EXHIBIT 4(i)
CONFORMED COPY
DATED 20 APRIL 2004
SHIP VENTURES INC.
(AS BORROWER)
COMMERZBANK AKTIENGESELLSCHAFT
HAMBURG BRANCH
HSBC BANK PLC
KFW
DNB NOR BANK ASA
OVERSEA-CHINESE BANKING CORPORATION LIMITED
SINGAPORE BRANCH
(AS ARRANGERS AND UNDERWRITERS)
THE SEVERAL BANKS
PARTICULARS OF WHICH ARE SET OUT IN SCHEDULE 2
(AS LENDERS)
HSBC BANK PLC
(AS AGENT)
COMMERZBANK AKTIENGESELLSCHAFT
(AS HERMES AGENT)
HSBC BANK PLC
(AS TRUSTEE)
--------------------------------------------------
SECURED LOAN AGREEMENT
FOR THE EQUIVALENT AMOUNT IN UNITED STATES DOLLARS
OF UP TO Euro 308,130,000
PRE- AND POST DELIVERY FINANCE
FOR ONE LUXURY CRUISE VESSEL WITH 1,188 PASSENGER CABINS
BEING HULL NO S.668 AT THE YARD OF XXX. X. XXXXX GMBH
----------------------------------------------------
XXXXXXXXXX XXXXXXX
XXX XX XXXX'X XXXXXXXXXX
XXXXXX XX0X 0XX
TEL: x00 (0)00 0000 0000
FAX: + 00 (0)00 0000 0000
REF: 1253/42-02376
CONTENTS
PAGE
1 Definitions and Construction...................................................................... 1
1.1 Definitions............................................................................. 1
1.2 Construction............................................................................ 20
1.3 Agent, Hermes Agent and Trustee......................................................... 21
2 The Facility...................................................................................... 22
2.1 Availability............................................................................ 22
2.2 Purpose and Application................................................................. 22
2.3 Drawdown................................................................................ 23
2.4 Payment of Portions..................................................................... 24
2.5 Currency Option......................................................................... 25
2.6 Break costs on failure to draw.......................................................... 26
2.7 Conditions of drawdown.................................................................. 27
2.8 Several obligations of the Lenders...................................................... 27
2.9 Lender's failure to perform............................................................. 27
2.10 Fulfilment of conditions after drawdown................................................. 27
3 Repayment......................................................................................... 28
4 Prepayment........................................................................................ 28
4.1 Voluntary prepayment.................................................................... 28
4.2 Voluntary prepayment in case of increased cost.......................................... 28
4.3 Mandatory prepayment in case of illegality.............................................. 28
4.4 Voluntary prepayment following imposition of Substitute Basis........................... 29
4.5 Prepayment in case of Total Loss of the Vessel.......................................... 30
4.6 Prepayment in case of sale of the Vessel................................................ 30
4.7 Effect of prepayment.................................................................... 31
4.8 Break costs on prepayment............................................................... 31
5 Interest.......................................................................................... 31
5.1 Payment of interest prior to the Termination Date....................................... 31
5.2 Payment of interest from the Termination Date........................................... 32
5.3 Selection and duration of Pre-Delivery Interest Periods and Interest Periods............ 32
5.4 Conversion.............................................................................. 34
5.5 Fixed Rate.............................................................................. 34
5.6 Break costs in relation to Conversion................................................... 34
5.7 No notice and unavailability............................................................ 35
5.8 Separate Interest Periods for Instalments............................................... 36
5.9 Extension and shortening of Pre-Delivery Interest Periods or Interest Periods........... 36
5.10 Applicable Interest Rate................................................................ 36
5.11 Bank basis.............................................................................. 37
5.12 Default interest........................................................................ 37
6 Substitute Basis of Funding....................................................................... 38
6.1 Market disturbance...................................................................... 38
6.2 Suspension of drawdown.................................................................. 39
6.3 Certificates of Substitute Basis........................................................ 39
6.4 Review.................................................................................. 40
7 Payments.......................................................................................... 40
7.1 Place for payment....................................................................... 40
7.2 Deductions and grossing-up.............................................................. 40
7.3 Production of receipts for Taxes........................................................ 42
7.4 Money of account........................................................................ 43
7.5 Accounts................................................................................ 44
7.6 Earnings................................................................................ 44
7.7 Continuing security..................................................................... 44
8 Yield Protection and Force Majeure................................................................ 45
8.1 Increased costs......................................................................... 45
8.2 Force majeure........................................................................... 46
9 Representations and Warranties.................................................................... 47
9.1 Duration................................................................................ 47
9.2 Representations and warranties.......................................................... 47
9.3 Representations on the First Drawdown Date.............................................. 55
9.4 Representations on the Delivery Date.................................................... 56
10 Undertakings...................................................................................... 56
10.1 Duration................................................................................ 56
10.2 Information............................................................................. 57
10.3 Notification of default................................................................. 58
10.4 Consents and registrations.............................................................. 58
10.5 Negative pledge......................................................................... 58
10.6 Disposals............................................................................... 58
10.7 Change of business...................................................................... 59
10.8 Mergers................................................................................. 60
10.9 Maintenance of status and franchises.................................................... 61
10.10 Financial records....................................................................... 61
10.11 Financial indebtedness and subordination of indebtedness................................ 61
10.12 Pooling of earnings and charters........................................................ 62
10.13 Loans and guarantees by the Borrower.................................................... 63
10.14 Supervision and Management.............................................................. 63
10.15 Acquisition of shares................................................................... 63
10.16 Trading with the United States of America............................................... 63
10.17 Further assurance....................................................................... 64
10.18 Valuation of the Vessel................................................................. 64
10.19 Marginal security....................................................................... 65
10.20 Performance of employment contracts..................................................... 66
10.21 Insurances.............................................................................. 67
10.22 Operation and maintenance of the Vessel................................................. 73
10.23 Hermes Cover............................................................................ 80
10.24 Dividends............................................................................... 80
11 Default........................................................................................... 80
11.1 Events of default....................................................................... 80
11.2 Acceleration............................................................................ 87
11.3 Default indemnity....................................................................... 88
11.4 Set-off................................................................................. 89
12 Application of Funds.............................................................................. 89
12.1 Total Loss proceeds/proceeds of sale/Event of Default monies............................ 89
12.2 General funds........................................................................... 91
12.3 Application of proceeds of Insurances................................................... 92
12.4 Application of any reduction in the Hermes Premium...................................... 93
12.5 Suspense account........................................................................ 93
13 Fees.............................................................................................. 93
14 Expenses.......................................................................................... 93
14.1 Initial expenses........................................................................ 93
14.2 Enforcement expenses.................................................................... 93
14.3 Stamp duties............................................................................ 94
15 Waivers, Remedies Cumulative...................................................................... 94
15.1 No waiver............................................................................... 94
15.2 Remedies cumulative..................................................................... 94
15.3 Severability............................................................................ 94
15.4 Time of essence......................................................................... 95
16 Counterparts...................................................................................... 95
17 Assignment........................................................................................ 95
17.1 Benefit of agreement.................................................................... 95
17.2 No transfer by the Borrower............................................................. 95
17.3 Assignments, participations and transfers by a Lender................................... 95
17.4 Effectiveness of transfer............................................................... 96
17.5 Transfer of rights and obligations...................................................... 96
17.6 Consent and increased obligations of the Borrower....................................... 97
17.7 Disclosure of information............................................................... 97
17.8 Transfer Certificate to be executed by the Agent........................................ 98
17.9 Notice of Transfer Certificates......................................................... 99
17.10 Documentation of transfer or assignment................................................. 99
17.11 Contracts (Rights of Third Parties) Xxx 0000 (the "Act")................................ 99
18 Notices........................................................................................... 99
18.1 Mode of communication................................................................... 99
18.2 Address................................................................................. 100
18.3 Telefax communication................................................................... 100
18.4 Receipt................................................................................. 101
18.5 Language................................................................................ 101
19 Governing Law..................................................................................... 101
20 Waiver of Immunity................................................................................ 101
21 Rights of the Agent and the Lenders............................................................... 102
21.1 No derogation of rights................................................................. 102
21.2 Enforcement of remedies................................................................. 102
22 Jurisdiction...................................................................................... 102
Schedule 1 Particulars of Arrangers................................................................ 108
Schedule 2 Particulars of Agent, Hermes Agent, Trustee and Lenders................................. 110
Schedule 3 Notice of Drawdown...................................................................... 113
Schedule 4 Conditions Precedent.................................................................... 116
Schedule 5 Confidentiality Undertaking............................................................. 124
Schedule 6 Transfer Certificate.................................................................... 126
Schedule 7 Form of Notice of Fixed Rate............................................................ 133
Schedule 8 Chartering of the Six Vessels (as defined in Clause 10.6.4)............................. 134
THIS LOAN AGREEMENT is made the 20th day of April 2004
BETWEEN:
(1) SHIP VENTURES INC. of Corporation Trust Center, 0000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Xxxxxx Xxxxxx of America as borrower (the
"Borrower");
(2) THE SEVERAL BANKS particulars of which are set out in Schedule 1 as
arrangers and underwriters (collectively the "Arrangers" and each
individually an "Arranger");
(3) THE SEVERAL BANKS particulars of which are set out in Schedule 2 as
lenders (collectively the "Lenders" and each individually a "Lender");
(4) HSBC BANK PLC of 0 Xxxxxx Xxxxxx, Xxxxxx X00 0XX as agent (the
"Agent");
(5) COMMERZBANK AKTIENGESELLSCHAFT of Xxxxxxxxxxx, 00000 Xxxxxxxxx xx Xxxx,
Xxxxxxx Xxxxxxxx of Germany as agent (the "Hermes Agent"); and
(6) HSBC BANK PLC of 0 Xxxxxx Xxxxxx, Xxxxxx X00 0XX as trustee (the
"Trustee").
WHEREAS:
The Arrangers have agreed on the terms and subject to the conditions set out in
this Agreement to arrange and underwrite a loan in the Equivalent Amount of up
to three hundred and eight million one hundred and thirty thousand Euro
(EURO 308,130,000), subject to Clause 2.5, to be made by the Lenders to the
Borrower to part-finance (among other things) the construction by the Builder of
the Vessel for the Contract Price.
NOW IT IS HEREBY AGREED as follows:
1 DEFINITIONS AND CONSTRUCTION
1.1 DEFINITIONS
In this Agreement:
"Account Charge" means the charge over the Operating Account,
to be given by the Borrower in favour of the Trustee (together
with the notice and acknowledgement thereof), such charge,
notice and acknowledgement to be in substantially the form and
on the terms and conditions required by the Agent and
the Hermes Agent and agreed on the signing hereof and as
specified in paragraph 51 of Schedule 4;
"AGENCY AND TRUST DEED" means the deed dated the date hereof
entered into by the Lenders, the Agent, the Hermes Agent and
the Trustee whereby the Agent and the Hermes Agent will be
appointed as agents of the Lenders and the Trustee will be
appointed as trustees for the Agent, the Hermes Agent and the
Lenders;
"AGREEMENT" means this agreement;
"APPLICABLE INTEREST RATE" means, until (but excluding) the
Conversion Date, the applicable Floating Interest Rate and,
thereafter, the Fixed Rate subject to Clause 5.12 and Clause
6;
"ARRASAS" means Arrasas Limited of Xxxxxxxxxxxxx Xxxxx, Xxxxxx
Xxxx, Xxxxxxxx Road, Douglas, Isle of Man IM2 4RB, British
Isles;
"ASSOCIATED COMPANY" in relation to any company, means any
company which is a Subsidiary or Holding Company of that
company or the majority of whose shares are beneficially owned
by the same person or persons as own the majority of the
shares of that company;
"BUILDER" means Xxx. X. Xxxxx GmbH of Xxxxxxxxxxxxxxx Xxx,
00000 Xxxxxxxxx, Xxxxxxx Xxxxxxxx of Germany, the shipbuilder
constructing the Vessel pursuant to the Building Contract;
"BUILDING CONTRACT" means the shipbuilding contract dated as
of 15 September 2003 as amended by a first addendum thereto
dated 13 April 2004 between the Builder, the Borrower and
Arrasas for the construction and delivery of the Vessel and
Specification No P.8573 - Hull No S.668 dated 22 August 2003
and the appendices thereto marked A, B and C;
"BUILDING CONTRACT ASSIGNMENT" means the valid and effective
first legal assignment of the benefit of the Building Contract
to be executed by the Borrower and Arrasas in favour of the
Trustee (together with the notice and acknowledgement
thereof), such assignment, notice and acknowledgement being in
the form and on the terms and conditions required by the Agent
and agreed on the signing hereof and as specified in paragraph
29 of Schedule 4;
2
"BUSINESS DAY" means any day on which, in a country where any
act or thing is required to be done hereunder or under the
Building Contract, in the case of any payment to be made to
the Builder thereunder, banks and financial markets and, if
applicable, TARGET are open for the transaction of business of
the nature contemplated by this Agreement;
"CERTIFIED COPY" means, in relation to any document delivered
or issued by or on behalf of any company, a copy of such
document certified as a true, complete and up-to-date copy of
the original by any of the directors or the secretary or
assistant secretary for the time being of that company;
"CHARGE" means the charge over the Shares to be given by the
Shareholder as holder (legally and beneficially) of the Shares
to the Trustee pursuant to the Charge Option;
"CHARGE OPTION" means the option to take the Charge to be
given by the Shareholder to the Trustee on the date hereof,
such option and the Charge being in the form and on the terms
and conditions required by the Agent and the Hermes Agent and
as specified in paragraph 15 of Schedule 4;
"COMMITMENT PERIOD" means the period beginning on the date
hereof and ending on the date on which the Facility is drawn
down in full or cancelled hereunder;
"COMMITMENT" means, as to each Lender, the sum set out
opposite its name in Schedule 2 as the amount which, subject
to the terms of this Agreement, it is obliged to advance to
the Borrower under Clause 2 (or, where the context so admits,
such amount which any successor in title, assignee or
transferee (including any Transferee) of any Lender shall be
obliged to advance to the Borrower under Clause 2, following
the assumption of all or any portion of such liability from
any Lender hereunder) in each case as such amount may be
reduced, cancelled or terminated under this Agreement;
"COMPULSORY ACQUISITION" means requisition for title or other
compulsory acquisition of the Vessel including its capture,
seizure, detention or confiscation or expropriation but
excluding any requisition for hire by or on behalf of any
government or governmental authority or agency or by any
persons acting or
3
purporting to act on behalf of any such government or
governmental authority or agency;
"CONFIDENTIALITY UNDERTAKING" means the undertaking to be
entered into relating to the release of financial information
pertaining to the Group by the Agent, the Trustee or any
Lender to a potential Transferee or assignee such undertaking
to be in the form of Schedule 5;
"CONSTRUCTION PERIOD" means the period beginning on the date
hereof and ending on the Delivery Date;
"CONSTRUCTION RISKS INSURANCE ASSIGNMENT" means the valid and
effective first priority assignment of the Insurances
(together with the notices thereof), to be executed by the
Builder and the Borrower in respect of the Vessel in favour of
the Trustee, such assignment and notices being in the form and
on the terms and conditions required by the Agent and the
Hermes Agent and agreed on the signing hereof and as specified
in paragraph 30 of Schedule 4;
"CONTRACT PRICE" means three hundred and fifty nine million
eight hundred and fifty thousand Euro (EURO 359,850,000)
being the price agreed between the Builder and the Borrower
for the construction of the Vessel under article 8, clause 1.1
of the Building Contract;
"CONTRIBUTION" means as to each Lender the sum set out
opposite its name in Schedule 2 as the amount which it is
obliged to advance to the Borrower under Clause 2 or, as the
case may be, the portion of such sum so advanced and for the
time being outstanding;
"CONVERSION" means the conversion of the method of calculating
interest from the Floating Interest Rate to the Fixed Rate;
"CONVERSION DATE" has the meaning ascribed to that term in
Clause 5.3.2;
"CURRENCY CONVERSION DATE" means a date on which the Euro Loan
at that date is converted to Dollars being a Pre-Delivery
Interest Payment Date or an Interest Payment Date;
"DELIVERY DATE" means the date on which the Vessel is
delivered to and accepted by the Borrower pursuant to the
Building Contract;
4
"DISCLOSURE LETTER" means the letter so designated given by
the Borrower and acknowledged by the Agent (acting on the
instructions of the Lenders) on the date of this Agreement;
"DOCUMENT OF COMPLIANCE" means a document issued to the Vessel
operator as evidence of its compliance with the requirements
of the ISM Code;
"DOLLARS" AND "USD" means the lawful currency of the United
States of America;
"DOLLAR LOAN" means the aggregate amount of the Portions or
any part thereof denominated in Dollars or (as the context may
require) the amount thereof for the time being drawn down
and/or denominated in Dollars and outstanding hereunder;
"DRAWDOWN DATE" means a date being a Business Day on which a
part of a Portion is drawn down pursuant to Clause 2.3;
"DRAWDOWN NOTICE" means any of the notices to be given by the
Borrower to the Agent pursuant to Clause 2.3.1;
"EARNINGS" means, in respect of the Vessel, (whether earned or
to be earned) any and all freights, hire and passage monies,
proceeds of requisition (other than proceeds of Compulsory
Acquisition), rebates and commissions, all earnings deriving
from contracts of affreightment, pooling agreements, joint
ventures, compensation, remuneration for salvage and towage
services, damages howsoever arising and detention monies,
damages for breach of any charterparty or other contract for
the employment of the Vessel, any amounts payable in
consideration of the termination or variation of any
charterparty or other such contract, any sums payable or
repayable by the Builder under the Building Contract, any
reduction in the Hermes Premium repaid by Hermes to the
Borrower and any other earnings whatsoever due or to become
due to the Borrower;
"EARNINGS ASSIGNMENT" means the valid and effective first
legal assignment of the Earnings (together with the notice
thereof and the acknowledgement), to be executed by the
Borrower in respect of the Vessel in favour of the Trustee,
such assignment, notice and acknowledgement being in the form
and on the terms and
5
conditions required by the Agent and the Hermes Agent and
agreed on the signing hereof and as specified in paragraph 28
of Schedule 4;
"ELECTION DATE" has the meaning ascribed to that term in
Clause 5.3.2;
"ENCUMBRANCE" means any mortgage, charge, pledge, lien,
assignment, hypothecation, title retention, preferential right
or trust arrangement or any other security agreement or
arrangement;
"EQUIVALENT AMOUNT" means the Dollar equivalent of (i) each
amount payable in Euro by the Borrower to the Builder under
the Building Contract or payable to the Borrower in
reimbursement of the Hermes Premium and to be drawn down
hereunder in Dollars or (ii) the Euro Loan on a Currency
Conversion Date, in each case determined at HSBC Bank plc's
spot rate for conversion of Dollars to Euro at 10.00 a.m.
London time two (2) Business Days prior to the relevant
Drawdown Date or the relevant Currency Conversion Date (as the
case may be);
"EURIBOR" means with respect to any Pre-Delivery Interest
Period or Interest Period and with respect to the Euro Loan
the rate of interest (expressed as an annual rate) determined
by the Agent to be:
(i) the offered rate for deposits in Euro for a period
equivalent to such Pre-Delivery Interest Period or
Interest Period which appears on the page of the
Reuters screen which displays the average EURIBOR
rate as agreed with EURIBOR FBE for deposits in Euro
of the relevant amount at or about 11.00 a.m. London
time on the Quotation Date; or
(ii) if no rate is provided for the respective
Pre-Delivery Interest Period or Interest Period on
the said Reuters screen, the interpolated rate per
annum for deposits in Euro in an amount approximately
equal to the Euro Loan as calculated by the Agent,
such interpolated rate to be based on the said
Reuters screen PROVIDED THAT EURIBOR for periods of
less than one (1) week will be ascertained under
sub-section (iii) below;
or (if the said Reuters screen is discontinued or if the Agent
is unable to make the said determination due to technical
breakdown in the relevant system or the Pre-Delivery Interest
Period or Interest Period is less than one (1) week)
6
(iii) the arithmetic mean (rounded upwards, if necessary,
to the nearest one-sixteenth of one per cent (1/16%))
of the rates per annum notified to the Agent by each
of the Reference Banks as the rate at which deposits
in Euro in an amount approximately equal to the Euro
Loan are offered to such Reference Bank by leading
banks in the London Interbank market at such
Reference Bank's request at or about 11.00 a.m.
London time on the Quotation Date for a period equal
to the Pre-Delivery Interest Period or Interest
Period and for delivery on the first Business Day
thereof;
"EURIBOR FBE" means the Banking Federation of the European
Union;
"EURO" AND "(EURO)" means the lawful currency of the Federal
Republic of Germany;
"EURO LOAN" means the aggregate amount of the Portions or any
part thereof denominated in Euro or (as the context may
require) the amount thereof for the time being drawn down and
outstanding hereunder;
"EVENT OF DEFAULT" means any of the events specified in Clause
11;
"FACILITY" means the loan facility granted hereunder being in
the Equivalent Amount (in aggregate) of up to three hundred
and eight million one hundred and thirty thousand Euro
(E308,130,000), subject to Clause 2.5;
"FINANCIAL INDEBTEDNESS" means any obligation for the payment
or repayment of money, whether as principal or as surety and
whether present or future, actual or contingent;
"FIRST DRAWDOWN DATE" means the date on which Tranche 1 and,
if applicable, Tranche A is drawn down and applied in
accordance with Clause 2.2.1 and Clause 2.2.2;
"FIXED RATE" means the fixed rate of interest agreed jointly
by the Borrower and each of the Lenders at or about 11.00 a.m.
London time on the Quotation Date prior to the Conversion Date
payable, subject to Clause 5.8, on each Interest Payment Date
during the Fixed Rate Period;
"FIXED RATE PERIOD" means the period starting on (and
including) the Conversion Date and ending on the final
Repayment Date;
7
"FLOATING INTEREST RATE" means for each Pre-Delivery Period
and Interest Period selected pursuant to Clause 5.3.1 the
aggregate of LIBOR or EURIBOR (as the case may be) and the
Margin;
"FORCE MAJEURE" means, in relation to the Agent, the Hermes
Agent, the Trustee or any Lender, any event or circumstance
which is beyond the reasonable control of such party, which
cannot be foreseen or if foreseeable which is unavoidable,
which occurs after the date of this Agreement and which
prevents that party from performing any of its obligations
under this Agreement;
"GAAP" means generally accepted accounting principles in the
United States of America consistently applied (or, if not
consistently applied, accompanied by details of the
inconsistencies) including, without limitation, those set
forth in the opinion and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board;
"GROUP" means Star and its Subsidiaries;
"GUARANTEE" means the guarantee to be executed by the
Guarantor in favour of the Trustee on the date hereof, such
guarantee being in the form and on the terms and conditions
required by the Agent and the Hermes Agent and as specified in
paragraph 14 of Schedule 4;
"GUARANTOR" means NCL Corporation Ltd. of Xxxx Xxxx, 0 Xxxx
Xxxxxx, Xxxxxxxx XX 00, Xxxxxxx and with its principal place
of business at 0000 Xxxxxxxxx Xxxxxx Xxxxx, Xxxxx, Xxxxxxx
00000, Xxxxxx Xxxxxx of America;
"HERMES" means Euler Hermes Kreditversicherungs-AG of
Xxxxxxxxxxxxx 000, 00000 Xxxxxxx, Xxxxxxx Xxxxxxxx of Germany;
"HERMES COVER" means the guarantee from the Federal Republic
of Germany acting through Hermes for the period of the
transaction in the amount and on the terms and conditions
required by the Lenders;
"HERMES INSURANCE PREMIUM" means the amount payable in Euro by
the Borrower to Hermes through the Hermes Agent in respect of
the Hermes Cover;
8
"HERMES ISSUING FEES" means the amount payable in Euro by the
Borrower to Hermes through the Hermes Agent by way of handling
fees in respect of the Hermes Cover;
"HERMES PREMIUM" means the aggregate of the Hermes Issuing
Fees and the Hermes Insurance Premium;
"HOLDING COMPANY" has the meaning defined in the Companies Xxx
0000, Section 736 as substituted by the Companies Xxx 0000,
Section 144;
"IOL" means Inter-Ocean Limited of Xxxxxxxxxxxxx Xxxxx, Xxxxxx
Xxxx, Xxxxxxxx Road, Xxxxxxx, Isle of Man IM2 4RB, British
Isles;
"ISM CODE" means the International Management Code for the
Safe Operation of Ships and for Pollution Prevention adopted
by the International Maritime Organisation;
"ISPS CODE" means the International Ship and Port Facility
Security Code adopted by the International Maritime
Organisation;
"INDEBTEDNESS FOR BORROWED MONEY" means Financial Indebtedness
(whether present or future, actual or contingent, long-term or
short-term, secured or unsecured) in respect of:
(i) moneys borrowed or raised;
(ii) the advance or extension of credit (including
interest and other charges on or in respect of any of
the foregoing);
(iii) the amount of any liability in respect of leases
which, in accordance with GAAP, are capital leases;
(iv) the amount of any liability in respect of the
purchase price for assets or services payment of
which is deferred for a period in excess of one
hundred and eighty (180) days;
(v) all reimbursement obligations whether contingent or
not in respect of amounts paid under a letter of
credit or similar instrument;
9
(vi) all interest rate and currency swap and similar
agreements obliging the making of payments, whether
periodically or upon the happening of a contingency
(and the value of such Financial Indebtedness shall
be the xxxx-to-market valuation of such transaction
at the relevant time); and
(vii) (without double counting) any guarantee of Financial
Indebtedness falling within paragraphs (i) to (vi)
above;
"INSTALMENT" means the amount of principal of the Loan
repayable on a Repayment Date in accordance with Clause 3;
"INSURANCE ASSIGNMENT" means the valid and effective first
legal assignment of the Insurances (together with the notice
thereof), to be executed by the Borrower in respect of the
Vessel in favour of the Trustee, such assignment and notice to
be in the form and on the terms and conditions required by the
Agent and the Hermes Agent and agreed on the signing hereof
and as specified in paragraph 44 of Schedule 4;
"INSURANCES" means all policies and contracts of insurance
(including construction risks insurance under the Building
Contract) and entries of the Vessel in a protection and
indemnity or war risks association which are effected in
respect of the Vessel, its freights, disbursements, profits or
otherwise and all benefits, including all claims and returns
of premiums thereunder and shall also include all compensation
payable by virtue of Compulsory Acquisition;
"INTEREST EXCHANGE ARRANGEMENT" means such interest rate
arrangements as a Lender shall deem necessary to make in
respect of its Contribution in order to offer the Fixed Rate
to the Borrower;
"INTEREST PAYMENT DATE" means the last day of each Interest
Period and each Repayment Date occurring during an Interest
Period or the Fixed Rate Period;
"INTEREST PERIOD" means each period ascertained in accordance
with Clause 5.3 or Clause 5.12 other than a Pre-Delivery
Interest Period;
"INTEREST RATE" means the rate(s) of interest applicable to
the Loan calculated in accordance with Clause 5.10, Clause
5.12 or Clause 6.3;
10
"LIBOR" means with respect to any Pre-Delivery Interest Period
or Interest Period and with respect to the Dollar Loan the
rate of interest (expressed as an annual rate) determined by
the Agent to be:
(i) the offered rate for deposits in Dollars for a period
equivalent to such Pre-Delivery Interest Period or
Interest Period which appears on the Reuters Page
LIBO at or about 11.00 a.m. London time on the
Quotation Date; or
(ii) if no rate is provided for the respective
Pre-Delivery Interest Period or Interest Period on
the Reuters Page LIBO, the interpolated rate per
annum for deposits in Dollars in an amount
approximately equal to the Dollar Loan as calculated
by the Agent, such interpolated rate to be based on
the Reuters Page LIBO PROVIDED THAT LIBOR for periods
of less than one (1) week will be ascertained under
sub-section (iii) below;
or (if Reuters Page LIBO is discontinued or if the Agent is
unable to make the said determination due to technical
breakdown in the relevant system or the Pre-Delivery Interest
Period or Interest Period is less than one (1) week)
(iii) the arithmetic mean (rounded upwards, if necessary,
to the nearest one-sixteenth of one per cent (1/16%))
of the rates per annum notified to the Agent by each
of the Reference Banks as the rate at which deposits
in Dollars in an amount approximately equal to the
Dollar Loan are offered to such Reference Bank by
leading banks in the London Interbank market at such
Reference Bank's request at or about 11.00 a.m.
London time on the Quotation Date for a period equal
to the Pre-Delivery Interest Period or Interest
Period and for delivery on the first Business Day
thereof;
"LOAN" means the aggregate principal amount of the Dollar Loan
and the Euro Loan or (as the context may require) the amount
thereof for the time being drawn down and outstanding
hereunder;
"MANAGEMENT AGREEMENT" means the agreement to be entered into
between the Borrower and the Manager providing for the ship
management and crewing services of the Vessel, such agreement
to be in the form and on the terms and conditions required by
the Agent and agreed on the signing hereof and as specified in
paragraph 47 of Schedule 4;
11
"MANAGEMENT AGREEMENT ASSIGNMENT" means the valid and
effective first legal assignment of the Management Agreement
(together with the notice thereof and the acknowledgement), to
be executed by the Borrower in favour of the Trustee, such
assignment, notice and acknowledgement to be in the form and
on the terms and conditions required by the Agent and the
Hermes Agent and agreed on the signing hereof and as specified
in paragraph 49 of Schedule 4;
"MANAGER" means NCL America Inc. of Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Xxxxxx Xxxxxx
of America, the company providing ship management and crewing
services for the Vessel pursuant to the Management Agreement;
"MARGIN" means the rate of nought point seven five per cent
(0.75%) per annum;
"MONTH" means a period starting on one day in a calendar month
and ending on the numerically corresponding day in the next
calendar month save that, where any such period would
otherwise end on a day which is not a Business Day, it shall
end on the next Business Day, unless that day falls in the
calendar month succeeding that in which it would otherwise
have ended, in which case it shall end on the preceding
Business Day PROVIDED THAT, if a period starts on the last
Business Day in a calendar month or if there is no numerically
corresponding day in the month in which that period ends, that
period shall end on the last Business Day in that later month;
"MORTGAGE" means either of the Pre-Delivery Mortgage or the
Post Delivery Mortgage;
"NCLC FLEET" means the vessels owned by companies in the NCLC
Group;
"NCLC GROUP" means the Guarantor and its Subsidiaries;
"NCL INTERNATIONAL" means NCL International, Ltd. of Xxxx
Xxxx, 0 Xxxx Xxxxxx, Xxxxxxxx XX 00, Xxxxxxx;
"NCLL" means Norwegian Cruise Line Limited of Xxxx Xxxx, 0
Xxxx Xxxxxx, Xxxxxxxx XX 00, Xxxxxxx;
"NOTICE OF FIXED RATE" means a notice in the form of Schedule
7;
12
"OBLIGORS" means the Borrower, the Guarantor, the Manager, the
Sub-Agent, the Shareholder, the Supervisor, Arrasas and any
other party from time to time to any of the Security Documents
excluding the Builder, Hermes, the Arrangers, the Trustee, the
Agent, the Hermes Agent and the Lenders;
"OFFICE" means in respect of the Agent, the Hermes Agent, the
Trustee and each Lender its office at the address set out
beneath its name in Schedule 2 or such other office as it
shall from time to time select and notify through the Agent to
the Borrower;
"OPERATING ACCOUNT" means the account opened or to be opened
by the Borrower with such bank or banks as may be approved by
the Agent and the Hermes Agent from time to time for receipt
of the Earnings;
"OUTSTANDING INDEBTEDNESS" means all sums of any kind payable
actually or contingently to the Trustee, the Agent, the Hermes
Agent or the Lenders under or pursuant to this Agreement or
any Transaction Document (whether by way of repayment of
principal payment of interest or default interest payment of
any indemnity or counter indemnity reimbursement for fees,
costs or expenses or otherwise howsoever);
"PERMITTED LIENS" means (i) any Encumbrance created by or
pursuant to the Security Documents (ii) liens on the Vessel up
to an aggregate amount at any time not exceeding five million
Dollars (USD5,000,000) for current crew's wages and salvage
and liens incurred in the ordinary course of trading the
Vessel and (iii) any other Encumbrance notified by any of the
Obligors to the Agent prior to the date hereof;
"PORTION" means any of Portion 1, Portion 2 or Portion 3;
"PORTION 1" means the aggregate principal amount of the
Portion 1 Tranches or (as the context may require) the amount
thereof for the time being drawn down and outstanding
hereunder in whatever currency or currencies it is for the
time being denominated;
"PORTION 1 TRANCHE" means Tranche 1, Tranche 2, Tranche 3
and/or Tranche 4 of Portion 1;
13
"PORTION 2" means the Equivalent Amount of the aggregate
principal amount of the Portion 2 Tranches, subject to Clause
2.5, or (as the context may require) the amount thereof for
the time being drawn down and outstanding hereunder in
whatever currency or currencies it is for the time being
denominated;
"PORTION 2 TRANCHE" means Tranche A, Tranche B and/or Tranche
C of Portion 2;
"PORTION 3" means up to eighty per cent (80%) of the
Pre-Delivery Interest or (as the context may require) the
amount thereof for the time being drawn down and outstanding
hereunder in whatever currency or currencies it is for the
time being denominated;
"POSSIBLE EVENT OF DEFAULT" means any event which, with the
giving of notice, passage of time or occurrence of any other
event, would constitute an Event of Default;
"POST DELIVERY MORTGAGE" means the first preferred ship
mortgage to be granted by the Borrower over the Vessel and
registered at the US Coast Guard National Vessel Documentation
Center in favour of the Trustee as security pursuant hereto,
such mortgage to be in the form and on the terms and
conditions required by the Agent and the Hermes Agent and
agreed on the signing hereof and as specified in paragraph 42
of Schedule 4;
"PRE-DELIVERY INTEREST PAYMENT DATE" means the last day of
each Pre-Delivery Interest Period;
"PRE-DELIVERY INTEREST PERIOD" means each period ascertained
in accordance with Clause 5.3 or Clause 5.12 other than an
Interest Period;
"PRE-DELIVERY INTEREST" means the aggregate of the interest
payable on the Loan on each Pre-Delivery Interest Payment
Date;
"PRE-DELIVERY MORTGAGE" means the first priority abstract
acknowledgement of debt and mortgage ("Abstraktes
Schuldversprechen und Schiffshypothekenbestellungsurkunde")
and part submission ("Unterwerfung unter die sofortige
Zwangsvollstreckung"), to be granted by the Borrower over the
Vessel in favour of the Trustee as security pursuant hereto
during the
14
Construction Period, such abstract, mortgage and submission
being in the form and on the terms and conditions required by
the Agent and the Hermes Agent and agreed on the signing
hereof and as specified in paragraph 27 of Schedule 4;
"PROCESS AGENT" means Xxxxxxxx Chance Secretaries Limited
whose registered office is presently at 00 Xxxxx Xxxx Xxxxxx,
Xxxxxx X00 0XX or any other person in England nominated by the
Borrower, any other Obligor or the Builder and approved by the
Agent as agent to accept service of legal proceedings on their
behalf under any of this Agreement and the other Security
Documents;
"QUOTATION DATE" means, in relation to any Pre-Delivery
Interest Period or Interest Period, the day on which
quotations would ordinarily be given in the relevant interbank
eurocurrency market for Dollar or Euro (as the case may be)
deposits for delivery on the first day of that Pre-Delivery
Interest Period or Interest Period PROVIDED THAT if such
quotation date is not a Business Day the quotation date shall
be the preceding Business Day;
"REFERENCE BANKS" means Commerzbank Aktiengesellschaft and
HSBC Bank plc;
"REPAYMENT DATES" means the last day of each of the twenty
four (24) consecutive periods of six (6) months the first such
period commencing on the Termination Date and the twenty
fourth such period terminating twelve (12) years thereafter;
"REUTERS PAGE LIBO" means the display currently designated as
Reuters Page LIBO, which includes London Interbank Offered
Rates of four (4) major banks, which are members of the
International Swaps and Derivatives Association, Inc. or such
other service as may be nominated by the British Bankers'
Association as the information vendor for displaying the
London Interbank Offered Rates of major banks in the London
Interbank market;
"SAFETY MANAGEMENT CERTIFICATE" means a document issued to the
Vessel as evidence that the Vessel's operator and its
shipboard management operate in accordance with an approved
Safety Management System;
15
"SAFETY MANAGEMENT SYSTEM" means a structured and documented
system enabling the personnel of the Vessel's operator to
implement effectively the safety and environmental protection
policy of that Vessel operator;
"SAME DAY FUNDS" means Dollar funds settled through the New
York Clearing House Interbank Payments System or Euro funds
settled through TARGET or such other funds for payment in
Dollars or Euro (as the case may be) as the Agent shall
specify by notice to the Borrower as being customary at the
time for the settlement of international transactions in New
York or Frankfurt am Main (as the case may be) of the type
contemplated by this Agreement;
"SECURITY DOCUMENTS" means this Agreement, the Guarantee, the
Hermes Cover, the Building Contract Assignment, the
Construction Risks Insurance Assignment, the Supervision
Agreement Assignment, the Management Agreement Assignment, the
Sub-Agency Agreement Assignment, the Mortgages, the Charge
Option, the Charge, the Earnings Assignment, the Insurance
Assignment, the Account Charge and all such other documents as
may be executed at any time in favour of (among others) the
Trustee, the Hermes Agent and/or any of the Lenders as
security for the obligations of the Borrower, the other
Obligors and the Builder whether executed pursuant to the
express provisions of this Agreement or otherwise howsoever;
"SECURITY PERIOD" means the period beginning on the First
Drawdown Date and ending on the date on which the amounts
outstanding under this Agreement and under each of the other
Security Documents are finally paid or repaid in full;
"SHAREHOLDER" means NCL America Holdings, Inc. of Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000,
Xxxxxx Xxxxxx of America;
"SHARES" means the three thousand (3,000) authorised shares of
common stock in the Borrower legally and beneficially owned by
the Shareholder;
"STAR" means Star Cruises Limited of Canon's Court, 00
Xxxxxxxx Xxxxxx, Xxxxxxxx XX 00, Xxxxxxx;
"SUB-AGENCY AGREEMENT" means the agreement to be entered into
between the Manager and the Sub-Agent providing for the
commercial, marketing, sales and financial services in respect
of the Vessel, such agreement to be in the form and
16
on the terms and conditions required by the Agent and agreed
on the signing hereof and as specified in paragraph 48 of
Schedule 4;
"SUB-AGENCY AGREEMENT ASSIGNMENT" means the valid and
effective first legal assignment of the Sub-Agency Agreement
(together with the notice thereof and the acknowledgement), to
be executed by the Manager in favour of the Trustee, such
assignment, notice and acknowledgement to be in the form and
on the terms and conditions required by the Agent and the
Hermes Agent and agreed on the signing hereof and as specified
in paragraph 50 of Schedule 4;
"SUB-AGENT" means NCL (Bahamas) Ltd. of Xxxx Xxxx, 0 Xxxx
Xxxxxx, Xxxxxxxx XX 11, Bermuda, the company providing
commercial, marketing, sales and financial services in respect
of the Vessel pursuant to the Sub-Agency Agreement;
"SUBSIDIARY" has the meaning defined in the Companies Xxx
0000, Section 736 as substituted by the Companies Xxx 0000,
Section 144;
"SUBSTITUTE BASIS" means an alternative basis for maintaining
the Loan certified by the Agent pursuant to Clause 6.3.1;
"SUPERVISION AGREEMENT" means the agreement entered or to be
entered into between the Borrower and the Supervisor providing
for the construction supervision of the Vessel, such agreement
being in the form and on the terms and conditions required by
the Agent and agreed on the signing hereof and as specified in
paragraph 12 of Schedule 4;
"SUPERVISION AGREEMENT ASSIGNMENT" means the valid and
effective first legal assignment of the Supervision Agreement
(together with the notice thereof and the acknowledgement), to
be executed by the Borrower in favour of the Trustee, such
assignment, notice and acknowledgement being in the form and
on the terms and conditions required by the Agent and the
Hermes Agent and agreed on the signing hereof and as specified
in paragraph 31 of Schedule 4;
"SUPERVISOR" means Star Cruise Management Limited of
Xxxxxxxxxxxxx Xxxxx, Xxxxxx Xxxx, Xxxxxxxx Road, Xxxxxxx, Isle
of Man IM2 4RB, British Isles, the company providing
construction supervision for the Vessel pursuant to the
Supervision Agreement;
17
"SUSPENSION NOTICE" means a notice given by the Agent to the
Borrower pursuant to Clause 6.1;
"TARGET" means trans-European automated real-time gross
settlement express transfer system;
"TAXES" means all present and future income and other taxes,
levies, imposts, deductions, compulsory liens and withholdings
whatsoever together with interest thereon and penalties with
respect thereto, if any, and any payments made on or in
respect thereof and "TAXATION" shall be construed accordingly;
"TERMINATION DATE" means the earlier of the Delivery Date and
10 October 2006 (or such later date as is agreed between the
Borrower, the Lenders and Hermes);
"TOTAL LOSS" means any actual or constructive or arranged or
agreed or compromised total loss or Compulsory Acquisition of
the Vessel;
"TRANCHE" means either a Portion 1 Tranche or a Portion 2
Tranche;
"TRANCHE A" means the amount of the Hermes Premium less
seventy five per cent (75%) of the Hermes Insurance Premium
and twenty per cent (20%) of the Hermes Premium or the
Equivalent Amount thereof of to be paid to the Borrower in
part reimbursement of the aggregate amount of the Hermes
Issuing Fees and twenty five per cent (25%) of the Hermes
Insurance Premium paid by the Borrower to the Hermes Agent for
on-payment to Hermes on the issue of the Hermes Cover to be
advanced by the Lenders by way of their Contributions thereto
on the first Drawdown Date in respect of a Portion 1 Tranche
falling after the payment by the Borrower of the Hermes
Issuing Fees and the first twenty five per cent (25%) of the
Hermes Insurance Premium;
"TRANCHE B" means up to seventy five per cent (75%) of the
amount of the Hermes Insurance Premium or the Equivalent
Amount thereof payable on the later of the First Drawdown Date
and the issue of the Hermes Cover to be paid to the Hermes
Agent for on-payment to Hermes to be advanced by the Lenders
on a Drawdown Date by way of their Contributions thereto
PROVIDED THAT the amount of this Tranche and the amount of
Tranche A shall not when aggregated exceed eighty per cent
(80%) of the Hermes Premium;
18
"TRANCHE C" means up to the amount by which the Hermes
Insurance Premium is increased after the date on which the
seventy five per cent (75%) of the amount of the Hermes
Insurance Premium is paid by the Hermes Agent to Hermes or the
Equivalent Amount thereof to be paid to the Hermes Agent for
on-payment to Hermes to be advanced by the Lenders on a
Drawdown Date by way of their Contributions thereto PROVIDED
THAT the amount of this Tranche and the amount of Tranche A
and Tranche B shall not when aggregated exceed eighty per cent
(80%) of the Hermes Premium;
"TRANCHE 1" means the amount of [***] [Confidential Treatment]
or the Equivalent Amount thereof to be applied in payment of
the balance of the third pre-delivery instalment due by the
Borrower to the Builder under the Building Contract to be
advanced by the Lenders on a Drawdown Date by way of their
Contributions thereto;
"TRANCHE 2" means the amount of [***] [Confidential Treatment]
or the Equivalent Amount thereof to be applied in payment of
the fourth pre-delivery instalment due by the Borrower to the
Builder under the Building Contract to be advanced by the
Lenders on a Drawdown Date by way of their Contributions
thereto;
"TRANCHE 3" means the amount of [***] [Confidential Treatment]
or the Equivalent Amount thereof to be applied in payment of
the fifth pre-delivery instalment due by the Borrower to the
Builder under the Building Contract to be advanced by the
Lenders on a Drawdown Date by way of their Contributions
thereto;
"TRANCHE 4" means the amount of up to [***] [Confidential
Treatment] or the Equivalent Amount thereof to be applied in
payment of the delivery instalment due by the Borrower to the
Builder under the Building Contract to be advanced by the
Lenders on the Delivery Date by way of their Contributions
thereto PROVIDED THAT the Euro amount of this Tranche and the
Euro amounts of the other Tranches shall not when aggregated
exceed [***] [Confidential Treatment] of the Contract Price;
19
"TRANSACTION DOCUMENTS" means the Security Documents, the
Building Contract, the Drawdown Notices, the Supervision
Agreement, the Management Agreement, the Sub-Agency Agreement,
the Agency and Trust Deed and any other material document now
or hereafter issued in connection with the documents or the
transaction herein referred to and also including any Interest
Exchange Arrangement;
"TRANSFER CERTIFICATE" means the certificate attached hereto
as Schedule 6;
"TRANSFER DATE" means, in relation to any Transfer
Certificate, the date specified in such Transfer Certificate
as the date for the making of the transfer or, where such
transfer is specified as being subject to the fulfilment of
certain conditions, the date on which the Agent receives a
certificate from the Lender making the transfer confirming
that all such conditions have been fulfilled;
"TRANSFEREE" means any reputable bank acceptable to the Agent
and the Borrower which becomes a party to this Agreement as a
Lender pursuant to Clause 17; and
"VESSEL" means hull no S.668 at the yard of the Builder
registered in the name of the Borrower in the Shipbuilding
Register in Emden, Federal Republic of Germany and upon
construction as a luxury cruise vessel with one thousand one
hundred and eighty eight (1,188) passenger cabins to be
delivered to the Borrower pursuant to the Building Contract
and re-registered in the name of the Borrower under the laws
and flag of the United States of America.
1.2 CONSTRUCTION
In this Agreement unless the context otherwise requires:
1.2.1 clause headings are inserted for convenience of
reference only and shall be ignored in the
construction of this Agreement;
1.2.2 references to Clauses and to Schedules are to be
construed as references to clauses of and schedules
to this Agreement unless otherwise stated and
references to this Agreement are to be construed as
references to this Agreement including its Schedules;
20
1.2.3 references to (or to any specified provision of) this
Agreement or any other document shall be construed as
references to this Agreement, that provision or that
document as from time to time amended, supplemented
and/or novated;
1.2.4 references to any Act or any statutory instrument
shall be construed as references to that Act or that
statutory instrument as from time to time re-enacted,
amended or supplemented;
1.2.5 references to any party to this Agreement or any
other document shall include reference to such
party's successors and permitted assigns;
1.2.6 references to the Builder shall be disregarded when
it has performed in full all its obligations under
the Building Contract and the Security Documents to
which it is a party;
1.2.7 words importing the plural shall include the singular
and vice versa;
1.2.8 references to a person shall be construed as
references to an individual, firm, company,
corporation, unincorporated body of persons or any
state or any agency thereof;
1.2.9 where any matter requires the approval or consent of
the Agent or the Trustee such approval or consent
shall not be deemed to have been given unless given
in writing; where any matter is required to be
acceptable to the Agent or the Trustee, the Agent or
the Trustee (as the case may be) shall not be deemed
to have accepted such matter unless its acceptance is
communicated in writing; the Agent or the Trustee may
give or withhold its consent, approval or acceptance
at its unfettered discretion;
1.2.10 a certificate by the Agent as to any amount due or
calculation made hereunder shall be conclusive except
for manifest error.
1.3 AGENT, HERMES AGENT AND TRUSTEE
The Agent and the Hermes Agent will be appointed by the
Lenders as agents and the Trustee will be appointed by the
Lenders as trustee under the Agency and Trust Deed and
references herein to the Agent, the Hermes Agent or the
Trustee shall be construed as references to itself, the Agent
or the Hermes Agent (if
21
applicable) and the Lenders. The Borrower shall only
communicate with the Lenders under this Agreement and the
other Security Documents through the Agent, the Hermes Agent
or the Trustee (as the case may be) and as hereinafter
referred to.
2 THE FACILITY
2.1 AVAILABILITY
2.1.1 The Lenders grant to the Borrower the Facility by way
of the Portions. Any part of the Facility which
remains undrawn at close of business in London on the
Termination Date shall be capable of cancellation by
the Lenders with the consent of Hermes.
2.1.2 Each Lender shall advance its Contribution to the
Portions in the proportion which its Contribution for
the time being bears to the other Contributions of
the Lenders.
2.1.3 Neither the Agent (as the Agent or as a Lender) nor
any other Lender shall be liable for any failure or
delay on the part of any Lender in making any advance
hereunder nor shall the Agent or the Arrangers have
any obligation to seek to procure additional Lenders
in the event of such a failure PROVIDED THAT if any
Lender should fail to advance its Contribution
hereunder, that Lender and the Agent will take all
reasonable steps to mitigate the effect of that
failure. Notwithstanding the aforesaid proviso,
neither the Agent (as a Lender) nor any other Lender
shall be obliged to increase its Contribution
hereunder in respect of the failure by any other
Lender(s) to fund its Contribution.
2.2 PURPOSE AND APPLICATION
The purpose of the Facility is set out below.
2.2.1 Portion 1 shall finance up to eighty per cent (80%)
of the Contract Price. Tranche 1 shall be applied in
payment of part of the third pre-delivery instalment
due by the Borrower to the Builder under the Building
Contract, Tranche 2 in payment of the fourth
pre-delivery instalment due to the Builder under the
Building Contract, Tranche 3 in payment of the
22
fifth pre-delivery instalment due to the Builder
under the Building Contract and Tranche 4 in payment
of the delivery instalment due to the Builder under
the Building Contract;
2.2.2 Portion 2 shall reimburse the Borrower for or finance
up to eighty per cent (80%) of the Hermes Premium.
Tranche A shall reimburse the Borrower in part for
the amount of the Hermes Premium paid to the Hermes
Agent for on-payment to Hermes on issue of the Hermes
Cover, Tranche B shall be applied in payment or (if
insufficient) in part payment of seventy five per
cent (75%) of the Hermes Insurance Premium payable on
the later of the First Drawdown Date and the issue of
the Hermes Cover and Tranche C shall be applied in
payment or (if insufficient) in part payment of any
increase in the Hermes Insurance Premium thereafter;
and
2.2.3 Portion 3 shall finance up to eighty per cent (80%)
of the total amount of the Pre-Delivery Interest
payable hereunder and shall be drawn down in the
currency or currencies in which the Loan is for the
time being denominated and the proportion of the
interest payable in any currency shall correspond to
the proportion of the Loan denominated in that
currency.
2.3 DRAWDOWN
The Borrower shall only make drawings under any Portion of the
Facility if:
2.3.1 in the case of Portion 1 and Portion 2, the Agent
receives at least five (5) Business Days' notice of
the Borrower's request for such drawing in the form
of Schedule 3;
2.3.2 no Event of Default or Possible Event of Default has
occurred before the date of such drawing;
2.3.3 no written notice has been received indicating that
the Hermes Cover does not validly exist without
restriction;
2.3.4 the representations and warranties set out in Clause
9 and each of the other Security Documents are
correct on the date of such drawing; and
23
2.3.5 it is then lawful for each of the Lenders to make
available its Contribution to the Facility,
PROVIDED THAT no part of the Loan shall be capable of drawing
until twenty per cent (20%) of the Contract Price has been
paid by the Borrower to the Builder and no part of Portion 2
shall be capable of drawing until the Hermes Issuing Fees and
twenty five per cent (25%) of the Hermes Insurance Premium
have become due and been paid by the Borrower to Hermes
through the Hermes Agent and PROVIDED FURTHER THAT the
aggregate of (a) the Euro amount of the Portion 2 Tranches
drawn down hereunder in Euro (b) the equivalent amount in Euro
determined at the rate of exchange for Euro against Dollars as
determined at HSBC Bank plc's spot rate at about 10.00 a.m.
two (2) Business Days prior to the Termination Date of the
Portion 2 Tranches drawn down hereunder in Dollars (c) the
Euro amount of the aggregate of each amount of Portion 3 drawn
down hereunder in Euro and (d) the equivalent amount in Euro
determined at the rate of exchange for Euro against Dollars as
determined at HSBC Bank plc's spot rate at about 10.00 a.m.
two (2) Business Days prior to the Termination Date of the
aggregate of each amount of Portion 3 drawn down hereunder in
Dollars, shall not exceed in total twenty million two hundred
and fifty thousand Euro ((EURO)20,250,000).
2.4 PAYMENT OF PORTIONS
All Portion 1 Tranches drawn down hereunder shall be paid to
the Builder.
Tranche A drawn down hereunder shall be paid to the Borrower
in reimbursement in part of the amount of the Hermes Premium
paid by the Borrower to the Hermes Agent for on-payment to
Hermes on issue of the Hermes Cover, Tranche B drawn down
hereunder shall be applied in payment or (if insufficient) in
part payment of seventy five per cent (75%) of the Hermes
Insurance Premium payable on the later of the First Drawdown
Date and the issue of the Hermes Cover and Tranche C drawn
down hereunder shall be applied in payment or (if
insufficient) in part payment of any increase in the Hermes
Insurance Premium thereafter, subject to the further proviso
to Clause 2.3.
Subject to the further proviso to Clause 2.3, the Borrower
hereby consents to the drawdown on each Pre-Delivery Interest
Payment Date of such amount of
24
Portion 3 as is required to pay eighty per cent (80%) of the
Pre-Delivery Interest payable on that Pre-Delivery Interest
Payment Date and to the application of such amount in payment
of such interest.
2.5 CURRENCY OPTION
2.5.1 The Borrower may by notice in writing served on the
Agent not less than five (5) Business Days prior to a
Drawdown Date request that a Portion be advanced in
Euro or in Dollars.
2.5.2 If the Borrower fails to make a request in accordance
with Clause 2.5.1 or if deposits in Euro in the
relevant amount and for the relevant duration are not
available to any of the Lenders in the relevant
interbank eurocurrency market in the ordinary course
of business to fund its Contribution then with effect
from the relevant Drawdown Date the Portion or any
part thereof shall be advanced in Dollars.
2.5.3 The Borrower may by notice in writing served on the
Agent not less than five (5) Business Days prior to a
Currency Conversion Date request that the Euro Loan
shall be converted to Dollars on the next Currency
Conversion Date for the duration of the Security
Period.
2.5.4 On a Currency Conversion Date the Euro Loan at that
date shall be repaid by the Borrower in Euro.
However, the Lenders shall on that day readvance that
part of the Euro Loan (due allowance being made for
any amounts repaid or prepaid since the first day of
the preceding Pre-Delivery Interest Period or
Interest Period) on terms that:
(a) the proceeds of that readvance shall
forthwith be applied by the Lenders in or
towards effecting the said repayment on
behalf of the Borrower so that:
(i) the obligation of the Borrower to
make that repayment shall be a
notional obligation only except to
the extent that the proceeds of
that readvance are insufficient to
make that repayment in full; and
25
(ii) the obligation of the Lenders to
make that readvance shall be a
notional obligation only except to
the extent that the proceeds of
that readvance exceed the amount of
that repayment; and
(b) the Lenders shall forthwith readvance the
Equivalent Amount of the Euro Loan at that
date.
2.5.5 All losses, damages, expenses, profits or currency
risks arising from the exercise of the currency
option contained in this Clause 2.5 shall be for the
account of the Borrower.
2.5.6 The conversion of the Euro Loan into Dollars or the
operation of this Clause 2.5 shall not constitute or
be construed as a prepayment pursuant to the
provisions of Clause 4.
2.5.7 Notwithstanding the drawdown of any part of the Loan
in Euro or its subsequent conversion into Dollars it
is expressly acknowledged and agreed by the parties
hereto that the Security Documents shall remain in
full force and effect and that they shall stand as
security for the Loan in whatever currency or
currencies it is for the time being denominated.
2.6 BREAK COSTS ON FAILURE TO DRAW
If for any reason any part of a Portion is not drawn down by
the Borrower hereunder after notice of drawdown has been given
to the Agent pursuant to Clause 2.3 in the case of Portion 1
and Portion 2 or after the relevant Quotation Date in the case
of Portion 3, the Borrower will pay to the Agent for the
account of the Lenders such amount as the Agent may certify as
necessary to compensate the Lenders (other than any Lender
whose default has caused the part of the Portion not to be
drawn down) for any loss (including the cost of breaking
deposits or re-employing funds (including warehousing and
other related costs)) or any losses under any Interest
Exchange Arrangement and/or any swap agreements or other
interest rate management products entered into by the Lenders
for the purpose of this transaction or expense (including
warehousing and other related costs) on account of funds
borrowed, contracted for (whether in Euro or in Dollars) or
utilised in order to fund its Contribution to the part of the
26
Portion. Each Lender shall supply to the Agent a certificate
of break costs which in the absence of manifest error shall be
conclusive as to the amounts due.
2.7 CONDITIONS OF DRAWDOWN
The Agent shall not be under any obligation to advance a part
of a Portion hereunder until all the documents and evidence
referred to in the relevant part of Schedule 4 are in the
possession of the Agent in form and substance satisfactory to
it, the Arrangers, the Lenders and the Hermes Agent.
2.8 SEVERAL OBLIGATIONS OF THE LENDERS
The obligations and rights of each Lender hereunder are
several and if for any reason the Borrower receives in respect
of a part of a Portion an amount greater than the aggregate of
the Contributions to that part of a Portion, the Borrower
forthwith upon the demand of the Agent shall pay to the Agent
(for the account of those Lenders whose Contributions were
exceeded) the amount certified by the Agent as representing
the excess of the amount paid to the Borrower over the due and
proper amount of the Contributions of the Lenders actually
received by the Agent.
2.9 LENDER'S FAILURE TO PERFORM
Subject to Clause 2.1.3, the failure by a Lender to perform
its obligations hereunder shall not affect the obligations of
the Borrower towards any other party hereto nor shall any such
other party be liable for the failure by such Lender to
perform its obligations hereunder.
2.10 FULFILMENT OF CONDITIONS AFTER DRAWDOWN
If the Lenders, acting unanimously, decide (or the Agent in
accordance with the Agency and Trust Deed decides) to advance
a part of a Portion to the Borrower hereunder without having
received all of the documents or evidence referred to in the
relevant part of Schedule 4, the Borrower will nevertheless
deliver the remaining documents or evidence to the Agent
within fourteen (14) days of such drawing (or such other
period as the Agent may stipulate) and the advance of the
Facility shall not be construed as a waiver of the Agent's
right to receive the documents or evidence as aforesaid nor
shall this provision impose on the Agent
27
or the Lenders any obligation to permit the drawing in the
absence of such documents or evidence.
3 REPAYMENT
3.1 Unless otherwise repaid in accordance with the provisions of
this Agreement, the Borrower hereby agrees to repay the Loan
by twenty four (24) equal half yearly Instalments of principal
in the currency or currencies in which the Loan is for the
time being denominated and the proportion of each Instalment
payable in any currency shall correspond to the proportion of
the Loan denominated in that currency. The first such
Instalment shall be paid six (6) months from the Termination
Date and the remainder at six (6) monthly intervals.
4 PREPAYMENT
4.1 VOLUNTARY PREPAYMENT
On giving at least thirty (30) days' prior notice to the
Agent, the Borrower may on the last day of a Pre-Delivery
Interest Period or an Interest Period prepay (without premium
or penalty, subject to Clause 4.8) the whole or any relevant
part of the Loan (but if in part in an amount of five million
Dollars (USD5,000,000) or the equivalent amount in Euro (as
the case may be) or an integral multiple thereof). In the case
of a prepayment of part of the Loan, the proportion of that
part payable in Dollars or Euro (as the case may be) shall
correspond to the proportion of the Loan denominated in that
currency at the prepayment date.
4.2 VOLUNTARY PREPAYMENT IN CASE OF INCREASED COST
At any time after any sum payable by the Borrower has been
increased under Clause 8 or a Lender has made any claim for
indemnification under Clause 8, the Borrower may, after giving
to the Agent five (5) Business Days' notice of its intention
to do so, prepay the whole (but not part only) of the
Contribution of that Lender, subject to Clause 4.8, in
whatever currency or currencies it is for the time being
denominated.
4.3 MANDATORY PREPAYMENT IN CASE OF ILLEGALITY
4.3.1 If any change in, or in the interpretation or
application of, any law, regulation or treaty shall
make it unlawful in any jurisdiction applicable to
28
any of the Lenders for that Lender to make available
or maintain its Contribution or to give effect to its
obligations as contemplated hereby, the Agent may, by
notice thereof to the Borrower, declare that the
relevant Lender's obligations shall be terminated
forthwith whereupon (if any of the Facility has then
been advanced) the Borrower shall prepay forthwith to
the relevant Lender its Contribution in whatever
currency or currencies it is for the time being
denominated together with interest thereon to the
date of such prepayment and all other amounts due to
such Lender under Clause 4.8 and under the Security
Documents (or, if permitted by the relevant law,
regulation or treaty, at the end of the then current
Pre-Delivery Interest Period or Interest Period).
4.3.2 A Lender affected by any provision of Clause 4.3.1
shall promptly inform the Agent after becoming aware
of the relevant change and the Agent shall, as soon
as reasonably practicable thereafter, notify the
Borrower of the change and its possible results.
Without affecting the Borrower's obligations under
Clause 4.3.1 and in consultation with the Agent, the
affected Lender will then take all such reasonable
steps as may be open to it to mitigate the effect of
the change (for example (and if then possible) by
changing its Office or transferring some or all of
its rights and obligations under this Agreement to
another financial institution reasonably acceptable
to the Borrower and the Agent). The reasonable costs
of mitigating the effect of any such change shall be
borne by the Borrower save where such costs are of an
internal administrative nature and are not incurred
in dealings by any Lender with third parties.
4.4 VOLUNTARY PREPAYMENT FOLLOWING IMPOSITION OF SUBSTITUTE BASIS
The Borrower may notify the Agent within ten (10) days of the
receipt of a certificate from the Agent of a Substitute Basis
under Clause 6.3 whether or not it wishes to prepay the Loan,
in which event the Borrower shall forthwith prepay the Loan in
whatever currency or currencies it is for the time being
denominated together with interest accrued thereon at the rate
specified in the relevant certificate of Substitute Basis and
any break costs in accordance with Clause 4.8.
29
4.5 PREPAYMENT IN CASE OF TOTAL LOSS OF THE VESSEL
If the Vessel is or becomes a Total Loss, then the Borrower
will, within thirty (30) days thereof or, if the Agent is
satisfied in its sole discretion that the Total Loss is
adequately covered by the Insurances and that the relevant
insurance proceeds will be payable to the Agent within one
hundred and fifty (150) days plus three (3) business days in
Frankfurt, New York and Singapore thereof, by no later than
the date which is one hundred and fifty (150) days plus three
(3) business days in Frankfurt, New York and Singapore after
the date of the event giving rise to such Total Loss prepay
the Loan in accordance with Clause 4.7, Clause 4.8 and Clause
12.1.
For the purposes of this Clause a Total Loss shall be deemed
to have occurred:
4.5.1 if it consists of an actual loss, at noon Greenwich
Mean Time on the actual date of loss or, if that is
not known, on the date on which the Vessel was last
heard of;
4.5.2 if it consists of a Compulsory Acquisition, at noon
Greenwich Mean Time on the date on which the
requisition is expressed to take effect by the person
requisitioning the Vessel; and
4.5.3 if it consists of a constructive or compromised or
arranged or agreed total loss or damage to the Vessel
rendering repair impracticable or uneconomical or
rendering the Vessel permanently unfit for normal
use, at noon Greenwich Mean Time on the date on which
notice claiming the loss of the Vessel is given to
its insurers.
4.6 PREPAYMENT IN CASE OF SALE OF THE VESSEL
If the Vessel is sold by the Borrower with the prior consent
of the Agent (which consent is not to be unreasonably withheld
or delayed), then the Borrower will concurrent with completion
of the sale prepay the Loan in accordance with Clause 4.7 and
Clause 12.1. Subject to Clause 4.8 hereof, prepayment of the
Loan consequent upon the permitted sale of the Vessel shall
absolve the Borrower from any liability to pay prepayment fees
or costs.
30
4.7 EFFECT OF PREPAYMENT
Any notice given by the Borrower under Clause 4.1, Clause 4.2
or Clause 4.4 shall be irrevocable and shall oblige the
Borrower to pay to the Agent on account of the Lenders the
amount or amounts therein stated on the date therein stated.
No amount prepaid under this Agreement may be redrawn. Each
prepayment under this Agreement shall be applied in
satisfaction of the Borrower's remaining obligations under
Clause 3 in inverse chronological order. Prepayments under
this Agreement shall be made together with accrued interest
thereon and the payment of all other sums then owing under any
of the Security Documents.
4.8 BREAK COSTS ON PREPAYMENT
If any repayment or prepayment of the Loan or part thereof is
made otherwise than on the last day of a Pre-Delivery Interest
Period or an Interest Period or, following Conversion, any
repayment or prepayment of the Loan or part thereof is made
otherwise than on the last day of the Fixed Rate Period, the
Borrower shall pay to the Agent on behalf of the Lenders on
demand such additional amount as the Agent may certify (such
certificate to contain a calculation thereof in reasonable
detail) as necessary to compensate each of the Lenders for any
loss (including the cost of breaking deposits or re-employing
funds (including warehousing and other related costs)) or any
losses under any Interest Exchange Arrangement and/or any swap
agreements or other interest rate management products entered
into by the Lenders for the purpose of this transaction or
expense (including warehousing and other related costs) on
account of funds borrowed, contracted for or utilised to fund
the amount so repaid or prepaid provided that each Lender
shall pay to the Borrower any swap breakage gain actually
received by the Lender under any Interest Exchange Arrangement
to which it is a party and/or any swap agreements or other
interest rate management products entered into by the Lender
for the purpose of this transaction.
5 INTEREST
5.1 PAYMENT OF INTEREST PRIOR TO THE TERMINATION DATE
From the first Drawdown Date in respect of a Portion until the
Termination Date, the Borrower shall pay interest on that
Portion in Dollars and/or Euro (as the case
31
may be) at the Floating Interest Rate applicable for each
Pre-Delivery Interest Period in respect thereof which interest
shall be payable in arrears on each Pre-Delivery Interest
Payment Date from the application of the amount of Portion 3
drawn down on that Pre-Delivery Interest Payment Date (if any)
and by the Borrower.
For the avoidance of doubt, Portion 3 or any part thereof may
only be drawn down hereunder and applied in payment of
interest accrued up to the Termination Date.
5.2 PAYMENT OF INTEREST FROM THE TERMINATION DATE
From the Termination Date, the Borrower shall pay interest on
the Loan at the Applicable Interest Rate for each Interest
Period in respect thereof which interest shall be payable in
arrears on each Interest Payment Date PROVIDED THAT if the
current Interest Period does not end on the relevant Interest
Payment Date the Borrower shall only pay the interest accrued
during that Interest Period up to but not including the
Interest Payment Date.
5.3 SELECTION AND DURATION OF PRE-DELIVERY INTEREST PERIODS AND
INTEREST PERIODS
5.3.1 Subject to the other provisions of this Clause 5, the
Borrower may give notice to the Agent to be received
by the Agent not later than 9.00 a.m. London time
five (5) Business Days prior to the commencement of
each Pre-Delivery Interest Period in respect of a
Portion or part thereof or Interest Period in respect
of the Loan, specifying whether that interest period
is to be of three (3) or six (6) months' duration.
Pre-Delivery Interest Periods shall commence, in the
case of the first in respect of the first part of
Portion 1 and Portion 2 to be drawn down, on the
First Drawdown Date, in the case of the first in
respect of the first part of Portion 3 to be drawn
down on the first Pre-Delivery Interest Payment Date
and, in the case of Pre-Delivery Interest Periods
other than the first in respect of any Portion or
part thereof, on the expiry of the preceding
Pre-Delivery Interest Period. Interest Periods in
respect of the Loan shall commence, in the case of
the first, on the Termination Date and, in the case
of Interest Periods other than the first, on the
expiry of the preceding Interest Period.
32
However, the Agent shall have the right to adjust the
length of any Pre-Delivery Interest Period for a part
of a Portion (other than the first part to be drawn
down) such that it ends on the same date as any
existing Pre-Delivery Interest Period in respect of
that Portion and the first Pre-Delivery Interest
Period in respect of a Portion such that it ends on
the same date as the current Pre-Delivery Interest
Period of the other Portions.
The final Pre-Delivery Interest Period in respect of
a Portion, the Portions or any part thereof (as the
case may be) shall end on the Termination Date and
the final Interest Period shall end on the final
Repayment Date.
5.3.2 Subject to the consent of Hermes and of each of the
Lenders which consents have not, at the date hereof,
been obtained, and provided that any such consents
obtained remain in full force and effect on the date
of the Election Notice (as hereinafter defined), the
Borrower may, if no Event of Default has occurred and
is continuing and no Total Loss has occurred, at any
time prior to the Termination Date, elect to convert
the basis upon which interest is calculated hereunder
by giving notice (an "ELECTION NOTICE") to the Agent
not less than fifteen (15) Business Days (or such
shorter time as the parties may agree) before the
date on which the Interest Exchange Arrangements are
to be entered into (the "ELECTION DATE") to request
that with effect from the Termination Date (the
"CONVERSION DATE") the rate of interest applicable to
the Loan then outstanding shall be the Fixed Rate.
5.3.3 The Borrower shall forthwith provide a copy of the
Election Notice to the Guarantor, who shall upon
receipt provide a written confirmation to both the
Borrower and the Agent that the Guarantee remains in
full force and effect, PROVIDED ALWAYS that no
Interest Exchange Arrangement will be entered into by
a Lender unless a confirmation satisfactory to the
Agent, the Lenders and Hermes is received from the
Guarantor.
5.3.4 Any such request under Clause 5.3.2 shall be
irrevocable, provided that any informal request made
by the Borrower to the Agent for an indication of the
rates which might be available should the Borrower
deliver an Election Notice shall not be construed as
the giving of an Election Notice
33
by the Borrower pursuant to Clause 5.3.2. The parties
hereto agree that not more than two (2) informal
requests may be made.
5.3.5 On receipt of an Election Notice from the Borrower
pursuant to Clause 5.3.2, the Agent shall promptly
notify the Lenders of such election and of the
applicable Election Date and Conversion Date.
5.4 CONVERSION
Conversion shall only occur if:
5.4.1 the Euro Loan has been repaid and readvanced in
accordance with Clause 2.5.4;
5.4.2 the Agent has received an Election Notice;
5.4.3 the Agent has received the confirmation from the
Guarantor referred to in Clause 5.3.3;
5.4.4 the Agent has received evidence of the Interest
Exchange Arrangements executed by the parties
thereto; and
5.4.5 the Fixed Rate for the Loan has been determined.
In the absence of satisfaction of any of the above or any
other relevant provision of Clause 5.3, interest on the Loan
shall continue to be calculated at the Floating Interest Rate.
5.5 FIXED RATE
The Lenders, the Agent and the Borrower agree that as soon as
the Fixed Rate shall have been determined, the Agent shall
inform the Borrower by issuing to the Borrower a Notice of
Fixed Rate. Upon such issuance the Borrower's obligation will
be to pay interest on the Loan at the Fixed Rate from the
Conversion Date and, until such date, at the Floating Interest
Rate.
5.6 BREAK COSTS IN RELATION TO CONVERSION
If an Election Notice has been given to the Facility Agent
pursuant to Clause 5.3.2 and Conversion does not occur on the
Conversion Date as a result of
34
the relevant provisions of Clause 5.3, Clause 5.4 and/or
Clause 5.5 not being satisfied or waived, other than as a
result of gross negligence or wilful misconduct of the Agent
or any of the Lenders, the Borrower shall pay to the Agent for
the account of the Lenders interest accrued to but excluding
the Conversion Date together with such amount as the Agent may
certify (such certificate to contain a calculation thereof in
reasonable detail) as necessary to compensate each of the
Lenders for any loss (including the cost of breaking deposits
or re-employing funds (including warehousing and other related
costs)) or any losses under any Interest Exchange Arrangement
and/or any swap agreements or other interest rate management
products entered into by the Lenders for the purpose of this
transaction as a consequence of Conversion not being made on
the Conversion Date.
If it is necessary for the Lenders to break deposits or
re-employ funds taken or borrowed to make or maintain such
Lender's Contribution to the Portions in whatever currency or
currencies they are for the time being denominated in order
for Conversion to take place on the Conversion Date, the
Borrower shall pay to the Agent for the account of the Lenders
interest accrued to but excluding the Conversion Date together
with such amount as the Agent may certify to be necessary to
compensate a Lender for any losses incurred as a consequence
of the Pre-Delivery Interest Period(s) in respect of the
Portions being prematurely terminated in order to allow
Conversion to occur on the Conversion Date including, without
limitation, any loss (including the cost of breaking deposits
(including warehousing and other related costs)) or expense
(including warehousing and other related costs) on account of
funds borrowed, contracted for or utilised to fund such
Lender's Contribution to the Loan in whatever currency or
currencies it is for the time being denominated.
5.7 NO NOTICE AND UNAVAILABILITY
If the Borrower fails to select a Pre-Delivery Interest Period
or an Interest Period in accordance with Clause 5.3 or the
Agent certifies that deposits for the period selected by the
Borrower are not available to each of the Lenders in the
ordinary course of business in the relevant interbank
eurocurrency market to fund the relevant Portion or the Loan
(as the case may be), the Borrower shall be deemed
35
to have selected a Pre-Delivery Interest Period or an Interest
Period of six (6) months (or such other period as the Agent
may in its discretion decide).
5.8 SEPARATE INTEREST PERIODS FOR INSTALMENTS
If an Interest Period would otherwise extend beyond any
Repayment Date, the Loan shall be divided into two (2) or more
portions. One (1) or more portions will be of an amount equal
to the amount of the Loan required to be repaid on each
relevant Repayment Date and will have an Interest Period of
such length as will expire on that date and the Interest
Period relating to the remainder of the Loan will be
determined in accordance with Clauses 5.3 and 5.7.
5.9 EXTENSION AND SHORTENING OF PRE-DELIVERY INTEREST PERIODS OR
INTEREST PERIODS
If a Pre-Delivery Interest Period or an Interest Period would
otherwise end on a day which is not a Business Day, the
Pre-Delivery Interest Period or Interest Period shall be
extended until the next following Business Day unless the next
following Business Day falls in the next calendar month or the
Interest Period has been selected pursuant to Clause 5.3.2 in
which case the Interest Period will be shortened to expire on
the preceding Business Day.
If a Pre-Delivery Interest Period or an Interest Period
commences on the last Business Day in a month or if there is
no day in the month in which the Pre-Delivery Interest Period
or Interest Period will end which corresponds numerically to
the day on which it begins, the Pre-Delivery Interest Period
or Interest Period shall end on the last Business Day in that
month.
5.10 APPLICABLE INTEREST RATE
5.10.1 In respect of Pre-Delivery Interest Periods or
Interest Periods pursuant to Clause 5.3.1 and subject
to Clause 5.12 and Clause 6, the rate of interest
applicable to the Loan (or relevant part in the case
of the division of the Loan under Clause 5.8) during
a Pre-Delivery Interest Period or an Interest Period
shall be the Floating Interest Rate.
5.10.2 In respect of Interest Periods pursuant to Clause
5.3.2 and subject to Clause 5.12 and Clause 6, the
rate of interest applicable to the Loan (or
36
relevant part in the case of the division of the Loan
under Clause 5.8) during an Interest Period shall be
the Fixed Rate.
5.11 BANK BASIS
Pre-Delivery Interest, interest, fees payable pursuant to
Clause 13 and any other payments hereunder of an annual nature
shall accrue from day to day and be computed on the basis of a
year of three hundred and sixty (360) days and for the actual
number of days elapsed.
5.12 DEFAULT INTEREST
If the Borrower fails to pay on the due date any sum due under
this Agreement or any of the other Security Documents to which
it may at any time be a party, the Borrower shall, without
affecting any other remedy of the Agent or the Lenders, pay
interest on such sum from the due date to the actual date of
payment (as well after as before judgment). Such interest
shall accrue on a daily basis at the higher of the Applicable
Interest Rate fixed for the latest interest period and the
rate computed by the Agent and certified by the Agent to the
Borrower as being the aggregate of:
5.12.1 the Margin plus one per cent (1%); and
5.12.2 the greater of (a) in the case of the Lenders, the
average (rounded upwards if necessary to the next
integral multiple of one-sixteenth of one per cent
(1/16%)) of the respective rates per annum at which
each of the Lenders is able to acquire in accordance
with its normal practice deposits in Dollars or Euro
(as the case may be) in successive periods of one (1)
month (or for such shorter period as the Agent may in
its absolute discretion select) in the relevant
interbank eurocurrency market in an amount equivalent
to or comparable with its Contribution to such sum,
and, in the case of the Agent, the rate per annum at
which it is able to acquire in accordance with its
normal practice deposits in Dollars or Euro (as the
case may be) in successive periods of one (1) month
(or for such shorter period as the Agent may in its
absolute discretion select) in the relevant interbank
eurocurrency market in an amount equivalent to such
sum, as at approximately 10.00 a.m. London time in
the case of Euro and
37
approximately 11.00 a.m. London time in the case of
Dollars on any relevant day and (b) in the case of
the Lenders, the average (rounded upwards if
necessary to the next integral multiple of
one-sixteenth of one per cent (1/16%)) of the cost to
each of the Lenders of funding its Contribution to
such sum, and, in the case of the Agent, the cost of
funding such sum, such interest to be compounded at
the end of the period selected by the Agent and to be
payable on demand. In the event of LIBOR or EURIBOR
(as the case may be) not being available then the
Agent shall in its discretion use the Substitute
Basis for its calculation as set out in Clause 6.3.
6 SUBSTITUTE BASIS OF FUNDING
6.1 MARKET DISTURBANCE
Notwithstanding anything to the contrary in this Agreement, if
prior to the commencement of any Pre-Delivery Interest Period
or any Interest Period pursuant to Clause 5.3.1 the Agent
shall determine in good faith (which determination shall be
conclusive and binding on the parties hereto) that:
6.1.1 by reason of circumstances affecting the relevant
interbank eurocurrency market adequate and fair means
do not exist for ascertaining the Floating Interest
Rate during such Pre-Delivery Interest Period or
Interest Period pursuant to Clause 5; or
6.1.2 deposits in Dollars or Euro (as the case may be) of
equal duration to such Pre-Delivery Interest Period
or Interest Period will not be available to any of
the Lenders in the relevant interbank eurocurrency
market in sufficient amounts in the ordinary course
of business to fund its Contribution during such
Pre-Delivery Interest Period or Interest Period; or
6.1.3 by reason of any material change in applicable law or
regulation or of any change in national or
international financial or economic conditions any of
the Lenders is unable to fund or to continue to fund
its Contribution during such Pre-Delivery Interest
Period or Interest Period by deposits obtained in the
relevant interbank eurocurrency market,
38
then the Agent shall promptly give a notice (being a
Suspension Notice), containing full particulars
thereof in reasonable detail to the Borrower.
6.2 SUSPENSION OF DRAWDOWN
If a Suspension Notice is given by the Agent before the
advance of any of the Facility in accordance with Clause 2
then the Agent shall not be obliged to advance the Facility
until notice to the contrary is given by the Agent. During the
period of thirty (30) days from the giving of such Suspension
Notice, the Agent and any Lender affected by the relevant
market disturbance shall consult in good faith with the
Borrower with a view to agreeing to an alternative basis for
advancing of the Facility or any relevant part thereof. If
such alternative basis is agreed between the Borrower, the
Agent, the relevant Lender or Lenders and Hermes, it shall
apply in accordance with its terms and, if not, the Facility
or any relevant part thereof shall be made available to the
Borrower in the other of the currencies of Dollars or Euro.
6.3 CERTIFICATES OF SUBSTITUTE BASIS
6.3.1 If the Facility or part thereof has been advanced
before a Suspension Notice is given, the Lender or
Lenders affected by the relevant market disturbance
shall within thirty (30) days following the date of
the Suspension Notice, certify (through the Agent) in
good faith to the Borrower an alternative basis
approved by the Hermes Agent (being the Substitute
Basis) for maintaining its Contribution affected by
the relevant market disturbance. Such Substitute
Basis may be retroactive to the beginning of the then
current Pre-Delivery Interest Period or Interest
Period (or Pre-Delivery Interest Periods or Interest
Periods), and may include an alternative currency or
an alternative method of fixing the Interest Rate
(which shall reflect the cost to the relevant Lender
or Lenders of funding its Contribution from other
sources plus the Margin) or alternative Pre-Delivery
Interest Periods or Interest Periods for the Loan or
any relevant part thereof, PROVIDED ALWAYS THAT so
far as practicable any such Substitute Basis shall be
computed in a manner and for periods as similar as
possible to those provided in Clause 5.
39
6.3.2 Each Substitute Basis so certified shall be binding
upon the Borrower, the Agent and the Lenders and
shall be treated as part of this Agreement.
6.4 REVIEW
So long as any Substitute Basis is in force, the Agent, in
consultation with the Borrower and the Lenders, shall from
time to time, but not less often than monthly, review whether
or not the circumstances referred to in Clause 6.1 still
prevail with a view to returning to the normal provisions of
this Agreement.
7 PAYMENTS
7.1 PLACE FOR PAYMENT
All payments by the Borrower under this Agreement or any of
the other Security Documents to which it may at any time be a
party shall be made in Same Day Funds and:
7.1.1 if in Dollars to HSBC Bank USA, New York (SWIFT Code
XXXXXX00) for the account of HSBC Bank plc, London
(SWIFT Code XXXXXX00), account no 000-023868 in
favour of Project and Export Finance, account no
36677449, quoting reference 53M/FC1031 by 10.00 a.m.
New York time; and
7.1.2 if in Euro to HSBC Bank plc, London (SWIFT Code
XXXXXX00), in favour of Project and Export Finance,
account no 00000000, quoting reference 53M/FC1031 by
10.00 a.m. Frankfurt am Main time.
7.2 DEDUCTIONS AND GROSSING-UP
7.2.1 Each payment to be made by the Borrower to a Lender
or the Agent hereunder in Dollars or in Euro shall be
made free and clear of and without deduction for or
on account of Taxes unless the Borrower is required
by law to make such a payment subject to the
deduction or withholding of Taxes, in which case the
sum payable by the Borrower in respect of which such
deduction or withholding is required to be made shall
be increased to the extent necessary to ensure that,
after the making of such deduction or withholding,
the Lender or the Agent receives and retains (free
from any liability in respect of any such deduction
or
40
withholding) a net sum equal to the sum which it
would have received and so retained had no such
deduction or withholding been made or required to be
made.
7.2.2 Without prejudice to the provisions of Clause 7.2.1,
if any Lender or the Agent on its behalf is required
to make any payment on account of Tax (not being a
tax imposed on the net income of its Office by the
jurisdiction in which it is incorporated or in which
its Office is located or any other tax existing and
applicable on the date of this Agreement under the
laws of any jurisdiction) on or in relation to any
sum received or receivable hereunder by such Lender
or the Agent on its behalf (including, without
limitation, any sum received or receivable under this
Clause 7) or any liability in respect of any such
payment is asserted, imposed, levied or assessed
against such Lender or the Agent on its behalf, the
Borrower shall, upon demand of the Agent, indemnify
such Lender or the Agent against such payment or
liability, together with any interest, penalties and
expenses payable or incurred in connection therewith,
other than interest, penalties, and expenses (a) that
accrue during any periods of time beginning on the
thirty first (31st) day (or such longer period as any
Lender may reasonably require) following the day on
which the Lender or the Agent, as applicable, has
actual knowledge of the imposition or assertion of
such Taxes or other Taxes, or (b) that are otherwise
imposed or asserted on account of the bad faith or
wilful neglect of such Lender or the Agent. If any
Lender proposes to make a claim under the provisions
of this Clause 7.2.2 it shall certify to the Borrower
in reasonable detail within thirty (30) days (or such
longer period as any Lender may reasonably require)
after becoming aware of the event by reason of which
it is entitled to make its claim or claims the basis
of its claim or claims, such certificate to be
conclusive, save for manifest error.
7.2.3 Without affecting the Borrower's obligations under
Clause 7.2.1 and in consultation with the Agent, the
affected Lender will then take all such reasonable
steps as may be open to it to mitigate the effect of
the event (for example (if then possible) by changing
its Office or transferring some or all of its rights
and obligations under this Agreement to another
financial institution reasonably acceptable to the
Borrower, Hermes and
41
the Agent). The reasonable costs of mitigating the
effect of any such change shall be borne by the
Borrower save where such costs are of an internal
administrative nature and are not incurred in
dealings by any Lender with third parties.
7.2.4 Each Lender, on or prior to the date on which such
Lender becomes a Lender hereunder, through the Agent
(and from time to time thereafter as required by
applicable law, but only for so long as such Lender
is legally entitled to do so or the Agent is
instructed to do so), shall deliver to the Borrower
two (2) duly completed copies of either (a) Internal
Revenue Service Form W-8BEN claiming eligibility of
the Lender for benefits of an income tax treaty to
which the United States is a party that reduces the
rate of withholding on interest to zero or (b)
Internal Revenue Service Form W-8ECI, or in either
case an applicable successor form.
7.2.5 No person to which a Lender assigns part or all of
its interest under this Agreement pursuant to Clause
17 shall be entitled to receive any greater increase
in payment under Clause 7.2.1 than the assigning
Lender would have been entitled to receive with
respect to the rights assigned unless such assignment
shall have been made at a time when the circumstances
giving rise to such greater payment did not exist.
Each assignee shall, on or prior to the date on which
the assignor assigns all or part of its interest to
such assignee, comply with the certification
requirements of Clause 7.2.3.
7.3 PRODUCTION OF RECEIPTS FOR TAXES
If the Borrower makes any payment hereunder in Dollars or in
Euro in respect of which it is required by law to make any
deduction or withholding for Taxes, it shall pay the full
amount to be deducted or withheld to the relevant taxation or
other authority within the time allowed for such payment under
applicable law and shall deliver to the Agent within thirty
(30) days after they have made such payment to the applicable
authority any original receipt issued by such authority
evidencing the payment to such authority of all amounts so
required to be deducted or withheld from such payment.
42
If an additional payment is made under Clause 7.2.1 and any
Lender or the Agent on its behalf determines that it has
received or been granted a credit against or relief of or
calculated with reference to the deduction or withholding
giving rise to such additional payment, such Lender or the
Agent (as the case may be) shall, to the extent that it can do
so without prejudice to the retention of the amount of such
credit, relief, remission or repayment and provided that it
has received the cash benefit of such credit, relief or
remission, pay to the Borrower such amount as such Lender or
the Agent shall in its reasonable opinion have concluded to be
attributable to the relevant deduction or withholding. Any
such payment shall be conclusive evidence of the amount due to
the Borrower hereunder and shall be accepted by the Borrower
in full and final settlement of its rights of reimbursement
hereunder in respect of such deduction or withholding. Nothing
herein contained shall interfere with the right of any Lender
and the Agent to arrange their respective tax affairs in
whatever manner they think fit.
7.4 MONEY OF ACCOUNT
If any sum due from the Borrower under this Agreement or any
other Security Document to which it may at any time be a
party, or any order or judgment given or made in relation
thereto, has to be converted from the currency (the "FIRST
CURRENCY") in which the same is payable under such Security
Document, order or judgment into another currency (the "SECOND
CURRENCY") for the purpose of:
7.4.1 making or filing a claim or proof against the
Borrower;
7.4.2 obtaining an order or judgment in any court or other
tribunal; or
7.4.3 enforcing any order or judgment given or made in
relation thereto;
the Borrower shall indemnify and hold harmless the Agent and
each of the Lenders from and against any damages or losses
suffered as a result of any discrepancy between (a) the rate
of exchange used to convert the sum in question from the first
currency into the second currency and (b) the rate or rates of
exchange at which each Lender and the Agent (as the case may
be) may in the ordinary course of business purchase the first
currency with the second currency upon receipt of a sum paid
to it in satisfaction, in whole or in part, of any such order,
judgment, claim or proof. The above indemnity shall constitute
an
43
obligation of the Borrower separate and independent from its
other obligations and shall apply irrespective of any
indulgence granted by the Agent or any of the Lenders.
7.5 ACCOUNTS
The Agent shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and
owing to each of the Lenders hereunder or under any of the
other Security Documents. In any legal action or proceeding
arising out of or in connection with this Agreement or any
other Security Document, the entries made in the accounts so
maintained shall be prima facie evidence, save in the case of
manifest error, of the existence and amounts of the
obligations of the Borrower recorded therein.
7.6 EARNINGS
Provided no Event of Default or Possible Event of Default has
occurred (following which the Agent shall (inter alia) be
entitled to request the Borrower to give notice pursuant to
clause 3 of the Earnings Assignment and apply such Earnings in
accordance with Clause 12.1) such Earnings shall throughout
the Security Period be at the free disposal of the Borrower
but the net earnings of the Vessel shall be paid by the
Manager to the Operating Account within five (5) Business Days
of the end of each cruise of the Vessel.
7.7 CONTINUING SECURITY
The security created by this Agreement and each of the other
Security Documents shall be held by the Trustee and/or the
Agent and/or the Lenders and/or the Hermes Agent as a
continuing security for the repayment of the Outstanding
Indebtedness and the security so created shall not be
satisfied by any intermediate payment or satisfaction of any
part of the amount hereby or thereby secured or by any
amendment of this Agreement or any of the other Security
Documents. Such security shall be in addition to and shall not
in any way be prejudiced or affected by any collateral or
other security now or hereafter held by the Trustee, the
Agent, the Lenders, the Hermes Agent or any of them for all or
any part of the amount hereby or thereby secured or any other
right or remedy of the Trustee, the Agent, the Lenders or the
Hermes Agent or any of them under this Agreement or any of
44
the other Security Documents, by operation of law or otherwise
howsoever arising. All the powers arising from such security
may be exercised from time to time as the Trustee and/or the
Agent and/or the Hermes Agent may deem expedient.
8 YIELD PROTECTION AND FORCE MAJEURE
8.1 INCREASED COSTS
If by reason of:
8.1.1 any change in law or in its interpretation or
administration; and/or
8.1.2 compliance with any request from or requirement of
any central bank or other fiscal, monetary or other
authority including but without limitation the Basle
Committee on Banking Regulations and Supervisory
Practices whether or not having the force of law:
(a) any of the Lenders incurs a cost as a result
of its performing its obligations under this
Agreement and/or its advancing its
Contribution hereunder; or
(b) there is any increase in the cost to any of
the Lenders of funding or maintaining all or
any of the advances comprised in a class of
advances formed by or including its
Contribution advanced or to be advanced by
it hereunder; or
(c) any of the Lenders incurs a cost as a result
of its having entered into and/or its
assuming or maintaining its commitment under
this Agreement; or
(d) any of the Lenders becomes liable to make
any payment on account of Tax or otherwise
(other than Tax on its overall net income)
on or calculated by reference to the amount
of its Contribution advanced or to be
advanced hereunder and/or any sum received
or receivable by it hereunder; or
(e) any of the Lenders suffers any decrease in
its rate of return as a result of any
changes in the requirements relating to
capital ratios,
45
monetary control ratios, the payment of
special deposits, liquidity costs or other
similar requirements affecting that Lender,
then the Borrower shall from time to time on demand pay to the
Agent for the account of the relevant Lender or Lenders
amounts sufficient to indemnify the relevant Lender or Lenders
against, as the case may be, such cost, such increased cost
(or such proportion of such increased cost as is in the
reasonable opinion of the relevant Lender or Lenders
attributable to the funding or maintaining of its or their
Contribution(s) hereunder) or such liability.
A Lender affected by any provision of Clause 8.1 shall
promptly inform the Agent after becoming aware of the relevant
change and its possible results (which notice shall be
conclusive evidence of the relevant change and its possible
results) and the Agent shall, as soon as reasonably
practicable thereafter, notify the Borrower of the change and
its possible results. Without affecting the Borrower's
obligations under Clause 8.1 and in consultation with the
Agent, the affected Lender will then take all such reasonable
steps as may be open to it to mitigate the effect of the
change (for example (if then possible) by changing its Office
or transferring some or all of its rights and obligations
under this Agreement to another financial institution
reasonably acceptable to the Borrower and the Agent). The
reasonable costs of mitigating the effect of any such change
shall be borne by the Borrower save where such costs are of an
internal administrative nature and are not incurred in
dealings by any Lender with third parties.
8.2 FORCE MAJEURE
Where the Agent, the Hermes Agent, the Trustee or any Lender
(the "NON-PERFORMING PARTY") is prevented from performing any
of its obligations under this Agreement by reason of Force
Majeure this Agreement shall remain in effect but the
Non-Performing Party's relevant obligations shall be suspended
for so long as the Force Majeure continues and to the extent
that the Non-Performing Party is so prevented, PROVIDED THAT:
8.2.1 the suspension of performance is of no greater scope
and of no longer duration than is required by the
Force Majeure;
46
8.2.2 the obligations of the Non-Performing Party shall not
be excused as a result of the Force Majeure; and
8.2.3 in respect of the suspension of the Non-Performing
Party's obligations:
(a) the Non-Performing Party gives the Agent
prompt written notice which the Agent shall
forthwith upon receipt send to the Borrower
describing the circumstances of Force
Majeure (including the nature of the
occurrence, its expected duration and the
effects of the Force Majeure on the ability
of the Non-Performing Party to perform its
relevant obligations), and continues to
furnish weekly reports with respect thereto
during the period of Force Majeure;
(b) the Non-Performing Party uses all reasonable
efforts to remedy its inability to perform
and to mitigate the effects of the Force
Majeure; and
(c) as soon as reasonably possible after the
cessation of the Force Majeure the
Non-Performing Party shall notify the Agent
(who shall notify the Borrower) in writing
of such cessation and shall resume
performance of its obligations under this
Agreement if such resumption is then
possible.
9 REPRESENTATIONS AND WARRANTIES
9.1 DURATION
The representations and warranties in Clause 9.2, Clause 9.3
and Clause 9.4 shall survive the execution of this Agreement
and shall be deemed to be repeated, with reference mutatis
mutandis to the facts and circumstances subsisting, as if made
on each day until the Borrower has no remaining obligations,
actual or contingent, under or pursuant to this Agreement or
any of the other Security Documents.
9.2 REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agent and each of
the Lenders that:
47
9.2.1 STATUS
Each Obligor is a corporation duly organised,
constituted and validly existing under the laws of
the country of its incorporation, possessing
perpetual corporate existence, the capacity to xxx
and be sued in its own name and the power to own and
charge its assets and carry on its business as it is
now being conducted.
9.2.2 POWERS AND AUTHORITY
Each of the Obligors has the power to enter into and
perform this Agreement and those of the other
Security Documents to which it is a party and the
transactions contemplated hereby and thereby and has
taken all necessary action to authorise the entry
into and performance of this Agreement and such other
Security Documents and such transactions.
9.2.3 LEGAL VALIDITY
This Agreement and each other Transaction Document
(other than the Hermes Cover) constitutes (or will
constitute when executed) legal, valid and binding
obligations of each Obligor and the Builder expressed
to be a party thereto enforceable in accordance with
their respective terms and in entering into this
Agreement and borrowing the Loan, the Borrower is
acting on its own account.
9.2.4 NON-CONFLICT WITH LAWS
The entry into and performance of this Agreement and
the other Transaction Documents (other than the
Hermes Cover) and the transactions contemplated
hereby and thereby do not and will not conflict with:
(a) any law or regulation or any official or
judicial order; or
(b) the constitutional documents of any Obligor;
or
(c) any agreement or document to which any
Obligor is a party or which is binding upon
such Obligor or any of its assets,
48
nor result in the creation or imposition of any
Encumbrance on an Obligor or its assets pursuant to
the provisions of any such agreement or document.
9.2.5 NO DEFAULT
Save as disclosed in the Disclosure Letter no event
has occurred which constitutes a default under or in
respect of any Transaction Document to which any
Obligor, the Builder or Hermes is a party or by which
any Obligor, the Builder or Hermes may be bound
(including (inter alia) this Agreement) and no event
has occurred which, with the giving of notice, lapse
of time, determination of materiality or other
condition might constitute a default under or in
respect of any such Transaction Document and no event
has occurred which constitutes a default under or in
respect of any agreement or document to which any
Obligor is a party or by which any Obligor may be
bound to an extent or in a manner which might have a
material adverse effect on its business, assets or
financial condition and no event has occurred which,
with the giving of notice, lapse of time,
determination of materiality or other condition might
constitute a default under or in respect of any such
agreement or document.
9.2.6 CONSENTS
Except for:
(a) the filing of those Security Documents to be
filed with the Secretary of State of
Delaware, the Companies Registries in the
Isle of Man, England and Wales or the
Federal Republic of Germany, which filings
must be completed within twenty one (21)
days of the execution of the relevant
Security Document(s) in the case of England
and Wales; and
(b) the registration of the Pre-Delivery
Mortgage in the Shipbuilding Register in
Emden and the recording of the Post Delivery
Mortgage at the US Coast Guard National
Vessel Documentation Center,
49
all authorisations, approvals, consents,
licences, exemptions, filings,
registrations, notarisations and other
matters, official or otherwise, required in
connection with the entry into, performance,
validity and enforceability of this
Agreement and each of the other Transaction
Documents to which any Obligor or the
Builder is a party and the transactions
contemplated thereby have been obtained or
effected and are in full force and effect
except authorisations, approvals, consents,
licences, exemptions, filings and
registrations required in the normal day to
day course of the operation of the Vessel
and not already obtained by the Borrower.
9.2.7 ACCURACY OF INFORMATION
All information furnished by any Obligor relating to
the business and affairs of any Obligor in connection
with this Agreement and the other Transaction
Documents was and remains true and correct in all
material respects and there are no other material
facts or considerations the omission of which would
render any such information misleading.
9.2.8 FULL DISCLOSURE
Each Obligor has fully disclosed in writing to the
Agent all facts relating to each Obligor and the
Builder which it knows or should reasonably know and
which might reasonably be expected to influence the
Lenders in deciding whether or not to enter into this
Agreement.
9.2.9 NO ENCUMBRANCES
None of the assets or rights of any Obligor is
subject to any Encumbrance except Permitted Liens.
9.2.10 PARI PASSU OR PRIORITY STATUS
The claims of the Agent and the Lenders against the
Borrower under this Agreement will rank at least pari
passu with the claims of all unsecured creditors of
the Borrower (other than claims of such creditors to
the extent that they are statutorily preferred) and
in priority to the claims of any creditor of the
Borrower who is also an Obligor and the Builder.
50
9.2.11 SOLVENCY
The Borrower is and shall remain, after the advance
to it of the Facility, solvent in accordance with the
laws of the State of Delaware and the United Kingdom
and in particular with the provisions of the
Insolvency Xxx 0000 (as from time to time amended)
and the requirements thereof.
9.2.12 WINDING-UP, ETC.
Neither the Borrower nor any other Obligor has taken
any corporate action nor have any other steps been
taken or legal proceedings been started or (to the
best of its knowledge and belief) threatened against
any of them for the reorganisation, winding-up,
dissolution or for the appointment of a liquidator,
administrator, receiver, administrative receiver,
trustee or similar officer of any of them or any or
all of their assets or revenues nor has it sought any
other relief under any applicable insolvency or
bankruptcy law.
9.2.13 ACCOUNTS
The consolidated audited accounts of the Group for
the periods ending on 31 December 2002 and 31
December 2003 and the consolidated audited accounts
of the NCLC Group for the period ending on 31
December 2004 and for all subsequent periods (which
accounts will be prepared in accordance with GAAP)
fairly represent the financial condition of the Group
or the NCLC Group (as the case may be) as shown in
such audited accounts (in this Clause 9.2.13 "NCLC
GROUP" shall have the meaning ascribed to it in
clause 11.4 of the Guarantee).
9.2.14 LITIGATION
Save as disclosed in writing to the Agent by way of
the Disclosure Letter no litigation, arbitration or
administrative proceedings are current or pending or,
to its knowledge, threatened, which might, if
adversely determined, have a material adverse effect
on the business, assets or financial condition of any
Obligor.
51
9.2.15 TAX LIABILITIES
The NCLC Group has complied with all taxation laws in
all jurisdictions in which it is subject to Taxation
and has paid all Taxes due and payable by it
including but without limitation any disputed Taxes
unless a reserve has been made pending resolution of
the dispute; no material claims are being asserted
against it with respect to Taxes, which might, if
such claims were successful, have a material adverse
effect on its business, assets or financial
condition.
9.2.16 OWNERSHIP OF ASSETS
Each member of the Group or the NCLC Group (as the
case may be) has good and marketable title to all its
assets which are reflected in the audited accounts
referred to in Clause 9.2.13.
9.2.17 NO IMMUNITY
None of the Obligors nor any of their respective
assets enjoys any right of immunity (sovereign or
otherwise) from set-off, suit or execution in respect
of their obligations under this Agreement or any of
the other Transaction Documents or by any relevant or
applicable law.
9.2.18 TAXES ON PAYMENTS
As at the date of this Agreement all amounts payable
by them hereunder in Dollars or in Euro may be made
free and clear of and without deduction for or on
account of any Taxation.
9.2.19 PLACE OF BUSINESS
None of the Obligors has a place of business in any
jurisdiction (except as already disclosed) which
requires any of the Security Documents to be filed or
registered in that jurisdiction to ensure the
validity of the Security Documents to which it is a
party.
52
9.2.20 OWNERSHIP OF SHARES
All the Shares in the Borrower and the Manager shall
be legally and beneficially owned by the Shareholder,
all the shares in the Sub-Agent shall be legally and
beneficially owned by NCL International, all the
shares in the Shareholder shall be legally and
beneficially owned by Arrasas, all the shares in
Arrasas shall be legally and beneficially owned by
the Guarantor and all the shares in the Supervisor
shall be legally and beneficially owned by Star and
such structure shall remain so throughout the
Security Period. Further, no Event of Default has
occurred under clause 11.2 of the Guarantee in
respect of the ownership and/or control of the shares
in the Guarantor.
9.2.21 COMPLETENESS OF DOCUMENTS
The copies of the Building Contract, the Supervision
Agreement, the Management Agreement the Sub-Agency
Agreement, the Interest Exchange Arrangements and any
other relevant third party agreements delivered to
the Agent are true and complete copies of each such
document constituting valid and binding obligations
of the parties thereto enforceable in accordance with
their respective terms and no amendments thereto or
variations thereof have been agreed nor has any
action been taken by the parties thereto which would
in any way render such document inoperative or
unenforceable.
9.2.22 NO UNDISCLOSED COMMISSIONS
Other than the Hermes Premium, there are and will be
no commissions, rebates, premiums or other payments
by or to or on account of any Obligor or the Builder,
their shareholders, directors or officers in
connection with the transaction as a whole other than
as disclosed to the Agent in writing.
9.2.23 MONEY LAUNDERING
Any borrowing by the Borrower under this Agreement,
and the performance of its obligations under this
Agreement and the other Transaction Documents, will
be for its own account and will not involve
53
any breach by it of any law or regulatory measure
relating to "MONEY LAUNDERING" as defined in Article
1 of the Directive (91/308/EEC) of the Council of the
European Communities.
9.2.24 ENVIRONMENT
Each of the Obligors:
(a) is in compliance with all applicable
federal, state, local, foreign and
international laws, regulations, conventions
and agreements relating to pollution
prevention or protection of human health or
the environment (including, without
limitation, ambient air, surface water,
ground water, navigable waters, water of the
contiguous zone, ocean waters and
international waters), including without
limitation, laws, regulations, conventions
and agreements relating to:
(i) emissions, discharges, releases or
threatened releases of chemicals,
pollutants, contaminants, wastes,
toxic substances, hazardous
materials, oil, hazard substances,
petroleum and petroleum products
and by-products ("MATERIALS OF
ENVIRONMENTAL CONCERN"); or
(ii) the manufacture, processing,
distribution, use, treatment,
storage, disposal, transport or
handling of Materials of
Environmental Concern (such laws,
regulations, conventions and
agreements the "ENVIRONMENTAL
LAWS");
(b) has all permits, licences, approvals,
rulings, variances, exemptions, clearances,
consents or other authorisations required
under applicable Environmental Laws
("ENVIRONMENTAL APPROVALS") and are in
compliance with all Environmental Approvals
required to operate its business as
presently conducted or as reasonably
anticipated to be conducted;
(c) has not received any notice, claim, action,
cause of action, investigation or demand by
any other person, alleging potential
54
liability for, or a requirement to incur,
investigatory costs, clean-up costs,
response and/or remedial costs (whether
incurred by a governmental entity or
otherwise), natural resources damages,
property damages, personal injuries,
attorney's fees and expenses or fines or
penalties, in each case arising out of,
based on or resulting from:
(i) the presence or release or threat
of release into the environment of
any Material of Environmental
Concern at any location, whether or
not owned by such person; or
(ii) circumstances forming the basis of
any violation, or alleged
violation, of any Environmental Law
or Environmental Approval
("ENVIRONMENTAL CLAIM"); and
there are no circumstances that may prevent or
interfere with such full compliance in the future.
There is no Environmental Claim pending or threatened
against any of the Obligors.
There are no past or present actions, activities,
circumstances, conditions, events or incidents,
including, without limitation, the release, emission,
discharge or disposal of any Material of
Environmental Concern, that could form the basis of
any Environmental Claim against any of the Obligors.
9.3 REPRESENTATIONS ON THE FIRST DRAWDOWN DATE
The Borrower further represents and warrants to the Agent and
each of the Lenders that on the First Drawdown Date the Vessel
will be:
9.3.1 in its absolute and unencumbered ownership save as
contemplated by the Security Documents;
9.3.2 registered in its name in the Shipbuilding Register
in Emden;
55
9.3.3 insured in accordance with the provisions of the
Building Contract, this Agreement and the
Pre-Delivery Mortgage and in compliance with the
requirements therein in respect of such insurances;
and
9.3.4 under construction supervision by the Supervisor on
and subject to the terms set out in the Supervision
Agreement.
9.4 REPRESENTATIONS ON THE DELIVERY DATE
The Borrower further represents and warrants to the Agent and
each of the Lenders that on the Delivery Date the Vessel will
be:
9.4.1 in its absolute and unencumbered ownership save as
contemplated by the Security Documents;
9.4.2 registered in its name under the laws and flag of the
United States of America;
9.4.3 classed with the highest classification available for
a vessel of its type free of all recommendations and
qualifications with Det Norske Veritas and American
Bureau of Shipping;
9.4.4 operationally seaworthy and in compliance with all
relevant provisions, regulations and requirements
(statutory or otherwise) applicable to ships
registered under the laws and flag of the United
States of America;
9.4.5 insured in accordance with the provisions of Clause
10.21 and in compliance with the requirements therein
in respect of such insurances; and
9.4.6 managed by the Manager and the Sub-Agent on and
subject to the terms set out in the Management
Agreement and the Sub-Agency Agreement.
10 UNDERTAKINGS
10.1 DURATION
The undertakings in this Clause 10 shall survive the execution
of this Agreement and shall be deemed to be repeated with
reference mutatis mutandis to the facts and circumstances
subsisting, as if made on each day until the Borrower has no
56
remaining obligations, actual or contingent, under or pursuant
to this Agreement or any of the other Security Documents.
10.2 INFORMATION
The Borrower will provide to the Agent for the benefit of the
Lenders (or will procure the provision of):
10.2.1 as soon as practicable (and in any event within one
hundred and twenty (120) days after the close of each
of its financial years) a Certified Copy of its
audited accounts for that year and of the
consolidated Group accounts for that year (commencing
with audited accounts made up to 31 December 2002)
such Group accounts being substituted with NCLC Group
accounts commencing with the audited accounts made up
to 31 December 2004;
10.2.2 as soon as practicable (and in any event within forty
five (45) days of the end of each quarter of each
financial year) a Certified Copy of the unaudited
consolidated accounts of the NCLC Group and the
unaudited accounts of the Borrower for that quarter
(commencing with unaudited accounts made up to 31
March 2004);
10.2.3 promptly, such further information in its possession
or control regarding its financial condition and
operations and those of any company in the NCLC Group
as the Agent may request;
10.2.4 details of any material litigation, arbitration or
administrative proceedings which affect any Obligor
as soon as the same are instituted and served, or, to
the knowledge of the Borrower, threatened (and for
this purpose proceedings shall be deemed to be
material if they involve a claim in an amount
exceeding five million Dollars (USD5,000,000) or the
equivalent in another currency).
All accounts required under this Clause 10.2 shall be prepared
in accordance with GAAP and shall fairly represent the
financial condition of the relevant company. In this Clause
10.2 "NCLC GROUP" shall have the meaning ascribed to it in
clause 11.4 of the Guarantee.
57
10.3 NOTIFICATION OF DEFAULT
The Borrower will notify the Agent of any Event of Default or
Possible Event of Default forthwith upon any Obligor becoming
aware of the occurrence thereof. Upon the Agent's request from
time to time the Borrower will issue a certificate stating
whether any Obligor is aware of the occurrence of any Event of
Default or Possible Event of Default.
10.4 CONSENTS AND REGISTRATIONS
The Borrower will procure that (and will promptly furnish
Certified Copies to the Agent of) all such authorisations,
approvals, consents, licences and exemptions as may be
required under any applicable law or regulation to enable it
or any Obligor to perform its obligations under, and ensure
the validity or enforceability of, each of the Transaction
Documents are obtained and promptly renewed from time to time
and will procure that the terms of the same are complied with
at all times. Insofar as such filings or registrations have
not been completed on or before the relevant Drawdown Date the
Borrower will procure the filing or registration within
applicable time limits of each Security Document which
requires filing or registration together with all ancillary
documents required to preserve the priority and enforceability
of the Security Documents.
10.5 NEGATIVE PLEDGE
The Borrower will not create or permit to subsist any
Encumbrance on the whole or any part of its present or future
assets, except for the following:
10.5.1 Encumbrances created with the prior consent of the
Lenders; or
10.5.2 Permitted Liens.
10.6 DISPOSALS
Except with the prior consent of all the Lenders, the Borrower
shall not (and will procure that no other company in the NCLC
Group shall), either in a single transaction or in a series of
transactions whether related or not and whether voluntarily or
involuntarily, sell, transfer, lease or otherwise dispose of
all or a substantial part of its assets except that the
following disposals shall not be taken into account:
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10.6.1 disposals made in the ordinary course of trading of
the disposing entity (excluding disposal of ships)
including without limitation, the payment of cash as
consideration for the purchase or acquisition of any
asset or service or in the discharge of any
obligation incurred for value in the ordinary course
of trading;
10.6.2 disposals of cash raised or borrowed for the purposes
for which such cash was raised or borrowed;
10.6.3 disposals of assets in exchange for other assets
comparable or superior as to type and value; and
10.6.4 a vessel owned by any member of the NCLC Group (other
than the Borrower) may be sold provided such sale is
on a willing seller willing buyer basis at or about
market rate and at arm's length subject always to the
provisions of any loan documentation for the
financing of such vessel and NCLL may, following the
sale of its shares by Arrasas to IOL, a wholly owned
Subsidiary of Star, transfer to other wholly owned
Subsidiaries of Star its vessels "NORWEGIAN WIND",
"NORWEGIAN DREAM", "NORWEGIAN SEA", "NORWEGIAN
MAJESTY", "NORWEGIAN CROWN" and "XXXXX XXXX" (the
"SIX VESSELS") for their transfer values as set out
in Schedule 8 and sell m.v. "NORWAY" to a third party
and, prior to the sale of its shares as aforesaid,
transfer its vessel "NORWEGIAN SKY" to Pride of Aloha
Inc., a wholly owned Subsidiary of the Shareholder;
10.6.5 the Subsidiaries of Star to whom the Six Vessels (as
defined in Clause 10.6.4) have been transferred may
let each of the Six Vessels on demise or bareboat
charter to the Sub-Agent for the period and at the
charterhire rate set out in Schedule 8; and
10.6.6 Arrasas may transfer its shares in NCLL to IOL and
Star may transfer its shares in Arrasas to the
Guarantor.
10.7 CHANGE OF BUSINESS
Except with the prior consent of the Agent, the Borrower shall
not make or threaten to make any substantial change in its
business as presently conducted,
59
namely that of a single ship owning company for the Vessel, or
carry on any other business which is substantial in relation
to its business as presently conducted so as to affect, in the
opinion of the Agent, the Borrower's ability to perform its
obligations hereunder and shall not form any Subsidiaries and
the Borrower will procure that the other Obligors continue,
throughout the Security Period, to perform their current
business activities.
10.8 MERGERS
Except with the prior consent of the Agent and Hermes, the
Borrower will not enter into any amalgamation, restructure,
substantial reorganisation, merger or consolidation or
anything analogous to the foregoing and will procure that no
company in the NCLC Group shall do so. However, the prior
consent of the Agent shall not be required in respect of any
consolidation, reorganisation or restructure involving wholly
owned (whether directly or indirectly) Subsidiaries of the
Guarantor only which does not imperil the security created by
any of the Security Documents or affect the ability of any
Obligor duly to perform any of its obligations under any
Security Document to which it may be a party at any time,
provided that the Borrower has first consulted with the Agent
with regard to the proposed consolidation, reorganisation or
restructure and provides evidence satisfactory to the Agent
that the Guarantor will be in compliance with the financial
undertakings contained in clause 11 of the Guarantee after any
such consolidation, reorganisation or restructure. Further, no
member of the NCLC Group will acquire any equity, share
capital or obligations of any corporation or other entity
PROVIDED THAT NCL International or the Shareholder may so
acquire equity, share capital or obligations of a corporation
or entity whose business is the ownership, operation or
management of cruise vessels. For the avoidance of doubt, the
acquisition by a member of the NCLC Group of any shares in any
company or corporation shall not in itself constitute a merger
or consolidation with such company or corporation for the
purpose of this Clause 10.8 provided that the Agent is
satisfied the Guarantor will be in compliance with the
financial undertakings contained in Clause 11 of the Guarantee
after any such merger or consolidation.
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10.9 MAINTENANCE OF STATUS AND FRANCHISES
The Borrower will do all such things as are necessary to
maintain its corporate existence in good standing and will
ensure that it has the right and is duly qualified to conduct
its business as it is conducted in all applicable
jurisdictions and will obtain and maintain all franchises and
rights necessary for the conduct of its business.
10.10 FINANCIAL RECORDS
The Borrower will keep proper books of record and account, in
which proper and correct entries shall be made of all
financial transactions and the assets, liabilities and
business of the Borrower in accordance with GAAP.
10.11 FINANCIAL INDEBTEDNESS AND SUBORDINATION OF INDEBTEDNESS
10.11.1 Otherwise than in the ordinary course of business as
owner of the Vessel, except as contemplated by this
Agreement and except any loan, advance or credit
extended by the Guarantor or any member of the NCLC
Group which is a wholly owned Subsidiary of the
Guarantor, the Borrower will not create, incur,
assume or allow to exist any financial indebtedness,
enter into any finance lease or undertake any
material capital commitment (including but not
limited to the purchase of any capital asset).
10.11.2 The Borrower shall procure that any and all
indebtedness (and in particular with any other
Obligor) is at all times fully subordinated to the
Security Documents and the obligations of the
Borrower hereunder. Upon the occurrence of an Event
of Default or a Possible Event of Default, the
Borrower shall not make any repayments of principal,
payments of interest or of any other costs, fees,
expenses or liabilities arising from or representing
such indebtedness. In this Clause "FULLY
SUBORDINATED" shall mean that any claim of the lender
against the Borrower in relation to such indebtedness
shall rank after and be in all respects subordinate
to all of the rights and claims of the Agent, the
Hermes Agent and the Lenders under this Agreement and
the other Security Documents and that the lender
shall not take any steps to enforce its rights to
recover any monies owing to it by the Borrower and in
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particular but without limitation the lender will not
institute any legal or quasi-legal proceedings under
any jurisdiction at any time against the Vessel, its
Earnings or Insurances or the Borrower and it will
not compete with the Agent, the Hermes Agent or the
Lenders in a liquidation or other winding-up or
bankruptcy of the Borrower or in any proceedings in
connection with the Vessel, its Earnings or
Insurances.
10.12 POOLING OF EARNINGS AND CHARTERS
The Borrower will not enter into in respect of the Vessel (A)
any pooling agreement or other arrangement for the sharing of
any of the Earnings or the expenses of the Vessel or (B) any
demise or bareboat charter or (C) any charter whereunder two
(2) months' charterhire (or the equivalent thereof) is payable
in advance in respect of the Vessel or (D) any charter of the
Vessel or contract of affreightment which, with the exercise
of options for extension, could be for a period longer than
thirteen (13) months but if, with the prior written consent of
the Agent, the Borrower enters into in respect of the Vessel a
charter with a company outside the Group, the Borrower hereby
undertakes to execute in favour of the Trustee an assignment
of such charter and the Earnings therefrom such assignment to
be in substantially the form of the Earnings Assignment and as
required by the Agent PROVIDED HOWEVER THAT the Borrower may
in respect of the Vessel enter into a bareboat charter in form
approved by the Agent with any company which is a member of
the Group PROVIDED THAT if so requested by the Agent and
without limitation:
10.12.1 any such bareboat charterer shall enter into such
deeds (including but not limited to a subordination
and assignment deed), agreements and indemnities as
the Agent shall in its sole discretion require prior
to entering into the bareboat charter with the
Borrower; and
10.12.2 the Borrower shall assign the benefit of any such
bareboat charter and its interest in the Insurances
to the Trustee by way of further security for the
Borrower's obligations under the Security Documents.
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10.13 LOANS AND GUARANTEES BY THE BORROWER
Otherwise than in the ordinary course of business as owner of
the Vessel or except as contemplated hereby, the Borrower will
not make any loan or advance or extend credit to any person,
firm or corporation (except any loans, advances or credits
made available to (a) passengers on board the Vessel for
gambling purposes (b) ship's agents and/or (c) the Guarantor
and/or members of the NCLC Group which are wholly owned
Subsidiaries of the Guarantor and, in the case of such loans,
advances or credits as are referred to in this paragraph (c),
do not prevent the Borrower from performing its obligations
hereunder) or issue or enter into any guarantee or indemnity
or otherwise become directly or contingently liable for the
obligations of any other person, firm or corporation.
10.14 SUPERVISION AND MANAGEMENT
Except with the prior consent of the Agent, the Borrower will
not permit any person other than the Supervisor, the Manager
and the Sub-Agent to be the supervisor of construction and the
manager and Sub-Agent of the ship and crewing services of the
Vessel respectively, permit any amendment to be made to the
terms of the Supervision Agreement, the Management Agreement
or the Sub-Agency Agreement or permit the Vessel to be
employed other than within the NCL or NCL America brand (as
applicable).
10.15 ACQUISITION OF SHARES
The Borrower will not acquire any equity, share capital,
assets or obligations of any corporation or other entity or
permit its Shares to be held by any party other than the
Shareholder.
10.16 TRADING WITH THE UNITED STATES OF AMERICA
Where the Vessel trades in the territorial waters of the
United States of America, the Borrower shall in respect of the
Vessel take all reasonable precautions to prevent any
infringements of the Anti-Drug Abuse Act of 1986 of the United
States of America (as the same may be amended and/or
re-enacted from time to time hereafter) or any similar
legislation applicable to the Vessel in any other jurisdiction
in which the Vessel shall trade (a "RELEVANT JURISDICTION")
and, for this purpose the Borrower shall (inter alia) enter
into a "Carrier Initiative
63
Agreement" with the United States' Customs Service (if such is
possible) and procure that the same (or a similar agreement in
a Relevant Jurisdiction) is maintained in full force and
effect and its obligations thereunder performed by it in
respect of the Vessel throughout any period of United States
of America (including coastal waters over which it claims
jurisdiction) or Relevant Jurisdiction related trading.
10.17 FURTHER ASSURANCE
The Borrower will, from time to time on being required to do
so by the Agent, do or procure the doing of all such acts
and/or execute or procure the execution of all such documents
in a form satisfactory to the Agent as the Agent may
reasonably consider necessary for giving full effect to any of
the Transaction Documents or securing to the Trustee, the
Agent, the Hermes Agent and the Lenders the full benefit of
the rights, powers and remedies conferred upon the Trustee,
the Agent, the Hermes Agent or the Lenders in any such
Transaction Document.
10.18 VALUATION OF THE VESSEL
10.18.1 The Borrower will from time to time (but at intervals no more
frequently than twice annually at the Borrower's expense)
within fifteen (15) days of receiving any request to that
effect from the Agent, procure that the Vessel is valued by an
independent reputable shipbroker or shipvaluer experienced in
valuing cruise ships appointed by the Borrower and approved by
the Agent (which approval shall not be unreasonably withheld
or delayed and such valuation to be made with or without
taking into account the benefit or otherwise of any fixed
employment relating to the Vessel as the Agent may require).
10.18.2 If the Borrower does not accept the valuation
obtained pursuant to Clause 10.18.1 (the "FIRST
VALUATION") it may (at its own expense) within five
(5) Business Days of receipt of the First Valuation
obtain a second valuation (the "SECOND VALUATION")
from another independent reputable shipbroker or
shipvaluer experienced in valuing cruise ships
appointed by the Borrower and approved by the Agent
which approval shall not be unreasonably withheld or
delayed.
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10.18.3 If the Second Valuation exceeds the First Valuation
by a margin of no less than ten per cent (10%) of the
First Valuation the Borrower may at its expense
forthwith upon receipt of the Second Valuation
request the shipbrokers and/or shipvaluers appointed
pursuant to Clauses 10.18.1 and 10.18.2 to obtain a
third valuation (the "THIRD VALUATION") from a
further independent reputable shipbroker or
shipvaluer experienced in valuing cruise ships
approved by the Agent such approval not to be
unreasonably withheld or delayed. Subject to the
Third Valuation being made available within five (5)
Business Days of the date of the Second Valuation the
valuation of the Vessel will be determined on the
basis of the average of the three valuations so
obtained. If the Third Valuation is not made
available within the aforementioned time limit the
Vessel shall be valued on the basis of the average of
the First Valuation and the Second Valuation.
10.18.4 The Borrower shall procure that forthwith upon the
issuance of any valuation obtained pursuant to this
Clause 10.18 a copy thereof is sent directly to the
Agent for review.
10.19 MARGINAL SECURITY
If at any time after the Delivery Date, the value of the
Vessel as assessed in accordance with the provisions of Clause
10.18 and the value of any additional cash collateral deposits
or the value of other security (not including any other
security provided by the existing Security Documents)
acceptable to the Agent provided by the Borrower or any third
party to secure the due performance by the Borrower of its
obligations hereunder at valuations reasonably estimated by
the Agent from time to time is less than one hundred and
twenty five per cent (125%) of the amount of the Loan, then
the Agent may give the Borrower notice requiring the Borrower
to provide additional security and in such event within thirty
(30) days of such notice, the Borrower will either:
10.19.1 provide the Agent with additional security acceptable
to the Agent such that the security value of the
Vessel or the aggregate of the security value of the
Vessel and any additional security provided to the
Agent hereunder (at valuations reasonably estimated
by the Agent from time to time) is at
65
least one hundred and twenty five per cent (125%) of
the amount of the Loan; or
10.19.2 prepay the Loan together with accrued interest on the
amount prepaid such that the value of the security is
one hundred and twenty five per cent (125%) of the
amount of the Loan.
10.20 PERFORMANCE OF EMPLOYMENT CONTRACTS
The Borrower will:
10.20.1 perform its obligations under each charterparty or
employment contract made in respect of the Vessel and
take all necessary steps to procure the due
performance of the obligations of any party under any
charterparty or contract. It will not without the
prior written consent of the Agent rescind, cancel or
otherwise terminate any charterparty or contract in
respect of the Vessel PROVIDED ALWAYS THAT any
determination by it of any such charterparty or
contract after such consent is given shall be without
responsibility on the part of the Agent who shall be
under no liability whatsoever in the event that such
termination thereafter be adjudged to constitute a
repudiation of such charterparty or contract by the
Borrower;
10.20.2 promptly notify the Agent (a) of any default under
any such charterparty or contract of which it has
knowledge by it and/or by any other party under any
other such charterparty or contract (b) of any such
charterparty or contract being frustrated or the
performance thereof becoming impossible or
substantially different from that contemplated
originally by the parties thereto;
10.20.3 institute and maintain all such proceedings as may be
necessary or expedient to preserve or protect the
interest of the Trustee as assignee and itself under
any of its charterparties or contracts made in
respect of the Vessel;
10.20.4 not take or omit to take any action the taking or
omission of which might result in any material
alteration or impairment of any charterparty or
contract made in respect of the Vessel;
66
10.20.5 not substitute any other ship or ships for the Vessel
under any charterparty or contract made in respect of
the Vessel;
10.20.6 not without the Agent's prior consent agree to any
material variation, modification or amendment in the
terms of any charterparty or contract in respect of
the Vessel or release any other party from any of
their respective obligations thereunder or waive any
breach of the obligations of any person or consent to
any such act or omission of any person as would
otherwise constitute such breach;
10.20.7 not without the Agent's prior consent let or employ
the Vessel below approximately the market rate
prevailing when the Vessel is fixed;
10.20.8 procure that the Earnings (if any) are paid in full
without set off and free and clear of and without
deduction for any taxes levies duties imposts charges
fees restrictions or conditions of any nature
whatsoever; and
10.20.9 if, immediately following the termination (for
whatever reason) of any charterparty or contract in
respect of the Vessel, the Vessel is not employed in
a manner acceptable to the Agent in its sole
discretion the Borrower shall provide additional
security for its obligations hereunder in such
manner, of such type and within such period as the
Agent may determine in its absolute discretion.
10.21 INSURANCES
The Borrower covenants with the Agent and the Lenders and
undertakes:
10.21.1 during the Construction Period to procure that the
Vessel is insured in accordance with the Building
Contract, to give notice forthwith of the assignment
of the Borrower's interest in the Insurances pursuant
to the Construction Risks Insurance Assignment to the
relevant brokers, insurances companies and/or
underwriters in the form approved by the Agent and to
procure that each of the relevant brokers furnishes
the Agent with a letter of undertaking in such form
as may be required by the Agent and waives any lien
for premiums except in relation to premiums
attributable to the Vessel;
67
10.21.2 from the Delivery Date until the end of the Security
Period to insure the Vessel in its name and keep the
Vessel insured on an agreed value basis for an amount
in Dollars approved by the Agent but not being less
than the greater of:
(a) one hundred and twenty five per cent (125%)
of the aggregate of the amounts of the
Dollar Loan and the Dollar equivalent of the
Euro Loan (determined at HSBC Bank plc's
spot rate for conversion of Dollars to Euro
at 10:00 a.m. London time ten (10) days
prior to the Delivery Date or any renewal
date); or
(b) the full market and commercial value of the
Vessel determined in accordance with Clause
10.18 from time to time
through internationally recognised independent first
class insurance companies, underwriters, war risks
and protection and indemnity associations acceptable
to the Agent in each instance on terms and conditions
approved by the Agent including as to deductibles but
at least in respect of:
(i) marine risks including all risks customarily
and usually covered by first-class and
prudent shipowners in the London insurance
markets under English marine policies or
Agent-approved policies containing the
ordinary conditions applicable to similar
vessels;
(ii) war risks and war risks (protection and
indemnity) up to the insured amount;
(iii) excess risks that is to say the proportion
of claims for general average and salvage
charges and under the running down clause
not recoverable in consequence of the value
at which the Vessel is assessed for the
purpose of such claims exceeding the insured
value;
(iv) protection and indemnity risks with full
standard coverage and up to the highest
limit of liability available (for oil
pollution risk the highest limit currently
available is one billion Dollars
(USD1,000,000,000) and this to be increased
if requested by the
68
Agent and the increase is possible in
accordance with the standard protection and
indemnity cover for vessels of its type and
is compatible with prudent insurance
practice for first class cruise shipowners
or operators in waters where the Vessel
trades from time to time from the Delivery
Date until the end of the Security Period);
(v) when and while the Vessel is laid-up, in
lieu of hull insurance, normal port risks;
(vi) such other risks as the Agent may from time
to time reasonably require;
and in any event in respect of those risks and at
those levels covered by first class and prudent
owners and/or financiers in the international market
in respect of similar tonnage PROVIDED THAT if any of
such insurances are also effected in the name of any
other person (other than the Borrower, the Agent, the
Hermes Agent, the Trustee and/or the Lenders) such
person shall if so required by the Agent execute a
first priority assignment of its interest in such
insurances in favour of the Trustee in similar terms
mutatis mutandis to the Insurance Assignment;
10.21.3 to agree that the Hermes Agent shall take out
mortgagee interest insurance on such conditions as
the Hermes Agent may reasonably require and mortgagee
interest insurance for pollution risks as from time
to time agreed each for an amount in Dollars of one
hundred and ten per cent (110%) of the aggregate of
the amounts of the Dollar Loan and the Dollar
equivalent of the Euro Loan (determined at HSBC Bank
plc's spot rate for conversion of Dollars to Euro at
10.00 a.m. London time ten (10) days prior to the
Delivery Date or any renewal date), the Borrower
having no interest or entitlement in respect of such
policies; the Borrower shall upon demand of the
Hermes Agent reimburse the Hermes Agent for the costs
of effecting and/or maintaining any such insurance(s)
and the Hermes Agent hereby undertakes to use its
reasonable endeavours to match the premium level that
the Borrower would have paid if the Borrower itself
had arranged such cover on such conditions (as
demonstrated to the reasonable satisfaction of the
Hermes Agent);
69
10.21.4 if the Vessel shall trade in the United States of
America and/or the Exclusive Economic Zone of the
United States of America (the "EEZ") as such term is
defined in the US Oil Pollution Act 1990 ("OPA"), to
comply strictly with the requirements of OPA and any
similar legislation which may from time to time be
enacted in any jurisdiction in which the Vessel
presently trades or may or will trade at any time
during the existence of this Agreement and in
particular before such trade is commenced and during
the entire period during which such trade is carried
on:
(a) to pay any additional premiums required to
maintain protection and indemnity cover for
oil pollution up to the limit available to
it for the Vessel in the market;
(b) to make all such quarterly or other voyage
declarations as may from time to time be
required by the Vessel's protection and
indemnity association and to comply with all
obligations in order to maintain such cover,
and promptly to deliver to the Agent copies
of such declarations;
(c) to submit the Vessel to such additional
periodic, classification, structural or
other surveys which may be required by the
Vessel's protection and indemnity insurers
to maintain cover for such trade and
promptly to deliver to the Agent copies of
reports made in respect of such surveys;
(d) to implement any recommendations contained
in the reports issued following the surveys
referred to in Clause 10.21.4(c) within the
time limit specified therein and to provide
evidence satisfactory to the Agent that the
protection and indemnity insurers are
satisfied that this has been done;
(e) in particular strictly to comply with the
requirements of any applicable law,
convention, regulation, proclamation or
order with regard to financial
responsibility for liabilities imposed on
the Borrower or the Vessel with respect to
pollution by any state or nation or
political subdivision thereof, including but
not limited to
70
OPA, and to provide the Agent on demand with
such information or evidence as it may
reasonably require of such compliance;
(f) to procure that the protection and indemnity
insurances do not contain a clause excluding
the Vessel from trading in waters of the
United States of America and the EEZ or any
other provision analogous thereto and to
provide the Agent with evidence that this is
so; and
(g) strictly to comply with any operational or
structural regulations issued from time to
time by any relevant authorities under OPA
so that at all times the Vessel falls within
the provisions which limit strict liability
under OPA for oil pollution;
10.21.5 to give notice forthwith of any assignment of its
interest in the Insurances to the relevant brokers,
insurance companies, underwriters and/or associations
in the form approved by the Agent;
10.21.6 to execute and deliver all such documents and do all
such things as may be necessary to confer upon the
Trustee legal title to the Insurances in respect of
the Vessel and to procure that the interest of the
Trustee is at all times filed with all slips, cover
notes, policies and certificates of entry and to
procure (a) that a loss payable clause in the form
approved by the Agent shall be filed with all the
hull, machinery and equipment and war risks policies
in respect of the Vessel and (b) that a loss payable
clause in the form approved by the Agent shall be
endorsed upon the protection and indemnity
certificates of entry in respect of the Vessel;
10.21.7 to procure that each of the relevant brokers and
associations furnishes the Agent with a letter of
undertaking in such form as may be required by the
Agent and waives any lien for premiums or calls
except in relation to premiums or calls attributable
to the Vessel;
10.21.8 punctually to pay all premiums, calls, contributions
or other sums payable in respect of the Insurances on
the Vessel and to produce all relevant receipts when
so required by the Agent;
71
10.21.9 to renew each of the Insurances on the Vessel at
least ten (10) days before the expiry thereof and to
give immediate notice to the Agent of such renewal
and to procure that the relevant brokers or
associations shall promptly confirm in writing to the
Agent that such renewal is effected it being
understood by the Borrower that any failure to renew
the Insurances on the Vessel at least ten (10) days
before the expiry thereof or to give or procure the
relevant notices of such renewal shall constitute an
Event of Default;
10.21.10 to arrange for the execution of such guarantees as
may from time to time be required by any protection
and indemnity and/or war risks association;
10.21.11 to furnish the Agent from time to time on request
with full information about all Insurances maintained
on the Vessel and the names of the offices,
companies, underwriters, associations or clubs with
which such Insurances are placed;
10.21.12 not to agree to any variation in the terms of any of
the Insurances on the Vessel without the prior
approval of the Agent nor to do any act or
voluntarily suffer or permit any act to be done
whereby any Insurances shall or may be rendered
invalid, void, voidable, suspended, defeated or
unenforceable and not to suffer or permit the Vessel
to engage in any voyage nor to carry any cargo not
permitted under any of the Insurances without first
obtaining the consent of the insurers or reinsurers
concerned and complying with such requirements as to
payment of extra premiums or otherwise as the
insurers or reinsurers may impose;
10.21.13 not without the prior written consent of the Agent to
settle, compromise or abandon any claim in respect of
any of the Insurances on the Vessel other than a
claim of less than five million Dollars
(USD5,000,000) or the equivalent in any other
currency and not being a claim arising out of a Total
Loss;
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10.21.14 promptly to furnish the Agent with full information
regarding any casualties or other accidents or damage
to the Vessel involving an amount in excess of five
million Dollars (USD5,000,000);
10.21.15 to apply or ensure the appliance of all such sums
receivable in respect of the Insurances on the Vessel
for the purpose of making good the loss and fully
repairing all damage in respect whereof the insurance
monies shall have been received;
10.21.16 that in the event of it making default in insuring
and keeping insured the Vessel as hereinbefore
provided then the Agent may (but shall not be bound
to) insure the Vessel or enter the Vessel in such
manner and to such extent as the Agent in its
discretion thinks fit and in such case all the cost
of effecting and maintaining such insurance together
with interest thereon at the Interest Rate shall be
paid on demand by the Borrower to the Agent; and
10.21.17 to agree that the Agent shall be entitled from time
to time (but at intervals no more frequently than
annually at the Borrower's expense except in the case
that the First Drawdown Date and any renewal date of
the Insurances to be assigned to the Trustee pursuant
to the Construction Risks Insurance Assignment or the
Delivery Date and any renewal of the Insurances to be
assigned to the Trustee pursuant to the Insurance
Assignment fall within one (1) year of each other) to
instruct independent reputable insurance advisers for
the purpose of obtaining any advice or information
regarding any matter concerning the Insurances which
the Agent shall at its sole discretion deem
necessary, it being hereby specifically agreed that
it shall reimburse the Agent on demand for all
reasonable costs and expenses incurred by the Agent
in connection with the instruction of such advisers
as aforesaid.
10.22 OPERATION AND MAINTENANCE OF THE VESSEL
From the Delivery Date until the end of the Security Period at
its own expense the Borrower will:
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10.22.1 keep the Vessel in a good and efficient state of
repair so as to maintain it to the highest
classification available for the Vessel of its age
and type free of all recommendations and
qualifications with Det Norske Veritas and American
Bureau of Shipping. On the Delivery Date and annually
thereafter, it will furnish to the Agent a statement
by such classification society that such
classification is maintained. It will comply with all
recommendations, regulations and requirements
(statutory or otherwise) from time to time applicable
to the Vessel and shall have on board as and when
required thereby valid certificates showing
compliance therewith and shall procure that all
repairs to or replacements of any damaged, worn or
lost parts or equipment are carried out (both as
regards workmanship and quality of materials) so as
not to diminish the value or class of the Vessel. It
will not make any substantial modifications or
alterations to the Vessel or any part thereof without
the prior consent of the Agent;
10.22.2 submit the Vessel to continuous survey in respect of
its machinery and hull and such other surveys as may
be required for classification purposes and, if so
required by the Agent, supply to the Agent copies in
English of the survey reports;
10.22.3 permit surveyors or agents appointed by the Agent to
board the Vessel at all reasonable times to inspect
its condition or satisfy themselves as to repairs
proposed or already carried out and afford all proper
facilities for such inspections;
10.22.4 comply, or procure that the Manager will comply, with
the ISM Code or any replacement of the ISM Code and
in particular, without prejudice to the generality of
the foregoing, as and when required to do so by the
ISM Code and at all times thereafter:
(a) hold, or procure that the Manager holds, a
valid Document of Compliance duly issued to
the Borrower or the Manager (as the case may
be) pursuant to the ISM Code and a valid
Safety Management Certificate duly issued to
the Vessel pursuant to the ISM Code;
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(b) provide the Agent with copies of any such
Document of Compliance and Safety Management
Certificate as soon as the same are issued;
and
(c) keep, or procure that there is kept, on
board the Vessel a copy of any such Document
of Compliance and the original of any such
Safety Management Certificate;
10.22.5 comply, or procure that the Manager will comply, with
the ISPS Code or any replacement of the ISPS Code and
in particular, without prejudice to the generality of
the foregoing, as and when required to do so by the
ISPS Code and at all times thereafter:
(a) keep, or procure that there is kept, on
board the Vessel the original of the
International Ship Security Certificate; and
(b) keep, or procure that there is kept, on
board the Vessel a copy of the ship security
plan prepared pursuant to the ISPS Code;
10.22.6 not employ the Vessel or permit its employment in any
trade or business which is forbidden by any
applicable law or is otherwise illicit or in carrying
illicit or prohibited goods or in any manner
whatsoever which may render it liable to condemnation
in a prize court or to destruction, seizure or
confiscation or that may expose the Vessel to
penalties. In the event of hostilities in any part of
the world (whether war be declared or not) it will
not employ the Vessel or permit its employment in
carrying any contraband goods;
10.22.7 promptly provide the Agent with (a) all information
which the Agent may reasonably require regarding the
Vessel, its employment, earnings, position and
engagements (b) particulars of all towages and
salvages and (c) copies of all charters and other
contracts for its employment and otherwise concerning
it;
10.22.8 give notice to the Agent promptly and in reasonable
detail upon the Borrower or any other Obligor
becoming aware of:
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(a) accidents to the Vessel involving repairs
the cost of which will or is likely to
exceed five million Dollars (USD5,000,000);
(b) the Vessel becoming or being likely to
become a Total Loss or a Compulsory
Acquisition;
(c) any recommendation or requirement made by
any insurer or classification society or by
any competent authority which is not
complied with within any time limit relating
thereto;
(d) any writ or claim served against or any
arrest of the Vessel or the exercise of any
lien or purported lien on the Vessel, its
Earnings or Insurances;
(e) the occurrence of any Possible Event of
Default and/or Event of Default;
(f) the Vessel ceasing to be registered under
the flag of the United States of America or
anything which is done or not done whereby
such registration may be imperilled;
(g) it becoming impossible or unlawful for it to
fulfil any of its obligations under the
Security Documents; and
(h) anything done or permitted or not done in
respect of the Vessel by any person which is
likely to imperil the security created by
the Security Documents;
10.22.9 promptly pay and discharge all debts, damages and
liabilities, taxes, assessments, charges, fines,
penalties, tolls, dues and other outgoings in respect
of the Vessel and keep proper books of account in
respect thereof PROVIDED ALWAYS THAT the Borrower
shall not be obliged to compromise any debts, damages
and liabilities as aforesaid which are being
contested in good faith subject always that full
details of any such contested debt, damage or
liability which, either individually or in aggregate
exceeds five million Dollars (USD5,000,000) shall
forthwith be provided to the Agent. As and when the
Agent may so require the Borrower will make such
books available for inspection on behalf of the
76
Agent and provide evidence satisfactory to the Agent
that the wages and allotments and the insurance and
pension contributions of the master and crew are
being regularly paid, that all deductions of crew's
wages in respect of any tax liability are being
properly accounted for and that the master has no
claim for disbursements other than those incurred in
the ordinary course of trading on the voyage then in
progress or completed prior to such inspection;
10.22.10 maintain the type of the Vessel as at the Delivery
Date and not put the Vessel into the possession of
any person without the prior consent of the Agent for
the purpose of work being done on it in an amount
exceeding or likely to exceed five million Dollars
(USD5,000,000) unless such person shall first have
given to the Agent a written undertaking addressed to
the Agent in terms satisfactory to the Agent agreeing
not to exercise a lien on the Vessel or its Earnings
for the cost of such work or for any other reason;
10.22.11 promptly pay and discharge all liabilities which have
given rise, or may give rise, to liens or claims
enforceable against the Vessel under the laws of all
countries to whose jurisdiction the Vessel may from
time to time be subject and in particular the
Borrower hereby agrees to indemnify and hold the
Lenders, the Agent, the Hermes Agent and the Trustee,
their successors, assigns, directors, officers,
shareholders, employees and agents harmless from and
against any and all claims, losses, liabilities,
damages, expenses (including attorneys, fees and
expenses and consultant fees) and injuries of any
kind whatsoever asserted against the Lenders, the
Agent, the Hermes Agent or the Trustee, with respect
to or as a direct result of the presence, escape,
seepage, spillage, release, leaking, discharge or
migration from the Vessel or other properties owned
or operated by the Borrower of any hazardous
substance, including without limitation, any claims
asserted or arising under any applicable
environmental, health and safety laws, codes and
ordinances, and all rules and regulations promulgated
thereunder of all Governmental Agencies, regardless
of whether or not caused by or within the control of
the Borrower subject to the following:
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(a) it is the parties' understanding that the
Lenders, the Agent, the Hermes Agent and the
Trustee do not now, have never and do not
intend in the future to exercise any
operational control or maintenance over the
Vessel or any other properties and
operations owned or operated by the
Borrower, nor in the past, presently, or
intend in the future to, maintain an
ownership interest in the Vessel or any
other properties owned or operated by the
Borrower except as may arise upon
enforcement of the Lenders' rights under the
Post Delivery Mortgage;
(b) the indemnity and hold harmless contained in
this Clause 10.22.11 shall not extend to the
Lenders, the Agent, the Hermes Agent and the
Trustee in their capacity as an equity
investor in the Borrower or as an owner of
any property or interest as to which the
Borrower is also owner but only to their
capacity as lenders, holders of security
interests or beneficiaries of security
interests; and
(c) unless and until an Event of Default shall
have occurred and without prejudice to the
right of each Lender to be indemnified
pursuant to this Clause 10.22.11:
(i) each Lender will, if it is
reasonably practicable to do so,
notify the Borrower upon receiving
a claim in respect of which the
relevant Lender is or may become
entitled to an indemnity under this
Clause 10.22.11;
(ii) subject to the prior written
approval of the relevant Lender
which the Lender shall have the
right to withhold, the Borrower
will be entitled to take, in the
name of the relevant Lender, such
action as the Borrower may see fit
to avoid, dispute, resist, appeal,
compromise or defend any such
claims, losses, liabilities,
damages, expenses and injuries as
are referred to above in this
Clause 10.22.11 or to recover the
same from any third party, subject
to the Borrower first ensuring that
the relevant Lender is secured
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to its reasonable satisfaction
against all expenses thereby
incurred or to be incurred; and
(iii) the relevant Lender will, to the
extent that it is reasonably
practicable to do so, seek the
approval of the Borrower (such
approval not to be unreasonably
withheld or delayed) before making
any admission of liability,
agreement or compromise with a
third party, or any payment to a
third party, in respect of such
claims, losses, liabilities,
damages, expenses and injuries as
are referred to above in this
Clause 10.22.11 and, to the extent
that the Borrower is entitled to
take action in accordance with
sub-clause (ii) above and subject
to the Borrower first ensuring that
the relevant Lender is secured to
its reasonable satisfaction against
all expenses thereby incurred or to
be incurred, the relevant Lender
will provide such information,
assistance and other co-operation
as the Borrower may reasonably
request in connection with such
action,
PROVIDED ALWAYS THAT the Borrower shall not be
obliged to compromise any liabilities as aforesaid
which are being contested in good faith subject
always that full details of any such contested
liabilities which, either individually or in
aggregate, exceed five million Dollars (USD5,000,000)
shall be forthwith provided to the Agent. If the
Vessel is arrested or detained for any reason it will
procure its immediate release by providing bail or
taking such other steps as the circumstances may
require;
10.22.12 give to the Agent at such times as it may from time
to time require a certificate, duly signed on its
behalf as to the amount of any debts, damages and
liabilities relating to the Vessel and, if so
required by the Agent, forthwith discharge such
debts, damages and liabilities to the Agent's
satisfaction; and
79
10.22.13 maintain the registration of the Vessel under and fly
the flag of the United States of America and not do
or permit anything to be done whereby such
registration may be forfeited or imperilled.
10.23 HERMES COVER
The Lenders have claims arising from this Agreement guaranteed
by the Federal Republic of Germany (represented by Hermes) by
way of the Hermes Cover. The unrestricted existence of the
Hermes Cover is a pre-requisite to drawdown of any Portion or
part thereof as referred to in Clause 2.3.3 and to the
maintenance of the Loan in accordance with the terms of this
Agreement after drawdown.
The terms and conditions of the Hermes Cover are incorporated
herein and in so far as they impose terms, conditions and/or
obligations on the Trustee and/or the Agent and/or the Hermes
Agent and/or the Lenders in relation to the Borrower or any
other Obligor then such terms, conditions and obligations are
binding on the parties hereto and further in the event of any
conflict between the terms of the Hermes Cover and the terms
hereof the terms of the Hermes Cover shall be paramount and
prevail and any breach of those terms as applied to the
Borrower or any other Obligor shall be deemed to be an Event
of Default. For the avoidance of doubt, the Borrower has no
interest or entitlement in the proceeds of the Hermes Cover.
10.24 DIVIDENDS
Subject to the provisions of clause 11.3 of the Guarantee, the
Borrower will procure that any dividends or other
distributions and interest paid or payable in connection
therewith received by the Shareholder will be paid to Arrasas
and then on to the Guarantor by way of dividend in each case
promptly on receipt.
11 DEFAULT
11.1 EVENTS OF DEFAULT
Each of the events set out below is an Event of Default:
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11.1.1 NON-PAYMENT
The Borrower or any other Obligor does not pay on the
due date any amount of principal or interest of the
Loan (provided however that if any such amount is not
paid when due solely by reason of some error or
omission on the part of the bank or banks through
whom the relevant funds are being transmitted no
Event of Default shall occur for the purposes of this
Clause 11.1.1 until the expiry of three (3) Business
Days following the date on which such payment is
due), or within three (3) Business Days of the due
date any other amount, payable by it under any
Security Document to which it may at any time be a
party, at the place and in the currency in which it
is expressed to be payable.
11.1.2 BREACH OF OTHER OBLIGATIONS
(a) Any Obligor or the Builder fails to comply
with any other material provision of any
Security Document or there is any other
material breach in the sole opinion of the
Agent of any of the Transaction Documents
and such failure (if in the opinion of the
Agent in its sole discretion it is capable
of remedy) continues unremedied for a period
of twenty one (21) days from the date of its
occurrence and in any such case as aforesaid
the Agent in its sole discretion considers
that such failure is or could reasonably be
expected to become materially prejudicial to
the interests, rights or position of the
Lenders; or
(b) If there is a repudiation or termination of
any Transaction Document or if any of the
parties thereto becomes entitled to
terminate or repudiate any of them and
evidences an intention so to do.
11.1.3 MISREPRESENTATION
Any representation, warranty or statement made or
repeated in, or in connection with, any Transaction
Document or in any accounts, certificate, statement
or opinion delivered by or on behalf of any Obligor
thereunder or in connection therewith is materially
incorrect when made
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or would, if repeated at any time hereafter by
reference to the facts subsisting at such time, no
longer be materially correct.
11.1.4 CROSS DEFAULT
(a) Any event of default occurs under any
financial contract or financial document
relating to any Financial Indebtedness of
any member of the NCLC Group;
(b) Any such Financial Indebtedness or any sum
payable in respect thereof is not paid when
due (after the expiry of any applicable
grace period(s)) whether by acceleration or
otherwise;
(c) Any Encumbrance over any assets of any
member of the NCLC Group becomes
enforceable;
(d) Any other Financial Indebtedness of any
member of the NCLC Group is not paid when
due or is or becomes capable of being
declared due prematurely by reason of
default or any security for the same becomes
enforceable by reason of default;
PROVIDED THAT:
(i) No Event of Default will arise if the
relevant Financial Indebtedness is not
accelerated or, if it is accelerated but, in
aggregate, the Financial Indebtedness is
less than five million Dollars
(USD5,000,000); and
(ii) Financial Indebtedness being contested by
the Borrower in good faith will be
disregarded provided first that full details
of the dispute shall be submitted to the
Agent forthwith upon its occurrence and
second if the dispute remains unresolved for
a period of one hundred and fifty (150) days
this Clause 11.1.4(ii) shall not apply to
that Financial Indebtedness.
11.1.5 WINDING-UP
Any order is made or an effective resolution passed
or other action taken for the suspension of payments
or reorganisation, dissolution, termination
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of existence, liquidation, winding-up or bankruptcy
of any member of the NCLC Group.
11.1.6 MORATORIUM OR ARRANGEMENT WITH CREDITORS
A moratorium in respect of all or any debts of any
member of the NCLC Group or a composition or an
arrangement with creditors of any member of the NCLC
Group or any similar proceeding or arrangement by
which the assets of any member of the NCLC Group are
submitted to the control of its creditors is applied
for, ordered or declared or any member of the NCLC
Group commences negotiations with any one or more of
its creditors with a view to the general readjustment
or rescheduling of all or a significant part of its
Financial Indebtedness.
11.1.7 APPOINTMENT OF LIQUIDATORS ETC.
A liquidator, trustee, administrator, receiver,
administrative receiver, manager or similar officer
is appointed in respect of any member of the NCLC
Group or in respect of all or any substantial part of
the assets of any member of the NCLC Group and in any
such case such appointment is not withdrawn within
thirty (30) days (the "GRACE PERIOD") unless the
Agent considers in its sole discretion that the
interest of the Lenders might reasonably be expected
to be adversely affected in which event the Grace
Period shall not apply.
11.1.8 INSOLVENCY
Any member of the NCLC Group becomes or is declared
insolvent or is unable, or admits in writing its
inability, to pay its debts as they fall due or
becomes insolvent within the terms of any applicable
law.
11.1.9 LEGAL PROCESS
Any distress, execution, attachment or other process
affects the whole or any substantial part of the
assets of any member of the NCLC Group and remains
undischarged for a period of twenty one (21) days
PROVIDED THAT no Event of Default shall be deemed to
have occurred unless the distress, execution,
attachment or other process adversely affects any
83
Obligor's ability to meet any of its material
obligations under this Agreement or the other
Security Documents (the determination of which shall
be in the Agent's sole discretion).
11.1.10 ANALOGOUS EVENTS
Anything analogous to or having a substantially
similar effect to any of the events specified in
Clauses 11.1.5 to 11.1.9 shall occur under the laws
of any applicable jurisdiction.
11.1.11 CESSATION OF BUSINESS
Any member of the NCLC Group ceases to carry on all
or a substantial part of its business.
11.1.12 REVOCATION OF CONSENTS
Any authorisation, approval, consent, licence,
exemption, filing, registration or notarisation or
other requirement necessary to enable any Obligor to
comply with any of its obligations under any of the
Transaction Documents is materially adversely
modified, revoked or withheld or does not remain in
full force and effect and within ninety (90) days of
the date of its occurrence such event is not remedied
to the satisfaction of the Agent and the Agent
considers in its sole discretion that such failure is
or might be expected to become materially prejudicial
to the interests, rights or position of the Lenders
PROVIDED THAT the Borrower shall not be entitled to
the aforesaid ninety (90) day period if the
modification, revocation or withholding of the
authorisation, approval or consent is due to an act
or omission of any Obligor and the Agent is satisfied
in its sole discretion that the Lenders' interests
might reasonably be expected to be materially
adversely affected.
11.1.13 UNLAWFULNESS
At any time it is unlawful or impossible for any
Obligor, the Builder or Hermes to perform any of its
material (to the Lenders or any of them and/or the
Agent and/or the Hermes Agent) obligations under any
Security Document to which it is a party or it is
unlawful or impossible
84
for the Agent, the Trustee or any Lender to exercise
any of its rights under any of the Security Documents
PROVIDED THAT no Event of Default shall be deemed to
have occurred (except where the unlawfulness or
impossibility adversely affects any Obligor's or the
Builder's payment obligations under this Agreement
and the other Security Documents or Hermes' payment
obligations under the Hermes Cover (the determination
of which shall be in the Agent's sole discretion) in
which case the following provisions of this Clause
11.1.13 shall not apply) where the unlawfulness or
impossibility preventing any Obligor, the Builder or
Hermes from performing its obligations (other than
its payment obligations under this Agreement and the
other Security Documents) is cured within a period of
twenty one (21) days of the occurrence of the event
giving rise to the unlawfulness or impossibility and
the relevant Obligor, the Builder or Hermes within
the aforesaid period, performs its obligation(s) and
PROVIDED FURTHER THAT no Event of Default shall be
deemed to have occurred where the Agent, the Trustee
and/or any relevant Lender was aware of the default
and could, in its sole discretion, mitigate the
consequences of the unlawfulness or impossibility in
the manner described in Clause 4.3.2. The costs of
mitigation shall be determined in accordance with
Clause 4.3.2.
11.1.14 INSURANCES
The Borrower fails to insure the Vessel in the manner
specified in Clause 10.21 or fails to renew the
Insurances at least ten (10) days prior to the date
of expiry thereof and produce prompt confirmation of
such renewal to the Agent.
11.1.15 TOTAL LOSS
If the Vessel shall become a Total Loss and the
proceeds of the Insurances in respect thereof shall
not have been received by the Agent within one
hundred and fifty (150) days plus three (3) business
days in Frankfurt, New York and Singapore after the
date of the event giving rise to such Total Loss.
85
11.1.16 DISPOSALS
If the Borrower or any other member of the NCLC Group
or the Builder (in respect of the property assigned
to the Trustee pursuant to the Construction Risks
Insurance Assignment only) shall have concealed,
removed, or permitted to be concealed or removed, any
part of its property, with intent to hinder, delay or
defraud its creditors or any of them, or made or
suffered a transfer of any of its property (in the
case of the Builder, limited to the aforesaid
property) which may be fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or
shall have made any transfer of its property (in the
case of the Builder, limited to the aforesaid
property) to or for the benefit of a creditor with
the intention of preferring such creditor over any
other creditor.
11.1.17 PREJUDICE TO SECURITY
Anything is done or suffered or omitted to be done by
any Obligor or the Builder which in the reasonable
opinion of the Agent would or might be expected to
imperil the security created by any of the Security
Documents.
11.1.18 MATERIAL ADVERSE CHANGE
Any material adverse change in the business, assets
or financial condition of any Obligor or the Builder
occurs which in the reasonable opinion of the Agent
would or might reasonably be expected to affect the
ability of that Obligor or the Builder duly to
perform any of its material obligations under any
Security Document to which it may at any time be a
party. For the purposes of this Clause 11.1.18 and
without prejudice to the generality of the expression
"MATERIAL OBLIGATIONS" any payment obligations of any
Obligor or the Builder shall be deemed material.
11.1.19 GOVERNMENTAL INTERVENTION
The authority of any member of the NCLC Group or the
Builder in the conduct of its business is wholly or
substantially curtailed by any seizure or
intervention by or on behalf of any authority and
within ninety (90) days of the date of its occurrence
any such seizure or intervention is not
86
relinquished or withdrawn and the Agent reasonably
considers that the relevant occurrence is or might be
expected to become materially prejudicial to the
interests, rights or position of the Lenders PROVIDED
THAT the Borrower shall not be entitled to the
aforesaid ninety (90) day period if the seizure or
intervention executed by any authority is due to an
act or omission of any member of the NCLC Group or
the Builder and the Agent is satisfied, in its sole
discretion, that the Lenders' interest might
reasonably be expected to be materially adversely
affected.
11.1.20 THE BUILDER
Any of the events specified in Clauses 11.1.5 to
11.1.12 of this Clause shall occur in respect of the
Builder at any time prior to the Delivery Date.
11.1.21 THE VESSEL
The Vessel has not been delivered to the Borrower by
the Builder pursuant to the Building Contract by the
Termination Date.
11.2 ACCELERATION
11.2.1 On the occurrence of an Event of Default or a
Possible Event of Default and at any time thereafter
whilst such event shall be continuing the Agent may
if the Facility has not yet been drawn down, by
notice to the Borrower cancel the obligations of the
Lenders under this Agreement.
11.2.2 On the occurrence of an Event of Default and at any
time thereafter whilst such event shall be
continuing, if any of the Facility has been drawn
down:
(a) the Agent may by notice to the Borrower
declare the whole or any part of the Loan
due and repayable in accordance with the
terms of such notice whereupon the same
shall become due and repayable accordingly
together with all interest accrued thereon
and all other amounts payable hereunder and
under any of the other Security Documents
and any undrawn Portion or any part thereof
shall be cancelled; and/or
87
(b) the Trustee, the Agent, the Hermes Agent and
the Lenders may from time to time exercise
all or any of its or their rights under any
of the Security Documents in such order and
in such manner as it or they shall deem
appropriate; and/or
(c) the Trustee may at the discretion of the
Agent terminate or continue with the
Supervision Agreement, the Management
Agreement and/or the Sub-Agency Agreement.
11.3 DEFAULT INDEMNITY
The Borrower shall on demand indemnify the Agent and the
Lenders, without prejudice to any of their other rights under
this Agreement and the other Security Documents, against any
loss or expense which the Agent shall certify as sustained or
incurred by any of them as a consequence of:
11.3.1 any default in payment by the Borrower of any sum
under this Agreement or any of the other Security
Documents when due, including, without limitation,
any liability incurred by the Trustee, the Agent, the
Lenders and the Hermes Agent by reason of any delay
or failure of the Borrower to pay any such sums;
11.3.2 any break in funding (including without limitation
warehousing and other related costs) due to the
occurrence of any Event of Default or Possible Event
of Default;
11.3.3 any prepayment of the Loan or part thereof being made
at any time for any reason; and/or
11.3.4 a Portion or any part thereof not being drawn for any
reason (excluding any default by the Agent or any
Lender) after a Drawdown Notice has been given,
including, in any such case, but not limited to, any loss or
expense sustained or incurred in maintaining or funding the
Loan or in liquidating or re-employing deposits from third
parties acquired to effect or maintain the Loan, any loss
(including the cost of breaking deposits or re-employing funds
(including warehousing and other related costs)) or any losses
under any Interest Exchange
88
Arrangement and/or any swap agreements or other interest rate
management products entered into by the Lenders for the
purpose of this transaction.
11.4 SET-OFF
Following the occurrence of any Event of Default and for so
long as the same is continuing, the Borrower irrevocably
authorises the Agent and the Lenders to apply any credit
balance to which the Borrower is entitled upon any account of
the Borrower with any branch of any of the Agent and the
Lenders in or towards satisfaction of any sum due to the Agent
or any Lender hereunder but unpaid, and to combine any
accounts of the Borrower for this purpose. If such set-off
requires a credit balance in a currency other than Dollars
and/or Euro to be transferred to an account maintained in
connection herewith the transfer shall be effected by
crediting to the account in question the amount of Dollars
and/or Euro (as the case may be) which the Agent or the Lender
(as the case may be) could obtain by exchanging such currency
for Dollars or Euro (as the case may be) at the rate of
exchange at which its Office would, at the opening of business
on the date on which the combination is effected, have sold
the currency of that credit balance for Dollars or Euro (as
the case may be) for immediate delivery.
12 APPLICATION OF FUNDS
12.1 TOTAL LOSS PROCEEDS/PROCEEDS OF SALE/EVENT OF DEFAULT MONIES
In the event of the Vessel becoming a Total Loss or if the
Vessel is sold or if an Event of Default has occurred then all
Total Loss proceeds or proceeds of sale of the Vessel or any
monies received by the Trustee, the Agent, the Hermes Agent or
any Lender under or pursuant to the Security Documents (other
than the Hermes Cover) shall be held by the Agent and applied
in the following manner and order:
FIRSTLY to the payment of any amount of the Hermes Premium
which has been invoiced but remains unpaid and all
fees, expenses and charges (including brokers'
commissions and any costs incurred in breaking any
funding, the expenses of any sale, the expenses of
retaining any attorney, solicitors' fees, court
costs and any other expenses or advances made or
incurred by the Trustee, the Agent, the Hermes
Agent or any Lender in the protection of the
Trustee's,
89
the Agent's, the Hermes Agent's and that Lender's
rights or the pursuance of its or their remedies
hereunder and under the other Security Documents or
to any payments whether voluntary or not which the
Agent considers advisable to protect its, the
Trustee's, the Hermes Agent's or the Lenders'
security and to provide adequate indemnity against
liens claiming priority over or equality with the
lien of the Security Documents or any other
Encumbrances but excluding any costs incurred in
breaking an Interest Exchange Arrangement or any
swap agreements or other interest rate management
products entered into by the Lenders for the
purpose of this transaction including but without
limitation warehousing and other related costs);
SECONDLY in or towards payment in such order as the Lenders
may require of any accrued (but unpaid) fees and
interest thereon to which the Lenders and/or the
Agent are entitled hereunder and/or under the other
Security Documents in connection with the Loan;
THIRDLY in or towards satisfaction of all interest accrued
on the Loan;
FOURTHLY in retention by the Agent in its discretion in a
suspense or impersonal interest bearing security
realised account of such sum as it considers
appropriate by way of security for the Outstanding
Indebtedness or for any actual or contingent
liability of the Agent or the Lenders or any of
them in connection with the transactions herein
contemplated;
FIFTHLY in or towards payment of the Instalments (whether
or not then due and payable) in reverse order of
maturity date;
SIXTHLY in or towards satisfaction of any other amounts due
from the Borrower to the Agent or the Lenders under
the Security Documents using in the discretion of
the Agent the same order of application as Firstly
to Fifthly;
SEVENTHLY in retention of such other sum or sums as the Agent
may require as security for any further monies
which may reasonably be
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expected to become due and payable to the Trustee
and/or the Agent and/or the Lenders and/or the
Hermes Agent under this Agreement or any of the
other Security Documents and which the assigned
Earnings may be insufficient to satisfy;
EIGHTHLY any loss (including the cost of breaking deposits
or re-employing funds (including warehousing and
other related costs)) or any losses under any
Interest Exchange Arrangement and/or any swap
agreements or other interest rate management
products entered into by the Lenders for the
purpose of this transaction; and
NINTHLY the balance, if any, in payment to the Borrower or
whomsoever shall then be entitled thereto.
In the event of the proceeds being insufficient to pay the
amounts referred to above the Agent shall be entitled to
collect the balance from the Borrower.
12.2 GENERAL FUNDS
Any other monies received by or in the possession of the
Trustee, the Agent, any Lender or the Hermes Agent under or
pursuant to the Security Documents (other than the Hermes
Cover) which are expressed hereunder and/or under the Security
Documents to be distributed in accordance with the provisions
of this Clause or where no express provisions are made for
disposal shall be applied in the discretion of the Agent as
follows:
FIRSTLY in or towards payment of all fees, costs and
expenses (excluding any costs (including without
limitation any warehousing and other related costs)
incurred in breaking any Interest Exchange
Arrangement or any interest rate swap agreements or
other interest rate management products entered
into by the Lenders for the purposes of this
transaction) incurred by the Agent or any Lender in
connection with the Loan and which are for the time
being unpaid;
SECONDLY in or towards payment in such order as the Lenders
may require of any accrued (but unpaid) fees and
interest thereon to which the Lenders and/or the
Agent and/or the Hermes Agent are entitled
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hereunder and/or under the other Security Documents
in connection with the Loan;
THIRDLY in or towards satisfaction of all interest accrued
on the Loan;
FOURTHLY in retention by the Agent in its discretion in a
suspense or impersonal interest bearing security
realised account of such sum as it considers
appropriate by way of security for the Outstanding
Indebtedness or for any actual or contingent
liability of the Agent or the Lenders or any of
them in connection with the transactions herein
contemplated;
FIFTHLY in or towards payment of the Instalments in reverse
order of maturity date;
SIXTHLY in retention of such other sum or sums as the Agent
may require as security for any further monies
which may reasonably be expected to become due and
payable to the Agent and/or the Lenders and/or the
Hermes Agent under this Agreement or any of the
other Security Documents and which the assigned
Earnings may be insufficient to satisfy;
SEVENTHLY any loss (including the cost of breaking deposits
or re-employing funds (including warehousing and
other related costs)) or any losses under any
Interest Exchange Arrangement and/or any swap
agreements or other interest rate management
products entered into by the Lenders for the
purpose of this transaction; and
EIGHTHLY the balance (if any) shall be released to the
Borrower or to its order or whomsoever else may be
entitled thereto.
12.3 APPLICATION OF PROCEEDS OF INSURANCES
Proceeds of the Insurances for partial losses shall be applied
in accordance with the Construction Risks Insurance Assignment
or the Insurance Assignment (as the case may be) and/or the
loss payable clause(s) endorsed on the Insurances in the form
approved by the Agent and in the case of a Total Loss of the
Vessel in accordance with Clause 4.5 and Clause 12.1.
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12.4 APPLICATION OF ANY REDUCTION IN THE HERMES PREMIUM
Any amount received by the Agent or the Hermes Agent following
a reduction in the amount of the Hermes Premium shall be
applied as to eighty per cent (80%) in accordance with Clause
4.7 and the balance shall be paid to the Borrower PROVIDED
THAT neither an Event of Default nor a Possible Event of
Default has occurred and is continuing when such amount shall
be applied in accordance with Clause 12.1.
12.5 SUSPENSE ACCOUNT
Any monies received or recovered by the Trustee, the Agent,
any Lender or the Hermes Agent under or in connection with the
Security Documents and credited to any suspense or impersonal
interest bearing security realised account may be held in such
account for so long as the Agent thinks fit pending
application at the Agent's discretion in accordance with
Clause 12.1 or Clause 12.2 (as the case may be).
13 FEES
13.1 The Borrower shall enter into fees side letters with the Agent
on the date hereof and pay to the Agent such fees and on such
date(s) as shall be referred to therein.
14 EXPENSES
14.1 INITIAL EXPENSES
The Borrower shall reimburse the Agent on first demand on a
full indemnity basis for the reasonable charges and expenses
(together with value added tax or any similar tax thereon and
including without limitation the fees and expenses of legal,
insurance and other advisers and travel expenses) incurred by
the Agent in respect of the syndication, negotiation,
preparation, printing, execution and registration of this
Agreement and the other Transaction Documents and any other
documents required in connection with the implementation of
this Agreement.
14.2 ENFORCEMENT EXPENSES
The Borrower shall reimburse the Agent, the Lenders and the
Hermes Agent on demand on a full indemnity basis for all
charges and expenses (including value
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added tax or any similar tax thereon and including the fees
and expenses of legal advisers) incurred by the Agent, each of
the Lenders and the Hermes Agent in connection with the
enforcement of, or the preservation of any rights under, this
Agreement and the other Security Documents.
14.3 STAMP DUTIES
The Borrower shall pay or indemnify the Agent or the Hermes
Agent (as the case may be) on demand against any and all
stamp, registration and similar Taxes which may be payable in
any jurisdiction in connection with the entry into,
performance and enforcement of this Agreement or any of the
other Security Documents.
15 WAIVERS, REMEDIES CUMULATIVE
15.1 NO WAIVER
No failure to exercise and no delay in exercising on the part
of the Trustee, the Agent, any of the Lenders or the Hermes
Agent any right or remedy under any of the Security Documents
shall operate as a waiver thereof, nor shall any single or
partial exercise of any right or remedy preclude any other or
further exercise thereof, or the exercise of any other right
or remedy. No waiver by the Trustee, the Agent, the Hermes
Agent or any of the Lenders shall be effective unless it is in
writing.
15.2 REMEDIES CUMULATIVE
The rights and remedies of the Agent and the Lenders provided
herein are cumulative and not exclusive of any rights or
remedies provided by law.
15.3 SEVERABILITY
If any provision of this Agreement is prohibited or
unenforceable in any jurisdiction, such prohibition or
unenforceability shall not invalidate the remaining provisions
hereof or affect the validity or enforceability of such
provision in any other jurisdiction.
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15.4 TIME OF ESSENCE
Time is of the essence in respect of all of the obligations of
the Borrower under the Security Documents PROVIDED HOWEVER
THAT neither the Agent nor any of the Lenders shall be
entitled to terminate or treat this Agreement or any of the
other Security Documents as having been repudiated otherwise
than in circumstances which constitute an Event of Default.
16 COUNTERPARTS
16.1 This Agreement may be executed in any number of counterparts
and all such counterparts taken together shall be deemed to
constitute one and the same agreement.
17 ASSIGNMENT
17.1 BENEFIT OF AGREEMENT
This Agreement shall be binding upon the Borrower and its
successors and shall inure to the benefit of the Agent and
each of the Lenders and their successors and assigns.
17.2 NO TRANSFER BY THE BORROWER
The Borrower may not assign or transfer all or any of its
rights, benefits or obligations hereunder or under any of the
other Security Documents.
17.3 ASSIGNMENTS, PARTICIPATIONS AND TRANSFERS BY A LENDER
Each Lender may, subject to obtaining the prior written
approval of the Agent and the Hermes Agent, in the case of the
Agent such approval not to be unreasonably withheld or
delayed, at any time transfer or assign all of its rights and
benefits hereunder and under the Security Documents to any
other lending institution but shall, prior to such transfer or
assignment, on request by the Agent, pay a fee to the Agent of
one thousand Dollars (USD1,000) PROVIDED THAT (save in the
case of a transfer or assignment of rights and benefits to any
subsidiary or holding company of such Lender or to another
Lender) no such transfer or assignment may be made without the
prior written consent of the Borrower (which consent is not to
be unreasonably withheld or delayed). If a Lender transfers or
assigns its
95
rights and benefits hereunder as provided above, all
references in this Agreement and the other Security Documents
to that Lender shall be construed as a reference to that
Lender and/or its Transferee or assignee to the extent of
their respective interests.
Each Lender may, however, without the prior approval of the
Agent, the Hermes Agent or the Borrower and without payment of
a fee to the Agent, at any time transfer or assign all of its
rights and benefits hereunder and under the Security Documents
to Hermes or to any nominee of the Federal Republic of Germany
or for pure refinancing purposes by way of Hermes'
"Verbriefungsgarantie" PROVIDED THAT in the latter case the
assigning Lender shall not be released from its obligations
hereunder or under the other Security Documents by any such
transfer or assignment.
17.4 EFFECTIVENESS OF TRANSFER
If a Lender transfers or assigns all or any of its rights and
benefits hereunder in accordance with Clause 17.3, then,
unless and until the Transferee or assignee has agreed that it
shall be under the same obligations towards the parties to
this Agreement as it would have been under if it had been a
party hereto as a lender, the parties to this Agreement shall
not be obliged to recognise such Transferee or assignee as
having the rights against each of them which it would have had
if it had been such a party hereto.
17.5 TRANSFER OF RIGHTS AND OBLIGATIONS
If any Lender wishes to transfer all or any of its rights,
benefits and/or obligations hereunder or under the other
Security Documents as contemplated in Clause 17.3, then such
transfer may be effected by the due completion and execution
by the Lender and the relevant Transferee of a Transfer
Certificate in the form of Schedule 6. The Agent shall then
forthwith execute the Transfer Certificate on behalf of itself
and the other parties to this Agreement in accordance with the
provisions of Clause 17.8. On the later of the Transfer Date
and the fifth (5th) Business Day following the date of
delivery of the Transfer Certificate to the Agent for
execution:
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17.5.1 to the extent that in such Transfer Certificate the
Lender party thereto seeks to transfer its rights,
benefits and/or its obligations hereunder or under
the other Security Documents, the Borrower and the
relevant Lender shall each be released from further
obligations to the other hereunder and their
respective rights against each other shall be
cancelled (such rights and obligations being referred
to in this Clause 17.5 as "DISCHARGED RIGHTS,
BENEFITS AND OBLIGATIONS");
17.5.2 the Borrower and the Transferee party thereto shall
each assume obligations towards each other and/or
acquire rights against each other which differ from
such discharged rights, benefits and obligations only
insofar as the Borrower and such Transferee have
assumed and/or acquired the same in place of the
Borrower and the relevant Lender; and
17.5.3 such Transferee shall acquire the same rights and
benefits and assume the same obligations as it would
have acquired and assumed had such Transferee been an
original party hereto as a Lender with the rights,
benefits and/or obligations acquired or assumed by it
as a result of such transfer.
17.6 CONSENT AND INCREASED OBLIGATIONS OF THE BORROWER
In the event that a Lender transfers its Office or transfers
or assigns its rights and/or benefits hereunder to its
affiliate or another Lender and, at the time of such transfer
or assignment, there arises an obligation on the part of the
Borrower hereunder to pay to the relevant Lender or any other
person any amount in excess of the amount they would have been
obliged to pay but for such transfer or assignment and the
consent of the Borrower has not been obtained to such transfer
or assignment and the increased cost then, without prejudice
to any obligation of the Borrower which arises after the time
of such transfer or assignment, the Borrower shall not be
obliged to pay the amount of such excess.
17.7 DISCLOSURE OF INFORMATION
Each of the Arrangers, each of the Lenders, the Agent, the
Hermes Agent and the Trustee (in this Clause 17.7 a "BANK")
acknowledges that all information received now or in the
future from or on behalf of the Obligors under or pursuant
97
to or in connection with the Transaction Documents (other than
any information which is in the public domain other than as a
result of a breach of this Clause), is confidential
information. Any of the Banks may disclose to:
17.7.1 a potential Transferee or assignee who may otherwise
propose to enter into contractual relations with the
Bank in relation to this Agreement;
17.7.2 any person who is any of the Bank's professional
advisers or auditors;
17.7.3 its Holding Company and/or Subsidiary;
17.7.4 any person who is a party to this Agreement other
than the Borrower;
17.7.5 any banking or regulatory authority or as required by
law, regulation or legal process;
17.7.6 Hermes and/or the Federal Republic of Germany and/or
the European Union and/or any agency thereof or any
person acting or purporting to act on any of their
behalves; and/or
17.7.7 the Builder,
such information about any Obligor or the NCLC Group and the
Transaction Documents and/or copies of this Agreement, any of
the Security Documents and all records in connection therewith
as the Bank shall consider appropriate PROVIDED THAT, in the
case of Clauses 17.7.1, 17.7.2 and 17.7.3, such person has
agreed to execute a Confidentiality Undertaking and, in the
case of Clause 17.7.3, the Holding Company and/or the
Subsidiary shall also be entitled to make such disclosure to
the Bank and/or to the Holding Company and/or to the
Subsidiaries of the Bank. In the case of Clause 17.7.6, the
Borrower acknowledges and agrees that any such information may
be used by Hermes and/or the Federal Republic of Germany
and/or the European Union and/or any agency thereof or any
person acting or purporting to act on any of their behalves
for statistical purposes and/or for reports of a general
nature.
17.8 TRANSFER CERTIFICATE TO BE EXECUTED BY THE AGENT
In order to give effect to a Transfer Certificate each of the
Arrangers, the Lenders, the Hermes Agent, the Trustee and the
Borrower hereby irrevocably and
98
unconditionally appoints the Agent as its true and lawful
attorney with full power to execute on its behalf each
Transfer Certificate delivered to the Agent pursuant to Clause
17.5 without the Agent being under any obligation to take any
further instructions from, or give any prior notice to, the
Arrangers, the Lenders, the Hermes Agent, the Trustee, the
Borrower or the Guarantor before doing so and the Agent shall
so execute each such Transfer Certificate on behalf of the
Arrangers, the Lenders, the Hermes Agent, the Trustee, the
Borrower and the Guarantor forthwith upon its receipt thereof
pursuant to Clause 17.5.
17.9 NOTICE OF TRANSFER CERTIFICATES
The Agent shall promptly notify the Arrangers, the Lenders,
the Hermes Agent, the Trustee, the Transferee, the Borrower
and the Guarantor upon the execution by it of any Transfer
Certificate together with details of the amount transferred,
the Transfer Date and the parties to such transfer.
17.10 DOCUMENTATION OF TRANSFER OR ASSIGNMENT
The Borrower shall at the request of the Agent promptly
execute or promptly procure the execution of such documents
and do (or procure the doing of) all such acts and things as
may be necessary or desirable to give effect to any transfer
or assignment pursuant to this Clause 17.
17.11 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999 (THE "ACT")
A person who is not a party to this Agreement has no right
under the Act to enforce any term of this Agreement but this
does not affect any right or remedy of a third party which
exists or is available apart from the Act.
18 NOTICES
18.1 MODE OF COMMUNICATION
Except as otherwise provided herein, each notice, request,
demand or other communication or document to be given or made
hereunder shall be given in writing but unless otherwise
stated, may be made by telefax.
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18.2 ADDRESS
Any notice, demand or other communication (unless made by
telefax) to be made or delivered by the Agent to the Borrower
pursuant to this Agreement shall (unless the Borrower has by
fifteen (15) days' written notice to the Agent specified
another address) be made or delivered to the Borrower c/o 0000
Xxxxxxxxx Xxxxxx Xxxxx, Xxxxx, Xxxxxxx 00000, Xxxxxx Xxxxxx of
America (marked for the attention of Xx Xxxxxx Cooler and the
Legal Department) with a copy to the Borrower c/o Star, 25th
Floor, Wisma Genting, Xxxxx Xxxxxx Xxxxxx, 00000 Xxxxx Xxxxxx,
Xxxxxxxx (marked for the attention of Xx Xxxxxx Xxx). Any
notice, demand or other communication to be made or delivered
by the Borrower to the Agent pursuant to this Agreement shall
(unless the Agent has by fifteen (15) days' written notice to
the Borrower specified another address) be made or delivered
to the Agent at its Office, the details of which are set out
in Schedule 2. A copy of any notice to the Agent shall be
delivered to the Hermes Agent at its Office as aforesaid.
18.3 TELEFAX COMMUNICATION
Any notice, demand or other communication to be made or
delivered pursuant to this Agreement may be sent by telefax to
the relevant telephone numbers (which at the date hereof in
respect of the Borrower is x0 000 000 0000 (marked for the
attention of Xx Xxxxxx Cooler) and x0 000 000 0000 (marked for
the attention of the Legal Department) with a copy to +60 (0)3
2161 3621 (marked for the attention of Xx Xxxxxx Xxx) and in
the case of the Trustee, the Agent, the Hermes Agent or any
Lender is as recorded in Schedule 2) specified by it from time
to time for the purpose and shall be deemed to have been
received when transmission of such telefax communication has
been completed provided that if in the place of receipt the
transmission is received outside normal business hours on a
Business Day or not on a Business Day the transmission shall
be deemed to have been received at the commencement of the
next Business Day. Each such telefax communication, if made to
the Agent or any Lender by the Borrower, shall be signed by
the person or persons authorised in writing by the Borrower
and whose signature appears on the list of specimen signatures
contained in the secretary's certificate required to be
delivered by paragraph 2 of Schedule 4 and shall be expressed
to be for the attention of the department or officer whose
name
100
has been notified for the time being for that purpose by the
Agent or any Lender to the Borrower.
18.4 RECEIPT
Each such notice, demand or other communication shall be
deemed to have been made or delivered (in the case of any
letter) when delivered to its office for the time being or, if
sent by post, five (5) days after being deposited in the post
first class postage prepaid in an envelope addressed to it at
that address.
18.5 LANGUAGE
Each notice, demand or other communication made or delivered
by one (1) party to another pursuant to this Agreement or any
other Security Document shall be in the English language or
accompanied by a certified English translation. In the event
of any conflict between the translation and the original text
the translation shall prevail unless the original text is a
statutory instrument, legal process or any other document of a
similar type or a notice, demand or other communication from
Hermes or in relation to the Hermes Cover.
19 GOVERNING LAW
19.1 This Agreement shall be governed by English law.
20 WAIVER OF IMMUNITY
20.1 To the extent that the Borrower may in any jurisdiction claim
for itself or its assets immunity from suit, execution,
attachment (whether in aid of execution, before judgment or
otherwise) or other legal process in relation to this
Agreement or the other Security Documents and to the extent
that in any such jurisdiction there may be attributed to
itself or its assets such immunity (whether or not claimed)
the Borrower hereby irrevocably and unconditionally agrees
throughout the Security Period not to claim and hereby
irrevocably waives such immunity to the full extent permitted
by the laws of such jurisdiction. In respect of any legal
action or proceedings arising out of or in connection with any
of the Security Documents the Borrower hereby consents
generally as a matter of procedure in relation to the waiver
of immunity (but not so as to prejudice any defence which it
may have on the merits of the substantive issue) to the giving
of any relief or the
101
issue of any process in connection with such legal action or
proceedings including without limitation, the making,
enforcement or execution against any property whatsoever
(irrespective of its uses or intended uses) of any order or
judgment which may be made or given in such legal action or
proceedings.
21 RIGHTS OF THE AGENT AND THE LENDERS
21.1 NO DEROGATION OF RIGHTS
Any rights conferred on the Agent and the Lenders or any of
them by this Agreement or any other Security Document shall be
in addition to and not in substitution for or in derogation of
any other right which the Agent and the Lenders or any of them
might at any time have to seek from the Borrower or any other
person for payment of sums due from the Borrower or
indemnification against liabilities as a result of the
Borrower's default in payment of sums due from it under this
Agreement or any other Security Document.
21.2 ENFORCEMENT OF REMEDIES
None of the Agent or the Lenders shall be obliged before
taking steps to enforce any rights conferred on it by this
Clause or exercising any of the rights, powers and remedies
conferred on it hereby or by law:
21.2.1 to take action or obtain judgment in any court
against the Borrower or any other person from whom it
may seek payment of any sum due from the Borrower
under this Agreement or any other Security Document;
21.2.2 to make or file any claim in a bankruptcy,
winding-up, liquidation or re-organisation of the
Borrower or any other such person; or
21.2.3 to enforce or seek to enforce any other rights it may
have against the Borrower or any other such person.
22 JURISDICTION
22.1 The courts of England have exclusive jurisdiction to settle
any dispute arising out of or in connection with this
Agreement (including a dispute regarding the existence,
validity or termination of this Agreement) (a "DISPUTE"). Each
party to this Agreement agrees that the courts of England are
the most appropriate and
102
convenient courts to settle Disputes and accordingly no party
will argue to the contrary.
This Clause 22.1 is for the benefit of the Agent and the
Lenders only. As a result, no such party shall be prevented
from taking proceedings relating to a Dispute in any other
courts with jurisdiction. To the extent allowed by law, any
such party may take concurrent proceedings in any number of
jurisdictions.
22.2 The Borrower may not, without the Agent's prior written
consent, terminate the appointment of the Process Agent; if
the Process Agent resigns or its appointment ceases to be
effective, the Borrower shall within fourteen (14) days
appoint a company which has premises in London and has been
approved by the Agent to act as the Borrower's process agent
with unconditional authority to receive and acknowledge
service on behalf of the Borrower of all process or other
documents connected with proceedings in the English courts
which relate to this Agreement.
22.3 For the purpose of securing its obligations under Clause 22.2,
the Borrower irrevocably agrees that, if it for any reason
fails to appoint a process agent within the period specified
in Clause 22.2, the Agent may appoint any person (including a
company controlled by or associated with the Agent or any
Lender) to act as the Borrower's process agent in England with
the unconditional authority described in Clause 22.2.
22.4 No neglect or default by a process agent appointed or
designated under this Clause (including a failure by it to
notify the Borrower of the service of any process or to
forward any process to the Borrower) shall invalidate any
proceedings or judgment.
22.5 The Borrower appoints in the case of the courts of England the
Process Agent to receive, for and on its behalf service of
process in England of any legal proceedings with respect to
this Agreement and any other Security Document.
22.6 A judgment relating to this Agreement which is given or would
be enforced by an English court shall be conclusive and
binding on the Borrower and may be enforced without review in
any other jurisdiction.
22.7 Nothing in this Clause shall exclude or limit any right which
the Agent or a Lender may have (whether under the laws of any
country, an international
103
convention or otherwise) with regard to the bringing of proceedings,
the service of process, the recognition or enforcement of a judgment
or any similar or related matter in any jurisdiction.
22.8 In this Clause "JUDGMENT" includes order, injunction, declaration
and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Agreement to be duly
executed as a deed on the day first written above.
THE BORROWER
SIGNED SEALED and DELIVERED as a DEED )
by XXXX XXXXXX ) P.A. Xxxxxx
for and on behalf of )
SHIP VENTURES INC. )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
One, St. Paul's Churchyard
London EC4M 8SH
THE ARRANGERS
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
COMMERZBANK AKTIENGESELLSCHAFT )
Hamburg Branch )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
HSBC BANK PLC )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
104
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
KfW )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
DnB NOR BANK ASA )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
OVERSEA-CHINESE BANKING )
CORPORATION LIMITED )
Singapore Branch )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
One, St. Paul's Churchyard
London EC4M 8SH
THE LENDERS
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
COMMERZBANK AKTIENGESELLSCHAFT )
Bremen Branch )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
105
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
HSBC BANK PLC )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
KfW )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
DnB NOR BANK ASA )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
OVERSEA-CHINESE BANKING )
CORPORATION LIMITED )
Singapore Branch )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
106
THE AGENT
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
HSBC BANK PLC )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
One, St. Paul's Churchyard
London EC4M 8SH
THE HERMES AGENT
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
COMMERZBANK AKTIENGESELLSCHAFT )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
THE TRUSTEE
SIGNED SEALED and DELIVERED as a DEED )
by XXXXX XXXXX ) X. Xxxxx
for and on behalf of )
HSBC BANK PLC )
in the presence of: R Xxxxxx )
Trainee Solicitor
Xxxxxxxxxx Xxxxxxx
Xxx, Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
107
SCHEDULE 1
PARTICULARS OF ARRANGERS
INDEMNITY IN (EUROS) OR
USD EQUIVALENT OF (EUROS)
COMMERZBANK 68,836,242 (22.34%)
AKTIENGESELLSCHAFT
Global Shipping Hamburg
Ness 7-9
00000 Xxxxxxx
Xxxxxxx Xxxxxxxx of Germany
Attn: Xx Xxxxxx Xxxx/Xx Xxxxxxxxx Xxxxx
Email: xxxxxxxxxxx@xxxxxxxxxxx.xxx
HSBC BANK PLC 68,805,429 (22.33%)
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Attn: Mr Xxxx Xxxxxxxx
Email: xxxx.x.xxxxxxxx@xxxxxx.xxx
KfW 68,805,429 (22.33%)
Xxxxxxxxxxxxxxxxxxx 0-0
00000 Xxxxxxxxx xx Xxxx
Xxxxxxx Xxxxxxxx of Germany
Attn: Xx Xxxxxxxx Xxxxxxxxx
Email: xxxxxxxx.xxxxxxxxx@xxx.xx
DnB NOR BANK ASA 52,382,100 (17.00%)
Xxxxxxxx 00
XX-0000 Xxxx
Xxxxxx
Attn: Mr Xxx Flovik
Email: xxx.xxxxxx@xxxxxx.xx
108
OVERSEA-CHINESE BANKING 49,300,800 (16.00%)
CORPORATION LIMITED
Singapore Branch
00 Xxxxxx Xxxxxx #00-00
Xxxxxxxxx 000000
Attn: Ms Pearlwyn Ho/Xx Xxxxxx Xxx
Email: XxxXXXxxxxx@xxxx.xxx.xx
109
SCHEDULE 2
PARTICULARS OF AGENT, HERMES AGENT, TRUSTEE AND LENDERS
NAME AND ADDRESS
AGENT
HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Fax: x00 (0)00 0000 0000
Attn: Mr Xxxx Xxxxxxxx
Email: xxxx.x.xxxxxxxx@xxxxxx.xxx
HERMES AGENT
COMMERZBANK
AKTIENGESELLSCHAFT
Corporate Banking
Financial Engineering
Structured Export and Trade Finance
Xxxxxxxxxxx
00000 Xxxxxxxxx xx Xxxx
Xxxxxxx Xxxxxxxx of Germany
Fax: x00 00 0000 0000
Attn: Xx Xxxxx-Xxxxxx Xxxxxxxxxx
Email: xxxxxxxxxxxxx@xxxxxxxxxxx.xxx
TRUSTEE
HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Fax: x00 (0)00 0000 0000
Attn: Mr Xxxx Xxxxxxxx
Email: xxxx.x.xxxxxxxx@xxxxxx.xxx
110
NAME AND ADDRESS CONTRIBUTION
IN (EUROS) OR USD EQUIVALENT
OF (EUROS)
LENDERS
COMMERZBANK 68,836,242 (22.34%)
AKTIENGESELLSCHAFT
Bremen Branch
Xxxxxxxxxxxx 0-00
00000 Xxxxxx
Xxxxxxx Xxxxxxxx of Germany
Fax: x00 000 0000000
Attn: Mr Xxxxxxxx Xxxxxxx
Email: xxxxxxxx.xxxxxxx0@xxxxxxxxxxx.xxx
with a copy (in respect of matters not related
to interest fixing or payments) to:
COMMERZBANK
AKTIENGESELLSCHAFT
Global Shipping Hamburg
Ness 7-9
00000 Xxxxxxx
Xxxxxxx Xxxxxxxx of Germany
Fax: x00 00 0000-0000
Attn: Xx Xxxxxx Xxxx/Xx Xxxxxxxxx Xxxxx
Email: xxxxxxxxxxx@xxxxxxxxxxx.xxx
HSBC BANK PLC 68,805,429 (22.33%)
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Fax: x00 (0)00 0000 0000
Attn: Mr Xxxx Xxxxxxxx
Email: xxxx.x.xxxxxxxx@xxxxxx.xxx
KfW 68,805,429 (22.33%)
Xxxxxxxxxxxxxxxxxxx 0-0
00000 Xxxxxxxxx xx Xxxx
Xxxxxxx Xxxxxxxx of Germany
Fax: x00 00 0000 0000
Attn: Xx Xxxxxxxx Xxxxxxxxx
Email: xxxxxxxx.xxxxxxxxx@xxx.xx
111
DnB NOR BANK ASA 52,382,100 (17.00%)
Xxxxxxxx 00
XX-0000 Xxxx
Xxxxxx
Fax: x00 00 000000
Attn: Mr Xxx Flovik
Email: xxx.xxxxxx@xxxxxx.xx
OVERSEA-CHINESE BANKING 49,300,800 (16.00%)
CORPORATION LIMITED
Singapore Branch
00 Xxxxxx Xxxxxx #00-00
Xxxxxxxxx 000000
Fax: x00 0000-0000/0000 0000
Attn: Ms Pearlwyn Ho/Xx Xxxxxx Xxx
Email: XxxXXXxxxxx@xxxx.xxx.xx
112
SCHEDULE 3
NOTICE OF DRAWDOWN
CLAUSE 2.3.1
From: SHIP VENTURES INC.
Corporation Trust Center
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx
Xxxxxxxx 00000
Xxxxxx Xxxxxx of America
To: HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Attn: Mr Xxxx Xxxxxxxx
200[ ]
Dear Sirs
LOAN AGREEMENT DATED 2004 (THE "LOAN AGREEMENT")
We refer to the Loan Agreement pursuant to which you have agreed to advance to
us the Facility on the terms and conditions set out therein.
Terms and expressions defined in the Loan Agreement shall have the same
respective meanings when used in this notice.
We hereby give you notice that we wish to draw down [the Equivalent Amount of]
[[ ] Euro ((EURO)[ ]) being the amount of Tranche [ ] of Portion 1] [and] [[
] Euro ((EURO)[ ]) being Tranche [A/B/C] of Portion 2] under Clause 2.3 of the
Loan Agreement on [ ] 200[ ].
[Tranche [ ] of Portion 1 in the amount of [ ] Euro ((EURO)[ ]) is to be paid
to the Builder's Account (as defined in the schedule to the Building Contract)
at:
Commerzbank AG
Bremen Branch
Account No 0000000]
113
[Tranche A of Portion 2 in the Equivalent Amount of [ ] Euro (EUR[ ]) is to be
paid to the Borrower in reimbursement of eighty per cent (80%) of the Hermes
Premium paid to the Hermes Agent for on-payment to Hermes on the issue of the
Hermes Cover.]
[Tranche [B/C] of Portion 2 in the Equivalent Amount of [ ] Euro (EUR[ ]) is
to be paid to the Hermes Agent for on-payment to Hermes in [payment/part
payment] of the balance of the Hermes Insurance Premium.]
Tranche [B/C] of Portion 2 in the amount of [ ] Euro ((EURO)[ ]) is to be paid
on our behalf to the Hermes Agent for on-payment to Hermes in [payment/part
payment] of the balance of the Hermes Insurance Premium.]
We attach a Certified Copy of such documents as we have received from [the
Builder pursuant to the Building Contract in evidence of the instalment due]
[and] [[the Hermes Agent][Hermes] in evidence of the Hermes Premium payable].
We confirm that:
(i) all of the representations and warranties contained in Clause 9 of the
Loan Agreement remain true and correct;
(ii) no Possible Event of Default or Event of Default has occurred;
(iii) subject to Clause 5.3.1 of the Loan Agreement, the first Interest Period
shall be of [three (3) six (6)] months' duration; [and]
(iv) [[Tranche [ ] of Portion 1 will be applied in financing [part of] the
[third/fourth/fifth] [pre-delivery] [delivery] instalment due to the
Builder pursuant to the Building Contract] PROVIDED THAT if the Builder is
not entitled pursuant to the Building Contract to utilise any part of
Portion 1 drawn down hereunder that amount will be returned by us to the
Agent and applied in accordance with Clause 4.7 of the Loan Agreement]
[[Tranche A of Portion 2 is in reimbursement to us of part of the amount
of the Hermes Premium paid by us to the Hermes Agent for on-payment to
Hermes on issue of the Hermes Cover] [Tranche B of Portion 2 will be
applied in [payment/part payment] of seventy five per cent (75%) of the
Hermes Insurance Premium payable on the later of the First Drawdown Date
and the issue of the Hermes Cover] [Tranche C of Portion 2 will be applied
in part payment of the increase in the Hermes Insurance Premium] PROVIDED
THAT if the amount of the Hermes
114
Premium is reduced and the amount of the reduction is paid to us, eighty
per cent (80%) of the amount of the reduction will be returned by us to
the Agent and applied in accordance with Clause 4.7 of the Loan
Agreement];
(v) [twenty per cent (20%) of the Contract Price has been or will have been
paid on the First Drawdown Date;]
(vi) [the Hermes Issuing Fees and twenty five per cent (25%) of the Hermes
Insurance Premium will have been paid on the Drawdown Date referred to in
this notice;]
(vii) [the scheduled Delivery Date of the Vessel is [ ] 2006];]
(viii) [upon application of Tranche 4 of Portion 1 hereby requested to be drawn
down in the manner hereinbefore appearing all sums owing to the Builder
under the Building Contract shall have been fully and finally paid;] and
(ix) [upon application of Tranche [B/C] of Portion 2 hereby requested to be
drawn down in the manner hereinbefore appearing all sums owing [for the
present time] to Hermes in respect of the Hermes Cover shall have been
fully and finally paid].
Yours faithfully
SHIP VENTURES INC.
_______________________________
By:
115
SCHEDULE 4
CONDITIONS PRECEDENT
CLAUSE 2.7
The Loan is expressly conditional upon the Agent having received in such form
and substance as it shall require:
A ON THE DATE HEREOF
BORROWER
1 Certified Copies of any consents required from any ministry, governmental,
financial or other authority for the execution of and performance by the
Borrower of its obligations under this Agreement and each of the Security
Documents or if no such consents are required a secretary's certificate of
the Borrower to this effect confirming that no such consents are required.
2 Notarially attested secretary's certificate for the Borrower:
(A) attaching a copy of its Certificate of Incorporation and Articles of
Incorporation and By-Laws evidencing power to:
(i) enter into the transactions contemplated in this Agreement and
in the other Security Documents and to buy ships and enter
into arrangements for the chartering and management thereof;
and
(ii) borrow money in the amount referred to in this Agreement and
as security therefor to mortgage or charge assets;
(B) giving the names of the present directors and officers;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform the Borrower's obligations
under the Security Documents;
(D) giving the name of the Shareholder and the amount of the
Shareholder's Shares;
116
(E) attaching copies of resolutions of the directors of the Borrower
and, if required by its Articles of Incorporation and/or By-Laws,
copies of the resolutions of the Shareholder, authorising the
borrowing of the Loan, the granting of the Mortgages and the
execution of this Agreement and such of the other Security Documents
to which the Borrower is a party and the issue of any power of
attorney to execute the same; and
(F) containing a declaration of solvency as at the date of the
secretary's certificate.
3 Where the secretary's certificate referred to in paragraph 2 of this
Schedule 4 is dated more than ten (10) Business Days prior to the date
hereof, a bringdown certificate, which need not be notarially attested if
signed by the same person that signed the secretary's certificate referred
to in paragraph 2 of this Schedule 4.
4 The original power of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 2(C) above, notarially attested.
GUARANTOR, SHAREHOLDER, SUPERVISOR AND BUILDER
5 Notarially attested secretary's certificate for each of the above:
(A) attaching a copy of its Certificate of Incorporation and Memorandum
and Articles of Association (or equivalent documents) evidencing
power to enter into the transactions contemplated by this Agreement;
(B) giving the names of the present officers and directors;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform obligations under the
Security Documents;
(D) attaching copies of resolutions passed at a duly convened meeting of
the directors approving the granting and the execution of the
documents whose execution is contemplated hereby, insofar as they
relate to it and the issue of any power of attorney to execute the
same; and
(E) containing a declaration of solvency as at the date of the
secretary's certificate.
6 Where the secretary's certificate referred to in paragraph 5 of this
Schedule 4 is dated more than ten (10) Business Days prior to the date
hereof, a bringdown certificate, which
117
need not be notarially attested if signed by the same person that signed
the secretary's certificate referred to in paragraph 5 of this Schedule 4.
7 The original powers of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 5(C) above, notarially attested.
GENERAL
8 Confirmation from the Process Agent that it will act for each of the
Obligors and, if necessary, the Builder as agent for service of process in
England.
9 Opinions from lawyers appointed by the Agent including English, Isle of
Man, Bermudan, German and United States lawyers as to any of the foregoing
matters or otherwise as the Agent may require in the form required by the
Agent.
10 Certified Copy of the Opinion Letter (as defined in the Building
Contract).
11 Certified Copy of the Building Contract including all addenda.
12 Certified Copy of the Supervision Agreement.
13 Agency and Trust Deed duly executed.
14 Guarantee duly executed.
15 Charge Option duly executed.
16 Copies of the audited consolidated report and accounts of Star for 2002
and, if available, for 2003, the unaudited consolidated accounts of the
Group for the financial quarter to 31 December 2003 and the unaudited
opening balance sheet of the Borrower.
17 Copies of all UCC-1 Financing Statements filed with the Secretary of State
of Delaware.
18 Evidence that the withholding tax exemption applies for each of the
Lenders.
19 Payment of all fees under Clause 13.
20 Disclosure Letter duly executed.
118
B AT LEAST FIVE (5) BUSINESS DAYS BEFORE EACH DRAWDOWN DATE IN RESPECT OF
PORTION 1 AND PORTION 2
21 Drawdown notice duly executed by the Borrower in the form of Schedule 3.
22 In the case of Portion 1, a Certified Copy of such documents as are
received by the Borrower from the Builder pursuant to the Building
Contract in evidence of the instalment due.
23 In the case of Portion 2, a Certified Copy of such documents as are
received by the Borrower from Hermes or the Hermes Agent in evidence of
the Hermes Premium payable.
C ON THE FIRST DRAWDOWN DATE
24 Certified Copy of the Hermes Cover.
25 Certified Copy of the "Exporteurgarantie" to be given by the Builder in
favour of the Hermes Agent.
26 Evidence of the payment by the Borrower to the Builder of not less than
twenty per cent (20%) of the Contract Price pursuant to the Building
Contract.
27 Pre-Delivery Mortgage duly executed and lodged for registration in the
Shipbuilding Register in Emden.
28 Earnings Assignment duly executed.
29 Building Contract Assignment duly executed.
30 Construction Risks Insurance Assignment duly executed.
31 Supervision Agreement Assignment duly executed.
32 Telefax confirmations from the insurance brokers through whom any
insurances have been placed by the Builder and the Borrower in respect of
the Vessel during the Construction Period that the insurances have been
placed and upon receipt of a notice of assignment of the insurances they
will issue letters of undertaking in the form approved by the Agent.
119
33 Written confirmation from the Agent's insurance advisers that the
Insurances are in a form satisfactory to the Agent.
34 Notarially attested bringdown certificate in respect of the Borrower, the
Supervisor and the Builder where the secretary's certificate referred to
in the relevant paragraph of this Schedule 4 is dated more than ten (10)
Business Days prior to the First Drawdown Date.
35 Opinion from German lawyers appointed by the Agent as to due registration
of the Vessel and due registration of the Pre-Delivery Mortgage or
otherwise as the Agent may require in the form required by the Agent.
D ON EACH DRAWDOWN DATE IN RESPECT OF PORTION 2
36 Evidence of the payment by the Borrower (or the Hermes Agent on its
behalf) of the Hermes Premium (or relevant part thereof).
E ON THE DELIVERY DATE
37 Such evidence as the Agent may require that the Vessel is:
(A) registered in the name of the Borrower under the laws and flag of
the United States of America, free from all liens and encumbrances
except the Post Delivery Mortgage;
(B) classified with the highest classification available free of all
recommendations and qualifications with Det Norske Veritas and
American Bureau of Shipping;
(C) insured in accordance with the terms of the Security Documents; and
(D) managed by the Manager and the Sub-Agent pursuant to the Management
Agreement and the Sub-Agency Agreement.
38 Certified Copy of the Builder's Certificate.
39 Certified Copy of the unconditional protocol of delivery and acceptance
duly signed by the Builder and the Borrower.
40 Certified Copy of the certificate of warranty from the Builder stating
that the Vessel is free from all encumbrances on the Delivery Date.
120
41 Copies of valid trading and other certificates to be produced by the
Builder pursuant to the Building Contract.
42 Post Delivery Mortgage duly executed and lodged for recordation at the
relevant authority of the United States of America.
43 Certified Copy of the advance foreign transfer approval obtained from the
Maritime Administration of the United States of America ("MARAD"). This
Marad pre-approval will have been issued for the benefit of the Trustee
and its successors and assigns pursuant to sections 9(c) and (e) of the
Shipping Xxx, 0000, as amended, of the United States of America to
transfer the Vessel to a foreign registry in the case of (A) the
occurrence of an Event of a Default or (B) a foreclosure of the Post
Delivery Mortgage or (C) the Vessel ceasing to be employed in regular
service in Hawaii and no longer being eligible to engage in the coastwise
transportation of passengers for hire as set forth in Public Law 108-7 of
the United States of America.
44 Insurance Assignment duly executed.
45 Telefax confirmations from the insurance brokers for marine risks (hull
and machinery) and the managers of any protection and indemnity or war
risks association through whom any Insurances have been placed in respect
of the Vessel that the Insurances have been placed and upon receipt of a
notice of assignment of the Insurances they will issue letters of
undertaking in the form approved by the Agent.
46 Written confirmation from the Agent's insurance advisers that the
Insurances are in a form satisfactory to the Agent.
47 Certified Copy of the Management Agreement.
48 Certified Copy of the Sub-Agency Agreement.
49 Management Agreement Assignment duly executed.
50 Sub-Agency Agreement Assignment duly executed.
51 Account Charge duly executed.
52 Evidence that the Operating Account has been opened for receipt of the
Earnings of the Vessel in accordance with Clause 7.6.
121
53 Opinion from lawyers appointed by the Agent as to due registration of the
Vessel and due registration of the Post Delivery Mortgage or otherwise as
the Agent may require in the form required by the Agent.
54 Evidence of the payment by the Borrower of the Hermes Premium in full.
55 Notarially attested bringdown certificate in respect of the Borrower.
56 Notarially attested secretary's certificate for each of the Manager and
the Sub-Agent:
(A) attaching a copy of its Certificate of Incorporation and its
Memorandum of Association and Bye-Laws (or equivalent documents)
evidencing power to enter into the transactions contemplated by this
Agreement;
(B) giving the names of the present officers and directors;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform obligations under the
Security Documents;
(D) attaching copies of resolutions passed at a duly convened meeting of
the directors approving the granting and the execution of the
documents whose execution is contemplated hereby, insofar as they
relate to it and the issue of any power of attorney to execute the
same; and
(E) containing a declaration of solvency as at the date of the
secretary's certificate.
57 Where the secretary's certificate referred to in paragraph 56 of this
Schedule 4 is dated more than ten (10) Business Days prior to the date
hereof, a bringdown certificate, which need not be notarially attested if
signed by the same person that signed the secretary's certificate referred
to in paragraph 56 of this Schedule 4.
58 The original powers of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 56(C) above, notarially attested.
59 Copies of all UCC-1 Financing Statements filed with the Secretary of State
of Delaware.
60 Payment of all fees due under Clause 13.
61 A Certified Copy of the carrier initiative agreement executed pursuant to
the Post Delivery Mortgage.
122
62 A Certified Copy of any current certificate of financial responsibility in
respect of the Vessel issued under OPA.
63 A Certified Copy of a valid safety management certificate (or interim
safety management certificate) issued to the Vessel in respect of its
management by the Manager pursuant to the ISM Code.
64 A Certified Copy of a valid document of compliance (or interim document of
compliance) issued to the Manager in respect of ships of the same type as
the Vessel pursuant to the ISM Code.
65 A Certified Copy of a valid international ship security certificate issued
to the Vessel in accordance with the ISPS Code.
123
SCHEDULE 5
CONFIDENTIALITY UNDERTAKING
[On Bank's Headed Paper]
To: SHIP VENTURES INC.
Corporation Trust Center
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx
Xxxxxxxx 00000
Xxxxxx Xxxxxx of America
(the "BORROWER")
HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Attn: Mr Xxxx Xxxxxxxx
(the "AGENT")
SHIP VENTURES INC.
DOLLAR EQUIVALENT OF (EURO)308,130,000 TERM LOAN (THE "FACILITY")
FORM OF CONFIDENTIALITY UNDERTAKING
1 We hereby undertake that we will keep confidential and will not make use
of for any purposes (other than for the purposes of the Facility) all
information delivered to us in connection with the Facility and all
information obtained by us in the course of discussions with the Agent,
the Borrower or any other party involved with the Facility (collectively
the "INFORMATION") until and save to the extent that the Information has
been released into the public domain. However, we shall be entitled to
supply the Information to:
(A) professional advisers solely for use in connection with the Facility
after drawing to the attention of those advisers the content of the
undertaking as to confidentiality given by us and after obtaining
similar undertakings from them; and
(B) any third party where we have been authorised in writing to do so by
the Borrower; and
124
(C) subject to giving reasonable prior notice to the Borrower, to any
banking or regulatory authority to which we are subject after
drawing to the attention of such authority the content of the
undertaking as to confidentiality given by us; and
(D) pursuant to subpoena or other legal process and pursuant to any law
or regulation having the force of law.
2 We further undertake that if we decide not to participate in the Facility,
we will return to the Agent the originals and additional copies or
extracts made therefrom and all documentary Information delivered to us by
the Agent in relation to the Facility and/or the Borrower (including any
supplied to third parties as contemplated in paragraph 1).
For and on behalf of
BANK NAME:
____________________________
By
Date:
125
SCHEDULE 6
TRANSFER CERTIFICATE
Lenders are advised not to employ Transfer Certificates or otherwise to assign
or transfer interests in the Loan Agreement without further ensuring that the
transaction complies with all applicable laws and requisitions, including the
Financial Services Xxx 0000 and regulations made thereunder and similar statutes
which may be in force in other jurisdictions.
TO: hsbc Bank plc (the "AGENT") as agent on its own behalf and for and
on behalf of the Arrangers, the Hermes Agent, the Trustee, the
Borrower and the Lenders as defined in the Loan Agreement referred
to below
Attention: [ ]
Date:
This certificate (the "TRANSFER CERTIFICATE") relates to a loan agreement dated
2004 (as the same may from time to time be amended, supplemented and/or
novated the "LOAN AGREEMENT") made between (among others) (1) Ship Ventures Inc.
as borrower (the "BORROWER") (2) the banks and financial institutions referred
to therein as lenders (the "LENDERS") (3) the Agent (4) Commerzbank
Aktiengesellschaft (the "HERMES AGENT") and (5) HSBC Bank plc (the "TRUSTEE")
whereby the Lenders have agreed to make available to the Borrower a term loan
facility in the amount of up to three hundred and eight million one hundred and
thirty thousand Euro ((EURO) 308,130,000) and/or the Equivalent Amount thereof.
Terms defined in the Loan Agreement shall, unless otherwise defined herein, have
the same meanings herein as therein.
In this Transfer Certificate:
the "TRANSFEROR" means [full name] of [Office];
the "TRANSFEREE" means [full name] of [Office].
1 The Transferor with full title guarantee transfers to the Transferee
absolutely in accordance with Clause 17.5 of the Loan Agreement all rights
and interests (present, future or contingent) which the Transferor has as
Lender under or by virtue of the Loan Agreement and all the other Security
Documents insofar as such rights and interests relate to [that portion of
its Contribution to the Loan in an amount equal to [[ ] Dollars
126
(USD[ ]) [and [ ] Euro (E[ ])] out of its total Contribution which at
the date hereof is [ ] Dollars (USD[ ]) [and [ ] Euro ((EURO)[ ])] or
[that portion of its Commitment to the Facility in an amount of [ ] Euro
((EURO)[ ]) or an amount in Dollars equal to [ ] Euro ((EURO)[ ]) out of
its total Commitment which at the date hereof is [ ] Euro ((EURO)[ ]) in
Euro and/or in Dollars].
2 By virtue of this Transfer Certificate and Clause 17.5 of the Loan
Agreement, the Transferor is discharged entirely with effect from the
Transfer Date from [that portion of its Contribution to the Loan and its
obligations relating thereto to the extent of [[ ] Dollars (USD[ ]) and
[ ] Euro ((EURO)[ ]) out of its total Contribution at such date] or
[that portion of its Commitment to the Facility and its obligations
relating thereto to the extent of [ ] Euro ((EURO)[ ]) in Euro and/or in
Dollars out of its total Commitment at such date].
3 The Transferee hereby requests:
(A) the Borrower, the Agent, the Hermes Agent, the Trustee, the
Arrangers and the Lenders to accept the executed copies of this
Transfer Certificate as being delivered pursuant to and for the
purposes of Clause 17.5 of the Loan Agreement; and
(B) the Agent to execute this Transfer Certificate on behalf of itself
and the other said parties pursuant to Clause 17.8 of the Loan
Agreement so that this Transfer Certificate will take effect in
accordance with the terms thereof on [specify date of transfer] [or]
[the date on which the Agent receives a certificate signed by [the
Transferor] confirming that the following conditions have been
fulfilled [specify conditions to transfer].
4 The Transferee:
(A) confirms that it has received a copy of the Loan Agreement, the
Agency and Trust Deed and the other Security Documents together with
such other documents and information as it has required in
connection with the transaction contemplated thereby;
127
(B) confirms that it has not relied and will not hereafter rely on the
Transferor, the Trustee, the Agent, the Arrangers, the Lenders or
the Hermes Agent to check or enquire on its behalf into the
legality, validity, effectiveness, adequacy, accuracy or
completeness of the Loan Agreement, the Agency and Trust Deed or any
other of the Security Documents or any other documents or
information;
(C) agrees that it has not relied and will not rely on the Transferor,
the Trustee, the Agent, the Arrangers, the Lenders or the Hermes
Agent to assess or keep under review on its behalf the financial
condition, creditworthiness, condition, affairs, status or nature of
the Borrower or any other party to the Loan Agreement or any other
of the Security Documents (save as otherwise expressly provided
therein);
(D) warrants that it has power and authority to become a party to the
Loan Agreement and the Agency and Trust Deed and has taken all
necessary action to authorise execution of this Transfer Certificate
and to obtain all necessary approvals and consents to the assumption
of its obligations under the Loan Agreement, the Agency and Trust
Deed and the other Security Documents;
(E) if not already a Lender, appoints the Agent to act as its agent
(except in relation to the Hermes Cover), the Hermes Agent to act as
its agent in relation to the Hermes Cover and the Trustee to act as
its trustee as provided in the Loan Agreement, the Agency and Trust
Deed and the other Security Documents and agrees to be bound by the
terms of Clause 17.8 of the Loan Agreement and by all the terms of
the Agency and Trust Deed.
5 The Transferor:
(A) warrants to the Transferee that it has full power to enter into this
Transfer Certificate and has taken all corporate action necessary to
authorise it to do so;
(B) warrants to the Transferee that this Transfer Certificate is binding
on the Transferor under the laws of (i) England (ii) the country in
which the Transferor is incorporated and (iii) the country in which
its Office is located; and
(C) agrees that it will, at its own expense, execute any documents which
the Transferee reasonably requests for perfecting in any relevant
jurisdiction the Transferee's title under this Transfer Certificate
or for any similar purpose.
128
6 The Transferee hereby undertakes to the Transferor and each of the other
parties to the Loan Agreement and the Agency and Trust Deed that it will
perform in accordance with its terms all those obligations which by the
terms of the Loan Agreement and the Agency and Trust Deed will be assumed
by it after the transfer contemplated by this Transfer Certificate has
taken effect.
7 If a Transferor and a Transferee effect a transfer in accordance with
Clause 3 of this Transfer Certificate during an Interest Period, the Agent
shall make all payments which would have become due to the Transferor
under the Loan Agreement during the relevant Interest Period to the
Transferor, as if no such transfer had been effected by the Transferor to
the Transferee, according to the percentages of the Transferor's
Contribution and/or Commitment transferred and retained pursuant to
Clauses 1 and 2 of this Transfer Certificate, and the Transferor and the
Transferee shall be responsible for paying to each other pro rata all
amounts (if any) due to them from each other for such Interest Period. On
and from the commencement of the immediately succeeding Interest Period,
the Agent shall make all payments due under the Loan Agreement for the
account of the Transferor, to the Transferor, and shall make all payments
due under the Loan Agreement for the account of the Transferee, to the
Transferee. This provision is for administrative convenience only and
shall not affect the rights of the Transferor and the Transferee under the
Loan Agreement.
8 None of the Transferor, the Agent, the Hermes Agent, the Trustee, the
Arrangers or the Lenders:
(A) makes any representation or warranty nor assumes any responsibility
with respect to the legality, validity, effectiveness, adequacy or
enforceability of the Loan Agreement, the Agency and Trust Deed or
any other of the Security Documents or any document relating
thereto;
(B) assumes any responsibility for the financial condition of the
Borrower or any other party to the Loan Agreement, the Agency and
Trust Deed or any other of the Security Documents or any such other
document or for the performance and observance by the Borrower or
any other party to the Loan Agreement, the Agency and Trust Deed or
any other of the Security Documents or any such other document (save
as otherwise expressly provided therein) and any and all such
conditions and warranties, whether expressed or implied by law or
otherwise, are hereby excluded (except as aforesaid).
129
9 The Transferor and the Transferee each undertakes that it will on demand
fully indemnify the Agent in respect of any claim, proceeding, liability
or expense which relates to or results from this Transfer Certificate or
any matter connected with or arising out of it unless caused by the
Agent's gross negligence or wilful misconduct, as the case may be.
10 The agreements and undertaking of the Transferee in this Transfer
Certificate are given to and for the benefit of and made with each of the
other parties to the Loan Agreement.
11 This Transfer Certificate shall be governed by, and construed in
accordance with, English law.
IN WITNESS whereof the Transferor, the Transferee and the Agent (as agent for
and on behalf of itself as Agent, the Hermes Agent, the Trustee, the Arrangers,
the Borrower and the Lenders (other than the Transferor)) have caused this
Transfer Certificate to be executed on the day first written above.
THE TRANSFEROR
SIGNED by )
)
for and on behalf of )
[ ] )
in the presence of: )
THE TRANSFEREE
SIGNED by )
)
for and on behalf of )
[ ] )
in the presence of: )
130
THE AGENT
SIGNED by )
)
for and on behalf of )
[ ] )
as agent for and on behalf )
of itself as Agent, )
the Hermes Agent, the Trustee, )
the Arrangers, the Borrower, )
the Guarantor and the Lenders )
in the presence of: )
Note: The execution of this Transfer Certificate alone may not transfer a
proportionate share of the Transferor's interest in the security
constituted by the Security Documents in the Transferor's or Transferee's
jurisdiction. It is the responsibility of each individual Lender to
ascertain whether any other documents are required to perfect a transfer
of such a share in the Transferor's interest in such security in any such
jurisdiction, and, if so, to seek appropriate advice and arrange for
execution of the same.
131
SCHEDULE
ADMINISTRATIVE DETAILS OF TRANSFEREE
Name of Transferee:
Office:
Contact Person
(Loan Administration Department):
Telephone:
Fax:
E-mail:
Contact Person
(Credit Administration Department):
Telephone:
Fax:
E-mail:
Account for Payments:
132
SCHEDULE 7
FORM OF NOTICE OF FIXED RATE
To: SHIP VENTURES INC. (the "BORROWER")
Corporation Trust Center
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx
Xxxxxxxx 00000
Xxxxxx Xxxxxx of America
From: HSBC BANK PLC (the "FACILITY AGENT")
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Attn: Mr Xxxx Xxxxxxxx
LOAN AGREEMENT DATED 2004 BETWEEN (AMONG OTHERS) (1) THE BORROWER (2) THE
LENDERS (3) THE AGENT (4) THE HERMES AGENT AND (5) THE TRUSTEE (THE "LOAN
AGREEMENT") RELATING TO THE FINANCING OF THE CONSTRUCTION OF HULL NO S.668 AT
XXX. X. XXXXX GmbH
The Agent hereby gives notice to the Borrower that, pursuant to Clause 5.5
(Fixed Rate) of the Loan Agreement, the Borrower shall from [date] 2006 pay
interest on the outstanding amount of the Loan at the Fixed Rate of [ ] per cent
([o]%) per annum.
Capitalised terms used herein shall have the same meanings as in the Loan
Agreement.
Date: 200[4/5/6]
____________________________
HSBC BANK PLC
By:
Agreed:
____________________________
SHIP VENTURES INC.
By:
133
SCHEDULE 8
CHARTERING OF THE SIX VESSELS (AS DEFINED IN CLAUSE 10.6.4)
VESSEL NEW OWNER DAILY HIRE REDELIVERING TRANSFER VALUE
------ --------- ---------- ------------ --------------
Norwegian Sea Xxxxx Xxxxxxx Limited [***] [Confidential Treatment]
Norwegian Majesty Ocean Voyager Limited [***] [Confidential Treatment]
Norwegian Wind Crown Wind Limited [***] [Confidential Treatment]
Norwegian Crown Crown Odyssey Limited [***] [Confidential Treatment]
Norwegian Dream Ocean Dream Limited [***] [Confidential Treatment]
Xxxxx Xxxx Ocean World Limited [***] [Confidential Treatment]
134
CONFORMED COPY
Dated 25 October 2004
SHIP VENTURES INC.
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
HSBC BANK PLC
(as trustee)
---------------------------------------------------------------
FIRST ADDENDUM TO
SECURED LOAN AGREEMENT
for the equivalent amount in United States Dollars
of up to E308,130,000
pre- and post delivery finance
for one luxury cruise vessel with 1,188 passenger cabins
being hull no S.668 at the yard of Xxx. X. Xxxxx GmbH
--------------------------------------------------------------
XXXXXXXXXX XXXXXXX
Xxx Xx Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
Tel: x00 (0)00 0000 0000
Fax: x00 (0)00 0000 0000
Ref:- 1253/42-02376
CONTENTS
Page
----
1 Definitions and Construction ..................................... 1
2 Amendment of Original Loan Agreement and Security Documents ...... 2
3 Conditions Precedent.............................................. 3
4 Representations and Warranties ................................... 5
5 Expenses.......................................................... 7
6 Further Assurance ................................................ 7
7 Counterparts...................................................... 7
8 Notices........................................................... 7
9 Contracts (Rights of Third Parties) Xxx 0000 (the "Act").......... 8
10 Governing Law..................................................... 9
11 Jurisdiction ..................................................... 9
Schedule 1 Particulars of Trustee ....................................... 12
THIS FIRST ADDENDUM TO THE LOAN AGREEMENT is made the 25 day of October 2004
BETWEEN:
(1) SHIP VENTURES INC. of Corporation Trust Center, 0000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Xxxxxx Xxxxxx of America as borrower (the
"Borrower");
(2) NCL CORPORATION LTD. of Xxxxxx Xxxxx, 00 Xxxxxxxxxx Xxxxxx, Xxxxxxxx XX
00, Xxxxxxx as guarantor (the "Guarantor"); and
(3) HSBC BANK PLC of 0 Xxxxxx Xxxxxx, Xxxxxx X00 0XX as trustee (the
"Trustee").
WHEREAS:
(A) By a loan agreement dated 20 April 2004 (the "Original Loan Agreement")
the Arrangers have agreed on the terms and subject to the conditions
set out in the Original Loan Agreement to arrange and underwrite a loan
in the Equivalent Amount of up to three hundred and eight million one
hundred and thirty thousand Euro (E308,130,000), subject to Clause 2.5
of the Original Loan Agreement, to be made by the Lenders to the
Borrower to part-finance (among other things) the construction by the
Builder of the Vessel for the Contract Price.
(B) The parties to the Original Loan Agreement have agreed to amend certain
definitions contained in clause 1.1 of the Original Loan Agreement on
the terms of this first addendum to the Original Loan Agreement (the
"Deed"). This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1 Definitions and Construction
1.1 In this Deed including the preamble and recitals hereto
(unless the context otherwise requires) any term or expression
defined in the preamble or the recitals shall have the meaning
ascribed to it therein and terms and expressions not defined
herein but whose meanings are defined in the Loan Agreement
shall have the meanings set out therein. In addition, the
following terms and expressions shall have the meanings set
out below:
"Loan Agreement" means the Original Loan Agreement as amended
by this Deed; and
"Effective Date" means the date on which the conditions
precedent set out in Clause 3.1 are fullfilled to the
satisfaction of the Agent.
1.2 The provisions of Clauses 1.2 and 1.3 of the Original Loan
Agreement as amended by this Deed shall apply hereto (mutatis
mutandis).
2 Amendment of Original Loan Agreement and Security Documents
2.1 The parties hereto agree that immediately upon and with effect
from the Effective Date the Original Loan Agreement shall be
read and construed as if the definitions of "Tranche 1",
"Tranche 2", "Tranche 3" and "Tranche 4" in clause 1.1 thereof
had been deleted and substituted with the following:
"Tranche 1" means the amount of twenty seven million three
hundred and ninety thousand Euro (E627,390,000) or the
Equivalent Amount thereof to be applied in payment of the
balance of the third pre-delivery instalment due by the
Borrower to the Builder under the Building Contract to be
advanced by the Lenders on a Drawdown Date by way of their
Contributions thereto;
"Tranche 2" means the amount of sixty six million two hundred
and forty thousand Euro (E66,240,000) or the Equivalent Amount
thereof to be applied in payment of the fourth pre-delivery
instalment due by the Borrower to the Builder under the
Building Contract to be advanced by the Lenders on a Drawdown
Date by way of their Contributions thereto;
"Tranche 3" means the amount of sixty six million two hundred
and forty thousand Euro (E666,240,000) or the Equivalent
Amount thereof to be applied in payment of the fifth
pre-delivery instalment due by the Borrower to the Builder
under the Building Contract to be advanced by the Lenders on a
Drawdown Date by way of their Contributions thereto;
"Tranche 4" means the amount of up to one hundred and twenty
eight million and ten thousand Euro (E128,010,000) or the
Equivalent Amount thereof to be applied in payment of the
delivery instalment due by the Borrower to the Builder under
the Building Contract to be advanced by the Lenders on the
Delivery Date
2
by way of their Contributions thereto PROVIDED THAT the Euro
amount of this Tranche and the Euro amounts of the other
Tranches shall not when aggregated exceed eighty per cent
(80%) of the Contract Price;
2.2 Each of the Borrower and the Guarantor hereby confirms to the
Trustee that with effect from the Effective Date:
2.2.1 all references to the Original Loan Agreement in the
Security Documents to which it is a party shall be
construed as references to the Original Loan
Agreement as amended by this Deed and all terms used
in such Security Documents whose meanings are defined
by reference to the Original Loan Agreement shall be
defined by reference to the Original Loan Agreement
as so amended;
2.2.2 the Security Documents to which it is a party shall
apply to, and extend to secure, the whole of the
Outstanding Indebtedness as defined in clause 1.1I of
the Original Loan Agreement as amended by this Deed;
2.2.3 its obligations under the Security Documents to which
it is a party shall not be discharged, impaired or
otherwise affected by reason of the execution of this
Deed or of any of the documents contemplated hereby;
and
2.2.4 its obligations under the Security Documents to which
it is a party shall remain in full force and effect
as security for the obligations of the Borrower under
the Original Loan Agreement and the other Security
Documents as amended by this Deed.
2.3 Except as expressly amended hereby or pursuant hereto the
Original Loan Agreement and the Security Documents shall
remain in full force and effect and nothing herein contained
shall relieve the Borrower or any other Obligor from any of
its respective obligations under any such documents.
3 Conditions Precedent
3.1 The amendment of the Original Loan Agreement provided for in
Clause 2 is conditional upon and shall not be effective unless
and until the Agent has received the following in form and
substance satisfactory to it:
3
3.1.1 on the date of this Deed, one (1) counterpart duly
executed by each of the Borrower and the Guarantor of
this Deed;
3.1.2 the following corporate documents in respect of each
of the Borrower and the Guarantor (together the
"Relevant Parties"):
(a) Certified Copies of any consents required
from any ministry, governmental, financial
or other authority for the execution of and
performance by the respective Relevant Party
of its obligations under this Deed or if no
such consents are required a certificate
from a duly appointed officer of the
Relevant Party to this effect confirming
that no such consents are required;
(b) notarially attested secretary's certificate
of each of the Relevant Parties:
(i) attaching a copy of its Certificate
of Incorporation and Memorandum of
Association and Bye-Laws (or
equivalent constitutional
documents) evidencing power to
enter into the transactions
contemplated in this Deed;
(ii) giving the names of its present
officers and directors;
(iii) setting out specimen signatures of
such officers and directors as are
authorised by the Relevant Party to
sign documents or otherwise
undertake the performance of that
Relevant Party's obligations under
this Deed;
(iv) giving the legal owner of its
shares and the number of such
shares held;
(v) attaching copies of resolutions
passed at duly convened meetings of
the directors and, if required by
the Agent, the shareholders or
members of each of the Relevant
Parties authorising (as applicable)
the execution of this Deed and any
documents contemplated in this Deed
and the issue of any power of
attomney to execute the same; and
4
(vi) containing a declaration of
solvency as at the date of the
certificate of the duly appointed
officer of the Relevant Party; or
(if applicable) a notarially attested bring
down certificate duly executed by the
secretary of the Relevant Party in respect
of his secretarial certificate dated 16
April 2004;
3.1.3 the original powers of attorney, if any, issued
pursuant to the resolutions referred to above and
notarially attested;
3.1.4 the issue of such favourable written legal opinions
including in respect of Delaware and Bermuda in such
form as the Agent may require relating to all aspects
of the transactions contemplated hereby governed by
any applicable law, and
PROVIDED THAT no Event of Default and no Possible Event of
Default has occurred and is continuing on the Effective Date.
3.2 If the Lenders, acting unanimously, decide (or the Agent in
accordance with the Agency and Trust Deed decides) to permit
the amendment of the Original Loan Agreement hereby without
having received all of the documents or evidence referred to
in Clause 3.1, the Borrower will nevertheless deliver the
remaining documents or evidence to the Agent within fourteen
(14) days of the Effective Date (or such other period as the
Agent may stipulate) and the amendment of the Original Loan
Agreement shall not be construed as a waiver of the Agent's
right to receive the documents or evidence as aforesaid nor
shall this provision impose on the Agent or the Lenders any
obligation to permit the amendment in the absence of such
documents or evidence.
4 Representations and Warranties
4.1 Each of the Borrower and the Guarantor represents and warrants
to the Trustee that:
4.1.1 it has the power to enter into and perform this Deed
and the transactions contemplated hereby and has
taken all necessary action to authorise the entry
into and performance of this Deed and such
transactions;
5
4.1.2 this Deed constitutes its legal, valid and binding
obligations enforceable in accordance with its terms;
4.1.3 its entry into and performance of this Deed and the
transactions contemplated hereby do not and will not
conflict with:
(a) any law or regulation or any official or
judicial order; or
(b) its constitutional documents; or
(c) any agreement or document to which it is a
party or which is binding upon it or any of
its assets,
nor result in the creation or imposition of any
Encumbrance on it or its assets pursuant to the
provisions of any such agreement or document and in
particular but without prejudice to the foregoing the
entry into and performance of this Deed and the
transactions contemplated hereby will not render
invalid, void or voidable any security granted by it
to the Trustee;
4.1.4 all authorisations, approvals, consents, licences,
exemptions, filings, registrations, notarisations,
and other matters, official or otherwise, required in
connection with the entry into, performance, validity
and enforceability of this Deed and each of the other
documents contemplated hereby and the transactions
contemplated thereby have been obtained or effected
and are in full force and effect;
4.1.5 all information furnished by it to the Agent or its
agents relating to the business and affairs of an
Obligor in connection with this Deed and the other
documents contemplated hereby was and remains true
and correct in all material respects and there are no
other material facts or considerations the omission
of which would render any such information
misleading;
4.1.6 it has fully disclosed in writing to the Agent all
facts relating to its business which it knows or
should reasonably know and which might reasonably be
expected to influence the Lenders, the Agent or the
Hermes Agent in deciding whether to authorise the
Trustee to enter into this Deed
6
on their behalf and/or the Trustee in deciding
whether or not to enter into this Deed.
5 Expenses
Each of the parties hereto shall bear its own costs, charges and
expenses (together with value added tax or any similar tax thereon and
including without limitation the fees and expenses of legal and other
advisers) in respect of the negotiation, preparation, printing,
execution and registration of this Deed and any other documents
required in connection with the implementation of this Deed. However,
the Borrower and the Guarantor jointly and severally undertake to
reimburse the Agent on demand on a full indemnity basis for the
reasonable charges and expenses (together with value added tax or any
similar tax thereon and including without limitation the fees and
expenses of legal and other advisers) in respect of the enforcement of
this Deed and any other documents required in connection with the
implementation of this Deed.
6 Further Assurance
Each of the Borrower and the Guarantor will, from time to time on being
required to do so by the Agent, do or procure the doing of all such
acts and/or execute or procure the execution of all such documents in a
form satisfactory to the Agent and the Hermes Agent as the Agent and
the Xxxxxx Agent may reasonably consider necessary for giving full
effect to this Deed or any of the documents contemplated hereby or
securing to the Trustee the full benefit of the rights, powers and
remedies conferred upon the Trustee in any such document.
7 Counterparts
This Deed may be executed in any number of counterparts and all such
counterparts taken together shall be deemed to constitute one and the
same agreement.
8 Notices
8.1 Any notice, demand or other communication (unless made by
telefax) to be made or delivered to the Borrower or the
Guarantor pursuant to this Deed shall (unless the Borrower or
the Guarantor has by fifteen (15) days' written notice to the
Agent specified another address) be made or delivered to the
Borrower and/or the Guarantor c/o 0000 Xxxxxxxxx Xxxxxx Xxxxx,
Xxxxx, Xxxxxxx 00000, Xxxxxx Xxxxxx
7
of America (marked for the attention of Mr Larnarr Cooler and
the Legal Department (but one (1) copy shall suffice)) with a
copy to x/x Xxxx Xxxxxxx Xxxxxxx, 00xx Xxxxx, Xxxxx Genting,
Xxxxx Xxxxxx Xxxxxx, 00000 Xxxxx Xxxxxx, Xxxxxxxx (marked for
the attention of Xx Xxxxxx Xxx). Any notice, demand or other
communication to be made or delivered by the Borrower or the
Guarantor pursuant to this Deed shall (unless the Agent has by
fifteen (15) days' written notice to the Borrower and the
Guarantor specified another address) be made or delivered to
the Trustee at its Office, the details of which are set out in
Schedule 1.
8.2 Any notice, demand or other communication to be made or
delivered pursuant to this Deed may be sent by telefax to the
relevant telephone numbers (which at the date hereof in
respect of the Borrower and the Guarantor is x0 000 000 0000
(marked for the attention of Xx Xxxxxx Cooler) and x0 000 000
4117 (marked for the attention of the Legal Department) with a
copy to x00 0 0000 0000 (marked for the attention of Xx Xxxxxx
Xxx) and in the case of the Trustee is as recorded in Schedule
1) specified by it from time to time for the purpose and shall
be deemed to have been received when transmission of such
telefax communication has been completed. Each such telefax
communication, if made to the Trustee by the Borrower or the
Guarantor, shall be signed by the person or persons authorised
in writing by the Borrower or the Guarantor (as the case may
be) and whose signature appears on the list of specimen
signatures contained in the secretary's certificate required
to be delivered by Clause 3 and shall be expressed to be for
the attention of the department or officer whose name has been
notified for the time being for that purpose by the Trustee to
the Borrower and the Guarantor.
8.3 The provisions of clauses 18.1, 18.4 and 18.5 of the Original
Loan Agreement as amended by this Deed shall apply to this
Deed.
9 Contracts (Rights of Third Parties) Act 1999 (the "Act")
A person who is not a party to this Deed has no right under the Act to
enforce any term of this Deed but this does not affect any right or
remedy of a third party which exists or is available apart from the
Act.
8
10 Governing Law
This Deed shall be governed by English law.
11 Jurisdiction
11.1 The courts of England have exclusive jurisdiction to settle
any dispute arising out of or in connection with this Deed
(including a dispute regarding the existence, validity or
termination of this Agreement) (a "Dispute"). Each party to
this Deed agrees that the courts of England are the most
appropriate and convenient courts to settle Disputes and
accordingly no party will argue to the contrary.
This Clause 10.1 is for the benefit of the Trustee only. As a
result, no such party shall be prevented from taking
proceedings relating to a Dispute in any other courts with
jurisdiction. To the extent allowed by law, any such party may
take concurrent proceedings in any number of jurisdictions.
11.2 Neither the Borrower nor the Guarantor may, without the
Trustee prior written consent, terminate the appointment of
the Process Agent; if the Process Agent resigns or its
appointment ceases to be effective, the Borrower and/or the
Guarantor (as the case may be) shall within fourteen (14)
days appoint a company which has premises in London and has
been approved by the Trustee to act as the Borrower's and/or
the Guarantor's (as the case may be) process agent with
unconditional authority to receive and acknowledge service on
behalf of the Borrower and/or the Guarantor of all process or
other documents connected with proceedings in the English
courts which relate to this Deed.
11.3 For the purpose of securing its obligations under Clause 10.2,
each of the Borrower and the Guarantor irrevocably agrees
that, if it for any reason fails to appoint a process agent
within the period specified in Clause 10.2, the Trustee may
appoint any person (including a company controlled by or
associated with the Trustee, the Agent or any Lender) to act
as the Borrower's or the Guarantor's (as the case may be)
process agent in England with the unconditional authority
described in Clause 10.2.
11.4 No neglect or default by a process agent appointed or
designated under this Clause (including a failure by it to
notify the Borrower or the Guarantor (as the case may be) of
the service of any process or to forward any process to the
9
Borrower or the Guarantor (as the case may be)) shall
invalidate any proceedings or judgment.
11.5 Each of the Borrower and the Guarantor appoints in the case of
the courts of England the Process Agent to receive, for and on
its behalf service of process in England of any legal
proceedings with respect to this Deed.
11.6 A judgment relating to this Deed which is given or would be
enforced by an English court shall be conclusive and binding
on the Borrower and/or the Guarantor (as the case may be) and
may be enforced without review in any other jurisdiction.
11.7 Nothing in this Clause shall exclude or limit any right which
the Trustee may have (whether under the laws of any country,
an international convention or otherwise) with regard to the
bringing of proceedings, the service of process, the
recognition or enforcement of a judgment or any similar or
related matter in any jurisdiction.
11.8 In this Clause "judgment" includes order, injunction,
declaration and any other decision or relief made or granted
by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed
as a deed on the day first written above.
SIGNED SEALED and DELIVERED as a DEED )
by XXXX XXXX XXXXXX ) P.A. Xxxxxx
for and on behalf of )
SHIP VENTURES INC. )
in the presence of: )
Xxxx XxXxxx
XXXX XXXXXX
SIGNED SEALED and DELIVERED as a DEED )
by XXXX XXXX XXXXXX ) P.A. Xxxxxx
for and on behalf of )
NCL CORPORATION LTD. )
in the presence of: )
Xxxx XxXxxx
XXXX XXXXXX
10
SIGNED SEALED and DELIVERED as a DEED )
by X X XXXXXX )
for and on behalf of } X X Xxxxxx
HSBC BANK PLC )
as the Trustee (for and on behalf of itself, the Lenders, )
the Agent and the Hermes Agent) )
in the presence of: ) X. Xxxxxxx
X. XXXXXXX
11
Schedule 1
Particulars of Trustee
Name and Address
Trustee
HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Fax: x00 (0)00 0000 0000
Attn: Mr Xxxx Xxxxxxxx
Email: xxxx.x.xxxxxxxx@xxxxxx.xxx
12
CONFORMED COPY
DATED 20 APRIL 2004
(1) NCL CORPORATION LTD.
(AS GUARANTOR)
(2) HSBC BANK PLC
(AS TRUSTEE)
-------------------------------------------
GUARANTEE
IN RESPECT OF THE OBLIGATIONS OF
SHIP VENTURES INC.
-------------------------------------------
XXXXXXXXXX XXXXXXX
XXX XX XXXX'X XXXXXXXXXX
XXXXXX XX0X 0XX
TEL: x00 (0)00 0000 0000
FAX: + 00 (0)00 0000 0000
REF: 1253/42-02376
CONTENTS
Page
----
1 Definitions and Construction................................................................2
2 Guarantee and Indemnity.....................................................................3
3 Survival of Guarantor's Liability...........................................................4
4 Continuing Guarantee........................................................................6
5 Exclusion of the Guarantor's Rights.........................................................7
6 Payments....................................................................................8
7 Enforcement................................................................................10
8 Representations and Warranties.............................................................10
9 General Undertakings: Positive Covenants...................................................13
10 General Undertakings: Negative Covenants...................................................16
11 Financial Undertakings and Ownership and Control of the Guarantor..........................20
12 Issue of the Bonds.........................................................................27
13 Discharge..................................................................................27
14 Assignment and Transfer....................................................................27
15 Miscellaneous Provisions...................................................................28
16 Waiver of Immunity.........................................................................29
17 Notices....................................................................................29
18 Governing Law..............................................................................30
19 Jurisdiction...............................................................................30
Schedule 1 Quarterly Compliance Certificate...........................................................32
Schedule 2 Letter of Instruction......................................................................35
DEED
DATED the 20TH day of APRIL 2004
BY:
(1) NCL CORPORATION LTD. being a company validly existing under the laws of
Bermuda with its registered office at Xxxx Xxxx, 0 Xxxx Xxxxxx,
Xxxxxxxx XX 11, Bermuda as guarantor (the "GUARANTOR");
IN FAVOUR OF:
(2) HSBC BANK PLC a company incorporated under the laws of England and
Wales whose office is at 0 Xxxxxx Xxxxxx, Xxxxxx X00 0XX, Xxxxxxx (the
"TRUSTEE") as trustee for the Beneficiaries.
WHEREAS:
(A) By a loan agreement dated the date hereof (the "LOAN AGREEMENT") made
between (among others) (1) Ship Ventures Inc. as borrower (the
"BORROWER") (2) the banks whose names and Offices appear in schedule 2
to the Loan Agreement (the "LENDERS") (3) HSBC Bank plc as agent for
the Lenders (the "AGENT") (4) Commerzbank Aktiengesellschaft as agent
(the "HERMES AGENT") and (5) the Trustee, the Lenders agreed to make
available to the Borrower, upon the terms and subject to the conditions
thereof, a secured term loan of the equivalent in Dollars, subject to
clause 2.5 thereof, of up to three hundred and eight million one
hundred and thirty thousand Euro ((EURO) 308,130,000) (the "Loan") on
the terms and conditions contained therein.
(B) By a deed of agency and trust dated the date hereof made between (1)
the Agent (2) the Hermes Agent (3) the Trustee and (4) the Lenders it
has been agreed that the benefit of this Deed shall be held by the
Trustee on trust for itself, the Agent, the Hermes Agent and the
Lenders and its and their respective successors, assignees and
transferees (together the "BENEFICIARIES").
(C) It is a condition precedent to the Trustee, the Lenders, the Agent and
the Hermes Agent entering into the Loan Agreement and making the Loan
available to the Borrower that the Guarantor enters into this Deed.
NOW THIS DEED WITNESSES:
1 DEFINITIONS AND CONSTRUCTION
1.1 In this Deed the following terms and expressions shall have
the meanings set out below; in addition, terms and expressions
not defined herein but whose meanings are defined in the Loan
Agreement shall have the meanings set out therein.
"ACCOUNTS" means the audited consolidated profit and loss
account, cash flow statements and balance sheet (including all
additional information and notes thereto) of the Guarantor and
its consolidated Subsidiaries together with the relative
directors' and auditors' reports;
"BONDS" means bonds in an aggregate amount of at least two
hundred million Dollars (USD200,000,000) and with a life of
ten (10) years but which may be redeemed by the Guarantor at
an earlier date, to be issued by the Guarantor in one (1) or
more tranches, in the first instance to qualified
institutional buyers as unregistered privately placed bonds
and thereafter as bonds registered with the Securities
Exchange Commission of the United States of America;
"EVENT OF DEFAULT" means any of the events specified in clause
11 of the Loan Agreement or specified as such in Clause 11;
and
"OUTSTANDING INDEBTEDNESS" means all sums of any kind payable
actually or contingently to the Beneficiaries under or
pursuant to the Loan Agreement or any Transaction Document
(whether by way of repayment of principal, payment of interest
or default interest, payment of any indemnity or
counter-indemnity, reimbursement for fees, costs or expenses
or otherwise howsoever).
1.2 In this Deed unless the context otherwise requires:
1.2.1 clause headings are inserted for convenience of
reference only and shall be ignored in the
construction of this Deed;
1.2.2 references to Clauses and to Schedules are to be
construed as references to clauses of and schedules
to this Deed unless otherwise stated and references
to this Deed are to be construed as references to
this Deed including its Schedules;
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1.2.3 references to (or to any specified provision of) this
Deed or any other document shall be construed as
references to this Deed, that provision or that
document as from time to time amended, supplemented
or novated;
1.2.4 references to any Act or any statutory instrument
shall be construed as references to that Act or that
statutory instrument as from time to time re-enacted,
amended or supplemented;
1.2.5 references to any party to this Deed or any other
document shall include reference to such party's
successors and permitted assigns;
1.2.6 words importing the plural shall include the singular
and vice versa;
1.2.7 references to a person shall be construed as
references to an individual, firm, company,
corporation, unincorporated body of persons or any
state or any agency thereof; and
1.2.8 where any matter requires the approval or consent of
the Trustee or the Agent such approval or consent
shall not be deemed to have been given unless given
in writing; where any matter is required to be
acceptable to the Trustee or the Agent, the Trustee
or the Agent (as the case may be) shall not be deemed
to have accepted such matter unless its acceptance is
communicated in writing; each of the Trustee and the
Agent may give or withhold its consent, approval or
acceptance at its unfettered discretion.
2 GUARANTEE AND INDEMNITY
2.1 In consideration of the Lenders agreeing at the request of the
Guarantor to make the Loan available to the Borrower in
accordance with the terms of the Loan Agreement, the payment
by the Trustee to the Guarantor of ten Dollars (USD10) and
other good and valuable consideration (the receipt and
adequacy of which the Guarantor hereby acknowledges) the
Guarantor:
2.1.1 as primary obligor as and for its own debt and not
merely as surety hereby undertakes to the Trustee to
be responsible for and hereby guarantees to the
Trustee:
(a) the due and punctual payment by each of the
Obligors to the Trustee or the Agent (on
behalf of the Lenders) (as the case may
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be) (as and when due by acceleration, demand
or otherwise howsoever) of the Outstanding
Indebtedness and every part thereof; and
(b) the due and punctual performance of all the
obligations to be performed by each of the
Obligors and the Builder under or pursuant
to the Loan Agreement and the other Security
Documents; and
2.1.2 unconditionally undertakes immediately on demand by
the Trustee from time to time to pay and/or perform
its obligations under Clause 2.1.1.
2.2 For the same consideration as referred to in Clause 2.1 the
Guarantor (as a separate and independent obligation)
unconditionally undertakes immediately on demand by the
Trustee from time to time to indemnify the Trustee and the
Agent and hold each of them harmless in respect of:
2.2.1 any loss incurred by the Trustee and/or the Agent as
a result of the Loan Agreement and each other
Security Document to which any of the Obligors or the
Builder is a party or any provision thereof becoming
invalid, void, voidable or unenforceable for any
reason whatsoever after execution hereof; and
2.2.2 all loss or damage of any kind arising directly or
indirectly from any failure on the part of any of the
Obligors or the Builder to perform any obligation to
be performed by any of the Obligors or the Builder
under and pursuant to the Loan Agreement and each
other Security Document to which any of the Obligors
or the Builder is a party.
3 SURVIVAL OF GUARANTOR'S LIABILITY
3.1 The Guarantor's liability to the Trustee under this Deed shall
not be discharged, impaired or otherwise affected by reason of
any of the following events or circumstances (regardless of
whether any such events or circumstances occur with or without
the Guarantor's knowledge or consent):
3.1.1 any time, forbearance or other indulgence given or
agreed by the Trustee, the Agent, the Lenders and/or
the Hermes Agent to or with any of the
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Obligors, the Builder or Hermes in respect of any of
their obligations under the Loan Agreement and each
other Security Document to which any of the Obligors,
the Builder or Hermes is a party; or
3.1.2 any legal limitation, disability or incapacity
relating to any of the Obligors, the Builder or
Hermes; or
3.1.3 any invalidity, irregularity, unenforceability,
imperfection or avoidance of or any defect in any
security granted by, or the obligations of any of the
Obligors, the Builder or Hermes under, the Loan
Agreement and each other Security Document to which
any of the Obligors, the Builder or Hermes is a party
or any amendment to or variation thereof or of any
other document or security comprised therein; or
3.1.4 any change in the name, constitution or otherwise of
any of the Obligors, the Builder or Hermes or the
merger of any of the Obligors, the Builder or Hermes
with any other corporate entity; or
3.1.5 the liquidation, bankruptcy or dissolution (or
proceedings analogous thereto) of any of the
Obligors, the Builder or Hermes or the appointment of
a receiver or administrative receiver or
administrator or trustee or similar officer of any of
the assets of any of the Obligors, the Builder or
Hermes or the occurrence of any circumstances
whatsoever affecting any Obligor's, the Builder's or
Hermes' liability to discharge its obligations under
the Loan Agreement and each other Security Document
to which it is a party; or
3.1.6 any challenge, dispute or avoidance by any liquidator
of any of the Obligors, the Builder or Hermes in
respect of any claim by the Guarantor by right of
subrogation in any such liquidation; or
3.1.7 any release of any other Obligor, the Builder or
Hermes or any renewal, exchange or realisation of any
security or obligation provided under or by virtue of
any of the Security Documents or the provision to the
Trustee, the Agent, any of the Lenders or the Hermes
Agent at any time of any further security for the
obligations of the Borrower under any of the Security
Documents; or
5
3.1.8 the release of any co-guarantor and/or indemnitor who
is now or may hereafter become under a joint and
several liability with the Guarantor under this Deed
or the release of any other guarantor, indemnitor or
other third party obligor in respect of the
obligations of any Obligor or the Builder under any
of the Security Documents; or
3.1.9 any failure on the part of the Trustee, the Agent,
any of the Lenders or the Hermes Agent (whether
intentional or not) to take or perfect any security
agreed to be taken under or in relation to any of the
Security Documents or to enforce any of the Security
Documents; or
3.1.10 any other act, matter or thing (save for repayment in
full of the Outstanding Indebtedness) which might
otherwise constitute a legal or equitable discharge
of any of the Guarantor's obligations under this
Deed.
4 CONTINUING GUARANTEE
4.1 This Deed shall be:
4.1.1 a continuing guarantee remaining in full force and
effect until irrevocable payment in full has been
received by the Trustee or the Agent on behalf of the
Beneficiaries of each and every part and the ultimate
balance of the Outstanding Indebtedness in accordance
with the Loan Agreement and each other Security
Document to which any of the Obligors or the Builder
is a party; and
4.1.2 in addition to and not in substitution for or in
derogation of any other security held by the Trustee,
the Agent, any of the Lenders or the Hermes Agent
from time to time in respect of the Outstanding
Indebtedness or any part thereof.
4.2 Any satisfaction of obligations by the Guarantor to the
Trustee or any discharge given by the Trustee to the Guarantor
or any other agreement reached between the Trustee and the
Guarantor in relation to this Deed shall be, and be deemed
always to have been, void ab initio if any act satisfying any
of the said obligations or on the faith of which any such
discharge was given or any such agreement was entered into is
subsequently avoided in whole or in part by or pursuant to any
provision of any applicable law whatsoever.
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4.3 This Deed shall remain the property of the Trustee and,
notwithstanding that all monies and liabilities due or
incurred by any of the Obligors or the Builder to the Trustee
which are guaranteed hereunder shall have been paid or
discharged, the Trustee shall be entitled not to discharge
this Deed or any security held by the Trustee for the
obligations of the Guarantor hereunder for such period as may
in the reasonable opinion of the Trustee be necessary or
appropriate under any applicable insolvency law after the last
of such monies and liabilities have been paid or discharged
and in the event of bankruptcy, winding-up or any similar
proceedings being commenced in respect of any of the Obligors
or the Builder, the Trustee shall be at liberty not to
discharge this Deed or any security held by the Trustee for
the obligations of the Guarantor hereunder for and during such
further period as the Trustee may determine at its sole
discretion.
5 EXCLUSION OF THE GUARANTOR'S RIGHTS
5.1 Until the obligations of any Obligor or the Builder under the
Loan Agreement and each other Security Document to which any
Obligor or the Builder is a party have been fully performed,
the Guarantor shall not:
5.1.1 be entitled to share in or succeed to or benefit from
(by subrogation or otherwise) any rights which the
Trustee may have in respect of the Outstanding
Indebtedness or any security therefor or all or any
of the proceeds of such rights or security; or
5.1.2 without the prior written consent of the Trustee:
(a) exercise in respect of any amount paid by
the Guarantor hereunder any right of
indemnity, subrogation, contribution or any
other right or remedy which it may have in
respect thereof; or
(b) claim payment of any other monies for the
time being due to the Guarantor or to which
it may become entitled or exercise or
enforce or benefit from any other right,
remedy or security in respect thereof; or
(c) prove in a liquidation of any Obligor or the
Builder in competition with the Trustee for
any monies owing to the Guarantor by any
other Obligor or the Builder on any account
whatsoever,
7
PROVIDED ALWAYS that if the Guarantor, in breach of this
Clause, receives or recovers any monies pursuant to any such
exercise, claim or proof, such monies shall be held by the
Guarantor as trustee upon trust for the Trustee to apply the
same as if they were monies received or recovered by the
Trustee under this Deed.
6 PAYMENTS
6.1 Each payment to be made by the Guarantor hereunder shall be
made in immediately available funds in the currency in which
such payment is due without set-off, counterclaim, deduction
or retention of any kind by payment to such account of the
Trustee with such bank or financial institution as the Trustee
may from time to time notify to the Guarantor in writing.
If the Guarantor is required by law to make such a payment
subject to the deduction or withholding of Taxes, in which
case the sum payable by the Guarantor in respect of which such
deduction or withholding is required to be made shall be
increased to the extent necessary to ensure that, after the
making of such deduction or withholding, the Trustee receives
and retains (free from any liability in respect of any such
deduction or withholding) a net sum equal to the sum which it
would have received and so retained had no such deduction or
withholding been made or required to be made.
6.2 Without prejudice to the provisions of Clause 6.1, if any
Lender or the Agent or the Trustee on the Lender's behalf is
required to make any payment on account of Tax (not being a
tax imposed on the net income of its Office by the
jurisdiction in which it is incorporated or in which its
Office is located or any other tax existing and applicable on
the date of this Deed under the laws of any jurisdiction) on
or in relation to any sum received or receivable hereunder by
such Lender or the Agent or the Trustee on the Lender's behalf
(including, without limitation, any sum received or receivable
under this Clause 6) or any liability in respect of any such
payment is asserted, imposed, levied or assessed against such
Lender or the Agent or the Trustee on the Lender's behalf, the
Guarantor shall, upon demand of the Agent, indemnify such
Lender or the Agent or the Trustee against such payment or
liability, together with any interest, penalties and expenses
payable or incurred in connection therewith, other than
interest, penalties, and expenses:
8
6.2.1 that accrue during any periods of time beginning on
the thirty first (31st) day (or such longer period as
any Lender may reasonably require) following the day
on which the Lender or the Agent or the Trustee, as
applicable, has actual knowledge of the imposition or
assertion of such Taxes or other Taxes; or
6.2.2 that are otherwise imposed or asserted on account of
the bad faith or wilful neglect of such Lender or the
Agent or the Trustee.
If any Lender proposes to make a claim under the provisions of
this Clause 6.2 it shall certify to the Guarantor in
reasonable detail within thirty (30) days (or such longer
period as any Lender may reasonably require) after becoming
aware of the event by reason of which it is entitled to make
its claim or claims the basis of its claim or claims, such
certificate to be conclusive, save for manifest error.
Without affecting the Guarantor's obligations under Clause 6.1
and in consultation with the Agent, the affected Lender will
then take all such reasonable steps as may be open to it to
mitigate the effect of the event (for example (if then
possible) by changing its Office or transferring some or all
of its rights and obligations under the Loan Agreement to
another financial institution reasonably acceptable to the
Borrower, the Guarantor, the Hermes Agent and the Agent). The
reasonable costs of mitigating the effect of any such change
shall be borne by the Guarantor save where such costs are of
an internal administrative nature and are not incurred in
dealings by any Lender with third parties.
6.3 No person to which a Lender assigns part or all of its
interest under this Deed pursuant to clause 17 of the Loan
Agreement shall be entitled to receive any greater increase in
payment under Clause 6.1 than the assigning Lender would have
been entitled to receive with respect to the rights assigned
unless such assignment shall have been made at a time when the
circumstances giving rise to such greater payment did not
exist and were not reasonably anticipated or reasonably
foreseeable.
6.4 The certificate of the Trustee from time to time as to sums
owed by any Obligor or the Builder under the Security
Documents and sums owed by the Guarantor hereunder shall, save
for manifest error, be conclusive and binding for all
9
purposes and prima facie evidence of the existence and extent
of such debts in any legal action or proceedings arising in
connection herewith.
6.5 The provisions of Clause 7.3 of the Loan Agreement shall apply
hereto (mutatis mutandis) as if set out in full herein.
7 ENFORCEMENT
7.1 The Trustee shall not be obliged before taking steps to
enforce this Deed to take any action whatsoever against any of
the Obligors, the Builder or Hermes under the Loan Agreement
or any other Security Documents to which they are a party and
the Guarantor hereby waives all such formalities or rights to
which it would otherwise be entitled or which the Trustee
would otherwise first be required to satisfy or fulfil before
proceeding or making demand against the Guarantor hereunder
provided that the Trustee shall not be entitled to enforce its
rights under this Deed otherwise than in circumstances which
would constitute an Event of Default.
8 REPRESENTATIONS AND WARRANTIES
8.1 The Guarantor represents and warrants to the Trustee that:
8.1.1 it is a limited liability exempt company, duly
incorporated and validly existing under the laws of
Bermuda, possessing perpetual corporate existence,
the capacity to xxx and be sued in its own name and
the power to own its assets and carry on its business
as it is now being conducted;
8.1.2 it has the power to enter into and perform this Deed
and all necessary corporate or other action has been
taken to authorise the entry into and performance of
this Deed;
8.1.3 this Deed constitutes its legal, valid and binding
obligations enforceable in accordance with its terms;
8.1.4 the entry into and performance of this Deed and the
transactions contemplated hereby do not and will not
be a breach of or conflict with:
(a) any law or regulation or any official or
judicial order; or
10
(b) its constitutional documents; or
(c) any agreement or document to which it is a
party or which is binding upon it or any of
its assets,
nor result in the creation or imposition of any
Encumbrance on any of its assets pursuant to the
provisions of any such agreement or document;
8.1.5 no event has occurred and is continuing which
constitutes a default under or in respect of any
agreement or document to which the Guarantor is a
party or by which it may be bound (including, inter
alia, this Deed) and no event has occurred which,
with the giving of notice, lapse of time,
determination of materiality or other condition would
or might constitute a default under or in respect of
any such agreement or document;
8.1.6 all authorisations, approvals, consents, licences,
exemptions, filings, registrations, notarisations and
other matters, official or otherwise, required in
connection with the entry into, performance, validity
and enforceability of this Deed and the transactions
contemplated hereby have been obtained or effected
and are in full force and effect;
8.1.7 all information furnished by or on behalf of the
Guarantor relating to the business and affairs of any
member of the NCLC Group in connection with this Deed
was and remains true and correct in all material
respects and there are no other material facts or
considerations the omission of which would render any
such information misleading;
8.1.8 the Guarantor has fully disclosed in writing to the
Lenders through the Agent all facts relating to the
NCLC Group which it knows or should reasonably know
and which might reasonably be expected to influence
the Lenders in deciding whether or not to enter into
the Loan Agreement;
8.1.9 the Accounts for the financial year ended 31 December
2004 (which accounts will be prepared in accordance
with GAAP) will fairly represent the consolidated
financial condition of the NCLC Group as at 31
December 2004 and from that date there will be no
material adverse change in the consolidated financial
condition of the NCLC Group as shown in such audited
accounts save as disclosed in writing to the Agent
11
(in this Clause 8.1.9 "NCLC GROUP" shall have the
meaning ascribed to it in Clause 11.4);
8.1.10 the claims of the Trustee against the Guarantor under
this Deed will rank at least pari passu with the
claims of all other unsecured creditors of the
Guarantor other than claims of such creditors to the
extent that the same are statutorily preferred;
8.1.11 no member of the NCLC Group has taken any corporate
action nor have any other steps been taken or legal
proceedings been started or (to the best of the
Guarantor's knowledge and belief) threatened against
any member of the NCLC Group for its winding-up or
dissolution or for the appointment of a liquidator,
administrator, receiver, administrative receiver,
trustee or similar officer of it or any or all of its
assets or revenues nor has any member of the NCLC
Group sought any other relief under any applicable
insolvency or bankruptcy law;
8.1.12 no litigation, arbitration or administrative
proceedings are current or pending or (to the best of
the Guarantor's knowledge and belief) threatened,
which might, if adversely determined, have a material
adverse effect on the business, assets or financial
condition of the Guarantor or any other member of the
NCLC Group;
8.1.13 each member of the NCLC Group has complied with all
taxation laws in all jurisdictions in which it is
subject to Taxation and has paid all Taxes due and
payable by it; no material claims are being asserted
against any member of the NCLC Group with respect to
Taxes which might, if such claims were successful,
have a material adverse effect on its business,
assets or financial condition;
8.1.14 neither the Guarantor nor any of its assets enjoys
any right of immunity from set-off, suit or execution
in respect of its obligations under this Deed;
8.1.15 all amounts payable by the Guarantor hereunder may be
made free and clear of and without deduction for or
on account of any Taxes;
12
8.1.16 the Shares and all the shares in the Manager are
legally and beneficially owned by the Shareholder,
all the shares in the Sub-Agent are legally and
beneficially owned by NCL International, all the
shares in the Shareholder are legally and
beneficially owned by Arrasas, all the shares in
Arrasas are legally and beneficially owned by the
Guarantor and all the shares in the Supervisor are
legally and beneficially owned by Star and such
structure shall remain so throughout the Security
Period. Further, no Event of Default has occurred
under Clause 11.2 in respect of the ownership and/or
control of the shares in the Guarantor;
8.1.17 the Guarantor does not have a place of business in
any jurisdiction which would require this Deed to be
filed or registered (if it had a place of business in
that jurisdiction) to ensure the validity of this
Deed; and
8.1.18 it has reviewed and agrees to all the terms and
conditions of the Loan Agreement and each other
Security Document to which any Obligor or the Builder
is a party.
8.2 The representations and warranties set out in Clause 8.1 other
than those set out in Clauses 8.1.4(a), 8.1.8, 8.1.15 and
8.1.18 shall survive the execution of this Deed and shall be
deemed to be repeated, with reference mutatis mutandis to the
facts and circumstances then subsisting, on each day until the
actual and contingent obligations of each Obligor or the
Builder have been performed in full.
9 GENERAL UNDERTAKINGS: POSITIVE COVENANTS
9.1 The undertakings contained in this Clause 9 shall remain in
full force from the date of this Deed until the end of the
Security Period.
9.2 The Guarantor will provide to the Agent:
9.2.1 as soon as practicable (and in any event within one
hundred and twenty (120) days after the close of each
of its financial years) a Certified Copy of its
Accounts (commencing with the audited accounts made
up to 31 December 2004);
9.2.2 as soon as practicable (and in any event within forty
five (45) days after the close of each quarter of
each financial year) a Certified Copy of the
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unaudited consolidated accounts of the NCLC Group for
that quarter (commencing with the unaudited accounts
made up to 31 March 2004);
9.2.3 as soon as practicable (and in any event within
thirty (30) days after the close of each quarter of
each financial year), beginning with the quarter
ending 31 March 2004, monthly cash flow projections
on a consolidated basis of the NCLC Group showing
advance ticket sales (for at least twelve (12) months
following the date of such statement) for the NCLC
Group, together with a certificate of the NCLC
Group's chief operating officer or senior vice
president - finance stating that no Event of Default
or Possible Event of Default has occurred and is
continuing, or setting forth in detail any such Event
of Default or Possible Event of Default and any steps
being taken by the Guarantor or any other Obligor to
cure the same;
9.2.4 as soon as practicable (and in any event not later
than 31 January of each financial year):
(a) a budget for the NCLC Group for such new
financial year including a twelve (12) month
liquidity budget for such new financial
year; and
(b) updated financial projections of the NCLC
Group for at least the next five (5) years
(including an income statement and projected
results for the operation of the vessels
owned and/or operated by any member of the
NCLC Group) and an outline of the
assumptions supporting such budget and
financial projections and details of any
scheduled dry-docking of any of the vessels
owned and/or operated by companies in the
NCLC Group during such new financial year;
9.2.5 from time to time (but at intervals no more
frequently than semi-annually at the Guarantor's
expense) within fifteen (15) days of receiving any
request to that effect from the Agent, a valuation of
each of the vessels in the NCLC Fleet obtained in
accordance with the provisions of clause 10.18 of the
Loan Agreement;
14
9.2.6 as soon as practicable (and in any event within forty
five (45) days after the close of each quarter of its
financial year) a statement signed by the NCLC
Group's chief financial officer in the form of
Schedule 1 (commencing with the first quarter of the
financial year ending 31 December 2004);
9.2.7 promptly, such further information in its possession
or control regarding its financial condition and
operations and those of any company in the NCLC Group
as the Agent may request;
9.2.8 details of any material litigation, arbitration or
administrative proceedings which affect any Obligor
as soon as the same are instituted and served, or, to
the knowledge of the Guarantor, threatened (and for
this purpose proceedings shall be deemed to be
material if they involve a claim in an amount
exceeding five million Dollars (USD5,000,000) or the
equivalent in another currency); and
9.2.9 promptly, such information as the Agent may request
regarding the Bonds, either before their issue or
during their lifetime.
All accounts required under this Clause 9.2 shall be prepared
in accordance with GAAP and shall fairly represent the
financial condition of the relevant company. In this Clause
9.2 "NCLC GROUP" shall have the meaning ascribed to it in
Clause 11.4.
9.3 Subject to the provisions of Clause 11.3, the Guarantor will
procure that any dividends or other distributions and interest
paid or payable in connection therewith received by the
Shareholder will be paid to the Guarantor by way of dividend
promptly on receipt.
9.4 The Guarantor will keep proper books of record and account in
which proper and correct entries shall be made of all
financial transactions and the assets, liabilities and
business of the Guarantor in accordance with GAAP.
9.5 The Guarantor will notify the Trustee and the Agent of any
Event of Default or Possible Event of Default forthwith upon
the Guarantor becoming aware of the occurrence thereof.
15
9.6 The Guarantor will procure that all such authorisations,
approvals, consents, licences and exemptions as may be
required under any applicable law or regulation to enable it
to perform its obligations under, and ensure the validity or
enforceability of, this Deed are obtained and promptly renewed
from time to time and will promptly furnish certified copies
thereof to the Agent and will procure that the terms of the
same are complied with at all times.
9.7 The Guarantor will do all such things as are necessary to
maintain its corporate existence in good standing and will
ensure that it has the right and is duly qualified to conduct
its business as it is conducted in all applicable
jurisdictions and will obtain and maintain all franchises and
rights necessary for the conduct of its business.
9.8 Forthwith upon the execution of this Deed, and as a condition
precedent to the Lenders entering into the Loan Agreement, the
Guarantor shall deliver to the Agent a letter addressed to the
Agent irrevocably and unconditionally authorising and
instructing the Agent forthwith to execute on behalf of the
Guarantor each Transfer Certificate delivered to the Agent
pursuant to clause 17 of the Loan Agreement, such letter to be
in substantially the form of Schedule 2.
10 GENERAL UNDERTAKINGS: NEGATIVE COVENANTS
10.1 The undertakings contained in this Clause 10 shall remain in
full force from the date of this Deed until the end of the
Security Period.
10.2 Except with the prior written consent of the Agent, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, either in a single transaction or in a
series of transactions whether related or not and whether
voluntarily or involuntarily, agree to or actually sell,
assign, abandon or otherwise transfer or dispose of all or any
of its assets or any share or interest therein except that:
10.2.1 the Borrower may agree to sell the Vessel on the
condition that contemporaneously with the completion
of the sale the Loan is prepaid in accordance with
the provisions of clause 4.6 of the Loan Agreement;
10.2.2 the Borrower may let the Vessel on charter in
accordance with the provisions of clause 10 of the
Loan Agreement;
16
10.2.3 disposals may be made in the ordinary course of
trading of the disposing entity (excluding disposal
of ships) including without limitation, the payment
of cash as consideration for the purchase or
acquisition of any asset or service or in the
discharge of any obligation incurred for value in the
ordinary course of trading;
10.2.4 disposals of cash raised or borrowed may be made for
the purposes for which such cash was raised or
borrowed;
10.2.5 disposals of assets in exchange for other assets
comparable or superior as to type and value may be
made;
10.2.6 a vessel owned by any member of the NCLC Group (other
than the Borrower) may be sold provided such sale is
on a willing seller willing buyer basis at or about
market rate and at arm's length subject always to the
provisions of any loan documentation for the
financing of such vessel and NCLL may, following the
sale of its shares by Arrasas to IOL, a wholly owned
Subsidiary of Star, transfer to other wholly owned
Subsidiaries of Star its vessels "NORWEGIAN WIND",
"NORWEGIAN DREAM", "NORWEGIAN SEA", "NORWEGIAN
MAJESTY", "NORWEGIAN CROWN" and "XXXXX XXXX" (the
"SIX VESSELS") for their transfer values as set out
in schedule 8 to the Loan Agreement and sell m.v.
"NORWAY" to a third party and, prior to the sale of
its shares as aforesaid, transfer its vessel
"NORWEGIAN SKY" to Pride of Aloha Inc., a wholly
owned Subsidiary of the Shareholder;
10.2.7 the Shareholder may assign, pledge or charge the
Shares as security for the obligations of the
Borrower under the Loan Agreement; and
10.2.8 Arrasas may transfer its shares in NCLL to IOL and
Star may transfer its shares in Arrasas to the
Guarantor.
10.3 Except with the prior written consent of the Agent, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, make any loan or advance or extend credit
to any person, firm or corporation (except any loan, advance
or credit made available to passengers on board a vessel for
gambling purposes or to ship's agents and except any loan,
advance or credit to the
17
Guarantor or a wholly-owned Subsidiary of the Guarantor, which
loan, advance or credit is fully subordinated to the rights of
the Beneficiaries under the Security Documents).
10.4 The Guarantor will not, and will procure that no other member
of the NCLC Group will, issue or enter into any one (1) or
more guarantee or indemnity or otherwise become directly or
contingently liable for the obligations of any other person,
firm or corporation without first notifying the Agent with
full details of the amount(s) and the period(s) of the
guarantee(s) or indemnity(ies), if such is or are in excess of
(in aggregate (if applicable)) the amount of twenty million
Dollars (USD20,000,000).
10.5 Except with the prior written consent of the Agent, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, make or threaten to make any substantial
change in its business as presently conducted, or carry on any
other business which is substantial in relation to its
business as presently conducted so as to affect, in the
opinion of the Agent, the ability of the Guarantor or any
other Obligor to perform its obligations under the Security
Documents to which it is a party PROVIDED THAT any new leisure
or hospitality venture embarked upon by any member of the NCLC
Group (other than the Borrower) shall not constitute a
substantial change in its business and PROVIDED THAT NCLL may
transfer the Six Vessels (as defined in Clause 10.2.6) to
wholly owned Subsidiaries of Star and m.v. "NORWEGIAN SKY" to
Pride of Aloha Inc., a wholly owned Subsidiary of the
Shareholder as aforesaid, sell m.v. "NORWAY" to a third party,
cease to be either an owner or manager of ships and conduct
such business as is contemplated by the restructure and
recapitalisation of the Group as more particularly described
in the letter dated 19 December 2003 from NCLL to the Agent
and the Hermes Agent.
10.6 Except with the prior written consent of the Agent, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, enter into any amalgamation, merger or
consolidation or anything analogous to the foregoing. However,
the prior consent of the Agent shall not be required in
respect of any consolidation, reorganisation or restructure
involving wholly owned (whether directly or indirectly)
Subsidiaries of the Guarantor only which does not imperil the
security created by any of the Security Documents or affect
the ability of any
18
Obligor duly to perform any of its obligations under any
Security Document to which it may be a party at any time,
provided that the Guarantor has first consulted with the Agent
with regard to the proposed consolidation, reorganisation or
restructure and provides evidence satisfactory to the Agent
that the Guarantor will be in compliance with the financial
undertakings contained in Clause 11 after any such
consolidation, reorganisation or restructure. Further, no
member of the NCLC Group will acquire any equity, share
capital or obligations of any corporation or other entity
PROVIDED THAT NCL International or the Shareholder may so
acquire equity, share capital or obligations or a corporation
or entity whose business is the ownership, operation or
management of cruise vessels and PROVIDED FURTHER THAT:
10.6.1 Arrasas may form two (2) wholly owned Subsidiaries,
namely NCL International and the Shareholder;
10.6.2 the existing shareholders of the owners of the
Bahamas flag vessels in the NCLC Fleet may transfer
their shares in such owners to NCL International;
10.6.3 the existing shareholders of the owners of the US
flag vessels in the NCLC Fleet may transfer their
shares in such owners to the Shareholder;
10.6.4 NCL International may form a wholly owned Subsidiary,
namely the Sub-Agent, to operate the Bahamas flag
vessels in the NCLC Fleet and to charter in each of
the Six Vessels (as defined in Clause 10.2.6) on
demise or bareboat charter for the period and at the
charterhire rate set out in schedule 8 to the Loan
Agreement; and
10.6.5 the Shareholder may form two (2) wholly owned
Subsidiaries, namely the Manager, to operate the US
flag vessels in the NCLC Fleet and Pride of Aloha
Inc., to own m.v. "NORWEGIAN SKY".
However, for the avoidance of doubt, the acquisition by a
member of the NCLC Group of any shares in any company or
corporation shall not in itself constitute a merger or
consolidation with such company or corporation for the purpose
of this Clause 10.6 provided that the Agent is satisfied the
Guarantor will be in
19
compliance with the financial undertakings contained in Clause
11 after any such merger or consolidation.
10.6.6 Except with the prior written consent of the Agent, the
Guarantor will not alter its financial year end.
10.6.7 The Guarantor has not taken and shall not take from any other
Obligor or the Builder any security or counter-security in
respect of any of its obligations under this Deed PROVIDED
ALWAYS that if the Guarantor, in breach of this Clause, takes
any security or counter-security as aforesaid, such security
shall be held by the Guarantor as trustee upon trust for the
Trustee.
11 FINANCIAL UNDERTAKINGS AND OWNERSHIP AND CONTROL OF THE GUARANTOR
11.1 The Guarantor will ensure that:
11.1.1 at all times the minimum Cash Balance will be not
less than fifty million Dollars (USD50,000,000);
11.1.2 as at 31 December 2004 and as at the end of each
subsequent financial quarter either:
(a) the ratio of Consolidated EBITDA to
Consolidated Debt Service for the NCLC Group
for the period of twelve (12) months ending
as at the end of the relevant financial
quarter shall not be less than:
(i) for the financial quarter ending on
31 December 2004, one point two
(1.2) to one (1.0); and
(ii) for each subsequent financial
quarter, one point two five (1.25)
to one (1.0); or
(b) the NCLC Group has maintained a minimum Cash
Balance during such period of twelve (12)
months ending as at the end of the relevant
financial quarter in an amount which is not
less than whichever is the greater of:
(i) one hundred million Dollars
(USD100,000,000); and
20
(ii) seven point five per cent (7.5%) of
Total Funded Debt as at the end of
the relevant financial quarter and
each of the three (3) preceding
financial quarters; and
11.1.3 as at 31 December 2004 and as at the end of each
subsequent financial quarter, the ratio of Total Net
Funded Debt to Total Capitalisation of the NCLC Group
shall not exceed:
(a) nought point seven (0.7) to one (1.0) for
financial quarters ending on or before 31
December 2006; and
(b) nought point six five (0.65) to one (1.0)
for each subsequent financial quarter.
Amounts available for drawing under any revolving or
other credit facilities of the NCLC Group which
remain undrawn at the time of the relevant
calculation shall not be counted as cash or
indebtedness for the purposes of this ratio.
11.2 It will be an Event of Default if:
11.2.1 at any time when the ordinary share capital of the
Guarantor is not publicly listed on an Approved Stock
Exchange, the Lim Family together or individually do
not, directly or indirectly, control the Guarantor
and beneficially own, directly or indirectly, at
least fifty one per cent (51%) of the issued share
capital of, and equity interest in, the Guarantor; or
11.2.2 at any time following the listing of the ordinary
share capital of the Guarantor on an Approved Stock
Exchange:
(a) any Third Party:
(i) owns more than thirty three per
cent (33%) of the ordinary share
capital of the Guarantor; or
(ii) owns shares in the ordinary share
capital of the Guarantor
representing more than thirty three
per cent (33%) of all the voting
rights attributable to such
ordinary share capital; or
21
(iii) gains control of more than thirty
three per cent (33%) of such voting
rights
and, at the same time as any of the events
described in paragraphs (i), (ii) or (iii)
of this Clause have occurred and are
continuing, the Lim Family together or
individually do not, directly or indirectly,
control the Guarantor and beneficially own,
directly or indirectly, at least fifty one
per cent (51%) of the issued share capital
of, and equity interest in, the Guarantor;
or
(b) the Guarantor ceases to be a listed company
on an Approved Stock Exchange without the
prior written consent of the Agent,
(and, for the purpose of this Clause 11.2.2 "CONTROL"
of any company, limited partnership or other legal
entity (a "BODY CORPORATE") by a member of the Lim
Family, means that one (1) or more members of the Lim
Family has, directly or indirectly, the power to
direct the management and policies of such a body
corporate, whether through the ownership of more than
fifty per cent (50%) of the issued voting capital of
that body corporate or by contract, trust or other
arrangement).
11.3 During any financial year of the Guarantor until the date on
which the Guarantor becomes a listed company on an Approved
Stock Exchange (on which date the restriction contained in
this Clause 11.3 shall cease to apply), the Guarantor shall
not and shall procure that no other member of the NCLC Group
shall, pay any dividends or make any other distributions in
respect of its share capital to any person or make any
repayments of capital or payments of interest in respect of
Financial Indebtedness to an Affiliate of the Guarantor (other
than to the Guarantor and/or its wholly owned Subsidiaries)
which during any financial year of the Guarantor in aggregate
exceeds fifty per cent (50%) of the Consolidated Net Income
(if positive) of the NCLC Group for such financial year,
PROVIDED HOWEVER THAT the NCLC Group shall not be entitled to
pay any dividend or make any distribution in respect of any of
its share capital or make any repayments of capital or
payments of interest if an Event of Default has occurred and
is continuing or would occur as a result of the payment of
such dividend or the making of such distribution.
22
11.4 In Clause 11.1, Clause 11.2, Clause 11.3 and Schedule 1:
11.4.1 "AFFILIATE" means, with respect to any person, any
other person controlling, controlled by or under
common control with, such person and for purposes of
this definition, "CONTROL" (including, with
correlative meanings, the terms "CONTROLLING",
"CONTROLLED BY" and "UNDER COMMON CONTROL WITH"), as
applied to any person, means the possession, directly
or indirectly, of the power to vote ten per cent
(10%) or more of the securities having voting power
for the election of directors of such person, or
otherwise to direct or cause the direction of the
management and policies of that person, whether
through the ownership of voting securities or by
contract or otherwise;
11.4.2 "APPROVED STOCK EXCHANGE" means the New York Stock
Exchange, NASDAQ or such other stock exchange in the
United States of America as is approved in writing by
the Agent;
11.4.3 "CASH BALANCE" means the unencumbered and otherwise
unrestricted cash and cash equivalents as set forth
on the consolidated balance sheet of the NCLC Group
prepared in accordance with GAAP at the end of every
month;
11.4.4 "CONSOLIDATED DEBT SERVICE" means, for any relevant
period, the sum (without double counting), determined
in accordance with GAAP, of:
(a) the aggregate principal payable or paid
during such period on any Indebtedness for
Borrowed Money of any member of the NCLC
Group, other than:
(i) principal of any such Indebtedness
for Borrowed Money prepaid at the
option of the relevant member of
the NCLC Group;
(ii) principal of any such Indebtedness
for Borrowed Money prepaid upon the
sale or Total Loss of any vessel
owned or leased under a capital
lease by any member of the NCLC
Group; and
23
(iii) balloon payments of any such
Indebtedness for Borrowed Money
payable during such period (and for
the purpose of this paragraph (iii)
a "BALLOON PAYMENT" shall not
include any scheduled repayment
instalment of such Indebtedness for
Borrowed Money which forms part of
the balloon);
(b) Consolidated Interest Expense for such
period;
(c) the aggregate amount of any dividend or
distribution of present or future assets,
undertakings, rights or revenues to any
shareholder of any member of the NCLC Group
(other than the Guarantor or one of its
wholly owned Subsidiaries) or any
distribution in respect of share capital
during such period ("DISTRIBUTIONS"); and
(d) all rent under any capital lease obligations
by which the Guarantor or any consolidated
Subsidiary is bound which are payable or
paid during such period and the portion of
any debt discount that must be amortised in
such period,
as calculated in accordance with GAAP and derived
from the then latest unaudited consolidated accounts
of the NCLC Group delivered to the Agent in the case
of any period ending at the end of any of the first
three (3) financial quarters of each financial year
of the Guarantor and the then latest Accounts
delivered to the Agent in the case of the final
quarter of each such financial year;
11.4.5 "CONSOLIDATED EBITDA" means, for any relevant period,
the aggregate of:
(a) Consolidated Net Income (but excluding (i)
gains and losses from the sale of assets or
reserves relating thereto and (ii) items
classified as extraordinary or non
recurring) from the Guarantor's operations
for such period;
(b) the aggregate amounts deducted in
determining Consolidated Net Income for such
period in respect of depreciation,
amortisation, deferred income tax expense
and any other non-cash charges for such
period and Consolidated Interest Expense;
24
11.4.6 "CONSOLIDATED INTEREST EXPENSE" means, for any
relevant period, the consolidated interest expense
(excluding capitalised interest accrued and not
payable during such period) of the NCLC Group for
such period;
11.4.7 "CONSOLIDATED NET INCOME" means, for any relevant
period, the consolidated net income (or loss) of the
NCLC Group for such period as determined in
accordance with GAAP;
11.4.8 "INTANGIBLE ASSETS" means, at any date of
determination, the amounts (to the extent reflected
in determining at such date consolidated
stockholders' equity of the NCLC Group) determined in
accordance with GAAP of:
(a) all shareholdings other than any
shareholdings of shares which are publicly
quoted and which are not subject to any
restrictions on sale or other disposition
thereof;
(b) treasury stock (to the extent not deducted
in the determination of consolidated
stockholders' equity of the NCLC Group); and
(c) all unamortised debt discount and expenses,
unamortised deferred charges, goodwill,
patents, trademarks, service marks, trade
names, copyrights, organisational or
development expenses and other intangible
items,
all as calculated in accordance with GAAP and derived
from the then latest unaudited and consolidated
accounts of the NCLC Group delivered to the Agent in
the case of the first three (3) quarters of each
financial year and the then latest Accounts delivered
to the Agent in the case of the final quarter of each
financial year;
11.4.9 "LIM FAMILY" means:
(a) Tan Sri Lim Goh Tong;
(b) his spouse;
(c) his direct lineal descendants;
(d) the personal estate of any of the above
persons; and
25
(e) any trust created for the benefit of one or
more of the above persons and their estates;
11.4.10 "NCLC GROUP" means, for the purposes of this Clause
11, the Guarantor, its Subsidiaries and any other
entity which is required to be consolidated in the
Guarantor's accounts in accordance with GAAP;
11.4.11 "TANGIBLE ASSETS" means, at any date of
determination, the total assets of the NCLC Group (as
stated in the then latest unaudited and consolidated
accounts of the Guarantor delivered to the Agent)
less the Intangible Assets of the NCLC Group at such
date;
11.4.12 "TANGIBLE NET WORTH" means, at any date of
determination, the consolidated stockholders' equity
of the NCLC Group at such date determined in
accordance with GAAP less:
(a) Intangible Assets of the NCLC Group; and
(b) (to the extent included) any amount set
aside for taxation, deferred taxation or (to
the extent that the full amount receivable
in respect of any bad debts is shown in the
balance sheet as an asset of the NCLC Group)
bad debts,
at such date all as calculated in accordance with
GAAP and derived from the then latest unaudited and
consolidated accounts of the NCLC Group delivered to
the Agent in the case of the first three (3) quarters
of each financial year and the then latest Accounts
delivered to the Agent in the case of the final
quarter of each financial year;
11.4.13 "THIRD PARTY" means any person or group of persons
acting in concert (as the expression "ACTING IN
CONCERT" is defined in the City Code on Take-overs
and Mergers) who or which is not a member of the Lim
Family;
11.4.14 "TOTAL CAPITALISATION" means, as at any relevant
date, Total Funded Debt plus Tangible Net Worth as at
such date;
11.4.15 "TOTAL FUNDED DEBT" means, as at any relevant date:
26
(a) Indebtedness for Borrowed Money of the NCLC
Group; and
(b) the amount of any Indebtedness for Borrowed
Money of any person which is not a member of
the NCLC Group but which is guaranteed by a
member of the NCLC Group as at such date;
11.4.16 "TOTAL NET FUNDED DEBT" means, as at any relevant
date, the Total Funded Debt less an amount equal to
any Cash Balance as at such date in excess of fifty
million Dollars (USD50,000,000).
11.5 Save as specified in Clause 11.1.2, the ratios referred to in
Clause 11.1 will be measured on a quarterly basis by reference
to the consolidated accounts of the NCLC Group.
12 ISSUE OF THE BONDS
12.1 On behalf of the Lenders the Trustee hereby consents to the
issue of the Bonds at any time after the date hereof PROVIDED
THAT any claims of the holders of the Bonds against the
Guarantor will not rank prior to the claims of all other
unsecured creditors of the Guarantor and in particular the
Lenders (other than claims of such creditors to the extent
that they are statutorily preferred).
13 DISCHARGE
13.1 Subject to Clause 4.3, following the irrevocable repayment or
payment to the Trustee or the Agent on behalf of the
Beneficiaries of all the Outstanding Indebtedness the Trustee
will at the Guarantor's request return this Deed to the
Guarantor and shall, at the request and cost of the Guarantor,
transfer to the Guarantor such rights as the Trustee may at
such time have in the security for the Outstanding
Indebtedness and to the proceeds of any such rights or
security.
14 ASSIGNMENT AND TRANSFER
14.1 This Deed shall be binding upon and enure to the benefit of
the Trustee and its successors and assigns.
14.2 The Guarantor shall not be entitled to assign or transfer all
or any part of its rights, benefits or obligations under this
Deed.
27
14.3 The Trustee may transfer its rights hereunder to any person to
whom its rights and obligations under the Agency and Trust
Deed are transferred in accordance with the Agency and Trust
Deed.
14.4 Any Beneficiary may disclose to any actual or potential
assignee or Transferee or to any person who may otherwise
enter or propose to enter into contractual relations with such
Beneficiary in relation to the Loan Agreement and this Deed
any information about the Obligors and the NCLC Group as such
Beneficiary shall reasonably consider necessary for the
purposes of inviting expressions of interest from other banks
or financial institutions SUBJECT ALWAYS to the relevant
Beneficiary procuring the execution by the potential assignee
or Transferee or any other person as aforesaid of a
Confidentiality Undertaking.
14.5 A person (including any body of persons) who is not a party to
this Deed has no right under the Contracts (Rights of Third
Parties) Xxx 0000 to enforce any term of this Deed but this
does not affect any right or remedy of a third party which
exists or is available apart from that Act.
15 MISCELLANEOUS PROVISIONS
15.1 No failure to exercise and no delay in exercising on the part
of the Trustee or any of the other Beneficiaries any right or
remedy under this Deed or under any other of the Security
Documents shall operate as a waiver thereof, nor shall any
single or partial exercise of any right or remedy preclude any
other or further exercise thereof or the exercise of any other
right or remedy. No waiver by the Trustee or any of the other
Beneficiaries shall be effective unless it is in writing.
15.2 The rights and remedies of the Beneficiaries provided herein
and in the other Security Documents are cumulative and not
exclusive of any rights or remedies provided by law.
15.3 If any provision of this Deed or the Loan Agreement or any
other Security Document to which any Obligor or the Builder is
a party is prohibited or unenforceable in any jurisdiction,
such prohibition or unenforceability shall not invalidate the
remaining provisions hereof or thereof or affect the validity
or enforceability of such provision in any other jurisdiction.
28
15.4 Time is of the essence in respect of all of the obligations of
the Guarantor under this Deed.
16 WAIVER OF IMMUNITY
16.1 The Guarantor irrevocably and unconditionally:
16.1.1 waives any right of immunity which it or its assets
now has or may hereafter acquire in relation to any
legal proceedings (including, but without limitation,
actions in rem and/or in personam) brought against it
or its assets by the Trustee in relation to this
Deed; and
16.1.2 consents generally in respect of any such proceedings
to the giving of any relief including, without
limitation, the issue of any process in connection
with such proceedings and the making, enforcement or
execution against any property whatsoever
(irrespective of its use or intended use) of any
order or judgment which may be made or given in such
proceedings.
17 NOTICES
17.1 Each notice, demand or other communication to be made under
this Deed shall be made in writing which, unless otherwise
stated, includes telefax.
17.2 Any notice, demand or other communication to be made or
delivered by the Trustee to the Guarantor pursuant to this
Deed shall (unless the Guarantor has by fifteen (15) days'
written notice to the Trustee specified another address) be
made or delivered to the Guarantor at 0000 Xxxxxxxxxxx Xxxxxx
Xxxxx, Xxxxx, Xxxxxxx 00000, Xxxxxx Xxxxxx of America marked
for the attention of Xx Xxxxxx Cooler (telefax no. x0 000 000
4117) and the Legal Department (telefax no. x0 000 000 0000)
with a copy to the Guarantor at 25th Floor, Wisma Genting,
Xxxxx Xxxxxx Xxxxxx, 00000 Xxxxx Xxxxxx, Xxxxxxxx marked for
the attention of Xx Xxxxxx Xxx (telefax no. +60 (0)3 2161
3621) and shall be deemed to have been made or delivered (in
the case of telefax) when transmission of such telefax
communication has been completed or (in the case of any
letter) when delivered to the aforesaid address or (as the
case may be) five (5) days after being deposited in the post
first class postage prepaid in an envelope addressed to it at
that address. Any notice, demand or other communication to be
made or delivered by the Guarantor to the Trustee or the Agent
pursuant to this Deed shall (unless the
29
Trustee or the Agent (as the case may be) have by fifteen (15)
days' written notice to the Guarantor specified another
address) be made or delivered to the Trustee or the Agent at
its office for the time being which is at present at HSBC Bank
plc, Project and Export Finance, 0 Xxxxxx Xxxxxx, Xxxxxx X00
0XX, Xxxxxxx marked for the attention of Mr Xxxx Xxxxxxxx
(telefax no. x00 (0)00 0000 0000) and shall be deemed to have
been made or delivered (in the case of telefax) when
transmission of such telefax communication has been completed
or (in the case of any letter) when delivered to the aforesaid
address or (as the case may be) five (5) days after being
deposited in the post first class postage prepaid in an
envelope addressed to it at that address.
17.3 Each notice, demand or other communication made or delivered
by one (1) party to the other pursuant to this Deed shall be
in the English language or accompanied by a certified English
translation.
18 GOVERNING LAW
18.1 This Deed shall be governed by and construed in accordance
with English law.
19 JURISDICTION
19.1 For the exclusive benefit of the Trustee, the Guarantor agrees
that any legal action or proceeding arising out of this Deed
may be brought in the High Court of Justice in England and
irrevocably submits to the jurisdiction of that court. The
submission by the Guarantor to such jurisdiction shall not
limit the right of the Trustee to commence any proceedings
arising out of this Deed in whatsoever jurisdiction it may
choose, nor shall the commencement of any such legal action or
proceeding in one (1) jurisdiction preclude the Trustee from
beginning any further or other such legal action or proceeding
in the same or any other jurisdiction.
19.2 The Guarantor appoints in the case of the courts of England
the Process Agent to receive, for and on its behalf, service
of process in England of any legal proceedings with respect to
this Deed.
30
IN WITNESS whereof this Deed of Guarantee and Indemnity has been executed by the
parties hereto on the day first written above.
SIGNED SEALED and DELIVERED as a DEED )
for and on behalf of ) P A XXXXXX
NCL CORPORATION LTD. )
acting by XXXX XXXXXX )
its duly appointed attorney-in-fact )
in the presence of: R XXXXXX )
TRAINEE SOLICITOR
XXXXXXXXXX XXXXXXX
XXX, XX. XXXX'X XXXXXXXXXX
XXXXXX XX0X 0XX
SIGNED SEALED and DELIVERED as a DEED )
for and on behalf of )
HSBC BANK PLC ) J XXXXX
acting by XXXXX XXXXX )
its duly appointed attorney-in-fact )
in the presence of: R XXXXXX )
TRAINEE SOLICITOR
XXXXXXXXXX XXXXXXX
XXX, XX. XXXX'X XXXXXXXXXX
XXXXXX XX0X 0XX
31
SCHEDULE 1
QUARTERLY COMPLIANCE CERTIFICATE
TO: HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Xxxxxxx
Attn: Mr Xxxx Xxxxxxxx
(as the Agent (as such term is defined in the Guarantee (as hereinafter
defined))
We refer to clause 11 of the guarantee dated 2004 (as amended, varied and/
or supplemented from time to time the "GUARANTEE") issued by us in favour of the
Trustee. Terms defined in the Guarantee, whether by reference to the Loan
Agreement (as therein defined) or otherwise, shall have the same meanings
herein.
We hereby certify the amounts set out in the attached schedule as at the last
day of the financial quarter ending 20[ ] for NCL Corporation Ltd. (the
"GUARANTOR") and its subsidiaries on a consolidated basis. We also hereby
certify that the Guarantor is in compliance with all the financial covenants set
out in clauses 11.1 and 11.3 of the Guarantee.
Chief Financial Officer
NCL CORPORATION LTD.
--------------------------
BY:
DATED: 20[ ]
32
STATEMENT OF FINANCIAL COVENANTS AS OF [ ] 20[ ] (IN USD'000)
Clause (Of
Guarantee) as of [O] Required Covenants
11.1(A) CASH BALANCE A A>USD50,000,000
11.1(B) CONSOLIDATED EBITDA: B >1.2 for 2004
>1.25:1 thereafter
CONSOLIDATED DEBT SERVICE C
11.1(C) TOTAL NET FUNDED DEBT: D <0.7 up to 31 December 2006
<0.65:1 thereafter
TOTAL CAPITALISATION E
CONSOLIDATED EBITDA
Consolidated Net Income (loss) x
Deduct: (Gain)/Loss on sale of assets or reserves x
Add: Consolidated Interest Expense x
Amortisation of intangible assets x
Depreciation of tangible assets x
Deferred income tax expense x
Other non-recurring charge (gain) x
X B
---------------
CONSOLIDATED DEBT SERVICE
Add: Principal paid/payable (excluding balloon payments,
voluntary prepayments/repayments on sale/total loss of
an NCLC Fleet vessel) x
Consolidated Interest Expense x
Distributions x
Rent under capitalised leases x
X C
---------------
CASH BALANCE X A
---------------
TOTAL FUNDED DEBT
Add: Indebtedness for Borrowed Money x
Guarantees of non-NCLC Group members' obligations X
---------------
X
Deduct: Unencumbered and otherwise unrestricted cash in excess (X)
---------------
of USD50,000,000
TOTAL NET FUNDED DEBT (X) D
---------------
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TOTAL CAPITALISATION
Add: Total Funded Debt x
Consolidated stockholders' equity x
Deduct: Intangible Assets (X)
Provision for taxation, deferred taxation, bad debts (X)
-------------
TANGIBLE NET WORTH x
-------------
TOTAL CAPITALISATION x E
-------------
For and on behalf of NCL CORPORATION LTD.
------------------------------
[ ]
I, [ ], the officer primarily responsible for the financial management of the
NCLC Group, hereby declare that, to the best of knowledge and belief, the above
Statement of Financial Covenants as of [ ] 20[ ], in my opinion, is true and
correct.
------------------------------
[ ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated: 20[ ]
34
SCHEDULE 2
LETTER OF INSTRUCTION
TO: HSBC BANK PLC
Project and Export Finance
0 Xxxxxx Xxxxxx
Xxxxxx X00 0XX
Xxxxxxx
Attn: Mr Xxxx Xxxxxxxx
(as the Agent (as hereinafter defined))
20 APRIL 2004
Dear Sirs
DEED OF GUARANTEE AND INDEMNITY DATED 20 APRIL 2004 (THE "GUARANTEE")
We refer to the Guarantee executed by us in favour of the Trustee (as defined in
the Guarantee) as security for the obligations of Ship Ventures Inc. (the
"BORROWER") under (among other things) the loan agreement dated 20 APRIL 2004
(as the same may be amended, varied, supplemented and/or novated from time to
time the "LOAN AGREEMENT") between (among others) the Borrower as borrower, the
banks whose names and offices appear in schedule 2 to the Loan Agreement (the
"LENDERS"), HSBC Bank plc as agent for the Lenders (the "AGENT") and HSBC Bank
plc as trustee for the Lenders (the "TRUSTEE").
Unless the context requires otherwise, words and expressions used herein shall
have the same meanings as ascribed to them in the Loan Agreement.
We refer to:
1. clause 17.5 of the Loan Agreement which provides that each Lender may
assign or transfer its respective rights under the Guarantee to any
person to whom the rights, or the rights and obligations, of that
Lender under the Loan Agreement are wholly or partially assigned or
transferred in accordance with the Loan Agreement; and
35
2. clause 17.5 of the Loan Agreement whereby the rights, benefits and/or
obligations of any Lender thereunder may be transferred by means of a
Transfer Certificate.
In consideration of the Lenders agreeing at our request to make the Loan
available to the Borrower in accordance with the terms of the Loan Agreement, we
hereby irrevocably and unconditionally authorise and instruct the Agent
forthwith to execute on our behalf each Transfer Certificate delivered to it
pursuant to clause 17.5 of the Loan Agreement without the Agent being under any
obligation to take any further instructions from us or to give any prior notice
to us before doing so.
This letter shall be governed by, and construed in accordance with, English law.
Yours faithfully
P.A. XXXXXX
----------------------------
NCL CORPORATION LTD.
By: XXXX XXXXXX
Title: ATTORNEY-IN-FACT
36
