AMENDMENT NO. 7 TO CREDIT AGREEMENT

 

 

 

 

This Amendment No. 7 to Credit Agreement, dated as of September 26, 2012, (this “Amendment”), is entered into by HELIX ENERGY SOLUTIONS GROUP, INC., a Minnesota corporation (the “Borrower”), the lenders party to the Credit Agreement described below, and BANK OF AMERICA, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”), Swing Line Lender and L/C Issuer.

 

 

Reference is made to the Credit Agreement dated as of July 3, 2006 (as modified from time to time, the “Credit Agreement”), among the Borrower, the lenders from time to time party thereto (collectively, the “Lenders” and individually, a “Lender”), and the Administrative Agent.

 

The Borrower seeks flexibility (i) in making Investments in its Foreign Subsidiaries and joint ventures and, (ii) for its Foreign Subsidiaries to incur secured and unsecured Indebtedness.

 

The Borrower has requested, and the Lenders and the Administrative Agent have agreed, on the terms and conditions set forth herein, to make certain amendments to the Credit Agreement.

 

THEREFORE, in connection with the foregoing and for other good and valuable consideration, the Borrower, the Lenders, and the Administrative Agent hereby agree as follows:

 

Section 1. Definitions; References.  Unless otherwise defined in this Amendment, each term used in this Amendment that is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement.

 

Section 2. Amendment of Credit Agreement.

 

(a) Section 1.01 of the Credit Agreement is hereby amended by adding the following definition  in appropriate alphabetical order:

 

“Excluded Foreign Subsidiary Assets” means the property or assets of, or Equity Interests in, any Foreign Subsidiary which are subject to a Lien or negative pledge pursuant to Indebtedness incurred under Section 7.03(o).

 

(b) Section 7.01 of the Credit Agreement is hereby amended by replacing clause (u) thereto in its entirety with the following:

 

(u) Liens on the property or assets of, or Equity Interests in, Foreign Subsidiaries, other than Helix Offshore Ltd. (or any Subsidiary of Helix Offshore Ltd. owning, directly or indirectly, any of (y) the Equity Interests of Helix Well Ops (U.K.) Limited (or other Subsidiary owning the Seawell in whole or in part) or (z) the Equity Interests of any Person owning, directly or indirectly, any such Equity Interests), in each case, securing Indebtedness permitted under Section 7.03(o).

 

 

(c) Section 7.02 of the Credit Agreement is hereby amended by replacing clause (g) thereto in its entirety with the following:

 

(g) Investments in joint ventures, subject to the final clause of this Section 7.02, if immediately before and after giving effect to such Investment, no Default shall have occurred and be continuing;

 

(d) Section 7.02 of the Credit Agreement is hereby amended by replacing the final clause thereto in its entirety with the following:

 

Notwithstanding anything in this Section 7.02 or elsewhere in this Agreement to the contrary, no Investment shall be permitted in any joint venture or in any Subsidiary that is neither a Loan Party nor a Foreign Subsidiary whose Equity Interests are pledged pursuant to a Foreign Pledge Agreement, unless, immediately after giving effect to any such Investment, the sum of the Availability plus unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries is equal to or more than $400,000,000.

 

(e) Section 7.03 of the Credit Agreement is hereby amended by replacing clause (o) thereto in its entirety with the following:

 

(o) Indebtedness of Foreign Subsidiaries, other than Helix Offshore Ltd. (or any Subsidiary of Helix Offshore Ltd. owning, directly or indirectly, any of (y) the Equity Interests of Helix Well Ops (U.K.) Limited (or other Subsidiary owning the Seawell in whole or in part) or (z) the Equity Interests of any Person owning, directly or indirectly, any such Equity Interests), in an aggregate principal amount not to exceed $400,000,000 at any time outstanding; provided that such Indebtedness is expressly made non-recourse to the Borrower and its Subsidiaries (other than the Subsidiary incurring such Indebtedness) and other than any recourse to the Equity Interests of such Subsidiary to the extent pledged as collateral therefor.

 

(f) Section 7.05 of the Credit Agreement is hereby amended by replacing clause (q) thereto in its entirety with the following:

 

(q) Dispositions of Oil and Gas Properties, the Caesar and Reeled Pipelay Assets (or all of the Equity Interests of any Subsidiary owning no assets other than any of the foregoing assets) not otherwise permitted under this Section 7.05; provided, that (i) at the time of such Disposition, no Default shall exist or immediately would result from such Disposition, (ii) except as otherwise specifically provided below, no less than 75% of the consideration received for any such asset shall be in the form of cash (which, solely for purposes of this clause (q), shall be deemed to include any liabilities, as shown on the Borrower’s most recent consolidated balance sheet, of the Borrower or any Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Loans or any Guaranty thereof) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Borrower or such Subsidiary from further liability), and (iii) 100% of the Net Cash Proceeds of any such Disposition shall be applied to the prepayment of the Loans in accordance with Section 2.06(d).  For the avoidance of doubt, in the case of Oil and Gas Properties such

 

 

 

provided, however, that any Disposition pursuant to clauses (a) through (g), (j)(ii), (k), (m), (n), (p) and (q) shall be for fair market value.

 

For purposes of determining compliance with this Section 7.05, the fair market value of any property Disposed of for consideration not consisting entirely of cash shall be the sum of the cash portion of the consideration, if any, and the fair market value of the non-cash portion of the consideration, as reasonably determined by the Borrower in good faith.

 

(g) Section 7.09 of the Credit Agreement is hereby amended by replacing clause (A) of the second proviso appearing in such Section in its entirety with the following:

 

(A) prohibit any negative pledge incurred or provided in favor of any holder of (1) a Lien permitted by Section 7.01(f), (i), (q), (r), (s), (t) or (u), (2) secured Indebtedness permitted under Section 7.03(e), (h), (n) or (o), in each case, solely to the extent any such negative pledge relates to the property financed by or the subject of such Indebtedness or permitted by the terms of such provisions to be encumbered (or, in the case of a Lien permitted by Section 7.01(u) or secured Indebtedness permitted under Section 7.03(o), the Equity Interests of the Foreign Subsidiary incurring such Indebtedness) or (3) Indebtedness permitted under Section 7.03(o) solely to the extent any such negative pledge relates to property of the Foreign Subsidiaries obligated thereon and

 

(h) Section 7.11 of the Credit Agreement is hereby amended by adding the following paragraph at the end of such Section:

 

For purposes of calculating the Consolidated Interest Coverage Ratio, the Consolidated Leverage Ratio and the Consolidated Senior Secured Leverage Ratio for all purposes of this Agreement, (a) Consolidated EBITDA attributable to Excluded Foreign Subsidiary Assets shall be excluded from Consolidated EBITDA and Consolidated Interest Charges attributable to the Indebtedness relating to Excluded Foreign Subsidiary Assets shall be excluded from Consolidated Interest Charges and (b) Indebtedness of Foreign Subsidiaries incurred under Section 7.03(o) and secured by any Excluded Foreign Subsidiary Assets (or a negative pledge thereon) shall be excluded from Consolidated Funded Indebtedness and Consolidated Funded Senior Secured Indebtedness.  The foregoing items and related calculations thereof, including all adjustments to Consolidated EBITDA, Consolidated Interest Charges, Consolidated Leverage Ratio, and Consolidated Senior Secured Leverage Ratio, shall be set forth in each applicable Compliance Certificate and shall be acceptable to the Administrative Agent.

 

 

 

(i) Exhibit D (Form of Compliance Certificate) to the Credit Agreement is hereby deleted in its entirety and replaced with Exhibit D attached hereto.

 

Section 3. Representations and Warranties.  The Borrower represents and warrants that (a) the execution, delivery, and performance of this Amendment by each Loan Party are within the corporate or equivalent power and authority of such Loan Party and have been duly authorized by all necessary corporate or other organizational action, (b) this Amendment, and the Credit Agreement as amended hereby, constitute legal, valid, and binding obligations of each Loan Party, enforceable against each Loan Party in accordance with their terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws of general applicability affecting the enforcement of creditors’ rights and the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or law); (c) the representations and warranties of the Borrower and each other Loan Party contained in each Loan Document are true and correct in all material respects as of the date of this Amendment, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date and except that for purposes of this Section 3(c), the representations and warranties contained in subsections (a), (b) and (c) of Section 5.05 of the Credit Agreement shall be deemed to refer to the most recent statements, Reserve Report, or Interim Engineer’s Certificate, as applicable, furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Credit Agreement or clause (f) of Section 6.02 of the Credit Agreement, as applicable; (d) no Default or Event of Default exists under the Loan Documents; and (e) the Liens under the Security Documents are valid and subsisting and secure the Obligations.

 

Section 4. Effect on Credit Documents.  Except as heretofore amended and in effect and amended herein, the Credit Agreement and all other Loan Documents remain in full force and effect as originally executed.  Nothing herein shall act as a waiver of any of the Administrative Agent’s or any Lender’s rights under the Loan Documents as amended, including the waiver of any default or event of default, however denominated.  Each party hereto acknowledges and agrees that this Amendment shall in no manner impair or affect the validity or enforceability of the Credit Agreement, as amended hereby.  This Amendment is a Loan Document for the purposes of the provisions of the other Loan Documents.  Without limiting the foregoing, any breach of representations, warranties, and covenants under this Amendment may be a default or event of default under the other Loan Documents.

 

Section 5. Effectiveness.  This Amendment shall become effective, and the Credit Agreement shall be amended as provided for herein as of the date first set forth above, upon the satisfaction of the following conditions:

 

(a) the Administrative Agent (or its counsel) shall have received counterparts hereof duly executed and delivered by a duly authorized officer of the Borrower, each Guarantor, and by the Lenders whose consent is required to effect the amendments contemplated hereby; and

 

(b) the Administrative Agent shall have received, or shall concurrently receive (i) for the account of each Lender executing this Amendment by 5:00 p.m. (Central) on September 24, 2012, an amendment fee equal to 12.5 basis points on the principal amount of such Lender’s

 

 

 

Section 6. Reaffirmation of Guaranty.  By its signature hereto, each Guarantor represents and warrants that such Guarantor has no defense to the enforcement of the Guaranty, and that according to its terms the Guaranty will continue in full force and effect to guaranty the Borrower’s obligations under the Credit Agreement and the other amounts described in the Guaranty following the execution of this Amendment.

 

Section 7. Governing Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

Section 8. Miscellaneous.  The miscellaneous provisions set forth in Article X of the Credit Agreement apply to this Amendment.  This Amendment may be signed in any number of counterparts, each of which shall be an original, and may be executed and delivered electronically, including by telecopier and portable digital format (.PDF).

 

Section 9. ENTIRE AGREEMENT.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

 

[signature page follows]

 

 

EXECUTED as of the first date above written.

 

 

BORROWER

 

 

 

 

 

GUARANTORS

 

 

CAESAR HOLDING CO LLC, a Delaware limited liability company

CANYON OFFSHORE, INC., a Texas corporation

CANYON OFFSHORE INTERNATIONAL CORP., a Texas corporation

ENERGY RESOURCE TECHNOLOGY GOM, INC., a Delaware corporation

HELIX INGLESIDE LLC, a Delaware limited liability company

HELIX OFFSHORE INTERNATIONAL, INC., a Texas corporation

HELIX SUBSEA CONSTRUCTION, INC., a Delaware corporation

HELIX VESSEL HOLDINGS LLC, a Delaware limited liability company

HELIX WELL OPS INC., a Texas corporation

NEPTUNE VESSEL HOLDINGS LLC, a Delaware limited liability company

VULCAN MARINE TECHNOLOGY LLC, a Delaware limited liability company

 

	By:	/s/ Anthony Tripodo
	Name:	Anthony Tripodo
	Title:	Vice President and Treasurer

                                       

 

 

 

 

 

 

 

 

 

Financial Statement Date:                                                                          ,

 

To:           Bank of America, N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Credit Agreement, dated as of July 3, 2006 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the "Agreement;" the terms defined therein being used herein as therein defined), among Helix Energy Solutions Group, Inc., a Minnesota corporation (the "Borrower"), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender.

 

The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the                                                                        of the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent on the behalf of the Borrower, and that:

 

 

Attached hereto as Schedule 1 are the year-end audited financial statements required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section.

 

 

Attached hereto as Schedule 1 are the unaudited financial statements required by Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the above date.  Such financial statements fairly present the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.

 

The undersigned is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a review of the transactions and condition (financial or otherwise) of the Borrower during the accounting period covered by the attached financial statements with a view to determine whether during such fiscal period the Borrower performed and observed all its Obligations under the Loan Documents, and

 

 

 

 

 

 

 

The representations and warranties of the Borrower contained in Article V of the Agreement, and any representations and warranties of the Borrower that are contained in any document furnished at any time under or in connection with the Loan Documents, are true and correct in all material respects on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in subsections (a), (b) and (c) of Section 5.05 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b) respectively, of Section 6.01 of the Agreement, including the statements in connection with which this Compliance Certificate is delivered, or clause (f) of Section 6.02 of the Agreement, as applicable (but in each case, giving effect to any knowledge qualifies in such Sections with respect to Remington and its Subsidiaries only for periods ending prior to the Closing Date, and only for so long as and to the extent that the information for such periods is included in the information provided pursuant to the applicable Section).

 

The financial covenant analyses and information set forth on Schedules 2 and 3 attached hereto are true and accurate on and as of the date of this Certificate.

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate as

 

of                               ,                     .

 

 

 

         For the Quarter/Year ended ___________________("Statement Date")

 

 

to the Compliance Certificate

 

I.	Section 7.11(a) – Consolidated Interest Coverage Ratio.

 

A.	Consolidated EBITDA for four consecutive fiscal
	quarters ending on above date ("Subject Period")
	as set forth on Schedule 3 hereto:		$
B.	Consolidated EBITDA for Subject Period attributable
	to Excluded Foreign Subsidiary Assets:		$
C.	Consolidated Interest Charges for Subject Period:		$
D.	Consolidated Interest Charges for Subject Period
	attributable to Indebtedness relating to Excluded
	Foreign Subsidiary Assets:		$
E.	Consolidated Interest Coverage Ratio
	((Line I.A – Line I.B.) ÷ (Line I.C – Line I.D)):				to 1.00
	Minimum required:			2.75 to 1.00

 

II.	Section 7.11(b) – Consolidated Leverage Ratio.

 

                 1 Excluding Acquisitions/Dispositions of Excluded Foreign Subsidiary Assets.

 

III.	Section 7.11(c) – Collateral Coverage Ratio.

 

IV.	Section 7.11(d) – Consolidated Senior Secured Leverage Ratio.

 

 

V.	Section 7.12 – Capital Expenditures.

 

 

 

 

to the Compliance Certificate

($ in 000's)

 

(in accordance with the definition of Consolidated EBITDA

as set forth in the Agreement)

 

Consolidated  EBITDA	Quarter Ended __________	Quarter Ended __________	Quarter Ended __________	Quarter Ended __________	Twelve Months Ended __________
Consolidated  Net Income
+ Consolidated Interest Charges
+ income taxes
+ depreciation expense
+ amortization expense
+ depletion expense
+ non-recurring non-cash charges or losses
+ non-capitalized transaction costs of Transaction
- non-recurring non-cash items
- net income from non Subsidiaries (to extent included in Consolidated Net Income)

 

 

 

to the Compliance Certificate

($ in 000's)

 

(in accordance with the definition of Collateral

Coverage Ratio as set forth in the Agreement)