PROSPECTUS
Offer for all Outstanding
8 1/2% Series A Senior Notes Due 2005
in Exchange for
8 1/2% Series B Senior Notes Due 2005
of
Trico Marine Services, Inc.
Trico Marine Services, Inc., a Delaware corporation (the "Company"
or "Trico"), and the Guarantors (as defined herein) hereby offer, upon
the terms and subject to the conditions set forth in this Prospectus and
the accompanying letter of transmittal (the "Letter of Transmittal," and
together with this Prospectus, the "Exchange Offer"), to exchange $1,000
principal amount of registered 8 1/2% Series B Senior Notes Due 2005 of
the Company (the "New Notes") for each $1,000 principal amount of
unregistered 8 1/2% Series A Senior Notes Due 2005 of the Company (the
"Old Notes"), of which an aggregate principal amount of $110,000,000 is
outstanding. The form and terms of the New Notes are identical in all
material respects to the form and terms of the Old Notes except that (i)
the New Notes are being registered under the Securities Act of 1933, as
amended (the "Securities Act"), and, therefore, will not bear any
legends restricting their transfer and (ii) holders of the New Notes,
other than certain broker-dealers, will not be entitled to the rights of
holders of Transfer Restricted Securities (as defined herein) under the
Registration Rights Agreement (as defined herein). The New Notes will
evidence the same debt as the Old Notes and will be issued pursuant to,
and entitled to the benefits of, the Indenture (as defined herein)
governing the Old Notes. The New Notes and the Old Notes are sometimes
collectively referred to herein as the "Notes." See "The Exchange
Offer" and "Description of the Notes."
Interest on the New Notes will be payable semi-annually in arrears
on February 1 and August 1 of each year, commencing February 1, 1998.
Interest on the New Notes will accrue from the date of issuance of the
Old Notes, July 21, 1997. The New Notes will be redeemable at the
option of the Company, in whole or in part, at any time on or after
August 1, 2001 at the redemption prices set forth herein, plus accrued
and unpaid interest and Liquidated Damages (as defined herein), if any,
thereon, to the redemption date. Notwithstanding the foregoing, on or
prior to August 1, 2001, the Company may redeem the New Notes at its
option, in whole or in part, at the Make-Whole Price (as defined
herein), plus accrued and unpaid interest and Liquidated Damages, if
any, thereon, to the redemption date. In addition, on or prior to July
17, 2000, the Company may redeem up to 35% of the aggregate principal
amount of New Notes at a redemption price of 108.5% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages,
if any, thereon, to the redemption date, with the net cash proceeds of
one or more Qualified Equity Offerings (as defined herein), provided
that at least $71.5 million aggregate principal amount of New Notes
remains outstanding following each such redemption. Upon the occurrence
of a Change of Control (as defined herein), the Company will be required
to make an offer to repurchase all or any part of each holder's New
Notes at a price equal to 101% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon, to
the date of repurchase. See "Description of the Notes."
The New Notes will be general unsecured obligations of the
Company, ranking pari passu in right of payment with all other future
senior indebtedness of the Company, and senior in right of payment to
any subordinated indebtedness incurred by the Company in the future.
The New Notes will be effectively subordinated, however, to all future
secured obligations of the Company and to all current and future secured
obligations of the subsidiaries of the Company, to the extent of the
assets securing such obligations. As of June 30, 1997, after giving pro
forma effect to the sale of the Old Notes (the "Original Offering") and
the use of proceeds therefrom, the New Notes would have been effectively
subordinated to approximately $12.4 million of secured borrowings. The
Indenture will permit the Company and its subsidiaries to incur
additional indebtedness, including additional secured indebtedness,
under certain conditions. See "Risk Factors -- Ranking of the Notes;
Effective Subordination" and "Description of the Notes -- Certain
Covenants -- Incurrence of Indebtedness and Issuance of Preferred
Stock." The New Notes will be jointly and severally guaranteed by the
Company's present principal operating subsidiaries and future
Significant Subsidiaries (as defined herein).
See "Risk Factors" beginning on page 6 for a discussion
of certain factors that should be considered in connection
with the Exchange Offer and an investment in the New Notes
offered hereby.
This Prospectus is dated August 26, 1997
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The Company and the Guarantors will accept for exchange any and
all Old Notes validly tendered and not withdrawn prior to 5:00 p.m., New
York City time, on September 30, 1997, unless extended (as so extended,
the "Expiration Date"). Tenders of Old Notes may be withdrawn at any
time prior to 5:00 p.m. New York City time on the Expiration Date. The
Exchange Offer is not conditioned upon any minimum principal amount of
Old Notes being tendered for exchange; however, the Exchange Offer is
subject to certain customary conditions. Old Notes may be tendered only
in denominations of $1,000 principal amount and integral multiples
thereof. See "The Exchange Offer."
The Old Notes were sold by the Company on July 21, 1997 to Bear,
Stearns & Co. Inc., Jefferies & Company, Inc. and BancBoston Securities
Inc. (collectively, the "Initial Purchasers") in a private transaction
not subject to the registration requirements of the Securities Act. The
Old Notes were thereupon offered and sold by the Initial Purchasers only
to "qualified institutional buyers" (as defined in Rule 144A under the
Securities Act) and to a limited number of institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act), each of whom agreed to comply with certain transfer
restrictions and other conditions. Accordingly, the Old Notes may not
be offered, resold or otherwise transferred unless registered under the
Securities Act or unless an applicable exemption from the registration
requirements of the Securities Act is available. The New Notes are
being offered hereunder in order to satisfy the obligations of the
Company and the Guarantors under the Registration Rights Agreement
entered into with the Initial Purchasers in connection with the offering
of the Old Notes. See "The Exchange Offer" and "Description of the
Notes -- Registration Rights; Liquidated Damages."
Based on interpretations by the staff of the Securities and
Exchange Commission (the "Commission") set forth in no-action letters
issued to third parties, the Company and the Guarantors believe the New
Notes issued pursuant to the Exchange Offer in exchange for Old Notes
may be offered for resale, resold and otherwise transferred by any
holder thereof (other than broker-dealers, as set forth below, and any
such holder that is an "affiliate" of the Company within the meaning of
Rule 405 under the Securities Act) without compliance with the
registration and prospectus delivery provisions of the Securities Act,
provided that (i) the New Notes are acquired in the ordinary course of
such holder's business, (ii) the holder is not engaging in and does not
intend to engage in a distribution of the New Notes, and (iii) the
holder does not have an arrangement or understanding with any person to
participate in the distribution of the New Notes. Any holder who tenders
in the Exchange Offer with the intention to participate, or for the
purpose of participating, in a distribution of the New Notes or who is
an affiliate of the Company may not rely upon such interpretations by
the staff of the Commission and, in the absence of an exemption
therefrom, must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any secondary
resale transaction. Holders of Old Notes wishing to accept the Exchange
Offer must represent to the Company in the Letter of Transmittal that
such conditions have been met. The Letter of Transmittal states that by
so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in
connection with resales of New Notes received in exchange for Old Notes
where such Old Notes were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Company and
the Guarantors have agreed, for a period of one year after the effective
date of the Registration Statement of which this Prospectus forms a
part, to make this Prospectus available to any broker-dealer for use in
connection with any such resale.
The Old Notes are eligible for trading in the National Association
of Securities Dealers' Private Offering, Resales and Trading through
Automated Linkages ("PORTAL") Market. The Company does not intend to
list the New Notes on any securities exchange.
Neither the Company nor the Guarantors will receive any proceeds
from the Exchange Offer.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the rules and regulations thereunder, and in accordance therewith files
periodic reports, proxy and other information statements with the
Commission. All reports, proxy and information statements, and other
information filed by the Company with the Commission may be inspected at
the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, and at the regional offices
of the Commission located at 7 World Trade Center, 13th Floor, New York,
New York 10048, and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material may be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission also
maintains a Web site (http://www.sec.gov) that contains reports, proxy
and information statements regarding registrants, such as the Company,
that file electronically with the Commission. The Company's Common
Stock is traded on the Nasdaq National Market and reports, proxy
statements and other information concerning the Company can also be
inspected at the offices of the National Association of Securities
Dealers, Inc. at 1735 K Street, N.W., Washington, D.C. 20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's (i) Annual Report on Form 10-K for the fiscal year
ended December 31, 1996, (ii) Quarterly Reports on Form 10-Q for the
fiscal quarters ended March 31, 1997 and June 30, 1997 and (iii) Current
Reports on Form 8-K dated January 31, 1997 and July 21, 1997 which have
been filed by the Company with the Commission pursuant to the Exchange
Act, are by this reference incorporated in and made a part of this
Prospectus.
All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of the Exchange Offer shall be deemed to be
incorporated by reference in this Prospectus and to be part hereof from
the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a
copy of this Prospectus has been delivered, upon the written or oral
request of such person, a copy of any and all of the documents which
have been or may be incorporated by reference in this Prospectus, except
that exhibits to such documents will not be provided unless they are
specifically incorporated by reference into such documents. Requests
for copies of any such document should be directed to Trico Marine
Services, Inc., Attention: Corporate Secretary, 2401 Fountainview, Suite
626, Houston, Texas 77057 (telephone: (713) 780-9926).
SUMMARY
The following is a summary of certain information contained
elsewhere in this Prospectus or incorporated by reference herein and
does not purport to be complete. Reference is made to, and this Summary
is qualified in its entirety by and should be read in conjunction with,
the more detailed information contained elsewhere herein or incorporated
by reference in this Prospectus. Unless otherwise defined herein,
capitalized terms used in this Summary have the respective meanings
ascribed to them elsewhere in this Prospectus or in the Indenture (as
defined herein).
The Company
Trico is a leading provider of marine support vessels and related
services to the oil and gas industry in the U.S. Gulf of Mexico (the
"Gulf") and offshore Brazil. The Company is the second largest owner
and operator of supply boats in the Gulf and has a total fleet of 81
vessels, including 52 supply boats, 14 crew boats, six lift boats and
nine line handling boats. Since its initial public offering in May
1996, Trico has acquired 36 supply boats at an aggregate cost of $164.5
million, including 11 supply boats purchased for $62.0 million with the
proceeds of the Original Offering. The Company will purchase a 225-foot
supply boat, which is in the final stages of a major upgrade by its
current owner, upon completion of the upgrade. The Company believes that
the increased size of its vessel fleet will enable it to take further
advantage of the strong demand for marine support vessels in the Gulf
and the resulting high utilization levels and increased vessel day
rates. The Company's average supply boat day rate increased to $7,076
during the second quarter of 1997 from $4,256 during the comparable
1996 period.
The services provided by Trico's diversified fleet include
transportation of drilling materials, supplies and crews to offshore
exploration and production facilities and support for the construction,
installation, maintenance and removal of offshore facilities. Trico has
focused on providing high quality, responsive service while maintaining
a low cost structure. The Company believes the quality of its fleet and
the strength of its experienced management team have allowed the Company
to develop and maintain long-term customer relationships.
The Original Offering and Use of Proceeds
The Old Notes were sold by the Company on July 21, 1997 to the
Initial Purchasers and were thereupon offered and sold by the Initial
Purchasers only to certain qualified buyers. The Company used $62.0
million of the $106.1 million net proceeds from the Original Offering to
fund the acquisition of 11 supply boats, $37.1 million to repay
outstanding indebtedness under the Company's $65.0 million revolving
credit facility (the "Bank Credit Facility") and intends to use the
remaining $7.0 million to fund the acquisition of the 225-foot supply
boat, upon completion of the upgrade.
The Exchange Offer
The Exchange Offer relates to the exchange of up to $110 million
aggregate principal amount of New Notes for up to $110 million aggregate
principal amount of the Old Notes. The form and terms of the New Notes
are identical in all material respects to the form and terms of the Old
Notes except that (i) the New Notes are being registered under the
Securities Act and, therefore, will not bear any legends restricting
their transfer and (ii) holders of the New Notes, other than certain
broker-dealers, will not be entitled to the rights of holders of
Transfer Restricted Securities under the Registration Rights Agreement.
The New Notes will evidence the same debt as the Old Notes and will be
issued pursuant to, and entitled to the benefits of, the Indenture. The
Old Notes and the New Notes are sometimes referred to collectively
herein as the "Notes." See "Description of the Notes."
The Exchange
Offer.............. Pursuant to the Exchange Offer, $1,000 principal
amount of New Notes will be issued in exchange for
each $1,000 principal amount of Old Notes that are
validly tendered and not withdrawn. As of the date
hereof, Old Notes representing $110 million
aggregate principal amount are outstanding. The
terms of the New Notes and the Old Notes are
substantially identical.
Resales............ Based on interpretations by the staff of the
Commission set forth in no-action letters issued to
third parties unrelated to the Company and the
Guarantors, the Company and the Guarantors believe
that the New Notes issued pursuant to the Exchange
Offer in exchange for Old Notes may be offered for
resale, resold and otherwise transferred by any
holder thereof (other than broker-dealers, as set
forth below, and any such holder or such other
person that is an "affiliate" of the Company within
the meaning of Rule 405 under the Securities Act),
without compliance with the registration and
prospectus delivery provisions of the Securities
Act, provided that (i) the New Notes are acquired in
the ordinary course of such holder's business, (ii)
such holder is not engaging in and does not intend
to engage in a distribution of the New Notes, and
(iii) such holder does not have an arrangement or
understanding with any person to participate in the
distribution of the New Notes. Any holder who
tenders in the Exchange Offer with the intention to
participate, or for the purpose of participating, in
a distribution of the New Notes or who is an
affiliate of the Company may not rely upon such
interpretations by the staff of the Commission and,
in the absence of an exemption therefrom, must
comply with the registration and prospectus delivery
requirements of the Securities Act in connection
with any secondary resale transaction. Failure to
comply with such requirements in such instance may
result in such holder incurring liabilities under
the Securities Act for which the holder is not
indemnified by the Company. Each broker-dealer that
receives New Notes for its own account in exchange
for Old Notes, where those Old Notes were acquired
by the broker-dealer as a result of its market-
making activities or other trading activities, must
acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. The
Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is
an "underwriter" within the meaning of the
Securities Act. The Company has agreed that, for a
period of one year after the effective date of the
Registration Statement of which this Prospectus is a
part, it will make this Prospectus available to any
broker-dealer for use in connection with any such
resale.
The Exchange Offer is not being made to, nor will
the Company accept surrenders for exchange from,
holders of Old Notes in any jurisdiction in which
this Exchange Offer or the acceptance thereof would
not be in compliance with the securities or blue sky
laws of such jurisdiction.
Expiration Date.... The Exchange Offer will expire at 5:00 p.m., New
York City time, on September 30, 1997, unless
extended, in which case, the term "Expiration Date"
shall mean the latest date and time to which the
Exchange Offer is extended. See "The Exchange Offer
-- Terms of the Exchange Offer -- Expiration Date;
Extension; Amendments."
Conditions to the
Exchange Offer..... The Exchange Offer is subject to certain customary
conditions, certain of which may be waived by the
Company. See "The Exchange Offer -- Terms of the
Exchange Offer -- Conditions to the Exchange Offer."
The Exchange Offer is not conditioned upon any
minimum principal amount of Old Notes being
tendered.
Procedures for Tendering
Old Notes.......... Each holder of Old Notes wishing to accept the
Exchange Offer must complete, sign and date the
Letter of Transmittal, or a facsimile thereof, in
accordance with the instructions contained herein
and therein, and mail or otherwise deliver the
Letter of Transmittal, or a facsimile, together with
the Old Notes and any other required documentation,
to the Exchange Agent (as defined herein) at the
address set forth herein and in the Letter of
Transmittal. Persons holding Old Notes through the
Depository Trust Company ("DTC") and wishing to
accept the Exchange Offer must do so pursuant to
DTC's Automated Tender Offer Program, by which each
tendering Participant will agree to be bound by the
Letter of Transmittal. By executing or agreeing to
be bound by the Letter of Transmittal, each holder
will represent to the Company that, among other
things, (i) the New Notes acquired pursuant to the
Exchange Offer are being acquired in the ordinary
course of such holder's business, (ii) such holder
is not engaging and does not intend to engage in a
distribution of such New Notes, (iii) such holder
does not have an arrangement or understanding with
any person to participate in the distribution of
such New Notes, and (iv) such holder is not an
"affiliate," as defined under Rule 405 promulgated
under the Securities Act, of the Company.
Special Procedures for
Beneficial
Owners............. Any beneficial owner whose Old Notes are registered
in the name of a broker, dealer, commercial bank,
trust company or other nominee and who wishes to
tender such Old Notes in the Exchange Offer should
contact such registered holder promptly and instruct
such registered holder to tender on such beneficial
owner's behalf. If such beneficial owner wishes to
tender on its own behalf, such owner must, prior to
completing and executing the Letter of Transmittal
and delivering its Old Notes, either make
appropriate arrangements to register ownership of
the Old Notes in such owner's name or obtain a
properly completed bond power from the registered
holder. The transfer of registered ownership may
take considerable time and may not be able to be
completed prior to the Expiration Date. See "The
Exchange Offer -- Terms of the Exchange Offer --
Procedures for Tendering Old Notes."
Guaranteed Delivery
Procedures......... Holders of Old Notes who wish to tender their Old
Notes and whose Old Notes are not immediately
available or who cannot deliver their Old Notes, the
Letter of Transmittal or any other documents
required by the Letter of Transmittal to the
Exchange Agent prior to the Expiration Date, must
tender their Old Notes according to the guaranteed
delivery procedures set forth in "The Exchange Offer
-- Terms of the Exchange Offer -- Guaranteed
Delivery Procedures."
Withdrawal......... The tender of Old Notes pursuant to the Exchange
Offer may be withdrawn at any time prior to 5:00
p.m., New York City time, on the Expiration Date.
Any Old Notes not accepted for exchange for any
reason will be returned without expense to the
tendering holder thereof as promptly as practicable
after the expiration or termination of the Exchange
Offer. See "The Exchange Offer -- Terms of the
Exchange Offer -- Withdrawal Rights."
Acceptance of Old Notes
and Delivery of
New Notes.......... Subject to certain conditions (as described more
fully in "The Exchange Offer -- Terms of the
Exchange Offer -- Conditions to the Exchange
Offer"), the Company will accept for exchange any
and all Old Notes which are properly tendered in the
Exchange Offer prior to 5:00 p.m., New York City
time, on the Expiration Date. The New Notes issued
pursuant to the Exchange Offer will be delivered
promptly following the Expiration Date. See "The
Exchange Offer -- Terms of the Exchange Offer."
Interest on the
New Notes and
the Old Notes...... Interest on each New Note will accrue from the date
of issuance of the Old Note for which the New Note
is exchanged.
Exchange Agent..... Texas Commerce Bank National Association is serving
as Exchange Agent in connection with the Exchange
Offer. The address, telephone number and facsimile
number of the Exchange Agent are set forth in "The
Exchange Offer -- Exchange Agent."
Effect of Not
Tendering.......... Old Notes that are not tendered or that are
tendered but not accepted will, following the
completion of the Exchange Offer, continue to be
subject to the existing restrictions upon transfer
thereof. The Company will have no further
obligation (other than as described in "Description
of the Notes -- Registration Rights; Liquidated
Damages" with respect to the Shelf Registration
Statement (as defined herein)) to provide for the
registration under the Securities Act of such Old
Notes.
Terms of New Notes
Securities
Offered............ $110.0 million aggregate principal amount of 8 1/2%
Series B Senior Notes due 2005.
Maturity........... August 1, 2005
Interest Payment
Dates.............. Interest on the New Notes will be payable semi-
annually in arrears on February 1 and August 1 of
each year, commencing February 1, 1998.
Ranking............ The New Notes will be general unsecured obligations
of the Company, ranking pari passu in right of
payment with all other present or future senior
indebtedness of the Company and senior in right of
payment to all present or future subordinated
indebtedness of the Company. The New Notes will be
effectively subordinated, however, to all secured
obligations of the Company and its subsidiaries,
including borrowings under the Bank Credit Facility,
to the extent of the assets securing such
obligations. As of June 30, 1997, after giving pro
forma effect to the Original Offering and the use of
proceeds therefrom, the New Notes would have been
effectively subordinated to approximately
$12.4 million of secured borrowings of the Company.
The Indenture permits the Company and its
subsidiaries to incur additional indebtedness,
including additional secured indebtedness, subject
to certain conditions.
Guarantees......... The New Notes will be jointly and severally
guaranteed on a senior unsecured basis by the
Company's principal operating subsidiaries and
future Significant Subsidiaries. See "Description
of the Notes -- Subsidiary Guarantees."
Optional
Redemption......... The New Notes will be redeemable at the option of
the Company, in whole or in part, at any time on or
after August 1, 2001, at redemption prices set forth
herein, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, to the
redemption date. Notwithstanding the foregoing, on
or prior to August 1, 2001, the Company may redeem
the New Notes at its option, in whole or in part, at
the Make-Whole Price (as defined herein), plus
accrued and unpaid interest and Liquidated Damages,
if any, thereon, to the redemption date. In
addition, on or prior to July 17, 2000, the Company
may redeem up to 35% of the aggregate principal
amount of the New Notes originally issued at a
redemption price of 108.5% of the principal amount
thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, to the
redemption date, with the net cash proceeds of one
or more Qualified Equity Offerings, provided that at
least $71.5 million aggregate principal amount of
New Notes remains outstanding following each such
redemption. See "Description of the Notes --
Optional Redemption."
Change of
Control........... Upon the occurrence of a Change of Control, the
Company will be required to make an offer to
repurchase all or any part of each holder's New
Notes at a price equal to 101% of the principal
amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, to the date of
repurchase. See "Risk Factors -- Potential
Inability to Fund a Change of Control" and
"Description of the Notes -- Repurchase at the
Option of Holders -- Change of Control."
Certain
Covenants.......... The indenture pursuant to which the New Notes will
be issued (the "Indenture") contains certain
covenants that, among other things, limits the
ability of the Company and its subsidiaries to incur
additional Indebtedness (as defined herein), pay
dividends or make other distributions, repurchase
Equity Interests (as defined herein) or subordinated
indebtedness, create certain liens, enter into
certain transactions with affiliates, issue or sell
capital stock of subsidiaries, engage in sale-and-
leaseback transactions, sell assets or enter into
certain mergers or consolidations. See "Description
of the Notes -- Certain Covenants."
Exchange Offer;
Registration
Rights............. Pursuant to a registration rights agreement by and
between the Company, the Guarantors and the Initial
Purchasers (the "Registration Rights Agreement"),
the Company and the Guarantors have agreed to file
the Registration Statement of which this Prospectus
forms a part (the "Exchange Offer Registration
Statement") with the Commission under the Securities
Act with respect to the Exchange Offer. If (a) the
Company and the Guarantors are not permitted to
consummate the Exchange Offer because the Exchange
Offer is not permitted by applicable law or
Commission policy or (b) any holder of Transfer
Restricted Securities notifies the Company prior to
the 20th day following consummation of the Exchange
Offer that (i) it is prohibited by law or Commission
policy from participating in the Exchange Offer or
(ii) that it may not resell the New Notes acquired
by it in the Exchange Offer to the public without
delivering a prospectus and the prospectus contained
in the Exchange Registration Statement would not be
available for such resales, the Company will file
with the Commission a shelf registration statement
(the "Shelf Registration Statement") to cover
resales of the Notes by holders thereof who satisfy
certain conditions relating to the provision of
information in connection with the Shelf
Registration Statement. If the Company fails to
satisfy these registration obligations, it will be
required to pay liquidated damages to the holders of
the Old Notes under certain circumstances
("Liquidated Damages"). See "Description of the
Notes -- Registration Rights; Liquidated Damages."
For further information regarding the Notes, see "Description of the
Notes."
Use Of Proceeds
The Company will not receive any proceeds from the issuance of the
New Notes pursuant to this Prospectus.
Risk Factors
For a discussion of certain factors that should be considered in
connection with the Exchange Offer and an investment in the New Notes
offered hereby, see "Risk Factors."
RISK FACTORS
In addition to the other information set forth elsewhere in this
Prospectus or incorporated by reference herein, the following factors
relating to the Company and this Exchange Offer should be considered by
prospective investors when evaluating an investment in the New Notes
offered hereby.
Substantial Indebtedness
At June 30, 1997, on the pro forma basis, after giving effect to
the Original Offering and the application of the proceeds therefrom, the
Company would have had $122.4 million of indebtedness and stockholders'
equity of $118.7 million. In addition, the terms of the Notes permit
the Company to incur $65.0 million of indebtedness under the Bank Credit
Facility and certain other indebtedness. The Company's level of
indebtedness has several important effects on its future operations,
including (i) the Company's ability to obtain additional financing in
the future for working capital, capital expenditures, acquisitions,
general corporate purposes or other purposes may be impaired, (ii) a
reduction of funds available to the Company for its operations or for
capital expenditures as a result of the dedication of a substantial
portion of the Company's cash flow to the payment of principal of and
interest on the Company's indebtedness, including indebtedness under the
Notes, (iii) restrictions in the Indenture that limit the Company's
ability to borrow additional funds or to dispose of assets, which may
affect the Company's flexibility in planning for, and reacting to,
changes in its business, including possible acquisition activities, (iv)
the possibility of an event of default under the financial and operating
covenants contained in the Company's debt instruments, including the
Indenture, which, if not cured or waived, could have a material adverse
effect on the Company and (v) an inability to adjust to rapidly changing
market conditions and consequent vulnerability in the event that a
downturn in general economic conditions or its business because of the
Company's reduced financial flexibility. Moreover, future acquisitions
may require the Company to alter its capitalization significantly. See
"Description of the Notes -- Certain Covenants."
The Company's ability to meet its debt service obligations and to
reduce its total indebtedness will be dependent upon the Company's
future performance, which will be subject to levels of activity in
offshore oil and gas exploration, development and production,
particularly in the Gulf, general economic conditions and to financial,
business and other factors affecting the operations of the Company, many
of which are beyond its control. There can be no assurance that the
Company's future performance will not be adversely affected by such
economic conditions and financial, business and other factors. See
"Capitalization."
If the Company is unable to generate sufficient cash flow from
operations in the future to service its debt, it may be required to
refinance all or a portion of its existing debt, including the Notes, or
to obtain additional financing. There can be no assurance that any such
refinancing would be possible or that any additional financing could be
obtained. The inability to obtain additional financing could have a
material adverse effect on the Company. For example, a default by the
Company under the terms of the Indenture could result in a default under
the terms of the Bank Credit Facility.
Restrictions Imposed by Terms of the Company's Indebtedness
The Indenture restricts, among other things, the ability of the
Company and its subsidiaries to incur additional indebtedness, pay
dividends or make certain other restricted payments, incur liens to
secure pari passu or subordinated indebtedness, apply net proceeds from
certain asset sales, merge or consolidate with any other person, sell,
assign, transfer, lease, convey or otherwise dispose of substantially
all of the assets of the Company, or enter into certain transactions
with affiliates. In addition, the Bank Credit Facility contains, and
future credit facilities may contain, other and more restrictive
covenants and prohibits the Company from prepaying other indebtedness
(including the Notes) before indebtedness outstanding under the Bank
Credit Facility or such other credit facility. As a result of these
covenants, the ability of the Company to respond to changes in business
and economic conditions and to secure additional financing, if needed,
may be significantly restricted, and the Company may be prevented from
engaging in transactions that might otherwise be considered beneficial
to the Company. See "Description of the Notes -- Certain Covenants."
The Bank Credit Facility also requires, and future credit facilities may
require, the Company to maintain specified financial ratios and satisfy
certain financial condition tests. The Company's ability to meet these
financial ratios and tests can be affected by events beyond its control,
and there can be no assurance that the Company will meet those tests.
The breach of any of these covenants could result in a default under the
Bank Credit facility or such other credit facility. Upon the occurrence
of an event of default under the Bank Credit Facility or such other
credit facility, the lenders thereunder could elect to declare all
amounts outstanding under such credit facilities, including accrued
interest or other obligations to be immediately due and payable. If the
Company were unable to repay those amounts, such lenders could proceed
against the collateral granted to them to secure that indebtedness. If
amounts outstanding under such credit facilities were to be accelerated,
there can be no assurance that the assets of the Company would be
sufficient to repay in full that indebtedness and other indebtedness of
the Company, including the Notes.
Ranking of the Notes; Effective Subordination
The Old Notes are, and the New Notes will be, senior unsecured
obligations of the Company ranking pari passu with all existing or
future senior indebtedness of the Company. Holders of secured
indebtedness of the Company and its subsidiaries, including the Bank
Credit Facility, however, will have claims with respect to the assets
constituting collateral for such indebtedness that are superior to the
claims of the holders of the Notes. In the event of a liquidation or
insolvency of the Company or if any of its secured indebtedness is
accelerated, the secured assets of the Company will be available to pay
obligations on the Notes only after the Bank Credit Facility and any
other secured indebtedness has been paid in full. Accordingly, the Old
Notes are, and the New Notes will be, effectively subordinated to claims
of secured creditors of the Company and its Restricted Subsidiaries to
the extent of such pledged collateral. At June 30, 1997, after giving
pro forma effect to the Original Offering and the application of
proceeds therefrom, the Company and its Restricted Subsidiaries would
have had $12.4 million of secured indebtedness that effectively would
rank senior to the Notes and the Subsidiary Guarantees (as defined
herein) in right of payment, and no other Indebtedness other than the
Notes. The Indenture limits the amount of liens securing the Bank Credit
Facility to $65 million plus 15% of Consolidated Net Tangible Assets.
See "Description of the Notes -- Certain Covenants -- Incurrence of
Indebtedness."
Potential Inability to Fund a Change of Control Offer
Upon a Change of Control (as defined in the Indenture), the
Company will be required to offer to repurchase all outstanding Notes at
101% of the principal amount thereof, plus accrued and unpaid interest
and Liquidated Damages, if any, to the date of repurchase. Certain
events involving a Change of Control may result in an event of default
under the Bank Credit Facility and may result in an event of default
under certain other indebtedness of the Company that may be incurred in
the future. An event of default under the Bank Credit Facility or other
indebtedness could result in acceleration of such indebtedness, in which
case the Notes would be effectively subordinated to the borrowings under
the Bank Credit Facility or other secured indebtedness to the extent of
any liens securing that debt. There can be no assurance that sufficient
funds will be available to the Company at the time of any Change of
Control to make any required repurchases of Notes tendered, pay its
obligations under the Bank Credit Facility or other indebtedness upon
the occurrence of a Change of Control. These provisions may be deemed
to have anti-takeover effects and may delay, defer or prevent a merger,
tender offer or other takeover attempt. Notwithstanding these
provisions, the Company could enter into certain transactions, including
certain recapitalizations, that would not constitute a Change of Control
but would increase the amount of debt outstanding at such time. See
"Description of the Notes -- Repurchase at Options of Holders."
Industry Volatility; Geographic Concentration
The Company's operations depend on levels of activity in offshore
oil and gas exploration, development and production, particularly in the
Gulf where the majority of the Company's operations are conducted. The
level of exploration and development activity has traditionally been
volatile as a result of fluctuations in oil and gas prices and their
uncertainty in the future. A significant or prolonged reduction in oil
or natural gas prices in the future would likely depress offshore
drilling and development activity and reduce the demand for the
Company's marine support services. A substantial reduction of activity
in the Gulf could have a material adverse effect on the Company's
financial condition and results of operations.
Competition
The Company's business is highly competitive. Competition in the
marine support services industry primarily involves factors such as (i)
price, service and reputation of vessel operators and crews, (ii) the
availability of vessels of the type and size needed by the customer and
(iii) the quality of equipment. In the Gulf, the Company competes with
both large and small companies. Certain of these competitors have
significantly greater financial resources than the Company. In
addition, certain of the Company's competitors are building new supply
boats, many of which are specialized and greater than 220 feet in
length, crew boats greater than 120 feet in length and lift boats with
leg lengths in excess of 200 feet. Continued new construction of
supply, crew and lift boats by the Company's competitors and
redeployment of existing vessels to the Gulf could increase the levels
of competition within these vessel classes.
Future Acquisitions
The Company's growth has been primarily the result of
acquisitions. The Company is continually reviewing possible
acquisitions of single vessels, vessel fleets and businesses that are
complimentary to the Company's existing business. There can be no
assurance that suitable acquisition candidates will be found, or that
financing for any such future acquisitions will be obtainable on
acceptable terms. In addition, the terms of the Bank Credit Facility
and the Indenture may restrict the Company's ability to pursue and
consummate additional acquisitions. The inability of the Company to
find or consummate suitable acquisitions in the future could impede
future growth. Furthermore, even if the Company is able to complete
such acquisitions, there can be no assurance that the acquired companies
or assets will be successfully integrated into the Company. Any failure
to integrate successfully future acquisitions may adversely impact
operations or profitability.
Operating Risks and Insurance
Marine support vessels are subject to operating risks such as
catastrophic marine disaster, adverse weather conditions, mechanical
failure, collisions, oil and hazardous substance spills and navigation
errors. The occurrence of any of these events may result in damage to
or loss of Company vessels and such vessels' tow or cargo or other
property and injury to passengers and personnel. Such occurrences may
also result in a significant increase in operating costs or liability to
third parties. The Company maintains insurance coverage against certain
of these risks, which management considers to be customary in the
industry. There can be no assurance, however, that the Company's
existing insurance coverage can be renewed at commercially reasonable
rates or that such coverage will be adequate to cover future claims that
may arise.
Government Regulation
The Company's operations are materially affected by federal, state
and local regulation, as well as certain international conventions and
private industry organizations. These regulations govern worker health
and safety and the manning, construction and operation of vessels.
These organizations establish safety criteria and are authorized to
investigate vessel accidents and recommend approved safety standards.
The failure to comply with the requirements of any of these laws or the
rules or regulations of these agencies and organizations could have a
material adverse effect on the Company.
The Company's operations also are subject to federal, state and
local laws and regulations which control the discharge of pollutants
into the environment and which otherwise relate to environmental
protection. Substantial costs may be incurred in complying with such
laws and regulations, and noncompliance can subject the Company to
substantial liabilities. There can be no assurance that such costs and
liabilities will not be incurred. The Company's operations are subject
to the Outer Continental Shelf Lands Act, and regulations promulgated
thereunder, which regulate the activities of offshore service vessels,
require vessel owners and operators to demonstrate financial and
operational responsibility and provide for certain limitations on the
liability of vessel owners and operators. The Company's operations are
also subject to the Clean Water Act, which imposes strict controls
against the discharge of oil and other pollutants into surface waters
within its jurisdiction. Any hazardous substances transported by the
Company are subject to regulation under the Resource Conservation and
Recovery Act and the Hazardous Materials Transportation Act. Numerous
other environmental laws and regulations also apply to the operations of
the Company, and such laws and regulations are subject to frequent
change. While the Company's insurance policies provide coverage for
accidental occurrence of seepage and pollution or clean-up and
containment of the foregoing, pollution and similar environmental risks
generally are not fully insurable.
Any violation of such laws or regulations could result in
significant liability to the Company, and any amendment to such laws or
regulations that mandates more stringent compliance standards would
likely cause an increase in the Company's vessel maintenance expenses.
Seasonality
Marine operations conducted in the Gulf are seasonal and depend,
in part, on weather conditions. Historically, Trico has enjoyed its
highest utilization rates during the second and third quarters, as mild
weather provides favorable conditions for offshore exploration,
development and construction. Utilization rates typically have reached
their lowest levels in the first quarter, when offshore marine activity
generally declines as oil and gas companies complete internal annual
exploration budget reviews. Adverse weather conditions during the
winter months generally curtail offshore development operations and can
particularly impact lift boat utilization rates. Accordingly, the
results of any one quarter are not necessarily indicative of annual
results or continuing trends.
Age of Fleet
As of June 1, 1997, the average age of the Company's vessels
(based on the date of construction) was approximately 16 years.
Management believes that after a vessel has been in service for
approximately 30 years, repair, vessel certification and maintenance
costs may become no longer economically justifiable. There can be no
assurance that the Company will be able to maintain its fleet by
extending the economic life of existing vessels through major
refurbishment or by acquiring new or used vessels.
International Operations
The Company's international operations are subject to a number of
risks inherent with any business operating in foreign countries. These
risks include, among others, political instability, potential vessel
seizure, nationalization of assets, currency restrictions and exchange
rate fluctuations, import-export quotas and other forms of public and
governmental regulation, all of which are beyond the control of the
Company. Historically, the Company's operations have not been affected
materially by such conditions or events, but if the Company's
international operations expand, the exposure to these risks will also
increase. Although it is impossible to predict the nature and the
likelihood of any events of these types, if such an event should occur,
it could have a material adverse effect on the Company's financial
condition and results of operations.
Fraudulent Transfer Considerations
Under applicable provisions of the United States Bankruptcy Code
or comparable provisions of state fraudulent transfer or conveyance law,
if the Guarantors, at the time they incurred the Subsidiary Guarantees,
(a) incurred such indebtedness with the intent to hinder, delay or
defraud creditors, or (b)(i) received less than reasonably equivalent
value or fair consideration and (ii)(A) was insolvent at the time of
such incurrence, (B) was rendered insolvent by reason of such incurrence
(and the application of the proceeds thereof), (C) was engaged or was
about to engage in a business or transaction for which the assets
remaining with the Company constituted unreasonably small capital to
carry on its business, or (D) intended to incur, or believed that it
would incur, debts beyond its ability to pay such debts as they mature,
then, in each such case, a court of competent jurisdiction could void,
in whole or in part, the Subsidiary Guarantees or, in the alternative,
subordinate the Subsidiary Guarantees to existing and future
indebtedness of the Guarantors. Among other things, a legal challenge
of the Subsidiary Guarantees issued by any Guarantor on fraudulent
conveyance grounds may focus on the benefits, if any, realized by such
Guarantor as a result of the issuance by the Company of the Notes. To
the extent the Subsidiary Guarantee was voided as a fraudulent
conveyance or held unenforceable for any other reason, the holders of
the Notes would cease to have any claim against such Guarantor and would
be creditors solely of the Company and any Guarantor whose Subsidiary
Guarantees were not voided or held unenforceable. In such event, the
claims of the holders of the Notes against the issuer of an invalid
Subsidiary Guarantee would be subject to the prior payment of all
liabilities of such Guarantor. There can be no assurance that, after
providing for all prior claims, there would be sufficient assets to
satisfy the claims of the holders of the Notes relating to any avoided
portions of any of the Subsidiary Guarantees.
The measure of insolvency for purposes of the foregoing would
likely vary depending upon the law applied in such case. Generally,
however, a Guarantor would be considered insolvent if the sum of its
debts, including contingent liabilities, was greater than all of its
assets at a fair valuation, or if the present fair saleable value of its
assets was less than the amount that would be required to pay the
probable liabilities on its existing debts, including contingent
liabilities, as such debts become absolute and matured. The Company
believes that, for purposes of the United States Bankruptcy Code and
state fraudulent transfer or conveyance laws, the Subsidiary Guarantees
were issued, with respect to the Old Notes, and will be issued, with
respect to the New Notes, without the intent to hinder, delay or defraud
creditors and for proper purposes and in good faith, and that the
Guarantors will receive reasonably equivalent value or fair
consideration therefor, and that after the issuance of the Subsidiary
Guarantees and the application of the net proceeds therefrom, the
Guarantors will be solvent, have sufficient capital for carrying on
their businesses and will be able to pay their debts as they mature.
However, there can be no assurance that a court passing on such issues
would agree with the determination of the Company.
Absence of a Public Market for the Notes
The New Notes are a new issue of securities for which there
currently is no public market. The Company does not intend to list the
New Notes on any securities exchange. Although the Initial Purchasers
have informed the Company that they intend to make a market in the New
Notes, the Initial Purchasers are not obligated to do so and any market
making may be discontinued at any time at the sole discretion of the
Initial Purchasers. If a market develops for the New Notes, there can
be no assurance as to the liquidity of such market, the ability of
holders to sell their New Notes or the prices at which holders would be
able to sell the New Notes. If a market for the New Notes does develop,
the New Notes may trade at a discount to their principal amount,
depending on prevailing interest rates, the market for similar
securities, the performance of the Company, the performance of the oil
and gas services industry and other factors. Pursuant to the
Registration Rights Agreement, the Company is required to commence the
Exchange Offer for the New Notes or file the Shelf Registration
Statement covering resales of the New Notes within specified time
periods.
Consequences of Failure to Exchange
Holders of Old Notes who do not exchange their Old Notes for New
Notes pursuant to the Exchange Offer will continue to be subject to the
restrictions on transfer of Old Notes set forth in the legend thereon as
a consequence of the issuance of the Old Notes pursuant to an exemption
from, or in a transaction not subject to, the registration requirements
of the Securities Act. In general, the Old Notes may not be offered or
sold, unless registered under the Securities Act, except pursuant to an
exemption from, or in a transaction not subject to, the Securities Act
and applicable state securities laws. Except as described below in the
second paragraph under "The Exchange Offer -- Purpose and Effect," the
Company does not anticipate registering the Old Notes under the
Securities Act.
Forward-Looking Statements
This Prospectus includes and incorporates by reference "forward-
looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act. All statements other than
statements of historical fact included in this Prospectus or
incorporated by reference herein, including without limitation the
statements under the captions "Summary," "Risk Factors," "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" and "Business" and elsewhere herein or incorporated by
reference regarding Trico's financial position and liquidity, its
strategic alternatives, future capital needs, exploration, development
and capital expenditures of the oil and gas industry, business
strategies, and other plans and objectives of management of the Company
for future operations and activities, are forward-looking statements.
These statements are based on certain assumptions and analyses made by
the Company in light of its experience and its perception of historical
trends, current conditions, expected future developments and other
factors it believes are appropriate under the circumstances. Such
statements are subject to risks and uncertainties, including the risk
factors discussed above, general economic and business conditions, the
business opportunities that may be presented to and pursued by the
Company, changes in law or regulations and other factors, many of which
are beyond the control of the Company. Although Trico believes that the
expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove
to have been correct. Prospective investors are therefore cautioned
that any such statements are not guarantees of future performance and
the actual results or developments may differ materially from those
projected in the forward-looking statements. Important factors that
could cause actual results to differ materially from Trico's
expectations are disclosed in this Prospectus.
USE OF PROCEEDS
The Company will not receive any cash proceeds from the issuance
of the New Notes offered hereby. In consideration for issuing the New
Notes as contemplated in this Prospectus, the Company will receive in
exchange a like principal amount of Old Notes, the terms of which are
identical in all material respects to the New Notes. The Old Notes
surrendered in exchange for the New Notes will be retired and canceled
and cannot be reissued. Accordingly, issuance of the New Notes will not
result in any change in capitalization of the Company. The Company used
all the net proceeds of the Original Offering (approximately $106.1
million) to finance the acquisition of eleven supply boats ($62.0
million), to repay outstanding indebtedness under the Bank Credit
Facility ($37.1 million) and intends to use the remaining $7.0 million
to fund the pending acquisition of another supply boat.
CAPITALIZATION
The following table sets forth the consolidated unaudited
capitalization of the Company as of June 30, 1997 and as adjusted to
reflect the sale of the Old Notes and the application of the net
proceeds therefrom. This table should be read in conjunction with the
Company's consolidated financial statements and notes incorporated by
reference herein.
June 30, 1997
---------------------------
Actual As Adjusted
---------- -------------
(Dollars in thousands)
Long-term debt, including
current maturities:
8 1/2% Senior Notes due 2005............... $ --- $ 110,000
Bank Credit Facility....................... 49,500 12,356
---------- ------------
Total long-term debt........................... 49,500 122,356
---------- ------------
Stockholders' equity:
Preferred stock, $.01 par value per share;
5,000,000 shares authorized; no shares
outstanding.......................... --- ---
Common Stock, $.01 par value per share;
40,000,000 shares authorized;
15,646,378 issued and 15,574,346
outstanding (1)...................... 156 156
Additional paid-in capital................. 93,893 93,893
Retained earnings.......................... 24,652 24,652
Treasury stock (72,032 shares)............. (1) (1)
---------- ---------
Total stockholders' equity......... 118,700 118,700
---------- ---------
Total capitalization............... $ 168,200 $ 241,056
========= =========
(1) Gives effect to the 100% stock dividend effective June 9, 1997,
but does not include an aggregate of 1,588,300 shares of Common
Stock issuable upon exercise of outstanding options held by
officers, directors and employees as of June 30, 1997.
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA
The following table sets forth selected consolidated financial and
operating data for the dates and periods indicated. The financial
information for the two month period ended December 31, 1993 and for
each of the years ended December 31, 1994, 1995 and 1996 and as of
December 31, 1993, 1994, 1995 and 1996 is derived from the Company's
audited consolidated financial statements and notes thereto. The
selected consolidated financial data as of June 30, 1996 and 1997 and
for the six month periods then ended are derived from the unaudited
consolidated statements of the Company for such periods. In the opinion
of management, the unaudited financial statements of the Company reflect
all adjustments (consisting of only normal recurring adjustments)
necessary for fair presentation of the financial condition and results
of operations for these periods. The financial information for the year
ended December 31, 1992 and the ten month period ending October 28, 1993
reflects operating results for the vessels acquired by the Company from
Chrysler in October 1993. During 1996, the Company acquired 18 supply
boats and 8 line handling vessels, and since the beginning of 1997 the
Company has acquired 18 supply boats and has a pending acquisition of
one supply boat. None of these acquisitions has been included on a pro
forma basis as of the beginning of the period in which the acquisitions
occurred. This information should be read in conjunction with the
consolidated financial statements and notes thereto and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" set forth in the Company's Annual Report on Form 10-K for
the year ended December 31, 1996 and Quarterly Report on Form 10-Q for
the quarter ended June 30, 1997 incorporated by reference into this
Prospectus.
<TABLE>
<CAPTION>
Year ended December 31,
-----------------------------------------------------------
Ten Two
months months
ended ended Six months
October December ended June 30,
28, 31 -------------------
1992(1) 1993(1) 1993(1) 1994 1995 1996 1996 1997
-------- -------- -------- -------- -------- -------- -------- ---------
(Financial data in thousands, except per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Income Statement
Data:
Total revenues $ 17,988 $ 26,871 $ 6,145 $ 29,034 $ 26,698 $ 53,484 $ 19,495 $ 49,785
Direct operating
expenses:
Direct vessel
operating
expenses 13,360 16,511 3,042 17,165 16,988 24,150 10,383 17,220
General and
administrative 1,338 1,412 256 2,057 2,509 3,277 1,385 2,732
Amortization of
marine inspection
costs 1,099 1,176 222 1,490 1,930 2,158 897 1,274
Other 367 875 33 764 545 309 169 137
------- --------
Revenues less
direct operating
expenses $ 1,824 $ 6,897 --- --- --- --- --- ---
======== ========
Depreciation and
amortization 502 2,786 2,740 4,478 1,818 4,676
-------- -------- -------- -------- -------- ---------
Operating income 2,090 4,772 1,986 19,112 4,843 23,746
Interest expense 620 3,767 3,850 2,282 1,660 1,514
Amortization of
deferred financing costs 60 344 381 263 187 35
Gain on sale of assets --- --- (244) (59) --- (253)
Other income, net --- (51) (32) (79) (41) (80)
Income tax expense (benefit) 564 226 (670) 5,814 1,055 7,885
Extraordinary item, net of taxes --- --- --- (917) (917) ---
-------- -------- -------- -------- -------- ---------
Net income (loss) $ 846 $ 486 $ (1,299) $ 9,974 $ 1,065 $ 14,645
======== ======== ========= ========= ========= =========
Income (loss) per share before
extraordinary item(2) $ 0.14 $ 0.08 $ (0.22) $ 0.88 $ 0.22 $ 0.87
Extraordinary item
per share(2) --- --- --- (0.08) (0.10) ---
-------- -------- --------- --------- --------- ---------
Net income (loss) per share(2) $ 0.14 $ 0.08 $ (0.22) 0.80 0.12 0.87
======== ======== ========= ========= ========= =========
Weighted average
common shares(2) 6,040 6,020 6,101 12,380 9,091 16,859
======== ======== ========= ========= ========= =========
Other Financial Data:
Capital expenditures:
Acquisitions --- --- 1,475 71,030 14,469 37,141
Vessel construction/major
upgrades --- 30 3,474 7,232 1,059 4,986
Maintenance and other 17 2,141 2,509 3,165 791 5,886
Ratios:
Earnings to fixed charges 3.1x 1.2x --(3) 7.4x 2.6x 15.5x
</TABLE>
<TABLE>
<CAPTION>
1993(1)
----------------------------- Six months
Ten months Two months ended
ended ended Year ended December 31, June 30,
October 28, December 31, ----------------------------- ---------------------
1993 1993 1994 1995 1996 1996 1997
------------ ------------ -------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Operating Data:
Supply boats:
Average number of vessels 16.0 16.0 16.0 16.0 21.2 17.3 36.9
Average vessel utilization rate(4) 85% 90% 77% 78% 94% 93% 86%
Average vessel day rate(5) $ 2,833 $ 3,253 $ 3,057 $ 3,060 $ 4,917 $ 3,887 $ 6,833
Lift boats:
Average number of vessels 5.0 5.0 5.0 5.9 6.0 6.0 6.0
Average vessel utilization rate(4) 70% 57% 57% 45% 67% 61% 69%
Average vessel day rate(5) $ 4,735 $ 4,970 $ 5,017 $ 4,656 $ 4,995 $ 4,710 $ 5,507
Crew/line handling boats:(6)
Average number of vessels 24.0 23.0 22.3 16.8 23.3 21.7 24.5
Average vessel utilization rate(4) 93% 91% 82% 85% 95% 94% 97%
Average vessel day rate(5) $ 1,401 $ 1,500 $ 1,465 $ 1,480 $ 1,579 $ 1,527 $ 1,919
</TABLE>
<TABLE>
<CAPTION>
December 31,
------------------------------------------- June 30,
1993 1994 1995 1996 1997
--------- --------- -------- ---------- ----------
(In thousands)
<S> <C> <C> <C> <C> <C>
Balance Sheet Data:
Working capital (deficit),
including current
maturities of long-term
debt $ (2,704) $ 1,550 $ (844) $ 10,073 $ 16,882
Property and equipment, net 45,191 38,508 39,264 119,142 156,337
Total assets 55,207 51,419 52,113 143,355 194,098
Long-term debt 37,560 35,452 36,780 21,000 49,500
Stockholders' equity 6,450 7,002 5,712 103,980 118,700
</TABLE>
(1) Reflects the historical results of operations of the Company for
the two months ended December 31, 1993 and the historical results
of operations for the vessels acquired from Chrysler on October
29, 1993, for the ten months ended October 28, 1993 and the year
ended December 31, 1992. Accordingly, interest expense, other
income, net, income tax expense, depreciation and amortization and
net income are not presented for such vessels because such items
would be based on Chrysler's historical cost and borrowings and
are not relevant to the ongoing results of the Company.
(2) Share and per share amounts for the two months ended December 31,
1993 and for the years ended December 31, 1994 and 1995 have been
adjusted to reflect a stock dividend of 3.0253 shares per share of
Common Stock effective April 26, 1996. Additionally, share and
per share amounts for the two months ended December 31, 1993, for
the years ended December 31, 1994, 1995 and 1996, and for the six
months ended June 30, 1996 and 1997 have been adjusted to reflect
a 100% stock dividend effective June 9, 1997.
(3) Earnings were insufficient to cover fixed charges, and fixed
charges exceeded earnings by approximately $2.0 million.
(4) Average utilization rates are average rates for all vessels based
on a 365-day year. Vessels are considered utilized when they are
being operated or being mobilized/demobilized under contracts with
customers.
(5) Average day rates are the average of revenue per day per vessel
under contract.
(6) Average utilization and day rates for all line handling vessels
reflect the contract rates for the Company's unconsolidated
Brazilian operating company.
THE EXCHANGE OFFER
Purpose and Effect
The Old Notes were sold by the Company on July 21, 1997 to the
Initial Purchasers in a private transaction not subject to the
registration requirements of the Securities Act. The Initial Purchasers
offered and sold the Old Notes only (i) to "qualified institutional
buyers" (as defined in Rule 144A) in compliance with Rule 144A and (ii)
to a limited number of other institutional "accredited investors" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act)
that, prior to their purchase of Old Notes, delivered to the Initial
Purchasers a letter containing certain representations and agreements.
In connection with the sale of the Old Notes, the Company entered into
the Registration Rights Agreement, which requires that the Company and
the Guarantors conduct the Exchange Offer. The Registration Rights
Agreement further provides that the Company and the Guarantors must use
their reasonable best efforts to (i) cause the Exchange Offer
Registration Statement to be declared effective on or before the 120th
day after the date on which the Old Notes were originally issued under
the Indenture (the "Closing Date") and (ii) consummate the Exchange
Offer on or before the 180th day after the Closing Date. Except as
provided below, upon the completion of the Exchange Offer, the Company's
obligation with respect to the registration of the Old Notes and the New
Notes will terminate. The summary herein of certain provisions of the
Registration Rights Agreement does not purport to be complete and is
subject to, and is qualified in its entirety by reference thereto.
Copies of the Registration Rights Agreement are available as set forth
under "Description of the Notes -- Additional Information." As a result
of the filing and the effectiveness of the Exchange Offer Registration
Statement, certain Liquidated Damages provided for in the Registration
Rights Agreement will not become payable by the Company. Following the
completion of the Exchange Offer (except as set forth in the paragraph
immediately below), certain holders of Old Notes not tendered will not
have any further registration rights and those Old Notes will continue
to be subject to certain restrictions on transfer. Accordingly, the
liquidity of the market for the Old Notes could be adversely affected
upon completion of the Exchange Offer.
In order to participate in the Exchange Offer, a holder must
represent to the Company, among other things, that (i) the New Notes
acquired pursuant to the Exchange Offer are being obtained in the
ordinary course of such holder's business, (ii) such holder is not
engaging in and does not intend to engage in a distribution of the New
Notes, (iii) such holder does not have an arrangement or understanding
with any person to participate in the distribution of the New Notes and
(iv) such holder is not an "affiliate," as defined under Rule 405
promulgated under the Securities Act, of the Company. Pursuant to the
Registration Rights Agreement, the Company is required to file a Shelf
Registration Statement for a continuous offering pursuant to Rule 415
under the Securities Act in respect of the Old Notes (and cause such
shelf registration statement to be declared effective by the Commission
and keep it continuously effective, supplemented and amended for
prescribed periods) if (i) the Company is not permitted to consummate
the Exchange Offer because the Exchange Offer is not permitted by
applicable law or Commission policy, or (ii) any holder of Transfer
Restricted Securities notifies the Company prior to the 20th day
following consummation of the Exchange Offer (A) that such holder is
prohibited by law or Commission policy from participating in the
Exchange Offer or (B) that such holder may not resell the New Notes
acquired by it in the Exchange Offer to the public without delivering a
prospectus and the prospectus contained in the Exchange Offer
Registration Statement would not be available for such resale by such
holder. Other than as set forth in this paragraph, no holder will have
the right to participate in the Shelf Registration Statement nor
otherwise to require that the Company register such holder's shares of
Old Notes under the Securities Act. See "Description of the Notes --
Registration Rights; Liquidated Damages."
The Company has not requested, and does not intend to request, an
interpretation by the staff of the Commission with respect to whether
the New Notes issued pursuant to the Exchange Offer in exchange for the
Old Notes may be offered for sale, resold or otherwise transferred by
any holder without compliance with the registration and prospectus
delivery provisions of the Securities Act. Based on interpretations by
the staff of the Commission set forth in no-action letters issued to
third parties unrelated to the Company and the Guarantors, the Company
and the Guarantors believe that New Notes issued pursuant to the
Exchange Offer in exchange for Old Notes may be offered for resale,
resold and otherwise transferred by holders thereof (other than any such
holder or such other person that is an "affiliate" of the Company within
the meaning of Rule 405 under the Securities Act), without compliance
with the registration and prospectus delivery provisions of the
Securities Act, provided that (i) the New Notes are acquired in the
ordinary course of such holder's business, (ii) such holder is not
engaging in and does not intend to engage in a distribution of the New
Notes, and (iii) such holder does not have an arrangement or
understanding with any person to participate in the distribution of the
New Notes. Any holder who tenders in the Exchange Offer with the
intention to participate, or for the purpose of participating, in a
distribution of the New Notes or who is an affiliate of the Company may
not rely upon such interpretation by the staff of the Commission and, in
the absence of an exemption therefrom, must comply with the registration
and prospectus delivery requirements of the Securities Act in connection
with any secondary resale transaction. Failure to comply with such
requirements in such instance may result in such holder incurring
liabilities under the Securities Act for which the holder is not
indemnified by the Company. Each broker-dealer that receives New Notes
for its own account in exchange for Old Notes, where those Old Notes
were acquired by the broker-dealer as a result of its market-making
activities or other trading activities, must acknowledge that it will
deliver a prospectus in connection with any resale of these New Notes.
The Letter of Transmittal states that by so acknowledging and by
delivering a prospectus, a broker-dealer will not be deemed to admit
that it is an "underwriter" within the meaning of the Securities Act.
The Company has agreed that, for a period of one year after the
effective date of the Exchange Offer Registration Statement, it will
make the Prospectus available to any broker-dealer for use in connection
with any such resale.
The Exchange Offer is not being made to, nor will the Company
accept surrenders for exchange from, holders of Old Notes in any
jurisdiction in which this Exchange Offer or the acceptance thereof
would not be in compliance with the securities or blue sky laws of such
jurisdiction.
Participation in the Exchange Offer is voluntary and holders
should carefully consider whether to accept. Holders of the Old Notes
are urged to consult their financial and tax advisors in making their
own decisions on whether to participate in the Exchange Offer.
Consequences of Failure to Exchange
Old Notes which are not tendered for exchange in the Exchange
Offer will remain outstanding and interest thereon will continue to
accrue. Following the completion of the Exchange Offer (except as set
forth above in the second paragraph under "-- Purpose and Effect"),
holders of Old Notes not tendered will not have any further registration
rights and those Old Notes will remain restricted securities within the
meaning of Rule 144 of the Securities Act. Accordingly, the liquidity
of the market for a holder's Old Notes could be adversely affected upon
completion of the Exchange Offer if the holder does not participate in
the Exchange Offer.
Terms of the Exchange Offer
General
Upon the terms and subject to the conditions set forth in this
Prospectus and in the Letter of Transmittal, the Company will accept any
and all Old Notes validly tendered and not withdrawn prior to 5:00 p.m.,
New York City time, on the Expiration Date. The Company will issue
$1,000 principal amount of New Notes in exchange for each $1,000
principal amount of outstanding Old Notes accepted in the Exchange
Offer. Holders may tender some or all of their Old Notes pursuant to
the Exchange Offer. However, Old Notes may be tendered only in integral
multiples of $1,000 in principal amount.
The form and terms of the New Notes are identical in all material
respects to the form and terms of the Old Notes except that (i) the New
Notes are being registered under the Securities Act and, therefore, will
not bear legends restricting their transfer and (ii) holders of the New
Notes, other than certain broker-dealers, will not be entitled to the
rights of holders of the Transfer Restricted Securities under the
Registration Rights Agreement. The New Notes will evidence the same
debt as the Old Notes, will be issued pursuant to, and entitled to the
benefits of, the Indenture pursuant to which the Old Notes were issued
and will be treated as a single class thereunder with any Old Notes that
remain outstanding. The Exchange Offer is not conditioned upon any
minimum aggregate principle amount of Old Notes being tendered for
exchange.
As of August 15, 1997, the Old Notes representing $110,000,000
aggregate principal amount were outstanding and there were three
registered holders. This Prospectus, together with the Letter of
Transmittal, is being sent to such registered holders and to others
believed to have beneficial interests in the Old Notes. Holders of Old
Notes do not have any appraisal or dissenters' rights under the General
Corporation Law of the State of Delaware or the Indenture in connection
with the Exchange Offer. The Company intends to conduct the Exchange
Offer in accordance with the applicable requirements of the Exchange Act
and the rules and regulations of the Commission promulgated thereunder.
As of the date of this Prospectus, $110,000,000 aggregate
principal amount of Old Notes are issued and outstanding. In connection
with the issuance of the Old Notes, the Company arranged for the Old
Notes to be eligible for trading in the Private Offering, Resale and
Trading through Automated Linkages (PORTAL) Market, the National
Association of Securities Dealers' screen based, automated market
trading of securities eligible for resale under Rule 144A.
The Company will be deemed to have accepted validly tendered Old
Notes when, as and if the Company has given oral or written notice
thereof to the Exchange Agent. The Exchange Agent will act as agent for
the tendering holders for the purpose of receiving the New Notes from
the Company and delivering the New Notes to such holders. If any
tendered Old Notes are not accepted for exchange because of an invalid
tender, the occurrence of certain other events set forth herein or
otherwise, certificates for any such unaccepted Old Notes will be
returned, without expense, to the tendering holder thereof as promptly
as practicable after the Expiration Date.
Holders who tender Old Notes in the Exchange Offer will not be
required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect
to the exchange of Old Notes pursuant to the Exchange Offer. The
Company will pay all charges and expenses, other than certain applicable
taxes, in connection with the Exchange Offer. See "--Fees and
Expenses."
Expiration Date; Extensions; Amendments
The term "Expiration Date" shall mean 5:00 p.m., New York City
time, on September 30, 1997, unless the Company, in its sole discretion,
extends the Exchange Offer, in which case the term "Expiration Date"
shall mean the latest date and time to which the Exchange Offer is
extended. In order to extend the Exchange Offer, the Company will
notify the Exchange Agent and each registered holder of any extension by
oral or written notice prior to 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date.
During any extension of the Exchange Offer, all Old Notes previously
tendered pursuant to the Exchange Offer and not withdrawn will remain
subject to the Exchange Offer. The date of the exchange of the New
Notes for Old Notes will be the first Nasdaq National Market ("NNM")
trading day following the Expiration Date.
The Company reserves the right, in its sole discretion, (i) to
delay accepting any Old Notes, to extend the Exchange Offer or, if any
of the conditions set forth under "The Exchange Offer -- Conditions to
Exchange Offer" have not been satisfied and have not been waived by the
Company, to terminate the Exchange Offer, by giving oral or written
notice of such delay, extension or termination to the Exchange Agent, or
(ii) to amend the terms of the Exchange Offer in any manner deemed by it
to be advantageous to the holders of the Old Notes. Any such delay in
acceptance, extension, termination or amendment will be followed as
promptly as practicable by oral or written notice thereof to the
registered holders. If the Exchange Offer is amended in any manner
determined by the Company to constitute a material change, the Company
will promptly disclose such amendment by means of a prospectus
supplement that will be distributed to the registered holders, and the
Company will extend the Exchange Offer for a period of time, depending
upon the significance of the amendment and the manner of disclosure to
the registered holders, if the Exchange Offer would otherwise expire
during such period.
Interest on the New Notes
The New Notes will bear interest payable semi-annually on February
1 and August 1 of each year, commencing February 1, 1998. Holders of
New Notes of record on January 15, 1998 will receive interest on
February 1, 1998 from the date of issuance of the New Notes, plus an
amount equal to the accrued interest on the Old Notes from the date of
issuance of the Old Notes, July 21, 1997, to the date of exchange
thereof. Consequently, assuming the Exchange Offer is consummated prior
to the record date in respect of the February 1, 1998 interest payment
for the Old Notes, holders who exchange their Old Notes for New Notes
will receive the same interest payment on February 1, 1998 that they
would have received had they not accepted the Exchange Offer. Interest
on the Old Notes accepted for exchange will cease to accrue upon
issuance of the New Notes.
Procedures for Tendering Old Notes
The tender to the Company of Old Notes by a holder thereof
pursuant to one of the procedures set forth below will constitute an
agreement between such holder and the Company in accordance with the
terms and subject to the conditions set forth herein and in the Letter
of Transmittal. A holder of the Old Notes may tender such Old Notes by
(i) properly completing, signing and dating a Letter of Transmittal or a
facsimile thereof (all references in this Prospectus to a Letter of
Transmittal shall be deemed to include a facsimile thereof) and
delivering the same, together with any corresponding certificate or
certificates representing the Old Notes being tendered (if in
certificated form) and any required signature guarantees, to the
Exchange Agent at its address set forth in the Letter of Transmittal on
or prior to the Expiration Date (or complying with the procedure for
book-entry transfer described below), or (ii) complying with the
guaranteed delivery procedures described below.
If tendered Old Notes are registered in the name of the signer of
the Letter of Transmittal and the New Notes to be issued in exchange
therefor are to be issued (and any untendered Old Notes are to be
reissued) in the name of the registered holder (which term, for the
purposes described herein, shall include any participant in DTC (also
referred to as a book-entry facility) whose name appears on a security
listing as the owner of Old Notes), the signature of such signer need
not be guaranteed. In any other case, the tendered Old Notes must be
endorsed or accompanied by written instruments of transfer in form
satisfactory to the Company and duly executed by the registered holder
and the signature on the endorsement or instrument of transfer must be
guaranteed by an eligible guarantor institution that is a member of or a
participant in the Securities Transfer Agents Medallion Program, the New
York Stock Exchange Medallion Signature Program, the Stock Exchange
Medallion Program or an "eligible guarantor institution" within the
meaning of Rule 17Ad-15 under the Exchange Act (an "Eligible
Institution"). If the New Notes or Old Notes not exchanged are to be
delivered to an address other than that of the registered holder
appearing on the note register for the Old Notes, the signature in the
Letter of Transmittal must be guaranteed by an Eligible Institution.
THE METHOD OF DELIVERY OF OLD NOTES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT THE ELECTION
AND RISK OF THE HOLDER. IF SUCH DELIVERY IS BY MAIL, IT IS RECOMMENDED
THAT REGISTERED MAIL, PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED,
BE USED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE
DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. NO LETTER OF
TRANSMITTAL OR OLD NOTES SHOULD BE SENT TO THE COMPANY. ONLY HOLDERS OF
OLD NOTES MAY TENDER SUCH OLD NOTES IN THE EXCHANGE OFFER. HOLDERS MAY
REQUEST THEIR RESPECTIVE BROKERS, DEALERS, COMMERCIAL BANKS, TRUST
COMPANIES, OR NOMINEES TO EFFECT THESE TRANSACTIONS FOR SUCH HOLDERS.
Any beneficial owner whose Old Notes are registered in the name of
a broker, dealer, commercial bank, trust company, or other nominee and
who wishes to tender should contact the registered holder promptly and
instruct the registered holder to tender on the beneficial owner's
behalf. If the beneficial owner wishes to tender on the owner's own
behalf, the owner must, prior to completing and executing the Letter of
Transmittal and delivering the owner's Old Notes, either make
appropriate arrangements to register ownership of the Old Notes in the
beneficial owner's name or obtain a properly completed bond power from
the registered holder. The transfer of registered ownership may take
considerable time.
The Company understands that the Exchange Agent has confirmed with
DTC that any financial institution that is a participant in DTC's system
may utilize DTC's Automated Tender Offer Program ("ATOP") to tender Old
Notes. The Company further understands that the Exchange Agent will
request, within two business days after the date the Exchange Offer
commences, that DTC establish an account with respect to the Old Notes
for the purpose of facilitating the Exchange Offer, and any participant
may make book-entry delivery of Old Notes by causing DTC to transfer
such Old Notes into the Exchange Agent's account in accordance with
DTC's ATOP procedures for transfer. However, the exchange of the Old
Notes so tendered will only be made after timely confirmation (a "Book-
Entry Confirmation") of such book-entry transfer and timely receipt by
the Exchange Agent of an Agent's Message (as defined in the next
sentence), and any other documents required by the Letter of
Transmittal. The term "Agent's Message" means a message, transmitted by
DTC and received by the Exchange Agent and forming a part of Book-Entry
Confirmation, which states that DTC has received an express
acknowledgment from a participant tendering Old Notes which are the
subject of such Book-Entry Confirmation and that such participant has
received and agrees to be bound by the terms of the Letter of
Transmittal and that the Company may enforce such agreement against such
participant.
A tender will be deemed to have been received as of the date when
(i) the tendering holder's properly completed and duly signed Letter of
Transmittal accompanied by the Old Notes (or a confirmation of book-
entry transfer of such Old Notes into the Exchange Agent's account at
DTC), is received by the Exchange Agent, or (ii) a Notice of Guaranteed
Delivery or letter, telegram or facsimile transmission to similar effect
from an Eligible Institution is received by the Exchange Agent.
Issuances of New Notes in exchange for Old Notes tendered pursuant to a
Notice of Guaranteed Delivery or letter, telegram or facsimile
transmission to similar effect by an Eligible Institution will be made
only against submission of a duly signed Letter of Transmittal (and any
other required documents) and deposit of the tendered Old Notes.
All questions as to the validity, form, eligibility (including
time of receipt), acceptance, and withdrawal of tendered Old Notes will
be determined by the Company, in its sole discretion, which
determination will be final and binding. The Company reserves the
absolute right to reject any or all tenders not in proper form or the
acceptance for exchange of which may, in the opinion of counsel for the
Company, be unlawful. The Company also reserves the absolute right to
waive any of the conditions of the Exchange Offer or any defect or
irregularity in the tender of any Old Notes. The Company's
interpretation of the terms and conditions of the Exchange Offer
(including the instructions in the Letter of Transmittal) will be final
and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of Old Notes must be cured
within such time as the Company shall determine. Although the Company
intends to notify holders of defects or irregularities with respect to
tenders of Old Notes, neither the Company, the Exchange Agent, nor any
other person shall be under any duty to give notification of any defects
or irregularities in tenders or incur any liability for failure to give
such notification. Tenders of Old Notes will not be deemed to have been
made until such defects or irregularities have been cured or waived.
Any Old Notes received by the Exchange Agent that are not properly
tendered and as to which the defects or irregularities have not been
cured or waived will be returned by the Exchange Agent to the tendering
holders, unless otherwise provided in the Letter of Transmittal, as soon
as practicable following the Expiration Date.
In addition, the Company reserves the right in its sole discretion
to purchase or make offers for any Old Notes that remain outstanding
after the Expiration Date or, as set forth under "Conditions to the
Exchange Offer," to terminate the Exchange Offer and, to the extent
permitted by applicable law, purchase Old Notes in the open market, in
privately negotiated transactions, or otherwise. The terms of any such
purchases or offers could differ from the terms of the Exchange Offer.
In all cases, issuance of New Notes for Old Notes that are
accepted for exchange pursuant to the Exchange Offer will be made only
after timely receipt by the Exchange Agent of certificates for such Old
Notes or a timely Book-Entry Confirmation of such Old Notes into the
Exchange Agent's account at DTC, a properly completed and duly executed
Letter of Transmittal (or, with respect to DTC and its participants,
electronic instructions in which the tendering holder acknowledges its
receipt of and agreement to be bound by the Letter of Transmittal), and
all other required documents. If any tendered Old Notes are not
accepted for any reason set forth in the terms and conditions of the
Exchange Offer or if Old Notes are submitted for a greater principal
amount than the holder desires to exchange, such unaccepted or non-
exchanged Old Notes will be returned without expense to the tendering
Holder thereof (or, in the case of Old Notes tendered by book-entry
transfer into the Exchange Agent's account at DTC pursuant to the book-
entry transfer procedures described below, such nonexchanged Old Notes
will be credited to an account maintained with such book-entry transfer
facility) as promptly as practicable after the expiration or termination
of the Exchange Offer.
Each broker-dealer that receives New Notes for its own account in
exchange for Old Notes, where the Old Notes were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes.
Guaranteed Delivery Procedures
If the holder desires to accept the Exchange Offer and time will
not permit a Letter of Transmittal or Old Notes to reach the Exchange
Agent before the Expiration Date or the procedure for book-entry
transfer cannot be completed on a timely basis, a tender may be effected
if the Exchange Agent has received at its office, on or prior to the
Expiration Date, a letter, telegram or facsimile transmission from an
Eligible Institution setting forth the name and address of the tendering
holder, the name(s) in which the Old Notes are registered and the
certificate number(s) of the Old Notes to be tendered, and stating that
the tender is being made thereby and guaranteeing that, within three NNM
trading days after the date of execution of such letter, telegram or
facsimile transmission by the Eligible Institution, such Old Notes, in
proper form for transfer (or a confirmation of book-entry transfer of
such Old Notes into the Exchange Agent's account at DTC), will be
delivered by such Eligible Institution together with a properly
completed and duly executed Letter of Transmittal (and any other
required documents). Unless Old Notes being tendered by the above-
described method are deposited with the Exchange Agent within the time
period set forth above (accompanied or preceded by a properly completed
Letter of Transmittal and any other required documents), the Company
may, at its option, reject the tender. Copies of a Notice of Guaranteed
Delivery which may be used by Eligible Institutions for the purposes
described in this paragraph are available from the Exchange Agent.
Terms and Conditions of the Letter of Transmittal
The Letter of Transmittal contains, among other things, certain
terms and conditions which are summarized below and are part of the
Exchange Offer.
Each holder who participates in the Exchange Offer will be
required to represent that any New Notes received by it will be acquired
in the ordinary course of its business, that such holder is not
participating in, and has no arrangement with any person to participate
in, the distribution (within the meaning of the Securities Act) of the
New Notes, and that such holder is not an affiliate of the Company.
Old Notes tendered in exchange for New Notes (or a timely
confirmation of a book-entry transfer of such Old Notes into the
Exchange Agent's account at DTC) must be received by the Exchange Agent,
with the Letter of Transmittal and any other required documents, by the
Expiration Date or within the time periods set forth above pursuant to a
Notice of Guaranteed Delivery from an Eligible Institution. Each holder
tendering the Old Notes for exchange sells, assigns and transfers the
Old Notes to the Exchange Agent, as agent of the Company, and
irrevocably constitutes and appoints the Exchange Agent as the holder's
agent and attorney-in-fact to cause the Old Notes to be transferred and
exchanged. The holder warrants that it has full power and authority to
tender, exchange, sell, assign and transfer the Old Notes and to acquire
the New Notes issuable upon the exchange of such tendered Old Notes,
that the Exchange Agent, as agent of the Company, will acquire good and
unencumbered title to the tendered Old Notes, free and clear of all
liens, restrictions, charges and encumbrances, and that the Old Notes
tendered for exchange are not subject to any adverse claims when
accepted by the Exchange Agent, as agent of the Company. The holder
also warrants and agrees that it will, upon request, execute and deliver
any additional documents deemed by the Company or the Exchange Agent to
be necessary or desirable to complete the exchange, sale, assignment and
transfer of the Old Notes. All authority conferred or agreed to be
conferred in the Letter of Transmittal by the holder will survive the
death, incapacity or dissolution of the holder and any obligation of the
holder shall be binding upon the heirs, personal representatives,
successors and assigns of such holder.
Withdrawal Rights
Except as otherwise provided herein, tenders of Old Notes may be
withdrawn at any time prior to 5:00 p.m., New York City time, on the
Expiration Date unless previously accepted for exchange.
To withdraw a tender of Old Notes in the Exchange Offer, a
written, facsimile or (for DTC participation) electronic ATOP
transmission notice of withdrawal must be received by the Exchange Agent
at its address set forth herein prior to 5:00 p.m., New York City time,
on the Expiration Date prior to acceptance for exchange thereof by the
Company. Any such notice of withdrawal must (i) specify the name of the
person having deposited the Old Notes to be withdrawn (the "Depositor"),
(ii) identify the Old Notes to be withdrawn (including the certificate
number or numbers and principal amount of such Old Notes), (iii) contain
a statement that such holder is withdrawing its election to have such
Old Notes exchanged, (iv) be signed by the holder in the same manner as
the original signature on the Letter of Transmittal by which such Old
Notes were tendered (including any required signature guarantees) or be
accompanied by documents of transfer sufficient to have the Trustee
register the transfer of such Old Notes in the name of the person
withdrawing the tender, and (v) specify the name in which any such Old
Notes are to be registered, if different from that of the Depositor. If
Old Notes have been tendered pursuant to the procedure for book-entry
transfer, any notice of withdrawal must specify the name and number of
the account at the book-entry transfer facility. All questions as to
the validity, form, and eligibility (including time of receipt) of such
notices will be determined by the Company, whose determination shall be
final and binding on all parties. Any Old Notes so withdrawn will be
deemed not to have been validly tendered for purposes of the Exchange
Offer and no Exchange Notes will be issued with respect thereto unless
the Old Notes so withdrawn are validly returned. Any Old Notes which
have been tendered but which are not exchanged for any reason will be
returned to the holder thereof without cost to such holder as soon as
practicable after withdrawal, rejection of tender, or termination of the
Exchange Offer. Properly withdrawn Old Notes may be retendered by
following one of the procedures (described above) under "-- Procedures
for Tendering Old Notes" at any time on or prior to the Expiration Date.
Conditions to the Exchange Offer
Notwithstanding any other provision of the Exchange Offer, the
Company will not be required to accept for exchange, or to issue New
Notes in exchange for, any Old Notes and may terminate or amend the
Exchange Offer if at any time before the acceptance of such Old Notes
for exchange or the exchange of the New Notes for such Old Notes, the
Company determines that the Exchange Offer violates applicable law or
Commission policy.
If the Company determines that it may terminate the Exchange
Offer, as set forth above, the Company may (i) refuse to accept any Old
Notes and return any Old Notes that have been tendered to the holders
thereof, (ii) extend the Exchange Offer and retain all Old Notes
tendered prior to the Expiration of the Exchange Offer, subject to the
rights of such holders of tendered Old Notes to withdraw their tendered
Old Notes or (iii) waive such termination event with respect to the
Exchange Offer and accept all properly tendered Old Notes that have not
been withdrawn. If such waiver constitutes a material change in the
Exchange Offer, the Company will disclose such change by means of a
supplement to this Prospectus that will be distributed to each
registered holder of Old Notes, and the Company will extend the Exchange
Offer for a period of time, depending upon the significance of the
waiver and the manner of disclosure to the registered holders of the Old
Notes, if the Exchange Offer would otherwise expire during such period.
Holders of Old Notes will have certain rights against the Company under
the Registration Rights Agreement should the Company fail to consummate
the Exchange Offer. See "Description of the Notes -- Registration
Rights; Liquidated Damages."
The foregoing conditions are for the sole benefit of the Company
and may be asserted by the Company regardless of the circumstances
giving rise to any such condition or may be waived by the Company in
whole or in part at any time and from time to time in its sole
discretion. The failure by the Company at any time to exercise any of
the foregoing rights shall not be deemed a waiver of any such right and
each such right shall be deemed an ongoing right which may be asserted
at any time and from time to time.
In addition, the Company will not accept for exchange any Old
Notes tendered, and no New Notes will be issued in exchange for, any
such Old Notes, if at such time any stop order shall be threatened or in
effect with respect to the Registration Statement of which this
Prospectus constitutes a part of the qualification of the Indenture
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"). In any such event the Company is required to use every
reasonable effort to obtain the withdrawal of any stop order at the
earliest possible time.
Exchange Agent
Texas Commerce Bank National Association has been appointed as
Exchange Agent for the Exchange Offer. Questions and requests for
assistance and requests for additional copies of this Prospectus or of
the Letter of Transmittal should be directed to the Exchange Agent
addressed as follows:
For Information by Telephone:
(214) 672-5125
or
(800) 275-2048
By Registered or Certified Mail: By Hand or Overnight Delivery Service:
Texas Commerce Bank National Texas Commerce Bank National
Association Association
Corporate Trust Services Corporate Trust Services
P. O. Box 2320 1201 Main Street, 18th Floor
Dallas, Texas 75221-2320 Dallas, Texas 75202
Attn: Frank Ivins Attn: Frank Ivins
By Facsimile Transmission (for Eligible Institutions only):
(214) 672-5746
(Facsimile Confirmation)
(214) 672-5125
or
(800) 275-2048
Fees and Expenses
The expenses of soliciting tenders will be borne by the Company.
The principal solicitation is being made by mail; however, additional
solicitations may be made by telecopy, telephone or in person by
officers and regular employees of the Company. No additional
compensation will be paid to any such officers and employees who engage
in soliciting tenders. The Company will not make any payments to
brokers, dealers or other persons soliciting acceptances of the Exchange
Offer. The Company, however, will pay the Exchange Agent reasonable and
customary fees for its services and will reimburse the Exchange Agent
for its reasonable out-of-pocket expenses in connection therewith. The
Company may also pay brokerage houses and other custodians, nominees and
fiduciaries the reasonable out-of-pocket expenses incurred by them in
forwarding copies of this Prospectus, Letters of Transmittal and related
documents to the beneficial owners of the Old Notes and in handling or
forwarding tenders for exchange.
The estimated cash expenses to be incurred in connection with the
Exchange Offer, including fees and expenses of the Exchange Agent,
accounting, legal and related fees and expenses, will be paid by the
Company.
DESCRIPTION OF THE NOTES
General
The Old Notes were issued pursuant to an Indenture dated July 21,
1997 between the Company, the initial Guarantors (as defined below) and
Texas Commerce Bank National Association, as trustee (the "Trustee").
The New Notes will be issued under the Indenture, which will be
qualified under the Trust Indenture Act, upon the effectiveness of the
Registration Statement of which this Prospectus forms a part. The terms
of the Notes will include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act. The
Notes will be subject to all such terms, and prospective investors are
referred to the Indenture and the Trust Indenture Act for a statement
thereof. The following summary of certain provisions of the Indenture
does not purport to be complete. Copies of the Indenture and the
Registration Rights Agreement are available as set forth under "--
Additional Information." The definitions of certain terms used in the
following summary are set forth below under "--Certain Definitions." As
used in this "Description of the Notes," the "Company" means Trico
Marine Services, Inc., but not any of its subsidiaries.
The Notes will be general unsecured obligations of the Company,
ranking pari passu in right of payment with all other future senior
borrowings of the Company and senior in right of payment to any
subordinated indebtedness incurred by the Company in the future. The
Notes will be effectively subordinated, however, to all future secured
obligations of the Company to the extent of the assets securing such
obligations and to all current and future obligations of the
Subsidiaries of the Company that are not Guarantors. As of June 30,
1997, after giving pro forma effect to the Original Offering and the use
of proceeds therefrom, the Notes would have been effectively
subordinated to approximately $8.4 million of secured borrowings. The
Indenture permits the Company and its Subsidiaries to incur additional
indebtedness, including additional secured indebtedness, under certain
circumstances. See "Risk Factors--Substantial Indebtedness,"
"Capitalization" and "--Certain Covenants--Incurrence of Indebtedness
and Issuance of Preferred Stock."
Any Old Notes that remain outstanding after the completion of the
Exchange Offer, together with the New Notes issued in connection with
the Exchange Offer, will be treated as a single class of securities
under the Indenture.
As of the date of the Indenture, all of the Company's principal
operating Subsidiaries are Restricted Subsidiaries. Under certain
circumstances, the Company will be able to designate current or future
Subsidiaries as Unrestricted Subsidiaries. Unrestricted Subsidiaries
will not be subject to many of the restrictive covenants set forth in
the Indenture.
Principal, Maturity and Interest
The Notes will be limited in aggregate principal amount to $110.0
million and will mature on August 1, 2005. Interest on the Notes will
accrue at the rate of 8.50% per annum and will be payable semi-annually
in arrears on February 1 and August 1 of each year, commencing on
February 1, 1998, to holders of record on the immediately preceding
January 15 and July 15. Interest on the Notes will accrue from the
most recent date to which interest has been paid or, if no interest has
been paid, from the date of original issuance of the Old Notes.
Interest will be computed on the basis of a 360-day year comprised of
twelve 30-day months. Principal of and premium, interest and Liquidated
Damages, if any, on the Notes will be payable at the office or agency of
the Company maintained for such purpose or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check
mailed to holders of the Notes at their respective addresses set forth
in the register of holders; provided, however, that all payments with
respect to Notes the holders of which have given wire transfer
instructions to the Company will be required to be made by wire transfer
of immediately available funds to the accounts specified by the holders
thereof. Until otherwise designated by the Company, the Company's
office or agency will be the office of the Trustee maintained for such
purpose. The Notes will be issued in denominations of $1,000 and
integral multiples thereof.
Subsidiary Guarantees
The Company's payment obligations under the Notes will be jointly
and severally guaranteed (the "Subsidiary Guarantees") by all of the
Company's present and future Significant Subsidiaries ("Guarantors").
The obligations of each Guarantor under its Subsidiary Guarantee will be
a general unsecured obligation of such Guarantor, ranking pari passu in
right of payment with all other current or future senior borrowings of
such Guarantor, including borrowings under the Credit Facility, and
senior in right of payment to any subordinated indebtedness, if any,
incurred by such Guarantor in the future. The Guarantors will be
effectively subordinated, however, to all current and future secured
obligations of the Guarantors, including borrowings under the Credit
Facility.
The Indenture provides that no Guarantor may consolidate with or
merge with or into (whether or not such Guarantor is the surviving
Person) another Person (other than the Company or another Guarantor),
whether or not affiliated with such Guarantor, unless (i) subject to the
provisions of the following paragraph, the Person formed by or surviving
any such consolidation or merger (if other than such Guarantor) shall
execute a Guarantee and deliver an Opinion of Counsel in accordance with
the terms of the Indenture; (ii) immediately after giving effect to such
transaction, no Default or Event of Default exists; (iii) such
Guarantor, or any Person formed by or surviving any such consolidation
or merger, would have Consolidated Net Worth (immediately after giving
effect to such transaction), equal to or greater than the Consolidated
Net Worth of such Guarantor immediately preceding the transaction and
(iv) the Company would be permitted by virtue of the Company's pro forma
Consolidated Interest Coverage Ratio, immediately after giving effect to
such transaction, to incur at least $1.00 of additional Indebtedness
pursuant to the Consolidated Interest Coverage Ratio test set forth in
the covenant described below the caption "--Certain Covenants--
Incurrence of Indebtedness and Issuance of Preferred Stock."
The Indenture provides that, in the event of a sale or other
disposition (including by way of merger or consolidation) of all of the
assets or Capital Stock of any Guarantor, then such Guarantor will be
released and relieved of any obligations under its Subsidiary Guarantee;
provided, however, that the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of
the Indenture. See "--Repurchase at the Option of Holders--Asset
Sales." In addition, the Indenture provides that, in the event the
Board of Directors designates a Guarantor to be an Unrestricted
Subsidiary, then such Guarantor will be released and relieved of any
obligations under its Subsidiary Guarantee, provided that such
designation is conducted in accordance with the applicable provisions of
the Indenture.
Optional Redemption
The Notes will not be redeemable at the Company's option prior to
August 1, 2001. Thereafter, the Notes will be subject to redemption at
any time at the option of the Company, in whole or in part, at the
redemption prices (expressed as percentages of principal amount) set
forth below, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on August 1 of the years indicated below:
Year Percentage
2001.......................................104.250%
2002.......................................102.834%
2003.......................................101.417%
2004 and thereafter........................100.000%
Notwithstanding the foregoing, the Company may at any time prior
to August 1, 2001, at its option, redeem the Notes, in whole or in part,
at the Make-Whole Price, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the redemption date. In addition, on or
prior to July 17, 2000, the Company may redeem up to 35% of the
aggregate principal amount of Notes originally issued at a redemption
price of 108.5 % of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the
redemption date, with the net cash proceeds of one or more Qualified
Equity Offerings, provided that (a) at least $71.5 million in aggregate
principal amount of Notes remains outstanding immediately after the
occurrence of each such redemption and (b) each such redemption occurs
within 60 days of the date of the closing of each such Qualified Equity
Offering.
Selection and Notice
If less than all of the Notes are to be redeemed at any time,
selection of Notes for redemption will be made by the Trustee on a pro
rata basis, by lot or by such method as the Trustee shall deem fair and
appropriate; provided, however, that no Notes of $1,000 or less shall be
redeemed in part. Notices of redemption shall be mailed by first class
mail at least 30 but not more than 60 days before the redemption date to
each holder of Notes to be redeemed at its registered address. Notices
of redemption may not be conditional. If any Note is to be redeemed in
part only, the notice of redemption that relates to such Note shall
state the portion of the principal amount thereof to be redeemed. A new
Note in principal amount equal to the unredeemed portion thereof will be
issued in the name of the holder thereof upon cancellation of the
original Note. Notes called for redemption become due on the date fixed
for redemption. On and after the redemption date, interest ceases to
accrue on Notes or portions of them called for redemption.
Mandatory Redemption
Except as set forth below under "--Repurchase at the Option of
Holders," the Company is not required to make mandatory redemption or
sinking fund payments with respect to the Notes.
Repurchase at the Option of Holders
Change of Control
The Indenture provides that, upon the occurrence of a Change of
Control, the Company will be required to make an offer (a "Change of
Control Offer") to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each holder's Notes at an offer price in
cash equal to 101% of the aggregate principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to
the date of repurchase (the "Change of Control Payment"). Within 30
days following a Change of Control, the Company will mail a notice to
each holder of Notes and the Trustee describing the transaction that
constitutes the Change of Control and offering to repurchase Notes on
the date specified in such notice, which date shall be no earlier than
30 days and no later than 60 days from the date such notice is mailed
(the "Change of Control Payment Date"), pursuant to the procedures
required by the Indenture and described in such notice. The Company
will comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent
such laws and regulations are applicable in connection with the
repurchase of Notes as a result of a Change of Control.
On or before the Change of Control Payment Date, the Company will,
to the extent lawful, (a) accept for payment all Notes or portions
thereof properly tendered pursuant to the Change of Control Offer, (b)
deposit with the Paying Agent an amount equal to the Change of Control
Payment in respect of all Notes or portions thereof so tendered and (c)
deliver or cause to be delivered to the Trustee the Notes so accepted
together with an Officers' Certificate stating the aggregate principal
amount of Notes or portions thereof being purchased by the Company. The
Paying Agent will promptly mail to each holder of Notes so tendered the
Change of Control Payment for such Notes, and the Trustee will promptly
authenticate and mail (or cause to be transferred by book entry) to each
holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; provided, however, that each such new
Note will be in a principal amount of $1,000 or an integral multiple
thereof. The Company will publicly announce the results of the Change
of Control Offer on or as soon as practicable after the Change of
Control Payment Date.
Except as described above with respect to a Change of Control, the
Indenture does not contain provisions that permit the holders of the
Notes to require that the Company repurchase or redeem the Notes in the
event of a takeover, recapitalization or similar transaction. In
addition, the Company could enter into certain transactions, including
acquisitions, refinancing or other recapitalizations, that could affect
the Company's capital structure or the value of the Notes, but that
would not constitute a Change of Control. The occurrence of a Change of
Control may result in a default under the Credit Facility and give the
lenders thereunder the right to require the Company to repay all
outstanding obligations thereunder. The Company's ability to repurchase
Notes following a Change of Control may also be limited by the Company's
then existing financial resources.
The Company will not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in the Indenture applicable to a Change of
Control Offer made by the Company and purchases all Notes validly
tendered and not withdrawn under such Change of Control Offer.
A "Change of Control" will be deemed to have occurred upon the
occurrence of any of the following: (a) the sale, lease, transfer,
conveyance or other disposition (other than by merger or consolidation),
in one or a series of related transactions, of all or substantially all
of the assets of the Company and its Subsidiaries, taken as a whole, (b)
the adoption of a plan relating to the liquidation or dissolution of the
Company, (c) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as such term is used in Section 13(d)(3) of the Exchange Act)
becomes the "beneficial owner" (as such term is defined in Rule 13d-3
and Rule 13d-5 under the Exchange Act), directly or indirectly through
one or more intermediaries, of more than 50% of the voting power of the
outstanding voting stock of the Company or (d) the first day on which
more than a majority of the members of the Board of Directors are not
Continuing Directors; provided, however, that a transaction in which the
Company becomes a Subsidiary of another Person (other than a Person that
is an individual) shall not constitute a Change of Control if (i) the
stockholders of the Company immediately prior to such transaction
"beneficially own" (as such term is defined in Rule 13d-3 and Rule 13d-5
under the Exchange Act), directly or indirectly through one or more
intermediaries, at least a majority of the voting power of the
outstanding voting stock of the Company immediately following the
consummation of such transaction and (ii) immediately following the
consummation of such transaction, no "person" (as such term is defined
above), other than such other Person (but including the holders of the
Equity Interests of such other Person), "beneficially owns" (as such
term is defined above), directly or indirectly through one or more
intermediaries, more than 50% of the voting power of the outstanding
voting stock of the Company. For purposes of this definition, a time
charter of vessels to customers in the ordinary course of business shall
not be deemed to be a "lease" under clause (a) above.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors who (a) was a member of the Board of
Directors on the date of original issuance of the Notes or (b) was
nominated for election to the Board of Directors with the approval of,
or whose election to the Board of Directors was ratified by, at least
two-thirds of the Continuing Directors who were members of the Board of
Directors at the time of such nomination or election.
Asset Sales
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, consummate an Asset Sale
unless (a) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at the time of such Asset Sale at least equal
to the fair market value (as determined in accordance with the
definition of such term, the results of which determination shall be set
forth in an Officer's Certificate delivered to the Trustee) of the
assets or Equity Interests issued or sold or otherwise disposed of and
(b) at least 75% of the consideration therefor received by the Company
or such Restricted Subsidiary is in the form of cash or Cash
Equivalents; provided, however, that the amount of (i) any liabilities
(as shown on the Company's or such Restricted Subsidiary's most recent
balance sheet) of the Company or such Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms
subordinated to the Notes or any guarantee thereof) that are assumed by
the transferee of any such assets pursuant to a customary novation
agreement that releases the Company or such Restricted Subsidiary from
further liability and (ii) any securities, notes or other obligations
received by the Company or such Restricted Subsidiary from such
transferee that are immediately converted by the Company or such
Restricted Subsidiary into cash (to the extent of the cash received)
shall be deemed to be cash for purposes of this provision.
Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, the Company or any such Restricted Subsidiary may apply such
Net Proceeds to (a) permanently repay the principal of any secured
Indebtedness (to the extent of the fair value of the assets securing
such Indebtedness, as determined by the Board of Directors) or (b) to
acquire (including by way of a purchase of assets or stock, merger,
consolidation or otherwise) Productive Assets. (Any such Net Proceeds
that are applied to the acquisition of Productive Assets pursuant to any
binding agreement to construct any new marine vessel useful in the
business of the Company or any of its Restricted Subsidiaries shall be
deemed to have been applied for such purpose within such 365-day period
so long as they are so applied within 18 months of the effective date of
such agreement but no later than two years after the date of receipt of
such Net Proceeds.) Pending the final application of any such Net
Proceeds, the Company or any such Restricted Subsidiary may temporarily
reduce outstanding revolving credit borrowings, including borrowings
under the Credit Facility, or otherwise invest such Net Proceeds in any
manner that is not prohibited by the Indenture. Any Net Proceeds from
Asset Sales that are not applied or invested as provided in the first
sentence of this paragraph will be deemed to constitute "Excess
Proceeds."
When the aggregate amount of Excess Proceeds exceeds $5.0 million,
the Company will be required to make an offer to all holders of Notes
(an "Asset Sale Offer") to purchase the maximum principal amount of
Notes that may be purchased out of the Excess Proceeds at an offer price
in cash in an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to
the date of purchase, in accordance with the procedures set forth in the
Indenture; provided, however, that, if the Company is required to apply
such Excess Proceeds to repurchase, or to offer to repurchase, any Pari
Passu Indebtedness, the Company shall only be required to offer to
repurchase the maximum principal amount of Notes that may be purchased
out of the amount of such Excess Proceeds multiplied by a fraction, the
numerator of which is the aggregate principal amount of Notes
outstanding and the denominator of which is the aggregate principal
amount of Notes outstanding plus the aggregate principal amount of Pari
Passu Indebtedness outstanding. To the extent that the aggregate
principal amount of Notes tendered pursuant to an Asset Sale Offer is
less than the amount that the Company is required to repurchase, the
Company may use any remaining Excess Proceeds for general corporate
purposes. If the aggregate principal amount of Notes surrendered by
holders thereof exceeds the amount that the Company is required to
repurchase, the Trustee shall select the Notes to be purchased on a pro
rata basis. Upon completion of such offer to purchase, the amount of
Excess Proceeds shall be reset at zero.
Certain Covenants
Restricted Payments
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly,
(a) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any such
payment in connection with any merger or consolidation with any merger
or consolidation involving the Company) or to the direct or indirect
holders of the Company's Equity Interests in their capacity as such
(other than dividends or distributions payable in Equity Interests
(other than Disqualified Stock) of the Company); (b) purchase, redeem or
otherwise acquire or retire for value (including without limitation, in
connection with any merger or consolidation involving the Company) any
Equity Interests of the Company (other than any such Equity Interests
owned by the Company or any Wholly Owned Restricted Subsidiary of the
Company); (c) make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value, any
Indebtedness that is subordinated to the Notes, except a payment of
interest or principal at Stated Maturity; or (d) make any Restricted
Investment (all such payments and other actions set forth in clauses (a)
through (d) above being collectively referred to as "Restricted
Payments"), unless, at the time of and after giving effect to such
Restricted Payment:
(i) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(ii) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period,
have been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Consolidated Interest Coverage Ratio test set forth in
the first paragraph of the covenant described below under the caption "-
- -Incurrence of Indebtedness and Issuance of Preferred Stock;" and
(iii) such Restricted Payment, together with the aggregate of all
other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date of the Indenture (excluding Restricted
Payments permitted by clauses (b), (c),(d) and (f), but including,
without duplication, Restricted Payments permitted by clauses (a) and
(e), of the next succeeding paragraph), is less than the sum of (A) 50%
of the Consolidated Net Income of the Company for the period (taken as
one accounting period) from July 1, 1997 to the end of the Company's
most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if
such Consolidated Net Income for such period is a deficit, less 100% of
such deficit), plus (B) 100% of the aggregate net cash proceeds received
by the Company from the issue or sale since the date of the Indenture of
Equity Interests of the Company (other than Disqualified Stock) or of
Disqualified Stock or debt securities of the Company that have been
converted into such Equity Interests (other than any such Equity
Interests or Disqualified Stock or convertible debt securities that have
been converted into Disqualified Stock), plus (C) to the extent that any
Restricted Investment that was made after the date of the Indenture is
sold for cash or otherwise liquidated or repaid for cash, the lesser of
(1) the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any) and (2) the initial
amount of such Restricted Investment, plus (D) in the event that any
Unrestricted Subsidiary is redesignated as a Restricted Subsidiary, the
lesser of (1) an amount equal to the fair market value of the Company's
Investments in such Restricted Subsidiary and (2) the amount of
Restricted Investments previously made by the Company and its Restricted
Subsidiaries in such Unrestricted Subsidiary, plus (E) $5.0 million.
The foregoing provisions will not prohibit any of the following
(a) the payment of any dividend within 60 days after the date of
declaration thereof if at said date of declaration such payment would
have complied with the provisions of the Indenture; (b) the redemption,
repurchase, retirement, defeasance or other acquisition of any
subordinated Indebtedness or Equity Interests of the Company in exchange
for, or out of the net cash proceeds of the substantially concurrent
sale (other than to a Subsidiary of the Company) of, other Equity
Interests of the Company (other than any Disqualified Stock), provided
that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement, defeasance or other acquisition
shall be excluded from clause (iii)(B) of the preceding paragraph; (c)
the defeasance, redemption, repurchase, retirement or other acquisition
of subordinated Indebtedness with the net cash proceeds from an
incurrence of, or in exchange for, Permitted Refinancing Indebtedness;
(d) the payment of any dividend or distribution by a Restricted
Subsidiary of the Company to the Company or any of its Wholly Owned
Restricted Subsidiaries; (e) so long as no Default or Event of Default
shall have occurred and be continuing, the repurchase, redemption or
other acquisition or retirement for value of any Equity Interests of the
Company held by any employee of the Company's or any of its Restricted
Subsidiaries, provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not
exceed $500,000 in any calendar year; and (f) the acquisition of Equity
Interests by the Company in connection with the exercise of stock
options or stock appreciation rights by way of cashless exercise or in
connection with the satisfaction of withholding tax obligations.
The Board of Directors may designate any Restricted Subsidiary to
be an Unrestricted Subsidiary if such designation would not cause a
Default. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to
the extent repaid in cash) in the Subsidiary so designated will be
deemed to be Restricted Payments at the time of such designation. All
such outstanding Investments will be deemed to constitute Investments in
an amount equal to the greater of (a) the net book value of such
Investments at the time of such designation and (b) the fair market
value of such Investments at the time of such designation. Such
designation will only be permitted if such Restricted Payment would be
permitted at such time and if such Restricted Subsidiary otherwise meets
the definition of an Unrestricted Subsidiary.
The amount of all Restricted Payments (other than cash) shall be
the fair market value on the date of the Restricted Payment of the
asset(s) or securities proposed to be transferred or issued by the
Company or such Restricted Subsidiary, as the case may be, pursuant to
the Restricted Payment. The fair market value of any non-cash
Restricted Payment shall be determined in the manner contemplated by the
definition of the term "fair market value," and the results of such
determination shall be evidenced by an Officers' Certificate delivered
to the Trustee. Not later than the date of making any Restricted
Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by the
covenant "Restricted Payments" were computed.
Incurrence of Indebtedness and Issuance of Preferred Stock
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly,
create, incur, issue, assume, guarantee or otherwise become directly or
indirectly liable, contingently or otherwise, with respect to
(collectively, "incur" or an "incurrence") any Indebtedness and that the
Company will not issue any Disqualified Stock and will not permit any of
its Restricted Subsidiaries to issue any shares of preferred stock;
provided, however, that the Company and its Restricted Subsidiaries may
incur Indebtedness, and the Company may issue Disqualified Stock, if the
Consolidated Interest Coverage Ration for the Company's most recently
ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified Stock is issued would have
been at least 2.25 to 1, determined on a pro forma basis (including a
pro forma application of the net proceeds therefrom), as if the
additional Indebtedness or Disqualified Stock had been issued or
incurred at the beginning of such four-quarter period.
The foregoing provisions will not apply to:
(a) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness under the Credit Facility in an
aggregate principal amount at any one time outstanding not to
exceed $65.0 million, plus any fees, premiums, expenses (including
costs of collection), indemnities and similar amounts payable in
connection with such Indebtedness, and less any amounts repaid
permanently in accordance with the covenant described under the
caption "--Repurchase at the Option of Holders--Asset Sales";
(b) the incurrence by the Company and its Restricted
Subsidiaries of Existing Indebtedness;
(c) the incurrence by the Company and its Restricted
Subsidiaries of Hedging Obligations;
(d) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness represented by the Notes, the
Subsidiary Guarantees and the Indenture;
(e) the incurrence of intercompany Indebtedness between or
among the Company and any of its Wholly Owned Restricted
Subsidiaries, provided that any subsequent issuance or transfer of
Equity Interests that results in any such Indebtedness being held
by a Person other than the Company or a Wholly Owned Restricted
Subsidiary of the Company, or any sale or other transfer of any
such Indebtedness to a Person that is neither the Company nor a
Wholly Owned Restricted Subsidiary of the Company, shall be deemed
to constitute an incurrence of such Indebtedness by the Company or
such Restricted Subsidiary, as the case may be;
(f) Indebtedness in respect of bid, performance or surety
bonds issued for the account of the Company or any Restricted
Subsidiary thereof in the ordinary course of business, including
guarantees or obligations of the Company or any Restricted
Subsidiary thereof with respect to letters of credit supporting
such bid, performance or surety obligations (in each case other
than for an obligation for money borrowed); and
(g) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Debt in exchange for, or the
net proceeds of which are used to extend, refinance, renew,
replace, defease or refund Indebtedness that was permitted by the
Indenture to be incurred (other than pursuant to clause (a) or (e)
of this covenant).
In the event that the incurrence of any Indebtedness would be
permitted by the first paragraph set forth above or one or more of the
provisions set forth in the second paragraph above, the Company may
designate (in the form of an Officers' Certificate delivered to the
Trustee) the particular provision of the Indenture pursuant to which it
is incurring such Indebtedness.
Liens
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly,
create, incur, assume or suffer to exist any Lien on any asset now owned
or hereafter acquired, or any income or profits therefrom or assign or
convey any right to receive income therefrom, except Permitted Liens, to
secure (a) any Indebtedness of the Company or such Restricted Subsidiary
(if it is not also a Guarantor), unless prior to, or contemporaneously
therewith, the Notes are equally and ratably secured, or (b) any
Indebtedness of any Guarantor, unless prior to, or contemporaneously
therewith, the Subsidiary Guarantees are equally and ratably secured;
provided, however, that if such Indebtedness is expressly subordinated
to the Notes or the Subsidiary Guarantees, the Lien securing such
Indebtedness will be subordinated and junior to the Lien securing the
Notes or the Subsidiary Guarantees, as the case may be, with the same
relative priority as such Indebtedness has with respect to the Notes or
the Subsidiary Guarantees.
Sale-and-Leaseback Transactions
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, enter into any sale-and-
leaseback transactions; provided, however, that the Company or any
Restricted Subsidiary, as applicable, may enter into a sale-and-
leaseback transaction if (i) the Company or such Restricted Subsidiary
could have (a) incurred Indebtedness in an amount equal to the
Attributable Indebtedness relating to such sale-and-leaseback
transaction pursuant to the Consolidated Interest Coverage Ratio test
set forth in the first paragraph of the covenant described above under
the caption "--Incurrence of Indebtedness and Issuance of Preferred
Stock" and (b) incurred a Lien to secure such Indebtedness pursuant to
the covenant described under the caption "--Liens," (ii) the gross cash
proceeds of such sale-and-leaseback transaction are at least equal to
the fair market value (as determined in accordance with the definition
of such term, the results of which determination shall be set forth in
an Officers' Certificate delivered to the Trustee) of the property that
is the subject of such sale-and-leaseback transaction and (iii) the
transfer of assets in such sale-and-leaseback transaction is permitted
by, and the Company applies the proceeds of such transaction in
compliance with, the covenant described above under the caption "--
Repurchase at the Option of Holders--Asset Sales."
Issuances and Sales of Capital Stock of Wholly Owned Restricted
Subsidiaries
The Indenture provides that the Company (i) will not, and will not
permit any Wholly Owned Restricted Subsidiary of the Company to,
transfer, convey, sell or otherwise dispose of any Capital Stock of any
Wholly Owned Restricted Subsidiary of the Company to any Person (other
than the Company or a Wholly Owned Restricted Subsidiary of the
Company), unless (a) such transfer, conveyance, sale, or other
disposition is of all the Capital Stock of such Wholly Owned Restricted
Subsidiary and (b) the Net Proceeds from such transfer, conveyance,
sale, or other disposition are applied in accordance with the covenant
described above under the caption "--Repurchase At Option Of Holders--
Asset Sales," and (ii) will not permit any Wholly Owned Restricted
Subsidiary of the Company to issue any of its Equity Interests to any
Person other than to the Company or a Wholly Owned Restricted Subsidiary
of the Company; except, in the case of both clauses (i) and (ii) above,
with respect to (1) dispositions or issuances by a Wholly Owned
Restricted Subsidiary of the Company as contemplated in clauses (a) and
(b) of the definition of "Wholly Owned Restricted Subsidiary" or (2)
other dispositions or issuances of up to 35% of the outstanding Capital
Stock of a Wholly Owned Restricted Subsidiary of the Company, provided
that, after giving pro forma effect thereto, the Investment of the
Company and its Wholly Owned Restricted Subsidiaries in all Restricted
Subsidiaries that are not Wholly Owned Restricted Subsidiaries of the
Company, determined on a consolidated basis in accordance with GAAP,
does not exceed 15% of Consolidated Net Tangible Assets of the Company.
Dividend and Other Payment Restrictions Affecting Subsidiaries
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted Subsidiary
to (a)(i) pay dividends or make any other distributions to the Company
or any of its Restricted Subsidiaries on its Capital Stock or with
respect to any other interest or participation in, or measured by, its
profits, or (ii) pay any Indebtedness owed to the Company or any of its
Restricted Subsidiaries, (b) make loans or advances to the Company or
any of its Restricted Subsidiaries or (c) transfer any of its properties
or assets to the Company or any of its Restricted Subsidiaries, except
for such encumbrances or restrictions existing under or by reason of (1)
the Credit Facility or Existing Indebtedness, each as in effect on the
date of the Indenture, (2) the Indenture and the Notes, (3) applicable
law, (4) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries as
in effect at the time of such acquisition (except to the extent such
Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any
Person or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired, provided that, in
the case of Indebtedness, such Indebtedness was permitted by the terms
of the Indenture to be incurred, (5) by reason of customary non-
assignment provisions in leases entered into in the ordinary course of
business and consistent with past practices, (6) purchase money
obligations for property acquired in the ordinary course of business
that impose restrictions of the nature described in clause (c) above on
the property so acquired, (7) customary provisions in bona fide
contracts for the sale of property or assets or (8) Permitted
Refinancing Indebtedness with respect to any Indebtedness referred to in
clauses (1) and (2) above, provided that the restrictions contained in
the agreements governing such Permitted Refinancing Indebtedness are not
materially more restrictive, taken as a whole, than those contained in
the agreements governing the Indebtedness being refinanced.
Merger, Consolidation, or Sale of Assets
The Indenture provides that the Company may not consolidate or
merge with or into (whether or not the Company is the surviving
corporation), or sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all of its properties or assets in one
or more related transactions, to another Person unless (a) the Company
is the surviving corporation or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to which
such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation organized or existing under the
laws of the United States, any state thereof or the District of
Columbia, (b) the Person formed by or surviving any such consolidation
or merger (if other than the Company) or the Person to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made assumes all the obligations of the Company under the Notes and
the Indenture pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee, (c) immediately after such transaction no
Default or Event of Default exists and (d) except in the case of a
merger of the Company with or into a Wholly Owned Subsidiary of the
Company, the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such
sale, assignment, transfer, lease, conveyance or other disposition shall
have been made (A) will have Consolidated Net Worth immediately after
the transaction equal to or greater than the Consolidated Net Worth of
the Company immediately preceding the transaction and (B) will, at the
time of such transaction and after giving pro forma effect thereto as if
such transaction had occurred at the beginning of the applicable four-
quarter period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Consolidated Interest Coverage Ratio test
set forth in the first paragraph of the covenant described above under
the caption "--Incurrence of Indebtedness and Issuance of Preferred
Stock."
Transaction with Affiliates
The Indenture provides that the Company will not, and will not
permit any of its Restricted Subsidiaries to, make any payment to, or
sell, lease, transfer or otherwise dispose of any of its properties or
assets to, or purchase any property or assets from, or enter into or
make or amend any transaction, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate (each of
the foregoing, an "Affiliate Transaction"), unless (a) such Affiliate
Transaction is on terms that are no less favorable to the Company or the
relevant Restricted Subsidiary than those that would have been obtained
in a comparable transaction by the Company or such Restricted Subsidiary
with an unrelated Person or, if there is no such comparable transaction,
on terms that are fair and reasonable to the Company or such Restricted
Subsidiary, and (b) the Company delivers to the Trustee (i) with respect
to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $1.0 million, a
resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction complies with
clause (a) above and that such Affiliate Transaction has been approved
by a majority of the disinterested members of the Board of Directors and
(ii) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$5.0 million, other than any such transactions with a joint venture
engaged in the business of providing marine support vessels and related
services to the oil and gas industry (or a business that is reasonably
complementary or related thereto as determined in good faith by the
Board of Directors), an opinion as to the fairness to the Company or the
relevant Subsidiary of such Affiliate Transaction from a financial point
of view issued by an accounting, appraisal or investment banking firm
that is, in the judgment of the Board of Directors, qualified to render
such opinion and is independent with respect to the Company; provided,
however, that the following shall be deemed not to be Affiliate
Transactions: (A) any employment agreement or other employee
compensation plan or arrangement entered into by the Company or any of
its Restricted Subsidiaries in the ordinary course of business of the
Company or such Restricted Subsidiary; (B) transactions between or among
the Company and its Restricted Subsidiaries; (C) Permitted Investments
and Restricted Payments that are permitted by the provisions of the
Indenture; (D) loans or advances to officers, directors and employees of
the Company or any Restricted Subsidiary made in the ordinary course of
business and consistent with past practices of the Company and its
Restricted Subsidiaries in an aggregate amount not to exceed $500,000
outstanding at any one time; (E) indemnities of officers, directors and
employees of the Company or any Restricted Subsidiary permitted by bylaw
or statutory provisions; and (F) the payment of reasonable and customary
regular fees to directors of the Company or any of its Restricted
Subsidiaries who are not employees of the Company or any Affiliate.
Additional Subsidiary Guarantees
The Indenture provides that (a) if the Company or any of its
Restricted Subsidiaries shall, after the date of the Indenture, acquire
or create another Significant Subsidiary, or (b) if, after such date, a
Restricted Subsidiary shall provide a guarantee under the Credit
Facility or incur any Funded Indebtedness, then such newly acquired or
created Significant Subsidiary or such Subsidiary described in clause
(b) above, as the case may be, shall execute a Subsidiary Guarantee and
deliver an opinion of counsel in accordance with the terms of the
Indenture.
Reports
Whether or not the Company is required to do so by the rules and
regulations of the Commission, the Company will file with the Commission
(unless the Commission will not accept such a filing) and, within 15
days of filing, or attempting to file, the same with the Commission,
furnish to the holders of the Notes (a) all quarterly and annual
financial and other information with respect to the Company and its
Subsidiaries that would be required to be contained in a filing with the
Commission on Forms 10-Q and 10-K if the Company were required to file
such forms, including a "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and, with respect to the
annual information only, a report thereon by the Company's certified
independent accountants, and (b) all current reports that would be
required to be filed with the Commission of Form 8-K if the Company were
required to file such reports. In addition, the Company and the
Guarantors will furnish to the holders of the Notes, prospective
purchasers of the Notes and securities analysts, upon their request, the
information, if any, required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
Events of Default and Remedies
The Indenture provides that each of the following constitutes an
Event of Default: (a) default for 30 days in the payment when due of
interest or Liquidated Damages on the Notes; (b) default in payment when
due of the principal of or premium, if any, on the Notes; (c) failure by
the Company to comply with the provisions described under the caption "-
- -Repurchase at the Option of Holders" or "--Certain Covenants--Merger,
Consolidation, or Sale of Assets"; (d) failure by the Company for 60
days after notice to comply with any of its other agreements in the
Indenture or the Notes; (e) default under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company
or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Restricted Subsidiaries) whether
such Indebtedness or guarantee now exists or is created after the date
of the Indenture, which default (i) is caused by a failure to pay
principal of or premium or interest on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness (a "Payment
Default") or (ii) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any
such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $5.0 million or
more and provided, further, that if any such default is cured or waived
or any such acceleration rescinded, or such Indebtedness is repaid,
within a period of 10 days from the continuation of such default beyond
the applicable grade period or the occurrence of such acceleration, as
the case may be, such Event of Default and any consequential
acceleration of the Notes shall be automatically rescinded, so long as
such rescission does not conflict with any judgment or decree;
(f) failure by the Company or any of its Restricted Subsidiaries to pay
final judgments aggregating in excess of $5.0 million, which judgments
are not paid, discharged or stayed for a period of 60 days; (g) failure
by any Guarantor to perform any covenant set forth in its Subsidiary
Guarantee, or the repudiation by any Guarantor of its obligations under
its Subsidiary Guarantee or the unenforceability of any Subsidiary
Guarantee against a Guarantor for any reason and (h) certain events of
bankruptcy or insolvency with respect to the Company or any Guarantor.
If any Event of Default occurs and is continuing, the Trustee or
the holders of at least 25% in principal amount of the then outstanding
Notes may declare all the Notes to be due and payable immediately.
Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency with respect to
the Company any Guarantor, all outstanding Notes will become due and
payable without further action or notice. The holders of a majority in
principal amount of the then outstanding Notes by written notice to the
Trustee may on behalf of all of the holders rescind an acceleration and
its consequences if the rescission would not conflict with any judgment
or decree and if all existing Events of Default (except nonpayment of
principal, interest, premium or Liquidated Damages that have become due
solely because of the acceleration) have been cured or waived. Holders
of the Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, holders of a
majority in principal amount of the then outstanding Notes may direct
the Trustee in its exercise of any trust or power. The Trustee may
withhold from holders of the Notes notice of any continuing Default or
Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines that withholding
notice is in their interest.
In the case of any Event of Default occurring by reason of any
willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the
Company would have had to pay if the Company then had elected to redeem
the Notes pursuant to the optional redemption provisions of the
Indenture, an equivalent premium shall also become and be immediately
due and payable to the extent permitted by law upon the acceleration of
the Notes.
The holders of a majority in principal amount of the Notes then
outstanding by notice to the Trustee may on behalf of the holders of all
of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of
Default in the payment of the principal of or interest or Liquidated
Damages on the Notes.
The Company will be required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Company will
be required, upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of
Default.
No Personal Liability of Directors, Officers, Employees and Stockholders
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, shall have any liability for any
obligations of the Company or any Guarantor under the Notes, the
Subsidiary Guarantees or the Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each
holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive
liabilities under the federal securities laws and it is the view of the
Commission that such a waiver is against public policy.
Legal Defeasance and Covenant Defeasance
The Company may, at its option and at any time, elect to have all
of the obligations of itself and the Guarantors discharged with respect
to the outstanding Notes ("Legal Defeasance") except for (a) the rights
of holders of outstanding Notes to receive payments in respect of the
principal of and premium, interest and Liquidated Damages on such Notes
when such payments are due from the trust referred to below, (b) the
Company's obligations with respect to the Notes concerning issuing
temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the maintenance of an office or agency for payment and
money for security payments held in trust, (c) the rights, powers,
trusts, duties and immunities of the Trustee, and the Company's
obligations in connection therewith and (d) the Legal Defeasance
provisions of the Indenture. In addition, the Company may, at its
option and at any time, elect to have the obligations of the Company
released with respect to certain covenants that are described in the
Indenture ("Covenant Defeasance") and thereafter any omission to comply
with such obligations shall not constitute a Default or Event of Default
with respect to the Notes. In the event Covenant Defeasance occurs,
certain event (not including non-payment, bankruptcy, receivership,
rehabilitation and insolvency events) described under "Events of Default
and Remedies" will no longer constitute an Event of Default with respect
to the Notes.
In order to exercise either Legal Defeasance or Covenant
Defeasance, (i) the Company must irrevocably deposit with the Trustee,
in trust, for the benefit of the holders of the Notes, cash in U.S.
dollars, non-callable Government Securities, or a combination thereof,
in such amounts as will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay the principal
of and premium, interest and Liquidated Damages, if any, on the
outstanding Notes on the stated maturity or on the applicable redemption
date, as the case may be, and the Company must specify whether the Notes
are being defeased to maturity or to a particular redemption date, (ii)
in the case of Legal Defeasance, the Company shall have delivered to the
Trustee an opinion of counsel in the United States reasonably acceptable
to the Trustee confirming that (A) the Company has received from, or
there has been published by, the Internal Revenue Service a ruling or
(B) since the date of the Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that,
and based thereon such opinion of counsel shall confirm that, the
holders of the outstanding Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such Legal Defeasance and
will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Legal
Defeasance had not occurred, (iii) in the case of Covenant Defeasance,
the Company shall have delivered to the Trustee an opinion of counsel in
the United States reasonably acceptable to the Trustee confirming that
the holders of the outstanding Notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such Covenant Defeasance had not occurred, (iv) no Default or
Event of Default shall have occurred and be continuing on the date of
such deposit (other than a Default or Event of Default resulting from
the borrowing of funds to be applied to such deposit), (v) such Legal
Defeasance or Covenant Defeasance will not result in a breach or
violation of, or constitute a default under any material agreement or
instrument (other than the Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound, (vi) the Company must have delivered
to the Trustee an opinion of counsel to the effect that the trust funds
will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally, (vii) the Company must deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of preferring the holders of Notes over the other creditors
of the Company with the intent of defeating, hindering, delaying or
defrauding creditors of the Company or others and (viii) the Company
must deliver to the Trustee an Officers' Certificate and an opinion of
counsel, each stating that all conditions precedent provided for
relating to the Legal Defeasance or the Covenant Defeasance have been
complied with.
Transfer and Exchange
A holder of Notes may transfer or exchange Notes in accordance
with the Indenture. The Registrar and the Trustee may require a holder,
among other things, to furnish appropriate endorsements and transfer
documents and the Company may require a holder to pay any taxes and fees
required by law or permitted by the Indenture. The Company will not be
required to transfer or exchange any Note selected for redemption.
Also, the Company will not be required to transfer or exchange any Note
for a period of 15 days before a selection of Notes to be redeemed.
The registered holder of a Note will be treated as the owner of it
for all purposes, and all references to "holders" in this "Description
of the Notes" are to registered holders unless otherwise indicated.
Amendment and Waiver
Except as provided below, the Indenture or the Notes may be
amended with the consent of the holders of at least a majority in
principal amount of the Notes then outstanding (including, without
limitation, consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes), and any existing default or
compliance with any provision of the Indenture or the Notes may be
waived with the consent of the holders of a majority in principal amount
of the then outstanding Notes (including consents obtained in connection
with a tender offer or exchange offer for Notes).
Without the consent of each holder affected, an amendment or
waiver may not (with respect to any Notes held by a non-consenting
Holder): (a) reduce the principal amount of Notes whose holders must
consent to an amendment or waiver, (b) reduce the principal of or change
the fixed maturity of any Note or alter the provisions with respect to
the redemption of the Notes (other than provisions relating to the
covenants described above under the caption "--Repurchase at the Option
of Holders"), (c) reduce the rate of or change the time for payment of
interest on any Note, (d) waive a Default or Event of Default in the
payment of principal of or premium, interest or Liquidated Damages on
the Notes (except a rescission of acceleration of the Notes by the
holders of at least a majority in principal amount of the Notes and a
waiver of the payment default that resulted from such acceleration), (e)
make any Note payable in money other than that stated in the Notes, (f)
make any change in the provisions of the Indenture relating to waivers
of past defaults or the rights of holders of Notes to receive payments
of principal of or premium, interest or Liquidated Damages on the Notes
(except as permitted in clause (g) hereof), (g) waive a redemption
payment with respect to any Note (other than a payment required by one
of the covenants described above under the caption "--Repurchase at the
Option of Holders"), (h) alter the ranking of the Notes relative to
other Indebtedness of the Company or (i) make any change in the
foregoing amendment and waiver provisions.
Notwithstanding the foregoing, without the consent of any holder
of Notes, the Company, the Guarantors and the Trustee may amend or
supplement the Indenture or the Notes to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in
place of certificated Notes, to provide for the assumption of the
Company's obligations to holders of Notes in the case of a merger or
consolidation, to make any change that would provide any additional
rights or benefits to the holders of Notes or that does not adversely
affect the legal rights under the Indenture of any such holder, to
secure the Notes pursuant to the requirements of the "Liens" covenant,
to add any additional Guarantor or to release any Guarantor from its
Subsidiary Guarantee, in each case as provided in the Indenture, or to
comply with requirements of the Commission in order to effect or
maintain the qualification of the Indenture under the Trust Indenture
Act.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any holder of any Notes for or as an
inducement to any consent, waiver or amendment of any terms or
provisions of the Indenture or the Notes, unless such consideration is
offered to be paid or agreed to be paid to all holders of the Notes
which so consent, waive or agree to amend in the time frame set forth in
solicitation documents relating to such consent, waiver or agreement.
Concerning the Trustee
The Indenture contains certain limitations on the rights of the
Trustee, should it become a creditor of the Company, to obtain payment
of claims in certain cases, or to realize on certain property received
in respect of any such claim as security or otherwise. The Trustee will
be permitted to engage in other transactions; however, if it acquires
any conflicting interest it must eliminate such conflict within 90 days,
apply to the Commission for permission to continue or resign.
The holders of a majority in principal amount of the then
outstanding Notes will have the right to direct the time, method and
place of conducting any proceeding for exercising any remedy available
to the Trustee, subject to certain exceptions. The Indenture provides
that in case an Event of Default shall occur (which shall not be cured),
the Trustee will be required, in the exercise of its owner, to use the
degree of care of a prudent man in the conduct of his own affairs.
Subject to such provisions, the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request
of any holder of Notes, unless such holder shall have offered to the
Trustee security and indemnity satisfactory to it against any loss,
liability or expense.
Governing Law
The Indenture, the Notes and the Subsidiary Guarantees provide
that they are governed by the laws of the State of New York.
Additional Information
Anyone who receives this Prospectus may obtain a copy of the
Indenture and Registration Rights Agreement without charge by writing to
Trico Marine Services, Inc., 2401 Fountainview, Suite 626, Houston,
Texas 77057, Attention: Corporate Secretary.
Form, Denomination and Registration
Global Notes; Book Entry Form
Except as set forth in the next paragraph, the Notes will be
evidenced initially by one or more global notes (the "Global Note")
which will be deposited with, or on behalf of, DTC and registered in the
name of Cede & Co., as DTC's nominee. Except as set forth below, record
ownership of the Global Note may be transferred, in whole or in part,
only to another nominee of DTC or to a successor of DTC or its nominee.
Notes (i) originally purchased by or transferred to "foreign
purchasers" or Institutional Accredited Investors who are not Qualified
Institutional Buyers or (ii) held by Qualified Institutional Buyers who
elect to take physical delivery of their certificates instead of holding
their interests through the Global Note (and which are thus ineligible
to trade through DTC) (collectively referred to herein as the "Non-
Global Purchasers") will be issued in registered certificated form
("Certificated Notes"). Upon the transfer to a Qualified Institutional
Buyer of any Certificated Note initially issued to a Non-Global
Purchaser, such Certificated Note will, unless the transferee requests
otherwise or the Global Note has previously been exchanged in whole for
Certificated Notes as described below, be exchanged for an interest in
the Global Note.
Owners of beneficial interests in the Global Note may hold their
interests in the Global Note directly through DTC if such person is a
participant in DTC or indirectly through organizations that are
participants in DTC (the "Participants"). Persons who are not
Participants may beneficially own interests in the Global Note held by
DTC only through Participants or certain banks, brokers, dealers, trust
companies and other parties that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly
("Indirect Participants"). So long as Cede & Co., as the nominee of
DTC, is the registered owner of the Global Note, Cede & Co. for all
purposes will be considered the sole holder of the Global Note. Owners
of beneficial interests in the Global Note will be entitled to have
certificates registered in their names and to receive physical delivery
of Certificated Notes.
Payment of principal of and premium, interest and Liquidated
Damages, if any, on the Global Note will be made to Cede & Co., the
nominee for DTC, as registered owner of the Global Note, by wire
transfer of immediately available funds on the applicable payment date.
Neither of the Company nor the Trustee will have any responsibility or
liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests in the Global Note or for
maintaining, supervising or reviewing any records relating to such
beneficial ownership interest.
The Company has been informed by DTC that, with respect to any
payment of principal of, or premium, interest or Liquidated Damages, if
any, on the Global Note, DTC's practice is to credit Participants'
accounts on the applicable payment date, with payments in amounts
proportionate to their respective beneficial interests in the Notes
represented by the Global Note as shown on the records of DTC, unless
DTC has reason to believe that it will not receive payment on such
payment date. Payments by Participants to owners of beneficial
interests in the Notes represented by the Global Note held through such
Participants will be the responsibility of such Participants, as is now
the case with securities held for the accounts of customers registered
in "street name."
Transfers between Participants will be effected in the ordinary
way in accordance with DTC's rules and will be settled in immediately
available funds. The laws of some states require that certain persons
take physical delivery of securities in definitive form. Consequently,
the ability to transfer beneficial interests in a Global Note to such
persons may be limited. Because DTC can only act on behalf of
Participants, who in turn act on behalf of Indirect Participants and
certain banks and other parties, the ability of a person having a
beneficial interest in the Notes represented by the Global Note to
pledge such interest to persons or entities that do not participate in
the DTC system, or otherwise take actions in respect of such interest,
may be affected by the lack of a physical certificate evidencing such
interest.
Neither the Company nor the Transfer Agent will have
responsibility for the performance of DTC or its Participants or
Indirect Participants of their respective obligations under the rules
and procedures governing their operations. DTC has advised the Company
that it will take any action permitted to be taken by a holder of Notes
(including, without limitation, the presentation of Notes for exchange
as described below) only at the direction of one or more Participants to
whose account with DTC interests in the Global Note are credited, and
only in respect of the Notes represented by the Global Note as to which
such Participant or Participants has or have given such direction.
DTC has advised the Company that DTC is a limited purpose trust
company organized under the laws of the State of New York , a member of
the Federal Reserve System, a "clearing corporation" within the meaning
of the Uniform Commercial Code and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Exchange Act. DTC was
created to hold securities for its Participants and to facilitate the
clearance and settlement of securities transactions between Participants
through electronic book-entry changes to accounts of its Participants,
thereby eliminating the need for physical movement of certificates.
Participants include securities brokers and dealers, banks, trust
companies and clearing corporations and may include certain other
organizations such as the Initial Purchasers. Certain of such
Participants (or their representatives), together with other entities,
own DTC. Indirect access to the DTC system is available to others such
as banks, brokers, dealers and trust companies that clear through, or
maintain a custodial relationship with, a Participant, either directly
or indirectly.
Although DTC has agreed to the foregoing procedures in order to
facilitate transfers of interests in the Global Note among Participants,
it is under no obligation to perform or continue to perform such
procedures, and such procedures may be discontinued at any time. If DTC
is at any time unwilling or unable to continue as depositary and a
successor depositary is not appointed by the Company within 90 days, the
Company will cause Certificated Notes to be issued in exchange for the
Global Notes.
Certificated Notes
Investors in the Notes may request that Certificated Notes be
issued in exchange for Notes represented by the Global Note.
Furthermore, Certificated Notes may be issued in exchange for Notes
represented by the Global Note if no successor depositary is appointed
by the Company as set forth above.
Unless determined otherwise by the Company in accordance with
applicable law, Certificated Notes issued upon transfer or exchange of
beneficial interests in Notes represented by the Global Note will bear a
legend setting forth transfer restrictions under the Securities Act as
set forth under "Notice to Investors." Any request for the transfer of
Certificated Notes bearing the legend, or for removal of the legend from
Certificated Notes, must be accompanied by satisfactory evidence, in the
form of an opinion of counsel, that such transfer complies with the
Securities Act or that neither the legend nor the restrictions on
transfer set forth therein are required to ensure compliance with the
provisions of the Securities Act, as the case may be.
Registration Rights; Liquidated Damages
Pursuant to the Registration Rights Agreement, the Company and the
Guarantors agreed to file the Exchange Offer Registration Statement with
the Commission with respect to the Exchange Offer. Upon the
effectiveness of the Exchange Offer Registration Statement, the Company
will offer to the holders of Old Notes pursuant to the Exchange Offer
who are able to make certain representations the opportunity to exchange
their Old Notes for New Notes. If (a) the Company and the Guarantors
are not permitted to consummate the Exchange Offer because the Exchange
Offer is not permitted by applicable law or Commission policy or (b) any
holder of Transfer Restricted Securities notifies the Company prior to
the 20th day following consummation of the Exchange Offer that (i) it is
prohibited by law or Commission policy from participating in the
Exchange Offer or (ii) that it may not resell the New Notes acquired by
it in the Exchange Offer to the public without delivering a prospectus
and the prospectus contained in the Exchange Offer Registration
Statement is not available for such resales, the Company will file with
the Commission a Shelf Registration Statement to cover resales of the
Old Notes by the holders thereof who satisfy certain conditions relating
to the provision of information in connection with the Shelf
Registration Statement. The Company will use its reasonable best
efforts to cause the applicable registration statement to be declared
effective as promptly as possible by the Commission. For purposes of
the foregoing, "Transfer Restricted Securities" means each Old Note
until (A) the date on which such Old Note has been exchanged by a person
other than a broker-dealer for a New Note in the Exchange Offer,
(B) following the exchange by a broker-dealer in the Exchange Offer of
an Old Note for an New Note, the date on which such New Note is sold to
a purchaser who receives from such broker-dealer on or prior to the date
of such sale a copy of the prospectus contained in the Exchange Offer
Registration Statement, (C) the date on which such Old Note has been
effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration Statement or (D) the date on
which such Old Note is distributed to the public pursuant to Rule 144
under the Securities Act or may be distributed to the public pursuant to
Rule 144(k) under the Securities Act.
The Registration Rights Agreement provides that (a) the Company
will file the Exchange Offer Registration Statement with the Commission
on or prior to 60 days after the date on which the Old Notes are
originally issued under the Indenture (the "Closing Date"), (b) the
Company will use its reasonable best efforts to have the Exchange Offer
Registration Statement declared effective by the Commission on or prior
to 120 days after the Closing Date, (c) unless the Exchange Offer would
not be permitted by applicable law or Commission policy, the Company
will commence the Exchange Offer and use its reasonable best efforts to
issue, on or prior to 180 days after the Closing Date, New Notes in
exchange for all Old Notes tendered prior thereto in the Exchange Offer
and (d) if obligated to file the Shelf Registration Statement, the
Company will use its reasonable best efforts to file the Shelf
Registration Statement with the Commission on or prior to 60 days after
such filing obligation arises and to cause the Shelf Registration
Statement to be declared effective by the Commission on or prior to 120
days after such obligation arises. If (i) the Company fails to file any
of the Registration Statements required by the Registration Rights
Agreement on or before the date specified for such filing, (ii) any of
such Registration Statements is not declared effective by the Commission
on or prior to the date specified for such effectiveness, (iii) the
Company fails to consummate the Exchange Offer within 180 days of the
Closing Date with respect to the Exchange Offer Registration Statement
or (iv) the Shelf Registration Statement or the Exchange Offer
Registration Statement is declared effective but thereafter ceases to be
effective or usable in connection with resales of Transfer Restricted
Securities during the periods specified in the Registration Rights
Agreement (each such event referred to in clauses (i) through (iv)
above, a "Registration Default"), then the Company will pay Liquidated
Damages to each holder of Transfer Restricted Securities with respect to
the first 90-day period immediately following the occurrence of the
first Registration Default in an amount equal to $.05 per week per
$1,000 principal amount of Transfer Restricted Securities held by such
holder. The amount of Liquidated Damages will increase by an additional
$.05 per week per $1,000 principal amount of Transfer Restricted
Securities with respect to each subsequent 90-day period until all
Registration Defaults have been cured, up to a maximum amount of
Liquidated Damages of $.20 per week per $1,000 principal amount of
Transfer Restricted Securities. All accrued Liquidated Damages with
respect to Transfer Restricted Securities will be paid by the Company on
each Damages Payment Date (as defined in the Registration Rights
Agreement) to the Global Note holder by wire transfer of immediately
available funds or by federal funds check and to holders of Certificated
Securities by wire transfer to the accounts specified by them or by
mailing checks to their registered addresses if no such accounts have
been specified. Following the cure of all Registration Defaults, the
accrual of Liquidated Damages will cease.
Holders of Old Notes will be required to make certain customary
representations to the Company in order to participate in the Exchange
Offer and will be required to deliver information to be used in
connection with the Shelf Registration Statement and to provide comments
on the Shelf Registration Statement within the time periods set forth in
the Registration Rights Agreement in order to have their Old Notes
included in the Shelf Registration Statement and benefit from the
provisions regarding Liquidated Damages set forth above.
Certain Definitions
Set forth below are certain defined terms used in the Indenture.
Reference is made to the Indenture for a full disclosure of all such
terms, as well as any other capitalized terms used herein for which no
definition is provided.
"Affiliate" of any specified Person means an "affiliate" of such
Person, as such term is defined for purposes of Rule 144 under the
Securities Act.
"Asset Sale" means (a) the sale, lease, conveyance or other
disposition (a "disposition") of any assets or rights (including,
without limitation, by way of a sale and leaseback), excluding
disposition in the ordinary course of business (provided that the
disposition of all or substantially all of the assets of the Company and
its Subsidiaries taken as a whole will be governed by the provisions of
the Indenture described above under the caption "--Repurchase at the
Option of Holders--Change of Control" and the provisions described above
under the caption "--Certain Covenants--Merger, Consolidation, or Sale
of Assets" and not by the provisions of the Asset Sales covenant), (b)
the issue or sale by the Company or any of its Restricted Subsidiaries
of Equity Interests of any of the Company's Subsidiaries, and (c) any
Event of Loss, whether, in the case of clause (a), (b) or (c), in a
single transaction or a series of related transactions, provided that
such transaction or series of transactions (i) has a fair market value
in excess of $1.0 million or (ii) results in the payment of net proceeds
in excess of $1.0 million. Notwithstanding the foregoing, the following
transactions will be deemed not to be Asset Sales: (A) a disposition of
obsolete or excess equipment or other assets; (B) a disposition of
assets by the Company to a Wholly Owned Restricted Subsidiary or by a
Wholly Owned Restricted Subsidiary to the Company or to another Wholly
Owned Restricted Subsidiary; (C) a disposition of Equity Interests by a
Wholly Owned Restricted Subsidiary to the Company or to another Wholly
Owned Restricted Subsidiary; (D) a Permitted Investment or Restricted
Payment that is permitted by the Indenture; (E) a disposition of assets
by the Company or any of its Restricted Subsidiaries to a Person that is
an Affiliate of the Company or such restricted Subsidiary and is engaged
in the business of providing marine support vessels and related services
to the oil and gas industry (or a business that is reasonably
complementary or related thereto as determined in good faith by the
Board of Directors), which Person is an Affiliate solely because the
Company or such Restricted Subsidiary has an Investment in such Person,
provided that such transaction complies with the covenant described
under the caption "--Certain Covenants--Transactions with Affiliates";
(F) any charter or lease of any equipment or other assets entered into
in the ordinary course of business and with respect to which the Company
or any Restricted Subsidiary thereof is the lessor, except any such
charter or lease that provides for the acquisition of such assets by the
lessee during or at the end of the term thereof for an amount that is
less than the fair market value thereof at the time the right to acquire
such assets occurs and (G) any trade or exchange by the Company or any
Restricted Subsidiary of equipment or other assets for equipment or
other assets owned or held by another Person, provided that the fair
market value of the assets traded or exchanged by the Company or such
Restricted Subsidiary (together with any cash or Cash Equivalents) is
reasonably equivalent to the fair market value of the assets (together
with any cash or Cash Equivalents) to be received by the Company or such
Restricted Subsidiary. The fair market value of any non-cash proceeds
of a disposition of assets and of any assets referred to in the
foregoing clause (G) of this definition shall be determined in the
manner contemplated in the definition of the term "fair market value,"
the results of which determination shall be set forth in an Officers'
Certificate delivered to the Trustee.
"Attributable Indebtedness" in respect of a sale-and-leaseback
transaction means, at the time of determination, the present value
(discounted at the rate of interest implicit in such transaction,
determined in accordance with GAAP) of the obligation of the lessee for
net rental payments during the remaining term of the lease included in
such sale-and-leaseback transaction (including any period for which such
lease has been extended or may, at the option of the lessor, be
extended). As used in the preceding sentence, the "net rental payments"
under any lease for any such period shall mean the sum of rental and
other payments required to be paid with respect to such period by the
lessee thereunder, excluding any amounts required to be paid by such
lessee on account of maintenance and repairs, insurance, taxes,
assessments, water rates or similar charges. In the case of any lease
that is terminable by the lessee upon payment of penalty, such net
rental payment shall also include the amount of such penalty, but no
rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a
balance sheet in accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation, corporate
stock, (b) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (c) in the case of a partnership or
limited liability company, partnership or membership interests (whether
general or limited), and (d) any other interest or participation that
confers on a Person the right to receive a share of the profits and
losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (a) United States dollars, (b) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of
not more than six months from the date of acquisition, (c) certificates
of deposit and Eurodollar time deposits with maturities of six months or
less from the date of acquisition, bankers' acceptances with maturities
not exceeding six months and overnight bank deposits, in each case with
any commercial bank organized under the laws of any country that is a
member of the Organization for Economic Cooperation and Development
having capital and surplus in excess of $500 million, (d) repurchase
obligations with a term of not more than seven days for underlying
securities of the types described in clauses (b) and (c) above entered
into with any financial institution meeting the qualifications specified
in clause (c) above, (e) commercial paper having the highest rating
obtainable from Moody's Investors Service, Inc. or Standard & Poor's
Rating Service and in each case maturing within 270 days after the date
of acquisition, (f) deposits available for withdrawal on demand with any
commercial bank not meeting the qualifications specified in clause (c)
above, provided all such deposits do not exceed $2.0 million in the
aggregate at any one time, and (g) money market mutual funds
substantially all of the assets of which are of the type described in
the foregoing clauses (a) through (e).
"Common Stock" means the Common Stock of the Company, par value
$.01 per share.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus,
to the extent deducted or excluded in calculating Consolidated Net
Income for such period, (a) an amount equal to any extraordinary loss
plus any net loss realized in connection with an Asset Sale, (b)
provision for taxes based on income or profits of such Person and its
Restricted Subsidiaries, (c) Consolidated Interest Expense of such
Person and its Restricted Subsidiaries and (d) depreciation and
amortization (including amortization of goodwill and other intangibles
but excluding amortization of prepaid cash expenses that were paid in a
prior period) of such Person and its Restricted Subsidiaries, in each
case, on a consolidated basis and determined in accordance with GAAP.
"Consolidated Interest Coverage Ratio" means with respect to any
Person for any period, the ratio of the Consolidated Cash Flow of such
Person for such period to the Consolidated Interest Expense of such
Person for such period; provided, however, that the Consolidated
Interest Coverage Ratio shall be calculated giving pro forma effect to
each of the following transactions as if each such transaction had
occurred at the beginning of the applicable four-quarter reference
period: (a) any incurrence, assumption, guarantee or redemption by the
Company or any of its Restricted Subsidiaries of any Indebtedness (other
than revolving credit borrowings) subsequent to the commencement of the
period for which the Consolidated Interest Coverage Ratio is being
calculated but prior to the date on which the event for which the
calculation of the Consolidated Interest Coverage Ratio is made (the
"Calculation Date"); (b) any acquisition that has been made by the
Company or any of its Restricted Subsidiaries, or approved and expected
to be consummated within 30 days of the Calculation Date, including, in
each case, through a merger or consolidation, and including any related
financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation
Date (in which case Consolidated Cash Flow for such reference period
shall be calculated without giving effect to clause (c) of the proviso
set forth in the definition of Consolidated Net Income); and (c) any
other transaction that may be given pro forma effect in accordance with
Article 11 of Regulation S-X as in effect from time to time; provided
further, however, that (i) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses disposed of prior to the Calculation Date,
shall be excluded and (ii) the Consolidated Interest Expense
attributable to discontinued operations, as determined in accordance
with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the
obligations giving rise to such Consolidated Interest Expense will not
be obligations of the referent Person or any of its Restricted
Subsidiaries following the Calculation Date.
"Consolidated Interest Expense" means, with respect to any Person
for any period, the sum, without duplication, of (a) the consolidated
interest expense of such Person and its Restricted Subsidiaries for such
period, whether paid or accrued (including, without limitation,
amortization of original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in respect of
letter of credit or bankers' acceptance financings, and net payments (if
any) pursuant to Hedging Obligations but excluding amortization of debt
issuance costs) and (b) the consolidated interest expense of such Person
and its Restricted Subsidiaries that was capitalized during such period.
"Consolidated Net Income" means, with respect to any Person for
any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis,
determined in accordance with GAAP, provided that (a) the Net Income
(but not loss) of any Person that is not a Restricted Subsidiary or that
is accounted for by the equity method of accounting shall be included
only to the extent of the amount of dividends or distributions paid in
cash to the referent Person or a Wholly Owned Restricted Subsidiary
thereof, (b) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income
is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary or its stockholders, (c) the
Net Income of any Person acquired in a pooling of interests transaction
for any period prior to the date of such acquisition shall be excluded
and (d) the cumulative effect of a change in accounting principles shall
be excluded.
"Consolidated Net Tangible Assets" means, with respect to any
person as of any date, the sum of the amounts that would appear on a
consolidated balance sheet of such Person and its consolidated
Restricted Subsidiaries as the total assets of such Person and its
consolidated Restricted Subsidiaries, determined on a consolidated basis
in accordance with GAAP and after deducting therefrom, (a) to the extent
otherwise included, unamortized debt discount and expenses and other
unamortized deferred charges, goodwill, patents, trademarks, service
marks, trade names, copyrights, licenses, organization or development
expenses and other intangible items, and (b) the aggregate amount of
liabilities of the Company and its Restricted Subsidiaries which may be
properly classified as current liabilities (including tax accrued as
estimated), determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Worth" means, with respect to any Person as of
any date, the sum of (a) the consolidated equity of the common
stockholders of such Person and its consolidated Restricted Subsidiaries
as of such date plus (b) the respective amounts reported on such
Person's balance sheet as of such date with respect to any series of
preferred stock (other than Disqualified Stock) that by its terms is not
entitled to the payment of dividends unless such dividends may be
declared and paid only out of net earnings in respect of the year of
such declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock, less (i)
all write-ups (other than write-ups resulting from foreign currency
translations and write-ups of tangible assets of a going concern
business made within 12 months after the acquisition of such business)
subsequent to the date of the Indenture in the book value of any asset
owned by such Person or a consolidated Restricted Subsidiary of such
Person, (ii) all investments as of such date in unconsolidated
Subsidiaries and in Persons that are not Restricted Subsidiaries and
(iii) all unamortized debt discount and expense and unamortized deferred
charges as of such date, in each case determined in accordance with
GAAP.
"Credit Facility" means that certain Revolving Credit Agreement,
dated as of July 26, 1996, as amended, by and among the Company, its
Subsidiaries named therein, BankBoston, N.A., Hibernia National Bank and
First National Bank of Commerce, including any related notes,
guarantees, collateral documents, instruments and agreements executed in
connection therewith, in each case as amended, restated, modified,
supplemented, extended, renewed, replaced, refinanced or restructured
from time to time, whether by the same or any other agent or agents,
lender or group of lenders, whether represented by one or more
agreements and whether one or more Subsidiaries are added or removed as
borrowers or guarantors thereunder or as parties thereto.
"Default" means any event that is or with the passage of time or
the giving of notice or both would be an Event of Default.
"Disqualified Stock" means any Capital Stock that, by its terms
(or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event, matures
(excluding any maturity as a result of an optional redemption by the
issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature or are redeemed or retired in
full; provided, however, that any Capital Stock that would constitute
Disqualified Stock solely because the holders thereof (or of any
security into which it is convertible or for which it is exchangeable)
have the right to require the issuer to repurchase such Capital Stock
(or such security into which it is convertible or for which it is
exchangeable) upon the occurrence of any of the events constituting an
Asset Sale or a Change of Control shall not constitute Disqualified
Stock if such Capital Stock (and all such securities into which it is
convertible or for which it is exchangeable) provides that the issuer
thereof will not repurchase or redeem any such Capital Stock (or any
such security into which it is convertible or for which it is
exchangeable) pursuant to such provisions prior to compliance by the
Company with the provisions of the Indenture described under the caption
"Repurchase at the Option of Holders--Change of Control" or "Repurchase
at the Option of Holders--Asset Sales," as the case may be.
"Equity Interests" means Capital Stock and all warrants, options
or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Event of Loss" means, with respect to any property or asset of
the Company or any Restricted Subsidiary, (a) any damage to such
property or asset that results in an insurance settlement with respect
thereto on the basis of a total loss or a constructive or compromised
total loss or (b) the confiscation, condemnation or requisition of title
to such property or asset by any government or instrumentality or agency
thereof. An Event of Loss shall be deemed to occur as of the date of
the insurance settlement, confiscation, condemnation or requisition of
title, as applicable.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the Credit
Facility) in existence on the date of the Indenture, until such amounts
are repaid.
The term "fair market value" means, with respect to any asset or
Investment, the fair market value of such asset or Investment at the
time of the event requiring such determination, as determined in good
faith by the Board of Directors of the Company, or, with respect to any
asset or Investment in excess of $5.0 million (other than cash or Cash
Equivalents), as determined by a reputable appraisal firm that is, in
the judgment of such Board of Directors, qualified to perform the task
for which such firm has been engaged and independent with respect to the
Company.
"Funded Indebtedness" means any Indebtedness for money borrowed
that by its terms matures at, or is extendible or renewable at the
option of the obligor to, a date more than 12 months after the date of
the incurrence of such Indebtedness.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as have been approved by a
significant segment of the accounting profession of the United States,
which are in effect from time to time.
"Hedging Obligations" means, with respect to any person, the
obligations of such Person under (a) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, (b)
other agreements or arrangements designed to protect such Person against
fluctuations in interest rates and (c) any foreign currency futures
contract, option or similar agreement or arrangement designed to protect
such Person against fluctuations in foreign currency rates, in each case
to the extent such obligations are incurred in the ordinary course of
business of such Person.
"Indebtedness" means, with respect to any Person, any indebtedness
of such Person, whether or not contingent, in respect of borrowed money
or evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof) or
banker's acceptances or representing Capital Lease Obligations or the
balance deferred and unpaid of the purchase price of any property or
representing any Hedging Obligations, except any such balance that
constitutes an accrued expense or trade payable, if and to the extent
any of the foregoing indebtedness (other than letters of credit and
Hedging Obligations) would appear as a liability upon a balance sheet of
such Person prepared in accordance with GAAP. The amount of any
Indebtedness outstanding as of any date shall be (a) the accreted value
thereof, in the case of any Indebtedness that does not require current
payments of interest, and (b) the principal amount thereof, in the case
of any other Indebtedness.
"Investments" means, with respect to any Person, all investments
by such Person in other Persons (including Affiliates) in the forms of
direct or indirect loans (including guarantees by the referent Person
of, and Liens on any assets of the referent Person securing,
Indebtedness or other obligations of other Persons), advances or capital
contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities, together with all items that are
or would be classified as investments on a balance sheet prepared in
accordance with GAAP; provided, however, that the following shall not
constitute Investments: (i) extensions of trade credit or other advances
to customers on commercially reasonable terms in accordance with normal
trade practices or otherwise in the ordinary course of business, (ii)
Hedging Obligations and (iii) endorsements of negotiable instruments and
documents in the ordinary course of business. If the Company or any
Restricted Subsidiary of the Company sells or otherwise disposes of any
Equity Interests of any direct or indirect Restricted Subsidiary of the
Company such that, after giving effect to any such sale or disposition,
such Person is no longer a Restricted Subsidiary of the Company, the
Company shall be deemed to have made an Investment on the date of any
such sale or disposition equal to the fair market value of the Equity
Interests of such Restricted Subsidiary not sold or disposed of in an
amount determined as provided in the final paragraph of the covenant
described above under the caption "--Certain Covenants--Restricted
Payments."
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect
of such asset, whether or not filed, recorded or otherwise perfected
under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof, any option or
other agreement to sell or give a security interest in and any filing of
or agreement to give any financing statement under the Uniform
Commercial Code (or equivalent statutes) of any jurisdiction other than
a precautionary financing statement respecting a lease not intended as a
security agreement).
"Make Whole Amount" with respect to a Note means an amount equal
to the excess, if any, of (i) the present value of the remaining
interest, premium and principal payments due on such Note as if such
Note were redeemed on August 1, 2001, computed using a discount rate
equal to the Treasury Rate plus 50 basis points, over (ii) the
outstanding principal amount of such Note. "Treasury Rate" is defined
as the yield to maturity at the time of the computation of United States
Treasury securities with a constant maturity (as compiled by and
published in the most recent Federal Reserve Statistical Release
H.15(519), which has become publicly available at least two business
days prior to the date of the redemption notice or, if such Statistical
Release is no longer published, any publicly available source of similar
market date) most nearly equal to the then remaining maturity of the
Notes assuming redemption of the Notes on August 1, 2001; provided,
however, that if the Make-Whole Average Life of such Note is not equal
to the constant maturity of the United States Treasury security for
which a weekly average yield is given, the Treasury Rate shall be
obtained by linear interpolation (calculated to the nearest one-twelfth
of a year) from the weekly average yields of United States Treasury
securities for which such yields are given, except that if the Make-
Whole Average Life of such Notes is less than one year, the weekly
average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used. "Make-Whole
Average Life" means the number of years (calculated to the nearest one-
twelfth) between the date of redemption and August 1, 2001.
"Make-Whole Price" with respect to a Note means the greater of (i)
the sum of the outstanding principal amount and Make-Whole Amount of
such Note, and (ii) the redemption price of such Note on August 1, 2001,
determined pursuant to the Indenture (104.250% of the principal amount).
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however,
(a) any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with (i) any
Asset Sale (including, without limitation, dispositions pursuant to
sale-and-leaseback transactions) or (ii) the disposition of any
securities by such Person or any of its Restricted Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its
Restricted Subsidiaries and (b) any extraordinary or nonrecurring gain
(but not loss), together with any related provision for taxes on such
extraordinary or nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset
Sale (including without limitation, any cash received upon the sale or
other disposition of any non-cash consideration received in any Asset
Sale), net of (without duplication) (a) the direct costs relating to
such Asset Sale (including, without limitation, legal, accounting and
investment banking fees, sales commissions, recording fees, title
transfer fees, title insurance premiums, appraiser fees and costs
incurred in connection with preparing such assets for sale) and any
relocation expenses incurred as a result thereof, (b) taxes paid or
estimated to be payable as a result thereof (after taking into account
any available tax credits or deductions and any tax sharing
arrangements), (c) amounts required to be applied to the repayment of
Indebtedness (other than under the Credit Facility) secured by a Lien on
the asset or assets that were the subject of such Asset Sale, (d) any
reserve established in accordance with GAAP or any amount placed in
escrow, in either case for adjustment in respect of the sale price of
such asset or assets, until such time as such reserve is reversed or
such escrow arrangement is terminated, in which case Net Proceeds shall
include only the amount of the reserve so reversed or the amount
returned to the Company or its Restricted Subsidiaries from such escrow
arrangement, as the case may be.
"Non-Recourse Debt" means Indebtedness (a) as to which neither the
Company nor any of its Restricted Subsidiaries (i) provides credit
support of any kind (including any undertaking, agreement or instrument
that would constitute Indebtedness) or is otherwise directly or
indirectly liable (as a guarantor or otherwise) or (ii) constitutes the
lender, (b) no default with respect to which (including any rights the
holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or
both) the holders of Indebtedness of the Company or any of its
Restricted Subsidiaries to declare a default on such Indebtedness or
cause the payment thereof to be accelerated or payable prior to its
stated maturity and (c) as to which the lenders have been notified in
writing that they will not have any recourse to the stock or assets of
the Company or any of its Restricted Subsidiaries, except to the extent
of any Indebtedness incurred by the Company or any of its Restricted
Subsidiaries in accordance with clause (a)(i) above.
"Pari Passu Indebtedness" means, with respect to any Net Proceeds
from Assets Sales, Indebtedness of the Company and its Restricted
Subsidiaries the terms of which require the Company or such Restricted
Subsidiary to apply such Net Proceeds to offer to repurchase such
Indebtedness.
"Permitted Investments" means (a) any Investment in the Company or
in a Wholly Owned Restricted Subsidiary of the Company, (b) any
Investment in Cash Equivalents, (c) any Investment by the Company or any
Restricted Subsidiary of the Company in a Person if as a result of such
Investment (i) such Person becomes a Wholly Owned Restricted Subsidiary
of the Company or (ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys all or substantially
all of its assets to, or is liquidated into, the Company or a Wholly
Owned Restricted Subsidiary of the Company, (d) any Investment made as a
result of the receipt of non-cash consideration from (i) an Asset Sale
that was made pursuant to and in compliance with the covenant described
above under the caption "--Repurchase at the Option of Holders--Asset
Sales" or (ii) a disposition of assets that does not constitute an Asset
Sale and (e) Investments in a Person engaged principally in the business
of providing marine support vessels and related services to the oil and
gas industry or businesses reasonably complementary or related thereto
provided that the aggregate amount of such Investments pursuant to this
clause (e) in Persons that are not Restricted Subsidiaries or the
Company shall not exceed $20.0 million at any one time.
"Permitted Liens" means (a) Liens securing Indebtedness incurred
pursuant to clause (a) of the second paragraph of the covenant entitled
"--Incurrence of Indebtedness and Issuance of Preferred Stock" plus
additional Indebtedness under the Credit Facility not to exceed an
amount equal to 15% of Consolidated Net Tangible Assets, (b) Liens in
favor of the Company and its Restricted Subsidiaries, (c) Liens on
property of a Person existing at the time such Person is merged into or
consolidated with the Company or any Restricted Subsidiary of the
Company, provided that such Liens were in existence prior to its
contemplation of such merger or consolidation and do not extend to any
property other than those of the Person merged into or consolidated with
the Company or any of its Restricted Subsidiaries, (d) Liens on property
existing at the time of acquisition thereof by the Company or any
Restricted Subsidiary of the Company, provided that such Liens were in
existence prior to its contemplation of such acquisition and do not
extend to any other property, (e) Liens to secure the performance of
statutory obligations, surety or appeal bonds, bid or performance bonds,
insurance obligations or other obligations of a like nature incurred in
the ordinary course of business, (f) Liens securing Hedging Obligations,
(g) Liens existing on the date of the Indenture, (h) Liens securing Non-
Recourse Debt, (i) any interest or title of a lessor under a Capital
Lease Obligation or an operating lease, (j) Liens arising by reason of
deposits necessary to obtain standby letters of credit in the ordinary
course of business, (k) Liens on real or personal property or assets of
the Company or a Restricted Subsidiary thereof to secure Indebtedness
incurred for the purpose of (i) financing all or any part of the
purchase price of such property or assets incurred prior to, at the time
of, or within 120 days after, the acquisition of such property or assets
or (ii) financing all or any part of the cost of construction of any
such property or assets, provided that the amount of any such financing
shall not exceed the amount expended in the acquisition of, or the
construction of, such property or assets and such Liens shall not extend
to any other property or assets of the Company or a Restricted
Subsidiary (other than any associated accounts, contracts and insurance
proceeds), (l) Liens securing Permitted Refinancing Indebtedness with
respect to any Indebtedness referred to in clause (k) above, and (m)
Liens incurred in the ordinary course of business of the Company or any
Restricted Subsidiary of the Company with respect to obligations that do
not exceed $5.0 million at any one time outstanding and that (1) are not
incurred in connection with the borrowing of money or the obtaining of
advances or credit (other than trade credit in the ordinary course of
business) and (2) do not in the aggregate materially detract from the
value of the property or materially impair the use thereof in the
operation of business by the Company or such Restricted Subsidiary.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or
the net proceeds of which are used to extend, refinance, renew, replace,
defease or refund other Indebtedness of the Company or any of its
Restricted Subsidiaries; provided, however, that (a) the principal
amount (or accreted value, if applicable) of such Permitted Refinancing
Indebtedness does not exceed the principal amount of (or accreted value,
if applicable) plus premium, if any, and accrued interest on the
Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of reasonable expenses incurred in connection
therewith); (b) such Permitted Refinancing Indebtedness has a final
maturity date no earlier than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the Weighted
Average Life to Maturity of, the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; (c) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness is subordinated in right of payment
to the Notes on terms at least as favorable to the holders of Notes as
those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded and (d)
such Indebtedness is incurred either by the Company or by the Restricted
Subsidiary that is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; provided, however,
that a Restricted Subsidiary may guarantee Permitted Refinancing
Indebtedness incurred by the Company, whether or not such Restricted
Subsidiary was an obligor or guarantor of the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded, provided
further, however, that if such Permitted Refinancing Indebtedness is
subordinated to the Notes, such guarantee shall be subordinated to such
Restricted Subsidiary's Subsidiary Guarantee to at least the same
extent.
"Productive Assets" means vessels or other assets (other than
assets that would be classified as current assets in accordance with
GAAP) of the kind used or usable by the Company or its Restricted
Subsidiaries in the business of providing marine support vessels and
related services to the oil and gas industry (or any business that is
reasonably complementary or related thereto as determined in good faith
by the Board of Directors).
"Qualified Equity Offering" means (a) any sale of Equity Interests
(other than Disqualified Stock) of the Company pursuant to an
underwritten offering registered under the Securities Act or (b) any
sale of Equity Interests (other than Disqualified Stock) of the Company
so long as, at the time of consummation of such sale, the Company has a
class of common equity securities registered pursuant to Section 12(b)
or Section 12(g) under the Exchange Act.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of such
Person that is not an Unrestricted Subsidiary.
"Significant Subsidiary" means (a) any Restricted Subsidiary of
the Company that would be a "significant subsidiary" as defined in
Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the
Securities Act, as such Regulation is in effect on the date of
Indenture, (b) any other Restricted Subsidiary of the Company that
provides a guarantee under the Credit Facility or incurs any Funded
Indebtedness and (c) their respective successors and assigns.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which
such payment of interest or principal was scheduled to be paid in the
original documentation governing such Indebtedness, and shall not
include any contingent obligations to repay, redeem or repurchase any
such interest or principal prior to the date originally scheduled for
the payment thereof.
"Subsidiary" means, with respect to any Person, (a) any
corporation, association or other business entity of which more than 50%
of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person (or a combination thereof) and (b) any
partnership (i) the sole general partner or the managing general partner
of which is such Person or a Subsidiary of such Person or (ii) the only
general partners of which are such Person or of one or more Subsidiaries
of such Person (or any combination thereof).
"Unrestricted Subsidiary" means any Subsidiary that is designated
by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution of the Board of Directors, but only to the extent that such
Subsidiary at the time of such designation (a) has no Indebtedness other
than Non-Recourse Debt, (b) is not party to any agreement, contract,
arrangement or understanding with the Company or any Restricted
Subsidiary of the Company unless such agreement, contract, arrangement
or understanding does not violate the terms of the Indenture described
under the caption "--Certain Covenants--Transactions with Affiliates,"
and (c) is a Person with respect to which neither the Company nor any of
its Restricted Subsidiaries has any direct or indirect obligation (i) to
subscribe for additional Equity Interests or (ii) to maintain or
preserve such Person's financial condition or to cause such Person to
achieve any specified levels of operating results, in each case, except
to the extent otherwise permitted by the Indenture. Any such
designation by the Board of Directors shall be evidenced to the Trustee
by filing with the Trustee a certified copy of the resolution of the
Board of Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
conditions and was permitted by the covenant described above under the
caption "--Certain Covenants--Restricted Payments." If, at any time,
any Unrestricted Subsidiary would fail to meet the foregoing
requirements as an Unrestricted Subsidiary, it shall thereafter cease to
be an Unrestricted Subsidiary for purposes of the Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a
Restricted Subsidiary of the Company as of such date (and, if such
Indebtedness is not permitted to be incurred as of such date under the
covenant described under the caption "--Incurrence of Indebtedness and
Issuance of Preferred Stock," the Company shall be in default of such
covenant). The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary,
provided that such designation shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of the Company of any
outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (A) such Indebtedness is
permitted under the covenant described under the caption "--Incurrence
of Indebtedness and Issuance of Preferred Stock," calculated on a pro
forma basis as if such designation had occurred at the beginning of the
four-quarter reference period, and (B) no Default or Event of Default
would be in existence following such designation.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a)
the sum of the products obtained by multiplying (i) the amount of each
then remaining installment, sinking fund, serial maturity or other
required payments of principal, including payment at final maturity, in
respect thereof, by (ii) the number of years (calculated to the nearest
one twelfth) that will elapse between such date and the making of such
payment, by (b) the then outstanding principal amount of such
Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person to the extent (a) all of the
outstanding Capital Stock or other ownership interests of which (other
than directors' qualifying shares) shall at the time be owned directly
or indirectly by such Person or (b) such Restricted Subsidiary is
organized in a foreign jurisdiction and is required by the applicable
laws and regulations of such foreign jurisdiction to be partially owned
by the government of such foreign jurisdiction or individual or
corporate citizens of such foreign jurisdiction in order for such
Restricted Subsidiary to transact business in such foreign jurisdiction,
provided that such Person, directly or indirectly, owns the remaining
Capital Stock or ownership interests in such Restricted Subsidiary and,
by contract or otherwise, controls the management and business of such
Restricted Subsidiary and derives the economic benefits of ownership of
such Restricted Subsidiary to substantially the same extent as if such
Subsidiary were a wholly owned Restricted Subsidiary.
LEGAL MATTERS
The validity of the Notes will be passed upon by Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., New Orleans, Louisiana.
EXPERTS
The consolidated balance sheet as of December 31, 1995 and 1996
and the consolidated statements of operations, stockholders' equity and
cash flows for each of the three years in the period ended December 31,
1996, and related financial statement schedule incorporated by reference
in this Prospectus, have been incorporated herein in reliance on the
reports of Coopers & Lybrand, L.L.P., independent accountants, given on
the authority of that firm as experts in accounting and auditing.
No dealer, salesman or other $110,000,000
individual has been authorized to
give any information or to make TRICO MARINE
any representations not in, or SERVICES, INC.
incorporated in, this Prospectus,
in connection with the Exchange Offer for All Outstanding
Offer covered by this Prospectus. 8 1/2% Series A Senior Notes Due 2005
If given or made, such information in Exchange for
or representations must not be 8 1/2% Series B Senior Notes Due 2005
relied upon as having been
authorized by the Company. This
Prospectus does not constitute an
offer to sell, or a solicitation
of an offer to buy, any security
other than the New Notes offered
hereby, nor does it constitute an
offer to sell or a solicitation of
an offer to buy any of the New PROSPECTUS
Notes to anyone or by anyone in
any jurisdiction where, or to any
person to whom, it would be
unlawful to make such an offer or
solicitation. Neither the
delivery of this Prospectus nor
any sale made hereunder shall,
under any circumstances, create an
implication that there has not August 26, 1997
been a change in the information
set forth in this Prospectus or
incorporated by reference herein
or in the affairs of the Company
since the date hereof.
_______________
TABLE OF CONTENTS
Page
Available Information i
Incorporation of Certain Documents
by Reference i
Summary 1
Risk Factors 6
Use of Proceeds 11
Capitalization 11
Selected Consolidated Financial
and
Operating Data 12
The Exchange Offer 14
Description of the Notes 21
Legal Matters 43
Experts 43
