Document:

2018.07.13_RIG_Exhibit 4.1_Gordian Closing

		
			Exhibit 4.1
		

		
			Execution Version
		

		

		
			TRANSOCEAN GUARDIAN LIMITED,
		

		
			as Issuer,
		

		
			EACH OF THE GUARANTORS PARTY HERETO
		

		
			and
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION,
		

		
			as Trustee and as Collateral Agent
		

		

		
			INDENTURE
		

		
			Dated as of July 13, 2018
		

		

		
			5.875% Senior Secured Notes due 2024
		

		

		
			 
		

		
			 
		

		
			

		 

 

		

			 

		

		

		
			Table of Contents
		

			
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						Page

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 1

				
	
					
						Definitions and Incorporation by Reference

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 1.01.

					
					
						    

					
					
						Definitions.

					
					
						    

					
1
				
	
					
						SECTION 1.02.

					
					
						 

					
					
						Other Definitions

					
					
						 

					
22
				
	
					
						SECTION 1.03.

					
					
						 

					
					
						Rules of Construction

					
					
						 

					
23
				
	
					
						SECTION 1.04.

					
					
						 

					
					
						Agent for Service; Submission to Jurisdiction; Waiver of Immunities

					
					
						 

					
24
				
	
					
						SECTION 1.05.

					
					
						 

					
					
						Currency

					
					
						 

					
24
				
	
					
						SECTION 1.06.

					
					
						 

					
					
						No Incorporation by Reference of Trust Indenture Act

					
					
						 

					
24
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 2

				
	
					
						The Securities

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 2.01.

					
					
						 

					
					
						Form and Dating

					
					
						 

					
24
				
	
					
						SECTION 2.02.

					
					
						 

					
					
						Execution and Authentication

					
					
						 

					
25
				
	
					
						SECTION 2.03.

					
					
						 

					
					
						Registrar and Paying Agent

					
					
						 

					
25
				
	
					
						SECTION 2.04.

					
					
						 

					
					
						Paying Agent To Hold Money in Trust

					
					
						 

					
25
				
	
					
						SECTION 2.05.

					
					
						 

					
					
						Lists of Holders of Securities

					
					
						 

					
26
				
	
					
						SECTION 2.06.

					
					
						 

					
					
						Transfer and Exchange

					
					
						 

					
26
				
	
					
						SECTION 2.07.

					
					
						 

					
					
						Replacement Securities

					
					
						 

					
26
				
	
					
						SECTION 2.08.

					
					
						 

					
					
						Outstanding Securities

					
					
						 

					
26
				
	
					
						SECTION 2.09.

					
					
						 

					
					
						Temporary Securities

					
					
						 

					
27
				
	
					
						SECTION 2.10.

					
					
						 

					
					
						Cancellation

					
					
						 

					
27
				
	
					
						SECTION 2.11.

					
					
						 

					
					
						Defaulted Interest

					
					
						 

					
27
				
	
					
						SECTION 2.12.

					
					
						 

					
					
						CUSIP Numbers, ISINs, etc

					
					
						 

					
27
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 3

				
	
					
						Redemption

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 3.01.

					
					
						 

					
					
						Notices to Trustee

					
					
						 

					
27
				
	
					
						SECTION 3.02.

					
					
						 

					
					
						Selection of Securities to Be Redeemed

					
					
						 

					
28
				
	
					
						SECTION 3.03.

					
					
						 

					
					
						Notice of Redemption

					
					
						 

					
28
				
	
					
						SECTION 3.04.

					
					
						 

					
					
						Effect of Notice of Redemption

					
					
						 

					
29
				
	
					
						SECTION 3.05.

					
					
						 

					
					
						Deposit of Redemption Price

					
					
						 

					
29
				
	
					
						SECTION 3.06.

					
					
						 

					
					
						Securities Redeemed in Part

					
					
						 

					
29
				
	
					
						SECTION 3.07.

					
					
						 

					
					
						Open Market Repurchase

					
					
						 

					
29
				
	
					
						SECTION 3.08.

					
					
						 

					
					
						Optional Redemption

					
					
						 

					
29
				
	
					
						SECTION 3.09.

					
					
						 

					
					
						Mandatory Redemption

					
					
						 

					
30
				

		
			
		

		

		 

		

			i

		

 

		

			 

		

	
					
						

					
						SECTION 3.10.

					
					
						    

					
					
						Tax Redemption

					
					
						    

					
31
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 4

				
	
					
						Covenants

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 4.01.

					
					
						 

					
					
						Payment of Securities

					
					
						 

					
31
				
	
					
						SECTION 4.02.

					
					
						 

					
					
						Change of Control Repurchase Event

					
					
						 

					
31
				
	
					
						SECTION 4.03.

					
					
						 

					
					
						Corporate Existence

					
					
						 

					
34
				
	
					
						SECTION 4.04.

					
					
						 

					
					
						Limitation on Liens

					
					
						 

					
34
				
	
					
						SECTION 4.05.

					
					
						 

					
					
						Limitation on Indebtedness

					
					
						 

					
35
				
	
					
						SECTION 4.06.

					
					
						 

					
					
						Limitation on Subsidiary Indebtedness

					
					
						 

					
36
				
	
					
						SECTION 4.07.

					
					
						 

					
					
						Limitation on Sale and Lease Back Transactions

					
					
						 

					
38
				
	
					
						SECTION 4.08.

					
					
						 

					
					
						Maintenance of Property; Insurance

					
					
						 

					
38
				
	
					
						SECTION 4.09.

					
					
						 

					
					
						Financial Reports and Other Information

					
					
						 

					
40
				
	
					
						SECTION 4.10.

					
					
						 

					
					
						Trustee Inspection Rights

					
					
						 

					
42
				
	
					
						SECTION 4.11.

					
					
						 

					
					
						Conduct of Business

					
					
						 

					
43
				
	
					
						SECTION 4.12.

					
					
						 

					
					
						Use of Proceeds; Margin Regulations; Company Activities

					
					
						 

					
43
				
	
					
						SECTION 4.13.

					
					
						 

					
					
						Restrictions on Fundamental Changes

					
					
						 

					
44
				
	
					
						SECTION 4.14.

					
					
						 

					
					
						Collateral Rig Leverage Ratio

					
					
						 

					
46
				
	
					
						SECTION 4.15.

					
					
						 

					
					
						Total Leverage Ratio

					
					
						 

					
46
				
	
					
						SECTION 4.16.

					
					
						 

					
					
						[Reserved] 

					
					
						 

					
47
				
	
					
						SECTION 4.17.

					
					
						 

					
					
						Collateral Rig Classifications; Operation of Collateral Rig; Registry, Name and Flag

					
					
						 

					
48
				
	
					
						SECTION 4.18.

					
					
						 

					
					
						Deposit of Earnings

					
					
						 

					
49
				
	
					
						SECTION 4.19.

					
					
						 

					
					
						Debt Service Reserve

					
					
						 

					
49
				
	
					
						SECTION 4.20.

					
					
						 

					
					
						Limitation on Dividends

					
					
						 

					
49
				
	
					
						SECTION 4.21.

					
					
						 

					
					
						Intercompany Loans

					
					
						 

					
50
				
	
					
						SECTION 4.22.

					
					
						 

					
					
						Maintenance of Accounts

					
					
						 

					
50
				
	
					
						SECTION 4.23.

					
					
						 

					
					
						Performance under Contracts; Non-Interference

					
					
						 

					
50
				
	
					
						SECTION 4.24.

					
					
						 

					
					
						Taxes

					
					
						 

					
50
				
	
					
						SECTION 4.25.

					
					
						 

					
					
						Compliance with Laws; Policies and Procedures

					
					
						 

					
50
				
	
					
						SECTION 4.26.

					
					
						 

					
					
						Limitation on Modifications of Certain Documents

					
					
						 

					
51
				
	
					
						SECTION 4.27.

					
					
						 

					
					
						Further Assurances

					
					
						 

					
52
				
	
					
						SECTION 4.28.

					
					
						 

					
					
						Master Services Agreement

					
					
						 

					
53
				
	
					
						SECTION 4.29.

					
					
						 

					
					
						Transfer of Collateral Rig; Transfer of Drilling Contract

					
					
						 

					
53
				
	
					
						SECTION 4.30.

					
					
						 

					
					
						Post-Bankruptcy Restrictions. 

					
					
						 

					
54
				
	
					
						SECTION 4.31.

					
					
						 

					
					
						Waiver of Certain Covenants

					
					
						 

					
54
				

		
			
		

		

		 

		

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						Article 5

				
	
					
						Successor Company

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 5.01.

					
					
						    

					
					
						Consolidation, Merger and Sale of Assets

					
					
						    

					
55
				
	
					
						SECTION 5.02.

					
					
						 

					
					
						Successor Company Substituted

					
					
						 

					
55
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 6

				
	
					
						Defaults and Remedies

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 6.01.

					
					
						 

					
					
						Events of Default

					
					
						 

					
55
				
	
					
						SECTION 6.02.

					
					
						 

					
					
						Acceleration of Maturity; Rescission and Annulment

					
					
						 

					
57
				
	
					
						SECTION 6.03.

					
					
						 

					
					
						Collection of Indebtedness and Suits for Enforcement by Trustee

					
					
						 

					
59
				
	
					
						SECTION 6.04.

					
					
						 

					
					
						Trustee May File Proofs of Claim

					
					
						 

					
59
				
	
					
						SECTION 6.05.

					
					
						 

					
					
						Trustee May Enforce Claims Without Possession of Securities

					
					
						 

					
60
				
	
					
						SECTION 6.06.

					
					
						 

					
					
						Application of Money Collected

					
					
						 

					
60
				
	
					
						SECTION 6.07.

					
					
						 

					
					
						Limitation on Suits

					
					
						 

					
60
				
	
					
						SECTION 6.08.

					
					
						 

					
					
						Unconditional Contractual Right of Holders to Receive Principal, Premium and Interest

					
					
						 

					
61
				
	
					
						SECTION 6.09.

					
					
						 

					
					
						Restoration of Rights and Remedies

					
					
						 

					
61
				
	
					
						SECTION 6.10.

					
					
						 

					
					
						Rights and Remedies Cumulative

					
					
						 

					
61
				
	
					
						SECTION 6.11.

					
					
						 

					
					
						Delay or Omission Not Waiver

					
					
						 

					
62
				
	
					
						SECTION 6.12.

					
					
						 

					
					
						Control by Holders

					
					
						 

					
62
				
	
					
						SECTION 6.13.

					
					
						 

					
					
						Waiver of Past Defaults

					
					
						 

					
62
				
	
					
						SECTION 6.14.

					
					
						 

					
					
						Undertaking for Costs

					
					
						 

					
63
				
	
					
						SECTION 6.15.

					
					
						 

					
					
						Waiver of Stay or Extension Laws

					
					
						 

					
63
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 7

				
	
					
						Trustee

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 7.01.

					
					
						 

					
					
						Duties of Trustee

					
					
						 

					
63
				
	
					
						SECTION 7.02.

					
					
						 

					
					
						Rights of Trustee

					
					
						 

					
64
				
	
					
						SECTION 7.03.

					
					
						 

					
					
						Individual Rights of Trustee

					
					
						 

					
66
				
	
					
						SECTION 7.04.

					
					
						 

					
					
						Trustee’s Disclaimer

					
					
						 

					
66
				
	
					
						SECTION 7.05.

					
					
						 

					
					
						Notice of Defaults

					
					
						 

					
66
				
	
					
						SECTION 7.06.

					
					
						 

					
					
						Compensation and Indemnity

					
					
						 

					
66
				
	
					
						SECTION 7.07.

					
					
						 

					
					
						Replacement of Trustee

					
					
						 

					
67
				
	
					
						SECTION 7.08.

					
					
						 

					
					
						Successor Trustee by Merger

					
					
						 

					
67
				
	
					
						SECTION 7.09.

					
					
						 

					
					
						Corporate Trustee Required; Eligibility

					
					
						 

					
68
				
	
					
						SECTION 7.10.

					
					
						 

					
					
						Debt Service Reserve Account

					
					
						 

					
68
				

		
			 
		

		
			
		

		

		 

		

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						Article 8

				
	
					
						Defeasance and Covenant Defeasance

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 8.01.

					
					
						    

					
					
						Option to Effect Defeasance or Covenant Defeasance

					
					
						    

					
69
				
	
					
						SECTION 8.02.

					
					
						 

					
					
						Defeasance

					
					
						 

					
69
				
	
					
						SECTION 8.03.

					
					
						 

					
					
						Covenant Defeasance

					
					
						 

					
69
				
	
					
						SECTION 8.04.

					
					
						 

					
					
						Conditions to Defeasance or Covenant Defeasance

					
					
						 

					
70
				
	
					
						SECTION 8.05.

					
					
						 

					
					
						Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions

					
					
						 

					
71
				
	
					
						SECTION 8.06.

					
					
						 

					
					
						Reinstatement

					
					
						 

					
71
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 9

				
	
					
						Satisfaction and Discharge

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 9.01.

					
					
						 

					
					
						Satisfaction and Discharge of Indenture

					
					
						 

					
72
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 10

				
	
					
						Amendment, Supplement and Waiver

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 10.01.

					
					
						 

					
					
						Without Consent of Holders

					
					
						 

					
73
				
	
					
						SECTION 10.02.

					
					
						 

					
					
						With Consent of Holders

					
					
						 

					
74
				
	
					
						SECTION 10.03.

					
					
						 

					
					
						Execution of Supplemental Indentures

					
					
						 

					
75
				
	
					
						SECTION 10.04.

					
					
						 

					
					
						Effect of Supplemental Indentures

					
					
						 

					
76
				
	
					
						SECTION 10.05.

					
					
						 

					
					
						Reference in Securities to Supplemental Indentures

					
					
						 

					
76
				
	
					
						SECTION 10.06.

					
					
						 

					
					
						Notice of Supplemental Indentures

					
					
						 

					
76
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 11

				
	
					
						Guarantees

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 11.01.

					
					
						 

					
					
						Guarantees

					
					
						 

					
76
				
	
					
						SECTION 11.02.

					
					
						 

					
					
						Limitation on Liability

					
					
						 

					
77
				
	
					
						SECTION 11.03.

					
					
						 

					
					
						Successors and Assigns

					
					
						 

					
77
				
	
					
						SECTION 11.04.

					
					
						 

					
					
						No Waiver

					
					
						 

					
78
				
	
					
						SECTION 11.05.

					
					
						 

					
					
						Modification

					
					
						 

					
78
				
	
					
						SECTION 11.06.

					
					
						 

					
					
						Release of Certain Guarantors

					
					
						 

					
78
				
	
					
						SECTION 11.07.

					
					
						 

					
					
						Execution and Delivery

					
					
						 

					
78
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 12

				
	
					
						Security

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 12.01.

					
					
						 

					
					
						Security Documents; Additional Collateral

					
					
						 

					
78
				
	
					
						SECTION 12.02.

					
					
						 

					
					
						Releases of Collateral

					
					
						 

					
79
				
	
					
						SECTION 12.03.

					
					
						 

					
					
						Release Documentation

					
					
						 

					
79
				

		
			 
		

		
			
		

		

		 

		

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						SECTION 12.04.

					
					
						    

					
					
						Possession and Use of Collateral; No Impairment of the Security Interests

					
					
						     

					
79
				
	
					
						SECTION 12.05.

					
					
						 

					
					
						Collateral Agent

					
					
						 

					
80
				
	
					
						SECTION 12.06.

					
					
						 

					
					
						Replacement of Collateral Agent

					
					
						 

					
81
				
	
					
						SECTION 12.07.

					
					
						 

					
					
						Purchaser Protected

					
					
						 

					
82
				
	
					
						SECTION 12.08.

					
					
						 

					
					
						Authorization of Receipt of Funds by the Trustee Under the Security Documents

					
					
						 

					
82
				
	
					
						SECTION 12.09.

					
					
						 

					
					
						Powers Exercisable by Receiver or Trustee

					
					
						 

					
82
				
	
					
						SECTION 12.10.

					
					
						 

					
					
						Compensation and Indemnification

					
					
						 

					
82
				
	
					
						SECTION 12.11.

					
					
						 

					
					
						Form of Security Documents and Opinions

					
					
						 

					
82
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 13

				
	
					
						Additional Amounts

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 13.01.

					
					
						 

					
					
						Payment of Additional Amounts

					
					
						 

					
83
				
	
					
						SECTION 13.02.

					
					
						 

					
					
						Swiss Minimum Interest

					
					
						 

					
84
				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Article 14

				
	
					
						Miscellaneous

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SECTION 14.01.

					
					
						 

					
					
						Notices

					
					
						 

					
85
				
	
					
						SECTION 14.02.

					
					
						 

					
					
						Certificate and Opinion as to Conditions Precedent

					
					
						 

					
86
				
	
					
						SECTION 14.03.

					
					
						 

					
					
						Statements Required in Certificate or Opinion

					
					
						 

					
86
				
	
					
						SECTION 14.04.

					
					
						 

					
					
						Rules by Trustee, Paying Agent and Registrar

					
					
						 

					
86
				
	
					
						SECTION 14.05.

					
					
						 

					
					
						Legal Holidays

					
					
						 

					
87
				
	
					
						SECTION 14.06.

					
					
						 

					
					
						Governing Law

					
					
						 

					
87
				
	
					
						SECTION 14.07.

					
					
						 

					
					
						No Recourse Against Others

					
					
						 

					
87
				
	
					
						SECTION 14.08.

					
					
						 

					
					
						Successors

					
					
						 

					
87
				
	
					
						SECTION 14.09.

					
					
						 

					
					
						Multiple Originals

					
					
						 

					
87
				
	
					
						SECTION 14.10.

					
					
						 

					
					
						Table of Contents: Headings

					
					
						 

					
87
				
	
					
						SECTION 14.11.

					
					
						 

					
					
						Waiver of Jury Trial

					
					
						 

					
87
				
	
					
						SECTION 14.12.

					
					
						 

					
					
						U.S.A. Patriot Act

					
					
						 

					
87
				

		
			 
		

		
			 
		

		
			

		 

		

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			APPENDICES
		

		
			Appendix A – Provisions Relating to Securities
		

		
			Exhibit 1.1 to Appendix A – Form of Security
		

		
			Appendix B – Form of Certificate of Transfer
		

		
			Appendix C – Form of Certificate of Exchange
		

		
			Appendix D – Form of Supplemental Indenture
		

		
			Appendix E -1 – Form of Norwegian Share Pledge Agreement
		

		
			Appendix E -2 – Form of Cayman Share Pledge Agreement
		

		
			Appendix F – Form of Assignment of Earnings
		

		
			Appendix G – Form of Assignment of Insurances
		

		
			Appendix H – Form of Collateral Rig Mortgage
		

		
			Appendix I – Form of Assignment of Bareboat Charter
		

		
			Appendix J-1 – Form of Receivables Pledge Agreement
		

		
			Appendix J-2 – Form of Bareboat Account Pledge Agreement
		

		
			Appendix K – Form of Deed of Quiet Enjoyment
		

		
			Appendix L – Form of DSRA Withdrawal Certificate
		

		
			Appendix M – Form of Account Pledge Agreement
		

		
			Appendix N – Form of Security Procedures Certificate
		

		
			Appendix O – Form of Blocked Period Withdrawal Certificate
		

		
			ANNEXES
		

		
			Annex I – Representations and Warranties of the Collateral Rig Owners and Collateral Rig Operator
		

		
			 
		

		
			 
		

		
			

		 

		

			i

		

 

		

			 

		

		

		
			INDENTURE dated as of July 13, 2018, among Transocean Guardian Limited, a Cayman Islands exempted company (the “Company”), the Guarantors (as defined herein), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as trustee (the “Trustee”) and as Collateral Agent.
		

		
			RECITALS
		

		
			The Company has duly authorized the issuance of $750,000,000 aggregate principal amount of 5.875% Senior Secured Notes due 2024, and to provide therefor the Company has duly authorized the execution and delivery of this Indenture.
		

		
			All things necessary to make the Securities (as defined below), when executed by the Company, authenticated and delivered hereunder and duly issued by the Company, the valid and binding obligations of the Company, and to make this Indenture a valid and legally binding agreement of the Company and the Guarantors, in accordance with its terms, have been done.
		

		
			NOW, THEREFORE, THIS INDENTURE WITNESSETH:
		

		
			For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the benefit of each other and the equal and proportionate benefit of all Holders of the Securities, as follows:
		

		
			Article 1
		

		
			Definitions and Incorporation by Reference
		

		
			SECTION 1.01. Definitions.
		

		
			“2023 Notes Indenture” means the Indenture dated as of July 21, 2016, by and among TINC, the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee, with all supplemental indentures, amendments and modifications thereto, and all notes issued pursuant to the provisions thereof.
		

		
			“2026 Notes Indenture” means the Indenture dated as of October 17, 2017, by and among TINC, the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee, with all supplemental indentures, amendments and modifications thereto, and all notes issued pursuant to the provisions thereof.
		

		
			“Acceptable Classification Society” shall mean DNV GL, Lloyds Register, American Bureau of Shipping (ABS) and Bureau Veritas or such other first class vessel classification society that is a member of the International Association of Classification Societies.
		

		
			“Acceptable Drilling Contract” means a drilling contract: (i) with as favorable or more favorable terms with respect to the Collateral Rig Operator than the Drilling Contract it replaces, including without limitation, (A) equal or higher dayrates, early termination fees and any other amounts payable to the Collateral Rig Operator under the Drilling Contract it replaces, (B) equal or lower operating costs (unless higher operating costs are offset by higher dayrates), (C) equal or longer tenor than the Drilling Contract it replaces, (D) timing of payments and (E) termination provisions; (ii) with a counterparty, the ultimate parent of which has a long term debt credit rating from Moody’s or S&P substantially equal to or better than Equinor ASA at the time of such replacement; and (iii) that maintains or increases the cash flow that would be received by the Collateral Rig Operator under the Drilling Contract it replaces.
		

		
			
		

		
			

		 

		

			1

		

 

		

			 

		

		

		
			“Acceptable Flag Jurisdiction” means Norway, the Republic of the Marshall Islands, the Republic of Liberia, the Republic of Vanuatu, the Bahamas, Panama, Malta, Denmark and Switzerland.
		

		
			“Acceptable Rig” means any offshore drilling rig owned by the Company or any other wholly-owned Subsidiary of Holdings and which TINC intends to become a Collateral Rig pursuant to a Collateral Rig Substitution; provided that (i) such replacement rig has an equal or greater fair market value (which shall be determined based on an Appraisal delivered to the Trustee from an Approved Appraiser dated not more than 60 days prior to the date of such replacement) than the Collateral Rig it replaces on such replacement date, (ii) such rig must constitute a semi-submersible drilling rig of substantially the same type, age (or newer than) and technical specifications as the Collateral Rig it replaces, (iii) such rig must have a class certificate from an Acceptable Classification Society substantially similar to the class certificate of the Collateral Rig such rig is replacing, (iv) such rig must be registered and flagged in an Acceptable Flag Jurisdiction and (v) such rig shall be acceptable to the counterparty under the Drilling Contract applicable to the rig being replaced.
		

		
			“Account and Receivables Pledge Agreement” means each account and receivables pledge agreement, account pledge agreement and intercompany receivables pledge agreement pursuant to which a Collateral Rig Owner grants a security interest to the Collateral Agent in the applicable Bareboat Account and/or all intercompany receivables owing to such Collateral Rig Owner, in the case of intercompany receivables, in substantially the form of Appendix J-1 hereto, and in the case of Bareboat Accounts, in substantially the form of Appendix J-2 hereto, in each case with such changes to such forms as are necessary or advisable to account for local law requirements or the granting of security interests in both intercompany receivables and Bareboat Accounts in the same document.
		

		
			“Account Pledge Agreement” means each account pledge agreement pursuant to which the Collateral Rig Operator grants a security interest to the Collateral Agent in the Earnings Account,  in each case in substantially the form of Appendix M hereto with such changes to such form as are necessary or advisable to account for local law requirements.
		

		
			“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person.
		

		
			“Aggregate Debt” means the sum of the following as of the date of determination: (1) the then outstanding aggregate principal amount of the Indebtedness of TINC and its Subsidiaries secured by liens not permitted by clauses (1) through (10) of Section 4.04(c); (2) the then outstanding aggregate principal amount of all Indebtedness of the Subsidiaries of TINC not permitted by clauses (1) through (11) or (13) of Section 4.06(a) without double counting in this clause (2) to the extent that such Indebtedness is included in clause (1) or (3) of this definition; and (3) the then existing Attributable Liens of TINC and its Subsidiaries in respect of sale and lease-back transactions without double counting to the extent that the Indebtedness relating thereto is included in clause (1) or (2) of this definition.
		

		
			“Anti-Corruption Laws” means all laws, rules and regulations of any jurisdiction applicable to Holdings, the Company and other Note Parties from time to time concerning or relating to bribery, money laundering, or corruption, including, without limitation, the United States Foreign Corrupt Practices Act of 1977, as amended from time to time, and the United Kingdom’s Bribery Act 2010, as amended from time to time.
		

		
			“Applicable Procedures” means, with respect to any transfer, redemption or exchange of or for beneficial interests in any Global Security, the rules and procedures of the Depositary that apply to such transfer, redemption or exchange.
		

		
			
		

		
			

		 

		

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			“Appraisal” means, with respect to a Collateral Rig or prospective Collateral Rig, a written appraisal report by an Approved Appraiser of the fair market value of such Collateral Rig or prospective Collateral Rig on the basis of a charter-free arm’s length transaction between any able buyer and seller not under duress.
		

		
			“Approved Appraiser” means IHS Inc., H. Clarksons & Company Limited, Fearnleys Ltd., or such other independent appraisal firm that is generally accepted as a provider of offshore rig brokering and advisory services to the global drilling industry, as certified to the Trustee in an Officers’ Certificate.
		

		
			“Attributable Liens” means in connection with a sale and lease-back transaction the lesser of: (1) the fair market value of the assets subject to such transaction, as determined in good faith by the board of directors of Holdings; and (2) the present value (discounted at the rate of interest implicit in such transaction) of the obligations of the lessee for rental payments during the shorter of the term of the related lease or the period through the first date on which the lessee may terminate the lease or, if such sale and lease-back transaction results in a Capital Lease, the outstanding amount of such Capital Lease as determined in accordance with GAAP.
		

		
			“Bankruptcy Law” means Title 11 of the United States Code or any similar federal, state or foreign law for the relief of debtors.
		

		
			“Bareboat Account” means the deposit account or accounts of each Collateral Rig Owner designated as such from time to time by such Collateral Rig Owner in the applicable Account and Receivables Pledge Agreement into which all earnings, hires, freights, income and other sums payable to such Collateral Rig Owner in respect of the applicable Collateral Rig under the applicable Bareboat Charter or otherwise derived from the applicable Bareboat Charter, are deposited.
		

		
			“Bareboat Charter” means each bareboat charterparty between the Collateral Rig Operator and a Collateral Rig Owner entered into from time to time, which shall provide that the rights of the Collateral Rig Operator in and to the applicable Collateral Rig and the other Collateral shall be subordinated to the Lien of the Collateral Agent for the benefit of the Secured Creditors.
		

		
			“Business Day” means each day which is not a Legal Holiday.
		

		
			“Capital Lease” means any lease obligation of a Person incurred with respect to real property or equipment acquired or leased by such Person and used in its business that is required to be recorded as a capital lease in accordance with GAAP.
		

		
			“Change of Control” means the occurrence of any of the following:
		

		
			(1)         the sale, lease, transfer, conveyance or other disposition (other than by way of merger, amalgamation or scheme of arrangement qualifying as an amalgamation or consolidation), in one or a series of related transactions (determined on a consolidated basis), of all or substantially all of the assets of TINC and its Subsidiaries taken as a whole to any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) other than to Holdings or one of its Subsidiaries;
		

		
			(2)         the consummation of any transaction (including, without limitation, any merger, amalgamation or scheme of arrangement qualifying as an amalgamation or consolidation) the result of which is that any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the combined voting power of TINC’s
		

		
			
		

		
			

		 

		

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			Voting Stock or other Voting Stock into which TINC’s Voting Stock is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares;
		

		
			(3)         TINC consolidates, amalgamates, or enters into a scheme of arrangement with, or merges with or into, any “person” (as that term is used in Section 13(d)(3) of the Exchange Act), or any person consolidates, amalgamates, or enters into a statutory plan of arrangement with, or merges with or into, TINC, in any such event pursuant to a transaction in which any outstanding Voting Stock of TINC is converted into or exchanged for cash, securities or other property, other than any such transaction where the shares of TINC’s Voting Stock outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, Voting Stock representing more than 50% of the combined voting power of the surviving person, including, for the avoidance of doubt, any parent company of such surviving person, immediately after giving effect to such transaction; or
		

		
			(4)         the adoption of a plan relating to TINC’s liquidation or dissolution.
		

		
			Notwithstanding the foregoing and for the avoidance of doubt, (i) any holding company whose principal asset is capital stock of TINC or any of TINC’s direct or indirect parent companies shall not itself be considered a “person” or “group” for purposes of clauses (2) or (3) above; (ii) the sale, lease, transfer, conveyance or other disposition of assets solely between or among Holdings and its Subsidiaries in accordance with the terms of the Indenture shall not constitute a Change of Control; (iii) the term “Change of Control” shall not include the consummation of any transaction (including, without limitation, any merger, amalgamation or statutory scheme of arrangement or consolidation or the sale, lease, transfer, conveyance or other disposition of all or substantially all of the Company’s assets) for the purpose of reincorporating or redomesticating or reorganizing TINC or Holdings in another jurisdiction and/or for the purpose of forming or collapsing a holding company structure; and (iv) a transaction in which TINC or any direct or indirect parent of TINC becomes a Subsidiary of another Person (other than a Person that is an individual, such Person that is not an individual, the “New Parent”) shall not constitute a Change of Control if the shareholders of TINC or such parent immediately prior to such transaction “beneficially own” (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, Voting Stock representing more than 50% of the combined voting power of the New Parent immediately after giving effect to such transaction.
		

		
			“Change of Control Payment” means, with respect to Securities tendered pursuant to a Change of Control Offer, an amount equal to 101% of the aggregate principal amount of the Securities repurchased plus accrued and unpaid interest thereon, if any, to, but not including the date of repurchase.
		

		
			“Change of Control Repurchase Event” means on any date during the 60-day period (which period shall be extended so long as the rating of the Securities is under publicly announced consideration for a possible downgrade by any of the Rating Agencies) (the “trigger period”) after the earlier of (1) the occurrence of a Change of Control; or (2) public notice of the occurrence of a Change of Control or the intention by the Company to effect a Change of Control, (i) in the event the Securities are rated Investment Grade by at least two of the Rating Agencies prior to such public notice, the rating of the Securities by any Rating Agency shall be below Investment Grade, (ii) in the event the Securities are rated below Investment Grade by at least two of the Rating Agencies prior to such public notice, the rating of the Securities by any Rating Agency shall be decreased by one or more categories or (iii) the Securities shall not be, or cease to be, rated by at least one of the Rating Agencies; provided that, in each case, such event is in whole or in part in connection with the Change of Control.  Notwithstanding the foregoing, no Change of Control Repurchase Event will be deemed to have occurred in connection with any particular Change of Control unless and until such Change of Control has actually been consummated.
		

		
			
		

		
			

		 

		

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			“Code” means the Internal Revenue Code of 1986, as amended.
		

		
			“Collateral” means all property (whether real or personal) with respect to which any security interests have been granted (or purported to be granted) pursuant to any Security Document until the Lien on such property has been released or terminated in accordance with this Indenture or the applicable Security Document.
		

		
			“Collateral Agent” means Wells Fargo Bank, National Association, acting in its capacity as Collateral Agent for the Secured Creditors, and any successor Collateral Agent appointed hereunder pursuant to Section 12.06.
		

		
			“Collateral and Guaranty Requirements” means the requirement that:
		

		
			(1)         each of Holdings, TINC and each Collateral Rig Owner shall have duly authorized, executed and delivered to the Trustee this Indenture or a supplemental indenture substantially in the form of Appendix D hereto, as applicable, pursuant to which such Person will become a Guarantor, and the Securities Guarantee of such Person shall be in full force and effect;
		

		
			(2)         the Equity Pledgors shall have duly authorized, executed and delivered share or quota pledge agreements substantially in the form of Appendix E-1 or Appendix E-2, as applicable, with such changes to such forms as are necessary or advisable to account for local law requirements (collectively, as modified, supplemented or amended from time to time, each a “Share Pledge Agreement”), pursuant to which all of the Equity Interests of the Collateral Rig Owners and the Collateral Rig Operator (other than any Equity Interests of the Collateral Rig Operator owned by a Qualified Local Partner, if applicable at such time) shall have been pledged to the Collateral Agent to secure the Notes Obligations and shall have (A) to the extent such Equity Interests constitute possessory collateral, delivered to the Collateral Agent all the pledged Equity Interests referred to therein (if applicable, by delivery of the original of share or quota certificates), together with executed and undated transfer powers (if applicable) and other customary ancillary documentation (such as registers of shareholders or quotaholders and of the ultimate beneficial owner(s), in each case as applicable), in each case, to the extent necessary under applicable laws to perfect the security interest granted pursuant to the applicable Share Pledge Agreement, and (B) otherwise complied with all of the requirements set forth in the applicable Share Pledge Agreement, including, if applicable, filing or causing to be filed appropriate Financing Statements (Form UCC-1) for filing under the Uniform Commercial Code of each relevant jurisdiction as may be necessary or desirable to perfect the security interests purported to be created by such Share Pledge Agreement;
		

		
			(3)         the Collateral Rig Operator shall have (A) duly authorized, executed and delivered an Account Pledge Agreement pursuant to which the Earnings Account shall have been pledged to the Collateral Agent to secure the Notes Obligations and (B) duly complied with all requirements set forth in such Account Pledge Agreement, including delivery of any notices or entry into any control agreements required to perfect the security interests granted thereunder;
		

		
			(4)         the Collateral Rig Operator shall have duly authorized, executed and delivered an Assignment of Earnings substantially in the form of Appendix F (as modified, supplemented or amended from time to time, each an “Assignment of Earnings”) with respect to the Earnings, thereby granting a security interest in favor of the Collateral Agent in all of the Collateral Rig Operator’s present and future “Earnings Collateral” (as defined in the Assignment of Earnings), and filed or caused to be filed appropriate Financing Statements (Form UCC-1) for filing under the
		

		
			
		

		
			

		 

		

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			Uniform Commercial Code of each relevant jurisdiction as may be necessary or desirable to perfect the security interests purported to be created by such Assignment of Earnings;
		

		
			(5)         each Collateral Rig Owner and/or any other relevant Member of the Consolidated Group shall have duly authorized, executed and delivered an Assignment of Insurances substantially in the form of Appendix G (as modified, supplemented or amended from time to time, each an “Assignment of Insurances”) with respect to all insurance policies for its applicable Collateral Rig that insure physical damage to such Collateral Rig, thereby granting a lien in favor of the Collateral Agent on all of such Collateral Rig Owner’s and/or Member of the Consolidated Group’s present and future “Insurance Collateral” (as defined in such Assignment of Insurances);
		

		
			(6)         each Collateral Rig Owner shall have duly authorized, executed and delivered, and caused to be recorded in the appropriate vessel registry a Collateral Rig Mortgage substantially in the form of Appendix H with respect to its applicable Collateral Rig and the Collateral Rig Mortgage shall be effective to create in favor of the Collateral Agent a legal, valid and enforceable first priority lien in favor of its Collateral Agent upon the Collateral Rig, subject only to Permitted Collateral Liens;
		

		
			(7)         each Collateral Rig Owner shall have duly authorized, executed and delivered an Assignment of Bareboat Charter substantially in the form of Appendix I (as modified, supplemented or amended from time to time, each an “Assignment of Bareboat Charter”) with respect to its rights and all amounts due to it under the Bareboat Charter for the applicable Collateral Rig;
		

		
			(8)         each Collateral Rig Owner shall have (A) duly authorized, executed and delivered an Account and Receivables Pledge Agreement pursuant to which the applicable Bareboat Account and all intercompany receivables owing to such Collateral Rig Owner from time to time shall have been pledged to the Collateral Agent to secure the Notes Obligations and (B) duly complied with all requirements set forth in such Account and Receivables Pledge Agreement, including delivery of any notices or entry into any control agreements required to perfect the security interests granted thereunder;
		

		
			(9)         [Reserved];
		

		
			(10)       each Collateral Rig Owner shall have filed or caused to be filed appropriate Financing Statements (Form UCC-1) for filing under the Uniform Commercial Code of each relevant jurisdiction as may be necessary or desirable to perfect the security interests purported to be created by such Assignments of Bareboat Charter, Assignment of Insurances and the Account and Receivables Pledge Agreement;
		

		
			(11)       all filings, deliveries of instruments and other actions necessary to perfect and preserve the security interests described in clauses (2) through (10) above shall have been duly effected and the Collateral Agent shall receive evidence thereof substantially concurrently therewith;
		

		
			(12)       the Collateral Agent shall have received each of the following:
		

		
			(A)        certificates of ownership or encumbrance (or similar certificates) from appropriate authorities evidencing that each Collateral Rig is registered in the name of the applicable Collateral Rig Owner in the register of an applicable Acceptable Flag
		

		
			
		

		
			

		 

		

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			Jurisdiction and that such Collateral Rig is free from Liens other than Permitted Collateral Liens;
		

		
			(B)        a class certificate from an Acceptable Classification Society indicating that each Collateral Rig meets the criteria specified in Section 4.17(a);
		

		
			(C)        if applicable, a copy of each of the document of compliance, the safety management certificate, the international ship security certificate and all other material ISM Code and ISPS Code documentation for each Collateral Rig, together with such agreements that provide for the use by the Collateral Rig Operator of the applicable management systems of Holdings or an Affiliate of Holdings;
		

		
			(D)        a letter from each Collateral Rig Owner’s marine insurance broker, which shall be an internationally recognized marine insurance broker such as but not limited to AON, Lockton, McGriff, JLT or Marsh, with respect to the insurance maintained by the Note Parties in respect of the Collateral Rig, (x) certifying that such insurances (i) are placed with such insurance companies and/or underwriters and/or clubs, in such amounts, against such risks, and in such form, as are customarily insured against by similarly situated insureds for the protection of the Collateral Agent as secured party and mortgagee and (ii) conform with the insurance requirements of Section 4.08 and (y) including certificates of insurance with respect to the Insurances required by Section 4.08; and
		

		
			(E)        an Officers’ Certificate certifying that the requirements in the immediately preceding clauses (A) through (D) have been satisfied; and
		

		
			(13)       in connection with any Fundamental Change, Collateral Rig Substitution, Drilling Contract Substitution or Flag Jurisdiction Transfer, the Collateral Agent shall have received legal opinions addressed to the Collateral Agent from counsel to the relevant Note Parties and/or Collateral Agent in each applicable jurisdiction and covering matters consistent in scope (to the extent relevant) with the legal opinions delivered to the Collateral Agent on the Issue Date including with respect to existence, good standing, due authorization, execution, governmental approvals, entry into any relevant Security Documents and creation and perfection of the applicable Liens granted pursuant thereto, together with an Officers’ Certificate confirming that the requirements in the immediately preceding clauses (1) through (12) remain satisfied and that the Collateral Agent is authorized to enter into the applicable Security Documents in connection therewith.
		

		
			For the avoidance of doubt and notwithstanding any provision contained herein or in any other Note Document, the Collateral and Guaranty Requirements that are required to be satisfied on the Issue Date shall be satisfied substantially concurrently with the issuance of the Securities on the Issue Date.
		

		
			“Collateral Grantor” means the Equity Pledgors, the Collateral Rig Owners, the Collateral Rig Operator and each other Subsidiary of Holdings that becomes a party to a Security Document in connection with a Fundamental Change of an Equity Pledgor, a Collateral Rig Owner or the Collateral Rig Operator, a Collateral Rig Substitution, a Drilling Contract Substitution or a Flag Jurisdiction Transfer.
		

		
			“Collateral Rig” means, at any time, as applicable, (i) each of (a) the harsh environment semi-submersible drilling rig “SONGA ENABLER” and (b) the harsh environment semi-submersible drilling rig “SONGA ENCOURAGE”; and (ii) each Acceptable Rig that has replaced a previous Collateral Rig pursuant to a Collateral Rig Substitution. For the avoidance of doubt, following a Collateral Rig Substitution, the Rig replaced as a Collateral Rig by an Acceptable Rig shall no longer constitute a Collateral Rig.
		

		
			
		

		
			

		 

		

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			“Collateral Rig Indebtedness” means, as of any date of determination and without duplication, the (a) sum of all Indebtedness that is secured by a Lien on any Collateral, including the Securities minus (b) the amount in the Debt Service Reserve Account that represents a reserve for future mandatory redemptions pursuant to Section 3.09(a) of this Indenture.
		

		
			“Collateral Rig Leverage Ratio” means, as of any date of determination, the ratio of (a) Collateral Rig Indebtedness on such date to (b) Collateral Rig Net Income for the most recently ended four full consecutive fiscal quarters ended on or immediately prior to such date.
		

		
			“Collateral Rig Net Income” means, for any period (subject to the last sentence of this definition), the combined revenue of the Collateral Rig Owners and the Collateral Rig Operator attributable to the Collateral Rigs (including, for the avoidance of doubt, such revenue related to the Drilling Contracts) for such period minus operating expenses attributable to the Collateral Rigs for such period (including allocated overhead expenses).
		

		
			“Collateral Rig Mortgage” means a first preferred or priority mortgage, as the case may be, and deed of covenants, if applicable, substantially in the form of Appendix H, as such mortgage (and deed of covenants, as applicable) may be amended, modified or supplemented from time to time in accordance with the terms hereof and thereof, in each case granted by a Collateral Rig Owner in favor of the Collateral Agent, as security trustee and/or as mortgagee.
		

		
			  “Collateral Rig Operator” means, initially, Songa Opco, and thereafter, individually or collectively (as the context may require), one or more Wholly-Owned Subsidiaries of Holdings that become an operator of a Collateral Rig in accordance with Section 4.29 and to whom Earnings are paid.
		

		
			“Collateral Rig Owner” means, initially, each of Enabler Owner and Encourage Owner and thereafter any other wholly-owned Subsidiary of Holdings that acquires ownership of a Collateral Rig in accordance with Section 4.29.
		

		
			“Collateral Rig Substitution” means the exchange of a Collateral Rig for an Acceptable Rig, whether or not concurrent with a change of the applicable Collateral Rig Owner; provided that, (i) in each case, the Collateral and Guaranty Requirements shall have been satisfied respect to such Acceptable Rig on or prior to the date on which the Collateral Rig Substitution occurs; (ii) TINC shall have given the Trustee not less than 30 days (or such shorter period permitted by the Trustee in its discretion) prior written notice before a Collateral Rig Substitution shall be effective; and (iii) the Company shall have executed and delivered to the Collateral Agent an Officer’s Certificate certifying that the replacement rig constitutes an “Acceptable Rig” under the Indenture.
		

		
			“Company” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.
		

		
			“Consolidated Affiliates” means those Affiliates of Holdings that are not Subsidiaries of Holdings, but are variable interest entities whose accounts are consolidated with those of Holdings under GAAP.
		

		
			“Consolidated Group” means, collectively, Holdings and its Subsidiaries and Consolidated Affiliates.  Each Person that is Holdings or a Subsidiary or Consolidated Affiliate thereof included in the Consolidated Group at any time is referred to herein as a “Member of the Consolidated Group.”
		

		
			“Consolidated Net Tangible Assets” means the total amount of Holdings’ assets (less reserves and other properly deductible items) after deducting current liabilities (other than those that are extendable at Holdings’ option to a date more than 12 months after the date the amount is determined), goodwill and
		

		
			
		

		
			

		 

		

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			other intangible assets shown in Holdings’ most recent consolidated balance sheet prepared in accordance with GAAP.
		

		
			“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise.  “Controlling” and “Controlled” have meanings correlative thereto.
		

		
			“Corporate Trust Office” means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office at the date hereof is located at Wells Fargo Bank, National Association, 1445 Ross Avenue, Suite 4300, MAC T9216-430, Dallas, TX 75202, Attention: Corporate, Municipal & Escrow Services, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor Trustee may designate from time to time by notice to the Holders and the Company).
		

		
			“Credit Facilities” means one or more debt facilities, including the Revolving Credit Facility, or other financing arrangements (including, without limitation, commercial paper facilities or indentures) providing for revolving credit loans, term loans, letters of credit or other long-term indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof (provided that such increase in borrowings is permitted under Section 4.06) or adds Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders.
		

		
			“Currency Rate Protection Agreement” means any foreign currency exchange and future agreements, arrangements and options designed to protect against fluctuations in currency exchange rates.
		

		
			“Debt Service Reserve” means, as of any date of determination, an amount equal to the sum of (a) $41,250,000 plus (b) all interest that is scheduled to be paid by the Company under this Indenture during the immediately succeeding six months; provided, that such amount shall be increased to (i) $61,875,000 plus (ii) all interest that is scheduled to be paid by the Company under this Indenture during the immediately succeeding nine months if (x) there is one or more casualty events (other than an Event of Loss) with respect to one or both of the Collateral Rigs in excess of $50,000,000 in the aggregate, until such time as the applicable Collateral Rigs are repaired and operational under the applicable Drilling Contract, or (y) one or more counterparties under one or both of the Drilling Contracts is more than 90 days late with respect to the making of payments under such Drilling Contracts in an aggregate amount in excess of $30,000,000 or an equivalent amount for payments to be made in currencies other than United States dollars.
		

		
			“Debt Service Reserve Account” means an account established in the name of the Trustee and maintained for purpose of holding the Debt Service Reserve, in each case in accordance with the terms of Section 7.10.
		

		
			“Deed of Quiet Enjoyment” means a letter of undertaking or deed of quiet enjoyment by and among the Collateral Rig Operator, the counterparty under a Drilling Contract and the Collateral Agent to be entered into from time to time substantially in the form of Appendix K.
		

		
			“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.
		

		
			
		

		
			

		 

		

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			“Definitive Security” means a certificated Security registered in the name of the Holder thereof and issued in accordance with Section 2.3 to Appendix A of this Indenture, in substantially the form of a Global Security hereto except that such Security shall not bear the Global Security Legend and shall not have the “Schedule of Exchanges of Interests in the Global Security” attached thereto.
		

		
			“Depositary” means, with respect to the Securities issuable or issued in whole or in part in global form, the Person specified in Section 2.03 as the Depositary with respect to the Securities, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provisions of this Indenture.
		

		
			“Drilling Contract” means, at any time, as applicable, (a) each of (i) Contract No. SAP4600016880, dated as of February 23, 2012 (as amended, restated, amended and restated, supplemented or otherwise modified through the date hereof, including by that certain Purchase Order No. 4503641127, dated as of April 26, 2018), between Statoil Petroleum AS, a subsidiary of Equinor ASA (“Statoil Subsidiary”), and Songa Opco and (ii) Contract No. SAP4600016879, dated as of February 23, 2012 (as amended, restated, amended and restated, supplemented or otherwise modified through the date hereof), between Statoil Subsidiary and Songa Opco, in each case as amended, restated, amended and restated or modified from time to time in accordance with Section 4.26 of this Indenture; and (b) each Acceptable Drilling Contract that has replaced a previous Drilling Contract pursuant to a Drilling Contract Substitution. For the avoidance of doubt, following a Drilling Contract Substitution, the contract replaced by an Acceptable Drilling Contract shall no longer constitute a Drilling Contract.
		

		
			“Drilling Contract Substitution” means the exchange of a Drilling Contract for an Acceptable Drilling Contract, whether or not concurrent with a Collateral Rig Substitution; provided that, (i) a Deed of Quiet Enjoyment with respect to such Acceptable Drilling Contract shall have been executed and delivered to the Collateral Agent on or prior to the date on which the Drilling Contract Substitution occurs; (ii) TINC shall have given the Trustee not less than 30 days (or such shorter period permitted by the Trustee in its discretion) prior written notice to the Trustee before a Drilling Contract Substitution shall be effective; and (iii) the Company shall have executed and delivered to the Collateral Agent an Officer’s Certificate certifying that the replacement drilling contract constitutes an “Acceptable Drilling Contract” under the Indenture.
		

		
			“Earnings” means (i) all freight, hire, income and passage moneys payable to the Collateral Rig Operator as a consequence of the operation of the Collateral Rigs, including without limitation all payments under the Drilling Contracts, including any termination payments or settlement payments in respect thereof, (ii) any claim under any guarantee in respect of the Drilling Contracts or otherwise related to freight, hire, income or passage moneys, in each case payable to the Collateral Rig Operator as a consequence of the operation of the Collateral Rigs, (iii) any other money whatsoever due or to become due to the Collateral Rig Operator in relation to the Drilling Contract and (iv) any other money received directly or indirectly under the Drilling Contracts by the Collateral Rig Operator.
		

		
			“Earnings Account” means, individually or collectively, as the context may require, the deposit account or accounts of the Collateral Rig Operator designated as such from time to time by the Collateral Rig Operator in the applicable Account Pledge Agreement into which all Earnings derived from the Drilling Contracts are deposited.
		

		
			“Enabler Owner” means Transocean Enabler Limited, a Cayman Islands exempted company that as of the Issue Date (x) owns the Collateral Rig identified in clause (i)(a) of the definition of such term, (y) is a direct wholly-owned Subsidiary of the Company and (z) is an indirect wholly-owned Subsidiary of Holdings and TINC.
		

		
			
		

		
			

		 

		

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			“Encourage Owner” means Transocean Encourage Limited, a Cayman Islands exempted company that as of the Issue Date (x) owns the Collateral Rig identified in clause (i)(b) of the definition of such term, (y) is a direct wholly-owned Subsidiary of the Company and (z) is an indirect wholly-owned Subsidiary of Holdings and TINC.
		

		
			“Environmental Law” means any federal, state or local statute, law, rule, regulation, ordinance, code, policy or rule of common law now or hereafter in effect, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection of the environment, health, safety or natural resources, in each case, relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of any Hazardous Materials.
		

		
			“Equity Interests” of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any preferred stock, any limited or general partnership interest and any limited liability company membership interest, but excluding any debt security that is convertible into, or exchangeable for, such interests in equity.
		

		
			“Equity Pledgor” means, at any time, each of (i) SOSE, (ii) the Company and (iii) any other wholly-owned Subsidiary of Holdings that directly owns the Equity Interests of a Collateral Rig Owner or the Collateral Rig Operator (other than any Equity Interests of a Collateral Rig Operator owned by a Qualified Local Partner, if applicable at such time).
		

		
			“Event of Loss” means any of the following events: (x) the actual or constructive total loss of a Collateral Rig or the agreed or compromised total loss of a Collateral Rig; or (y) the capture, condemnation, confiscation, requisition for title and not hire, purchase, seizure or forfeiture of, or any taking of title to, a Collateral Rig.  An Event of Loss shall be deemed to have occurred: (i) in the event of an actual loss of a Collateral Rig, at the time and on the date of such loss or if that is not known at noon Greenwich Mean Time on the date which a Collateral Rig was last heard from; (ii) in the event of damage which results in the constructive or compromised or arranged total loss of a Collateral Rig, at the time and on the date on which notice claiming the loss of a Collateral Rig is given to the insurers; or (iii) in the case of an event referred to in clause (y) above, at the time and on the date on which such event is expressed to take effect by the Person making the same.  Notwithstanding the foregoing, if a Collateral Rig shall have been returned to any Note Party following any event referred to in clause (y) above prior to the date upon which payment is required to be made under Section 3.09(b), no Event of Loss shall be deemed to have occurred by reason of such event.
		

		
			“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
		

		
			“Fitch” means Fitch Ratings Ltd. or any successor to the rating agency business thereof.
		

		
			“Flag Jurisdiction Transfer” means the transfer of the registration and flag of a Collateral Rig from one Acceptable Flag Jurisdiction to another Acceptable Flag Jurisdiction, provided that the following conditions are satisfied with respect to such exchange:
		

		
			(1)         On each Flag Jurisdiction Transfer Date, the applicable Collateral Rig Owner shall have duly authorized, executed and delivered, and caused to be recorded (or made arrangements for the recordation substantially simultaneously with such date) in the vessel registry of the Acceptable Flag Jurisdiction where such Collateral Rig is being transferred a Collateral Rig Mortgage with respect to such Collateral Rig, and such Collateral Rig Mortgage shall be effective to create in favor of the Collateral Agent a legal, valid and enforceable first preferred ship mortgage or first priority statutory mortgage, as the case may be, in and lien upon such Collateral Rig, subject
		

		
			
		

		
			

		 

		

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			only to Permitted Collateral Liens.  All filings, deliveries of instruments and other actions necessary to perfect and preserve such security interests shall have been duly effected and the Collateral Agent shall receive evidence thereof substantially concurrently therewith.
		

		
			(2)         On each Flag Jurisdiction Transfer Date, the Trustee shall have received from counsel to the applicable Collateral Rig Owner practicing in those jurisdictions in which such Collateral Rig is registered after giving effect to the Flag Jurisdiction Transfer and Collateral Rig Owner is organized, opinions which shall be addressed to the Trustee and the Collateral Agent and dated such Flag Jurisdiction Transfer Date, which shall (x) be in form and substance reasonably acceptable to the Trustee and (y) cover the perfection of the liens granted pursuant to such Collateral Rig Mortgage and such other matters incident thereto as the Trustee may reasonably request.
		

		
			(3)         Substantially simultaneously with each Flag Jurisdiction Transfer Date the Trustee shall have received (x) a certificate of ownership issued by the registry of the applicable Acceptable Flag Jurisdiction showing the registered ownership of such Collateral Rig transferred on such date in the name of the applicable Collateral Rig Owner and (y) a certificate of ownership and encumbrance or, as applicable a transcript of registry with respect to such Collateral Rig indicating no record liens other than Liens in favor of the Collateral Agent and Permitted Collateral Liens.
		

		
			(4)         On or prior to each Flag Jurisdiction Transfer Date, the Trustee shall have received a certificate, dated the Flag Jurisdiction Transfer Date, signed by an Officer, member, general partner or attorney in fact of the applicable Collateral Rig Owner, certifying that (A) all necessary governmental (domestic and foreign) and third party approvals and/or consents in connection with the Flag Jurisdiction Transfer being consummated on such date and otherwise referred to herein shall have been obtained and remain in effect or that no such approvals and/or consents are required and (B) there exists no judgment, order, injunction or other restraint prohibiting or imposing materially adverse conditions upon such Flag Jurisdiction Transfer or the other transactions contemplated by this Indenture.
		

		
			(5)         On each Flag Jurisdiction Transfer Date, the Collateral and Guaranty Requirements, as applicable, for such Collateral Rig shall have been satisfied.
		

		
			(6)         On each Flag Jurisdiction Transfer Date, no Event of Default has occurred and is continuing.
		

		
			(7)         On each Flag Jurisdiction Transfer Date, the Collateral Agent has received an Officers’ Certificate confirming that the requirements set forth in the immediately preceding clauses (1) through (6) have been satisfied and that the Collateral and Guaranty Requirements continue to be satisfied.
		

		
			“Flag Jurisdiction Transfer Date” shall mean the date on which a Flag Jurisdiction Transfer occurs.
		

		
			“Fleet Status Report” means the Fleet Status Report issued by Holdings, which includes drilling contract information, drilling status and planned out-of-service time for every rig in the fleet of Holdings.
		

		
			“Funded Debt” means Indebtedness Incurred by a Priority Unsecured Notes Subsidiary Guarantor owning Rigs maturing by its terms more than one year after its creation which indebtedness is classified as long term debt under GAAP, and ranks at least pari passu with TINC’s senior unsecured Indebtedness.
		

		
			“Fundamental Change” has the meaning specified in Section 4.13.
		

		
			
		

		
			

		 

		

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			“GAAP” means generally accepted accounting principles in the United States set forth in the statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect as of the date of determination.
		

		
			“Global Security Legend” means the legend set forth in Section 2.3(e)(3) of Appendix A to this Indenture, which is required to be placed on all Global Securities issued under this Indenture.
		

		
			“Guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person:
		

		
			(1)         to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise); or
		

		
			(2)         entered into for the primary purpose of assuring in any other manner the obligee of such Indebtedness or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);
		

		
			provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.  The term “Guarantee” used as a verb has a corresponding meaning.
		

		
			“Guarantors” means (i) Holdings, (ii) TINC, (iii) each of Enabler Owner and Encourage Owner (in each case, so long as such entity owns a Collateral Rig) and (iv) each other Collateral Rig Owner (so long as such entity owns a Collateral Rig), in each case, together with their respective successors and assigns until the Securities Guarantee of such Person has been released in accordance with the provisions of this Indenture.
		

		
			“Hazardous Material” has the meaning ascribed to such term in the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Acts of 1986, and shall also include petroleum, including crude oil or any fraction thereof, petroleum distillates, asbestos and asbestos containing materials, polychlorinated biphenyls or any other substance defined as “hazardous” or “toxic” or words with similar meaning and effect under any Environmental Law applicable to the Company, the Collateral Rig Owners or the Collateral Rig Operator.
		

		
			“Holder” means the Person in whose name a Security is registered on the Registrar’s books.
		

		
			“Holdings” means Transocean Ltd., a Swiss corporation registered in Zug, Switzerland and the direct or indirect sole shareholder of TINC, Enabler Owner and Encourage Owner, SOSE, Songa Opco and the Company as of the Issue Date.
		

		
			“Incur” means issue, assume, Guarantee, incur or otherwise become liable for.  The term “Incurrence” when used as a noun shall have a correlative meaning.
		

		
			“Indebtedness” means all obligations for borrowed money represented by notes, bonds, debentures or similar evidence of indebtedness and obligations for borrowed money evidenced by credit, loan or other like agreements.
		

		
			“Indenture” means this Indenture as amended, supplemented or otherwise modified from time to time.
		

		
			
		

		
			

		 

		

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			“Indirect Participant” means a Person who holds a beneficial interest in a Global Security through a Participant.
		

		
			“Interest Rate Protection Agreement” means any interest rate swap, interest rate cap, interest rate collar, or other interest rate hedging agreement or arrangement designed to protect against fluctuations in interest rates.
		

		
			“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); and a rating of BBB- or better by Fitch (or its equivalent under any successor rating categories of Fitch).
		

		
			“Issue Date” means July 13, 2018.
		

		
			“Legal Holiday” means a Saturday, Sunday or other day on which banking institutions are not required by law or regulation to be open in the State of New York.
		

		
			“Lien” means any mortgage, pledge, lien, encumbrance, charge or security interest.
		

		
			“Make-Whole Premium” shall mean, with respect to any Securities on any applicable date of repayment following acceleration of the Securities or redemption on or prior to July 15, 2021, the greater of:
		

		
			(1)         1% of the principal amount of the Securities being repaid following acceleration of the Securities (including following a bankruptcy event of default) or redeemed; and
		

		
			(2)         if such repayment or redemption occurs on or prior to July 15, 2021, an amount equal to the excess, if any, of (a) the present value (at such date of repayment or redemption) of the sum of (i) 102.938% of the principal amount of the Securities being repaid following acceleration of the Securities (including following a bankruptcy event of default) or redeemed at July 15, 2021 plus (ii) all required payments of interest on the Securities being repaid or redeemed, in each case, through July 15, 2021 (excluding accrued and unpaid interest to the date of repayment or redemption and any interest accruing at the default rate) over (b) the principal amount of the Securities being repaid or redeemed.
		

		
			The present value shall be calculated using a discount rate equal to the Treasury Rate plus 50 basis points. The Make-Whole Premium will be calculated by the Company in accordance with the formula set forth above.
		

		
			“Master Services Agreement” means that certain Master Services Agreement, effective as of January 1, 2008, by and among Transocean Offshore Deepwater Drilling Inc., GlobalSantaFe Corporate Services Inc., TINC and certain Affiliates (as defined therein) of Transocean Offshore Deepwater Drilling Inc. party thereto from time to time, as amended.
		

		
			“Material Adverse Effect” means a material adverse effect on (i) the business, assets, financial condition or results of operations of the Company, Holdings and other Members of the Consolidated Group, taken as a whole, (ii) the Company’s or any Guarantor’s ability to perform any of its payment obligations under this Indenture or the other Note Documents, or (iii) the rights and remedies of the Trustee, the Collateral Agent and/or the Holders under this Indenture and the other Note Documents.
		

		
			
		

		
			

		 

		

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			“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, automatic acceleration in accordance with Section 6.02 hereof, notice of redemption, exercise of a Holder’s option to require the Company to purchase or repay the Security, or otherwise.
		

		
			“Moody’s” means Moody’s Investors Service, Inc. or any successor to the rating agency business thereof.
		

		
			“Non-Recourse Debt” means (i) any Indebtedness incurred by any Project Financing Subsidiary to finance the acquisition, improvement, design, engineering, construction, development, completion, maintenance or operation of, or otherwise to pay costs and expenses relating to or incurred in connection with the foregoing for, any Rig, which Indebtedness does not provide for recourse against Holdings, TINC or any other Member of the Consolidated Group (other than to such Project Financing Subsidiary with respect to customary non-recourse exceptions, and such recourse as exists under a Performance Guaranty given for the benefit of such Project Financing Subsidiary) or any property or asset of Holdings, TINC or any other Member of the Consolidated Group (other than equity interests of, and such Rig and related assets of, such Project Financing Subsidiary, and such recourse as exists under a Performance Guaranty given for the benefit of such Project Financing Subsidiary) and (ii) any refinancing of such Indebtedness that does not increase the outstanding principal amount thereof (other than to pay costs incurred in connection therewith and the capitalization of any interest, fees or premium) at the time of the refinancing, increase the property subject to any lien securing such Indebtedness, or provide for recourse against any other Member of the Consolidated Group.
		

		
			“Note Documents” means this Indenture, the Securities, the Securities Guarantees and each Security Document, in each case, as amended, modified, renewed, restated or replaced, in whole or in part, from time to time.
		

		
			“Note Party” means each of (i) the Company, (ii) Holdings, (iii) TINC, and (iv) the Collateral Grantors.
		

		
			“Notes Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, the Company or any other Note Party arising under this Indenture, the Securities, the Securities Guarantees and the Security Documents (including all principal, premium (including the Make-Whole Premium), interest, penalties, fees, charges, expenses, indemnifications, reimbursement obligations, damages, guarantees, and other liabilities or amounts payable or arising thereunder), whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against the Company or any other Note Party of any proceeding in bankruptcy or insolvency law naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.
		

		
			“Offering Memorandum” means the offering memorandum dated as of June 27, 2018 relating to the offering of the Securities on the Issue Date.
		

		
			“Officer” means with respect to any Person any one of the Chief Executive Officer, the Chief Financial Officer, the Chairman, any Deputy Chairman, the President, any Senior Vice President, any Vice President, the Controller, the Treasurer, any Director or the Secretary of such Person.
		

		
			“Officer’s Certificate” means a certificate signed by any one of the Chairman, any Deputy Chairman, President, any Senior Vice President or any Vice President, together with any one of the
		

		
			
		

		
			

		 

		

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			Treasurer, any Assistant Treasurer, any Director, the Secretary or any Assistant Secretary, of such Person, and delivered to the Trustee or the Collateral Agent, as applicable.
		

		
			“Opinion of Counsel” means a written opinion of counsel, who may be internal legal counsel for a Note Party, and who shall be reasonably acceptable to the Trustee or the Collateral Agent, as applicable.
		

		
			“Organizational Documents” with respect to any Person shall mean, as applicable, such Person’s memorandum of association or certificate of incorporation, memorandum and articles of association, certificate of formation (including, without limitation, by the filing or modification of any certificate of designation), by-laws, limited liability company agreement or partnership agreement or, in each case, equivalent organizational documents.
		

		
			“Outstanding”, when used with respect to Securities, means, as of any date of determination, all Securities theretofore authenticated and delivered under this Indenture, except:
		

		
			(1)         Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;
		

		
			(2)         Securities, or portions thereof for which payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;
		

		
			(3)         Securities, except to the extent provided in Sections 8.02 and 8.03, with respect to which the Company has effected defeasance and/or covenant defeasance as provided in Article 8; and
		

		
			(4)         Securities which have been issued pursuant to Section 2.07 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a “protected purchaser” (as defined in Article 8 of the UCC) in whose hands such Securities are valid obligations of the Company;
		

		
			provided,  however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, or are present at a meeting of Holders for quorum purposes, Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which a Trust Officer actually knows to be so owned shall be so disregarded.  Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor.
		

		
			“Participant” means, with respect to the Depositary, a Person who has an account with the Depositary.
		

		
			
		

		
			

		 

		

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			“Performance Guaranties” means all guaranties of TINC, Holdings, or any other Member of the Consolidated Group delivered in connection with the construction financing of Rigs for which firm drilling contracts have been obtained by TINC, Holdings or any other Member of the Consolidated Group.
		

		
			“Performance Letters of Credit” means all letters of credit issued as support for Non-Recourse Debt or a Performance Guaranty.
		

		
			“Permitted Collateral Liens” means the following types of Liens:
		

		
			(i)          Liens securing the Notes Obligations;
		

		
			(ii)         statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen, employees, pension plan administrators or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith or Liens relating to attorney’s liens or bankers’ liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depositary institution;
		

		
			(iii)       Liens for taxes or assessments or governmental charges or levies (i) that are not yet delinquent, or which can thereafter be paid without penalty, in each case such that the Lien cannot be enforced or (ii) which are being contested in good faith by appropriate proceedings and for which reserves have been provided in conformity with GAAP;
		

		
			(iv)        Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired; and
		

		
			(v)         Liens incurred in the ordinary course of business of the Note Parties arising from Collateral Rig chartering, drydocking, maintenance, repair, refurbishment, the furnishing of supplies and bunkers to the Collateral Rig or masters, officers’ or crews’ wages and maritime Liens, in the case of each of the foregoing, (i) which were not Incurred or created to secure the payment of Indebtedness and (ii) (x) for payments not more than ninety (90) days past-due, or which can thereafter be paid without penalty or (y) which are being contested in good faith by appropriate proceedings and for which reserves have been provided in conformity with GAAP.
		

		
			“Permitted Jurisdiction” means, (i) with respect to the Collateral Rig Owners, any of Norway, Switzerland, England and Wales, Scotland, Luxembourg, Ireland, Hungary, the Marshall Islands, the Cayman Islands, Denmark, the Netherlands or the United States (or any State thereof, including the District of Columbia) or (ii) with respect to the Collateral Rig Operator, any of Norway, Switzerland, England and Wales, Scotland, Luxembourg, Ireland, Hungary, the Marshall Islands, the Cayman Islands, Denmark, the United States (or any State thereof, including the District of Columbia), any current or former member of the European Union, the British Virgin Islands or the Bahamas.
		

		
			“Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization or any other entity or organization, including any governmental authority.
		

		
			“Priority Unsecured Notes Subsidiary Guarantor” means a “Subsidiary Guarantor” as defined in the 2023 Notes Indenture or the 2026 Notes Indenture.
		

		
			
		

		
			

		 

		

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			“Private Placement Legend” means the legend set forth in Section 2.3(e)(1) of Appendix A hereof to be placed on all Securities issued under this Indenture except as otherwise permitted by the provisions of this Indenture.
		

		
			“Project Financing Subsidiary” means any Subsidiary of Holdings or TINC (other than TINC and the Priority Unsecured Notes Subsidiary Guarantors) created for the sole purpose of incurring Non-Recourse Debt to finance the acquisition, improvement, design, engineering, construction, development, completion, maintenance and operation of, or otherwise pay the costs and expenses relating to or incurred in connection with the foregoing for, any Rig, and to conduct the business activities for which such Non-Recourse Debt was incurred, provided that substantially all of the assets of such Person are comprised of such Rig so financed.
		

		
			“QIB” means a “qualified institutional buyer” as defined in Rule 144A.
		

		
			“Qualified Local Partner” means any Person that is required or necessary under local law to own Equity Interests in the Collateral Rig Operator as a condition for the operation of a Collateral Rig in such jurisdiction, subject to receipt by the Collateral Agent of an agreement in writing whereby such Person:
		

		
			(1)         acknowledges the Liens granted in favor of the Collateral Agent to secure the Notes Obligations (a) on the Earnings under the Assignment of Earnings, (b) on the Earnings Account under the Account Pledge Agreement and any account control agreement related thereto and (c) on the Equity Interests of the Collateral Rig Operator owned by the Equity Pledgor under the applicable Share Pledge Agreement;
		

		
			(2)         acknowledges that pursuant to the applicable Share Pledge Agreement, the Collateral Agent has the right to foreclose on the Equity Interests of the Collateral Rig Operator owned by the applicable Equity Pledgor and by way of such foreclosure the Collateral Agent shall have the right to transfer such Equity Interests of the Collateral Rig Operator to a Person who is not an Affiliate of Holdings, and such Person agrees that it (a) will not object to any such foreclosure or transfer and (b) will cooperate with the Collateral Agent in connection with any such foreclosure or transfer;
		

		
			(3)         consents to the foregoing and agrees that it will not take any action that would (a) have the effect of restraining or interfering in any material respect with the assertion by the Collateral Agent or any other Secured Creditor of any claims, or the exercise by the Collateral Agent or any other Secured Creditor of any rights that any of them may at any time have, against the Collateral Rig Operator, any of its direct or indirect Subsidiaries or any of their respective assets, pursuant to or in connection with the Note Documents or (b) otherwise interfere in any material respect with any obligations of the Collateral Rig Operator under the Note Documents;
		

		
			(4)         agrees that it shall only have the right to receive de minimis dividends, other similar payments or distributions from the Collateral Rig Operator to the extent required or necessary under local law, including upon any liquidation, dissolution or winding up of the Collateral Rig Operator; and
		

		
			(5)         agrees that it shall not sell, transfer, pledge or encumber the Equity Interests it owns in the Collateral Rig Operator.
		

		
			“Rating Agency” means each of Moody’s, S&P and Fitch; provided that, if any of Moody’s, S&P or Fitch ceases to rate the Securities or fails to make a rating of the Securities publicly available for any reason that is beyond the Company’s control, the Company may select (as certified by a resolution of the
		

		
			
		

		
			

		 

		

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			Company’s board of directors or other equivalent governing body) a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, as a replacement agency for Moody’s, S&P or Fitch, or all of them, as the case may be.
		

		
			“Reactivation Costs” means any and all costs and expenses associated with the reactivation of a Rig from a stacked condition incurred or accrued through the date such Rig commences commercial operation pursuant to a drilling contract.
		

		
			“Restricted Definitive Security” means one or more Definitive Securities bearing the Private Placement Legend.
		

		
			“Restricted Global Security” means 144A Global Securities and Regulation S Global Securities.
		

		
			“Restricted Property” means (a) any Rig; provided that no Rig that has a gross book value of less than 1% of TINC’s Consolidated Net Tangible Assets will be deemed to be a “Rig” for purposes of this clause (a) or (b) the stock or indebtedness of any Subsidiary of TINC owning or leasing a Rig referred to in clause (a).
		

		
			  “Revolving Credit Facility” means the Credit Agreement, dated as of June 22, 2018, among, inter alia, TINC, Citibank, N.A., as administrative agent and collateral agent, and the lenders party thereto, as amended, supplemented, restated or otherwise modified from time to time.
		

		
			“Rig” means any drilling rig or drillship that TINC or any of its Subsidiaries leases or owns, either entirely or in part.
		

		
			  “Rule 144” means Rule 144 promulgated under the Securities Act.
		

		
			“Rule 144A” means Rule 144A promulgated under the Securities Act.
		

		
			“Rule 903” means Rule 903 promulgated under the Securities Act.
		

		
			“Rule 904” means Rule 904 promulgated under the Securities Act.
		

		
			“S&P” means S&P Global Ratings, a division of The McGraw-Hill Companies, Inc. or any successor to the rating agency business thereof.
		

		
			“Sale and Leaseback Transaction” means any arrangement with any Person pursuant to which TINC, Holdings or any of its Subsidiaries leases any Rig that has been or is to be sold or transferred by TINC, Holdings or any of its Subsidiaries to such Person, other than (1) temporary leases for a term, including renewals at the option of the lessee, of not more than three years, (2) leases between TINC, Holdings and any of its Subsidiaries or between any of its Subsidiaries, (3) leases of a Rig executed by the time of, or within 12 months after the latest of, the acquisition, the completion of construction or improvement, or the commencement of commercial operation of, the Rig, and (4) arrangements pursuant to any provision of law with an effect similar to the former Section 168(f)(8) of the Internal Revenue Code of 1954.
		

		
			“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including the Patriot Act and those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, Her Majesty’s Treasury of the
		

		
			
		

		
			

		 

		

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			United Kingdom, Norway, and the State Secretariat for Economic Affairs of Switzerland or the Swiss Directorate of International Law.
		

		
			“SEC” means the U.S. Securities and Exchange Commission.
		

		
			“Secured Creditors” means the Holders of the Securities, the Trustee and the Collateral Agent, each in their respective capacities.
		

		
			“Securities” means the 5.875% Senior Secured Notes due 2024 issued on the Issue Date.
		

		
			“Securities Act” means the U.S. Securities Act of 1933, as amended.
		

		
			“Securities Guarantee” means each Guarantee of the obligations with respect to the Securities issued by a Guarantor pursuant to the term of this Indenture.
		

		
			“Security Documents” means each Deed of Quiet Enjoyment, each Share Pledge Agreement, each Account and Receivables Pledge Agreement and any account control agreement related thereto, each Account Pledge Agreement and any account control agreement related thereto, each Assignment of Earnings, each Assignment of Insurances, each Assignment of Bareboat Charter, each Collateral Rig Mortgage, and, after the execution and delivery thereof, each additional security document that grants a Lien in favor of the Collateral Agent for the benefit of the Secured Creditors that is executed pursuant to Section 4.27 or in connection with a Fundamental Change, Collateral Rig Substitution, Drilling Contract Substitution or Flag Jurisdiction Transfer.
		

		
			“Share Pledge Agreement” has the meaning given such term in the definition of Collateral and Guaranty Requirements.
		

		
			“Songa Opco” means Songa Offshore Rig 3 AS, a company incorporated under the laws of Norway that as of the Issue Date (x) operates the Collateral Rigs, (y) is a direct Wholly-Owned Subsidiary of SOSE and (z) is an indirect Wholly-Owned Subsidiary of Holdings and TINC.
		

		
			“SOSE” means Songa Offshore SE, a European public company limited by shares (or societas europaea), duly registered and validly existing under the laws of Cyprus with company registration number SE9, with its principal executive offices located at Porto Bello Building, Office 201, No. 1 Siafi Street, Limassol, 304, Cyprus.
		

		
			“Stated Maturity” means with respect to any Indebtedness, the date specified in the instrument governing such Indebtedness as the fixed date on which the principal of such Indebtedness or any installment thereof, or any installment of interest thereon, is scheduled to be due and payable, and shall not include any contingent obligations to repay, redeem or repurchase any such principal or interest prior to such date.
		

		
			“Subsidiary” means, for any Person, any other Person of which more than fifty percent (50%) of the outstanding stock or comparable equity interests having ordinary voting power for the election of the board of directors, managers, or comparable governing board or body of such other Person (irrespective of whether or not at the time stock or other equity interests of any other class or classes of such corporation or other entity shall have or might have voting power by reason of the happening of any contingency), is at the time directly or indirectly owned by any such Person or by one or more of its Subsidiaries.
		

		
			“Swiss Group Company” means Holdings and any Subsidiary of Holdings organized in Switzerland.
		

		
			
		

		
			

		 

		

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			“Swiss Withholding Tax” means taxes imposed under the Swiss Withholding Tax Act.
		

		
			“Swiss Withholding Tax Act” means the Swiss Federal Act on the Withholding Tax of October 13, 1965 (Bundesgesetz über die Verrechnungssteuer), together with the related ordinances, regulations and guidelines, all as amended and applicable from time to time.
		

		
			  “TINC” means Transocean Inc., a Cayman Islands exempted company that as of the Issue Date is a direct wholly-owned Subsidiary of Holdings.
		

		
			“Total Consolidated EBITDA” means, for any period, the consolidated net income (as determined in accordance with GAAP) of the Consolidated Group for such period (i) before deducting therefrom any provision for taxes that would be included in determining such net income, (ii) before deducting therefrom any interest, commission, fees, discounts, prepayment fees, premiums or charges and other finance payments whether paid, payable or capitalized that would be included in determining such net income, (iii) before deducting therefrom any amount attributable to the amortization, depreciation or impairment of assets that would be included in determining such net income, (iv) before taking into account any exceptional items that would be included in determining such net income and (v) before deducting therefrom any amount attributable to Reactivation Costs.  For purposes of calculating Total Consolidated EBITDA:
		

		
			(i)          acquisitions that have been made by any Member of the Consolidated Group, including through mergers, consolidations or otherwise, and including in each case any related financing transactions (including repayment of Indebtedness) during the relevant reference period or subsequent to such reference period and on or prior to the date on which the calculation of Total Consolidated EBITDA is made (the “Calculation Date”), will be given pro forma effect as if they had occurred on the first day of the applicable reference period, including any consolidated net income and any pro forma expense and cost reductions that have occurred or are reasonably expected to occur within the next 12 months, provided that such cost savings or operating improvements could then be reflected in pro forma financial statements in accordance with Regulation S-X promulgated under the Securities Act or any other regulation or policy of the SEC related thereto; and
		

		
			(ii)         the consolidated net income attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, will be excluded.
		

		
			“Total Consolidated Indebtedness” means, as of any date of determination and without duplication, the sum of all Indebtedness of the Consolidated Group that would be reflected on a consolidated balance sheet of Holdings prepared in accordance with GAAP.  Notwithstanding anything to the contrary in this Indenture, for purposes of calculating Total Consolidated Indebtedness pursuant to the terms of this Indenture, GAAP will be deemed to treat leases that would have been classified as operating leases in accordance with generally accepted accounting principles in the United States of America as in effect on December 31, 2017 in a manner consistent with the treatment of such leases under generally accepted accounting principles in the United States of America as in effect on December 31, 2017, notwithstanding any modifications or interpretive changes thereto that may occur thereafter.
		

		
			“Total Leverage Ratio” means, as of any date of determination, the ratio of (a) Total Consolidated Indebtedness on such date to (b) Total Consolidated EBITDA for the most recently ended four full consecutive fiscal quarters ended on or immediately prior to such date.
		

		
			“Treasury Rate” means as of any date of redemption of the Securities, the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and
		

		
			
		

		
			

		 

		

			21

		

 

		

			 

		

		

		
			published in the most recent Federal Reserve Statistical Release H.15 that has become publicly available at least two Business Days prior to the redemption date (or, if such Statistical Release is no longer published, any publicly available source or similar market data)) most nearly equal to the period from the redemption date to July 15, 2021; provided,  however, that if the period from the redemption date to July 15, 2021 is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the redemption date to July 15, 2021 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.  The Company will (1) calculate the Treasury Rate on the second Business Day preceding the applicable redemption date, and (2) prior to such redemption date file with the Trustee an Officer’s Certificate setting forth the Make-Whole Premium and the Treasury Rate and showing the calculation of each in reasonable detail.
		

		
			“Trustee” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.
		

		
			“Trust Officer” means, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.
		

		
			“Unrestricted Definitive Securities” means one or more Definitive Securities that do not and are not required to bear the Private Placement Legend.
		

		
			“Unrestricted Global Securities” means one or more Global Securities that do not and are not required to bear the Private Placement Legend and are deposited with and registered in the name of the Depositary or its nominee.
		

		
			“Value” means, with respect to a Sale and Leaseback Transaction, an amount equal to the present value of the lease payments with respect to the term of the lease remaining on the date as of which the amount is being determined, without regard to any renewal or extension options contained in the lease which are outstanding on the effective date of such Sale and Leaseback Transaction and which have the benefit of Section 4.07.
		

		
			“Voting Stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.
		

		
			“Wholly-Owned Subsidiary” means, with respect to any Person, any other Person whose Equity Interests are 100% owned by such Person directly or indirectly, except to the extent that the Equity Interests of such other Person are held by a Qualified Local Partner, but only to the minimum extent necessary under local law for the operation of a Collateral Rig in such jurisdiction.
		

		
			SECTION 1.02. Other Definitions
		

			
					
						Term

					
					
						    

					
					
						Defined in Section

				
	
					
						“144A Global Security”

					
					
						 

					
					
						Appendix A 2.1(a)

				
	
					
						“Agent Members”

					
					
						 

					
					
						Appendix A 2.1(b)

				

		
			
		

		

		 

		

			22

		

 

		

			 

		

	
					
						

					
						“Appendix A”

					
					
						    

					
					
						2.01

				
	
					
						“Change of Control Offer”

					
					
						 

					
					
						4.02(a)

				
	
					
						“Change of Control Payment Date”

					
					
						 

					
					
						4.02(b)(4)

				
	
					
						“covenant defeasance”

					
					
						 

					
					
						8.03

				
	
					
						“defeasance”

					
					
						 

					
					
						8.02

				
	
					
						“DTC”

					
					
						 

					
					
						2.03

				
	
					
						“Event of Default”

					
					
						 

					
					
						6.01

				
	
					
						“Global Security”

					
					
						 

					
					
						Appendix A 2.1(a)

				
	
					
						“Guaranteed Obligations”

					
					
						 

					
					
						11.01

				
	
					
						“Initial Lien”

					
					
						 

					
					
						4.03(c)

				
	
					
						“Paying Agent”

					
					
						 

					
					
						2.03

				
	
					
						“Registrar”

					
					
						 

					
					
						2.03

				
	
					
						“Regulation S Global Security”

					
					
						 

					
					
						Appendix A 2.1(a)

				
	
					
						“Trust Indenture Act”

					
					
						 

					
					
						1.06

				
	
					
						“U.S. Government Obligations”

					
					
						 

					
					
						8.04 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			SECTION 1.03. Rules of Construction.  Unless the context otherwise requires:
		

		
			(1)         a term has the meaning assigned to it;
		

		
			(2)         an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;
		

		
			(3)         “or” is not exclusive;
		

		
			(4)         “including” means including without limitation;
		

		
			(5)         words in the singular include the plural and words in the plural include the singular;
		

		
			(6)         all references to the date the Securities were originally issued shall refer to the Issue Date;
		

		
			(7)         unless the context otherwise requires, any reference to an “Appendix,” “Article,” “Section,” “clause,” “Schedule” or “Exhibit” refers to an Appendix, Article, Section, clause, Schedule or Exhibit, as the case may be, of this Indenture;
		

		
			(8)         references to sections of, or rules under, the Securities Act or the Exchange Act shall be deemed to include substitute, replacement or successor sections or rules adopted by the SEC from time to time;
		

		
			(9)         unless otherwise provided, references to agreements and other instruments shall be deemed to include all amendments and other modifications to such agreements or instruments, but only to the extent such amendments and other modifications are not prohibited by the terms of this Indenture;
		

		
			(10)       in the event that a transaction meets the criteria of more than one category of permitted transactions or listed exceptions, the Company, other applicable Note Party or Subsidiary of Holdings may classify, divide or reclassify such transaction as it, in its sole discretion, determines; and
		

		
			
		

		
			

		 

		

			23

		

 

		

			 

		

		

		
			(11)       all references to a “first-priority perfected Lien” in this Indenture shall be understood to be subject to Permitted Collateral Liens.
		

		
			SECTION 1.04. Agent for Service; Submission to Jurisdiction; Waiver of Immunities.  By the execution and delivery of this Indenture, the Company and each Guarantor (i) irrevocably designates and appoints, and acknowledges that it has irrevocably designated and appointed, Transocean Offshore Deepwater Drilling Inc., 4 Greenway Plaza, Houston, Texas 77046 as its authorized agent upon which process may be served in any suit, action or proceeding arising out of or relating to the Securities, the Securities Guarantees, this Indenture or any other Note Document that may be instituted in any United States federal or New York state court in The City of New York or brought under federal or state securities laws or brought by the Trustee (whether in its individual capacity or in its capacity as Trustee hereunder) or, subject to Section 6.07, any Holder of Securities or Securities Guarantees in any United States federal or New York state court in The City of New York, (ii) submits to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) agrees that service of process upon the Company and written notice of said service to the Company (mailed or delivered to its Secretary at its principal office specified in Section 14.01), shall be deemed in every respect effective service of process upon the Company in any such suit, action or proceeding.  The Company further agrees to take any and all action, including the execution and filing of any and all such documents and instruments, as may be necessary to continue such designation and appointment of the Company in full force and effect so long as any of the Securities shall be Outstanding or any amounts shall be payable in respect of any Securities.
		

		
			Each of the Company and the Guarantors irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of venue of any such action, suit or proceeding in any such court or any appellate court with respect thereto and irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of any such action, suit or proceeding in any such court.
		

		
			To the extent that the Company or any Guarantor has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, each of them hereby irrevocably waives such immunity in respect of its obligations under this Indenture, the Securities Guarantees, the Securities and any other Note Document, to the extent permitted by law.
		

		
			SECTION 1.05. Currency.  References herein to “$” are to lawful money of United States of America.
		

		
			SECTION 1.06. No Incorporation by Reference of Trust Indenture Act.  This Indenture is not qualified under the U.S. Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), and the Trust Indenture Act shall not apply to or in any way govern the terms of this Indenture.  As a result, no provisions of the Trust Indenture Act are incorporated into this Indenture.
		

		
			Article 2
		

		
			The Securities
		

		
			SECTION 2.01. Form and Dating.  Provisions relating to the Securities are set forth in Appendix A attached hereto (“Appendix A”) which is hereby incorporated in, and expressly made part of, this Indenture.  The Securities and the Trustee’s certificate of authentication shall be substantially in the form included in Exhibit 1.1 to Appendix A, which are hereby incorporated in, and expressly made a part of, this Indenture.  The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company).  Each Security shall be dated the
		

		
			
		

		
			

		 

		

			24

		

 

		

			 

		

		

		
			date of its authentication.  The terms of the Securities set forth in Appendix A are part of the terms of this Indenture.
		

		
			SECTION 2.02. Execution and Authentication.  An Officer shall sign the Securities for the Company by manual or facsimile signature.
		

		
			If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.
		

		
			A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security.  The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.
		

		
			The Trustee, upon a written order of the Company signed by an Officer of the Company, together with the other documents required by Sections 14.02 and 14.03, shall authenticate Securities for original issue on the Issue Date in the aggregate principal amount not to exceed $750,000,000.  Such written order of the Company shall specify the amount of Securities to be authenticated and the date on which the original issue of Securities is to be authenticated.
		

		
			The Trustee may appoint an authenticating agent reasonably acceptable to the Company to authenticate the Securities.  Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights as any Registrar, Paying Agent or agent for service of notices and demands.
		

		
			SECTION 2.03. Registrar and Paying Agent.  The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Securities may be presented for payment (the “Paying Agent”).  The Registrar shall keep a register of the Securities and of their transfer and exchange.  The Company may have one or more co-registrars and one or more additional paying agents.  The term “Paying Agent” includes any additional paying agent.
		

		
			If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate reasonable compensation therefor pursuant to Section 7.06.  The Company may change the Paying Agent or Registrar without prior notice to the Holders.  The Company or any of its Affiliates incorporated or organized within The United States of America may act as Paying Agent, Registrar, co-registrar or transfer agent.
		

		
			The Company initially appoints the Trustee as Registrar and Paying Agent in connection with the Securities.
		

		
			The Company initially appoints The Depository Trust Company (“DTC”) to act as Depositary with respect to the Global Securities.
		

		
			SECTION 2.04. Paying Agent To Hold Money in Trust.  Prior to each due date of the principal of and interest on any Security, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal and interest when so becoming due.  The Company shall require each Paying Agent (other than the Trustee) to agree in writing that the Paying Agent shall hold in trust for the benefit of Holders of Securities or the Trustee all money held by the Paying Agent for the payment of principal of or interest on the Securities and shall notify the Trustee of any default by the Company in making any such payment.  If the Company or any of its Affiliates acts as Paying Agent, it shall segregate the money held by it as Paying
		

		
			
		

		
			

		 

		

			25

		

 

		

			 

		

		

		
			Agent and hold it as a separate trust fund.  The Company at any time may require a Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed by the Paying Agent.  Upon complying with this Section, the Paying Agent shall have no further liability for the money delivered to the Trustee.
		

		
			SECTION 2.05. Lists of Holders of Securities.  The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders of Securities.  If the Trustee is not the Registrar, the Company shall furnish to the Trustee, in writing at least five Business Days before each interest payment date with respect to Securities and at such other times as the Trustee may reasonably request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders of Securities.
		

		
			SECTION 2.06. Transfer and Exchange.  The Securities shall be issued in registered form and shall be transferable only upon the surrender of a Security for registration of transfer.  When a Security is presented to the Registrar or a co-registrar, if any, with a request to register a transfer, the Registrar shall register the transfer as requested if the requirements of this Indenture (including Appendix A thereto) are met.  When Securities are presented to the Registrar or a co-registrar, if any, with a request to exchange them for an equal principal amount of Securities of other denominations, the Registrar shall make the exchange as requested if the same requirements are met.
		

		
			The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Depositary participants or beneficial owners of interests in any Definitive Security or Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
		

		
			Neither the Trustee nor any agent of the Trustee shall have any responsibility for any actions taken or not taken by the Depositary.
		

		
			SECTION 2.07. Replacement Securities.  If any mutilated Security is surrendered to the Trustee or either the Company or the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Security, the Company shall issue and the Trustee, upon receipt of evidence of authentication in accordance with Section 2.02, shall authenticate a replacement Security if the Trustee’s requirements for replacement of Securities are met.  An indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a Security is replaced.  The Trustee and the Company each may charge such Holder for their expenses in replacing such Security.
		

		
			Every replacement Security is an additional obligation of the Company and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Securities duly issued hereunder.
		

		
			SECTION 2.08. Outstanding Securities.  Securities outstanding at any time are all Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section as not outstanding.
		

		
			If a Security is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Security is held by a protected purchaser (as defined in Section 8-303 of the Uniform Commercial Code).
		

		
			
		

		
			

		 

		

			26

		

 

		

			 

		

		

		
			If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a redemption date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities (or portions thereof) to be redeemed or maturing, as the case may be, then on and after that date such Securities (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
		

		
			SECTION 2.09. Temporary Securities.  Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities.  Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities.  Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Securities and deliver them in exchange for temporary Securities.
		

		
			SECTION 2.10. Cancellation.  The Company at any time may deliver Securities to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment.  The Trustee and no one else shall cancel and dispose of in accordance with the Trustee’s policy then in effect (subject to the record retention requirements of the Exchange Act) all Securities surrendered for registration of transfer, exchange, payment or cancellation in accordance with its retention policy then in effect, unless  the Company directs the Trustee in writing to deliver canceled Securities to the Company.  The Company may not issue new Securities to replace Securities it has redeemed, paid or delivered to the Trustee for cancellation.
		

		
			SECTION 2.11. Defaulted Interest.  If the Company defaults in a payment of principal, interest or any other amount on the Securities, the Company shall pay defaulted interest at the rate specified in the Securities (plus interest on such defaulted interest to the extent lawful) in any lawful manner.  The Company may pay the defaulted interest to the persons who are Holders of Securities on a subsequent special record date.  The Company shall fix or cause to be fixed any such special record date and payment date; provided that no such special record date may be less than 10 days prior to the related payment date for such defaulted interest.   At least 15 days before the special record date, the Company (or, upon written request of the Company, the Trustee in the name and at the expense of the Company) will send to each Holder of Securities a notice that states the special record date, the payment date and the amount of defaulted interest to be paid. The Trustee will have no duty whatsoever to determine whether any defaulted interest is payable or the amount thereof.
		

		
			SECTION 2.12. CUSIP Numbers, ISINs, etc.  The Company in issuing the Securities may use “CUSIP” numbers, ISINs and “Common Code” numbers (in each case if then generally in use) and, if so, the Trustee shall use “CUSIP” numbers, ISINs and “Common Code” numbers in notices of redemption as a convenience to Holders; provided,  however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers.  The Company shall advise the Trustee in writing of any change in any “CUSIP” numbers, ISINs or “Common Code” numbers applicable to the Securities.
		

		
			Article 3
		

		
			Redemption
		

		
			SECTION 3.01. Notices to Trustee.  If the Company elects to redeem Securities pursuant to Section 3.08 or Section 3.10, it shall notify the Trustee in writing of the redemption date, the principal amount of Securities to be redeemed, the redemption price, if then ascertainable and the paragraph or subparagraph of such Article or Section of this Indenture pursuant to which the redemption shall occur.
		

		
			
		

		
			

		 

		

			27

		

 

		

			 

		

		

		
			The Company shall give each notice to the Trustee provided for in this Section at least five Business Days prior to the giving of notice of a redemption unless the Trustee consents to a shorter period.  Such notice shall be accompanied by an Officer’s Certificate from the Company to the effect that such redemption will comply with the conditions herein.
		

		
			SECTION 3.02. Selection of Securities to Be Redeemed.  Other than with respect to redemptions pursuant to Section 3.09(a), if fewer than all the Securities are to be redeemed, the Trustee shall select the Securities to be redeemed (1) if such Securities are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which such Securities are listed, (2) if such Securities are not so listed but are in global form, then in accordance with the procedures of the Depositary or (3) if such Securities are not so listed and are not in global form, then on a pro rata basis, although no Security of $2,000 in original principal amount or less will be redeemed in part.  Securities and portions of them the Trustee selects shall be in minimum principal amounts of $2,000 or a whole multiple of $1,000 in excess thereof.  Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption.  The Trustee shall notify the Company promptly of the Securities or portions of Securities to be redeemed.
		

		
			SECTION 3.03. Notice of Redemption.  At least 30 days but not more than 60 days before a date for redemption of Securities, the Company shall send, or cause to be sent (in the case of Securities held in book-entry form, by electronic transmission) a notice of redemption to each Holder of Securities to be redeemed at such Holder’s registered address or otherwise in accordance with the procedures of the Depositary.  Notwithstanding the above, when notice has to be given to a holder of a global security (including any notice of redemption) such notice shall be sufficiently given if given to the Depositary (or its designee) pursuant to the standing instructions from the Depositary or its designee, including by electronic mail in accordance with Applicable Procedures.  Notices to the Trustee may be given by email in PDF format.  Notices of redemption may be subject to one or more conditions precedent.
		

		
			The notice shall identify the Securities to be redeemed (including the Issue Date and the certificate number) and shall state:
		

		
			(1)         the redemption date;
		

		
			(2)         the redemption price;
		

		
			(3)         the name and address of the Paying Agent;
		

		
			(4)         that Securities called for redemption must be surrendered to the Paying Agent to collect the redemption price;
		

		
			(5)         if fewer than all the Outstanding Securities are to be redeemed, the identification and principal amounts of the particular Securities to be redeemed;
		

		
			(6)         that, unless the Company defaults in making such redemption payment, interest on Securities (or portion thereof) called for redemption ceases to accrue on and after the redemption date;
		

		
			(7)         the “CUSIP” number, ISIN or “Common Code” number, if any, printed on the Securities being redeemed;
		

		
			(8)         any conditions precedent to the redemption of the Securities; and
		

		
			
		

		
			

		 

		

			28

		

 

		

			 

		

		

		
			(9)         that no representation is made as to the correctness or accuracy of the “CUSIP” number, ISIN, or “Common Code” number, if any, listed in such notice or printed on the Securities.
		

		
			At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense.  In such event, the Company shall provide the Trustee with an Officer’s Certificate delivered five Business Days prior to notification of the Holders (unless the Trustee consents to a shorter period) requesting that the Trustee give such notice of redemption and containing the information required by this Section.
		

		
			SECTION 3.04.  Effect of Notice of Redemption.  Once notice of redemption is sent, Securities called for redemption become due and payable on the redemption date and at the redemption price stated in the notice, unless the conditions described in the notice of redemption have not been satisfied.  Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price stated in the notice, plus accrued interest to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the related interest payment date), and such Securities shall be canceled by the Trustee.  Failure to give notice or any defect in the notice to any Holder shall not affect the validity of the notice to any other Holder.
		

		
			SECTION 3.05. Deposit of Redemption Price.  On or prior to 11:00 a.m. Eastern time on the redemption date, the Company shall deposit with the Paying Agent (or, if the Company or any of its Subsidiaries is the Paying Agent, shall segregate and hold in trust) money sufficient to pay the redemption price of and accrued interest on all Securities or portions thereof to be redeemed on that date other than Securities or portions of Securities called for redemption which have been delivered by the Company to the Trustee for cancellation.
		

		
			SECTION 3.06. Securities Redeemed in Part.  Upon surrender of a Security that is redeemed in part, the Company shall execute and the Trustee shall authenticate for the Holder (at the Company’s expense) a new Security equal in principal amount to the unredeemed portion of the Security surrendered.
		

		
			SECTION 3.07. Open Market Repurchase.  The Company, Holdings and its other Subsidiaries may at any time and from time to time acquire Securities through redemption, by tender offer, open market purchases, negotiated transactions or otherwise, in accordance with applicable securities laws and regulations, so long as such acquisition does not otherwise violate the terms of this Indenture, upon such terms and at such prices as the Company, Holdings or its Subsidiaries may determine; provided that, any Securities acquired by the Company, Holdings and its other Subsidiaries shall promptly be surrendered to the Trustee for cancellation.  Any such acquisition shall not operate as or be deemed for any purpose to be a redemption unless the Company has expressly stated that it is exercising its redemption rights hereunder.
		

		
			SECTION 3.08. Optional Redemption.
		

		
			(i)          On or prior to July 15, 2021, the Company shall be entitled at its option to redeem the Securities, in whole or in part, at a redemption price equal to 100% of the principal amount of the Securities plus the Make-Whole Premium as of, and accrued and unpaid interest, if any, to (but not including), the redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).
		

		
			(ii)         After July 15, 2021, the Company shall be entitled at its option to redeem the Securities, in whole or in part, at the redemption prices applicable to the Securities (expressed as a percentage of principal amount of the Securities to be redeemed) set forth below, plus accrued and unpaid interest thereon to, but not including, the date of redemption (subject to the right of Holders on the relevant
		

		
			
		

		
			

		 

		

			29

		

 

		

			 

		

		

		
			record date to receive interest due on the relevant interest payment date) if redeemed during the periods indicated below:
		

		
			 
		

			
					
						Period

					
					
						Percentage

				
	
					
						July 16,  2021 to July 15, 2022

					
					
						102.938%

				
	
					
						July 16, 2022 to July 15, 2023

					
					
						101.469%

				
	
					
						July 16, 2023 and thereafter

					
					
						100.000%

				

		
			 
		

		
			(iii)       Any redemption pursuant to this Section 3.08 shall be made pursuant to Sections 3.01 through 3.06.
		

		
			SECTION 3.09. Mandatory Redemption.
		

		
			(i)          Commencing on January 15, 2019 and on each subsequent interest payment date, the Company shall redeem the Securities, in part, on a pro rata basis, in an aggregate principal amount equal to $41,250,000, at a redemption price equal to 100% of the portion of the principal amount of the Securities redeemed, plus accrued and unpaid interest thereon to, but not including, the date of redemption.
		

		
			(ii)         On the date that is the earlier of (x) 120 days after the occurrence of an Event of Loss and (y) three Business Days after the full amount of the insurance proceeds in connection with such Event of Loss are received by any Note Party or other Subsidiary of Holdings, the Company shall redeem 50% of the aggregate principal amount of the Outstanding Securities, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest thereon to, but not including, the date of redemption; provided that if the applicable Collateral Rig is replaced pursuant to a Collateral Rig Substitution before the applicable date specified in the immediately preceding subclauses (x) and (y), no redemption shall be required under this Section 3.09(b). For any Event of Loss that occurs following a redemption pursuant to this Section 3.09(b) or Section 3.09(c), the provisions of the preceding sentence shall apply in all respects, except that the Company shall redeem 100% of the then Outstanding Securities instead of 50% of the then Outstanding Securities.
		

		
			(iii)       On the date that is the earlier of (x) 90 days after (i) the termination of a Drilling Contract or (ii) the expiration of any period for which the dayrate under a Drilling Contract is at zero rate for 365 consecutive days and (y) one Business Day after the termination fee under such Drilling Contract is received by any Note Party or other Subsidiary of Holdings, the Company shall redeem 50% of the aggregate principal amount of the Outstanding Securities, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest thereon to, but not including, the date of redemption; provided that if such Drilling Contract is replaced pursuant to a Drilling Contract Substitution or the termination of such Drilling Contract is rescinded, in each case, before the applicable date specified in the immediately preceding subclauses (x) and (y), no redemption shall be required under this Section 3.09(c).  For any event described in subclauses (x) or (y) of this Section 3.09(c) that occurs following a redemption pursuant to Section 3.09(b) or this Section 3.09(c), the provisions of the preceding sentence shall apply in all respects, except that the Company shall redeem 100% of the then Outstanding Securities instead of 50% of the then Outstanding Securities.
		

		
			(iv)        Any redemption pursuant to this Section 3.09 shall be made pursuant to Sections 3.02, 3.04, 3.05 and 3.06, and the notices described in Sections 3.01 and 3.03 will be given as soon as practicable for any mandatory redemption pursuant to Section 3.09(b) or 3.09(c), but such notices shall not be required for any mandatory redemption pursuant to Section 3.09(a).  Notices of redemption pursuant to Section 3.09 may not be subject to conditions precedent.
		

		
			
		

		
			

		 

		

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			SECTION 3.10. Tax Redemption.  (i) The Securities shall be subject to redemption at any time, in whole but not in part, at a redemption price equal to 100% of the principal amount thereof together with accrued and unpaid interest to, but not including, the date fixed for redemption, upon the giving of a notice as described below, if the Company determines that:
		

		
			(1)         as a result of (A) any change in or amendment to the laws or treaties (or any regulations or rulings promulgated thereunder) of any Taxing Jurisdiction, or (B) any change in the official position regarding the application or interpretation of such laws, treaties, regulations or rulings by any legislative body, court, governmental agency or regulatory authority (including a holding by a court of competent jurisdiction), which change or amendment becomes effective on or after (i) June 27, 2018, or (ii) the date a party organized in a jurisdiction other than the Cayman Islands or Switzerland becomes the Company’s successor, the Company or such successor, as applicable, have or will become obligated to pay, on the next succeeding date on which interest is due, Additional Amounts pursuant to Section 13.01 with respect to any Security; or
		

		
			(2)         on or after (i) June 27, 2018, or (ii) the date a party organized in a jurisdiction other than the Cayman Islands or Switzerland becomes the Company’s successor, any action has been taken by any taxing authority of, or any decision has been rendered by a court of competent jurisdiction in, the Cayman Islands or Switzerland (or the jurisdiction of organization of the Company’s successor) or any political subdivision or taxing authority thereof or therein, including any of those actions specified in Section 3.10(a)(1), whether or not such action was taken or such decision was rendered with respect to the Company or such successor, as applicable, or any change, amendment, application or interpretation will be officially proposed, which, in any such case, in an Opinion of Counsel, will result in the Company, or the successor, as applicable, becoming obligated to pay, on the next succeeding date on which interest is due, Additional Amounts with respect to any Securities, and, in any such case, the Company, in its business judgment, determines that such obligation cannot be avoided by the use of reasonable measures available to the Company.
		

		
			(ii)         In the event that the Company elects to redeem the Securities pursuant to Section 3.10(a), the Company shall deliver to the Trustee an Officer’s Certificate stating that the Company is entitled to redeem the Securities pursuant to their terms, and the Trustee will accept and shall be entitled to rely absolutely and without further inquiry on such Officer’s Certificate as sufficient existence of the satisfaction of the conditions precedent described above, in which event it will be conclusive and binding on the Holders.  Any redemption pursuant to Section 3.10(a) shall be made pursuant to Sections 3.01, 3.04, 3.05 and 3.06, and the notice described in Section 3.03 will be given as soon as practicable.
		

		
			Article 4
		

		
			Covenants
		

		
			SECTION 4.01. Payment of Securities.  The Company shall promptly pay the principal of (and premium including the Make-Whole Premium, if any) and interest on the Securities on the dates and in the manner provided in the Securities and in this Indenture.  Principal, premium and interest shall be considered paid on the date due if the Trustee or the Paying Agent holds in accordance with this Indenture as of 11:00 a.m. Eastern time on the due date money sufficient to pay all principal and interest then due.
		

		
			The Company shall pay interest on overdue principal at the rate specified therefor in the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
		

		
			SECTION 4.02. Change of Control Repurchase Event.  (i) Upon the occurrence of a Change of Control Repurchase Event, unless all Securities have been called for redemption pursuant to Section 3.08 or 3.09, the Company shall be required to make an offer (a “Change of Control Offer”) to each Holder of
		

		
			
		

		
			

		 

		

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			the Securities to repurchase all or any part (in denominations of a minimum principal amount of $2,000 and integral multiples of $1,000 in excess thereof) of such Holder’s Securities at a repurchase price in cash equal to the Change of Control Payment.
		

		
			(ii)         Within 45 days following any Change of Control Repurchase Event, or, at the Company’s option, prior to any Change of Control, but after the public announcement of the Change of Control, the Company shall send, or cause to be sent, or when the Securities are in the form of Global Securities, send by electronic means pursuant to the Applicable Procedures a notice to each Holder of Securities, with a copy to the Trustee, describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event offering to repurchase the Securities on the Change of Control Payment Date specified in such notice and specifying:
		

		
			(1)         if applicable, that a Change of Control has occurred and that such Holder has the right to require the Company to purchase all or a portion of such Holder’s Securities at a repurchase price in cash equal to the Change of Control Payment and that all Securities timely tendered will be accepted for payment;
		

		
			(2)         the circumstances and relevant facts regarding such Change of Control;
		

		
			(3)         the instructions, as determined by the Company, consistent with this Section 4.02, that a Holder must follow in order to have its Securities purchased;
		

		
			(4)         the Change of Control Payment and the repurchase date, which date shall be a Business Day no earlier than 30 days and no later than 60 days from the date such notice is sent, other than as may be required by law (the “Change of Control Payment Date”);
		

		
			(5)         the CUSIP number for the Securities;
		

		
			(6)         that any Security not tendered will continue to accrue interest;
		

		
			(7)         that, unless the Company defaults in the payment of the Change of Control Payment, all Securities accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control Payment Date;
		

		
			(8)         that Holders electing to have any Securities purchased pursuant to a Change of Control Offer will be required to surrender such Securities to the Paying Agent at the address specified in the notice prior to the close of business on the second Business Day preceding the Change of Control Payment Date;
		

		
			(9)         that Holders will be entitled to withdraw their election referred to in clause (8) if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of Securities delivered for purchase, and a statement that such Holder is withdrawing his election to have the Securities purchased;
		

		
			(10)       that Holders whose Securities are being purchased only in part will be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered, which unpurchased portion will be equal to a minimum of $2,000 in principal amount or an integral multiple of $1,000 in excess thereof; and
		

		
			
		

		
			

		 

		

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			(11)       if such notice is sent prior to the date of consummation of the Change of Control, that the Change of Control Offer is conditioned on the Change of Control Repurchase Event occurring on or prior to the Change of Control Payment Date.
		

		
			(iii)       The Company shall cause the Change of Control Offer to remain open for at least 20 Business Days or such longer period as is required by applicable law.  The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Securities as a result of a Change of Control Repurchase Event.  To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.02, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section 4.02 by virtue of such conflict.
		

		
			(iv)        On the Change of Control Payment Date, the Company will, to the extent lawful:
		

		
			(1)         accept for payment all Securities or portions thereof properly tendered pursuant to the Change of Control Offer;
		

		
			(2)         deposit with the Trustee or the Paying Agent, as applicable, an amount equal to the Change of Control Payment in respect of all Securities or portions of Securities properly tendered; and
		

		
			(3)         deliver or cause to be delivered to the Trustee or the Paying Agent, as applicable, the Securities so accepted by the Company, for cancellation, together with an Officer’s Certificate stating the aggregate principal amount of Securities or portions of Securities being purchased by the Company.
		

		
			(v)         The Trustee or the Paying Agent, as applicable, will promptly send to each Holder of Securities properly tendered the Change of Control Payment for such Securities, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Security equal in principal amount to any unpurchased portion of any Securities surrendered; provided, that each new Security will be in a minimum principal amount of $2,000 and integral multiples of $1,000 in excess thereof.
		

		
			(vi)        The Company shall not be required to make a Change of Control Offer upon a Change of Control Repurchase Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.02 applicable to a Change of Control Offer made by the Company and such third party purchases all Securities properly tendered and not withdrawn under such Change of Control Offer.
		

		
			(vii)       In the event that Holders of not less than 90% of the aggregate principal amount of the Outstanding Securities accept the Change of Control Offer upon a Change of Control Repurchase Event and the Company purchases all of the Securities held by such Holders, the Company shall have the right, upon not less than 30 days’ nor more than 60 days’ prior notice, given not more than 30 days following the purchase pursuant to the Change of Control Offer, to redeem all of the Securities that remain Outstanding following such purchase at a redemption price equal to 101% of the aggregate principal amount of the Securities redeemed plus any accrued and unpaid interest on the Securities redeemed to, but not including, the date of redemption.
		

		
			(viii)     The provisions set forth in this Section 4.02 may be waived or modified with the written consent of the Holders of a majority in principal amount of the Securities.
		

		
			
		

		
			

		 

		

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			SECTION 4.03. Corporate Existence.  Each of the Company and Holdings will, and Holdings will cause the other Note Parties to, preserve and maintain its organizational existence, except (i) for mergers or other business combinations not prohibited by Sections 4.13 and 5.01, (ii) where the failure to preserve, renew or keep in full force and effect the existence of the Company, Holdings or any other Note Party would not reasonably be expected to have a Material Adverse Effect, (iii) in connection with the sale, lease, transfer or other disposition of assets (or equity interests) not otherwise prohibited by this Indenture or (iv) as otherwise expressly permitted in this Indenture.
		

		
			SECTION 4.04. Limitation on Liens.
		

		
			(i)          The Company shall not create, incur, assume or suffer to exist any Lien of any kind on any of its property or assets other than Liens arising by operation of law.
		

		
			(ii)         The Collateral Rig Owners shall not and Holdings shall not permit the Collateral Rig Operator or the Equity Pledgors to create, incur, assume or suffer to exist any Lien of any kind on any Collateral except for Permitted Collateral Liens.
		

		
			(iii)       TINC shall not, and shall not permit or allow any of its Subsidiaries to, create, assume or suffer to exist any Lien on any Restricted Property to secure any Indebtedness of TINC, any  of its Subsidiaries or any other Person (such Lien, the “Initial Lien”), without making effective provision whereby the Indenture and the Securities then Outstanding shall be directly secured equally and ratably with, or prior to, the Indebtedness secured by such Initial Lien for so long as such Indebtedness shall be so secured, except that the foregoing shall not prevent TINC or any of its Subsidiaries (other than the Company, the Collateral Rig Owners and the Collateral Rig Operator, which shall be governed by the restrictions set forth in clause (a) or (b) above, as applicable)  from creating, assuming or suffering to exist Liens of the following character:
		

		
			(1)         Liens existing on the Issue Date (other than Liens securing the Revolving Credit Facility on the Issue Date) and Liens under the Note Documents;
		

		
			(2)         Liens already existing on any particular Restricted Property at the time such Restricted Property is acquired,
		

		
			(3)         Liens already existing on Restricted Property of a corporation or other entity at the time it becomes a Subsidiary of TINC;
		

		
			(4)         Liens securing Indebtedness incurred pursuant to clause (3) or clause (10) of Section 4.06(a);
		

		
			(5)         Liens in favor of the United States of America or any State thereof or any other country, or any agency, instrumentality of political subdivision of any of the foregoing, to secure partial, progress, advance or other payments or performance pursuant to the provisions of any contract or statute, or any Liens securing industrial development, pollution control, or similar revenue bonds;
		

		
			(6)         Liens imposed by law, such as mechanics’, workmen’s, repairmen’s, materialmen’s, carriers’, warehousemen’s, vendors’ or other similar Liens arising in the ordinary course of business, or governmental (federal, state or municipal) Liens arising out of contracts for the sale of products or services by TINC or any of its Subsidiaries, or deposits or pledges to obtain the release of any of the foregoing;
		

		
			
		

		
			

		 

		

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			(7)         pledges or deposits under workmen’s compensation laws or similar legislation and Liens of judgments thereunder which are not currently dischargeable, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of money) or leases to which TINC or any of its Subsidiaries is a party, or deposits to secure public or statutory obligations of TINC or any of its Subsidiaries, or deposits in connection with obtaining or maintaining self-insurance or to obtain the benefits of any law, regulation or arrangement pertaining to unemployment insurance, old age pensions, social security or similar matters, or deposits of cash or obligations of the United States of America to secure surety, appeal or customs bonds to which TINC or any of its Subsidiaries is a party, or deposits in litigation or other proceedings such as, but not limited to, interpleader proceedings;
		

		
			(8)         Liens created by or resulting from any litigation or other proceeding which is being contested in good faith by appropriate proceedings, including Liens arising out of judgments or awards against TINC or any of its Subsidiaries with respect to which TINC or such Subsidiary is in good faith prosecuting an appeal or proceedings for review; or Liens incurred by TINC or any of its Subsidiaries for the purpose of obtaining a stay or discharge in the course of any litigation or other proceeding to which TINC or such Subsidiary is a party;
		

		
			(9)         Liens for taxes or assessments or governmental charges or levies not yet due or delinquent, or which can thereafter be paid without penalty, or which are being contested in good faith by appropriate proceedings;
		

		
			(10)       any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part of any Lien referred to in clauses (1) through (9) above, so long as the principal amount of the Indebtedness secured thereby does not exceed the principal amount of debt so secured at the time of the extension, renewal or replacement (except that, where an additional principal amount of debt is incurred to provide funds for the completion of a specific project, the additional principal amount, and any related financing costs, may be secured by the Lien as well) and the Lien is limited to the same property subject to the Lien so extended, renewed or replaced (plus improvements on the property); and
		

		
			(11)       any Lien not permitted by clauses (1) through (10) above securing Indebtedness, if after giving effect thereto, Aggregate Debt would not exceed an amount equal to 10.0% of Consolidated Net Tangible Assets measured at the time of incurrence of and after giving effect to such incurrence;
		

		
			provided that, notwithstanding the foregoing, at no time shall TINC or any Subsidiary thereof create, incur, assume or suffer to exist any Lien of any kind on any Collateral, except for Permitted Collateral Liens.
		

		
			SECTION 4.05. Limitation on Indebtedness.  (i) The Company shall not incur, assume or suffer to exist any Indebtedness other than (i) Indebtedness under the Note Documents and (ii) intercompany Indebtedness permitted by Section 4.06(a)(3).
		

		
			(ii)         The Collateral Rig Owners shall not incur, assume or suffer to exist any Indebtedness other than (i) Indebtedness under the Note Documents and (ii) Indebtedness (other than for borrowed money) incurred in the ordinary course of business in connection with the ownership and/or operation of a Collateral Rig.
		

		
			(iii)       Holdings shall not permit the Collateral Rig Operator to incur, assume or suffer to exist any Indebtedness other than (i) Indebtedness (other than for borrowed money) incurred in the ordinary course of business in connection with the operation of the Collateral Rigs and (ii) intercompany
		

		
			
		

		
			

		 

		

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			Indebtedness permitted by Section 4.06(a)(3) solely for the purpose of funding working capital and other operational matters.
		

		
			SECTION 4.06. Limitation on Subsidiary Indebtedness.  (i) TINC shall not permit any of its Subsidiaries to Incur, directly or indirectly, any Indebtedness other than:
		

		
			(1)         existing Indebtedness of a Subsidiary of TINC outstanding on the Issue Date (other than Indebtedness described in clauses (2) and (13) of this Section 4.06(a)), and any subsequent extensions, renewals or refinancings thereof so long as such Indebtedness is not increased in amount (other than amounts incurred to pay costs of such extension, renewal or refinancing), the scheduled maturity date thereof is not shortened (except to the extent such shortened maturity date is subsequent to the maturity date of the Securities (the “Maturity Date”)), any scheduled amortization of principal thereunder prior to the Maturity Date is not shortened, the interest rate per annum applicable thereto is not increased above the then prevailing market rates of interest for similar Indebtedness, and the payments thereunder prior to the Maturity Date are not increased;
		

		
			(2)         Indebtedness represented by the Securities or the Securities Guarantees;
		

		
			(3)         intercompany loans and advances between or among Holdings, TINC and the Subsidiaries of TINC; provided that (a) if the obligor on such intercompany loan or advance is the Company or a Guarantor, then such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Notes Obligations; and (b)(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than Holdings, TINC or a Subsidiary of TINC and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either Holdings, TINC or a Subsidiary of TINC, will be deemed, in each case, to constitute an incurrence of such Indebtedness by such Subsidiary that was not permitted by this clause (3);
		

		
			(4)         Indebtedness under any Interest Rate Protection Agreement or any Currency Rate Protection Agreements;
		

		
			(5)         Indebtedness (i) under unsecured lines of credit for overdrafts or for working capital purposes in foreign countries with financial institutions, and (ii) arising from the honoring by a bank or other Person of a check, draft or similar instrument inadvertently drawing against insufficient funds, all such Indebtedness not to exceed $300,000,000 in the aggregate at any time outstanding, provided that amounts under overdraft lines of credit or outstanding as a result of drawings against insufficient funds shall be outstanding for one (1) business day before being included in such aggregate amount;
		

		
			(6)         Indebtedness of a Person existing at the time such Person becomes a Member of the Consolidated Group or is merged, consolidated or amalgamated with or into TINC or any other Member of the Consolidated Group and not incurred in contemplation of such transaction, and extensions, renewals or refinancings thereof that do not increase the amount of such Indebtedness (other than amounts included to pay costs of such extension, renewal or refinancing);
		

		
			(7)         Indebtedness (i) under Performance Guaranties and Performance Letters of Credit, and (ii) with respect to letters of credit issued in the ordinary course of business;
		

		
			(8)         [Reserved];
		

		
			
		

		
			

		 

		

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			(9)         Indebtedness of any Priority Unsecured Notes Subsidiary Guarantor that is subordinate in right of payment to the “Securities Guarantee” (as defined in each of the 2023 Notes Indenture and the 2026 Notes Indenture) of such Priority Unsecured Notes Subsidiary Guarantor;
		

		
			(10)       Indebtedness Incurred to finance the acquisition, completion of construction and commencement of commercial operation, alteration, repair or improvement of any Rig (including (i) the purchase of the Equity Interests of any entity whose assets consist primarily of Rigs and/or other assets related thereto and (ii) any Guarantees of the Revolving Credit Facility provided to permit the Incurrence of such Indebtedness thereunder); provided that the Indebtedness was Incurred prior to, at the time of or within 12 months after that event and the aggregate principal amount of such Indebtedness does not exceed 85% of the price of such acquisition, construction, alteration, repair or improvement;
		

		
			(11)       Indebtedness Incurred by any Priority Unsecured Notes Subsidiary Guarantor in an aggregate amount at any one time outstanding under this clause (11) not to exceed the greater of (i) $2.25 billion and (ii) 10.0% of Consolidated Net Tangible Assets measured at the time of Incurrence of any such Indebtedness and after giving effect to such Incurrence;
		

		
			(12)       Indebtedness Incurred pursuant to Credit Facilities in an aggregate amount at any one time outstanding under this clause (12) not to exceed the greater of (i) $2.4 billion and (ii) 10.0% of Consolidated Net Tangible Assets, less the total Aggregate Debt outstanding at the time of such Incurrence (without double counting for Aggregate Debt Incurred under this clause (12)), measured at the time of Incurrence of any such Indebtedness and after giving effect to such Incurrence; and
		

		
			(13)       any extension, renewal, refunding, replacement or refinancing (collectively, a “refinancing”) of Indebtedness Incurred pursuant to Section 4.06(a) (1), (2), (10) and this clause (13), provided, that (i) such refinancing Indebtedness will not exceed the principal amount of Indebtedness so refinanced plus an amount necessary to pay fees and expenses, including premiums, related to such refinancing and (ii) the scheduled maturity date thereof is not shortened (except to the extent such shortened maturity date is subsequent to the Maturity Date), any scheduled amortization of principal thereunder prior to the Maturity Date is not shortened, the interest rate per annum applicable thereto is not increased above the then prevailing market rates of interest for similar Indebtedness, and the payments thereunder prior to the Maturity Date are not increased;
		

		
			provided that, notwithstanding the foregoing, at no time shall the Company, the Collateral Rig Owners or the Collateral Rig Operator be permitted to Incur Indebtedness other than pursuant to Section 4.05.
		

		
			(ii)         Indebtedness permitted by Section 4.06(a) need not be permitted solely by reference to one provision of Section 4.06(a) permitting such Indebtedness but may be permitted in part by one such provision and in part by one or more other provisions of Section 4.06(a) permitting such Indebtedness.  In the event that an item of Indebtedness meets the criteria of more than one of the types of Indebtedness described in Section 4.06(a), TINC shall be permitted, in its sole discretion, to divide, classify or reclassify all or a portion of such item of Indebtedness and only be required to include the amount of such Indebtedness in one of such clauses of Section 4.06(a).
		

		
			(iii)       The limitations on Subsidiary Indebtedness contained in Section 4.06(a) shall only apply during such time as the Securities are not rated Investment Grade by at least two of three of Moody’s, S&P or Fitch and no Default or Event of Default has occurred and is continuing under this Indenture.
		

		
			
		

		
			

		 

		

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			SECTION 4.07. Limitation on Sale and Lease Back Transactions.  Each of TINC and Holdings shall not enter into any Sale and Leaseback Transaction covering any Rig, nor permit any of its Subsidiaries so to do, unless either:
		

		
			(i)          TINC, Holdings or such Subsidiary would be entitled to incur Indebtedness, in a principal amount at least equal to the Value of such Sale and Leaseback Transaction, which is secured by Liens on the property to be leased (without equally and ratably securing the Outstanding Securities) because such Liens would be of such character that no violation of the provisions of Section 4.04 would result, or
		

		
			(ii)         TINC or Holdings, as applicable, during the six months immediately following the effective date of such Sale and Leaseback Transaction causes to be applied to (A) the acquisition of any Rig or (B) the voluntary retirement of Funded Debt (whether by redemption, defeasance, repurchase, or otherwise) an amount equal to the Value of such Sale and Leaseback Transaction;
		

		
			provided that, notwithstanding the foregoing, the Collateral Rig Owners may not enter into any Sale and Leaseback Transaction covering a Collateral Rig.
		

		
			SECTION 4.08. Maintenance of Property; Insurance.
		

		
			(i)          The Company shall and Holdings shall cause each of the Collateral Rig Owners and the Collateral Rig Operator to, keep all material property necessary to the proper conduct of the business of the Company, the Collateral Rig Owners and the Collateral Rig Operator in good working order and condition (ordinary wear and tear and loss or damage by casualty or condemnation excepted) with such exceptions as would not reasonably be expected to have a Material Adverse Effect.
		

		
			(ii)         Holdings shall cause the Collateral Rig Owners or the Collateral Rig Operator, as applicable, to:
		

		
			(1)         keep each Collateral Rig insured or cause a Subsidiary of Holdings to insure each Collateral Rig at no expense to the Trustee or the Collateral Agent with an insured value, in the aggregate for all Collateral Rigs, equal to or greater than 120% of the principal amount of the Outstanding Securities in regard to the risk indicated below:
		

		
			(A)        hull and machinery (including hull interest insurance, increased value insurance and freight interest insurances, if any); and
		

		
			(B)        war risks (including common conditions and exclusions) including terrorism, piracy, hijacking and confiscation;
		

		
			(2)         keep each Collateral Rig insured or cause a Subsidiary of Holdings to insure each Collateral Rig for protection and indemnity risks covering third party liabilities (including vessel pollution risks) as is customary and that a prudent owner of similar vessels would obtain; and
		

		
			(3)         keep each Collateral Rig insured or cause a Subsidiary of Holdings to insure each Collateral Rig with such other insurances as a prudent owner of similar vessels of the same age and type would obtain or would legally be required to obtain when operating in the same trade and geographic area as each Collateral Rig, as well as any insurances required to meet the requirements of the jurisdiction where each Collateral Rig is employed;
		

		
			
		

		
			

		 

		

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			all such insurances referred to in Section 4.08(b)(1) through (b)(3) (collectively, the “Insurances”), to be maintained in a manner consistent with the applicable Insurances in place on the Issue Date and consistent with insurance obtained by similarly situated vessel owners engaged in the same or similar business;
		

		
			(4)         effect the Insurances or cause or procure the same to be effected:
		

		
			(A)        in such amounts and upon such terms and with such deductibles as shipowners engaged in the same or similar business and similarly situated would deem commercially prudent under the circumstances; and
		

		
			(B)        through each Collateral Rig Owner’s marine insurance broker, which shall be an internationally recognized marine insurance broker such as but not limited to AON, Lockton, McGriff, JLT or Marsh (the “Owner’s Insurance Broker”), and reputable independent insurance companies and/or underwriters (including mutual insurance schemes and /or captive insurance schemes) in Europe, North America, the Far East and other established insurance markets, including TINC’s wholly-owned affiliated insurance company, except that the Insurances against protection and indemnity risks may be effected by the entry of the applicable Collateral Rig with protection and indemnity associations which are members of the International Group of Protection and Indemnity Associations (together with any successor association or replacement body of such associations, the “IGA”) or, if the IGA has disbanded and there is no successor or replacement body of associations, other leading protection and indemnity associations and the insurances against war risks may be effected by the entry of such Collateral Rig with leading war risks associations (hereinafter called the “Insurers”);
		

		
			(5)         renew or replace all such Insurances or cause or procure the same to be renewed or replaced before the relevant policies or contracts expire;
		

		
			(6)         duly and punctually pay, or cause duly and punctually to be paid, all premiums, calls, contributions or other sums that are due and payable in respect of all such Insurances, and duly and punctually to perform and observe or to cause duly and punctually to be performed and observed any other obligations and conditions under all such Insurances, except for such obligations and conditions the failure to comply with which would not result in the cancellation of such Insurances;
		

		
			(7)         procure that all policies, binders, cover notes or other instruments of the Insurances referred to in Section 4.08(b)(1)(A) and (B) above shall be taken out in the name of the applicable Collateral Rig Owner or the Collateral Rig Operator and shall incorporate a loss payable clause, which shall be in excess of $25,000,000, naming the Collateral Agent as loss payee prepared in compliance with the terms of the Assignment of Insurances along with standard letters of undertaking;
		

		
			(8)         upon request of the Trustee (acting at direction of Holders of not less than a majority in aggregate principal amount of the Outstanding Securities), procure that copies of all original instruments of Insurances shall be from time to time delivered to the Collateral Agent after receipt by the applicable Collateral Rig Owner or the Collateral Rig Operator thereof;
		

		
			(9)         not employ a Collateral Rig or suffer a Collateral Rig to be employed otherwise than in conformity in all material respects with the terms of all policies, bindings, cover notes or other instruments of the Insurances (including any warranties express or implied therein) without first obtaining the written consent of the Insurers to such employment (if required by such Insurers)
		

		
			
		

		
			

		 

		

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			and complying with such requirements as to extra premiums or otherwise as the Insurers may prescribe; and
		

		
			(10)       cause any proceeds in respect of the Insurances referred to in paragraphs (1) through (3) above to be paid to the applicable Collateral Rig Owner (subject to provisions as to named insureds, additional insureds and loss payees in favor of the Collateral Agent as required by this Section 4.08(b)).
		

		
			SECTION 4.09. Financial Reports and Other Information
		

		
			(i)          Holdings and the other Note Parties, as applicable, will furnish to the Trustee:
		

		
			(1)         not later than the earlier of (x) sixty days after the end of each of the first three fiscal quarters of each fiscal year of Holdings and (y) five days after the date Holdings is required to file (taking into account any extension of time, deemed filing date or safe harbor contemplated or provided for by Rule 12b-25, Rule 13a-11(c) and Rule 15d-11(c) under the Exchange Act) with the SEC its report on Form 10-Q with respect to each of such fiscal quarters, the consolidated balance sheet of the Consolidated Group as at the end of such fiscal quarter and the related consolidated statements of income and retained earnings and of cash flows for such fiscal quarter and for the portion of the fiscal year ended with the last day of such fiscal quarter, all of which shall be in reasonable detail or in the form filed with the SEC, and certified by the chief financial officer of Holdings, that they fairly present in all material respects the financial condition of the Consolidated Group as of the dates indicated and the results of their operations and changes in their cash flows for the periods indicated (publicly filing Holdings’ Form 10-Q with the SEC in any event will satisfy the requirements of this clause (1), and shall be deemed furnished and delivered on the date such information has been posted on the SEC website accessible through https://www.sec.gov/edgar/searchedgar/webusers.htm or such successor webpage of the SEC thereto; provided, however, the Trustee shall have no obligation whatsoever to determine whether or not such materials are available on such website));
		

		
			(2)         not later than the earlier of (x) 120 days after the end of each fiscal year of Holdings and (y) five days after the date Holdings is required to file (taking into account any extension of time, deemed filing date or safe harbor contemplated or provided for by Rule 12b-25, Rule 13a-11(c) and Rule 15d-11(c) under the Exchange Act) with the SEC its report on Form 10-K with respect to such fiscal year, the consolidated balance sheet of the Consolidated Group as at the end of such fiscal year and the related consolidated statements of income and retained earnings and of cash flows for such fiscal year and setting forth consolidated comparative figures as of the end of and for the preceding fiscal year, audited by an independent nationally-recognized accounting firm and in the form filed with the SEC (publicly filing Holdings’ Form 10-K with the SEC in any event will satisfy the requirements of this clause (2), and shall be deemed furnished and delivered on the date such information has been posted on the SEC website accessible through https://www.sec.gov/edgar/searchedgar/webusers.htm or such successor webpage of the SEC thereto; provided, however, the Trustee shall have no obligation whatsoever to determine whether or not such materials are available on such website));
		

		
			(3)         not later than 75 days after the end of each of the first three fiscal quarters of each fiscal year of Holdings, the unaudited combined balance sheet of the Collateral Rig Owners and the Collateral Rig Operator as at the end of such fiscal quarter and the related consolidated statements of income for such fiscal quarter and for the portion of the fiscal year ended with the last day of such fiscal quarter, which shall be prepared in a manner consistent with Holdings’
		

		
			
		

		
			

		 

		

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			quarterly internal reporting processes and will generally be based on GAAP principles but need not be prepared in accordance with GAAP; and
		

		
			(4)         not later than 120 days after the end of each fiscal year of Holdings, the unaudited combined balance sheet of the Collateral Rig Owners and the Collateral Rig Operator as at the end of such fiscal year and the related consolidated statements of income for such fiscal year, which shall be prepared in a manner consistent with Holdings’ annual internal reporting processes and will generally be based on GAAP principles but need not be prepared in accordance with GAAP.
		

		
			(ii)         Compliance Certificates.  The Company shall deliver to the Trustee and the Collateral Agent, concurrently with each delivery of financial statements required by Section 4.09(a)(3) and (a)(4), a certificate from an Officer of the Company (in his or her capacity as such and not in his or her individual capacity) stating (i) that a review of the activities of the Company during the preceding fiscal quarter or fiscal year, as the case may be, has been made under the supervision of the signing Officer with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under this Indenture and the other Note Documents, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge, that the Company has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and the other Note Documents and no Default or Event of Default exists (or, if a Default or Event of Default exists, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes to take with respect thereto) and (ii) either (x) that all action has been taken with respect to the recording, filing, re-recording and refiling of this Indenture and all amendments, supplemental indentures, financing statements, continuation statements and other documents, as are necessary to maintain the perfected Liens created under the Security Documents under applicable law and reciting the details of such action or referring to prior such certificates in which such details are given or (y) that no such action is necessary to maintain such Liens.  In addition, such certificate shall include a reasonably detailed calculation of the Collateral Rig Leverage Ratio and the Total Leverage Ratio for such period and whether Holdings is in compliance with the covenants set forth in Sections 4.14 and 4.15.  If such certificate states that the Total Leverage Ratio as of the last day of the relevant fiscal quarter of Holdings exceeds 10.00:1.00, the Company shall notify the Collateral Agent to, and the Collateral Agent shall promptly, instruct the relevant depositary bank under the control agreements or Account and Receivables Pledge Agreement or Account Pledge Agreement, as applicable, for the Earnings Account and Bareboat Accounts to institute a Blocked Period (as defined in Section 4.15) (such instruction, a “Blocking Notice”).  If such certificate states that no Default or Event of Default exists and the Total Leverage Ratio as of the last day of the relevant fiscal quarter of Holdings is equal to or less than 10.00:1.00, the Company shall notify the Collateral Agent to, and the Collateral Agent shall promptly, instruct the relevant depositary bank under the control agreements or Account and Receivables Pledge Agreement or Account Pledge Agreement, as applicable, for the Earnings Account and Bareboat Accounts to revoke any then existing Blocked Period and Blocking Notice.
		

		
			(iii)       Statement of Dayrates.  Holdings shall disclose dayrates under the Drilling Contract in the Fleet Status Report at least quarterly.
		

		
			(iv)        Revenue Efficiency Table.  Within the time periods required for delivery of financial statements required by Section 4.09(a)(1) and (a)(2) after the end of each fiscal quarter of each fiscal year of Holdings, the Company shall deliver to the Trustee a revenue efficiency table that includes each Collateral Rig within a category thereof unless such information has been included in the quarterly SEC filings of Holdings.
		

		
			(v)         Insurance Schedule.  Within 30 days after each insurance renewal, the Company shall deliver to the Trustee an annual schedule of insurance coverage with respect to the Collateral Rig.
		

		
			
		

		
			

		 

		

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			(vi)        Maintenance of Datasite.  The Company shall maintain, or cause to be maintained, an internet accessible datasite that can be accessed by beneficial owners of the Securities or prospective purchasers of beneficial ownership of the Securities (subject to reasonable confidentiality restrictions), which shall contain all of the information required to be delivered pursuant to clauses (a), (b), (d) and (e) of this Section 4.09 (unless otherwise publicly available), the Offering Memorandum and a summary of the projections made available to the initial purchaser of the Securities, based upon the material assumptions and other projections previously provided to the initial purchaser of the Securities, which summary shall be available on such datasite until such projections no longer constitute material non-public information.  Such datasite may be password protected so long as such password is made available to beneficial owners of the Securities and bona fide prospective purchasers of beneficial ownership of the Securities.  Access to such datasite may be limited to QIBs and “non-U.S. persons” within the meaning of the rules and regulations under the Securities Act.  Holdings and the Company agree that if any information included on such datasite would constitute, within the meaning of the rules and regulations of  the Exchange Act, material non-public information with respect to any securities of Holdings or any of its Subsidiaries, other than the Securities, Holdings and the Company shall promptly publicly disclose such information such that it shall not constitute material non-public information.
		

		
			(vii)       Notice of Default.          So long as any of the Securities are Outstanding, the Company will deliver to the Trustee, within 30 days after any Officer of the Company becoming aware of the occurrence of any Default or Event of Default that has not been cured, a written statement specifying such Default or Event of Default and what action the Company is taking or proposing to take with respect thereto.
		

		
			(viii)     Delivery of reports, information and documents to the Trustee under this Section 4.09 (other than Section 4.09(b))  is for informational purposes only and the Trustee’s receipt of such shall not constitute actual or constructive knowledge or notice of any information contained therein or determinable from the information contained therein, including the Company’s compliance or non-compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates).  The Trustee shall not be obligated to monitor or confirm, on a continuing basis or otherwise, the Company’s compliance with the covenants described herein or to determine whether such reports, information or other documents have been filed with the SEC or EDGAR or posted on any website or datasite under this Indenture, or participate in any conference calls.
		

		
			SECTION 4.10. Trustee Inspection Rights.  Upon reasonable notice from the Trustee (acting at direction of Holders of not less than a majority in aggregate principal amount of the Outstanding Securities), Holdings will cause the Company, the Collateral Rig Owners and the Collateral Rig Operator to permit the Trustee (and such Persons acting for the Trustee as the Trustee may reasonably designate) during normal business hours at the Company’s sole expense, to visit and inspect any of the properties of the Company or the Collateral Rig Owners or, in the case of the Collateral Rig Operator, the Collateral Rigs, to examine all of their books and records (with respect to the Collateral Rig Operator, solely with respect to a Collateral Rig), to make copies and extracts therefrom (subject to reasonable confidentiality restrictions), and to discuss their respective affairs, finances and accounts (with respect to the Collateral Rig Operator, solely with respect to a Collateral Rig) with their respective officers and independent public accountants (and by this provision each of the Company, the Collateral Rig Owners and Holdings, on behalf of the Collateral Rig Operator, authorizes such accountants to discuss with the Trustee (and such Persons acting for the Trustee as the Trustee may reasonably designate) the affairs, finances and accounts of the Company and the Collateral Rig Owners and with respect to the Collateral Rig Operator, solely with respect to a Collateral Rig), all as often, and to such extent, as may be reasonably requested.  The chief financial officer of Holdings and/or his or her designee shall be afforded the opportunity to be present at any meeting of the Trustee and such accountants.
		

		
			
		

		
			

		 

		

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			SECTION 4.11. Conduct of Business.  (i) The Company shall not conduct, transact or otherwise engage in any material business or operations other than (i) actions limited to those necessary to repay the Notes Obligations; (ii) actions related to the ownership of any intercompany loans or receivables held by the Company; and (iii) payment of guarantee fees as Holdings or its Subsidiaries in their  reasonable discretion determines are required for tax purposes.
		

		
			(ii)         The Collateral Rig Owners shall not conduct, transact or otherwise engage in any material business or operations other than (i) actions reasonably related to ownership and/or operation of the Collateral Rigs; (ii) actions reasonably related to obligations under the Bareboat Charters; (iii) actions reasonably related to the maintenance of the Bareboat Accounts and the pledge of the Bareboat Accounts to the Collateral Agent; (iv) actions reasonably related to transfers of the Collateral Rig in accordance with Section 4.29 and so long as the Collateral and Guaranty Requirements are satisfied, immediately after giving effect to such transfer; (v) making loans to Affiliates; (vi) receipt from the Company of guarantee fees as Holdings or its Subsidiaries in their reasonable discretion determines are required to be paid for tax purposes; and (vii) contributing funds to the Company.
		

		
			(iii)       Holdings shall not permit the Collateral Rig Operator to conduct, transact or otherwise engage in any material business or operations other than (i) actions reasonably related to the operation of the Collateral Rigs; (ii) actions reasonably related to obligations under the Drilling Contracts or the Bareboat Charters; (iii) actions reasonably related to the maintenance of the Earnings Accounts and the pledge of Earnings Accounts to the Collateral Agent; (iv) making loans to and borrowing loans from Affiliates in accordance with Section 4.05(c); (v) actions reasonably related to transfers of the Bareboat Charters and the Drilling Contracts in accordance with Section 4.29 and so long as the Collateral and Guaranty Requirements are satisfied, immediately after giving effect to such transfer; and (vi) receipt from the Company of guarantee fees as Holdings or its Subsidiaries in their reasonable discretion determines are required to be paid for tax purposes.
		

		
			SECTION 4.12. Use of Proceeds; Margin Regulations; Company Activities.
		

		
			(i)          Use of Proceeds.  The proceeds of the Securities shall be used by the Company to make one or more intercompany loans to TINC or other non-Swiss Affiliates of TINC for the purpose of partially financing (or partially refinancing Indebtedness previously incurred to finance the construction or acquisition of the Collateral Rigs prior to the date that such Collateral Rigs were acquired by Members of the Consolidated Group) the construction or acquisition of the Collateral Rigs and to fund the Debt Service Reserve Account to be maintained by the Trustee in accordance with the terms of Section 7.10.  No proceeds of the Securities shall be loaned to Holdings or any other Swiss Group Company or be otherwise used in a manner which would constitute a "use of proceeds in Switzerland" (Mittelverwendung in der Schweiz), as interpreted by the Swiss Federal Tax Administration for purposes of Swiss Withholding Tax.
		

		
			(ii)         Margin Stock.  Neither the Company nor Holdings shall, and Holdings shall not permit any Note Party or any other Member of the Consolidated Group to, (i) engage in the business of extending credit for the purpose of purchasing or carrying margin stock in violation of Regulations T, U or X of the Board of Governors of the Federal Reserve System or (ii) use any proceeds of the Securities for a purpose which violates Regulations T, U or X of the Board of Governors of the Federal Reserve System.
		

		
			(iii)       Company Activities; Limitations on Use of Proceeds.  The Company shall (i) maintain its incorporation, day-to-day management and all board of directors meetings outside of Switzerland and (ii) comply at all times with all conditions and requirements of the Swiss Federal Tax Administration so that no proceeds of the Securities will be used in a manner constituting a use of proceeds (Mittelverwendung in der Schweiz) as interpreted by the Swiss Federal Tax Administration for purposes of Swiss withholding tax unless and until either (1) use in Switzerland is permitted under the Swiss taxation
		

		
			
		

		
			

		 

		

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			laws in force from time to time without payments in respect of the Securities becoming subject to withholding or deduction for Swiss Withholding Tax as a consequence of such use of proceeds in Switzerland or (2) the Swiss Federal Tax Administration has confirmed by way of a tax ruling that any such use of proceeds in Switzerland does not result in payments in respect of the Securities becoming subject to withholding or deduction for Swiss Withholding Tax.
		

		
			SECTION 4.13. Restrictions on Fundamental Changes.
		

		
			(i)          Holdings will not, in any transaction or series of transactions, consolidate with or merge into or engage in a scheme of arrangement qualifying as an amalgamation with any Person, or sell, lease, convey, transfer or otherwise dispose of all or substantially all of its assets to any Person (each such transaction, a “Fundamental Change”), unless:
		

		
			(1)         either (x) Holdings shall be the continuing Person or (y) the Person (if other than Holdings)  formed by such consolidation or into which Holdings is merged or amalgamated, or to which such sale, lease, conveyance, transfer or other disposition is made (the “Holdings Successor”) (i) shall become a Guarantor hereunder and assume by supplemental indenture, assumption agreement or otherwise, in each case in form and substance reasonably satisfactory to the Trustee, all obligations of Holdings hereunder, (ii) each Collateral Rig Owner is the direct or indirect wholly-owned Subsidiary of the Holdings Successor and the Collateral Rig Operator is the direct or indirect Wholly-Owned Subsidiary of the Holdings Successor, in each case, immediately after giving effect to such Fundamental Change and (iii) the Collateral and Guaranty Requirements in respect of each Collateral Rig remain satisfied immediately after giving effect to such Fundamental Change;
		

		
			(2)         immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom; and
		

		
			(3)         the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that the transaction and any supplemental indenture, assumption agreement or other agreement (if any) required under Section 4.13(a)(1) comply with this Indenture.
		

		
			(ii)         TINC will not, in any transaction or series of transactions, consummate a Fundamental Change, unless:
		

		
			(1)         either (x) TINC shall be the continuing Person or (y) the Person (if other than TINC)  formed by such consolidation or into which TINC is merged or amalgamated, or to which such sale, lease, conveyance, transfer or other disposition is made (the “TINC Successor”) (i) shall become a Guarantor hereunder and assume by supplemental indenture, assumption agreement or otherwise, in each case in form and substance reasonably satisfactory to the Trustee, all obligations of TINC hereunder, (ii) each Collateral Rig Owner is the direct or indirect wholly-owned Subsidiary of the TINC Successor and the Collateral Rig Operator is the direct or indirect Wholly-Owned Subsidiary of the TINC Successor, in each case, immediately after giving effect to such Fundamental Change and (iii) the Collateral and Guaranty Requirements in respect of each Collateral Rig remain satisfied immediately after giving effect to such Fundamental Change;
		

		
			(2)         immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom; and
		

		
			
		

		
			

		 

		

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			(3)         the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that the transaction and any supplemental indenture, assumption agreement or other agreement (if any) required under Section 4.13(b)(1) comply with this Indenture.
		

		
			(iii)       Each Collateral Rig Owner will not, in any transaction or series of transactions, consummate a Fundamental Change, unless:
		

		
			(1)         either (x) such Collateral Rig Owner immediately prior to consummation of such Fundamental Change shall be the continuing Person or (y) the Person (if other than such Collateral Rig Owner immediately prior to consummation of such Fundamental Change) formed by such consolidation or into which such Collateral Rig Owner immediately prior to consummation of such Fundamental Change is merged or amalgamated, or to which such sale, lease, conveyance, transfer or other disposition is made (the “Successor Collateral Rig Owner”) (i) is a Subsidiary of Holdings and TINC (or their respective successors) that is in compliance with Section 4.11(b) and Section 4.29, (ii) is organized under the laws of a Permitted Jurisdiction, (iii) shall become a Collateral Rig Owner, a Guarantor and a Collateral Grantor hereunder and assume by supplemental indenture, assumption agreement or otherwise, in each case in form and substance reasonably satisfactory to the Trustee, all obligations of a Collateral Rig Owner under the applicable Note Documents and (iv)  the Collateral and Guaranty Requirements in respect of each Collateral Rig remain satisfied immediately after giving effect to such Fundamental Change;
		

		
			(2)         immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom; and
		

		
			(3)         the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that the transaction and any supplemental indenture, assumption agreement or other agreement (if any) required under Section 4.13(c)(1) comply with this Indenture.
		

		
			(iv)        Holdings shall not permit the Collateral Rig Operator to, in any transaction or series of transactions, consummate a Fundamental Change, unless:
		

		
			(1)         either (x) Collateral Rig Operator immediately prior to consummation of such Fundamental Change shall be the continuing Person or (y) the Person (if other than the Collateral Rig Operator immediately prior to consummation of such Fundamental Change) formed by such consolidation or into which the Collateral Rig Operator immediately prior to consummation of such Fundamental Change is merged or amalgamated, or to which such sale, lease, conveyance, transfer or other disposition is made (the “Successor Collateral Rig Operator” and together with the Holdings Successor, the TINC Successor and the Successor Collateral Rig Owner, each a “Note Party Successor”) (i) is a Subsidiary of Holdings and TINC (or their respective successors) that is in compliance with Section 4.29, (ii) is organized under the laws of a Permitted Jurisdiction, (iii) is a party to each Drilling Contract (including, for the avoidance of doubt, pursuant to clause (b) of the definition of “Drilling Contract”), (iv) shall become the Collateral Rig Operator and a Collateral Grantor hereunder, and assume by supplemental indenture, assumption agreement or otherwise, in each case in form and substance reasonably satisfactory to the Trustee, all obligations of the Collateral Rig Operator under the applicable Note Documents and (v) the Collateral and Guaranty Requirements in respect of each Collateral Rig remain satisfied immediately after giving effect to such Fundamental Change;
		

		
			(2)         immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom; and
		

		
			
		

		
			

		 

		

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			(3)         the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that the transaction and any supplemental indenture, assumption agreement or other agreement (if any) required under Section 4.13(d)(1) comply with this Indenture.
		

		
			(v)         For the avoidance of doubt, (x) the term “merger” as used in this Section 4.13 includes an amalgamation under Cayman Islands law, and the term “all or substantially all of its assets”, as used in this Section 4.13, with respect to any Note Party, shall be computed on a consolidated basis, (y) entry into a drilling contract or bareboat charter shall not constitute a sale, lease, conveyance, transfer or other disposition subject to this Section 4.13 and (z) a reference to “series of transactions” in this Section 4.13 shall mean a series of related transactions.
		

		
			(vi)        Upon any Fundamental Change of any Note Party described in the preceding clauses (a) through (d) in which the applicable Note Party is not the continuing Person, or the Person to which any sale, lease, conveyance, transfer or other disposition is made in accordance with this Section 4.13, the applicable Note Party Successor shall succeed to, and be substituted for, and may exercise every right and power of the applicable predecessor Note Party under this Indenture, the Securities and the other applicable Note Documents with the same effect as if such Note Party Successor had been named as the applicable Note Party herein and therein and the predecessor Note Party, in the case of a sale, transfer, conveyance, or other disposition, shall be released from all obligations under this Indenture, the Securities and the other Note Documents, provided, that in the case of a lease of all or substantially all its assets, the predecessor Note Party will not be released from its obligations under this Indenture, the Securities or other applicable Note Documents.
		

		
			SECTION 4.14. Collateral Rig Leverage Ratio.  The Company will not permit the Collateral Rig Leverage Ratio as of the last day of any fiscal quarter of Holdings ending during the periods specified below to exceed the corresponding ratio set forth below:
		

			
					
						Fiscal Quarter Ending

					
					
						    

					
					
						Maximum

				
	
					
						 

					
					
						 

					
					
						Collateral Rig Leverage Ratio

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						After the Issue Date through March 31, 2019

					
					
						 

					
					
						6.00:1.00

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						On April 1, 2019 through March 31, 2021

					
					
						 

					
					
						4.50:1.00

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						On April 1, 2021 through March 31, 2023

					
					
						 

					
					
						3.50:1.00

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Thereafter

					
					
						 

					
					
						3.00:1.00

				

		
			 
		

		
			Neither the Trustee nor the Collateral Agent shall be obligated to monitor or confirm, on a continuing basis or otherwise, the Company’s compliance with this Section 4.14 (as to which the Trustee and the Collateral Agent are entitled to rely exclusively on the quarterly compliance certificate delivered by the Company pursuant to Section 4.09(b)).
		

		
			SECTION 4.15. Total Leverage Ratio.
		

		
			(i)          If the Total Leverage Ratio exceeds 10.00:1.00 as of the last day of any fiscal quarter of Holdings, then all amounts on deposit in the Bareboat Accounts and the Earnings Account and all future amounts deposited into the Bareboat Accounts or the Earnings Account shall be swept and deposited into accounts established in the name of the Collateral Agent after the Collateral Agent delivers
		

		
			
		

		
			

		 

		

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			a Blocking Notice (as defined in Section 4.09(b)) and the relevant depositary bank restricts access by each Collateral Rig Owner and Collateral Rig Operator to the applicable Bareboat Account and Earnings Account, respectively, until such Blocking Notice is revoked in accordance with Section 4.09(b) (each such period, a “Blocked Period”).  During any Blocked Period, the Company may request (not more frequently than once per week) disbursements and withdraw from such accounts of the Collateral Agent by executing and delivering a Blocked Period Withdrawal Certificate the form of which is attached hereto as Appendix O for any amounts (a) necessary to make required payments of principal and interest on the Securities, (b) necessary to maintain the Debt Service Reserve, (c) utilized in connection with the ownership and/or operation of the Collateral Rigs (including overhead allocations as well as direct costs) and (d) utilized in connection with the performance of the Drilling Contracts.  In addition, during any Blocked Period, the Company may request disbursements and withdraw from such accounts of the Collateral Agent by executing and delivering a Blocked Period Withdrawal Certificate requesting the disbursement of an amount such that after giving effect to such disbursement, the aggregate amount of funds held by the Collateral Agent in such accounts plus the amount in the Debt Service Reserve Account exceeds the principal amount of the Outstanding Securities.  For the avoidance of doubt, during any Blocked Period, Holdings may continue to cause the Collateral Rig Operator to pay amounts due under the Bareboat Charters into the Bareboat Accounts, and the Collateral Rig Owners may continue to pay amounts due under the Bareboat Charters, if any, into the Earnings Account by delivering a Blocked Period Withdrawal Certificate. At any time during which the Total Leverage Ratio is equal to or less than 10.00:1.00 as of the last day of any fiscal quarter of Holdings and no Default or Event of Default exists, the Collateral Rig Owners and the Collateral Rig Operator shall have unrestricted access to the Bareboat Accounts or the Earnings Account, as applicable, subject to the conditions set forth in Section 4.18 and the Collateral Agent’s revocation of such Blocking Notice as described in Section 4.09(b) if any Blocked Period had previously been in effect.  The Company shall deliver to the Trustee and the Collateral Agent written notice of the commencement and termination of a Blocked Period, which shall be included in the quarterly compliance certificate delivered by the Company pursuant to Section 4.09(b).  Neither the Trustee nor the Collateral Agent shall be obligated to monitor or confirm, on a continuing basis or otherwise, the Company’s compliance with this Section 4.15 (as to which the Trustee and the Collateral Agent are entitled to rely exclusively on the quarterly compliance certificate delivered by the Company pursuant to Section 4.09(b)).
		

		
			(ii)         Concurrently with the execution of this Indenture, the Company shall deliver to the Collateral Agent Appendix N, which contains the authorized signer designations in Part A thereof.
		

		
			(iii)       The Collateral Agent shall confirm each funds transfer instruction received in the name of the Company by means of the security procedure selected by the Company and communicated to the Collateral Agent through a signed certificate in the form of Appendix N attached hereto, which upon receipt by the Collateral Agent shall become a part of this Indenture. Once delivered to the Collateral Agent, Appendix N may be received or rescinded only by a writing signed by an authorized representative of the Company. Such revisions or rescissions shall be effective only after actual receipt and following such period of time as may be necessary to afford the Collateral Agent a reasonable opportunity to act on it. If a revised Appendix N or a rescissions of an existing Appendix N is delivered to the Collateral Agent by an entity that is a successor-in-interest to the Company, such document shall be accompanied by additional documentation satisfactory to the Collateral Agent showing that such entity has succeeded to the rights and responsibilities of the Company under this Indenture.
		

		
			(iv)        The Company understands the Collateral Agent’s inability to receive or confirm funds transfer instructions pursuant to the security procedures selected by the Company may result in a delay in accomplishing such funds transfer, and agree that the Collateral Agent shall not be liable for any loss caused by any such delay.
		

		
			SECTION 4.16. [Reserved].
		

		
			
		

		
			

		 

		

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			SECTION 4.17. Collateral Rig Classifications; Operation of Collateral Rig; Registry, Name and Flag.
		

		
			(i)          Holdings shall cause the Collateral Rig Operator to operate the Collateral Rigs in a manner consistent with reasonable industry practice and to keep the Collateral Rigs in a good working order and condition (ordinary wear and tear and loss or damage by casualty or condemnation excepted) so as to ensure that each Collateral Rig is classified by an Acceptable Classification Society, at minimum at the same standard of classification as set forth in the classification certificate as in effect on the Issue Date or other highest classification as is applicable for rigs of its age and type with such classification society, free of any overdue conditions affecting the classification of the Collateral Rig for which no extension has been granted by the Acceptable Classification Society; provided that temporary lapses of such classification as may from time to time arise as a result of the normal operation of a Collateral Rig shall not be deemed to be a breach of this Section 4.17 so long the applicable Collateral Rig Owner or the Collateral Rig Operator is using commercially reasonable efforts to remedy such lapses and actually promptly remedies such lapses.
		

		
			(ii)         Holdings shall cause the Collateral Rig Operator to (i) make or cause to be made all repairs to or replacement of any damaged, worn or lost parts or equipment such that the value of each Collateral Rig will not be materially impaired and (ii) except as otherwise contemplated by this Indenture, not remove any material part of, or item of, equipment owned by the Note Parties installed on each Collateral Rig except in the ordinary course of the operation and maintenance of such Collateral Rig or unless (x) the part or item so removed is forthwith replaced by a suitable part or item which is in similar condition as or better condition than the part or item removed, is free from any Lien (other than Permitted Collateral Liens) in favor of any Person other than the Collateral Agent and becomes, upon installation on such Collateral Rig, the property of the Note Parties and subject to the security constituted by the Collateral Rig Mortgage or (y) the removal, individually or in the aggregate, will not materially diminish the value of such Collateral Rig.
		

		
			(iii)       Each Collateral Rig Owner shall, or Holdings shall cause the Collateral Rig Operator to, promptly pay and discharge all tolls, dues, taxes, assessments, governmental charges, fines, penalties, debts, damages and liabilities whatsoever in respect of the applicable Collateral Rig which have given or may give rise to maritime or possessory Liens (other than Permitted Collateral Liens) on, or claims enforceable against, such Collateral Rig other than any of the foregoing being contested in good faith and diligently by appropriate proceedings, and, in the event of arrest of such Collateral Rig pursuant to legal process, or in the event of its detention in exercise or purported exercise of any such Lien or claim as aforesaid, procure, if reasonably possible, the release of such Collateral Rig from such arrest or detention forthwith upon receiving notice thereof by providing bail or otherwise as the circumstances may require.
		

		
			(iv)        Holdings shall cause the Collateral Rig Operator to maintain, or cause to be maintained by the charterer or lessee of a Collateral Rig, a valid Certificate of Financial Responsibility (Oil Pollution) issued by the United States Coast Guard pursuant to the Federal Water Pollution Control Act to the extent that such certificate may be required by applicable legal requirements for such Collateral Rig and such other similar certificates as may be required in the course of the operations of such Collateral Rig pursuant to the International Convention on Civil Liability for Oil Pollution Damage of 1969, or other applicable legal requirements.
		

		
			(v)         Each Collateral Rig Owner will not, and Holdings will not permit the Collateral Rig Operator or any of its Subsidiaries to, engage in the following undertakings:
		

		
			(i)          without giving prior written notice thereof to the Collateral Agent and the Trustee and otherwise in compliance with this Indenture, change the registered owner, name, or official number, as the case may be, of the class of a Collateral Rig;
		

		
			
		

		
			

		 

		

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			(ii)         bareboat charter register a Collateral Rig, other than in the Acceptable Flag Jurisdiction in which such Collateral Rig is currently flagged; or
		

		
			(iii)       change the registered flag registry (except in connection with a Flag Jurisdiction Transfer) or classification society of a Collateral Rig to a classification society that is not an Acceptable Classification Society, as the case may be.
		

		
			SECTION 4.18. Deposit of Earnings.
		

		
			(i)          Holdings shall cause the Collateral Rig Operator to cause all Earnings to be deposited into the Earnings Account, and subject to Section 4.15 so long as (i) there does not exist an Event of Default for which notice has been received from the Collateral Agent of its intent to exercise its remedies in accordance with this Indenture and (ii) none of Holdings or TINC or any their respective Subsidiaries have commenced or become the subject of an insolvency proceeding, the Collateral Rig Operator shall have full control of the funds within the Earnings Account.  Without limiting Holdings’ or a Collateral Rig Owner’s obligations in respect of this Section 4.18, Holdings agrees that, in the event any Note Party receives any “Earnings Collateral” (as defined in the Assignment of Earnings) or “Insurance Collateral” (as defined in the Assignment of Insurances), or any such Earnings Collateral or Insurance Collateral are deposited other than in the Earnings Account, Holdings shall, or shall cause such other Note Party to, promptly deposit all such proceeds into an Earnings Account.
		

		
			(ii)         Each Collateral Rig Owner shall cause all earnings, hires, freights, income and other sums payable to such Collateral Rig Owner in respect of the applicable Collateral Rig under a Bareboat Charter or otherwise derived from a Bareboat Charter to be deposited into the applicable Bareboat Account, and subject to Section 4.15 so long as (i) there does not exist an Event of Default for which notice has been received from the Collateral Agent of its intent to exercise its remedies in accordance with this Indenture and (ii) none of Holdings or TINC or any their respective Subsidiaries have commenced or become the subject of an insolvency proceeding, such Collateral Rig Owner shall have full control of the funds within the Bareboat Account.
		

		
			SECTION 4.19. Debt Service Reserve.  The Company shall not permit the balance in the Debt Service Reserve Account to, at any time, be less than the amount of the Debt Service Reserve.  The Company shall provide written notice to the Trustee if the balance in the Debt Service Reserve Account is less than the amount of the Debt Service Reserve.
		

		
			SECTION 4.20. Limitation on Dividends.  (a) The Company and the Collateral Rig Owners shall not declare or pay any dividend or make any other similar payment or distribution on account of their respective Equity Interests (including, without limitation, any payment in connection with any merger, consolidation or amalgamation of the Company or a Collateral Rig Owner) or to the direct or indirect holders of its Equity Interests in their capacity as such, except, in the case of the Collateral Rig Owners, distributions to the Company for purposes of making payments on the Notes (including funding the Debt Service Reserve Account).
		

		
			(b)         Holdings shall not permit the Collateral Rig Operator to declare or pay any dividend or make any other similar payment or distribution on account of its Equity Interests (including, without limitation, any payment in connection with any merger, consolidation or amalgamation of the Collateral Rig Operator) or to the direct or indirect holders of its Equity Interests in their capacity as such, other than de minimis dividends, other similar payments or distributions required or necessary under local law.
		

		
			
		

		
			

		 

		

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			SECTION 4.21. Intercompany Loans.  (i) Holdings shall cause Collateral Rig Operator and its other Subsidiaries to document all transfers of funds received from the Drilling Contract, or proceeds thereof, that are transferred between the Collateral Rig Operator and any of its Affiliates (other than payments on the Bareboat Charter and ordinary course intercompany billings) as intercompany loans.
		

		
			(ii)         Each Collateral Rig Owner shall document all transfers of funds received by it under a Bareboat Charter to any of its Affiliates (other than ordinary course intercompany billings and payments of amounts due to the Collateral Rig Operator under such Bareboat Charter and other than distributions to the Company permitted under Section 4.20(a)) as intercompany loans.
		

		
			(iii)       All intercompany loans owed to a Collateral Rig Owner in accordance with clause (b) above, shall (i) be documented in the form of intercompany loan agreements or intercompany notes and (ii) shall be pledged in favor of the Collateral Agent pursuant to an Account and Receivables Pledge Agreement in accordance with clause (8) of the definition of “Collateral and Guaranty Requirements”.  All intercompany loans entered into in accordance with clause (a) or (b) above shall be senior debt obligations of the obligors under such intercompany loans and rank equal with the other senior unsecured debt of such obligors.
		

		
			SECTION 4.22. Maintenance of Accounts.  (i) Holdings shall cause the Collateral Rig Operator to at all times maintain the Earnings Account, and the Earnings Account shall at all times be in the name of Collateral Rig Operator and be subject to a springing account control agreement in form and substance reasonably satisfactory to the Collateral Agent.
		

		
			(ii)         Each Collateral Rig Owner shall at all times maintain a Bareboat Account, and such Bareboat Account shall at all times be in the name of the applicable Collateral Rig Owner and be subject to a springing account control agreement in form and substance reasonably satisfactory to the Collateral Agent.
		

		
			SECTION 4.23. Performance under Contracts; Non-Interference.
		

		
			(i)          Holdings shall cause the Collateral Rig Operator to duly and punctually perform and observe in all material respects all obligations and conditions under the Bareboat Charters and the Drilling Contracts.
		

		
			(ii)         The Collateral Rig Owners shall duly and punctually perform and observe in all material respects all obligations and conditions under the Bareboat Charters.
		

		
			(iii)       Each of TINC, Holdings and each Subsidiary of Holdings, shall not (i) interfere with the Collateral Rig Operator’s performance under the Drilling Contracts and rights of the Collateral Rig Operator to receive the benefits thereunder, (ii) cause, directly or indirectly, the Collateral Rig Operator to breach its obligations under the Drilling Contracts, or (iii) otherwise interfere with the Drilling Contracts in any manner other than providing assistance to the Collateral Rig Operator to perform its obligations under the Drilling Contracts.
		

		
			SECTION 4.24. Taxes.  Holdings shall cause each of the Company, the Collateral Rig Owners and the Collateral Rig Operator to pay, prior to delinquency, all material taxes, assessments, and governmental levies except such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders.
		

		
			SECTION 4.25. Compliance with Laws; Policies and Procedures.
		

		
			
		

		
			

		 

		

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			(i)          Without limiting any of the other covenants in this Article 4, each of the Company, the Collateral Rig Owners and the Collateral Rig Operator shall (i) conduct its business, and otherwise be, in compliance with all applicable laws, regulations, ordinances and orders of any governmental or judicial authorities; provided,  however, that this Section 4.25 shall not require the Company, the Collateral Rig Owners or the Collateral Rig Operator to comply with any such law, regulation, ordinance or order if (x) it shall be contesting such law, regulation, ordinance or order in good faith by appropriate proceedings and reserves in conformity with GAAP have been provided therefor, or (y) the failure to comply therewith would not reasonably be expected to have a Material Adverse Effect, (ii) comply in all material respects with all obligations it might have under Anti-Corruption Laws, (iii) comply in all material respects with all applicable Sanctions, (iv) comply in all material respects with all laws and regulations applicable to the Collateral Rigs and the ownership, employment, operation, management and registration of the Collateral Rigs, including the applicable ISM Code, ISPS Code, Environmental Laws, and the laws of the applicable Flag Jurisdiction and (v) not employ the Collateral Rigs, nor allow its employment, operation or management, in any manner contrary in any material respect to any applicable law or regulation, including, but not limited to the applicable ISM Code, ISPS Code, Environmental Laws and Sanctions.
		

		
			(ii)         The Company and Holdings shall maintain in effect and enforce policies and procedures intended to ensure compliance by the Company and each other Note Party and their respective officers, directors, employees and agents with Anti-Corruption Laws and Sanctions.
		

		
			SECTION 4.26. Limitation on Modifications of Certain Documents.
		

		
			(i)          None of the Company nor the Collateral Rig Owners shall, and Holdings shall not permit the Collateral Rig Operator to, amend, modify or change its Organizational Documents other than in a transaction permitted by Sections 4.13 or 5.01 or any amendments, modifications or changes which are  materially adverse to the interests of the Holders; provided that, the Collateral Rig Operator shall be permitted to convert to a Delaware limited liability company;
		

		
			(ii)         The Collateral Rig Owners shall not, and Holdings shall not permit the Collateral Rig Operator, to terminate a Bareboat Charter (other than in connection with a Collateral Rig Substitution, the permitted transfer of a Collateral Rig pursuant to Section 4.29 or such Collateral Rig Owner becoming the Collateral Rig Operator) or amend or otherwise modify the terms of a Bareboat Charter in a manner that is materially adverse to the interests of the Holders, provided that amendments regarding the following shall be permitted:
		

		
			(1)         periodic adjustments to the amounts payable under a Bareboat Charter as negotiated between the Collateral Rig Operator and the applicable Collateral Rig Owner in accordance with applicable transfer pricing requirements, including the timing thereof;
		

		
			(2)         cash payments between the applicable Collateral Rig Owner and the Collateral Rig Operator required as a result of a settlement of a tax dispute with a taxing authority or as a result of a transfer pricing study in connection with the filing of a tax return; and
		

		
			(3)         changes allowing the applicable Collateral Rig Owner to make payments to the Collateral Rig Operator in any period in which it is reasonably anticipated that the Collateral Rig Operator would, in the absence of such payments, incur an operating loss with respect to the applicable Collateral Rig.
		

		
			(iii)       Holdings shall cause the Collateral Rig Operator not to amend or modify a Drilling Contract in any manner that, individually or taken as a whole with other amendments or modifications, would be materially adverse to the Holders; provided that any amendment or modification to a Drilling
		

		
			
		

		
			

		 

		

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			Contract that decreases the termination fees thereunder, shortens the tenor thereof or, when taken together with all facts and circumstances, materially diminishes the ability of the Company to timely pay principal and interest on the Notes shall be deemed to be materially adverse to the Holders.
		

		
			SECTION 4.27. Further Assurances.
		

		
			(i)          Each Collateral Grantor party hereto agrees that it will, and Holdings agrees to cause each other Collateral Grantor to, at any time and from time to time, at the expense of such Collateral Grantor, promptly execute and deliver all further instruments and documents, and take all further action that may be reasonably necessary, to ensure that the Collateral and Guaranty Requirements are satisfied with respect to the Collateral Rigs, including to perfect and protect any Lien granted or purported to be granted by the Security Documents, or to enable the Collateral Agent to exercise and enforce its rights and remedies under the Security Documents.  Without limiting the generality of the foregoing, the Collateral Rig Owners shall, and Holdings shall cause each Equity Pledgor and the Collateral Rig Operator to, pay any stamp duty or similar tax applicable to the execution of any Security Document and execute, if required, and file, or cause to be filed, such financing or continuation statements under the Uniform Commercial Code (or any non-U.S. equivalent thereto), or amendments thereto, such amendments or supplements to a Collateral Rig Mortgage (including any amendments required to maintain Liens granted by such Collateral Rig Mortgage), and such other instruments or notices, to protect and preserve the Liens granted or purported to be granted by the Security Documents.
		

		
			(ii)         Subject to Section 12.05, each Collateral Grantor party hereto hereby authorizes the Collateral Agent to file one or more financing or continuation statements under the Uniform Commercial Code (or any non-U.S. equivalent thereto), and amendments thereto, relative to all or any part of the Collateral without the signature of such Collateral Grantor, as applicable, where permitted by law.  The Collateral Agent will promptly send the Company a copy of any financing or continuation statements which it may file without the signature of the relevant Collateral Grantor and the filing or recordation information with respect thereto.
		

		
			(iii)       In the event that a Collateral Rig is transferred to a Subsidiary of Holdings in accordance with Sections 4.13 and 4.29, as applicable, Holdings will cause the Subsidiary to which such Collateral Rig is transferred and any Subsidiary of Holdings which directly owns the Equity Interests of such Subsidiary, to the extent not already an Equity Pledgor, to satisfy the Collateral and Guaranty Requirements with respect to such Collateral Rig (including the requirement for the applicable Collateral Rig Owner to execute a supplemental indenture substantially in the form of Appendix D hereto pursuant to which such Person will become a Guarantor) and the Equity Interests of such Collateral Rig Owner and take such other actions in connection therewith as would otherwise have been required to be taken pursuant to this Indenture had such Subsidiary(ies) been a Collateral Rig Owner or an Equity Pledgor, as applicable, on the Issue Date (including the delivery of relevant opinions, officer certificates, resolutions and organizational documents) and deliver to the Collateral Agent an Officer’s Certificate confirming that the Collateral and Guaranty Requirements are satisfied and the Opinions of Counsel required as part of such Collateral and Guaranty Requirements.
		

		
			(iv)        In the event that a Drilling Contract is transferred to a Subsidiary of Holdings in accordance with Sections 4.13 and 4.29, as applicable, Holdings will cause the Subsidiary to which such Drilling Contract is transferred and any Subsidiary of Holdings which directly owns the Equity Interests of such Subsidiary (other than any Equity Interests of the Collateral Rig Operator owned by a Qualified Local Partner, if applicable at such time), to the extent not already an Equity Pledgor, to satisfy the Collateral and Guaranty Requirements with respect to such Drilling Contract and such Equity Interests of the Collateral Rig Operator and take such other actions in connection therewith as would otherwise have been required to be taken pursuant to this Indenture had such Subsidiary been the Collateral Rig Operator or an Equity
		

		
			
		

		
			

		 

		

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			Pledgor, as applicable, on the Issue Date (including the delivery of relevant opinions, officer certificates, resolutions and organizational documents) and deliver to the Collateral Agent an Officer’s Certificate confirming that the Collateral and Guaranty Requirements are satisfied and the Opinions of Counsel required as part of such Collateral and Guaranty Requirements.
		

		
			(v)         Notwithstanding any provision contained herein or in any other Note Document, Collateral Rig Substitutions will be permitted so long as Holdings causes the applicable Collateral Rig Owner to satisfy the Collateral and Guaranty Requirements with respect to the applicable Collateral Rig contemporaneously with the consummation of such Collateral Rig Substitution and take such other actions in connection therewith as would otherwise have been required to be taken pursuant to this Indenture had the substituted Acceptable Rig been a Collateral Rig on the Issue Date (including the delivery of relevant opinions, officer certificates, resolutions and organizational documents).
		

		
			(vi)        Notwithstanding any provision contained herein or in any other Note Document, Drilling Contract Substitutions will be permitted so long as Holdings causes the Collateral Rig Operator to satisfy the Collateral and Guaranty Requirements with respect to the applicable Drilling Contract contemporaneously with the consummation of such Drilling Contract Substitution and take such other actions in connection therewith as would otherwise have been required to be taken pursuant to this Indenture had the substituted Acceptable Drilling Contract been a Drilling Contract on the Issue Date (including the delivery of relevant opinions, officer certificates, resolutions and organizational documents).
		

		
			SECTION 4.28. Master Services Agreement.  Holdings shall cause the Collateral Rig Operator to continue to be a party to the Master Services Agreement and to have access to the Services (as defined therein) and personnel provided thereunder in order to comply with the performance standards under each Drilling Contract until the stated expiration date of such Drilling Contract regardless of whether the applicable Collateral Rig Owner or the Collateral Rig Operator remains an Affiliate of Holdings.
		

		
			SECTION 4.29. Transfer of Collateral Rig; Transfer of Drilling Contract.  Each Collateral Rig Owner shall not transfer its Collateral Rig or its rights under the applicable Bareboat Charter to any other Person and Holdings shall not permit the Collateral Rig Operator to transfer its rights under a Drilling Contract to any other Person, in each case, other than (i) to a Subsidiary of Holdings and (ii) subject to the satisfaction of the following conditions:
		

		
			(i)          such Subsidiary of Holdings has no Liens other than those permitted under the Indenture to be incurred by a Collateral Rig Owner or the Collateral Rig Operator, as applicable;
		

		
			(ii)         such Subsidiary of Holdings has no material contingent liabilities outside the ordinary course of business that would be reasonably likely to have a Material Adverse Effect on it or that would adversely affect the enforceability of any Lien for the benefit of the Holders or on any Securities Guarantee;
		

		
			(iii)       such Subsidiary of Holdings shall have provided to the Collateral Agent all relevant board resolutions and shareholder resolutions (if necessary) authorizing the consummation of the transactions contemplated by the Note Documents to which it will become a party and copies of its Organizational Documents;
		

		
			(iv)        such Subsidiary of Holdings shall have provided to the Trustee all necessary and customary “know your customer” information and documentation;
		

		
			
		

		
			

		 

		

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			(v)         such Subsidiary of Holdings shall have no litigation by any entity (private or governmental) pending or threatened with respect to the Securities or any Note Document, or which has had or would reasonably be expected to have, a Material Adverse Effect;
		

		
			(vi)        such Subsidiary of Holdings shall have provided a solvency certificate to the Collateral Agent from the President of TINC setting forth the conclusion that such Subsidiary, on an individual basis, is not insolvent;
		

		
			(vii)       such Subsidiary of Holdings shall have provided to the Collateral Agent all relevant legal opinions from counsel in relevant jurisdictions;
		

		
			(viii)     such Subsidiary of Holdings shall have executed and delivered to the Collateral Agent all Security Documents necessary to satisfy the Collateral and Guaranty Requirements, and the Collateral Agent shall have a first-priority perfected security interest in the Collateral purported to be covered by such agreements, subject to Permitted Collateral Liens, in each case, as certified by such Subsidiary in an Officer’s Certificate;
		

		
			(ix)        such Subsidiary of Holdings shall provide insurance materials that satisfy the Collateral and Guaranty Requirements and the requirements set forth in Section 4.08;
		

		
			(x)         such Subsidiary of Holdings shall certify that the representations and warranties set forth on Annex I hereto applicable to it as a Collateral Rig Owner or Collateral Rig Operator, as applicable, are true and correct in all material respects; and
		

		
			(xi)        the Company shall deliver an Officers’ Certificate to the Trustee and the Collateral Agent certifying that all of the requirements of the immediately preceding clauses (a) through (j) (other than clause (d)) are satisfied and the Collateral Agent is authorized to enter into the applicable Security Documents in connection therewith.
		

		
			SECTION 4.30. Post-Bankruptcy Restrictions.  Holdings shall, and Holdings shall cause its Subsidiaries to, not take or support any of the following actions after the occurrence of an Event of Default under Section 6.01(f) or (g): (a) reject a Drilling Contract or a Bareboat Charter; or (b) challenge any transfer made in connection with the Note Documents as a preference or fraudulent conveyance.
		

		
			SECTION 4.31. Waiver of Certain Covenants.  Holdings may and may cause any Subsidiary of Holdings to omit in any particular instance to comply with any term, provision or condition set forth in the Indenture or any applicable Note Document (other than any term, provision or condition the amendment or waiver of which would require the consent of each Holder of an Outstanding Security affected thereby, pursuant to Section 10.02), if before the time for such compliance the Holders of at least a majority in principal amount of the Outstanding Securities shall either waive such compliance in such instance or generally waive compliance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of Holdings and the Subsidiaries of Holdings and the duties of the Trustee in respect of any such term, provision or condition shall remain in full force and effect.
		

		
			The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to waive compliance with any covenant or condition hereunder.  If a record date is fixed, the Holders of such record date, or their duly appointed agents, and only such Persons shall be entitled to waive any such compliance, whether or not such Holders remain Holders after such record date, provided that unless the Holders of at least a majority in aggregate principal amount of the Outstanding Securities shall have waived such compliance prior to the date which is 90 days after such record date, any such waiver
		

		
			
		

		
			

		 

		

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			previously given shall automatically and without further action by any Holder be cancelled and of no further effect.
		

		
			Article 5
		

		
			Successor Company
		

		
			SECTION 5.01. Consolidation, Merger and Sale of Assets.  The Company will not, in any transaction or series of transactions, consolidate with or merge into or engage in a scheme of arrangement qualifying as an amalgamation with any Person, or sell, lease, convey, transfer or otherwise dispose of all or substantially all of its assets to any Person, unless:
		

		
			(1)         either (a) the Company shall be the continuing Person or (b) the Person (if other than the Company) formed by such consolidation or into which the Company is merged or amalgamated, or to which such sale, lease, conveyance, transfer or other disposition is made (the “Successor”) expressly assumes by supplemental indenture the due and punctual payment of the principal of, premium (if any) and interest on and any Additional Amounts with respect to all the Securities and the performance of the Company’s covenants and obligations under this Indenture and the Securities;
		

		
			(2)         immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom; and
		

		
			(3)         the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that the transaction and such supplemental indenture (if any) comply with this Indenture.
		

		
			For the avoidance of doubt, (x) the term “merger” includes an amalgamation under Cayman Islands law, and the term “all or substantially all of its assets”, with respect to the Company, shall be computed on a consolidated basis”, (y) entry into a drilling contract or bareboat charter shall not constitute a sale, lease, conveyance, transfer or other disposition subject to this Article 5 and (z) a reference to “series of transactions” in this Article 5 shall mean a series of related transactions.
		

		
			SECTION 5.02. Successor Company Substituted.  Upon any consolidation or merger of the Company, in which the Company is not the continuing entity, or any sale, lease, conveyance, transfer or other disposition of all or substantially all of the assets of the Company in accordance with Section 5.01, the Successor formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance, transfer or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of the Company under this Indenture and the Securities with the same effect as if such Successor had been named as the Company herein and the predecessor Company, in the case of a sale, conveyance, transfer or other disposition, shall be released from all obligations under this Indenture and the Securities, provided, that in the case of a lease of all or substantially all its assets, the predecessor Company will not be released from its obligations under this Indenture or the Securities.
		

		
			Article 6
		

		
			Defaults and Remedies
		

		
			SECTION 6.01. Events of Default.  Each of the following is an “Event of Default” with respect to the Securities:
		

		
			(i)          failure to pay interest on any Security when such interest becomes due and payable and such default is continued for 30 days;
		

		
			
		

		
			

		 

		

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			(ii)         failure to pay principal of (or premium including the Make-Whole Premium, if any, on) any Security when it becomes due and payable;
		

		
			(iii)       failure by the Company to make an offer in connection with a Change of Control Repurchase Event in accordance with the provisions described under Section 4.02 of this Indenture;
		

		
			(iv)        failure to comply with any covenant or agreement in this Indenture in respect of the Securities, and such default or breach is continued for 90 days (or 150 days with respect to Section 4.09 of this Indenture; provided,  however, that beginning on the 91st day the Note Parties are not in compliance with Section 4.09, additional interest at a rate of 0.25% per annum shall become due and payable (in the same manner and at the same time as regular interest payments) on the Securities until such covenant is complied with) after there has been given to the Company a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal of Outstanding Securities affected thereby (other than a default in performance, or breach, of a covenant or agreement specifically dealt with in clauses (a), (b) or (c) above);
		

		
			(v)         any Securities Guarantee ceases to be in full force and effect (other than in accordance with the terms of such Securities Guarantee or pursuant to the terms of this Indenture or other applicable Note Document) or any Guarantor denies or disaffirms its obligations under its Securities Guarantee;
		

		
			(vi)        the Company or any other Note Party pursuant to or within the meaning of any Bankruptcy Law:
		

		
			(1)         commences a voluntary case,
		

		
			(2)         consents to the entry of an order for relief against it in an involuntary case,
		

		
			(3)         consents to the appointment of a Bankruptcy Custodian of it or for all or substantially all of its property, or
		

		
			(4)         makes a general assignment for the benefit of its creditors;
		

		
			(vii)       a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that remains unstayed and in effect for 90 days and that:
		

		
			(1)         is for relief against the Company or any other Note Party as debtor in an involuntary case,
		

		
			(2)         appoints a Bankruptcy Custodian of the Company or any other Note Party or a Bankruptcy Custodian for all or substantially all of the property of the Company, or any other Note Party or
		

		
			(3)         orders the liquidation of the Company or any other Note Party;
		

		
			(viii)     except as permitted by the Note Documents, the Security Documents shall for any reason cease to create a valid and perfected first-priority Lien (subject to Permitted Collateral Liens) on any portion of the Collateral having a fair market value in excess of $25,000,000 (in each case, other than in accordance with the terms of this Indenture or the terms of the Security Documents); provided  that if such failure is susceptible to cure, no Event of Default shall arise with respect thereto until 45 days after any
		

		
			
		

		
			

		 

		

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			Officer of any Collateral Grantor becomes aware of such failure, which failure has not been cured during such time period, or (ii) any Collateral Grantor asserts in writing that any Lien created under the Security Documents is invalid or unenforceable; or
		

		
			(ix)        if the counterparty under a Drilling Contract is more than 120 days late with respect to the making of any payment due under such Drilling Contract, the failure by the Collateral Rig Operator to actively pursue remedies under such Drilling Contract with respect to such nonpayment.
		

		
			Upon the occurrence of an Event of Default pursuant to this Section 6.01 with respect to Securities all or part of which is represented by a Global Security, a record date shall automatically and without any other action taken by any Person be set for the purpose of determining the Holders of Outstanding Securities entitled to join in any Notice of Default, which record date shall be the close of business on the day the Trustee shall have received such Notice of Default.  The Holders of Outstanding Securities on such record date (or their duly appointed agents), and only such Persons, shall be entitled to join in such Notice of Default, whether or not such Holders remain Holders after such record date; provided that, unless such Notice of Default shall have become effective by virtue of Holders of the requisite principal amount of Outstanding Securities on such record date (or their duly appointed agents) having joined in such Notice of Default prior to the day which is 90 days after such record date, such Notice of Default shall automatically and without any action by any Person be cancelled and of no further effect.  Nothing in this paragraph shall prevent a Holder (or duly appointed agent thereof) from giving, before or after expiration of such 90-day period, a Notice of Default contrary to or different from a Notice of Default previously given by a Holder, or from giving, after the expiration of such period, a Notice of Default identical to a Notice of Default that has been cancelled pursuant to the proviso to the preceding sentence, in any of which events a record date in respect thereof shall be set pursuant to the provisions of this Section 6.01.
		

		
			SECTION 6.02. Acceleration of Maturity; Rescission and Annulment.  If an Event of Default described in Section 6.01 (other than Event of Default specified in Section 6.01(f) or (g)) with respect to Securities at the time Outstanding occurs and is continuing, then in every such case the Trustee or the Holders of not less than 25% in aggregate principal amount, if any, of the Outstanding Securities, declare the principal amount of all of the Securities and all interest thereon to be due and payable immediately, together with the Make-Whole Premium, if any, by a notice in writing to the Company (and to the Trustee if given by the Holders) and upon any such declaration such amounts shall become immediately due and payable.  Upon the occurrence of an Event of Default specified in Section 6.01(f) or (g), the principal amount of all of the Securities, all interest thereon, and the Make-Whole Premium, if any, shall automatically and immediately become due and payable.
		

		
			For the avoidance of doubt, if the principal amount of the Securities is paid on or prior to July 15, 2021, the Make-Whole Premium provided under Section 3.08 hereof shall be paid, even if such payment is made following acceleration pursuant to this Section 6.02. The Company will pay the Make-Whole Premium, as compensation to the Holders for the loss of their investment opportunity and not as a penalty, whether or not an Event of Default specified in Section 6.01(f) or (g) has occurred and (if an Event of Default specified in Section 6.01(f) or (g) has occurred) without regard to whether the event causing such Event of Default is voluntary or involuntary, or whether payment occurs pursuant to a motion, plan of reorganization, or otherwise, and without regard to whether the Securities and other Notes Obligations are satisfied or released by foreclosure (whether or not by power of judicial proceeding), deed in lieu of foreclosure or by any other means.  Any premium payable pursuant to this Section 6.02 shall be presumed to be the liquidated damages sustained by each Holder as a result of the early repayment of the Securities and the Note Parties agree that it is reasonable under the circumstances currently existing.  EACH NOTE PARTY EXPRESSLY WAIVES (TO THE FULLEST EXTENT IT MAY LAWFULLY DO SO) THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE OR LAW THAT PROHIBITS OR MAY PROHIBIT THE COLLECTION OF THE MAKE-WHOLE PREMIUM IN CONNECTION WITH ANY
		

		
			
		

		
			

		 

		

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			SUCH ACCELERATION. The Company expressly agrees (to the fullest extent it may lawfully do so) that: (A) the Make-Whole Premium is reasonable and the product of an arm’s length transaction between sophisticated business people, ably represented by counsel; (B) the Make-Whole Premium shall be payable notwithstanding the then prevailing market rates at the time payment is made; (C) there has been a course of conduct between Holders and the Company giving specific consideration in this transaction for such agreement to pay the Make-Whole Premium; and (D) the Company shall be estopped hereafter from claiming differently than as agreed to in this paragraph. The Company expressly acknowledges that its agreement to pay the Make-Whole Premium to the Trustee for the ratable benefit of the Holders as herein described is a material inducement to Holders to purchase the Securities.
		

		
			At any time after such a declaration of acceleration with respect to Securities has been made, but before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter provided in this Article, the Holders of a majority in aggregate principal amount of the Outstanding Securities, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if:
		

		
			(1)         the Company has paid or deposited with the Trustee a sum sufficient to pay in U.S. dollars,
		

		
			(A)        all overdue interest, if any, on all Outstanding Securities,
		

		
			(B)        all unpaid principal of (and premium including the Make-Whole Premium, if any, on) any Outstanding Securities which has become due otherwise than by such declaration of acceleration, and interest, if any, on such unpaid principal (and premium including the Make-Whole Premium, if any) at the rate or rates prescribed therefor in such Securities,
		

		
			(C)        to the extent that payment of such interest is lawful, interest on overdue interest, if any, at the rate or rates prescribed therefor in such Securities, and
		

		
			(D)        all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; and
		

		
			(2)         all Events of Default with respect to Securities other than the non-payment of amounts of principal of (or premium including the Make-Whole Premium, if any, on) or interest on Securities which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.13.
		

		
			No such rescission shall affect any subsequent default or impair any right consequent thereon.
		

		
			Upon the Trustee providing any declaration of acceleration, or rescission and annulment thereof pursuant to this Section 6.02 with respect to Securities all or part of which is represented by a Global Security, a record date shall automatically and without any other action by any Person be set for the purpose of determining the Holders of Outstanding Securities entitled to join such declaration of acceleration, or rescission and annulment, as the case may be, which record date shall be the close of business on the date the Trustee shall have provided such declaration of acceleration, or rescission and annulment, as the case may be.  The Holders of Outstanding Securities on such record date (or their duly appointed agents), and only such Persons, shall be entitled to join in such declaration of acceleration, or rescission and annulment, as the case may be, whether or not such Holders remain Holders after such record date; provided that, unless such declaration of acceleration, or rescission and annulment, as the case may be, shall have become
		

		
			
		

		
			

		 

		

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			effective by virtue of the requisite percentage having been obtained prior to the day which is 90 days after such record date (or their duly appointed agents), such declaration of acceleration, or rescission and annulment, as the case may by, shall automatically and without any action by any Person be cancelled and of no further effect.  Nothing in this paragraph shall prevent a Holder (or duly appointed agent thereof) from giving, before or after the expiration of such 90-day period, a declaration of acceleration, or a rescission and annulment of any such declaration, contrary to or different from a declaration previously given by a Holder, or from giving, after the expiration of such period, a declaration identical to a declaration of acceleration, or rescission and annulment thereof, as the case may be, that has been cancelled pursuant to the proviso to the preceding sentence, in any of which events a new record date shall be established pursuant to the provisions of this Section 6.02.
		

		
			SECTION 6.03. Collection of Indebtedness and Suits for Enforcement by Trustee.  The Company covenants that if:
		

		
			(1)         default is made in the payment of any installment of interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or
		

		
			(2)         default is made in the payment of the principal of (or premium including the Make-Whole Premium, if any, on) any Security at the Maturity thereof and on any date required under Section 3.09, the Company shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal (and premium including the Make-Whole Premium, if any) and interest, if any, and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal (and premium including the Make-Whole Premium, if any) and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
		

		
			If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name, as Trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.
		

		
			If an Event of Default with respect to Securities occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.
		

		
			SECTION 6.04. Trustee May File Proofs of Claim.  In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal, premium including the Make-Whole Premium, if any, or interest, if any) shall be entitled and empowered, by intervention in such proceeding or otherwise,
		

		
			
		

		
			

		 

		

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			(1)         to file and prove a claim for the whole amount of principal (and premium including the Make-Whole Premium, if any) and interest, if any, owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and
		

		
			(2)         to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payment to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.06.
		

		
			Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
		

		
			SECTION 6.05. Trustee May Enforce Claims Without Possession of Securities.  All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.
		

		
			SECTION 6.06. Application of Money Collected.  Any money collected by the Trustee or the Collateral Agent pursuant to this Article (including upon any realization of any Lien upon Collateral) shall, subject to the terms of the Security Documents, be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal (or premium including the Make-Whole Premium, if any) or interest, if any, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:
		

		
			FIRST: To the payment of all amounts due the Trustee or the Collateral Agent under Section 7.06;
		

		
			SECOND: To the payment of the amounts then due and unpaid for principal of (and premium including the Make-Whole Premium, if any) and interest, if any, on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal (and premium including the Make-Whole Premium, if any) and interest, if any, respectively; and
		

		
			THIRD: The balance, to the Person or Persons entitled thereto.
		

		
			SECTION 6.07. Limitation on Suits.  No Holder of any Security shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, the Securities, or the other Note Documents, or for the appointment of a receiver or trustee, or for any other remedy hereunder or thereunder, unless:
		

		
			
		

		
			

		 

		

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			(1)         such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities;
		

		
			(2)         the Holders of not less than 25% in aggregate principal amount of the Outstanding Securities shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;
		

		
			(3)         such Holder or Holders have offered to the Trustee indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request;
		

		
			(4)         the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and
		

		
			(5)         no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in aggregate principal amount of the Outstanding Securities;
		

		
			it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing themselves of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all of such Holders (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not any such use by a Holder affects, disturbs or prejudices the rights of other Holders or obtains or seeks to obtain priority or preference over such other Holders or enforces any right under this Indenture).
		

		
			SECTION 6.08. Unconditional Contractual Right of Holders to Receive Principal, Premium and Interest.  Subject to the following sentence, notwithstanding any other provision in this Indenture, the Holder of any Security shall have the contractual right, which is absolute and unconditional, to receive payment, as provided herein (including, if applicable, Article 8) and in such Security of the principal of (and premium including the Make-Whole Premium, if any) and interest, if any, on such Security on the Stated Maturity or any Maturities (or, in the case of redemption, on the redemption date) and to institute suit for the enforcement of any such payment, and such contractual rights shall not be impaired without the consent of such Holder.  Notwithstanding the foregoing, no amendment to, or deletion or waiver of any of the covenants described in Article 4 of this Indenture (other than Section 4.01) or in any other Note Document or any action taken by the Company or Guarantors not prohibited hereunder (other than with respect to actions set forth in the first paragraph of Section 10.02) shall be deemed to impair or affect any rights of any Holder to receive payment of principal of, and premium, interest and Additional Amounts, if any, on, the Notes.
		

		
			SECTION 6.09. Restoration of Rights and Remedies.  If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.
		

		
			SECTION 6.10. Rights and Remedies Cumulative.  Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 2.07, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is
		

		
			
		

		
			

		 

		

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			intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
		

		
			SECTION 6.11. Delay or Omission Not Waiver.  No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
		

		
			SECTION 6.12. Control by Holders.  The Holders of not less than a majority in aggregate principal amount of the Outstanding Securities in respect of which an Event of Default has occurred shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Outstanding Securities, provided that in each case (1) such direction shall not be in conflict with any rule of law or with this Indenture, and (2) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.
		

		
			Upon receipt by the Trustee of any such direction with respect to Securities all or part of which is represented by a Global Security, a record date shall automatically and without any further action by any Person be set for the purpose of determining the Holders of Outstanding Securities entitled to join in such direction, which record date shall be the close of business on the day the Trustee shall have received such direction.  The Holders of Outstanding Securities on such record date (or their duly appointed agents), and only such Persons, shall be entitled to join in such direction, whether or not such Holders remain Holders after such record date; provided that, unless such direction shall have become effective by virtue of Holders of the requisite principal amount of Outstanding Securities on such record date (or their duly appointed agents) having joined therein on or prior to the 90th day after such record date, such direction shall automatically and without any action by any Person be cancelled and of no further effect.  Nothing in this paragraph shall prevent a Holder (or a duly appointed agent of a Holder) from giving, before or after the expiration of such 90-day period, a direction contrary to or different from a direction previously given by a Holder, or from giving, after the expiration of such period, a direction identical to a direction that has been cancelled pursuant to the proviso to the preceding sentence, in any of which events a new record date in respect thereof shall be set pursuant to the provisions of this Section 6.12.
		

		
			SECTION 6.13. Waiver of Past Defaults.  Subject to Section 6.02, the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities may on behalf of the Holders of all the Outstanding Securities waive any past Default or Event of Default hereunder, except a default
		

		
			(1)         in the payment of the principal of (or premium including the Make-Whole Premium, if any) or interest on any Security or the payment of Additional Amounts, if any, or
		

		
			(2)         in respect of a covenant or provision hereof which under Article 10 cannot be modified or amended without the consent of the Holder of each Outstanding Security affected.
		

		
			The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to waive any past Default or Event of Default hereunder.  If a record date is fixed, the Holders on such record date (or their duly designated agents), and only such Persons, shall be entitled to waive any such default hereunder, whether or not such Holders remain Holders after such record date;
		

		
			
		

		
			

		 

		

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			provided, that unless such majority in principal amount shall have been obtained prior to the date which is 90 days after such record date, any such waiver previously given shall automatically and without further action by any Holder be cancelled and of no further effect.
		

		
			Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture and the other Note Documents; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
		

		
			SECTION 6.14. Undertaking for Costs.  All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder or group of Holders holding in the aggregate more than 25% in aggregate principal amount of the Outstanding Securities, or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium including the Make-Whole Premium, if any) or interest on any Security on or after the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on or after the redemption date).
		

		
			SECTION 6.15. Waiver of Stay or Extension Laws.  The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted; provided that this Section shall not prohibit the Company from exercising any rights it may have under this Indenture to contest any actions taken by the Trustee pursuant to this Section.
		

		
			Article 7
		

		
			Trustee
		

		
			SECTION 7.01. Duties of Trustee.  (i) If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs.
		

		
			(ii)         Except during the continuance of an Event of Default:
		

		
			(1)         the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
		

		
			(2)         in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates or opinions which by any provision hereof are specifically
		

		
			
		

		
			

		 

		

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			required to be furnished to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
		

		
			(iii)       The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
		

		
			(1)         this paragraph does not limit the effect of paragraph (b) of this Section;
		

		
			(2)         the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
		

		
			(3)         the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.12.
		

		
			(iv)        Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
		

		
			(v)         The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.
		

		
			(vi)        Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
		

		
			(vii)       No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
		

		
			(viii)     Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section.
		

		
			SECTION 7.02. Rights of Trustee.  Subject to Section 7.01:
		

		
			(i)          The Trustee may rely on any document believed by it to be genuine and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or matter stated in the document.
		

		
			(ii)         Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Officer’s Certificate or Opinion of Counsel.
		

		
			(iii)       The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
		

		
			(iv)        The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture.
		

		
			(v)         The Trustee may consult with counsel, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization
		

		
			
		

		
			

		 

		

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			and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
		

		
			(vi)        Unless otherwise specified in this Indenture, any demand, request or notice from the Company will be sufficient if signed by an Officer of the Company.
		

		
			(vii)       The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.
		

		
			(viii)     The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.
		

		
			(ix)        In no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
		

		
			(x)         The Trustee shall not be deemed to have notice of any Default or Event of Default unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture.
		

		
			(xi)        The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, the Collateral Agent and each agent, custodian and other Person employed to act hereunder.
		

		
			(xii)       In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
		

		
			(xiii)     The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
		

		
			(xiv)      The Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.
		

		
			
		

		
			

		 

		

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			(xv)       No provision of this Indenture shall be deemed to impose any duty or obligation on the Trustee to take or omit to take any action, in the performance of its duties or obligations under this Indenture, or to exercise any right or power thereunder, to the extent that taking or omitting to take such action would violate applicable law binding upon it.
		

		
			SECTION 7.03. Individual Rights of Trustee.  The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.  Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights.  However, the Trustee must comply with Section 7.09.
		

		
			SECTION 7.04. Trustee’s Disclaimer.  The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture (or any supplement thereto), the Securities or any of the Note Documents, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement of the Company in this Indenture, any Note Document or in any document issued in connection with the sale of the Securities or in the Securities other than the Trustee’s certificate of authentication.
		

		
			SECTION 7.05. Notice of Defaults.  If a Default occurs with respect to the Securities and is continuing and written notice of such Default has been received by the Trustee as specified in Section 7.02(j), the Trustee shall send to each Holder a notice of the Default within 30 days after  such written notice of it is received by a Trust Officer of the Trustee.  Except in the case of a Default in the payment of principal of, premium (if any) or interest on any Security, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Holders.
		

		
			SECTION 7.06. Compensation and Indemnity.  The Company and the Guarantors, jointly and severally, agree to: (i) pay to the Trustee from time to time reasonable compensation for its services as has been agreed to by the Company and the Trustee, which compensation shall not be limited by any law on compensation of a trustee of an express trust; (ii) reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services (such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s agents, counsel, advisors, accountants and experts); and (iii) indemnify, defend, protect and hold harmless the Trustee (in its individual capacity and Trustee capacities) and its directors, officers and agents against any and all loss, damage, claims, liability, cost or expense (including reasonable attorneys’ fees and expenses and court costs) incurred by it in connection with the acceptance or administration of this Indenture and the trusts thereunder and the performance of its duties hereunder or any of the Note Documents (including the costs and expenses of enforcing this Indenture against the Company or any of the Guarantors (including this Section 7.06) or defending itself against any claim whether asserted by any Holder, the Company, any Priority Unsecured Notes Subsidiary Guarantor, or any Collateral Grantor, or liability in connection with the acceptance, exercise or performance of any of its powers or duties hereunder.  The Trustee shall notify the Company promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder or any of the Note Documents.  The Company shall defend the claim and the Trustee may have separate counsel and the Company shall pay the fees and expenses of such counsel.  The Company need not reimburse any expense or indemnify against any loss, liability or expense found by a court of competent jurisdiction in a final, non-appealable judgment to have been incurred by the Trustee through the Trustee’s own willful misconduct or gross negligence.
		

		
			
		

		
			

		 

		

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			To secure the Company’s and the Guarantors’ payment obligations in this Section 7.06, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee other than money or property held in trust to pay principal of and interest on particular Securities.
		

		
			The Company’s and the Guarantors’ payment obligations pursuant to this Section shall survive the satisfaction and discharge of this Indenture and the resignation or removal of the Trustee.  When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.01(f) or (g) with respect to the Company, the expenses are intended to constitute expenses of administration under any Bankruptcy Law or any similar federal, provincial, territorial or state law for the relief of debtors.
		

		
			SECTION 7.07. Replacement of Trustee.  The Trustee may resign at any time by so notifying the Company.  The Holders of a majority in principal amount of the Securities may remove the Trustee with respect to the Securities by so notifying with 31 days prior notice to the Trustee and may appoint a successor Trustee.  The Company shall remove the Trustee if:
		

		
			(1)         the Trustee fails to comply with Section 7.09;
		

		
			(2)         the Trustee is adjudged bankrupt or insolvent;
		

		
			(3)         a receiver or other public officer takes charge of the Trustee or its property; or
		

		
			(4)         the Trustee otherwise becomes incapable of acting.
		

		
			If the Trustee resigns or is removed by the Company, or is removed by the Holders of a majority in principal amount of the Securities and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee.
		

		
			A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of its succession to Holders of the Securities.  The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.06.
		

		
			If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee (at the Company’s expense) or the Holders of 10% in principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee.
		

		
			If the Trustee fails to comply with Section 7.09, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
		

		
			Notwithstanding the replacement of the Trustee pursuant to this Section, the Company’s obligations under Section 7.06 shall continue for the benefit of the retiring Trustee.
		

		
			SECTION 7.08. Successor Trustee by Merger.  If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.
		

		
			
		

		
			

		 

		

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			In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture any of the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Securities or in this Indenture provided that the certificate of the Trustee shall have.
		

		
			SECTION 7.09. Corporate Trustee Required; Eligibility.  (i) There shall at all times be a Trustee hereunder which shall be:
		

		
			(1)         a corporation organized and doing business under the laws of the United States, or of any state or territory thereof, or of the District of Columbia, authorized under such laws to exercise corporate trust powers, and subject to supervision or examination by federal or state authority, or
		

		
			(2)         a corporation or other person organized and doing business under the laws of a foreign government permitted to act as a Trustee pursuant to a rule, regulation or other order of the Commission, authorized under such laws to exercise corporate trust powers, and subject to supervision or examination by authority of such foreign government or a political subdivision thereof substantially equivalent to supervision or examination applicable to United States institutional trustees.
		

		
			(ii)         The Trustee shall have at all times a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.
		

		
			SECTION 7.10. Debt Service Reserve Account.
		

		
			(i)          The Trustee agrees to open and maintain (other than with respect to funding) the Debt Service Reserve Account at all times. All amounts contained in the Debt Service Reserve Account are to be held in trust by the Trustee.
		

		
			(ii)         At any time that the amount on deposit in the Debt Service Reserve Account exceeds the Debt Service Reserve, the Company may withdraw the amount of such excess by executing and delivering a DSRA Withdrawal Certificate the form of which is attached hereto as Appendix L; provided that, the Company shall not make more than two such withdrawals in any calendar year.
		

		
			(iii)       Concurrently with the execution of this Indenture, the Company shall deliver to the Trustee Appendix N, which contains the authorized signer designations in Part A thereof.
		

		
			(iv)        The Trustee shall confirm each funds transfer instruction received in the name of the Company by means of the security procedure selected by the Company and communicated to the Trustee through a signed certificate in the form of Appendix N attached hereto, which upon receipt by the Trustee shall become a part of this Indenture. Once delivered to the Trustee, Appendix N may be received or rescinded only by a writing signed by an authorized representative of the Company. Such revisions or rescissions shall be effective only after actual receipt and following such period of time as may be necessary to afford the Trustee a reasonable opportunity to act on it. If a revised Appendix N or a rescissions of an existing Appendix N is delivered to the Trustee by an entity that is a successor-in-interest to the Company, such document shall be accompanied by additional documentation satisfactory to the Trustee showing that such entity has succeeded to the rights and responsibilities of the Company under this Indenture.
		

		
			
		

		
			

		 

		

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			(v)         The Company understands the Trustee’s inability to receive or confirm funds transfer instructions pursuant to the security procedures selected by the Company may result in a delay in accomplishing such funds transfer, and agree that the Trustee shall not be liable for any loss caused by any such delay.
		

		
			Article 8
		

		
			Defeasance and Covenant Defeasance
		

		
			SECTION 8.01. Option to Effect Defeasance or Covenant Defeasance.  The Company may, at its option and at any time, elect to have either Section 8.02 or Section 8.03 applied to all Outstanding Securities and Securities Guarantees upon compliance with the conditions set forth below in this Article 8.
		

		
			SECTION 8.02. Defeasance.  Upon the Company’s exercise of the above option applicable to this Section, the Company (and each other Note Party) shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities (including the Securities Guarantees) on the date the conditions set forth below are satisfied (hereinafter, “defeasance”).  For this purpose, such defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the Outstanding Securities (including the Securities Guarantees) which shall thereafter be deemed to be “Outstanding” only for the purposes of Section 8.05 and the other Sections of this Indenture referred to in (A) and (B) below and to have satisfied all its other obligations under such Securities, the Securities Guarantees and this Indenture insofar as such Securities are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (A) the rights of Holders of Outstanding Securities to receive solely from the trust fund described in Section 8.04 and as more fully set forth in such Section, payments in respect of the principal of and interest, if any, on such Securities when such payments are due, (B) the Company’s obligations with respect to such Securities under Sections 2.06, 2.07 and 2.09, and with respect to the payment of Additional Amounts, if any, on such Securities as contemplated by Section 13.01, (C) the rights, powers, trusts, duties, and immunities of the Trustee hereunder and (D) this Article 8.  Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03.
		

		
			SECTION 8.03. Covenant Defeasance.  Upon the Company’s exercise of the above option applicable to this Section, and unless and until the Company has exercised its option applicable to Section 8.02, the Company (and each other applicable Note Party) shall be released from its obligations under Article 4 (other than Sections 4.01, 4.03 and 4.09(b)) with respect to the Outstanding Securities (including the Securities Guarantees), any covenant added to this Indenture subsequent to the Issue Date and the covenants contained in the other Note Documents on and after the date the conditions set forth below are satisfied (hereinafter, “covenant defeasance”, and such Securities shall thereafter be deemed not to be “Outstanding” for the purposes of any direction, waiver, consent or declaration (and the consequences thereof) in connection with such covenants, but shall continue to be deemed “Outstanding” for all other purposes hereunder).  For this purpose, such covenant defeasance means that with respect to such Outstanding Securities the Company (and any applicable Note Party) may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any covenants set out in Article 4 (other than Sections 4.01, 4.03 and 4.09(b)), any covenant added to this Indenture subsequent to the Issue Date and the covenants contained in the other Note Documents, whether directly or indirectly by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document, but the remainder of this Indenture and the Securities shall be unaffected thereby.  In addition, upon the Company’s exercise of such covenant defeasance, subject to the conditions set forth in Section 8.04 below, Clauses (c), (d) and (f) of Section 6.01 hereof shall not constitute “Events of Default”.
		

		
			
		

		
			

		 

		

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			SECTION 8.04. Conditions to Defeasance or Covenant Defeasance.  The following shall be the conditions to application of either Section 8.02 or Section 8.03 to the Outstanding Securities and Securities Guarantees:
		

		
			(1)         the Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee satisfying the requirements of Section 7.09 who shall agree to comply with the provisions of this Article 8 applicable to it) as trust funds in trust for the purpose of making the following payments;
		

		
			(2)         pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities, (A) money in an amount, or (B) U.S. Government Obligations applicable to such Securities (determined on the basis of the Currency in which such Securities are then specified as payable at Stated Maturity) which through the scheduled payment of principal and interest, if any, in respect thereof in accordance with their terms shall provide, not later than one day before the due date of any payment of principal of and premium including the Make-Whole Premium, if any, and interest, if any, under such Securities, money in an amount, or (C) a combination thereof, sufficient in the case of (A), (B) or (C), in each case after deducting therefrom the amount contained in the Debt Service Reserve Account as of such date, in the opinion of a nationally recognized firm of financial advisors or independent chartered professional accountants (expressed in a written certification thereof delivered to the Company, as evidenced by an Officer’s Certificate delivered to the Trustee), without consideration of any reinvestment of interest, to pay and discharge, and which shall be applied by the Trustee (or other qualifying Trustee) to pay and discharge, the principal of (and premium including the Make-Whole Premium, if any) and interest, if any, on the Outstanding Securities on the Stated Maturity (or redemption date, if applicable) of such principal or interest, if any.  For this purpose, “U.S. Government Obligations” means securities that are (x) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (y) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian with respect to any such U.S. Government Obligation or a specific payment of principal of or interest on any such U.S. Government Obligation held by such custodian or the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or a specific payment of principal of or interest on any such U.S. Government Obligation held by such custodian for the account of the holder of such depository receipt;
		

		
			(3)         no Event of Default or event which with notice or lapse of time or both would become an Event of Default with respect to the Securities shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit and the granting of Liens to secure such borrowings);
		

		
			(4)         such defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default under, any agreement or instrument to which the Company or any Guarantor is a party or by which it is bound (other than this Indenture or any other Note Document and the agreements governing any other Indebtedness being defeased, discharged or replaced);
		

		
			(5)         in the case of an election under Section 8.02, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States stating that (x) the Company has received
		

		
			
		

		
			

		 

		

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			from, or there has been published by, the U.S. Internal Revenue Service a ruling, or (y) since the date of this Indenture there has been a change in the applicable U.S. Federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Securities shall not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such defeasance and shall be subject to U.S. Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had not occurred;
		

		
			(6)         in the case of an election under Section 8.03, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States to the effect that the Holders of the Outstanding Securities shall not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such covenant defeasance and shall be subject to U.S. Federal income tax on the same amount, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred; and
		

		
			(7)         the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the defeasance under Section 8.02 or the covenant defeasance under Section 8.03 (as the case may be) have been complied with.
		

		
			The Collateral will be released from the Liens securing the Note Obligations, as provided in Section 12.02 upon defeasance or covenant defeasance in accordance with the provisions of this Section 8.04.
		

		
			SECTION 8.05. Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions.  All money and U.S. Government Obligations (including the proceeds thereof) deposited with the Trustee pursuant to Section 8.04 in respect of the Outstanding Securities (including the Securities Guarantees) shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any paying agent (including the Company acting as its own paying agent) as the Trustee may determine, to the Holders of such Securities, of all sums due and to become due thereon in respect of principal and interest, if any, but such money need not be segregated from other funds except to the extent required by law.
		

		
			The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Obligations deposited pursuant to Section 8.04 or the principal (and premium including the Make-Whole Premium, if any) and interest, if any received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the Outstanding Securities.
		

		
			Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon a company request any money or U.S. Government Obligations held by it as provided in Section 8.04 which, in the opinion of a nationally recognized firm of financial advisors or independent public accountants (expressed in a written certification thereof delivered to the Company, together with an Officer’s Certificate delivered to the Trustee), are, including in the calculation thereof the amount contained in the Debt Service Reserve Account as of such date, in excess of the amount thereof which would then be required to be deposited to effect an equivalent defeasance or covenant defeasance.
		

		
			SECTION 8.06. Reinstatement.  If the Trustee or any paying agent is unable to apply any money in accordance with Section 8.05 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture, the Note Documents and such Securities shall be revived and reinstated as though no
		

		
			
		

		
			

		 

		

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			deposit had occurred pursuant to Section 8.02 or 8.03, as the case may be, until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.05; provided,  however, that if the Company makes any payment of principal of (or premium including the Make-Whole Premium, if any) or interest, if any, on any such Security following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money held by the Trustee or paying agent.
		

		
			Article 9
		

		
			Satisfaction and Discharge
		

		
			SECTION 9.01. Satisfaction and Discharge of Indenture.  (i)  This Indenture and the other Note Documents shall cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities expressly provided for herein or pursuant hereto and any right to receive Additional Amounts as contemplated by Article 13), and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture and the other Note Documents, when:
		

		
			(1)         either:
		

		
			(A)        all Outstanding Securities that have been authenticated, except lost, stolen or destroyed Securities that have been replaced or paid and Securities for which payment money has been deposited in trust and thereafter repaid to the Company, have been delivered to the Trustee for cancellation, or
		

		
			(B)        all Outstanding Securities and not theretofore delivered to the Trustee for cancellation:
		

		
			(i)          have become due and payable by reason of the delivery of a notice of redemption or otherwise, or
		

		
			(ii)         shall become due and payable at their Stated Maturity within one year, or
		

		
			(iii)       are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (i), (ii) or (iii) above, has deposited or caused to be irrevocably deposited with the Trustee as trust funds in trust for the purpose an amount in cash in the currency in which the Securities of such Securities are payable, sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal (and premium including the Make-Whole Premium, if any) and interest, if any, to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or redemption date, as the case may be, in each case after deducting therefrom the amount contained in the Debt Service Reserve Account as of such date; or
		

		
			
		

		
			

		 

		

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			(2)         the Company or any Guarantor has paid or caused to be paid all other sums payable hereunder by the Company with respect to the Outstanding Securities (other than contingent obligations or liabilities for which no claim or demand for payment has been made); and
		

		
			(3)         the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.
		

		
			(ii)         After the conditions to discharge contained in this Article 9 have been satisfied, and the Company or any Guarantor has paid or caused to be paid all other sums payable hereunder, and delivered to the Trustee an Officer’s Certificate and Opinion of Counsel, each stating that all conditions precedent to satisfaction and discharge have been satisfied, the Trustee upon written request shall acknowledge in writing the discharge of the obligations of the Company and the other Note Parties under this Indenture and the other Note Documents.
		

		
			Article 10
		

		
			Amendment, Supplement and Waiver
		

		
			SECTION 10.01. Without Consent of Holders.  The Company, the other Note Parties, the Trustee, and the Collateral Agent (if applicable) at any time and from time to time, may amend or supplement this Indenture and other Note Documents without notice to or consent of any Holder to:
		

		
			(i)          cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture or other Note Documents, provided such action shall not adversely affect the interests of the Holders of Securities in any material respect;
		

		
			(ii)         provide for the assumption of the Company’s, a Collateral Grantor’s or a Guarantor’s obligations in the case of a merger, amalgamation or consolidation or sale, lease, conveyance, transfer or other disposition of all or substantially all of the Company’s, such Collateral Grantor’s or such Guarantor’s assets in accordance with Sections 4.13 or 5.01, as applicable;
		

		
			(iii)       provide for uncertificated Securities in addition to or in place of certificated Securities;
		

		
			(iv)        to allow any Guarantor to execute a supplemental indenture with respect to the Securities and to add any additional Guarantor;
		

		
			(v)         add to the covenants of the Company or any other Note Party for the benefit of the Holders of the Securities or to surrender any right or power herein or in the other Note Documents conferred upon the Company or any other Note Party;
		

		
			(vi)        [intentionally omitted];
		

		
			(vii)       to enter into additional or supplemental Security Documents and to add additional assets as Collateral to secure the Securities and the Securities Guarantees;
		

		
			(viii)     to release, terminate or discharge, or to confirm and evidence the release, termination or discharge of, any Collateral or any Securities Guarantee when permitted or required by this Indenture or the Security Documents or to amend or supplement any Security Document in accordance with this Indenture or the Security Documents, including, without limitation, upon the replacement of a
		

		
			
		

		
			

		 

		

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			Collateral Rig Owner in connection with a transfer of a Collateral Rig or the replacement of a Collateral Rig Operator in connection with a transfer of a Drilling Contract, in each case, in accordance with Section 4.29;
		

		
			(ix)        to enter into any and all Security Documents and the transactions contemplated thereby respecting the registration and mortgaging of a Collateral Rig and to perfect the security interests and Liens granted therein;
		

		
			(x)         to accept and consent to, and to take, any and all steps to perfect a security interest in a Collateral Rig and other Collateral granted pursuant to the Security Documents;
		

		
			(xi)        evidence and provide for the acceptance of appointment hereunder by a successor Trustee or a successor Collateral Agent and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee;
		

		
			(xii)       supplement any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the defeasance and discharge of Securities pursuant to Sections 8.01, 8.02, 8.03 and 9.01; provided that any such action shall not adversely affect the interests of the Holders of Securities or any other series of Securities in any material respect; or
		

		
			(xiii)     comply with Article 5 or Section 4.13.
		

		
			After an amendment under this Section 10.01 becomes effective, the Company shall mail to Holders a notice briefly describing such amendment.  The failure to give such notice to all Holders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 10.01.
		

		
			SECTION 10.02. With Consent of Holders.  Except as provided above in Section 10.01 and below in this Section 10.02, the Company, the other Note Parties, the Trustee and the Collateral Agent (if applicable) may amend this Indenture and the other Note Documents with the consent of the Holders of at least a majority in principal amount of the Outstanding Securities affected (including consents obtained in connection with a tender offer or exchange for the Securities) and any past default or compliance with any provisions may also be waived with the consent of the Holders of at least a majority in principal amount of the Outstanding Securities affected.  However, without the consent of each Holder of an Outstanding Security affected thereby, an amendment or waiver may not:
		

		
			(i)          change the Stated Maturity of the principal of or any installment of interest on any Security, or change the due date of the Make-Whole Premium or any other premium;
		

		
			(ii)         reduce the principal amount thereof (or premium including the Make-Whole Premium, if any) or the rate of interest, if any, on any Security;
		

		
			(iii)       change any obligation of the Company to pay Additional Amounts contemplated by Section 13.01;
		

		
			(iv)        reduce the amount of the principal of or premium on any Security that would be due and payable upon a declaration of acceleration of the maturity thereof pursuant to Section 6.02 or the amount thereof provable in bankruptcy pursuant to Section 6.04, or adversely affect any right of repayment at the option of any Holder (other than Section 4.02);
		

		
			
		

		
			

		 

		

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			(v)         change the currency of payment of principal on (or premium including the Make-Whole Premium, if any) or interest, if any on any Security;
		

		
			(vi)        reduce the percentage in aggregate principal amount of the Outstanding Securities required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture or certain defaults and their consequences provided for in this Indenture;
		

		
			(vii)       change any provision of the Note Documents providing for payments or redemptions (other than provisions relating to the covenant described in Section 4.02 hereof and provisions relating to the number of days’ notice to be given in the case of redemption);
		

		
			(viii)     make any change in, or release other than in accordance with this Indenture, any Securities Guarantee that would adversely affect the Holders of any such Securities; or
		

		
			(ix)        release the Liens for the benefit of the Holders on all or substantially all of the Collateral other than in accordance with this Indenture and the Security Documents;
		

		
			(x)         release any Note Party from its obligations under this Indenture or any other Note Document, other than in accordance with this Indenture and the other Note Documents; or
		

		
			(xi)        modify any of the provisions of this Section, Section 6.13 or Section 4.31 except to increase any percentage or to provide that certain provisions of this Indenture cannot be waived without the consent of the Holder of each Outstanding Security.
		

		
			The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any indenture supplemental hereto.  If a record date is fixed, the Holders on such record date or their duly designated agents, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; provided that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 90 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect.
		

		
			It shall not be necessary to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if the substance thereof shall be approved.
		

		
			SECTION 10.03. Execution of Supplemental Indentures.  The Trustee and the Collateral Agent (if applicable) shall sign any amendment or supplemental indenture authorized pursuant to this Article 10 if such amendment or supplemental indenture does not adversely affect the rights, duties or immunities of the Trustee or Collateral Agent, as applicable.  In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee and Collateral Agent (if applicable) shall be entitled to receive, and (subject to Section 7.01) shall be fully protected in relying upon, an Officer’s Certificate and Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and that such supplemental indenture is the legal, valid and binding obligation of Company and any Guarantors party thereto, enforceable against them in accordance with its terms, subject to customary exceptions.  The Trustee and the Collateral Agent (if applicable) may, but shall not be obligated to, enter into any such amendment or supplemental indenture which affects the Trustee’s or Collateral Agent’s, as applicable, own rights, duties or immunities under this Indenture or otherwise.
		

		
			
		

		
			

		 

		

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			SECTION 10.04. Effect of Supplemental Indentures.  Upon the execution of any supplemental indenture under this Article, this Indenture or the applicable Note Document shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture or the applicable Note Document for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.
		

		
			SECTION 10.05. Reference in Securities to Supplemental Indentures.  Securities authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may bear a notation as to any matter provided for in such supplemental indenture.  If the Company shall so determine, new Securities so modified as to conform, in the opinion of the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities.
		

		
			SECTION 10.06. Notice of Supplemental Indentures.  Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of Section 10.03, the Company shall give notice thereof to the Holders of each Outstanding Security affected, in the manner set forth in Section 14.01, setting forth in general terms the substance of such supplemental indenture.
		

		
			Article 11
		

		
			Guarantees
		

		
			SECTION 11.01. Guarantees.  Each Guarantor of Securities hereby unconditionally and irrevocably guarantees, jointly and severally, on a senior basis to each Holder and to the Trustee and its successors and assigns (a) the full and punctual payment of principal of and interest on the Securities when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company under this Indenture with respect to the Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under this Indenture with respect to the Securities (all the foregoing, being hereinafter collectively called the “Guaranteed Obligations”).  Each Guarantor of Securities further agrees that the Guaranteed Obligations may be extended or renewed, in whole or in part, without notice or further assent from such Guarantor and that such Guarantor will remain bound under this Article 11 notwithstanding any extension or renewal of any obligation.
		

		
			Each Guarantor of Securities waives presentation to, demand of, payment from and protest to the Company of any of the Guaranteed Obligations and also waives notice of protest for nonpayment.  Each Guarantor of Securities waives notice of any default under the Securities or the Guaranteed Obligations.  The obligations of each Guarantor hereunder of Securities shall not be affected by (1) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person (including any Guarantor) under this Indenture with respect to the Securities or any other agreement or otherwise; (2) any extension or renewal of any thereof; (3) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture with respect to the Securities or any other agreement; (4) the release of any security held by any Holder or the Trustee for the Guaranteed Obligations or any of them; (5) the failure of any Holder or the Trustee to exercise any right or remedy against any other guarantor of the Guaranteed Obligations; or (6) except as set forth in Section 11.06, any change in the ownership of such Guarantor.
		

		
			Each Guarantor of Securities further agrees that its Securities Guarantee herein constitutes a guarantee of payment, performance and compliance when due (and not a guarantee of collection) and waives any right to require that any resort be had by any Holder or the Trustee to any Security held for payment of the Guaranteed Obligations.
		

		
			
		

		
			

		 

		

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			Except as expressly set forth in Sections 9.01, 11.02 and 11.06, the obligations of each Guarantor of Securities hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or otherwise.  Without limiting the generality of the foregoing, the obligations of each Guarantor of Securities herein shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture with respect to the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of such Guarantor or would otherwise operate as a discharge of such Guarantor as a matter of law or equity.
		

		
			Each Guarantor of Securities further agrees that its Securities Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of or interest on any obligation is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
		

		
			In furtherance of the foregoing and not in limitation of any other right which any Holder of Securities or the Trustee has at law or in equity against any Guarantor by virtue hereof, upon the failure of the Company to pay the principal of or interest on any Guaranteed Obligation when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other Guaranteed Obligation, each Guarantor hereby promises to and shall, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (A) the unpaid amount of such Guaranteed Obligations, (B) accrued and unpaid interest on such Guaranteed Obligations (but only to the extent not prohibited by law) and (C) all other monetary Guaranteed Obligations of the Company to the Holders and the Trustee.
		

		
			Each Guarantor of Securities agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (i) the maturity of the Guaranteed Obligations hereby may be accelerated as provided in Article 6 for the purposes of such Guarantor’s Securities Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed Obligations guaranteed hereby, and (ii) in the event of any declaration of acceleration of such Guaranteed Obligations as provided in Article 6, such Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by such Guarantor for the purposes of this Section 11.01.
		

		
			Each Guarantor of Securities also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees) incurred by the Trustee or any Holder in enforcing any rights under this Section 11.01.
		

		
			SECTION 11.02. Limitation on Liability.  Any term or provision of this Indenture to the contrary notwithstanding, the maximum aggregate amount of the Guaranteed Obligations guaranteed hereunder by any Guarantor of Securities shall not exceed the maximum amount that can be hereby guaranteed without rendering this Indenture, as it relates to such Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.
		

		
			SECTION 11.03. Successors and Assigns.  This Article 11 shall be binding upon each Guarantor and its successors and assigns and shall enure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in this Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this Indenture.
		

		
			
		

		
			

		 

		

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			SECTION 11.04. No Waiver.  Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 11 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 11 at law, in equity, by statute or otherwise.
		

		
			SECTION 11.05. Modification.  No modification, amendment or waiver of any provision of this Article 11, nor the consent to any departure by any Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on any Guarantor in any case shall entitle such Guarantor to any other or further notice or demand in the same, similar or other circumstances.
		

		
			SECTION 11.06. Release of Certain Guarantors.  (i) A Guarantor will be automatically released from its obligations under this Article 11:
		

		
			(1)         As provided for in Section 4.13(f);
		

		
			(2)         upon defeasance or covenant defeasance of the Securities pursuant to Article 8 or if the Company’s obligations under this Indenture are satisfied and discharged pursuant to Article 9; or
		

		
			(3)         in the case of a Collateral Rig Owner, upon the replacement of such Collateral Rig Owner in connection with a transfer of the applicable Collateral Rig in accordance with Section 4.29 pursuant to which another wholly-owned Subsidiary of Holdings shall become a Collateral Rig Owner and a Guarantor hereunder.
		

		
			(ii)         At the request of the Company and upon delivery of an Officer’s Certificate and Opinion of Counsel, if required, the Trustee shall execute and deliver an appropriate instrument evidencing the release of a Guarantor pursuant to this Section 11.06.
		

		
			SECTION 11.07. Execution and Delivery.  (i) To evidence its Securities Guarantee set forth in Section 11.01, each Guarantor hereby agrees that this Indenture shall be executed on behalf of such Guarantor by an officer, director, general manager or person holding an equivalent title.
		

		
			(ii)         Each Guarantor hereby agrees that its Securities Guarantee set forth in Section 11.01 shall remain in full force and effect notwithstanding the absence of the endorsement of any notation of such Securities Guarantee on the Securities.
		

		
			(iii)       If the person whose signature is on this Indenture no longer holds that office at the time the Trustee authenticates any Security, the Securities Guarantees shall be valid nevertheless.
		

		
			(iv)        The delivery of any Security by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Securities Guarantee set forth in this Indenture on behalf of the Guarantors.
		

		
			Article 12
		

		
			Security
		

		
			SECTION 12.01. Security Documents; Additional Collateral.
		

		
			
		

		
			

		 

		

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			(i)          In order to secure the due and punctual payment of the Notes Obligations, (i) on the Issue Date, simultaneously with the execution and delivery of this Indenture, the Collateral Grantors have executed Security Documents granting to the Collateral Agent for the benefit (or, where applicable, as direct representative) of the Secured Creditors a first-priority perfected Lien in the Collateral, and (ii) after the Issue Date, each Subsidiary of Holdings that is required to become a Collateral Grantor pursuant to Section 4.27 shall execute and deliver the necessary Security Documents in order to grant to the Collateral Agent a first-priority perfected Lien in all assets of such Subsidiary which are required to, but do not already, constitute Collateral.
		

		
			(ii)         Holdings shall cause every Collateral Grantor to from time to time take the actions required by Section 4.27.
		

		
			SECTION 12.02. Releases of Collateral.  The Notes Obligations will no longer be required to be secured by Liens on Collateral and the Liens securing the Notes Obligations will be released:
		

		
			(i)          in whole, upon the payment in full of all Notes Obligations (other than contingent obligations or liabilities for which no claim or demand for payment has been made);
		

		
			(ii)         upon defeasance or covenant defeasance of the Securities pursuant to Article 8 or if the Company’s obligations under this Indenture are satisfied and discharged pursuant to Article 9;
		

		
			(iii)       in part, as provided for in Section 4.13(f);
		

		
			(iv)        in part, upon the transfer of a Collateral Rig, the transfer of a Drilling Contract, a Flag Jurisdiction Transfer, a Collateral Rig Substitution or a Drilling Contract Substitution, in each case, in accordance with Section 4.27 and 4.29, if applicable;
		

		
			(v)         in part, upon the transfer of any Equity Interests of the Collateral Rig Operator to a Qualified Local Partner, to the extent necessary under local law for the operation of a Collateral Rig in an applicable jurisdiction, and in relation only to such transferred Equity Interests; and
		

		
			(vi)        in whole or in part, with the consent of the requisite Holders as provided in Section 10.02.
		

		
			SECTION 12.03. Release Documentation.  Upon compliance with the conditions to release of all or any portion of the Collateral set forth in Section 12.02, the Collateral Agent and the Trustee shall forthwith take all necessary action (at the request of and the expense of the Company, accompanied by an Officers’ Certificate and Opinion of Counsel that the conditions precedent to such release have been satisfied) to release and re-convey to the applicable Collateral Grantor the applicable portion of the Collateral that is authorized to be released pursuant to Section 12.02, and shall deliver such Collateral  in its possession to the applicable Collateral Grantor, including, without limitation, executing and delivering releases and satisfactions wherever required.
		

		
			SECTION 12.04. Possession and Use of Collateral; No Impairment of the Security Interests.
		

		
			(i)          So long as no Event of Default has occurred and is continuing, and subject to the terms of this Indenture and the Security Documents, each Collateral Grantor will be entitled to freely operate the property and assets constituting the Collateral pledged by it and to receive, invest and dispose of all cash dividends, principal, interest and other payments made upon or with respect to the Collateral pledged by it and to exercise any voting and other consensual rights pertaining to the Collateral pledged by it.
		

		
			
		

		
			

		 

		

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			(ii)         No Collateral Grantor shall take any action, or knowingly omit to take any action, which action or omission would have the result of materially impairing the validity, perfection or priority of the security interests in the Collateral created by the Security Documents, (except as expressly set forth in this Indenture or the Security Documents, including any action that would result in a Permitted Collateral Lien).
		

		
			(iii)       No Collateral Grantor shall take any action or otherwise attempt to enforce any claim or maritime lien held by it against a Collateral Rig that has priority over any claim or Lien of the Collateral Agent in respect of such Collateral Rig, including any claims or Liens arising under the applicable Collateral Rig Mortgage.
		

		
			(iv)        The Collateral Agent will distribute all funds received by it in accordance with the provisions of the Security Documents, and the Trustee will distribute all funds received by it from the Collateral Agent for the benefit of the Trustee and the Holders in accordance with the provisions of this Indenture.
		

		
			SECTION 12.05. Collateral Agent.  The Trustee and each of the Holders by acceptance of the Securities hereby authorize the appointment of the Collateral Agent as the Trustee’s and the Holders’ Collateral Agent under the Security Documents and in its capacity as mortgagee and security trustee pursuant to the Collateral Rig Mortgages, and the Trustee and each of the Holders by acceptance of the Securities hereby irrevocably authorize the Collateral Agent to enter into the Security Documents and to take such action on their behalf under the provisions of the Security Documents and to exercise such powers and perform such duties as are expressly delegated to the Collateral Agent by the terms of this Indenture and the Security Documents, together with such powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary contained elsewhere in this Indenture and the Security Documents, the duties of the Collateral Agent shall be ministerial and administrative in nature, and the Collateral Agent shall not have any duties or responsibilities, except those expressly set forth herein and in the Security Documents to which the Collateral Agent is a party, nor shall the Collateral Agent have or be deemed to have any trust or fiduciary relationship with the Trustee, any Holder, the Company, any Collateral Grantor or any Guarantor, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Indenture and the Security Documents or otherwise exist against the Collateral Agent.  Without limiting the generality of the foregoing sentence, the use of the term “agent” in this Indenture with reference to the Collateral Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law.  Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.
		

		
			The Trustee is authorized and directed by the Holders and the Holders by acquiring the Securities are deemed to have authorized the Trustee, as applicable, to cause the Collateral Agent to enter into and perform its obligations under the Security Documents.  The Collateral Agent is authorized and directed by the Trustee and the Holders and the Holders by acquiring the Securities are deemed to have authorized the Collateral Agent, to (i) enter into the Security Documents to which it is a party, (ii) bind the Trustee and the Holders on the terms as set forth in such Security Documents and (iii) perform and observe its obligations and exercise its rights and powers under such Security Documents, including entering into amendments, supplements and other modifications permitted by the terms of this Indenture or the Security Documents.  Each Holder, by its acceptance of a Security, is deemed to have consented and agreed to the terms of each Security Document, as originally in effect and as amended, restated, replaced, supplemented or modified from time to time in accordance with its terms or the terms of this Indenture.  Each of the Holders by acquiring the Securities is hereby deemed to have directed the Trustee to appoint the Collateral Agent as its mortgagee and security trustee to receive, hold, administer and enforce the Collateral Rig Mortgages covering the Collateral Rigs, as contemplated under this Indenture.
		

		
			
		

		
			

		 

		

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			The Collateral Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, unless the Collateral Agent shall have received written notice from the Trustee or unless a written notice of any event which is in fact such a Default is received by the Collateral Agent at the address specified in Section 14.01, and such notice references the Securities and this Indenture.  The Collateral Agent shall take such action with respect to such Default or Event of Default as may be requested by the Trustee in accordance with Article 6 or the Holders of a majority in aggregate principal amount of the Securities (subject to this Section 12.05).
		

		
			The Collateral Agent shall have no obligation and makes no representation whatsoever to the Trustee or any of the Holders as to the existence, genuineness, value or protection of the Collateral or the sufficiency of any Security Documents, or that the Collateral is owned by any of the Collateral Grantors or is cared for, protected or insured or has been encumbered, or that the Collateral Agent’s Liens have been properly or sufficiently or lawfully created, perfected, protected, maintained or enforced or are entitled to any particular priority, or to determine whether all of the Collateral Grantor’s property constituting Collateral intended to be subject to the Lien and security interest of the Security Documents has been properly and completely listed or delivered, as the case may be, or the genuineness, validity, marketability or sufficiency thereof or title thereto, or to exercise at all or in any particular manner or under any duty of care, disclosure or fidelity, or to continue exercising, any of the rights, authorities, and powers granted or available to the Collateral Agent pursuant to this Indenture or any other Security Documents, it being understood and agreed that in respect of the Collateral, or any act, omission, or event related thereto, the Collateral Agent shall have no other duty or liability whatsoever to the Trustee or any Holder as to any of the foregoing.  The grant of permissive rights or powers to the Collateral Agent shall not be construed to impose duties to act.  For the avoidance of doubt, nothing herein shall require the Collateral Agent to file financing statements or continuation statements, to record any documents or instruments in any public office at any time or be responsible for perfection or maintaining the perfection of the security interests purported to be created by the Security Documents and such responsibility shall be solely that of the Company.
		

		
			Each of the Collateral Agent and the Trustee, each in its capacity as such, shall not be liable or responsible for the failure of the Company or any Collateral Grantor to maintain insurance on the Collateral, nor shall it be responsible for any loss due to the insufficiency of such insurance or by reason of the failure of any insurer to pay the full amount of any loss against which it may have insured to the Company or any Collateral Grantor, the Trustee, the Collateral Agent or any other Person.  The provisions of Article 7, mutatis mutandis, shall apply to the Collateral Agent.
		

		
			SECTION 12.06. Replacement of Collateral Agent.  The Collateral Agent may resign at any time by so notifying the Company.  The Holders of a majority in principal amount of the Securities may remove Collateral Agent with respect to the Securities by so notifying with 31 days prior notice to the Collateral Agent and may appoint a successor Collateral Agent.  The Company shall remove Collateral Agent if:
		

		
			(1)         the Collateral Agent is adjudged bankrupt or insolvent;
		

		
			(2)         a receiver or other public officer takes charge of the Collateral Agent or its property; or
		

		
			(3)         the Collateral Agent otherwise becomes incapable of acting.
		

		
			If the Collateral Agent resigns or is removed by the Company, or is removed by the Holders of a majority in principal amount of the Securities and such Holders do not reasonably promptly appoint a successor Collateral Agent, or if a vacancy exists in the office of Collateral Agent for any reason (the Collateral Agent in such event being referred to herein as the retiring Collateral Agent), the Company shall promptly appoint a successor Collateral Agent.
		

		
			
		

		
			

		 

		

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			A successor Collateral Agent shall deliver a written acceptance of its appointment to the retiring Collateral Agent and to the Company.  Thereupon the resignation or removal of the retiring Collateral Agent shall become effective, and the successor Collateral Agent shall have all the rights, powers and duties of the Collateral Agent under this Indenture.  The successor Collateral Agent shall mail a notice of its succession to Holders of the Securities.  The retiring Collateral Agent shall promptly transfer all property held by it as Collateral Agent to the successor Collateral Agent.
		

		
			If a successor Collateral Agent does not take office within 30 days after the retiring Collateral Agent resigns or is removed, the retiring Collateral Agent or the Holders of 10% in principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Collateral Agent.
		

		
			SECTION 12.07. Purchaser Protected.  No purchaser or grantee of any property or rights purporting to be released from the Liens in favor of the Collateral Agent shall be bound to ascertain the authority of the Collateral Agent or Trustee to execute the release or to inquire as to the existence of any conditions herein prescribed for the exercise of such authority so long as the conditions set forth in Section 12.02 have been satisfied.
		

		
			SECTION 12.08. Authorization of Receipt of Funds by the Trustee Under the Security Documents.  The Trustee is authorized to receive any funds for the benefit of Holders distributed under the Security Documents and to apply such funds as provided in Section 6.06.
		

		
			SECTION 12.09. Powers Exercisable by Receiver or Trustee.  In case the Collateral shall be in the possession of a receiver or trustee, lawfully appointed, the powers conferred in this Article 12 upon any Collateral Grantor, as applicable, with respect to the release, sale or other disposition of such property may be exercised by such receiver or trustee, and an instrument signed by such receiver or trustee shall be deemed the equivalent of any similar instrument of any Collateral Grantor, as applicable, or of any officer or officers thereof required by the provisions of this Article 12.
		

		
			SECTION 12.10. Compensation and Indemnification.  The Collateral Agent shall be entitled to the compensation and indemnification set forth in Section 7.06 (with the references to the Trustee therein being deemed to refer to and include the Collateral Agent).
		

		
			SECTION 12.11. Form of Security Documents and Opinions.  To the extent that any provision of this Indenture or any Security Document requires the execution or delivery by the Trustee or the Collateral Agent after the Issue Date of any Security Documents, agreements, certificates, opinions or other documents (including, without limitation, any such opinions or documents described in the definition of “Collateral and Guaranty Requirements”), in each case, in form and substance reasonably satisfactory to the Trustee or the Collateral Agent, or other similar discretionary approval, or in substantially in the same form as such Security Documents, agreements, certificates, opinions or other documents were delivered on the Issue Date or as attached hereto, the Holders, by acquiring the Securities, are deemed to have approved the form and substance of any such Security Documents, agreements, certificates, opinions or other documents in substantially the same form as those executed and delivered on the Issue Date, in each case, with such changes as may be appropriate to reflect the entity subject to or the subject of or the governing law of such Security Documents, agreements, certificates, opinions or other documents and the jurisdiction of organization of such entity and hereby authorize the Trustee and the Collateral Agent, as applicable, to execute such documents and accept such documents and opinions.  For the avoidance of doubt, this Section 12.11 shall not supersede any requirement contained herein regarding the delivery of an Officer’s Certificate or an Opinion of Counsel.
		

		
			
		

		
			

		 

		

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			Article 13
		

		
			Additional Amounts
		

		
			SECTION 13.01. Payment of Additional Amounts.
		

		
			(i)          The Company shall pay any amounts due with respect to the Securities and the Guarantors will pay any amounts due with respect to the Securities Guarantees without deduction or withholding for any and all present and future withholding taxes, levies, imposts and charges (a “withholding tax”) imposed by or for the account of the Cayman Islands, Switzerland or any other jurisdiction in which either the Company or a Guarantor is a resident for tax purposes or any political subdivision or taxing authority of such jurisdiction (the “Taxing Jurisdiction”), unless such withholding or deduction is required by law.  If such deduction or withholding is at any time required, the Company or such Guarantor, as applicable, will, to the fullest extent allowed by law (subject to compliance by the holder of a Security with any relevant administrative requirements), pay additional amounts (the “Additional Amounts”) in respect of principal amount, redemption price and interest (if any), in accordance with the terms of the Securities and this Indenture, as may be necessary so that the net amounts paid to the holder or the Trustee after such deduction or withholding will equal the principal amount, redemption price and interest (if any), on the Securities.  However, neither the Company nor any Guarantor will pay any Additional Amounts in the following instances:
		

		
			(1)         if any withholding would not be payable or due but for the fact that (i) the holder of a Security (or a fiduciary, settlor, beneficiary of, member or shareholder of, the holder, if the holder is an estate, trust, partnership or corporation), is a domiciliary, national or resident of, or engaging in business or maintaining a permanent establishment or being physically present in, the Taxing Jurisdiction or otherwise having some present or former connection with the Taxing Jurisdiction other than the holding or ownership of the Security or the collection of principal amount, redemption price, repurchase price and interest (if any), in accordance with the terms of the Securities and this Indenture, or the enforcement of the Security or (ii) where presentation is required, the Security was presented more than 30 days after the date such payment became due or was provided for, whichever is later;
		

		
			(2)         if any withholding tax is attributable to any estate, inheritance, gift, sales, transfer, excise, personal property or similar tax, levy, impost or charge;
		

		
			(3)         if any withholding tax is attributable to any tax, levy, impost or charge which is payable otherwise than by withholding from payment of principal amount, redemption price, repurchase price and interest (if any);
		

		
			(4)         if any withholding tax would not have been imposed but for the failure to comply with certification, information, documentation or other reporting requirements concerning the nationality, residence, identity or connections with the relevant tax authority of the holder or beneficial owner of the Security, if this compliance is required by statute or by regulation as a precondition to relief or exemption from such withholding tax;
		

		
			(5)         to the extent a holder of a Security is entitled to a refund or credit in such Taxing Jurisdiction of amounts required to be withheld by such Taxing Jurisdiction;
		

		
			(6)         if any withholding is required to be made pursuant to laws enacted by Switzerland providing for the taxation of payments according to principles similar to those laid down in the draft legislation of the Swiss Federal Council of December 17, 2014, or otherwise changing the Swiss federal withholding tax system from an issuer-based system to a paying‐agent‐based system
		

		
			
		

		
			

		 

		

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			pursuant to which a person other than the issuer is required to withhold tax on any interest payments;
		

		
			(7)         if any withholding tax or deduction is required to be made in respect of any tax, duty, assessment or other governmental charge imposed or withheld pursuant to Sections 1471 through 1474 of the Code, as of the date hereof (or any amended or successor version), current or future U.S. Treasury Regulations issued thereunder or any official interpretation thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code; or
		

		
			(8)         any combination of the instances described in the preceding clauses.
		

		
			(ii)         With respect to clause (a)(5) above, in the absence of evidence satisfactory to the Company or the applicable Guarantor, it may conclusively presume that a holder of a Security is entitled to a refund or credit of all amounts required to be withheld.  The Company or the applicable Guarantor also will not pay any Additional Amounts to any holder who is a fiduciary or partnership or other than the sole beneficial owner of the Security to the extent that a beneficiary or settlor with respect to such fiduciary, or a member of such partnership or a beneficial owner thereof, would not have been entitled to the payment of such Additional Amounts had such beneficiary, settlor, member or beneficial owner been the holder of the Security.
		

		
			SECTION 13.02. Swiss Minimum Interest.
		

		
			(i)          When entering into this Indenture, the parties have assumed that the payments under the Indenture and the other Note Documents are not and will not become subject to any tax deduction on account of Swiss Withholding Tax.
		

		
			(ii)         Notwithstanding the paragraph above if a tax deduction on account of Swiss Withholding Tax should, at any time, be or become required by law in respect of any payment under the Indenture or any other Note Document and should it be unlawful for a Guarantor incorporated in Switzerland (each, a “Swiss Guarantor”) to comply with Section 13.01 for any reason (where this would otherwise be required by the terms of Section 13.01) then:
		

		
			(1)         the applicable interest rate in relation to that payment shall be the interest rate which would have applied to that payment, as provided for in the applicable Security, divided by 1 minus the rate at which the relevant tax deduction is required to be made under Swiss domestic tax law and/or applicable double taxation treaties (where the rate at which the relevant tax deduction is required to be made is for this purpose expressed as a fraction of 1); and
		

		
			(2)         such Swiss Guarantor shall:
		

		
			(A)        pay the relevant interest at the adjusted rate in accordance with paragraph (1) above;
		

		
			(B)        make a tax deduction on the interest so recalculated; and
		

		
			(C)        all references to a rate of interest under the Note Documents shall be construed accordingly.
		

		
			
		

		
			

		 

		

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			Article 14
		

		
			Miscellaneous
		

		
			SECTION 14.01. Notices.  Any notice or communication shall be in writing and delivered in person or mailed by first-class mail addressed as follows:
		

		
			if to the Company or any other Note Party, to such Note Party:
		

		
			c/o Transocean Inc.
		

		
			70 Harbour Drive
		

		
			P.O. Box 10342
		

		
			Cayman Islands, KY-1003
		

		
			Attention of: President
		

		
			if to the Trustee or the Collateral Agent:
		

		
			Wells Fargo Bank, National Association
		

		
			1445 Ross Avenue, Suite 4300
		

		
			MAC T9216-430
		

		
			Dallas, TX  75202
		

		
			Attention: Corporate, Municipal & Escrow Services
		

		
			Facsimile: (469) 729-7638
		

		
			The Company, any other Note Party or the Trustee or the Collateral Agent by notice to the other may designate additional or different addresses for subsequent notices or communications.
		

		
			Any notice or communication mailed (or, in the case of Global Securities, sent to the Depositary pursuant to Applicable Procedures) to a Holder shall be sent to the Holder at the Holder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so sent within the time prescribed.
		

		
			Failure to mail or otherwise send a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.  If a notice or communication is sent in the manner provided above, it is duly given, whether or not the addressee receives it.
		

		
			The Trustee and Collateral Agent agree to accept and act upon instructions or directions pursuant to this Indenture and any other Note Document sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods; provided,  however, that (a) the party providing such written instructions, subsequent to such transmission of written instructions, shall provide the originally executed instructions or directions to the Trustee and Collateral Agent, as applicable, in a timely manner, and such originally executed instructions or directions shall be signed by an authorized representative of the party providing such instructions or directions.  If the party elects to give the Trustee and Collateral Agent, as applicable, e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee and Collateral Agent, as applicable, in its discretion elects to act upon such instructions, the Trustee’s and Collateral Agent’s, as applicable, understanding of such instructions shall be deemed controlling.  The Trustee and Collateral Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s and Collateral Agent’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction.  The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee and Collateral Agent, including without limitation the risk of the Trustee and Collateral Agent acting on unauthorized instructions, and the risk or interception and misuse by third parties.
		

		
			
		

		
			

		 

		

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			SECTION 14.02. Certificate and Opinion as to Conditions Precedent.  Upon any request or application by the Company to the Trustee or the Collateral Agent to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee or the Collateral Agent:
		

		
			(1)         an Officer’s Certificate in form and substance reasonably satisfactory to the Trustee or the Collateral Agent stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and
		

		
			(2)         an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee or the Collateral Agent stating that, in the opinion of such counsel, all such conditions precedent, if any, have been complied with.
		

		
			SECTION 14.03. Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include:
		

		
			(1)         a statement that the individual making such certificate or opinion has read such covenant or condition;
		

		
			(2)         a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
		

		
			(3)         a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and
		

		
			(4)         a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.
		

		
			In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.
		

		
			Any certificate or opinion of an officer of any Note Party may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or opinion of, or representation by, counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of any Note Party stating that the information with respect to such factual matters is in the possession of such Note Party unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.
		

		
			Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.
		

		
			SECTION 14.04. Rules by Trustee, Paying Agent and Registrar.  The Trustee may make reasonable rules for action by or a meeting of Holders.  The Registrar and the Paying Agent may make reasonable rules for their functions.
		

		
			
		

		
			

		 

		

			86

		

 

		

			 

		

		

		
			SECTION 14.05. Legal Holidays.  If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.  If a regular record date is a Legal Holiday, the record date shall not be affected.
		

		
			SECTION 14.06. Governing Law.  This Indenture and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York.
		

		
			SECTION 14.07. No Recourse Against Others.  A director, officer, employee or stockholder, as such, of the Company or any other Note Party shall not have any liability for any obligations of the Company under the Securities or this Indenture or of such Note Party under its Securities Guarantee, this Indenture or other Note Document, as applicable, or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Holder shall waive and release all such liability.  The waiver and release shall be part of the consideration for the issue of the Securities.
		

		
			SECTION 14.08. Successors.  All agreements of the Company and the other Note Parties in this Indenture and the Securities shall bind their respective successors.  All agreements of the Trustee in this Indenture shall bind its successors.
		

		
			SECTION 14.09. Multiple Originals.  The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.  One signed copy is enough to prove this Indenture.  Delivery of an executed counterpart of a signature page to this Indenture by facsimile or other electronic transmission (e.g., a “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart thereof.
		

		
			SECTION 14.10. Table of Contents: Headings.  The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
		

		
			SECTION 14.11. Waiver of Jury Trial.  EACH OF THE COMPANY, THE OTHER NOTE PARTIES AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE SECURITIES OR THE TRANSACTION CONTEMPLATED HEREBY.
		

		
			SECTION 14.12. U.S.A. Patriot Act.
		

		
			The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.
		

		
			[SIGNATURE PAGES FOLLOW]
		

		
			 
		

		
			 
		

		

		 

		

			87

		

 

		

			 

		

	
					
						

					
						 

					
					
						    

					
					
						TRANSOCEAN GUARDIAN LIMITED, as Company

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Vice President, Asset Management

				

		
			
		

		

		 

		

			[Signature page to the Indenture]

		

 

		

			 

		

	
					
						

					
						 

					
					
						    

					
					
						TRANSOCEAN INC., as Guarantor

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Vice President, Asset Management

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						TRANSOCEAN LTD., as Guarantor

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Stephen L. Hayes

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Stephen L. Hayes

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Senior Vice President, Tax and Asset Management

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						TRANSOCEAN ENABLER LIMITED, as Guarantor

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Vice President, Asset Management

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						TRANSOCEAN ENCOURAGE LIMITED, as Guarantor

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Colin Berryman

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Vice President, Asset Management

				

		
			
		

		

		 

		

			[Signature page to the Indenture]

		

 

		

			 

		

	
					
						

					
						 

					
					
						    

					
					
						WELLS FARGO BANK, NATIONAL ASSOCIATION,  as Trustee and as Collateral Agent

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:

					
					
						/s/ Patrick Giordano

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:   Patrick Giordano

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:     Vice President

				

		
			 
		

		
			 
		

		
			

		 

		

			[Signature page to the Indenture]

		

 

		

			 

		

		

		
			Appendix A
		

		
			PROVISIONS RELATING TO SECURITIES
		

		
			1.          Definitions
		

		
			1.1        Definitions
		

		
			For the purposes of this Appendix the following terms shall have the meanings indicated below:
		

		
			“Depository” means The Depository Trust Company, its nominees and their respective successors.
		

		
			“Securities Act” means the Securities Act of 1933, as amended.
		

		
			“Securities Custodian” means the custodian with respect to a Global Security (as appointed by the Depository), or any successor Person thereto and shall initially be the Trustee.
		

		
			Capitalized terms used and not otherwise defined in this Appendix A shall have the meanings given to them in the Indenture.
		

		
			1.2        Other Definitions.
		

			
					
						Term

					
					
						    

					
					
						Defined in
Section:

				
	
					
						“144A Global Security”

					
					
						 

					
					
						2.1(a)

				
	
					
						“Agent Members”

					
					
						 

					
					
						2.1(b)

				
	
					
						“Global Security”

					
					
						 

					
					
						2.1(a)

				
	
					
						“Regulation S Global Security”

					
					
						 

					
					
						2.1(a)

				

		
			 
		

		
			2.          The Securities.
		

		
			2.1        (a)  Form and Dating.  The Securities shall be issued initially in the form of one or more permanent global restricted Securities in definitive, fully registered form (the “144A Global Security”) and one or more permanent global Regulation S Global Securities in definitive, fully registered form (the “Regulation S Global Security,” and together with the 144A Global Securities, each, a “Global Security”) with the applicable legends set forth herein, which shall be deposited on behalf of the purchasers of the Securities represented thereby with the Securities Custodian and registered in the name of the Depository or a nominee of the Depository, duly executed by the Company and authenticated by the Trustee as provided in this Indenture.  The aggregate principal amount of the Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depository or its nominee as hereinafter provided.
		

		
			(b)         Book-Entry Provisions.  This Section 2.1(b) shall apply only to a Global Security deposited with or on behalf of the Depository.
		

		
			The Company shall execute and the Trustee shall, in accordance with this Section 2.1(b), authenticate and deliver initially one or more Global Securities that (a) shall be registered in the name of the Depository for such Global Security or Global Securities or the nominee of such Depository and (b) shall be delivered by the Trustee to such Depository or pursuant to such Depository’s instructions or held by the Trustee as custodian for the Depository.
		

		
			Members of, or participants in, the Depository (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depository or by the Trustee as
		

		
			
		

		
			

		 

		

			Appendix A-1

		

 

		

			 

		

		

		
			the custodian of the Depository or under such Global Security, and the Company, the Trustee and any agent of the Company or the Trustee shall be entitled to treat the Depository as the absolute owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and its Agent Members, the operation of customary practices of such Depository governing the exercise of the rights of a holder of a beneficial interest in any Global Security.
		

		
			(c)         Certificated Securities.  Except as provided in this Section 2.1 or Section 2.3 or 2.4, owners of beneficial interests in Global Securities shall not be entitled to receive physical delivery of certificated Securities.
		

		
			2.2        Authentication.  The Trustee shall authenticate and deliver:  on the Issue Date, an aggregate principal amount of $750,000,000 5.875% Senior Secured Notes due 2024.
		

		
			2.3        Transfer and Exchange.
		

		
			(a)         Transfer and Exchange of Beneficial Interests in the Global Securities.  The transfer and exchange of beneficial interests in the Global Securities shall be effected through the Depositary in accordance with the provisions hereof and the Applicable Procedures; provided that no procedures set forth herein shall apply to transfers of beneficial interests within a Global Security.  Beneficial interests in Restricted Global Securities shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act.  Transfers of beneficial interests in Global Securities also shall require compliance with either clause (1) or (2) below, as applicable, as well as one or more of the other following clauses, as applicable:
		

		
			(1)         Transfer of Beneficial Interests in the Same Global Security.  Beneficial interests in any Restricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Security in accordance with the transfer restrictions set forth in the Private Placement Legend and any Applicable Procedures.  Beneficial interests in any Unrestricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security.  Except as may be required by any Applicable Procedures, no written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.3(a)(1).
		

		
			(2)         All Other Transfers and Exchanges of Beneficial Interests in Global Securities.  In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.3(a)(1) above, the transferor of any such beneficial interest must deliver to the Registrar either (A)(i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Security in an amount equal to the beneficial interest to be transferred or exchanged and (ii) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B) if permitted under Section 2.3(g) hereof, (i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Security in an amount equal to the beneficial interest to be transferred or exchanged and (ii) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Security shall be registered to effect the transfer or exchange referred to in (B)(i) above.  Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Securities contained in the Indenture and the Securities or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Security(s) pursuant to Section 2.3(g) hereof.
		

		
			
		

		
			

		 

		

			Appendix A-2

		

 

		

			 

		

		

		
			(3)         Transfer of Beneficial Interests in a Restricted Global Security to Another Restricted Global Security.  A beneficial interest in any Restricted Global Security may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Security if the transfer complies with the requirements of Section 2.3(a)(2) above and the Registrar receives the following:
		

		
			(A)        if the transferee will take delivery in the form of a beneficial interest in a 144A Global Security, then the transferor must deliver a certificate in the form of Appendix B hereto, including the certifications in item (1) thereof; and
		

		
			(B)        if the transferee will take delivery in the form of a beneficial interest in a Regulation S Global Security, then the transferor must deliver a certificate in the form of Appendix B hereto, including the certifications in item (2) thereof.
		

		
			(4)         Transfer and Exchange of Beneficial Interests in a Restricted Global Security for Beneficial Interests in an Unrestricted Global Security.  A beneficial interest in any Restricted Global Security may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Security or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security only if the exchange or transfer complies with the requirements of Section 2.3(a)(2) above and the Registrar receives the following:
		

		
			(A)        if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Appendix C hereto, including the certifications in item (1)(a) thereof; or
		

		
			(B)        if the holder of such beneficial interest in a Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Appendix B hereto, including the certifications in item (4) thereof; and, in each such case set forth in this clause 4, if the Company or the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Company and the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.
		

		
			If any such transfer is effected pursuant to this Section 2.3(a)(4) at a time when an Unrestricted Global Security has not yet been issued, the Company shall execute and the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to this Paragraph 4.
		

		
			(5)         Transfer or Exchange of Beneficial Interests in Unrestricted Global Securities for Beneficial Interests in Restricted Global Securities Prohibited.  Beneficial interests in an Unrestricted Global Security may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Security.
		

		
			(b)         Transfer or Exchange of Beneficial Interests in Global Securities for Definitive Securities.
		

		
			(1)         Beneficial Interests in Restricted Global Securities to Restricted Definitive Securities.  Subject to Section 2.4 hereof, if any holder of a beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a Restricted Definitive Security or to
		

		
			
		

		
			

		 

		

			Appendix A-3

		

 

		

			 

		

		

		
			transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Security, then, upon receipt by the Registrar of the following documentation:
		

		
			(A)        if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a Restricted Definitive Security, a certificate from such holder in the form of Appendix B hereto, including the certifications in item (2)(a) thereof;
		

		
			(B)        if such beneficial interest is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (1) thereof;
		

		
			(C)        if such beneficial interest is being transferred to a “non-U.S. Person” (as defined in Rule 902(k) of Regulation S) in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (2) thereof;
		

		
			(D)        if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (3)(a) thereof;
		

		
			(E)        if such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (3)(b) thereof,
		

		
			the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of the applicable Restricted Global Security, and the Company shall execute and the Trustee shall authenticate and deliver a Restricted Definitive Security in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder.  Any Restricted Definitive Security issued in exchange for a beneficial interest in a Restricted Global Security pursuant to this Section 2.3(b)(1) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions.  The Trustee shall deliver such Restricted Definitive Securities to the Persons in whose names such Securities are so registered.  Any Restricted Definitive Security issued in exchange for a beneficial interest in a Restricted Global Security pursuant to this Section 2.3(b)(1) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.
		

		
			(2)         Beneficial Interests in Restricted Global Securities to Unrestricted Definitive Securities.  Subject to Section 2.4 hereof, a holder of a beneficial interest in a Restricted Global Security may exchange such beneficial interest for an Unrestricted Definitive Security or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security only if the Registrar receives the following:
		

		
			(A)        if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for an Unrestricted Definitive Security, a certificate from such holder in the form of Appendix C hereto, including the certifications in item (1)(b) thereof; or
		

		
			(B)        if the holder of such beneficial interest in a Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in
		

		
			
		

		
			

		 

		

			Appendix A-4

		

 

		

			 

		

		

		
			the form of an Unrestricted Definitive Security, a certificate from such holder in the form of Appendix B hereto, including the certifications in item (4) thereof;
		

		
			and, in each such case set forth in this clause 2, if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Company and the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.
		

		
			Upon satisfaction of the conditions of this Section 2.3(b)(2) the Company shall execute, and the Trustee shall authenticate and deliver an Unrestricted Definitive Security in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder, and the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of the applicable Restricted Global Security.
		

		
			(3)         Beneficial Interests in Unrestricted Global Securities to Unrestricted Definitive Securities.  Subject to Section 2.4 hereof, if any holder of a beneficial interest in an Unrestricted Global Security proposes to exchange such beneficial interest for an Unrestricted Definitive Security or to transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security, then, upon satisfaction of the applicable conditions set forth in Section 2.3(a)(2) hereof, the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of the applicable Unrestricted Global Security, and the Company shall execute and the Trustee shall authenticate and deliver an Unrestricted Definitive Security in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder.  Any Unrestricted Definitive Security issued in exchange for a beneficial interest pursuant to this Section 2.3(b)(3) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions.  The Trustee shall deliver such Unrestricted Definitive Security to the Persons in whose names such Security is so registered.  Any Unrestricted Definitive Security issued in exchange for a beneficial interest pursuant to this Section 2.3(b)(3) shall not bear the Private Placement Legend.
		

		
			(c)         Transfer and Exchange of Definitive Securities for Beneficial Interests in Global Securities.
		

		
			(1)         Restricted Definitive Securities to Beneficial Interests in Restricted Global Securities.  If any holder of a Restricted Definitive Security proposes to exchange such Security for a beneficial interest in a Restricted Global Security or to transfer such Restricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Security, then, upon receipt by the Registrar of the following documentation:
		

		
			(A)        if the holder of such Restricted Definitive Security proposes to exchange such Security for a beneficial interest in a Restricted Global Security, a certificate from such holder in the form of Appendix C hereto, including the certifications in item (2)(b) thereof;
		

		
			(B)        if such Restricted Definitive Security is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (1) thereof; or
		

		
			
		

		
			

		 

		

			Appendix A-5

		

 

		

			 

		

		

		
			(C)        if such Restricted Definitive Security is being transferred to a “non-U.S. Person” (as defined in Rule 902(k) of Regulation S) in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Appendix B hereto, including the certifications in item (2) thereof,
		

		
			the Trustee shall cancel the Restricted Definitive Security, increase or cause to be increased in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Security, in the case of clause (B) above, a 144A Global Security, and in the case of clause (C) above, a Regulation S Global Security.
		

		
			(2)         Restricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities.  A holder of a Restricted Definitive Security may exchange such Security for a beneficial interest in an Unrestricted Global Security or transfer such Restricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security only if the Registrar receives the following:
		

		
			(A)        if the holder of such Restricted Definitive Security proposes to exchange such Security for a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Appendix C hereto, including the certifications in item (1)(c) thereof; or
		

		
			(B)        if the holder of such Restricted Definitive Security proposes to transfer such Security to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Appendix B hereto, including the certifications in item (4) thereof;
		

		
			and, in each such case set forth in this clause 2, if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Company and the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.
		

		
			Upon satisfaction of the conditions of this Section 2.3(c)(2), the Trustee shall cancel such Restricted Definitive Security and increase or cause to be increased in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of the Unrestricted Global Security.
		

		
			(3)         Unrestricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities.  A holder of an Unrestricted Definitive Security may exchange such Security for a beneficial interest in an Unrestricted Global Security or transfer such Unrestricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security at any time.  Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Security and increase or cause to be increased in a corresponding amount pursuant to Section 2.3(g) hereof the aggregate principal amount of one of the Unrestricted Global Securities.
		

		
			(4)         Transfer or Exchange of Unrestricted Definitive Securities to Beneficial Interests in Restricted Global Securities Prohibited.  An Unrestricted Definitive Security may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Security.
		

		
			(5)         Issuance of Unrestricted Global Securities.  If any such exchange or transfer of a Definitive Security for a beneficial interest in an Unrestricted Global Security is effected pursuant
		

		
			
		

		
			

		 

		

			Appendix A-6

		

 

		

			 

		

		

		
			to clause (2) or (3) above at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the principal amount of Definitive Securities so transferred.
		

		
			(d)         Transfer and Exchange of Definitive Securities for Definitive Securities.  Upon request by a holder of Definitive Securities and such holder’s compliance with the provisions of this Section 2.3(d), the Registrar shall register the transfer or exchange of Definitive Securities.  Prior to such registration of transfer or exchange, the requesting holder shall present or surrender to the Registrar the Definitive Securities duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such holder.  In addition, the requesting holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.3(d).
		

		
			(1)         Restricted Definitive Securities to Restricted Definitive Securities.  Any Restricted Definitive Security may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Security if the Registrar receives the following:
		

		
			(A)        if the transfer will be made pursuant to Rule 144A, a certificate in the form of Appendix B hereto, including the certifications in item (1) thereof;
		

		
			(B)        if the transfer will be made pursuant to Rule 903 or Rule 904, a certificate in the form of Appendix B hereto, including the certifications in item (2) thereof; and
		

		
			(C)        if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, a certificate in the form of Appendix B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable.
		

		
			(2)         Restricted Definitive Securities to Unrestricted Definitive Securities.  Any Restricted Definitive Security may be exchanged by the holder thereof for an Unrestricted Definitive Security or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Security only if the Registrar receives the following:
		

		
			(A)        if the holder of such Restricted Definitive Security proposes to exchange such Security for an Unrestricted Definitive Security, a certificate from such holder in the form of Appendix C hereto, including the certifications in item (1)(d) thereof; or
		

		
			(B)        if the holder of such Restricted Definitive Security proposes to transfer such Security to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Security, a certificate from such holder in the form of Appendix B hereto, including the certifications in item (4) thereof;
		

		
			and, in each such case set forth in this clause 2, if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Company and the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.
		

		
			Upon satisfaction of the conditions of this Section 2.3(d)(2) the Trustee shall cancel the prior Restricted Definitive Security and the Company shall execute, and the Trustee shall authenticate and deliver an Unrestricted Definitive Security in the appropriate principal amount to the Person designated by the holder of such prior Restricted Definitive Security in instructions delivered to the Registrar by such holder.
		

		
			
		

		
			

		 

		

			Appendix A-7

		

 

		

			 

		

		

		
			(3)         Unrestricted Definitive Securities to Unrestricted Definitive Securities.  A holder of an Unrestricted Definitive Security may transfer such Security to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security.  Upon receipt of a request to register such a transfer, the Registrar shall register such Unrestricted Definitive Security pursuant to the instructions from the Holder thereof.
		

		
			(e)         Legends.  The following legends shall appear on the face of all Global Securities and Definitive Securities issued under the Indenture unless specifically stated otherwise in the applicable provisions of the Indenture.
		

		
			(1)         Private Placement Legend.
		

		
			(A)        Except as permitted by clause (B) below, each Global Security and each Definitive Security (and all Securities issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form:
		

		
			“THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE  “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER (1) REPRESENTS THAT (A) IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT OR (B) IT IS NOT A U.S. PERSON (WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT) AND (2) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT IN ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ONLY (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR (2)(D) ABOVE, A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE) MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(E) ABOVE, THE COMPANY RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144 EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
		

		
			
		

		
			

		 

		

			Appendix A-8

		

 

		

			 

		

		

		
			THE FOLLOWING INFORMATION IS SUPPLIED SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES. THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) WITHIN THE MEANING OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), AND THIS LEGEND IS REQUIRED BY SECTION 1275(c) OF THE CODE. HOLDERS MAY OBTAIN INFORMATION REGARDING THE AMOUNT OF OID, THE ISSUE PRICE, THE ISSUE DATE AND THE YIELD TO MATURITY RELATING TO THE NOTES BY CONTACTING THE ISSUER’S VICE PRESIDENT, INVESTOR RELATIONS AT 1-713-232-7500.”
		

		
			(B)        Notwithstanding the foregoing, any Global Security or Definitive Security issued pursuant to clauses (b)(4), (c), (c)(3), (d)(2) or (d)(3) to this Section 2.3 (and all Securities issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend.
		

		
			(2)         Regulation S Legend.  Each Regulation S Global Security shall bear a legend in substantially the following form:
		

		
			“THE ACQUIRER AGREES FOR THE BENEFIT OF THE COMPANY THAT PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, ANY OFFER OR SALE OF THE NOTES SHALL NOT BE MADE BY IT TO A U.S. PERSON OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN THE MEANING OF RULE 902 OF REGULATION S.”
		

		
			 (3)        Global Security Legend.  Each Global Security shall bear a legend in substantially the following form:
		

		
			“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
		

		
			UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS
		

		
			
		

		
			

		 

		

			Appendix A-9

		

 

		

			 

		

		

		
			AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”
		

		
			(f)         Cancellation and/or Adjustment of Global Securities.  At such time as all beneficial interests in a particular Global Security have been exchanged for Definitive Securities or a particular Global Security has been redeemed, repurchased or cancelled in whole and not in part, each such Global Security shall be returned to or retained and cancelled by the Trustee in accordance with Section 2.10 of the Indenture.  At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security or for Definitive Securities, the principal amount of Securities represented by such Global Security shall be reduced accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security, such other Global Security shall be increased accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase.
		

		
			(g)         General Provisions Relating to Transfers and Exchanges.
		

		
			(1)         No service charge shall be made to a Holder of a beneficial interest in a Global Security or to a Holder of a Definitive Security for any registration of transfer or exchange, but the Company or the Trustee may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.06 and 2.09 of the Indenture).
		

		
			(2)         All Global Securities and Definitive Securities issued upon any registration of transfer or exchange of Global Securities or Definitive Securities shall be the valid obligations of the Company, evidencing the same Indebtedness, as the Global Securities or Definitive Securities surrendered upon such registration of transfer or exchange and shall be entitled to all of the benefits of the Indenture equally and proportionately with all other Securities duly issued hereunder.
		

		
			(3)         Neither the Registrar nor the Company shall be required (A) to issue, to register the transfer of or to exchange any Securities during a period beginning at the opening of business 15 days before the day of any selection of Securities for redemption under Section 3.02 of the Indenture and ending at the close of business on the date of selection, (B) to register the transfer of or to exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part or (C) to register the transfer of or to exchange a Security between a record date (including a regular record date) and the next succeeding interest payment date.
		

		
			(4)         Prior to due presentment for the registration of a transfer of any Security, the Trustee, any Agent and the Company may deem and treat the Person in whose name any Security is registered as the absolute owner of such Security for the purpose of receiving payment of
		

		
			
		

		
			

		 

		

			Appendix A-10

		

 

		

			 

		

		

		
			principal of and interest on such Security and for all other purposes, in each case regardless of any notice to the contrary.
		

		
			(5)         All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section to effect a registration of transfer or exchange may be submitted by facsimile.
		

		
			(6)         The Trustee is hereby authorized and directed to enter into a letter of representation with the Depositary in the form provided by the Company and to act in accordance with such letter.  The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under the Indenture under applicable law with respect to any transfer of any interest in any Security (including any transfer between or among Participants or other beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, the Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
		

		
			(7)         The transferor of any Security shall provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Section 6045 of the Code.  The Trustee may rely on information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.  In connection with any proposed exchange of a certificated Security for a Global Security, the Company or the Depositary shall be required to provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Section 6045 of the Code. The Trustee may rely on information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
		

		
			(h)         Notwithstanding any other provisions of this Appendix (other than the provisions set forth in Section 2.4 hereof), a Global Security may not be transferred as a whole except by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.
		

		
			(i)          No Obligation of the Trustee.
		

		
			(1)         The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in the Depository or other Person with respect to the accuracy of the records of the Depository or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than the Depository) of any notice (including any notice of redemption) or the payment of any amount, under or with respect to such Securities.  All notices and communications to be given to the Holders and all payments to be made to Holders under the Securities shall be given or made only to or upon the order of the registered Holders (which shall be the Depository or its nominee in the case of a Global Security).  The rights of beneficial owners in any Global Security shall be exercised only through the Depository subject to the applicable rules and procedures of the Depository.  The Trustee may rely and shall be fully protected in relying upon information furnished by the Depository with respect to its members, participants and any beneficial owners.
		

		
			(2)         The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or
		

		
			
		

		
			

		 

		

			Appendix A-11

		

 

		

			 

		

		

		
			among Depository participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
		

		
			2.4        Certificated Securities.
		

		
			(a)         A Global Security deposited with the Depository or with the Trustee as Securities Custodian for the Depository pursuant to Section 2.1 hereof shall be transferred to the beneficial owners thereof in the form of certificated Securities in an aggregate principal amount equal to the principal amount of such Global Security, in exchange for such Global Security, only if such transfer complies with Section 2.3 hereof and (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository for such Global Security and the Depository fails to appoint a successor depository or if at any time such Depository ceases to be a “clearing agency” registered under the Exchange Act, in either case, and a successor depository is not appointed by the Company within 90 days of such notice, or (ii) an Event of Default has occurred and is continuing or (iii) the Company, in its sole discretion, notifies the Trustee in writing that it elects to cause the issuance of certificated Securities under this Indenture.
		

		
			(b)         Any Global Security that is transferable to the beneficial owners thereof pursuant to this Section 2.4 shall be surrendered by the Depository to the Trustee located at its principal Corporate Trust Office in the Borough of Manhattan, The City of New York, to be so transferred, in whole or from time to time in part, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Security, an equal aggregate principal amount of certificated Securities of authorized denominations.  Any portion of a Global Security transferred pursuant to this Section 2.4 shall be executed, authenticated and delivered only in denominations of a minimum principal amount of $2,000 and any integral multiple of $1,000 in excess thereof and registered in such names as the Depository shall direct.
		

		
			(c)         Subject to the provisions of Section 2.4(b) hereof, the registered Holder of a Global Security shall be entitled to grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.
		

		
			(d)         In the event of the occurrence of one of the events specified in Section 2.4(a) hereof, the Company shall promptly make available to the Trustee a reasonable supply of certificated Securities in definitive, fully registered form without interest coupons.
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix A-12

		

 

		

			 

		

		

		
			EXHIBIT 1.1
		

		
			to
		

		
			APPENDIX A
		

		
			[FORM OF FACE OF SECURITY]
		

		
			[Global Securities Legend]
		

		
			THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER (1) REPRESENTS THAT (A) IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT OR (B) IT IS NOT A U.S. PERSON (WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT) AND (2) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT IN ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ONLY (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR (2)(D) ABOVE, A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE) MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(E) ABOVE, THE COMPANY RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144 EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
		

		
			[THE ACQUIRER AGREES FOR THE BENEFIT OF THE COMPANY THAT PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, ANY OFFER OR SALE OF THE NOTES SHALL NOT BE MADE BY IT TO A U.S. PERSON OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN THE MEANING OF RULE 902 OF REGULATION S.]1
		

		
			THE FOLLOWING INFORMATION IS SUPPLIED SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES. THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT ( “OID”) WITHIN THE MEANING OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), AND THIS LEGEND IS REQUIRED BY SECTION 1275(c) OF THE CODE. HOLDERS MAY OBTAIN INFORMATION REGARDING THE AMOUNT OF OID, THE ISSUE PRICE, THE
		

		

		
			1         Include for Regulation S Global Securities
		

		
			
		

		
			

		 

		

			Exhibit 1.1-1

		

 

		

			 

		

		

		
			ISSUE DATE AND THE YIELD TO MATURITY RELATING TO THE NOTES BY CONTACTING THE ISSUER’S VICE PRESIDENT, INVESTOR RELATIONS AT 1-713-232-7500.
		

		
			THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
		

		
			UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
		

		
			 
		

			
					
						No.

					
					
						 

					
					
						 

					
					
						$

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						CUSIP NO.

				
	
					
						 

					
					
						ISIN NO.

				

		
			 
		

		
			TRANSOCEAN GUARDIAN LIMITED
		

		
			5.875% Senior Secured Notes due 2024
		

		
			Transocean Guardian Limited, a Cayman Islands exempted company (herein called the “Company”, which term includes any Successor Company under the Indenture hereinafter referred to), for value received, promises to pay to CEDE & CO., or its registered assigns, the principal sum of                                        UNITED STATES DOLLARS ($           ), subject to adjustments listed on the Schedule of Increases or Decreases in Global Security attached hereto, on January 15, 2024.
		

		
			Interest Rate: 5.875% per annum
		

		
			Interest Payment Dates:  January 15 and July 15.
		

		
			Record Dates: January 1 and July 1.
		

		
			Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
		

		
			
		

		
			

		 

		

			Exhibit 1.1-2

		

 

		

			 

		

		

		
			 
		

		
			[SIGNATURE PAGE FOLLOWS]
		

		
			
		

		
			

		 

		

			Exhibit 1.1-3

		

 

		

			 

		

		

		
			IN WITNESS WHEREOF, the Company has caused this Security to be signed manually or by facsimile by its duly authorized officer.
		

			
					
						Dated:

					
					
						 

					
					
						    

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						TRANSOCEAN GUARDIAN LIMITED

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						By:  

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Name:

				
	
					
						 

					
					
						 

					
					
						 

					
					
						Title:

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			TRUSTEE’S CERTIFICATE OF AUTHENTICATION
		

		
			This is one of the 5.875% Senior Secured Notes due 2024 described in the within-mentioned Indenture.
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION
		

		
			as Trustee
		

			
					
						By:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Authorized Signatory

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Dated:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Exhibit 1.1-4

		

 

		

			 

		

		

		
			[FORM OF REVERSE SIDE SECURITY]
		

		
			TRANSOCEAN GUARDIAN LIMITED
		

		
			5.875% Senior Secured Notes due 2024
		

		
			Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.
		

		
			1.          INTEREST.  Transocean Guardian Limited (the “Company”) promises to pay interest on the principal amount of this Security at 5.875% per annum.  The Company shall pay interest semi-annually in arrears on January 15 and July 15 of each year, commencing January 15, 2019.  Interest on the Securities shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from July 13, 2018.  Interest shall be computed on the basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue principal, interest and other overdue amounts at a rate per annum equal to the rate which is 2.00% in excess of the rate which would have been payable if such overdue amount had, during the period of non-payment, constituted an outstanding amount of the Securities.  Such interest shall be payable in accordance with Section 2.11 of the Indenture.
		

		
			2.          METHOD OF PAYMENT.  The Company shall pay interest on the Securities (except defaulted interest) to the Persons who are registered Holders of Securities at the close of business on the January 1 and July 1 next preceding the interest payment date even if such Securities are canceled after the record date and on or before the interest payment date.  Holders must surrender Securities to a Paying Agent to collect principal payments.  The Company shall pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Payments in respect of the Securities represented by a Global Security (including principal, premium and interest) shall be made by wire transfer of immediately available funds to the accounts specified by the Depository.  The Company shall make all payments in respect of a certificated Security (including principal, premium and interest) by mailing a check to the registered address of each Holder thereof; provided,  however, that payments on a certificated Security shall be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
		

		
			3.          PAYING AGENT AND REGISTRAR.  Initially, Wells Fargo Bank, National Association, a national banking association duly organized and existing under the laws of the United States of America (the “Trustee”), shall act as Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice.  The Company or any of its Affiliates incorporated or organized within The United States of America may act as Paying Agent, Registrar or co-registrar.
		

		
			4.          INDENTURE.  The Company issued the Securities under an Indenture dated as of July 13, 2018 (the “Indenture”), among the Company, the Guarantors, the Trustee and the Collateral Agent.  This Security is one of a duly authorized issue of notes of the Company designated as its 5.875% Senior Secured Notes due 2024, initially issued in the aggregate principal amount of $750,000,000.  The terms of the Securities include those stated in the Indenture, and Holders are referred to the Indenture for a statement of those terms (which for greater certainty includes the right of exchange of the Securities provided in Appendix A to the Indenture, which is an express term of this Security).  To the extent any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
		

		
			
		

		
			

		 

		

			Exhibit 1.1-5

		

 

		

			 

		

		

		
			5.          OPTIONAL REDEMPTION.
		

		
			(i)          On or prior to July 15, 2021, the Company shall be entitled at its option to redeem the Securities, in whole or in part, at a redemption price equal to 100% of the principal amount of the Securities plus the Make-Whole Premium as of, and accrued and unpaid interest, if any, to (but not including), the redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).
		

		
			(ii)         After July 15, 2021, the Company shall be entitled at its option to redeem the Securities, in whole or in part, at the redemption prices applicable to the Securities (expressed as a percentage of principal amount of the Securities to be redeemed) set forth below, plus accrued and unpaid interest thereon to, but not including, the date of redemption (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date) if redeemed during the periods indicated below:
		

			
					
						Period

					
					
						Percentage

				
	
					
						July 16, 2021 to July 15, 2022

					
					
						102.938%

				
	
					
						July 16, 2022 to July 15, 2023

					
					
						101.469%

				
	
					
						July 16, 2023 and thereafter

					
					
						100.000%

				

		
			 
		

		
			6.          MANDATORY REDEMPTION.  The Securities are subject to mandatory redemption as described in Section 3.09 of the Indenture.
		

		
			7.          CHANGE OF CONTROL REPURCHASE EVENT.  Upon the occurrence of a Change of Control Repurchase Event, unless the Company shall have exercised its option pursuant to Section 5 hereof to redeem the Securities, the Company will be required to make an offer to each Holder of the Securities, to repurchase all or any part (in denominations of a minimum principal amount of $2,000 and integral multiples of $1,000 in excess thereof) of that Holder’s Securities at a repurchase price in cash equal to 101% of the aggregate principal amount of the Securities to be repurchased plus any accrued and unpaid interest on such Securities to, but excluding, the repurchase date.
		

		
			8.          GUARANTEE.  The payment by the Company of the principal of, and premium including the Make-Whole Premium, if any, and interest on, the Securities is fully and unconditionally guaranteed on a joint and several senior basis by each of the Guarantors to the extent set forth in the Indenture.
		

		
			9.          DENOMINATIONS; TRANSFER; EXCHANGE.  The Securities are in registered form without coupons in denominations of a minimum principal amount of $2,000 and integral multiples of $1,000 in excess thereof.  A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and the Company will require a Holder to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be redeemed) or any Securities for a period of 15 days before a selection of Securities to be redeemed or 15 days before an interest payment date.  Transfer may be restricted as provided in the Indenture.
		

		
			10.        PERSONS DEEMED OWNERS.  The registered Holder of this Security may be treated as the owner of it for all purposes.
		

		
			11.        UNCLAIMED MONEY.  If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request
		

		
			
		

		
			

		 

		

			Exhibit 1.1-6

		

 

		

			 

		

		

		
			unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.
		

		
			12.        DISCHARGE AND DEFEASANCE.  Subject to certain conditions, the Company at any time shall be entitled to terminate some or all of its and any other Note Parties’ obligations under the Securities, the Securities Guarantees, the Indenture and the other Note Documents with respect to the Securities (including the Securities Guarantees) if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity (after deducting therefrom the amount contained in the Debt Service Reserve Account as of such date), as the case may be.
		

		
			13.        AMENDMENT; SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture, the Securities and the other Note Documents  may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Outstanding Securities (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities), and any existing default or compliance with any provision of the Indenture, the Securities or the other Note Documents may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Securities (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities).  Without the consent of any Holder of Securities, the Indenture, the Securities or the Security Documents may be amended or supplemented to, among other things, cure any ambiguity, to correct or supplement any provision which may be inconsistent with any other provision, or to make any other provisions with respect to matters or questions arising under the Indenture or other Note Documents, provided such action shall not adversely affect the interests of the Holders in any material respect, to release, terminate or discharge, or to confirm and evidence the release, termination or discharge of, any Collateral or any Securities Guarantee when permitted or required by this Indenture or the Security Documents or to amend or supplement any Security Document in accordance with the Indenture or the Security Document, including, without limitation, upon the replacement of a Collateral Rig Owner or in connection with a transfer of the Drilling Contract, in each case, in accordance with the Indenture.
		

		
			14.        DEFAULTS AND REMEDIES.  The Events of Default relating to the Securities are defined in Section 6.01 of the Indenture.  Upon the occurrence of an Event of Default, the rights and obligations of the Company, the other Note Parties, the Trustee and the Holders shall be as set forth in the applicable provisions of the Indenture or other applicable Note Document.
		

		
			15.        TRUSTEE DEALINGS WITH COMPANY.  The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may become a creditor of, or otherwise deal with the Company or any of its Affiliates, with the same rights it would have if it were not Trustee.
		

		
			16.        NO RECOURSE AGAINST OTHERS.  A director, officer, employee or stockholder, as such, of the Company or any other Note Party shall not have any liability for any obligations of the Company under the Securities or this Indenture or of such Note Party under its Securities Guarantee, this Indenture or any other Note Document, as applicable, or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Holder shall waive and release all such liability.  By accepting a Security, each Holder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
		

		
			17.        SECURITY DOCUMENTS. The obligations of the Company and the other Note Parties under the Indenture, the Securities and the Security Documents will be secured by a Lien granted to the Collateral Agent on the Collateral.
		

		
			
		

		
			

		 

		

			Exhibit 1.1-7

		

 

		

			 

		

		

		
			18.        AUTHENTICATION.  This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Security.
		

		
			19.        ABBREVIATIONS.  Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
		

		
			20.        CUSIP NUMBERS.  Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders of Securities.  No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
		

		
			21.        GOVERNING LAW.  THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
		

		
			The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture.  Requests may be made to:
		

		
			Transocean Guardian Limited
		

		
			c/o Transocean Inc.
		

		
			70 Harbour Drive
		

		
			P.O. Box 10342
		

		
			Cayman Islands, KY-1003
		

		
			Attention:  President
		

		
			
		

		
			

		 

		

			Exhibit 1.1-8

		

 

		

			 

		

		

		
			ASSIGNMENT FORM
		

		
			To assign this Security, fill in the form below:
		

		
			I or we assign and transfer this
		

			
					
						Security to:  

					
					
						 

				
	
					
						(Insert assignee’s legal name)

				
	
					
						 

				
	
					
						(Insert assignee’s soc. sec. or tax I.D. no.)

				
	
					
						 

				
	
					
						 

				
	
					
						 

				
	
					
						(Print or type assignee’s name, address and zip code)

				

		
			 
		

		
			and irrevocably appoint                                                                                        as agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.
		

			
					
						Dated:  

					
					
						 

					
					
						    

					
					
						Your 

					
					
						Signature:

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						(Sign exactly as your name appears on the other side of this Security.)

				

		
			 
		

			
					
						Signature

					
					
						 

				
	
					
						Guarantee:

					
					
						 

				
	
					
						 

					
					
						(Signature must be guaranteed)

				

		
			 
		

		
			Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
		

		
			
		

		
			

		 

		

			Exhibit 1.1-9

		

 

		

			 

		

		

		
			[TO BE ATTACHED TO GLOBAL SECURITIES]
		

		
			SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
		

		
			The following increases or decreases in this Global Security have been made:
		

			
					
						A

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Date of Exchange

					
					
						    

					
					
						Amount of
decrease in
Principal amount 
of this Global
Security

					
					
						    

					
					
						Amount of
increase in
Principal amount
of this Global
Security

					
					
						    

					
					
						Principal Amount
of this Global
Security following
such decrease or
increase)

					
					
						    

					
					
						Signature of
authorized officer
of Trustee or
Securities Custodian

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Exhibit 1.1-10

		

 

		

			 

		

		

		
			OPTION OF HOLDER TO ELECT PURCHASE
		

		
			If you want to elect to have this Security purchased by the Company pursuant to Section 4.02 of the Indenture, check the box:
		

		
			☐ 4.02
		

		
			If you want to elect to have only part of this Security purchased by the Company pursuant to Section 4.03 of the Indenture, state the amount in principal amount:  $                              
		

			
					
						Dated:  

					
					
						 

					
					
						    

					
					
						Your 

					
					
						Signature:

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						(Sign exactly as your name appears on the other side of this Security.)

				

		
			 
		

			
					
						Signature

					
					
						 

				
	
					
						Guarantee:

					
					
						 

				
	
					
						 

					
					
						(Signature must be guaranteed)

				

		
			 
		

		
			Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			 
		

		
			

		 

		

			Exhibit 1.1-11

		

 

		

			 

		

		

		
			APPENDIX B
		

		
			FORM OF CERTIFICATE OF TRANSFER
		

		
			Transocean Guardian Limited
		

		
			c/o Transocean Inc.
		

		
			70 Harbour Drive
		

		
			P.O. Box 10342
		

		
			Cayman Islands, KY-1003
		

		
			Attention:  President
		

		
			Wells Fargo Bank, National Association
		

		
			Corporate Trust – DAPS REORG
		

		
			600 Fourth Street South, 7th Floor
		

		
			MAC N9300-070
		

		
			Minneapolis, MN 55415
		

		
			Phone: 1-800-344-5128
		

		
			Fax: 1-866-969-1290
		

		
			Email: dapsreorg@wellsfargo.com
		

		
			 
		

		
			Re:       5.875% Senior Secured Notes due 2024
		

		
			Reference is hereby made to the Indenture, dated as July 13, 2018 (the “Indenture”), among Transocean Guardian Limited, as issuer (the “Company”), the Other Note Parties party thereto and Wells Fargo Bank, National Association, as Trustee and as Collateral Agent.  Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
		

		
			                                          , (the “Transferor”) owns and proposes to transfer the Security[ies] or interest in such Security[ies] specified in Annex A hereto, in the principal amount of $                                in such Security[ies] or interests (the “Transfer”), to                                            (the “Transferee”), as further specified in Annex A hereto.  In connection with the Transfer, the Transferor hereby certifies that:
		

		
			[CHECK ALL THAT APPLY]
		

		
			1.          ☐           Check if Transferee will take delivery of a beneficial interest in the 144A Global Security or a Definitive Security Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Security is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Security for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Security and/or the Definitive Security and in the Indenture and the Securities Act.
		

		
			2.          ☐           Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Security or a Definitive Security pursuant to Regulation S.  The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
		

		
			
		

		
			

		 

		

			Appendix B-1

		

 

		

			 

		

		

		
			hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S under the Securities Act, and (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.  Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Regulation S Global Security and/or the Definitive Security and in the Indenture and the Securities Act.
		

		
			3.          ☐           Check and complete if Transferee will take delivery of a Definitive Security pursuant to any provision of the Securities Act other than Rule 144A or Regulation S.  The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Security and Restricted Definitive Security and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one):
		

		
			(a)         ☐           such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;
		

		
			or
		

		
			(b)         ☐          such Transfer is being effected to the Company or any of its Subsidiaries;
		

		
			or
		

		
			(c)         ☐           such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act.
		

		
			4.          ☐           Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Security or of an Unrestricted Definitive Security.
		

		
			(a)         ☐           Check if Transfer is pursuant to Rule 144.  (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Security, on Restricted Definitive Security and in the Indenture.
		

		
			(b)         ☐          Check if Transfer is Pursuant to Regulation S.  (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred
		

		
			
		

		
			

		 

		

			Appendix B-2

		

 

		

			 

		

		

		
			beneficial interest or Definitive Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Security, on Restricted Definitive Security and in the Indenture.
		

		
			(c)         ☐           Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Security will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Security or Restricted Definitive Security and in the Indenture.
		

		
			This certificate and the statements contained herein are made for your benefit and the benefit of the Company.
		

			
					
						 

					
					
						[Insert Name of Transferor]

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

				
	
					
						 

					
					
						 

					
					
						Title:

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Dated:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix B-3

		

 

		

			 

		

		

		
			ANNEX A TO CERTIFICATE OF TRANSFER
		

		
			1.          The Transferor owns and proposes to transfer the following:
		

		
			[CHECK ONE OF (a) OR (b)]
		

		
			(a)         ☐ a beneficial interest in the:
		

		
			(i)          ☐ 144A Global Security (CUSIP                             ), or
		

		
			(ii)         ☐ Regulation S Global Security (CUSIP                            ); or
		

		
			(b)         ☐ a Restricted Definitive Security.
		

		
			2.          After the Transfer the Transferee will hold:
		

		
			[CHECK ONE OF (a), (b) OR (c)]
		

		
			(a)         ☐ a beneficial interest in the:
		

		
			(i)          ☐ 144A Global Security (CUSIP                            ), or
		

		
			(ii)         ☐ Regulation S Global Security (CUSIP                            ), or
		

		
			(iii)        ☐ Unrestricted Global Security (CUSIP                             ); or
		

		
			(b)         ☐ a Restricted Definitive Security; or
		

		
			(c)         ☐ an Unrestricted Definitive Security,
		

		
			in accordance with the terms of the Indenture.
		

		
			 
		

		
			 
		

		
			

		 

		

			Annex A-1

		

 

		

			 

		

		

		
			APPENDIX C
		

		
			FORM OF CERTIFICATE OF EXCHANGE
		

		
			Transocean Guardian Limited
		

		
			c/o Transocean Inc.
		

		
			70 Harbour Drive
		

		
			P.O. Box 10342
		

		
			Cayman Islands, KY-1003
		

		
			Attention:  President
		

		
			Wells Fargo Bank, National Association
		

		
			Corporate Trust – DAPS REORG
		

		
			600 Fourth Street South, 7th Floor
		

		
			MAC N9300-070
		

		
			Minneapolis, MN 55415
		

		
			Phone: 1-800-344-5128
		

		
			Fax: 1-866-969-1290
		

		
			Email: dapsreorg@wellsfargo.com
		

		
			 
		

		
			Re:        5.875% Senior Secured Notes due 2024
		

		
			 
		

		
			Reference is hereby made to the Indenture, dated as July 13, 2018 (the “Indenture”), among Transocean Guardian Limited, as issuer (the “Company”), the Other Note Parties party thereto and Wells Fargo Bank, National Association, as Trustee and as Collateral Agent.  Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
		

		
			                                                  , (the “Owner”) owns and proposes to exchange the Security[ies] or interest in such Security[ies] specified herein, in the principal amount of $                      in such Security[ies] or interests (the “Exchange”).  In connection with the Exchange, the Owner hereby certifies that:
		

		
			1.          Exchange of Restricted Definitive Securities or Beneficial Interests in a Restricted Global Security for Unrestricted Definitive Securities or Beneficial Interests in an Unrestricted Global Security evidencing the same indebtedness as the Restricted Global Security
		

		
			(a)         ☐           Check if Exchange is from beneficial interest in a Restricted Global Security to beneficial interest in an Unrestricted Global Security.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for a beneficial interest in an Unrestricted Global Security in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Security and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the “Securities Act”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Security is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
		

		
			(b)         ☐          Check if Exchange is from beneficial interest in a Restricted Global Security to Unrestricted Definitive Security.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for an Unrestricted Definitive Security, the Owner hereby certifies (i) the Unrestricted Definitive Security is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Security and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer
		

		
			
		

		
			

		 

		

			Appendix C-1

		

 

		

			 

		

		

		
			contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Security is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
		

		
			(c)         ☐           Check if Exchange is from Restricted Definitive Security to beneficial interest in an Unrestricted Global Security.  In connection with the Owner’s Exchange of a Restricted Definitive Security for a beneficial interest in an Unrestricted Global Security, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Security and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
		

		
			(d)         ☐          Check if Exchange is from Restricted Definitive Security to Unrestricted Definitive Security.  In connection with the Owner’s Exchange of a Restricted Definitive Security for an Unrestricted Definitive Security, the Owner hereby certifies (i) the Unrestricted Definitive Security is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Security and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Security is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
		

		
			2.          Exchange of Restricted Definitive Securities or Beneficial Interests in Restricted Global Securities for Restricted Definitive Securities or Beneficial Interests in Restricted Global Securities
		

		
			(a)         ☐           Check if Exchange is from beneficial interest in a Restricted Global Security to Restricted Definitive Security.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Security for a Restricted Definitive Security with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Security is being acquired for the Owner’s own account without transfer.  Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Security issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Security and in the Indenture and the Securities Act.
		

		
			(b)         ☐          Check if Exchange is from Restricted Definitive Security to beneficial interest in a Restricted Global Security.  In connection with the Exchange of the Owner’s Restricted Definitive Security for a beneficial interest in the [CIRCLE ONE] 144A Global Security or Regulation S Global Security with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Definitive Security and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States.  Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Security and in the Indenture and the Securities Act.
		

		
			
		

		
			

		 

		

			Appendix C-2

		

 

		

			 

		

		

		
			This certificate and the statements contained herein are made for your benefit and the benefit of the Company.
		

			
					
						 

					
					
						[Insert Name of Transferor]

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

				
	
					
						 

					
					
						 

					
					
						Title:

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Dated:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix C-3

		

 

		

			 

		

		

		
			APPENDIX D
		

		
			FORM OF SUPPLEMENTAL INDENTURE
		

		
			This SUPPLEMENTAL INDENTURE, dated as of [                    ] (this “Supplemental Indenture”) is among Transocean Guardian Limited, (the “Company”), [                    ] (the “Additional Guarantor”), which is a subsidiary of Transocean Ltd., each of the other existing Note Parties (as defined in the Indenture referred to below) and Wells Fargo Bank, National Association, as Trustee.
		

		
			RECITALS
		

		
			WHEREAS, the Company, the other Note Parties and the Trustee entered into an Indenture, dated as of July 13, 2018 (as heretofore amended, supplemented or otherwise modified, the “Indenture”), providing for the issuance of the Company’s 5.875% Senior Secured Notes due 2024 (the “Securities”);
		

		
			WHEREAS, the Indenture provides that under certain circumstances the Additional Guarantor shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Additional Guarantor shall become a Guarantor (as defined in the Indenture); and
		

		
			WHEREAS, Section 10.01(d) of the Indenture provides that the Company, the other Note Parties and the Trustee may amend or supplement the Indenture in order to add any additional Guarantor with respect to the Securities, without the consent of the Holders of the Securities;
		

		
			NOW, THEREFORE, to comply with the provisions of the Indenture and in consideration of the above premises, the Company, the Additional Guarantor, the other Note Parties and the Trustee covenant and agree for the equal and proportionate benefit of the respective Holders of the Securities as follows:
		

		
			Section 1. Capitalized Terms. Capitalized terms used herein without definition shall have the meanings ascribed to them in the Indenture.
		

		
			Section 2. Relation to Indenture. This Supplemental Indenture is supplemental to the Indenture and does and shall be deemed to form a part of, and shall be construed in connection with and as part of, the Indenture for any and all purposes.
		

		
			Section 3. Effectiveness of Supplemental Indenture. This Supplemental Indenture shall become effective immediately upon its execution and delivery by each of the Company, the Additional Guarantor, the other Note Parties and the Trustee.
		

		
			Section 4. Agreement to Guarantee. The Additional Guarantor hereby agrees to, and by its execution of this Supplemental Indenture hereby does, become a party to the Indenture as a Guarantor and as such shall have all of the rights and is bound by the provisions of the Indenture applicable to Guarantors to the extent provided for and subject to the limitations therein, including Article 11 thereof.  The Additional Guarantor hereby unconditionally and irrevocably guarantees, jointly and severally, on a senior basis to each Holder and to the Trustee and its successors and assigns (a) the full and punctual payment of principal of and interest on the Securities when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company under the Indenture with respect to the Securities and (b) the full and punctual performance within applicable grace periods of all other obligations of the Company under the Indenture with respect to the Securities.
		

		
			Section 5. Ratification of Obligations. Except as specifically modified herein, the Indenture and the Securities are in all respects ratified and confirmed (mutatis mutandis) and shall remain in full force and effect in accordance with their terms.
		

		
			
		

		
			

		 

		

			Appendix D-1

		

 

		

			 

		

		

		
			Section 6. The Trustee. Except as otherwise expressly provided herein, no duties, responsibilities or liabilities are assumed, or shall be construed to be assumed, by the Trustee by reason of this Supplemental Indenture. This Supplemental Indenture is executed and accepted by the Trustee subject to all the terms and conditions set forth in the Indenture with the same force and effect as if those terms and conditions were repeated at length herein and made applicable to the Trustee with respect hereto. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.
		

		
			Section 7. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
		

		
			Section 8. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of such executed copies together shall represent the same agreement. Signature of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.
		

		
			[Signatures on following pages]
		

		
			 
		

			
					
						 

					
					
						COMPANY:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						TRANSOCEAN GUARDIAN LIMITED

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

				
	
					
						 

					
					
						 

					
					
						Title:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						ADDITIONAL GUARANTOR:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						[                       ]

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

				
	
					
						 

					
					
						 

					
					
						Title:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						EXISTING NOTE PARTIES:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						[Insert signature blocks for each of the Note Parties existing at the time of execution of this Supplemental Indenture]

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						TRUSTEE:

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix D-2

		

 

		

			 

		

		

		
			APPENDIX E-1
		

		
			FORM OF NORWEGIAN SHARE PLEDGE AGREEMENT
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-1

		

 

		

			 

		

		

		
			 
		

			
					
						FORM OF

					
					
						 

				
	
					
						SECURITY AGREEMENT

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						dated 13 July 2018

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						between

					
					
						Songa Offshore SE as Pledgor

				
	
					
						 

					
					
						 

				
	
					
						and

					
					
						Wells Fargo Bank, National Association, as pledgee and Collateral Agent

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in respect of the shares in Songa Offshore Rig 3 AS

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-2

		

 

		

			 

		

		

		
			Table of Contents
		

			
					
						1.

					
					
						    

					
					
						INTERPRETATION

					
					
						    

					
					
						4 

				
	
					
						2.

					
					
						 

					
					
						PLEDGE OF SHARES

					
					
						 

					
					
						5 

				
	
					
						3.

					
					
						 

					
					
						LIMITATION

					
					
						 

					
					
						6 

				
	
					
						4.

					
					
						 

					
					
						REPRESENTATIONS AND WARRANTIES

					
					
						 

					
					
						6 

				
	
					
						5.

					
					
						 

					
					
						UNDERTAKINGS

					
					
						 

					
					
						7 

				
	
					
						6.

					
					
						 

					
					
						CONTINUING SECURITY

					
					
						 

					
					
						7 

				
	
					
						7.

					
					
						 

					
					
						DIVIDENDS AND VOTING RIGHTS

					
					
						 

					
					
						7 

				
	
					
						8.

					
					
						 

					
					
						ENFORCEMENT

					
					
						 

					
					
						8 

				
	
					
						9.

					
					
						 

					
					
						APPLICATION OF PROCEEDS

					
					
						 

					
					
						9 

				
	
					
						10.

					
					
						 

					
					
						WAIVER OF DEFENCES

					
					
						 

					
					
						9 

				
	
					
						11.

					
					
						 

					
					
						DELEGATION

					
					
						 

					
					
						11 

				
	
					
						12.

					
					
						 

					
					
						RELEASE OF SECURITY

					
					
						 

					
					
						11 

				
	
					
						13.

					
					
						 

					
					
						ASSIGNMENT

					
					
						 

					
					
						11 

				
	
					
						14.

					
					
						 

					
					
						COUNTERPARTS

					
					
						 

					
					
						12 

				
	
					
						15.

					
					
						 

					
					
						SEVERABILITY

					
					
						 

					
					
						12 

				
	
					
						16.

					
					
						 

					
					
						GOVERNING LAW AND JURISDICTION

					
					
						 

					
					
						12 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						SCHEDULE 1 A FORM OF NOTICE OF SHARE PLEDGE

				
	
					
						SCHEDULE 1 B FORM OF ACKNOWLEDGEMENT OF NOTICE OF SHARE PLEDGE

				
	
					
						SCHEDULE 2 FORM OF POWER OF ATTORNEY

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-3

		

 

		

			 

		

		

		
			THIS SECURITY AGREEMENT (the "Agreement") is entered into on 13 July 2018 between:
		

		
			 
		

		
			(1)           SONGA OFFSHORE SE, Porto Bello Building, Office 201, No. 1 Siafi Street, Limassol, 304, Cyprus, with registration number SE9 as pledgor (the "Pledgor"); and
		

		
			(2)           WELLS FARGO BANK, NATIONAL ASSOCIATION, as pledgee and collateral agent (together with its successors and assigns acting in such capacity under the Indenture defined below, the “Collateral Agent”).
		

		
			WHEREAS:
		

		
			 
		

		
			(A)          A certain indenture, dated as of July 13, 2018 (as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Indenture”), has been entered into among Transocean Guardian Limited, a Cayman Islands exempted company, as the issuer, the other Guarantors listed therein and Wells Fargo Bank, National Association as trustee and Collateral Agent;
		

		
			(B)          The Company has a registered share capital of NOK 30,000, consisting of 30 shares, each with a nominal value of NOK 1,000.
		

		
			(C)          The Pledgor is the holder of all shares of the Company;
		

		
			(D)          The Pledgor has agreed to secure the Secured Obligations by a pledge in respect of the Shares.
		

		
			NOW THEREFORE:
		

		
			1.            INTERPRETATION
		

		
			1.1          Terms and expressions
		

		
			In this Agreement (including the preamble hereto), the terms and expressions defined in the Indenture shall have the meaning given to them therein, unless otherwise specified in this Agreement.
		

		
			1.2          Definitions
		

		
			In this Agreement:
		

		
			 
		

		
			"Companies Act" means the Norwegian Private Limited Liability Companies Act of 1997 No. 44 as amended from time to time.
		

		
			"Company" means Songa Offshore Rig 3 AS, a Norwegian private limited liability company with registered address Maskinveien 26, NO-4033 Stavanger, Norway, and registration no. 913 292 073.
		

		
			"Enforcement Act" means the Norwegian Enforcement Act of 26 June 1992 No. 86 (in Norwegian: "tvangsfullbyrdelsesloven") as amended from time to time.
		

		
			"Enforcement Event" means, at any time after an Event of Default having occurred which is continuing, subject to and in accordance with the Indenture.
		

		
			 
		

		
			"FA Act" means the Norwegian Financial Contracts Act of 25 June 1999 No. 46 (in Norwegian: "finansavtaleloven") as amended from time to time.
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-4

		

 

		

			 

		

		

		
			"Financial Collateral Act" means the Norwegian Financial Collateral Act of 26 March 2004 No. 17 (in Norwegian: "lov om finansiell sikkerhetsstillelse") as amended from time to time.
		

		
			 
		

		
			"Liens Act" means the Norwegian Liens Act of 8 February 1980 No. 2 (in Norwegian: "panteloven") as amended from time to time.
		

		
			 
		

		
			"Related Rights" means all related rights which may be subject to a pledge pursuant to section 1-6 of the Liens Act, including dividends and other distributions payable (whether in cash or in kind).
		

		
			"Secured Creditors" means the Holders of the Securities, the Trustee and the Collateral Agent, each in their respective capacities.
		

		
			"Secured Obligations" means any and all Notes Obligations, as such term is defined in the Indenture.
		

		
			"Shares"  means:
		

		
			(a)           share number 1 – 30 (both inclusive; representing all shares issued in the Company), each with a nominal value of NOK 1,000, and owned by the Pledgor at the date of this Agreement (the "Existing Shares"); and
		

		
			(b)           any other shares issued by the Company to the Pledgor from time to time (the "Additional Shares").
		

		
			“Transaction Party” means each Note Party, as such term is defined in the Indenture.
		

		
			2.            PLEDGE OF SHARES
		

		
			2.1          Pledge
		

		
			(a)           As continuing security for the payment, discharge and performance of the Secured Obligations, the Pledgor hereby irrevocably and unconditionally pledges and collaterally grants to the Collateral Agent (on behalf of the Secured Creditors) first ranking security over the Existing Shares together with all Related Rights on the Existing Shares.
		

		
			(b)           If the Pledgor acquires any Additional Shares in the Company, it shall promptly grant hereunder to the Collateral Agent (on behalf of the Secured Creditors) first ranking security over such Additional Shares together with all Related Rights on the Additional Shares, by executing a notice in the form set out in Schedule 1 A (Form of notice of share pledge).
		

		
			2.2          Perfection
		

		
			(a)           The Pledgor shall promptly upon execution of this Agreement give written notice of the security created under this Agreement to the Company in the form set out in Schedule 1 A (Form of notice of share pledge)  and ensure that the Company promptly acknowledges receipt of such notice substantially in the form set out in Schedule 1 B (Form of acknowledgement of notice of share pledge) together with a
		

		
			
		

		
			

		 

		

			Appendix E-1-5

		

 

		

			 

		

		

		
			signed copy of its shareholder register evidencing due registration of the security on first priority.
		

		
			(b)           For any Additional Shares to be pledged in accordance with paragraph (b) of Clause 2.1 (Pledge), the Pledgor shall ensure that the security created over such Additional Shares is perfected in accordance with the procedure set out in paragraph (a) above promptly upon acquiring any Additional Shares.
		

		
			(c)           The Pledgor shall within 7 Business Days from the execution of this Agreement:
		

		
			(a)           take any action required to support registration of the particulars of this Agreement with the Registrar of Companies in Cyprus pursuant to section 90 of the Cyprus Company Law, Chapter 113 and shall make a filing of this Agreement and the necessary forms to the Registrar of Companies for the registration of a charge and deliver to the Collateral Agent evidence that the filing has been made and relevant fees paid;
		

		
			(b)           make an entry of the particulars of this Agreement in its register of charges and mortgages and deliver to the Collateral Agent a certified true copy of the same evidencing that this has been done.
		

		
			(d)           The Pledgor shall immediately upon receipt of the same deliver to the Collateral Agent a certificate of charge evidencing that the Registrar of Companies has registered a charge in favour of the Collateral Agent in relation to this Agreement.
		

		
			3.            LIMITATION
		

		
			3.1          Secured amount
		

		
			The amount secured under this Agreement is limited to a maximum principal amount equal to the lesser of (i) the Secured Obligations and (ii) USD 1,750,000,000 plus any unpaid amounts of interest and default interest under the Note Documents and enforcement costs.
		

		
			4.            REPRESENTATIONS AND WARRANTIES
		

		
			4.1          Representations and warranties
		

		
			The Pledgor represents and warrants to the Collateral Agent that:
		

		
			 
		

		
			(a)           it is the sole legal and beneficial owner of the Shares, subject to any Permitted Collateral Liens and Liens that will be terminated in connection with the application of the proceeds of the Securities;
		

		
			(b)           the Shares have been duly and validly issued and are fully paid and constitute the entire share capital of the Company;
		

		
			(c)           the articles of association of the Company do not restrict or inhibit any transfer of the Shares on creation or enforcement of the security created by this Agreement;
		

		
			(d)           the Shares are not subject to any option to purchase or similar rights and there are no agreements in force or financial instruments issued which provide for the issue or allotment of, or grant any person the right to call for the issue or allotment of, any share or loan capital of the Company (including any option or right of pre-emption or conversion); and
		

		
			
		

		
			

		 

		

			Appendix E-1-6

		

 

		

			 

		

		

		
			(e)           the Shares are not subject to any security or other encumbrance other than as created under this Agreement or by law or otherwise permitted under the Indenture.
		

		
			4.2          Repetition
		

		
			The representations set out in Clause 4.1 (Representations and warranties) are deemed to be made on the date of this Agreement and thereafter every time representations are made or are deemed to be repeated for all Note Documents pursuant to the terms of the Indenture.
		

		
			 
		

		
			5.            UNDERTAKINGS
		

		
			The Pledgor covenants with the Collateral Agent that, as from the date hereof and until this Agreement is terminated in accordance with Clause 12 (Release of Security), it shall:
		

		
			 
		

		
			(a)           promptly inform the Collateral Agent in writing of any Additional Shares to be issued by the Company, and promptly upon the issuance of such Additional Shares (to the extent not prohibited by law) ensure that a first ranking pledge in favour of the Collateral Agent is created over such Additional Shares in accordance with paragraph (b) of Clause 2.1 (Pledge) and that such pledge is perfected in accordance with paragraph (b) of Clause 2.2 (Perfection); and
		

		
			(b)           not do or cause or permit to be done anything which will, or could reasonably be expected to, materially adversely affect the rights of the Collateral Agent created hereunder, other than in accordance with or pursuant to any transaction not prohibited by the Indenture.
		

		
			 
		

		
			6.            CONTINUING SECURITY
		

		
			The security created under this Agreement is a continuing security extending to the ultimate balance of the Secured Obligations, and no part of such security will be considered satisfied or discharged notwithstanding (i) any intermediate payment, settlement or discharge of any part of the Obligations, or (ii) the enforcement of any other security granted for the Secured Obligations.
		

		
			 
		

		
			7.            DIVIDENDS AND VOTING RIGHTS
		

		
			7.1          Dividends
		

		
			(a)           Other than during the existence of an Enforcement Event for which the Pledgor has received written notice from the Collateral Agent of its intent to exercise remedies hereunder, the Pledgor is entitled to receive any dividends and other distributions payable on the Shares, subject to the terms of the Indenture.
		

		
			(b)           During the existence of an Enforcement Event, the Collateral Agent may by written notice to the Pledgor or the Company require that any dividends and other distributions payable on the Shares are paid to an account designated by the Collateral Agent.
		

		
			
		

		
			

		 

		

			Appendix E-1-7

		

 

		

			 

		

		

		
			7.2          Voting rights and power of attorney
		

		
			(a)           Other than during the existence of an Enforcement Event for which the Pledgor has received written notice from the Collateral Agent of its intent to exercise remedies hereunder, the Pledgor is permitted to retain and to exercise voting rights pertaining to the Shares.
		

		
			(b)           The Pledgor, to the extent permitted by law, irrevocably appoints the Collateral Agent as its attorney (with full power of substitution and delegation) in its name and on its behalf, during the existence of an Enforcement Event for which the Pledgor has received written notice from the Collateral Agent of its intent to exercise remedies hereunder, to:
		

		
			(i)            execute and deliver any document which is required, or deemed desirable, for the exercise of any rights conferred on the Collateral Agent under this Agreement or any applicable law; and
		

		
			(ii)           exercise any voting rights and any powers or rights which may be exercised by the legal or beneficial owner of the Shares, including to convene, attend and vote all shareholder meetings of the Company as the Pledgor's representative,
		

		
			and the Pledgor shall for this purpose on the date of this Agreement and at any later time immediately upon request by the Collateral Agent deliver to the Collateral Agent a power of attorney in the form set out in Schedule 2 (Power of attorney) or such other forms of authorisation required for the Collateral Agent to exercise any rights conferred on it pursuant to this paragraph (b).
		

		
			(c)           The power of attorney contained in this Clause 7 is granted solely to protect the Secured Creditors and will not impose any duty upon the Collateral Agent to exercise any such power of attorney.
		

		
			8.            ENFORCEMENT
		

		
			8.1          Enforcement
		

		
			(a)           For the purposes of the Financial Collateral Act this Agreement is an agreement on financial collateral (in Norwegian: avtale om finansiell sikkerhetsstillelse).
		

		
			(b)           During the existence of an Enforcement Event, the Collateral Agent may enforce all or any part of the security created under this Agreement as permitted by the Enforcement Act, the Liens Act, the Financial Collateral Act and any other applicable law or regulation and the Collateral Agent may (without further notice or demand):
		

		
			(i)            appropriate or sell (by private sale or public auction) any part of the Shares and the Related Rights; and
		

		
			(ii)           exercise any rights attaching to the Shares and the Related Rights, including any voting rights or the right to receive dividends in accordance with Clause 7 (Dividends and voting rights),
		

		
			
		

		
			

		 

		

			Appendix E-1-8

		

 

		

			 

		

		

		
			it being understood that the Collateral Agent may at any time instead elect to enforce the security created under this Agreement in accordance with the procedures set out in the Enforcement Act.
		

		
			 
		

		
			(c)           In case the ownership to all or any of the Shares is transferred to the Collateral Agent or to any of the Secured Creditors pursuant to paragraph (b)(i) above, the market value of the transferred Shares shall be set off against, or applied in or towards the discharge of, any part of the Secured Obligations in accordance with the provisions of the Indenture. The market value shall be determined as the average of the valuations of two well-renowned auditing, brokerage or valuation firms, which are independent from the Collateral Agent and the Secured Creditors, as appointed by the Collateral Agent (acting at the direction of the requisite Holders). The Collateral Agent shall upon completion of such valuation notify the Pledgor of the result of the valuation, and the valuation shall be binding on the Pledgor and the Transaction Parties (except in the event of manifest error).
		

		
			8.2          Costs and expenses
		

		
			Section 12.10 and 7.06 (Compensation and Indemnity) of the Indenture shall apply to this Agreement as if set out in its entirety herein.
		

		
			9.            APPLICATION OF PROCEEDS
		

		
			All amounts (or the value of any appropriated assets) from time to time received or recovered by the Collateral Agent in connection with the realisation or enforcement of all or any part of the Shares or otherwise pursuant to this Agreement shall be applied in or towards the discharge of any part of the Secured Obligations in accordance with the Indenture.
		

		
			10.          WAIVER OF DEFENCES
		

		
			10.1        The FA Act
		

		
			The Pledgor hereby agrees, accepts and acknowledges:
		

		
			 
		

		
			(a)           if and to the extent the FA Act is applicable to this Agreement, to waive all rights under the provisions of the FA Act not being mandatory provisions, including (but not limited to), the provisions of sections 62–74 (both sections inclusive) of the FA Act; and
		

		
			(b)           that it has received and noted the following information pursuant to the provisions of the FA Act section 61 (2):
		

		
			(i)            relevant information regarding all Note Documents established as security under the Indenture and that the security created under this Agreement is in addition to and is not in any way prejudiced by any present or future guarantee, collateral, lien or other security interest held by the Collateral Agent or any of the Secured Creditors; and
		

		
			(ii)           that no Event of Default has occurred as of the date hereof.
		

		
			10.2        Waivers
		

		
			The liability of the Pledgor to the Secured Creditors hereunder shall not be discharged, impaired or otherwise affected by reason of any of the following events or circumstances
		

		
			
		

		
			

		 

		

			Appendix E-1-9

		

 

		

			 

		

		

		
			(regardless of whether any such events or circumstances occur with or without notice to the Pledgor, or with or without its knowledge or consent):
		

		
			 
		

		
			(a)           any time, forbearance or other indulgence given or agreed between a Transaction Party and/or any third party, and the Secured Creditors, in respect of any of their respective obligations relating to the Indenture;
		

		
			(b)           any legal limitation, disability or incapacity of a Transaction Party, the Pledgor or any third party related to the Indenture or a Note Document thereunder;
		

		
			(c)           any invalidity, irregularity, unenforceability, imperfection or avoidance of or any defect in any security granted by, or the obligations of any party to the Indenture or a Note Document, or any amendment to or variation thereof, or of any other document or security comprised therein;
		

		
			(d)           the liquidation, bankruptcy, debt settlement proceedings or dissolution (or proceedings analogous thereto) or the appointment of a receiver for a Transaction Party, the Pledgor or any third party, or the occurrence of any circumstances whatsoever affecting the liability of any party to discharge its respective obligations under the Indenture or a Note Document;
		

		
			(e)           any challenge, dispute or avoidance by a liquidator of a Transaction Party, the Pledgor or any third party in respect of any claim by a Transaction Party by right of subrogation in any such liquidation;
		

		
			(f)            any release, discharge, renewal, amendment, extension, compromise exchange or realization of any security, obligation or term of a Note Document, or any further security for the obligations of a transaction under the Indenture;
		

		
			(g)           any failure on the part of a Secured Creditor (whether intentional or not) to take or perfect any security agreed to be taken under or in relation to a Note Document;
		

		
			(h)           any default or continuing default under a Note Document; or
		

		
			(i)            any other act, matter or thing which might otherwise constitute a legal discharge of the obligations of a Transaction Party, the Pledgor or any other person under a Note Document (other than the payment or performance of the Obligation).
		

		
			10.3        Reinstatement
		

		
			Any release, discharge or settlement between the Pledgor and a Secured Creditor in relation to this Agreement shall be conditional upon no right, security, disposition or payment to that Secured Creditor by a Transaction Party, the Pledgor or any other person being void, set aside or ordered to be refunded pursuant to any enactment or law relating to breach of duty by any person, bankruptcy, liquidation, administration, protection from creditors generally or insolvency or for any reason. If any such right, security, disposition or payment is void or at any time so set aside or ordered to be refunded, the Collateral Agent shall be entitled subsequently to enforce this Agreement against the Pledgor as if such release, discharge or settlement had not occurred and any such security, disposition or payment had not been made, and the Pledgor hereby undertakes to re-execute and execute any document reasonably required to give effect to this provision.
		

		
			
		

		
			

		 

		

			Appendix E-1-10

		

 

		

			 

		

		

		
			10.4        Order of realisation
		

		
			The Pledgor waives any right it may have of first requiring any Secured Creditor (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before claiming from the Pledgor under this Agreement. This waiver applies irrespective of any law or any provision of any Note Document to the contrary.
		

		
			 
		

		
			11.          DELEGATION
		

		
			The Collateral Agent may, at any time, delegate by power of attorney or otherwise to any person for any period, all or any right, power, authority or discretion vested in it in its capacity as such.
		

		
			 
		

		
			12.          RELEASE OF SECURITY
		

		
			(a)           This Share Pledge Agreement shall automatically terminate and be released upon (i) the occurrence of any of the events described in clauses (a) and (b) of Section 12.02 of the Indenture and the satisfaction of any conditions precedent set forth therein, (ii) consent of the requisite Holders in accordance with Section 10.02 and 12.02 of the Indenture, (iii) (x) the replacement of the Company as a “Collateral Rig Operator” in accordance with (a) a fundamental change of the Company not prohibited by Section 4.13 or Section 4.29 of the Indenture and/or (b) a transaction permitted by Section 4.27 and 4.29 of the Indenture, as applicable, and (y) to the extent required by the Indenture, the entry into a new Share Pledge Agreement by the Equity Pledgor as required by the Indenture or (iv) the occurrence of any events described in clause (e) of Section 12.02 of the Indenture.  A partial or intermediate payment or discharge of the Secured Obligations does not entitle the Pledgor to request a release (full or partial) of the pledge hereunder.
		

		
			(b)           Upon termination of the pledge hereunder pursuant to the terms hereof and of the Indenture (including, but not limited to, delivery of an Officer’s Certificate and Opinion of Counsel pursuant to Section 12.03), the Collateral Agent shall (i) release the pledge hereunder, and (ii) execute any documentation necessary or advisable to evidence the release, in each case, at the sole expense of the Pledgor.
		

		
			(c)           Notwithstanding paragraphs (a) and (b) above, if any payment hereunder is avoided or reduced or otherwise set aside by virtue of any bankruptcy, insolvency, liquidation or similar laws, the liability of the Pledgor under this Agreement and the security interest constituted by this Agreement shall continue and such amount shall not be considered to have been irrevocably paid.
		

		
			13.          ASSIGNMENT
		

		
			13.1        Pledgor
		

		
			The Pledgor may not assign or transfer any of its rights and/or obligations under this Agreement.
		

		
			
		

		
			

		 

		

			Appendix E-1-11

		

 

		

			 

		

		

		
			13.2        Secured Creditors
		

		
			A Secured Creditor may assign or transfer its rights hereunder in accordance with the terms of the Indenture together with a corresponding part of its rights and obligations under the other Note Documents.
		

		
			 
		

		
			14.          COUNTERPARTS
		

		
			This Agreement may be executed in any number of counterparts and this will have the same effect as if the signatures on the counterparts were on a single copy of this Agreement. Delivery of an executed signature page to this Agreement by facsimile or electronic transmission shall be effective as delivery of a manually signed counterpart of this Agreement.
		

		
			 
		

		
			15.          SEVERABILITY
		

		
			Any provision of this Agreement that is or becomes prohibited or unenforceable shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof.
		

		
			 
		

		
			16.          GOVERNING LAW AND JURISDICTION
		

		
			(a)           This Agreement and any non-contractual obligations arising out of or in connection with this Agreement are governed by Norwegian law.
		

		
			(b)           The parties hereto submit to the non-exclusive jurisdiction of the Norwegian courts, the venue to be the Oslo District Court (Oslo tingrett).
		

		
			(c)           Paragraph (b) above is for the benefit of the Secured Creditors. As a result, no Secured Creditor shall be prevented from taking proceedings in any other court with jurisdiction. To the extent permitted by law, the Secured Creditors may take concurrent proceedings in any number of jurisdictions.
		

		
			17.          COLLATERAL AGENT
		

		
			In acting hereunder, the Collateral Agent shall be entitled to (a) all of the rights, benefits, protections and indemnities provided to it in the Indenture, all of which are incorporated by reference herein in their entirety (b) receive an Officers’ Certificate and an Opinion of Counsel in accordance with Section 14.02 of the Indenture and (c) act with the consent of the requisite Holders as provided in the Indenture.
		

		
			 
		

		
			IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly executed by their authorised officers on the day and year first above written.
		

		
			 
		

		
			[Signature page to follow]
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-12

		

 

		

			 

		

		

		
			SCHEDULE 1 A
		

		
			FORM OF NOTICE OF SHARE PLEDGE
		

		
			To:        Songa Offshore SE
		

		
			Copy:    Wells Fargo Bank, National Association, as Collateral Agent
		

		
			Date:     [    ]
		

		
			Dear Sirs,
		

		
			NOTICE OF PLEDGE OF SHARES – SONGA OFFSHORE RIG 3 AS
		

		
			Please, take notice:
		

		
			1.             That by a "Security Agreement" dated 13 July 2018, [we have pledged]2 / [we have undertaken to pledge and do hereby irrevocably pledge]3 to Wells Fargo Bank, National Association, (the "Collateral Agent") as collateral agent for and on behalf of itself and certain secured parties, on first priority:
		

		
			(a)           all our shares in Songa Offshore Rig 3 AS, registration no. 913 292 073, (the "Company") from time to time (at the date hereof comprising [  ] shares numbered [  ]–[  ] (both inclusive; representing all shares issued the Company) (the "Shares"); and
		

		
			(b)           all related rights which may be subject to a pledge pursuant to section 1-6 of the 8 February 1980 No. 2 (in Norwegian: "panteloven") including cash dividends, dividend shares (in Norwegian: "fondsaksjer") and other distributions payable (whether in cash or in kind) on the Shares.
		

		
			2.             Upon instruction from the Collateral Agent, all rights attaching to the Shares will be exercisable by the Collateral Agent (or any person appointed in its place) and any dividends or other amounts thereafter being payable in respect of the Shares shall be paid to the Collateral Agent.
		

		
			3.             The authority and instructions herein contained cannot be revoked or varied by us without the written consent of the Collateral Agent.
		

		
			4.             Please acknowledge your receipt of this notice and your agreement thereto by returning the attached "Acknowledgement" directly to the Collateral Agent with a copy to us, in the form attached hereto, including a signed copy of the shareholder register of the Company where the pledge of the Shares is noted, including:
		

		

		
			2         To be used for Existing Shares
		

		
			3         To be used for Additional Shares
		

		
			
		

		
			

		 

		

			Appendix E-1-13

		

 

		

			 

		

		

		
			(a)           the date of entry; and
		

		
			(b)           that the Shares have been pledged on first priority in favour of Wells Fargo Bank, National Association, 1445 Ross Avenue, Suite 4300, Dallas, Texas, 75202, as collateral agent for and on behalf of itself and certain other secured parties.
		

		
			For and on behalf of
		

		
			Songa Offshore SE
		

			
					
						By:

					
					
						 

					
					
						    

					
					
						 

				
	
					
						Name:

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-14

		

 

		

			 

		

		

		
			SCHEDULE 1 B
FORM OF ACKNOWLEDGEMENT OF NOTICE OF SHARE PLEDGE
		

		
			To:        Wells Fargo Bank, National Association, as Collateral Agent
		

		
			 
		

		
			Copy:    Songa Offshore SE
		

		
			 
		

		
			Date:     [   ]
		

		
			 
		

		
			Dear Sirs,
		

		
			 
		

		
			ACKNOWLEDGEMENT OF NOTICE OF PLEDGE OF SHARES
		

		
			 
		

		
			We hereby acknowledge receipt of a notice of pledge of shares in Songa Offshore Rig 3 AS dated [   ] from Songa Offshore SE (the "Notice"). Capitalised words and expressions defined in the Notice have the same meaning when used herein.
		

		
			 
		

		
			We agree to the terms of the Notice and hereby confirm that:
		

		
			 
		

		
			(i)            we have registered the pledge over the Shares in our shareholder register on first priority in favour of the Collateral Agent;
		

		
			(ii)           we will register the pledge over any dividend shares (in Norwegian: "fondsaksjer") which may be issued in the Company to the Pledgor;
		

		
			(iii)          we are not aware of any security over the Shares other than the security created by the Share Pledge Agreement and any Permitted Collateral Lien or any option to purchase or similar rights or of any agreements in force or financial instruments issued which provide for the issue or allotment of, or grant any person the right to call for the issue or allotment of, any share or loan capital of the Company (including any option or right of pre-emption or conversion); and
		

		
			(iv)          we agree to act in accordance with the instruction set out in the Notice and we will do all such acts reasonably required to accomplish the transactions contemplated by the Share Pledge Agreement.
		

		
			Please find enclosed copy of our shareholder register which we confirm is true and correct as of the date of this acknowledgement.
		

		
			 
		

		
			For and on behalf of
		

		
			 
		

		
			Songa Offshore Rig 3 AS
		

		
			 
		

			
					
						By:

					
					
						 

					
					
						    

					
					
						 

				
	
					
						Name:

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-15

		

 

		

			 

		

		

		
			SCHEDULE 2 
		

		
			FORM OF POWER OF ATTORNEY
		

		
			POWER OF ATTORNEY
		

		
			 
		

		
			We hereby irrevocably empower Wells Fargo Bank, National Association, as Collateral Agent, or any person appointed by it to convene and attend all shareholder meetings of Songa Offshore Rig 3 AS (registration no. 913 292 073) (the "Company") as our representative and exercise all voting rights relating to our [   ] shares, numbered [   ]–[   ] (both inclusive) held in the Company, and we are excluded from exercising our voting rights in any shareholder meeting of the Company.
		

		
			 
		

		
			This power of attorney is governed by Norwegian law. Any conflicts arising hereunder shall be submitted to the Norwegian courts.
		

		
			 
		

		
			This Power of Attorney shall only be exercised in accordance with the “Security Agreement" dated 13 July 2018 executed by Songa Offshore SE.
		

		
			 
		

		
			[place/date]
		

		
			 
		

		
			SONGA OFFSHORE SE
		

		
			 
		

			
					
						By:

					
					
						 

					
					
						    

					
					
						 

				
	
					
						Name:

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix E-1-16

		

 

		

			 

		

		

		
			SIGNATURE PAGE
		

		
			 
		

		
			For and on behalf of
		

		
			 
		

		
			SONGA OFFSHORE SE
		

		
			(as Pledgor)
		

		
			 
		

			
					
						By:

					
					
						 

					
					
						    

					
					
						 

				
	
					
						Name:

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						 

					
					
						 

				

		
			 
		

		
			For and on behalf of
		

		
			 
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION
		

		
			(as pledgee and Collateral Agent)
		

		
			 
		

			
					
						By:

					
					
						 

					
					
						    

					
					
						 

				
	
					
						Name:

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						 

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix E-1-17

		

 

		

			 

		

		

		
			APPENDIX E-2
		

		
			FORM OF CAYMAN SHARE PLEDGE AGREEMENT
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix E-2-1

		

 

		

			 

		

		

		
			Dated July 13, 2018
		

		
			Transocean Guardian Limited
		

		
			and
		

		
			Wells Fargo Bank, National Association,
as Collateral Agent
		

		
			FORM OF
CHARGE OVER SHARES
IN
[TRANSOCEAN ENABLER LIMITED / TRANSOCEAN
ENCOURAGE LIMITED]
		

		
			 
		

		
			Note: Cayman Islands stamp duty will be payable if this document is executed in, brought to or produced before a court of the Cayman Islands
		

		
			 
		

		
			
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			CONTENTS
		

			
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						1

					
					
						    

					
					
						Definitions and interpretation

					
					
						    

					
					
						5 

				
	
					
						2

					
					
						 

					
					
						Charge

					
					
						 

					
					
						8 

				
	
					
						3

					
					
						 

					
					
						Delivery of documents

					
					
						 

					
					
						9 

				
	
					
						4

					
					
						 

					
					
						Covenants by the Chargor

					
					
						 

					
					
						10 

				
	
					
						5

					
					
						 

					
					
						Representations and warranties

					
					
						 

					
					
						11 

				
	
					
						6

					
					
						 

					
					
						Rights in respect of charged property

					
					
						 

					
					
						13 

				
	
					
						7

					
					
						 

					
					
						Enforcement

					
					
						 

					
					
						14 

				
	
					
						8

					
					
						 

					
					
						Receiver

					
					
						 

					
					
						17 

				
	
					
						9

					
					
						 

					
					
						Further assurance and power of attorney

					
					
						 

					
					
						18 

				
	
					
						10

					
					
						 

					
					
						Application of monies

					
					
						 

					
					
						19 

				
	
					
						11

					
					
						 

					
					
						Protection of purchasers

					
					
						 

					
					
						20 

				
	
					
						12

					
					
						 

					
					
						Preservation of security

					
					
						 

					
					
						20 

				
	
					
						13

					
					
						 

					
					
						Collateral Agent

					
					
						 

					
					
						22 

				
	
					
						14

					
					
						 

					
					
						Fees, costs and expenses

					
					
						 

					
					
						22 

				
	
					
						15

					
					
						 

					
					
						Indemnity

					
					
						 

					
					
						22 

				
	
					
						16

					
					
						 

					
					
						Ruling Off Account

					
					
						 

					
					
						22 

				
	
					
						17

					
					
						 

					
					
						Continuing Security and Non-Merger

					
					
						 

					
					
						23 

				
	
					
						18

					
					
						 

					
					
						Release

					
					
						 

					
					
						23 

				
	
					
						19

					
					
						 

					
					
						Illegality

					
					
						 

					
					
						23 

				
	
					
						20

					
					
						 

					
					
						Certificate of Collateral Agent

					
					
						 

					
					
						23 

				
	
					
						21

					
					
						 

					
					
						Amalgamation and consolidation

					
					
						 

					
					
						24 

				
	
					
						22

					
					
						 

					
					
						Conversion of currency

					
					
						 

					
					
						24 

				
	
					
						23

					
					
						 

					
					
						Amendment and waiver

					
					
						 

					
					
						24 

				
	
					
						24

					
					
						 

					
					
						Assignment

					
					
						 

					
					
						24 

				
	
					
						25

					
					
						 

					
					
						Entire agreement

					
					
						 

					
					
						24 

				
	
					
						26

					
					
						 

					
					
						Notices

					
					
						 

					
					
						24 

				
	
					
						27

					
					
						 

					
					
						Miscellaneous

					
					
						 

					
					
						25 

				
	
					
						28

					
					
						 

					
					
						Counterparts

					
					
						 

					
					
						26 

				
	
					
						29

					
					
						 

					
					
						Law and jurisdiction

					
					
						 

					
					
						26 

				

		
			 
		

		
			
		

		

		 

		

			 

		

 

		

			 

		

	
					
						

					
						Schedule 1

					
					
						    

					
					
						Initial Shares

				
	
					
						Schedule 2

					
					
						 

					
					
						Share Transfer

				
	
					
						Schedule 3

					
					
						 

					
					
						Letter of Resignation 

				
	
					
						Schedule 4

					
					
						 

					
					
						 

				
	
					
						Part 1

					
					
						 

					
					
						Notice of Charge

				
	
					
						Part 2

					
					
						 

					
					
						Acknowledgement

				
	
					
						Schedule 5

					
					
						 

					
					
						Irrevocable Proxy

				
	
					
						Schedule 6

					
					
						 

					
					
						Form of Letter of Instructions 

				
	
					
						Schedule 7

					
					
						 

					
					
						Shareholder Resolutions

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			This Charge is made on July 13, 2018
		

		
			BETWEEN:
		

		
			1            Transocean Guardian Limited, an exempted company incorporated in Cayman Islands, with registered number 338041, the registered office of which is at Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands (Chargor); and
		

		
			2            Wells Fargo Bank, National Association as Collateral Agent for the Secured Creditors (Collateral Agent), which expression shall include its successors, assigns and transferees.
		

		
			RECITALS:
		

		
			A           Pursuant to the Indenture, dated as of the date hereof (as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, the Indenture), by and among the Chargor, the Guarantors (as defined therein) party thereto from time to time and Wells Fargo Bank, National Association, as trustee  and Collateral Agent, the Issuer will issue 5.875% Senior Secured Notes due 2024 in an aggregate principal amount of $750,000,000.
		

		
			B           The Chargor is the registered holder of the Initial Shares.
		

		
			C           It is a requirement of the Indenture that the Chargor enter into this Agreement in order to grant to the Collateral Agent, for the ratable benefit of the Secured Creditors, a security interest in the Charged Property (as hereinafter defined).
		

		
			D           It is intended that this Charge takes effect as a deed notwithstanding that any party may only execute this Charge under hand.
		

		
			It is agreed as follows:
		

		
			1           Definitions and interpretation
		

		
			1.1        In this Charge, words and expressions shall, except where the context otherwise requires, have the meanings given to them in the Indenture, provided that, in the event of any conflict between the meaning of any term as defined in the Indenture and any term as defined in this Indenture, the definitions in the Indenture shall prevail.
		

		
			1.2        In this Charge, the following words and expressions shall, except where the context otherwise requires, have the following meanings:
		

		
			Authorised Officer means any officer duly and effectively designated in writing by any party hereto or to any other Note Document as having been authorised by such party to execute and deliver this
		

		
			
		

		
			

		 

		

			5

		

 

		

			 

		

		

		
			Charge or any other notice, agreement, document, certificate or instrument contemplated under this Charge;
		

		
			Charge means this share charge;
		

		
			Charged Property means the property and rights of the Chargor which are the subject of any security created or purported to be created by clause 2 of this Charge;
		

		
			Charged Shares means the Initial Shares and all and any other stocks, shares, warrants and other securities of any kind (including loan capital) of the Companies now or at any time in the future held by or beneficially owned by the Chargor or in which the Chargor has any interest (including any equity of redemption);
		

		
			Company means [Transocean Enabler Limited/Transocean Encourage Limited], a Cayman Islands exempted company.
		

		
			Derivative Assets means all certificates or other evidence of title to any of the Charged Shares now and from time to time hereafter deposited with the Collateral Agent and all rights, benefits and advantages including:
		

		
			(a)         all dividends or other distributions (whether in cash, securities or other property), interest and other income paid or payable in relation to any Charged Shares; and
		

		
			(b)         all shares, securities, rights, monies or other property whether certificated or uncertificated, accruing or issued at any time by way of redemption, conversion, exchange, substitution, preference, option, bonus issue or otherwise in respect of any Charged Shares (including but not limited to proceeds of sale);
		

		
			attributable to any of the Charged Shares or any Derivative Assets previously described.
		

		
			 
		

		
			Event of Default has the meaning given to such term under the Indenture;
		

		
			 
		

		
			Gross Negligence means a standard of misconduct beyond negligence whereby a person acts with reckless disregard for the consequences of his action or inaction;
		

		
			Initial Shares means the securities listed in Schedule 1 all of which are registered in the name of the Chargor;
		

		
			Legal Reservations means:
		

		
			 
		

		
			(a)         the principle that remedies may be granted or refused at the discretion of a court and the limitation of enforcement by laws relating to bankruptcy, insolvency, reorganisation and other laws generally affecting the rights of creditors;
		

		
			(b)         the time barring of claims and defences of set-off or counterclaim; and
		

		
			(c)         similar principles, rights and defences under the laws of any applicable jurisdiction;
		

		
			
		

		
			

		 

		

			6

		

 

		

			 

		

		

		
			Receiver has the meaning given to it in clause 8;
		

		
			Secured Creditors has the meaning given to it in the Indenture.
		

		
			Secured Obligations means the “Notes Obligations” as such term is defined in the Indenture.
		

		
			Security Interest means any “Lien” as such term is defined in the Indenture; and
		

		
			Security Period means the period commencing on the date hereof and ending on the date upon which this Charge is terminated pursuant to clause 16.
		

		
			1.3        In the interpretation of this Charge, the following provisions apply save where the context requires otherwise:
		

		
			(a)         references to any person, including, but not limited to, the Collateral Agent, the Chargor and the Company shall include its successors, assignees and transferees and, in the case of the Collateral Agent, any person from time to time appointed as Collateral Agent or Collateral Agents in accordance with the Note Documents;
		

		
			(b)         where references are made to the Collateral Agent holding title to or having possession or control of the Charged Property or any part thereof, such references shall include any person holding title to or having possession or control of the Charged Property or any part thereof for or on behalf of the Collateral Agent, whether as trustee or in some other capacity;
		

		
			(c)         assets includes present and future properties, revenues and rights of every description;
		

		
			(d)         any reference to this Charge or to any agreement or document referred to in this Charge shall be construed as a reference to such agreement or document as amended, varied, modified, supplemented, restated, novated or replaced from time to time;
		

		
			(e)         except where the context otherwise requires, words denoting the singular include the plural and vice versa, words denoting a gender include every gender and references to persons include bodies corporate and unincorporate;
		

		
			(f)         indebtedness due, owing or incurred under the Note Documents shall include all moneys, obligations and liabilities due, owing or incurred in respect of any variations or increases in the amount or composition of the facilities provided for therein or the obligations and liabilities imposed thereunder however fundamental;
		

		
			(g)         references to constitutional documents of an entity shall include, without limitation, the certificate(s) of incorporation or establishment, the memorandum and articles of association and, where the entity is the trustee of a trust, the trust instrument constituting the relevant trust;
		

		
			
		

		
			

		 

		

			7

		

 

		

			 

		

		

		
			(h)         any reference to a regulation includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation;
		

		
			(i)          an Event of Default is continuing if it has not been remedied or waived;
		

		
			(j)          the word may shall be construed as permissive and the word shall shall be construed as imperative;
		

		
			(k)         any phrase introduced by the terms including,  include,  in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms;
		

		
			(l)          clause headings and the index are inserted for convenience only and shall not affect the construction of this Charge;
		

		
			(m)        references to statutes are, unless otherwise specified, references to statutes of the Cayman Islands (and such reference shall be taken to be to the short title applicable to such statute) and include any statutory amendment, modification, consolidation or re-enactment thereof for the time being in force; and
		

		
			(n)         references to recitals, clauses and Schedules are, unless the context otherwise requires, references to recitals and clauses hereof and Schedules hereto and references to sub-clauses are, unless otherwise stated, references to the sub-clause of the clause in which the reference appears; and
		

		
			(o)         the recitals and the Schedules form part of this Charge and shall have the same force and effect as if they were expressly set out in the body of this Charge and any reference to this Charge shall include the recitals and the Schedules.
		

		
			1.4        This Charge is a Note Document as defined in the Indenture.
		

		
			2           Charge
		

		
			2.1        The Chargor as sole legal and beneficial owner of the Charged Shares hereby charges by way of fixed charge as continuing security for the full and punctual payment and discharge of the Secured Obligations, all its right, title, interest and benefit present and future in, to and under the Charged Shares and the Derivative Assets (with the intent that the security so constituted shall extend to all beneficial interests of the Chargor in the Charged Property and any proceeds of sale or other realisation of the Charged Property or any part of it) and to the extent not effectively charged under this clause 2.1, collaterally assigns, and agrees to collaterally assign, absolutely by way of security to the Collateral Agent all its rights, present and future, actual or contingent, relating to any of the Charged Property.
		

		
			
		

		
			

		 

		

			8

		

 

		

			 

		

		

		
			2.2        This Charge shall be released in accordance with clause 16 at the sole cost of the Chargor.
		

		
			3           Delivery of documents
		

		
			3.1        The Chargor shall deliver, or cause to be delivered, to the Collateral Agent on the date hereof:
		

		
			(a)         all original share certificates (if any) representing the Initial Shares (or written confirmation from the Company that it has not issued any share certificate) and a certified copy of the register of members of the Company showing the Chargor as the registered owner of the Initial Shares;
		

		
			(b)         an executed but undated share transfer form in respect of the Initial Shares in the form set out in Schedule 2 to this Charge and any other documents which on the date hereof enable the Collateral Agent or its nominee or nominees to be registered as the owner or otherwise obtain legal title to the Initial Shares;
		

		
			(c)         an executed and undated letter of resignation and related letter of authorisation from each director or alternate director of the Company in the form set out in Schedule 3;
		

		
			(d)         an executed and dated notice of charge from the Chargor to the Company in the form set out in Part I of 4 to this Charge, together with an executed and dated letter of confirmation from the Company evidencing its receipt of such notice and acknowledgement of the terms thereof in the form set out in Part II of Schedule 4 to this Charge;
		

		
			(e)         an executed and dated irrevocable proxy made in respect of the Initial Shares in favour of the Collateral Agent in the form set out in Schedule 5 to this Charge;
		

		
			(f)         an executed letter of instruction from the Company to its registered office service provider / administrator in the form set out in Schedule 6; and
		

		
			(g)         a copy of the special resolution passed by the Company amending the Company’s articles of association in the manner set out in Schedule 7 to this Charge.
		

		
			3.2        To the extent not delivered pursuant to clause 3.1, the Chargor shall, for as long as any Secured Obligations remain outstanding, promptly and from time to time deposit with the Collateral Agent:
		

		
			(a)         executed but undated share transfer forms in respect of all Charged Shares other than the Initial Shares in the form set out in Schedule 2 to this Charge as and when any further shares in the Company are acquired by, or issued to, the Chargor;
		

		
			(b)        all original share certificates (if any) and any other documents of title relating to the Charged Shares (which, for the avoidance of doubt, includes all share certificates and other documents of title relating to any shares in the Company acquired by, or issued to, the Chargor after the
		

		
			
		

		
			

		 

		

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			date of this Charge) or confirmation from the Company that it has not issued any such certificates;
		

		
			(c)         an executed and undated letter of resignation from each newly appointed director or alternate director of the Company in the form set out in Schedule 3.
		

		
			(d)        an executed and dated notice of charge from the Chargor to the Company in the form set out in Part I of Schedule 4 to this Charge in respect of any shares in the Company acquired by, or issued to, the Chargor after the date of this Charge, together with an executed and dated letter of confirmation from the Company evidencing its receipt of such notice and acknowledgement of the terms thereof in the form set out in Part II of Schedule 4 to this Charge;
		

		
			(e)         an executed and dated irrevocable proxy made respect of any shares in the Company acquired by or issued to the Chargor after the date of this Charge; in favour of the Collateral Agent in the form set out in Schedule 5 to this Charge; and
		

		
			(f)         a certified copy of the register of members of the Company showing the Chargor as the registered owner of any shares in the Company acquired by or issued to the Chargor after the date of this Charge.
		

		
			3.3        The Chargor shall, within five Business Days of the date of this Charge, provide the Collateral Agent with a certified copy of the register of mortgages and charges of the Chargor updated to include the particulars of this Charge.
		

		
			4           Covenants by the Chargor
		

		
			4.1        Unless otherwise not prohibited by the Indenture, the Chargor covenants and undertakes that, until the end of the Security Period, it shall:
		

		
			(a)        promptly pay all calls, instalments and other payments which may be made or become due in respect of the Charged Property and in the event that the Chargor fails to make such payments, the Collateral Agent may, but shall not be obliged to, make such payments on behalf of the Chargor, in which event any sums so paid shall be secured hereby, and shall be reimbursed by the Chargor on demand;
		

		
			(b)        at any time following the occurrence and during the continuance of an Event of Default, it shall exercise all voting and other rights and powers which may at any time be exercisable by the holder of the Charged Property as the Collateral Agent may in its absolute discretion direct in writing, but absent such direction, may continue to exercise such rights and powers in its absolute discretion;
		

		
			
		

		
			

		 

		

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			(c)         do everything in its commercially reasonable power to prevent any person other than the Collateral Agent from becoming entitled to claim any right over the Charged Property or any part thereof; and
		

		
			(d)         if the Chargor proposes to change its name, the Chargor shall give to the Collateral Agent:
		

		
			(i)         notice in writing that it proposes to change its name (along with the correct spelling of its proposed new name) at least ten Business Days (or such shorter period of time as the Collateral Agent may permit) before the change takes effect; and
		

		
			(ii)        a certified copy of the constitutional documents stating the Chargor’s new name as soon as practicable after they are issued.
		

		
			4.2        The covenants and undertakings given in clause 4 are continuing covenants and undertakings throughout the Security Period.
		

		
			5           Representations and warranties
		

		
			5.1        The Chargor hereby represents and warrants to the Collateral Agent that, other than as not prohibited by the Indenture:
		

		
			(a)         each of the Chargor and the Companies is a body corporate duly incorporated and validly existing under the laws of the jurisdiction of its incorporation and all corporate and other action required to authorise the execution and delivery of this Charge and the creation and perfection of the security intended to be created pursuant to clause 2 has been duly taken;
		

		
			(b)         subject to the Legal Reservations, this Charge constitutes the legal, valid and binding obligations of the Chargor, enforceable against the Chargor in accordance with its terms;
		

		
			(c)         the entry into this Charge by the Chargor and the performance by it of its obligations thereunder will not conflict with:
		

		
			(i)          any law or regulation applicable to it or to any Company; or
		

		
			(ii)        its or any Company's constitutional documents; or
		

		
			(iii)       any material agreement or material instrument entered into or binding upon the Chargor or any of its assets or any Company;
		

		
			(d)        the Chargor has obtained all governmental and other consents, authorisations or permissions necessary for it:
		

		
			(i)          to enter into this Charge and perform its obligations hereunder; and
		

		
			
		

		
			

		 

		

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			(ii)        to enable it to create the security interests pursuant to this Charge and to ensure that such security interests have the priority and ranking that they are expressed to have;
		

		
			(e)         the Chargor is not insolvent or bankrupt under the laws of any jurisdiction and has not, in any jurisdiction, commenced or, as far as it is aware, had commenced against it any proceedings or other actions for or indicative of insolvency or bankruptcy;
		

		
			(f)         no corporate action, legal proceedings or other procedure or step has been taken in relation to:
		

		
			(i)          the suspension of payments, a moratorium of any indebtedness, winding-up (whether voluntary or by the courts of the Cayman Islands), liquidation, dissolution, strike off, administration or reorganisation (by way of voluntary arrangement, creditors' arrangement, scheme of arrangement or otherwise) of the Chargor or any Company;
		

		
			(ii)        a composition, compromise, assignment or arrangement with any creditor of the Chargor or any Company;
		

		
			(iii)       the appointment of a liquidator, provisional liquidator, receiver, administrative receiver, administrator, compulsory manager or other similar officer in respect of the Chargor or any Company or any of its assets or revenues; or
		

		
			(iv)        enforcement of any Security Interests over any assets of the Chargor or any Company,
		

		
			and no analogous procedure or step has been taken in any jurisdiction in respect of the Chargor or any Company.
		

		
			(g)        this Charge creates a first priority security interest in the Charged Property under the laws of the Cayman Islands in favour of the Collateral Agent (subject to Permitted Collateral Liens), which is perfected under the laws of the Cayman Islands, subject to the Legal Reservations;
		

		
			(h)        the Chargor is the sole legal and beneficial owner of and has good title to and rights in the Initial Shares free of all Security Interests (subject only to the rights granted in favour of the Collateral Agent by this Charge and Permitted Collateral Liens) and all of the Initial Shares are validly issued and fully paid up;
		

		
			(i)         the Initial Shares have been validly issued, are fully paid and constitute the entire issued share capital of the Company and, other than Permitted Collateral Liens, no other person has or is entitled to any conditional or unconditional option, warrant or other right to subscribe for, purchase or otherwise acquire or become registered holder of any issued or unissued shares in the share capital of any Company, or any such interest in those shares or in the share capital of any Company; and
		

		
			
		

		
			

		 

		

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			(j)         other than Permitted Collateral Liens, the Charged Property is not subject to any options, warrants, pre-emption or similar rights and free from all Security Interests and rights of set-off other than those created under this Charge in favour of the Collateral Agent.
		

		
			The Chargor acknowledges and agrees that the Collateral Agent holds the benefit of this Charge on behalf of the Secured Creditors and that the Secured Creditors have relied on these representations in connection with entry into the Note Documents.
		

		
			6           Rights in respect of charged property
		

		
			Voting and other rights
		

		
			6.1        Notwithstanding the provisions of clause 2, other than during the existence of an Event of Default a described in Section 6.2, the Chargor (or its agent) is hereby authorised to exercise any voting rights in respect of the Charged Property.
		

		
			6.2        At any time during the existence of an Event of Default:
		

		
			(a)         the Collateral Agent shall be solely and exclusively entitled to exercise all voting rights and other rights attaching to the Charged Property or any part thereof and shall be entitled to exercise such rights in such manner as the Collateral Agent (acting at the direction of the requisite Holders) may in its absolute discretion determine;
		

		
			(b)        the Chargor shall not be authorised to, and shall not, give instructions or exercise any rights in respect of the Charged Property however, in the absence of exercise (or notice of intent to exercise from the Collateral Agent) of such rights by the Collateral Agent (acting at the direction of the requisite Holders), the Chargor may only take such actions with the object of enhancing or preserving the Charged Property and its value;
		

		
			(c)        where the assignment or transfer of the Charged Property has not been effected, the Chargor shall forthwith exercise all voting or other rights in respect thereof in such manner as the Collateral Agent (acting at the direction of the requisite Holders) shall direct from time to time and, in the absence of such directions, only with the object of enhancing or preserving the Charged Property and its value.
		

		
			6.3        The Collateral Agent may (but shall not be obligated to), in such manner as it shall determine (acting at the direction of the requisite Holders), exercise, or cause to be exercised, or refrain from exercising, any voting or other rights which it may have pursuant to this clause 6 and it shall not be liable for any such exercise or failure to exercise such rights.
		

		
			
		

		
			

		 

		

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			Dividends
		

		
			6.4        Unless there is an existing Event of Default for which the Collateral Agent has provided written notice to the Chargor of its intent to exercise remedies hereunder:
		

		
			(a)         all dividends or other income or distributions arising in respect of the Charged Property (in this clause, dividends) shall be receivable by the Chargor, which may retain such dividends for its own benefit, and such dividends shall be released from the security created hereunder; and
		

		
			(b)         the Collateral Agent shall, to the extent that dividends are received by it, account to the Chargor for such dividends after deducting its costs and expenses for doing so.
		

		
			6.5        During the existence of an Event of Default:
		

		
			(a)         all dividends shall be receivable by the Collateral Agent, which shall administer such dividends in accordance with the Indenture; and
		

		
			(b)         the Chargor shall, to the extent that dividends are received by it, account to the Collateral Agent for such dividends and, pending delivery, shall hold such dividends on trust for the Collateral Agent.
		

		
			6.6        The provisions of clause 6.5 are without prejudice to the right of the Collateral Agent to credit monies received, recovered or realised to a separate suspense account pursuant to clause 16 of this Charge.
		

		
			General
		

		
			6.7        The Collateral Agent shall not have any duty to ensure that any dividends, interest or other moneys and assets receivable in respect of the Charged Property are duly and punctually paid, received or collected as and when the same become due and payable or to ensure that the correct amounts (if any) are paid or received on or in respect of the Charged Property.
		

		
			7           Enforcement
		

		
			7.1        The security created by this Charge shall become immediately enforceable if an Event of Default occurs and is continuing.
		

		
			7.2        The Chargor shall forthwith following the occurrence of an Event of Default which is continuing sign, seal, execute, deliver and complete all transfers, renunciations, proxies, mandates, assignments, deeds and documents and do all acts and things which the Collateral Agent may require (acting at the direction of the requisite Holders), at any time and from time to time specify for enabling or assisting the Collateral Agent:
		

		
			(a)         to perfect or improve its title to and security over the Charged Property;
		

		
			
		

		
			

		 

		

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			(b)         to vest the Charged Property in the Collateral Agent or its nominee or nominees;
		

		
			(c)         to procure that the Collateral Agent or its nominee or nominees is registered in the register of members of the Company in respect of the Charged Shares;
		

		
			(d)         to exercise (or enable its nominee or nominees to exercise) any rights or powers attaching to the Charged Property;
		

		
			(e)         to sell or dispose of the Charged Property; and/or
		

		
			(f)         otherwise to enforce any of the rights of the Collateral Agent under or in connection with this Charge.
		

		
			7.3        During the existence of an Event of Default and in accordance with the other provisions of this Charge, the Collateral Agent may, without notice to or further consent or concurrence by, the Chargor and without prior authorisation from any court, and at all times without prejudice to any other right or remedy available hereunder or under applicable law, in its absolute discretion:
		

		
			(a)         solely and exclusively to exercise all other rights and/or powers and/or discretions of the Chargor in, to and under the Charged Property pursuant to the memorandum and articles of association of the Companies;
		

		
			(b)         take possession of, collect and get in the Charged Property or any part thereof or otherwise exercise in relation to the Charged Property or any part thereof all of the rights of an absolute owner and, for that purpose, to take such proceedings as may seem to it to be expedient;
		

		
			(c)         sell, assign, exchange, transfer, grant options over or otherwise dispose of the Charged Property or any part thereof at such place and in such manner and upon such terms as the Collateral Agent may deem fit, with power to postpone any such sale or other disposition and in any such case the Collateral Agent may exercise any and all rights attaching to the Charged Property as the Collateral Agent in its absolute discretion may determine and without being answerable for any loss occasioned by such sale or resulting from postponement thereof or the exercise of such rights and thereupon the Collateral Agent shall have the right to deliver, assign and transfer in accordance therewith the Charged Property so sold, transferred, granted options over or otherwise disposed of including by way of changing the ownership of the Charged Shares as shown on the register of members of the Companies;
		

		
			(d)         date, deliver and present to the Companies or any other person, including the Companies’ registered office provider, any undated documents provided to it pursuant to clause 3 or any other provision of this Charge, including to remove the then existing directors (with or without cause) of the Companies, to appoint such persons as directors of the Companies as it shall deem appropriate and to take all steps to register and perfect the transfer of the Charged Shares to the
		

		
			
		

		
			

		 

		

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			Collateral Agent or its nominee or nominees, including by completing any undated blank share transfer forms by inserting in such share transfer forms the date and the name of the transferee;
		

		
			(e)         exercise all voting rights and/or consensual powers relating to the Charged Property or any part thereof and exercise such rights and powers in such manner as the Collateral Agent may think fit;
		

		
			(f)         receive and retain all dividends, distributions, interest or other moneys or assets accruing on or in respect of the Charged Property or any part thereof, such dividends, distributions interest or other moneys or assets to be held by the Collateral Agent, as additional security mortgaged and charged under and subject to the terms of this Charge and any such dividends, distributions, interest and other moneys or assets received by the Chargor after such time shall be held in trust by the Chargor for the Collateral Agent and be paid or transferred to the Collateral Agent on demand;
		

		
			(g)         settle, adjust, refer to arbitration, compromise and arrange any claims, accounts, disputes, questions and demands with or by any person who is or claims to be a creditor in respect of the Charged Property;
		

		
			(h)         bring, prosecute, enforce, defend and abandon actions, suits and proceedings in relation to the Charged Property;
		

		
			(i)          redeem any security (whether or not having priority to this Charge) over the Charged Property and to settle the accounts of any person with an interest in the Charged Property;
		

		
			(j)          exercise and do (or permit the Chargor or any nominee of the Chargor to exercise and do) all such rights and things as the Collateral Agent would be capable of exercising or doing if it were the absolute beneficial owner of the Charged Property;
		

		
			(k)         do anything else it may think fit for the realisation of the Charged Property;
		

		
			(l)          exercise all rights and remedies afforded to it under this Charge and applicable law;
		

		
			(m)        appoint attorneys or accountants or other professionally qualified person to assist it in the performance of its rights and remedies;
		

		
			(n)         bring or defend any action or other legal proceedings in the name of and on behalf of the Chargor in respect of the Charged Property;
		

		
			(o)         do all acts and execute in the name and on behalf of the Chargor any document or deed in respect of the Charged Property; and
		

		
			
		

		
			

		 

		

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			(p)         make any payment which is necessary or incidental to the performance of its functions under this Charge.
		

		
			7.4        Nothing done by or on behalf of the Collateral Agent pursuant to this Charge shall render it liable to account as a mortgagee in possession for any sums except in the case of actual fraud, Gross Negligence or wilful misconduct.
		

		
			7.5        The Collateral Agent may delegate in any manner to any person (including any Receiver) any rights or powers exercisable by the Collateral Agent under this Charge.
		

		
			7.6        Neither the Collateral Agent nor any of its agents, managers, officers, employees, directors, delegates or advisers shall be liable for any claim, demand, liability, loss, damage, cost or expense incurred or arising in connection with the exercise or purported exercise of any rights, powers and discretions hereunder in the absence of actual fraud, Gross Negligence, or wilful misconduct.
		

		
			7.7        The Chargor waives any right it may have to require the Collateral Agent to enforce any other security before enforcing the security created by this Charge or to first enforce any rights against or claim payment from any other person before claiming from the Chargor under this Charge.
		

		
			8           Receiver
		

		
			8.1        During the existence of an Event of Default, without notice to or further consent or concurrence by the Chargor appoint one or more person or persons as the Collateral Agent thinks fit to be a receiver (Receiver) in relation to the Charged Property.  Where the Collateral Agent appoints two or more persons as Receiver, the Receivers may act jointly or severally.
		

		
			8.2        Only to the extent the Collateral Agent is permitted to do so under this Charge, the Receiver may without notice to or further consent or concurrence by the Chargor or the Company, take such action in relation to the enforcement of this Charge including, without limitation, to sell, charge or otherwise dispose of the Charged Property, to exercise any powers, discretion, voting or other rights or entitlements in relation to the Charged Property and generally to carry out any other action which he may in his sole discretion deem necessary in relation to the enforcement of this Charge.
		

		
			8.3        The Collateral Agent may from time to time determine the remuneration of the Receiver.
		

		
			8.4        The Receiver shall have the powers of the Collateral Agent set out in this Charge and, without prejudice to the foregoing, shall have the following powers:
		

		
			(a)        power to take possession of, collect and get in any of the Charged Property and, for that purpose, to take such proceedings as may seem to him to be expedient;
		

		
			(b)        without notice to, or further consent or concurrence by, the Chargor to sell or otherwise dispose of any of the Charged Property by such method, at such place and upon such terms as a Receiver may in its absolute discretion determine, with power to postpone any
		

		
			
		

		
			

		 

		

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			such sale and in any such case a Receiver may exercise any and all rights attaching to the Charged Property as the Receiver in its absolute discretion may determine and without being answerable for any loss occasioned by such sale or resulting from postponement thereof or the exercise of such rights;
		

		
			(c)        power to raise or borrow money and grant security over any of the Charged Property;
		

		
			(d)        power to appoint attorneys or accountants or other professionally qualified persons to assist him in the performance of his functions;
		

		
			(e)        power to bring or defend any action or other legal proceedings in the name of and on behalf of the Chargor in respect of the Charged Property;
		

		
			(f)        power to do all acts and execute in the name and on behalf of the Chargor any document or deed in respect of the Charged Property;
		

		
			(g)        power to make any payment which is necessary or incidental to the performance of his functions;
		

		
			(h)        power to make any arrangement or compromise on behalf of the Chargor in respect of the Charged Property;
		

		
			(i)        power to rank and claim in the insolvency or liquidation of a Company and to receive dividends and to accede to trust deeds for the creditors of the Company;
		

		
			(j)        power to present or defend a petition for the winding up of a Company; and
		

		
			(k)       power to do all other things incidental to the exercise of the foregoing powers.
		

		
			 
		

		
			8.5        The Collateral Agent may remove a Receiver in respect of all or any of the Charged Property of which he is the Receiver and after the Receiver has vacated office or ceased to act in respect of any of the Charged Property, appoint a replacement Receiver over all or any of the Charged Property in respect of which the previous Receiver shall have ceased to act.
		

		
			9           Further assurance and power of attorney
		

		
			9.1        The Chargor shall, at any time and from time to time promptly do any and all such acts and things and execute and deliver all such instruments and any documents to the Collateral Agent (including, without limitation, any replacement or supplemental security agreements) as are necessary or desirable for creating, perfecting, protecting, maintaining or enforcing the Collateral Agent’s security or rights under this Charge or the laws of the Cayman Islands.
		

		
			9.2        The Chargor hereby irrevocably and by way of security for the payment of the Secured Obligations and the performance of its obligations under this Charge, appoints the Collateral Agent and each and every person to whom the Collateral Agent from time to time has delegated the exercise of the power of attorney conferred by this clause to be its true and lawful attorney or attorneys (with full power to appoint
		

		
			
		

		
			

		 

		

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			substitutes and to sub-delegate) on behalf of the Chargor and in the Chargor's own name or otherwise, at any time and from time to time, to sign, execute, seal, deliver, acknowledge, file, register and perfect any and all assurances, documents, instruments, agreements, certificates and consents whatsoever and to do any and all such acts and things in relation to any matters dealt with in this Charge and/or which the Collateral Agent may deem necessary or desirable for creating, perfecting, protecting, maintaining or enforcing the security contemplated hereunder, giving full effect to this Charge or for securing, protecting or exercising the rights of the Collateral Agent hereunder or under the Law, including without limitation:
		

		
			(a)         completing, dating, executing and/or delivering any share transfer forms and/or notices in respect of the Charged Property;
		

		
			(b)         exercising any voting or other rights in respect of the Charged Property to the extent permitted pursuant to the other provisions of this Charge; and
		

		
			(c)         taking any action which the Chargor is required to take pursuant to this Charge.
		

		
			9.3        The Chargor hereby covenants with the Collateral Agent to ratify and confirm any lawful exercise or purported exercise of the power of attorney referred to in this clause.
		

		
			9.4        All sums expended by the Collateral Agent under this clause shall be recoverable from the Chargor in accordance with the terms of this Charge.
		

		
			9.5        The power of attorney contained in this clause 9 shall only be exercisable by the Collateral Agent at any time that an Event of Default has occurred and is continuing.
		

		
			10         Application of monies
		

		
			10.1      The Collateral Agent (and any Receiver) shall apply the monies received by it as a result of the enforcement of the security created hereby in the manner prescribed by the Indenture.
		

		
			10.2      The Collateral Agent shall not be liable for any loss or damage occasioned by:
		

		
			(a)         any sale or disposal of the Charged Property or an interest in the Charged Property; or
		

		
			(b)         arising out of the exercise, or failure to exercise, any of its powers under this Charge; or
		

		
			(c)         any neglect or default to pay any instalment or accept any offer or notify the Chargor of any such neglect or default; or
		

		
			(d)         any other loss of whatever nature in connection with the Charged Property,
		

		
			other than, in each case, actual fraud, Gross Negligence or wilful misconduct.
		

		
			
		

		
			

		 

		

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			11         Protection of purchasers
		

		
			No purchaser or other person dealing with the Collateral Agent or its delegate shall be bound to see or inquire whether the right of the Collateral Agent to exercise any of its powers has arisen or become exercisable or be concerned with notice to the contrary, or be concerned to see whether the delegation by the Collateral Agent pursuant to the terms of this Charge shall have lapsed for any reason or been revoked.
		

		
			12         Preservation of security
		

		
			Continuing Security
		

		
			12.1      The security created pursuant to this Charge shall take effect as a continuing security for the payment or performance of all or any part of the Secured Obligations and shall be independent of and in addition to and it shall not be prejudiced or be affected by and shall not affect or prejudice any other security now or hereafter held by the Collateral Agent in respect of the payment or performance of all or any part of the Secured Obligations.
		

		
			12.2      The security, and the rights, obligations and liabilities, created pursuant to this Charge (including, without limitation, the rights, powers and remedies conferred upon the Collateral Agent shall not be in any way discharged, impaired or otherwise affected by:
		

		
			(a)        any partial or intermediate payment or performance of the Secured Obligations;
		

		
			(b)        any of the Secured Obligations or any other security taken in respect of the Secured Obligations being or becoming wholly or partially illegal, invalid, unenforceable or ineffective in any respect;
		

		
			(c)        any amendment to, or any variation, waiver or release of, any of the Secured Obligations or any other security taken in respect of the Secured Obligations or any amendment to, restatement of, or supplement to the Indenture or any other Note Document (including, without limitation, any amendment the effect of which is to change the nature or amount of any facilities made available thereunder or to change the nature or extent of any obligations thereunder);
		

		
			(d)        any variation, extension, discharge, compromise, dealing with, exchange or renewal of any right or remedy which Collateral Agent may now or hereafter have from or against any person in respect of any obligations of the Chargor under the Note Documents or any other document or any other person;
		

		
			(e)        any act or omission by the Collateral Agent in taking up, creating, attaching, perfecting or enforcing any security, indemnity or guarantee from or against the Chargor or any other person;
		

		
			
		

		
			

		 

		

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			(f)         any defect in, termination, amendment, variation, novation or supplement of or to any of the Note Documents or to any document pursuant to which obligations are due by the Chargor or any other person to the Collateral Agent;
		

		
			(g)         any grant of time, indulgence, waiver or concession given to the Chargor, any Note Party or any other person;
		

		
			(h)         any of the insolvency, bankruptcy, liquidation, administration, winding-up, incapacity, limitation, disability, the discharge by operation of law, and any change in the constitution, name and style of any party to any of the Note Documents or any other person;
		

		
			(i)          any release, invalidity, illegality, unenforceability, irregularity or frustration of any actual or purported obligation of the Chargor, any Note Party or any other person in respect of any of the Note Documents or any other document;
		

		
			(j)          any claim or enforcement of payment from any of the other parties to the Note Documents or any other person; or
		

		
			(k)         any act or omission which would have discharged or affected the liability of the Chargor or by anything done or omitted by any person which but for this provision might operate to exonerate or discharge the Chargor or otherwise reduce or extinguish its liability under this Charge or any of the rights, powers or remedies conferred upon the Collateral Agent by this Charge or by law (other than with respect to payment of the Secured Obligations),
		

		
			whether any such event or circumstance occurs with or without the Collateral Agent's knowledge or consent.
		

		
			12.3      The Collateral Agent is not obliged, before exercising any of the rights, powers or remedies it may have pursuant to this Charge or by law, to make any demand of, or take action or file any claim or proof in respect of, any person other than the Chargor or to enforce any other security in respect of the Note Documents.
		

		
			12.4      If the Charged Property or any part thereof is released from the security interest created hereunder in reliance upon a payment or other performance or discharge which is subsequently avoided or set aside for any reason whatsoever (including, without limitation, in connection with the insolvency or bankruptcy of the Chargor), the obligations and liabilities of the Chargor under this Charge, and the rights of the Collateral Agent under this Charge, shall continue as if such payment and release had not occurred.
		

		
			No competing interest
		

		
			12.5      Until the end of the Security Period, the Chargor shall not by virtue of any payment made hereunder on account of the Secured Obligations or by virtue of any enforcement by the Collateral Agent of its rights
		

		
			
		

		
			

		 

		

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			under, or the security constituted by, this Charge or by virtue of any relationship between or transaction involving the Chargor and/or such Company (whether such relationship or transaction shall constitute the Chargor a creditor of such Company, a guarantor of the obligations of such Company or in part subrogated to the rights of others against such Company or otherwise howsoever and whether or not such relationship or transaction shall be related to, or in connection with, the subject matter of this Charge), exercise any rights of subrogation against such Company or any other person in relation to any rights, security or moneys held or received or receivable by the Collateral Agent or any person under or in connection with the Charged Property.
		

		
			13         Collateral Agent
		

		
			The parties hereby acknowledge and agree that the Collateral Agent holds the benefit of this Charge (and any other security created in its favour pursuant to this Charge) on trust for and on behalf of the Secured Creditors in its capacity as Collateral Agent under and pursuant to the terms of the Note Documents.  The retirement of the person for the time being acting as Collateral Agent and the appointment of any successor Collateral Agent shall be effected in the manner provided for in the Note Documents. The Collateral Agent shall be entitled (i) to receive all the benefits, indemnities, powers, privileges, protections and rights contained in the Indenture, (ii) to receive an Officer’s Certificate and an Opinion of Counsel in accordance with Section 14.02 of the Indenture, and (iii) to act with the consent of the requisite Holders as provided in the Indenture, in each case in connection with acting in its capacity as Collateral Agent hereunder.
		

		
			14         Fees, costs and expenses
		

		
			The Chargor shall pay fees, costs and expenses of the Collateral Agent to the extent required of the Chargor pursuant to Section 12.10 of the Indenture.
		

		
			15         Indemnity
		

		
			The Chargor further agrees to indemnify the Collateral Agent to the extent required by the Chargor pursuant to Section 12.10 of the Indenture.
		

		
			16         Ruling Off Account
		

		
			16.1      On receiving notice that the Chargor has created a security interest over or otherwise encumbered or disposed of any of Charged Property in a transaction not permitted by the Indenture, the Collateral Agent may rule off all its accounts and open new accounts with the Chargor.
		

		
			16.2      If the Collateral Agent does not open a new account immediately on receipt of such notice, it shall nevertheless be treated as if it had done so on that day. From that day, all payments made by the Chargor to the Collateral Agent shall be treated as having been credited to a new account and shall not operate to reduce the amount owing from the Chargor to Collateral Agent at the time when it received such notice.
		

		
			
		

		
			

		 

		

			22

		

 

		

			 

		

		

		
			17         Continuing Security and Non-Merger
		

		
			17.1      The security constituted by this Charge shall be continuing and shall not be considered as satisfied or discharged by any intermediate payment or settlement of the whole or any part of the Secured Obligations or any other matter or thing whatsoever and shall be binding until the end of the Security Period.
		

		
			17.2      This Charge is in addition to and shall not merge with or otherwise prejudice or affect any banker's lien, right to combine and consolidate accounts, right of set-off or any other contractual or other right or remedy or any guarantee, lien, pledge, bill, note, charge or other security now or hereafter held by or available to the Secured Creditors.
		

		
			18         Release
		

		
			18.1      This Charge shall be terminated and released upon: (i) the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture and the satisfaction of any conditions precedent set forth therein; (ii) consent of the requisite Holders in accordance with Section 10.02 and 12.02(f) of the Indenture; or (iii) (x) the replacement of the Company as a "Collateral Rig Operator" in accordance with (a) a Fundamental Change of the Company not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 or 4.29 of the Indenture, as applicable, and (y) to the extent required by the Indenture, the entry into a new Charge by the Equity Pledgor as required by the Indenture. A partial or intermediate payment or discharge of the Secured Obligations does not entitle the Chargor to request a release (full or partial) of the Charge.
		

		
			18.2      Upon the occurrence of one of the events set out in Clause 18.1 above, and upon the written request of the Chargor and delivery of an Officer’s Certificate and Opinion of Counsel, the Collateral Agent shall: (i) release the Charged Property; (ii) release and return the certificates representing the Charged Shares, if any, to the Chargor; and (iii) execute any documentation reasonably requested by Chargor to evidence the release, in each case, at the sole expense of the Chargor.
		

		
			19         Illegality
		

		
			If at any time one or more of the provisions of this Charge becomes invalid, illegal or unenforceable in any respect, that provision shall be severed from the remainder and the validity, legality and enforceability of the remaining provisions of this Charge shall not be affected or impaired in any way.
		

		
			20         Certificate of Collateral Agent
		

		
			Any certification or determination by the Collateral Agent of a rate or amount under this Charge is, in the absence of manifest error, conclusive evidence of the matter to which it relates, including without limitation, the amount of the Secured Obligations and its reasonable costs and expenses incurred in enforcing this Charge (or any rights hereunder).
		

		
			
		

		
			

		 

		

			23

		

 

		

			 

		

		

		
			21         Amalgamation and consolidation
		

		
			The rights and benefits of the Collateral Agent under this Charge shall remain valid and binding for all purposes notwithstanding any change, amalgamation, consolidation or otherwise which may be made in the constitution of the Collateral Agent and shall be available to such entity as shall carry on the business of the Collateral Agent for the time being.
		

		
			22         Conversion of currency
		

		
			All monies received or held by the Collateral Agent subject to this Charge may be applied in accordance with the Indenture.
		

		
			23         Amendment and waiver
		

		
			23.1      This Charge shall remain in full force and effect notwithstanding any amendments or variations from time to time of the Indenture or any other Note Document.
		

		
			23.2      No variation, amendment or waiver of this Charge shall be valid unless in writing and signed by or on behalf of the parties hereto.
		

		
			24         Assignment
		

		
			24.1      The Collateral Agent may make an assignment or transfer or otherwise dispose of, the whole or any part of its rights and benefits under this Charge in accordance with the Indenture.
		

		
			24.2      The Chargor shall not assign or transfer all or any part of its rights, benefits and/or obligations under this Charge.
		

		
			25         Entire agreement
		

		
			This Charge, the Indenture and the other Note Documents constitute the entire agreement and understanding of the parties and supersede any previous agreement between the parties relating to the subject matter of this Charge.
		

		
			26         Notices
		

		
			26.1      Any communication to be made under or in connection with this Charge shall be made in writing and, unless otherwise stated, may be made by electronic communication or letter in accordance with this clause.
		

		
			26.2      The address and email address (and the department or officer, if any, for whose attention the communication is to be made) of each party for any communication or document to be made or delivered under or in connection with this Charge is:
		

		
			
		

		
			

		 

		

			24

		

 

		

			 

		

		

		
			(a)         in the case of the Chargor:
		

		
			(i)          Address: Transocean Corporate Services Limited, P.O. Box 10342, 20 Harbour Drive, Grand Cayman KY1-1003. Cayman Islands;
		

		
			(ii)        Email address: Daniel.Ro-Trock@deepwater.com;
		

		
			(iii)       Attention: Daniel Ro-Trock; and
		

		
			(b)         in the case of the Collateral Agent:
		

		
			(i)          Address: 1445 Ross Avenue, Suite 4300, MAC T9216-430 Dallas, TX 75202, USA;
		

		
			(ii)        Attention: Corporate, Municipal & Escrow Services
		

		
			or any substitute address or email address or department or officer as the Chargor may notify to the Collateral Agent or the Collateral Agent may notify to the Chargor, by not less than two Business Days' notice.
		

		
			26.3      Any communication made or delivered by one person to another under or in connection with this Charge will only be effective to the extent set forth in Section 14.01 of the Indenture.
		

		
			26.4      Any communication given under or in connection with this Charge must be in English.
		

		
			27         Miscellaneous
		

		
			27.1      Notwithstanding anything to the contrary contained herein or in any other Note Document, the amount of the obligations secured hereby shall not at any time exceed the Secured Obligations at such time.
		

		
			27.2      All sums payable by the Chargor under this Charge shall be paid without any set‐off, counterclaim, withholding or deduction whatsoever unless required by law in which event the Chargor will simultaneously with making the relevant payment under this Charge pay to the Collateral Agent such additional amount as will result in the receipt by the Collateral Agent of the full amount which would otherwise have been receivable and will supply the Collateral Agent promptly with evidence satisfactory to the Collateral Agent that the Chargor has accounted to the relevant authority for the sum withheld or deducted.
		

		
			27.3      No delay or omission on the part of the Collateral Agent in exercising any right, power or remedy under this Charge shall impair that right, power or remedy or operate as or be taken to be a waiver of it nor shall any single, partial or defective exercise of any such right, power or remedy preclude any other or further exercise under this Charge of that or any other right, power or remedy.
		

		
			
		

		
			

		 

		

			25

		

 

		

			 

		

		

		
			27.4      The Collateral Agent's rights powers and remedies under this Charge are cumulative and are not, nor are they to be construed as, exclusive of any rights, powers or remedies provided by law or otherwise and may be exercised from time to time and as often as the Collateral Agent deems expedient.
		

		
			27.5      The parties hereby agree that each agent, manager, officer, employee, director, delegate or advisor of the Collateral Agent who is not a party to this Charge (Third Party) has the express right to enforce the contractual terms of this Charge pursuant to the terms of The Contracts (Rights of Third Parties) Law, 2014.  Notwithstanding any term of this Charge, the consent of or notice to any Third Party shall not be required for any termination, rescission or agreement to any variation, waiver, assignment, novation, release or settlement under this Charge at any time.
		

		
			28         Counterparts
		

		
			This Charge may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Charge.  Delivery of an executed signature page to this Charge by facsimile or electronic transmission shall be effective as delivery of a manually signed counterpart of this Charge.
		

		
			29         Law and jurisdiction
		

		
			29.1      This Charge is governed by, and shall be construed in accordance with, the laws of the Cayman Islands.
		

		
			29.2      Each party hereto irrevocably agrees for the exclusive benefit of the other party that the courts of the Cayman Islands shall have jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute which may arise out of or in connection with this Charge and for such purposes irrevocably submits to the jurisdiction of such courts.
		

		
			
		

		
			

		 

		

			26

		

 

		

			 

		

		

		
			The parties have duly executed this Charge as a deed on the date set out at the beginning of this Charge.
		

		
			Signed as a deed by Transocean Guardian Limited
		

		
			 
		

			
					
						Signature

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			Signed by Wells Fargo Bank, National Association, as Collateral Agent
		

		
			 
		

			
					
						Signature

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			27

		

 

		

			 

		

		

		
			SCHEDULE 1
		

		
			[Initial Shares – Transocean Enabler Limited
		

		
			Fifty-thousand ordinary shares of US$1.00 of the Company (being the entire issued share capital of the Company), an exempted company incorporated under the laws of the Cayman Islands with registered number 338045 and having its registered office at Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands.]
		

		
			[Initial Shares – Transocean Encourage Limited
		

		
			Fifty-thousand ordinary shares of US$1.00 of the Company (being the entire issued share capital of the Company), an exempted company incorporated under the laws of the Cayman Islands with registered number 338042 and having its registered office at Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands.]
		

		
			
		

		
			

		 

		

			28

		

 

		

			 

		

		

		
			SCHEDULE 2
		

		
			Share Transfer
		

		
			Transocean [Enabler/Encourage] Limited (Company)
		

		
			Share Transfer
		

		
			The undersigned, Transocean Guardian Limited, (Transferor), for value received, does hereby transfer to                                                   (Transferee), the one share standing in its name in the Company to hold the same unto the said Transferee, subject to the Memorandum and Articles of Association of the Company.
		

		
			Signed by the Transferor
		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						Signature of [Name]

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			Signed by the Transferee
		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						Signature of [Name]

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			29

		

 

		

			 

		

		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			Dated this               day of                     20              
		

		
			
		

		
			

		 

		

			30

		

 

		

			 

		

		

		
			SCHEDULE 3
		

		
			Letter of Resignation
		

		
			To:        Transocean [Enabler/Encourage] Limited
		

		
			P.O. Box 10342
		

		
			36c Dr. Roy’s Drive, 4th Floor
		

		
			Grand Cayman KY1-1003
		

		
			Cayman Islands
		

		
			[ ] 2018
		

		
			Dear Sirs
		

		
			Letter of Resignation
		

		
			I hereby resign as a director of Transocean Guardian Limited (the Company) with effect from the date hereof and confirm that I have no claims against the Company for loss of office, arrears of pay or otherwise howsoever.
		

		
			Yours faithfully
		

		
			 
		

		
			                                                    
		

		
			Director
		

		
			
		

		
			

		 

		

			31

		

 

		

			 

		

		

		
			Letter of Authorisation
		

		
			 
		

		
			To:        Wells Fargo Bank, National Association, as Collateral Agent
		

		
			1445 Ross Avenue, Suite 4300
		

		
			MAC T9216-430
		

		
			Dallas, Texas 75202
		

		
			Attention: Corporate, Municipal & Escrow Services
		

		
			[ ] 2018
		

		
			Dear Sirs
		

		
			Authorisation re Letter of Resignation
		

		
			You are hereby authorised to complete and date the letter of resignation I have deposited with you today in respect of my directorship of Transocean Guardian Limited by dating the same at any time during the existence of an Event of Default (as defined in the charge over shares entered into between Transocean Guardian Limited, as chargor and Wells Fargo Bank, National Association as Collateral Agent dated            day of                        2018).
		

		
			Yours faithfully
		

		
			 
		

		
			                                                   
		

		
			Director
		

		
			 
		

		
			 
		

		
			

		 

		

			32

		

 

		

			 

		

		

		
			SCHEDULE 4
		

		
			Part I - Notice of Charge
		

		
			To:        Transocean [Enabler/Encourage] Limited
		

		
			[Date]
		

		
			Dear Sirs
		

		
			Re:  Notice of Share Charge
		

		
			We hereby notify you that pursuant to a Share Charge dated July 13, 2018 (Share Charge) between Transocean Guardian Limited (Chargor) and Wells Fargo, National Association as Collateral Agent (Collateral Agent), the Chargor has granted to the Collateral Agent a first fixed charge over the 1 shares standing in its name in Transocean [Enabler/Encourage] Limited (the Company) and all and any other shares, warrants, and other securities of any kind (including loan capital) of the Company now or at any time in the future beneficially owned by the Chargor or in which the Chargor has any interest (including any equity of redemption) and at any time after the Collateral Agent notifies you that an Event of Default (as defined in the Share Charge) has occurred and is continuing, you may take such steps as may be required to register the Collateral Agent or its nominee or nominees as the registered holder of the shares pursuant to the Share Charge.
		

		
			Please sign the enclosed acknowledgement confirming receipt of this notice.
		

		
			Yours faithfully
		

		
			 
		

		
			                                                       
		

		
			for and on behalf of
		

		
			Transocean Guardian Limited
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-33

		

 

		

			 

		

		

		
			Part II - Acknowledgement
		

		
			To:
		

		
			Transocean [Enabler/Encourage] Limited
		

		
			Wells Fargo Bank, National Association
		

		
			Dear Sirs
		

		
			Transocean [Enabler/Encourage] Limited (the Company)
		

		
			We refer to the share charge entered into between Transocean Guardian Limited (Chargor) and Wells Fargo Bank, National Association, as Collateral Agent (Collateral Agent) dated July 13, 2018 (Share Charge) in respect of shares of the Company whereby, inter alia, the Chargor granted a security interest over the Charged Property in favour of the Collateral Agent.
		

		
			Capitalised words and expressions used in this letter which are not expressly defined herein have the meanings ascribed to them in the Share Charge.
		

		
			The Company acknowledges receipt of the foregoing notice and confirms and undertakes that at any time following the occurrence of an Event of Default which is continuing, in accordance with the articles of association of the Company, it will register in the Company’s register of members any and all transfers of the Charged Property to the Collateral Agent (or its nominee or nominees) submitted to the Company by the Collateral Agent.
		

		
			IN WITNESS whereof this acknowledgement has been duly executed as a deed.
		

		
			 
		

		
			Signed by the Transocean [Enabler/Encourage] Limited
		

		
			 
		

			
					
						Signature of [Name]

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-34

		

 

		

			 

		

		

		
			SCHEDULE 5
		

		
			Irrevocable Proxy
		

		
			Transocean [Enabler/Encourage] Limited (Company)
		

		
			The undersigned, Transocean [Enabler/Encourage] Limited (Chargor) being the legal owner of all issued shares (Shares) in the share capital of the Company, hereby makes, constitutes and appoints Wells Fargo Bank, National Association, as Collateral Agent (Attorney) as the true and lawful attorney and proxy of the undersigned with full power to appoint a nominee or nominees to act hereunder from time to time and to vote the Shares at all general meetings of shareholders or stockholders of the Company with the same force and effect as the undersigned might or could do and to requisition and convene a meeting or meetings of the shareholders of the Company for the purpose of appointing or confirming the appointment of new directors of the Company and such other matters as may in the opinion of the Attorney be necessary, advisable or desirable for the purpose of implementing the Share Charge referred to below and the undersigned hereby ratifies and confirms all that the Attorney or its nominee or nominees shall do or cause to be done by virtue hereof.
		

		
			The Shares have been charged to the Collateral Agent pursuant to a Share Charge dated July 13, 2018 between the Chargor and the Collateral Agent (Share Charge).  This power and proxy is given to secure a proprietary interest of the donee of the power and is irrevocable and shall remain irrevocable as long as the Share Charge is in force.  This proxy may only be exercised in accordance with the Share Charge.
		

		
			This power and proxy is governed by, and shall be construed in accordance with, the laws of the Cayman Islands.
		

		
			IN WITNESS whereof this instrument has been duly executed on [Date] as a deed.
		

		
			 
		

		
			Signed by Transocean Guardian Limited
		

		
			 
		

			
					
						Signature of [Name]

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-35

		

 

		

			 

		

		

		
			SCHEDULE 6
		

		
			Form of Letter of Instructions from Transocean Guardian Limited to [•]
		

		
			Transocean [Enabler/Encourage] Limited
		

		
			[•]
		

		
			P.O. Box 10342,
		

		
			[70 Harbour Drive]
		

		
			Grand Cayman KY1-1003,
		

		
			Cayman Islands
		

		
			[ ] 2018
		

		
			Dear Sirs
		

		
			Transocean [Enabler/Encourage] Limited (the "Company"): Instructions to [•]
		

		
			We hereby notify you that pursuant to a charge over shares (the "Charge") dated July 13, 2018 between Transocean Guardian Limited, as chargor (the "Chargor") and Wells Fargo Bank, National Association as collateral agent (the "Collateral Agent"), the Chargor has granted a security interest in favour of the Collateral Agent over all the shares standing in its name in the Company and all other shares in the Company from time to time legally or beneficially owned by the Chargor in the Company (the "Shares").
		

		
			We refer to the registered office agreement dated [ ] between Transocean Corporate Services Limited and the Company (the "Agreement") and hereby agree that the Agreement shall be deemed to be amended by the following:
		

		
			At any time after the Chargor notifies you in writing that an Event of Default has occurred (as defined in the Charge) you are hereby authorised and entitled to rely upon the instructions of the Collateral Agent to register the Collateral Agent or its nominee or nominees (as the Collateral Agent may direct) as the registered holder of the Shares pursuant to the Charge and to otherwise comply with any directions or instructions from the Collateral Agent in relation thereto. Such authorisation and entitlement to rely upon the instructions of the Collateral Agent shall terminate upon the discharge and release of the Charge and notification of the same to you in writing by the Collateral Agent.
		

		
			We instruct you to make an annotation of the existence of the Charge and the security interests created thereby in the Company's register of members.  Such annotation shall only be removed following a release of the security interests created by the Charge and notification of the same to you in writing by the Collateral Agent.
		

		
			Please confirm by countersigning below that you agree to such amendment of the Agreement.
		

		
			Yours faithfully
		

		
			 
		

		
			                                                     
		

		
			
		

		
			

		 

		

			Appendix G-36

		

 

		

			 

		

		

		
			Authorised Signatory for and on behalf of the Company
		

		
			 
		

		
			Acknowledged and agreed.
		

		
			 
		

		
			                                                     
		

		
			Authorised Signatory for and on behalf of [•]
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-37

		

 

		

			 

		

		

		
			SCHEDULE 7
		

		
			Shareholders' Resolution
		

		
			Transocean [Enabler/Encourage] Limited (the Company)
		

		
			Written Resolution of the Sole Shareholder dated [Date]
		

		
			The undersigned, being the sole shareholder of the Company, hereby resolves as SPECIAL RESOLUTIONS that the articles of association of the Company be and they are hereby amended in the following manner:
		

		
			1            By inserting the following new definitions in Article 2(a), each in the appropriate alphabetical position:
		

			
					
						Security Interest

					
					
						    

					
					
						means any mortgage, charge or other security interest in shares in the Company in favour of the Secured Party pursuant to the Share Charge, which is notified to the Company in writing by or on behalf of the Shareholder granting such mortgage, charge or other security interest

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Share Charge

					
					
						 

					
					
						means the equitable share charge by Transocean Guardian Limited of all the shares in the Company registered in its name (and certain derivative rights) in favour of the Secured Party

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Secured Party 

					
					
						 

					
					
						means Wells Fargo Bank, National Association in its capacity as Collateral Agent under the Share Charge, and its successors and assigns

				

		
			 
		

		
			2            By adding a new Article 6A, immediately after Article 6, as follows:
		

		
			“No shares which are subject to any Security Interest may be redeemed or repurchased by, or surrendered to, the Company."
		

		
			3            By adding the following sentence at the end of Article 7:
		

		
			“The Company shall at no time have any liens on any shares (or amounts payable thereon) which are subject to a Security Interest.”
		

		
			4            By adding the following sentence at the end of Article 11:
		

		
			“The Directors shall not make any calls in respect of any shares that are subject to a Security Interest.”
		

		
			5            By adding a new Article 23A, immediately after Article 23, as follows:
		

		
			
		

		
			

		 

		

			Appendix G-38

		

 

		

			 

		

		

		
			“Notwithstanding the foregoing, the provisions of these Articles as to forfeiture shall not apply to any shares which are subject to a Security Interest.”
		

		
			6            By adding the following as a new paragraph at the end of Article 26:
		

		
			“Notwithstanding anything to the contrary contained within these Articles, the Directors shall not register a transfer of any shares which are subject to a Security Interest without the prior written consent of the Secured Party, and the Directors shall register any transfer in favour of the Secured Party or any person whom the Secured Party nominates pursuant to the Share Charge as the holder of any shares subject to such Security Interest upon the enforcement of such Security Interest.  Furthermore, no transferor of any shares (or proposed transferor of shares) to the Secured Party (or its nominee or nominees) nor the Secured Party (or its nominee or nominees) shall be required to offer the shares (which are or are to be the subject of any transfer aforesaid) to the Shareholders (or to any of the Shareholders), and no such Shareholder shall have any right under the Articles or otherwise howsoever to require such shares to be transferred to them whether for consideration or not.”
		

		
			7            By adding the following proviso to the end of the second sentence of Article 26:
		

		
			"provided that at no time shall the Directors suspend the registration of the transfers of any shares that are subject to a Security Interest."
		

		
			8            By adding a new Article 60A, immediately after Article 60, as follows:
		

		
			“An appointment of a proxy by a Shareholder in favour of any person to whom that Shareholder has granted a Security Interest over shares may be expressed to be irrevocable (an Irrevocable Proxy) and no Irrevocable Proxy shall be revoked without the prior written consent of the person appointed as proxy under such Irrevocable Proxy for so long as any obligation secured by the Security Interest in favour of such person remains outstanding.  Notwithstanding any provision contained in these Articles to the contrary, an Irrevocable Proxy shall not require the approval of the Directors as to its form and for the avoidance of doubt, where a Shareholder has appointed a person to be his proxy pursuant to an Irrevocable Proxy such Shareholder shall not be entitled to vote such shares personally or by any subsequently appointed proxy.”
		

		
			 
		

		
			                                                     
		

		
			Transocean Guardian Limited
		

		
			By:
		

		
			Title:
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix G-39

		

 

		

			 

		

		

		
			APPENDIX F
		

		
			FORM OF ASSIGNMENT OF EARNINGS
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix F-1

		

 

		

			 

		

		

		
			FORM OF
		

		
			ASSIGNMENT OF EARNINGS
		

		
			given by
		

		
			SONGA OFFSHORE RIG 3 AS
		

		
			as the Assignor
		

		
			in favor of
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION,
		

		
			as the Assignee
		

		
			 
		

		
			July 13, 2018
		

		
			SONGA [ENABLER/ENCOURAGE]
		

		
			 
		

		
			THIS ASSIGNMENT OF EARNINGS (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, this “Assignment”) is made by Songa Offshore Rig 3 AS, a Norwegian private limited liability company with registration number 913 292 073 and registered address at Maskinveien 26, 4033 Stavanger (the “Assignor”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral agent (in such capacity, the “Collateral Agent”) for the Secured Creditors (as defined in the Indenture referred to below) (together with its successors and assigns in such capacity, the “Assignee”).
		

		
			W I T N E S S E T H   T H A T:
		

		
			WHEREAS:
		

		
			(A)        Transocean [Enabler/Encourage] Limited, a Cayman Islands exempted company by limited shares (“OwnCo”), is the sole owner of the whole of the Norwegian registered drillship Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”);
		

		
			(B)        The Assignor charters the Collateral Rig from OwnCo pursuant to that certain Bareboat Charter, dated November 13, 2014 (as amended, restated, supplemental, replaced, assigned or otherwise modified from time to time, the “Bareboat Charter”), between Assignor and Ownco;
		

		
			 (C)       With respect to the Collateral Rig, the Assignor is party to a drilling contract (Contract No. [SAP4600016880/SAP4600016879]), dated as of February 23, 2012 (as amended, restated, amended and restated or otherwise modified from time to time, the “Equinor Contract”) with Equinor Energy AS (formerly known as Statoil Petroleum AS), a subsidiary of Equinor ASA (“Equinor”);
		

		
			(D)        The Assignor has agreed to grant security interests on certain of its assets as collateral security for the payment and performance of the Notes Obligations (as defined in the Indenture) in connection with that certain Indenture dated as of the date hereof (as the same may be amended, restated, amended and restated,
		

		
			
		

		
			

		 

		

			Appendix G-2

		

 

		

			 

		

		

		
			supplemented, refinanced, replaced or otherwise modified from time to time, the “Indenture”), by and among Transocean Guardian Limited, a Cayman Islands exempted company, as issuer, the Guarantors party thereto from time to time and Wells Fargo Bank, National Association, as trustee and as Collateral Agent; and
		

		
			NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged by the Assignor, the Assignor hereby agrees as follows:
		

		
			Article 1 Defined Terms.  Except as otherwise defined herein, terms defined in the Indenture shall have the same meanings when used herein.
		

		
			“Earnings” shall mean (i) all earnings, including without limitation all freight, hire, income and passage moneys or claims for money now or hereafter earned or to be earned or payable or to be paid to the Assignor as a consequence of the operation of the Collateral Rig, including without limitation, all payments earned or to be earned and payable or to be paid under or in connection with the Equinor Contract or any other Drilling Contract of any kind in respect of the Collateral Rig to which the Assignor is a party in respect of the Collateral Rig, including any termination payments or settlement payments in respect thereof and all other rights under the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to receive such earnings, (ii) any claim under any guarantee in respect of the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to which the Assignor is a party or otherwise related to earnings, freight, hire, income or passage moneys, in each case payable or to be paid to the Assignor as a consequence of the operation of the Collateral Rig, (iii) any other money whatsoever now or hereafter due or to become due to the Assignor in relation to or attributable to the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to which the Assignor is a party and (iv) any other money received directly or indirectly by the Assignor under the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to which Assignor is a party.
		

		
			“Earnings Account” means any Earnings Account (as defined in the Indenture) in respect of the Collateral Rig pledged by the Assignor in favor of the Collateral Agent pursuant to the Note Documents.
		

		
			“Indenture” has the meaning ascribed to it in Whereas Clause D of this Assignment.
		

		
			Article 2 Grant of Security. As collateral security for the prompt and complete payment and performance when due or to become due (whether at the stated maturity, by acceleration or otherwise) of the Notes Obligations, the Assignor, as legal and beneficial owner, does hereby collaterally assign, transfer and set over unto the Assignee, for the ratable benefit of the Secured Creditors, and does hereby grant the Assignee, for the ratable benefit of the Secured Creditors, a continuing lien and security interest in, all of the Assignor’s right, title and interest in, to and under all Earnings and all proceeds thereof, in each case, now or hereafter arising or in which the Assignor now has or in the future may acquire any right, title or interest (collectively, the “Earnings Collateral”). For the purpose of the security interest, the Notes Obligations are limited to $900,000,000.
		

		
			Article 3 Notice of Assignment.  Within 7 Business Days of the date of this Assignment, in connection with the Equinor Contract, and promptly upon its entry into any new Drilling Contract, the Assignor shall give notice, substantially in the form attached hereto as Exhibit 1, of this Assignment to the counterparty to such contract, as applicable.
		

		
			Article 4 Performance under the Equinor Contract or any Other Drilling Contract in respect of the Collateral Rig; No Duty of Inquiry.  The Assignor hereby covenants and undertakes
		

		
			
		

		
			

		 

		

			Appendix G-3

		

 

		

			 

		

		

		
			that, notwithstanding the assignment herein contained, it shall punctually perform all its material obligations under the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to which it is a party. It is hereby expressly agreed that, anything contained herein to the contrary notwithstanding, the Assignor shall remain liable under the Equinor Contract or any other Drilling Contract in respect of the Collateral Rig to which it is a party and shall perform its obligations thereunder, and the Assignee shall have no obligation or liability under the Equinor Contract or such other Drilling Contract by reason of or arising out of the assignment contained herein, nor shall the Assignee be required to assume or be obligated in any manner to perform or fulfill any obligation of the Assignor under or pursuant to the Equinor Contract or such other Drilling Contract to make any payment or make any inquiry as to the nature or sufficiency of any payment received by the Assignee, or to present or file any claim or to take any other action to collect or enforce the payment of any amounts which may have been assigned to it or to which it may be entitled hereunder or pursuant hereto at any time or times.
		

		
			Article 5 Power of Attorney.  The Assignor does hereby irrevocably appoint and constitute the Assignee as the Assignor’s true and lawful attorney-in-fact with full power (in the name of the Assignor or otherwise) to ask, require, demand, receive, compound and give acquittance for any and all moneys and claims for moneys due or to become due assigned hereby, to endorse any checks or other instruments or orders in connection therewith, to file any claims or take any action or institute any proceedings which the Assignee or its legal counsel may deem to be necessary or advisable and otherwise to do any and all things which the Assignor itself could do in relation to the Earnings Collateral. Anything in this Section 5 to the contrary notwithstanding, (a) the Assignee agrees that it will not exercise any rights under the power of attorney provided for in this Section 5 unless an Event of Default shall have occurred and be continuing, and (b) the parties agree that the grant of the power of attorney set forth in this Section 5 shall not be deemed to create an obligation on the part of the Assignee to take any one or more of the actions described herein.
		

		
			Article 6 UCC Filings.  The Assignor does hereby authorize the Assignee to do all things the Assignee may deem to be necessary or advisable in order to perfect or maintain the security interest granted by this Assignment including, but not limited to, filing any and all Uniform Commercial Code financing statements or renewals thereof in any applicable jurisdictions. For the avoidance of doubt, nothing herein shall require the Assignee to file any such financing statements or any continuation statements, or be responsible for maintaining the security interests purported to be created by this Assignment (except for the custody of any Earnings Collateral in its possession and the accounting for moneys actually received by it under this Assignment in accordance with the Indenture) and such responsibility shall be solely that of the Assignor.
		

		
			Article 7 Application of Proceeds. All moneys collected or received from time to time by the Assignee pursuant to this Assignment shall be immediately deposited into the Earnings Account and applied in accordance with the terms of the Indenture.
		

		
			Article 8 Earnings Account. The Assignor shall procure that all Earnings are promptly credited to the Earnings Account.
		

		
			Article 9 Limitations on Liability.4
		

		
			SECTION 9.01. The obligations of the Assignor under this Assignment will be limited, subject to Section 9.2 below, by mandatory provisions of law applicable to the Assignor limiting the  legal capacity or ability of the Assignor to provide security under this Assignment (including, but not
		

		

		
			4         NTD: Under review by Norwegian counsel.
		

		
			
		

		
			

		 

		

			Appendix G-4

		

 

		

			 

		

		

		
			limited to, the provisions of Sections 8-7 and 8-10, cf. 1-3 and 1-4 of the Norwegian Limited Liability Companies Act of 1997), regulating unlawful financial assistance and other prohibited loans, guarantees and joint and several liability as well as providing of security.
		

		
			SECTION 9.02. If any limitation herein is no longer applicable as a mandatory provision under Norwegian law, that limitation will no longer apply to the security provided under this Assignment.
		

		
			Article 10 Miscellaneous.
		

		
			SECTION 10.01.            Further Assurances. The Assignor agrees that if the Collateral Agent determines this Assignment is insufficient in whole or in part to create a valid security interest in the Earnings Collateral or if such security interest ceases to be a first priority security interest in the Earnings Collateral (subject to Permitted Collateral Liens), it shall, as reasonably requested by the Collateral Agent, execute or cause to be executed such other documents or deliver or cause to be delivered such further assurances as may be necessary in order to create a valid security interest in the Earnings Collateral or to maintain the security interest granted hereunder as a first priority security interest in the Earnings Collateral (subject to Permitted Collateral Liens).
		

		
			SECTION 10.02.            Remedies Cumulative and Not Exclusive; No Waiver. No failure on the part of the Assignee or any other Secured Creditor to exercise, and no delay in exercising any right hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. Neither the execution nor the delivery of this Assignment shall in any manner impair or affect other security for the Notes Obligations. The rights and remedies of the Assignee provided herein and in the other Note Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law or otherwise.
		

		
			SECTION 10.03.           Successors and Assigns. This Assignment and all obligations of the Assignor hereunder shall be binding upon the successors and assigns of the Assignor and shall, together with the rights and remedies of the Assignee hereunder, inure to the benefit of the Assignee, its respective successors and assigns.
		

		
			SECTION 10.04.            Waiver; Amendment. No amendment, modification or waiver of any provision of this Assignment, and no consent to any departure by the Assignor herefrom, shall be effective unless the same is in writing and conforms to the requirements set forth in Article 10 of the Indenture.
		

		
			SECTION 10.05.          Invalidity. Any provision of this Assignment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof or thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
		

		
			SECTION 10.06.            Notices. All notices, requests, demands or other communications pursuant hereto shall be given in accordance with Section 14.01 of the Indenture.  Notices shall be deemed to have been given as set forth in Section 14.01 of the Indenture.  All notices and other communications shall be in writing and addressed to such party as provided in the Indenture or in any case at such other address as such party may hereafter notify the other party hereto in writing.
		

		
			SECTION 10.07.            Electronic Delivery. Delivery of an executed copy of this Assignment by facsimile or electronic transmission shall be deemed as effective as delivery of an originally executed copy. In the event that the Assignor delivers an executed copy of this Assignment by facsimile or
		

		
			
		

		
			

		 

		

			Appendix G-5

		

 

		

			 

		

		

		
			electronic transmission, the Assignor shall also deliver an originally executed copy as soon as practicable, but the failure of the Assignor to deliver an originally executed copy of this Assignment shall not affect the validity or effectiveness of this Assignment.
		

		
			SECTION 10.08.           References. References herein to Sections and Exhibits are to be construed as references to sections of, and exhibits to, this Assignment, unless the context otherwise requires.
		

		
			SECTION 10.09.           Headings. In this Assignment, Section headings are inserted for convenience of reference only and shall not be taken into account in the interpretation of this Assignment.
		

		
			SECTION 10.10.            Termination. Upon (i) the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture and subject to the satisfaction of any conditions precedent set forth therein, (ii) consent of the requisite Holders in accordance with Sections 10.02 and 12.02(f) of the Indenture, or (iii) (x) the replacement of Assignor as the “Collateral Rig Operator” with respect to the Collateral Rig in accordance with (a) a Fundamental Change of Assignor not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 or 4.29 of the Indenture, as applicable, and (y) the entry into a new Assignment of Earnings by any replacement Collateral Rig Operator as required by the Indenture, the assignment and continuing security interest granted hereby shall automatically terminate and be released and all rights to the Earnings Collateral shall revert to the Assignor. Upon any such termination, the Assignee will, at the Assignor’s sole expense, execute and deliver to the Assignor such documents as the Assignor shall reasonably request to evidence such termination.
		

		
			SECTION 10.11.            Discretion of the Assignee. Notwithstanding anything else to the contrary herein, the Assignee shall not have any duty to take any discretionary action or exercise any discretionary powers; provided,  however, that if the taking or exercise of any such discretionary action could reasonably be expected to expose the Assignee to any loss, liability or expense, the Assignee shall have received, upon request therefor, from the Holders indemnity or security (or both) satisfactory to it against such loss, liability or expense that might be incurred in connection therewith. Whenever reference is made herein to any discretionary action by, consent, designation, specification, requirement or approval of, notice, request or other communication from, or other direction given or action to be undertaken or to be (or not to be) suffered or omitted by the Assignee or to any election, decision, opinion, acceptance, use of judgment, expression of satisfaction or other exercise of discretion, rights or remedies to be made (or not to be made) by the Assignee, it is understood that in all cases the Assignee shall have no duty and shall be fully justified in failing or refusing to take any such action under unless it shall have received written instructions from the Holders of at least a majority in principal amount of the Outstanding Securities.
		

		
			Article 11 Governing Law, Jurisdiction and Waivers.
		

		
			11.1
		

		
			(i)          THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS ASSIGNMENT SHALL BE BROUGHT IN ACCORDANCE WITH SECTION 1.04 OF THE INDENTURE. THE ASSIGNOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS AND SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS DESCRIBED IN SECTION 1.04 OF THE INDENTURE AS THOUGH EACH REFERENCE THEREIN TO THE “COMPANY” IS A REFERENCE TO THE ASSIGNOR.
		

		
			
		

		
			

		 

		

			Appendix G-6

		

 

		

			 

		

		

		
			(ii)         THE ASSIGNOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT OR ANY APPELLATE COURT WITH RESPECT THERETO AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT.
		

		
			(iii)       EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
		

		
			SECTION 11.02.           Conflict.  In the event of a direct conflict between this Assignment and the Indenture, the Indenture shall control; provided,  however, the parties understand and agree that this Assignment sets forth additional covenants, obligations and rights and the parties will use all reasonable efforts to construe the provisions and covenants in this Assignment as not being in direct conflict with the Indenture.
		

		
			[Signature page follows]
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix G-7

		

 

		

			 

		

		

		
			IN WITNESS WHEREOF, the Assignor has caused this Assignment to be duly executed and delivered on the day and year first above written.
		

			
					
						 

					
					
						SONGA OFFSHORE RIG 3 AS

				
	
					
						 

					
					
						as the Assignor

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix F-8

		

 

		

			 

		

		

		
			Acknowledged and Agreed to on the day and year first above written:
		

		
			 
		

			
					
						 

					
					
						WELLS FARGO BANK, NATIONAL

				
	
					
						 

					
					
						ASSOCIATION, as the Assignee

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix F-9

		

 

		

			 

		

		

		
			 
		

		
			EXHIBIT 1
		

		
			FORM OF EARNINGS ASSIGNMENT NOTICE
		

		
			TO:      [Counterparty to the Equinor Contract or any other Drilling Contract]
		

		
			TAKE NOTICE:
		

		
			(i)          that by an Assignment of Earnings dated as of July 13, 2018 (the “Assignment”) made by us (the “Assignor”) to Wells Fargo Bank, National Association, as the Collateral Agent (as defined in the Assignment) for the benefit of the Secured Creditors (as defined in the Assignment) (together with its successors and assigns in such capacity, the “Assignee”), we, the operator of the Norwegian registered drillship Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”) have assigned to the Assignee a security interest in all our right, title and interest in and to:
		

		
			(1)         all earnings, including without limitation, all freight, hire, income and passage moneys or claims for money now or hereafter earned or to be earned payable to the Assignor as a consequence of the operation of the Collateral Rig, including without limitation all payments earned or to be earned and payable or to be paid under or in connection with [describe applicable Drilling Contract], of every kind, including any termination payments or settlement payments in respect thereof and all other rights under [describe applicable Drilling Contract] to receive such earnings;
		

		
			(2)         any claim under any guarantee in respect of the [describe applicable Drilling Contract] or otherwise related to earnings, freight, hire, income or passage moneys, in each case payable to the Assignor as a consequence of the operation of the Collateral Rig;
		

		
			(3)         any other money whatsoever now or hereafter due or to become due to the Assignor in relation to or attributable to the [describe applicable Drilling Contract, including termination payments or settlement payments in respect thereof]; and
		

		
			(iv)        any other money received directly or indirectly under the [describe applicable Drilling Contract] by the Assignor.
		

		
			(ii)         that you are hereby irrevocably authorized and instructed to pay as from the date hereof all of such aforesaid moneys as follows (or, after the occurrence of an Event of Default, to such other account as the Assignee may direct from time to time by written notice):
		

		
			 
		

			
					
						 

				
	
					
						Bank Name:  [_____]1

				
	
					
						Address: [_____]

				
	
					
						Account Name: [_____]

				
	
					
						Account Number: [_____]

				
	
					
						ABA/Routing: [_____]

				
	
					
						Swift: [_____]

				

		
			 
		

		

		
			1         Add information for Earnings Account.
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix F-10

		

 

		

			 

		

		

		
			 
		

		
			DATED: [—], 20[—]
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-11

		

 

		

			 

		

		

		
			 
		

			
					
						 

					
					
						SONGA OFFSHORE RIG 3 AS

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			

		 

		

			Appendix G-12

		

 

		

			 

		

		

		
			APPENDIX G
		

		
			FORM OF ASSIGNMENT OF INSURANCES
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-1

		

 

		

			 

		

		

		
			 
		

		
			FORM OF
		

		
			ASSIGNMENT OF INSURANCES
		

		
			given by
		

		
			TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED,
		

		
			TRANSOCEAN INC.
		

		
			and
		

		
			SONGA OFFSHORE RIG 3 AS
		

		
			as the Assignors
		

		
			in favor of
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION, as Collateral Agent
		

		
			as the Assignee
		

		
			 
		

		
			July 13, 2018
		

		
			SONGA [ENABLER/ENCOURAGE]
		

		
			THIS ASSIGNMENT OF INSURANCES (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, this “Assignment”) is made by TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED, a Cayman Islands exempted company (“OwnCo”), TRANSOCEAN INC., a Cayman Islands exempted company (“TINC”), and SONGA OFFSHORE RIG 3 AS, a Norwegian private limited liability company with registration number 913 292 073 and registered address at Maskinveien 26, 4033 Stavanger (“OpCo” and, together with OwnCo and TINC, collectively, the “Assignors” and each, individually, an “Assignor”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, as the collateral agent (in such capacity, the “Collateral Agent”) for the Secured Creditors (as defined in the Indenture referred to below) (together with its successors and assigns in such capacity, the “Assignee”).
		

		
			W I T N E S S E T H    T H A T :
		

		
			WHEREAS:
		

		
			OwnCo is the sole owner of the whole of the Norwegian registered drillship Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”) and each Assignor has an interest in the Insurances (as defined below);
		

		
			Pursuant to the Indenture dated as of the date hereof (as the same may be amended, restated, amended and restated, supplemented, refinanced, replaced or otherwise modified from time to time, the “Indenture”), by and among Transocean Guardian Limited, a Cayman Islands exempted company (together with its successors and permitted assigns, the “Company”), the Guarantors (as defined therein) party thereto from time to time (including the Assignor, other than OpCo) and Wells Fargo Bank,
		

		
			
		

		
			

		 

		

			Appendix G-2

		

 

		

			 

		

		

		
			National Association, as trustee and the Collateral Agent, the Company will issue 5.875% Senior Secured Notes due 2024 in an aggregate principal amount of $750,000,000 on the date hereof;  and
		

		
			Pursuant to the Indenture, each Assignor is required to execute this Assignment to give security for all of the Notes Obligations (as defined in the Indenture under the Note Documents (as defined in the Indenture).
		

		
			NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged by the Assignor, the Assignor hereby agrees as follows:
		

		
			SECTION 1.    Defined Terms.  Except as otherwise defined herein, terms defined in the Indenture shall have the same meanings when used herein.
		

		
			“Indenture” has the meaning ascribed to it in Whereas Clause B of this Assignment.
		

		
			“Insurances” means policies and contracts of insurance from time to time taken out by or on behalf of any Assignor (as further identified in any notice sent hereunder) insuring physical damage to the Collateral Rig, including but not limited to (i) hull and machinery (including hull interest insurance, increased value insurance and freight interest insurances, if any) and (ii) war risk.
		

		
			“Insurance Proceeds” means all monies payable to any Assignor under or in connection with (i) the Insurances, whether heretofore, now or hereafter effected, and all renewals or replacements for same, and (ii) all claims, returns of premium or other amounts and other moneys due and to become due under or in respect of Insurances, other than returns of premium not related to physical damage to the Collateral Rig.
		

		
			“Requisition Compensation” means, in relation to the Collateral Rig, any compensation paid or payable by a government entity for the requisition for title, confiscation or compulsory acquisition of the Collateral Rig.
		

		
			“OwnCo Account” means any Bareboat Account in respect of the Collateral Rig pledged by OwnCo in favor of the Collateral Agent pursuant to the Note Documents.
		

		
			“OpCo Account” means any Earnings Account in respect of the Collateral Rig pledged by OpCo in favor of the Collateral Agent pursuant to the Note Documents.
		

		
			SECTION 2.    Grant of Security.  As collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Notes Obligations, each Assignor, as legal and beneficial owner, does hereby collaterally assign, transfer and set over unto the Assignee, for the benefit of the Secured Creditors, and does hereby grant the Assignee, for the benefit of the Secured Creditors, a continuing security interest in, all of such Assignor’s right, title and interest in, to and under the following (collectively, the “Insurance Collateral”): (a) all Insurances, (b) all Insurance Proceeds, (c) all Requisition Compensation and (d) all proceeds of the foregoing, other than returns of premium not related to physical damage to the Collateral Rig. For the purpose of the security interest created by OpCo, the Notes Obligations are limited to $900,000,000.
		

		
			 
		

		
			SECTION 3.     Loss Payable Clauses.  Each Assignor shall ensure that: all Insurances, as such Insurances relate to the Collateral Rig, in respect of hull and machinery (including hull interest insurance, increased value insurance, freight interest insurances, if any and war risk) shall contain a loss
		

		
			
		

		
			

		 

		

			Appendix G-3

		

 

		

			 

		

		

		
			payable clause in substantially the form attached hereto as Exhibit 1.  Insurances for the Collateral Rig in respect of:
		

		
			(a)         an Event of Loss or any loss that results in Insurance Proceeds greater than $25,000,000, shall be payable to the Assignee in accordance with the loss payable clause as described in Exhibit 1;  provided that, other than in the case of an Event of Loss, such Insurance Proceeds shall be paid by the Assignee to the applicable Assignor designated by OwnCo upon the delivery to Assignee of an Officer’s Certificate certifying that (i) no Event of Default has occurred and is continuing, (ii) no Event of Loss has occurred, and (iii) such Insurance Proceeds shall be applied to the reimbursement for repair and/or replacement of damaged property of the Collateral Rig and for other covered expenses under the Insurances; and
		

		
			(b)         any loss that results in Insurance Proceeds of equal to or less than $25,000,000, shall be payable to the applicable Assignor as designated by OwnCo for reimbursement for repair and/or replacement of damaged property of the Collateral Rig and for other covered expenses under the Insurances in accordance with the loss payable clause until any time at which an Event of Default has occurred and is continuing, at which time the Assignee may direct the insurers to pay such moneys to the Assignee.
		

		
			SECTION 4.    Covenants and Undertakings; Notices.  Each Assignor hereby covenants with the Assignee and undertakes that:
		

		
			(a)         it shall do or permit to be done each and every act or thing which the Assignee may from time to time require to be done for the purpose of enforcing the Assignee’s rights under this Assignment and shall allow its name to be used as and when required by the Assignee for that purpose;
		

		
			(b)         it shall forthwith give notice substantially in the form annexed hereto as Exhibit 2, or cause its insurance brokers to give notice, of this Assignment to all insurers, underwriters, clubs and associations providing the Insurances and request that such notice be endorsed on all the policies and entries of Insurances; and
		

		
			(c)         as an inducement to the Assignee to accept this Assignment, that (i) the Insurances are in full force and effect and are enforceable in accordance with their respective terms, (ii) such Assignor is not in default under the Insurances such that the Insurances could be or are cancelled, terminated, discharged, suspended, avoided or materially modified, (iii) no entity other than the signatories hereto has any interest in any of the Insurances (except any entity which has previously assigned such interest to the Assignee), and (iv) it has not assigned, pledged or in any way created or suffered to be created any security interest in the whole or any part of the right, title and interest in the Insurance Collateral, except for Permitted Collateral Liens.
		

		
			SECTION 5.    No Duty of Inquiry.  The Assignee shall not be obliged to make any inquiry as to the nature or sufficiency of any payment received by it hereunder or to make any claim or take any other action to collect any moneys or to enforce any rights and benefits hereby assigned to the Assignee or to which the Assignee may at any time be entitled hereunder. The Assignors shall remain liable to perform all of their obligations in relation to the Insurance Collateral and the Assignee shall be under no obligation of any kind whatsoever in respect thereof or be under any liability whatsoever (including, without limitation, any obligation or liability with respect to the payment of premiums, calls, assessments or any other sums at any time due and owing in respect of the Insurances) in the event of any failure by the Assignors to perform such obligations.
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-4

		

 

		

			 

		

		

		
			SECTION 6.    Power of Attorney.  Each Assignor does hereby irrevocably appoint and constitute the Assignee as such Assignor’s true and lawful attorney-in-fact with full power (in the name of such Assignor or otherwise) to ask, require, demand, receive, compound and give acquittance for any and all moneys and claims for moneys assigned hereby, to endorse any checks or other instruments or orders in connection therewith, to file any claims or take any action or institute any proceedings which the Assignee may deem to be necessary or advisable and otherwise to do any and all things which such Assignor itself could do in relation to the Insurance Collateral. Anything in this Section 6 to the contrary notwithstanding, (a) the Assignee agrees that it will not exercise any rights under the power of attorney provided for in this Section 6 unless an Event of Default shall have occurred and be continuing, and (b) the parties agree that the grant of the power of attorney set forth in this Section 6 shall not be deemed to create an obligation on the part of the Assignee to take any one or more of the actions described herein.
		

		
			 
		

		
			SECTION 7.    UCC Filings.  Each Assignor does hereby authorize the Assignee to do all things the Assignee may deem to be necessary or advisable in order to perfect or maintain the security interest granted by this Assignment including, but not limited to, filing any and all Uniform Commercial Code financing statements or renewals thereof in any applicable jurisdictions. For the avoidance of doubt, nothing herein shall require the Assignee to file any such financing statements or any continuation statements, or be responsible for maintaining the security interests purported to be created by this Assignment (except for the safe custody of any Insurance Collateral in its possession and the accounting for moneys actually received by it under this Assignment) and such responsibility shall be solely that of each Assignor.
		

		
			SECTION 8.     Application of Proceeds.
		

		
			(a)         All Requisition Compensation received by an Assignor shall be immediately deposited into either the OwnCo Account or the OpCo Account and shall be applied in accordance with the terms of the Indenture.
		

		
			(b)         Absent an Event of Loss, all moneys collected or received from time to time by an Assignor pursuant to this Assignment (other than Requisition Compensation) shall be immediately deposited as designated by OwnCo into either the OwnCo Account or the OpCo Account and shall be applied to the reimbursement for repair and/or replacement of damaged property of the Collateral Rig and for other covered expenses under the Insurances.
		

		
			(c)         All Insurance Proceeds received by the Assignee as a result of an Event of Loss shall be held by the Assignee to be applied to a mandatory redemption if and when required pursuant to Section 3.09(b) of the Indenture, or as otherwise described in this Section 8(c).  Upon receipt of such Insurance Proceeds, the Assignee will give written notice of such receipt to the Company.  Following receipt of such notice, the Company will give the notices required by Section 3.09(d) of the Indenture as if the Company had received such Insurance Proceeds on the date of receipt of such notice, and on or prior to the redemption date designated by the Company in the applicable notice, the Assignee will deposit such Insurance Proceeds with the Paying Agent to be applied to the redemption price, in accordance with Sections 3.05 and 3.09(b) of the Indenture.  To the extent that such Insurance Proceeds exceed the redemption price, the Assignee will remit to the applicable Assignor such excess, and such excess shall be immediately deposited into either the OwnCo Account or the OpCo Account as designated by OpCo.  Notwithstanding the foregoing, if pursuant to the proviso in Section 3.09(b) of the Indenture, no redemption is required under Section 3.09(b) thereof, the Company will deliver an Officer’s Certificate certifying that no such redemption is required pursuant to such provision, and the Assignee will pay such Insurance Proceeds to the applicable Assignor designated by the Company in such Officer’s Certificate.
		

		
			
		

		
			

		 

		

			Appendix G-5

		

 

		

			 

		

		

		
			SECTION 9.     Miscellaneous.
		

		
			9.1        Further Assurances.  Each Assignor agrees that if this Assignment shall at any time be insufficient in whole or in part to create a valid security interest in the Insurance Collateral pledged by it, it shall execute or cause to be executed such other documents or deliver or cause to be delivered such further assurances as may be necessary in order to create a valid security interest in such Insurance Collateral.
		

		
			9.2        Remedies Cumulative and Not Exclusive; No Waiver.  No failure on the part of the Assignee or any Secured Creditor to exercise, and no delay in exercising any right hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. Neither the execution nor the delivery of this Assignment shall in any manner impair or affect other security for the Notes Obligations. The rights and remedies of the Assignee provided herein and in the other Security Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law or otherwise.
		

		
			9.3        Successors and Assigns.  This Assignment and all obligations of the Assignors hereunder shall be binding upon the successors and assigns of the Assignors and shall, together with the rights and remedies of the Assignee hereunder, inure to the benefit of the Assignee and its successors and assigns.
		

		
			9.4        Waiver; Amendment.  No amendment, modification or waiver of any provision of this Assignment, and no consent to any departure by the Assignors herefrom, shall be effective unless the same is in writing and conforms to the requirements set forth in Article 10 of the Indenture.
		

		
			9.5        Invalidity.  Any provision of this Assignment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof or thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
		

		
			9.6        Notices.  All notices, requests, demands or other communications pursuant hereto shall be given in accordance with Section 14.01 of the Indenture.  Notices shall be deemed to have been given as set forth in Section 14.01 of the Indenture.  All notices and other communications shall be in writing and addressed to such party as provided in the Indenture or in any case at such other address as such party may hereafter notify the other party hereto in writing.
		

		
			9.7        Electronic Delivery.  Delivery of an executed copy of this Assignment by facsimile or electronic transmission shall be deemed as effective as delivery of an originally executed copy. In the event that any Assignor delivers an executed copy of this Assignment by facsimile or electronic transmission, such Assignor shall also deliver an originally executed copy as soon as practicable, but the failure of such Assignor to deliver an originally executed copy of this Assignment shall not affect the validity or effectiveness of this Assignment.
		

		
			9.8        References.  References herein to Sections and Exhibits are to be construed as references to sections of, and exhibits to, this Assignment, unless the context otherwise requires.
		

		
			9.9        Headings.  In this Assignment, Section headings are inserted for convenience of reference only and shall not be taken into account in the interpretation of this Assignment.
		

		
			
		

		
			

		 

		

			Appendix G-6

		

 

		

			 

		

		

		
			9.10      Termination.  Upon the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture, the continuing security interest granted hereby shall automatically terminate and be released and all rights to the Insurance Collateral shall automatically revert to the Assignors.  The security interest granted hereby shall, in whole or in part, automatically terminate and be released and all rights to the Insurance Collateral so released shall automatically revert to the Assignors, upon consent of the requisite Holders in accordance with Sections 10.02 and 12.02(f) of the Indenture.  Upon (x) the replacement of OwnCo as the “Collateral Rig Owner” with respect to the Collateral Rig or the replacement of the Collateral Rig, in each case in accordance with (a) a Fundamental Change of OwnCo not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 or 4.29 of the Indenture, as applicable, and (y) the entry into a new Assignment of Insurances by any replacement Collateral Rig Owner and/or any other Member of the Consolidated Group, as required by the Indenture, the continuing security interest granted by OwnCo hereunder shall automatically terminate and be released and all rights to OwnCo’s Insurance Collateral shall automatically revert to OwnCo.  Upon (x) the replacement of OpCo as the “Collateral Rig Operator” with respect to the Collateral Rig or the replacement of the Drilling Contract, in each case in accordance with (a) a Fundamental Change of OpCo not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 or 4.29 of the Indenture, as applicable, and (y) the entry into a new Assignment of Insurances by any replacement Collateral Rig Operator and/or any other Member of the Consolidated Group, as required by the Indenture, the continuing security interest granted by OpCo hereunder shall automatically terminate and be released and all rights to OpCo’s Insurance Collateral shall automatically revert to OpCo.  Upon (x) the merger, consolidation, replacement or a sale of assets of TINC in accordance with a Fundamental Change of TINC not prohibited by Section 4.13 of the Indenture and (y) the entry into a new Assignment of Insurances by TINC or its successor as required by the Indenture, the continuing security interest granted by TINC hereunder shall automatically terminate and be released and all rights to TINC’s Insurance Collateral shall automatically revert to TINC.  Upon any such termination, the Assignee will, at the Assignor’s sole expense, execute and deliver to the applicable Assignor such documents as such Assignor shall reasonably request to evidence such termination.
		

		
			9.11      Discretion of the Assignee.  Notwithstanding anything else to the contrary herein, the Assignee shall not have any duty to take any discretionary action or exercise any discretionary powers; provided, however, that if, the taking or exercise of any such discretionary action could reasonably be expected to expose the Assignee to any loss, liability or expense, the Assignee shall have received, upon request therefor, from the Holders indemnity or security (or both) satisfactory to it against such loss, liability or expense that might be incurred in connection therewith.  Whenever reference is made herein to any discretionary action by, consent, designation, specification, requirement or approval of, notice, request or other communication from, or other direction given or action to be undertaken or to be (or not to be) suffered or omitted by the Assignee or to any election, decision, opinion, acceptance, use of judgment, expression of satisfaction or other exercise of discretion, rights or remedies to be made (or not to be made) by the Assignee, it is understood that in all cases the Assignee shall have no duty and shall be fully justified in failing or refusing to take any such action unless it shall have received written instructions from the Holders of at least a majority in principal amount of the Outstanding Securities.
		

		
			9.12      Governing Law, Jurisdiction and Waivers.
		

		
			(a)         THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS ASSIGNMENT SHALL BE BROUGHT IN ACCORDANCE WITH SECTION 1.04 OF THE INDENTURE. EACH ASSIGNOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS AND SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS DESCRIBED IN SECTION 1.04 OF THE INDENTURE.
		

		
			
		

		
			

		 

		

			Appendix G-7

		

 

		

			 

		

		

		
			 
		

		
			(b)         EACH ASSIGNOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT OR ANY APPELLATE COURT WITH RESPECT THERETO AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT.
		

		
			(c)         EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
		

		
			9.13      Conflict.  In the event of a direct conflict between this Assignment and the Indenture, the Indenture shall control; provided,  however, the parties understand and agree that this Assignment sets forth additional covenants, obligations and rights and the parties will use all reasonable efforts to construe the provisions and covenants in this Assignment as not being in direct conflict with the Indenture.
		

		
			9.14      Limitation.
		

		
			(a)         The obligations of OpCo under this Assignment will be limited, subject to clause (b) below, by mandatory provisions of law applicable to OpCo limiting the legal capacity or ability of OpCo to provide security under this Assignment (including, but not limited to, the provisions of Sections 8-7 and 8-10, cf. 1-3 and 1-4 of the Norwegian Limited Liability Companies Act of 1997), regulating unlawful financial assistance and other prohibited loans, guarantees and joint and several liability as well as providing of security.
		

		
			(b)         If any limitation is no longer applicable as a mandatory provision under Norwegian law, that limitation will no longer apply to the security provided by OpCo under this Assignment.
		

		
			[Signature page follows]
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-8

		

 

		

			 

		

		

		
			IN WITNESS WHEREOF, each Assignor has caused this Assignment to be executed and delivered as of the day and year first above written.
		

			
					
						 

					
					
						TRANSOCEAN [ENABLER/ENCOURAGE]
LIMTED, as an Assignor

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						TRANSOCEAN INC., as an Assignor

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						SONGA OFFSHORE RIG 3 AS, as an Assignor

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-9

		

 

		

			 

		

		

		
			Acknowledged and Agreed to on the day and year first above written:
		

			
					
						 

					
					
						WELLS FARGO BANK, NATIONAL

				
	
					
						 

					
					
						ASSOCIATION, as the Collateral Agent, as the Assignee

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			Appendix G-10

		

 

		

			 

		

		

		
			EXHIBIT 1
		

		
			FORM OF LOSS PAYABLE CLAUSE
		

		
			Hull and Machinery (Marine and War Risks)
		

		
			Loss with respect to Norwegian registered drillship Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”), if any, shall be payable to the order of Wells Fargo Bank, National Association, as the Collateral Agent for itself and certain other Secured Creditors (in such capacity, together with its successors and assigns in such capacity, the “Collateral Agent”) to such account and/or bank as the Collateral Agent may notify to the insurer from time to time in writing; provided, that if there has been any such loss that results in Insurance Proceeds of U.S. $25,000,000 or less, such proceeds will be made as designated by Transocean [Enabler/Encourage] Limited, a Cayman Islands exempted company by limited shares (the “Owner”), to either the Owner, Transocean Inc., a Cayman Islands exempted company (“TINC”), or Songa Offshore Rig 3 AS, a Norwegian private limited liability company (the “Operator”).
		

		
			A payment to the Collateral Agent in accordance with this loss payable clause, to the extent of that payment, shall discharge the liability of the insurer to pay the Owner, TINC, the Operator or any other claimant insured party.
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix G-11

		

 

		

			 

		

		

		
			EXHIBIT 2
		

		
			FORM OF NOTICE OF ASSIGNMENT OF INSURANCE PROCEEDS
		

		
			TO:
		

		
			TAKE NOTICE:
		

		
			(a)         that by an Assignment of Insurances dated as of July 13, 2018 (as amended, restated, amended and restated, supplemented or otherwise modified to date, the “Assignment of Insurances”) made SONGA OFFSHORE RIG 3 AS, a Norwegian private limited liability company, TRANSOCEAN INC., a Cayman Islands exempted company, and TRANSOCEAN ENABLER LIMITED, a Cayman Islands exempted company (collectively, the “Assignors”, “we” or “us”), to WELLS FARGO BANK, NATIONAL ASSOCIATION, as the collateral agent (the “Collateral Agent”) for the Secured Creditors (as defined in the Indenture referred to in the Assignment of Insurances) (in such capacity, together with its successors and assigns in such capacity, the “Assignee”), a copy of which is attached hereto, we have assigned to the Assignee, inter alia, all our right, title and interest in, to and under all Insurances from time to time taken out by or on behalf of the Assignors taken out with yourselves in respect of the Norwegian flag vessel Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”), all Insurance Proceeds and all proceeds of the foregoing, other than returns of premium not related to physical damage to the Collateral Rig.  Capitalized terms used and not defined herein shall have the meaning ascribed to such terms in the Assignment of Insurances;
		

		
			(b)         that you are hereby irrevocably authorized and instructed to pay as from the date hereof all payments under all Insurances in accordance with the loss payable clause attached hereto as Exhibit 1 of the Assignment of Insurances; and
		

		
			(c)         that you are hereby requested and instructed to endorse the assignment, notice of which is given to you herein, on all policies or entries in respect of the Insurances.
		

		
			DATED:
		

		
			[Signature Page Follows]
		

		
			 
		

		
			
		

		
			

		 

		

			12

		

 

		

			 

		

		

		
			 
		

			
					
						 

					
					
						TRANSOCEAN [ENABLER/ENCOURAGE]
LIMITED

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Title:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						TRANSOCEAN INC.

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Title:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						SONGA OFFSHORE RIG 3 AS

				
	
					
						 

					
					
						    

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			13

		

 

		

			 

		

		

		
			Amount
		

		
			 
		

		
			USD 1,500,000,000
		

		
			 
		

		
			APPENDIX H
		

		
			FORM OF COLLATERAL RIG MORTGAGE
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix H-1

		

 

		

			 

		

		

		
			Amount
		

		
			 
		

		
			USD 1,500,000,000
		

		
			 
		

		
			FORM OF SHIP MORTGAGE DEED
		

		
			 
		

			
					
						 

					
						th Floor

					
						 

					
						 

					
						 

					
					
						 

					
						 

				
	
					
						Name of debtor

					
						Transocean [Enabler/Encourage] Limited

					
						70 Harbour Drive, 4th Floor

					
						Grand Cayman KY1-1003

					
						Cayman Islands

					
					
						Id-code of person/company

					
						[338045/338042]

				

		
			 
		

		
			HEREBY ACKNOWLEDGE(S) TO BE INDEBTED TO
		

			
					
						Mortgagee/Creditor

					
						Wells Fargo Bank, National Association

					
						 

					
					
						Id-code of person/enterprise

					
						 

				
	
					
						Amount

					
						USD 1,500,000,000

					
						 

					
					
						Amount in words

					
						USD One Billion Five Hundred Million 0/00

				

		
			 
		

		
			The principal (the amount) is to carry interest from the day of disbursement.
		

		
			Reference is made to a certain indenture, dated as of July 13, 2018 (as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time), entered into among Transocean Guardian Limited, a Cayman Islands exempted company, as the issuer, the other Guarantors listed therein and Wells Fargo Bank, National Association as trustee and collateral agent (the “Indenture”).
		

		
			 
		

		
			Rate of interest: As set out in the Indenture.
		

		
			Payment is to be carried out: In accordance with the Indenture.
		

		
			Calculation and payment of principal, interest and all other sums due to be carried out in accordance with the terms of the Indenture and the other Note Documents.
		

		
			 
		

		
			As security for payment, discharge and performance of the Notes Obligations (as defined in the Indenture).
		

		
			 
		

		
			under the following conditions,
		

		
			 
		

		
			I/WE HEREBY MORTGAGE
		

			
					
						Name of the ship:

					
						 

					
					
						Songa [Enabler/Encourage] 

				
	
					
						Signal letters:

					
						 

					
					
						[LEWU/LEWZ]    

					
					
						entered in the 

					
					
						Norwegian Ordinary

					
					
						Register of ships.

				
	
					
						Built in the year:

					
						 

					
					
						[2016/2015]

					
					
						Home port:  

					
					
						Stavanger

				
	
					
						The Mortgage comprises the ship’s various parts and appurtenances of whatever kind including future acquisitions, cf. the Maritime Act (Norway) Section 45.

					
						 

					
						If the ship has been entered in the Shipbuilding Register, this mortgage also comprises the main engines and major sections of the hull whether or not they are being built outside the principal builder's yard. It is the responsibility of the debtor to provide for the necessary marking or other identification of materials and equipment in the possession of the principal builder's yard, or in the possession of other builders who are building the main engines or major sections of the hull, cf the Maritime Act (Norway) Section 43.

					
						 

					
						The mortgage also comprises all insurance sums for the ship. 

				

		
			 
		

			
					
						This mortgage has right of succession as and when claims of equal or prior rank are paid off or redeemed, and at present this mortgage ranks with first priority.

				

		
			
		

		
			

		 

		

			 

		

			

					

						DATE

					

					

						SIGNATURES

					

					

						 

				
	

					

						 

					

					

						 

					

					

						PAGE 1 OF 4

				
	

					

						 

					

					

						Transocean [Enabler/Encourage] Limited

					

					

						 

				

		

			 

		

 

		

			 

		

		

		
			Amount
		

		
			 
		

		
			USD 1,500,000,000
		

		
			 
		

			
					
						The mortgaged ship shall not be sold or further encumbered without the consent of the mortgagee.

				

		
			 
		

		
			In addition to disposing of the mortgaged ship by forced sale or by taking possession of the ship, the repayment of the debt (including the Notes Obligations (as defined in the Indenture) together with interest and all costs and expenses incurred may be enforced without prior legal proceedings, according to the Enforcement Act (Norway) section 7-2.
		

		
			 
		

		
			Furthermore, the mortgage is subject to the provisions of the Indenture [and a Ship Mortgage Declaration made by [•] as mortgagor dated [•] as security for the Notes Obligations and] the following:
		

		
			 
		

		
			CONDITIONS
		

		
			Clause 1
		

		
			 
		

		
			Without the written consent of the creditor the mortgaged ship shall not be chartered for a continuous period exceeding 12 months or on bareboat terms.
		

		
			The creditors consent in writing shall be obtained in advance if it is intended to break up the mortgaged ship, to alter its nature or to incur major costs on it.
		

		
			The mortgaged ship shall not be employed in defiance of current laws, rules, international conventions or insurance terms which have been accepted by the creditor.
		

		
			 
		

		
			Clause 2
		

		
			 
		

		
			The debtor undertakes to take out such insurances as required at any time by the creditor.
		

		
			Hull and risk insurances shall cover full value, on full terms.
		

		
			Other insurances shall cover the amounts customary for the type of ship concerned and shall comprise those risks which it is customary to cover in connection with the use of the mortgaged ship and its trading area or as the creditor deems necessary to protect his interests as mortgagee.
		

		
			The insurance terms, choice of currency, brokers and the underwriters covering the insurances are subject to the approval of the creditor.
		

		
			The debtor shall ensure that the creditor receives insurance documents which contain the insurance terms and which confirm that the creditor’s interests as mortgagee are co-insured or noted. Notation or assignment of the insurances shall be effected in the manner required by the creditor.
		

		
			If the debtor does not fulfil his obligation to insure, the creditor has the right to cover the insurances for the debtor’s account.
		

		
			 
		

		
			Clause 3
		

		
			In the event of any salvage claim or if anyone takes legal steps to obtain any right in or disposal of the mortgaged ship, the debtor shall promptly notify the creditor thereof. The same applies in the event of major damage or capture or if for any other reason the debtor’s control of the mortgaged ship is lost or restricted, or if he resolves to lay up the mortgaged ship.
		

		
			The debtor shall send to the creditor, undemanded, the annual financial statement, annual report and auditor’s report as soon as they are available.
		

		
			 
		

		
			Clause 4
		

		
			 
		

		
			The creditor or his representative may at any time inspect the ship and have it valued for the debtor’s account.
		

		
			If renewed valuation of the mortgaged ship indicates in the judgement of the creditor that the security has diminished substantially, the creditor may require extraordinary repayment of the debt.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						DATE

					

					

						SIGNATURES

					

					

						 

				
	

					

						 

					

					

						 

					

					

						PAGE 2 OF 4

				
	

					

						 

					

					

						Transocean [Enabler/Encourage] Limited

					

					

						 

				

		

			 

		

 

		

			 

		

		

		
			Amount
		

		
			 
		

		
			USD 1,500,000,000
		

		
			 
		

		
			Clause 5
		

		
			 
		

		
			The debt is deemed to have fallen due by default if:
		

		
			a)    the debtor substantially defaults on his obligations under this ship mortgage deed.
		

		
			b)    the debtor has given the creditor incorrect information.
		

		
			c)    the debtor, the guarantor or the owner of the mortgaged ship dies, suspends payment, seeks composition or other debt settlements, is declared bankrupt or is subject to enforcement proceedings.
		

		
			d)    the management of the mortgaged ship is changed or there is any partial or complete change in the equity interests of the ship through the assignment of stocks, shares of otherwise.
		

		
			e)    the mortgaged ship is lost or broken up.
		

		
			f)     the security is substantially diminished as a consequence of damage to the mortgaged ship.
		

		
			g)    the mortgaged ship loses its nationality.
		

		
			h)    the mortgaged ship is subject to temporary enforcement proceedings or there is taken possession of the mortgaged ship, or it is seized, requisitioned, captured or if the debtor for any other reason wholly or partially loses control of the mortgaged ship.
		

		
			i)     the mortgaged ship is sold by forced sale, is encumbered by any distraint, or if any claim secured by maritime lien is not paid when due.
		

		
			 
		

		
			In the event of such default the creditor may require the whole debt to be paid immediately without any notice.
		

		
			 
		

		
			Clause 6
		

		
			 
		

		
			In the event of default the creditor may require the debtor promptly to bring the mortgaged ship to any port designated by the creditor or may take possession of the mortgaged ship and bring it to any port he may find expedient, at the debtor’s expense and risk.
		

		
			 
		

		
			Clause 7
		

		
			 
		

		
			For any legal proceedings the undersigned and subsequent owners of the mortgaged ship accept and irrevocably submits to:
		

		
			 
		

		
			Oslo district court (Oslo tingrett)
		

		
			Clause 8
		

		
			 
		

		
			The debtor shall pay all costs and expenses arising in connection with the loan.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						DATE

					

					

						SIGNATURES

					

					

						 

				
	

					

						 

					

					

						 

					

					

						PAGE 3 OF 4

				
	

					

						 

					

					

						Transocean [Enabler/Encourage] Limited

					

					

						 

				

		

			 

		

 

		

			 

		

		

		
			Amount
		

		
			 
		

		
			USD 1,500,000,000
		

		
			 
		

			
					
						 

					
					
						 

					
						 

				
	
					
						 

					
						Place, date

					
						________________, __________

					
						 

				
	
					
						Signature of debtor

					
					
						Repeated in type or block letters

					
						 

				
	
					
						 

					
					
						Transocean  [Enabler/Encourage] Limited

				

		
			 
		

		
			I/We confirm that the signer(s) being over 18 years of age, has/have signed this document or acknowledged his/their signature(s) hereto in my/our presence.  I am/We are of age and resident in Norway.
		

		
			 
		

			
					
						1st signature

					
					
						Repeated in type or block letters

				
	
					
						 

					
					
						 

				
	
					
						Address (typed or in block letters)

					
						 

					
						 

				
	
					
						2nd signature

					
					
						Repeated in type or block letters

				
	
					
						 

					
					
						 

				
	
					
						Address (typed or in block letters)

					
						 

					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

			

					

						DATE

					

					

						SIGNATURES

					

					

						 

				
	

					

						 

					

					

						 

					

					

						PAGE 4 OF 4

				
	

					

						 

					

					

						Transocean [Enabler/Encourage] Limited

					

					

						 

				

		

			 

		

 

		

			 

		

		

		
			APPENDIX I
		

		
			FORM OF ASSIGNMENT OF BAREBOAT CHARTER
		

		
			
		

		
			

		 

		

			Annex I-1

		

 

		

			 

		

		

		
			FORM OF
		

		
			ASSIGNMENT OF BAREBOAT CHARTER
		

		
			SONGA [ENABLER/ENCOURAGE]
		

		
			By this Assignment of Bareboat Charter, dated as of July 13, 2018 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Assignment”), the undersigned TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED, a Cayman Islands exempted company by limited shares (the “Assignor”), in consideration of One Dollar ($1.00) lawful money of the United States of America and other good and valuable consideration, the receipt of which is hereby acknowledged, has collaterally assigned, transferred and set over, and does hereby collaterally assign, transfer and set over unto WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral agent (in such capacity, the “Collateral Agent”) for the Secured Creditors (as defined in the Indenture referred to below) (together with its successors and assigns in such capacity, the “Assignee”), in accordance with the terms of that certain Indenture, dated as of the date hereof (as amended, restated, amended and restated, supplemented, refinanced, replaced or otherwise modified from time to time, the “Indenture”), by and among Transocean Guardian Limited, a Cayman Islands exempted company (together with its successors and permitted assigns, the “Company”), as issuer, the Guarantors party thereto from time to time (including the Assignor) and Wells Fargo Bank, National Association, as trustee and as Collateral Agent, as security for all of the Assignor’s Guaranteed Obligations (as defined in the Indenture), and unto the Assignee’s successors and assigns, to its and its successors’ and assigns’ own proper use and benefit, and does hereby grant to the Assignee a security interest in all the right, title interest, claim and demand of the Assignor in and to:
		

		
			(i)         that certain Bareboat Charter, dated November 13, 2014 (as amended, restated, supplemental, replaced, assigned or otherwise modified from time to time, the “Charter”) between Assignor and Songa Offshore Rig 3 AS, a Norwegian private limited liability company with respect to the Assignor’s Norwegian flag vessel Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ] (the “Collateral Rig”), including, without limitation, within such assignment, the right to receive all moneys due and to become due to the Assignor under the Charter and all rights arising out of the owner’s lien on cargoes and subfreights thereunder, all claims for damages arising out of the breach by the Charterer thereof and the right of the Assignor to terminate the Charter in accordance with the terms thereof, to perform thereunder and to compel performance of the terms thereof;
		

		
			(ii)       all moneys and claims for moneys due and to become due to the Assignor, and all claims for damages arising out of the Charter; and
		

		
			(iii)      any proceeds of any of the foregoing.
		

		
			Capitalized terms used herein and not otherwise defined are used herein as defined in the Indenture.
		

		
			For purposes of this Assignment, “Bareboat Account” means any Bareboat Account (as defined in the Indenture) in respect of the Collateral Rig pledged by the Assignor pursuant to the Note Documents.
		

		
			It is expressly agreed that anything herein contained to the contrary notwithstanding, (i) the Assignor shall remain liable under the Charter to perform all the obligations assumed by it thereunder, (ii) if an Event of Default shall have occurred and be continuing, the obligations of the Assignor under the Charter may be performed by the Assignee or its nominee or other assignee from the Assignee without
		

		
			
		

		
			

		 

		

			Annex I-2

		

 

		

			 

		

		

		
			releasing the Assignor therefrom, and (iii) the Assignee shall have no obligation or liability under the Charter by reason of, or arising out of, this Assignment and shall not be obligated to perform any of the obligations of the Assignor under the Charter, or to make any payment or any inquiry of the sufficiency of any payment received by it, or to present or file any claim or to take any other action to collect or enforce any payment assigned hereunder. The Assignor shall not amend or terminate the Charter except in accordance with Section 4.26(b) of the Indenture.
		

		
			The Assignor does hereby constitute the Assignee as the Assignor’s true and lawful attorney-in-fact, irrevocably, with full power (in the name of the Assignor or otherwise) to ask, require, demand, receive, compound and give acquittance for any and all moneys and claims for money due and to become due under, or arising out of, the Charter or otherwise assigned hereunder, to endorse any checks or other instruments or orders in connection therewith and to file any claims or take any action or institute any proceedings in connection therewith. The Assignee agrees not to take any action permitted in the preceding sentence unless an Event of Default shall have occurred and be continuing.  The parties agree that the grant of the power of attorney set forth in this paragraph shall not be deemed to create an obligation on the part of the Assignee to take any one or more of the actions described herein.
		

		
			Notwithstanding anything to the contrary, so long as no Event of Default shall have occurred and be continuing, the Assignor shall be entitled to receive into the Bareboat Account and retain therein any and all moneys otherwise assigned hereunder as set forth in the Indenture.  If an Event of Default shall have occurred and be continuing, at the request of the Assignee, the Assignor shall specifically authorize and direct the Charterer or other obligor to make payment of all of the moneys hereby assigned directly to the Assignee in accordance with instructions of the Assignee, and shall deliver to the Assignee the written acknowledgement of the Charterer or obligor of such instructions.
		

		
			The Assignor hereby irrevocably authorizes the Assignee, at such Assignor’s expense, to file, at any time and from time to time, such financing and continuation statements or papers of similar purpose or effect relating to this Assignment, without such Assignor’s signature, as the Assignee at its option may deem appropriate, and hereby appoints the Assignee as such Assignor’s attorney-in-fact to execute any such statement in such Assignor’s name and to perform all other acts which the Assignee or its legal counsel may deem appropriate to perfect and continue the security interests conferred hereby; provided,  however, such right and assignment of power shall not constitute a duty of the Assignee, and the Assignor shall have the duty to file all necessary financing and continuation statements to perfect the security interest granted herein.
		

		
			The Assignor does hereby represent and warrant that, to the best of its knowledge, the Charterer has no claims against the Assignor under the Charter as of the date hereof.  The Assignor does hereby further represent and warrant that there is not now in effect any assignment or pledge of, and hereby covenants that the Assignor will not, so long as this instrument of Assignment shall remain in effect, assign, pledge, or suffer to exist any lien, charge, security interest, or encumbrances, or any other type of preferential arrangement, upon or with respect to the whole or any part of the rights hereby assigned, to anyone other than the Assignee, its successors or assigns, other than any Permitted Collateral Lien.
		

		
			Upon (i) the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture and subject to the satisfaction of any conditions precedent set forth therein, (ii) consent of the requisite Holders in accordance with Sections 10.02 and 2.02(f) of the Indenture, or (iii) (x) the replacement of Assignor as the “Collateral Rig Owner” with respect to the Collateral Rig or the replacement of the Collateral Rig, in each case in accordance with (a) a Fundamental Change of the Assignor not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 or 4.29 of the Indenture, as applicable, and (y) the entry into a new Assignment of Bareboat Charter by any replacement Collateral Rig Owner as required by the Indenture, the collateral assignment and continuing security interest granted
		

		
			
		

		
			

		 

		

			Annex I-3

		

 

		

			 

		

		

		
			hereby shall automatically terminate and be released and all rights to the Charter and any other rights assigned to the Assignee hereunder shall automatically revert to the Assignor.  Upon any such termination, the Assignee will, at the Assignor’s sole expense, execute and deliver to the Assignor such documents as the Assignor shall reasonably request to evidence such termination.
		

		
			All notices, requests, demands or other communications pursuant hereto shall be given in accordance with Section 14.01 of the Indenture.  Notices shall be deemed to have been given as set forth in Section 14.01 of the Indenture.  All notices and other communications shall be in writing and addressed to such party as provided in the Indenture or in any case at such other address as such party may hereafter notify the other party hereto in writing.
		

		
			Notwithstanding anything else to the contrary herein, the Assignee shall not have any duty to take any discretionary action or exercise any discretionary powers; provided,  however, that if the taking or exercise of any such discretionary action could reasonably be expected to expose the Assignee to any loss, liability or expense, the Assignee shall have received, upon request therefor, indemnity or security (or both) satisfactory to it against such loss, liability or expense that might be incurred in connection therewith.  Whenever reference is made herein to any discretionary action by, consent, designation, specification, requirement or approval of, notice, request or other communication from, or other direction given or action to be undertaken or to be (or not to be) suffered or omitted by the Assignee or to any election, decision, opinion, acceptance, use of judgment, expression of satisfaction or other exercise of discretion, rights or remedies to be made (or not to be made) by the Assignee, it is understood that in all cases the Assignee shall have no duty and shall be fully justified in failing or refusing to take any such action hereunder unless it shall have received written instructions from the Holders of at least a majority in principal amount of the Outstanding Securities in accordance with the Indenture.
		

		
			THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.  ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS ASSIGNMENT SHALL BE BROUGHT IN ACCORDANCE WITH SECTION 1.04 OF THE INDENTURE. THE ASSIGNOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS AND SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS DESCRIBED IN SECTION 1.04 OF THE INDENTURE.
		

		
			THE ASSIGNOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT OR ANY APPELLATE COURT WITH RESPECT THERETO AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT.
		

		
			EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
		

		
			Invalidity, unenforceability, or invalidation of any one or more of the provisions of this Assignment for any reason shall in no way affect any other provisions hereof, which other provisions shall remain in full force and effect.
		

		
			This Assignment, the other Note Documents and the documents herein and therein mentioned contain, or expressly incorporate, the entire agreement of the parties with respect to the subject matter
		

		
			
		

		
			

		 

		

			Annex I-4

		

 

		

			 

		

		

		
			hereof. This Assignment may not be altered or amended except by an agreement in writing signed by the Assignee and the Assignor in accordance with Article 10 of the Indenture.
		

		
			This Assignment and the Agreement and Consent to Assignment attached hereto as Exhibit A may be executed by the Assignee, the Assignor and the Charterer in separate counterparts without in any way adversely affecting the validity of said Agreement and Consent to Assignment.  Delivery of an executed copy of this Assignment or the Agreement and Consent to Assignment attached hereto as Exhibit A by facsimile or electronic transmission shall be deemed as effective as delivery of an originally executed copy.
		

		
			In the event of a direct conflict between this Assignment and the Indenture, the Indenture shall control; provided,  however, the parties understand and agree that this Assignment sets forth additional covenants, obligations and rights and the parties will use all reasonable efforts to construe the provisions and covenants in this Assignment as not being in direct conflict with the Indenture.
		

		
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			Annex I-5

		

 

		

			 

		

		

		
			IN WITNESS WHEREOF, the Assignor has caused this instrument of Assignment to be duly executed as of the day and year first above written.
		

			
					
						 

					
					
						TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED, as the Assignor

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

				
	
					
						 

					
					
						Name:

				
	
					
						 

					
					
						Title:

				

		
			 
		

		
			
		

		
			

		 

		

			[Signature Page to Assignment of Bareboat Charter]

		

 

		

			 

		

		

		
			The terms and conditions of this Assignment are hereby
		

		
			ACCEPTED BY:
		

			
					
						WELLS FARGO BANK, NATIONAL ASSOCIATION,
as the Collateral Agent, as the Assignee

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						By:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			[Signature Page to Assignment of Bareboat Charter]

		

 

		

			 

		

		

		
			Exhibit A
		

		
			FORM OF NOTICE OF ASSIGNMENT OF BAREBOAT CHARTER
		

		
			and
		

		
			FORM OF AGREEMENT AND CONSENT TO ASSIGNMENT
		

		
			Dated: [_____]
		

		
			To:  Songa Offshore Rig 3 AS
		

		
			Re: Songa [Enabler/Encourage]
		

		
			We refer to the Bareboat Charter, dated November 13, 2014 (as amended, restated, supplemental, replaced, assigned or otherwise modified from time to time, the “Charter”)  by which we agree to let, and you agree to take on charter the Norwegian flag vessel Songa [Enabler/Encourage], IMO No. [8772087/8772075], Flag ID [LEWU/LEWZ] (the “Collateral Rig”) for the period and on the terms and conditions set out in the Charter.]
		

		
			We hereby give you notice of the following, and you by your execution and delivery of this Agreement and Consent to Assignment (this “Consent”) hereby agree to the following:
		

		
			1.         By an Assignment of Bareboat Charter (the “Assignment”, the defined terms therein being used herein and not otherwise defined shall be used herein as therein defined), dated as of July 13, 2018, (a copy of which is attached hereto) made between us and the Assignee referred to therein, we have collaterally assigned, transferred and set over unto the Assignee all our right, title and interest in and to (but not any of our obligations or liabilities under) the Charter and in and to moneys and claims for moneys due and to become due to us under the Charter (all as more fully described in the Assignment).
		

		
			2.         You are hereby irrevocably authorized and instructed to make all payments due by you in accordance with the terms of the Charter to: [insert Bareboat Account instructions].
		

		
			3.         Upon your receipt of written notice of the occurrence of an Event of Default, from the Assignee, you are hereby irrevocably authorized and instructed to pay, and agree that you will make payment of all such moneys payable by you under the Charter to such place as the Assignee may from time to time direct.
		

		
			4.        We shall remain liable to perform all our obligations under the Charter and the Assignee shall not be under any obligation under the Charter, but should the Assignee exercise its right to perform, or cause performance by its nominee or designee of, our obligations under the Charter, you agree, without thereby releasing us from our obligations under the Charter, to accept such performance.
		

		
			
		

		
			

		 

		

			Appendix I-8

		

 

		

			 

		

		

		
			5.         You consent to the Assignment, and agree that you will make payment of all moneys due and to become due under the Charter, without setoff or deduction for any claim not arising under the Charter, direct to the account set forth in paragraph 2 hereof, and otherwise if the Assignee has given you a written notice of the occurrence of an Event of Default, to such account from time to time specified by the Assignee at such address as the Assignee shall from time to time request the undersigned in writing, in each case until receipt of written notice from the Assignee that all obligations of the Assignor to it have been paid in full. You agree that you shall not seek the recovery of any payment actually made by you to the Assignee pursuant to this Charterer’s Consent once such payment has been made. You hereby waive the right to assert against the Assignee, as assignee of the Assignor, any claim, defense, counterclaim or setoff other than a claim, defense, counterclaim or setoff that you could assert against the Assignor under the Charter. These provisions shall not be construed to relieve the Assignor of any liability to the Charterer.
		

		
			6.         You agree that if the Assignee gives you written notice that an Event of Default has occurred and is continuing, the Assignee shall be entitled to exercise any and all rights and remedies of the Assignor under the Charter in accordance with the terms of the Assignment, and you shall comply in all respects with such exercise.
		

		
			7.         You agree that you will not, until the termination of the Assignment, acknowledge and consent to any other assignment by us of any of the whole or any part of our right, title and interest in and to the Charter and in and to moneys and claims for moneys due and to become due to us under the Charter without the written consent of the Assignee.
		

		
			8.         You may rely on any written notice given by the Assignee to you as being properly given under the terms of the Assignment and this Consent, even if we notify you that such written notice is not validly given.
		

		
			9.         You covenant and agree with the Assignee that you will clearly record on your books and records notations of the Assignment.
		

		
			10.       Your acknowledgement and consent hereunder, and your agreements herein contained, are for the benefit of the Assignee and shall be enforceable by the Assignee.
		

		
			11.       This Consent shall terminate, and be of no further force and effect, at the earlier of the termination of (i) the Assignment or (ii) the Charter.
		

		
			The authorizations and instructions by us in this Consent cannot be revoked or varied by us without the Assignee’s prior written consent.
		

		
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			Appendix I-9

		

 

		

			 

		

		

		
			For and on behalf of
		

			
					
						TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						By:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			Dated:
		

		
			
		

		
			

		 

		

			Appendix I-10

		

 

		

			 

		

		

		
			Dated:  [_____]
		

		
			To: TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED, as the Assignor
		

		
			To: WELLS FARGO BANK, NATIONAL ASSOCIATION, as the Collateral Agent and as the Assignee
		

		
			In consideration of the Charter, and for other good and valuable consideration, the receipt of which is hereby acknowledged, we hereby agree to the terms set out above and hereby consent to, and agree to be bound by, the Agreement and Consent to Assignment attached hereto (capitalized terms used herein have the meanings given such terms in such Agreement and Consent to Assignment).
		

		
			For the benefit of the Assignee, until the security interest granted under the Assignment is terminated in accordance with the terms thereof, the Charterer subordinates any lien that it may have on the Collateral Rig, howsoever and whensoever arising, and irrevocably agrees that any claim against the Collateral Rig that the Charterer may or could have is subject and subordinate to the claims of the Assignee and the other Secured Creditors under any Note Document including, but not limited to, the Mortgagee under the Collateral Rig Mortgage (as defined below) on the Collateral Rig, provided further that the creation or enforcement by the Charterer of any maritime lien (other than Permitted Collateral Liens) on the Collateral Rig arising from or related to the Charter (or any other sub-charter or similar contract of or related to the Collateral Rig) is expressly prohibited.  “Collateral Rig Mortgage” means that certain Ship Mortgage Deed, dated July 13, 2018 by the Assignor, as Shipowner in favor of the Assignee, as Collateral Agent, as Mortgagee over the Collateral Rig, as it may be amended, restated, amended and restated, supplemented or otherwise modified from time to time.
		

		
			The undersigned confirms that the Charter has been duly assigned to it and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms.
		

		
			For and on behalf of
		

			
					
						SONGA OFFSHORE RIG 3 AS

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						By:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			

		 

		

			Appendix I-11

		

 

		

			 

		

		

		
			APPENDIX J-1
		

		
			FORM OF RECEIVABLES PLEDGE AGREEMENT
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix J-1-1

		

 

		

			 

		

		

		
			FORM OF
		

		
			RECEIVABLES PLEDGE AGREEMENT
		

		
			MADE BY
		

		
			TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED
		

		
			IN FAVOR OF
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION,
		

		
			 AS THE COLLATERAL AGENT
		

		
			DATED AS OF
		

		
			JULY 13, 2018
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			This RECEIVABLES PLEDGE AGREEMENT dated as of July 13, 2018 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, this “Agreement”), is entered into by TRANSOCEAN [ENABLER/ENCOURAGE] LIMITED, a Cayman Islands exempted company limited by shares (the “Pledgor”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, in its capacity as collateral agent (in such capacity, together with any successor collateral agent, the “Collateral Agent”) for the Secured Creditors (as such term is defined in the Indenture referred to below).
		

		
			RECITALS
		

		
			Pursuant to that certain Indenture, dated as of the date hereof (as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Indenture”), by and among Transocean Guardian Limited, a Cayman Islands exempted company (the “Company”), the Pledgor, the other Guarantors (as defined therein) party thereto from time to time and Wells Fargo Bank, National Association, as trustee (in such capacity, the “Trustee”) and Collateral Agent, the Company will issue (the “Issuance”) 5.875% Senior Secured Notes due 2024 in an aggregate principal amount of $750,000,000 (the “Securities”).
		

		
			It is a requirement of the Indenture that the Pledgor enter into this Agreement in order to grant to the Collateral Agent, for the ratable benefit of the Secured Creditors, a security interest in the Collateral (as hereinafter defined).
		

		
			The Pledgor will receive substantial, direct and indirect, benefits from the Issuance.
		

		
			NOW, THEREFORE, in consideration of the premises and the mutual agreements herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
		

		
			SECTION 1.
		

		
			Definitions
		

		
			1.1        Definitions.
		

		
			(a)         Unless otherwise defined herein, capitalized terms defined in the Indenture and used herein have the meanings given to them in the Indenture, and all terms which are defined in Article 8 or 9 of the UCC (as hereinafter defined) are used herein as so defined. The parties intend that the terms used herein which are defined in the UCC have, at all times, the broadest and most inclusive meanings possible. Accordingly, if the UCC shall in the future be amended or held by a court to define any term used herein more broadly or inclusively than the UCC in effect on the date hereof, then such term, as used herein, shall be given such broadened meaning. If the UCC shall in the future be amended or held by a court to define any term used herein more narrowly, or less inclusively, than the UCC in effect on the date hereof, such amendment or holding shall be disregarded in defining terms used herein.
		

		
			(b)         The following terms have the following meanings:
		

		
			“Bareboat Charter” shall mean any Bareboat Charter to which the Pledgor, as owner of the Collateral Rig, is a party.
		

		
			“Collateral” has the meaning assigned to such term in Section 2.01.
		

		
			“Collateral Rig” means that certain Norwegian flag vessel Songa [Enabler/Encourage], IMO No. [8772087/8772075] and Flag ID [LEWU/LEWZ].
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			“UCC” means the Uniform Commercial Code as from time to time in effect in the State of New York; provided,  however, that, in the event that, by reason of mandatory provisions of law, any of the attachment, perfection or priority of the Collateral Agent’s or any other Secured Creditor’s security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection, the effect thereof or priority and for purposes of definitions related to such provisions.
		

		
			1.2        Rules of Interpretation. Unless the context otherwise requires, (i) the term “or” is not exclusive, (ii) words in the singular include the plural, and in the plural include the singular, (iii) “will” shall be interpreted to express a command, (iv) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (v) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, and (vi) all references herein to Articles and Sections shall be construed to refer to Articles and Sections of this Agreement unless otherwise stated.
		

		
			SECTION 2.
		

		
			Grant of Security Interest
		

		
			2.1        Grant of Security Interest. The Pledgor hereby pledges, collaterally assigns and transfers to the Collateral Agent, and hereby grants to the Collateral Agent, for the ratable benefit of the Secured Creditors, a continuing security interest in and to all of the Pledgor’s right, title and interest in and to all of the following personal property, whether now owned or existing or hereafter acquired or arising and regardless of where located (the “Collateral”), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Notes Obligations, whether now existing or hereafter incurred or arising:
		

		
			(i)         (A) all dividends, other similar payments and distributions received from the Collateral Rig Operator and (B) all earnings, hires, freights, income and other sums received by the Pledgor under the Bareboat Charter or otherwise derived from the Bareboat Charter;
		

		
			(ii)        all intercompany Indebtedness from time to time owed to the Pledgor by Holdings or any Subsidiary thereof (all such indebtedness being the “Pledged Receivables”);
		

		
			(iii)       any interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the foregoing; and
		

		
			(iv)       to the extent not otherwise described above, all Proceeds, products, accessions, rents and profits of, or in respect of, any and all of the foregoing.
		

		
			2.2        Pledgor Remains Liable. Notwithstanding anything to the contrary contained herein, (i) the Pledgor shall remain liable for all obligations under and in respect of the Collateral and nothing contained herein is intended or shall be a delegation of duties to the Collateral Agent or any other Secured Creditor, (ii) the Pledgor shall remain liable under each of the agreements included in the Collateral, to perform all of the obligations undertaken by it thereunder all in accordance with and pursuant to the terms and provisions thereof, and neither the Collateral Agent nor any other Secured Creditor shall have any obligation or liability under any of such agreements by reason of or arising out of this Agreement or any other document related hereto nor shall the Collateral Agent nor any other Secured Creditor have
		

		
			
		

		
			

		 

		

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			any obligation to make any inquiry as to the nature or sufficiency of any payment received by it or have any obligation to take any action to collect or enforce any rights under any agreement included in the Collateral, and (iii) the exercise by the Collateral Agent of any of its rights hereunder shall not release the Pledgor from any of its duties or obligations under the contracts and agreements included in the Collateral.
		

		
			SECTION 3.
		

		
			Representations and Warranties
		

		
			The Pledgor hereby represents and warrants to the Collateral Agent and each other Secured Creditor as follows:
		

		
			3.1        Pledgor Ownership. The Pledgor is the legal and beneficial owner of the Collateral free and clear of any security interest except for Permitted Collateral Liens and Liens that will be terminated in connection with the application of the proceeds of the Securities.
		

		
			3.2        Valid Security Interest. The pledge and collateral assignment of the Collateral pursuant to this Agreement creates a valid security interest in the Collateral, securing the Notes Obligations, and is enforceable in accordance with its terms, and, upon (x) the filing of a UCC financing statement with the District of Columbia Recorder of Deeds naming the Pledgor as “debtor” and the Collateral Agent as “secured party” and describing the Collateral and (y) the Collateral Agent taking possession or control of all Collateral with respect to which a security interest may be perfected only by possession or control, the security interests granted to the Collateral Agent hereunder constitute valid and perfected first priority security interests with respect to all of the Collateral (subject to Permitted Collateral Liens and Liens that will be terminated in connection with the application of the proceeds of the Securities).
		

		
			3.3        No Consent, Approval or Authorization. Except for any consent, authorization or approval which has been obtained or notice of filing that has been made, no consent of any other person or entity and no authorization, approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for:
		

		
			(i)          the pledge and assignment by the Pledgor of the Collateral pursuant to this Agreement, or for the execution, delivery or performance of this Agreement by the Pledgor;
		

		
			(ii)         the perfection or maintenance of the security interest created hereby (including the first priority (subject to Permitted Collateral Liens and Liens that will be terminated in connection with the application of the proceeds of the Securities) nature of such security interest), other than recordings and filings required by Section 4.01; or
		

		
			(iii)       the exercise by the Collateral Agent of its rights and remedies hereunder.
		

		
			3.4        Pledgor Information. On the date hereof, the correct legal name of the Pledgor, all names and trade names that the Pledgor has used in the last five years, the Pledgor’s jurisdiction of organization and each jurisdiction of organization of the Pledgor over the last five years and the location(s) of the Pledgor’s chief executive office or sole place of business over the last five years are specified on Schedule 3.04.
		

		
			3.5        Pledged Receivables. The Pledgor has delivered to the Collateral Agent all Instruments representing any Pledged Receivables, accompanied by duly executed instruments of transfer or assignment in blank.
		

		
			
		

		
			

		 

		

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			SECTION 4.
		

		
			Covenants
		

		
			The Pledgor covenants and agrees with the Collateral Agent, for the benefit of the Secured Creditors, that, from and after the date of this Agreement until this Agreement is terminated in accordance with Section 7.10:
		

		
			4.1        Maintenance of the Collateral; Further Assurances. The Pledgor agrees that:
		

		
			(a)         to the extent that a security interest in the Collateral may be perfected by the filing of a financing statement or, in the case of the Pledged Receivables represented by an Instrument, by possession thereof, pursuant to the UCC, the Pledgor shall maintain the security interest created by this Agreement as a perfected first priority security interest (subject to Permitted Collateral Liens) and shall defend such security interest against the claims and demands of all Persons whomsoever;
		

		
			(b)         it will furnish to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral as the Collateral Agent may reasonably request, all in reasonable detail; and
		

		
			(c)         to the extent that a security interest in the Collateral is to be perfected by a filing pursuant to the UCC, it will file any required UCC continuation statements from time to time in order to maintain the Collateral Agent’s first priority status in such security interest (subject to Permitted Collateral Liens).
		

		
			4.2        Changes in Locations, Name, Etc. Without limitation of any other covenant herein, the Pledgor will give notice to the Collateral Agent within 30 days after any change in (a) its legal name, (b) the location of its chief executive office or principal place of business, (c) its identity or corporate structure or (d) its jurisdiction of organization, and the Pledgor shall promptly take all action necessary to maintain the perfection and priority of the Collateral Agent’s security interests in the Collateral under this Agreement. In any notice furnished pursuant to this Section 4.02, the Pledgor will expressly state in a conspicuous manner that the notice is required by this Agreement and contains facts that may require additional filings of financing statements or other notices for the purposes of continuing perfection and maintaining the priority of the Collateral Agent’s security interest in the Collateral.
		

		
			4.3        Pledged Receivables.  All Instruments representing or evidencing the Pledged Receivables shall promptly be delivered to and held by the Collateral Agent pursuant hereto and shall be in suitable form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignment in blank, all in form and substance reasonably satisfactory to the Collateral Agent.
		

		
			SECTION 5.
		

		
			Remedial Provisions
		

		
			5.1        Remedies.
		

		
			If any Event of Default shall have occurred and be continuing:
		

		
			(a)         The Collateral Agent shall have the right, subject to and in accordance with the terms of the Indenture, to exercise in respect of the Collateral, in addition to other rights and remedies provided for herein or under any other Note Document or otherwise available to it at law, in equity or under any statute or other agreement, all the rights and remedies of a secured party upon default under the UCC (whether or not the UCC applies to the affected Collateral) or any other applicable law or otherwise available at law or
		

		
			
		

		
			

		 

		

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			equity and also may: (i) without notice except as specified below, sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Collateral Agent may deem commercially reasonable; and (ii) exercise any and all rights and remedies of the Pledgor under or in connection with the Collateral, or otherwise in respect of the Collateral, including, without limitation, those set forth in Section 9-607 of the UCC.  The Pledgor agrees that, to the extent notice of sale shall be required by law, at least 10 days’ notice to the Pledgor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Collateral Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. The Collateral Agent and any other Secured Creditor shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in the Pledgor, which right or equity is hereby waived and released. If applicable to any particular item of Collateral, the Pledgor further agrees, at the Collateral Agent’s request, to assemble the Collateral and make it available to the Collateral Agent at places which the Collateral Agent shall instruct, whether at the Pledgor’s premises or elsewhere. Any such sale or transfer by the Collateral Agent, either to itself or to any other Person, shall be absolutely free from any claim of right by the Pledgor, including any equity or right of redemption, stay or appraisal which the Pledgor has or may have under any rule of law, regulation or statute now existing or hereafter adopted (and the Pledgor hereby waives any rights it may have in respect thereof). Upon any such sale or transfer, the Collateral Agent shall have the right to deliver, assign and transfer to the purchaser or transferee thereof the Collateral so sold or transferred.
		

		
			(b)         Any cash held by or on behalf of the Collateral Agent and all cash proceeds received by or on behalf of the Collateral Agent in respect of any sale of, collection from, or other realization upon all or any part of the Collateral may at any time thereafter be applied in whole or in part by the Collateral Agent, for the ratable benefit of the Secured Creditors, against, all or any part of the Notes Obligations, in the manner set forth in the Indenture.
		

		
			(c)         All payments received by the Pledgor in respect of the Collateral shall be received in trust for the benefit of the Collateral Agent, shall be segregated from other funds of the Pledgor and shall be forthwith paid over to the Collateral Agent in the same form as so received (with any necessary endorsement).
		

		
			(d)         The Collateral Agent is authorized, in connection with any sale of the Collateral pursuant to this Section 5.01, to deliver or otherwise disclose to any prospective purchaser of the Collateral any information in its possession relating to such Collateral.
		

		
			(e)         The Collateral Agent may appoint any Person as agent to perform any act or acts necessary or incident to appropriate or realize upon any Collateral or to any sale or transfer of the Collateral.
		

		
			(f)         To the extent permitted by applicable law, the Pledgor hereby waives all claims, damages and demands it may acquire against the Collateral Agent arising out of the exercise by it of any rights under this Agreement, other than with respect to the Collateral Agent’s actions constituting gross negligence or willful misconduct.
		

		
			5.2        Application of Proceeds; Waiver; Deficiency. The Collateral Agent shall apply the proceeds of any collection or sale of Collateral, including any Collateral consisting of cash, as payment for the Notes Obligations in accordance with the terms of the Indenture.
		

		
			
		

		
			

		 

		

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			5.3        Non-Judicial Enforcement. The Collateral Agent may enforce its rights hereunder without prior judicial process or judicial hearing, and to the extent permitted by law, the Pledgor expressly waives any and all legal rights which might otherwise require the Collateral Agent to enforce its rights by judicial process.
		

		
			SECTION 6.
		

		
			The Collateral Agent
		

		
			6.1        Collateral Agent’s Appointment as Attorney-in-Fact, Etc.
		

		
			(a)         The Pledgor hereby irrevocably constitutes and appoints the Collateral Agent and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the Pledgor and in the name of the Pledgor, as appropriate, or in its own name, for the purpose of carrying out the terms of this Agreement, to take any and all reasonably appropriate action and to execute any and all documents and instruments which may be reasonably necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, the Pledgor hereby gives the Collateral Agent the power and right, on behalf of the Pledgor, without notice to or assent by the Pledgor, to do any or all of the following:
		

		
			(iv)      unless being disputed in accordance with the terms of the Indenture, pay or discharge taxes and liens (other than liens for taxes not yet delinquent, or which can thereafter be paid without penalty, in each case such that the lien cannot be enforced) levied or placed on or threatened against the Collateral, effect any repairs or any insurance called for by the terms of this Agreement, the Indenture or any other Note Document and pay all or any part of the premiums therefor and the costs thereof;
		

		
			(v)       execute, in connection with any sale provided for in Section 5.01, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral; and
		

		
			(vi)      (A) direct any party liable for any payment under any of the Collateral to make payment of any and all moneys due or to become due thereunder directly to the Collateral Agent (for the benefit of the Secured Creditors) or as the Collateral Agent shall direct; (B) ask or demand for, collect, and receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of or arising out of any Collateral; (C) in the name of the Pledgor, as appropriate, or its own name, or otherwise, take possession of and indorse and collect any check, draft, note, acceptance or other instrument for the payment of moneys due with respect to any Collateral and commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral or any portion thereof and to enforce any other right in respect of any Collateral; (D) defend any suit, action or proceeding brought against the Pledgor with respect to any Collateral; (E) settle, compromise or adjust any such suit, action or proceeding and, in connection therewith, give such discharges or releases as the Collateral Agent may deem appropriate; and (F) sell, transfer, pledge and make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Collateral Agent were the absolute owner thereof for all purposes, and do, at the Collateral Agent’s option and the Pledgor’s expense, at any time, or from time to time, all acts and things which the Collateral Agent deems necessary to protect,
		

		
			
		

		
			

		 

		

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			preserve or realize upon the Collateral and the Collateral Agent’s security interests therein and to effect the intent of this Agreement, all as fully and effectively as the Pledgor might do.
		

		
			Anything in this Section 6.01(a) to the contrary notwithstanding, (x) the Collateral Agent agrees that it will not exercise any rights under the power of attorney provided for in this Section 6.01(a) unless an Event of Default shall have occurred and be continuing, and (y) the parties agree that the grant of the power of attorney set forth in this Section 6.01(a) shall not be deemed to create an obligation on the part of the Collateral Agent to take any one or more of the actions described herein.
		

		
			(b)         If the Pledgor fails to perform or comply with any of its agreements contained herein within the applicable grace periods, the Collateral Agent, at its option, but without any obligation so to do, may perform or comply, or otherwise cause performance or compliance, with such agreement.
		

		
			(c)         The expenses of the Collateral Agent incurred in connection with actions undertaken as provided in and in accordance with this Section 6.01 shall constitute the Notes Obligations and shall be payable by the Pledgor to the Collateral Agent on demand.
		

		
			(d)         The Pledgor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue and in compliance hereof. All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the security interests created hereby are released as set forth in Section 7.10.
		

		
			6.2        Duty of Collateral Agent. The Collateral Agent’s sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Collateral Agent deals with similar property for its own account. Neither the Collateral Agent, any other Secured Creditor nor any of their respective agents, employees, stockholders, directors and officers shall be liable for failure to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of the Pledgor or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof. The powers conferred on the Collateral Agent hereunder are solely to protect the Collateral Agent’s and the other Secured Creditors’ interests in the Collateral and shall not impose any duty upon the Collateral Agent or any other Secured Creditor to exercise any such powers. The Collateral Agent shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its agents, employees, stockholders, directors and officers shall be responsible to the Pledgor for any act or failure to act hereunder, except for their own gross negligence or willful misconduct, as determined by a court of competent jurisdiction in a final and non–appealable decision. To the fullest extent permitted by applicable law, the Collateral Agent shall be under no duty whatsoever to make or give any presentment, notice of dishonor, protest, demand for performance, notice of non-performance, notice of intent to accelerate, notice of acceleration, or other notice or demand in connection with any Collateral or the Notes Obligations, or to take any steps necessary to preserve any rights against the Pledgor or any other Person or ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Collateral, whether or not it has or is deemed to have knowledge of such matters. The Pledgor, to the extent permitted by applicable law, waives any right of marshaling in respect of any and all Collateral, and waives any right to require the Collateral Agent or any other Secured Creditor to proceed against the Pledgor or any other Person, exhaust any Collateral or enforce any other remedy which the Collateral Agent or any other Secured Creditor now has or may hereafter have against the Pledgor and any other Person.
		

		
			
		

		
			

		 

		

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			6.3        Authority of Collateral Agent. The Pledgor acknowledges that the rights and responsibilities of the Collateral Agent under this Agreement with respect to any action taken by the Collateral Agent or the exercise or non-exercise by the Collateral Agent of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Agreement or in connection with the Notes Obligations shall, as between the Collateral Agent and the other Secured Creditors, be governed by the terms of the Indenture (including, without limitation, the rights and protections set forth therein) and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Collateral Agent and the Pledgor, the Collateral Agent shall be conclusively presumed to be acting as agent for the Secured Creditors with full and valid authority so to act or refrain from acting, and no Pledgor shall be under any obligation, or entitlement, to make any inquiry respecting such authority.
		

		
			6.4        Limitation on Duty of Collateral Agent in Respect of Collateral. Notwithstanding anything to the contrary set forth in this Agreement, the Collateral Agent shall not be responsible for filing any financing or continuation statements or recording any documents or instruments in any public office at any time or times or otherwise perfecting or maintaining the perfection of any security interest in the Collateral. The Collateral Agent shall be deemed to have exercised reasonable care in the custody of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which it accords its own property, and shall not be liable or responsible for any loss, damage or diminution in the value of any of the Collateral, by reason of the act or omission of any carrier, forwarding agency or other agent or bailee appointed by the Collateral Agent in good faith.
		

		
			Notwithstanding anything to the contrary set forth in this Agreement, the Collateral Agent shall not be responsible for the existence, genuineness or value of any of the Collateral, or for the validity, perfection, priority or enforceability of the liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on its part hereunder, for the validity or sufficiency of the Collateral or any agreement or assignment contained therein, for the validity of the title of the Pledgor to the Collateral, for insuring the Collateral or for the payment of taxes, charges, assessments or liens upon the Collateral or otherwise as to the maintenance of the Collateral. The Collateral Agent shall have no duty to ascertain, monitor, investigate or inquire as to the performance or observance of any of the terms of this Agreement by the Pledgor or any other party to such documents.
		

		
			6.5        Indemnity and Expenses.
		

		
			(a)         Without prejudice to any other rights or remedies of the Collateral Agent under any of the other Note Documents, the Pledgor agrees to indemnify, defend, protect and hold harmless the Collateral Agent (in its individual capacity and as Collateral Agent for the Secured Creditors) and each of its officers, directors and agents (each, an “Indemnified Party”) from and against any and all loss, damage, claims, liability, cost or expense (including, without limitation, the reasonable fees and expenses) incurred by any Indemnified Party, in each case in connection with this Agreement (including, without limitation, enforcement of this Agreement), except to the extent such claim, damage, loss, liability or expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from an Indemnified Party’s gross negligence or willful misconduct.
		

		
			(b)         Without prejudice to any other rights or remedies of the Collateral Agent under any of the other Note Documents, the Pledgor will, upon demand, reimburse the Collateral Agent for all reasonable out-of-pocket expenses incurred or made by it, its agents, counsel, accountants and experts (including, without limitation, the reasonable fees and expenses) in connection with (i) the transactions which give rise to this Agreement, the preparation of this Agreement and the administration of this Agreement, (ii) the custody or preservation of, use or operation of, or the sale of, collection from or other realization upon, any
		

		
			
		

		
			

		 

		

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			of the Collateral of the Pledgor, or (iii) the exercise or enforcement of any of the rights of the Collateral Agent or the other Secured Creditors hereunder.
		

		
			SECTION 7.
		

		
			Miscellaneous
		

		
			7.1        Amendments; Waivers.
		

		
			(a)         No amendment, modification or waiver of any provision of this Agreement, and no consent to any departure by the Pledgor herefrom, shall be effective unless the same is in writing and conforms to the requirements set forth in Article 10 of the Indenture.
		

		
			(b)         No failure on the part of the Collateral Agent or any other Secured Creditor to exercise, and no delay in exercising any right hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. Neither the execution nor the delivery of this Agreement shall in any manner impair or affect other security for the Notes Obligations. The rights and remedies of the Collateral Agent provided herein and in the other Note Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law or otherwise.
		

		
			7.2        Notices, etc.
		

		
			(a)         All notices, requests, demands or other communications pursuant hereto shall be given in accordance with Section 14.01 of the Indenture. Notices shall be deemed to have been given as set forth in Section 14.01 of the Indenture. All notices and other communications shall be in writing and addressed to such party as provided in the Indenture.
		

		
			7.3        Continuing Security Interest; Successors and Assigns. This Agreement shall create a continuing security interest in the Collateral and shall (a) remain in full force and effect until the termination of this Agreement in accordance with Section 7.10, (b) be binding upon the Pledgor, its successors and assigns and (c) inure, together with the rights and remedies of the Collateral Agent hereunder, to the benefit of the Secured Creditors and their respective successors, transferees and assigns.
		

		
			7.4        Survival; Reinstatement; Security Interest Absolute.
		

		
			(a)         All covenants, agreements, representations and warranties made by the Pledgor herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Note Document to which it is a party shall be considered to have been relied upon by the Collateral Agent and shall survive the execution and delivery of this Agreement, regardless of any investigation made by the Collateral Agent or on its behalf and notwithstanding that the Collateral Agent may have had notice or knowledge of any default or incorrect representation or warranty at the time any credit is extended hereunder or under any other Note Document, and shall continue in full force and effect as long as any of the Notes Obligations is outstanding and unpaid. The provisions of Section 6.05 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Notes Obligations, or the termination of this Agreement or any other Note Document or any provision hereof or thereof or the resignation or removal of the Collateral Agent in accordance with Article 12.06 of the Indenture.
		

		
			(b)         To the extent that any payments on the Notes Obligations or proceeds of any Collateral are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, debtor in possession, receiver or other Person under any bankruptcy law, common law or equitable
		

		
			
		

		
			

		 

		

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			cause, then to such extent, the Notes Obligations so satisfied shall be revived and continue as if such payment or proceeds had not been received and the Collateral Agent’s and the Secured Creditors’ liens, security interests, rights, powers and remedies under this Agreement shall continue in full force and effect. In such event, this Agreement shall be automatically reinstated and the Pledgor shall take such action as may be reasonably requested by the Collateral Agent to effect such reinstatement.
		

		
			(c)         The obligations of the Pledgor under this Agreement are independent of the Notes Obligations or any other obligations of any other pledgor under or in respect of the other Note Documents, and a separate action or actions may be brought and prosecuted against the Pledgor to enforce this Agreement, irrespective of whether any action is brought against the Pledgor or whether the Pledgor is joined in any such action or actions. All rights of the Collateral Agent and the other Secured Creditors and the pledge, assignment and security interest hereunder, and all obligations of the Pledgor hereunder, shall be irrevocable, absolute and unconditional irrespective of, and the Pledgor hereby irrevocably waives (to the maximum extent permitted by applicable law) any defenses it may now have or may hereafter acquire in any way relating to, any or all of the following:
		

		
			(vii)        any lack of validity or enforceability of any Note Document or any other agreement or instrument relating thereto;
		

		
			(viii)       any change in the time, manner or place of payment of, or in any other term of, all or any of the Notes Obligations or any other obligations of the Company or any other Note Party under or in respect of any Note Document or any other amendment or waiver of or any consent to any departure from any Note Document, including, without limitation, any increase in the Notes Obligations;
		

		
			(ix)         any taking, exchange, release or non-perfection of any Collateral or any other collateral, or any taking, release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Notes Obligations;
		

		
			(x)          any manner of application of any Collateral or any other collateral, or proceeds thereof, to all or any of the Notes Obligations, or any manner of sale or other disposition of any Collateral or any other collateral for all or any of the Notes Obligations or any other obligations of the Company or any other Note Party under or in respect of the Note Documents or any other assets of the Company or any other Note Party;
		

		
			(xi)         any change, restructuring or termination of the corporate structure or existence of the Company or any other Note Party;
		

		
			(xii)       any failure of any Secured Creditor to disclose to the Pledgor any information relating to the business, condition (financial or otherwise), operations, performance, assets, nature of assets, liabilities or prospects of the Company or any other Note Party now or hereafter known to such Secured Creditor (the Pledgor waiving any duty on the part of the Secured Creditors to disclose such information); or
		

		
			(xiii)      any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by any Secured Creditor that might otherwise constitute a defense available to, or a discharge of, the Pledgor.
		

		
			7.5        Counterparts; Integration; Effectiveness.
		

		
			
		

		
			

		 

		

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			(a)         This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall be deemed an original, but all of which when taken together shall constitute a single contract. Delivery of an executed signature page to this Agreement by facsimile or electronic transmission shall be effective as delivery of a manually signed counterpart of this Agreement.
		

		
			(b)         This Agreement and the other Note Documents to which the Pledgor is a party constitute the entire contract among the parties relating to the subject matter hereof and thereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof and thereof. This Agreement and the other Note Documents to which the Pledgor is a party represent the final agreement among the parties hereto and thereto and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties. There are no unwritten oral agreements between or among the parties.
		

		
			(c)         This Agreement shall become effective when it shall have been executed by the Collateral Agent and when the Collateral Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto.
		

		
			7.6        Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.
		

		
			7.7        Governing Law; Submission to Jurisdiction.
		

		
			(a)         THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, IN RESPECT OF ANY PARTICULAR COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT SHALL BE BROUGHT IN ACCORDANCE WITH SECTION 1.04 OF THE INDENTURE. THE PLEDGOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS AND SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS DESCRIBED IN SECTION 1.04 OF THE INDENTURE.
		

		
			(b)         THE PLEDGOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT OR ANY APPELLATE COURT WITH RESPECT THERETO AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY SUCH COURT.
		

		
			(c)         EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
		

		
			7.8        Headings. Article and Section headings used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
		

		
			
		

		
			

		 

		

			- 11  -

		

 

		

			 

		

		

		
			7.9        Acknowledgments. The Pledgor hereby acknowledges that:
		

		
			(a)         neither the Collateral Agent nor any other Secured Creditor has any fiduciary relationship with or duty to the Pledgor arising out of or in connection with this Agreement or any of the other Note Documents, and the relationship between the Company and the other Note Parties, on the one hand, and the Secured Creditors, on the other hand, in connection herewith or therewith is solely that of debtor and creditor;
		

		
			(b)         no joint venture is created hereby or by the other Note Documents or otherwise exists by virtue of the transactions contemplated hereby among the Secured Creditors or among the Pledgor and the Secured Creditors; and
		

		
			(c)         it has a duty to read this Agreement and the other Note Documents and agrees that it is charged with notice and knowledge of the terms of this Agreement and the other Note Documents; that it has in fact read this Agreement and the other Note Documents and is fully informed and has full notice and knowledge of the terms, conditions and effects thereof; that it has been represented by independent legal counsel of its choice throughout the negotiations preceding its execution of this Agreement; and has received the advice of its attorney in entering into this Agreement. Each party hereto agrees and covenants that it will not contest the validity or enforceability of any exculpatory provision on the basis that the party had no notice or knowledge of such provision or that the provision is not “conspicuous.”
		

		
			7.10      Releases, Termination. This Agreement shall automatically terminate and be released upon (i) the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture and the satisfaction of any conditions precedent set forth therein, or (ii) consent of the requisite Holders in accordance with Section 10.02 and 12.02 of the Indenture, or (iii) (x) the replacement of the Pledgor as the “Collateral Rig Owner” with respect to the Collateral Rig in accordance with (a) a Fundamental Change of the Pledgor not prohibited by Section 4.13 of the Indenture and/or (b) a transaction permitted by Section 4.27 and 4.29 of the Indenture, as applicable, and (y) the entry into a new Receivables Pledge Agreement by the replacement Collateral Rig Owner as required by the Indenture. Upon any such termination, the Collateral Agent will, at the written request of the Pledgor and at the Pledgor’s expense, execute and deliver to the Pledgor such documents as the Pledgor shall reasonably request to evidence such termination.
		

		
			7.11      Acceptance. The Pledgor expressly waives notice of acceptance of this Agreement, acceptance on the part of the Secured Creditors being conclusively presumed by their request for this Agreement and delivery of the same to the Collateral Agent.
		

		
			7.12      General Limitation of Liability. In no event shall the Collateral Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Collateral Agent shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
		

		
			In no event shall the Collateral Agent be responsible or liable for special, indirect, or consequential loss, lost profits or damage of any kind whatsoever (including, but not limited to, loss of profit and diminution in the value thereof) irrespective of whether the Collateral Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.
		

		
			
		

		
			

		 

		

			- 12  -

		

 

		

			 

		

		

		
			No provision of this Agreement shall require the Collateral Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
		

		
			7.13      Resignation or Removal of Collateral Agent. If the Collateral Agent resigns or is removed in accordance with the Indenture, such retiring Collateral Agent shall cease to be a party to this Agreement and all obligations imposed upon such retiring Collateral Agent pursuant to this Agreement shall be terminated as to such retiring Collateral Agent and deemed to be imposed upon the successor Collateral Agent appointed pursuant to the terms of the Indenture, provided, however, the retiring Collateral Agent’s indemnification rights contained in this Agreement, the Indenture or otherwise shall continue in favor of the retiring Collateral Agent.
		

		
			7.14      U.S.A. Patriot Act. The Pledgor acknowledges that in order to help the United States government fight the funding of terrorism and money laundering activities, pursuant to Federal regulations that became effective on October 1, 2003 (Section 326 of the USA PATRIOT Act), all financial institutions are required to obtain, verify, record and update information that identifies each person establishing a relationship or opening an account. The Pledgor agrees that it will provide to the Collateral Agent such information as it may request, from time to time, in order for the Collateral Agent to satisfy the requirements of the USA PATRIOT Act, including but not limited to the name, address, tax identification number and other information that will allow it to identify the individual or entity who is establishing the relationship or opening the account and may also ask for formation documents such as articles of incorporation or other identifying documents to be provided.
		

		
			7.15      Conflict. In the event of a direct conflict between this Agreement and the Indenture, the Indenture shall control; provided, however, the parties understand and agree that this Agreement sets forth additional covenants, obligations and rights and the parties will use all reasonable efforts to construe the provisions and covenants in this Agreement as not being in direct conflict with the Indenture.
		

		
			The Collateral Agent shall have all the benefits, indemnities, powers, privileges, protections and rights contained in the Indenture (including for the avoidance of any doubt Article 12 of the Indenture) in connection with acting in its capacity as Collateral Agent hereunder.
		

		
			[Remainder of Page Intentionally Left Blank; Signature Page Follows]
		

		
			 
		

		
			 
		

		
			

		 

		

			- 13  -

		

 

		

			 

		

		

		
			IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed and delivered as of the date first above written.
		

			
					
						 

					
					
						Transocean [Enabler/Encourage] Limited, as the Pledgor

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

				
	
					
						 

					
					
						Title:

				

		
			 
		

		
			
		

		
			

		 

		

			[Signature Page to Receivables Pledge Agreement]

		

 

		

			 

		

		

		
			Acknowledged and Agreed to as of the date hereof by:
		

			
					
						WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Collateral Agent

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						By:

					
					
						 

					
					
						 

				
	
					
						Name:

					
					
						 

				
	
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			[Signature Page to Receivables Pledge Agreement]

		

 

		

			 

		

		

		
			SCHEDULE 3.04
		

		
			Names/Trade Names, Jurisdiction of Organization and Chief Executive Office
		

			
					
						Pledgor

					
					
						Jurisdiction of

					
						Organization

					
					
						Location of Pledgor’s Chief

					
						Executive Office or Sole

					
						Place of Business

				
	
					
						Transocean [Enabler/Encourage] Limited

					
					
						Cayman Islands

					
					
						P.O. Box 10342, 36C Dr. Roy’s Drive, Grand Cayman, Cayman Islands KY1-1003

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			APPENDIX J-2
		

		
			FORM OF BAREBOAT ACCOUNT PLEDGE AGREEMENT
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix J-2-1

		

 

		

			 

		

		

		
			 
		

			
					
						Dated: July 13, 2018 

				
	
					
						Transocean [Enabler/Encourage] Limited

					
						 

					
						and

					
						 

					
						Wells Fargo Bank, National Association

					
						as Collateral Agent

					
						 

				
	
					
						 

				
	
					
						 

					
					
						FORM OF

					
						ACCOUNT CHARGE

					
					
						 

				
	
					
						Note: Cayman Islands stamp duty will be payable if this document is executed in, brought to or produced before a court of the Cayman Islands

					
						 

					
						412650.00030

				

		
			 
		

		
			 
		

		
			
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			CONTENTS
		

			
					
						1

					
					
						Definitions and interpretation

					
1
				
	
					
						2

					
					
						Charge

					
4
				
	
					
						3

					
					
						Chargor’s liability not affected

					
4
				
	
					
						4

					
					
						Delivery of documents

					
5
				
	
					
						5

					
					
						Representations and Warranties

					
5
				
	
					
						6

					
					
						Covenants

					
6
				
	
					
						7

					
					
						Enforcement

					
6
				
	
					
						8

					
					
						Receiver

					
8
				
	
					
						9

					
					
						Power of Attorney

					
9
				
	
					
						10

					
					
						Further Assurances

					
10
				
	
					
						11

					
					
						Application of monies

					
11
				
	
					
						12

					
					
						Release

					
11
				
	
					
						13

					
					
						Protection of Secured Creditors, Receivers and Attorneys

					
12
				
	
					
						14

					
					
						Preservation of security

					
12
				
	
					
						15

					
					
						[Reserved]. 

					
12
				
	
					
						16

					
					
						Collateral Agent

					
12
				
	
					
						17

					
					
						Variation, Amendment and Waiver

					
13
				
	
					
						18

					
					
						Assignment

					
13
				
	
					
						19

					
					
						Entire Agreement

					
13
				
	
					
						20

					
					
						Partial Invalidity

					
13
				
	
					
						21

					
					
						Notices

					
13
				
	
					
						22

					
					
						Miscellaneous

					
14
				
	
					
						23

					
					
						Counterparts

					
15
				
	
					
						24

					
					
						Law and Jurisdiction

					
15
				
	
					
						 

					
					
						Schedule 1

					
19
				
	
					
						 

					
					
						Schedule 2

					
19
				
	
					
						 

					
					
						Schedule 3

					
1
				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			This Charge is made on July 13, 2018
		

		
			BETWEEN:
		

		
			(1)        Transocean [Enabler/Encourage] Limited,  an exempted company incorporated in Cayman Islands, with registered number 338045, the registered office of which is at Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands (Chargor); and
		

		
			(2)        Wells Fargo Bank, National Association as collateral agent for and on behalf of the Secured Creditors (Collateral Agent).
		

		
			RECITALS:
		

		
			(A)       The Chargor enters into this Charge in connection with the Indenture.  It is a condition precedent of the Indenture that the Chargor enters into this Charge.
		

		
			(B)       It is intended that this Charge takes effect as a deed notwithstanding that any party may only execute this Charge under hand.
		

		
			It is agreed as follows:
		

		
			1           Definitions and interpretation
		

		
			1.1         In this Charge, words and expressions shall, except where the context otherwise requires, have the meanings given to them in the Indenture, provided that, in the event of any conflict between the meaning of any term as defined in the Indenture and any term as defined in this Charge, the definitions in the Indenture shall prevail.
		

		
			1.2         In this Charge, the following words and expressions shall, except where the context otherwise requires, have the following meanings:
		

		
			Account means the account in the name of the Chargor with the Bank the details of which are as set out in Schedule 1 to this Charge, together with all amounts from time to time standing to the credit of the Account, together with all other rights and benefits accruing to or arising in connection with the Account (including, without limitation, all entitlements to interest) (as such Account may from time to time be renumbered or re-designated and including any sub-account thereof);
		

		
			Authorised Officer means any officer duly and effectively designated in writing by any party hereto or to any other Indenture as having been authorised by such party to execute and deliver this Charge or any other notice, agreement, document, certificate or instrument contemplated under this Charge;
		

		
			Bank means DNB Bank ASA, Cayman Islands Branch;
		

		
			Charge means this account charge;
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			Charged Property means the property and rights of the Chargor which are the subject of any security created or purported to be created by this Charge;
		

		
			Company means Transocean Guardian Limited, an exempted company incorporated in Cayman Islands, with registered number 338041, the registered office of which is at Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands;
		

		
			Gross Negligence means a standard of misconduct beyond negligence whereby a person acts with reckless disregard for the consequences of his action or inaction;
		

		
			Indenture means the indenture dated on or about the date of this Charge (as the same may be amended, restated, amended and restated, supplemented, refinanced, replaced or otherwise modified from time to time) by and among the Company, the Guarantors (as defined therein) party thereto from time to time (including the Chargor) and Wells Fargo Bank, National Association, as trustee and the Collateral Agent, pursuant to which the Company will issue 5.875% Senior Secured Notes due 2024 in an aggregate principal amount of $750,000,000;
		

		
			Legal Reservations means (a) the principle that remedies may be granted or refused at the discretion of a court and the limitation of enforcement by laws relating to bankruptcy, insolvency, reorganisation and other laws generally affecting the rights of creditors; (b) the time barring of claims and defences of set-off or counterclaim; (c) the matters set out in any applicable qualification in a legal opinion delivered in connection with this Charge; and (d) similar principles, rights and defences under the laws of any applicable jurisdiction;
		

		
			Receiver has the meaning given to it in clause 8; and
		

		
			Security Interest means any mortgage, charge, pledge, lien,  assignment, encumbrance, right of set off or any other security interest securing any obligation of any person or any other agreement or arrangement having a similar effect howsoever created or arising.
		

		
			1.3         In the interpretation of this Charge, the following provisions apply save where the context requires otherwise:
		

		
			(a)        references to any person, including, but not limited to, the Collateral Agent, the Chargor and the Company shall include its successors, assignees and transferees and, in the case of the Collateral Agent, any person from time to time appointed as Collateral Agent or Collateral Agents in accordance with the Indenture or any other Note Document;
		

		
			(b)        where references are made to the Collateral Agent holding title to or having possession or control of the Charged Property or any part thereof, such references shall include any person holding title to or having possession or control of the Charged Property or any part thereof for or on behalf of the Collateral Agent, whether as trustee or in some other capacity;
		

		
			(c)        assets includes present and future properties, revenues and rights of every description;
		

		
			
		

		
			

		 

		

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			(d)        any reference to this Charge or to any agreement or document referred to in this Charge shall be construed as a reference to such agreement or document as amended, varied, modified, supplemented, restated, novated or replaced from time to time;
		

		
			(e)         except where the context otherwise requires, words denoting the singular include the plural and vice versa, words denoting a gender include every gender and references to persons include bodies corporate and unincorporate;
		

		
			(f)         indebtedness due, owing or incurred under the Note Documents shall include all moneys, obligations and liabilities due, owing or incurred in respect of any variations or increases in the amount or composition of the facilities provided for therein or the obligations and liabilities imposed thereunder however fundamental;
		

		
			(g)         references to constitutional documents of an entity shall include, without limitation, the certificate(s) of incorporation or establishment, the memorandum and articles of association and, where the entity is the trustee of a trust, the trust instrument constituting the relevant trust;
		

		
			(h)        any reference to a regulation includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation;
		

		
			(i)         an Event of Default is continuing if it has not been remedied or waived;
		

		
			(j)         the word may shall be construed as permissive and the word shall shall be construed as imperative;
		

		
			(k)        any phrase introduced by the terms including,  include,  in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms;
		

		
			(l)         clause headings and the index are inserted for convenience only and shall not affect the construction of this Charge;
		

		
			(m)       references to statutes are, unless otherwise specified, references to statutes of the Cayman Islands (and such reference shall be taken to be to the short title applicable to such statute) and include any statutory amendment, modification, consolidation or re-enactment thereof for the time being in force; and
		

		
			(n)        references to recitals, clauses and Schedules are, unless the context otherwise requires, references to recitals and clauses hereof and Schedules hereto and references to sub-clauses are, unless otherwise stated, references to the sub-clause of the clause in which the reference appears; and
		

		
			(o)        the recitals and the Schedules form part of this Charge and shall have the same force and effect as if they were expressly set out in the body of this Charge and any reference to this Charge shall include the recitals and the Schedules.
		

		
			
		

		
			

		 

		

			3

		

 

		

			 

		

		

		
			2           Charge
		

		
			2.1       The Chargor hereby charges by way of first fixed charge and assigns by way of security to the Collateral Agent as a continuing security for the full and punctual payment and discharge of the Notes Obligations, all its right, title, interest and benefit present and future in, to and under the Account.
		

		
			2.2        Subject to and in accordance with the terms and conditions of the Indenture and for as long as no Event of Default has occurred and is continuing or a Blocked Period is in effect, the Collateral Agent (acting in the name and on behalf of the Secured Creditors) hereby authorises the Chargor to operate the Account, in particular to draw any of the balances standing to the credit of the Account, freely in the ordinary course of its business.
		

		
			2.3       The Chargor shall be free to close the Account at any time without any prior consent or notification of the Collateral Agent; provided that, to the extent required by the Indenture, any amounts standing to the credit of the Account are transferred to another bank account encumbered in favour of the Collateral Agent.
		

		
			2.4        Upon the occurrence and during the continuation of an Event of Default for which the Chargor has received written notice from the Collateral Agent of its intent to exercise remedies hereunder or during a Blocked Period, the Chargor shall no longer be entitled to operate the Account (including disposing of any of the Charged Property) without the Collateral Agent's prior written consent, in which case the Secured Creditors, represented by the Collateral Agent, may inform the Bank about the expiry of the authorisation granted under this clause 2.  Upon the termination of a Blocked Period, the Collateral Agent shall deliver a notice to the Bank reinstating the authorisation granted under this clause 2.
		

		
			3           Chargor’s liability not affected
		

		
			3.1        Neither the obligations of the Chargor contained in this Charge nor the rights, powers and remedies conferred upon the Collateral Agent in respect of the Chargor by this Charge or by law shall be discharged, impaired or otherwise affected by reason of any of the following events or circumstances (whether any such event or circumstance occurs with or without the Collateral Agent’s knowledge or consent):
		

		
			(a)        the winding-up, dissolution, administration, receivership, amalgamation, reconstruction, merger, consolidation or reorganisation (or equivalent insolvency procedure) of the Chargor, the Collateral Agent or the Company, or any change in their status, function, control or ownership;
		

		
			(b)        any of the Notes Obligations or any other security taken in respect of the Notes Obligations being or becoming wholly or partially illegal, invalid, unenforceable or ineffective in any respect;
		

		
			(c)        any time, forbearance or other indulgence being granted or agreed to be granted to the Company, the Chargor or any other person in respect of any of the Notes Obligations or under any other security taken in respect of the Notes Obligations;
		

		
			
		

		
			

		 

		

			4

		

 

		

			 

		

		

		
			(d)        any amendment to, or any variation, waiver or release of, any of the Notes Obligations or any other security taken in respect of the Note Obligations or any amendment to, restatement of or supplement to any Note Document;
		

		
			(e)        any failure to take, or fully to take, any security agreed to be taken in relation to any of the Notes Obligations;
		

		
			(f)         any failure to realise or fully to realise the value of, or any release, discharge, exchange or substitution of, any security taken in respect of the Notes Obligations; or
		

		
			(g)        any other act, event or omission which, but for this clause 3.1, might operate to discharge, impair or otherwise affect any of the obligations of the Chargor contained in this Charge or any of the rights, powers or remedies conferred upon the Collateral Agent by this Charge or by law.
		

		
			4           Delivery of documents
		

		
			4.1       On the execution and delivery of this Charge, the Chargor shall promptly execute and deliver a notice of assignment to the Bank in the form set out in Schedule 2 to this Charge and use its reasonable endeavours to procure that an acknowledgement in the form set out in Schedule 3 to this Charge is delivered by the Bank to the Collateral Agent.
		

		
			4.2       Within five Business Days of the date of this Charge, the Chargor shall provide the Collateral Agent with a copy of the Chargor's register of mortgages and charges showing the particulars of this Charge.
		

		
			5           Representations and Warranties
		

		
			5.1         The Chargor represents and warrants to the Collateral Agent on the date of this Charge that:
		

		
			(a)        it is the sole legal and beneficial owner of the Charged Property and the Charged Property is free from any Security Interest other than Permitted Collateral Liens;
		

		
			(b)        it is duly incorporated and in good standing under the laws of the jurisdiction in which it is incorporated and it has and will at all times have the necessary power to enter into and perform its obligations under this Charge and has duly authorised the execution and delivery of this Charge and the performance of its obligations hereunder;
		

		
			(c)        it has full power, authority and legal right to enter into and engage in the transactions contemplated by this Charge and has taken or obtained all necessary corporate and other action and consents to authorise the execution and performance of this Charge;
		

		
			(d)        subject to the Legal Reservations, this Charge creates the Security Interests it purports to create, with the priority and ranking it is expressed to have (subject to Permitted Collateral Liens), and is not liable to be avoided or otherwise set aside on its liquidation, winding-up or otherwise;
		

		
			
		

		
			

		 

		

			5

		

 

		

			 

		

		

		
			(e)         subject to the Legal Reservations, this Charge constitutes the legal, valid, binding and enforceable obligations of the Chargor effective in accordance with its terms; and
		

		
			(f)         the execution, delivery, observance and performance by the Chargor of this Charge will not require the Chargor to obtain any material licences, consents or approvals (in each case other than those that have been obtained or will be obtained prior to the date hereof) and will not result in any violation of any material law, statute, ordinance, rule or regulation applicable to it or any other material agreements applicable to it.
		

		
			6           Covenants
		

		
			6.1        The Chargor covenants and undertakes with the Collateral Agent that, for so long as any Notes Obligations remain outstanding, it shall:
		

		
			(a)        at the Collateral Agent's request (acting at the direction of the requisite Holders), forward all advices, statements, orders, notices and other documents relating to the Account which the Chargor may receive from time to time; and
		

		
			(b)        use commercially reasonable efforts to enforce any rights and institute, continue or defend any proceedings relating to the Account which the Collateral Agent (acting at the direction of the requisite Holders) may require from time to time.
		

		
			7           Enforcement
		

		
			7.1        The security created by this Charge shall become immediately enforceable if an Event of Default occurs and is continuing.
		

		
			7.2        The Chargor shall forthwith following the security created by this Charge becoming enforceable, sign, seal, execute, deliver and complete all transfers, renunciations, proxies, mandates, assignments, deeds and documents and do all acts and things which the Collateral Agent may require (acting at the direction of the requisite Holders),, at any time and from time to time specify for enabling or assisting the Collateral Agent:
		

		
			(a)         to perfect its title to and security over the Charged Property;
		

		
			(b)         to vest the Charged Property in the Collateral Agent or its nominee or nominees;
		

		
			(c)         to exercise (or enable its nominee or nominees to exercise) any rights or powers attaching to the Charged Property;
		

		
			(d)         to sell or dispose of the Charged Property; and/or
		

		
			(e)         otherwise to enforce any of the rights of the Collateral Agent under or in connection with this Charge.
		

		
			7.3        At any time after an Event of Default has occurred and is continuing, the Collateral Agent may, without notice to or further consent or concurrence by, the Chargor and without prior authorisation from any court, and at all times without prejudice to any other right or remedy available hereunder or under applicable law:
		

		
			
		

		
			

		 

		

			6

		

 

		

			 

		

		

		
			(a)         upon receiving direction from the requisite Holders, call for payment to it of the Account and shall be entitled to apply and shall apply all or any part of the Account towards the discharge of the Notes Obligations in accordance with the Indenture;
		

		
			(b)        appropriate, transfer or set off all or any part of the moneys in the Account in or towards the payment or discharge of the Notes Obligations in accordance with the Indenture and, for this purpose, the Collateral Agent is entitled to, at the expense of the Chargor, convert all or part of such monies into other currencies.  These provisions apply notwithstanding that any such monies may have been deposited for a fixed period or be subject to a period of notice and that the fixed period or period of notice may not have expired or that notice or sufficient notice may not have been given;
		

		
			(c)         take possession of, collect and get in  the Charged Property or any part thereof or otherwise exercise in relation to the Charged Property or any part thereof all of the rights of an absolute owner and, for that purpose, to take such proceedings as may seem to it to be expedient;
		

		
			(d)         settle, adjust, refer to arbitration, compromise and arrange any claims, accounts, disputes, questions and demands with or by any person who is or claims to be a creditor of the Chargor or relating to the Charged Property;
		

		
			(e)         bring, prosecute, enforce, defend and abandon actions, suits and proceedings in relation to the Charged Property;
		

		
			(f)         redeem any security (whether or not having priority to this Charge) over the Charged Property and to settle the accounts of any person with an interest in the Charged Property;
		

		
			(g)        exercise and do (or permit the Chargor or any nominee of the Chargor to exercise and do) all such rights and things as the Collateral Agent would be capable of exercising or doing if it were the absolute beneficial owner of the Charged Property;
		

		
			(h)        do anything else for the realisation of the Charged Property or incidental to the exercise of any of the rights conferred on the Collateral Agent under or by virtue of any document to which the Chargor is party;
		

		
			(i)         exercise all rights and remedies afforded to it under this Charge and applicable law;
		

		
			(j)         appoint attorneys or accountants or other professionally qualified person to assist it in the performance of its rights and remedies;
		

		
			(k)        bring or defend any action or other legal proceedings in the name of and on behalf of the Chargor in respect of the Charged Property;
		

		
			(l)         do all acts and execute in the name and on behalf of the Chargor any document or deed in respect of the Charged Property; and
		

		
			(m)       make any payment which is necessary or incidental to the performance of its functions.
		

		
			
		

		
			

		 

		

			7

		

 

		

			 

		

		

		
			7.4        Nothing done by or on behalf of the Collateral Agent pursuant to this Charge shall render it liable to account as a mortgagee in possession for any sums except in the case of actual fraud or Gross Negligence.
		

		
			7.5        The Collateral Agent may delegate in any manner to any person (including any Receiver) any rights or powers exercisable by the Collateral Agent under this Charge.
		

		
			7.6        Neither the Collateral Agent nor any of its agents, managers, officers, employees, directors, delegates or advisers shall be liable for any claim, demand, liability, loss, damage, cost or expense incurred or arising in connection with the exercise or purported exercise of any rights, powers and discretions hereunder in the absence of wilful misconduct, Gross Negligence or actual fraud.
		

		
			7.7        The Collateral Agent shall be entitled (i) to receive all the benefits, indemnities, powers, privileges, protections and rights contained in the Indenture, (ii) to receive an Officer’s Certificate and an Opinion of Counsel in accordance with Section 14.02 of the Indenture, and (iii) to act with the consent of the requisite Holders as provided in the Indenture, in each case in connection with acting in its capacity as Collateral Agent hereunder.
		

		
			8           Receiver
		

		
			8.1        At any time after an Event of Default has occurred and is continuing, without notice to or further consent or concurrence by the Chargor, the Collateral Agent (acting at the direction of the requisite Holders) may appoint one or more person or persons to be a receiver (the Receiver) in relation to the Charged Property.  Where the Collateral Agent appoints two or more persons as Receiver, the Receivers may act jointly or severally.
		

		
			8.2        The Receiver may without notice to or further consent or concurrence by the Chargor or the Company, take such action in relation to the enforcement of this Charge including, without limitation, to sell, charge or otherwise dispose of the Charged Property, to exercise any powers, discretion, voting or other rights or entitlements in relation to the Charged Property and generally to carry out any other action which he may in his sole discretion deem necessary in relation to the enforcement of this Charge, subject to the rights of the Collateral Agent as holder of the security.
		

		
			8.3        The Collateral Agent may from time to time determine the remuneration of the Receiver.
		

		
			8.4       The Receiver shall have, in addition to the other powers set-out in this Charge and all powers confirmed on it by law, during the existence of an Event of Default and subject to applicable law, the following powers:
		

		
			(a)        power to take possession of, collect and get in the Account and, for that purpose, to take such proceedings as may seem to him to be expedient;
		

		
			(b)        power to appoint an attorney or accountant or other professionally qualified person to assist him in the performance of his functions;
		

		
			
		

		
			

		 

		

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			(c)        power to bring or defend any action or other legal proceedings in the name of and on behalf of the Chargor in respect of the Account;
		

		
			(d)        power to do all acts and execute in the name and on behalf of the Chargor any document or deed in respect of the Account;
		

		
			(e)        power to exercise all rights of the Collateral Agent under or pursuant to this Charge including all voting and other rights attaching to the Charged Property;
		

		
			(f)        power to make any arrangement or compromise on behalf of the Chargor in respect of the Charged Property;
		

		
			(g)        power to appoint managers, officers and agents for the above purposes at such remuneration as the Receiver may (acting reasonably) determine;
		

		
			(h)        power to make any payment which is necessary or incidental to the performance of his functions; and
		

		
			(i)         power to do all other things incidental to the exercise of the foregoing powers.
		

		
			8.5        The Receiver shall be the agent of the Chargor and the Chargor alone shall be responsible (other than where there is wilful misconduct or Gross Negligence) for his acts and defaults and shall be liable on any contracts made, entered into or adopted by the Receiver.  The Collateral Agent shall not be liable for the Receiver's acts, omissions, negligence or default, nor be liable on contracts entered into or adopted by the Receiver.
		

		
			8.6        The Collateral Agent may remove a Receiver in respect of all or any of the Charged Property of which he is the Receiver and after the Receiver has vacated office or ceased to act in respect of any of the Charged Property, appoint a replacement Receiver over all or any of the Charged Property in respect of which the previous Receiver shall have ceased to act.
		

		
			9           Power of Attorney
		

		
			9.1        The Chargor hereby irrevocably and by way of security for the payment of the Notes Obligations and the performance of its obligations under this Charge, appoints the Collateral Agent and each and every person to whom the Collateral Agent from time to time has delegated the exercise of the power of attorney conferred by this clause to be its true and lawful attorney or attorneys (with full power to appoint substitutes and to sub-delegate) on behalf of the Chargor and in the Chargor's own name or otherwise, at any time and from time to time, to:
		

		
			(a)         sign, seal, execute, deliver and complete all transfers, renunciations, proxies, mandates, assignments, deeds and documents and do all acts and things which the Collateral Agent may consider to be reasonably necessary, advisable or desirable to:
		

		
			(b)         perfect its security over the Account;
		

		
			(c)         to carry out any obligation imposed on the Chargor by this Charge; and
		

		
			
		

		
			

		 

		

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			(d)        enable the Collateral Agent and any Receiver to exercise or delegate the exercise of any rights, powers and authorities conferred on them by or pursuant to this Charge or by law;
		

		
			(e)        give proper effect to the intent and purposes of this Charge;
		

		
			(f)         enable or assist in any way in the exercise of any right or the enforcement thereof, including any power of sale of the Charged Property (whether arising under this Charge or implied by statute or otherwise); and
		

		
			(g)        perform any other act of any description which may be required of the Chargor under this Charge or may be deemed by such attorney(s) necessary, advisable or desirable for any purpose of this Charge or to constitute, enhance or perfect the security intended to be constituted by this Charge or to convey or transfer legal ownership of any of the Charged Property.
		

		
			9.2        The power of attorney provided in clause 9.1 shall not be exercisable by or on behalf of the Collateral Agent unless an Event of Default has occurred and is continuing.
		

		
			9.3        The Chargor hereby ratifies and confirms and agrees to ratify and confirm any instrument, act or thing which any attorneys appointed pursuant hereto may execute or do in accordance with its appointment under this clause.  In relation to the powers referred to herein, the exercise by the Collateral Agent of such powers shall be conclusive evidence of its right to exercise the same.
		

		
			9.4        All sums expended by the Collateral Agent under this clause shall be recoverable from the Chargor in accordance with the terms of this Charge; however, the Collateral Agent is not required to expend any of its own funds.  The Chargor agrees to indemnify the Collateral Agent to the extent required by Section 12.10 of the Indenture.
		

		
			10         Further Assurances
		

		
			10.1      The Chargor must promptly at its own cost, take whatever action required for (or which the Collateral Agent, acting at the direction of the requisite Holders, or a Receiver may reasonably require for):
		

		
			(a)         creating, perfecting or protecting any security intended to be created by this Charge;
		

		
			(b)         exercising any right, power or discretion exercisable by the Collateral Agent or any Receiver or any of its delegates or sub-delegates in respect of any Charged Property; or
		

		
			(c)         after this Charge has become enforceable, facilitating the realisation of any Charged Property, or the exercise of any right, power or discretion exercisable, by the Collateral Agent or any Receiver or any of its delegates or sub-delegates in respect of any Charged Property.
		

		
			
		

		
			

		 

		

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			11         Application of monies
		

		
			11.1     The Collateral Agent (and any Receiver) shall apply the monies received by it as a result of the enforcement of the security created hereby in accordance with the Indenture.
		

		
			11.2     The Collateral Agent shall not be liable for any loss or damage occasioned by:
		

		
			(a)         any sale or disposal of the Account or an interest in the Account; or
		

		
			(b)         arising out of the exercise, or failure to exercise, any of its powers under this Charge; or
		

		
			(c)         any other loss of whatever nature in connection with the Account
		

		
			in each case, in the absence of wilful misconduct, Gross Negligence or actual fraud.
		

		
			12         Release
		

		
			12.1      Upon:
		

		
			(a)         the occurrence of any of the events described in clause (a) or (b) of Section 12.02 of the Indenture and the satisfaction of any conditions precedent set forth therein; or
		

		
			(b)         the replacement of the Chargor as the “Collateral Rig Owner” in accordance with:
		

		
			(i)         a fundamental change of the Chargor not prohibited by Section 4.13 of the Indenture; and/or
		

		
			(ii)        a transaction permitted by Section 4.27 or Section 4.29 of the Indenture, as applicable,
		

		
			the Security Interests created by this Charge shall terminate and all rights to the Charged Property shall revert to the Chargor.  This Charge and the Security Interest granted hereby shall, in whole or in part, automatically terminate and be released and all rights to the Charged Property so released shall automatically revert to the Chargor, upon consent of the requisite Holders in accordance with Sections 10.02 and 12.02 of the Indenture. Upon any such termination, upon the written request of the Chargor and delivery of an Officer’s Certificate and Opinion of Counsel, the Collateral Agent will at the Chargor’s expense, execute and deliver to the Chargor such documents as the Chargor shall reasonably request to evidence such termination.
		

		
			12.2      Any receipt, release or discharge of any security created by this Charge or of any liability arising under this Charge or any other Note Document may be given by an Authorised Officer of the Collateral Agent in accordance with the provisions of this Charge or any other Note Document and shall not release or discharge the Chargor from any liability to the Collateral Agent for the same or any other monies which may exist independently of this Charge or any other Note Document.  Where such receipt, release or discharge relates to only part of the Notes Obligations such receipt, release or discharge shall not prejudice or affect any other part thereof nor any of the rights and remedies of the Collateral Agent hereunder or under the Indenture nor any of the obligations of the Chargor under this Charge or any other Note Document.
		

		
			
		

		
			

		 

		

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			13         Protection of Secured Creditors, Receivers and Attorneys
		

		
			13.1      No Secured Creditor, Receiver or Attorney is liable for any loss or damage, including consequential loss or damage, arising directly or indirectly from:
		

		
			(a)         any omission or delay in the exercise or non-exercise of any right; or
		

		
			(b)         the neglect, default or dishonesty of any manager, officer, employee, agent, accountant, auctioneer or solicitor of the Chargor, a Secured Creditor, Receiver or Attorney,
		

		
			except to the extent the loss or damage arises from the wilful misconduct, actual fraud or Gross Negligence on its part.
		

		
			14         Preservation of security
		

		
			14.1      Continuing security
		

		
			(a)        The security constituted by this Charge shall be continuing and shall not be considered as satisfied or discharged by any intermediate payment or settlement of the whole or any part of the Notes Obligations or any other matter or thing whatsoever and shall be binding until all the Notes Obligations have been unconditionally paid and discharged in full in accordance with the Indenture.
		

		
			(b)        This Charge is in addition to and shall not merge with or otherwise prejudice or affect any banker's lien, right to combine and consolidate accounts, right of set‐off or any other contractual or other right or remedy or any guarantee, lien, pledge, bill, note, charge or other security now or hereafter held by or available to the Collateral Agent.
		

		
			14.2      Continuation of accounts
		

		
			If the Collateral Agent receives notice of any subsequent mortgage, charge, assignment, or other disposition affecting any account opened with the Collateral Agent by the Chargor, or any part thereof or interest therein, the Collateral Agent may open a new account for the Chargor. If the Collateral Agent does not open a new account then unless the Collateral Agent gives express written notice to the contrary to the Chargor it shall nevertheless be treated as if it had done so at the time when it received such notice and as from that time all payments made by or on behalf of the Chargor to the Collateral Agent shall be credited or be treated as having been credited to the new account and shall not operate to reduce the amount due from the Chargor to the Collateral Agent at the time when it received notice.
		

		
			15         [Reserved].
		

		
			16         Collateral Agent
		

		
			The parties to this Charge hereby acknowledge and agree that the Collateral Agent holds the benefit of this Charge (and any other security created in its favour pursuant to this Charge) on trust for and on behalf of the Secured Creditors in its capacity as Collateral Agent under and pursuant to the terms of the Indenture.  The retirement of the person for the time being acting as
		

		
			
		

		
			

		 

		

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			Collateral Agent and the appointment of any successor Collateral Agent shall be effected in the manner provided for in the Indenture.
		

		
			17         Variation, Amendment and Waiver
		

		
			17.1      This Charge shall remain in full force and effect notwithstanding any amendments or variations from time to time of any Note Document.
		

		
			17.2      Any term of this Charge may only be amended in a writing signed by the Collateral Agent (acting in accordance with the Indenture) and the Chargor.
		

		
			17.3      Any waiver by the Collateral Agent of any terms of this Charge or any consent or approval given by the Collateral Agent under it shall only be effective if given in writing and then only for the purpose and upon the terms and conditions (if any) for which it is given.
		

		
			18         Assignment
		

		
			18.1      Except to the extent not prohibited by the Indenture, the Chargor may not assign or transfer all or any part of its rights, benefits or obligations under this Charge to any other person.
		

		
			18.2      The Collateral Agent may assign any of its rights and transfer any of its obligations under this Charge to any successor Collateral Agent appointed in accordance with the Indenture, who shall be entitled to enforce and proceed upon this Charge in the same manner as if named herein.
		

		
			19         Entire Agreement
		

		
			This Charge, the Indenture and the other Note Documents constitute the entire agreement and understanding of the parties and supersede any previous agreement between the parties relating to the subject matter of this Charge.
		

		
			20         Partial Invalidity
		

		
			If at any time any one or more of the provisions of this Charge is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction neither the legality, validity or enforceability of the remaining provisions of this Charge nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall be in any way affected or impaired as a result.
		

		
			21         Notices
		

		
			21.1      Any communication to be made under or in connection with this Charge shall be made in writing and, unless otherwise stated, may be made by electronic communication or letter in accordance with this clause.
		

		
			21.2      The address and email address (and the department or officer, if any, for whose attention the communication is to be made) of each party for any communication or document to be made or delivered under or in connection with this Charge is:
		

		
			(a)         in the case of the Chargor:
		

		
			
		

		
			

		 

		

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			(i)         Address: Transocean Corporate Services Limited, P.O. Box 10342, 36c Dr. Roy’s Drive, 4th Floor, Grand Cayman KY1-1003, Cayman Islands;
		

		
			(ii)        Email address: Steve.McFadin@deepwater.com;
		

		
			(iii)       Attention: C. Stephen McFadin; and
		

		
			(b)         in the case of the Collateral Agent:
		

		
			(i)         Address: 1445 Ross Avenue, Suite 4300, MAC T9216-430 Dallas, TX 75202, USA;
		

		
			(ii)        Email address:
		

		
			(iii)       Attention:  Corporate, Municipal & Escrow Services;
		

		
			or any substitute address or email address or department or officer as the Chargor may notify to the Collateral Agent or the Collateral Agent may notify to the Chargor, by not less than two Business Days' notice.
		

		
			21.3      Any communication made or delivered by one person to another under or in connection with this Charge will only be effective to the extent set forth in the Indenture.
		

		
			22         Miscellaneous
		

		
			22.1      All sums payable by the Chargor under this Charge shall be paid without any set‐off, counterclaim, withholding or deduction whatsoever unless required by law in which event the Chargor will simultaneously with making the relevant payment under this Charge pay to the Collateral Agent such additional amount as will result in the receipt by the Collateral Agent of the full amount which would otherwise have been receivable and will supply the Collateral Agent promptly with evidence satisfactory to the Collateral Agent that the Chargor has accounted to the relevant authority for the sum withheld or deducted.
		

		
			22.2      No delay or omission on the part of the Collateral Agent in exercising any right, power or remedy under this Charge shall impair that right, power or remedy or operate as or be taken to be a waiver of it nor shall any single, partial or defective exercise of any such right, power or remedy preclude any other or further exercise under this Charge of that or any other right, power or remedy.
		

		
			22.3      The Collateral Agent's rights powers and remedies under this Charge are cumulative and are not, nor are they to be construed as, exclusive of any rights, powers or remedies provided by law or otherwise and may be exercised from time to time and as often as the Collateral Agent deems expedient.
		

		
			22.4      Any statement, certificate or determination of the Collateral Agent as to the Notes Obligations or (without limitation) any other matter provided for in this Charge shall, in the absence of manifest error, be conclusive and binding on the Chargor.
		

		
			
		

		
			

		 

		

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			22.5      The parties hereby agree that each agent, manager, officer, employee, director, delegate or advisor of the Collateral Agent who is not a party to this Charge (a Third Party) has the express right to enforce the contractual terms of this Charge pursuant to the terms of The Contracts (Rights of Third Parties) Law, 2014. Notwithstanding any term of this Charge, the consent of or notice to any Third Party shall not be required for any termination, rescission or agreement to any variation, waiver, assignment, novation, release or settlement under this Charge at any time.
		

		
			23         Counterparts
		

		
			This Charge may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed signature page to this Charge by facsimile or electronic transmission shall be effective as delivery of a manually signed counterpart of this Charge.
		

		
			24         Law and Jurisdiction
		

		
			24.1      This Charge is governed by, and shall be construed in accordance with, the laws of the Cayman Islands.
		

		
			24.2      Each party hereto irrevocably agrees for the exclusive benefit of the other party that the courts of the Cayman Islands shall have jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute which may arise out of or in connection with this Charge and for such purposes irrevocably submits to the jurisdiction of such courts.
		

		
			 
		

		
			 
		

		
			

		 

		

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			IN WITNESS WHEREOF this Charge has been executed and delivered as a Deed the day and year first above written.
		

			
					
						Signed as a deed by Transocean [Enabler/Encourage] Limited

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			 
		

		
			
		

		

		 

		

			 

		

 

		

			 

		

	
					
						

					
						Signed by Wells Fargo Bank, National Association, as Collateral Agent

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title/ Capacity

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						in the presence of:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Signature of witness

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Print name

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Title

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			SCHEDULE 4
		

		
			Account
		

			
					
						Account Holder's Name

					
					
						Bank Name and Address

					
					
						Denomination of Account

					
					
						Account Number

				
	
					
						Transocean [Enabler/Encourage] Limited

					
					
						DNB Bank ASA, Cayman Islands Branch, 

					
					
						US Dollars

					
					
						[14804001/15604001]

				

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			SCHEDULE 5
		

		
			Notice to Bank
		

		
			From:    Transocean [Enabler/Encourage] Limited
		

		
			To:        DNB Bank ASA, Cayman Islands Branch
		

		
			________________________, 2018
		

		
			Dear Sirs
		

		
			Transocean [Enabler/Encourage] Limited – account number [14804001/15604001]
		

		
			We hereby give you notice that by a charge of a bank account dated July 13, 2018 (the Charge) between Transocean [Enabler/Encourage] Limited (the Chargor) and Wells Fargo Bank, National Association, as collateral agent (the Collateral Agent), the Chargor has granted a first fixed charge and assignment by way of security to the Collateral Agent of all its right, title, interest and benefit, present and future, in and to all amounts from time to time standing to the credit of the account of the Chargor maintained with you and designated account number [14804001/15604001], together with all other rights and benefits accruing to or arising in connection with the foregoing (including, without limitation, all entitlements to interest) (as such account may from time to time be renumbered or re-designated and including any sub-account thereof) (the Account).
		

		
			We hereby irrevocably authorise and instruct you, following confirmation that the security is enforceable under clause 8 of the Charge:
		

		
			1            unless otherwise instructed by the Collateral Agent, to comply only with the written directions from time to time of the Collateral Agent in relation to the operation of the Account (including, without limitation, any directions concerning the withdrawal or transfer of any funds from the Account);
		

		
			2            hold all sums standing to the credit of the Account to the order of the Collateral Agent and to credit all interest earned on the monies standing to the credit of the Account to the Account; and
		

		
			3            disclose to the Collateral Agent any information relating to the Account requested from you by the Collateral Agent and to supply to the Collateral Agent and the Chargor copies of all advices, statements, orders, notices and other documents relating to the Account (but without any liability on your part for any failure or omission to do so).
		

		
			We acknowledge that you may comply with the instructions in this letter without any further permission from us.
		

		
			The instructions in this letter may not be revoked or amended without the prior written consent of the Collateral Agent.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			We should be obliged if you would acknowledge receipt of this letter and confirm the Collateral Agent's interest in the Account by sending to the Collateral Agent a letter in the form of the enclosed draft.
		

		
			This letter is governed by, and shall be construed in accordance with, the laws of the Cayman Islands.
		

		
			Yours faithfully
		

		
			...................................................
		

		
			For and on behalf of Transocean [Enabler/Encourage] Limited
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			SCHEDULE 6
		

		
			Acknowledgment
		

		
			From: DNB Bank, ASA - Cayman Islands Branch
		

		
			To: Wells Fargo Bank, National Association, as Collateral Agent
		

		
			______________________ 2018
		

		
			Dear Sirs
		

		
			Transocean [Enabler/Encourage] Limited and account number [14804001/15604001 (the Account)
		

		
			We hereby acknowledge receipt of the notice of charge from Transocean [Enabler/Encourage] Limited dated [•] 2018 in respect of the Account (the Notice).
		

		
			We confirm that we consent to the security to be created over the Account in favour of Wells Fargo Bank, National Association as collateral agent (the Collateral Agent), and confirm that this acknowledgement satisfies the requirements of our standard terms and conditions that written consent be provided in respect of any security to be taken over the Account.
		

		
			Capitalised terms used but not defined herein shall have the meanings ascribed to them in the Notice.
		

		
			We accept the instructions contained in the Notice and we irrevocably undertake with you that until receipt of written notice by us from you confirming that you no longer have any interest in the Account:
		

		
			1          we agree to comply with the instructions contained in the Notice;
		

		
			2          we have not claimed or exercised, nor will claim or exercise, any security interest, right of combination, consolidation, merger, set-off or other right in respect of any monies standing or accruing to the credit of the Account; and
		

		
			3          following confirmation that the security is enforceable under clause 8 of the Charge, we shall only permit monies to be withdrawn from or debited to the Account against the signature of an authorised officer of the Collateral Agent (an Authorised Signatory),
		

		
			provided that any notice or instructions purporting to be made by you hereunder, and any signature appearing to be that of an Authorised Signatory of you, shall conclusively be deemed to be made by the Collateral Agent, and signed by such an Authorised Signatory, without any obligation whatsoever on us to make any enquiry of you or any other person, and we shall be under no liability
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			whatsoever to you or any other person in consequence of our treating any such notice, instruction or signature as being fully valid and effective.  Without prejudice to the foregoing, you shall supply us from time to time with a list of your Authorised Signatories and accompanied by a specimen signature signed by each of them.
		

		
			We confirm that we have not received any notice nor claim in respect of the Account and the monies standing to the credit of the Account from any third party and that, so far as we are aware, the Account and the monies standing to the credit of the Account are free from any encumbrances, claims, liens or other security interest (save for the Charge).
		

		
			We further acknowledge that you shall have no liability for any costs, charges and expenses incurred in respect of the opening, maintenance and operation of the Account.
		

		
			Yours faithfully
		

		
			...................................................
		

		
			For and on behalf of
		

		
			DNB Bank ASA, Cayman Islands Branch
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			APPENDIX K
		

		
			FORM OF DEED OF QUIET ENJOYMENT
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix K-1

		

 

		

			 

		

		

		
			Private & Confidential
		

		
			Letter of Undertaking
		

		
			To:        Wells Fargo Bank, National Association,
		

		
			as Collateral Agent under the Indenture
		

		
			1445 Ross Avenue, Suite 4300
		

		
			MAC T9216-430
		

		
			Dallas, TX  75202
		

		
			Attention: Corporate, Municipal & Escrow Services
		

		
			Facsimile: (214) 756-7401
		

		
			(the “Security Agent” )
		

		
			11 July, 2018
		

		
			Dear Sirs,
		

		
			RE: “Songa Encourage” and “Songa Enabler” (each a “Drilling Unit” and together the “Drilling Units”), two semisubmersible drilling rigs currently owned by Transocean Encourage Limited and Transocean Enabler Limited (each an “Owner” or a “Guarantor” and together the “Owners” or the “Guarantors”)
		

		
			We, Equinor Energy AS, formerly known as Statoil Petroleum AS, acting for and behalf of the Licence Group (as defined in the relevant Drilling Contract), refer to:
		

		
			(a)       each of the Marine Drilling Contracts dated 23 February, 2012 and signed 25 April, 2012 made between Equinor Energy AS, formerly known as Statoil Petroleum AS (the “Company”), and Songa Offshore Rig 3 AS (the “Bareboat Charterer”) as contractor in relation to each of the Drilling Units (as amended, novated, varied or supplemented from time to time, a “Drilling Contract” and together the “Drilling Contracts”);
		

		
			(b)       the Indenture dated 13 July, 2018 to be entered into between, inter alios, Transocean Guardian Limited, as issuer, the Owners as joint and several guarantors, the other guarantors from time to time party thereto and the Security Agent, as trustee and collateral agent (the “Indenture”);
		

		
			(c)       each of the bareboat charter agreements each dated 13 November, 2014 made between the Bareboat Charterer and each of the Guarantors in relation to each of the Drilling Units (each, as may be amended, varied and/or supplemented from time to time, the “BBC” and together the “BBCs”); and
		

		
			(d)       the first priority mortgages (the “Mortgages”) entered, or to be entered, into in respect of the Drilling Units by the Guarantors and the Security Agent in respect of the Drilling Units and the assignment of earnings (the “Security Agreement”) dated July 13, 2018 entered into by the Bareboat Charterer and the Security Agent in respect of the Drilling Units of which we have received, or will receive, notice of and whereby i.a. all earnings under the Drilling Contracts have been or will be assigned by the Bareboat Charterer to the Security Agent.
		

		
			1.           References in this Letter of Undertaking to the Indenture, the Mortgages, the Security Agreement (together the “Finance Documents”) or to the Drilling Contracts shall include such documents as novated, amended, supplemented or varied from time to time.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			 
		

		
			2.           For the purpose of facilitating the financing of the Drilling Units as contemplated in the Indenture, we agree to the undertakings and covenants as set out in this Letter of Undertaking.
		

		
			3.           The Company hereby acknowledges the Security Agent’s rights to enforce or exercise its rights pursuant to the Finance Documents in accordance with the terms thereof, including the Security Agent’s rights to require or effect a sale or transfer of the Drilling Units (insofar as permitted pursuant to the below, a “Permitted Transfer”), and confirms that it will accept a change of party to the Drilling Contracts, or to enter into new contracts on the same terms as the Drilling Contracts with the new owner or charterer of the Drilling Units in connection with a Permitted Transfer, subject to the following conditions:
		

		
			a)   the rights of the Company under the Drilling Contract or Drilling Contracts shall be fully preserved and protected following the Permitted Transfer and the obligations and liabilities of the Company under the Drilling Contracts shall not be increased as a result of the Permitted Transfer; and
		

		
			b)   that the Bareboat Charterer’s substitute (having assumed the rights and obligations of the Bareboat Charterer under the Drilling Contract or Drilling Contracts, the “Substitute”) is, at the Company’s sole discretion, acceptable to the Company to perform the obligations of the Bareboat Charterer under the Drilling Contract or Drilling Contracts.
		

		
			Provided that the conditions in items 3 a) and b) are fulfilled, the Company shall consent to the Permitted Transfer and use all reasonable endeavours to co-operate with the Security Agent in order to effect the Permitted Transfer and the transfer of the Drilling Contracts or entry-into of new identical contracts with the Substitute.
		

		
			4.               The Company hereby acknowledges and undertakes to the Security Agent that:
		

		
			(e)       without prejudice to any rights the Company may have in respect of any default by the Bareboat Charterer of any of its obligations under each Drilling Contract (including for avoidance of doubt the right to terminate the contract), the Company will give the Security Agent the opportunity to (if the Security Agent, in its sole discretion, so chooses to) remedy (or procure the remedy of) any default by the Bareboat Charterer of any of its obligations under or in connection with the Drilling Contract under (to the extent applicable) the cure period under Article 12.1 of the Drilling Contract or any such other remedy period that may apply under the Drilling Contract or is otherwise specified by the Company from time to time (if any) (each a “Cure Period”), and the Company will not terminate the Drilling Contract if the Security Agent does so remedy (or procure the remedy of) the default (insofar as such default is capable of being remedied by the Security Agent (by the payment of money or otherwise)) within the relevant Cure Period;
		

		
			(f)       without prejudice to Company’s rights under each Drilling Contract (including for avoidance of doubt the right to terminate the contract), in case the Security Agent intends to enforce or exercise its rights to require or effect a sale or transfer of the Drilling Units, the Security Agent shall within 15 days submit notice that such rights will be exercised or enforced and details of the proposed Substitute, and for a period of 60 days after submission of such notice, the Security Agent and the Company will consult on the acceptibility of such proposed Substitute to Company.  If, within such 60-day period, the Company has confirmed that the proposed Substitute is acceptable to the Company, then the Security Agent shall be entitled to effect a Permitted Transfer within a commercially reasonable period of time.  The Security Agent reserves all of its rights to exercise all of its legal, contractual, and equitable rights and remedies following the expiration of such 60-day consultation period in the event no proposed Substitute is acceptable to the Company; and
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			(g)      if the Security Agent, pursuant to a Permitted Transfer, exercises the power of sale or other disposal of a Drilling Unit under any Finance Document to the Substitute, the Company, subject to notice have been duly sent in accordance with 4(b) above, will not terminate the Drilling Contract or Drilling Contracts by reason solely of such transfer. In such circumstances, the Company agrees that the proposed Substitute shall, with effect from the date of the Permitted Transfer, become a party to the Drilling Contract in place of the Bareboat Charterer or become a party to a new contract on identical terms as the Drilling Contract and shall be treated for all purposes as if such Substitute had originally been named a party in place of the Bareboat Charterer (without prejudice to any accrued rights).
		

		
			5.           The terms of this Letter of Undertaking (including the Security Agent’s undertaking not to exercise any rights as mortgagee or affect in any manner the Company’s quiet and uninterrupted use of the Drilling Units as set out below) and any non-contractual obligations arising of it shall be governed by and construed in accordance with Norwegian law.  Disputes arising in connection with or as a result of this Letter of Undertaking (including a dispute regarding the existence, validity or termination of this Letter of Undertaking), and which are not resolved by mutual agreement, shall be settled by arbitration unless the parties agree otherwise. Any arbitration proceedings shall take place in Stavanger. The arbitral tribunal shall consist of three arbitrators who the parties shall jointly appoint. If the parties have not reached agreement on the composition of the arbitral tribunal within three weeks of the request for arbitration, the arbitral tribunal shall be appointed jointly by the chief judge of the Gulating court of appeal (NO: Gulating lagmannsrett). Otherwise, “Lov om voldgift” (lov av 14. mai 2004 nr. 25) (Act regarding procedural rules for Arbitration) shall apply.
		

		
			The Company hereby represents, warrants and agrees that it is generally subject to civil and commercial law and to legal proceedings and not entitled to claim immunity or privilege (sovereign or otherwise) from any set-off, judgment, execution, attachment or other legal process.
		

		
			- signature page follows below –
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			Please acknowledge your receipt of and your agreement to the terms of this Letter of Undertaking by signing it where indicated below.
		

		
			Yours faithfully,
		

		

		
			for and on behalf of
Equinor Energy AS
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			We, Wells Fargo Bank, National Association, in our capacity as Collateral Agent under the Indenture and not in our individual capacity, hereby confirm our agreement to the provisions of this Letter of Undertaking and acknowledge that we have reviewed a copy of each Drilling Contract and that we are fully aware of all its terms and conditions. In consideration of this undertaking and the Drilling Contracts, we irrevocably and unconditionally undertake to the Company and promise in respect of each Drilling Unit that, during the term of the relevant Drilling Contract and during the term of the Finance Documents, so long as (i) the Company retains any interest in the Drilling Contract and is not in material breach of its obligations thereunder and (ii) the Drilling Unit has not become subject to an actual, agreed, arranged or constructive total loss and is no longer available to the Owner, we shall not exercise any rights as mortgagee in relation to such Drilling Unit, including any rights to take possession, or otherwise enforce or seek to enforce such rights as we have at any time where such action may affect in any manner your quiet and uninterrupted use of such Drilling Unit in accordance with the terms of the Drilling Contract (excluding, for the avoidance of doubt, any steps to be taken to protect our rights in any arrest proceedings or other legal proceedings or applications for sale made against such Drilling Unit by any third parties).
		

		
			Dated:
		

		

		
			for and on behalf of
Wells Fargo Bank, National Association, as Collateral Agent
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			We, Songa Offshore Rig 3 AS, hereby confirm our agreement to the provisions of this Letter of Undertaking, and undertake to cooperate and provide all reasonable assistance as requested in order to effect a transfer of the Drilling Contract to the Substitute or the entry-into of a new contract between the Company and the Substitute as set out in paragraph 4 (c) and to execute all relevant agreements and/or other documents in respect of such transfer or new contract. Furthermore, we undertake in respect of any material default by us under the Drilling Contracts to give the Security Agent prompt notice of such default.
		

		
			Dated:
		

		

		
			for and on behalf of
Songa Offshore Rig 3 AS
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			APPENDIX L
		

		
			FORM OF DSRA WITHDRAWAL CERTIFICATE
		

		
			
		

		
			

		 

		

			Appendix L-1

		

 

		

			 

		

		

		
			TRANSOCEAN GUARDIAN LIMITED
		

		
			DSRA WITHDRAWAL CERTIFICATE
		

		
			PURSUANT TO SECTION 7.10 OF THE INDENTURE
		

		
			The undersigned, [ ___ ], as [ ___ ], of Transocean Guardian Limited, a Cayman Islands exempted company (the “Company”), pursuant to Section 7.10 of the indenture, dated as of July 13, 2018 (the “Indenture”), by and among the Company, the guarantors party thereto (the “Guarantors”) and Wells Fargo Bank, National Association, as trustee (in such capacity, the “Trustee”) and as collateral agent, HEREBY CERTIFIES, AUTHORIZES AND INSTRUCTS, for and on behalf of the Company, and without personal liability, as follows:
		

		
			1.         The amount on deposit in the Debt Service Reserve Account exceeds the Debt Service Reserve by $[ __ ]. Pursuant to this Withdrawal Certificate, the Company instructs the Trustee to withdraw and transfer $[ __ ] (the “Subject Amount”).1
		

		
			2.         The Company hereby authorizes and instructs the Trustee to withdraw and transfer to the Company by wire transfer to the account below the Subject Amount on deposit in the Debt Service Reserve Account.
		

		
			Bank Name: 
Bank Address: 
Beneficiary: 
ABA No.: 
Account No.: 
Swift Code:
		

		
			3.         The undersigned has read the Indenture, including Section 7.10 of the Indenture, and the Security Documents.
		

		
			4.         The statements made in this Withdrawal Certificate are based upon, among other things, an examination of the Securities, the Indenture and the Security Documents, upon the general knowledge of the undersigned and familiarity of the undersigned of the operations of the Company, upon performance of the duties of the undersigned as an officer of the Company and consultation with counsel of the requirements of the Indenture and the Security Documents in respect of the legal matters relating to the Subject Amount, the Debt Service Reserve Account, the Debt Service Reserve and Section 7.10 of the Indenture.
		

		
			5.         In the opinion of the undersigned, the undersigned has made such examination or investigation as is necessary to enable the undersigned to express an informed opinion as to whether or not the Company has complied with all conditions precedent and covenants
		

		

		
			1      To be less than or equal to the amount by which the amount on deposit in the the Debt Service Reserve Account exceeds the Debt Service Reserve.
		

		
			
		

		
			

		 

		

			Appendix L-2

		

 

		

			 

		

		

		
			relating to the withdrawal of the Subject Amount from the Debt Service Reserve Account.
		

		
			6.         With respect to the foregoing, the undersigned certifies for and on behalf of the Company that, in the opinion of the undersigned, the Company has complied with all conditions precedent and covenants provided for in the Indenture and the Security Documents, if any, relating to the withdrawal and transfer of the Subject Amount from the Debt Service Reserve Account as described herein.
		

		
			Capitalized terms used but not otherwise defined herein shall have the same meanings ascribed to such terms in the Indenture.
		

		
			IN WITNESS WHEREOF, the undersigned has duly executed this Withdrawal Certificate.
		

			
					
						Dated: [           ]

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						TRANSOCEAN GUARDIAN LIMITED

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

				
	
					
						 

					
					
						Title:

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix L-3

		

 

		

			 

		

		

		
			APPENDIX M
		

		
			FORM OF ACCOUNT PLEDGE AGREEMENT
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix M-1

		

 

		

			 

		

		

		
			
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			SONGA OFFSHORE RIG 3 AS
		

		
			as Chargor
		

		
			 
		

		
			 
		

		
			in favour of
		

		
			 
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION
		

		
			as Collateral Agent for the Secured Creditors
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			RESTRICTED BOND AND FLOATING CHARGE AND ASSIGNATION
		

		
			 
		

		
			[ENABLER/ENCOURAGE]
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			Table Of Contents
		

		
			 
		

			
					
						Clause

					
					
						Page No.

				
	
					
						1

					
					
						DEFINITIONS AND INTERPRETATION

					
1
				
	
					
						2

					
					
						BOND

					
3
				
	
					
						3

					
					
						FLOATING CHARGE

					
3
				
	
					
						4

					
					
						ASSIGNATION IN SECURITY

					
3
				
	
					
						5

					
					
						LIMITATIONS

					
4
				
	
					
						6

					
					
						PERFECTION OF ASSIGNATION IN SECURITY

					
4
				
	
					
						7

					
					
						RANKING OF FLOATING CHARGE

					
4
				
	
					
						8

					
					
						OPERATION OF CHARGED ACCOUNTS

					
4
				
	
					
						9

					
					
						UNDERTAKINGS

					
5
				
	
					
						10

					
					
						SET-OFF

					
5
				
	
					
						11

					
					
						ENFORCEMENT

					
5
				
	
					
						12

					
					
						OFFICE OF RECEIVER

					
7
				
	
					
						13

					
					
						APPLICATION OF ENFORCEMENT PROCEEDS

					
8
				
	
					
						14

					
					
						PROTECTION OF SECURITY

					
8
				
	
					
						15

					
					
						FURTHER ASSURANCE

					
10
				
	
					
						16

					
					
						MANDATE AND ATTORNEY

					
10
				
	
					
						17

					
					
						EXPENSES AND INDEMNITY

					
11
				
	
					
						18

					
					
						ASSIGNATION BY THE COLLATERAL AGENT

					
11
				
	
					
						19

					
					
						NOTICES

					
11
				
	
					
						20

					
					
						GOVERNING LAW AND JURISDICTION

					
11
				
	
					
						21

					
					
						DISCHARGE OF SECURITY

					
11
				
	
					
						22

					
					
						CONSENT TO REGISTRATION

					
12
				
	
					
						 

					
					
						SCHEDULE

					
14
				
	
					
						 

					
					
						PART 1 - CHARGED ACCOUNTS

					
14
				
	
					
						 

					
					
						PART 2 – NOTICE OF CHARGE

					
15
				
	
					
						 

					
					
						PART 3 – ACKNOWLEDGEMENT OF CHARGE

					
17
				

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			For the purposes of the Legal Writings (Counterparts and Delivery) (Scotland) Act 2015, this Instrument is delivered on __________________________.
		

		
			BOND AND FLOATING CHARGE AND ASSIGNATION
		

		
			by
		

		
			(1)            SONGA OFFSHORE RIG 3 AS, a private limited liability company organised under the laws of Norway with registered number 913 292 073 and having its registered office at Maskinveien 26, N-4033 Stavanger, Norway (the “Chargor”)
		

		
			in favour of
		

		
			(2)            WELLS FARGO BANK, NATIONAL ASSOCIATION as collateral agent for each of the Secured Creditors on the terms and conditions set out in the Indenture (as defined below) (the “Collateral Agent”)
		

		
			CONSIDERING THAT:
		

		
			(A)           the Collateral Agent has agreed to act as collateral agent under the Indenture;
		

		
			(B)           one of the conditions to completion of the Indenture is that the Chargor grants to the Collateral Agent this restricted bond and floating charge and assignation.
		

		
			NOW IT IS HEREBY AGREED AND DECLARED as follows:
		

		
			1              DEFINITIONS AND INTERPRETATION
		

		
			1.1           In this Instrument:
		

		
			“Account Bank” means Lloyds Bank plc at its offices at 3-5 Albyn Place, Aberdeen, AB10 1PY, Scotland;
		

		
			“Administrator” means any administrator appointed pursuant to this Instrument;
		

		
			“Blocked Period” has the meaning given to that term in Section 4.15 (Total Leverage Ratio) of the Indenture;
		

		
			“Charged Accounts” means each of the accounts maintained by the Chargor with the Account Bank specified in Part 1 of the Schedule and includes:
		

		
			(a)            if there is a change of Account Bank, any account into which all or part of a credit balance from a Charged Account is transferred; and
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			(b)           any account which is a successor to a Charged Account on any re-numbering or re-designation of accounts;
		

		
			“Event of Default” has the meaning given to it in the Indenture;
		

		
			“Indenture” means an indenture dated 13 July 2018 between, amongst others, Transocean Guardian Limited as issuer, the Guarantors party thereto and Wells Fargo Bank, National Association, as trustee and as collateral agent in respect of 5.875% senior secured notes due 2024;
		

		
			“Receiver” means any receiver or administrative receiver appointed in respect of the Charged Accounts (whether pursuant to this Instrument, pursuant to any statute, by a court or otherwise) and includes joint receivers; and
		

		
			“Secured Liabilities” has the meaning given to Notes Obligations in the Indenture.
		

		
			1.2           Construction
		

		
			1.2.1        Capitalised terms defined in the Indenture have, unless expressly defined in this Instrument, the same meaning in this Instrument.
		

		
			1.2.2        Unless a contrary indication appears, any reference in this Instrument to:
		

		
			(a)           the “Chargor” and the “Collateral Agent” shall be construed so as to include their respective successors in title, permitted assignees and permitted transferees and each is a “Party” to this Instrument; and
		

		
			(b)           a “person” includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium or partnership (whether or not having separate legal personality).
		

		
			1.2.3        The Indenture includes (without prejudice to any prohibition on amendments) all amendments however fundamental to the Indenture.
		

		
			1.2.4        The term this “Security” means any security created by this Instrument and “Party” means any party to this Instrument.
		

		
			1.2.5        A reference to any asset, unless the context otherwise requires, includes any present and future asset.
		

		
			1.2.6        If the Collateral Agent considers that an amount paid to it or a Receiver is capable of being avoided or otherwise set aside on the liquidation or administration of the payer or otherwise, then that amount will not be considered to have been irrevocably paid for the purposes of this Instrument.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			1.2.7        Unless the context otherwise requires, a reference to a Charged Account includes the proceeds of sale of that Charged Account.
		

		
			1.3          Third party rights
		

		
			1.3.1        Unless expressly provided to the contrary in the Indenture, this Instrument does not confer on any person who is not a Party (other than any Administrator or Receiver) any right to enforce or otherwise invoke this Instrument or any part of it under the Contract (Third Party Rights) (Scotland) Act 2017.
		

		
			1.3.2        Notwithstanding any term of the Indenture, the consent of any person who is not a Party is not required to rescind or vary this Instrument at any time.
		

		
			2              BOND
		

		
			2.1           Subject to Clause 2.2 below, the Chargor undertakes to the Collateral Agent for itself and as trustee for the Secured Creditors that it will pay or discharge to the Collateral Agent all the Secured Liabilities on demand in writing when the Secured Liabilities become due for payment or discharge (whether by acceleration or otherwise).
		

		
			2.2           Notwithstanding any other provision of this Instrument, the Collateral Agent hereby acknowledges and agrees with the Chargor that the only recourse that the Collateral Agent shall have against the Chargor in respect of the Secured Liabilities pursuant to the undertaking contained in Clause 2.1 will be against the Charged Accounts and/or any proceeds of sale or other realisation thereof.
		

		
			2.3           Paragraph 14 of Schedule B1 to the Insolvency Act (incorporated by Schedule 16 to the Enterprise Act 2002) shall apply to this Instrument which is accordingly a qualifying floating charge.  Notwithstanding any other provision of this Instrument, the Chargor and the Collateral Agent agree and acknowledge that an Administrator may only be appointed if the Chargor is a “company” within the meaning of paragraph 111 of Schedule B1 to the Insolvency Act and that a Receiver may only be appointed if the Chargor falls within the terms of section 51 of the Insolvency Act but the Instrument falls outside the terms of section 72A of the Insolvency Act.
		

		
			3              FLOATING CHARGE
		

		
			The Chargor as security for the payment and discharge of all the Secured Liabilities hereby grants in favour of the Collateral Agent a floating charge over the Charged Accounts.
		

		
			4              ASSIGNATION IN SECURITY
		

		
			The Chargor as security for the payment and discharge of all the Secured Liabilities hereby pledges and assigns to the Collateral Agent all its right, title and interest (present and future) in
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			and to the Charged Accounts, the monies standing to the credit of the Charged Accounts and the debts represented thereby.
		

		
			5              LIMITATIONS
		

		
			5.1           For the purpose of the Security, the Secured Liabilities shall be limited to USD 1,800,000,000.
		

		
			5.2           The obligations of the Chargor under this Instrument will be limited, subject to Clause 5.3 below, by mandatory provisions of law applicable to the Chargor limiting the legal capacity or ability of the Chargor to provide security under this Instrument (including, but not limited to, the provisions of Sections 8-7 and 8-10, cf. 1-3 and 1-4 of the Norwegian Limited Liability Companies Act of 1997), regulating unlawful financial assistance and other prohibited loans, guarantees and joint and several liability as well as providing of security.
		

		
			5.3           If any limitation herein is no longer applicable as a mandatory provision under Norwegian law, that limitation will no longer apply to the security provided under this Instrument.
		

		
			6              PERFECTION OF ASSIGNATION IN SECURITY
		

		
			6.1           Immediately upon execution of this Charge, the Chargor shall deliver a duly completed intimation of assignation in respect of the Charged Accounts to the Account Bank in the form set out in Part 2 of the Schedule (Intimation of Assignation) and shall provide the Collateral Agent with such evidence of intimation and shall use all reasonable endeavours to procure that the Account Bank executes and delivers to the Collateral Agent an acknowledgement in the form set out in Part 3 of the Schedule (Acknowledgement of Intimation) (or in such other substantially similar form).
		

		
			7              RANKING OF FLOATING CHARGE
		

		
			7.1           The fixed security granted by the Chargor pursuant to Clause Error! Reference source not found. (Assignation in Security) and any other fixed security granted by the Chargor in favour of the Collateral Agent (whether before or after the date of execution of this Instrument) shall rank in priority to the floating charge created by Clause 3 (Floating Charge).
		

		
			8              OPERATION OF CHARGED ACCOUNTS
		

		
			8.1           Interest
		

		
			All interest accruing on any amounts from time to time standing to the credit of a Charged Account shall be credited to that Charged Account.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			8.2           Restrictions on termination
		

		
			Unless not otherwise prohibited by the Indenture or as set out in Clause 21, the Chargor will not agree to alter the terms of, or terminate, or otherwise assign or dispose of any Charged Account or waive its rights under a Charged Account.
		

		
			8.3           Operation of Charged Accounts
		

		
			Prior to the Collateral Agent taking enforcement action pursuant to Clause 11 or at any time during a Blocked Period, the Chargor may make any payments into or withdrawals from the Charged Accounts.
		

		
			8.4           Blocked Period
		

		
			Upon the occurrence of and during a Blocked Period, the Chargor shall operate the Charged Accounts in accordance with the terms of the Indenture.
		

		
			9              UNDERTAKINGS
		

		
			The Chargor will:
		

		
			9.1           notify the Collateral Agent promptly in the event of any creditor exercising diligence against it or any of the Charged Accounts wherever situated or taking any steps which might be expected to lead thereto; and
		

		
			9.2           comply in all material respects with the mandates in relation to the Charged Accounts.
		

		
			10            SET-OFF
		

		
			Without prejudice to any of its other rights, remedies or powers, the Collateral Agent shall, whilst an Event of Default is continuing, be entitled to hold all sums which are now or which may at any time hereafter be at the credit of any account or accounts in the name of the Chargor with the Collateral Agent as security for the Secured Liabilities and to apply without notice to the Chargor any such sums in and towards discharge of the Secured Liabilities in accordance with the Indenture.  The Collateral Agent shall not be obliged to exercise its rights under this Clause 10, which shall be without prejudice and in addition to any right of set-off, compensation, combination of accounts, lien or other right to which it is at any time otherwise entitled (whether by operation of law, contract or otherwise).
		

		
			11            ENFORCEMENT
		

		
			11.1         In addition to any statutory provisions concerning enforceability or attachment, the security created by this Instrument shall become enforceable upon and the Collateral Agent’s powers of appointment and other rights and powers shall become exercisable at any time after the occurrence and during the continuation of an Event of Default and the Collateral Agent may:
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			11.1.1      in respect of the floating charge created by Clause 3 (Floating Charge), then (or as soon thereafter as permitted by law) by instrument in writing appoint any person or persons (if more than one with power to act both jointly and separately) to be an administrator of the Chargor or (subject, if applicable, to Section 72A of the Insolvency Act 1986) a receiver of the Charged Accounts.  In addition, and without prejudice to the foregoing provisions of this Clause 11.1.1, in the event that any person appointed to be a Receiver shall be removed by a court or shall otherwise cease to act as such, then the Collateral Agent shall be entitled so to appoint another person as Receiver in his place; and
		

		
			11.1.2      enforce all or any part of the security created by the assignation created by Clause 4 (Assignation in Security), in any manner it sees fit and may without prior notice to the Chargor:
		

		
			(a)            exercise a right of set-off, compensation or retention in respect of all or any amounts now or at any time hereafter standing to the credit of any Charged Account against; and/or
		

		
			(b)           apply or require the Account Bank to apply all or any amounts now or at any time hereafter standing to the credit of any Charged Account in satisfaction of; and/or
		

		
			(c)            all or any amounts which may now or at any time hereafter be due and payable by the Chargor to the Collateral Agent in respect of the Secured Liabilities;
		

		
			11.1.3      exercise all the rights and powers relating to the Charged Accounts and generally act in relation to the Charged Accounts in such manner as if it were the absolute owner thereof
		

		
			11.2         Subject to the Collateral Agent being entitled to appoint an Administrator in accordance with Section 11.1.2 above, an Administrator shall have and be entitled to exercise, in addition to and without limiting all the powers of an administrator under the Insolvency Act 1986, all the powers of a receiver under Schedule 2 of the Insolvency Act 1986 and a Receiver shall have and be entitled to exercise, in addition to and without limiting all the powers of a receiver under Schedule 2 of the Insolvency Act 1986, all the powers of an administrative receiver set out in Schedule 1 of the Insolvency Act 1986 together with (in either case) the power to exercise any powers or rights incidental to ownership of the Charged Accounts, including (as regards shares and other securities) any voting rights or rights of enforcing the same together with power to:
		

		
			11.2.1      implement and exercise all or any of the Chargor’s powers and/or rights and/or obligations under any contract or other agreement forming a part of the Charged Accounts;
		

		
			11.2.2      make any arrangement or compromise which he shall think expedient of or in respect of any claim by or against the Chargor in respect of the Charged Accounts;
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			11.2.3      do all such other acts and things as he may consider necessary for protecting or realising the Charged Accounts, or any part thereof, or incidental or conducive to any of the matters, powers or authorities conferred on a Receiver under or by virtue of or pursuant to this Instrument and exercise in relation to the Charged Accounts, or any part thereof, all such powers and authorities and do all such things as he would be capable of exercising or doing if he were the absolute beneficial owner of the same and use the name of the Chargor for all and any of the purposes aforesaid,
		

		
			subject always to the rights of the Collateral Agent as holder of this Security.
		

		
			11.3         To the extent that any of the Charged Accounts constitutes “financial collateral” and this Instrument and the obligations of the Chargor hereunder constitute a “security financial collateral arrangement” (in each case as defined in, and for the purposes of, the Financial Collateral Arrangements (No. 2) Regulations 2003 (SI 2003 No. 3226) (the “Regulations”) the Collateral Agent shall have the right to appropriate all or any part of such financial collateral in or towards discharge of the Secured Liabilities and may exercise such right to appropriate upon giving written notice to the Chargor.  For this purpose, the parties agree that the value of such financial collateral so appropriated shall be (a) in the case of cash, the amount standing to the credit of each of the relevant accounts, together with any accrued but unposted interest, at the time the right of appropriation is exercised; and (b) in the case of any shares, stocks, debentures, bonds or other securities or investments, the market price of such shares, stocks, debentures, bonds or other securities or investments determined by the Collateral Agent by reference to a public index or by such other process as the Collateral Agent may select, including independent valuation.  In each case, the parties agree that the method of valuation provided for in this Instrument shall constitute a commercially reasonable method of valuation for the purposes of the Regulations.
		

		
			12            OFFICE OF RECEIVER
		

		
			12.1         Any Receiver appointed under Clause 11 (Enforcement) shall be the agent of the Chargor for all purposes and (subject to the provisions of the Insolvency Act 1986) the Chargor alone shall be responsible (other than where there is wilful misconduct or gross negligence) for his contracts, engagements, acts, omissions, defaults and losses and for liabilities incurred by him and for his remuneration and his reasonable costs, charges and expenses and the Collateral Agent shall not incur any liability for those (either to the Chargor or any other person) by reason of the Collateral Agent making his appointment as such Receiver or for any other reason whatsoever.
		

		
			12.2         Any Receiver appointed under Clause 11 (Enforcement) shall be entitled to remuneration for his services and the services of his firm appropriate to the responsibilities involved.  Subject to Section 58 of the Insolvency Act 1986, the remuneration of the Receiver may be fixed by the Collateral Agent (and may be or include a commission calculated by reference to the gross amount of all money received or otherwise and may include remuneration in connection with claims, actions or proceedings made or brought against the Receiver by the Chargor or any other person or the performance or discharge of any obligation imposed upon him by statute or otherwise) but
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			such remuneration shall be payable by the Chargor alone and the amount of such remuneration shall form part of the Secured Liabilities and accordingly be secured on the Charged Accounts under the floating charge constituted by this Instrument.
		

		
			13            APPLICATION OF ENFORCEMENT PROCEEDS
		

		
			13.1         All monies received by the Collateral Agent or any Receiver under or by virtue of this Instrument following enforcement of the security hereby granted or of any security interest constituted pursuant hereto shall be applied in accordance with the Indenture.
		

		
			13.2         Nothing contained in this Instrument shall limit the right of the Receiver or the Collateral Agent (and the Chargor acknowledges that the Receiver and the Collateral Agent are so entitled) if and for so long as the Receiver or the Collateral Agent, in their discretion, shall consider it appropriate, to place all or any monies arising from the enforcement of the security interest hereby granted or any security created pursuant to this Instrument into a suspense account, without any obligation to apply the same or any part thereof in or towards the discharge of any of the Secured Liabilities.
		

		
			14            PROTECTION OF SECURITY
		

		
			14.1         The security created by and any security interest constituted pursuant to this Instrument shall be a continuing security notwithstanding any settlement of account or other matter or thing whatsoever and in particular (but without prejudice to the generality of the foregoing) shall not be considered satisfied by an intermediate repayment or satisfaction of part only of the Secured Liabilities and shall continue in full force and effect until total and irrevocable satisfaction of all the Secured Liabilities.
		

		
			14.2         The security created by and any security interest constituted pursuant to this Instrument shall be in addition to and shall not in any way prejudice or be prejudiced by any collateral or other security, right or remedy which the Collateral Agent may now or at any time hereafter hold for all or any part of the Secured Liabilities.
		

		
			14.3         No failure on the part of the Collateral Agent to exercise and no delay on its part in exercising any right, remedy, power or privilege under or pursuant to this Instrument or any other document relating to or securing all or any part of the Secured Liabilities will operate as a waiver thereof, nor will any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy.  The rights and remedies provided in this Instrument and any such other document are cumulative and not exclusive of any right or remedies provided by law.
		

		
			14.4         Each of the provisions in this Instrument shall be severable and distinct from one another and if at any time any one or more of such provisions is or becomes or is declared null and void, invalid, illegal or unenforceable in any respect under any law or otherwise howsoever, the validity, legality
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			and enforceability of the remaining provisions of this Instrument shall not in any way be affected or impaired by that occurrence.
		

		
			14.5         If the Collateral Agent receives or is deemed to be affected by notice, whether actual or constructive, of any subsequent security or other interest affecting any part of the Charged Accounts and/or the proceeds of sale(s) thereof, the Collateral Agent may (but shall not be obligated to) open a new account or accounts in the name of the Chargor.  If the Collateral Agent does not open a new account or accounts, it shall nevertheless be treated as if it had done so at the time when it receives or was deemed to have received notice and as from that time, all payments made to the Collateral Agent shall be credited or be treated as having been credited to the new account or accounts and shall not operate to reduce the amount for which this Instrument is security.
		

		
			14.6         Neither the security created by, nor any security interest constituted pursuant to, this Instrument nor the rights, powers, discretions and remedies conferred upon the Collateral Agent by this Instrument or by law shall be discharged, impaired or otherwise affected by reason of:
		

		
			14.6.1      any present or future security, guarantee, indemnity or other right or remedy held by or available to the Collateral Agent being or becoming wholly or in part void, voidable or unenforceable on any ground whatsoever or by the Collateral Agent from time to time exchanging, varying, realising, releasing or failing to perfect or enforce any of the same; or
		

		
			14.6.2      the Collateral Agent compounding with, discharging or releasing or varying the liability of, or granting any time, indulgence or concession to, the Chargor or any other person or renewing, determining, varying or increasing any accommodation or transaction in any manner whatsoever or concurring in accepting or varying any compromise, arrangement or settlement or omitting to claim or enforce payment from the Chargor or any other person; or
		

		
			14.6.3      any act or omission which would not have discharged or affected the liability of the Chargor had it been a principal debtor instead of cautioner or by anything done or omitted which but for this provision might operate to exonerate the Chargor from the Secured Liabilities; or
		

		
			14.6.4      any legal limitation, disability, incapacity or other similar circumstance relating to the Chargor.
		

		
			14.7         The Collateral Agent shall not be obliged, before exercising any of the rights, powers or remedies conferred upon it by or pursuant to this Instrument or by law, to:
		

		
			14.7.1      take any action or obtain judgement or decree in any court against the Chargor; or
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			14.7.2      make or file any claim to rank in a winding-up or liquidation of the Chargor; or
		

		
			14.7.3      enforce or seek to enforce any other security taken, or exercise any right or plea available to the Collateral Agent, in respect of any of the Chargor’s obligations under the Indenture.
		

		
			15            FURTHER ASSURANCE
		

		
			The Chargor shall execute and do all such assurances, acts and things reasonably required for perfecting or protecting the security created by or pursuant to this Instrument over the Charged Accounts or, when an Event of Default has occurred and is continuing, for facilitating the realisation of such assets and the exercise of all powers, authorities and discretions conferred on the Collateral Agent or on any Receiver by this Instrument and shall in particular after being reasonably requested to do so by the Collateral Agent or any Receiver, execute all assignations and transfers (in favour of the Collateral Agent or any Receiver or to such nominee as either shall direct) of the Charged Accounts which come into existence after the date of this Instrument and give all notices orders and directions necessary for the purposes specified in this Clause 15. The Collateral Agent shall be entitled (i) to receive all the benefits, indemnities, powers, privileges, protections and rights contained in the Indenture, (ii) to receive an Officer’s Certificate and an Opinion of Counsel in accordance with Section 14.02 of the Indenture, and (iii) to act with the consent of the requisite Holders as provided in the Indenture, in each case in connection with acting in its capacity as Collateral Agent hereunder.
		

		
			16            MANDATE AND ATTORNEY
		

		
			16.1         The Chargor hereby irrevocably appoints the Collateral Agent and any Receiver to be its mandatary and attorney for it and on its behalf and in its name or otherwise and as such, if the Chargor has failed to perform an obligation under this Instrument, within 10 Business Days of written request of the Collateral Agent, to create or constitute any deed, or to make any alteration or addition or deletion in or to, any documents which are necessary for perfecting or protecting the title of the Collateral Agent or the Receiver to the Charged Accounts or for vesting any of the Charged Accounts in the Collateral Agent or the Receiver or its nominees or any purchaser and to re-deliver the same thereafter and otherwise to sign, seal and deliver and perfect any security, floating charge, transfer, disposition, assignation, security and/or assurance or any writing, assurance, document or act which may be required or is necessary in connection with any sale, lease, disposition, realisation, getting in or other enforcement by the Collateral Agent or the Receiver of all or any of the Charged Accounts.
		

		
			16.2         The Chargor hereby ratifies and confirms and agrees to ratify and confirm any acts such mandatary or attorney shall do (other than where there is wilful misconduct or gross negligence) in the exercise or purported exercise of all or any of the powers, authorities and discretions referred to in this Clause 16.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			17            EXPENSES AND INDEMNITY
		

		
			The Chargor must within 10 Business Days of demand pay all reasonable and documented costs and expenses (including legal fees) incurred in connection with this Instrument by the Collateral Agent or other person appointed by the Collateral Agent under this Instrument.
		

		
			18            ASSIGNATION BY THE COLLATERAL AGENT
		

		
			The Collateral Agent may assign and transfer all of its rights and obligations under this Instrument to a replacement Collateral Agent appointed in accordance with the terms of the Indenture.  Upon such assignation and transfer taking effect, the replacement Collateral Agent shall be and be deemed to be acting for itself and as trustee for the Secured Creditors for the purposes of this Instrument in place of the previous Collateral Agent
		

		
			19            NOTICES
		

		
			All notices, requests, demands and other communications to be given under this Instrument shall be given and/or be deemed to be given in the same manner as notices to be given under the Indenture and the terms of Section 14.01 (Notices) of the Indenture shall apply mutatis mutandis to this Instrument as though that clause were set out in full in this Instrument.
		

		
			20            GOVERNING LAW AND JURISDICTION
		

		
			This Instrument shall be governed by, and construed in all respects in accordance with, the law of Scotland and, for the benefit of the Collateral Agent, the Chargor irrevocably submits to the non-exclusive jurisdiction of the Scottish courts but without prejudice to the ability of the Collateral Agent to proceed against the Chargor in any other appropriate jurisdiction.
		

		
			21            DISCHARGE OF SECURITY
		

		
			This Instrument and the security interest granted hereunder shall automatically terminate and be released upon (i) the occurrence of any of the events described in clauses (a) and (b) of Section 12.02 (Release of Collateral) of the Indenture and the satisfaction of any conditions precedent set forth therein, (ii) consent of the requisite Holders in accordance with Section 10.02 and 12.02 of the Indenture, (iii) (x) the replacement of the Chargor as a “Collateral Rig Operator” in accordance with (a) a fundamental change of the Charger not prohibited by Section 4.13 or Section 4.29 of the Indenture and/or (b) a transaction permitted by Section 4.27 and 4.29 of the Indenture, as applicable, and (y) to the extent required by the Indenture, the entry into a new Instrument as required by the Indenture or (iv) the occurrence of any events described in clause (e) of Section 12.02 of the Indenture.
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			22            CONSENT TO REGISTRATION
		

		
			A certificate signed by any official, manager or equivalent account officer of the Collateral Agent shall, in the absence of manifest error, conclusively determine the Secured Liabilities at any relevant time and shall constitute a balance and charge against the Chargor, and no suspension of a charge or of a threatened charge for payment of the balance so constituted shall pass nor any sist of execution thereon be granted except on consignation.  The Chargor hereby consents to the registration of this Instrument and of any such certificate for preservation and execution: IN WITNESS WHEREOF these presents consisting of this and the preceding [  ] pages are executed as follows and delivered for the purposes of the Legal Writings (Counterparts and Delivery) (Scotland) Act 2015 on the date set out on page 1 of this Instrument:
		

		
			THE CHARGOR
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						SUBSCRIBED for and on behalf of the said SONGA OFFSHORE RIG 3 AS

					
						at

					
						on

					
						by

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Print Full name

					
					
						 

					
					
						Director

				
	
					
						before this witness:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Print Full Name

					
					
						 

					
					
						Witness

				
	
					
						Address:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			COLLATERAL AGENT
		

			
					
						SUBSCRIBED for and on behalf of the said WELLS FARGO BANK, NATIONAL ASSOCIATION

					
						at

					
						on

					
						by

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Print Full name

					
					
						 

					
					
						Director

				
	
					
						before this witness:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Print Full Name

					
					
						 

					
					
						Witness

				
	
					
						Address:

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			This is the Schedule referred to in the foregoing Restricted Bond and Floating Charge and Assignation between Songa Offshore Rig 3 AS and Wells Fargo Bank, National Association as Collateral Agent dated 13 July 2018 and delivered on 13 July 2018
		

		
			Article 12 SCHEDULE
		

		
			PART 1 - CHARGED ACCOUNTS
		

		
			[ENABLER]
		

			
					
						Account Name

					
					
						Account Number

					
					
						Sort Code

				
	
					
						Songa Offshore Rig 3 AS

					
						(Enabler USD)

					
					
						11839209

					
					
						30-96-34

				
	
					
						Songa Offshore Rig 3 AS

					
						(Enabler NOK)

					
					
						30011574

					
					
						30-96-34

				

		
			 
		

		
			 
		

		
			[ENCOURAGE]
		

			
					
						Account Name

					
					
						Account Number

					
					
						Sort Code

				
	
					
						Songa Offshore Rig 3 AS

					
						(Encourage USD)

					
					
						11822756

					
					
						30-96-34

				
	
					
						Songa Offshore Rig 3 AS

					
						(Encourage USD)

					
					
						30011582

					
					
						30-96-34

				

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			PART 2 –  INTIMATION OF ASSIGNATION
		

		
			To:        [  ] (as “Account Bank”)
		

		
			Date:     [   ]
		

		
			Dear Sirs,
		

		
			We give you notice that, by a restricted bond and floating charge and assignation dated July 13, 2018, we pledged and assigned to Wells Fargo Bank, National Association (the “Collateral Agent”) all our right, title and interest (present and future)  in the accounts maintained by us with you as set out below, including any amount standing to the credit of such accounts maintained by us with you as set out below (each a “Charged Account”) and the debt represented by it.
		

		
			We have agreed with the Collateral Agent not to close a Charged Account or to amend or waive any of its terms without the consent of the Collateral Agent.
		

		
			We irrevocably instruct and authorise you to:
		

		
			1              disclose to the Collateral Agent any information relating to a Charged Account requested from you by the Collateral Agent; and
		

		
			2              comply with the terms of any written notice or instruction relating to a Charged Account received by you from the Collateral Agent;
		

		
			provided that you may continue to operate the Charged Accounts in accordance with our instructions until such time as the Collateral Agent directs you otherwise.
		

		
			We acknowledge that you may comply with the instructions in this letter without any further permission from us or enquiry by you.
		

		
			The instructions in this letter may not be revoked or amended without the prior written consent of the Collateral Agent
		

		
			This letter and any non-contractual obligations connected with it are governed by and will be construed in accordance with the laws of Scotland.
		

		
			Would you please confirm your agreement to the above by sending the enclosed acknowledgement to the Collateral Agent with a copy to ourselves.
		

		
			Yours faithfully
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		

		
			for and on behalf of [  ] Limited
		

		
			 
		

		
			 
		

		
			Charged Accounts
		

		
			1              [  ] Limited [  ] Account, Account Number [  ], Sort Code [  ]; and
		

		
			2           [  ] Limited [  ] Account, Account Number [  ], Sort Code [  ].
		

		
			
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			PART 3 – ACKNOWLEDGEMENT OF ASSIGNATION
		

		
			To:        Wells Fargo Bank, National Association as Collateral Agent
		

		
			Date:     [   ]
		

		
			Dear Sirs,
		

		
			We confirm receipt from Songa Offshore Rig 3 AS (the “Chargor”) of an intimation dated [  ] of a restricted bond and floating charge and assignation dated July 13, 2018, in favour of Wells Fargo Bank, National Association (the “Collateral Agent”) over all the rights of the Chargor to any amount standing to the credit of its accounts with us (each a “Charged Account”) and the debt represented by it.
		

		
			We confirm that we:
		

		
			1              accept the instructions contained in the notice and agree to comply with the intimation;
		

		
			2              have not received notice of the interest of any third party in any Charged Account; and
		

		
			3              have neither claimed nor exercised, nor will claim or exercise, any security interest, set-off, counter-claim or other right in respect of any Charged Account.
		

		
			This letter and any non-contractual obligations connected with it are governed by and will be construed in accordance with the laws of Scotland.
		

		
			Yours faithfully
		

		
			____________________________ (Authorised signatory)
		

		
			[   ] (as Account Bank)
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			APPENDIX N
		

		
			FORM OF SECURITY PROCEDURES CERTIFICATE
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix N-1

		

 

		

			 

		

		

		
			TRANSOCEAN GUARDIAN LIMITED
		

		
			SECURITY PROCEDURES CERTIFICATE
		

		
			PURSUANT TO SECTION 7.10 OF THE INDENTURE
		

		
			I hereby certify that I am authorized to deliver this Certificate on behalf of Transocean Guardian Limited (the “Company”), and hereby further certify that the names, titles, telephone numbers, email addresses and specimen signatures set forth below identify the persons authorized to provide direction and initiate or confirm transactions, including funds transfer instructions, on behalf of the Company, and that the option checked in Part C of this Certificate is the security procedure selected by the Company for use in verifying that a funds transfer instruction received by the Trustee is that of the Company.
		

		
			The Company has reviewed each of these security procedures and has determined that the option checked in Part C of this Certificate best meets its requirements; given the size, type and frequency of the instructions it will issue to the Trustee. By selecting the security procedure specified in Part C of this Certificate, the Company acknowledges that it has elected to not use the other security procedures described below and agrees to be bound by any funds transfer instruction, whether or not authorized, issued in its name and accepted by the Trustee in compliance with the particular security procedure chosen by the Company.
		

		
			NOTICE: The security procedure selected by the Company will not be used to detect errors in the funds transfer instructions given by the Company. If a funds transfer instruction describes the beneficiary of the payment inconsistently by name and account number, payment may be made on the basis of the account number even if it identifies a person different from the named beneficiary. If a funds transfer instruction describes a participating financial institution inconsistently by name and identification number, the identification number may be relied upon as the proper identification of the financial institution. Therefore, it is important that the Company take such steps as it deems prudent to ensure that there are no such inconsistencies in the funds transfer instructions it sends to the Trustee.
		

		
			IN WITNESS WHEREOF, the undersigned has duly executed this Officer’s Certificate.
		

		
			Dated: [           ]
		

			
					
						 

					
					
						TRANSOCEAN GUARDIAN LIMITED

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix N-2

		

 

		

			 

		

		

		
			Part A
		

		
			Name, Title, Telephone Number, Email Address and Specimen Signature
		

		
			for person(s) designated to provide direction, including but not limited to funds transfer
		

		
			instructions, and to otherwise act on behalf of the Company
		

			
					
						Name

					
					
						    

					
					
						Title

					
					
						    

					
					
						Telephone Number

					
					
						    

					
					
						Email Address

					
					
						    

					
					
						Specimen Signature

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						[list more if desired]

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			 
		

		
			Part B
		

		
			Name, Title, Telephone Number and Email Address for
		

		
			person(s) designated to confirm funds transfer instructions
		

			
					
						Name

					
					
						    

					
					
						Title

					
					
						    

					
					
						Telephone Number

					
					
						    

					
					
						Email Address

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						[list more if desired]

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

			 

		

		

		
			Part C
		

		
			Means for delivery of instructions and/or confirmations
		

		
			The security procedure to be used with respect to funds transfer instructions is checked below:
		

		
			☐          Option 1. Confirmation by telephone call-back. The Trustee shall confirm funds transfer instructions by telephone call-back to a person at the telephone number designated on Part B above. The person confirming the funds transfer instruction shall be a person other than the person from whom the funds transfer instruction was received, unless only one person is designated in both Parts A and B of this Certificate.
		

		
			☐    CHECK box, if applicable:
		

		
			If the Trustee is unable to obtain confirmation by telephone call-back, the Trustee may, at its discretion, confirm by email, as described in Option 2.
		

		
			☐          Option 2. Confirmation by email. The Trustee shall confirm funds transfer instructions by email to a person at the email address specified for such person in Part B of this Certificate. The person confirming the funds transfer instruction shall be a person other than the person from whom the funds transfer instruction was received, unless only one person is designated in both Parts A and B of this Certificate. The Company understands the risks associated with communicating sensitive matters, including time sensitive matters, by email. The Company further acknowledges that instructions and data sent by email may be less confidential or secure than instructions or data transmitted by other methods. The Trustee shall not be liable for any loss of the confidentiality of instructions and data prior to receipt by the Trustee.
		

		
			☐    CHECK box, if applicable:
		

		
			If the Trustee is unable to obtain confirmation by email, the Trustee may, at its discretion, confirm by telephone call-back, as described in Option 1.
		

		
			☐          Option 3. Delivery of funds transfer instructions by password protected file transfer system only - no confirmation. The Trustee offers the option to deliver funds transfer instructions through a password protected file transfer system. If the Company wishes to use the password protected file transfer system, further instructions will be provided by the Trustee. If the Company chooses this Option 3, it agrees that no further confirmation of funds transfer instructions will be performed by the Trustee.
		

		
			☐          Option 4. Delivery of funds transfer instructions by password protected file transfer system with confirmation. Same as Option 3 above, but the Trustee shall confirm funds transfer instructions by telephone call-back or email (must check at least one, may check both) to a person at  the telephone number or email address designated on Part B above. By checking a box in the prior sentence, the party shall be deemed to have agreed to the terms of such confirmation option as more fully described in Option 1 and Option 2 above.
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix N-4

		

 

		

			 

		

		

		
			APPENDIX O
		

		
			FORM OF BLOCKED PERIOD WITHDRAWAL CERTIFICATE
		

		
			
		

		
			

		 

		

			Appendix O-1

		

 

		

			 

		

		

		
			TRANSOCEAN GUARDIAN LIMITED
		

		
			BLOCKED PERIOD WITHDRAWAL CERTIFICATE
		

		
			PURSUANT TO SECTION 4.15 OF THE INDENTURE
		

		
			The undersigned, [ ___ ], as [ ___ ], of Transocean Guardian Limited, a Cayman Islands exempted company (the “Company”), pursuant to Section 4.15 of the indenture, dated as of
		

		
			July 13, 2018 (the “Indenture”), by and among the Company, the guarantors party thereto (the “Guarantors”) and Wells Fargo Bank, National Association, as trustee (in such capacity, “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”), HEREBY CERTIFIES, AUTHORIZES AND INSTRUCTS, for and on behalf of the Company, and without personal liability, as follows:
		

		
			1.          [SELECT ONE ONLY]
		

		
			The Company certifies that it is entitled to withdraw $[       ] (the “Subject Amount”) from the accounts established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture, which represents amounts (a) necessary to make required payments of principal and interest on the Securities, (b) necessary to maintain the Debt Service Reserve, (c) utilized in connection with the ownership and/or operation of the Collateral Rig (including overhead allocations as well as direct costs) and (d) utilized in connection with the performance of the Drilling Contract.
		

		
			[OR]
		

		
			The Company certifies that it is entitled to withdraw $[       ] (the “Subject Amount”) from the accounts established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture, which represents the amount by which the aggregate amount of funds held by the Collateral Agent in the accounts established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture plus the amount in the Debt Service Reserve Account exceeds the principal amount of the Outstanding Securities.
		

		
			2.          (a)      The Company hereby authorizes and instructs the Collateral Agent to withdraw and transfer to an Affiliate of the Company (for the benefit of the Collateral Rig Owner)
		

		
			by wire transfer to the account below $[       ] of the Subject Amount from the account established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture which holds proceeds of the Bareboat Account:
		

		
			Bank Name: 
Bank Address: 
Beneficiary: 
ABA No.: 
Account No.: 
Swift Code:
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix O-2

		

 

		

			 

		

		

		
			(b)        The Company hereby authorizes and instructs the Collateral Agent to withdraw and transfer to an Affiliate of the Company (for the benefit of the Collateral Rig Operator) by wire transfer to the account below $ [  ] of the Subject Amount from the account established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture which holds proceeds of the Earnings Account:
		

		
			Bank Name: 
Bank Address: 
Beneficiary: 
ABA No.: 
Account No.: 
Swift Code:
		

		
			[(c)      The Company hereby authorizes and instructs the Collateral Agent to withdraw and transfer to the Debt Service Reserve Account by wire transfer $ [        ]   of the Subject Amount from the account established in the name of the Collateral Agent pursuant to Section 4.15 of the Indenture which holds proceeds of the [Earnings Account][Bareboat Account].]1
		

		
			3.         The undersigned has read the Indenture, including Section 4.15 of the Indenture, and the Security Documents.
		

		
			4.         The statements made in this certificate are based upon, among other things, an examination of the Securities, the Indenture and the Security Documents, upon the general knowledge of the undersigned and familiarity of the undersigned of the operations of the Company, upon performance of the duties of the undersigned as an officer of the Company and consultation with counsel of the requirements of the Indenture and the Security Documents in respect of the legal matters relating to the withdrawal and transfer of the Subject Amount from the accounts of the Collateral Agent in accordance with Section 4.15 of the Indenture.
		

		
			5.         In the opinion of the undersigned, the undersigned has made such examination or investigation as is necessary to enable the undersigned to express an informed opinion as to whether or not the Company has complied with all conditions precedent and covenants relating to the withdrawal and transfer of the Subject Amount from the accounts of the Collateral Agent.
		

		
			6.         With respect to the foregoing, the undersigned certifies for and on behalf of the Company that, in the opinion of the undersigned, the Company has complied with all conditions precedent and covenants provided for in the Indenture and the Security Documents
		

		

		
			1To be inserted for the transfer of amounts necessary to maintain the Debt Service Reserve.
		

		
			 
		

		
			
		

		
			

		 

		

			Appendix O-3

		

 

		

			 

		

		

		
			relating to the withdrawal and transfer of the Subject Amount from the accounts of the Collateral Agent as described herein.
		

		
			7.         Prior to the disbursement of funds set forth in this certificate, the Company agrees that it shall provide the Collateral Agent with reasonable identifying information requested by the Collateral Agent regarding the recipient of funds such that the Collateral Agent may comply with its regulatory obligations and business practices, including without limitation, a completed United States Internal Revenue Service (“IRS”) Form W-9 or IRS Form W-8, as applicable. All wire transfers shall be subject to the processing fees and claims of the Collateral Agent.
		

		
			Capitalized terms used but not otherwise defined herein shall have the same meanings ascribed to such terms in the Indenture.
		

		
			IN WITNESS WHEREOF, the undersigned has duly executed this Officer’s Certificate.
		

		
			Dated: [           ]
		

			
					
						 

					
					
						TRANSOCEAN GUARDIAN LIMITED

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Appendix O-4

		

 

		

			 

		

		

		
			ANNEX I
		

		
			REPRESENTATIONS AND WARRANTIES OF THE COLLATERAL RIG OWNERS AND COLLATERAL RIG OPERATOR
		

		
			 
		

		
			
		

		
			

		 

		

			Annex I-1

		

 

		

			 

		

		

		
			ANNEX I
		

		
			REPRESENTATIONS AND WARRANTIES OF THE COLLATERAL RIG OWNERS AND
		

		
			COLLATERAL RIG OPERATOR
		

		
			A. Representations and warranties applicable to a Collateral Rig Owner and the Collateral Rig Operator
		

		
			i.        Such Subsidiary is duly organized and validly existing and in good standing (if applicable) under the laws of its jurisdiction of organization, with power and authority (corporate and other) to own its properties and conduct its business and is duly qualified as a foreign corporation for the transaction of business and is in good standing (if applicable) under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification, except where the failure to be so qualified would not have a Material Adverse Effect;
		

		
			ii.       Each of the Security Documents to which such Subsidiary is a party has been duly authorized by such Subsidiary and constitutes valid and legally binding obligations of such Subsidiary enforceable against such Subsidiary in accordance with its terms, except as the enforceability thereof may be subject to the effect of any bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and other laws of general applicability relating to or affecting creditors’ rights and to general principles of equity and public policy (regardless of whether enforcement is sought in a proceeding at law or in equity) and to the discretion of the court before which any proceeding may be brought (collectively, the “Enforceability Exceptions”);
		

		
			iii.      The execution and delivery of the Security Documents to which such Subsidiary is a party are effective to create in favor of the Collateral Agent for the benefit of the Secured Creditors, as security for the applicable obligations in respect of the Note Documents to which such Subsidiary is a party, a lien on all of the Collateral purported to be granted by such Security Documents, and upon the completion of all recordings, filings and other actions necessary to perfect such liens, as further described in such Security Documents, such liens will be perfected as first priority liens (subject only to Permitted Collateral Liens), in each case, to the extent required to be perfected in accordance with such Security Documents and subject to the Enforceability Exceptions;
		

		
			iv.      The compliance by such Subsidiary with all of the provisions of the Note Documents to which such Subsidiary is a party and the consummation of the transactions contemplated therein (a) will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which such Subsidiary is a party or by which such Subsidiary is bound or to which any of the property or assets of such Subsidiary is subject, nor will such action result in any violation of any order, rule or regulation of any court or governmental agency or body having jurisdiction over such Subsidiary or any of its properties, except for any such conflict, breach, violation or default which (1) would not, individually or in the aggregate, have a material adverse effect, (2) would not impair such Subsidiary’s ability to perform its obligations under the Note Documents to which it is a party and (3) would not have any Material Adverse Effect upon the consummation of the transactions contemplated thereby, and (b) will not result in any violation of or default under the provisions of the Organizational
		

		
			
		

		
			

		 

		

			Annex I-2

		

 

		

			 

		

		

		
			Documents of such Subsidiary; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for entry by such Subsidiary into the Note Documents to which such Subsidiary is to be a party or the consummation by such Subsidiary of the transactions contemplated thereby except such as have been, or will be at the time of consummation of such transaction, obtained;
		

		
			v.       There are no legal or governmental proceedings pending to which such Subsidiary is a party or of which any property of such Subsidiary is the subject, which, if determined adversely to such Subsidiary, would, individually or in the aggregate, have a Material Adverse Effect; and, to such Subsidiary’s knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others;
		

		
			vi.      Such Subsidiary is not in violation of its Organizational Documents, or in default in the performance or observance of any material obligation, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it is a party or by which it or any of its properties may be bound, except for any such violation or default which would not, individually or in the aggregate, have a Material Adverse Effect;
		

		
			vii.     Such Subsidiary is in compliance in all material respects with the requirements of all applicable laws of relevant governmental authorities and all orders, writs, injunctions and decrees from relevant governmental authorities applicable to it or to its properties (including, the Collateral Rig, if applicable), except where (i) any such non-compliance, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, or (ii) such Subsidiary is contesting such law, regulation, ordinance or order in good faith by appropriate proceedings and reserves in conformity with GAAP have been provided therefor as applicable;
		

		
			viii.     Except as would not, individually or in the aggregate, have a Material Adverse Effect on Holdings and its Subsidiaries, taken as a whole: (a) such Subsidiary and its operations and facilities are in compliance with, and not subject to any known liabilities under, applicable Environmental Laws, which compliance includes, without limitation, having obtained and being in compliance with any permits, licenses or other governmental authorizations or approvals, and having made all filings and provided all financial assurances and notices, required for the ownership and operation of the business, properties and facilities of such Subsidiary under applicable Environmental Laws, and compliance with the terms and conditions thereof; (b) such Subsidiary has not received any written communication, whether from a governmental authority, citizens group, employee or otherwise, that alleges that such Subsidiary is in violation of any Environmental Law; (c) there is no claim, action or cause of action filed with a court or governmental authority, no investigation with respect to which such Subsidiary has received written notice, and no written notice by any person or entity
		

		
			
		

		
			

		 

		

			Annex I-3

		

 

		

			 

		

		

		
			alleging actual or potential liability on the part of such Subsidiary based on or pursuant to any Environmental Law pending or, to the best of such Subsidiary’s knowledge, threatened against such Subsidiary or any person or entity whose liability under or pursuant to any Environmental Law such Subsidiary has retained or assumed either contractually or by operation of law; (d) such Subsidiary is not conducting or paying for, in whole or in part, any investigation, response or other corrective action pursuant to any Environmental Law at any site or facility, nor is it subject or a party to any order, judgment, decree, contract or agreement which imposes any obligation or liability under any Environmental Law; (e) no lien, charge, encumbrance or restriction has been recorded pursuant to any Environmental Law with respect to any asset, facility or property owned, operated or leased by such Subsidiary; and (f) there are no past or present actions, activities, circumstances, conditions or occurrences, including, without limitation, the Release or threatened Release of any Material of Environmental Concern, that could result in a violation of or liability under any Environmental Law on the part of such Subsidiary, including without limitation, any such liability which such Subsidiary has retained or assumed either contractually or by operation of law;
		

		
			For purposes of this Annex I, “Environment” means ambient air, indoor air, surface water, groundwater, drinking water, soil, surface and subsurface strata, and natural resources such as wetlands, flora and fauna. “Environmental Laws” means the common law and all federal, state, local and foreign laws or regulations, ordinances, codes, orders, decrees, judgments and injunctions issued, promulgated or entered thereunder, relating to pollution or protection of the Environment or human health, including without limitation, those relating to (i) the Release or threatened Release of Materials of Environmental Concern; and (ii) the manufacture, processing, distribution, use, generation, treatment, storage, transport, handling or recycling of Materials of Environmental Concern. “Materials of Environmental Concern” means any substance, material, pollutant, contaminant, chemical, waste, compound, or constituent, in any form, including without limitation, petroleum and petroleum products, subject to regulation or which can give rise to liability under any Environmental Law. “Release” means any release, spill, emission, discharge, deposit, disposal, leaking, pumping, pouring, dumping, emptying, injection or leaching into the Environment, or into, from or through any building, structure or facility;
		

		
			ix.      Neither such Subsidiary, nor any director or officer thereof nor, to such Subsidiary’s knowledge, any employee, agent or representative of such Subsidiary, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any “government official” (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to influence official action or secure an improper advantage in violation of applicable law, and such Subsidiary has conducted its businesses in all material respects in compliance with applicable Anti-Corruption Laws and have instituted and maintain and will continue to maintain policies and procedures designed
		

		
			 
		

		
			
		

		
			

		 

		

			Annex I-4

		

 

		

			 

		

		

		
			 
		

		
			to promote and achieve compliance with such laws and with the representation and warranty contained herein;
		

		
			x.       The operations of such Subsidiary are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where such Subsidiary conducts business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving such Subsidiary with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of such Subsidiary, threatened;
		

		
			xi.       Neither such Subsidiary nor any director nor officer thereof, nor, to such Subsidiary’s knowledge, any employee, agent, affiliate or representative of such Subsidiary, is, or is owned or controlled by a Person that is: (a) the subject of any Sanctions or (b) located, organized or resident in a country or territory that is the subject of Sanctions. For the past 5 years, such Subsidiary has not knowingly engaged in, and is not now knowingly engaged in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions in violation of Sanctions;
		

		
			xii.     Such Subsidiary owns or possesses or can acquire on reasonable terms, all patents, patent rights, licenses, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names currently employed by them in connection with the business now operated by them, except where the failure to so own or possess would not have a Material Adverse Effect, and such Subsidiary has not received any notice of infringement of or conflict with asserted rights of others with respect to any of the foregoing which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect on Holdings and its Subsidiaries, taken as a whole;
		

		
			xiii.    Such Subsidiary possesses and is operating in compliance in all material respects with, all franchises, grants, authorizations, licenses, permits, easements, consents, certificates and orders of any governmental authority or self-regulatory body required for the conduct of its business and all such franchises, grants, authorizations, licenses, permits, easements, consents, certifications and orders are valid and in full force and effect, except where the failure to so possess or operate in compliance would not have a Material Adverse Effect, and such Subsidiary has not received notice of any revocation or modification of any such franchise, grant, authorization, license, permit, easement, consent, certification or order or has reason to believe that any such franchise, grant, authorization, license, permit, easement,
		

		
			 
		

		
			
		

		
			

		 

		

			Annex I-5

		

 

		

			 

		

		

		
			consent, certification or order will not be renewed in the ordinary course, except where such revocation, modification or non-renewal would not have a Material Adverse Effect; and such Subsidiary is in compliance in all material respects with all applicable federal, state, local and foreign laws, regulations, orders and decrees, except where such non-compliance would not have a Material Adverse Effect on Holdings and its Subsidiaries, taken as a whole;
		

		
			xiv.     Such Subsidiary has good and marketable title to all of its property and assets constituting Collateral, free and clear of any lien except for Permitted Collateral Liens;
		

		
			xv.     Such Subsidiary has filed all federal, state, local and foreign tax returns required to be filed through the date hereof or has requested extensions thereof (except where the failure to file would not, individually or in the aggregate, have a Material Adverse Effect) and has paid all taxes shown to be due and payable on such returns (except for cases in which the failure to pay would not have a Material Adverse Effect, or, except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of Holdings), and no tax deficiency has been determined adversely to such Subsidiary which has had (nor does such Subsidiary have any notice or knowledge of any tax deficiency which could be determined adversely to such Subsidiary and which could have) a Material Adverse Effect;
		

		
			xvi.    Such Subsidiary is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as Holdings and such Subsidiary reasonably believe to be prudent and customary in the businesses in which it is engaged; such Subsidiary has not been refused any insurance coverage sought or applied for; and such Subsidiary has no reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have a Material Adverse Effect; and
		

		
			xvii.    Such Subsidiary and any “employee benefit plan” (as defined under the Employee Retirement Income Security Act of 1974 (as amended, “ERISA,” which term, as used herein, includes the regulations and published interpretations thereunder)) established or maintained by such Subsidiary or its “ERISA Affiliates” (as defined below) are in compliance in all material respects with ERISA except for any such non-compliance which would not reasonable be expected to result in a Material Adverse Effect. “ERISA Affiliate” means, with respect to the such Subsidiary, any member of any group of organizations described in Section 414 of the Internal Revenue Code of 1986 (as amended, the “Code,” which term, as used herein, includes the regulations and published interpretations thereunder) of which such Subsidiary is a member. No “reportable event” (as defined under ERISA) has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by such Subsidiary or any of its ERISA Affiliates, which would result in a Material Adverse Effect. No “employee benefit plan” established or maintained by such Subsidiary or any of its ERISA Affiliates, if such “employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA) that would result in a Material Adverse Effect. Neither such Subsidiary nor any of its ERISA Affiliates has incurred or
		

		
			
		

		
			

		 

		

			Annex I-6

		

 

		

			 

		

		

		
			reasonably expects to incur any liability under Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or Sections 412, 4971, 4975 or 4980B of the Code, which would result in a Material Adverse Effect. Each “employee benefit plan” established or maintained by such Subsidiary or any of its ERISA Affiliates that has been determined by the Internal Revenue Service to be qualified under Section 401 of the Code is so qualified and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification.
		

		
			B. Representations and warranties applicable to a Collateral Rig Owner
		

		
			i.        The Securities Guarantee of such Subsidiary has been duly authorized by such Subsidiary and constitutes the valid and legally binding obligation of such Subsidiary enforceable against such Subsidiary in accordance with its terms and entitled to the benefits provided by the Indenture, subject to the Enforceability Exceptions;
		

		
			ii.        Such Subsidiary has good and marketable title to the Collateral Rig, free and clear of any lien except for Permitted Collateral Liens;
		

		
			iii.      The Collateral Rig is registered in such Subsidiary’s name in the flag registry of an Acceptable Flag Jurisdiction;
		

		
			iv.       Such Subsidiary is in good standing as a foreign maritime entity (if applicable) in the Acceptable Flag Jurisdiction in which the Collateral Rig is currently flagged;
		

		
			v.        Such Subsidiary does not conduct, transact or otherwise engage in any material business or operations other than those described in Section 4.11(b);
		

		
			vi.       Such Subsidiary (i) is not party to any material agreements other than the Note Documents, the Bareboat Charter and the Master Services Agreement, and (ii) does not have any Indebtedness other than Indebtedness described in Sections 4.05(b)(i) and 4.05(b)(ii);
		

		
			vii.     The Collateral Rig is classified by an Acceptable Classification Society as is applicable for rigs of its age and type with such classification society, free of any overdue conditions affecting the classification of the Collateral Rig for which no extension has been granted by such Acceptable Classification Society; and
		

		
			viii.    Such Subsidiary (a) is qualified to own the Collateral Rig under the applicable laws of such Subsidiary’s jurisdiction of organization, which shall be a Permitted Jurisdiction, and the Acceptable Flag Jurisdiction in which the Collateral Rig is currently flagged and no necessary or required approval, consent, exemption, authorization or other action by, or notice to, or filing with, or fees payable to, any relevant governmental authority that such Subsidiary’s failure to obtain or pay would reasonably be expected to result in the revocation of such qualification and (b) has obtained, as applicable, the document of compliance, the safety management certificate, the international ship security certificate and all other material ISM Code and ISPS Code documentation required of it for the Collateral
		

		
			
		

		
			

		 

		

			Annex I-7

		

 

		

			 

		

		

		
			Rig and, if necessary, has entered into agreements that provide for use by the Collateral Rig Owner of the applicable management systems of Holdings or an Affiliate of Holdings.
		

		
			C. Representations and warranties applicable to a Collateral Rig Operator
		

		
			i.        Such Subsidiary (a) is qualified to operate the Collateral Rig under the applicable laws of such Subsidiary’s jurisdiction of organization, which shall be a Permitted Jurisdiction, and the Acceptable Flag Jurisdiction in which the Collateral Rig is currently flagged and no necessary or required approval, consent, exemption, authorization or other action by, or notice to, or filing with, or fees payable to, any relevant governmental authority that such Subsidiary’s failure to obtain or pay would reasonably be expected to result in the revocation of such qualification and (b) has obtained, as applicable, the document of compliance, the safety management certificate, the international ship security certificate and all other material ISM Code and ISPS Code documentation required of it for the Collateral Rig and, if necessary, has entered into agreements that provide for use by the Collateral Rig Operator of the applicable management systems of Holdings or an Affiliate of Holdings;
		

		
			ii.       There exists no material default, or other event which after notice or passage of time or both would be a default under the Drilling Contract caused by Holdings or the Collateral Rig Operator or, to the knowledge of Holdings of the Collateral Rig Operator, caused by (i) the counterparty to the Drilling Contract or (ii) any other Person; and
		

		
			iii.     Such Subsidiary does not conduct, transact or otherwise engage in any material business or operations other than those described in Section 4.11(c).
		

		
			 
		

		 

		

			Annex I-8Exhibit 10.1

 

EXECUTION VERSION

 

	
 
    

 

FIRST AMENDMENT TO FIRST LIEN CREDIT AGREEMENT

 

Dated as of July 13, 2018

 

among

 

EXELA INTERMEDIATE HOLDINGS LLC,
 as Holdings,

 

EXELA INTERMEDIATE LLC,
 as Borrower,

 

THE SUBSIDIARY LOAN PARTIES,

 

THE LENDERS PARTY HERETO

 

and

 

ROYAL BANK OF CANADA,

as Administrative Agent,

 

RBC CAPITAL MARKETS,

as Lead Arranger and Bookrunner,

 

	
 
    

 

 

FIRST AMENDMENT TO FIRST LIEN CREDIT AGREEMENT

 

This FIRST AMENDMENT TO FIRST LIEN CREDIT AGREEMENT (this “Agreement”), dated as of July 13, 2018, is made by and among Exela Intermediate Holdings LLC, a Delaware limited liability company (“Holdings”), Exela Intermediate LLC, a Delaware limited liability company (the “Borrower”), each “Subsidiary Loan Party” listed on the signature pages hereto (each, a “Subsidiary Loan Party” and, collectively, jointly and severally, the “Subsidiary Loan Parties”), Royal Bank of Canada, as Administrative Agent under the Existing Credit Agreement (as defined below) (the “Administrative Agent”), and each of the Lenders party hereto.

 

PRELIMINARY STATEMENTS:

 

(1)                                 Holdings, the Borrower, the Lenders party thereto from time to time and the Administrative Agent are party to that certain First Lien Credit Agreement, dated as of July 12, 2017 (as amended, restated, supplemented, waived or otherwise modified from time to time prior to the date hereof, the “Existing Credit Agreement”).

 

(2)                                 The Borrower has requested that the 2018 Repricing Term Lenders (as defined below) and the 2018 Increase Lenders (as defined below) provide 2018 Repriced Term Loans (as defined below) and Additional Term Loans (as defined below) in an aggregate principal amount of $373,437,500, comprised of (a) $343,437,500, as Refinancing Term Loans (as defined in the Existing Credit Agreement) pursuant to Section 2.20(j) of the Existing Credit Agreement and (b) $30,000,000 as Incremental Term Loans (as defined in the Existing Credit Agreement) pursuant to Section 2.20(a) of the Existing Credit Agreement.

 

(3)                                 On the Effective Date (as defined below), each Existing Term Lender (as defined below) that shall have executed and delivered a consent to this Agreement substantially in the form of Exhibit A hereto (a “Repricing Consent”) indicating the “Cashless Settlement Option” (each such Existing Term Lender, a “Cashless Settlement Repricing Lender”) shall be deemed to have exchanged all of its Existing Term Loans (as defined below) for an equal aggregate principal amount of 2018 Repriced Term Loans (or such lesser amount as allocated to such Cashless Settlement Repricing Lender on or prior to the Effective Date) and such Lender shall thereafter become a 2018 Repricing Term Lender.

 

(4)                                 On the Effective Date, each person that executes and delivers this Agreement as a 2018 Increase Lender (as defined below) will make Additional Term Loans (as defined below) to the Borrower in an aggregate principal amount equal to its Increase Commitment (as defined below), the proceeds of which will be used by the Borrower to (i) repay in full the outstanding principal amount of Existing Term Loans that are not exchanged for 2018 Repriced Term Loans (including Loans from Existing Term Lenders that execute and deliver a Repricing Consent indicating the “Assignment Settlement Option” (each such Existing Term Lender, a “Post-Closing Repricing Lender”)) and (ii) for other general corporate purposes.

 

(5)                                 RBC Capital Markets(1) will act as sole lead arranger (in such capacity, the “2018 Arranger”) and bookrunner in respect of the 2018 Repriced Term Loans and the placement of the Increase Commitments with 2018 Increase Lenders.

 

(6)                                 The Administrative Agent, Holdings, the Borrower, the 2018 Repricing Term Lenders, the 2018 Increase Lenders and the other Lenders party hereto (which Lenders together constitute

 

(1)                                 RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its Affiliates.

 

1

 

at least the Required Lenders) desire to memorialize the terms of this Agreement and to make certain other changes set forth herein and in the Amended Credit Agreement (as defined below) by amending and restating, in accordance with Section 9.09(b) of the Existing Credit Agreement, the Existing Credit Agreement as set forth below, such amendment to become effective at the Amendment Effective Time (as defined below).

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, and subject to the conditions set forth herein, the parties hereto hereby agree as follows:

 

SECTION 1.                            Defined Terms.  Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Amended Credit Agreement.  In addition, as used in this Agreement, the following terms have the meanings specified:

 

“2018 Increase Lender” shall mean a person with an Increase Commitment on the Effective Date.  For the avoidance of doubt, an Existing Term Lender immediately prior to the Effective Date may also be a 2018 Increase Lender.

 

“2018 Repriced Term Loans” shall mean each Loan received in exchange for an Existing Term Loan that is held by a Cashless Settlement Repricing Lender.

 

“2018 Repricing Commitment” shall mean the agreement of a Cashless Settlement Repricing Lender to exchange all of its Existing Term Loans for an equal aggregate principal amount of 2018 Repriced Term Loans on the Effective Date (or such lesser amount as allocated to such Cashless Settlement Repricing Lender by the 2018 Arranger on or prior to the Effective Date).

 

“2018 Repricing Term Lender” shall mean each Cashless Settlement Repricing Lender.

 

“Additional Term Loan” shall mean a Loan that is made by a 2018 Increase Lender pursuant to its Increase Commitment under Section 2(a) of this Agreement.

 

“Existing Term Lender” shall mean a Lender with Existing Term Loans outstanding immediately prior to the Effective Date.

 

“Existing Term Loans” shall mean Term B Loans outstanding under the Existing Credit Agreement immediately prior to the Effective Date.

 

“Increase Commitment” shall mean, with respect to each 2018 Increase Lender, the commitment of such 2018 Increase Lender to make Additional Term Loans to the Borrower on the Effective Date.  The amount of each Lender’s Increase Commitment as of the Effective Date is set forth on Schedule 1 hereto.

 

“Non-Exchanging Lender” shall mean each Existing Term Lender that (i) did not execute and deliver a Repricing Consent on or prior to the Effective Date or (ii) is a Post-Closing Repricing Lender.

 

SECTION 2.                            Existing Term Loan Refinancing.  (a)  Subject to the terms and conditions set forth herein, each of the 2018 Repricing Term Lenders agrees to make 2018 Repriced Term Loans to the Borrower on the Effective Date in a principal amount not to exceed its 2018 Repricing Commitment and each of the 2018 Increase Lenders agrees to make Additional Term Loans to the Borrower on the Effective Date in a principal amount not to exceed its Increase Commitment.  The Borrower shall prepay in full all Existing Term Loans of each Non-Exchanging Lender (and, to the extent the aggregate principal amount

 

2

 

of Existing Term Loans of any Cashless Settlement Repricing Lender exceeds the 2018 Repricing Commitment of such Cashless Settlement Repricing Lender, Existing Term Loans of such Cashless Settlement Repricing Lender in an aggregate principal amount equal to such excess amount) with the gross proceeds of the Additional Term Loans and other funds available to the Borrower.  Unless previously terminated, the 2018 Repricing Commitments and the Increase Commitments shall terminate at 11:59 p.m., New York City time, on the Effective Date.

 

(b)         Subject to the terms and conditions set forth herein, each Cashless Settlement Repricing Lender hereby agrees that all of its Existing Term Loans will be automatically exchanged for a like principal amount of 2018 Repriced Term Loans (or a lesser amount allocated to such Cashless Settlement Repricing Lender by the 2018 Arranger on or prior to the Effective Date) on the Effective Date.

 

(c)          The Administrative Agent and each Lender party hereto hereby waive any requirement to deliver any notice of prepayment in connection with the repayment of Existing Term Loans as contemplated by this Agreement.

 

SECTION 3.                            Representations of the Loan Parties.  Each Loan Party hereby represents and warrants to the other parties hereto as of the Effective Date that:

 

(a)         this Agreement has been duly authorized, executed and delivered by each Loan Party and constitutes a legal, valid and binding obligation of such Loan Party enforceable against each such Loan Party in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other similar laws affecting creditors’ rights generally, (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (iii) implied covenants of good faith and fair dealing;

 

(b)         the representations and warranties of the Borrower and each other Loan Party contained in the Loan Documents shall be true and correct in all material respects on and as of the Effective Date (both before and after giving effect to the borrowing of the 2018 Repriced Term Loans and the Additional Term Loans on the Effective Date) with the same effect as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such earlier date);

 

(c)          after giving effect to this Agreement, the execution, delivery and performance by each Loan Party of this Agreement (i) have been duly authorized by all corporate, stockholder, partnership or limited liability company action required to be obtained by such Loan Party and (ii) will not (x) violate (A) any provision of law, statute, rule or regulation applicable to such Loan Party, (B) the certificate or articles of incorporation or other constitutive documents (including any partnership, limited liability company or operating agreements) or by-laws of such Loan Party, (C) any applicable order of any court or any rule, regulation or order of any Governmental Authority applicable to such Loan Party or (D) any provision of any indenture, certificate of designation for preferred stock, agreement or other instrument to which such Loan Party is a party or by which any of them or any of their property is or may be bound, (y) result in a breach of or constitute (alone or with due notice or lapse of time or both) a default under, give rise to a right of or result in any cancellation or acceleration of any right or obligation (including any payment) under any such indenture, certificate of designation for preferred stock, agreement or other instrument, where any such conflict, violation, breach or default referred to in clause (x) or (y) of this clause (c), would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or (z) result in the creation or imposition of any Lien upon or with respect to (1) any property or assets now owned or hereafter acquired by such Loan Party, other than the Liens created by the Loan Documents and Permitted Liens, or (2) any

 

3

 

Equity Interests of the Borrower now owned or hereafter acquired by Holdings, other than Liens created by the Loan Documents or Liens not prohibited by Section 6.02 of the Amended Credit Agreement; and

 

(d)         at the time of and immediately after giving effect to this Agreement, no Default or Event of Default has occurred or is continuing or shall result from this Agreement in respect of the 2018 Repriced Term Loans or the Additional Term Loans, or from the application of the proceeds therefrom.

 

SECTION 4.                            Conditions of Lending. The obligations of the 2018 Repricing Term Lenders to make 2018 Repriced Term Loans and of the 2018 Increase Lenders to make Additional Term Loans, in each case on the Effective Date, are subject (at the time of or substantially concurrently with the making of such Loans) to the satisfaction (or waiver in accordance with Section 9.09 of the Existing Credit Agreement or by a majority of the 2018 Repricing Term Lenders and 2018 Increase Lenders, collectively) of the following conditions (the date of such satisfaction or waiver, the “Effective Date”):

 

(a)         The Administrative Agent (or its counsel) shall have received (i) from each Cashless Settlement Repricing Lender, each Post-Closing Repricing Lender, each 2018 Increase Lender and the other Lenders party hereto (that together  constitute at least the Required Lenders) and (ii) from each of Holdings, the Borrower and the Subsidiary Loan Parties, either (x) a counterpart of this Agreement signed on behalf of such party (or a Repricing Consent) or (y) written evidence reasonably satisfactory to the Administrative Agent (which may include delivery of a signed signature page of this Agreement by facsimile or other means of electronic transmission (e.g., “pdf”)) that such party has signed a counterpart of this Agreement (or a Repricing Consent).

 

(b)         The Borrower shall have paid to the Administrative Agent, for the ratable account of each Existing Term Lender immediately prior to the Effective Date, simultaneously with the making of the 2018 Repriced Term Loans, all accrued and unpaid interest on their Existing Term Loans to, but not including, the Effective Date.

 

(c)          The Administrative Agent shall have received a certificate of the Secretary or Assistant Secretary or similar officer of each Loan Party dated the Effective Date.

 

(i)                                     either (x) attaching a copy of the certificate or articles of incorporation, certificate of limited partnership, certificate of formation or other equivalent constituent and governing documents, including all amendments thereto, of such Loan Party, certified as of a recent date by the Secretary of State (or other similar official) of the jurisdiction of its organization or (y) with respect to any Loan Party other than the Borrower or Holdings, certifying there have been no changes to the certificate or articles of incorporation, certificate of limited partnership, certificate of formation or other equivalent constituent and governing documents of such Loan Party since the Closing Date,

 

(ii)                                  attaching a certificate as to the good standing (to the extent such concept or a similar concept exists under the laws of such jurisdiction) of such Loan Party as of a recent date from such Secretary of State (or other similar official),

 

(iii)                               either (x) certifying that attached thereto is a true and complete copy of the by-laws (or partnership agreement, limited liability company agreement or other equivalent constituent and governing documents) of such Loan Party as in effect on the Effective Date and at all times since a date prior to the date of the resolutions described in clause (iv) below or (y) with respect to any Loan Party other than the Borrower or Holdings, certifying that there have been no changes to the by-laws (or partnership agreement, limited liability company agreement or other equivalent constituent and governing documents) of such Loan Party since the Closing Date,

 

4

 

(iv)                              certifying that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors (or equivalent governing body) of such Loan Party (or its managing general partner or managing member) authorizing the execution, delivery and performance of the Loan Documents executed in connection with this Agreement to which such Loan Party is a party and, in the case of the Borrower, the borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect on the Effective Date,

 

(v)                                 certifying as to the incumbency and specimen signature of each officer executing any Loan Document executed in connection with this Agreement on behalf of such Loan Party, and

 

(vi)                              certifying as to the absence of any pending proceeding for the dissolution or liquidation of such Loan Party or, to the knowledge of such person, threatening the existence of such Loan Party.

 

(d)         The Administrative Agent shall have received, on behalf of itself and the Lenders, the written opinions of (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP and (ii) Jackson Walker L.L.P., in each case, (A) dated the Effective Date, (B) addressed to the Administrative Agent and the Lenders on the Effective Date and (C) in form and substance reasonably satisfactory to the Administrative Agent covering such matters relating to this Agreement as the Administrative Agent shall reasonably request.

 

(e)          All fees and expenses payable under the engagement letter or otherwise in connection with the transactions contemplated hereunder shall have been paid on or prior to the Effective Date (which amounts may be offset against the proceeds of the Loans made hereunder).

 

(f)           The Administrative Agent shall have received on or prior to three (3) Business Days prior to the Effective Date all documentation and other information of the type set forth in Section 3.23(a) of the Existing Credit Agreement, to the extent such information has been requested not less than five (5) Business Days prior to the Effective Date.

 

(g)          The Borrower shall have delivered to the Administrative Agent a certificate from a Responsible Officer of the Borrower dated as of the Effective Date, to the effect set forth in Sections 3(b) and 3(d) hereof.

 

(h) At least three (3) Business Days prior to the Effective Date, any Borrower that qualifies as a “legal entity customer” under 31 C.F.R. §1010.230 (the “Beneficial Ownership Regulation”) shall deliver, to each Lender that so requests, a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation in relation to such Borrower.

 

(i) The Administrative Agent shall have received a Borrowing Request as required by Section 2.03 (or a Borrowing Request shall have been deemed given in accordance with the last paragraph of Section 2.03).

 

SECTION 5.                            Consent and Affirmation of the Subsidiary Loan Parties.  Each of the Subsidiary Loan Parties, in its capacity as a guarantor under the Subsidiary Guarantee Agreement and a pledgor under the other Security Documents to which it is a party, hereby (i) consents to the execution, delivery and performance of this Agreement and agrees that each of the Subsidiary Guarantee Agreement and the other Security Documents to which it is a party is, and shall continue to be, in full force and effect and is hereby in all respects ratified and confirmed on the Effective Date, except that, on and after the Effective Date, each reference to “Credit Agreement”, “First Lien Credit Agreement”, “thereunder”, “thereof” or words of

 

5

 

like import shall, unless the context otherwise requires, mean and be a reference to the Amended Credit Agreement and (ii) confirms that the Security Documents to which it is a party and all of the Collateral described therein do, and shall continue to, secure the payment of all of the Obligations.

 

SECTION 6.                            Amendment and Restatement of the Existing Credit Agreement.  Immediately after the funding of the 2018 Repriced Term Loans and the Additional Term Loans on the Effective Date pursuant to Section 2 hereof in accordance with Section 4 hereof (such time, the “Amendment Effective Time”), the Existing Credit Agreement shall be amended and restated in its entirety as set forth on Annex A hereto (the Existing Credit Agreement, as so amended and restated, the “Amended Credit Agreement”), and the Lenders party hereto (which Lenders constitute at least the Required Lenders) consent to the amendments reflected in the Amended Credit Agreement and direct the Administrative Agent to enter into such other Loan Documents and to take such other actions as the Administrative Agent determines may be necessary or desirable to give effect to the transactions contemplated hereby.

 

SECTION 7.                            Reference to and Effect on the Loan Documents.  (a) On and after the Amendment Effective Time, each reference in the Amended Credit Agreement to “hereunder”, “hereof”, “Agreement”, “this Agreement” or words of like import and each reference in the other Loan Documents to “Credit Agreement”, “First Lien Credit Agreement”, “thereunder”, “thereof” or words of like import shall, unless the context otherwise requires, mean and be a reference to the Amended Credit Agreement. From and after the Amendment Effective Time, this Agreement shall be a Loan Document under the Existing Credit Agreement and the Amended Credit Agreement.

 

(b)         The Security Documents and each other Loan Document, as specifically amended by this Agreement, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed, and the respective guarantees, pledges, grants of security interests and other agreements, as applicable, under each of the Security Documents, notwithstanding the consummation of the transactions contemplated hereby, shall continue to be in full force and effect and shall accrue to the benefit of the Secured Parties under the Existing Credit Agreement and the Amended Credit Agreement. Without limiting the generality of the foregoing, the Security Documents and all of the Collateral described therein do and shall continue to secure the payment of all Obligations of the Loan Parties under the Loan Documents, in each case, as amended by this Agreement.

 

(c)          The execution, delivery and effectiveness of this Agreement shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents.

 

(d)                                 This Agreement shall constitute an “Incremental Assumption Agreement”, the 2018 Repricing Term Lenders and the 2018 Increase Lenders shall constitute “Term B Lenders” and “Lenders”, the 2018 Repriced Term Loans shall constitute “Refinancing Term Loans”, “Term Loans” and “Loans”, the Additional Term Loans shall constitute “Incremental Term Loans” and “Term Loans” and “Loans”, and the 2018 Repricing Commitments and the Increase Commitments shall constitute “Term Facility Commitments” and “Commitments”, in each case, for all purposes of the Amended Credit Agreement and the other Loan Documents.

 

(e)                                  This Agreement shall constitute notice to the Administrative Agent required under Sections 2.10(d) and 2.20(j) of the Existing Credit Agreement (and such shorter period(s) are agreed to by the Administrative Agent) and each Lender party hereto hereby waives any prior notice requirement under the Existing Credit Agreement, including under Section 2.20(j) thereof.

 

6

 

(f)                                   For the avoidance of doubt, each 2018 Repricing Term Lender waives any break funding payment that it would be entitled to receive pursuant to Section 2.16 of the Existing Credit Agreement as an Existing Term Lender as a result of this Agreement.

 

SECTION 8.                            Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by .pdf or other electronic form shall be effective as delivery of a manually executed original counterpart of this Agreement.

 

SECTION 9.                            Amendments; Headings; Severability. This Agreement may not be amended nor may any provision hereof be waived except pursuant to a writing signed by Holdings, the Borrower, the Administrative Agent and the Lenders party hereto.  The Section headings used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting this Agreement.  Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.  The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

 

SECTION 10.                     Governing Law; Etc.

 

(a)         THIS AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSES OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ANY PRINCIPLE OF CONFLICTS OF LAW THAT COULD REQUIRE THE APPLICATION OF ANY OTHER LAW.

 

(b)         EACH PARTY HERETO HEREBY AGREES AS SET FORTH IN SECTIONS 9.13 AND 9.17 OF THE EXISTING CREDIT AGREEMENT AS IF SUCH SECTIONS WERE SET FORTH IN FULL HEREIN.

 

SECTION 11.                     No Novation.  This Agreement shall not extinguish the obligations for the payment of money outstanding under the Existing Credit Agreement or discharge, impair or release the Lien or priority of any Security Document or any other security therefor, or the perfection of any Lien. Nothing herein contained shall be construed as a substitution or novation of the obligations outstanding under the Existing Credit Agreement or instruments securing the same, which shall remain in full force and effect, except to any extent modified hereby or by instruments executed concurrently herewith and except to the extent repaid as provided herein.  Nothing implied in this Agreement or in any other document contemplated hereby shall be construed as a release, impairment or other discharge of any of the Loan Parties under any Loan Document from any of its obligations and liabilities as a borrower, guarantor or pledgor under any of the Loan Documents.  This Agreement shall not constitute a novation of the Existing Credit Agreement or any other Loan Document.

 

SECTION 12.                     Notices.  All notices hereunder shall be given in accordance with the provisions of Section 9.01 of the Amended Credit Agreement.

 

[Signature Pages Follow]

 

7

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

 

	
 
    	
HOLDINGS:
    
	
 
    	
 
    
	
 
    	
EXELA   INTERMEDIATE HOLDINGS LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    
	
 
    	
 
    
	
 
    	
BORROWER:
    
	
 
    	
 
    
	
 
    	
EXELA   INTERMEDIATE LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
SUBSIDIARY LOAN PARTIES:
    
	
 
    	
 
    
	
 
    	
SOURCEHOV HOLDINGS, INC.
    
	
 
    	
SOURCEHOV LLC
    
	
 
    	
CORPSOURCE HOLDINGS, LLC
    
	
 
    	
SOURCECORP, INCORPORATED
    
	
 
    	
SOURCECORP BPS INC.
    
	
 
    	
DELIVEREX, LLC
    
	
 
    	
UNITED INFORMATION SERVICES, INC.
    
	
 
    	
ECONOMIC RESEARCH SERVICES, INC.
    
	
 
    	
SOURCECORP LEGAL INC.
    
	
 
    	
RUST CONSULTING, INC.
    
	
 
    	
SOURCEHOV HEALTHCARE, INC.
    
	
 
    	
SOURCEHOV TAX, INC.
    
	
 
    	
KINSELLA MEDIA LLC
    
	
 
    	
HOV SERVICES, LLC
    
	
 
    	
HOV ENTERPRISE SERVICES, INC.
    
	
 
    	
MERIDIAN CONSULTING GROUP, LLC
    
	
 
    	
RUSTIC CANYON III, LLC
    
	
 
    	
CHARTER LASON, INC.
    
	
 
    	
LASON INTERNATIONAL, INC.
    
	
 
    	
SOURCECORP MANAGEMENT, INC.
    
	
 
    	
PANGEA ACQUISITIONS INC.
    
	
 
    	
EXELA FINANCE INC.
    
	
 
    	
RC4 CAPITAL, LLC
    
	
 
    	
BANCTEC, INC.
    
	
 
    	
BANCTEC (PUERTO RICO), INC.
    
	
 
    	
DOCUDATA SOLUTIONS, L.C.
    
	
 
    	
BANCTEC INTERMEDIATE HOLDING, INC.
    
	
 
    	
BTC INTERNATIONAL HOLDINGS, INC.
    
	
 
    	
HOVG, LLC
    
	
 
    	
MANAGED CARE PROFESSIONALS, LLC
    
	
 
    	
BTC VENTURES, INC.
    
	
 
    	
RECOGNITION MEXICO HOLDING INC.
    
	
 
    	
DFG2 HOLDINGS, LLC
    
	
 
    	
DFG2, LLC
    
	
 
    	
DFG UK, LLC
    
	
 
    	
TRAC HOLDINGS, LLC
    
	
 
    	
NOVITEX HOLDINGS, INC.
    
	
 
    	
NOVITEX INTERMEDIATE, LLC
    
	
 
    	
NOVITEX ACQUISITION, LLC
    
	
 
    	
EXELA ENTERPRISE SOLUTIONS, INC.
    
	
 
    	
IBIS CONSULTING, INC.,
    
	
 
    	
SIG-GP, L.L.C., A   LIMITED LIABILITY COMPANY
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
FTS PARENT INC.
    
	
 
    	
TRANSCENTRA, INC.
    
	
 
    	
J & B SOFTWARE, INC.
    
	
 
    	
REGULUS HOLDING INC.
    
	
 
    	
BANCTEC GROUP LLC
    
	
 
    	
HOV SERVICES, INC.
    
	
 
    	
REGULUS GROUP LLC
    
	
 
    	
REGULUS GROUP II LLC
    
	
 
    	
REGULUS AMERICA LLC
    
	
 
    	
REGULUS INTEGRATED SOLUTIONS LLC
    
	
 
    	
REGULUS TRI-STATE   LLC
    
	
 
    	
REGULUS WEST LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    
	
 
    	
 
    
	
 
    	
NOVITEX GOVERNMENT SOLUTIONS, LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Executive Vice President, Chief Financial   Officer and Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SERVICES INTEGRATION GROUP, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
SIG-GP, L.L.C., A LIMITED LIABILITY COMPANY, its General Partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Reynolds
    
	
 
    	
 
    	
Name: James Reynolds
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
ADMINISTRATIVE   AGENT:
    
	
 
    	
 
    
	
 
    	
ROYAL   BANK OF CANADA
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Yvonne Brazier
    
	
 
    	
 
    	
Name: Yvonne Brazier
    
	
 
    	
 
    	
Title:   Manager, Agency Services
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
2018   INCREASE LENDER:
    
	
 
    	
 
    
	
 
    	
ROYAL   BANK OF CANADA
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Christian Gutierrez
    
	
 
    	
 
    	
Name: Christian   Gutierrez
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
ROYAL   BANK OF CANADA, as   Revolving Facility Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Theodore Brown
    
	
 
    	
 
    	
Name: Theodore Brown
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
CREDIT SUISSE AG, CAYMAN   ISLANDS BRANCH, as Revolving Facility Lender
    
	
 
    	
 
    
	
 
    	
 
    	
By: 
    	
/s/ Judith Smith
    
	
 
    	
 
    	
Name: Judith Smith
    
	
 
    	
 
    	
Title:   Authorized Signatory
    
	
 
    	
 
    
	
 
    	
 
    	
By: 
    	
/s/ Lingzi Huang
    
	
 
    	
 
    	
Name: Lingzi Huang
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
Credit Suisse Loan Funding LLC,
    
	
 
    	
as Revolving Facility   Lender
    
	
 
    	
 
    
	
 
    	
 
    	
By: 
    	
/s/ Leigh Dworkin
    
	
 
    	
 
    	
Name: Leigh Dworkin
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

[Incremental Assumption and Amendment Agreement]

 

 

	
 
    	
Natixis New York Branch,   as Revolving Facility Lender
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Khallil Benzine
    
	
 
    	
 
    	
Name: Khallil Benzine
    
	
 
    	
 
    	
Title:   Executive Director, Head of Strategic   Portfolio Optimization and Leveraged Finance Asset Management
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Michael Lardieri
    
	
 
    	
 
    	
Name: Michael Lardieri
    
	
 
    	
 
    	
Title:   Vice President, Corporate Coverage Banker
    

 

[Incremental Assumption and Amendment Agreement]

 

 

EXHIBIT A

 

Royal Bank of Canada, as Administrative Agent
 200 Bay Street, South Tower, 12th Floor

Toronto, Ontario M5J 2W7 Canada

Attention:                                         Manager, Agency Services

Telephone:                                   (416) 842-5196
 Fax:                                                                       (416) 842-4023

 

EXELA INTERMEDIATE LLC

Repricing Consent

 

Ladies and Gentlemen:

 

Reference is made to the First Amendment to First Lien Credit Agreement (the “Amendment”), dated as of July 13, 2018, to that certain First Lien Credit Agreement, dated as of July 12, 2017 (as amended by the Amendment and as otherwise may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Amended Credit Agreement”), by and among Exela Intermediate LLC (the “Borrower”), Exela Intermediate Holdings LLC (“Holdings”), each “Subsidiary Loan Party” listed on the signature pages thereto, the Lenders party thereto, and Royal Bank of Canada, as administrative agent (in such capacity, the “Administrative Agent”) and each of the Lenders party thereto.  Unless otherwise specified herein, capitalized terms used but not defined herein are used as defined in the Amendment.

 

By delivery of this Repricing Consent, each of the undersigned (each a “Participating Lender”), hereby irrevocably consents to the Amendment and the amendments of the Amended Credit Agreement contemplated thereby and (check as applicable):

 

NAME OF PARTICIPATING EXISTING TERM LENDER:

 

o                                    Cashless Settlement Option.  Hereby (i) elects, upon the Effective Date, to exchange the full amount (or such lesser amount as may be allocated to it by the Lead Arranger) of the outstanding Existing Term Loans of such Participating Lender for an equal outstanding amount of 2018 Repriced Term Loans under the Amended Credit Agreement and (ii) represents and warrants to the Administrative Agent that it has the organizational power and authority to execute, deliver and perform its obligations under this letter agreement and the Amendment (including, without limitation, with respect to any exchange contemplated hereby) and has taken all necessary corporate and other organizational action to authorize the execution, delivery and performance of this letter agreement and the Amendment.

 

o                                    Assignment Settlement Option.  Hereby (i) elects to have the full amount (or such lesser amount as may be allocated to it by the Lead Arranger) of the outstanding Existing Term Loans of such Participating Lender repaid or purchased and agrees to promptly (but in any event, on or prior to the date that is 30 days following the Effective Date) purchase an equal amount of 2018 Repriced Term Loans and (ii) represents and warrants to the Administrative Agent that it has the organizational power and authority to execute, deliver and perform its obligations under this letter agreement and the Amendment (including, without limitation, with respect to any exchange contemplated hereby) and has taken all necessary corporate and other organizational action to authorize the execution, delivery and performance of this letter agreement and the Amendment.

 

 

Please indicate your consent to the Amendment by consenting online via LendAmend or by submitting an executed signature page, a form of which is attached to ExelaJune18@Lendamend.com no later than 5:00 p.m. New York City time on June 19, 2018. For questions about signature pages or execution matters please contact LendAmend at +1 (646) 453-2812 or (646) 453-2813.

 

[Signature Page Follows]

 

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
                                   ,
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

SCHEDULE 1

 

Increase Commitments

 

	
2018 Increase Lender
    	
 
    	
Increase Commitment
    	
 
    
	
Royal Bank of   Canada
    	
 
    	
$
    	
30,000,000
    	
 
    
	
Total:
    	
 
    	
$
    	
30,000,000
    	
 
    

 

 

ANNEX A

 

[See attached.]

 

 

AMENDED AND RESTATED FIRST LIEN CREDIT AGREEMENT

 

dated as of July 12, 2017,

 

as amended and restated as of July 13, 2018

 

among

 

EXELA INTERMEDIATE HOLDINGS LLC,
 as Holdings,

 

EXELA INTERMEDIATE LLC, 
 as Borrower,

 

THE LENDERS PARTY HERETO

 

and

 

ROYAL BANK OF CANADA,
 as Administrative Agent and Collateral Agent

 

 

RBC CAPITAL MARKETS(1),
  CREDIT SUISSE SECURITIES (USA) LLC,
 NATIXIS, NEW YORK BRANCH

 

and

 

KKR CAPITAL MARKETS LLC,

 

as Joint Lead Arrangers and Joint Bookrunners

 

(1)  RBC Capital Markets is a brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I
    
	
DEFINITIONS
    
	
 
    	
 
    	
 
    
	
SECTION 1.01
    	
Defined Terms
    	
2
    
	
SECTION 1.02
    	
Terms Generally
    	
65
    
	
SECTION 1.03
    	
Effectuation of   Transactions
    	
65
    
	
SECTION 1.04
    	
Exchange Rates;   Currency Translation
    	
65
    
	
SECTION 1.05
    	
Letter of Credit   Amounts
    	
66
    
	
SECTION 1.06
    	
Additional Alternate   Currencies for Loans
    	
66
    
	
SECTION 1.07
    	
Change of Currency
    	
66
    
	
SECTION 1.08
    	
Timing of Payment or   Performance
    	
67
    
	
SECTION 1.09
    	
Times of Day
    	
67
    
	
 
    	
 
    	
 
    
	
ARTICLE II
    
	
THE CREDITS
    
	
 
    	
 
    	
 
    
	
SECTION 2.01
    	
Commitments
    	
67
    
	
SECTION 2.02
    	
Loans and Borrowings
    	
67
    
	
SECTION 2.03
    	
Requests for Borrowings
    	
68
    
	
SECTION 2.04
    	
[Reserved]
    	
69
    
	
SECTION 2.05
    	
Letters of Credit
    	
69
    
	
SECTION 2.06
    	
Funding of Borrowings
    	
76
    
	
SECTION 2.07
    	
Interest Elections
    	
77
    
	
SECTION 2.08
    	
Termination and   Reduction of Commitments
    	
78
    
	
SECTION 2.09
    	
Repayment of Loans;   Evidence of Debt
    	
79
    
	
SECTION 2.10
    	
Repayment of Term Loans   and Revolving Facility Loans
    	
79
    
	
SECTION 2.11
    	
Prepayment of Loans
    	
81
    
	
SECTION 2.12
    	
Fees
    	
83
    
	
SECTION 2.13
    	
Interest
    	
84
    
	
SECTION 2.14
    	
Alternate Rate of   Interest
    	
85
    
	
SECTION 2.15
    	
Increased Costs
    	
86
    
	
SECTION 2.16
    	
Break Funding Payments
    	
87
    
	
SECTION 2.17
    	
Taxes
    	
87
    
	
SECTION 2.18
    	
Payments Generally; Pro   Rata Treatment; Sharing of Set-offs
    	
90
    
	
SECTION 2.19
    	
Mitigation Obligations;   Replacement of Lenders
    	
92
    
	
SECTION 2.20
    	
Incremental Commitments
    	
94
    
	
SECTION 2.21
    	
Illegality
    	
102
    
	
SECTION 2.22
    	
Cash Collateral
    	
102
    
	
SECTION 2.23
    	
Defaulting Lenders
    	
103
    
	
 
    	
 
    	
 
    
	
ARTICLE III
    
	
REPRESENTATIONS AND WARRANTIES
    
	
 
    	
 
    	
 
    
	
SECTION 3.01
    	
Organization; Powers
    	
105
    
	
SECTION 3.02
    	
Authorization
    	
105
    
	
SECTION 3.03
    	
Enforceability
    	
106
    
	
SECTION 3.04
    	
Governmental Approvals
    	
106
    
	
SECTION 3.05
    	
Financial Statements
    	
106
    
	
SECTION 3.06
    	
No Material Adverse   Effect
    	
107
    

 

 

	
SECTION 3.07
    	
Title to Properties;   Possession Under Leases
    	
107
    
	
SECTION 3.08
    	
Subsidiaries
    	
107
    
	
SECTION 3.09
    	
Litigation; Compliance   with Laws
    	
108
    
	
SECTION 3.10
    	
Federal Reserve   Regulations
    	
108
    
	
SECTION 3.11
    	
Investment Company Act
    	
108
    
	
SECTION 3.12
    	
Use of Proceeds
    	
108
    
	
SECTION 3.13
    	
Tax Returns
    	
109
    
	
SECTION 3.14
    	
No Material   Misstatements
    	
109
    
	
SECTION 3.15
    	
Employee Benefit Plans
    	
110
    
	
SECTION 3.16
    	
Environmental Matters
    	
110
    
	
SECTION 3.17
    	
Security Documents
    	
111
    
	
SECTION 3.18
    	
Location of Real   Property
    	
112
    
	
SECTION 3.19
    	
Solvency
    	
112
    
	
SECTION 3.20
    	
Labor Matters
    	
112
    
	
SECTION 3.21
    	
Insurance
    	
112
    
	
SECTION 3.22
    	
Senior Debt
    	
113
    
	
SECTION 3.23
    	
USA PATRIOT Act;   Sanctions Laws and Export Controls Laws
    	
113
    
	
SECTION 3.24
    	
Foreign Corrupt   Practices Act
    	
113
    
	
SECTION 3.25
    	
Intellectual Property
    	
113
    
	
 
    	
 
    	
 
    
	
ARTICLE IV
    
	
CONDITIONS OF LENDING
    
	
 
    	
 
    	
 
    
	
SECTION 4.01
    	
All Credit Events
    	
114
    
	
SECTION 4.02
    	
[Reserved]
    	
115
    
	
 
    	
 
    	
 
    
	
ARTICLE V
    
	
AFFIRMATIVE COVENANTS
    
	
 
    	
 
    	
 
    
	
SECTION 5.01
    	
Existence; Businesses   and Properties
    	
115
    
	
SECTION 5.02
    	
Insurance
    	
115
    
	
SECTION 5.03
    	
Taxes
    	
116
    
	
SECTION 5.04
    	
Financial Statements,   Reports, etc.
    	
117
    
	
SECTION 5.05
    	
Litigation and Other   Notices
    	
119
    
	
SECTION 5.06
    	
Compliance with Laws
    	
119
    
	
SECTION 5.07
    	
Maintaining Records;   Access to Properties and Inspections
    	
119
    
	
SECTION 5.08
    	
Payment of Obligations
    	
120
    
	
SECTION 5.09
    	
Use of Proceeds
    	
120
    
	
SECTION 5.10
    	
Compliance with   Environmental Laws
    	
120
    
	
SECTION 5.11
    	
Further Assurances;   Additional Security
    	
120
    
	
SECTION 5.12
    	
Rating
    	
123
    
	
SECTION 5.13
    	
Post-Closing
    	
123
    
	
 
    	
 
    	
 
    
	
ARTICLE VI
    
	
NEGATIVE COVENANTS
    
	
 
    	
 
    	
 
    
	
SECTION 6.01
    	
Indebtedness
    	
124
    
	
SECTION 6.02
    	
Liens
    	
130
    
	
SECTION 6.03
    	
Sale and Lease-Back   Transactions
    	
136
    
	
SECTION 6.04
    	
Investments, Loans and   Advances
    	
136
    
	
SECTION 6.05
    	
Mergers,   Consolidations, Sales of Assets and Acquisitions
    	
140
    
	
SECTION 6.06
    	
Dividends and   Distributions
    	
143
    

 

ii

 

	
SECTION 6.07
    	
Transactions with   Affiliates
    	
146
    
	
SECTION 6.08
    	
Business of Holdings,   the Borrower and the Subsidiaries
    	
149
    
	
SECTION 6.09
    	
Limitation on   Modifications and Payments of Indebtedness; Modifications of Certificate of   Incorporation, By-Laws and Certain Other Agreements; etc.
    	
149
    
	
SECTION 6.10
    	
Fiscal Year
    	
152
    
	
SECTION 6.11
    	
Financial Covenant
    	
152
    
	
 
    	
 
    	
 
    
	
ARTICLE VII
    
	
EVENTS OF DEFAULT
    
	
 
    	
 
    	
 
    
	
SECTION 7.01
    	
Events of Default
    	
152
    
	
SECTION 7.02
    	
Treatment of Certain   Payments
    	
155
    
	
SECTION 7.03
    	
Cure Right
    	
155
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII
    
	
THE AGENTS
    
	
 
    	
 
    	
 
    
	
SECTION 8.01
    	
Appointment and   Authority
    	
156
    
	
SECTION 8.02
    	
Rights as a Lender
    	
156
    
	
SECTION 8.03
    	
Exculpatory Provisions
    	
157
    
	
SECTION 8.04
    	
Reliance by   Administrative Agent
    	
157
    
	
SECTION 8.05
    	
Delegation of Duties
    	
158
    
	
SECTION 8.06
    	
Resignation of   Administrative Agent
    	
158
    
	
SECTION 8.07
    	
Non-Reliance on   Administrative Agent and Other Lenders
    	
159
    
	
SECTION 8.08
    	
No Other Duties, Etc.
    	
159
    
	
SECTION 8.09
    	
Administrative Agent   May File Proofs of Claim
    	
159
    
	
SECTION 8.10
    	
Collateral Agreement
    	
160
    
	
 
    	
 
    	
 
    
	
ARTICLE IX
    
	
MISCELLANEOUS
    
	
 
    	
 
    	
 
    
	
SECTION 9.01
    	
Notices; Communications
    	
160
    
	
SECTION 9.02
    	
Survival of Agreement
    	
162
    
	
SECTION 9.03
    	
Binding Effect
    	
162
    
	
SECTION 9.04
    	
Successors and Assigns
    	
162
    
	
SECTION 9.05
    	
Expenses; Indemnity
    	
167
    
	
SECTION 9.06
    	
Right of Set-off
    	
169
    
	
SECTION 9.07
    	
Payments Set Aside
    	
170
    
	
SECTION 9.08
    	
Applicable Law
    	
170
    
	
SECTION 9.09
    	
Waivers; Amendment
    	
170
    
	
SECTION 9.10
    	
Interest Rate   Limitation
    	
174
    
	
SECTION 9.11
    	
[Reserved]
    	
174
    
	
SECTION 9.12
    	
Entire Agreement
    	
174
    
	
SECTION 9.13
    	
WAIVER OF JURY TRIAL
    	
174
    
	
SECTION 9.14
    	
Severability
    	
174
    
	
SECTION 9.15
    	
Counterparts
    	
175
    
	
SECTION 9.16
    	
Headings
    	
175
    
	
SECTION 9.17
    	
Jurisdiction; Consent   to Service of Process
    	
175
    
	
SECTION 9.18
    	
Confidentiality
    	
175
    
	
SECTION 9.19
    	
Direct Website   Communications
    	
176
    
	
SECTION 9.20
    	
Release of Liens and   Guarantees
    	
177
    

 

iii

 

	
SECTION 9.21
    	
Intercreditor Agreement   Authorization
    	
179
    
	
SECTION 9.22
    	
U.S.A. Patriot Act
    	
179
    
	
SECTION 9.23
    	
No Advisory or   Fiduciary Relationship
    	
179
    
	
SECTION 9.24
    	
Affiliate Lenders
    	
180
    
	
SECTION 9.25
    	
Judgment Currency
    	
181
    
	
SECTION 9.26
    	
Agency of the Borrower   for the Loan Parties
    	
181
    
	
SECTION 9.27
    	
Acknowledgement and   Consent to Bail-In of EEA Financial Institutions
    	
181
    
	
SECTION 9.28
    	
Original Credit   Agreement; Effectiveness of Amendment and Restatement
    	
182
    

 

iv

 

Exhibits and Schedules

 

	
Exhibit A
    	
Form of Assignment   and Acceptance
    
	
Exhibit B
    	
Form of Interest   Election Request
    
	
Exhibit C
    	
Form of Borrowing   Request
    
	
Exhibit D
    	
Form of First   Lien/Second Lien Intercreditor Agreement
    
	
Exhibit E
    	
Form of Solvency   Certificate
    
	
Exhibit F
    	
Form of   Prepayment/Reduction Notice
    
	
Exhibit G
    	
Form of Permitted   Loan Purchase Assignment and Acceptance
    
	
Exhibit H
    	
Form of   Intercompany Subordination Terms
    
	
 
    	
 
    
	
Schedule 1.01(a)
    	
Certain Excluded Equity   Interests
    
	
Schedule 1.01(b)
    	
Immaterial Subsidiaries
    
	
Schedule 1.01(c)
    	
Existing Roll-Over   Letters of Credit
    
	
Schedule 1.01(d)
    	
Closing Date Unrestricted   Subsidiaries
    
	
Schedule 1.01(e)
    	
Closing Date Mortgaged   Properties
    
	
Schedule 2.01
    	
Commitments and Lenders
    
	
Schedule 3.01
    	
Organization and Good   Standing
    
	
Schedule 3.04
    	
Governmental Approvals
    
	
Schedule 3.05
    	
Financial Statements
    
	
Schedule 3.07(b)
    	
Possession under Leases
    
	
Schedule 3.08(a)
    	
Subsidiaries
    
	
Schedule 3.08(b)
    	
Subscriptions
    
	
Schedule 3.13
    	
Taxes
    
	
Schedule 3.15
    	
Employee Benefit Plans
    
	
Schedule 3.16
    	
Environmental Matters
    
	
Schedule 3.21
    	
Insurance
    
	
Schedule 5.13
    	
Post-Closing Items
    
	
Schedule 6.01
    	
Indebtedness
    
	
Schedule 6.02(a)
    	
Liens
    
	
Schedule 6.04
    	
Investments;   Intercompany Loans
    
	
Schedule 6.07
    	
Transactions with   Affiliates
    
	
Schedule 6.09(c)
    	
Contractual   Encumbrances and Restrictions
    
	
Schedule 9.01(a)(i)
    	
Notice Information
    

 

v

 

AMENDED AND RESTATED FIRST LIEN CREDIT AGREEMENT

 

This AMENDED AND RESTATED FIRST LIEN CREDIT AGREEMENT, dated as of July 13, 2018 (this “Agreement”), is made by and among EXELA INTERMEDIATE HOLDINGS LLC, a Delaware limited liability company and a Wholly Owned Subsidiary (as hereinafter defined) of Parent (as hereinafter defined) (“Holdings”), EXELA INTERMEDIATE LLC, a Delaware limited liability company and a Wholly Owned Subsidiary of Holdings (the “Borrower”), the Lenders (as hereinafter defined) from time to time party hereto, ROYAL BANK OF CANADA, as administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”) for the Lenders, with RBC CAPITAL MARKETS(1), CREDIT SUISSE SECURITIES (USA) LLC, NATIXIS, NEW YORK BRANCH and KKR CAPITAL MARKETS LLC, as joint lead arrangers  and joint bookrunners (in such capacities, each, a “Joint Lead Arranger” and together, the “Joint Lead Arrangers”).

 

WHEREAS, Holdings, Borrower, the Lenders party thereto and the Administrative Agent entered into that certain First Lien Credit Agreement, dated as of July 12, 2017 (the “Original Credit Agreement”);

 

WHEREAS, Quinpario Acquisition Corp. 2 (to be renamed Exela Technologies, Inc. upon consummation of the Business Combination), a Delaware corporation (“Parent”), Quinpario Merger Sub I, Inc., a Delaware corporation (“SourceHOV Merger Sub”), Quinpario Merger Sub II, Inc., a Delaware corporation (“Novitex Merger Sub”), Novitex Holdings, Inc., a Delaware corporation (“Novitex”), SourceHOV Holdings, Inc., a Delaware corporation (“SourceHOV” and together with Novitex, each a “Company” and, collectively, the “Companies”), Novitex Parent, L.P. (“Novitex Parent”), HOVS LLC and HandsOn Fund 4 I, LLC (collectively, the “HCM Group”) entered into the Business Combination Agreement (as hereinafter defined) pursuant to which (i) Novitex Merger Sub was merged with and into Novitex, with Novitex surviving as a Wholly Owned Subsidiary of the Borrower (the “Novitex Merger”) and (ii) SourceHOV Merger Sub was merged with and into SourceHOV, with SourceHOV surviving as a Wholly Owned Subsidiary of the Borrower (the “SourceHOV Merger”);

 

WHEREAS, the Borrower has entered into that certain First Amendment to First Lien Credit Agreement (the “First Amendment”), dated as of July 13, 2018 (the “Repricing Effective Date”), by and among Holdings, the Borrower, the Subsidiary Loan Parties party thereto, the Lenders party thereto and the Administrative Agent, under which certain Lenders (such Lenders, the “2018 Term Lenders”) are extending credit to the Borrower in the form of Term B Loans in an aggregate amount of $373,437,500 (the “2018 Term Loans” ), comprised of (a) Refinancing Term Loans consisting of Term B Loans in an aggregate principal amount of $343,437,500 and (b) Incremental Term Loans in an aggregate principal amount of $30,000,000; and

 

WHEREAS, the Administrative Agent, Holdings, the Borrower, the 2018 Term Lenders and the other Lenders party to the First Amendment have agreed to amend and restate the Original Credit Agreement as provided in this Agreement;

 

NOW, THEREFORE, the Original Credit Agreement shall be, and hereby is, amended and restated as follows:

 

(1)  RBC Capital Markets is a brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

 

ARTICLE I
 DEFINITIONS

 

SECTION 1.01                                           Defined Terms.  As used in this Agreement, the following terms shall have the meanings specified below:

 

“2018 Term Lenders” shall have the meaning assigned to such term in the recitals hereto.

 

“2018 Term Loans” shall have the meaning assigned to such term in the recitals hereto.

 

“ABR” shall mean, for any day, a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate in effect for such day plus 0.50%, (b) the Prime Rate in effect on such day and (c) the Adjusted Eurocurrency Rate for a one-month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.00%; provided that, for the avoidance of doubt, the Eurocurrency Rate for any day shall be based on the rate determined on such day at approximately 11:00 a.m. (London time) by reference to the ICE Benchmark Administration Interest Settlement Rates (or the successor thereto if the ICE Benchmark Administration is no longer making a Eurocurrency Rate available) for deposits in Dollars (as set forth by any service selected by the Administrative Agent that has been nominated by the ICE Benchmark Administration (or the successor thereto if the ICE Benchmark Administration is no longer making a Eurocurrency Rate available) as an authorized vendor for the purpose of displaying such rates).  Any change in such rate due to a change in the Prime Rate, the Federal Funds Rate or the Adjusted Eurocurrency Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Rate or the Adjusted Eurocurrency Rate, as the case may be.

 

“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.

 

“ABR Loan” shall mean any ABR Term Loan or any ABR Revolving Loan to the Borrower.

 

“ABR Revolving Borrowing” shall mean a Borrowing comprised of ABR Revolving Loans.

 

“ABR Revolving Loan” shall mean any Revolving Facility Loan bearing interest at a rate determined by reference to the ABR in accordance with the provisions of Article II.

 

“ABR Term Loan” shall mean any Term Loan bearing interest at a rate determined by reference to the ABR in accordance with the provisions of Article II.

 

“Additional Mortgage” shall have the meaning assigned to such term in Section 5.11(c)(i).

 

“Adjusted Eurocurrency Rate” shall mean, with respect to any Eurocurrency Borrowing for any Interest Period, an interest rate per annum equal to the greater of (x) (a) the Eurocurrency Rate in effect for such Interest Period divided by (b) one minus the Statutory Reserves applicable to such Eurocurrency Borrowing, if any; provided that if such interest rate shall be less than zero pursuant to this clause (x), such interest rate shall be deemed to be zero and (y) in the case of Eurocurrency Borrowings composed of Eurocurrency Term Loans, 1.00%

 

“Adjustment Date” shall have the meaning assigned to such term in the definition of “Pricing Grid.”

 

2

 

“Administrative Agent” shall have the meaning assigned to such term in the preamble hereto, together with its successors and assigns.

 

“Administrative Agent Fees” shall have the meaning assigned to such term in Section 2.12(c).

 

“Affiliate” shall mean, when used with respect to a specified person, another person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified.

 

“Affiliate Lender” shall have the meaning assigned to such term in Section 9.24(a).

 

“Agent Parties” shall have the meaning assigned to such term in Section 9.19(c).

 

“Agents” shall mean the Administrative Agent and the Collateral Agent.

 

“AGNL Lease” means the Lease Agreement, dated as of November 15, 2010, between AGNL Processing, L.L.C. and BancTec, Inc., as amended, restated or otherwise modified from time to time.

 

“Agreement” shall have the meaning assigned to such term in the preamble hereto, as may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms hereof.

 

“All-in Yield” shall mean, as to any Loans (or Pari Term Loans, if applicable), the yield thereon payable to all Lenders (or other lenders, as applicable) providing such Loans (or Pari Term Loans, if applicable) in the primary syndication thereof, as reasonably determined by the Administrative Agent in consultation with the Borrower, whether in the form of interest rate, margin, original issue discount, up-front fees, rate floors or otherwise; provided that original issue discount and up-front fees shall be equated to interest rate assuming a 4-year life to maturity (or, if less, the life of such Loans (or Pari Term Loans, if applicable)); and provided, further, that “All-in Yield” shall not include arrangement, commitment, underwriting, structuring or similar fees and customary consent fees for an amendment paid generally to consenting lenders.

 

“Alternate Currency” shall mean (i) with respect to any Letter of Credit, Canadian Dollars, Euros, Pound Sterling and Australian Dollars and any other currency other than Dollars as may be acceptable to the Administrative Agent and the Issuing Bank with respect thereto in their sole discretion and (ii) with respect to any Loan, any currency other than Dollars that is approved in accordance with Section 1.06.

 

“Alternate Currency Equivalent” shall mean, at any time, with respect to any amount denominated in Dollars, the equivalent amount thereof in the applicable Alternate Currency as determined by the Administrative Agent or the applicable Issuing Bank, as the case may be, at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of such Alternate Currency with Dollars.

 

“Alternate Currency Letter of Credit” shall mean any Letter of Credit denominated in an Alternate Currency.

 

“Alternate Currency Loan” shall mean any Loan denominated in an Alternate Currency.

 

3

 

“Anti-Corruption Laws” shall have the meaning assigned to such term in Section 3.24.

 

“Applicable Commitment Fee” shall mean for any day (i) with respect to any Revolving Facility Commitments relating to Initial Revolving Facility Loans, 0.50% per annum; provided, however, that on and after the first Adjustment Date occurring after delivery of the financial statements and certificates required by Section 5.04 upon the completion of one full fiscal quarter of the Borrower after the Closing Date, the “Applicable Commitment Fee” will be determined pursuant to the Pricing Grid, or (ii) with respect to any Other Revolving Facility Commitments, the “Applicable Commitment Fee” set forth in the applicable Incremental Assumption Agreement.

 

“Applicable Date” shall have the meaning assigned to such term in Section 9.09(f).

 

“Applicable Margin” shall mean for any day (i) with respect to any Term B Loan, 6.50% per annum in the case of any Eurocurrency Loan and 5.50% per annum in the case of any ABR Loan, (ii) with respect to any Initial Revolving Facility Loan, 7.00% per annum in the case of any Eurocurrency Loan and 6.00% per annum in the case of any ABR Loan; provided, however, that on and after the first Adjustment Date occurring after delivery of the financial statements and certificates required by Section 5.04 upon the completion of one full fiscal quarter of the Borrower after the Closing Date, the “Applicable Margin” with respect to an Initial Revolving Facility Loan will be determined pursuant to the Pricing Grid, and (iii) with respect to any Other Term Loan or Other Revolving Facility Loan, the “Applicable Margin” set forth in the Incremental Assumption Agreement relating thereto.

 

“Applicable Percentage” shall mean, (a) in respect of the Term B Loans, with respect to any Term B Lender at any time, the percentage (carried out to the ninth decimal place) of the Term B Loans represented by the principal amount of such Term B Lender’s Term B Loans at such time, (b) in respect of the Other Term Loans, with respect to any Incremental Term Loan Lender at any time, the percentage (carried out to the ninth decimal place) of the Other Term Loans represented by (i) such Incremental Term Loan Lender’s Incremental Term Loan Commitment at such time and (ii) thereafter, the principal amount of such Incremental Term Loan Lender’s Other Term Loans at such time and (c) in respect of any Class of Revolving Facility Loans, with respect to any Revolving Facility Lender of such Class at any time, the percentage (carried out to the ninth decimal place) of the Revolving Facility Loans of such Class represented by such Revolving Facility Lender’s Revolving Facility Commitment at such time.  If the commitment of any Revolving Facility Lender to make Revolving Facility Loans of any Class and the obligation of the Issuing Banks to make L/C Advances have been terminated pursuant to Section 7.01, or if the Revolving Facility Commitments of such Class have expired, then the Applicable Percentage of each Revolving Facility Lender in respect of such Class of Revolving Facility Loans shall be determined based on the relative amounts of such Revolving Facility Lender’s Revolving Facility Exposures of such Class in respect of the total Revolving Facility Exposure of such Class most recently in effect, giving effect to any subsequent assignments.  The initial Applicable Percentage of each Lender in respect of each Facility is set forth opposite the name of such Lender on Schedule 2.01 to the Original Credit Agreement or in the Assignment and Acceptance pursuant to which such Lender becomes a party hereto, as applicable.

 

“Approved Fund” shall have the meaning assigned to such term in Section 9.04(b)(ii).

 

“Asset Sale” shall mean any Disposition (including any sale and leaseback of assets and any mortgage or lease of Real Property) to any person of, any asset or assets of the Borrower or any Subsidiary.

 

“Assignee” shall have the meaning assigned to such term in Section 9.04(b)(i).

 

4

 

“Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an Assignee, and accepted by the Administrative Agent and the Borrower (if required by Section 9.04), in the form of Exhibit A to the Original Credit Agreement or such other form as shall be approved by the Administrative Agent and reasonably satisfactory to the Borrower.

 

“Assignor” shall have the meaning assigned to such term in Section 9.04(i).

 

“Available Free Cash Flow Amount” shall mean, at any time of determination, an amount, not less than zero in the aggregate, determined on a cumulative basis equal to, without duplication:

 

(a)                                 $50,000,000, plus

 

(b)                                 the Cumulative Retained Excess Cash Flow Amount on such date of determination, plus

 

(c)                                  (i) the aggregate amount of proceeds received after the Closing Date and prior to such date of determination that would have constituted Net Proceeds pursuant to clause (a) of the definition thereof except for the operation of clause (x) or (y) of the second proviso thereof (the “Below Threshold Asset Sale Proceeds”) and (ii) the aggregate amount of any Declined Proceeds, plus

 

(d)                                 the Cumulative Equity Proceeds Amount on such date of determination, plus

 

(e)                                  the aggregate principal amount of any Indebtedness (including the liquidation preference or maximum fixed repurchase price, as the case may be, of any Disqualified Stock) of the Borrower or any Subsidiary thereof issued after the Closing Date (other than Indebtedness issued to a Subsidiary), which has been converted into or exchanged for Qualified Equity Interests in the Borrower, Holdings or any Parent Entity; plus

 

(f)                                   in the event any Unrestricted Subsidiary has been redesignated as a Subsidiary or has been merged, consolidated or amalgamated with or into, or transfers or conveys its assets to, or is liquidated into, the Borrower or any Subsidiary, the Fair Market Value (as determined in good faith by the Borrower) of the Investments of the Borrower or any Subsidiary in such Unrestricted Subsidiary at the time of such redesignation, combination or transfer (or of the assets transferred or conveyed, as applicable); plus

 

(g)                                  an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received by the Borrower or any Subsidiary in respect of any Investments made pursuant to Section 6.04(j)(Y) to the extent not otherwise applied pursuant to Section 6.04(j)(Z), minus

 

(h)                                 the cumulative amount of Investments pursuant to Section 6.04(j)(Y) from and after the Closing Date and on or prior to such time, minus

 

(i)                                     the cumulative amount of all dividends paid and distributions made pursuant to Section 6.06(h) from and after the Closing Date and on or prior to such time, minus

 

(j)                                    the cumulative amount of the Available Free Cash Flow Amount immediately prior to the time of such determination used to repay, repurchase, redeem, acquire, cancel or terminate Indebtedness pursuant to Section 6.09(b)(i)(E) from and after the Closing Date and on

 

5

 

or prior to such time (other than payments made with proceeds from the issuance of Equity Interests that were excluded from the Cumulative Equity Proceeds Amount);

 

provided, however, (A) for purposes of Section 6.06(h), the calculation of the Available Free Cash Flow Amount shall not include any Below Threshold Asset Sale Proceeds except to the extent they are used as contemplated in clauses (h) and (j) above, and (B) Available Free Cash Flow Amount shall only be increased pursuant to clause (b) above to the extent that Excess Cash Flow for any Excess Cash Flow Period exceeds the ECF Threshold Amount (or, with respect to any Excess Cash Flow Interim Period, a pro rata portion of such amount).

 

“Available Unused Commitment” shall mean, with respect to a Revolving Facility Lender under any Class of Revolving Facility Commitments at any time, an amount equal to the Dollar Equivalent of the amount by which (a) the aggregate amount of the applicable Revolving Facility Commitment of such Revolving Facility Lender at such time exceeds (b) the applicable Revolving Facility Exposure of such Revolving Facility Lender at such time.

 

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

“Board” shall mean the Board of Governors of the Federal Reserve System of the United States of America.

 

“Board of Directors” shall mean, as to any person, the board of directors or managers or other governing body, as applicable, of such person (or, if such person is owned or managed by a single entity, the board of directors or other governing body of such entity) or any duly authorized committee thereof.

 

“Borrower” shall have the meaning assigned to such term in the preamble hereto.

 

“Borrowing” shall mean a group of Loans of a single Type, Class and currency and made on a single date and, in the case of Eurocurrency Loans, as to which a single Interest Period is in effect.

 

“Borrowing Minimum” shall mean $1,000,000.

 

“Borrowing Multiple” shall mean $250,000.

 

“Borrowing Request” shall mean a request by the Borrower in accordance with the terms of Section 2.03 and substantially in the form of Exhibit C to the Original Credit Agreement or another form approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved by the Administrative Agent).

 

“Budget” shall have the meaning assigned to such term in Section 5.04(e).

 

“Business Combination” shall mean, collectively, the Reorganization, the SourceHOV Merger and the Novitex Merger.

 

6

 

“Business Combination Agreement” shall mean the Business Combination Agreement, dated as of February 21, 2017, by and among Parent, SourceHOV Merger Sub, Novitex Merger Sub, Novitex, SourceHOV, Novitex Parent and HCM Group, and any other agreements or instruments contemplated thereby, in each case, as may be amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time.

 

“Business Day” shall mean any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that when used in connection with a Eurocurrency Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in deposits in Dollars in the London interbank market.

 

“Capital Expenditures” shall mean, for any person in respect of any period, the aggregate of all expenditures incurred by such person during such period that, in accordance with GAAP, are or should be included in “additions to property, plant or equipment” or similar items reflected in the statement of cash flows of such person.

 

“Capitalized Lease Obligations” shall mean, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with GAAP; provided that obligations of the Borrower or its Subsidiaries, or of a special purpose or other entity not consolidated with the Borrower and its Subsidiaries, either existing on the Closing Date or created thereafter that (a) initially were not included on the consolidated balance sheet of the Borrower as capital lease obligations and were subsequently recharacterized as capital lease obligations or, in the case of such a special purpose or other entity becoming consolidated with the Borrower and its Subsidiaries were required to be characterized as capital lease obligations upon such consolidation, in either case, due to a change in accounting treatment or otherwise, or (b) did not exist on the Closing Date and were required to be characterized as capital lease obligations but would not have been required to be treated as capital lease obligations on the Closing Date had they existed at that time, shall for all purposes not be treated as Capitalized Lease Obligations or Indebtedness.

 

“Capitalized Software Expenditures” shall mean, for any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities) by a person during such period in respect of licensed or purchased software or internally developed software and software enhancements that, in accordance with GAAP, are or are required to be reflected as capitalized costs on the consolidated balance sheet of such person and its subsidiaries.

 

“Cash Collateralize” shall mean to pledge and deposit with or deliver to the Collateral Agent, for the benefit of the Administrative Agent, any applicable Issuing Bank and the Lenders, as collateral for unreimbursed L/C Disbursements or obligations of Lenders to fund participations in respect of either thereof (as the context may require), cash or deposit account balances or, if the Administrative Agent and each applicable Issuing Bank benefitting from such collateral shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance reasonably satisfactory to (a) the Administrative Agent and (b) each applicable Issuing Bank. “Cash Collateral”, “Cash Collateralization” and “Cash Collateralized” shall have meanings correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

 

“Cash Interest Expense” shall mean, with respect to any person on a consolidated basis for any period, Interest Expense for such period to the extent such amounts are paid in cash for such period, less, without duplication, the sum of (a) pay-in-kind Interest Expense or other noncash Interest Expense (including as a result of the effects of purchase accounting), (b) to the extent included in Interest Expense, the amortization of any financing fees paid by, or on behalf of, the Borrower or any Subsidiary,

 

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including such fees paid in connection with the Transactions, the Repricing Date Transactions or upon entering into a Permitted Securitization Financing, (c) the amortization of debt discounts, if any, fees or breakage costs in respect of Swap Agreements, (d) cash interest income of the Borrower and the Subsidiaries for such period and (e) any other expenses included in Interest Expense not paid in cash; provided that Cash Interest Expense shall exclude any one-time financing fees paid in connection with the Transactions, the Repricing Date Transactions or any other Indebtedness permitted to be incurred under this Agreement or upon entering into a Permitted Securitization Financing or one-time amendment fees paid in connection with any amendment of this Agreement or any other Indebtedness.

 

“Cash Management Agreement” shall mean any agreement to provide to Holdings, the Borrower or any Subsidiary cash management services for collections, treasury management services (including controlled disbursement, overdraft, automated clearing house fund transfer services, return items and interstate depository network services), any demand deposit, payroll, trust or operating account relationships, commercial credit cards, merchant card, purchase or debit cards, non-card e-payables services, and other cash management services, including electronic funds transfer services, lockbox services, stop payment services and wire transfer services.

 

“Cash Management Bank” shall mean any person that, at the time it enters into a Cash Management Agreement (or on the Closing Date), is an Agent, a Joint Lead Arranger, a Lender or an Affiliate of any such person, in each case, in its capacity as a party to such Cash Management Agreement.

 

“Casualty Event” shall mean any involuntary loss of title or any involuntary loss of, or casualty or damage to, or destruction of, or any condemnation or other taking (including by any Governmental Authority) or similar proceeding of, any equipment, fixed assets, or real property (including any improvements thereon) of Borrower or any Restricted Subsidiary.

 

“CFC” shall mean a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.

 

A “Change in Control” shall be deemed to occur if:

 

(a)                                 any person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act, but excluding any employee benefit plan of such person, entity or “group” and its subsidiaries and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan), other than the Permitted Holders (or any holding company parent of the Borrower owned directly or indirectly by the Permitted Holders), shall at any time have acquired direct or indirect beneficial ownership (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act) of voting power of the outstanding Voting Stock of the Borrower having more than the greater of (A) 35% of the ordinary voting power for the election of directors of the Borrower and (B) the percentage of the ordinary voting power for the election of directors of the Borrower owned in the aggregate, directly or indirectly, beneficially, by the Permitted Holders, unless in the case of this clause (a), the Permitted Holders have, at such time, the right or the ability by voting power, contract or otherwise to elect or designate for election at least a majority of the members of the Board of Directors of the Borrower; or

 

(b)                                 a “Change in Control” (as defined in (i) the Senior Secured Notes Indenture until the discharge or the redemption of the same, (ii) any indenture or credit agreement in respect of Permitted Refinancing Indebtedness with respect to the Senior Secured Notes constituting Material Indebtedness or (iii) any indenture or credit agreement in respect of any Junior Financing constituting Material Indebtedness) shall have occurred; or

 

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(c)                                  Holdings shall fail to own, directly or indirectly, beneficially and of record, 100% of the issued and outstanding Equity Interests of the Borrower.

 

For purposes of this definition, (i) no person or “group” will be deemed to have beneficial ownership of any securities that such person or “group” has the right to acquire or vote only upon the happening of any future event or contingency (including the passage of time) that has not yet occurred and (ii) the provisions of Rule 13d-3(b) shall be disregarded for all purposes of determining beneficial ownership.

 

“Change in Law” shall mean (a) the adoption of any law, rule or regulation after the Closing Date (or, if later, such date a Lender becomes a party to this Agreement), (b) any change in law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the Closing Date (or, if later, such date a Lender becomes a party to this Agreement) or (c) compliance by any Lender or any Issuing Bank (or, for purposes of Section 2.15(b), by any Lending Office of such Lender or by such Lender’s or Issuing Bank’s holding company, if any) with any written request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Closing Date (or, if later, such date a Lender becomes a party to this Agreement); provided, however, for purposes of this Agreement, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder or issued in connection therewith or in implementation thereof and (y) all requests, rules, guidelines, requirements or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States of America regulatory authorities, in each case pursuant to Basel III, shall in each case described in clauses (x) and (y) above, be deemed to be a Change in Law, regardless of the date enacted, adopted, issued or implemented, but only to the extent a Lender is imposing applicable increased costs or costs in connection with capital adequacy requirements similar to those described in clauses (a) and (b) of Section 2.15 generally on other borrowers of loans under United States of America cash flow term loan credit facilities.

 

“Charges” shall have the meaning assigned to such term in Section 9.10.

 

“Claims Administration Arrangements” shall mean any and all arrangements entered into by the Borrower or any of its Subsidiaries and any Claims Administration Bank whereby short-term loans (which loans shall be secured solely by Claim Administration Liens) are made by such Claims Administration Bank to the Borrower or any of its Subsidiaries; provided that the proceeds of such loans are deposited in one or more segregated deposit or securities accounts and are solely used to purchase Claims Administration Investments (which shall be held in such segregated accounts) and pay transaction costs in connection therewith.

 

“Claims Administration Bank” shall mean any third-party financial institution meeting the qualifications specified in clause (b) of the definition of “Permitted Investments” (or otherwise reasonably acceptable to the Administrative Agent) that is designated by the Borrower or any of its Subsidiaries to hold and distribute certain legal settlement funds administered by the Borrower or its Subsidiaries in connection with the Borrower’s claims administration business.

 

“Claims Administration Indebtedness” shall mean Indebtedness for borrowed money of the Borrower or any of its Subsidiaries in favor of the Claims Administration Bank in respect of loans made pursuant to Claims Administration Arrangements.

 

“Claims Administration Investments” shall mean Permitted Investments invested with proceeds of Claims Administration Indebtedness.

 

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“Claims Administration Liens” shall mean Liens in favor of the Claims Administration Bank on Claims Administration Investments and related segregated deposit and securities accounts securing Claims Administration Indebtedness solely to the extent the amount of such Claims Administration Investment equals or exceeds the amount of such Claims Administration Indebtedness.

 

“Class” shall  mean (a) when used in reference to any Loan or Borrowing, whether such Loan, or the Loans comprising such Borrowing, are Initial Revolving Facility Loans, Term B Loans, Other Revolving Facility Loans, Other Term Loans, Extended Revolving Loans, Refinancing Term Loans or Replacement Revolving Loans and (b) when used in reference to any Commitment, refers to whether such Commitment is in respect of a commitment to make Initial Revolving Facility Loans, Term B Loans, Other Revolving Facility Loans, Other Term Loans, Extended Revolving Loans, Refinancing Term Loans or Replacement Revolving Loans.  Other Term Loans (together with the Incremental Term Loan Commitments in respect thereof), Other Revolving Facility Loans (together with the Incremental Revolving Facility Commitments in respect thereof), Extended Revolving Loans, Refinancing Term Loans and Replacement Revolving Loans that have different terms and conditions shall be construed to be in different Classes.

 

“Class Loans” shall have the meaning assigned to such term in Section 9.09(f).

 

“Closing Date” shall mean July 12, 2017.

 

“Closing Date Material Adverse Effect” shall mean any event, change, development or effect that, individually or in the aggregate with all other events, changes, developments or effects, has had, or would reasonably be expected to have, a material adverse effect upon (a) the assets, liabilities, condition (financial or otherwise), the business or results of operations of the Company Group, taken as a whole, or (b) the ability of the Company to consummate the transactions contemplated hereunder in accordance with the terms and subject to the conditions set forth herein; provided that the following shall not be taken into account in determining whether a “Closing Date Material Adverse Effect” shall have occurred: (i) any national, international or any foreign or domestic regional economic, financial, social or political conditions (including changes therein) or events in general, including the results of any primary or general elections, (ii) changes in any financial, debt, credit, capital or banking markets or conditions (including any disruption thereof), (iii) changes in interest, currency or exchange rates or the price of any commodity, security or market index, (iv) changes in legal or regulatory conditions, including changes or proposed changes in Law, GAAP or other accounting principles or requirements, or standards, interpretations or enforcement thereof, (v) changes that are generally applicable to the industries in which the Company Group operates or seasonal fluctuations in the Businesses, (vi) any change in the market price or trading volume of any securities or indebtedness of any member of the Company Group or any of their respective Affiliates (it being understood that the underlying causes of such change may, if they are not otherwise excluded from the definition of “Closing Date Material Adverse Effect” , be taken into account in determining whether a Closing Date Material Adverse Effect has occurred), (vii) any change in, or failure of the Company Group to meet, or the publication of any report regarding, any internal or public projections, forecasts, budgets or estimates of or relating to the Company Group for any period, including with respect to revenue, earnings, cash flow or cash position (it being understood that the underlying causes of such decline or failure may, if they are not otherwise excluded from the definition of “Closing Date Material Adverse Effect,” be taken into account in determining whether a Closing Date Material Adverse Effect has occurred), (viii) the occurrence, escalation, outbreak or worsening of any hostilities, war, police action, acts of terrorism or military conflicts, whether or not pursuant to the declaration of an emergency or war, (ix) the existence, occurrence or continuation of any force majeure events, including any earthquakes, floods, hurricanes, tropical storms, fires or other natural disasters or any national, international or regional calamity, (x) any Action arising from or relating to the Business Combination Agreement or the transactions contemplated by the Business Combination Agreement,

 

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(xi) the execution, announcement, performance or existence of the Business Combination Agreement, the identity of the parties hereto or any of their respective Affiliates, Representatives or financing sources, the taking or not taking of any action to the extent required by the Business Combination Agreement or the pendency or contemplated consummation of the transactions contemplated by the Business Combination Agreement, including any actual or potential loss or impairment after the date of the Business Combination Agreement of any Contract or any Customer, supplier, landlord, partner, employee or other business relation due to any of the foregoing in this clause (it being understood that the factors giving rise to or contributing to any such adverse change under clause (xi) that are not otherwise excluded from the definition of “Closing Date Material Adverse Effect” may be deemed to constitute, or be taken into account in determining whether there has been or would be reasonably likely to have been, a Closing Date Material Adverse Effect), (xii) compliance by the Company Group with the terms of the Business Combination Agreement, including the failure to take any action restricted by the Business Combination Agreement (but excluding effects resulting from the Closing), (xiii) any actions taken, or not taken, with the consent, waiver or at the request of Parent, Novitex Merger Sub or SourceHOV Merger Sub or any action taken to the extent expressly permitted by the Business Combination Agreement, (xiv) any actions taken by Parent, Novitex Merger Sub, SourceHOV Merger Sub or any of their respective Affiliates or any of their respective Representatives or financing sources after the date of the Business Combination Agreement, (xv) any matters disclosed in the Disclosure Schedules, disclosed to Parent, Novitex Merger Sub or SourceHOV Merger Sub or any of their respective Affiliates or Representatives; provided, however, that with respect to each of clauses (i) through (v), any event, development, occurrence, fact, condition, or change referred to above shall be taken into account in determining whether a Closing Date Material Adverse Effect has occurred or would reasonably be expected to occur to the extent that such event, development, occurrence, fact, condition, or change has a disproportionate effect on the Company Group compared to other participants in the industries in which the Company Group primarily conducts its business.  Capitalized terms used in this definition of “Closing Date Material Adverse Effect,” other than the definition of “Business Combination Agreement,” shall have the same meaning set forth in the Business Combination Agreement as in effect on the date of the Business Combination Agreement.

 

“Closing Date Mortgaged Properties” shall have the meaning assigned to such term in the definition of “Mortgaged Properties.”

 

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

 

“Co-Investors” shall mean each of (a) the Investors and the Investor Affiliates (excluding any of their portfolio companies) and (b) the Management Group.

 

“Collateral” shall mean all the “Collateral” as defined in any Security Document and shall also include the Mortgaged Properties and all other property that is or is intended to be subject to any Lien in favor of the Administrative Agent, the Collateral Agent or any sub-agent for the benefit of the Secured Parties pursuant to any Security Document.

 

“Collateral Agent” shall have the meaning assigned to such term in the preamble hereto, together with its successors and assigns.

 

“Collateral Agreement” shall mean the Collateral Agency and Security Agreement (First Lien), dated as of the Closing Date, as may be amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time, among the Borrower, each Subsidiary Loan Party and the Collateral Agent.

 

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“Collateral and Guarantee Requirement” shall mean the requirement that (in each case subject to the last paragraph of Section 4.02, Sections 5.11(d), (e) and (g) and Schedule 5.13 to the Original Credit Agreement):

 

(a)                                 on the Closing Date, the Collateral Agent shall have received (i) from the Borrower, and each Subsidiary Loan Party, a counterpart of the Collateral Agreement and (ii) from each Subsidiary Loan Party, a counterpart of the Subsidiary Guarantee Agreement and (iii) from Holdings, a counterpart of the Holdings Guarantee and Pledge Agreement, in each case duly executed and delivered on behalf of such person;

 

(b)                                 on the Closing Date, (i)(x) all outstanding Equity Interests of the Borrower and all other outstanding Equity Interests, in each case, directly owned by the Loan Parties, other than Excluded Securities, and (y) all Indebtedness owing to any Loan Party, other than Excluded Securities, shall have been, in each case, pledged pursuant to the Collateral Agreement or the Holdings Guarantee and Pledge Agreement, as applicable, and (ii) the Collateral Agent shall have received certificates or other instruments (if any) representing such Equity Interests (other than certificates or instruments issued by subsidiaries of the Borrower that are not received from the Companies on or prior to the Closing Date after using commercially reasonable efforts) and any notes or other instruments required to be delivered pursuant to the applicable Security Documents, together with stock powers, note powers or other instruments of transfer (if any) with respect thereto endorsed in blank;

 

(c)                                  in the case of any person that becomes a Subsidiary Loan Party after the Closing Date, the Collateral Agent shall have received (i) a supplement to the Collateral Agreement and the Subsidiary Guarantee Agreement and (ii) supplements to the other Security Documents, if applicable, in the form specified therefor or otherwise reasonably acceptable to the Administrative Agent, in each case, duly executed and delivered on behalf of such Subsidiary Loan Party;

 

(d)                                 after the Closing Date, (x) all outstanding Equity Interests of any person that becomes a Subsidiary Loan Party after the Closing Date and (y) subject to Section 5.11(g), all Equity Interests directly acquired by the Borrower or a Subsidiary Loan Party (and any Equity Interests of the Borrower directly acquired by Holdings) after the Closing Date, other than Excluded Securities, shall have been pledged pursuant to the Collateral Agreement (or the Holdings Guaranty and Pledge Agreement, as applicable), together with stock powers or other instruments of transfer (if any) with respect thereto endorsed in blank;

 

(e)                                  except as otherwise contemplated by this Agreement or any Security Document, all documents and instruments, including Uniform Commercial Code financing statements, and filings with the United States Copyright Office and the United States Patent and Trademark Office, and all other actions reasonably requested by the Administrative Agent (including those required by applicable Requirements of Law) to be delivered, filed, registered or recorded to create the Liens intended to be created by the Security Documents (in each case, including any supplements thereto) and perfect such Liens to the extent required by, and with the priority required by, the Security Documents, shall have been delivered, filed, registered or recorded or delivered to the Collateral Agent for filing, registration or the recording concurrently with, or promptly following, the execution and delivery of each such Security Document;

 

(f)                                   within (x) 90 days after the Closing Date with respect to each Closing Date Mortgaged Property set forth on Schedule 1.01(e) to the Original Credit Agreement (or on such later date as the Administrative Agent may agree in its reasonable discretion) and (y) within the

 

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time periods set forth in Section 5.11 with respect to Mortgaged Properties encumbered pursuant to said Section 5.11, the Collateral Agent shall have received (i) counterparts of each Mortgage to be entered into with respect to each such Mortgaged Property duly executed and delivered by the applicable Loan Party and suitable for recording or filing in all filing or recording offices that the Administrative Agent may reasonably deem necessary or desirable in order to create a valid and enforceable Lien subject to no other Liens except Permitted Liens, at the time of recordation thereof, (ii) with respect to the Mortgage encumbering each such Mortgaged Property, opinions of counsel regarding the enforceability, due authorization, execution and delivery of the Mortgages and such other matters customarily covered in real estate counsel opinions as the Administrative Agent may reasonably request, in form and substance reasonably acceptable to the Administrative Agent, (iii) with respect to each such Mortgaged Property, the Flood Documentation and (iv) such other documents as the Administrative Agent may reasonably request that are available to the Borrower without material expense with respect to any such Mortgage or Mortgaged Property;

 

(g)                                  within (x) 90 days after the Closing Date with respect to each Closing Date Mortgaged Property set forth on Schedule 1.01(e) to the Original Credit Agreement (or on such later date as the Administrative Agent may agree in its reasonable discretion) and (y) within the time periods set forth in Section 5.11 with respect to Mortgaged Properties encumbered pursuant to said Section 5.11, the Collateral Agent shall have received (i) a policy or policies or marked up unconditional binders of title insurance with respect to properties located in the United States of America, or a date down and modification endorsement, if available, paid for by the Borrower at a premium payable based upon the lesser of the appraised value of the Mortgaged Property and the principal amount of the Loans secured by such Mortgaged Property, issued by a nationally recognized title insurance company insuring the Lien of each Mortgage as a valid Lien on the Mortgaged Property described therein, free of any other Liens except Permitted Liens, together with such customary endorsements, coinsurance and reinsurance as the Administrative Agent may reasonably request and which are available at commercially reasonable rates in the jurisdiction where the applicable Mortgaged Property is located and (ii) a survey of each Mortgaged Property located in the United States of America (including all improvements, easements and other customary matters thereon reasonably required by the Administrative Agent), as applicable, for which all necessary fees (where applicable) have been paid, which is (A) complying in all material respects with the minimum detail requirements of the American Land Title Association and American Congress of Surveying and Mapping as such requirements are in effect on the date of preparation of such survey and (B) sufficient for such title insurance company to remove all standard survey exceptions from the title insurance policy relating to such Mortgaged Property and to issue the customary and available survey related endorsements or otherwise reasonably acceptable to the Administrative Agent;

 

(h)                                 the Collateral Agent shall have received evidence of the insurance required by the terms of Section 5.02 hereof; and

 

(i)                                     after the Closing Date, the Collateral Agent shall have received (i) such other Security Documents as may be required to be delivered pursuant to Section 5.11 or the Collateral Agreement, and (ii) upon reasonable request by the Administrative Agent, evidence of compliance with any other requirements of Section 5.11.

 

“Commitment Fee” shall have the meaning assigned to such term in Section 2.12(a).

 

“Commitments” shall mean with respect to any Lender, such Lender’s Revolving Facility Commitment and Term Facility Commitment.

 

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“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

 

“Communications” shall have the meaning assigned to such term in Section 9.19(a)(i).

 

“Company” shall have the meaning assigned to such term in the recitals hereto.

 

“Conduit Lender” shall mean any special purpose corporation organized and administered by any Lender for the purpose of making Loans otherwise required to be made by such Lender and designated by such Lender in a written instrument; provided that the designation by any Lender of a Conduit Lender shall not relieve the designating Lender of any of its obligations to fund a Loan under this Agreement if, for any reason, its Conduit Lender fails to fund any such Loan, and the designating Lender (and not the Conduit Lender) shall have the sole right and responsibility to deliver all consents and waivers required or requested under this Agreement with respect to its Conduit Lender; provided, further, that no Conduit Lender shall (a) be entitled to receive any greater amount pursuant to Sections 2.15, 2.16, 2.17 or 9.05 than the designating Lender would have been entitled to receive in respect of the extensions of credit made by such Conduit Lender unless the designation of such Conduit Lender is made with the prior written consent of the Borrower (not to be unreasonably withheld or delayed), which consent shall specify that it is being made pursuant to the proviso in the definition of “Conduit Lender” and provided that the designating Lender provides such information as the Borrower reasonably requests in order for the Borrower to determine whether to provide its consent, or (b) be deemed to have any Commitment.

 

“Consolidated Debt” at any date shall mean the sum of (without duplication) all Indebtedness (other than letters of credit or bank guarantees, to the extent undrawn, Cash Collateralized or backstopped) consisting of Indebtedness for borrowed money, Capitalized Lease Obligations and Disqualified Stock of the Borrower and the Subsidiaries determined on a consolidated basis on such date in accordance with GAAP.

 

“Consolidated Net Income” shall mean, with respect to any person for any period, the aggregate of the Net Income of such person and its subsidiaries for such period, on a consolidated basis; provided, however, that, without duplication,

 

(i)                                     any net after-tax extraordinary, nonrecurring or unusual gains or losses or income or expense or charge (less all fees and expenses relating thereto), any severance, relocation or other restructuring expenses, any expenses related to any New Project or any reconstruction, decommissioning, recommissioning or reconfiguration of fixed assets for alternative uses, fees, expenses or charges relating to facility closing costs, facility rebranding costs, curtailments or modifications to pension and post-retirement employee benefit plans, excess pension charges, acquisition integration costs, facility opening costs, project and contract start-up costs, business optimization costs, recruiting costs, signing, retention or completion bonuses, and expenses or charges related to any offering of Equity Interests or debt securities of the Borrower, Holdings or any Parent Entity, any Investment, acquisition, Disposition, recapitalization or incurrence, issuance, repayment, refinancing, amendment or modification of Indebtedness (in each case, whether or not successful), and any fees, expenses, charges or change in control payments related to the Transactions or the Repricing Date Transactions (including any costs relating to auditing prior periods, any transition-related expenses, and Transaction Expenses incurred before, on or after the Closing Date), in each case, shall be excluded,

 

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(ii)                                  any net after-tax income or loss from Disposed of, abandoned, closed or discontinued operations or fixed assets and any net after-tax gain or loss on the Dispositions of Disposed of, abandoned, closed or discontinued operations or fixed assets shall be excluded,

 

(iii)                               any net after-tax gain or loss (less all fees and expenses or charges relating thereto) attributable to business Dispositions or asset Dispositions other than in the ordinary course of business (as determined in good faith by the management of the Borrower) shall be excluded,

 

(iv)                              any net after-tax income or loss (less all fees and expenses or charges relating thereto) attributable to the early extinguishment of indebtedness, Swap Agreements or other derivative instruments shall be excluded,

 

(v)                                 (A)                               the Net Income for such period of any person that is not a subsidiary of such person, or is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting, shall be included only to the extent of the amount of dividends or distributions or other payments paid in cash (or to the extent converted into cash) to the referent person or a subsidiary thereof (other than an Unrestricted Subsidiary of such referent person) in respect of such period and (B) the Net Income for such period shall include any dividend, distribution or other payment in cash (or to the extent converted into cash) received by the referent person or a subsidiary thereof (other than an Unrestricted Subsidiary of such referent person) from any person in excess of, but without duplication of, the amounts included in subclause (A),

 

(vi)                              the cumulative effect of a change in accounting principles during such period shall be excluded,

 

(vii)                           effects of purchase accounting adjustments (including the effects of such adjustments pushed down to such person and its subsidiaries and including the effects of adjustments to (A) deferred rent, (B) Capitalized Lease Obligations or other obligations or deferrals attributable to capital spending funds with suppliers or (C) any other deferrals of income) in component amounts required or permitted by GAAP, resulting from the application of purchase accounting or the amortization or write-off of any amounts thereof, net of taxes, shall be excluded,

 

(viii)                        any impairment charges or asset write-offs, in each case pursuant to GAAP, and the amortization of intangibles and other fair value adjustments arising pursuant to GAAP, shall be excluded,

 

(ix)                              any noncash compensation charge or expenses realized or resulting from stock option plans, employee benefit plans or post-employment benefit plans, or grants or sales of stock, stock appreciation or similar rights, stock options, restricted stock, preferred stock or other rights shall be excluded,

 

(x)                                 accruals and reserves that are established or adjusted within twelve months after the Closing Date and that are so required to be established or adjusted in accordance with GAAP or as a result of adoption or modification of accounting policies shall be excluded,

 

(xi)                              noncash gains, losses, income and expenses resulting from fair value accounting required by the applicable standard under GAAP and related interpretation shall be excluded,

 

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(xii)                           any gain, loss, income, expense or charge resulting from the application of any LIFO method shall be excluded,

 

(xiii)                        any noncash charges for deferred tax asset valuation allowances shall be excluded,

 

(xiv)                       any currency translation gains and losses related to currency remeasurements of Indebtedness, and any net loss or gain resulting from Swap Agreements for currency exchange risk, shall be excluded,

 

(xv)                          any deductions attributable to minority interests shall be excluded,

 

(xvi)                       (A) the noncash portion of “straight-line” rent expense shall be excluded, (B) the cash portion of “straight-line” rent expense which exceeds the amount expensed in respect of such rent expense shall be included, (C) the noncash amortization of tenant allowances shall be excluded, (D) cash received from landlords for tenant allowances shall be included and (E) to the extent not already included in Net Income, the cash portion of sublease rentals received shall be included (for the avoidance of doubt, the net effect of the adjustments in this clause (xvi) as well as any related adjustments pursuant to clause (vii) above shall be to compute rent expense and rental income on a cash basis for purposes of determining Consolidated Net Income),

 

(xvii)                    (A) to the extent covered by insurance and actually reimbursed, or, so long as such person has made a determination that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer and only to the extent that such amount is (x) not denied by the applicable carrier in writing within 180 days and (y) in fact reimbursed within 365 days following the date of such evidence (with a deduction for any amount so added back to the extent not so reimbursed within such 365 days), expenses with respect to liability or casualty events or business interruption shall be excluded; and (B) amounts estimated in good faith to be received from insurance in respect of lost revenues or earnings in respect of liability or casualty events or business interruption shall be included (with a deduction for amounts actually received up to such estimated amount to the extent included in Net Income in a future period),

 

(xviii)                 without duplication, an amount equal to the amount of distributions actually made to any parent or equity holder of such person in respect of such period in accordance with Section 6.06(b)(v) shall be included as though such amounts had been paid as income taxes directly by such person for such period,

 

(xix)                       Capitalized Software Expenditures shall be excluded, and

 

(xx)                          any other costs, expenses or charges resulting from facility closures or sales, including income (or losses) from such facility closures or sales, shall be excluded.

 

“Consolidated Total Assets” shall mean, as of any date of determination, the total assets of the Borrower and the consolidated Subsidiaries without giving effect to any impairment or amortization of the amount of intangible assets since the Closing Date, determined on a consolidated basis in accordance with GAAP, as set forth on the consolidated balance sheet of the Borrower as of the last day of the fiscal quarter most recently ended for which financial statements have been (or were required to be) delivered pursuant to Sections 5.04(a) or 5.04(b), as applicable, calculated on a Pro Forma Basis after giving effect to any acquisition or Disposition of a person or assets that may have occurred on or after the last day of such fiscal quarter.

 

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“Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and “Controlling” and “Controlled” shall have meanings correlative thereto.

 

“Credit Event” shall have the meaning assigned to such term in Article IV.

 

“Cumulative Equity Proceeds Amount” shall mean, at any time of determination, an amount equal to, without duplication:

 

(a)                                 100% of the aggregate net proceeds (determined in a manner consistent with the definition of “Net Proceeds”) (including cash and the Fair Market Value (as determined in good faith by the Borrower) of tangible assets other than cash) received by the Borrower after the Closing Date from the issue or sale of Equity Interests of the Borrower to Holdings (excluding, without duplication, Excluded Contributions, Excluded Equity Proceeds, Permitted Cure Securities (including the Cure Amount) and Disqualified Stock) including Equity Interests of Holdings (other than Disqualified Stock) issued upon conversion of Indebtedness or Disqualified Stock to the extent the Borrower had received the Net Proceeds of such Indebtedness or Disqualified Stock, plus

 

(b)                                 100% of the aggregate amount of contributions to the capital of the Borrower by Holdings or any Parent Entity received in cash and the Fair Market Value (as determined in good faith by the Borrower) of tangible assets other than cash after the Closing Date (other than Excluded Contributions, Excluded Equity Proceeds, Permitted Cure Securities (including the Cure Amount) and Disqualified Stock).

 

“Cumulative Retained Excess Cash Flow Amount” shall mean, at any date of determination, an amount (which shall not be less than zero in the aggregate) determined on a cumulative basis equal to:

 

(a)                                 the aggregate cumulative sum of the Retained Percentage of Excess Cash Flow for each Excess Cash Flow Period; plus

 

(b)                                 for each Excess Cash Flow Interim Period ended prior to such date but as to which the corresponding Excess Cash Flow Period has not ended, an amount equal to the Retained Percentage of the Excess Cash Flow for such Excess Cash Flow Interim Period; plus

 

(c)                                  an amount (which may be negative) equal to (i) the Retained Percentage of Year To Date Excess Cash Flow for such Excess Cash Flow Period minus (ii) the aggregate of all amounts, if any, added pursuant to clause (b) above during any Excess Cash Flow Period.

 

“Cure Amount” shall have the meaning assigned to such term in Section 7.03.

 

“Cure Right” shall have the meaning assigned to such term in Section 7.03.

 

“Current Assets” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis at any date of determination, the sum of (a) all assets (other than cash and Permitted Investments or other cash equivalents) that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower and the Subsidiaries as current assets at such date of determination, other than amounts related to current or deferred Taxes based on income or profits and

 

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(b) gross accounts receivable comprising part of the Securitization Assets subject to such Permitted Securitization Financing.

 

“Current Liabilities” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis at any date of determination, all liabilities that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower and the Subsidiaries as current liabilities at such date of determination, other than (a) the current portion of any Indebtedness, (b) accruals of Interest Expense (excluding Interest Expense that is due and unpaid), (c) accruals for current or deferred Taxes based on income or profits, (d) accruals, if any, of transaction costs resulting from the Transactions or the Repricing Date Transactions, (e) accruals of any costs or expenses related to (i) severance or termination of employees prior to the Closing Date or (ii) bonuses, pension and other post-retirement benefit obligations, and (f) accruals for add-backs to EBITDA included in clauses (a)(iv), (a)(v) and (a)(vii) of the definition of such term.

 

“Debt Fund Affiliate Lender” shall mean entities managed by any of the Investors or funds advised by the Investors’ affiliated management companies that are primarily engaged in, or advise funds or other investment vehicles that are engaged in, making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit or securities in the ordinary course and for which no personnel making investment decisions in respect of any equity fund which has a direct or indirect equity investment in Holdings, the Borrower or the Subsidiaries has the right to make any investment decisions.

 

“Debt Service” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis for any period, Cash Interest Expense for such period plus scheduled principal amortization of Consolidated Debt for such period.

 

“Debtor Relief Laws” shall mean the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

 

“Declined Proceeds” shall have the meaning assigned to such term in Section 2.10(c)(i).

 

“Declining Lender” shall have the meaning assigned to such term in Section 2.10(c)(i).

 

“Deemed Date” shall have the meaning assigned to such term in Section 6.01.

 

“Default” shall mean any event or condition that upon notice, lapse of time or both would constitute an Event of Default.

 

“Defaulting Lender” shall mean, subject to Section 2.23(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any Issuing Bank or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit) within two Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent or any Issuing Bank in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such

 

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writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.23(b)) upon delivery of written notice of such determination to the Borrower, each Issuing Bank and each Lender.

 

“Designated Noncash Consideration” shall mean the Fair Market Value (as determined in good faith by the Borrower) of noncash consideration received by the Borrower or one of its Subsidiaries in connection with an Asset Sale that is so designated as Designated Noncash Consideration pursuant to a certificate of a Responsible Officer of the Borrower, setting forth the basis of such valuation, less the amount of cash or cash equivalents received in connection with a subsequent disposition of such Designated Noncash Consideration.

 

“Dispose” or “Disposed of” shall mean to convey, sell, lease, sell and leaseback, assign, farm-out, transfer or otherwise dispose of any property, business or asset, and “Disposition” and “Disposal” shall have meanings correlative thereto.

 

“Disqualified Stock” shall mean, with respect to any person, any Equity Interests of such person that, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Loan Obligations that are accrued and payable and the termination of the Commitments), (b) is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or in part, (c) provides for the scheduled payments of dividends in cash, or (d) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Stock, in each case, prior to the date that is 91 days after the Latest Maturity Date in effect at the time of issuance thereof (provided that only the portion of the Equity Interests that so mature or are mandatorily redeemable, are so convertible or exchangeable or are so redeemable at the option of the holder thereof prior to such date shall be deemed to be Disqualified Stock).  Notwithstanding the foregoing: (i) any Equity Interests issued to any employee or to any plan for the benefit of employees of the Borrower or the Subsidiaries or by any such plan to such employees shall not constitute Disqualified Stock solely because they may be required to be repurchased by the Borrower

 

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in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability and (ii) any class of Equity Interests of such person that by its terms authorizes such person to satisfy its obligations thereunder by delivery of Equity Interests that are not Disqualified Stock shall not be deemed to be Disqualified Stock.

 

“Dividends” shall have the meaning assigned to such term in Section 6.06.

 

“Dollar” and “$” shall mean lawful money of the United States of America.

 

“Dollar Equivalent” shall mean, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in any currency other than Dollars, the equivalent amount thereof in Dollars as determined by the Administrative Agent at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date or other applicable date of determination) for the purchase of Dollars with such currency.

 

“Domestic Subsidiary” shall mean any Subsidiary that is not a Foreign Subsidiary.

 

“EBITDA” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis for any period, the Consolidated Net Income of the Borrower and the Subsidiaries for such period plus (a) the sum of (in each case without duplication and to the extent the respective amounts described in subclauses (i) through (xiv) of this clause (a) reduced such Consolidated Net Income (and were not excluded therefrom) for the respective period for which EBITDA is being determined):

 

(i)                                     provision for Taxes based on income, profits or capital of the Borrower and the Subsidiaries for such period, including, without limitation, state, franchise and similar taxes and foreign withholding taxes (including penalties and interest related to taxes or arising from tax examinations),

 

(ii)                                  Interest Expense (and to the extent not included in Interest Expense, (x) all cash dividend payments (excluding items eliminated in consolidation) on any series of preferred stock or Disqualified Stock and (y) costs of surety bonds in connection with financing activities) of the Borrower and the Subsidiaries for such period,

 

(iii)                               depreciation and amortization expenses of the Borrower and the Subsidiaries for such period including, without limitation, the amortization of intangible assets, deferred financing fees, capitalized contract incentives, Capitalized Software Expenditures and amortization of unrecognized prior service costs and actuarial gains and losses related to pensions and other post-employment benefits,

 

(iv)                              business optimization expenses and other restructuring charges or reserves (which, for the avoidance of doubt, shall include, without limitation, the effect of inventory optimization programs, facility closure, facility consolidations, retention, severance, systems establishment costs, contract termination costs, future lease commitments and excess pension charges) and Pre-Opening Expenses,

 

(v)                                 any other noncash charges; provided that, for purposes of this subclause (v) of this clause (a), any noncash charges or losses shall be treated as cash charges or losses in any subsequent period during which cash disbursements attributable thereto are made (but excluding, for the avoidance of doubt, amortization of a prepaid cash item that was paid in a prior period),

 

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(vi)                              the amount of management, consulting, monitoring, transaction, advisory and similar fees and related expenses paid to the Investors or any Investor Affiliate (or any accruals related to such fees and related expenses) during such period not in contravention of this Agreement,

 

(vii)                           any expenses or charges (other than depreciation or amortization expense as described in the preceding clause (iii)) related to any issuance of Equity Interests, Investment, acquisition, New Project, Disposition, loan origination, recapitalization or the incurrence, modification or repayment of Indebtedness permitted to be incurred by this Agreement (including a refinancing thereof) (whether or not successful), including (w) such fees, expenses or charges related to the Senior Secured Notes, the First Amendment and this Agreement, (x) any amendment or other modification of the Obligations or other Indebtedness and (y) commissions, discounts, yield and other fees and charges (including any interest expense) related to any Permitted Securitization Financing,

 

(viii)                        the amount of loss or discount on sale of assets to a Special Purpose Securitization Subsidiary in connection with a Permitted Securitization Financing, including amortization of loan origination costs and amortization of portfolio discounts,

 

(ix)                              any costs or expense incurred pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement or any stock subscription or shareholder agreement, to the extent that such costs or expenses are funded with cash proceeds contributed to the capital of the Borrower or a Subsidiary Loan Party (other than contributions received from the Borrower or another Subsidiary Loan Party) or net cash proceeds of an issuance of Equity Interests of the Borrower (other than Disqualified Stock),

 

(x)                                 any payment for termination fees in respect of the termination of the HandsOn Management Agreements and payments in connection therewith, including any net present value of future payments,

 

(xi)                              the amount of any loss attributable to a New Project, until the date that is 12 months after the date of completing the construction, acquisition, assembling or creation of such New Project, as the case may be; provided that (A) such losses are reasonably identifiable and factually supportable and certified by a Responsible Officer of the Borrower and (B) losses attributable to such New Project after 12 months from the date of completing such construction, acquisition, assembling or creation, as the case may be, shall not be included in this clause (xi),

 

(xii)                           with respect to any joint venture that is not a Subsidiary and solely to the extent relating to any net income referred to in clause (v) of the definition of “Consolidated Net Income,” an amount equal to the proportion of those items described in clauses (i) and (ii) above relating to such joint venture corresponding to the Borrower’s and the Subsidiaries’ proportionate share of such joint venture’s Consolidated Net Income (determined as if such joint venture were a Subsidiary),

 

(xiii)                        [reserved], and

 

(xiv)                       all adjustments of the nature used in connection with the calculation of “Further Adjusted EBITDA” as set forth in “Summary Unaudited Pro Forma Financial and Other Information of Exela” under “Summary” in the Senior Secured Notes Offering Memorandum to the extent such adjustments, without duplication, continue to be applicable to such period,

 

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minus (b) the sum of (without duplication and to the extent the amounts described in this clause (b) increased such Consolidated Net Income for the respective period for which EBITDA is being determined) noncash items increasing Consolidated Net Income of the Borrower and the Subsidiaries for such period (but excluding the recognition of deferred revenue or any such items (A) in respect of which cash was received in a prior period or will be received in a future period or (B) which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges that reduced EBITDA in any prior period).

 

Notwithstanding anything to the contrary contained herein and subject to adjustments permitted hereunder with respect to acquisitions, Dispositions and other transactions occurring following the Closing Date and/or pursuant to the definition of “Pro Forma Basis,” for purposes of determining EBITDA under this Agreement, EBITDA for the fiscal quarter ended June 30, 2016 shall be deemed to be $83,129,000 million, EBITDA for the fiscal quarter ended September 30, 2016 shall be deemed to be $83,614,000 million, EBITDA for the fiscal quarter ended December 31, 2016 shall be deemed to be $89,054,000 million and EBITDA for the fiscal quarter ended March 31, 2017 shall be deemed to be $97,571,000 million.

 

“ECF Threshold Amount” shall have the meaning assigned to such term in Section 2.11(c).

 

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” shall mean any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“EMU Legislation” shall mean the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency.

 

“environment” shall mean ambient and indoor air, surface water and groundwater (including potable water, navigable water and wetlands), the land surface or subsurface strata, and natural resources such as flora and fauna.

 

“Environmental Laws” shall mean all applicable laws (including common law), rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions or binding agreements issued, promulgated or entered into by or with any Governmental Authority relating to the environment, the prevention, abatement or elimination of pollution, preservation or reclamation of natural resources, the generation, management (including handling, treatment, labeling, storage, and transportation), Release or threatened Release of, or exposure to, any Hazardous Material, or to human health and safety (to the extent related to exposure to Hazardous Materials).

 

“Equity Contribution” shall mean, in connection with the consummation of the Business Combination, the contribution by Parent, directly or indirectly, of at least $275,000,000 to the Borrower

 

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in the form of common equity, or other Equity Interests on terms reasonably acceptable to the Administrative Agent (it being understood that contributions in the form of perpetual preferred stock are acceptable to the Administrative Agent so long as such perpetual preferred stock does not include a cash dividend feature); provided that no less than $175,000,000 of the Equity Contribution shall be in the form of common equity; provided, further, that the Investors shall directly or indirectly (whether by contract or otherwise) control not less than 60% of the voting and economic interests in Parent on the Closing Date after giving effect to the Transactions.

 

“Equity Interests” of any person shall mean any and all shares, interests, rights to purchase or otherwise acquire, warrants, options, participations or other equivalents of or interests in (however designated) equity or ownership of such person, including any preferred stock, any limited or general partnership interest and any limited liability company membership interest, and any securities or other rights or interests convertible into or exchangeable for any of the foregoing.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated thereunder.

 

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated) that, together with Holdings, the Borrower or a Subsidiary, is treated as a single employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

 

“ERISA Event” shall mean (a) any Reportable Event; (b) the failure of any Plan  to meet the minimum funding standard of Section 412 or 430 of the Code or Section 302 or 303 of ERISA, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan, the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan; (d) the incurrence by Holdings, the Borrower, a Subsidiary or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by Holdings, the Borrower, a Subsidiary or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention, or the institution by the PBGC of proceedings, to terminate any Plan or to appoint a trustee to administer any Plan; (f) the incurrence by Holdings, the Borrower, a Subsidiary or any ERISA Affiliate of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (g) the receipt by Holdings, the Borrower, a Subsidiary or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from Holdings, the Borrower, a Subsidiary or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, in “critical” or “endangered” status  within the meaning of Section 432 of the Code or Section 305 of ERISA; or (h) the imposition of liability on Holdings, the Borrower, a Subsidiary or an ERISA Affiliate pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA.

 

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

 

“Euro” shall mean the lawful currency of the Participating Member States introduced in accordance with the EMU Legislation.

 

“Eurocurrency Borrowing” shall mean a Borrowing comprised of Eurocurrency Loans.

 

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“Eurocurrency Loan” shall mean any Eurocurrency Term Loan or Eurocurrency Revolving Loan.

 

“Eurocurrency Rate” shall mean for any Interest Period as to any Eurocurrency Loan, (i) the rate per annum determined by the Administrative Agent to be the offered rate which appears on the page of the Reuters Screen which displays the London interbank offered rate administered by ICE Benchmark Administration Limited (such page currently being the LIBOR01 page) for deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period in Dollars, determined as of approximately 11:00 a.m. (London, England time), two Business Days prior to the commencement of such Interest Period (the rate referenced in this clause (i), the “Eurocurrency Screen Rate”), or (ii) in the event the Eurocurrency Screen Rate does not appear on such page or service or if such page or service shall cease to be available, then the rate determined by the Administrative Agent to be the offered rate on such other page or other service which displays the Eurocurrency Rate for deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period in Dollars, determined as of approximately 11:00 a.m. (London, England time) two Business Days prior to the commencement of such Interest Period; provided that if Eurocurrency Rates are quoted under either of the preceding clauses (i) or (ii), but there is no such quotation for the Interest Period elected, the Eurocurrency Rate shall be equal to the Interpolated Rate; and provided, further, that if any such rate determined pursuant to the preceding clauses (i) or (ii) is below zero, the Eurocurrency Rate will be deemed to be zero.

 

“Eurocurrency Revolving Borrowing” shall mean a Borrowing comprised of Eurocurrency Revolving Loans.

 

“Eurocurrency Revolving Loan” shall mean any Revolving Facility Loan bearing interest at a rate determined by reference to the Adjusted Eurocurrency Rate in accordance with the provisions of Article II.

 

“Eurocurrency Screen Rate” shall have the meaning assigned to such term in the definition of “Eurocurrency Rate”.

 

“Eurocurrency Term Loan” shall mean any Term Loan bearing interest at a rate determined by reference to the Adjusted Eurocurrency Rate in accordance with the provisions of Article II.

 

“Event of Default” shall have the meaning assigned to such term in Section 7.01.

 

“Excess Cash Flow” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis for any Excess Cash Flow Period, EBITDA of the Borrower and the Subsidiaries on a consolidated basis for such Excess Cash Flow Period, minus, without duplication, (A):

 

(a)                                 Debt Service for such Excess Cash Flow Period (provided that with respect to any such amounts to be paid after the close of such Excess Cash Flow Period, any amount so deducted shall not be deducted again in a subsequent Excess Cash Flow Period), reduced by the aggregate principal amount of voluntary prepayments of Consolidated Debt (other than prepayments of the Loans) that would otherwise constitute scheduled principal amortization during such Excess Cash Flow Period;

 

(b)                                 the amount of any voluntary prepayment permitted hereunder of term Indebtedness (other than any Term Loans and Other First Lien Debt) during such Excess Cash Flow Period, in each case to the extent not financed, or intended to be financed, using the

 

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proceeds of, without duplication, the incurrence of Indebtedness, the sale or issuance of any Equity Interests, any Cumulative Equity Proceeds Amount or any Net Proceeds not otherwise required to prepay the Loans pursuant to Section 2.11 or the definition of the term “Net Proceeds,” in each case, to the extent that the amount of such prepayment is not already reflected in Debt Service;

 

(c)                                  (i) Capital Expenditures by the Borrower and the Subsidiaries on a consolidated basis during such Excess Cash Flow Period that are paid in cash and (ii) the aggregate consideration paid in cash during such Excess Cash Flow Period in respect of Permitted Business Acquisitions and other Investments permitted hereunder (excluding Permitted Investments, intercompany Investments in Subsidiaries and Investments made pursuant to Section 6.04(j)(Y)), in each case, to the extent not financed with the proceeds of, without duplication, the incurrence of Indebtedness, the sale or issuance of any Equity Interests, any component of Available Free Cash Flow Amount (which, in the case of Cumulative Retained Excess Cash Flow Amount, only to the extent attributable to a time prior to such Excess Cash Flow Period) or any Net Proceeds not otherwise required to prepay the Loans pursuant to Section 2.11 or the definition of the term “Net Proceeds” (less any amounts received in respect thereof as a return of capital);

 

(d)                                 Capital Expenditures that the Borrower or any Subsidiary shall, during such Excess Cash Flow Period, become obligated to make but that are not made during such Excess Cash Flow Period; provided that (i) any amount so deducted that will be paid after the close of such Excess Cash Flow Period shall not be deducted again in a subsequent Excess Cash Flow Period, and (ii) the Borrower shall deliver a certificate to the Administrative Agent not later than the date that financial statements are required to be delivered after the end of such Excess Cash Flow Period pursuant to Section 5.04(a) or (b), signed by a Responsible Officer of the Borrower and certifying that such Capital Expenditures and the delivery of the related equipment will be made in the following Excess Cash Flow Period; provided, further, that if any such Capital Expenditures so deducted are either (A) not so made in the following Excess Cash Flow Period or (B) made in the following Excess Cash Flow Period with the proceeds of, without duplication, the incurrence of Indebtedness, the sale or issuance of any Equity Interests, any component of Available Free Cash Flow Amount (which, in the case of Cumulative Retained Excess Cash Flow Amount, only to the extent attributable to a time prior to such Excess Cash Flow Period) or any Net Proceeds not otherwise required to prepay the Loans pursuant to Section 2.11 or the definition of the term “Net Proceeds,” the amount of such Capital Expenditures not so made or so financed shall be added to the calculation of Excess Cash Flow in such following Excess Cash Flow Period;

 

(e)                                  Taxes paid in cash by Holdings, the Borrower and the Subsidiaries on a consolidated basis during such Excess Cash Flow Period or that will be paid within nine months after the close of such Excess Cash Flow Period and for which reserves have been established, including income tax expense and withholding tax expense incurred in connection with cross-border transactions involving the Foreign Subsidiaries; provided that any amount so deducted that will be paid after the close of such Excess Cash Flow Period shall not be deducted again in a subsequent Excess Cash Flow Period;

 

(f)                                   an amount equal to any increase in Working Capital of the Borrower and the Subsidiaries for such Excess Cash Flow Period;

 

(g)                                  cash expenditures made in respect of Swap Agreements during such Excess Cash Flow Period, to the extent not reflected in the computation of EBITDA or Cash Interest Expense;

 

25

 

(h)                                 permitted dividends or distributions or repurchases of its Equity Interests paid in cash by the Borrower to Holdings during such Excess Cash Flow Period and permitted dividends paid by any Subsidiary to any person other than the Borrower or any of the Subsidiaries during such Excess Cash Flow Period, in each case in accordance with Section 6.06 (other than any permitted dividends or distributions made under Section 6.06(h));

 

(i)                                     without duplication of any exclusions to the calculation of Consolidated Net Income or EBITDA, amounts paid in cash during such Excess Cash Flow Period on account of (A) items that were accounted for as noncash reductions of Net Income in determining Consolidated Net Income or as noncash reductions of Consolidated Net Income in determining EBITDA of the Borrower and the Subsidiaries in a prior Excess Cash Flow Period and (B) reserves or accruals established in purchase accounting;

 

(j)                                    to the extent not deducted in the computation of Net Proceeds in respect of any asset disposition or condemnation giving rise thereto, the amount of any mandatory prepayment of Indebtedness (other than Indebtedness created hereunder or under any other Loan Document), together with any interest, premium or penalties required to be paid (and actually paid) in connection therewith to the extent that the income or gain realized from the transaction giving rise to such Net Proceeds exceeds the aggregate amount of all such mandatory prepayments and Capital Expenditures made with such Net Proceeds, and

 

(k)                                 the amount related to items that were added to or not deducted from Net Income in calculating Consolidated Net Income or were added to or not deducted from Consolidated Net Income in calculating EBITDA to the extent such items represented a cash payment (which had not reduced Excess Cash Flow upon the accrual thereof in a prior Excess Cash Flow Period), or an accrual for a cash payment, by the Borrower and the Subsidiaries or did not represent cash received by the Borrower and the Subsidiaries, in each case on a consolidated basis during such Excess Cash Flow Period,

 

plus, without duplication, (B):

 

(a)                                 an amount equal to any decrease in Working Capital of the Borrower and the Subsidiaries for such Excess Cash Flow Period;

 

(b)                                 all proceeds received during such Excess Cash Flow Period of Capitalized Lease Obligations, purchase money Indebtedness, Sale and Lease-Back Transactions pursuant to Section 6.03 and any other Indebtedness, in each case to the extent used to finance any Capital Expenditure (other than Indebtedness under this Agreement to the extent there is no corresponding deduction to Excess Cash Flow above in respect of the use of such Borrowings);

 

(c)                                  all amounts referred to in clause (A)(c) or (A)(d) above to the extent funded with, without duplication, (i) the proceeds of the sale or issuance of Equity Interests of, or capital contributions to, the Borrower after the Closing Date, (ii) any amount that would have constituted Net Proceeds under clause (a) of the definition of the term “Net Proceeds” if not so spent or (iii) any component of Available Free Cash Flow Amount (which, in the case of Cumulative Retained Excess Cash Flow Amount, only to the extent attributable to a time prior to such Excess Cash Flow Period), in each case to the extent there is a corresponding deduction from Excess Cash Flow above;

 

(d)                                 to the extent any permitted Capital Expenditures referred to in clause (A)(d) above and the delivery of the related equipment do not occur in the following Excess Cash

 

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Flow Period specified in the certificate of the Borrower provided pursuant to clause (A)(d) above, the amount of such Capital Expenditures that were not so made in such following Excess Cash Flow Period;

 

(e)                                  cash payments received in respect of Swap Agreements during such Excess Cash Flow Period to the extent (i) not included in the computation of EBITDA or (ii) such payments do not reduce Cash Interest Expense;

 

(f)                                   any extraordinary or nonrecurring gain realized in cash during such Excess Cash Flow Period, except to the extent such gain consists of Net Proceeds subject to Section 2.11(b);

 

(g)                                  to the extent deducted in the computation of EBITDA, cash interest income; and

 

(h)                                 the amount related to items that were deducted from or not added to Net Income in connection with calculating Consolidated Net Income or were deducted from or not added to Consolidated Net Income in calculating EBITDA to the extent either (x) such items represented cash received by the Borrower or any Subsidiary or (y) such items do not represent cash paid by the Borrower or any Subsidiary, in each case on a consolidated basis during such Excess Cash Flow Period;

 

provided that, for purposes of calculating Cumulative Retained Excess Cash Flow Amount for any Excess Cash Flow Interim Period, Excess Cash Flow Period as used in this definition shall be deemed to be Excess Cash Flow Interim Period.

 

“Excess Cash Flow Interim Period” shall mean (x) during any Excess Cash Flow Period, any one, two or three quarter period (taken as one accounting period) (a) commencing on the later of (i) the end of the immediately preceding Excess Cash Flow Period and (ii) if applicable, the end of any prior Excess Cash Flow Interim Period occurring during the same Excess Cash Flow Period and (b) ending on the last day of the most recently ended fiscal quarter (other than the last day of the fiscal year) during such Excess Cash Flow Period for which financial statements are available and (y) during the period from the Closing Date until the beginning of the first Excess Cash Flow Period, any period commencing on the Closing Date and ending on the last day of the most recently ended fiscal quarter for which financial statements are available.

 

“Excess Cash Flow Period” shall mean (a) the fiscal year of the Borrower ending on December 31, 2018 and (b) each fiscal year of the Borrower ended thereafter.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

 

“Excluded Contributions” shall mean cash, Permitted Investments or other assets (valued at their Fair Market Value as determined in good faith by the Borrower) received by the Borrower after the Closing Date from:

 

(a)                                 contributions in respect of its common stock, and

 

(b)                                 the sale (other than to a Subsidiary of the Borrower or pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Borrower or any of its Subsidiaries) of Qualified Equity Interests of the Borrower to Holdings,

 

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in each case, as designated as Excluded Contributions pursuant to an Officer’s Certificate executed by a Responsible Officer of the Borrower; provided that, notwithstanding anything to the contrary, Excluded Contributions shall not include any amounts included in Cumulative Equity Proceeds Amount, any Excluded Equity Proceeds and any Permitted Cure Securities (including the Cure Amount).

 

“Excluded Equity Proceeds” shall mean, during any fiscal year, the net proceeds (determined in a manner consistent with the definition of “Net Proceeds”) received by Holdings or any Parent Entity during such fiscal year from the sales and issuance of its Qualified Equity Interests so long as (a) all such proceeds are contributed in cash to the Borrower, (b) none of such proceeds are included in Cumulative Equity Proceeds Amount (or otherwise in the calculation of Available Free Cash Flow Amount), Excluded Contributions or Cure Amount, and (c) such Equity Interests are not Permitted Cure Securities.

 

“Excluded Indebtedness” shall mean all Indebtedness permitted to be incurred under Section 6.01 (as amended or waived from time to time).

 

“Excluded Property” shall have the meaning assigned to such term in Section 5.11(g).

 

“Excluded Securities” shall mean any of the following:

 

(a)                                 any Equity Interests or Indebtedness with respect to which the Administrative Agent and the Borrower reasonably agree that the cost or other consequences of pledging such Equity Interests or Indebtedness in favor of the Secured Parties under the Security Documents are likely to be excessive in relation to the value to be afforded thereby;

 

(b)                                 in the case of any pledge of voting Equity Interests of any CFC or FSHCO (in each case, that is owned directly by the Borrower or a Subsidiary Loan Party) to secure the Obligations, any voting Equity Interest of such CFC or FSHCO in excess of 65% of the outstanding voting Equity Interests;

 

(c)                                  any Equity Interests or Indebtedness to the extent the pledge thereof would be prohibited by any Requirement of Law;

 

(d)                                 any Equity Interests of any person that is not a Wholly Owned Subsidiary to the extent (A) that a pledge thereof to secure the Obligations is prohibited by (i) any applicable organizational documents, joint venture agreement or shareholder agreement or (ii) any other contractual obligation with an unaffiliated third party not in violation of Section 6.09(b) binding on such assets on the Closing Date or on the date of acquisition thereof and not entered into in contemplation thereof (other than in connection with the incurrence of Indebtedness of the type contemplated by Section 6.01(i)), (B) any organizational documents, joint venture agreement or shareholder agreement (or other contractual obligation referred to in subclause (A)(ii) above) prohibits such a pledge without the consent of any other party; provided that this clause (B) shall not apply if (1) such other party is a Loan Party or a Wholly Owned Subsidiary or (2) consent has been obtained to consummate such pledge (it being understood that the foregoing shall not be deemed to obligate the Borrower or any Subsidiary to obtain, or to seek to obtain, any such consent) and shall only apply for so long as such organizational documents, joint venture agreement or shareholder agreement or replacement or renewal thereof is in effect, or (C) a pledge thereof to secure the Obligations would give any other party (other than a Loan Party or a Wholly Owned Subsidiary) to any organizational documents, joint venture agreement or shareholder agreement governing such Equity Interests (or other contractual obligation referred to in subclause (A)(ii) above) the right to terminate its obligations thereunder;

 

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(e)                                  any Equity Interests of any Immaterial Subsidiary, any Unrestricted Subsidiary or any Special Purpose Securitization Subsidiary;

 

(f)                                   any Equity Interests of any Subsidiary of, or other Equity Interests owned by, a Foreign Subsidiary that is a CFC or FSHCO;

 

(g)                                  any Equity Interests of any Subsidiary to the extent that the pledge of such Equity Interests could reasonably be expected to result in material adverse tax consequences to the Borrower or any Subsidiary as determined in good faith by the Borrower in consultation with the Administrative Agent;

 

(h)                                 any Equity Interests or Indebtedness that are set forth on Schedule 1.01(a) to the Original Credit Agreement or that have been identified on or prior to the Closing Date in writing to the Agent by a Responsible Officer of the Borrower and agreed to by the Administrative Agent in writing;

 

(i)                                     (x) any Equity Interests owned by Holdings, other than Equity Interests in the Borrower and (y) any Indebtedness owned by Holdings to the extent permitted to be incurred under Section 6.08; and

 

(j)                                    any Margin Stock.

 

“Excluded Subsidiary” shall mean any of the following (except as otherwise provided in clause (b) of the definition of “Subsidiary Loan Party”):

 

(a)                                 each Immaterial Subsidiary,

 

(b)                                 each Domestic Subsidiary that is not a Wholly Owned Subsidiary (for so long as such Subsidiary remains a non-Wholly Owned Subsidiary),

 

(c)                                  each Domestic Subsidiary that is prohibited from Guaranteeing the Obligations by any Requirement of Law or that would require consent, approval, license or authorization of a Governmental Authority to Guarantee the Obligations (unless such consent, approval, license or authorization has been received); provided that, for the avoidance of doubt, such Domestic Subsidiary shall have no obligation to seek such consent, approval, license or authorization,

 

(d)                                 each Domestic Subsidiary that is prohibited by any applicable contractual requirement from Guaranteeing or granting Liens to secure the Obligations on the Closing Date or at the time such Subsidiary becomes a Subsidiary not in violation of Section 6.09(c) (and for so long as such restriction or any replacement or renewal thereof is in effect),

 

(e)                                  any Special Purpose Securitization Subsidiary,

 

(f)                                   any Foreign Subsidiary (i) that is a CFC or (ii) FSHCO,

 

(g)                                  any Domestic Subsidiary (i) that is a FSHCO or (ii) that is a direct or indirect Subsidiary of a CFC,

 

(h)                                 any other Domestic Subsidiary with respect to which, (x) the Administrative Agent and the Borrower reasonably agree that the cost or other consequences of providing a Guarantee of or granting Liens required by the Security Documents to secure the Obligations are

 

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likely to be excessive in relation to the value to be afforded thereby or (y) providing such a Guarantee or granting such Liens would result in material adverse tax consequences as determined in good faith by the Borrower in consultation with the Administrative Agent, and

 

(i)                                     each Unrestricted Subsidiary.

 

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such Guarantor or the grant of such security interest becomes effective with respect to such Swap Obligation, unless otherwise agreed between the Administrative Agent and the Borrower.  If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.

 

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, the following taxes, including interest, penalties or other additions thereto:

 

(a)                                 income taxes imposed on (or measured by) its net income or franchise taxes imposed on (or measured by) its net income by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located, including, in the case of each of the foregoing, any political subdivision thereof,

 

(b)                                 any branch profits taxes or any similar tax imposed by any jurisdiction described in clause (a) above,

 

(c)                                  any withholding tax that is attributable to a Lender’s failure to comply with Section 2.17(e),

 

(d)                                 any United States of America federal withholding tax pursuant to a law that is in effect and would apply to amounts payable hereunder by or on account of the Borrower at the time such Lender becomes a party to this Agreement (or designates a new Lending Office), other than pursuant to an assignment request by the Borrower under Section 2.19, and

 

(e)                                  any United States of America withholding tax that is imposed as a result of such recipient’s failure to comply with the requirements to establish an exemption from such withholding tax pursuant to FATCA.

 

except, in the case of clause (d) above, to the extent that (i) such Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts or indemnification payments from a Loan Party with respect to any such withholding tax pursuant to Section 2.17 or (ii) such withholding tax shall have resulted from the making of any payment to a location other than the office designated by the Administrative Agent or such Lender for the receipt of payments of the applicable type.

 

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“Existing Class Loans” shall have the meaning assigned to such term in Section 9.09(f).

 

“Existing Credit Agreements” shall mean, collectively, (i) the First Lien Credit Agreement, dated as of October 31, 2014, among SourceHOV, SourceHOV LLC, the lenders party thereto, Morgan Stanley Bank, N.A., as an L/C Issuer, and Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, (ii) the Second Lien Credit Agreement, dated as of October 31, 2014, among SourceHOV, SourceHOV LLC, the lenders party thereto and Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, (iii) the Credit Agreement, dated as of April 29, 2016, among FTS Parent Inc., the lenders party thereto and Bank of America, N.A., as administrative agent, (iv) the Credit Agreement, dated as of June 30, 2016, among TransCentra, Inc. and Opus Bank, (v) the First Lien Credit Agreement, dated as of October 1, 2013, among Novitex Intermediate, LLC, Novitex Acquisition, LLC, the lenders party thereto, and Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent, and (vi) the Second Lien Credit Agreement, dated as of October 1, 2013, among Novitex Intermediate, LLC, Novitex Acquisition, LLC, the lenders party thereto and Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent, in each case, as amended, restated, supplemented or otherwise modified prior to the Closing Date.

 

“Existing Roll-Over Letters of Credit” shall mean those letters of credit or bank guarantees issued and outstanding as of the Closing Date and set forth on Schedule 1.01(c) to the Original Credit Agreement, which shall each be deemed to constitute a Letter of Credit issued hereunder on the Closing Date.

 

“Extended Revolving Facility Commitment” shall have the meaning assigned to such term in Section 2.20(e).

 

“Extended Revolving Loans” shall have the meaning assigned to such term in Section 2.20(e).

 

“Extended Term Loan” shall have the meaning assigned to such term in Section 2.20(e).

 

“Extending Lender” shall have the meaning assigned to such term in Section 2.20(e).

 

“Extension” shall have the meaning assigned to such term in Section 2.20(e).

 

“Facility” shall mean a category of Commitments and extensions of credits thereunder.  For purposes hereof, each of the following comprises a separate Facility: (a) the Revolving Facility Commitments established on the Closing Date and the extensions of credit thereunder and (b) the Term B Loans in effect on the Repricing Effective Date.

 

“Fair Market Value” shall mean, with respect to any asset, group of assets or property, on any date of determination, the price that could be negotiated in an arm’s-length transaction between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction.

 

“FATCA” shall mean Sections 1471 through 1474 of the Code as of the Closing Date (or any amended or successor provisions that are substantively similar and not materially more onerous to comply with), any regulations thereunder or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any applicable intergovernmental agreements, treaties or conventions entered into in connection with the implementation of the foregoing.

 

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“Federal Funds Rate” shall mean, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

 

“Fee Letter” shall mean the Fee Letter, dated as of February 21, 2017, by and among Parent, Royal Bank of Canada, RBC Capital Markets, LLC, Credit Suisse AG, Cayman Islands Branch, Credit Suisse Securities (USA) LLC, Natixis, New York Branch, Natixis Securities Americas LLC, KKR Capital Markets LLC and KKR Corporate Lending LLC, as such Fee Letter may be amended, restated, supplemented or otherwise modified from time to time by the parties thereto or any replacement fee letter entered into between the Borrower and the Administrative Agent from time to time.

 

“Fees” shall mean the Commitment Fees, the L/C Participation Fees, the Issuing Bank Fees and the Administrative Agent Fees.

 

“Financial Covenant” shall mean the covenant of the Borrower set forth in Section 6.11.

 

“Financial Officer” of any person shall mean the Chief Financial Officer, principal accounting officer, Treasurer, Assistant Treasurer, Controller or other officer with reasonably equivalent duties of such person.

 

“First Amendment” shall have the meaning assigned to such term in the recitals hereto.

 

“First Lien/Second Lien Intercreditor Agreement” shall mean an intercreditor agreement substantially in the form of Exhibit D to the Original Credit Agreement, or such other customary form reasonably acceptable to the Administrative Agent and the Borrower, in each case, as such document may be amended, restated, supplemented or otherwise modified from time to time.

 

“Flood Documentation” shall mean, with respect to each Mortgaged Property located in the United States of America or any territory thereof, (i) a completed “life-of-loan” Federal Emergency Management Agency standard flood hazard determination (to the extent a Mortgaged Property is located in a Special Flood Hazard Area, together with a notice about Special Flood Hazard Area status and flood disaster assistance duly executed by the Borrower and the applicable Loan Party relating thereto) and (ii) evidence of flood insurance as required by Section 5.02(c) hereof and the applicable provisions of the Security Documents, each of which shall (A) be endorsed or otherwise amended to include a “standard” or “New York” lender’s loss payable or mortgagee endorsement (as applicable), (B) name the Collateral Agent, on behalf of the Secured Parties, as additional insured and loss payee/mortgagee, (C) identify the address of each property located in a Special Flood Hazard Area, the applicable flood zone designation and the flood insurance coverage and deductible relating thereto and (D) be otherwise in form and substance reasonably satisfactory to the Administrative Agent.

 

“Flood Insurance Laws” shall mean, collectively, (i) the National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto

 

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and (iii) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto.

 

“Foreign Subsidiary” shall mean any Subsidiary that is incorporated or organized under the laws of any jurisdiction other than the United States of America, any state thereof or the District of Columbia.

 

“Fronting Exposure” shall mean, at any time there is a Defaulting Lender, with respect to any Issuing Bank, such Defaulting Lender’s Applicable Percentage of the outstanding Letter of Credit obligations other than Letter of Credit obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized or backstopped in accordance with the terms hereof.

 

“FSHCO” shall mean any Subsidiary that owns no material assets other than the Equity Interests of one or more Foreign Subsidiaries that are CFCs and/or of one or more FSHCOs.

 

“GAAP” shall mean generally accepted accounting principles in effect from time to time in the United States of America, applied on a consistent basis, subject to the provisions of Section 1.02; provided that any reference to the application of GAAP in Sections 3.13(a), 3.20, 5.03, 5.07 and 6.02(e), to a Foreign Subsidiary (and not as a consolidated Subsidiary of the Borrower) shall mean generally accepted accounting principles in effect from time to time in the jurisdiction of organization of such Foreign Subsidiary.

 

“Governmental Authority” shall mean any federal, state, local or foreign court or governmental agency, authority, instrumentality or regulatory or legislative body.

 

“Guarantee” of or by any person (the “guarantor”) shall mean (a) any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other monetary obligation payable by another person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (iv) entered into for the purpose of assuring in any other manner the holders of such Indebtedness or other obligation of the payment thereof or to protect such holders against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of the guarantor securing any Indebtedness or other obligation (or any existing right, contingent or otherwise, of the holder of Indebtedness or other obligation to be secured by such a Lien) of any other person, whether or not such Indebtedness or other obligation is assumed by the guarantor; provided, however, that the term “Guarantee” shall not include endorsements of instruments for deposit or collection in the ordinary course of business or customary and reasonable indemnity obligations in effect on the Closing Date or entered into in connection with any acquisition or Disposition of assets permitted by this Agreement (other than such obligations with respect to Indebtedness).  The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the Indebtedness in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such person in good faith.

 

“guarantor” shall have the meaning assigned to such term in the definition of the term “Guarantee.”

 

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“Guarantors” shall mean the Loan Parties other than the Borrower.

 

“HandsOn Management Agreement” shall mean the SourceHOV Consulting Agreement and any other management agreement existing on the Closing Date among investment funds managed by Affiliates of HandsOn Global Management, LLC, on the one hand, and the Borrower and/or any of its Subsidiaries, on the other.

 

“Hazardous Materials” shall mean all pollutants, contaminants, wastes, chemicals, materials, substances and constituents that are subject to regulation or can give rise to liability under any Environmental Law, including explosive or radioactive substances, petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, and radon gas.

 

“HCM Group” shall have the meaning assigned to such term in the recitals hereto.

 

“Holdings” shall have the meaning assigned to such term in the preamble hereto.

 

“Holdings Guarantee and Pledge Agreement” shall mean the Holdings Guarantee and Pledge Agreement (First Lien), dated as of the Closing Date, as may be amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time, between Holdings and the Collateral Agent.

 

“Honor Date” shall have the meaning assigned to such term in Section 2.05(c).

 

“Immaterial Subsidiary” shall mean any Subsidiary that (a) did not, as of the last day of the fiscal quarter of the Borrower most recently ended for which financial statements have been (or were required to be) delivered pursuant to Sections 5.04(a) or 5.04(b), have assets with a value in excess of 5% of the Consolidated Total Assets or revenues representing in excess of 5% of total revenues of the Borrower and the Subsidiaries on a consolidated basis as of such date, and (b) taken together with all other Immaterial Subsidiaries as of such date, did not have assets with a value in excess of 10% of the Consolidated Total Assets or revenues representing in excess of 10% of total revenues of the Borrower and the Subsidiaries on a consolidated basis as of such date; provided that the Borrower may elect in its sole discretion to exclude as an Immaterial Subsidiary any Subsidiary that would otherwise meet the definition thereof. Each Immaterial Subsidiary as of the Closing Date shall be set forth in Schedule 1.01(b) to the Original Credit Agreement, and the Borrower shall update such Schedule from time to time after the Closing Date as necessary to reflect all Immaterial Subsidiaries at such time (the selection of Subsidiaries to be added to or removed from such Schedule to be made as the Borrower may determine).

 

“Increased Amount” of any Indebtedness shall mean any increase in the amount of such Indebtedness in connection with any accrual of interest, the accretion of accreted value, the amortization of original issue discount, the payment of interest in the form of additional Indebtedness or in the form of common stock of the Borrower, the accretion of original issue discount or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies.

 

“Incremental Amount” shall mean, at any time, the sum of:

 

(i)                                     the excess (if any) of (a) $225,000,000 over (b) the sum of (x) the aggregate outstanding principal amount of all Incremental Term Loans and Incremental Revolving Facility Commitments, in each case incurred or established after the Closing Date and outstanding at such time pursuant to Section 2.20 utilizing this clause (i) (other than Incremental Term Loans and

 

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Incremental Revolving Facility Commitments in respect of Refinancing Term Loans, Extended Term Loans, Extended Revolving Facility Commitments or Replacement Revolving Facility Commitments, respectively) and (y) the aggregate principal amount of Indebtedness outstanding pursuant to Section 6.01(y) at such time that was incurred utilizing this clause (i); plus

 

(ii)                                  any amounts so long as immediately after giving effect to the establishment of the commitments in respect thereof (or, at the option of the Borrower, immediately after giving effect to the incurrence of the Incremental Loans thereunder) utilizing this clause (ii) (and assuming such Incremental Revolving Facility Commitments established at such time utilizing this clause (ii) are fully drawn unless such commitments have been drawn or have otherwise been terminated), (a) in the case of Incremental Loans secured by Liens on the Collateral that rank pari passu in right of security with the Liens on the Collateral securing the Term B Loans or the Initial Revolving Facility Loans, the Net First Lien Leverage Ratio on a Pro Forma Basis is not greater than 3.75 to 1.00 and (b) in the case of Incremental Loans secured by Liens on the Collateral that rank junior in right of security to the Liens on the Collateral securing the Term B Loans and the Initial Revolving Facility Loans, the Net Secured Leverage Ratio on a Pro Forma Basis is not greater than 4.00 to 1.00; provided that, for purposes of this clause (ii), net cash proceeds of Incremental Loans incurred at such time shall not be netted against the applicable amount of Consolidated Debt for purposes of such calculation of the Net First Lien Leverage Ratio or the Net Secured Leverage Ratio at such time; plus

 

(iii)                               the aggregate amount of all voluntary prepayments of Term B Loans outstanding on the Closing Date and Revolving Facility Loans pursuant to Section 2.11(a) (and accompanied by a reduction of Revolving Facility Commitments pursuant to Section 2.08(b) in the case of a prepayment of Revolving Facility Loans) made prior to such time except to the extent funded with the proceeds of long-term Indebtedness (other than revolving Indebtedness);

 

provided that, for the avoidance of doubt, (A) amounts may be established or incurred utilizing clause (ii) above prior to utilizing clause (i) or (iii) above and (B) any calculation of the Net First Lien Leverage Ratio or the Net Secured Leverage Ratio on a Pro Forma Basis pursuant to clause (ii) above may be determined, at the option of the Borrower, without giving effect to any simultaneous establishment or incurrence of any amounts utilizing clause (i) or (iii) above.

 

“Incremental Assumption Agreement” shall mean an Incremental Assumption Agreement in form and substance reasonably satisfactory to the Administrative Agent, among the Borrower, the Administrative Agent and, if applicable, one or more Incremental Term Lenders and/or Incremental Revolving Facility Lenders.

 

“Incremental Commitment” shall mean an Incremental Term Loan Commitment or an Incremental Revolving Facility Commitment.

 

“Incremental Loan” shall mean an Incremental Term Loan or an Incremental Revolving Facility Loan.

 

“Incremental Revolving Facility Commitment” shall mean the commitment of any Lender, established pursuant to Section 2.20, to make Incremental Revolving Facility Loans to the Borrower.

 

“Incremental Revolving Facility Lender” shall mean a Lender with an Incremental Revolving Facility Commitment or an outstanding Incremental Revolving Facility Loan.

 

35

 

“Incremental Revolving Facility Loans” shall mean (i) Revolving Facility Loans made by one or more Revolving Facility Lenders to the Borrower pursuant to an Incremental Revolving Facility Commitment to make additional Initial Revolving Facility Loans and (ii) to the extent permitted by Section 2.20 and provided for in the relevant Incremental Assumption Agreement, Other Revolving Facility Loans (including in the form of Extended Revolving Loans or Replacement Revolving Loans, as applicable), or (iii) any of the foregoing.

 

“Incremental Term Borrowing” shall mean a Borrowing comprised of Incremental Term Loans.

 

“Incremental Term Facility” shall mean any Class of Incremental Term Loan Commitments and the Incremental Term Loans made thereunder.

 

“Incremental Term Lender” shall mean a Lender with an Incremental Term Loan Commitment or an outstanding Incremental Term Loan.

 

“Incremental Term Loan Commitment” shall mean the commitment of any Lender, established pursuant to Section 2.20, to make Incremental Term Loans to the Borrower.

 

“Incremental Term Loan Installment Date” shall have, with respect to any Class of Incremental Term Loans established pursuant to an Incremental Assumption Agreement, the meaning assigned to such term in Section 2.10(a)(ii).

 

“Incremental Term Loans” shall mean (i) Term Loans made by one or more Lenders to the Borrower pursuant to Section 2.01(c) consisting of additional Term B Loans and (ii) to the extent permitted by Section 2.20 and provided for in the relevant Incremental Assumption Agreement, Other Term Loans (including in the form of Extended Term Loans or Refinancing Term Loans, as applicable), or (iii) any of the foregoing..

 

“Indebtedness” of any person shall mean, if and to the extent (other than with respect to clause (i)) the same would constitute indebtedness or a liability on a balance sheet prepared in accordance with GAAP, without duplication, (a) all obligations of such person for borrowed money, (b) all obligations of such person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such person under conditional sale or other title retention agreements relating to property or assets purchased by such person, (d) all obligations of such person issued or assumed as the deferred purchase price of property or services (other than such obligations accrued in the ordinary course), to the extent that the same would be required to be shown as a long term liability on a balance sheet prepared in accordance with GAAP, (e) all Capitalized Lease Obligations of such person, (f) all net payments that such person would have to make in the event of an early termination, on the date Indebtedness of such person is being determined, in respect of outstanding Swap Agreements, (g) the principal component of all obligations, contingent or otherwise, of such person as an account party in respect of letters of credit, (h) the principal component of all obligations of such person in respect of bankers’ acceptances, (i) all Guarantees by such person of Indebtedness described in clauses (a) to (h) above and (j) the amount of all obligations of such person with respect to the redemption, repayment or other repurchase of any Disqualified Stock (excluding accrued dividends that have not increased the liquidation preference of such Disqualified Stock); provided that Indebtedness shall not include (A) trade and other ordinary-course payables, accrued expenses, and intercompany liabilities arising in the ordinary course of business, (B) prepaid or deferred revenue, (C) purchase price holdbacks arising in the ordinary course of business in respect of a portion of the purchase prices of an asset to satisfy unperformed obligations of the seller of such asset, (D) Obligations under or in respect of Permitted Securitization Financings, (E) earn-out obligations until such obligations become a liability on the balance sheet of such person in accordance

 

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with GAAP, (F) obligations in respect of Third Party Funds, (G) in the case of the Borrower and its Subsidiaries, (I) all intercompany Indebtedness having a term not exceeding 364 days (inclusive of any roll-over or extensions of terms) and made in the ordinary course of business and (II) intercompany liabilities in connection with the cash management, tax and accounting operations of the Borrower and the Subsidiaries, (H) obligations under or in respect of the Business Combination Agreement or (I) any Claims Administration Indebtedness of such person (except to the extent that any such Claims Administration Indebtedness exceeds the Claims Administration Investments of such person). The Indebtedness of any person shall include the Indebtedness of any partnership in which such person is a general partner, other than to the extent that the instrument or agreement evidencing such Indebtedness expressly limits the liability of such person in respect thereof.

 

“Indemnified Taxes” shall mean all Taxes other than Excluded Taxes and Other Taxes.

 

“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

 

“Ineligible Institution” shall mean (i) the persons identified as “Disqualified Lenders” in writing to the Joint Lead Arrangers by Parent on or prior to February 21, 2017 and (ii) the persons as may be identified in writing to the Administrative Agent by the Borrower from time to time thereafter (in the case of this clause (ii), solely in respect of bona fide business competitors of the Borrower (in the good faith determination of the Borrower)), by delivery of a notice thereof to the Administrative Agent setting forth such person or persons (or the person or persons previously identified to the Administrative Agent that are to be no longer considered “Ineligible Institutions”) which designations shall not apply retroactively to disqualify any persons that have previously acquired an assignment or participation in the Loans.

 

“Information” shall have the meaning assigned to such term in Section 3.14(a).

 

“Information Memorandum” shall mean the Confidential Information Memorandum, dated June 15, 2017, as modified or supplemented prior to the Closing Date.

 

“Initial Revolving Facility Loan” shall mean a Revolving Facility Loan made (i) pursuant to the Revolving Facility Commitments in effect on the Closing Date (as the same may be amended from time to time in accordance with this Agreement) or (ii) pursuant to any Incremental Revolving Facility Commitment on the same terms as the Revolving Facility Loans referred to in clause (i) of this definition.

 

“Intellectual Property” shall have the meaning assigned to such term in the Collateral Agreement.

 

“Intercreditor Agreement” shall have the meaning assigned to such term in Section 9.21.

 

“Interest Coverage Ratio” shall mean, on any date, the ratio of (a) EBITDA to (b) Cash Interest Expense, in each case, for the Test Period most recently ended as of such date, all determined on a consolidated basis in accordance with GAAP; provided that the Interest Coverage Ratio shall be determined for the relevant Test Period on a Pro Forma Basis.

 

“Interest Election Request” shall mean a request by the Borrower to convert or continue a Term Borrowing or Revolving Facility Borrowing in accordance with Section 2.07 and substantially in the form of Exhibit B to the Original Credit Agreement or another form approved by the Administrative Agent.

 

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“Interest Expense” shall mean, with respect to any person for any period, the sum of (a) gross interest expense of such person for such period on a consolidated basis, including the portion of any payments or accruals with respect to Capitalized Lease Obligations allocable to interest expense and excluding amortization of deferred financing fees and original issue discount, debt issuance costs, commissions, fees and expenses, expensing of any bridge, commitment or other financing fees and noncash interest expense attributable to movement in mark to market of obligations in respect of Swap Agreements or other derivatives (in each case permitted hereunder) under GAAP, and (b) capitalized interest of such person, minus interest income for such period.  For purposes of the foregoing, gross interest expense shall be determined after giving effect to any net payments made or received and costs incurred by the Borrower and the Subsidiaries with respect to Swap Agreements, and interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by the Borrower to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP.

 

“Interest Payment Date” shall mean, (a) with respect to any Eurocurrency Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurocurrency Borrowing with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date had successive Interest Periods of three months’ duration been applicable to such Borrowing and, in addition, the date of any refinancing or conversion of such Borrowing with or to a Borrowing of a different Type and (b) with respect to any ABR Loan, the last Business Day of each calendar quarter (being the last Business Day of March, June, September and December of each year).

 

“Interest Period” shall mean, as to any Eurocurrency Borrowing, the period commencing on the date of such Borrowing or on the last day of the immediately preceding Interest Period applicable to such Borrowing, as applicable, and ending on the numerically corresponding day (or, if there is no numerically corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6 months thereafter (or 12 months, if at the time of the relevant Borrowing, all relevant Lenders make interest periods of such length available or any shorter period), as the Borrower may elect; provided, however, that if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day; provided, further, notwithstanding anything to the contrary contained in this Agreement, the initial Interest Period with respect to the Term B Loans made or converted on the Repricing Effective Date shall be the period commencing on the Repricing Effective Date and ending on the date set forth in the Borrowing Request delivered in connection with the Repricing Date Transactions.  Interest shall accrue from and including the first day of an Interest Period to but excluding the last day of such Interest Period.

 

“Interpolated Rate” means, in relation to the Eurocurrency Rate, the rate which results from interpolating on a linear basis between:

 

(a)                                 the applicable Eurocurrency Rate for the longest period (for which that Eurocurrency Rate is available) which is less than the Interest Period of that Loan; and

 

(b)                                 the applicable Eurocurrency Rate for the shortest period (for which that Eurocurrency Rate is available) which exceeds the Interest Period of that Loan,

 

each as of approximately 11:00 a.m. (London, England time) two Business Days prior to the commencement of such Interest Period of that Loan.

 

“Investment” shall have the meaning set forth in Section 6.04.

 

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“Investor” shall mean, collectively, investment funds managed by Affiliates of Apollo Global Management, LLC, investment funds managed by Affiliates of HandsOn Global Management, LLC, and other co-investors in the Equity Interests of Parent as of the Closing Date.

 

“Investor Affiliates” shall mean each Affiliate of the Investors that is neither a “portfolio company” (which means a company actively engaged in providing goods or services to unaffiliated customers), whether or not controlled, nor a company controlled by a “portfolio company”.

 

“ISP” shall mean, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

 

“Issuer Documents” shall have the meaning set forth in Section 2.05(a).

 

“Issuing Bank” shall mean, as the context may require, (i) each Revolving Facility Lender, (ii) for purposes of the Existing Roll-Over Letters of Credit, the Issuing Banks set forth on Schedule 1.01(c) to the Original Credit Agreement and (iii) each other Issuing Bank designated pursuant to Section 2.05(k), in each case in its capacity as an issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 2.05(j); provided that, in the case of clause (iii) above, the L/C Commitment with respect to each Issuing Bank shall be reduced on a ratable basis by the amount of the L/C Commitment allocated to such new Issuing Bank.  An Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.

 

“Issuing Bank Fees” shall have the meaning assigned to such term in Section 2.12(b).

 

“Joint Lead Arrangers” shall have the meaning assigned to such term in the preamble hereto.

 

“Junior Financing” shall mean any Indebtedness that is subordinated in right of payment to the Loan Obligations.

 

“Junior Liens” shall mean Liens on the Collateral that are junior to the Liens thereon securing the Term B Loans (and other Loan Obligations that are pari passu with the Term B Loans) pursuant to a Permitted Junior Intercreditor Agreement (it being understood that Junior Liens are not required to be pari passu with other Junior Liens, and that Indebtedness secured by Junior Liens may have Liens that are senior in priority to, pari passu with, or junior in priority to, other Liens constituting Junior Liens).

 

“Laws” shall mean, collectively, all international, foreign, federal, state and local statutes, treaties, rules, regulations, ordinances, codes and binding administrative or judicial precedents or authorities, including the binding interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of any Governmental Authority, in each case having the force of law.

 

“L/C Advance” shall mean, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

 

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“L/C Borrowing” shall mean an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Borrowing.

 

“L/C Commitment” shall mean, with respect to each Issuing Bank, the commitment of such Issuing Bank to issue Letters of Credit pursuant to Section 2.05.  The initial aggregate amount of the L/C Commitments of all Issuing Banks is $30,000,000 (calculated, in the case of Alternate Currency Letters of Credit, based on the Dollar Equivalent thereof) or such larger amount not to exceed the Revolving Facility Commitment as the Administrative Agent and the Issuing Banks may agree or such smaller amount as the Borrower and the Administrative Agent and the Issuing Banks shall agree.

 

“L/C Disbursement” shall mean a payment or disbursement made by an Issuing Bank pursuant to a Letter of Credit.

 

“L/C Exposure” of any Class shall mean, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit applicable to such Class at such time (calculated, in the case of Alternate Currency Letters of Credit, based on the Dollar Equivalent thereof) and (b) the aggregate amount of all L/C Disbursements applicable to such Class that have not yet been reimbursed by or on behalf of the Borrower at such time (calculated, in the case of Alternate Currency Letters of Credit, based on the Dollar Equivalent thereof).  The L/C Exposure of any Class of any Revolving Facility Lender at any time shall be its Applicable Percentage of the total L/C Exposure applicable to such Class at such time.

 

“L/C Participation Fee” shall have the meaning assigned to such term in Section 2.12(b).

 

“Latest Maturity Date” shall mean, at any date of determination, the latest of the latest Revolving Facility Maturity Date and the latest Term Facility Maturity Date, in each case then in effect on such date of determination.

 

“Lender” shall mean each Revolving Facility Lender under the Original Credit Agreement immediately prior to the Repricing Effective Date (including each Revolving Facility Lender listed on Schedule 2.01 to the Original Credit Agreement) and each 2018 Term Lender (in each case, other than any such person that has ceased to be a party hereto pursuant to an Assignment and Acceptance in accordance with Section 9.04), as well as any person that becomes a “Lender” hereunder pursuant to Section 9.04 or Section 2.20, including, in respect of Letters of Credit, each Issuing Bank.

 

“Lending Office” shall mean, as to any Lender, the applicable branch, office or Affiliate of such Lender designated by such Lender to make Loans to the Borrower.

 

“Letter of Credit” shall mean any letter of credit or bank guarantee issued pursuant to Section 2.05, including any Alternate Currency Letter of Credit.  Each Existing Roll-Over Letter of Credit shall be deemed to constitute a Letter of Credit issued hereunder on the Closing Date for all purposes of the Loan Documents.

 

“Letter of Credit Application” shall mean an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by any applicable Issuing Bank.

 

“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust, lien, hypothecation, pledge, charge, security interest or similar monetary encumbrance in or on such asset and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing)

 

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relating to such asset; provided that in no event shall an operating lease or an agreement to sell be deemed to constitute a Lien.

 

“Loan Documents” shall mean this Agreement, the Letters of Credit, the Subsidiary Guarantee Agreement, the Security Documents, each Incremental Assumption Agreement (including the First Amendment), any Intercreditor Agreement, any Note issued under Section 2.09(e), and solely for the purposes of 7.01(c) hereof, the Fee Letter.

 

“Loan Obligations” shall mean (a) the due and punctual payment by the Borrower of (i) the unpaid principal of and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans made to the Borrower under this Agreement, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Borrower under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of reimbursement of disbursements, interest thereon (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) and obligations to provide Cash Collateral and (iii) all other monetary obligations of the Borrower owed under or pursuant to this Agreement and each other Loan Document, including obligations to pay fees, expense reimbursement obligations and indemnification obligations, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), and (b) the due and punctual payment of all obligations of each other Loan Party under or pursuant to each of the Loan Documents (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding).

 

“Loan Parties” shall mean Holdings, the Borrower and the Subsidiary Loan Parties.

 

“Loans” shall mean the Term Loans and the Revolving Facility Loans.

 

“Local Time” shall mean New York City time; provided that, with respect to any Alternate Currency Loan, “Local Time” shall mean the local time of the applicable Lending Office.

 

“Majority Lenders” of any Facility shall mean, at any time, Lenders under such Facility having Loans and unused Commitments representing more than 50% of the sum of all Loans outstanding under such Facility and unused Commitments under such Facility at such time (subject to the last paragraph of Section 9.09(b)).

 

“Management Group” shall mean the group consisting of the directors, executive officers and other management personnel of the Borrower, Holdings or any Parent Entity, as the case may be, on the Closing Date after giving effect to the Transactions together with (a) any new directors whose election by such Boards of Directors or whose nomination for election by the shareholders of the Borrower, Holdings or any Parent Entity, as the case may be, was approved by a vote of a majority of the directors of the Borrower, Holdings or any Parent Entity, as the case may be, then still in office who were either directors on the Closing Date after giving effect to the Transactions or whose election or nomination was previously so approved and (b) executive officers and other management personnel of the Borrower, Holdings or any Parent Entity, as the case may be, hired at a time when the directors on the Closing Date after giving effect to the Transactions together with the directors so approved constituted a majority of the directors of the Borrower, Holdings or any Parent Entity, as the case may be.

 

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“Margin Stock” shall have the meaning assigned to such term in Regulation U.

 

“Material Adverse Effect” shall mean a material adverse effect on the business, property, operations or financial condition of the Borrower and its Subsidiaries, taken as a whole, or the validity or enforceability of any of the Loan Documents or the rights and remedies of the Administrative Agent and the Lenders thereunder.

 

“Material Indebtedness” shall mean Indebtedness (other than Loans and Letters of Credit) of any one or more of the Borrower or any Subsidiary in an aggregate principal amount exceeding $75,000,000; provided that in no event shall any Permitted Securitization Financing be considered Material Indebtedness.

 

“Material Real Property” shall mean any parcel or parcels of Real Property located in the United States of America now or hereafter owned in fee by the Borrower or any Subsidiary Loan Party and having a Fair Market Value (on a per-property basis) (as determined in good faith by the Borrower) in excess of $10,000,000 as of (x) the Closing Date, for Real Property now owned, as determined by the Pledgor in good faith or (y) the date of acquisition, for Real Property acquired after the Closing Date, as determined by the purchase price; provided that “Material Real Property” shall not include (i) any Real Property in respect of which the Borrower or a Subsidiary Loan Party does not own the land in fee simple or (ii) any Real Property which the Borrower or a Subsidiary Loan Party leases to a third party.

 

“Material Subsidiary” shall mean any Subsidiary other than an Immaterial Subsidiary.

 

“Maximum Rate” shall have the meaning assigned to such term in Section 9.10.

 

“Moody’s” shall mean Moody’s Investors Service, Inc. and its successors and assigns.

 

“Mortgaged Properties” shall mean the Material Real Properties owned in fee by the Borrower or any Subsidiary Loan Party that are identified as such on Schedule 1.01(e) to the Original Credit Agreement (the “Closing Date Mortgaged Properties”) and each additional Material Real Property encumbered by a Mortgage pursuant to Section 5.11.

 

“Mortgages” shall mean any Additional Mortgage and the mortgages, debentures, hypothecs, deeds of trust, deeds to secure debt, assignments of leases and rents, and other security documents delivered pursuant to Section 5.11, amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time, with respect to Mortgaged Properties, each in form and substance reasonably satisfactory to the Administrative Agent and the Borrower.

 

“Multiemployer Plan” shall mean a multiemployer plan as defined in Section 4001(a)(3) of ERISA to which Holdings, the Borrower or any Subsidiary or any ERISA Affiliate (other than one considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Code Section 414) is making or accruing an obligation to make contributions, or has within any of the preceding six plan years made or accrued an obligation to make contributions.

 

“Net First Lien Leverage Ratio” shall mean, on any date, the ratio of (A) (i) the sum of, without duplication, (x) the aggregate principal amount of any Consolidated Debt consisting of Loan Obligations outstanding as of the last day of the Test Period most recently ended as of such date (other than Loan Obligations secured only by Junior Liens) and (y) the aggregate principal amount of any other Consolidated Debt of the Borrower and its Subsidiaries outstanding as of the last day of such Test Period that is then secured by Liens on the Collateral that are Other First Liens less (ii) without duplication, the Unrestricted Cash and unrestricted Permitted Investments of the Borrower and its Subsidiaries as of the

 

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last day of such Test Period to (B) EBITDA for such Test Period, all determined on a consolidated basis in accordance with GAAP; provided that the Net First Lien Leverage Ratio shall be determined for the relevant Test Period on a Pro Forma Basis.

 

“Net Income” shall mean, with respect to any person, the net income (loss) of such person, determined in accordance with GAAP and before any reduction in respect of preferred stock dividends.

 

“Net Proceeds” shall mean:

 

(a)                                 100% of the cash proceeds actually received by the Borrower or any of its Subsidiaries (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise and including casualty insurance settlements and condemnation awards, but only as and when received) from any Asset Sale under Section 6.05(h), or any Casualty Event, in each case, net of (i) attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums, and related search and recording charges, transfer taxes, deed or mortgage recording taxes, required debt payments and required payments of other obligations relating to the applicable asset (other than pursuant hereto), other customary expenses and brokerage, consultant and other customary fees actually incurred in connection therewith, (ii) Taxes paid or payable (in the good faith determination of the Borrower) as a result thereof (including, without duplication, the amount of any distributions in respect thereof pursuant to Section 6.06(b)(iii) or Section 6.06(b)(v)), (iii) the amount of any reasonable reserve established in accordance with GAAP against any adjustment to the sale price or any liabilities (other than any taxes deducted pursuant to clause (i) or (ii) above) (x) related to any of the applicable assets and (y) retained by the Borrower or any of the Subsidiaries including, without limitation, pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations (however, the amount of any subsequent reduction of such reserve (other than in connection with a payment in respect of any such liability) shall be deemed to be cash proceeds of such Asset Sale or Casualty Event occurring on the date of such reduction) and (iv) payments made to holders of minority interests in Subsidiaries that are joint ventures as a result of such Asset Sale; provided that the Borrower or any Subsidiary may deliver a certificate of a Responsible Officer of the Borrower to the Administrative Agent promptly after receipt of any such proceeds setting forth the Borrower’s or such Subsidiary’s intention to use, or to commit to use, any portion of such proceeds, to acquire, maintain, develop, construct, improve, upgrade or repair assets useful in the business of the Borrower and the Subsidiaries or to make investments in Permitted Business Acquisitions or Investments permitted by Section 6.04 or to reimburse the cost of any of the foregoing incurred on or after the date on which the Asset Sale or Casualty Event giving rise to such proceeds was contractually committed, in each case, if such certificate shall have been delivered, within twelve months of such receipt, such portion of such proceeds shall not constitute Net Proceeds except to the extent (A) not so used (or committed to be used) within such twelve-month period or (B) if committed to be used within such twelve-month period, not so used within 18 months of such receipt); provided, further, that (x) no net cash proceeds realized in a single transaction or series of related transactions shall constitute Net Proceeds unless such net cash proceeds shall exceed $2,500,000   (and thereafter only net cash proceeds in excess of such amount shall constitute Net Proceeds) and (y) no net cash proceeds shall constitute Net Proceeds in any fiscal year until the aggregate amount of all such net cash proceeds in such fiscal year shall exceed $5,000,000 (and thereafter only net cash proceeds in excess of such amount shall constitute Net Proceeds); provided, still further, that pending such reinvestment, such proceeds may be applied to temporarily reduce outstanding Revolving Facility Loans; and

 

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(b)                                 100% of the cash proceeds from the incurrence, issuance or sale by the Borrower or any of its Subsidiaries of any Indebtedness (other than Excluded Indebtedness), net of all taxes and fees (including investment banking fees), commissions, costs and other expenses, in each case incurred in connection with such incurrence, issuance or sale.

 

For purposes of calculating the amount of Net Proceeds, fees, commissions and other costs and expenses payable to Holdings or the Borrower or any Affiliate of either of them shall be disregarded, except for financial advisory fees customary in type and amount paid to Affiliates of the Investors.

 

“Net Secured Leverage Ratio” shall mean, on any date, the ratio of (A) (i) the sum of, without duplication, (x) the aggregate principal amount of any Consolidated Debt consisting of Loan Obligations outstanding as of the last day of the Test Period most recently ended as of such date and (y) the aggregate principal amount of any other Consolidated Debt of the Borrower and its Subsidiaries outstanding as of the last day of such Test Period that is then secured by Liens on the Collateral less (ii) without duplication, the Unrestricted Cash and unrestricted Permitted Investments of the Borrower and its Subsidiaries as of the last day of such Test Period, to (B) EBITDA for such Test Period, all determined on a consolidated basis in accordance with GAAP; provided that the Net Secured Leverage Ratio shall be determined for the relevant Test Period on a Pro Forma Basis.

 

“Net Total Leverage Ratio” shall mean, on any date, the ratio of (A) (i) the aggregate principal amount of any Consolidated Debt of the Borrower and its Subsidiaries outstanding as of the last day of the Test Period most recently ended as of such date less (ii) without duplication, the Unrestricted Cash and unrestricted Permitted Investments of the Borrower and its Subsidiaries as of the last day of such Test Period, to (B) EBITDA for such Test Period, all determined on a consolidated basis in accordance with GAAP; provided that the Net Total Leverage Ratio shall be determined for the relevant Test Period on a Pro Forma Basis.

 

“New Class Loans” shall have the meaning assigned to such term in Section 9.09(f).

 

“New Project” shall mean (x) each contract or project with respect to new customers and any expansions of contracts or projects with respect to existing customers and (y) each creation (in one or a series of related transactions) of a business unit to the extent such business unit commences operations or each expansion (in one or a series of related transactions) of business into a new market.

 

“Non-Consenting Lender” shall have the meaning assigned to such term in Section 2.19(c).

 

“Note” shall have the meaning assigned to such term in Section 2.09(e).

 

“Novitex” shall have the meaning assigned to such term in the recitals hereto.

 

“Novitex Merger” shall have the meaning assigned to such term in the recitals hereto.

 

“Novitex Merger Sub” shall have the meaning assigned to such term in the recitals hereto.

 

“Novitex Parent” shall have the meaning assigned to such term in the recitals hereto.

 

“Obligations” shall mean, collectively, (a) the Loan Obligations, (b) obligations in respect of any Secured Cash Management Agreement and (c) obligations in respect of any Secured Swap Agreement.

 

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“OFAC” shall have the meaning provided in Section 3.23(b).

 

“Original Credit Agreement” shall have the meaning assigned to such term in the recitals hereto.

 

“Other First Lien Debt” shall mean obligations secured by Other First Liens.

 

“Other First Liens” shall mean Liens on the Collateral that are pari passu with the Liens thereon securing the Term B Loans (and other Loan Obligations that are pari passu with the Term B Loans) pursuant to a Permitted Pari Passu Intercreditor Agreement.

 

“Other Revolving Facility Commitments” shall mean Incremental Revolving Facility Commitments to make Other Revolving Facility Loans.

 

“Other Revolving Facility Loans” shall have the meaning assigned to such term in Section 2.20(a).

 

“Other Taxes” shall mean any and all present or future stamp, documentary or similar taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, from the receipt or perfection of a security interest under, or otherwise with respect to, the Loan Documents, and any and all interest and penalties related thereto.

 

“Other Term Loans” shall have the meaning assigned to such term in Section 2.20(a) (including in the form of Extended Term Loans or Refinancing Term Loans, as applicable).

 

“Parent” shall have the meaning assigned to such term in the recitals hereto, together with its successors and assigns.

 

“Parent Entity” shall mean any direct or indirect parent of the Borrower.

 

“Pari First Lien Intercreditor Agreement” shall mean the Pari First Lien Intercreditor Agreement, dated as of the Closing Date, by and among Royal Bank of Canada, as Collateral Agent (as defined therein), Royal Bank of Canada, as Administrative Agent (as defined therein), Royal Bank of Canada, as Initial Other Authorized Representative (as defined therein), and each additional Authorized Representative (as defined therein) from time to time party thereto, as such document may be amended, restated, supplemented or otherwise modified from time to time.

 

“Pari Term Loans” shall have the meaning assigned to such term in Section 6.02.

 

“Pari Yield Differential” shall have the meaning assigned to such term in Section 6.02.

 

“Participant” shall have the meaning assigned to such term in Section 9.04(d)(i).

 

“Participant Register” shall have the meaning assigned to such term in Section 9.04(d)(ii).

 

“Participating Member State” shall mean each state so described in any EMU Legislation.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

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“Perfection Certificate” shall mean the Perfection Certificate with respect to the Loan Parties, in a form reasonably satisfactory to the Administrative Agent, as the same may be supplemented from time to time to the extent required by Section 5.04(f).

 

“Permitted Business Acquisition” shall mean any acquisition of all or substantially all the assets of, or all or substantially all the Equity Interests (other than directors’ qualifying shares) not previously held by the Borrower and its Subsidiaries in, or merger, consolidation or amalgamation with, a person or division, line of business or individual facility of a person (or any subsequent investment made in a person or division, line of business or individual facility previously acquired in a Permitted Business Acquisition), if immediately after giving effect thereto: (i) no Event of Default under clause (b), (c), (h) or (i) of Section 7.01 shall have occurred and be continuing or would result therefrom, provided, however, that with respect to a proposed acquisition pursuant to an executed acquisition agreement, at the option of the Borrower, the determination of whether such an Event of Default shall exist shall be made solely at the time of the execution of the acquisition agreement related to such Permitted Business Acquisition; (ii) all transactions related thereto shall be consummated in all material respects in accordance with applicable laws; (iii) [reserved]; (iv) any acquired or newly formed Subsidiary shall not be liable for any Indebtedness except for Indebtedness permitted by Section 6.01; (v) to the extent required by Section 5.11, any person acquired in such acquisition, if acquired by the Borrower or a Domestic Subsidiary, shall be merged into the Borrower or a Subsidiary Loan Party or become upon consummation of such acquisition a Subsidiary Loan Party; and (vi) the aggregate cash consideration in respect of such acquisitions and investments by the Borrower or a Subsidiary Loan Party in assets that are not owned by the Borrower or Subsidiary Loan Parties or in Equity Interests in persons that are not Subsidiary Loan Parties or do not become Subsidiary Loan Parties, in each case upon consummation of such acquisition, shall not exceed, the greater of (x) $40,000,000 and (y) 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period (excluding for purposes of the calculation in this clause (vi), (A) any such assets or Equity Interests that are no longer owned by the Borrower or any of its Subsidiaries and (B) acquisitions and investments made at a time when, immediately after giving effect thereto, the Net Total Leverage Ratio on a Pro Forma Basis would not exceed 2.72 to 1.00, which acquisitions and investments shall be permitted under this clause (vi) without regard to such calculation).

 

“Permitted Cure Security” shall mean Equity Interests of the Borrower, Holdings or any Parent Entity issued pursuant to the Cure Right other than Disqualified Stock.

 

“Permitted Holder Group” shall have the meaning assigned to such term in the definition of “Permitted Holders.”

 

“Permitted Holders” shall mean (i) the Co-Investors (and each person to whom any Co-Investor transfers Equity Interests of the Borrower, Holdings or any Parent Entity in connection with the primary equity syndication following the Closing Date), (ii) any person that has no material assets other than the Equity Interests of the Borrower, Holdings or any Parent Entity and that, directly or indirectly, holds or acquires beneficial ownership of 100% on a fully diluted basis of the voting Equity Interests of the Borrower, and of which no other person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Closing Date), other than any of the other Permitted Holders specified in clause (i) and this clause (ii), beneficially owns more than 50% on a fully diluted basis of the voting Equity Interests thereof and (iii) any “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Closing Date) the members of which include any of the other Permitted Holders specified in clause (i) and clause (ii) and that, directly or indirectly, hold or acquire beneficial ownership of the voting Equity Interests of the Borrower (a “Permitted Holder Group”), so long as (1) each member of the Permitted Holder Group has voting rights proportional to the percentage of ownership interests held or acquired by such member and (2) no person or other “group” (other than

 

46

 

the other Permitted Holders specified in clause (i) and clause (ii)) beneficially owns more than 50% on a fully diluted basis of the voting Equity Interests held by the Permitted Holder Group.

 

“Permitted Investments” shall mean:

 

(a)                                 direct obligations of the United States of America or any member of the European Union or any agency thereof or obligations guaranteed by the United States of America or any member of the European Union or any agency thereof, in each case with maturities not exceeding two years from the date of acquisition thereof;

 

(b)                                 time deposit accounts, certificates of deposit, money market deposits, banker’s acceptances and other bank deposits maturing within 180 days of the date of acquisition thereof issued by a bank or trust company that is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America having capital, surplus and undivided profits in excess of $250,000,000 and whose long-term debt, or whose parent holding company’s long-term debt, is rated A (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));

 

(c)                                  repurchase obligations with a term of not more than 180 days for underlying securities of the types described in clause (a) above entered into with a bank meeting the qualifications described in clause (b) above;

 

(d)                                 commercial paper, maturing not more than one year after the date of acquisition, issued by a corporation (other than an Affiliate of the Borrower) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of P 1 (or higher) according to Moody’s or A 1 (or higher) according to S&P (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));

 

(e)                                  securities with maturities of two years or less from the date of acquisition, issued or fully guaranteed by any State, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least A by S&P or A by Moody’s (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));

 

(f)                                   shares of mutual funds whose investment guidelines restrict 95% of such funds’ investments to those satisfying the provisions of clauses (a) through (e) above;

 

(g)                                  money market funds that (i) comply with the criteria set forth in Rule 2a 7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000;

 

(h)                                 time deposit accounts, certificates of deposit, money market deposits, banker’s acceptances and other bank deposits in an aggregate face amount not in excess of 0.5% of the total assets of the Borrower and the Subsidiaries, on a consolidated basis, as of the end of the Borrower’s most recently completed fiscal year; and

 

(i)                                     instruments equivalent to those referred to in clauses (a) through (h) above denominated in any foreign currency comparable in credit quality and tenor to those referred to

 

47

 

above and commonly used by corporations for cash management purposes in any jurisdiction outside the United States of America to the extent reasonably required in connection with any business conducted by any Subsidiary organized in such jurisdiction.

 

“Permitted Junior Intercreditor Agreement” shall mean, with respect to any Liens on Collateral that are intended to be junior to any Liens securing the Term B Loans (and other Loan Obligations that are pari passu with the Term B Loans) (including, for the avoidance of doubt, junior Liens pursuant to Section 2.20(b)(ii) or (v)), either (as the Borrower shall elect) (x) the First Lien/Second Lien Intercreditor Agreement if such Liens secure “Second Lien Obligations” (as defined therein), (y) another intercreditor agreement not materially less favorable to the Lenders vis-à-vis such junior Liens than the First Lien/Second Lien Intercreditor Agreement (as determined by the Borrower in good faith) or (z) another intercreditor agreement the terms of which are consistent with market terms governing security arrangements for the sharing of liens on a junior basis at the time such intercreditor agreement is proposed to be established in light of the type of Indebtedness to be secured by such liens, as determined by the Administrative Agent and the Borrower in the exercise of reasonable judgment.

 

“Permitted Liens” shall have the meaning assigned to such term in Section 6.02.

 

“Permitted Loan Purchase” shall have the meaning assigned to such term in Section 9.04(i).

 

“Permitted Loan Purchase Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender as an Assignor and Holdings, the Borrower or any of the Subsidiaries as an Assignee, as accepted by the Administrative Agent (if required by Section 9.04) in the form of Exhibit G to the Original Credit Agreement or such other form as shall be approved by the Administrative Agent and the Borrower (such approval not to be unreasonably withheld or delayed).

 

“Permitted Pari Passu Intercreditor Agreement” shall mean, with respect to any Liens on Collateral that are intended to be pari passu with the Liens securing the Term B Loans (and other Loan Obligations that are pari passu with the Term B Loans), either (as the Borrower shall elect) (x) the Pari First Lien Intercreditor Agreement, (y) another intercreditor agreement not materially less favorable to the Lenders vis-à-vis such pari passu Liens than the Pari First Lien Intercreditor Agreement (as determined by the Borrower in good faith) or (z) another intercreditor agreement the terms of which are consistent with market terms governing security arrangements for the sharing of liens on a pari passu basis at the time such intercreditor agreement is proposed to be established in light of the type of Indebtedness to be secured by such liens, as determined by the Administrative Agent and the Borrower in the exercise of reasonable judgment.

 

“Permitted Refinancing Indebtedness” shall mean any Indebtedness issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund (collectively, to “Refinance”), the Indebtedness being Refinanced (or previous refinancings thereof constituting Permitted Refinancing Indebtedness); provided that (a) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so Refinanced (plus unpaid accrued interest and premium (including tender premiums) thereon and underwriting discounts, defeasance costs, fees, commissions, expenses, plus an amount equal to any existing commitment unutilized thereunder and letters of credit undrawn thereunder), (b) except with respect to Section 6.01(i), (i) the final maturity date of such Permitted Refinancing Indebtedness is on or after the earlier of (x) the final maturity date of the Indebtedness being Refinanced and (y)  the Latest Maturity Date in effect at the time of incurrence thereof and (ii) the Weighted Average Life to Maturity of such Permitted Refinancing Indebtedness is greater than or equal to the lesser of (i) the Weighted Average Life to Maturity of the Indebtedness being

 

48

 

Refinanced and (ii) the Weighted Average Life to Maturity of the Class of Term Loans then outstanding with the greatest remaining Weighted Average Life to Maturity, (c) if the Indebtedness being Refinanced is subordinated in right of payment to the Loan Obligations under this Agreement, such Permitted Refinancing Indebtedness shall be subordinated in right of payment to such Loan Obligations on terms in the aggregate not materially less favorable to the Lenders as those contained in the documentation governing the Indebtedness being Refinanced, (d) no Permitted Refinancing Indebtedness shall have obligors that are not (or would not have been) obligated with respect to the Indebtedness being so Refinanced (except that a Loan Party may be added as an additional obligor) and (e) if the Indebtedness being Refinanced is secured by Liens on any Collateral (whether senior to, equally and ratably with, or junior to the Liens on such Collateral securing the Loan Obligations or otherwise), such Permitted Refinancing Indebtedness may be secured by such Collateral (including any Collateral pursuant to after-acquired property clauses to the extent any such Collateral secured (or would have secured) the Indebtedness being Refinanced) on terms in the aggregate that are substantially similar to, or not materially less favorable to the Secured Parties than, the Indebtedness being refinanced or on terms otherwise permitted by Section 6.02.

 

“Permitted Securitization Documents” shall mean all documents and agreements evidencing, relating to or otherwise governing a Permitted Securitization Financing.

 

“Permitted Securitization Financing” shall mean one or more transactions pursuant to which (i) Securitization Assets or interests therein are sold to or transferred or financed by one or more Special Purpose Securitization Subsidiaries, and (ii) such Special Purpose Securitization Subsidiaries finance (or refinance) their acquisition of such Securitization Assets or interests therein, or the financing thereof, by selling or borrowing against Securitization Assets (including conduit and warehouse financings) and any Swap Agreements entered into in connection with such Securitization Assets; provided that recourse to the Borrower or any Subsidiary (other than the Special Purpose Securitization Subsidiaries) in connection with such transactions shall be limited to the extent customary (as determined by the Borrower in good faith) for similar transactions in the applicable jurisdictions (including, to the extent applicable, in a manner consistent with the delivery of a “true sale”/”absolute transfer” opinion with respect to any transfer by the Borrower or any Subsidiary (other than a Special Purpose Securitization Subsidiary)).

 

“person” shall mean any natural person, corporation, business trust, joint venture, association, company, partnership, limited liability company or government, individual or family trusts, or any agency or political subdivision thereof.

 

“Plan” shall mean any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code and in respect of which Holdings, the Borrower, any Subsidiary or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

 

“Platform” shall have the meaning assigned to such term in Section 9.19(b).

 

“Pledged Collateral” shall have the meaning assigned to such term in the Collateral Agreement.

 

“Pre-Opening Expenses” shall mean, with respect to any fiscal period, the amount of expenses (other than interest expense) incurred with respect to facilities which are classified as “pre-opening expenses” (or any similar or equivalent caption) on the applicable financial statements of the Borrower and the Subsidiaries for such period, prepared in accordance with GAAP.

 

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“Prepayment or Reduction Notice” means a notice by the Borrower to prepay or reduce Loans, which, when in writing, shall be substantially in the form of Exhibit F to the Original Credit Agreement (or such other form as the Administrative Agent may approve).

 

“Pricing Grid” shall mean, with respect to the Revolving Facility Loans and Revolving Facility Commitments, the tables set forth below:

 

Pricing Grid for Revolving Facility Loans

 

	
Net First Lien Leverage Ratio
    	
 
    	
Applicable Margin for
   Eurocurrency Loans
    	
 
    	
Applicable
   Margin for ABR
   Loans
    	
 
    
	
Greater than   3.25 to 1.00
    	
 
    	
7.00
    	
%
    	
6.00
    	
%
    
	
Less than or   equal to 3.25 to 1.00 but greater than 2.75 to 1.00
    	
 
    	
6.75
    	
%
    	
5.75
    	
%
    
	
Less than or   equal to 2.75 to 1.00
    	
 
    	
6.50
    	
%
    	
5.50
    	
%
    

 

Pricing Grid for Revolving Facility Commitments

 

	
Net First Lien Leverage Ratio
    	
 
    	
Applicable Commitment Fee
    	
 
    
	
Greater than   3.25 to 1.00
    	
 
    	
0.50
    	
%
    
	
Less than or   equal to 3.25 to 1.00
    	
 
    	
0.375
    	
%
    

 

For the purposes of the Pricing Grid, changes in the Applicable Margin and the Applicable Commitment Fee resulting from changes in the Net First Lien Leverage Ratio shall become effective on the date (the “Adjustment Date”) that is three Business Days after the date on which the relevant financial statements are delivered to the Administrative Agent pursuant to Section 5.04 for each fiscal quarter commencing with the first full fiscal quarter of the Borrower ended after the Closing Date, and shall remain in effect until the next Adjustment Date.  Following the first Adjustment Date commencing with the first full fiscal quarter of the Borrower ended after the Closing Date, the Applicable Margin and the Applicable Commitment Fee shall be determined by reference to the Net First Lien Leverage Ratio as of the last day of the most recently ended fiscal quarter of the Borrower preceding the applicable Adjustment Date as reflected in the applicable compliance certificate delivered to the Administrative Agent pursuant to Section 5.04(c).  If any financial statements referred to above are not delivered within the time periods specified in Section 5.04, then, at the option of the Administrative Agent or the Required Lenders, until the date that is three Business Days after the date on which such financial statements are delivered, the pricing level that is set forth in clause (ii) of the definition of the term “Applicable Margin” and set forth in clause (i) of the definition of the term “Applicable Commitment Fee”, as applicable, shall apply as of the first Business Day after the date on which such financial statements were to have been delivered but were not delivered.  Each determination of the Net First Lien Leverage Ratio pursuant to the Pricing Grid shall be made in a manner consistent with the determination thereof pursuant to Section 6.11.

 

Notwithstanding anything to the contrary contained above in this definition or elsewhere in this Agreement, if it is subsequently determined that the Net First Lien Leverage Ratio set forth in any compliance certificate delivered to the Administrative Agent pursuant to Section 5.04(c) is inaccurate as a result of any fraud, intentional misrepresentation or willful misconduct of the Borrower or any officer

 

50

 

thereof and the result is that the Lenders received interest or fees for any period based on an Applicable Margin or an Applicable Commitment Fee that is less than that which would have been applicable had the Net First Lien Leverage Ratio been accurately determined, then, for all purposes of this Agreement, the “Applicable Margin” or the “Applicable Commitment Fee” for any day occurring within the period covered by such compliance certificate shall retroactively be deemed to be the relevant percentage as based upon the accurately determined Net First Lien Leverage Ratio for such period, and any shortfall in the interest or fees theretofore paid by the Borrower for the relevant period pursuant to this Agreement as a result of the miscalculation of the Net First Lien Leverage Ratio shall be deemed to be (and shall be) due and payable under the relevant provisions of this Agreement, as applicable, at the time the interest or fees for such period were required to be paid pursuant to said Section (and shall remain due and payable until paid in full, together with all amounts owing under Section 2.13, in accordance with the terms of this Agreement), but shall be paid for the ratable account of the Lenders at the time that such determination is made.

 

“primary obligor” shall have the meaning assigned to such term in the definition of the term “Guarantee.”

 

“Prime Rate” shall mean the rate of interest per annum determined from time to time by the Administrative Agent as its prime rate in effect at its principal office in New York City and notified to the Borrower.

 

“Pro Forma Closing Balance Sheet” shall have the meaning assigned to such term in Section 3.05(b).

 

“Pro Forma Basis” shall mean, as to any person, for any events as described below that occur subsequent to the commencement of a period for which the financial effect of such events is being calculated, and giving effect to the events for which such calculation is being made, such calculation as will give pro forma effect to such events as if such events occurred on the first day of the four consecutive fiscal quarter period ended on or before the occurrence of such event (the “Reference Period”):  (i) pro forma effect shall be given to any Disposition, any acquisition, Investment, capital expenditure, construction, repair, replacement, improvement, development, disposition, merger, amalgamation, consolidation (including the Transactions and the Repricing Date Transactions) (or any similar transaction or transactions not otherwise permitted under Section 6.04 or 6.05 that require a waiver or consent of the Required Lenders and such waiver or consent has been obtained), any dividend, distribution or other similar payment, any designation of any Subsidiary as an Unrestricted Subsidiary and any Subsidiary Redesignation, New Project, and any restructurings of the business of the Borrower or any of its Subsidiaries that the Borrower or any of the Subsidiaries has determined to make and/or made and in the good faith determination of a Responsible Officer of the Borrower are expected to have a continuing impact and are factually supportable, which would include cost savings resulting from head count reduction, closure of facilities and similar operational and other cost savings, which adjustments the Borrower determines are reasonable as set forth in a certificate of a Financial Officer of the Borrower (the foregoing, together with any transactions related thereto or in connection therewith, the “relevant transactions”), in each case that occurred during the Reference Period (or, in the case of determinations made pursuant to Section 2.20 or Article VI (other than Section 6.11), occurring during the Reference Period or thereafter and through and including the date upon which the relevant transaction is consummated), (ii) in making any determination on a Pro Forma Basis, (x) all Indebtedness (including Indebtedness issued, incurred or assumed as a result of, or to finance, any relevant transactions and for which the financial effect is being calculated, whether incurred under this Agreement or otherwise, but excluding normal fluctuations in revolving Indebtedness incurred for working capital purposes and amounts outstanding under any Permitted Securitization Financing, in each case not to finance any acquisition) issued, incurred, assumed or permanently repaid during the Reference Period (or, in the case

 

51

 

of determinations made pursuant to Section 2.20 or Article VI (other than Section 6.11), occurring during the Reference Period or thereafter and through and including the date upon which the relevant transaction is consummated) shall be deemed to have been issued, incurred, assumed or permanently repaid at the beginning of such period, (y) Interest Expense of such person attributable to interest on any Indebtedness, for which pro forma effect is being given as provided in the preceding clause (x), bearing floating interest rates shall be computed on a pro forma basis as if the rates that would have been in effect during the period for which pro forma effect is being given had been actually in effect during such periods, and (z) in giving effect to clause (i) above with respect to each New Project which commences operations and records not less than one full fiscal quarter’s operations during the Reference Period, the operating results of such New Project shall be annualized on a straight line basis during such period, taking into account any seasonality adjustments determined by the Borrower in good faith, and (iii) (A) any Subsidiary Redesignation then being designated, effect shall be given to such Subsidiary Redesignation and all other Subsidiary Redesignations after the first day of the relevant Reference Period and on or prior to the date of the respective Subsidiary Redesignation then being designated, collectively, and (B) any designation of a Subsidiary as an Unrestricted Subsidiary, effect shall be given to such designation and all other designations of Subsidiaries as Unrestricted Subsidiaries after the first day of the relevant Reference Period and on or prior to the date of the then applicable designation of a Subsidiary as an Unrestricted Subsidiary, collectively.

 

In the event that EBITDA or any financial ratio is being calculated for purposes of determining whether Indebtedness or any Lien relating thereto may be incurred or whether any Investment may be made, the Borrower may elect pursuant to a certificate of a Responsible Officer delivered to the Administrative Agent to treat all or any portion of the commitment relating thereto as being incurred at the time of such commitment, in which case any subsequent incurrence of Indebtedness under such commitment shall not be deemed, for purposes of this calculation, to be an incurrence at such subsequent time.

 

Pro forma calculations made pursuant to the definition of the term “Pro Forma Basis” shall be determined in good faith by a Responsible Officer of the Borrower and may include adjustments to reflect (1) operating expense reductions and other operating improvements, synergies or cost savings reasonably expected to result from any relevant pro forma event (including, to the extent applicable, the Transactions) and (2) all adjustments of the type used in connection with the calculation of “Further Adjusted EBITDA” as set forth in the “Summary Unaudited Pro Forma Financial and Other Information of Exela” portion of the “Summary” section of the Senior Secured Notes Offering Memorandum to the extent such adjustments, without duplication, continue to be applicable to such Reference Period; provided that for all purposes of determining EBITDA hereunder (i) adjustments for operating expense reductions and other operating improvements, synergies or cost savings shall not be more than 20% of EBITDA for the most recently ended four fiscal quarter period (calculated prior to giving effect to such capped adjustments (but, for the avoidance of doubt, after giving effect to other uncapped pro forma adjustments)) and (ii) actions resulting in operating expense reductions and other operating improvements, synergies or cost savings are, in each case, required to be taken or commenced or expected to be taken or commenced (in the good faith determination of the Borrower) within 24 months after the date any such transaction is consummated; provided that the limitations set forth in clauses (i) and (ii) shall not apply to any operating expense reductions, other operating improvements or synergies and adjustments resulting from the Transactions or otherwise pursuant to clause (2) above, and information and calculations supporting them in reasonable detail.

 

For purposes of this definition, any amount in a currency other than Dollars will be converted to Dollars based on the average exchange rate for such currency for the most recent twelve month period immediately prior to the date of determination in a manner consistent with that used in calculating EBITDA for the applicable period.

 

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“Pro Forma Compliance” shall mean, at any date of determination, that the Borrower and its Subsidiaries shall be in compliance, on a Pro Forma Basis after giving effect on a Pro Forma Basis to the relevant transactions (including the assumption, the issuance, incurrence and permanent repayment of Indebtedness), with the Financial Covenant recomputed as at the last day of the most recently ended fiscal quarter of the Borrower and its Subsidiaries for which the financial statements and certificates required pursuant to Section 5.04 have been delivered.

 

“Pro Rata Extension Offers” shall have the meaning assigned to such term in Section 2.20(e).

 

“Pro Rata Share” shall have the meaning assigned to such term in Section 9.09(f).

 

“Projections” shall mean the projections of the Borrower and the Subsidiaries included in the Information Memorandum and any other projections and any forward-looking statements (including statements with respect to booked business) of such entities furnished to the Lenders, the Joint Lead Arrangers or the Administrative Agent by or on behalf of Holdings, the Borrower or any of the Subsidiaries prior to the Closing Date.

 

“Public Lender” shall have the meaning assigned to such term in Section 9.19(b).

 

“Qualified Equity Interests” shall mean any Equity Interests other than Disqualified Stock.

 

“Rate” shall have the meaning assigned to such term in the definition of the term “Type.”

 

“Real Property” shall mean, collectively, all right, title and interest (including any leasehold estate) in and to any and all parcels of or interests in real property owned in fee or leased by any Loan Party, together with, in each case, all easements, hereditaments and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, incidental to the ownership, lease or operation thereof.

 

“Receivables Assets” shall mean accounts receivable (including any bills of exchange) and related assets and property from time to time originated, acquired or otherwise owned by the Borrower or any Subsidiary.

 

“Reference Period” shall have the meaning assigned to such term in the definition of the term “Pro Forma Basis.”

 

“Refinance” shall have the meaning assigned to such term in the definition of the term “Permitted Refinancing Indebtedness,” and “Refinancing” and “Refinanced” shall have a meaning correlative thereto.

 

“Refinancing Effective Date” shall have the meaning assigned to such term in Section 2.20(j).

 

“Refinancing Notes” shall mean any secured or unsecured notes or loans issued by the Borrower or any Subsidiary Loan Party (whether under an indenture, a credit agreement or otherwise) and the Indebtedness represented thereby; provided that (a) (i) 100% of the Net Proceeds of such Refinancing Notes that are secured on a pari passu basis with the Term B Loans are used to permanently reduce Loans and/or replace Commitments substantially simultaneously with the issuance thereof or (ii) 90% of the Net Proceeds of any other Refinancing Notes are used to permanently reduce Loans and/or replace

 

53

 

Commitments substantially simultaneously with the issuance thereof; (b) the principal amount (or accreted value, if applicable) of such Refinancing Notes does not exceed the principal amount (or accreted value, if applicable) of the aggregate portion of the Loans so reduced and/or Commitments so replaced (plus unpaid accrued interest and premium (including tender premiums) thereon and underwriting discounts, defeasance costs, fees, commissions and expenses); (c) the final maturity date of such Refinancing Notes is on or after the Term Facility Maturity Date or the Revolving Facility Maturity Date, as applicable, of the Term Loans so reduced or the Revolving Facility Commitments so replaced; (d) the Weighted Average Life to Maturity of such Refinancing Notes is greater than or equal to the Weighted Average Life to Maturity of the Term Loans so reduced or the Revolving Facility Commitments so replaced, as applicable; (e) in the case of Refinancing Notes in the form of notes issued under an indenture, the terms thereof do not provide for any scheduled repayment, mandatory redemption or sinking fund obligations prior to the Term Facility Maturity Date of the Term Loans so reduced or the Revolving Facility Maturity Date of the Revolving Facility Commitments so replaced, as applicable (other than customary offers to repurchase or mandatory prepayment provisions upon a change of control, asset sale or event of loss and customary acceleration rights after an event of default); (f) the other terms of such Refinancing Notes (other than interest rates, fees, floors, funding discounts and redemption or prepayment premiums and other pricing terms), taken as a whole, are substantially similar to, or not materially less favorable to the Borrower and its Subsidiaries than the terms, taken as a whole, applicable to the Term B Loans (except for covenants or other provisions applicable only to periods after the Latest Maturity Date in effect at the time such Refinancing Notes are issued or are otherwise reasonably acceptable to the Administrative Agent), as determined by the Borrower in good faith (or, if more restrictive, the Loan Documents are amended to contain such more restrictive terms to the extent required to satisfy the foregoing standard); (g) there shall be no obligor in respect of such Refinancing Notes that is not a Loan Party; and (h) Refinancing Notes that are secured by Collateral shall be subject to the provisions of a Permitted Pari Passu Intercreditor Agreement or a Permitted Junior Intercreditor Agreement, as applicable.

 

“Refinancing Term Loans” shall have the meaning assigned to such term in Section 2.20(j).

 

“Register” shall have the meaning assigned to such term in Section 9.04(b)(iv).

 

“Regulation T” shall mean Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation U” shall mean Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation X” shall mean Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Related Fund” shall mean, with respect to any Lender that is a fund that invests in bank or commercial loans and similar extensions of credit, any other fund that invests in bank or commercial loans and similar extensions of credit and is advised or managed by (a) such Lender, (b) an Affiliate of such Lender or (c) an entity (or an Affiliate of such entity) that administers, advises or manages such Lender.

 

“Related Parties” shall mean, with respect to any specified person, such person’s Controlled or Controlling Affiliates and the partners, directors, officers, employees, agents, trustees, advisors, controlling persons and members of such person and of such person’s Controlled or Controlling Affiliates.

 

54

 

“Related Sections” shall have the meaning assigned to such term in Section 6.04.

 

“Release” shall mean any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, emanating or migrating in, into, onto or through the environment, and “Released” shall have a meaning correlative thereto.

 

“Reorganization” shall mean, collectively, (i) the formation of the Borrower by Parent and contribution of 100% of the equity interests of SourceHOV Merger Sub and Novitex Merger Sub to the Borrower and (ii) the formation of Holdings by Parent and the contribution of 100% of the equity interests of the Borrower to Holdings.

 

“Replacement Revolving Facilities” shall have the meaning assigned to such term in Section 2.20(l).

 

“Replacement Revolving Facility Commitments” shall have the meaning assigned to such term in Section 2.20(l).

 

“Replacement Revolving Facility Effective Date” shall have the meaning assigned to such term in Section 2.20(l).

 

“Replacement Revolving Loans” shall have the meaning assigned to such term in Section 2.20(l).

 

“Reportable Event” shall mean any reportable event as defined in Section 4043(c) of ERISA or the regulations issued thereunder, other than those events as to which the 30-day notice period referred to in Section 4043(c) of ERISA has been waived, with respect to a Plan (other than a Plan maintained by an ERISA Affiliate that is considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Section 414 of the Code).

 

“Repricing Effective Date” shall have the meaning assigned to such term in the recitals hereto.

 

“Repricing Date Transactions” shall mean (a) the execution, delivery and performance of the First Amendment and the borrowings thereunder, (b) the repayment in full of the Existing Term Loans (as defined in the First Amendment) and (c) the payment of all fees and expenses to be paid and owing in connection with any of the foregoing.

 

“Required Amount of Loans” shall have the meaning assigned to such term in the definition of the term “Required Lenders.”

 

“Required Lenders” shall mean, at any time, Lenders having (a) Loans outstanding, (b) L/C Exposure and (c) Available Unused Commitments that, taken together, represent more than 50% of the sum of (x) all Loans outstanding, (y) L/C Exposure and (z) the total Available Unused Commitments at such time; provided that (i) the Loans, L/C Exposure and Available Unused Commitment of any Defaulting Lender shall be disregarded in determining Required Lenders at any time and (ii) the portion of any Term Loans held by Debt Fund Affiliate Lenders in the aggregate in excess of 49.9% of the Required Amount of Loans shall be disregarded in determining Required Lenders at any time.  For purposes of the foregoing, “Required Amount of Loans” shall mean, at any time, the amount of Loans required to be held by Lenders in order for such Lenders to constitute “Required Lenders” (without giving effect to the foregoing clause (ii)).

 

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“Required Percentage” shall mean, with respect to an Excess Cash Flow Period (or Excess Cash Flow Interim Period, as applicable), 75%; provided that, if the Net First Lien Leverage Ratio calculated as of the end of any Excess Cash Flow Period (or Excess Cash Flow Interim Period, as applicable) is (a) less than or equal to 3.25 to 1.00 but greater than 2.75 to 1.00, the Required Percentage shall be 50%, (b) less than or equal to 2.75 to 1.00 but greater than 2.50 to 1.00, the Required Percentage shall be 25% and (c) less than or equal to 2.50 to 1.00, the Required Percentage shall be 0%.

 

“Required Prepayment Lenders” shall mean, at any time, the holders of more than 50% of the aggregate unpaid principal amount of the Term Loans at such time (subject to the last paragraph of Section 9.09(b)).

 

“Required Revolving Facility Lenders” shall mean, at any time, Revolving Facility Lenders having (a) Revolving Facility Loans outstanding, (b) L/C Exposures and (d) Available Unused Commitments that, taken together, represent more than 50% of the sum of (x) all Revolving Facility Loans outstanding, (y) all L/C Exposures and (z) the total Available Unused Commitments at such time; provided that the Revolving Facility Loans, L/C Exposures and Available Unused Commitment of any Defaulting Lender shall be disregarded in determining Required Revolving Facility Lenders at any time.

 

“Requirement of Law” shall mean, as to any person, any law, treaty, rule, regulation, statute, order, ordinance, decree, judgment, consent decree, writ, injunction, settlement agreement or governmental requirement enacted, promulgated or imposed by any Governmental Authority, in each case applicable to or binding upon such person or any of its property or assets or to which such person or any of its property or assets is subject.

 

“Responsible Officer” of any person shall mean any executive officer or Financial Officer of such person and any other officer or similar official thereof responsible for the administration of the obligations of such person in respect of this Agreement or any other duly authorized employee or signatory of such person.

 

“Retained Percentage” shall mean, with respect to any Excess Cash Flow Period (or Excess Cash Flow Interim Period), (a) 100% minus (b) the Required Percentage with respect to such Excess Cash Flow Period (or Excess Cash Flow Interim Period).

 

“Revaluation Date” shall mean (a) with respect to any Alternate Currency Letter of Credit, each of the following: (i) each date of issuance, extension or renewal of an Alternate Currency Letter of Credit, (ii) each date of an amendment of any Alternate Currency Letter of Credit having the effect of increasing the amount thereof, (iii) each date of any payment by the applicable Issuing Bank under any Alternate Currency Letter of Credit, and (iv) such additional dates as the Administrative Agent or the applicable Issuing Bank shall determine or the Required Lenders shall require and (b) with respect to any Alternate Currency Loans, each of the following: (i) each date of a Borrowing of Eurocurrency Revolving Loans denominated in an Alternate Currency, (ii) each date of a continuation of a Eurocurrency Revolving Loan denominated in an Alternate Currency pursuant to Section 2.07 and (iii) such additional dates as the Administrative Agent shall determine or the Majority Lenders under the Revolving Facility shall require.

 

“Revolving Availability Period” shall mean, with respect to any Class of Revolving Facility Commitments, the period from and including the Closing Date (or, if later, the effective date for such Class of Revolving Facility Commitments) to but excluding the earlier of the Revolving Facility Maturity Date for such Class and the date of termination of the Revolving Facility Commitments of such Class.

 

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“Revolving Facility” shall mean the Revolving Facility Commitments of any Class and the extensions of credit made hereunder by the Revolving Facility Lenders of such Class and, for purposes of Section 9.09(b), shall refer to all such Revolving Facility Commitments as a single Class.

 

“Revolving Facility Borrowing” shall mean a Borrowing comprised of Revolving Facility Loans of the same Class.

 

“Revolving Facility Commitment” shall mean, with respect to any Revolving Facility Lender, such Lender’s commitment to make Revolving Facility Loans pursuant to Section 2.01(b), expressed as an amount representing the maximum aggregate permitted amount of such Lender’s Revolving Facility Exposure hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.08, (b) reduced or increased from time to time pursuant to assignments by or to such Lender under Section 9.04 and (c) increased (or replaced) as provided under Section 2.20.  The initial amount of each Lender’s Revolving Facility Commitment is set forth on Schedule 2.01 to the Original Credit Agreement, or in the Assignment and Acceptance or Incremental Assumption Agreement pursuant to which such Lender shall have assumed its Revolving Facility Commitment (or Incremental Revolving Facility Commitment), as applicable.  The aggregate amount of the Lenders’ Revolving Facility Commitments as of the Closing Date is $100,000,000.  On the Closing Date, there is only one Class of Revolving Facility Commitments. After the Closing Date, additional Classes of Revolving Facility Commitments may be added or created pursuant to Incremental Assumption Agreements.

 

“Revolving Facility Exposure” shall mean, at any time, with respect to any Class of Revolving Facility Commitments, the sum of the aggregate principal amount of the Revolving Facility Loans of such Class outstanding at such time (calculated, in the case of Alternate Currency Loans, based on the Dollar Equivalent thereof) and the aggregate L/C Exposure applicable to such Class at such time.  The Revolving Facility Exposure of any Lender at any time shall be the product of (x) such Lender’s Applicable Percentage of the applicable Class and (y) the aggregate Revolving Facility Exposure of such Class of all Lenders, collectively, at such time.

 

“Revolving Facility Lender” shall mean a Lender with a Revolving Facility Commitment or with outstanding Revolving Facility Exposure, or an Incremental Revolving Facility Lender.

 

“Revolving Facility Loans” shall mean a Loan made by a Revolving Facility Lender pursuant to Section 2.01(b) and Other Revolving Facility Loans.  Each Revolving Facility Loan shall be a Eurocurrency Loan or an ABR Loan.

 

“Revolving Facility Maturity Date” shall mean, as the context may require, (a) with respect to the Revolving Facility in effect on the Closing Date, July 12, 2022 and (b) with respect to any other Classes of Revolving Facility Commitments, the maturity dates specified therefor in the applicable Incremental Assumption Agreement.

 

“S&P” shall mean Standard & Poor’s Ratings Group, Inc. and its successors and assigns.

 

“Sale and Lease-Back Transaction” shall have the meaning assigned to such term in Section 6.03.

 

“Sanctions” shall have the meaning assigned to such term in Section 3.23(b).

 

“Sanctions Laws” shall have the meaning assigned to such term in Section 3.23(b).

 

“SEC” shall mean the Securities and Exchange Commission or any successor thereto.

 

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“Secured Cash Management Agreement” shall mean any Cash Management Agreement that is entered into by and between any Loan Party and any Cash Management Bank, or any Guarantee by any Loan Party of any Cash Management Agreement entered into by and between any Subsidiary and any Cash Management Bank, in each case to the extent that such Cash Management Agreement or such Guarantee, as applicable, is not otherwise designated in writing by the Borrower and such Cash Management Bank to the Administrative Agent to not be included as a Secured Cash Management Agreement.

 

“Secured Parties” shall mean, collectively, the Administrative Agent, the Collateral Agent, each Lender, each Issuing Bank, each Swap Bank that is party to any Secured Swap Agreement, each Cash Management Bank that is party to any Secured Cash Management Agreement and each sub-agent appointed pursuant to Section 8.05 by the Administrative Agent with respect to matters relating to the Loan Documents or by the Collateral Agent with respect to matters relating to any Security Document.

 

“Secured Swap Agreement” shall mean any Swap Agreement that is entered into by and between any Loan Party or any Subsidiary and any Swap Bank, or any Guarantee by any Loan Party of any Swap Agreement entered into by and between any Subsidiary and any Swap Bank, in each case to the extent that such Swap Agreement or such Guarantee, as applicable, is not otherwise designated in writing by the Borrower and such Swap Bank to the Administrative Agent to not be included as a Secured Swap Agreement.  Notwithstanding the foregoing, for all purposes of the Loan Documents, any Guarantee of, or grant of any Lien to secure, any obligations in respect of a Secured Swap Agreement by a Guarantor shall not include any Excluded Swap Obligations.

 

“Securities Act” shall mean the Securities Act of 1933, as amended.

 

“Securitization Assets” shall mean any of the following assets (or interests therein) from time to time originated, acquired or otherwise owned by the Borrower or any Subsidiary or in which the Borrower or any Subsidiary has any rights or interests, in each case, without regard to where such assets or interests are located: (a) Receivables Assets, (b) franchise fees, royalties and other similar payments made related to the use of trade names and other Intellectual Property, business support, training and other services, (c) revenues related to distribution and merchandising of the products of the Borrower and its Subsidiaries, (d) Intellectual Property rights relating to the generation of any of the types of assets listed in this definition, (e) parcels of or interests in real property, together with all easements, hereditaments and appurtenances thereto, all improvements and appurtenant fixtures and equipment, incidental to the ownership, lease or operation thereof, (f) any Equity Interests of any Special Purpose Securitization Subsidiary or any Subsidiary of a Special Purpose Securitization Subsidiary and any rights under any limited liability company agreement, trust agreement, shareholders agreement, organizational or formation documents or other agreement entered into in furtherance of the organization of such entity, and (g) any other assets and property (or proceeds of such assets or property) to the extent customarily included in securitization transactions of the relevant type in the applicable jurisdictions (as determined by the Borrower in good faith).

 

“Security Documents” shall mean the Mortgages, the Collateral Agreement, the Holdings Guarantee and Pledge Agreement, the IP Security Agreements (as defined in the Collateral Agreement) and each of the other security agreements, mortgages and other instruments and documents executed and delivered pursuant to any of the foregoing or pursuant to Section 5.11, in each case, as may be amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time in accordance with the terms hereof and thereof.

 

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“Senior Secured Notes Offering Memorandum” shall mean the Offering Memorandum dated June 28, 2017 in respect of the Senior Secured Notes.

 

“Senior Secured Note Documents” shall mean the Senior Secured Notes Indenture and the other “Note Documents” under and as defined in the Senior Secured Notes Indenture, as each such document may be amended, restated, supplemented or otherwise modified from time to time.

 

“Senior Secured Notes” shall mean the 10.000% First-Priority Senior Secured Notes of the Borrower due 2023 issued on the Closing Date pursuant to the Senior Secured Notes Indenture.

 

“Senior Secured Notes Indenture” shall mean the indenture governing the Senior Secured Notes, as such document may be amended, restated, supplemented or otherwise modified from time to time.

 

“Similar Business” shall mean any business or activity of the Borrower or any of its Subsidiaries currently conducted or proposed as of the Closing Date, or any business or activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof, or is complementary, incidental, ancillary or related thereto.

 

“SourceHOV” shall have the meaning assigned to such term in the recitals hereto.

 

“SourceHOV Consulting Agreement” means, collectively, (i) the Consulting Agreement, dated April 30, 2013, between SourceHOV Holdings, Inc. and Solaris Investment L.P., (ii) the Consulting Agreement, dated April 30, 2013, between SourceHOV Holdings, Inc. and a designee of HandsOn3, LLC and (iii) the Consulting Agreement, dated July 27, 2015, between TransCentra, Inc. and HandsOn Global Management, LLC.

 

“SourceHOV Merger” shall have the meaning assigned to such term in the recitals hereto.

 

“SourceHOV Merger Sub” shall have the meaning assigned to such term in the recitals hereto.

 

“Special Flood Hazard Area” shall have the meaning assigned to such term in Section 5.02(c).

 

“Special Purpose Securitization Subsidiary” shall mean (i) a direct or indirect Subsidiary of the Borrower established in connection with a Permitted Securitization Financing for the acquisition of Securitization Assets or interests therein, and which is organized in a manner (as determined by the Borrower in good faith) intended to reduce the likelihood that it would be substantively consolidated with Holdings, the Borrower or any of the Subsidiaries (other than Special Purpose Securitization Subsidiaries) in the event Holdings, the Borrower or any such Subsidiary becomes subject to a proceeding under the U.S. Bankruptcy Code (or other insolvency law) and (ii) any subsidiary of a Special Purpose Securitization Subsidiary.

 

“Spot Rate” shall mean, in relation to the conversion of one currency into another currency, the spot rate of exchange for such conversion as quoted by the Bank of Canada at the close of business on the Banking Day that such conversion is to be made (or, if such conversion is to be made before close of business on such Banking Day, then at approximately close of business on the immediately preceding Banking Day), and, in either case, if no such rate is quoted, the spot rate of

 

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exchange quoted for wholesale transactions by the Agent in Toronto, Ontario on the Banking Day such conversion is to be made in accordance with its normal practice.

 

“Standby Letters of Credit” shall have the meaning assigned to such term in Section 2.05(a).

 

“Statutory Reserves” shall mean the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board and any other banking authority, domestic or foreign, to which the Administrative Agent or any Lender (including any branch, Affiliate or other fronting office making or holding a Loan) is subject for Eurocurrency Liabilities (as defined in Regulation D of the Board).  Eurocurrency Loans shall be deemed to constitute Eurocurrency Liabilities (as defined in Regulation D of the Board) and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D. Statutory Reserves shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

 

“subsidiary” shall mean, with respect to any person (herein referred to as the “parent”), any corporation, partnership, association or other business entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or more than 50% of the general partnership interests are, at the time any determination is being made, directly or indirectly, owned, Controlled or held, or (b) that is, at the time any determination is made, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

 

“Subsidiary” shall mean, unless the context otherwise requires, a subsidiary of the Borrower.  Notwithstanding the foregoing (and except for purposes of the definition of “Unrestricted Subsidiary” contained herein) an Unrestricted Subsidiary shall be deemed not to be a Subsidiary of the Borrower or any of its Subsidiaries for purposes of this Agreement.

 

“Subsidiary Guarantee Agreement” shall mean the Subsidiary Guarantee Agreement (First Lien) dated as of the Closing Date, as may be amended, amended and restated, supplemented, reaffirmed or otherwise modified from time to time, between each Subsidiary Loan Party and the Collateral Agent.

 

“Subsidiary Loan Party” shall mean (a) each Wholly Owned Domestic Subsidiary of the Borrower that is not an Excluded Subsidiary and (b) any other Subsidiary of the Borrower (that is not an Excluded Subsidiary) that may be designated by the Borrower (by way of delivering to the Collateral Agent a supplement to the Collateral Agreement and a supplement to the Subsidiary Guarantee Agreement, in each case, duly executed by such Subsidiary) in its sole discretion from time to time to be a guarantor in respect of the Obligations and the obligations in respect of the Loan Documents, whereupon such Subsidiary shall be obligated to comply with the other requirements of Section 5.11(d) as if it were newly acquired.

 

“Subsidiary Redesignation” shall have the meaning assigned to such term in the definition of “Unrestricted Subsidiary” contained in this Section 1.01.

 

“Swap Agreement” shall mean any agreement with respect to any swap, forward, future or derivative transaction, or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value, or credit spread transaction, repurchase transaction, reserve repurchase transaction, securities lending transaction, weather index

 

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transaction, spot contracts, fixed price physical delivery contracts, or any similar transaction or any combination of these transactions, in each case of the foregoing, whether or not exchange traded; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of Holdings, the Borrower or any of the Subsidiaries shall be a Swap Agreement.

 

“Swap Bank” shall mean an Agent, a Joint Lead Arranger, a Lender or an Affiliate of any such person and any person that, at the time it entered into a Swap Agreement was an Agent, a Joint Lead Arranger, a Lender or an Affiliate of any such person, in each case, in its capacity as a party to such Swap Agreement, regardless of whether any such person shall thereafter cease to be an Agent, a Joint Lead Arranger, a Lender or an Affiliate of any such person.

 

“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

 

“Taxes” shall mean any and all present or future taxes, duties, levies, imposts, assessments, deductions, withholdings or other similar charges imposed by any Governmental Authority, whether computed on a separate, consolidated, unitary, combined or other basis and any interest, fines, penalties or additions to tax with respect to the foregoing.

 

“Term B Borrowing” shall mean any Borrowing comprised of Term B Loans.

 

“Term B Facility” shall mean the commitments to make the Term Loans under the First Amendment and the Term Loans made hereunder and thereunder.

 

“Term B Facility Maturity Date” shall mean July 12, 2023.

 

“Term B Lender” shall mean a Lender (including an Incremental Term Lender) with an outstanding Term B Loan.

 

“Term B Loan Installment Date” shall have the meaning assigned to such term in Section 2.10(a)(i).

 

“Term B Loans” shall mean (a) prior to the Repricing Effective Date, the Existing Term Loans (as defined in the First Amendment), (b) on and after the Repricing Effective Date, the 2018 Term Loans made by the 2018 Term Lenders to the Borrower on the Repricing Effective Date pursuant to the First Amendment and (c) any Incremental Term Loans in the form of Term B Loans made by the Incremental Term Lenders to the Borrower pursuant to Section 2.01(c). The aggregate principal amount of the Term B Loans outstanding as of the Repricing Effective Date after giving effect to the Repricing Date Transactions is $373,437,500.

 

“Term Borrowing” shall mean any Term B Borrowing or any Incremental Term Borrowing.

 

“Term Facility” shall mean the Term B Facility and/or any or all of the Incremental Term Facilities.

 

“Term Facility Commitment” shall mean the commitment of a Lender to make Term Loans, including Term B Loans and/or Other Term Loans.

 

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“Term Facility Maturity Date” shall mean, as the context may require, (a) with respect to the Term B Facility in effect on the Repricing Effective Date, the Term B Facility Maturity Date and (b) with respect to any other Class of Term Loans, the maturity dates specified therefor in the applicable Incremental Assumption Agreement.

 

“Term Loan Installment Date” shall mean any Term B Loan Installment Date or any Incremental Term Loan Installment Date.

 

“Term Loans” shall mean the Term B Loans and/or the Incremental Term Loans.

 

“Term Yield Differential” shall have the meaning assigned to such term in Section 2.20(b)(vii).

 

“Termination Date” shall mean the date on which (a) all Commitments shall have been terminated, (b) the principal of and interest on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full (other than in respect of contingent indemnification and expense reimbursement claims not then due) and (c) all Letters of Credit (other than those that have been Cash Collateralized) have been cancelled or have expired and all amounts drawn or paid thereunder have been reimbursed in full.

 

“Test Period” shall mean, on any date of determination, the period of four consecutive fiscal quarters of the Borrower then most recently ended (taken as one accounting period) for which financial statements have been (or were required to be) delivered pursuant to Section 5.04(a) or 5.04(b); provided that prior to the first date financial statements have been delivered pursuant to Section 5.04(a) or 5.04(b), the Test Period in effect shall be the four fiscal quarter period ending March 31, 2017.

 

“Third Party Funds” shall mean any segregated accounts or funds, or any portion thereof, received by Borrower or any of its Subsidiaries as agent on behalf of third parties in accordance with a written agreement that imposes a duty upon Borrower or one or more of its Subsidiaries to collect and remit those funds to such third parties.

 

“Trade Letters of Credit” shall have the meaning assigned to such term in Section 2.05(a).

 

“Transaction Documents” shall mean the Business Combination Agreement, the Loan Documents and the Senior Secured Note Documents, in each case as amended from time to time in accordance with the terms hereof and thereof.

 

“Transaction Expenses” shall mean any fees or expenses incurred or paid by the Borrower or any of its Subsidiaries or any of their Affiliates in connection with the Transactions, the Repricing Date Transactions, this Agreement and the other Loan Documents, the Business Combination Agreement, the Senior Secured Note Documents, the transactions contemplated hereby and thereby.

 

“Transactions” shall mean, collectively, the transactions to occur pursuant to the Transaction Documents, including (a) the consummation of the Business Combination; (b) the Equity Contribution, (c) the execution, delivery and performance of the Loan Documents, the creation of Liens pursuant to the Security Documents and the initial borrowings hereunder; (d) the execution, delivery and performance of the Senior Secured Notes Documents, the creation of Liens pursuant to the Senior Secured Notes Documents and the issuance of the Senior Secured Notes thereunder; (e) the repayment in full of, and the termination of all obligations and commitments under, the Existing Credit Agreements; (f) the professional services provided in connection therewith, including legal and auditing services; and

 

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(g) the payment of all fees and expenses in connection therewith to be paid on, prior to or subsequent to the Closing Date and owing in connection with the foregoing.

 

“Type” shall mean, when used in respect of any Loan or Borrowing, the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is determined.  For purposes hereof, the term “Rate” shall include the Adjusted Eurocurrency Rate and ABR.

 

“Unfunded Pension Liability” shall mean, as of the most recent valuation date for the applicable Plan, the excess of (1) the Plan’s actuarial present value (determined on the basis of reasonable assumptions employed by the independent actuary for such Plan for purposes of Section 412 of the Code or Section 302 of ERISA) of its benefit liabilities (as defined in Section 4001(a)(16) of ERISA) over (2) the fair market value of the assets of such Plan.

 

“Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that, at any time, if by reason of mandatory provisions of law any or all of the perfection or priority of the Secured Party’s security interest in any item or portion of the Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect, at such time, in such other jurisdiction for purposes of the provisions relating to such perfection or priority and for purposes of definitions relating to such provisions.

 

“Unreimbursed Amount” shall have the meaning assigned to such term in Section 2.05(c).

 

“Unrestricted Cash” shall mean cash or cash equivalents of the Borrower or any of its Subsidiaries that would not appear as “restricted” on a consolidated balance sheet of the Borrower or any of its Subsidiaries.

 

“Unrestricted Subsidiary” shall mean (1) any Subsidiary of the Borrower identified on Schedule 1.01(d) to the Original Credit Agreement, (2) any other Subsidiary of the Borrower, whether now owned or acquired or created after the Closing Date, that is designated by the Borrower as an Unrestricted Subsidiary hereunder by written notice to the Administrative Agent; provided that the Borrower shall only be permitted to so designate a new Unrestricted Subsidiary after the Closing Date so long as (a) no Default or Event of Default has occurred and is continuing or would result therefrom, (b) immediately after giving effect to such designation, the Borrower shall be in Pro Forma Compliance with the Financial Covenant as of the last day of the then most recently ended Test Period, (c) such Unrestricted Subsidiary shall be capitalized (to the extent capitalized by the Borrower or any of its Subsidiaries) through Investments as permitted by, and in compliance with, Section 6.04, and any prior or concurrent Investments in such Subsidiary by the Borrower or any of its Subsidiaries shall be deemed to have been made under Section 6.04, and (d) without duplication of clause (c), any net assets owned by such Unrestricted Subsidiary at the time of the initial designation thereof shall be treated as Investments pursuant to Section 6.04; and (3) any subsidiary of an Unrestricted Subsidiary.  The Borrower may designate any Unrestricted Subsidiary to be a Subsidiary for purposes of this Agreement (each, a “Subsidiary Redesignation”); provided that (i)  no Default or Event of Default has occurred and is continuing or would result therefrom and (ii) the Borrower shall have delivered to the Administrative Agent an officer’s certificate executed by a Responsible Officer of the Borrower, certifying to the best of such officer’s knowledge, compliance with the requirement of preceding clause (i).

 

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“UCP” shall mean, with respect to any Letter of Credit, the “Uniform Customs and Practice for Documentary Credits” published by the International Chamber of Commerce (or such later version thereof as may be in effect at the time of issuance).

 

“U.S.A. Patriot Act” shall mean the U.S.A. Patriot Act, Title III of Pub.L. 107-56 (signed into law October 26, 2001).

 

“U.S. Dollars” or “$” shall mean lawful money of the United States of America.

 

“U.S. Lending Office” shall mean, as to any Lender, the applicable branch, office or Affiliate of such Lender designated by such Lender to make Loans to the Borrower.

 

“Voting Stock” shall mean, with respect to any person, such person’s Equity Interests having the right to vote for the election of directors of such person under ordinary circumstances.

 

“Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness at any date, the number of years obtained by dividing:  (a) the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by (b) the then outstanding principal amount of such Indebtedness.

 

“Wholly Owned Domestic Subsidiary” shall mean a Wholly Owned Subsidiary that is also a Domestic Subsidiary.

 

“Wholly Owned Subsidiary” of any person shall mean a subsidiary of such person, all of the Equity Interests of which (other than directors’ qualifying shares or nominee or other similar shares required pursuant to applicable law) are owned by such person or another Wholly Owned Subsidiary of such person.  Unless the context otherwise requires, “Wholly Owned Subsidiary” shall mean a Subsidiary of the Borrower that is a Wholly Owned Subsidiary of the Borrower.

 

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

 

“Working Capital” shall mean, with respect to the Borrower and the Subsidiaries on a consolidated basis at any date of determination, Current Assets at such date of determination minus Current Liabilities at such date of determination; provided that, for purposes of calculating Excess Cash Flow, increases or decreases in Working Capital shall be calculated without regard to any changes in Current Assets or Current Liabilities as a result of (a) any reclassification in accordance with GAAP of assets or liabilities, as applicable, between current and noncurrent or (b) the effects of purchase accounting.

 

“Write-Down and Conversion Powers” shall mean, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

“Year To Date Excess Cash Flow” shall mean, at any time of determination with respect to any Excess Cash Flow Period, the Excess Cash Flow for the period commencing on the end of the immediately preceding Excess Cash Flow Period and ending on, as applicable, the last day of the most

 

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recent Excess Cash Flow Interim Period during such Excess Cash Flow Period or the last day of such Excess Cash Flow Period.

 

SECTION 1.02                                           Terms Generally.  The definitions set forth or referred to in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  All references herein to Articles, Sections, Exhibits and Schedules shall be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement unless the context shall otherwise require.  Except as otherwise expressly provided herein, any reference in this Agreement to any Loan Document or other document or agreement shall mean such document as amended, restated, supplemented or otherwise modified from time to time.  Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Closing Date in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.  Notwithstanding any changes in GAAP after the Closing Date, any lease of the Borrower or the Subsidiaries, or of a special purpose or other entity not consolidated with the Borrower and its Subsidiaries at the time of its incurrence of such lease, that would be characterized as an operating lease under GAAP in effect on the Closing Date (whether such lease is entered into before or after the Closing Date) shall not constitute Indebtedness or a Capitalized Lease Obligation of the Borrower or any Subsidiary under this Agreement or any other Loan Document as a result of such changes in GAAP.

 

SECTION 1.03                                           Effectuation of Transactions.  Each of the representations and warranties of the Borrower contained in this Agreement (and all corresponding definitions) are made after giving effect to the Transactions (or such portion thereof as shall be consummated as of the date of the applicable representation or warranty), unless the context otherwise requires.

 

SECTION 1.04                                           Exchange Rates; Currency Translation.

 

(a)                                 The Administrative Agent shall determine the Spot Rate as of each Revaluation Date to be used for calculating Dollar Equivalent amounts of Alternate Currency Letters of Credit and Alternate Currency Loans.  Such Spot Rate shall become effective as of such Revaluation Date and shall be the Spot Rate employed in converting any amounts between the Dollars and each Alternate Currency until the next Revaluation Date to occur.  Except for purposes of financial statements delivered by Loan Parties hereunder or calculating financial ratios hereunder or except as otherwise provided herein, the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent amount as determined by the Administrative Agent in accordance with this Agreement.  No Default or Event of Default shall arise as a result of any limitation or threshold set forth in U.S. Dollars in Article VI or clause (f) or (j) of Section 7.01 being exceeded solely as a result of changes in currency exchange rates from those rates applicable on the first day of the fiscal quarter in which such determination occurs or in respect of which such determination is being made.

 

(b)                                 Wherever in this Agreement in connection with a Borrowing, conversion, continuation or prepayment of a Eurocurrency Loan or the issuance, amendment or extension of a Letter of Credit, an amount, such as a required minimum or multiple amount, is expressed in Dollars, but such

 

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Borrowing, Eurocurrency Loan or Letter of Credit is denominated in an Alternate Currency, such amount shall be the Alternate Currency Equivalent of such Dollar amount (rounded to the nearest unit of such Alternate Currency, with 0.5 of a unit being rounded upward), as determined by the Administrative Agent or the applicable Issuing Bank, as applicable.

 

SECTION 1.05                                           Letter of Credit Amounts.  Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall at all times be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

 

SECTION 1.06                                           Additional Alternate Currencies for Loans.

 

(a)                                 The Borrower may from time to time request that Eurocurrency Revolving Loans be made in a currency other than Dollars; provided that such requested currency is a lawful currency (other than Dollars) that is readily available and freely transferable and convertible into Dollars.  Such request shall be subject to the approval of the Administrative Agent.

 

(b)                                 Any such request shall be made to the Administrative Agent not later than 11:00 a.m., 20 Business Days prior to the date of the desired Credit Event (or such other time or date as may be agreed by the Administrative Agent, in its sole discretion).  The Administrative Agent shall promptly notify each Revolving Facility Lender thereof.  Each Revolving Facility Lender shall notify the Administrative Agent, not later than 11:00 a.m., 10 Business Days after receipt of such request whether it consents, in its sole discretion, to the making of Eurocurrency Revolving Loans in such requested currency.

 

(c)                                  Any failure by a Revolving Facility Lender to respond to such request within the time period specified in the preceding sentence shall be deemed to be a refusal by such Revolving Facility Lender to permit Eurocurrency Revolving Loans to be made in such requested currency.  If the Administrative Agent and all the Revolving Facility Lenders consent to making Eurocurrency Revolving Loans in such requested currency, the Administrative Agent shall so notify the Borrower and such currency shall thereupon be deemed for all purposes to be an Alternate Currency hereunder for purposes of any Borrowings of Eurocurrency Revolving Loans. If the Administrative Agent shall fail to obtain consent to any request for an additional currency under this Section 1.06, the Administrative Agent shall promptly so notify the Borrower.

 

SECTION 1.07                                           Change of Currency.

 

(a)                                         Each obligation of the Borrower to make a payment denominated in the national currency unit of any member state of the European Union that adopts the Euro as its lawful currency after the Closing Date shall be redenominated into Euro at the time of such adoption (in accordance with the EMU Legislation).  If, in relation to the currency of any such member state, the basis of accrual of interest expressed in this Agreement in respect of that currency shall be inconsistent with any convention or practice in the London interbank market for the basis of accrual of interest in respect of the Euro, such expressed basis shall be replaced by such convention or practice with effect from the date on which such member state adopts the Euro as its lawful currency; provided that if any Borrowing in the currency of such member state is outstanding immediately prior to such date, such replacement shall take effect, with respect to such Borrowing, at the end of the then current Interest Period.

 

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(b)                                         Each provision of this Agreement shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify to be appropriate to reflect the adoption of the Euro by any member state of the European Union and any relevant market conventions or practices relating to the Euro.

 

(c)                                          Each provision of this Agreement also shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify to be appropriate to reflect a change in currency of any other country and any relevant market conventions or practices relating to the change in currency.

 

SECTION 1.08                                           Timing of Payment or Performance.  Except as otherwise expressly provided herein, when the payment of any obligation or the performance of any covenant, duty or obligation is stated to be due or performance required on a day which is not a Business Day, the date of such payment or performance shall extend to the immediately succeeding Business Day.

 

SECTION 1.09                                           Times of Day.  Unless otherwise specified herein, all references herein to times of day shall be references to New York City time (daylight or standard, as applicable).

 

ARTICLE II
 THE CREDITS

 

SECTION 2.01                                           Commitments.  Subject to the terms and conditions set forth herein:

 

(a)                                 the 2018 Term Lenders agree to make, on the Repricing Effective Date, 2018 Term Loans to the Borrower in an aggregate principal amount of $373,437,500, subject to the terms and conditions set forth in the First Amendment;

 

(b)                                 each Revolving Facility Lender agrees from time to time during the Revolving Availability Period to make Revolving Facility Loans of a Class in U.S. Dollars to the Borrower from its U.S. Lending Office in an aggregate principal amount that will not result in such Lender’s Revolving Facility Exposure of such Class exceeding such Lender’s Revolving Facility Commitment of such Class;

 

(c)                                  each Lender having an Incremental Term Loan Commitment agrees, subject to the terms and conditions set forth in the applicable Incremental Assumption Agreement, to make Incremental Term Loans to the Borrower to the Borrower, in an aggregate principal amount not to exceed its Incremental Term Loan Commitment; and

 

(d)                                 within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Facility Loans.  Amounts repaid in respect of Term B Loans may not be reborrowed.

 

SECTION 2.02                                           Loans and Borrowings.

 

(a)                                 Each Loan shall be made as part of a Borrowing consisting of Loans of the same Class and Type made by the Lenders ratably in accordance with their respective Commitments of the applicable Class; provided, however, that Revolving Facility Loans of any Class shall be made by the Revolving Facility Lenders of such Class ratably in accordance with their respective Applicable Percentages on the date such Loans are made hereunder.  The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

 

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(b)                                 Subject to Section 2.14, each Borrowing shall be comprised entirely of ABR Loans or Eurocurrency Loans as the Borrower may request in accordance herewith.  Each Lender at its option may make any ABR Loan or Eurocurrency Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement and such Lender shall not be entitled to any amounts payable under Section 2.15 or 2.17 solely in respect of increased costs or taxes resulting from such exercise and existing at the time of such exercise.

 

(c)                                  At the commencement of each Interest Period for any Eurocurrency Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum.  At the time that (i) each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the Revolving Facility Commitments or that is required to finance the reimbursement of an L/C Disbursement as contemplated by Section 2.05(e).  Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of (i) 10 Eurocurrency Borrowings outstanding under each of the Term B Loans or any Other Term Loans at any time and (ii) 10 Eurocurrency Borrowings outstanding under each of the Revolving Facility or any Other Revolving Facility Loans at any time.

 

(d)                                 Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing of any Class if the Interest Period requested with respect thereto would end after the Revolving Facility Maturity Date or the Term Facility Maturity Date for such Class, as applicable.

 

SECTION 2.03                                           Requests for Borrowings.  To request a Revolving Facility Borrowing and/or a Term Borrowing, the Borrower shall notify the Administrative Agent of such request (as provided in Section 9.01) by telephone (a) in the case of a Eurocurrency Borrowing, not later than 12:00 p.m., Local Time, three Business Days before the date of the proposed Borrowing, (b) in the case of an ABR Term Loan Borrowing, not later than 12:00 p.m., Local Time, one Business Day before the date of the proposed Borrowing, and (c) in the case of an ABR Revolving Borrowing, not later than 11:00 a.m., Local Time, on the Business Day of the proposed Borrowing; provided that (i) any such notice of an ABR Revolving Borrowing to finance the reimbursement of an L/C Disbursement as contemplated by Section 2.05(e) may be given not later than 11:00 a.m., Local Time, on the date of the proposed Borrowing and (ii) any such notice of a borrowing under an Incremental Revolving Facility Commitment or an Incremental Term Borrowing may be given at such time as provided in the applicable Incremental Assumption Agreement.  Each such telephonic Borrowing Request shall be irrevocable (other than in the case of any notice given in respect of the Closing Date, which may be conditioned upon the consummation of the Business Combination or, in the case of notice given in respect of Incremental Term Loan Commitments or Incremental Revolving Facility Commitments, which may be conditioned as provided in the applicable Incremental Assumption Agreement) and shall be confirmed promptly by hand delivery or electronic means to the Administrative Agent of a written Borrowing Request signed by the Borrower.  Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:

 

(i)                                     the Class of such Borrowing;

 

(ii)                                  the aggregate amount of the requested Borrowing;

 

(iii)                               the date of such Borrowing, which shall be a Business Day;

 

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(iv)                              whether such Borrowing is to be an ABR Borrowing or a Eurocurrency Borrowing;

 

(v)                                 in the case of a Eurocurrency Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”;

 

(vi)                              in the case of a Eurocurrency Revolving Borrowing, the currency in which such Borrowing is to be denominated (which shall be Dollars or an Alternate Currency); and

 

(vii)                           the location and number of the Borrower’s account to which funds are to be disbursed.

 

If no election as to the currency of any Revolving Facility Borrowing is made, then the requested Borrowing shall be made in Dollars.  If no election as to the Type of Revolving Facility Borrowing is specified, then the requested Revolving Facility Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with respect to any requested Eurocurrency Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section 2.03, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

SECTION 2.04                                           [Reserved].

 

SECTION 2.05                                           Letters of Credit.

 

(a)                                 General.  Subject to the terms and conditions set forth herein, the Borrower may request the issuance of one or more letters of credit or bank guarantees in Dollars or any Alternate Currency in the form of (x) trade letters of credit or bank guarantees in support of trade obligations of the Borrower and its Subsidiaries incurred in the ordinary course of business (such letters of credit or bank guarantees issued for such purposes, “Trade Letters of Credit”) and (y) standby letters of credit issued for any other lawful purposes of the Borrower and its Subsidiaries (such letters of credit issued for such purposes, “Standby Letters of Credit”; each such letter of credit or bank guarantee, issued hereunder, a “Letter of Credit” and collectively, the “Letters of Credit”) for its own account or for the account of any Subsidiary; provided that no Issuing Bank shall be required to issue any Trade Letters of Credit or any other type of Letter of Credit that is not a Standby Letter of Credit unless it agrees to do so in its sole discretion.  Subject to the terms and conditions set forth herein, (i) each Issuing Bank agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.05, from time to time on any Business Day during the applicable Revolving Availability Period, to issue Letters of Credit for the account of the Borrower or its Subsidiaries, and to amend Letters of Credit previously issued by it, in accordance with subsection (b) below, and to honor drawings of Letters of Credit; and (ii) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower or its Subsidiaries and any drawings thereunder; provided that after giving effect to any issuance of any Letter of Credit, (x) the total Revolving Facility Exposure of any Class shall not exceed the total Revolving Facility Commitments of such Class, (y) the Revolving Facility Exposure of any Lender of any Class shall not exceed such Lender’s respective Revolving Facility Commitment of such Class, and (z) the L/C Exposure shall not exceed the aggregate L/C Commitments.  Each request by the Borrower for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Borrower that the issuance or amendment of such Letter of Credit so requested complies with the conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s

 

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ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.  In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of Letter of Credit Application or other agreement submitted by the Borrower to, or entered into by the Borrower with, an Issuing Bank relating to any Letter of Credit (collectively, the “Issuer Documents”), the terms and conditions of this Agreement shall control.

 

(b)                                 Notice of Issuance, Amendment, Renewal, Extension.  (i)                            Each Letter of Credit shall be issued or amended (other than an automatic extension in accordance with clause (i) of this Section 2.05), as the case may be, upon the request of the Borrower delivered to the applicable Issuing Bank (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower.  Such Letter of Credit Application must be received by the applicable Issuing Bank and the Administrative Agent not later than 11:00 a.m. at least two Business Days (or such later date and time as the Administrative Agent and the applicable Issuing Bank may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be.  In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to the applicable Issuing Bank:  (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the stated amount and currency (which may be Dollars or any Alternate Currency) thereof; (C) the expiry date thereof (and any “evergreen” renewals, if any, including the terms thereof); (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the purpose and nature of the requested Letter of Credit; and (H) such other matters as such Issuing Bank may require.  In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to the applicable Issuing Bank: (w) the Letter of Credit to be amended; (x) the proposed date of amendment thereof (which shall be a Business Day); (y) the nature of the proposed amendment; and (z) such other matters as such Issuing Bank may require.  Additionally, the Borrower shall furnish to the applicable Issuing Bank and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as such Issuing Bank or the Administrative Agent may require.

 

(ii)                                  Promptly after receipt of any Letter of Credit Application, the applicable Issuing Bank will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower.  Unless the applicable Issuing Bank has received written notice from any Lender, the Administrative Agent or any Loan Party, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Section 4.01 shall not then be satisfied, then, subject to the terms and conditions hereof, such applicable Issuing Bank shall, on the requested date, issue a Letter of Credit for the account of the Borrower or the applicable Subsidiary or enter into the applicable amendment, as the case may be, in each case in accordance with such Issuing Bank’s usual and customary business practices.  Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the applicable Issuing Bank a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.

 

(iii)                               Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank or confirming bank with respect thereto or to the beneficiary

 

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thereof, the applicable Issuing Bank will also deliver to the Borrower a true and complete copy of such Letter of Credit or amendment.

 

(c)                                  Drawings and Reimbursements; Funding of Participations.  (i)  Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the applicable Issuing Bank shall notify the Borrower and the Administrative Agent thereof.  Not later than 11:00 a.m. on the date of any payment by the applicable Issuing Bank under a Letter of Credit (each such date, an “Honor Date”), the Borrower shall reimburse the applicable Issuing Bank through the Administrative Agent in an amount equal to the amount of such drawing.  If the Borrower fails to so reimburse the applicable Issuing Bank by such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof.  In such event, the Borrower shall be deemed to have requested a Borrowing of ABR Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of ABR Loans, but subject to the amount of the unutilized portion of the Commitments and the conditions set forth in Section 4.01 (other than the delivery of a Borrowing Request).  Any notice given by the applicable Issuing Bank or the Administrative Agent pursuant to this Section 2.05(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

 

(ii)                                  Each Lender shall upon any notice pursuant to Section 2.05(c)(i) make funds available to the Administrative Agent (and the Administrative Agent may apply Cash Collateral provided for this purpose) for the account of the applicable Issuing Bank in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.05(c)(iii), each Lender that so makes funds available shall be deemed to have made an ABR Loan to the Borrower in such amount.  The Administrative Agent shall remit the funds so received to the applicable Issuing Bank.

 

(iii)                               With respect to any Unreimbursed Amount that is not fully refinanced by a Borrowing of ABR Loans because the conditions set forth in Section 4.01 cannot be satisfied or for any other reason, the Borrower shall be deemed to have incurred from the applicable Issuing Bank an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the rate specified in Section 2.13.  In such event, each Lender’s payment to the Administrative Agent for the account of the applicable Issuing Bank pursuant to Section 2.05(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.05.

 

(iv)                              Until each Lender funds its Loan or L/C Advance pursuant to this Section 2.05(c) to reimburse applicable Issuing Bank for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of the applicable Issuing Bank.

 

(v)                                 Each Lender’s obligation to make Loans or L/C Advances to reimburse the applicable Issuing Bank for amounts drawn under Letters of Credit, as contemplated by this Section 2.05(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the applicable Issuing Bank, the Borrower or any other person for any reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any other

 

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occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Loans pursuant to this Section 2.05(c) is subject to the conditions set forth in Section 4.01 (other than delivery by the Borrower of a Borrowing Request).  No such making of an L/C Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse the applicable Issuing Bank for the amount of any payment made by the Issuing Bank under any Letter of Credit, together with interest as provided herein.

 

(vi)                              If any Lender fails to make available to the Administrative Agent for the account of the applicable Issuing Bank any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.05(c) by the time specified in Section 2.05(c)(ii), then, without limiting the other provisions of this Agreement, the applicable Issuing Bank shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the applicable Issuing Bank at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the applicable Issuing Bank in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the applicable Issuing Bank in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Loan included in the relevant Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be.  A certificate of the applicable Issuing Bank submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

 

(d)                                 Repayment of Participations.

 

(i)                                     At any time after the applicable Issuing Bank has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.05(c), if the Administrative Agent receives for the account of the applicable Issuing Bank any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by the Administrative Agent.

 

(ii)                                  If any payment received by the Administrative Agent for the account of any Issuing Bank pursuant to Section 2.05(c)(i) is required to be returned under any of the circumstances described in Section 9.07 (including pursuant to any settlement entered into by the applicable Issuing Bank in its discretion), each Lender shall pay to the Administrative Agent for the account of the applicable Issuing Bank its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders under this clause shall survive the payment in full of the Loan Obligations and the termination of this Agreement.

 

(e)                                  Obligations Absolute.  The obligation of the Borrower to reimburse the Issuing Banks for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

 

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(i)                                     any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

 

(ii)                                  the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any person for whom any such beneficiary or any such transferee may be acting), the applicable Issuing Bank or any other person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

 

(iii)                               any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

 

(iv)                              any payment by the applicable Issuing Bank under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the applicable Issuing Bank under such Letter of Credit to any person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

 

(v)                                 any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any Subsidiary.

 

The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the applicable Issuing Bank.  The Borrower shall be conclusively deemed to have waived any such claim against the applicable Issuing Bank and its correspondents unless such notice is given as aforesaid.

 

(f)                                   Role of the Issuing Banks.  Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, no Issuing Bank shall have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the person executing or delivering any such document.  Neither any Issuing Bank, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of any Issuing Bank shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document.  The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement.  Neither any Issuing Bank, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of any Issuing Bank shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.05(e); provided, however, that anything in such clauses to the contrary

 

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notwithstanding, the Borrower may have a claim against an Issuing Bank, and such Issuing Bank may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrower which the Borrower proves were caused by such Issuing Bank’s willful misconduct or gross negligence or such Issuing Bank’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the foregoing, any Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, no Issuing Bank shall be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

 

(g)                                  Unless otherwise expressly agreed by the applicable Issuing Bank and the Borrower when a Letter of Credit is issued, the rules of the ISP or UCP shall apply to each Standby Letter of Credit.

 

(h)                                 Certain Conditions.  No Issuing Bank shall be under any obligation to issue any Letter of Credit if:

 

(i)                                     any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the applicable Issuing Bank from issuing the Letter of Credit, or any Law applicable to the applicable Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the applicable Issuing Bank shall prohibit, or request that the applicable Issuing Bank refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon the applicable Issuing Bank with respect to the Letter of Credit any restriction, reserve or capital requirement (for which the applicable Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the applicable Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the applicable Issuing Bank in good faith deems material to it;

 

(ii)                                  the issuance of the Letter of Credit would violate one or more policies of the applicable Issuing Bank applicable to letters of credit generally;

 

(iii)                               an Alternate Currency Letter of Credit if such Issuing Bank does not otherwise issue letters of credit in such Alternate Currency; or

 

(iv)                              any Lender is at that time a Defaulting Lender, unless the applicable Issuing Bank has entered into arrangements, including the delivery of Cash Collateral, reasonably satisfactory to the applicable Issuing Bank (in its sole discretion) with the Borrower or such Lender to eliminate such Issuing Bank’s actual or potential Fronting Exposure (after giving effect to Section 2.23(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to be issued or that Letter of Credit and all other Letter of Credit obligations as to which the applicable Issuing Bank has actual or potential Fronting Exposure, as it may elect in its sole discretion.

 

(i)                                     Expiration Date.  Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date one year (unless otherwise agreed upon by the Borrower and the Issuing Banks in their sole discretion) after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year (unless otherwise agreed upon by the Borrower and the Issuing Banks in their sole discretion) after such renewal or extension) and (ii) the date that is five

 

74

 

Business Days prior to the applicable Revolving Facility Maturity Date; provided that any Letter of Credit with a one-year tenor may provide for the automatic renewal or extension thereof for additional one-year periods (which, in no event, shall extend beyond the applicable date referred to in clause (ii) of this Section 2.05(i)); provided, further, that if such Issuing Bank consents in its sole discretion, the expiration date on any Letter of Credit may extend beyond the date referred to in clause (ii) above, provided that if any such Letter of Credit is outstanding or is issued under the Revolving Facility Commitments of any Class after the date that is five Business Days prior to the Revolving Facility Maturity Date for such Class the Borrower shall backstop or provide Cash Collateral pursuant to documentation reasonably satisfactory to the Administrative Agent and the relevant Issuing Bank in an amount equal to the face amount of each such Letter of Credit on or prior to the date that is five Business Days prior to such Revolving Facility Maturity Date or, if later, such date of issuance.

 

(j)                                    Replacement of an Issuing Bank.  An Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.  The Administrative Agent shall notify the Lenders of any such replacement of an Issuing Bank.  At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of the replaced Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require.  After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of such Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement but shall not be required to issue additional Letters of Credit.

 

(k)                                 Additional Issuing Banks.  From time to time, the Borrower may by notice to the Administrative Agent designate any Lender (in addition to the initial Issuing Banks), each of which agrees (in its sole discretion) to act in such capacity and each of which is reasonably satisfactory to the Administrative Agent as an Issuing Bank.  Each such additional Issuing Bank shall execute a counterpart of this Agreement upon the approval of the Administrative Agent (which approval shall not be unreasonably withheld) and shall thereafter be an Issuing Bank hereunder for all purposes.

 

(l)                                     Issuing Bank Agreements.  Unless otherwise requested by the Administrative Agent, each Issuing Bank shall report in writing to the Administrative Agent (i) on the first Business Day of each month, the daily activity (set forth by day) in respect of Letters of Credit during the immediately preceding month, including all issuances, extensions, amendments and renewals, all expirations and cancellations and all disbursements and reimbursements, (ii) on or prior to each Business Day on which such Issuing Bank expects to issue, amend, renew or extend any Letter of Credit, the date of such issuance, amendment, renewal or extension, and the aggregate face amount of the Letters of Credit to be issued, amended, renewed or extended by it and outstanding after giving effect to such issuance, amendment, renewal or extension occurred (and whether the amount thereof changed), it being understood that such Issuing Bank shall not permit any issuance, renewal, extension or amendment resulting in an increase in the amount of any Letter of Credit to occur without first obtaining written (or, with respect to any Issuing Bank, if the Administrative Agent so agrees with respect to such Issuing Bank, telephonic) confirmation from the Administrative Agent that it is then permitted under this Agreement, (iii) on each Business Day on which such Issuing Bank makes any L/C Disbursement in respect of any Letter of Credit issued, the date of such L/C Disbursement and the amount of such L/C Disbursement, (iv) on any Business Day on which the Borrower fails to reimburse an L/C Disbursement required to be reimbursed to such Issuing Bank on such day, the date of such failure and the amount of such L/C

 

75

 

Disbursement and (v) on any other Business Day, such other information as the Administrative Agent shall reasonably request.

 

SECTION 2.06                                           Funding of Borrowings.

 

(a)                                 Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Local Time, in the case of any Borrowing of Eurocurrency Loans (or by 4:00 p.m., Local Time, in the case of any Borrowing of ABR Loans) to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders.  The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account or accounts of the Borrower designated by the Borrower in the applicable Borrowing Request; provided that ABR Revolving Loans made to finance the reimbursement of a L/C Disbursement pursuant to Section 2.05(c) shall be remitted by the Administrative Agent to the applicable Issuing Bank.

 

(b)                                 Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing of Eurocurrency Loans (or, in the case of any Borrowing of ABR Loans, prior to 12:00 noon on the date of such Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date and at the time required by Section 2.06(a) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower each severally agree to pay to the Administrative Agent forthwith on demand (without duplication) such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to ABR Loans.  If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such Borrowing.  Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

 

(c)                                  The foregoing notwithstanding, the Administrative Agent, in its sole discretion, may from its own funds make a Revolving Facility Loan on behalf of the Lenders.  In such event, the applicable Lenders on behalf of whom the Administrative Agent made the Revolving Facility Loan shall reimburse the Administrative Agent for all or any portion of such Revolving Facility Loan made on its behalf upon written notice given to each applicable Lender not later than 2:00 p.m., Local Time, on the Business Day such reimbursement is requested.  The entire amount of interest attributable to such Revolving Facility Loan for the period from and including the date on which such Revolving Facility Loan was made on such Lender’s behalf to but excluding the date the Administrative Agent is reimbursed in respect of such Revolving Facility Loan by such Lender shall be paid to the Administrative Agent for its own account.

 

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SECTION 2.07                                           Interest Elections.

 

(a)                                 Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurocurrency Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurocurrency Borrowing, may elect Interest Periods therefor, all as provided in this Section.  The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans resulting from an election made with respect to any such portion shall be considered a separate Borrowing.

 

(b)                                 To make an election pursuant to this Section 2.07, the Borrower shall notify the Administrative Agent of such election (as provided in Section 9.01) by telephone, in the case of an election that would result in a Borrowing, by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election.  Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or electronic transmission to the Administrative Agent of a written Interest Election Request in a form approved by the Administrative Agent and signed by the Borrower.  Notwithstanding any other provision of this Section 2.07, the Borrower shall not be permitted to (i) change the currency of any Borrowing, (ii) elect an Interest Period for Eurocurrency Loans that does not comply with Section 2.02(d) or (iii) convert any Borrowing to a Borrowing not available under the Class of Commitments pursuant to which such Borrowing was made.

 

(c)                                  Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:

 

(i)                                     the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

(ii)                                  the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

 

(iii)                               whether the resulting Borrowing is to be an ABR Borrowing or a Eurocurrency Borrowing; and

 

(iv)                              if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period.”

 

If any such Interest Election Request requests a Eurocurrency Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  If less than all the outstanding principal amount of any Borrowing shall be converted or continued, then each resulting Borrowing shall be in an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum and satisfy the limitations specified in Section 2.02(c) regarding the maximum number of Borrowings of the relevant Type.

 

(d)                                 Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender to which such Interest Election Request relates of the details thereof and of such Lender’s portion of each resulting Borrowing.

 

77

 

(e)                                  If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurocurrency Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing.  Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the written request (including a request through electronic means) of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurocurrency Borrowing and (ii) unless repaid, each Eurocurrency Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.

 

SECTION 2.08                                           Termination and Reduction of Commitments.

 

On the Repricing Effective Date (after giving effect to the exchange of the Existing Term Loans) (as defined in the First Amendment) by the Cashless Settlement Repricing Lenders (as defined in the First Amendment) for 2018 Repriced Term Loans (as defined in the First Amendment) and the funding of the Additional Term Loans (as defined in the First Amendment) to be made on such date), the 2018 Repricing Commitments (as defined in the First Amendment) and the Increase Commitments  (as defined in the First Amendment) of each 2018 Term Lender as of the Repricing Effective Date will terminate.  Unless previously terminated, the Revolving Facility Commitments of each Class shall terminate on the applicable Revolving Facility Maturity Date for such Class.

 

(a)                                 The Borrower may at any time terminate, or from time to time reduce, the Revolving Facility Commitments of any Class; provided that (i) each reduction of the Revolving Facility Commitments of any Class shall be in an amount that is an integral multiple of $500,000 and not less than $1,000,000 (or, if less, the remaining amount of the Revolving Facility Commitments of such Class) and (ii) the Borrower shall not terminate or reduce the Revolving Facility Commitments of any Class if, after giving effect to any concurrent prepayment or reduction of the Revolving Facility Loans in accordance with Section 2.11 and any Cash Collateralization of Letters of Credit in accordance with Section 2.22, the total Revolving Facility Exposure of such Class (excluding any Cash Collateralized Letters of Credit) would exceed the total Revolving Facility Commitments of such Class; provided, further, that, the Borrower may terminate the unused Revolving Facility Commitments of any Defaulting Lender at any time, or from time to time, in any amounts and without a pro rata reduction of the Revolving Facility Commitments of the other Lenders.

 

(b)                                 The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Revolving Facility Commitments of any Class under clause (b) of this Section 2.08 at least three Business Days prior to the effective date of such termination or reduction (or such shorter period acceptable to the Administrative Agent), specifying such election and the effective date thereof.  Promptly following receipt of any notice, the Administrative Agent shall advise the applicable Lenders of the contents thereof.  Each notice delivered by the Borrower pursuant to this Section 2.08 shall be irrevocable; provided that a notice of termination or reduction of the Revolving Facility Commitments of any Class delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, indentures or similar agreements or other transactions in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Any termination or reduction of the Commitments of any Class pursuant to this Section 2.08 shall be permanent.  Each reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Commitments of such Class.

 

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SECTION 2.09                                           Repayment of Loans; Evidence of Debt.

 

(a)                                 The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Revolving Facility Lender the then unpaid principal amount of each Revolving Facility Loan of such Lender to the Borrower on the Revolving Facility Maturity Date applicable to such Revolving Facility Loans and (ii) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Term Loan of such Lender to the Borrower as provided in Section 2.10.

 

(b)                                 Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

 

(c)                                  The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period (if any) applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) any amount received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.

 

(d)                                 The entries made in the accounts maintained pursuant to clause (b) or (c) of this Section 2.09 shall be prima facie evidence of the existence, currencies and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.

 

(e)                                  Any Lender may request that Loans of any Class made by it be evidenced by a promissory note (a “Note”).  In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Administrative Agent and reasonably acceptable to the Borrower.  Thereafter, unless otherwise agreed to by the applicable Lender, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the payee named therein (or, if requested by such payee, to such payee and its registered assigns).

 

SECTION 2.10                                           Repayment of Term Loans and Revolving Facility Loans.  (a) Subject to the other clauses of this Section 2.10 and to Section 9.09(e),

 

(i)                                     the Borrower shall repay the Term B Loans incurred on the Repricing Effective Date in installments on the dates and in the respective amounts shown below, or, if any such date is not a Business Day, on the next preceding Business Day (each such date being referred to as a “Term B Loan Installment Date”):

 

79

 

	
Term B Loan Installment Date
    	
 
    	
Amount of Term B Loans Payment
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
September 30,   2018
    	
 
    	
$
    	
2,378,582.80
    	
 
    
	
December 31,   2018
    	
 
    	
$
    	
2,378,582.80
    	
 
    
	
March 31,   2019
    	
 
    	
$
    	
2,378,582.80
    	
 
    
	
June 30,   2019
    	
 
    	
$
    	
2,378,582.80
    	
 
    
	
September 30,   2019
    	
 
    	
$
    	
2,378,582.80
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
December 31,   2019
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
March 31,   2020
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
June 30,   2020
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
September 30,   2020
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
December 31,   2020
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
March 31,   2021
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
June 30,   2021
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
September 30,   2021
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
December 31,   2021
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
March 31,   2022
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
June 30,   2022
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
September 30,   2022
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
December 31,   2022
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
March 31,   2023
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
June 30, 2023
    	
 
    	
$
    	
4,757,165.61
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Term B Facility   Maturity Date
    	
 
    	
An amount equal to the   then unpaid principal amount of such Term B Loans outstanding
    	
 
    

 

(ii)                                  in the event that any Incremental Term Loans are made, the Borrower shall repay such Incremental Term Loans on the dates and in the amounts set forth in the related Incremental Assumption Agreement (each such date being referred to as an “Incremental Term Loan Installment Date”); and

 

(iii)                               to the extent not previously paid, outstanding Term Loans shall be due and payable on the applicable Term Facility Maturity Date.

 

(b)                                 To the extent not previously paid, outstanding Revolving Facility Loans shall be due and payable on the applicable Revolving Facility Maturity Date.

 

(c)                                  Prepayment of the Loans from:

 

(i)                                     all Net Proceeds pursuant to Section 2.11(b) and Excess Cash Flow pursuant to Section 2.11(c) shall be allocated to the Class or Classes of Term Loans determined pursuant to Section 2.10(d), with the application thereof to reduce in direct order amounts due on the succeeding Term Loan Installment Dates under such Classes as provided in the remaining scheduled amortization payments under such Classes;  provided that any Lender, at its option, may elect to decline any such prepayment of any Term Loan held by it if it shall give written notice to the Administrative Agent thereof by 5:00 p.m. Local Time at least three Business Days prior to the date of such prepayment (any such Lender, a “Declining Lender”) and on the date of any such prepayment, any amounts that would otherwise have been applied to prepay Term Loans owing to Declining Lenders (such amounts, the “Declined Proceeds”) shall instead be retained by the Borrower for application for any purpose not prohibited by this Agreement, and

 

(ii)                                  any optional prepayments of the Term Loans pursuant to Section 2.11(a) shall be applied to the remaining installments of the Term Loans under the applicable Class or Classes as directed by the Borrower.

 

(d)                                 Any mandatory prepayment of Term Loans pursuant to Section 2.11(b) or (c) shall be applied so that the aggregate amount of such prepayment is allocated among the Term B Loans and the Other Term Loans, if any, pro rata based on the aggregate principal amount of outstanding Term

 

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B Loans and Other Term Loans, if any; provided that, subject to the pro rata application to Loans outstanding within any Class of Term Loans, the Borrower may allocate such prepayment in its discretion among the Class or Classes of Term Loans as the Borrower may specify (so long as such allocation complies with Section 2.20(b) or Section 2.20(f), as applicable).  Prior to any prepayment of any Loan or Loans hereunder, the Borrower shall select the Borrowing or Borrowings constituting such Loan or Loans to be prepaid or reduced and shall notify the Administrative Agent in the form of a written Prepayment or Reduction Notice of such selection (i) in the case of an ABR Borrowing, not later than 2:00 p.m. Local Time, one Business Day before the scheduled date of such prepayment and (ii) in the case of a Eurocurrency Borrowing, not later than 2:00 p.m. Local Time, three Business Days before the scheduled date of such prepayment or reduction (or, in each case such shorter period acceptable to the Administrative Agent); provided that a Prepayment or Reduction Notice may state that such notice is conditioned upon the effectiveness of other credit facilities, indentures or similar agreements or other transactions, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Each repayment of a Borrowing (x) in the case of the Revolving Facility of any Class, shall be applied to the Revolving Facility Loans included in the repaid Borrowing such that each Revolving Facility Lender receives its ratable share of such repayment (based upon the respective Revolving Facility Exposures of the Revolving Facility Lenders of such Class at the time of such repayment) and (y) in all other cases, shall be applied ratably to the Loans included in the repaid Borrowing.  All repayments of Loans shall be accompanied by accrued interest on the amount repaid to the extent required by Section 2.13(d).

 

SECTION 2.11                                           Prepayment of Loans.

 

(a)                                 The Borrower shall have the right, in its sole discretion, at any time and from time to time to prepay any Loan in whole or in part, without premium or penalty (but subject to Section 2.12(d) and Section 2.16), in an aggregate principal amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum or, if less, the amount outstanding, subject to prior notice in accordance with Section 2.10(d).

 

(b)                                 The Borrower shall apply all Net Proceeds promptly upon receipt thereof to prepay Term Loans in accordance with clauses (c) and (d) of Section 2.10.  Notwithstanding the foregoing, the Borrower may use a portion of such Net Proceeds to prepay or repurchase any Other First Lien Debt, in each case in an amount not to exceed the product of (x) the amount of such Net Proceeds and (y) a fraction, (A) the numerator of which is the outstanding principal amount of such Other First Lien Debt and (B) the denominator of which is the sum of the outstanding principal amount of such Other First Lien Debt and the outstanding principal amount of all Classes of Term Loans.

 

(c)                                  Not later than five Business Days after the date on which the annual financial statements are, or are required to be, delivered under Section 5.04(a) with respect to each Excess Cash Flow Period, the Borrower shall calculate Excess Cash Flow for such Excess Cash Flow Period and, if and to the extent the amount of such Excess Cash Flow exceeds $5,000,000 (the “ECF Threshold Amount”), the Borrower shall apply an amount equal to (i) the Required Percentage of such excess portion of such Excess Cash Flow minus (ii) to the extent not financed using the proceeds of the incurrence of funded term Indebtedness, the sum of (A) the amount of any voluntary payments during such Excess Cash Flow Period (plus, without duplication of any amounts previously deducted under this clause (A), the amount of any voluntary payments after the end of such Excess Cash Flow Period but before the date of prepayment under this clause (c)) of (x) Term Loans (it being understood that the amount of any such payment constituting a below-par Permitted Loan Purchase shall be calculated to equal the amount of cash used and not the principal amount deemed prepaid therewith) and (y) Other First Lien Debt (provided that in the case of the prepayment of any revolving Indebtedness, there was a corresponding reduction in commitments; provided, further, that the maximum amount of each such

 

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prepayment of Other First Lien Debt that may be counted for purposes of this clause (A)(y) shall not exceed the amount that would have been prepaid in respect of such Other First Lien Debt if such prepayment had been applied on a ratable basis among the Term Loans and such Other First Lien Debt (determined based on the aggregate outstanding principal amount of Term Loans and the aggregate principal amount of such Other First Lien Debt on the date of such prepayment)) and (B) the amount of any permanent voluntary reductions during such Excess Cash Flow Period (plus, without duplication of any amounts previously deducted under this clause (B), the amount of any permanent voluntary reductions after the end of such Excess Cash Flow Period but before the date of prepayment under this clause (c)) of Revolving Facility Commitments to the extent that an equal amount of Revolving Facility Loans was simultaneously repaid, (I) to prepay Term Loans in accordance with clauses (c) and (d) of Section 2.10 or (II) to prepay Term Loans in accordance with clauses (c) and (d) of Section 2.10 and to prepay any Other First Lien Debt in accordance with the agreement(s) governing such Other First Lien Debt so long as the prepayments under this clause (II) are applied in a manner such that the Term Loans are prepaid on at least a ratable basis with such Other First Lien Debt (determined based on the aggregate outstanding principal amount of Term Loans and the aggregate outstanding principal amount of such Other First Lien Debt being prepaid under this clause (II) on the date of such prepayments).  Such calculation will be set forth in a certificate signed by a Financial Officer of the Borrower delivered to the Administrative Agent setting forth the amount, if any, of Excess Cash Flow for such fiscal year, the amount of any required prepayment in respect thereof and the calculation thereof in reasonable detail.

 

(d)                                 Notwithstanding any other provisions of this Section 2.11 to the contrary, (i) to the extent that any Net Proceeds of any Asset Sale or Casualty Event by a Foreign Subsidiary or Excess Cash Flow attributable to a Foreign Subsidiary would otherwise be required to be applied pursuant to Section 2.11(b) or Section 2.11(c) but is prohibited, restricted or delayed by applicable local law from being repatriated to the United States of America, the portion of such Net Proceeds or Excess Cash Flow so affected will not be required to be applied to repay Term Loans or Other First Lien Debt at the times provided in Section 2.11(b) or Section 2.11(c) but may be retained by the applicable Foreign Subsidiary so long, but only so long, as the applicable local law will not permit repatriation to the United States of America, and once such repatriation of any of such affected Net Proceeds or Excess Cash Flow is permitted under the applicable local law, such repatriation will be effected and such repatriated Net Proceeds or Excess Cash Flow will be promptly applied (net of additional taxes payable or reserved against as a result thereof) to the repayment of the Term Loans pursuant to Section 2.11(b) or Section 2.11(c), to the extent provided therein and (ii) to the extent that the Borrower, in consultation with the Administrative Agent, has determined in good faith that repatriation of any or all of such Net Proceeds or Excess Cash Flow that would otherwise be required to be applied pursuant to Section 2.11(b) or Section 2.11(c) would have a material adverse tax consequence to the Borrower or its Subsidiaries with respect to such Net Proceeds or Excess Cash Flow, the Net Proceeds or Excess Cash Flow so affected may be retained by the applicable Foreign Subsidiary (the Borrower hereby agreeing to cause the applicable Subsidiary to use commercially reasonable efforts to take all actions within the reasonable control of the Borrower that are reasonably required to eliminate such tax effects).

 

(e)                                  In the event and on such occasion that the total Revolving Facility Exposure of any Class exceeds the total Revolving Facility Commitments of such Class (other than as a result of changes in currency exchange rates), the Borrower shall prepay Revolving Facility Borrowings (or, if no such Borrowings are outstanding, provide Cash Collateral in respect of outstanding Letters of Credit pursuant to Section 2.22) in an aggregate amount equal to such excess.

 

(f)                                   In the event that the L/C Exposure exceeds the aggregate L/C Commitments (other than as a result of changes in currency exchange rates), at the request of the Administrative Agent, the Borrower shall backstop or provide Cash Collateral pursuant to Section 2.22 in an aggregate amount equal to such excess.

 

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(g)                                  If as a result of changes in currency exchange rates, on any Revaluation Date, (i) the total Revolving Facility Exposure of any Class exceeds the total Revolving Facility Commitments of such Class or (ii) the L/C Exposure exceeds the aggregate L/C Commitments, the Borrower shall, at the request of the Administrative Agent, within 10 days of such Revaluation Date (A) prepay Revolving Facility Borrowings or (B) provide Cash Collateral pursuant to Section 2.22, in an aggregate amount such that the applicable exposure does not exceed the applicable commitment set forth above.

 

SECTION 2.12                                           Fees.

 

(a)                                 The Borrower agrees to pay to each Revolving Facility Lender (other than any Defaulting Lender), through the Administrative Agent, on the date that is three Business Days after the last day of March, June, September and December in each year, and on the date on which the Revolving Facility Commitments of all the Revolving Facility Lenders shall be terminated as provided herein, a commitment fee (a “Commitment Fee”) on the daily amount of the applicable Available Unused Commitment of such Revolving Facility Lender during the preceding quarter (or shorter period commencing with the Closing Date or ending with the date on which the last of the Revolving Facility Commitments of such Lender shall be terminated), which shall accrue at a rate equal to the Applicable Commitment Fee accrued up to the last day on each March, June, September and December.  All Commitment Fees shall be computed on the basis of the actual number of days elapsed in a year of 360 days.  The Commitment Fee due to each Revolving Facility Lender shall commence to accrue on the Closing Date and shall cease to accrue on the date on which the last of the Revolving Facility Commitments of such Lender shall be terminated as provided herein.

 

(b)                                 The Borrower from time to time agrees to pay (i) to each Revolving Facility Lender of each Class (other than any Defaulting Lender), through the Administrative Agent, on the date that is three Business Days after the last day of March, June, September and December of each year and on the date on which the Revolving Facility Commitments of all the Lenders shall be terminated as provided herein, a fee in Dollars (an “L/C Participation Fee”) on such Lender’s Applicable Percentage of the daily aggregate L/C Exposure (excluding the portion thereof attributable to unreimbursed L/C Disbursements) of such Class, during the preceding quarter (or shorter period commencing with the Closing Date or ending with the Revolving Facility Maturity Date or the date on which the Revolving Facility Commitments of such Class shall be terminated) at the rate per annum equal to the Applicable Margin for Eurocurrency Revolving Borrowings of such Class effective for each day in such period accrued up to the last day of each March, June, September and December; provided, however, that any L/C Participation Fee otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided Cash Collateral reasonably satisfactory to any Issuing Bank pursuant to Section 2.22 shall be payable, to the maximum extent permitted by applicable Law, to the other Lenders in accordance with the upward adjustments in their respective Applicable Percentages allocable to such Letter of Credit pursuant to Section 2.23(a)(iv), with the balance of such fee, if any, payable to such Issuing Bank for its own account, and (ii) to each Issuing Bank, for its own account, (x) three Business Days after the last day of March, June, September and December of each year and three Business Days after the date on which the Revolving Facility Commitments of all the Lenders shall be terminated as provided herein, a fronting fee in respect of each Letter of Credit issued by such Issuing Bank for the period from and including the date of issuance of such Letter of Credit to and including the termination of such Letter of Credit, computed at a rate equal to 1/8 of 1% per annum of the Dollar Equivalent of the daily average stated amount of such Letter of Credit (or as otherwise agreed with such Issuing Bank), plus (y) in connection with the issuance, amendment or transfer of any such Letter of Credit or any L/C Disbursement thereunder, such Issuing Bank’s customary documentary and processing charges (collectively, “Issuing Bank Fees”).  All L/C Participation Fees and Issuing Bank Fees that are payable on a per annum basis shall be computed on the basis of the actual number of days elapsed in a year of 360 days.

 

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(c)                                  The Borrower agrees to pay to the Administrative Agent, for the account of the Administrative Agent, the “Senior Facilities Administration Fee” as set forth in the Fee Letter (the “Administrative Agent Fees”).

 

(d)                                 In the event that, on or prior to the date that is six (6) months after the Repricing Effective Date, the Borrower shall (x) make a prepayment of the Term B Loans pursuant to Section 2.11(a) with the proceeds of, or convert the Term B Loans into, any new or replacement tranche of long-term secured term loans that are broadly syndicated to banks and other institutional investors in financings similar to the Term B Loans and have an All-in Yield that is less than the All-in Yield of such Term B Loans (other than, for the avoidance of doubt, with respect to securitizations) or (y) effect any amendment to this Agreement which reduces the All-in Yield of the Term B Loans (other than, in the case of each of clauses (x) and (y), in connection with a Change in Control or a transformative acquisition referred to in the last sentence of this clause), the Borrower shall pay to the Administrative Agent, for the ratable account of each of the applicable Term B Lenders, including, for the avoidance of doubt, any Non-Consenting Lender, (A) in the case of clause (x), a prepayment premium of 1.00% of the aggregate principal amount of the Term B Loans so prepaid or converted and (B) in the case of clause (y), a fee equal to 1.00% of the aggregate principal amount of the applicable Term B Loans for which the All-in Yield has been reduced pursuant to such amendment.  Such amounts shall be due and payable on the date of such prepayment or the effective date of such amendment, as the case may be.  For purposes of this Section 2.12(d), a “transformative acquisition” is any acquisition by the Borrower or any Subsidiary that is (i) not permitted by the terms of the Loan Documents immediately prior to the consummation of such acquisition or (ii) if permitted by the terms of the Loan Documents immediately prior to the consummation of such acquisition, would not provide the Borrower and its Subsidiaries with adequate flexibility under the Loan Documents for the continuation and/or expansion of their combined operations following such consummation, as determined by the Borrower in good faith.

 

(e)                                  All Fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, if and as appropriate, among the Lenders, except that Issuing Bank Fees shall be paid directly to the applicable Issuing Banks.  Once paid, none of the Fees shall be refundable under any circumstances.

 

SECTION 2.13                                           Interest.

 

(a)                                 The Loans comprising each ABR Borrowing shall bear interest at the ABR plus the Applicable Margin.

 

(b)                                 The Loans comprising each Eurocurrency Borrowing shall bear interest at the Adjusted Eurocurrency Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin.

 

(c)                                  Notwithstanding the foregoing, if any principal of or interest on any Loan or any Fees or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2.00% plus the rate otherwise applicable to such Loan as provided in the preceding clauses of this Section 2.13 or (ii) in the case of any other overdue amount, 2.00% plus the rate applicable to ABR Loans as provided in clause (a) of this Section 2.13; provided that this clause (c) shall not apply to any Event of Default that has been waived by the Lenders pursuant to Section 9.09.

 

(d)                                 Accrued interest on each Loan shall be payable in arrears (i) on each Interest Payment Date for such Loan, (ii) in the case of Revolving Facility Loans, upon termination of the

 

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applicable Revolving Facility Commitments and (iii) in the case of the Term Loans, on the applicable Term Facility Maturity Date; provided that (A) interest accrued pursuant to clause (c) of this Section 2.13 shall be payable on demand, (B) in the event of any repayment or prepayment of any Loan (other than a prepayment of a Revolving Facility Loan that is an ABR Loan that is not made in conjunction with a permanent commitment reduction), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (C) in the event of any conversion of any Eurocurrency Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

 

(e)                                  All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the ABR at times when the ABR is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  The applicable ABR, Adjusted Eurocurrency Rate or Eurocurrency Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

 

SECTION 2.14                                           Alternate Rate of Interest.  If prior to the commencement of any Interest Period for a Eurocurrency Borrowing denominated in any currency, on any day:

 

(a)                                 the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining any applicable Adjusted Eurocurrency Rate for such currency for such Interest Period for such day; or

 

(b)                                 the Administrative Agent is advised by the Required Lenders that any applicable Adjusted Eurocurrency Rate for such currency for such Interest Period for such day will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing, for such Interest Period or such day;

 

(c)                                  then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or electronic means as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurocurrency Borrowing denominated in such currency shall be ineffective and such Borrowing shall be converted to or continued as on the last day of the Interest Period applicable thereto, an ABR Borrowing and (ii) if any Borrowing Request requests a Eurocurrency Borrowing in such currency, such Borrowing shall be made as an ABR Borrowing.

 

If at any time the Administrative Agent determines (which determination shall be conclusive absent manifest error) that (i) the circumstance set forth in Section 2.14(a) above has arisen and such circumstance is unlikely to be temporary or (ii) the circumstance set forth in Section 2.14(a) has not arisen but the supervisor for the administrator of the Eurocurrency Rate or a Governmental Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which the Eurocurrency Rate shall no longer be used for determining interest rates for loans, then the Administrative Agent and the Borrower shall endeavor to establish an alternate rate of interest to the Eurocurrency Rate that gives due consideration to the then prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time, and shall enter into an amendment to this Agreement to reflect such alternate rate of interest and such other related changes to this Agreement as may be applicable; provided that, if such alternate rate of interest shall be less than zero, such rate shall be deemed to be zero (or, in the case of Eurocurrency Borrowings comprised of Eurocurrency Term Loans, if such alternate rate of interest shall be less than 1%, such rate shall be deemed to be 1%) for the purposes of this Agreement; provided further that, if the Administrative Agent and the Borrower reasonably determine that there exists

 

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a then prevailing market convention for determining a rate of interest for syndicated loans in the U.S. as the successor to interest rates based on the Eurocurrency Rate, the Administrative Agent and the Borrower shall enter into an amendment to this Agreement to reflect such alternate rate of interest and such other related changes to this Agreement as may be applicable.  Notwithstanding anything to the contrary in Section 9.09, such amendment shall become effective without any further action or consent of any other party to this Agreement.

 

SECTION 2.15                                           Increased Costs.

 

(a)                                 If any Change in Law shall:

 

(i)                                     impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted Eurocurrency Rate) or Issuing Bank;

 

(ii)                                  subject any Lender or Issuing Bank to any Tax on or with respect to its Loans, Loan principal, Letters of Credit, Commitments, or other Obligations, or its deposits, reserves, other liabilities or capital attributable thereto (other than (A) Indemnified Taxes or Other Taxes or (B) Excluded Taxes); or

 

(iii)                               impose on any Lender or Issuing Bank or the London interbank market any other condition affecting this Agreement or Eurocurrency Loans made by such Lender or any Letter of Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurocurrency Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender or Issuing Bank, as applicable, such additional amount or amounts as will compensate such Lender or Issuing Bank, as applicable, for such additional costs incurred or reduction suffered.

 

(b)                                 If any Lender or Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Bank’s policies and the policies of such Lender’s or such Issuing Bank’s holding company with respect to capital adequacy), then from time to time the Borrower shall pay to such Lender or such Issuing Bank, as applicable, such additional amount or amounts as will compensate such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company for any such reduction suffered.

 

(c)                                  A certificate of a Lender or an Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or Issuing Bank or its holding company, as applicable, as specified in clause (a) or (b) of this Section 2.15 shall be delivered to the Borrower and shall be conclusive absent manifest error; provided that any such certificate claiming amounts described in clause (x) or (y) of the definition of “Change in Law” shall, in addition, state the basis upon which such amount has been calculated and certify that such Lender’s or Issuing Bank’s demand for payment of such costs hereunder,

 

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and such method of allocation is not inconsistent with its treatment of other borrowers which, as a credit matter, are similarly situated to the Borrower and which are subject to similar provisions.  The Borrower shall pay such Lender or Issuing Bank, as applicable, the amount shown as due on any such certificate within 10 days after receipt thereof.

 

(d)                                 Promptly after any Lender or any Issuing Bank has determined that it will make a request for increased compensation pursuant to this Section 2.15, such Lender or Issuing Bank shall notify the Borrower thereof.  Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section 2.15 shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or an Issuing Bank pursuant to this Section 2.15 for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or Issuing Bank, as applicable, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor; provided, further, that if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

 

SECTION 2.16                                           Break Funding Payments.  In the event of (a) the payment of any principal of any Eurocurrency Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow (other than due to the default of the relevant Lender), convert, continue or prepay any Eurocurrency Loan on the date specified in any notice delivered pursuant hereto or (d) the assignment of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event.  In the case of a Eurocurrency Loan, such loss, cost or expense to any Lender shall be deemed to be the amount determined by such Lender (it being understood that the deemed amount shall not exceed the actual amount) to be the excess, if any, of (i) the amount of interest that would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted Eurocurrency Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue a Eurocurrency Loan, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest that would accrue on such principal amount for such period at the interest rate that such Lender would bid were it to bid, at the commencement of such period, for deposits in the applicable currency of a comparable amount and period from other banks in the eurocurrency market.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section 2.16 shall be delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

SECTION 2.17                                           Taxes.

 

(a)                                 Any and all payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Documents shall be made free and clear of and without withholding or deduction for any Taxes, except as required by applicable Law. If a Loan Party (or any person acting on behalf of a Loan Party) shall be required by applicable Law to withhold or deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required withholdings or deductions (including deductions applicable to additional sums payable under this Section 2.17) the Administrative Agent, any Lender or any Issuing Bank, as applicable, receives an amount equal to the sum it would have received had no such withholdings or deductions been made, (ii) such Loan Party or the Administrative Agent shall make such withholdings or deductions and

 

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(iii) such Loan Party or the Administrative Agent shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable Law.

 

(b)                                 In addition, the Loan Parties shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable Law.

 

(c)                                  The Loan Parties shall jointly and severally indemnify the Administrative Agent, each Lender and each Issuing Bank, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes payable or paid by the Administrative Agent, such Lender or such Issuing Bank, as applicable, on or with respect to any payment by or on account of any obligation of such Loan Party hereunder or under any other Loan Documents (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.17) and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to such Loan Party by a Lender or an Issuing Bank, or by the Administrative Agent on its own behalf, on behalf of another Agent or on behalf of a Lender or an Issuing Bank, shall be conclusive absent manifest error.

 

(d)                                 As soon as practicable after any payment of Indemnified Taxes or Other Taxes by a Loan Party to a Governmental Authority, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(e)                                  (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax or backup withholding Tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), to the extent such Lender is legally entitled to do so, at the time or times prescribed by applicable Law, such properly completed and executed documentation prescribed by applicable Law as may reasonably be requested by such Borrower to permit such payments to be made without such withholding tax or at a reduced rate; provided that no Lender shall have any obligation under this clause (e) (other than with respect to such documentation set forth in (ii)(A), (ii)(B)(1)-(4) and (iii) below) if in the reasonable judgment of such Lender such compliance would subject such Lender to any material unreimbursed cost or expense or would otherwise be disadvantageous to such Lender in any material respect.

 

(ii)                                  Without limiting the generality of the foregoing:

 

(A)                               any Lender that is a “United States person” within the meaning of Section 7701(a)(30) of the Code shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent) executed copies of Internal Revenue Service Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax; and

 

(B)                               each Lender that is not a “United States person” within the meaning of Section 7701(a)(30) of the Code,  that is entitled under the Code or any applicable treaty to an exemption from or reduction of withholding tax with respect to payments hereunder or under any other Loan Document shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Lender becomes a Lender under this

 

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Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent, but only if such Lender is legally entitled to do so), whichever of the following is applicable:

 

(1)                                 executed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, (or any applicable successor form) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party;

 

(2)                                 executed copies of Internal Revenue Service Form W-8ECI or W-8EXP (or any applicable successor form);

 

(3)                                 executed copies of Internal Revenue Service Form W-8IMY (or any applicable successor form) and all required supporting documentation (including an applicable W-8 and the documentation set forth in clause (4) below from each beneficial owner, if applicable);

 

(4)                                 in the case of a foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate to the effect that such foreign Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code and (y) executed copies of  Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, (or any applicable successor form); or

 

(5)                                 executed copies of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in United States of America federal withholding tax together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made.

 

(iii)                               If a payment made to any Lender hereunder or under any other Loan Document would be subject to United States of America federal withholding tax imposed pursuant to FATCA if such Lender fails to comply with applicable reporting and other requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent, at the time or times prescribed by applicable Law or as reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (iii), “FATCA” shall include any amendments made to FATCA after the Closing Date

 

(iv)                              Each Lender shall promptly notify the Borrower and the Administrative Agent of any change in circumstances which would modify or render invalid any claimed exemption or reduction and agrees that if any form or certification it previously delivered expires

 

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or becomes obsolete or inaccurate in any respect, it shall update such form or certification or notify the Borrower and the Administrative Agent of its inability to do so.

 

(f)                                   If the Administrative Agent or a Lender determines, in its sole discretion, that it has received a refund of any Indemnified Taxes or Other Taxes as to which it has been indemnified by a Loan Party or with respect to which such Loan Party has paid additional amounts pursuant to this Section 2.17, it shall pay over such refund to such Loan Party (but only to the extent of indemnity payments made, or additional amounts paid, by such Loan Party under this Section 2.17 with respect to the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent or such Lender (including any Taxes imposed with respect to such refund) as is determined by the Administrative Agent or Lender in good faith and in its sole discretion, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that such Loan Party, upon the request of the Administrative Agent or such Lender, agrees to repay as soon as reasonably practicable the amount paid over to such Loan Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent or such Lender in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority.  Notwithstanding anything to the contrary, in no event will the Administrative Agent or Lender be required to pay any amount to a Loan Party pursuant to this Section 2.17(f), the payment of which would place the Administrative Agent or Lender in a less favorable net after-Tax position than it would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section shall not be construed to require the Administrative Agent or any Lender to make available its Tax returns (or any other information relating to its Taxes which it deems confidential) to the Loan Parties or any other person.

 

(g)                                  Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments, repayment and the repayment, satisfaction or discharge of all obligations under any Loan Document.

 

(h)                                 Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes or Other Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes or Other Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.04(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error.  Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this clause (h).

 

SECTION 2.18                                           Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)                                 Unless otherwise specified, the Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of L/C Disbursements, or of amounts payable under Sections 2.15, 2.16 or 2.17, or otherwise) prior to 2:00 p.m., Local Time, on the date when due, in immediately available funds, without condition or deduction for any defense,

 

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recoupment, set-off or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent to the applicable account designated to the Borrower by the Administrative Agent, except payments to be made directly to the applicable Issuing Bank as expressly provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.05 shall be made directly to the persons entitled thereto.  The Administrative Agent shall distribute any such payments received by it for the account of any other person to the appropriate recipient promptly following receipt thereof.  Unless otherwise specified, if any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments under each Loan Document of principal or interest in respect of any Loan (or of any breakage indemnity in respect of any Loan) shall be made in Dollars (or, in the case of Alternate Currency Loans or Alternate Currency Letters of Credit, in the applicable Alternate Currency); all other payments hereunder and under each other Loan Document shall be made in U.S. Dollars, except as otherwise expressly provided herein.  Any payment required to be made by the Administrative Agent hereunder shall be deemed to have been made by the time required if the Administrative Agent shall, at or before such time, have taken the necessary steps to make such payment in accordance with the regulations or operating procedures of the clearing or settlement system used by the Administrative Agent to make such payment.

 

(b)                                 If at any time insufficient funds are received by and available to the Administrative Agent from the Borrower to pay fully all amounts of principal, unreimbursed L/C Disbursements, interest and fees then due from the Borrower hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due from the Borrower hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, (ii) second, towards payment of unreimbursed L/C Disbursements then due from the Borrower hereunder, ratably among the parties entitled thereto in accordance with the amounts of unreimbursed principal and L/C Disbursements then due to such parties, and (iii) third, towards payment of principal then due from the Borrower hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties.

 

(c)                                  If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Term Loans, Revolving Facility Loans or participations in L/C Disbursements resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Term Loans, Revolving Facility Loans and participations in L/C Disbursements and accrued interest thereon under any Facility than the proportion received by any other Lender under such Facility, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Term Loans, Revolving Facility Loans and participations in L/C Disbursements of other Lenders under such Facility to the extent necessary so that the benefit of all such payments shall be shared by the Lenders under such Facility ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Term Loans, Revolving Facility Loans and participations in L/C Disbursements under such Facility; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this clause (c) shall not be construed to apply to (x) any payment made pursuant to and in accordance with the express terms of this Agreement (including, without limitation, the application of funds arising from the existence of a Defaulting Lender), (y) the application of Cash Collateral provided for in Section 2.22, or (z) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or subparticipations in L/C Disbursements to any assignee or participant.  The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing

 

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arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

 

(d)                                 Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the applicable Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the applicable Issuing Bank, as applicable, the amount due.  In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the applicable Issuing Bank, as applicable, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of (A) (1) in the case of Loans, the Federal Funds Rate, (2) in the case of any other amounts denominated in U.S. Dollars, the Federal Funds Rate, and (3) in the case of any other amount denominated in a currency other than U.S. Dollars, the rate reasonably determined by the Administrative Agent to be the cost to it of funding such amount, and (B) a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

 

(e)                                  If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the applicable conditions set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

 

(f)                                   The obligations of the Lenders hereunder to make Loans, to fund participations in Letters of Credit and to make payments pursuant to Section 9.05(d) are several and not joint.  The failure of any Lender to make any Loan, to fund any such participation or to make any payment under Section 9.05(d) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan, to purchase its participation or to make its payment under Section 9.05(d).

 

SECTION 2.19                                           Mitigation Obligations; Replacement of Lenders.

 

(a)                                 If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17 or any event that gives rise to the operation of Section 2.20, then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17 or mitigate the applicability of Section 2.20, as applicable, in the future and (ii) would not subject such Lender to any material unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender in any material respect.  The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

(b)                                 If (i) any Lender requests compensation under Section 2.15 or gives notice under Section 2.20, (ii) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, or (iii) any Lender is a Defaulting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and

 

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the Administrative Agent, require any such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent (and, if in respect of any Revolving Facility Commitment or Revolving Facility Loan and the Issuing Banks), to the extent consent would be required under Section 9.04(b) for an assignment of Loans or Commitments, as applicable, which consent, in each case, shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in L/C Disbursements, accrued interest thereon, accrued fees and all other amounts payable to it hereunder from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts), (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.15, payments required to be made pursuant to Section 2.17 or a notice given under Section 2.20, such assignment will result in a reduction in such compensation or payments, (iv) the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 9.04, and (v) such assignment does not conflict with any applicable Laws.  Nothing in this Section 2.19 shall be deemed to prejudice any rights that the Borrower may have against any Lender that is a Defaulting Lender.  No action by or consent of the removed Lender shall be necessary in connection with such assignment, which shall be immediately and automatically effective upon payment of such purchase price.  In connection with any such assignment the Borrower, Administrative Agent, such removed Lender and the replacement Lender shall otherwise comply with Section 9.04, provided that if such removed Lender does not comply with Section 9.04 within one Business Day after the Borrower’s request, compliance with Section 9.04 shall not be required to effect such assignment.

 

(c)                                  If any Lender (such Lender, a “Non-Consenting Lender”) has failed to consent to a proposed amendment, waiver, discharge or termination which pursuant to the terms of Section 9.09 requires the consent of all of the Lenders affected and with respect to which the Required Lenders shall have granted their consent, then the Borrower shall have the right (unless such Non-Consenting Lender grants such consent) at its sole expense (including with respect to the processing and recordation fee referred to in Section 9.04(b)(ii)(2)) to replace such Non-Consenting Lender by requiring such Non-Consenting Lender to (and any such Non-Consenting Lender agrees that it shall, upon the Borrower’s request) assign its Loans and its Commitments (or, at the Borrower’s option, the Loans and Commitments under the Facility that is the subject of the proposed amendment, waiver, discharge or termination) hereunder to one or more assignees reasonably acceptable to (i) the Administrative Agent (unless such assignee is a Lender, an Affiliate of a Lender or an Approved Fund) and (ii) if in respect of any Revolving Facility Commitment or Revolving Facility Loan, the Issuing Banks; provided that: (a) all Loan Obligations of the Borrower owing to such Non-Consenting Lender being replaced shall be paid in full to such Non-Consenting Lender concurrently with such assignment, (b) the replacement Lender shall purchase the foregoing by paying to such Non-Consenting Lender a price equal to the principal amount thereof plus accrued and unpaid interest thereon and the replacement Lender or, at the option of the Borrower, the Borrower shall pay any amount required by Section 2.12(d)(y), if applicable, and (c) the replacement Lender shall grant its consent with respect to the applicable proposed amendment, waiver, discharge or termination.  No action by or consent of the Non-Consenting Lender shall be necessary in connection with such assignment, which shall be immediately and automatically effective upon payment of such purchase price.  In connection with any such assignment the Borrower, Administrative Agent, such Non-Consenting Lender and the replacement Lender shall otherwise comply with Section 9.04; provided that if such Non-Consenting Lender does not comply with Section 9.04 within one Business Day after the Borrower’s request, compliance with Section 9.04 shall not be required to effect such assignment.

 

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SECTION 2.20                                           Incremental Commitments.

 

(a)                                 The Borrower may, by written notice to the Administrative Agent from time to time, request Incremental Term Loan Commitments and/or Incremental Revolving Facility Commitments, as applicable, in an amount not to exceed the Incremental Amount available at the time such Incremental Commitments are established (or, solely in connection with clause (ii) of the definition of the term “Incremental Amount,” at the time any commitment relating thereto is entered into or, at the option of the Borrower, at the time of incurrence of the Incremental Loans thereunder) from one or more Incremental Term Lenders and/or Incremental Revolving Facility Lenders (which may include any existing Lender) willing to provide such Incremental Term Loans and/or Incremental Revolving Facility Commitments, as the case may be, in their own discretion; provided that each Incremental Revolving Facility Lender providing a commitment to make revolving loans shall be subject to the approval of the Administrative Agent and, to the extent the same would be required for an assignment under Section 9.04, the Issuing Banks (which approvals shall not be unreasonably withheld) unless such Incremental Revolving Facility Lender is a Revolving Facility Lender.  Such notice shall set forth (i) the amount of the Incremental Term Loan Commitments and/or Incremental Revolving Facility Commitments being requested (which shall be in minimum increments of $5,000,000 and a minimum amount of $10,000,000, or equal to the remaining Incremental Amount or, in each case, such lesser amount approved by the Administrative Agent), (ii) the date on which such Incremental Term Loan Commitments and/or Incremental Revolving Facility Commitments are requested to become effective, (iii) in the case of Incremental Revolving Facility Commitments, whether such Incremental Revolving Facility Commitments are to be (x) commitments to make additional Revolving Facility Loans on the same terms as the Initial Revolving Facility Loans or (y) commitments to make revolving loans with pricing terms, final maturity dates, participation in mandatory prepayments or commitment reductions and/or other terms different from the Initial Revolving Facility Loans (“Other Revolving Facility Loans”) and (iv) in the case of Incremental Term Loan Commitments, whether such Incremental Term Loan Commitments are to be (x) commitments to make term loans with terms identical to Term B Loans or (y) commitments to make term loans with pricing, maturity, amortization, participation in mandatory prepayments and/or other terms different from the Term B Loans (“Other Term Loans”).

 

(b)                                 The Borrower and each Incremental Term Lender and/or Incremental Revolving Facility Lender shall execute and deliver to the Administrative Agent an Incremental Assumption Agreement and such other documentation as the Administrative Agent shall reasonably specify to evidence the Incremental Term Loan Commitment of such Incremental Term Lender and/or Incremental Revolving Facility Commitment of such Incremental Revolving Facility Lender.  Each Incremental Assumption Agreement shall specify the terms of the applicable Incremental Term Loans and/or Incremental Revolving Facility Commitments; provided that:

 

(i)                                     any commitments to make additional Term B Loans and/or additional Initial Revolving Facility Loans shall have the same terms as the Term B Loans or Initial Revolving Facility Loans, respectively,

 

(ii)                                  the Other Term Loans incurred pursuant to clause (a) of this Section 2.20 shall rank pari passu or, at the option of the Borrower, junior in right of security with the Term B Loans (provided that if such Other Term Loans rank junior in right of security with the Term B Loans, such Other Term Loans will be established as a separate facility from the then existing Term Loans, shall be subject to a Permitted Junior Intercreditor Agreement and, for the avoidance of doubt, shall not be subject to clause (vii) below),

 

(iii)                               the final maturity date of any such Other Term Loans shall be no earlier than the Term B Facility Maturity Date and, except as to pricing, amortization, final maturity

 

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date, participation in mandatory prepayments and ranking as to security (which shall, subject to the other clauses of this proviso, be determined by the Borrower and the Incremental Term Lenders in their sole discretion), shall have (x) substantially similar terms as the Term B Loans or (y)  such other terms (including as to guarantees and collateral) as shall be reasonably satisfactory to the Administrative Agent,

 

(iv)                              the Weighted Average Life to Maturity of any such Other Term Loans shall be no shorter than the remaining Weighted Average Life to Maturity of the Term B Loans,

 

(v)                                 the Other Revolving Facility Loans incurred pursuant to clause (a) of this Section 2.20 shall rank pari passu or, at the option of the Borrower, junior in right of security with the Initial Revolving Facility Loans (provided that if such Other Revolving Facility Loans rank junior in right of security with the Initial Revolving Facility Loans, such Other Revolving Facility Loans will be established as a separate facility from the then existing Revolving Facility Loans, and shall be subject to a Permitted Junior Intercreditor Agreement),

 

(vi)                              the final maturity date of any such Other Revolving Facility Loans shall be no earlier than the Revolving Facility Maturity Date with respect to the Initial Revolving Facility Loans, there shall be no amortization and, except as to pricing, final maturity date, participation in mandatory prepayments and commitment reductions and ranking as to security (which shall, subject to the other clauses of this proviso, be determined by the Borrower and the Incremental Revolving Facility Lenders in their sole discretion), shall have (x) substantially similar terms as the Initial Revolving Facility Loans or (y) such other terms (including as to guarantees and collateral) as shall be reasonably satisfactory to the Administrative Agent,

 

(vii)                           with respect to any Other Term Loan incurred pursuant to clause (a) of this Section 2.20 that ranks pari passu in right of security with the Term B Loans, the All-in Yield shall be the same as that applicable to the Term B Loans on the Repricing Effective Date, except that the All-in Yield in respect of any such Other Term Loan may exceed the All-in Yield in respect of such Term B Loans on the Repricing Effective Date by no more than 0.50%, or if it does so exceed such All-in Yield by more than 0.50% (such difference, the “Term Yield Differential”) then the Applicable Margin (or the “LIBOR floor” as provided in the following proviso) applicable to such Term B Loans shall be increased such that after giving effect to such increase, the Term Yield Differential shall not exceed 0.50%; provided that, to the extent any portion of the Term Yield Differential is attributable to a higher “LIBOR floor” being applicable to such Other Term Loans, such floor shall only be included in the calculation of the Term Yield Differential to the extent such floor is greater than the Adjusted Eurocurrency Rate in effect for an Interest Period of three months’ duration at such time, and, with respect to such excess, the “LIBOR floor” applicable to the outstanding Term B Loans shall be increased to an amount not to exceed the “LIBOR floor” applicable to such Other Term Loans prior to any increase in the Applicable Margin applicable to such Term B Loans then outstanding,

 

(viii)                        (A) such Other Revolving Facility Loans may participate on a pro rata basis or a less than pro rata basis (but not a greater than pro rata basis) than the Initial Revolving Facility Loans in (x) any voluntary or mandatory prepayment or commitment reduction hereunder and (y) any Borrowing at the time such Borrowing is made and (B) such Other Term Loans may participate on a pro rata basis or a less than pro rata basis (but not a greater than pro rata basis) than the Term B Loans in any mandatory prepayment hereunder; and

 

(ix)                              there shall be no obligor in respect of any Incremental Loans that is not a Loan Party, and, if such Incremental Loans are secured, shall only be secured by Collateral.

 

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Each party hereto hereby agrees that, upon the effectiveness of any Incremental Assumption Agreement, this Agreement shall be amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Incremental Term Loan Commitments and/or Incremental Revolving Facility Commitments evidenced thereby as provided for in Section 9.09(e).  Any amendment to this Agreement or any other Loan Document that is necessary to effect the provisions of this Section 2.20 and any such collateral and other documentation shall be deemed “Loan Documents” hereunder and may be memorialized in writing by the Administrative Agent with the Borrower’s consent (not to be unreasonably withheld) and furnished to the other parties hereto.

 

(c)                                  Notwithstanding the foregoing, no Incremental Term Loan Commitment or Incremental Revolving Facility Commitment shall become effective under this Section 2.20 unless (i) on the date of such effectiveness, (A) to the extent required by the relevant Incremental Assumption Agreement, the conditions set forth in clause (c) of Section 4.01 shall be satisfied and the Administrative Agent shall have received a certificate to that effect dated such date and executed by a Responsible Officer of the Borrower and (B) if such Incremental Term Loan Commitment or Incremental Revolving Facility Commitment is established for a purpose other than financing any Permitted Business Acquisition or any other acquisition that is permitted by this Agreement, no Event of Default with respect to the Borrower under Sections 7.01(b), (h) or (i) shall have occurred and be continuing and (ii) the Administrative Agent shall have received customary legal opinions, board resolutions and other customary closing certificates and documentation as required by the relevant Incremental Assumption Agreement and, to the extent required by the Administrative Agent, consistent with those delivered on the Closing Date under Section 4.02 of the Original Credit Agreement and such additional customary documents and filings (including amendments to the Mortgages and other Security Documents and title endorsement bringdowns) as the Administrative Agent may reasonably request to assure that the Incremental Term Loans and/or Revolving Facility Loans in respect of Incremental Revolving Facility Commitments are secured by the Collateral ratably with (or, to the extent set forth in the applicable Incremental Assumption Agreement, junior to) one or more Classes of then-existing Term Loans and Revolving Facility Loans.

 

(d)                                 Each of the parties hereto hereby agrees that the Administrative Agent may take any and all action as may be reasonably necessary to ensure that (i) all Incremental Term Loans (other than Other Term Loans of a different Class), when originally made, are included in each Borrowing of the outstanding applicable Class of Term Loans on a pro rata basis, and (ii) all Revolving Facility Loans in respect of Incremental Revolving Facility Commitments (other than Revolving Facility Loans of a different Class), when originally made, are included in each Borrowing of the applicable Class of outstanding Revolving Facility Loans on a pro rata basis.  The Borrower agrees that Section 2.16 shall apply to any conversion of Eurocurrency Loans to ABR Loans reasonably required by the Administrative Agent to effect the foregoing.

 

(e)                                  Notwithstanding anything to the contrary in this Agreement, including Section 2.18(c) (which provisions shall not be applicable to clauses (e) through (i) of this Section 2.20), pursuant to one or more offers made from time to time by the Borrower to all Lenders of any Class of Term Loans and/or Revolving Facility Commitments, on a pro rata basis (based, in the case of an offer to the Lenders under any Class of Term Loans, on the aggregate outstanding Term Loans of such Class and, in the case of an offer to the Lenders under any Revolving Facility, on the aggregate outstanding Revolving Facility Commitments under such Revolving Facility, as applicable) and on the same terms (“Pro Rata Extension Offers”), the Borrower is hereby permitted to consummate transactions with individual Lenders from time to time to extend the maturity date of such Lender’s Loans and/or Commitments of such Class and to otherwise modify the terms of such Lender’s Loans and/or Commitments of such Class pursuant to the terms of the relevant Pro Rata Extension Offer (including, without limitation, increasing the interest rate or fees payable in respect of such Lender’s Loans and/or

 

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Commitments and/or modifying the scheduled amortization in respect of such Lender’s Loans).  For the avoidance of doubt, the reference to “on the same terms” in the preceding sentence shall mean, (i) in the case of an offer to the Lenders under any Class of Term Loans, that all of the Term Loans of such Class are offered to be extended for the same amount of time and that the interest rate changes and fees payable with respect to such extension are the same and (ii) in the case of an offer to the Lenders under any Revolving Facility, that all of the Revolving Facility Commitments of such Facility are offered to be extended for the same amount of time and that the interest rate changes and fees payable with respect to such extension are the same.  Any such extension (an “Extension”) agreed to between the Borrower and any such Lender (an “Extending Lender”) will be established under this Agreement by implementing an Incremental Term Loan for such Lender if such Lender is extending an existing Term Loan (such extended Term Loan, an “Extended Term Loan”) or an Incremental Revolving Facility Commitment for such Lender if such Lender is extending an existing Revolving Facility Commitment (such extended Revolving Facility Commitment, an “Extended Revolving Facility Commitment” and any Revolving Facility Loans made thereunder, “Extended Revolving Loans”).  Each Pro Rata Extension Offer shall specify the date on which the Borrower proposes that the Extended Term Loan shall be made or the Extended Revolving Facility Commitment shall become effective, which shall be a date not earlier than five Business Days after the date on which notice is delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion).

 

(f)                                   The Borrower and each Extending Lender shall execute and deliver to the Administrative Agent an Incremental Assumption Agreement and such other documentation as the Administrative Agent shall reasonably specify to evidence the Extended Term Loans and/or Extended Revolving Facility Commitments of such Extending Lender.  Each Incremental Assumption Agreement shall specify the terms of the applicable Extended Term Loans and/or Extended Revolving Facility Commitments; provided that (i) except as to interest rates, fees and any other pricing terms (which interest rates, fees and other pricing terms shall not be subject to the provisions set forth in Section 2.20(b)(vii)), and amortization, final maturity date and participation in prepayments and commitment reductions (which shall, subject to clauses (ii) and (iii) of this proviso, be determined by the Borrower and set forth in the Pro Rata Extension Offer), the Extended Term Loans shall have (x) the same terms as an existing Class of Term Loans or (y) such other terms as shall be reasonably satisfactory to the Administrative Agent, (ii) the final maturity date of any Extended Term Loans shall be no earlier than the latest Term Facility Maturity Date in effect on the date of incurrence, (iii) the Weighted Average Life to Maturity of any Extended Term Loans shall be no shorter than the remaining Weighted Average Life to Maturity of the Class of Term Loans to which such offer relates, (iv) except as to interest rates, fees, any other pricing terms, participation in mandatory prepayments and commitment reductions and final maturity (which shall be determined by the Borrower and set forth in the Pro Rata Extension Offer), any Extended Revolving Facility Commitment shall have (x) the same terms as an existing Class of Revolving Facility Commitments or (y) have such other terms as shall be reasonably satisfactory to the Administrative Agent and, in respect of any other terms that would affect the rights or duties of any Issuing Bank, such terms as shall be reasonably satisfactory to such Issuing Bank, (v) any Extended Revolving Facility Commitments may participate on a pro rata basis or a less than pro rata basis (but not greater than a pro rata basis) than the Initial Revolving Facility Loans in any voluntary or mandatory prepayment or commitment reduction hereunder and (vi) any Extended Term Loans may participate on a pro rata basis or a less than pro rata basis (but not a greater than pro rata basis) than the Term B Loans in any mandatory prepayment hereunder.  Upon the effectiveness of any Incremental Assumption Agreement, this Agreement shall be amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Extended Term Loans and/or Extended Revolving Facility Commitments evidenced thereby as provided for in Section 9.09(e).  Any such deemed amendment may be memorialized in writing by the Administrative Agent with the Borrower’s consent (not to be unreasonably withheld) and furnished to the other parties hereto.  If provided in any Incremental Assumption Agreement with respect to any Extended Revolving Facility Commitments, and with the

 

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consent of each Issuing Bank, participations in Letters of Credit shall be reallocated to lenders holding such Extended Revolving Facility Commitments in the manner specified in such Incremental Assumption Agreement, including upon effectiveness of such Extended Revolving Facility Commitment or upon or prior to the maturity date for any Class of Revolving Facility Commitments.

 

(g)                                  Upon the effectiveness of any such Extension, the applicable Extending Lender’s Term Loan will be automatically designated an Extended Term Loan and/or such Extending Lender’s Revolving Facility Commitment will be automatically designated an Extended Revolving Facility Commitment.  For purposes of this Agreement and the other Loan Documents, (i) if such Extending Lender is extending a Term Loan, such Extending Lender will be deemed to have an Incremental Term Loan having the terms of such Extended Term Loan and (ii) if such Extending Lender is extending a Revolving Facility Commitment, such Extending Lender will be deemed to have an Incremental Revolving Facility Commitment having the terms of such Extended Revolving Facility Commitment.

 

(h)                                 Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including, without limitation, this Section 2.20), (i) the aggregate amount of Extended Term Loans and Extended Revolving Facility Commitments will not be included in the calculation of the Incremental Amount, (ii) no Extended Term Loan or Extended Revolving Facility Commitment is required to be in any minimum amount or any minimum increment, (iii) any Extending Lender may extend all or any portion of its Term Loans and/or Revolving Facility Commitment pursuant to one or more Pro Rata Extension Offers (subject to applicable proration in the case of over participation) (including the extension of any Extended Term Loan and/or Extended Revolving Facility Commitment), (iv) there shall be no condition to any Extension of any Loan or Commitment at any time or from time to time other than notice to the Administrative Agent of such Extension and the terms of the Extended Term Loan or Extended Revolving Facility Commitment implemented thereby, (v) all Extended Term Loans, Extended Revolving Facility Commitments and all obligations in respect thereof shall be Loan Obligations of the relevant Loan Parties under this Agreement and the other Loan Documents that are secured by the Collateral on a pari passu basis with all other Obligations relating to an existing Class of Term Loans of the relevant Loan Parties under this Agreement and the other Loan Documents being extended thereby, (vi) no Issuing Bank shall be obligated to issue Letters of Credit under such Extended Revolving Facility Commitments unless it shall have consented thereto and (vii) there shall be no obligor in respect of any such Extended Term Loans or Extended Revolving Facility Commitments that is not a Loan Party.

 

(i)                                     Each Extension shall be consummated pursuant to procedures set forth in the associated Pro Rata Extension Offer; provided that the Borrower shall cooperate with the Administrative Agent prior to making any Pro Rata Extension Offer to establish reasonable procedures with respect to mechanical provisions relating to such Extension, including, without limitation, timing, rounding and other adjustments.

 

(j)                                    Notwithstanding anything to the contrary in this Agreement, including Section 2.18(c) (which provisions shall not be applicable to clauses (j) through (o) of this Section 2.20), the Borrower may by written notice to the Administrative Agent establish one or more additional tranches of term loans under this Agreement (such loans, “Refinancing Term Loans”), the net cash proceeds of which are used to Refinance in whole or in part any Class of Term Loans.  Each such notice shall specify the date (each, a “Refinancing Effective Date”) on which the Borrower proposes that the Refinancing Term Loans shall be made, which shall be a date not earlier than five Business Days after the date on which such notice is delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion); provided that:

 

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(i)                                     before and after giving effect to the borrowing of such Refinancing Term Loans on the Refinancing Effective Date each of the conditions set forth in Section 4.01 shall be satisfied to the extent required by the relevant Incremental Assumption Agreement governing such Refinancing Term Loans;

 

(ii)                                  the final maturity date of the Refinancing Term Loans shall be no earlier than the Term Facility Maturity Date of the refinanced Term Loans,

 

(iii)                               the Weighted Average Life to Maturity of such Refinancing Term Loans shall be no shorter than the then-remaining Weighted Average Life to Maturity of the refinanced Term Loans;

 

(iv)                              the aggregate principal amount of the Refinancing Term Loans shall not exceed the outstanding principal amount of the refinanced Term Loans plus amounts used to pay fees, premiums, costs and expenses (including original issue discount) and accrued interest associated therewith;

 

(v)                                 all other terms applicable to such Refinancing Term Loans (other than provisions relating to original issue discount, upfront fees, interest rates and any other pricing terms (which original issue discount, upfront fees, interest rates and other pricing terms shall not be subject to the provisions set forth in Section 2.20(b)(vii)) and optional prepayment or mandatory prepayment or redemption terms, which shall be as agreed between the Borrower and the Lenders providing such Refinancing Term Loans) taken as a whole shall be substantially similar to, or not materially less favorable to the Borrower and its Subsidiaries than, the terms, taken as a whole, applicable to the Term B Loans (except to the extent such covenants and other terms apply solely to any period after the Term B Facility Maturity Date or are otherwise reasonably acceptable to the Administrative Agent), as determined by the Borrower in good faith.  In addition, notwithstanding the foregoing, the Borrower may establish Refinancing Term Loans to refinance and/or replace all or any portion of a Revolving Facility Commitment (regardless of whether Revolving Facility Loans are outstanding under such Revolving Facility Commitments at the time of incurrence of such Refinancing Term Loans), so long as (1) the aggregate amount of such Refinancing Term Loans does not exceed the aggregate amount of Revolving Facility Commitments terminated at the time of incurrence thereof, (2) if the Revolving Facility Exposure outstanding on the Refinancing Effective Date would exceed the aggregate amount of Revolving Facility Commitments outstanding in each case after giving effect to the termination of such Revolving Facility Commitments, the Borrower shall take one or more actions such that such Revolving Facility Exposure does not exceed such aggregate amount of Revolving Facility Commitments in effect on the Refinancing Effective Date after giving effect to the termination of such Revolving Facility Commitments (it being understood that (x) such Refinancing Term Loans may be provided by the Lenders holding the Revolving Facility Commitments being terminated and/or by any other person that would be a permitted Assignee hereunder and (y) the proceeds of such Refinancing Term Loans shall not constitute Net Proceeds hereunder), (3) the Weighted Average Life to Maturity of the Refinancing Term Loans shall be no shorter than the remaining life to termination of the terminated Revolving Facility Commitments, (4) the final maturity date of the Refinancing Term Loans shall be no earlier than the termination date of the terminated Revolving Facility Commitments and (5) all other terms applicable to such Refinancing Term Loans (other than provisions relating to original issue discount, upfront fees, interest rates and any other pricing terms (which original issue discount, upfront fees, interest rates and other pricing terms shall not be subject to the provisions set forth in Section 2.20(b)(vii)) and optional prepayment or mandatory prepayment or redemption terms, which shall be as agreed between the Borrower and the Lenders providing such Refinancing Term Loans) taken as a whole shall be

 

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substantially similar to, or not materially less favorable to the Borrower and its Subsidiaries than, the terms, taken as a whole, applicable to the Term B Loans (except to the extent such covenants and other terms apply solely to any period after the Term B Facility Maturity Date or are otherwise reasonably acceptable to the Administrative Agent), as determined by the Borrower in good faith;

 

(vi)                              with respect to Refinancing Term Loans secured by Liens on the Collateral that rank junior in right of security to the Term B Loans, such Liens will be subject to a Permitted Junior Intercreditor Agreement; and

 

(vii)                           there shall be no obligor in respect of such Refinancing Term Loans that is not a Loan Party.

 

(k)                                 The Borrower may approach any Lender or any other person that would be a permitted Assignee pursuant to Section 9.04 to provide all or a portion of the Refinancing Term Loans; provided that any Lender offered or approached to provide all or a portion of the Refinancing Term Loans may elect or decline, in its sole discretion, to provide a Refinancing Term Loan.  Any Refinancing Term Loans made on any Refinancing Effective Date shall be designated an additional Class of Term Loans for all purposes of this Agreement; provided, further, that any Refinancing Term Loans may, to the extent provided in the applicable Incremental Assumption Agreement governing such Refinancing Term Loans, be designated as an increase in any previously established Class of Term Loans made to the Borrower.

 

(l)                                     Notwithstanding anything to the contrary in this Agreement, including Section 2.18(c) (which provisions shall not be applicable to clauses (l) through (o) of this Section 2.20), the Borrower may by written notice to the Administrative Agent establish one or more additional Facilities providing for revolving commitments (“Replacement Revolving Facilities” and the commitments thereunder, “Replacement Revolving Facility Commitments” and the revolving loans thereunder, “Replacement Revolving Loans”), which replace in whole or in part any Class of Revolving Facility Commitments under this Agreement.  Each such notice shall specify the date (each, a “Replacement Revolving Facility Effective Date”) on which the Borrower proposes that the Replacement Revolving Facility Commitments shall become effective, which shall be a date not less than five Business Days after the date on which such notice is delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion); provided that: (i) before and after giving effect to the establishment of such Replacement Revolving Facility Commitments on the Replacement Revolving Facility Effective Date, each of the conditions set forth in Section 4.01 shall be satisfied to the extent required by the relevant Incremental Assumption Agreement governing such Replacement Revolving Facility Commitments; (ii) after giving effect to the establishment of any Replacement Revolving Facility Commitments and any concurrent reduction in the aggregate amount of any other Revolving Facility Commitments, the aggregate amount of Revolving Facility Commitments shall not exceed the aggregate amount of the Revolving Facility Commitments outstanding immediately prior to the applicable Replacement Revolving Facility Effective Date; (iii) no Replacement Revolving Facility Commitments shall have a final maturity date (or require commitment reductions or amortizations) prior to the Revolving Facility Maturity Date in effect at the time of incurrence for the Revolving Facility Commitments being replaced; (iv) all other terms applicable to such Replacement Revolving Facility (other than provisions relating to (x) fees, interest rates and other pricing terms and prepayment and commitment reduction and optional redemption terms which shall be as agreed between the Borrower and the Lenders providing such Replacement Revolving Facility Commitments and (y) the amount of any letter of credit sublimit under such Replacement Revolving Facility, which shall be as agreed between the Borrower, the Lenders providing such Replacement Revolving Facility Commitments, the Administrative Agent and the replacement issuing bank under such Replacement Revolving Facility Commitments) taken as a whole shall be substantially similar to, or not materially less

 

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favorable to the Borrower and its Subsidiaries than, the terms, taken as a whole, applicable to the Initial Revolving Facility Loans (except to the extent such covenants and other terms apply solely to any period after the latest Revolving Facility Maturity Date in effect at the time of incurrence or are otherwise reasonably acceptable to the Administrative Agent); and (v) there shall be no obligor in respect of such Replacement Revolving Facility that is not a Loan Party.  In addition, the Borrower may establish Replacement Revolving Facility Commitments to refinance and/or replace all or any portion of a Term Loan hereunder (regardless of whether such Term Loan is repaid with the proceeds of Replacement Revolving Loans or otherwise), so long as the aggregate amount of such Replacement Revolving Facility Commitments does not exceed the aggregate amount of Term Loans repaid at the time of establishment thereof (it being understood that such Replacement Revolving Facility Commitment may be provided by the Lenders holding the Term Loans being repaid and/or by any other person that would be a permitted Assignee hereunder) so long as (i) before and after giving effect to the establishment such Replacement Revolving Facility Commitments on the Replacement Revolving Facility Effective Date each of the conditions set forth in Section 4.01 shall be satisfied to the extent required by the relevant agreement governing such Replacement Revolving Facility Commitments, (ii) the remaining life to termination of such Replacement Revolving Facility Commitments shall be no shorter than the Weighted Average Life to Maturity then applicable to the refinanced Term Loans, (iii) the final termination date of the Replacement Revolving Facility Commitments shall be no earlier than the Term Facility Maturity Date of the refinanced Term Loans, (iv) with respect to Replacement Revolving Loans secured by Liens on Collateral that rank junior in right of security to the Initial Revolving Facility Loans, such Liens will be subject to a Permitted Junior Intercreditor Agreement and (v) the requirement of clause (v) in the preceding sentence shall be satisfied mutatis mutandis.  Solely to the extent that an Issuing Bank is not a replacement issuing bank under a Replacement Revolving Facility, it is understood and agreed that such Issuing Bank shall not be required to issue any letters of credit under such Replacement Revolving Facility and, to the extent it is necessary for such Issuing Bank to withdraw as an Issuing Bank at the time of the establishment of such Replacement Revolving Facility, such withdrawal shall be on terms and conditions reasonably satisfactory to such Issuing Bank in its sole discretion.  The Borrower agrees to reimburse each Issuing Bank, in full upon demand, for any reasonable and documented out-of-pocket cost or expense attributable to such withdrawal.

 

(m)                             The Borrower may approach any Lender or any other person that would be a permitted Assignee of a Revolving Facility Commitment pursuant to Section 9.04 to provide all or a portion of the Replacement Revolving Facility Commitments; provided that any Lender offered or approached to provide all or a portion of the Replacement Revolving Facility Commitments may elect or decline, in its sole discretion, to provide a Replacement Revolving Facility Commitment.  Any Replacement Revolving Facility Commitment made on any Replacement Revolving Facility Effective Date shall be designated an additional Class of Revolving Facility Commitments for all purposes of this Agreement; provided that any Replacement Revolving Facility Commitments may, to the extent provided in the applicable Incremental Assumption Agreement, be designated as an increase in any previously established Class of Revolving Facility Commitments.

 

(n)                                 On any Replacement Revolving Facility Effective Date, subject to the satisfaction of the foregoing terms and conditions, each of the Lenders with Replacement Revolving Facility Commitments of such Class shall purchase from each of the other Lenders with Replacement Revolving Facility Commitments of such Class, at the principal amount thereof and in the applicable currencies, such interests in the Replacement Revolving Loans and participations in Letters of Credit under such Replacement Revolving Facility Commitments of such Class then outstanding on such Replacement Revolving Facility Effective Date as shall be necessary in order that, after giving effect to all such assignments and purchases, the Replacement Revolving Loans and participations of such Replacement Revolving Facility Commitments of such Class will be held by the Lenders thereunder ratably in accordance with their Replacement Revolving Facility Commitments.

 

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(o)                                 For purposes of this Agreement and the other Loan Documents, (i) if a Lender is providing a Refinancing Term Loan, such Lender will be deemed to have an Incremental Term Loan having the terms of such Refinancing Term Loan and (ii) if a Lender is providing a Replacement Revolving Facility Commitment, such Lender will be deemed to have an Incremental Revolving Facility Commitment having the terms of such Replacement Revolving Facility Commitment.  Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including, without limitation, this Section 2.20), (i) the aggregate amount of Refinancing Term Loans and Replacement Revolving Facility Commitments will not be included in the calculation of the Incremental Amount, (ii) no Refinancing Term Loan or Replacement Revolving Facility Commitment is required to be in any minimum amount or any minimum increment, (iii) there shall be no condition to any incurrence of any Refinancing Term Loan or Replacement Revolving Facility Commitment at any time or from time to time other than those set forth in clauses (j) or (l) above, as applicable, and (iv) all Refinancing Term Loans, Replacement Revolving Facility Commitments and all obligations in respect thereof shall be Obligations under this Agreement and the other Loan Documents that are secured by the Collateral on a pari passu basis with all other Obligations under this Agreement and the other Loan Documents.

 

(p)                                 Notwithstanding anything in the foregoing to the contrary, (i) for the purpose of determining the number of outstanding Eurocurrency Borrowings upon the incurrence of any Incremental Loans, (x) to the extent the last date of Interest Periods for multiple Eurocurrency Borrowings under the Term Facilities fall on the same day, such Eurocurrency Borrowings shall be considered a single Eurocurrency Borrowing and (y) to the extent the last date of Interest Periods for multiple Eurocurrency Borrowings under the Revolving Facilities fall on the same day, such Eurocurrency Borrowings shall be considered a single Eurocurrency Borrowing and (ii) the initial Interest Period with respect to any Eurocurrency Borrowing of Incremental Loans may, at the Borrower’s option, be of a duration of a number of Business Days that is less than one month, and the Adjusted Eurocurrency Rate with respect to such initial Interest Period shall be the same as the Adjusted Eurocurrency Rate applicable to any then-outstanding Eurocurrency Borrowing as the Borrower may direct, so long as the last day of such initial Interest Period is the same as the last day of the Interest Period with respect to such outstanding Eurocurrency Borrowing.

 

SECTION 2.21                                           Illegality.  If any Lender reasonably determines that any change in law has made it unlawful, or that any Governmental Authority has asserted after the Closing Date that it is unlawful, for any Lender or its applicable Lending Office to make or maintain any Eurocurrency Loans, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, any obligations of such Lender to make or continue Eurocurrency Loans or to convert ABR Borrowings to Eurocurrency Borrowings shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist.  Upon receipt of such notice, the Borrower shall upon demand from such Lender (with a copy to the Administrative Agent), either convert all Eurocurrency Borrowings of such Lender to ABR Borrowings, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency Borrowings to such day, or immediately, if such Lender may not lawfully continue to maintain such Loans.  Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.

 

SECTION 2.22                                           Cash Collateral.

 

(a)                                 Certain Credit Support Events.  Upon the request of the Administrative Agent or any Issuing Bank if, as of the expiration date for all Letters of Credit set forth in Section 2.05(c), any L/C Exposure for any reason remains outstanding, the Borrower shall, in each case, immediately Cash Collateralize the then outstanding amount of all L/C Exposure.

 

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(b)                                 Grant of Security Interest.  All Cash Collateral (other than credit support not constituting funds subject to deposit) shall be maintained in blocked, non-interest bearing deposit accounts at the Administrative Agent.  The Borrower, and to the extent provided by any Lender, such Lender, hereby grants to (and subjects to the control of) the Collateral Agent, for the benefit of the Administrative Agent, the applicable Issuing Bank and the Lenders, and agrees to maintain, a first priority security interest in all such cash, deposit accounts and all balances therein, and all other property so provided as collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied pursuant to Section 2.22(c).  If at any time the Administrative Agent or the Collateral Agent determines that Cash Collateral is subject to any right or claim of any person other than the Collateral Agent as herein provided, or that the total amount of such Cash Collateral is less than the applicable Fronting Exposure and other obligations secured thereby, then (i) the Borrower (solely to the extent that the applicable Cash Collateral was provided by the Borrower), or (ii) the relevant Defaulting Lender (solely to the extent that the applicable Cash Collateral was provided by such Defaulting Lender) will, promptly upon demand by the Administrative Agent, pay or provide to the Collateral Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency.

 

(c)                                  Application.  Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under any of this Section 2.22 or Sections 2.05, 2.11, 2.23 or 7.01 in respect of Letters of Credit shall be held and applied to the satisfaction of the specific Letter of Credit obligations, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such property as may be provided for herein.

 

(d)                                 Release.  Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or other obligations shall be released promptly following (i) the elimination of the applicable Fronting Exposure or other obligations giving rise thereto (including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 9.04(b)(ii))) or (ii) the Administrative Agent’s good faith determination that there exists excess Cash Collateral; provided, however, (x) that Cash Collateral furnished by or on behalf of a Loan Party shall not be released during the continuance of a Default or Event of Default (and following application as provided in this Section 2.22 may be otherwise applied in accordance with Section 7.01), and (y) the person providing Cash Collateral and the applicable Issuing Bank may agree that Cash Collateral shall not be released but instead held to support future anticipated Fronting Exposure or other obligations.

 

SECTION 2.23                                           Defaulting Lenders.

 

(a)                                 Adjustments.  Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

 

(i)                                     Waivers and Amendments.  That Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in Section 9.09.

 

(ii)                                  Reallocation of Payments.  Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise, and including any amounts made available to the Administrative Agent by that Defaulting Lender pursuant to Section 9.06), shall be applied at such time or times as may be determined by the Administrative

 

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Agent as follows:  first, to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by that Defaulting Lender to the Issuing Banks hereunder; third, to Cash Collateralize the Issuing Banks’ Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.22; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released in order to (x) satisfy obligations of that Defaulting Lender to fund Loans under this Agreement and (y) Cash Collateralize the Issuing Banks’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.22; sixth, to the payment of any amounts owing to the Lenders or the Issuing Banks as a result of any judgment of a court of competent jurisdiction obtained by any Lender or Issuing Bank against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to that Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Loans or L/C Borrowings were made at a time when the conditions set forth in Section 4.01 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Borrowings owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Borrowings to, that Defaulting Lender.  Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.23(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto.

 

(iii)                               Certain Fees.  The Defaulting Lender (x) shall not be entitled to receive any Commitment Fee pursuant to Section 2.12(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender), and (y) shall be limited in its right to receive L/C Participation Fees as provided in Section 2.12(b).

 

(iv)                        Reallocation of Applicable Percentages to Reduce Fronting Exposure.  All or any part of such Defaulting Lender’s participation in L/C Commitments shall be reallocated along the non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the aggregate Revolving Facility Exposure of any non-Defaulting Lender to exceed such non-Defaulting Lender’s Revolving Facility Commitment.   Subject to Section 9.27, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a non-Defaulting Lender as a result of such non-Defaulting Lender’s increased exposure following such reallocation.

 

(b)                                 Defaulting Lender Cure.  If the Borrower, the Administrative Agent and the Issuing Banks agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may

 

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include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages (without giving effect to Section 2.23(a)(iv)), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

ARTICLE III
 REPRESENTATIONS AND WARRANTIES

 

On the date of each Credit Event, the Borrower represents and warrants that:

 

SECTION 3.01                                           Organization; Powers.  Except as set forth on Schedule 3.01 to the Original Credit Agreement, each of Holdings, the Borrower and each of the Material Subsidiaries (limited in the case of clause (d) below, to Holdings, the Borrower and each of the Subsidiary Loan Parties) (a) is a limited liability company, unlimited liability company, corporation or partnership duly organized, validly existing and in good standing (or, if applicable in a foreign jurisdiction, enjoys the equivalent status under the laws of any jurisdiction of organization outside the United States of America) under the laws of the jurisdiction of its organization, (b) has all requisite power and authority to own its property and assets and to carry on its business as now conducted, (c) is qualified to do business in each jurisdiction where such qualification is required, except where the failure so to qualify could not reasonably be expected to have a Material Adverse Effect, and (d) has the power and authority to execute, deliver and perform its obligations under each of the Loan Documents and each other agreement or instrument contemplated thereby to which it is or will be a party and, in the case of the Borrower, to borrow and otherwise obtain credit hereunder.

 

SECTION 3.02                                           Authorization.  The execution, delivery and performance by the Borrower, each of the Subsidiary Loan Parties and, in the case of Sections 3.02(a) and 3.02(b)(i)(A) and (B), Holdings, of each of the Loan Documents to which it is a party and the borrowings hereunder (a) have been duly authorized by all corporate, stockholder, limited liability company, partnership or other organizational action required to be obtained by Holdings, the Borrower and such Subsidiary Loan Parties and (b) will not (i) violate (A) any provision of law, statute, rule or regulation applicable to Holdings, the Borrower or any such Subsidiary Loan Party, (B) the certificate or articles of incorporation or other constitutive documents (including any partnership, limited liability company or operating agreements) or by-laws of Holdings, the Borrower or any such Subsidiary Loan Parties, (C) any applicable order of any court or any rule, regulation or order of any Governmental Authority applicable to the Borrower or any such Subsidiary Loan Party or (D) any provision of any indenture, certificate of designation for preferred stock, agreement or other instrument to which the Borrower or any such Subsidiary Loan Parties is a party or by which any of them or any of their property is or may be bound, (ii) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under, give rise to a right of or result in any cancellation or acceleration of any right or obligation (including any payment) or to a loss of a material benefit under any such indenture, certificate of designation for preferred stock, agreement or other instrument, where any such conflict, violation, breach or default referred to in clause (i) or (ii) of this Section 3.02(b), could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or (iii) result in the creation or imposition of any Lien upon or with respect to any property or assets now owned or hereafter acquired by the Borrower or any such Subsidiary Loan Parties, other than the Liens created by the Loan Documents and Permitted Liens.

 

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SECTION 3.03                                           Enforceability.  This Agreement has been duly executed and delivered by Holdings and the Borrower and constitutes, and each other Loan Document when executed and delivered by each Loan Party that is party thereto will constitute, a legal, valid and binding obligation of such Loan Party enforceable against each such Loan Party in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other similar laws affecting creditors’ rights generally, (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), (iii) implied covenants of good faith and fair dealing and (iv) any foreign laws, rules and regulations as they relate to pledges of Equity Interests in Foreign Subsidiaries that are not Loan Parties.

 

SECTION 3.04                                           Governmental Approvals  No action, consent or approval of, registration or filing with or any other action by any Governmental Authority is or will be required for the execution, delivery or performance of each Loan Document to which the Borrower or any Subsidiary Loan Party is a party, except for (a) the filing of Uniform Commercial Code financing statements, (b) filings with the United States Patent and Trademark Office and the United States Copyright Office and comparable offices in foreign jurisdictions and equivalent filings in foreign jurisdictions, (c) recordation of the Mortgages, (d) such as have been made or obtained and are in full force and effect, (e) such other actions, consents, approvals, registrations or filings with respect to which the failure to be obtained or made could not reasonably be expected to have a Material Adverse Effect and (f) filings or other actions listed on Schedule 3.04 to the Original Credit Agreement and any other filings or registrations required by the Security Documents.

 

SECTION 3.05                                           Financial Statements.  (a) (i) The audited consolidated balance sheets and the statements of income, stockholders’ equity, and cash flow as of and for the fiscal years ended December 31, 2014, December 31, 2015 and December 31, 2016 for (x) Novitex and its consolidated subsidiaries, (y) SourceHOV and its consolidated subsidiaries and (z) Parent and its consolidated subsidiaries and (ii) the unaudited consolidated balance sheets and statements of income, stockholders’ equity and cash flow as of and for the fiscal quarter ended March 31, 2017 for (x) Novitex and its consolidated subsidiaries, (y) SourceHOV and its consolidated subsidiaries and (z) Parent and its consolidated subsidiaries, including the notes thereto, if applicable, present fairly in all material respects the consolidated financial position of the Novitex, SourceHOV and Parent and their respective consolidated subsidiaries as of the dates and for the periods referred to therein and the results of operations and, if applicable, cash flows for the periods then ended, and, except as set forth on Schedule 3.05 to the Original Credit Agreement, were prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby, except, in the case of interim period financial statements, for the absence of notes and for normal year-end adjustments and except as otherwise noted therein.

 

(b)                                 The Borrower has heretofore furnished to the Lenders the unaudited pro forma consolidated balance sheet and a related pro forma consolidated statement of income of the Borrower and its consolidated subsidiaries (based on the financial statements of the Companies) as of and for the twelve-month period ending March 31, 2017, prepared after giving effect to the Transactions as if the Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of such other statement of income), and which reflect adjustments customary for Rule 144A transactions, were prepared, it being understood that any purchase accounting adjustments may be preliminary in nature and be based only on estimates and allocations determined by the Borrower (the “Pro Forma Closing Balance Sheet”). The Pro Forma Closing Balance Sheet presents fairly in all material respects on a pro forma basis the estimated financial position of the Borrower and its consolidated subsidiaries as at March 31, 2017, assuming that the Transactions had actually occurred at such date.

 

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SECTION 3.06                                           No Material Adverse Effect.  Since the Closing Date, there has been no event, development or circumstance that has had or could reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.07                                           Title to Properties; Possession Under Leases.

 

(a)                                 Each of the Borrower and the Subsidiaries has good and valid record fee simple title to, or valid leasehold interests in, or easements or other limited property interests in, all its properties and assets (including all Mortgaged Properties), except for Permitted Liens and except for minor defects in title that do not materially interfere with its ability to conduct its business as currently conducted or to utilize such properties and assets for their intended purposes and except where the failure to have such title, interests or easements could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  All such properties and assets held in fee simple are free and clear of Liens, other than Permitted Liens or Liens arising by operation of law.

 

(b)                                 None of the Borrower or its Subsidiaries are in default under any leases to which it is a party, except for such defaults as could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  All of the Borrower’s or Subsidiaries’ leases are in full force and effect, except leases in respect of which the failure to be in full force and effect could not reasonably be expected to have a Material Adverse Effect.  Except as set forth on Schedule 3.07(b) to the Original Credit Agreement, the Borrower and each of the Subsidiaries enjoys peaceful and undisturbed possession under all such leases, other than leases in respect of which the failure to enjoy peaceful and undisturbed possession could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(c)                                  Each of the Borrower and the Subsidiaries owns or possesses, or could obtain, ownership or possession of or rights under, on terms not materially adverse to it, all patents, trademarks, service marks, trade names, copyrights, licenses and rights with respect thereto necessary for the present conduct of its business, without any conflict (of which the Borrower has been notified in writing) with the rights of others, and free from any burdensome restrictions on the present conduct of their businesses, except where such conflicts and restrictions could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(d)                                 As of the Closing Date, none of the Borrower or the Subsidiaries has received any written notice of any pending condemnation proceeding affecting any material portion of the Mortgaged Properties or any sale or disposition thereof in lieu of condemnation that remains unresolved as of the Closing Date.

 

(e)                                  None of the Borrower or the Subsidiaries is obligated on the Closing Date under any right of first refusal, option or other contractual right to sell, assign or otherwise dispose of any Mortgaged Property or any interest therein, except as permitted under Section 6.02 or 6.05 or as could not reasonably be expected to have a Material Adverse Effect.

 

(f)                                   Schedule 1.01(e) to the Original Credit Agreement lists each Material Real Property owned by any Loan Party as of the Closing Date.

 

SECTION 3.08                                           Subsidiaries.

 

(a)                                 Schedule 3.08(a) to the Original Credit Agreement sets forth as of the Closing Date the name and jurisdiction of incorporation, formation or organization of each direct or indirect Subsidiary of the Borrower.  Except as set forth on Schedule 3.08(a) to the Original Credit Agreement, as

 

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of the Closing Date, all of the issued and outstanding Equity Interests of each Subsidiary of the Borrower is owned directly by the Borrower or by another Subsidiary.

 

(b)                                 As of the Closing Date, after giving effect to the Transactions, there are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments (other than stock options granted to employees or directors and directors’ qualifying shares) of any nature relating to any Equity Interests of the Borrower or any of the Subsidiaries, except as set forth on Schedule 3.08(b) to the Original Credit Agreement.

 

SECTION 3.09                                           Litigation; Compliance with Laws.

 

(a)                                 As of the Closing Date, there are no actions, suits or proceedings at law or in equity or, to the knowledge of the Borrower, investigations by or on behalf of any Governmental Authority or in arbitration now pending, or, to the knowledge of the Borrower, threatened in writing against or affecting the Borrower, any director, officer, agent or employee thereof, or any of the Subsidiaries or any business, property or rights of any such person that (i) involve any Loan Document or (ii) could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, except (in the case of this clause (ii) only) for any action, suit or proceeding at law or in equity or by or on behalf of any Governmental Authority or in arbitration which has been disclosed in any of any Parent Entity’s public filings with the Securities and Exchange Commission prior to the Closing Date or which arises out of the same facts and circumstances, and alleges substantially the same complaints and damages, as any action, suit or proceeding so disclosed and in which there has been no material adverse change since the date of such disclosure.

 

(b)                                 None of the Borrower, the Subsidiaries or their respective properties or assets is in violation of (nor will the continued operation of their material properties and assets as currently conducted violate) any law, rule or regulation (including any zoning, building, Environmental Law, ordinance, code or approval or any building permit) or any restriction of record or agreement affecting any Mortgaged Property, or is in default with respect to any judgment, writ, injunction or decree of any Governmental Authority, where such violation or default could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

SECTION 3.10                                           Federal Reserve Regulations.  Neither the making of any Loan (or the extension of any Letter of Credit) hereunder nor the use of the proceeds thereof will violate the provisions of Regulation T, Regulation U or Regulation X of the Board.

 

SECTION 3.11                                           Investment Company Act.  None of Holdings, the Borrower and the Subsidiaries is required to be registered as an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

 

SECTION 3.12                                           Use of Proceeds.  The Borrower will use the proceeds of the 2018 Term Loans made on the Repricing Effective Date to refinance the Existing Term Loans (as defined in the First Amendment), to pay related Transaction Expenses and for other general corporate purposes. The Borrower will use the proceeds of the Revolving Facility Loans, and may request the issuance of Letters of Credit, solely for general corporate purposes (including, without limitation, for the Transactions, Repricing Date Transactions, Permitted Business Acquisitions, Capital Expenditures and Transaction Expenses and, in the case of Letters of Credit, for the back-up or replacement of existing letters of credit).

 

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SECTION 3.13                                           Tax Returns.  Except as set forth on Schedule 3.13 to the Original Credit Agreement:

 

(a)                                 Each of Holdings, the Borrower and the Subsidiaries (i) has filed or caused to be filed all federal, state, local and non-U.S. Tax returns required to have been filed by it that are material to such companies taken as a whole and each such Tax return is true and correct in all material respects, including, without limitation, relating to all periods or portions thereof ending on or prior to the Closing Date and (ii) has timely paid or caused to be timely paid all Taxes shown thereon to be due and payable by it on such Tax returns and all other material Taxes (and made adequate provision in accordance with GAAP for the payment of all Taxes not yet due) with respect to all periods or portions thereof ending on or prior to the Closing Date, including in its capacity as a withholding agent, except in each case for Taxes that are being contested in good faith by appropriate proceedings in accordance with Section 5.03 and for which the Borrower or any of the Subsidiaries (as the case may be) has set aside on its books adequate reserves in accordance with GAAP; and

 

(b)                                 Other than as could not be, individually or in the aggregate, reasonably expected to have a Material Adverse Effect: as of the Closing Date, with respect to each of Holdings, the Borrower and the Subsidiaries, (i) there are no claims being asserted in writing with respect to any Taxes, (ii) no presently effective waivers or extensions of statutes of limitation with respect to Taxes have been given or requested and (iii) no Tax returns are being examined by, and no written notification of intention to examine has been received from, the Internal Revenue Service or any other taxing authority.

 

SECTION 3.14                                           No Material Misstatements.

 

(a)                                 All written factual information (other than the Projections, forward-looking information and information of a general economic nature or general industry nature) (the “Information”) concerning the Borrower, the Subsidiaries, the Transactions and any other transactions contemplated by the Original Credit Agreement included in the Information Memorandum or otherwise prepared by or on behalf of the foregoing or their representatives and made available to any Joint Lead Arranger, any Lender or the Administrative Agent in connection with the Transactions or the other transactions contemplated by the Original Credit Agreement (to the extent such Information relates to the Companies on or prior to the Closing Date, to the Companies’ knowledge), when taken as a whole, was true and correct in all material respects, as of the date such Information was furnished to the Lenders and as of the Closing Date and did not, taken as a whole, as of any such date contain any untrue statement of a material fact as of any such date or omit to state a material fact necessary in order to make the statements contained therein, taken as a whole, not materially misleading in light of the circumstances under which such statements were made (after giving effect to all supplements and updates provided thereto).

 

(b)                                 Any Projections and other forward-looking information and information of a general economic nature or general industry nature prepared by or on behalf of the Borrower or any of its representatives and that have been made available to any Lenders or the Administrative Agent in connection with the Transactions or the other transactions contemplated by the Original Credit Agreement have been prepared in good faith based upon assumptions believed by the Borrower to be reasonable as of the date thereof (it being understood that such Projections are as to future events and are not to be viewed as facts, such Projections are subject to significant uncertainties and contingencies and that actual results during the period or periods covered by any such Projections may differ significantly from the projected results, and that no assurance can be given that the projected results will be realized), as of the date such Projections and information were furnished to the Lenders.

 

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SECTION 3.15                                           Employee Benefit Plans.

 

(a)                                 Except as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect or as set forth on Schedule 3.15 to the Original Credit Agreement:  (i) each of the Borrower, the Subsidiaries and the ERISA Affiliates is in compliance with the applicable provisions of ERISA and the Code relating to Plans and the regulations and published interpretations thereunder and any similar applicable law; (ii) no Reportable Event has occurred during the past five years as to which the Borrower, a Subsidiary or any ERISA Affiliate was required to file a report with the PBGC, other than reports that have been filed; (iii) as of the most recent valuation date applicable thereto, no Plan has any Unfunded Pension Liability; (iv) no ERISA Event has occurred or is reasonably expected to occur; and (v) none of the Borrower, the Subsidiaries or the ERISA Affiliates has received any written notification that any Multiemployer Plan is in reorganization or has been terminated within the meaning of Title IV of ERISA, or has knowledge that any Multiemployer Plan is reasonably expected to be in reorganization or to be terminated.

 

(b)                                 Each of the Borrower and the Subsidiaries is in compliance (i) with all applicable provisions of law and all applicable regulations and published interpretations thereunder with respect to any employee pension benefit plan or other employee benefit plan governed by the laws of a jurisdiction other than the United States of America and (ii) with the terms of any such plan, except, in each case, for such noncompliance that could not reasonably be expected to have a Material Adverse Effect.

 

(c)                                  None of, the Borrower or any of the Subsidiaries is or has at any time been an employer (for the purposes of sections 38 to 51 of the Pensions Act 2004) of an occupational pension scheme that is not a money purchase scheme (both terms as defined in the Pension Schemes Act 1993), and none of the Borrower or any of the Subsidiaries is or has at any time been “connected” with or an “associate” of (as those terms are used in sections 39 and 43 of the Pensions Act 2004) such an employer, other than any such scheme, connection or association that could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.16                                           Environmental Matters.  Except as disclosed on Schedule 3.16 to the Original Credit Agreement and except as to matters that could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect (i) no written notice, request for information, order, complaint or penalty has been received by the Borrower or any of the Subsidiaries, and there are no judicial, administrative or other actions, investigations, suits or proceedings pending or, to the Borrower’s knowledge, threatened, that allege a violation of or liability under any applicable Environmental Laws, in each case relating to the Borrower or any of the Subsidiaries, (ii) each of the Borrower and the Subsidiaries has obtained and maintained all permits, licenses and other approvals necessary for its operations to comply with all applicable Environmental Laws and is, and for the previous five (5) years has been, in compliance with the terms of such permits, licenses and other approvals and with all other applicable Environmental Laws, (iii) there has been no Release or threat of Release of any Hazardous Material at, on, under or from any property currently owned or leased or, to the Borrower’s knowledge, formerly owned, operated or leased, by the Borrower or any of its Subsidiaries that would reasonably be expected to give rise to any cost, liability or obligation of the Borrower or any of the Subsidiaries under any applicable Environmental Laws, and, to the Borrower’s knowledge, the Borrower or any of the Subsidiaries have not disposed of or arranged for disposal or treatment, or arranged for transport for disposal or treatment, of any Hazardous Materials at any location in a manner that would reasonably be expected to give rise to any cost, liability or obligation of the Borrower or any of its Subsidiaries under any Environmental Laws, (iv) no Hazardous Material is located at, on or under any property currently or, to the knowledge of the Borrower, formerly owned, operated or leased by the Borrower or any of its Subsidiaries that would reasonably be expected to give rise to any cost, liability or obligation of the Borrower or any of the Subsidiaries under any applicable Environmental Laws, and, to the Borrower’s knowledge, no Hazardous Material has been generated, owned, treated, stored, handled or controlled by the Borrower or any of its Subsidiaries and transported to or Released at any location in a manner that

 

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would reasonably be expected to give rise to any cost, liability or obligation of the Borrower or any of the Subsidiaries under any Environmental Laws, and (v) there are no written agreements in which the Borrower or any of the Subsidiaries has expressly assumed or undertaken responsibility, and such assumption or undertaking of responsibility has not expired or otherwise terminated, for any liability or obligation of any other person arising under or relating to applicable Environmental Laws, which in any such case has not been made available to the Administrative Agent prior to the Closing Date.

 

SECTION 3.17                                           Security Documents.

 

(a)                                 Each of the Collateral Agreement and the Holdings Guarantee and Pledge Agreement is effective to create in favor of the Collateral Agent (for the benefit of the Secured Parties), in each case, a legal, valid and enforceable security interest in the Collateral described therein and proceeds thereof.  As of the Closing Date, in the case of the Pledged Collateral described in the Collateral Agreement, when certificates or promissory notes, as applicable, representing such Pledged Collateral and required to be delivered under the applicable Security Document are delivered to the Collateral Agent, and in the case of the other Collateral described in the Collateral Agreement (other than the Intellectual Property), when financing statements and other filings specified in the Perfection Certificate are filed in the offices specified in the Perfection Certificate, the Collateral Agent (for the benefit of the Secured Parties) shall have a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such Collateral and, subject to Section 9-315 of the New York Uniform Commercial Code, the proceeds thereof, as security for the Obligations to the extent perfection can be obtained by filing Uniform Commercial Code financing statements, in each case prior and superior in right to the Lien of any other person (except Permitted Liens).

 

(b)                                 When the Collateral Agreement or an ancillary document thereunder is properly filed and recorded in the United States Patent and Trademark Office and the United States Copyright Office, and, with respect to Collateral in which a security interest cannot be perfected by such filings, upon the proper filing of the financing statements referred to in clause (a) above, the Collateral Agent (for the benefit of the Secured Parties) shall have a fully perfected (subject to exceptions arising from defects in the chain of title, which defects in the aggregate do not constitute a Material Adverse Effect hereunder) Lien on, and security interest in, all right, title and interest of the Loan Parties thereunder in the United States Intellectual Property listed in such ancillary document, in each case prior and superior in right to the Lien of any other person, except for Permitted Liens (it being understood that subsequent recordings in the United States Patent and Trademark Office and the United States Copyright Office may be necessary to perfect a Lien on registered trademarks and patents, trademark and patent applications and registered copyrights and exclusive licenses of registered copyrights acquired by the Loan Parties after the Closing Date).

 

(c)                                  The Mortgages, if any, executed and delivered on the Closing Date are, and the Mortgages executed and delivered after the Closing Date pursuant to Section 5.11 shall be, in a form effective to create in favor of the Collateral Agent (for the benefit of the Secured Parties) legal, valid and enforceable Liens on all of the Loan Parties’ rights, titles and interests in and to the Mortgaged Property thereunder and the proceeds thereof, and when such Mortgages are filed, recorded or registered in the proper real estate filing or recording offices or registry, and all relevant mortgage taxes, recording charges and similar amounts are duly paid, the Collateral Agent (for the benefit of the Secured Parties) shall have valid Liens with record notice to third parties on, and security interests in, all rights, titles and interests of the Loan Parties in such Mortgaged Property and, to the extent applicable, subject to Section 9-315 of the Uniform Commercial Code where applicable, the proceeds thereof, in each case prior and superior in right to the Lien of any other person, except for Permitted Liens.

 

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(d)                                 Notwithstanding anything herein (including this Section 3.17) or in any other Loan Document to the contrary, no Borrower or any other Loan Party makes any representation or warranty as to the effects of perfection or non-perfection, the priority or the enforceability of any pledge of or security interest in any Equity Interests of any Foreign Subsidiary, or as to the rights and remedies of the Agents or any Lender with respect thereto, under foreign law.

 

SECTION 3.18                                           Location of Real Property.  The Perfection Certificate lists correctly, in all material respects, as of the Closing Date all Material Real Property owned by the Borrower and the Subsidiary Loan Parties and the addresses thereof.  As of the Closing Date, the Borrower and the Subsidiary Loan Parties own in fee all the Real Property set forth as being owned by them in the Perfection Certificate, subject to Permitted Liens, except to the extent set forth therein.

 

SECTION 3.19                                           Solvency.

 

(a)                                 As of the Closing Date, immediately after giving effect to the consummation of the Transactions on the Closing Date, (i) the fair value of the assets of the Borrower and its Subsidiaries on a consolidated basis, at a fair valuation, will exceed the debts and liabilities, direct, subordinated, contingent or otherwise, of the Borrower and its Subsidiaries on a consolidated basis; (ii) the present fair saleable value of the property of the Borrower and its Subsidiaries on a consolidated basis will be greater than the amount that will be required to pay the probable liability of the Borrower and its Subsidiaries on a consolidated basis on their debts and other liabilities, direct, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (iii) the Borrower and its Subsidiaries on a consolidated basis will be able to pay their debts and liabilities, direct, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (iv) the Borrower and its Subsidiaries on a consolidated basis will not have unreasonably small capital with which to conduct the businesses in which they are engaged as such businesses are now conducted and are proposed to be conducted following the Closing Date.

 

(b)                                 As of the Closing Date, immediately after giving effect to the consummation of the Transactions on the Closing Date, the Borrower does not intend to, and the Borrower does not believe that it or any of its Subsidiaries will, incur debts beyond its ability to pay such debts as they mature, taking into account the timing and amounts of cash to be received by it or any such Subsidiary and the timing and amounts of cash to be payable on or in respect of its Indebtedness or the Indebtedness of any such Subsidiary.

 

SECTION 3.20                                           Labor Matters.  Except as, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect:  (a) there are no strikes or other labor disputes pending or threatened against the Borrower or any of the Subsidiaries; (b) the hours worked and payments made to employees of the Borrower and the Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable law dealing with such matters; and (c) all payments due from the Borrower or any of the Subsidiaries or for which any claim may be made against the Borrower or any of the Subsidiaries, on account of wages and employee health and welfare insurance and other benefits have been paid or accrued as a liability on the books of the Borrower or such Subsidiary to the extent required by GAAP.  Except as, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect, the consummation of the Transactions will not give rise to a right of termination or right of renegotiation on the part of any union under any material collective bargaining agreement to which the Borrower or any of the Subsidiaries (or any predecessor) is a party or by which the Borrower or any of the Subsidiaries (or any predecessor) is bound.

 

SECTION 3.21                                           Insurance.  Schedule 3.21 to the Original Credit Agreement sets forth a true, complete and correct description, in all material respects, of all material insurance (excluding any title

 

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insurance) maintained by or on behalf of the Borrower or the Subsidiaries as of the Closing Date.  As of such date, such insurance is in full force and effect.

 

SECTION 3.22                                           Senior Debt. The Loan Obligations constitute “Senior Debt” (or the equivalent thereof) under the documentation governing any Material Indebtedness of any Loan Party permitted to be incurred hereunder constituting Indebtedness that is subordinated in right of payment to the Loan Obligations.

 

SECTION 3.23                                           USA PATRIOT Act; Sanctions Laws and Export Controls Laws.

 

(a)                                 The Borrower and each of its Subsidiaries has been during the past five years and is in material compliance in all material respects with the material provisions of the USA PATRIOT Act, and, at least three Business Days prior to the Closing Date, the Borrower has provided to the Administrative Agent all information related to the Loan Parties (including names, addresses and tax identification numbers (if applicable)) reasonably requested in writing by the Administrative Agent not less than 10 Business Days prior to the Closing Date and mutually agreed to be required under “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act, to be obtained by the Administrative Agent or any Lender.

 

(b)                                 None of Holdings, the Borrower or any of its Subsidiaries, any director or officer, nor, to the knowledge of the Borrower or any of its Subsidiaries, any agent, employee or Affiliate of the Borrower or any of the Subsidiaries is currently the target of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”), the European Union, the United Nations Security Council or Her Majesty’s Treasury (“Sanctions”). The Borrower will not knowingly use the proceeds of the Loans or the Letters of Credit or otherwise make available such proceeds to any person, for the purpose of financing prohibited activities of any person that is currently the target of any Sanctions or for the purpose of financing any activities, business or transaction with or in any country that is the target of Sanctions, to the extent such activities, businesses or transaction would be prohibited by applicable sanctions laws and regulations administered by the United States of America, including OFAC and the U.S. State Department, the United Nations Security Council, Her Majesty’s Treasury, the European Union or relevant member states of the European Union (collectively, “Sanctions Laws”), or in any manner that would result in the violation of any Sanctions Laws applicable to any party hereto. Holdings, the Borrower and its Subsidiaries have been over the past five years and are in material compliance with all applicable Sanctions Laws and the Export Administration Regulations maintained by the U.S. Department of Commerce (“Export Controls Laws”).

 

SECTION 3.24                                           Foreign Corrupt Practices Act.  Holdings, the Borrower and its Subsidiaries, their directors and officers, and, to the knowledge of the Borrower or any of its Subsidiaries, their agents and employees, have been during the past five years and are in material compliance with the U.S. Foreign Corrupt Practices Act of 1977, as amended and any similar law of a jurisdiction in which the Borrower or any of its Subsidiaries conduct their business and to which they are lawfully subject (collectively, “Anti-Corruption Laws”), in each case. Holdings and the Borrower have implemented and maintain in effect policies designed to promote and achieve compliance with Anti-Corruption Laws. No part of the proceeds of the Loans made hereunder will knowingly be used to make any unlawful bribe, payoff, influence payment, kickback or other unlawful payment.

 

SECTION 3.25                                           Intellectual Property.  Except as would not reasonably be expected to have a Material Adverse Effect: (a) the Borrower and each of its Subsidiaries owns, or possesses the right to use, all Intellectual Property that is used or held for use in or is otherwise reasonably necessary for the present conduct of their respective businesses, (b) the Borrower and its Subsidiaries are not interfering with, infringing upon, misappropriating or otherwise violating the Intellectual Property of any person, and (c)

 

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no claim or litigation regarding any of the Intellectual Property owned, licensed or otherwise used by the Borrower and its Subsidiaries is pending or, to the knowledge of the Borrower, threatened.

 

ARTICLE IV
 CONDITIONS OF LENDING

 

The obligations of (a) the Lenders to make Loans and (b) any Issuing Bank to issue, amend, extend or renew Letters of Credit or increase the stated amounts of Letters of Credit hereunder (each, a “Credit Event”) are subject to the satisfaction (or waiver in accordance with Section 9.09) of the following conditions:

 

SECTION 4.01                                           All Credit Events.  On the date of each Borrowing and on the date of each issuance, amendment, extension or renewal of a Letter of Credit (in each case, other than, with respect to clauses (b) and (c) below, pursuant to an Incremental Assumption Agreement to the extent not required by such Incremental Assumption Agreement):

 

(a)                                 The Administrative Agent shall have received, in the case of a Borrowing, a Borrowing Request as required by Section 2.03 (or a Borrowing Request shall have been deemed given in accordance with the last paragraph of Section 2.03) or, in the case of the issuance, amendment, extension or renewal of a Letter of Credit, the applicable Issuing Bank and the Administrative Agent shall have received a notice requesting the issuance, amendment, extension or renewal of such Letter of Credit as required by Section 2.05(b).

 

(b)                                 In the case of each Credit Event (other than an amendment, extension or renewal of a Letter of Credit without any (i) increase in the stated amount of such Letter of Credit or (ii) extension of the expiration of such Letter of Credit), the representations and warranties set forth in the Loan Documents shall be true and correct in all material respects as of such date, with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such earlier date).

 

(c)                                  In the case of each Borrowing or other Credit Event, at the time of and immediately after such Borrowing or issuance, amendment, extension or renewal of a Letter of Credit (other than an amendment, extension or renewal of a Letter of Credit without any (i) increase in the stated amount of such Letter of Credit or (ii) extension of the expiration of such Letter of Credit), as applicable, no Event of Default or Default shall have occurred and be continuing.

 

(d)                                 Each Borrowing and each issuance, amendment, extension or renewal of a Letter of Credit (other than an amendment, extension or renewal of a Letter of Credit without any (i) increase in the stated amount of such Letter of Credit or (ii) extension of the expiration of such Letter of Credit) shall be deemed to constitute a representation and warranty by the Borrower on the date of such Borrowing, issuance, amendment, extension or renewal as applicable, as to the matters specified in clauses (b) and (c) of this Section 4.01.

 

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SECTION 4.02                                           [Reserved].

 

ARTICLE V
 AFFIRMATIVE COVENANTS

 

The Borrower covenants and agrees with each Lender that until the Termination Date, unless the Required Lenders shall otherwise consent in writing, the Borrower will, and will cause each of the Subsidiaries to:

 

SECTION 5.01                                           Existence; Businesses and Properties.

 

(a)                                 Do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence, except, in the case of a Subsidiary, where the failure to do so would not reasonably be expected to have a Material Adverse Effect, and except as otherwise permitted under Section 6.05; provided that the Borrower may liquidate or dissolve one or more Subsidiaries if the assets of such Subsidiaries (to the extent they exceed estimated liabilities) are acquired by the Borrower or a Wholly Owned Subsidiary of the Borrower in such liquidation or dissolution, except that  Subsidiary Loan Parties may not be liquidated into Subsidiaries that are not Subsidiary Loan Parties unless such liquidation is otherwise permitted under Section 6.05.

 

(b)                                 Except where the failure to do so would not reasonably be expected to have a Material Adverse Effect, do or cause to be done all things necessary to (i) lawfully obtain, preserve, renew, extend and keep in full force and effect the permits, franchises, authorizations, Intellectual Property, licenses and rights with respect thereto necessary to the normal conduct of its business, and (ii) at all times maintain and preserve all material property necessary to the normal conduct of its business and keep such property in good repair, working order and condition (ordinary wear and tear excepted) and from time to time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto necessary in order that the business carried on in connection therewith, if any, may be properly conducted at all times (in each case except as permitted by this Agreement).

 

SECTION 5.02                                           Insurance.

 

(a)                                 Maintain, with financially sound and reputable insurance companies, insurance (subject to customary deductibles and retentions) in such amounts and against such risks as are customarily maintained by similarly situated companies engaged in the same or similar businesses operating in the same or similar locations, cause the Collateral Agent to be listed as a co-loss payee on property and casualty policies with respect to Mortgaged Property located in the United States of America and as an additional insured on liability policies.  Notwithstanding the foregoing, the Borrower and the Subsidiaries may self-insure with respect to such risks with respect to which companies of established reputation engaged in the same general line of business in the same general area usually self-insure.

 

(b)                                 Except as the Administrative Agent may agree in its reasonable discretion, cause all such property and casualty insurance policies with respect to the Mortgaged Property located in the United States of America to be endorsed or otherwise amended to include a “standard” or “New York” lender’s loss payable endorsement, in form and substance reasonably satisfactory to the Administrative Agent, deliver a certificate of an insurance broker to the Collateral Agent; use commercially reasonable efforts to cause each such policy covered by this clause (b) to provide that it shall not be cancelled or not renewed upon less than 30 days’ prior written notice thereof by the insurer to the Collateral Agent; deliver to the Collateral Agent, prior to or concurrently with the cancellation or nonrenewal of any such policy of insurance covered by this clause (b), a copy of a renewal or replacement policy (or other evidence of

 

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renewal of a policy previously delivered to the Collateral Agent), or insurance certificate with respect thereto, together with evidence satisfactory to the Administrative Agent of payment of the premium therefor, in each case of the foregoing, to the extent customarily maintained, purchased or provided to, or at the request of, lenders by similarly situated companies in connection with credit facilities of this nature.

 

(c)                                  If any portion of any Mortgaged Property is at any time located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a special flood hazard area (each a “Special Flood Hazard Area”) with respect to which flood insurance has been made available under the Flood Insurance Laws, (i) maintain, or cause to be maintained, with a financially sound and reputable insurer, flood insurance in an amount and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and (ii) deliver to the Collateral Agent evidence of such compliance in form and substance reasonably acceptable to the Administrative Agent, including a copy of the flood insurance policy and a declaration page relating thereto.

 

(d)                                 In connection with the covenants set forth in this Section 5.02, it is understood and agreed that:

 

(i)                                     the Administrative Agent, the Collateral Agent, the Lenders, the Issuing Banks and their respective agents or employees shall not be liable for any loss or damage insured by the insurance policies required to be maintained under this Section 5.02, it being understood that (A) the Loan Parties shall look solely to their insurance companies or any other parties other than the aforesaid parties for the recovery of such loss or damage and (B) such insurance companies shall have no rights of subrogation against the Administrative Agent, the Collateral Agent, the Lenders, any Issuing Bank or their agents or employees.  If, however, the insurance policies, as a matter of the internal policy of such insurer, do not provide waiver of subrogation rights against such parties, as required above, then each of Holdings and the Borrower, on behalf of itself and behalf of each of its Subsidiaries, hereby agrees, to the extent permitted by law, to waive, and further agrees to cause each of their Subsidiaries to waive, its right of recovery, if any, against the Administrative Agent, the Collateral Agent, the Lenders, any Issuing Bank and their agents and employees;

 

(ii)                                  the designation of any form, type or amount of insurance coverage by the Collateral Agent (including acting in the capacity as the Collateral Agent) under this Section 5.02 shall in no event be deemed a representation, warranty or advice by the Collateral Agent or the Lenders that such insurance is adequate for the purposes of the business of Holdings, the Borrower and the Subsidiaries or the protection of their properties; and

 

(iii)                               the amount and type of insurance that the Borrower and its Subsidiaries has in effect as of the Closing Date satisfies for all purposes the requirements of this Section 5.02.

 

SECTION 5.03                                           Taxes.  Pay and discharge promptly when due all material Taxes upon it or upon its income or profits or in respect of its property, before the same shall become delinquent or in default, as well as all lawful claims for labor, materials and supplies or otherwise that, if unpaid, might give rise to a Lien (other than a Permitted Lien) upon such properties or any part thereof; provided, however, that such payment and discharge shall not be required with respect to any such Tax so long as (a) the validity or amount thereof shall be contested in good faith by appropriate proceedings, (b) Holdings, the Borrower or a Subsidiary thereof, as applicable, shall have set aside on its books adequate reserves in accordance with GAAP with respect thereto, to the extent required under accepted accounting principles, and (c) the failure to make such payment and discharge could not reasonably be expected to result in a Material Adverse Effect.

 

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SECTION 5.04                                           Financial Statements, Reports, etc.  Furnish to the Administrative Agent (which will promptly furnish such information to the Lenders):

 

(a)                                 within 105 days after the end of each fiscal year, a consolidated balance sheet and related statements of operations, cash flows and owners’ equity showing the financial position of the Borrower and its Subsidiaries as of the close of such fiscal year and the consolidated results of their operations during such year and, starting with the fiscal year ending December 31, 2018, setting forth in comparative form the corresponding figures for the prior fiscal year, which consolidated balance sheet and related statements of operations, cash flows and owners’ equity shall be accompanied by customary management’s discussion and analysis and audited by independent public accountants of recognized national standing and accompanied by an opinion of such accountants (which opinion shall not be qualified as to scope of audit or as to the status of the Borrower or any Material Subsidiary as a going concern, except for qualifications for a change in accounting principles with which such accountants concur and which shall have been disclosed in the notes to the financial statements or other than solely with respect to, or resulting solely from, an upcoming maturity date under any series of Indebtedness occurring within one year from the time such opinion is delivered or any potential inability to satisfy a financial maintenance covenant on a future date or in a future period) to the effect that such consolidated financial statements fairly present, in all material respects, the financial position and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP (it being understood that the delivery by the Borrower of annual reports on Form 10-K (or any successor or comparable form) of the Borrower and its consolidated Subsidiaries shall satisfy the requirements of this Section 5.04(a) to the extent such annual reports include the information specified herein);

 

(b)                                 within 60 days after the end of each of the first three fiscal quarters of each fiscal year (commencing with the fiscal quarter ending September 30, 2017), a consolidated balance sheet and related statements of operations and cash flows showing the financial position of the Borrower and its Subsidiaries as of the close of such fiscal quarter and the consolidated results of their operations during such fiscal quarter and the then-elapsed portion of the fiscal year and, starting with the fiscal quarter ending September 30, 2018, setting forth in comparative form the corresponding figures for the corresponding periods of the prior fiscal year, all of which shall be in reasonable detail, which consolidated balance sheet and related statements of operations and cash flows shall be accompanied by customary management’s discussion and analysis and which consolidated balance sheet and related statements of operations and cash flows shall be certified by a Financial Officer of the Borrower on behalf of the Borrower as fairly presenting, in all material respects, the financial position and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP (subject to normal year-end audit adjustments and the absence of footnotes) (it being understood that the delivery by the Borrower of quarterly reports on Form 10-Q (or any successor or comparable form) of the Borrower and its consolidated Subsidiaries shall satisfy the requirements of this Section 5.04(b) to the extent such quarterly reports include the information specified herein);

 

(c)                                  (x) concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Borrower (i) certifying that no Event of Default or Default has occurred since the date of the last certificate delivered pursuant to this Section 5.04(c) or, if such an Event of Default or Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, (ii) commencing with the end of the first full fiscal quarter ending after the Closing Date, setting forth computations in reasonable detail demonstrating compliance with the Financial Covenant and (iii) setting forth the calculation and uses of the Available Free Cash Flow Amount for the fiscal period then ended if the Borrower shall have used the Available Free Cash Flow Amount for any purpose during such fiscal period and (y) concurrently with any delivery of financial statements under clause (a) above, if the accounting firm is not restricted from providing such a certificate by its policies office, a certificate of the accounting firm opining on or

 

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certifying such statements stating whether they obtained knowledge during the course of their examination of such statements of any Default or Event of Default (which certificate may be limited to accounting matters and disclaim responsibility for legal interpretations);

 

(d)                                 promptly after the same become publicly available, copies of all periodic and other publicly available reports, proxy statements and, to the extent requested by the Administrative Agent, other materials filed by Holdings, the Borrower or any of the Subsidiaries with the SEC, or after an initial public offering, distributed to its stockholders generally, as applicable; provided, however, that such reports, proxy statements, filings and other materials required to be delivered pursuant to this clause (d) shall be deemed delivered for purposes of this Agreement when posted to the website of the Borrower (or Holdings or any Parent Entity referred to in Section 5.04(h)) or the website of the SEC and written notice of such posting has been delivered to the Administrative Agent;

 

(e)                                  within 90 days (or such later date as the Administrative Agent may agree in its reasonable discretion) after the beginning of each fiscal year (commencing with the fiscal year ending December 31, 2018), a consolidated annual budget for such fiscal year consisting of a projected consolidated balance sheet of the Borrower and its Subsidiaries as of the end of the following fiscal year and the related consolidated statements of projected cash flow and projected income (collectively, the “Budget”), which Budget shall in each case be accompanied by the statement of a Financial Officer of the Borrower to the effect that the Budget is based on assumptions believed by the Borrower to be reasonable as of the date of delivery thereof;

 

(f)                                   upon the reasonable request of the Administrative Agent not more frequently than once a year, an updated Perfection Certificate (or, to the extent such request relates to specified information contained in the Perfection Certificate, such information) reflecting all changes since the date of the information most recently received pursuant to this Section 5.04(f) or Section 5.11(f);

 

(g)                                  promptly, from time to time, such other customary information regarding the operations, business affairs and financial condition of Holdings, the Borrower or any of the Subsidiaries, or compliance with the terms of any Loan Document as in each case the Administrative Agent may reasonably request (for itself or on behalf of any Lender);

 

(h)                                 promptly upon request by the Administrative Agent, copies of: (i) each Schedule B (Actuarial Information) to the most recent annual report (Form 5500 Series) filed with the Internal Revenue Service with respect to a Plan; (ii) the most recent actuarial valuation report for any Plan; (iii) all notices received from a Multiemployer Plan sponsor, a plan administrator or any governmental agency, or provided to any Multiemployer Plan by the Borrower, a Subsidiary or any ERISA Affiliate, concerning an ERISA Event; and (iv) such other documents or governmental reports or filings relating to any Plan or Multiemployer Plan as the Administrative Agent shall reasonably request;

 

(i)                                     in the event that Holdings or any Parent Entity reports on a consolidated basis, such consolidated reporting at Holdings or such Parent Entity’s level in a manner consistent with that described in clauses (a) and (b) of this Section 5.04 for the Borrower (together with a reconciliation showing the adjustments necessary to determine compliance by the Borrower and its Subsidiaries with the Financial Covenant) will satisfy the requirements of such clauses; and

 

(j)                                    at a time mutually agreed with the Administrative Agent after the delivery of the financial statements required pursuant to Sections 5.04(a) and 5.04(b) (but not later than 10 Business Days after such delivery), commencing with the fiscal quarter ending December 31, 2017, upon request of the Administrative Agent, the Borrower shall cause appropriate Financial Officers or other officers with reasonably equivalent duties of the Borrower to participate in one conference call for Lenders to discuss

 

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the financial condition and results of operations of the Borrower and its Subsidiaries for the most recently ended fiscal period; provided that, for the avoidance of doubt, any call to discuss the earnings of the Borrower and its Subsidiaries for the most recently ended fiscal period shall satisfy the requirement set forth in this clause (i) to the extent the Lenders are invited to participate in such call.

 

The Borrower hereby acknowledges and agrees that all financial statements furnished pursuant to clauses (a), (b) and (d) above are hereby deemed to be Communications suitable for distribution, and to be made available, to Public Lenders as contemplated by Section 9.17 and may be treated by the Administrative Agent and the Lenders as if the same had been marked “PUBLIC” in accordance with such clause (unless the Borrower otherwise notifies the Administrative Agent in writing on or prior to delivery thereof).

 

SECTION 5.05                                           Litigation and Other Notices.  Furnish to the Administrative Agent (which the Administrative Agent shall promptly distribute to the Lenders) written notice of the following promptly after any Responsible Officer of Holdings or the Borrower obtains actual knowledge thereof:

 

(a)                                 any Event of Default or Default, specifying the nature and extent thereof and the corrective action (if any) proposed to be taken with respect thereto;

 

(b)                                 the filing or commencement of, or any written threat or notice of intention of any person to file or commence, any action, suit or proceeding, whether at law or in equity or by or before any Governmental Authority or in arbitration, against Holdings, the Borrower or any of its Subsidiaries as to which an adverse determination is reasonably probable and that, if adversely determined, would reasonably be expected to have a Material Adverse Effect;

 

(c)                                  any other development specific to Holdings, the Borrower or any of its Subsidiaries that is not a matter of general public knowledge and that has had, or would reasonably be expected to have, a Material Adverse Effect; and

 

(d)                                 the occurrence of any ERISA Event that, together with all other ERISA Events that have occurred, would reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.06                                           Compliance with Laws.

 

(a) Comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect; provided that this Section 5.06 shall not apply to Environmental Laws, which are the subject of Section 5.10, or to laws related to Taxes, which are the subject of Section 5.03.  The Borrower will implement, maintain in effect and enforce policies and procedures reasonably designed to ensure compliance in all material respects by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws, Sanctions Laws and Export Controls Laws.

 

(b) Comply in all material respects with the USA PATRIOT Act.

 

SECTION 5.07                                           Maintaining Records; Access to Properties and Inspections.  Maintain all financial records in accordance with GAAP and permit any persons designated by the Administrative Agent or, upon the occurrence and during the continuance of an Event of Default, any Lender to visit and inspect the financial records and the properties of Holdings, the Borrower or any of the Subsidiaries at reasonable times, upon reasonable prior written notice to Holdings or the Borrower, and as often as reasonably requested and to make extracts from and copies of such financial records, and permit any persons designated by the Administrative Agent or, upon the occurrence and during the continuance of an

 

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Event of Default, any Lender upon reasonable prior written notice to Holdings or the Borrower to discuss the affairs, finances and condition of Holdings, the Borrower or any of the Subsidiaries with the officers thereof and independent accountants therefor (so long as the Borrower has the opportunity to participate in any such discussions with such accountants); provided that none of Holdings, the Borrower nor any of the Subsidiaries will be required to provide any information to the extent that the provision thereof would violate any law, rule or regulation or results in the breach of any binding contractual obligations or the loss of any professional privilege.  Administrative Agent and any Lender permitted access as herein provided will not unreasonably interfere with the use and operation of Holdings, the Borrower or any Subsidiary (or any tenants, subtenants, licensees or occupants thereof).

 

SECTION 5.08                                           Payment of Obligations.  Pay its Material Indebtedness and other material obligations before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP, and (c) the failure to make such payment could not reasonably be expected to result in a Material Adverse Effect.

 

SECTION 5.09                                           Use of Proceeds.  Use the proceeds of the Loans and the Letters of Credit only as contemplated in Section 3.12.

 

SECTION 5.10                                           Compliance with Environmental Laws.  Comply with all Environmental Laws applicable to its operations and properties; and comply with and obtain and renew all material permits, licenses and other approvals required pursuant to Environmental Law for its operations and properties in each case in accordance with Environmental Laws, except, in each case with respect to this Section 5.10, to the extent the failure to do so would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

SECTION 5.11                                           Further Assurances; Additional Security.

 

(a)                                 Execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements, fixture filings, Mortgages and other documents), that the Administrative Agent may reasonably request (including, without limitation, those required by applicable law), to satisfy the Collateral and Guarantee Requirement and to cause the Collateral and Guarantee Requirement to be and remain satisfied, all at the expense of the Loan Parties and provide to the Collateral Agent, from time to time upon reasonable request, evidence reasonably satisfactory to the Administrative Agent as to the perfection and priority of the Liens created or intended to be created by the Security Documents.

 

(b)                                 If any asset (other than Real Property) that has an individual Fair Market Value (as determined in good faith by the Borrower) in an amount greater than $5,000,000 is acquired by the Borrower or any Subsidiary Loan Party after the Closing Date or owned by an entity at the time it becomes a Subsidiary Loan Party (in each case other than (x) assets constituting Collateral under a Security Document that become subject to the Lien of such Security Document upon acquisition thereof and (y) assets constituting Excluded Property), the Borrower or such Subsidiary Loan Party, as applicable, will (i) notify the Collateral Agent of such acquisition or ownership and (ii) cause such asset to be subjected to a Lien (subject to any Permitted Liens) securing the Obligations by, and take, and cause the Subsidiary Loan Parties to take, such actions as shall be reasonably requested by the Administrative Agent to grant and perfect such Liens, including actions described in clause (a) of this Section 5.11, all at the expense of the Loan Parties, subject to clause (g) below.

 

(c)                                  (i) Grant and cause each of the Subsidiary Loan Parties to grant to the Collateral Agent security interests in, and mortgages on, any Material Real Property of the Borrower or such

 

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Subsidiary Loan Parties, as applicable, that are not Mortgaged Property as of the Closing Date, to the extent acquired after the Closing Date, within 90 days after such acquisition (or such later date as the Administrative Agent may agree in their reasonable discretion) pursuant to documentation in such form as is reasonably satisfactory to the Administrative Agent and the Borrower (each, an “Additional Mortgage”), which security interest and mortgage shall constitute valid and enforceable Liens subject to no other Liens except Permitted Liens, (ii) record or file, and cause each such Subsidiary to record or file, the Additional Mortgage or instruments related thereto in such manner and in such places as is required by law to establish, perfect, preserve and protect the Liens in favor of the Collateral Agent (for the benefit of the Secured Parties) required to be granted pursuant to the Additional Mortgages and pay, and cause each such Subsidiary to pay, in full, all Taxes, fees and other charges required to be paid in connection with such recording or filing, in each case subject to clause (g) below, and (iii) deliver to the Collateral Agent an updated Schedule 1.01(e) to the Original Credit Agreement reflecting such additional Mortgaged Properties.  Unless otherwise waived by the Administrative Agent, with respect to each such Additional Mortgage, the Borrower shall cause the requirements set forth in clauses (f) and (g) of the definition of “Collateral and Guarantee Requirement” to be satisfied with respect to such Material Real Property.

 

(d)                                 If any additional direct or indirect Subsidiary of the Borrower is formed or acquired after the Closing Date (with any Subsidiary Redesignation resulting in an Unrestricted Subsidiary becoming a Subsidiary being deemed to constitute the acquisition of a Subsidiary) and if such Subsidiary is a Subsidiary Loan Party, within 15 Business Days after the date such Subsidiary is formed or acquired (or such longer period as the Administrative Agent may agree in its reasonable discretion), notify the Collateral Agent thereof and, within 20 Business Days after the date such Subsidiary is formed or acquired or such longer period as the Administrative Agent may agree in its reasonable discretion (or, with respect to clauses (f), (g) and (h) of the definition of “Collateral and Guarantee Requirement,” within 90 days after such formation or acquisition or such longer period as set forth therein or as the Administrative Agent may agree in its reasonable discretion, as applicable), cause the Collateral and Guarantee Requirement to be satisfied with respect to such Subsidiary and with respect to any Equity Interest in or Indebtedness of such Subsidiary owned by or on behalf of any Loan Party, subject to clause (g) below.

 

(e)                                  If any additional Foreign Subsidiary of the Borrower is formed or acquired after the Closing Date (with any Subsidiary Redesignation resulting in an Unrestricted Subsidiary becoming a Subsidiary being deemed to constitute the acquisition of a Subsidiary) and if such Subsidiary is a “first tier” Foreign Subsidiary of a Loan Party, within 15 Business Days after the date such Foreign Subsidiary is formed or acquired (or such longer period as the Administrative Agent may agree in its reasonable discretion), notify the Collateral Agent thereof and, within 50 Business Days after the date such Foreign Subsidiary is formed or acquired or such longer period as the Administrative Agent may agree in its reasonable discretion, cause the Collateral and Guarantee Requirement to be satisfied with respect to any Equity Interest in such Foreign Subsidiary owned by or on behalf of any Loan Party, subject to clause (g) below.

 

(f)                                   Furnish to the Collateral Agent prompt written notice of any change (A) in any Loan Party’s corporate or organization name, (B) in any Loan Party’s identity or organizational structure, (C) in any Loan Party’s organizational identification number, (D) in any Loan Party’s jurisdiction of organization or (E) in the location of the chief executive office of any Loan Party that is not a registered organization; provided that the Borrower shall not effect or permit any such change unless all filings have been made, or will have been made within 30 days following such change (or such longer period as the Administrative Agent may agree in its reasonable discretion), under the Uniform Commercial Code that are required in order for the Collateral Agent to continue at all times following such change to have a

 

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valid, legal and perfected security interest in all the Collateral in which a security interest may be perfected by such filing, for the benefit of the Secured Parties.

 

(g)                                  The Collateral and Guarantee Requirement and the other provisions of this Section 5.11 and the other Loan Documents with respect to Collateral need not be satisfied with respect to any of the following (collectively, the “Excluded Property”):  (i) any Real Property other than Material Real Property, (ii) motor vehicles and other assets subject to certificates of title, letter of credit rights (in each case, other than to the extent a Lien on such assets or such rights can be perfected by filing a UCC-1) and commercial tort claims with a value of less than $10,000,000, (iii) pledges and security interests prohibited by applicable law, rule, regulation or contractual obligation (with respect to any such contractual obligation, only to the extent such restriction is permitted under Section 6.09(b) and such restriction is binding on such assets on the Closing Date or on the date of acquisition thereof and not entered into in contemplation thereof (other than in connection with the incurrence of Indebtedness of the type contemplated by Section 6.01(i))) (in each case, except to the extent such prohibition is unenforceable after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code) or which could require governmental (including regulatory) consent, approval, license or authorization to be pledged (unless such consent, approval, license or authorization has been received), (iv) assets to the extent a security interest in such assets could reasonably be expected to result in material adverse tax consequences as determined in good faith by the Borrower in consultation with the Administrative Agent, (v) any lease, license or other agreement to the extent that a grant of a security interest therein would violate or invalidate such lease, license or agreement or create a right of termination in favor of any other party thereto (other than the Borrower or any Guarantor) after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code, (vi) those assets as to which the Administrative Agent and the Borrower reasonably agree that the cost or other consequence of obtaining such a security interest or perfection thereof are excessive in relation to the value afforded thereby, (vii) any governmental licenses or state or local franchises, charters and authorizations, to the extent security interests in such licenses, franchises, charters or authorizations are prohibited or restricted thereby after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code, (viii) any “intent-to-use” trademark applications for which a verified Statement of Use or an Amendment to Allege Use has not been filed with the United States Patent and Trademark Office, (ix) other customary exclusions under applicable local law or in applicable local jurisdictions, (x) Securitization Assets sold to any Special Purpose Securitization Subsidiary or otherwise pledged, factored, transferred or sold in connection with any Permitted Securitization Financing, and any other assets subject to Liens securing Permitted Securitization Financings, (xi) any Excluded Securities, (xii) any Third Party Funds, (xiii) any equipment or other asset that is subject to a Lien permitted by any of clauses (c), (i), (j) or (ii) of Section 6.02 or is otherwise subject to a purchase money debt or a Capitalized Lease Obligation, in each case, as permitted by Section 6.01, if the contract or other agreement providing for such debt or Capitalized Lease Obligation prohibits or requires the consent of any person (other than the Borrower or any Guarantor) as a condition to the creation of any other security interest on such equipment or asset, after giving effect to the applicable anti-assignment provisions of the Uniform Commercial Code or other Requirements of Law, other than proceeds and receivables thereof, the assignment of which is expressly deemed effective under applicable law notwithstanding such prohibition, provided, to the extent any such applicable anti assignments provisions of the Uniform Commercial Code override such anti assignment clause, the Administrative Agent agrees that its Lien on any such equipment or other asset is hereby subordinated to such Lien, (xiv) cash to secure letter of credit reimbursement obligations to the extent such letters of credit are permitted under this Agreement and prohibit the granting of a Lien, (xv) any segregated deposits that constitute Permitted Liens and are prohibited from being subject to other Liens, (xvi) assets sold in compliance with this Agreement to a person who is not a Subsidiary Guarantor, (xvii) assets owned by a Subsidiary Guarantor after the release of the guaranty of such Subsidiary Guarantor pursuant to this Agreement or the Intercreditor Agreement, (xviii) any deposit account that is used for the sole purpose of making payroll and withholding tax

 

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payments related thereto and other employee wage and benefits payments and accrued and unpaid employee compensation payments (including salaries, wages, benefits and expense reimbursements, 401(k) and other retirement plans and employee benefits, including rabbi trusts for deferred compensation and health care benefits), (xix) any Foreign Subsidiary to the extent that such grant of a security interest therein would result in any breach of corporate benefit, financial assistance, capital preservation, fraudulent preference, thin capitalization rules, or any other law or regulation (or analogous restriction) of the jurisdiction of organization of such person or result in any risk to the officers or directors of such person of a civil or criminal liability, (xx) property and assets released in accordance with this Agreement or the Intercreditor Agreement, (xxi) all assets of Holdings other than Equity Interests in the Borrower directly held by Holdings and pledged pursuant to the Holdings Guarantee and Pledge Agreement and (xxii) any other exceptions mutually agreed upon between the Borrower and the Administrative Agent; provided that the Borrower may in its sole discretion elect to exclude any property from the definition of “Excluded Property.”  Notwithstanding anything herein to the contrary, (A) the Administrative Agent may grant extensions of time or waiver of requirement for the creation or perfection of security interests in or the obtaining of insurance (including title insurance) or surveys with respect to particular assets (including extensions beyond the Closing Date for the perfection of security interests in the assets of the Loan Parties on such date) where it reasonably determines, in consultation with the Borrower, that perfection or obtaining of such items cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required by this Agreement or the other Loan Documents, (B) no control agreement or control, lockbox or similar arrangement shall be required with respect to any deposit accounts, securities accounts or commodities accounts, (C) no landlord, mortgagee or bailee waivers shall be required, (D) no foreign-law governed security documents or perfection under foreign law shall be required, (E) no notice shall be required to be sent to account debtors or other contractual third parties prior to an Event of Default, (F) Liens required to be granted from time to time pursuant to, or any other requirements of, the Collateral and Guarantee Requirement and the Security Documents shall be subject to exceptions and limitations set forth in the Security Documents and (G) to the extent any Mortgaged Property is located in a jurisdiction with mortgage recording or similar tax, the amount secured by the Security Document with respect to such Mortgaged Property shall be limited to the Fair Market Value (as determined in good faith by the Borrower) of such Mortgaged Property as determined in good faith by the Borrower (subject to any applicable laws in the relevant jurisdiction or such lesser amount agreed to by the Administrative Agent).

 

SECTION 5.12                                           Rating.  Exercise commercially reasonable efforts to obtain and maintain public ratings (but not to obtain a specific rating) from each of Moody’s and S&P for the Term B Loans.

 

SECTION 5.13              Post-Closing.

 

(a)                                         With respect to each Closing Date Mortgaged Property, cause the Collateral and Guarantee Requirement to be satisfied.

 

(b)                                         Take all necessary actions to satisfy the items described on Schedule 5.13 to the Original Credit Agreement within the applicable period of time specified in such Schedule (or such longer period as the Administrative Agent may agree in its reasonable discretion).

 

ARTICLE VI
 NEGATIVE COVENANTS

 

Each of Holdings (solely with respect to Section 6.08(b)) and the Borrower covenants and agrees with each Lender that, until the Termination Date, unless the Required Lenders shall otherwise consent in writing, Holdings will not (solely with respect to Section 6.08(b)) and the Borrower will not, and will not cause or permit any of the Subsidiaries to:

 

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SECTION 6.01                                           Indebtedness.  Incur, create, assume or permit to exist any Indebtedness, except:

 

(a)                                 (i) Indebtedness existing or committed, or incurred pursuant to facilities existing or committed, on the Closing Date (and contemplated to be existing on the Closing Date under the Business Combination Agreement) (provided that any such Indebtedness that is (x) not intercompany Indebtedness and (y) in excess of $1,000,000 individually and $5,000,000 in the aggregate shall only be permitted under this clause (a) to the extent such Indebtedness is set forth on Schedule 6.01 to the Original Credit Agreement) and (ii) any Permitted Refinancing Indebtedness incurred to Refinance such Indebtedness (other than intercompany Indebtedness Refinanced with Indebtedness owed to a person not affiliated with the Borrower or any Subsidiary) or, without duplication, replacements of such facilities that would constitute Permitted Refinancing Indebtedness with respect to such facilities if all Indebtedness available to be incurred thereunder were outstanding on the date of such replacement;

 

(b)                                 (i) Indebtedness created hereunder (including pursuant to Section 2.20) and under the other Loan Documents and (ii) any Permitted Refinancing Indebtedness incurred to Refinance such Indebtedness;

 

(c)                                  Indebtedness of the Borrower and the Subsidiaries pursuant to Swap Agreements entered into for non-speculative purposes;

 

(d)                                 Indebtedness of the Borrower and the Subsidiaries owed to (including obligations in respect of letters of credit or bank guarantees or similar instruments for the benefit of) any person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance to Holdings, the Borrower or any Subsidiary, pursuant to reimbursement or indemnification obligations to such person, in each case, provided in the ordinary course of business or consistent with past practices or industry practices;

 

(e)                                  Indebtedness of the Borrower to Holdings or any Subsidiary and of any Subsidiary to Holdings, the Borrower or any other Subsidiary; provided that (i) Indebtedness of any Subsidiary that is not a Subsidiary Loan Party owing to Holdings, the Borrower or any Subsidiary Loan Party incurred pursuant to this Section 6.01(e) shall be subject to Section 6.04, and (ii) other than in the case of intercompany current liabilities incurred in the ordinary course of business in connection with the cash management, tax and accounting operations of Holdings, the Borrower and the Subsidiaries, all Indebtedness of the Borrower to any Subsidiary and Indebtedness of any other Loan Party to any Subsidiary that is not a Subsidiary Loan Party incurred pursuant to this Section 6.01(e) shall be subordinated to the Loan Obligations under this Agreement on subordination terms described in the intercompany note substantially in the form of Exhibit H to the Original Credit Agreement, on subordination terms identical to those described in the intercompany note or on other subordination terms reasonably satisfactory to the Administrative Agent and the Borrower;

 

(f)                                   Indebtedness of the Borrower and the Subsidiaries in respect of performance bonds, bid bonds, appeal bonds, surety bonds and completion guarantees and similar obligations, in each case, reasonably required in the conduct of the business (giving effect to any growth or expansion of such business permitted hereunder), including those incurred to secure health, safety, insurance and environmental obligations of the Borrower and its Subsidiaries as conducted in accordance with good and prudent business industry practices and otherwise as permitted by the Loan Documents;

 

(g)                                  Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or other cash management services in the ordinary course of business;

 

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(h)                                 (i)  Indebtedness of a Subsidiary acquired after the Closing Date or a person merged into or consolidated with the Borrower or any Subsidiary after the Closing Date and Indebtedness otherwise incurred or assumed in connection with the acquisition of assets or Equity Interests (including a Permitted Business Acquisition), where such acquisition, merger or consolidation is not prohibited by this Agreement; provided that (w) in the case of any such Indebtedness secured by Liens on Collateral that are Other First Liens, the Net First Lien Leverage Ratio on a Pro Forma Basis immediately after giving effect to such acquisition, merger or consolidation, the incurrence or assumption of such Indebtedness and the use of proceeds thereof and any related transactions is (I) not greater than 3.75 to 1.00 or (II) no greater than the Net First Lien Leverage Ratio in effect immediately prior thereto, (x) in the case of any such Indebtedness secured by Liens on Collateral that are Junior Liens, the Net Secured Leverage Ratio on a Pro Forma Basis immediately after giving effect to such acquisition, merger or consolidation, the incurrence or assumption of such Indebtedness and the use of proceeds thereof and any related transactions is (I) not greater than 4.00 to 1.00 or (II) no greater than the Net Secured Leverage Ratio in effect immediately prior thereto, (y) in the case of any other such Indebtedness, the Interest Coverage Ratio on a Pro Forma Basis immediately after giving effect to such acquisition, merger or consolidation, the incurrence or assumption of such Indebtedness and the use of proceeds thereof and any related transactions is (I) not less than 2.00 to 1.00 or (II) no less than the Interest Coverage Ratio in effect immediately prior thereto and (z) in the case of any such Indebtedness incurred under this clause (h) by a Subsidiary other than a Subsidiary Loan Party (to the extent incurred in contemplation of such acquisition, merger or consolidation), the aggregate outstanding principal amount of such Indebtedness immediately after giving effect to such acquisition, merger or consolidation, the incurrence of such Indebtedness and the use of proceeds thereof and any related transactions shall not exceed the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period; provided, further, that (i) the incurrence (but not assumption) of any Indebtedness for borrowed money pursuant to this clause (h)(i) incurred in contemplation of such acquisition, merger or consolidation (except for any seller note or seller financing) shall be subject to the last paragraph of this Section 6.01 and the incurrence (but not assumption) of any Indebtedness for borrowed money pursuant to this clause (h)(i) in the form of term loan Indebtedness that is secured by Other First Liens shall be subject to the last paragraph of Section 6.02; and (ii) any Permitted Refinancing Indebtedness incurred to Refinance any such Indebtedness;

 

(i)                                     (i)  Capitalized Lease Obligations, mortgage financings and other Indebtedness incurred by the Borrower or any Subsidiary prior to or within 270 days after the acquisition, lease, construction, repair, replacement or improvement of the respective property (real or personal, and whether through the direct purchase of property or the Equity Interest of any person owning such property) permitted under this Agreement in order to finance such acquisition, lease, construction, repair, replacement or improvement, in an aggregate principal amount that immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof would not exceed the greater of $75,000,000 and 0.22 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, (ii) Capitalized Lease Obligations or other obligations or deferrals attributable to capital spending or other funds made available by suppliers in connection with any Sale and Lease-Back Transaction that is permitted under Section 6.03, and (iii) any Permitted Refinancing Indebtedness incurred to Refinance any such Indebtedness in each of clause (i) and clause (ii), as applicable;

 

(j)                                    Indebtedness in connection with Permitted Securitization Financings;

 

(k)                                 (i) other Indebtedness of the Borrower or any Subsidiary, in an aggregate principal amount at any time outstanding that, immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, together with the aggregate principal amount of any other Indebtedness outstanding pursuant to this Section 6.01(k), would not exceed the greater of $100,000,000

 

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and 0.29 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(l)                                     Guarantees (i) by the Borrower or any Subsidiary of any Indebtedness of the Borrower or any Subsidiary permitted to be incurred under this Agreement; provided that, notwithstanding anything to the contrary in this Section 6.01, the Borrower and the Subsidiary Loan Parties shall not Guarantee the Indebtedness of any Subsidiary that is not a Subsidiary Loan Party unless such Guarantee is permitted under Section 6.04 (other than Section 6.04(v)), and (ii) by the Borrower of Indebtedness of Subsidiaries that are not Subsidiary Loan Parties incurred for working capital purposes in the ordinary course of business on ordinary business terms so long as such Indebtedness is permitted to be incurred under Section 6.01(t) to the extent such Guarantees are permitted by Section 6.04 (other than Section 6.04(v)); provided that any Guarantees by the Borrower or any Subsidiary Loan Party under this Section 6.01(l) of any other Indebtedness of a person that is subordinated to other Indebtedness of such person shall be expressly subordinated to the Loan Obligations on terms not less favorable to the Lenders than the subordination terms of such other Indebtedness;

 

(m)                             Indebtedness arising from agreements of the Borrower or any Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than Guarantees of Indebtedness incurred by any person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of financing such acquisition, in each case, to the extent such obligation or transaction is permitted by this Agreement;

 

(n)                                 Indebtedness in respect of letters of credit (other than Letters of Credit issued pursuant to Section 2.05), bank guarantees, warehouse receipts or similar instruments issued to support performance obligations and trade letters of credit (other than obligations in respect of other Indebtedness) in the ordinary course of business or consistent with past practice or industry practices;

 

(o)                                 Indebtedness of the Borrower and the Subsidiaries supported by a Letter of Credit, in a principal amount not in excess of the stated amount of such Letter of Credit (or a letter of credit issued under any other revolving credit or letter of credit facility permitted by Section 6.01);

 

(p)                                 Indebtedness consisting of (x) the financing of insurance premiums or (y) take-or-pay obligations contained in supply arrangements, in each case, in the ordinary course of business;

 

(q)                                 to the extent constituting Indebtedness, all premium (if any), defeasance costs, interest (including post-petition interest), fees, expenses, charges and additional or contingent interest on Indebtedness otherwise permitted to be incurred pursuant to this Section 6.01 or refinancings thereof;

 

(r)                                    Indebtedness incurred in the ordinary course of business in respect of obligations of the Borrower or any Subsidiary to pay the deferred purchase price of goods or services or progress payments in connection with such goods and services; provided that such obligations are incurred in connection with open accounts extended by suppliers on customary trade terms in the ordinary course of business and not in connection with the borrowing of money or any Swap Agreements;

 

(s)                                   deposits raised by any Material Subsidiary that is subject to state and/or federal banking regulations that constitute Indebtedness owing to such depositor and any discounts or borrowing by such Material Subsidiary;

 

(t)                                    (i) Indebtedness of Subsidiaries that are not Loan Parties in an aggregate principal amount at any time outstanding that, immediately after giving effect to the incurrence of such

 

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Indebtedness and the use of proceeds thereof, together with the aggregate principal amount of any other Indebtedness outstanding pursuant to this Section 6.01(t), would not exceed the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(u)                                 Indebtedness consisting of earn-outs and obligations of the Borrower or any Subsidiary under deferred compensation or other similar arrangements incurred by such person in connection with the Transactions and Permitted Business Acquisitions or any other Investment permitted hereunder;

 

(v)                                 (i) Indebtedness secured by Liens on Collateral that are Other First Liens so long as immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, the Net First Lien Leverage Ratio on a Pro Forma Basis is not greater than 3.75  to 1.00; provided that (x) the aggregate principal amount of Indebtedness outstanding under this clause (v)(i) at such time that is incurred by a Subsidiary other than a Subsidiary Loan Party shall not exceed, when taken together with the aggregate principal amount of any other Indebtedness outstanding pursuant to this Section 6.01(v)(i), Section 6.01(w)(i) and Section 6.01(x)(i) that are incurred by Subsidiaries other than the Subsidiary Loan Parties, the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period and (y) the incurrence of any Indebtedness for borrowed money pursuant to this clause (v)(i) shall be subject to the last paragraph of this Section 6.01 and the incurrence of any Indebtedness for borrowed money pursuant to this clause (v)(i) in the form of term loan Indebtedness shall be subject to the last paragraph of Section 6.02, and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(w)                               (i) Indebtedness secured by Liens on Collateral that are Junior Liens so long as immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, the Net Secured Leverage Ratio on a Pro Forma Basis is not greater than 4.00 to 1.00; provided that (x) the aggregate principal amount of Indebtedness outstanding under this clause (w)(i) at such time that is incurred by a Subsidiary other than a Subsidiary Loan Party shall not exceed, when taken together with the aggregate principal amount of any other Indebtedness outstanding pursuant to Section 6.01(v)(i), this Section 6.01(w)(i) and Section 6.01(x)(i) that are incurred by Subsidiaries other than the Subsidiary Loan Parties, the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period and (y) the incurrence of any Indebtedness for borrowed money pursuant to this clause (w)(i) shall be subject to the last paragraph of this Section 6.01, and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(x)                                 (i) other Indebtedness so long as immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, the Interest Coverage Ratio on a Pro Forma Basis is not less than 2.00 to 1.00; provided that (x) the aggregate principal amount of Indebtedness outstanding under this clause (x)(i) at such time that is incurred by a Subsidiary other than a Subsidiary Loan Party shall not exceed, when taken together with the aggregate principal amount of any other Indebtedness outstanding pursuant to Section 6.01(v)(i), Section 6.01(w)(i) and this Section 6.01(x)(i) that are incurred by Subsidiaries other than the Subsidiary Loan Parties, the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period and (y) the incurrence of any Indebtedness for borrowed money pursuant to this clause (x)(i) shall be subject to the last paragraph of this Section 6.01, and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(y)                                 (i) Indebtedness in an aggregate principal amount outstanding not to exceed at the time of incurrence the Incremental Amount available at the applicable time of determination set forth in the definition thereof; provided that the incurrence of term loan Indebtedness pursuant to (x) this clause

 

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(y)(i) shall be subject to the last paragraph of this Section 6.01 and (y) this clause (y)(i) shall be subject to the last paragraph of Section 6.02 and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(z)                                  Indebtedness of the Borrower or any Subsidiary to or on behalf of any joint venture (regardless of the form of legal entity) that is not a Subsidiary arising in the ordinary course of business in connection with the cash management operations (including with respect to intercompany self insurance arrangements) of Holdings, the Borrower and its Subsidiaries;

 

(aa)                          Indebtedness or Disqualified Stock of the Borrower or any Subsidiaries in an aggregate outstanding principal amount not greater than 100.0% of the amount of net cash proceeds received by the Borrower from (x) the issuance or sale of its Qualified Equity Interests or (y) a contribution to its common equity with the net cash proceeds from the issuance and sale by Holdings or a Parent Entity of its Qualified Equity Interests or a contribution to its common equity (in each case, other than proceeds from the sale of Equity Interests to, or contributions from, the Borrower or any of its Subsidiaries), to the extent such net cash proceeds are not included in the Available Free Cash Flow Amount, do not constitute Excluded Contributions, Excluded Equity Proceeds or Permitted Cure Securities (including any Cure Amount);

 

(bb)                          Customer deposits and advance payments received in the ordinary course of business from customers for goods and services purchased in the ordinary course of business;

 

(cc)                            (i) Indebtedness of, incurred on behalf of, or representing Guarantees of Indebtedness of, joint ventures in an aggregate principal amount that, immediately after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, together with the aggregate principal amount of any other Indebtedness outstanding pursuant to this Section 6.01(cc), would not exceed the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, and (ii) any Permitted Refinancing Indebtedness in respect thereof;

 

(dd)                          Obligations in respect of Cash Management Agreements;

 

(ee)                            Refinancing Notes and any Permitted Refinancing Indebtedness incurred in respect thereof;

 

(ff)                              (i) Indebtedness, including in respect of the Senior Secured Notes, in an aggregate principal amount outstanding pursuant to this Section 6.01(ff)(i) not to exceed $1,000,000,000 and (ii) any Permitted Refinancing Indebtedness in respect thereof; and

 

(gg)                            Indebtedness represented by the AGNL Lease and any guarantees thereof.

 

For purposes of determining compliance with this Section 6.01 or Section 6.02, the amount of any Indebtedness denominated in any currency other than Dollars shall be calculated based on customary currency exchange rates in effect, in the case of such Indebtedness incurred (in respect of term Indebtedness) or committed (in respect of revolving Indebtedness) on or prior to the Closing Date, on the Closing Date and, in the case of such Indebtedness incurred (in respect of term Indebtedness) or committed (in respect of revolving Indebtedness) after the Closing Date, on the date on which such Indebtedness was incurred (in respect of term Indebtedness) or committed (in respect of revolving Indebtedness); provided that if such Indebtedness is incurred to refinance other Indebtedness denominated in a currency other than Dollars (or in a different currency from the Indebtedness being refinanced), and such refinancing would cause the applicable Dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such Dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing

 

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Indebtedness does not exceed (i) the outstanding or committed principal amount, as applicable, of such Indebtedness being refinanced plus (ii) the aggregate amount of fees, underwriting discounts, premiums (including tender premiums), defeasance costs, accrued interest and other costs and expenses incurred in connection with such refinancing.

 

Further, for purposes of determining compliance with this Section 6.01, (A) Indebtedness need not be permitted solely by reference to one category of permitted Indebtedness (or any portion thereof) described in Sections 6.01(a) through (hh) (including, for the avoidance of doubt, with respect to the clauses set forth in the definition of “Incremental Amount”) but may be permitted in part under any combination thereof, (B) in the event that an item of Indebtedness (or any portion thereof) meets the criteria of one or more of the categories of permitted Indebtedness (or any portion thereof) described in Sections 6.01(a) through (hh) (including, for the avoidance of doubt, with respect to the clauses set forth in the definition of “Incremental Amount”), the Borrower may, in its sole discretion, classify or reclassify, or later divide, classify or reclassify (as if incurred at such later time), such item of Indebtedness (or any portion thereof) in any manner that complies with this Section 6.01 and will be entitled to only include the amount and type of such item of Indebtedness (or any portion thereof) in one of the above clauses (or any portion thereof) and such item of Indebtedness (or any portion thereof) shall be treated as having been incurred or existing pursuant to only such clause or clauses (or any portion thereof) without giving pro forma effect to such item (or portion thereof) when calculating the amount of Indebtedness that may be incurred, classified or reclassified pursuant to any other clause (or portion thereof); provided that (x) all Indebtedness outstanding on the Closing Date under this Agreement shall at all times be deemed to have been incurred pursuant to clause (b) of this Section 6.01, and (y) all Indebtedness outstanding on the Closing Date under the Senior Secured Notes shall at all times be deemed to have been incurred pursuant to clause (ff) of this Section 6.01, (C) in connection with any commitment to incur Indebtedness under this Section 6.01 (including, for the avoidance of doubt, with respect to the clauses set forth in the definition of “Incremental Amount”), the Borrower or applicable Subsidiary may, pursuant to a certificate of a Responsible Officer delivered to the Administrative Agent at the time of such commitment,  designate such Indebtedness as having occurred on the date of first incurrence of such commitment (such date, the “Deemed Date”), and any related subsequent actual incurrence will be deemed for all purposes under this Agreement to have been incurred on such Deemed Date, including, without limitation, for purposes of calculating usage of any baskets hereunder (if applicable), the Net Total Leverage Ratio, the Net Secured Leverage Ratio, the Net First Lien Leverage Ratio, the Interest Coverage Ratio and EBITDA (and all such calculations on the Deemed Date and thereafter shall be made on a Pro Forma Basis after giving effect to the deemed incurrence and related transactions in connection therewith until such commitment is terminated (either (i) terminated without consummation of such incurrence or related transaction or (ii) terminated in connection with the consummation of the relevant transaction and actual incurrence of such Indebtedness, in which case of this clause (ii), all such calculations will be made on a Pro Forma Basis after giving effect to such actual incurrence and related transactions) and (D) in connection with any Indebtedness incurred pursuant to Section 6.01(h), (v), (w),  net cash proceeds of the Indebtedness incurred at such time shall not be netted against the applicable amount of Consolidated Debt for purposes of such calculation of the Net Secured Leverage Ratio or the Net First Lien Leverage Ratio, as applicable. In addition, with respect to any Indebtedness that was permitted to be incurred hereunder on the date of such incurrence, any Increased Amount of such Indebtedness shall also be permitted hereunder after the date of such incurrence.

 

This Agreement will not treat (1) unsecured Indebtedness as subordinated or junior to secured Indebtedness merely because it is unsecured or (2) senior Indebtedness as subordinated or junior to any other senior Indebtedness merely because it has a junior priority with respect to the same collateral.

 

With respect to any Indebtedness incurred pursuant to Sections 6.01(h)(i) (solely to the extent set forth therein), 6.01(v)(i), 6.01(w)(i), 6.01(x)(i) and 6.01(y)(i), in each case, in the form of term

 

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loans, (A) the final maturity date of any such Indebtedness shall be no earlier than the Term B Facility Maturity Date, (B) the Weighted Average Life to Maturity of such Indebtedness shall be no shorter than the remaining Weighted Average Life to Maturity of the Term B Loans made by the Lenders on the Closing Date and (C) the mandatory prepayment terms, taken as a whole, shall be substantially similar to, or not materially less favorable to the Borrower and its Subsidiaries than, the terms, taken as a whole, applicable to the Term B Loans (except to the extent such terms apply solely to any period after the Term B Facility Maturity Date or are otherwise reasonably acceptable to the Administrative Agent) as determined by the Borrower in good faith.

 

SECTION 6.02                                           Liens.  Create, incur, assume or permit to exist any Lien on any property or assets (including stock or other securities of any person, including the Borrower or any Subsidiary of the Borrower) at the time owned by it or on any income or revenues or rights in respect of any thereof, except the following (collectively, “Permitted Liens”):

 

(a)                                 Liens on property or assets of the Borrower and the Subsidiaries existing on the Closing Date (or created following the Closing Date pursuant to agreements in existence on the Closing Date requiring the creation of such Liens) (provided that any Liens securing Indebtedness in excess of $1,000,000 individually and $5,000,000 in the aggregate shall only be permitted under this clause (a) to the extent such Lien is set forth on Schedule 6.02(a) to the Original Credit Agreement), and any modifications, replacements, renewals or extensions thereof; provided that such Liens shall secure only those obligations that they secure on the Closing Date (and Permitted Refinancing Indebtedness in respect thereof permitted by Section 6.01) and shall not subsequently apply to any other property or assets of the Borrower or any Subsidiary other than (A) after-acquired property that is affixed or incorporated into the property covered by such Lien, and (B) proceeds and products thereof;

 

(b)                                 any Lien created under the Loan Documents (including Liens created under the Security Documents securing obligations in respect of Secured Swap Agreements and Secured Cash Management Agreements) or permitted in respect of any Mortgaged Property by the terms of the applicable Mortgage;

 

(c)                                  any Lien on any property or asset of the Borrower or any Subsidiary securing Indebtedness or Permitted Refinancing Indebtedness permitted by Section 6.01(h) or acquired after the Closing Date in a transaction permitted by this Agreement; provided that (i) such Lien (A) does not apply to any other property or assets of the Borrower or any of the Subsidiaries not securing such Indebtedness or other obligations owing to the same financier as the financier of such Indebtedness or other obligations or to any person to which such financier has assigned such Indebtedness or other obligations, at the date of the acquisition of such property or asset (other than after acquired property subjected to a Lien securing Indebtedness incurred prior to such date and which Indebtedness is permitted hereunder, such Indebtedness owing to the same financier as the financier of such Indebtedness at the date of the acquisition, that require a pledge of after acquired property, it being understood that such requirement shall not be permitted to apply to any property to which such requirement would not have applied but for such acquisition), (ii) in the case of Liens on the Collateral that are (or are intended to be) junior in priority to the Liens securing the Term B Loans, such Liens shall be subject to a Permitted Junior Intercreditor Agreement and (iii) in the case of Liens on the Collateral that are (or are intended to be) pari passu with the Liens on the Collateral securing the Term B Loans, (x) such Liens shall be subject to a Permitted Pari Passu Intercreditor Agreement and (y) any Indebtedness for borrowed money in the form of newly incurred term loans secured by such Liens shall be subject to the last paragraph of this Section 6.02;

 

(d)                                 Liens for Taxes, assessments or other governmental charges or levies not yet delinquent by more than 30 days or that are being contested in compliance with Section 5.03;

 

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(e)                                  Liens imposed by law, such as landlord’s, carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, supplier’s, construction or other like Liens securing obligations that are not overdue by more than 30 days or that are being contested in good faith by appropriate proceedings and in respect of which, if applicable, Holdings, the Borrower or any Subsidiary shall have set aside on its books reserves in accordance with GAAP;

 

(f)                                   (i)  pledges and deposits and other Liens made in the ordinary course of business in compliance with the Federal Employers Liability Act or any other workers’ compensation, unemployment insurance and other social security laws or regulations and deposits securing liability to insurance carriers under insurance or self-insurance arrangements in respect of such obligations and (ii) pledges and deposits and other Liens securing liability for reimbursement or indemnification obligations of (including obligations in respect of letters of credit or bank guarantees for the benefit of) insurance carriers providing property, casualty or liability insurance to Holdings, the Borrower or any Subsidiary;

 

(g)                                  deposits and other Liens to secure the performance of bids, trade contracts (other than for Indebtedness), leases (other than Capitalized Lease Obligations), statutory obligations, surety and appeal bonds, performance and return of money bonds, bids, leases, government contracts, trade contracts, agreements with public utilities, and other obligations of a like nature (including letters of credit in lieu of any such bonds or to support the issuance thereof) incurred by Holdings, the Borrower or any Subsidiary in the ordinary course of business, including those incurred to secure health, safety, insurance and environmental obligations in the ordinary course of business;

 

(h)                                 zoning restrictions, building codes and laws, survey exceptions (or exceptions that an inspection of the Real Property would disclose), easements, trackage rights, leases (other than Capitalized Lease Obligations), licenses, special assessments, rights-of-way, covenants, conditions, restrictions and declarations on or with respect to the use of Real Property, servicing agreements, development agreements, site plan agreements and other similar encumbrances incurred in the ordinary course of business and title defects or irregularities that are of a minor nature and that, in the aggregate, do not interfere in any material respect with the ordinary conduct of the business of the Borrower or any Subsidiary, and any other matters of record approved by or recorded at the direction of the Administrative Agent;

 

(i)                                     Liens securing Indebtedness permitted by Section 6.01(i); provided that such Liens do not apply to any property or assets of the Borrower or any Subsidiary other than the property or assets acquired, leased, constructed, replaced, repaired or improved with such Indebtedness (or the Indebtedness Refinanced thereby) or sold in the applicable Sale and Lease-Back Transaction, and accessions and additions thereto, proceeds and products thereof, customary security deposits and related property; provided, further, that individual financings provided by one lender may be cross-collateralized to other financings provided by such lender (and its Affiliates) (it being understood that with respect to any Liens on the Collateral being incurred under this clause (i) to secure Permitted Refinancing Indebtedness, if Liens on the Collateral securing the Indebtedness being Refinanced (if any) were Junior Liens, then any Liens on such Collateral being incurred under this clause (i) to secure Permitted Refinancing Indebtedness shall also be Junior Liens);

 

(j)                                    Liens arising out of Sale and Lease-Back Transactions permitted under Section 6.03, so long as such Liens attach only to the property sold and being leased in such transaction and any accessions thereto or proceeds thereof and related property;

 

(k)                                 Liens securing judgments that do not constitute an Event of Default under Section 7.01(j);

 

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(l)                                     Liens on non-Collateral assets, so long as such Liens secure obligations permitted under Section 6.01;

 

(m)                             Liens disclosed by the title insurance policies delivered on or subsequent to the Closing Date and pursuant to the Collateral and Guarantee Requirement, Section 5.11 or Schedule 5.13 to the Original Credit Agreement and any replacement, extension or renewal of any such Lien; provided that such replacement, extension or renewal Lien shall not cover any property other than the property that was subject to such Lien prior to such replacement, extension or renewal; provided, further, that the Indebtedness and other obligations secured by such replacement, extension or renewal Lien are permitted by this Agreement;

 

(n)                                 any interest or title of a lessor or sublessor under any leases or subleases entered into by the Borrower or any Subsidiary in the ordinary course of business;

 

(o)                                 Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code in effect in the State of New York or similar provisions in similar codes, statutes or laws in other jurisdictions on items in the course of collection, (ii) attaching to commodity trading accounts, other commodity brokerage accounts or securities incurred in the ordinary course of business, (iii) in favor of banking institutions arising as a matter of law encumbering deposits (including the right of set-off) and which are within the general parameters customary in the banking industry, (iv) encumbering reasonably customary initial deposits and margin deposits and similar Liens attaching to brokerage accounts incurred in the ordinary course of business and not for speculative purposes, (v) in respect of Third Party Funds or (vi) in favor of credit card companies pursuant to agreements therewith;

 

(p)                                 Liens arising solely by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar rights;

 

(q)                                 Liens on goods or inventory the purchase, shipment or storage price of which is financed by a documentary letter of credit, bank guarantee or bankers’ acceptance issued or created for the account of the Borrower or any Subsidiary in the ordinary course of business; provided that such Lien secures only the obligations of the Borrower or such Subsidiaries in respect of such letter of credit, bank guarantee or banker’s acceptance to the extent permitted under Section 6.01;

 

(r)                                    licenses of Intellectual Property and software that are either (i) entered into in the ordinary course of business or, (ii) not material to the conduct of any of the business lines of the Borrower and the Subsidiaries and the value of which does not constitute a material portion of the assets of the Borrower and its Subsidiaries, taken as whole, and such license does not materially interfere with the ordinary course of conduct of the business of the Borrower or any of its Subsidiaries;

 

(s)                                   Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

 

(t)                                    Liens on the assets of a Subsidiary that is not a Loan Party that secure Indebtedness of such Subsidiary that is permitted to be incurred under Section 6.01;

 

(u)                                 Liens solely on any cash earnest money deposits made by the Borrower or any of the Subsidiaries in connection with any letter of intent or purchase agreement in respect of any Investment permitted hereunder;

 

(v)                                 Liens arising out of consignment or similar arrangements for the sale of goods entered into in the ordinary course of business;

 

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(w)                               Liens securing Indebtedness or other obligation (i) of the Borrower or a Subsidiary in favor of the Borrower or any Subsidiary Loan Party and (ii) of any Subsidiary that is not a Loan Party in favor of any Subsidiary that is not a Loan Party;

 

(x)                                 Liens arising from precautionary Uniform Commercial Code financing statements or consignments entered into in connection with any transaction otherwise permitted under this Agreement;

 

(y)                                 Liens that (i) are contractual rights of set-off (and related pledges) (a) relating to the establishment of depository relations with banks and other financial institutions not given in connection with the issuance of Indebtedness or, (b) relating to pooled deposits, sweep accounts, reserve accounts or similar accounts of the Borrower or any Subsidiary to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the Borrower or any Subsidiary, including with respect to credit card charge-backs and similar obligations, or (ii) relate to purchase orders and other agreements entered into with customers, suppliers or service providers of the Borrower or any Subsidiary (a) in the ordinary course of business or (b) in connection with implementation of business optimization programs;

 

(z)                                  Liens (i) on not more than $5,000,000 of deposits securing Swap Agreements entered into for non-speculative purposes and (ii) on cash or Permitted Investments securing Swap Agreements in the ordinary course of business submitted for clearing in accordance with applicable Requirements of Law;

 

(aa)                          Liens securing insurance premium financing arrangements; provided that such Liens are limited to the applicable unearned insurance premiums;

 

(bb)                          Liens to secure cash management services in the ordinary course of business; provided that such Liens are not incurred in connection with, and do not secure, any borrowings or Indebtedness;

 

(cc)                            leases and subleases not constituting Capitalized Lease Obligations of Real Property not material to the conduct of any business line of the Borrower and its Subsidiaries granted to others in the ordinary course of business that do not materially interfere with the ordinary conduct of the business of the Borrower or any of its Subsidiaries;

 

(dd)                          in the case of Real Property that constitutes a leasehold interest, any Lien to which the fee simple interest (or any superior leasehold interest) is subject;

 

(ee)                            Claims Administration Liens;

 

(ff)                              Liens on securities that are the subject of repurchase agreements constituting Permitted Investments under clause (c) of the definition thereof;

 

(gg)                            Liens on cash and Permitted Investments on deposit with Lenders and Affiliates of Lenders securing obligations owing to such persons under any treasury, depository, overdraft or other cash management services agreements or arrangements with Holdings, the Borrower or any of its Subsidiaries;

 

(hh)                          non-consensual Liens (not incurred in connection with borrowed money) on equipment of the Borrower or any of its Subsidiaries granted in the ordinary course of business to the  Borrower’s or such Subsidiary’s client at which such equipment is located;

 

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(ii)                                  Liens in respect of Permitted Securitization Financings that extend only to the assets subject thereto and Equity Interests of Special Purpose Securitization Subsidiaries;

 

(jj)                                Liens with respect to property or assets of any person securing Indebtedness permitted under Section 6.01(cc) (it being understood that with respect to any Liens on the Collateral being incurred under this clause (jj) to secure Permitted Refinancing Indebtedness, if Liens on the Collateral securing the Indebtedness being Refinanced (if any) were Junior Liens, then any Liens on such Collateral being incurred under this clause (jj) to secure Permitted Refinancing Indebtedness shall also be Junior Liens;

 

(kk)                          Liens on Collateral that are Junior Liens, so long as (x) immediately after giving effect to the incurrence of the Indebtedness secured by such Junior Liens and the use of proceeds thereof, the Net Secured Leverage Ratio on a Pro Forma Basis is not greater than 4.00 to 1.00 and (y) such Liens shall be subject to a Permitted Junior Intercreditor Agreement;

 

(ll)                                  Liens on Collateral that are Other First Liens, so long as (x) immediately after giving effect to the incurrence of the Indebtedness secured by such Other First Liens and the use of proceeds thereof, the Net First Lien Leverage Ratio on a Pro Forma Basis is not greater than 3.75 to 1.00 and (y) such Liens shall be subject to a Permitted Pari Passu Intercreditor Agreement; provided that any Indebtedness for borrowed money in the form of term loans secured by such Liens shall be subject to the last paragraph of this Section 6.02;

 

(mm)                  (i) Liens on Collateral that are Other First Liens, so long as such Other First Liens secure Indebtedness permitted by Section 6.01(b), 6.01(h)(i)(w), 6.01(v), 6.01(y), 6.01(ee) or 6.01(ff) (and, in each case, Permitted Refinancing Indebtedness in respect thereof), so long as such Liens shall be subject to a Permitted Pari Passu Intercreditor Agreement and (ii) Liens on the Collateral that are Junior Liens, so long as such Junior Liens secure Indebtedness permitted by Section 6.01(b), 6.01(h)(i)(x), 6.01(w), 6.01(y) or 6.01(ee) (and, in each case, Permitted Refinancing Indebtedness in respect thereof), so long as such Liens shall be subject to a Permitted Junior Intercreditor Agreement;

 

(nn)                          Liens to secure any Indebtedness issued or incurred to Refinance (or successive Indebtedness issued or incurred for subsequent Refinancings) as a whole, or in part, any Indebtedness secured by any Lien permitted by this Section 6.02; provided, however, that (v) with respect to any Liens on the Collateral being incurred under this clause (nn), if Liens on the Collateral securing the Indebtedness being Refinanced (if any) were Junior Liens, then such Liens on such Collateral being incurred under this clause (nn) shall also be Junior Liens, (w) with respect to any Liens on the Collateral being incurred under this clause (nn), if Liens on the Collateral securing the Indebtedness being Refinanced (if any) were Other First Liens, then such Liens on such Collateral being incurred under this clause (nn) may also be Other First Liens or Junior Liens, (x) (other than Liens contemplated by the foregoing clauses (v) and (w)) such new Lien shall be limited to all or part of the same type of property that secured the original Lien (plus improvements on and accessions to such property, proceeds and products thereof, customary security deposits and any other assets pursuant to after-acquired property clauses to the extent such assets secured (or would have secured) the Indebtedness being Refinanced), (y) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (A) the outstanding principal amount (or accreted value, if applicable) or, if greater, committed amount of the applicable Indebtedness at the time the original Lien became a Lien permitted hereunder, (B) unpaid accrued interest and premium (including tender premiums) and (C) an amount necessary to pay any associated underwriting discounts, defeasance costs, fees, commissions and expenses, and (z) on the date of the incurrence of the Indebtedness secured by such Liens, the grantors of any such Liens shall be no different from the grantors of the Liens securing the Indebtedness being Refinanced or grantors that would have been obligated to secure such Indebtedness or a Loan Party;

 

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(oo)                          other Liens with respect to property or assets of the Borrower or any Subsidiary securing obligations in an aggregate outstanding principal amount that, immediately after giving effect to the incurrence of such Liens, would not exceed the greater of $100,000,000 and 0.29 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period;

 

(pp)                          Liens on any amounts held by a trustee or agent under any indenture or other debt agreement issued in escrow pursuant to customary escrow arrangements pending the release thereof, or under any indenture or other debt agreement pursuant to customary discharge, redemption or defeasance provisions; and

 

(qq)                          Liens (i) on Equity Interests in joint ventures (A) securing obligations of such joint venture or (B) pursuant to the relevant joint venture agreement or arrangement and (ii) on Equity Interests in Unrestricted Subsidiaries.

 

For purposes of determining compliance with this Section 6.02, (A) a Lien securing an item of Indebtedness need not be permitted solely by reference to one category of permitted Liens (or any portion thereof) described in Sections 6.02(a) through (qq) but may be permitted in part under any combination thereof and (B) in the event that a Lien securing an item of Indebtedness (or any portion thereof) meets the criteria of one or more of the categories of permitted Liens (or any portion thereof) described in Sections 6.02(a) through (qq), the Borrower may, in its sole discretion, classify or reclassify, or later divide, classify or reclassify (as if incurred at such later time), such Lien securing such item of Indebtedness (or any portion thereof) in any manner that complies with this Section 6.02 and will be entitled to only include the amount and type of such Lien or such item of Indebtedness secured by such Lien (or any portion thereof) in one of the above clauses  and such Lien securing such item of Indebtedness (or portion thereof) will be treated as being incurred or existing pursuant to only such clause or clauses (or any portion thereof) without giving pro forma effect to such item (or portion thereof) when calculating the amount of Liens or Indebtedness that may be incurred pursuant to any other clause (or portion thereof).  In addition, with respect to any commitment to incur Indebtedness that is designated to be incurred on any Deemed Date pursuant to clause (C) of the second paragraph at the end of Section 6.01, any Lien that does or that shall secure such Indebtedness that is otherwise permitted to be incurred hereunder on such Deemed Date may also be designated by the Borrower or any Subsidiary to be incurred on such Deemed Date and, in such event, any related subsequent actual incurrence of such Lien shall be deemed for all purposes under this Agreement to be incurred on such Deemed Date, including for purposes of calculating usage of any Permitted Lien  and any calculations on and after the Deemed Date shall until the termination of such commitments be made on a Pro Forma Basis after giving effect to the deemed incurrence or issuance and related transactions in connection therewith.  In addition, with respect to any Lien securing Indebtedness that was permitted to secure such Indebtedness at the time of the incurrence of such Indebtedness, such Lien shall also be permitted to secure any Increased Amount of such Indebtedness.

 

With respect to (x) Indebtedness incurred in the form of term loans that are secured by Liens on the Collateral that are Other First Liens incurred under Section 6.02(c)(iii)(y) or Section 6.02(ll) or (y) any Indebtedness incurred (but not assumed) in the form of term loans pursuant to Section 6.01(h)(i)(w) or incurred in the form of term loans pursuant to Section 6.01(v)(i) or Section 6.01(y)(i), in each case, that is secured by Liens on the Collateral that are Other First Liens (any such Indebtedness, “Pari Term Loans”), if the All-in Yield in respect of such Pari Term Loans exceeds the All-in Yield in respect of the Term B Loans on the Repricing Effective Date by more than 0.50% (such difference, the “Pari Yield Differential”), then the Applicable Margin (or “LIBOR floor” as provided in the following proviso) applicable to the Term B Loans on the Repricing Effective Date shall be increased such that after giving effect to such increase, the Pari Yield Differential shall not exceed 0.50%; provided that, to the extent any portion of the Pari Yield Differential is attributable to a higher

 

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“LIBOR floor” being applicable to such Pari Term Loans, such floor shall only be included in the calculation of the Pari Yield Differential to the extent such floor is greater than the Adjusted Eurocurrency Rate in effect for an Interest Period of three months’ duration at such time, and, with respect to such excess, the “LIBOR floor” applicable to such outstanding Term B Loans shall be increased to an amount not to exceed the “LIBOR floor” applicable to such Pari Term Loans prior to any increase in the Applicable Margin applicable to such Term B Loans then outstanding.

 

SECTION 6.03                                           Sale and Lease-Back Transactions.  Enter into any arrangement, directly or indirectly, with any person whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter, as part of such transaction, rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property being sold or transferred (a “Sale and Lease-Back Transaction”); provided that a Sale and Lease-Back Transaction shall be permitted (a) with respect to (i) Excluded Property, (ii) property owned by the Borrower or any Subsidiary Loan Party that is acquired after the Closing Date so long as such Sale and Lease-Back Transaction is consummated within 365 days of the acquisition of such property or (iii) property owned by any Subsidiary that is not a Loan Party regardless of when such property was acquired, and (b) with respect to any other property owned by the Borrower or any Subsidiary Loan Party, (x) if such Sale and Lease-Back Transaction is of property owned by the Borrower or any Subsidiary Loan Party as of the Closing Date, the Net Proceeds therefrom are used to prepay the Term Loans to the extent required by Section 2.11(b) and (y) with respect to any Sale and Lease-Back Transaction pursuant to this clause (b) with Net Proceeds in excess of $20,000,000 individually or $100,000,000 in the aggregate in any fiscal year, the requirements of the last paragraph of Section 6.05 shall apply to such Sale and Lease-Back Transaction to the extent provided therein.  Notwithstanding anything herein to the contrary the AGNL Lease and any guarantees thereof shall be permitted.

 

SECTION 6.04                                           Investments, Loans and Advances.  (i) Purchase or acquire (including pursuant to any merger with a person that is not a Wholly Owned Subsidiary immediately prior to such merger) any Equity Interests, evidences of Indebtedness or other securities of any other person, (ii) make any loans or advances to or Guarantees of the Indebtedness of any other person (other than in respect of (A) intercompany liabilities incurred in connection with the cash management, tax and accounting operations of the Borrower and the Subsidiaries and (B) intercompany loans, advances or Indebtedness having a term not exceeding 364 days (inclusive of any roll-overs or extensions of terms) and made in the ordinary course of business or consistent with industry practices), or (iii) purchase or otherwise acquire, in one transaction or a series of related transactions, (x) all or substantially all of the property and assets or business of another person or (y) assets constituting a business unit, line of business or division of such person (each of the foregoing, an “Investment”), except:

 

(a)                                 [reserved];

 

(b)                                 Investments by the Borrower or any Subsidiary in the Equity Interests of the Borrower or any Subsidiary; (ii) intercompany loans from the Borrower or any Subsidiary to the Borrower or any Subsidiary; and (iii) Guarantees by the Borrower or any Subsidiary of Indebtedness otherwise permitted hereunder of the Borrower or any Subsidiary; provided that as at any date of determination, the aggregate outstanding amount (valued at the time of the making thereof and without giving effect to any subsequent change in value) of (A) Investments made after the Closing Date by the Loan Parties pursuant to subclause (i) in Subsidiaries that are not Subsidiary Loan Parties, plus (B) net outstanding intercompany loans made after the Closing Date by the Loan Parties to Subsidiaries that are not Subsidiary Loan Parties pursuant to subclause (ii), plus (C) outstanding Guarantees by the Loan Parties of Indebtedness after the Closing Date of Subsidiaries that are not Subsidiary Loan Parties pursuant to subclause (iii) (excluding for purposes of the calculation in this proviso any Investment made at a time when, immediately after giving effect thereto, the Net Total Leverage Ratio on a Pro Forma

 

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Basis would not exceed 2.72 to 1.00, which Investment shall be permitted under this Section 6.04(b) without regard to such calculation), shall not exceed the sum of (X) the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period plus (Y) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment;

 

(c)                                  Permitted Investments and Investments that were Permitted Investments when made;

 

(d)                                 Investments arising out of the receipt by the Borrower or any Subsidiary of noncash consideration for the Disposition of assets permitted under Section 6.05;

 

(e)                                  (i)  loans and advances to officers, directors, employees or consultants of Holdings, the Borrower or any Subsidiary in the ordinary course of business not to exceed $20,000,000 in the aggregate at any time outstanding (calculated without regard to any subsequent change in value), (ii) advances of payroll payments, business related travel expenses, moving expenses and other similar expenses and expenses to employees in the ordinary course of business and (iii) in connection with such person’s purchase of Equity Interests of Holdings, the Borrower or any Parent Entity solely to the extent that the amount of such loans and advances shall be contributed to the Borrower in cash as common equity;

 

(f)                                   (i)  accounts receivable, security deposits and prepayments arising, and trade credit granted, in the ordinary course of business, (ii) any securities received in satisfaction or partial satisfaction of defaulted accounts receivable from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss and (iii) any prepayments and other credits to suppliers made in the ordinary course of business;

 

(g)                                  Swap Agreements;

 

(h)                                 Investments existing on the Closing Date, or contractually committed as of the Closing Date, and set forth on Schedule 6.04 to the Original Credit Agreement and any extensions, renewals, replacements or reinvestments thereof, so long as the aggregate amount of all Investments pursuant to this clause (h) is not increased at any time above the amount of such Investment existing or committed on the Closing Date (other than pursuant to an increase as required by the terms of any such Investment as in existence on the Closing Date or as otherwise permitted by this Section 6.04);

 

(i)                                     Investments resulting from pledges and deposits referred to in Sections 6.02(f), (g), (k), (s) and (u);

 

(j)                                    other Investments by the Borrower or any Subsidiary in an aggregate outstanding amount (valued at the time of the making thereof, and without giving effect to any subsequent change in value) not to exceed the sum of (X) the greater of $100,000,000 and 0.29 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, plus (Y) any portion of the Available Free Cash Flow Amount on the date of such election that the Borrower elects to apply to this Section 6.04(j)(Y), which such election shall be set forth in a written notice of a Responsible Officer thereof, which notice shall set forth calculations in reasonable detail the amount of Available Free Cash Flow Amount immediately prior to such election and the amount thereof elected to be so applied; provided, that no Event of Default has occurred and is continuing or would result therefrom and after giving effect thereto, and, plus (Z) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment pursuant to clause (X); provided that if any Investment

 

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pursuant to this Section 6.04(j) is made in any person that was not a Subsidiary on the date on which such Investment was made but becomes a Subsidiary thereafter, then such Investment may, at the option of the Borrower, upon such person becoming a Subsidiary and so long as such person remains a Subsidiary, be deemed to have been made pursuant to Section 6.04(b) (to the extent permitted by the proviso thereto in the case of any Subsidiary that is not a Loan Party) and not in reliance on this Section 6.04(j);

 

(k)                                 Investments constituting Permitted Business Acquisitions;

 

(l)                                     Investments consisting of the licensing or contribution of intellectual property pursuant to joint marketing arrangements with other persons;

 

(m)                             intercompany loans and other Investments between Subsidiaries that are not Loan Parties and Guarantees by Subsidiaries that are not Loan Parties permitted by Section 6.01(l);

 

(n)                                 Investments consisting of purchases and acquisitions of inventory, supplies, materials and equipment or purchases of contract rights or licenses or leases of intellectual property in each case in the ordinary course of business;

 

(o)                                 Investments made in connection with the Transactions or pursuant to the Business Combination Agreement;

 

(p)                                 Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with or judgments against, customers and suppliers, in each case in the ordinary course of business or Investments acquired by the Borrower or a Subsidiary as a result of a foreclosure by the Borrower or any of the Subsidiaries with respect to any secured Investments or other transfer of title with respect to any secured Investment in default;

 

(q)                                 Investments of a Subsidiary acquired after the Closing Date or of a person merged into the Borrower or merged into or consolidated with a Subsidiary after the Closing Date, in each case (i) to the extent such acquisition, merger or consolidation is permitted under this Section 6.04, (ii) in the case of any acquisition, merger or consolidation, in accordance with Section 6.05 and (iii) to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation, and were in existence on the date of such acquisition, merger or consolidation;

 

(r)                                    Investments received substantially contemporaneously in exchange for Equity Interests of Holdings or a Parent Entity; provided that (i) no Change in Control would result therefrom, and (ii) such Equity Interests do not constitute Disqualified Stock;

 

(s)                                   Investments in joint ventures; provided that the aggregate outstanding amount (valued at the time of the making thereof and without giving effect to any subsequent change in value) of Investments made after the Closing Date pursuant to this Section 6.04(s) (excluding for purposes of the calculation in this proviso any Investment made at a time when, immediately after giving effect thereto, the Net Total Leverage Ratio on a Pro Forma Basis would not exceed 2.72 to 1.00, which Investment shall be permitted under this Section 6.04(s) without regard to such calculation) shall not exceed the sum of (X) the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, plus (Y) an aggregate amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment; provided that if any Investment pursuant to this Section 6.04(s) is made in any person that was not a Subsidiary on the date on which such Investment was made but becomes a Subsidiary thereafter, then such Investment may, at the option of the Borrower, upon such person becoming a Subsidiary and so long as such person remains a Subsidiary, be deemed to

 

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have been made pursuant to Section 6.04(b) (to the extent permitted by the proviso thereto in the case of any Subsidiary that is not a Loan Party) and not in reliance on this Section 6.04(s);

 

(t)                                    Guarantees by (i) the Borrower or any Subsidiary of operating leases (other than Capitalized Lease Obligations) or of other obligations that do not constitute Indebtedness, in each case, entered into by any Subsidiary Loan Party in the ordinary course of business and (ii) any Subsidiary that is not a Loan Party of operating leases (other than Capitalized Lease Obligations) or of obligations that do not constitute Indebtedness, in each case, entered into by any Subsidiary that is not a Loan Party in the ordinary course of business;

 

(u)                                 Investments made with Excluded Contributions;

 

(v)                                 Guarantees permitted under Section 6.01 (except to the extent such Guarantee is expressly subject to Section 6.04);

 

(w)                               Investments in the ordinary course of business consisting of Uniform Commercial Code Article 3 endorsements for collection or deposit and Uniform Commercial Code Article 4 customary trade arrangements with customers consistent with past practices;

 

(x)                                 advances in the form of a prepayment of expenses, so long as such expenses are being paid in accordance with customary trade terms of the Borrower or such Subsidiary;

 

(y)                                 Investments by the Borrower and its Subsidiaries, including loans and advances to any direct or indirect parent of the Holdings, if the Borrower or any other Subsidiary would otherwise be permitted to make a Dividend in such amount (provided that the amount of any such Investment shall also be deemed to be a Dividend under the appropriate clause of Section 6.06 for all purposes of this Agreement);

 

(z)                                  any Investment (i) deemed to exist as a result of a Subsidiary that is not a Loan Party distributing a note or other intercompany debt to a parent of such Subsidiary that is a Loan Party (to the extent there is no cash consideration or services rendered for such note), and (ii) consisting of intercompany current liabilities in connection with the cash management, tax and accounting operations of Holdings, the Borrower and the Subsidiaries;

 

(aa)                          Investments consisting of Securitization Assets or arising as a result of Permitted Securitization Financings;

 

(bb)                          Investments in Similar Businesses in an aggregate outstanding amount (valued at the time of the making thereof, and without giving effect to any subsequent change in value) not to exceed the sum of (X) the greater of $65,000,000 and 0.19 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, plus (Y) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment; provided that if any Investment pursuant to this Section 6.04(bb) is made in any person that was not a Subsidiary on the date on which such Investment was made but becomes a Subsidiary thereafter, then such Investment may, at the option of the Borrower, upon such person becoming a Subsidiary and so long as such person remains a Subsidiary, be deemed to have been made pursuant to Section 6.04(b) (to the extent permitted by the proviso thereto in the case of any Subsidiary that is not a Loan Party) and not in reliance on this Section 6.04(bb);

 

(cc)                            Investments in any Unrestricted Subsidiaries after giving effect to the applicable Investments, in an aggregate outstanding amount (valued at the time of the making thereof, and without

 

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giving effect to any subsequent change in value) not to exceed the sum of (X) the greater of $45,000,000 and 0.13 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period, plus (Y) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment; provided that if any Investment pursuant to this Section 6.04(cc) is made in any person that was not a Subsidiary on the date on which such Investment was made but becomes a Subsidiary thereafter, then such Investment may, at the option of the Borrower, upon such person becoming a Subsidiary and so long as such person remains a Subsidiary, be deemed to have been made pursuant to Section 6.04(b) (to the extent permitted by the proviso thereto in the case of any Subsidiary that is not a Loan Party) and not in reliance on this Section 6.04(cc);

 

(dd)                          Investments in Subsidiaries that are not Loan Parties in an aggregate outstanding amount (valued at the time of the making thereof and without giving effect to any subsequent change in value) not to exceed the sum of (x) the greater of $40,000,000 and 0.12 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period in the aggregate plus (y) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of Investments theretofore made pursuant to this Section 6.04(dd) (excluding for purposes of this calculation any Investment made at a time when, immediately after giving effect thereto, the Net Total Leverage Ratio on a Pro Forma Basis would not exceed 2.72 to 1.00, which Investment shall be permitted under this Section 6.04(dd) without regard to such calculation);

 

(ee)                            other Investments so long as, immediately after giving effect to such Investment on a Pro Forma Basis, the Net Total Leverage Ratio would not exceed 2.72 to 1.00;

 

(ff)                              Investments consisting of Dividends permitted under Section 6.06;

 

(gg)                            [reserved];

 

(hh)                          Investments to the extent that payment for such Investments is made with Equity Interests of the Borrower, Holdings or any Parent Entity; provided that the issuance of such Equity Interests are not included in any determination of Available Free Cash Flow Amount; and

 

The amount of Investments that may be made at any time pursuant to Section 6.04(b), 6.04(j) or 6.04(bb) (such Sections, the “Related Sections”) may, at the election of the Borrower, be increased by the amount of Investments that could be made at such time under the other Related Section; provided that the amount of each such increase in respect of one Related Section shall be treated as having been used under the other Related Section.

 

Any Investment in any person other than the Borrower or a Subsidiary Loan Party that is otherwise permitted by this Section 6.04 may be made through intermediate Investments in Subsidiaries that are not Loan Parties and such intermediate Investments shall be disregarded for purposes of determining the outstanding amount of Investments pursuant to any clause set forth above.  The amount of any Investment made other than in the form of cash or cash equivalents shall be the Fair Market Value thereof (as determined in good faith by the Borrower) valued at the time of the making thereof, and without giving effect to any subsequent change in value of the making thereof, and without giving effect to any subsequent change in value.

 

SECTION 6.05                                           Mergers, Consolidations, Sales of Assets and Acquisitions.  Merge into or consolidate with any other person, or permit any other person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or any part of its assets (whether

 

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now owned or hereafter acquired), or Dispose of any Equity Interests of any Subsidiary or purchase, lease or otherwise acquire (in one transaction or a series of related transactions) all of any division, unit or business of any other person, except that this Section 6.05 shall not prohibit:

 

(a)                                 (i) the purchase and Disposition of inventory or the sale of receivables pursuant to non-recourse factoring arrangements, in each case in the ordinary course of business by the Borrower or any Subsidiary, (ii) the acquisition or lease (pursuant to an operating lease) of any other asset in the ordinary course of business by the Borrower or any Subsidiary or, with respect to operating leases, otherwise for Fair Market Value on market terms (as determined in good faith by the Borrower), (iii) the Disposition of surplus, obsolete, damaged or worn out equipment or other property in the ordinary course of business by the Borrower or any Subsidiary or determined in good faith by the Borrower to be no longer useful or necessary in the operation of the business of the Borrower or of any of the Subsidiaries, (iv) assignments by the Borrower and any Subsidiary in connection with insurance arrangements of their rights and remedies under, and with respect to, the Business Combination Agreement in respect of any breach by the Company of its representations and warranties set forth therein, (v) the Disposition of Permitted Investments in the ordinary course of business or (vi) any dispositions of Investments in joint ventures to the extent required by, or made pursuant to buy/sell arrangements between the joint venture parties set forth in joint venture arrangements and similar binding arrangements;

 

(b)                                 if at the time thereof and immediately thereafter no Event of Default shall have occurred and be continuing or would result therefrom, (i) the merger or consolidation of any Subsidiary into or with the Borrower in a transaction in which the Borrower is the survivor, (ii) the merger or consolidation of any Domestic Subsidiary into or with any Subsidiary Loan Party in a transaction in which the surviving or resulting entity is or becomes a Subsidiary Loan Party and, in the case of each of clauses (i) and (ii), no person other than the Borrower or Subsidiary Loan Party receives any consideration (unless otherwise permitted by Section 6.04), (iii) the merger or consolidation of any Subsidiary that is not a Subsidiary Loan Party into or with any other Subsidiary that is not a Subsidiary Loan Party, (iv) the liquidation or dissolution or change in form of entity of any Subsidiary (other than the Borrower) if the Borrower determines in good faith that such liquidation, change in form or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary may merge, consolidate or amalgamate into or with any other person in order to effect an Investment permitted pursuant to Section 6.04 so long as the continuing or surviving person shall be a Subsidiary (unless otherwise permitted by Section 6.04), which shall be a Loan Party if the merging, consolidating or amalgamating Subsidiary was a Loan Party (unless otherwise permitted by Section 6.04) and which together with each of its Subsidiaries shall have complied with any applicable requirements of Section 5.11 or (vi) any Subsidiary may merge or consolidate with any other person in order to effect an Asset Sale otherwise permitted pursuant to this Section 6.05;

 

(c)                                  Dispositions to the Borrower or a Subsidiary (upon voluntary liquidation or otherwise),  provided, that any Dispositions by a Loan Party to a Subsidiary that is not a Subsidiary Loan Party in reliance of this clause (c) shall be made in compliance with Section 6.04;

 

(d)                                 Sale and Lease-Back Transactions permitted by Section 6.03;

 

(e)                                  (i) Investments permitted by Section 6.04, Permitted Liens and Dividends permitted by Section 6.06 and (ii) any Disposition made pursuant to the Business Combination Agreement or in connection with the Transactions;

 

(f)                                   any swap of assets in exchange for services or other assets used or useful in a Similar Business of comparable or greater value or usefulness to the business of the Borrower and the Subsidiaries as a whole, as determined in good faith by the management of the Borrower, which in the

 

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event of a swap with a Fair Market Value (as determined in good faith by the Borrower) in excess of (x) $10,000,000 shall be evidenced by a certificate from a Responsible Officer of the Borrower and (y) $20,000,000 shall be set forth in a resolution approved in good faith by at least a majority of the Board of Directors of the Borrower;

 

(g)                                  Dispositions of defaulted receivables in the ordinary course of business and not as part of an accounts receivables financing transaction;

 

(h)                                 Dispositions of assets not otherwise permitted by this Section 6.05; provided that the Net Proceeds thereof, if any, are applied in accordance with Section 2.11(b) to the extent required thereby;

 

(i)                                     Permitted Business Acquisitions (including any merger, consolidation or amalgamation in order to effect a Permitted Business Acquisition); provided that, following any such merger, consolidation or amalgamation involving the Borrower, the Borrower is the surviving entity;

 

(j)                                    licenses of Intellectual Property and software that are either (i) entered into in the ordinary course of business or, (ii) not material to the conduct of any of the business lines of the Borrower and the Subsidiaries and the value of which does not constitute a material portion of the assets of the Borrower and the Subsidiaries, taken as a whole, and which do not materially interfere with the ordinary course of conduct of the business of the Borrower or any of its Subsidiaries;

 

(k)                                 the lease, assignment or sublease of any real or personal property in the ordinary course of business;

 

(l)                                     Dispositions of inventory, equipment or other assets (excluding Equity Interests, assets constituting a business division, unit, line of business, all or substantially all of the assets of any Material Subsidiary, Sale and Lease-Back Transactions and receivables) of the Borrower and the Subsidiaries determined in good faith by the management of the Borrower to be no longer useful or necessary in the operation of the business of the Borrower or any of the Subsidiaries;

 

(m)                             any sale of Equity Interests in, or other securities of, an Unrestricted Subsidiary;

 

(n)                                 the purchase and Disposition (including by capital contribution) of (i) Securitization Assets including pursuant to Permitted Securitization Financings and (ii) any other Securitization Assets subject to Liens securing Permitted Securitization Financing;

 

(o)                                 to the extent constituting a Disposition, any termination, settlement or extinguishment of Swap Obligations; and

 

(p)                                 any sale, transfer or disposition of Claims Administration Investments; provided that the Net Proceeds thereof received by any Loan Party are used to make additional Claims Administration Investments or to repay any outstanding Claims Administration Indebtedness prior to being used for any other purpose.

 

Notwithstanding anything to the contrary contained in Section 6.05 above, (i) no Disposition of assets under Section 6.05(h) or, solely with respect to Sale and Lease-Back Transactions referred to in clause (b)(y) of Section 6.03, under Section 6.05(d), shall be permitted unless (i) such Disposition is for Fair Market Value (as determined in good faith by the Borrower), or if not for Fair Market Value (as determined in good faith by the Borrower), the shortfall is permitted as an Investment under Section 6.04, and (ii) at least 75% of the proceeds of such Disposition (except to Loan Parties)

 

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consist of cash or Permitted Investments; provided that the provisions of this clause (ii) shall not apply to any individual transaction or series of related transactions involving assets with a Fair Market Value (as determined in good faith by the Borrower) of less than $5,000,000; provided, further, that, for purposes of this clause (ii), (a) the amount of any liabilities of the Borrower or any Subsidiary (as shown on the Borrower’s or such Subsidiary’s most recent balance sheet or in the notes thereto) (other than liabilities that are by their terms subordinated to the Loan Obligations) that are assumed by the transferee of any such assets or are otherwise cancelled in connection with such transaction, (b) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary from such transferee that are converted by the Borrower or such Subsidiary into cash within 180 days of the receipt thereof (to the extent of the cash received), (c) any Designated Noncash Consideration received by the Borrower or any of its Subsidiaries in such Disposition having an aggregate Fair Market Value (as determined in good faith by the Borrower), taken together with all other Designated Noncash Consideration received pursuant to this clause (c) since the Closing Date that is at the time outstanding, not to exceed the greater of $65,000,000 and 0.19 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period (with the Fair Market Value (as determined in good faith by the Borrower) of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value), (d) the amount of Indebtedness of any Subsidiary that is no longer a Subsidiary as a result of such Asset Sale, to the extent that Holdings, the Borrower and each other Subsidiary are released from any guarantee of payment of such Indebtedness in connection with the Asset Sale and (e) consideration consisting of Indebtedness of the Borrower (other than Indebtedness that is subordinated in right of payment to the Loan Obligations) received from persons who are not Holdings, the Borrower or a Subsidiary in connection with the Asset Sale  and that is canceled.  To the extent any Collateral is Disposed of in a transaction permitted by this Section 6.05 to any person other than the Borrower or any Subsidiary Loan Party, such Collateral shall be Disposed of free and clear of the Liens created by the Loan Documents (provided that, for the avoidance of doubt, with respect to any Disposal consisting of an operating lease or license, the underlying property retained by the Borrower or such Subsidiary Loan Party will not be so released), and the Collateral Agent shall take, and is hereby authorized by each Lender to take, any actions reasonably requested by the Borrower in order to evidence the foregoing.

 

SECTION 6.06                                           Dividends and Distributions.  Declare or pay, directly or indirectly, any dividend or make, directly or indirectly, any other distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, with respect to any of its Equity Interests (other than dividends and distributions on Equity Interests payable solely by the issuance of additional Qualified Equity Interests of the person paying such dividends or distributions) or directly or indirectly redeem, purchase, retire or otherwise acquire for value (or permit any Subsidiary to purchase or acquire) any of the Borrower’s Equity Interests or set aside any amount for any such purpose (other than through the issuance of additional Equity Interests of the person redeeming, purchasing, retiring or acquiring such shares) (any of the foregoing dividends, distributions, redemptions, repurchases, retirements, other acquisitions or setting aside of amounts, “Dividends”); provided, however, that:

 

(a)                                 (i)  any Subsidiary may declare and pay dividends to, or make other distributions to, the Borrower or any Subsidiary that is a direct or indirect parent of such Subsidiary and, if not a Wholly Owned Subsidiary, to each other owner of Equity Interests of such Subsidiary on a pro rata basis (or more favorable basis from the perspective of the Borrower or such Subsidiary) based on their relative ownership interests; and (ii) to the extent permitted by Section 6.04, any Subsidiary that is not a Wholly Owned Subsidiary may repurchase its Equity Interests from any owner of the Equity Interests of such Subsidiary that is not the Borrower or a Subsidiary;

 

(b)                                 Dividends may be made in respect of (i) overhead, legal, accounting and other professional fees and expenses of Holdings or any Parent Entity, (ii) fees and expenses related to any

 

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public offering or private placement of Equity Interests or Indebtedness of Holdings or any Parent Entity whether or not consummated, (iii) franchise and similar taxes and other fees and expenses in connection with the maintenance of its (or any Parent Entity’s) existence and its (or any Parent Entity’s indirect) ownership of the Borrower, (iv) payments permitted by Section 6.07 (other than Sections 6.07(viii) or (x)), (v) in respect of any taxable period for which the Borrower (or if the Borrower is a disregarded entity for U.S. federal income tax purposes that is wholly owned (directly or indirectly) by a C corporation for U.S. federal and/or applicable state, local or foreign income tax purposes, such C corporation) and/or any of its Subsidiaries are members of a consolidated, combined, affiliated, unitary or similar tax group for U.S. federal and/or applicable state, local or foreign tax purposes of which a direct or indirect parent of the Borrower is the common parent, Dividends to any such direct or indirect parent of the Borrower to fund income taxes for which such parent is liable in an amount not to exceed the amount of any U.S. federal, state, local or foreign income taxes that the Borrower and/or its Subsidiaries, as applicable, would have paid for such taxable period (taking into account prior year losses) had the Borrower and/or its Subsidiaries, as applicable, been a stand-alone corporate taxpayer or a stand-alone corporate group, and (vi) customary salary, bonus and other benefits payable to, and indemnities provided on behalf of, officers, directors, employees and consultants of Holdings or any Parent Entity, in each case in order to permit Holdings or any Parent Entity to make such payments; provided that in the case of subclauses (i) and (iii), the amount of such Dividends shall not exceed the portion of any amounts referred to in such subclauses (i) and (iii) that are allocable to the Borrower and its Subsidiaries (which (x) shall be 100% at any time that, as the case may be, (1) Holdings owns no material assets other than the Equity Interests in the Borrower and assets incidental to such equity ownership or (2) any Parent Entity owns directly or indirectly no material assets other than Equity Interests in Holdings and any other Parent Entity and assets incidental to such equity ownership and (y) in all other cases shall be as determined in good faith by the Borrower);

 

(c)                                  Dividends to Holdings or any Parent Entity in order to enable Holdings or any Parent Entity to purchase or redeem Equity Interests of Holdings or any Parent Entity (including related stock appreciation rights or similar securities) held by then present or former directors, consultants, officers or employees of any Parent Entity, Holdings, the Borrower or any of the Subsidiaries or by any Plan or any shareholders’ agreement then in effect upon such person’s death, disability, retirement or termination of employment or under the terms of any such Plan or any other agreement under which such shares of stock or related rights were issued; provided that the aggregate amount of Dividends for such purchases or redemptions under this Section 6.06(c) shall not exceed (i) in any fiscal year (A) $7,500,000 (plus any amounts carried over from prior years, up to $15,000,000 in the aggregate) plus (B) Excluded Equity Proceeds, which, if not used in any fiscal year, may be carried forward to any subsequent fiscal year, and (ii) amounts received in respect of key man life insurance policy proceeds; provided, further, that cancellation of Indebtedness owing to Holdings, the Borrower or any Subsidiary from members of management of Holdings, any Parent Entity, the Borrower or its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any Parent Entity will not be deemed to constitute a Dividend for purposes of this Section 6.06;

 

(d)                                 any person may make noncash repurchases of Equity Interests deemed to occur upon exercise of stock options if such Equity Interests represent a portion of the exercise price of such options;

 

(e)                                  so long as no Event of Default has occurred and is continuing, other Dividends may be made in an aggregate amount with all other Dividends and other distributions made pursuant to this clause (e) not to exceed the greater of $50,000,000 and 0.15 times the EBITDA calculated on a Pro Forma Basis for the Test Period ended immediately prior to the date of such Dividend;

 

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(f)                                   any person may make distributions to minority shareholders of any subsidiary that is acquired pursuant to a Permitted Business Acquisition pursuant to appraisal or dissenters’ rights with respect to shares of such subsidiary held by such shareholders;

 

(g)                                  [reserved];

 

(h)                                 Dividends may be made in an aggregate amount equal to a portion of the Available Free Cash Flow Amount on the date of such election that the Borrower elects to apply to this Section 6.06(h), which such election shall (unless such Dividend is made pursuant to clause (a) of the definition of “Available Free Cash Flow Amount”) be set forth in a written notice of a Responsible Officer of the Borrower, which notice shall set forth calculations in reasonable detail the amount of Available Free Cash Flow Amount immediately prior to such election and the amount thereof elected to be so applied; provided that no Event of Default has occurred and is continuing and after giving effect thereto, the Net Total Leverage Ratio on a Pro Forma Basis shall not be greater than 3.72 to 1.00;

 

(i)                                     the Borrower or any Subsidiary may make any Dividend on the Closing Date used to fund the Transactions and the fees and expenses related thereto or made in connection with the consummation of the Transactions (including payments made pursuant to or as contemplated by the Transaction Documents, as in effect on the Closing Date);

 

(j)                                    the Borrower or any Subsidiary may make payments of cash, or dividends, distributions or advances to allow such person to make payments of cash, in lieu of the issuance of fractional shares upon exercise of options or warrants or upon the conversion or exchange of Equity Interests of such person;

 

(k)                                 the Borrower may make Dividends to Holdings so that Holdings or any Parent Entity may make Dividends to its equity holders in an aggregate amount not to exceed $25,000,000 per annum;

 

(l)                                     the Borrower may make Dividends to Holdings or any Parent Entity to finance any Investment that if made by the Borrower or any Subsidiary directly would be permitted to be made pursuant to Section 6.04; provided that (A) such Dividend shall be made substantially concurrently with the closing of such Investment and (B) Holdings or such Parent Entity shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) to be contributed to the Borrower or a Subsidiary Loan Party (or, to the extent permitted by Section 6.04, a Subsidiary) or (2) the merger, consolidation or amalgamation (to the extent permitted in Section 6.05) of the person formed or acquired into the Borrower or a Subsidiary in order to consummate such Permitted Business Acquisition or Investment, in each case, in accordance with the requirements of Section 5.11;

 

(m)                             [reserved];

 

(n)                                 the declaration and payment of dividends or distributions to holders of any class or series of Disqualified Stock of the Borrower or any of its Subsidiaries issued or incurred in accordance with Section 6.01;

 

(o)                                 Dividends that are made with Excluded Contributions;

 

(p)                                 Dividends in amounts required for Parent Entity of the Borrower to pay interest and/or principal on Indebtedness the proceeds of which have been contributed to the common equity of Borrower and that has been guaranteed by, or is otherwise considered Indebtedness of, the Borrower incurred in accordance with Section 6.01;

 

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(q)                                 other Dividends so long as, immediately after giving effect to such payment or distribution on a Pro Forma Basis, the Net Total Leverage Ratio is not greater than 2.47 to 1.00; provided that no Event of Default has occurred and is continuing; and

 

(r)                                    any consideration, payment, dividend, distribution or other transfer in connection with a Permitted Securitization Financing.

 

Notwithstanding anything herein to the contrary, the foregoing provisions of Section 6.06 will not prohibit the payment of any Dividend or the consummation of any redemption, purchase, defeasance or other payment within 60 days after the date of declaration thereof or the giving of notice, as applicable, if at the date of declaration or the giving of such notice such payment would have complied with the provisions of this Agreement.

 

SECTION 6.07                                           Transactions with Affiliates.  Sell or transfer any property or assets to, or purchase or acquire any property or assets from, or otherwise engage in any other transaction with, any of its Affiliates in a transaction involving aggregate consideration in excess of $10,000,000, unless such transaction is (i) otherwise permitted (or required) with such Affiliates under this Agreement or (ii) upon terms that are substantially no less favorable to the Borrower or such Subsidiary, as applicable, than would be obtained in a comparable arm’s-length transaction with a person that is not an Affiliate, as determined by the Board of Directors of the Borrower or such Subsidiary in good faith; provided that this clause (ii) shall not apply to (A) the indemnification of directors of Holdings, the Borrower or the Subsidiaries in accordance with customary practice or (B) to the extent otherwise permitted under this Agreement (each of which shall not be prohibited by this Section 6.07), the following:

 

(i)                                     any issuance of securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, equity purchase agreements, deferred compensation agreements, stock options and stock ownership plans or similar employee benefit plans approved by the Board of Directors of Holdings (or any Parent Entity) or of the Borrower;

 

(ii)                                  [reserved];

 

(iii)                               transactions among Holdings, the Borrower and the Subsidiaries (or entities that become Subsidiaries as a result of such transaction (including via merger, consolidation or amalgamation in which a Subsidiary is the surviving entity) that are not otherwise prohibited under this Agreement;

 

(iv)                              the payment of fees, out of pocket costs and indemnities to directors, officers, employees and consultants of any Parent Entity, Holdings, the Borrower and the Subsidiaries in the ordinary course of business (limited, in the case of any Parent Entity or Holdings, to the portion of such fees and expenses that are allocable to the Borrower and its Subsidiaries (which (x) shall be 100% for so long as Holdings or such Parent Entity, as the case may be, owns no assets other than the Equity Interests in the Borrower, Holdings or any Parent Entity and assets incidental to the ownership of the Borrower and its Subsidiaries and (y) in all other cases shall be as determined in good faith by management of the Borrower));

 

(v)                                 the existence of, or the performance by the Borrower or any of its Subsidiaries of its obligations under the terms of, the Transaction Documents, agreements and arrangements in existence on the Closing Date and, to the extent involving aggregate consideration in excess of $5,000,000, set forth on Schedule 6.07 to the Original Credit Agreement and any amendment thereto or similar agreements which it may enter into thereafter;

 

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provided, however, that the existence of, or the performance by the Borrower or any of its Subsidiaries of its obligations under, any future amendment to any such existing agreement or under any similar agreement entered into after the Closing Date shall only be permitted by this clause (v) to the extent that the terms of any such existing agreement together with all amendments thereto, taken as a whole, or new agreement are not otherwise more disadvantageous to the Lenders in any material respect than the original agreement as in effect on the Closing Date (as determined by the Borrower in good faith);

 

(vi)                              transactions to effect the Transactions and the Repricing Date Transactions and the payment of all fees and expenses related to the Transactions as contemplated by the Transaction Documents and the Repricing Date Transactions;

 

(vii)                           (A) any employment agreements entered into by Holdings, the Borrower or any of the Subsidiaries in the ordinary course of business, (B) any subscription agreement or similar agreement pertaining to the repurchase of Equity Interests pursuant to put/call rights or similar rights with employees, officers or directors, and (C) any employee compensation, benefit plan or arrangement, any health, disability or similar insurance plan which covers employees, and any reasonable employment contract or collective bargaining agreement or similar contract and transactions pursuant thereto;

 

(viii)                        transactions permitted by, and complying with, the provisions of, Section 6.04;

 

(ix)                              transactions permitted by, and complying with, the provisions of, Section 6.05;

 

(x)                                 transactions permitted by, and complying with the provisions of, Section 6.06;

 

(xi)                              any purchase by the Permitted Holders or any director, officer, employee or consultant of the Borrower or Holdings of Equity Interests of Holdings or any contribution by Holdings to, or purchases of, Equity Interests of the Borrower; provided that any Equity Interests of the Borrower purchased by Holdings shall be pledged to the Collateral Agent on behalf of the Lenders to the extent required by the Holdings Guarantee and Pledge Agreement;

 

(xii)                           provided no Default or Event of Default shall have occurred and be continuing or would result therefrom, payments by the Borrower or any of the Subsidiaries to the Investors or any Investor Affiliate made for any financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, including in connection with acquisitions or divestitures, which payments are approved by the majority of the Board of Directors of the Borrower, in good faith;

 

(xiii)                        payments, loans (or cancellation of loans) or advances to employees or consultants that are (A) approved by a majority of the Board of Directors of the Borrower in good faith, (B) made in compliance with applicable law and (C) otherwise permitted under this Agreement;

 

(xiv)                       transactions for the purchase or sale of goods, equipment, products, parts and services entered into in the ordinary course of business;

 

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(xv)                          any transaction in respect of which the Borrower delivers to the Administrative Agent (for delivery to the Lenders) a letter addressed to the Board of Directors of the Borrower from an accounting, appraisal or investment banking firm, in each case of nationally recognized standing that is in the good faith determination of the Borrower qualified to render such letter, which letter states that such transaction is on terms that are substantially no less favorable to the Borrower or such Subsidiary, as applicable, than would be obtained in a comparable arm’s-length transaction with a person that is not an Affiliate;

 

(xvi)                       the payment of all fees, expenses, bonuses and awards related to the Transactions, including fees to any Investor or Investor Affiliate;

 

(xvii)                    transactions with customers, clients, suppliers, or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise in compliance with the terms of this Agreement that are fair to the Borrower or the Subsidiaries (in the good faith determination of the Borrower);

 

(xviii)                 transactions with joint ventures for the purchase or sale of goods, equipment and services entered into in the ordinary course of business and in a manner consistent with past practice;

 

(xix)                       transactions between Holdings, the Borrower or any of its Subsidiaries and any person that is an Affiliate solely by virtue of having a director who is also a director of Holdings, the Borrower or any direct or indirect parent company of the Borrower, provided, however, that such director abstains from voting as a director of Holdings or the Borrower or such direct or indirect parent company, as the case may be, on any matter involving such other person;

 

(xx)                          intercompany transactions for the purpose of improving the consolidated tax efficiency of the Borrower and the Subsidiaries;

 

(xxi)                       the termination of HandsOn Management Agreements and any payments for termination fees in connection therewith, including any net present value of future payments;

 

(xxii)                    [reserved];

 

(xxiii)                 payments by Holdings (or any Parent Entity), the Borrower and the Subsidiaries pursuant to a tax sharing agreement or arrangement (whether written or as a matter of practice) that are permitted by clause (v) of Section 6.06(b);

 

(xxiv)                any agreements or arrangements between a third party and an Affiliate of the Borrower that are acquired or assumed by the Borrower or any Subsidiary in connection with an acquisition or merger of such third party (or assets of such third party) by or with the Borrower or any Subsidiary; provided that (A) such acquisition or merger is permitted under this Agreement and (B) such agreements or arrangements are not entered into in contemplation of such acquisition or merger or otherwise for the purpose of avoiding the restrictions imposed by this Section 6.07;

 

(xxv)                   any contribution to the capital of the Borrower, or purchase of Equity Interests of the Borrower, by Holdings;

 

(xxvi)                Investments by the Investors and Investor Affiliates in securities of Holdings, the Borrower or any of the Subsidiaries so long as (A) the Investment is being offered

 

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generally to other investors on the same or more favorable terms and (B) the Investment constitutes less than 5.0% of the outstanding issue amount of such class of securities; and

 

(xxvii)             transactions pursuant to any Permitted Securitization Financing.

 

SECTION 6.08                                           Business of Holdings, the Borrower and the Subsidiaries.  Notwithstanding any other provisions hereof, engage at any time to any material respect in any business or business activity other than:

 

(a)                                 in the case of the Borrower and any Material Subsidiary, (i) any business or business activity conducted by any of them on the Closing Date and any business or business activities incidental or related thereto, (ii) any business or business activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof or ancillary thereto, including the consummation of the Transactions, (iii) any business or business activity that the senior management of the Borrower deems beneficial for the Borrower or such Subsidiary, (iv) any business or business activity of any person acquired pursuant to a Permitted Business Acquisition, (v) any Similar Business and (vi) in the case of a Special Purpose Securitization Subsidiary, Permitted Securitization Financings; and

 

(b)                                 in the case of Holdings, (i) ownership of the Equity Interests in the Borrower, together with activities directly related thereto, and (A) Holdings shall own no assets other than such Equity Interests, Equity Interests of acquired target companies, which shall be immediately contributed to the Borrower, its books and records, deposit accounts, all cash deposits held therein, and cash paid to Holdings in accordance with the terms hereof, and (B) Holdings shall not grant a Lien on any of its assets other than Liens created pursuant to the Loan Documents (or pursuant to documentation governing any Pari Term Loans) and ordinary course Liens incurred under customary deposit account agreements entered into by Holdings with respect to its deposit accounts; (ii) performance of its obligations under and in connection with the Loan Documents, the Business Combination Agreement and the other agreements contemplated by the Business Combination Agreement; (iii) issuance of Equity Interests; (iv) as otherwise required by law; (v) holding any cash received in accordance with the terms hereof and investing such proceeds in Permitted Investments; (vi) guarantees of the AGNL Lease; and (vii) any activities reasonably related to the activities set forth in clauses (i) through (v) above.  Notwithstanding anything contained in this clause (b), so long as no Default has occurred and is continuing or would result therefrom, Holdings may merge with any other person (and if it is not the survivor of such merger, the survivor shall assume Holdings’ obligations, as applicable, under the Loan Documents).

 

SECTION 6.09                                           Limitation on Modifications and Payments of Indebtedness; Modifications of Certificate of Incorporation, By-Laws and Certain Other Agreements; etc.

 

(a)                                 Amend or modify in any manner materially adverse to the Lenders when taken as a whole (as determined in good faith by the Borrower), or grant any waiver or release under or terminate in any manner (if such granting or termination shall be materially adverse to the Lenders when taken as a whole (as determined in good faith by the Borrower)), the articles or certificate of incorporation, by-laws, limited liability company operating agreement or other organizational documents of the Borrower or any of the Subsidiaries.

 

(i)  Make, or agree or offer to pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property) of, or in respect of, principal of or interest on any Junior Financing, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination in respect of any Junior Financing, except for (A) Refinancings with any Indebtedness permitted to be incurred under

 

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Sections 6.01, (B) payments of regularly scheduled interest and fees due thereunder, other non-accelerated and non-principal payments thereunder, scheduled payments thereon necessary to avoid the Junior Financing from constituting “applicable high yield discount obligations” within the meaning of Section 163(i)(1) of the Code, and payment of principal on the scheduled maturity date of any Junior Financing, (C) payments or distributions in respect of all or any portion of the Junior Financing with Excluded Equity Proceeds not otherwise used for any other purpose, (D) the conversion or exchange of any Junior Financing to Qualified Equity Interests of the Borrower, Holdings or any Parent Entity, (E) so long as no Event of Default has occurred and is continuing, payments or distributions in respect of Junior Financings prior to any scheduled maturity made, in an aggregate amount, not to exceed a portion of the Available Free Cash Flow Amount on the date of such election that the Borrower elects to apply to this Section 6.09(b)(i)(E), which such election shall (unless such payment or distribution is made pursuant to clause (a) of the definition of “Available Free Cash Flow Amount”) be set forth in a written notice of a Responsible Officer thereof, which notice shall set forth calculations in reasonable detail of the amount of Available Free Cash Flow Amount immediately prior to such election and the amount thereof elected to be so applied; provided that no Event of Default has occurred and is continuing or would result therefrom and after giving effect to such payments or distributions, the Net Total Leverage Ratio on a Pro Forma Basis shall not be greater than 3.72 to 1.00, (F) other payments and distributions in an aggregate amount (valued at the time of the making thereof and without giving effect to any subsequent change in value) not to exceed the greater of $50,000,000 and 0.15 times the EBITDA calculated on a Pro Forma Basis for the then most recently ended Test Period; provided that no Event of Default has occurred and is continuing and (G) other payments and distributions in respect of Junior Financing; provided that no Event of Default has occurred and is continuing and, immediately after giving effect to such payment or distribution on a Pro Forma Basis, the Net Total Leverage Ratio is not greater than 2.47 to 1.00.

 

(ii)                                  Amend or modify, or permit the amendment or modification of, any provision of any Junior Financing that constitutes Material Indebtedness, or any agreement, document or instrument evidencing or relating thereto, other than amendments or modifications that (A) are not materially adverse to Lenders taken as a whole (as determined in good faith by the Borrower) and that do not affect the subordination provisions thereof (if any) in a manner adverse to the Lenders taken as a whole (as determined in good faith by the Borrower), (B) otherwise comply with the definition of “Permitted Refinancing Indebtedness” or (C) in the case of the Senior Secured Notes, comply with the provisions of the Intercreditor Agreement.

 

(b)                                 Enter into any agreement or instrument that by its terms restricts (i) the payment of dividends or distributions or the making of cash advances by any Material Subsidiary to the Borrower or any Subsidiary that is a direct or indirect parent of such Subsidiary or (ii) the granting of Liens by the Borrower or any Material Subsidiary that is a Loan Party pursuant to the Security Documents, in each case, other than those arising under any Loan Document, except, in each case, restrictions existing by reason of:

 

(A)                               restrictions imposed by applicable law, rule or regulation;

 

(B)                               contractual encumbrances or restrictions in effect on the Closing Date with respect to Liens permitted under Section 6.02(a) or as otherwise disclosed on Schedule 6.09(c) to the Original Credit Agreement, the Senior Secured Notes Documents, any Refinancing Notes or any agreements relating to any Permitted Refinancing Indebtedness in respect of any such Indebtedness and, in each case, any similar contractual encumbrances or restrictions and any amendment, modification, supplement,

 

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replacement or refinancing of such agreements or instruments that does not materially expand the scope of any such encumbrance or restriction or make such restriction materially more onerous (in each case, as determined in good faith by the Borrower);

 

(C)                               any restriction on the Equity Interests or assets of a Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of such Equity Interests or assets permitted under Section 6.05 pending the closing of such sale or disposition;

 

(D)                               customary provisions in joint venture agreements and other similar agreements applicable to the assets of, or the Equity Interests in, joint ventures entered into in the ordinary course of business;

 

(E)                                any restrictions imposed by any agreement relating to a Lien permitted by Section 6.02 to the extent that such restrictions apply only to the property or assets subject to such Lien;

 

(F)                                 customary provisions contained in leases or licenses of Intellectual Property and other similar agreements entered into in the ordinary course of business or consistent with past practice or industry norm;

 

(G)                               customary provisions restricting subletting or assignment of any lease governing a leasehold interest;

 

(H)                              customary provisions restricting assignment of any agreement entered into in the ordinary course of business;

 

(I)                                   customary restrictions and conditions contained in any agreement relating to the Disposition of any asset permitted under Section 6.05 applicable to the asset to be Disposed of pending the consummation of such sale, transfer, lease or other disposition;

 

(J)                                   restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;

 

(K)                               customary provisions contained in leases, licenses, contracts and other similar agreements entered into in the ordinary course of business that impose restrictions on the property subject to such lease;

 

(L)                                any agreement in effect at the time such subsidiary becomes a Subsidiary, so long as such agreement was not entered into in contemplation of such person becoming a Subsidiary and such restriction does not apply to the Borrower or any other Material Subsidiary or any of their respective assets;

 

(M)                            any restrictions imposed by any agreement relating to Indebtedness incurred pursuant to Section 6.01 or Permitted Refinancing Indebtedness in respect thereof, to the extent such restrictions are not materially more restrictive, taken as a whole, than the restrictions contained in the Loan Documents or are market terms at the time of issuance (in each case as determined in good faith by the Borrower);

 

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(N)                               customary restrictions and conditions contained in the document relating to any Lien, so long as (1) such Lien is a Permitted Lien and such restrictions or conditions relate only to the specific asset subject to such Lien, and (2) such restrictions and conditions are not created for the purpose of avoiding the restrictions imposed by this Section 6.09;

 

(O)                               restrictions contained in any Permitted Securitization Document with respect to any Special Purpose Securitization Subsidiary; or

 

(P)                                 customary net worth provisions contained in leases entered into by Holdings, the Borrower or any Subsidiary in the ordinary course of business so long as the Borrower has determined in good faith that such net worth provisions would not reasonably be expected to impair the ability of Holdings, the Borrower or its Subsidiaries to meet their obligations under the Loan Documents.

 

SECTION 6.10                                           Fiscal Year.  In the case of the Borrower, permit any change to its fiscal year without prior notice to the Administrative Agent, in which case, the Borrower and the Administrative Agent will, and are hereby authorized by the Lenders to, make any adjustments to this Agreement that are necessary to reflect such change in fiscal year.

 

SECTION 6.11                                           Financial Covenant.  Permit the Net First Lien Leverage Ratio as of the last day of any fiscal quarter (beginning with the end of the first full fiscal quarter ending after the Closing Date) to exceed 5.10 to 1.00.

 

ARTICLE VII
 EVENTS OF DEFAULT

 

SECTION 7.01                                           Events of Default.  In case of the happening of any of the following events (“Events of Default”):

 

(a)                                 any representation or warranty made or deemed made by the Borrower or any Subsidiary Loan Party herein or in any other Loan Document or any certificate or document delivered pursuant hereto or thereto shall prove to have been false or misleading in any material respect when so made or deemed made and such false or misleading representation or warranty (if curable) shall remain false or misleading for a period of 30 days after notice thereof from the Administrative Agent to the Borrower; provided that the failure of any representation or warranty made or deemed made by any Loan Party (other than the representations and warranties referred to in clause (i) of Section 4.01(b)) to be true and correct in any material respect on the Closing Date will not constitute an Event of Default hereunder;

 

(b)                                 default shall be made in the payment of any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or by acceleration thereof or otherwise;

 

(c)                                  default shall be made in the payment of any interest on any Loan or the reimbursement with respect to any L/C Disbursement or in the payment of any Fee or any other amount (other than an amount referred to in clause (b) above) due under any Loan Document, when and as the same shall become due and payable, and such default shall continue unremedied for a period of five Business Days;

 

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(d)                                 any default shall be made in the due observance or performance by the Borrower of any covenant or agreement contained in Section 5.01(a) (with respect to the Borrower), 5.05(a), 5.09 or in Article VI;

 

(e)                                  default shall be made in the due observance or performance by Holdings of Section 6.08(b) or by the Borrower or any Subsidiary Loan Party of any covenant or agreement contained in any Loan Document (other than those specified in clauses (b), (c) and (d) above) and such default shall continue unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower;

 

(f)                                   (i) any event or condition occurs that (a) results in any Material Indebtedness becoming due prior to its scheduled maturity (other than, for the avoidance of doubt, Material Indebtedness with respect to Permitted Securitization Financings) or (b) enables or permits (with all applicable grace periods having expired) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity or (ii) the Borrower or any Subsidiary (other than any Special Purpose Securitization Subsidiary) shall fail to pay the principal of any Material Indebtedness at the stated final maturity thereof; provided that this clause (f) shall not apply to any secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness if such sale or transfer is permitted hereunder and under the documents providing for such Indebtedness;

 

(g)                                  there shall have occurred a Change in Control;

 

(h)                                 an involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of Holdings, the Borrower or any of its Material Subsidiaries, or of a substantial part of the property or assets of Holdings, the Borrower or any of its Material Subsidiaries, under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, moratorium, insolvency, receivership or similar law, (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Holdings, the Borrower or any of its Material Subsidiaries or for a substantial part of the property or assets of Holdings, the Borrower or any of its Material Subsidiaries or (iii) the winding-up or liquidation of Holdings, the Borrower or any of its Material Subsidiaries (other than permitted hereunder); and such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

 

(i)                                     Holdings, the Borrower or any of its Material Subsidiaries shall (i) voluntarily commence any proceeding or file any petition seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, moratorium, insolvency, receivership or similar law, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or the filing of any petition described in clause (h) above, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Holdings, the Borrower or any of its Material Subsidiaries or for a substantial part of the property or assets of Holdings, the Borrower or any of its Material Subsidiaries, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) become unable, admit in writing its inability or fail generally to pay its debts as they become due;

 

(j)                                    the failure by the Borrower or any Material Subsidiary to pay one or more final judgments aggregating in excess of $75,000,000 (to the extent not covered by insurance), which judgments are not discharged or effectively waived or stayed for a period of 30 consecutive days, or any

 

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action shall be legally taken by a judgment creditor to levy upon assets or properties of the Borrower or any Material Subsidiary to enforce any such judgment;

 

(k)                                 (i) an ERISA Event shall have occurred, (ii) the PBGC shall institute proceedings (including giving notice of intent thereof) to terminate any Plan or Plans, (iii) the Borrower or any Subsidiary or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or is being terminated, within the meaning of Title IV of ERISA, or (iv)  the Borrower or any Subsidiary shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan; and in each case in clauses (i) through (iv) above, such event or condition, together with all other such events or conditions, if any, would reasonably be expected to have a Material Adverse Effect; or

 

(l)                                     (i) any material provision of any Loan Document shall for any reason be asserted in writing by Holdings, the Borrower or any Subsidiary Loan Party not to be a legal, valid and binding obligation of any party thereto (other than in accordance with its terms), (ii) any security interest purported to be created by any Security Document and to extend to assets that constitute a material portion of the Collateral shall cease to be, or shall be asserted in writing by the Borrower or any other Loan Party not to be (other than in accordance with its terms), a valid and perfected security interest (perfected as or having the priority required by this Agreement or the relevant Security Document and subject to such limitations and restrictions as are set forth herein and therein) in the securities, assets or properties covered thereby, except to the extent that any such loss of perfection or priority results from the limitations of foreign laws, rules and regulations as they apply to pledges of Equity Interests in Foreign Subsidiaries or the application thereof, or except from the failure of the Collateral Agent to maintain possession of certificates actually delivered to it representing securities pledged under the Collateral Agreement or to file Uniform Commercial Code continuation statements or take the actions described on Schedule 3.04 to the Original Credit Agreement and except to the extent that such loss is covered by a lender’s title insurance policy and the Administrative Agent shall be reasonably satisfied with the credit of such insurer, or (iii) a material portion of the Guarantees pursuant to the Security Documents by Holdings or the Subsidiary Loan Parties guaranteeing the Obligations shall cease to be in full force and effect (other than in accordance with the terms thereof), or shall be asserted in writing by Holdings or any Subsidiary Loan Party not to be in effect or not to be legal, valid and binding obligations (other than in accordance with the terms thereof); provided that no Event of Default shall occur under this Section 7.01(l) if the Loan Parties cooperate with the Collateral Agent to replace or perfect such security interest and Lien, such security interest and Lien is replaced and the rights, powers and privileges of the Secured Parties are not materially adversely affected by such replacement;

 

then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) above), and at any time thereafter during the continuance of such event, the Administrative Agent, at the request of the Required Lenders, shall, by notice to the Borrower, take any or all of the following actions, at the same or different times:  (i) terminate forthwith the Commitments, (ii) declare the Loans then outstanding to be forthwith due and payable in whole or in part, whereupon the principal of the Loans then outstanding so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any other Loan Document to the contrary notwithstanding and (iii) demand Cash Collateral pursuant to Section 2.22; and in any event with respect to the Borrower described in clause (h) or (i) above, the Commitments shall automatically terminate, the principal of the Loans then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder and under any other Loan Document, shall automatically become due and payable and the Administrative Agent shall be deemed to have made a demand for Cash Collateral to the full extent

 

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permitted under Section 2.22, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any other Loan Document to the contrary notwithstanding.

 

For purposes of clauses (h), (i) and (j) of this Section 7.01, “Material Subsidiary” (1) shall mean any Subsidiary that would not be an Immaterial Subsidiary under clause (a) of the definition thereof and (2) shall exclude any Special Purpose Securitization Subsidiary.

 

SECTION 7.02                                           Treatment of Certain Payments.  Subject to the terms of any applicable Intercreditor Agreement, any amount received by the Administrative Agent or the Collateral Agent from any Loan Party (or from proceeds of any Collateral) following any acceleration of the Obligations under this Agreement or any Event of Default with respect to the Borrower under Section 7.01(h) or (i), in each case that is continuing, shall be applied:  (i) first, ratably, to pay any fees, indemnities or expense reimbursements then due to the Administrative Agent or the Collateral Agent from the Borrower (other than in connection with any Secured Cash Management Agreement or Secured Swap Agreement), (ii) second, towards payment of interest and fees then due from the Borrower hereunder (which, for the avoidance of doubt, shall include payment of scheduled periodic payments in respect of any Secured Swap Agreement), ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, (iii) third, towards payment of unreimbursed L/C Disbursements then due from the Borrower hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed L/C Disbursements then due to such parties, (iv) fourth, towards payment of other Obligations (including Obligations of the Loan Parties owing under or in respect of any Secured Cash Management Agreement or Secured Swap Agreement not already paid pursuant to (ii) above) then due from the Borrower hereunder, ratably among the parties entitled thereto in accordance with the amounts of such Obligations then due to such parties and (v) last, the balance, if any, after all of the Obligations have been paid in full, to the Borrower or as otherwise required by Requirements of Law.

 

SECTION 7.03                                           Cure Right.  Notwithstanding anything to the contrary contained in Section 7.01, in the event that the Borrower fails (or, but for the operation of this Section 7.03, would fail) to comply with the requirements of the Financial Covenant, from the last day of the applicable fiscal quarter until the expiration of the 10th Business Day subsequent to the date the certificate calculating such Financial Covenant is required to be delivered pursuant to Section 5.04(c), Holdings, the Borrower and any Parent Entity shall have the right to issue Permitted Cure Securities for cash or otherwise receive cash contributions to the capital of such entities, and in each case, to contribute any such cash to the capital of the Borrower (collectively, the “Cure Right”), and upon the receipt by the Borrower of such cash (the “Cure Amount”), pursuant to the exercise of the Cure Right, the Financial Covenant shall be recalculated giving effect to a pro forma adjustment by which EBITDA shall be increased with respect to such applicable quarter and any four-quarter period that contains such quarter, solely for the purpose of measuring the Financial Covenant and not for any other purpose under this Agreement, by an amount equal to the Cure Amount; provided that (i) in each four consecutive fiscal quarter period there shall be at least two fiscal quarters in which a Cure Right is not exercised, (ii) a Cure Right shall not be exercised more than five times during the term of the Agreement, (iii) for purposes of this Section 7.03, the Cure Amount shall be no greater than the amount required for purposes of complying with the Financial Covenant, (iv) there shall be no pro forma reduction in Indebtedness with the proceeds of the exercise of the Cure Right for determining compliance with the Financial Covenant for the fiscal quarter in respect of which such Cure Right is exercised (either directly through prepayment or indirectly as a result of the netting of unrestricted cash) and (v) the Cure Amount shall not build the Available Free Cash Flow Amount.  If, after giving effect to the adjustments in this Section 7.03, the Borrower shall then be in compliance with the requirements of the Financial Covenant, the Borrower shall be deemed to have satisfied the requirements of the Financial Covenant as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable

 

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breach or default of the Financial Covenant that had occurred shall be deemed cured.  In the event that (i) no Default exists other than that arising due to failure of the Borrower to comply with Financial Covenant, and (ii) Holdings, the Borrower or such Parent Entity, as applicable, shall have delivered to Administrative Agent written notice of its intention to cause Borrower to exercise the Cure Right (which notice shall be delivered no earlier than 15 days prior to, and no later than the fifth day subsequent to the date the certificate calculating such Financial Covenant is required to be delivered pursuant to Section 5.04(c)), which exercise if fully consummated would be sufficient in accordance with the terms hereof to cause Borrower to be in compliance with the Financial Covenant as of the relevant date of determination, then from and following receipt by Administrative Agent of any such notice and until the date that is the earlier of (x) the 10th day subsequent to the date the certificate calculating such Financial Covenant is required to be delivered pursuant to Section 5.04(c) and (y) the date, if any, on which Holdings, the Borrower or such Parent Entity notifies the Administrative Agent in writing that such Cure Right shall not be exercised, no Default shall be deemed to exist during such period for purposes of this Agreement and  neither the Administrative Agent nor any Lender shall exercise any remedies set forth in Section 7.01 hereof during such period solely as a result of the failure by the Borrower to comply with the Financial Covenant.

 

ARTICLE VIII
 THE AGENTS

 

SECTION 8.01                                           Appointment and Authority.

 

(a)                                 Each of the Lenders (in its capacities as a Lender and on behalf of itself and its Affiliates as potential counterparties to Secured Cash Management Agreements and Secured Swap Agreements) and each Issuing Bank (in such capacities and on behalf of itself and its Affiliates as potential counterparties to Secured Cash Management Agreements and Secured Swap Agreements) hereby irrevocably designates and appoints the Administrative Agent as the agent of such Lender under this Agreement and the other Loan Documents, and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the Issuing Banks, and the Borrower shall not have rights as a third party beneficiary of any of such provisions.

 

(b)                                 The Administrative Agent shall also act as the “Collateral Agent” under the Loan Documents, and each of the Lenders and the Issuing Banks hereby irrevocably appoints and authorizes the Administrative Agent to act as the agent of such Lender and the Issuing Banks for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion as are reasonably incidental thereto.  In this connection, the Administrative Agent, as “Collateral Agent” and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to Section 8.05 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Security Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent), shall be entitled to the benefits of all provisions of this Article VIII and Article IX (including Section 9.04(d), as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto.

 

SECTION 8.02                                           Rights as a Lender.  The person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the person

 

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serving as the Administrative Agent hereunder in its individual capacity.  Such person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

 

SECTION 8.03                                           Exculpatory Provisions.  The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents.  Without limiting the generality of the foregoing, the Administrative Agent:

 

(a)                                 shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default has occurred and is continuing;

 

(b)                                 shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents or that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law; and

 

(c)                                  shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the person serving as the Administrative Agent or any of its Affiliates in any capacity.

 

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 7.01 and 9.09) or (ii) in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice describing such Default is given to the Administrative Agent by the Borrower, a Lender or an Issuing Bank.

 

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

 

SECTION 8.04                                           Reliance by Administrative Agent.  The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper person, and shall not incur any liability for relying thereon.  In determining compliance with any condition

 

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hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Bank, the Administrative Agent may presume that such condition is satisfactory to such Lender or an Issuing Bank unless the Administrative Agent shall have received notice to the contrary from such Lender or an Issuing Bank prior to the making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

SECTION 8.05                                           Delegation of Duties.  The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article VIII shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.

 

SECTION 8.06                                           Resignation of Administrative Agent.

 

(a)                                 The Administrative Agent may at any time give notice of its resignation to the Lenders, the Issuing Banks and the Borrower.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with the consent of the Borrower (unless an Event of Default Under Section 7.01(b), (c), (h) or (i) has occurred and is continuing), to appoint a successor, which shall be a bank with an office in the United States of America, or an Affiliate of any such bank with an office in the United States of America, and the Administrative Agent further agrees that for the 30 day period immediately following its notice of resignation, it will not appoint a successor unless the Borrower shall have consented to such successor, such consent not to be unreasonably withheld or delayed.  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the Issuing Banks, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except in its capacity as Collateral Agent holding collateral security on behalf of any Secured Parties, it shall continue to hold such collateral security as nominee until such time as a successor Collateral Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and the Issuing Banks directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section 8.06.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section 8.06.  The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor.  After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article VIII and Section 9.05 shall continue in effect for the benefit of such retiring Administrative Agent, its sub agents and their respective Related Parties in respect

 

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of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

 

(b)                                 Any resignation by CS as Administrative Agent pursuant to this Section 8.06 shall also constitute its resignation as Issuing Bank.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Issuing Bank, (b) the retiring Issuing Bank shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor Issuing Bank shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring Issuing Bank to effectively assume the obligations of the retiring Issuing Bank with respect to such Letters of Credit.

 

SECTION 8.07                                           Non-Reliance on Administrative Agent and Other Lenders.  Each Lender and the Issuing Banks acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender and each Issuing Bank also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder

 

SECTION 8.08                                           No Other Duties, Etc.  Anything herein to the contrary notwithstanding, none of the Agents or Joint Lead Arrangers listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, the Collateral Agent, a Lender or an Issuing Bank hereunder.

 

SECTION 8.09                                           Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise

 

(a)                                 to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, Letters of Credit and all other Loan Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the Issuing Banks and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the Issuing Banks and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the Issuing Banks and the Administrative Agent under Sections 2.12 and 9.05) allowed in such judicial proceeding; and

 

(b)                                 to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the Issuing Banks to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the Issuing Banks, to pay to the

 

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Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.12 and 9.05.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or the Issuing Banks any plan of reorganization, arrangement, adjustment or composition affecting the Loan Obligations or the rights of any Lender or the Issuing Banks to authorize the Administrative Agent to vote in respect of the claim of any Lender or the Issuing Banks in any such proceeding.

 

SECTION 8.10                                           Collateral Agreement.

 

(a)                                 The Lenders and the Issuing Banks irrevocably authorize the Collateral Agent, at its option and in its discretion, to

 

(i)                                     release any Lien on any property granted to or held by the Collateral Agent under any Loan Document (A) upon termination of the Commitments and payment in full of all Loan Obligations (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements reasonably satisfactory to the Collateral Agent and the Issuing Banks shall have been made), (B) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, or (C) subject to Section 9.09, if approved, authorized or ratified in writing by the Required Lenders; and

 

(ii)                                  to subordinate any Lien on any property granted to or held by the Collateral Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 6.02, on terms reasonably acceptable to the Administrative Agent.

 

(b)                                 The Lenders and the Issuing Banks irrevocably authorize the Administrative Agent, at its option and in its discretion, to release any guarantor from its obligations under the Collateral Agreement if such person ceases to be a Subsidiary Loan Party as a result of a transaction permitted hereunder.

 

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s or Collateral Agent’s, as applicable, authority to release or subordinate its interest in particular types or items of property, or to release any guarantor from its obligations under the Collateral Agreement.

 

ARTICLE IX
 MISCELLANEOUS

 

SECTION 9.01                                           Notices; Communications.

 

(a)                                 Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier or other electronic means (e.g., “e-mail” and/or “pdf”) as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

 

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(i)                                     if to any Loan Party, the Administrative Agent, the Collateral Agent or the Issuing Banks as of the Closing Date to the address, telecopier number, electronic mail address or telephone number specified for such person on Schedule 9.01 to the Original Credit Agreement; and

 

(ii)                                  if to any other Lender or Issuing Bank, to the address, telecopier number, electronic mail address or telephone number set forth separately in writing and delivered to the Borrower and the Administrative Agent.

 

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient).  Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below shall be effective as provided in such subsection (b).

 

(b)                                 Notices and other communications to the Lenders and each Issuing Bank hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent.  The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.

 

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

 

(c)                                  Each of the Borrower, the Administrative Agent and each Issuing Bank may change its address, electronic mail address or telephone number for notices and other communications hereunder by notice to the other parties hereto.  Each other Lender may change its address, telecopy number, electronic mail address or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent and each Issuing Bank.  In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.  Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States federal and state securities Laws, to make reference to the Communications that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to Holdings, the Borrower, their Subsidiaries or their respective securities for purposes of United States federal or state securities laws.

 

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(d)                                 The Administrative Agent, each Issuing Bank and the Lenders shall be entitled to rely and act upon any notices (including telephonic Borrowing Requests) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof.  All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

 

SECTION 9.02                                           Survival of Agreement.  All covenants, agreements, representations and warranties made by the Borrower and the other Loan Parties herein, in the other Loan Documents and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Lenders and each Issuing Bank and shall survive the making by the Lenders of the Loans, the execution and delivery of the Loan Documents and the issuance of the Letters of Credit, regardless of any investigation made by such persons or on their behalf, and shall continue in full force and effect until the Termination Date.  Without prejudice to the survival of any other agreements contained herein, indemnification and reimbursement obligations contained herein (including pursuant to Sections 2.15, 2.16, 2.17 and 9.05) shall survive the Termination Date.

 

SECTION 9.03                                           Binding Effect.  This Agreement shall become effective when it shall have been executed by Holdings, the Borrower and the Administrative Agent and when the Administrative Agent shall have received copies hereof that, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of Holdings, the Borrower, each Issuing Bank, the Administrative Agent and each Lender and their respective permitted successors and assigns.

 

SECTION 9.04                                           Successors and Assigns.

 

(a)                                 The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit), except that (i)  the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section 9.04 (and any attempted assignment or transfer by any party hereto shall be null and void).  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit), Participants (to the extent provided in clause (c) of this Section 9.04), and, to the extent expressly contemplated hereby, the Related Parties of each of the Agents, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement or the other Loan Documents.

 

(b)                                 (i) Subject to the conditions set forth in subclause (ii) below, any Lender may assign to one or more assignees (each, an “Assignee”) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments and the Loans (including for purposes of this Section 9.04(b), participations in Letter of Credit obligations) at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of:

 

(1)                                 the Borrower, which consent, with respect to the assignment of a Term B Loan, will be deemed to have been given if the Borrower has not responded within 10 Business Days after the delivery of any request for

 

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such consent; provided that no consent of the Borrower shall be required for an assignment of a Term B Loan to a Lender, an Affiliate of a Lender, an Approved Fund (as defined below), or in the case of assignments during the primary syndication of the Commitments and Loans to persons identified to and agreed by the Borrower in writing prior to the Closing Date, or for an assignment of a Revolving Facility Commitment or Revolving Facility Loan to a Revolving Facility Lender, an Affiliate of a Revolving Facility Lender or Approved Fund with respect to a Revolving Facility Lender, or, in each case, if an Event of Default under Section 7.01(b), (c), (h) or (i) has occurred and is continuing, any other person; and

 

(2)                                 the Administrative Agent; provided that no consent of the Administrative Agent shall be required for an assignment of all or any portion of a Term Loan to a Lender, an Affiliate of a Lender, an Approved Fund, the Borrower or an Affiliate of the Borrower made in accordance with Section 9.04(i) or Section 9.24; and

 

(3)                                 the Issuing Banks; provided that no consent of the Issuing Banks shall be required for an assignment of all or any portion of a Term Loan.

 

(ii)                                  Assignments shall be subject to the following additional conditions:

 

(1)                                 except in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitments or Loans under any Facility, the amount of the Commitments or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent) shall not be less than (x) $1,000,000 or an integral multiple of $1,000,000 in excess thereof in the case of Term Loans and (y) $5,000,000 or an integral multiple of $1,000,000 in excess thereof in the case of Revolving Facility Loans or Revolving Facility Commitments, unless each of the Borrower and the Administrative Agent otherwise consent; provided that such amounts shall be aggregated in respect of each Lender and its Affiliates or Approved Funds (with simultaneous assignments to or by two or more Related Funds shall be treated as one assignment), if any;

 

(2)                                 the parties to each assignment shall (1) execute and deliver to the Administrative Agent an Assignment and Acceptance via an electronic settlement system acceptable to the Administrative Agent or (2) if previously agreed with the Administrative Agent, manually execute and deliver to the Administrative Agent an Assignment and Acceptance, in each case together with a processing and recordation fee of $3,500 (which fee may be waived or reduced in the reasonable discretion of the Administrative Agent);

 

(3)                                 the Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent any tax forms required to be delivered pursuant to Section 2.17; and

 

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(4)                                 the Assignee shall not be the Borrower or any of the Borrower’s Affiliates or Subsidiaries except in accordance with Section 9.04(i) or Section 9.24.

 

For the purposes of this Section 9.04, “Approved Fund” shall mean any person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.  Notwithstanding the foregoing or anything to the contrary herein, no Lender shall be permitted to assign or transfer any portion of its rights and obligations under this Agreement to (A) any Ineligible Institution, (B) any Defaulting Lender or any of its Subsidiaries, or any person who, upon becoming a Lender hereunder, would constitute any of the foregoing persons described in this clause (B), or (C) a natural person.  Notwithstanding the foregoing, each Loan Party and the Lenders acknowledge and agree that the Administrative Agent shall not have any responsibility or obligation to determine whether any Lender or potential Lender is an Ineligible Institution and the Administrative Agent shall have no liability with respect to any assignment made to an Ineligible Institution.  Any assigning Lender shall, in connection with any potential assignment, provide to the Borrower a copy of its request (including the name of the prospective assignee) concurrently with its delivery of the same request to the Administrative Agent irrespective of whether or not an Event of Default under Section 7.01(b), (c), (h) or (i) has occurred and is continuing.

 

(iii)                               Subject to acceptance and recording thereof pursuant to subclause (v) below, from and after the effective date specified in each Assignment and Acceptance the Assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.15, 2.16, 2.17 and 9.05 (subject to the limitations and requirements of those Sections)).  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with clause (d) of this Section 9.04 (except to the extent such participation is not permitted by such clause (d) of this Section 9.04, in which case such assignment or transfer shall be null and void).

 

(iv)                              The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal and interest amounts of the Loans and Revolving L/C Exposure owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent, the Issuing Banks and the Lenders shall treat each person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  In addition, the Administrative Agent shall maintain on the Register, information regarding the designation, and revocation of the designation, of any Lender as a Defaulting Lender.  The Register shall be available for inspection by the Borrower, the Issuing Banks and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

 

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(v)                                 Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an Assignee, the processing and recordation fee referred to in clause (b) of this Section 9.04, if applicable, and any written consent to such assignment required by clause (b) of this Section 9.04 and any applicable tax forms, the Administrative Agent shall accept such Assignment and Acceptance and promptly record the information contained therein in the Register.  No assignment, whether or not evidenced by a promissory note, shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this subclause (v).

 

(c)                                  [Reserved].

 

(d)                                 (i) Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations in Loans and Commitments to one or more banks or other entities other than (I) any Ineligible Institution (to the extent that the list of Ineligible Institutions has been made available to all Lenders; provided that regardless of whether the list of Ineligible Institutions has been made available to all Lenders, no Lender may sell participations in Loans or Commitments to an Ineligible Institution without the consent of the Borrower if the list of Ineligible Institutions has been made available to such Lender) or (II) any Defaulting Lender or any of its Subsidiaries, or any person who, upon becoming a Lender hereunder, would constitute any of the foregoing persons described in this clause (II) (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitments and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (C) the Borrower, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and the other Loan Documents and to approve any amendment, modification or waiver of any provision of this Agreement and the other Loan Documents; provided that (x) such agreement may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver that both (1) requires the consent of each Lender directly affected thereby pursuant to clauses (i), (ii), (iii) or (vi) of the first proviso to Section 9.09(b) and (2) directly affects such Participant (but, for the avoidance of doubt, not any waiver of any Default or Event of Default) and (y) no other agreement with respect to amendment, modification or waiver may exist between such Lender and such Participant.  Subject to clause (d)(iii) of this Section 9.04, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 (subject to the limitations and requirements of those Sections and Section 2.19) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (b) of this Section 9.04.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.06 as though it were a Lender; provided that such Participant shall be subject to Section 2.18(c) as though it were a Lender.  Notwithstanding the foregoing, each Loan Party and the Lenders acknowledge and agree that the Administrative Agent shall not have any responsibility or obligation to determine whether any Participant or potential Participant is an Ineligible Institution and the Administrative Agent shall have no liability with respect to any participation made to an Ineligible Institution.

 

(ii)                                  Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts and interest amounts of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”).  The entries in the Participant Register shall be conclusive absent manifest error, and each party hereto shall treat each person whose name is recorded in the Participant Register as the owner of

 

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such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  Without limitation of the requirements of this Section 9.04(d), no Lender shall have any obligation to disclose all or any portion of a Participant Register to any person (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans or other Loan Obligations under any Loan Document), except to the extent that such disclosure is necessary to establish that such Commitment, Loan or other Loan Obligation is in registered form for U.S. federal income tax purposes or is otherwise  required by applicable law.  For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

(iii)                               A Participant shall not be entitled to receive any greater payment under Sections 2.15, 2.16 or 2.17 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.

 

(e)                                  Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank and in the case of any Lender that is an Approved Fund, any pledge or assignment to any holders of obligations owed, or securities issued, by such Lender, including to any trustee for, or any other representative of, such holders, and this Section 9.04 shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or Assignee for such Lender as a party hereto.

 

(f)                                   The Borrower, at its expense and upon receipt of written notice from the relevant Lender, agrees to issue Notes to any Lender requiring Notes to facilitate transactions of the type described in clause (e) above.

 

(g)                                  Notwithstanding the foregoing, any Conduit Lender may assign any or all of the Loans it may have funded hereunder to its designating Lender without the consent of the Borrower or the Administrative Agent.  Each of Holdings, the Borrower, each Lender and the Administrative Agent hereby confirms that it will not institute against a Conduit Lender or join any other person in instituting against a Conduit Lender any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding under any state bankruptcy or similar law, for one year and one day after the payment in full of the latest maturing commercial paper note issued by such Conduit Lender; provided, however, that each Lender designating any Conduit Lender hereby agrees to indemnify, save and hold harmless each other party hereto and each Loan Party for any loss, cost, damage or expense arising out of its inability to institute such a proceeding against such Conduit Lender during such period of forbearance.

 

(h)                                 If the Borrower wishes to replace the Loans or Commitments under any Facility with ones having different terms, it shall have the option, with the consent of the Administrative Agent and subject to at least three Business Days’ advance notice to the Lenders under such Facility, instead of prepaying the Loans or reducing or terminating the Commitments to be replaced, to (i) require the Lenders under such Facility to assign such Loans or Commitments to the Administrative Agent or its designees and (ii) amend the terms thereof in accordance with Section 9.09 (with such replacement, if applicable, being deemed to have been made pursuant to Section 9.09(d)).  Pursuant to any such assignment, all Loans and Commitments to be replaced shall be purchased at par (allocated among the Lenders under such Facility in the same manner as would be required if such Loans were being optionally prepaid or such Commitments were being optionally reduced or terminated by the Borrower), accompanied by payment of any accrued interest and fees thereon and any amounts owing pursuant to

 

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Section 9.05(b).  By receiving such purchase price, the Lenders under such Facility shall automatically be deemed to have assigned the Loans or Commitments under such Facility pursuant to the terms of the form of Assignment and Acceptance attached as Exhibit A to the Original Credit Agreement, and accordingly no other action by such Lenders shall be required in connection therewith.  The provisions of this clause (h) are intended to facilitate the maintenance of the perfection and priority of existing security interests in the Collateral during any such replacement.

 

(i)                                     Notwithstanding anything to the contrary in this Agreement, including Section 2.18(c) (which provisions shall not be applicable to clauses (i) or (j) of this Section 9.04), any of Holdings or its Subsidiaries, including the Borrower, may purchase by way of assignment and become an Assignee with respect to Term Loans at any time and from time to time from Lenders in accordance with Section 9.04(b) hereof (each, a “Permitted Loan Purchase”); provided that, in respect of any Permitted Loan Purchase, (A)  no Permitted Loan Purchase shall be made from the proceeds of any extensions of credit under the Revolving Facility, (B) upon consummation of any such Permitted Loan Purchase, the Loans purchased pursuant thereto shall be deemed to be automatically and immediately cancelled and extinguished in accordance with Section 9.04(j), (C) in connection with any such Permitted Loan Purchase, any of Holdings or its Subsidiaries, including the Borrower and such Lender that is the assignor (an “Assignor”) shall execute and deliver to the Administrative Agent a Permitted Loan Purchase Assignment and Acceptance (and for the avoidance of doubt, (x) shall make the representations and warranties set forth in the Permitted Loan Purchase Assignment and Acceptance and (y) shall not be required to execute and deliver an Assignment and Acceptance pursuant to Section 9.04(b)(ii)(2)) and shall otherwise comply with the conditions to Assignment and Acceptances under this Section 9.04 and (D) no Default or Event of Default would exist immediately after giving effect on a Pro Forma Basis to such Permitted Loan Purchase.

 

(j)                                    Each Permitted Loan Purchase shall, for purposes of this Agreement be deemed to be an automatic and immediate cancellation and extinguishment of such Term Loans and the Borrower shall, upon consummation of any Permitted Loan Purchase, notify the Administrative Agent that the Register be updated to record such event as if it were a prepayment of such Loans.

 

(k)                                 In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, each Issuing Bank or any other Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit in accordance with its Applicable Percentage; provided that notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable law without compliance with the provisions of this clause, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

 

SECTION 9.05                                           Expenses; Indemnity.

 

(a)                                 The Borrower agrees to pay  (i) all reasonable and documented out-of-pocket expenses (including Other Taxes) incurred by the Administrative Agent or the Collateral Agent in connection with the preparation of this Agreement and the other Loan Documents, or by the

 

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Administrative Agent or the Collateral Agent in connection with the administration of this Agreement and any amendments, modifications or waivers of the provisions hereof or thereof, including the reasonable fees, charges and disbursements of Latham & Watkins LLP, counsel for the Administrative Agent, the Collateral Agent and the Joint Lead Arrangers, and, if necessary, the reasonable fees, charges and disbursements of one local counsel per jurisdiction, and (ii) all reasonable and documented out-of-pocket expenses (including Other Taxes) incurred by the Agents, any Issuing Bank or any Lender in connection with the enforcement of their rights in connection with this Agreement and the other Loan Documents, in connection with the Loans made or the Letters of Credit issued hereunder, including the fees, charges and disbursements of a single counsel for all such persons, taken as a whole, and, if necessary, a single local counsel in each appropriate jurisdiction for all such persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where such person affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel with the Borrower’s prior written consent (not to be unreasonably withheld), of another firm of such for such affected person).

 

(b)                                 The Borrower agrees to indemnify the Administrative Agent, the Collateral Agent, the Joint Lead Arrangers, any co-manager, each Issuing Bank, each Lender, each of their respective Affiliates, successors and assignors, and each of their respective directors, officers, employees, agents, trustees, advisors and members (each such person being called an “Indemnitee”) against, and to hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel fees, charges and disbursements (excluding the allocated costs of in house counsel and limited to not more than one counsel for all such Indemnitees, taken as a whole, and, if necessary, a single local counsel in each appropriate jurisdiction for all such Indemnitees, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnitee affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel with the Borrower’s prior written consent (not to be unreasonably withheld), of another firm of counsel for such affected Indemnitee)), incurred by or asserted against any Indemnitee arising out of or as a result of (i) the execution or delivery of this Agreement or any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto and thereto of their respective obligations thereunder or the consummation of the Transactions or the Repricing Date Transactions and the other transactions contemplated hereby, (ii) the use of the proceeds of the Loans or the use of any Letter of Credit (including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any violation of Environmental Laws by, or liability under Environmental Laws of, the Borrower or any Subsidiary, (iv) any actual or alleged presence, Release or threatened Release of or exposure to Hazardous Materials at, under, on, from or to any property currently or formerly owned, leased or operated by the Borrower or any Subsidiary or (v) any claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not any Indemnitee is a party thereto and regardless of whether such matter is initiated by a third party or by Holdings, the Borrower or any of their subsidiaries or Affiliates; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a final, non-appealable judgment of a court of competent jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee or any of its Related Parties, (y) arose from a material breach of such Indemnitee’s or any of its Related Parties’ obligations under any Loan Document (as determined by a court of competent jurisdiction in a final, non-appealable judgment) or (z) arose from any claim, actions, suits, inquiries, litigation, investigation or proceeding that does not involve an act or omission of the Borrower or any of its Affiliates and is brought by an Indemnitee against another Indemnitee (other than any claim, actions, suits, inquiries, litigation, investigation or proceeding against any Agent, a Joint Lead Arranger or any co-manager in its capacity as such).  None of the Indemnitees (or any of their respective Affiliates) shall be responsible or liable to the Investors, Holdings, the Borrower or any of their respective subsidiaries, Affiliates or stockholders or any other person or entity for any special, indirect, consequential or punitive damages, which may be alleged as a result of the

 

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Facilities or the Transactions or the Repricing Date Transactions.  The provisions of this Section 9.05 shall remain operative and in full force and effect regardless of the expiration of the term of this Agreement, the consummation of the transactions contemplated hereby, the repayment, satisfaction and discharge of any of the Obligations, the resignation of any Agent or any Issuing Bank, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of the Administrative Agent, any Issuing Bank or any Lender.  All amounts due under this Section 9.05 shall be payable within 15 days after written demand therefor accompanied by reasonable documentation with respect to any reimbursement, indemnification or other amount requested.

 

(c)                                  Except as expressly provided in Section 9.05(a) with respect to Other Taxes, which shall not be duplicative with any amounts paid pursuant to Section 2.17, this Section 9.05 shall not apply to any Taxes (other than Taxes that represent losses, claims, damages, liabilities and related expenses resulting from a non-Tax claim), which shall be governed exclusively by Section 2.17 and, to the extent set forth therein, Section 2.15.

 

(d)                                 To the fullest extent permitted by applicable law, Holdings and the Borrower shall not assert, and hereby waive, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.

 

(e)                                  To the extent that the Borrower for any reason fails to pay any amount required under subsection (a) or (b) of this Section to be paid by it to any Agent (or any sub agent thereof), any Issuing Bank or any Related Party of any of the foregoing, each Lender severally agrees to pay to the applicable Agent (or any such sub agent), the applicable Issuing Bank or such related Party, as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the applicable Agent (or any such sub agent) or the applicable Issuing Bank in its capacity as such, or against any Related Party of any of the foregoing acting for the Applicable Agent (or any such sub agent) or applicable Issuing Bank in connection with such capacity.  The obligations of the Lenders under this subsection (e) are subject to the provisions of Section 2.18(f).

 

SECTION 9.06                                           Right of Set-off.  If an Event of Default shall have occurred and be continuing, each Lender and each Issuing Bank is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other Indebtedness at any time owing by such Lender or such Issuing Bank to or for the credit or the account of Holdings, the Borrower or any other Subsidiary against any of and all the obligations of Holdings or the Borrower now or hereafter existing under this Agreement or any other Loan Document held by such Lender or such Issuing Bank, irrespective of whether or not such Lender or such Issuing Bank shall have made any demand under this Agreement or such other Loan Document and although the obligations may be unmatured; provided that, in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.23 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the

 

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Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.  The rights of each Lender and each Issuing Bank under this Section 9.06 are in addition to other rights and remedies (including other rights of set-off) that such Lender or such Issuing Bank may have.

 

SECTION 9.07                                           Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is made to the Administrative Agent, any Issuing Bank or any Lender, or the Administrative Agent, any Issuing Bank or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, such Issuing Bank or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and Issuing Bank severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders and the Issuing Banks under clause (b) of the preceding sentence shall survive the payment in full of the Loan Obligations and the termination of this Agreement

 

SECTION 9.08                                           Applicable Law.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSES OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT (OTHER THAN AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ANY PRINCIPLE OF CONFLICTS OF LAW THAT COULD REQUIRE THE APPLICATION OF ANY OTHER LAW.

 

SECTION 9.09                                           Waivers; Amendment.

 

(a)                                 No failure or delay of the Administrative Agent, the Collateral Agent, any Issuing Bank or any Lender in exercising any right or power hereunder or under any Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Administrative Agent, the Collateral Agent, each Issuing Bank and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by Holdings, the Borrower or any other Loan Party therefrom shall in any event be effective unless the same shall be permitted by clause (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice or demand on Holdings, the Borrower or any other Loan Party in any case shall entitle such person to any other or further notice or demand in similar or other circumstances.

 

(b)                                 Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except (x) as provided in Section 2.20, (y) in the case of this Agreement, except as set forth in Section 2.14, pursuant to an agreement or agreements in writing entered into by Holdings, the Borrower and the Required Lenders (or, (A) with respect to the provisions of  Section 4.01 after the Closing Date, solely as they relate to the Revolving Facility Loans and Letters of

 

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Credit, the Required Revolving Facility Lenders voting as a single Class, rather than the Required Lenders, or (B) in respect of any waiver, amendment or modification of Section 2.11(b) or (c), the Required Prepayment Lenders, rather than the Required Lenders), and (z) in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by each Loan Party party thereto and the Administrative Agent and consented to by the Required Lenders; provided, however, that no such agreement shall:

 

(i)                                     decrease or forgive the principal amount of, or extend the final maturity of, or decrease the rate of interest on, any Loan or any L/C Disbursement, or extend the stated expiration of any Letter of Credit beyond the applicable Revolving Facility Maturity Date (except as provided in Section 2.05(i)), without the prior written consent of each Lender directly adversely affected thereby; provided that any amendment to the financial definitions in this Agreement shall not constitute a reduction in the rate of interest for purposes of this clause (i),

 

(ii)                                  increase or extend the Commitment of any Lender, or decrease the Commitment Fees, L/C Participation Fees or any other Fees of any Lender without the prior written consent of such Lender (it being understood that waivers or modifications of conditions precedent, covenants, Defaults or Events of Default, mandatory prepayments or of a mandatory reduction in the aggregate Commitments shall not constitute an increase or extension of the Commitments of any Lender for purposes of this clause (ii),

 

(iii)                               extend or waive any Term Loan Installment Date or reduce the amount due on any Term Loan Installment Date or extend any date on which payment of interest on any Loan or any L/C Disbursement or any Fees is due, without the prior written consent of each Lender directly adversely affected thereby,

 

(iv)                              amend or modify the provisions of Section 7.02 or Section 2.18(c) with respect to the pro rata application or sharing of payments required thereby in a manner that by its terms modifies the application or sharing of such payments required thereby to be on a less than pro rata basis, without the prior written consent of each Lender adversely affected thereby,

 

(v)                                 amend or modify the provisions of this Section 9.09 or the definition of the terms “Required Lenders,” “Majority Lenders,” “Required Prepayment Lenders,” “Required Revolving Facility Lenders,” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the prior written consent of each Lender adversely affected thereby, in each case except, for  the avoidance of doubt, as otherwise provided in Sections 9.09(d) and (e) (it being understood that, with the consent of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Lenders on substantially the same basis as the Loans and Commitments are included on the Closing Date),

 

(vi)                              release all or substantially all of the Collateral or all or substantially all of the Subsidiary Loan Parties from their respective Guarantees under the Subsidiary Guarantee Agreement, unless, in the case of a Subsidiary Loan Party, all or substantially all the Equity Interests of such Subsidiary Loan Party is sold or otherwise disposed of in a transaction permitted by this Agreement, without the prior written consent of each Lender other than a Defaulting Lender,

 

(vii)                           effect any waiver, amendment or modification that by its terms adversely affects the rights in respect of payments or collateral of Lenders participating in any Facility

 

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differently from those of Lenders participating in another Facility, without the consent of the Majority Lenders participating in the adversely affected Facility except, for the avoidance of doubt, as otherwise provided in Sections 9.09(d) and (e) (it being agreed that the Required Lenders may waive, in whole or in part, any prepayment or Commitment reduction required by Section 2.11 so long as the application of any prepayment or Commitment reduction still required to be made is not changed),

 

(viii)                        effect any waiver, amendment or modification of Section 5.02 of the Guarantee and Collateral Agreement or any comparable provision of any other Security Document, in a manner that materially adversely affects the rights in respect of payments or collateral of Lenders, without the consent of each Lender so affected,

 

(ix)                              effect any waiver, amendment or modification that imposes any additional restrictions on an Lender’s ability to assign its Loans, Commitments or other rights and obligations under this Agreement without the prior written consent of each Lender adversely effected thereby,

 

provided, further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, the Collateral Agent or an Issuing Bank hereunder without the prior written consent of the Administrative Agent, the Collateral Agent or such Issuing Bank acting as such at the effective date of such agreement, as applicable.  Each Lender shall be bound by any waiver, amendment or modification authorized by this Section 9.09 and any consent by any Lender pursuant to this Section 9.09 shall bind any Assignee of such Lender.

 

Notwithstanding anything to the contrary herein, no Defaulting Lender shall have the right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be affected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

 

(c)                                  Without the consent of any Lender or Issuing Bank, the Loan Parties, the Administrative Agent and the Collateral Agent may (in their respective sole discretion, or shall, to the extent required by any Loan Document) enter into any amendment, modification or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Parties, to include holders of Other First Liens in the benefit of the Security Documents in connection with the incurrence of any Other First Lien Debt, or as required by local law to give effect to, or protect any security interest for the benefit of the Secured Parties, in any property or so that the security interests therein comply with applicable law or this Agreement or in each case to otherwise enhance the rights or benefits of any Lender under any Loan Document.

 

(d)                                 Notwithstanding the foregoing, this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent, Holdings and the Borrower (a)  to permit additional extensions of credit to be outstanding hereunder from time to time and the accrued interest and fees and other obligations in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Term Loans and the Revolving Facility Loans and the accrued interest and fees and other obligations in respect thereof and (b) to include appropriately

 

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the holders of such extensions of credit in any determination of the requisite lenders required hereunder, including Required Lenders, Required Prepayment Lenders and the Required Revolving Facility Lenders.

 

(e)                                  Notwithstanding the foregoing, technical and conforming modifications to the Loan Documents may be made with the consent of the Borrower and the Administrative Agent (but without the consent of any Lender) to the extent necessary (A) to integrate any Incremental Term Loan Commitments or Incremental Revolving Facility Commitments in a manner consistent with Section 2.20, including, with respect to Other Revolving Facility Loans or Other Term Loans, as may be necessary to establish such Incremental Term Loan Commitments or Revolving Facility Loans as a separate Class or tranche from the existing Term Loan Commitments or Incremental Revolving Facility Commitments, as applicable, and, in the case of Extended Term Loans, to reduce the scheduled amortization of the related existing Class of Term Loans proportionately, (B) to integrate any Other First Lien Debt or (C) to cure any ambiguity, omission, defect or inconsistency.

 

(f)                                   Each of the parties hereto hereby agrees that the Administrative Agent may take any and all action as may be necessary to ensure that all Term Loans established pursuant to Section 2.20 after the Closing Date that will be included in an existing Class of Term Loans outstanding on such date (an “Applicable Date”), when originally made, are included in each Borrowing of outstanding Term Loans of such Class (the “Existing Class Loans”), on a pro rata basis, and/or to ensure that, immediately after giving effect to such new Term Loans (the “New Class Loans” and, together with the Existing Class Loans, the “Class Loans”), each Lender holding Class Loans will be deemed to hold its Pro Rata Share of each Class Loan on the Applicable Date (but without changing the amount of any such Lender’s Term Loans), and each such Lender shall be deemed to have effectuated such assignments as shall be required to ensure the foregoing.  The “Pro Rata Share” of any Lender on the Applicable Date is the ratio of (1) the sum of such Lender’s Existing Class Loans immediately prior to the Applicable Date plus the amount of New Class Loans made by such Lender on the Applicable Date over (2) the aggregate principal amount of all Class Loans on the Applicable Date.

 

(g)                                  With respect to the incurrence of any secured or unsecured Indebtedness (including any intercreditor agreement relating thereto), the Borrower may elect (in its discretion, but shall not be obligated) to deliver to the Administrative Agent a certificate of a Responsible Officer at least three Business Days prior to the incurrence thereof (or such shorter time as the Administrative Agent may agree in its reasonable discretion), together with either drafts of the material documentation relating to such Indebtedness or a description of such Indebtedness (including a description of the Liens intended to secure the same or the subordination provisions thereof, as applicable) in reasonably sufficient detail to be able to make the determinations referred to in this clause, which certificate shall either, at the Borrower’s election, (x) state that the Borrower has determined in good faith that such Indebtedness satisfies the requirements of the applicable provisions of Sections 6.01 and 6.02 (taking into account any other applicable provisions of this Section 9.09), in which case such certificate shall be conclusive evidence thereof, or (y) request the Administrative Agent to confirm, based on the information set forth in such certificate and any other information reasonably requested by the Administrative Agent, that such Indebtedness satisfies such requirements, in which case the Administrative Agent may determine whether, in its reasonable judgment, such requirements have been satisfied (in which case it shall deliver to the Borrower a written confirmation of the same), with any such determination of the Administrative Agent to be conclusive evidence thereof, and the Lenders hereby authorize the Administrative Agent to make such determinations.

 

(h)                                 Notwithstanding the foregoing, this Agreement may be amended, waived or otherwise modified with the written consent of the Required Revolving Facility Lenders, the Administrative Agent, Holdings and the Borrower with respect to the provisions of Section 4.01, solely as they relate to the Revolving Facility Loans and Letters of Credit.

 

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(i)                                     Notwithstanding the foregoing, this Agreement may be amended, with the written consent of each Revolving Facility Lender, the Administrative Agent, Holdings and the Borrower to the extent necessary to integrate any Alternate Currency.

 

SECTION 9.10                                           Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the applicable interest rate, together with all fees and charges that are treated as interest under applicable law (collectively, the “Charges”), as provided for herein or in any other document executed in connection herewith, or otherwise contracted for, charged, received, taken or reserved by any Lender or any Issuing Bank, shall exceed the maximum lawful rate (the “Maximum Rate”) that may be contracted for, charged, taken, received or reserved by such Lender in accordance with applicable law, the rate of interest payable hereunder, together with all Charges payable to such Lender or such Issuing Bank, shall be limited to the Maximum Rate; provided that such excess amount shall be paid to such Lender or such Issuing Bank on subsequent payment dates to the extent not exceeding the legal limitation.

 

SECTION 9.11                                           [Reserved].

 

SECTION 9.12                                           Entire Agreement.  This Agreement, the other Loan Documents and the agreements regarding certain Fees referred to herein constitute the entire contract between the parties relative to the subject matter hereof.  Any previous agreement among or representations from the parties or their Affiliates with respect to the subject matter hereof is superseded by this Agreement and the other Loan Documents.  Notwithstanding the foregoing, the Fee Letter shall survive the execution and delivery of this Agreement and remain in full force and effect.  Nothing in this Agreement or in the other Loan Documents, expressed or implied, is intended to confer upon any party other than the parties hereto and thereto any rights, remedies, obligations or liabilities under or by reason of this Agreement or the other Loan Documents.

 

SECTION 9.13                                           WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY IRREVOCABLY 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 ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON 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 AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.13.

 

SECTION 9.14                                           Severability.  In the event any one or more of the provisions contained in this Agreement or in any other Loan Document should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein shall not in any way be affected or impaired thereby.  The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.  Without limiting the foregoing provisions of this Section 9.14, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent and any Issuing Bank, then such provisions shall be deemed to be in effect only to the extent not so limited.

 

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SECTION 9.15                                           Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall constitute an original but all of which, when taken together, shall constitute but one contract, and shall become effective as provided in Section 9.03.  Delivery of an executed counterpart to this Agreement by facsimile (or other electronic) transmission pursuant to procedures approved by the Administrative Agent shall be as effective as delivery of a manually signed original.

 

SECTION 9.16                                           Headings.  Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.

 

SECTION 9.17                                           Jurisdiction; Consent to Service of Process.

 

(a)                                 Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the extent permitted by law, in such federal court.  Each of the parties hereto 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.  Nothing in this Agreement shall affect any right that any Lender or any Issuing Bank may otherwise have to bring any action or proceeding relating to this Agreement or the other Loan Documents against Holdings, the Borrower or any other Loan Party or their properties in the courts of any jurisdiction.

 

(b)                                 Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that 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 other Loan Documents in any New York State or federal court.  Each of the parties hereto hereby irrevocably 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.

 

(c)                                  Each of the parties hereto hereby irrevocably consents to service of process in the manner provided for notices in Section 9.01.  Nothing in this Agreement will affect the right of any party to this Agreement or any other Loan Document to serve process in any other manner permitted by law.

 

SECTION 9.18                                           Confidentiality.  Each of the Lenders, each Issuing Bank and each of the Agents agrees that it shall maintain in confidence any information relating to any Parent Entity, Holdings, the Borrower and any Subsidiary furnished to it by or on behalf of any Parent Entity, Holdings, the Borrower or any Subsidiary (other than information that (a) has become generally available to the public other than as a result of a disclosure by such party, (b) has been independently developed by such Lender, such Issuing Bank or such Agent without violating this Section 9.18 or (c) was available to such Lender, such Issuing Bank or such Agent on a nonconfidential basis from a third party having, to such person’s knowledge, no obligations of confidentiality to any Parent Entity, Holdings, the Borrower or any Subsidiary) and shall not reveal the same other than to its directors, trustees, officers, employees and advisors with a need to know or to any person that approves or administers the Loans on behalf of such Lender (so long as each such person shall have been instructed to keep the same confidential in accordance with this Section 9.18), except:  (a) to the extent necessary to comply with law or any legal process or the requirements of any Governmental Authority (provided that the Lenders, each Issuing Bank, or the Agents will, to the extent practical, provide reasonable notice to any Parent Entity, Holdings,

 

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the Borrower or any Subsidiary to allow them an opportunity to request a protective order or other measure ensuring confidential treatment of the information), the National Association of Insurance Commissioners or of any securities exchange on which securities of the disclosing party or any Affiliate of the disclosing party are listed or traded, (b) as part of normal reporting or review procedures to Governmental Authorities or the National Association of Insurance Commissioners, (c) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, trustees, advisors and representatives (so long as each such person shall have been instructed to keep the same confidential in accordance with this Section 9.18), (d) in order to enforce its rights under any Loan Document in a legal proceeding, and (e) subject to a written agreement containing provisions substantially similar to this Section 9.18, (1) to any prospective assignee of, or prospective Participant in, any of its rights under this Agreement, or (2) to any direct or indirect contractual counterparty in Swap Agreements or such contractual counterparty’s professional advisor (so long as such professional advisor to such contractual counterparty agrees to be bound by the provisions of this Section), (g) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, or (h) subject to an agreement containing provisions substantially the same as those of this Section.

 

SECTION 9.19                                           Direct Website Communications.

 

(a)                                 Delivery.  Each Loan Party hereby agrees that it will provide to the Administrative Agent all information, documents and other materials that it is obligated to furnish to the Administrative Agent pursuant to this Agreement and any other Loan Document, including all notices, requests, financial statements, financial and other reports, certificates and other information materials, but excluding any such communication that (a) relates to a request for a new, or a conversion of an existing, Borrowing or other extension of credit (including any election of an interest rate or interest period relating thereto), (b) relates to the payment of any principal or other amount due under this Agreement prior to the scheduled date therefor, (c) provides notice of any Default or Event of Default under this Agreement or (d) is required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement and/or any Borrowing or other extension of credit hereunder (all such non-excluded communications collectively, the “Communications”), by transmitting the Communications in an electronic/soft medium in a format acceptable to the Administrative Agent.  In addition, each Loan Party agrees to continue to provide the Communications to the Administrative Agent in the manner specified in this Agreement or any other Loan Document but only to the extent requested by the Administrative Agent.  Nothing in this Section 9.19 shall prejudice the right of the Agents, the Joint Lead Arrangers or any Lender or any Loan Party to give any notice or other communication pursuant to this Agreement or any other Loan Document in any other manner specified in this Agreement or any other Loan Document.

 

(i)                                     The Administrative Agent agrees that receipt of the Communications by the Administrative Agent at its e-mail address set forth in Section 9.01 shall constitute effective delivery of the Communications to the Administrative Agent for purposes of the Loan Documents.  Each Lender agrees that notice to it (as provided in the next sentence) specifying that the Communications have been posted to the Platform (as defined below) shall constitute effective delivery of the Communications to such Lender for purposes of the Loan Documents.  Each Lender agrees (a) to notify the Administrative Agent in writing (including by electronic communication) from time to time of such Lender’s e-mail address to which the foregoing notice may be sent by electronic transmission and (b) that the foregoing notice may be sent to such e-mail address.

 

(b)                                 Posting.  The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Joint Lead Arrangers will make the Communications available to the Lenders and each Issuing Bank  by posting the Communications on IntraLinks or another similar electronic system (the

 

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“Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to Holdings, the Borrower or their Subsidiaries or Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such person’s securities.  The Borrower hereby agrees that it will use commercially reasonable efforts to identify that portion of the Communications that may be distributed to the Public Lenders and that (w) all such Communications shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Communications “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, each Joint Lead Arranger, each Issuing Bank and the Lenders to treat such Communications as solely containing information that is either (A) publicly available information or (B) not material (although it may be sensitive and proprietary) with respect to Holdings, the Borrower or its Subsidiaries or any of their respective securities for purposes of United States federal and state securities laws (provided, however, that to the extent such Communications constitute Information, they shall be treated as set forth in Section 9.18); (y) all Communications marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information;” and (z) the Administrative Agent and each Joint Lead Arranger shall be entitled to treat any Communications that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”

 

(c)                                  Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE COMMUNICATIONS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM.  In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower, any Lender, any Issuing Bank or any other person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Communications through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall any Agent Party have any liability to the Borrower, any Lender, any Issuing Bank or any other person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

 

SECTION 9.20                                           Release of Liens and Guarantees.

 

(a)                                 The Lenders, the Issuing Banks and the other Secured Parties hereby irrevocably agree that the Liens granted to the Collateral Agent by the Loan Parties on any Collateral shall be automatically released: (i) in full upon the occurrence of the Termination Date as set forth in Section 9.20(d) below; (ii) upon the Disposition of such Collateral by any Loan Party to a person that is not (and is not required to become) a Loan Party in a transaction not prohibited by this Agreement (and the Collateral Agent may rely conclusively on a certificate to that effect provided to it by any Loan Party upon its reasonable request without further inquiry), (iii) to the extent that such Collateral comprises property leased to a Loan Party, upon termination or expiration of such lease (and the Collateral Agent may rely conclusively on a certificate to that effect provided to it by any Loan Party upon its reasonable request without further inquiry), (iv) if the release of such Lien is approved, authorized or ratified in writing by the Required Lenders (or such other percentage of the Lenders whose consent may be required

 

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in accordance with Section 9.09), (v) to the extent that the property constituting such Collateral is owned by any Guarantor, upon the release of such Guarantor from its obligations under the Guarantee in accordance with the Holdings Guarantee and Pledge Agreement, the Subsidiary Guarantee Agreement or clause (b) below (and the Collateral Agent may rely conclusively on a certificate to that effect provided to it by any Loan Party upon its reasonable request without further inquiry), (vi) as provided in Section 8.10 (and the Collateral Agent may rely conclusively on a certificate to that effect provided to it by any Loan Party upon its reasonable request without further inquiry), and (vii) as required by the Collateral Agent to effect any Disposition of Collateral in connection with any exercise of remedies of the Collateral Agent pursuant to the Security Documents.  Any such release (other than pursuant to clause (i) above) shall not in any manner discharge, affect, or impair the Obligations or any Liens (other than those being released) upon (or obligations (other than those being released) of the Loan Parties in respect of) all interests retained by the Loan Parties, including the proceeds of any Disposition, all of which shall continue to constitute part of the Collateral except to the extent otherwise released in accordance with the provisions of the Loan Documents.

 

(b)                                 In addition, the Lenders, the Issuing Banks and the other Secured Parties hereby irrevocably agree that the Guarantors shall be automatically released from the Guarantees upon consummation of any transaction not prohibited hereunder resulting in such Subsidiary ceasing to constitute a Subsidiary Loan Party or otherwise becoming an Excluded Subsidiary (and the Collateral Agent may rely conclusively on a certificate to that effect provided to it by any Loan Party upon its reasonable request without further inquiry).

 

(c)                                  The Lenders, the Issuing Banks and the other Secured Parties hereby authorize the Administrative Agent and the Collateral Agent, as applicable, to execute and deliver any instruments, documents, and agreements necessary or desirable to evidence and confirm the release of any Guarantor or Collateral pursuant to the foregoing provisions of this Section 9.20, and to return to Holdings or the Borrower all possessory collateral (including share certificates (if any)) held by it in respect of any Collateral so released,  all without the further consent or joinder of any Lender or any other Secured Party.  Any representation, warranty or covenant contained in any Loan Document relating to any such Collateral or Guarantor shall no longer be deemed to be made.  In connection with any release hereunder, the Administrative Agent and the Collateral Agent shall promptly (and the Secured Parties hereby authorize the Administrative Agent and the Collateral Agent to) take such action and execute any such documents as may be reasonably requested by the Borrower and at the Borrower’s expense in connection with the release of any Liens created by any Loan Document in respect of such Subsidiary, property or asset; provided that the Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower containing such certifications as the Administrative Agent shall reasonably request.

 

(d)                                 Notwithstanding anything to the contrary contained herein or any other Loan Document, on the Termination Date, all Liens granted to the Collateral Agent by the Loan Parties on any Collateral and all obligations of the Borrower and the other Loan Parties under any Loan Documents (other than such obligations that expressly survive the Termination Date pursuant to the terms hereof) shall, in each case, be automatically released and, upon request of the Borrower, the Administrative Agent and/or the Collateral Agent, as applicable, shall (without notice to, or vote or consent of, any Secured Party) take such actions as shall be required to evidence the release its security interest in all Collateral (including returning to Holdings or the Borrower all possessory collateral (including all share certificates (if any)) held by it in respect of any Collateral), and to evidence the release or all obligations under any Loan Document (other than such obligations that expressly survive the Termination Date pursuant to the terms hereof), whether or not on the date of such release there may be any (i) obligations in respect of any Secured Swap Agreements or any Secured Cash Management Agreements and (ii) any contingent indemnification obligations or expense reimburse claims not then due; provided that the Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower containing such

 

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certifications as the Administrative Agent shall reasonably request.  Any such release of obligations shall be deemed subject to the provision that such obligations shall be reinstated if after such release any portion of any payment in respect of the obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payment had not been made.  The Borrower agrees to pay all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent or the Collateral Agent (and their respective representatives) in connection with taking such actions to release security interest in all Collateral and all obligations under the Loan Documents as contemplated by this Section 9.20(d). A copy of any request, document, instrument or certificate delivered to the Collateral Agent pursuant to this Section 9.20 shall be simultaneously delivered to the Administrative Agent.

 

(e)                                  Obligations of the Borrower or any of its Subsidiaries under any Secured Cash Management Agreement or Secured Swap Agreement (after giving effect to all netting arrangements relating to such Secured Swap Agreements) shall be secured and guaranteed pursuant to the Security Documents only to the extent that, and for so long as, the other Obligations are so secured and guaranteed.  No person shall have any voting rights under any Loan Document solely as a result of the existence of obligations owed to it under any such Secured Swap Agreement or Secured Cash Management Agreement.  For the avoidance of doubt, no release of Collateral or Guarantors effected in the manner permitted by this Agreement shall require the consent of any holder of obligations under Secured Swap Agreements or any Secured Cash Management Agreements.

 

SECTION 9.21                                           Intercreditor Agreement Authorization.  The Lenders and each other Secured Party hereunder irrevocably authorize and instruct the Collateral Agent to, without any further consent of any Lender or any other Secured Party, enter into (or acknowledge and consent to) or amend, renew, extend, supplement, restate, replace, waive or otherwise modify any Pari First Lien Intercreditor Agreement, any First Lien/Second Lien Intercreditor Agreement, any other Permitted Junior Intercreditor Agreement, any other Permitted Pari Passu Intercreditor Agreement or any other intercreditor agreement with the collateral agent or other representatives of the holders of Indebtedness that is to be secured by a Lien on the Collateral that is not prohibited (including with respect to priority) under this Agreement and to subject the Liens on the Collateral securing the Obligations to the provisions thereof (any of the foregoing, an “Intercreditor Agreement”).  The Lenders and the other Secured Parties irrevocably agree that (x) the Collateral Agent may rely exclusively on a certificate of a Responsible Officer of the Borrower as to whether any such other Liens are not prohibited and (y) any Intercreditor Agreement entered into by the Collateral Agent shall be binding on the Secured Parties, and each Lender and the other Secured Parties hereby agree that it will take no actions contrary to the provisions of, if entered into and if applicable, any Intercreditor Agreement.

 

SECTION 9.22                                           U.S.A. Patriot Act.  Each Lender hereby notifies the Borrower that pursuant to the requirements of the U.S.A. Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the U.S.A. Patriot Act.

 

SECTION 9.23                                           No Advisory or Fiduciary Relationship.  In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees that:  (i) (A) the arranging and other services regarding this Agreement provided by the Administrative Agent, the Joint Lead Arrangers, the other Agents and the Lenders are arm’s-length commercial transactions

 

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between the Borrower and its Affiliates, on the one hand, and the Administrative Agent, the Joint Lead Arranger, the other Agents and the Lenders, on the other hand, (B) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each of the Administrative Agent, each Joint Lead Arranger, each other Agent and each Lender is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any other person and (B) neither the Administrative Agent, any Joint Lead Arranger, nor any other Agent or Lender has any obligation to the Borrower or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent, the Joint Lead Arrangers, the other Agents, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and neither the Administrative Agent, any Joint Lead Arranger, nor any of other Agent or Lender has any obligation to disclose any of such interests to the Borrower or its Affiliates.  To the fullest extent permitted by law, the Borrower hereby waives and releases any claims that it may have against the Administrative Agent, the Joint Lead Arrangers, the other Agents and the Lenders with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

 

SECTION 9.24                                           Affiliate Lenders.

 

(a)                                 Each Lender who is an Affiliate of the Borrower, excluding (x) Holdings, the Borrower and their respective Subsidiaries and (y) any Debt Fund Affiliate Lender (each, an “Affiliate Lender”; it being understood that (x) neither Holdings, the Borrower, nor any of their Subsidiaries may be Affiliate Lenders and (y) Debt Fund Affiliate Lenders and Affiliate Lenders may be Lenders hereunder in accordance with Section 9.04, subject in the case of Affiliate Lenders, to this Section 9.24), in connection with any (i) consent (or decision not to consent) to any amendment, modification, waiver, consent or other action with respect to any of the terms of any Loan Document, (ii) other action on any matter related to any Loan Document or (iii) direction to the Administrative Agent, the Collateral Agent or any Lender to undertake any action (or refrain from taking any action) with respect to or under any Loan Document, agrees that, except with respect to any amendment, modification, waiver, consent or other action (1) described in clauses (i), (ii), (iii) or (iv) of the first proviso of Section 9.09(b) or (2) that adversely affects such Affiliate Lender (in its capacity as a Lender) in a disproportionately adverse manner as compared to other Lenders, such Affiliate Lender shall be deemed to have voted its interest as a Lender without discretion in such proportion as the allocation of voting with respect to such matter by Lenders who are not Affiliate Lenders.  Each Affiliate Lender hereby irrevocably appoints the Administrative Agent (such appointment being coupled with an interest) as such Affiliate Lender’s attorney-in-fact, with full authority in the place and stead of such Affiliate Lender and in the name of such Affiliate Lender, from time to time in the Administrative Agent’s discretion to take any action and to execute any instrument that the Administrative Agent may deem reasonably necessary to carry out the provisions of this clause (a).

 

(b)                                 Notwithstanding anything to the contrary in this Agreement, no Affiliate Lender shall have any right to (1) attend (including by telephone) any meeting or discussions (or portion thereof) among the Administrative Agent or any Lender to which representatives of the Borrower are not then present, (2) receive any information or material prepared by Administrative Agent or any Lender or any communication by or among Administrative Agent and/or one or more Lenders, except to the extent such information or materials have been made available to the Borrower or its representatives, (3) make or bring (or participate in, other than as a passive participant in or recipient of its pro rata benefits of) any claim, in its capacity as a Lender, against Administrative Agent, the Collateral Agent or any other Lender

 

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with respect to any duties or obligations or alleged duties or obligations of such Agent or any other such Lender under the Loan Documents, (4) purchase any Term Loan if, immediately after giving effect to  such purchase, Affiliate Lenders in the aggregate would own Term Loans with an aggregate principal amount in excess of 25% of the aggregate principal amount of all Term Loans then outstanding or (5) purchase any Revolving Facility Loans or Revolving Facility Commitments.  It shall be a condition precedent to each assignment to an Affiliate Lender that such Affiliate Lender shall have (x) represented to the assigning Lender in the applicable Assignment and Acceptance, and notified the Administrative Agent, that it is (or will be, following the consummation of such assignment) an Affiliate Lender and that the aggregate amount of Term Loans held by it giving effect to such assignments shall not exceed the amount permitted by clause (4) of the preceding sentence and (y) represented in the applicable Assignment and Acceptance that it is not in possession of material non-public information (within the meaning of United States federal and state securities laws) with respect to Holdings, the Borrower, its Subsidiaries or their respective securities (or, if Holdings is not at the time a public reporting company, material information of a type that would not be reasonably expected to be publicly available if Holdings were a public reporting company) that (A) has not been disclosed to the assigning Lender or the Lenders generally (other than because any such Lender does not wish to receive material non-public information with respect to Holdings, the Borrower or its Subsidiaries) and (B) could reasonably be expected to have a material effect upon, or otherwise be material to, the assigning Lender’s decision make such assignment.

 

SECTION 9.25                                           Judgment Currency.  If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due hereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Administrative Agent could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given.  The obligation of the Borrower in respect of any such sum due from it to the Administrative Agent or the Lenders hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receipt by the Administrative Agent of any sum adjudged to be so due in the Judgment Currency, the Administrative Agent may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency.  If the amount of the Agreement Currency so purchased is less than the sum originally due to the Administrative Agent from the Borrower in the Agreement Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent or the person to whom such obligation was owing against such loss.  If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Administrative Agent in such currency, the Administrative Agent agrees to return the amount of any excess to the Borrower (or to any other person who may be entitled thereto under applicable law).

 

SECTION 9.26                                           Agency of the Borrower for the Loan Parties.  Each of the other Loan Parties hereby appoints the Borrower as its agent for all purposes relevant to this Agreement and the other Loan Documents, including the giving and receipt of notices and the execution and delivery of all documents, instruments and certificates contemplated herein and therein and all modifications hereto and thereto.

 

SECTION 9.27                                           Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Solely to the extent any Lender or Issuing Bank that is an EEA Financial Institution is a party to this Agreement and notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender or Issuing Bank that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion

 

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powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)                                 the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender or Issuing Bank that is an EEA Financial Institution; and

 

(b)                                 the effects of any Bail-In Action on any such liability, including, if applicable:

 

(i)                                     a reduction in full or in part or cancellation of any such liability;

 

(ii)                                  a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii)                               the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

 

SECTION 9.28                                           Original Credit Agreement; Effectiveness of Amendment and Restatement.  On and after the Repricing Effective Date, all obligations of the Loan Parties under the Original Credit Agreement shall become obligations of the Loan Parties hereunder and the provisions of the Original Credit Agreement shall be superseded by the provisions hereof except for provisions under the Original Credit Agreement that expressly survive the termination thereof. The parties hereto acknowledge and agree that (a) the amendment and restatement of the Original Credit Agreement pursuant to this Agreement and all other Loan Documents executed and delivered in connection herewith shall not constitute a novation of the Original Credit Agreement and the other Loan Documents as in effect prior to the Repricing Effective Date and (b) all references in the other Loan Documents to the Original Credit Agreement shall be deemed to refer without further amendment to this Agreement.

 

[Signature Pages Follow]

 

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