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EXHIBIT 4.9
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Amendment”
) is dated as of December 1, 2006 and is entered into by and among
J.
RAY MCDERMOTT, S.A. , a Panamanian corporation (the “
Borrower” ),
CERTAIN
OF THE GUARANTORS executing the signature pages hereto,
CERTAIN FINANCIAL
INSTITUTIONS listed on the signature pages hereto (the
“Lenders”
), and CREDIT
SUISSE, CAYMAN ISLANDS BRANCH , as Administrative Agent (in
such capacity, “Administrative
Agent” ) and as Collateral Agent (in such capacity,
“Collateral
Agent” ), and is made with reference to that certain
CREDIT
AGREEMENT dated as of June 6, 2006 (as amended by the First
Amendment dated August 4, 2006, the “Credit
Agreement” ) by and among Borrower, Lenders,
Administrative Agent and the other agents party
thereto. Capitalized terms used herein without
definition shall have the same meanings herein as set forth in the
Credit Agreement after giving effect to this
Amendment.
RECITALS
WHEREAS, the Borrower has requested that Requisite Lenders
agree to amend certain provisions of the Credit Agreement and the
Pledge and Security Agreement as provided for herein;
and
WHEREAS, subject to certain conditions, Requisite Lenders
are willing to agree to such amendments.
NOW, THEREFORE , in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties
hereto agree as follows:
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1.1
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Amendments to Section
1: Definitions .
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A. Section
1.1 of the Credit Agreement is hereby amended by adding the
following definitions in proper alphabetical sequence:
“
Reorganization
” means the transfer of certain Subsidiaries and Joint
Ventures of the Borrower such that, upon the completion
thereof, the ownership structure of such Subsidiaries and
Joint Ventures shall be substantially as set forth in Exhibit
A to the Second Amendment ( provided that (i)
all of the Stock of such Subsidiaries and Joint Ventures that
is owned, directly or indirectly, by the Borrower on the date
of the Second Amendment, shall be owned, directly or
indirectly, by the Borrower and one or more wholly-owned
subsidiaries of MII during and upon the completion of the
Reorganization and (ii) each of the Borrower and McDermott
Cayman Holdings, Ltd. shall receive Fair Market Value in
connection with such transfer).
“
Reorganization
Excluded
Subsidiary ” means a Subsidiary of the Borrower
which was formed after the Second Amendment Effective Date
solely in connection with the Reorganization and whose purpose
is to facilitate consummation of the Reorganization and that,
prior to the consummation of the Asset Sale permitted by
Section 8.4(m) of this Agreement, will own no assets other
than (i) the Stock of the Transferred Subsidiaries, the
Transferred Joint Ventures and other Reorganization Excluded
Subsidiaries and (ii) de minimus amounts of cash contributed
in connection with the Reorganization.
“
Second
Amendment ” means that certain Second Amendment
to Credit Agreement dated as of December 1, 2006 among the
Borrower, the Administrative Agent, the Collateral Agent and
the Lenders listed on the signature pages
thereto.
“
Second
Amendment Effective Date ” means the date of
satisfaction of the conditions referred to in Section III of
the Second Amendment.
“
Transferred
Joint Ventures ” means each of the Joint Ventures
of the Borrower listed on Schedule 1 to the Second Amendment,
the Stock of which is owned, directly or indirectly, by the
Borrower, each of which shall be transferred to an Affiliate
of the Borrower pursuant to the Reorganization.
“
Transferred
Subsidiaries ” means each of the Subsidiaries of
the Borrower listed on Schedule 2 to the Second Amendment, the
Stock of which is owned, directly or indirectly, by the
Borrower, each of which shall be transferred to an Affiliate
of the Borrower pursuant to the Reorganization; provided , that
each such Transferred Subsidiary that was a Guarantor
immediately prior to the Second Amendment Effective Date (i)
shall continue to remain a Guarantor after the consummation of
the Asset Sale permitted by Section 8.4(m) of this Agreement,
(ii) shall continue to grant the Collateral Agent, for the
benefit of the Secured Parties, liens on its assets pursuant
to the Collateral Documents after the consummation of the
Asset Sale permitted by Section 8.4(m) of this Agreement and
(iii) shall execute the Second Amendment and be bound by the
relevant terms of the Credit Agreement as set forth in the
Second Amendment.
B. Section
1.1 of the Credit Agreement is hereby further amended by deleting
the definitions of “Guarantors”, “Joint
Venture” and “Subsidiary” therein and
replacing them with the following:
““ Guarantor
s
” means each Wholly-Owned Subsidiary of the Borrower,
each Mortgaged Vessel Owning Subsidiary, each direct parent
company of a Mortgaged Vessel Owning Subsidiary (other than a
Reorganization Excluded Subsidiary and Barmada McDermott Sdn.
Bhd.), each Transferred Subsidiary that was a Guarantor
immediately prior to the Second Amendment Effective Date, and
any other Subsidiary that is deemed to be a Guarantor
pursuant to Section 7.13
hereof; provided that no
Captive Insurance Subsidiary nor any Reorganization Excluded
Subsidiary shall be a Guarantor.”
““ Joint Venture
” means any Person (i) in which the Borrower or a
Guarantor, directly or indirectly, owns at least 30% of the
Stock or Stock Equivalents of such Person and (ii) that is
not a Subsidiary of the Borrower or a
Guarantor. As of the Effective Date, the Persons
listed on Schedule 1.1 are Joint
Ventures.”
““ Subsidiary
” means, with respect to the Borrower or a Guarantor,
as applicable, any Person in which the Borrower or such
Guarantor, directly or indirectly, owns any of the Stock or
Stock Equivalents of such Person; provided that
(x)(i) the financial statements of such Person will be (or
should have been) consolidated with the financial statements
of the Borrower (or such Guarantor, as applicable) in
accordance with GAAP and (ii) the Borrower (or such
Guarantor, as applicable), directly or indirectly, controls
or has the power to direct or cause the direction of the
management and policies thereof, or (y) with respect to the
Borrower, such Person is a Transferred Subsidiary or a
Subsidiary of a Transferred Subsidiary (unless such
Transferred Subsidiary or Subsidiary thereof has been sold or
otherwise disposed of in a manner that is permitted by
Section
8.4 (assuming for such purposes that the direct parent
of each Transferred Subsidiary and Subsidiary thereof is
bound by Section 8.4
regardless of whether it is actually so bound));
provided ,
further ,
however , that
for purposes of Article IV ,
Article
VII and Article VIII
(excluding Section 8.1 ),
the definition of “Subsidiary” shall not include
any Captive Insurance Subsidiary or any Reorganization
Excluded Subsidiary.”
C. Section
1.1 of the Credit Agreement is hereby further amended by deleting
the word “or” and inserting a comma immediately before
clause (c) of the definition of “Change of Control” and
inserting the following language before the period at the end of
such clause (c):
“ or (d)(i) MII shall
cease to own and control, directly or indirectly, such
percentage of the issued and outstanding Stock of the
Transferred Subsidiaries and Transferred Joint Ventures as it
shall own, directly or indirectly, on the date of the Second
Amendment, or (ii) the Borrower shall cease to own, directly
or indirectly at least a minority percentage of the issued
and outstanding Stock of the Transferred
Subsidiaries; provided that
the foregoing clauses (i) and (ii) shall not prevent the
sale, conveyance, transfer, lease or other disposition of, or
sale of shares of Stock of, a Transferred Subsidiary or
Transferred Joint Venture if and to the extent it would have
been permitted by Section 8.4
(assuming for such purposes that the direct parent of each
Transferred Subsidiary and the direct parent of each
Transferred Joint Venture (in each case, to the extent such
parent is an Affiliate of MII) is bound by Section 8.4
regardless of whether it is actually so
bound)”
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1.2
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Amendments to Section
1.3 – Accounting Terms and Principles.
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Section 1.3 of the Credit
Agreement is hereby amended by adding a new paragraph (c)
immediately after paragraph (b) thereof, such paragraph (c)
to read in its entirety as follows:
“(c) If at
any time the financial statements of any of the Transferred
Subsidiaries and their Subsidiaries shall no longer be
consolidated with the financial statements of the Borrower in
accordance with GAAP (whether because Financial Accounting
Standards Board Interpretation Number 46 shall no longer
apply or for any other reason whatsoever), then,
notwithstanding anything in this Agreement to the contrary,
all references in this Agreement to GAAP when used with
respect to the financial statements or financial condition
of, or accounting determinations with respect to, the
Borrower (including, without limitation, in the definitions
of Capital Expenditure, Capital Lease, Capital Lease
Obligations, Consolidated Net Income, Interest Expense,
Leverage Ratio, and Material Subsidiary, but excluding any
such reference to GAAP in Sections 6.1(a) and (b) and 7.7)
shall be construed so as to continue to require the
consolidation of the financial statements of such Transferred
Subsidiaries and their Subsidiaries with those of the
Borrower (such that, for the avoidance of doubt, any
calculation of or use of any of the defined terms in the
foregoing parenthetical shall be made as if the Borrower and
its Subsidiaries and the Transferred Subsidiaries and their
Subsidiaries were considered a consolidated group for such
purposes).”
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1.3
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Amendments to Section
6.1 – Financial Statements .
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Section 6.1 of the Credit
Agreement is hereby amended by inserting a new clause (f)
immediately after clause (e) thereof, such clause (f) to read
in its entirety as follows:
“(f)
Transferred
Subsidiaries . Promptly after any
Responsible Officer obtains knowledge that the financial
statements of the Transferred Subsidiaries are no longer,
or in the next Fiscal Quarter are expected to no longer
be, consolidated with the financial statements of the
Borrower in accordance with GAAP, written notice of such
event (unless such event is the result of an Asset Sale
permitted by this Agreement) shall be given to the
Administrative Agent, and promptly thereafter the Borrower
shall provide to the Administrative Agent, in addition to the
other financial statements required to be delivered
hereunder, consolidated balance sheets and related statements
of income and cash flows for the periods specified in
Sections 6.1(a) and (b) for the Borrower and its Subsidiaries
and the Transferred Subsidiaries and their Subsidiaries on a
consolidated basis (assuming for such purposes that GAAP
would require the consolidation of such financial statements
of such Persons).”
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1.4
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Amendments to
Section 7.11
–
Additional Collateral
and Guaranties.
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A. Section
7.11 of the Credit Agreement is hereby amended by adding the words
“(other than a Reorganization Excluded Subsidiary (excluding
McDermott Cayman Holdings, Ltd., the minority interest of which
shall be required to be pledged by the Borrower in accordance with
Section 7.13(i)))” after the word “Subsidiary” in
clause (a) thereof.
B. Section
7.11 of the Credit Agreement is hereby further amended by adding
the words “or a Reorganization Excluded Subsidiary”
immediately after the words “Captive Insurance
Subsidiary” in each place where such words appear in clause
(c) thereof.
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1.5
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Amendment
to Section 7.13 – Post-Closing Covenants.
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Section 7.13 of the Credit
Agreement is hereby amended by inserting new clauses (g),
(h), (i) and (j) immediately after clause (f) thereof, such
clauses (g), (h), (i) and (j) to read in their entirety as
follows:
“(g) After
the Second Amendment Effective Date but prior to the
consummation of the Reorganization, the Borrower shall
deliver to the Administrative Agent a copy of the limited
liability company agreement or other formation documents,
including all amendments thereto, of J. Ray McDermott
Holdings, LLC (f/k/a J. Ray McDermott Holdings, Inc.) and
each Reorganization Excluded Subsidiary, together with a
certificate as to the good standing of J. Ray McDermott
Holdings, LLC and each Reorganization Excluded Subsidiary as
of a recent date from the appropriate governmental authority
of the jurisdiction of its organization.
(h) After the
Second Amendment Effective Date but prior to such time as the
company that is to be the direct parent of J. Ray McDermott
Holdings, LLC is no longer a direct or indirect Wholly-Owned
Subsidiary of the Borrower, the Borrower shall (i) cause such
direct parent of J. Ray McDermott Holdings, LLC to grant the
Collateral Agent, for the benefit of the Secured Parties, a
valid, legal and perfected first priority security interest
(subject only to Liens permitted under the Credit Agreement)
in the Stock of J. Ray McDermott Holdings, LLC, (ii) deliver
a favorable written opinion of (A) Baker Botts
L.L.P., counsel to the Loan Parties, and (B) John T.
Nesser, General Counsel of the Borrower, each in
substantially the form agreed to by the Administrative Agent
and the Borrower as of the Second Amendment Effective
Date.
(i) Within 10
Business Days after the consummation of the Reorganization
(or such longer period as the Administrative Agent may
determine in its sole discretion), the Borrower shall have
delivered certificates representing 100% of the
Borrower’s interests in McDermott Cayman Holdings,
Ltd., with each such certificate to be accompanied by a stock
power endorsed in blank, and will make or cause to be made
such filings as shall be required to perfect a security
interest in such shares under Cayman Islands
law.
(j) The Borrower
(i) shall have delivered favorable written opinions, in each
case in substantially the form agreed to by the
Administrative Agent and the Borrower as of the Second
Amendment Effective Da
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