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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 30, 1996
----------------------------------
PRIDE PETROLEUM SERVICES, INC.
(Exact name of registrant as specified in its charter)
Louisiana 0-16961 76-0069030
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
1500 City West Blvd., Suite 400
Houston, Texas 77042
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (713) 789-1400
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On April 30, 1996, Pride Petroleum Services, Inc. (the "Company")
acquired all of the outstanding capital stock of Quitral-Co S.A.I.C. ("Quitral-
Co") from Perez Companc S.A., Astra C.A.P.S.A. and other shareholders for
aggregate consideration of $140,000,000, which was negotiated at arms length.
The sellers had no material relationship with the buyer.
Quitral-Co operates 23 drilling and 56 workover rigs in Argentina and 7
drilling and 23 workover rigs in Venezuela. For its last fiscal year (ended
June 30, 1995), Quitral-Co generated revenues of approximately $180,000,000.
For the nine month period ended March 31, 1996, Quitral-Co's revenues were
approximately $150,000,000. The Company expects to continue to operate the
assets of Quitral-Co in Argentina and Venezuela.
The purchase price for the Quitral-Co acquisition consisted of
$110,000,000 cash and a note payable to the sellers for $30,000,000. Of the
cash portion of the purchase price, $70,000,000 was funded from the Company's
working capital and $40,000,000 from the net proceeds from two new financing
arrangements entered into with three lending institutions. The lending
insitutions involved in such financing arrangements are The CIT Group/Equipment
Financing, Inc., Frost National Bank and Heller Financial, Inc.
The Stock Purchase Agreement dated April 30, 1996, between the selling
shareholders and the Company is included as an exhibit hereto. The foregoing
discussion is qualified in its entirety by reference to such exhibit.
2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired.
Provision of financial statements for Quitral-Co required by this item
within 15 days is impracticable. The required financial statements will be
filed by an amendment to this Form 8-K as soon as practicable, but not later
than 60 days after this report is required to be filed.
(b) Pro Forma Financial Information.
Provision of pro forma financial information for Pride Petroleum
Services, Inc. required by this item within 15 days is impracticable. The
required pro forma financial information will be filed by an amendment to this
Form 8-K as soon as practicable, but not later than 60 days after this report
is required to be filed.
(c) Exhibits.
The following exhibits are filed herewith:
EXHIBIT NO. DESCRIPTION
- ----------- -----------------
2 Stock Purchase Agreement, dated April 30, 1996, between Pride
Petroleum Services, Inc. and Perez Companc S.A., Astra
C.A.P.S.A., et al.
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PRIDE PETROLEUM SERVICES, INC.
By: PAUL A. BRAGG
-------------------------------
(Paul A. Bragg)
Vice President and Chief
Financial Officer
Date: May 15, 1996
4
<PAGE>
STOCK PURCHASE AGREEMENT
FOR
QUITRAL - CO S.A.I.C.
BETWEEN
PRIDE PETROLEUM SERVICES, INC.
("PURCHASER")
AND
PEREZ COMPANC S.A.
ASTRA C.A.P.S.A.
RAUL FASCIOLO
PEDRO L. QUERIO
JUAN CARLOS BRUZZON
ALFREDO JUAN LUIS DAVEREDE
("SELLERS")
DATED APRIL 30,1996<PAGE>
<PAGE>
TABLE OF CONTENTS
ARTICLE I Purchase and Sale . . . . . . . . . . . . . . . . . 6
1.01. Transfer of Shares. . . . . . . . . . . . . . . . . 6
1.02. Purchase Price. . . . . . . . . . . . . . . . . . . 6
ARTICLE II The Closing. . . . . . . . . . . . . . . . . . . . 6
ARTICLE III Representations and Warranties of the Sellers . . 6
3.01. Organization and Good Standing. . . . . . . . . . . 7
3.02. Authorization of Agreement. . . . . . . . . . . . . 7
3.03. Capitalization and Ownership of the Company
and the Subsidiary. . . . . . . . . . . . . . . . . 8
3.04. No Violation. . . . . . . . . . . . . . . . . . . . 8
3.05. No Default; Compliance with Laws and Regulations. . 9
3.06. Financial Statements. . . . . . . . . . . . . . . . 9
3.07. Absence of Certain Changes. . . . . . . . . . . . . 10
3.08. Taxes . . . . . . . . . . . . . . . . . . . . . . . 12
3.09. Contracts; Agreements; Plans and Commitments. . . . 13
3.10. Title to Properties . . . . . . . . . . . . . . . . 15
3.11. Accounts Receivable . . . . . . . . . . . . . . . . 15
3.12. Inventories . . . . . . . . . . . . . . . . . . . . 16
3.13. Divestee Companies. . . . . . . . . . . . . . . . . 16
3.14. Environmental; Health and Safety Matters. . . . . . 16
3.15. Litigation. . . . . . . . . . . . . . . . . . . . . 17
3.16. Insurance . . . . . . . . . . . . . . . . . . . . . 18
3.17. Intellectual or Industrial Property . . . . . . . . 18
3.18. Employees and Employee Benefit Matters. . . . . . . 19
3.19. Permits . . . . . . . . . . . . . . . . . . . . . . 21
3.20. Minute Books. . . . . . . . . . . . . . . . . . . . 21
3.21. Books and Records . . . . . . . . . . . . . . . . . 21
3.22. Bank Accounts . . . . . . . . . . . . . . . . . . . 22
3.23. No Brokers. . . . . . . . . . . . . . . . . . . . . 22
3.24. Powers of Attorney. . . . . . . . . . . . . . . . . 22
3.25. Liabilities to Sellers. . . . . . . . . . . . . . . 22
3.26. Certain Payments. . . . . . . . . . . . . . . . . . 22
3.27. Inquiry with Respect to Representations and
Warranties. . . . . . . . . . . . . . . . . . . . . 23
3.28. Disclosure. . . . . . . . . . . . . . . . . . . . . 23
ARTICLE IV Representations and Warranties of the Purchaser. . 23
4.01. Organization and Existence. . . . . . . . . . . . . 23
4.02. Authority and Approval. . . . . . . . . . . . . . . 23
4.03. No Violations . . . . . . . . . . . . . . . . . . . 23
4.04. Purchaser Financial Statements. . . . . . . . . . . 24
4.05. Litigation. . . . . . . . . . . . . . . . . . . . . 24
4.06. No Brokers. . . . . . . . . . . . . . . . . . . . . 24
4.07. Purchaser's Note. . . . . . . . . . . . . . . . . . 24
ARTICLE V Additional Agreements and Covenants . . . . . . . . 25
5.01. Covenants of the Sellers. . . . . . . . . . . . . . 25
5.02. Covenants of the Purchaser. . . . . . . . . . . . . 29
ARTICLE VI Conditions to Closing. . . . . . . . . . . . . . . 30
6.01. Conditions to the Obligations of the Purchaser. . . 30
6.02. Conditions to the Obligations of the Sellers. . . . 34
6.03. Acts to be Performed at Closing . . . . . . . . . . 35
ARTICLE VII Termination . . . . . . . . . . . . . . . . . . . 36
7.01. Grounds for Termination . . . . . . . . . . . . . . 36
7.02. Effect of Termination . . . . . . . . . . . . . . . 36
ARTICLE VIII Extent and Survival of Representations
and Warranties; Indemnification. . . . . . . . . . . 37
8.01. Scope of Representations of the Sellers . . . . . . 37
8.02. Indemnification of the Purchaser. . . . . . . . . . 37
8.03. Indemnification of the Sellers. . . . . . . . . . . 38
8.04. indemnification Procedures. . . . . . . . . . . . . 38
8.05. Remedies Cumulative: Other Remedies . . . . . . . . 38
ARTICLE IX Sellers' Covenants Not to Compete. . . . . . . . . 38
ARTICLE X Expenses. . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE XI Notices; Miscellaneous . . . . . . . . . . . . . . 39
11.01. Notices. . . . . . . . . . . . . . . . . . . . . . 39
11.02. Books and Records. . . . . . . . . . . . . . . . . 40
11.03. Miscellaneous. . . . . . . . . . . . . . . . . . . 40
APPENDIX A Definitions. . . . . . . . . . . . . . . . . . A-1 46<PAGE>
<PAGE>
EXHIBITS
A Form of Purchaser's Note
B Form of Alliance Agreement with Perez Companc S.A.
C Form of Alliance Agreement with Astra C.A.P.S.A.
SCHEDULES
3.06 Financial Statements
3.07 Changes Since December 31, 1995
3.08 Taxes
3.09 Contracts and Commitments
3.10 Title to Properties
3.13 Divestee Companies
3.14 Environmental, Health and Safety Matters
3.15 Litigation
3.16 Insurance Policies
3.17 Intellectual Property
3.18 Employee Compensation and Benefit Arrangements
3.19 Permits
3.22 Bank Accounts
3.24 Powers of Attorney<PAGE>
<PAGE>
STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT (this "Agreement") dated as of
April 30, 1996 among PEREZ COMPANC S.A., ASTRA C.A.P.S.A. and
Messrs. RAUL FASCIOLO, PEDRO L. QUERIO, JUAN CARLOS BRUZZON and
ALFREDO JUAN LUIS DAVEREDE hereinafter collectively referred to
as "Sellers" and PRIDE PETROLEUM SERVICES, INC., hereinafter
referred to as "Purchaser",
WITNESSETH:
WHEREAS, Sellers are the owners of all the issued and
outstanding shares of capital stock (the "Shares" or the "Capital
Stock"), of Quitral-Co S.A.I.C., an Argentine corporation (the
"Company"); and
WHEREAS, except for the Divestee Companies, the only
subsidiary of the Company is Perforaciones Quitral-Co de
Venezuela S.A., a Venezuelan corporation ("Subsidiary"); and
WHEREAS, the Sellers and the Purchaser have executed a
Letter of Intent dated March 18, 1996, relating to the purchase
by the Purchaser of the Shares from the Sellers; and
WHEREAS, the Purchaser desires to acquire the Shares and the
Sellers have agreed to sell the Shares to the Purchaser, upon the
terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and of
the respective representations, warranties, covenants, agreements
and conditions contained herein, the parties hereto hereby agree
as follows. Unless defined elsewhere in this Agreement, all
capitalized terms used herein shall have the respective meanings
given to them in Appendix A hereto, which is incorporated herein
by reference and shall be deemed to be a part of this Agreement
for all purposes.<PAGE>
<PAGE>
ARTICLE I
PURCHASE AND SALE
1.01. TRANSFER OF SHARES. Upon the terms and subject to the
conditions of this Agreement, at the Closing, Sellers will sell
and assign the Shares and deliver to the Purchaser certificates
representing the Shares, duly registered in the Purchaser's name,
against receipt of the Purchase Price for such Shares as provided
in Section 1.02. The Shares will be sold, assigned and delivered
in the form of a single indivisible unit ("por junto") and shall
include all corporate and financial rights pertaining thereto,
including, without implying any restriction whatsoever, the
rights to dividends in shares, in kind or in cash voted upon, as
well as all the rights and actions arising from capitalizations
of reserves, revaluations, capital adjustments and contributions
of all kinds that remain pending and any credit to which Sellers
are entitled vis-a-vis the Company, as of December 31, 1995 and
accrued from December 31, 1995 up to the Closing Date for any
cause or reason, except as provided hereunder with respect to the
Divestee Companies and the Dividend.
1.02. PURCHASE PRICE. Upon the terms and subject to the
conditions of this Agreement, the Purchaser will purchase the
Shares for the Purchase Price. The Purchase Price, other than the
portion thereof evidenced by Purchaser's Note, shall be paid to
Sellers at the Closing by wire transfer in immediately available
funds to the bank account of the Agent as provided in Section
6.03. Purchaser's Note shall be delivered at the Closing to the
Agent.
ARTICLE II
THE CLOSING
The Closing shall be held at the offices of the Agent at
12:00 a.m., local time, on April 30, 1996 or at such other time
and place as shall be agreed upon by the Purchaser and the Agent.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers, jointly and severally, hereby represent and
warrant that:
3.01. ORGANIZATION AND GOOD STANDING. The Company is a
corporation duly organized, validly existing and in good standing
under the laws of Argentina, and has all requisite corporate
power and authority to own and lease the properties and assets it
currently owns and leases and to carry on its business as such
business is currently conducted. The Sellers have heretofore
delivered to the Purchaser true, correct and complete copies of
the articles of incorporation and bylaws (or the equivalent
organization and governance documents), each as amended to the
date hereof, of the Company. The Company is, in all material
respects, duly licensed or qualified to do business and is in
good standing in Argentina and in each Argentine Province where
the Company conducts operations and in all other jurisdictions in
which the character of the properties and assets now owned or
leased by it or the nature of the business now conducted by it
requires it to be so licensed or qualified. The Subsidiary is a
corporation duly organized, validly existing and in good standing
under the laws of Venezuela, and has all requisite corporate
power and authority to own and lease the properties and assets it
currently owns and leases and to carry on its business as such
business is currently conducted. The Sellers have heretofore
delivered to the Purchaser true, correct and complete copies of
the articles of incorporation and bylaws (or the equivalent
organization and governance documents), each as amended to the
date hereof, of the Subsidiary. The Subsidiary is, in all
material respects, duly licensed or qualified to do business and
is in good standing in Venezuela and in each Venezuelan State
where the Subsidiary conducts operations and in all other
jurisdictions in which the character of the properties and assets
now owned or leased by it or the nature of the business now
conducted by it requires it to be so licensed or qualified. The
two corporate Sellers are corporations duly organized, validly
existing and in good standing under the laws of Argentina, and
the four individual Sellers are Argentine citizens.
3.02. AUTHORIZATION OF AGREEMENT. Each of the Sellers has
all requisite power and authority to execute and deliver this
Agreement, to consummate the transactions contemplated hereby and
to perform all the terms and conditions hereof to be performed by
such Seller. The execution and delivery of this Agreement by each
of the Sellers, the performance by each Seller of all the terms
and conditions hereof to be performed by such Seller and the
consummation of the transactions contemplated hereby have been
duly authorized and approved by all requisite action, corporate
or otherwise, on the part of such Sellers. This Agreement
constitutes the valid and binding obligation of each of the
Sellers, enforceable against each of them in accordance with its
terms.
3.03.CAPITALIZATION AND OWNERSHIP OF THE COMPANY AND THE
SUBSIDIARY.
(a) The authorized capital stock of the Company consists
solely of 13,051,613 shares of common stock, par value Argentine
Pesos $ 1 per share, all of which are issued and outstanding on
the date hereof and none of which was either (i) issued in
violation of the preemptive rights of any shareholder or (ii)
subject to any claim therefor by a Seller, which, in any event,
is hereby waived by the Sellers. The authorized and subscribed
capital stock of the Subsidiary consists of 877,800 shares of
common stock, par value Bs. 1,000 per share. All the outstanding
shares of the Company are owned beneficially and of record by the
Sellers, free and clear of all liens, charges, encumbrances,
rights of others, mortgages, pledges or security interests. All
the outstanding shares of the Subsidiary are owned beneficially
and of record by the Company, free and clear of all liens,
encumbrances, rights of others, pledges or security interests.
Except as provided by this Agreement, there are no outstanding
subscriptions, options, convertible securities, warrants,
advances on account of future capital increases or calls of any
kind issued or granted by or binding upon the Sellers, the
Company or the Subsidiary; to issue, purchase or otherwise
acquire any security of or equity interest in the Company or the
Subsidiary. All the Shares have been duly authorized and validly
issued and are fully paid and nonassessable.
(b) The Company does not own, control, have the power to
vote or have the right to acquire, directly or indirectly, an
equity interest in any business entity other than the Subsidiary
and the Divestee Companies.
3.04. NO VIOLATION. Subject to the last paragraph of this
Section 3.04, and as otherwise provided hereunder in Sections
5.03 and 5.04 or as otherwise expressly provided for in this
Agreement, this Agreement and the execution and delivery hereof
by each of the Sellers do not, and the fulfillment and compliance
with the terms and conditions hereof and the consummation of the
transactions contemplated hereby, will not:
(a) conflict with, or require the consent of any person or
entity under, any of the terms, conditions or provisions of the
articles of incorporation, bylaws or equivalent governing
instruments of the two corporate Sellers, the Company or its
Subsidiary;
(b) violate any provision of, or require any filing,
consent, authorization or approval under, any law or
administrative regulation or any judicial, administrative or
arbitration order, award, judgment, writ, injunction or decree
applicable to or binding upon any of the Sellers, the Company or
its Subsidiary;
(c) conflict with, result in a breach of, constitute a
default under (without regard to requirements of notice or the
lapse of time or both), accelerate or permit the acceleration of
the performance required by or require any consent, authorization
or approval under (i) any mortgage, indenture, loan or credit
agreement or other agreement or instrument evidencing
indebtedness for borrowed money to which any of the Sellers, the
Company or its Subsidiary is a party or by which any of the
Sellers, the Company or its Subsidiary is bound or to which any
of their respective properties is subject or (ii) any lease,
license, contract or other agreement or instrument to which any
of the Sellers, the Company or its Subsidiary is a party or by
which any of them is bound or to which any of their respective
properties is subject; or
(d) result in the creation or imposition of any lien, charge
or other encumbrance upon the assets of the Company or its
Subsidiary or upon the Shares, provided, however, that the
representations in this Section 3.04 are made exclusively with
respect to the Sellers, the Company and its Subsidiary.
3.05.NO DEFAULT: COMPLIANCE WITH LAWS AND REGULATIONS.
(a) Neither the Company nor its Subsidiary is in default
under, and no condition exists that with notice or lapse of time
or both would constitute a material default under, (i) any
mortgage, indenture, loan or credit agreement or other agreement
or instrument evidencing indebtedness for borrowed money to which
the Company or its Subsidiary is a party or by which the Company
or its Subsidiary is bound or to which any of their properties is
subject, (ii) any order, judgment or decree of any federal,
provincial, state or municipal court or governmental authority or
(iii) any other agreement, contract, lease, license or other
instrument.
(b) To the best knowledge of the Sellers, the Company and
its Subsidiary have complied in all material respects with all
laws, regulations, orders, judgments or decrees of any federal,
provincial, state or municipal court or governmental authority
applicable to their respective businesses and operations with
respect to which the failure to do so, would have a material
adverse effect on the Company and/or the Subsidiary.
3.06. FINANCIAL STATEMENTS. SCHEDULE 3.06 hereto sets forth
(i) the audited consolidated balance sheets of the Company and
its wholly owned subsidiaries as of June 30, 1994 and June 30,
1995 and the related statement of income, statement of changes in
shareholders equity and cash flows for each of the fiscal years
then ended together in each case with the notes and supplementary
information thereto and the reports of Pistrelli Diaz &
Asociados, correspondent of Arthur Andersen, LLP thereon, and
(ii) the unaudited balance sheets of the Company and its
Subsidiary as of December 31, 1994 and December 31, 1995 and the
related statement of income, statement of changes in
shareholders' equity and cash flows for each of the six-month
periods then ended. Such financial statements are complete and
correct and have been prepared in accordance with Argentine
generally accepted accounting principles applied on a consistent
basis. The balance sheets present fairly the financial position
of the Company and the Subsidiary as of the respective dates
thereof; and the statement of income, statement of changes in
shareholders equity and cash flows included in such financial
statements present fairly the results of operations of the
Company and the Subsidiary for each of the periods covered
thereby. As of December 31, 1995, neither the Company nor the
Subsidiary had any material liabilities, whether absolute,
accrued, contingent or otherwise and whether due or to become
due, which were not appropriately reflected or reserved against
in the December 31 Balance Sheets. The disposition by the
Company of its interests in the Divestee Companies as
contemplated by Section 5.01(d) and as described in SCHEDULE 3.13
will not, on a pro forma basis, reduce the net worth of the
Company, by more than US$ 33,089,438.
3.07. ABSENCE OF CERTAIN CHANGES. Except as provided for or
disclosed in this Agreement, SCHEDULE 3.07, or in the other
schedules to this Agreement, since December 31, 1995, there has
not been:
(a) any material adverse change with a material adverse
effect on the business, financial condition or results of
operations of the Company or its Subsidiary or in its
relationships with their respective employees, customers or
suppliers;
(b) any material damage, destruction or loss with a material
adverse effect on or affecting the business, properties or assets
of the Company or its Subsidiary, whether or not covered by
insurance;
(c) any change by the Company or its Subsidiary in
accounting methods or principles that would be required to be
disclosed under Argentine generally accepted accounting
principles;
(d) any issuance by the Company or its Subsidiary of any
shares of capital stock;
(e) any sale, lease or other disposition of properties and
assets of the Company or its Subsidiary other than in the
ordinary course of business;
(f) any merger or consolidation of the Company or its
Subsidiary with any other corporation, person or entity or any
acquisition by the Company or its Subsidiary of the stock or
business of another corporation, partnership or other entity;
(g) any borrowing of or agreement to borrow funds by the
Company or its Subsidiary, or any termination or material
amendment of any evidence of indebtedness, contract, agreement,
deed, mortgage, indenture, lease, license or other instrument,
commitment or agreement to which the Company or its Subsidiary is
a party or by which either of them or any of their respective
properties are bound, other than in the ordinary course of
business consistent with their respective past practices;
(h) any redemption of, declaration or payment of any
dividend on, or any other distribution with respect to, the
equity securities of the Company (except as provided with respect
to the Divestee Companies and for the U.S. $32,600,000 [Thirty
Two Million Six Hundred Thousand U.S. Dollars] dividend in cash
declared by the Unanimous Shareholders' Meeting of the Company
held on April 29, 1996, in accordance with the requisites
established in Section 47 of Res. 6/80 of the General Inspection
of Corporations on the basis of the special balance sheet as of
December 31, 1995, to be paid by the Company on April 30, 1996
(the "Dividend").
(i) any increase in the compensation payable or to become
payable by the Company or the Subsidiary to their respective
directors, officers or employees (other than in the ordinary
course of business and consistent with past practices and the
Company's and/or its Subsidiary's human resources policies), any
material increase in employee benefits or benefit plan costs or
any increase in any bonus, insurance, pension, compensation or
other benefit plan made for or with or covering any directors,
officers or employees of the Company or the Subsidiary;
(j) any waiver by the Company or its Subsidiary of any
rights that, singularly or in the aggregate, have a material
adverse effect on the business, assets, financial condition or
results of future operation of either the Company or the
Subsidiary;
(k) any mortgage, pledge or grant of a lien or security
interest in any property of the Company or its Subsidiary;
(l) any capital expenditure exceeding US$300,000 or series
or group of related capital expenditures exceeding US$300,000 in
the aggregate;
(m) any material reduction in the proportional participation
of the Company and/or its Subsidiary in the drilling activity in
Argentina and/or Venezuela for Perez Companc S.A. or Astra
C.A.P.S.A. or any material event constituting an unfavorable
change in the main source provider relationship between the
Company and/or its Subsidiary and such Sellers; or,
(n) any contract or commitment to do any of the foregoing.
3.08. TAXES. Except as set forth in SCHEDULE 3.08, the
Company and its Subsidiary have timely filed with the appropriate
foreign, federal, provincial or municipal, local and other
governmental authorities all tax returns, information returns or
statements and reports required to be filed on or before the date
hereof by or with respect to the Company and its Subsidiary, and
have caused to be paid or deposited or made adequate provision
(in accordance with generally accepted accounting principles) for
the payment of all Taxes shown to be due on such returns or
reports except when failure to do so, if any, would not result in
liability for additional Taxes or other payments that exceed US$
25,000 in the aggregate. All information provided in such
returns, statements or reports is complete and accurate in all
material respects. The Company and its Subsidiary have deposited
or made adequate provision in their respective accounts (when so
required in accordance with Argentine generally accepted
accounting principles) for the payment of all Taxes for which the
Company or its Subsidiary may be liable, even if such payments
are not yet due and payable, regardless of whether the liability
for such Taxes is disputed. Except as set forth in SCHEDULE 3.08
hereto, the Company and its Subsidiary have not received, and the
Sellers do not have knowledge of, any notice of deficiency or
assessment or any inspection or administrative proceedings or
proposed deficiency or assessment in excess of the amount of US$
25,000 individually or in the aggregate with respect to the
Company or its Subsidiary or any of their respective properties
from any taxing authority, and there are no outstanding
agreements or waivers by or with respect to the Company or its
Subsidiary that extend the statutory period of limitations
applicable to any federal, foreign, province or state (or
applicable) or local income, municipal or franchise tax returns
for any period and no requests for such agreements or waivers are
pending. Purchaser shall have no liability or obligation for any
Taxes based upon or resulting from the transfer of the shares by
the Sellers as provided in the Agreement. The declaration and/or
the payment of the Dividend by the Company shall not cause the
payment of Taxes to either the Company or the Purchaser and shall
not reduce the net worth of the Company in more than U.S.
$32,600,000 (Thirty Two Million Six Hundred Thousand U.S.
Dollars). The transfer of the shares of the Divestee Companies
and/or the disposition of the interest of the Company in the
Divestee Companies, shall not cause any Taxes or deferred Taxes
to the Company.
3.09. CONTRACTS; AGREEMENTS; PLANS AND COMMITMENTS. Except
for purchase orders and price lists for the drilling and
servicing of wells in the ordinary course of business and any
accessory contract thereto, SCHEDULE 3.09 sets forth a list of
the following contracts, agreements, plans and commitments to
which the Company or its Subsidiary is a party or by which either
of them or any of their respective material properties is bound:
(a) any contract, commitment or agreement that involves
aggregate expenditures by the Company or its Subsidiary of more
than US$ 300,000, other than contracts, commitments or agreements
listed pursuant to other clauses of this Section 3.09;
(b) any indenture, trust agreement, loan agreement or note
under which the Company or its Subsidiary has outstanding
indebtedness, obligations or liabilities for borrowed money in an
amount in excess of US$100,000;
(c) any lease, sublease, installment purchase or similar
arrangement for the use or occupancy of any Rig or real property
that involves aggregate expenditures by the Company or its
Subsidiary of more than US$100,000 per year or is otherwise
material to their respective businesses or is for any Rig,
together with a list of the location of such leased property, the
date of termination of such arrangements, the name of the other
party and the annual rental payments required to be made for such
arrangements;
(d) any agreement that restricts the right of the Company or
its Subsidiary to engage in any type of business;
(e) any guaranty, by the Sellers or any Seller Affiliate,
either direct or indirect, of any contract, lease or agreement
entered into by the Company or its Subsidiary;
(f) any contract or agreement (i) for the sale by the
Company or its Subsidiary to any single customer or group of
related customers of products or services for an aggregate price
of US$ 300,000 or more, or (ii) for the purchase by the Company
or its Subsidiary from any single supplier or group of related
suppliers of raw materials, equipment or services for an
aggregate price of US$ 300,000 or more;
(g) any joint venture, consortium, "union temporaria de
empresas", "agrupacion de colaboracion" and/or any similar
agreement that obligates the Company or its Subsidiary in any
respect; and
(h) any agreement of surety, guarantee or indemnification by
the Company or its Subsidiary outside of the ordinary course of
their respective businesses.
All leases and contracts are in full force and effect and
constitute the legal, valid and binding obligation of the
respective parties thereto and will continue in effect in
accordance with their own terms.
Sellers undertake to obtain that the Technical Assistance
Agreement dated March 13, 1995, between the Subsidiary and
Faraday Investments A.V.V. be canceled as of the Closing Date at
no cost to the Subsidiary.
3.10. TITLE TO PROPERTIES. The Company and its Subsidiary
have good and marketable title to all of their respective assets
and properties (including those reflected on the December 31
Balance Sheets, except to the extent disposed of since such date
in the ordinary course of business), free and clear of all
mortgages, liens, charges, encumbrances, easements, security
interests or title imperfections of any kind or nature, other
than Permitted Encumbrances. All of the buildings, structures and
other improvements constituting a part of the real estate that is
owned or leased by the Company or its Subsidiary, motor vehicles,
machinery, plants, equipment and other personal property owned or
leased by the Company and its Subsidiary and used by the Company
or its Subsidiary in its normal operations are in good operating
condition and repair, subject to ordinary wear and tear with no
known defects which would materially interfere with the use
thereof in the conduct of the business of the Company or its
Subsidiary as presently conducted. The number, size, owner and
location of each of the Rigs as of the date hereof as well as a
list of all real estate properties owned, leased or used by the
Company or its Subsidiary is set forth in SCHEDULE 3.10. The Rigs
located in Venezuela that have not been nationalized in Venezuela
are so identified on SCHEDULE 3.10. No party has, and, as of the
Closing Date, no party other than the Company or its Subsidiary
shall have any right or entitlement whatsoever to use or occupy
the respective assets or properties as lessees or otherwise. To
the knowledge of the Sellers, the Company and its Subsidiary have
duly performed, observed, and complied with all covenants,
restrictions, conditions, agreements, statutory requirements,
orders, building and zoning regulations, planning ordinances and
other regulations, affecting the land and the buildings owned or
leased by the Company and its Subsidiary, and the use thereof.
3.11. ACCOUNTS RECEIVABLE. The accounts receivable shown on
the December 31 Balance Sheets and those recorded on the books of
the Company and its Subsidiary after December 31, 1995 are good
and collectible (other than those accounts receivable which have
been paid since the dates so recorded), subject to reserves for
doubtful accounts of US$120,000 for the Company and no reserves
for the Subsidiary. The reserves for doubtful accounts have been
determined based on a specific review of the accounts and the
past collection experience of the Company and its Subsidiary and
are consistent with its prior accounting and collection
practices. All of the Company's and its Subsidiary's accounts
receivable are valid, genuine and subsisting, arose out of bona
fide sales and deliveries of goods, performance of services or
other arm's-length transactions.
3.12. INVENTORIES. The inventories of materials and
supplies reflected on the December 31 Balance Sheets and those
acquired by the Company and its Subsidiary after December 31,
1995, except to the extent disposed of since the dates recorded
on the books of the Company and its Subsidiary in the ordinary
course of business, are in good, merchantable and usable
condition and have been reflected on the books of the Company and
its Subsidiary in accordance with generally accepted accounting
principles in Argentina. Such inventories have been fully
discounted in value in respect of any obsolete or discontinued
items and, except as set forth in the notes to the financial
statements included in SCHEDULE 3.06 hereto, are owned by the
Company or its Subsidiary free and clear of any liens or
encumbrances in Argentina and Venezuela.
3.13. DIVESTEE COMPANIES. SCHEDULE 3.13 hereto summarizes
the method by which the Company has disposed or plans to dispose
of its interest in each Divestee Company as contemplated by
Section 5.01(d), the consideration, if any, to be received by the
Company in connection with each such disposition, the estimated
tax consequences, if any, to the Company from each such
disposition, and the pro forma effect of each such disposition on
the Company's March 31, 1996 accounting information. Following
the disposition by the Company of its interest in each of the
Divestee Companies, neither the Company nor its Subsidiary will
have any obligations or liabilities, actual or contingent,
arising out of the past or future conduct by the Divestee
Companies of their respective businesses or out of the
disposition by the Company of its interests therein.
3.14. ENVIRONMENTAL; HEALTH AND SAFETY MATTERS. Except as
described on SCHEDULE 3.14 hereto, (i) the Company and its
Subsidiary are, and have continuously been, in compliance in all
material respects with all federal, provincial, state and local
laws, regulations and ordinances relating to environmental,
health and safety matters (including, without limitation, those
relating to toxic and hazardous waste and the discharge of matter
into the air or water), and (ii) the Company and its Subsidiary
have not caused or permitted any Contaminant to be placed, held,
located, released, generated, treated, stored or disposed of
except for Contaminants properly and legally stored or disposed
of in compliance with the Argentine environmental laws and the
Venezuelan environmental laws as necessary for the conduct of the
Company's or its Subsidiary's business. No conditions or
circumstances are known to the Sellers to exist or to have
existed with respect to the Company, its subsidiary, any of its
properties and assets or the conduct of their respective
businesses, including, without limitation, the off-site disposal
of Contaminants, that could give rise to any remedial action
under, or impose any liability on the Company or its Subsidiary
or any owner of the Company or its Subsidiary with respect to,
current statutes, common laws, rules, regulations or orders
regarding any environmental, health or safety matters. Neither
the Company nor its Subsidiary nor any of the Sellers has
received any notice or claim, and none of the Sellers is aware of
any facts suggesting that the Company or its Subsidiary has been
or may be liable to any person as a result of any Contaminant
having been generated, treated, stored, discharged, emitted,
released or transported by either of them. No conditions or
circumstances are known by the Sellers to exist or to have
existed, and no activities are known by the Sellers to be
occurring or to have occurred, that are resulting or have
resulted in the exposure of any person or property to a
Contaminant such that the Company or its Subsidiary may in the
future be liable to such persons or to the owners of such
property for personal or other injuries or damages resulting from
such exposure. The Company and its Subsidiary have obtained and
currently possess all necessary permits and other approvals
necessary to generate, transport, store, dispose of and otherwise
handle Hazardous Materials as defined by Venezuelan and/or
Argentine laws and to operate their respective properties,
assets and businesses and have reported to the extent required
by Venezuelan or Argentine, federal, state and local statutes,
laws, ordinances, regulations, rules, permits, judgments, orders
and decrees all past and present sites owned, leased and/or
operated by the Company and/its Subsidiary where any Hazardous
Material has been generated, transported, released, created,
stored or disposed of and has not used, stored or released any
Hazardous Materials in excess of the amounts allowed by
applicable environmental law.
3.15. LITIGATION. Except as set forth in SCHEDULE 3.15:
(a) There is no action, suit or proceeding pending or, to
the knowledge of the Sellers, threatened against the Company or
its Subsidiary claiming an amount in excess of $50,000 or any
other relief which, if granted, would be adverse to the Company
or its Subsidiary or their ability to conduct their respective
businesses or that would prevent the consummation of the
transactions contemplated by this Agreement provided, however,
that Purchaser will bear all liabilities and afford all
consequences of any employee claim for termination against the
Company or its Subsidiary, directly or indirectly related to or
in connection with the transaction referred hereunder.
(b) Neither the Company nor its Subsidiary is charged with a
violation of or, to the knowledge of the Sellers, threatened with
a charge of a violation of, any provision of any law or
regulation relating to any aspect of their respective businesses.
3.16. INSURANCE. SCHEDULE 3.16 hereto sets forth a complete
and correct list of all material insurance policies by which the
Company and its Subsidiary or any of their respective properties
or assets are covered against present losses, all of which are
now in full force and effect in accordance with their own terms.
The Sellers shall not cause these policies to be terminated. The
insurance proceeds for all claims under all such policies are
payable , without deduction to the Company or its Subsidiary.
3.17. INTELLECTUAL OR INDUSTRIAL PROPERTY. To the knowledge
of the Sellers, SCHEDULE 3.17 hereto contains a complete and
correct description of (i) all trademarks, patents, patent
applications, processes, formulas and trade secrets utilized in
the Company's or its Subsidiary's operations, (ii) all material
non-governmental licenses or sublicenses utilized by the Company
or its Subsidiary in their respective operations and the conduct
of their respective businesses and in the use and sale and in the
promotion for use and sale of the services of the Company or its
Subsidiary, and (iii) all other material covenants or agreements
to which the Company or its Subsidiary is a party which relate in
whole or in part to any of the foregoing items or to any other
material proprietary rights, trade secrets, ideas, know-how,
trademarks, service marks, trade names or copyrights utilized by
the Company and its Subsidiary in their respective operations and
the conduct of their respective business. To the knowledge of the
Sellers, there is no basis for the assertion by any person of any
claim against the Company or its Subsidiary with respect to the
use by the Company or its Subsidiary of any intellectual
(industrial) property of the character described in this Section
3.17. To the knowledge of the Sellers, neither the Company nor
its Subsidiary is infringing or violating, and during the past
five years neither the Company nor its Subsidiary has infringed
or violated, any rights of any person with respect to any such
intellectual (industrial) property and such intellectual
(industrial) property is not subject to any order, injunction or
agreement respecting its use.
3.18. EMPLOYEES AND EMPLOYEE BENEFIT MATTERS. SCHEDULE 3.18
contains a full, complete and accurate list of all employees
working for the Company, including their salary, rank or post
held, seniority and date of employment.
Except for those listed in SCHEDULE 3.18, there are no
management or employment contracts or contracts for personal
services between the Company or its Subsidiary and any officer,
consultant, director, employee or any other person or entity.
The Company and its Subsidiary have complied in all respects
with all laws relating to the employment of labor, including
provisions thereof relating to wages, hours, equal opportunity
and the payment of pension contributions, social security and
other charges and/or Taxes. The salaries, annual bonuses,
accrued vacations and any other payments that may have been due
respectively to the Company's and to the Subsidiary's personnel,
whether past or present, pursuant to applicable labor
legislation, have been punctually and correctly liquidated and
paid to date, and at present there is no existing liability
whatsoever in their respect except as (i) so disclosed by the
Company or its Subsidiary herein or (ii) included on the existing
litigation listed in Schedule 3.15. None of the Sellers are aware
of any labor relations problems affecting or which may affect the
Company or its Subsidiary. Except as listed on SCHEDULE 3.18,
neither the Company nor its Subsidiary is a party to any
collective bargaining agreement. The financial statements
included in SCHEDULE 3.06 correctly reflect all of the
liabilities of the Company and its Subsidiary, contingent or
otherwise, for Labor Indemnities due to the employees and
officers thereof pursuant to the Argentine Labor Law and
Regulations, the Venezuelan Petroleum Industry Collective Labor
Contract and/or any collective or individual labor contracts to
which the Company or its Subsidiary may be a party. Except as
otherwise provided for by the Argentine Labor Laws or the
Venezuelan Petroleum Industry Collective Labor Contract no new,
other, or additional liabilities of the same nature, which are in
the aggregate material, contingent or otherwise, have been
incurred by the Company or the Subsidiary since December 31,
1995. Neither the Company nor its Subsidiary is indebted to any
of their respective employees, officers or directors for
salaries, wages, commissions, fees, emoluments, gratuities or any
other form of compensation or remuneration provided for under the
Argentine and Venezuelan Labor Law and/or the Regulations to the
Argentine Law or the Venezuelan Petroleum Industry Collective
Labor Contract or remuneration for bonuses, night shift pay,
overtime pay, holiday pay, legal profit sharing, industrial
accident or sickness indemnities, travel expenses, per diem
expenses, any benefits provided under the Petroleum Industry
Collective Labor Contracts to which the Company or its Subsidiary
is subject or in any other respect, except as recorded in the
accounting books and records of the Company in accordance with
Argentine generally accepted accounting principles. Except as set
out in SCHEDULE 3.18, neither the Company nor its Subsidiary has
any pension or other retirement plans or programs or any profit-
sharing or other benefit plans for its employees or officers.
The Sellers warrant that, except as provided in SCHEDULE 3.18 the
Company and its Subsidiary are not party to any kind of special
arrangement with its employees or to any agreement of any nature
whereby the company or its Subsidiary is bound to assume
commitments other than those obligations established by Law or by
the applicable Collective Labor Contracts. The books and records
of the Company and its Subsidiary heretofore finished to or made
available for inspection by the Purchaser include an accurate and
complete description of all employee and personal injury claims
made against the Company or its Subsidiary during the past ten
years and the disposition of such claims.
SCHEDULE 3.18 attached hereto which forms an integral part hereof
contains a complete list of all employees of the Subsidiary as of
the date of this Agreement and of the termination indemnities
then due and which may be due to each of them as of March 31,
1996 under the Organic Labor Law and Regulations and/or any
collective or individual labor contract to which the Subsidiary
may be a party. Said Schedule also contains a statement in
respect to each of the employees included in said list of the
anniversary date of such employees employment by the Subsidiary
and of the entire amount of termination indemnities either
credited on the books of the Subsidiary to the account of such
employee or conveyed in trust to the trustee of the employee's
trust as of March 31, 1996. In the event that such termination
indemnities shall have been credited to the account of the
employee on the Subsidiary's books, then such statement shall
also contain the amount of interest therein which shall accrue as
of the next succeeding anniversary date and the amount, if any,
loaned by the Subsidiary to the employee or in respect to which
the Subsidiary has issued a guarantee or undertaken liability as
a survey for the benefit of the employee.
In the event that any of the employees of the Company is in
default under any of the loan agreements entered into between any
such employees (guaranteed by the Company) and Fundacion Perez
Companc, and the latter requests the Company to pay any monies as
guarantor of any such defaulting employee, then, upon payment of
the said monies by the Company, Perez Companc hereby undertakes
to cause Fundacion Perez Companc to assign to the Company all of
its rights under any mortgage or note granted by such defaulting
employee as a guarantee to Fundacion Perez Companc.
3.19. PERMITS. SCHEDULE 3.19 contains a list of the
material licenses, permits, consents, approvals, authorizations,
qualifications and orders of governmental authorities which are
those under which the Company and its Subsidiary are currently
operating their respective businesses.
3.20. MINUTE BOOKS. The minutes of all Shareholders'
Meetings and Board of Directors' Meetings of the Company and its
Subsidiary are fully inscribed in the relevant Minute Books and
are complete and accurate and properly reflect all corporate
actions of the Company and the Subsidiary. All minutes or
resolutions of the Company or the Subsidiary that in accordance
with the laws and regulations of Argentina and Venezuela must be
filed and/or registered in the Public Register of Commerce and
the Commercial Registry, respectively, have in fact been filed
and/or registered therein by the Company or the Subsidiary, as
the case may be. The Minute Books of the Company and its
Subsidiary have been made available, or will be made available
prior to the Closing Date, to the Purchaser for review and
constitute all of the Company's and its Subsidiary's Minute
Books.
3.21. BOOKS AND RECORDS. To the knowledge of the Sellers,
personnel files, reports, accounting and tax records and all
other records of every type and description that relate to the
business of the Company and its Subsidiary have been prepared and
maintained in accordance with good business practices and, where
applicable, in conformity with generally accepted principles and
applicable laws and regulations in Argentina and Venezuela. Such
books and records are located in the offices of the Company in
Buenos Aires, Argentina, in Venezuela, and/or in the district
offices, as applicable.
3.22. BANK ACCOUNTS. SCHEDULE 3.22 hereto contains a list of
all bank accounts maintained by the Company and its Subsidiary
and the name of each person authorized to draw checks on such
accounts.
3.23. NO BROKERS. None of the Sellers has, directly or
indirectly, employed any broker, finder or intermediary in
connection with the transactions contemplated by this Agreement
that might be entitled to a fee or commission from the Purchaser
or the Company upon the execution of this Agreement or the
consummation of such transactions.
3.24. POWERS OF ATTORNEY. Except for those listed in
SCHEDULE 3.24, there are no powers of attorney currently in force
granting authorization to any party to act in the name and on
behalf of the Company or its Subsidiary. None of the Company's or
its Subsidiary's attorneys are entitled to claim from the Company
or its Subsidiary any payment or fee whatsoever, save for those
salaries payable to its employees and the fees described in
SCHEDULE 3.18. No party has any right to fees or payments by
reason of exercising the powers of attorney granted, other than
as set forth on SCHEDULE 3.24 and for legal fees to be paid to
law firms in accordance with the terms of the agreements included
in SCHEDULE 3.24. The revocation of all the powers of attorney
that are listed shall not grant any of the attorneys the right to
claim any amount whatsoever from the Company or its Subsidiary.
3.25. LIABILITIES TO SELLERS. As of the Closing Date neither
the Company nor its Subsidiary will have any agreement with or
liability or obligation to the Sellers or to any Seller
Affiliate, except as provided in Section 5.04.
3.26. CERTAIN PAYMENTS. To the knowledge of the Sellers,
neither the Company, its Subsidiary nor any officer or employee
thereof has paid or caused to be paid, directly or indirectly, in
connection with the business of the Company or its Subsidiary (i)
to any government or agency thereof or to any agent of any
supplier or customer any bribe, kickback or other similar payment
or (ii) any contribution to any political party or candidate
(other than from personal funds of officers or employees not
reimbursed by the Company or its Subsidiary or as otherwise
permitted by applicable law).
3.27. INQUIRY WITH RESPECT TO REPRESENTATIONS AND
WARRANTIES. The representations and warranties set forth in this
Article III which are stated to be "to the best knowledge" or "to
the knowledge" of the Sellers (or contain words of like import)
are so stated based upon the Sellers having made, or having
caused to be made on their behalf, reasonable inquiries with
respect to the matters covered thereby.
3.28. DISCLOSURE. There is no fact known to the Sellers
which materially and adversely affects, or in the future may (so
far as the Sellers can now reasonably foresee) materially and
adversely affect the condition, properties, assets, liabilities,
business, operations or prospects of the Company or its
Subsidiary that has not been set forth herein or heretofore
communicated to the Purchaser in writing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants that:
4.01. ORGANIZATION AND EXISTENCE. The Purchaser is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Louisiana.
4.02. AUTHORITY AND APPROVAL. The Purchaser has all
requisite corporate power and authority to execute and deliver
this Agreement, to consummate the transactions contemplated
hereby and to perform all the terms and conditions hereof to be
performed by it. The execution and delivery of this Agreement by
the Purchaser, the performance by it of all the terms and
conditions hereof to be performed by it and the consummation of
the transactions contemplated hereby have been duly authorized
and approved by all requisite corporate action on the part of the
Purchaser. This Agreement constitutes the legal, valid and
binding obligation of the Purchaser, enforceable against the
Purchaser in accordance with its terms.
4.03. NO VIOLATIONS. This Agreement and the execution and
delivery hereof by the Purchaser do not, and the fulfillment and
compliance with the terms and conditions hereof and the
consummation of the transactions contemplated hereby, will not
violate any provision of or constitute a default (without regard
to any requirement of notice or the lapse of time or both) or
require any consent under any instrument governing the
organization, existence or good standing of the Purchaser or any
law or regulation to which the Purchaser is subject, or any
provision of any material indenture, mortgage, lien, lease,
agreement, instrument, order, arbitration award, judgment or
decree to which the Purchaser is a party or by which the
Purchaser or any of its respective assets or properties is bound.
4.04. PURCHASER FINANCIAL STATEMENTS. The Purchaser has
heretofore delivered to the Agent its Annual Report on Form 10-K
for the fiscal year ended December 31, 1995 as filed with the
U.S. Securities and Exchange Commission. The audited consolidated
financial statements of the Purchaser included in such report
have been prepared in accordance with generally accepted
accounting principles in the United States applied on a
consistent basis during the periods covered thereby and fairly
present the consolidated financial position of the Purchaser and
its subsidiaries as of December 31, 1994 and 1995 and the
consolidated results of their operations, changes in
shareholders equity and cash flows for each of the fiscal years
then ended. Since December 31, 1995, there has not been any
material adverse change in the business, financial condition or
results of operations of the Purchaser.
4.05. LITIGATION. There are no actions, suits, proceedings
or governmental investigations or inquiries pending, or to the
knowledge of the Purchaser, threatened against the Purchaser or
any of its properties, assets or businesses that might delay,
prevent or hinder the consummation of the transactions
contemplated hereby.
4.06. NO BROKERS. The Purchaser has not, directly or
indirectly, employed any broker, finder or intermediary in
connection with the transactions contemplated by this Agreement
that might be entitled to a fee or commission from any of the
Sellers upon execution of this Agreement or the consummation of
such transactions.
4.07. PURCHASER'S NOTE. The issuance by the Purchaser of
Purchaser's Note as part of the Purchase Price has been duly
authorized and approved by all requisite corporate action on the
part of the Purchaser and, when issued at the Closing against
receipt by the Purchaser of the Shares, will constitute the
legal, valid and binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms.
ARTICLE V
ADDITIONAL AGREEMENTS AND COVENANTS
5.01. COVENANTS OF THE SELLERS. The Sellers covenant and
agree with the Purchaser as follows:
(a) CERTAIN CHANGES. Except as may be expressly permitted by
this Agreement or set forth in any Schedule hereto, from the date
hereof until the Closing, without first obtaining the written
consent of the Purchaser, the Sellers will not permit the Company
or its Subsidiary to:
(i) make any material change in the conduct of their
respective businesses or operations;
(ii) except in the ordinary course of business, enter into,
terminate or amend in any material respect any contract or
agreement required to be disclosed pursuant to Section 3.09 or
Section 3.18;
(iii) except as described in SCHEDULE 3.13 with respect to
the disposition of the Company's interests in the Divestee
Companies and for the declaration of the Dividend, declare, set
aside or pay any dividends or make any distributions in respect
of its equity securities, or repurchase, redeem or otherwise
acquire any such securities, or sublease or assign any rights
under any lease, contract or agreement required to be disclosed
pursuant to Section 3.09;
(iv) spin-off, merge into or with or consolidate with any
other corporation or acquire the business or assets of any
corporation, person or entity (or equivalent organizational and
governance documents);
(v) make any change in its articles of incorporation or
bylaws (or equivalent organizational and governance documents);
(vi) purchase any securities of any corporation, person or
entity, except for short-term investments made in the ordinary
course of business consistent with prior practices;
(vii) increase or decrease the indebtedness of the Company
or its Subsidiary other than in the ordinary course of business
consistent with past practices; except for the dividends to be
paid as a result of the disposition of the interest in the
Divestee Companies;
(viii) sell, lease or otherwise dispose of any of its assets
or properties other than pursuant to existing contracts or
commitments or as is otherwise customary in the ordinary course
of business, except for the Divestee Companies;
(ix) purchase, lease or otherwise acquire any property of
any kind whatsoever other than in the ordinary course of
business; or
(x) commit itself to do any of the foregoing.
(b) MAINTENANCE AND COMPLIANCE. Except as may be expressly
permitted hereunder or as set forth in any Schedule hereto, from
the date hereof until the Closing, without first obtaining the
written consent of the Purchaser, the Sellers will cause the
Company and its Subsidiary to:
(i) maintain their respective assets and properties in a
state of condition and repair consistent with the state they had
on the date of this Agreement;
(ii) maintain insurance coverages for its assets, properties
and business comparable to that in effect on the date of this
Agreement;
(iii) maintain their respective books, accounts and records
in a manner consistent with past practices;
(iv) maintain in full force and effect all of the
governmental authorizations referred to in Section 3.19 and all
rights with respect to the intellectual (industrial) property
referred to in Section 3.17 as on the date of this Agreement;
(v) comply with all laws, rules, regulations, ordinances and
other legal requirements applicable to their respective assets,
properties and business as on the date of this Agreement; and
(vi) comply with and perform all of the contracts and
agreements disclosed pursuant to Section 3.09 and all other
contractual obligations relating to or affecting the assets,
properties or business of the Company and its Subsidiary as on
the date of this Agreement.
(c) ACCESS. The Sellers have caused the Company and its
Subsidiary to afford to the Purchaser and its authorized
representatives, at the Purchaser's sole expense, risk and cost
and upon reasonable notice, reasonable access from the date of
execution of the Letter of Intent until the Closing Date, during
normal business hours, to the Company's and its Subsidiary's
personnel, properties, books and records and will cause the
Company and its Subsidiary to furnish to the Purchaser such
available additional financial and available operating data and
other available information as it may reasonably request, to the
extent that such access and disclosure would not unreasonably
interfere with the normal operation of the business of the
Company and its Subsidiary. The Sellers expressly acknowledge and
agree that such access by the Purchaser and its representatives
shall include the right to perform a soil and ground water
analysis of the Company's and its Subsidiary's business
facilities and to conduct such other environmental investigations
of the Company's and its Subsidiary's facilities as the Purchaser
shall deem necessary or appropriate to determine on-site
conditions and the presence or absence of any Contaminants. In
connection with any environmental investigations, the Sellers
will cause the Company and its Subsidiary to provide to or make
available for inspection by the Purchaser and its representatives
(i) all records relating to the disposal of waste materials
generated at the Company's and its Subsidiary's facilities; (ii)
all environmental permits and all records relating to compliance
with such permits; (iii) all records of spills or other releases;
(iv) all records related to employee exposure to workplace
chemicals or Contaminants; (v) all environmental audits or
assessments; (vi) all insurance records relating to coverage for
environmental incidents affecting the Company's and its
Subsidiary's facilities; (vii) all inventories of Contaminants or
other hazardous substances and reports of any emissions thereof;
(viii) all correspondence related to pending or threatened
environmental claims; and (ix) all records obtained from prior
owners or operators of the Company and its Subsidiary or of the
Company's and its Subsidiary's operations relating to
environmental conditions.
(d) DISPOSAL OF INTERESTS. Sellers will cause the Company
to dispose of all of its investments in the Divestee Companies as
described in SCHEDULE 3.13 hereto prior to the Closing and such
disposition will not result in any adverse tax consequence to the
Company or its Subsidiary.
(e) BEST EFFORTS. The Sellers will use their Best Efforts to
obtain the satisfaction of the conditions to Closing set forth in
Section 6.01 hereof
(f) NO NEGOTIATIONS. The Sellers shall not, and shall not
permit the Company or its Subsidiary to, solicit from any
corporation, business or person any proposals or offers, or enter
into any negotiations, relating to the disposition of all or
substantially all the Company's or its Subsidiary's assets or
business, or the acquisition of the Shares, or the spin-off,
merger or consolidation of the Company or its Subsidiary with any
person, corporation or other entity.
(g) CONFIDENTIALITY. After the Closing Date, the Sellers
shall not, and shall not permit any Seller Affiliate to, directly
or indirectly, use or provide to any other person any non public
information concerning the business or operations (financial or
other) of the Company or its Subsidiary except (i) in compliance
with information requirements to companies listed in a stock
exchange or by securities laws; or (ii) as on the advice of
counsel is required in governmental filings or judicial,
administrative or arbitration proceedings.
(h) BANK ACCOUNTS. The Sellers shall, if requested by the
Purchaser, as of the Closing Date, cause the Company to cancel
the authority of any person or persons who are listed in SCHEDULE
3.22 hereto to draw checks on any of the bank accounts maintained
by the Company and its Subsidiary and shall provide to the
Purchaser evidence of said cancellation.
(i) PUBLIC ANNOUNCEMENTS. Subject to applicable securities
law or stock exchange requirements, at all times until the
Closing Date, the Sellers shall obtain the approval of the
Purchaser before issuing, or permitting any of the Sellers'
directors, officers, employees or agents or any Seller Affiliate
to issue, any press release with respect to this Agreement or the
transactions contemplated hereby provided, however, that in no
event shall any notice include the names of the physical persons
included among the Sellers.
(j) NOTIFICATION. Pending the Closing, the Seller shall
promptly notify the Purchaser in writing and keep it advised as
to (i) any litigation or administrative proceeding pending and
known to them or, to their knowledge, threatened against them
which challenges materially the transactions contemplated hereby;
(ii) any material damage to or destruction of any of the material
assets or properties of the Company or its Subsidiary; (iii) any
material adverse change in the business, prospects or results of
operation of the Company or its Subsidiary; and (iv) any material
variance from the representations and warranties contained in
Article III hereof or any failure or inability on the part of any
of the Sellers to comply with the Sellers' agreements and
covenants contained in this Agreement in any material respect.
5.02. COVENANTS OF THE PURCHASER. The Purchaser covenants
and agrees with the Sellers as follows:
(a) BEST EFFORTS. The Purchaser will use its Best Efforts to
obtain the satisfaction of the conditions to Closing set forth in
Section 6.02.
(b) PUBLIC ANNOUNCEMENTS. Subject to applicable securities
law or stock exchange requirements, at all times until the
Closing Date, the Purchaser shall obtain the approval of the
Sellers before issuing, or permitting any of the Purchaser's
officers, employees, agents or affiliates to issue, any press
release with respect to this Agreement or the transactions
contemplated hereby provided, however, that in no event shall any
notice will include the names of the physical persons included
among the Sellers .
(c) CONFIDENTIAL INFORMATION. In the event that this
Agreement is terminated or, if not terminated, until the Closing
Date, the confidentiality of any data or information received by
the Purchaser regarding the business and assets of the Company or
its Subsidiary shall be strictly maintained by the Purchaser and
its representatives in accordance with the Confidentiality clause
in Section 8 of the Letter of Intent of March 18, 1996.
(d) NOTIFICATION. The Purchaser shall promptly notify the
Sellers in writing and keep them advised as to (i) any
litigation or administrative proceeding pending and known to it
or, to its knowledge, threatened against the Purchaser which
challenges the transactions contemplated hereby; and (ii) any
material variance from the representations and warranties
contained in Article IV hereof or any failure or inability on the
part of the Purchaser to comply with any of its agreements and
covenants contained in this Agreement.
(e) PAYMENT OF DIVIDEND. The Purchaser shall cause the Company to
pay the Dividend to the Agent on April 30, 1996.
5.03. FIRST NATIONAL BANK OF BOSTON FACILITY. The
Purchaser acknowledges and agrees that the Company and its
Subsidiary have obtained credit facilities from the First
National Bank of Boston and that such credit facilities require
that Perez Companc S.A. shall continue holding at least 50% of
outstanding voting shares of or otherwise maintain control of the
Company.
5.04. At present, Company is indebted to International
Finance Corporation ("IFC"); such indebtedness guaranteed by
Petroquimica Cuyo's shares, which is one of the Divestee
Companies. Since these shares will be transferred by the Company,
Perez Companc will substitute Company as debtor to IFC, and
Company will be indebted to Perez Companc in U.S. $1,687,584 (One
Million Six Hundred and Eighty Seven Thousand U.S. Dollars) in
the same terms as it was indebted to IFC.
ARTICLE VI
CONDITIONS TO CLOSING
6.01. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER. The
obligations of the Purchaser to proceed with the Closing
contemplated hereby are subject to the satisfaction on or prior
to the Closing Date of all of the following conditions, any one
or more of which may be waived, in whole or in part, in writing
by the Purchaser:
(a) COMPLIANCE. The Sellers shall have complied with their
covenants and agreements contained herein, and the
representations and warranties of the Sellers contained in
Article III hereof shall be true on and as of the Closing Date in
all material respects.
(b) OFFICERS' CERTIFICATE. The Purchaser shall have received
a certificate, dated the Closing Date, executed by an executive
officer of the Agent, certifying as to the matters specified in
Section 6.01(a) hereof.
(c) LEGAL OPINIONS. The Purchaser shall have received from
Estudio Bruzzon & Asociados, Argentine counsel to the Sellers,
opinions dated the Closing Date, to the effect that:
(i) The Company is a corporation duly organized, validly
existing and in good standing under the laws of Argentina; and
has the corporate power and authority to own its respective
properties and assets and to carry on their respective business
as now being conducted. The Company is duly licensed or qualified
to do business as a corporation and is in good standing in the
Argentine Federal District and the Provinces of Santa Cruz,
Chubut, Rio Negro, Neuquen, La Pampa and Mendoza.
(ii) Each of the Sellers has the power and authority,
corporate or otherwise, to execute and deliver this Agreement and
to consummate the transactions contemplated hereby; all acts and
other proceedings required to be taken by or on the part of each
of the Sellers to execute and deliver this Agreement and to
consummate the transactions contemplated hereby have been duly
and validly taken; and this Agreement has been duly executed and
delivered by, and constitutes the legal, valid and binding
obligation of, each of the Sellers, enforceable against them in
accordance with its terms.
(iii) The authorized capital stock of the Company consists
solely of 13,051,613 shares of capital stock, all of which are
validly issued and outstanding, fully paid and nonassessable,
none of which either (i) was issued in violation of the
preemptive rights of any stockholder or (ii) is subject to any
Seller claim therefor. and all of which are being duly
transferred to Purchaser by Sellers, free and clear of any
advanced capital contributions in exchange for future issuance of
shares, outstanding options, liens, pledges, security interests,
charges or encumbrances; and there are no outstanding options,
warrants or calls of any kind relating to any capital stock of
the Company.
(iv) To the best of such counsel's knowledge (based on the
standard of inquiry set forth in Section 3.27 hereof), there are
no material actions, suits or proceedings pending against or
affecting the Company or its Subsidiary other than as disclosed
pursuant to Section 3.15.
(v) The execution and delivery by each of the Sellers of
this Agreement do not and the consummation of the transactions
contemplated hereby will not violate any provision of or
constitute a default (without regard to any requirement of notice
or lapse of time or both) under (A) the articles of incorporation
or bylaws of the Company or its Subsidiary or equivalent
organization and governance documents or (B) any provision of
any material indenture, mortgage, lien, lease, agreement,
instrument, order, arbitration award, judgment or decree known to
such counsel, to which any Seller or the Company is a party or
by which any of them or any of their respective assets or
properties are bound.
(vi) The Alliance Agreements have been duly executed and
delivered by, and constitute the legal, valid and binding
obligations of, Perez Companc S.A. and Astra C.A.P.S.A.,
respectively, enforceable against each of them in accordance with
their respective terms.
In addition, the Purchaser shall have received from Clyde &
Co., Venezuelan counsel to the Subsidiary, opinions dated the
Closing Date, to the effect that:
(i) The Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of Venezuela and has
the corporate power and authority to own its properties and
assets and to carry on its business as now being conducted. The
Subsidiary is duly licensed or qualified to do business as a
corporation and is in good standing in the Venezuelan States of
Anzoategui, Zulia and Monagas.
(ii) The authorized capital stock of the Subsidiary consists
solely of 877,800 shares of capital stock, all of which are
validly issued and outstanding, fully paid and nonassessable and
owned of record and beneficially by the Company, free and clear
of any liens, pledges, security interests, charges or
encumbrances, and there are no outstanding options, warrants or
calls of any kind relating to any capital stock of the
Subsidiary.
(iii) To the best of such counsel's knowledge (based on the
standard of inquiry set forth in Section 3.27 hereof), there are
no material actions, suits or proceedings pending against or
affecting the Subsidiary other than as disclosed pursuant to
Section 3.15.
(iv) The execution and delivery by each of the Sellers of
this Agreement do not and the consummation of the transactions
contemplated hereby will not violate any provision of or
constitute a default (without regard to any requirement of notice
or lapse of time or both) under (A) the articles of incorporation
or bylaws of the Subsidiary or equivalent organization and
governance documents or (B) any provision of any material
indenture, mortgage, lien, lease, agreement, instrument, order,
arbitration award, judgement or decree known to such counsel, to
which the Subsidiary is a party or by which it or any of its
assets or properties are bound.
(d) NO INJUNCTION, ETC. No action of any private party or
governmental agency shall have been taken and no statute, rule,
regulation or executive order shall have been proposed,
promulgated or enacted by any federal or state governmental
authority which seeks to restrain, enjoin or otherwise prohibit
or to obtain damages or other relief in connection with this
Agreement or the transactions contemplated hereby.
(e) MATERIAL ADVERSE CHANGES. The Purchaser shall not have
discovered any event, occurrence or condition at or affecting the
business, financial position or properties of the Company or its
Subsidiary, whether or not previously known to the Sellers and
whether or not subject to indemnification hereunder, which has
resulted or may reasonably be expected to result in a reduction
in the combined net worth of the Company and its Subsidiary as
reflected on the December 31 Balance Sheets (after giving effect
to the disposition of the Company's interests in the Divestee
Companies as described in SCHEDULE 3.13) by more than 5%.
(f) RESIGNATIONS. There shall have been delivered to the
Purchaser (i) the resignation, effective no later than the
Closing Date, of each director of the Company and of its
Subsidiary to their offices as Board Members and the waiver by
each director of their rights to any fees to which they may be
entitled only by reason of their resignations to such offices
without affecting their rights to any payment accrued up to such
date consistent with past practices and the Purchaser will,
simultaneously upon Closing and with effect as from such moment,
cause the Company and its Subsidiary to accept such resignation,
and release all such directors from any liability and resign any
right to any claim therefor, (ii) the resignation, effective no
later than the Closing Date, of each Seller who is an employee or
former employee of the Company and/or of its Subsidiary and the
waiver by each of them to their rights to any salaries,
retirements, or any other consideration to which they may be
entitled by reason of their labor relationship with the Company
or its Subsidiary except for the rights to any payment accrued up
to such date consistent with past practices. Sellers undertake to
hold the Purchaser harmless from any claims by any Seller who is
an employee based upon the labor relationship with the Company
and/or its Subsidiary and (iii) the resignation, effective no
later than the Closing Date, of each syndic of the Company to
their offices and the waiver by each syndic of their rights to
any fees to which they may be entitled only by reason of their
resignations to such offices without affecting their rights to
any payment accrued up to such date consistent with past
practices and the Purchaser will, simultaneously upon Closing and
with effect as from such moment, cause the Company to accept such
resignation, and release all such syndics from any liability and
resign any right to any claim therefor.
(g) ALLIANCE AGREEMENTS. Perez Companc S.A. and Astra
C.A.P.S.A. shall have executed and delivered Alliance Agreements
having the terms and being in the forms of Exhibits B and C
hereto, respectively.
(h) GOVERNMENTAL CONSENT(S). All required governmental
consents shall have been obtained and/or all waiting periods
shall have expired or been terminated.
(i) REPAYMENT OF ADVANCES. Except as provided in 5.04, the
Company and/or its Subsidiary shall have repaid all advances and
loans made to them by any Seller or any Seller Affiliate.
6.02. CONDITIONS TO THE OBLIGATIONS OF THE SELLERS. The
obligations of the Sellers to proceed with the Closing
contemplated hereby are subject to the satisfaction on or prior
to the Closing Date of all of the following conditions, any one
or more of which may be waived, in whole or in part, in writing
by the Sellers.
(a) COMPLIANCE. The Purchaser shall have complied with each
of its covenants and agreements contained herein, and each of its
representations and warranties contained in Article IV hereof
shall be true on and as of the Closing Date in all material
respects.
(b) OFFICER'S CERTIFICATE. The Sellers shall have received a
certificate dated the Closing Date from the President of the
Purchaser, certifying as to the matters specified in Section
6.02(a) hereof
(c) LEGAL OPINIONS. The Sellers shall have received from
Messrs. Baker & Botts, LLP, counsel to the Purchaser, an opinion
dated the Closing Date to the effect of the matters set forth in
Sections 4.01, 4.02, 4.05 and 4.07, and Messrs. Brons & Salas,
Argentine counsel to the Purchaser, an opinion dated the Closing
Date to the effect of the matter set forth in the last sentence
of Section 4.01.
(d) NO INJUNCTION, ETC. No action of any private party or
governmental agency shall have been taken and no statute, rule,
regulation or executive order shall have been promulgated or
enacted by any federal or state governmental authority which
seeks to restrain, enjoin or otherwise prohibit or to obtain
damages or other relief in connection with this Agreement or the
transactions contemplated hereby.
(e) ALLIANCE AGREEMENTS. The Alliance Agreements having the
terms and being in the forms of Exhibits B and C hereto shall
have been executed and delivered by the Purchaser with Perez
Companc S.A. and Astra C.A.P.S.A, respectively.
(f) GOVERNMENTAL CONSENT(S). All required governmental
consents shall have been obtained and/or all waiting periods
shall have expired or been terminated.
6.03. ACTS TO BE PERFORMED AT CLOSING. The acts to be
performed at Closing shall be carried out simultaneously.
(a) Sellers shall deliver to Purchaser letters addressed to
the Company and signed by Sellers notifying the transfer of the
Shares to Pride International, Ltd., a British Virgin Islands
corporation and wholly owned subsidiary of the Purchaser, in a
form acceptable to counsel for Purchaser. Pride International,
Ltd. hereby jointly and severally guarantees all obligations
assumed by Purchaser hereunder.
(b) Sellers shall deliver to Pride International, Ltd., the
stock certificates representing the Shares.
(c) Purchaser shall deliver to the Agent Seventy Seven
Million Four Hundred Thousand Dollars (U.S. $77,400,000) by
making a wire transfer of said amount to the Agent's Account No
36968355 with CITIBANK New York, located at 111 Wall Street, 21st
floor, New York, 10043, USA.
(d) Purchaser shall issue and deliver to the Agent its
Purchaser's Note in the original principal amount of Thirty
Million Dollars (US$ 30,000,000) payable in installments and
being in the form of Exhibit A hereto.
(e) Sellers, the Agent and Purchaser shall execute and
deliver appropriate cross-receipts for the items described in
subparagraphs (a) through (d) of this Section 6.03.
ARTICLE VII
TERMINATION
7.01. GROUNDS FOR TERMINATION. This Agreement may be
terminated at any time prior to the Closing:
(a) by the mutual written agreement of the Sellers and the
Purchaser;
(b) by either the Sellers or the Purchaser by written notice
thereof to the other if the purchase and sale of the Shares
contemplated hereby shall not have been consummated by May 31,
1996; or
(c) by either the Sellers or the Purchaser if the
consummation of the transactions contemplated hereby would
violate any nonappealable final order, decree or judgment of any
court or governmental body having competent jurisdiction
enjoining, restraining or otherwise preventing, or awarding
substantial damages in connection with, the consummation of this
Agreement or the transactions contemplated hereby; PROVIDED,
HOWEVER, that a party shall not be allowed to exercise any right
of termination pursuant to this Section 7.01 if the event giving
rise to such right shall be due to the breach by such party in
any material respect of its representations and warranties herein
or the negligent or willful failure of such party to perform or
observe in any material respect any of the covenants or
agreements set forth herein to be performed or observed by such
party.
7.02. EFFECT OF TERMINATION. The following provisions shall
apply in the event of a termination of this Agreement:
(a) If this Agreement is terminated by the Sellers or the
Purchaser as permitted under Section 7.01 hereof and not as the
result of the breach by such party in any material respect of its
representations and warranties herein or the negligent or willful
failure of any party to perform its obligations hereunder, such
termination shall be without liability of any party to this
Agreement or any shareholder, director, officer, employee, agent
or representative of such party.
(b) If the conditions precedent referred in Section 6.01
have been met, then if Purchaser does not complete the
acquisition for its own causes, it shall pay Sellers the amount
of US$ 2,000,000 plus their actual out-of-pocket fees and
expenses related to this transaction.
(c) If the conditions precedent referred in Section 6.02
have been met, then if Sellers do not complete the acquisition
for its own causes, they shall pay Purchaser the amount of
US$1,000,000 plus their actual out-of-pocket fees and expenses
related to this transaction.
(d) The Sellers and the Purchaser hereby agree that the
provisions of Section 5.02(c), Article X and Sections 11.01 and
11.03 (b) hereof shall survive any termination of this Agreement.
Nothing in this Section 7.02 shall be deemed in any way to limit
the right of any party hereto to specific performance or such
other injunctive or equitable relief to which such party may be
entitled.
ARTICLE VIII
EXTENT AND SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION
8.01. SCOPE OF REPRESENTATIONS OF THE SELLERS. Except as and
to the extent expressly set forth in Article III hereof, the
Sellers make no representations or warranties whatsoever, and
disclaim all liability and responsibility for any representation,
warranty, statement or information made or communicated (orally
or in writing) to the Purchaser (including, but not limited to,
any opinion, information or advice which may have been provided
to the Purchaser by any officer, shareholder, director, employee,
agent, consultant or representative of any of the Sellers or the
Company, the Sellers' counsel or any other agent, consultant or
representative).
8.02. INDEMNIFICATION OF THE PURCHASER. The Sellers,
jointly and severally, agree to defend and indemnify the
Purchaser against, and hold the Purchaser harmless from any
Purchaser Indemnified Loss, without including any additional
damage or increase in any existing damages after the Closing Date
due to Purchaser's acts or omissions.
8.03. INDEMNIFICATION OF THE SELLERS. The Purchaser agrees
to indemnify the Sellers against, and hold the Sellers harmless
from, any Seller Indemnified Loss, without including any
additional damage or increase in any existing damages after the
Closing Date due to any of Seller's acts or omissions.
8.04. INDEMNIFICATION PROCEDURES.
(a) The Purchaser or any affected subsidiary of the
Purchaser will give the Sellers reasonable written notice of any
Purchaser Indemnified Loss and the Sellers or the Agent will
likewise give the Purchaser reasonable written notice of any
Seller Indemnified Loss; provided that the failure to give notice
of a matter that may give rise to an indemnification claim shall
not affect the rights of any party to such indemnification,
except to the extent such failure materially prejudices the
ability of the indemnifying party to defend against such claim.
(b) The indemnifying party or parties shall be entitled to
undertake the defense, compromise and/or settlement of any claim
subject to indemnification pursuant to Sections 8.02 or 8.03. If
within a reasonable time after notice of any such claim, such
indemnifying party or parties fail to defend, then the party or
parties entitled to such indemnification shall (upon further
notice to the indemnifying party or parties) have the right, at
the indemnifying parties' expense (including reasonable attorney'
s fees), to undertake the defense, compromise or settlement of
such claim at any time prior to settlement, compromise and/or
final determination thereof.
(c) In all these cases, the party entitled to such
indemnification shall fully cooperate with the indemnifying party
in providing any reasonable information or evidence necessary for
the indemnifying party to conduct or defend any claim subject to
indemnification.
8.05 REMEDIES CUMULATIVE: OTHER REMEDIES. The remedies
provided for herein shall be cumulative and shall not preclude
assertion by any party hereto of any other rights or the seeking
of any other remedies, including, without limitation, the
remedies of specific performance and injunction.
ARTICLE IX
SELLERS' COVENANTS NOT TO COMPETE
Except as otherwise consented to or approved in writing by
the Purchaser, none of the Sellers nor any Seller Affiliate will
at any time for a period of seven years following the Closing
Date, directly or indirectly, acting alone or as a member of a
partnership or as a holder of in excess of 5% of any security of
any class, or as a consultant to or representative of, any
corporation or other business entity, engage in any business in
competition with the same type of equipment and in the same
services conducted by the Company or its Subsidiary at the date
hereof. Should Purchaser be in default of its payment obligations
under the Note or in the event of any material default by
Purchaser under the Service Alliance Agreement and upon notice
from the Sellers, such failure to comply continues uncorrected
for thirty days, then this no competition covenant shall be
automatically terminated.
ARTICLE X
EXPENSES
Except as specifically provided herein, all legal and other
costs and expenses in connection with this Agreement and the
transactions contemplated hereby shall be paid by the Sellers
(and not by the Company) or the Purchaser, as the case may be,
depending upon which party incurred such costs and expenses.
ARTICLE XI
NOTICES; MISCELLANEOUS
11.01. NOTICES. All notices and other communications given
hereunder shall be in writing and shall be deemed given if
delivered personally or by any certifiable means, to the parties
at the following addresses:
(A) If to the Sellers, to:
the Agent at:
Maipu 1
(1599) Buenos Aires
Argentina
Att.: Legal Department
(B) If to the Purchaser, to:
Pride Petroleum Services, Inc.
Att: Legal Department
1500 City West Boulevard, Suite 400
Houston, TX 778042
with a copy to:
Pride Petrotech S.A.M.P.I.C.
Attt: President
Suipacha 268 Piso 13
1355 - Buenos Aires - Argentina
11.02. BOOKS AND RECORDS. The Sellers agree that they will
deliver or cause to be delivered to the Purchaser on the Closing
Date all corporate minute books and stock transfer records of the
Company and the Subsidiary to the extent that such books and
records are not then in the possession of the Company.
11.03. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. NO WAIVERS. This Agreement, together
with the Schedules and Exhibits hereto, sets forth the entire
agreement and understanding of the parties with respect to the
transactions contemplated hereby and supersedes all prior
agreements, arrangements and understandings relating to the
subject matter hereof. No representation, warranty, promise,
inducement or statement of intention has been made by any party
hereto which is not embodied in this Agreement, and no party
shall be bound by or liable for any alleged representation,
warranty, promise, inducement or statement or intention not so
set forth. This Agreement may be amended, modified, superseded or
canceled, and any of the terms, provisions, representations,
warranties, or conditions hereof may be waived, only by a written
instrument executed by all parties hereto or, in the case of a
waiver, by the party waiving compliance. The failure of any party
at any time or times to require performance of any provisions
hereof shall in no manner affect the right later to enforce the
same. No waiver by any party of any condition, or of the breach
of any term, provision, representation or warranty contained in
this Agreement or in any written statements, certificates or
other such documents to be delivered pursuant hereto or in
connection with the transactions contemplated hereby, whether by
conduct or otherwise, in any one or more instances, shall be
deemed to be or construed as (i) a further or continuing waiver
of any such condition or breach, (ii) a waiver of any other
condition or breach, or (iii) a breach of any other term,
provision, representation or warranty.
(b) DISPUTE RESOLUTION. Any dispute arising out of or in
connection with this Agreement, including any question regarding
its existence, validity or termination, shall be referred to and
finally resolved by the United States District Court in the City
of New York, U.S.A. The governing law of this Agreement shall be
the law of the Republic of Argentina.
(c) HEADINGS. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Terms such as
"herein", "hereby" and "hereof' refer to this Agreement as a
whole.
(d) ASSIGNMENTS AND THIRD PARTIES. No party hereto shall
assign this Agreement or any part hereof without the prior
written consent of the other party, except that Purchaser may at
any time assign its rights but not its obligations, to Pride
International, Ltd. or another wholly owned subsidiary of
Purchaser, including the Company. No such assignment shall
release the Purchaser of any of its obligations under this
Agreement. Except as otherwise provided herein, this Agreement
shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. Nothing in
this Agreement shall entitle any person other than the Sellers,
the Purchaser or their respective permitted successors and
assigns to any claim, cause of action, remedy or right of any
kind.
(e) SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by
any rule of law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any
adverse manner to either party. Upon any binding determination
that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable
manner, to the end that the transactions contemplated hereby may
be completed to the extent possible.
(f) COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an
original and all of which together shall constitute but one and
the same agreement.
(g) FURTHER ASSURANCES. The Sellers and the Purchaser each
agree to deliver or cause to be delivered to the other on the
Closing Date, and at such other times thereafter as shall be
reasonably requested, any additional instrument that the other
may reasonably request for the purpose of carrying out this
Agreement.
(h) PRESERVATION OF BOOKS AND RECORDS. For the appropriate
period under Argentina law after the Closing Date, the Purchaser
shall (i) preserve and retain the corporate, accounting, legal,
auditing and other books and records of the Company and its
Subsidiary that relate to the conduct of their respective
businesses and operations prior to the Closing Date (including,
but not limited to, any documents relating to any governmental or
non-governmental actions, suits, proceedings or investigations
arising out of the conduct of the business and operations of the
Company prior to the Closing Date) and (ii) make such books and
records available at the then current administrative headquarters
of the Company to the Sellers and their officers, employees and
agents upon reasonable notice and at reasonable times, it being
understood that the Sellers shall be entitled to make and retain
copies of any such books and records as they shall deem
necessary. The Purchaser agrees to permit representatives of the
Sellers to meet with employees of the Purchaser, the Company and
its Subsidiary on a mutually convenient basis in order to enable
the Sellers to obtain additional information and explanations of
any materials provided pursuant to this Section 11.03(h).
(i) SELLER'S AGENT. The Agent is hereby appointed by each of
the other Sellers as the collective attorney-in-fact of all of
the Sellers, with full power and authority in the names of and
for and on behalf of all of the Sellers, to (i) receive from the
Purchaser the Purchase Price for the Shares, (ii) act as Payee
under the Purchaser's Note and allocate among the respective
Sellers payments and credits of principal and interest under the
Purchaser's Note, (iii) amend or waive any provision of this
Agreement pursuant to provisions of Article VII, (iv) deliver
share certificates, certificates, confirmations, receipts and
other documents required or contemplated by this Agreement or
terminate this Agreement to be delivered by or on behalf of the
Sellers at Closing, (v) resolve any dispute with Purchaser over
any aspect of this Agreement, (vi) do all other things and take
all other action under or related to this Agreement (including to
receive the Dividend and allocate the same among the Sellers)
and/or the Purchaser's Note which, in its discretion, the Agent
may consider necessary or proper to consummate the transactions
provided for herein, (vii) serve and receive notices regarding
any dispute arising from this Agreement, initiate legal actions
and appoint attorneys for such purpose with ample powers to
represent Sellers in Court or out-of-Court and (viii) enter into
any agreement to effectuate any of the foregoing, any and all of
which actions by the Agent shall have the effect of binding each
of the Sellers as if each of the Sellers had personally taken
such actions; PROVIDED, however, that all actions taken or
decisions made by the Agent on behalf of the Seller shall be
taken or made in a manner which affects all of the Sellers
ratably and equitably in accordance with their relative
percentage ownership of the Shares. This appointment and power of
attorney shall be deemed to be coupled with an interest and the
authority conferred on the Agent by this Section 11.03 (i) shall
be irrevocable in accordance with Section 1977 of Argentine Civil
Code for the term of ten years and shall not be subject to
termination by operation of law, whether by the death or
incapacity or liquidation or dissolution of any other Seller or
the occurrence of any other event or events, and the Agent may
not terminate this power of attorney with respect to any other
Seller such other Seller's successors or assigns without the
written consent of the Purchaser. Each of the other Sellers
agrees to hold the Agent harmless from any and all loss, damage
or liability or expense (including legal fees) which such other
Seller may sustain as a result of any action taken in good faith
by the Agent.
(j) TRANSFER OF PERMITS. DATA TRANSMISSION AGREEMENT. Sellers
undertake to carry out any action and/or execute any documents
that may be reasonably required in order to transfer to the
Company or to the Subsidiary, as the case may be, any licenses,
permits, consents, approvals, authorizations, qualifications
and/or orders of governmental authorities which are currently
used by the Company or by the Subsidiary in carrying out their
respective business which are not in their respective names,
including but not being limited to the license/s of the "Comision
Nacional de Telecomunicaciones" necessary for the Company to
operate the VHF equipments currently used by the same.
In addition, Perez Companc S.A. hereby undertakes to make
reasonable efforts to obtain that the data transmission and
reception agreement dated July 8, 1996 currently in force between
IMPSAT S.A. and the Company be maintained with the same tariffs
applicable to those companies related to the Perez Companc group.
(k) LAWSUIT AGAINST TRANSPORTES LOPEZ HNOS. S.A. Perez Companc
S.A. is currently engaged in a lawsuit against Transportes Lopez
Hnos. S.A. to recover the amount of $471,615.74 paid by the
Company in the lawsuit "Fratti, Mario c/ Compania Naviera Perez
Companc S.A. y otros s/Ordinario". Perez Companc S.A. hereby
undertakes to assign to the Company all of the rights against
Transportes Lopez Hnos. S.A. related with this issue within a
three (3) day term.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first written above.
PURCHASER:
PRIDE PETROLEUM SERVICES, INC.
By: RAY H. TOLSON
------------------
Name:Ray H. Tolson
Position: President
SELLERS:
PEREZ COMPANC S.A. ASTRA C.A.P.S.A.
- ------------------ ----------------
Name: Name:
Position: Position:
- ------------------ ----------------
PEDRO L. QUERIO RAUL FASCIOLO
- ------------------ ----------------
JUAN CARLOS BRUZZON ALFREDO JUAN LUIS DAVEREDE
In our respective capacities as spouses of Messrs. Pedro L.
Querio, Raul Fasciolo, Juan Carlos Bruzzon and Alfredo Juan Luis
Daverede, and within the scope set forth by Section 1277 of
Argentine Civil Code, we render our consent in respect of the
terms of this Agreement.
- ------------------ ---------------------
Estela Magdalena Raquel Myriam Del Rio
Noceti de Querio Fasciolo
- ------------------------- -----------------------
Vicenta Viccar de Bruzzon Elisabeth Maria Soneyra<PAGE>
<PAGE>
APPENDIX A
DEFINITIONS
Capitalized terms used in this Agreement shall have the meanings
ascribed to them in this Appendix A unless such terms are defined
elsewhere in this Agreement:
AGENT: Perez Companc S.A., acting on its own behalf and as agent
and attorney-in-fact for the other Sellers.
ALLIANCE AGREEMENTS: The agreements to be executed and delivered
at the Closing having the terms and being in the forms of
Exhibits B and C to this Agreement.
BEST EFFORTS: A party's best efforts in accordance with
reasonable commercial practices and without incurring of
unreasonable expense.
CLOSING: The closing of the transactions contemplated by this
Agreement.
CLOSING DATE: April 30, 1996 or such other date as agreed by the
parties.
CONTAMINANT: Any waste, pollutant, hazardous substance, toxic
substance, hazardous waste, special waste, petroleum-based
substance or waste, product or by-product or any constituent of
any said substance, waste or product, whether solid, liquid or
gaseous in form.
DECEMBER 31 BALANCE SHEETS: The unaudited balance sheets of the
Company and of the Subsidiary (or either of them as the context
indicates) as of December 31, 1995 included in the financial
statements referred to in Section 3.06 of this Agreement.
DIVESTEE COMPANIES: Pakingplast S.A., an Argentine corporation;
Jojoba, an Argentine corporation; and Petroquimica Cuyo S.A.I.C,
an Argentine corporation, the interest of the Company in each of
which shall b disposed of prior to the Closing as described in
SCHEDULE 3.13 to this Agreement.
LABOR INDEMNITIES: All of the amounts, vested or contingent,
accrued or due and payable and unpaid, which may be owed by the
Company or its Subsidiary to any employee or officer for
termination indemnities, matured and fractional vacation pay,
legal profit-sharing, and any other monetary benefits pursuant to
the Argentine Labor Law and Regulations, the Venezuelan Petroleum
Industry Collective Labor Contract and/or any collective or
individual labor contracts to which the Company or its Subsidiary
may be a party, and all contingent liabilities for this purpose
shall be deemed to be equal to one hundred percent (100%) of the
liability.
PERMITTED ENCUMBRANCES: (i) The claims, liens, security
interest, charges, leases, encumbrances, licenses and sublicenses
specifically set forth on SCHEDULE 3.10 hereto, (ii) liens for
current taxes not yet due and payable or being contested in good
faith by appropriate proceedings, and (iii) such imperfections of
title, easements, pledges, charges, and encumbrances, if any, as
are inconsequential in amount and do not materially detract from
the value or interfere with the present use of any Rigs or
property of the Company or its Subsidiary or otherwise materially
impair or interfere with the business of the Company and (iv) the
credit facility with First National Bank of Boston described in
Section 5.03.
PURCHASE PRICE: The purchase price for the Shares, which shall be
U.S. $107,400,000 of which U.S. $77,400,000 is payable in cash at
the Closing and the balance is payable in accordance with the
terms of the Purchaser's Note.
PURCHASER INDEMNIFIED LOSS: Any loss, damage or expense
(including reasonable attorney's fees):
(i) in excess of the Threshold Amount and up to an aggregate
amount of U.S. $1,500,000 (One Million Five Hundred Thousand U.S.
Dollars) resulting from any inadvertent or unwillful
inaccuracies in or breach of the covenants, representations and
warranties set forth in Sections 3.01, 3.02, 3.03 exclusive of
the third and fourth sentences of Section 3.03 (a), 3.04, 3.05,
3.06, 3.07, 3.09, 3.11, 3.12, , 3.16, 3.17, 3.19, 3.20, 3.21,
3.22, 3.23, 3.24, 3.25, 3.26, 3.27, and 3.28, if a bona fide
claim for indemnification on any such representations is made
within the following periods counted as from the Closing Date:
(a) one year for those representations contained in Sections
3.01, 3.02, 3.03, 3.04, 3.05, 3.06, 3.09, 3.11, 3.12, 3.16,
(except for environmental insurance which is ruled as set
forth in Section 3.14), 3.17, 3.19, 3.20, 3.21, 3.22, 3.23,
3.24, 3.25, 3.26, 3.27, and 3.28;
(b) six months for those contained in Section 3.07;
PROVIDED HOWEVER, that no such amount will be indemnified while
there is no excess in the Threshold Amount; and/or,
(ii) not subject to an aggregate limit and without deduction of
the Threshold Amount resulting from any inadvertent or unwillful
inaccuracy in or breach of any of the representations and
warranties set forth in the third and fourth sentences of Section
3.03 (a) and Sections 3.08, 3.10, 3.13, 3.15 and 3.18, if a bona
fide claim for indemnification on any such representations is
made within the following periods counted as from the Closing
Date:
(a) two years for those representations contained in Section
3.10 regarding title to real estate;
(b) the relevant period of the statute of limitations for
those representations contained in the third and fourth
sentences of Section 3.03 (a) and Sections 3.08, 3.10
regarding title to Rigs and other assets (except real
estate), 3.13, 3.15 and 3.18, and/or;
(iii) without deduction of the Threshold Amount and up to a limit
of Three Million U.S. Dollars (U.S. $3,000,000) resulting from
any uninsured environmental risk or in excess of any
environmental insurance proceeds received by the Company, if a
bona fide claim for indemnification on the representations
contained in Section 3.14 is made within three years counted as
from the Closing Date, and or;
(iv) not subject to an aggregate limit and without deduction of
the Threshold Amount resulting from (A) failure of the Sellers
to comply with their respective covenant not to compete assumed
in Section IX herein, and (B) any willful inaccuracy or breach of
any of the covenants, representations and warranties of the
Sellers contained in Article III hereof, which, at the time of
Closing or prior to the Closing, was known by any of the Sellers
and/or by any individual being at least a district manager of
the Company or the Subsidiary (or with a similar or superior
position) and was willfully not revealed to or was concealed from
the Purchaser, if a bona fide claim for indemnification on any
such representations is made within the relevant period of the
statute of limitations counted as from the Closing Date.
PURCHASER'S NOTE: The installment promissory note of the
Purchaser in the original principal amount of U.S.$30,000,000
having the terms and being in the form of the promissory note
attached as Exhibit A to this Agreement.
RIGS: All the drilling and workover rigs owned, leased, or used
by the Company and its Subsidiary which are actively marketed and
in good working order.
SELLER AFFILIATE: Any person that directly or indirectly, through
one or more intermediaries, controls, is controlled by or is
under common control with any Seller; PROVIDED, HOWEVER, that the
term "Seller Affiliate" shall not refer to the Company or its
Subsidiary.
SELLER INDEMNIFIED LOSS: Any loss, damage or expense (including
reasonable attorneys' fees) sustained by any of the Sellers
arising out of or resulting from (i) any inaccuracy in or breach
of any of the representations or warranties made by the Purchaser
in this Agreement; or (ii) claims made on any cause occurring
based upon on arising out of the conduct by the Company and its
Subsidiary of their respective business on and after the Closing
Date.
TAXES: All taxes, "tasas", withholdings, social security charges,
contributions, compulsory savings and customs duties, however
denominated, including any assessments, penalties, fines,
interest, surcharges, adjustment for inflation or updating, that
may become payable in respect thereof, imposed by any federal,
provincial, or municipal government or any agency or political
subdivision of any such government (hereinafter collectively,
"Government Agencies"), which are levied or are based on, without
limiting the generality of the foregoing, all income, payroll and
employees' salary and/or withholding, unemployment insurance,
social security contributions, compulsory savings and other
similar contributions, purchases, sale and use, excise, business
activities (including any franchise), gross receipts, occupation,
real and personal property, stamp, transfer, license, net worth,
workers' compensation, customs duties, advertising, weights and
measure, health and hygiene, and shall include payments due to or
imposed by any of the Government Agencies.
THRESHOLD AMOUNT: An amount equal to 5% of the Company's net
worth, after disposal of the Divestee Companies.<PAGE>
<PAGE>
EXHIBIT A
PROMISSORY NOTE
U.S. $30,000,000
April 30, 1996
FOR VALUE RECEIVED, PRIDE PETROLEUM SERVICES, INC., a Louisiana
corporation ("Maker") promises to pay to PEREZ COMPANC S.A., an
Argentine corporation acting in its own behalf and as agent for
the other Sellers (in such capacity, "Payee"), the principal sum
of Thirty Million Dollars (US$30,000,000) in lawful money of the
United States of America.
1. DEFINITIONS
"Business Day" shall mean each day when the Maker, the Payee and
CITIBANK New York, are open for business.
"Clawback Account" means, as of any determination date, the
amount by which the aggregate of all prior Excess Billings
exceeds the aggregate amount of all prior Clawback Payments.
"Clawback Payment" shall mean, as to any principal installment
date, an amount equal to the lesser of (i) the amount by which
$1,000,000 exceeds 30% of Monthly Billings for the month ending
and (ii) the positive balance, if any, in the Clawback Account.
"Events of Default" shall mean (a) the failure of Maker to pay
any installment of principal or interest hereunder when due or
(b) the failure of the Pride Affiliated Companies to perform any
of their respective obligations under the Service Alliance
Agreements, and such failure shall in each case continue thirty
(30) days after Maker has received written notice from Payee
specifying such default.
"Excess Billings" shall mean, as to any monthly period, the
amount by which 30% of the Monthly Billings for such month
exceeds US$1,000,000.
"Highest Lawful Rate" shall mean the maximum nonusurious interest
rate, if any, that at any time or from time to time, may be
contracted for, taken, reserved, charged or received under this
Note under applicable law.
"Monthly Billings" shall mean, as to any monthly period, an
amount equal to all accounts receivable of Maker or the Pride
Affiliated Companies billed during such month by them or any of
them under the Service Alliance Agreements (exclusive of value-
added taxes (V.A.T.) or other similar sales taxes) provided such
account receivable (i) is payable in U.S. Dollars or in the
currency of the country where the services were provided, (ii) is
not subject to set-off counterclaim, defense, allowance or
adjustment, or subject to dispute, objection or complaint by the
account debtor, (iii) the account debtor is not bankrupt or
insolvent or unable to pay its debts as they become due, and (iv)
the account debtor's obligation to pay the account receivable is
unconditional.
"Monthly Installment" shall mean, as to each principal
installment date, an amount equal to the lesser of (i) the sum of
(A) 30% of all Monthly Billings for the preceding month plus (B)
the applicable Clawback Payment, if any, and (ii) US$1,000,000.
For example, if during any month there have been no Monthly
Billings, or for which 30% of the Monthly Billings for such month
would result in an amount less than US$1,000,000 then, to the
extent during any prior months there was an outstanding unpaid
amount which, although being 30% of the Monthly Billing for such
month, exceeded the monthly cap of US$1,000,000, such outstanding
amount will be payable in such unbilled or lower billed month, up
to the cap of US$1,000,000.
"Note Rate" shall mean, as of any determination date, the 90-day
"London Interbank Offered Rate (LIBOR)" quoted in The Wall Street
Journal, Southwest Edition, on such date, or if such date is not
a Business Day, on the following Business Day, plus two percent
(2%) per annum. The Note Rate shall be determined as of the first
day of each calendar quarter, and such rate shall be applicable
during such quarter.
"Post Default Rate" shall mean a rate per annum equal to the
lesser of(i) 3% above the Note Rate otherwise applicable thereto
and (ii) the Highest Lawful Rate.
"Pride Affiliated Companies" shall mean those subsidiaries of
Maker that are listed in Attachment 1 to the Service Alliance
Agreements.
"Sellers" shall mean those parties to the Stock Purchase
Agreement identified as such.
"Service Alliance Agreements" shall mean alliance Agreements of
even date herewith between (a) Perez Companc S.A. and Pride and
(b) Astra C.A.P.S.A. and Pride.
"Stock Purchase Agreement" shall mean that certain Stock Purchase
Agreement for Quitral-Co., S.A.I.C. dated April 30, 1996 among
Pride Petroleum Services, Inc., Perez Companc, S.A., Astra
C.A.P.S.A., Raul Fasciolo, Pedro L. Querio, Juan Carlos Bruzzon
and Alfredo Juan Luis Daverede as amended from time to time.
2. PRINCIPAL INSTALLMENTS
The principal amount of this Note shall be paid in monthly
installments equal to the applicable Monthly Installment,
commencing June 15, 1996, and continuing thereafter on the
fifteenth Business Day of each calendar month immediately
following the calendar month for which Monthly Billings can be
determined until the outstanding principal amount hereof,
together with accrued and unpaid interest, has been repaid in
full.
3. INTEREST
Maker also promises to pay interest on the unpaid principal
amount hereunder at a rate per annum equal to the lesser of (i)
the Note Rate or quarterly on the fifteenth Business Day of each
March, June, September and December commencing June 15, 1996 (ii)
the Highest Lawful Rate; PROVIDED HOWEVER, upon the occurrence
and during the continuance of an Event of Default, the
outstanding unpaid principal amount hereunder and, to the extent
permitted by applicable law, overdue accrued and unpaid interest,
shall bear interest from the date when due until paid in full at
a rate per annum equal at all times to the lesser of (i) the Post
Default Rate and (ii) the Highest Lawful Rate.
For purposes hereof, upon the submission of each Monthly Billing,
the unpaid principal amount hereunder shall be automatically
reduced, and interest shall cease to accrue thereon, by an amount
equal to that portion of the Monthly Installment.
4. EVENTS OF DEFAULT
Notwithstanding the foregoing, this Note shall become immediately
due and payable upon the occurrence of an Event of Default and
receipt by Maker from Payee of a written notice identified as a
"Notice of Event of Default."
5. MISCELLANEOUS
Payments of principal and interest shall be made in lawful money
of the United States of America in immediately available funds to
the account maintained by the Payee at CITIBANK New York, 111
Wall Street, 21 st floor, New York, NY 10043, Account 36968355,
not later than 11:00 a.m.(New York time) on the date on which
such payments shall become due pursuant to the terms and
conditions hereof.
Maker may set off and apply against its obligations hereunder any
indebtedness of the Sellers at any time owing to Maker pursuant
to Section 8.02 of the Stock Purchase Agreement.
Maker may prepay all or any portion of its obligations hereunder
at any time and from time to time, without penalty or premium.
This Note represents the final agreement between the parties and
may not be contradicted by evidence of prior, contemporaneous, or
subsequent oral agreements of the parties.
This Note shall be governed by, and construed in accordance with,
the laws of the State of New York, USA.
This Note shall be subject to Section 11.03(b) of the Stock
Purchase Agreement excluding the second sentence of such section.
IN WITNESS WHEREOF, Maker has caused this Note to be duly
executed and delivered by its officer thereto duly authorized as
of the day and year set forth above.
PRIDE PETROLEUM SERVICES, INC.
By:_________________
Name: Ray H. Tolson
Title: President <PAGE>
<PAGE>
EXHIBIT B
ALLIANCE AGREEMENT
BETWEEN
PEREZ COMPANC S.A.
AND
PRIDE AFFILIATED COMPANIES
DATED APRIL 30, 1996<PAGE>
<PAGE>
EXHIBIT C
ALLIANCE AGREEMENT
BETWEEN
ASTRA C.A.P.S.A.
AND
PRIDE AFFILIATED COMPANIES
DATED APRIL 30, 1996
<PAGE>
