Item 1.01Entry into a Material Definitive Agreement
On January 31, 2023, in connection with the closing of the previously-announced
offering by Transocean Inc. (the "Issuer"), a wholly-owned subsidiary of
Transocean Ltd., of U.S. $1.175 billion in aggregate principal amount of 8.75%
senior secured notes due 2030 (the "Notes"), the Issuer entered into an
indenture (the "Indenture") with (x) Transocean Ltd., (y) certain of the
Issuer's subsidiaries (the "Limited Guarantors" and together with Transocean
Ltd., the "Guarantors") that guarantee the existing (i) 7.75% Senior Secured
Notes due 2024 issued by Transocean Phoenix 2 Limited (the "Thalassa Notes"),
(ii) 5.875% Senior Secured Notes due 2024 issued by Transocean Guardian Limited
(the "Guardian Notes"), (iii) 6.25% Senior Secured Notes due 2024 issued by
Transocean Proteus Limited (the "Proteus Notes") and (iv) 6.125% Senior Secured
Notes due 2025 issued by Transocean Pontus Limited (the "Pontus Notes" and
collectively, the "Existing Secured Notes") and (z) Truist Bank, as trustee and
collateral agent. The Notes are fully and unconditionally guaranteed on a senior
unsecured basis by Transocean Ltd. and guaranteed on a senior secured basis by
the Limited Guarantors, in each case, up to a secured guarantee cap equal to the
principal amount of such notes refinanced (together with any applicable premium,
fees and expenses) (the "Secured Limited Guarantee Cap"). Accordingly, the
Limited Guarantors are subject to a Secured Limited Guarantee Cap on the Notes
equal to $247 million, $320 million, $256 million and $352 million,
respectively.
The Notes are also secured by a lien on Deepwater Thalassa, Deepwater Proteus,
Transocean Enabler, Transocean Encourage and Deepwater Pontus (the "Collateral
Rigs") and certain other assets related to the Collateral Rigs, up to the
applicable Secured Limited Guarantee Cap. The Notes have not been registered
under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or
under any state securities laws, and were offered only to qualified
institutional buyers under Rule 144A under the Securities Act and outside the
United States in compliance with Regulation S under the Securities Act.
The terms of the Notes are governed by the Indenture, which contains covenants
that, among other things, (i) limit the activities of the Issuer, each owner and
each operator of the Collateral Rigs, (ii) limit the ability of the Issuer and
its subsidiaries to incur liens and engage in certain sale and lease-back
transactions, (iii) limit the ability of the Issuer's subsidiaries to incur
indebtedness, and (iv) limit the ability of the Issuer and the Guarantors to
consolidate, merge or enter into a scheme of arrangement qualifying as an
amalgamation. The Indenture also contains customary events of default.
Indebtedness under the Notes may be accelerated in certain circumstances upon an
event of default as set forth in the Indenture.
On January 17, 2023, each of the issuers of the Existing Secured Notes exercised
its right to optionally redeem all of its applicable series of the Existing
Secured Notes at the applicable redemption price for such series, which
redemptions were conditioned upon and subject to the Notes issuance. The
redemptions are currently expected to be consummated on February 16, 2023,
assuming the satisfaction by such date of the conditions thereto. Concurrently
with the closing of the offering of the Notes, the redemption price was
deposited with the trustee under the indentures governing each series of
Existing Secured Notes, such indentures were satisfied and discharged and the
liens securing the obligations under such indentures were released. This report
does not constitute a notice of redemption under the optional redemption
provisions of the indentures governing the Existing Secured Notes.
All of the net proceeds from the Notes were used to fund the redemption of all
of the outstanding Existing Secured Notes, subject to the satisfaction of the
conditions precedent thereto. Transocean Inc. transferred a portion of the net
proceeds from the Notes issuance, together with cash on hand to the extent
required to complete such redemptions, to each applicable subsidiary issuer of
the respective series of Existing Secured Notes, and each such issuer applied
such proceeds to consummate such redemption, subject to the satisfaction of the
conditions precedent thereto.
The description above does not purport to be complete and is qualified in its
entirety by the Indenture filed herewith as Exhibit 4.1 to this Current
Report on Form 8-K.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The information described in Item 1.01 is incorporated herein by reference.
Item 9.01Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. Description
4.1 Indenture, dated as of January 31, 2023, among Transocean Inc.,
the Guarantors named therein and Truist Bank, as trustee and as
collateral agent
101 Interactive data files pursuant to Rule 405 of Regulation S-T
formatted in Inline Extensible Business Reporting Language
104 Cover Page Interactive Data File (formatted as inline XBRL).
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