EXHIBIT 99.2
CREDIT AGREEMENT
AMONG
XXXXXX OCEANICS PACIFIC LIMITED
AS BORROWER
AND
BANK ONE, TEXAS, N.A.,
CHRISTIANIA BANK OG KREDITKASSE ASA, NEW YORK BRANCH
AND THE FINANCIAL INSTITUTIONS NAMED HEREIN
AS BANKS
BANK ONE, TEXAS, N.A.,
AS ADMINISTRATIVE
AND DOCUMENTATION AGENT
CHRISTIANIA BANK OG KREDITKASSE ASA,
NEW YORK BRANCH
AS CO-AGENT
$25,000,000 REVOLVING CREDIT FACILITY
JULY 17, 1997
TABLE OF CONTENTS
Page No.
1. Definitions............................................................. 1
2. Commitments of the Bank................................................. 13
(a) Terms of Revolving Commitment.................................. 13
(b) Procedure for Borrowing........................................ 13
(c) Voluntary Reduction of Revolving Commitment.................... 14
(d) Mandatory Reduction............................................ 14
(e) Several Obligations............................................ 14
3. Notes Evidencing Loans.................................................. 14
(a) Form of Revolving Notes ....................................... 14
(b) Issuance of Additional Notes................................... 15
(c) Interest Rate.................................................. 15
(d) Payment of Interest............................................ 15
(e) Payment of Principal........................................... 15
(f) Payment to Banks............................................... 15
(g) Sharing of Payments, Etc....................................... 15
(h) Non-Receipt of Funds by the Agent.............................. 16
(i) Capital Adequacy............................................... 16
4. Interest Rates.......................................................... 17
(a) Options........................................................ 17
(b) Interest Rate Determination.................................... 18
(c) Conversion Option.............................................. 18
(d) Recoupment..................................................... 18
5. Special Provisions Relating to Loans.................................... 18
(a) Unavailability of Funds or Inadequacy of Pricing............... 18
(b) Taxes.......................................................... 19
(c) Change in Laws................................................. 19
(d) Option to Fund................................................. 19
(e) Indemnity...................................................... 20
(f) Payments Not at End of Interest Period......................... 20
6. Collateral and Guaranties............................................... 20
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7. Fees...................................................... 21
(a) Unused Fee....................................... 21
(b) Agency Fees...................................... 21
8. Prepayments............................................... 21
(a) Voluntary Prepayments............................ 21
(b) Mandatory Prepayment............................. 21
9. Representations and Warranties............................ 21
(a) Creation and Existence........................... 22
(b) Power and Authority.............................. 22
(c) Binding Obligations.............................. 22
(d) No Legal Bar or Resultant Lien................... 22
(e) No Consent....................................... 23
(f) Financial Condition.............................. 23
(g) Liabilities...................................... 23
(h) Litigation....................................... 23
(i) Taxes; Governmental Charges...................... 23
(j) Titles, Etc...................................... 24
(k) Defaults......................................... 24
(l) Casualties; Taking of Properties................. 24
(m) Use of Proceeds; Margin Stock.................... 24
(n) Location of Business and Offices................. 24
(o) Compliance with the Law.......................... 25
(p) No Material Misstatements........................ 25
(q) ERISA............................................ 25
(r) Public Utility Holding Company Act............... 25
(s) Environmental Matters............................ 25
(t) Liens............................................ 26
(u) Subsidiaries..................................... 26
10. Conditions of Lending..................................... 26
11. Affirmative Covenants..................................... 28
(a) Financial Statements and Reports................. 28
(b) Certificates of Compliance....................... 29
(c) Taxes and Other Liens............................ 29
(d) Compliance with Laws............................. 30
(e) Further Assurances............................... 30
(f) Performance of Obligations....................... 30
(g) Insurance........................................ 30
(h) Accounts and Records............................. 30
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(i) Right of Inspection.............................. 30
(j) Notice of Certain Events......................... 31
(k) ERISA Information and Compliance................. 31
(l) Environmental Compliance......................... 31
(m) Environmental Notifications...................... 32
(n) Environmental Indemnifications................... 33
(o) Change of Principal Place of Business............ 33
(p) Payables and Other Indebtedness.................. 33
(q) Maintenance of Rig............................... 33
12. Negative Covenants........................................ 33
(a) Negative Pledge.................................. 33
(b) Financial Covenants of Guarantors................ 34
(c) Consolidations and Mergers....................... 34
(d) Debts, Guaranties and Other Obligations.......... 34
(e) Dividends........................................ 35
(f) Loans and Advances............................... 35
(g) Sale or Discount of Receivables.................. 35
(h) Nature of Business............................... 36
(i) Transactions with Affiliates..................... 36
(j) Investment....................................... 36
(k) Amendment to Charter Documents................... 36
(l) Management of Rig................................ 36
(m) Modification of Rig.............................. 36
(n) Sale of Rigs, etc................................ 36
13. Events of Default......................................... 36
14. The Agent and the Banks................................... 39
(a) Appointment and Authorization.................... 39
(b) Note Holders..................................... 40
(c) Consultation with Counsel........................ 40
(d) Documents........................................ 40
(e) Resignation or Removal of Agent.................. 40
(f) Responsibility of Agent.......................... 41
(g) Independent Investigation........................ 42
(h) Indemnification.................................. 42
(i) Benefit of Section 14............................ 42
(j) Pro Rata Treatment............................... 42
(k) Assumption as to Payments........................ 43
(l) Other Financings................................. 43
(m) Interests of Banks............................... 43
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(n) Investments...................................... 44
(o) Withholding Tax.................................. 44
15. Exercise of Rights........................................ 44
16. Notices................................................... 44
17. Expenses.................................................. 45
18. Indemnity................................................. 45
19. Governing Law............................................. 46
20. Invalid Provisions........................................ 46
21. Maximum Interest Rate..................................... 46
22. Amendments or Waivers..................................... 47
23. Multiple Counterparts..................................... 47
24. Conflict.................................................. 48
25. Survival.................................................. 48
26. Parties Bound............................................. 48
27. Assignments and Participations............................ 48
28. Choice of Forum: Consent to Service of
Process and Jurisdiction................................ 50
29. Waiver of Jury Trial...................................... 50
30. Other Agreements.......................................... 50
31. Financial Terms........................................... 51
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Exhibits
Exhibit "A" - Notice of Borrowing
Exhibit "B" - Note
Exhibit "C" - Guaranty
Exhibit "D" - Certificate of Compliance
Exhibit "E" - Assignment and Acceptance Agreement
Schedules
Schedule 1 - Liens
Schedule 2 - Financial Condition
Schedule 3 - Liabilities
Schedule 4 - Litigation
Schedule 5 - Subsidiaries
Schedule 6 - Environmental Matters
Schedule 7 - Loans and Advances
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT (hereinafter referred to as the "Agreement")
executed as of the 17th day of July, 1997, by and among XXXXXX OCEANICS PACIFIC
LIMITED, a Cayman Islands company ("Borrower"), XXXXXX OCEANICS, INC., a Texas
corporation ("Xxxxxx"), XXXXXX DEEP SEAS, LTD., a Texas limited partnership
("Deep Seas") (Xxxxxx and Deep Seas shall hereinafter be collectively referred
to as "Guarantors" and, individually, as "Guarantor"), BANK ONE, TEXAS, N.A., a
national banking association ("Bank One"), CHRISTIANIA BANK OG KREDITKASSE ASA,
NEW YORK BRANCH, a banking association ("Christiania") and each of the financial
institutions which is a party hereto (as evidenced by the signature pages to
this Agreement) or which may from time to time become a party hereto pursuant to
the provisions of Section 27 hereof or any successor or assignee thereof
(hereinafter collectively referred to as "Banks", and individually, "Bank") and
Bank One, as Administrative and Documentation Agent ("Agent") and Christiania as
Co-Agent ("Co-Agent").
W I T N E S S E T H:
WHEREAS, Borrower has requested that the Banks provide Borrower with a
revolving credit facility and the Banks are willing to make such facility
available to Borrower.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereby agree as follows:
1. Definitions. When used herein the terms "Agent",
"Agreement", "Xxxxxx", "Bank", "Banks", "Bank One", "Borrower",
"Christiania", "Co-Agent", "Deep Seas", "Guarantor" and
"Guarantors" shall have the meanings indicated above. When used
herein the following terms shall have the following meanings:
"Advance or Advances" shall mean a loan or loans hereunder.
"Adjusted Eurodollar Rate" shall mean, with respect to any
Interest Period, a rate per annum equal to the quotient obtained
(rounded upward, if necessary, to the next higher 1/16 of 1%) by
dividing (i) the applicable Eurodollar Rate by (ii) 1.0 minus the
Eurodollar Reserve Percentage.
"Affiliate" shall mean any Person which, directly or
indirectly, controls, is controlled by or is under common control with
the relevant Person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by" and
"under common control with"), as used with respect to any Person, shall
mean a member of the board of directors, a partner or an officer of
such Person, or any other Person with possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of such Person, through the ownership (of
record, as trustee, or by proxy) of voting shares, partnership
interests or voting rights, through a management contract or otherwise.
Any Person owning or controlling directly or indirectly ten percent or
more of the voting shares, partnership interests or voting rights,
or other equity interest of another Person shall be deemed to be an
Affiliate of such Person.
"Assignment and Acceptance" shall mean a document
substantially in the form of Exhibit "D" hereto.
"Base Rate" shall mean, as of any date, the fluctuating rate
of interest per annum established from time to time by Agent as its
Base Rate (which rate of interest may not be the lowest, best or most
favorable rate of interest which Agent may charge on loans to its
customers). Each change in the Base Rate shall become effective without
prior notice to Borrower automatically as of the opening of business on
the date of such change in the Base Rate.
"Base Rate Interest Period" shall mean, with respect to any
Base Rate Loan, the period ending on the last day of each month,
provided, however, that (i) if any Base Rate Interest Period would end
on a day which is not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day, and (ii) if any Base Rate
Interest Period would otherwise end after the Maturity Date such
Interest Period shall end on the Maturity Date.
"Base Rate Loans" shall mean any loan during any period which
bears interest based upon the Base Rate or which would bear interest
based upon the Base Rate if the Maximum Rate ceiling was not in effect
at that particular time.
"Base Rate Margin" shall mean:
(i) one-fourth of one percent (.25%) per annum
whenever Xxxxxx'x ratio of Consolidated Funded Debt to
Consolidated EBITDA is equal to or greater than 1.25 to 1.0;
(ii) zero percent (.0%) per annum whenever Xxxxxx'x
ratio of Consolidated Funded Debt to Consolidated EBITDA is
less than 1.25 to 1.0.
For the purposes of calculating the Base Rate Margin for each new or
existing Tranche, Xxxxxx'x (i) Consolidated Funded Debt shall fluctuate
from day to day, and (ii) Consolidated EBITDA shall be calculated
quarterly as of the end of each fiscal quarter and annualized. The Base
Rate Margin shall be recalculated by Agent from time to time and be
effective upon (a) the making of any Advance hereunder, (b) the receipt
by the Banks of any payment or prepayment or (c) receipt by Agent of
the Borrower's quarterly Certificate of Compliance provided by Borrower
pursuant to Section 11(b) hereof.
"Borrowing Date" is used herein as defined in Section 2(d)
hereof.
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"Business Day" shall mean the normal banking hours during any
day (other than Saturdays or Sundays) that banks are legally open for
business in Houston, Texas and New York, New York.
"Capital Leases" shall mean any lease in respect of which the
obligations thereunder constitute Capitalized Lease Obligations.
"Capitalized Lease Obligations" shall mean, without
duplication, all obligations of any Person to pay rent or amounts under
any lease of, or other arrangement conveying the right to use, real or
personal property, or a combination thereof, which obligations shall
have been or should be, in accordance with GAAP, capitalized on the
books of such Person.
"Cash Equivalents" shall mean (i) securities issued or
directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof (provided that the
full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than six months from the
date of acquisition, (ii) U.S. dollar denominated time deposits,
certificates of deposit and bankers' acceptances of (x) any Bank, (y)
any domestic commercial bank of recognized standing having capital and
surplus in excess of $100,000,000 or (z) any Bank (or the parent
company of such bank) whose short-term commercial paper rating from
Standard & Poor's Corporation ("S&P") is at least A-1 or the equivalent
thereof or from Xxxxx'x Investors Service, Inc. ("Xxxxx'x") is at least
P-1 or the equivalent thereof (any such bank, an "Approved Bank"), in
each case with maturities of not more than six months from the date of
acquisition, (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clause
(i) above entered into with any bank meeting the qualifications
specified in clause (ii) above, (iv) commercial paper issued by any
Bank or Approved Bank or by the parent company of any Bank or Approved
Bank and commercial paper issued by, or guaranteed by, any industrial
or financial company with a short-term commercial paper rating of at
least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody's (any such company, an "Approved
Company"), or guaranteed by any industrial company with a long term
unsecured debt rating of at least A or A2 or the equivalent of each
thereof, from S&P or Moody's, as the case may be, and in each case
maturing within six months after the date of acquisition and (v)
investments in money market funds substantially all of whose assets are
comprised of securities of the type described in clauses (i) through
(iv) above.
"Change of Management" shall occur if both (i) Xxxx X. Xxxxx
ceases to act as President and Chief Executive Officer, and (ii) Xxxxx
X. Xxxxxxx ceases to act as Senior Vice President and Secretary of
Xxxxxx, other than as a result of death, disability or normal
retirement of either.
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"Consolidated Adjusted EBITDA" shall mean Consolidated EBITDA
less (i) capitalized cash maintenance expenditures and (ii) dividends
(other than dividends from any Subsidiary to Xxxxxx).
"Consolidated Current Assets" shall mean, the current assets
of Xxxxxx and its Subsidiaries on a consolidated basis determined in
accordance with GAAP and in a manner consistent with prior periods,
plus, as of any date, the current unused availability on the Revolving
Commitment and under the Guarantors' Credit Agreement.
"Consolidated Current Liabilities" shall mean, the current
liabilities of Xxxxxx and its Subsidiaries on a consolidated basis as
determined in accordance with GAAP and in a manner consistent with
prior periods, excluding therefrom current maturities due on the
Revolving Loans and under the Guarantors' Credit Agreement.
"Consolidated Debt Service" shall mean the sum of 1/12 of the
outstanding principal balance of the Guarantors' Obligations.
"Consolidated EBITDA" shall mean for any period for Xxxxxx and
its Subsidiaries on a consolidated basis, (A) the sum of the amounts
for such period of (i) Consolidated Net Income, (ii) depreciation
expense, (iii) provisions for taxes based on income, (iv) Consolidated
Interest Expense, (v) amortization and write-off of deferred financing
costs to the extent deducted in determining Consolidated Net Income,
and (vi) losses on sales of assets (excluding sales in the ordinary
course of business) and other extraordinary losses, less (B)
extraordinary gains for such period, all determined in accordance with
GAAP and in a manner consistent with prior periods.
"Consolidated Equity" shall mean, at any time, the
shareholder's equity of Xxxxxx and its Subsidiaries on a consolidated
basis as determined in accordance with GAAP and in a manner consistent
with prior periods.
"Consolidated Funded Debt" shall mean, the sum of (i) all Debt
of Xxxxxx and its Subsidiaries calculated on a consolidated basis in
accordance with GAAP and in a manner consistent with prior periods,
less (ii) the market value of the Treasury Bonds.
"Consolidated Interest Expense" shall mean, for any period,
the sum of (i) total interest expense (including that attributable to
Capitalized Lease Obligations) of Xxxxxx and its Subsidiaries on a
consolidated basis in accordance with GAAP with respect to all
outstanding Debt of Xxxxxx and its Subsidiaries, including, without
limitation, all commissions, discounts and other fees and charges owed
with respect to Letters of Credit and bankers' acceptance financing,
less (ii) interest expense attributable to $20,000,000 of the
outstanding principal balance of the Notes.
-4-
"Consolidated Net Income" shall mean, for any period, the net
income (or loss) of Xxxxxx and its Subsidiaries on a consolidated basis
for such period taken as a single accounting period determined in
accordance with GAAP and in a manner consistent with prior periods.
"Consolidated Tangible Net Worth" shall mean, at any time, the
Consolidated Equity of Xxxxxx and its Subsidiaries on a consolidated
basis determined in accordance with GAAP and in a manner consistent
with prior periods, less all unamortized debt discount and expense,
unamortized deferred charges, goodwill, patents, trademarks, service
marks, trade names, copyrights and organization expense.
"Debt" shall mean as to Xxxxxx, the Borrower, or any
Subsidiary of Xxxxxx or the Borrower, all obligations and liabilities
of the Borrower or such Subsidiaries to any other person, including,
without limitation, all debts, claims and indebtedness, heretofore, now
and/or from time to time hereafter owing, due or payable, however
evidenced, created, incurred, acquired or owing and however arising,
whether under written or oral agreement, operation of law, or
otherwise. Debt includes, without limiting the foregoing, (i)
indebtedness for borrowed money (including without duplication
obligations to reimburse the issuer of any letter of credit or any
guarantor or surety), (ii) indebtedness for the deferred purchase price
of property or services, excluding trade accounts payable within ninety
(90) days and arising in the ordinary course of business, (ii)
indebtedness evidenced by bonds, debentures, notes or other similar
instruments, (iv) obligations and liabilities secured by a Lien on
property owned by the Borrower or any Subsidiary of the Borrower,
whether or not Borrower or Subsidiary has assumed such obligations and
liabilities and the amount of which Debt shall not exceed the fair
market value of the property subject to the Lien if Borrower or
Subsidiary has not assumed such obligations and liabilities, (v)
obligations or liabilities created or arising under any Capitalized
Lease, (vi) all net payments or amounts owing by Borrower or any
Subsidiary of the Borrower in respect of interest rate protection
agreements, foreign currency exchange agreements, commodity swap
agreements or other interests, exchange rate or commodity hedging
arrangements and (vii) liabilities in respect of unfunded vested
benefits under any Plan. The Debt of the Borrower or any Subsidiary of
the Borrower shall include the Debt of any partnership or joint venture
in which the Borrower or any Subsidiary of the Borrower is a general or
venture partner. The Debt of the Borrower or any Subsidiary of the
Borrower shall not include trade payables and expense accruals incurred
or assumed in the ordinary course of the Borrower's or such
Subsidiary's business (including trade payables and expense accruals of
any partnership or joint venture in which the Borrower or any
Subsidiary of the Borrower is a general or venture partner; provided,
such payables have not remained unpaid for a period of ninety (90) days
after the same became due unless the Borrower or such Subsidiary is
diligently contesting same in good faith).
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"Default" shall mean any Event of Default and the occurrence
of an event or condition which would with the giving of any requisite
notice and/or passage of time or both constitute an Event of Default.
"Default Rate" shall mean the Base Rate plus 5% per annum.
"Defaulting Bank" is used herein as defined in Section 3(f)
hereof.
"Effective Date" shall mean the date of this Agreement.
"Eligible Assignee" shall mean any of (i) a Bank or any
Affiliate of a Bank; (ii) a commercial bank organized under the laws of
the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (iii) a commercial bank organized
under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development, or a political
subdivision of any such country, and having a combined capital and
surplus of at least $100,000,000, provided that such bank is acting
through a branch or agency located in the United States; and (iv) a
Person that is primarily engaged in the business of commercial banking
and that (A) is a subsidiary of a Bank, (B) a subsidiary of a Person of
which a Bank is a subsidiary, or (C) a Person of which a Bank is a
subsidiary; provided, however, that as a condition precedent to any
bank organized under the laws of any other country other than the
United States qualifying as an "Eligible Assignee" shall be the
providing by such bank of the U.S. Internal Revenue Service forms
required by Section 14(o) of this Agreement;
"Environmental Laws" shall mean all laws, statutes, codes,
acts, ordinances, orders, judgments, decrees, injunctions, rules,
regulations, order and restrictions of any Governmental Authority
relating to air pollution, water pollution, noise control and/or the
handling, discharge, disposal or recovery of on-site or off-site
Hazardous Substances.
"Environmental Liability" shall mean any claim, demand,
obligation, cause of action, order, violation, damage, injury,
judgment, penalty or fine, cost of enforcement, cost of remedial action
or any other costs or expense whatsoever, including reasonable
attorneys' fees and disbursements, resulting from the violation or
alleged violation of any Environmental Law or the imposition of any
Environmental Lien (as hereinafter defined) which could reasonably be
expected to individually or in the aggregate have a Material Adverse
Effect.
"Environmental Lien" shall mean a Lien in favor of any
Governmental Authority or any other Person (i) for any Environmental
Liability or (ii) for damages arising from or cost incurred by such
court or Governmental Authority or other person in response to a
release or threatened release of any hazardous substance into the
environment.
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"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
"Eurodollar Business Day" shall mean a Business Day on which
dealings in U.S. Dollar deposits are carried on in the London interbank
market.
"Eurodollar Interest Period" shall mean with respect to any
Eurodollar Loan (i) initially, the period commencing on the date such
Eurodollar Loan is made and ending one (1), two (2), three (3) or six
(6) months thereafter as selected by Borrower pursuant to Section
4(a)(ii), and (ii) thereafter, each period commencing on the day
following the last day of the next preceding Interest Period applicable
to such Eurodollar Loan and ending one (1), two (2), three (3) or six
(6) months thereafter, as selected by Borrower pursuant to Section
4(a)(ii); provided, however, that (a) if any Eurodollar Interest Period
would otherwise expire on a day which is not a Eurodollar Business Day,
such Interest Period shall expire on the next succeeding Eurodollar
Business Day unless the result of such extension would be to extend
such Interest Period into the next calendar month, in which case such
Interest Period shall end on the immediately preceding Eurodollar
Business Day, (b) if any Eurodollar Interest Period begins on the last
Eurodollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the
end of such Interest Period) such Interest Period shall end on the last
Eurodollar Business Day of a calendar month, and (c) any Eurodollar
Interest Period which would otherwise expire after the Maturity Date
shall end on such Maturity Date.
"Eurodollar Loan" shall mean any loan during any period which
bears interest at the Eurodollar Rate, or which would bear interest at
such rate if the Maximum Rate ceiling was not in effect at a particular
time.
"Eurodollar Margin" shall mean, with respect to each
Eurodollar Loan:
(i) one percent (1%) per annum whenever Xxxxxx'x ratio of
Consolidated Funded Debt to Consolidated EBITDA is equal to or
greater than 1.25 to 1.0; or
(ii) three-fourths of one percent (.75%) per annum
whenever Xxxxxx'x ratio of Consolidated Funded Debt to
Consolidated EBITDA is greater than 1.0 to 1.0 but less than
1.25 to 1.0; or
(iii) one-half of one percent (.50%) per annum
whenever Xxxxxx'x ratio of Consolidated Funded Debt to
Consolidated EBITDA is less than or equal to 1.0 to 1.0.
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For the purposes of calculating the Eurodollar Margin for each new or
existing Tranche, Xxxxxx'x (i) Consolidated Funded Debt shall fluctuate
from day to day, and (ii) Consolidated EBITDA shall be calculated
quarterly as of the end of each fiscal quarter and annualized. The
Eurodollar Margin shall be recalculated by Agent from time to time and
be effective upon (a) the making of any Advance hereunder, (b) the
receipt by the Banks of any payment or prepayment or (c) the receipt by
Agent of Borrower's quarterly Certificate of Compliance provided by
Borrower pursuant to Section 11(b) hereof.
"Eurodollar Rate" shall mean with respect to each Eurodollar
Interest Period, the offered rate (rounded upward to the nearest 1/16
of one percent) for deposits of U.S. Dollars for a period equivalent to
such period at or about 11:00 A.M. (London time) on the second
Eurodollar Business Day before the first day of such period as is
displayed on Telerate page 3750 (British Bankers' Association Interest
Settlement Rates) (or such other page as may replace such page 3750 on
such system or on any other system of the information vendor for the
time being designated by the British Bankers' Association to calculate
the BBA Interest Settlement Rate (as defined in the British Bankers'
Association's Recommended Terms and Conditions ("BBAIRS" terms) dated
August 1985), provided that if on such date no such rate is so
displayed, the Eurodollar Rate for such period shall be the rate quoted
to the Agent as the offered rate for deposits of U.S. Dollars in an
amount approximately equal to the amount in relation to which the
Eurodollar Rate is to be determined for a period equivalent to such
period by prime banks in the London interbank market at or about 11:00
A.M. (London time) on the second Eurodollar Business Day before the
first day of such period.
"Eurodollar Reserve Percentage" shall mean for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or
any successor) for determining the maximum reserve requirement for a
member bank of the Federal Reserve System in respect of "Eurodollar
liabilities" (or in respect of any other category of liabilities which
includes deposits by reference to which the interest rate on Eurodollar
Loans is determined on any category of extension of credit or other
assets which includes loans by a non-United States office of any Bank
to United States residents). The Adjusted Eurodollar Rate shall be
adjusted automatically on or as of the effective date of any change in
the Eurodollar Reserve Percentage.
"Event of Default" is used herein as defined in Section 13
hereof.
"Financial Statements" shall mean balance sheets, income
statements, statements of cash flow and appropriate footnotes and
schedules, prepared in accordance with GAAP and in a manner consistent
with prior periods.
-8-
"GAAP" shall mean generally accepted accounting principles,
consistently applied in the United States of America.
"Guarantors' Credit Agreement" shall mean that certain Credit
Agreement among Guarantors, the Banks, the Agent and the Co-Agent dated
of even date herewith pursuant to which the Banks made available to the
Guarantors a $100,000,000 revolving credit facility.
"Guarantors' Obligations" shall mean (i) the outstanding
principal balance due on the Notes issued under the Revolving
Commitment as of any date of determination plus (ii) the sum of (A) the
principal balance due on all promissory notes issued by Guarantors
under the Guarantors' Credit Agreement, less (B) the market value of
all Treasury Bonds pledged as collateral for Guarantors' obligations
under the Guarantors' Credit Agreement, plus (C) interest expense
attributable to $20,000,000 of the outstanding principal balance due on
the notes issued pursuant to the Guarantors' Credit Agreement.
"Guaranty" shall mean the unconditional guaranties of Xxxxxx
and Deep Seas of all obligations owed the Banks by Borrower in the form
of Exhibit "C" hereto.
"Governmental Authority" shall mean any nation or government,
any federal, state, province, city, town, municipality, county, local
or other political subdivision thereof or thereto and any department,
commission, board, bureau, instrumentality, agency or other entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Hazardous Substances" shall mean petroleum and used oil, or
any other pollutant or contaminant, hazardous, dangerous or toxic
waste, substance or material as defined in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, 42 U.S.C. Sec. 9601, et seq. (hereinafter called "CERCLA");
the Resource Conversation and Recovery Act, as amended, 42 U.S.C. 6901,
et seq. (hereinafter called "RCRA"); the Toxic Substances Control Act,
as amended, 15 U.S.C. Sec. 2601 et seq. (hereinafter called "TSCA");
the Hazardous Materials Transportation Act, as amended, 49 U.S.C. Sec.
1801, et seq (hereinafter called "HMTA"); the Oil Pollution Act of
1990, Pub. L. No. 101-380, 104 Stat. 484 (1990) (hereinafter called
"OPA"); or any other statute, law, ordinance, code or regulation of any
Governmental Agency relating to or imposing liability or standards of
conduct concerning the use, production, generation, treatment, storage,
recycling, handling, transportation, release, threatened release or
disposal of any hazardous, dangerous or toxic waste, substance or
material, currently in effect or at any time hereafter adopted.
"Interest Payment Date" shall mean the earlier of (i) the last
Business Day of each Interest Period or (ii) the last day of each
calendar quarter.
-9-
"Interest Period" shall mean any Base Rate Interest Period,
or Eurodollar Interest Period.
"Lien" shall mean any mortgage, deed of trust, pledge,
security interest, assignment, encumbrance or lien (statutory or
otherwise) of every kind and character.
"Loan Documents" shall mean this Agreement, the Note, the
Security Instruments and all other documents executed in connection
with the transaction described in this Agreement.
"Loans" shall mean Advances under the Revolving Commitment,
whether in the form of a Base Rate Loan or a Eurodollar Loan.
"Majority Banks" shall mean Banks holding 66-2/3% or more of
the Revolving Commitments.
"Material Adverse Effect" shall mean any circumstance or event
which could have a material adverse effect on (i) the assets or
properties, liabilities, financial condition, business, operations, or
prospects of the Borrower and its Subsidiaries, taken as a whole, or
(ii) the ability of the Borrower and its Subsidiaries, taken as a
whole, to carry out their respective businesses as of the date of this
Agreement or as proposed at the date of this Agreement to be conducted,
or (iii) the ability of Borrower, to meet its obligations under the
Note, this Agreement or the other Loan Documents on a timely basis, or
(iv) the validity or enforceability of any Loan Document against
Borrower.
"Maturity Date" shall mean March 31, 2002.
"Maximum Rate" shall mean at any particular time in question,
the maximum non-usurious rate of interest which under applicable law
may then be charged on the Note. If such Maximum Rate changes after the
date hereof, the Maximum Rate shall be automatically increased or
decreased, as the case may be, without notice to Borrower from time to
time as the effective date of each change in such Maximum Rate.
"Notes" shall mean the revolving notes substantially in the
form of Exhibit "B" hereto issued or to be issued hereunder to each
Bank, respectively, to evidence the indebtedness to such Bank arising
by reason of the Advances on the Revolving Loans, together with all
modifications, renewals and extensions thereof or any part thereof.
"Notice of Borrowing" is used herein as defined in Section
2(b) hereof.
"Other Financings" is used herein as defined in Section
14(l) hereof.
-10-
"Payor" is used herein as defined in Section 3(h) hereof.
"Permitted Liens" shall mean (i) Liens for taxes, governmental
charges, levies or other assessments that are not yet delinquent (or
that, if delinquent, are being contested in good faith by appropriate
proceedings, levy and execution thereon having been stayed and continue
to be stayed and for which Borrower has set aside on its books adequate
reserves in accordance with GAAP); (ii) maritime (including, without
limitation, Liens for insurance premiums or calls and Liens arising
under charters), materialmen's, mechanic's, repairmen's, employee's,
warehousemen's, landlord's, carrier's, contractor's, sub-contractor's
and other Liens (including any financing statements filed in respect
thereof) incidental to obligations incurred by Borrower in connection
with the construction, maintenance, transportation, storage or
operation of Borrower's assets, or properties to the extent not
delinquent (or which, if delinquent, are being contested in good faith
by appropriate proceedings and for which Borrower has set aside on its
books adequate reserves in accordance with GAAP); (iii) all contracts,
agreements and instruments, any interest or title of a lessor or
charterer under any lease permitted by this Agreement and all defects
and irregularities and other matters affecting Borrower's assets and
properties which were in existence or arose at the time Borrower's
assets and properties were originally acquired by Borrower and all
routine operational agreements entered into in the ordinary course of
business, which contracts, agreements, instruments, defects,
irregularities and other matters and routine operational agreements are
not such as to, individually or in the aggregate, interfere materially
with the operation, value or use of Borrower's assets and properties,
considered in the aggregate; (iv) liens in connection with workmen's
compensation, unemployment insurance or other social security, old age
pension or public liability obligations; (v) legal or equitable
encumbrances deemed to exist by reason of the existence of any
litigation or other legal proceeding or arising out of a judgment or
award with respect to which an appeal is being prosecuted in good faith
and levy and execution thereon have been stayed and continue to be
stayed; (vi) Liens incurred pursuant to the Security Instruments; and
(vii) Liens existing at the date of this Agreement which have been
disclosed to Banks in Borrower's March 31, 1997 Financial Statements or
identified in Schedule "1" hereto and which are either released by the
Effective Date or consented to by the Banks.
"Person" shall mean an individual, a corporation, a
partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an
agency or instrumentality thereof.
"Plan" shall mean any plan subject to Title IV of ERISA and
maintained by Borrower, or its Subsidiaries, or any such plan to which
Borrower or its Subsidiaries are required to contribute on behalf of
its employees.
-11-
"Pro Rata or Pro Rata Part" shall mean for each Bank, (i) for
all purposes where no Revolving Loan is outstanding, such Bank's
Revolving Commitment Percentage and (ii) otherwise, the proportion
which the portion of the outstanding Revolving Loans owed to such Bank
bears to the aggregate outstanding Revolving Loans owed to all Banks at
the time in question.
"Required Payment" is used herein as defined in Section 3(h)
hereof.
"Revolving Commitment" shall mean (A) for all Banks,
$25,000,000 as reduced from time to time pursuant to Sections 2(c) and
2(d) hereof and (B) as to any Bank, its obligation to make Advances
hereunder on the Revolving Loans in amounts not exceeding, in the
aggregate, the amount set forth opposite the name of such Bank on the
signature pages hereto under the heading "Revolving Commitment" or in
its Assignment and Acceptance.
"Revolving Commitment Percentage" shall mean for each Bank the
percentage derived by dividing its Revolving Commitment at the time of
determination by Revolving Commitments of all Banks at the time of
determination.
"Revolving Loans" shall mean loans made under the Revolving
Commitment pursuant to Section 2 hereof.
"Rig" is used herein as defined in Section 9(j) hereof.
"Secured Obligations" is used herein as defined in Section 6
hereof.
"Security Instruments" shall mean this Agreement, the Guaranty
and other documents, all such documents to be in form and substance
satisfactory to Agent.
"Subsidiary" shall mean any corporation or other entity of
which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly
owned by Borrower or another subsidiary of Borrower.
"Total Outstandings" shall mean as of any date the total
principal balance outstanding on the Notes.
"Tranche" shall mean a Eurodollar Loan or a Base Rate Loan.
"Unused Commitment Fees" is used herein as defined in
Section 7(a) hereof.
-12-
2. Commitments of the Bank.
(a) Terms of Revolving Commitment. On the terms and conditions
hereinafter set forth, each Bank agrees severally to make Advances to
Borrower from time to time during the period beginning on the Effective
Date and ending on the Maturity Date in such amounts as Borrower may
request up to an amount not to exceed, in the aggregate principal
amount outstanding at any time, the Revolving Commitment. Subject to
the terms hereof, the Borrower may borrow, repay and reborrow
hereunder. The obligation of Borrower hereunder shall be evidenced by
this Agreement and the Note or Notes issued in connection herewith,
said Note or Notes to be as described in Section 3 hereof.
Notwithstanding any other provision of this Agreement, no Advance shall
be required to be made hereunder if any Default or Event of Default (as
hereinafter defined) has occurred and is continuing. Each Advance under
the Revolving Commitment shall be an amount of at least $1,000,000 or a
whole number multiple thereof. Irrespective of the face amount of the
Revolving Note or Notes, the Banks shall never have the obligation to
Advance any amount or amounts in excess of the Revolving Commitment or
to increase the Revolving Commitment. The total number of Tranches
under the Revolving Commitment which may be outstanding at any time
hereunder shall never exceed five (5), whether such Tranches are Base
Rate Loans, Eurodollar Loans, or a combination thereof.
(b) Procedure for Borrowing. Whenever Borrower desires an
Advance hereunder, it shall give Agent telegraphic, telex, facsimile or
telephonic notice ("Notice of Borrowing") of such requested Advance,
which in the case of telephonic notice, shall be promptly confirmed in
writing. Each Notice of Borrowing shall be in the form of Exhibit "A"
attached hereto and shall be received by Agent not later than 11:00
a.m. Houston, Texas time, (i) one Business Day prior to the date upon
which any such Advance is requested to be funded (the "Borrowing Date")
in the case of the Base Rate Loan, or (ii) three (3) Eurodollar
Business Days prior to any proposed Borrowing Date in the case of
Eurodollar Loans. Upon receipt of such Notice, Agent shall immediately
advise each Bank thereof; provided, that if the Banks have received at
least one (1) Business Day's notice of such Advance prior to funding of
a Base Rate Loan, or at least three (3) Eurodollar Business Days'
notice of each Advance prior to funding in the case of a Eurodollar
Loan, each Bank shall provide Agent at its office at 000 Xxxxxx,
Xxxxxxx, Xxxxx 00000-0000, not later than 1:00 p.m., Houston, Texas
time, on the Borrowing Date, in immediately available funds, its pro
rata share of the requested Advance, but the aggregate of all such
fundings by each Bank shall never exceed such Bank's Revolving
Commitment. Not later than 2:00 p.m., Houston, Texas time, on the
Borrowing Date, Agent shall make available to Borrower at the same
office, in like funds, the aggregate amount of such requested Advance.
Neither Agent nor any Bank shall incur any liability to Borrower in
acting upon any Notice referred to above which Agent or such Bank
believes in good faith to have been given by a duly authorized officer
or other person authorized to borrow on behalf of Borrower or for
otherwise acting in good faith under
-13-
this Section 2(b). Upon funding of Advances by Banks in accordance with
this Agreement, pursuant to any such Notice of Borrowing, Borrower
shall have effected Advances hereunder.
(c) Voluntary Reduction of Revolving Commitment. Borrower may
at any time, or from time to time, upon not less than three (3)
Business Days prior written notice to Agent, reduce or terminate the
Revolving Commitment; provided, however, that (i) each reduction in the
Revolving Commitment must be in the amount of at least $1,000,000 or in
increments of $1,000,000 and (ii) each reduction must be accompanied by
a prepayment of the Notes in the amount by which the outstanding
principal balance of the Notes exceeds the Revolving Commitment as
reduced pursuant to this Section 2(c).
(d) Mandatory Reduction of Revolving Commitment. The Revolving
Commitment shall be automatically reduced as of the last day of each
fiscal quarter beginning on March 31, 1999 by the amount of $1,666,667
per quarter (the "Quarterly Commitment Reduction").
(e) Several Obligations. The obligations of the Banks under
the Revolving Commitment are several and not joint. The failure of any
Bank to make an Advance required to be made by it shall not relieve any
other Bank of its obligation to make its Advance, and no Bank shall be
responsible for the failure of any other Bank to make the Advance to be
made by such other Bank. No Bank shall be required to lend hereunder
any amount in excess of its legal lending limit; however, each Bank
hereunder covenants that the Revolving Commitment does not, as of the
date hereof, exceed its legal lending limit.
3. Notes Evidencing Loans. The loans described above in
Section 2 shall be evidenced by notes of the Borrower as follows:
(a) Form of Revolving Notes - The Revolving Loans shall be
evidenced by Notes in the aggregate face amount of $25,000,000, and
shall be in the form of Exhibit "B" hereto with appropriate insertions.
Notwithstanding the face amount of the Notes, the actual principal
amount due from Borrower to Banks on account of the Notes, as of any
date of computation, shall be the sum of Advances then and theretofore
made on account thereof, plus outstanding Reimbursement Obligations
less all principal payments actually received by Banks in collected
funds with respect thereto. Although the Notes may be dated as of the
Effective Date, interest in respect thereof shall be payable only for
the period during which the loans evidenced thereby are outstanding
and, although the stated amount of the Notes may be higher, the Notes
shall be enforceable, with respect to Borrower's obligation to pay the
principal amount thereof, only to the extent of the unpaid principal
amount of the loans.
-14-
(b) Issuance of Additional Notes - At the Effective Date there
shall be outstanding (i) seven (7) Notes in the aggregate face amount
of $25,000,000 payable to the order of the Banks for each such Bank's
Pro Rata Part of the Revolving Commitment. From time to time new Notes
may be issued to other Banks as such Banks become parties to this
Agreement. Upon request from Agent, Borrower shall execute and deliver
to Agent any such new or additional Notes. From time to time as new
Notes are issued the Agent shall require that each Bank exchange their
Notes for newly issued Notes to reflect the extent of each Bank's
Revolving Commitments hereunder.
(c) Interest Rates - The unpaid principal balance of all
outstanding advances under the Notes shall bear interest from time to
time as set forth in Section 4 hereof.
(d) Payment of Interest - Interest on the Notes shall be
payable to the Agent for the ratable benefit of the Banks on each
Interest Payment Date.
(e) Payment of Principal - Principal of the Revolving Notes
shall be due and payable to the Agent for the ratable benefit of the
Banks on the Maturity Date unless earlier due in whole or in part as a
result of an acceleration of the amount due or pursuant to the
mandatory prepayment provisions of Sections 8(b) hereof.
(f) Payment to Banks - Each Bank's Pro Rata Part of payment or
prepayment of the Revolving Loans shall be directed by wire transfer to
such Bank by the Agent at the address provided to the Agent for such
Bank for payments no later than 2:00 p.m., Houston, Texas, time on the
Business Day such payments or prepayments are deemed hereunder to have
been received by Agent; provided, however, in the event that any Bank
shall have failed to make an Advance as contemplated under Section 2
hereof (a "Defaulting Bank") and the Agent or another Bank or Banks
shall have made such Advance, payment received by Agent for the account
of such Defaulting Bank or Banks shall not be distributed to such
Defaulting Bank or Banks until such Advance or Advances shall have been
repaid in full to the Bank or Banks who funded such Advance or
Advances. Any payment or prepayment received by Agent at any time after
12:00 noon, Houston, Texas, time on a Business Day shall be deemed to
have been received on the next Business Day. Interest shall cease to
accrue on any principal as of the end of the day preceding the Business
Day on which any such payment or prepayment is deemed hereunder to have
been received by Agent. If Agent fails to transfer any principal amount
to any Bank as provided above, then Agent shall promptly direct such
principal amount by wire transfer to such Bank. Payment by the Borrower
of any principal, interest or other fees or expenses due hereunder to
the Agent shall extinguish the obligations of Borrower to each Bank for
such principal, interest or other fees or expenses actually paid.
(g) Sharing of Payments, Etc. - If any Bank shall obtain any
payment (whether voluntary, involuntary, or otherwise) on account
of the Revolving Loans, (including,
-15-
without limitation, any set-off) which is in excess of its Pro Rata
Part of payments on the Revolving Loans such Bank shall purchase from
the other Banks such participation as shall be necessary to cause such
purchasing Bank to share the excess payment pro rata with each of them;
provided that, if all or any portion of such excess payment is
thereafter recovered from such purchasing Bank, the purchase shall be
rescinded and the purchase price restored to the extent of the
recovery. Borrower agrees that any Bank so purchasing a participation
from another Bank pursuant to this Section may, to the fullest extent
permitted by law, exercise all of its rights of payment (including the
right of offset) with respect to such participation as fully as if such
Bank were the direct creditor of Borrower in the amount of such
participation.
(h) Non-Receipt of Funds by the Agent - Unless the Agent shall
have been notified by a Bank or Borrower (the "Payor") prior to the
date on which such Bank is to make payment to the Agent of the proceeds
of a Revolving Loans to be made by it hereunder or Borrower is to make
a payment to the Agent for the account of one or more of the Banks, as
the case may be (such payment being herein called the "Required
Payment"), which notice shall be effective upon receipt, that the Payor
does not intend to make the Required Payment to the Agent, the Agent
may assume that the Required Payment has been made and may, in reliance
upon such assumption (but shall not be required to), make the amount
thereof available to the intended recipient on such date and, if the
Payor has not in fact made the Required Payment to the Agent, the
recipient of such payment shall, on demand, pay to the Agent the amount
made available to it together with interest thereon in respect of the
period commencing on the date such amount was made available by the
Agent until the date the Agent recovers such amount at the rate
applicable to such portion of the applicable Revolving Loan.
(i) Capital Adequacy - If either (i) the introduction or
implementation of or the compliance with or any change in or in the
interpretation of any law, rule or regulation or (ii) the introduction
or implementation of or the compliance with any mandatory request,
directive or guideline from any central bank or other governmental
authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by
any Bank or any corporation controlling any Bank as a result of
maintaining the Revolving Loans, then within fifteen (15) days after
demand by such Bank, Borrower will pay to such Bank, from time to time
as specified by such Bank, such additional amount or amounts which such
Bank shall reasonably determine to be appropriate to compensate such
Bank or any corporation controlling such Bank in light of such
circumstances, to the extent that such Bank reasonably determines that
the amount of any such capital would be increased, or the rate of
return on any such capital would be reduced in whole or in part, based
on the existence of the amount of the Revolving Loans or such Bank's
Revolving Commitment under this Agreement.
-16-
4. Interest Rates.
(a) Options.
(i) Base Rate Loans. Borrower agrees to pay interest
on the Revolving Loans calculated on the basis of the actual
days elapsed in a year consisting of 365 or, if appropriate,
366 days with respect to the unpaid principal amount of each
Base Rate Loan from the date the proceeds thereof are made
available to Borrower until maturity (whether by acceleration
or otherwise), at a varying rate per annum equal to the lesser
of (i) the Maximum Rate (defined herein), or (ii) the sum of
the Base Rate plus the Base Rate Margin. Subject to the
provisions of this Agreement as to prepayment, the principal
of the Notes representing Base Rate Loans shall be payable as
specified in Section 3(e) hereof and the interest in respect
of each Base Rate Loan shall be payable on each Interest
Payment Date. Past due principal and, to the extent permitted
by law, past due interest in respect to each Base Rate Loan,
shall bear interest, payable on demand, at a rate per annum
equal to the Default Rate.
(ii) Eurodollar Loans. Borrower agrees to pay
interest calculated on the basis of a year consisting of 360
days with respect to the unpaid principal amount of each
Eurodollar Loan from the date the proceeds thereof are made
available to Borrower until maturity (whether by acceleration
or otherwise), at a varying rate per annum equal to the lesser
of (i) the Maximum Rate, or (ii) the Eurodollar Rate plus the
Eurodollar Margin. Subject to the provisions of this Agreement
with respect to prepayment, the principal of the Notes shall
be payable as specified in Section 3(e) hereof and the
interest with respect to each Eurodollar Loan shall be payable
on each Interest Payment Date. Past due principal and, to the
extent permitted by law, past due interest shall bear
interest, payable on demand, at a rate per annum equal to the
Default Rate. Upon three (3) Eurodollar Business Days' written
notice prior to the making by the Banks of any Eurodollar Loan
(in the case of the initial Interest Period therefor) or the
expiration date of each succeeding Interest Period (in the
case of subsequent Interest Periods therefor), Borrower shall
have the option, subject to compliance by Borrower with all of
the provisions of this Agreement, as long as no Event of
Default exists, to specify whether the Interest Period
commencing on any such date shall be a one (1), two (2), three
(3) or six (6) month period. If Agent shall not have received
timely notice of a designation of such Interest Period as
-17-
herein provided, Borrower shall be deemed to have elected to
convert all maturing Eurodollar Loans to Base Rate Loans.
(b) Interest Rate Determination. The Agent shall determine
each interest rate applicable to the Revolving Loans hereunder pursuant
to the terms of this Agreement. The Agent shall give prompt notice to
Borrower of each rate of interest so determined and its determination
thereof shall be conclusive absent error.
(c) Conversion Option. Borrower may elect from time to time
(i) to convert all or any part of its Eurodollar Loans to Base Rate
Loans by giving Agent irrevocable notice of such election in writing
prior to 10:00 a.m. (Houston, Texas time) on the conversion date and
such conversion shall be made on the requested conversion date,
provided that any such conversion of Eurodollar Loan shall only be made
on the last day of the Eurodollar Interest Period with respect thereof,
(ii) to convert all or any part of its Base Rate Loans to Eurodollar
Loans by giving the Agent irrevocable written notice of such election
three (3) Eurodollar Business Days prior to the proposed conversion and
such conversion shall be made on the requested conversion date or, if
such requested conversion date is not a Eurodollar Business Day or a
Business Day, as the case may be, on the next succeeding Eurodollar
Business Day or Business Day, as the case may be. Any such conversion
shall not be deemed to be a prepayment of any of the loans for purposes
of this Agreement on the Notes.
(d) Recoupment. If at any time the applicable rate of interest
selected pursuant to Sections 4(a)(i) or 4(a)(ii) above shall exceed
the Maximum Rate, thereby causing the interest on the Notes to be
limited to the Maximum Rate, then any subsequent reduction in the
interest rate so selected or subsequently selected shall not reduce the
rate of interest on the Notes below the Maximum Rate until the total
amount of interest accrued on the Note equals the amount of interest
which would have accrued on the Notes if the rate or rates selected
pursuant to Sections 4(a)(i) or (ii), as the case may be, had at all
times been in effect.
5. Special Provisions Relating to Loans.
(a) Unavailability of Funds or Inadequacy of Pricing. In the
event that, in connection with any proposed Eurodollar Loan, any Bank
(i) shall have determined that U.S. Dollar deposits of the relevant
amount and for the relevant Eurodollar Interest Period for Eurodollar
Loans are not available to such Bank in the London interbank market; or
(ii) in good faith determines that the Eurodollar Interest Rate will
not adequately reflect the cost to the Banks of maintaining or funding
the Eurodollar Loans for such Interest Period, the obligations of the
Banks to make the Eurodollar Loans, as the case may be, shall be
suspended until such time such Bank in its sole discretion reasonably
exercised determines that the event resulting in such suspension has
ceased to exist. If any Bank
-18-
shall make such determination it shall promptly notify the Agent in
writing, and Agent shall promptly notify Borrower in writing, and
Borrower shall either repay the outstanding Eurodollar Loans, as the
case may be, owed to Banks, without penalty, on the last day of the
current Interest Period or convert the same to Base Rate Loans in the
case of Eurodollar Loans on the last day of the then current Interest
Period for such Eurodollar Loan.
(b) Taxes. Both principal and interest on the Notes evidencing
the Loans and all fees due hereunder are payable without withholding or
deduction for or on account of any taxes. If any taxes are levied or
imposed on or with respect to the Notes evidencing the Loans or on any
payment on the Notes evidencing the Loans made to any Bank, then, and
in any such event, Borrower shall pay to the Banks upon demand of any
Bank such additional amounts as may be necessary so that every net
payment of principal and interest on the Notes evidencing the Loans,
after withholding or deduction for or on account of any such taxes,
will not be less than any amount provided for herein. In addition, if
at any time when the Loans are outstanding any laws enacted or
promulgated, or any court of law or governmental agency interprets or
administers any law, which, in any such case, materially changes the
basis of taxation of payments to any Bank of principal of or interest
on the Notes evidencing the Loans by reason of subjecting such payments
to double taxation or otherwise (except through an increase in the rate
of tax on the overall net income of such Bank or Banks) then Borrower
will pay the amount of loss to the extent that such loss is caused by
such a change. The Banks shall give notice to Borrower upon becoming
aware of the amount of any loss incurred by any Bank through enactment
or promulgation of any such law which materially changes the basis of
taxation of payments to one or more of the Banks. The Banks shall also
give notice on becoming aware of any such enactment or promulgation
which may result in such payments becoming subject to double taxation
or otherwise. A certificate of any Bank setting forth the basis for the
determination of such loss and the computation of such amounts shall be
delivered to Borrower and shall be conclusive of such determination and
such amount, absent error. The Borrower shall not be liable to the
Banks for, or be required to pay, any taxes that are on the overall
income or franchise taxes imposed at any time on any Bank by any
governmental agency in any jurisdiction where such Bank conducts
business.
(c) Change in Laws. If at any time any new law or any change
in existing laws or in the interpretation of any new or existing laws
shall make it unlawful for the Banks to maintain or fund its Eurodollar
Loans hereunder, then the Banks shall promptly notify Borrower in
writing and Borrower shall either repay the outstanding Eurodollar
Loans owed to the Banks, without penalty, on the last day of the
current Interest Periods (or, if any Bank may not lawfully continue to
maintain and fund such Eurodollar Loans, immediately), or Borrower may
convert such Eurodollar Loans at such appropriate time to Base Rate
Loans.
-19-
(d) Option to Fund. The Banks shall each have the option if
Borrower elects a Eurodollar Loan, to purchase one or more deposits in
order to fund or maintain its funding of the principal balance of its
Note to which such Eurodollar Loan is applicable during the Interest
Period in question; it being understood that the provisions of this
Agreement relating to such funding are included only for the purpose of
determining the rate of interest to be paid under such Eurodollar Loan
and any amounts owing hereunder and under the Notes. Any Bank shall be
entitled to fund and maintain its funding of all or any part of that
portion of the principal balance of the Notes in any manner it sees
fit, but all such determinations hereunder shall be made as if such
Bank have actually funded and maintained that portion of the principal
balance of the Notes to which a Eurodollar Loan is applicable during
the applicable Interest Period through the purchase of deposits in an
amount equal to the principal balance of the Notes to which such
Eurodollar Loan is applicable and having a maturity corresponding to
such Interest Period. Any Bank may fund the outstanding principal
balance of the Notes which is to be subject to any Eurodollar Loan from
any branch or office of such Bank as any Bank may designate from time
to time.
(e) Indemnity. Borrower shall indemnify and hold harmless the
Banks against all reasonable and necessary out-of-pocket costs and
expenses which the Banks shall sustain (i) as a consequence of any
default by Borrower under this Agreement, or (ii) as a result of the
making of any loan or loans as a Eurodollar Loan under this Agreement
unless any such costs or expenses are caused by the gross negligence or
willful misconduct of any of the Banks, the Agent, the Co-Agent or any
of their employees or agents.
(f) Payments Not at End of Interest Period. If Borrower makes
any payment of principal with respect to any Eurodollar Loan on any day
other than the last day of the Interest Period applicable to such
Eurodollar Loan, then Borrower shall reimburse the Banks on demand for
any loss, cost or expense incurred by the Banks as a result of the
timing of such payment or in redepositing such principal amount,
including the sum of (i) the cost of funds to the Banks in respect of
such principal amount so paid, for the remainder of the Interest Period
applicable to such sum, reduced, if any Bank is able to redeposit such
principal amount so paid for the balance of the Interest Period, by the
interest earned by such Bank as a result of so redepositing such
principal amount, plus (ii) any expense or penalty incurred by the Bank
in redepositing such principal amount. A certificate of any Bank
setting forth the basis for the determination of the amount owed by
Borrower pursuant to this Section 5(f) shall be delivered to Borrower
and shall be conclusive in the absence of manifest error.
6. Collateral and Guaranties. The obligations of the
Borrower to repay (i) with interest all amounts advanced under
the Revolving Commitment as evidenced by the Notes, together with
all renewals, extensions, modifications and/or restatements of
the Revolving
-20-
Commitment and/or the Notes that are from time to time in effect, and (ii) all
fees, costs and expenses of the Banks, including reasonable attorneys' fees
incurred by the Banks under this Agreement (collectively, the "Secured
Obligations") shall be (a) secured by a negative pledge of the Borrower on all
of its assets including without limitation the Rig and (b) guaranteed by an
unconditional guaranty executed by each of the Guarantors in favor of the Banks
dated of even date herewith, said Guaranty to be in the form of Exhibit "C"
hereto.
7. Fees.
(a) Unused Fee. Borrower shall pay to Agent for the ratable
benefit of the Banks an unused commitment fee (the "Unused Commitment
Fee") equivalent to three-eighths of one percent (.375%) per annum
(based on the actual days elapsed in a year consisting of 365 or, if
appropriate, 366 days) on the daily average of the unadvanced portion
of the Revolving Commitment. The Unused Commitment Fee shall be payable
in arrears on the last Business Day of each calendar quarter beginning
September 30, 1997 with the final fee payment due on the Maturity Date
for any period then ending for which the Unused Commitment Fee shall
not have been theretofore paid. In the event the Revolving Commitment
terminates on any date prior to the end of any such monthly period,
Borrower shall pay to the Agent for the ratable benefit of the Banks,
on the date of such termination, the total Unused Commitment Fee due
for the period in which such termination occurs.
(b) Agency Fees. Borrower shall pay to the Agent certain
fees for acting as Agent hereunder in the amounts previously
agreed between Borrower and the Agent.
8. Prepayments.
(a) Voluntary Prepayments. Subject to the provisions of
Sections 2(a) and 5(f) hereof with respect to Eurodollar Loans,
Borrower may at any time and from time to time, without penalty or
premium, prepay the Notes, in whole or in part. Each such prepayment
shall be made on at least one (1) Business Day's notice to Agent and
shall be in a minimum amount of $1,000,000 or any larger multiple
thereof or the unpaid balance on the Notes, whichever is less, plus
accrued interest thereon to the date of prepayment.
(b) Mandatory Prepayment. In the event the Total Outstandings
ever exceed the Revolving Commitment, whether as a result of a
Quarterly Commitment Reduction or otherwise, the Borrower shall
immediately prepay, without premium or penalty, subject to the
provisions of Section 5(f) hereof with respect to Eurodollar Loans, the
principal amount of the Notes in an amount at least equal to such
excess plus accrued but unpaid interest thereon to the date of such
prepayment.
-21-
9. Representations and Warranties. In order to induce the
Banks to enter into this Agreement, Borrower hereby represents
and warrants to the Banks (which representations and warranties
will survive the delivery of the Notes) that:
(a) Creation and Existence. Borrower is a company duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it was formed and is duly qualified in all
jurisdictions wherein failure to qualify may result in a Material
Adverse Effect. Xxxxxx is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in
which it was formed and is duly qualified in all jurisdictions wherein
failure to qualify may result in a Material Adverse Effect. Deep Seas
is a limited partnership duly formed, validly existing and in good
standing under the laws of the state of its formation and is duly
qualified in all jurisdictions wherein failure to qualify may result in
a Material Adverse Effect. The Borrower and the Guarantors each have
all power and authority to own their respective properties and assets
and to transact the business in which it is engaged.
(b) Power and Authority. Borrower is duly authorized and
empowered to create and issue the Notes; and Borrower is duly
authorized and empowered to execute, deliver and perform its
obligations under the Loan Documents to which it is a party, including
this Agreement; and all corporate action on Borrower's part requisite
for the due creation and issuance of the Notes and on Borrower's part
requisite for the due execution, delivery and performance of the Loan
Documents, including this Agreement, has been duly and effectively
taken. Each Guarantor is duly authorized and empowered to execute,
deliver and perform its obligations under the Loan Documents to which
it is a party, including this Agreement and its Guaranty; all corporate
action on each Guarantor's part requisite for the due execution,
delivery and performance of the Loan Documents to which it is a party,
including this Agreement and the Guaranty, has been duly and
effectively taken.
(c) Binding Obligations. This Agreement does, and the Notes
and other Loan Documents upon their creation, issuance, execution and
delivery will, constitute valid and binding obligations of Borrower,
enforceable in accordance with its respective terms (except that
enforcement may be subject to any applicable bankruptcy, insolvency, or
similar debtor relief laws now or hereafter in effect and relating to
or affecting the enforcement of creditors rights generally). This
Agreement does and the Guaranty upon its creation, issuance, execution
and delivery will, constitute valid and binding obligations of each
Guarantor enforceable in accordance with its respective terms (except
that enforcement may be subject to any applicable bankruptcy,
insolvency, or similar debtor relief laws now or hereafter in effect
and relating to or affecting the enforcement of creditors rights
generally).
-22-
(d) No Legal Bar or Resultant Lien. The Notes and the Loan
Documents, including this Agreement and the Guaranty, do not and will
not, to the best of Borrower's and each Guarantor's knowledge, violate
any provisions of any material contract, agreement, law, regulation,
order, injunction, judgment, decree or writ to which Borrower or either
Guarantor is subject, or result in the creation or imposition of any
lien or other encumbrance upon any assets or properties of Borrower or
either Guarantor, other than those contemplated by this Agreement.
(e) No Consent. Neither the execution, delivery and
performance by Borrower of the Notes and the Loan Documents, including
this Agreement nor the execution, delivery and performance by the
Guarantors of this Agreement and the Guaranty, requires the consent or
approval of any other person or entity, including without limitation
any regulatory authority or governmental body of the United States or
any state thereof or any political subdivision of the United States or
any state thereof.
(f) Financial Condition. The unaudited Financial Statements of
Xxxxxx dated March 31, 1997, which have been delivered to the Agent are
complete and correct in all material respects, and fairly and
accurately reflect in all material respects the financial condition and
results of the operations of Borrower as of the date or dates and for
the period or periods stated. No change has since occurred in the
condition, financial or otherwise, of Borrower which is reasonably
expected to have a Material Adverse Effect, except as disclosed to the
Banks in Schedule "2" attached hereto.
(g) Liabilities. Neither Borrower nor any Subsidiary has any
material (individually or in the aggregate) liability, direct or
contingent, except as disclosed to the Banks in the Financial
Statements and on Schedule "3" attached hereto. No unusual or unduly
burdensome restrictions, restraint, or hazard exists by contract, law
or governmental regulation or otherwise relative to the business,
assets or properties of Borrower or any Subsidiary which is reasonably
expected to have a Material Adverse Effect.
(h) Litigation. Except as described in the Financial
Statements, or as otherwise disclosed to the Banks in Schedule "4"
attached hereto, there is no litigation, legal or administrative
proceeding, investigation or other action of any nature pending or, to
the knowledge of the officers of Borrower or any Subsidiary threatened
against or affecting Borrower or any Subsidiary which involves the
possibility of any judgment or liability not fully covered by
insurance, and which is reasonably expected to have a Material Adverse
Effect.
(i) Taxes; Governmental Charges. Borrower and each of its
Subsidiaries have filed all tax returns and reports required to
be filed and has paid all taxes, assessments, fees and other
governmental charges levied upon it or its assets, properties or
income
-23-
which are due and payable, including interest and penalties, the
failure of which to pay could reasonably be expected to have a Material
Adverse Effect, except such as are being contested in good faith by
appropriate proceedings and for which adequate reserves for the payment
thereof as required by GAAP has been provided and levy and execution
thereon have been stayed and continue to be stayed.
(j) Titles, Etc. Borrower and each of its Subsidiaries have
good and defensible title to all of their respective assets, including
without limitation, the Xxxxxx Falcon offshore drilling rig (the
"Rig"), free and clear of all liens or other encumbrances except
Permitted Liens.
(k) Defaults. Neither Borrower nor any Subsidiary is in
default and no event or circumstance has occurred which, but for the
passage of time or the giving of notice, or both, would constitute a
default under any loan or credit agreement, indenture, mortgage, deed
of trust, security agreement or other agreement or instrument to which
Borrower or any Subsidiary are a party in any respect that would be
reasonably expected to have a Material Adverse Effect. No Event of
Default hereunder has occurred and is continuing.
(l) Casualties; Taking of Properties. Since the dates of the
latest Consolidated Financial Statements of Xxxxxx delivered to Banks,
neither the business nor the assets or properties of Borrower or any
Subsidiary have been affected (to the extent it is reasonably likely to
cause a Material Adverse Effect) as a result of any fire, explosion,
earthquake, flood, drought, windstorm, accident, strike or other labor
disturbance, embargo, requisition or taking of property or cancellation
of contracts, permits or concessions by any domestic or foreign
government or any agency thereof, riot, activities of armed forces or
acts of God or of any public enemy.
(m) Use of Proceeds; Margin Stock. The availability under the
Revolving Commitment will be used by Borrower for the purposes of (i)
funding of capital expenditures to upgrade and modernize existing fleet
of offshore drilling rigs, (ii) working capital and (iii) general
corporate purposes. Borrower is not engaged principally or as one of
its important activities in the business of extending credit for the
purpose of purchasing or carrying any "margin stock" as defined in
Regulation U of the Board of Governors of the Federal Reserve System
(12 C.F.R. Part 221), or for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry a
margin stock or for any other purpose which might constitute this
transaction a "purpose credit" within the meaning of said Regulation U.
Neither Borrower nor any person or entity acting on behalf of
Borrower has taken or will take any action which might cause the loans
hereunder or any of the Loan Documents, including this Agreement, to
violate Regulation U or any other regulation of
-24-
the Board of Governors of the Federal Reserve System or to violate the
Securities Exchange Act of 1934 or any rule or regulation thereunder,
in each case as now in effect or as the same may hereafter be in
effect.
(n) Location of Business and Offices. The principal place of
business and chief executive offices of Borrower is located at
the address stated in Section 16 hereof.
(o) Compliance with the Law. To the best of Borrower's
knowledge, neither Borrower nor any Subsidiary:
(i) is in violation of any law, judgment, decree, order,
ordinance, or governmental rule or regulation to which Borrower,
or any of its assets or properties are subject; or
(ii) has failed to obtain any license, permit, franchise or
other governmental authorization necessary to the ownership of
any of its assets or properties or the conduct of its business;
which violation or failure is reasonably expected to have a
Material Adverse Effect.
(p) No Material Misstatements. No information, exhibit or
report furnished by Borrower to the Banks in connection with the
negotiation of this Agreement contained any material misstatement of
fact or omitted to state a material fact or any fact necessary to make
the statement contained therein not materially misleading.
(q) ERISA. Borrower and each Subsidiary is in compliance in
all material respects with the applicable provisions of ERISA, and no
"reportable event", as such term is defined in Section 403 of ERISA,
has occurred with respect to any Plan of Borrower.
(r) Public Utility Holding Company Act. Borrower is not a
"holding company", or "subsidiary company" of a "holding company", or
an "affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", or a "public utility" within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
(s) Environmental Matters.
(i) The Borrower has duly complied in all material
respects with, and the Rig and other properties and operations
are in compliance in all material respects with, the
provisions of all applicable environmental, health and safety
laws, codes and ordinances and all rules and regulations
promulgated thereunder
-25-
of all Governmental Authorities unless such compliance would
violate the laws or regulations of the jurisdiction in which
the Rig is operating.
(ii) As of the date of this Agreement, except as
disclosed to the Agent in writing or Schedule "6" hereto, the
Borrower has received no notice from any Governmental
Authority, and have no knowledge, of any fact(s) which
constitute a violation of any applicable environmental, health
or safety laws, codes or ordinances, and any rules or
regulations promulgated thereunder of all Governmental
Authorities, which relate to the use or ownership of the Rig
or other properties owned or operated by the Borrower.
(iii) The Borrower has been issued all required
permits, licenses, certificates and approvals of all
Governmental Authorities relating to (i) air emissions, (ii)
discharges to surface water or ground water, (iii) noise
emissions, (iv) solid or liquid waste disposal, (v) the use,
operation, storage, transportation, treatment, recycling or
disposal of Hazardous Substances or (vi) other environmental,
health or safety matters necessary for the ownership or
operation of the Rig or other properties owned or operated by
the Borrower and such permits, licenses, certificates and
approvals are in full force and effect on the date of this
Agreement.
(iv) Except as disclosed to the Agent in writing or
Schedule "6" hereto, to the best of the Borrower's knowledge,
except in accordance with a valid governmental permit,
license, certificate or approval, there has been no spill or
unauthorized discharge or release of any Hazardous Substance
to the environment at, from, or as a result of any operations
on the Rig or other properties and operations owned or
operated by the Borrower required to be reported to any
Governmental Authority.
(v) Except as disclosed to the Agent in writing or
Schedule "6" hereto, there has been no material complaint,
compliance order, compliance schedule, notice letter, notice
of citation or other similar notice from any environmental
agency which concerns the operations of the Rig or other
properties owned or operated by the Borrower.
(t) Liens. Except (i) as disclosed on Schedule "1" hereto
and (ii) for Permitted Liens, the assets and properties of
Borrower are free and clear of all liens and encumbrances.
(u) Subsidiaries. All of Borrower's Subsidiaries are listed
on Schedule "5" hereto.
-26-
10. Conditions of Lending.
(a) The effectiveness of this Agreement, and the obligation to
make the initial Advance under the Revolving Commitment shall be
subject to satisfaction of the following conditions precedent:
(i) Execution and Delivery. Borrower shall have executed and
delivered the Agreement, the Notes and other required documents,
all in form and substance satisfactory to the Agent;
(ii) Guarantors' Execution and Delivery. Each Guarantor
shall have executed and delivered to Agent this Agreement, the
Guaranty and other required documents, all in form and substance
satisfactory to Agent;
(iii) Legal Opinion. The Agent shall have received from
Borrower's and Guarantors' legal counsel a favorable legal
opinion in form and substance satisfactory to Agent;
(iv) Corporate Resolutions. The Agent shall have received
appropriate certified corporate resolutions of Borrower, Xxxxxx
and the general partner of Deep Seas;
(v) Good Standing. The Agent shall have received evidence of
existence and good standing for Borrower and the Guarantors;
(vi) Incumbency. The Agent shall have received a
signed certificate of Borrower and each Guarantor certifying
the names of the officers of Borrower and the Guarantors (or,
in the case of Deep Seas, its general partner) authorized to
sign loan documents on behalf of Borrower and the Guarantors,
together with the true signatures of each such officer. The
Agent may conclusively rely on such certificate until the
Agent receives a further certificate of Borrower or the
Guarantors canceling or amending the prior certificate and
submitting signatures of the officers, named in such further
certificate;
(vii) Memorandum and Articles of Association. The
Agent shall have received copies of the Memorandum and
Articles of Association of Borrower and all amendments
thereto, certified by the appropriate Governmental Authority
of the jurisdiction of its incorporation, and a copy of the
bylaws, if any, of Borrower certified by Borrower as being
true, correct and complete;
(viii) Payment of Fees. The Agent shall have received
payment in full of all fees due at the Effective Date.
-27-
(ix) Representation and Warranties. The
representations and warranties of Borrower under this
Agreement are true and correct in all material respects as of
such date, as if then made (except to the extent that such
representations and warranties related solely to an earlier
date);
(x) No Event of Default. No Default or Event of Default
shall have occurred and be continuing;
(xi) Other Documents. Agent shall have received such other
instruments and documents incidental and appropriate to the
transaction provided for herein as Bank or its counsel may
reasonably request, and all such documents shall be in form and
substance reasonably satisfactory to the Agent; and
(xii) Legal Matters Satisfactory. All legal matters incident
to the consummation of the transactions contemplated hereby shall
be reasonably satisfactory to special counsel for Agent retained
at the expense of Borrower.
(b) The obligation of the Banks to make any Advance on the
Revolving Commitment (including the initial Advance) shall be subject
to the following additional conditions precedent that, at the date of
making each such Advance and after giving effect thereto:
(i) Representation and Warranties. The
representations and warranties of Borrower under this
Agreement are true and correct in all material respects as of
such date, as if then made (except to the extent that such
representations and warranties related solely to an earlier
date);
(ii) No Event of Default. No Default or Event of Default
shall have occurred and be continuing;
(iii) Other Documents. Agent shall have received such other
instruments and documents incidental and appropriate to the
transaction provided for herein as Agent or its counsel may
reasonably request, and all such documents shall be in form and
substance reasonably satisfactory to the Agent; and
(iv) Legal Matters Satisfactory. All legal matters incident
to the consummation of the transactions contemplated hereby shall
be reasonably satisfactory to special counsel for Agent retained
at the expense of Borrower.
11. Affirmative Covenants. The Borrower covenants and agrees
with the Banks, the Agent and the Co-Agent that, so long as any
Revolving Commitment, Revolving Loan or any fee,
-28-
expense, or any other amount payable under any Loan Document shall remain unpaid
and outstanding:
(a) Financial Statements and Reports. Borrower shall promptly
furnish to the Banks from time to time upon request such information
regarding the business and affairs and financial condition of Borrower,
as the Banks may reasonably request, and will furnish, or cause Xxxxxx
to furnish, to the Banks:
(i) Annual Financial Statements. As soon as
available, and in any event within ninety (90) days after the
close of each fiscal year, the annual audited consolidated
Financial Statements and unaudited consolidating Financial
Statements of Xxxxxx, prepared in accordance with GAAP and in
a manner consistent with prior years;
(ii) Quarterly Financial Statements. As soon as
available, and in any event within forty-five (45) days after
the end of each calendar quarter of each year (except the last
calendar quarter of any fiscal year), the quarterly unaudited
consolidated and consolidating Financial Statements of Xxxxxx
prepared in accordance with GAAP and in a manner consistent
with prior periods;
(iii) Rig Employment Report. As soon as available,
and in any event within sixty (60) days of the end of each
calendar quarter of each year, the quarterly Rig employment
report of Borrower setting forth the location, charter, term,
and rate for the Rig as of the date of such report, such
reports to be in form and substance satisfactory to Agent and
the Co-Agent; and
(iv) Additional Information. Promptly upon request of the
Agent from time to time any additional financial information or
other information that the Agent may reasonably request.
All such reports, information, balance sheets and Financial Statements
referred to in Subsection 11(a) above shall be in such detail as the
Agent may reasonably request.
(b) Certificates of Compliance. Concurrently with the
furnishing of the annual Financial Statements pursuant to Subsection
11(a)(i) hereof and the quarterly unaudited Financial Statements
pursuant to Subsection 11(a)(ii) hereof, Borrower will furnish or cause
to be furnished to the Agent a certificate in the form of Exhibit "C"
attached hereto, signed by the President or Chief Financial Officer of
Borrower.
(c) Taxes and Other Liens. Borrower shall and shall cause
each Subsidiary to pay and discharge promptly all lawful taxes,
assessments and governmental charges or levies imposed upon
Borrower or any Subsidiary or upon the income or any assets or
-29-
property of Borrower or any Subsidiary as well as all claims of any
kind (including claims for labor, materials, supplies and rent) which,
if unpaid, might become a Lien or other encumbrance upon any or all of
the assets or property of Borrower or any Subsidiary and which could
reasonably be expected to result in a Material Adverse Effect;
provided, however, that the Borrower and its Subsidiaries shall not be
required to pay any such tax, assessment, charge, levy or claim if the
amount, applicability or validity thereof shall currently be contested
in good faith by appropriate proceedings diligently conducted, levy and
execution thereon have been stayed and continue to be stayed and if
Borrower or such Subsidiary shall have set up adequate reserves
therefor, if required, under GAAP.
(d) Compliance with Laws. Borrower shall and shall cause each
Subsidiary to observe and comply with all applicable laws, statutes,
codes, acts, ordinances, orders, judgments, decrees, injunctions,
rules, regulations, orders and restrictions relating to environmental
standards or controls or to energy regulations of all federal, state,
county, municipal and other governments, departments, commissions,
boards, agencies, courts, authorities, officials and officers, domestic
or foreign, where the failure to so observe and comply is reasonably
expected to have a Material Adverse Effect.
(e) Further Assurances. Borrower will cure promptly any
defects in the creation and issuance of the Note and the execution and
delivery of the Notes and the Loan Documents, including this Agreement.
Borrower at its sole expense will promptly execute and deliver to Agent
upon its reasonable request all such other and further documents,
agreements and instruments in compliance with or accomplishment of the
covenants and agreements in this Agreement, or to correct any omissions
in the Note or more fully to state the obligations set out herein.
(f) Performance of Obligations. Borrower will pay the Notes
and other obligations incurred by it hereunder according to the
reading, tenor and effect thereof and hereof.
(g) Insurance. The Borrower and each Subsidiary now maintains
and will continue to maintain insurance with financially sound and
reputable insurers with respect to their respective assets against such
liabilities, fires, casualties, risks and contingencies and at such
types and amounts as is customary in the case of persons engaged in the
same or similar businesses or similarly situated and in amounts which
are consistent with prudent business practices. Upon the request of the
Agent, the Borrower will furnish or cause to be furnished to the Agent
from time to time a summary of each respective insurance company of the
Borrower and its Subsidiaries, will provide the Agent with copies of
all policies covering Borrower's Rig and its other material assets.
(h) Accounts and Records. Borrower and each Subsidiary will
keep books, records and accounts in which full, true and correct
entries will be made of all dealings
-30-
or transactions in relation to its business and activities, prepared in
a manner consistent with prior years, subject to changes suggested by
Borrower's or any Subsidiary's auditors.
(i) Right of Inspection. Borrower and each Subsidiary will
permit any officer, employee or agent of the Agent and the Co-Agent, at
their expense, to (A) examine Borrower's and each Subsidiary's books,
records and accounts, and take copies and extracts therefrom, and (B)
inspect the Rig, all at such reasonable times during normal business
hours and as often as the Agent or Co-Agent may reasonably request.
(j) Notice of Certain Events. Borrower shall promptly notify
the Agent if Borrower learns of the occurrence of (i) any event which
constitutes an Event of Default together with a detailed statement by
Borrower of the steps being taken to cure the Event of Default; or (ii)
any legal, judicial or regulatory proceedings affecting Borrower, any
Subsidiary, or any of the material assets or properties of Borrower or
any Subsidiary which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect; or (iii) any dispute
between Borrower or any Subsidiary and any governmental or regulatory
body or any other person or entity which, if adversely determined,
might reasonably be expected to cause a Material Adverse Effect; or
(iv) any other matter which in Borrower's opinion is reasonably
expected to have a Material Adverse Effect.
(k) ERISA Information and Compliance. Borrower shall and shall
cause each Subsidiary to promptly furnish to the Agent immediately upon
becoming aware of the occurrence of any "reportable event", as such
term is defined in Section 4043 of ERISA, or of any "prohibited
transaction", as such term is defined in Section 4975 of the Internal
Revenue Code of 1954, as amended, in connection with any Plan or any
trust created thereunder, a written notice signed by the chief
financial officer of Borrower or such Subsidiary specifying the nature
thereof, what action Borrower or such Subsidiary is taking or proposes
to take with respect thereto, and, when known, any action taken by the
Internal Revenue Service with respect thereto.
(l) Environmental Compliance.
(i) The Borrower and its Subsidiaries will comply
with and will use their best efforts to cause their agents,
contractors and sub-contractors (while such Persons are acting
within the scope of their contractual relationship with the
Borrower and the Subsidiaries) to so comply with (A) all
applicable environmental, health and safety laws, codes and
ordinances, and all rules and regulations promulgated
thereunder of all Governmental Authorities and (B) the terms
and conditions of all applicable permits, licenses,
certificates and approvals of all Governmental Authorities now
or hereafter granted or obtained with respect to the Rig or
other properties owned or operated by the Borrower or the
-31-
Subsidiaries unless such compliance would violate the laws or
regulations of the jurisdictions in which the Rig is
operating.
(ii) The Borrower and its Subsidiaries will use their
best efforts and safety practices to prevent the unauthorized
release, discharge, disposal, escape or spill of Hazardous
Substances on or about the Rig or other properties owned or
operated by the Borrower or its Subsidiaries.
(m) Environmental Notifications. The Borrower shall notify
the Agent, in writing, within five (5) Business Days of any of
the following events occurring after the date of this Agreement:
(i) Any written notification made by Borrower or any
of the Subsidiaries to any federal, state or local
environmental agency required under any federal, state or
local environmental statute, regulation or ordinance relating
to a spill or unauthorized discharge or release of any
Hazardous Substance to the environment at, from, or as a
result of any operations on, the Rig or other properties and
operations owned or operated by the Borrower or any
Subsidiary.
(ii) Knowledge by an officer of the Borrower or any
Subsidiary of receipt of service by Borrower or any Subsidiary
of any complaint, compliance order, compliance schedule,
notice letter, notice of violation, citation or other similar
notice or any judicial demand by any court, federal, state or
local environmental agency, alleging (A) any spill,
unauthorized discharge or release of any Hazardous Substance
to the environment from, or as a result of the operations on,
the Rig or other properties owned or operated by the Borrower
or any Subsidiary or (B) violations of applicable laws,
regulations or permits regarding the generation, storage,
handling, treatment, transportation, recycling, release or
disposal of Hazardous Substances on or as a result of
operations on the Rig or other properties and operations owned
or operated by the Borrower or the respective Subsidiary.
(iii) It is understood by the parties hereto that the
aforementioned notices are solely for the Agent's information,
may not otherwise be required by any federal, state or local
environmental laws, regulations or ordinances, and are to be
considered confidential information by the Banks and the
Agent.
(iv) The term "environmental agency" as used herein shall
include, but not be limited to, the United States Environmental
Protection Agency, the United States Coast Guard, the United
States Mineral Management Service, the United States Department
of Transportation (in its administration of the Hazardous
Materials Transportation Act, 49 U.S.C. Sec. 1801, et seq.) and
other analogous
-32-
or similar Governmental Authorities regulating or
administering statutes, regulations or ordinances relating to
or imposing liability or standards of conduct concerning the
generation, storage, use, production, transportation,
handling, treatment, recycling, release or disposal of any
Hazardous Substance.
(n) Environmental Indemnifications. The Borrower hereby agrees
to indemnify and hold the Agent, the Co-Agent and the Banks jointly and
severally harmless from and against any and all claims, losses,
liability, damages and injuries of any kind whatsoever asserted against
the Agent, the Co-Agent and the Banks with respect to or as a direct
result of the presence, escape, seepage, spillage, release, leaking,
discharge or migration from the Rig or other properties owned or
operated by the Borrower or any Subsidiary of any Hazardous Substance,
including without limitation, any claims asserted or arising under any
applicable environmental, health and safety laws, codes and ordinances,
and all rules and regulations promulgated thereunder of all
Governmental Authorities, regardless of whether or not caused by or
within the control of the Borrower or any Subsidiary.
(o) Change of Principal Place of Business. Borrower shall give
Agent at least thirty (30) days prior written notice of its intention
to move its principal place of business from the address set forth in
Section 16 hereof.
(p) Payables and Other Indebtedness. Borrower and each
Subsidiary shall pay their trade payables and other Debt that arise in
the ordinary course of business promptly as they become due except to
the extent any such trade payables or Debt are being contested in good
faith.
(q) Maintenance of Rig. The Borrower will maintain, or cause
to be maintained, the Rig in the highest classification for such
drilling rigs with the American Bureau of Shipping or such other
classification society as the Agent and the Co-Agent may approve.
12. Negative Covenants. The Borrower and, with respect to Subsection
12(b) hereof, the Guarantors covenant and agree with the Banks, the Agent and
the Co-Agent that, so long as any Revolving Commitment, Revolving Loan or any
fee, expense, or any other amount payable under any Loan Document shall remain
unpaid and outstanding:
(a) Negative Pledge. Neither the Borrower nor any of its
Subsidiaries shall without the prior written consent of the
Banks:
(i) create, incur, assume or permit to exist any
Lien, security interest or other encumbrance on any of its
assets or properties now owned or hereafter acquired, except
Permitted Liens; or
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(ii) sell, lease, transfer or otherwise dispose of,
in any fiscal year, any of its material assets or properties,
except for (1) sales, leases, transfers, charters (including
drilling contracts) or other dispositions made in the ordinary
course of the Borrower's business and (2) sales, leases,
transfers, charters (including drilling contracts) or other
dispositions between Borrower and a Subsidiary.
(b) Financial Covenants of Guarantors:
(i) Current Ratio. Guarantors will not allow the ratio of
Consolidated Current Assets to Consolidated Current Liabilities
to be less than 1.25 to 1.0 as of the end of any fiscal quarter.
(ii) Funded Debt to EBITDA. Guarantors will not allow
the ratio of (i) Consolidated Funded Debt to (ii) Consolidated
EBITDA for the most recent fiscal quarter annualized, to be
greater than 2.5 to 1.0, as of the end of any fiscal quarter.
(iii) Debt Service Coverage Ratio. Guarantors will not allow
the ratio of Consolidated Adjusted EBITDA to Consolidated Debt
Service to be less than 1.25 to 1.0 as of the end of any fiscal
quarter.
(iv) Funded Debt to Tangible Net Worth. Guarantors will not
allow the ratio of Consolidated Funded Debt to Consolidated
Tangible Net Worth to be more than .9 to 1.0 as of the end of any
fiscal quarter.
(v) Tangible Net Worth. Guarantors will not allow the
Consolidated Tangible Net Worth to be less than $110,000,000
plus fifty percent (50%) of Guarantors' Consolidated Net
Income, if positive, after December 31, 1996, tested at the
end of each fiscal quarter.
(c) Consolidations and Mergers. Neither the Borrower nor any
Subsidiary will consolidate or merge with or into any other Person,
except that the Borrower or any Subsidiary may merge with another
Person if Borrower or such Subsidiary is the surviving entity in such
merger, and any Subsidiary may merge with any Subsidiary, if, after
giving effect to any such merger or consolidation, no Default or Event
of Default shall have occurred and be continuing.
(d) Debts, Guaranties and Other Obligations. Neither of the
Borrower nor any of its Subsidiaries will incur, create, assume or in
any manner become or be liable in respect of any Debt, nor will
Borrower or any Subsidiary guarantee or otherwise in any manner become
or be liable in respect of any indebtedness, liabilities or other
obligations of any other person or entity, whether by agreement to
purchase the indebtedness of any
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other person or entity or agreement for the furnishing of funds to any
other person or entity through the purchase or lease of goods, supplies
or services (or by way of stock purchase, capital contribution, advance
or loan) for the purpose of paying or discharging the indebtedness of
any other person or entity, or otherwise, except that the foregoing
restrictions shall not apply to:
(i) the Notes and any renewal or increase thereof; or
(ii) indebtedness owed to Philadelphia Falcon Drilling Corp.
or its assignees in the principal amount owed at the Effective
Date; or
(iii) indebtedness (other than for borrowed money) incurred
in connection with the refurbishment and upgrade of the Rig; or
(iv) taxes, assessments or other government charges
which are not yet due or are being contested in good faith by
appropriate action promptly initiated and diligently
conducted, if such reserve as shall be required by GAAP shall
have been made therefor and levy and execution thereon have
been stayed and continue to be stayed; or
(v) indebtedness for insurance premiums incurred in the
ordinary course of business; or
(vi) inter-company indebtedness between Borrower and
Guarantors permitted by the Guarantors' Credit Agreement; or
(vii) renewals or extensions (but not increases in) of any
or all of the foregoing.
(e) Dividends. Borrower will not declare or pay any dividend,
purchase, redeem or otherwise acquire for value any of its stock now or
hereafter outstanding, return any capital to its stockholders, or make
any distribution of its assets to its stockholders as such, except the
foregoing shall not apply to dividends from Borrower to Xxxxxx.
(f) Loans and Advances. Neither Borrower nor any of its
Subsidiaries shall make or permit to remain outstanding any loans or
advances to or in any person or entity, except that the foregoing
restriction shall not apply to:
(i) loans or advances to any person, the material
details of which have been set forth in the Financial
Statements of Xxxxxx heretofore furnished to Banks as listed
on Schedule "7" hereto; or
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(ii) inter-company loans or advances between the Borrower
and the Guarantors permitted by the Guarantors' Credit Agreement.
(g) Sale or Discount of Receivables. Neither Borrower nor any
Subsidiary will discount (other than normal trade discounts) or sell
with recourse, or sell for less than the greater of the face or market
value thereof, any of its notes receivable or accounts receivable.
(h) Nature of Business. Neither Borrower nor any Subsidiary
will permit any material change to be made in the character of
its business as carried on at the date hereof.
(i) Transactions with Affiliates. Neither Borrower nor any
Subsidiary will enter into any transaction with any Affiliate, except
transactions upon terms that are no less favorable to it than would be
obtained in a transaction negotiated at arm's length with an unrelated
third party.
(j) Investments. Neither Borrower nor any Subsidiary shall
make any investment in any person or entity, except such
restriction shall not apply to:
(i) investments existing at the Effective Date as disclosed
in the Financial Statements;
(ii) investments in Subsidiaries; and
(iii) investments consisting of Cash Equivalents.
(k) Amendment to Charter Documents. Neither Borrower nor any
Subsidiary will permit any amendment to, or any alteration of,
its Memorandum and Articles of Association.
(l) Management of Rig. Borrower will not change the flag,
class, ownership, management or control of the Rig without the prior
written consent of the Agent and the Co-Agent.
(m) Modification of Rig. Borrower shall not cause or allow any
change in the physical characteristics of the Rig that would, in the
reasonable judgment of the Agent and Co-Agent, materially interfere
with the suitability of the Rig for normal commercial offshore drilling
operations, the consent of the Agent and Co-Agent to any such
modification not to be unreasonably withheld.
-36-
(n) Sale of Rigs, etc. Borrower shall not sell, transfer or
assign any of the Rig, or any right to receive the revenue from the
Rig; provided, however, that the Borrower may sell, transfer or assign
any surplus or scrap equipment from the Rig.
13. Events of Default. Any one or more of the following
events shall be considered an "Event of Default" as that term is
used herein:
(a) Borrower shall fail to pay when due or declared due the
principal of, and the interest on, the Notes, or any fee or any other
material indebtedness of Borrower incurred pursuant to this Agreement
or any other Loan Document; or
(b) Any representation or warranty made under this Agreement,
or in any certificate or statement furnished or made to the Banks
pursuant hereto, or in connection herewith, or in connection with any
document furnished hereunder, shall prove to be untrue in any material
respect as of the date on which such representation or warranty is made
(or deemed made), or any representation, statement (including financial
statements), certificate, report or other data furnished or to be
furnished or made under any Loan Document, including this Agreement,
proves to have been untrue in any material respect, as of the date as
of which the facts therein set forth were stated or certified; or
(c) Default shall be made in the due observance or performance
of any of the covenants or agreements contained in the Loan Documents,
including this Agreement (excluding covenants contained in Section 12
of the Agreement for which there is no cure period), and such default
shall continue for more than thirty (30) days after the giving of
written notice thereof by the Agent to the Borrower; or
(d) Default shall be made in the due observance or
performance of the covenants contained in Section 12 of this
Agreement; or
(e) Default shall be made in respect of any obligation for
borrowed money, other than the Notes, for which Borrower or any
Subsidiary is liable (directly, by assumption, as guarantor or
otherwise), or any obligations secured by any mortgage, pledge or other
security interest, lien, charge or encumbrance with respect thereto, on
any asset or property of Borrower or any Subsidiary or in respect of
any agreement relating to any such obligations unless neither Borrower
nor any Subsidiary is liable for same (i.e., unless remedies or
recourse for failure to pay such obligations is limited to foreclosure
of the collateral security therefor), and if such default shall
continue beyond the applicable grace period, if any; or
(f) Borrower or any Subsidiary shall commence a voluntary case
or other proceedings seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or
-37-
seeking an appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property,
or shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as
they become due, or shall take any corporate action authorizing the
foregoing; or
(g) An involuntary case or other proceeding, shall be
commenced against Borrower or any Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its
property, and such involuntary case or other proceeding shall remain
undismissed and unstayed for a period of thirty (30) days; or an order
for relief shall be entered against Borrower or any Subsidiary under
the federal bankruptcy laws as now or hereinafter in effect; or
(h) A final judgment or order for the payment of money in
excess of $1,000,000 (or judgments or orders aggregating in excess of
$1,000,000) shall be rendered against Borrower or any Subsidiary and
such judgments or orders shall continue unsatisfied and unstayed for a
period of thirty (30) days unless such judgment or orders are fully
covered by insurance or supersedeas bond; or
(i) In the event the aggregate principal amount outstanding
under the Notes shall at any time exceed the Revolving Commitment
established for the Notes, and Borrower shall fail to comply with the
provisions of Section 8(b) hereof; or
(j) A Change of Management shall occur without the prior
written consent of the Banks, which consent shall not be
unreasonably withheld; or
(k) Default shall occur under Guarantors' Credit Agreement.
Upon occurrence of any Event of Default specified in Subsections 13(f)
and (g) hereof, the entire principal amount due under the Notes and all interest
then accrued thereon, and any other liabilities of Borrower hereunder, shall
become immediately due and payable all without notice and without presentment,
demand, protest, notice of protest or dishonor or any other notice of default of
any kind, all of which are hereby expressly waived by Borrower. In any other
Event of Default, the Agent, upon request of Majority Banks, shall by notice in
writing to Borrower declare the principal of, and all interest then accrued on,
the Notes and any other liabilities hereunder to be forthwith due and payable,
whereupon the same shall forthwith become due and payable without presentment,
demand, protest, notice of intent to accelerate, notice of acceleration or other
notice of any kind, all of which Borrower hereby expressly waives, anything
contained herein or in the Notes to the contrary notwithstanding. Nothing
contained in this
-38-
Section 13 shall be construed to limit or amend in any way the Events of Default
enumerated in the Notes, or any other document executed in connection with the
transaction contemplated herein.
Upon the occurrence and during the continuance of any Event of Default,
the Banks are hereby authorized at any time and from time to time and to the
extent permitted by applicable law, without notice to Borrower (any such notice
being expressly waived by Borrower), to set-off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by any of the Banks to or for the credit or
the account of Borrower against any and all of the indebtedness of Borrower
under the Notes and the Loan Documents, including this Agreement, irrespective
of whether or not the Banks shall have made any demand under the Loan Documents,
including this Agreement or the Notes and although such indebtedness may be
unmatured. Any amount set-off by any of the Banks shall be applied against the
indebtedness owed the Banks by Borrower pursuant to this Agreement and the
Notes. The Banks agree promptly to notify Borrower after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Bank under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Banks may have.
14. The Agent and the Banks.
(a) Appointment and Authorization. Each Bank hereby appoints
Agent as its nominee and agent, in its name and on its behalf: (i) to
act as nominee for and on behalf of such Bank in and under all Loan
Documents; (ii) to arrange the means whereby the funds of Banks are to
be made available to Borrower under the Loan Documents; (iii) to take
such action as may be requested by any Bank under the Loan Documents
(when such Bank is entitled to make such request under the Loan
Documents); (iv) to receive all documents and items to be furnished to
Banks under the Loan Documents; (v) to be the secured party, mortgagee,
beneficiary, and similar party in respect of, and to receive, as the
case may be, any collateral for the benefit of Banks; (vi) to promptly
distribute to each Bank all material information, requests, documents
and items received from Borrower under the Loan Documents; (vii) to
promptly distribute to each Bank such Bank's Pro Rata Part of each
payment or prepayment (whether voluntary, as proceeds of insurance
thereon, or otherwise) in accordance with the terms of the Loan
Documents and (viii) to deliver to the appropriate Persons requests,
demands, approvals and consents received from Banks. Each Bank hereby
authorizes Agent to take all actions and to exercise such powers under
the Loan Documents as are specifically delegated to such Agent by the
terms hereof or thereof, together with all other powers reasonably
incidental thereto. With respect to its commitments hereunder and the
Notes issued to it, Agent and any successor Agent shall have the same
rights under the Loan Documents as any other Bank and may exercise the
same as though it were not the Agent; and the term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include Agent and any
successor
-39-
Agent in its capacity as a Bank. Agent and any successor Agent and its
Affiliates may accept deposits from, lend money to, act as trustee
under indentures of and generally engage in any kind of business with
Borrower, and any person which may do business with Borrower, all as if
Agent and any successor Agent were not Agent hereunder and without any
duty to account therefor to the Banks; provided that, if any payments
in respect of any property (or the proceeds thereof) now or hereafter
in the possession or control of Agent which may be or become security
for the obligations of Borrower arising under the Loan Documents by
reason of the general description of indebtedness secured or of
property contained in any other agreements, documents or instruments
related to any such other business shall be applied to reduction of the
obligations of Borrower arising under the Loan Documents, then each
Bank shall be entitled to share in such application according to its
pro rata part thereof. Each Bank, upon request of any other Bank, shall
disclose to all other Banks all indebtedness and liabilities, direct
and contingent, of Borrower to such Bank as of the time of such
request.
(b) Note Holders. From time to time as other Banks become a
party to this Agreement, Agent shall obtain execution by Borrower of
additional Notes, in the form of Exhibit B hereto, in amounts
representing the Revolving Commitment of each such new Bank, up to an
aggregate face amount of all Notes not exceeding $25,000,000. The
obligation of such Bank shall be governed by the provisions of this
Agreement, including but not limited to, the obligations specified in
Section 2 hereof. From time to time, Agent may require that the Banks
exchange their Notes for newly issued Notes to better reflect the
Revolving Commitments of the Banks. Agent may treat the payee of any
Note as the holder thereof until written notice of transfer has been
filed with it, signed by such payee and in form satisfactory to Agent.
(c) Consultation with Counsel. Banks agree that Agent may
consult with legal counsel selected by Agent and shall not be liable
for any action taken or suffered in good faith by it in accordance with
the advice of such counsel.
(d) Documents. Agent shall not be under a duty to examine or
pass upon the validity, effectiveness, enforceability, genuineness or
value of any of the Loan Documents or any other instrument or document
furnished pursuant thereto or in connection therewith, and Agent shall
be entitled to assume that the same are valid, effective, enforceable
and genuine and what they purport to be.
(e) Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below,
Agent may resign at any time by giving written notice thereof to Banks
and Borrower, and Agent may be removed at any time with or without
cause by Majority Banks. If no successor Agent has been so appointed by
Majority Banks (and approved by Borrower) and has accepted such
appointment within 30 days after the retiring Agent's giving of notice
of resignation or
-40-
removal of the retiring Agent, then the retiring Agent may, on behalf
of Banks, appoint a successor Agent. Any successor Agent must be
approved by Borrower, which approval will not be unreasonably withheld.
Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights and duties of the retiring Agent, and
the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal hereunder
as Agent, the provisions of this Section 14 shall continue in effect
for its benefit in respect to any actions taken or omitted to be taken
by it while it was acting as Agent.
(f) Responsibility of Agent. It is expressly understood and
agreed that the obligations of Agent under the Loan Documents are only
those expressly set forth in the Loan Documents and that Agent, as the
case may be, shall be entitled to assume that no Default or Event of
Default has occurred and is continuing, unless Agent, as the case may
be, has actual knowledge of such fact or has received notice from a
Bank or Borrower that such Bank or Borrower consider that a Default or
an Event of Default has occurred and is continuing and specifying the
nature thereof. Neither Agent nor any of their directors, officers,
attorneys or employees shall be liable for any action taken or omitted
to be taken by them under or in connection with the Loan Documents,
except for its or their own gross negligence or willful misconduct.
Agent shall incur no liability under or in respect of any of the Loan
Documents by acting upon any notice, consent, certificate, warranty or
other paper or instrument believed by it to be genuine or authentic or
to be signed by the proper party or parties, or with respect to
anything which it may do or refrain from doing in the reasonable
exercise of its judgment, or which may seem to it to be necessary or
desirable.
Agent shall not be responsible to Banks for any of Borrower's
recitals, statements, representations or warranties contained in any of
the Loan Documents, or in any certificate or other document referred to
or provided for in, or received by any Bank under, the Loan Documents,
or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of or any of the Loan Documents or for any failure by
Borrower to perform any of its obligations hereunder or thereunder.
Agent may employ agents and attorneys-in-fact and shall not be
answerable, except as to money or securities received by it or its
authorized agents, for the negligence or misconduct of any such agents
or attorneys-in-fact selected by it with reasonable care.
The relationship between Agent and each Bank is only that of
agent and principal and has no fiduciary aspects. Nothing in the Loan
Documents or elsewhere shall be construed to impose on Agent any duties
or responsibilities other than those for which express provision is
therein made. In performing its duties and functions hereunder, Agent
does not assume and shall not be deemed to have assumed, and hereby
expressly disclaims, any obligation or responsibility toward or any
relationship of agency or trust
-41-
with or for Borrower or any of its beneficiaries or other creditors. As
to any matters not expressly provided for by the Loan Documents, Agent
shall not be required to exercise any discretion or take any action,
but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the
instructions of all Banks and such instructions shall be binding upon
all Banks and all holders of the Notes; provided, however, that Agent
shall not be required to take any action which is contrary to the Loan
Documents or applicable law.
(g) Independent Investigation. Each Bank severally represents
and warrants to Agent that it has made its own independent
investigation and assessment of the financial condition and affairs of
Borrower in connection with the making and continuation of its
participation hereunder and has not relied exclusively on any
information provided to such Bank by Agent in connection herewith, and
each Bank represents, warrants and undertakes to Agent that it shall
continue to make its own independent appraisal of the credit worthiness
of Borrower while the Notes are outstanding or its commitments
hereunder are in force. Agent shall not be required to keep itself
informed as to the performance or observance by Borrower of this
Agreement or any other document referred to or provided for herein or
to inspect the properties or books of Borrower. Other than as provided
in this Agreement, Agent shall not have any duty, responsibility or
liability to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of Borrower
which may come into the possession of Agent.
(h) Indemnification. Banks agree to indemnify Agent, ratably
according to their respective Revolving Commitments on a Pro Rata
basis, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any proper and reasonable kind or nature whatsoever
which may be imposed on, incurred by or asserted against Agent in any
way relating to or arising out of the Loan Documents or any action
taken or omitted by Agent under the Loan Documents, provided that no
Bank shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements resulting from Agent's gross negligence or willful
misconduct. Each Bank shall be entitled to be reimbursed by the Agent
for any amount such Bank paid to Agent under this Section 14(h) to the
extent the Agent has been reimbursed for such payments by Borrower or
any other Person. The parties intend for the provisions of this Section
to apply to and protect the Agent from the consequences of any
liability including strict liability imposed or threatened to be
imposed on Agent as well as from the consequences of its own
negligence, whether or not that negligence is the sole, contributing or
concurring cause of any such liability.
-42-
(i) Benefit of Section 14. The agreements contained in this
Section 14 are solely for the benefit of Agent and the Banks and are
not for the benefit of, or to be relied upon by, Borrower, any
affiliate of Borrower or any other person.
(j) Pro Rata Treatment. Subject to the provisions of this
Agreement, each payment (including each prepayment) by Borrower and
collection by Banks (including offsets) on account of the principal of
and interest on the Notes and fees provided for in this Agreement,
shall be made Pro Rata; provided, however, in the event that any
Defaulting Bank shall have failed to make an Advance as contemplated
under Section 3 hereof and Agent or another Bank or Banks shall have
made such Advance, payment received by Agent for the account of such
Defaulting Bank or Banks shall not be distributed to such Defaulting
Bank or Banks until such Advance or Advances shall have been repaid in
full to the Bank or Banks who funded such Advance or Advances.
(k) Assumption as to Payments. Except as specifically provided
herein, unless Agent shall have received notice from Borrower prior to
the date on which any payment is due to Banks hereunder that Borrower
will not make such payment in full, Agent may, but shall not be
required to, assume that Borrower has made such payment in full to
Agent on such date and Agent may, in reliance upon such assumption,
cause to be distributed to each Bank on such due date an amount equal
to the amount then due such Bank. If and to the extent Borrower shall
not have so made such payment in full to Agent, each Bank shall repay
to Agent forthwith on demand such amount distributed to such Bank
together with interest thereon, for each day from the date such amount
is distributed to such Bank until the date such Bank repays such amount
to Agent, at the interest rate applicable to such portion of the
Revolving Loans.
(l) Other Financings. Without limiting the rights to which any
Bank otherwise is or may become entitled, such Bank shall have no
interest, by virtue of this Agreement or the Loan Documents, in (a) any
present or future loans from, letters of credit issued by, or leasing
or other financial transactions by, any other Bank to, on behalf of, or
with Borrower (collectively referred to herein as "Other Financings")
other than the obligations hereunder; (b) any present or future
guarantees by or for the account of Borrower which are not contemplated
by the Loan Documents; (c) any present or future property taken as
security for any such Other Financings; or (d) any property now or
hereafter in the possession or control of any other Bank which may be
or become security for the obligations of Borrower arising under any
loan document by reason of the general description of indebtedness
secured or property contained in any other agreements, documents or
instruments relating to any such Other Financings.
(m) Interests of Banks. Nothing in this Agreement shall be
construed to create a partnership or joint venture between Banks
for any purpose. Agent, Banks and Borrower recognize that the
respective obligations of Banks under the Revolving
-43-
Commitments shall be several and not joint and that neither Agent, nor
any of Banks shall be responsible or liable to perform any of the
obligations of the other under this Agreement. Each Bank is deemed to
be the owner of an undivided interest in and to all rights, titles,
benefits and interests belonging and accruing to Agent under the
Security Instruments, including, without limitation, liens and security
interests in any collateral, fees and payments of principal and
interest by Borrower under the Revolving Commitments on a Pro Rata
basis. Each Bank shall perform all duties and obligations of Banks
under this Agreement in the same proportion as its ownership interest
in the Loans outstanding at the date of determination thereof.
(n) Investments. Whenever Agent in good faith determines that
it is uncertain about how to distribute to Banks any funds which it has
received, or whenever Agent in good faith determines that there is any
dispute among the Banks about how such funds should be distributed,
Agent may choose to defer distribution of the funds which are the
subject of such uncertainty or dispute. If Agent in good faith believes
that the uncertainty or dispute will not be promptly resolved, or if
Agent is otherwise required to invest funds pending distribution to the
Banks, Agent may invest such funds pending distribution (at the risk of
Borrower). All interest on any such investment shall be distributed
upon the distribution of such investment and in the same proportions
and to the same Persons as such investment. All monies received by
Agent for distribution to the Banks (other than to the Person who is
Agent in its separate capacity as a Bank) shall be held by the Agent
pending such distribution solely as Agent for such Banks, and Agent
shall have no equitable title to any portion thereof.
(o) Withholding Tax. Each Bank agrees to furnish (if it is
organized under the laws of any jurisdiction other than the United
States or any State thereof) to the Agent and the Borrower prior to the
time that the Borrower is required to make any payment of principal,
interest or fees hereunder, to such Bank, duplicate executed originals
of either U.S. Internal Revenue Service Form 4224 or U.S. Internal
Revenue Service Form 1001 (wherein such Bank claims entitlement to the
benefits of a tax treaty that provides for a complete exemption from
U.S. federal income withholding tax on all payments hereunder) and a
Form W-8 and agrees to provide new Forms 4224 or 1001 and Form W-8,
upon the expiration of any previously delivered from or comparable
statements in accordance with applicable U.S. law and regulations and
amendments thereto, and agrees to comply with all applicable U.S. laws
and regulations with regard to such withholding tax exemption.
15. Exercise of Rights. No failure to exercise, and no delay in
exercising, on the part of the Agent or the Banks, any right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right. The rights of the Agent and the Banks hereunder shall be in addition to
all other rights provided by law. No modification or waiver of any provision of
the Loan Documents,
-44-
including this Agreement, or the Note nor consent to departure therefrom, shall
be effective unless in writing, and no such consent or waiver shall extend
beyond the particular case and purpose involved. No notice or demand given in
any case shall constitute a waiver of the right to take other action in the
same, similar or other circumstances without such notice or demand.
16. Notices. Any notices or other communications required or permitted
to be given by this Agreement or any other documents and instruments referred to
herein must be given in writing either by facsimile transmission or personally
delivered or couriered or mailed by prepaid certified or registered mail to the
party to whom such notice or communication is directed at the address of such
party as follows: (a) BORROWER: XXXXXX OCEANICS PACIFIC LIMITED, Xxxxxx &
Calder, P.O. Box 309, Upland House, Xxxxxx Town, Grand Cayman, B.W.I, Facsimile
No. (000) 000-0000; Attention: Xxxxx Xxxxxx; copy to: XXXXXX OCEANICS, INC.,
00000 Xxxx Xxx Xxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, Facsimile No. (000) 000-0000,
Attention: Xx. Xxxxx X. Xxxxxxx, Senior Vice President and Secretary; (b) AGENT:
x/x XXXXX, XXXX XXX, XXXXX, N.A., 000 Xxxxxx, Xxxxxxx, Xxxxx 00000, Facsimile
No. (000) 000-0000, Attention: Xxxxxxxxx X. Xxxxx, Vice President and (c) any
Bank at its address shown on any addendum hereto. Any such notice or other
communication shall be deemed to have been given (whether actually received or
not) on the day it is personally delivered or delivered by facsimile as
aforesaid or, if mailed, on the third day after it is mailed as aforesaid. Any
party may change its address for purposes of this Agreement by giving notice of
such change to the other party pursuant to this Section 16.
17. Expenses. Borrower shall pay (i) all reasonable and necessary
out-of-pocket expenses of the Banks, including reasonable fees and disbursements
of special counsel for the Agent, in connection with the preparation of this
Agreement, the other Loan Documents, title and other due diligence and closing
of the transaction described in this Agreement, any waiver or consent hereunder
or any amendment hereof or any default or Event of Default or alleged default or
Event of Default hereunder, (ii) all reasonable and necessary out-of-pocket
expenses of the Agent, including reasonable fees and disbursements of special
counsel for the Agent in connection with the preparation of any participation
agreement for a participant or participants requested by Borrower or any
amendment thereof and (iii) if a default or an Event of Default occurs, all
reasonable and necessary out-of-pocket expenses incurred by the Banks, including
fees and disbursements of counsel, in connection with such default and Event of
Default and collection and other enforcement proceedings resulting therefrom.
Borrower shall indemnify the Banks against any transfer taxes, document taxes,
assessments or charges made by any governmental authority by reason of the
execution, delivery and filing of the Loan Documents.
18. Indemnity. Borrower agrees to indemnify and hold harmless the Banks
and their respective officers, employees, agents, attorneys and representatives
(singularly, an "Indemnified Party", and collectively, the "Indemnified
Parties") from and against any loss, cost, liability, damage or expense
(including the reasonable fees and out-of-pocket expenses of counsel to the
Banks, including all local counsel hired by such counsel) ("Claim") incurred by
the Banks in
-45-
investigating or preparing for, defending against, or providing evidence,
producing documents or taking any other action in respect of any commenced or
threatened litigation, administrative proceeding or investigation under any
federal securities law, federal or state environmental law, or any other statute
of any jurisdiction, or any regulation, or at common law or otherwise, which is
alleged to arise out of or is based upon any acts, practices or omissions or
alleged acts, practices or omissions of Borrower or its agents or arises in
connection with the duties, obligations or performance of the Indemnified
Parties in negotiating, preparing, executing, accepting, keeping, completing,
countersigning, issuing, selling, delivering, releasing, assigning, handling,
certifying, processing or receiving or taking any other action with respect to
the Loan Documents and all documents, items and materials contemplated thereby
even if any of the foregoing arises out of an Indemnified Party's ordinary
negligence. The indemnity set forth herein shall be in addition to any other
obligations or liabilities of Borrower to the Banks hereunder or at common law
or otherwise, and shall survive any termination of this Agreement, the
expiration of the Revolving Loans and the payment of all indebtedness of
Borrower to the Banks hereunder and under the Notes, provided that Borrower
shall have no obligation under this Section to the Bank with respect to any of
the foregoing arising out of the gross negligence or willful misconduct of any
Indemnified Party. If any Claim is asserted against any Indemnified Party, the
Indemnified Party shall endeavor to notify Borrower of such Claim (but failure
to do so shall not affect the indemnification herein made except to the extent
of the actual harm caused by such failure). The Indemnified Party shall have the
right to employ, at Borrower's expense, counsel of the Indemnified Parties'
choosing and to control the defense of the Claim. Borrower may at its own
expense also participate in the defense of any Claim. Each Indemnified Party may
employ separate counsel in connection with any Claim to the extent such
Indemnified Party believes it reasonably prudent to protect such Indemnified
Party. The parties intend for the provisions of this Section to apply to and
protect each Indemnified Party from the consequences of any liability including
strict liability imposed or threatened to be imposed on Agent as well as from
the consequences of its own ordinary negligence, whether or not that negligence
is the sole, contributing, or concurring cause of any Claim.
19. Governing Law. THIS AGREEMENT IS BEING EXECUTED AND DELIVERED, AND
IS INTENDED TO BE PERFORMED, IN HOUSTON, HARRIS, COUNTY, TEXAS, AND THE
SUBSTANTIVE LAWS OF TEXAS SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT
AND INTERPRETATION OF THIS AGREEMENT AND ALL OTHER DOCUMENTS AND INSTRUMENTS
REFERRED TO HEREIN, UNLESS OTHERWISE SPECIFIED THEREIN.
20. Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws effective
during the term of this Agreement, such provisions shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Agreement, and the
remaining provisions of the Agreement shall remain in full force and effect
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and shall not be affected by the illegal, invalid or unenforceable provision or
by its severance from this Agreement.
21. Maximum Interest Rate. Regardless of any provisions contained in
this Agreement or in any other documents and instruments referred to herein, the
Banks shall never be deemed to have contracted for or be entitled to receive,
collect or apply as interest on the Notes any amount in excess of the Maximum
Rate, and in the event any Bank ever receives, collects or applies as interest
any such excess, or if an acceleration of the maturities of any Notes or if any
prepayment by Borrower result in Borrower having paid any interest in excess of
the Maximum Rate, such amount which would be excessive interest shall be applied
to the reduction of the unpaid principal balance of the Notes for which such
excess was received, collected or applied, and, if the principal balance of such
Note is paid in full, any remaining excess shall forthwith be paid to Borrower.
All sums paid or agreed to be paid to the Banks for the use, forbearance or
detention of the indebtedness evidenced by the Notes and/or this Agreement
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such indebtedness until payment
in full so that the rate or amount of interest on account of such indebtedness
does not exceed the Maximum Rate. In determining whether or not the interest
paid or payable under any specific contingency exceeds the Maximum Rate of
interest permitted by law, Borrower and the Banks shall, to the maximum extent
permitted under applicable law, (i) characterize any non-principal payment as an
expense, fee or premium, rather than as interest; and (ii) exclude voluntary
prepayments and the effect thereof; and (iii) compare the total amount of
interest contracted for, charged or received with the total amount of interest
which could be contracted for, charged or received throughout the entire
contemplated term of the Notes at the Maximum Rate.
22. Amendments or Waivers. Neither this Agreement nor any other Loan
Document nor any terms hereof or thereof may be changed, waived or discharged or
terminated unless such change, waiver, discharge or termination is in writing
signed by the Borrower and the Majority Banks, provided that no such change,
waiver, discharge or termination shall, without the consent of each Bank (other
than a Defaulting Bank) affected thereby, (i) extend the Maturity Date (it being
understood that any waiver of the application of any prepayment of the Revolving
Loans or the method of application of any prepayment shall not constitute any
such extension), to reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any post-default
increase in interest rates) or fees thereon, or reduce the principal amount
thereof, (ii) increase the Revolving Commitment of any Bank over the amount
thereof then in effect (it being understood that a waiver of any condition,
covenant, Default or Event of Default shall not constitute a change in the terms
of any Revolving Commitment of any Bank), (iii) release or permit the release of
any Collateral from the Lien of the respective Security Instruments, (iv) amend,
modify or waive any provision of this Section 22, (v) reduce the percentage
specified in the definition of Majority banks (it being understood and agreed
that, with the consent of the Majority Banks, additional extensions of credit
pursuant to this Agreement may be included in the determination of Majority
Banks on substantially the same basis as the
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Revolving Commitments (and related extensions of credit) are included on the
Effective Date), (vi) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement or (vii) waive, change
the timing or amount of, or extend any mandatory reduction in the Revolving
Commitment including, without limitation, a Quarterly Commitment Reduction. No
provision of Section 2, or any other provisions relating to and issue of Letters
of Credit or the Administrative Agent may be modified without the consent of the
Administrative Agent.
23. Multiple Counterparts. This Agreement may be executed in a number
of identical separate counterparts, each of which for all purposes is to be
deemed an original, but all of which shall constitute, collectively, one
agreement. No party to this Agreement shall be bound hereby until a counterpart
of this Agreement has been executed by all parties hereto.
24. Conflict. In the event any term or provision hereof is
inconsistent with or conflicts with any provision of the Loan
Documents, the terms or provisions contained in this Agreement
shall be controlling.
25. Survival. All covenants, agreements, undertakings,
representations and warranties made in the Loan Documents,
including this Agreement, the Notes or other documents and
instruments referred to herein shall survive all closings
hereunder and shall not be affected by any investigation made by
any party.
26. Parties Bound. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors, assigns,
heirs, legal representatives and estates, provided, however, that Borrower may
not, without the prior written consent of the Banks, assign any rights, powers,
duties or obligations hereunder.
27. Assignments and Participations.
(a) Each Bank shall have the right to sell, assign or transfer
all or any part of its Note or Notes, its Revolving Commitments and its
rights and obligations hereunder to an Eligible Assignee; provided,
that with each sale, assignment or transfer (other than to an
Affiliate, a Bank or a Federal Reserve Bank), shall require the consent
of Borrower and Agent, which consents will not be unreasonably
withheld, and the assignee, transferee or recipient shall have, to the
extent of such sale, assignment, or transfer, the same rights, benefits
and obligations as it would if it were such Bank and a holder of such
Note, Revolving Commitment and rights and obligations, including,
without limitation, the right to vote on decisions requiring consent or
approval of all Banks or Majority Banks and the obligation to fund its
Revolving Commitment; provided, further, that (1) each such sale,
assignment, or transfer (other than to an Affiliate, a Bank or a
Federal Reserve Bank) shall be in an aggregate principal amount not
less than $5,000,000, (2) each remaining Bank shall at all times
maintain Revolving Commitments then outstanding in an aggregate
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principal amount at least equal to $1,000,000; (3) no Bank may offer to
sell its Note or Notes, Revolving Commitment, rights and obligations or
interests therein in violation of any securities laws; and (4) no such
assignments (other than to a Federal Reserve Bank) shall become
effective until the assigning Bank and its assignees delivers to Agent
and Borrower an Assignment and Acceptance and the Note or Notes subject
to such assignment and other documents evidencing any such assignment.
An assignment fee in the amount of $2,500 for each such assignment
(other than to an Affiliate, a Bank or the Federal Reserve Bank) will
be payable to Agent by assignor or assignee. Within five (5) Business
Days after its receipt of copies of the Assignment and Acceptance and
the other documents relating thereto and the Note or Notes, Borrower
shall execute and deliver to Agent (for delivery to the relevant
assignee) a new Note or Notes evidencing such assignee's assigned
Revolving Commitment, and within a reasonable time after delivery of
such new Note or Notes to Agent, Agent shall return the old or replaced
Note or Notes to Borrower, and if the assignor Bank has retained a
portion of its Revolving Commitment, a replacement Note in the
principal amount of the Revolving Commitment retained by the assignor
(except as provided in the last sentence of this paragraph (a) such
Note or Notes, to be in exchange for, but not in payment of, the Note
or Notes held by such Bank). On and after the effective date of an
assignment hereunder, the assignee shall for all purposes be a Bank,
party to this Agreement and any other Loan Document executed by the
Banks and shall have all the rights and obligations of a Bank under the
Loan Documents, to the same extent as if it were an original party
thereto, and no further consent or action by Borrower, Banks or the
Agent shall be required to release the transferor Bank with respect to
its Revolving Commitment assigned to such assignee and the transferor
Bank shall henceforth be so released.
(b) Each Bank shall have the right to grant participations in
all or any part of such Bank's Notes and Revolving Commitment hereunder
to one or more pension plans, investment funds, financial institutions
or other Persons, provided, that:
(i) each Bank granting a participation shall retain
the right to vote hereunder, and no participant shall be
entitled to vote hereunder on decisions requiring consent or
approval of Bank or Majority Banks (except as set forth in
(iii) below);
(ii) in the event any Bank grants a participation
hereunder, such Bank's obligations under the Loan Documents
shall remain unchanged, such Bank shall remain solely
responsible to the other parties hereto for the performance of
such obligations, such Bank shall remain the holder of any
such Note or Notes for all purposes under the Loan Documents,
and Agent, each Bank and Borrower shall be entitled to deal
with the Bank granting a participation in the same manner as
if no participation had been granted; and
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(iii) no participant shall ever have any right by
reason of its participation to exercise any of the rights of
Banks hereunder, except that any Bank may agree with any
participant that such Bank will not, without the consent of
such participant (which consent may not be unreasonably
withheld) consent to any amendment or waiver requiring
approval of all Banks.
(c) It is understood and agreed that any Bank may provide to
assignees and participants and prospective assignees and participants
financial information and reports and data concerning Borrower's
properties and operations which was provided to such Bank pursuant to
this Agreement.
(d) Upon the reasonable request of either Agent or Borrower,
each Bank will identify those to whom it has assigned or participated
any part of its Notes and Revolving Commitment, and provide the amounts
so assigned or participated.
28. Choice of Forum: Consent to Service of Process and
Jurisdiction. THE OBLIGATIONS OF BORROWER UNDER THE LOAN
DOCUMENTS ARE PERFORMABLE IN XXXXXX COUNTY, TEXAS. ANY SUIT,
ACTION OR PROCEEDING AGAINST THE BORROWER WITH RESPECT TO THE
LOAN DOCUMENTS OR ANY JUDGMENT ENTERED BY ANY COURT IN RESPECT
THEREOF, MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS,
COUNTY OF XXXXXX, OR IN THE UNITED STATES COURTS LOCATED IN
XXXXXX COUNTY, TEXAS AND THE BORROWER HEREBY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF ANY
SUCH SUIT, ACTION OR PROCEEDING. THE BORROWER HEREBY IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING
IN SAID COURT BY THE MAILING THEREOF BY BANK BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO THE Borrower, AS APPLICABLE,
AT THE ADDRESS FOR NOTICES AS PROVIDED IN SECTION 17. THE
BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT
BROUGHT IN THE COURTS LOCATED IN THE STATE OF TEXAS, COUNTY OF
XXXXXX, AND HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY
SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
29. Waiver of Jury Trial. THE BORROWER HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
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30. Other Agreements. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES 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.
31. Financial Terms. All accounting terms used in this
Agreement which are not specifically defined herein shall be
construed in accordance with GAAP.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
BORROWER:
XXXXXX OCEANICS PACIFIC LIMITED
a Cayman Islands company
By:/S/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Director
GUARANTORS:
XXXXXX OCEANICS, INC.,
a Texas corporation
By: /S/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Senior Vice President
XXXXXX DEEP SEAS, LTD.,
a Texas limited partnership
By: Xxxxxx Xxxxxx Co.,
its general partner
By: /S/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Vice President
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BANKS:
Revolving Commitment: BANK ONE, TEXAS, N.A.,
a national banking association
$5,000,000.00
By: /S/ Xxxxxxxxx X. Xxxxx
Xxxxxxxxx X. Xxxxx
Vice President
Address for Notices for
operational matters:
0000 Xxxx Xxxxxx XXX 0
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Notices for
credit matters:
000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxxxx X. Xxxxx
Telephone No. (000) 000-0000
Fax No.: (000) 000-0000
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Revolving Commitment: CHRISTIANIA BANK OG KREDITKASSE ASA,
NEW YORK BRANCH
$5,000,000.00
By: /S/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: First Vice President
By: /S/ Xxxxxx X. XxXxxxx, III
Name: Xxxxxx X. XxXxxxx, III
Title: Vice President
Address for Notices for
operational matters:
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Loan Administration
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Notices for
credit matters:
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Shipping/Offshore/Aviation
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
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Revolving Commitment: THE BANK OF TOKYO-MITSUBISHI, LTD.
$2,000,000.00
By: /S/ Xxxx X. XxXxxx
Name: Xxxx X. XxXxxx
Title: Vice President & Manager
Address for Notices for
operational matters:
Bank of Toyko-Mitsubishi
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: Loan Administration
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Notices for
credit matters:
Bank of Toyko-Mitsubishi
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: Manager-Corporate Finance
Telephone No. (000) 000-0000
Fax No.: (000) 000-0000
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Revolving Commitment: CREDIT AGRICOLE INDOSUEZ
$4,000,000.00
By: /S/ Xxxxxx X. de Fontenay
Xxxxxx X. de Fontenay
Assistant Vice President
Address for Notices for
operational matters:
Credit Agricole Indosuez
00, Xxx xx Xxxxxxx, 00000 Xxxxx
Xxxxxx
Attention: Xxxxxx Xxxxx-Xxxxxx
Telephone No.: 00-0-00-00-00-00
Fax No.: 00-0-00-00-00-00
Address for Notices for
credit matters:
Credit Agricole Indosuez
Xxxxxxxxxxxxxx Xxxxxx Xxxxxx
X.X. Xxx 0000
0000 Xxxx Xxxxxx
Attention: Xxxx-Xxxxxx Xxxxxxx
Telephone No. 00-00-00-00-00
Fax No.: 00-00-00-00-00
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Revolving Commitment: CREDIT LYONNAIS, NEW YORK BRANCH
$2,000,000.00
By:/S/ Xxxxxxx-Xxxx Xxxxxxx
Xxxxxxx-Xxxx Xxxxxxx
Senior Vice President
Address for Notices for
operational matters:
Credit Lyonnais
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention:
Telephone No.: (713)
Fax No.: (000) 000-0000
Address for Notices for
credit matters:
Credit Lyonnais
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention:
Telephone No. (713)
Fax No.: (000) 000-0000
-56-
Revolving Commitment: THE FUJI BANK, LIMITED,
HOUSTON AGENCY
$3,000,000.00
By:/S/ Xxxxxxx Xxxxxx
Name: Xxxxxxx Xxxxxx
Title: Vice President & Manager
Address for Notices for
operational matters:
The Fuji Bank, Limited
0000 XxXxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxx
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Notices for
credit matters:
The Fuji Bank, Limited
0000 XxXxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone No. (000) 000-0000
Fax No.: (000) 000-0000
-57-
Revolving Commitment: MEESPIERSON N.V.
$4,000,000.00
By: /S/ Xxxxx Xxxxxx
Xxxxx Xxxxxx
Vice President
Address for Operational Notices:
MeesPierson N.V.
Loan Administration
Xxxxxxxxxx 00
X.X. Xxx 000
0000 XX Xxxxxxxxx
Xxx Xxxxxxxxxxx
Primary: Xxx xx Xxxx
MeesPierson-Rotterdam Office
Telephone No.: (000) 00 00 000 0000
Fax No.: (000) 00 00 000 0000
with copy to: MeesPierson N.V.
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Secondary: Xxxxxxx Xxxxxxx
MeesPierson-Dallas Office
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Other Notices:
MeesPierson N.V.
Xxxxxxxxxx 00
0000 XX Xxxxxxxxx
Xxx Xxxxxxxxxxx
Attn: Xxxxxx van der Klaauw
Telephone: (000) 00 00 000 0000
Fax No.: (000) 00 00 000 0000
copy to: MeesPierson N.V.
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Fax No.: (000) 000-0000
Payment Instructions:
ABN AMRO NEW YORK
ABA #000000000
For credit to: MeesPierson N.V. Amsterdam
Acct #: 63 70 70 34 27 40
Reference: for further credit to
Loan Administration
Attention: Xxx xx Xxxx-Xxxxxx Oceanics, Inc.
-58-
AGENT:
BANK ONE, TEXAS, N.A.
a national banking association
By: /S/ Xxxxxxxxx X. Xxxxx
Xxxxxxxxx X. Xxxxx
Vice President
-59-
CO-AGENT:
CHRISTIANIA BANK OG KREDITKASSE ASA,
NEW YORK BRANCH
By: /S/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: First Vice President
By: /S/ Xxxxxx X. XxXxxxx, III
Name: Xxxxxx X. XxXxxxx, III
Title:Vice President
0230355.06\02
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