Seadrill Limited — Capital/Financing Update 2021

Jun 18, 2021

Seadrill New Finance Limited (the "Issuer") - Update on Restructuring Discussions and SeaMex Ltd Joint Venture

Seadrill New Finance Limited (the "Issuer") - Update on Restructuring Discussions and SeaMex Ltd Joint Venture

Hamilton, Bermuda | June 18, 2021 - Seadrill Limited ("Seadrill" or the

"Company") (OSE: SDRL, OTCPK:SDRLF) and the Issuer announce that, further to the

announcement made by Seadrill and the Issuer on June 11, 2021, the Issuer is in

advanced discussions with certain holders of the Issuer's 12.0% senior secured

notes due 2025 (the "Notes") around a proposed restructuring of the Notes.

Further to the announcement on June 11, 2021, this announcement also provides an

update on the provisional liquidation process in respect of SeaMex Ltd.

("SeaMex").

Restructuring of the Notes

The Issuer and certain holders of the Notes are in advanced discussions around a

comprehensive restructuring of the Notes.  The expectation is that a

restructuring support agreement documenting key commercial terms will be entered

into in the near term, following which Seadrill and the Issuer will publish a

further announcement.

In connection with the restructuring discussions, the Issuer and certain holders

of the Notes have agreed to further extend the existing forbearance agreement

announced on 19 April 2021, and extended on May 17, 2021, May 27, 2021 and June

3, 2021 until the earlier of June 25, 2021 and any termination of the

forbearance agreement.

The purpose of the forbearance agreement is to allow the Issuer and its

stakeholders time to finalise negotiations in respect of the restructuring,

which may involve the use of a court-supervised implementation process,

including potentially a pre-packaged or pre-arranged Chapter 11 process, or

scheme of arrangement.

SeaMex restructuring

The restructuring discussions described above also include a restructuring

proposal in respect of SeaMex, a 50/50 joint venture between one of the Issuer's

subsidiaries, Seadrill JU Newco Bermuda Ltd, and an investment fund controlled

by Fintech Holdings Limited ("Fintech").  The key terms of this proposal

include:

· materially deleveraging SeaMex's balance sheet by equitizing all or a

significant proportion of the approximately $454 million of subordinated debt

owed to subsidiaries of the Issuer; and

· injecting short-term liquidity into SeaMex in order to bridge towards a

refinancing of SeaMex's senior secured bank debt as part of a comprehensive

restructuring of SeaMex's balance sheet; and

Following the execution of a debt trade on June 16, 2021, certain holders of the

Notes have agreed to become the owners of all of the SeaMex group's

approximately $190 million of senior secured bank debt.

SeaMex provisional liquidator appointment

John C. McKenna of Finance & Risk Services Ltd, and Simon Appell of AlixPartners

UK LLP, have today been appointed as joint provisional liquidators in respect of

SeaMex by an order of the Supreme Court of Bermuda (the "JPLs").  The JPL

appointment was supported by Seadrill, Fintech and the SeaMex board of

directors.

The appointment of the JPLs will benefit from funding in order to bridge towards

an orderly restructuring of SeaMex's balance sheet for the benefit of all

stakeholders, including employees, customers and suppliers.

The restructuring may include, if the JPLs consider it to be consistent with

their duties and in the best interests of SeaMex, a sale of SeaMex's

subsidiaries to a wholly owned subsidiary of the Issuer in exchange for (i) the

release of all or substantially all of the subordinated debt owed to

subsidiaries of the Issuer; and (ii) a novation of SeaMex's guarantee of the

senior bank debt, to implement the restructuring described above.  An

independent valuation of the SeaMex group has been obtained and the JPLs intend

to conduct an accelerated market testing process in respect of SeaMex, to ensure

that any proposed transaction maximises value for creditors as a whole when

compared to alternative options that may be capable of implementation.  In the

absence of a consensual agreement with Fintech on restructuring terms, the

proposed restructuring may result in Fintech ceasing to have an equity interest

in the go-forward SeaMex group.

The proposed SeaMex restructuring and JPL appointment is only at the SeaMex

holding company level and will not impact the operational activities of the

business.  There will similarly be no impact to employees, customers or

suppliers.

The Issuer intends to continue to engage in a constructive dialogue with

SeaMex's key customer, Pemex Exploración y Producción ("Pemex") in relation to

the recovery of historic unpaid invoices (including approximately $245 million

which have been issued but remain unpaid (Copades)), and potential amendments to

the terms of SeaMex's contracts with Pemex.  In the meantime, the Issuer is

taking steps to seek consents from the Noteholders to obtain access to funds in

the Issuer's mandatory offer holding account to ensure the SeaMex group has

continued access to funding.

About Seadrill

Seadrill is a leading offshore drilling contractor utilizing advanced technology

to unlock oil and gas resources for clients across harsh and benign locations

across the globe. Seadrill's high quality, technologically advanced fleet spans

all asset classes allowing its experienced crews to conduct its operations from

shallow to ultra-deep-water environments. The company operates 43 rigs, which

includes drillships, jack-ups and semi-submersibles.

Seadrill is listed on the Oslo Børs and OTC Pink markets. For more information,

visit https://www.seadrill.com/.

FORWARD LOOKING STATEMENTS

This news release includes forward looking statements. Such statements are

generally not historical in nature, and specifically include statements about

the Company's plans, strategies, business prospects, changes and trends in its

business, the markets in which it operates and its restructuring efforts. These

statements are made based upon management's current plans, expectations,

assumptions and beliefs concerning future events impacting the Company and

therefore involve a number of risks, uncertainties and assumptions that could

cause actual results to differ materially from those expressed or implied in the

forward-looking statements, which speak only as of the date of this news

release. Consequently, no forward-looking statement can be guaranteed. When

considering these forward-looking statements, you should keep in mind the risks

described from time to time in the Company's regulatory filings and periodical

reporting. The Company undertakes no obligation to update any forward looking

statements to reflect events or circumstances after the date on which such

statement is made or to reflect the occurrence of unanticipated events. New

factors emerge from time to time, and it is not possible for the Company to

predict all of these factors. Further, the Company cannot assess the impact of

each such factor on its business or the extent to which any factor, or

combination of factors, may cause actual results to be materially different from

those contained in any forward looking statement.

This information is subject to the disclosure requirements pursuant to section 5

-12 of the Norwegian Securities Trading Act.

seadrill@hawthornadvisors.com

020 3745 4960