1
EXHIBIT 10.17
FACILITY AGREEMENT
between
GULF OFFSHORE SHIPPING SERVICES, INC.
as borrower
GULFMARK INTERNATIONAL, INC.
GULFMARK NORTH SEA LIMITED
and
GULF OFFSHORE MARINE INTERNATIONAL INC.
as sponsors
CHASE MANHATTAN INTERNATIONAL LIMITED
as agent
and security trustee
THE CHASE MANHATTAN BANK
as initial bank
and
OTHERS
XXXXXXXX CHANCE
LONDON
2
CONTENTS
CLAUSE PAGE NO.
PART 1
INTERPRETATION . . . . . . . . . . . . . . . . . . . . . . . . 1
1. INTERPRETATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
PART 2
THE FACILITY . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. THE FACILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3. PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4. NATURE OF BANK'S OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
5. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
PART 3
AVAILABILITY OF THE FACILITY . . . . . . . . . . . . . . . . . . . . . 12
6. AVAILABILITY OF THE FACILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
7. DETERMINATION OF AVAILABLE AMOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
PART 4
INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . 14
8. INTEREST PERIODS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
9. INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
10. ALTERNATIVE INTEREST RATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
PART 5
REPAYMENT, CANCELLATION AND PREPAYMENT . . . . . . . . . . . . . . . . . . 16
11. REPAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12. REDUCTION, CANCELLATION AND PREPAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
PART 6
CHANGE IN CIRCUMSTANCES . . . . . . . . . . . . . . . . . . . . . . 18
13. TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
14. TAX RECEIPTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
15. INCREASED COSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
16. ILLEGALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
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PART 7
REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT . . . . . . . . . . . . . . . . 21
17. REPRESENTATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
18. FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
19. FINANCIAL CONDITION AND SECURITY COVERAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
20 COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
21. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
PART 8
SPONSORS' OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . 36
22. SPONSORS' OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
PART 9
DEFAULT INTEREST AND INDEMNITY . . . . . . . . . . . . . . . . . . . . 37
23. DEFAULT INTEREST AND INDEMNITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
PART 10
PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . 39
24. CURRENCY OF ACCOUNT AND PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
25. PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
26. SET-OFF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
27. REDISTRIBUTION OF PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
PART 11
FEES, COSTS AND EXPENSES . . . . . . . . . . . . . . . . . . . . . . 42
28. FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
29. COSTS AND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
PART 12
AGENCY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . 43
30. THE AGENT AND THE BANKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
PART 13
ASSIGNMENT AND TRANSFERS . . . . . . . . . . . . . . . . . . . . . . 47
31. BENEFIT OF AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
32. ASSIGNMENTS AND TRANSFERS BY THE OBLIGORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
33 ASSIGNMENTS AND TRANSFERS BY BANKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
34. DISCLOSURE OF INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
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PART 14
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 50
35. CALCULATIONS AND EVIDENCE OF DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
36. REMEDIES AND WAIVERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
37. PARTIAL INVALIDITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
38. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
PART 15
LAW AND JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . 52
39. LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
40. JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
THE FIRST SCHEDULE 54
CONDITION PRECEDENT DOCUMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
THE SECOND SCHEDULE
NOTICE OF DRAWDOWN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
THE THIRD SCHEDULE
FORM OF TRANSFER CERTIFICATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
THE FOURTH SCHEDULE
THE ORIGINAL VESSELS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
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THIS AGREEMENT is made the 26th day of July, 1996
BETWEEN
(1) GULF OFFSHORE SHIPPING SERVICES, INC. (the "BORROWER");
(2) GULFMARK INTERNATIONAL, INC., GULFMARK NORTH SEA LIMITED, and GULF
OFFSHORE MARINE INTERNATIONAL, INC. (together the "SPONSORS" and each
a "SPONSOR");
(3) CHASE MANHATTAN INTERNATIONAL LIMITED as agent (the "AGENT") and
security trustee ("SECURITY TRUSTEE"); and
(4) THE CHASE MANHATTAN BANK (the "INITIAL BANK").
NOW IT IS HEREBY AGREED as follows:
PART 1
INTERPRETATION
1. INTERPRETATION
1.1 In this Agreement:
"ADVANCE" means, save as otherwise provided herein, an Advance made or to be
made by the Banks hereunder;
"ADDITIONAL MORTGAGED VESSEL" means any vessel, other than the Original
Vessels, owned by the Borrower subject to a first priority legal mortgage and a
deed of covenants collateral thereto (or documents conferring a similar
security interest), granted in favour of the Security Trustee as security,
INTER ALIA, for the obligations of the Borrower hereunder, which mortgage and
collateral deed of covenants (or such documents) have been duly registered,
recorded or filed as required by the Security Trustee and are in full force and
effect;
"APPROVED CHARTER" means any charterparty, contract or engagement of
affreightment or for the carriage or transportation of cargo, mail or
passengers or any of them, relating to any of the Mortgaged Vessels, whether
now existing or hereafter entered into by the Borrower or any person, firm or
company on its behalf, the terms of which are approved by the Agent;
"APPROVED CHARTER EARNINGS" in relation to a Mortgaged Vessel means the amount
of all freights and hires which may be earned by the Borrower during the term
of any Approved Charter pursuant to the terms and conditions thereof, LESS the
estimated cost of the Borrower during such term of maintaining and operating
the Mortgaged Vessel to which such Approved Charter relates in accordance with
the terms and
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conditions hereof and of the mortgage and/or deed of covenants relating to such
Mortgaged Vessel to and such Approved Charter;
"AVAILABLE AMOUNT" means the principal amount at any time available for drawing
under the Facility as computed by the Agent pursuant to Clause 7;
"AVAILABLE COMMITMENT" in relation to a Bank at any time means, save as
otherwise provided herein, its Commitment less its portion of each Advance
which has been made hereunder and is outstanding at such time;
"AVAILABLE FACILITY" means, at any time and save as otherwise provided herein,
the aggregate amount from time to time of the Available Commitments at such
time;
"BANKS" means the Initial Bank and its respective successors, any permitted
transferees or assigns which are for the time being participating in the
Facility;
"BENEFICIARIES" mean the Agent and the Banks;
"CHRISTIANIA MORTGAGES" means each of the mortgages over:
(a) the m.v. "HIGHLAND STAR";
(b) the m.v. "HIGHLAND PRIDE";
(c) the m.v. "HIGHLAND LEGEND";
(d) the m.v. "HIGHLAND PIPER"; and
(e) the m.v. "ATLANTIC WARRIOR",
securing the obligations of Gulf Offshore N.S. Limited in respect of loans (the
"CHRISTIANIA LOANS") made or to be made by Christiania Bank of Kreditkasse to
Gulf Offshore N.S. Limited on terms disclosed to and approved by the Agent
prior to the date hereof together with any deed of covenants (and/or such other
documents as may be executed assigning the earnings and insurance of any of
those vessels);
COMMITMENT" in relation to the Initial Bank at any time means, subject to the
provisions of Clause 12.1 and save as otherwise provided herein, the amount of
$7,000,000, the amount of any commitment transferred to it in accordance with
Clause 33 LESS any amount of its Commitment transferred by it in accordance
with Clause 33;
"DESIGNATED VESSEL" means a vessel which in the opinion of the Agent will,
forthwith upon the making of an Advance, become an Additional Mortgaged Vessel
and in respect of which the Agent has received each of the documents referred
to in Clause 6.2(ii) and 6.2(iii);
"ENVIRONMENTAL AFFILIATE" means in relation to a party an agent or employee of
that party or a person in a contractual relationship with that party, with
respect to any of the Mortgaged Vessels or its operation or its carriage of
cargo thereon whose acts or omissions have or will have a Material Adverse
Effect;
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"ENVIRONMENTAL APPROVALS" means any permit, licence, approval, ruling,
variance, exemption or other authorisation required under applicable
Environmental Laws;
"ENVIRONMENTAL CLAIM" means any and all enforcement, clean-up, removal or other
governmental or regulatory actions or orders instituted or completed pursuant
to any Environmental Laws or Environmental Approvals together with claims made
by any third party relating to damage, contribution, loss or injury, resulting
from any Release of Material of Environmental Concern;
"ENVIRONMENTAL LAWS" means all national, state, local, foreign and
international laws, regulations, treaties and conventions pertaining to the
pollution or protection of human health or the environment (including ambient
air, surface water, ground water, land surface or subsurface strata, navigable
waters, waters of the contiguous zone, ocean waters and international waters),
including laws, regulations, treaties and conventions relating to the Release
(or threatened release) of Material of Environmental Concern;
"EVENT OF DEFAULT" means any of those events specified in Clause 21.1;
"FACILITY" means the dollar revolving loan facility granted to the Borrower
pursuant to Clause 2;
"FACILITY AMOUNT" means $7,000,000;
"FACILITY OFFICE" in relation to the Agent or any Bank means the office
identified with its signature below or such other office as it may from time to
time select;
"FINAL MATURITY DATE" means 31 July 2001;
"FINANCE DOCUMENTS" means this Agreement, the Security Documents and all other
documents from time to time creating, evidencing or entered into as security
for, or guaranteeing the obligations of the Borrower hereunder or thereunder
and any document entered into pursuant hereto or thereby;
"FIXED ASSET INVESTMENT" means any investment which will in the reasonable
opinion of the Principal Sponsor increase the marketability of a Mortgaged
Vessel or any other vessel or is necessary to ensure the compliance by the
owner of such Vessel of all laws and regulations applicable to such Mortgaged
Vessel or any other vessel;
"FREELY AVAILABLE LIQUID RESOURCES" shall have the meaning ascribed thereto in
Clause 19.4;
"GMM GROUP" means the Sponsors (other than the Principal Sponsor), Gulf
Offshore N.S. Limited, Gulf Offshore Far East Inc. and subsidiaries for the
time being;
"GROUP" means the Principal Sponsor and its subsidiaries for the time being;
"INSTRUCTING GROUP" means;
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(i) before any Advance has been made hereunder, a group of Banks
whose Total Available Commitments amount in aggregate to more
than fifty one (51%) of the Total Available Facility; and
(ii) thereafter, a group of Banks to whom in aggregate more than
fifty one (51%) of the Loan is (or, immediately prior to its
repayment, was then) owed;
"INTEREST PERIOD" means, save as otherwise provided herein, any of those
periods mentioned in Clause 8.2.
"LIBOR" means, in relation to any Advance or unpaid sum, the rate per annum at
which the Agent was offering to prime banks in the London Interbank Market
deposits in the currency of and in an amount approximately equal to the amount
of such Advance or unpaid sum and for the specified period at or about 11.00
a.m. on the Quotation Date for such period and, for the purposes of this
definition, "SPECIFIED PERIOD" means the Interest Period of such Advance or, as
the case may be, the period in respect of which LIBOR falls to be determined in
relation to such unpaid sum;
"LOAN" means at any time the aggregate principal amount of all Advances for the
time being outstanding hereunder;
"MAIN FACILITY" means the facility agreement dated 8 July 1993, as amended by
the amendment agreement dated 20 May 1994 and 20 October 1995 and as amended,
varied, supplemented, extended or novated from time to time, and made between
GulfMark North Sea Limited, Gulf Offshore Marine International Inc. as
principal borrowers, Gulf Offshore N.S. Limited, as permitted borrowers, the
Principal Sponsor as sponsor, The Chase Manhattan Bank, N.A. as agent, security
trustee and hedge counterparty and others;
"MARGIN" means one point six two five per cent. (1.625%) per annum;
"MARKET VALUE" means, at any time, in relation to any Vessel, her sale value in
dollars as then most recently determined by an independent and internationally
recognised firm of shipbrokers acceptable to the Agent on the basis of a sale
of such Vessel (a) for cash (b) free of charter, liens, charges, mortgages and
encumbrances and (c) at arm's length on normal commercial terms between a
willing seller and a willing buyer;
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the ability of the
Borrower to meet its obligations to the Security Trustee, the Agent and the
Banks hereunder or under any of the Security Documents to which the Borrower is
a party;
"MATERIAL OF ENVIRONMENTAL CONCERN" means and includes pollutants,
contaminants, toxic substances, oil as defined in the United States Oil
Pollution Act of 1990, and all hazardous substances as defined in the United
States Comprehensive Environmental Response, Compensation and Liability Act;
"MORTGAGED VESSELS" means (a) each of the Original Vessels in respect of which
a first priority legal mortgage and deed of covenant or assignments collateral
thereto granted in favour of the Security Trustee
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is in full force and effect; and (b) each Additional Mortgaged Vessel and
"MORTGAGED VESSEL" means any of them;
"MORTGAGES" means the first priority mortgages (each as amended, varied,
novated, supplemented or extended from time to time and including, for the
avoidance of doubt, any addenda thereto) in favour of the Security Trustee to
be executed by the Borrower in favour of the Security Trustee over each of the
Original Vessels and each Additional Mortgaged Vessel;
"NOTICE OF DRAWDOWN" means a notice substantially in the form set out in the
Second Schedule;
"OBLIGORS" means the Sponsors and the Borrower;
"ORIGINAL FINANCIAL STATEMENTS" means the consolidated financial statements of
the Principal Sponsor and its subsidiaries for its financial year ended 31
December 1995;
"ORIGINAL VESSELS" means each of the vessels listed in the Fourth Schedule; and
"POTENTIAL EVENT OF DEFAULT" means any event which may become (with the passage
of time, the giving of notice, the making of any determination hereunder or any
combination thereof) an Event of Default;
"PRINCIPAL SPONSOR" means GulfMark International, Inc.;
"PROFITS AFTER TAX" means in respect of any financial year of any member of the
GMM Group, the profit after deduction of tax thereon of such member of the GMM
Group for such financial year determined by reference to the consolidated
profit and loss account of the GMM Group in respect of such financial year and
delivered to the Agent pursuant to Clause 18.1;
"QUOTATION DATE" means, in relation to any period for which an interest rate is
to be determined hereunder, the day on which quotations would ordinarily be
given by prime banks in the London Interbank Market for deposits in dollars for
delivery on the first day of that period Provided that, if for any such period
quotations would ordinarily be given on more than one date, the Quotation Date
for that period shall be the last of those dates;
"REDUCED AMOUNT" on any Reduction Date, and in relation to the Facility, means
the amount of the Facility as the same has been reduced on such Reduction Date
in accordance with the provisions of Clause 12.1;
"REDUCTION DATE" means 31 January 1997 and then each of the days which are 6,
12, 18, 24, 30, 36, 42, 48 and 54 months thereafter;
"RELEASE OF MATERIAL OF ENVIRONMENTAL CONCERN" means an emission, spill,
release or discharge into or upon (i) the air, (ii) surface water, (iii) ground
water or (iv) soils, of any Material of Environmental Concern for which any
member of the Group has any liability under Environmental Laws, except in
accordance with a valid Environmental Approval;
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"SECURITY DOCUMENTS" means:
(i) the first preferred Panamanian ship mortgage and
assignment of insurances and earnings collateral
thereto executed in respect of each of the Original
Vessels;
(ii) each of the mortgages and deed of covenants (and/or
such other documents as may be executed assigning the
earnings and insurances of any vessel) which may be
executed in respect of any vessel as security for the
obligations of the Borrower hereunder;
(iii) the Trust Agreement; and
(iv) the Share Pledge.
"SHARE PLEDGE" means the share pledge referred to in paragraph 5 of the First
Schedule;
"SHORT TERM FACILITY" means the short term facility agreement dated 8 July 1993
as amended by the amendment agreement dated 20 May 1994 and as amended, varied,
supplemented, extended or novated from time to time made between GulfMark North
Sea Limited, Gulf Offshore Marine International Inc., Gulf Offshore N.S.
Limited and Gulf Offshore Far East Inc., as borrowers, the Principal Sponsor,
as guarantor, and the Agent as lending bank;
"TRANSFER CERTIFICATE" means a certificate in the form set out in the Third
Schedule signed by a Bank and a Transferee whereby:
(a) such Bank seeks to procure the transfer to such Transferee of
all or a part of such Bank's rights and obligations hereunder
upon and subject to the terms and conditions set out in Clause
33; and
(b) such Transferee undertakes to perform the obligations it will
assume as a result of delivery of such certificate to the
Agent as is contemplated in Clause 33;
"TRANSFER DATE" in relation to any Transfer Certificate means the date for the
making of the transfer as specified in such Transfer Certificate;
"TRANSFEREE" means a bank or other financial institution to which a Bank seeks
to transfer all or part of such Bank's rights and obligations hereunder; and
"TRUST AGREEMENT" means the trust agreement referred to in paragraph 3 of the
First Schedule.
1.2 Any reference in this Agreement to:
the "AGENT", the "SECURITY TRUSTEE" or a "BANK" shall be construed so as to
include it and any subsequent successors in accordance with their respective
interests and "SUCCESSORS" in relation to a party means an assignee or
successor in title of such party or any person who, under the laws of its
jurisdiction
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of incorporation or domicile has assumed the rights and obligations of such
party hereunder or to which under such laws the same have been transferred;
a "BUSINESS DAY" shall be construed as a reference to a day (other than a
Saturday or Sunday) on which banks are generally open for business in London
and New York City;
a "CLAUSE" shall, subject to any contrary indication, be construed as a
reference to a clause hereof;
an "ENCUMBRANCE" shall be construed as a reference to a mortgage, charge,
pledge, lien or other encumbrance securing any obligation of any person or any
other type of preferential arrangement (including, without limitation, title
transfer and retention arrangements) having a similar effect;
the "EQUIVALENT" on any given date in one currency (the "FIRST CURRENCY") of an
amount denominated in another currency (the "SECOND CURRENCY") is a reference
to the amount of the first currency which could be purchased by the amount of
the second currency at the spot rate of exchange quoted by the Agent at or
about 11.00 a.m. on such date for the purchase of the first currency with the
second currency for delivery two business days thereafter;
a "HOLDING COMPANY" of a company or corporation shall be construed as a
reference to any company or corporation of which the first-mentioned company or
corporation is a subsidiary;
"INDEBTEDNESS" shall be construed so as to include any obligation (whether
incurred as principal or as surety) for the payment or repayment of money,
whether present or future, actual or contingent;
"INDEBTEDNESS FOR BORROWED MONEY" shall be construed so as to include, without
limitation, any indebtedness of any person for or in respect of:
(i) amounts raised by acceptance under any acceptance
credit facility;
(ii) amounts raised under any note purchase facility;
(iii) the amount of any liability in respect of leases or
hire purchase contracts which would, in accordance
with generally accepted accounting standards in the
United States and/or the United Kingdom (as used in
the Principal Sponsor's most recent audited annual
consolidated financial statements from time to time),
be treated as finance or capital leases;
(iv) the amount of any liability in respect of any
purchase price for assets or services the payment of
which is deferred for a period in excess of one
hundred and eighty days; and
(v) amounts raised under any other transaction
(including, without limitation, any forward sale or
purchase agreement) having the commercial effect of a
borrowing (excluding, for the avoidance of doubt,
indebtedness incurred in relation to commercial
transactions);
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a "MONTH" is a reference to a period starting on one day in a calendar month
and ending on the numerically corresponding day in the next succeeding calendar
month save that, where any such period would otherwise end on a day which is
not a business day, it shall end on the next succeeding business day, unless
that day falls in the calendar month succeeding that in which it would
otherwise have ended, in which case it shall end on the immediately preceding
business day Provided that, if a period starts on the last business day in a
calendar month or if there is no numerically corresponding day in the month in
which that period ends, that period shall end on the last business day in that
later month (and references to "MONTHS" shall be construed accordingly);
a "PERSON" shall be construed as a reference to any person, firm, company,
corporation, government, state or agency of a state or any association or
partnership (whether or not having separate legal personality) of two or more
of the foregoing;
"REPAY" (or any derivative form thereof) shall, subject to any contrary
indication, be construed to include "PREPAY" (or, as the case may be, the
corresponding derivative form thereof);
"REQUISITION COMPENSATION" means the sums of money or other compensation from
time to time payable or paid by any person in connection with or by reason of
requisition for title or other compulsory acquisition of the Vessels or either
of them otherwise than by requisition for hire;
"REQUISITION FOR TITLE" (as a verb) includes, in relation to an asset,
compulsorily acquire, expropriate, nationalise, seize, capture, forfeit,
condemn as prize or otherwise act so as to divest the owner thereof of title
thereto and noun forms of the verb shall be construed accordingly;
a "SCHEDULE" shall, subject to any contrary indication, be construed as a
reference to a schedule hereto;
a "SUBSIDIARY" of a company or corporation shall be construed as a reference to
any company or corporation:
(i) which is controlled, directly or indirectly, by the
first-mentioned company or corporation;
(ii) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(iii) which is a subsidiary of another subsidiary of the
first-mentioned company or corporation
and, for these purposes, a company or corporation shall be treated as being
controlled by another if that other company or corporation is able to direct
its affairs and/or to control the composition of its board of directors or
equivalent body;
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13
"TAX" shall be construed so as to include any tax, levy, impost, duty or other
charge of a similar nature (including, without limitation, any penalty or
interest payable in connection with any failure to pay or any delay in paying
any of the same);
"TOTAL LOSS" shall be construed in accordance with the provisions of the
relevant Security Document;
"VAT" shall be construed as a reference to value added tax including any
similar tax which may be imposed in place thereof from time to time;
a "WHOLLY-OWNED SUBSIDIARY" of a company or corporation shall be construed as a
reference to any company or corporation which has no other members except that
other company or corporation and that other company's or corporation's
wholly-owned subsidiaries or persons acting on behalf of that other company or
corporation or its wholly-owned subsidiaries; and
the "WINDING-UP", "DISSOLUTION" or "ADMINISTRATION" of a company or corporation
shall be construed so as to include any equivalent or analogous proceedings
under the law of the jurisdiction in which such company or corporation is
incorporated or any jurisdiction in which such company or corporation carries
on business including the seeking of liquidation, winding-up, reorganisation,
dissolution, administration, arrangement, adjustment, protection or relief of
debtors.
1.3 "L." and "STERLING" denote the lawful currency of the United Kingdom
and "$" and "DOLLARS" denote lawful currency of the United States of America.
1.4 Save where the contrary is indicated, any reference in this Agreement
to:
(i) this Agreement or any other agreement or document
shall be construed as a reference to this Agreement
or, as the case may be, such other agreement or
document as the same may have been, or may from time
to time be, amended, varied, novated or supplemented;
(ii) a statute shall be construed as a reference to such
statute as the same may have been, or may from time
to time be, amended or re-enacted; and
(iii) a time of day shall be construed as a reference to
London time.
1.5 Clause and Schedule headings are for ease of reference only.
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14
PART 2
THE FACILITY
2. THE FACILITY
The Xxxxx xxxxx to the Borrower through their respective Facility
Offices, subject to the provisions of Clauses 7 and 12 and otherwise upon the
terms and subject to the conditions hereof, a revolving loan facility in an
aggregate amount of up to $7,000,000.
3. PURPOSE
3.1 The Facility is intended to be applied in or towards the cost of
acquisition of the Original Vessels and for general working capital purposes.
3.2 Without prejudice to the obligations of the Borrower under Clause 3.1,
neither the Agent, the Banks nor any of them shall be obliged to concern
themselves with the application of amounts raised by the Borrower hereunder.
4. NATURE OF BANK'S OBLIGATIONS
4.1 The obligations of each Bank hereunder are several.
4.2 The failure by a Bank to perform its obligations hereunder shall not
affect the obligations of the Borrower to any other party hereto nor shall any
such other party be liable for the failure by such Bank to perform its
obligations hereunder.
5. CONDITIONS PRECEDENT
5.1 Save as the Agent may otherwise agree, the Borrower may not deliver
any Notice of Drawdown hereunder unless the Agent has confirmed to the
Principal Sponsor that it has received all of the documents listed in the First
Schedule and that each is, in form and substance, satisfactory to the Agent.
5.2 In respect of the documents referred to in paragraphs 4 and 5 of the
First Schedule (the "UNDATED SECURITY DOCUMENTS") the Agent agrees that they
are to be held in safe custody by it (or any sub-custodian as hereinafter
referred to) unless and until an Advance is made pursuant to Clause 6: in which
event the Agent shall when such Advance is made contemporaneously date, or
shall procure the contemporaneous dating of, the Undated Security Documents
referred to in paragraphs 4 and 5 of the First Schedule and shall then
endeavour to register (as soon as is reasonably practicable to do so) the
mortgages referred to in paragraphs 4 of the First Schedule on the Panamanian
Register of Ships. The Agent may place the Undated Security Documents with any
firm of lawyers of good repute and, in the absence of gross negligence or
wilful default on the part of the Agent, the Agent shall not be responsible for
any loss thereby incurred.
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15
5.3 The Agent shall not, in the absence of gross negligence or wilful
default on its part, be responsible for any loss, incurred by any person, if
for any reason it is not possible to put into effect any matter the subject of
Clause 5.2. The Borrower shall from time to time execute and sign all
documents which the Agent may reasonably require for effecting the registration
of the Undated Security Documents and, furthermore, the Borrower agrees not to
withdraw, or purport to withdraw, the Undated Security Documents from the
custody of the Agent (or any sub-custodian as hereinbefore referred to) except
with the prior written consent of the Agent.
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PART 3
AVAILABILITY OF THE FACILITY
6. AVAILABILITY OF THE FACILITY
6.1 Subject to the provisions of Clause 6.2 and save as otherwise provided
herein, an Advance will be made by the Banks to the Borrower if:
(i) not more than ten, nor less than three business days
before the proposed date for the making of such
Advance, the Agent has received from the Borrower a
notice of drawdown therefore, receipt of which shall
oblige the Borrower to borrow the amount therein
requested on the date therein stated upon the terms
and subject to the conditions herein;
(ii) the proposed date for the making of such Advance is a
business day which falls one or more months before
the Final Maturity Date;
(iii) the proposed amount of such Advance is (a) an amount
of not less than $1,000,000 which is an integral
multiple of $500,000 and which is less than the
Available Facility or (b) equal to, the amount of the
Available Facility;
(iv) the proposed amount of such Advance (less the amount
of any Advances falling to be repaid on or before the
proposed date for the making of such Advance) will
not result, when such Advance is made, in the Loan
exceeding the Available Amount;
(v) in the case of the initial Advance the Agent is
satisfied that the Original Vessels will be
transferred to the Borrower free from encumbrances
and first priority legal mortgages over each of the
Original Vessels will be duly registered, recorded
and filed immediately on the making thereof;
(vi) the interest rate applicable to such Advance during
its first Interest Period would not fall to be
determined pursuant to Clause 10.1;
(vii) the making of such Advance would not result in a
breach of the requirements of Clause 19.1; and
(viii) either:
(a) no Event of Default or Potential Event of
Default has occurred; and
(b) the representations set out in Clause 17 are
true on and as of the proposed date for the
making of such Advance,
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or the Banks agree (notwithstanding any matter
mentioned at (a) or (b) above) to make such Advance.
Provided always that if the Banks agree to make an Advance notwithstanding any
of the above, and the proceeds of such Advance are paid into an account with
The Chase Manhattan Bank or any of its subsidiaries or affiliates (the "DEPOSIT
HOLDING BANK"), the Deposit Holding Bank shall not be obliged to release such
proceeds from such account until the Agent is satisfied regarding compliance
with the above provisions and has confirmed such satisfaction to the Deposit
Holding Bank.
6.2 Save as the Agent may otherwise agree, other than in the case of the
initial Advance, the Borrower may not deliver a Notice of Drawdown hereunder in
respect of an Advance the availability of which is determined by reference to
the value of a Designated Vessel, unless the Agent has confirmed to the
Principal Sponsor that it has received in form and substance satisfactory to
it:-
(i) evidence that such Designated Vessel
(a) is, or will be, registered in the name of the
Borrower under a flag acceptable to the Agent, free
from all charters, contracts liens and encumbrances
other than in favour of the Security Trustee or in
terms acceptable to the Agent;
(b) is classified by the American Bureau of Shipping A1
AMS or to an equivalent classification acceptable to
the Agent; and
(c) is, or will be, insured in accordance with the deed
of covenants (and/or such other document as may be
executed assigning the insurances of such Designated
Vessel) referred to in Clause 6.2(ii);
(ii) a first priority mortgage in respect of such Designated Vessel
in favour of the Security Trustee; and
(iii) a deed of covenants (and/or such other document as may be
executed, assigning the earnings and insurances of such
Designated Vessel)
Provided that the documents referred to in Clause 6.2(ii) and (iii)
shall be left undated and held by the Agent on the terms and
conditions of Clause 5.2 and 5.3 mutatis mutandis.
7. DETERMINATION OF AVAILABLE AMOUNT
At any time "AVAILABLE AMOUNT" shall be an amount equal to the lesser
of (a) 51% of the aggregate amount of the Market Value of the Mortgaged Vessels
and (b) the Facility Amount Provided always that in calculating (a) the Agent
shall, in determining the Available Amount to ensure compliance with Clause
6.1(iv), treat any Designated Vessel by which the availability is to be
determined as a Mortgaged Vessel.
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PART 4
INTEREST
8. INTEREST PERIODS
8.1 The period for which an Advance is outstanding shall be divided into
successive periods each of which (other than the first) shall start on the last
day of the preceding such period.
8.2 The duration of each Interest Period shall, save as otherwise provided
herein, be one, three or six months, in each case as the Borrower may by not
less than five business days' prior notice to the Agent select Provided that:
(i) if the Borrower fails to give such notice of its
selection in relation to an Interest Period, the
duration of that Interest Period shall, subject to
paragraphs (ii) and (iii) below, be three months;
(ii) any Interest Period which begins during or at the
same time as any other Interest Period shall (if the
Advances to which those Interest Periods relate are
in the same currency) end at the same time as that
other Interest Period; and
(iii) any Interest Period which would otherwise end during
the month preceding, or extend beyond, a Reduction
Date or the Final Maturity Date shall be of such
duration that it shall end on such date.
9. INTEREST
9.1 On the last day of each Interest Period (and in the case of an
Interest Period of a duration of six months or more, on the expiry of each
period of three months during such Interest Period) the Borrower shall pay
accrued interest on the Advance to which such Interest Period relates.
9.2 The rate of interest applicable to an Advance from time to time during
an Interest Period relating thereto shall be the rate per annum which is the
sum of the Margin and LIBOR on the Quotation Date therefor.
10. ALTERNATIVE INTEREST RATES
10.1 If, in relation to an Advance at or about 11.00 a.m. on the Quotation
Date for an Interest Period in respect of such Advance:
(i) the Agent was not offering to prime banks in the
London Interbank Market deposits in the currency in
which such Advance is to be denominated for the
proposed duration of such Interest Period; or
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(ii) before the close of business in London on the
Quotation Date for such Interest Period, the Agent
has been notified by each of a group of Banks to whom
in aggregate fifty-one (51) per cent or more of the
aggregate amount of Advances denominated in the
currency of such Advance is (or, if an Advance were
then to be made, would be) owed that the rate at
which such deposits were being so offered does not
reflect the cost to it of obtaining such deposits,
then, notwithstanding the provisions of Clause 8:
(a) if paragraph (i) above applies the duration
of that Interest Period shall be one month
or, if less, such that it shall end on the
next succeeding Reduction Date or the Final
Maturity Date as the case may be; and
(b) the rate of interest applicable to each
Bank's portion of the Advance to which such
Interest Period relates from time to time
during such Interest Period shall be the rate
per annum which is the sum of the Margin and
the rate per annum notified to the Agent by
such Bank before the last day of such
Interest Period to be that which expresses as
a percentage rate per annum the cost to such
Bank of funding its portion of the Advance
during such Interest Period from whatever
sources it may reasonably select.
10.2 If (i) the event mentioned in paragraph (i) or (ii) in Clause 10.1
occurs or (ii) by reason of circumstances affecting the London Interbank Market
during any period of three consecutive business days the Agent was not offering
deposits in the currency in which an Advance is to be denominated to prime
banks in the London Interbank Market, then:
(i) the Agent shall notify the Banks, the Principal
Sponsor and the Borrower of such event;
(ii) if the Agent so requires, within five days of such
notification the Agent and the Principal Sponsor and
the Borrower shall enter into negotiations with a
view to agreeing a substitute basis (a) for
determining the rates of interest from time to time
applicable to the Advances and/or (b) upon which the
Advances may be maintained thereafter and any such
substitute basis that is agreed shall take effect in
accordance with its terms and be binding on each
party hereto; Provided Always that the Agent may not
agree any such substitute basis without the prior
consent of each Bank; and
(iii) if the Agent has required the Principal Sponsor and
the Borrower to enter into such negotiations, the
Agent may declare (any such declaration to be binding
on the Borrower) that each Advance shall become due
and payable on the last day of its then current
Interest Period unless by then a substitute basis has
been agreed upon in relation thereto.
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PART 5
REPAYMENT, CANCELLATION AND PREPAYMENT
11. REPAYMENT
11.1 The Borrower shall, on the Final Maturity Date, repay each Advance
then outstanding.
11.2 On each Reduction Date the Borrower shall repay the amount or amounts
by which, on that Reduction Date, the Advances then outstanding under the
Facility exceed the Reduced Amount of the Facility.
12. REDUCTION, CANCELLATION AND PREPAYMENT
12.1 The amount of the Facility shall be reduced on each of the Reduction
Dates by an amount equal to ten per cent. (10%) of the Facility Amount.
12.2 The Borrower may, by giving to the Agent not less than thirty days'
prior notice to that effect, cancel the whole or any part (being an amount or
integral multiple of $500,000) of the Facility. Any such cancellation shall
reduce the Available Commitment of the Banks rateably.
12.3 The Borrower may, if it has given to the Agent not less than ten
business days prior notice to that effect, prepay the whole of any Advance or
any part of any Advance (being an amount of not less than $1,000,000 and an
integral multiple of $500,000) on the last day of any Interest Period relating
to that Advance.
12.4 In the event any Mortgaged Vessel is sold or is or becomes or is
declared an actual or constructive or comprised or agreed total loss then the
Borrower shall apply the proceeds of sale or insurance proceeds or any
requisition compensation in respect thereof in repayment of any Advances then
outstanding, such repayment to be effected on the last day of the Interest
Period during which such proceeds are received or, if earlier, 120 days from
the date of total loss; PROVIDED ALWAYS that if any such proceeds of sale or
insurance proceeds are recovered or requisition compensation received other
than on the last day of any Interest Period the Agent shall, at the request of
the Borrower, retain such proceeds of sale or insurance proceeds or requisition
compensation, as the case may be, in a suspense account with interest accruing
thereon for the account of the Borrower at such rate as the Agent would pay in
the normal course of its business in respect of deposits of a like amount and
for a like term.
12.5 Any notice of cancellation or prepayment given by the Borrower
pursuant to Clause 12.2 or 12.3 shall be irrevocable, shall specify the date
upon which such cancellation or prepayment is to be made and the amount of such
cancellation or prepayment and, in the case of a notice of prepayment, shall
oblige the Borrower to make such prepayment on such date.
12.6 If any Bank claims indemnification from the Borrower under Clause 13.2
or Clause 15.1 and within thirty days thereafter the Agent receives from the
Borrower at least fifteen days' prior notice (which shall be irrevocable) of
the Borrower's intention to repay such Bank's share of the Advances then
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outstanding, the Borrower shall on the last day of each of the then current
Interest Period of each such Advance repay such Bank's portion of such
Advances.
12.7 A Bank for whose account a repayment is to be made under Clause 12.6
shall not be obliged to make any Advances hereunder on or after the date upon
which the Agent receives the Borrower's notice of their intention to repay such
Bank's share of the Advances then outstanding, on which date such Bank's
Available Commitment shall each be reduced to zero.
12.8 The Borrower shall not repay all or any part of any Advance except at
the times and in the manner expressly provided for in this Agreement, but,
shall subject to the terms and conditions hereof, be entitled to reborrow any
amount repaid.
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PART 6
CHANGE IN CIRCUMSTANCES
13. TAXES
13.1 All payments to be made by the Borrower to any person hereunder shall
be made free and clear of and without deduction for or on account of tax unless
the Borrower is required to make such a payment subject to the deduction or
withholding of tax, in which case the sum payable by the Borrower in respect of
which such deduction or withholding is required to be made shall be increased
to the extent necessary to ensure that, after the making of the required
deduction or withholding, such person receives and retains (free from any
liability in respect of any such deduction or withholding) a net sum equal to
the sum which it would have received and so retained had no such deduction or
withholding been made or required to be made.
13.2 Without prejudice to the provisions of Clause 13.1, if any person or
the Agent on its behalf is required to make any payment on account of tax (not
being a tax imposed on the net income of its Facility Office in the
jurisdiction in which it is incorporated or in which its Facility Office is
located) or otherwise on or in relation to any sum received or receivable by
such person or the Agent on its behalf hereunder (including, without
limitation, any sum received or receivable under this Clause 13) or any
liability in respect of any such payment is asserted, imposed, levied or
assessed against such person or the Agent on its behalf, the Borrower shall,
upon demand of the Agent, promptly indemnify such person against such payment
or liability, together with any interest, penalties and expenses payable or
incurred in connection therewith.
13.3 A Bank intending to make a claim pursuant to Clause 13.2, shall notify
the Agent of the event by reason of which it is entitled to make such claim
whereupon the Agent shall notify the Borrower and the Principal Sponsor thereof
Provided that nothing herein shall require any Bank to disclose any
confidential information relating to the organisation of its affairs.
14. TAX RECEIPTS
14.1 If, at any time, the Borrower is required by law to make any deduction
or withholding from any sum payable by it hereunder (or if thereafter there is
any change in the rates at which or the manner in which such deductions or
withholdings are calculated), the Borrower shall promptly notify the Agent.
14.2 If the Borrower makes any payment hereunder in respect of which it is
required to make any deduction or withholding, the Borrower shall pay the full
amount required to be deducted or withheld to the relevant taxation or other
authority within the time allowed for such payment under applicable law and
shall deliver to the Agent for each Bank, within thirty days after it has made
such payment to the applicable authority, an original receipt (or a certified
copy thereof) issued by such authority evidencing the payment to such authority
of all amounts so required to be deducted or withheld in respect of such
payment.
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15. INCREASED COSTS
15.1 If, by reason of (i) any change in law or in its interpretation or
administration and/or (ii) compliance with any request from or requirement of
any central bank or other fiscal, monetary or other authority (including,
without limitation, a request or requirement which affects the manner in which
a Bank or any holding company of such Bank is required to or does maintain
capital resources having regard to such Bank's obligations hereunder and to
amounts owing to it hereunder):
(a) a Bank or any holding company of such Bank incurs a cost as a
result of its having entered into and/or performing its
obligations under this Agreement and/or assuming or
maintaining a commitment under this Agreement and/or making
one or more Advances;
(b) a Bank or any holding company of such Bank is unable to obtain
the rate of return on its overall capital which it would have
been able to obtain but for its having entered into and/or
performing its obligations and/or assuming or maintaining a
commitment under this Agreement;
(c) there is any increase in the cost to a Bank or any holding
company of such Bank of funding or maintaining all or any of
the advances comprised in a class of advances formed by or
including the Advances; or
(d) a Bank or any holding company of such Bank becomes liable to
make any payment on account of tax or otherwise (not being a
tax imposed on the net income of its Facility Office by the
jurisdiction in which it is incorporated or in which its
Facility Office is located) on or calculated by reference to
the amount of the Advances and/or to any sum received or
receivable by it hereunder,
then the Borrower shall, from time to time on demand of the Agent, promptly pay
to the Agent for the account of that Bank amounts sufficient to indemnify that
Bank or any such holding company against, as the case may be, (1) such cost,
(2) such reduction in such rate of return (or such proportion of such reduction
as is, in the opinion of that Bank, attributable to its obligations hereunder),
(3) such increased cost (or such proportion of such increased cost as is, in
the opinion of that Bank, attributable to its funding or maintaining Advances)
or (4) such liability.
15.2 A Bank intending to make a claim pursuant to Clause 15.1, shall notify
the Agent of the event by reason of which it is entitled to do so whereupon the
Agent shall notify the Principal Sponsor thereof Provided that nothing herein
shall require any Bank to disclose any confidential information relating to the
organisation of its affairs.
16. ILLEGALITY
If, at any time, it is unlawful for a Bank to make, fund or allow to remain
outstanding all or any of the Advances, then that Bank shall, promptly after
becoming aware of the same, deliver to the Borrower through the Agent a
certificate to that effect and:
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(i) such Bank shall not thereafter be obliged to make any
Advances and the amount of its Available Commitment
shall be immediately reduced to zero; and
(ii) if the Agent on behalf of such Bank so requires, the
Borrower shall on such date as the Agent shall have
specified repay such Bank's share of each outstanding
Advance together with accrued interest thereon and
all other amounts owing to such Bank hereunder and
any repayment so made shall reduce rateably the
remaining obligations of the Borrower under Clause
11.
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PART 7
REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT
17. REPRESENTATIONS
17.1 Each Obligor represents that:
(i) it is a corporation duly organised under the laws of
its jurisdiction of incorporation with power to enter
into this Agreement and the Security Documents to
which it is a party and to exercise its rights and
perform its obligations hereunder and all corporate
and other action required to authorise its execution
of this Agreement and the Security Documents to which
it is a party and its performance of its obligations
hereunder has been duly taken;
(ii) under the laws of its jurisdiction of incorporation
in force at the date hereof, it will not be required
to make any deduction or withholding from any payment
it may make hereunder;
(iii) under the laws of its jurisdiction of incorporation
in force at the date hereof, the claims of the Agent
and the Banks against it under this Agreement and
under the Security Documents to which it is a party
will rank at least pari passu with the claims of all
its other unsecured creditors save those whose claims
are preferred solely by any bankruptcy, insolvency,
liquidation or other similar laws of general
application;
(iv) in any proceedings taken in its jurisdiction of
incorporation in relation to this Agreement and the
Security Documents to which it is a party, it will
not be entitled to claim for itself or any of its
assets immunity from suit, execution, attachment or
other legal process;
(v) in any proceedings taken in its jurisdiction of
incorporation in relation to this Agreement and any
of the Security Documents expressed to be governed by
English law, the choice of English law as the
governing law of this Agreement and such Security
Documents and any judgment obtained in England will
be recognised and enforced;
(vi) save for the registration of the Mortgages with the
appropriate authorities, all acts, conditions and
things required to be done, fulfilled and performed
in order (a) to enable it lawfully to enter into,
exercise its rights under and perform and comply with
the obligations expressed to be assumed by it in this
Agreement, (b) to ensure that the obligations
expressed to be assumed by it in this Agreement and
the Security Documents are legal, valid and binding
and (c) to make this Agreement and the Security
Documents admissible in evidence in its jurisdiction
of incorporation have been done, fulfilled and
performed;
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(vii) under the laws of its jurisdiction of incorporation
in force at the date hereof, it is not necessary that
this Agreement and the Security Documents, other than
the Mortgages, the Share Pledge and any deed of
covenant or assignment of earnings and insurance
collateral thereto be filed, recorded or enrolled
with any court or other authority in such
jurisdiction or that any stamp, registration or
similar tax be paid on or in relation to this
Agreement or any Security Document; and
(viii) the obligations expressed to be assumed by it in this
Agreement and the Security Documents to which it is a
party are its legal, valid and binding obligations.
17.2 Gulf Offshore Marine International, Inc. and GulfMark North Sea
Limited further represents that:
(i) no member of the Group has taken any corporate action
nor have any other steps been taken or legal
proceedings been started or (to the best of the
Borrower's knowledge and belief) threatened against
any member of the Group for its winding-up,
dissolution, administration or re-organisation or for
the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer
of it or of any or all of its assets or revenues;
(ii) no member of the Group is in breach of or in default
under any agreement to which it is a party or which
is binding on it or any of its assets to an extent or
in a manner which might have a Material Adverse
Effect on the business or financial condition of any
member of the Group;
(iii) no action or administrative proceeding of or before
any court or agency which might have a Material
Adverse Effect on the business or financial condition
of any member of the Group has been started or
threatened;
(iv) it and (to the best of its knowledge) its and the
Borrower's Environmental Affiliates have complied
with the provisions of all applicable Environmental
Laws, except where non-compliance does not and will
not have a Material Adverse Effect;
(v) it and (to the best of its knowledge) its and the
Borrower's Environmental Affiliates have obtained all
requisite Environmental Approvals and are in
compliance with such Environmental Approvals, except
where the failure to obtain or comply with any such
Environmental Approvals does not and will not have a
Material Adverse Effect;
(vi) neither it nor (to the best of its knowledge) its or
the Borrower's Environmental Affiliates has received
notice of any Environmental Claim that alleges that
it or any of its Environmental Affiliates are not in
compliance with applicable Environmental Laws or
Environmental Approvals, where such non-compliance
has or will have a Material Adverse Effect;
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(vii) there is no Environmental Claim against any member of
the Group pending or threatened, to the best of its
knowledge, that has or will have a Material Adverse
Effect;
(viii) there has been no Release of Material of
Environmental Concern except where such event does
not and will not have a Material Adverse Effect;
(ix) all of the written information supplied by any member
of the Group to the Agent and the Banks in connection
herewith is true, complete and accurate in all
material respects and it is not aware of any material
facts or circumstances that have not been disclosed
to the Agent and the Banks and which might, if
disclosed, adversely affect the decision of a person
considering whether or not to provide finance to the
Borrower;
(x) Gulf Offshore Marine International Inc. is directly
or indirectly, the sole legal and beneficial owner of
the entire share capital of the Borrower; and
(xi) save for the Christiania Mortgages, those
encumbrances created pursuant to the Main Facility
and the Short Term Facility and any encumbrance
created pursuant to the provisions of Clause
20.2(iii), no encumbrance exists over all or any of
the present or future revenues or assets of any
member of the Group.
17.3 Each Obligor further represents that:
(i) the execution by it of this Agreement and of each
Security Document to which it is a party and the
exercise of its rights and performance of its
obligations hereunder will not result in the
existence of nor oblige any member of the Group to
create any encumbrance over all or any of its present
or future revenues or assets: except, insofar as the
same may arise pursuant to the Security Documents;
(ii) the execution by it of this Agreement and the
exercise of its rights and performance of its
obligations hereunder do not and will not:
(a) conflict with any agreement, mortgage, bond
or other instrument or treaty to which it is
a party or which is binding upon it or any of
its assets;
(b) conflict with its constitutive documents and
rules and regulations; or
(c) conflict with any applicable law, regulation
or official or judicial order; and
(iii) the execution by it of this Agreement constitutes,
and the exercise of its rights and performance of its
obligations hereunder will constitute, private and
commercial acts done and performed for private and
commercial purposes.
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17.4 The Borrower represents that it, and each of the other parties thereto
are in compliance with all their obligations under each of the charters
relating to the Original Vessels (and any Additional Mortgaged Vessels) and
none of the parties to such charters have cancelled or repudiated or sought to
terminate, cancel or repudiate their obligations thereunder.
18. FINANCIAL INFORMATION
18.1 The Sponsors shall, and shall procure that the Borrower shall:
(i) as soon as the same become available, but in any
event within 120 days after the end of each of its
financial years, deliver to the Agent in sufficient
copies for the Banks the audited consolidated
financial statements of the Group and the Borrower
for such financial year;
(ii) as soon as the same become available, but in any
event within 60 days after the end of each of its
financial quarter years, deliver to the Agent in
sufficient copies for Banks the consolidated
financial statements of the Group, the Borrower and
the GMM Group for such period; and
(iii) from time to time on the request of the Agent,
furnish the Agent with such information about the
business and financial condition of the Group as the
Agent may reasonably require (including, but without
limitation, such further information as the Agent may
from time to time require in order to enable it to
ascertain where the obligations as set out in Clause
19 are complied with).
18.2 Each of the Sponsors and the Borrower shall ensure that:
(i) each set of financial statements delivered by it
pursuant to Clause 18.1 is prepared on the same basis
as was used in the preparation of its Original
Financial Statements and in accordance with
accounting principles generally accepted in the
United States and/or the United Kingdom and
consistently applied;
(ii) each set of financial statements delivered by it
pursuant to Clause 18.1 is certified by a duly
authorised officer of the Principal Sponsor as giving
a true and fair view of the financial condition of
the Group as at the end of the period to which those
financial statements relate and of the results of the
Group's operations during such period; and
(iii) each set of financial statements delivered by it
pursuant to paragraph (i) of Clause 18.1 has been
audited by auditors acceptable to the Agent.
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19. FINANCIAL CONDITION AND SECURITY COVERAGE
19.1 Each of Gulf Offshore Marine International Inc. and GulfMark North Sea
Limited shall ensure that at all times the consolidated financial condition of
the GMM Group, as evidenced by the Sponsors' then most recent audited annual
consolidated financial statements and in the case of paragraph (iv) below the
then most recent quarterly financial statements delivered pursuant to Clause
18.1(ii) (each as adjusted, as the Agent may consider appropriate, to take
account of any changes in circumstances which occur after the date as of which
such audited annual consolidated financial statements or, as the case may be,
quarterly financial statements, were prepared), shall be such that:
(i) the ratio of Current Assets to Current Liabilities
shall exceed 1.15:1;
(ii) the ratio of Total Liabilities to Tangible Equity
shall not exceed 1.75:1;
(iii) the aggregate of Tangible Equity and Subordinated
Debt shall be equal to or exceed $29,000,000;
(iv) for the twelve month period preceding the date as of
which such financial statements were prepared, the
ratio of Gross Revenues to Operating Expenses shall
be equal to or exceed 1.75:1.
19.2 Each of Gulf Offshore Marine International Inc. and GulfMark North Sea
Limited shall at all times ensure that Freely Available Liquid Resources exceed
$1,500,000.
19.3 The Borrower shall ensure at all times that the aggregate of:
(i) gross revenues received in respect of the charter,
lease or hire of any of the Mortgaged Vessels during
the preceding six months; and
(ii) the projected gross revenues from any unconditional
committed charter, lease or agreement to hire of any
of the Mortgaged Vessels for the succeeding six
months
shall be equal to or exceed $4,000,000.
19.4 In this Clause 19:
(i) "CURRENT ASSETS" means the aggregate of all of the
assets of each member of the GMM Group, other than
monies due or to become due from another member of
the GMM Group, which would, in accordance with
generally accepted accounting practice in the U.S.
consistently applied, be classified as current
assets, all as shown on the latest financial
statements delivered in accordance with Clause 18.1;
(ii) "CURRENT LIABILITIES" means at any particular time
the aggregate of the obligations of each member of
the GMM Group to pay money other than (a) repayment
obligations in respect of Advances made hereunder
falling due within a six month period from the date
at which such liabilities are calculated and (b)
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monies due or to become due to other members of the
GMM Group, which would, in accordance with generally
accepted accounting practice in the U.S. consistently
applied, be classified as current liabilities, all as
shown on the Principal Sponsor's latest financial
statements delivered in accordance with Clause 18.1;
(iii) "FREELY AVAILABLE LIQUID RESOURCES" means the
aggregate of any cash and deposits in any
jurisdiction from which funds are freely
transferable, denominated in freely convertible and
transferable currencies (placed in a prime bank or
reputable financial institution) then solely legally
and beneficially owned by the members of the GMM
Group and free from encumbrances;
(iv) "GROSS REVENUES" means in respect of the Borrower and
in respect of any period of time the aggregate of the
following items (all ascertained on a before tax
basis and without double counting):
(a) the revenues received or receivable by the
Borrower during such period in respect of the
charter, use or operation of any Mortgaged
Vessel;
(b) all compensation or other consideration
received or receivable by the Borrower during
such period from any person on account of any
requisition for hire of any Mortgaged Vessel;
(c) any and all proceeds of insurances relating
to revenue claims received or receivable by
the Borrower during such period in respect of
any Mortgaged Vessel;
(d) any other amounts received or receivable by
the Borrower during such period which the
Agent has agreed may be taken into account in
calculating the Gross Revenues for such
period,
(v) "OPERATING EXPENSES" means in respect of the Borrower
and in respect of any period of time the aggregate of
the following items (all ascertained on a before tax
basis and without double counting):
(a) all management fees paid or payable by the
Borrower during, or which are attributable
to, such period in connection with the
management of any of the Mortgaged Vessels;
and
(b) all administrative, operating and overhead
costs and expenses paid or payable by the
Borrower in connection with any of the
Mortgaged Vessels during, or which are
attributable to, such period (other than, for
the avoidance of doubt, items relating to
depreciation or amortisation),
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but only to the extent, in the case of (a) and (b)
hereof, that such items are non-capital items and are
deductible from revenues under generally accepted
accounting principles in the United States and/or the
United Kingdom consistently applied;
(vi) "TOTAL LIABILITIES" means at any particular time the
aggregate of the obligations of each member of the
GMM Group on a consolidated basis for the payment of
monies whether borrowed or not and whether due or to
become due which would, in accordance with generally
accepted accounting practice in the U.S. consistently
applied, be classified as liabilities (including, for
the avoidance of doubt, liabilities in respect of
lease or hire purchase contracts, contracts of
charter and contracts of guarantee), other than
monies due or to become due to any other member of
the GMM Group;
(vii) "TANGIBLE EQUITY" means at any particular time the
aggregate of the amounts paid up or credited as paid
up in respect of the share capital and the aggregate
amount of capital and reserves of the members of the
GMM Group including, but not limited to any credit
balance standing to the consolidated profit and loss
account of the GMM Group;
but deducting
(a) any debit balance standing to the
consolidated profit and loss account of the
GMM Group; and
(b) any intangible asset, including (for the
avoidance of doubt) goodwill
but shall exclude the cumulative amount of any
translation or transaction adjustments as required to
be deducted from or added to equity but excluded from
the determination of consolidated profit and loss in
accordance with accounting principles generally
accepted in the United States;
(viii) "SUBORDINATED DEBT" means any indebtedness of any
member of the GMM Group which is subordinated, in a
manner and to an extent satisfactory to the Agent, to
the indebtedness of the Borrower under this
Agreement, the Main Facility and the Short Term
Facility.
19.5 All expressions used in the definitions of this Clause 19 which are
not otherwise defined herein shall be construed in accordance with generally
accepted accounting principles in the United States of America (as used in the
Principal Sponsor's most recent audited annual consolidated financial
statements).
19.6 If the Agent at any time determines that the aggregate of the Market
Value of each of the Mortgaged Vessels as determined by reference to the most
up-to-date valuation of the Mortgaged Vessels delivered pursuant to the
provisions of Clause 20.1(v) is less than 175% of the aggregate amount of all
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Advances then outstanding (such requirement being the "REQUIRED SECURITY
COVERAGE") then the Borrower shall within ten business days after a request
therefor from the Agent either:
(a) prepay an amount of the Advance or Advances then outstanding which
shall be applied pro-rata in prepayment thereof, together with
interest thereon and any amounts falling due under Clause 23.4 as a
result of such prepayment; or
(b) provide additional security as may be acceptable to the Agent
such that the Required Security Coverage is met.
20 COVENANTS
20.1 Each of Gulf Offshore Marine International, Inc., Gulfmark North Sea
Limited and the Borrower shall:
(i) obtain, comply with the terms of and do all that is
necessary to maintain in full force and effect all
authorisations, approvals, licences and consents
required in or by the laws and regulations of its
jurisdiction of incorporation to enable it lawfully
to enter into and perform its obligations under this
Agreement and each of the Security Documents or to
ensure the legality, validity, enforceability or
admissibility in evidence in its jurisdiction of
incorporation of this Agreement and each of the
Security Documents;
(ii) without prejudice to the specific requirements of the
Security Documents procure that each member of the
GMM Group maintains insurances on and in relation to
its business and assets with reputable underwriters
or insurance companies against such risks and to such
extent as is usual for companies carrying on a
business such as that carried on by such member of
the GMM Group whose practice is not to self insure;
(iii) promptly inform the Agent of the occurrence of any
Event of Default or Potential Event of Default and,
upon receipt of a written request to that effect from
the Agent, confirm to the Agent that, save as
previously notified to the Agent or as notified in
such confirmation, no Event of Default or Potential
Event of Default has occurred;
(iv) without prejudice to the priority afforded by any
mortgage and deed of covenant or assignment
collateral thereto securing the obligations of the
Borrower hereunder ensure that at all times the
claims of the Agent and the Banks against the
Borrower under this Agreement rank at least pari
passu with the claims of all its other unsecured
creditors save those whose claims are preferred by
any bankruptcy, insolvency, liquidation or other
similar laws of general application;
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33
(v) at the request of the Agent, deliver to the Agent or
procure the delivery to the Agent of up- to-date
valuations of the Vessels prepared at the sole cost
and expense of the Borrower, showing the Market Value
of each of the Mortgaged Vessels;
(vi) ensure that the Mortgaged Vessels are maintained in
good working order and condition and in any event in
such condition as enables them to maintain the
classification American Bureau of Shipping A1 AMS or
to an equivalent classification acceptable to the
Agent free from all notations and recommendations
which have not been complied with within any
applicable time limit and ensure that such
classification is maintained;
(vii) comply with all applicable Environmental Laws
including, without limitation, requirements relating
to the establishment of financial responsibility (and
shall require that all Environmental Affiliates of
the Borrower comply with all applicable Environmental
Laws and obtain and comply with all required
Environmental Approvals, which Environmental Laws and
Environmental Approvals relate to any of the
Mortgaged Vessels or their operation or their
carriage of cargo), except where such non-compliance
does not or will not have a Material Adverse Effect;
(viii) upon the request of the Agent, conduct and complete
all investigations, studies, sampling, audits and
testings reasonably required by any known (or
threatened) Release of Material of Environmental
Concern that has or will have a Material Adverse
Effect;
(ix) promptly upon the occurrence of either of the
following events, provide to the Agent, or procure
that there is provided to the Agent, a certificate of
an officer of the Principal Sponsor specifying in
detail the nature of such event and the proposed
response of the Borrower or its Environmental
Affiliate concerned:
(a) the receipt by the Borrower or any
Environmental Affiliate (where the Borrower
has knowledge of such receipt) of any
Environmental Claim which has or will have a
Material Adverse Effect; or
(b) any actual or threatened Release of Material
of Environmental Concern which has or will
have a Material Adverse Effect,
and upon the written request by the Agent submit to
the Agent in sufficient copies for the Banks, at
reasonable intervals, a report updating the status of
any occurrence of an Environmental Claim or a Release
of Material of Environmental Concern, that has or
will have a Material Adverse Effect;
(x) maintain the registration of the Mortgaged Vessels
under the laws and flag of Panama (or such other flag
as the Banks may, at the request of the Borrower,
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34
from time to time to agree) and not cause or permit
to be done any act or omission whereby their
registration as such would or might be defeated or
imperilled or which might result in such Mortgaged
Vessels being required to be registered under any
other flag and registered with the appropriate
authorities;
(xi) permit the Agent on reasonable notice to inspect the
Mortgaged Vessels and their logs;
(xii) from time to time on being required to do so by the
Agent, do or procure the doing of all such acts and
execute or procure the execution of all such
documents as the Agent may reasonably consider
necessary for giving full effect to each of the
Security Documents or for securing to the Banks the
full benefit of the rights, powers and remedies
intended to be conferred upon the Agent or the
Security Trustee pursuant to the Security Documents;
(xiii) at all times ensure that Gulf Offshore Marine
International, Inc. is, subject to the rights
conferred by the Share Pledge, the sole beneficial
owner of the entire issued share capital of the
Borrower;
(xiv) commencing from the date hereof and thereafter no
later than 14 days from and inclusive of each of 30
September, 31 December, 31 March and 30 June deliver
to the Agent in sufficient copies for the Banks a
schedule in form and substance satisfactory to the
Agent detailing Fixed Asset Investments exceeding
$50,000 made by the Borrower in the three months
proceeding the date upon which such schedule is
delivered (whether such Fixed Asset Investment was
made with the consent of the Banks or pursuant to the
exception for such consent set out in Clause 20.2(x))
(xv) no later than 14 days from and inclusive of 31 March,
30 June, 30 September and 31 December in each
calendar year, furnish the Agent in sufficient copies
for the Banks with a report in form and substance
satisfactory to the Agent and at the cost of the
Borrower, relating to the status, employment,
earnings and location of the Mortgaged Vessels as at
the date upon which such report is furnished in
respect of the period elapsing since the previous
such report, if any; and
(xvi) forthwith upon the request of the Agent, charge,
pledge or otherwise encumber in favour of the
Security Trustee pursuant to a security document in
form and substance satisfactory to the Agent any
account into which Approved Charter Earnings are
paid.
20.2 The Borrower shall not without the prior written consent of an
Instructing Group:
(i) make or declare any dividend or other distribution in
respect of any financial year;
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35
(ii) incur expenditure in respect of any management fees
payable other than management fees payable to the
Principal Sponsor or Gulf Offshore Marine
International, Inc. in such amount as the Agent may
agree, having regard to the annual budget and
operating expenses of the Principal Sponsor or Gulf
Offshore Marine International, Inc.;
(iii) create or permit to subsist any encumbrance over all
or any of its present or future revenues or assets
except:-
(a) pursuant to the Security Documents; or
(b) any encumbrance imposed by law, such as
carrier's, warehouseman's, mechanics' liens,
crew's wages and master's disbursements and
other similar liens arising in the ordinary
course of business or permitted under the
terms of the Security Documents; or
(c) any encumbrance over assets acquired after
the date hereof and which encumbrance is in
existence prior to such acquisition or is
created in order to secure indebtedness
incurred in respect of such acquisition;
(iv) make any loans, grant any credit (save in the
ordinary course of business) or give any guarantee or
indemnity (except as required hereby) to or for the
benefit of any person or otherwise voluntarily assume
any liability, whether actual or contingent, in
respect of any obligation of any other person;
(v) issue any further shares or alter any rights
attaching to its issued shares in existence at the
date hereof;
(vi) save as otherwise provided herein (disregarding sales
of stock in trade in the ordinary course of business
and sales of Mortgaged Vessels or other assets for
amounts not less than eighty per cent. of the Market
Value of such Mortgaged Vessel) sell, lease, transfer
or otherwise dispose of, by one or more transactions
or series of transactions (whether related or not),
the whole or any part (the book value of which is
thirty per cent. or more of the book value of the
whole) of its revenues or its assets;
(vii) incur any indebtedness for borrowed money other than
pursuant to this Facility in excess of $50,000 or its
equivalent in other currencies; save to the extent
that such indebtedness is owed to other members of
the Group and is subordinated to the obligations of
the Borrower hereunder, and under each of the
Security Documents to which it is a party, on terms
acceptable to the Agent or is secured by encumbrances
of the nature referred to in Clause 20.2(iii)(c);
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(viii) carry on or engage in or be concerned with any
business or activities except insofar as they relate
to the ownership and operation of the Mortgaged
Vessels and other vessels engaged in similar
activities and activities relating thereto;
(ix) merge, demerge or consolidate with any person;
(x) make Fixed Asset Investment or acquire any shares
without the Banks' consent save insofar as such
investment or acquisition relates to the existing
activities of the Mortgaged Vessels and does not,
when aggregated with any other such investment or
acquisition made pursuant to this exception, exceed
$200,000; or
(xi) enter into any charterparty or contract or engagement
of affreightment in respect of any Mortgaged Vessel
or Designated Vessel other than an Approved Charter
save that any charterparty or contract or engagement
of affreightment having a duration of less than six
months (including any possible extension periods)
shall be deemed as having been approved automatically
by the Agent.
20.3 The Principal Sponsor shall at all times remain, subject to such
rights as may be conferred by the share pledges granted pursuant to the terms
of the Main Facility, the sole beneficial owner free from all encumbrances, of
the entire issued share capital of each member of the GMM Group.
20.4 The Sponsors shall not, save with the consent of the Agent or pursuant
to the Short Term Facility or the Main Facility, give any guarantee or
indemnity to or for the benefit of any person or otherwise voluntarily assume
any liability, whether actual or contingent, in respect of any obligation of
any other person Provided always that this Clause 20.4 shall not apply to (i)
the guarantee issued by the Principal Sponsor in favour of the Southwest Bank
of Texas N.A. in respect of indebtedness incurred by Ercon Development Co.
("ERCON") up to a maximum aggregate principal amount of $500,000, (ii) any bid
or performance bond issued by the Principal Sponsor at the request of Ercon up
to a maximum aggregate amount of $500,000 or (iii) the guarantees issued by
GulfMark North Sea Limited and Gulf Offshore Marine International, Inc. under
the Christiania Loans.
21. EVENTS OF DEFAULT
21.1 If:
(i) the Borrower fails to pay any sum due from it
hereunder or any Security Document at the time, in
the currency and in the manner specified herein or
therein or if such failure results solely from
technical or administrative difficulties relating to
the transfer of such sums, such failure is not
remedied within three days;
(ii) any representation or statement made by the Obligors,
or any of them, in this Agreement or under any
Security Document or in any notice or other document,
certificate or statement delivered by it pursuant
hereto or thereto or in connection herewith is or
proves to have been incorrect or misleading when
made; or
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(iii) any of the Obligors fails duly to perform or comply
with any of the obligations expressed to be assumed
by it in Clauses 18, 19 or 20 hereof or duly to
effect insurance of the Mortgaged Vessels or any of
them in accordance with the applicable provisions of
the Security Documents; or
(iv) any of the Obligors fails duly to perform or comply
with any other obligation expressed to be assumed by
it in this Agreement or under any Security Document
and such failure is not remedied within fourteen days
after the Agent has given notice thereof to such
Obligor; or
(v) the Borrower is in breach of any of its obligations
under any of the Approved Charters or the Borrower
seeks to cancel, terminate or repudiate any of the
Approved Charters without the prior consent of the
Agent; or
(vi) any indebtedness of any Obligor or any member of the
GMM Group (other than indebtedness due to trade
creditors incurred in the normal course of business
of such Obligor or such member of the GMM Group which
is disputed in good faith and by appropriate
proceedings diligently conducted) is not paid when
due or within any applicable grace period, any
indebtedness of any Obligor or any member of the GMM
Group is declared to be or otherwise becomes due and
payable prior to its specified maturity or any
creditor or creditors of any Sponsors or any member
of the GMM Group become entitled to declare any
indebtedness of any Obligor or such member of the GMM
Group due and payable prior to its specified
maturity; or
(vii) in any period of twelve months commencing from the
date hereof any judgments or judicial orders or
arbitration awards are made against the Borrower in
an amount or an aggregate amount in excess of
$750,000 (or the equivalent in any other currency)
(other than any judgment, judicial order or
arbitration award as to which, and only to the extent
that, a reputable company or other surety, in either
case acceptable to the Agent, has acknowledged
coverage of such judgment, judicial order or
arbitration award in writing) and,
(a) any such judgment, judicial order or
arbitration award has not been stayed,
discharged, paid, bonded or vacated within 30
days or such longer period as may be agreed
by the Agent; or
(b) enforcement proceedings have been commenced
by any creditor on any such judgment,
judicial order or arbitration award;
(viii) any Obligor or any member of the GMM Group is unable
to pay its debts as they fall due, commences
negotiations with any one or more of its creditors
with a view to the general readjustment or
rescheduling of its indebtedness or makes a general
assignment for the benefit of or a composition with
its creditors; or
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(ix) (otherwise than for the purpose of a reconstruction
on terms previously approved by the Agent) any
Obligor or any member of the GMM Group takes any
corporate action or other steps are taken or legal
proceedings are started for its winding-up,
dissolution, administration or re-organisation or for
the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer
of it or of any or all of its revenues and assets; or
(x) any execution or distress is levied against, or an
encumbrancer takes possession of the whole or any
material part of, the property, undertaking or assets
of any of the Obligors or any member of the GMM
Group; or
(xi) by or under the authority of any government, (a) the
management of any of the Obligors or any member of
the GMM Group is wholly or partially displaced or the
authority of any of the Obligors or any member of the
GMM Group in the conduct of its business is wholly or
partially curtailed or (b) all or a majority of the
issued shares of any of the Obligors or any member of
the GMM Group or the whole or any part (the book
value of which is twenty per cent. or more of the
book value of the whole) of its revenues or assets is
seized, nationalised, expropriated or compulsorily
acquired; or
(xii) subject to the rights conferred by the Share Pledge,
Gulf Offshore Marine International Inc. ceases to be
the sole legal and beneficial owner of the entire
share capital of the Borrower; or
(xiii) subject to the rights conferred by the Share Pledge,
the Principal Sponsor ceases to be the beneficial
owner of the entire issued share capital of each
member of the GMM Group;
(xiv) any member of the GMM Group ceases to carry on the
business it carries on at the date hereof or enters
into any new type of business; or
(xv) any Obligor repudiates this Agreement or any Security
Document to which it is a party or does or causes to
be done any act or thing evidencing an intention to
repudiate this Agreement or any such Security
Document; or
(xvi) at any time any act, condition or thing required to
be done, fulfilled or performed in order (a) to
enable any Obligor lawfully to enter into, exercise
its rights under and perform the obligations
expressed to be assumed by it in this Agreement and
the Security Documents to which it is a party, (b) to
ensure that the obligations expressed to be assumed
by any Obligor in this Agreement and the Security
Documents to which it is a party are legal, valid and
binding or (c) to make this Agreement and the
Security Documents to which it is a party admissible
in evidence in the Borrower's jurisdiction of
incorporation is not done, fulfilled or performed; or
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(xvii) at any time any of the security interests constituted
by any of the Security Documents ceases to constitute
valid and perfected first priority security
interests;
(xviii) at any time it is or becomes unlawful for any Obligor
to perform or comply with any or all of its
obligations hereunder or under any of the Security
Documents to which it is a party or any of the
obligations of any Obligor hereunder or under any of
the Security Documents to which it is a party are not
or cease to be legal, valid and binding; or
(xix) (a) any circumstances arise which give grounds in the
reasonable opinion of the Agent for belief that any
Obligor may not (or may be unable to) perform or
comply with its obligations hereunder, or any of the
Security Documents to which it is a party (b) the
Agent shall have given to the Principal Sponsor
notice that it is of such opinion setting out in
reasonable detail the grounds upon which such opinion
is based and (c) after having given due regard to any
representation made by the Obligors during the period
of ten days after the giving of such notice by the
Agent, the Agent is of the same opinion upon the
expiration of such period,
then, and in any such case and at any time thereafter, the Agent may (and, if
so instructed by an Instructing Group, shall) by written notice to the
Principal Sponsor and the Borrower:
(a) declare the Advances to be immediately due and payable
(whereupon the same shall become so payable together with
accrued interest thereon and any other sums then owed by the
Borrower hereunder) or declare the Advances to be due and
payable on demand of the Agent; and/or
(b) declare that any undrawn portion of the Facility shall be
cancelled, whereupon the same shall be cancelled and the
Available Facility shall be reduced to zero.
21.2 If, pursuant to Clause 21.1, the Agent declares the Advances to be due
and payable on demand of the Agent, then, and at any time thereafter, the Agent
may by written notice to the Principal Sponsor and the Borrower:
(i) call for repayment of the Advances on such date as it
may specify in such notice (whereupon the same shall
become due and payable on such date together with
accrued interest thereon and any other sums then owed
by the Borrower hereunder) or withdraw its
declaration with effect from such date as it may
specify in such notice; and/or
(ii) select as the duration of any Interest Period which
begins whilst such declaration remains in effect a
period of six months or less.
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PART 8
PRINCIPAL SPONSOR'S OBLIGATIONS
22. PRINCIPAL SPONSOR'S OBLIGATIONS
For the avoidance of doubt, the obligations of the Principal Sponsor herein
contained shall not constitute a guarantee of the obligations of the Borrower,
but shall be limited to a liability in damages arising out of or in connection
with any breach by the Principal Sponsor of the representations, covenants or
undertakings on its part contained herein.
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PART 9
DEFAULT INTEREST AND INDEMNITY
23. DEFAULT INTEREST AND INDEMNITY
23.1 If any sum due and payable by the Borrower hereunder is not paid on
the due date therefor in accordance with the provisions of Clause 25 or if any
sum due and payable by the Borrower under any judgment of any court in
connection herewith is not paid on the date of such judgment, the period
beginning on such due date or, as the case may be, the date of such judgment
and ending on the date upon which the obligation of the Borrower to pay such
sum (the balance thereof for the time being unpaid being herein referred to as
an "UNPAID SUM") is discharged shall be divided into successive periods, each
of which (other than the first) shall start on the last day of the preceding
such period and the duration of each of which shall (except as otherwise
provided in this Clause 23) be selected by the Agent.
23.2 During each such period relating thereto as is mentioned in Clause
23.1 an unpaid sum shall bear interest at the rate per annum which is the sum
from time to time of one per cent., the Margin and LIBOR on the Quotation Date
therefor Provided that:
(i) if, for any such period, LIBOR cannot be determined,
the rate of interest applicable to such unpaid sum
shall be the sum from time to time of one per cent.,
the Margin and the rate per annum equal to the cost
to the Agent of funding such unpaid sum for such
period from whatever source it may select; and
(ii) if such unpaid sum is all or part of the Advance
which became due and payable on a day other than the
last day of an Interest Period relating thereto, the
first such period applicable thereto shall be of a
duration equal to the unexpired portion of that
Interest Period and the rate of interest applicable
thereto from time to time during such period shall be
that which exceeds by one per cent. the rate which
would have been applicable to it had it not so fallen
due.
23.3 Any interest which shall have accrued under Clause 23.2 in respect of
an unpaid sum shall be due and payable and shall be paid by the Borrower at the
end of the period by reference to which it is calculated or on such other date
or dates as the Agent may specify by written notice to the Borrower.
23.4 If any Bank or the Agent on its behalf receives or recovers all or any
part of such Bank's share of an Advance otherwise than on the last day of an
Interest Period relating to that Advance, the Borrower shall pay to the Agent
on demand for account of such Bank an amount equal to the amount (if any) by
which (i) the additional interest which would have been payable on the amount
so received or recovered had it been received or recovered on the last day of
that Interest Period exceeds (ii) the amount of interest which in the opinion
of the Agent would have been payable to the Agent on the last day of that
Interest Period in respect of a dollar deposit equal to the amount so received
or recovered placed by it with a prime bank in London for a period starting on
the third business day following the date of such receipt or recovery and
ending on the last day of that Interest Period.
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23.5 The Borrower undertakes to indemnify:
(i) each of the Agent and the Banks against any cost,
claim, loss, expense (including legal fees) or
liability together with any VAT thereon, which it may
sustain or incur as a consequence of the occurrence
of any Event of Default or any default by the
Borrower in the performance of any of the obligations
expressed to be assumed by it in this Agreement; and
(ii) each Bank against any loss it may suffer as a result
of its funding an Advance requested by the Borrower
hereunder but not made by reason of the operation of
any one or more of the provisions hereof.
23.6 Any unpaid sum shall (for the purposes of this Clause 23 and Clause
15.1) be treated as an advance and accordingly in this Clause 23 and Clause
15.1 the term "Advance" includes any unpaid sum and the term "Interest Period",
in relation to an unpaid sum, includes each such period relating thereto as is
mentioned in Clause 23.1.
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PART 10
PAYMENTS
24. CURRENCY OF ACCOUNT AND PAYMENT
24.1 Dollars is the currency of account and payment for each and every sum
at any time due from the Borrower hereunder Provided that:
(i) each payment in respect of costs and expenses shall
be made in the currency in which the same were
incurred; and
(ii) each payment pursuant to Clause 13.2 or Clause 15.1
shall be made in the currency specified by the Bank
to whom such payment is to be made.
24.2 If any sum due from any of the Borrower under this Agreement or any
order or judgment given or made in relation hereto has to be converted from the
currency (the "FIRST CURRENCY") in which the same is payable hereunder or under
such order or judgment into another currency (the "SECOND CURRENCY") for the
purpose of (i) making or filing a claim or proof against the Borrower, (ii)
obtaining an order or judgment in any court or other tribunal or (iii)
enforcing any order or judgment given or made in relation hereto, the Borrower
shall indemnify and hold harmless each of the persons to whom such sum is due
from and against any loss suffered as a result of any discrepancy between (a)
the rate of exchange used for such purpose to convert the sum in question from
the first currency into the second currency and (b) the rate or rates of
exchange at which such person may in the ordinary course of business purchase
the first currency with the second currency upon receipt of a sum paid to it in
satisfaction, in whole or in part, of any such order, judgment, claim or proof.
25. PAYMENTS
25.1 On each date on which this Agreement or any of the Security Documents
requires an amount to be paid by any of the Borrower or any of the Banks, the
Borrower or, as the case may be, such Bank shall make the same available to the
Agent by payment in dollars and in same day funds (or in such other funds as
may for the time being be customary in New York City for the settlement in New
York City of international banking transactions in dollars) to The Chase
Manhattan Bank, New York, N.Y. for the account of Chase Manhattan International
Limited, London (Swift Code XXXXXX00 account number 544-7-14108) (or such other
account or bank as the Agent may have specified for this purpose).
25.2 If, at any time, it shall become impracticable (by reason of any
action of any governmental authority or any change in law, exchange control
regulations or any similar event) for the Borrower to make any payments
hereunder in the manner specified in Clause 25.1, then the Borrower may agree
with each or any of the Banks alternative arrangements for such payments to be
made Provided that, in the absence of any such agreement with any Bank, the
Borrower shall be obliged to make all payments due to such Bank in the manner
specified herein. Upon reaching such agreement the Borrower and such Bank
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shall immediately notify the Agent thereof and shall thereafter promptly notify
the Agent of all payments made direct to such Bank.
25.3 Save as otherwise provided herein, each payment received by the Agent
for the account of another person pursuant to Clause 25.1 shall be made
available by the Agent to such other person (in the case of a Bank, for the
account of its Facility Office) for value the same day by transfer to such
account of such bank in the principal financial centre of the country of the
currency of such payment as such person shall have previously notified to the
Agent.
25.4 All payments required to be made by the Borrower hereunder shall be
calculated without reference to any set-off or counterclaim and shall be made
free and clear of and without any deduction for or on account of any set-off or
counterclaim.
25.5 Where a sum is to be paid hereunder to the Agent for account of
another person, the Agent shall not be obliged to make the same available to
that other person until it has been able to establish to its satisfaction that
it has actually received such sum, but if it does so and it proves to be the
case that it had not actually received such sum, the person to whom such sum
was so made available shall on request refund the same to the Agent together
with an amount sufficient to indemnify the Agent against any cost or loss it
may have suffered or incurred by reason of its having paid out such sum prior
to its having received such sum.
26. SET-OFF
The Borrower authorises each Bank to apply any credit balance to which the
Borrower is entitled on any account of the Borrower with that Bank in
satisfaction of any sum due and payable from the Borrower to such Bank
hereunder but unpaid; for this purpose, each Bank is authorised to purchase
with the moneys standing to the credit of any such account such other
currencies as may be necessary to effect such application. No Bank shall be
obliged to exercise any right given to it by this Clause 26.
27. REDISTRIBUTION OF PAYMENTS
27.1 If, at any time, the proportion which a Bank (a "RECOVERING BANK") has
received or recovered (whether by payment, the exercise of a right of set-off
or combination of accounts or otherwise) in respect of its portion of any
payment (a "RELEVANT PAYMENT") to be made under this Agreement by the Borrower
for account of such Recovering Bank and the other Bank is greater (the portion
of such receipt or recovery giving rise to such excess proportion being herein
called an "EXCESS AMOUNT") than the proportion thereof so received or recovered
by the Bank so receiving or recovering the smallest proportion thereof, then:
(i) such Recovering Bank shall pay to the Agent an amount
equal to such excess amount;
(ii) there shall thereupon fall due from the Borrower to
such Recovering Bank an amount equal to the amount
paid out by such Recovering Bank pursuant to
paragraph (i) above, the amount so due being, for the
purposes hereof, treated
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as if it were an unpaid part of such Recovering
Bank's portion of such relevant payment; and
(iii) the Agent shall treat the amount received by it from
such Recovering Bank pursuant to paragraph (i) above
as if such amount had been received by it from the
Borrower in respect of such relevant payment and
shall pay the same to the persons entitled thereto
(including such Recovering Bank) pro rata to their
respective entitlements thereto.
27.2 If any sum (a "RELEVANT SUM") received or recovered by a Recovering
Bank in respect of any amount owing to it by the Borrower becomes repayable and
is repaid by such Recovering Bank, then:
(i) each Bank which has received a share of such relevant
sum by reason of the implementation of Clause 27.1
shall, upon request of the Agent, pay to the Agent
for the account of such Recovering Bank an amount
equal to its share of such relevant sum; and
(ii) there shall thereupon fall due from the Borrower to
each such Bank an amount equal to the amount paid out
by it pursuant to paragraph (i) above, the amount so
due being, for the purposes hereof, treated as if it
were the sum payable to such Bank against which such
Bank's share of such relevant sum was applied.
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PART 11
FEES, COSTS AND EXPENSES
28. FEES
28.1 The Borrower shall pay to the Agent for the account of the Banks a
commitment commission on the amount of each of the Available Facility from day
to day during the period beginning on the date hereof and ending on the Final
Maturity Date, such commitment commission to be calculated at the rate of three
quarters of one per cent. per annum and payable in arrear on the last day of
each successive period of three months which ends during such period and on the
Final Maturity Date.
28.2 The Borrower shall pay to the Agent for the account of the Banks an
arrangement fee equal to one and a half per cent. (1.5%) of the Facility Amount
upon the earlier of the date of drawdown of the first Advance made hereunder
and the date being thirty days after the date of this Agreement.
29. COSTS AND EXPENSES
29.1 The Borrower shall, from time to time on demand of the Agent,
reimburse the Agent for all costs and expenses (including legal fees,
travelling and accommodation and other reasonable out of pocket expenses)
together with any VAT thereon incurred by it in connection with the
negotiation, preparation and execution of this Agreement and the completion of
the transactions herein contemplated.
29.2 The Borrower shall, from time to time on demand of the Agent,
reimburse the Agent and all the Banks for all costs and expenses (including
legal fees) together with any VAT thereon incurred in or in connection with the
preservation and/or enforcement of any of the rights of the Agent, the Security
Trustee and the Banks under this Agreement.
29.3 The Borrower shall pay all stamp, registration and other taxes to
which this Agreement or any judgment given in connection herewith is or at any
time may be subject and shall, from time to time on demand of the Agent,
indemnify the Agent, the Security Trustee and the Banks against any
liabilities, costs, claims and expenses resulting from any failure to pay or
any delay in paying any such tax.
29.4 If the Borrower fails to perform any of its obligations under this
Clause 29, each Bank shall, in the proportion borne by its share of the Loan
(or, if no Advances have been made, its Available Commitment) to the amount of
the Loan (or, if no Advances have been made, the Available Facility) for the
time being (or, if the Loan has been repaid in full, immediately prior to the
final repayment thereof), indemnify the Agent against any loss incurred by any
of them as a result of such failure and the Borrower shall forthwith reimburse
each Bank for any payment made by it pursuant to this Clause 29.4.
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PART 12
AGENCY PROVISIONS
30. THE AGENT AND THE BANKS
30.1 Each Bank hereby appoints the Agent to act as its agent in connection
herewith and authorises the Agent to exercise such right, powers and
discretions as are specifically delegated to the Agent by the terms hereof
together with all such rights, powers and discretions as are reasonably
identical thereto.
30.2 The Agent may:
(i) assume that:
(a) any representation made by an Obligor in
connection herewith is true;
(b) no event which is or may become an Event of
Default has occurred; and
(c) no Obligor is in breach of or default under
its obligations hereunder
unless it has actual knowledge or actual notice to
the contrary;
(ii) assume that the Facility Office of each Bank is that
identified with its signature below until it has
received from such Bank a notice designating some
other office of such Bank to replace its Facility
Office and act upon any such notice until the same is
superseded by a further such notice;
(iii) engage and pay for the advice or services of any
lawyers, accountants, surveyors or other experts
whose advice or services may to it seem necessary,
expedient or desirable and rely upon any advice so
obtained;
(iv) rely as to any matters of fact which might reasonably
be expected to be within the knowledge of any of the
Obligors upon a certificate signed by or on behalf of
the Obligors.
(v) rely upon any communication or document believed by
it to be genuine;
(vi) refrain from exercising any right, power or
discretion vested in it as agent hereunder unless and
until instructed by an Instructing Group as to
whether or not such right, power or discretion is to
be exercised and, if it is to be exercised, as to the
manner in which it should be exercised; and
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(vii) refrain from acting in accordance with any
instructions of an Instructing Group to begin any
legal action or proceeding arising out of or in
connection with this Agreement until it shall have
received such security as it may require (whether by
way of payment in advance or otherwise) for all
costs, claims, expenses (including legal fees) and
liabilities which it will or may expend or incur in
complying with such instructions.
30.3 The Agent shall:
(i) promptly inform each Bank of the contents of any
notice or document received by it in its capacity as
Agent from any of the Obligors hereunder;
(ii) promptly notify each Bank of the occurrence of any
Event of Default or any default by any of the
Obligors in the due performance of or compliance with
its obligations under this Agreement of which the
Agent has notice from any other party hereto;
(iii) save as otherwise provided herein, act as agent
hereunder in accordance with any instructions given
to it by an Instructing Group, which instructions
shall be binding on the Banks; and
(iv) if so instructed by an Instructing Group, refrain
from exercising any right, power or discretion vested
in it as agent hereunder.
30.4 Notwithstanding anything to the contrary expressed or implied herein,
the Agent shall not:
(i) be bound to enquire as to:
(a) whether or not any representation made by any
Obligor in connection herewith is true;
(b) the occurrence or otherwise of any Event of
Default or Potential Event of Default;
(c) the performance by the Obligors of their
obligations hereunder; or
(d) any breach of or default by any Obligor of or
under its obligations hereunder;
(ii) be bound to account to any Bank for any sum or the
profit element of any sum received by it for its own
account;
(iii) be bound to disclose to any other person any
information relating to any member of the Group if
such disclosure would or might in its opinion
constitute a breach of any law or regulation or be
otherwise actionable at the suit of any person; or
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(iv) be under any obligations other than those for which
express provision is made herein.
30.5 Each Bank shall, from time to time on demand by the Agent, indemnify
the Agent, in the proportion its share of the Loan (or, if no Advances have
been made, its Available Commitment) bears to the amount of the Loan (or, if no
Advances have been made, the Available Facility) at the time of such demand
(or, if the Loan has then been repaid in full, immediately prior to the final
repayment thereof), against any and all costs, claims, losses, expenses
(including legal fees) and liabilities together with any VAT thereon which the
Agent may incur, otherwise than by reason of its own gross negligence or wilful
misconduct, in acting in its capacity as Agent hereunder.
30.6 The Agent accepts no responsibility for the accuracy and/or
completeness of any information supplied by the Obligors in connection herewith
or for the legality, validity, effectiveness, adequacy or enforceability of
this Agreement and the Agent shall be under no liability as a result of taking
or omitting to take any action in relation to this Agreement, save in the case
of gross negligence or wilful misconduct.
30.7 Each of the Banks agrees that it will not assert or seek to assert
against any director, officer or employee of the Agent any claim it might have
against any of them in respect of the matters referred to in Clause 30.6.
30.8 The Agent may accept deposits from, lend money to and generally engage
in any kind of banking or other business with any member of the Group.
30.9 The Agent may resign its appointment hereunder at any time without
assigning any reason therefor by giving not less than thirty days' prior
written notice to that effect to each of the other parties hereto Provided
that no such resignation shall be effective until a successor for the Agent is
appointed in accordance with the succeeding provisions of this Clause 30.
30.10 If the Agent gives notice of its resignation pursuant to Clause 30.9,
then any reputable and experienced bank or other financial institution may be
appointed as a successor to the Agent by an Instructing Group during the period
of such notice but, if no such successor is so appointed, the Agent may appoint
such a successor itself.
30.11 If a successor to the Agent is appointed under the provisions of
Clause 30.10, then (i) the retiring Agent shall be discharged from any further
obligation hereunder but shall remain entitled to the benefit of the provisions
of this Clause 30 and (ii) its successor and each of the other parties hereto
shall have the same rights and obligations amongst themselves as they would
have had if such successor had been a party hereto.
30.12 It is understood and agreed by each Bank that it has itself been, and
will continue to be, solely responsible for making its own independent
appraisal of and investigations into the financial condition, creditworthiness,
condition, affairs, status and nature of each member of the Group and,
accordingly, each Bank warrants to the Agent that it has not relied on and will
not hereafter rely on the Agent:
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(i) to check or enquire on its behalf into the
adequacy, accuracy or completeness of any information
provided by the Obligors in connection with this
Agreement or the transactions herein contemplated
(whether or not such information has been or is
hereafter circulated to such Bank by the Agent); or
(ii) to assess or keep under review on its behalf the
financial condition, creditworthiness, condition,
affairs, status or nature of any member of the Group.
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PART 13
ASSIGNMENT AND TRANSFERS
31. BENEFIT OF AGREEMENT
This Agreement shall be binding upon and enure to the benefit of each party
hereto and its or any subsequent successors and assigns.
32. ASSIGNMENTS AND TRANSFERS BY THE OBLIGORS
None of the Obligors shall be entitled to assign or transfer all or
any of its rights, benefits and obligations hereunder.
33 ASSIGNMENTS AND TRANSFERS BY BANKS
33.1 Any Bank may, at any time, assign at its sole cost and expense all or
any of its rights and benefits hereunder or transfer in accordance with Clause
33.3 all or any of its rights, benefits and obligations subject to the
Principal Sponsor's consent, such consent not to be unreasonably withheld where
the proposed assignee or transferee is (i) acting through an office or branch
in the United Kingdom and is carrying on a bona fide banking business for the
purposes of Section 349 of the Income and Corporation Taxes Xxx 0000, or (ii)
another bank or financial institution to whom, at the time of such assignment
or transfer payments may be made without deduction or withholding on account of
United Kingdom taxes.
33.2 If any Bank assigns all or any of its rights and benefits hereunder in
accordance with Clause 33.1, then, unless and until the assignee has agreed
with the Agent and the other Banks that it shall be under the same obligations
towards each of them as it would have been under if it had been an original
party hereto as a Bank, the Agent and the other Banks shall not be obliged to
recognise such assignee as having the rights against each of them which it
would have had if it had been such a party hereto.
33.3 If any Bank wishes to transfer all or any of its rights, benefits
and/or obligations hereunder as contemplated in Clause 33.1, then such transfer
may be effected by the delivery to the Agent of a duly completed and duly
executed Transfer Certificate in which event, on the later of the Transfer Date
specified in such Transfer Certificate and the fifth business day after (or
such earlier business day endorsed by the Agent on such Transfer Certificate
falling on or after) the date of delivery of such Transfer Certificate to the
Agent:
(i) to the extent that in such Transfer Certificate the
Bank party thereto seeks to transfer its rights,
benefits and obligations hereunder, the Borrower and
such Bank shall be released from further obligations
towards one another hereunder and their respective
rights against one another shall be cancelled (such
rights, benefits and obligations being referred to in
this Clause 33.3 as "DISCHARGED RIGHTS AND
OBLIGATIONS");
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(ii) the Borrower and the Transferee party thereto shall
assume obligations towards one another and/or acquire
rights against one another which differ from such
discharged rights and obligations only insofar as the
Borrower and such Transferee have assumed and/or
acquired the same in place of the Borrower and such
Bank; and
(iii) the Agent, such Transferee and the other Banks shall
acquire the same rights and benefits and assume the
same obligations between themselves as they would
have acquired and assumed had such Transferee been an
original party hereto as a Bank with the rights,
benefits and/or obligations acquired or assumed by it
as a result of such transfer.
33.4 On the date upon which a transfer takes effect pursuant to Clause
33.3, the Transferee in respect of such transfer shall pay to the Agent for its
own account a transfer fee of $500.
33.5 In the event that a Bank transfers its Facility Office and, at the
time of such transfer, there arises an obligation on the part of the Obligors
hereunder to pay to such Bank or any other person an amount in excess of the
amount it would have been obliged to pay but for such transfer, then, without
prejudice to any obligation of the Obligors which arise after the time of such
transfer, the Obligors shall not be obliged to pay the amount of such excess.
34. DISCLOSURE OF INFORMATION
34.1 Any information disclosed by the Borrower to any of the Beneficiaries
in connection herewith or in connection with the negotiation of the Facilities
shall be kept confidential by such of the Beneficiaries, Provided that:
(i) subject to the terms hereof each of the Beneficiaries
may disclose to any other of the Beneficiaries any
information about the Borrower;
(ii) each of the Beneficiaries shall be entitled to
disclose such information:
(a) in connection with any proceedings arising
out of or in connection with any Finance
Document;
(b) if required to do so by an order of a court
of competent jurisdiction whether in
pursuance of any procedure for discovering
documents or otherwise;
(c) pursuant to any law or regulation in
accordance with which that party is required
or accustomed to act;
(d) to any governmental, banking or taxation
authority;
(e) to its auditors or legal or other
professional advisers; or
(f) if the information is in the public domain.
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34.2 Any of the Beneficiaries may, at any time with the prior consent of the
Principal Sponsor and the Agent, such consent not to be unreasonably withheld,
disclose to any actual or potential assignee or transferee which has executed a
confidentiality undertaking in favour of the Agent and the Principal Sponsor in
a form acceptable to the Agent and the Principal Sponsor any information such
Beneficiary has obtained about the Obligors Provided always that no person may
disclose any information that they may have obtained about the Obligors or any
of them, to any person which it is aware is a supplier, competitor or customer
of any member of the Group.
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PART 14
MISCELLANEOUS
35. CALCULATIONS AND EVIDENCE OF DEBT
35.1 Interest and commitment commission shall accrue from day to day and
shall be calculated on the basis of a year of 360 days (or, if market practice
differs, in accordance with market practice) and the actual number of days
elapsed.
35.2 Each Bank shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and owing to it
hereunder.
35.3 The Agent shall maintain on its books a control account or accounts in
which shall be recorded (i) the amount of any Advance made or arising hereunder
and each Bank's share therein, (ii) the amount of all principal, interest and
other sums due or to become due from the Borrower to any of the Banks hereunder
and each Bank's share therein and (iii) the amount of any sum received or
recovered by the Agent hereunder and each Bank's share therein.
35.4 In any legal action or proceeding arising out of or in connection with
this Agreement, the entries made in the accounts maintained pursuant to Clauses
35.2 and 35.3, save for manifest error, shall be conclusive evidence of the
existence and amounts of the obligations of the Obligors therein recorded.
35.5 A certificate of a Bank as to (i) the amount by which a sum payable to
it hereunder is to be increased under Clause 13.1 or (ii) the amount for the
time being required to indemnify it against any such cost, payment or liability
as is mentioned in Clause 13.2 or 15.1 shall, in the absence of manifest error,
be conclusive for the purposes of this Agreement.
36. REMEDIES AND WAIVERS
No failure by the Agent or the Banks or any of them to exercise, nor any delay
by the Agent or the Banks or any of them in exercising, any right or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right or remedy prevent any further or other exercise thereof
or the exercise of any other right or remedy. The rights and remedies herein
provided are cumulative and not exclusive of any rights or remedies provided by
law.
37. PARTIAL INVALIDITY
If, at any time, any provision hereof is or becomes illegal, invalid or
unenforceable in any respect under the law of any jurisdiction, neither the
legality, validity or enforceability of the remaining provisions hereof nor the
legality, validity or enforceability of such provision under the law of any
other jurisdiction shall in any way be affected or impaired thereby.
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38. NOTICES
38.1 Each communication to be made hereunder shall be made in writing but,
unless otherwise stated, may be made by telex, facsimile or letter.
38.2 Any communication or document to be made or delivered by one person to
another pursuant to this Agreement shall (unless that other person has by
fifteen days' written notice to the Agent specified another address) be made or
delivered to that other person at the address identified with its signature
below (or in the case of a transferee, at the end of the Transfer Certificate
to which it is a party as Transferee) (save for Notices of Drawdown or notices
under Clause 8.2 relating to the duration of Interest Periods, which shall be
made or delivered to the Agent at Xxxxxxxxx,Xxxxxxxxxxx, Xxxxxx XX0 0XX
Attention: Xxxxx Plant; Facsimile: 01202 343 706; Telex: 8954681 CMB G (or such
other address as the Agent may from time to time notify for this purpose))
shall be deemed to have been made or delivered when despatched (in the case of
any communication made by telex) or (in the case of any communication made by
fax) when receipt has been acknowledged or (in the case of any communication
made by letter) when left at that address or (as the case may be) ten days
after being deposited in the post postage prepaid in an envelope addressed to
it at that address Provided that any communication or document to be made or
delivered to the Agent shall be effective only when received by the Agent and
then only if the same is expressly marked for the attention of the department
or officer identified with the Agent's signature below (or such other
department or officer as the Agent shall from time to time specify for this
purpose).
38.3 Each communication and document made or delivered by one party to
another pursuant to this Agreement shall be in the English language or
accompanied by a translation thereof into English certified (by an officer of
the person making or delivering the same) as being a true and accurate
translation thereof.
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PART 15
LAW AND JURISDICTION
39. LAW
This Agreement shall be governed by, and shall be construed in accordance with,
English law.
40. JURISDICTION
40.1 Each of the parties hereto irrevocably agrees for the benefit of each
of the Agent and the Banks that the courts of England shall have jurisdiction
to hear and determine any suit, action or proceeding, and to settle any
disputes, which may arise out of or in connection with this Agreement and, for
such purposes, irrevocably submits to the jurisdiction of such courts.
40.2 Each of the Obligors irrevocably waives any objection which it might
now or hereafter have to the courts referred to in Clause 40.1 being nominated
as the forum to hear and determine any suit, action or proceeding, and to
settle any disputes, which may arise out of or in connection with this
Agreement and agrees not to claim that any such court is not a convenient or
appropriate forum.
40.3 Each of the Obligors agrees that the process by which any suit, action
or proceeding is begun may be served on it by being delivered in connection
with any suit, action or proceeding in England, to Gulf Offshore N.S. Limited
at 00 Xxxxxxxxx Xxxx, Xxxxxx XX00 0XX or its place of business for the time
being. If such appointment ceases to be effective in respect of any of the
Obligors, such Obligor or Obligors shall immediately appoint a further person
in England to accept service of process on its behalf in England, and failing
the appointment within 15 days, the Agent shall be entitled to appoint such a
person by notice or to such Obligor or Obligors. Nothing contained herein
shall affect the right to serve process in any other manner permitted by law.
40.4 The submission to the jurisdiction of the courts referred to in Clause
40.1 shall not (and shall not be construed so as to) limit the right of the
Agent, the Banks or any of them to take proceedings against any of the Obligors
in any other court of competent jurisdiction nor shall the taking of
proceedings in any one or more jurisdictions preclude the taking of proceedings
in any other jurisdiction (whether concurrently or not) if and to the extent
permitted by applicable law.
40.5 Each of the Obligors hereby consents generally in respect of any legal
action or proceeding arising out of or in connection with this Agreement to the
giving of any relief or the issue of any process in connection with such action
or proceeding including, without limitation, the making, enforcement or
execution against any property whatsoever (irrespective of its use or intended
use) of any order or judgment which may be made or given in such action or
proceeding.
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57
40.6 To the extent that any of the Obligors may in any jurisdiction claim
for itself or its assets immunity from suit, execution, attachment (whether in
aid of execution, before judgment or otherwise) or other legal process and to
the extent that in any such jurisdiction there may be attributed to itself or
its assets such immunity (whether or not claimed), such Obligor hereby
irrevocably agrees not to claim and hereby irrevocably waives such immunity to
the full extent permitted by the laws of such jurisdiction.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first before written.
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58
THE FIRST SCHEDULE
CONDITION PRECEDENT DOCUMENTS
1. In relation to each of the Obligors:
(i) a copy, certified a true copy by a duly authorised
officer of such Obligor, of the constitutive
documents of such Obligor;
(ii) a copy, certified a true copy by a duly authorised
officer of such Obligor of a Board Resolution of such
Obligor approving the execution, delivery and
performance of this Agreement and the terms and
conditions hereof and authorising a named person or
persons to sign this Agreement and any documents to
be delivered by such Obligor pursuant hereto; and
(iii) a certificate of a duly authorised officer of such
Obligor setting out the names and signatures of the
persons authorised to sign, on behalf of such
Obligor, this Agreement and any documents to be
delivered by such Obligor pursuant hereto.
2. A copy, certified a true copy by or on behalf of the Principal
Sponsor, of each such law, decree, consent, licence, approval,
registration or declaration as is, in the opinion of counsel to the
Agent, necessary to render this Agreement and the Security Documents
legal, valid, binding and enforceable, to make this Agreement and the
Security Documents admissible in evidence in each Obligor's
jurisdiction of incorporation and to enable each of the Obligors to
perform its obligations hereunder.
3. A trust agreement executed between the Security Trustee, the Initial
Bank, the Borrower and others, pursuant to which the Security Trustee
declares itself to be trustee for the Banks named therein, the Hedge
Counterparty and such financial institutions in respect of any
security granted pursuant to any Security Document.
4. A first preferred Panamanian ship mortgage and assignment of earnings
and insurances collateral thereto executed in respect of the following
vessels:-
(i) Sea Endeavor (ex Africa Eagle);
(ii) Sea Diligent (ex Sentosa Eagle);
(iii) Sea Explorer (ex Australia Eagle);
(iv) Sea Searcher (ex Golden Eagle);
(v) Sea Eagle (ex Singapore Eagle);
(vi) Sea Conquest (ex Indonesia Eagle).
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59
5. Share Pledge over all of the shares in the Borrower legally and
beneficially owned by Gulf Offshore Marine International, Inc.
6. Evidence that the Borrower has complied with all of its obligations
arising under any Security Document relating to insurance of the
Mortgaged Vessels, together with a report, issued by an independent
person, (being an insurance broker and/or insurance consultant),
addressed to the Agent confirming that insurances effected in respect
of the Original Vessels are adequate.
7. All such notices of assignment as may be called for by any of the
Security Documents.
8. A valuation of the Mortgaged Vessels by an independent valuer
acceptable to the Agent, confirming that as at the date hereof the
value of the Mortgaged Vessels is not less than $14,300,000.
9. Evidence as to the operational condition of each of the Original
Vessels, such evidence to be in such form and such terms as the Agent
may require.
10. An opinion from Xxxxxx Xxxxxx & Asvat, Panamanian counsel for the
Agent.
11. An opinion of Xxxxxxxx Chance, solicitors for the Agent.
12. Evidence that Gulf Offshore N.S. Limited has agreed to act as agent
for the Obligors for the service of process in England.
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60
THE SECOND SCHEDULE
NOTICE OF DRAWDOWN
From: [ ]
To: [ ]
Dated:
Dear Sirs,
1. We refer to the agreement (as from time to time amended, varied,
novated or supplemented, the "Facility Agreement") dated [ ] July, 1996 and
made between Gulf Offshore Shipping Services, Inc. as borrower, GulfMark
International Inc., GulfMark North Sea Limited and Gulf Offshore Marine
International, Inc. as sponsors, Chase Manhattan International Limited as agent
and security trustee and The Chase Manhattan Bank as initial bank. Terms
defined in the Facility Agreement shall have the same meaning in this notice.
2. We hereby give you notice that, pursuant to the Facility Agreement and
on [date of proposed Advance], we wish to borrow an Advance in the amount of [ ]
dollars upon the terms and subject to the conditions contained therein.
[3. We would like this Advance to have a first Interest Period of [ ]
months' duration.]*
4. We confirm that, at the date hereof, the representations set out in
Clause 17 of the Facility Agreement are true and no Event of Default or
Potential Event of Default has occurred.
5. The proceeds of this drawdown should be credited to [insert account
details].
Yours faithfully
........................
for and on behalf of
[ ]
--------------------------------------------------------------------------------
* Insert only if there are no outstanding Advances.
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61
THE THIRD SCHEDULE
FORM OF TRANSFER CERTIFICATE
To: [ ]
TRANSFER CERTIFICATE
relating to the agreement (as from time to time amended, varied, novated or
supplemented, the "Facility Agreement") dated [ ] July, 1996 whereby a dollar
revolving credit facility was made available to Gulf Offshore Shipping
Services, Inc. as borrower by a bank on whose behalf Chase Manhattan
International Limited acted as agent in connection therewith.
1. Terms defined in the Facility Agreement shall, subject to any contrary
indication, have the same meanings herein. The terms Bank, Transferee, Bank's
Participation and Amount Transferred are defined in the schedule hereto.
2. The Bank confirms that the Bank's Participation is an accurate summary
of its participation in the Facility Agreement and requests the Transferee to
accept and procure the transfer to the Transferee of a percentage of the Bank's
Participation (equal to the percentage that the Amount Transferred is of the
aggregate of the component amounts (as set out in the schedule hereto) of the
Bank's Participation) by counter-signing and delivering this Transfer
Certificate to the Agent at its address for the service of notices specified in
the Facility Agreement.
3. The Transferee hereby requests the Agent to accept this Transfer
Certificate as being delivered to the Agent pursuant to and for the purposes of
Clause 33 of the Facility Agreement so as to take effect in accordance with the
terms thereof on the Transfer Date or on such later date as may be determined
in accordance with the terms thereof.
4. The Transferee confirms that it has received a copy of the Facility
Agreement together with such other information as it has required in connection
with this transaction and that it has not relied and will not hereafter rely on
the Bank to check or enquire on its behalf into the legality, validity,
effectiveness, adequacy, accuracy or completeness of any such information and
further agrees that it has not relied and will not rely on the Bank to assess
or keep under review on its behalf the financial condition, creditworthiness,
condition, affairs, status or nature of the Borrower.
5. The Transferee hereby undertakes with the Bank and each of the other
parties to the Facility Agreement that it will perform in accordance with their
terms all those obligations which by the terms of the Facility Agreement will
be assumed by it after delivery of this Transfer Certificate to the Agent and
satisfaction of the conditions (if any) subject to which this Transfer
Certificate is expressed to take effect.
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62
6. The Bank makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness, adequacy
or enforceability of the Facility Agreement or any document relating thereto
and assumes no responsibility for the financial condition of the Borrower or
for the performance and observance by the Borrower of any of its obligations
under the Facility Agreement or any document relating thereto and any and all
such conditions and warranties, whether express or implied by law or otherwise,
are hereby excluded.
7. The Bank hereby gives notice that nothing herein or in the Facility
Agreement (or any document relating thereto) shall oblige the Bank to (i)
accept a re-transfer from the Transferee of the whole or any part of its
rights, benefits and/or obligations under the Facility Agreement transferred
pursuant hereto or (ii) support any losses directly or indirectly sustained or
incurred by the Transferee for any reason whatsoever including, without
limitation, the non-performance by the Borrower or any other party to the
Facility Agreement (or any document relating thereto) of its obligations under
any such document. The Transferee hereby acknowledges the absence of any such
obligation as is referred to in (i) or (ii) above.
8. This Transfer Certificate and the rights and obligations of the
parties hereunder shall be governed by and construed in accordance with English
law.
THE SCHEDULE
1. Bank:
2. Transferee:
3. Transfer Date:
4. Bank's Participation:
Bank's Commitment Bank's Portion of the Advances
5. Amounts Transferred:
[Transferor Bank] [Transferee Bank]
By: By:
Date: Date:
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63
ADMINISTRATIVE DETAILS OF TRANSFEREE
Address:
Contact Name:
Account for Payments
in dollars:
Telex:
Telephone:
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64
THE FOURTH SCHEDULE
THE ORIGINAL VESSELS
VESSEL PROVISIONAL PATENTE
Sea Endeavor (ex "Africa Eagle") 25422-PEXT
Sea Diligent (ex "Sentosa Eagle") 25418-PEXT
Sea Explorer (ex "Australia Eagle") 25421-PEXT
Sea Searcher (ex "Golden Eagle") 00000-XXXX
Xxx Xxxxx (xx "Xxxxxxxxx Xxxxx") 00000-XXXX
Sea Conquest (ex "Indonesia Eagle") 25420-PEXT
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65
THE BORROWER
GULF OFFSHORE SHIPPING SERVICES, INC.
as borrower
by: /s/ N. XXXX XXXXX
Address: 000 Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx
Xxxxxxxxx 00000
XXX
Attention:
THE SPONSORS
GULFMARK INTERNATIONAL, INC.
by: /s/ N. XXXX XXXXX
Address: 0 Xxxx Xxx Xxxx
Xxxxx 0000
Xxxxxxx
Xxxxx 00000
XXX
Attention:
GULF OFFSHORE MARINE INTERNATIONAL, INC.
by: /s/ N. XXXX XXXXX
Address: 000 Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx
Xxxxxxxxx 00000
XXX
Attention:
- 00 -
00
XXXXXXXX XXXXX XXX LIMITED
by: /s/ N. XXXX XXXXX
Address: 00 Xxxxxxxxx Xxxx
Xxxxxx XX00 0XX
Attention:
THE AGENT AND SECURITY TRUSTEE
CHASE MANHATTAN INTERNATIONAL LIMITED
as agent and security trustee
By: /s/ X.X. XXXXXX
Address: Xxxxxxxx Xxxxx
Xxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Global Energy Group
Facsimile: 962 5030
Telex: 8954681 CMB G
THE INITIAL BANK
THE CHASE MANHATTAN BANK
By: /s/ XXX XXXXXXX
Address: Xxxxxxxx Xxxxx
Xxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Global Energy Group
Facsimile: 962 5030
Telex: 8954681 CMB G
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