EXHIBIT 4.6
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (the "Amendment"), dated as of
December 21, 1998, is by and among PETROLEUM SUPPLY COMPANY, PRIDE INTERNATIONAL
HOLDINGS, INC., RANGER WELL SERVICE, INC., PRIDE OFFSHORE, INC., and RANGER
CORPORATION (each individually, a "BORROWER," and, collectively, the
"BORROWERS"), PRIDE INTERNATIONAL, INC., (the "PARENT GUARANTOR"), each of the
Lenders (as defined in the below-mentioned Credit Agreement) signatory hereto,
BANK ONE, LOUISIANA, N.A. (formerly known as FIRST NATIONAL BANK OF COMMERCE),
as arranger and syndication agent for the Lenders (in such capacity, together
with its successors in such capacity, the "SYNDICATION AGENT"), and XXXXX FARGO
BANK (TEXAS), NATIONAL ASSOCIATION, as administrative and documentation agent
for the Lenders (in such capacity, together with its successors in such
capacity, the "ADMINISTRATIVE AGENT") and as issuer of Letters of Credit.
R E C I T A L S:
WHEREAS, the Borrowers, the Parent Guarantor, the Agents, and the Lenders
signatory hereto entered into a Credit Agreement, dated as of December 22, 1997
(as amended as of April 24, 1998 and September 17, 1998, the "CREDIT
AGREEMENT"), pursuant to which the Lenders made available to the Borrowers a
revolving credit facility;
WHEREAS, the Borrowers have requested that the Lenders and the Agents
agree to amend the Credit Agreement to amend the definition of Funded Debt and
to permit the incurrence of (i) certain Debt in connection with the
construction, equipping and mobilization of the PRIDE ANGOLA ultra-deepwater
drillship; (ii) Guarantees; (iii) Sale-Leaseback Debt relating to the PRIDE
TEXAS and PRIDE KANSAS; and (iv) certain Sale-Leaseback Debt relating to the
AMETHYST 1;
WHEREAS, to induce the Agents and the Required Lenders to enter into this
Amendment, the Borrowers have agreed to pay an amendment fee to those Lenders
executing this Amendment by 5:00 p.m. Houston, Texas time on December 21, 1998
and to modify certain definitions and covenants found in the Credit Agreement;
WHEREAS, the Required Lenders and the Agents are willing to amend the
Credit Agreement as hereinafter provided; and
WHEREAS, the Borrowers, the Parent Guarantor, the Lenders and the Agents
now desire to amend the Credit Agreement as herein set forth.
NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable considerations, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 1
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Capitalized terms used in this Amendment, to the
extent not otherwise defined herein, shall have the same meaning as in the
Credit Agreement, as amended hereby.
ARTICLE II
AMENDMENTS
Section 2.1 ADDITIONAL DEFINITIONS. Section 1.1 is amended by adding the
following definitions in alphabetical order:
"AMETHYST 1 LEASE" means Sale-Leaseback Debt of the Parent Guarantor
or one of the Subsidiaries approved by the Administrative Agent that is
incurred by March 31, 1999, not to exceed $100,000,000 in aggregate
principal amount, for a term of at least 13.5 years with an early buyout
option at eight and one half years (the indicative all-inclusive implicit
interest rate quoted to the Parent Guarantor is 9.25% per annum), copies
of which AMETHYST 1 Lease and related documents will be delivered to the
Administrative Agent and its counsel for approval before execution.
"CIC LOAN" means Limited Recourse Debt, not to exceed $205,000,000
in aggregate principal amount, to be issued in the future that will be
used to repay the PRIDE ANGOLA Construction Loan.
"MITSUBISHI GUARANTEES" means the guarantees (described on Schedule
1.1) issued by the Parent Guarantor in connection with the financing of
Amethyst Financial Corporation, a foreign affiliate of the Parent
Guarantor, pursuant to the Mitsubishi Loan Documents.
"MITSUBISHI LOAN DOCUMENTS" means the (i) Loan Agreement dated
December 19, 1998 among Petrodrill Six Limited, Mitsubishi Corporation
(UK) PLC as Facility Agent and Security Agent (the "Petrodrill Agents")
and the lenders party thereto and (ii) the Loan Agreement dated December
19, 1998 among Petrodrill Seven Limited, the Petrodrill Agents and the
lenders party thereto, and related documents, copies of which Loan
Agreements and related documents have been delivered to the Administrative
Agent and its counsel.
"PRIDE ANGOLA CONSTRUCTION LOAN" means the Debt, not to exceed
$205,000,000 in aggregate principal amount, incurred or to be incurred by
the Parent Guarantor, pursuant to the PRIDE ANGOLA Loan Documents, the
purpose of which PRIDE ANGOLA Construction Loan is to provide financing to
construct, equip and mobilize the ultra-deepwater drillship PRIDE ANGOLA
before delivery.
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 2
"PRIDE ANGOLA LOAN DOCUMENTS" means the Loan Agreement among
Compagnie Financiere de CIC et de l'Union Europeene, as Arranger, Facility
Agent and Security Trustee and the banks and financial institutions that
are "lenders" thereunder and related documents on terms similar to those
contained in the PRIDE AFRICA Loan Documents, copies of which Loan
Agreement and related documents have been delivered to the Administrative
Agent and its counsel.
"TEXAS/KANSAS LEASES" means Sale-Leaseback Debt of the Parent
Guarantor or one of its Subsidiaries approved by the Administrative Agent
that is incurred by March 31, 1999, not to exceed $80,000,000, with a
seven year term in the transaction arranged by BTM Capital, copies of
which Texas/Kansas Leases and related documents will be delivered to the
Administrative Agent and its counsel for approval before execution.
"WORKING" means that a Rig has operated under a drilling contract no
less than 15 days of the 30 days prior to the date of the most recently
delivered Borrowing Base Report upon fair and reasonable terms including
day rate no less favorable than could be obtained in an arm's length
transaction.
Section 2.2 DEFINITIONAL AMENDMENTS. Section 1.1 is further amended by:
(a) amending the definition of "Applicable Margin" as follows:
(i) by adding the following sentence at the end thereof:
"Until the Quarterly Payment Date first occurring after Debt
evidenced by the PRIDE AFRICA OFE Loan and the PRIDE ANGOLA
Construction Loan have been repaid in full with proceeds of Limited
Recourse Debt and satisfactory proof of such repayment is received
by the Administrative Agent, each Applicable Margin found in the
above table shall be increased by 0.50% and such increase shall
apply to all Advances until the Quarterly Payment Date first
mentioned in this Sentence;" and
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 3
deleting the existing table therefrom and inserting the following table in
lieu thereof:
S&P/XXXXX'X
RATING OF PARENT
RATIO OF GUARANTOR'S APPLICABLE MARGIN APPLICABLE MARGIN
FUNDED DEBT TO UNSECURED FOR EURODOLLAR FOR BASE
EBITDA SENIOR DEBT ADVANCES RATE ADVANCES
--------------------------------------------------------------------------------------
Less than 1.50 to 1.00 BBB-/Baa3 or higher 1.50% 0.75%
Greater than or equal to 50 to BB to BB+/ 1.75% 0.75%
1.00, but less than 2.00 1.00 Ba1 to Ba2
Greater than or equal to 2.00 to BB-/Ba3 2.00% 0.75%
1.00, but less than 2.50 to 1.00
Greater than or equal to 2.50 to B+/B1 2.25% 0.75%
1.00
======================================================================================
(b) deleting the definition of "Applicable Rig Advance Rate" and
replacing it with the following:
"'Applicable Rig Advance Rate' means 50 percent;"
(c) amending the definition of "Borrowing Base" by adding the
following words after the word "Rigs" in the last line thereof: "that are
Working";
(d) amending the definition of "Coverage Ratio" by:
(i) deleting the reference to "EBIT" and inserting in lieu
thereof a reference to "EBITDA"; and
(ii) adding to clause (b) after the word "expense" found on
the third line the following parenthetical: "(excluding, however,
non-cash interest expense attributable to the Zero Coupon
Debentures)";
(e) by deleting from the definition of "Eligible Rigs" the reference
to "Section 10.2" and inserting in lieu thereof a reference to "Section
10.2(c), (d), (e) or (f)";
(f) deleting from the definition in clause (a) of "Funded Debt" the
words "the PRIDE AFRICA OFE Loan";
(g) by amending the definition of "Rigs" by inserting the following
in the first line thereof after the word "hereto:"
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 4
"and all other drilling units in which Lien is granted by the
Administrative Agent for the PRO RATa benefit of the Lenders
pursuant to Loan Documents satisfactory to the Administrative
Agent;"
Section 2.3 AMENDMENT TO SECTION 10.1. Section 10.1 is amended by:
(a) deleting from clause (e) the reference to "$120,000,000" and
inserting in lieu thereof a reference to $40,000,000;"
(b) adding the following at the end of clause (f): "PLUS the PRIDE
ANGOLA Construction Loan;"
(c) adding the following at the end of clause (g): "PLUS the
AMEYTHST 1 Lease, the CIC Loan (once the Administrative Agent finds, in
writing, that the terms thereof are acceptable and the CIC Loan
constitutes Limited Recourse Debt) and the Texas/Kansas Leases;" and
(d) adding the following at the end of clause (h): "PLUS the
"Mitsubishi Guarantees."
Section 2.4 AMENDMENT TO SECTION 2.8. Section 2.8 is amended by deleting
the reference to "0.375%" and inserting in lieu thereof a reference to "0.625%."
Section 2.5 AMENDMENT TO SECTION 11.1. Section 11.1 is amended by deleting
therefrom clauses (a) and (b) and substituting the following in lieu thereof:
"the following:
ROLLING PERIOD ENDING REQUIRED RATIO
3/31/99 4.25x to 1.0
6/30/99 4.50x to 1.0
9/30/99 4.75x to 1.0
12/31/99 4.75x to 1.0
3/31/00 3.75x to 1.0
6/30/00 3.50x to 1.0
and thereafter 3.50x to 1.0"
Section 2.6 AMENDMENT TO SECTION 11.2. Section 11.2 is amended by deleting
therefrom clauses (a), (b) and (c) and substituting the following therefor:
"(a) 0.60 for each determination made during the period to and
including December 31, 1999 and (b) 0.50 for each quarter ending
after December 31, 1999."
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 5
Section 2.7 AMENDMENT TO SECTION 11.3. Section 11.3 is amended by deleting
therefrom the references to "1.35" and "1.50" and inserting in lieu thereof a
reference to "2.0".
Section 2.8 AMENDMENTS TO SECTION 12.1. Section 12.1 is amended by thereto
two new clauses, reading as follows:
"(p) failure of the Parent Guarantor to comply with the Guarantees.
"(q) the PRIDE ANGOLA Construction Loan shall not be repaid with
proceeds of the CIC Loan or the Parent Guarantor released from all
liability thereunder by March 31, 2000.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 NECESSARY DOCUMENTATION. This Amendment shall be effective
when the Administrative Agent shall have received this Amendment executed by the
Borrowers, the Agent, the Parent Guarantor and the Required Lenders. The Parent
Guarantor shall have paid to the Administrative Agent an amendment fee equal to
0.50% times the Commitments to be shared PRO RATA by the Lenders executing this
Amendment by 5:00 p.m. on December 21, 1998. The Administrative Agent, upon
receipt of the amendment fees, shall promptly distribute the PRO RATA shares of
the Amendment fee to the Lenders entitled thereto.
Section 3.2 REPRESENTATIONS AND WARRANTIES. All representations and
warranties contained in the Credit Agreement shall be true and correct in all
material respects on and as of the date hereof with the same force and effect as
if such representations and warranties had been made on and as of such date.
ARTICLE IV
MISCELLANEOUS
Section 4.1 RATIFICATIONS, REPRESENTATIONS AND WARRANTIES. Except as
expressly modified and superseded by this Amendment, the terms and provisions of
the Credit Agreement and the other Loan Documents are ratified and confirmed and
shall continue in full force and effect. The representations and warranties
contained herein and in all other Loan Documents, as amended hereby, shall be
true and correct in all material respects as of, and as if made on, the date
hereof. The Borrower, the Banks and the Agents agree that the Credit Agreement
as amended hereby shall continue to be legal, valid, binding and enforceable in
accordance with its terms, except as the enforceability thereof may be affected
by general principles of equity or creditors' rights.
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 6
Section 4.2 SPECIAL REPRESENTATION. Each of the Parent Guarantor and each
Borrower represents and warrants to the Agents and the Lenders that (a) the
recourse of the holders of the CIC Loan (after the period of the PRIDE ANGOLA
Construction Loan) is effectively limited to the Foreign Affiliate that is the
obligor thereunder and to the security of the assets of such Foreign Affiliate
and (b) the maximum exposure reasonably expected under the Mitsubishi Guarantees
is $74,200,000.
Section 4.3 ADDITIONAL COVENANT. Each of the Parent Guarantor and each
Borrower agrees (a) during the term of the Agreement, to continue to cause all
Eligible Accounts that are Domestic Accounts to be directed to a Parent
Guarantor or a Borrower bank account maintained at the Syndication Agent; (b) to
pledge as Collateral at least three Eligible Rigs that are Working no later than
the delivery date of the January 31, 1999 Borrowing Base Report; (c) during the
term of the Agreement, upon the request of the Administrative Agent, to cause
all Eligible Accounts that are Foreign Accounts to be directed to a Parent
Guarantor or a Borrower bank account maintained at the Administrative Agent; and
(d) to permit, at the expense of the Parent Guarantor and the Borrowers, an
examination, no later than January 31, 1999, of Eligible Accounts by the
Administrative Agent or a third-party selected by the Administrative Agent.
Section 4.4 REFERENCE TO THE CREDIT AGREEMENT. Each of the Loan Documents,
including the Credit Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Credit Agreement as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Credit Agreement
shall mean a reference to the Credit Agreement as amended hereby.
Section 4.5 SEVERABILITY. Any provisions of this Amendment held by court
of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provisions so held to be invalid or unenforceable.
Section 4.6 APPLICABLE LAW. This Amendment and all other Loan Documents
executed pursuant hereto shall be governed by and construed in accordance with
the laws of the State of Texas and the applicable laws of the United States of
America.
Section 4.7 SUCCESSORS AND ASSIGNS. This Amendment is binding upon and
shall inure to the benefit of the Lenders, the Agents, the Parent Guarantor and
the Borrowers and their respective successors and assigns.
Section 4.8 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
but all of which when taken together shall constitute one and the same
instrument. Facsimile signatures shall be effective for all purposes.
Section 4.9 HEADINGS. The headings, captions, and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 7
Section 4.10 NO ORAL AGREEMENTS. THIS AMENDMENT AND ALL OTHER INSTRUMENTS,
DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES, AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Section 4.11 DETERMINATION OF CERTAIN DEBT AS LIMITED RECOURSE DEBT. The
Administrative Agent hereby designates the CIC Loan (effective after repayment
of the PRIDE ANGOLA Construction Loan or release of the Parent Guarantor from
all liability thereunder) as Limited Recourse Debt for purposes of the Credit
Agreement.
[Balance of this page intentionally left blank.]
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 8
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
BORROWERS:
PETROLEUM SUPPLY COMPANY
By:/s/XXXX X. XXXXXX
_______________________________
Name:Xxxx X. XxXxxx
Title:
PRIDE INTERNATIONAL HOLDINGS, INC.
By:/s/XXXX X. XXXXXX
________________________________
Name:Xxxx X. XxXxxx
Title:
RANGER WELL SERVICE, INC.
By:/s/XXXX X. XXXXXX
________________________________
Name:Xxxx X. XxXxxx
Title:
PRIDE OFFSHORE, INC.
By:/s/XXXX X. XXXXXX
________________________________
Name:Xxxx X. XxXxxx
Title:
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 9
RANGER CORPORATION
By:/s/XXXX X. XXXXXX
________________________________
Name:Xxxx X. XxXxxx
Title:
PARENT GUARANTOR:
PRIDE INTERNATIONAL, INC.
By:/s/XXXX X. XXXXXX
________________________________
Xxxx X. XxXxxx
Vice President
AGENTS AND LENDERS:
XXXXX FARGO BANK (TEXAS),
NATIONAL ASSOCIATION, as Administrative
Agent and a Lender
By:/s/X. XXXXXXXXX
________________________________
Xxxxx X. Xxxxxxxxx
Vice President
BANK ONE, LOUISIANA, N.A.
as Syndication Agent and as a Lender
By:/S/ J. XXXXXXX LE DOUX
________________________________
Name: J. Xxxxxxx Le Doux
Title:Vice President
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 10
HIBERNIA NATIONAL BANK
By:/s/ X.XXXX
________________________________
Name:X. Xxxx
Title:Senior Vice President
THE FUJI BANK, LIMITED -HOUSTON
AGENCY
By:/s/ XXXXXXX XXXXXXX
________________________________
Name:Xxxxxxx Xxxxxxx
Title:Vice President and Manager
per pro XXXXX BROTHERS XXXXXXXX & CO.
By:/s/ XXXXXXX X. XXXXXX
________________________________
Name:Xxxxxxx X. Xxxxxx
Title:Senior Manager
THIRD AMENDMENT TO CREDIT AGREEMENT - PAGE 11
