FORM 20-F
|
o
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REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|
x
|
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
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Title of each class
|
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Name of each exchange on which registered
|
Common shares, $0.01 par value per share
|
|
New York Stock Exchange
|
Large accelerated filer
o
|
|
Accelerated filer
x
|
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Non-accelerated filer
o
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U.S. GAAP
x
|
|
International Financial Reporting Standards as issued
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Other
o
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|
|
by the International Accounting Standards Board
o
|
|
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Page
|
|
Page
|
ITEM 1.
|
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
|
ITEM 2.
|
OFFER STATISTICS AND EXPECTED TIMETABLE
|
ITEM 3.
|
KEY INFORMATION
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||||||
Statement of operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract drilling
|
$
|
1,085,063
|
|
|
$
|
1,085,794
|
|
|
$
|
745,574
|
|
|
$
|
638,050
|
|
|
$
|
65,431
|
|
Costs and expenses
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating expenses
|
(431,261
|
)
|
|
(459,617
|
)
|
|
(337,277
|
)
|
|
(331,495
|
)
|
|
(32,142
|
)
|
|||||
General and administrative expenses
|
(55,511
|
)
|
|
(57,662
|
)
|
|
(48,614
|
)
|
|
(45,386
|
)
|
|
(52,614
|
)
|
|||||
Depreciation expense
|
(243,457
|
)
|
|
(199,337
|
)
|
|
(149,465
|
)
|
|
(127,698
|
)
|
|
(11,619
|
)
|
|||||
|
(730,229
|
)
|
|
(716,616
|
)
|
|
(535,356
|
)
|
|
(504,579
|
)
|
|
(96,375
|
)
|
|||||
Loss from construction contract rescission
|
(40,155
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Loss of hire insurance recovery
|
—
|
|
|
—
|
|
|
—
|
|
|
23,671
|
|
|
18,500
|
|
|||||
Operating income (loss)
|
314,679
|
|
|
369,178
|
|
|
210,218
|
|
|
157,142
|
|
|
(12,444
|
)
|
|||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
||||||||||
Costs on interest rate swap termination
|
—
|
|
|
—
|
|
|
(38,184
|
)
|
|
—
|
|
|
—
|
|
|||||
Interest expense
|
(156,361
|
)
|
|
(130,130
|
)
|
|
(94,027
|
)
|
|
(104,685
|
)
|
|
(10,384
|
)
|
|||||
Total interest expense
|
(156,361
|
)
|
|
(130,130
|
)
|
|
(132,211
|
)
|
|
(104,685
|
)
|
|
(10,384
|
)
|
|||||
Costs on extinguishment of debt
|
—
|
|
|
—
|
|
|
(28,428
|
)
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings of Joint Venture
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,955
|
|
|||||
Interest income from Joint Venture
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|||||
Other income (expense)
|
(3,217
|
)
|
|
(5,171
|
)
|
|
(1,554
|
)
|
|
3,245
|
|
|
3,675
|
|
|||||
Income before income taxes
|
155,101
|
|
|
233,877
|
|
|
48,025
|
|
|
55,702
|
|
|
297
|
|
|||||
Income tax expense
|
(28,871
|
)
|
|
(45,620
|
)
|
|
(22,523
|
)
|
|
(21,713
|
)
|
|
(3,200
|
)
|
|||||
Net income (loss)
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
25,502
|
|
|
$
|
33,989
|
|
|
$
|
(2,903
|
)
|
Earnings (loss) per common share, basic
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
|
$
|
0.16
|
|
|
$
|
(0.01
|
)
|
Weighted-average number of common shares, basic
|
211,454
|
|
|
217,223
|
|
|
216,964
|
|
|
216,901
|
|
|
195,448
|
|
|||||
Earnings (loss) per common share, diluted
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
|
$
|
0.16
|
|
|
$
|
(0.01
|
)
|
Weighted-average number of common shares, diluted
|
211,557
|
|
|
217,376
|
|
|
217,421
|
|
|
216,903
|
|
|
195,448
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Years Ended December 31,
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Balance sheet data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
(1)
|
$
|
168,888
|
|
|
$
|
(21,425
|
)
|
|
$
|
301,471
|
|
|
$
|
522,390
|
|
|
$
|
115,462
|
|
Property and equipment, net
|
5,143,556
|
|
|
5,431,823
|
|
|
4,512,154
|
|
|
3,760,421
|
|
|
3,436,010
|
|
|||||
Total assets
|
5,832,478
|
|
|
6,077,301
|
|
|
5,164,040
|
|
|
4,893,928
|
|
|
4,184,289
|
|
|||||
Long-term debt
(2)
|
2,885,428
|
|
|
3,150,242
|
|
|
2,430,837
|
|
|
2,253,708
|
|
|
1,675,000
|
|
|||||
Shareholders’ equity
|
2,692,055
|
|
|
2,578,872
|
|
|
2,399,924
|
|
|
2,315,248
|
|
|
2,274,073
|
|
(1)
|
Working capital is defined as current assets minus current liabilities.
|
(2)
|
Includes current maturities of long-term debt.
|
ITEM 4.
|
INFORMATION ON THE COMPANY
|
•
|
Enhanced focus on safety and operational excellence
. In the current market with decreased demand for offshore drilling services, excelling in safety and operational ability is a key factor for success. Our management team is focused on providing quality drilling services for our existing clients by minimizing downtime and maximizing rig operational efficiency. We believe that we can develop a competitive advantage through our exceptional operating performance.
|
•
|
Efficiently manage costs while maintaining optionality and marketability
. We have implemented company-wide cost-savings initiatives and are continuously decreasing our rig operating expenses while effectively maintaining our ability to restart idle rigs within a three month time frame. The significant reduction in our operating costs has positioned us to be successful through the current market downturn.
|
•
|
Continued development of strategic relationships with high-quality clients
. Our future revenue is dependent upon major international and national oil companies as well as independent exploration and production companies resuming their exploration and development programs. Our existing and potential clients tend to take long-term approaches to the development of their projects, and we believe that our strong operational performance and efficient cost management will make us a preferred long-term partner.
|
•
|
The demand for our services depends on the level of activity in the offshore oil and natural gas industry, which is significantly affected by oil and natural gas prices and other factors beyond our control.
|
•
|
The price of oil may remain low for an extended period of time, or may decrease further, leading to lower capital expenditures by our clients over multiple years and rendering some previously anticipated deepwater projects uneconomic.
|
•
|
Our current backlog of contract drilling revenue may not be fully realized.
|
•
|
We may not be able to secure future drilling contracts or extensions to existing drilling contracts with new or existing clients on commercially favorable terms or at all or utilize the IMA to secure future drilling opportunities with Chevron.
|
•
|
An oversupply of rigs competing with our rigs has depressed the demand and contract prices for ultra-deepwater rigs, which could adversely affect our financial position, results of operations or cash flows.
|
•
|
We have a limited asset base and currently rely on two client accounts. The loss of any client or significant downtime on any drillship could adversely affect our financial position, results of operations or cash flows.
|
|
Years Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Chevron
|
81.2
|
%
|
|
67.4
|
%
|
|
55.6
|
%
|
Total
|
17.2
|
%
|
|
17.3
|
%
|
|
22.6
|
%
|
Petrobras
|
1.6
|
%
|
|
15.3
|
%
|
|
21.8
|
%
|
Rig
|
|
Contracted
Location
|
|
Client
|
|
Contract
Backlog
(a)
|
|
Contractual
Dayrate
(a)(b)
|
|
Average
Contract
Backlog
Revenue
Per Day
(a)
|
|
Contract
Commencement
|
|
Expected
Contract
Duration
|
||||||
Pacific Bora
|
|
Nigeria
|
|
Chevron
|
|
$
|
111,321
|
|
|
$
|
586
|
|
|
$
|
602
|
|
|
August 26, 2011
|
|
5 years
|
Pacific Scirocco
|
|
Nigeria
|
|
Total
|
|
$
|
162,311
|
|
|
$
|
499
|
|
|
$
|
499
|
|
|
December 31, 2011
|
|
5 years and 8 days
|
Pacific Santa Ana
|
|
U.S. Gulf of Mexico
|
|
Chevron
|
|
$
|
242,134
|
|
|
$
|
490
|
|
|
$
|
552
|
|
|
March 21, 2012
|
|
5 years and 38 days
|
Pacific Sharav
|
|
U.S. Gulf of Mexico
|
|
Chevron
|
|
$
|
783,005
|
|
|
$
|
558
|
|
|
$
|
611
|
|
|
August 27, 2014
|
|
5 years
|
(a)
|
In thousands. Based on signed drilling contracts and signed commitments as further described above.
|
(b)
|
Based on current contractual dayrate amounts, subject to any applicable escalation provisions.
|
Rig Name
|
|
Delivered
|
|
Water Depth(in feet)
|
|
Drilling Depth(in feet)
|
|
Customer
|
||
Pacific Bora
(a)
|
|
2010
|
|
10,000
|
|
|
37,500
|
|
|
Chevron
|
Pacific Scirocco
|
|
2011
|
|
12,000
|
|
|
40,000
|
|
|
Total
|
Pacific Santa Ana
|
|
2011
|
|
12,000
|
|
|
40,000
|
|
|
Chevron
|
Pacific Sharav
|
|
2014
|
|
12,000
|
|
|
40,000
|
|
|
Chevron
|
Pacific Mistral
|
|
2011
|
|
12,000
|
|
|
37,500
|
|
|
Available
|
Pacific Khamsin
|
|
2013
|
|
12,000
|
|
|
40,000
|
|
|
Available
|
Pacific Meltem
|
|
2014
|
|
12,000
|
|
|
40,000
|
|
|
Available
|
(a)
|
Maximum water depth could be extended to up to 12,000 feet with drillship modifications.
|
ITEM 4A.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 5.
|
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
•
|
market conditions, including the volatility of oil prices;
|
•
|
our clients’ reduced capital expenditure budgets;
|
•
|
the number of drillships in our fleet;
|
•
|
dayrates earned by our drillships;
|
•
|
utilization rates of drillships industry-wide;
|
•
|
operating expenses of our drillships;
|
•
|
administrative expenses;
|
•
|
interest and other financial items; and
|
•
|
tax expenses.
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||
|
2015
|
|
2014
|
|
Change
|
|
% Change
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||
Contract drilling
|
$
|
1,085,063
|
|
|
$
|
1,085,794
|
|
|
$
|
(731
|
)
|
|
—
|
%
|
Costs and expenses
|
|
|
|
|
|
|
|
|||||||
Operating expenses
|
(431,261
|
)
|
|
(459,617
|
)
|
|
28,356
|
|
|
6
|
%
|
|||
General and administrative expenses
|
(55,511
|
)
|
|
(57,662
|
)
|
|
2,151
|
|
|
4
|
%
|
|||
Depreciation expense
|
(243,457
|
)
|
|
(199,337
|
)
|
|
(44,120
|
)
|
|
22
|
%
|
|||
Loss from construction contract rescission
|
(40,155
|
)
|
|
—
|
|
|
(40,155
|
)
|
|
100
|
%
|
|||
Operating income
|
314,679
|
|
|
369,178
|
|
|
(54,499
|
)
|
|
15
|
%
|
|||
Other expense
|
|
|
|
|
|
|
|
|||||||
Interest expense
|
(156,361
|
)
|
|
(130,130
|
)
|
|
(26,231
|
)
|
|
20
|
%
|
|||
Other expense
|
(3,217
|
)
|
|
(5,171
|
)
|
|
1,954
|
|
|
38
|
%
|
|||
Income before income taxes
|
155,101
|
|
|
233,877
|
|
|
(78,776
|
)
|
|
34
|
%
|
|||
Income tax expense
|
(28,871
|
)
|
|
(45,620
|
)
|
|
16,749
|
|
|
37
|
%
|
|||
Net income
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
(62,027
|
)
|
|
33
|
%
|
|
Years Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Direct rig related operating expenses, net
|
$
|
345,504
|
|
|
$
|
346,475
|
|
Reimbursable costs
|
27,286
|
|
|
26,022
|
|
||
Shore-based and other support costs
|
32,520
|
|
|
35,947
|
|
||
Amortization of deferred costs
|
25,951
|
|
|
51,173
|
|
||
Total
|
$
|
431,261
|
|
|
$
|
459,617
|
|
|
Years Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands, amounts per
operating rig per day)
|
||||||
Direct rig related operating expenses, net
|
$
|
149.1
|
|
|
$
|
177.6
|
|
Shore-based and other support costs
|
14.0
|
|
|
18.4
|
|
||
Total
|
$
|
163.1
|
|
|
$
|
196.0
|
|
|
Years Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Interest
|
$
|
(183,800
|
)
|
|
$
|
(185,261
|
)
|
Realized losses on interest rate swaps
|
(9,643
|
)
|
|
(6,959
|
)
|
||
Capitalized interest
|
37,082
|
|
|
62,090
|
|
||
Interest expense
|
$
|
(156,361
|
)
|
|
$
|
(130,130
|
)
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||
|
2014
|
|
2013
|
|
Change
|
|
% Change
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||
Contract drilling
|
$
|
1,085,794
|
|
|
$
|
745,574
|
|
|
$
|
340,220
|
|
|
46
|
%
|
Costs and expenses
|
|
|
|
|
|
|
|
|||||||
Operating expenses
|
(459,617
|
)
|
|
(337,277
|
)
|
|
(122,340
|
)
|
|
36
|
%
|
|||
General and administrative expenses
|
(57,662
|
)
|
|
(48,614
|
)
|
|
(9,048
|
)
|
|
19
|
%
|
|||
Depreciation expense
|
(199,337
|
)
|
|
(149,465
|
)
|
|
(49,872
|
)
|
|
33
|
%
|
|||
Operating income
|
369,178
|
|
|
210,218
|
|
|
158,960
|
|
|
76
|
%
|
|||
Other expense
|
|
|
|
|
|
|
|
|||||||
Costs on interest rate swap termination
|
—
|
|
|
(38,184
|
)
|
|
38,184
|
|
|
100
|
%
|
|||
Interest expense
|
(130,130
|
)
|
|
(94,027
|
)
|
|
(36,103
|
)
|
|
38
|
%
|
|||
Total interest expense
|
(130,130
|
)
|
|
(132,211
|
)
|
|
2,081
|
|
|
2
|
%
|
|||
Costs on extinguishment of debt
|
—
|
|
|
(28,428
|
)
|
|
28,428
|
|
|
100
|
%
|
|||
Other expense
|
(5,171
|
)
|
|
(1,554
|
)
|
|
(3,617
|
)
|
|
233
|
%
|
|||
Income before income taxes
|
233,877
|
|
|
48,025
|
|
|
185,852
|
|
|
387
|
%
|
|||
Income tax expense
|
(45,620
|
)
|
|
(22,523
|
)
|
|
(23,097
|
)
|
|
103
|
%
|
|||
Net income
|
$
|
188,257
|
|
|
$
|
25,502
|
|
|
$
|
162,755
|
|
|
638
|
%
|
|
Years Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Direct rig related operating expenses, net
|
$
|
346,475
|
|
|
$
|
251,488
|
|
Reimbursable costs
|
26,022
|
|
|
20,918
|
|
||
Shore-based and other support costs
|
35,947
|
|
|
25,392
|
|
||
Amortization of deferred costs
|
51,173
|
|
|
39,479
|
|
||
Total
|
$
|
459,617
|
|
|
$
|
337,277
|
|
|
Years Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands, amounts per
operating rig per day)
|
||||||
Direct rig related operating expenses, net
|
$
|
177.6
|
|
|
$
|
170.6
|
|
Shore-based and other support costs
|
18.4
|
|
|
17.2
|
|
||
Total
|
$
|
196.0
|
|
|
$
|
187.8
|
|
|
Years Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Costs on interest rate swap termination
|
$
|
—
|
|
|
$
|
(38,184
|
)
|
Interest
|
(185,261
|
)
|
|
(161,443
|
)
|
||
Realized losses on interest rate swaps
|
(6,959
|
)
|
|
(11,105
|
)
|
||
Capitalized interest
|
62,090
|
|
|
78,521
|
|
||
Interest expense
|
$
|
(130,130
|
)
|
|
$
|
(132,211
|
)
|
|
Years Ended December 31,
|
|
|
||||||||
|
2015
|
|
2014
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
(62,027
|
)
|
Depreciation expense
|
243,457
|
|
|
199,337
|
|
|
44,120
|
|
|||
Amortization of deferred revenue
|
(86,276
|
)
|
|
(109,208
|
)
|
|
22,932
|
|
|||
Amortization of deferred costs
|
25,951
|
|
|
51,173
|
|
|
(25,222
|
)
|
|||
Amortization of deferred financing costs
|
11,278
|
|
|
10,416
|
|
|
862
|
|
|||
Amortization of debt discount
|
1,015
|
|
|
817
|
|
|
198
|
|
|||
Write-off of unamortized deferred financing costs
|
5,965
|
|
|
—
|
|
|
5,965
|
|
|||
Loss from construction contract rescission
|
38,084
|
|
|
—
|
|
|
38,084
|
|
|||
Deferred income taxes
|
9,840
|
|
|
18,661
|
|
|
(8,821
|
)
|
|||
Share-based compensation expense
|
12,534
|
|
|
10,484
|
|
|
2,050
|
|
|||
Changes in operating assets and liabilities, net
|
34,068
|
|
|
26,473
|
|
|
7,595
|
|
|||
Net cash provided by operating activities
|
$
|
422,146
|
|
|
$
|
396,410
|
|
|
$
|
25,736
|
|
|
Years Ended December 31,
|
|
|
||||||||
|
2015
|
|
2014
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
$
|
(181,458
|
)
|
|
$
|
(1,136,205
|
)
|
|
$
|
954,747
|
|
Net cash used in investing activities
|
$
|
(181,458
|
)
|
|
$
|
(1,136,205
|
)
|
|
$
|
954,747
|
|
|
Years Ended December 31,
|
|
|
||||||||
|
2015
|
|
2014
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from financing activities:
|
|
|
|
|
|
||||||
Net proceeds (payments) from shares issued under share-based compensation plan
|
$
|
(536
|
)
|
|
$
|
95
|
|
|
$
|
(631
|
)
|
Proceeds from long-term debt
|
315,000
|
|
|
760,000
|
|
|
(445,000
|
)
|
|||
Payments on long-term debt
|
(581,083
|
)
|
|
(41,833
|
)
|
|
(539,250
|
)
|
|||
Payments for financing costs
|
(4,070
|
)
|
|
(7,569
|
)
|
|
3,499
|
|
|||
Purchases of treasury shares
|
(21,760
|
)
|
|
(7,227
|
)
|
|
(14,533
|
)
|
|||
Net cash provided by (used in) financing activities
|
$
|
(292,449
|
)
|
|
$
|
703,466
|
|
|
$
|
(995,915
|
)
|
|
Years Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
188,257
|
|
|
$
|
25,502
|
|
|
$
|
162,755
|
|
Depreciation expense
|
199,337
|
|
|
149,465
|
|
|
49,872
|
|
|||
Amortization of deferred revenue
|
(109,208
|
)
|
|
(72,515
|
)
|
|
(36,693
|
)
|
|||
Amortization of deferred mobilization costs
|
51,173
|
|
|
39,479
|
|
|
11,694
|
|
|||
Amortization of deferred financing costs
|
10,416
|
|
|
10,106
|
|
|
310
|
|
|||
Amortization of debt discount
|
817
|
|
|
445
|
|
|
372
|
|
|||
Write-off of unamortized deferred financing costs
|
—
|
|
|
27,644
|
|
|
(27,644
|
)
|
|||
Costs on interest rate swap termination
|
—
|
|
|
38,184
|
|
|
(38,184
|
)
|
|||
Deferred income taxes
|
18,661
|
|
|
(3,119
|
)
|
|
21,780
|
|
|||
Share-based compensation expense
|
10,484
|
|
|
9,315
|
|
|
1,169
|
|
|||
Changes in operating assets and liabilities, net
|
26,473
|
|
|
6,081
|
|
|
20,392
|
|
|||
Net cash provided by operating activities
|
$
|
396,410
|
|
|
$
|
230,587
|
|
|
$
|
165,823
|
|
|
Years Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
$
|
(1,136,205
|
)
|
|
$
|
(876,142
|
)
|
|
$
|
(260,063
|
)
|
Decrease in restricted cash
|
—
|
|
|
172,184
|
|
|
(172,184
|
)
|
|||
Net cash used in investing activities
|
$
|
(1,136,205
|
)
|
|
$
|
(703,958
|
)
|
|
$
|
(432,247
|
)
|
|
Years Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Cash flow from financing activities:
|
|
|
|
|
|
||||||
Net proceeds (payments) from shares issued under share-based compensation plan
|
$
|
95
|
|
|
$
|
—
|
|
|
$
|
95
|
|
Proceeds from long-term debt
|
760,000
|
|
|
1,656,250
|
|
|
(896,250
|
)
|
|||
Payments on long-term debt
|
(41,833
|
)
|
|
(1,480,000
|
)
|
|
1,438,167
|
|
|||
Payments for costs on interest rate swap termination
|
—
|
|
|
(41,993
|
)
|
|
41,993
|
|
|||
Payments for financing costs
|
(7,569
|
)
|
|
(62,684
|
)
|
|
55,115
|
|
|||
Purchases of treasury shares
|
(7,227
|
)
|
|
—
|
|
|
(7,227
|
)
|
|||
Net cash provided by financing activities
|
$
|
703,466
|
|
|
$
|
71,573
|
|
|
$
|
631,893
|
|
Contractual Obligations
|
2016
|
|
2017-2018
|
|
2019-2020
|
|
Thereafter
|
|
Total
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Long-term debt
(a)
|
$
|
89,583
|
|
|
$
|
1,437,917
|
|
|
$
|
1,360,833
|
|
|
$
|
—
|
|
|
$
|
2,888,333
|
|
Interest on long-term debt
(b)
|
158,693
|
|
|
239,880
|
|
|
72,022
|
|
|
—
|
|
|
470,595
|
|
|||||
Operating leases
|
2,327
|
|
|
4,442
|
|
|
4,204
|
|
|
8,102
|
|
|
19,075
|
|
|||||
Purchase obligations
(c)
|
66,396
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,396
|
|
|||||
Total contractual obligations
(d)
|
$
|
316,999
|
|
|
$
|
1,682,239
|
|
|
$
|
1,437,059
|
|
|
$
|
8,102
|
|
|
$
|
3,444,399
|
|
(a)
|
Includes current maturities of long-term debt. Amounts are based on principal balances, excluding debt discounts.
|
(b)
|
Interest payments are based on our existing outstanding borrowings as of
December 31, 2015
. Amounts assume no refinancing of existing long-term debt and no prepayments. For fixed rate debt, interest has been calculated using stated rates. For variable rate LIBOR based debt, interest has been calculated using current LIBOR as of
December 31, 2015
and includes the impact of our outstanding interest rate swaps.
|
(c)
|
Purchase obligations are agreements to purchase goods and services that are enforceable and legally binding, that specify all significant terms, including the quantities to be purchased, price provisions and the approximate timing of the transactions, which includes our purchase orders for goods and services entered into in the normal course of business.
|
(d)
|
Contractual obligations do not include approximately
$27.4 million
of liabilities from unrecognized tax benefits related to uncertain tax positions, inclusive of interest and penalties, included on our consolidated balance sheet as of
|
ITEM 6.
|
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
Name
|
|
Age
|
|
Position
|
|
Christian J. Beckett
|
47
|
|
|
Chief Executive Officer
|
|
Paul T. Reese
|
46
|
|
|
Executive Vice President, Chief Financial Officer
|
|
Cees Van Diemen
|
62
|
|
|
Executive Vice President, Chief Operating Officer
|
|
Michael D. Acuff
|
45
|
|
|
Senior Vice President, Sales & Business Development
|
|
Lisa Manget Buchanan
|
55
|
|
|
Senior Vice President, General Counsel and Secretary
|
|
Richard E. Tatum
|
38
|
|
|
Vice President, Controller
|
Name
|
|
Age
|
|
Position
|
|
Ron Moskovitz
|
53
|
|
|
Chairman
|
|
Christian J. Beckett
|
47
|
|
|
Executive Director, Chief Executive Officer
|
|
Laurence N. Charney
|
68
|
|
|
Director
|
|
Jeremy Asher
|
57
|
|
|
Director
|
|
Sami Iskander
|
50
|
|
|
Director
|
|
Robert Schwed
|
66
|
|
|
Director
|
|
Paul Wolff
|
68
|
|
|
Director
|
|
Cyril Ducau
|
37
|
|
|
Director
|
|
Elias Sakellis
|
39
|
|
|
Director
|
•
|
a lump sum payment equal to the sum of: (i) an amount equal to six months, one year or two years (depending on the officer’s position) of the officer’s annual base salary in effect for the year of the date of termination, (ii) an amount equal to a pro-rated portion of the target bonus established for the officer for the year in which the termination occurs calculated through the date of termination, and (iii) an amount equal to the Company contributions that would be made for 12 months of benefits; and
|
•
|
automatic acceleration of the vesting of any stock options, restricted stock or restricted stock units that were granted to the officer that are scheduled to vest within one year following the date of termination.
|
•
|
a lump sum payment of (i) an amount equal to one, two or 2.99 times (depending on the officer’s position) the sum of: (A) the officer’s base salary in effect for the year of the date of termination, and (B) the target bonus established for the officer for the year in which the termination occurs, and (ii) an amount equal to the contributions that would be made for 12 or 24 months (depending on the officer’s position) of benefits; and
|
•
|
automatic acceleration of the vesting of all unvested stock options, restricted stock or restricted stock units that were granted to the officer.
|
•
|
972 employees and subcontractors in engineering and operations; and
|
•
|
216 employees and subcontractors in finance, strategy and business development, sales and marketing and other administrative functions.
|
•
|
36 employees and subcontractors in construction management;
|
•
|
1326 employees and subcontractors in engineering and operations; and
|
•
|
244 employees and subcontractors in finance, strategy and business development, sales and marketing and other administrative functions.
|
•
|
137 employees and subcontractors in construction management;
|
•
|
942 employees and subcontractors in engineering and operations; and
|
•
|
222 employees and subcontractors in finance, strategy and business development, sales and marketing and other administrative functions.
|
|
Beneficial Interest in
Common Shares
|
||||
Officer or Director
|
Number of
shares
(in thousands)
|
|
Percentage
|
||
Christian J. Beckett
|
2,660
|
|
|
1.3
|
%
|
Paul T. Reese
|
*
|
|
|
*
|
|
Cees Van Diemen
|
*
|
|
|
*
|
|
Michael D. Acuff
|
*
|
|
|
*
|
|
Lisa Manget Buchanan
|
*
|
|
|
*
|
|
Richard E. Tatum
|
*
|
|
|
*
|
|
Ron Moskovitz
|
—
|
|
|
—
|
|
Laurence N. Charney
|
*
|
|
|
*
|
|
Jeremy Asher
|
*
|
|
|
*
|
|
Sami Iskander
|
*
|
|
|
*
|
|
Robert Schwed
|
*
|
|
|
*
|
|
Paul Wolff
|
*
|
|
|
*
|
|
Cyril Ducau
|
—
|
|
|
—
|
|
Elias Sakellis
|
—
|
|
|
—
|
|
All officers and directors as a group
(a)
|
3,952
|
|
|
1.9
|
%
|
*
|
Less than 1%.
|
(a)
|
Includes 3.4 million of common shares issuable upon exercise of options that are exercisable within 60 days and 0.4 million restricted share units that vest within 60 days held by our senior management and directors as of February 23, 2016. The exercise prices of the stock options range from $2.17 to $10.80 per share.
|
ITEM 7.
|
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
|
Common Shares Held
|
||||
Identity of Person or Group
|
Number of
Shares
(in thousands)
|
|
Percentage
|
||
Quantum Pacific (Gibraltar) Limited
(1)
|
150,000
|
|
|
71.0
|
%
|
Adage Capital Partners, L.P.
|
14,604
|
|
(2)
|
6.9
|
%
|
(1)
|
Quantum Pacific (Gibraltar) Limited is a Gibraltar company and wholly-owned subsidiary of Quantum Pacific International Limited, the indirect ultimate owner of which is a discretionary trust in which Mr. Idan Ofer is the primary beneficiary. The address of Quantum Pacific (Gibraltar) Limited is 57/63 Line Wall Road, Gibraltar.
|
(2)
|
Based solely on a Schedule 13G/A filed with the Securities and Exchange Commission (“SEC”) on February 16, 2016, Adage Capital Partners, L.P. has shared voting power and shared dispositive power over 14,603,683 shares of our common shares. The address of Adage Capital Partners, L.P. is 200 Clarendon Street, 52nd Floor, Boston, MA 02116.
|
ITEM 8.
|
FINANCIAL INFORMATION
|
ITEM 9.
|
THE OFFER AND LISTING
|
|
Price Per Common Share
|
||||||||||
|
NYSE
|
|
NOTC
|
||||||||
|
High
(US$)
|
|
Low
(US$)
|
|
High
(NOK)
|
|
Low
(NOK)
|
||||
Fiscal Year Ended December 31,
|
|
|
|
|
|
|
|
||||
2015
|
5.61
|
|
|
0.84
|
|
|
n/a
|
|
|
n/a
|
|
2014
|
11.51
|
|
|
4.23
|
|
|
66.50
|
|
|
59.50
|
|
2013
|
12.25
|
|
|
8.89
|
|
|
67.60
|
|
|
49.00
|
|
2012
|
11.47
|
|
|
7.77
|
|
|
63.00
|
|
|
46.00
|
|
|
Price Per Common Share
|
||||||||||
|
NYSE
|
|
NOTC
|
||||||||
|
High
(US$)
|
|
Low
(US$)
|
|
High
(NOK)
|
|
Low
(NOK)
|
||||
Fiscal Year Ended December 31, 2015
|
|
|
|
|
|||||||
Fourth quarter
|
1.78
|
|
|
0.84
|
|
|
n/a
|
|
|
n/a
|
|
Third quarter
|
2.85
|
|
|
1.14
|
|
|
n/a
|
|
|
n/a
|
|
Second quarter
|
5.61
|
|
|
2.72
|
|
|
n/a
|
|
|
n/a
|
|
First quarter
|
4.70
|
|
|
3.12
|
|
|
n/a
|
|
|
n/a
|
|
Fiscal Year Ended December 31, 2014
|
|
|
|
|
|||||||
Fourth quarter
|
8.27
|
|
|
4.23
|
|
|
n/a
|
|
|
n/a
|
|
Third quarter
|
10.35
|
|
|
8.24
|
|
|
n/a
|
|
|
n/a
|
|
Second quarter
|
10.95
|
|
|
9.27
|
|
|
61.00
|
|
|
61.00
|
|
First quarter
|
11.51
|
|
|
9.59
|
|
|
66.50
|
|
|
59.50
|
|
(a)
|
February 1, 2016 through February 23, 2016.
|
(b)
|
No trading occurred on the NOTC for the six most recent months.
|
ITEM 10. ADDITIONAL INFORMATION
|
•
|
An individual who is a U.S. Holder of common shares (and who does not have a permanent establishment, a permanent representative or a fixed place of business in Luxembourg to which the common shares are attributable) will not be subject to Luxembourg taxation on capital gains arising upon disposal of such common shares pursuant to Article 14 (5) of the Treaty.
|
•
|
A corporate U.S. Holder, which has a permanent establishment, a permanent representative or a fixed place of business in Luxembourg to which our common shares are attributable, will be required to recognize capital gains (or losses as the case may be) on the sale of such common shares, which will be subject to Luxembourg corporate income tax and municipal business tax. However, gains realized on the sale of the common shares may benefit from the exemption provided for by Article 166 of the Luxembourg Income Tax and the Grand-Ducal Decree of December 21, 2001 (as amended) provided that at the time of the disposal of the common shares (a) the corporate U.S. Holder (acting through its permanent representative or fixed place of business in Luxembourg) of common shares holds a stake representing at least 10% of our total share capital or a cost price of at least 6,000,000 Euros (“€”) and (b) such qualifying shareholding has been held for an uninterrupted period of at least 12 months or the corporate U.S. Holder (acting through its permanent representative or fixed place of business in Luxembourg) undertakes to continue to own such qualifying shareholding until such time as the corporate U.S. Holder (acting through its permanent representative or fixed place of business in Luxembourg) has held our common shares for an uninterrupted period of at least 12 months. In certain circumstances, the exemption may not apply in part or in full; for example; the capital gains exemption (for gains arising on an alienation of the common shares) does not apply to the amount of previously tax deducted expenses and write-offs related to these common shares.
|
•
|
A corporate U.S. Holder, which has no permanent establishment in Luxembourg to which the common shares are attributable, will not be subject to Luxembourg taxation on capital gains arising upon disposal of such common shares pursuant to Article 14 (5) of the Treaty.
|
•
|
dealers in securities or currencies;
|
•
|
insurance companies;
|
•
|
regulated investment companies and real estate investment trusts;
|
•
|
tax-exempt organizations;
|
•
|
brokers or dealers in securities or currencies and traders in securities that elect to mark to market;
|
•
|
certain financial institutions;
|
•
|
partnerships or other pass-through entities and holders of interests therein;
|
•
|
holders whose functional currency for U.S. federal income tax purposes is not the U.S. dollar;
|
•
|
U.S. expatriates;
|
•
|
individual retirement accounts and other tax deferred accounts;
|
•
|
holders that acquired our common shares in compensatory transactions;
|
•
|
holders that hold our common shares as part of a hedge, straddle or conversion or other integrated transaction; or
|
•
|
holders that own, directly, indirectly, or constructively, 10% or more of the total combined voting power of the Company.
|
•
|
an individual who is a citizen or resident of the United States;
|
•
|
a corporation, or any other entity taxable as a corporation, created or organized in or under the laws of the United States or any State thereof, including the District of Columbia;
|
•
|
an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
|
•
|
a trust (a) if a court within the United States is able to exercise primary supervision over its administration and one or more United States persons (as defined in the Code) have the authority to control all of its substantial decisions or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.
|
•
|
the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the United States (and if required by an applicable income tax treaty, is also attributable to a permanent establishment that the Non-U.S. Holder maintains in the United States), in which case, the Non-U.S. Holder will generally be subject to regular graduated rates in the same manner as a U.S. Holder, and if the Non-U.S. Holder is a corporation, may be subject to a branch profits tax equal to 30% (or such lower rate provided by an applicable income tax treaty) of its effectively connected earnings and profits for the taxable year, subject to certain adjustments;
|
•
|
the Non-U.S. Holder is an individual who is present in the United States for 183 or more days in the taxable year of the sale, exchange or other taxable disposition and meets certain other requirements, in which case the gain generally will be subject to a flat 30% tax that may be offset by U.S. source capital losses (even though the Non-U.S. Holder is not considered a resident of the United States); or
|
•
|
the Non-U.S. Holder is subject to backup withholding, as discussed below.
|
ITEM 11.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 12.
|
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
ITEM 13.
|
DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
|
ITEM 14.
|
MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
|
ITEM 15.
|
CONTROLS AND PROCEDURES
|
ITEM 16.
|
RESERVED
|
ITEM 16A.
|
AUDIT COMMITTEE FINANCIAL EXPERT
|
ITEM 16B.
|
CODE OF ETHICS
|
ITEM 16C.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
|
Years ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(In thousands)
|
||||||
Audit fees
(a)
|
$
|
1,527
|
|
|
$
|
1,671
|
|
Audit-related fees
(b)
|
—
|
|
|
—
|
|
||
Tax fees
(c)
|
211
|
|
|
—
|
|
||
All other fees
(d)
|
—
|
|
|
—
|
|
||
Total
|
$
|
1,738
|
|
|
$
|
1,671
|
|
(a)
|
Audit fees represent professional services rendered for the audit of our annual consolidated financial statements and services provided by the principal accountant in connection with statutory and regulatory filings or engagements.
|
(b)
|
Audit-related fees consist of assurance and related services rendered by the principal accountant related to the performance of the audit or review of our consolidated financial statements, which have not been reported under audit fees above.
|
(c)
|
Tax fees represent fees for professional services rendered by the principal accountant for tax compliance, tax advice and tax planning.
|
(d)
|
All other fees include services other than audit fees, audit-related fees and tax fees set forth above.
|
ITEM 16D.
|
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
|
ITEM 16E.
|
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
|
Month in the year ended December 31, 2015
|
Total number of shares purchased
(a)
|
Average price paid per share ($)
(a)
|
Total number of shares purchased as part of publicly announced plans or programs
(b)(c)
|
Maximum number of shares that may yet be purchased under the plans or programs
(b)(c)
|
|||||
January
|
1,362,571
|
|
3.66
|
|
1,362,571
|
|
4,968,118
|
|
|
February
|
1,590,280
|
|
3.68
|
|
1,590,280
|
|
3,377,838
|
|
|
March
|
1,335,748
|
|
3.78
|
|
1,335,748
|
|
2,042,090
|
|
|
April
|
1,118,782
|
|
4.45
|
|
1,118,782
|
|
923,308
|
|
|
May
|
182,524
|
|
4.88
|
|
182,524
|
|
10,000,000
|
|
|
June
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
July
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
August
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
September
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
October
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
November
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
December
|
—
|
|
—
|
|
—
|
|
10,000,000
|
|
|
Total
|
5,589,905
|
|
$
|
3.88
|
|
5,589,905
|
|
10,000,000
|
|
ITEM 16F.
|
CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
|
ITEM 16G.
|
CORPORATE GOVERNANCE
|
ITEM 16H.
|
MINE SAFETY DISCLOSURE
|
ITEM 17.
|
FINANCIAL STATEMENTS
|
ITEM 18.
|
FINANCIAL STATEMENTS
|
Pacific Drilling S.A.
|
|
|
Consolidated Financial Statements
|
|
|
|
F-1
|
|
|
F-3
|
|
|
F-4
|
|
|
F-5
|
|
|
F-6
|
|
|
F-7
|
|
|
F-8
|
|
|
|
ITEM 19.
|
EXHIBITS
|
Exhibit
Number
|
|
Description
|
1.1*
|
|
Consolidated Articles of Association of Pacific Drilling S.A., dated March 6, 2014.
|
2.1
|
|
Registration Rights Agreement between Pacific Drilling S.A. and Quantum Pacific (Gibraltar) Limited, dated November 16, 2011 (incorporated by reference to Exhibit 2(a)(1) to our Annual Report on Form 20-F filed March 27, 2012, File No. 001-35345).
|
2.2
|
|
Bond Agreement, dated February 23, 2012, between Pacific Drilling S.A. and Norsk Tillitsmann ASA (incorporated by reference to Exhibit 2(b)(1) to our Annual Report on Form 20-F filed March 27, 2012, File No. 001-35345).
|
2.3
|
|
Indenture, dated as of November 28, 2012, among Pacific Drilling V Limited, as issuer, Pacific Drilling S.A., as parent guarantor, and each issuer subsidiary guarantor from time to time party thereto, as guarantors, and Deutsche Bank Trust Company Americas, as Trustee and Collateral Agent (incorporated by reference to Exhibit 99.1 to our Report on Form 6-K, filed December 5, 2012, File No. 001-35345).
|
2.4
|
|
Form of Note (incorporated by reference to Exhibit 99.2 to our Report on Form 6-K, filed December 5, 2012, File No. 001-35345).
|
2.5
|
|
Indenture, dated as of June 3, 2013, among Pacific Drilling S.A., the guarantors party thereto and Deutsche Bank Trust Company Americas, as Trustee (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed June 7, 2013, File No. 001-35345).
|
4.1
|
|
Intercreditor Agreement, dated as of June 3, 2013, by and among Citibank, N.A., as Pari Passu Collateral Agent for the Pari Passu Secured Parties, Citibank, N.A., as administrative agent for the Revolving Credit Agreement Secured Parties, Citibank, N.A., as administrative agent for the Term Loan Secured Parties, Deutsche Bank Trust Company Americas, as trustee under the Indenture, Pacific Drilling S.A. and each other Grantor and other party signatory thereto or that has executed a Joinder Consent Agreement (incorporated by reference to Exhibit 99.5 to the Report on Form 6-K, filed June 7, 2013, File No. 001-35345).
|
4.2
|
|
Term Loan Agreement, dated as of June 3, 2013, among Pacific Drilling S.A., as Borrower, Various Lenders and Citibank, N.A., as Administrative Agent, Citigroup Global Markets, Inc., Goldman Sachs Lending Partners LLC, Deutsche Bank Securities Inc. and Barclays Bank PLC, as Joint Lead Arrangers, Joint Bookrunners and Joint Syndication Agents and ABN AMRO Securities (USA) LLC, Credit Agricole Securities (USA) Inc., ING Financial Markets LLC, Nordea Bank Danmark A/S, Pareto Securities AS, RS Platou Markets AS, Scotia Capital (USA) Inc., Skandinaviska Enskilda Banken AB (Publ.), Standard Chartered Bank and NIBC Bank N.V., as Co-Documentation Agents and Co-Syndication Agents (incorporated by reference to Exhibit 99.3 to the Report on Form 6-K, filed June 7, 2013, File No. 001-35345).
|
4.3
|
|
Credit Agreement, dated as of June 3, 2013, among Pacific Drilling S.A., as Borrower, Various Lenders and Citibank, N.A., as Administrative Agent and Issuing Lender, Citigroup Global Markets Inc., Goldman Sachs Bank USA and Deutsche Bank Securities Inc., as Joint Lead Arrangers and Joint Bookrunners, Barclays Bank PLC, as Joint Bookrunners and Citigroup Global Markets Inc., as Syndication Agent (incorporated by reference to Exhibit 99.4 to the Report on Form 6-K, filed June 7, 2013, File No. 001-35345).
|
4.4
|
|
First Amendment to Credit Agreement, dated as of October 30, 2013, by and among Pacific Drilling S.A., as Borrower, the lenders party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 99.3 to the Report on Form 6-K, filed November 7, 2013, File No. 001-35345).
|
4.5
|
|
Second Amendment and Limited Waiver to Credit Agreement, dated as of March 28, 2014, by and among Pacific Drilling S.A., as Borrower, the lenders party thereto, and Citibank, N.A., as Administrative Agent, and solely for purposes of Section III thereof, Pacific Santa Ana(Gibraltar) Limited and Pacific Santa Ana S.à r.l. (incorporated by reference to Exhibit 99.2 to the Report on Form 6-K, filed April 3, 2014, File No. 001-35345).
|
4.6
|
|
Third Amendment to Credit Agreement, dated as of July 30, 2014, by and among Pacific Drilling S.A., as Borrower, the lenders party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed July 31, 2014, File No. 001-35345).
|
4.7
|
|
Fourth Amendment to Credit Agreement, dated as of March 2, 2015, by and among Pacific Drilling S.A., as Borrower, the lenders party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 99.2 to the Report on Form 6-K, filed March 16, 2015, File No. 001-35345).
|
4.8*
|
|
Fifth Amendment to Credit Agreement. dated as of November 5, 2015, by and among Pacific Drilling S.A., as Borrower, the lenders party thereto, and Citibank, N.A., as Administrative Agent.
|
4.9
|
|
Amendment No. 1 to Senior Secured Credit Facility Agreement, dated as of September 13, 2013 (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed November 7, 2013, File No. 001-35345).
|
4.10
|
|
Amended and Restated Senior Secured Credit Facility Agreement, dated as of September 13, 2013, among Pacific Sharav S.à r.l. and Pacific Drilling VII Limited, as Borrowers, Pacific Drilling S.A., as Guarantor, and the arrangers, lenders, agents and banks named therein (incorporated by reference to Exhibit 99.2 to the Report on Form 6-K, filed November 7, 2013, File No. 001-35345).
|
Exhibit
Number
|
|
Description
|
4.11
|
|
Amendment No. 2 to Senior Secured Credit Facility Agreement, dated as of March 27, 2014, among Pacific Sharav S.à r.l. and Pacific Drilling VII Limited, as Borrowers, Pacific Drilling S.A., as Guarantor, and the arrangers, lenders, agents and banks named therein (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed April 3, 2014, File No. 001-35345).
|
4.12
|
|
Amendment No. 3 to Senior Secured Credit Facility Agreement, dated as of August 14, 2014, among Pacific Sharav S.à r.l. and Pacific Drilling VII Limited, as Borrowers, Pacific Drilling S.A., as Guarantor, and the arrangers, lenders, agents and banks named therein (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed August 15, 2014, File No. 001-35345).
|
4.13
|
|
Amendment No. 4 to Senior Secured Credit Facility Agreement, dated as of March 2, 2015, among Pacific Sharav S.à r.l. and Pacific Drilling VII Limited, as Borrowers, Pacific Drilling S.A., as Guarantor, and the arrangers, lenders, agents and banks named therein (incorporated by reference to Exhibit 99.1 to the Report on Form 6-K, filed March 16, 2015, File No. 001-35345).
|
4.14*
|
|
Amendment No. 5 to Senior Secured Credit Facility Agreement, dated as of November 5, 2015, among Pacific Sharav S.à r.l. and Pacific Drilling VII Limited, as Borrowers, Pacific Drilling S.A., as Guarantor, and the arrangers, lenders, agents and banks named therein.
|
4.15
|
|
Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan, as amended and restated (incorporated by reference to Exhibit 4.2 to our Registration Statement on Form S-8, filed March 6, 2014, File No. 333-194380).
|
4.16
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Substitution of Stock Options and Stock Option Grant and Stock Option Agreement (incorporated by reference to Exhibit 4.3 to our Registration Statement on Form S-8, filed March 30, 2012, File No. 333-180485).
|
4.17
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Stock Option Grant and Stock Option Agreement (incorporated by reference to Exhibit 4.4 to our Registration Statement on Form S-8, filed March 30, 2012, File No. 333-180485).
|
4.18
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Restricted Stock Unit Grant and Restricted Stock Unit Agreement (incorporated by reference to Exhibit 4.5 to our Registration Statement on Form S-8, filed March 30, 2012, File No. 333-180485).
|
4.19
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Restricted Stock Unit Grant (Director Award) and Restricted Stock Unit Agreement (incorporated by reference to Exhibit 4.6 to our Registration Statement on Form S-8, filed March 6, 2014, File No. 333-194380).
|
4.20
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Restricted Stock Unit Grant (Executive Award) and Restricted Stock Unit Agreement (incorporated by reference to Exhibit 4.7 to our Registration Statement on Form S-8, filed March 6, 2014, File No. 333-194380).
|
4.21
|
|
Form of Pacific Drilling S.A. 2011 Omnibus Stock Incentive Plan Notice of Stock Option Grant (Executive Award) (incorporated by reference to Exhibit 4.9 to our Registration Statement on Form S-8, filed March 30, 2012, File No. 333-194380).
|
8.1*
|
|
Subsidiaries of Pacific Drilling S.A.
|
12.1*
|
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer.
|
12.2*
|
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer.
|
13.1**
|
|
Certificate of Chief Executive Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
|
13.2**
|
|
Certificate of Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
|
15.1*
|
|
Consent of Independent Registered Public Accounting Firm.
|
101.INS*
|
|
XBRL Instance Document.
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
|
|
|
|
|
|
|
|
|
|
|
PACIFIC DRILLING S.A.
|
||
|
|
|
|
|||
|
|
|
|
By:
|
|
/s/ Christian J. Beckett
|
|
|
|
|
Name:
|
|
Christian J. Beckett
|
|
|
|
|
Title:
|
|
Chief Executive Officer
|
Date: March 1, 2016
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Revenues
|
|
|
|
|
|
||||||
Contract drilling
|
$
|
1,085,063
|
|
|
$
|
1,085,794
|
|
|
$
|
745,574
|
|
Costs and expenses
|
|
|
|
|
|
||||||
Operating expenses
|
(431,261
|
)
|
|
(459,617
|
)
|
|
(337,277
|
)
|
|||
General and administrative expenses
|
(55,511
|
)
|
|
(57,662
|
)
|
|
(48,614
|
)
|
|||
Depreciation expense
|
(243,457
|
)
|
|
(199,337
|
)
|
|
(149,465
|
)
|
|||
|
(730,229
|
)
|
|
(716,616
|
)
|
|
(535,356
|
)
|
|||
Loss from construction contract rescission
|
(40,155
|
)
|
|
—
|
|
|
—
|
|
|||
Operating income
|
314,679
|
|
|
369,178
|
|
|
210,218
|
|
|||
Other expense
|
|
|
|
|
|
||||||
Costs on interest rate swap termination
|
—
|
|
|
—
|
|
|
(38,184
|
)
|
|||
Interest expense
|
(156,361
|
)
|
|
(130,130
|
)
|
|
(94,027
|
)
|
|||
Total interest expense
|
(156,361
|
)
|
|
(130,130
|
)
|
|
(132,211
|
)
|
|||
Costs on extinguishment of debt
|
—
|
|
|
—
|
|
|
(28,428
|
)
|
|||
Other expense
|
(3,217
|
)
|
|
(5,171
|
)
|
|
(1,554
|
)
|
|||
Income before income taxes
|
155,101
|
|
|
233,877
|
|
|
48,025
|
|
|||
Income tax expense
|
(28,871
|
)
|
|
(45,620
|
)
|
|
(22,523
|
)
|
|||
Net income
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
25,502
|
|
Earnings per common share, basic (Note 9)
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
Weighted-average number of common shares, basic (Note 9)
|
211,454
|
|
|
217,223
|
|
|
216,964
|
|
|||
Earnings per common share, diluted (Note 9)
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
Weighted-average number of common shares, diluted (Note 9)
|
211,557
|
|
|
217,376
|
|
|
217,421
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net income
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
25,502
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Unrecognized gain (loss) on derivative instruments
|
(14,889
|
)
|
|
(19,385
|
)
|
|
2,139
|
|
|||
Reclassification adjustment for loss on derivative instruments realized in net income (Note 10)
|
10,440
|
|
|
7,737
|
|
|
47,720
|
|
|||
Reclassification adjustment for loss on derivative instruments realized in property and equipment (Note 10)
|
1,164
|
|
|
—
|
|
|
—
|
|
|||
Total other comprehensive income (loss)
|
(3,285
|
)
|
|
(11,648
|
)
|
|
49,859
|
|
|||
Total comprehensive income
|
$
|
122,945
|
|
|
$
|
176,609
|
|
|
$
|
75,361
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
116,033
|
|
|
$
|
167,794
|
|
Accounts receivable
|
168,050
|
|
|
231,027
|
|
||
Materials and supplies
|
98,243
|
|
|
95,660
|
|
||
Deferred financing costs, current
|
14,636
|
|
|
14,665
|
|
||
Deferred costs, current
|
10,582
|
|
|
25,199
|
|
||
Prepaid expenses and other current assets
|
12,467
|
|
|
17,056
|
|
||
Total current assets
|
420,011
|
|
|
551,401
|
|
||
Property and equipment, net
|
5,143,556
|
|
|
5,431,823
|
|
||
Deferred financing costs
|
29,583
|
|
|
45,978
|
|
||
Long-term receivable
|
202,575
|
|
|
—
|
|
||
Other assets
|
36,753
|
|
|
48,099
|
|
||
Total assets
|
$
|
5,832,478
|
|
|
$
|
6,077,301
|
|
Liabilities and shareholders’ equity:
|
|
|
|
||||
Accounts payable
|
$
|
44,167
|
|
|
$
|
40,577
|
|
Accrued expenses
|
44,221
|
|
|
45,963
|
|
||
Long-term debt, current
|
89,583
|
|
|
369,000
|
|
||
Accrued interest
|
16,442
|
|
|
24,534
|
|
||
Derivative liabilities, current
|
7,483
|
|
|
8,648
|
|
||
Deferred revenue, current
|
49,227
|
|
|
84,104
|
|
||
Total current liabilities
|
251,123
|
|
|
572,826
|
|
||
Long-term debt, net of current maturities
|
2,795,845
|
|
|
2,781,242
|
|
||
Deferred revenue
|
60,639
|
|
|
108,812
|
|
||
Other long-term liabilities
|
32,816
|
|
|
35,549
|
|
||
Total long-term liabilities
|
2,889,300
|
|
|
2,925,603
|
|
||
Commitments and contingencies
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Common shares, $0.01 par value per share, 5,000,000 shares authorized, 232,770 shares issued and 211,207 and 215,784 shares outstanding as of December 31, 2015 and December 31, 2014, respectively
|
2,185
|
|
|
2,175
|
|
||
Additional paid-in capital
|
2,381,420
|
|
|
2,369,432
|
|
||
Treasury shares, at cost
|
(30,000
|
)
|
|
(8,240
|
)
|
||
Accumulated other comprehensive loss
|
(23,490
|
)
|
|
(20,205
|
)
|
||
Retained earnings
|
361,940
|
|
|
235,710
|
|
||
Total shareholders’ equity
|
2,692,055
|
|
|
2,578,872
|
|
||
Total liabilities and shareholders’ equity
|
$
|
5,832,478
|
|
|
$
|
6,077,301
|
|
|
Common Shares
|
|
Additional
Paid-In Capital |
|
Treasury Shares
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Total
Shareholders’
Equity
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
Shares
|
|
Amount
|
|||||||||||||||||||||
Balance at January 1, 2013
|
216,902
|
|
|
$
|
2,169
|
|
|
$
|
2,349,544
|
|
|
7,198
|
|
|
$
|
—
|
|
|
$
|
(58,416
|
)
|
|
$
|
21,951
|
|
|
$
|
2,315,248
|
|
Shares issued under share-based compensation plan
|
133
|
|
|
1
|
|
|
(1
|
)
|
|
(133
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
9,315
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,315
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49,859
|
|
|
—
|
|
|
49,859
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,502
|
|
|
25,502
|
|
||||||
Balance at December 31, 2013
|
217,035
|
|
|
2,170
|
|
|
2,358,858
|
|
|
7,065
|
|
|
—
|
|
|
(8,557
|
)
|
|
47,453
|
|
|
2,399,924
|
|
||||||
Shares issued under share-based compensation plan
|
418
|
|
|
5
|
|
|
90
|
|
|
(418
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
95
|
|
||||||
Issuance of common shares to treasury
|
—
|
|
|
—
|
|
|
—
|
|
|
8,670
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchased
|
(1,669
|
)
|
|
—
|
|
|
—
|
|
|
1,669
|
|
|
(8,240
|
)
|
|
—
|
|
|
—
|
|
|
(8,240
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
10,484
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,484
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,648
|
)
|
|
—
|
|
|
(11,648
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
188,257
|
|
|
188,257
|
|
||||||
Balance at December 31, 2014
|
215,784
|
|
|
2,175
|
|
|
2,369,432
|
|
|
16,986
|
|
|
(8,240
|
)
|
|
(20,205
|
)
|
|
235,710
|
|
|
2,578,872
|
|
||||||
Shares issued under share-based compensation plan
|
1,013
|
|
|
10
|
|
|
(546
|
)
|
|
(1,013
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(536
|
)
|
||||||
Shares repurchased
|
(5,590
|
)
|
|
—
|
|
|
—
|
|
|
5,590
|
|
|
(21,760
|
)
|
|
—
|
|
|
—
|
|
|
(21,760
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
12,534
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,534
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,285
|
)
|
|
—
|
|
|
(3,285
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
126,230
|
|
|
126,230
|
|
||||||
Balance at December 31, 2015
|
211,207
|
|
|
$
|
2,185
|
|
|
$
|
2,381,420
|
|
|
21,563
|
|
|
$
|
(30,000
|
)
|
|
$
|
(23,490
|
)
|
|
$
|
361,940
|
|
|
$
|
2,692,055
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flow from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
25,502
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation expense
|
243,457
|
|
|
199,337
|
|
|
149,465
|
|
|||
Amortization of deferred revenue
|
(86,276
|
)
|
|
(109,208
|
)
|
|
(72,515
|
)
|
|||
Amortization of deferred costs
|
25,951
|
|
|
51,173
|
|
|
39,479
|
|
|||
Amortization of deferred financing costs
|
11,278
|
|
|
10,416
|
|
|
10,106
|
|
|||
Amortization of debt discount
|
1,015
|
|
|
817
|
|
|
445
|
|
|||
Write-off of unamortized deferred financing costs
|
5,965
|
|
|
—
|
|
|
27,644
|
|
|||
Costs on interest rate swap termination
|
—
|
|
|
—
|
|
|
38,184
|
|
|||
Loss from construction contract rescission
|
38,084
|
|
|
—
|
|
|
—
|
|
|||
Deferred income taxes
|
9,840
|
|
|
18,661
|
|
|
(3,119
|
)
|
|||
Share-based compensation expense
|
12,534
|
|
|
10,484
|
|
|
9,315
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
62,977
|
|
|
(24,949
|
)
|
|
(53,779
|
)
|
|||
Materials and supplies
|
(2,583
|
)
|
|
(29,951
|
)
|
|
(16,083
|
)
|
|||
Prepaid expenses and other assets
|
(10,840
|
)
|
|
(56,493
|
)
|
|
(30,840
|
)
|
|||
Accounts payable and accrued expenses
|
(18,712
|
)
|
|
20,865
|
|
|
12,301
|
|
|||
Deferred revenue
|
3,226
|
|
|
117,001
|
|
|
94,482
|
|
|||
Net cash provided by operating activities
|
422,146
|
|
|
396,410
|
|
|
230,587
|
|
|||
Cash flow from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(181,458
|
)
|
|
(1,136,205
|
)
|
|
(876,142
|
)
|
|||
Decrease in restricted cash
|
—
|
|
|
—
|
|
|
172,184
|
|
|||
Net cash used in investing activities
|
(181,458
|
)
|
|
(1,136,205
|
)
|
|
(703,958
|
)
|
|||
Cash flow from financing activities:
|
|
|
|
|
|
||||||
Net proceeds (payments) from shares issued under share-based compensation plan
|
(536
|
)
|
|
95
|
|
|
—
|
|
|||
Proceeds from long-term debt
|
315,000
|
|
|
760,000
|
|
|
1,656,250
|
|
|||
Payments on long-term debt
|
(581,083
|
)
|
|
(41,833
|
)
|
|
(1,480,000
|
)
|
|||
Payments for costs on interest rate swap termination
|
—
|
|
|
—
|
|
|
(41,993
|
)
|
|||
Payments for financing costs
|
(4,070
|
)
|
|
(7,569
|
)
|
|
(62,684
|
)
|
|||
Purchases of treasury shares
|
(21,760
|
)
|
|
(7,227
|
)
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
(292,449
|
)
|
|
703,466
|
|
|
71,573
|
|
|||
Decrease in cash and cash equivalents
|
(51,761
|
)
|
|
(36,329
|
)
|
|
(401,798
|
)
|
|||
Cash and cash equivalents, beginning of period
|
167,794
|
|
|
204,123
|
|
|
605,921
|
|
|||
Cash and cash equivalents, end of period
|
$
|
116,033
|
|
|
$
|
167,794
|
|
|
$
|
204,123
|
|
|
Years
|
Drillships and related equipment
|
15-35
|
Other property and equipment
|
2-7
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Drillships and related equipment
|
$
|
5,856,564
|
|
|
$
|
5,907,226
|
|
Other property and equipment
|
14,938
|
|
|
10,353
|
|
||
Property and equipment, cost
|
5,871,502
|
|
|
5,917,579
|
|
||
Accumulated depreciation
|
(727,946
|
)
|
|
(485,756
|
)
|
||
Property and equipment, net
|
$
|
5,143,556
|
|
|
$
|
5,431,823
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Due within one year:
|
|
|
|
||||
2015 Senior Unsecured Bonds
|
$
|
—
|
|
|
$
|
286,500
|
|
2018 Senior Secured Term Loan B
|
7,500
|
|
|
7,500
|
|
||
Senior Secured Credit Facility
|
82,083
|
|
|
75,000
|
|
||
Total current debt
|
89,583
|
|
|
369,000
|
|
||
Long-term debt:
|
|
|
|
||||
2017 Senior Secured Bonds
|
498,887
|
|
|
498,369
|
|
||
2018 Senior Secured Term Loan B
|
721,958
|
|
|
728,706
|
|
||
2013 Revolving Credit Facility
|
50,000
|
|
|
—
|
|
||
Senior Secured Credit Facility
|
775,000
|
|
|
804,167
|
|
||
2020 Senior Secured Notes
|
750,000
|
|
|
750,000
|
|
||
Total long-term debt
|
2,795,845
|
|
|
2,781,242
|
|
||
Total debt
|
$
|
2,885,428
|
|
|
$
|
3,150,242
|
|
•
|
Consolidated Tangible Net Worth: maintain at least
$1.0 billion
consolidated tangible net worth.
|
•
|
Maximum Leverage Ratio: maintain a net debt to EBITDA ratio no greater than 4.75 to 1.00 as of December 31, 2015 and increasing incrementally to 6.00 to 1.00 during the period from July 1, 2016 through December 31, 2017, and 4.00 to 1.00, thereafter.
|
•
|
Total Debt to Capitalization Ratio: maintain a ratio of not greater than 3.0 to 5.0 of total debt to total capitalization.
|
•
|
Total Debt: maintain less than
$3.0 billion
in total debt.
|
•
|
Minimum Liquidity: maintain no less than
$50.0 million
in cash and cash equivalents.
|
•
|
Net Debt to Applicable Rigs ratio: maintain a net debt per rig ratio of not greater than
$425.0 million
through June 30, 2016 and decreasing incrementally to
$360.0 million
during the period from October 1, 2017 through December 31, 2017.
|
•
|
Maximum Leverage Ratio: maintain a net debt to EBITDA ratio no greater than 4.75 to 1.00 as of December 31, 2015 and increasing incrementally to 6.00 to 1.00 during the period from July 1, 2016 through December 31, 2017, and 4.25 to 1.00, thereafter.
|
•
|
Minimum Liquidity: maintain no less than
$100.0 million
in cash and cash equivalents (including undrawn capacity for borrowings under the 2013 Revolving Credit Facility).
|
•
|
Net Debt to Applicable Rigs ratio: maintain a net debt per rig ratio of not greater than
$425.0 million
through June 30, 2016 and decreasing incrementally to
$360.0 million
during the period from October 1, 2017 through December 31, 2017.
|
|
Years ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(in thousands)
|
||||||||||
Luxembourg
|
$
|
94,558
|
|
|
$
|
36,783
|
|
|
$
|
55,904
|
|
United States
|
4,812
|
|
|
3,631
|
|
|
206
|
|
|||
Other Jurisdictions
|
55,731
|
|
|
193,463
|
|
|
(8,085
|
)
|
|||
Total
|
$
|
155,101
|
|
|
$
|
233,877
|
|
|
$
|
48,025
|
|
|
Years ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(in thousands)
|
||||||||||
Current income tax expense:
|
|
|
|
|
|
||||||
Luxembourg
|
$
|
(1,107
|
)
|
|
$
|
(979
|
)
|
|
$
|
(816
|
)
|
United States
|
(2,347
|
)
|
|
(6,030
|
)
|
|
(1,885
|
)
|
|||
Other Foreign
|
(15,577
|
)
|
|
(19,950
|
)
|
|
(22,941
|
)
|
|||
Total current
|
$
|
(19,031
|
)
|
|
$
|
(26,959
|
)
|
|
$
|
(25,642
|
)
|
Deferred tax benefit (expense):
|
|
|
|
|
|
||||||
Luxembourg
|
$
|
(2,908
|
)
|
|
$
|
(1
|
)
|
|
$
|
(32
|
)
|
United States
|
(1,071
|
)
|
|
4,281
|
|
|
2,053
|
|
|||
Other Foreign
|
(5,861
|
)
|
|
(22,941
|
)
|
|
1,098
|
|
|||
Total deferred
|
$
|
(9,840
|
)
|
|
$
|
(18,661
|
)
|
|
$
|
3,119
|
|
Income tax expense
|
$
|
(28,871
|
)
|
|
$
|
(45,620
|
)
|
|
$
|
(22,523
|
)
|
|
Years ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Statutory rate
|
29.2
|
%
|
|
29.2
|
%
|
|
29.2
|
%
|
Effect of tax rates different than the Luxembourg statutory tax rate
|
(22.5
|
)%
|
|
(27.6
|
)%
|
|
25.2
|
%
|
Change in valuation allowance
|
10.6
|
%
|
|
10.2
|
%
|
|
(9.0
|
)%
|
Changes in unrecognized tax benefits
|
1.9
|
%
|
|
10.1
|
%
|
|
1.9
|
%
|
Equity based compensation shortfall
|
1.4
|
%
|
|
—
|
%
|
|
—
|
%
|
Adjustments related to prior years
|
(2.0
|
)%
|
|
(2.4
|
)%
|
|
(0.4
|
)%
|
Effective tax rate
|
18.6
|
%
|
|
19.5
|
%
|
|
46.9
|
%
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
40,422
|
|
|
$
|
33,537
|
|
Depreciation and amortization
|
62,702
|
|
|
54,815
|
|
||
Accrued payroll expenses
|
7,662
|
|
|
9,086
|
|
||
Deferred revenue
|
8,851
|
|
|
19,107
|
|
||
Other
|
2,025
|
|
|
1,187
|
|
||
Deferred tax assets
|
121,662
|
|
|
117,732
|
|
||
Less: valuation allowance
|
(94,422
|
)
|
|
(78,328
|
)
|
||
Total deferred tax assets
|
$
|
27,240
|
|
|
$
|
39,404
|
|
Deferred tax liabilities:
|
|
|
|
||||
Depreciation and amortization
|
$
|
(3,642
|
)
|
|
$
|
—
|
|
Deferred expenses
|
(12,483
|
)
|
|
(21,937
|
)
|
||
Other
|
(1,817
|
)
|
|
(1,220
|
)
|
||
Total deferred tax liabilities
|
$
|
(17,942
|
)
|
|
$
|
(23,157
|
)
|
Net deferred tax assets
|
$
|
9,298
|
|
|
$
|
16,247
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Balance, beginning of year
|
$
|
23,248
|
|
|
$
|
736
|
|
Increases in unrecognized tax benefits as a result of tax positions taken during prior years
|
1,327
|
|
|
3,473
|
|
||
Decreases in unrecognized tax benefits as a result of tax positions taken during prior years
|
(9,592
|
)
|
|
—
|
|
||
Increases in unrecognized tax benefits as a result of tax positions taken during current year
|
9,931
|
|
|
19,039
|
|
||
Balance, end of year
|
$
|
24,914
|
|
|
$
|
23,248
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(in thousands)
|
||||||||||
Operating expenses
|
$
|
4,650
|
|
|
$
|
3,131
|
|
|
$
|
2,087
|
|
General and administrative expenses
|
7,884
|
|
|
7,353
|
|
|
7,228
|
|
|||
Share-based compensation expense
|
12,534
|
|
|
10,484
|
|
|
9,315
|
|
|||
Tax benefit
(a)
|
(2,690
|
)
|
|
(2,154
|
)
|
|
(2,113
|
)
|
|||
Total
|
$
|
9,844
|
|
|
$
|
8,330
|
|
|
$
|
7,202
|
|
(a)
|
The effects of tax benefits from share-based compensation expense are included within income tax expense in our consolidated statements of income.
|
|
2015
Stock Options |
|
2014
Stock Options |
|
2013
Stock Options |
|||
Expected volatility
|
40.9
|
%
|
|
46.3
|
%
|
|
47.3
|
%
|
Expected term (in years)
|
6.25
|
|
|
6.25
|
|
|
6.25
|
|
Expected dividends
|
—
|
|
|
—
|
|
|
—
|
|
Risk-free interest rate
|
1.7
|
%
|
|
1.9
|
%
|
|
1.2
|
%
|
|
Number of Shares
Under Option
|
|
Weighted-Average
Exercise Price
|
|
Weighted-Average
Remaining
Contractual Term
|
|
Aggregate
Intrinsic
Value
|
|||||
|
(in thousands)
|
|
(per share)
|
|
(in years)
|
|
(in thousands)
|
|||||
Outstanding — January 1, 2015
|
5,029
|
|
|
$
|
10.00
|
|
|
|
|
|
||
Granted
|
2,729
|
|
|
3.51
|
|
|
|
|
|
|||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
|||
Cancelled or forfeited
|
(1,356
|
)
|
|
9.21
|
|
|
|
|
|
|||
Outstanding — December 31, 2015
|
6,402
|
|
|
$
|
7.40
|
|
|
7.7
|
|
$
|
—
|
|
Exercisable — December 31, 2015
|
2,824
|
|
|
$
|
9.98
|
|
|
5.7
|
|
$
|
—
|
|
|
Number of
Restricted Stock
Units
|
|
Weighted-Average
Grant-Date Fair
Value
|
|||
|
(in thousands)
|
|
(per share)
|
|||
Nonvested—January 1, 2015
|
1,767
|
|
|
$
|
9.99
|
|
Granted
|
2,393
|
|
|
3.64
|
|
|
Vested
|
(1,199
|
)
|
|
8.09
|
|
|
Cancelled or forfeited
|
(469
|
)
|
|
6.95
|
|
|
Nonvested—December 31, 2015
|
2,492
|
|
|
$
|
5.39
|
|
|
Years Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Numerator:
|
|
|
|
|
|
||||||
Net income, basic and diluted
|
$
|
126,230
|
|
|
$
|
188,257
|
|
|
$
|
25,502
|
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average number of common shares outstanding, basic
|
211,454
|
|
|
217,223
|
|
|
216,964
|
|
|||
Effect of share-based compensation awards
|
103
|
|
|
153
|
|
|
457
|
|
|||
Weighted-average number of common shares outstanding, diluted
|
211,557
|
|
|
217,376
|
|
|
217,421
|
|
|||
Earnings per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
Diluted
|
$
|
0.60
|
|
|
$
|
0.87
|
|
|
$
|
0.12
|
|
|
Years Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
|
(in thousands)
|
|||||||
Share-based compensation awards
|
8,891
|
|
|
6,196
|
|
|
5,817
|
|
Derivatives Designated as
Hedging Instruments
|
|
|
|
December 31,
|
||||||
|
Balance Sheet Location
|
|
2015
|
|
2014
|
|||||
|
|
|
|
(in thousands)
|
||||||
Long-term—Interest rate swaps
|
|
Other assets
|
|
$
|
—
|
|
|
$
|
5,601
|
|
Short-term—Interest rate swaps
|
|
Derivative liabilities, current
|
|
(5,899
|
)
|
|
(8,381
|
)
|
||
Long-term—Interest rate swaps
|
|
Other long-term liabilities
|
|
(238
|
)
|
|
—
|
|
||
Short-term—Foreign currency forward contracts
|
|
Derivative liabilities, current
|
|
(1,584
|
)
|
|
(267
|
)
|
||
Long-term—Foreign currency forward contracts
|
|
Other long-term liabilities
|
|
—
|
|
|
(296
|
)
|
||
Total
|
|
|
|
$
|
(7,721
|
)
|
|
$
|
(3,343
|
)
|
Derivatives in Cash Flow
Hedging Relationships
|
|
Gain (Loss) Recognized
in Other Comprehensive Income (“OCI”) for the Years Ended
December 31,
|
|
Loss Reclassified
from Accumulated OCI into
Income for the Years Ended
December 31,
|
|
Gain (Loss) Recognized in Income
(Ineffective Portion and Amount
Excluded from Effectiveness
Testing) for the Years ended
December 31,
|
||||||||||||||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||||||||||||||||||
Interest rate swaps
|
|
$
|
(1,701
|
)
|
|
$
|
(11,085
|
)
|
|
$
|
49,859
|
|
|
$
|
10,440
|
|
|
$
|
7,737
|
|
|
$
|
47,720
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
|
$
|
(1,584
|
)
|
|
$
|
(563
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(296
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
December 31,
|
||||||||||||||
|
2015
|
|
2014
|
||||||||||||
|
Carrying
Value
|
|
Estimated
Fair Value
|
|
Carrying
Value
|
|
Estimated
Fair Value
|
||||||||
|
(in thousands)
|
||||||||||||||
2015 Senior Unsecured Bonds
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
286,500
|
|
|
$
|
284,351
|
|
2017 Senior Secured Bonds
|
498,887
|
|
|
250,000
|
|
|
498,369
|
|
|
447,500
|
|
||||
2018 Senior Secured Term Loan B
|
729,458
|
|
|
307,125
|
|
|
736,206
|
|
|
614,551
|
|
||||
2020 Senior Secured Notes
|
750,000
|
|
|
322,500
|
|
|
750,000
|
|
|
600,000
|
|
|
December 31, 2015
|
||||||||||||
|
|
|
Fair Value Measurements Using
|
||||||||||
|
Carrying Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
(in thousands)
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
(6,137
|
)
|
|
—
|
|
|
$
|
(6,137
|
)
|
|
—
|
|
Foreign currency forward contracts
|
$
|
(1,584
|
)
|
|
—
|
|
|
$
|
(1,584
|
)
|
|
—
|
|
|
|
|
|
|
|
|
|
||||||
|
December 31, 2014
|
||||||||||||
|
|
|
Fair Value Measurements Using
|
||||||||||
|
Carrying Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
(in thousands)
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
5,601
|
|
|
—
|
|
|
$
|
5,601
|
|
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
(8,381
|
)
|
|
—
|
|
|
$
|
(8,381
|
)
|
|
—
|
|
Foreign currency forward contracts
|
$
|
(563
|
)
|
|
—
|
|
|
$
|
(563
|
)
|
|
—
|
|
|
|
||
|
(In thousands)
|
||
Years Ending December 31,
|
|
||
2016
|
$
|
2,327
|
|
2017
|
2,259
|
|
|
2018
|
2,183
|
|
|
2019
|
2,083
|
|
|
2020
|
2,121
|
|
|
Thereafter
|
8,102
|
|
|
Total future minimum lease payments
|
$
|
19,075
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Assets
|
$
|
17,612
|
|
|
$
|
18,349
|
|
Liabilities
|
(19,250
|
)
|
|
(10,559
|
)
|
||
Net carrying amount
|
$
|
(1,638
|
)
|
|
$
|
7,790
|
|
2.1.
|
The Company’s registered office is established in Luxembourg, Grand Duchy of Luxembourg. It may be transferred within that municipality by a resolution of the board of directors (the
Board
). It may be transferred to any other location in the Grand Duchy of Luxembourg by a resolution of the general meeting of shareholders (the
General Meeting
), acting in accordance with the conditions prescribed for the amendment of the Articles.
|
2.2.
|
Branches, subsidiaries or other offices may be established in the Grand Duchy of Luxembourg or abroad by a resolution of the Board. If the Board determines that extraordinary political or military developments or events have occurred or are imminent, and that those developments or events may interfere with the normal activities of the Company at its registered office, or with ease of communication between that office and persons abroad, the registered office may be temporarily transferred abroad until the developments or events in
|
3.1.
|
The Company’s object is the acquisition of participations, in Luxembourg or abroad, in any company or enterprise in any form whatsoever, and the management of those participations. The Company may in particular acquire, by subscription, purchase and exchange or in any other manner, any stock, shares and other participation securities, bonds, debentures, certificates of deposit and other debt instruments and, more generally, any securities and financial instruments issued by any public or private entity. It may participate in the creation, development, management and control of any company or enterprise. Further, it may invest in the acquisition and management of a portfolio of patents or other intellectual property rights of any nature or origin.
|
3.2.
|
The Company may borrow in any form. It may issue notes, bonds and any kind of debt and equity securities. It may lend funds, including, without limitation, the proceeds of any borrowings, to its subsidiaries, affiliated companies and any other companies. It may also give guarantees and pledge, transfer, encumber or otherwise create and grant security over some or all of its assets to guarantee its own obligations and those of any other company, and, generally, for its own benefit and that of any other company or person. For the avoidance of doubt, the Company may not carry out any regulated financial sector activities without having obtained the requisite authorisation.
|
3.3.
|
The Company may use any techniques, legal means and instruments to manage its investments efficiently and protect itself against credit risks, currency exchange exposure, interest rate risks and other risks.
|
3.4.
|
The Company may carry out any commercial, financial or industrial operation and any transaction with respect to real estate or movable property, which directly or indirectly, favours or relates to its corporate object.
|
4.1.
|
The Company is formed for an unlimited period.
|
4.2.
|
The Company is not to be dissolved by reason of the death, suspension of civil rights, incapacity, insolvency, bankruptcy or any similar event affecting one or more shareholders.
|
5.1.
|
The share capital is set at two million three hundred and twenty seven thousand seven hundred United States Dollars (USD 2,327,700) represented by two hundred thirty two million seven hundred seventy thousand (232,770,000) shares in registered form, without nominal value.
|
5.2.
|
The share capital may be increased or reduced once or more by a resolution of the General Meeting acting in accordance with the conditions prescribed for the amendment of the Articles.
|
5.3.
|
The Board is authorized, for a period of five (5) years from the date of the publication in the Luxembourg
Mémorial C, Recueil des Sociétés et Associations
of the minutes of the general meeting held on March 30, 2011, without prejudice to any renewals, to:
|
(i)
|
increase the current share capital once or more up to fifty million United States dollars (USD 50,000,000) (such amount including the current share capital of the Company) by the issue of new shares having the same rights as the existing shares, or without any such issue;
|
(ii)
|
determine the conditions of any such capital increase including through contributions in cash or in kind, by the incorporation of reserves, issue/share premiums or retained earnings, with or without issue of new shares to current shareholders or third parties (non-shareholders) or following the issue of any instrument convertible into shares or any other instrument carrying an entitlement to, or the right to subscribe for, shares;
|
(iii)
|
limit or withdraw the shareholders’ preferential subscription rights to the new shares, if any, and determine the persons who are authorized to subscribe to the new shares; and
|
(iv)
|
record each share capital increase by way of a notarial deed and amend the share register accordingly.
|
5.4.
|
Within the limits of article 5.3 of the Articles, the Board is expressly authorized to increase the Company’s share capital by incorporation of reserves, issue / share premiums or retained earnings and to issue the additional shares resulting from such capital increase to a beneficiary under any stock incentive plan as agreed by the Company, such beneficiary being a shareholder of the Company or not, or, to an entity appointed by the Company as an administrator in connection with such plan. The Company reserves the right to place transfer and other restrictions on such shares as determined by the Company pursuant to such stock incentive plan from time to time.
|
5.5.
|
When the Board has implemented an increase in capital as authorised by article 5.3, article 5 of the present articles of association shall be amended to reflect that increase.
|
5.6.
|
The Board is expressly authorised to delegate to any natural or legal person to organise the market in subscription rights, accept subscriptions, conversions or exchanges, receive
|
Art.6.
|
Shares
|
6.1.
|
The shares are and will remain in registered form (actions nominatives).
|
6.2.
|
A register of shares is kept at the registered office and may be examined by any shareholder on request.
|
6.3.
|
The shares may be entered without serial numbers into fungible securities accounts with financial institutions or other professional depositaries operating a settlement system in relation to transactions on securities, dividends, interest, matured capital or other matured monies of securities or of other financial instruments being handled through the system of such depositary (such systems, professionals or other depositaries being referred to hereinafter as
Depositaries
and each a
Depositary
). The shares held in deposit or in an account with such financial institution or professional depositary shall be recorded in an account opened in the name of the depositor and may be transferred from one account to another, whether such account is held by the same or a different financial institution or depositary. The Board may however impose transfer restrictions for shares that are registered, listed, quoted, dealt in, or have been placed in certain jurisdictions in compliance with the requirements applicable therein. The transfer to the register kept at the Company’s registered office may be requested by a shareholder.
|
6.4.
|
The Company may consider the person in whose name the registered shares are registered in the register(s) of Shareholders as the full owner of such registered shares. The Company shall be completely free from any responsibility in dealing with such registered shares towards third parties and shall be justified in considering any right, interest or claims of such third parties in or upon such registered shares to be non-existent, subject, however, to any right which such third party might have to demand the registration or change in registration of registered shares.
|
6.5.
|
Where the shares are held with Depositaries through fungible securities accounts within clearing and settlement systems, the exercise of the voting rights in respect of such shares may be subject to the internal rules and procedures of those clearing and settlement systems.
|
6.6.
|
All communications and notices to be given to a registered shareholder shall be deemed validly made to the latest address communicated by the shareholder to the Company. In the
|
6.7.
|
A share transfer of registered shares which are not held through fungible securities accounts is carried out by the entry in the register of shares of a declaration of transfer, duly signed and dated by both the transferor and the transferee or their authorized representatives, following a notification to or acceptance by the Company, in accordance with Article 1690 of the Civil Code. The Company may also accept other documents recording the agreement between the transferor and the transferee as evidence of a share transfer.
|
6.8.
|
The rights and obligations attached to any share shall pass to any transferee thereof.
|
6.9.
|
The shares are indivisible and the Company recognizes only one (1) owner per share.
|
6.10.
|
The Company may redeem its own shares using a method approved by the Board which is in accordance with Luxembourg law and the rules of any stock exchange(s) on which the shares in the Company are listed from time to time.
|
(i)
|
The Company is managed by the Board, which is composed of at least three (3) members (save as provided for in Article 8). The directors need not be shareholders.
|
(ii)
|
The Company is also bound towards third parties by the joint or single signature of any person to whom special signatory powers have been delegated, including, for the avoidance of doubt, the signature of any person to whom day-to-day management of the Company has been delegated in accordance with article 7.2(iii).
|
(iii)
|
Directors may be removed at any time, with or without cause, by a resolution of the General Meeting.
|
(iv)
|
If a legal entity is appointed as director, it must appoint a permanent representative to perform its duties. The permanent representative is subject to the same rules and incurs the same liabilities as if he had exercised its functions in its own name and on
|
(v)
|
Should the permanent representative be unable to perform its duties, the legal entity must immediately appoint another permanent representative.
|
(vi)
|
If the office of a director becomes vacant, the other directors, acting by a simple majority, may fill the vacancy on a provisional basis until a new director is appointed by the next General Meeting.
|
(i)
|
All powers not expressly reserved to the shareholder(s) by the Law or the Articles fall within the competence of the Board, which has full power to carry out and approve all acts and operations consistent with the Company’s corporate object.
|
(ii)
|
The Board may delegate special and limited powers to one or more agents for specific matters and may also establish committees for certain specific purposes. Such committees may include, but are not limited to, an audit committee and a compensation committee.
|
(iii)
|
The Board is authorised to delegate the day-to-day management, and the power to represent the Company in this respect, to one or more directors, officers, managers or other agents, whether shareholders or not, acting either individually or jointly. If the day-to-day management is delegated to one or more directors, the Board must report to the annual General Meeting any salary, fee and/or any other advantage granted to those director(s) during the relevant financial year.
|
(i)
|
The Board must appoint a chairperson from among its members, and may choose a secretary who need not be a director and who will be responsible for keeping the minutes of the meetings of the Board and of General Meetings.
|
(ii)
|
The Board meets at the request of the chairperson or the majority of the Board of directors, at the place indicated in the notice, which in principle is in Luxembourg.
|
(iii)
|
Written notice of any Board meeting is given to all directors at least twenty-four (24) hours in advance, except in the case of an emergency whose nature and circumstances are set forth in the notice.
|
(iv)
|
No notice is required if all members of the Board are present or represented and state that they know the agenda for the meeting. A director may also waive notice of a meeting, either before or after the meeting. Separate written notices are not required for meetings which
are held at times and places indicated in a schedule previously adopted by the Board.
|
(v)
|
A director may grant another director a power of attorney in order to be represented at any Board meeting.
|
(vi)
|
The Board may only validly deliberate and act if a majority of its members are present or represented. Board Resolutions are validly adopted if the majority of the members of the Board vote in their favour. The chairman has a casting vote in the event of a tie vote. Board resolutions are recorded in minutes signed by the chairperson, by all directors present or represented at the meeting, or by the secretary (if any).
|
(vii)
|
Any director may participate in any meeting of the Board by telephone or video conference, or by any other means of communication which allows all those taking part in the meeting to identify, hear and speak to each other. Participation by such means is deemed equivalent to participation in person at a duly convened and held meeting .
|
(viii)
|
Circular resolutions signed by all the directors (the
Directors’ Circular Resolutions
) are valid and binding as if passed at a duly convened and held Board meeting, and bear the date of the last signature.
|
(ix)
|
A director who has an interest in a transaction carried out other than in the ordinary course of business which conflicts with the interests of the Company must advise the Board accordingly and have the statement recorded in the minutes of the meeting. The director concerned may not take part in the deliberations concerning that transaction. A special report on the relevant transaction is submitted to the shareholders at the next General Meeting, before any vote on the matter.
|
(i)
|
The Company is bound towards third parties in all matters by the joint signature of the majority of the Board.
|
(ii)
|
The Company is also bound towards third parties by the joint or single signature of any person to whom special signatory powers have been delegated.
|
8.1.
|
Where the number of shareholders is reduced to one (1), the Company may be managed by a single director until the ordinary General Meeting following the introduction of an additional shareholder. In this case, any reference in the Articles to the Board or the directors should be read as a reference to that sole director, as appropriate.
|
8.2.
|
Transactions entered into by the Company which conflict with the interest of its sole director must be recorded in minutes. This does not apply to transactions carried out under normal circumstances in the ordinary course of business.
|
8.3.
|
The Company is bound towards third parties by the signature of the sole director or by the joint or single signature of any person to whom the sole director has delegated special signatory powers.
|
Art.9.
|
Liability of the directors
|
9.1.
|
The directors may not be held personally liable by reason of their mandate for any commitment they have validly made in the name of the Company’s name, provided those commitments comply with the Articles and the Law.
|
Art.10.
|
Directors’ Remuneration
|
10.1.
|
The remuneration of the board of directors will be decided by the General Meeting.
|
10.2.
|
The Company shall, to the fullest extent permitted by Luxembourg law, indemnify any director or officer, as well as any former director or officer, against any damages and/or compensation to be paid and any costs, charges and expenses, reasonably incurred by him in connection with the defense or settlement of any civil, criminal or administrative action, suit or proceeding to which he may be made a party by reason of his being or having been a director or officer of the Company, if (i) he acted honestly and in good faith, and (ii) in the case of criminal or administrative proceedings, he had reasonable grounds for believing that his conduct was lawful. Notwithstanding the foregoing, the current or former director or officer will not be entitled to indemnification in case of an action, suit or proceeding brought against him by the Company or in case he shall be finally adjudged in an action, suit or proceeding to be liable for gross negligence, wilful misconduct, fraud, dishonesty or any other criminal offence.
|
(i)
|
Resolutions of the shareholders are adopted at a general meeting of shareholders (the
General Meeting
). The General Meeting has full powers to adopt and ratify all acts and operations which are consistent with the company’s corporate object.
|
(ii)
|
Each share gives entitlement
to one (1) vote.
|
(i)
|
General Meetings are held at the time and place specified in the notices.
|
(ii)
|
The notices for any ordinary General Meeting or extraordinary General Meeting shall contain the agenda, the hour and the place of the meeting and shall be made by notices published twice (2) at least at eight (8) days interval and eight (8) days before the meeting in the Memorial C, Recueil des Sociétés et Associations (Luxembourg Official Gazette) and in a leading newspaper having general circulation in Luxembourg. In case the shares of the Company are listed on a foreign regulated market, the notices shall, in addition, (subject to applicable regulations) either (i) be published once in a leading newspaper having general circulation in the country of such listing at the same time as the first publication in Luxembourg or (ii) follow the market practices in such country regarding publicity of the convening of a general meeting of shareholders.
|
(iii)
|
If all the shareholders are present or represented and consider themselves duly convened and informed of the agenda, the General Meeting may be held without prior notice.
|
(iv)
|
A shareholder may grant written power of attorney to another person, shareholder or otherwise, in order to be represented at any General Meeting.
|
(v)
|
Any shareholder may participate in any General Meeting by telephone or video conference, or by any other means of communication which allows all those taking part in the meeting to identify, hear and speak to each other. Participation by such means is deemed equivalent to participation in person at the meeting.
|
(vi)
|
Any shareholder may vote by using the forms provided to that effect by the Company. Voting forms contain the date, place and agenda of the meeting and the text of the proposed resolutions. For each resolution, the form must contain three boxes allowing
|
(vii)
|
Resolutions of the General Meeting are passed by a simple majority vote, regardless of the proportion of share capital represented.
|
(viii)
|
An extraordinary General Meeting (Extraordinary General Meeting) may only amend the Articles if at least one-half of the share capital is represented and the agenda indicates the proposed amendments to the Articles, including the text of any proposed amendment to the Company’s object or form. If this quorum is not reached, a second Extraordinary General Meeting may be convened by means of notices published twice in the Mémorial and two Luxembourg newspapers, at an interval of at fifteen (15) days and fifteen (15) days before the meeting. These notices state the date and agenda of the Extraordinary General Meeting and the results of the previous Extraordinary General Meeting. The second Extraordinary General Meeting deliberates validly regardless of the proportion of capital represented. At both Extraordinary General Meetings, resolutions must be adopted by at least two-thirds of the votes cast.
|
(ix)
|
Any change in the nationality of the Company and any increase in a shareholder’s commitment in the Company require the unanimous consent of the shareholders and bondholders (if any).
|
Art.12.
|
Procedure
|
12.1.
|
General Meeting will be presided over by the chairman pro tempore appointed by the General Meeting. The General Meeting will appoint a scrutineer who shall keep the attendance list.
|
12.2.
|
The board of the General Meeting so constituted shall designate the secretary.
|
12.3.
|
Irrespective of the agenda, the Board may adjourn any ordinary General Meeting or Extraordinary General Meeting in accordance with the formalities and time limits stipulated for by law.
|
12.4.
|
Minutes of the General Meetings shall be signed by the members of the board of the meeting. Copies or excerpts of the minutes to be produced in court or elsewhere shall be signed by two (2) directors or by the secretary of the Board or by any assistant secretary.”
|
Art.13.
|
Sole shareholder
|
13.1.
|
When the number of shareholders is reduced to one (1), the sole shareholder exercises all powers granted by the Law to the General Meeting.
|
13.2.
|
Any reference to the General Meeting in the Articles is to be read as a reference to the sole shareholder, as appropriate.
|
13.3.
|
The resolutions of the sole shareholder are recorded in minutes.
|
Art.14.
|
Financial year and approval of annual accounts
|
14.1.
|
The financial year begins on 1 January and ends on 31 December of each year.
|
14.2
|
The Board prepares the balance sheet and profit and loss account annually, together with as an inventory stating the value of the Company’s assets and liabilities, with an annex summarising its commitments and the debts owed by its officers, directors and statutory auditors to the Company.
|
14.3
|
One month before the Annual General Meeting, the Board provides the statutory auditors with a report on and documentary evidence of the Company’s operations. The statutory auditors then prepare a report stating their findings and proposals.
|
14.4
|
The annual General Meeting is held at the registered office or in any other place within the municipality of the registered office, as specified in the notice, on the second Monday of May of each year at
10.00 a.m. If that day is not a business day in Luxembourg, the annual General Meeting is held on the following business day.
|
14.5
|
The annual General Meeting may be held abroad if, in the Board’s, absolute and final judgment, exceptional circumstances so require.
|
Art.15.
|
Auditors
|
15.1
|
The Company’s operations are supervised by one or more statutory auditors (
commissaires
).
|
15.2
|
When so required by law, or when the Company so chooses, the Company’s operations are supervised by one or more approved external auditors (
réviseurs d’entreprises agréés
).
|
15.3
|
The General Meeting appoints the statutory auditors (
commissaires
) / external auditors (
réviseurs d’entreprises agréés
), and determines their number and remuneration and the term of their mandate, which may not exceed six (6) years but may be renewed.
|
Art.16.
|
Allocation of profits
|
16.1
|
Five per cent (5%) of the Company’s annual net profits are allocated to the reserve required by law. This requirement ceases when the legal reserve reaches an amount equal to ten per cent (10%) of the share capital.
|
16.2
|
The General Meeting determines the allocation of the balance of the annual net profits. They may decide on the payment of a dividend, to transfer the balance to a reserve account, or to carry it forward in accordance with the applicable legal provisions.
|
16.3
|
Interim dividends may be distributed at any time, under the following conditions:
|
(i)
|
the Board draws up interim accounts;
|
(ii)
|
the interim accounts show that sufficient profits and other reserves (including share premiums) are available for distribution; it being understood that the amount to be distributed may not exceed the profits made since the end of the last financial year for which the annual accounts have been approved, if any, increased by profits carried forward and distributable reserves, and reduced by losses carried forward and sums to be allocated to the legal or a statutory reserve;
|
(iii)
|
the decision to distribute interim dividends is made by the Board within two (2) months from the date of the interim accounts.
|
16.4
|
The Company may make payment of dividends and any other payments in cash, shares or other securities to a Depositary. Said Depositary shall distribute these funds to his depositors according to the amount of securities or other financial instruments recorded in their name. Such payment by the Company to the Depositary will effect full discharge of the Company’s obligations in this regard.
|
Art.17.
|
|
17.1
|
The Company may be dissolved at any time by a resolution of the General Meeting, acting in accordance with the conditions prescribed for the amendment of the Articles. The General Meeting appoints one or more liquidators, who need not be shareholders, to carry out the liquidation, and determines their number, powers and remuneration. Unless otherwise decided by the General Meeting, the liquidators have full powers to realise the Company’s assets and pay its liabilities.
|
17.2
|
The surplus after realisation of the assets and payment of the liabilities is distributed to the shareholders in proportion to the shares held by each of them.
|
Art.18.
|
|
18.1
|
Notices and communications may be made or waived and circular resolutions may be evidenced in writing, fax, email or any other means of electronic communication.
|
18.2
|
Powers of attorney are granted by any of the means described above. Powers of attorney in connection with Board meetings may also be granted by a director, in accordance with such conditions as may be accepted by the Board.
|
18.3
|
Signatures may be in handwritten or electronic form, provided they fulfil all legal requirements for being deemed equivalent to handwritten signatures. Signatures of circular resolutions or resolutions adopted by telephone or video conference are affixed to one original or several counterparts of the same document, all of which taken together constitute one and the same document.
|
18.4
|
All matters not expressly governed by these Articles shall be determined in accordance with the applicable law and, subject to any non-waivable provisions of the law, with any agreement entered into by the shareholders from time to time.
|
I.
|
AMENDMENTS TO CREDIT AGREEMENT
.
|
Pricing Level
|
Leverage Ratio
|
Eurodollar +
|
Base Rate +
|
Commitment Fee
|
I
|
Less than 4.00 to 1.00
|
3.25%
|
2.25%
|
1.30%
|
II
|
Greater than or equal to 4.00 to 1.00
|
3.75%
|
2.75%
|
1.50%
|
Pricing Level
|
Leverage Ratio
|
Eurodollar +
|
Base Rate +
|
Commitment Fee
|
I
|
Less than 2.50 to 1.00
|
2.50%
|
1.50%
|
0.70%
|
II
|
Greater than or equal to 2.50 to 1.00, but less than 3.50 to 1.00
|
2.75%
|
1.75%
|
0.80%
|
III
|
Greater than or equal to 3.50 to 1.00, but less than 4.50 to 1.00
|
3.00%
|
2.00%
|
0.90%
|
IV
|
Greater than or equal to 4.50 to 1.00
|
3.25%
|
2.25%
|
1.00%
|
II.
|
REPRESENTATIONS AND WARRANTIES
.
|
III.
|
CONDITIONS TO EFFECTIVENESS
.
|
IV.
|
MISCELLANEOUS PROVISIONS
.
|
|
|
PACIFIC DRILLING S.A.
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
DIRECTOR
|
|
|
PACIFIC BORA LTD.
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
President
|
|
|
PACIFIC MISTRAL LTD.
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
President
|
|
|
PACIFIC SCIROCCO LTD.
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
President
|
|
|
PACIFIC SANTA ANA S.À R.L.
|
|
|
|
|
By:
|
/s/ DICK VERHAAGEN
|
|
Name:
|
Dick Verhaagen
|
|
Title:
|
Manager
|
|
|
PACIFIC DRILLING LIMITED
|
|
|
|
|
By:
|
/s/ DICK VERHAAGEN
|
|
Name:
|
Dick Verhaagen
|
|
Title:
|
Manager
|
|
|
PACIFIC INTERNATIONAL DRILLING WEST AFRICA LIMITED
|
|
|
|
|
By:
|
/s/ DICK VERHAAGEN
|
|
Name:
|
Dick Verhaagen
|
|
Title:
|
Director
|
|
|
PACIFIC SANTA ANA (GIBRALTAR) LIMITED
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
Director
|
|
|
In the presence of a witness:
|
|
|
|
|
By:
|
/s/ MORGAN T. HOTZEL
|
|
Name:
|
Morgan T. Hotzel
|
|
Title:
|
Senior Counsel
|
|
Address:
|
11700 Katy Freeway, Suite 175, Houston, Texas 77079
|
|
|
PACIFIC DRILLSHIP S.À.R.L
|
|
|
|
|
By:
|
/s/ DICK VERHAAGEN
|
|
Name:
|
Dick Verhaagen
|
|
Title:
|
Manager
|
|
|
PACIFIC DRILLING, INC.
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
President
|
|
|
PACIFIC DRILLSHIP NIGERIA LIMITED
|
|
|
|
|
By:
|
/s/ CHRISTIAN J. BECKETT
|
|
Name:
|
Christian J. Beckett
|
|
Title:
|
President
|
|
|
PACIFIC DRILLING FINANCE S.À.R.L
|
|
|
|
|
By:
|
/s/ PAUL REESE
|
|
Name:
|
Paul Reese
|
|
Title:
|
Manager
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
CITIBANK, N.A., as Administrative Agent, and Lender
|
|
|
|
|
|
By:
|
/s/ ROBERT MALLECK
|
|
Name:
|
Robert Malleck
|
|
Title:
|
Vice President
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
STANDARD CHARTERED BANK, as Issuing Lender and Lender
|
|
|
|
|
|
By:
|
/s/ STEPHEN HACKETT
|
|
Name:
|
Stephen Hackett
|
|
Title:
|
Regional Head, Structured Finance
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
THE BANK OF NOVA SCOTIA, as Lender
|
|
|
|
|
|
By:
|
/s/ J. FRAZELL
|
|
Name:
|
J. Frazell
|
|
Title:
|
Director
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
Nordea Bank AB, London Branch
|
|
|
|
|
|
By:
|
/s/ MARTIN KAHM
|
|
Name:
|
Martin Kahm
|
|
Title:
|
Head of Offshore & Oil Services
|
|
|
|
|
By:
|
/s/ MICHAEL SHEPPARD
|
|
Name:
|
Michael Sheppard
|
|
Title:
|
Vice President
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
Deutsche Bank AG New York Branch
|
|
|
|
|
|
By:
|
/s/ KELVIN JI
|
|
Name:
|
Kelvin Ji
|
|
Title:
|
Director
|
|
|
|
|
By:
|
/s/ BENJAMIN SOUH
|
|
Name:
|
Benjamin Souh
|
|
Title:
|
Vice President
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
CREDIT INDUSTRIEL ET COMMERCIAL,
as Lender
|
|
|
|
|
|
By:
|
/s/ ANDREW MCKUIN
|
|
Name:
|
Andrew McKuin
|
|
Title:
|
Managing Director
|
|
|
|
|
By:
|
/s/ ADRIENNE MOLLOY
|
|
Name:
|
Adrienne Molloy
|
|
Title:
|
Managing Director
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
GOLDMAN SACHS BANK USA
|
|
|
|
|
|
By:
|
/s/ JERRY LI
|
|
Name:
|
Jerry Li
|
|
Title:
|
Authorized Signatory
|
|
SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
|
|
NIBC BANK N.V.
|
|
|
|
|
|
By:
|
/s/ SASKIA HOVERS
|
|
Name:
|
Saskia Hovers
|
|
Title:
|
Managing Director
|
|
|
|
|
By:
|
/s/ JEROEN VAN DER PUTTEN
|
|
Name:
|
Jeroen van der Putten
|
|
Title:
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Director
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SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
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CRÉDIT AGRICOLE CORPORATE & INVESTMENT BANK, as Issuing Lender and Lender
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By:
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/s/ JEROME DUVAL
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Name:
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Jerome Duval
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Title:
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Managing Director
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By:
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/s/ YANNICK LE GOURIERES
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Name:
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Yannick Le Gourieres
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Title:
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Director
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SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
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ING CAPITAL,as Lender
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By:
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/s/ TANJA VAN DER WOUDE
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Name:
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Tanja van der Woude
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Title:
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Director
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By:
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/s/ RICHARD ENNIS
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Name:
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Richard Ennis
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Title:
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Managing Director
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SIGNATURE PAGE TO THE FIFTH AMENDMENT TO CREDIT AGREEMENT, DATED AS OF THE DATE FIRST WRITTEN ABOVE, AMONG PACIFIC DRILLING S.A., VARIOUS LENDERS PARTY HERETO AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT
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ABN AMRO CAPITAL USA LLC
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By:
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/s/ ANTONIO MOLESTINA
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Name:
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Antonio Molestina
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Title:
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Managing Director
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By:
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/s/ PASSCHIER VEEFKIND
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Name:
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Passchier Veefkind
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Title:
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Director- Energy Offshore
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Period or Date of
Determination
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Amount
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I.
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Financial Covenants
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A. Maximum Leverage Ratio (Section 10.07)
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1. Consolidated Net Debt
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As at the Computation Date
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$________
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2. Consolidated EBITDA
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$________
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3. Ratio of line 1 to line 2
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____:1.00
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B. Minimum Liquidity (Section 10.08)
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1. Unrestricted cash and Cash Equivalents
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Amount maintained on Computation Date
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$________
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2. Total Unutilized Commitment available for Loans
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$________
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3. Sum of lines 1 and 2
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$________
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C. Consolidated Net Debt to Applicable Rigs (Section 10.19)
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1. Consolidated Net Debt
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As at the Computation Date
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$________
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2. Applicable Rigs owned by the Borrower and its Subsidiaries on the Computation Date
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_______
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3. Ratio of line 1 to line 2
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$________
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NEWYORK 8107204 (2K)
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5
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(1)
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PACIFIC SHARAV S.ÀR.L.
, a private limited liability company (
société à responsabilité limitée
) incorporated under the laws of the Grand-Duchy of Luxembourg, with its registered office at 8-10, Avenue de la Gare L-1610 and registered with the Luxembourg trade and companies register under number B.169724 ("
PSS
"), as owner and joint and several borrower (together with its successors and assigns permitted under Section 29.1, a "
Borrower
");
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(2)
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PACIFIC DRILLING VII LIMITED
, a company incorporated under the laws of the British Virgin Islands ("
PDVIIL
"), as owner and joint and several borrower (together with its successors and assigns permitted under Section 29.1, a "
Borrower
");
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(3)
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PACIFIC DRILLING S.A.
, a public limited liability company (
société anonyme
) incorporated under the laws of the Grand-Duchy of Luxembourg, with its registered office at 8-10, Avenue de la Gare L-1610 Luxembourg and registered with the Luxembourg trade and companies register under number B.159658 ("
PDSA
"), as guarantor (the "
Guarantor
");
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(4)
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THE EXPORT CREDIT INSTITUTION, THE BANKS AND FINANCIAL INSTITUTIONS
listed in Schedule 1-A to the Credit Agreement (defined below), as GIEK Facility Lenders (including Eksportkreditt Norge AS, as GIEK Facility EKN Lender, (the "
GIEK Facility EKN Lender
"), and Citibank N.A., London Branch, as a GIEK Facility Commercial Lender, (the "
GIEK Facility Commercial Lender
", and together with the GIEK Facility EKN Lender, the "
GIEK Facility Lenders
"));
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(5)
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THE BANKS AND FINANCIAL INSTITUTIONS
listed in Schedule 1 to the Credit Agreement (defined below), as Commercial Facility Lenders (the "
Commercial Facility Lenders
");
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(6)
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CITIBANK N.A.
("
Citibank
")
and
DNB MARKETS, INC.
("
DNB Markets
"), as structuring banks (the "
Structuring Banks
") and as syndication agents (the "
Syndication Agents
");
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(7)
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CITIBANK
and
DNB BANK ASA, NEW YORK BRANCH
("
DNB
"), as global ECA coordinators (the "
Global ECA Coordinators
");
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(8)
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CITIBANK
, as documentation agent (the "
Documentation Agent
");
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(9)
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CITIBANK N.A., LONDON BRANCH
, as GIEK Commercial Guarantee Holder (the
"
GIEK Commercial Guarantee Holder
");
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(10)
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EKSPORTKREDITT NORGE AS
, as GIEK EKN Guarantee Holder (the "
GIEK EKN Guarantee Holder
");
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(11)
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DNB
, as administrative agent and security agent (together with any successor administrative agent and security agent appointed pursuant to Section 28 of the Credit Agreement, the "
Administrative Agent
" or as applicable, the "
Security Agent
") and as account bank (in such capacity, the "
Account Bank
") and as GIEK facility agent (in such capacity, the "
GIEK Facility Agent
");
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(12)
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CITIBANK, DNB, ABN AMRO CAPITAL USA LLC, ING CAPITAL LLC, SKANDINAVISKA ENSKILDA BANKEN AB (PUBL.)
and
STANDARD CHARTERED BANK PLC
, as mandated lead arrangers (the "
Mandated Lead Arrangers
"); and
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(13)
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CITIBANK, DNB
MARKETS, ABN AMRO CAPITAL USA LLC, ING CAPITAL LLC, SKANDINAVISKA ENSKILDA BANKEN AB (PUBL.)
and
STANDARD CHARTERED BANK PLC
, as book runners (the "
Bookrunners
").
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PACIFIC SHARAV S.ÀR.L.
By:
/s/ JOHANNES BOOTS
Name: Johannes Boots
Title: Manager
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PACIFIC DRILLING VII LIMITED
By:
/s/ PAUL REESE
Name: Paul Reese
Title: Vice President
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PACIFIC DRILLING S.A.
By:
/s/ PAUL T. REESE
Name: Paul T. Reese
Title: Chief Financial Officer
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DNB BANK ASA, NEW YORK BRANCH, as Administrative Agent and as Security Agent
By:
/s/ BARBARA GRONQUIST
Name: Barbara Gronquist
Title: Senior Vice President
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By:
/s/ PHILIPPE WULFERS
Name: Philippe Wulfers
Title: Vice President
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EKSPORTKREDITT NORGE AS, as a GIEK Facility EKN Lender
By:
/s/ JOSTEIN DJUPVIK
Name: Jostein Djupvik
Title:
By:
Name:
Title:
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DNB CAPITAL LLC, as Lender
By:
/s/ BARBARA GRONQUIST
Name: Barbara Gronquist
Title: Senior Vice President
By:
/s/ PHILIPPE WULFERS
Name: Philippe Wulfers
Title: Vice President
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CITIBANK, N.A., LONDON BRANCH, as Lender
By:
/s/ ROBERT MALLECK
Name: Robert Malleck
Title: Vice President
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ABN AMRO CAPITAL USA LLC, as Lender
By:
/s/ ANTONIO MOLESTINA
Name: Antonio Molestina
Title: Managing Director
By:
/s/ PASSCHIER VEEFKIND
Name: Passchier Veefkind
Title: Director- Energy Offshore
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CRÉDIT AGRICOLE CORPORATE & INVESTMENT BANK, as Lender
By:
/s/ JEROME DUVAL
Name: Jerome Duval
Title: Managing Director
By:
/s/ Y. LE GOURIÉRÈS
Name: Y. Le Gouriérès
Title: Director
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CRÉDIT INDUSTRIEL ET COMMERCIAL, as Lender
By:
/s/ ANDREW MCKUIN
Name: Andrew McKuin
Title: Managing Director
By:
/s/ ADRIENNE MOLLOY
Name: Adrienne Molloy
Title: Managing Director
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ING CAPITAL LLC, as Lender
By:
/s/ TANJA VAN DER WOUDE
Name: Tanja van der Woude
Title: Director
By:
/s/ RICHARD ENNIS
Name: Richard Ennis
Title: Managing Director
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NIBC BANK N.V., as Lender
By:
/s/ SASKIA HOVERS
Name: Saskia Hovers
Title: Managing Director
By:
/s/ JEROEN VAN DER PUTTEN
Name: Jeroen van der Putten
Title: Director
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SKANDINAVISKA ENSKILDA BANKEN AB (PUBL.), as Lender
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
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STANDARD CHARTERED BANK PLC, as Lender
By:
/s/ STEPHEN HACKETT
Name: Stephen Hackett
Title: Regional Head, Structured Finance
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ABN AMRO Bank N.V., as Lender
By:______________________________
Name:
Title:
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PACIFIC DRILLING (GIBRALTAR) LIMITED, as Pledgor
By:
/s/ CHRISTIAN J. BECKETT
Name: Christian J. Beckett
Title: Director
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Financial Covenant
|
Period or Date of Determination
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Amount
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A. Consolidated Tangible Net Worth (Section 13.8(a))
|
As at the Computation Date
|
$______________
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B. Leverage Ratio (Section 13.8(b))
|
|
|
1.
Consolidated Net Debt
|
As at the Computation Date
|
$______________
|
2.
Consolidated EBITDA
|
As at the Computation Date
|
$______________
|
3.
Ratio of line 1 to line 2
|
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____:1.00
|
|
|
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C. Projected DSCR (Section 13.8(c))
|
|
|
1.
EBITDA of the Group
|
For the following four fiscal quarters
|
$______________
|
2.
All obligations of members of the Group to pay interest (net of hedging payments and receipts) forecast to be paid during such specified period plus one tenth (1/10th) of Total Debt
|
For the following four fiscal quarters
|
$______________
|
3.
Ratio of line 1 to line 2
|
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____:1.00
|
|
|
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D. Total Debt to Total Capitalization Ratio (Section 13.8(d))
|
|
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1.
Total Debt
|
As at the Computation Date
|
$______________
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2.
Total Capitalization
|
As at the Computation Date
|
$______________
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3.
Ratio of line 1 to line 2
|
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____:1.00
|
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|
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E. Minimum Liquidity (Section 13.8(f)) (aggregate of cash and Cash Equivalents in the Group Corporate Accounts free and clear of all liens or restrictions other than Security Interests created in connection with the Finance Documents)
|
As at the Computation Date
|
$______________
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F. Minimum Value (Section 13.8(g))
|
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1.
Aggregate Fair Market Value of the Collateral Vessels
|
As at the last date on which Fair Market Value was measured
|
$______________
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2.
Sum of the then aggregate outstanding principal amount under the Credit Agreement
|
As at the Computation Date
|
$______________
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3.
Line 1 divided by line 2 (%)
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______%
|
|
|
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G. Net Debt to Applicable Rigs (Section 13.8(i))
|
|
|
1.
Net Debt
|
As at Computation Date
|
$______________
|
2.
Applicable Rigs
|
As at Computation Date
|
___
|
3.
Line 1 divided by line 2
|
|
$______________
|
Financial Covenant
|
Period or Date of Determination
|
Amount
|
A. Consolidated Tangible Net Worth (Section 13.8(a))
|
As at the Computation Date
|
$______________
|
|
|
|
B. Leverage Ratio (Section 13.8(b))
|
|
|
4.
Consolidated Net Debt
|
As at the Computation Date
|
$______________
|
5.
Consolidated EBITDA
|
As at the Computation Date
|
$______________
|
6.
Ratio of line 1 to line 2
|
|
____:1.00
|
|
|
|
C. Projected DSCR (Section 13.8(c))
|
|
|
4.
EBITDA of the Group
|
For the following four fiscal quarters
|
$______________
|
5.
All obligations of members of the Group to pay interest (net of hedging payments and receipts) forecast to be paid during such specified period plus one tenth (1/10th) of Total Debt
|
For the following four fiscal quarters
|
$______________
|
6.
Ratio of line 1 to line 2
|
|
____:1.00
|
|
|
|
D. Total Debt to Total Capitalization Ratio (Section 13.8(d))
|
|
|
4.
Total Debt
|
As at the Computation Date
|
$______________
|
5.
Total Capitalization
|
As at the Computation Date
|
$______________
|
6.
Ratio of line 1 to line 2
|
|
____:1.00
|
|
|
|
E. Minimum Liquidity (Section 13.8(f)) (aggregate of cash and Cash Equivalents in the Group Corporate Accounts free and clear of all liens or restrictions other than Security Interests created in connection with the Finance Documents)
|
As at the Computation Date
|
$______________
|
|
|
|
F. Minimum Value (Section 13.8(g))
|
|
|
4.
Aggregate Fair Market Value of the Collateral Vessels
|
As at the last date on which Fair Market Value was measured
|
$______________
|
5.
Sum of the then aggregate outstanding principal amount under the Credit Agreement
|
As at the Computation Date
|
$______________
|
6.
Line 1 divided by line 2 (%)
|
|
______%
|
Entity
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|
Jurisdiction of Formation
|
Pacific Drilling do Brasil Investimentos Ltda.
|
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Brazil
|
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Pacific Drilling do Brasil Serviços de Perfuração Ltda.
|
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Brazil
|
|
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Pacific Drilling Services Pte. Ltd.
|
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Singapore
|
|
|
|
Pacific International Drilling West Africa Limited
|
|
Nigeria
|
|
|
|
Pacific Drilling Netherlands Coöperatief U.A.
|
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The Netherlands
|
|
|
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Pacific Drilling N.V.
|
|
Curacao
|
|
|
|
Pacific Drilling Administrator Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Deepwater Construction Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling International Ltd
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling Manpower Ltd
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling Operations Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling South America 1 Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling South America 2 Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling V Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling VII Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Drilling VIII Limited
|
|
British Virgin Islands
|
|
|
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Pacific Drillship Nigeria Limited
|
|
British Virgin Islands
|
|
|
|
Pacific Bora Ltd.
|
|
Liberia
|
|
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|
Pacific Mistral Ltd.
|
|
Liberia
|
|
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|
Pacific Scirocco Ltd.
|
|
Liberia
|
|
|
|
Pacific Drilling Limited
|
|
Liberia
|
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|
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Pacific Drilling, Inc.
|
|
USA, Delaware
|
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Pacific Drilling International, LLC
|
|
USA, Delaware
|
|
|
|
Pacific Drilling Services, Inc.
|
|
USA, Delaware
|
|
|
|
Pacific Drilling Manpower, Inc.
|
|
USA, Delaware
|
|
|
|
Pacific Drilling Operations, Inc.
|
|
USA, Delaware
|
|
|
|
Pacific Drilling Finance S.à r.l.
|
|
Luxembourg
|
|
|
|
Pacific Drillship S.à r.l.
|
|
Luxembourg
|
|
|
|
Pacific Drilling Manpower S.à r.l.
|
|
Luxembourg
|
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|
|
Pacific Santa Ana S.à r.l.
|
|
Luxembourg
|
|
|
|
Pacific Sharav S.à r.l.
|
|
Luxembourg
|
|
|
|
Pacific Drilling (Gibraltar) Limited
|
|
Gibraltar
|
|
|
|
Pacific Drillship (Gibraltar) Limited
|
|
Gibraltar
|
|
|
|
Pacific Drilling Holding (Gibraltar) Limited
|
|
Gibraltar
|
|
|
|
Pacific Santa Ana (Gibraltar) Limited
|
|
Gibraltar
|
By:
|
|
/s/ Christian J. Beckett
|
Name:
|
|
Christian J. Beckett
|
Title:
|
|
Chief Executive Officer
|
By:
|
|
/s/ Paul T. Reese
|
Name:
|
|
Paul T. Reese
|
Title:
|
|
Chief Financial Officer
|
Date: March 1, 2016
|
||
|
|
|
By:
|
|
/s/ Christian J. Beckett
|
Name:
|
|
Christian J. Beckett
|
Title:
|
|
Chief Executive Officer
|
Date: March 1, 2016
|
||
|
|
|
By:
|
|
/s/ Paul T. Reese
|
Name:
|
|
Paul T. Reese
|
Title:
|
|
Chief Financial Officer
|