* Application to be filed with the Securities and Exchange
Commission, pursuant to Exchange Act Rule 24b-2, for confidential
treatment of certain portions of this exhibit.
EXECUTION COPY
___________________________________________________________________
SECOND AMENDED AND RESTATED
AGREEMENT TO
ACQUIRE AND CHARTER
By and Among
AMERICAN PRESIDENT LINES, LTD.,
Transferor,
M.V. PRESIDENT XXXXXXX, LTD.,
M.V. PRESIDENT XXXXX, LTD.,
M.V. PRESIDENT XXXXXXX, LTD.,
M.V. PRESIDENT POLK, LTD.,
M.V. PRESIDENT XXXXXX, LTD.,
APL SHIPHOLDINGS, LTD.,
Transferees,
KREDITANSTALT FUR WIEDERAUFBAU
(as Agent and Lender),
COMMERZBANK AG, HAMBURG
(as Syndicate Agent),
COMMERZBANK AG (KIEL BRANCH),
DRESDNER BANK AG (HAMBURG),
VEREINS-und WEST BANK AG,
DEUTSCHE SCHIFFSBANK AG
NORDDEUTSCHE LANDESBANK-GIROZENTRALE and
DEUTSCHE VERKEHRS-BANK AG (HAMBURG BRANCH)
BANQUE INTERNATIONALE A LUXEMBOURG S.A.
(as the Syndicate)
Dated September 1, 1995
________________________________________________________________
TABLE OF CONTENTS
Page
RECITALS 1
SECTION 1. DEFINITIONS 4
SECTION 2. TRANSFER AND CHARTER OF THE VESSELS 6
SECTION 3. CONDITIONS PRECEDENT TO A TRANSFEREE'S
OBLIGATIONS ON A DELIVERY DATE 7
SECTION 4. REPRESENTATIONS AND WARRANTIES OF TRANSFEREES 10
SECTION 5. COVENANTS 14
SECTION 6. RELEASE OF A TRANSFEREE 18
SECTION 7. THIRD PARTY VESSEL EXCHANGE 18
SECTION 8. NOTICES 19
SECTION 9. COUNTERPARTS 19
SECTION 10. MODIFICATION 19
SECTION 11. SUCCESSORS AND ASSIGNS 19
SECTION 12. GOVERNING LAW 19
SECTION 13. ASSIGNMENT 20
SECTION 14. SEVERABILITY 20
SECTION 15. TABLE OF CONTENTS; HEADINGS 20
SCHEDULE 1 List of Transferees
SCHEDULE 2 List of Syndicate Banks
EXHIBIT A Form of Charter (Vessel transferred to Transferee
by Original Owner)
EXHIBIT A-1 Form of Charter (Vessel transferred to Transferee
by Transferor)
EXHIBIT X-x Form of HDW Certificate of Delivery and Acceptance
EXHIBIT B-2 Form of Daewoo Certificate of Delivery and Acceptance
EXHIBIT C Form of Charter Assignment/Second Charter Assignment
and Consent
EXHIBIT D Form of Charter Guarantee
SECOND AMENDED AND RESTATED
AGREEMENT TO ACQUIRE AND CHARTER
THIS SECOND AMENDED AND RESTATED AGREEMENT TO ACQUIRE
AND CHARTER (this "Acquisition Agreement") is made and
entered into as of this 1st day of September, 1995 by and
among (i) AMERICAN PRESIDENT LINES, LTD., a Delaware
corporation (the "Transferor"); (ii) the six corporations
listed on Schedule 1 attached hereto (collectively, the
"Transferees" and each, individually, a "Transferee"); (iii)
KREDITANSTALT FUR WIEDERAUFBAU ("KfW"), a public law
corporation incorporated in the Federal Republic of Germany;
(iv) COMMERZBANK AG, HAMBURG, a banking corporation
incorporated in the Federal Republic of Germany (the
"Syndicate Agent)"; and (v) the banks listed in Schedule 2
attached hereto (each a "Syndicate Member" and,
collectively, the "Syndicate").
This Acquisition Agreement amends, restates and
supersedes in its entirety that certain Agreement to Acquire
and Charter dated March 14, 1994 among the parties hereto,
which Agreement was previously amended and restated in its
entirety pursuant to that certain Amended and Restated
Agreement to Acquire and Charter dated May 19, 1995 among
the parties hereto and acknowledged by APL Newbuildings,
Ltd., a Nevada corporation (collectively, the "Old AAC").
RECITALS:
A. The Transferor has contracted to purchase three (3)
container vessels (the "HDW Vessels") from Howaldeswerke-
Deutsche Werft AG ("HDW'') as is more specifically set forth
in a certain Shipbuilding Agreement dated May 10, 1993, as
amended (the OHDWO Shipbuildinq Agreement"), between the
Transferor and HDW.
B. The three (3) HDW Vessels have been or will be named
as follows: (i) APL CHINA (Builder's Hull No. 297), (ii) APL
JAPAN (Builder's Hull No. 298) and (iii) APL THAILAND
(Builder's Hull No. 299).
C. The Transferor has also contracted to purchase three
(3) container vessels (the "Daewoo Vessels") from Daewoo
Shipbuilding & Heavy Machinery Ltd. ("Daewoo") as is more
specifically set forth in a certain Shipbuilding Agreement
dated May 10, 1993, as amended (the "Daewoo Shipbuilding
Agreement"), between the Transferor and Daewoo (the HDW
Vessels and the Daewoo Vessels being individually referred
to as a Vessel and, collectively, as the OVesselsO).
D. The three (3) Daewoo Vessels have been or will be
named as follows: (i) APL KOREA (Builder's Hull No. 4028),
(ii) APL SINGAPORE (Builder's Hull No. 4029) and (iii)
APL PHILIPPINES (Builder's Hull No. 4033).
E. The Transferor, KfW, the Syndicate Agent and the
Syndicate entered into a Loan Agreement dated March 14,
1994, providing a loan facility in respect of the HDW
Vessels and the Daewoo Vessels under which the Transferor
may borrow from KfW up to * (the "HDW Tranche") for the
purchase of the HDW Vessels; and may borrow from the
Syndicate up to * (the "Daewoo Tranche") for the purchase of
the Daewoo Vessels (said Loan Agreement, as amended by
Amendment No. 1 thereto dated as of May 19, 1995 and
Amendment No. 2 thereto of even date herewith, and as the
same may be further amended and supplemented from time to
time in accordance with its terms, being hereinafter
referred to as the "Loan Agreement").
F. The parties hereto wish to allow the Transferor to
make partial assignments of the HDW Shipbuilding Agreement
or the Daewoo Shipbuilding Agreement to up to six separate
Delaware corporations, each to be a wholly-owned subsidiary
of American President Companies, Ltd., a Delaware
corporation (the "Charter Guarantor") (such subsidiaries
being referred to, collectively, as the "Original Owners"
and, individually, as an "Original Owner"), each Original
Owner to be partially assigned the HDW Shipbuilding
Agreement or the Daewoo Shipbuilding Agreement, as the case
may be, only insofar as such Agreement relates to a single
Vessel; provided, however, that, as provided in the Loan
Agreement, the Transferor reserves the right not to assign
any Shipbuilding Agreement, but to take title directly to
the relevant Vessel and either to draw down the applicable
Subportion under the Loan Agreement or to transfer the
Vessel to a Transferee following the Transferor's
acquisition of a Vessel pursuant to an Exchange Agreement.
G. The Original Owners, each of which is to be a
Delaware corporation, will acquire the Vessels from the
respective Builders as follows (if at all):
(1) APL Newbuildings, Ltd., a Delaware
corporation, to acquire APL CHINA;
(2) APL M.V. Korea, Ltd., a Delaware corporation,
to acquire APL KOREA;
(3) APL M.V. Japan, Ltd., a Delaware corporation,
to acquire APL JAPAN;
(4) APL M.V. Singapore, Ltd., a Delaware
corporation, to acquire APL SINGAPORE;
(5) APL M.V. Thailand, Ltd., a Delaware
corporation,
to acquire APL Thailand; and
(6) APL M.V. Philippines, Ltd., a Delaware
corporation, to acquire APL PHILIPPINES.
H. On May 19, 1995, pursuant to the Old AAC, APL CHINA
was delivered by the Builder to APL Newbuildings, Ltd., and,
on the same date, APL CHINA was transferred by APL
Newbuildings, Ltd. to one of the Transferees, M.V. President
Xxxxxxx, Ltd., as part of an exchange for a C-10 conbulk
vessel owned by such Transferee, prior to the draw down of
the Subportion relating to such Vessel by such Transferee.
I. With respect to any of the remaining Vessels, if the
Transferor so requests, the parties desire to permit the
Vessel to be delivered by the applicable Builder to such
Original Owner, which Original Owner would remain the owner
of the Vessel and would become a "Transferee" authorized to
draw down the Subportion relating to that Vessel, subject
however to the execution of amendments to the Operative
Documents mutually acceptable to the Transferor, such
Original Owner and the Lenders as provided in Section 7(k)
of the Loan Agreement.
J. The parties also desire to permit, upon the terms
and conditions set forth herein, title to each of the
Vessels (other than APL CHINA) to be transferred by the
Original Owner thereof to the Transferor as part of an
exchange for a C-10 conbulk vessel owned by the Transferor,
whereupon the Transferor would transfer the Vessel in
question to the appropriate Transferee, in connection with
the draw down of the Subportion relating to such Vessel by
such Transferee, and such Transferee shall be permitted to
draw down the Subportion applicable to its Vessel upon such
transfer of the Vessel by the Transferor.
K. Concurrently with any transfer of each Vessel to a
Transferee in accordance with the terms hereof, the
Transferor shall enter into a Charter for such Vessel to be
so transferred, as evidenced by the execution of an HDW
Charter, if the Vessel is one of the Vessels being financed
under the HDW Tranche, or a Daewoo Charter, if the Vessel is
one of the Vessels being financed under the Daewoo Tranche,
each Charter to be in the form of (i) Exhibit A hereto, if
Vessel in question is being transferred to the Transferee by
the Original Owner, or (ii) Exhibit A-1 hereto, if the
Vessel in question is being transferred to the Transferee by
the Transferor.
L. Concurrently with the execution of each Charter in
the form of Exhibit A hereto, the Charter Guarantor shall
execute and deliver to the relevant Transferee a guarantee
of payment obligations of the Transferor as charterer under
such Charter (it being understood that no such guarantee
shall be required with respect to Charters in the form of
Exhibit A-1 hereto).
M. Concurrently with the execution and delivery of each
Charter, the Transferee will assign all of its right, title
and interest in and to such Charter (and, if there is one,
the guarantee by the Charter Guarantor of the charter
payment obligations of the Transferor) to: (i) KfW if it
relates to an HDW Vessel, (ii) the Syndicate Agent and the
Syndicate if it relates to a Daewoo Vessel, and (iii) KfW
(as a second priority assignment) if it relates to a Daewoo
Vessel, in each case as security for the Transferee's
obligations under the Loan Documents.
N. Pursuant to the Loan Agreement, the Charter
Guarantor has executed and delivered to the Lenders an
Amended and Restated Guarantee dated May 19, 1995, which
guarantees all obligations of the Transferor and each
Transferee as Borrower under the Loan Agreement and Security
Documents.
NOW, THEREFORE, in consideration of mutual agreements
herein contained, the parties hereto agree as follows:
SECTION 1. Definitions.
A. The terms "hereof", "herein", "hereby",
"hereto", "hereunder" and "herewith" refer to this
Agreement as the same may be supplemented or amended.
B. Reference to a given agreement or instrument is
a reference to that agreement or instrument as
originally executed, and as modified, amended,
supplemented and restated through the date as of which
reference is made to that agreement or instrument.
C. All capitalized terms used in this Acquisition
Agreement including the Whereas clauses hereof which
are not defined herein shall have the meanings ascribed
to them in the Loan Agreement and in the Schedules and
Appendices to the Loan Agreement. In addition, the
following capitalized terms shall have the meanings set
forth below:
"Certificate of Delivery and Acceptance" means, with
respect to a given Vessel, a certificate in the form of
Exhibit B-1 or Exhibit B-2, as the case may be, to this
Acquisition Agreement dated on the Vessel's Delivery Date,
evidencing the delivery of that Vessel to the designated
Transferee and the acceptance by such Transferee.
"Charter Assignment" means each, and "Charter
Assignments" means every, first priority assignment of each
HDW Charter and each Daewoo Charter by the appropriate
Transferee of the Vessel relating thereto to KfW and to the
Syndicate Agent and the Syndicate, respectively, as security
for such Transferee's obligations as provided under the Loan
Documents and in the form of Exhibit C to this Acquisition
Agreement.
"Charter Documents" means this Acquisition Agreement,
the *, the Bills of Sale from the appropriate Original Owner
(if applicable) and the Transferor (following a vessel
exchange between the Transferor and an Original Owner), as
the case may be, to the Transferee, the Certificates of
Delivery and Acceptance, the Charters, the Charter Hire
Guarantees, the Charter Assignments and the Second Charter
Assignments; provided, however, that, if a Vessel is
transferred by the Transferor (following a vessel exchange
between the Transferor and an Original Owner) directly to
the Transferee in accordance with the terms hereof, there
shall be no Charter Hire Guarantee in respect of such
Vessel.
"Charter Hire Guarantee" means each, and "Charter
Guarantees" means every, guarantee by the Charter Guarantor
of the payment obligations of the Transferor under a
Charter, in the form of Exhibit D to this Acquisition
Agreement; provided, however, that, if a Vessel is
transferred by the Transferor (following a vessel exchange
between the Transferor and an Original Owner) directly to
the Transferee in accordance with the terms hereof, there
shall be no Charter Hire Guarantee in respect of such
Vessel.
*
"Second Charter Assignment and Consent" means each, and
"Second Charter Assignments" means every, second priority
assignment of a Daewoo Charter and, if applicable, the
related Charter Hire Guarantee by the Transferee of the
Vessel relating thereto to KfW as security for such
Transferee's obligations under the Loan Documents with
respect to the Vessel Indebtedness under the HDW Tranche in
the form of Exhibit C to this Acquisition Agreement.
"Solvent" means, with respect to any Transferee on a
Delivery Date, that on such date each of the following is
true as determined under generally accepted accounting
principles: (i) the fair market value of the assets of the
Transferee is greater than the total amount of liabilities
(including contingent liabilities) of the Transferee, (ii)
the present fair salable value of the assets of the
Transferee is greater than the amount that will be required
to pay the probable liabilities of the Transferee for its
debts as they become absolute and matured, (iii) the
Transferee is able to realize upon its assets and pay its
debts and any other liabilities, including contingent
obligations, as they mature and (iv) the Transferee does not
have unreasonably small capital.
SECTION 2. Transfer and Charter of the Vessels.
With respect to any acquisition of a Vessel by a
Transferee:
A. On the Delivery Date for such Vessel, upon the
satisfaction of all conditions precedent set forth in
Section 7 of the Loan Agreement and Sections 2 and 3 of
this Acquisition Agreement, the Transferee shall
acquire such Vessel from the Original Owner or the
Transferor (following a vessel exchange between the
Transferor and an Original Owner), and the Lenders
shall make their Commitment available to the
Transferee.
B. The Vessel will have been registered in the
name of the initial owner thereof (i.e., the Original
Owner or the Transferor following a vessel exchange
between the Transferor and an Original Owner, as the
case may be) under the laws of the Republic of The
Xxxxxxxx Islands and then reregistered in the name of
the Transferee under the laws of the Republic of The
Xxxxxxxx Islands free and clear of all liens, claims
and encumbrances; provided, however, that, if such
Vessel is transferred by the Original Owner to the
Transferor (following a vessel exchange between the
Transferor and an Original Owner), then, immediately
prior to the transfer of the Vessel by the Transferor
to the Transferee, the Vessel shall also have been
reregistered in the name of the Transferor under the
laws of the Republic of The Xxxxxxxx Islands.
C. Upon its acquisition of any Vessel pursuant to
the terms hereof (following a vessel exchange between
the Transferor and an Original Owner), the Transferor
will execute, deliver and record a first preferred
mortgage, and with respect to the Daewoo Vessels a
second preferred mortgage, in substantially the form
attached to the Loan Agreement, covering the Vessel in
favor of the relevant Lenders.
D. Following the acquisition of any Vessel by the
relevant Transferee from the Transferor (following a
vessel exchange between the Transferor and an Original
Owner), and in connection with the drawdown of the
relevant Subportion under the Loan Agreement, the
Transferee will execute, deliver and record an
assumption of the first preferred mortgage executed by
the Transferor, and with respect to the Daewoo Vessels
an assumption of the second preferred mortgage executed
by the Transferor, in substantially the form attached
to the Loan Agreement.
E. Simultaneously with the actions specified in
Section 2.C and Section 2.D, the Transferor shall
charter such Vessel from the Transferee, the Transferee
shall charter such Vessel to the Transferor, pursuant
to the relevant Charter (it being understood that if
the Vessel is transferred to the Transferee by the
Transferor (following a vessel exchange between the
Transferor and an Original Owner) in accordance with
the terms hereof, the Charter shall be in the form of
Exhibit A-1 hereto, instead of Exhibit A hereto), and
the Charter Guarantor shall execute and deliver the
related Charter Hire Guarantee; provided, however,
that, if the Vessel is transferred by the Transferor
(following a vessel exchange between the Transferor and
an Original Owner) to the Transferee in accordance with
the terms hereof, it is understood that no Charter Hire
Guarantee shall be required.
F. In connection with the actions specified in
Sections 2.A, 2.B, 2.C and 2.D, the Transferees shall,
as required in the Loan Agreement (i) execute and
deliver one or more HDW Note(s) (in the case of an HDW
Vessel) or one or more Daewoo Note(s) (in the case of a
Daewoo Vessel), (ii) undertake all obligations as a
co-borrower with joint and several liability with the
other Transferees, with respect to the HDW Tranche
and/or the Daewoo Tranche, as the case may be, as
evidenced by the execution and delivery of Note
endorsements, and (iii) undertake all other obligations
the Transferee may have under the Loan Documents.
X. Xxxxxxxx and presentation of all documents to
complete the transactions contemplated herein shall be
made at the Closings to be held on the Delivery Dates
convened pursuant to the Loan Agreement.
SECTION 3. Conditions Precedent to a Transferee's
Obligations on a Delivery Date.
A Transferee's right to receive a Loan in respect of
its Vessel is expressly conditioned upon the following
preconditions being satisfied and upon receipt by the Agent
or the Syndicate Agent, as the case may be, of the following
documents and evidenced on or before a closing to be held on
the Delivery Date at the offices of Haight, Gardner, Poor &
Xxxxxx, 000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such
other place as may be agreed upon by the Transferor, such
Transferee, the Agent and the Syndicate Agent:
(a) the Transferee shall be a corporation duly
organized and existing in good standing under the laws
of the jurisdiction of its incorporation; the
Transferee shall have full corporate power and
authority to own its assets, conduct its business as
then being conducted, and enter into and consummate the
transactions contemplated hereby and by the Charter
Documents and the Security Documents to which it is a
party, and the Agent or the Syndicate Agent, as the
case may be, shall have received (1) a certified copy
of the certificate of incorporation of the Transferee,
(2) a certificate of the Secretary of the Transferee
attaching the minutes or resolutions of its Board of
Directors authorizing the transactions contemplated
herein, (3) a certificate from the Secretary of the
Transferee or evidencing the authority of the persons
executing the Loan Documents and the Charter Documents
to which it is a party, to execute and deliver such
Loan Documents and Charter Documents and the Transferee
to perform under the Loan Documents and Charter
Documents to which it is a party, and (4) a certificate
of good standing as to the Transferee, all in form and
substance reasonably satisfactory to the Agent or the
Syndicate Agent, as the case may be, and its special
counsel;
(b) the Agent and the Syndicate Agent shall have
received no later than sixty (60) days prior to the
above-referenced closing, written notice from the
Transferor of its intention to cause such Vessel to be
acquired by the Transferee in accordance with the
provisions of this Acquisition Agreement;
(c) the Transferor and the Original Owner, if any,
acquiring such Vessel, shall have entered into an
assignment and assumption agreement pursuant to which
the Transferor shall have assigned to such Original
Owner, and such Original Owner shall have assumed, all
of the Transferor's right, title and interest in and
to, and all of the Transferor's obligations under, the
related HDW Shipbuilding Agreement or Daewoo
Shipbuilding Agreement, as the case may be, to the
extent the same relates to such Vessel;
(d) concurrently with the Transferor's acquisition
of any Vessel (following a vessel exchange between the
Transferor and an Original Owner), the Transferor and
the Original Owner shall have entered into an
assignment agreement, pursuant to which such Original
Owner shall have assigned to the Transferor all of such
Original Owner's right, title and interest in and to
the related HDW Shipbuilding Agreement or Daewoo
Shipbuilding Agreement, as the case may be to the
extent the same relates to such Vessel;
(e) no Event of Default shall have occurred and be
continuing and no Incipient Default shall have occurred
and be continuing and the Transferee shall provide an
officer's certificate to such effect in form and
substance reasonably satisfactory to the Agent or the
Syndicate Agent, as the case may be, and its special
counsel;
(f) there shall not have occurred any material
adverse change in the financial condition of the
Transferee (or any other Transferee that has already
received a Loan that remains outstanding in whole or in
part) which in the reasonable opinion of the Agent
and/or the Syndicate would materially and adversely
affect the ability of any such Transferee to perform
its obligations as to the repayment of the Facility by
the installments together with interest thereon as
herein set out or to perform its obligations under the
Loan Documents to which it is or will become a party;
(g) all representations and warranties of the
Transferee (and any other Transferee that has already
received a Loan that remains outstanding in whole or in
part) contained in this Acquisition Agreement and of
the Charter Guarantor in the Charter Hire Guarantee (if
a Charter Hire Guarantee is required hereunder) being
true and correct in all material respects on that
Delivery Date, except insofar as they relate
exclusively to an earlier date, and the Transferee
shall provide officer's certificates confirming such
matters;
(h) all governmental and other consents, licenses,
approvals and authorizations, if any, required with
respect to the performance of (i) the Transferee under
this Acquisition Agreement and the other Loan Documents
and Charter Documents to which it is a party, and (ii)
the Transferor and the Charter Guarantor (if a Charter
Hire Guarantee is required hereunder) under this
Acquisition Agreement and the other Loan Documents and
Charter Documents to which it is a party shall have
been obtained and shall not have been revoked and, if
requested by the Agent or the Syndicate Agent or its
special counsel, copies of any of the same shall be
provided;
(i) all Uniform Commercial Code financing
statements or other document necessary, or reasonably
requested by the Agent or the Syndicate Agent to
perfect its security interests under any of the
Security Documents and the Charter Documents in the
United States of America, the jurisdiction of
registration of such Vessel or any other relevant
jurisdiction;
(j) evidence that such Vessel has been duly
registered (i) first in the name and ownership of the
Transferor and (ii) then in the name and ownership of
the Transferee, in each case under the laws and flag of
the Republic of The Xxxxxxxx Islands, free of
registered liens except the relevant Mortgage(s);
(k) each Loan Document and Charter Document in
respect of such Vessel shall have been duly executed,
delivered and, where appropriate, registered or
recorded (together with any documents to be executed
pursuant to the terms thereof, including without
limitation, notices of the Assignment(s) of Insurance);
(l) each of the Lenders shall have received
executed originals of the opinions as to the Transferee
substantially in the form attached as Schedule 4 to the
Loan Agreement as well as such other opinions from such
counsel as each Lender shall reasonably request and
each of the Lenders shall have received from its
special counsel, Xxxxxx, Xxxxxxx, Poor & Xxxxxx, a
favorable opinion, in form and substance satisfactory
to the Lenders, as to such matters incident to the
transactions contemplated hereby as any such Lender may
reasonably request; and
(m) all conditions precedent as set forth in
Section 7 of the Loan Agreement shall have been
satisfied.
SECTION 4. Representations and Warranties of Transferees.
Each of the Transferees represents and warrants to each
of the Lenders that:
(a) the Transferee is a corporation duly organized
and validly existing in good standing under the laws of
its jurisdiction of incorporation with full corporate
power and authority to conduct its business as the same
is presently conducted;
(b) the Transferee has legal power and authority
to enter into and carry out the terms of this
Acquisition Agreement and each of the other Loan
Documents and the Charter Documents to which the
Transferee will be a party;
(c) each of this Acquisition Agreement, the other
Loan Documents and the Charter Documents to which the
Transferee will be a party has been (or prior to the
execution thereof will have been) duly authorized by
all necessary action, corporate or other, on the part
of the Transferee, and this Acquisition Agreement
constitutes, and, upon due execution and delivery by
the Transferee, each of the other Loan Documents and
the Charter Documents to which the Transferee is or
will be a party will constitute, in accordance with
their respective terms, legal, valid and binding
instruments enforceable against the Transferee, except
to the extent limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other laws of
general application relating to or affecting the
enforcement of creditors, rights from time to time in
effect;
(d) except as previously disclosed to the
Syndicate Agent and the Agent in writing, there are no
actions, suits or proceedings pending or, to the
Transferee's knowledge, threatened against the
Transferee, any of its properties affecting this
Acquisition Agreement, the other Loan Documents or the
Charter Documents to which the Transferee is or will be
a party or the transactions contemplated thereby which
would materially and adversely affect the performance
of the Transferee of its obligations (if any)
thereunder;
(e) the consummation of the transactions
contemplated by, and compliance by the Transferee with
all the terms and provisions of, this Acquisition
Agreement, the other Loan Documents and the Charter
Documents to which the Transferee is or will be a party
will not violate any provisions of the Certificate of
Incorporation or Bylaws of the Transferee and will not
result in a breach of the terms and provisions of, or
constitute a default under, any other agreement or
undertaking by the Transferee or by which it or any of
its property is bound or any order of any court or
administrative agency entered in any proceedings
binding on the Transferee, or violate any applicable
statute, rule or regulation;
(f) the Transferee is not in default and no
condition exists which with notice or lapse of time or
both would constitute a default by the Transferee, in
any respect which would materially and adversely affect
the ability of the Transferee to perform its
obligations under this Acquisition Agreement, any other
Loan Document, any Charter Document; under any
mortgage, loan agreement, deed of trust, indenture or
other agreement with respect thereto or evidence of
indebtedness to which it is a party or by which it is
bound, and is not in violation of or in default, in any
respect which would materially and adversely affect the
ability of the Transferee to perform its obligations
under this Acquisition Agreement, any other Loan
Document, or any Charter Document, under any order,
writ, judgment or decree of any court, arbitrator or
governmental authority, commission, board, agency or
instrumentality, domestic or foreign;
(g) the Transferee has only one place of business
(which is also the location of the place of business
that is its chief executive office), which is 0000
Xxxxxxxx, Xxxxxxx, Xxxxxxxxxx 00000;
(h) the Transferee has no knowledge of any actual
or proposed deficiency or additional assessment in
connection with any Taxes which either in any case or
in the aggregate would be materially adverse to the
Transferee and which would materially and adversely
affect the ability of the Transferee to perform its
obligations under this Acquisition Agreement, any of
the other Loan Documents or any of the Charter
Documents;
(i) all Taxes (other than taxes based on or
measured by income and withholding taxes), liability
for the payment of which has been incurred by the
Transferee in connection with the execution, delivery
and performance by it of this Acquisition Agreement,
each other Loan Document and Charter Document to which
it is or will be a party, have been paid (or provided
for in its accounts if not payable on or prior to the
Delivery Date of the respective Vessel);
(j) all governmental consents, licenses,
permissions, approvals, registrations or authorizations
or declarations required (i) to enable it lawfully to
enter into and perform its respective obligations under
this Acquisition Agreement, each of the other Loan
Documents and each of the Charter Documents to which it
is or will be a party and (ii) to ensure that its
respective obligations hereunder and thereunder are
legal, valid and enforceable have been obtained or made
and are in full force and effect or will be obtained or
made and be in full force and effect on the date any
such document is executed and delivered; and all
governmental consents, licenses, permissions,
approvals, registrations or authorizations or
declarations of the country of registry of each vessel
required (A) to enable it lawfully to enter into and
perform its obligations under the Mortgage(s) to which
it will be a party, (B) to ensure that its obligations
thereunder are legal, valid and enforceable and (C) to
make the Mortgage(s) to which it will be a party
admissible in evidence in the country in which each
Vessel is registered and the United States of America,
will be obtained or made and be in full force and
effect on the date any such Mortgage is executed and
delivered;
(k) it has not taken any corporate action nor, to
its knowledge, have any other steps been taken or legal
proceedings been started or threatened against it for
its winding-up, dissolution or reorganization or for
the appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of it or of
any or all of its respective assets and revenues;
(l) except as provided by applicable laws of
bankruptcy, insolvency, liquidation or similar laws of
general application, its obligations under this
Acquisition Agreement, each of the other Loan
Documents, and, except as otherwise contemplated by the
Charter Documents, each of the Charter Documents rank
and will rank at least pari passu in priority of
payment, and as to security having the priority
contemplated by the Loan Documents and in all other
respects with all its respective other indebtedness;
(m) except for registration of the First Mortgage
on each Vessel (and the assumption of such Mortgage, as
required) and the Second Mortgage on each Daewoo Vessel
(and the assumption of such Mortgage, as required)
under the laws and flag of the Republic of The Xxxxxxxx
Islands (including any other Loan Document or Charter
Document required by the laws of the country of the
mortgaged vessel's registry to be filed with such
Mortgages), it is not necessary to ensure the legality,
validity, enforceability or admissibility in evidence
of this Acquisition Agreement, any of the other Loan
Documents or any of the Charter Documents to which it
is or will be a party in the United States of America
or, to the best of its knowledge, elsewhere or that it
be filed, recorded or enrolled with any governmental
authority or agency in the United States of America or,
to the best of its knowledge, elsewhere, that it be
stamped with any stamp, registration or similar
transaction tax in the United States of America or, to
the best of its knowledge, elsewhere;
(n) each Transferee is a wholly-owned Subsidiary
of the Transferor; the Transferor is a wholly-owned
Subsidiary of the Charter Guarantor;
(o) the Transferee does not maintain any Plans;
(p) none of the proceeds of the Loans will be used
to purchase or carry margin stock within the meanings
of Regulations G, T, U and X of the Board of Governors
of the Federal Reserve System; the Transferee is not
engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock within
the meaning of Regulations G, T, U or X of the Board of
Governors of the Federal Reserve System;
(q) it is not an "investment company" or a company
"controlled" by an "investment company" (as each of
such terms is defined or used in the Investment Company
Act of 1940, as amended);
(r) the Vessel acquired by the Transferee will be
duly documented in the name of the Transferee under the
flag of the Republic of The Xxxxxxxx Islands;
(s) the Vessel acquired by the Transferee will be
in the absolute and unencumbered ownership of the
Transferee except as contemplated by this Acquisition
Agreement, the other Loan Documents and the Charter
Documents;
(t) the Transferee is, and immediately after the
relevant Lender advances its Commitment will be,
Solvent; and
(u) the Transferor is a wholly-owned Subsidiary of
the Charter Guarantor.
SECTION 5. Covenants.
A. Affirmative Covenants. Each of the
Transferees covenants with each of the Lenders that it
shall:
(1) do all that is necessary to maintain in full
force and effect its corporate existence in
good standing under the laws of its
jurisdiction of incorporation and use its
best efforts to obtain, comply with the terms
of and do all that is necessary to maintain
in full force and effect all authorizations,
approvals, licenses and consents required in
or by the laws of its jurisdiction of
incorporation and the United States of
America and any other relevant jurisdiction
to enable the Transferee to enter into and
perform its obligations under the Loan
Documents and the Charter Documents to which
the Transferee is or will become a party and
to ensure the legality, validity,
enforceability or admissibility in evidence
in the United States of America of the Loan
Documents and the Charter Documents to which
the Transferee is or will become a party and
to comply with the terms of and to do all
that is necessary to maintain in full force
and effect all authorizations, approvals,
licenses and consents required in or by the
national laws of the Republic of The Xxxxxxxx
Islands to enable the Transferee to enter
into and perform its obligations under the
Mortgages to which it is or will become a
party and to ensure the legality, validity,
enforceability and admissibility in evidence
in such country of each such Mortgage;
(2) from time to time on the request of the
Lenders, but at the expense of the
Transferee, do all such acts and execute or
procure the execution of all such assurances
and documents as the Agent or the Syndicate
Agent may reasonably consider necessary for
giving full effect to the Loan Documents and
the Charter Documents to which it is or will
become a party or for more effectively
subjecting the security interests under the
Security Documents and Charter Documents to
which it is or will be a party to the liens
of such Security Documents or more
effectively subject such security interests
to the performance of the provisions thereof;
(3) promptly inform the Agent and the Syndicate
Agent of the occurrence of any Incipient
Default or an Event of Default and upon
receipt of a written request from the Agent
or the Syndicate Agent to do so, confirm to
the Agent or the Syndicate Agent, as the case
may be, that save as previously notified to
the Agent or the Syndicate Agent, as the case
may be, to the best of the knowledge of the
Transferee, no Event of Default has occurred;
(4) if the Transferee's agent for service of
process referred to in Section 11 shall for
any reason cease to be validly appointed,
ensure that another such agent is appointed
(and ensure that such agent acknowledges such
appointment to the Agent or Syndicate Agent,
as the case may be) in a manner reasonably
satisfactory to the Agent or the Syndicate
Agent, as the case may be; and
(5) the Transferee shall send to the Agent and
the Syndicate Agent (i) as soon as possible,
but in no event later than one hundred twenty
(120) days after the end of each fiscal year,
its accounts of all financial statements of
the Transferee, such financial statements to
be prepared in accordance with generally
accepted United States of America accounting
principles at such time consistently applied
all certified as true and correct by a senior
financial officer of the Transferee, (ii) as
soon as the same is instituted (or, to the
knowledge of the Transferee threatened),
details of any litigation, arbitration or
administrative proceedings against or
involving it or the Vessels which if
adversely determined would have a material
adverse effect on the Transferee, or
operation of the Vessels, (iii) together with
the annual financial statements to be
provided in accordance with clause (i) above
a certificate of a financial officer of the
Transferee that no Event of Default and
Incipient Default has occurred and is
continuing, and (iv) from time to time, and
on demand, such additional financial or other
information relating to the Transferee and
the Vessels as may be reasonably requested by
the Agent or the Syndicate Agent.
B. Negative Covenants. Each of the Transferees
covenants with each of the Lenders as follows:
(1) The Transferee shall not without prior
consent of the Agent and the Syndicate Agent
consolidate or amalgamate with, or merge
into, any other entity, or sell, convey,
transfer, lease or otherwise dispose of all
or substantially all of its assets,
including, but not limited to, by dividend
(whether by one transaction or a series of
transactions and whether related or not);
provided, however, that it may consolidate or
amalgamate with, or merge into, any other
entity, or sell, convey, transfer, lease or
otherwise dispose of all or substantially all
of its assets if the buyer, assignee or
transferee corporation (the "Assignee") shall
be a solvent corporation organized and
existing under the laws of the United States
of America or any state thereof following
such transaction and shall have executed and
delivered an agreement, in form and substance
reasonably satisfactory to the Agent and the
Syndicate Agent, containing an assumption by
the Assignee of the due and punctual
performance and observance of all covenants
and obligations of the Transferee hereunder
and under the other Loan Documents and the
Charter Documents to which it is or shall be
a party, and confirming the accuracy of any
representations and warranties made herein
and in each such other Loan Document and
Charter Document as of the dates herein or
therein required with respect to such
Assignee; and provided further, that
immediately following such transaction, no
Incipient Default or Event of Default shall
have occurred and be continuing.
(2) Except for the Charter, the Transferee shall
not charter any HDW Vessel or Daewoo Vessel
without the prior written approval of the
Agent and the Syndicate Agent, respectively.
(3) The Transferee will not create or permit to
subsist any lien on the whole or any part of
its present or future assets except for liens
permitted under Section 14 of the Mortgage to
which it is a party.
(4) The Transferee shall not make or threaten to
make any substantial changes in its business
as presently conducted, namely that of a
single purpose corporation owning one of the
HDW or Daewoo Vessels and chartering such
Vessel to the Transferor, and the Transferee
shall not form any subsidiaries.
(5) The Transferee will not create, incur, assume
or allow to exist any Financial Indebtedness,
nor enter into any financing lease or
undertake any material capital commitment
(including but not limited to the purchase of
any capital asset), except as contemplated
hereby, without the prior written consent of
the Agent, in the case of the HDW Vessels,
and the Agent and the Syndicate Agent, in the
case of the Daewoo Vessels.
(6) The Transferee will not make any loan or
advance or extend credit to any Person or
issue or enter into any guarantee or
indemnity or otherwise become directly or
contingently liable for the obligations,
stocks or dividends of, or own, purchase,
repurchase or acquire (or agree contingently
to do so) any stock, obligations or
securities of, or any other interest in, or
make any capital contribution to, or any
other investment in, any Person, firm or
corporation. The Transferee will not issue
any capital stock or any options, warrants or
other rights with respect to, or securities
convertible into! its capital stock, except
to the Transferor.
(7) The Transferee will not acquire any equity,
share capital, assets or obligations of any
corporation or other entity, except as
contemplated hereby, and it will not permit
any of its voting shares or capital stock to
be held by any party other than the
Transferor.
(8) Without the consent of the Agent in the case
of the HDW Vessels and the Syndicate Agent in
the case of the Daewoo Vessels, the
Transferee will not amend, repeal or modify
its Articles of Incorporation or other
similar documents relating to the governance
of the Transferee.
C. Negative Covenant of Transferor. Without the
prior written consent of the Agent or the Syndicate
Agent, the Transferor shall not transfer the legal or
beneficial ownership, or the control, of any Transferee
or, except as provided in this Acquisition Agreement
and subject to the preceding clause, permit the
consolidation, amalgamation or merger of any Transferee
with or into another corporation or entity.
SECTION 6. Release of a Transferee.
As provided in Section 5.04(c) of the Loan Agreement,
if any HDW or Daewoo Subportion is paid in full and the
Transferee owning the Vessel financed by that Subportion has
the right to have the Mortgage or Mortgages thereon
released, that Transferee shall cease being a party to this
Acquisition Agreement and shall no longer be bound by any
terms and conditions hereof.
SECTION 7. Third Party Vessel Exchange
The parties recognize that, in lieu of delivery of APL
THAILAND or APL PHILIPPINES to an Original Owner, the
Transferor may wish to acquire title to such Vessel from the
applicable Builder following or incident to a vessel
exchange involving the Transferor and an unaffiliated third
party, whereupon (i) APL THAILAND or APL PHILIPPINES, as the
case may be, would be transferred by the Transferor to APL
Shipholdings, Ltd. (formerly named APL M.V. Philippines,
Ltd.), a Delaware corporation ("Shipholdings"), which is one
of the "Transferees" party to the Loan Agreement, and (ii)
following transfer of that Vessel to Shipholdings, the
Subportion applicable to that Vessel would be drawn down by
Shipholdings. As part of such vessel exchange the
Shipbuilding Agreement or the Daewoo Shipbuilding Agreement,
as applicable, may be partially assigned (insofar as the
Agreement relates to the Vessel in question) to a financial
institution acting as a qualified intermediary, provided
that, notwithstanding such partial assignment, the Vessel
shall be delivered by the applicable Builder directly to the
Transferor.
Notwithstanding anything herein or in the Loan
Agreement to the contrary, it shall be a condition precedent
to the right of Shipholdings to draw down the Subportion
applicable to APL THAILAND or APL PHILIPPINES (following
consummation by the Transferor of a vessel exchange
transaction involving an unaffiliated third party and the
subsequent transfer of the Vessel in question by the
Transferor to Shipholdings) that each of the Lenders shall
have consented to such vessel exchange transaction and each
of the Lenders, the Transferor and the Transferees shall
have entered into any amendments to this Acquisition
Agreement and/or the other Operative Documents as may
reasonably be required by the Lenders, and the Transferor
and the Transferees shall have furnished to the Lenders
(subject to confidentiality agreements, as the Transferor or
such unaffiliated third party may reasonably require) copies
of documents relating to such vessel exchange transaction as
may reasonably be requested by the Lenders or their counsel.
SECTION 8. Notices.
Notices required or permitted by the terms of this
Acquisition Agreement or any other Loan Document or Charter
Document shall be made in accordance with Section 15.04 of
the Loan Agreement. Each such notice, if to a Transferee,
shall be sent to the Transferee at the following address (or
such other address as that Transferee hereafter shall
designate in a writing delivered to the other parties):
0000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: President
SECTION 9. Counterparts.
This agreement may be executed in separate
counterparts, each of which, when executed and delivered
shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 10. Modification.
Neither this Acquisition Agreement nor any of its terms
may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the
party against which the enforcement of the termination,
amendment, supplement, waiver or modification is sought.
So long as any Vessel is subject to a Mortgage, neither
this Acquisition Agreement nor any of its terms as the same
relate to that Vessel may be terminated, amended,
supplemented, waived or modified without the prior written
consent of KfW or the Syndicate Agent or the Syndicate, as
the case may be.
SECTION 11. Successors and Assigns.
The terms of this Acquisition Agreement shall be
binding upon, and inure to the benefit of, each of the
parties hereto, and their respective successors and assigns.
SECTION 12. Governing Law.
This Acquisition Agreement shall be construed and
enforced in accordance with and governed by the applicable
law of the State of New York (other than the law of the
State of New York governing choice of law), and each
Transferee hereby submits itself to New York jurisdiction
and agrees to observe and perform the agreements and
covenants and shall have the rights contained in Section
15.08 of the Loan Agreement, the provisions of which are
hereby incorporated herein by reference, to the same extent
and under the same terms and conditions so provided in said
Section 15.08.
SECTION 13. Assignment.
The rights of any Party hereunder may not be assigned,
whether by operation of law or otherwise, except to the
extent permitted by Sections 5.B.(1) of this Acquisition
Agreement and Section 10 of the Loan Agreement, without the
consent of the other parties hereto.
SECTION 14. Severabilitv.
If any provision hereof is invalid, illegal or
unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions, and of such
provisions in other jurisdictions, shall not be affected or
impaired thereby.
SECTION 15. Table of Contents; Headings.
The Table of Contents and the headings of the Sections
herein are for convenience only and shall not affect the
construction or meaning of any provision of this Acquisition
Agreement.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties have caused this
Acquisition Agreement to be duly executed by their
respective officers as of the day and year first above
written.
KREDITANSTALT FUR WIEDERAUFBAU
By:_/s/_________________________
Name: Xxxxxxxxxx Xxxxxxxxx
Title (Director) (Vice President)
COMMERZBANK AG, HAMBURG
By:_/s/_________________________
Name: Kuch
Title: Vice President
By:_/s/_________________________
Name: X. Xxxxxxxx
Title: Senior Vice President
COMMERZBANK AG (KIEL BRANCH)
By:_/s/_________________________
Name: Xxxxxxx
Title
By:_/s/_________________________
Name: Dr. Plate
Title:
DRESDNER BANK AG in HAMBURG
By:_/s/_________________________
Name: X. Xxxxx
Title: Assistant Manager
By:_/s/_________________________
Name: X. Xxxxxx
Title: Senior Manager
VEREINS-und WESTBANK AG
By:_/s/_________________________
Name: VP
Title:
By:_/s/_________________________
Name: AVP
Title:
DEUTSCHE SCHIFFSBANK AG
By:_/s/__________________________
Name: Xxxxx Xxxxxx
Title:Gen. Manager
By:_/s/_________________________
Name: Xxxx Xxxxxx Xxxxx
Title:Ass. Gen. Mgr.
NORDDEUTSCHE LANDESBANK -
GIROZENTRALE
By:_/s/___________________________
Name: Huack
Title:Sen. Vice Pres.
By:_/s/_________________________
Name: Xxxxxxxx
Title: Vice Pres.
DEUTSCHE VERKEHRS-BANK AG (HAMBURG
BRANCH)
By:_/s/____________________________
Name: Spincke
Title: Director
By:__________________________
Name:
Title:
BANQUE INTERNATIONALE A LUXEMBOURG S.A.
By:_/s/_______________/s/___________
Name: Xxxx-Xxxxxx Xxxxxxx
Xxxxxx Xxxxxxxx
Title:Directeur-adjoint
Vice President
AMERICAN PRESIDENT LINES, LTD.
By:_/s/_____________________________
Name: Xxxxxx X. Xxxxx
Title: Assistant Treasuter
M.V. PRESIDENT XXXXXXX, LTD.
M.V. PRESIDENT XXXXX, LTD.
M.V. PRESIDENT XXXXXXX, LTD.
M.V. PRESIDENT POLK, LTD.
M.V. PRESIDENT XXXXXX, LTD.
APL SHIPHOLDINGS, LTD.
By:_/s/____________________________
Name: Xxxxxx X. Xxxxx
Title: Assistant Treasurer
SCHEDULE 1
LIST OF TRANSFEREES
1. M.V. PRESIDENT XXXXXXX, LTD., a Delaware corporation
2. M.V. PRESIDENT XXXXX, LTD., a Delaware corporation
3. M.V. PRESIDENT XXXXXXX, LTD., a Delaware corporation
4. M.V. PRESIDENT POLK, LTD., a Delaware corporation
5. M.V. PRESIDENT XXXXXX, LTD., a Delaware corporation
6. APL SHIPHOLDIDNGS, LTD., a Delaware corporation
EXHIBIT A
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
TO THE EXTENT THAT THIS BAREBOAT CHARTER PARTY
CONSTITUTES CHATTEL PAPER (AS SUCH TERM IS DEFINED IN
THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN ANY
APPLICABLE JURISDICTION), NO SECURITY INTEREST IN THIS
BAREBOAT CHARTER PARTY MAY BE CREATED OR PERFECTED
THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART
OTHER THAN THE ORIGINAL EXECUTED COUNTERPART CONTAINING
THE ACKNOWLEDGMENT THEREOF EXECUTED BY KREDITANSTALT
FUR WIEDERAUFBAU AS AGENT ON THE SIGNATURE PAGE
THEREOF.
BAREBOAT CHARTER PARTY
THIS BAREBOAT CHARTER PARTY (the "Charter")
dated this __th day of __________, 199_, between [
], a corporation organized and existing under the laws
of Delaware (hereinafter "Owner") and American
President Lines, Ltd., a corporation organized and
existing under the laws of Delaware (hereinafter called
"Charterer" or "APL").
W I T N E S S E T H:
WHEREAS, APL has heretofore entered into that
certain Loan Agreement dated March 14, 1994, as amended
by Amendment No. 1 thereto dated May 19, 1995 and as
further amended by Amendment No. 2 thereto dated
September 1, 1995 (the "Loan Agreement"), by and among
APL, Owner, as Borrower, the other "Transferees," as
defined in the Loan Agreement, Kreditanstalt fur
Wiederaufbau (["Vessel Lender" or] "Agent")],
Commerzbank AG (Hamburg) (the OSyndicate AgentO [or
OVessel LenderO]), and the banks listed on Schedule 1
thereto (each a OSyndicate MemberO and collectively the
OSyndicateO), as Lenders, with respect to the purchase
financing of six (6) container vessels, including the
Vessel described below, and American President
Companies, Ltd. (the OCharter GuarantorO) has entered
into that certain Amended and Restated Guarantee dated
May 19, 1995 (the OGuaranteeO), relating to Owner's
obligations under the Loan Agreement as established
pursuant to the below-defined Acquisition Agreement;
WHEREAS, the date hereof is the Delivery Date
of the below-described Vessel pursuant to the Loan
Agreement;
WHEREAS, as contemplated by Section 7(k) of
the Loan Agreement, APL has entered into that certain
Second Amended and Restated Agreement to Acquire and
Charter (the OAcquisition AgreementO) among Owner, the
other corporations identified as Transferees therein
and the parties to the Loan Agreement, pursuant to
which Owner has, by an Exchange Agreement dated as of
the date hereof between Owner and the Original Owner
(OExchange AgreementO), accepted title to, and is
currently the registered owner of, the Republic of The
Xxxxxxxx Islands flag vessel [ ], Official Number
[ ] (the "Vessel") which term shall
include all the boilers, engines, machinery, bowsprits,
masts, spars, sails, riggings, boats, anchors, cables,
apparel, furniture, fittings, equipment and all other
appurtenances to the Vessel appertaining or belonging,
whether now owned or hereafter acquired, whether on
board or not on board, and all additions, improvements
and replacements hereafter made in and to the Vessel,
or any part thereof, or in or to the appurtenances and
equipment aforesaid, but shall exclude leased
equipment), and Owner has undertaken all of the payment
and certain of the performance obligations relating to
Vessel Indebtedness in respect of the Vessel under the
Loan Agreement, as Borrower (as such term is defined in
the Loan Agreement) together with its joint and several
obligations to pay all other Loans made under the [HDW]
[Daewoo] Tranche (as such term is defined in the Loan
Agreement) (collectively, the "Owner Obligations");
WHEREAS, pursuant to the Exchange Agreement,
Owner has taken title to the Vessel, on its Delivery
Date;
WHEREAS, Owner has simultaneously herewith
entered into a First Mortgage on the Vessel in favor of
the Vessel Lender, in substantially the form of the
First Mortgage set forth in Appendix B-1 to the Loan
Agreement ("Mortgage") as security for the Owner
Obligations;
WHEREAS, Owner has agreed to let and demise
the Vessel and Xxxxxxxxx has agreed to hire the Vessel
from Owner, on the terms and conditions set forth in
this Charter, such charter of the Vessel to be
effective upon the execution and delivery of this
Charter;
WHEREAS, Charter Guarantor simultaneously
herewith is entering into a guarantee of the payment
obligations of Charterer under this Charter in favor of
Owner (the "Charter Hire Guarantee");
WHEREAS, simultaneously herewith Owner is
entering into the [ ] Charter Assignment
(the "Charter Assignment") relating to the Charter and
the Charter Hire Guarantee in favor of the Vessel
Lender, and Charterer is consenting to such Charter
Assignment pursuant to this Charter and Charter
Guarantor is consenting to such Charter Assignment in
the Charter Hire Guarantee;
WHEREAS, capitalized terms used herein but
not defined herein shall have the meanings assigned to
them in the Loan Agreement and the Acquisition
Agreement.
NOW, THEREFORE, in consideration of the
premises and the mutual covenants herein contained, the
receipt and adequacy of which is hereby acknowledged,
Owner and Charterer hereby agree as follows:
1. REPRESENTATIONS OF CHARTERER.
(a) Charterer is a corporation duly
organized and validly existing in good standing under
the laws of Delaware with full corporate power and
authority to conduct its business as the same is
presently conducted.
(b) Xxxxxxxxx has legal power and authority
to enter into and carry out the terms of this Charter.
(c) This Charter has been duly authorized by
all necessary action, corporate or other, on the part
of Charterer, and this Charter constitutes, and upon
due execution and delivery by Charterer, the Charter
will constitute, in accordance with its respective
terms, a legal, valid and binding instrument
enforceable against Charterer, except to the extent
limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other laws of general
application relating to or affecting the enforcement of
creditors' rights from time-to-time in effect.
(d) Except as previously disclosed to Owner,
the Agent and the Syndicate Agent in writing, there are
no actions, suits or proceedings pending or, to
Xxxxxxxxx's knowledge, threatened against Charterer, or
any of its properties affecting the Charter or the
transactions contemplated thereby which would, if
adversely determined, materially and adversely affect
the performance of Charterer of its obligations
hereunder.
(e) The consummation of the transactions
contemplated by, and compliance by Charterer with all
the terms and provisions of, the Charter will not
violate any provisions of the Certificate of
Incorporation or bylaws of Charterer and will not
result in a breach of the terms and provisions of, or
constitute a default under, any other agreement or
undertaking by Charterer or by which it or any of its
property is bound or any order of any court or
administrative agency entered in any proceedings
binding on Charterer, or violate any applicable
statute, rule or regulation.
(f) Charterer is not in default and no
condition exists which with notice or lapse of time or
both would constitute a default by Charterer, in any
respect which would materially and adversely affect the
ability of Charterer to perform its obligations under
this Charter, under any mortgage, loan agreement, deed
of trust, indenture or other agreement with respect
thereto or evidence of indebtedness to which it is a
party or by which it is bound, and is not in violation
of or in default, in any respect which would materially
and adversely affect the ability of Charterer to
perform its obligations under this Charter, under any
order, writ, judgment or decree of any court,
arbitrator or governmental authority, commission,
board, agency or instrumentality, domestic or foreign.
(g) Xxxxxxxxx has more than one place of
business and the location of the place of business
which is its chief executive office is 0000 Xxxxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000.
(h) All taxes (other than taxes based on or
measured by income and withholding taxes), liability
for the payment of which has been incurred by Charterer
as such in connection with the execution, delivery and
performance by it of the Charter, have been paid (or
provided for in its accounts if not payable) on or
prior to the delivery date of the Vessel.
(i) All consents, licenses, permissions,
approvals, registrations or authorizations or
declarations required by United States of America
federal, state and local governments and the government
of the jurisdiction of incorporation of Charterer and
any applicable foreign jurisdiction (1) to enable it
lawfully to enter into and perform its respective
obligations under this Charter, (2) to ensure that its
obligations hereunder are legal, valid and enforceable,
and (3) to make this Charter admissible in evidence in
the United States of America and such country of
Charterer's incorporation have been obtained or made
and are in full force and effect.
(j) It has not taken any corporate action
nor to its knowledge has any other steps been taken or
legal proceedings been started or threatened against it
for its winding-up, dissolution or reorganization or
for the appointment of a receiver, administrative
receiver, administrator, trustee or similar officer of
it or of any or all of its respective assets and
revenues.
(k) Charterer represents and warrants that
any representation and warranty made on or prior to the
date hereof by any of its Subsidiaries which is a party
to a Charter in this Charter or in any of the Operative
Documents or by any such Subsidiary in any certificate,
statement or other document issued by and on behalf of
any such Subsidiary is not or was not incorrect or
misleading in any material respect when made or deemed
made.
2. PERIOD OF CHARTER AND BASIS OF CHARTER HIRE.
(a) Owner agrees to charter and Xxxxxxxxx
agrees to hire the Vessel delivered hereunder on the
terms and conditions herein set forth for a period of
fifteen years from the date hereof with respect to the
Vessel, unless earlier terminated in accordance with
the terms hereof upon payment of all such principal and
interest and such other amounts (said period with
respect to each Vessel hereinafter referred to as its
OCharter PeriodO).
(b) Subject to the provisions of Section
24(b)(i) hereof, Charter hire ("Charter Hire") shall be
paid by Charterer to, or for the account of, Owner in
the following two components: (i) "Basic Hire"
consisting of (x) principal and interest due with
respect to the Subportion relating to the Vessel from
the Borrower to the Agent pursuant to Sections 3, 4, 5,
6 and 12 of the Loan Agreement, and the [HDW] [Daewoo]
Notes related to such Subportion issued by Owner
pursuant to Section 4 of the Loan Agreement, at the
times and places, in the manner and to the parties set
forth in said sections and such Notes, including
without limitation the provisions of Section 3.05 with
respect to *, Section 3.08 with respect to default
interest, Section 5.03 with respect to *, and Section
5.04 with respect to prepayment and (y) all indemnity
payments required under Section 11 of the Loan
Agreement when due and payable, and (ii) "Additional
Charter Hire" payable semi-annually at the time of
payment of Basic Hire in an amount equal to the
difference between Basic Hire and an amount for such
semi-annual period calculated at the rate of * per day
for such period; provided that Charter Hire shall
always be in an amount sufficient to cover Basic Hire
and Supplemental Charter Hire.
At the end of the fifteen-year charter term
provided in Section 2(a) above, Charterer shall have
the right to extend the Charter for up to three
additional one-year periods. To extend the Charter,
Xxxxxxxxx must give prior written notice of the
one-year extension at least 60 days prior to the end of
the Charter, and, with respect to subsequent periods,
at least 60 days prior to the end of each one-year
extended period. The extension will be on the same
terms and conditions as the Charter; provided, however,
that the amount of Charter Hire shall be equal to the
fair market charter hire of the Vessel as determined in
good faith by the parties within 30 days prior to the
commencement of any one-year extension.
(c) This Charter may not be canceled or
terminated, except in accordance with the expressed
provisions hereof, for any reason whatsoever and
Charterer shall have no right to be relieved or
discharged from obligation or liability under this
Charter except as otherwise expressly provided herein
for any reason whatsoever. Charterer hereby waives, to
the extent permitted by applicable law, any and all
rights which it may now have or which at any time
hereafter may be conferred upon it by statute or
otherwise, to terminate, cancel, quit or surrender this
Charter except as otherwise expressly provided herein.
Charterer acknowledges and agrees that its obligation
to pay all Basic Hire and Supplemental Charter Hire
pursuant to this Section 2 and all other amounts
payable on behalf of Owner to the Agent pursuant to the
terms of this Charter shall be absolute and
unconditional under any and all circumstances, shall
not be subject to any counterclaim, set-off, deduction,
abatement or defense based upon any claim Charterer may
have against Owner, the Agent, the Syndicate Agent or
any other Lender or any other Person whatsoever, and
shall remain in full force and effect without regard
to, and shall not be released, discharged or in any way
effected by any circumstance or condition (whether or
not Charterer shall have knowledge or notice thereof),
including, without limitation: (i) any amendment or
modification of this Charter, the Loan Agreement, any
agreements relating to any thereof or any other
instrument or agreement applicable to the Vessel or any
part thereof or any assignment or transfer of any
thereof or any furnishing or acceptance of additional
security, or any release of any security, or any
failure or inability to perfect any security; (ii) any
failure on the part of Owner to perform or comply with
any term of this Charter or any failure on the part of
the Agent, the Syndicate Agent or any other Lender to
perform or comply with the terms of the Loan Agreement
or any other instrument agreement applicable thereto;
(iii) any waiver, consent, change, extension,
indulgence or other action or inaction under or in
respect to this Charter or any other such instrument or
agreement, or any exercise or nonexercise of any right,
remedy, power or privilege under or in respect of any
such instrument or agreement; (iv) any bankruptcy,
insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding with
respect to Owner, the Agent, the Syndicate Agent,
Charter Guarantor, any Lender or any affiliate of any
of them, or their respective properties or creditors,
or any action taken by any court, trustee, receiver or
liquidating agent in any such proceeding, including,
without limitation, any termination or rejection of
this Charter or any assignment of either thereof by any
court, trustee, receiver or liquidating agent of
Charterer or Owner or of any of their respective
properties in any such proceeding; (v) limitation on
the liability or obligations of Charterer under this
Charter or any termination, or cancellation (except as
expressly provided in this Charter), frustration,
invalidity, irregularity or unenforceability, in whole
or in part, of this Charter or any term hereof or any
lack of power or authority of Charterer or Owner to
enter into this Charter; (vi) any assignment or other
transfer of this Charter by Owner (whether pursuant to
Section 30 hereof or otherwise) or any lien, charge or
encumbrance, from whatever source arising, on or
affecting Charterer's estate in, or any subchartering
of, all or any part of the Vessel (whether or not
pursuant to the express provisions of this Charter or
otherwise); (vii) any damage to, or loss, destruction,
requisition, seizure, forfeiture or marshal's or other
sale of, the Vessel or any exercise of rights with
respect to the Vessel under the Mortgage; (viii) any
libel, attachment, levy, detention, sequestration or
taking into custody of the Vessel, or any interruption
or prevention of or restriction on or interference with
the use or possession of the Vessel; (ix) any title
defect or encumbrance or any dispossession from the
Vessel by title paramount or otherwise; (x) any act,
omission, misrepresentation or breach on the part of
Owner under this Charter or any other agreement at any
time existing between Owner and Charterer, or under any
statute, law or governmental regulation; (xi) any other
circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of
a charterer and irrespective of any other circumstance
which might otherwise limit the recourse against
Charterer; (xii) any defect in the seaworthiness,
condition, design, operation or fitness for use of the
Vessel or the ineligibility of the Vessel for any
particular trade; or (xiii) any other occurrence or
condition whatsoever, foreseen or unforeseen, whether
similar or dissimilar to the foregoing, now existing or
hereafter occurring.
Even though Charterer shall be deprived of or
limited in the use of the Vessel in any respect or for
any length of time, whether or not by reason of some
act, omission or breach on the part of Owner, Charterer
or any other party, whether or not resulting from
accident and whether or not without fault on the part
of Charterer, Charterer will continue to make all
payments required of Charterer by the terms of this
Charter, whether for Basic Hire, Supplemental Charter
Hire or otherwise, without interruption or abatement,
unless and until this Charter shall have terminated
with respect to the Vessel in accordance with the
express provisions hereof. If, for any reason
whatsoever, this Charter shall be terminated in whole
or in part by operation of law or otherwise, except as
specifically provided herein, Charterer nonetheless
agrees to pay an amount equal to each payment of Basic
Hire, Supplemental Charter Hire or other amounts, at
the time such payment would have become due and payable
in accordance with the terms hereof had this Charter
not been terminated in whole or in part.
Nothing contained in this clause (c) shall be
construed to be a waiver, modification, alteration or
release of any claims which Charterer may have at any
time during the Charter Period or subsequent thereto
for damages or equitable relief, for breach by Owner or
APL of any provisions in any of the Charter Documents
or the Loan Documents, or by the Vessel Lender of any
provisions in any of the Loan Documents, or for any
loss due to any acts taken by any of the parties hereto
or thereto.
(d) As supplemental charter hire
(OSupplemental Charter HireO), Charterer shall pay as
and when due any and all amounts (other than principal
and interest on the [HDW] [Daewoo] Notes in respect of
the Subportion relating to the Vessel, including
interest at the Default Interest Rate) payable by Owner
pursuant to the Loan Agreement with respect to the
Subportion relating to each Vessel, at the times and
places, and in the manner and to the parties set forth
in such agreements.
3. DELIVERY AND ACCEPTANCE.
Owner hereby lets, demises and delivers the
Vessel to Charterer and Charterer hereby accepts
delivery of the Vessel, pursuant to the terms of this
Charter. IT IS AGREED THAT OWNER MAKES NO WARRANTY OR
REPRESENTATION, EITHER EXPRESSED OR IMPLIED, AS TO
TITLE TO, AS TO THE DESIGN, CONDITION, MERCHANTABILITY
OR SEAWORTHINESS OF, AS TO THE QUALITY OF THE MATERIAL,
EQUIPMENT OR WORKMANSHIP IN OR AS TO THE CONSUMABLE
STORES ON BOARD THE VESSEL, OR AS TO THE FITNESS OF THE
VESSEL FOR ANY PARTICULAR PURPOSE OR AS TO THE
ELIGIBILITY OF THE VESSEL FOR ANY PARTICULAR TRADE, OR
ANY OTHER WARRANTY OR REPRESENTATION WHATSOEVER.
4. REDELIVERY.
At the expiration of its Charter Period, the
Vessel (unless lost) shall be redelivered by Xxxxxxxxx
to Owner at the end of the voyage then in progress at a
safe berth to be selected by Owner at a port to be
designated by Owner or another mutually agreed port.
5. OPERATING LIMITS.
Charterer shall have the full use of the
Vessel, and may operate the Vessel throughout the
world, for the carriage of any lawful cargoes in any
lawful trade on voyages for which the Vessel is
suitable and for which insurance is procured by
Charterer and in effect prior to entering such trades.
All necessary insurance required for the trades in
which the Vessel is engaged will be procured by
Charterer pursuant to Section 17 hereof and paid for by
Xxxxxxxxx.
6. CONDITION OF VESSEL ON DELIVERY.
(a) The Vessel, upon its delivery hereunder,
shall be documented under the laws of the Republic of
The Xxxxxxxx Islands. No change will be made in the
registry of the Vessel without the approval of Owner
and compliance by Owner with the terms of Section
(20)(b) of the applicable Mortgage.
(b) On its delivery, the Vessel is classed
by the American Bureau of Shipping in the highest
classification and rating for vessels of her age and
type. On its delivery, the Vessel shall be in good
running order and repair, and will be, insofar as due
diligence shall make it so, strong and well and
sufficiently tackled, apparelled, furnished, equipped
and in good operating condition, ordinary wear and tear
and depreciation excepted.
(c) By its acceptance of delivery of the
Vessel, Charterer acknowledges that the Vessel is in
all respects satisfactory to Charterer and such
delivery shall constitute full performance by Owner of
all of Owner's obligations hereunder, relating to the
condition of the Vessel, required to be performed by
Owner prior to the delivery.
7. INSPECTIONS.
(a) Owner and Xxxxxxxxx shall agree on a
single surveyor appointed for the purpose of
determining and stating in writing the condition of the
Vessel at the time of redelivery. If not less than ten
(10) days prior to redelivery, Owner and Charterer
shall fail to have agreed on the surveyor to be
appointed for such purpose, either party may request
The American Bureau of Shipping, New York, to make such
appointment, and the surveyor so appointed shall
perform such survey. The expense of the aforesaid
surveyor shall be shared equally by Owner and
Xxxxxxxxx. Owner and Charterer may have their own
representative in attendance at all surveys.
(b) Prior to redelivery of the Vessel, the
auxiliary machinery, generators, main propulsion units
and boilers may be opened for inspection only by mutual
agreement between Owner and Charterer, in which event
any damage disclosed shall be repaired as may be
required prior to redelivery. The expense of repair
shall be paid by Xxxxxxxxx. If no repairs are found
necessary as a result of opening said machinery, the
cost of opening will be borne by the party requesting
the opening.
8. MAINTENANCE AND CLASSIFICATION.
Charterer shall be charged with full
responsibility for maintenance and repair of the Vessel
throughout the Charter Period and shall at all times,
without expense to Owner, maintain and preserve the
Vessel in good running order and repair, so that the
Vessel shall be, insofar as due diligence can make it
so, strong and well and sufficiently tackled,
apparelled, furnished, equipped and supplied and in
every respect seaworthy and good operating condition,
ordinary wear and tear excepted. Furthermore,
Charterer shall maintain the Vessel so as to enable it
to the highest classification and rating of The
American Bureau of Shipping for vessels of the same age
and type. On redelivery, any outstanding requirements
shall be taken care of by Charterer, or as Charterer
may otherwise mutually agree with Owner in respect
thereto. Owner will authorize The American Bureau of
Shipping to release all records to Charterer relating
to the Vessel.
9. INVENTORY.
A complete inventory of the Vessel's entire
outfit, equipment, furniture, furnishings, appliances,
spare and replacement parts whether owned, pooled or
shared with other operators, and of all unbroached
consumable stores and slop chest is warranted by Owner
at delivery. An inventory shall be taken and mutually
agreed upon by representatives of Xxxxxxxxx and Owner
at the time of redelivery. The cost of taking such
inventory shall be borne equally by Charterer and
Owner. Charterer shall pay all shortfalls from the
delivery inventory at the current market prices at the
port of redelivery, except as may be otherwise mutually
agreed.
10. FUEL AND LUBRICANTS.
Charterer shall accept and pay for all fuel
and lubricants in storage tanks on board at the time of
the Vessel's delivery hereunder and, correspondingly,
Owner shall accept and pay for all such fuel and
lubricants in storage tanks left on board at the time
of redelivery. Each shall pay for fuel and lubricants
in storage tanks at the last invoiced price paid
therefor.
11. USE OF EQUIPMENT.
(a) Charterer shall have the use of the
Vessel and its outfit, equipment (including cabin,
crew, galley and container lashing equipment),
furniture, furnishings, appliances, spare and
replacement parts on board the Vessel or ashore as
available and shown in the inventory at delivery under
this Charter, and Charterer shall at all times, and at
its own expense, comply with and discharge Owner's
obligations, and shall be entitled to all the benefits
and rights of Owner, under Section (25)(a) of the
Mortgage as to maintenance of the Vessel and its
classification and compliance with all applicable laws,
treaties, conventions, rules and regulations of the
Republic of The Xxxxxxxx Islands, all in accordance
with the terms of said Section (25)(a).
(b) Charterer furnished outfit, equipment
(including cabin, crew, galley and container lashing
equipment), furniture, furnishings, appliances, spare
and replacement parts on board the Vessel and not shown
in the inventory or supplemental inventories as Owner
furnished at the time of delivery shall remain the
property of Charterer, and Charterer at the time of
redelivery shall have the right to remove such items or
at its option may leave such items on board the Vessel.
All items left aboard the Vessel at the termination of
the Charter with respect to the Vessel shall be deemed
abandoned to Owner.
(c) Charterer shall be at liberty to fit any
additional equipment required for the services of
Charterer, beyond what is on board at commencement of
Charter with respect to the Vessel, such work to be
done at its time and expense, and such equipment to be
considered its property, and Charterer shall be at
liberty to remove such equipment at its time and
expense during or prior to the expiry of this Charter
with respect to the Vessel; provided that such removal
shall in no way significantly alter the condition of
the Vessel at the time of its redelivery to Owner. All
additional equipment left aboard the Vessel at the
termination of the Charter shall be deemed abandoned to
Owner. Charterer shall make no substantial change in
the structure, type or speed of the Vessel or change
its rig without first obtaining the written approval of
Owner and the Vessel Lender; provided, however, that no
such approval need be obtained in respect of any change
which shall be necessary to comply with the
requirements of the United States Coast Guard, the
Republic of The Xxxxxxxx Islands, or The American
Bureau of Shipping in order to entitle the Vessel to
the classification and rating required above.
12. WARRANTY CLAIMS.
Owner hereby assigns to Charterer Owner's
rights to the extent assignable, under the [HDW]
[Daewoo] Shipbuilding Agreement with respect to the
Vessel with [ ] (the OShipbuilderO)
relating to the condition and performance of the
Vessel, including its replacement and repair warranty
rights under said contract, and, if not assignable,
then Charterer shall be subrogated to all such rights
of Owner, and Owner hereby assigns to Charterer all
Owner's rights with respect to the standby letter of
credit relating to such warranty rights, and it is
agreed that:
(a) Charterer may negotiate and process all
warranty claims directly with the Shipyard and shall
provide Owner with prior notice of all warranty claims
whenever reasonably practicable;
(b) Owner will cooperate with Charterer in
processing all Vessel warranty claims against the
Shipyard if requested by Xxxxxxxxx; and
(c) All fees and expenses incurred to
prosecute or litigate Vessel warranty claims against
the Shipyard shall be borne by Charterer.
13. OWNER AND VESSEL LENDER INSPECTIONS.
Charterer shall at all reasonable times
afford Owner and the Vessel Lender, or their respective
authorized representatives, full and complete access to
the Vessel for the purpose of inspecting or surveying
the same and its papers and, at the request and expense
of Owner or the Vessel Lender, Charterer shall deliver
for inspection by such requesting party copies of any
and all contracts and documents relating to the Vessel,
whether on board or not on board.
14. LAY-UP.
Notwithstanding anything to the contrary in
this Charter, Charterer may at any time during the
period of this Charter, lay-up the Vessel at a safe
place so long as permitted by the applicable Mortgage
in which case Charterer's obligations under this
Charter shall include, during the period of lay-up,
taking the customary precautions for the maintenance
and safety of the Vessel and of paying, in addition to
all other amounts required under this Charter, all
other expenses attributable to such precautions and to
the laying-up of the Vessel.
15. CHARTERER TO MAN.
During the period of this Charter, Charterer
shall at its expense, and by its own procurement, man,
victual, navigate, operate, supply, and fuel the Vessel
and shall pay all charges and expenses of every kind
and nature whatsoever incident to the use and operation
of the Vessel under this Charter.
16. CONDITION ON REDELIVERY OF VESSEL.
(a) The Vessel shall be redelivered to Owner
(unless lost) pursuant to the terms of this Charter in
all respects in the same condition of operation and
repair as when delivered, except as otherwise provided
herein or mutually agreed, ordinary wear and tear not
affecting class excepted. Unless otherwise agreed
between the parties and, except as provided in
paragraph (b) of this Section 16, Charterer shall
repair all damages to the Vessel occurring during the
Charter Period, and shall replace all lost, worn out or
otherwise non-operating items, to the extent necessary
to put each Vessel in all respects in the same
condition of operation and repair as when delivered,
ordinary wear and tear not affecting class excepted.
If, at the time of redelivery, repairs, renewals,
replacements or other obligations for which Charterer
is liable remain to be accomplished and it is mutually
agreed between the parties that such items need not be
accomplished before redelivery, Charterer shall pay the
agreed upon cost of such items. At the redelivery
survey provided for in Section 7 hereof, the surveyor
representing both Charterer and Owner shall determine
and state the repairs or work necessary to place the
Vessel on the date of redelivery in the condition and
class required in this Charter, which statement shall
include all repairs or work required by outstanding
classification requirements of The American Bureau of
Shipping or marine inspection requirements of the
United States Coast Guard, if applicable, in effect
with respect to the Vessel as of the date of the
redelivery to place it in such condition.
(b) Owner agrees that upon the redelivery
Charterer shall have no obligation to renew or repair
the Vessel's cell guides, which shall be returned in
Oas is, where isO condition.
17. RISK OF LOSS, INSURANCE.
Charterer hereby assumes all of the risks and
liability resulting from or arising out of Charterer's
possession, use, operation or storage of the Vessel,
and Charterer shall at all times, at its own expense,
comply with and discharge Owner's obligations under
Section (29) of the Mortgage as to the maintenance of
insurance on the Vessel, and shall be entitled to all
the benefits and rights of Owner under said section,
during the Charter Period (and shall, along with Owner
and the Vessel Lender, be named as an assured,
additional assured, and loss payee, as applicable), all
in accordance with the provisions of said section. In
any case where Charterer shall be obligated to give
notice to the Vessel Lender pursuant to this Section
17, Charterer shall also give simultaneous notice to
Owner.
18. ACTUAL OR CONSTRUCTIVE TOTAL LOSS.
If an Event of Loss shall occur, Charterer
shall (i) give prompt written notice thereof to Owner
and the Vessel Lender, (ii) deposit with the Vessel
Lender for the account of Owner, on or before the
Redemption Date, all amounts required to be paid by
Owner to the Vessel Lender on such date pursuant to
Section 5.04(b)(ii) of the Loan Agreement, (iii) pay to
Owner any insurance proceeds or other compensation, in
excess of its payment obligations pursuant to subclause
(ii) hereof, and (iv) be entitled to the credit
referred to in Section 5.04(b)(iii) with respect to its
payment obligations pursuant to subclause (ii) hereof.
Upon Charterer's payment pursuant to subclause (ii)
hereof (to the extent modified by subclause (iv)
hereof), this Charter shall terminate.
19. BILLS OF LADING.
Charterer shall utilize its customary
contracts of affreightment, including its long form and
short form bills of lading, the standard form of
Military Sealift Command Shipping Agreement, and cargo
charter parties all of which foregoing documents shall
include Clause Paramount, Liberties Clause, General
Average Clause, New Xxxxx Xxxxxx, and Both-to-Blame
Collision Clause.
20. GENERAL AND PARTICULAR AVERAGE.
Average adjusters, appointed by Xxxxxxxxx
from a list of adjusters satisfactory to Owner, shall
attend to the settlement and collection of both general
and particular average losses subject to the customary
charges. Xxxxxxxxx agrees to assist the adjuster in
preparing the average statement and to take all other
possible measures to protect the interests of the
Vessel and Owner.
21. SALVAGE.
All earned salvage will be for Xxxxxxxxx's
account.
22. LIENS.
(a) Neither Charterer nor the Master of the
Vessel nor any other Person shall have the right,
power, or authority to create, incur or permit to be
placed upon the Vessel any liens whatsoever other than
those permitted by Section 14 of the Mortgage, and
shall hold harmless and indemnify Owner and the Vessel
Lender against the claims and demands of all Persons
whomsoever arising as a result of any mortgage,
security interest, lien or charge whatsoever on the
Vessel, except that such undertaking by Charterer shall
not apply to the lien of the Mortgage.
(b) Charterer shall at all times, at its own
cost and expense, comply with and discharge Owner's
obligations under Sections (15), (16) and (22) of the
Mortgage with respect to the release and discharge of
any lien or levy against the Vessel, and shall give
notice to Owner if it shall be required to give notice
to the Vessel Lender pursuant to said Section (16).
(c) Xxxxxxxxx agrees to carry a properly
certified copy of this Charter and the Mortgage with
the ship's papers on board the Vessel, and agrees to
exhibit the same to any person having business with
such Vessel and to any representative of the Xxxxxx
Xxxxxx, and agrees also to exhibit the same to any
representative of Owner on demand.
(d) Xxxxxxxxx further agrees to fasten in
the Vessel in a prominent place, and to maintain during
the Charter Period a framed printed or typewritten
notice in plain type and which shall cover a space of
not less than six (6) inches wide by nine (9) inches
high (or of such other dimensions as may be required by
law) reading substantially as follows:
ONOTICE OF FIRST PREFERRED
SHIP MORTGAGE AND CHARTER
THIS VESSEL IS OWNED BY M.V. PRESIDENT XXXXXXX,
LTD., A DELAWARE CORPORATION (THE OSHIPOWNERO),
AND IS CHARTERED BY AMERICAN PRESIDENT LINES,
LTD., A DELAWARE CORPORATION, AND IS COVERED BY A
FIRST PREFERRED SHIP MORTGAGE IN FAVOR OF
KREDITANSTALT FUR WIEDERAUFBAU, UNDER AUTHORITY OF
THE REPUBLIC OF THE XXXXXXXX ISLANDS. UNDER THE
TERMS OF SAID MORTGAGE AND CHARTER, NEITHER THE
SHIPOWNER, ANY CHARTERER, THE MASTER OF THE VESSEL
NOR ANY OTHER PERSON, HAS ANY RIGHT, POWER OR
AUTHORITY TO CREATE, INCUR OR PERMIT TO BE PLACED
OR IMPOSED UPON THIS VESSEL ANY LIEN WHATSOEVER
OTHER THAN THE LIEN OF SAID MORTGAGE AND LIENS FOR
WAGES OF A XXXXXXXXX WHEN EMPLOYED DIRECTLY BY THE
SHIPOWNER, OPERATOR, MASTER, OR ANY AGENT OF THE
VESSEL, FOR CREW'S WAGES, FOR GENERAL AVERAGE, FOR
SALVAGE, AND, TO THE EXTENT SUBORDINATE TO THE
LIEN OF SAID MORTGAGE, FOR CERTAIN LIENS INCIDENT
TO CURRENT OPERATIONS OR FOR REPAIRS OR CHANGES
PERMITTED BY THE MORTGAGE.O
23. TRANSFER OF ASSIGNMENT.
Charterer shall not, without Owner's and the
Vessel Lender's prior written consent, sell, demise,
charter, transfer, or assign this Charter or any
interest therein, or, without such consent, make any
arrangement whereby the maintenance, management, or
operation of the Vessel is to be performed by any other
person, except with respect to requisition or other
governmental taking, and except that Charterer may
subcharter the Vessel on a time basis as long as
Charterer shall, at its own cost and expense, comply
with Section 9.02(b) of the Loan Agreement; provided
that, notwithstanding such subcharter, Charterer
remains fully liable for all of its obligations under
the Charter Documents. Xxxxxxxxx shall have the right
to voyage charter the Vessel, or to arrange for space
or slot charters of a portion of the Vessel in
connection with Xxxxxxxxx's normal liner service.
24. EVENTS OF DEFAULT AND REMEDIES.
(a) The following shall constitute an event
of default under this Charter (hereinafter called a
OEvent of DefaultO):
(i) Xxxxxxxxx's failure to pay the whole or
any part of any Charter Hire or Supplemental
Charter Hire under the terms of this Charter
and such default remains unremedied for three
(3) Business Days after the due date thereof;
or
(ii) default by Charterer in the due and
punctual observance and performance of
Charterer's obligations under SECTION 22, the
third sentence of SECTION 25, SECTION 26(b),
c), (d) or (g) of this Charter, Sections
15(b), 16, 21(y) and (z), 23, 29(a), (b), (f)
and (j) of the Mortgage (and to the extent
that such default exposes the Vessel to
forfeiture, Sections 21(x) and 22 of the
Mortgage); or
(iii) any insurance on the Vessel required to
be maintained by Charterer in performance of
Owner's obligations is canceled due to non-
payment of premiums and otherwise not
immediately replaced or the Vessel otherwise
ceases to be insured in accordance with the
provisions of the Mortgage on the Vessel; or
(iv) default by Charterer (other than as
specified in paragraphs (ii) and (iii) of
this SECTION 24(a) in the due and punctual
performance of Owner's obligations under
SECTION 26(e), (f), (g), (h) and (i) of this
Charter and Charter's performance of Owner's
obligations under Sections 18, 21, 22, 24,
25, 26, 28, 50(a) and (b) and 51 of the
Mortgage, in each case, which shall continue
for thirty (30) days after written notice
from the Agent, Owner or Charter Guarantor.
(v) an "Event of Default" under any other
[HDW] [Daewoo] Charter or under any [HDW]
[Daewoo] Charter.
(vi) Charterer or Charter Guarantor is in
breach in the performance or observance of
this Charter, the Charter Hire Guarantee or
any other of the Operative Documents to which
either of them is a party (not being a
default which falls within paragraphs (i),
(ii), (iii), (iv) or (v) of this SECTION
24(a)) and if it is capable of being remedied
and such breach is not remedied within thirty
(30) days after receipt by Charterer of
notice of such breach from Owner or (so long
as the Mortgage is in effect), the Agent; or
(vii) Charterer or any of its Subsidiaries
which is a party to a Charter or Charter
Guarantor is in default in the payment when
due of any sum or sums which aggregate in
excess of Five Million Dollars (USD5,000,000)
at any one time under any documentation
relating to any other Financial Indebtedness
whatsoever (excluding for this purpose the
HDW Tranche and the Daewoo Tranche), and such
Financial Indebtedness shall have been
accelerated in accordance with the terms
thereof; or
(viii) there is a final, unappealable and
enforceable judgment made against Charterer,
any of Charterer's Subsidiaries which is a
party to a Charter or Charter Guarantor
greater than 5% of the Tangible Net Worth of
Charter Guarantor; or
(ix) any representation or warranty made by
or on behalf of Charterer or Charter
Guarantor in this Charter or in any of the
Operative Documents or by Charterer or
Charter Guarantor in any certificate,
statement or other document issued by or on
behalf of Charterer or Charter Guarantor
pursuant to any of the Operative Documents
shall prove to have been incorrect or
misleading in any material respect when made
or deemed made; or
(x) without the prior written consent of
Owner and (so long as the Mortgage remains in
effect) the Agent, there is a merger of
Charterer or Charter Guarantor otherwise than
as permitted under the Operative Documents;
or
(xi) any license, authorization, consent or
approval at any time necessary to enable
Charterer or Charter Guarantor to comply with
its obligations under this Charter, the
Charter Guarantee or any of the other
Operative Documents is revoked or not granted
or fails to remain in full force and effect
for a period of thirty (30) days after notice
thereof from Owner and (while the Mortgage is
in effect) the Agent with respect to the
Vessel; or
(xii) Charterer or Charter Guarantor shall
(i) file, or consent by answer or otherwise
to the filing against it of, a petition for
relief or reorganization or arrangement or
any other petition in bankruptcy, for
liquidation or seek any relief or forbearance
under any bankruptcy or insolvency or other
similar law, (ii) make an assignment for the
benefit of creditors, or (iii) consent to the
appointment of a custodian, receiver, trustee
or other officer with similar powers with
respect to itself or any substantial part of
its property; or
(xiii) a court or governmental authority of
competent jurisdiction in an involuntary case
under applicable bankruptcy laws, as now or
hereafter constituted, or any insolvency or
similar law, shall enter an order appointing,
without consent by Charterer or Charter
Guarantor, a custodian, receiver, trustee or
other officer with similar powers with
respect to Charterer or Charter Guarantor or
with respect to any substantial part of
Charterer's or Charter Guarantor's property,
or constituting an order for relief or
approving a petition for relief or
reorganization or any other petition in
bankruptcy or for liquidation or to take
advantage of any bankruptcy or insolvency law
of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of
Charterer or Charter Guarantor, and any such
order or petition is not dismissed or stayed
within sixty (60) days after the earlier of
the entering of any such order or the
approval of any such petition; or
(xiv) default by Charterer of its obligations
under SECTION 26(a) of this Charter.
(b) If an Event of Default shall have
occurred and be continuing:
(i) Upon declaration by Owner by notice in
writing to Charterer, Owner shall be
immediately entitled to payment of all
amounts which are due and payable under this
Charter and, as damages for loss of a bargain
and not as a penalty, whichever in the
following amounts Owner, in its sole
discretion, shall specify: (A) that sum with
respect to the Vessel which shall be equal to
the excess, if any, of (1) the present value
of the unpaid balance of total Charter Hire
which would otherwise have been paid over the
Charter Period but for such declaration by
Owner, discounted a rate of 6% per annum over
(2) the fair market rental value of the
Vessel, as determined by Owner, for the
period from the date of such Owner's
declaration to the date the Charter would
have terminated but for such declaration, or
(B) that sum with respect to the Vessel which
shall be equal to the excess, if any, of (1)
the amount specified in subclause A (1) above
over (2) the amount Owner estimates to be the
fair market sale value of the Vessel;
provided that, (C) in the event Owner shall
have sold the Vessel, in lieu of collecting
any amounts payable to Owner by Charterer
pursuant to the preceding clauses (A) or (B)
of this Section 24(b)(i), Owner, if it shall
so elect, may demand that Charterer pay
Owner, as liquidated damages for loss of a
bargain and not as a penalty, an amount equal
to the excess, if any, of (1) the amount
specified in subclause A(1) above over (2)
the net proceeds of such sale, plus interest
on the unpaid balance of any such excess
amounts immediately payable to Owner by
Charterer pursuant to clauses (A), (B) or (C)
at the Default Interest Rate commencing on
the date of such declaration by Owner to the
date of payment; provided, further, if an
Event of Default hereunder shall have
occurred and be continuing hereunder and if
the Vessel Lender shall have declared or
shall have been deemed to have declared the
whole or any part of the outstanding
principal amount of the [HDW] [Daewoo] Notes
with respect to the Subportion relating to
the Vessel to be immediately due and payable
by Owner pursuant to Section 12.01 of the
Loan Agreement and Section (31) of the
Mortgage, the amount immediately payable
hereunder shall in all events be not less
than the principal amount and interest on
such accelerated [HDW] [Daewoo] Notes
together with interest from the date of such
declaration to the date of payment on overdue
principal at the Default Interest Rate plus
any other amounts comprising Basic Hire due
and payable;
(ii) Upon such declaration or deemed
declaration of acceleration pursuant to
clause (i) hereof, Owner may:
(A) Institute and prosecute any
judicial, extra judicial, or administrative
proceedings as it may consider appropriate to
recover any or all sums due, or declared due,
with respect to Charter Hire and with respect
to any Supplemental Charter Hire due, with
the right to enforce payment of said sums
against any assets of Charterer;
(B) Owner may take possession of the
Vessel, with or without legal proceedings, at
any place where the Vessel may be found (and
Charterer shall forthwith surrender
possession of the Vessel to Owner on demand);
and
(C) Owner may terminate Xxxxxxxxx's
rights under this Charter.
(c) In case there shall be pending
proceedings for the bankruptcy or for the
reorganization of Charterer under any applicable law or
in connection with the insolvency of Charterer or in
case a receiver or trustee shall have been appointed
for its property or its creditors, Owner, irrespective
of whether Charter Hire shall then be due and payable
as herein expressed or by declaration of acceleration
or otherwise, shall be entitled and empowered to
intervene in such proceedings or otherwise, to file and
prove a claim or claims for the whole amount of Charter
Hire or Supplemental Charter Hire owing and unpaid, and
to file such other papers or documents as may be
necessary or advisable in order to have the claims of
Owner allowed in any judicial proceeding relative to
Charterer, its creditors, or its property, and to
collect and receive any money or other property payable
or deliverable on any such claims. Nothing contained
in this Charter shall be deemed to give Owner any right
to accept or consent to any plan of reorganization or
otherwise by action of any character in any such
proceeding to waive or change in any way any right of
any Holder.
(d) No right or remedy herein conferred upon
or reserved to Owner is intended to be exclusive of any
other right or remedy, and every right and remedy
shall, to the extent permitted by law, be cumulative
and, in addition to every other right and remedy given
hereunder or under the other Charter Documents or now
or hereafter existing at law, in equity, in admiralty,
by statute or otherwise. The assertion or employment
of any right or remedy hereunder or otherwise shall not
prevent the concurrent or subsequent assertion or
employment of any other right or remedy hereunder or
otherwise.
(e) No delay or omission of Owner to
exercise any right or remedy accruing upon any Event of
Default nor any course of dealings between Owner and
Charterer shall impair any such right or remedy or
constitute a waiver of any Event of Default or an
acquiescence therein nor shall any single exercise or
partial exercise of any such right or remedy preclude
any other exercise thereof or any exercise of any other
or further right or remedy; nor shall the acceptance by
Owner of any security or any payment of any part of
Charter Hire or Supplemental Charter Hire maturing
after any Event of Default or of any payment on account
of any past default be construed to be a waiver of any
right to take advantage of any future Event of Default
or of any past Event of Default not completely cured
thereby. Every right or remedy given by this Charter
or any other Charter Document or by law to Owner may be
exercised from time-to-time, and as often and in such
order as may be deemed expedient, by Owner.
(f) In case Owner shall have proceeded to
enforce any right, power or remedy under this Charter
or under any other Charter Document, and such
proceeding shall have been discontinued or abandoned
for any reason or shall have been adversely determined
to Owner, then, and in every such case, Charterer and
Owner shall be restored to their former positions and
rights hereunder with respect to the property subject
or intended to be subject to this Charter or any other
Charter Documents, as the case may be, and all rights,
remedies and powers of Owner shall continue as if no
such proceedings had been taken.
(g) Subject to the provisions of Section
24(b) hereof, Owner shall have the right to direct the
time, method and place of conducting any proceeding for
any remedy available to Owner under this Charter or any
other Charter Document.
(h) Charterer hereby expressly waives demand
and presentment for payment, notice of nonpayment,
protest, notice of protest, notice of dishonor,
bringing of suit, and diligence in taking any action to
collect amounts called for under this Charter at any
time in connection herewith.
(i) No right or remedy herein conferred upon
or reserved to Owner is intended to be exclusive, but
cumulative and in addition to any other right and
remedy given hereunder or under the other Charter
Documents.
25. SPECIAL CONDITIONS; SUBORDINATION TO THE LIEN
OF THE MORTGAGE.
(a) During the period of this Charter,
Charterer may substitute its own stack marks and
insignia for those of Owner on the Vessel.
(b) Owner shall effect initial registry of
the Vessel in the official name designated by
Charterer.
(c) This Charter and each and every
provision hereof shall be subject and subordinate to
each and every provision of the Mortgage in each and
every right and any remedy of any party hereto is
subject and subordinate to each and every right and
remedy of any party to the Mortgage. Any lien of
Charterer against the Vessel for breach of this Charter
(whether pleaded and proved as a tort or otherwise)
shall be subject and subordinate to the lien of the
Mortgage. Xxxxxxxxx agrees not to take any action
under this Charter or otherwise which would violate, or
cause Owner to violate, any provisions of the Mortgage.
Charterer shall establish and maintain, or if
appropriate, require Owner to establish and maintain
(i) the Mortgage and any Replacement Mortgage(s) to be
valid and enforceable and duly registered on the Vessel
having the priority of record required under the terms
of the Operative Documents, (ii) each Security
Document, and the liens or security interests created
or intended to be created thereunder to be and remain
in full force and effect. Owner agrees to execute such
documents and furnish such information as Charterer may
request in order to assist Xxxxxxxxx in the discharge
of Charterer's obligations as set forth in the
preceding sentence of this Section 25. In addition to
all other obligations assumed by Charterer hereunder,
Charterer will at all times, and at its own expense,
comply with and discharge Owner's obligations, and
shall be entitled to all the benefits and rights of
Owner, under the following sections of the Mortgage,
all in accordance with the provisions of said sections:
(i) Section (18) with respect to notice of Events of
Default, (ii) Section (21) with respect to operation of
the Vessel in accordance with law, (iii) Section (23)
with respect to the maintenance of the Mortgage, (iv)
Section 25(c) with respect to dealing with the Vessel's
equipment (in connection with which Charterer may act
without Owner's consent whenever Mortgagee consent is
not required), and (v) Sections (28), (50)(a) and (b)
and (51) with respect to the payment or reimbursement
of expenses.
26. COVENANTS OF CHARTERER.
Charterer shall take whatever action is
necessary (not contrary to applicable law and not
contrary to the maintenance of the separate corporate
status of each of such Subsidiaries) as to any of its
Subsidiaries which is a party to a Charter, to:
(a) prevent any of such Subsidiaries from
voluntarily or involuntarily committing or being
subjected to an OEvent of BankruptcyO and will not
suffer any of such Subsidiaries voluntarily or
involuntarily to commit or be subjected to an Event of
Bankruptcy. For the purposes of this SECTION 26(a), an
"Event of Bankruptcy" shall mean any of the events
relating to such Subsidiaries described in SECTION
24(a)(xii) and (xiii) of this Charter;
(b) cause any of such Subsidiaries not to
breach any of its representations and warranties as to
ownership, possession, mortgages, security interests
and lien status and its obligations to defend and hold
harmless the Mortgagee of such Vessels in respect
thereof as required under the first paragraph of
Section 14 of the Mortgages;
(c) prevent, and not suffer any of such
Subsidiaries to, breach any of such Subsidiaries'
obligations under Section 17 of the Mortgage;
(d) prevent, and not suffer any of such
Subsidiaries, to breach any of such Subsidiaries'
representations and warranties under Section 20(a) of
the Mortgage;
(e) cause such Subsidiaries faithfully to
observe all covenants and conditions set forth in
Section 20(b) and (c) of the Mortgage;
(f) cause such Subsidiaries to comply
faithfully with the provisions of Section 25 of the
Mortgage;
(g) cause such Subsidiaries to comply
faithfully with the provisions of Section 27 of the
Mortgage;
(h) cause such Subsidiaries to obtain and
maintain in full force and effect all licenses,
authorizations, consents and approvals to enable them
to comply with their obligations under this Charter and
the other Operative Documents;
(i) cause such Subsidiaries to remedy any
breach of any of the Operative Documents not mentioned
in paragraphs (a) through (h) of this SECTION 26,
except the failure or breach of any of such
Subsidiaries to pay Vessel Indebtedness in respect of
any Vessel.
27. OWNERSHIP.
So long as this Charter shall be in effect,
Xxxxxxxxx's interest in the Vessel shall be solely that
of a bareboat charterer. There shall be no option to
purchase or other right to acquire a legal or equitable
ownership interest in the Vessel permitted or impled so
long as this Charter shall be in effect. Any contract
or implied right of Charterer to a legal or equitable
interest in the Vessel made or given while this Charter
is in effect shall be void and unenforceable.
28. AMENDMENT.
This Charter shall be binding upon, in or to
the benefit of and enforceable by the parties hereto
and their respective successors and assigns. Neither
this Charter nor any provision hereof may be amended,
modified, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party
against which enforcement of the amendment,
modification, waiver, discharge or termination is
sought; provided that no such amendment, modification,
waiver, discharge or termination shall be made without
the prior written consent of the Vessel Lender.
29. APPLICABLE LAW.
This Charter shall be construed and governed
in accordance with the admiralty and maritime law of
the United States of America and where applicable the
law of the State of New York (other than the law of the
State of New York governing choice of law).
30. NOTICES.
All notices or other communications by either
party to the other shall be in writing. If such notice
is to Charterer, it shall be addressed to:
American President Lines, Ltd.
0000 Xxxxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Telex: 671 4840
Answerback: APL OAK
Attention: Treasurer
If to Owner, it shall be addressed to:
M.V. President Xxxxxxx, Ltd.
0000 Xxxxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Telex: 671 4840
Answerback: APL OAK
Attention: Treasurer
Any notices or communications provided for
herein shall be deemed to have been given, unless
otherwise expressly provided herein, at the time
of mailing when (in the case of telex) the
addressee's answerback shall have been received at
the end of the transmission thereof or (in the
case of any letter) when delivered to that address
by facsimile or personally) or when actually
received by the relevant party after being
deposited in the post, first class, postage
prepaid, in an envelope addressed as above. Any
party shall have the right to change the address
at which it is to receive notices upon fifteen
(15) days prior written notice.
31. CONSENT TO ASSIGNMENT.
Charterer hereby consents to the assignment
of all of Owner's rights, title and interest in and to
this Charter to the Vessel Lender pursuant to the [
] Charter Assignment as security for the payment and
performance of the Owner Obligations with respect to
the Vessel and agrees to make all payments due
hereunder to the accounts specified and otherwise in
accordance with Section 5.06 of the Loan Agreement,
except that so long as no Event of Default shall have
occurred and be continuing, Charterer may make payments
of Additional Charter Hire directly to Owner.
IN WITNESS WHEREOF, the parties hereto have caused
this Charter to be executed the day and year first
above written.
[ ],
as Owner
By:
__________________________
Title:
AMERICAN PRESIDENT
LINES, LTD.,
as Charterer
By:
___________________________
Title:
RECEIPT OF ORIGINAL EXECUTED
COUNTERPART ACKNOWLEDGED:
[ ]
By: _______________________________
EXHIBIT A-1
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
Omitted pursuant to Instruction 2 to Item 601 of
Regulation S-K. Same as Exhibit I to Exhibit A to the
Agreement to Acquire and Charter filed as Exhibit 10.6
with Registrant's Form 10-Q for the quarter ended April
8, 1994, except the recitals refer to the Second
Amended and Restated Agreement to Acquire and Charter
dated September 1, 1995 and related documents.
EXHIBIT B-1
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
__________, 199 _
Kreditanstalt fur Wiederaufbau
Xxxxxxxxxxxxxxxxxxx 0-0
00000 Xxxxxxxxx xx Xxxx
Xxxxxxx Xxxxxxxx xx Xxxxxxx
RE: Container Xxxxxx Named __________,
Identified by Howaldtswerke-Deutsche Werft AG
(the OContractorO) as Contractor's Hull
No. [297] [298] [299] (the "Vessel") - B IV a
F(W) 753
Dear Sirs:
We refer to a Second Amended and Restated
Agreement to Acquire and Charter (the OAcquisition
AgreementO) dated as of September 1, 1995, and made
between yourselves as Agent and Lender and ourselves as
Transferee (among other parties). Terms defined in the
Acquisition Agreement have the same meanings herein.
In relation to the Vessel, we hereby confirm that
we are ready to take delivery of and accept the Vessel
pursuant to [the Acquisition Agreement] [that certain
Exchange Agreement dated as of the date hereof between
__________ and ourselves].
We also confirm that the Vessel is recommended for
class "__________" with The American Bureau of Shipping
as per the photocopy or duplicate interim
classification certificate attached hereto, and that
there is no lien or encumbrance on the Vessel.
Yours faithfully,
[NAME OF TRANSFEREE]
By:
___________________________
Name:
Title:
Attachment
EXHIBIT B-2
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
__________, 199 _
Commerzbank XX
Xxxx 7-9
D-20457 Hamburg
Federal Republic of Germany
RE: Container Xxxxxx Named __________,
Identified by Daewoo Shipbuilding & Heavy
Machinery,
Ltd. (the OContractorO) as Contractor's Hull
No. [4028] [4029] [4033] (the OVesselO) - B
IV a F(W)
753
Dear Sirs:
We refer to a Second Amended and Restated
Agreement to Acquire and Charter (the "Acquisition
Agreement") dated as of September l, 1995, and made
between yourselves as Syndicate Agent and ourselves as
Transferee (among other parties). Terms defined in the
Acquisition Agreement have the same meanings herein.
In relation to the Vessel, we hereby confirm that
we are ready to take delivery of and accept the Vessel
pursuant to the [Acquisition Agreement] [that certain
Exchange Agreement dated as of the date hereof between
__________ and ourselves].
We also confirm that the Vessel is recommended for
class "__________" with The American Bureau of Shipping
as per the photocopy or duplicate interim
classification certificate attached hereto, and that
there is no lien or encumbrance on the Vessel.
Yours faithfully,
[NAME OF TRANSFEREE]
By:
____________________________
Name:
Title:
Attachment
EXHIBIT C
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
[HDW] [DAEWOO] [SECOND] CHARTER ASSIGNMENT
From
[ ], Assignor
To
[ ], Assignee
Dated: ____________, 199_
[HDW] [DAEWOO] [SECOND] CHARTER ASSIGNMENT
This [Second] Charter Assignment dated , 199_ is
made between (i) [ ], a Delaware corporation
(the "Assignor") and (ii) [ ], a [ ] (the
"Assignee").
W I T N E S S E T H:
WHEREAS, American President Lines, Ltd. ("APL"), a
wholly-owned subsidiary of American President
Companies, Ltd. ("APC"), has heretofore entered into
that certain Loan Agreement dated March 14, 1994, as
amended by Amendment No.1 thereto dated May 19, 1995,
as further amended by Amendment No. 2 thereto dated
September 1, 1995 (as the same may be further amended
or supplemented in accordance with its terms, the "Loan
Agreement"), by and among APL, the Assignor, the other
corporations identified as Transferees therein, the
Assignee, [Kreditanstalt fur Wiederaufbau ("KfW")]
[Commerzbank AG, Hamburg (the Syndicate Agent)], and
the banks listed on Schedule I thereto (each a
"Syndicate Member" and collectively the "Syndicate")
with respect to the purchase financing of six (6)
container vessels, including the Vessel described
below;
WHEREAS, in accordance with the Loan Agreement and
that certain Second Amended and Restated Agreement to
Acquire and Charter dated September 1, 1995 (as the
same may be further amended or supplemented in
accordance with its terms, the "Acquisition
Agreement"), among the parties to the Loan Agreement,
APL has assigned its rights to receive delivery of the
Vessel described below from [HDW] [Daewoo] to [ ]
(the "Original Owner");
WHEREAS, on the date hereof, the Original Owner
acquired the Vessel from [HDW] [Daewoo];
WHEREAS, in accordance with that certain Exchange
Agreement dated as of the date hereof between APL and
the Original Owner, APL has acquired the Vessel
described below on the date hereof from the Original
Owner;
WHEREAS, APL has [simultaneously herewith] entered
into a First Mortgage on the Vessel in favor of the
Assignee as security for the Owner Obligations referred
to [below in respect of the Vessel] [therein] [and has
also entered into a Second Mortgage on the Vessel in
favor of KfW as security for the Obligations referred
to [therein] [below]];
WHEREAS, APL has transferred the Vessel to the
Assignor and the Assignor has assumed the above-
referenced First Mortgage pursuant to that certain
Assumption of First Preferred Ship Mortgage dated the
date hereof between APL and the Assignor [and has
assumed the above-referenced Second Mortgage pursuant
to that certain Assumption of Second Preferred Ship
Mortgage dated the date hereof between APL and the
Assignor];
WHEREAS, the Assignor has accepted title to, and
is currently the registered owner of, the Republic of
The Xxxxxxxx Islands flag vessel [ ], Official
Number [ ] (the "Vessel") [and the Assignor has
undertaken all of the payment and certain of the
performance obligations relating to Vessel Indebtedness
in respect of the Vessel under the Loan Agreement (the
"Owner Obligations")];
WHEREAS, the Assignor has let and demised the
Vessel to APL as charterer (the "Charterer") and the
Charterer has hired the Vessel from the Assignor on the
terms and conditions set forth in the Bareboat Charter
Party dated the date hereof (the "Charter"), such
charter of the Vessel being effective upon the
execution and delivery of the Charter;
[WHEREAS, pursuant to that certain Charter Hire
Guarantee executed by APC in favor of the Assignor (the
"Charter Hire Guarantee"), APC has guaranteed the
Charterer's obligations to pay Charter Hire and
Supplemental Charter Hire under the Charter;]
[WHEREAS, as contemplated by the Acquisition
Agreement, the Assignor is entering into a Charter
Assignment relating to the Charter in favor of the
Syndicate Agent (the "Charter Assignment");]
WHEREAS, as contemplated by the Acquisition
Agreement, the Assignor is entering into this [Second]
Charter Assignment relating to the Charter in favor of
the Assignee, and the Charterer is consenting to such
[Second] Charter Assignment pursuant to the Charter;
WHEREAS, capitalized terms used herein but not
defined herein shall have the meanings assigned to them
in the Loan Agreement and the Acquisition Agreement.
NOW, THEREFORE, in consideration of the premises
and the mutual covenants contained herein and other
good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties
hereto agree as follows:
1. The Assignor hereby sells, pledges,
hypothecates, assigns, transfers and sets over unto the
Assignee and unto the Assignee's successors and
assigns, not absolutely but as security only for the
payment and performance [by the Assignor] of the [Owner
Obligations] [Obligations (as defined in the Second
Mortgage) and any other obligations secured by the
Second Mortgage (the "Owner Obligations")], and grants
to the Assignee a [first] [second] priority security
interest in all right, title and interest of the
Assignor in and to (i) the Charter [and the Charter
Hire Guarantee], all monies due and to become due and
claims for monies due and to become due, and all claims
for damages arising out of the breach of, the Charter
[and the Charter Hire Guarantee], together with any
extensions, renewal modifications, changes or
amendments of the Charter [and the Charter Hire
Guarantee], (ii) the rights, if any, of the Assignor as
a secured party in and to the Vessel under the Charter,
and (iii) any and all proceeds of the foregoing [;
provided, however, that until an Event of Default (as
that term is defined in the Loan Agreement and the
First Mortgage) shall have occurred and be continuing
and an Event of Default under the Charter (as defined
therein) has occurred and is continuing all payments of
Additional Charter Hire payable under the Charter may
be made directly to the Assignor].
2. The Assignor hereby agrees, represents and
warrants that:
(a) [Each of] the Charter [and the Charter Hire
Guarantee] is in full force and effect and enforceable
in accordance with its terms;
(b) The Assignor is not in default of any of the
terms of the Charter;
(c) Neither the whole nor any part of the right,
title and interest hereby assigned are the subject of
any present assignment or pledge other than the
assignment contained herein [and the Second Charter
Assignment in favor of Kreditanstalt fur Wiederaufbau],
and so long as this [Second] Charter Assignment shall
remain in effect, the Assignor will not, without the
prior written consent thereto of the Assignee, assign
or pledge the whole or any part of the right, title and
interest hereby assigned to anyone other than the
Assignee, its successors or assigns;
(d) The Assignor will not take or omit to take
any action, the taking or omission of which might
result in any alteration or impairment of the Charter[,
the Charter Hire Guarantee] or this [Second] Charter
Assignment or any of the rights created by the
Charter[, the Charter Hire Guarantee] or this [Second]
Charter Assignment;
(e) To the knowledge of the Assignor, the
Charterer is not in default of any of the terms of the
Charter;
(f) [Subject to the rights of the Syndicate Agent
under the Charter Assignment] [The] Assignor will not
enter into or consent to any amendment, modification or
other alteration of the Charter [or the Charter Hire
Guarantee] without first obtaining the prior written
consent of the Assignee. Any amendment, modification
or other alteration made without the written consent of
the Assignee shall be null and void.
(g) In case there shall be pending proceedings
for the bankruptcy or for the reorganization of the
Charterer under any applicable law or in connection
with the insolvency of the Charterer, its property or
its creditors, the Assignee, irrespective of whether
Charter Hire (as defined in the Charter) shall then be
due and payable as provided in the Charter or by
declaration of acceleration or otherwise, shall be
entitled and empowered to intervene in such proceedings
or otherwise, to file and prove a claim or claims for
all amounts required to be paid by Charterer under the
Charter following such declaration owing and unpaid,
and to file such other papers or documents as may be
necessary or advisable in order to have the claims of
the Assignor allowed in any judicial proceeding
relative to the Charterer, its creditors, or its
property, and to collect and receive any money or other
property payable or deliverable on any such claims, and
to have the same applied pursuant to Section [5.09(a)]
[5.09(b)] of the Loan Agreement. Nothing contained in
this [Second] Charter Assignment shall be deemed to
give the Assignee any right to accept or consent to any
plan of reorganization or otherwise by action of any
character in any such proceeding to waive or change in
any way any right of any Holder.
(h) Any monies collected by the Assignor pursuant
to enforcement of any of its rights under the Charter[,
the Charter Hire Guarantee] or under any other Charter
Document on account of the occurrence of an Event of
Default by or on behalf of the Assignor shall be
payable to the Assignee and distributed in accordance
with Section [5.09(a)] [5.09(b)] of the Loan Agreement.
3. Notwithstanding this Assignment, it is
acknowledged, understood and agreed that:
(a) The Assignor will remain liable to perform
all of the owner's obligations and duties under the
Charter.
(b) The Assignor will be deemed the owner under
the Charter except as expressly set forth herein.
(c) The Assignee shall have no obligation or
liability under or pursuant to the Charter by reason of
or arising out of this Assignment, nor to present or
file any claim, nor to take any other action to collect
or enforce the performance obligations of the Charterer
or payment of any amounts which have been assigned to
the Assignee or to which the Assignee may be entitled
under this [Second] Charter Assignment at any time or
times;
(d) So long as no Event of Default (as that term
is defined in the Loan Agreement and the First Mortgage
[and the Second Mortgage]) has occurred, is continuing
and shall not have been cured and waived and no Event
of Default under the Charter (as defined therein) has
occurred and is continuing, neither the Assignee, the
Assignor nor any successor thereof shall interfere with
the Charterer's possession and its peaceful and quiet
enjoyment of the Vessel.
4. The Assignor confirms to the Assignee its
authorization and direction to the Charterer in the
Charter to make payment of all monies due and to become
due under or arising out of the Charter at the time and
in the manner set forth in Section 2(b) of the Charter.
5. The Assignor does hereby constitute the
Assignee, its successors and assigns, the Assignor's
true and lawful attorneys, irrevocably, with full power
(in the name of the Assignor or otherwise), upon an
Event of Default under the Loan Agreement or the First
Mortgage [or the Second Mortgage], and in accordance
therewith, to ask, require, demand, receive, compound
and give acquittance for any and all monies, and claims
for monies and rights hereby assigned, to endorse any
checks or other instruments or orders in connection
therewith and to file any claims or take any action or
institute any proceedings which the Assignee may deem
to be necessary or advisable in the premises.
6. The Assignor hereby irrevocably authorizes
the Assignee, at the Assignor's expense, to file such
financing and continuation statements relating to this
[Second] Charter Assignment without the Assignor's
signature, as the Assignee at its option may deem
appropriate and appoints the Assignee as the Assignor's
attorney-in-fact to execute any such statements in the
Assignor's name and to perform all other acts which the
Assignee may deem appropriate to perfect and continue
the security interest conferred hereby.
7. The assignment of the Charter [and the
Charter Hire Guarantee] to the Assignee provided for
herein shall take effect immediately upon the execution
hereof and the powers and authorities granted to the
Assignee, its successors or assigns herein, having been
given for valuable consideration, are hereby declared
to be irrevocable.
8. The Assignor hereby agrees that at any time
and from time to time, upon the written request of the
Assignee, its successors and assigns, it will promptly
and duly execute and deliver any and all such further
instruments and documents as the Assignee, its
successors or assigns, may reasonably require in order
to obtain the full benefits of this [Second] Charter
Assignment and of the rights and powers herein granted.
9. This [Second] Charter Assignment shall be
governed by the laws of the State of New York (other
than the law of the State of New York governing choice
of law) and may not be amended or changed except by an
instrument in writing signed by the party against whom
enforcement is sought.
10. The Assignor hereby authorizes the Assignee
to execute and file financing statements and amendments
thereto as provided in Article 9 of the Uniform
Commercial Code.
11. Notwithstanding any other provision of this
[Second] Charter Assignment, this [Second] Charter
Assignment shall terminate, be void and of no further
effect upon the payment in full of the Owner
Obligations, together with payment of all other amounts
then due and owing secured by the First Mortgage [and
the Second Mortgage; provided, however, that, in any
event, this Second Charter Assignment shall terminate
upon termination of the Second Mortgage in accordance
with its terms].
IN WITNESS WHEREOF, the Assignor has caused this
instrument to be duly executed as of the day and year
first above written.
[ ]
By:____________________
Title:
EXHIBIT D
TO SECOND AMENDED AND
RESTATED AGREEMENT TO
ACQUIRE AND CHARTER
CHARTER HIRE GUARANTEE
dated as of , 199_
by
AMERICAN PRESIDENT COMPANIES, LTD.
(as Guarantor)
in favor of
[_____________________________]
(as Obligee)
CHARTER HIRE GUARANTEE, dated as of [ ], l99_, by
AMERICAN PRESIDENT COMPANIES, LTD., a Delaware corporation
(the "Guarantor"), in favor of [ ] (the
"Obligee"). Capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in the
Second Amended and Restated Agreement to Acquire and Charter
dated September 1, 1995 (the "Acquisition Agreement"), by
and among Kreditanstalt fur Wiederaufbau, a corporation
organized and existing under the laws of the Federal
Republic of Germany whose address is Xxxxxxxxxxxxxxxxxxx 0-
9, Postfach 11-11-41, D-60325 Frankfurt am Main ("KfW"),
COMMERZBANK AG (HAMBURG), a banking corporation incorporated
in the Federal Republic of Germany whose address is Ness 7-
9, D-20457 Hamburg, (the "Syndicate Agent") and the banks
listed in Schedule 1 which is attached hereto (KfW, the
Syndicate Agent, and the banks listed in such Schedule 1 are
hereinafter referred to collectively as the "Banks"), the
corporations listed as Transferees therein (the
"Transferees") and American President Lines, Ltd., a
Delaware corporation (the "Charterer").
W I T N E S S E T H:
WHEREAS, in accordance with the Acquisition Agreement,
APL has assigned its rights to receive delivery of the
Vessel described below from [HDW] [Daewoo] to [ ] (the
"Original Owner");
WHEREAS, the Obligee has accepted title to, and is
currently the registered owner of, The Republic of The
Xxxxxxxx
Islands flag vessel [________], Official Number [_______]
(the "Vessel"), and the Obligee has undertaken all of the
payment and certain of the performance obligations relating
to Vessel Indebtedness in respect of the Vessel under the
Loan Agreement, (the "Owner Obligations");
WHEREAS, in accordance with that certain Exchange
Agreement dated as of the date hereof between the Obligee
and the Original Owner (the "Exchange Agreement"), the
Obligee has acquired the Vessel described below on the date
hereof from the Original Owner;
WHEREAS, the Obligee has simultaneously herewith
entered into a First Mortgage on the Vessel in favor of
[KfW] [the Syndicate] (the "Vessel Lender"), as security for
the Owner Obligations in respect of the Vessel;
[WHEREAS, the Obligee has simultaneously herewith
entered into a Second Mortgage on the Vessel in favor of
KfW, as security for the Obligations of the Obligee referred
to therein;]
WHEREAS, the Obligee has let and demised the Vessel to
the Charterer and the Charterer has hired the Vessel from
the Obligee on the terms and conditions set forth in the
Bareboat Charter Party, dated the date hereof (the
"Charter"), such charter of the Vessel being effective upon
the execution and delivery of the Charter;
WHEREAS, the Guarantor is entering into this Guarantee
in consideration of the Banks entering into the Acquisition
Agreement and purchasing the Notes.
Accordingly, the Guarantor hereby agrees with the
Obligees as follows:
SECTION 1. GUARANTEE
1.1 The Guarantee. The Guarantor hereby guarantees as
primary obligor and not as a surety the full and punctual
payment of all amounts payable by the Charterer under the
Charter. Upon failure by the Charterer to pay punctually
any such payment required by it to be paid within any
applicable grace periods permitted under the Charter, the
Guarantor shall forthwith on demand pay the amount not so
paid in immediately available funds as specified therein.
Upon payment by the Guarantor of any obligation of the
Charterer pursuant to this Section 1.1, such obligation with
respect to such payment under the Charter shall terminate.
1.2 Guarantee Unconditional. The obligations of the
Guarantor hereunder shall be irrevocable, unconditional and
absolute without regard to:
(a) any amendment, consent or release in respect
of any of the terms of the Charter or of the
obligations under any thereof of any Person (provided
only that such amendment, consent or release is
effected in accordance with the terms of the Charter);
or
(b) any taking, holding, exchange, release,
non-perfection or invalidity of any direct or indirect
security for any obligation of the Charterer under the
Charter; or
c) any change in the corporate existence,
structure or ownership of the Charterer, or any
insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Charterer or its assets; or
(d) the existence of any claim, setoff or other
rights which the Guarantor may have at any time against
the Charterer; or
(e) any defense arising by reason of any
invalidity, unenforceability or other defense of the
Charterer, or other defense of the Guarantor or by
reason of the cessation from any cause whatsoever of
the liability either in whole or in part of the
Charterer to pay any amount payable by it under the
Charter; or
(f) any consent, release, renewal, refinancing,
refunding, amendment or modification of or addition or
supplement to or waiver of any of the terms of the
Charter or of any other agreement which may be made
relating to the Charter or of the obligations under any
thereof of any Person (provided only that such consent,
release, renewal, refinancing, refunding, amendment or
modification of or addition or supplement to or waiver
is effected in accordance with the terms of the
Charter); or
(g) any exercise or non-exercise of any right,
power, privilege or remedy under or in respect of this
Guarantee or the Charter, or any waiver of any such
right, power, privilege or remedy or of any default in
respect of the Charter, or any receipt of any
collateral security or any sale, exchange, surrender,
release, discharge, failure to perfect or to continue
perfected, loss, abandonment or alteration of, or other
dealing with, any collateral security by whomsoever at
any time pledged or mortgaged to secure, or however
securing, any of the Guarantor's obligations or any
liabilities (including liabilities of the Guarantor
hereunder) incurred directly or indirectly in respect
thereof.
1.3 Discharge Only Upon Payment in Full;
Reinstatement in Certain Circumstances. The Guarantor's
obligations hereunder shall remain in full force and effect
until the amounts payable by the Charterer under the Charter
shall have been paid in full or the obligations of the
Charterer thereunder have otherwise terminated, whichever is
earlier. If at any time any amount payable by the Charterer
under the Charter is rescinded or must be otherwise restored
or returned upon the insolvency, bankruptcy or
reorganization of the Charterer or otherwise, the
Guarantor's obligations hereunder with respect to such
payment shall be reinstated at such time as though such
payment had not been made.
1.4 Waiver. The Guarantor irrevocably waives
acceptance of this Guarantee, presentment, demand except as
required pursuant to Section 1.1 hereof, protest, and
notice, as well as any requirement that at any time any
action be taken by any Person against the Charterer or any
other Person.
1.5 Subrogation. Upon making any payment
hereunder, the Guarantor shall be subrogated to the rights
of the Obligee under the Charter against the Charterer
with respect to such payment; provided that the
Guarantor shall have no right of subrogation and
waives, to the fullest extent permitted by applicable law,
any right to any security in the Vessel which is the subject
of the Charter and to exercise any remedy which the Obligee
has or may hereafter have against the Charterer for payment
of money until all amounts payable by the Charterer under
the Charter have been paid in full or the obligations of the
Charterer thereunder have otherwise terminated, whichever is
earlier. Nothing contained in this Guarantee shall preclude
the Guarantor from causing the Charterer to make payments
required by the Charterer under the Charter.
1.6 Payment Guarantee: No Set-Off or Deductions:
No Waiver. The Guarantor hereby agrees that (a) this
Guarantee is a guarantee of payment and not of collection,
and shall continue in full force and effect and be binding
upon the Guarantor, its successors and assigns; and (b)
amounts payable hereunder shall be paid when due without
set-off or reduction for any reason whatsoever; provided,
however, that nothing contained in this Section shall be
construed to be a waiver, modification, alteration or
release of any claims which the Guarantor may have for
damages or equitable relief for any breach by the Obligee of
any provision of the Charter or for any loss due to any acts
taken by the Obligee thereunder.
1.7 Obligations Unaffected. The Obligee may, at any
time and from time to time, without the consent of, or
notice to, the Guarantor, without incurring responsibility
to the Guarantor and without impairing, diminishing, or
discharging, releasing, suspending, prejudicing or
terminating the obligations of the Guarantor hereunder, in
accordance with the terms and conditions of the Charter and
in whole or in part, take or refrain from taking (either
directly or indirectly) any and all actions with respect to
the Guarantor's obligations, this Guarantee, the Charter,
any collateral security at any time granted or received for
any of the Guarantor's obligations, or any Person (including
any Guarantor) that the Obligee determines in its sole
discretion to be necessary or appropriate, whether or not
such action or refraining from action varies or increases
the risk of, the Guarantor; provided, however, that any
amount received by the Obligee as a result of any such
action shall correspondingly reduce the Guarantor's
obligations hereunder.
No right of the Obligee hereunder, and no obligation of
the Guarantor hereunder, shall be in any way limited or
otherwise impaired by the failure of the Obligee (i) to
commence any action or obtain any judgment against the
Charterer; (ii) to seek recourse against, or to perfect or
enforce any rights in and to, any collateral; (iii) to
proceed against any other guarantee relating to all or any
of the obligations guaranteed hereunder or (iv) to exercise
any other right, remedy, power or privilege hereunder or
otherwise. The Guarantor waives and agrees not to assert (a)
any right to require the Obligee to take any action
described in clauses (i) to (iv) of the immediately
preceding sentence and (b) any defense based upon an
election of remedies which destroys or impairs the
subrogation rights of the Obligee or the right of the
Obligee to proceed against the Guarantor hereunder or the
Charterer in respect of the obligations guaranteed
hereunder.
SECTION 2. Representations and Warranties of the
Guarantor. The Guarantor represents and warrants to the
Obligee that:
2.1 the Guarantor is a corporation duly organized
and validly existing in good standing under the laws of the
jurisdiction of its incorporation with full corporate power
and authority to conduct its business as the same is
presently conducted;
2.2 the Guarantor has legal power and authority to
enter into and carry out the terms of this Guarantee;
2.3 this Guarantee has been duly authorized by all
necessary action, corporate or other, on the part of the
Guarantor, and this Guarantee constitutes in accordance with
its terms, a legal, valid and binding instrument enforceable
against the Guarantor, except to the extent limited by
applicable bankruptcy, reorganization, insolvency,
moratorium or other laws of general application relating to
or affecting the enforcement of creditors' rights from time
to time in effect;
2.4 except as previously disclosed to the
Syndicate Agent and the Agent in writing, there are no
actions, suits or proceedings pending or, to the Guarantor's
knowledge, threatened against the Guarantor, which question
the validity of this Guarantee or action taken or to be
taken by the Guarantor pursuant to this Guarantee which
would, if adversely determined, materially and adversely
affect the performance by the Guarantor of its obligations
hereunder;
2.5 the execution and delivery of this Guarantee
by the Guarantor and the performance by the Guarantor of its
obligations under this Guarantee will not violate any
provisions of the Certificate of Incorporation or Bylaws of
the Guarantor and will not result in a breach of the terms
and provisions of, or constitute a default under, any other
agreement or undertaking by the Guarantor or by which it or
any of its property is bound or any order of any court or
administrative agency entered in any proceedings binding on
the Guarantor, or violate any applicable statute, rule or
regulation;
2.6 the Guarantor is not in default and no
Incipient Default has occurred, in any respect which would
materially and adversely affect the ability of the Guarantor
to perform its obligations under this Guarantee, under any
mortgage, loan agreement, deed of trust, indenture or other
agreement with respect thereto or evidence of indebtedness
to which it is a party or by which it is bound, and is not
in violation of or in default, in any respect which would
materially and adversely affect the ability of the Guarantor
to perform its obligations under this Guarantee, under any
order, writ, judgment or decree of any court, arbitrator or
governmental authority, commission, board, agency or
instrumentality, domestic or foreign;
2.7 the Guarantor has more than one place of
business and the present location of the place of business
which is its chief executive office is 0000 Xxxxxxxx,
Oakland, California 94607;
2.8 the Guarantor has no knowledge of any actual
or proposed deficiency or additional assessment in
connection with any Taxes which either in any case or in the
aggregate would be materially adverse to the Guarantor and
which would materially and adversely affect the ability of
the Guarantor to perform its obligations hereunder;
2.9 all Taxes (other than taxes based on or
measured by income and withholding taxes), liability for the
payment of which has been incurred by the Guarantor in
connection with the execution, delivery and performance by
it of each Loan Document to which it is or will be a party,
have been paid (or provided for in its accounts if not
payable on or prior to the delivery date of the respective
Vessel);
2.10 all governmental consents, licenses,
permissions, approvals, registrations or authorizations or
declarations required (i) to enable it lawfully to enter
into and perform its payment obligations under this
Guarantee and to require the Charterer to perform its other
obligations under the Charter, (ii) to ensure that its
respective obligations under clause (i) hereunder are legal,
valid and enforceable and (iii) to make this Guarantee
admissible in evidence have been obtained or made and are in
full force and effect;
2.11 it has not taken any corporate action nor to its
knowledge have any other steps been taken or legal
proceedings been started or threatened against it for its
winding-up, dissolution or reorganization or for the
appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of it or of any or
all of its respective assets and revenues;
2.12 (i) no written representation, warranty or
statement made or other document provided by the Guarantor
in connection with the negotiation of this Guarantee at the
time when given is or was untrue or contains or contained
any misrepresentation of a material fact or omits or omitted
to state any material fact necessary to make any such
statement herein or therein not misleading and (ii) all
financial projections, if any, prepared by the Guarantor and
made available to the Obligee have been prepared in good
faith based upon reasonable assumptions (it being understood
that such projections are subject to significant
uncertainties and contingencies, many of which are beyond
the Guarantor's control, and that no assurances can be given
that any such projections will be realized);
2.13 ERISA. To the best knowledge of the Guarantor
(i) each Plan maintained by the Guarantor and each ERISA
Affiliate is in substantial compliance in all material
respects with ERISA; (ii) no Plan maintained by the
Guarantor or any ERISA Affiliate is insolvent or in
reorganization; (iii) no Insufficiency or Termination Event
has occurred or is reasonably expected to occur,
and no "accumulated funding deficiency" exists and no
"variance" from the "minimum funding standard" has been
granted (each such term as defined in Part III, Subtitle B,
of Title I of ERISA) with respect to any Plan in which the
Guarantor or any of its Subsidiaries, or any ERISA Affiliate
is a participant; (iv) neither the Guarantor nor any ERISA
Affiliate has incurred, or is reasonably expected to incur,
any Withdrawal Liability to any Multiemployer Plan; (v)
neither the Guarantor, its Subsidiaries, nor any ERISA
affiliate has received any notification that any
Multiemployer Plan in which it is a participant is in
reorganization or has been terminated, within the meaning of
Title IV of ERISA and no such Multiemployer Plan is
reasonably expected to be in reorganization or terminated
within the meaning of Title IV of ERISA; (vi) no lien
imposed under the Code or ERISA on the assets of the
Guarantor or any Subsidiary or any ERISA Affiliate exists or
is reasonably expected to arise on account of any Plan;
(vii) no material liability will be incurred by the
Guarantor, its Subsidiaries, or any ERISA Affiliate if any
of them should terminate contributions to any other employee
benefit plan maintained by them;
2.14 it is not an "investment company" or a
company "controlled" by an "investment company" (as each of
such terms is defined or used in the Investment Company Act
of 1940, as amended).
SECTION 3. Covenants of the Guarantor. The
Guarantor covenants to the Obligee that:
3.1 The Guarantor will not consolidate or
amalgamate with, or merge into, any other entity, or sell,
convey, transfer, lease, or otherwise dispose of all or
substantially all of its assets, including, but not limited
to, by dividend (whether by one transaction or a series of
transactions and whether related or not); provided, however,
that it may consolidate or amalgamate with, or merge into,
any other entity, or sell, convey, transfer, lease, or
otherwise dispose of all or substantially all of its assets
if the buyer, assignee or transferee corporation (the
"Assignee") shall be a solvent corporation organized and
existing under the laws of the United States of America or
any state thereof following such transaction and shall have
executed and delivered an agreement, in form and substance
reasonably satisfactory to the Obligees, containing an
assumption by the Assignee of the due and punctual
performance and observance of all covenants and obligations
of the Guarantor hereunder, and confirming the accuracy of
any representations and warranties made herein as of the
date hereof required with respect to such Assignee; and
provided further that immediately following such
transaction, no Incipient Default or Event of Default shall
have occurred and be continuing.
SECTION 4. Financial Statements.
4.1 The Guarantor shall, as soon as possible,
provide to the Agent and the Syndicate Agent (a) but in no
event later than one hundred twenty (120) days after the end
of each fiscal year, its consolidated audited accounts of
all consolidated financial statements of the Guarantor, such
financial statements to be prepared in accordance with
generally accepted United States of America accounting
principles at such time consistently applied and a report
thereon by Xxxxxx Xxxxxxxx & Co. or other independent public
auditors of internationally recognized standing as may be
acceptable to the Agent and the Syndicate Agent, (b) copies
of all quarterly reports filed with the Securities and
Exchange Commission and, within seventy-five (75) days after
the end of the first three (3) quarters of its fiscal year,
unaudited consolidated statements of income and changes in
financial position of the Guarantor and related balance
sheets for each such period, all certified as true and
correct by a financial officer of the Guarantor, (c) as soon
as the same is instituted (or, to the knowledge of the
Guarantor threatened), details of any litigation,
arbitration or administrative proceedings against or
involving the Guarantor, the Charterer or the Vessel which
if adversely determined would have a material adverse effect
on the Guarantor, any Charterer and any of its subsidiaries
on a consolidated basis, or construction of the Vessel, and
(d) from time to time, and on demand, such additional
financial or other information relating to the Guarantor as
may be reasonably requested by the Agent or the Syndicate
Agent.
SECTION 5. Miscellaneous
5.1 No failure on the part of any Obligee to
exercise, no delay in exercising, and no course of dealing
with respect to, any right or remedy hereunder will operate
as a waiver thereof; nor will any single or partial exercise
of any right or remedy hereunder preclude any other further
exercise of any other right or remedy. This Guarantee may
not be amended or modified except by written agreement of
the Guarantor and the Obligee.
5.2 All notices or other communications required
under the terms and provisions hereof shall be made in the
manner provided in Section 15.04 of the Loan Agreement
addressed as follows: to (i) Kreditanstalt fYr Wiederaufbau
at: Xxxxxxxxxxxxxxxxxxx 0-0, X-00000 Xxxxxxxxx am Main (if
by hand), Postfach 11-11-41, D-60046 Frankfurt am Main (if
by mail), Federal Republic of Germany, Telefax No.: 7431-
2944 or 7431-2198; (ii) to Commerzbank AG at: Ness 7-9, D-
20457 Hamburg, Federal Republic of Germany, Attention:
Xxxxxx X. Xxxx, Telefax No.: 00-00-0000-0000; (iii) to the
Guarantor at: 0000 Xxxxxxxx, Xxxxxxx, Xxxxxxxxxx 00000;
Attention: Treasurer, Telefax No.: (000) 000-0000; and (iv)
to the Obligee at: 000 Xxxxxxxx, Xxxxxxx, Xxxxxxxxxx 00000.
5.3 The terms of this Guarantee shall be binding
upon, and inure to the benefit of, the Guarantor and the
Obligee and their respective successors and assigns.
5.4 No recourse shall be had for the payment of
any amount payable hereunder against any incorporator,
stockholder, officer or director, as such, past, present or
future, of the Guarantor or of any successor corporation,
either directly or through the Guarantor or any successor
corporation, whether by virtue of any constitutional
provision, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly
agreed and understood that this Guarantee is solely a
corporate obligation, and that no personal liability
whatsoever shall attach to, or be incurred by, any
incorporator, stockholder, officer or director, as such,
past, present or future, of the Guarantor or of any
successor corporation, because of the incurring of the
indebtedness hereby authorized or under or by reason of any
of the obligations, covenants, promises or agreements
contained in this Guarantee or to be implied herefrom, and
that all liability, if any, of that character against every
such incorporator, stockholder, officer and director is, by
the acceptance of this Guarantee and as a condition of, and
as part of the consideration for, the execution of this
Guarantee, expressly waived and released.
5.5 This Guarantee shall be construed in
accordance with and governed by the laws of the State of New
York (other than the law of the State of New York governing
choice of law).
5.6 The Guarantor (a) hereby irrevocably submits
itself to the jurisdiction of the Supreme Court of the State
of New York, New York County and to the jurisdiction of the
United States District Court for the Southern District of
New York for the purposes of any suit, action or other
proceeding arising out of this Guarantee or the Charter, or
the subject matter hereof or thereof or any of the
transactions contemplated hereby or thereby, brought by the
Obligee or its successors, subrogees or assigns, (b) hereby
irrevocably agrees that, all claims in respect of such
action or proceeding may be heard and determined, in such
New York State or Federal court, and (c) to the extent that
it has or hereafter may acquire any immunity from
jurisdiction of any court or from any legal process, hereby
waives such immunity, and agrees not to assert, by way of
motion, as a defense, or otherwise, in any such suit, action
or proceeding, (i) any claim that it is not personally
subject to the jurisdiction of the above-named New York
State or Federal courts, (ii) that the suit, action or
proceeding is brought in an inconvenient forum, that the
venue of the suit, action or proceeding is improper, or
(iii) that this Guarantee or the subject matter hereof may
not be enforced in or by such courts or under any applicable
law. The Guarantor hereby consents to service of process in
any suit, action or other proceeding arising out of this
Guarantee or the subject matter hereof or any of the
transactions contemplated hereby and hereby appoints the
Person set forth in Schedule 7 of the Loan Agreement as
Process Agent for the Borrower (the "Process Agent") as its
attorneys-in-fact to receive service of process in such
action, suit or proceeding, it being agreed that service
upon the Process Agent shall constitute valid service upon
the Guarantor and its successors and assigns. The Guarantor
agrees that (x) the sole responsibilities of the Process
Agent shall be (i) to receive such process, (ii) to send a
copy of any such process so received to the Guarantor, by
registered airmail, return receipt requested, at its address
set forth in Section 5.2 hereof, or at the last address
filed in writing by it with the Process Agent and (iii) to
give prompt telegraphic notice of receipt thereof to the
Guarantor at such address and (y) the Process Agent shall
have no responsibility for the receipt or nonreceipt by the
Guarantor of such process, nor for any performance or
nonperformance by it or its respective successors or
assigns. The Guarantor hereby agrees to pay to the Process
Agent such compensation as shall be agreed upon from time to
time by it and the Process Agent for the Process Agent's
services hereunder. The Guarantor hereby agrees that its
submission to jurisdiction and its designation of the
Process Agent set forth above is made for the express
benefit of the Obligee and its successors, subrogees and
assigns. The Guarantor agrees that it will at all times
continuously maintain a Process Agent to receive service of
process in the City of New York or San Francisco, California
on behalf of itself and its properties with respect to this
Agreement, and in the event that, for any reason, the
Process Agent named pursuant to this Section 5.6 shall no
longer serve as Process Agent to receive service of process
on the Guarantor's behalf, the Guarantor shall promptly
appoint a successor Process Agent. The Guarantor further
agrees that a final judgment against the Guarantor in any
such action or proceeding shall be conclusive, and may be
enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law, a certified or true
copy of which final judgment shall be conclusive evidence of
the fact and of the amount of any indebtedness or liability
of the Guarantor therein described; provided that nothing in
this Section 5.6 shall affect the right of the Guarantor or
the Obligee or their respective successors, subrogees or
assigns to serve legal process in any other manner permitted
by law or affect the right of the Guarantor or the Obligee
or their respective successors, subrogees or assigns to
bring any action or proceeding against the Guarantor or the
Obligee, as the case may be, or its property in the courts
of other jurisdictions. In the event of the transfer of all
or substantially all the assets and business of the Process
Agent to any other corporation, by consolidation, merger,
sale of assets or otherwise, such other corporation shall be
substituted hereunder for the Process Agent with the same
effect as if named herein in place of the Process Agent. THE
XXXXXXXXX XXXXXX XXXXXX TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING TO WHICH IT IS A PARTY INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT
OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS GUARANTEE, THE CHARTER, OR THE
RELATIONSHIP ESTABLISHED HEREUNDER AND WHETHER ARISING OR
ASSERTED BEFORE OR AFTER THE DATE HEREOF OR BEFORE OR AFTER
THE PAYMENT, OBSERVANCE AND PERFORMANCE IN FULL OF THE
GUARANTOR'S OBLIGATIONS UNDER THIS GUARANTEE.
5.7 Currency of Account. (a) The Dollar is the
currency of account or each and every sum due from the
Guarantor to the Obligee under this Guarantee in respect of
any of the obligations guaranteed hereunder.
(b) If after the occurrence of any Event of
Default, any sum is due from the Guarantor under this
Guarantee or if 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
Guarantor;
(ii) obtaining an order or judgment in any court
or tribunal; or
(iii) enforcing any order or judgment given or
made in relation hereto.
(c) The Guarantor shall indemnify and hold harmless the
Obligee from and against any damages or losses 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 the Obligee may in the
ordinary course of business purchase the first currency with
the second currency in the Frankfurt foreign exchange market
upon receipt of a sum paid to it in satisfaction, in whole
or in part, of any such order, judgment, claim or proof. The
above indemnity shall constitute a separate and independent
obligation of the Guarantor from its other obligations and
shall apply irrespective of any indulgence granted by the
Obligee.
5.8 If any term of this Guarantee and any other
application thereof shall be invalid or unenforceable, the
remainder of this Guarantee and any other application of
such terms shall not be affected thereby.
5.9 This Guarantee shall be binding upon, inure to
the benefit of, and be enforceable by, the Guarantor and the
Obligee and their respective successors and assigns.
5.10 The Guarantor hereby acknowledges and
consents to the assignment of this Guarantee pursuant to the
terms of the
Charter Assignment dated the date hereof between the Obligee
and [KfW] [the Syndicate].
IN WITNESS WHEREOF, the Guarantor has caused this
Guarantee to be duly executed as of the date first set forth
herein.
AMERICAN PRESIDENT COMPANIES, LTD.
By:_________________________________
Title:
SCHEDULE 1
page 1 of 2
NAMES AND ADDRESSES OF SYNDICATE MEMBERS
Commerzbank AG (Kiel Branch)
Xxxxxxxxxxxxxx 00
X-00000 Xxxx
Xxxxxxx Xxxxxxxx xx Xxxxxxx
Attention: Xx. Xxxxx
Telex: 292898 CBKD
Telecopy: 49-431-9974-372
Dresdner Bank AG in Xxxxxxx
Xxxxxxxxxxxxx 00
X-00000 Xxxxxxx
Xxxxxxx Xxxxxxxx xx Xxxxxxx
Attention: Xx. Xxxxxx
Xx. Xxxxxxxx
Telex: 2157170 DR D
Telecopy: 00-00-0000-0000
Vereins- und Westbank AG
Alter Wall 22
D-20457 Hamburg
Federal Republic of Germany
Attention: Xx. Xxxxxx
Xxx. Xxxxxxx
Telex: 215164 VH D
Telecopy: 00-00-0000-0000
Deutsche Schiffsbank AG
Domshof 17
D-28195 Bremen
Federal Republic of Germany
Attention: Xx. Xxxxxx
Xx. Xxxxx
Telex: 244870 DSBR D
Telecopy: 00-000-000000
Norddeutsche Landesbank -Girozentrale
Xxxxxxxxxxx 0
X-00000 Xxxxxxxx
Xxxxxxx Xxxxxxxx xx Xxxxxxx
Attention: Xx. Xxxxxxxx
Telex: 921634 GZH D
Telecopy: 49 511 36 14785
Schedule 1
Page 2 of 2
Deutsche verkehrs-Bank AG
(Hamburg Branch)
Filiale Hamburg
Ballindamm 6
D-20095 Hamburg
Federal Republic of Germany
Attention: Mr. Xxxxxxx
Telex: 402077 DVB
Telecopy: 49-40-308004-12
Banque Internationale a
Luxembourg S.A.
0 Xxxxxxxxx Xxxxx
X-0000 Xxxxxxxxxx
Attention: Xx. Xxxx Xxxxxx Xxxxxxx
Telex: 3326 BIL LU
Telecopy: 00-0-0000-0000
