Item 1.01. Entry into a Material Definitive Agreement.
On June 20, 2019, Vantage Deepwater Company (“VDEEP”) and Vantage Deepwater Drilling, Inc. (“VDDI”), both wholly-owned subsidiaries of Vantage Drilling International (the “Company”), entered into an agreement (the “Agreement”) with Petroleo Brasileiro S.A. (“Petrobras”) and its subsidiaries Petrobras America, Inc. (“PAI”) and Petrobras Venezuela Investments & Services, BV (“PVIS” and, together with Petrobras and PAI, the “Petrobras Parties”), relating to the arbitration award (the “Award”) issued in favor of VDEEP and VDDI in connection with their wrongful termination claims against PAI and PVIS in respect of the Agreement for the Provision of Drilling Services for the Titanium Explorer dated February 4, 2009, between PVIS and VDEEP and which had been novated to PAI and VDDI.
Pursuant to the Agreement, PVIS agreed to pay VDEEP $690,810,875.21 and PAI agreed to pay VDDI $10,128,564.79 (collectively, the “Payments”), in full satisfaction and payment of the Award and the related judgment entered by the United States District Court in the Southern District of Texas confirming the Award. Neither party released any of its claims, except for certain claims in respect of certainpre-judgement attachments made by VDEEP and VDDI on certain assets of PVIS and Petrobras in the Netherlands. VDEEP and VDDI received the Payments on June 21, 2019.
The description set forth above is qualified in its entirety by the full text of the Agreement, attached as Exhibit 10.1 hereto.
In light of the retention by the Petrobras Parties of their rights, including the right to appeal the U.S. judgment, the Petrobras Parties may assert a claim for the return of all or a portion of the Payments made to satisfy the Award in the event the U.S. judgment is overturned on appeal. The Company can provide no assurances as to the ultimate outcome of any such appeals. In addition, the Payments received by VDEEP and VDDI will be subject to reductions due to currently owed and future legal fees (including, among others, a contingency fee equal to 10% of the Payments) and any applicable taxes. Accordingly, no assurances can be given as to the amount of the Payments to be ultimately realized by the Company.
The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions, including the Company’s ability prevail in the defense of any appeal by Petrobras due to legal, procedural and other risks associated with enforcing arbitration awards in these circumstances or as disclosed from time to time in the Company’s filings with the Securities and Exchange Commission. Moreover, any final recovery may be taxable and will be subject to reduction for legal expenses. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements. The Company disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.
Item 9.01. Financial Statements and Exhibits.
