SUCH RIG, FREE AND CLEAR OF ANY LIENS OTHER THAN THE PERMITTED LIENS;
AND (E) AFTER GIVING EFFECT TO THE REQUESTED ADVANCE, THE AGGREGATE AMOUNT
OUTSTANDING ON THE LOAN SHALL NOT EXCEED ONE HUNDRED PERCENT (100%) OF THE NET
OLV OF THE OPERATING RIG COLLATERAL, PLUS ONE HUNDRED PERCENT (100%) OF THE NET
OLV OF ANCILLARY SUPPORT EQUIPMENT PURCHASED IN THE UNITED STATES, PLUS THE FACE
AMOUNT OF THE LETTER OF CREDIT (I.E., $19,000,000).
(B)
OTHER OPERATING RIGS.
LENDERS' OBLIGATION TO MAKE ANY LOAN
ADVANCE AFTER ADVANCES AGAINST THE FIRST THREE OPERATING RIGS IS IN EACH CASE
SUBJECT TO THE PRIOR FULFILLMENT OR WAIVER BY ADMINISTRATIVE AGENT AND MAJORITY
LENDERS OF EACH OF THE FOLLOWING CONDITIONS:
(A) ADMINISTRATIVE AGENT SHALL
HAVE RECEIVED A WRITTEN REQUEST FROM BORROWER THAT AN ADVANCE BE FUNDED IN
ACCORDANCE WITH THE TERMS HEREOF, TOGETHER WITH A WRITTEN DIRECTION FROM
BORROWER AS TO THE METHOD OF PAYMENT AND PAYEE(S) OF THE PROCEEDS OF SUCH
ADVANCE, WHICH REQUEST AND DIRECTION SHALL HAVE BEEN RECEIVED BY ADMINISTRATIVE
AGENT NOT LESS THAN THREE (3) BUSINESS DAYS PRIOR TO ANY REQUESTED FUNDING DATE
AND SHALL IDENTIFY THE RIGS INCLUDED IN ESTABLISHING THE NET OLV OF THE
OPERATING RIG COLLATERAL; (B) THE COMMITMENT EXPIRATION DATE SHALL NOT THEN HAVE
OCCURRED; (C) EACH OF THE GENERAL FUNDING CONDITIONS AS MAY BE APPLICABLE SHALL
THEN HAVE BEEN MET OR SATISFIED TO THE REASONABLE SATISFACTION OF ADMINISTRATIVE
AGENT; AND (D) WITH RESPECT TO EACH OPERATING RIG IN RESPECT OF WHICH AN ADVANCE
IS REQUESTED (I) SUCH RIG SHALL NOT HAVE BEEN COVERED BY ANY ADVANCE UNDER
SECTION 2.6 OR SECTION 2.7(A), (II) THE AMOUNT OF THE ADVANCE SHALL NOT EXCEED
SEVENTY FIVE PERCENT (75%) OF THE NET OLV OF SUCH OPERATING RIG, (III) SUCH RIG
SHALL BE AN OPERATING RIG, AND (IV) ADMINISTRATIVE AGENT SHALL HAVE RECEIVED
SUCH APPRAISALS OR RE-APPRAISALS OF THE COLLATERAL FROM VALUATION SOURCES
REASONABLY ACCEPTABLE TO IT AS IT MAY REQUIRE AND SHALL HAVE RECEIVED EVIDENCE
REASONABLY SATISFACTORY TO IT THAT BORROWER OWNS, OR AFTER GIVING EFFECT TO THE
APPLICATION OF THE PROCEEDS OF THE REQUESTED ADVANCE, WILL OWN SUCH RIG, FREE
AND CLEAR OF ANY LIENS OTHER THAN THE PERMITTED LIENS.
SECTION 2.8
USE OF LOAN PROCEEDS.
THE PROCEEDS OF THE LOAN SHALL BE
USED BY BORROWER SOLELY FOR A LOAN PURPOSE, OR, WITH THE PRIOR WRITTEN CONSENT
OF ADMINISTRATIVE AGENT AND MAJORITY LENDERS, WHICH CONSENT SHALL NOT BE
UNREASONABLY WITHHELD, CONDITIONED OR DELAYED, FOR OTHER LAWFUL BUSINESS
PURPOSES OF BORROWER NOT PROHIBITED HEREBY. BORROWER AGREES THAT UNDER NO
CIRCUMSTANCES WILL THE PROCEEDS OF THE LOAN BE USED: (A) FOR PERSONAL, FAMILY OR
HOUSEHOLD PURPOSES OF ANY PERSON WHATSOEVER, OR (B) TO PURCHASE, CARRY OR TRADE
IN SECURITIES, OR
18
REPAY DEBT INCURRED TO PURCHASE, CARRY OR TRADE IN SECURITIES, OR (C) TO PAY ANY
AMOUNT TO MERRILL LYNCH AND CO., INC. OR ANY OF ITS SUBSIDIARIES, OTHER THAN
MERRILL LYNCH BANK USA, MERRILL LYNCH BANK & TRUST CO. OR ANY SUBSIDIARY OF
EITHER OF THEM (INCLUDING ADMINISTRATIVE