UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF EARLIEST EVENT REPORTED: March 1, 2006
ATWOOD OCEANICS, INC.
(Exact name of registrant as specified in its charter)
COMMISSION FILE NUMBER 1-13167
Internal Revenue Service - Employer Identification No. 74-1611874
15835 Park Ten Place Drive, Houston, Texas, 77084
(281) 749-7800
____________
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Atwood Oceanics, Inc. (collectively with its subsidiaries, the "Company")
announced that its wholly owned subsidiary, Atwood Oceanics Pacific Limited
("AOPL"), executed on March 1, 2006, a definitive construction agreement with
Keppel AmFELS, Inc. to construct a mobile self elevating LeTourneau SUPER 116E
design Jack-up. This construction agreement was executed in accordance with a
letter of intent which was disclosed in the Company's Form 8-K filing dated
February 6, 2006. The new rig will be constructed at the Keppel AmFELS yard in
Brownsville, Texas and delivery is expected to occur no later than September 30,
2008. AOPL estimates the total cost of construction (including administrative
and overhead costs and capitalized interest) will be around $160 million. Atwood
Oceanics, Inc. will guarantee certain of AOPL's payment obligations under the
construction agreement. This rig will become the ninth Company owned mobile
offshore drilling unit. A copy of the construction agreement is attached to this
report as Exhibit 10.1
Statements contained in this report with respect to the future are
forward-looking statements. These statements reflect management's reasonable
judgment with respect to future events. Forward-looking statements involve risks
and uncertainties. Actual results could differ materially from those anticipated
as a result of various factors: the Company's dependence on the oil and gas
industry; the risks involved in the construction and repair of a rig;
competition; operating risks; risks involved in foreign operations; risks
associated with a possible disruption in operations due to terrorism; risks
associated with a possible disruption in operations due to war; and governmental
regulations and environmental matters. A list of additional risk factors can be
found in the Company's annual report on Form 10-K for the year ended September
30, 2005, filed with the Securities and Exchange Commission.
ITEM 9.01 FINANCIAL STATEMENT AND EXHIBITS
(d) 10.1 Construction Agreement
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ATWOOD OCEANICS, INC.
(Registrant)
/s/ James M. Holland
James M. Holland
Senior Vice President
DATE: March 2, 2006
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EXHIBIT 10.1
PLATFORM CONSTRUCTION AGREEMENT
BY AND BETWEEN
ATWOOD OCEANICS PACIFIC LIMITED
AND KEPPEL AmFELS, INC.
March 1, 2006
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Section
1. Commencement and Prosecution of the Work
2. Contract Price
3. Parent Guarantee
4. Representatives and Progress of Platform
5. Changes and Additional Work
6. Owner Furnished Equipment
7. Liens
8. Insurance
9. Title and Risk of Loss
10. Delivery
11. Warranty
12. Indemnification Provisions
13. Patent Indemnity
14. General Limitation of Liability
15. Force Majeure
16. Independent Contractor
17. Default
18. Litigation
19. Notice
20. Successors and Assigns
21. Governing Law
22. Modification or Waiver
23. Reliance
24. Waiver of Consumer Rights and Representations of Owner
25. Export Laws
26. Licenses
27. Computation of Time
28. Severability
29. Confidentiality and Ancillary Agreements
30. Construction
Exhibit A
Payment Schedule
Exhibit B
Specifications and Drawing
Exhibit C
Ancillary Agreement
Exhibit D
Confidentiality Agreement
Exhibit E
Parent Guarantee
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PLATFORM CONSTRUCTION AGREEMENT
This Agreement including the Exhibits attached hereto which are
incorporated by reference herein and made a part hereof (hereinafter referred to
as this "Contract"), entered into on the 1st day of March, 2006, by and between
ATWOOD OCEANICS PACIFIC LIMITED, a Cayman Islands corporation (hereinafter
referred to as "Owner") and KEPPEL AmFELS, INC., a corporation organized under
the laws of the State of Texas (hereinafter referred to as "Builder").
W I T N E S S E T H:
1. Commencement and Prosecution of Work
(a) Builder hereby agrees with Owner to commence the
construction of at Builder's shipyard at Brownsville, Texas
("Builder's Yard"), to prosecute in accordance with good
shipyard practice to completion, and to use reasonable
commercial efforts to deliver to Owner by September 30, 2008
(such date as the same may be extended under the terms
of this Agreement is referred to herein as the
"Scheduled Delivery Date"), at Builder's Yard a mobile,
self-contained and elevating LeTourneau Super 116E class
platform, being Builder's Yard No. P199, in accordance with
(i) Builder's specifications 2006.2, dated February 2006
and all related drawings, plans and data, whether now or
hereafter prepared by Builder (hereinafter referred
to collectively as the "Specifications"), the said
Specifications having been (or shall be, in instances where
specifications, drawings, plans, and data are hereafter
prepared) initialed by Builder and Owner as evidence of the
accuracy thereof, being in the form attached hereto as
Exhibit "B", and being (and to be) hereby incorporated by
reference as part of this Agreement and (ii) the certain
rules of the American Bureau of Shipping (hereinafter
referred to as the "ABS"), Rules for Building and Classing
Offshore Mobile Drilling Units, 2005, Part 3, Hull
Construction and Equipment, Sections 1 through 10 which were
in effect and enforced against Builder by the ABS as of the
date of this Agreement and which are specified and limited
in Part I of the Specifications. For purposes of this
Agreement, the mobile, self-contained, and elevating platform
to be constructed and delivered to Owner in accordance
herewith shall be referred to as the "Platform". Owner
hereby agrees with Builder to purchase the Platform from
Builder, and to pay Builder for same, all in accordance
with the provisions of this Agreement.
(b) If any conflict or inconsistency shall arise between this
Agreement and the Specifications, this Agreement shall
prevail. Similarly, if any conflict or inconsistency shall
arise between the written Specifications and the Specification
drawings, the written Specifications shall prevail. In the
event of a dispute as to conformity with ABS classification
requirements, the decision of the ABS shall be final.
(c) Notwithstanding anything in this Agreement to the contrary,
it is expressly understood that the obligations of
Builder under this Agreement are subject to and
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conditioned upon the availability of the Builder's Licensor
LeTourneau, Inc. ("LeTourneau") Kit and License, it being
expressly recognized and agreed by the parties (i) that
Owner paid a deposit to LeTourneau to secure the Kit and
License for the Platform, with the amount of such deposit
to be applied as a credit to Owner in Builder's first invoice
for payment under Section 2 hereof, (ii) that Builder
and LeTourneau are concurrently herewith executing and
delivering a Kit Agreement and License Agreement for the
Platform (the "LeTourneau Agreements"), which have been
approved by Owner and copies of which have been provided to
Owner.
(d) Provided Builder shall not be in default of its obligations
under this Agreement and the LeTourneau Agreements.
Builder shall have no liability of any nature
whatsoever, including damages (whether direct, incidental,
consequential, special, or otherwise) to Owner if LeTourneau
is unable to or otherwise fails or refuses to fully and
timely perform all of its covenants, agreements, and
undertakings under the executed and delivered LeTourneau
Agreements for the Platform or if all subjects and conditions
under the executed and delivered LeTourneau Agreements
for the Platform are not fully and timely met. As used in
this Agreement, "Package" and "Equipment" shall have the
meanings set forth in the executed and delivered LeTourneau
Agreements for the Platform. In the event LeTourneau is
unable to or otherwise fails or refuses to fully and
timely perform all of its covenants, agreements, and
undertakings under the executed and delivered LeTourneau
Agreements for the Platform or if all subjects and
conditions under the executed and delivered LeTourneau
Agreements for the Platform are not fully and timely met and
as a result thereof Builder is delayed in the construction
of the Platform for ninety (90) days, Builder and Owner
shall each have the right to suspend this Agreement and if
the delay continues for an additional ninety (90) days
Builder and Owner shall each have the right to terminate
this Agreement without further liability of either party to
the other except that Builder shall retain all progress
payments made pursuant to Section 2(b) hereinbelow and shall
be paid by Owner for the price for that portion of the
Platform then constructed for which progress payments have
not yet been made and all work in process (including
profit on all to Builder). In the event of suspension as
provided herein, Builder's work on the Platform shall
recommence when LeTourneau resumes its performance and cures
its failure or refusal to fully and timely perform all of
its covenants, agreements, and undertakings under the
executed and delivered LeTourneau Agreements for the Platform.
(f) In the event that any of the equipment or materials required
to be furnished by Builder in the performance of the work
under this Agreement cannot be timely procured or are in short
supply, Builder may supply other materials and equipment
complying with the requirements of this Agreement and the
Specifications.
2. Contract Price.
(a) As consideration for Builder's construction of the Platform in
accordance with the terms of this Agreement, Owner agrees to
pay Builder the sum of U.S. Dollars One Hundred Nine Million
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Six Hundred Ninety One Thousand Six Hundred Eighty Seven only
($109,691,687.00), subject to adjustment as provided in this
Agreement including Exhibit "A" hereto (hereinafter referred
to as the "Contract Price") to Builder's account as provided
herein or at such other place as Builder may from time to time
designate in writing to Owner.
(b) The Contract Price shall be paid by Owner to Builder in
installments as provided in Exhibit "A" attached to and made a
part of this Agreement. Wire transfer shall be made to
Builder's account at JP Morgan Chase Bank as follows:
JP Morgan Chase Bank 1475 Ruben Torres Boulevard
Brownsville, Texas 78521 ACCOUNT NUMBER 06700278275
ABA NUMBER 113000609
(c) Builder shall submit to Owner invoices at least five (5)
working days prior to the date any payment is due under
this Agreement.
(d) Any agreed lump sum change order price shall be paid 50% of
the change order value upon confirmation of change order and
the balance of 50% on the last scheduled installment as
stipulated in subsection (b) above. For change orders
performed on time and material basis, payments shall be made
monthly based upon percentage of completion of the change.
(e) All costs for ABS approvals for the Platform are for the
Builder's account, with the exception of inspections and
certificates for Owner Furnished Equipment.
(f) Prior to delivery of the Platform to Owner, the Builder shall
furnish evidence satisfactory to the Owner showing that no
liens, claims, security interests or rights in rem of any kind
have been or can be acquired against the Platform by, through,
or under Builder. Subject to the provisions of Section 7, the
Platform shall be delivered to Owner free and clear of any
liens or encumbrances whatsoever, together with a Builder's
Certificate and Bill of Sale and such other documents required
by law, any regulatory agency, or this Agreement.
(g) All progress payments, payments for change orders, and other
sums owing by Owner to Builder under this Agreement must be
paid in full at the time of delivery of the Platform under
this Agreement and in any event prior to departure of the
Platform from Builder's Yard. If Owner disputes in good faith
any sums claimed by Builder under or in connection with this
Agreement, Owner shall provide to Builder a corporate surety
bond from a first class U.S. surety acceptable to Builder in a
form reasonable satisfactory to Builder. Such bond shall be in
an amount equal to 150% of the disputed sum. The bond must be
executed and delivered to Builder at the time of delivery of
the Platform under this Agreement and in any event prior to
departure of the Platform from Builder's Yard.
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(h) All amounts owing to a party by the other party pursuant to
this Agreement shall bear interest at the lesser of the
highest lawful rate or the rate equal to the "Prime Rate" as
published in the Wall Street Journal plus three percent (3%)
per annum from the date notice of failure to pay is received
by the party and the party fails to pay same within thirty
(30) days, until paid in full.
3. Parent Guarantee
To induce Builder to enter into this Agreement and at the special
insistence of Builder, Owner concurrently with the execution of this
Agreement shall cause to be executed and delivered to Builder a parent
guarantee of payment from Atwood Oceanics, Inc. in the form attached
hereto as Exhibit "E".
4. Representatives and Progress of Platform.
(a) Builder will furnish office space and parking facilities at
the Builder's Yard for Owner's authorized representatives
(the "Representative"), who will have complete and
unrestricted access to the Builder's Yard, or its
subcontractors, where the Platform under this Agreement
is being constructed. Costs for services (toilet facilities,
air conditioning and lighting), furniture and office
equipment such as telephones, facsimile, computers,
networking, duplicating facilities, long distance telephone
calls, facsimiles, e-mail, and duplication will be for Owner's
account. Such authorized Representatives shall have the
right to make inspection of workmanship, material,
equipment and supplies as the construction of the Platform
progresses and shall notify Builder in writing of any
deficiencies noted therein, and Builder will then take
such steps as are necessary to correct such deficiencies.
Builder shall give notice to Owner and its Representative
at least forty-eight (48) hours in advance of the date and
place of all tests, trials, and inspections. Inspections
shall be made so as not to impede the progress of the
construction of the Platform and if defective or
non-conforming workmanship or material is rejected, rejection
shall be made promptly in order that Builder may minimize the
expense and disruption of construction. In the event
Owner's Representative shall fail to be present at any
properly notified test, trial, or inspection, the results
thereof shall be binding on Owner. Owner shall ensure
that its Representative shall not in performing their
inspections obstruct the construction schedule for the
Platform. If Owner's Representative fails to promptly submit
to Builder notification of any non-conforming work
(within two [2] business days of discovery by Owner)
discovered by Owner's Representative, Owner shall be deemed
to have approved such item and Owner shall be precluded from
making demand for correction of such item, refusing to accept
tender of delivery of the Platform, or claiming such item as
a warranty defect under Builder's warranty set forth in
Section 11 herein below.
(b) In all working hours during the construction of the Platform
until delivery thereof, the Representative and all assistants
of the Representative shall be given free and ready access to
the Platform and to any other place where construction of the
Platform is being done or materials are being processed or
stored in connection with the construction of the Platform,
including the yards, workshops, stores and offices of Builder,
6
and the premises of subcontractors of Builder who are doing
work for the Platform or storing materials at such premises in
connection with the Platform's construction.
(c) Builder shall appoint a project manager who shall be the
direct interface with the Owner's Representative, with full
authority to act for Builder under this Agreement. Owner shall
designate a project manager in writing to Builder, with full
authority to act for Owner under this Agreement. Builder and
Owner may from time to time designate substitute project
managers in writing with such authority.
(d) If any difference in opinion between parties hereto shall
arise during the construction of the Platform concerning
technical matters in respect of the materials and workmanship
covered by the ABS rules, such difference in opinion shall be
referred to ABS whose opinion thereof shall be final and
binding upon both parties.
(e) Within thirty (30) days of the date of this Agreement the
Builder shall deliver to the Owner a key event production
schedule (the "Production Schedule") showing planned
construction progress of the Platform. The Production
Schedule shall be reasonably acceptable to the Owner.
The Builder shall develop an overall Platform erection plan
that integrates material delivery and assembly actions
needed to schedule work flow during all phases of
construction. This plan shall encompass sufficient planning
data to assure that all phases of construction can be
adequately accomplished so as to deliver the Platform
on or before the Scheduled Delivery Date. The Platform
erection/construction plan shall be furnished to Owner
within sixty (60) days after the effective date of this
Agreement and shall, upon acceptance by Owner, become by
reference an integral part of the Production Schedule. The
Scheduled Delivery Date shall be extended by any delay
caused by act or omission of Owner, failure to timely deliver
to Builder any Owner Furnished Equipment, delays caused by
ABS or any governmental agency, changes made pursuant to
an approved change order, events of force majeure, or
inability of or failure or refusal of LeTourneau to fully and
timely perform all of its covenants, agreements, and
undertakings under the executed and delivered LeTourneau
Agreements or if all subjects and conditions under the
executed and delivered LeTourneau Agreements are not fully
and timely met. Timely updates and reports on the progress
of the Project Schedule shall be made as outlined in the
Specifications.
(f) Included in the Specifications is a list of tests and trials
to be performed by Builder in connection with the completion
of the Platform. Owner's Representative shall be given the
number of days of prior notice for each applicable test or
trial as set forth in the Specifications.
5. Changes and Additional Work.
(a) Owner shall have the right, at any time or times, to request
that reasonable change or changes be made in any of the
Specifications, and Owner shall issue to Builder a written
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change order to be executed by Owner and Builder;
provided, however, if such requested change or changes in
the aggregate would materially increase the overall scope
of work so as to adversely impact Builder's other work or
commitments or if LeTourneau refuses to agree to any
requested change with respect to the Package or the Equipment
or if Builder and Owner cannot reach agreement as to a
lump sum price or credit or change in the Scheduled Delivery
Date or other terms and conditions of this Agreement or
the Specifications, Builder shall have no obligation
to Owner to perform same. If any change necessitates an
increase or decrease in the quantity or quality of the
materials or the nature of the labor to be furnished by
Builder for the Platform, then the Contract Price shall be
increased or decreased on a lump sum basis in accordance
with the mutual agreement of the parties. Builder shall be
entitled to make minor changes to the Specifications, if
found necessary, for the introduction of improved production
methods or otherwise, subject to Owner's approval not
to be unreasonably withheld.
(b) If any such change will prolong the time for completion of the
Platform, the Scheduled Delivery Date provided hereunder shall
be extended accordingly.
6. Owner Furnished Equipment
(a) Within forty-five (45) days of the execution of this
Agreement, Builder shall furnish to Owner a schedule of vendor
certified drawing (VCD) delivery dates and in-yard delivery
dates of those items of material, equipment, engineering data
and information ("Owner Furnished Equipment"), as are set
forth in the Specifications to be provided by Owner. The time
for delivery of the Owner Furnished Equipment as detailed on
such delivery schedule shall be such so as to not cause
Builder to be delayed in the timely prosecution of the work in
accordance with the Production Schedule.
(b) Builder shall at its own cost install the Owner Furnished
Equipment. Builder's scope of work includes all necessary
foundations and supplies, such as, but not limited to,
electric power, air, fuel, steam, etc. All Owner Furnished
Equipment shall be delivered by Owner to Builder at Builder's
Yard in their assembled form, tested and in proper condition,
ready for installation in or on the Platform, in accordance
with the Production Schedule. Builder will assist Owner in
unloading all Owner Furnished Equipment. Suitable storage will
be provided by Builder for all Owner Furnished Equipment.
(c) In order to facilitate installation by Builder of the Owner
Furnished Equipment on the Platform, Owner shall furnish the
Builder with all necessary information including
specifications, plans, drawings, instruction books, manuals,
test reports and certificates. Owner, if so requested by
Builder, shall without any charge to Builder cause
representatives of the manufacturers of the Owner Furnished
Equipment to assist Builder in installation thereof in or on
the Platform and/or to carry out installation thereof by
themselves or to make necessary adjustments thereof at the
Yard. Builder's scope of work under this Agreement excludes
any testing, adjustment of equipment, repair and modification
and supply of all inter-connecting parts.
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(d) In the event of a delay in delivery of any Owner Furnished
Equipment, then Owner and Builder shall mutually agree on a
new installation date of the delayed Owner Furnished
Equipment. If no agreement is reached between both parties
within fifteen (15) days, then Builder shall have the right to
proceed with the construction of the Platform without
installation of the delayed Owner Furnished Equipment on the
Platform, without prejudice to Builder's other rights as
hereinabove provided, and Owner shall accept and take delivery
of Platform as so constructed.
(e) On delivery of each consignment of Owner Furnished Equipment,
Builder shall assist Owner in the inspection of the
consignment delivered. Any and all of the Owner Furnished
Equipment shall be subject to Builder's reasonable right of
rejection as and if they are found to be unsatisfactory or in
improper condition for installation. In such instances,
Builder shall first give adequate notice to Owner before being
entitled to reject the Owner Furnished Equipment.
(f) Should Owner fail to timely deliver the Owner Furnished
Equipment as provided in this Agreement and such delay results
in increased costs to Builder, Owner shall reimburse Builder
for such increased cost as and when incurred.
7. Liens
Provided Builder is paid all amounts owing to Builder by Owner under
this Agreement as and when due, Builder shall not place or create or
permit to be placed or created, any liens, charges, or encumbrances on,
or security interests as to, or pledges of, the Platform, including,
but not limited to, Owner Furnished Equipment, and any lien, charge,
encumbrance or security interest so placed or created by or through
Builder, its subcontractors and suppliers, or any of them, shall be
forthwith released by the Builder. The Builder shall release and cause
to be discharged any such lien, charge, encumbrance or security
interest. In the event Builder fails to secure the discharge or release
of any such lien, charge, encumbrance or security interest, after
notice to Builder the Owner may secure the removal of same, in which
event the Builder shall reimburse the Owner for its costs of securing
such discharge or release (which cost shall include any expenses
incurred in connection therewith) or at Owner's sole option by
deducting such sum from any payments due or to become due the Builder's
under this Agreement. In the event such cost is in excess of the amount
of any such reimbursement by deductions, the Builder further agrees to
pay the amount of such excess to the Owner upon demand.
8. Insurance
Builder shall obtain and maintain during all times hereunder the
following insurances:
(a) Worker's Compensation (including occupational disease), United
States Longshoremen and Harbor Workers, and employer's
liability insurance in accordance with the applicable
statutory requirements of the jurisdiction in which the
Platform is constructed, with maritime and in rem, alternate
employer, and voluntary compensation coverages, with limits on
9
the employer's liability coverage of not less than U.S.
$1,000,000 for bodily injury per person and with excess
liability limits of not less than U.S. $10,000,000 per
occurrence.
(b) Broad Form Comprehensive General Liability Insurance covering
all of the operations of Builder, including Contractual
Liability and Contractor's Protective Liability with a
combined single limit of not less than U.S. $1,000,000 per
occurrence for bodily injury and/or property damage, including
products and completed operations coverage, with excess
liability limits of not less than U.S. $10,000,000 per
occurrence.
(c) Each of the foregoing insurance policies shall, either
on the face thereof or by appropriate endorsement name
(except for the policies specified in subsection (a) above)
Owner as an additional assured with respect to the
indemnities of Builder assumed under this Agreement,
provide that the insurance policy shall not be cancelled or
coverage reduced except upon thirty (30) days prior
written notice to Owner, contain waivers of subrogation
pursuant to which the insurer waives all express or implied
rights of subrogation against Owner, provide that Owner
shall not be liable for premiums or calls, and be retained
in full force and effect by Builder until the completion
of the Platform hereunder as provided below. Builder
shall be responsible for all deductibles and self- insured
retentions, to the extent the loss or claim would otherwise
be covered by Builder's indemnities contained in this
Agreement. Concurrently with the execution of this Agreement,
Builder shall furnish to Owner certificates or other
evidence satisfactory to the other of the insurance required
hereunder.
(d) Until final delivery of the Platform, Builder shall its
own cost and expense, keep the Platform and all equipment
and materials either delivered to the Yard or being handled
by Builder for the Platform or built into, or installed
in or upon the Platform including, but not limited to, Owner
Furnished Equipment, fully insured under coverage and
with underwriters satisfactory to the Owner and not more
restrictive than the current form of London or American
Institute Clauses for Builder's Risks or equivalent form,
including tests and trials clauses. The Builder's Risks
insurance shall include supplemental coverage for war risks,
strikes, lockouts, labor disturbances, riot or civil
commotion, earthquakes, and protection and indemnity risks.
The amount of such insurance coverage shall be in an
amount at least equal to the Contract Price and shall be
increased from time to time to cover the cost of all
changes, alterations, or modifications.
(e) The Builder's Risks policy shall be taken out in the joint
names of Builder and Owner and all losses under such policy
shall be payable to the Builder and Owner in accordance with
their respective interests. The policies shall provide that
there shall be no recourse against the Owner for the payment
of premiums or other charges and shall further provide that at
least thirty (30) days' prior written notice of any material
alteration, cancellation, or cancellation for the non-payment
of premiums or other charges shall be given to the Owner by
the insurance underwriters. Any deductible under this
insurance policy shall be for the account of Builder.
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9. Title and Risk of Loss
(a) Title to the Platform, to the extent completed and all
equipment and materials destined for incorporation therein,
whether located at Builder's Yard or elsewhere, shall
immediately vest in Owner when the same is paid for by Owner,
whether prior to or after incorporation into the Platform;
provided, however, that title to the LeTourneau Kit
components shall vest in Owner only at such time as the
same are delivered by LeTourneau to Builder. The vesting of
title shall not relieve Builder of its obligation to
replace damaged or defective equipment and materials at
Builder's expense and to complete and deliver the
Platform in accordance with the provisions of this Agreement.
Risk of loss of the Platform shall pass to Owner upon
delivery and acceptance thereof in accordance with this
Agreement.
(b) To the extent that title to any part of the Platform or the
materials destined for incorporation in either platform
has passed from Builder to Owner or Owner otherwise obtains
any rights therein, whether now owned or hereafter
acquired, Owner as debtor hereby grants to Builder as a
secured party a security interest and lien upon same and all
right, title, and interest of Owner thereto and the
proceeds and products thereto, to secure the performance of
Owner under this Agreement and the payment to Builder of
all payments required to be paid by Owner to Builder under
this Agreement. In connection herewith, Builder shall upon
Owner's default under this Agreement have all rights and
remedies of a secured party under the Uniform Commercial
Code of Texas. The security interest and lien granted to
Builder hereunder and the rights and remedies of Builder
herein shall be deemed cumulative and in addition to the
rights and remedies otherwise available to Builder at law
or in equity or in contract, including without limitation
the rights of Builder under Article 2 of the Texas Uniform
Commercial Code.
(c) If the Platform or any Owner Furnished Equipment shall be
damaged by any insured cause whatsoever prior to acceptance
thereof by Owner and such damage does not constitute an actual
or a constructive total loss of the Platform, Builder and/or
Owner shall apply the amount recovered under the insurance
policy referred to in Section 8(d) of this Agreement to the
repair of such damage and Owner shall accept the Platform
under this Agreement if completed in accordance with this
Agreement and the Specifications. The Production Schedule
including the Scheduled Delivery Date shall be deemed extended
by the time necessary to repair such damage.
(d) In the event of an actual or constructive total loss of the
Platform prior to delivery, this Agreement shall automatically
be deemed terminated, and Builder shall retain all progress
payments made pursuant to Section 2(b) hereinabove and shall
be paid by Owner for the price for that portion of the
Platform then constructed for which progress payments have not
yet been made and all work in progress (including profit on
all to Builder). In the event that the actual or constructive
total loss of the Platform results from the operation of an
insurable risk covered by insurance as required under Section
8(d) of this Agreement, all of the proceeds of such insurance
payable as a result of such loss shall be paid to the Owner
and the Builder as their interests may appear.
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10. Delivery
(a) Upon completion of the construction of the Platform and
the tests and trials as provided in the Specifications,
Builder shall tender delivery of the Platform to Owner. Prior
to tendering delivery, Builder shall have remedied at
Builder's sole cost and expense any defects discovered by
Owner or Builder in Builder's workmanship or equipment and
materials including installation of Owner Furnished
Equipment or any other nonconformity of the Platform with the
requirements of the Specifications and performed any
retests necessary to ensure that such items have been fully
corrected. Owner shall accept such tender of delivery,
and Owner shall not have the right to refuse to accept
delivery of the Platform provided the same is substantially
completed and capable of being utilized by Owner. Any
remaining items shall be completed by Builder following
delivery and prior to departure of the Platform from
Builder's Yard, or Owner and Builder may mutually agree on
an appropriate reduction of the Contract Price for such
remaining items.
(b) On the Delivery Date, Owner shall pay to Builder all amounts
payable under this Agreement and Builder and Owner
shall execute and deliver a Protocol of Acceptance and
Delivery acknowledging delivery of the Platform. Builder
shall further deliver to Owner a Bill of Sale confirming the
conveyance of title to the Platform to the Owner, which
Bill of Sale shall (i) generally describe the Platform as
a mobile, self-contained and elevating platform, (ii)
contain a general warranty of title and freedom from liens
(except as to matters arising by, through, or under
Owner) in favor of the Owner, and (iii) be deemed to contain
the additional warranties and covenants set forth in
Section 11 hereinbelow without the necessity of making
any reference to such warranties in the Bill of Sale.
Builder shall also deliver to Owner the remaining delivery
documents set forth in the Specifications.
(c) Builder shall deliver the Platform along side Builder's dock
at the Yard. Following delivery, Owner shall have the right to
dock the Platform at Builder's Yard for a period not to exceed
fourteen (14) days, after which time the Platform must depart
from Builder's Yard. During such post-delivery docking period,
Owner shall pay to Builder its standard charges for shore
power, potable water, and security guard service. All such
charges must be paid by Owner to Builder prior to departure of
the Platform from Builder's Yard.
11. Warranty
Builder hereby warrants to Owner that (i) Builder's workmanship and
materials shall be free from material defects (except that with respect
to painting and coating Builder warrants only that same shall be
applied in accordance with the instructions of the supplier thereof),
(ii) that the Owner Furnished Equipment shall be installed in
accordance with the provisions of subpart (h) hereof, and (iii) to the
extent warranted by LeTourneau under the terms and conditions of the
executed and delivered Kit Construction Agreement that the components
of the Equipment manufactured by LeTourneau shall be free from material
12
defects in LeTourneau's workmanship and material and shall perform in
accordance with the executed and delivered Kit Construction Agreement
and the specifications attached thereto as Annex C in normal use and
service (any failure to meet the requirements of (i), (ii), or (iii)
being herein a "Warranty Deficiency"). The warranty set forth in the
preceding sentence (hereinafter referred to as the "Warranty") shall
commence on the date of delivery of the Platform to Owner and expire
twelve (12) months thereafter (provided, however, that the Warranty on
the Equipment manufactured by LeTourneau shall expire on the earlier to
occur of (i) thirty-six (36) months after the delivery of the item in
question to Builder by LeTourneau at LeTourneau's plant and (ii) twelve
(12) months after the date of delivery of the Platform; and provided,
further, that if any of the equipment of the Platform, including
without limitation any cranes or winches, is put into service prior to
said delivery, (i) Builder shall at its own cost and expense restore
such equipment to like new condition, and (ii) the twelve (12) months
warranty period shall commence with the commencement of such service or
operation insofar as such equipment is concerned) and shall be subject
to the following provisions:
(a) The Warranty shall not apply to any part of the Platform
which (i) has been misused, damaged due to negligence of
Owner or others, or structurally repaired or altered after
acceptance of the Platform by Owner by anyone other than
Builder or its duly authorized representative, or (ii) has
been damaged because of its use, or the use of any other
materials or equipment, after Owner (or any other person or
firm [excluding Builder] operating the Platform or its
equipment) has knowledge of such defect. Except for the
components of the Equipment manufactured by LeTourneau as
expressly set forth and as limited herein, equipment or
other components of the Platform sold to Owner pursuant to
this Agreement but not manufactured by Builder are not
warranted to any extent, but Builder shall assign (to the
extent same are assignable by Builder) to Owner, without
recourse, any warranties furnished to Builder by the
vendors of such equipment or other components. If any such
warranties are not assignable, Builder shall permit Owner
to seek performance or damages in Builder's name. Owner
shall seek performance or damages under such warranties only
from such parties and not from Builder. Builder shall use
reasonable efforts to secure the best available warranties
available from such vendors and shall cooperate with Owner
in any resulting dispute Owner may have with such vendors.
(b) The extent of Builder's liability for any breach of the
Warranty shall be limited to (i) repairing or replacing
(whichever of the two Builder, in its sole discretion,
shall elect) any material defects in Builder's workmanship or
materials, or causing the components of the Equipment
manufactured by LeTourneau to perform in accordance with the
executed and delivered Kit Construction Agreement
and the specifications thereto by repairing or replacing
(whichever of the two Builder, in its sole discretion,
shall elect) any material defects in LeTourneau's workmanship
or materials, as the case may be, at Builder's Yard or
at any other shipyard of Builder or its affiliates
(hereinafter referred to as an "Keppel Yard") or in the
case of the LeTourneau Equipment or workmanship and
materials at a shipyard of LeTourneau or one of its
affiliates (hereinafter referred to as a "LeTourneau Yard",
with the Platform to be brought to a Keppel Yard or a
13
LeTourneau Yard, as applicable, at Owner's sole risk and
expense, or (ii) reimbursing Owner for the cost of such
repair or replacement in accordance with the provisions of
subsection (c) hereinbelow.
(c) Owner, in the event of emergency, may elect to cause
the necessary repairs or replacements to be made at a
non-Keppel FELS Yard. In such event, Builder's sole
obligation shall be to reimburse Owner for the cost of such
repairs or replacements, provided, however, that in no
event shall the sum to be paid to Owner by Builder exceed the
cost that Builder would have borne, based on Builder's
normal rates, if the repairs or replacements had been made at
the Builder's Yard. If Owner elects to proceed under the
provisions of this subsection (c), Owner shall, as soon as
possible after such election (but in any event prior to the
commencement of such repairs or replacements), notify
Builder of the time, place, and estimated cost of such
repairs and replacements. Builder shall have the right to
verify, at its sole cost and expense, by its own
representative, the nature and extent of the defects
complained of prior to the time that the repairs or
replacements are made, and if in fact no breach of the
Warranty made by Builder herein has occurred, Owner shall
pay to Builder a per diem fee equal to Builders then current
labor rate schedule and the reasonable expenses incurred by
such representative.
(d) The REMEDIES provided in subsections (b) and (c) hereinabove
are EXCLUSIVE. Owner further agrees that in no event
will Builder's liability to Owner for breach of the
Warranty set forth in subsection (a) with respect to the
components of the Equipment manufactured by LeTourneau
exceed such amount as Builder may actually recover from
LeTourneau for the same breach of warranty under the
executed and delivered Kit Construction Agreement. The
Warranty shall not include transportation, towage,
insurance, or other incidental expenses. In no event shall
the obligation of Builder to repair or replace (or to
reimburse Owner pursuant to subsection (c) hereinabove for the
cost of repairing or replacing) defective workmanship
or materials be construed to require Builder to repair or
replace more than the actual workmanship or material that
is found to be defective. The Platform as a whole or any
other part thereof shall not be construed to be
"workmanship" or "material" for the purposes of the preceding
sentence and this Agreement, and in no event shall
Builder be required to repair or replace any portion or all of
the Platform damaged by a Warranty Deficiency.
(e) The Warranty shall not be effective unless Builder receives
from Owner a written notice of claimed the Warranty Deficiency
(i) within thirty (30) days after the date of discovery of
such Warranty Deficiency and (ii) prior to the expiration of
the prescribed Warranty period.
(f) Any work performed or materials furnished by Builder pursuant
to the Warranty shall be warranted for the remaining term of
the original Warranty, and nothing in subsection (b) or (c)
shall extend the Warranty period beyond the Warranty period
specified in this Section 11.
(g) THE WARRANTY AS DEFINED HEREINABOVE IS IN LIEU OF ALL
OTHER WARRANTIES (EXCEPT OF TITLE), EXPRESS OR IMPLIED,
STATUTORY OR AT COMMON LAW, AND ALL OTHER LIABILITIES (AT
14
COMMON LAW OR IN CONTRACT, TORT, OR OTHERWISE, RELATING IN
ANY WAY TO THE PLATFORM OR COMPONENTS THEREOF OR SERVICES
TO BE PROVIDED UNDER THIS AGREEMENT INCLUDING, WITHOUT
LIMITATION, STRICT LIABILITY AND NEGLIGENCE). WITHOUT
LIMITATION OF THE GENERALITY OF THE IMMEDIATELY PRECEDING
SENTENCE, BUILDER EXPRESSLY DISCLAIMS AND NEGATES (i) ANY
IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, (ii) ANY
IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, (iii) ANY IMPLIED OR EXPRESS WARRANTY OF
CONFORMITY TO MODELS OR SAMPLES (iv) ANY IMPLIED OR EXPRESS
WARRANTY OF DILIGENCE, (v) ANY IMPLIED OR EXPRESS
WARRANTY OF WORKMANLIKE SERVICE, (vi) ANY IMPLIED OR
EXPRESS WARRANTY OF SEAWORTHINESS, AND (vii) ALL OTHER
LIABILITY, AT COMMON LAW OR IN CONTRACT OR TORT OR OTHERWISE,
INCLUDING, WITHOUT LIMITATION, STRICT LIABILITY
(WHETHER FOUNDED IN SECTION 402(A) OF THE RESTATEMENT OF
TORTS OR OTHERWISE) AND NEGLIGENCE, WHETHER OCCASIONED BY
ACTS OR OMISSIONS OF SOLE OR CONCURRENT NEGLIGENCE OF BUILDER,
ITS AFFILIATES AND/OR OTHERS. BUILDER DISCLAIMS
LIABILITY FOR, AND IN NO EVENT WHATEVER SHALL BE LIABLE FOR,
ANY LOSS OF PROFITS OF OWNER OR OTHERS OR ANY OTHER
INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES.
(h) Builder's liability with respect to the Owner Furnished
Equipment shall extend only to installation thereof in
accordance with the certified equipment drawings furnished by
Owner in those instances where such Equipment is actually
installed by Builder. In all other instances (including,
without limitation, those instances in which Owner does not
furnish certified equipment drawings to Builder), the sole
risk and responsibility for the proper installation of the
Owner Furnished Equipment shall, as between Builder and Owner,
be borne by Owner. In all instances the sole risk and
responsibility for the operability of the Owner Furnished
Equipment shall, as between Builder and Owner, be borne by
Owner.
(i) No employee or representative of Builder is authorized to
change the Warranty in any way or to grant any other warranty.
(j) Owner understands and agrees that any modification to the
design of the Package or modification to the Equipment made by
the Owner are the responsibility of Owner and not the
responsibility of Builder for any purpose whatsoever,
including claims for damages or other liability asserted by
Owner, its customers or any third party. In the event such
modifications require class or regulatory approval, Owner
shall be responsible for obtaining such approval unless
Builder accepts the responsibility by executing a change order
to perform the work as additional work under this Agreement.
15
(k) Owner understands and agrees that the information contained
in the Package and relating to the Equipment do not
guarantee a fixed or variable weight of the Platform or
designate the use of equipment other than the Equipment. The
fixed and variable weight of the Platform and the selection
of equipment other than the Equipment are decisions of
the Owner, including outfitting and fabrication decisions.
The weight information provided by Builder is for
information only and reflects estimated and approximate
data only, and will be greatly affected by equipment
selections. Builder is unable to predict actual weights for
the Platform to be constructed by Builder. Builder does
not warrant or represent that Builder's sale or construction
of a Platform will meet the estimated or approximate
data supplied to Owner.
12. Indemnification Provisions
A. BUILDER INDEMNITIES
(A) BUILDER HEREBY AGREES TO RELEASE, DEFEND, INDEMNIFY AND HOLD
HARMLESS OWNER, ITS CUSTOMERS, AND THEIR RESPECTIVE
PARENT, HOLDING AND AFFILIATED COMPANIES, AND THEIR EMPLOYEES,
OFFICERS, DIRECTORS, AND AGENTS AND THE CONTRACTORS
AND SUBCONTRACTORS OF OWNER AND THEIR SERVANTS
(COLLECTIVELY THE "OWNER INDEMNITEES"), FROM AND AGAINST
ALL LIABILITIES, LOSSES, CLAIMS, DEMANDS OR CAUSES OF ACTION
(COLLECTIVELY "CLAIMS"), BY BUILDER OR ITS CONTRACTORS AND
SUBCONTRACTORS OF ANY TIER OR THEIR RESPECTIVE EMPLOYEES,
OFFICERS AND AGENTS, BASED ON ILLNESS, INJURY OR DEATH OR
DAMAGE OR DESTRUCTION OR LOSS OF USE OF PROPERTY THEREOF
INCLUDING WITHOUT LIMITATION THE YARD, OCCURRING PRIOR TO
THE DELIVERY TO AND ACCEPTANCE BY OWNER OF THE PLATFORM,
INCIDENT TO OR CONNECTED WITH OR ARISING OUT OF OR IN ANY
WAY RELATED DIRECTLY OR INDIRECTLY TO THE PERFORMANCE
OF THIS AGREEMENT OR BREACH HEREOF, REGARDLESS OF CAUSE,
INCLUDING THE SOLE OR CONCURRENT NEGLIGENCE OR FAULT OF ANY
OF BUILDER OR THE OWNER INDEMNITEES OR THEIR OFFICERS,
AGENTS, EMPLOYEES, OR SUBCONTRACTORS OF ANY TIER OR THEIR
EMPLOYEES OR AGENTS, UNSEAWORTHINESS, STRICT LIABILITY,
OR ANY OTHER EVENT OR CONDITION WHETHER OR NOT ANTICIPATED
BY ANY PERSON OR PARTY, REGARDLESS OF WHETHER PREEXISTING
THE EXECUTION OF THIS AGREEMENT.
(B) BUILDER SHALL BE LIABLE FOR ALL COSTS, EXPENSES, AND
REASONABLE ATTORNEYS FEES INCURRED BY OWNER INDEMNITEES IN
DEFENDING ANY COVERED CLAIMS AND IN ASSERTING THE INDEMNITIES
AS SET FORTH HEREIN AGAINST BUILDER. BUILDER SHALL BE
OBLIGATED TO BEAR THE EXPENSE OF THE INVESTIGATIONS AND
EXPENSES OF ALL CLAIMS ARISING THEREFROM AND TO PAY THE FULL
AMOUNT OF ANY JUDGMENT OR SETTLEMENT RENDERED AGAINST THE
16
OWNER INDEMNITEES, IT BEING STIPULATED THAT ALL OBLIGATIONS OF
INDEMNITY ASSUMED HEREIN SHALL SURVIVE THE TERMINATION OF THIS
AGREEMENT, REGARDLESS OF HOW SUCH TERMINATION IS EFFECTED. THE
OWNER INDEMNITEES SHALL PROVIDE REASONABLE ASSISTANCE TO
BUILDER IN RELATION TO THE DEFENSE OF CLAIMS WHICH ARE SUBJECT
TO INDEMNITY HEREUNDER.
B. OWNER INDEMNITIES
(A) OWNER HEREBY AGREES TO RELEASE, DEFEND, INDEMNIFY AND HOLD
HARMLESS BUILDER AND LETOURNEAU AND THEIR RESPECTIVE
PARENTS, HOLDING AND AFFILIATED COMPANIES, AND THEIR
RESPECTIVE EMPLOYEES, OFFICERS, DIRECTORS, AND AGENTS AND THE
CONTRACTORS AND SUBCONTRACTORS OF BUILDER AND LETOURNEAU AND
THEIR SERVANTS (COLLECTIVELY THE "BUILDER
INDEMNITEES"), FROM AND AGAINST ALL LIABILITIES, LOSSES,
CLAIMS, DEMANDS, COSTS, OR CAUSES OF ACTION (COLLECTIVELY
"CLAIMS"), BY OWNER OR ITS CONTRACTORS OR SUBCONTRACTORS
OF ANY TIER OR THEIR RESPECTIVE EMPLOYEES, OFFICERS AND
AGENTS, BASED ON ILLNESS, INJURY OR DEATH OR DAMAGE OR
DESTRUCTION OR LOSS OF USE OF PROPERTY OTHER THAN THE
PLATFORM, OCCURRING PRIOR TO THE DELIVERY TO AND ACCEPTANCE
BY OWNER OF THE PLATFORM, INCIDENT TO OR CONNECTED WITH
OR ARISING OUT OF OR IN ANY WAY RELATED DIRECTLY OR
INDIRECTLY TO THE PERFORMANCE OF THIS AGREEMENT OR BREACH
HEREOF, REGARDLESS OF CAUSE, INCLUDING THE SOLE OR
CONCURRENT NEGLIGENCE OR FAULT OF ANY OF OWNER OR THE BUILDER
INDEMNITEES OR THEIR OFFICERS, AGENTS, EMPLOYEES, OR
SUBCONTRACTORS OF ANY TIER OR THEIR EMPLOYEES OR AGENTS,
UNSEAWORTHINESS, STRICT LIABILITY OR ANY OTHER EVENT OR
CONDITION WHETHER OR NOT ANTICIPATED BY ANY PERSON OR
PARTY, REGARDLESS OF WHETHER PREEXISTING THE EXECUTION OF
THIS AGREEMENT.
(B) OWNER SHALL BE LIABLE FOR ALL COSTS, EXPENSES, AND REASONABLE
ATTORNEYS FEES INCURRED BY BUILDER INDEMNITEES IN DEFENDING
ANY COVERED CLAIMS AND IN ASSERTING THE INDEMNITIES AS SET
FORTH IN SUBSECTION (A) HEREINABOVE AGAINST OWNER. OWNER SHALL
BE OBLIGATED TO BEAR THE EXPENSE OF THE INVESTIGATIONS AND
EXPENSES OF ALL CLAIMS ARISING THEREFROM AND TO PAY THE FULL
AMOUNT OF ANY JUDGMENT OR SETTLEMENT RENDERED AGAINST THE
BUILDER INDEMNITEES, IT BEING STIPULATED THAT ALL OBLIGATIONS
OF INDEMNITY ASSUMED HEREIN SHALL SURVIVE THE TERMINATION OF
THIS AGREEMENT, REGARDLESS OF HOW SUCH TERMINATION IS
17
EFFECTED. THE BUILDER INDEMNITEES SHALL PROVIDE REASONABLE
ASSISTANCE TO OWNER IN RELATION TO THE DEFENSE OF CLAIMS WHICH
ARE SUBJECT TO INDEMNITY HEREUNDER.
C. AS USED HEREIN AND IN SECTIONS 14 AND 24 HEREINBELOW,
"AFFILIATES" OR "AFFILIATED COMPANIES" SHALL MEAN AN ENTITY
WHICH, DIRECTLY OR INDIRECTLY, THROUGH ONE OR MORE
INTERMEDIARIES, CONTROLS, IS CONTROLLED BY, OR IS UNDER COMMON
CONTROL WITH, THE PARTY IN QUESTION.
13. Patent Indemnity
(a) Builder hereby agrees to defend any claim or suit and to
indemnify and save Owner harmless from and against any damages
(including the costs of the suit and reasonable attorney's
fees) awarded against Owner in a suit arising out of any
infringement of any United States Letters Patent by reason of
the incorporation into the Platform in accordance with the
Package of any Equipment components manufactured by
LeTourneau; provided, however, that
(i) the indemnity contained in this Section 13 shall not apply to
any claim or suit arising out of the construction or use of
(1) processes, devices, apparatus, or equipment specified or
furnished by Owner or anyone else other than Builder, and
LeTourneau for which Owner shall indemnify and defend Builder,
and mounted upon or used in connection with the Platform; and
(2) any combination of and falling within subsection (i)(1)
herewith of the Equipment or the Platform; and
(ii) Owner shall give Builder prompt written notice of any such
claim or suit and shall permit Builder to control settlement
negotiations and any litigation in connection therewith;
provided, however, no settlement which purports to
acknowledge, on Owner's behalf the validity of the patent
involved shall be entered into by Builder without Owner's
consent. As to any Equipment components purchased by Builder,
Builder shall assign (to the extent same is assignable) to
Owner, without recourse, any patent indemnity coverage granted
to Builder by any vendor thereof. Owner shall seek performance
or damages under such warranties and Patent indemnities only
from such parties and not from Builder.
(b) Builder makes no representations and extends no warranties
that the manufacture, construction, or commercialization
of the Platform will not infringe the claims of any United
States or foreign Letters Patent that are not included in
Article II of the executed and delivered License Agreement,
and Builder specifically excludes any responsibility,
liability, or obligation to defend Owner or to hold harmless
and indemnify Owner against charges, claims, or suits
brought against Owner, its affiliates (an "affiliate"
of Owner being an entity which, directly or indirectly,
through one or more intermediaries, controls, is controlled
by, or is under common control with Owner), assigns,
successors, agents, employees, representatives,
18
subcontractors, or independent contractors for infringement
of any United States or foreign Letters Patent not included
in Article II of the executed and delivered License Agreement.
Owner further agrees that in no event shall Builder's
liability to indemnify and hold harmless Owner as provided
herein exceed such amount as Builder may actually recover
from LeTourneau for the same obligation to indemnify and
hold harmless under the executed and delivered License
Agreement.
(c) Owner agrees to defend any claim, suit, or proceeding
brought against Builder alleging that the construction or use
by Builder, pursuant to this Agreement, of any process,
method of construction, construction equipment, device, or
apparatus (including, without limitation, Owner Furnished
Equipment) specified or furnished by Owner or mounted upon
or used in connection with the Platform constitutes
infringement of any letters patent, and Owner agrees to
indemnify and save Builder harmless from and against any
judgment rendered against Builder as a result of such
claim, suit, or proceeding. Builder shall promptly notify
Owner in writing of any such claim, suit, or proceeding
and shall permit Owner to control the conduct and settlement
of such claim, suit, or proceeding, provided, however,
no settlement shall be entered into without Builder's
consent which purports to acknowledge on Builder's behalf the
validity of any patent. Builder shall provide information
and assistance to Owner, at Builder's expense, as may be
reasonably necessary to aid in the conduct and settlement
of the claim, suit, or proceeding. Builder shall be
entitled to participate, at its own expense, in the conduct
and settlement of such claim, suit, or proceeding
through its selected representatives and attorneys.
14. General Limitation of Liability
IN NO EVENT SHALL BUILDER OR LETOURNEAU OR THEIR AFFILIATES OR THE
AGENTS, OFFICERS, EMPLOYEES, INVITEES, OR REPRESENTATIVES OF BUILDER OR
ITS AFFILIATES OR THE SUBCONTRACTORS OF LETOURNEAU OR THEIR SERVANTS BE
LIABLE TO OWNER, ITS AGENTS, OFFICERS, EMPLOYEES, REPRESENTATIVES,
SUBCONTRACTORS, INDEPENDENT CONTRACTORS, OR AFFILIATES, OR TO ANY THIRD
PARTIES FOR ANY ECONOMIC LOSS, PHYSICAL HARM, INCIDENTAL,
CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES (INCLUDING, WITHOUT
LIMITATION, ANY LOSS OF, OR LOSS OF USE OF, THE EQUIPMENT OR THE
PLATFORM, LOSS OF BUSINESS OPPORTUNITIES, LOSS OF PROFITS OF BUYER OR
OTHERS OR ANY OTHER INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL
DAMAGES, ARISING OUT OF, RESULTING FROM OR RELATING IN ANY WAY TO THIS
AGREEMENT OR THE EXECUTED AND DELIVERED LETOURNEAU AGREEMENTS OR ANY
ACTIVITIES OR OMISSIONS OR DELAYS IN CONNECTION HEREWITH OR THEREWITH
INCLUDING, WITHOUT LIMITATION, THE PERFORMANCE (WHETHER TIMELY OR NOT)
OR THE NON-PERFORMANCE OF THIS AGREEMENT OR THE EXECUTED AND DELIVERED
LETOURNEAU AGREEMENTS, BREACH OF ANY WARRANTY, THE DESIGN OF THE
PLATFORM OR ANY PART THEREOF OR , OR THE LOSS OF OR LOSS OF USE OF THE
PLATFORM OR ANY PART THEREOF OR ANY OTHER EQUIPMENT, MATERIALS, OR
19
PROPERTY), REGARDLESS OF CAUSE AND REGARDLESS OF WHETHER BUILDER,
LETOURNEAU OR THEIR AFFILIATES, AND/OR THEIR RESPECTIVE OFFICERS,
EMPLOYEES, AGENTS, REPRESENTATIVES, CONTRACTORS, SUBCONTRACTORS, AND/OR
OTHERS MAY BE WHOLLY, PARTIALLY, OR SOLELY NEGLIGENT OR OTHERWISE AT
FAULT, UNSEAWORTHINESS, STRICT LIABILITY, OR ANY DEFECT IN PREMISES,
EQUIPMENT, OR MATERIALS, OR ANY OTHER EVENT OR CONDITION WHETHER OR NOT
ANTICIPATED BY ANY PERSON OR PARTY, REGARDLESS OF WHETHER PREEXISTING
THE EXECUTION OF THIS AGREEMENT.
IN NO EVENT SHALL OWNER OR ITS AFFILIATES OR THE AGENTS, OFFICERS,
EMPLOYEES, INVITEES, OR REPRESENTATIVES OF OWNER OR ITS AFFILIATES BE
LIABLE TO BUILDER, ITS AGENTS, OFFICERS, EMPLOYEES, REPRESENTATIVES,
SUBCONTRACTORS OR INDEPENDENT CONTRACTORS (NOT INCLUDING LETOURNEAU),
OR AFFILIATES, OR TO ANY THIRD PARTIES FOR ANY ECONOMIC LOSS, PHYSICAL
HARM, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES
(INCLUDING, WITHOUT LIMITATION, ANY LOSS OF, OR LOSS OF USE OF THE
SHIPYARD, LOSS OF BUSINESS OPPORTUNITIES, LOSS OF PROFITS OF BUILDER OR
OTHERS, OR ANY OTHER INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL
DAMAGES, ARISING OUT OF, RESULTING FROM OR RELATING IN ANY WAY TO THIS
AGREEMENT OR ANY ACTIVITIES OR OMISSIONS OR DELAYS IN CONNECTION
HEREWITH OR THEREWITH INCLUDING, WITHOUT LIMITATION, THE PERFORMANCE
(WHETHER TIMELY OR NOT) OR THE NON-PERFORMANCE OF THIS AGREEMENT,
REGARDLESS OF CAUSE AND REGARDLESS OF WHETHER OWNER OR ITS AFFILIATES,
AND/OR THEIR RESPECTIVE OFFICERS, EMPLOYEES, AGENTS, REPRESENTATIVES,
CONTRACTORS, SUBCONTRACTORS, AND/OR OTHERS MAY BE WHOLLY, PARTIALLY, OR
SOLELY NEGLIGENT OR OTHERWISE AT FAULT, UNSEAWORTHINESS, STRICT
LIABILITY, OR ANY DEFECT IN PREMISES, EQUIPMENT, OR MATERIALS, OR ANY
OTHER EVENT OR CONDITION WHETHER OR NOT ANTICIPATED BY ANY PERSON OR
PARTY, REGARDLESS OF WHETHER PREEXISTING THE EXECUTION OF THIS
AGREEMENT; PROVIDED, HOWEVER, NOTHING HEREIN SHALL BE DEEMED TO RELIEVE
OWNER OF THE OBLIGATION TO PAY TO BUILDER ALL AMOUNTS DUE OR OTHERWISE
PAYABLE UNDER THIS AGREEMENT, SUCH THAT BUILDER RECEIVES THE FULL
BENEFIT OF ITS BARGAIN REGARDLESS OF ANY BREACH OR FAILURE OF OWNER TO
PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT IN FULL.
15. Force Majeure
(a) For purposes of this Agreement, events of "force majeure"
shall be defined to mean all causes beyond the reasonable
control of the party asserting the benefit of this Section,
and shall include but not be limited to fire, explosion,
breakdown of machinery or equipment, shortage or
unavailability of materials or equipment, delay in
transportation, government order, edict, or other action,
storms, floods, abnormal weather that prevents blasting
or painting, strikes or other labor disturbances, destruction
or damage to Builder's Yard or equipment or any Owner
20
Furnished Equipment or the Platform or any part thereof
from any cause; acts of Owner or the classification society
or regulatory bodies having or purporting to have
jurisdiction including failure to give timely approvals; late
delivery of Owner Furnished Equipment or failure to furnish
in a timely manner necessary information concerning the
Owner Furnished Equipment or the performance of the work;
and any other causes or accidents of the same or similar
nature which are beyond the control of the Builder or Owner
or any or their respective subcontractors or suppliers.
In case either party shall be unable, wholly or in part,
because of any such event of force majeure to carry out its
obligations under this Agreement, the time for performance,
other than the obligation to make payments, shall be
extended by the period of such actual delay due to
force majeure for which notices are given as provided
hereinbelow. Performance of any obligations suspended while
any force majeure is operative shall be resumed as soon
as possible after such force majeure ceases. The party
seeking benefit of this Section shall notify the other of
the occurrence of each event of force majeure within seven
(7) days after commencement of such event. After ninety
(90) continuous days of delay in the construction of the
Platform due to force majeure, Builder and Owner shall each
have the right to terminate this Agreement without further
liability of either party to the other except that (1)
Builder shall retain all progress payments pursuant to
Section 2(b) hereinabove and shall be paid by Owner for the
price for that portion of the Platform then constructed
for which progress payments have not yet been made and all
work in process (including profit on all to Builder) and
(2) Builder shall (a) permit the Platform, work in process
and Owner Furnished Equipment to remain in Builder's
yard for a period of ninety (90) days following such
termination to permit the Owner time to dispose of such,
and (b) on a time and materials basis at Builder's
customary rates, perform such work on the Platform, work in
process or Owner Furnished Equipment as Owner reasonably
requires to facilitate such disposition. Owner shall pay to
Builder its standard charges for shore power, potable
water, and security guard service.
16. Independent Contractor
(a) Throughout the entire term of this Agreement, Builder shall be
an independent contractor with full power and authority to
select the means, methods and manner of performing its work
hereunder.
(b) All operations shall be conducted in Builder's own name and as
an independent contractor and not in the name of, or as an
agent for, Owner. In the event Builder shall sublet or
subcontract any of the construction of the Platform provided
for herein, Builder nevertheless shall remain primarily
responsible for compliance with all of the provisions hereof
and for the portion of the construction of the Platform
performed by the party to whom the work is sublet or
subcontracted, and Builder shall require such subcontractor
and such subcontractor's employees, agents and representatives
to comply with all the agreements, covenants, terms,
conditions, and provisions on the part of Builder to be
performed hereunder insofar as applicable to the work to be
performed by each party.
21
17. Default
A. Builder's Default
(a) Builder shall be in default of its obligations under this Agreement
if any of the following events occurs:
(i) The failure of the Builder to perform or breach of
any of the material covenants, agreements, or
undertakings on its part to be performed under this
Agreement, provided that the Owner shall give notice
to the Builder as to such failure and the Builder
shall not, within ten (10) days after being so
notified, commence and diligently prosecute to
completion remedial action to cure such failure to
perform or breach;
(ii) Builder goes into liquidation, whether voluntary or
compulsory, or enters into a scheme of arrangement,
or makes a general assignment of its assets for
the benefit of its creditors, or a receiver or
receivers of any kind whatsoever, whether temporary
or permanent, is appointed for the property of
Builder, or Builder institutes proceedings for its
reorganization or the institution of such
proceedings by creditors and approval thereof
by the court, whether proposed by a creditor,
a stockholder or any other person
whomsoever, or Builder suffers any execution
against a major portion of its assets which is not
satisfied within seven (7) days, or Builder fails
generally, or admits in writing its inability,
to pay its debts generally as they become due.
(b). If any default by Builder occurs as defined in subsection (a)
of this Section 17(A), Owner, at its election, may upon
prompt notice to Builder terminate this Agreement. Prior
to exercise of the remedies provided for hereinbelow, if
Builder disputes that it is in default, Owner shall first be
required to post with Builder a corporate surety bond from
a first class U.S. surety acceptable to Builder in a form
reasonably satisfactory to Builder. Such bond shall be in an
amount equal to 150% of any sum claimed by Builder under this
Agreement. Owner's sole and EXCLUSIVE remedies for any
such default shall be to terminate this Agreement, and upon
termination Owner shall immediately remove the Platform
from Builder's Yard in its then stage of construction and have
the Platform completed by others; provided, however, in
the event of a default under subsection 17A(a)(ii) (except
with respect to reorganization or temporary receivership),
the Builder shall upon the request of Owner put the
Platform and her equipment, materials and parts into such
condition, do such other things as will allow her/them to be
safely removed from the Builder's Yard, or to be worked on
in the Yard, as the Buyer may direct and commit all manpower
reasonably necessary from personnel physically present at
or employed or engaged by the Yard for this purpose and to
assist reasonably the towage, pilotage and departure of the
Platform. Upon termination, Owner shall be obligated to
pay Builder all sums due and owing Builder as of the date of
termination and a portion of the remaining milestones due
after the date of termination based on the percentage of work
22
performed before the date of termination with respect to such
remaining milestones; provided, however, Owner shall be
entitled to (a) an assignment of title by Builder, free and
clear of all liens, encumbrances and claims of any kind, in
and to the Platform, including all equipment, raw material,
goods and appurtenances purchased by Builder for
incorporation on or into the Platform, to the extent in each
case that Owner has paid for same, and (b) deduct from any
amounts due Builder any additional reasonable costs incurred
by Owner to complete the Platform (over and above the
balance of the Contract Price that Owner would have
reasonably expected to have paid had Builder completed the
Platform); provided, that Owner shall endeavor to mitigate
any such additional costs incurred to relocate and/or to
complete the Platform wherever possible; and provided further,
however, that in no event shall such additional costs as
referred to herein exceed, in aggregate, the sum of
US$7,500,000.00. Upon transfer of title, settlement and payment
of Builder's obligations as stated above, the parties'
liability recited herein shall be discharged.
B. Owner's Default
(a) Owner shall be in default of its obligations under this Agreement
if any of the following events occurs:
(i) In the event of failure by Owner to pay to Builder
any installments which are properly payable pursuant
to Section 2(b) hereinabove or the failure of the
Owner to perform or breach of any of the other
material covenants, agreements, or undertakings on
its part to be performed under this Agreement,
provided that the Builder shall give notice to the
Owner as to such failure and the Owner shall not,
within five (5) days in the case of failure to pay or
to take delivery of the Platform when completed under
the terms of this Agreement and thirty (30) days in
the case of other defaults after being so notified,
cure such failure to perform or breach;
(ii) Owner goes into liquidation, whether voluntary or
compulsory, or enters into a scheme of arrangement,
or makes a general assignment of its assets for the
benefit of its creditors, or a receiver or receivers
of any kind whatsoever, whether temporary or
permanent, is appointed for the property of Owner,
or Owner institutes proceedings for its
reorganization or the institution of such
proceedings by creditors and
approval thereof by the court, whether proposed
by a creditor, a stockholder or any other person
whomsoever, or Owner suffers any execution
against a major portion of its assets which is not
satisfied within seven (7) days, or Owner fails
generally, or admits in writing its inability, to
pay its debts generally as they become due.
(b). If any default by Owner occurs as defined in subsection (a) of
this Section 17(B), Builder, at its election, may upon prompt
notice to Owner suspend its performance under this Agreement
and at any time thereafter may terminate this Agreement
without prejudice and exercise all rights and remedies
available to Builder at law, in admiralty, or in equity.
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18. Litigation
(a) Owner and Builder agree that any legal suit, action, or
proceeding arising out of or relating to this Agreement may be
instituted only in a state or federal court in Cameron County,
Texas, United States of America.
(b) Owner hereby designates M&C Corporate Services Ltd., P.O. Box
309GT, Ugland House, South Church Street, George Town,
Grand Cayman, Cayman Islands ("M&C") who will accept service
via certified mail, return receipt requested as Owner's
authorized agent and acknowledges on its behalf service of
any and all process and, if through reasonable efforts,
service on M&C has been unsuccessful, Owner hereby designates
and appoints the Secretary of State, State of Texas,
as Owner's authorized agent to accept and acknowledge on
its behalf service of any and all process which may be
served in any such suit, action, or proceeding in any such
State or federal court in the State of Texas and agrees
that service of process upon said agent or the Assistant
Secretary of State or any clerk having charge of the
corporation department of the office of said Secretary of
State, at his office in Austin, Texas, and written notice
of said service to Owner, mailed or delivered to Owner at
the address specified for Owner in Article 19 of this
Agreement, shall be deemed in every respect effective
service of process upon Owner in any suit, action, or
proceeding and shall be taken and held to be valid personal
service upon Owner, whether or not Owner shall then be
doing, or at any time shall have done, business within
the State of Texas, and that any such service of process
shall be of the same force and validity as if service were
made upon it according to the laws governing the validity
and requirements of such service in such State, and waives
all claims of error by reason of any such service.
(c) Builder hereby designates and appoints C.Y. Ho, Keppel AmFELS,
Inc., Highway 48, Port of Brownsville, Brownsville,
Texas 78523 ("Ho") as Builder's authorized agent and
acknowledges on its behalf service of any and all process and,
if through reasonable efforts, service on Ho has been
unsuccessful, Builder hereby designates and appoints the
Secretary of State, State of Texas, as Builder's authorized
agent to accept and acknowledge on its behalf service of
any and all process which may be served in any such suit,
action, or proceeding in any such State or federal court
in the State of Texas and agrees that service of process
upon said agent or the Assistant Secretary of State or any
clerk having charge of the corporation department of the
office of said Secretary of State, at his office in Austin,
Texas, and written notice of said service to Builder,
mailed or delivered to Builder at the address specified for
Builder in Article 19 of this Agreement, shall be deemed in
every respect effective service of process upon Builder
in any suit, action, or proceeding and shall be taken and
held to be valid personal service upon Builder, whether or
not Builder shall then be doing, or at any time shall have
done, business within the State of Texas, and that any
such service of process shall be of the same force and
validity as if service were made upon it according to the
laws governing the validity and requirements of such service
in such State, and waives all claims of error by reason
of any such service.
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19. Notice
Any notice provided for under this Agreement must be given in writing,
but may be served by depositing same in the mail, addressed to the
party to be notified, postage paid, and registered or certified with
return receipt requested, or by delivering same in person to such other
party, or by pre-paid telegram, telex, facsimile confirmed by mail, or
cable. For purposes of notice, the addresses of the parties shall be:
If to Owner: Atwood Oceanics Pacific Limited
332A-11C, 11th Floor
Plaza Ampang City
Jalan Ampang
50450 Kuala Lumpur, Malaysia
Telephone: 011-603-4255-9714
Facsimile: 011-603-4257-9208
Attention: Mr. Tony Dyne
with a copy to
Atwood Oceanics, Inc.
15835 Park Ten Place Drive, Suite 200
Houston,Texas 77084
Telephone: ( 281 ) 749-7805
Facsimile: (281 ) 578-3253
Attention: Mr. Glen Kelley
If to Builder: Keppel AMFELS, Inc.
P.O. Box 3107
Highway 48
Port of Brownsville
Brownsville, Texas 78523
Telephone: (956) 831-8200
Facsimile: (956) 831-6220
Attention: C.Y. Ho
Provided, however, that each party shall have the continuing right to
change its address of notice at any time or times by the giving of ten
(10) days notice in the manner hereinabove described. Notices shall be
deemed given only upon receipt or by facsimile confirmation.
20. Successors and Assigns
This Agreement shall inure to the benefit of, and shall be binding
upon, the parties hereto, and their respective successors and assigns.
It is expressly understood and agreed that neither party shall assign
any of its rights, title and interest thereto without the prior written
consent of the other party; provided, however, that regardless of any
such assignment Owner shall remain primarily liable to Builder for the
performance of the obligations of Owner under this Agreement.
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21. Governing Law
This Agreement shall be deemed to have been made under, shall be
construed and interpreted in accordance with the laws of the State of
Texas, excluding any conflicts of law rule or law which might refer
such construction and interpretation to the laws of another state,
republic or country; provided, however, that all matters relating to
the interpretation of any patent or patent application will be decided
in accordance with the laws of the county which issued the patent to be
interpreted or in which the patent applications to be interpreted have
been filed.
22. Modification or Waiver
This Agreement, which incorporates all prior negotiations and
understandings relating to the subject matter thereof, sets forth the
entire agreement of the parties hereto, and supersedes all previous
negotiations, agreements, undertakings and representations, documents,
minutes of meetings, letters or notices (whether oral or written)
between the parties and/or their respective Affiliates with respect to
the subject matter. This agreement shall not be modified or waived
except by a written instrument executed by the duly authorized
representatives of Builder and Owner. The failure of either party to
insist upon strict performance of any provision hereof shall not
constitute a waiver of or estoppel against asserting the right to
require such performance in the future, nor shall a waiver or estoppel
in any one instance, constitute a waiver or estoppel with respect to a
later breach of a similar nature or otherwise. Each party agrees that
it does not enter into this Agreement or the Contract relying upon any
statement or representation or warranty (whether oral, written,
expressed or implied) except those expressly contained in this
Agreement.
23. Reliance
AS MORE FULLY SET FORTH IN OTHER PROVISIONS OF THIS AGREEMENT, BUILDER
AND OWNER HAVE REACHED EXPRESS AGREEMENT WITH RESPECT TO THE LIMITATION
OF THE LIABILITY OF THEIR RESPECTIVE LIABILITIES AND THE LIABILITIES OF
LETOURNEAU IN CONNECTION WITH THIS AGREEMENT AND THE WAIVER REFERRED TO
IN SECTION 24 HEREINBELOW. BUILDER AND OWNER EXPRESSLY RECOGNIZE THAT
(A) THE PRICE FOR WHICH BUILDER HAS AGREED TO PERFORM ITS OBLIGATIONS
UNDER THIS AGREEMENT HAS BEEN PREDICATED ON THE AFORESAID LIMITATION OF
LIABILITY AND WAIVER (IT BEING ACKNOWLEDGED THAT OWNER COULD HAVE
NEGOTIATED WITH BUILDER FOR MODIFICATIONS TO THE LIMITATION OF
BUILDER'S AND LETOURNEAU'S LIABILITY AND THE WAIVER BUT THAT THE PRICE
OF THE PLATFORM WOULD HAVE BEEN INCREASED TO REFLECT SUCH
MODIFICATIONS), AND (B) BUILDER, IN DETERMINING TO PROCEED WITH THE
PERFORMANCE OF ITS OBLIGATIONS PURSUANT TO THIS AGREEMENT, HAS
EXPRESSLY RELIED ON SUCH LIMITATION OF LIABILITY AND WAIVER AND WOULD
NOT HAVE EXECUTED THIS AGREEMENT BUT FOR SUCH LIMITATION OF LIABILITY
AND WAIVER.
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24. Waiver of Consumer Rights and Representations of Owner
OWNER HEREBY WAIVES THE SPECIAL RIGHTS AND PROTECTION PROVIDED BY THE
PROVISION OF THE TEXAS DECEPTIVE TRADE PRACTICE ACTS-CONSUMER
PROTECTION, CHAPTER 17, SUBCHAPTER E, SECTIONS 17.41 THROUGH 17.63,
INCLUSIVE (OTHER THAN SECTION 17.555 WHICH IS NOT WAIVED), VERNON'S
TEXAS CODES ANNOTATED, BUSINESS AND COMMERCE CODE. TO EVIDENCE ITS
ABILITY TO GRANT SUCH WAIVER, OWNER HEREBY REPRESENTS AND WARRANTS TO
BUILDER THAT OWNER (a) IS IN THE BUSINESS OF SEEKING OR ACQUIRING, BY
PURCHASE OR LEASE, GOODS OR SERVICES FOR COMMERCIAL OR BUSINESS USE AND
IS ACQUIRING THE GOODS AND SERVICES COVERED BY THIS AGREEMENT FOR
COMMERCIAL OR BUSINESS USE, (b) HAS ASSETS OF $5,000,000 OR MORE
ACCORDING TO ITS MOST RECENT FINANCIAL STATEMENT PREPARED IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPALS, (c) HAS KNOWLEDGE AND
EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT ENABLE IT TO EVALUATE
THE MERITS AND RISKS OF THE TRANSACTIONS CONTEMPLATED HEREBY, (d) IS
NOT IN A SIGNIFICANTLY DISPARATE BARGAINING POSITION; AND (e) IS
REPRESENTED BY LEGAL COUNSEL IN THIS TRANSACTION WHICH WAS NOT
IDENTIFIED, SUGGESTED OR SELECTED BY BUILDER. Owner's representations
and warranties shall survive the performance of all work in connection
with this Agreement and shall remain effective regardless of any
investigation at any time made by or on behalf of Builder or any
information Builder may have with respect thereto. Owner hereby agrees
to protect, indemnify, and hold Builder, LeTourneau, and their
respective Affiliates free and harmless from and against any and all
losses, costs (including, without limitation, the cost of the suit and
reasonable attorneys' fees), claims, causes of action, and liabilities
arising out or resulting from, or relating in any way to the breach of
the aforesaid representations and warranties.
25. Export Laws
In accordance with the Export Administration Regulations issued by the
United States Department of Commerce to enforce the Export
Administration Act of 1979, as amended from time to time, Owner hereby
gives written assurance to Builder that neither the Equipment nor the
direct product thereof (including, without limitation, the Platform)
nor any technical data is intended to be shipped, directly or
indirectly, to any country, person, or other entity contrary to any
laws, regulations or administrative orders of the United States or
other jurisdiction applicable to a transaction affecting this Agreement
and/or the executed and delivered LeTourneau Agreements. Owner further
acknowledges that Builder, in determining to execute this Agreement and
perform its obligations under this Agreement, has expressly relied on
the written assurance contained in the immediately preceding sentence.
27
26. Licenses
Notwithstanding anything in this Agreement to the contrary, it is
expressly understood that the obligations of Builder hereunder are
subject to and conditioned upon the timely issuance of all required
consents, approvals, rulings, licenses (including, without limitation,
export licenses and reexport licenses), and orders in form and
substance satisfactory to Builder from all agencies, governments, or
other bodies having or purporting to have jurisdiction or control over
any matters covered by or arising out of this Agreement or the executed
and delivered LeTourneau Agreements. Builder shall have no liability
(including, without limitation, any liability for damages, whether
special, incidental, consequential, or otherwise) if Builder is unable
to obtain, or is delayed in obtaining, any such required consent,
approval, ruling, license, or order.
27. Computation of Time
All periods of time shall be computed by including Saturdays, Sundays
and holidays except that if such period terminates on a Saturday,
Sunday or holiday it shall be deemed extended to the business day next
succeeding. All references in this Agreement to days shall mean
calendar days. Subject to the expressed provisions of this Agreement,
including without limitations Section 17, time is of the essence in
this Agreement.
28. Severability
This Agreement shall cease and terminate if for any reason any of the
terms and conditions of Sections 11(g) and 14 of this Agreement
(hereinafter collectively referred to as the "Limitation of Liability
Clauses") are held by any court of competent jurisdiction to contravene
or to be invalid under the laws of any political body having
jurisdiction over the subject matter hereof or thereof; provided,
however, that notwithstanding the termination of this Agreement,
Builder shall retain all progress payments then made and Owner shall be
obligated to pay to Builder the price for that portion of the Platform
then constructed for which progress payments have not yet been made and
all work in process (including profit on all to Builder) on or before
such termination. Owner and Builder agree not to take any action either
on their own behalf, or by way of providing assistance to or
cooperating with any third party for the purpose of invalidating any of
the Limitations of Liability Clauses. If any of the terms and
conditions of this Agreement other than the terms and conditions
referred to in this Section 28 are held by any court of competent
jurisdiction to contravene or to be invalid under the laws of any
political body having jurisdiction over the subject matter hereof, such
contravention or invalidity shall not invalidate the entire Agreement,
but, instead, this Agreement shall be construed as if not containing
the particular provision or provisions held to be invalid and the
rights and obligations of the parties shall be construed and enforced
accordingly and this Agreement shall thereupon and thereafter remain in
full force and effect.
29. Confidentiality and Ancillary Agreements
For and in consideration of the mutual covenants and
provisions hereof, Owner and Builder shall contemporaneously
with the execution of this Agreement execute and deliver to
the other a Confidentiality Agreement and Ancillary Agreement
in the forms attached hereto as Exhibits C and D.
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30. Construction
The parties to this Agreement having been represented by legal
counsel of their own choosing in connection with the
negotiation and drafting of this Agreement, this Agreement
shall be construed and interpreted for all purposes without
regard to the author of any specific language appearing
herein. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on
their behalf by their respective duly authorized representatives on the date
first shown above.
KEPPEL AmFELS, INC.
By:/s/ C.Y. Ho
Name: C.Y. Ho
Title: President/CEO
ATWOOD OCEANICS PACIFIC LIMITED
By:/s/ Richard Morgan
Name: Richard Morgan
Title: Director
29