Exhibit 10.5

Execution Version

SECOND CONSENT AND WAIVER AGREEMENT

BY THE HOLDERS OF THE

12% REDEEMABLE PREFERRED STOCK

OF

MCDERMOTT INTERNATIONAL, INC.

December 1, 2019

Reference is made to (i) that certain Certificate of Designation providing for
the designations, preferences, limitations and relative rights, voting,
redemption and other rights and the qualifications, limitations or restrictions
of the Company’s 12% Redeemable Preferred Stock (the “Preferred Stock”), dated
October 30, 2018 (as amended by that certain Certificate of Amendment thereto,
dated October 24, 2019, the “Certificate of Designation”), of McDermott
International, Inc., a corporation incorporated and existing under the laws of
the Republic of Panama (the “Company”) and (ii) that certain Superpriority
Senior Secured Credit Agreement, dated October 21, 2019, by and among the
Company, as a guarantor, McDermott Technology (Americas), Inc., a Delaware
corporation (“MTA”), McDermott Technology (US), Inc., a Delaware corporation
(“MTUS”) and McDermott Technology, B.V., a private company with limited
liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated
under the laws of the Netherlands, the lenders party thereto, the Issuers (as
defined therein), Credit Agricole Corporate and Investment Bank, as
administrative agent for the Revolving Facility (as defined therein) and
Barclays Bank PLC as administrative agent for the Term Facility (as defined
therein) (as amended by that certain Amendment No 1. thereto (the “Superpriority
Amendment”), dated as of the Effective Date, attached hereto as Exhibit A, the
“Superpriority Credit Agreement”). As of the date of hereof, the undersigned
holders (together with their respective permitted transferees from time to time
in accordance with the terms of the Securities Purchase Agreement, dated
October 30, 2018 (as amended by Amendment No. 1 thereto, dated October 25,
2019), collectively, the “Holder”) collectively hold of record all of the issued
and outstanding shares of the Preferred Stock. Capitalized terms used in this
Second Consent and Waiver Agreement (including all exhibits attached hereto,
this “Agreement”) but not otherwise defined herein shall have the meanings
ascribed to them in the Certificate of Designation.

WHEREAS, on October 21, 2019, pursuant to the Consent and Waiver Agreement by
and among the Company and the Holder, the Holder consented to the Company’s
incurrence of additional indebtedness under the Superpriority Credit Agreement
in an amount equal to the Tranche A Term Commitments (as defined in the
Superpriority Credit Agreement) plus the aggregate amount of Letter of Credit
Issuer Commitments (as defined in the Superpriority Credit Agreement) available
to the Company on the effective date of the Superpriority Credit Agreement;

WHEREAS, the Company, along with certain of its subsidiaries, proposes to incur
additional Indebtedness (as defined in the Current Credit Agreement (such
Indebtedness, the “New Indebtedness”, and incurrence of the New Indebtedness and
consummation of the transactions contemplated thereby, the “Proposed Financing”)
in accordance with the terms and conditions set forth in the Superpriority
Credit Agreement (together with all agreements, documents, certificates

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or other instruments executed in connection therewith, the “Debt Documents”) up
to an aggregate principal amount equal to the Tranche B Term Commitments (as
defined in the Superpriority Credit Agreement) available to the Company on the
Tranche B Funding Date (as defined in the Superpriority Credit Agreement) (such
amount, the “Funding Amount”) plus the aggregate amount of the Letter of Credit
Issuer Commitments (as defined in the Superpriority Credit Agreement) available
to the Company on the Tranche B Funding Date (together with the Funding Amount,
the “Total Funding Amount”), and that such incurrence of New Indebtedness under
the Debt Documents may cause the Leverage Ratio as of the Effective Date to
exceed certain thresholds set forth in the Certificate of Designation; and

WHEREAS, the Company, along with certain of its subsidiaries, proposes to enter
into that certain Forbearance Agreement, dated as of the Effective Date, by and
among the Company, MTA, MTUS, the other guarantors and the holders party
thereto, attached hereto as Exhibit B (the “Forbearance Agreement”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, as of the date first set forth above (the
“Effective Date”), the parties hereto hereby agree as follows:

SECTION 1 Limited Consent and Waiver. In reliance on the representations,
warranties, covenants and agreements contained in this Agreement, the Holder,
waiving all notice, in lieu of a meeting, hereby, as of the Effective Date,
irrevocably:

(a) consents, solely for the purposes of Sections 4(b)(i) and 4(b)(vi) of the
Certificate of Designation, to (i) the Second COD Amendment (as defined below)
and (ii) the Company’s consummation of the Proposed Financing on the Tranche B
Funding Date, including the incurrence of the New Indebtedness up to the Total
Funding Amount on the Tranche B Funding Date, in each case, in accordance with
the terms and conditions set forth in the Superpriority Credit Agreement;
provided, for the avoidance of doubt, that notwithstanding anything contained in
this Agreement, the Superpriority Credit Agreement, the other Debt Documents or
any other Corporation Indebtedness Document, the amount of New Indebtedness
permitted to be incurred hereunder shall not exceed the Total Funding Amount;
and

(b) waives any rights it may have under, and any obligations of the Company with
respect to, Sections 4(b)(i) and 4(b)(vi) of the Certificate of Designation with
respect to the Second COD Amendment and the Proposed Financing, including,
without limitation, any impact of the incurrence of New Indebtedness up to the
Total Funding Amount on the Leverage Ratio (in each case, solely as to the
incurrence of New Indebtedness up to the Total Funding Amount), so long as the
Proposed Financing is consummated substantially in accordance with the terms and
conditions set forth in the Superpriority Credit Agreement, provided, for the
avoidance of doubt, that, any future calculation of the Leverage Ratio pursuant
to Section 4(b)(vi) of the Certificate of Designation (as amended by the Second
COD Amendment), other than with respect to the incurrence and issuance of
Excluded Debt (as defined in the Second COD Amendment), shall include the amount
of New Indebtedness outstanding at such time; provided, further, that, the
limited consent and waiver in this Section 1 is specific and limited to the
matters expressly stated herein and shall not constitute a waiver of any rights
or obligations in connection with any other transaction to which Sections
4(b)(i) or 4(b)(vi) of the Certificate of Designation (as amended by

 

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the Second COD Amendment) may be applicable, including, without limitation, any
additional incurrence of Indebtedness pursuant to the Proposed Financing in
excess of the Total Funding Amount. Nothing contained in this Section 1, nor any
past indulgence by the Holder, nor any other action or inaction on behalf of the
Holder, shall constitute or be deemed to constitute a consent to, or waiver of,
any other action or inaction of the Company or any of its subsidiaries which
constitutes (or would constitute) a violation of any provision of the
Certificate of Designation, or which results (or would result) in a breach under
the Certificate of Designation, nor shall this limited consent and waiver
constitute a course of conduct or dealing among the parties. The Holder shall
have no obligation to grant any future waivers, consents or amendments with
respect to the Certificate of Designation, and the parties hereto agree that the
limited consent and waiver provided herein shall constitute a one-time waiver
and shall not waive, affect or diminish any right of the Holder to hereafter
demand strict compliance with the Certificate of Designation.

SECTION 2 Covenants.

2.1 Document Amendments. The Company shall use commercially reasonable best
efforts to cause all counterparties to, as promptly as practicable, but in any
event no later than five (5) business days after the Effective Date, adopt the
second amendment to the Certificate of Designation in the form attached hereto
as Exhibit C (the “Second COD Amendment”), file the Second COD Amendment with
the Public Registry of the Republic of Panama and deliver evidence of such
filing to the Holder as soon as reasonably practicable after the filing thereof.

2.2 Fees and Expenses. As soon as practicable in connection with the occurrence
of the Tranche B Funding Date, but in any event no later than two (2) business
days after the Tranche B Funding Date, as part of a substantially
contemporaneous exchange for value, the Company shall pay the Holder or its
designees shall have received by wire transfer in immediately available funds to
the applicable accounts specified in Exhibit D hereto (or on applicable
invoices) payment for all Expenses of the Holder, and all amounts payable to the
Holder in connection with its Board Observer status under the Certificate of
Designation, in each case, incurred on or prior to the Effective Date (including
a good faith estimate of fees for the period through December 15, 2019) in
connection with the transactions set forth herein, for which invoices have been
presented prior to the Effective Date, including, but not limited to, the
reasonable and documented fees and expenses of Vinson & Elkins L.L.P., legal
counsel to the Holder and Morgan & Morgan, Panamanian counsel to the Holder.

SECTION 3 Representations and Warranties. In order to induce the Holder to enter
into this Agreement, the Company hereby represents and warrants to the Holder
that:

3.1 Due Authorization, No Conflicts. The execution, delivery and performance of
this Agreement and the Second COD Amendment by the Company are within the
Company’s corporate power, have been duly authorized by all necessary corporate
action (including adoption by the Board of Directors of the Company), require no
action by or in respect of, or filing (except for filings required to be made
under the Exchange Act and with the Public Registry of the Republic of Panama)
with, any governmental body, agency or official and do not violate or constitute
a default under any provision of applicable law or any Corporation Indebtedness
Document (including, without limitation, the Debt Documents).

 

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3.2 Validity and Binding Effect. This Agreement does, and the Certificate of
Designation (as amended by the Second COD Amendment), upon filing with the
Public Registry of the Republic of Panama, will constitute the valid and binding
obligations of the Company enforceable in accordance with their respective
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors’ rights generally, and the
availability of equitable remedies may be limited by equitable principles of
general application.

3.3 Accuracy of Documents. Each of the Superpriority Amendment attached hereto
as Exhibit A and the Forbearance Agreement attached hereto as Exhibit B is a
true, complete and correct copy of such document and reflects the entire
agreement of the parties thereto as of the Effective Date.

SECTION 4 Specific Performance. The Company hereby agrees that irreparable
damage would occur if any provision of this Agreement were not performed in
accordance with the terms hereof and that the Holder shall be entitled to
specific performance of the terms hereof, in addition to any other remedy to
which the Holder is entitled at law or in equity.

SECTION 5 Miscellaneous.

5.1 Parties in Interest. All of the terms and provisions of this Agreement shall
bind and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.

5.2 Fair Consideration. In negotiating this Agreement, each of the parties have
been represented by counsel and have entered into this Agreement in good faith.
The Company and the Holder each acknowledge and agree that they have received
fair consideration and reasonably equivalent value in connection with this
Agreement and the exchanges contemplated hereunder.

5.3 Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be an original and all of which, when taken together, shall
constitute one agreement. Delivery of an executed counterpart of a signature of
this Agreement by fax or other electronic transmission (e.g. “.pdf”) shall be
effective as delivery of a manually executed counterpart of this Agreement.

5.4 COMPLETE AGREEMENT. THIS AGREEMENT AND THE DOCUMENTS REFERENCED HEREIN
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES WITH RESPECT TO THE SUBJECT
MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES REGARDING THE SUBJECT MATTER HEREOF.

5.5 Headings. The headings, captions and arrangements used in this Agreement
are, unless specified otherwise, for convenience only and shall not be deemed to
limit, amplify or modify the terms of this Agreement, nor affect the meaning
thereof.

5.6 Review and Construction of Documents. Each party hereto hereby acknowledges,
and represents and warrants to the other parties, that (a) it has had the
opportunity to consult with legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel, (b) it
has reviewed this Agreement and fully understands the effects thereof and all
terms and provisions contained herein, (c) it has executed this Agreement of its
own free will and volition, and (d) this Agreement shall be construed as if
jointly drafted by the Company and the Holder. The recitals contained in this
Agreement shall be construed to be part of the operative terms and provisions of
this Agreement.

 

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5.7 Arms-Length/Good Faith. This Agreement has been negotiated at arms-length
and in good faith by the parties hereto.

5.8 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). EACH PARTY HERETO (a) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

5.9 Governing Law; Jurisdiction; Consent to Service of Process.

(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF RULE PROVISION OR
RULE (WHETHER THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE
THE APPLICATION OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK; PROVIDED
THAT, THE EFFECTIVENESS OF THE CONSENT AND WAIVER SET FORTH IN SECTION 1 SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE REPUBLIC OF
PANAMA WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF RULE PROVISION
OR RULE (WHETHER THE REPUBLIC OF PANAMA OR ANY OTHER JURISDICTION) THAT WOULD
CAUSE THE APPLICATION OF ANY JURISDICTION OTHER THAN THE REPUBLIC OF PANAMA.

(b) Each of the parties hereto hereby irrevocably and unconditionally
(i) submits, for itself and its property, to the exclusive jurisdiction of any
state or federal court of the United States of America, in each case sitting in
the Borough of Manhattan in New York, and the respective appellate courts
thereof, as to any suit, action or proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby, or for recognition or
enforcement of any judgment, and agrees that all claims in respect of any such
action or proceeding shall be heard and determined in such New York State court
or, to the extent permitted by law, in such Federal court, and further agrees to
not commence any such suit, action or proceeding other than in such New York
State court or, to the extent permitted by law, in such Federal court,
(ii) waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or the

 

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transactions contemplated hereby in any court in which such venue may be laid in
accordance with clause (i) of this sentence, (iii) waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court and (iv) agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Service of any process, summons, notice or document by
registered mail or overnight courier addressed to any of the parties hereto at
the addresses set forth above shall be effective service of process against such
party for any suit, action or proceeding brought in any such court.

*  *  *  *  *

 

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
undersigned on the date first written above.

 

COMPANY:

MCDERMOTT INTERNATIONAL, INC.,

a corporation incorporated and existing under the laws of the Republic of Panama

By:

 

/s/ John M. Freeman

Name: John M. Freeman

Title: Executive Vice President, Chief Legal Officer and Corporate Secretary

[Signature Page to Agreement]

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HOLDER:

WEST STREET CAPITAL PARTNERS VII OFFSHORE INVESTMENTS, L.P.,

by: Goldman Sachs & Co. LLC, its Attorney-In-Fact

By:

 

/s/ Chris Crampton

Name: Chris Crampton

Title: Managing Director

WEST STREET CAPITAL PARTNERS VII – PARALLEL B, L.P.

by: Goldman Sachs & Co. LLC, its Attorney-In-Fact

By:

 

/s/ Chris Crampton

Name: Chris Crampton

Title: Managing Director

WEST STREET CAPITAL PARTNERS VII B, L.P.

by: Goldman Sachs & Co. LLC, its Attorney-In-Fact

By:

 

/s/ Chris Crampton

Name: Chris Crampton

Title: Managing Director

APICORP MANAGED ACCOUNT INVESTMENT VEHICLE, L.P.

by: Goldman Sachs & Co. LLC, its Attorney-In-Fact

By:

 

/s/ Chris Crampton

Name: Chris Crampton

Title: Managing Director

[Signature Page to Agreement]

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EXHIBIT A

AMENDMENT NO. 1 TO SUPERPRIORITY CREDIT AGREEMENT

(See Exhibit 10.3 to McDermott International, Inc.’s Current Report on Form 8-K
Filed on December 2, 2019.)

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EXHIBIT B

FORBEARANCE AGREEMENT

(See Exhibit 10.4 to McDermott International, Inc.’s Current Report on Form 8-K
Filed on December 2, 2019.)

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EXHIBIT C

FORM OF SECOND COD AMENDMENT

(See attached.)

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CERTIFICATE OF AMENDMENT TO THE

CERTIFICATE OF DESIGNATION OF 12% REDEEMABLE PREFERRED STOCK

OF

MCDERMOTT INTERNATIONAL, INC.

MCDERMOTT INTERNATIONAL, INC., a corporation incorporated and existing under the
laws of the Republic of Panama (the “Corporation”), in accordance with the
provisions of Section III, Article 20 of Law 32 of February 26, 1927 on
Corporations of the Republic of Panama, does hereby certify:

That pursuant to the authority contained in Article Three of the Amended and
Restated Articles of Incorporation, as amended, of the Corporation, the Board of
Directors of the Corporation duly approved and adopted on October 20, 2019 the
following resolutions amending the Certificate of Designation of the 12%
Redeemable Preferred Stock as originally filed on October 30, 2018, as amended
by that certain Certificate of Amendment thereto, dated October 24, 2019, in
accordance with the provisions of the Corporation Law of Panama, Law 32 of
February 26, 1927, which resolutions remain in full force and effect on the date
hereof:

RESOLVED, that, capitalized terms not defined herein are defined in the
Certificate of Designation dated October 30, 2018, as amended by that certain
Certificate of Amendment thereto dated October 24, 2019 (such date, the “First
Amendment Date”).

FURTHER RESOLVED, that, pursuant to the authority vested in the Board of
Directors of McDermott International, Inc., a Panamanian corporation (the
“Corporation”), in accordance with the provisions of the Amended and Restated
Articles of Incorporation, as amended (the “Articles”), of the Corporation,
that, Section 4(b)(vi) of the Certificate of Designations is hereby amended and
restated in its entirety to read as follows:

(vi) the incurrence, creation, assumption or guarantee of any Indebtedness (as
defined in the Current Credit Agreement, as amended by the amendments thereto
entered into on October 21, 2019, without any further amendments, modifications
or supplements thereto, the “Amended Current Credit Agreement” and, in all cases
as used in this clause (vi) (excluding any Warrants (as defined in the
Superpriority Credit Agreement as in effect on October 21, 2019) issued pursuant
to Sections 7.18 and 7.19 of the Superpriority Credit Agreement classified as
liabilities) that would cause the Leverage Ratio as of the date on which such
Indebtedness is incurred, created, assumed or guaranteed to exceed (1) on or
after October 1, 2019 but prior to January 1, 2020, 4.44 to 1.00, (2) on or
after January 1, 2020 but prior to January 1, 2021, 4.17 to 1.00, (3) on or
after January 1, 2021 but prior to January 1, 2022, 3.89 to 1.00, (4) on or
after January 1, 2022, 3.61 to 1.00, in each case after giving pro forma effect
to such incurrence, creation, assumption or guarantee and the application of the
proceeds thereof; provided that, notwithstanding the foregoing, any incurrence,
creation, assumption or guarantee of any Indebtedness constituting (A) any
Revolving Borrowing (as defined in the Amended Current Credit Agreement) up to
the Revolving Commitment under the Amended Current Credit Agreement as of the
First Amendment Date, (B) any LC Facility Outstandings (as defined in the
Amended Current Credit Agreement) up to the LC Facility Commitment (as defined
in the Amended Current Credit Agreement) under the Amended

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Current Credit Agreement as of the First Amendment Date, (C) any Letter of
Credit Obligations (as defined in the LC Facility) up to the Commitment under
the Amended Current Credit Agreement as of the First Amendment Date and (D) (1)
any Revolving Outstandings (as defined in the Superpriority Credit Agreement as
in effect on October 21, 2019) up to an aggregate principal amount equal to the
Letter of Credit Issuer Commitment (as defined in the Superpriority Credit
Agreement as in effect on October 21, 2019) available to the Company on or prior
to the Tranche B Funding Date (as defined in the Superpriority Credit Agreement
as in effect on October 21, 2019) plus the aggregate amount of Letter of Credit
Issuer Obligations (as defined in the Superpriority Credit Agreement as in
effect on October 21, 2019) available to the Company on or prior to the Tranche
B Funding Date and (2) Tranche A Term Loans and Tranche B Term Loans (each, as
defined in the Superpriority Credit Agreement as in effect on October 21, 2019)
up to the Tranche A Term Commitment and the Tranche B Term Commitment (each, as
defined in the Superpriority Credit Agreement), respectively, available to the
Company on or prior to the Tranche B Funding Date (the items in the foregoing
clauses (A) through (D), “Excluded Debt”) shall not be subject to the
requirements of this Section 4(b)(vi), provided further, for the avoidance of
doubt, that, any future calculation of the Leverage Ratio pursuant to this
Section 4(b)(vi), other than with respect to the issuance and incurrence of
Excluded Debt, shall include the amount of Excluded Debt outstanding at such
time.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the Corporation has caused this Second Certificate of
Amendment to Certificate of Designation to be executed in its corporate name
this ___ day of [●] 2019.

 

MCDERMOTT INTERNATIONAL, INC.

By:

 

                 

Name:

 

 

Title: