<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
PRIDE INTERNATIONAL, INC.
(Name of Issuer)
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
741541 10 6
(CUSIP Number)
REMI DORVAL
6 RUE DE WATFORD
92000 NANTERRE, FRANCE
331 4776-4262
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
MARCH 10, 1997
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d 1(b)(3) or (4), check the following box: [ ]
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
(Continued on following pages)
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CUSIP NO. 741541 10 6 Page 2 of 63 Pages
- ------------------------------- ------------------------------
SCHEDULE
13D
- -------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Gialos B.V.
- -------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
SC
- -------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
- -------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
The Netherlands
- -------------------------------------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
-----------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
-----------------------------------------------------------------------------------------
EACH
9 SOLE DISPOSITIVE POWER
REPORTING
-----------------------------------------------------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER
WITH 3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- -------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.4% (as of March 10, 1997) (5.8% as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 2 of 63 Pages
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CUSIP NO. 741541 10 6 Page 3 of 63 Pages
- ------------------------------ -------------------------------
SCHEDULE
13D
- -------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Soletanche S.A.
- -------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
SC
- -------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
- -------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
France
- -------------------------------------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
-----------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
EACH -----------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
REPORTING
-----------------------------------------------------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER
WITH 3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,303,300 (as of March 10, 1997) (2,752,750 as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- -------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.4% (as of March 10, 1997) (5.8% as of December 29, 1997)
- -------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 3 of 63 Pages
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ITEM 1. SECURITY AND ISSUER.
This statement relates to the Common Stock, no par value (the
"Shares"), of Pride International, Inc., a Delaware corporation (the "Issuer").
The address of the principal executive office of the Issuer is 5847 San Felipe,
Suite 3000, Houston, Texas 77057.
ITEM 2. IDENTITY AND BACKGROUND.
The persons filing this statement are Gialos B.V., a
Netherlands corporation ("Gialos"), and Soletanche S.A., a French company
("Soletanche"). Gialos and Soletanche are collectively referred to as the
"Reporting Shareholders." The principal business address and the address of
the principal office of Gialos is Amsteldijk 166-I, 1079 LH Amsterdam, and the
principal business address of Soletanche is 6, rue de Watford, 92000 Nanterre,
France.
Gialos is a wholly-owned subsidiary of Soletanche S.A.
Soletanche is a privately-held French company the majority of which is owned by
IGEBE, a privately-held French company. Soletanche's principal business is
civil engineering, specializing in underground works. Gialos has no business
other than the ownership of the Issuer Common Stock.
Schedule A attached hereto sets forth certain additional
information with respect to each director and each executive officer of Gialos
and Soletanche. IGEBE is a Societe en Norn Collectif and, as such, has no
Board of Directors, but is managed by Jean Pierre Lamoure, its sole executive
officer. Mr. Lamoure is also President and Chief Executive Officer of
Soletanche S.A. The filing of this statement on Schedule 13D shall not be
construed as an admission that any person listed on Schedule A hereto is, for
the purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934,
as amended, the beneficial owner of any securities covered by this statement.
Neither Gialos or Soletanche nor, to their knowledge, any
person listed on Schedule A has, during the past five years, (a) been convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (b) been a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or a finding of any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to a Purchase Agreement among the Issuer,
Forasol-Foramer N.V. and the Controlling Shareholders of Forasol-Foramer N.V.
("Forasol") dated as of December 16, 1996, a copy of which is attached hereto
as Exhibit 2, and which is hereby incorporated by reference (the "Agreement"),
providing for, among other things, the purchase of a wholly-owned subsidiary of
Forasol that held substantially all of the assets of Forasol in exchange for
cash and common stock of the Issuer, which was thereafter distributed in a
liquidating distribution to the shareholders of Forasol (the "Business
Combination"), Gialos acquired 3,303,300 shares of Issuer Common Stock.
Page 4 of 63 Pages
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Immediately prior to the closing of the transaction, Gialos owned 30.1% of
Forasol Common Shares, which Common Shares were traded on the Nasdaq National
Market.
The closing of the Business Combination occurred on March 10,
1997.
ITEM 4. PURPOSE OF TRANSACTION.
The Shares are being held by Gialos for investment purposes.
The Reporting Shareholders have no intention of changing management, other than
in the ordinary course of exercising the right held by Gialos to designate one
director of the Issuer as described in Item 6 below. The Reporting
Shareholders do not have any present plans or proposals which relate to or
would result in:
(a) an extraordinary corporate transaction, such as a
merger, reorganization or liquidation, involving the Issuer or any of
its subsidiaries;
(b) a sale or transfer of a material amount of assets of
the Issuer or any of its subsidiaries;
(c) any change in the present Board of Directors or
management of the Issuer, including any plans or proposals to change
the number or term of directors or to fill any existing vacancies on
the Board of Directors, other than as described in Item 6 below;
(d) any material change in the present capitalization or
dividend policy of the Issuer;
(e) any other material change in the Issuer's business or
corporate structure;
(f) changes in the Issuer's charter, bylaws or
instruments corresponding thereto, or other actions which may impede
the acquisition of control of the Issuer by any person;
(g) a class of securities of the Issuer being delisted
from a national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered national
securities association;
(h) a class of equity securities of the Issuer becoming
eligible for termination of registration pursuant to Section 12(g)(4)
of the Securities Exchange Act of 1934, as amended; or
(i) any action similar to any of those enumerated above.
The Reporting Shareholders have no present intention to
acquire any additional Common Stock or other securities of the Issuer. Gialos
may sell all or part of the Issuer Common Stock from time to time in the open
market or in privately negotiated transactions to third parties or otherwise.
Gialos also may from time to time enter into hedging transactions with respect
to the
Page 5 of 63 Pages
<PAGE> 6
shares of Common Stock. As described in Item 6 below, the Reporting
Shareholders received registration rights with respect to the registration of
the Issuer Common Stock under the Securities Act of 1933, as amended, in
connection with the Business Combination.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) As of the close of business on March 10, 1997, the
Reporting Shareholders may be deemed to have beneficially owned in the
aggregate 3,303,300 Shares, representing approximately 8.4% of the Issuer's
outstanding shares. Subsequent to such date, the Issuer has issued shares
pursuant to registered public offerings and certain Shares were sold by Gialos
as described in paragraph (c) below, such that the ownership percentage of the
Reporting Shareholders as of November 1, 1997 was 5.8%.
To the knowledge of the Reporting Shareholders, except as set
forth herein, neither the directors nor the executive officers of the Reporting
Shareholders beneficially own any Shares. Mr. Remi Dorval owns 70,000 Shares
and has options exercisable for 10,000 Shares, one-half of which vest on March
10, 1998 and the remainder of which vest on March 10, 1999. Mr. Dorval is a
director of the Issuer and a director of Soletanche.
(b) Gialos has sole power to vote or to direct the vote
or to dispose or to direct the disposition of the Shares which it directly
beneficially owns.
(c) On June 12, 1997, Gialos sold 550,500 Shares to
Sertofin B.V., a Netherlands corporation ("Sertofin"), in a private transaction
at a price of $15.4545 per share. Sertofin B.V. is a wholly-owned subsidiary
of Ackermans & van Haaren Group, was also a principal shareholder in Forasol,
and received 3,303,300 Shares in the Business Combination.
(d) No other person has the right to receive or the power
to direct the receipt of dividends from, or the proceeds from the sale of, any
Shares which the Reporting Shareholders may be deemed to beneficially own.
For purposes of Section 13(d)(4), Soletanche (by virtue of its
position as sole shareholder of Gialos), IGEBE (as a majority shareholder of
Soletanche) and Jean-Pierre Lamoure (as sole executive officer of IGEBE) may be
deemed to beneficially own the shares which Gialos directly beneficially owns.
Each of Soletanche, IGEBE and Mr. Lamoure disclaims beneficial ownership of
such shares for all other purposes.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
The Reporting Shareholders are parties to a Joint Filing
Agreement, a copy of which is attached hereto as Exhibit 1, with respect to the
filing of this statement and any amendments thereto. Under the terms of the
Agreement executed in connection with the Business Combination, each of
Soletanche and Ackermans & van Haaren Group has the right to nominate a
director to the Board of Directors of the Issuer for a period of five years
from the closing date of the Business
Page 6 of 63 Pages
<PAGE> 7
Combination; provided that Soletanche and Ackermans & van Haaren Group continue
to own 50% or more of the Shares distributed to it in the Business Combination.
The Reporting Shareholders have agreed that so long as the
Board of Directors of the Issuer includes a person designated by the Reporting
Shareholders or their affiliates, and for a period of not less than 90 days
after the Issuer's Board of Directors ceases to include any person so
designated, the Reporting Shareholders and their affiliates will not, either
directly or indirectly, individually or as a member of any group (i)
participate in any unsolicited offer to acquire control of the Issuer or in any
election contest relating to the Issuer; (ii) vote any of the Shares in the
election of directors of the Issuer for any person other than the persons
nominated by the Board of Directors of the Issuer (including those nominated
pursuant to the agreement described above); (iii) vote in favor of any business
combination or any other transaction with a third party that has not been
approved by at least a majority of the members of the Issuer's Board of
Directors; (iv) increase their ownership in the Issuer such that together with
certain other persons that were former shareholders in Forasol, they would own
or control more than 20% of the Issuer's outstanding voting securities; or (v)
enter into any discussion, negotiations, arrangements or understandings with
any third party with a view to taking, or advising, aiding, abetting,
soliciting, inducing or encouraging, any action prohibited by any of the
foregoing.
In connection with the Business Combination, the Issuer and the
Reporting Shareholders entered into a Registration Rights Agreement entitling
the Reporting Shareholders to one "demand" registration and up to two
"piggyback" registrations under the Securities Act of 1933, as amended. Any
demand registration must cover at least $25 million worth of Issuer Common
Stock, and any "piggyback" registration must cover at least $5 million worth of
Issuer Common Stock. Such registration rights expire three years following the
closing of the Business Combination.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
The following documents are filed as Exhibits to this Schedule
13D:
Exhibit 1 -- Joint Filing Agreement
Exhibit 2 -- Purchase Agreement
Page 7 of 62 Pages
<PAGE> 8
After reasonable inquiry and to the best knowledge and belief of each
of the undersigned, each of the undersigned certify that the information set
forth in this statement is true, complete and correct.
Date: December 29, 1997 GIALOS B.V.
By /s/ YVES BENOIT
-------------------------------------
Yves Benoit
Managing Director
Date: December 29, 1997 SOLETANCHE S.A.
By /s/ JEAN-PIERRE LAMOURE
-------------------------------------
Jean-Pierre Lamoure
President
Page 8 of 63 Pages
<PAGE> 9
SCHEDULE A
DIRECTORS AND EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
GIALOS B.V.
----------------------------------------------------------
NAME TITLE
---- -----
<S> <C>
Yves Benoit . . . . . . . . . . . . . . .Managing Director
M.F. Elias . . . . . . . . . . . . . . .Managing Director
</TABLE>
<TABLE>
<CAPTION>
SOLETANCHE S.A.
-------------------------------------------------------
NAME TITLE
---- -----
<S> <C>
Jean-Pierre Lamoure . . . . . . . . . . .President
Remi Dorval . . . . . . . . . . . . . . .Administrateur
Raphael Aris . . . . . . . . . . . . . .Administrateur
Pierre-Louis Francois . . . . . . . . . .Administrateur
Marc Giron . . . . . . . . . . . . . . .Administrateur
Jean-Louis Brault . . . . . . . . . . . .Administrateur
Jerome Tolot . . . . . . . . . . . . . .Administrateur
Francois Chenevier . . . . . . . . . . .Administrateur
</TABLE>
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
1 Joint Filing Agreement
2 Purchase Agreement
</TABLE>
<PAGE> 1
EXHIBIT 1
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the persons named below agree to the joint filing on behalf
of each of them of a statement on Schedule 13D (including amendments thereto)
with respect to the common stock, no par value, of Pride International, Inc.
and further agree that this Joint Filing Agreement be included as an Exhibit to
such joint filings. In evidence thereof, the undersigned, being duly
authorized, have executed this Joint Filing Agreement this 29th day of
December, 1997.
GIALOS B.V.
By /s/ YVES BENOIT
-------------------------------------
Yves Benoit
Managing Director
SOLETANCHE S.A.
By /s/ JEAN-PIERRE LAMOURE
-------------------------------------
Jean-Pierre Lamoure
President
<PAGE> 1
EXHIBIT 2
PURCHASE AGREEMENT
AMONG
PRIDE PETROLEUM SERVICES, INC.,
FORASOL-FORAMER N.V.
AND
THE CONTROLLING SHAREHOLDERS OF FORASOL-FORAMER N.V.
DATED AS OF DECEMBER 16, 1996
<PAGE> 2
TABLE OF CONTENTS
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Page
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ARTICLE I
PURCHASE AND SALE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Preliminary Matters; Ownership of the Forasol Companies . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Transfer of Purchased Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 Other Payments by Pride. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.5 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.6 Distribution of the Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF FORASOL-FORAMER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.1 Organization, Standing and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.2 Capital Structures; Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.3 Authority; No Violations; Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.4 SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.5 Information Supplied . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.6 Unaudited Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.7 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.8 No Undisclosed Material Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.9 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.10 Compliance with Applicable Laws; Environmental,
Health and Safety Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.11 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.12 Title to Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.13 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.14 Pension and Benefit Plans; Other Employee Matters . . . . . . . . . . . . . . . . . . . . . . . . 12
2.15 Labor Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.16 Intangible Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.17 Absence of Foreign or Enemy Status; Sensitive Payments . . . . . . . . . . . . . . . . . . . . . 15
2.18 No Material Operations in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.19 Opinion of Financial Advisor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.20 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.21 Contracts and Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.22 Customers and Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.23 Powers of Attorneys and Suretyships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.24 Vote Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.25 Beneficial Ownership of Pride Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.26 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.27 Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.28 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
</TABLE>
-i-
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<TABLE>
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE FORASOL
CONTROLLING SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PRIDE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.1 Organization, Standing and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.2 Capital Structure; Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.3 Authority; No Violations; Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . 19
4.4 SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.5 Information Supplied . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.6 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.7 No Undisclosed Material Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.8 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.9 Compliance with Applicable Laws; Environmental,
Health and Safety Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.10 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.11 Title to Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.12 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.13 Pension and Benefit Plans; Other Employee Matters . . . . . . . . . . . . . . . . . . . . . . . . 23
4.14 Labor Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
4.15 Intangible Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
4.16 Sensitive Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4.17 Opinion of Financial Advisor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4.18 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4.19 Contracts and Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4.20 Customers and Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.21 Powers of Attorneys and Suretyships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.22 Vote Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.23 Beneficial Ownership of Forasol Common Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.24 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.25 Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.26 Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4.27 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
</TABLE>
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<TABLE>
<S> <C>
ARTICLE V
CONDUCT OF BUSINESSES PENDING THE CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5.1 Conduct of Business by Forasol-Foramer and Pride . . . . . . . . . . . . . . . . . . . . . . . . 28
5.2 No Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE VI
ADDITIONAL AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
6.1 S-4 Registration Statement; Special Shareholders' Meetings . . . . . . . . . . . . . . . . . . . 31
6.2 Approval by Forasol Controlling Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.3 Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.4 Legal Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
6.5 Agreements of Others; Registration Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6.6 Authorization for Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6.7 Employee Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6.8 Stock Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
6.9 Composition of Pride Board and Certain Related Agreements . . . . . . . . . . . . . . . . . . . . 35
6.10 Executive Management Committee of Pride; Certain Executive Officers . . . . . . . . . . . . . . . 36
6.11 Executive Office of Forasol S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.12 Use of Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.13 Liquidation and Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.14 Liquidation and Dissolution Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.15 Agreement to Defend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.16 Public Announcements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.17 Other Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.18 Advice of Changes; SEC Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.19 Section 338 Election. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.20 Indemnification by Pride. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
6.21 Maintenance of the F-F Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE VII
CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
7.1 Conditions to Each Party's Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(a) Forasol Shareholder Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(b) Pride Shareholder Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(c) Nasdaq National Market Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(d) Other Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(e) S-4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(f) No Injunctions or Restraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
7.2 Conditions to Obligations of Pride . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
(a) Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
(b) Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
(c) Letters from Rule 145 Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
</TABLE>
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<TABLE>
<S> <C>
7.3 Conditions to Obligations of the Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
(a) Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
(b) Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE VIII
TERMINATION AND AMENDMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.2 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
8.3 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
8.4 Extension; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE IX
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.1 Payment of Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.2 Nonsurvival of Representations and Warranties; Survival of Covenants . . . . . . . . . . . . . . 43
9.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.4 Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
9.5 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.6 Entire Agreement; No Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.8 Arbitration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.9 No Remedy in Certain Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.10 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
9.11 Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
</TABLE>
EXHIBIT A Registration Rights Agreement
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<PAGE> 6
GLOSSARY OF DEFINED TERMS
<TABLE>
<CAPTION>
Defined Term Defined in Section
- ------------ ------------------
<S> <C>
Acquisition Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2(d)
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
AVH Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.9(a)
Cash Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
Cause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8(a)
Change of Control Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8(c)
Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5
Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5
Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.13(j)
Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3
Contaminant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.11
Corporate Transaction Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.1(d)
Designating Shareholder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.9(b)
Distribution Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3
Exchange Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3(c)
F-F Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Forasol Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.14(a)
Forasol Common Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
Forasol Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Forasol-Foramer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Forasol Intangible Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.16
Forasol Interim Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . 2.6
Forasol Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.11
Forasol LTIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2
Forasol Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.10
Forasol Representatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2(a)
Forasol SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
Forasol Controlling Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Forasol S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Forasol Shareholders' Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
Forasol Stock Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8(a)
Forasol Vote Matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3(a)
Forinter Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
GAAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
Governmental Entity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3(c)
Indemnified Party . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.20
Injunction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1 f)
Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2
Material Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.21
Permitted Encumbrances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.12
Pride . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Pride Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.13(a)
</TABLE>
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<TABLE>
<CAPTION>
Defined Term Defined in Section
- ------------ ------------------
<S> <C>
Pride Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
Pride Intangible Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.15
Pride Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.10
Pride Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.9
Pride Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2
Pride SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4
Pride Shareholders' Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
Pride Vote Matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3(a)
Purchased Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1
Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.13(a)
Rule 145 Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5
S-4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
SEC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3(c)
Securities Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Soletanche Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.9
Stock Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3
Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.13
</TABLE>
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<PAGE> 8
PURCHASE AGREEMENT
PURCHASE AGREEMENT, dated as of December 16, 1996 (this
"Agreement"), by and among PRIDE PETROLEUM SERVICES, INC., a Louisiana
corporation ("Pride"); FORASOL-FORAMER N.V., a Dutch public limited liability
company ("Forasol-Foramer"); and THE SHAREHOLDERS OF FORASOL-FORAMER IDENTIFIED
ON THE SIGNATURE PAGE HERETO (collectively, the "Forasol Controlling
Shareholders" and, together with Forasol-Foramer, the "Sellers").
WHEREAS, Forasol-Foramer is a holding company that owns or
controls substantially all of the issued and outstanding shares of capital
stock of Forasol S.A., a French company ("Forasol S.A."), Forinter Limited, a
Jersey, Channel Islands company ("Forinter Ltd."), and International Drilling
Management B.V., a Dutch closed limited liability company (collectively, the
"Forasol Companies");
WHEREAS, the Forasol Companies, directly and through
Subsidiaries (as defined in Section 1.3) and other affiliates, are engaged in
providing drilling, workover and related services to oil and gas companies
worldwide;
WHEREAS, it is Forasol-Foramer's intention to organize a new,
wholly owned subsidiary as a Dutch closed limited liability company (the "F-F
Subsidiary") and to transfer or cause to be transferred to the F-F Subsidiary
all or substantially all of its assets, including without limitation all of its
record and beneficial ownership in the outstanding capital stock of the Forasol
Companies, and to cause the F-F Subsidiary to assume all of its liabilities;
WHEREAS, the Forasol Controlling Shareholders as a group own,
beneficially and of record, approximately 60% of the outstanding Forasol Common
Shares (as defined in Section 1.3);
WHEREAS, Pride desires to purchase the F-F Subsidiary from
Forasol-Foramer after all of the assets of Forasol-Foramer have been
contributed to, and all of the liabilities of Forasol-Foramer have been assumed
by, the F- F Subsidiary and Forasol-Foramer has agreed to sell, and the Forasol
Controlling Shareholders have agreed to cause Forasol-Foramer to sell, the F-F
Subsidiary to Pride upon the terms and subject to the conditions of this
Agreement;
WHEREAS, the Sellers have further agreed that, upon
consummation of the sale of the F-F Subsidiary to Pride, they will promptly
cause Forasol-Foramer to distribute to its shareholders all of the
Consideration (as defined in Section 1.3) paid by Pride for the F-F Subsidiary,
subject to the withholding of any applicable Taxes (as defined in Section
2.13);
WHEREAS, in furtherance of the foregoing, the governing board
of each of the parties to this Agreement has approved this Agreement and the
transactions contemplated hereby; and
WHEREAS, each of the parties to this Agreement desires to make
certain representations, warranties, covenants and agreements in connection
with the transactions provided for herein and also to prescribe various
conditions to such transactions;
<PAGE> 9
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements herein contained, the
parties hereto agree as follows:
ARTICLE 0.1
PURCHASE AND SALE
(i) Preliminary Matters; Ownership of the Forasol
Companies. Each of the Forasol Companies is presently a first-tier, directly
owned Subsidiary of Forasol-Foramer. Prior to the Closing (as defined in
Section 1.5) Forasol-Foramer will restructure the ownership of the Forasol
Companies so that the Forasol Companies will become directly owned by the F-F
Subsidiary. Upon its organization or as soon thereafter as permitted by
applicable law, the F-F Subsidiary shall have the corporate name "Forasub B.V."
At the Closing, Pride will purchase from Forasol- Foramer all of the issued and
outstanding shares of capital stock of the F-F Subsidiary (the "Purchased
Shares"). It is agreed and understood that at the Closing, the F-F Subsidiary
and its Subsidiaries will represent and account for substantially all of the
consolidated financial position, business and operations of Forasol-Foramer.
(ii) Transfer of Purchased Shares. Upon the terms
and subject to the conditions of this Agreement, at the Closing,
Forasol-Foramer will sell and transfer to Pride the Purchased Shares by
executing and delivering such instruments of transfer and by taking such other
actions as counsel to Pride shall reasonably request, against receipt of the
Consideration (as defined in Section 1.3). The Purchased Shares transferred to
Pride shall include all corporate and financial rights pertaining thereto. If
any outstanding shares of capital stock of any of the Forasol Companies are
owned, beneficially or of record, by any person or persons other than the F-F
Subsidiary, then Forasol-Foramer shall, if requested by Pride, use all
reasonable efforts to have such shares transferred to the F-F Subsidiary or to
one or more other persons designated by Pride at no cost or expense to Pride.
(iii) Consideration. Upon the terms and subject to
the conditions of this Agreement, Pride will purchase the Purchased Shares for
(a) an amount in cash (the "Cash Consideration") equal to U.S.$6.80 multiplied
by the number of common shares, NLG .01 par value per share, of Forasol-Foramer
("Forasol Common Shares") issued and outstanding as of the close of business on
the Distribution Record Date (as defined in Section 1.6) and (b) a number of
shares of common stock ("Pride Common Stock"), no par value, of Pride (the
"Stock Consideration") equal to 0.66 multiplied by the number of Forasol Common
Shares issued and outstanding as of the close of business on the Distribution
Record Date. Pride shall deposit or cause to be deposited with a liquidator
duly appointed by Forasol-Foramer (the "Distribution Agent") cash equal to the
total aggregate Cash Consideration and certificates representing the shares of
Pride Common Stock equal to the total aggregate Stock Consideration, which
shall be distributed by the Distribution Agent, subject to the withholding of
any applicable Taxes, pursuant to irrevocable instructions delivered by
Forasol- Foramer at or prior to the Closing. The Cash Consideration and the
Stock Consideration are collectively referred to herein as the "Consideration".
As used in this Agreement, the word "Subsidiary" means, with respect to any
party, any corporation or other organization, whether incorporated or
unincorporated, of which (i) such party or any other Subsidiary of such party
is a general partner or exercises or has the right to exercise control or (ii)
at least a majority of the
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<PAGE> 10
securities or other interests having by their terms ordinary voting power to
vote in the election of the governing board or others performing similar
functions with respect to such corporation or other organization that is,
directly or indirectly, owned or controlled by such party or by any one or more
of its Subsidiaries, or by such party and any one or more of its Subsidiaries.
In the case of Forasol-Foramer, the term "Subsidiary" shall be deemed to
include the Forasol Companies and, as of the Closing, the F-F Subsidiary unless
the context otherwise requires.
(iv) Other Payments by Pride. In addition to the
purchase and sale of the Purchased Shares for the Consideration, at the
Closing, subject to the provisions of Section 6.14, Pride will assume or cause
the F-F Subsidiary to assume the costs and liabilities reasonably and
necessarily incurred by Forasol-Foramer to wind up its affairs and liquidate
itself and otherwise to perform its obligations hereunder. Pride will deliver
or cause to be delivered prior to the adoption of the Forasol Vote Matter such
instruments of assumption pursuant to this Section 1.4 as shall be requested
and approved by counsel to Forasol-Foramer.
(v) Closing. The closing of the purchase and
sale of the Purchased Shares and of the transactions provided for in Section
1.4 (the "Closing") shall take place at 9:00 a.m., local time at the location
of the Closing, on a date to be specified by the parties, which shall be no
later than the fifth business day after satisfaction (or waiver in accordance
with this Agreement) of the latest to occur of the conditions set forth in
Article VII (the "Closing Date"), at the offices of the Distribution Agent and
at such other locations as shall be legally required, unless another date or
place is agreed to in writing by the parties.
(vi) Distribution of the Consideration. As soon
as practicable following the Closing and in any event not later than the close
of business on the fifth business day thereafter, the Sellers will cause the
Distribution Agent to distribute the Consideration to the shareholders of
Forasol-Foramer so that such shareholders, of record as of the close of
business on the date of the Forasol Shareholders' Meeting (as defined in
Section 6.1) or on such later date which is not more than five business days
prior to the Closing Date as Forasol-Foramer shall designate in a notice to its
shareholders provided in accordance with applicable Dutch law and the rules and
regulations of the Nasdaq National Market System (the "Distribution Record
Date"), will receive, subject to the withholding of any applicable Taxes, cash
in the amount of U.S. $6.80 and 0.66 shares of Pride Common Stock for each of
the Forasol Common Shares held by them as of such Distribution Record Date;
provided, however, that no fractional shares of Pride Common Stock shall be so
distributable and Forasol-Foramer shall make, and shall cause the Distribution
Agent to make, such adjustments with respect to any fractional shares of Pride
Common Stock otherwise distributable as it may deem to be fair and equitable
and as otherwise may be required by applicable law or regulations.
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ARTICLE 0.2
REPRESENTATIONS AND WARRANTIES OF FORASOL-FORAMER
Forasol-Foramer represents and warrants to Pride as follows:
(i) Organization, Standing and Power. Each of
Forasol-Foramer and its Subsidiaries, including without limitation the Forasol
Companies and, as of the Closing Date, the F-F Subsidiary, is a corporation,
partnership, joint venture or other business entity duly organized, validly
existing and in good standing (with all required filings and registrations with
relevant authorities having been duly made) under the laws of the jurisdiction
of its incorporation or organization, has all requisite power and authority to
own, lease and operate its properties and other assets and to carry on its
business as now being conducted, and is duly qualified and in good standing to
do business in each jurisdiction in which the business it is conducting, or the
operation, ownership or leasing of its properties and other assets makes such
qualification necessary, except where the failure to be so qualified or in good
standing would not materially and adversely affect the business or financial
condition of Forasol-Foramer and its Subsidiaries on a consolidated basis. All
of the Subsidiaries of Forasol-Foramer are identified on Schedule 2.1, which
also identifies the respective jurisdictions of incorporation or organization
thereof. Except as set forth on Schedule 2.1, Forasol-Foramer does not own or
control, directly or indirectly, any interest in any business entity, and no
part of the assets or business of Forasol-Foramer or any of the Subsidiaries of
Forasol-Foramer is owned or operated by or through any entity other than those
business entities identified on Schedule 2.1. Schedule 2.1 also sets forth an
accurate summary of the principal place or places of business of, and the major
assets held by, each of the Subsidiaries of Forasol-Foramer. Forasol-Foramer
is a holding company that does not conduct any business operations or own or
lease any assets or properties (other than the capital stocks of the Forasol
Companies, cash, receivables and intercompany loans, all of which will be
transferred to the F-F Subsidiary pursuant to Section 1.1) except through the
Forasol Companies and the other Subsidiaries of Forasol-Foramer. All interests
in the Subsidiaries of Forasol-Foramer, other than its interests in the Forasol
Companies, are owned by Forasol-Foramer through the Forasol Companies.
(ii) Capital Structures; Ownership. The
authorized capital stock of Forasol-Foramer consists of 50,000,000 Forasol
Common Shares, of which (a) 16,650,290 are issued and outstanding, (b) 462,000
are reserved for issuance upon exercise of stock options granted pursuant to
Forasol-Foramer's 1996 Long-Term Incentive Plan (the "Forasol LTIP") and (c)
none are held by Forasol-Foramer in its treasury. All outstanding Forasol
Common Shares are validly issued, fully paid and nonassessable and were not
issued in violation of any preemptive rights. On the Closing Date, all
outstanding Purchased Shares will be validly issued, fully paid and
nonassessable, will not have been issued in violation of any preemptive right,
and will be owned by Forasol-Foramer, free and clear of all Liens (as
hereinafter defined). The authorized and outstanding capital stock of each of
the Forasol Companies and the names and addresses of the record owners thereof
are set forth on Schedule 2.2. Except as set forth on Schedule 2.2, all of the
shares of such capital stock outstanding are validly issued, fully paid and
nonassessable, were not issued in violation of any preemptive rights and are
owned by Forasol-Foramer, free and clear of all Liens. All outstanding shares
of the capital stock of the other Subsidiaries of Forasol-Foramer are validly
issued, fully paid and nonassessable, were not issued in violation of any
preemptive rights, and
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<PAGE> 12
except as set forth on Schedule 2.2, are owned by Forasol S.A. or Forinter
Ltd., or a direct or indirect wholly owned Subsidiary of Forasol S.A. or
Forinter Ltd., respectively, free and clear of all Liens. For purposes of this
Agreement, "Liens" shall mean all mortgages, deeds of trust, liens, security
interests, pledges, rights of use, encroachments, claims, rights of first
refusal, options, charges, liabilities, easements, limitations, reservations,
restrictions, rights of usufruct and other encumbrances of any kind. Except as
set forth in this Section 2.2 or on Schedule 2.2, there are outstanding (i) no
shares of capital stock, depositary receipts or other equity securities of
Forasol-Foramer or any Subsidiary of Forasol-Foramer; (ii) no securities of
Forasol-Foramer or any Subsidiary of Forasol-Foramer convertible into or
exchangeable for shares of capital stock, depository receipts or other equity
securities of Forasol- Foramer or any Subsidiary of Forasol-Foramer; and (iii)
no options, warrants, calls, rights (including preemptive rights, rights of
first refusal or other similar rights ), commitments or agreements to which
Forasol-Foramer or any Subsidiary of Forasol-Foramer is a party or by which it
is bound in any case obligating Forasol-Foramer or any Subsidiary of
Forasol-Foramer to issue, deliver, sell, purchase, redeem or acquire, or cause
to be issued, delivered, sold, purchased, redeemed or acquired, any additional
shares of capital stock, depository receipts or any other equity securities of
Forasol-Foramer or of any Subsidiary of Forasol-Foramer, or obligating
Forasol-Foramer or any Subsidiary of Forasol-Foramer to grant, extend or enter
into any such option, warrant, call, right, commitment or agreement. Except as
provided in this Agreement, there are no shareholder agreements, voting trusts
or other agreements or understandings to which any of the Sellers is a party or
by which any of them is bound relating to the voting of any shares of the
capital stock of Forasol-Foramer that will limit in any way (i) the
solicitation of proxies by or on behalf of Forasol-Foramer from, or the casting
of votes by, the shareholders of Forasol-Foramer with respect to the Forasol
Vote Matter (as defined in Section 2.3(a)) or (ii) the validity or
enforceability of the undertakings of the Forasol Controlling Shareholders in
Section 6.2. Except as may imposed by applicable law, there are no
restrictions on the ability of Forasol-Foramer or the Forasol Companies to vote
or cause to be voted the stock of or other interest in any of their respective
Subsidiaries. Schedule 2.2 sets forth the number of Forasol Common Shares
owned of record and beneficially by each of the Forasol Controlling
Shareholders and such shares, in the aggregate, constitute not less than a
majority of the issued and outstanding Forasol Common Shares.
(iii) Authority; No Violations; Consents and
Approvals.
(a) The Boards of Supervisory Directors and the Managing
Director of Forasol-Foramer have unanimously approved this Agreement and the
transactions provided for herein and have declared this Agreement and such
transactions to be in the best interests of the shareholders of
Forasol-Foramer. Forasol-Foramer has all requisite corporate power and
authority to enter into this Agreement and, subject to approval of this
Agreement, the distribution of the Consideration pursuant to Section 1.6 and
the actions to be taken pursuant to Section 6.13 (collectively, the "Forasol
Vote Matter") by the shareholders of Forasol-Foramer in accordance with Dutch
law, to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Forasol-Foramer, subject only to approval of the Forasol Vote
Matter by the shareholders of Forasol-Foramer in accordance with Dutch law.
This Agreement has been duly executed and delivered by Forasol-Foramer and,
subject only to approval of the Forasol Vote Matter by the shareholders of
Forasol-Foramer in accordance with Dutch law, constitutes a valid and
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<PAGE> 13
binding obligation of Forasol-Foramer enforceable in accordance with its terms
(except as may be limited by bankruptcy, insolvency or other laws of general
application affecting the enforcement of rights of creditors). This Agreement
and the transactions provided for herein have been approved by all requisite
corporate action on the part of each of the Forasol Companies and each of the
other Subsidiaries of Forasol-Foramer.
(b) Subject to the rights of Forasol-Foramer's creditors
upon its liquidation and winding up of its affairs, the execution and delivery
of this Agreement does not, and the consummation of the transactions
contemplated hereby and compliance with the provisions hereof will not,
conflict with, or result in any violation of, or default (with or without
notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to the loss of a
material benefit under or prejudice, or result in the creation of any Lien upon
any of the properties or assets of Forasol-Foramer or any of its Subsidiaries
under, any provision of (i) the Articles of Association of Forasol-Foramer or
any provision of the comparable charter or organizational documents of any of
its Subsidiaries, (ii) any loan or credit agreement, note, bond, mortgage,
indenture, lease or other agreement, instrument, permit, concession, franchise
or license applicable to Forasol-Foramer or any of its Subsidiaries or (iii)
assuming the approval of the Forasol Vote Matter by the shareholders of
Forasol-Foramer has been obtained, any judgment, order, decree, statute, law,
ordinance, rule, regulation, official consent, license or permit applicable to
Forasol- Foramer or any of its Subsidiaries or any of their respective
properties or assets. Except as set forth on Schedule 2.3(b), the consummation
of the transactions contemplated hereby will not result in the acceleration or
otherwise require the prepayment of any banking or other indebtedness of
Forasol-Foramer or of any of its Subsidiaries.
(c) No consent, approval, order or authorization of, or
registration, declaration or filing with, or permit from (including any renewal
of or supplement to any of the foregoing) any court, administrative agency or
commission or other governmental authority or instrumentality, domestic or
foreign (a "Governmental Entity"), is required by or with respect to
Forasol-Foramer or any of its Subsidiaries in connection with the execution and
delivery of this Agreement by Forasol-Foramer or the consummation by
Forasol-Foramer of the transactions contemplated hereby, except for the filing
with the Securities and Exchange Commission ("SEC") of such reports under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and such
other compliance with the Exchange Act and the rules and regulations thereunder
and with applicable Dutch and French law as may be required in connection with
this Agreement and the transactions contemplated hereby.
(i) SEC Documents. Forasol-Foramer has delivered
to Pride a true and complete copy of each report, schedule and registration
statement filed by Forasol-Foramer with the SEC since January 1, 1996 (the
"Forasol SEC Documents"), which are all the documents that Forasol-Foramer has
been required to file with the SEC since such date. As of their respective
dates, the Forasol SEC Documents complied in all material respects with the
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
or the Exchange Act, as the case may be, and the rules and regulations of the
SEC thereunder applicable to such Forasol SEC Documents, and none of the
Forasol SEC Documents contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading. The financial statements of Forasol-
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Foramer included in the Forasol SEC Documents complied as to form in all
material respects with the published rules and regulations of the SEC with
respect thereto, were prepared in accordance with generally accepted accounting
principles ("GAAP") in the United States applied on a consistent basis during
the periods involved (except as may be indicated in the notes thereto or, in
the case of the unaudited statements, as permitted by Rule 10-01 of Regulation
S-X of the SEC) and fairly present in accordance with applicable requirements
of GAAP in the United States (subject, in the case of the unaudited statements,
to normal, recurring adjustments, none of which are material) the consolidated
financial position of Forasol-Foramer and its consolidated Subsidiaries as of
their respective dates and the consolidated results of operations and the
consolidated cash flows of Forasol-Foramer and its consolidated Subsidiaries
for the periods presented therein. Except as disclosed in the Forasol SEC
Documents or on Schedule 2.4, there are no material agreements, arrangements or
understandings between Forasol-Foramer and any party who is at the date of this
Agreement an Affiliate (as defined in Rule 405 under the Securities Act) of
Forasol-Foramer.
(ii) Information Supplied. None of the
information supplied or to be supplied by Forasol-Foramer for inclusion or
incorporation by reference in the Registration Statement on Form S-4 to be
filed with the SEC by Pride in connection with the issuance of shares of Pride
Common Stock pursuant to this Agreement (the "S-4") will, at the time the S-4
becomes effective under the Securities Act or at the Closing Date, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading. If at any time prior to the Closing Date any event with respect to
Forasol-Foramer or any of its Subsidiaries, or with respect to other
information supplied by Forasol-Foramer for inclusion in the S-4, shall occur
which is required to be described in an amendment of, or a supplement to, the
S-4 or in the prospectus or proxy statement included therein, such event shall
be so described to Pride in writing for inclusion in such amendment or
supplement to be promptly filed by Pride with the SEC and, as required by law,
disseminated to the shareholders of Forasol-Foramer and to the shareholders of
Pride.
(iii) Unaudited Financial Statements.
Forasol-Foramer has delivered to Pride an unaudited consolidated balance sheet,
and related unaudited consolidated statements of income and cash flows,
together with the notes thereto, of Forasol-Foramer and its consolidated
Subsidiaries as of and for the nine-month period ended September 30, 1996 (the
"Forasol Interim Financial Statements"). The Forasol Interim Financial
Statements have been prepared in accordance with applicable requirements of
GAAP in the United States and fairly present the consolidated financial
condition of Forasol-Foramer and its consolidated Subsidiaries as of such dates
and the consolidated results of operations and cash flows for the periods then
ended, subject to normal year-end audit adjustments and any other adjustments
described therein or in the notes thereto.
(iv) Absence of Certain Changes or Events. Except
as disclosed in, or reflected in the financial statements included in, the
Forasol SEC Documents, the Forasol Interim Financial Statements or on Schedule
2.7, or except as contemplated by this Agreement, since September 30, 1996
there has not been (a) any declaration, setting aside or payment of any
dividend or other distribution (whether in cash, stock or property) with
respect to any of Forasol-Foramer's capital stock; (b) any amendment of any
material term of any outstanding equity security of Forasol-Foramer or any
Subsidiary of Forasol-Foramer; (c) any repurchase, redemption or other
acquisition by Forasol- Foramer or any Subsidiary of Forasol-Foramer of any
outstanding shares of capital stock
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<PAGE> 15
or other equity securities of, or other ownership interests in, Forasol-Foramer
or any Subsidiary of Forasol-Foramer; (d) any material change in any method of
accounting or accounting practice by Forasol-Foramer or any Subsidiary of
Forasol-Foramer; (e) any material change in the business conducted by
Forasol-Foramer or any Subsidiary of Forasol- Foramer or any change in the
financial condition, assets, liabilities, profits or business of
Forasol-Foramer or any Subsidiary of Forasol-Foramer other than changes in the
ordinary course of business; (f) any material damage to or destruction or loss
of any property or assets of Forasol-Foramer or any Subsidiary of
Forasol-Foramer; (g) any borrowing of or agreement to borrow funds by
Forasol-Foramer or a Subsidiary of Forasol-Foramer, or any termination or
amendment of any evidence of indebtedness, contract, agreement, deed, mortgage,
indenture, lease, license or other instrument, commitment or agreement to which
Forasol-Foramer or any Subsidiary of Forasol-Foramer is a party or by which
Forasol- Foramer or any Subsidiary of Forasol-Foramer or any of their
respective properties are bound; (h) any capital expenditures or series of
related capital expenditures by Forasol-Foramer and its Subsidiaries,
individually and as a group, exceeding in the aggregate U.S.$1.0 million; (i)
any other transaction, commitment, dispute, labor trouble, strike or other
event or condition (financial or otherwise) of any character (whether or not in
the ordinary course of business) that are reasonably likely to materially and
adversely affect the business, operations, assets, financial condition or
results of operations of Forasol-Foramer and its Subsidiaries on a consolidated
basis, other than changes affecting the international well servicing and
contract drilling businesses generally; or (j) any material change in the
compensation paid to any director, officer or employee of Forasol-Foramer or
any of its Subsidiaries.
(v) No Undisclosed Material Liabilities. Except
as disclosed in the Forasol SEC Documents, the Forasol Interim Financial
Statements or on Schedule 2.8, there are no liabilities of Forasol-Foramer or
any of its Subsidiaries of any kind whatsoever, whether accrued, contingent,
absolute, determined, determinable or otherwise, that are reasonably likely to
materially and adversely affect the business, operations, assets, financial
condition or results of operations of Forasol-Foramer and its Subsidiaries on a
consolidated basis.
(vi) No Default. Neither Forasol-Foramer nor any
of its Subsidiaries is in default or violation (and no event has occurred that,
with notice or the lapse of time or both, would constitute a default or
violation or otherwise prejudice) of any term, condition or provision of (a)
their respective articles of incorporation or association, bylaws or equivalent
governing documents; (b) any note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which Forasol-Foramer or any of
its Subsidiaries is a party or by which Forasol- Foramer or any of its
Subsidiaries or any of their respective properties or assets may be bound; or
(c) any order, writ, injunction, decree, statute, rule, regulation, official
consent, license or permit applicable to Forasol-Foramer or any of its
Subsidiaries.
(vii) Compliance with Applicable Laws;
Environmental, Health and Safety Matters. Forasol- Foramer and its
Subsidiaries (i) hold all permits, licenses, variances, exemptions, orders,
franchises and approvals of all Governmental Entities known by them to be
necessary for the lawful conduct of their respective businesses (the "Forasol
Permits"), and (ii) are in substantial compliance with the terms of each of the
Forasol Permits. None of the Forasol Permits will be adversely affected or
amended as a result of the consummation of the transactions provided for
herein. Except as set forth on Schedule 2.10, none of the Forasol Permits is
conditional or limited
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in time. The businesses of Forasol-Foramer and its Subsidiaries are being
conducted in substantial compliance with each law, ordinance and regulation of
every Governmental Entity to which they are respectively subject, except where
the failure to be in compliance would not have a material adverse effect on the
business or financial condition of Forasol-Foramer and its Subsidiaries taken
as a whole.. Except as set forth on Schedule 2.10, no investigation or review
by any Governmental Entity with respect to Forasol-Foramer or any of its
Subsidiaries is pending or, to the best knowledge of the Sellers, threatened.
Without limiting the generality of any of the foregoing and except as set forth
on Schedule 2.10, Forasol-Foramer and its Subsidiaries (a) are, and have
continuously been, in compliance with all laws, regulations and ordinances
relating to environmental, health and safety matters (including those relating
to toxic and hazardous waste and the discharge of matter into the air or water)
and (b) have not caused or permitted any Contaminant (as hereinafter defined)
to be placed, held, located, released, generated, treated, stored or disposed
of except for Contaminants stored or disposed of in substantial compliance with
applicable environmental laws as necessary for the conduct of their respective
businesses. Neither Forasol-Foramer nor any of its Subsidiaries has received
any notice or claim that any of such parties 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 any of them. For purposes of
this Agreement, a "Contaminant" is 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.
(viii) Litigation. Except as disclosed in, or
reflected in the financial statements included in, the Forasol SEC Documents,
the Forasol Interim Financial Statements or on Schedule 2.11 and except for
claims arising in the ordinary course of business which are covered by
insurance, there is no suit, action, arbitration, administrative hearing,
petition for bankruptcy (or equivalent) or suspension of payments, or other
proceeding pending or, to the knowledge of the Forasol-Foramer, threatened
against or affecting Forasol-Foramer or any of its Subsidiaries, nor is there
any judgment, decree, injunction, rule or order of any Governmental Entity or
arbitrator outstanding against Forasol-Foramer or any of its Subsidiaries.
(ix) Title to Property. Forasol-Foramer and its
Subsidiaries have good and defensible title to all their properties and assets
reflected on the consolidated balance sheet as of September 30, 1996 included
in the Forasol Interim Financial Statements, free and clear of all Liens except
(a) as disclosed in the Forasol SEC Documents, the notes to the Forasol Interim
Financial Statements or in Schedule 2.12, (b) for sales and dispositions in the
normal course of business since September 30, 1996 and (c) for Permitted
Encumbrances. "Permitted Encumbrances" means (i) Liens for current taxes and
assessments not yet due and payable, including without limitation Liens for
nondelinquent ad valorem taxes and nondelinquent statutory Liens arising other
than by reason of any default on the part of Forasol-Foramer or any of its
Subsidiaries or Pride or any of its Subsidiaries, as the case may be, and (ii)
such Liens on assets and properties that do not materially detract from the
value thereof or interfere with the present use of the property subject
thereto.
(x) Taxes.
(d) Except as set forth on Schedule 2.13(a), each of
Forasol-Foramer, each of its Subsidiaries and any affiliated, combined or
unitary group of which Forasol-Foramer or any of its
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<PAGE> 17
Subsidiaries is or was a member has (i) timely filed all returns, declarations,
reports, estimates, information returns and statements ("Returns") required to
be filed or sent by or with respect to it in respect of any Taxes (as
hereinafter defined); (ii) timely paid all Taxes due and payable, whether or
not shown on any Return (except for audit adjustments not material in the
aggregate or to the extent that liability therefor is reserved for in the
Forasol Interim Financial Statements), for which Forasol-Foramer or any of its
Subsidiaries may be liable; (iii) established reserves that are adequate for
the payment of all Taxes not yet due and payable; and (iv) complied with all
applicable laws, rules and regulations relating to the payment and withholding
of Taxes and timely withheld from employee wages and any other payments subject
to withholding and paid over to the proper authorities all amounts required to
be so withheld and paid over.
(e) Except to the extent being contested in good faith,
all deficiencies asserted as a result of any examination by any applicable
taxing authority have been paid, fully settled or adequately provided for in
the Forasol Interim Financial Statements. Except as set forth on Schedule
2.13(b) or as adequately reserved for in the Forasol Interim Financial
Statements, no Tax audits or other administrative proceedings or court
proceedings are presently pending with regard to any Taxes for which
Forasol-Foramer or any of its Subsidiaries would be liable, and no material
deficiency for any such Taxes has been proposed, asserted or assessed pursuant
to such examination against Forasol-Foramer or any of its Subsidiaries by any
authority with respect to any period. There is no outstanding claim by any
taxing authority in any jurisdiction in which Forasol-Foramer and its
Subsidiaries do not file Returns that Forasol-Foramer or any of its
Subsidiaries is or may be subject to Taxes imposed by that jurisdiction. There
are no Liens on any assets of Forasol-Foramer or any of its Subsidiaries that
arose in connection with any failure or alleged failure to pay any Tax.
(f) Except as disclosed on Schedule 2.13(c), neither
Forasol-Foramer nor any of its Subsidiaries has executed or entered into with
any taxing authority any agreement or other document extending or having the
effect of extending the period for assessments or collection of any Taxes for
which Forasol-Foramer or any of its Subsidiaries would be liable.
(g) Except as set forth in the Forasol SEC Documents or
as disclosed on Schedule 2.13(d), neither Forasol-Foramer nor any of its
Subsidiaries is a party to, is bound by or has any obligation under, any Tax
sharing agreement or similar agreement or arrangement.
(h) Schedule 2.13(e) discloses all Tax elections made or
availed of by Forasol-Foramer and its Subsidiaries which are material to any of
their respective businesses. To the knowledge of Forasol-Foramer, such Tax
elections were properly and timely filed and are valid and subsisting.
(i) Except as disclosed on Schedule 2.13(f), neither
Forasol-Foramer nor any of its Subsidiaries has formed a tax group in France
or, if such a tax group exists, it may be terminated without the imposition of
any Tax on Forasol-Foramer or any of its Subsidiaries.
(j) Except as disclosed on Schedule 2.13(g), neither
Forasol-Foramer nor any of its Subsidiaries enjoys beneficial treatment in
France with respect to Taxes which could be materially and adversely modified
or terminated as a consequence of the change of control that will occur upon
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<PAGE> 18
consummation of the transactions provided for herein or which is subject to
conditions which could be materially and adversely affected by consummation of
the transactions provided for herein.
(k) The most recent precompte returns (Form 2750) filed
by Forasol-Foramer or any of its Subsidiaries, copies of which have been
furnished to Pride, accurately reflect the amount of dividends payable by
Forasol-Foramer or such Subsidiary of Forasol-Foramer without any liability, as
of the date such return was filed, for precompte Taxes.
(l) Except as disclosed on Schedule 2.13(i), consummation
of the transactions provided for or contemplated by this Agreement will not
cause any Tax to become payable by Forasol-Foramer, any of the Forasol
Companies or any other Subsidiary of Forasol-Foramer in any jurisdiction.
(m) Except as disclosed in Schedule 2.13(j), neither
Forasol-Foramer nor any of its Subsidiaries (other than a Subsidiary which is a
corporation created or organized in the United States or under the laws of the
United States or of any state of the United States) (i) has ever been engaged
in the conduct of a trade or business within the United States for U.S. federal
income tax purposes, (ii) has ever been treated as having a permanent
establishment or other office or fixed place of business in the United States
for U.S. federal income tax purposes, (iii) is entitled to receive or has
previously received any income which is treated as effectively connected with
the conduct of a trade or business within the United States within the meaning
of Section 871(b) or Section 882(b)(2) of the Internal Revenue Code of 1986, as
amended (the "Code"), (iv) owns or has ever owned any United States real
property interest within the meaning of Section 897(c)(1) of the Code, or (v)
is or ever has been a controlled foreign corporation within the meaning of
section 957 of the Code, a passive foreign investment company within the
meaning of Section 1296 of the Code, or a foreign personal holding company
within the meaning of Section 552 of the Code.
(n) Forasol-Foramer and each of the Forasol Companies has
such characteristics as to cause it to be classified as an association within
the meaning of Section 7701(a)(3) of the Code. There is no indebtedness or any
other interest in any of the Forasol Companies which Pride will not acquire,
directly or indirectly, as a result of the transactions contemplated by this
Agreement and which Pride would be required to acquire in order to acquire an
amount of stock of each of the Forasol Companies meeting the requirements of
Section 338(d)(3) and Section 1504(a)(2) of the Code.
(o) Forasol-Foramer and its Subsidiaries have adequate
and sufficient records and accounts as required for tax purposes by each of the
respective jurisdictions in which they are organized or conduct their
businesses and none of them has received any formal notice from any
Governmental Entity or taxing authority challenging or questioning the adequacy
or sufficiency of such records or accounts.
For purposes of this Agreement, "Taxes" shall mean any
federal, provincial, state, county, local or foreign taxes, including, without
limitation, all net income, gross income, corporate income, disinvestment,
sales, use, value-added, ad valorem, transfer, gains, profits, excise,
franchise, real and personal property, gross receipts, capital stock,
production, business and occupation, disability, employment, payroll, social
security, fringe benefit, pension, employee severance, license,
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<PAGE> 19
stamp duties, custom and excise duties or withholding taxes imposed by any
Governmental Entity, and includes any interest and penalties (civil or
criminal) on or additions to any such taxes.
(i) Pension and Benefit Plans; Other Employee
Matters.
(p) Forasol-Foramer and its Subsidiaries have made all
material filings with Governmental Entities as required by applicable law with
respect to reports, documents and notices regarding social security, employee
benefit plans, employee pension plans, employee compensation and benefit
arrangements or payroll practices, including, without limitation, severance
pay, sick leave, vacation pay, salary continuation for disability, consulting
or other compensation agreements, retirement, deferred compensation, bonus,
long-term incentive, stock option, stock purchase, hospitalization, medical
insurance, life insurance and scholarship programs, that are maintained by
Forasol-Foramer or any of its Subsidiaries or to which Forasol-Foramer or any
of its Subsidiaries contributed or is obligated to contribute (collectively,
the "Forasol Benefit Plans"), and have furnished such documents as are required
by applicable law to the participants or beneficiaries of the Forasol Benefit
Plans. Schedule 2.14(a) sets forth an accurate description of each of the
Forasol Benefit Plans.
(q) The Forasol Benefit Plans have been funded and
maintained in accordance with their terms and with all provisions of applicable
law and all contributions due and payable by Forasol-Foramer and its
Subsidiaries in respect of the Forasol Benefit Plans have been duly and
punctually paid.
(r) Except as disclosed on Schedule 2.14(c) or as
otherwise expressly provided for in this Agreement, neither the execution and
delivery of this Agreement nor the consummation of the transactions
contemplated hereby will (i) result in any payment becoming due to any employee
or group of employees of Forasol-Foramer or any of its Subsidiaries; (ii)
increase any benefits otherwise payable under any Forasol Benefit Plan; or
(iii) result in the acceleration of the time of payment or vesting of any such
benefits. Except as disclosed on Schedule 2.14(c), there are no severance,
employment or service agreements between Forasol-Foramer or any of its
Subsidiaries and any employee of Forasol-Foramer or such Subsidiary. True and
correct copies of any such severance, employment or service agreements and of
any other documents governing matters disclosed on Schedule 2.14(c) have been
provided to Pride. Neither Forasol-Foramer nor any of its Subsidiaries has
any consulting agreement or arrangement with any person involving actual or
potential compensation in excess of U.S. $10,000 per month or U.S. $100,000 in
the aggregate, except as is terminable upon one month's notice or less.
(s) Except as disclosed on Schedule 2.14(d), no stock or
other security issued by Forasol-Foramer or any of its Subsidiaries forms or
has formed a material part of the assets of any Forasol Benefit Plan.
(t) Except as disclosed on Schedule 2.14(e), (i) the
employment of each employee of Forasol-Foramer and its Subsidiaries may be
terminated at any time at no cost to any of them other than costs imposed by
the Forasol Benefit Plans and by applicable French or other local laws, rules
or regulations, (ii) to the knowledge of Forasol-Foramer, no key officer of
Forasol-Foramer or any of its Subsidiaries and no group of employees of
Forasol-Foramer or any of its Subsidiaries intends
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<PAGE> 20
to terminate his or her employment at, prior or subsequent to the Closing,
whether or not as a result of the transactions contemplated herein, and (iii)
neither Forasol-Foramer nor any of its Subsidiaries has any direct or indirect
liability, accrued, contingent or otherwise, in respect of any severance
obligations.
(u) Schedule 2.14(f) sets forth a true and complete
listing of the name, responsibility, seniority, total annual compensation,
total accrued vacation and other benefits of each person employed by
Forasol-Foramer or any of its Subsidiaries presently receiving compensation
aggregating in excess of U.S. $100,000 per year.
(i) Labor Agreements. Except as disclosed on
Schedule 2.15:
(v) other than as required by applicable law, neither
Forasol-Foramer nor any of its Subsidiaries is a party to any collective
bargaining agreement or other current labor agreement with any labor union or
organization, and there is no current union representation question involving
employees of Forasol-Foramer or any of its Subsidiaries, nor does
Forasol-Foramer know of any activity or proceeding of any labor organization
(or representative thereof) or employee group (or representative thereof) to
organize any such employees;
(w) there is no unfair labor practice charge or grievance
arising out of a collective bargaining agreement or other grievance procedure
against Forasol-Foramer or any of its Subsidiaries pending or, to the knowledge
of Forasol-Foramer, threatened;
(x) there is no complaint, lawsuit or proceeding in any
forum by or on behalf of any present or former employee, any applicant for
employment or any classes of the foregoing or any Governmental Entity alleging
breach of any express or implied contract of employment, any law or regulation
governing employment or the termination thereof or other discriminatory,
wrongful or tortious conduct in connection with the employment relationship
against Forasol- Foramer or any of its Subsidiaries pending or, to the
knowledge of Forasol-Foramer, threatened;
(y) there is no strike, dispute, slowdown, work stoppage
or lockout pending or, to the knowledge of Forasol-Foramer, threatened against
or involving Forasol-Foramer or any of its Subsidiaries;
(z) Forasol-Foramer and each of its Subsidiaries are in
substantial compliance with all applicable laws and regulations respecting
employment and employment practices, terms and conditions of employment, wages,
hours of work, occupational safety and health, social security, pension and
unemployment benefits, and salary-related Taxes, in each case with respect to
temporary as well as permanent employees; and
(aa) there is no proceeding, claim, suit, action or
governmental investigation pending or, to the knowledge of Forasol-Foramer,
threatened in respect to which any current or former director, officer,
employee or agent of Forasol-Foramer or any of its Subsidiaries is or may be
entitled to claim indemnification from Forasol-Foramer or any of its
Subsidiaries pursuant to their respective charters, bylaws or other
organizational documents, any indemnification agreement to which
Forasol-Foramer or any Subsidiary of Forasol-Foramer is a party or applicable
law.
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<PAGE> 21
(i) Intangible Property. Forasol-Foramer and its
Subsidiaries possess or have adequate rights to use all material trademarks,
trade names, patents, service marks, brand marks, brand names, computer
programs, databases, industrial designs, trade secrets and copyrights necessary
for the operation of the businesses of each of Forasol-Foramer and its
Subsidiaries (collectively, the "Forasol Intangible Property"). Except as set
forth on Schedule 2.16, all of the Forasol Intangible Property is owned by
Forasol-Foramer or its Subsidiaries free and clear of any and all Liens or
claims, and neither Forasol-Foramer nor any such Subsidiary has forfeited or
otherwise relinquished any Forasol Intangible Property. To the knowledge of
Forasol-Foramer, the use of the Forasol Intangible Property by Forasol-Foramer
or its Subsidiaries does not conflict with, infringe upon, violate or interfere
with or constitute an appropriation of any right, title, interest or goodwill,
including, without limitation, any intellectual property right, trademark,
trade name, patent, service mark, brand mark, brand name, computer program,
database, industrial design, trade secret, copyright or any pending
application therefor of any other person; there have been no claims made and
neither Forasol-Foramer nor any of its Subsidiaries has received any notice of
any claim or otherwise knows that any of the Forasol Intangible Property is
invalid or conflicts with the asserted rights of any other person or has not
been used or enforced or has been failed to be used or enforced in a manner
that would result in the abandonment, cancellation or unenforceability of any
of the Forasol Intangible Property.
(ii) Absence of Foreign or Enemy Status; Sensitive
Payments. Neither Forasol-Foramer nor any of its Subsidiaries is a "national"
of a "designated foreign country" within the definitions in the Foreign, Cuban
or Iranian Assets Control Regulations of the United States Department of
Treasury or rulings issued thereunder. The respective businesses of
Forasol-Foramer and its Subsidiaries and the results of their respective
operations are not dependent upon any practice or custom in any jurisdiction
that, if engaged in or observed by Pride and its Subsidiaries, would constitute
a violation of the U.S. Foreign Corrupt Practices Act or the laws of any
jurisdiction governing the use of corporate funds for contributions, gifts,
entertainment or other expenses related to political activity.
(iii) No Material Operations in the United States.
Forasol-Foramer and its Subsidiaries as a group do not have operations or
assets in the United States that would cause this Agreement or any of the
transactions provided for herein to be or become subject to any filing under
the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976.
(iv) Opinion of Financial Advisor.
Forasol-Foramer has received the opinion of Jefferies & Company, Inc. (a copy
of which has been delivered to Pride) to the effect that, as of the date on
which the Board of Supervisory Directors of Forasol-Foramer approved this
Agreement, the Consideration to be received by the holders of Forasol Common
Shares pursuant to this Agreement is fair from a financial point of view to
such holders.
(v) Books and Records. The books, minute books,
records and accounts of Forasol-Foramer and its Subsidiaries are complete and
correct in all material respects and accurately and fairly reflect the
transactions to which each of Forasol-Foramer and its Subsidiaries is or has
been a party.
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<PAGE> 22
(vi) Contracts and Commitments. Schedule 2.21
sets forth a complete and accurate description of all Material Contracts (as
hereinafter defined) to which Forasol-Foramer and each of its Subsidiaries is a
party. For purposes of this Agreement, a "Material Contract" is (i) any
contract or agreement relating to providing or acquiring property (including
intangible property), goods or services or the borrowing or lending of money
that is reasonably expected to involve payments or receipts of U.S.$1.0 million
or more; (ii) any contract or agreement purporting to create a partnership,
joint venture or other business affiliation with an unrelated third party;
(iii) any lease of real or personal property that is reasonably expected to
involve payments or receipts of U.S.$250,000 during any twelve-month period;
(iv) any sales representative, foreign agent's agency or distribution
agreement; (v) any technical services agreement, management contract or similar
agreement having a term exceeding twelve months; and (vi) any contract or
agreement with any of the Forasol Controlling Shareholders. All of the
Material Contracts described on Schedule 2.21 are valid, binding and in full
force and effect, have not been amended or supplemented in any material
respect, and upon consummation of the transactions provided for herein, will be
enforceable by the Forasol Companies and their Subsidiaries in accordance with
their respective terms. To the knowledge of Forasol-Foramer, no party to any
of the Material Contracts described on Schedule 2.21 has defaulted in the
performance of its obligations thereunder, and no events have occurred that
with the lapse of time or action or inaction by any party thereto will result
in any violations or terminations thereof or any defaults thereunder. Except
as described on Schedule 2.21, Forasol-Foramer and its Subsidiaries are not
subject to any contract, agreement or arrangement, written or oral, (i) that
restricts the business operations of Forasol-Foramer or any of its Subsidiaries
geographically or territorially, (ii) with any competitor of Forasol-Foramer or
any of its Subsidiaries or, to the knowledge of Forasol-Foramer, any competitor
of Pride or any of its Subsidiaries, (iii) that is not related to the normal
business operations of Forasol-Foramer and its Subsidiaries, (iv) the
termination of which is subject to the payment of a penalty or indemnity
exceeding U.S. $100,000 or more than 30 days' prior notice, (v) that is subject
to cancellation or termination upon consummation of the transactions provided
for herein, (vi) which imposes or purports to impose upon Forasol-Foramer or
any of its Subsidiaries joint and several liability with unaffiliated third
parties, or (vii) that to the knowledge of Forasol- Foramer, conflicts with or
may conflict with any applicable laws or regulations.
(vii) Customers and Suppliers. Since September 30,
1996, there has not been any adverse change in the relationship or course of
dealing between Forasol-Foramer or any of its Subsidiaries, on the one hand,
and any of their respective suppliers or customers, on the other hand; and
Forasol-Foramer has no reason to believe that (a) any supplier supplying
products, materials or services to Forasol-Foramer or any of its Subsidiaries
intends to cease selling such products, materials or services to any of
Forasol-Foramer and its Subsidiaries or to limit or reduce such sales to any of
Forasol-Foramer and its Subsidiaries or materially alter the terms or
conditions of any such sales or (b) any customer of any of Forasol-Foramer and
its Subsidiaries intends to terminate, limit or reduce its business relations
with any of Forasol-Foramer and its Subsidiaries. Except as set forth on
Schedule 2.22, neither Forasol- Foramer, any of its Subsidiaries, any of the
Forasol Controlling Shareholders, nor any of their respective officers or
directors possesses, directly or indirectly, any financial interest in, or is a
director, officer or employee of, any business organization that is a supplier,
customer, lessor, lessee or competitor or potential competitor of Forasol-
Foramer or any of its Subsidiaries. Ownership of less than 2% of a class of
securities of a
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company traded on a recognized securities exchange shall not be deemed to be a
"financial interest" for purposes of this Section 2.22.
(viii) Powers of Attorneys and Suretyships. Except
as disclosed in Schedule 2.23, neither Forasol-Foramer nor any of its
Subsidiaries has outstanding any general or special power of attorney (whether
as grantor or grantee thereof) or any obligation or liability (whether actual,
accrued, accruing, contingent or otherwise) as guarantor, surety, co-signer,
endorser, co-maker, indemnitor or otherwise in respect of the obligation of any
third party.
(ix) Vote Required. The affirmative vote of the
holders of a majority of the outstanding Forasol Common Shares is the only vote
of the holders of any class or series of Forasol-Foramer capital stock
necessary to approve the Forasol Vote Matter.
(x) Beneficial Ownership of Pride Common Stock.
As of the date hereof, neither Forasol- Foramer nor any of its Subsidiaries
"beneficially owns" (as defined in Rule 13d-3 under the Exchange Act) any
outstanding shares of Pride Common Stock or, except as contemplated by this
Agreement, has any option or other right to acquire any shares of Pride Common
Stock.
(xi) Insurance. Schedule 2.26 is a complete and
accurate summary of Forasol-Foramer's and each of its Subsidiaries' insurance
coverages in effect as of the date hereof. Forasol-Foramer and its
Subsidiaries maintain all insurance coverages required by law and all other
insurance coverages reasonably adequate for the operation of their respective
businesses (taking into account the cost and availability of such insurance),
and the transactions contemplated hereby will not adversely affect such
coverage.
(xii) Brokers. Except for the fees and expenses
payable to Jefferies & Company, Inc., as reflected in a written agreement (a
true and correct copy of which has been furnished to Pride), no broker,
investment banker or other person is entitled to any broker's, finder's or
other similar fee or commission in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
any of the Sellers.
(xiii) Disclosure. Pride has been furnished with
complete and correct copies of all agreements, instruments and documents,
together with any amendments or supplements thereto, set forth on, or
underlying a disclosure set forth on, any schedule delivered by the Sellers
pursuant to this Agreement. Each of such schedules provided by the Sellers is
complete and correct.
ARTICLE 0.3
REPRESENTATIONS AND WARRANTIES OF THE FORASOL CONTROLLING SHAREHOLDERS
Each of the Forasol Controlling Shareholders, severally and
not jointly, represents and warrants to Pride that (i) it is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (ii) it is the record and beneficial owner
of the number of Forasol Common Shares set forth opposite its name on Schedule
2.2, (iii) it has all requisite power and authority, and has taken all
necessary corporate action, to authorize, execute and
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<PAGE> 24
deliver this Agreement, (iv) it does not own, either actually or
constructively, within the meaning of Section 304(c) of the Code, any shares of
Pride Common Stock, and (v) and this Agreement has been duly executed and
delivered by such Forasol Controlling Shareholder and constitutes a valid and
binding obligation of such Forasol Controlling Shareholder enforceable against
it in accordance with its terms (except as may be limited by bankruptcy,
insolvency or other laws of general application affecting the enforcement of
rights of creditors).
ARTICLE 0.4
REPRESENTATIONS AND WARRANTIES OF PRIDE
Pride represents and warrants to the Sellers as follows:
(i) Organization, Standing and Power. Each of
Pride and its Subsidiaries is a corporation, partnership, joint venture or
other business entity duly organized, validly existing and in good standing
(with all required filings and registrations with relevant authorities having
been duly made) under the laws of its jurisdiction of incorporation or
organization, has all requisite power and authority to own, lease and operate
its properties and other assets and to carry on its business as now being
conducted and is duly qualified and in good standing to do business in each
jurisdiction in which the business it is conducting, or the operation,
ownership or leasing of its properties and other assets makes such
qualification necessary, except where the failure to be so qualified or in good
standing would not materially and adversely affect the business or financial
condition of Pride and its Subsidiaries on a consolidated basis. The
Subsidiaries of Pride are identified on Schedule 4.1, which also identifies the
respective jurisdictions of incorporation or organization thereof. Except as
set forth on Schedule 4.1, Pride does not own or control, directly or
indirectly, any interest in any business entity, and no part of the assets or
business of Pride or any of its Subsidiaries is owned or operated by or through
any entity other than those business entities identified on Schedule 4.1.
Schedule 4.1 also sets forth an accurate summary of the principal place or
places of business of, and the major assets held by, each of the Subsidiaries
of Pride.
(ii) Capital Structure; Ownership. As of the date
hereof, the authorized capital stock of Pride consists of 40,000,000 shares of
Pride Common Stock and 5,000,000 shares of preferred stock, no par value, of
Pride (the "Pride Preferred Stock"), of which (a) 28,517,656 shares of Pride
Common Stock are issued and outstanding and 9,478,579 shares of Pride Common
Stock are reserved for issuance upon (i) exercise of outstanding stock options
granted pursuant to Pride's Employee Stock Purchase Plan, Long-Term Incentive
Plan and 1993 Directors' Stock Option Plan, (ii) exercise of outstanding
warrants and (iii) conversion of Pride's 6 1/4% Convertible Subordinated
Debentures due 2006; (c) 54,220 shares of Pride Common Stock are held by Pride
in its treasury or by its wholly owned Subsidiaries; and (d) no shares of Pride
Preferred Stock are issued and outstanding. All outstanding shares of Pride
Common Stock are validly issued, fully paid and nonassessable and are not
subject to any preemptive rights. Except as set forth on Schedule 4.2, all
outstanding shares of capital stock of the Subsidiaries of Pride are owned by
Pride or a direct or indirect wholly owned Subsidiary of Pride, free and clear
of all Liens. Except as set forth in this Section 4.2 or on Schedule 4.2,
there are outstanding (i) no shares of capital stock, depository receipts or
other equity securities of Pride; (ii) no securities of Pride or any Subsidiary
of Pride
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<PAGE> 25
convertible into or exchangeable for shares of capital stock, depository
receipts or other equity securities of Pride or any Subsidiary of Pride; and
(iii) no options, warrants, calls, rights (including preemptive rights, rights
of first refusal or other similar rights), commitments or agreements to which
Pride or any Subsidiary of Pride is a party or by which it is bound in any case
obligating Pride or any Subsidiary of Pride to issue, deliver, sell, purchase,
redeem or acquire, or cause to be issued, delivered, sold, purchased, redeemed
or acquired, any additional shares of capital stock, depository receipts or
any other equity securities of Pride or of any Subsidiary of Pride or
obligating Pride or any Subsidiary of Pride to grant, extend or enter into any
such option, warrant, call, right, commitment or agreement. There are no
shareholder agreements, voting trusts or other agreements or understandings to
which Pride is a party or by which it is bound relating to the voting of any
shares of the capital stock of Pride that will limit in any way the
solicitation of proxies by or on behalf of Pride from, or the casting of votes
by, the shareholders of Pride with respect to the Pride Vote Matter (as defined
in Section 4.3(a)). There are no restrictions on the ability of Pride to vote
or cause to be voted the stock of or other interest in any of its Subsidiaries.
(iii) Authority; No Violations; Consents and
Approvals.
(a) The Board of Directors of Pride has approved this
Agreement and the transactions provided for herein with no negative vote, and
has declared this Agreement and such transactions to be in the best interests
of the shareholders of Pride. Pride has all requisite corporate power and
authority to enter into this Agreement and, subject to the authorization of the
shares of Pride Common Stock issuable pursuant to this Agreement and the
transactions contemplated hereby (the "Pride Vote Matter") by the shareholders
of Pride in accordance with Louisiana law, to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary corporate action on the part of Pride, subject only to
approval of the Pride Vote Matter by the shareholders of Pride in accordance
with Louisiana law. This Agreement has been duly executed and delivered by
Pride and, subject only to approval of the Pride Vote Matter by the
shareholders of Pride in accordance with Louisiana law, constitutes a valid and
binding obligation of Pride enforceable in accordance with its terms (except as
may be limited by bankruptcy, insolvency or other laws of general application
affecting the enforcement of rights of creditors).
(b) The execution and delivery of this Agreement does
not, and the consummation of the transactions contemplated hereby and
compliance with the provisions hereof will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to the loss of a material benefit under or prejudice, or
result in the creation of any Lien upon any of the properties or assets of
Pride or any of its Subsidiaries under, any provision of (i) the Restated
Articles of Incorporation or Bylaws of Pride or any provision of the comparable
charter or organizational documents of any of its Subsidiaries, (ii) any loan
or credit agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to Pride or any
of its Subsidiaries or (iii) assuming the approval of the Pride Vote Matter by
the shareholders of Pride has been obtained, any judgment, order, decree,
statute, law, ordinance, rule, regulation, official consent, license or permit
applicable to Pride or any of its Subsidiaries or any of their respective
properties or assets. The consummation of the transactions contemplated hereby
will
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<PAGE> 26
not result in the acceleration or otherwise require the prepayment of any
banking or other indebtedness of Pride or of any of its Subsidiaries.
(c) No consent, approval, order or authorization of, or
registration, declaration or filing with, or permit from (including any renewal
of or supplement to any of the foregoing) any Governmental Entity is required
by or with respect to Pride or any of its Subsidiaries in connection with the
execution and delivery of this Agreement by Pride or the consummation by Pride
of the transactions contemplated hereby, except for the filing with the SEC of
the S- 4 and such reports under the Exchange Act and such other compliance with
the Securities Act and the Exchange Act and the rules and regulations
thereunder as may be required in connection with this Agreement and the
transactions contemplated hereby, and the obtaining from the SEC of such orders
as may be so required.
(i) SEC Documents. Pride has delivered to
Forasol-Foramer a true and complete copy of each report, schedule, registration
statement and definitive proxy statement filed by Pride with the SEC since
January 1, 1996 (the "Pride SEC Documents"), which are all the documents that
Pride has been required to file with the SEC since such date. As of their
respective dates, the Pride SEC Documents complied with the requirements of the
Securities Act or the Exchange Act, as the case may be, and the rules and
regulations of the SEC thereunder applicable to such Pride SEC Documents, and
none of the Pride SEC Documents contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. The financial statements of Pride
included in the Pride SEC Documents, including those constituting a part of
Pride's quarterly report on Form 10-Q for the nine months ended September 30,
1996, complied as to form in all material respects with the published rules and
regulations of the SEC with respect thereto, were prepared in accordance with
GAAP in the United States applied on a consistent basis during the periods
involved (except as may be indicated in the notes thereto or, in the case of
the unaudited statements, as permitted by Rule 10-01 of Regulation S-X of the
SEC) and fairly present in accordance with applicable requirements of GAAP in
the United States (subject, in the case of the unaudited statements, to normal,
recurring adjustments, none of which are material) the consolidated financial
position of Pride and its consolidated Subsidiaries as of their respective
dates and the consolidated results of operations and the consolidated cash
flows of Pride and its consolidated Subsidiaries for the periods presented
therein. Except as disclosed in the Pride SEC Documents, there are no
agreements, arrangements or understandings between Pride and any party who is
at the date of this Agreement an Affiliate of Pride.
(ii) Information Supplied. None of the
information supplied or to be supplied by Pride for inclusion or incorporation
by reference in the S-4 will, at the time the S-4 becomes effective under the
Securities Act or at the Closing Date, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading. If at any time
prior to the Closing Date any event with respect to Pride or any of its
Subsidiaries, or with respect to other information supplied by Pride for
inclusion in the S-4, shall occur which is required to be described in an
amendment of, or a supplement to, the S-4 or in the prospectus or proxy
statement included therein, such event shall be so described, and such
amendment or supplement shall be promptly filed with the SEC and, as
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required by law, disseminated to the shareholders of Pride and to the
shareholders of Forasol-Foramer.
(iii) Absence of Certain Changes or Events. Except
as disclosed in, or reflected in the financial statements included in, the
Pride SEC Documents or on Schedule 4.6, or except as contemplated by this
Agreement, since September 30, 1996 there has not been (a) any declaration,
setting aside or payment of any dividend or other distribution (whether in
cash, stock or property) with respect to any of Pride's capital stock; (b) any
amendment of any material term of any outstanding equity security of Pride or
any Subsidiary of Pride; (c) any repurchase, redemption or other acquisition by
Pride or any Subsidiary of Pride of any outstanding shares of capital stock or
other equity securities of, or other ownership interests in, Pride or any
Subsidiary of Pride; (d) any material change in any method of accounting or
accounting practice by Pride or any Subsidiary of Pride; (e) any material
change in the business conducted by Pride or any Subsidiary of Pride or any
change in the financial condition, assets, liabilities, profits or business of
Pride or any Subsidiary of Pride other than changes in the ordinary course of
business; (f) any material damage to or destruction or loss of any property or
assets of Pride or any Subsidiary of Pride; (g) any borrowing of or agreement
to borrow funds by Pride or a Subsidiary of Pride, or any termination or
amendment of any evidence of indebtedness, contract, agreement, deed, mortgage,
indenture, lease, license or other instrument, commitment or agreement to which
Pride or any Subsidiary of Pride is a party or by which Pride or any Subsidiary
of Pride or any of their respective properties are bound; (h) any capital
expenditures or series of related capital expenditures by Pride and its
Subsidiaries, individually and as a group, exceeding in the aggregate U.S.$1.0
million; (i) any other transaction, commitment, dispute, labor trouble, strike,
or other event or condition (financial or otherwise) of any character (whether
or not in the ordinary course of business) that are reasonably likely to
materially and adversely affect the business, operations, assets, financial
condition or results of operations of Pride and its Subsidiaries on a
consolidated basis, other than changes affecting the international well
servicing and contract drilling businesses generally; or (j) any material
change in the compensation paid to any director, officer or employee of Pride
or any of its Subsidiaries.
(iv) No Undisclosed Material Liabilities. Except
as disclosed in the Pride SEC Documents or on Schedule 4.7, there are no
liabilities of Pride or any of its Subsidiaries of any kind whatsoever, whether
accrued, contingent, absolute, determined, determinable or otherwise, that are
reasonably likely to affect adversely the business, operations, assets,
financial condition or results of operations of Pride and its Subsidiaries on a
consolidated basis.
(v) No Default. Neither Pride nor any of its
Subsidiaries is in default or violation (and no event has occurred that, with
notice or the lapse of time or both, would constitute a default or violation or
otherwise prejudice) of any term, condition or provision of (a) their
respective articles of incorporation or association, bylaws or equivalent
governing documents; (b) any note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which Pride or any of its
Subsidiaries is now a party or by which Pride or any of its Subsidiaries or any
of their respective properties or assets may be bound; or (c) any order, writ,
injunction, decree, statute, rule, regulation, official consent, license or
permit applicable to Pride or any of its Subsidiaries.
(vi) Compliance with Applicable Laws;
Environmental, Health and Safety Matters. Pride and its Subsidiaries (i) hold
all permits, licenses, variances, exemptions, orders,
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franchises and approvals of all Governmental Entities known by them to be
necessary for the lawful conduct of their respective businesses (the "Pride
Permits"), and (ii) are in substantial compliance with the terms of each of the
Pride Permits. None of the Pride Permits will be adversely affected or amended
as a result of the consummation of the transactions provided for herein.
Except as set forth on Schedule 4.9, none of the Pride Permits is conditional
or limited in time. The businesses of Pride and its Subsidiaries are being
conducted in substantial compliance with each law, ordinance and regulation of
every Governmental Entity to which they are respectively subject, except where
the failure to be in compliance would not have a material adverse effect on the
business or financial condition of Pride and its Subsidiaries taken as a whole.
Except as set forth on Schedule 4.9, no investigation or review by any
Governmental Entity with respect to Pride or any of its Subsidiaries is pending
or, to the best knowledge of Pride, threatened. Without limiting the
generality of any of the foregoing and except as set forth on Schedule 4.9,
Pride and its Subsidiaries (a) are, and have continuously been, in compliance
with all laws, regulations and ordinances relating to environmental, health and
safety matters (including those relating to toxic and hazardous waste and the
discharge of matter into the air or water) and (b) have not caused or permitted
any Contaminant to be placed, held, located, released, generated, treated,
stored or disposed of except for Contaminants stored or disposed of in
substantial compliance with applicable environmental laws as necessary for the
conduct of their respective businesses. Neither Pride nor any of its
Subsidiaries has received any notice or claim that any of such parties 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 any
of them.
(vii) Litigation. Except as disclosed in, or
reflected in the financial statements included in, the Pride SEC Documents or
on Schedule 4.10 and except for claims arising in the ordinary course of
business which are covered by insurance, there is no suit, action, arbitration,
administrative hearing, petition for bankruptcy (or equivalent) or suspension
of payments, or other proceeding pending or, to the knowledge of Pride,
threatened against or affecting Pride or any of its Subsidiaries, nor is there
any judgment, decree, injunction, rule or order of any Governmental Entity or
arbitrator outstanding against Pride or any of its Subsidiaries.
(viii) Title to Property. Pride and its
Subsidiaries have good and defensible title to all their properties and assets
reflected on the consolidated balance sheet as of September 30, 1996 included
in the Pride SEC Documents, free and clear of all Liens except (a) as disclosed
in the Pride SEC Documents or in Schedule 4.11, (b) for sales and dispositions
in the normal course of business since September 30, 1996 and (c) for Permitted
Encumbrances.
(ix) Taxes.
(d) Except as set forth on Schedule 4.12(a), each of
Pride, each of its Subsidiaries and any affiliated, combined or unitary group
of which Pride or any of its Subsidiaries is or was a member has (i) timely
filed all Returns required to be filed or sent by or with respect to it in
respect of any Taxes; (ii) timely paid all Taxes due and payable, whether or
not shown on any Return (except for audit adjustments not material in the
aggregate or to the extent that liability therefor is reserved for in the
quarterly report on Form 10-Q for the nine months ended September 30, 1996
included in the Pride SEC Documents), for which Pride or any of its
Subsidiaries may be liable; (iii) established reserves that are adequate for
the payment of all Taxes not yet due and payable and (iv) complied
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with all applicable laws, rules and regulations relating to the payment and
withholding of Taxes and timely withheld from employee wages and any other
payments subject to withholding and paid over to the proper authorities all
amounts required to be so withheld and paid over.
(e) Except to the extent being contested in good faith,
all deficiencies asserted as a result of any examination by any applicable
taxing authority have been paid, fully settled or adequately provided for in
the quarterly report on Form 10-Q for the nine months ended September 30, 1996
included in the Pride SEC Documents. Except as set forth on Schedule 4.12(b)
or as adequately reserved for in the quarterly report on Form 10-Q for the nine
months ended September 30, 1996 included in the Pride SEC Documents, no Tax
audits or other administrative proceedings or court proceedings are presently
pending with regard to any Taxes for which Pride or any of its Subsidiaries
would be liable, and no material deficiency for any such Taxes has been
proposed, asserted or assessed pursuant to such examination against Pride or
any of its Subsidiaries by any authority with respect to any period. There is
no outstanding claim by any taxing authority in any jurisdiction in which Pride
and its Subsidiaries do not file Returns that Pride or any of its Subsidiaries
is or may be subject to Taxes imposed by that jurisdiction. There are no Liens
on any assets of Pride or any of its Subsidiaries that arose in connection with
any failure or alleged failure to pay any Tax.
(f) Except as disclosed on Schedule 4.12(c), neither
Pride nor any of its Subsidiaries has executed or entered into with any taxing
authority any agreement or other document extending or having the effect of
extending the period for assessments or collection of any Taxes for which Pride
or any of its Subsidiaries would be liable.
(g) Except as set forth in the Pride SEC Documents or as
disclosed on Schedule 4.12(d), neither Pride nor any of its Subsidiaries is a
party to, is bound by or has any obligation under any tax sharing agreement or
similar agreement or arrangement.
(i) Pension and Benefit Plans; Other Employee
Matters.
(h) Pride and its Subsidiaries have made all material
filings with Governmental Entities as required by applicable law with respect
to reports, documents and notices regarding social security, employee benefit
plans, employee pension plans, employee compensation and benefit arrangements
or payroll practices, including, without limitation, severance pay, sick leave,
vacation pay, salary continuation for disability, consulting or other
compensation agreements, retirement, deferred compensation, bonus, long-term
incentive, stock option, stock purchase, hospitalization, medical insurance,
life insurance and scholarship programs, that are maintained by Pride or any of
its Subsidiaries or to which Pride or any of its Subsidiaries contributed or is
obligated to contribute (collectively, the "Pride Benefit Plans"), and have
furnished such documents as are required by applicable law to the participants
or beneficiaries of the Pride Benefit Plans. Schedule 4.13(a) sets forth an
accurate description of each of the Pride Benefit Plans.
(i) The Pride Benefit Plans have been funded and
maintained in accordance with their terms and with all provisions of applicable
law and all contributions due and payable by Pride and its Subsidiaries in
respect of the Pride Benefit Plans have been duly and punctually paid.
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(j) Except as disclosed on Schedule 4.13(c), neither the
execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (i) result in any payment becoming due to
any employee or group of employees of Pride or any of its Subsidiaries; (ii)
increase any benefits otherwise payable under any Pride Benefit Plan; or (iii)
result in the acceleration of the time of payment or vesting of any such
benefits. Except as disclosed on Schedule 4.13(c), there are no severance,
employment or service agreements between Pride or any of its Subsidiaries and
any employee of Pride or such Subsidiary. True and correct copies of any such
severance, employment or service agreements and of any other documents
governing matters disclosed on Schedule 4.13(c) have been provided to
Forasol-Foramer. Neither Pride nor any of its Subsidiaries has any consulting
agreement or arrangement with any person involving actual or potential
compensation in excess of U.S. $10,000 per month or U.S. $100,000 in the
aggregate, except as is terminable upon one month's notice or less.
(k) Except as disclosed on Schedule 4.13(d), no stock or
other security issued by Pride or any of its Subsidiaries forms or has formed a
material part of the assets of any Pride Benefit Plan.
(l) Except as disclosed on Schedule 4.13(e), (i) the
employment of each employee of Pride and its Subsidiaries may be terminated at
any time at no cost to any of them other than costs imposed by the Pride
Benefit Plans and by applicable local laws, rules or regulations, (ii) to the
knowledge of Pride, no key officer of Pride or any of its Subsidiaries and no
group of employees of Pride or any of its Subsidiaries intends to terminate his
or her employment at, prior or subsequent to the Closing, whether or not as a
result of the transactions contemplated herein, and (iii) neither Pride nor any
of its Subsidiaries has any direct or indirect liability, accrued, contingent
or otherwise, in respect of any severance obligations.
(m) Schedule 4.13(f) sets forth a true and complete
listing of the names, total annual compensation, total accrued vacation and
other benefits of each person employed by Pride or any of its Subsidiaries
presently receiving compensation aggregating in excess of U.S.$100,000 per
year.
(i) Labor Agreements. Except as disclosed on
Schedule 4.14:
(n) other than as required by applicable law, neither
Pride nor any of its Subsidiaries is a party to any collective bargaining
agreement or other current labor agreement with any labor union or
organization, and there is no current union representation question involving
employees of Pride or any of its Subsidiaries, nor does Pride or any of its
Subsidiaries know of any activity or proceeding of any labor organization (or
representative thereof) or employee group (or representative thereof) to
organize any such employees;
(o) there is no unfair labor practice charge or grievance
arising out of a collective bargaining agreement or other grievance procedure
against Pride or any of its Subsidiaries pending or, to the knowledge of Pride
or any of its Subsidiaries, threatened;
(p) there is no complaint, lawsuit or proceeding in any
forum by or on behalf of any present or former employee, any applicant for
employment or any classes of the foregoing or any
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Governmental Entity alleging breach of any express or implied contract of
employment, any law or regulation governing employment or the termination
thereof or other discriminatory, wrongful or tortious conduct in connection
with the employment relationship against Pride or any of its Subsidiaries
pending or, to the knowledge of Pride or any of its Subsidiaries, threatened;
(q) there is no strike, dispute, slowdown, work stoppage
or lockout pending or, to the knowledge of Pride or any of its Subsidiaries,
threatened against or involving Pride or any of its Subsidiaries;
(r) Pride and each of its Subsidiaries are in substantial
compliance with all applicable laws and regulations respecting employment and
employment practices, terms and conditions of employment, wages, hours of work,
occupational safety and health, social security, pension and unemployment
benefits, and salary-related Taxes, in each case with respect to temporary as
well as permanent employees;; and
(s) there is no proceeding, claim, suit, action or
governmental investigation pending or, to the knowledge of Pride or any of its
Subsidiaries, threatened in respect to which any current or former director,
officer, employee or agent of Pride or any of its Subsidiaries is or may be
entitled to claim indemnification from Pride or any of its Subsidiaries
pursuant to their respective charters, bylaws or other organizational
documents, any indemnification agreement to which Pride or any Subsidiary of
Pride is a party or applicable law.
(i) Intangible Property. Pride and its
Subsidiaries possess or have adequate rights to use all material trademarks,
trade names, patents, service marks, brand marks, brand names, computer
programs, databases, industrial designs, trade secrets and copyrights
necessary for the operation of the businesses of each of Pride and its
Subsidiaries (collectively, the "Pride Intangible Property"). Except as set
forth on Schedule 4.15, all of the Pride Intangible Property is owned by Pride
or its Subsidiaries free and clear of any and all Liens or claims, and neither
Pride nor any such Subsidiary has forfeited or otherwise relinquished any Pride
Intangible Property. To the knowledge of Pride, the use of the Pride
Intangible Property by Pride or its Subsidiaries does not conflict with,
infringe upon, violate or interfere with or constitute an appropriation of any
right, title, interest or goodwill, including, without limitation, any
intellectual property right, trademark, trade name, patent, service mark, brand
mark, brand name, computer program, database, industrial design, trade secret,
copyright or any pending application therefor of any other person; there have
been no claims made and neither Pride nor any of its Subsidiaries has received
any notice of any claim or otherwise knows that any of the Pride Intangible
Property is invalid or conflicts with the asserted rights of any other person
or has not been used or enforced or has been failed to be used or enforced in a
manner that would result in the abandonment, cancellation or unenforceability
of any of the Pride Intangible Property.
(ii) Sensitive Payments. The respective
businesses of Pride and its Subsidiaries and the results of their respective
operations are not dependent upon any practice or custom in any jurisdiction
that constitutes a violation of the U.S. Foreign Corrupt Practices Act or the
laws of any jurisdiction governing the use of corporate funds for
contributions, gifts, entertainment or other expenses related to political
activity.
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(iii) Opinion of Financial Advisor. Pride has
received the opinion of Simmons & Company International (a copy of which has
been delivered to Forasol-Foramer) to the effect that, as of the date on which
the Board of Directors of Pride approved this Agreement, the Consideration for
the Purchased Shares is fair from a financial point of view to Pride's
shareholders.
(iv) Books and Records. The books, minute books,
records and accounts of Pride and its Subsidiaries are complete and correct in
all material respects and accurately and fairly reflect the transactions to
which each of Pride and its Subsidiaries is or has been a party.
(v) Contracts and Commitments. Schedule 4.19
sets forth a complete and accurate description of all Material Contracts to
which Pride and each of its Subsidiaries is a party. All of the Material
Contracts described on Schedule 4.19 are valid, binding and in full force and
effect, have not been amended or supplemented in any material respect, and upon
consummation of the transactions provided for herein, will be enforceable by
Pride and its Subsidiaries in accordance with their respective terms. To the
knowledge of Pride, no party to any of the Material Contracts described on
Schedule 4.19 has defaulted in the performance of its obligations thereunder,
and no events have occurred that with the lapse of time or action or inaction
by any party thereto will result in any violations or terminations thereof or
any defaults thereunder. Except as described on Schedule 4.19, Pride and its
Subsidiaries are not subject to any contract, agreement or arrangement, written
or oral, (i) that restricts the business operations of Pride or any of its
Subsidiaries geographically or territorially, (ii) with any competitor of Pride
or any of its Subsidiaries or, to the knowledge of Pride, any competitor of
Forasol-Foramer or any of its Subsidiaries, (iii) that is not related to the
normal business operations of Pride and its Subsidiaries, (iv) the termination
of which is subject to the payment of a penalty or indemnity exceeding U.S.
$100,000 or more than 30 days' prior notice, (v) that is subject to
cancellation or termination upon consummation of the transactions provided for
herein, (vi) which imposes or purports to impose upon Pride or any of its
Subsidiaries joint and several liability with unaffiliated third parties, or
(vii) to the knowledge of Pride, conflicts with or may conflict with any
applicable laws or regulations.
(vi) Customers and Suppliers. Since September 30,
1996, there has not been any adverse change in the relationship or course of
dealing between Pride or any of its Subsidiaries, on the one hand, and any of
their respective suppliers or customers, on the other hand; and Pride has no
reason to believe that (a) any supplier supplying products, materials or
services to Pride or any of its Subsidiaries intends to cease selling such
products, materials or services to any of Pride and its Subsidiaries or to
limit or reduce such sales to any of Pride and its Subsidiaries or materially
alter the terms or conditions of any such sales or (b) any customer of any of
Pride and its Subsidiaries intends to terminate, limit or reduce its business
relations with any of Pride and its Subsidiaries. Except as set forth on
Schedule 4.20, neither Pride nor any officer or director of Pride or of any of
its Subsidiaries possesses, directly or indirectly, any financial interest in,
or is a director, officer or employee of, any business organization that is a
supplier, customer, lessor, lessee or competitor or potential competitor of
Pride or any of its Subsidiaries. Ownership of less than 2% of a class of
securities of a company traded on a recognized securities exchange shall not be
deemed to be a "financial interest" for purposes of this Section 4.20.
(vii) Powers of Attorneys and Suretyships. Except
as disclosed in Schedule 4.21, neither Pride nor any of its Subsidiaries has
outstanding any general or special power of
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attorney (whether as grantor or grantee thereof) or any obligation or liability
(whether actual, accrued, accruing, contingent or otherwise) as guarantor,
surety, co-signer, endorser, co-maker, indemnitor or otherwise in respect of
the obligation of any third party.
(viii) Vote Required. The affirmative vote of the
holders of a majority of the outstanding shares of Pride Common Stock
represented in person or by proxy and constituting a quorum at a duly called
meeting thereof is the only vote of the holders of any class or series of Pride
capital stock necessary to approve the Pride Vote Matter.
(ix) Beneficial Ownership of Forasol Common
Shares. As of the date hereof, neither Pride nor its Subsidiaries
"beneficially owns" (as defined in Rule 13d-3 under the Exchange Act) any of
the outstanding Forasol Common Shares or, except as contemplated by this
Agreement, has any option or other right to acquire any Forasol Common Shares.
(x) Insurance. Schedule 4.24 is a complete and
accurate summary of Pride's and each of its Subsidiaries' insurance coverages
in effect as of the date hereof. Pride and its Subsidiaries maintain all
insurance coverages required by law and all other insurance coverages
reasonably adequate for the operation of their respective businesses (taking
into account the cost and availability of such insurance), and the transactions
contemplated hereby will not adversely affect such coverage.
(xi) Brokers. No broker, investment banker or
other person is entitled to any broker's, finder's or other similar fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Pride. Simmons & Company
International is entitled to usual and customary fees for the opinion described
in Section 4.17.
(xii) Financing. Pride has sufficient resources,
including commitments from financial institutions, available to it to pay the
aggregate Cash Consideration on the Closing Date.
(xiii) Disclosure. Forasol-Foramer has been
furnished with complete and correct copies of all agreements, instruments and
documents, together with any amendments or supplements thereto, set forth on,
or underlying a disclosure set forth on, any schedule delivered by Pride
pursuant to this Agreement. Each of such schedules provided by Pride is
complete and correct.
ARTICLE 0.5
CONDUCT OF BUSINESSES PENDING THE CLOSING
(i) Conduct of Business by Forasol-Foramer and
Pride. During the period from the date of this Agreement and continuing until
the Closing, each of Pride and Forasol-Foramer and their respective
Subsidiaries shall carry on its businesses in the usual, regular and ordinary
course in substantially the same manner as heretofore conducted and shall use
all reasonable efforts to preserve intact its present business organizations,
keep available the services of its current
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officers and employees, and endeavor to preserve its relationships with
customers, suppliers and others having business dealings with it to the end
that its goodwill and ongoing business shall not be impaired in any material
respect at the Closing. The Sellers agree as to Forasol-Foramer and its
Subsidiaries, and Pride agrees as to itself and its Subsidiaries, that (except
as expressly contemplated or permitted by this Agreement, or except as set
forth in a Schedule hereto specifically identifying the relevant Section hereof
to which such exception relates, or to the extent that the other parties shall
otherwise consent in writing) neither Pride, Forasol-Foramer nor any of their
respective Subsidiaries shall:
(a) declare, set aside, increase or pay any dividend
(including any stock dividends), or declare or make any distribution on, or
directly or indirectly combine, redeem, reclassify, purchase or otherwise
acquire, any shares of its capital stock or authorize the creation or issuance
of, or issue, deliver or sell any additional shares of its capital stock, any
securities or obligations convertible into or exchangeable for its capital
stock, or effect any stock split or reverse stock split or other
recapitalization, except (i) for the declaration and payment of dividends from
a Subsidiary of Forasol-Foramer to Forasol-Foramer or another Subsidiary of
Forasol-Foramer; (ii) for the declaration and payment of dividends from a
Subsidiary of Pride to Pride or another Subsidiary of Pride; (iii) for cash
dividends or distributions paid on or with respect to the capital stock or
partnership interests of a Subsidiary of either Forasol-Foramer or Pride; or
(iv) as required by the terms of its securities outstanding on the date hereof
or as contemplated by its existing employee benefit plans;
(b) amend or propose to amend its articles of
incorporation or association, bylaws or equivalent governing documents, or
adopt or amend any resolution or agreement concerning indemnification of its
directors, officers, employees or agents;
(c) acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial equity interest in or a
substantial portion of the assets of, or by any other manner, any business or
any corporation, partnership, association or other business organization or
division thereof, except such acquisitions whose aggregate purchase price is
not in excess of U.S.$10.0 million;
(d) except as described on Schedule 5.1(d) in the case of
Pride, sell, lease, encumber or otherwise dispose of, or agree to sell, lease
(whether such lease is an operating or capital lease), encumber or otherwise
dispose of, any of its assets, other than in the ordinary course of business
consistent with past practice;
(e) authorize, recommend, propose or announce an
intention to adopt a plan of complete or partial liquidation or dissolution;
(f) make any changes in its accounting methods, except as
required by law, rule, regulation or GAAP;
(g) (i) grant any increases in the compensation of or
stock options to any of its directors, officers or employees, except increases
in the ordinary course of business consistent with past practice; (ii) pay or
agree to pay any pension, retirement allowance or other employee benefit
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<PAGE> 35
not required or contemplated by law or by any of its existing employee benefit
plans as in effect on the date hereof to any such director, officer or
employee, whether past or present; (iii) enter into any new, or amend any
existing, employment or severance or termination agreement with any such
director, officer or key employee; or (iv) become obligated under any new
employee benefit plan that was not in existence or approved by its governing
board prior to or on the date hereof, or amend any such plan or arrangement in
existence on the date hereof if such amendment would have the effect of
materially enhancing any benefits thereunder;
(h) (i) incur any indebtedness for borrowed money (except
for working capital under its existing credit facilities and refinancings of
existing debt that permit prepayment of such debt without penalty) or guarantee
any such indebtedness or issue or sell any debt securities or warrants or
rights to acquire any of its debt securities or guarantee any debt securities
of others; (ii) except in the ordinary course of business, enter into any lease
(whether such lease is an operating or capital lease) or create any Liens on
its property in connection with any indebtedness thereof, except for those
securing purchase money indebtedness; or (iii) commit to any capital
expenditures not provided for in the capital budget, as amended and approved by
such party prior to the date hereof; provided, however, that this Section
5.1(h) shall not prohibit or restrict Pride or any of its Subsidiaries from
taking any such action as it deems appropriate to finance, raise or provide
funds for the payment of the aggregate Cash Consideration provided for herein;
(i) enter into any agreement or arrangement with any of
its Affiliates on terms materially less favorable to it than could be
reasonably expected to have been obtained with an unaffiliated third party on
an arms'- length basis; provided, however, that this Section 5.1(i) shall not
prohibit any agreement or arrangement between Pride and its wholly owned
Subsidiaries or between Forasol-Foramer and its wholly owned Subsidiaries;
(j) modify, amend, terminate, renew or fail to use
reasonable business efforts to renew any material contract or agreement to
which it is a party or waive, release or assign any material rights or claims,
except in the ordinary course of business consistent with past practice; or
(k) take or fail to take any other action that would
reasonably be expected to (i) cause any representation or warranty herein or
any statement in any Schedule hereto to be inaccurate, incomplete or misleading
or (ii) prevent or materially impede, interfere with or delay the consummation
of the transactions contemplated by this Agreement.
(i) No Solicitation.
(l) From and after the date hereof, none of the Sellers
will, nor will such parties authorize or permit any of their respective
officers, directors, employees, agents and other representatives or those of
any of their respective Subsidiaries (collectively, "Forasol Representatives")
to, directly or indirectly, solicit, initiate or encourage (including by way of
providing information) any prospective buyer or the making of any proposal that
constitutes, or may reasonably be expected to lead to, an Acquisition Proposal
(as hereinafter defined) from any person or engage in any discussions or
negotiations with respect thereto or otherwise cooperate with or assist or
participate in, or facilitate, any such proposal; provided, however, that,
notwithstanding any other provision of this Agreement, (i) Forasol-Foramer's
Board of Supervisory Directors may take
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and disclose to Forasol-Foramer's shareholders a position contemplated by Rule
14e-2(a) under the Exchange Act and (ii) following receipt from a third party
(without any solicitation, initiation, encouragement, discussion or
negotiation, directly or indirectly, by or with the Sellers or any Forasol
Representative) of a bona fide Acquisition Proposal that is financially
superior to the Consideration provided for herein (as determined in each case
in good faith by both Forasol-Foramer's Board of Supervisory Directors and the
Forasol Controlling Shareholders after consultation with Forasol-Foramer's
financial advisors and outside counsel), (x) the Sellers may engage in
discussions or negotiations with such third party and may furnish such third
party information concerning Forasol-Foramer and its business, properties and
assets and (y) the Board of Supervisory Directors of Forasol-Foramer may
withdraw, modify or not make its recommendation to the shareholders of
Forasol-Foramer to vote in favor of the Forasol Vote Matter or terminate this
Agreement in accordance with Section 8.1(f), but in each case referred to in
the foregoing clauses (i) and (ii) only to the extent that the Board of
Supervisory Directors of Forasol-Foramer and the Forasol Controlling
Shareholders shall conclude in good faith after consultation with
Forasol-Foramer's financial advisors and outside counsel that such action is
necessary for the Board of Supervisory Directors of Forasol-Foramer to act in a
manner consistent with its fiduciary obligations under applicable law,
notwithstanding (1) a binding commitment to consummate an agreement of the
nature of this Agreement entered into in the proper exercise of their
applicable fiduciary duties and (2) any concessions that may be offered by
Pride.
(m) Prior to taking any action referred to in Section
5.2(a), if the Sellers intend to participate in any such discussions or
negotiations or provide any such information to any such third party, they
shall give reasonable prior notice to Pride of each such action. The Sellers
shall promptly notify Pride of any such requests for information or the receipt
of any Acquisition Proposal, including the identity of the person or group
engaging in such discussions or negotiations, requesting such information or
making such Acquisition Proposal, and the terms and conditions of any
Acquisition Proposal.
(n) Nothing in this Section 5.2 shall permit any of the
Sellers to enter into any agreement with respect to an Acquisition Proposal
during the term of this Agreement.
(o) As used in this Agreement, "Acquisition Proposal"
means any proposal or offer, other than a proposal or offer by Pride or any of
its Affiliates, for, or that could be reasonably expected to lead to an
acquisition, merger, take-over bid, sale of all or substantially all of the
assets of, or sale of shares of the capital stock of, Forasol-Foramer or any of
its Subsidiaries or any similar transactions involving Forasol-Foramer or any
of its Subsidiaries.
ARTICLE 0.6
ADDITIONAL AGREEMENTS
(i) S-4 Registration Statement; Special
Shareholders' Meetings. Pride shall promptly prepare and file with the SEC the
S-4, which shall include a prospectus to be furnished to the shareholders of
Forasol-Foramer and a proxy statement to be furnished to the shareholders of
Pride in connection with the Forasol Shareholders' Meeting (as hereinafter
defined)
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and the Pride Shareholders' Meeting (as hereinafter defined), respectively, in
each case complying with all applicable requirements of the Securities Act and
the Exchange Act. Thereafter, Pride shall use its best efforts to have the S-4
declared effective under the Securities Act and to obtain all necessary state
securities laws or "Blue Sky" permits, approvals and registrations in
connection with the issuance of Pride Common Stock constituting the Stock
Consideration. Forasol-Foramer shall furnish all information concerning
Forasol-Foramer, its Subsidiaries, the Forasol Controlling Shareholders and the
other holders of Forasol Common Shares as may reasonably be requested by Pride
for inclusion in the S-4 and in connection with obtaining such permits,
approvals and registrations. Subject to Section 5.2 in the case of
Forasol-Foramer, when the S-4 is declared effective under the Securities Act,
Forasol-Foramer and Pride each shall call a special meeting of its respective
shareholders (the "Forasol Shareholders' Meeting" and the "Pride Shareholders'
Meeting," respectively) to be held as soon as practicable for the purpose of
voting upon the Forasol Vote Matter in the case of Forasol-Foramer and the
Pride Vote Matter in the case of Pride. Subject to Section 5.2 in the case of
Forasol- Foramer, Forasol-Foramer, the Forasol Controlling Shareholders and
Pride will take all such steps as are required or customary to recommend and
obtain approval and adoption of the Forasol Vote Matter in the case of
Forasol-Foramer and the Pride Vote Matter in the case of Pride by the
shareholders of Forasol-Foramer and Pride, respectively. Forasol- Foramer and
Pride shall coordinate and cooperate with respect to the timing of such
meetings and shall use all reasonable methods to hold such meetings on the same
day. Pride will notify Forasol-Foramer and its counsel promptly of the receipt
of any written or oral communication from the SEC or its staff and of any
request by the SEC or its staff for amendments or supplements to the proxy
statement/prospectus included in the S-4 or for additional information and will
supply Forasol-Foramer with copies of all correspondence between Pride and the
SEC or its staff with respect to such proxy statement/prospectus.
(ii) Approval by Forasol Controlling Shareholders.
Each of the Forasol Controlling Shareholders covenants and agrees that, subject
to termination of this Agreement pursuant to Article VIII prior to the Forasol
Shareholders' Meeting, it will vote all Forasol Common Shares held by it in
favor of the Forasol Vote Matter and, upon Pride's request, will promptly
constitute and appoint an executive officer of Pride or such other person as
may be designated by Pride to act as its agent, proxy and attorney-in-fact to
cause such shares to be voted in favor of the Forasol Vote Matter.
(iii) Access to Information. Upon reasonable
notice, Forasol-Foramer and Pride shall each (and shall cause each of their
respective Subsidiaries to) afford to the officers, employees, accountants,
counsel and other representatives of the other, full access during normal
business hours during the period prior to the Closing Date, to all its
properties, books, contracts, commitments and records and, during such period,
each of Forasol-Foramer and Pride shall (and shall cause each of their
respective Subsidiaries to) furnish promptly to the other (a) a copy of each
report, schedule, registration statement and other document filed or received
by it during such period pursuant to SEC requirements and (b) all other
information concerning its business, properties and personnel as such other
party may reasonably request. The Forasol Controlling Shareholders shall cause
Forasol-Foramer to comply with its obligations pursuant to this Section 6.3.
Each of the parties hereto agrees that it will not, and will cause its
respective representatives not to, use any information obtained pursuant to
this Section 6.3 for any purpose unrelated to the consummation of the
transactions contemplated by this Agreement.
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(iv) Legal Conditions. Each party hereto shall
take all reasonable actions necessary to comply promptly with all legal
requirements that may be imposed on such party with respect to consummation of
all transactions provided for or contemplated by this Agreement (including,
without limitation, furnishing all information in connection with approvals of
or filings with any Governmental Entity) and will promptly cooperate with and
furnish information to each other in connection with any such requirements
imposed upon any of them or any of their Subsidiaries. Each of Forasol-Foramer
and Pride will, and will cause its Subsidiaries to, take all actions necessary
to obtain (and will cooperate with each other in obtaining) any consent,
acquiescence, authorization, order or approval of, or any exemption or
nonopposition by, any Governmental Entity or court required to be obtained or
made by Forasol-Foramer, Pride or any of their Subsidiaries in connection with
the taking of any action contemplated by this Agreement.
(v) Agreements of Others; Registration Rights.
Prior to the Closing Date, Forasol-Foramer shall cause to be prepared and
delivered to Pride a list identifying all persons in addition to the Forasol
Controlling Shareholders who, at the time of the Forasol Shareholders' Meeting,
may be deemed to be "affiliates" of Forasol-Foramer as that term is used in
paragraphs (c) and (d) of Rule 145 under the Securities Act (the "Rule 145
Affiliates"). Each of the Forasol Controlling Shareholders shall, and
Forasol-Foramer shall use its best efforts to cause each person who is
identified as a Rule 145 Affiliate in such list to, deliver to Pride, at or
prior to the Closing Date, a written agreement that such person will not sell,
pledge, transfer or otherwise dispose of any shares of Pride Common Stock
distributed to such person pursuant hereto, except in compliance with Rule 145
or an exemption from the registration requirements of the Securities Act. At
the Closing, Pride and the Forasol Controlling Shareholders shall execute and
deliver a Registration Rights Agreement in the form of Exhibit A hereto.
(vi) Authorization for Listing. Prior to the
Closing Date, Pride shall take all action necessary to cause the shares of
Pride Common Stock to be distributed hereunder and the shares of Pride Common
Stock to be reserved for issuance upon exercise of Forasol Stock Options to be
approved for listing on the Nasdaq National Market, subject to official notice
of issuance.
(vii) Employee Matters. Following the Closing, (i)
those members of the senior management of Forasol S.A. who are employees of
Forasol S.A. and who are not retained in their present or equivalent positions
for at least two years following the Closing Date will be afforded the
severance benefits described on Schedule 6.7, which benefits and arrangements
have been approved by Pride and a majority of the Supervisory Directors of
Forasol-Foramer; and (ii) the management employees of Forasol S.A. and its
Subsidiaries shall be entitled to compensation and benefits that are at least
as favorable as those currently being provided to them by Forasol S.A. and its
Subsidiaries. Such management employees of Forasol S.A. and its Subsidiaries
shall otherwise be entitled to compensation and benefits comparable to those
provided to management employees of Pride and its other Subsidiaries holding
comparable positions at comparable employment locations (giving due regard to
differences in cost of living, competitive conditions and other similar
factors), if and to the extent such compensation and benefits of Pride and its
other Subsidiaries are more favorable than those provided by Forasol S.A. and
its Subsidiaries. All other employees of Forasol-Foramer and its Subsidiaries,
so long as their employment by Pride, the F-F Subsidiary or any of their
respective Subsidiaries continues, shall be entitled to employee benefits
comparable to those that such employees were receiving immediately prior to the
Closing Date. Pride, its
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Subsidiaries and the employee benefit plans maintained by Pride and its
Subsidiaries in which an employee of Forasol-Foramer or any of its
Subsidiaries participates shall recognize each such employee's years of service
and level of seniority with Forasol-Foramer and its Subsidiaries for purposes
of terms of employment and eligibility, vesting and benefit determination under
such employee benefit plans (other than benefit accruals under any defined
benefit pension plan).
(viii) Stock Options.
(a) Forasol-Foramer shall use reasonable commercial
efforts to cause each holder of an outstanding option to purchase Forasol
Common Shares and any stock appreciation rights related thereto that have been
granted pursuant to the Forasol LTIP ("Forasol Stock Option") to agree that as
of the Closing, such Forasol Stock Option shall become an option to purchase
1.1 shares of Pride Common Stock for each of the Forasol Common Shares
purchasable pursuant to such Forasol Stock Option (with the total shares of
Pride Common Stock covered thereby rounded up or down to the nearest whole
share), the exercise price per share shall not change and such option shall be
exercisable as to one-third of the number of shares of Pride Common Stock
covered thereby immediately following the Closing, one-third upon the first
anniversary of the original grant of the Forasol Stock Option and the remaining
one-third upon the second anniversary of the original grant of the Forasol
Stock Option; provided that if the optionee's employment by Pride, the F-F
Subsidiary or any of their respective Subsidiaries is terminated without
"cause", such option shall become fully vested and shall be exercisable in full
for a period of 90 days following the date of such termination. The term
"cause" shall mean (i) gross or continued misconduct or neglect by the employee
in the discharge of his or her duties and responsibilities of employment, (ii)
the employee's conviction of a felony criminal offense or (iii) the employee's
conviction of any other crime or misdemeanor which, in the good faith judgment
of the board of directors or other supervisory board of his or her immediate
employer, may reasonably be expected to adversely affect such employee's
ability to discharge his or her duties and responsibilities of employment..
Each such option shall otherwise be governed by the terms of other options
granted under Pride's Long-Term Incentive Plan. Pride agrees to assume all
such Forasol Stock Options that the holders agree to convert into options to
purchase Pride Common Stock as provided in this Section 6.8(a).
(b) Pride shall take all corporate and other action
necessary to (i) reserve for issuance a sufficient number of shares of Pride
Common Stock for delivery upon exercise of the Forasol Stock Options assumed in
accordance with Section 6.8(a), and (ii) otherwise cause the Forasol Stock
Options to be accorded the same status (including registration under the
Securities Act) as stock options granted under Pride's Long-Term Incentive
Plan.
(c) If the holder of a Forasol Stock Option does not
agree to convert his or her option as provided in Section 6.8(a), then
Forasol-Foramer shall cause said option to be (i) exercised in full prior to
the Closing Date or (ii) surrendered to Forasol-Foramer on or before the
Closing Date in exchange for a cash payment per share subject to the option
equal to the excess, if any, of the Change of Control Value (as such term is
defined in the Forasol LTIP) over the exercise price of such option for each
such share.
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(i) Composition of Pride Board and Certain
Related Agreements.
(d) The Board of Directors of Pride shall take such
action as may be necessary (including the amendment of its Bylaws) to cause the
number of directors comprising the full Board of Directors of Pride immediately
after the Closing Date to be eight persons: (i) six of whom shall be
then-existing directors of Pride, (ii) one of whom shall be designated by
Sertofin B.V. and its Affiliates (collectively, the "AVH Group") and (iii) one
of whom shall be designated by Gialos B.V., Compagnie Financiere de Services
Petroliers S.A. and their Affiliates (collectively, the "Soletanche Group").
Such persons shall serve as directors of Pride until the next annual meeting of
the shareholders of Pride. One of the two persons so designated, as determined
by agreement between the AVH Group and the Soletanche Group, shall be elected
to the office of Vice Chairman of the Board of Directors of Pride. Until the
fifth anniversary of the Closing Date, the AVH Group on the one hand and the
Soletanche Group on the other hand and as determined by agreement between such
parties, shall each be entitled to nominate a director to the Board of
Directors of Pride, provided that the AVH Group on the one hand, and the
Soletanche Group, on the other hand, continue to own, directly or indirectly,
50% or more of the shares of Pride Common Stock distributed to them pursuant to
this Agreement and one of such nominees, if elected and as determined by
agreement between the AVH Group and the Soletanche Group, shall serve as Vice
Chairman of the Board of Directors of Pride. Nothing in this Section 6.9 shall
be construed as restricting Pride from increasing or decreasing the number of
directors comprising its Board of Directors following the Closing Date.
(e) So long as, pursuant to paragraph (a) of this Section
6.9, the Board of Directors of Pride or of any of its successors includes a
person designated by a Forasol Controlling Shareholder or any of its Affiliates
or a Forasol Controlling Shareholder or any of its affiliates has participated
in the designation of such person (any such Forasol Controlling Shareholder and
its Affiliates being hereinafter referred to collectively as a "Designating
Shareholder"), and for a period of not less than 90 days after such Board of
Directors ceases to include any person so designated, such Designating
Shareholder shall not, either directly or indirectly, individually or as a
member of any "group" (within the meaning of Section 13(d)(3) of the Exchange
Act) (i) solicit proxies or consents or become a "participant" in a
"solicitation" (as such terms are defined or used in Regulation 14A under the
Exchange Act) of proxies or consents with respect to securities of Pride or any
of its successors or initiate any shareholder proposal or "election contest"
(as such term is defined or used in Rule 14a-11 of the Exchange Act) with
respect to Pride or any of its successors or, directly or indirectly, act to
encourage or induce others to take any such action; (ii) vote any of the shares
of Pride Common Stock distributed to it pursuant to this Agreement in the
election of directors of Pride or any of its successors for any person other
than the persons nominated by the Board of Directors of Pride, including those
nominated pursuant to paragraph (a) of this Section 6.9; (iii) vote in favor of
any business combination or any other transaction with a third party that has
not been approved by at least a majority of the members of the Board of
Directors of Pride or any of its successors; (iv) acquire, or offer or agree,
attempt, seek or propose to acquire, directly or indirectly, any voting
securities of Pride or any of its successors (or any direct or indirect
beneficial ownership, rights, options, or interests therein) that would cause
such Designating Shareholder or any "group" of which it is a member to own or
control in the aggregate, together with all other Forasol Controlling
Shareholders and their Affiliates, more than 20% of the securities of Pride or
any of its successors having ordinary voting power in the election of
directors; or (v) enter into any discussion,
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negotiations, arrangements or understandings with any third party with a view
to taking, or advising, aiding, abetting, soliciting, inducing or encouraging,
any action prohibited by any of the foregoing.
(f) Each of the Forasol Controlling Shareholders agrees
and understands that effective as of the Closing, any technical services
agreements and any other contracts or arrangements between Forasol-Foramer and
any of its Subsidiaries on the one hand and any of the Forasol Controlling
Shareholders and any of their respective Affiliates on the other hand providing
for payments or compensation in any form by Forasol-Foramer or any of its
Subsidiaries to any of the Forasol Controlling Shareholders or any of their
respective Affiliates shall be terminated and be of no further force or effect,
without any further liability or obligation on the part of any party thereto.
(i) Executive Management Committee of Pride;
Certain Executive Officers. The Board of Directors of Pride shall take such
action as may be necessary to create an Executive Management Committee
effective as of the Closing Date, which committee shall have general
responsibility for strategic planning of Pride's worldwide operations. The
initial members of such committee shall include Gerard Godde, Managing Director
of Forasol S.A., and John O'Leary, Manager--Marketing and Business Development
of Forasol S.A. As of the Closing Date, Mr. Godde shall also be elected Senior
Vice President of Pride and Mr. O'Leary shall be elected Vice President of
Marketing of Pride. Following the Closing Date, Mr. Godde will serve as
President and Chief Operating Officer and Mr. O'Leary will serve as Director of
Marketing for the continuing operations of the assets and business of the
Forasol Companies and their Subsidiaries. Messrs. Godde and O'Leary shall be
entitled to continue to serve in the positions provided for in this Section
6.10 for a period of five years following the Closing Date or until such
earlier time as Mr. Godde on the one hand or Mr. O'Leary on the other hand
shall cease to be employed by Pride or its Affiliates.
(ii) Executive Office of Forasol S.A. After the
Closing Date, the principal office of Forasol S.A., including but not limited
to its technical, engineering and research and development functions, shall
continue to be maintained in France.
(iii) Use of Name. After the Closing Date, each of
the Sellers agrees, as to itself and any of its Subsidiaries or Affiliates,
that neither it nor any of its Subsidiaries or Affiliates will use the names
"Forasol," "Foramer," "Forinter" or any other similar name in connection with
its activities. At or prior to the Closing, the Sellers shall execute and
deliver to Pride all such consents as may be reasonably requested by Pride, and
will otherwise cooperate with Pride, so as to enable the F-F Subsidiary, the
Forasol Companies or any other Subsidiary of Pride to continue to use any of
such names as its corporate name and to do business under any of such names in
any jurisdiction.
(iv) Liquidation and Dissolution. As soon as
practicable following the Closing Date, Forasol-Foramer will take all such
action as may be required to dissolve and terminate its corporate existence and
to wind up its affairs pursuant to all applicable laws.
(v) Liquidation and Dissolution Expenses. At the
Closing, Pride shall provide or cause the F-F Subsidiary or the Forasol
Companies to provide such undertakings and
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disburse such funds as Forasol-Foramer shall reasonably require in furtherance
of Pride's obligations incurred pursuant to Section 1.4; provided that neither
Pride, the F-F Subsidiary nor any of the Forasol Companies shall be under any
obligation to advance any funds or assume any obligations in respect of any
Taxes payable by or on behalf of any shareholder of Forasol-Foramer upon
consummation of the transactions provided for herein.
(vi) Agreement to Defend. If any claim, action,
suit, investigation or other proceeding by any Governmental Entity or other
person or other legal or administrative proceeding is commenced that questions
the validity or legality of the transactions contemplated by this Agreement or
seeks damages in connection therewith, the parties hereto agree to cooperate
and use their reasonable efforts to defend against and respond thereto.
(vii) Public Announcements. Pride and the Sellers
will consult with each other before issuing any press release or otherwise
making any public statements with respect to the transactions contemplated by
this Agreement, and shall not issue any such press release or make any such
public statement prior to such consultation, except as may be required by
applicable law or by obligations pursuant to any listing agreement with any
national securities exchange or transaction reporting system.
(viii) Other Actions. Except as contemplated by
this Agreement, neither Pride nor any of the Sellers shall, and shall not
permit any of their respective Subsidiaries to, take, or agree or commit to
take, any action that is reasonably likely to result in any of its respective
representations or warranties hereunder being untrue in any material respect or
in any of the conditions set forth in Article VII not being satisfied.
(ix) Advice of Changes; SEC Filings. Pride and
the Sellers shall confer on a regular basis with each other, report on
operational matters and promptly advise each other orally and in writing of any
change or event resulting in, or that insofar as can reasonably be foreseen,
could result in, a breach or potential breach of any of their respective
representations, warranties, covenants or agreements set forth herein or in the
inability of any of them to satisfy any of the conditions set forth in Article
VII. Pride and Forasol-Foramer shall promptly provide each other (or their
respective counsel) copies of all filings made by such party with the SEC or
any other Governmental Entity in connection with this Agreement and the
transactions contemplated hereby.
(x) Section 338 Election. The parties to this
Agreement acknowledge that Pride intends to make an election under Section 338
of the Code with respect to the purchase of the F-F Subsidiary and certain of
its Subsidiaries and that the transactions contemplated by this Agreement have
accordingly been designed to constitute a qualified stock purchase within the
meaning of Section 338(d)(3) and (h)(3) of the Code. Accordingly, if the
closing price of the Pride Common Stock on the Nasdaq National Market on the
last business day prior to the Closing Date, as reported in The Wall Street
Journal, is greater than $39 per share, Pride may, at its election, increase
the Cash Consideration, and reduce the Stock Consideration in the same amount,
by such amounts as may be necessary to ensure that such transactions will
qualify as a qualified stock purchase.
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(xi) Indemnification by Pride. Following the
Closing, Pride shall, and shall cause the F-F Subsidiary and its Subsidiaries
to, indemnify defend and hold harmless the present and former directors,
supervisory directors, management board members, officers and employees of
Forasol-Foramer and its Subsidiaries and the Forasol Controlling Shareholders
(each, an "Indemnified Party") against all losses, claims, damages, costs,
expenses, liabilities or judgments or amounts paid in settlement with the
approval of Pride (which approval shall not be unreasonably withheld) arising
out of or in connection with any claim, action, suit, proceeding or
investigation based in whole or in part on or arising in whole or in part out
of the fact that such person is or was a director, officer or employee of
Forasol-Foramer or any of its Subsidiaries, whether pertaining to any matter
existing or occurring at or prior to the Closing Date and whether reasserted or
claimed prior to, or at or after, the Closing Date ("Indemnified Liabilities"),
including without limitation all Indemnified Liabilities based in whole or in
part on, or arising in whole or in part out of, or pertaining to this Agreement
or the transactions contemplated hereby (including, without limitation, the
liquidation of Forasol-Foramer), in each case to the full extent Pride,
Forasol-Foramer or any of its Subsidiaries are permitted to provide
indemnification under the laws of their respective jurisdictions (and Pride
will pay expenses in advance to the final disposition of any such action or
proceeding to each Indemnified Party to the full extent permitted by law). The
defense of any such claim, action, suit, proceeding or investigation shall be
conducted by Pride. If Pride has failed to conduct such defense, the
Indemnified Parties may retain counsel satisfactory to them and Pride shall pay
all reasonable fees and expenses of such counsel for the Indemnified Parties
promptly as statements therefor are received. If Pride is responsible for the
attorney's fees of the Indemnified Parties, then the Indemnified parties as a
group may retain only one law firm to represent them with respect to each such
matter unless there is, under applicable standards of professional conduct, a
conflict on any significant issue between the positions of any two or more
Indemnified Parties. If Pride or any of its successors or assigns shall
consolidate with or merge into any other person and shall not be a continuing
or surviving person of such consolidation or merger or shall transfer all or
substantially all of its assets to any person, then in each case, proper
provision shall be made so that the successors and assigns of Pride shall
assume the obligations set forth in Section 6.20. The provisions of this
Section 6.20 are intended to be for the benefit of, and shall be enforceable
by, the parties hereto and each Indemnified Party, his heirs and his
representatives.
(xii) Maintenance of the F-F Subsidiary. For a
period of not less than two years following the Closing Date, Pride will cause
the F-F Subsidiary to maintain its corporate existence and its ownership of the
Forasol Companies.
ARTICLE 0.7
CONDITIONS PRECEDENT
(i) Conditions to Each Party's Obligations. The
respective obligation of each party to consummate the transactions provided for
herein shall be subject to the satisfaction prior to the Closing Date of the
following conditions:
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(A) Forasol Shareholder Approval. The
Forasol Vote Matter shall have been approved and adopted by the
holders of the outstanding Forasol Common Shares in accordance with
Dutch law and the Articles of Association of Forasol-Foramer.
(B) Pride Shareholder Approval. The
Pride Vote Matter shall have been approved and adopted by the holders
of the outstanding shares of Pride Common Stock in accordance with
Louisiana law and the Restated Articles of Incorporation of Pride.
(C) Nasdaq National Market Listing. The
shares of Pride Common Stock to be distributed to shareholders of
Forasol-Foramer pursuant to this Agreement and reserved for issuance
upon exercise of the Forasol Stock Options shall have been authorized
for listing on the Nasdaq National Market upon official notice of
issuance. Subject to such volume limitations as shall be applicable
to the Forasol Shareholders and Rule 145 Affiliates, such shares shall
be freely tradable on the Nasdaq National Market.
(D) Other Approvals. All consents,
approvals, permits and authorizations required to be obtained prior to
the Closing from any Governmental Entity in connection with the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby shall have been made or obtained (as
the case may be), except where the failure to obtain such consents,
approvals, permits and authorizations would not be reasonably likely
to affect materially and adversely either the ability of any party to
consummate such transactions or the consolidated financial position or
results of operations of Pride thereafter.
(E) S-4. The S-4 shall have become
effective under the Securities Act and shall not be the subject of any
stop order or proceedings seeking a stop order.
(F) No Injunctions or Restraints. No
temporary restraining order, preliminary or permanent injunction or
other order issued by any court of competent jurisdiction or other
legal restraint or prohibition (an "Injunction") preventing the
consummation of the transactions contemplated hereby shall be in
effect; provided, however, that prior to invoking this condition, each
party shall have complied fully with its obligations under Section 6.4
hereof and, in addition, shall use all reasonable efforts to have any
such decree, ruling, injunction or order vacated, except as otherwise
contemplated by this Agreement.
(ii) Conditions to Obligations of Pride. The
obligations of Pride to consummate the transactions provided for herein shall
be subject to the satisfaction prior to the Closing Date of the following
conditions, any or all of which may be waived in whole or in part by Pride:
(A) Representations and Warranties.
Subject to Section 8.1(d), the representations and warranties of the
Sellers set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement and (except to the
extent such representations and warranties speak as of an earlier
date) as of the Closing Date as though made on and as of the Closing
Date, and Pride shall have received a certificate signed on
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behalf of each of the Sellers by the chief executive officer and the
chief financial officer of each of them to such effect. Such
certificate shall identify any inaccuracies in or breaches of the
representations and warranties set forth in Article II or Article III
that are deemed not to be material.
(B) Performance of Obligations. The
Sellers shall have performed in all material respects all obligations
required to be performed by them under this Agreement at or prior to
the Closing Date, and Pride shall have received a certificate signed
on behalf of each of the Sellers by the chief executive officer and
the chief financial officer of each of them to such effect. Such
certificate shall identify any failure of the Sellers to perform their
obligations hereunder that are deemed not to be material.
(C) Letters from Rule 145 Affiliates.
Pride shall have received from the Forasol Controlling Shareholders
and each Rule 145 Affiliate an executed copy of an agreement as
provided in Section 6.5.
(iii) Conditions to Obligations of the Sellers.
The obligations of the Sellers to consummate the transactions provided for
herein shall be subject to the satisfaction prior to the Closing Date of the
following conditions, any or all of which may be waived in whole or in part by
Forasol-Foramer on behalf of all of the Sellers:
(A) Representations and Warranties.
Subject to Section 8.1(e), the representations and warranties of Pride
set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and (except to the extent
such representations and warranties speak as of an earlier date) as of
the Closing Date as though made on and as of the Closing Date, and
Forasol-Foramer shall have received a certificate signed on behalf of
Pride by its chief executive officer and its chief financial officer
to such effect. Such certificate shall identify any inaccuracies in
or breaches of the representations and warranties set forth in Article
IV that are deemed not to be material.
(B) Performance of Obligations. Pride
shall have performed in all material respects all obligations required
to be performed by it under this Agreement at or prior to the Closing
Date, and Forasol-Foramer shall have received a certificate signed on
behalf of Pride by its chief executive officer and its chief financial
officer to such effect. Such certificate shall identify any failure
of Pride to perform its obligations hereunder that are deemed not to
be material.
ARTICLE 0.8
TERMINATION AND AMENDMENT
(i) Termination. This Agreement may be
terminated at any time prior to the Closing Date, whether before or after
approval by the shareholders of Forasol-Foramer and of Pride:
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(a) by mutual written consent of Forasol-Foramer and
Pride, or by mutual action of their respective Boards of Directors;
(b) by either Forasol-Foramer or Pride if (i) any
Governmental Entity shall have issued any Injunction or taken any other action
permanently restraining, enjoining or otherwise prohibiting the consummation of
the transactions provided for herein and such Injunction or other action shall
have become final and nonappealable; or (ii) any required approval of the
shareholders of the other party shall not have been obtained by reason of the
failure to obtain the required vote at a duly held meeting of shareholders or
at any adjournment thereof;
(c) by either Forasol-Foramer or Pride if the
transactions provided for herein shall not have been consummated by April 30,
1997; provided, however, that the right to terminate this Agreement under this
Section 8.1(c) shall not be available to any party whose breach of any
representation or warranty or failure to fulfill any covenant or agreement
under this Agreement has been the cause of or resulted in the failure to
consummate such transactions on or before such date;
(d) by Pride if the conditions to Pride's obligations set
forth in Section 7.2 cannot be satisfied or it is determined that Taxes shall
be payable by Forasol-Foramer or any of its Subsidiaries as result of the
consummation of all of the transactions provided for herein whether or not any
such Taxes are disclosed on Schedule 2.13(i), in any other provisions of this
Agreement or on any other Schedule hereto (collectively, "Corporate Transaction
Taxes"); provided that, except in circumstances involving fraud, willful
misrepresentation or gross negligence on the part of any of the Sellers, Pride
shall not be entitled to terminate this Agreement upon failure to satisfy the
conditions in Section 7.2(a) or upon the determination that Corporate
Transaction Taxes shall be payable unless the cumulative actual and potential
cost thereof and loss therefrom (after giving effect to all positive facts,
changes and conditions disclosed or discovered subsequent to the date hereof),
as reasonably determined by Pride with the concurrence of its independent
accountants, exceeds U.S. $20 million;
(e) by Forasol-Foramer if the conditions to the
obligations of Forasol-Foramer set forth in Section 7.3 cannot be satisfied;
provided that, except in circumstances involving fraud, willful
misrepresentation or gross negligence on the part of Pride, Forasol-Foramer
shall not be entitled to terminate this Agreement upon failure to satisfy the
conditions in Section 7.3(a) unless the cumulative actual and potential cost
thereof and loss therefrom to the shareholders of Forasol-Foramer (after giving
effect to all positive facts, changes and conditions disclosed or discovered
subsequent to the date hereof), as reasonably determined by Forasol-Foramer
with the concurrence of its independent accountants, exceeds U.S. $20 million;
or
(f) by either Forasol-Foramer or Pride if Forasol-Foramer
shall exercise the right specified in clause (ii) of Section 5.2(a); provided
that Forasol-Foramer may not effect such termination pursuant to this Section
8.1(f) unless and until (i) Forasol-Foramer gives Pride at least five business
days' prior notice of its intention to effect such termination pursuant to this
Section 8.1(f) and (ii) at the conclusion of such period, Pride shall have not
matched the Acquisition Proposal that is the subject of such notice.
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<PAGE> 47
(i) Effect of Termination.
(g) If this Agreement is terminated by any party hereto
as provided in Section 8.1, this Agreement shall forthwith become void and
there shall be no liability or obligation on the part of Pride or the Sellers,
except as expressly provided in this Section 8.2.
(h) If Pride is unable to consummate the transactions
provided for herein solely as a result of its failure to obtain the requisite
approval of its shareholders and this Agreement is terminated pursuant to
Section 8.1(b)(ii), Pride shall pay to Forasol-Foramer, within two business
days following the earlier of the time of such termination or the time of final
adjournment or cancellation of the Pride Shareholders' Meeting, the base sum of
U.S.$5.0 million, plus an additional payment of U.S.$15.0 million if (i) a
person or group of persons (as contemplated by Section 13(d)(3) of the Exchange
Act) shall have become the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of 10% or more of the outstanding shares of Pride Common Stock or
(ii) a proxy contest to acquire control of Pride shall have been initiated. The
parties hereto agree that the amount of such break-up or termination fee is
reasonable compensation to Forasol-Foramer to compensate it for its
undertakings herein, the incurring of costs and expenses related hereto and the
loss or potential loss by Forasol-Foramer of other opportunities.
(i) If Forasol-Foramer or Pride terminates this Agreement
pursuant to Section 8.1(f), Forasol-Foramer shall pay to Pride (which payment
is hereby guaranteed by the Forasol Controlling Shareholders, jointly and
severally, to the extent of nonpayment by Forasol-Foramer), within two business
days following such termination, the base sum of U.S.$5.0 million plus 40% of
the excess of the total value of the Acquisition Proposal over the total value
of the Stock Consideration and the Cash Consideration (up to a maximum
aggregate payment of U.S.$20.0 million) to compensate Pride for its
undertakings herein, the incurring of costs and expenses related hereto and the
loss or potential loss by Pride of other opportunities. The parties hereto
agree that the amount of such break-up or termination fee is reasonable under
the circumstances. For purposes of this Section 8.2(c), the total value of the
Stock Consideration shall be based on U.S. $15-1/4 per share, which was the
closing price of the Pride Common Stock on the Nasdaq National Market on
October 25, 1996.
(i) Amendment. This Agreement may be amended by
the parties hereto, by action taken or authorized by their respective Boards of
Directors, at any time before or after approval of the Pride Vote Matter and
the Forasol Vote Matter by the shareholders of Pride and Forasol-Foramer,
respectively, but, after any such approval, no amendment shall be made that by
law requires further approval by such shareholders without such further
approval. This Agreement may not be amended except by an instrument in writing
signed on behalf of each of the parties hereto.
(ii) Extension; Waiver. At any time prior to the
Closing Date, the parties hereto, by action taken or authorized by their
respective Boards of Directors, may, to the extent legally allowed: (a) extend
the time for the performance of any of the obligations or other acts of the
other parties hereto; (b) waive any inaccuracies in the representations and
warranties contained herein or in any document delivered pursuant hereto; and
(c) waive compliance with any of the agreements or conditions contained herein.
Any agreement on the part of a party hereto to any such
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<PAGE> 48
extension or waiver shall be valid only if set forth in a written instrument
signed on behalf of such party.
ARTICLE 0.9
GENERAL PROVISIONS
(i) Payment of Expenses. Except as expressly
provided herein or as disclosed on a schedule hereto, each party hereto shall
pay its own expenses incident to preparing for entering into and carrying out
this Agreement and the consummation of the transactions contemplated hereby,
whether or not such transactions shall be consummated.
(ii) Nonsurvival of Representations and
Warranties; Survival of Covenants. None of the representations and warranties
in this Agreement or in any instrument delivered pursuant to this Agreement
shall survive the Closing, and any liability for breach or violation thereof
shall terminate absolutely and be of no further force and effect following the
Closing. The covenants, agreements and undertakings of the parties set forth
in this Agreement shall survive indefinitely. Statements contained in any
schedule to this Agreement or any certificate or other documents delivered
pursuant to this Agreement shall be deemed to be representations and warranties
within the meaning of this Section 9.2.
(iii) Notices. Any notice or communication
required or permitted hereunder shall be in writing and either delivered
personally, telegraphed or telecopied or sent by certified or registered mail,
postage prepaid, and shall be deemed to be given, dated and received when so
delivered personally, telegraphed or telecopied or, if mailed, five business
days after the date of mailing to the following address or telecopy number, or
to such other address or addresses as such person may subsequently designate by
notice given hereunder:
(a) if to Pride, to:
Pride Petroleum Services, Inc.
1500 City West Blvd.
Suite 400
Houston, Texas 77042
Attention: Paul A. Bragg
Vice President & Chief Financial
Officer
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<PAGE> 49
with copies to:
Robert W. Randall
Vice President & General Counsel
Pride Petroleum Services, Inc.
1500 City West Blvd.
Suite 400
Houston, Texas 77042
and
L. Proctor Thomas
Baker & Botts, L.L.P.
910 Louisiana
One Shell Plaza
Houston, Texas 77002
and (b) if to the Sellers, to:
Forasol-Foramer N.V.
c/o Forasol S.A.
16 bis
rue Grange Dame Rose
BP 100-78 143
Velizy-Villacoublay Ceclex
France
Attention: Remi Dorval
Supervisory Director
Soletanche Group
6 rue de Watford
92000 Nanterre
France
Attention: Remi Dorval
Director
Sertofin B.V.
Zeemansstraat 113
3016 CN Rotterdam
The Netherlands
Attention: C.J. Boon Falleur
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<PAGE> 50
with copies to:
Jean-Marc Laveissiere
General Counsel & Secretary
Forasol S.A.
16 bis
rue Grange Dame Rose
BP 100-78 143
Velizy-Villacoublay Ceclex
France
and
Kees ten Brink
Trenite Van Doorne
'Plaza' Weena 666
P.O. Box 190
3000 AD Rotterdam
The Netherlands
and
T. Mark Kelly
Vinson & Elkins L.L.P.
1001 Fannin
2300 First City Tower
Houston, Texas 77002
(iv) Interpretation. When a reference is made in
this Agreement to Sections, such reference shall be to a Section of this
Agreement unless otherwise indicated. The table of contents, glossary of
defined terms and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. Whenever the words "include," "includes" or "including" are
used in this Agreement, they shall be deemed to be followed by the words
"without limitation." Unless the context otherwise requires, "or" is
disjunctive but not necessarily exclusive, and words in the singular include
the plural and in the plural include the singular.
(v) Counterparts. This Agreement may be executed
in two or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when two or more counterparts have been
signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
(vi) Entire Agreement; No Third-Party
Beneficiaries. This Agreement (a) constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereto and (b) except as
provided in
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<PAGE> 51
Sections 6.7, 6.8, 6.10 and 6.20, is not intended to confer upon any person
other than the parties hereto any rights or remedies hereunder.
(vii) Governing Law. THIS AGREEMENT HAS BEEN
NEGOTIATED BY OR ON BEHALF OF THE PARTIES IN THE STATE OF TEXAS AND, EXCEPT TO
THE EXTENT THAT THE STATUTORY REQUIREMENTS FOR CONSUMMATING THE TRANSACTIONS
PROVIDED FOR HEREIN ARE GOVERNED EXCLUSIVELY BY THE LAWS OF ANOTHER
JURISDICTION, THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REFERENCE TO THE CHOICE OF LAW
PRINCIPLES THEREOF.
(viii) Arbitration. Any dispute, controversy or
claim arising out of or relating to this Agreement or the breach, termination
or invalidity hereof shall be finally settled by arbitration under the Rules of
Conciliation and Arbitration of the International Chamber of Commerce in effect
on the date of this Agreement by three arbitrators appointed in accordance with
said Rules. The arbitration shall take place in Houston, Texas and the
language of the arbitration shall be English. Judgment upon the award of the
arbitrators may be entered in any court having jurisdiction thereof. The
parties acknowledge that this agreement to arbitrate and any award rendered
pursuant to this agreement shall be governed by the 1958 United Nations
Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
(ix) No Remedy in Certain Circumstances. Each
party agrees that, should any court or other competent authority hold any
provision of this Agreement or part hereof to be null, void or unenforceable,
or order any party to take any action inconsistent herewith or not to take an
action consistent herewith or required hereby, the validity, legality and
enforceability of the remaining provisions and obligations contained or set
forth herein shall not in any way be affected or impaired thereby, unless the
foregoing inconsistent action or the failure to take an action constitutes a
material breach of this Agreement or makes the Agreement impossible to perform,
in which case this Agreement shall terminate pursuant to Article VIII hereof.
Except as otherwise contemplated by this Agreement, to the extent that a party
hereto took an action inconsistent herewith or failed to take action consistent
herewith or required hereby pursuant to an order or judgment of a court or
other competent authority, such party shall not incur any liability or
obligation unless such party breached its obligations under Section 6.4 hereof
or did not in good faith seek to resist or object to the imposition or entering
of such order or judgment.
(x) Assignment. Neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties, except that Pride, in its sole
discretion, may assign any or all of its rights hereunder to any wholly owned
Subsidiary of Pride. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.
(xi) Schedules. For purposes of this Agreement,
Schedules shall mean the Schedules contained in the Confidential Disclosure
Schedules, dated the date hereof, delivered in connection with this Agreement
and initialed by the parties hereto. This Agreement shall have no force or
effect until such schedules have been so delivered and initialed.
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<PAGE> 52
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.
<TABLE>
<S> <C>
PRIDE PETROLEUM SERVICES, INC. FORASOL-FORAMER N.V.
By: /s/ RAY H. TOLSON By: /s/ REMI DORVAL
----------------------------- ----------------------------------------
Name: Ray H. Tolson Name: Remi Dorval
Title: President Title: Supervisory Director of Forasol-
Foramer N.V., Managing Director
and Chief Executive Officer of
IDM B.V.
/s/ CHRISTIAN J. BOON FALLEUR
----------------------------------------
Name: Christian J. Boon Falleur
Title: Supervisory Director of Forasol-
Foramer N.V., Executive Vice
President of IDM B.V.
FORASOL CONTROLLING SHAREHOLDERS:
GIALOS B.V. SERTOFIN B.V.
By: /s/ YVES BENOIT By: /s/ LUC BERTRAND
----------------------------------------
Name: Yves Benoit Name: Luc Bertrand
Title: Managing Director Title: Director
COMPAGNIE FINANCIERE DE /s/ ALAIN DIERYCK
----------------------------------------
SERVICES PETROLIERS S.A. Name: Alain Dieryck
Title: Director
By: /s/ YVES BENOIT
-----------------------------
Name: Yves Benoit
Title: Financial Manager
</TABLE>
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