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EXHIBIT 10.31
$100,000,000
11% Series A Senior Notes Due 2005
of Bayard Drilling Technologies, Inc.
PURCHASE AGREEMENT
JUNE 19, 1998
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
LEHMAN BROTHERS INC.
BT ALEX. BROWN
DAIN RAUSCHER WESSELS
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$100,000,000
11% Series A Senior Notes Due 2005
of Bayard Drilling Technologies, Inc.
PURCHASE AGREEMENT
JUNE 19, 1998
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
LEHMAN BROTHERS INC.
BT ALEX. BROWN
DAIN RAUSCHER WESSELS
c/o Donaldson, Lufkin & Jenrette Securities Corporation
277 Park Avenue
New York, New York 10172
Dear Sirs:
Bayard Drilling Technologies, Inc., a Delaware corporation (the
"COMPANY"), proposes to issue and sell to Donaldson, Lufkin & Jenrette
Securities Corporation ("DLJ"), Lehman Brothers Inc., BT Alex. Brown and Dain
Rauscher Wessels (each, an "INITIAL PURCHASER" and collectively, the "INITIAL
PURCHASERS") an aggregate of $100,000,000 in principal amount of its 11% Series
A Senior Notes Due 2005 (the "SERIES A NOTES"), subject to the terms and
conditions set forth herein. The Series A Notes are to be issued pursuant to the
provisions of an indenture (the "INDENTURE"), dated as of June 26, 1998, among
the Company, the Guarantors (as defined below) and U.S. Trust Company of Texas,
N.A., as trustee (the "TRUSTEE"). The Series A Notes and the Series B Notes (as
defined below) issuable in exchange therefor are collectively referred to herein
as the "NOTES." The Notes will be guaranteed (the "GUARANTEES") by each of the
entities listed on Schedule A hereto (each, a "GUARANTOR" and collectively, the
"GUARANTORS"). Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Indenture.
1. OFFERING MEMORANDUM. The Series A Notes will be offered and sold to
the Initial Purchasers pursuant to one or more exemptions from the registration
requirements under the Securities Act of 1933, as amended (the "SECURITIES
ACT"). The Company and the Guarantors have prepared a preliminary offering
memorandum, dated June 5, 1998 (the "PRELIMINARY OFFERING
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MEMORANDUM") and a final offering memorandum, dated June 19, 1998 (the "OFFERING
MEMORANDUM"), relating to the Series A Notes and the Guarantees.
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Indenture, the Series A Notes shall bear the
following legend:
"THIS NOTE (OR ITS PREDECESSOR) AND ANY GUARANTEE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR I THE ACCOUNT
OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE SECOND SENTENCE
HEREOF. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE
HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (a "QIB"), OR (ii) IT
IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS NOTE
EXCEPT (i) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (ii) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (iii) IN AN OFFSHORE TRANSACTION MEETING
THE REQUIREMENTS OF RULE 903 OR 904 OF THE SECURITIES ACT, (D) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES
ACT, (iv) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY) OR (v) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
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AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION
OF THE FOREGOING."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained herein, the Company agrees to
issue and sell to the Initial Purchasers, and each Initial Purchaser agrees
severally and not jointly, to purchase from the Company the principal amounts of
Series A Notes set forth opposite the name of such Initial Purchaser on Schedule
B hereto at a purchase price equal to 97.25% of the principal amount thereof
(the "PURCHASE PRICE").
3. TERMS OF OFFERING. The Initial Purchasers have advised the
Company that the Initial Purchasers will make offers (the "EXEMPT RESALES") of
the Series A Notes purchased hereunder on the terms set forth in the Offering
Memorandum, as amended or supplemented, solely (i) to persons whom the Initial
Purchasers reasonably believe to be "qualified institutional buyers" as defined
in Rule 144A under the Securities Act ("QIBS") and (ii) persons permitted to
purchase the Series A Notes in offshore transactions in reliance upon Regulation
S under the Securities Act (each, a "REGULATION S PURCHASER") (such persons
specified in clauses (i) and (ii) being referred to herein as the "ELIGIBLE
PURCHASERS"). The Initial Purchasers will offer the Series A Notes to Eligible
Purchasers initially at a price equal to 100% of the principal amount thereof.
Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Series A Notes
will have the registration rights set forth in the registration rights agreement
(the "REGISTRATION RIGHTS AGREEMENT"), to be dated the Closing Date, in
substantially the form of Exhibit A hereto, for so long as such Series A Notes
constitute "TRANSFER RESTRICTED SECURITIES" (as defined in the Registration
Rights Agreement). Pursuant to the Registration Rights Agreement, the Company
and the Guarantors will agree to file with the Securities and Exchange
Commission (the "COMMISSION") under the circumstances set forth therein, (i) a
registration statement under the Securities Act (the "EXCHANGE OFFER
REGISTRATION STATEMENT") relating to the Company's 11% Series B Senior Notes Due
2005 (the "SERIES B NOTES"), to be offered in exchange for the Series A Notes
(such offer to exchange being referred to as the "EXCHANGE OFFER") and the
Guarantees thereof and (ii) a shelf registration statement pursuant to Rule 415
under the Securities Act (the "SHELF REGISTRATION STATEMENT" and, together with
the Exchange Offer Registration Statement, the "REGISTRATION STATEMENTS")
relating to the resale by certain holders of the Series A Notes and to use their
reasonable efforts to cause such Registration Statements to be declared and
remain effective and usable for the periods specified in the Registration Rights
Agreement and to consummate the Exchange Offer. This Agreement, the Indenture,
the Notes, the Guarantees and the Registration Rights Agreement are hereinafter
sometimes referred to collectively as the "OPERATIVE DOCUMENTS."
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4. DELIVERY AND PAYMENT.
(a) DeliveRy of, and payment of the Purchase Price for, the
Series A Notes shall be made at the offices of Baker & Botts, L.L.P., 1 Shell
Plaza, 910 Louisiana, Houston, Texas 77002, or such other location as may be
mutually acceptable. Such delivery and payment shall be made at 9:00 a.m., New
York City time, on June 26, 1998, or at such other time on the same date or such
other date as shall be agreed upon by the Initial Purchasers and the Company.
The time and date of such delivery and the payment for the Series A Notes are
herein called the "CLOSING DATE."
(b) One or more of the Series A Notes in definitive global form,
registered in the name of Cede & Co., as nominee of The Depository Trust Company
("DTC"), having an aggregate principal amount corresponding to the aggregate
principal amount of the Series A Notes (collectively, the "GLOBAL NOTE"), shall
be delivered by the Company to the Initial Purchasers (or as the Initial
Purchasers direct) in each case with any transfer taxes thereon duly paid by the
Company against payment by the Initial Purchasers of the Purchase Price therefor
by wire transfer in same day funds to the order of the Company. The Global Note
shall be made available to the Initial Purchasers for inspection not later than
9:30 a.m., New York City time, on the business day immediately preceding the
Closing Date.
5 AGREEMENTS OF THE COMPANY AND THE GUARANTORS. Each of the
Company and the Guarantors hereby agrees with the Initial Purchasers as follows:
(a) To advise the Initial Purchasers promptly and, if requested
by the Initial Purchasers, confirm such advice in writing, (i) of the issuance
by any state securities commission of any stop order suspending the
qualification or exemption from qualification of any Series A Notes for offering
or sale in any jurisdiction designated by the Initial Purchasers pursuant to
Section 5(e) hereof, or the initiation of any proceeding for such purposes and
(ii) of the happening of any event during the period referred to in Section 5(c)
below which makes any statement of a material fact made in the Preliminary
Offering Memorandum or the Offering Memorandum untrue or that requires any
additions to or changes in the Preliminary Offering Memorandum or the Offering
Memorandum in order to make the statements therein not misleading. If at any
time any state securities commission or other federal or state regulatory
authority shall issue an order suspending the qualification or exemption of any
Series A Notes under any state securities or Blue Sky laws, the Company and the
Guarantors will use their reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time.
(b) To furnish the Initial Purchasers and those persons
identified by the Initial Purchasers to the Company as many copies of the
Preliminary Offering Memorandum and the Offering Memorandum, and any amendments
or supplements thereto, as the Initial Purchasers may reasonably request for the
time period specified in Section 5(c). Subject to the Initial Purchasers'
compliance with their representations and warranties and agreements set forth in
Section 7 hereof, the Company consents to the use of the Preliminary Offering
Memorandum and the Offering
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Memorandum, and any amendments and supplements thereto required pursuant hereto,
by the Initial Purchasers in connection with Exempt Resales.
(c) During such period as in the opinion of counsel for the
Initial Purchasers an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchasers and in connection with
market-making activities of the Initial Purchasers for so long as any Series A
Notes are outstanding, (i) not to make any amendment or supplement to the
Offering Memorandum of which the Initial Purchasers shall not previously have
been advised or to which the Initial Purchasers shall reasonably object after
being so advised unless the Company shall have determined based on the advice of
counsel that such amendment or supplement is required by law; and (ii) to
prepare promptly upon the Initial Purchasers' reasonable request, any amendment
or supplement to the Offering Memorandum which in the opinion of counsel for the
Initial Purchasers is necessary in connection with such Exempt Resales or such
market-making activities.
(d) If during the period referred to in Section 5(c) above any
event shall occur or condition shall exist as a result of which, in the opinion
of counsel for the Initial Purchasers, it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements therein, in
the light of the circumstances when such Offering Memorandum is delivered to an
Eligible Purchaser, not misleading, or if, in the opinion of counsel for the
Initial Purchasers, it is necessary to amend or supplement the Offering
Memorandum to comply with any applicable law, forthwith to prepare an
appropriate amendment or supplement to such Offering Memorandum so that the
statements therein, as so amended or supplemented, will not, in the light of the
circumstances when it is so delivered, be misleading, or so that such Offering
Memorandum will comply with applicable law, and to furnish to the Initial
Purchasers and such other persons as the Initial Purchasers may specify such
number of copies thereof as the Initial Purchasers may reasonably request.
(e) Prior to the sale of all Series A Notes pursuant to Exempt
Resales as contemplated hereby, to cooperate with the Initial Purchasers and
counsel for the Initial Purchasers in connection with the registration or
qualification of the Series A Notes for offer and sale to the Initial Purchasers
and pursuant to Exempt Resales under the state securities or Blue Sky laws of
such jurisdictions as the Initial Purchasers may request, to continue such
registration or qualification in effect so long as required for Exempt Resales
and to file such consents to service of process or other documents as may be
necessary in order to effect such registration or qualification; provided,
however, that neither the Company nor any Guarantor shall be required in
connection therewith to qualify as a foreign corporation in any jurisdiction in
which it is not now so qualified or to take any action that would subject it to
general consent to service of process or taxation other than as to matters and
transactions relating to the Preliminary Offering Memorandum, the Offering
Memorandum or Exempt Resales, in any jurisdiction in which it is not now so
subject.
(f) So long as any of the Series A Notes are outstanding prior to
the consummation of the Exchange Offer, to furnish to the Initial Purchasers as
soon as available copies of all reports or other communications furnished by the
Company or any of the Guarantors to its
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security holders or furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company or any of
the Guarantors is listed and such other publicly available information
concerning the Company and/or its subsidiaries as the Initial Purchasers may
reasonably request.
(g) So long as any of the Series A Notes remain outstanding prior
to the consummation of the Exchange Offer and during any period in which the
Company and the Guarantors are not subject to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), to make
available to any holder of Series A Notes in connection with any sale thereof
and any prospective purchaser of such Series A Notes from such holder, the
information ("RULE 144A INFORMATION") required by Rule 144A(d)(4) under the
Securities Act.
(h) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of the obligations of the Company
and the Guarantors under this Agreement, including: (i) the fees, disbursements
and expenses of counsel to the Company and the Guarantors and accountants of the
Company and the Guarantors in connection with the sale and delivery of the
Series A Notes to the Initial Purchasers and pursuant to Exempt Resales, and all
other fees and expenses in connection with the preparation, printing and
distribution of the Preliminary Offering Memorandum, the Offering Memorandum and
all amendments and supplements to any of the foregoing (including financial
statements) prior to or during the period specified in Section 5(c), including
the mailing and delivering of copies thereof to the Initial Purchasers and
persons designated by them in the quantities specified herein, (ii) all costs
and expenses related to the transfer and delivery of the Series A Notes to the
Initial Purchasers and pursuant to Exempt Resales, including any transfer or
other taxes payable thereon, (iii) all costs of printing or producing this
Agreement, the other Operative Documents and any other agreements or documents
in connection with the offering, purchase, sale or delivery of the Series A
Notes, (iv) all expenses in connection with the registration or qualification of
the Series A Notes and the Guarantees for offer and sale under the securities or
Blue Sky laws of the several states and all costs of printing or producing any
preliminary and supplemental Blue Sky memoranda in connection therewith
(including the filing fees and fees and disbursements of counsel for the Initial
Purchasers in connection with such registration or qualification and memoranda
relating thereto), (v) the cost of printing certificates representing the Series
A Notes and the Guarantees, (vi) all expenses and listing fees in connection
with the application for quotation of the Series A Notes in the National
Association of Securities Dealers, Inc. ("NASD") Automated Quotation System -
PORTAL ("PORTAL"), (vii) the fees and expenses of the Trustee and the Trustee's
counsel in connection with the Indenture, the Notes and the Guarantees, (viii)
the costs and charges of any transfer agent, registrar and/or depositary
(including DTC), (ix) any fees charged by rating agencies for the rating of the
Notes, (x) all costs and expenses of the Exchange Offer and any Registration
Statement, as set forth in the Registration Rights Agreement, and (xi) all other
costs and expenses incident to the performance of the obligations of the Company
and the Guarantors hereunder for which provision is not otherwise made in this
Section.
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(i) To use its reasonable best efforts to effect the inclusion of
the Series A Notes in PORTAL and to maintain the listing of the Series A Notes
on PORTAL for so long as the Series A Notes are outstanding.
(j) To obtain the approval of DTC for "book-entry" transfer of
the Notes, and to comply in all material respects with all of its agreements set
forth in the representation letters of the Company and the Guarantors to DTC
relating to the approval of the Notes by DTC for "book-entry" transfer.
(h) During the period beginning on the date hereof and continuing
to and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any debt securities of the Company or any
Guarantor or any warrants, rights or options to purchase or otherwise acquire
debt securities of the Company or any Guarantor substantially similar to the
Notes and the Guarantees (other than (i) the Notes and the Guarantees and (ii)
commercial paper issued in the ordinary course of business), without the prior
written consent of the Initial Purchasers.
(l) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Securities
Act) that would be integrated with the sale of the Series A Notes to the Initial
Purchasers or pursuant to Exempt Resales in a manner that would require the
registration of any such sale of the Series A Notes under the Securities Act.
(m) Not to voluntarily claim, and to actively resist any attempts
to claim, the benefit of any usury laws against the holders of any Notes and the
related Guarantees.
(n) To cause the Exchange Offer to be made in the appropriate
form to permit Series B Notes and guarantees thereof by the Guarantors
registered pursuant to the Securities Act to be offered in exchange for the
Series A Notes and the Guarantees and to comply with all applicable federal and
state securities laws in connection with the Exchange Offer.
(o) To comply with all of its agreements set forth in the
Registration Rights Agreement.
(p) To use its reasonable best efforts to do and perform all
things required or necessary to be done and performed under this Agreement by it
prior to the Closing Date and to satisfy all conditions precedent to the
delivery of the Series A Notes and the Guarantees.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND
THE GUARANTORS. As of the date hereof, each of the Company and the Guarantors
represents and warrants to, and agrees with, each Initial Purchaser that:
(a) The Preliminary Offering Memorandum and the Offering
Memorandum do not, and any supplement or amendment to them will not, contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
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therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
paragraph (a) do not apply to statements in or omissions from the Preliminary
Offering Memorandum or the Offering Memorandum (or any supplement or amendment
thereto) based upon information relating to any Initial Purchaser furnished to
the Company in writing by such Initial Purchaser expressly for use therein. No
stop order preventing the use of the Preliminary Offering Memorandum or the
Offering Memorandum, or any amendment or supplement thereto, or any order
asserting that any of the transactions contemplated by this Agreement are
subject to the registration requirements of the Securities Act, has been issued.
(b) Each of the Company and its subsidiaries set forth on
Schedule C hereto (the "MATERIAL SUBSIDIARIES") has been duly incorporated or
formed, is validly existing as a corporation, limited liability company or
limited partnership in good standing under the laws of its jurisdiction of
incorporation or formation and has the corporate or limited liability company
power and authority (or the requisite authority under its limited partnership
agreement and the partnership laws of its jurisdiction of formation) to carry on
its business as described in the Preliminary Offering Memorandum and the
Offering Memorandum and to own, lease and operate its properties, and each is
duly qualified and is in good standing as a foreign corporation or limited
liability company authorized to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property requires such
qualification, except where the failure to be so qualified would not reasonably
be expected to have a material adverse effect on the business, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole.
(c) All outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid, non-assessable and
not subject to any preemptive or similar rights.
(d) All of the outstanding shares of capital stock or other
evidences of ownership of each of the Company's Material Subsidiaries have been
duly authorized and validly issued and are fully paid and non-assessable, and
are owned by the Company, directly or indirectly through one or more
subsidiaries, free and clear of any security interest, claim, lien, encumbrance
or adverse interest of any nature (each, a "LIEN").
(e) This Agreement has been duly authorized, executed and
delivered by the Company and each of the Guarantors.
(f) The Indenture has been duly authorized by the Company and
each of the Guarantors and, on the Closing Date, will have been validly executed
and delivered by the Company and each of the Guarantors. When the Indenture has
been duly executed and delivered by the Company, each of the Guarantors and the
Trustee, the Indenture will be a valid and binding agreement of the Company and
each Guarantor, enforceable against the Company and each Guarantor in accordance
with its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization or similar laws affecting creditors' rights generally
and subject to general
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principles of equity regardless of whether such enforcement is sought in a
proceeding at law or in equity (the "Enforceability Exceptions"). On the Closing
Date, the Indenture will conform in all material respects to the requirements of
the Trust Indenture Act of 1939, as amended (the "TIA" or "TRUST INDENTURE
ACT"), and the rules and regulations of the Commission applicable to an
indenture which is qualified thereunder.
(g) The Series A Notes have been duly authorized and, on the
Closing Date, will have been validly executed and delivered by the Company. When
the Series A Notes have been issued, executed and authenticated in accordance
with the provisions of the Indenture and delivered to and paid for by the
Initial Purchasers in accordance with the terms of this Agreement, the Series A
Notes will be entitled to the benefits of the Indenture and will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, subject to the Enforceability Exceptions. On the
Closing Date, the Series A Notes will conform as to legal matters to the
description thereof contained in the Offering Memorandum.
(h) On the Closing Date, the Series B Notes will have been duly
authorized by the Company. When the Series B Notes are issued, executed and
authenticated in accordance with the terms of the Exchange Offer and the
Indenture, the Series B Notes will be entitled to the benefits of the Indenture
and will be the valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, subject to the
Enforceability Exceptions.
(i) The Guarantee to be endorsed on the Series A Notes by each
Guarantor has been duly authorized by such Guarantor and, on the Closing Date,
will have been duly executed and delivered by each such Guarantor. When the
Series A Notes have been issued, executed and authenticated in accordance with
the Indenture and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, the Guarantee of each Guarantor
endorsed thereon will be entitled to the benefits of the Indenture and will be
the valid and binding obligation of such Guarantor, enforceable against such
Guarantor in accordance with its terms, subject to the Enforceability
Exceptions. On the Closing Date, the Guarantees to be endorsed on the Series A
Notes will conform as to legal matters to the description thereof contained in
the Offering Memorandum.
(j) The Guarantee to be endorsed on the Series B Notes by each
Guarantor has been duly authorized by such Guarantor and, when issued, will have
been duly executed and delivered by each such Guarantor. When the Series B Notes
have been issued, executed and authenticated in accordance with the terms of the
Exchange Offer and the Indenture, the Guarantee of each Guarantor endorsed
thereon will be entitled to the benefits of the Indenture and will be the valid
and binding obligation of such Guarantor, enforceable against such Guarantor in
accordance with its terms, subject to the Enforceability Exceptions. When the
Series B Notes are issued, authenticated and delivered, the Guarantees to be
endorsed on the Series B Notes will conform as to legal matters to the
description thereof in the Offering Memorandum.
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(k) The Registration Rights Agreement has been duly authorized by
the Company and each of the Guarantors and, on the Closing Date, will have been
duly executed and delivered by the Company and each of the Guarantors. When the
Registration Rights Agreement has been duly executed and delivered, the
Registration Rights Agreement will be a valid and binding agreement of the
Company and each of the Guarantors, enforceable against the Company and each
Guarantor in accordance with its terms, subject to the Enforceability
Exceptions. On the Closing Date, the Registration Rights Agreement will conform
as to legal matters to the description thereof in the Offering Memorandum.
(l) Neither the Company nor any of its Material Subsidiaries is
(i) in violation of its respective charter or bylaws or other organizational
documents or (ii) in default in the performance of any obligation, agreement,
covenant or condition contained in any indenture, loan agreement, mortgage,
lease or other agreement or instrument to which the Company or any of its
Material Subsidiaries is a party or by which the Company or any of its Material
Subsidiaries or their respective property is bound, except with respect to item
(ii) for such defaults that would not reasonably be expected to have a material
adverse effect on the business, financial condition or results of operations of
the Company and its subsidiaries, taken as a whole.
(m) The execution, delivery and performance of this Agreement and
the other Operative Documents by the Company and each of the Guarantors, the
compliance by the Company and each of the Guarantors with all the provisions
hereof and thereof and the consummation of the transactions contemplated hereby
and thereby will not (i) require any consent, approval, authorization or other
order of, or qualification with, any court or governmental body or agency
(except such as may be required under the securities or Blue Sky laws of the
various states), (ii) conflict with or constitute a breach of any of the terms
or provisions of, or a default under, the charter or bylaws or other
organizational documents of the Company or any of its Material Subsidiaries,
(iii) conflict with or constitute a breach of any of the terms or provisions of,
or a default under, any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which the Company or any of its Material Subsidiaries
is a party or by which the Company or any of its Material Subsidiaries or their
respective property is bound, (iv) violate or conflict with any applicable law
or any rule, regulation, judgment, order or decree of any court or any
governmental body or agency having jurisdiction over the Company, any of its
subsidiaries or their respective property, or (v) result in the suspension,
termination or revocation of any Authorization (as defined below) of the Company
or any of its Material Subsidiaries or any other impairment of the rights of the
holder of any such Authorization; except with respect to items (i), (iii), (iv)
and (v) for such consents, approvals, authorizations, orders or qualifications
which if not made or obtained, or conflicts, breaches, violations or defaults
which if existing, or suspensions, terminations or revocations which if
existing, would not reasonably be expected to have a material adverse effect on
the Company and its subsidiaries, taken as a whole.
(n) There are no legal or governmental proceedings pending or, to
the Company's knowledge, threatened to which the Company or any of its Material
Subsidiaries is or could be a party or to which any of their respective property
is or could be subject that are required to be
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described in the Preliminary Offering Memorandum or the Offering Memorandum and
are not so described; nor are there any statutes, regulations, contracts or
other documents that are required to be described in the Preliminary Offering
Memorandum or the Offering Memorandum that are not so described as required.
(o) Neither the Company nor any of its Material Subsidiaries has
violated any foreign, federal, state or local law or regulation relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS") or any
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or the rules and regulations promulgated thereunder, except for such
violations which, singly or in the aggregate, would not reasonably be expected
to have a material adverse effect on the business, financial condition or
results of operations of the Company and its subsidiaries taken as a whole.
(p) Except as disclosed in the Offering Memorandum, there are no
costs or liabilities associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any Authorization granted
thereunder, any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
reasonably be expected to have a material adverse effect on the business,
financial condition or results of operations of the Company and its subsidiaries
taken as a whole.
(q) Each of the Company and its Material Subsidiaries has such
permits, licenses, consents, exemptions, franchises, authorizations and other
approvals (each, an "AUTHORIZATION") of, and has made all filings with and
notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without limitation
under any applicable Environmental Laws, as are necessary to own, lease, license
and operate its respective properties and to conduct its business, except where
the failure to have any such Authorization or to make any such filing or notice
would not, singly or in the aggregate, have a material adverse effect on the
business, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole. Each such Authorization is valid and in full
force and effect and each of the Company and its Material Subsidiaries is in
substantial compliance with all the terms and conditions thereof and with the
rules and regulations of the authorities and governing bodies having
jurisdiction with respect thereto; and, to the knowledge of the Company, no
event has occurred (including, without limitation, the receipt of any notice
from any authority or governing body) which allows or, after notice or lapse of
time or both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would result
in any other material impairment of the rights of the holder of any such
Authorization; and, except as disclosed in the Offering Memorandum, such
Authorizations contain no restrictions that are burdensome to the Company or any
of its Material Subsidiaries; and, except as disclosed in the Offering
Memorandum; except where such failure to be valid and in full force and effect
or to be in compliance, the occurrence of any such event or the presence of any
such restriction would not, singly or in the
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aggregate, reasonably be expected to have a material adverse effect on the
business, financial condition or results of operations of the Company and its
subsidiaries taken as a whole.
(r) Coopers & Lybrand L.L.P. are independent public accountants
with respect to the Company and the Guarantors, as required by the Securities
Act.
(s) The consolidated financial statements included in the
Preliminary Offering Memorandum and the Offering Memorandum (and any amendment
or supplement thereto), together with related notes, present fairly the
consolidated financial position, results of operations and changes in financial
position of the Company and its subsidiaries on the basis stated therein at the
respective dates or for the respective periods to which they apply; such
statements and related notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; and the other historical financial and
statistical information and data set forth in the Preliminary Offering
Memorandum and the Offering Memorandum (and any amendment or supplement thereto)
are, in all material respects, accurately presented and, except as otherwise
stated therein, prepared on a basis consistent with such financial statements
and the books and records of the Company.
(t) The Company is not and, after giving effect to the offering
and sale of the Series A Notes and the application of the proceeds thereof as
described in the Offering Memorandum, will not be, an "investment company," as
such term is defined in the Investment Company Act of 1940, as amended.
(u) Except as described in the Offering Memorandum, there are no
contracts, agreements or understandings between the Company or any Guarantor and
any person granting such person the right to require the Company or such
Guarantor to file a registration statement under the Securities Act with respect
to any securities of the Company or such Guarantor or to require the Company or
such Guarantor to include such securities with the Notes and Guarantees
registered pursuant to any registration statement.
(V) Neither the Company nor any of its subsidiaries nor any agent
thereof acting on behalf of them has taken, and none of them will take, any
action that might cause this Agreement or the issuance or sale of the Series A
Notes to violate Regulation G (12 C.F.R. Part 207), Regulation T (12 C.F.R. Part
220), Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of
the Board of Governors of the Federal Reserve System.
(w) No "nationally recognized statistical rating organization,"
as such term is defined for purposes of Rule 436(g)(2) under the Securities Act
(i) has imposed (or has informed the Company or any Guarantor that it is
considering imposing) any condition (financial or otherwise) on the Company's or
any Guarantor's retaining any rating assigned to the Company or any Guarantor,
or any securities of the Company or any Guarantor or (ii) has indicated to the
Company or any Guarantor that is considering (A) the downgrading, suspension, or
withdrawal of, or any review for a possible change that does not indicate the
direction of the possible change in, any rating
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so assigned or (B) any change in the outlook for any rating of the Company or
any Guarantor, or any securities of the Company or any Guarantor.
(x) Since the respective dates as of which information is given
in the Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there has not occurred any material adverse change or any
development involving a prospective material adverse change in the condition,
financial or otherwise, or the earnings, business, management or operations of
the Company and its subsidiaries, taken as a whole, (ii) there has not been any
material adverse change or any development involving a prospective material
adverse change in the capital stock or in the long-term debt of the Company or
any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries has incurred any material liability or obligation, direct or
contingent, except for trade payables and other similar liabilities incurred in
the ordinary course of business.
(y) Each certificate signed by any officer of the Company and
delivered at the Closing to the Initial Purchasers or counsel for the Initial
Purchasers shall be deemed to be a representation and warranty by the Company to
the Initial Purchasers as to the matters covered thereby.
(z) The Company and its subsidiaries have good and indefeasible
title to all real property and good and marketable title to all personal
property owned by them and which is material to the business of the Company and
its subsidiaries, taken as a whole, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Offering Memorandum
or such as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property
by the Company and its subsidiaries; and any real property and buildings held
under lease by the Company and its subsidiaries and which are material to the
business of the Company and its subsidiaries, taken as a whole, are held by them
under valid, subsisting and enforceable leases.
(aa) The Company and each of its Material Subsidiaries are
insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the businesses in
which they are engaged; and neither the Company nor any of its Material
Subsidiaries has received notice from any insurer which indicates that the
Company or such Material Subsidiary will not be able to renew its existing
insurance coverage as and when such coverage expires.
(bb) No relationship, direct or indirect, exists between or among
the Company or any of its subsidiaries on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company or any of its
subsidiaries on the other hand, which is required by the Securities Act to be
described in the Preliminary Offering Memorandum or the Offering Memorandum
which is not so described.
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(cc) The pro forma financial statements of the Company and its
subsidiaries and the related notes thereto set forth in the Preliminary Offering
Memorandum and the Offering Memorandum (and any supplement or amendment thereto)
have been prepared on a basis consistent with the historical financial
statements of the Company and its subsidiaries, give effect to the assumptions
used in the preparation thereof on a reasonable basis and in good faith and
present fairly the historical and proposed transactions contemplated by the
Preliminary Offering Memorandum and the Offering Memorandum. The other pro forma
financial and statistical information and data set forth in the Preliminary
Offering Memorandum and the Offering Memorandum (and any supplement or amendment
thereto) are, in all material respects, accurately presented and prepared on a
basis consistent with the historical or pro forma financial statements of the
Company.
(dd) The Company and each of its Material Subsidiaries maintains
a system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(ee) All material tax returns required to be filed by the Company
and each of its subsidiaries in any jurisdiction have been filed, other than
those filings being contested in good faith, and all material taxes, including
withholding taxes, penalties and interest, assessments, fees and other charges
due pursuant to such returns or pursuant to any assessment received by the
Company or any of its subsidiaries have been paid, other than those being
contested in good faith and for which adequate reserves have been provided.
(ff) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, contains all the information specified in, and
meeting the requirements of, Rule 144A(d)(4) under the Securities Act.
(gg) When the Series A Notes and the Guarantees are issued and
delivered pursuant to this Agreement, neither the Series A Notes nor the
Guarantees will be of the same class (within the meaning of Rule 144A under the
Securities Act) as any security of the Company or the Guarantors that is listed
on a national securities exchange registered under Section 6 of the Exchange Act
or that is quoted in a United States automated inter-dealer quotation system.
(hh) No form of general solicitation or general advertising (as
defined in Regulation D under the Securities Act) was used by the Company, the
Guarantors or any of their respective representatives (other than the Initial
Purchasers, as to whom the Company and the Guarantors make no representation) in
connection with the offer and sale of the Series A Notes contemplated hereby,
including, but not limited to, articles, notices or other communications
published in any newspaper, magazine, or similar medium or broadcast over
television or radio, or
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any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising. No securities of the same class as the
Series A Notes have been issued and sold by the Company within the six-month
period immediately prior to the date hereof.
(ii) Prior to the effectiveness of any Registration Statement,
the Indenture is not required to be qualified under the TIA.
(jj) None of the Company, the Guarantors nor any of their
respective affiliates or any person acting on its or their behalf (other than
the Initial Purchasers, as to whom the Company and the Guarantors make no
representation) has engaged or will engage in any directed selling efforts
within the meaning of Regulation S under the Securities Act ("REGULATION S")
with respect to the Series A Notes or the Guarantees.
(kk) The Series A Notes offered and sold in reliance on
Regulation S have been and will be offered and sold only in offshore
transactions.
(ll) The sale of the Series A Notes pursuant to Regulation S is
not part of a plan or scheme to evade the registration provisions of the
Securities Act.
(mm) No registration under the Securities Act of the Series A
Notes or the Guarantees is required for the sale of the Series A Notes and the
Guarantees to the Initial Purchasers as contemplated hereby or for the Exempt
Resales, assuming the accuracy of the Initial Purchasers' representations and
warranties and agreements set forth in Section 7 hereof.
The Company and the Guarantors acknowledge that the Initial
Purchasers and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Section 9 hereof, counsel to the Company and the
Guarantors and counsel to the Initial Purchasers will rely upon the accuracy and
truth of the foregoing representations and hereby consents to such reliance.
7. INITIAL PURCHASERS' REPRESENTATIONS AND WARRANTIES. Each of
the Initial Purchasers, severally and not jointly, represents and warrants to
the Company and the Guarantors, and agrees that:
(a) Such Initial Purchaser is a QIB with such knowledge and
experience in financial and business matters as is necessary in order to
evaluate the merits and risks of an investment in the Series A Notes.
(b) Such Initial Purchaser (A) is not acquiring the Series A
Notes with a view to any distribution thereof or with any present intention of
offering or selling any of the Series A Notes in a transaction that would
violate the Securities Act or the securities laws of any state of the United
States or any other applicable jurisdiction and (B) will be reoffering and
reselling the Series A Notes only (x) to QIBs in reliance on the exemption from
the registration requirements of the Securities
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Act provided by Rule 144A and (y) in offshore transactions in reliance upon
Regulation S of the Securities Act.
(c) Such Initial Purchaser agrees that no form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) has been or will be used by such Initial Purchaser or any of
its representatives in connection with the offer and sale of the Series A Notes
pursuant hereto, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
(d) Such Initial Purchaser agrees that, in connection with Exempt
Resales, such Initial Purchaser will solicit offers to buy the Series A Notes
only from, and will offer to sell the Series A Notes only to, Eligible
Purchasers. Each Initial Purchaser further agrees that it will offer to sell the
Series A Notes only to, and will solicit offers to buy the Series A Notes only
from, (A) Eligible Purchasers that the Initial Purchaser reasonably believes are
QIBs and (B) Regulation S Purchasers, in each case, that agree that (x) the
Series A Notes purchased by them may be resold, pledged or otherwise transferred
within the time period referred to under Rule 144(k) (taking into account the
provisions of Rule 144(d) under the Securities Act, if applicable) under the
Securities Act, as in effect on the date of the transfer of such Series A Notes,
only (I) to the Company or any of its subsidiaries, (II) to a person whom the
seller reasonably believes is a QIB purchasing for its own account or for the
account of a QIB in a transaction meeting the requirements of Rule 144A under
the Securities Act, (III) in an offshore transaction (as defined in Rule 902
under the Securities Act) meeting the requirements of Rule 904 of the Securities
Act, (IV) in a transaction meeting the requirements of Rule 144 under the
Securities Act, (V) in accordance with another exemption from the registration
requirements of the Securities Act (and based upon an opinion of counsel
acceptable to the Company) or (VI) pursuant to an effective registration
statement and, in each case, in accordance with the applicable securities laws
of any state of the United States or any other applicable jurisdiction and (y)
they will deliver to each person to whom such Series A Notes or an interest
therein is transferred a notice substantially to the effect of the foregoing.
(e) Such Initial Purchaser and its affiliates or any person
acting on its or their behalf have not engaged and will not engage in any
directed selling efforts within the meaning of Regulation S with respect to the
Series A Notes or the Guarantees.
(f) The Series A Notes offered and sold by such Initial Purchaser
pursuant hereto in reliance on Regulation S have been and will be offered and
sold only in offshore transactions.
(G) The sale of the Series A Notes offered and sold by such
Initial Purchaser pursuant hereto in reliance on Regulation S is not part of a
plan or scheme to evade the registration provisions of the Securities Act.
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Such Initial Purchaser acknowledges that the Company and the
Guarantors and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Section 9 hereof, counsel to the Company and the
Guarantors and counsel to the Initial Purchasers will rely upon the accuracy and
truth of the foregoing representations and such Initial Purchaser hereby
consents to such reliance.
8. INDEMNIFICATION.
(a) The Company and each Guarantor agree, jointly and severally,
to indemnify and hold harmless each Initial Purchaser, its directors, its
officers and each person, if any, who controls such Initial Purchaser within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages, liabilities and judgments
(including, without limitation, any legal or other expenses incurred in
connection with investigating or defending any matter, including any action,
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Offering Memorandum (or any amendment or
supplement thereto), the Preliminary Offering Memorandum or any Rule 144A
Information provided by the Company or any Guarantor to any holder or
prospective purchaser of Series A Notes pursuant to Section 5(h) or caused by
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Initial Purchaser furnished in
writing to the Company by such Initial Purchaser; provided, however, that the
foregoing indemnity agreement with respect to any Preliminary Offering
Memorandum shall not inure to the benefit of any Initial Purchaser in connection
with any losses, claims, damages and liabilities and judgments if a copy of the
Offering Memorandum (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given to the
person asserting such losses, claims, damages, liabilities or judgments at or
prior to the written confirmation of the sale of the Series A Notes to such
person, and if the Offering Memorandum (as so amended and supplemented) would
have cured the defect giving rise to such loss, claim, damage, liability or
judgment, unless such failure to deliver such amended or supplemented Offering
Memorandum was a result of noncompliance by the Company with its delivery
obligations under Section 5 hereof.
(b) Each Initial Purchaser agrees, severally and not jointly, to
indemnify and hold harmless the Company and the Guarantors, and their respective
directors, managers and officers and each person, if any, who controls (within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) the Company or the Guarantors, to the same extent as the foregoing
indemnity from the Company and the Guarantors to such Initial Purchaser but only
with reference to information relating to such Initial Purchaser furnished in
writing to the Company by such Initial Purchaser expressly for use in the
Preliminary Offering Memorandum or the Offering Memorandum (or any amendment or
supplement thereto).
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(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and 8(b), the Initial Purchaser shall not be required to
assume the defense of such action pursuant to this Section 8(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Initial Purchaser). Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the indemnified
party unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for (i) the fees and expenses of more than one separate firm of attorneys
(in addition to any local counsel) for all Initial Purchasers, their officers
and directors and all persons, if any, who control any Initial Purchaser within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act and (ii) the fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for the Company and the Guarantors,
their respective directors, managers, officers and all persons, if any, who
control the Company and the Guarantors within the meaning of either such
Section, and all such fees and expenses shall be reimbursed as they are
incurred. In the case of any such separate firm for the Initial Purchasers,
their officers and directors and such control persons of any Initial Purchasers,
such firm shall be designated in writing by DLJ. In the case of any such
separate firm for the Company and the Guarantors and such directors, officers
and control persons of the Company and the Guarantors, such firm shall be
designated in writing by the Company. The indemnifying party shall indemnify and
hold harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action
effected with the indemnifying party's written consent, which consent will not
be unreasonably withheld. Notwithstanding the immediately preceding sentence, if
in any case where the fees and expenses of counsel are at the expense of the
indemnifying party and an indemnified party shall have requested the
indemnifying party to reimburse the indemnified party for such fees and expenses
of counsel actually incurred by it, such indemnifying party agrees that it shall
be liable for any settlement of any action effected without its written consent
if (i) such settlement is entered into more than 60 days after the receipt by
such indemnifying party of the aforesaid request (ii) such indemnifying party
shall have received notice
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of the proposed settlement being entered into at least 20 days prior to such
settlement being entered into and (iii) prior to the date of such settlement
such indemnifying party shall have failed to reimburse the indemnified party in
accordance with such request for reimbursement (or, if within 30 days of the
receipt of the aforesaid request, the indemnifying party shall have made a good
faith written challenge to the reasonableness of the amount of the reimbursement
requested or the sufficiency of the documentation supporting the reimbursement
requested (which challenge shall specifically set forth the amount of the
requested reimbursement which the indemnifying party in good faith believes to
be unreasonable or the basis for the good faith claim as to the insufficiency of
any supporting documentation), this sentence shall only apply if such
indemnifying party shall not have reimbursed the indemnified party for the
amount which is not being so challenged). No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this
Section 8 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages, liabilities or judgments referred to therein, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantors, on the one hand, and the Initial Purchasers on the
other hand from the offering of the Series A Notes or (ii) if the allocation
provided by clause 8(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 8(d)(i) above but also the relative fault of the Company and the
Guarantors, on the one hand, and the Initial Purchasers, on the other hand, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Guarantors, on the one hand and the Initial Purchasers, on the other hand, shall
be deemed to be in the same proportion as the total net proceeds from the
offering of the Series A Notes (after discounts and commissions, but before
deducting expenses) received by the Company, and the total discounts and
commissions received by the Initial Purchasers, bear to the total price to
investors of the Series A Notes, in each case as set forth in the table on the
cover page of the Offering Memorandum. The relative fault of the Company and the
Guarantors, on the one hand, and the Initial Purchasers, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or the
Guarantors, on the one hand, or the Initial Purchasers, on the other hand, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
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The Company, the Guarantors and the Initial Purchasers agree that
it would not be just and equitable if contribution pursuant to this Section 8(d)
were determined by pro rata allocation (even if the Initial Purchasers were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages, liabilities or judgments
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred
by such indemnified party in connection with investigating or defending any
matter, including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 8, no Initial Purchaser shall be required to contribute any amount in
excess of the amount by which the total price at which the Series A Notes
purchased by it hereunder and resold to Eligible Purchasers were offered to the
Eligible Purchasers exceeds the amount of any damages which such Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations to contribute
pursuant to this Section 8(d) are several in proportion to the respective
principal amount of Series A Notes purchased by each of the Initial Purchasers
hereunder and not joint.
(e) The remedies provided for in this Section 8 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
9. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS. The several
obligations of the Initial Purchasers to purchase the Series A Notes under this
Agreement are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company and the
Guarantors contained in this Agreement shall be true and correct (in the case of
representations and warranties that are qualified as to materiality) or true and
correct in all material respects (in the case of representations and warranties
that are not so qualified) on the Closing Date with the same force and effect as
if made on and as of the Closing Date.
(b) On or after the date hereof, (i) there shall not have
occurred any downgrading, suspension or withdrawal of, nor shall any notice have
been given of any potential or intended downgrading, suspension or withdrawal
of, or of any review (or of any potential or intended review) for a possible
change that does not indicate the direction of the possible change in, any
rating of the Company or any Guarantor or any securities of the Company or any
Guarantor (including, without limitation, the placing of any of the foregoing
ratings on credit watch with negative or developing implications or under review
with an uncertain direction) by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2) under the
Securities Act,
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(ii) there shall not have occurred any change, nor shall any notice have been
given of any potential or intended change, in the outlook for any rating of the
Company or any Guarantor or any securities of the Company or any Guarantor by
any such rating organization and (iii) no such rating organization shall have
given notice that it has assigned (or is considering assigning) a lower rating
to the Series A Notes than that on which the Series A Notes were marketed.
(c) You shall have received on the Closing Date a certificate
dated the Closing Date, signed by James E. Brown and David E. Grose, in their
respective capacities as the Chief Executive Officer and Chief Financial Officer
of the Company, confirming the matters set forth in Sections 6(y), 9(a) and 9(b)
and stating that the Company and each of the Guarantors has complied with all of
the agreements and satisfied all of the conditions herein contained and required
to be complied with or satisfied by the Company or such Guarantor on or prior to
the Closing Date.
(d) Since the respective dates as of which information is given
in the Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there shall not have occurred any change or any development
involving a prospective change in the condition, financial or otherwise, or the
earnings, business, management or operations of the Company and its
subsidiaries, taken as a whole, (ii) there shall not have been any change or any
development involving a prospective change in the capital stock or in the
long-term debt of the Company or any of its subsidiaries and (iii) neither the
Company nor any of its subsidiaries shall have incurred any liability or
obligation, direct or contingent, the effect of which, in any such case
described in clause 9(d)(i), 9(d)(ii) or 9(d)(iii), in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market the
Series A Notes on the terms and in the manner contemplated in the Offering
Memorandum.
(e) You shall have received on the Closing Date an opinion (in a
form reasonably satisfactory to you and counsel for the Initial Purchasers)
dated the Closing Date, of Baker & Botts, L.L.P., counsel for the Company and
the Guarantors, or McAfee & Taft A Professional Corporation, Oklahoma counsel
for the Company and the Guarantors, with respect to the portions of the opinions
rendered below involving questions of Oklahoma law, to the effect that:
(i) Each of the Company and its Material Subsidiaries which are
corporations has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation and has all requisite corporate power and authority to
own, lease and operate its property and to conduct its business as
described in the Offering Memorandum; Bayard Drilling, L.L.C. has been
duly formed and is validly existing as a limited liability company in
good standing under the Delaware Limited Liability Company Act and has
all requisite power and
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authority under its limited liability company agreement and the
Delaware Limited Liability Company Act to own, lease and operate its
property and to conduct its business as described in the Offering
Memorandum; and Bayard Drilling, L.P. has been duly formed and is
validly existing as a limited partnership in good standing under the
Delaware Revised Uniform Limited Partnership Act and has all
requisite power and authority under its agreement of limited
partnership and the Delaware Revised Uniform Limited Partnership Act
to own, lease and operate its property and to conduct its business as
described in the Offering Memorandum;
(ii) Each of the Company and its Material Subsidiaries is duly
qualified and is in good standing as a foreign corporation or foreign
limited liability company or foreign limited partnership (as the case
may be) authorized to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so
qualified would not reasonably be expected to have a material adverse
effect on the business, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole; provided
however that (i) in rendering such opinion as to the jurisdictions in
which the Company and its Material Subsidiaries do business or own or
lease property, such counsel may rely solely upon certificates of
officers of the Company and (ii) in rendering such opinion as to
whether each of the Company and its Material Subsidiaries is duly
qualified and in good standing in such jurisdictions, such counsel may
rely solely upon certificates of governmental officials of such
jurisdictions;
(iii) All of the outstanding shares of capital stock of each of
the Material Subsidiaries which are corporations have been duly
authorized and validly issued and are fully paid and non-assessable;
all of the outstanding limited liability company interests in Bayard
Drilling L.L.C. have been duly authorized and validly issued in
accordance with the limited liability company agreement of Bayard
Drilling L.L.C. in exchange for the capital contributions specified
therein; all of the outstanding limited partnership interests in
Bayard Drilling, L.P. have been duly authorized and validly issued in
accordance with the limited partnership agreement of Bayard Drilling,
L.P. in exchange for the capital contributions specified therein; and,
to the Company's knowledge, all of the outstanding shares of capital
stock or limited liability company interests, as the case may be, of
the Material Subsidiaries are owned by the Company, directly or
indirectly through one or more subsidiaries, free and clear of any
perfected security interest;
(iv) This Agreement has been duly authorized by all necessary
corporate action on the part of the Company and each Guarantor and has
been executed and delivered by the Company and each Guarantor;
(v) The Series A Notes have been duly authorized by all necessary
corporate action on the part of the Company and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement and the Indenture, will be entitled to the
benefits of the Indenture and will be valid and binding obligations of
the Company, enforceable against the Company in accordance with their
terms, subject to the Enforceability Exceptions;
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(vi) The Guarantees have been duly authorized by all necessary
corporate action on the part of each Guarantor and, when the Series A
Notes are executed and authenticated in accordance with the provisions
of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, the
Guarantees endorsed thereon will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Guarantors,
enforceable against the Guarantors in accordance with their terms,
subject to the Enforceability Exceptions;
(vii) The Indenture has been duly authorized by all necessary
corporate action on the part of the Company and each Guarantor, has
been executed and delivered by the Company and each Guarantor and is a
valid and binding agreement of the Company and each Guarantor,
enforceable against the Company and each Guarantor in accordance with
its terms, subject to the Enforceability Exceptions and subject to any
limitations on the enforceability thereof imposed by the applicable
provisions of federal or state securities laws or principles of public
policy underlying such laws; provided, however, that such counsel
shall not be required to opine upon the enforceability of the
indemnification and contribution provisions contained in the
Indenture;
(viii) The Registration Rights Agreement has been duly authorized
by all necessary corporate action on the part of the Company and each
Guarantor, has been executed and delivered by the Company and each
Guarantor and is a valid and binding agreement of the Company and each
Guarantor, enforceable against the Company and each Guarantor in
accordance with its terms, subject to the Enforceability Exceptions
and subject to any limitations on the enforceability thereof imposed
by the applicable provisions of federal or state securities laws or
principles of public policy underlying such laws; provided, however,
that such counsel shall not be required to opine upon the
enforceability of the indemnification and contribution provisions
contained in the Registration Rights Agreement;
(ix) The Series B Notes have been duly authorized by all
necessary corporate action on the part of the Company;
(x) The statements under the captions, "Management" (solely with
respect to the terms of the employment agreements and indemnification
agreements discussed therein, and under the captions "1997 Stock
Option and Stock Award Plan" and "1997 Non-Employee Directors' Stock
Option Plan" and the agreements relating to existing awards granted
under such stock plans), "Certain Relationships and Related
Transactions" (solely with respect to (i) the terms of the
registration rights agreements and the stockholders and voting
agreement discussed therein, (ii) the matters described under the
captions "--Certain Arrangements Related to the Consolidation
Transactions--The Formation Transactions--Chesapeake Option,"
"--Chesapeake Drilling Agreements" and "--Oliver Companies' Put
Rights," (iii) the matters described under the captions "--Certain
Arrangements Related to the Consolidation Transactions--The Ward
Acquisition," and "--The Bonray Acquisition," and (iv) the matters
described under the captions "--Certain Financing Arrangements,"
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"--Chesapeake Transactions" and "--Other Related Party Transactions
and Arrangements--Fees Paid to Energy Spectrum Advisors"),
"Description of Notes" and "Plan of Distribution" in the Offering
Memorandum, insofar as such statements constitute a summary of the
legal matters or documents referred to therein, are accurate and
fairly present the information set forth therein, in each case in all
material respects;
(xi) No consent, approval, authorization or order of, or
qualification with, any Applicable Governmental Authority (as
hereinafter defined) is required pursuant to any Applicable Laws (as
hereinafter defined) for the execution and delivery of this Agreement
and the other Operative Documents by the Company and each Guarantor,
the performance by the Company and each Guarantor of its respective
obligations hereunder and thereunder or the consummation by the
Company and each Guarantor of the transactions contemplated hereby and
thereby, except for (i) the filing and effectiveness of a registration
statement by the Company and the Guarantors with the Commission
pursuant to the Securities Act and qualification of the Indenture
under the Trust Indenture Act and (ii) any such consent, approval,
authorization, order or qualification which (A) has been made or
obtained prior to the Closing Date or (B) may be required under
applicable state or foreign securities or Blue Sky laws (as to which
such counsel need not express an opinion) or (C) if not made or
obtained would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(xii) The execution and delivery of this Agreement and the other
Operative Documents by the Company and each Guarantor, the performance
by the Company and each Guarantor of its obligations hereunder and
thereunder and the consummation by the Company and each Guarantor of
the transactions contemplated hereby and thereby will not (i) result
in a violation of the terms of the certificate of incorporation,
bylaws, certificate of formation, limited liability company agreement
or agreement of limited partnership (in each case, as applicable) of
the Company or the Material Subsidiaries, (ii) result in a breach or
violation of or constitute (either alone or with notice or the passage
of time, or both) a default under, any agreement, mortgage, deed of
trust, lease, franchise, license, indenture, permit or other
instrument to which the Company or its Material Subsidiaries is a
party or by which the Company, the Material Subsidiaries or their
properties are bound that is included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1997, or (iii) result in
a violation of any Applicable Laws to which the Company, the Material
Subsidiaries or their properties are subject or any judgment, decree
or order of any Applicable Governmental Authority that specifically
names the Company, the Material Subsidiaries or is directed at their
property (provided, however, that such counsel need not express an
opinion with respect to compliance with any federal or state
securities or antifraud law, rule or regulation except as otherwise
specifically stated in the opinion of such counsel); except for any
such violation, breach or default referred to in clause (i), (ii) or
(iii) above which would not have a material adverse effect on the
Company and its subsidiaries taken as a whole;
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26
(xiii) To the knowledge of such counsel, there are no legal or
governmental proceedings pending or threatened against the Company or
any of the Material Subsidiaries or by which any of their respective
property is or could be subject that are required to be described in
the Preliminary Offering Memorandum or the Offering Memorandum and are
not so described;
(xiv) The Company is not and, after giving effect to the offering
and sale of the Series A Notes and the application of the proceeds
thereof as described in the Offering Memorandum, will not be, an
"investment company" as such term is defined in the Investment Company
Act of 1940, as amended;
(xvi) The Indenture complies as to form in all material respects
with the requirements of the TIA, and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder.
It is not necessary in connection with the offer, sale and delivery of
the Series A Notes to the Initial Purchasers in the manner
contemplated by this Agreement or in connection with the Exempt
Resales to qualify the Indenture under the TIA; and
(xvi) No registration under the Securities Act of the Series A
Notes is required for the sale of the Series A Notes to the Initial
Purchasers as contemplated by this Agreement or for the Exempt Resales
assuming (i) each Initial Purchaser is a QIB or a Regulation S
Purchaser, (ii) the purchasers who buy the Series A Notes in the
Exempt Resales are Eligible Purchasers, (iii) the accuracy of, and
compliance with, the Initial Purchaser's representations and
agreements contained in Section 7 of this Agreement, (iv) the accuracy
of the representations of the Company and the Guarantors set forth in
Sections 6(jj), (kk) and (ll) of this Agreement, (v) receipt by the
purchasers to whom the Initial Purchasers initially resell the Series
A Notes of a copy of the Offering Memorandum at or prior to the
delivery of confirmation of sale and (vi) the certificates
representing the Series A Notes bear the legends contemplated by the
Indenture.
As used herein, (i) the term "APPLICABLE LAWS" means the General
Corporation Law of the State of Delaware, the contract laws of the
State of New York, the laws of the State of Texas and the laws of the
United States of America that, in the experience of such counsel, are
normally applicable to transactions of the type contemplated by this
Agreement and (ii) the term "APPLICABLE GOVERNMENTAL AUTHORITY" means
any governmental authority or body of the United States of America or
the State of Texas or the State of New York or (solely with respect to
the General Corporation Law of the State of Delaware) the State of
Delaware.
Such opinion shall also include a statement to the effect that
although such counsel did not independently verify, are not passing
upon and do not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the Offering
Memorandum (except to the extent stated in paragraph (e)(x) above),
they advise you that
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no facts have come to their attention which lead them to believe that
the Offering Memorandum (other than (i) the financial statements
(including the notes thereto and the auditors' report thereon)
included therein, and (ii) the other financial and statistical
information included therein, as to which such counsel need express no
opinion), as of its date and as of the Closing Date, contained or
contains any untrue statement of a material fact or omitted or omits
to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under
which they were made, not misleading.
The opinion of Baker & Botts, L.L.P. or such other counsel as described
in Section 9(e) above shall be rendered to you at the request of the Company and
the Guarantors, and shall so state therein.
(f) You shall have received on the Closing Date an opinion, dated
the Closing Date, of Andrews & Kurth L.L.P., counsel for the Initial
Purchasers, in form and substance reasonably satisfactory to the Initial
Purchasers.
In giving such opinions with respect to the matters covered by
the last paragraph of Section 9(e), Baker & Botts, L.L.P. and Andrews & Kurth
L.L.P. may state that their opinion and belief are based upon their
participation in the preparation of the Offering Memorandum and any amendments
or supplements thereto and review and discussion of the contents thereof, but
are without independent check or verification except as specified.
(g) The Initial Purchasers shall have received, at the time this
Agreement is executed and at the Closing Date, letters dated the date hereof or
the Closing Date, as the case may be, in form and substance satisfactory to the
Initial Purchasers from Coopers & Lybrand L.L.P. and Grant Thornton L.L.P.,
independent public accountants, containing the information and statements of the
type ordinarily included in accountants' "comfort letters" to the Initial
Purchasers with respect to the financial statements and certain financial
information contained in the Offering Memorandum.
(h) The Series A Notes shall have been approved by the NASD for
trading and duly listed in PORTAL.
(i) The Initial Purchasers shall have received a counterpart,
conformed as executed, of the Indenture which shall have been entered into by
the Company, the Guarantors and the Trustee.
(j) The Company and the Guarantors shall have executed the
Registration Rights Agreement and the Initial Purchasers shall have received an
original copy thereof, duly executed by the Company and the Guarantors.
(k) The Company shall have consummated the TransTexas Acquisition,
as defined in the Offering Memorandum.
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(l) Neither the Company nor the Guarantors shall have failed at or
prior to the Closing Date to perform or comply with any of the agreements herein
contained and required to be performed or complied with by the Company or the
Guarantors, as the case may be, at or prior to the Closing Date.
10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by the Initial Purchasers by written notice to the Company if any of the
following has occurred: (i) any outbreak or escalation of hostilities or other
national or international calamity or crisis or change in economic conditions or
in the financial markets of the United States or elsewhere that, in the Initial
Purchasers' judgment, is material and adverse and, in the Initial Purchasers'
judgment, makes it impracticable to market the Series A Notes on the terms and
in the manner contemplated in the Offering Memorandum, (ii) the suspension or
material limitation of trading in securities or other instruments on the New
York Stock Exchange, the American Stock Exchange, the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or the
Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company or any Guarantor on any
exchange or in the over-the-counter market, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of any court or other governmental authority which in your opinion
materially and adversely affects, or will materially and adversely affect, the
business, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by
either federal or New York State authorities or (vi) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
If on the Closing Date any one or more of the Initial Purchasers shall
fail or refuse to purchase the Series A Notes which it or they have agreed to
purchase hereunder on such date and the aggregate principal amount of the Series
A Notes which such defaulting Initial Purchaser or Initial Purchasers, as the
case may be, agreed but failed or refused to purchase is not more than one-tenth
of the aggregate principal amount of the Series A Notes to be purchased on such
date by all Initial Purchasers, each non-defaulting Initial Purchaser shall be
obligated severally, in the proportion which the principal amount of the Series
A Notes set forth opposite its name in Schedule B bears to the aggregate
principal amount of the Series A Notes which all the non-defaulting Initial
Purchasers, as the case may be, agreed but failed or refused to purchase on such
date; provided that in no event shall the aggregate principal amount of the
Series A Notes which any Initial Purchaser has agreed to purchase pursuant to
Section 2 hereof be increased pursuant to this Section 10 by an amount in excess
of one-ninth of such principal amount of the Series A Notes without the written
consent of such Initial Purchaser. If on the Closing Date any Initial Purchaser
or Initial Purchasers shall fail or refuse to purchase Series A Notes and the
aggregate principal amount of the Series A Notes with
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respect to which such default or defaults occur is more than one-tenth of the
aggregate principal amount of the Series A Notes to be purchased by all Initial
Purchasers and arrangements satisfactory to the Initial Purchasers and the
Company for purchase of such the Series A Notes are not made within 48 hours
after such default, this Agreement will terminate without liability on the part
of any non-defaulting Initial Purchaser, the Company or the Guarantors. In any
such case which does not result in termination of this Agreement, either the
Initial Purchasers or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Offering Memorandum or any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Initial Purchaser from liability in respect of any
default of any such Initial Purchaser under this Agreement.
11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company or any Guarantor,
to Bayard Drilling Technologies, Inc., 4005 N.W. Expressway, Suite 550E,
Oklahoma City, OK 73116, and (ii) if to any Initial Purchaser, to it c/o
Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York,
New York 10172, Attention: Syndicate Department, or in any case to such other
address as the person to be notified may have requested in writing.
12. The respective indemnities, contribution agreements,
representations, warranties and other statements of the Company, the Guarantors
and the Initial Purchasers set forth in or made pursuant to this Agreement shall
remain operative and in full force and effect, and will survive delivery of and
payment for the Series A Notes, regardless of (i) any investigation, or
statement as to the results thereof, made by or on behalf of the Initial
Purchasers, the officers or directors of the Initial Purchasers, any person
controlling the Initial Purchasers, the Company, any Guarantor, the officers,
managers or directors of the Company or any Guarantor, or any person controlling
the Company or any Guarantor, (ii) acceptance of the Series A Notes and payment
for them hereunder and (iii) termination of this Agreement.
If for any reason the Series A Notes are not delivered by or on
behalf of the Company as provided herein (other than as a result of any
termination of this Agreement pursuant to Section 10 or a breach on the part of
the Initial Purchasers), the Company and each Guarantor, jointly and
severally, agree to reimburse the several Initial Purchasers for all
out-of-pocket expenses (including, without limitation, the fees and
disbursements of counsel) reasonably incurred by them in connection with the
proposed offering of the Series A Notes. Notwithstanding any termination of
this Agreement, the Company shall be liable for all expenses which it has
agreed to pay pursuant to Section 5(i) hereof. The Company and each Guarantor
also agree, jointly and severally, to reimburse the several Initial Purchasers,
their directors and officers and any persons controlling any of the Initial
Purchasers within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act for any and all fees and expenses (including, without
limitation, the fees and disbursements of counsel) reasonably incurred by them
in connection with enforcing their rights hereunder (including, without
limitation, pursuant to Section 8 hereof). The Initial Purchasers also agree,
jointly and severally, to reimburse the Company and the Guarantors for any and
all fees and expenses (including, without limitation, the fees and
disbursements of counsel) reasonably incurred
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by them in connection with enforcing their rights hereunder (including, without
limitation, pursuant to Section 8 hereof).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the Guarantors,
the Initial Purchasers, the Initial Purchasers' directors and officers, any
controlling persons referred to herein, the directors, officers and managers of
the Company and the Guarantors and their respective successors and assigns, all
as and to the extent provided in this Agreement, and no other person shall
acquire or have any right under or by virtue of this Agreement. The term
"successors and assigns" shall not include a purchaser of any of the Series A
Notes from the Initial Purchasers merely because of such purchase.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Guarantors and the Initial Purchasers.
Very truly yours,
BAYARD DRILLING TECHNOLOGIES, INC.
By: /s/ JAMES E. BROWN
-----------------------------------
James E. Brown
President
BAYARD DRILLING, L.L.C.
By: /s/ JAMES E. BROWN
-----------------------------------
James E. Brown
President
BAYARD DRILLING, L.P.
By: Bayard Drilling, L.L.C., its general partner
By: /s/ JAMES E. BROWN
-----------------------------------
James E. Brown
President
BONRAY DRILLING CORPORATION
By: /s/ JAMES E. BROWN
-----------------------------------
James E. Brown
President
TREND DRILLING CO.
By: /s/ JAMES E. BROWN
-----------------------------------
James E. Brown
President
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DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
LEHMAN BROTHERS INC.
BT ALEX. BROWN
DAIN RAUSCHER WESSELS
By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION,
on its own behalf and on behalf of
the Initial Purchasers
By: /s/ DWIGHT SCOTT
-----------------------------------
Name: Dwight Scott
Title: Senior Vice President
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SCHEDULE A
GUARANTORS
Bayard Drilling, L.L.C.
Bayard Drilling, L.P.
Bonray Drilling Corporation
Trend Drilling Co.
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SCHEDULE B
Principal Amount
Initial Purchaser of Notes of Notes
-------------------------- ----------------
Donaldson, Lufkin & Jenrette
Securities Corporation............................ $ 60,000,000
Lehman Brothers...................................... $ 20,000,000
BT Alex. Brown....................................... $ 15,000,000
Dain Rauscher........................................ $ 5,000,000
------------
Total................................................ $100,000,000
------------
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SCHEDULE C
MATERIAL SUBSIDIARIES OF THE COMPANY
Bayard Drilling, L.L.C.
Bayard Drilling, L.P.
Bonray Drilling Corporation
Trend Drilling Co.
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