Execution Version (as revised)
ASSET ACQUISITION AGREEMENT
BY AND BETWEEN
GLOBAL INDUSTRIES, LTD.
AND
OCEANEERING INTERNATIONAL, INC.
DATED AS OF SEPTEMBER 30, 2000
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 Definitions 1
ARTICLE II
PURCHASE AND SALE
2.1 Assets being Conveyed by Oceaneering 6
2.2 Assets being Conveyed by Global 6
2.3 Assumption of Liabilities by Oceaneering -
Completion of Certain Contracts 7
2.4 Assumption of Liabilities by Global -
Completion of Certain Contracts. 7
ARTICLE III
CLOSING
3.1 The Closing 7
3.2 Documents being Delivered to Global 8
3.3 Documents being Delivered to Oceaneering 8
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF OCEANEERING
4.1 Organization 9
4.2 Authorizations, Execution and Consents 9
4.3 Tax Matters. 10
4.4 Title to Assets 10
4.5 Intellectual Property 11
4.6 Contracts and Commitments 12
4.7 Licenses and Permits 12
4.8 Compliance with Law 12
4.9 Litigation 13
4.10 Brokers. 13
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF GLOBAL
5.1 Organization 13
5.2 Authorizations, Execution and Consents 13
5.3 Tax Matters. 14
5.4 Title to Assets 14
5.5 Intellectual Property 15
5.6 Contracts and Commitments 16
5.7 Licenses and Permits 16
5.8 Compliance with Law 16
5.9 Litigation 16
5.10 Brokers 17
ARTICLE VI
COVENANTS
6.1 Actions of the Parties 17
6.2 Certain Employee Matters 17
6.3 Protection of Value of Diving Business Assets 18
6.4 Protection of Value of ROV Purchased Assets 19
6.5 Assignment of Contracts 21
6.6 Taxes and Expenses 21
6.7 Access to Records After Closing. 22
6.8 Allocation of Revenues from Assumed Contracts 22
6.9 Transition Assistance 23
6.10 Facility Arrangements and ROV Services Agreement 23
6.11 Preferred Provider 24
6.12 Further Assurances 24
ARTICLE VII
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
7.1 Survival of Representations 24
7.2 Indemnity 25
7.3 Notice and Participation 26
7.4 Indemnification of Negligence of Indemnitee 27
7.5 Indemnification Threshold and Limitations;
Exclusive Remedy 28
7.6 Payment 28
ARTICLE VIII
MISCELLANEOUS
8.1 Waivers and Amendments 28
8.2 Notices 28
8.3 Headings; Article and Section References 29
8.4 Entire Agreement 29
8.5 Severability 30
8.6 Public Announcements 30
8.7 Governing Law 30
8.8 Successors and Assigns 30
8.9 Counterparts. 30
8.10 Risk of Loss 30
8.11 Transfer of Certain Assets 30
Appendix I - List of Oceaneering's Affiliates who own any of
the Diving Business Assets
Appendix II - List of Global's Affiliates who own any of
the ROV Business Assets
ASSET ACQUISITION AGREEMENT
THIS ASSET ACQUISITION AGREEMENT (this "Agreement") dated
as of September 30, 2000, is made and entered into by and between
GLOBAL INDUSTRIES, LTD., a Louisiana corporation ("Global"),
and OCEANEERING INTERNATIONAL, INC., a Delaware corporation
("Oceaneering").
R E C I T A L S:
Oceaneering and the Oceaneering Affiliates are, among other
things, engaged in the business of providing commercial diving
services in the waters offshore Australia, India, Egypt, South
and Southeast Asia and China as well as in the Persian Gulf and
the Red Sea (hereinafter, the "Diving Business").
Oceaneering desires to sell and to cause the Oceaneering
Affiliates to sell and Global desires to purchase or cause
certain of its Affiliates to purchase the assets of the Diving
Business referred to herein, upon the terms hereinafter set
forth.
Global and the Global Affiliates are, among other things,
engaged in the business of providing remotely operated vehicles
("ROVs") and ROV operators in South and Southeast Asia and
Australia (hereinafter, the "ROV Business"; provided that the
term "ROV Business" does not include the operations or assets
of ROV Technologies, a division of Global).
Global desires to sell and to cause the Global Affiliates to
sell and Oceaneering desires to purchase or cause certain of its
Affiliates to purchase the assets of the ROV Business referred to
herein, upon the terms hereinafter set forth.
It is the intention of the parties hereto to cause each of
their Affiliates listed on Appendix I or II, as applicable, to
enter into a Supplemental Asset Acquisition Agreement, for the
purpose of having each such Person convey any and all of the
Diving Business Assets or ROV Business Assets each as referred to
herein owned by it to the other party hereto or, in accordance
with Section 8.11, to certain of such other parties' Affiliates.
NOW, THEREFORE, in consideration of the premises, the mutual
benefits to be derived from this Agreement and the respective
representations, warranties, covenants and agreements herein
contained, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions Unless otherwise defined herein or unless
the context otherwise requires, capitalized terms used in this
Agreement shall have the following meanings:
"Action" shall mean any action, suit, inquiry, proceeding
or investigation by or before any Governmental Entity or any
arbitration proceeding.
"Affiliate" shall mean with respect to any Person, any
Person directly or indirectly controlled by such Person. For
this purpose, control means the possession, direct or indirect,
of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday other than days on which banking institutions
in the State of Texas are authorized or obligated by law or
executive order to close.
"Closing" shall mean the consummation of the transactions
between Global and Oceaneering contemplated hereby, which is
being effected concurrently with the execution and delivery of
this Agreement.
"Diving Business" shall have the meaning ascribed thereto
in the Recitals to this Agreement.
"Diving Business Assets" shall mean all right, title and
interest of Oceaneering or any of the Oceaneering Affiliates in
and to the assets listed or described below:
(a) the vessel known as the "Ocean Winsertor"
(Official No. 7397), including without limitation, all blue
prints and construction drawings related to the vessel in
the possession of Oceaneering or any of its Affiliates and
all equipment, accessories, inventories of supplies, stores
and spare parts primarily used in the operation of the
vessel as well as the galley inventory and consumables
normally included on the vessel during its operations;
(b) the saturation diving systems and all air diving
systems listed or described on Schedule 1.1(b) to the
Oceaneering Disclosure Letter, including, without
limitation, all blue prints and construction drawings
related to any of the systems in the possession of
Oceaneering or its Affiliates and all equipment,
accessories, inventories of supplies, stores and spare parts
primarily related to or primarily used in the operation of
such systems;
(c) all equipment (including without limitation all
computer equipment and hardware), machinery, tools,
furniture, spare and replacement parts, and supplies
primarily relating to or primarily used in the Shekou,
China, Jebel Ali, United Arab Emirates or Sale, Australia
office, including without limitation those listed or
described on Schedule 1.1(c) to the Oceaneering Disclosure
Letter;
(d) all property listed or described on
Schedule 1.1(d) to the Oceaneering Disclosure Letter;
(e) all the contracts, agreements and arrangements
related to the Diving Business that are listed on Schedule
1.1(e) to the Oceaneering Disclosure Letter, the obligations
under all of which are being assumed by Global hereunder
(the "Diving Business Assumed Contracts");
(f) all files and correspondence with customers,
vendors, suppliers or subcontractors relating to outstanding
bids, projects in progress or projects awarded but not yet
in progress, maintenance procedures and records, written
technical information, technical drawings and operating and
maintenance manuals primarily relating to the Diving
Business; and
(g) all Permits primarily relating to the Diving
Business Assets, to the extent transferable, including
without limitation those listed in Schedule 1.1(g) to the
Oceaneering Disclosure Letter and characterized therein as
transferable, all as the same may exist on the date of this
Agreement.
"Diving Business Assumed Contracts" shall have the meaning
ascribed thereto in the definition of Diving Business Assets.
"Diving Business Shared Facilities" shall mean the
facilities owned or leased by Oceaneering or one of the
Oceaneering Affiliates and currently used in connection with the
operation of the Diving Business at the following locations:
Jurong, Singapore; Jakarta, Indonesia; and Sale, Australia.
"Diving Business Transferred Facilities" shall mean the
facilities leased by Oceaneering or one of the Oceaneering
Affiliates and currently used in connection with the operation of
the Diving Business at the following locations: Shekou, China;
and Jebel Ali, United Arab Emirates.
"Effective Time" shall mean 11:59 p.m., Houston time, on
September 30, 2000.
"Environmental Laws" shall mean any and all Laws, orders
or determinations of any Governmental Entity (including common
law duties established by courts or other Governmental Entities)
pertaining to pollution or the protection of human health and
safety, employee health and safety or the environment including
Laws relating to emissions, discharges, releases, or threatened
releases of pollutants, contaminants, or chemical, industrial,
hazardous, or toxic materials or wastes into ambient air, surface
water, groundwater, or lands or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants, or
chemical, industrial, hazardous, or toxic materials or wastes, in
effect on the date of this Agreement in any jurisdiction,
federal, state, local or foreign, in which the Diving Business or
ROV Business, as the case may be, is operated.
"Global Affiliates" shall mean those Affiliates of Global
that own any of the ROV Business Assets each of which is listed
on Appendix II.
"Global Disclosure Letter" shall mean a letter of even
date with this Agreement addressed by Global to Oceaneering and
setting forth information relating to, among other things,
Global's representations and warranties contained in Article V of
this Agreement.
"Global Documents" shall mean this Agreement and all other
agreements, instruments and certificates to be executed and
delivered by Global or the Global Affiliates in connection with
this Agreement.
"Global Indemnitees" shall have the meaning ascribed
thereto in Section 7.2(a) herein.
"Governmental Entity" shall mean any court or any federal,
state, local or foreign legislative body or governmental
department, commission, board, bureau, agency or authority.
"Indemnitee" shall have the meaning ascribed thereto in
Section 7.3 herein.
"Indemnitor" shall have the meaning ascribed thereto in
Section 7.3 herein.
"known" or "knowledge" shall mean, when used in a
statement regarding the existence or absence of facts in this
Agreement that is qualified by a phrase such as "to such
Person's knowledge" or "known to such Person," information
actually known to (a) the Person in a case of an individual or
(b) in the case of a corporation or other entity, any executive
officer or director of such corporation or its Affiliates.
"Law" shall mean any law, statute, rule, regulation,
ordinance, requirement, announcement or other binding action or
requirement of a Governmental Entity.
"Liens" shall mean all mortgages, deeds of trust, liens,
security interests, pledges, conditional sale contracts, claims,
rights of first refusal, options, charges, liabilities,
obligations, easements, rights-of-way, limitations, reservations,
restrictions and other encumbrances of any kind other than (i)
Liens for current Taxes not yet due and payable, including Liens
for non-delinquent ad valorem Taxes; (ii) Liens of carriers,
warehousemen, mechanics, laborers, materialmen and suppliers for
sums not yet due; (iii) statutory Liens arising other than by
reason of any default on the part of the owner; (iv) Liens
incurred in the ordinary course of the Diving Business or the ROV
Business, as applicable, to secure the performance of bids,
tenders, trade contracts, statutory obligations, surety and
appeal bonds, performance and return-of-money bonds and other
obligations of like nature; and (v) easements, rights-of-way,
reservations, restrictions and other similar encumbrances
incurred in the ordinary course of the Diving Business or the ROV
Business, as applicable, or existing on property that do not in
any material respect detract from the value or materially
interfere with the ordinary use and operation of the Diving
Business Assets or the ROV Business Assets, as applicable.
"Losses" shall mean all damages, awards, judgments,
payments, debts, liabilities, obligations, and other losses
however suffered or characterized, all interest thereon, all
costs and expenses, including without limitation the cost of
investigation, together with all reasonable attorneys' fees
incurred in connection therewith, and, all amounts paid incident
to any compromise or settlement of any claim, lawsuit or
arbitration.
"Material Adverse Effect" shall mean with respect to the
Diving Business Assets or the ROV Business Assets, a change in
the condition or permissible use thereof that (individually or in
the aggregate) is material and adverse to the Diving Business
Assets, taken as a whole or the ROV Business Assets, taken as a
whole, respectively.
"Oceaneering Affiliates" shall mean those Affiliates of
Oceaneering that own any Diving Business Assets, each of which is
listed on Appendix I hereto.
"Oceaneering Disclosure Letter" shall mean a letter of
even date with this Agreement addressed by Oceaneering to Global
and setting forth information relating to, among other things,
Oceaneering's representations and warranties contained in
Article IV of this Agreement.
"Oceaneering Documents" shall mean this Agreement and all
other agreements, instruments and certificates to be executed and
delivered by the Oceaneering or the Oceaneering Affiliates in
connection with this Agreement.
"Oceaneering Indemnitees" shall have the meaning ascribed
thereto in Section 7.2(b) herein.
"Permits" shall mean all permits, licenses, registrations,
franchises, concessions, orders, certificates, consents,
authorizations and approvals of any Governmental Entity.
"Person" shall mean (i) any natural person, entity,
estate, trust, union or employee organization or Governmental
Entity, and (ii) the term "entity" shall mean any sole
proprietorship, corporation, partnership of any kind having a
separate legal status, limited liability company, business trust,
unincorporated organization or association, mutual company, joint
stock company or joint venture.
"ROV" shall mean remotely operated vehicles.
"ROV Business" shall have the meaning ascribed thereto in
the Recitals to this Agreement.
"ROV Business Assets" shall mean all right, title and
interest of Global or any of the Global Affiliates in and to the
assets listed or described below:
(a) the ROVs listed or described on Schedule 1.1(a) to
the Global Disclosure Letter, including without limitation,
all blue prints and construction drawings related to any of
such ROVs in the possession of Global or any of its
Affiliates and all equipment, accessories, inventories of
supplies, stores and spare parts primarily related to or
primarily used in the operation of such ROVs excluding,
however, (i) any vessels and (ii) their related equipment,
accessories, inventories of supplies, stores and spare parts
that are not primarily related to or used in the operation
of the ROVs.
(b) all property listed or described on Schedule
1.1(b) to the Global Disclosure Letter;
(c) all the contracts, agreements and arrangements
related to the ROV Business that are listed on Schedule
1.1(c) to the Global Disclosure Letter, the obligations
under all of which are being assumed by Oceaneering
hereunder (the "ROV Business Assumed Contracts");
(d) all Permits primarily relating to the ROV Business
Assets, to the extent transferable, including without
limitation those listed in Schedule 1.1(d) to the Global
Disclosure Letter and characterized therein as transferable,
all as the same may exist on the date of this Agreement;
(e) all files and correspondence with customers,
vendors, suppliers or subcontractors relating to outstanding
bids, projects in progress or projects awarded but not yet
in progress, maintenance procedures and records, written
technical information, technical drawings and operating and
maintenance manuals relating to the ROV Business; and
(f) all proprietary rights to the name "Dragon," as
that name is used in connection with the operation of any of
the ROV Business Assets.
"ROV Business Assumed Contracts" shall have the meaning
ascribed thereto in the definition of ROV Business Assets.
"ROV Business Shared Facility" shall mean the facilities
leased by PT Global Industries Asia Pacific, an Affiliate of
Global, and currently used in connection with the operation of
the ROV Business at Batam Island, Indonesia.
"ROV Services" shall mean the provision of (i) ROV's and
related equipment or (ii) ROV operators, technicians or other
operating personnel.
"Supplemental Asset Acquisition Agreement" shall mean a
Supplemental Asset Acquisition Agreement pursuant to which any of
the Oceaneering Affiliates is transferring to Global or its
Affiliates the Diving Business Assets owned by it or pursuant to
which any of the Global Affiliates is transferring to Oceaneering
or its Affiliates the ROV Business Assets owned by it.
"Taxes" shall mean any federal, state, local or foreign
income, profit, franchise (including without limitation those
that are based on net worth, capitalization, income or total
assets), sales, use, transfer, real property transfer, recording,
value added, superannuation guarantee levy, fringe benefits tax,
real or personal property or other taxes, assessments, fees,
levies, duties (including without limitation customs duties and
similar charges), deductions or other governmental charges of any
nature whatsoever (including without limitation interest and
penalties) imposed by any Law.
"Third Party Claim" shall have the meaning ascribed
thereto in Section 7.3 herein.
"Transfer Taxes" shall mean all sales, use, transfer, real
property transfer, recording, stamp, documentary, value added,
customs duties and similar Taxes that become due and payable
prior to, on or after the Effective Time as the result of (a) the
conveyance of the Diving Business Assets by Oceaneering or any of
the Oceaneering Affiliates to Global or Affiliates of Global or
(b) the conveyance of the ROV Business Assets by Global or any of
the Global Affiliates to Oceaneering or Affiliates of
Oceaneering.
ARTICLE II
PURCHASE AND SALE
2.1 Assets being Conveyed by Oceaneering.
(a) At the Closing, subject to Section 8.11,
Oceaneering shall sell, convey, transfer, assign and deliver
to Global, free and clear of all Liens, and Global will
purchase all of the Diving Business Assets owned by
Oceaneering.
(b) Concurrently with the execution and delivery of
this Agreement, subject to Section 8.11, Oceaneering agrees
to (i) cause each Oceaneering Affiliate to execute and
deliver to Global, and Global agrees to execute and deliver
to such Oceaneering Affiliate, a Supplemental Asset
Acquisition Agreement providing for the sale and purchase of
the Diving Business Assets owned by such Oceaneering
Affiliate and (ii) cause each Oceaneering Affiliate to sell,
convey, transfer, assign and deliver to Global all of the
Diving Business Assets owned by such Oceaneering Affiliate
at the Closing.
(c) Oceaneering is obligated hereunder to sell only
the Diving Business Assets owned by it and to cause each of
the Oceaneering Affiliates to sell only the Diving Business
Assets owned by such Oceaneering Affiliate and Global is
obligated to purchase only the Diving Business Assets.
Notwithstanding anything to the contrary contained herein,
Global shall not be obligated to purchase, and Oceaneering
shall not be obligated hereunder to sell, and none of the
Oceaneering Affiliates shall be obligated under any
Supplemental Asset Acquisition Agreement to sell, any other
assets or properties of Oceaneering or any of the
Oceaneering Affiliates.
2.2 Assets being Conveyed by Global.
(a) At the Closing, subject to Section 8.11, Global
shall sell, convey, transfer, assign and deliver to
Oceaneering, free and clear of all Liens, and Oceaneering
will purchase all of the ROV Business Assets owned by
Global.
(b) Concurrently with the execution and delivery of
this Agreement, subject to Section 8.11, Global agrees to
(i) cause each Global Affiliate to execute and deliver to
Oceaneering, and Oceaneering agrees to execute and deliver
to such Global Affiliate, a Supplemental Asset Acquisition
Agreement providing for the sale and purchase of the ROV
Business Assets owned by such Global Affiliate and (ii)
cause each Global Affiliate to sell, convey, transfer,
assign and deliver to Oceaneering all of the ROV Business
Assets owned by such Global Affiliate at the Closing.
(c) Global is obligated hereunder to sell only the ROV
Business Assets owned by it and to cause each of the Global
Affiliates to sell only the ROV Business Assets owned by
such Global Affiliate and Oceaneering is obligated to
purchase only the ROV Business Assets. Notwithstanding
anything to the contrary contained herein, Oceaneering shall
not be obligated to purchase, and Global shall not be
obligated hereunder to sell, and none of the Global
Affiliates shall be obligated under any Supplemental Asset
Acquisition Agreement to sell, any other assets or
properties of Global or any of the Global Affiliates.
2.3 Assumption of Liabilities by Oceaneering - Completion
of Certain Contracts.
(a) Subject only to Section 2.3(b) below, neither
Oceaneering nor any of the Oceaneering Affiliates is
assuming and none of them will assume, either hereunder or
under any Supplemental Asset Acquisition Agreement, any
liabilities or obligations whatsoever of Global or the
Global Affiliates whether or not relating to the ROV
Business or the ROV Business Assets. Specifically and
without limiting the generality of the foregoing, neither
Oceaneering nor any of the Oceaneering Affiliates is
assuming and none of them will assume any liabilities or
obligations of Global or the Global Affiliates for any Taxes
imposed in connection with the transactions contemplated by
this Agreement or any Supplemental Asset Acquisition
Agreement.
(b) Subject to the provisions hereof and of each
Supplemental Asset Acquisition Agreement, Oceaneering is
assuming, or causing one or more of its Affiliates to
assume, the ROV Business Assumed Contracts as of the
Effective Time and, agrees thereafter, to pay, perform and
discharge when due, or to cause an Affiliate of Oceaneering
to pay, perform and discharge when due, to the extent they
relate to performance after the Effective Time, the
obligations of Global or any Global Affiliate under the ROV
Business Assumed Contracts and none other.
2.4 Assumption of Liabilities by Global - Completion of
Certain Contracts.
(a) Subject only to Section 2.4(b) below, neither
Global nor any of the Global Affiliates is assuming and none
of them will assume, either hereunder or under any
Supplemental Asset Acquisition Agreement, any liabilities or
obligations whatsoever of Oceaneering or the Oceaneering
Affiliates whether or not relating to the Diving Business or
the Diving Business Assets. Specifically and without
limiting the generality of the foregoing, neither Global nor
any of the Global Affiliates is assuming and none of them
will assume any liabilities or obligations of Oceaneering or
the Oceaneering Affiliates for any Taxes imposed in
connection with the transactions contemplated by this
Agreement or any Supplemental Asset Acquisition Agreement.
(b) Subject to the provisions hereof and of each
Supplemental Asset Acquisition Agreement, Global is
assuming, or causing one or more of its Affiliates to
assume, the Diving Business Assumed Contracts as of the
Effective Time and, agrees thereafter, to pay, perform and
discharge when due, or to cause an Affiliate of Global to
pay, perform and discharge when due, to the extent they
relate to performance after the Effective Time, the
obligations of Oceaneering or any Oceaneering Affiliate
under the Diving Business Assumed Contracts and none other.
ARTICLE III
CLOSING
3.1 The Closing. Concurrently with the execution and
delivery of this Agreement, the Closing is taking place at the
offices of Vinson & Elkins L.L.P. on September 30, 2000, to be
effective as of the Effective Time.
3.2 Documents being Delivered to Global.
(a) Concurrently with the execution and delivery of
this Agreement, Oceaneering is delivering, or causing to be
delivered, to Global or such of its Affiliates as it has
designated pursuant to the provisions of Section 8.11:
(i) a general conveyance, transfer and assignment
with respect to all of the Diving Business Assets;
(ii) bills of sale conveying title to all personal
property included in the Diving Business Assets;
(iii) assignments conveying all right, title
and interest of Oceaneering or Oceaneering Affiliates
in the Diving Business Assumed Contracts (subject to
the assumption thereof by Global); and
(iv) certificates of title or other title
documents in recordable form conveying good title to
all vehicles and other transportation equipment
included in the Diving Business Assets.
(b) Oceaneering also is delivering or causing to be
delivered to Global:
(i) such releases by Oceaneering and the
Oceaneering Affiliates of all claims which they may
have against or with respect to the Diving Business
Assets as Global may reasonably request;
(ii) a certified copy of the resolutions of the
Board of Directors of Oceaneering properly authorizing
and approving this Agreement and the transactions
contemplated hereby;
(iii) instruments evidencing Oceaneering's
assumption and agreement to perform the obligations to
be performed after the Effective Time with respect to
the ROV Business Assumed Contracts; and
(iv) possession of the Diving Business Assets.
3.3 Documents being Delivered to Oceaneering.
(a) Concurrently with the execution and delivery of
this Agreement, Global is delivering, or causing to be
delivered, to Oceaneering or such of its Affiliates as it
has designated pursuant to the provisions of Section 8.11:
(i) a general conveyance, transfer and assignment
with respect to all the ROV Business Assets;
(ii) bills of sale conveying title to all personal
property included in the ROV Business Assets;
(iii) assignments conveying all right, title
and interest of Global or Global Affiliates in the ROV
Business Assumed Contracts (subject to the assumption
thereof by Oceaneering); and
(iv) certificates of title or other title
documents in recordable form conveying good title to
all vehicles and other transportation equipment
included in the ROV Business Assets.
(b) Global is delivering or causing to be delivered to
Oceaneering:
(i) such releases by Global and the Global
Affiliates of all claims which they may have against or
with respect to the ROV Business Assets as Oceaneering
may reasonably request;
(ii) a certified copy of the resolutions of the
Board of Directors of Global properly authorizing and
approving this Agreement and the transactions
contemplated hereby;
(iii) instruments evidencing Global's
assumption and agreement to perform the obligations to
be performed after the Effective Time with respect to
the Diving Business Assumed Contracts; and
(iv) possession of the ROV Business Assets.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF OCEANEERING
Oceaneering represents and warrants to Global as follows:
4.1 Organization. Oceaneering, each of the Oceaneering
Affiliates and any other Affiliate of Oceaneering to whom any of
the ROV Business Assets are being transferred by Global or any of
the Global Affiliates, is a corporation duly incorporated,
validly existing and in good standing under the Laws of the
jurisdiction of its incorporation.
4.2 Authorizations, Execution and Consents Error! Bookmark
not defined..
(a) Oceaneering has full corporate power and authority
to execute and deliver this Agreement and the other
Oceaneering Documents to which it is a party and to carry
out and perform its obligations as provided herein and
therein. Each Oceaneering Affiliate has full corporate
power and authority to execute and deliver the Supplemental
Asset Acquisition Agreement to which it is a party and the
other Oceaneering Documents to which it is a party and to
carry out and perform its obligations as provided in the
Supplemental Asset Acquisition Agreement to which it is a
party and the other Oceaneering Documents to which it is a
party.
(b) This Agreement, each Supplemental Asset
Acquisition Agreement and each of the other Oceaneering
Documents have been duly and validly authorized by all
proper and requisite corporate actions and duly executed and
delivered by Oceaneering and, where applicable, the
Oceaneering Affiliate a party thereto, and constitutes the
legal, valid and binding obligation of Oceaneering and,
where applicable, the Oceaneering Affiliate a party thereto,
enforceable against Oceaneering and, where applicable, the
Oceaneering Affiliate a party thereto, in accordance with
its terms except to the extent that enforceability may be
limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or
transfer and similar laws affecting creditors' rights and
remedies generally and general privileges of equity
(regardless of whether enforcement is considered in a
proceeding at law or in equity).
(c) Except as set forth on Schedule 4.2 to the
Oceaneering Disclosure Letter, the execution and delivery of
and performance under this Agreement, the Supplemental Asset
Acquisition Agreements and the other Oceaneering Documents
by Oceaneering and, where applicable, the Oceaneering
Affiliate a party thereto and consummation of the
transactions contemplated hereby and thereby, (i) will not
conflict with or breach any provision of the certificate of
incorporation, charter or bylaws or similar organizational
documents of Oceaneering or any Oceaneering Affiliate or
violate any Law, judgment, order, writ, injunction or decree
applicable to Oceaneering or any Oceaneering Affiliate or
any of the Diving Business Assets; (ii) will not conflict
with or breach or constitute any default (with or without
notice or lapse of time or both) under or give rise to any
rights of termination, cancellation or acceleration under or
result in or require the creation or imposition of any Lien
on any of the Diving Business Assets under, any contract,
agreement, permit or license to which Oceaneering or any
Oceaneering Affiliate is a party or by which Oceaneering or
any Oceaneering Affiliate is bound other than those that
would not have a Material Adverse Effect on the Diving
Business Assets or adversely affect the ability of
Oceaneering or the Oceaneering Affiliates to consummate the
transactions contemplated by this Agreement and the other
Oceaneering Documents; (iii) will not require any filing
with, notification of or consent, approval or authorization
of any Governmental Entity or any third Person.
4.3 Tax Matters.
(a) All Taxes based upon, measured by, or arising by
reason of the ownership or operation of the Diving Business
Assets or sales resulting from the productive use of such
Diving Business Assets which have become due and payable
have been duly and timely paid, all applicable returns and
reports of or with respect to any Tax that are required to
be filed by or with respect to Oceaneering or any
Oceaneering Affiliate relating to the Diving Business Assets
have been duly and timely filed, and there is no claim
pending or threatened by any applicable taxing authority in
connection with any such Taxes, except for failures to pay
or file and claims that could not (i) have a Material
Adverse Effect on the Diving Business Assets or (ii) result
in the imposition of any Lien on any of the Diving Business
Assets after the Effective Time.
(b) There are no Liens for Taxes upon any of the
Diving Business Assets.
(c) There is not in force any extension of time with
respect to the due date for the filing of any Tax return or
Tax report of or with respect to any of the Diving Business
Assets or any waiver or agreement for any extension of time
for the assessment or payment of any Tax of or with respect
to any of the Diving Business Assets.
4.4 Title to Assets.
(a) Oceaneering or the Oceaneering Affiliates have,
and upon delivery of possession in the manner contemplated
hereby Global or its Affiliates will acquire, the Diving
Business Assets free and clear of all Liens. All of the
Diving Business Assets are owned legally and beneficially by
Oceaneering or Oceaneering Affiliates. Except for this
Agreement and the Supplemental Asset Acquisition Agreements,
neither Oceaneering nor any of the Oceaneering Affiliates is
a party to any option, purchase right or other contract or
commitment that could require them to sell, transfer or
otherwise dispose of any of the Diving Business Assets and,
except for the Diving Business Assumed Contracts, there is
no lease, contract or other agreement applicable to or
binding upon any of the Diving Business Assets.
(b) Global acknowledges that it has conducted to its
satisfaction an independent investigation and verification
of the assets of the Diving Business and, in making its
determination to proceed with the transactions contemplated
by this Agreement, Global has relied on the results of its
own independent investigation and the representations and
warranties of Oceaneering expressly and specifically set
forth in this Agreement. SUCH REPRESENTATIONS AND
WARRANTIES BY OCEANEERING CONSTITUTE THE SOLE AND EXCLUSIVE
REPRESENTATIONS AND WARRANTIES OF OCEANEERING TO GLOBAL IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY, AND
GLOBAL UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT ALL OTHER
REPRESENTATIONS AND WARRANTIES OF ANY KIND OR NATURE WHETHER
EXPRESS, IMPLIED OR STATUTORY (INCLUDING WITHOUT LIMITATION
ANY RELATING TO THE FUTURE OR HISTORICAL FINANCIAL
CONDITION, RESULTS OF OPERATIONS, ASSETS OR LIABILITIES OF
THE DIVING BUSINESS) ARE SPECIFICALLY DISCLAIMED BY
OCEANEERING. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, NEITHER OCEANEERING NOR ANY OF THE OCEANEERING
AFFILIATES MAKES ANY WARRANTY OR COVENANT OF ANY KIND,
EXPRESS, IMPLIED OR STATUTORY. WITHOUT LIMITING THE
GENERALITY OF THE IMMEDIATELY PRECEDING SENTENCE, WITH
RESPECT TO ANY OF THE DIVING BUSINESS ASSETS, EXCEPT AS
EXPRESSLY PROVIDED FOR HEREIN, OCEANEERING, ON ITS OWN
BEHALF AND ON BEHALF OF EACH OF THE OCEANEERING AFFILIATES,
EXPRESSLY DISCLAIMS AND NEGATES: (i) ANY IMPLIED OR EXPRESS
WARRANTY OF MERCHANTABILITY; (ii) ANY IMPLIED OR EXPRESS
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE; (iii) ANY
IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR
SAMPLES OF MATERIALS OR FREEDOM FROM PATENT INFRINGEMENTS;
(iv) ANY IMPLIED OR EXPRESS WARRANTY AS TO THE ACCURACY OF
ANY OF THE INFORMATION FURNISHED WITH RESPECT TO THE VALUE
OF THE DIVING BUSINESS ASSETS OR STATE OF REPAIR THEREOF, IT
BEING UNDERSTOOD THAT THE DIVING BUSINESS ASSETS ARE
CONVEYED AS IS, WHERE IS AND WITH ALL FAULTS. GLOBAL ALSO
ACKNOWLEDGES THAT ITS SOLE AND EXCLUSIVE RECOURSE IN RESPECT
OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT IS TO
ASSERT ITS RIGHTS PURSUANT TO ARTICLE VII. Oceaneering and
Global agree that, to the extent required by any applicable
Law to be operative, the disclaimers of warranties contained
in this Section 4.4(b) are "conspicuous" disclaimers.
4.5 Intellectual Property.
(a) Except as disclosed in Schedule 4.5 to the
Oceaneering Disclosure Letter:
(i) There are no unexpired U.S. and foreign
patents, pending patent applications and currently
active identified inventions which are owned by
Oceaneering or any of its Affiliates and which are
necessary for the operation of the Diving Business
Assets in the manner in which they have been operated
in the last three months or are currently being
operated;
(ii) There are no agreements relating in any way
to the Diving Business Assets (x) under which royalties
presently are payable or may in the future become
payable or (y) which concern ownership, use or
disclosure of intellectual property, technology,
processes or proprietary information of any Person
relating to the Diving Business Assets;
(b) No Person has asserted that either Oceaneering or
any Affiliate of Oceaneering is infringing or has infringed
within the three years prior to the date hereof, any foreign
or domestic patent, trademark, service mark, trade name, or
copyright, or has misappropriated or improperly used or
disclosed any trade secret, confidential information or know
how in connection with the Diving Business Assets; and
(c) No operations of Oceaneering or any Oceaneering
Affiliate relating to the Diving Business Assets are
infringing, or have infringed within the three years prior
to the date hereof, any foreign or domestic patent,
trademark, service mark, trade name or copyright of any
Person, or were involved in any misappropriation or improper
use or disclosure of any trade secret, confidential
information or know how of any Person.
4.6 Contracts and Commitments. True and correct copies of
all Diving Business Assumed Contracts have been provided to
Global. All the Diving Business Assumed Contracts are valid,
binding and in full force and effect, have not been amended or
supplemented in any manner or respect except as disclosed on
Schedule 4.6 to the Oceaneering Disclosure Letter. There are no
defaults by Oceaneering or any Oceaneering Affiliate under any
Diving Business Assumed Contract, and, to the knowledge of
Oceaneering (a) there are no material defaults under any Diving
Business Assumed Contract by any other party thereto and (b) no
events have occurred that with the lapse of time or action or
inaction by any party thereto would result in any material
defaults thereunder. Except as disclosed in Schedule 4.6 to the
Oceaneering Disclosure Letter, the Diving Business Assumed
Contracts may be assigned to Global without any authorization,
consent, approval, permission or license of, or filing with, any
other Person.
4.7 Licenses and PermitsError! Bookmark not defined.. The
Permits listed in Schedule 1.1(g) to the Oceaneering Disclosure
Letter constitute all the Permits held by Oceaneering or any
Oceaneering Affiliate that primarily relate to the Diving
Business and, except as set forth in Schedule 4.7 to the
Oceaneering Disclosure Letter constitute all material Permits
necessary under applicable Laws, including applicable
Environmental Laws, for Oceaneering and the Oceaneering
Affiliates to own, operate, maintain and use the Diving Business
Assets in the manner in which they are now, and during the
preceding 12 months have been, operated, maintained and used.
Each of such Permits and the rights of Oceaneering or any
Oceaneering Affiliate with respect thereto are valid and
subsisting, in full force and effect and enforceable by
Oceaneering or such Oceaneering Affiliate. Oceaneering or the
applicable Oceaneering Affiliate (depending on the holder
thereof) is now and has at all times in the past 12 months been
in compliance with the terms of such Permits except, in each
case, where the failure to remain in compliance would not (i)
have a Material Adverse Effect on the Diving Business Assets or
(ii) result in any Lien on any of the Diving Business Assets
after the Effective Time. None of such Permits has been or, to
the knowledge of Oceaneering, is threatened to be revoked,
canceled, suspended or modified.
4.8 Compliance with Law. Oceaneering and the Oceaneering
Affiliates have operated the Diving Business Assets in compliance
with all applicable Laws, including Environmental Laws, the
Foreign Corrupt Practices Act and the Export Administration Act
and the rules and regulations promulgated thereunder, except, in
each case, where the failure to comply would not have a Material
Adverse Effect on the Diving Business Assets. Neither
Oceaneering nor any Oceaneering Affiliates, nor any officer,
employee or agent thereof has any agreement, arrangement or
understanding (whether written or oral) to make any payment,
contribution or gift to a Governmental Entity or third Person
that would, if applicable to such Person, constitute a violation
of the Foreign Corrupt Practices Act or any applicable Law nor is
any Diving Assumed Business Contract or Permit primarily related
to the Diving Business dependent on any such payment,
contribution or gift. Neither Oceaneering nor any Oceaneering
Affiliate is a "national" of a "designated foreign country"
(or a Person defined as a "designated foreign country") within
the definitions in the Foreign, Cuban or Iranian Assets Control
Regulations of the United States Treasury Department, 31 CFR,
Subtitle B, Chapter V, as amended, or any regulation or ruling
issued thereunder.
4.9 Litigation. Except as described in Schedule 4.9 to the
Oceaneering Disclosure Letter, there is no Action pending or, to
the knowledge of Oceaneering, threatened against or which
otherwise relates to the Diving Business Assets or the
transactions contemplated by this Agreement. Neither
Oceaneering, any Oceaneering Affiliates nor any of the Diving
Business Assets is subject to any outstanding order, writ,
injunction or decree that would have a Material Adverse Effect on
the ownership, use or value of the Diving Business Assets or
would prevent or delay the consummation of the transactions
contemplated hereby.
4.10 Brokers. Neither Oceaneering, the Oceaneering
Affiliates, nor any of their respective officers, directors or
employees has employed any financial advisor, broker or lender or
incurred any liability for any financial advisory, brokerage or
finder's fee or commission in connection with the transactions
contemplated hereby.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF GLOBAL
Global represents and warrants to Oceaneering as follows:
5.1 OrganizationError! Bookmark not defined.. Global, each
of the Global Affiliates and any other Affiliate of Global to
whom any of the Diving Business Assets are being transferred by
Oceaneering or any of the Oceaneering Affiliates, is a
corporation duly organized, validly existing and in good standing
under the Laws of its jurisdiction of incorporation.
5.2 Authorizations, Execution and ConsentsError! Bookmark
not defined..
(a) Global has full corporate power and authority to
execute and deliver this Agreement and the other Global
Documents to which it is a party and to carry out and
perform its obligations as provided herein and therein.
Each Global Affiliate has full corporate power and authority
to execute and deliver the Supplemental Asset Acquisition
Agreement to which it is a party and the other Global
Documents to which it is a party and to carry out and
perform its obligations as provided in the Supplemental
Asset Acquisition Agreement to which it is a party and the
other Global Documents to which it is a party.
(b) This Agreement, each Supplemental Asset
Acquisition Agreement and each of the other Global Documents
have been duly and validly authorized by all proper and
requisite corporate actions and duly executed and delivered
by Global and, where applicable, the Global Affiliate a
party thereto, and constitutes the legal, valid and binding
obligation of Global and, where applicable, the Global
Affiliate a party thereto, enforceable against Global and,
where applicable, the Global Affiliate a party thereto, in
accordance with its terms except to the extent that
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent
conveyance or transfer and similar laws affecting creditors'
rights and remedies generally and general privileges of
equity (regardless of whether enforcement is considered in a
proceeding at law or in equity).
(c) Except as set forth on Schedule 5.2 to the Global
Disclosure Letter, the execution and delivery of and
performance under this Agreement, the Supplemental Asset
Acquisition Agreements and the other Global Documents by
Global and, where applicable, the Global Affiliate a party
thereto and consummation of the transactions contemplated
hereby and thereby, (i) will not conflict with or breach any
provision of the certificate of incorporation, charter or
bylaws or similar organizational documents of Global or any
Global Affiliate or violate any Law, judgment, order, writ,
injunction or decree applicable to Global or any Global
Affiliate or any of the ROV Business Assets; (ii) will not
conflict with or breach or constitute any default (with or
without notice or lapse of time or both) under or give rise
to any rights of termination, cancellation or acceleration
under or result in or require the creation or imposition of
any Lien on any of the ROV Business Assets under, any
contract, agreement, permit or license to which Global or
any Global Affiliate is a party or by which Global or any
Global Affiliate is bound other than those that would not
have a Material Adverse Effect on the ROV Business Assets or
adversely affect the ability of Global or its Affiliates to
consummate the transactions contemplated by this Agreement
and the other Global Documents; (iii) will not require any
filing with, notification of or consent, approval or
authorization of any Governmental Entity or any third
Person.
5.3 Tax Matters
(a) All Taxes based upon, measured by, or arising by
reason of the ownership or operation of the ROV Business
Assets or sales resulting from the productive use of such
ROV Business Assets which have become due and payable have
been duly and timely paid, all applicable returns and
reports of or with respect to any Tax that are required to
be filed by or with respect to Global or any Global
Affiliate relating to the ROV Business Assets have been duly
and timely filed, and there is no claim pending or
threatened by any applicable taxing authority in connection
with any such Taxes, except for failures to pay or file and
claims that could not (i) have a Material Adverse Effect on
the ROV Business Assets or (ii) result in the imposition of
any Lien on any of the ROV Business Assets after the
Effective Time.
(b) There are no Liens for Taxes upon any of the ROV
Business Assets.
(c) There is not in force any extension of time with
respect to the due date for the filing of any Tax return or
Tax report of or with respect to any of the ROV Business
Assets or any waiver or agreement for any extension of time
for the assessment or payment of any Tax of or with respect
to any of the ROV Business Assets.
5.4 Title to Assets.
(a) Global or the Global Affiliates have, and upon
delivery of possession in the manner contemplated hereby
Oceaneering or its Affiliates will acquire, the ROV Business
Assets free and clear of all Liens. All of the ROV Business
Assets are owned legally and beneficially by Global or
Global Affiliates. Except for this Agreement and the
Supplemental Asset Acquisition Agreements, neither Global
nor any of the Global Affiliates is a party to any option,
purchase right or other contract or commitment that could
require them to sell, transfer or otherwise dispose of any
of the ROV Business Assets and, except for the ROV Business
Assumed Contracts, there is no lease, contract or other
agreement applicable to or binding upon any of the ROV
Business Assets.
(b) Oceaneering acknowledges that it has conducted to
its satisfaction an independent investigation and
verification of the assets of the ROV Business and, in
making its determination to proceed with the transactions
contemplated by this Agreement, Oceaneering has relied on
the results of its own independent investigation and the
representations and warranties of Global expressly and
specifically set forth in this Agreement. SUCH
REPRESENTATIONS AND WARRANTIES BY GLOBAL CONSTITUTE THE SOLE
AND EXCLUSIVE REPRESENTATIONS AND WARRANTIES OF GLOBAL TO
OCEANEERING IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED
HEREBY, AND OCEANEERING UNDERSTANDS, ACKNOWLEDGES AND AGREES
THAT ALL OTHER REPRESENTATIONS AND WARRANTIES OF ANY KIND OR
NATURE WHETHER EXPRESS, IMPLIED OR STATUTORY (INCLUDING
WITHOUT LIMITATION ANY RELATING TO THE FUTURE OR HISTORICAL
FINANCIAL CONDITION, RESULTS OF OPERATIONS, ASSETS OR
LIABILITIES OF THE ROV BUSINESS) ARE SPECIFICALLY DISCLAIMED
BY GLOBAL. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT,
NEITHER GLOBAL NOR ANY OF THE GLOBAL AFFILIATES MAKES ANY
WARRANTY OR COVENANT OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY. WITHOUT LIMITING THE GENERALITY OF THE
IMMEDIATELY PRECEDING SENTENCE, WITH RESPECT TO ANY OF THE
ROV BUSINESS ASSETS, EXCEPT AS EXPRESSLY PROVIDED FOR
HEREIN, GLOBAL, ON ITS OWN BEHALF AND ON BEHALF OF EACH OF
THE GLOBAL AFFILIATES, EXPRESSLY DISCLAIMS AND NEGATES:
(i) ANY IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY;
(ii) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE; (iii) ANY IMPLIED OR EXPRESS WARRANTY OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS OR FREEDOM FROM
PATENT INFRINGEMENTS; (iv) ANY IMPLIED OR EXPRESS WARRANTY
AS TO THE ACCURACY OF ANY OF THE INFORMATION FURNISHED WITH
RESPECT TO THE VALUE OF THE ROV BUSINESS ASSETS OR STATE OF
REPAIR THEREOF, IT BEING UNDERSTOOD THAT THE ROV BUSINESS
ASSETS ARE CONVEYED AS IS, WHERE IS AND WITH ALL FAULTS.
OCEANEERING ALSO ACKNOWLEDGES THAT ITS SOLE AND EXCLUSIVE
RECOURSE IN RESPECT OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT IS TO ASSERT ITS RIGHTS PURSUANT TO ARTICLE VII.
Global and Oceaneering agree that, to the extent required by
any applicable Law to be operative, the disclaimers of
warranties contained in this Section 4.4(b) are
"conspicuous" disclaimers.
5.5 Intellectual PropertyError! Bookmark not defined..
(a) Except as disclosed in Schedule 5.5 to the Global
Disclosure Letter:
(i) There are no unexpired U.S. and foreign
patents, pending patent applications and currently
active identified inventions which are owned by Global
or any of its Affiliates and which are necessary for
the operation of the ROV Business Assets in the manner
in which they have been operated in the last three
months or are currently being operated;
(ii) There are no agreements relating in any way
to the ROV Business Assets (x) under which royalties
presently are payable or may in the future become
payable or (y) which concern ownership, use or
disclosure of intellectual property, technology,
processes or proprietary information of any Person
relating to the ROV Business Assets;
(b) No Person has asserted that either Global or any
Affiliate of Global is infringing or has infringed within
the three years prior to the date hereof, any foreign or
domestic patent, trademark, service mark, trade name, or
copyright, or has misappropriated or improperly used or
disclosed any trade secret, confidential information or know
how in connection with the ROV Business Assets; and
(c) No operations of Global or any Global Affiliate
relating to the ROV Business Assets are infringing, or have
infringed within the three years prior to the date hereof,
any foreign or domestic patent, trademark, service mark,
trade name or copyright of any Person, or were involved in
any misappropriation or improper use or disclosure of any
trade secret, confidential information or know how of any
Person.
5.6 Contracts and CommitmentsError! Bookmark not defined..
True and correct copies of all ROV Business Assumed Contracts
have been provided to Oceaneering. All the ROV Business Assumed
Contracts are valid, binding and in full force and effect, have
not been amended or supplemented in any manner or respect except
as disclosed on Schedule 5.6 to the Global Disclosure Letter.
There are no defaults by Global or any Global Affiliate under any
ROV Business Assumed Contract, and, to the knowledge of Global
(a) there are no material defaults under any ROV Business Assumed
Contract by any other party thereto and (b) no events have
occurred that with the lapse of time or action or inaction by any
party thereto would result in any material defaults thereunder.
Except as disclosed in Schedule 5.6 to the Global Disclosure
Letter, the ROV Business Assumed Contracts may be assigned to
Oceaneering without any authorization, consent, approval,
permission or license of, or filing with, any other Person.
5.7 Licenses and Permits. The Permits listed in Schedule
1.1(d) to the Global Disclosure Letter constitute all the Permits
held by Global or any Global Affiliate that primarily relate to
the ROV Business and, except as set forth in Schedule 5.7 to the
Global Disclosure Letter, constitute all material Permits
necessary under applicable Laws, including applicable
Environmental Laws, for Global and the Global Affiliates to own,
operate, maintain and use the ROV Business Assets in the manner
in which they are now, and during the preceding 12 months have
been, operated, maintained and used. Each of such Permits and
the rights of Global or any Global Affiliate with respect thereto
are valid and subsisting, in full force and effect and
enforceable by Global or such Global Affiliate. Global or the
applicable Global Affiliate (depending on the holder thereof) is
now and has at all times in the past 12 months been in compliance
with the terms of such Permits except, in each case, where
failure to remain in compliance would not (i) have a Material
Adverse Effect on the ROV Business Assets or (ii) result in any
Lien on any of the ROV Business Assets after the Effective Time.
None of such Permits has been or, to the knowledge of Global, is
threatened to be revoked, canceled, suspended or modified.
5.8 Compliance with Law. Global and the Global Affiliates
have operated the ROV Business Assets in compliance with all
applicable Laws, including Environmental Laws, the Foreign
Corrupt Practices Act and the Export Administration Act and the
rules and regulations promulgated thereunder except, in each
case, where failure to comply would not have a Material Adverse
Effect on the ROV Business Assets. Neither Global nor any Global
Affiliates, nor any officer, employee or agent thereof has any
agreement, arrangement or understanding (whether written or oral)
to make any payment, contribution or gift to a Governmental
Entity or third Person that would, if applicable to such Person,
constitute a violation of the Foreign Corrupt Practices Act or
any applicable Law nor is any ROV Assumed Business Contract or
Permit primarily related to the ROV Business dependent on any
such payment, contribution or gift. Neither Global nor any
Global Affiliate is a "national" of a "designated foreign
country" (or a Person defined as a "designated foreign
country") within the definitions in the Foreign, Cuban or
Iranian Assets Control Regulations of the United States Treasury
Department, 31 CFR, Subtitle B, Chapter V, as amended, or any
regulation or ruling issued thereunder.
5.9 LitigationError! Bookmark not defined.. Except as
described in Schedule 5.9 to the Global Disclosure Letter, there
is no Action pending or, to the knowledge of Global, threatened
against or which otherwise relates to the ROV Business Assets or
the transactions contemplated by this Agreement. Neither Global,
any Global Affiliates nor any of the ROV Business Assets is
subject to any outstanding order, writ, injunction or decree that
would have a Material Adverse Effect on the ownership, use or
value of the ROV Business Assets or would prevent or delay the
consummation of the transactions contemplated hereby.
5.10 Brokers. Neither Global, the Global Affiliates, nor
any of their respective officers, directors or employees has
employed any financial advisor, broker or lender or incurred any
liability for any financial advisory, brokerage or finder's fee
or commission in connection with the transactions contemplated
hereby.
ARTICLE VI
COVENANTS
6.1 Actions of the Parties. after the Closing.
(a) Oceaneering will promptly give or file and will
cause each of the Oceaneering Affiliates to promptly give or
file any notices, applications or registration to third
Persons, and will use its reasonable efforts (and will cause
each Oceaneering Affiliate to use its reasonable efforts) to
obtain any consents, waivers or approvals set forth on
Schedule 4.2 or 4.6 to the Oceaneering Disclosure Letter.
Oceaneering will use reasonable efforts to promptly replace
and obtain the release of Global and any of its Affiliates
from any performance bonds, letters of credit, guarantees or
other credit or performance support related to any of the
ROV Business Assumed Contracts.
(b) Global will promptly give or file and will cause
each of the Global Affiliates to promptly give or file any
notices, applications or registration to third Persons, and
will use its reasonable efforts (and will cause each Global
Affiliate to use its reasonable efforts) to obtain any
consents, waivers or approvals set forth on Schedule 5.2 or
5.6 to the Global Disclosure Letter. Global will use
reasonable efforts to promptly replace and obtain the
release of Oceaneering and any of its Affiliates from any
performance bonds, letters of credit, guarantees or other
credit or performance support related to any of the Diving
Business Assumed Contracts.
6.2 Certain Employee Matters.
(a) From and after the date hereof, Oceaneering shall
permit Global to approach and negotiate with any or all
employees and agents of the Diving Business including, but
not limited to, managerial staff, in an effort to persuade
them to accept employment or agency with Global or its
Affiliates.
(b) From and after the date hereof until the Effective
Time, Global shall permit Oceaneering to approach and
negotiate with any or all employees and agents of the ROV
Business including, but not limited to, managerial staff, in
an effort to persuade them to accept employment or agency
with Oceaneering or its Affiliates.
(c) Global shall have no liability for, and
Oceaneering agrees to indemnify Global in accordance with
Article VII against any Action, liability, Losses or
obligations of Oceaneering or its Affiliates in each case
arising out of or relating to Oceaneering's termination of
their employment with it or any of its Affiliates. Without
limiting the scope of the preceding sentence, Oceaneering
shall take any and all actions necessary to ensure that
Global and its Affiliates shall not be required to provide
benefit coverage with respect to any such former employee
under the continuation of coverage provisions contained in
Section 4980B of the Code, Sections 601 through 608 of ERISA
or applicable state or foreign Laws.
(d) Oceaneering shall have no liability for, and
Global agrees to indemnify Oceaneering in accordance with
Article VII against any Action, liability, Losses or
obligations of Global or its Affiliates in each case arising
out of or relating to Global's termination of their
employment with it or any of its Affiliates. Without
limiting the scope of the preceding sentence, Global shall
take any and all actions necessary to ensure that
Oceaneering and its Affiliates shall not be required to
provide benefit coverage with respect to any such former
employee under the continuation of coverage provisions
contained in Section 4980B of the Code, Sections 601 through
608 of ERISA or applicable state or foreign Laws.
6.3 Protection of Value of Diving Business Assets. Because
of Oceaneering's access to the Diving Business' confidential
information and trade secrets, Oceaneering would be in a unique
position to divert business from the Diving Business and to
commit irreparable damage to the Diving Business were Oceaneering
to be allowed to compete with the Diving Business or to commit
any of the other acts prohibited by this Section 6.3;
Oceaneering acknowledges that the enforcement of said restrictive
covenants against Oceaneering will not impose any undue burden
upon Oceaneering, that none of said restrictive covenants is
unreasonable as to period or geographic area, and that the
ability to enforce said restrictive covenants against Oceaneering
is a material inducement to the decision of Global to consummate
the transactions contemplated in this Agreement. Oceaneering
acknowledges that Global would not purchase the Diving Business
Assets but for the agreements and covenants of Oceaneering
contained in this Section 6.3. Accordingly, Oceaneering
covenants and agrees as follows:
(a) Covenant. Oceaneering shall not, and will cause
its Affiliates not to, at any time prior to October 1, 2005,
(i) use any assets owned, leased or operated by Oceaneering
or any of its Affiliates to perform commercial diving
services (other than for the United States Navy or for ship
and marine vessel inspection, cleaning, repair and
maintenance) in the waters of Australia, New Zealand, India,
Egypt, South and Southeast Asia and China as well as the
Persian Gulf and the Red Sea, as more particularly set out
in Appendix III (the "Geographic Area"), or (ii) acquire
or maintain more than a one-third equity ownership or
profits interest in any Person (other than any special
purpose entity formed for the purpose of completing a single
contract or a series of related contracts with any customer
of Oceaneering or that special purpose entity) that
generates (A) at the time of the acquisition more than 12.5%
of its revenues or (B) at any time after such acquisition
through October 1, 2005, more than the greater of (1) 33% of
its revenues for any calendar year and (2) $5 million of
revenues for any calendar year, in the case of (A) or (B)
from commercial diving services (other than for the United
States Navy or for ship and marine inspection, cleaning,
repair, and maintenance) in the Georgraphic Area; provided,
however, that the foregoing shall not prohibit Oceaneering
or any of its Affiliates from subcontracting for commercial
diving services in the Geographic Area in connection with
any work performed for its customers; and provided, further,
that the foregoing provision shall not apply to any business
acquired by Oceaneering or any of its Affiliates after the
date hereof that has conducted diving services in the
Geographic Area during the 12 months preceding such
acquisition so long as (i) the total revenues of the
subsequently acquired business (taken together with any
related business acquired in the same transaction or a
series of related transactions (collectively, the
"Subsequently Acquired Business")) for the then most
recently completed period of 12 consecutive calendar months
that are attributable to commercial diving services in the
Geographic Area are less than 12.5% of the total revenues of
the Subsequently Acquired Business for that 12-month period
and (ii) the total consideration paid for the Subsequently
Acquired Business is equal to or exceeds $50 million.
(b) Solicitation of Business. Until October 1, 2005,
Oceaneering shall not, and will cause its Affiliates not to
solicit or assist any other Person to solicit to perform
commercial diving services in the Geographic Area other than
for Global or its Affiliates (except to the extent of the
exceptions set forth in clause (a) above).
(c) Confidential Information. From and after the date
of this Agreement, Oceaneering shall, and shall cause its
Affiliates to, keep secret and retain in strictest
confidence, and shall not, directly or indirectly, use in
the Geographic Area for the benefit of any Person other than
Oceaneering (including for this purpose, any Person who
controls Oceaneering), Global and their respective
Affiliates and customers all confidential matters and trade
secrets known relating to the Diving Business, including
customer lists, pricing policies, operational methods and
marketing plans or strategies, and shall not divulge,
disclose or make assessable to any Person outside of
Oceaneering (including for this purpose, any Person who
controls Oceaneering), Global and their respective
Affiliates any such information except upon Global's express
prior written consent.
(d) Rights and Remedies upon Breach. If Oceaneering
breaches, or threatens to commit a breach of, any of the
provisions of this Section 6.3, Global shall have the
following rights and remedies:
(i) the right and remedy to have the restrictive
covenants in this Section 6.3 specifically enforced by
any court having equity jurisdiction and Oceaneering
acknowledges and agrees that any such breach or
threatened breach will cause irreparable injury to
Global and that monetary damages will not provide an
adequate remedy to Global; and
(ii) the right and remedy to require Oceaneering
to indemnify Global against any losses, damages, costs
and expenses, including reasonable attorneys' fees and
court costs, which may be incurred by it and which
result from or arise out of or relate to any such
breach or threatened breach of the restrictive
covenants in this Section 6.3.
(e) Severability of Covenants. If any court of
competent jurisdiction determines that any of the
restrictive covenants in this Section 6.3, or any part
thereof, is invalid or unenforceable with respect to
Oceaneering, the remainder of the restrictive covenants in
this Section 6.3 shall not thereby be affected and shall be
given full effect, without regard to the invalid portions.
If any court of competent jurisdiction determines that any
of the restrictive covenants in this Section 6.3, or any
part thereof, is unenforceable because of the duration of
such provision or the area covered thereby, such court shall
have the power to reduce the duration or area of such
provision and, in its reduced form, such provision shall
then be enforceable and shall be enforced. Oceaneering
hereby waives any and all right to attack the validity of
the restrictive covenants in this Section 6.3 on the grounds
of the breadth of their geographic scope or the length of
their term.
(f) Enforceability in Jurisdictions. Each of
Oceaneering and Global intends to and does hereby consent to
and subject itself to the jurisdiction of the courts of any
jurisdiction within the Geographic Area to enforce the
restrictive covenants in this Section 6.3. If the courts of
any one or more of such jurisdictions hold the restrictive
covenants in this Section 6.3 unenforceable by reason of the
breadth of such scope or otherwise, it is the intention of
Global and Oceaneering that such determination not bar or in
any way affect the right of Global to the relief provided
above in the courts of any other jurisdiction within the
geographical scope of such covenants, as to breaches of such
covenants in such other respective jurisdictions, such
covenants as they relate to each jurisdiction being, for
this purpose, severable into diverse and independent
covenants.
6.4 Protection of Value of ROV Purchased Assets. Because
of Global's access to the ROV Business' confidential information
and trade secrets, Global would be in a unique position to divert
business from the ROV Business and to commit irreparable damage
to the ROV Business were Global to be allowed to compete with the
ROV Business or to commit any of the other acts prohibited by
this Section 6.4; Global acknowledges that the enforcement of
said restrictive covenants against Global will not impose any
undue burden upon Global, that none of said restrictive covenants
is unreasonable as to period or geographic area, and that the
ability to enforce said restrictive covenants against Global is a
material inducement to the decision of Oceaneering to consummate
the transactions contemplated in this Agreement. Global
acknowledges that Oceaneering would not purchase the ROV Business
Assets but for the agreements and covenants of Global contained
in this Section 6.4. Accordingly, Global covenants and agrees as
follows:
(a) Covenant. Global shall not, and will cause its
affiliates not to, at any time prior to October 1, 2005, (i)
use any assets owned, leased or operated by Global or any of
its Affiliates to perform ROV Services in the Geographic
Area or (ii) acquire or maintain more than a one-third
equity ownership or profits interest in any Person (other
than any special purpose entity formed for the purpose of
completing a single contract or a series of related
contracts with any customer of Global or that special
purpose entity) that generates (A) at the time of the
acquisition more than 12.5% of its revenues or (B) at any
time after such acquisition through October 1, 2005, more
than the greater of (1) 33% of its revenues for any calendar
year and (2) $5 million of revenues for any calendar year,
in the case of (A) or (B) from ROV Services in the
Georgraphic Area; provided, however, that the foregoing
shall not prohibit Global or any of its Affiliates from
subcontracting for ROV Services in the Geographic Area in
connection with any work performed for its customers, and
provided, further, that the foregoing provision shall not
apply to any business acquired by Global or any of its
Affiliates after the date hereof that has conducted ROV
Services in the Geographic Area during the 12 months
preceding such acquisition so long as (i) the total revenues
of the subsequently acquired business (taken together with
any related business acquired in the same transaction or a
series of related transactions (collectively, the
"Subsequently Acquired Business")) for the then most
recently completed period of 12 consecutive calendar months
that are attributable to ROV Services in the Geographic Area
are less than 12.5% of the total revenues of the
Subsequently Acquired Business for that 12-month period and
(ii) the total consideration paid for the Subsequently
Acquired Business is equal to or exceeds $50 million.
(b) Solicitation of Business. Until October 1, 2005,
Global shall not, and will cause its Affiliates not to,
solicit or assist any other Person to solicit to perform ROV
Services in the Geographic Area other than for Oceaneering
or its Affiliates (except to the extent of the exceptions
set forth in clause (a) above).
(c) Confidential Information. From and after the date
of this Agreement, Global shall, and shall cause its
Affiliates to, keep secret and retain in strictest
confidence, and shall not, directly or indirectly, use in
the Geographic Area for the benefit of any Person other than
Global (including for this purpose, any Person who controls
Global), Oceaneering and their respective Affiliates and
customers all confidential matters and trade secrets known
relating to the ROV Business, including customer lists,
pricing policies, operational methods and marketing plans or
strategies, and shall not divulge, disclose or make
assessable to any Person outside of Global (including for
this purpose, any Person who controls Global), Oceaneering
and their respective Affiliates any such information except
upon Oceaneering's express prior written consent.
(d) Rights and Remedies upon Breach. If Global
breaches, or threatens to commit a breach of, any of the
provisions of this Section 6.4, Oceaneering shall have the
following rights and remedies:
(i) the right and remedy to have the restrictive
covenants in this Section 6.4 specifically enforced by
any court having equity jurisdiction and Global
acknowledges and agrees that any such breach or
threatened breach will cause irreparable injury to
Oceaneering and that monetary damages will not provide
an adequate remedy to Oceaneering; and
(ii) the right and remedy to require Global to
indemnify Oceaneering against any losses, damages,
costs and expenses, including reasonable attorneys'
fees and court costs, which may be incurred by it and
which result from or arise out of or relate to any such
breach or threatened breach of the restrictive
covenants in this Section 6.4.
(e) Severability of Covenants. If any court of
competent jurisdiction determines that any of the
restrictive covenants in this Section 6.4, or any part
thereof, is invalid or unenforceable with respect to Global,
the remainder of the restrictive covenants in this Section
6.4 shall not thereby be affected and shall be given full
effect, without regard to the invalid portions. If any court
of competent jurisdiction determines that any of the
restrictive covenants in this Section 6.4, or any part
thereof, is unenforceable because of the duration of such
provision or the area covered thereby, such court shall have
the power to reduce the duration or area of such provision
and, in its reduced form, such provision shall then be
enforceable and shall be enforced. Global hereby waives any
and all right to attack the validity of the restrictive
covenants in this Section 6.4 on the grounds of the breadth
of their geographic scope or the length of their term.
(f) Enforceability in Jurisdictions. Each of
Oceaneering and Global intends to and does hereby consent to
and subject itself to the jurisdiction of the courts of any
jurisdiction within the Geographic Area to enforce the
restrictive covenants in this Section 6.4. If the courts of
any one or more of such jurisdictions hold the restrictive
covenants in this Section 6.4 unenforceable by reason of the
breadth of such scope or otherwise, it is the intention of
Global and Oceaneering that such determination not bar or in
any way affect the right of Oceaneering to the relief
provided above in the courts of any other jurisdiction
within the geographical scope of such covenants, as to
breaches of such covenants in such other respective
jurisdictions, such covenants as they relate to each
jurisdiction being, for this purpose, severable into diverse
and independent covenants.
6.5 Assignment of Contracts. To the extent that the
assignment of any Diving Business Assumed Contract or ROV
Business Assumed Contract shall require the consent of any other
Person, this Agreement shall not constitute an agreement to
assign the same if the attempted assignment would constitute a
breach thereof. Oceaneering and Global agree each to use
reasonable efforts in each case to obtain such consent to the
assignment as promptly as possible. If any such required consent
is not obtained, the parties hereto will cooperate in any
reasonable arrangement designed to provide for the assigning
party the benefit of such Diving Business Assumed Contract or ROV
Business Assumed Contract which it is denied or deprived of as a
result of the failure to obtain such consent. Such "reasonable
arrangement" may include subcontracting to perform obligations
under the applicable Diving Business Assumed Contract or ROV
Business Assumed Contract on terms substantially similar to the
Diving Business Assumed Contract or ROV Business Assumed
Contract.
6.6 Taxes and Expenses.
(a) Each party shall pay or cause to be paid all Taxes
incurred by it or its Affiliates arising out of or in
connection with the transactions effected pursuant to this
Agreement or any of the Supplemental Asset Acquisition
Agreements and all Transfer Taxes related to property or
assets transferred by it.
(b) Oceaneering shall pay or cause Oceaneering
Affiliates to pay all Taxes with respect to the Diving
Business and the Diving Business Assets that are payable or
become payable after the date hereof with respect to periods
ending on or prior to the Effective Time (irrespective of
when the relevant Tax period ends). Global shall pay all
Taxes with respect to the ROV Business and ROV Business
Assets that are payable or become payable with respect to
periods ending on or prior to the Effective Time
(irrespective of when the relevant Tax period ends).
Subject to Section 6.8, the determination of the portion of
any Taxes payable with respect to periods on or prior to the
Effective Time shall be made, in the case of ad valorem,
property or similar Taxes, by allocating such Taxes on a per
diem basis, and, in the case of all other Taxes, by assuming
that the period on or prior to the Effective Time
constitutes a separate taxable period and by taking into
account the actual taxable events occurring during such
period.
(c) Except as may otherwise be specifically provided
herein, each party shall be responsible for its own
expenses, including without limitation the fees of
accountants and attorneys, which are incurred in connection
with the negotiation and execution of this Agreement and the
consummation of the transactions herein contemplated.
6.7 Access to Records After Closing. Oceaneering and
Global agree that, so long as any of the books and records
retained by Oceaneering and any Oceaneering Affiliate relating to
the Diving Business Assets or retained by Global and any Global
Affiliate relating to the ROV Business Assets remain in
existence, the other party shall have the right to inspect and,
at its expense, to make copies of the same at any time during
business hours for any proper purpose upon written request
therefor stating with reasonable particularity the books or
records to which access is sought provided that such access does
not violate any confidentiality obligation of the party
possessing such books and records or result in the loss or waiver
of any privilege to refuse to disclose such information in any
Action, with any determination as to whether the provisions of
any such requested information would result in such a violation,
loss or waiver to be made on a reasonable basis by the party from
whom the information is requested. For a period of five years
following the date of this Agreement, the parties hereto will
not, without first having offered to deliver the same to the
other party, destroy or permit the destruction of any of such
books and records. Notwithstanding the foregoing, the parties
shall not have any obligation to make available or provide copies
to each other of any consolidated, combined, unitary or similar
Tax return or report filed by such party or any of its
Affiliates, or any related material.
6.8 Allocation of Revenues from Assumed Contracts. The
parties shall allocate all amounts paid under each Diving
Business Assumed Contract and ROV Business Assumed Contract which
is not a "day rate" contract based upon the percentage-of-
completion of each such contract at the Effective Time. With
respect to contracts referenced in the preceding sentence (a) if
invoices sent prior to the Effective Time, together with payments
received by the party assigning the contract exceed the total
payments to be made under the contract multiplied by the
percentage-of-completion (calculated in accordance with U.S.
generally accepted accounting principles) at the Effective Time,
then such party shall within 30 days of the Effective Time pay to
the party assuming the contract an amount in U.S. dollars equal
to such excess, and (b) if invoices sent prior to the Effective
Time, together with payments received by the party assigning the
contract are less than the total payments to be made under the
contract multiplied by the percentage-of-completion (calculated
in accordance with U.S. generally accepted accounting principles)
at the Effective Time, then the assuming party shall within 30
days of receipt of payment pay to the assuming party an amount in
U.S. dollars equal to such shortfall. In the case of Diving
Business Assumed Contracts and ROV Business Assumed Contracts
that are "day rate" contracts, payments attributable to work
days prior to the Effective Time shall be paid over to or
retained by the assigning party and payments attributable to work
days after the Effective Time shall be paid over to or retained
by the assuming party. The parties shall use their best efforts
to cause the income from such contracts to be allocated for Tax
purposes to periods on or prior to the Effective Time in a manner
consistent with this Section 6.8.
6.9 Transition Assistance.
(a) To provide for a smooth transition of the Diving
Business Assets operations to Global, Oceaneering agrees (to
the extent it may do so without violating any applicable
lease, license or other agreement) to provide during the 30
days after the Effective Time general administration
services, including accounting, invoicing, information and
data processing systems (together with the personnel
necessary to provide such service) in connection with the
Diving Business to the extent requested by Global and
reasonably necessary to prevent disruptions in the provision
of services to customers and suppliers and the employment
and payment of employees and agents. Global will promptly
reimburse Oceaneering for all out-of-pocket costs incurred
in connection with providing these services.
(b) To provide for a smooth transition of the ROV
Business Assets operations to Oceaneering, Global agrees (to
the extent it may do so without violating any applicable
lease, license or other agreement) to provide during the 30
days after the Effective Time general administration
services, including accounting, invoicing, information and
data processing systems (together with the personnel
necessary to provide such service) in connection with the
ROV Business to the extent requested by Oceaneering and
reasonably necessary to prevent disruptions in the provision
of services to customers and suppliers and the employment
and payment of employees and agents. Oceaneering will
promptly reimburse Global for all out-of-pocket costs
incurred in connection with providing these services.
6.10 Facility Arrangements and ROV Services Agreement.
(a) From and after the Closing, the parties hereto
will, and (where applicable) will cause their respective
Affiliates to, (i) negotiate and document mutually
acceptable (A) lease assignments with respect to the Diving
Business Transferred Facilities and (B) leases, subleases or
other appropriate facility sharing arrangements with respect
to the Diving Business Shared Facilities and the ROV
Business Shared Facility and (ii) use reasonable efforts to
obtain all consents of the lessors (where applicable) of
those respective facilities as are necessary to give full
force and effect to each such lease assignment, lease,
sublease or other facility sharing arrangement.
(b) With respect to each Diving Business Transferred
Facility, until such time as a lease assignment (as
contemplated by Section 6.10(a)) pertaining to that facility
becomes effective, Global will (i) reimburse Oceaneering and
its Affiliates for any costs or expenses they incur with
respect to that facility (A) pursuant to pre-existing lease
obligations (including, without limitation, rent), (B) for
operating costs of the facility, or (C) at the request of
Global, in each case within 30 days after receipt of an
invoice therefor accompanied by reasonable evidence of the
amount and payment of such sum, and (ii) indemnify and hold
harmless Oceaneering and its Affiliates from and against any
and all Losses of any kind or nature whatsoever (including,
without limitation, Losses which may be incurred by
Oceaneering or any of its Affiliates, agents, employees or
invitees) arising out of, resulting from or otherwise
relating to any use or possession of any of the Diving
Business Transferred Facilities after the Effective Time.
(c) With respect to the Diving Business Shared
Facilities and the ROV Business Shared Facility, the general
terms that will be applicable to the respective leases,
subleases or other facility sharing arrangements are as set
forth on Exhibit 6.10(c)(i) hereto and certain of the
specific terms that will be applicable to those leases,
subleases or facility sharing arrangements are as set forth
in Exhibit 6.10(c)(ii).
(d) With respect to each of the Diving Business Shared
Facilities and the ROV Business Shared Facility, to the
extent permitted by the existing lease relating to that
facility (if any), the parties or their respective
Affiliates will commence the sharing of the facility
contemplated by this Section 6.10 (and Exhibits 6.10(c)(i)
and (ii) hereto) immediately following the Effective Time
and, until such time as a lease, sublease or other
appropriate facility sharing arrangement (as contemplated by
Section 6.10(a)) pertaining to that facility becomes
effective, the parties hereto will, or (where applicable)
will cause their respective Affiliates to, comply, to the
greatest extent possible, with the terms set forth in
Exhibit 6.10(c)(i) hereto and the applicable terms set forth
in Exhibit 6.10(c)(ii) hereto (including, without limitation
the payment of rent, provision of the indemnification and
termination rights set forth therein).
(e) From and after the Closing, the parties hereto
will, and (where applicable) will cause their respective
Affiliates to, negotiate and document a mutually acceptable
ROV Services Agreement providing for the provision of ROV
Services to Global and its Affiliates in the Geographic Area
on the terms and conditions set forth in Exhibit 6.10(e).
6.11 Preferred Provider. Until October 1, 2005 Oceaneering
agrees that Global and its Affiliates shall be the preferred
provider of commercial diving services to Oceaneering and its
Affiliates in the Geographic Area and in accordance with this
status, Oceaneering will use reasonable efforts to ensure that
Global or its Affiliates will be given an opportunity to provide
commercial diving services to, or in connection with, any project
controlled by or awarded to, Oceaneering or its Affiliates in the
Geographic Area. In those circumstances where Oceaneering or its
Affiliates are in a position to influence the selection of the
provider of commercial diving services to be used on a specific
project in the Geographic Area, and where Global is willing and
able to supply commercial diving services for such project,
Oceaneering agrees to, and to cause its Affiliates to, recommend
the use of Global's commercial diving services for such project.
Further, Global and Oceaneering agree to cooperate in the
Geographic Area to pursue joint opportunities for their
respective businesses.
6.12 Further Assurances.
(a) After the Closing, and for no further
consideration, Oceaneering shall, and shall cause each of
the Oceaneering Affiliates to, perform all acts and execute,
acknowledge and deliver such additional assignments,
transfers, consents and other documents and instruments as
Global may reasonably request, in each case, to vest in
Global or its Affiliates and to protect Global or its
Affiliates' right, title and interest in, and enjoyment of,
the Diving Business Assets free of any Liens.
(b) After the Closing, and for no further
consideration, Global shall, and shall cause each of the
Global Affiliates to, perform all acts and execute,
acknowledge and deliver such additional assignments,
transfers, consents and other documents and instruments as
Oceaneering may reasonably request, in each case, to vest in
Oceaneering or its Affiliates and to protect Oceaneering or
its Affiliates' right, title and interest in, and enjoyment
of, the ROV Business Assets free of any Liens.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
7.1 Survival of Representations. The representations and
warranties of the parties or of their Affiliates set forth in
this Agreement or in any other Oceaneering Document or Global
Document shall survive the Closing, notwithstanding any
investigations or on behalf of any of the parties hereto or any
of their respective Affiliates; provided that (i) the
representations and warranties set forth in Sections 4.9 and 5.9
shall survive until the third anniversary of the date of this
Agreement and shall then expire, (ii) the representations and
warranties set forth in Sections 4.3 and 5.3 shall survive until
expiration of the applicable statutes of limitations or the time
within which claims relating to the underlying matters covered by
such representations and warranties shall have expired and shall
then expire, (iii) the representations and warranties set forth
in Sections 4.2, 4.4(a), 5.2 and 5.4(a) shall survive
indefinitely and (iv) all other representations and warranties of
the parties or their Affiliates in this Agreement or in any other
Oceaneering Document or Global Document shall survive until the
first anniversary of the date of this Agreement and shall then
expire. Upon the expiration of any representation and warranty
pursuant to this Section 7.1, unless written notice of a claim
based on such representation and warranty shall have been
delivered to the Indemnitee prior to such expiration, no claim
may be brought based on the breach of such representation and
warranty.
7.2 Indemnity.
(a) Subject to the provisions of this Article VII,
Oceaneering shall indemnify and hold Global and its
directors, officers, employees and Affiliates ("Global
Indemnitees") harmless from and against any Losses of any
kind or nature whatsoever, which may be incurred or suffered
by any of the Global Indemnitees and which may arise out of,
result from, or be based upon:
(i) any breach of or inaccuracy in any
representation or warranty of Oceaneering made in this
Agreement or of Oceaneering or any of its Affiliates
made in any of the other Oceaneering Documents;
(ii) the failure of Oceaneering or any Oceaneering
Affiliate to perform the covenants and obligations
imposed on it by this Agreement or by the other
Oceaneering Documents;
(iii) the failure of Oceaneering or any of the
Oceaneering Affiliates to deliver to and vest in Global
or its Affiliates all of their right, title and
interest in and to the Diving Business Assets;
(iv) any obligation or liability of Oceaneering or
any of its Affiliates arising out of the transactions
hereunder except for the obligations and liabilities
arising after the Effective Time under the Diving
Business Assumed Contracts;
(v) the ownership, management, operation or use
by Oceaneering or the Oceaneering Affiliates of any of
the Diving Business Assets or the conduct of the Diving
Business by Oceaneering or any of the Oceaneering
Affiliates prior to the Effective Time, including
warranty claims for work performed prior to the
Effective Time regardless of whether the job or the
contract under which such work was performed was
completed prior to or after the Effective Time;
(vi) the ownership, management, operation or use
by Oceaneering or any of its Affiliates of any of the
ROV Business Assets after the Effective Time; and
(vii) the failure of Oceaneering or its
Affiliates to pay, perform or discharge when due
obligations arising after the Effective Time under the
ROV Business Assumed Contracts.
(b) Subject to the provisions of this Article VII,
Global shall indemnify and hold Oceaneering and its
directors, officers, employees and Affiliates ("Oceaneering
Indemnitees") harmless from and against any Losses of any
kind or nature whatsoever, which may be incurred or suffered
by any of the Oceaneering Indemnitees and which may arise
out of, result from, or be based upon:
(i) any breach of or inaccuracy in any
representation or warranty of Global made in this
Agreement or of Global or any of its Affiliates made in
any of the other Global Documents;
(ii) the failure of Global or any Global Affiliate
to perform the covenants and obligations imposed on it
by this Agreement or by the other Global Documents;
(iii) the failure of Global or any of the
Global Affiliates to deliver to and vest in Oceaneering
and its Affiliates all of their right, title and
interest in and to the ROV Business Assets;
(iv) any obligation or liability of Global or any
of its Affiliates arising out of the transactions
hereunder, except for the obligations and liabilities
arising after the Effective Time under the ROV Business
Assumed Contracts;
(v) the ownership, management, operation or use
by Global or the Global Affiliates of any of the ROV
Business Assets or the conduct of the ROV Business by
Global or any of the Global Affiliates prior to the
Effective Time, including warranty claims for work
performed prior to the Effective Time regardless of
whether the job or the contract under which such work
was performed was completed prior to or after the
Effective Time;
(vi) the ownership, management, operation or use
by Global or any of its Affiliates of any of the Diving
Business Assets after the Effective Time; and
(vii) the failure of Global or its Affiliates
to pay, perform or discharge when due obligations
arising after the Effective Time under the Diving
Business Assumed Contracts.
7.3 Notice and Participation.
(a) If a claim, demand or Action is asserted by a
third Person against any Person indemnified pursuant to this
Article VII (each an "Indemnitee"), and if such Indemnitee
intends to seek indemnity with respect thereto under this
Article VII (which claim, demand or Action is herein called
a "Third Party Claim"), the Indemnitee shall promptly, and
in any event within 15 days of the assertion of such Third
Party Claim, deliver notice (a "Claim Notice") to each
Person from whom indemnification is sought (the
"Indemnitor") for such Third Party Claim which notice
shall (i) state with reasonable particularity the nature of
the Third Party Claim, (ii) set forth an estimate of the
amount of damages or other Losses attributable to the Third
Party Claim to the extent feasible (which estimate shall not
be conclusive of the final amount of that claim) and the
basis for the Indemnitee's request for indemnification under
this Agreement and (iii) attach a copy of all papers served
with respect to that Third Party Claim (if any). Except as
set forth in the last sentence of Section 7.1, the failure
to promptly deliver a Claim Notice to the Indemnitor shall
not relieve the Indemnitor of any obligation which the
Indemnitor might have to the Indemnitee with respect to the
related Third Party Claim except to the extent (and only to
the extent) such failure prejudices the Indemnitor's defense
of the Third Party Claim. In the event of any Third Party
Claim, Indemnitor, at its option, may assume (with legal
counsel reasonably acceptable to the Indemnitee) at its sole
cost and expense the defense of any Third Party Claim by
written notice to the Indemnitee within 30 days after
receipt of any Claim Notice if (i) it acknowledges to the
Indemnitee in writing its obligations to indemnify the
Indemnitee with respect to all elements of such Third Party
Claim, and (ii) the Third Party Claim involves only money
damages and does not seek injunctive or equitable relief;
provided that Indemnitee shall have the right at its own
expense to participate jointly with, but not control,
Indemnitor in the defense of any such Third Party Claim. If
Indemnitor elects to undertake the defense of any Third
Party Claim hereunder, Indemnitee shall cooperate with
Indemnitor in the defense or settlement of the Third Party
Claim. The Indemnitor shall not without the prior written
consent of the Indemnitee (which consent shall not be
unreasonably withheld or delayed) be entitled to settle any
Third Party Claim or consent to the entry of any judgment
which does not include as an unconditional term thereof the
giving by the claimant or the plaintiff to the Indemnitee of
an unconditional release from all liability in respect of
such Third Party Claim.
(b) If the Indemnitor, by the thirtieth day after
receipt of any Claim Notice in regards to a Third Party
Claim (or, if earlier, by the tenth day preceding the day on
which an answer or other pleading must be served in order to
prevent judgment by default in favor of the person asserting
the Third Party Claim) does not acknowledge its obligation
to indemnify Indemnitee, fails to notify the Indemnitee that
the Indemnitor elects to defend the Indemnitee or elects to
defend the Indemnitee but fails to prosecute actively and in
good faith the defense of such Third Party Claim, the
Indemnitee may defend against and control the proceedings
regarding such claim, and the Indemnitor shall be entitled
to participate in (but not control) the defense of such
action, with its counsel and at its own expense. The
Indemnitee shall not settle or compromise any Third Party
Claim for which it is entitled to indemnification hereunder,
without the prior written consent of the Indemnitor (which
consent shall not be unreasonably withheld or delayed).
Notwithstanding the foregoing, if the Indemnitor has
delivered a written notice to the Indemnitee to the effect
that the Indemnitor disputes its potential liability to the
Indemnitee under this Article VII and if that dispute is
resolved in favor of the Indemnitor, the Indemnitor shall
not be required to bear the costs and expenses of the
Indemnitee's defense pursuant to this Section 7.3 or of the
Indemnitor's participation therein at the Indemnitee's
request, and the Indemnitee shall reimburse the Indemnitor
in full for all reasonable costs and expenses of such
litigation.
(c) If any Indemnitee believes there exists any claim
(other than a claim that involves a Third Party Claim) with
respect to which any Indemnitor is obligated to provide
indemnification pursuant to Section 7.1(a) or 7.1(b), or
pursuant to any other specific indemnification covenant
contained in this Agreement, the Indemnitee shall give the
Indemnitor written notice thereof (an "Indemnity Notice")
which notice shall state with reasonable particularity the
circumstances giving rise to such Claim and shall specify,
if known, the amount of the Losses for which indemnification
is sought. Any such claim shall be conclusive against the
Indemnitor in all respects 60 days after receipt by the
Indemnitor of the Indemnity Notice with respect thereto in
accordance with this Section 7.3(c), unless within such
period the Indemnitor sends the Indemnitee a notice
disputing the propriety of the claim. Such notice of
dispute shall describe the basis for such objection and the
amount of the claim as to which the Indemnifying Party does
not believe should be subject to indemnification. If the
Indemnitor disputes that claim, that dispute shall be
resolved by proceedings in an appropriate court of competent
jurisdiction if the parties do not reach a settlement of
that dispute within 60 days after written notice of that
dispute is given by the Indemnitor.
7.4 Indemnification of Negligence of Indemnitee. The
indemnification provided in this Article VII shall be
applicable whether or not the Losses are contributed to
by the negligence or fault of the Indemnitee.
7.5 Indemnification Threshold and Limitations; Exclusive
Remedy. Except in cases of fraud, knowing or willing
misrepresentation or gross negligence, (a) neither the Global
Indemnitees on the one hand, nor the Oceaneering's Indemnitees on
the other hand shall be entitled to make any claim for
indemnification under Section 7.2(a)(i) or 7.2(b)(i),
respectively, unless and until the aggregate of all Losses
suffered by them and for which indemnification under such
provision is sought exceeds $50,000, and in such event such
Person shall be entitled to indemnification only for the amount
of Losses in excess of the $50,000 threshold, (b) Oceaneering
shall not have any obligation under Sections 7.2(a)(i) and (ii)
in respect of Losses in excess of $5,000,000, and in no event
shall Oceaneering be responsible or liable to Global hereunder in
respect of any Losses that are, in the nature of cost of money,
loss of use of capital or revenue or damage to reputation or any
special, punitive or consequential damages, (c) Global shall not
have any obligation under Sections 7.2(b)(i) and (ii) in respect
of Losses in excess of $5,000,000, and in no event shall Global
be responsible or liable to Oceaneering hereunder in respect of
any Losses that are, in the nature of cost of money, loss of use
of capital or revenue or damage to reputation or any special,
punitive or consequential damages. Except as provided in
Sections 6.3(d) and 6.4(d), the remedies provided in this
Article VII shall be the exclusive remedy for damages (whether at
law or in equity) and other Losses with respect to claims
resulting from or relating to any misrepresentation, breach of
warranty or failure to perform any covenant or agreement
contained in this Agreement or otherwise relating to the
transactions that are the subject of this Agreement.
7.6 Payment. Payments of all amounts owing by an
Indemnitor pursuant to this Article VII relating to a Third Party
Claim shall be made within five Business Days after (i) the
settlement of that Third Party Claim, (ii) the expiration of the
period for appeal of a final adjudication of that Third Party
Claim or (iii) if Indemnitor has not previously acknowledged in
writing its obligation to indemnify the Indemnitee, the
expiration of the period for appeal of a final adjudication of
the Indemnitor's liability to the Indemnitee under this Agreement
in respect of that Third Party Claim. Payments of all other
amounts owing by an Indemnitor hereunder shall be made at such
time as the Indemnitee and the Indemnitor shall mutually agree,
but in any event within five Business Days after the expiration
of the period for appeal of a final adjudication of the
Indemnitor's liability to the Indemnitee under this Agreement in
cash in U.S. Dollars, together with interest from the date that
the Indemnitee initially requested such payment until the date of
actual payment, at an annual rate equal to the prime interest
rate then generally in effect on the date of payment as set forth
in The Wall Street Journal.
ARTICLE VIII
MISCELLANEOUS
8.1 Waivers and Amendments. Any waiver of any term or
condition of this Agreement, or any amendment or modification of
this Agreement, shall be effective only if set forth in a written
document executed by a duly authorized officer of each of the
parties hereto. Except as otherwise provided herein, no delay or
omission in the exercise of any right, power or remedy accruing
to any party hereto as a result of any breach or default
hereunder by any other party hereto shall impair any such right,
power or remedy, nor shall it be construed, deemed or interpreted
as a waiver of or acquiescence in any such breach or default, or
of any similar breach or default occurring later, nor shall any
waiver of any single breach or default be construed, deemed or
interpreted as a waiver of any other breach or default hereunder
occurring before or after that waiver.
8.2 Notices. Any notice, request, instruction, demand or
other communication to be given hereunder by either party hereto
to the other shall be given in writing and shall be delivered
either by hand, by telegram, telex, telecopy or similar facsimile
means, or by registered or certified mail, postage prepaid,
return receipt requested, as follows:
(a) If to Global, addressed to:
Global Industries, Ltd.
8000 Global Drive
Carlyss, LA 70665
Attention: Peter Atkinson
Telecopy No: 337-583-5010
With copy to:
Russell Robicheaux
Vice President and General Counsel
Global Industries, Ltd.
8000 Global Drive
Carlyss, LA 70665
Telecopy No: 337-583-5010
(b) If to Oceaneering, addressed to:
Oceaneering International, Inc.
11911 FM 529
Houston, TX 77041
Attention: T. Jay Collins
Telecopy No: (713) 329-4654
With a copy to:
George R. Haubenreich, Jr.
Senior Vice President, General
Counsel and Secretary
Oceaneering International, Inc.
11911 FM 529
Houston, TX 77041
Telecopy No: 713-329-4654
or to such other address or number as either party shall have
previously designated by written notice given to the other party
in the manner herein above set forth. Notices shall be deemed
given when received, if sent by telegram, telex, telecopy or
similar facsimile means, and when delivered and receipted for, if
mailed or hand delivered.
8.3 Headings; Article and Section References. The Article
and Section headings herein are for convenience only and shall
not affect the meaning or construction of any provision hereof.
Unless otherwise specified, all references to Articles or
Sections in this Agreement refer to Articles and Sections of this
Agreement.
8.4 Entire Agreement. This Agreement, the Oceaneering
Disclosure Letter, the Global Disclosure Letter, the Supplemental
Asset Acquisition Agreements, the Appendices hereto, the other
Oceaneering Documents and the other Global Documents constitute
the entire agreement between the parties pertaining to the
subject matter hereof and supersede all other prior and
contemporaneous agreements and understandings, both oral and
written, of the parties in connection therewith. No covenant or
condition not expressed in this Agreement shall be effective to
interpret, change or restrict this Agreement.
8.5 Severability. If any provision of this Agreement is
held by any court of competent jurisdiction to be invalid, void
or unenforceable in any respect, the remainder of such provision
shall, to the extent possible, be modified in such manner as to
be valid, legal and enforceable but so as to most nearly retain
the intent of the parties hereto as expressed herein, and if such
a modification is not possible, that provision shall be severed
from this Agreement, and in either case the validity, legality
and enforceability of the remaining provisions of this Agreement
shall not in any way be affected or impaired thereby.
8.6 Public Announcements. Neither of the parties hereto,
except as required by any Law, Governmental Entity or stock
exchange rule, shall release to the public any information
concerning this Agreement or the transactions contemplated
hereby, without having first obtained the approval of the other
parties hereto, which approval may not be unreasonably withheld.
8.7 Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF TEXAS WITHOUT REFERENCE TO ANY CHOICE OF LAW PRINCIPLES
THEREOF THAT WOULD CAUSE THE LAWS OF ANOTHER JURISDICTION TO
APPLY.
8.8 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Neither
Oceaneering nor Global may assign this Agreement or (except as
provided in Section 8.11) its rights hereunder (except by
operation of law) without the express prior written consent of
the other party hereto. Neither this Agreement nor any
Supplemental Asset Acquisition Agreement is intended, or shall be
construed, deemed or interpreted, to confer on any person not a
party hereto or thereto any rights or remedies hereunder or
thereunder, except as provided in Article VII or as otherwise
provided expressly herein or therein.
8.9 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
8.10 Risk of Loss.
(a) The risk of any loss, damage, impairment,
confiscation or condemnation of the Diving Business Assets,
or any part thereof, shall be upon Global and the Global
Affiliates at all times after the Effective Time.
(b) The risk of any loss, damage, impairment,
confiscation or condemnation of the ROV Business Assets, or
any part thereof, shall be upon Oceaneering and the
Oceaneering Affiliates at all times after the Effective
Time.
8.11 Transfer of Certain Assets.
(a) Global may cause Oceaneering to transfer to one or
more of Global's Affiliates at the Closing all of the Diving
Business Assets to be sold, conveyed, transferred, assigned
and delivered to Global hereunder. Any such transfers shall
be to Affiliates of Global designated by Global, and such
designation shall not relieve Global from any of its
obligations under this Agreement provided that such
designation does not increase any Taxes otherwise payable by
Oceaneering.
(b) Oceaneering may cause Global to transfer to one or
more of Oceaneering's Affiliates at the Closing all of the
ROV Business Assets to be sold, conveyed, transferred,
assigned and delivered to Oceaneering hereunder. Any such
transfers shall be to Affiliates of Oceaneering designated
by Oceaneering and such designation shall not relieve
Oceaneering from any of its obligations under this Agreement
provided that such designation does not increase any Taxes
otherwise payable by Global.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement as of the date first above written.
Global: Oceaneering:
GLOBAL INDUSTRIES, LTD. OCEANEERING INTERNATIONAL, INC.
By: /s/ Peter Atkinson By: /s/ T. Jay Collins
------------------------- --------------------------
Peter Atkinson T. Jay Collins
President President
APPENDIX I
Oceaneering's Affiliates who own Diving Business Assets:
Oceaneering Australian Pty. Limited, an Australian company
Oceaneering International Services Limited, an English company
Oceaneering International AG, a Swiss company
APPENDIX II
Global's Affiliates who own ROV Business Assets:
Global International Vessels, Ltd., a Cayman Islands company
Global Offshore Pty. Ltd., an Australian company
Global Industries Asia Pacific Pty. Ltd., a Singapore company
