Document:

Exhibit 10.1

 

Amendment No. 1 to Employment Agreement

By and between RegeneRx Biopharmaceuticals, Inc. and C. Neil Lyons

Dated April 12, 2007

 

Section 12.2.
(b) is replaced in its entirety with the following:

 

	
  12.2

  	
   

  	
  Severance.

  

 

 

(b) Severance with respect to
any termination under 12.2 (a) shall include and be calculated as follows:
six (6) months Severance upon termination at any time through April 18,
2008, the third anniversary of Executive’s employment with the Company, twelve
(12) months Severance upon termination thereafter. Severance shall include
salary and medical and dental insurance payments as describe herein.

 

 

Acknowledged
and agreed:

 

RegeneRx
Biopharmaceuticals, Inc.

 

 

 

 

	
        /s/
  J.J. Finkelstein

  
	
  J.J.
  Finkelstein

  
	
  President
  and Chief Executive Officer

  

Dated:  December 17, 2007

 

	
        /s/
  C. Neil Lyons

  
	
  C.
  Neil Lyons

  

Dated:  December 17, 2007Exhibit 10.1

 

COMMERCIAL PAPER DEALER AGREEMENT

4(2) PROGRAM

 

 

between

 

TRANSOCEAN INC., as Issuer

 

and

 

LEHMAN BROTHERS INC., as Dealer

 

Concerning Notes to be issued pursuant to an
Issuing and Paying Agency Agreement dated as of December 20, 2007 between
the Issuer and Citibank NA, as Issuing and Paying Agent

 

 

Dated as of

December 20, 2007

 

 

Commercial Paper Dealer Agreement

4(2) Program

 

This agreement (the “Agreement”) sets forth the
understandings between the Issuer and the Dealer, each named on the cover page hereof,
in connection with the issuance and sale by the Issuer of its short-term
promissory notes (the “Notes”) through the Dealer.

 

Certain terms used in this Agreement are defined in Section 6
hereof.

 

The Addendum to this Agreement, and any Annexes or
Exhibits described in this Agreement or such Addendum, are hereby incorporated
into this Agreement and made fully a part hereof.

 

1.              Offers, Sales and Resales of
Notes.

 

1.1                     While (i) the Issuer has and shall have no
obligation to sell the Notes to the Dealer or to permit the Dealer to arrange
any sale of the Notes for the account of the Issuer, and (ii) the Dealer
has and shall have no obligation to purchase the Notes from the Issuer or to
arrange any sale of the Notes for the account of the Issuer, the parties hereto
agree that in any case where the Dealer purchases Notes from the Issuer, or
arranges for the sale of Notes by the Issuer, such Notes will be purchased or
sold by the Dealer in reliance on the representations, warranties, covenants and
agreements of the Issuer contained herein or made pursuant hereto and on the
terms and conditions and in the manner provided herein and sold by the Issuer
in reliance on the representations, warranties, covenants and agreements of the
Dealer contained herein or made pursuant hereto and on the terms and conditions
and in the manner provided herein.

 

1.2                     So long as this Agreement shall remain in effect, and
in addition to the limitations contained in Section 1.7 hereof, the Issuer
shall not, without the consent of the Dealer which consent shall not be
unreasonably withheld or delayed, offer, solicit or accept offers to purchase,
or sell, any Notes except (a) in transactions with one or more dealers
which may from time to time after the date hereof become dealers with
respect to the Notes by executing with the Issuer one or more agreements which
contain provisions substantially identical to those contained in Section 1
of this Agreement, of which the Issuer hereby undertakes to provide the Dealer
prompt notice or (b) in transactions with the other dealers listed on the
Addendum hereto, which are executing agreements with the Issuer which contain
provisions substantially identical to Section 1 of this Agreement
contemporaneously herewith. In no event shall the Issuer offer, solicit or
accept offers to purchase, or sell, any Notes directly on its own behalf in
transactions with persons other than broker-dealers as specifically permitted
in this Section 1.2.

 

1.3                     The Notes shall be in a minimum denomination of $250,000
or integral multiples of $1,000 in excess thereof, will bear such interest
rates, if interest bearing, or will be sold at such discount from their face
amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a
maturity not exceeding 397 days from the date of issuance (exclusive of days of
grace) and may have such terms as are specified in Exhibit C hereto
or the Private Placement Memorandum. The Notes shall not contain any provision
for extension, renewal or automatic “rollover.”

 

1.4                     The authentication and issuance of, and payment for,
the Notes shall be effected in accordance with the Issuing and Paying Agency
Agreement, and the Notes shall be either individual physical certificates or
book-entry notes evidenced by one or more master notes (each, a “Master Note”)
registered in the name of The Depository Trust Company (“DTC”) or its nominee,
in the form or forms annexed to the Issuing and Paying Agency Agreement.

 

2

 

1.5                     If the Issuer and the Dealer shall agree on the terms
of the purchase of any Note by the Dealer or the sale of any Note arranged by
the Dealer (including, but not limited to, agreement with respect to the date
of issue, purchase price, principal amount, maturity and interest rate or
interest rate index and margin (in the case of interest-bearing Notes) or
discount thereof (in the case of Notes issued on a discount basis), and
appropriate compensation for the Dealer’s services hereunder) pursuant to this
Agreement, the Issuer shall cause such Note to be issued and delivered in
accordance with the terms of the Issuing and Paying Agency Agreement and
payment for such Note shall be made by the purchaser thereof, either directly
or through the Dealer, to the Issuing and Paying Agent, for the account of the
Issuer. Except as otherwise agreed, in the event that the Dealer is acting as
an agent and a purchaser shall either fail to accept delivery of or make
payment for a Note on the date fixed for settlement, the Dealer shall promptly
notify the Issuer, and if the Dealer has theretofore paid the Issuer for the
Note, the Issuer will promptly return such funds to the Dealer against its
return of the Note to the Issuer, in the case of a certificated Note, and upon
notice of such failure in the case of a book-entry Note. If such failure
occurred for any reason other than default by the Dealer, the Issuer shall
reimburse the Dealer on an equitable basis for the Dealer’s loss of the use of
such funds for the period such funds were credited to the Issuer’s account.

 

1.6                     The Dealer and the Issuer hereby establish and agree
to observe the following procedures in connection with offers, sales and
subsequent resales or other transfers of the Notes:

 

(a)          Offers and sales of the Notes by or through the Dealer
shall be made only to: (i) investors reasonably believed by the Dealer to
be Qualified Institutional Buyers, Institutional Accredited Investors or
Sophisticated Individual Accredited Investors and (ii) non-bank
fiduciaries or agents that will be purchasing Notes for one or more accounts,
each of which is reasonably believed by the Dealer to be a Qualified
Institutional Buyer, an Institutional Accredited Investor or Sophisticated
Individual Accredited Investor.

 

(b)         Resales and other transfers of the Notes by the
holders thereof shall be made only in accordance with the restrictions in the
legend described in clause (e) below and to the extent such resale is made
to or through the Dealer, the Dealer will comply with the provisions of such
legend and this Section 1.6.

 

(c)          No general solicitation or general advertising shall
be used in connection with the offering of the Notes. Without limiting the
generality of the foregoing, without the prior written approval of the Dealer,
the Issuer shall not issue any press release or place or publish any “tombstone”
or other advertisement relating to the Notes. Notwithstanding the foregoing,
any publication by the Issuer of a notice in accordance with Rule 135c
under the Securities Act shall not be deemed to constitute general solicitation
or general advertising hereunder and shall not require prior written approval
of the Dealer.

 

(d)         No sale of Notes to any one purchaser shall be for
less than $250,000 principal or face amount, and no Note shall be issued in a
smaller principal or face amount. If the purchaser is a non-bank fiduciary or
agent acting on behalf of others, each person for whom such purchaser is acting
must purchase at least $250,000 principal or face amount of Notes.

 

(e)          Offers and sales of the Notes by the Issuer through
the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506
under the Securities Act, and shall be subject to the restrictions described in
the legend appearing on Exhibit A hereto. A legend substantially to the
effect of such Exhibit A shall appear as part of the Private
Placement 

 

3

 

Memorandum used in
connection with offers and sales of Notes hereunder, as well as on each
individual certificate representing a Note and each Master Note representing
book-entry Notes offered and sold pursuant to this Agreement.

 

(f)            The Dealer shall furnish or shall have furnished to
each purchaser of Notes for which it has acted as the Dealer a copy of the
then-current Private Placement Memorandum unless such purchaser has previously
received a copy of the Private Placement Memorandum as then in effect. The
Private Placement Memorandum shall expressly state that any person to whom
Notes are offered shall have an opportunity to ask questions of, and receive
information from, the Issuer and the Dealer and shall provide the addresses and
telephone numbers for obtaining further information regarding the Issuer.

 

(g)         The Issuer agrees, for the benefit of the Dealer and
each of the holders and prospective purchasers from time to time of the Notes
that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of
the Exchange Act, the Issuer will furnish, upon request and at its expense, to
the Dealer and to holders and prospective purchasers of Notes information
required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d).

 

(h)         In the event that any Note offered or to be offered by
the Dealer would be ineligible for resale under Rule 144A, the Issuer
shall promptly notify the Dealer (by telephone, confirmed in writing) of such
fact and shall promptly prepare and deliver to the Dealer an amendment or
supplement to the Private Placement Memorandum describing the Notes that are
ineligible, the reason for such ineligibility and any other relevant
information relating thereto.

 

(i)             The Issuer represents that it is not currently issuing
commercial paper in the United States market in reliance upon the exemption
provided by Section 3(a)(3) of the Securities Act. The Issuer agrees
that, if it shall issue commercial paper after the date hereof in reliance upon
such exemption (a) the proceeds from the sale of the Notes will be
segregated from the proceeds of the sale of any such commercial paper by being
placed in a separate account; (b) the Issuer will institute appropriate
corporate procedures to ensure that the offers and sales of notes issued by the
Issuer pursuant to the Section 3(a)(3) exemption are not integrated
with offerings and sales of Notes hereunder; and (c) the Issuer will
comply with each of the requirements of Section 3(a)(3) of the
Securities Act in selling commercial paper or other short-term debt securities
other than the Notes in the United States.

 

(j)             The Issuer hereby agrees that, not later than 15 days
after the first sale of Notes as contemplated by this Agreement, it will file
with the SEC a notice on Form D in accordance with Rule 503 under the
Securities Act and that it will thereafter file such amendments to such notice
as Rule 503 may require.

 

1.7                                 The Issuer hereby represents and warrants
to the Dealer, in connection with offers, sales and resales of Notes, as
follows:

 

(a)         The Issuer hereby confirms to the Dealer that (except
as permitted by Section 1.6(i)) within the preceding six months neither
the Issuer nor any person other than the Dealer or the other dealers referred
to in Section 1.2 hereof acting on behalf of the Issuer has offered or
sold any Notes, or any substantially similar security of the Issuer (including,
without limitation, medium-term notes issued by the Issuer), to, or solicited
offers to buy any such security from, any person other than the Dealer or the
other dealers referred to in Section 1.2 hereof. The Issuer also agrees
that (except as permitted by Section 1.6(i)), as long as the Notes are
being 

 

4

 

offered for sale by the Dealer and the other dealers
referred to in Section 1.2 hereof as contemplated hereby and until at
least six months after the offer of Notes hereunder has been terminated,
neither the Issuer nor any person other than the Dealer or the other dealers
referred to in Section 1.2 hereof (except as contemplated by Section 1.2
hereof) will offer the Notes or any substantially similar security of the
Issuer for sale to, or solicit offers to buy any such security from, any person
other than the Dealer or the other dealers referred to in Section 1.2
hereof, it being understood that such agreement is made with a view to bringing
the offer and sale of the Notes within the exemption provided by Section 4(2) of
the Securities Act and Rule 506 thereunder and shall survive any
termination of this Agreement. The Issuer hereby represents and warrants that
it has not taken or omitted to take, and will not take or omit to take, any
action that would cause the offering and sale of Notes hereunder to be
integrated with any other offering of securities, whether such offering is made
by the Issuer or some other party or parties, under circumstances that would
cause the offering and sales of the Notes by the Issuer to fail to be exempt
under Section 4(2) of the Securities Act and Rule 506
thereunder.

 

(b)        The Issuer represents and agrees that the proceeds of
the sale of the Notes are not currently contemplated to be used for the purpose
of buying, carrying or trading securities within the meaning of Regulation T
and the interpretations thereunder by the Board of Governors of the Federal
Reserve System. In the event that the Issuer determines to use such proceeds
for the purpose of buying, carrying or trading securities, whether in
connection with an acquisition of another company or otherwise, the Issuer
shall give the Dealer at least three business days’ prior written notice to
that effect but shall not be required to identify or disclose such securities. The
Issuer shall also give the Dealer prompt notice of the actual date that it
commences to purchase securities with the proceeds of the Notes. Thereafter, in
the event that the Dealer purchases Notes as principal and does not resell such
Notes on the day of such purchase, to the extent necessary to comply with
Regulation T and the interpretations thereunder, the Dealer will sell such
Notes either (i) only to offerees it reasonably believes to be Qualified
Institutional Buyers or to Qualified Institutional Buyers it reasonably
believes are acting for other Qualified Institutional Buyers, in each case in
accordance with Rule 144A or (ii) in a manner which would not cause a
violation of Regulation T and the interpretations thereunder.

 

1.8                                The Dealer agrees from time to time upon
request of the Issuer to inform the Issuer whether it is holding Notes
purchased from the Issuer that it has not yet sold or Notes that have been sold
and subsequently repurchased by the Dealer (specifying in which category each
Note so held belongs) and the amount, issue date, maturity and interest rate,
if applicable, of each such Note.

 

2.              Representations
and Warranties of Issuer.

                        The Issuer represents and warrants that:

 

2.1                     The Issuer is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and has all the requisite power and authority to execute, deliver
and perform its obligations under the Notes, this Agreement and the
Issuing and Paying Agency Agreement.

 

2.2                     This Agreement and the Issuing and Paying Agency
Agreement have been duly authorized, executed and delivered by the Issuer and
constitute legal, valid and binding obligations of the Issuer enforceable
against the Issuer in accordance with their terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors’ rights generally,
and subject, as to 

 

5

 

enforceability, to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).

 

2.3                    The Notes have been duly authorized, and when issued
as provided in the Issuing and Paying Agency Agreement, will be duly and
validly issued and will constitute legal, valid and binding obligations of the
Issuer enforceable against the Issuer in accordance with their terms, subject
to applicable bankruptcy, insolvency and similar laws affecting creditors’
rights generally, and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding in equity
or at law).

 

2.4                    Assuming compliance by the Dealer with the procedures
applicable to it set forth in Section 1, the offer and sale of the Notes
in the manner contemplated hereby do not require registration of the Notes
under the Securities Act, pursuant to the exemption from registration contained
in Section 4(2) thereof and Regulation D thereunder, and no indenture
in respect of the Notes is required to be qualified under the Trust Indenture
Act of 1939, as amended.

 

2.5                    The Notes will rank at least pari passu with all other
unsecured and unsubordinated indebtedness of the Issuer.

 

2.6                    Except as provided in Section 1.6(j) hereof,
and assuming compliance by the Dealer with the procedures set forth in Section 1,
no consent or action of, or filing or registration with, any governmental or
public regulatory body or authority, including the SEC, is required to
authorize, or is otherwise required in connection with the execution, delivery
or performance of, this Agreement, the Notes or the Issuing and Paying Agency
Agreement, except for the filing of Form D pursuant to Rule 503 under
the Securities Act or as may be required by the securities or Blue Sky
laws of the various states in connection with the offer and sale of the Notes.

 

2.7                    Neither the execution and delivery of this Agreement
and the Issuing and Paying Agency Agreement, nor the issuance of the Notes in
accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of
or compliance with the terms and provisions hereof or thereof by the Issuer,
will (i) result in the creation or imposition of any mortgage, lien,
charge or encumbrance of any nature whatsoever upon any of the properties or
assets of the Issuer, or (ii) violate or result in a breach or a default
under any of the terms of the Issuer’s charter documents or by-laws, any
contract or instrument to which the Issuer is a party or by which it or its
property is bound, or any law or regulation, or any order, writ, injunction or
decree of any court or government instrumentality, to which the Issuer is
subject or by which it or its property is bound, which breach or default could
reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), operations or business of the Issuer or the ability
of the Issuer to perform its obligations under this Agreement, the Notes
or the Issuing and Paying Agency Agreement.

 

2.8                    There is no litigation or governmental proceeding
pending, or to the knowledge of the Issuer threatened, against or affecting the
Issuer or any of its subsidiaries which could reasonably be expected to result
in a material adverse change in the condition (financial or otherwise),
operations or business of the Issuer or the ability of the Issuer to perform its
obligations under this Agreement, the Notes or the Issuing and Paying Agency
Agreement.

 

2.9                    The Issuer is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

 

6

 

2.10              Neither the Private Placement Memorandum nor the
Company Information contains any untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided that the Issuer makes no representation or warranty as
to the Dealer Information.

 

2.11              Each (a) issuance of Notes by the Issuer
hereunder and (b) amendment or supplement of the Private Placement
Memorandum shall be deemed a representation and warranty by the Issuer to the
Dealer, as of the date thereof, that, both before and after giving effect to
such issuance and after giving effect to such amendment or supplement, (i) the
representations and warranties given by the Issuer set forth above in this Section 2
remain true and correct on and as of such date as if made on and as of such
date, (ii) in the case of an issuance of Notes, the Notes being issued on
such date have been duly and validly issued and constitute legal, valid and
binding obligations of the Issuer, enforceable against the Issuer in accordance
with their terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors’ rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law), and (iii) in the case of an issuance of
Notes, since the date of the most recent Private Placement Memorandum (as most
recently amended or supplemented, including by incorporation of Company
Information therein), there has been no material adverse change in the
condition (financial or otherwise), operations or business of the Issuer and
its subsidiaries taken as a whole which has not been disclosed to the Dealer in
writing and the Issuer is not in default of any of its obligations hereunder,
under the Notes or under the Issuing and Paying Agency Agreement.

 

2.12.                Under the laws of the Cayman Islands, neither the Issuer
nor any of its revenues, assets or properties has any right of immunity from
service of process or from the jurisdiction of competent courts of the Cayman
Islands or the United States or the State of New York in connection with any
suit, action or proceeding, attachment prior to judgment, attachment in aid of
execution of a judgment or execution of a judgment or from any other legal
process with respect to its obligations under this Agreement, the Issuing and
Paying Agency Agreement or the Notes.

 

2.13                   The Issuer is permitted to make all payments under
this Agreement, the Issuing and Paying Agency Agreement and the Notes to
holders of the Notes that are non-residents of the Cayman Islands, free and
clear of and without deduction or withholding for or on account of any taxes or
other governmental charges imposed by the Cayman Islands. There is no stamp or
documentary tax or other charge imposed by the Cayman Islands in connection
with the execution, delivery, issuance, payment, performance, enforcement or
introduction into evidence in a court of the Cayman Islands of this Agreement,
the Issuing and Paying Agency Agreement or any Note.

 

2.14                   The choice of New York law to govern this Agreement,
the Issuing and Paying Agency Agreement and the Notes is, under the laws of the
Cayman Islands, a valid, effective and irrevocable choice of law, and the
submission by the Issuer in Section 7.3 (b) of the Agreement to the
jurisdiction of the courts of the United States District Court and the State of
New York located in the Borough of Manhattan is valid and binding upon the
Issuer under the laws of the Cayman Islands.

 

7

 

2.15                   Any final judgment rendered by any court referred to
in Section 2.14 in an action to enforce the obligations of the Issuer
under this Agreement, the Issuing and Paying Agency Agreement or the Notes is
capable of being enforced in the courts of the Cayman Islands.

 

2.16               As a condition to the admissibility in evidence of
this Agreement, the Issuing and Paying Agency Agreement or the Notes in the
courts of the Cayman Islands, it is not necessary that this Agreement, the
Issuing and Paying Agency Agreement or the Notes be filed or recorded with any
court or other authority.

 

3.              Covenants and
Agreements of Issuer.

                        The Issuer covenants and agrees that:

 

3.1            The Issuer will give the Dealer prompt notice (but in
any event prior to any subsequent issuance of Notes hereunder) of any amendment
to, modification of or waiver with respect to, the Notes or the Issuing and
Paying Agency Agreement, including a complete copy of any such amendment,
modification or waiver.

 

3.2            The Issuer shall, whenever there shall occur any
material adverse change in the condition (financial or otherwise), operations
or business of the Issuer and its subsidiaries, taken as a whole, or any
adverse development or occurrence in relation to the Issuer that would be
material to holders of the Notes or potential holders of the Notes (including
any downgrading or receipt of any notice of intended or potential downgrading
or any review for potential change that does not indicate the direction of the
potential change in the rating accorded any of the Issuer’s securities by any
nationally recognized statistical rating organization which has published a
rating of the Notes), promptly, and in any event prior to any subsequent
issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in
writing) of such change, development or occurrence.

 

3.3            The Issuer shall from time to time furnish to the
Dealer such information as the Dealer may reasonably request, including,
without limitation, any press releases or material provided by the Issuer to
any national securities exchange or rating agency, regarding (i) the
Issuer’s operations and financial condition, (ii) the due authorization
and execution of the Notes and (iii) the Issuer’s ability to pay the Notes
as they mature.

 

3.4            The Issuer will take all such action as the Dealer may reasonably
request to ensure that each offer and each sale of the Notes will comply with
any applicable state Blue Sky laws; provided, however, that the Issuer shall
not be obligated to file any general consent to service of process or to
qualify as a foreign corporation in any jurisdiction in which it is not so
qualified or subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject.

 

3.5             The Issuer will not be in default of any of its
obligations hereunder, under the Notes or under the Issuing and Paying Agency
Agreement, at any time that any of the Notes are outstanding.

 

3.6            The Issuer shall not issue Notes hereunder until the
Dealer shall have received (a) an opinion of counsel to the Issuer,
addressed to the Dealer, reasonably satisfactory in form and substance to
the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement
as then in effect, (c) a copy of resolutions adopted by the Board of
Directors of the Issuer, reasonably satisfactory in form and substance to
the Dealer and certified by the Secretary or similar officer of the Issuer,
authorizing execution and delivery by the Issuer of this Agreement, the Issuing
and Paying Agency Agreement and the Notes and consummation by the Issuer of the
transactions 

 

8

 

contemplated hereby and thereby, (d) prior to the
issuance of any book-entry Notes represented by a master note registered in the
name of DTC or its nominee, a copy of the executed Letter of Representations
among the Issuer, the Issuing and Paying Agent and DTC and of the executed
master note, (e) prior to the issuance of any Notes in physical form, a
copy of such form (unless attached to this Agreement or the Issuing and
Paying Agency Agreement), (f) confirmation of the then current rating
assigned to the Notes by each nationally recognized statistical rating
organization then rating the Notes, and (g) such other certificates,
opinions, letters and documents as the Dealer shall have reasonably requested.

 

3.7             The Issuer shall reimburse the Dealer for all of the
Dealer’s reasonable out-of-pocket expenses related to this Agreement, including
expenses incurred in connection with its preparation and negotiation, and the
transactions contemplated hereby (including, but not limited to, the printing
and distribution of the Private Placement Memorandum), and, if applicable, for
the reasonable fees and out-of-pocket expenses of the Dealer’s counsel.

 

4.              Disclosure.

 

4.1             The Private Placement Memorandum and its contents
(other than the Dealer Information) shall be the sole responsibility of the
Issuer. The Private Placement Memorandum shall contain a statement expressly
offering an opportunity for each prospective purchaser to ask questions of, and
receive answers from, the Issuer concerning the offering of Notes and to obtain
relevant additional information which the
Issuer possesses or can acquire without unreasonable effort or expense.

 

4.2             The Issuer agrees to
promptly furnish the Dealer the Company Information upon or promptly following
the time it is filed with the SEC or otherwise becomes publicly available.

 

4.3             (a)  The Issuer further agrees to notify the
Dealer promptly upon the occurrence of any event relating to or affecting the
Issuer that would cause the Private Placement Memorandum to include an untrue
statement of a material fact or to omit to state a material fact necessary in
order to make the statements contained therein, in light of the circumstances
under which they are made, not misleading.

 

(b)          In the event that the Issuer
gives the Dealer notice pursuant to Section 4.3(a) and the Dealer
notifies the Issuer that it then has Notes it is holding in inventory, the
Issuer agrees promptly to supplement or amend the Private Placement Memorandum (including
through documents incorporated by reference or referred to therein) so that the
Private Placement Memorandum, as amended or supplemented, shall not contain an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements contained therein, in light of the
circumstances under which they are made, not misleading, and the Issuer shall
make such supplement or amendment available to the Dealer.

 

(c)           In the event that (i) the
Issuer gives the Dealer notice pursuant to Section 4.3(a), (ii) the
Dealer does not notify the Issuer that it is then holding Notes in inventory
and (iii) the Issuer chooses not to promptly amend or supplement the
Private Placement Memorandum in the manner described in clause (b) above,
then all solicitations and sales of Notes shall be suspended until such time as
the Issuer has so amended or supplemented the Private Placement Memorandum, and
made such amendment or supplement available to the Dealer.

 

(d)          Without limiting the
generality of Section 4.3(a), the Issuer shall review, amend and
supplement the Private Placement Memorandum (including through documents
incorporated by reference or referred to therein) on a periodic basis, but no
less than at least once annually, to 

 

9

 

incorporate
current financial information of the Issuer to the extent necessary to ensure
that the information provided in the Private Placement Memorandum is accurate
and complete.

 

5.              Indemnification
and Contribution.

 

5.1            The Issuer will indemnify and hold harmless the
Dealer, each individual, corporation, partnership, trust, association or other
entity controlling the Dealer, any affiliate of the Dealer or any such
controlling entity and their respective directors, officers, employees,
partners, incorporators, shareholders, servants, trustees and agents
(hereinafter the “Indemnitees”) against any and all liabilities, penalties,
suits, causes of action, losses, damages, claims, costs and expenses
(including, without limitation, reasonable fees and disbursements of counsel)
or judgments of whatever kind or nature (each a “Claim”), imposed upon,
incurred by or asserted against the Indemnitees (i) arising out of or
based upon any allegation that the Private Placement Memorandum, the Company
Information or any information provided by the Issuer to the Dealer included
(as of any relevant time) or includes an untrue statement of a material fact or
omitted (as of any relevant time) or omits to state any material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading or (ii) arising out of or based upon the breach
by the Issuer of any agreement, covenant or representation made in or pursuant
to this Agreement. This indemnification shall not apply if and to the extent
that the Claim arises out of or is based upon (i) Dealer Information or (ii) the
gross negligence or willful misconduct of the Dealer and, in the case of clause
(ii), the Dealer is adjudicated by a court of competent jurisdiction in a final
nonappealable judgment to have acted with gross negligence or engaged in
willful misconduct

 

5.2            Provisions relating to claims made for indemnification
under this Section 5 are set forth on Exhibit B to this Agreement.

 

5.3            In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in this
Section 5 is held to be unavailable or insufficient to hold harmless the
Indemnitees, although applicable in accordance with the terms of this Section 5,
the Issuer shall contribute to the aggregate costs incurred by the Dealer in
connection with any Claim in the proportion of the respective economic
interests of the Issuer and the Dealer; provided, however, that such
contribution by the Issuer shall be in an amount such that the aggregate costs
incurred by the Dealer do not exceed the aggregate of the commissions and fees
earned by the Dealer hereunder with respect to the issue or issues of Notes to
which such Claim relates. The respective economic interests shall be calculated
by reference to the aggregate proceeds to the Issuer of the Notes issued
hereunder and the aggregate commissions and fees earned by the Dealer
hereunder.

 

6.              Definitions.

 

6.1              “Claim” shall have the meaning set forth in Section 5.1.

 

6.2              “Company Information” at any given time shall mean the
Private Placement Memorandum together with, to the extent applicable, (i) the
Issuer’s most recent report on Form 10-K filed with the SEC and each
report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most
recent Form 10-K, (ii) the Issuer’s most recent annual audited
financial statements and each interim financial statement or report prepared
subsequent thereto, if not included in item (i) above, (iii) the
Issuer’s and its affiliates’ other publicly available recent reports,
including, but not limited to, any publicly available filings or reports
provided to their respective shareholders, (iv) any other information or
disclosure prepared pursuant to Section 4.3 hereof and (v) any 

 

10

 

information prepared or approved by the Issuer for
dissemination to investors or potential investors in the Notes.

 

6.3              “Dealer Information” shall mean material concerning
the Dealer provided by the Dealer in writing expressly for inclusion in the
Private Placement Memorandum.

 

6.4              “Exchange Act” shall mean the U.S. Securities Exchange
Act of 1934, as amended.

 

6.5              “Indemnitee” shall have the meaning set forth in Section 5.1.

 

6.6              “Institutional Accredited Investor” shall mean an
institutional investor that is an accredited investor within the meaning of Rule 501
under the Securities Act and that has such knowledge and experience in
financial and business matters that it is capable of evaluating and bearing the
economic risk of an investment in the Notes, including, but not limited to, a
bank, as defined in Section 3(a)(2) of the Securities Act, or a
savings and loan association or other institution, as defined in Section 3(a)(5)(A) of
the Securities Act, whether acting in its individual or fiduciary capacity.

 

6.7               “Issuing and Paying Agency Agreement” shall mean the
issuing and paying agency agreement described on the cover page of this
Agreement, as such agreement may be amended or supplemented from time to
time.

 

6.8              “Issuing and Paying Agent” shall mean the party
designated as such on the cover page of this Agreement, as issuing and
paying agent under the Issuing and Paying Agency Agreement, or any successor
thereto in accordance with the Issuing and Paying Agency Agreement.

 

6.9              “Non-bank fiduciary or agent” shall mean a fiduciary
or agent other than (a) a bank, as defined in Section 3(a)(2) of
the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of
the Securities Act.

 

6.10        “Private Placement Memorandum” shall mean offering
materials prepared in accordance with Section 4 (including materials
referred to therein or incorporated by reference therein, if any) provided to
purchasers and prospective purchasers of the Notes, and shall include amendments
and supplements thereto which may be prepared from time to time in
accordance with this Agreement (other than any amendment or supplement that has
been completely superseded by a later amendment or supplement).

 

6.11               “Qualified Institutional Buyer” shall have the meaning
assigned to that term in Rule 144A under the Securities Act.

 

6.12               “Rule 144A” shall mean Rule 144A under the
Securities Act.

 

6.13               “SEC” shall mean the U.S. Securities and Exchange
Commission.

 

6.14               “Securities Act” shall mean the U.S. Securities Act of
1933, as amended.

 

6.15               “Sophisticated Individual Accredited Investor” shall
mean an individual who (a) is an accredited investor within the meaning of
Regulation D under the Securities Act and (b) based on his or her
pre-existing relationship with the Dealer, is reasonably believed by the Dealer
to be a sophisticated investor (i) possessing such knowledge and
experience (or represented by a fiduciary or agent possessing such knowledge
and experience) in financial and business matters that he or she is capable of
evaluating and bearing the economic risk of an investment in the 

 

11

 

Notes and (ii) having not less than $5 million in
investments (as defined, for purposes of this section, in Rule 2a51-1
under the Investment Company Act of 1940, as amended).

 

6.16               “Regulation D” shall mean Regulation D (Rules 501
et seq.) under the Securities Act.

 

7.              General

 

7.1               Unless otherwise expressly provided herein, all
notices under this Agreement to parties hereto shall be in writing and shall be
effective when received at the address of the respective party set forth in the
Addendum to this Agreement.

 

7.2               This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
conflict of laws provisions.

 

7.3               (a)                      The Issuer agrees that any suit, action
or proceeding brought by the Issuer against the Dealer in connection with or
arising out of this Agreement or the Notes or the offer and sale of the Notes
shall be brought solely in the United States federal courts located in the
Borough of Manhattan or the courts of the State of New York located in the
Borough of Manhattan. EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO
TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(b)                     The Issuer hereby irrevocably accepts and
submits to the non-exclusive jurisdiction of each of the aforesaid courts in
personam, generally and unconditionally, for itself and in respect of its
properties, assets and revenues, with respect to any suit, action or proceeding
in connection with or arising out of this Agreement or the Notes or the offer
and sale of the Notes.

 

(c)                      The Issuer hereby irrevocably designates,
appoints and empowers Transocean Offshore Deepwater Drilling Inc., with offices
at 4 Greenway Plaza, Houston, Texas, 77046, as its designee, appointee and
agent to receive, accept and acknowledge for and on its behalf, and its
properties, assets and revenues, service for any and all legal process,
summons, notices and documents which may be served in any such action,
suit or proceeding brought in the courts listed in Section 7.3(a) which
may be made on such designee, appointee and agent in accordance with legal
procedures prescribed for such courts, with respect to any suit, action or
proceeding in connection with or arising out of this Agreement or the Notes or
the offer and sale of the Notes. If for any reason such designee, appointee and
agent hereunder shall cease to be available to act as such, the Issuer agrees
to designate a new designee, appointee and agent in The City of New York on the
terms and for the purposes of this Section 7.3 satisfactory to the Dealer.
The Issuer further hereby irrevocably consents and agrees to the service of any
and all legal process, summons, notices and documents out of any of the
aforesaid courts in any such action, suit or proceeding by serving a copy
thereof upon the agent for service of process referred to in this Section 7.3
(whether or not the appointment of such agent shall for any reason prove to be
ineffective or such agent shall accept or acknowledge such service) or by
mailing copies thereof by registered or certified airmail, postage prepaid, to
it at its address specified in or designated pursuant to this Agreement. The
Issuer agrees that the failure of any such designee, appointee and agent to
give any notice of such service to it shall not impair or affect in any way the
validity of such service or any judgment rendered in any action or proceeding
based thereon. Nothing herein shall in any way be deemed to limit the ability
of the holders of any Notes or the Dealer to serve any such legal process,
summons, notices and documents in any other manner permitted by applicable law
or to obtain jurisdiction over the undersigned or bring actions, suits or
proceedings against the undersigned in such other

 

12

 

jurisdictions, and in manner, as may be permitted
by applicable law. The Issuer hereby irrevocably and unconditionally waives any
objection which it may now or hereafter have to the laying of venue of any
of the aforesaid actions, suits or proceedings arising out of or in connection
with this Agreement brought in the courts listed in Section 7.3(a) and
hereby further irrevocably and unconditionally waives and agrees not to plead
or claim in any such court that any such action, suit or proceeding brought in
any such court has been brought in an inconvenient forum.

 

(d)                     To the extent that the Issuer or any of
its properties, assets or revenues may have or may hereafter become
entitled to, or have attributed to it, any right of immunity, on the grounds of
sovereignty or otherwise, from any legal action, suit or proceeding in
connection with or arising out of this Agreement or the Notes or the offer and
sale of the Notes, from the giving of any relief in any thereof, from setoff or
counterclaim, from the jurisdiction of any court, from service of process, from
attachment upon or prior to judgment, from attachment in aid of execution of
judgment, or from execution of judgment, or other legal process or proceeding
for the giving of any relief or for the enforcement of any judgment, in any
jurisdiction in which proceeding may at any time be commenced, with
respect to its obligations, liabilities or any other matter under or arising
out of or in connection with this Agreement, the Issuing and Paying Agency
Agreement or the Notes, the Issuer hereby irrevocably and unconditionally
waives, and agrees for the benefit of the Dealer and any holder from time to
time of the Notes not to plead or claim, any such immunity, and consents to
such relief and enforcement.

 

7.4              This Agreement may be terminated, at any time, by
the Issuer, upon one business day’s prior notice to such effect to the Dealer,
or by the Dealer upon three business days’ prior notice to such effect to the
Issuer. Any such termination, however, shall not affect the obligations of the
Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations,
warranties, agreements, covenants, rights or responsibilities of the parties
made or arising prior to the termination of this Agreement.

 

7.5              This Agreement is not assignable by either party
hereto without the written consent of the other party; provided, however, that
the Dealer may assign its rights and obligations under this Agreement to
any affiliate of the Dealer.

 

7.6              This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.

 

7.7              This Agreement is for the exclusive benefit of the
parties hereto, and their respective permitted successors and assigns
hereunder, and shall not be deemed to give any legal or equitable right, remedy
or claim to any other person whatsoever ; provided, however,
that Sections 7.3(b), (c) and (d) and Section 7.8 are hereby
specifically and exclusively acknowledged to also be for the benefit of the holders
from time to time of the Notes, as third-party beneficiaries.

 

7.8               (a)                      Any payments to the Dealer hereunder or
to any holder from time to time of Notes shall be in United States dollars and
shall be free of all withholding and other taxes, and of all other governmental
charges of any nature whatsoever, in each case which are imposed by the
jurisdiction in which the Issuer is incorporated other than taxes or
governmental charges based on or measured by net income or receipts and any
other taxes or governmental charges which are imposed because of a connection
between the Dealer or holder with such jurisdiction other than the purchase,
ownership or disposition of Notes. In the event any such withholding is 

 

13

 

required by law, the Issuer agrees to (i) pay the
same and (ii) pay such additional amounts to the Dealer or any such holder
which, after deduction of any such withholding or other taxes or governmental
charges of any nature whatsoever imposed with respect to the payment of such
additional amount, shall equal the amount withheld pursuant to clause (i). The
Issuer will promptly pay any stamp duty or other taxes or governmental charges
payable in connection with the execution, delivery, payment or performance of
this Agreement, the Issuing and Paying Agency Agreement or the Notes and shall
indemnify and hold harmless the Dealer and each holder of Notes from all
liabilities arising from any failure to pay, or delay in paying, such taxes or
charges.

 

(b)                     The Issuer agrees to indemnify and hold
harmless the Dealer and each holder from time to time of Notes against any loss
incurred by the Dealer or such holder as a result of any judgment or order
being given or made for any amount due hereunder and such judgment or order
being expressed and paid in a currency (the “Judgment Currency”) other than
United States dollars and as a result of any variation as between (i) the
rate of exchange at which the United States dollar amount is converted into the
Judgment Currency for the purpose of such judgment or order, and (ii) the
rate of exchange at which the Dealer or such holder is able to purchase United
States dollars with the amount of Judgment Currency actually received by the
Dealer or such holder. The foregoing indemnity shall constitute a separate and
independent obligation of the Issuer and shall continue in full force and
effect notwithstanding any such judgment or order as aforesaid. The term “rate
of exchange” shall include any premiums and costs of exchange payable in
connection with the purchase of, or conversion into, the relevant currency.

 

7.9              The Issuer acknowledges and
agrees that in connection with this purchase and sale of the Notes or any other
services the Dealer may be deemed to be providing hereunder,
notwithstanding any preexisting relationship, advisory or otherwise, between
the parties or any oral representations or assurances previously or
subsequently made by the Dealer: (i) no fiduciary or agency relationship
between the Issuer and any other person, on the one hand, and the Dealer, on
the other, exists; (ii) the Dealer is not acting as advisor, expert or
otherwise, to the Issuer, including, without limitation, with respect to the
determination of the offering price of the Notes, and such relationship between
the Issuer, on the one hand, and the Dealer, on the other, is entirely and
solely commercial, based on arms-length negotiations; (iii) any duties and
obligations that the Dealer may have to the Issuer shall be limited to
those duties and obligations specifically stated herein; and (iv) the
Dealer and their respective affiliates may have interests that differ from
those of the Issuer. The Issuer hereby waives any claims that the Issuer may have
against the Dealer with respect to any breach of fiduciary duty in connection
with the purchase and sale of the Notes.

 

14

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed as of the date and year first above written.

 

	
  Transocean
  Inc.,  as  Issuer

  	
  Lehman Brothers Inc.,  as Dealer

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
    /s/ Steve
  McFadin

  	
   

  	
  By: 

  	
    /s/ Joann
  Petrossian

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
    Steve McFadin

  	
   

  	
  Name:

  	
  Joann Petrossian

  
	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  Assistant Treasurer

  	
   

  	
  Title: 

  	
  Senior Vice President

  
									

 

15

 

Addendum

 

The following additional clauses shall apply to the
Agreement and be deemed a part thereof.

 

1.               The other dealers referred to in clause (b) of Section 1.2
of the Agreement are J.P. Morgan Securities Inc. and Morgan Stanley &
Co. Incorporated.

 

2.               The addresses of the respective parties for purposes
of notices under Section 7.1 are as follows:

 

For the Issuer:

 

Address: P.O. Box 10342; West Wind; 70 Harbour Drive, 4th Floor,
Block B; George Town, Grand Cayman KY1-1003; Cayman Islands, B.W.I.

 

Attention: Steve McFadin

 

Telephone number: 345-745-4500

 

Fax number: 345-745-4504

 

With Copy to:

 

Address: 4 Greenway Plaza, Houston, Texas 77046

 

Attention: Treasurer

 

Telephone number: 713-232-7173

 

Fax number: 713-626-9556

 

For the Dealer:

 

Address: 745 Seventh Avenue, 4th floor, New York, New York 10019-6801

 

Attention: Product Management-Commercial Paper

 

Telephone number: 212-526-0731

 

Fax number: 646-758-4641

 

16

 

Exhibit A

 

Form of Legend for
Private Placement Memorandum and Notes

 

THE NOTES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE
SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN
COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE,
THE PURCHASER WILL BE DEEMED TO REPRESENT THAT (I) IT HAS BEEN AFFORDED AN
OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, (II) IT
IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND (III) IT
IS EITHER (A)(1) AN INSTITUTIONAL INVESTOR OR SOPHISTICATED INDIVIDUAL
INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER
THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH
KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS
CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE
NOTES AND (ii) HAS NOT LESS THAN $5 MILLION IN INVESTMENTS (AN “INSTITUTIONAL
ACCREDITED INVESTOR” OR “SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR”,
RESPECTIVELY) AND (2)(i) PURCHASING NOTES FOR ITS OWN ACCOUNT, (ii) A
BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN
ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF
THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR (iii) A
FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN ASSOCIATION) PURCHASING
NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH ACCOUNTS IS SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR; OR (B) A
QUALIFIED INSTITUTIONAL BUYER (“QIB”) WITHIN THE MEANING OF RULE 144A
UNDER THE ACT THAT IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE
ACCOUNTS, EACH OF WHICH ACCOUNTS IS A QIB AND WITH RESPECT TO EACH OF WHICH
ACCOUNTS THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER
ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION
FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A.
BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO
AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE
ISSUER OR TO A PLACEMENT AGENT DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT
FOR THE NOTES, NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH
A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR, SOPHISTICATED
INDIVIDUAL ACCREDITED INVESTOR OR A QIB, OR (3) TO A QIB IN A TRANSACTION
THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS
OF $250,000.

 

17

 

Exhibit B

 

Further Provisions Relating
to Indemnification

 

(a)          The Issuer agrees to reimburse each
Indemnitee for all expenses (including reasonable fees and disbursements of
internal and external counsel) as they are incurred by it in connection with investigating
or defending any loss, claim, damage, liability or action in respect of which
indemnification may be sought under Section 5 of the Agreement
(whether or not it is a party to any such proceedings).

 

(b)         Promptly after receipt by an Indemnitee
of notice of the existence of a Claim, such Indemnitee will, if a claim in
respect thereof is to be made against the Issuer, notify the Issuer in writing
of the existence thereof; provided that (i) the omission so to notify the
Issuer will not relieve the Issuer from any liability which it may have
hereunder unless and except to the extent it did not otherwise learn of such
Claim and such failure results in the forfeiture by the Issuer of substantial
rights and defenses and (ii) the omission so to notify the Issuer will not
relieve it from liability which it may have to an Indemnitee otherwise
than on account of this indemnity agreement. In case any such Claim is made
against any Indemnitee and it notifies the Issuer of the existence thereof, the
Issuer will be entitled to participate therein, and to the extent that it may elect
by written notice delivered to the Indemnitee, to assume and direct the defense
thereof, with counsel reasonably satisfactory to such Indemnitee; provided that
if the defendants in any such Claim include both the Indemnitee and the Issuer,
and the Indemnitee shall have concluded that there may be legal defenses
available to it which are different from or additional to those available to
the Issuer, the Issuer shall not have the right to direct the defense of such
Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to
select separate counsel to assert such legal defenses on behalf of such
Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer’s
election so to assume the defense of such Claim and approval by the Indemnitee
of counsel, the Issuer will not be liable to such Indemnitee for expenses
incurred thereafter by the Indemnitee in connection with the defense thereof
(other than reasonable costs of investigation) unless (i) the Indemnitee
shall have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the next preceding sentence (it
being understood, however, that the Issuer shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel in the
jurisdiction in which any Claim is brought), approved by the Dealer,
representing the Indemnitee who is party to such Claim), (ii) the Issuer
shall not have employed counsel reasonably satisfactory to the Indemnitee to
represent the Indemnitee within a reasonable time after notice of existence of
the Claim or (iii) the Issuer has authorized in writing the employment of
counsel for the Indemnitee. The indemnity, reimbursement and contribution
obligations of the Issuer hereunder shall be in addition to any other liability
the Issuer may otherwise have to an Indemnitee and shall be binding upon
and inure to the benefit of any successors, assigns, heirs and personal
representatives of the Issuer and any Indemnitee. The Issuer agrees that
without the Dealer’s prior written consent, which consent shall not be
unreasonably delayed or withheld, it will not settle, compromise or consent to
the entry of any judgment in any Claim in respect of which indemnification may be
sought under the indemnification provision of the Agreement (whether or not the
Dealer or any other Indemnitee is an actual or potential party to such Claim),
unless such settlement, compromise or consent includes an unconditional release
of each Indemnitee from all liability arising out of such Claim. The Issuer
shall not be liable hereunder to any Indemnitee regarding any settlement,
compromise or entry of judgment with respect to any Claim unless such
settlement, compromise or entry of judgment is consented to by the Issuer,
which consent shall not be unreasonably withheld or delayed.

 

18

 

Exhibit C

 

Statement of Terms for
Interest – Bearing Commercial Paper Notes of Transocean Inc.

 

THE
PROVISIONS SET FORTH BELOW ARE QUALIFIED TO THE EXTENT APPLICABLE BY THE
TRANSACTION SPECIFIC [PRICING] [PRIVATE PLACEMENT MEMORANDUM] SUPPLEMENT (THE “SUPPLEMENT”)
(IF ANY) SENT TO EACH PURCHASER AT THE TIME OF THE TRANSACTION.

 

1.   General. (a)  The obligations of the Issuer to which
these terms apply (each a “Note”) are represented by one or more Master Notes
(each, a “Master Note”) issued in the name of (or of a nominee for) The
Depository Trust Company (“DTC”), which Master Note includes the terms and
provisions for the Issuer’s Interest-Bearing Commercial Paper Notes that are
set forth in this Statement of Terms, since this Statement of Terms constitutes
an integral part of the Underlying Records as defined and referred to in
the Master Note.

 

(b)  “Business Day” means any day other than a
Saturday or Sunday that is neither a legal holiday nor a day on which banking
institutions are authorized or required by law, executive order or regulation
to be closed in New York City and, with respect to LIBOR Notes (as defined
below) is also a London Business Day. “London Business Day” means, a day, other
than a Saturday or Sunday, on which dealings in deposits in U.S. dollars are
transacted in the London interbank market.

 

2.   Interest. (a)  Each Note will bear interest at a fixed
rate (a “Fixed Rate Note”) or at a floating rate (a “Floating Rate Note”).

 

(b)  The Supplement sent to each holder of such
Note will describe the following terms: (i) whether such Note is a Fixed
Rate Note or a Floating Rate Note and whether such Note is an Original Issue
Discount Note (as defined below); (ii) the date on which such Note will be
issued (the “Issue Date”); (iii) the Stated Maturity Date (as defined
below); (iv) if such Note is a Fixed Rate Note, the rate per annum at
which such Note will bear interest, if any, and the Interest Payment Dates; (v) if
such Note is a Floating Rate Note, the Base Rate, the Index Maturity, the
Interest Reset Dates, the Interest Payment Dates and the Spread and/or Spread
Multiplier, if any (all as defined below), and any other terms relating to the
particular method of calculating the interest rate for such Note; and (vi) any
other terms applicable specifically to such Note. “Original Issue Discount Note”
means a Note which has a stated redemption price at the Stated Maturity Date
that exceeds its Issue Price by more than a specified de minimis amount and
which the Supplement indicates will be an “Original Issue Discount Note”.

 

(c)  Each Fixed Rate Note will bear interest from
its Issue Date at the rate per annum specified in the Supplement until the
principal amount thereof is paid or made available for payment. Interest on
each Fixed Rate Note will be payable on the dates specified in the Supplement
(each an “Interest Payment Date” for a Fixed Rate Note) and on the Maturity
Date (as defined below). Interest on Fixed Rate Notes will be computed on the
basis of a 360-day year of twelve 30-day months.

 

If any Interest Payment Date or the Maturity Date of a
Fixed Rate Note falls on a day that is not a Business Day, the required payment
of principal, premium, if any, and/or interest will be payable on the next
succeeding Business Day, and no additional interest will accrue in respect of
the payment made on that next succeeding Business Day.

 

(d)  The interest rate on each Floating Rate Note
for each Interest Reset Period (as defined below) will be determined by
reference to an interest rate basis (a “Base Rate”) plus or minus a number of
basis points 

 

19

 

(one basis point equals one-hundredth of a percentage
point) (the “Spread”), if any, and/or multiplied by a certain percentage (the “Spread
Multiplier”), if any, until the principal thereof is paid or made available for
payment. The Supplement will designate which of the following Base Rates is
applicable to the related Floating Rate Note: (a) the CD Rate (a “CD Rate
Note”), (b) the Commercial Paper Rate (a “Commercial Paper Rate Note”), (c) the
Federal Funds Rate (a “Federal Funds Rate Note”), (d) LIBOR (a “LIBOR Note”),
(e) the Prime Rate (a “Prime Rate Note”), (f) the Treasury Rate (a “Treasury
Rate Note”) or (g) such other Base Rate as may be specified in such
Supplement.

 

The rate of interest on each Floating Rate Note will
be reset daily, weekly, monthly, quarterly or semi-annually (the “Interest
Reset Period”). The date or dates on which interest will be reset (each an “Interest
Reset Date”) will be, unless otherwise specified in the Supplement, in the case
of Floating Rate Notes which reset daily, each Business Day, in the case of
Floating Rate Notes (other than Treasury Rate Notes) that reset weekly, the
Wednesday of each week; in the case of Treasury Rate Notes that reset weekly,
the Tuesday of each week; in the case of Floating Rate Notes that reset
monthly, the third Wednesday of each month; in the case of Floating Rate Notes
that reset quarterly, the third Wednesday of March, June, September and
December; and in the case of Floating Rate Notes that reset semiannually, the
third Wednesday of the two months specified in the Supplement. If any Interest
Reset Date for any Floating Rate Note is not a Business Day, such Interest
Reset Date will be postponed to the next day that is a Business Day, except
that in the case of a LIBOR Note, if such Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the immediately
preceding Business Day. Interest on each Floating Rate Note will be payable
monthly, quarterly or semiannually (the “Interest Payment Period”) and on the
Maturity Date. Unless otherwise specified in the Supplement, and except as
provided below, the date or dates on which interest will be payable (each an “Interest
Payment Date” for a Floating Rate Note) will be, in the case of Floating Rate
Notes with a monthly Interest Payment Period, on the third Wednesday of each
month; in the case of Floating Rate Notes with a quarterly Interest Payment
Period, on the third Wednesday of March, June, September and December; and
in the case of Floating Rate Notes with a semiannual Interest Payment Period,
on the third Wednesday of the two months specified in the Supplement. In
addition, the Maturity Date will also be an Interest Payment Date.

 

If any Interest Payment Date for any Floating Rate Note
(other than an Interest Payment Date occurring on the Maturity Date) would
otherwise be a day that is not a Business Day, such Interest Payment Date shall
be postponed to the next day that is a Business Day, except that in the case of
a LIBOR Note, if such Business Day is in the next succeeding calendar month,
such Interest Payment Date shall be the immediately preceding Business Day. If
the Maturity Date of a Floating Rate Note falls on a day that is not a Business
Day, the payment of principal and interest will be made on the next succeeding
Business Day, and no interest on such payment shall accrue for the period from
and after such maturity.

 

Interest payments on each Interest Payment Date for
Floating Rate Notes will include accrued interest from and including the Issue
Date or from and including the last date in respect of which interest has been
paid, as the case may be, to, but excluding, such Interest Payment Date. On
the Maturity Date, the interest payable on a Floating Rate Note will include interest
accrued to, but excluding, the Maturity Date. Accrued interest will be
calculated by multiplying the principal amount of a Floating Rate Note by an
accrued interest factor. This accrued interest factor will be computed by
adding the interest factors calculated for each day in the period for which
accrued interest is being calculated. The interest factor (expressed as a
decimal) for each such day will be computed by dividing the interest rate
applicable to such day by 360, in the cases where the Base Rate is the CD Rate,
Commercial Paper Rate, Federal Funds Rate, LIBOR or Prime Rate, or by the
actual number of days in the year, in the case where the Base Rate is the
Treasury Rate. The interest rate in effect on each day will be (i) if such
day is an Interest Reset Date, the interest rate with respect to the Interest
Determination Date (as defined below) pertaining to 

 

20

 

such Interest Reset Date, or (ii) if such day is
not an Interest Reset Date, the interest rate with respect to the Interest
Determination Date pertaining to the next preceding Interest Reset Date,
subject in either case to any adjustment by a Spread and/or a Spread
Multiplier.

 

The “Interest Determination Date” where the Base Rate
is the CD Rate or the Commercial Paper Rate will be the second Business Day
next preceding an Interest Reset Date. The Interest Determination Date where
the Base Rate is the Federal Funds Rate or the Prime Rate will be the Business
Day next preceding an Interest Reset Date. The Interest Determination Date
where the Base Rate is LIBOR will be the second London Business Day next
preceding an Interest Reset Date. The Interest Determination Date where the
Base Rate is the Treasury Rate will be the day of the week in which such
Interest Reset Date falls when Treasury Bills are normally auctioned. Treasury
Bills are normally sold at auction on Monday of each week, unless that day is a
legal holiday, in which case the auction is held on the following Tuesday or
the preceding Friday. If an auction is so held on the preceding Friday, such
Friday will be the Interest Determination Date pertaining to the Interest Reset
Date occurring in the next succeeding week.

 

The “Index Maturity” is the period to maturity of the
instrument or obligation from which the applicable Base Rate is calculated.

 

The “Calculation Date,” where applicable, shall be the
earlier of (i) the tenth calendar day following the applicable Interest
Determination Date or (ii) the Business Day preceding the applicable
Interest Payment Date or Maturity Date.

 

All times referred to herein reflect New York City
time, unless otherwise specified.

 

The Issuer shall specify in writing to the Issuing and
Paying Agent which party will be the calculation agent (the “Calculation Agent”)
with respect to the Floating Rate Notes. The Calculation Agent will provide the
interest rate then in effect and, if determined, the interest rate which will
become effective on the next Interest Reset Date with respect to such Floating
Rate Note to the Issuing and Paying Agent as soon as the interest rate with
respect to such Floating Rate Note has been determined and as soon as
practicable after any change in such interest rate.

 

All percentages resulting from any calculation on
Floating Rate Notes will be rounded to the nearest one hundred-thousandth of a
percentage point, with five-one millionths of a percentage point rounded
upwards. For example, 9.876545% (or .09876545) would be rounded to 9.87655% (or
..0987655). All dollar amounts used in or resulting from any calculation on
Floating Rate Notes will be rounded, in the case of U.S. dollars, to the
nearest cent or, in the case of a foreign currency, to the nearest unit (with
one-half cent or unit being rounded upwards).

 

CD Rate Notes

 

“CD Rate” means the rate on any Interest Determination Date for
negotiable certificates of deposit having the Index Maturity as published by
the Board of Governors of the Federal Reserve System (the “FRB”) in “Statistical
Release H.15(519), Selected Interest Rates” or any successor publication of the
FRB (“H.15(519)”) under the heading “CDs (Secondary Market)”.

 

If the above rate is not published in H.15(519) by 3:00 p.m. on
the Calculation Date, the CD Rate will be the rate on such Interest
Determination Date set forth in the daily update of H.15(519), available
through the world wide website of the FRB at
http://www.federalreserve.gov/releases/h15/Update, or any successor site or
publication or other recognized electronic source used for the purpose of displaying
the applicable rate (“H.15 Daily Update”) under the caption “CDs (Secondary
Market)”.

 

21

 

If such rate is not published in either H.15(519) or H.15 Daily Update
by 3:00 p.m. on the Calculation Date, the Calculation Agent will determine
the CD Rate to be the arithmetic mean of the secondary market offered rates as
of 10:00 a.m. on such Interest Determination Date of three leading nonbank
dealers(1)  in negotiable U.S. dollar certificates of deposit in New York
City selected by the Calculation Agent for negotiable U.S. dollar certificates
of deposit of major United States money center banks of the highest credit
standing in the market for negotiable certificates of deposit with a remaining
maturity closest to the Index Maturity in the denomination of $5,000,000.

 

If the dealers selected by the Calculation Agent are not quoting as set
forth above, the CD Rate will remain the CD Rate then in effect on such
Interest Determination Date.

 

Commercial Paper Rate Notes

 

“Commercial Paper Rate” means the Money Market Yield (calculated as
described below) of the rate on any Interest Determination Date for commercial
paper having the Index Maturity, as published in H.15(519) under the heading “Commercial
Paper-Nonfinancial”.

 

If the above rate is not published in H.15(519) by 3:00 p.m. on
the Calculation Date, then the Commercial Paper Rate will be the Money Market
Yield of the rate on such Interest Determination Date for commercial paper of
the Index Maturity as published in H.15 Daily Update under the heading “Commercial
Paper-Nonfinancial”.

 

If by 3:00 p.m. on such Calculation Date such rate is not
published in either H.15(519) or H.15 Daily Update, then the Calculation Agent
will determine the Commercial Paper Rate to be the Money Market Yield of the
arithmetic mean of the offered rates as of 11:00 a.m. on such Interest
Determination Date of three leading dealers of U.S. dollar commercial paper in
New York City selected by the Calculation Agent for commercial paper of the
Index Maturity placed for an industrial issuer whose bond rating is “AA,” or
the equivalent, from a nationally recognized statistical rating organization.

 

If the dealers selected by the Calculation Agent are not quoting as
mentioned above, the Commercial Paper Rate with respect to such Interest
Determination Date will remain the Commercial Paper Rate then in effect on such
Interest Determination Date.

 

“Money Market Yield” will be a yield calculated in accordance with the
following formula:

 

	
  Money Market Yield = 

  	
  D x 360

  	
   x 100 

  
	
  360 - (D x M)

  

 

where “D” refers to the applicable per annum rate for commercial paper
quoted on a bank discount basis and expressed as a decimal and “M” refers to
the actual number of days in the interest period for which interest is being
calculated.

 

Federal Funds Rate Notes

 

“Federal
Funds Rate” means the rate on any Interest Determination Date for Federal Funds
as published in Reuters (or any successor service) on page FEDFUNDS1 under
the heading “EFFECT” (or any other page as may replace the specified page on
that service) (“Reuters Page FEDFUNDS1”).

 

(1)   Such nonbank dealers referred to in this
Statement of Terms may include affiliates of the Dealer.

 

22

 

If
the above rate does not appear on Reuters Page FEDFUNDS1 or is not so
published by 3:00 p.m. on the Calculation Date, the Federal Funds Rate
will be the rate on such Interest Determination Date as published in H.15 Daily
Update under the heading “Federal Funds/(Effective)”.

 

If such rate is not published as described above by 3:00 p.m. on
the Calculation Date, the Calculation Agent will determine the Federal Funds
Rate to be the arithmetic mean of the rates for the last transaction in
overnight U.S. dollar federal funds arranged by each of three leading brokers
of Federal Funds transactions in New York City selected by the Calculation
Agent prior to 9:00 a.m. on such Interest Determination Date.

 

If the brokers selected by the Calculation Agent are not quoting as
mentioned above, the Federal Funds Rate will remain the Federal Funds Rate then
in effect on such Interest Determination Date.

 

LIBOR Notes

 

The London Interbank offered rate (“LIBOR”) means, with respect to any
Interest Determination Date, the rate for deposits in U.S. dollars having the
Index Maturity that appears on the Designated LIBOR Page as of 11:00 a.m.,
London time, on such Interest Determination Date.

 

If no rate appears, LIBOR will be determined on the basis of the rates
at approximately 11:00 a.m., London time, on such Interest Determination
Date at which deposits in U.S. dollars are offered to prime banks in the London
interbank market by four major banks in such market selected by the Calculation
Agent for a term equal to the Index Maturity and in principal amount equal to
an amount that in the Calculation Agent’s judgment is representative for a
single transaction in U.S. dollars in such market at such time (a “Representative
Amount”). The Calculation Agent will request the principal London office of
each of such banks to provide a quotation of its rate. If at least two such
quotations are provided, LIBOR will be the arithmetic mean of such quotations. If
fewer than two quotations are provided, LIBOR for such interest period will be
the arithmetic mean of the rates quoted at approximately 11:00 a.m., in
New York City, on such Interest Determination Date by three major banks in New
York City, selected by the Calculation Agent, for loans in U.S. dollars to
leading European banks, for a term equal to the Index Maturity and in a
Representative Amount; provided, however, that if fewer than three banks so
selected by the Calculation Agent are providing such quotations, the then
existing LIBOR rate will remain in effect for such Interest Payment Period.

 

“Designated
LIBOR Page” means Reuters Screen LIBOR01 Page or any replacement page or
pages on which London interbank rates of major banks for the Index
Currency are displayed.

 

Prime Rate Notes

 

“Prime Rate” means the rate on any Interest Determination Date as
published in H.15(519) under the heading “Bank Prime Loan”.

 

If the above rate is not published in H.15(519) prior to 3:00 p.m.
on the Calculation Date, then the Prime Rate will be the rate on such Interest
Determination Date as published in H.15 Daily Update opposite the caption “Bank
Prime Loan”.

 

If the rate is not published prior to 3:00 p.m. on the Calculation
Date in either H.15(519) or H.15 Daily Update, then the Calculation Agent will
determine the Prime Rate to be the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen US PRIME1 Page (as
defined below) as such bank’s prime rate or base lending rate as of 11:00 a.m.,
on that Interest Determination Date.

 

23

 

If fewer than four such rates referred to above are so published by
3:00 p.m. on the Calculation Date, the Calculation Agent will determine
the Prime Rate to be the arithmetic mean of the prime rates or base lending rates
quoted on the basis of the actual number of days in the year divided by 360 as
of the close of business on such Interest Determination Date by three major
banks in New York City selected by the Calculation Agent.

 

If the banks selected are not quoting as mentioned above, the Prime
Rate will remain the Prime Rate in effect on such Interest Determination Date.

 

“Reuters
Screen US Prime1 Page” means the display designated as page ”USPrime1” of
the Reuters Service, or any successor service, or any replacement page or pages on
that service, for the purpose of displaying prime rates or base lending rates
of major U.S. banks.

 

Treasury Rate Notes

 

“Treasury Rate” means:

 

(1) the
rate from the auction held on the Interest Determination Date (the “Auction”)
of direct obligations of the United States (“Treasury Bills”) having the Index
Maturity specified in the applicable pricing supplement above under the caption
“INVESTMENT RATE”, as that rate appears on Reuters Screen USAUCTION10 or
USAUCTION11 Page under the heading “Investment Rate” (or any other page as
may replace the specified page on that service or a successor
service).

 

 (2) if the rate referred to
in clause (1) is not so published by 3:00 p.m. on the related
Calculation Date, the Bond Equivalent Yield (as defined below) of the rate for
the applicable Treasury Bills as published in H.15 Daily Update, under the
caption “U.S. Government Securities/Treasury Bills/Auction High”, or

 

(3) if the rate referred to in clause (2) is not so published
by 3:00 p.m. on the related Calculation Date, the Bond Equivalent Yield of
the auction rate of the applicable Treasury Bills as announced by the United
States Department of the Treasury, or

 

(4) if the rate referred to in clause (3) is not so announced
by the United States Department of the Treasury, or if the Auction is not held,
the Bond Equivalent Yield of the rate on the particular Interest Determination
Date of the applicable Treasury Bills as published in H.15(519) under the
caption “U.S. Government Securities/Treasury Bills/Secondary Market”, or

 

(5) if the rate referred to in clause (4) not so published by
3:00 p.m. on the related Calculation Date, the rate on the particular
Interest Determination Date of the applicable Treasury Bills as published in
H.15 Daily Update, under the caption “U.S. Government Securities/Treasury
Bills/Secondary Market”, or

 

(6) if the rate referred to in clause (5) is not so published
by 3:00 p.m. on the related Calculation Date, the rate on the particular
Interest Determination Date calculated by the Calculation Agent as the Bond
Equivalent Yield of the arithmetic mean of the secondary market bid rates, as
of approximately 3:30 p.m. on that Interest Determination Date, of three
primary United States government securities dealers selected by the Calculation
Agent, for the issue of Treasury Bills with a remaining maturity closest to the
Index Maturity specified in the Supplement, or

 

(7) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (6), the Treasury Rate
in effect on the particular Interest Determination Date.

 

24

 

“Bond Equivalent Yield”
means a yield (expressed as a percentage) calculated in accordance with the
following formula:

 

	
  Bond Equivalent Yield = 

  	
  D x N

  	
      x 100 

  
	
  360 - (D x M)

  

 

where “D” refers to the applicable per annum rate for Treasury Bills
quoted on a bank discount basis and expressed as a decimal, “N” refers to 365
or 366, as the case may be, and “M” refers to the actual number of days in
the applicable Interest Reset Period.

 

3.               Final Maturity. The Stated Maturity Date for any Note
will be the date so specified in the Supplement, which shall be no later than
397 days from the date of issuance. On its Stated Maturity Date, or any date
prior to the Stated Maturity Date on which the particular Note becomes due and
payable by the declaration of acceleration, each such date being referred to as
a Maturity Date, the principal amount of each Note, together with accrued and
unpaid interest thereon, will be immediately due and payable.

 

4.               Events of Default. The occurrence of any of the following
shall constitute an “Event of Default” with respect to a Note:  (i) default in any payment of principal
of or interest on such Note (including on a redemption thereof); (ii) the
Issuer makes any compromise arrangement with its creditors generally including
the entering into any form of moratorium with its creditors generally; (iii) a
court having jurisdiction shall enter a decree or order for relief in respect
of the Issuer in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or there shall be
appointed a receiver, administrator, liquidator, custodian, trustee or
sequestrator (or similar officer) with respect to the whole or substantially
the whole of the assets of the Issuer and any such decree, order or appointment
is not removed, discharged or withdrawn within 60 days thereafter; or (iv) the
Issuer shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consent to the
entry of an order for relief in an involuntary case under any such law, or
consent to the appointment of or taking possession by a receiver, administrator,
liquidator, assignee, custodian, trustee or sequestrator (or similar official),
with respect to the whole or substantially the whole of the assets of the
Issuer or make any general assignment for the benefit of creditors. Upon the
occurrence of an Event of Default, the principal of each obligation evidenced
by such Note (together with interest accrued and unpaid thereon) shall become,
without any notice or demand, immediately due and payable. (2)

 

5.               Obligation Absolute. No provision of the Issuing and Paying
Agency Agreement under which the Notes are issued shall alter or impair the
obligation of the Issuer, which is absolute and unconditional, to pay the
principal of and interest on each Note at the times, place and rate, and in the
coin or currency, herein prescribed.

 

6.               Supplement. Any term contained in the Supplement shall supercede
any conflicting term contained herein.

 

(2)          Unlike single payment notes, where a
default arises only at the stated maturity, interest-bearing notes with
multiple payment dates should contain a default provision permitting
acceleration of the maturity if the Issuer defaults on an interest payment.

 

25

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