CONFORMED COPY
Exhibit 4.2
LOAN AGREEMENT
for a
USD325,000,000
Term Loan
to
Golar Gas Holding Company, Inc.
provided by
the banks and financial
institutions listed herein
Lead Arrangers
Christiania Bank og Kreditkasse ASA
Den norske Bank ASA
Citibank, N.A.
and
Fortis Bank (Nederland) N.V.
Swap Banks
Den norske Bank ASA
and
Christiania Bank og Kreditkasse ASA
Administrative Agent
Christiania Bank og Kreditkasse
Security Agent
Den norske Bank ASA
Book Runner
Citibank, N.A.
XXXXXX XXXX
Contents
Clause Page
1 Purpose and definitions...............................................3
2 The Commitments and the Loan.........................................27
3 Interest.............................................................29
4 Repayment and prepayment.............................................31
5 Fees commission and expenses.........................................36
6 Payments and taxes; accounts and calculations........................37
7 Representations and warranties.......................................39
8 Undertakings.........................................................46
9 Conditions...........................................................70
10 Events of Default....................................................70
11 Indemnities..........................................................75
12 Unlawfulness and increased costs.....................................76
13 Set-off, pro rata payments...........................................78
14 Accounts.............................................................79
15 Transfer and lending office..........................................81
16 Administrative Agent, Security Agent
and Reference Banks..................................................84
17 Tax Lease Option.....................................................85
18 Notices and other matters............................................85
19 Governing law and jurisdiction.......................................87
Part 1 - The Banks and their Commitments....................................88
Part 2 - The Swap Banks.....................................................89
Schedule 2 The Ships........................................................90
Schedule 3 Form of Drawdown Notice..........................................94
Schedule 4 Documents and evidence required as
conditions precedent.............................................95
Schedule 5 Form of Transfer Certificate.....................................101
Schedule 6 Calculation of Additional Cost...................................107
Schedule 7 Form of officer's certificate
(referred to in clause 8.1(e)(ii)(D))............................110
Page 2
THIS AGREEMENT is dated 31 May 2001 and made BETWEEN:
(1) GOLAR GAS HOLDING COMPANY, INC. as Borrower;
(2) CHRISTIANIA BANK OG KREDITKASSE ASA, DEN NORSKE BANK ASA, CITIBANK, N.A.
and FORTIS BANK (NEDERLAND) N.V. as Lead Arrangers;
(3) the banks and financial institutions whose names and addresses are set
out in part 1 of schedule 1 as lenders;
(4) the banks and financial institutions whose names and addresses are set
out in part 2 of schedule 1 as Swap Banks;
(5) CHRISTIANIA BANK OG KREDITKASSE ASA as Administrative Agent;
(6) DEN NORSKE BANK ASA as Security Agent; and
(7) CITIBANK, N.A. as Book Runner.
IT IS AGREED as follows:
1 Purpose and definitions
1.1 Purpose
This Agreement sets out the terms and conditions upon and subject to
which the Banks agree, according to their several obligations, to make
available to the Borrower a term loan of up to USD325,000,000 to be used
for the purpose of enabling the Borrower to refinance certain existing
indebtedness in respect of the Ships, and to provide liquidity support
and working capital.
1.2 Definitions
In this Agreement, unless the context otherwise requires:
"Account Bank" means Christiania Bank og Kreditkasse ASA acting through
its office at X.X. Xxx 0000, Xxxxxxx, 0000 Xxxx, Xxxxxx (xx respect of
the Cash Collateral Account and one of the Earnings Accounts) and through
its office at Lloyds Xxxxxxxx, 0 Xxxxxxxxx Xxxxxx, Xxxxxx X0 0XX (in
respect of the other Earnings Accounts) and includes any other bank
designated in writing by the Administrative Agent (at the request of the
Borrower and acting on the instructions of the Majority Banks) to be an
"Account Bank" for the purposes of the Security Documents (whether
generally or in relation to a specific Earnings Account);
"Additional Cost" means, in relation to any period, a percentage
calculated for such period at an annual rate determined in accordance
with schedule 6;
Page 3
"Administrative Agent" means Christiania Bank og Kreditkasse ASA of X.X.
Xxx 0000, Xxxxxxx, 0000 Xxxx, Xxxxxx or such other person as may be
appointed administrative agent for the Banks pursuant to the Agency
Agreement;
"Affiliate" of any specified person means any other person directly or
indirectly controlling, or controlled by, or under direct or indirect
common control with such specified person;
"Agency Agreement" means the agency agreement executed or (as the context
may require) to be executed between the Lead Arrangers, the Swap Banks,
the Administrative Agent, the Security Agent, the Banks, the Borrower and
the Guarantors in the agreed form;
"Annual Financial Statements" means annual:
(a) financial statements of the Parent, the Borrower and each Owning
Company;
(b) consolidated financial statements of the Golar LNG Group including
Oxbow and Golar Maritime; and
(c) consolidated financial statements of the Golar LNG Group excluding
Oxbow and Golar Maritime,
each comprising a profit and loss account and a balance sheet and cash
flow statement and audited by the Auditors;
"Annualised EBITDA" means at any relevant date the EBITDA for the three
month period ending on such date multiplied by four (4);
"Approved Brokers" means, in relation to a Ship, such firm of insurance
brokers, appointed by its Owning Company, as may from time to time be
approved in writing by the Administrative Agent for the purposes of this
Agreement;
"Approved Charter" means, in relation to a Ship as at the date hereof,
the charterparty in respect of such Ship (if any) details of which are
specified in Part 2 of schedule 2 and, in relation to Xxxxx Xxxx, means
the Pertamina Charter;
"Approved Charterer" means, in relation to a Ship or Xxxxx Xxxx, the
person who is the charterer or employer of such Ship under an Approved
Charter of such Ship or Xxxxx Xxxx;
Page 4
"Approved Management Agreement" means, in relation to each Ship:
(a) as at the date hereof, the management agreement between the
relevant Owning Company and the Initial Manager thereof providing
(inter alia) for the Initial Manager to provide the technical
management of (inter alia) such Ship, details of which are
specified in Part 2 of schedule 2;
(b) as at the date hereof, the sub-management agreement dated 1
January 1999 between the Initial Manager and the Initial
Sub-Manager providing (inter alia) for the Initial Sub-Manager to
provide the technical management of (inter alia) such Ship; and
(c) any future management agreement relative (inter alia) to that Ship
entered into by the relevant Owning Company with an Approved
Manager on terms previously approved by the Administrative Agent
(such approval not to be unreasonably withheld);
"Approved Manager" means, in relation to a Ship:
(a) for the time being, the Initial Manager and the Initial
Sub-Manager for that Ship (including, but not limited to, any
other manager or sub-manager to whom the Initial Manager may
delegate its management of such Ship on terms, inter alia, that
the Initial Manager remains wholly responsible as principal to the
relevant Owning Company for the due performance of the relevant
management obligations); or
(b) any other entity appointed with the prior written consent of the
Administrative Agent as manager or sub-manager of such Ship,
and, in relation to Xxxxx Xxxx, means Aurora Management Inc. of 00 Xxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxx and Xxxxxx-Xxxxxx International Ltd. as
sub-manager;
"Auditors" means PricewaterhouseCoopers or another first class firm of
international accountants;
"Banking Day" means a day on which dealings in deposits in Dollars are
carried on in the London Interbank Eurocurrency Market and (other than
Saturday or Sunday) on which banks are open for business in London, New
York City and Oslo (or any other relevant place of payment under clause
6);
"Banks" means the banks and financial institutions listed in part 1 of
schedule 1 and includes their successors in title and assignees and
transferees;
"Borrower" means Golar Gas Holding Company, Inc., a company incorporated
in Liberia whose registered office is at 00 Xxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxx;
Page 5
"Borrowed Money" means Indebtedness incurred in respect of:
(a) money borrowed or raised and debit balances at banks;
(b) any bond, note, loan stock, debenture or similar debt instrument;
(c) acceptance or documentary credit facilities;
(d) receivables sold or discounted (otherwise than on a non-recourse
basis);
(e) deferred payments for assets or services acquired (other than
assets or services acquired on normal commercial terms in the
ordinary course of business where payment is deferred by no more
than 180 days);
(f) Capitalised Lease Obligations;
(g) any other transaction (including without limitation forward sale
or purchase agreements) having the commercial effect of a
borrowing or raising of money;
(h) guarantees in respect of Indebtedness of any person falling within
any of (a) to (g) above; and
(i) preference share capital in the Borrower or any other member of
the Golar Gas Group which is or may be redeemable prior to the
Final Repayment Date and/or the full and final discharge of all
Indebtedness and liabilities of the Borrower under this Agreement;
"Breakage Costs" shall have the meaning ascribed to it in clause 11.1;
"capital expenditure" means expenditure incurred in:
(i) improving, upgrading or refurbishing any of the Ships or any other
vessels or other fixed assets of the Golar Gas Group;
(ii) the acquisition of buildings, plant, machinery, vessels or other
fixed tangible assets of the Golar Gas Group or other expenditure
which is to be treated as capital expenditure in accordance with
GAAP including Capitalised Lease Obligation commitments
but does not include expenditure on repairing or maintaining any of the
Ships or any other vessels or other fixed assets;
"Capitalised Lease Obligation" of any person means the obligation to pay
rent or other payment amounts under a lease of (or other Borrowed Money
arrangements conveying the right to use) real or personal property which
is required to be classified and accounted for as a capitalised lease or
a liability on the face of a balance sheet of such person in accordance
with GAAP;
Page 6
"Cash Balances" means, at any relevant time, an amount equal to the
aggregate amount which is, at such time, credited to and/or invested in
Earnings Accounts;
"Cash Reserve" means, in relation to any date (the "Calculation Date"),
the aggregate of:
(a) an amount equal to the aggregate of:
(i) the product of:
(A) an amount equal to the applicable fraction of the
aggregate of the repayment instalment projected to
fall due under clause 4.1 on the first Repayment
Date following the Calculation Date multiplied by
(B) the number of accrual dates falling on or before the
relevant Calculation Date and after the Repayment
Date immediately preceding the Calculation Date; and
(ii) the product of:
(A) an amount equal to the applicable fraction of the
amount of interest falling due for payment in
respect of each part of the Loan at the end of each
Interest Period current at the Calculation Date
multiplied by
(B) the number of accrual dates falling on or before the
Calculation Date and after the beginning of the
relevant Interest Period;
(iii) and for the purpose of paragraphs (i) and (ii) above:
(A) the "accrual dates" mean the date falling fourteen
(14) days after the Drawdown Date and each of the
dates falling at monthly intervals after such date
and prior to Final Repayment Date;
(B) the "applicable fraction" means, in relation to
paragraph (i), a fraction having a numerator of one
and a denominator equal to the number of accrual
dates falling between the first Repayment Date
following the Calculation Date and the immediately
preceding Repayment Date or, if the first Repayment
Date following the Calculation Date is the first
Repayment Date, the Drawdown Date and, in relation
to paragraph (ii) above, means a fraction having a
numerator of one and a denominator equal to the
number of accrual dates falling within the relevant
Interest Period; and
Page 7
(b) an amount equal to the Expenditure Provision accrued for the
period from the relevant start dates (as "start date" is defined
in the definition of "Expenditure Provision") up to the
Calculation Date in respect of expenditure which is projected to
be paid after the Calculation Date and, for the purpose of this
definition, any Expenditure Provision shall be deemed to accrue on
a daily basis from the relevant start dates to the relevant
expenditure dates (as "expenditure date" is defined in the
definition of "Expenditure Provision");
"Casualty Amount" means five million Dollars (USD5,000,000) (or the
equivalent in any other currency);
"Charter Guarantee" means, in relation to a Ship or Xxxxx Xxxx:
(a) as at the date hereof, any guarantee in respect of the current
Approved Charter of that Ship which is specified in Part 2 of
schedule 2 or Xxxxx Xxxx; and
(b) any other guarantee, letter of credit, Encumbrance or other
security given by any person to the relevant Owning Company in
respect of the obligations of the Approved Charterer under an
Approved Charter of that Ship or Xxxxx Xxxx;
"Charter Guarantor" means, in relation to a Ship or Xxxxx Xxxx, any
person who has given a Charter Guarantee to the Owning Company of that
Ship or (as the case may be) Faraway;
"Classification" means, in relation to each Ship, the classification set
forth against the name of such Ship in Part 1 of schedule 2 with its
Classification Society or such other classification as the Administrative
Agent shall, at the request of its Owning Company, have agreed in writing
shall be treated as the Classification of such Ship for the purposes of
this Agreement;
"Classification Society" means, in relation to any Ship, the
classification society set forth against the name of such Ship in Part 1
of schedule 2 or such other classification society which the
Administrative Agent shall, at the request of its Owning Company, have
agreed in writing shall be treated as its Classification Society for the
purposes of this Agreement;
"Commitment" means, in relation to a Bank, the amount set out opposite
its name in schedule 1 or, as the case may be, in any relevant Transfer
Certificate, as reduced by any relevant term of this Agreement;
"Compulsory Acquisition" means requisition for title or other compulsory
acquisition, requisition, appropriation, expropriation, deprivation,
forfeiture or confiscation for any reason of a vessel by any Government
Entity or other competent authority, whether de jure or de facto, but
shall exclude requisition for use or hire not involving requisition of
title;
Page 8
"Contribution" means, in relation to a Bank, the principal amount of the
Loan owing to such Bank at any relevant time;
"control" when used with respect to any person means either the ownership
of more than 50 per cent of the voting share capital (or equivalent
rights of ownership) of such person or the power to direct the management
and policies of such person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms
"controlling" and "controlled" shall be construed accordingly;
"Creditors" means the Lead Arrangers, the Administrative Agent, the
Security Agent, the Book Runner, the Banks and the Swap Banks;
"Cumulative Net Income" means, at any relevant date, the consolidated net
income of the Borrower and its Subsidiaries (other than Oxbow, Golar
Maritime and Faraway) after all expenses (ship operating and selling,
general and administrative), depreciation and amortisation, interest
expenses, taxes and any other charges to the profit and loss account, all
as determined in accordance with GAAP for the period from 1 January 2001
to the end of the financial quarter of the Golar Gas Group which most
recently ended at least sixty (60) days before the relevant date;
"Current Assets" means, on a consolidated basis, the current assets (as
determined in accordance with GAAP) of the Golar Gas Group (excluding for
this purpose, Oxbow, Golar Maritime and Faraway);
"Current Liabilities" means, on a consolidated basis, the current
liabilities (as determined in accordance with GAAP) of the Golar Gas
Group (excluding for this purpose, Oxbow, Golar Maritime and Faraway);
"Default" means any Event of Default or any event or circumstance which
with the giving of notice or lapse of time or the satisfaction of any
other condition (or any combination thereof) would constitute an Event of
Default;
"Disposal Repayment Date" shall have the meaning ascribed thereto in
clause 4.3;
"Dollars" and "USD" mean the lawful currency of the United States of
America and in respect of all payments to be made under any of the
Security Documents mean funds which are for same day settlement in the
New York Clearing House Interbank Payments System (or such other U.S.
dollar funds as may at the relevant time be customary for the settlement
of international banking transactions denominated in U.S.
dollars);
"Drawdown Date" means any date, being a Banking Day, falling not later
than the Latest Drawdown Date, on which the Loan is or is to be drawn
down;
Page 9
"Drawdown Notice" means a notice substantially in the terms of schedule
3;
"Earnings" means, in relation to any Mortgaged Ship or Xxxxx Xxxx, all
moneys whatsoever from time to time due or payable to the relevant Owning
Company or (in the case of Xxxxx Xxxx) Faraway during the Security Period
arising out of the use or operation of such Mortgaged Ship or Xxxxx Xxxx
including (but without limiting the generality of the foregoing) all
freight, hire and passage moneys, income arising out of pooling
arrangements, compensation payable to the relevant Owning Company or (as
the case may be) Faraway in the event of requisition of such Mortgaged
Ship or Xxxxx Xxxx for hire, remuneration for salvage or towage services,
demurrage and detention moneys and damages for breach (or payments for
variation or termination) of any charterparty or other contract for the
employment of such Mortgaged Ship or Xxxxx Xxxx and any sums recoverable
under any loss of earnings insurance;
"Earnings Account" means any of the accounts of the Borrower or the
Owning Company of any Mortgaged Ship or all of the Owning Companies with
an Account Bank designated in writing by the Administrative Agent (at the
request of the Borrower or (where an existing Earnings Account is to be
closed by the relevant Account Bank) the Administrative Agent and in
either case acting on the instructions of the Majority Banks) to be an
Earnings Account for the purposes of the Security Documents (and includes
any fixed term deposit contract or account associated with such account
and/or arranged through the Account Bank as contemplated by clause
14.1(b)(iii)) and which is subject to an effective Encumbrance in favour
of the Security Agent as security for the obligations of the Borrower
under this Agreement in accordance with clause 14 and "Earnings Accounts"
means all of such accounts and fixed term deposit contracts and/or
accounts;
"Earnings Account Security" means a deed of assignment executed or (as
the context may require) to be executed by any person in favour of the
Security Agent in respect of (inter alia) an Earnings Account as security
for the obligations of the Borrower under this Agreement in the agreed
form or in such other form as the Administrative Agent may reasonably
require for the purpose of creating effective security over such account
under any applicable laws;
"EBITDA" means, for any period, the earnings before interest, taxes and
depreciation and amortisation (calculated as income from operations plus
any depreciation and amortisation, Interest Expense, and taxes on overall
net income deducted in calculating income from operations in respect of
such period) of the Golar Gas Group (excluding for this purpose Oxbow,
Golar Maritime and Faraway) determined in accordance with GAAP on a
consolidated basis;
Page 10
"Eligible Swap Contract" means the swap contracts dated 31 May 2001 and
entered into between the Borrower and the Swap Banks upon and pursuant to
the Swap confirmation (reference ) and incorporating the
terms and conditions of the ISDA Master Agreement made between the
Borrower and each of the Swap Banks for the purpose of swapping for
and/or capping to a fixed interest rate the Borrower's exposure under
this Agreement to fluctuations in Dollar interest rates on a minimum of
fifty per cent (50%) of the Loan for a period of at least sixty (60)
months from the Drawdown Date and based on a repayment schedule
corresponding to the Repayment Dates and at least half of the repayment
instalments due hereunder on each such Repayment Date;
and "continuing Eligible Swap Contract" means, at any relevant time, an
Eligible Swap Contract under which any party thereto has or may have
continuing actual or contingent obligations at such time;
"Eligible Swap Liabilities" means Swap Liabilities owing to any Swap Bank
incurred under an Eligible Swap Contract;
"Encumbrance" means any mortgage, charge (whether fixed or floating),
pledge, lien, hypothecation, assignment, security deposit arrangement,
trust arrangement or security interest or other encumbrance of any kind
securing any obligation of any person or any type of preferential
arrangement (including, without limitation, conditional sale or title
transfer and/or retention arrangements having a similar effect);
"Environmental Approval" means any consent, authorisation, licence or
approval of any governmental or public body or authorities or courts
applicable to any vessel or its operation required under any
Environmental Law;
"Environmental Claim" means any and all enforcement, clean-up, removal or
other governmental or regulatory actions or orders instituted or
completed pursuant to any Environmental Law or any Environmental Approval
together with claims made by any third party relating to damage,
contribution, loss or injury, resulting from any actual or threatened
emission, spill, release or discharge of a Pollutant from any vessel;
"Environmental Laws" means all national, international and state laws,
rules, regulations, treaties and conventions applicable to any vessel
pertaining to the pollution or protection of human health or the
environment including, without limitation, the carriage of Pollutants and
actual or threatened emissions, spills, releases or discharges of
Pollutants;
Page 11
"Equity Distribution" means, in relation to a person, any of the
following:
(a) the purchase, redemption or other acquisition for any value by
such person or any Subsidiary of such person of any ordinary or
preference shares of such person's share capital;
(b) the repayment, redemption or acquisition for value by such person
or any Subsidiary of such person of any other form of Equity
Finance received or raised by such person; or
(c) the declaration or payment of any dividend, interest, commission
or other costs or charges of a periodic nature in respect of
Equity Finance or the distribution of any of such person's present
or future assets, undertakings, rights or revenues to any of its
shareholders;
"Equity Finance" means:
(a) the issue for cash of ordinary shares in the Borrower;
(b) the issue for cash of preference shares in the Borrower (other
than preference share capital which constitutes Borrowed Money of
the Borrower);
(c) the incurring of Subordinated Debt; or
(d) any combination of the foregoing;
"Event of Default" means any of the events or circumstances described in
clause 10.1;
"Expenditure Provision" means, in relation to any period, the aggregate
of the relevant fractions of the amounts of all relevant expenditure
which is projected in accordance with clause 1.10 to be paid on dates
falling after the expiry of such period and for this purpose:
(a) the "relevant fraction" means, in relation to an item of relevant
expenditure, the fraction whose numerator is the number of accrual
days in respect of such relevant expenditure falling during such
period and whose denominator is the total number of such accrual
days in respect of such relevant expenditure;
(b) "relevant expenditure" means:
(i) costs of repairing and maintaining and making good any of
the Mortgaged Ships at that Ship's routine scheduled
drydocking or repairing any damage incurred during or
before the relevant period and the costs of such
drydocking; and
(ii) capital expenditure on a Mortgaged Ship which is projected
to be paid after the end of the relevant period in
accordance with clause 1.10 pursuant to a legally binding
contract entered into during or before the relevant period
provided that such capital expenditure is permitted
pursuant to clause 8.3(b);
Page 12
(c) an "accrual day" means, in relation to any relevant expenditure,
each date falling after the start date for such expenditure up to
and including the date (the "expenditure date") upon which the
relevant expenditure is projected to be paid in accordance with
clause 1.10; and
(d) "start date" means, in the case of expenditure falling within
paragraph (b)(i), the date of completion of the relevant Mortgaged
Ship's last drydocking or, in the case of damage, the date such
damage occurred and, in the case of expenditure falling within
paragraph (b)(ii), the date upon which the relevant legally
binding contract is entered into;
"Faraway" means Faraway Maritime Shipping Company Limited a company
incorporated in Liberia whose registered office is at 00 Xxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx;
"Faraway Documents" means:
(a) the Faraway Shareholders Agreement;
(b) the Xxxxx Xxxx Management Agreement;
(c) the articles of incorporation and bye-laws of Faraway; and
(d) the Faraway Loan Agreement;
"Faraway Loan Agreement" means the agreement dated as of 26 November 1997
for a secured loan facility of up to USD214,500,000 made between (inter
alios) Bank of Taiwan as lead arranger, the banks and financial
institutions referred to therein as lenders, Indosuez Asia Shipfinance
Services Limited as agent and Faraway as borrower and any future loan
agreement entered into by Faraway in accordance with clause 8.6(d);
"Faraway Shareholders' Agreement" means the shareholders agreement dated
14 June 1997 between Oxbow, Chinese Petroleum Corporation and Golar
Maritime;
"Final Repayment Date" means, subject to clause 6.4, the date falling
seventy-two (72) months after the Drawdown Date;
"Flag State" means the Republic of Liberia or such other state or
territory as the Banks may approve, at the request of the relevant Owning
Company, as being the "Flag State" of such Ship for the purposes of the
Security Documents;
"Free Available Cash" means, at any relevant time, the amount of the Cash
Balances, freely available for use by the Borrower and/or any of the
Owning Companies which may, notwithstanding any Encumbrance, right of
set-off or agreement with any other party, be withdrawn and/or encashed
and used by it for any lawful purpose without restriction (save pursuant
to the Security Documents);
"GAAP" means generally accepted accounting principles in the United
States of America consistently applied;
"General Assignment" means, in relation to a Ship, a general assignment
in respect of such Ship executed or (as the context may require) to be
executed by the relevant Owning Company in favour of the Security Agent
in the agreed form and "General Assignments" means all of such general
assignments;
"Golar Gas Group" means the Borrower and its Subsidiaries (other than
Faraway unless Faraway becomes a wholly owned Subsidiary of the
Borrower);
Page 13
"Golar LNG Group" means the Parent and its Subsidiaries and for the
purposes of the definitions of "Annual Financial Statements" and
"Quarterly Financial Statements" (and the expression "Golar LNG Group"
where used in such definitions) any company or entity whose accounts are
to be consolidated with those of the Parent in accordance with GAAP shall
be treated as a Subsidiary of the Parent;
"Golar Maritime" means Golar Maritime (Asia) Inc. a company incorporated
in Liberia whose registered office is at 00 Xxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxx;
"Xxxxx Xxxx" means m.v. "XXXXX XXXX" registered under Liberian flag in
the ownership of Faraway under Official Number 11170;
"Xxxxx Xxxx Management Agreement" means the management agreement dated as
of 28 October 1997 in respect of Xxxxx Xxxx between (1) Faraway and (2)
Aurora Management Inc.;
"Government Entity" means and includes (whether having a distinct legal
personality or not) any national or local government authority, board,
commission, department, division, organ, instrumentality, court or agency
and any association, organisation or institution of which any of the
foregoing is a member or to whose jurisdiction any of the foregoing is
subject or in whose activities any of the foregoing is a participant;
"Guarantees" means each of the Subsidiary Guarantee, the Managers'
Guarantee and the Parent Guarantee and "Guarantee" means any of them;
"Guarantor" means any of the Parent, the Initial Manager, the Initial
Sub-Manager and the Subsidiary Guarantors and "Guarantors" means all of
them;
"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;
"Initial Manager" means Osprey Maritime Management Limited of Warner
Building, 00 Xxxx Xxxxxx, Xxxxxxxx XX00, Xxxxxxx;
"Initial Sub-Manager" means Osprey Maritime (Europe) Ltd. of Warner
Building, 00 Xxxx Xxxxxx, Xxxxxxxx XX00, Xxxxxxx;
"Insurances" means, in relation to any Mortgaged Ship or Xxxxx Xxxx, all
policies and contracts of insurance (which expression includes all
entries of such vessel in a protection and indemnity or war risks
association) which are from time to time during the Security Period in
place or taken out or entered into by or for the benefit of the relevant
Owning Company or (in the case of Xxxxx Xxxx) Faraway (whether in the
sole name of such Owning Company or (as the case may be) Faraway or in
the joint names of such Owning Company or (in the case of Xxxxx Xxxx)
Faraway and any other person) in respect of such Ship or Xxxxx Xxxx or
otherwise howsoever in connection with such Ship or Xxxxx Xxxx and all
benefits thereof (including claims of whatsoever nature and return of
premiums);
"Interest Expense" means, for any period, interest charges and related
expenses for such period of the Golar Gas Group determined (excluding for
this purpose Oxbow, Golar Maritime and Faraway) in accordance with GAAP
on a consolidated basis;
"Interest Period" means, in relation to the Loan, each period for the
calculation of interest in respect of the Loan ascertained in accordance
with clauses 3.2 and 3.3;
Page 14
"ISM Code" means the International Safety Management Code for the Safe
Operation of Ships and for Pollution Prevention constituted pursuant to
Resolution A.741 (18) of the International Maritime Organisation and
incorporated into the Safety of Life at Sea Convention and includes any
amendments or extensions of it and any regulation issued pursuant to it;
"Latest Drawdown Date" means 15 August 2001 or such later date as the
Banks in their absolute discretion agree in writing;
"Lead Arrangers" means Christiania Bank og Kreditkasse ASA of X.X. Xxx
0000, Xxxxxxx, 0000 Xxxx, Xxxxxx, Den norske Bank ASA of Xxxxxxxx 00,
X-0000 Xxxx, Xxxxxx and Citibank, N.A. of 00 Xxxxxx Xxxxxx, Xxxxxx Xxxxx,
Xxxxxx X00 SLB and Fortis Bank (Nederland) N.V., Oslo Branch of
Xxxxxxxxxxxxxx 00x, XX-0000 Xxxx, Xxxxxx and "Lead Arranger" means any of
them;
"LIBOR" means, in relation to a particular period, the rate for deposits
of Dollars for a period equivalent to such period at or about 11 am
(London time) on the second London Banking Day before the first day of
such period as displayed on Telerate page 3750 (British Bankers'
Association Interest Settlement Rates) (or such other page as may replace
such page 3750 on such system or on any other system of the information
vendor for the time being designated by the British Bankers' Association
to calculate the BBA Interest Settlement Rate (as defined in the British
Bankers' Association's Recommended Terms and Conditions ("BBAIRS" terms)
dated August, 1985)), provided that if on such date no such rate is so
displayed, LIBOR for such period shall be the arithmetic mean (rounded
upward if necessary to four decimal places) of the rates respectively
quoted to the Administrative Agent by each of the Reference Banks at the
request of the Administrative Agent as such Reference Bank's offered rate
for deposits of Dollars in an amount approximately equal to the amount in
relation to which LIBOR is to be determined for a period equivalent to
such period to prime banks in the London Interbank Market at or about 11
am (London time) on the second Banking Day before the first day of such
period;
"Loan" means the aggregate principal amount borrowed, or to be borrowed,
by the Borrower on the Drawdown Date or (as the context may require) the
aggregate principal amount owing to the Banks under this Agreement at any
relevant time;
"LondonBanking Day" means a day on which banks are open for business in
London;
"Loss Payable Clauses" means the provisions regulating the manner of
payment of sums receivable under the Insurances of a Ship which are to be
incorporated in the relevant insurance documents, such Loss Payable
Clauses to be in the forms set out in schedule 1 to the General
Assignments or in such other forms as may from time to time be agreed in
writing by the Administrative Agent;
"Majority Banks" means Banks the aggregate of whose Commitments exceed
sixty six and two thirds per cent. (662/3%) of the Total Commitments save
that, where the Commitments of a single Bank exceed, or the aggregate
Commitments of Banks which are Affiliates of each other together exceed,
sixty six and two thirds per cent. (662/3%) of the Total Commitments,
"Majority Banks" shall mean Banks the aggregate of whose Commitments
exceed the Commitment of such single Bank or the aggregate of the
Commitments of such Banks who are Affiliates of each other;
Page 15
"Manager's Undertaking" means, in relation to a Ship, an agreement
entered or (as the context may require) to be entered into between the
Approved Manager of such Ship and the Security Agent in the agreed form;
"Managers' Guarantee" means the joint and several guarantee issued or (as
the context may require) to be issued by the Initial Manager and the
Initial Sub-Manager in favour of the Security Agent in the agreed form;
"Margin" means 1.5%;
"Minimum Free Available Cash" means an amount equal to USD25,000,000
except that, unless either:
(a) on or before 31 December 2002 the Approved Charterer of m.v.
"GOLAR FREEZE" described in schedule 2 exercises its option under
its Approved Charter of such Ship to extend the period of such
Approved Charter to at least 1 January 2013; or
(b) if (a) above does not apply, the Owning Company for such Ship
enters into an Approved Charter for such Ship and:
(i) the Ship is delivered to the relevant Approved Charterer no
later than the earlier of 1) the date falling twelve (12)
months after the option referred to in (a) above has either
lapsed or been cancelled and 2) 31 December 2003 (the
"Option Lapse Date");
(ii) the minimum firm period of such charter is at least seven
years;
(iii) the Approved Charterer (or, if a Charter Guarantee is given
in respect of its obligations under the charter, the
relevant Charter Guarantor) has a long term credit rating
of at least BBB+ from Standard & Poor's Rating Services
(and Baa1 from Moodys Investors Services Inc. or any other
rating agency approved in writing by the Administrative
Agent for such purpose);
(iv) charterhire under such charter is calculated and payable in
Dollars;
(v) the Administrative Agent is satisfied that the charterhire
payable thereunder (assuming annual average offhire not
exceeding 14 days per annum) (or, if such charter is a
demise charter, the time charter equivalent thereof as
determined by the Administrative Agent) will be no less
than the charterhire which would have been received by the
relevant Owning Company during the period to the Final
Repayment Date if (a) above had applied
in which event "Minimum Free Available Cash" shall, as from the
anniversary of the Option Lapse Date, mean USD30,000,000;
"month" means a period beginning in one calendar month and ending in the
next calendar month on the day numerically corresponding to the day of
the calendar month on which it started, provided that (i) if the period
started on the last Banking Day in a calendar month or if there is no
such numerically corresponding day, it shall end on the last Banking Day
in such next calendar month and (ii) if such numerically corresponding
day is not a Banking Day, the period shall end on the next following
Banking Day in the same calendar month but if there is no such Banking
Day it shall end on the preceding Banking Day and "months" and "monthly"
shall be construed accordingly; "Mortgage" means, in relation to a Ship,
a first preferred mortgage of such Ship executed or (as the context may
require) to be executed by the relevant Owning Company in favour of the
Security Agent in the agreed form and "Mortgages" means all of such
mortgages;
Page 16
"Mortgaged Ship" means, at any relevant time, any Ship which is at such
time subject to a Mortgage and/or Earnings, the Insurances and
Requisition Compensation of which are subject to an Encumbrance pursuant
to the relevant Mortgage and General Assignment and a Ship shall for the
purposes of this Agreement be deemed to be a Mortgaged Ship as from the
date that the Mortgage of that Ship shall have been executed and
registered in accordance with this Agreement until whichever shall be the
earlier of (i) the due performance by the Borrower of all its obligations
under clause 4.3 following the sale or Total Loss of such Ship and (ii)
the end of the Security Period;
"Net Debt" means, on a consolidated basis, an amount equal to the
aggregate of all Borrowed Money of the Golar Gas Group (excluding for
this purpose Oxbow, Golar Maritime and Faraway) other than Subordinated
Debt minus Free Available Cash;
"Net Sale Proceeds" means, in relation to a Ship or Xxxxx Xxxx, the sale
price of such ship received by the relevant Owning Company or Faraway
(after deducting the relevant Owning Company's or Faraway's reasonable
costs and out-of-pocket expenses incurred in connection with such sale
including reasonable and proper costs of drydocking the relevant ship and
carrying out any repairs on the ship for the purposes of complying with
its obligations under the relevant sale agreement);
"Notice of Assignment of Insurances" means, in relation to a Ship, a
notice of assignment in the form set out in schedule 2 to the relevant
General Assignment or in such other form as may from time to time be
required or agreed in writing by the Administrative Agent;
"Operating Costs" means, in relation to any Mortgaged Ship during any
period, all moneys paid by or on behalf of the Owning Company of such
Ship during such period in respect of:
(a) liabilities incurred for the purpose of operating such Ship
including costs of xxxxxxx, insuring, repairing, maintaining and
drydocking such Ship;
(b) all proper and reasonable expenses of managing and administering
the corporate affairs of such Owning Company;
(c) any remuneration of the Approved Manager of such Ship under the
Approved Management Agreement for such Ship;
(d) amounts incurred by way of capital expenditure on the relevant
Ship which is permitted under clause 8.3(b);
(e) amounts required to discharge liabilities or obligations to third
parties incurred in the ordinary course of the operation of such
Mortgaged Ship;
(f) the repair or making good any loss or damage arising out of a
casualty to the Ship or any collision, accident or other
circumstances resulting in death or personal injury to any person
and/or damage to any property or economic interests; and
Page 17
(g) any amount equal to the approved proportion of any proper and
reasonable costs and expenses of managing and administering the
corporate affairs of the Borrower (and, for this purpose, the
approved proportion shall be such proportion as may from time to
time be approved in writing by the Administrative Agent having
regard to the number of vessels owned by, or bareboat chartered
to, members of the Golar Gas Group);
"Osprey" means Osprey Maritime Limited of 00 Xxxxxxx Xxxx #00-00, Xxxxx
Xxxxxxxx, Xxxxxxxxx 000000;
"Owning Company" means, in relation to a Ship, the company incorporated
in Liberia whose registered office is at Broad Street, Monrovia, Liberia
whose name is set forth against the name of such Ship in Part 1 of
schedule 2 and "Owning Companies" means all of such companies;
"Oxbow" means Oxbow Holdings Inc. a company incorporated in the British
Virgin Islands whose registered office is at XX Xxx 0000, Xxxx Xxxx,
Xxxxxxx, Xxxxxxx Xxxxxx Xxxxxxx;
"Parent" means Golar LNG Ltd. a company incorporated in Bermuda whose
registered office is at Xxxxxxx Xxxxx, 000 Xxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxx;
"Parent Guarantee" means the guarantee issued or (as the context may
require) to be issued by the Parent in favour of the Security Agent in
the agreed form;
Page 18
"Permitted Encumbrance" means:
(a) any Encumbrance created pursuant to the Security Documents;
(b) Permitted Liens; and
(c) the first preferred mortgage over Xxxxx Xxxx dated 6 January 2000
executed by Faraway as security for the Faraway Loan Agreement and
any other Security Document (as defined in the Faraway Loan
Agreement);
"Permitted Liens" means, to the extent not yet required to be discharged
pursuant to the terms of the relevant Mortgage:
(a) any ship repairer's or outfitter's possessory lien in respect of a
vessel owned by a member of the Golar Gas Group provided that (i)
the lien on such vessel is for an amount not exceeding
USD2,000,000, (ii) all such liens (including the relevant lien) on
all vessels owned by members of the Golar Gas Group at the time
such lien arises or is conferred by contract are for an aggregate
amount not exceeding an amount equal to the product of
USD2,000,000 multiplied by the number of Mortgaged Ships at the
relevant time and (iii) no such lien shall be deemed a Permitted
Lien if it is incurred at a time when a Default has occurred and
is continuing until such time as the Default is no longer
continuing;
(b) any ship repairer's lien or outfitter's possessory lien not
falling within paragraph (a) of this definition but which has been
previously approved in writing by the Majority Banks;
(c) any lien on a vessel for current master's, officer's or crew's
wages outstanding in the ordinary course of trading; and
(d) any lien for salvage;
"Pertamina" means Perusahaan Pertambangan Minyak Xxx Gas Bumi Negara a
state enterprise of the Republic of Indonesia;
"Pertamina Charter" means the time charterparty relative to Xxxxx Xxxx
dated 2 July 1997 made between (1) Faraway as owner and (2) Pertamina as
charterer, which is scheduled to expire on 31 December 2017;
"Pollutant" means and includes pollutants, contaminants, toxic
substances, oil as defined in the United States Oil Pollution Act of 1990
and all hazardous substances as defined in the United States
Comprehensive Environmental Response, Compensation and Liability Xxx
0000;
"Port of Registry" means, in relation to each Ship, the port (if any) set
forth against the name of such Ship in Part 1 of schedule 2 or such other
port of registry (if any) in a Mortgaged Ship's Flag State approved in
writing by the Administrative Agent acting on the instructions of the
Banks at which such Ship is, or is to be registered on, or at any
relevant time after, the date hereof;
Page 19
"Quarterly Financial Statements" means quarterly:
(i) financial statements of the Parent, the Borrower and each Owning
Company;
(ii) consolidated financial statements of the Golar LNG Group; and
(iii) consolidated financial statements of the Golar Gas Group excluding
Oxbow and Golar Maritime,
prepared as at 31 March, 30 June and 30 September (but not 31 December)
in each year (or three, six or nine (but not twelve) months after the
commencement of the Borrower's accounting period should its accounting
reference date be changed, with the prior written consent of the
Administrative Agent (acting on the instructions of the Banks) from 31
December) comprising a profit and loss account and a balance sheet and a
cash flow statement;
"Reference Banks" means Christiania Bank og Kreditkasse ASA, Den norske
Bank ASA, Citibank, N.A. and Fortis Bank (Nederland) N.V. and/or any
other Bank appointed as such pursuant to the Agency Agreement;
"Registry" means, in relation to each Ship, such registrar, commissioner
or representative of the relevant Flag State who is duly authorised and
empowered to register the relevant Ship, the relevant Owning Company's
title to such Ship and the relevant Mortgage under the laws and flag of
the relevant Flag State;
"Relevant Fraction" shall mean for the purpose of the definition of
"Relevant Insured Amount" and clause 4.3, a fraction whose numerator is
the market value of the relevant Mortgaged Ship and whose denominator is
the aggregate of the market values of all the Mortgaged Ships (including
such Mortgaged Ship) at the relevant date;
"Relevant Insured Amount" means, in relation to a Mortgaged Ship as at
any relevant date, an amount in Dollars equal to the Relevant Fraction as
at such date of the Loan as at such date;
"Relevant Jurisdiction" means any jurisdiction in which or where any
Security Party is incorporated, resident, domiciled, has a permanent
establishment, carries on, or has a place of business or is otherwise
effectively connected;
"Repayment Dates" means, subject to clause 6.3, the date falling six (6)
months after the Drawdown Date and each of the dates falling at intervals
of three (3) months after such date up to and including the Final
Repayment Date;
"Requisition Compensation" means, in relation to a Mortgaged Ship or
Xxxxx Xxxx, all sums of money or other compensation from time to time
payable during the Security Period by reason of the Compulsory
Acquisition of such Ship or Xxxxx Xxxx;
"Restricted Associate" means any associate of the Borrower other than an
associate which is:
(a) a wholly owned Subsidiary of the Borrower;
(b) a Subsidiary of the Borrower unless any part of the share capital
of such Subsidiary is owned by any person who is an associate of
the Borrower which is not a wholly-owned Subsidiary of the
Borrower;
Page 20
"Rollover Date" means the last day of an Interest Period;
"Security Agent" means Den norske Bank ASA of Xxxxxxxx 00, X-0000 Xxxx,
Xxxxxx or such other person as may be appointed security agent and
trustee for the Banks and the Swap Banks pursuant to the Agency
Agreement;
"Security Documents" means this Agreement, the Mortgages, the General
Assignments, the Subsidiary Pledges, the Guarantees, the Agency
Agreement, the Manager's Undertakings, the Subordination Deed, any
Earnings Account Security, the Eligible Swap Contracts and any other
documents as may have been or shall from time to time after the date of
this Agreement be executed to guarantee and/or secure all or any part of,
any moneys from time to time owing by the Borrower pursuant to this
Agreement (whether or not any such document also secures moneys from time
to time owing pursuant to any other document or agreement);
"Security Party" means any person who may at any time be a party to any
of the Security Documents (other than a Creditor);
"Security Period" means the period commencing on the date of this
Agreement and so long as any moneys are owing, actually or contingently,
under the Security Documents and while all or any part of the Loan or the
Commitments remain outstanding;
"Ships" means each of the ships listed in Part 1 of schedule 2 and "Ship"
means any of them;
"Ship Security Documents" means, in relation to a Ship, the Mortgage and
the General Assignment in respect of such Ship;
"Solvent" means with respect to any person on a particular date, that on
such date (i) the fair market value of the assets of such person is
greater than the total amount of liabilities (including the present or
expected value of contingent liabilities) of such person, (ii) the
present fair salable value of the assets of such person is greater than
the amount that will be required to pay the probable liabilities of such
person for its debts as they become absolute and matured, (iii) such
person is able to realise upon its assets and pay its debts and other
liabilities, including contingent obligations, as they mature, (iv) such
person does not have unreasonably small capital and (v) such person does
not intend to or believe it will incur debts beyond its ability to pay as
they mature;
"Subordinated Debt" of a person means any Indebtedness of the Borrower or
any of its Subsidiaries which is a Security Party owing to the Parent
which is subject to the Subordination Deed; "Subordination Deed" means a
deed entered or (as the context may require) to be entered into between
the Guarantors, the Borrower, Xxxxxx-Xxxxxx Shipping Corporation and the
Security Agent in the agreed form;
"Subsidiary" of a person means any company or entity directly or
indirectly controlled by such person and a "wholly owned Subsidiary" of a
person means a Subsidiary which has no members except such person and
that person's wholly owned Subsidiaries and its or their nominees;
Page 21
"Subsidiary Guarantee" means the joint and several guarantee issued or
(as the context may require) to be issued by the Owning Companies, Oxbow
and Golar Maritime in favour of the Security Agent in the agreed form;
"Subsidiary Guarantor" means any of the Owning Companies, Oxbow and Golar
Maritime and "Subsidiary Guarantors" means all of them;
"Subsidiary Pledge" means, in relation to an Owning Company, Oxbow or
Golar Maritime, the pledge of all of the issued stock of such company
executed or (as the context may require) to be executed by the Borrower
in favour of the Security Agent in the agreed form and "Subsidiary
Pledges" means all of such pledges;
"Swap Banks" means, the banks and financial institutions listed in Part 2
of schedule1 and includes their successors in title and assignees and
transferees;
"Swap Liabilities" means Indebtedness incurred in respect of swaps,
forward exchange contracts, futures and other derivatives and guarantees
in respect of such Indebtedness;
"Tax Lease Option" means the option referred to in clause 17;
"Taxes" includes all present and future taxes, levies, imposts, duties,
fees or charges of whatever nature together with interest thereon and
penalties in respect thereof and "Taxation" shall be construed
accordingly;
"Total Commitments" means, at any relevant time, the total of the
Commitments of all the Banks at such time;
"Total Loss" in relation to a Ship or Xxxxx Xxxx means:
(a) actual, constructive, compromised or arranged total loss of such
vessel; or
(b) the Compulsory Acquisition of such vessel; or
(c) the hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation of such vessel (other than where the
same amounts to the Compulsory Acquisition of such vessel) by any
Government Entity, or by persons acting or purporting to act on
behalf of any Government Entity, unless the vessel be released and
restored to the relevant Owning Company or Faraway from such
hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation within 60 days after the occurrence
thereof;
"Total Loss Repayment Date" means, in relation to a Mortgaged Ship or
Xxxxx Xxxx, the date which is the earlier of:
(a) the date one hundred and twenty (120) days after such ship became
a Total Loss or such later date as may be agreed in writing by the
Administrative Agent (acting on the instructions of the Majority
Banks) if they are satisfied that the relevant Mortgaged Ship or
Xxxxx Xxxx was properly insured at the time of such Total Loss and
that insurance proceeds in respect of such Total Loss will be
recovered in amounts sufficient to enable the Borrower to comply
with its prepayment obligations under clauses 4.3 of this
Agreement arising as a consequence of such Total Loss and will be
applied in accordance with the Security Documents by the later
date so agreed; and
Page 22
(b) the date upon which insurance proceeds or Requisition Compensation
in respect of such Total Loss are received by the relevant Owning
Company (or the Security Agent as the relevant Owning Company's
assignee pursuant to the relevant General Assignment) or Faraway;
"Transfer Certificate" means a transfer certificate for the purposes of
clause 15.3 substantially in the form set out in schedule 5 (or in such
other form as the Banks may approve or require);
"Transferee Bank" and "Transferor Bank" shall have the meaning ascribed
to those expressions in clause 15.3; and
"Underlying Documents" means collectively the Approved Charters, the
Faraway Documents, the Pertamina Charter and the Approved Management
Agreements
1.3 Insurance terms
In clause 8.4(a):
(a) "excess risks" means the proportion (if any) of claims for general
average, salvage and salvage charges and under the ordinary
collision clause not recoverable in consequence of the value at
which a Ship is assessed for the purpose of such claims exceeding
her insured value;
(b) "protection and indemnity risks" means the usual risks (including
oil pollution) covered by a United Kingdom protection and
indemnity association or a protection and indemnity association
which is managed in the United Kingdom or Norway (including,
without limitation, the proportion (if any) of any sums payable to
any other person or persons in case of collision which are not
recoverable under the hull and machinery policies by reason of the
incorporation therein of Clause 8 of the Institute Time Clauses
(Hulls) (1/11/95) or the Institute Amended Running Down Clause
(1/10/71) or any equivalent provision) or (if placed on Norwegian
terms) means protection and indemnity risks as defined in the
Norwegian Marine Insurance Plan of 1996 as amended; and
(c) "war risks" includes those risks covered by the standard form of
English marine policy with Institute War and Strikes Clauses -
Time (1/11/95) attached or similar cover or (if placed on
Norwegian terms means the war risks described in the Norwegian
Marine Insurance Plan of 1966 as amended).
1.4 Accounting terms
All accounting terms not otherwise defined in this Agreement shall have
the meanings assigned to them in accordance with GAAP (whether or not
such is indicated in this Agreement).
1.5 Headings
Clause headings and the table of contents are inserted for convenience of
reference only and shall be ignored in the interpretation of this
Agreement.
Page 23
1.6 Construction of certain terms
In any Security Document unless the context otherwise requires:
(a) references to clauses and schedules are to be construed as
references to clauses of, and schedules to, such Security Document
and references to such Security Document include its schedules;
(b) references to (or to any specified provision of) any Security
Document or any other document shall be construed as references to
such Security Document, that provision or that document as in
force for the time being and as amended in accordance with terms
thereof, or, as the case may be, with the agreement of the
relevant parties and (where such consent is, by the terms of any
Security Document or the relevant document, required to be
obtained as a condition to such amendment) with the consent of the
Administrative Agent;
(c) references to a "regulation" include any present or future
regulation, rule, directive, requirement, request or guideline
(whether or not having the force of law) of any agency, authority,
central bank or government department or any self-regulatory or
other national or supra-national authority;
(d) words importing the plural shall include the singular and vice
versa;
(e) references to a time of day are to London time;
(f) references to a person shall be construed as references to an
individual, firm, company, corporation, unincorporated body of
persons or any Government Entity;
(g) references to any person includes such person's assignees and
successors in title;
(h) references to a "guarantee" include references to an indemnity or
other assurance against financial loss including, without
limitation, an obligation to purchase assets or services as a
consequence of a default by any other person to pay any
Indebtedness and "guaranteed" shall be construed accordingly; and
(i) references to any enactment shall be deemed to include references
to such enactment as re-enacted, amended or extended.
Page 24
1.7 Majority Banks
Where this Agreement provides for any matter to be determined by
reference to the opinion of the Majority Banks or to be subject to the
consent or request of the Majority Banks or for any action to be taken on
the instructions of the Majority Banks, such opinion, consent, request or
instructions shall (as between the Banks) only be regarded as having been
validly given or issued by the Majority Banks if all the Banks shall have
received prior notice of the matter on which such opinion, consent,
request or instructions are required to be obtained and the relevant
majority of Banks shall have given or issued such opinion, consent,
request or instructions but so that the Borrower shall be entitled (and
bound) to assume that such notice shall have been duly received by each
Bank and that the relevant majority shall have been obtained to
constitute Majority Banks whether or not this is in fact the case.
1.8 Agreed forms
In this Agreement, any document expressed to be "in the agreed form"
means a document in a form agreed by (and for the purposes of
identification signed by or on behalf of) the Borrower and the
Administrative Agent or (in the case of any of the other Security
Documents) a document in the form actually executed by both the relevant
Security Party or relevant Security Parties and the Security Agent.
1.9 Meaning of "associate" and each "acting in concert"
For the purposes of this Agreement:
(a) any question whether a person is an associate of another person is
to be determined in accordance with the following provisions of
this clause (any provision that a person is an associate of
another person being taken to mean that they are associates of
each other);
(b) a person is an associate of an individual if that person is the
individual's husband or wife or is a relative, or the husband or
wife of a relative, of the individual or of the individual's
husband or wife;
(c) a person is an associate of any person with whom he is in
partnership, and of the husband or wife or a relative of any
individual with whom he is in partnership;
(d) a person is an associate of any person whom he employs or by whom
he is employed;
(e) a person in his capacity as trustee of a trust (other than a
pension scheme or an employees' share scheme) is an associate of
another person if the beneficiaries of the trust include, or the
terms of the trust confer a power that may be exercised for the
benefit of, that other person or an associate of that other
person;
Page 25
(f) a company or other entity is an associate of another company or
entity:
(i) if the same person has control of both, or a person has
control of one and persons who are his associates, or he
and persons who are his associates, have control of the
other; or
(ii) if a group of two or more persons has control of each
company or other entity, and the groups either consist of
the same persons or could be regarded as consisting of the
same persons by treating (in one or more cases) a member of
either group as replaced by a person of whom he is an
associate;
(g) a company is an associate of another person if that person is a
director of or has control of it or if that person and persons who
are his associates together have control of it;
(h) any two or more persons acting together to secure or exercise
control of a company or other entity shall be treated in relation
to that company or other entity as associates of each other and of
any person acting on the instructions of any of them to secure or
exercise control of the company or other entity,
(i) for the purposes of this clause 1.9:
(i) a person is a relative of an individual if he is that
individual's brother, sister, uncle, aunt, nephew, niece,
lineal ancestor or lineal descendant, treating:
(A) any relationship of the half blood as a relationship
of the whole blood and the stepchild or adopted
child of any person as his child; and
(B) an illegitimate child as the legitimate child of his
mother and reputed father;
and any references in this Agreement to a husband or wife
include a former husband or wife and a reputed husband or
wife;
(ii) any director or other officer of a company or other entity
is to be treated as employed by that company or other
entity;
(j) a person is to be taken as having control of a company or other
entity if:
(i) that person owns more than 50 per cent of the voting share
capital (or equivalent rights of ownership) of such company
or entity; or
(ii) such person has the power to direct the policies and
management of such company or entity by contract or
otherwise
and where two or more persons together satisfy either of the above
conditions, they are to be taken as having control of the company
or entity; and
Page 26
(k) persons acting in concert comprise persons who, pursuant to an
agreement or understanding (whether formal or informal), actively
co-operate, through the acquisition by any of them of shares in a
company to obtain or consolidate control over ten (10) per cent or
more of (i) the ordinary share capital or (ii) the voting rights
attributable to the ordinary share capital of that company and for
this purpose persons who are associates of each other shall be
presumed to be persons acting in concert unless the contrary is
demonstrated to the satisfaction of the Administrative Agent.
1.10 Calculation of Expenditure Provision
(a) When the amount of the Expenditure Provision is required for the
purposes of this Agreement as at any date any expenditure in
respect of which that Expenditure Provision applies, the
Expenditure Provision which is required to be projected by
reference to any date falling and/or any period expiring after
such date shall be calculated and projected by the Borrower in
accordance with this clause 1.10 and certified in a statement as
required by clause 8.1(e)(ii) in each case to the reasonable
satisfaction of the Administrative Agent.
(b) Such amounts or relevant part thereof shall be projected on such
assumptions as the Administrative Agent shall approve in writing
(such approval not to be unreasonably withheld) including (without
limitation) assumptions as to:
(i) the Dollar amount and timing of any expenditure in relation
to which the Expenditure Provision falls to be determined,
and
(ii) and any assumptions referred to in the definition of
Expenditure Provision.
(c) If the Administrative Agent is, after reasonable consultation with
the Borrower and after consideration of any further information
provided by the Borrower, not satisfied with the Borrower's
calculation or projection of the relevant amounts, the
Administrative Agent may recalculate such amount or projection
thereof (acting reasonably having regard to the information
available to it for such purpose and reasonable prudent
assumptions) and the amount as so recalculated by the
Administrative Agent shall be binding on the Borrower and the
Banks for the purpose of this Agreement.
2 The Commitments and the Loan
2.1 Amount
Upon and subject to the terms and conditions of this Agreement and in
reliance on the representations and warranties in clause 7, the Banks
agree to lend to the Borrower the principal sum of up to USD325,000,000.
The obligation of each Bank under this Agreement shall be to contribute
that proportion of the Loan which, as at the Drawdown Date, its
Commitment bears to the Total Commitments.
Page 27
2.2 Obligations several
The obligations of each Bank under this Agreement are several; the
failure of any Bank to perform such obligations shall not relieve any
other Bank, the Lead Arrangers, the Administrative Agent, the Security
Agent or the Borrower of any of their respective obligations or
liabilities under this Agreement nor shall the Lead Arrangers, the
Administrative Agent, or the Security Agent be responsible for the
obligations of any Bank (except for its own obligations, if any, as a
Bank) nor shall any Bank be responsible for the obligations of any other
Bank under this Agreement.
2.3 Interests several
Notwithstanding any other term of this Agreement (but without prejudice
to the provisions of this Agreement relating to or requiring action by
the Majority Banks) the interests of the Lead Arrangers, the
Administrative Agent, the Security Agent and the Banks are several and
the amount due to the Lead Arrangers, the Administrative Agent, the
Security Agent (each for its own account) and to each Bank is a separate
and independent debt. The Lead Arrangers, the Administrative Agent, the
Security Agent and any Bank shall have the right to protect and enforce
its rights arising out of this Agreement and it shall not be necessary
for the Lead Arrangers, the Administrative Agent, the Security Agent or
any Bank (as the case may be) to be joined as an additional party in any
proceedings for this purpose.
2.4 Drawdown
Subject to the terms and conditions of this Agreement, the Loan shall be
made to the Borrower following receipt by the Administrative Agent from
the Borrower of a Drawdown Notice not later than 10 a.m. (Oslo time) on
the fifth Banking Day before the proposed Drawdown Date. A Drawdown
Notice shall be effective on actual receipt by the Administrative Agent
and, once given, shall, subject as provided in clause 3.7(a), be
irrevocable.
2.5 Amount
The principal amount specified in the Drawdown Notice for borrowing on
the Drawdown Date shall, subject to the terms and conditions of this
Agreement, not exceed USD325,000,000.
2.6 Availability
Upon receipt of a Drawdown Notice complying with the terms of this
Agreement the Administrative Agent shall promptly notify each Bank
thereof and of the date on which the Loan is to be made and, subject to
the provisions of clause 8.6, on such date on which the Loan is to be
drawn down each of the Banks shall make available to the Administrative
Agent its portion of the Loan for payment by the Administrative Agent in
accordance with clause 6.2.
2.7 Application of proceeds
Without prejudice to the Borrower's obligations under clause 8.1(c), none
of the Creditors shall have any responsibility for the application of
proceeds of the Loan by the Borrower.
2.8 Termination of Commitments
If the Loan is not drawn down by the Latest Drawdown Date, the
Commitments shall thereupon be automatically cancelled.
Page 28
3 Interest
3.1 Normal interest rate
The Borrower shall pay interest on the Loan in respect of each Interest
Period relating thereto on each Rollover Date (or, in the case of an
Interest Period of more than three months, by instalments, the first
three months from the commencement of such Interest Period and the
subsequent instalments at intervals of three months or, if shorter, the
period from the date of the preceding instalment until the Rollover Date
relative to such Interest Period) at the rate per annum determined by the
Administrative Agent to be the aggregate of (a) the Margin, (b) the
Additional Cost (if any) and (c) LIBOR. Any portion of the interest equal
to Additional Cost shall be for the account of Banks whose participation
in the Loan is subject to the Additional Cost.
3.2 Selection of Interest Periods
The Borrower may by notice received by the Administrative Agent not later
than 10 a.m. (Oslo time) on the third Banking Day before the beginning of
each Interest Period specify whether such Interest Period shall have a
duration of one (1), three (3) or six (6) months (or such other period as
the Borrower may select and all of the Banks may agree in writing) but
the Borrower may not select an Interest Period of one month's duration if
there have, during the preceding period of twelve months, commenced two
Interest Periods of one month's duration.
3.3 Determination of Interest Periods
Every Interest Period shall be of the duration specified by the Borrower
pursuant to clause 3.2 but so that:
(a) the first Interest Period in respect of the Loan shall commence on
the Drawdown Date and each subsequent Interest Period for the Loan
shall commence on the last day of the previous Interest Period;
(b) if any Interest Period would otherwise overrun a Repayment Date,
then the Loan shall be divided into parts, so that there is one
part in the aggregate amount of the repayment instalment due on
each Repayment Date falling during that Interest Period and having
an Interest Period ending on the relevant Repayment Date and
another part in the amount of the balance of the Loan having an
Interest Period ascertained in accordance with clause 3.2 and the
other provisions of this clause 3.3; and
(c) if the Borrower fails to specify the duration of an Interest
Period in accordance with the provisions of clause 3.2 and this
clause 3.3 such Interest Period shall have a duration of three (3)
months or such other period as shall comply with this clause 3.3.
3.4 Default interest
If the Borrower fails to pay any sum (including, without limitation, any
sum payable pursuant to this clause 3.4) on its due date for payment
under any of the Security Documents, the Borrower shall pay interest on
such sum on demand from the due date up to the date of actual payment (as
well after as before judgment) at a rate determined by the Administrative
Agent pursuant to this clause 3.4. The period beginning on such due date
and ending on such date of payment shall be divided into successive
periods of not more than three months as selected by the Administrative
Agent (after consultation with the Banks) each of which (other than the
first, which shall commence on such due date) shall commence on the last
day of the preceding such period. The rate of interest applicable to each
such period shall be the aggregate (as determined by the Administrative
Agent of (a) two per cent (2%) per annum, (b) Margin, (c) the Additional
Cost and (d) LIBOR for such period provided that if such unpaid sum is an
amount of principal which became due and payable, by reason of a
declaration by the Administrative Agent under clause 10.2(a) or a
prepayment pursuant to clauses 4.3, 4.6, 4.7 or 12.1 on a date other than
a Repayment Date relating thereto, the first such period selected by the
Administrative Agent shall be of a duration equal to the period between
the due date of such principal sum and such Repayment Date and interest
shall be payable on such principal sum during such period at a rate of
two per cent (2%) per annum above the aggregate of the Margin, the
Additional Cost and the rate of LIBOR applicable thereto immediately
before it shall have become so due and payable. Default interest shall be
due and payable on the last day of each such period as determined by the
Administrative Agent pursuant to this clause 3.4 or, if earlier, on the
date on which the sum in respect of which such default interest is
accruing shall actually be paid. If, for the reasons specified in clause
3.7(a) the Administrative Agent is unable to determine a rate in
Page 29
accordance with the foregoing provisions of this clause 3.4, each Bank
shall promptly notify the Administrative Agent of the cost of funds to
such Bank and interest on any sum not paid on its due date for payment
shall be calculated for each Bank at a rate determined by the
Administrative Agent to be two per cent (2%) per annum above the
aggregate of the Margin, the Additional Cost and the cost of funds to
such Bank. Each Bank shall (without prejudice to the obligation of the
Borrower to pay such interest) provide reasonable detail as to the basis
on which it has determined such cost of funds.
3.5 Notification of interest rate
The Administrative Agent shall notify the Borrower and the Banks promptly
of each rate of interest determined by it under this clause 3.
3.6 Reference Bank quotations
If any Reference Bank is unable or otherwise fails to furnish a quotation
for the purpose of calculating LIBOR pursuant to the proviso contained in
the definition of LIBOR the interest rate shall be determined, subject to
clause 3.7, on the basis of the quotations furnished by the remaining
Reference Banks.
3.7 Market disruption; non-availability
(a) If and whenever, at any time prior to the commencement of any
Interest Period:
(i) the Administrative Agent shall have determined (which
determination shall, in the absence of manifest error, be
conclusive) that adequate and fair means do not exist for
ascertaining LIBOR during such Interest Period in
accordance with the definition of LIBOR in clause 1.2; or
(ii) where applicable, none of the Reference Banks supplies the
Administrative Agent with a quotation for the purpose of
calculating LIBOR; or
(iii) the Administrative Agent shall have received notification
from Banks with Contributions aggregating more than one
third of the Loan (or, prior to the Drawdown Date,
Commitments aggregating not less than one third of the
Total Commitments) that deposits in Dollars are not
available to such Banks in the London Interbank Market in
the ordinary course of business in sufficient amounts to
fund their Contributions for such Interest Period or, where
applicable in accordance with the definition of LIBOR in
clause 1.2, that the arithmetic mean of the quotations for
LIBOR supplied by the Reference Banks does not accurately
reflect the cost to such Banks of obtaining such deposits,
the Administrative Agent shall forthwith give notice (a
"Determination Notice") thereof to the Borrower and to each of the
Banks. A Determination Notice shall contain particulars of the
relevant circumstances giving rise to its issue.
(b) After the giving of any Determination Notice, the undrawn amount
of the Commitment shall not be borrowed until notice to the
contrary is given to the Borrower by the Administrative Agent.
Page 30
(c) During the period of 10 days after any Determination Notice has
been given by the Administrative Agent under clause 3.7(a) each
Bank shall certify an alternative basis (the "Substitute Basis")
for maintaining its Contribution. The Substitute Basis may
(without limitation) include alternative interest periods,
alternative currencies or alternative rates of interest but shall
include a margin above the cost of funds (including Additional
Cost if any) to such Bank equivalent to the Margin. Each
Substitute Basis so certified shall be binding upon the Borrower
and shall take effect in accordance with its terms from the date
specified in the Determination Notice until such time as the
Administrative Agent notifies the Borrower that none of the
circumstances specified in clause 3.7(a) continues to exist
whereupon the normal interest rate fixing provisions of the
Agreement shall apply.
4 Repayment and prepayment
4.1 Repayment
The Borrower shall repay the Loan by twenty three (23) instalments, one
such instalment to be repaid on each of the Repayment Dates. Subject to
the provisions of this Agreement:
(a) the first eight (8) instalments shall each be in the amount of
USD5,000,000;
(b) the ninth (9th) to the sixteenth (16th) instalments shall each be
in the amount of USD7,500,000;
(c) the seventeenth (17th) to the twentieth (20th) instalments shall
each be in the amount of USD10,000,000;
(d) the twenty first (21st) and twenty second (22nd) instalments shall
each be in the amount of USD12,500,000; and
(e) the twenty third and final instalment shall be in the amount of
USD160,000,000.
If the amount of the Loan advanced on the Drawdown Date is less than
USD325,000,000, each of the said amounts shall be reduced pro rata to the
amount so advanced.
4.2 Voluntary prepayment
The Borrower may prepay the Loan in whole or in part (being USD1,000,000
or whole multiples of USD1,000,000) on any Rollover Date relating to the
part of the Loan to be prepaid without premium or penalty subject always
to the payment by the Borrower of any Breakage Costs in accordance with
clause 11.1 hereof and provided that immediately prior to, and
immediately after such prepayment, the Borrower will be in compliance
with the financial covenants in clause 8.5,
4.3 Prepayment on Total Loss and sale, etc.
(a) Before Drawdown Date
On a Ship or Xxxxx Xxxx becoming a Total Loss (or suffering damage
or being involved in an incident which in the opinion of the
Administrative Agent, in consultation with the Borrower, may
result in such Ship or Xxxxx Xxxx subsequently being determined to
be a Total Loss) before the Drawdown Date, the obligation of the
Banks to advance the Loan shall immediately cease and the
Commitments shall be reduced to zero.
(b) Thereafter
If, on or after the Drawdown Date:
(i) a Mortgaged Ship or Xxxxx Xxxx becomes a Total Loss;
(ii) a Mortgaged Ship or Xxxxx Xxxx is sold;
(iii) an Owning Company is sold by the Borrower (unless such
Owning Company has already sold or refinanced its Ship or
such Ship has become a Total Loss); or
(iv) Oxbow or Golar Maritime sells any of their shares in
Faraway (unless Xxxxx Xxxx has already been sold by Faraway
or has become a Total Loss),
Page 31
the Commitments shall be reduced on the applicable Disposal
Repayment Date by the relevant Disposal Repayment Amount. If, upon
reduction of the Commitments by such Disposal Repayment Amount,
the aggregate of the Contributions at such time exceeds the
Commitments as thereby reduced, the Borrower shall on such
Disposal Repayment Date prepay such amount of the Loan as will
ensure that immediately thereafter the aggregate amount of the
Contributions will not exceed the Commitments as so reduced.
(c) Defined terms
For the purposes of this clause 4.3:
"Disposal Repayment Amount" means in relation to a Disposal
Reduction Date, the amount in Dollars which is either:
(i) in relation to a Ship which has become a Total Loss, the
amount which is 115% of the Relevant Fraction of the Loan
as at the Disposal Reduction Date; or
(ii) in relation to Xxxxx Xxxx where it has become a Total Loss,
60% of the minimum amount for which Xxxxx Xxxx was required
to have been insured under this Agreement (after taking
into account the amount due under the Faraway Loan
Agreement and other liabilities in respect of such vessel
(but not liabilities owed to any Restricted Associate)); or
(iii) in relation to a Ship which is being sold, the amount which
is 115% of the Relevant Fraction of the Loan as at the
Disposal Reduction Date; or
(iv) in relation to Xxxxx Xxxx where it has been sold, 60% of
the value of Xxxxx Xxxx as determined in accordance with
clause 4.3(d) (after taking into account the amount due
under the Faraway Loan Agreement and other liabilities in
respect of such vessel (but not liabilities owed to any
Restricted Associate)); or
(v) in relation to a sale of an Owning Company, the amount
which is the higher of:
(A) the value of such Owning Company determined in
accordance with clause 4.3(d); and
(B) the value of such Owning Company's Ship as
determined in accordance with clause 4.3(d); or
(vi) in relation to a sale of Oxbow and Golar Maritime shares in
Faraway, the amount which is the higher of:
(A) the value of such shares determined in accordance
with clause 4.3(d); and
(B) 60% of the value of Xxxxx Xxxx determined in
accordance with clause 4.3(d) and other liabilities
(but not liabilities owed to any Restricted
Associate)); and
Page 32
"Disposal Repayment Date" means:
(i) where a Ship or Xxxxx Xxxx has become a Total Loss, its
Total Loss Repayment Date; or
(ii) where a Ship is being sold in accordance with clause
8.4(n), the date upon which the sale of such Ship is
completed by the transfer of title to such Ship to the
purchaser in exchange for payment of the relevant purchase
price; or
(iii) where Xxxxx Xxxx is being sold, the last day of the
calendar quarter during which the sale of Xxxxx Xxxx was
completed or, if earlier, the date upon which 60% of all or
substantially all of the proceeds of sale of Xxxxx Xxxx
(net of any amounts due under the Faraway Loan Agreement
and any other liabilities (but not liabilities owed to any
Restricted Associate)) are distributed to Oxbow and Golar
Maritime by or on behalf of Faraway (whether by way of
dividend or otherwise); or
(iv) where an Owning company is being sold, or Oxbow and Golar
Maritime are selling any of their shares in Faraway, the
date upon which such sale is completed.
(d) Valuation of Ships, Owning Companies and Faraway shares
(i) Ships
For the purposes of this clause 4.3 and to determine the
Relevant Fraction of the Loan, the Mortgaged Ships shall be
valued in accordance with clause 8.2 at the cost of the
Borrower save that, in the case of the sale of such a Ship,
the value of such Mortgaged Ship shall, for the purposes of
this clause, be deemed to be the Net Sale Proceeds of such
Ship or, if higher and if the purchaser is a Restricted
Associate, the value of such Mortgaged Ship as determined
in accordance with clause 8.2.
(ii) Xxxxx Xxxx
For the purposes of this clause 4.3, the value of Xxxxx
Xxxx shall be 60% of its value as determined in accordance
with clause 8.2, as at the relevant Disposal Repayment
Date, save that, in the case of a sale of Xxxxx Xxxx, the
value of Xxxxx Xxxx shall be deemed to be 60% of the Net
Sale Proceeds of Xxxxx Xxxx or, if higher, and if the
purchaser is a Restricted Associate, 60% of the value of
Xxxxx Xxxx as determined in accordance with clause 8.2.
(iii) Owning Companies
For the purposes of this clause 4.3, the value of an Owning
Company shall be the proceeds of sale of such Owning
Company or, if higher and if the purchaser of the Owning
Company is a Restricted Associate, an amount equal to the
value of such Owning Company's Ship as at the relevant
Disposal Repayment Date which shall be determined in
accordance with clause 8.2.
(iv) Faraway shares
For the purposes of this clause 4.3, the value of Oxbow and
Golar Maritime's shares in Faraway shall be the proceeds of
sale of such shares or, if higher and if the purchaser of
such shares is a Restricted Associate, be deemed to be the
higher of 1) 60% of the value of Xxxxx Xxxx as determined
in accordance with clause 8.2 (net of amounts owing under
the Faraway Loan Agreement and any other liabilities in
respect of such vessel other than to Restricted Associates)
and 2) 60% of the net asset value of Faraway (being for
this purpose the aggregate of the value of Xxxxx Xxxx as
determined in accordance with clause 8.2 and the value of
the other assets of Faraway as shown in the latest accounts
of Faraway delivered to the Administrative Agent under
clause 8.6 less amounts owing to the financiers of Xxxxx
Xxxx and any other liabilities of Faraway other than
liabilities owed to any Restricted Associate) as at the
relevant Disposal Repayment Date.
Page 33
(e) Valuation conclusive and costs
The values determined in accordance with clause 4.3(d) shall be
binding upon the parties hereto for the purposes of determining
the Disposal Reduction Amount for a Disposal Reduction Date and
all costs in connection with the Administrative Agent obtaining
any valuation for such purpose shall be borne by the Borrower.
(f) Date of Total Loss
For the purpose of this Agreement, a Total Loss shall be deemed to
have occurred:
(i) in the case of an actual total loss of a vessel on the
actual date and at the time such vessel was lost or, if
such date is not known, on the date on which the vessel was
last reported;
(ii) in the case of a constructive total loss of a vessel, upon
the date and at the time notice of abandonment of such
vessel is given to the insurers of such vessel for the time
being (provided a claim for total loss is admitted by such
insurers) or, if such insurers do not forthwith admit such
a claim, at the date and at the time at which either a
total loss is subsequently admitted by the insurers or a
total loss is subsequently adjudged by a competent court of
law or arbitration panel to have occurred or, if earlier,
the date falling six months after notice of abandonment of
such vessel was given to the insurers;
(iii) in the case of a compromised or arranged total loss, on the
date upon which a binding agreement as to such compromised
or arranged total loss has been entered into by the
insurers of the relevant vessel;
(iv) in the case of Compulsory Acquisition of a vessel, on the
date upon which the relevant requisition of title or other
compulsory acquisition of such vessel occurs; and
(v) in the case of hijacking, theft, condemnation, capture,
seizure, arrest, detention or confiscation of a vessel
(other than where the same amounts to Compulsory
Acquisition of such vessel) by any Government Entity, or by
persons purporting to act on behalf of any Government
Entity, which deprives the owner of the vessel of the use
of such vessel for more than 60 days, upon the expiry of
the period of 60 days after the date upon which the
relevant hijacking, theft, condemnation, capture, seizure,
arrest, detention or confiscation occurred.
(g) Application of Total Loss and sale proceeds
Provided no Default has occurred and is continuing and provided
the Borrower shall have complied with clauses 4.3 and 4.4, any of
the following moneys:
(i) insurance moneys or Requisition Compensation in respect of
a Total Loss of a Ship; or
(ii) any proceeds of sale of a Ship, an Owning Company or any of
Oxbow and Golar Maritime's shares in Faraway; or
(iii) moneys distributed by or on behalf of Faraway representing
60% of all or substantially all of any insurance moneys or
Requisition Compensation in respect of a Total Loss of
Xxxxx Xxxx or proceeds of sale of Xxxxx Xxxx (in each case
net of any amounts due under the Faraway Loan Agreement and
other liabilities in respect of such vessel other than
liabilities owed to any Restricted Associate);
Page 34
received by the Administrative Agent or the Security Agent
pursuant to any Security Document shall be paid to the relevant
Owning Company or Oxbow and Golar Maritime or (if and to the
extent necessary to ensure compliance with clause 4.3) retained by
the Administrative Agent for application in or towards making any
prepayment and paying any other moneys required under clauses 4.3
and 4.4. For this purpose, any such moneys so received (or the
relevant part thereof) may be applied, if the Borrower and the
Security Party to whom such moneys belong so requests the
Administrative Agent in writing before the date of receipt
thereof, in effecting any prepayment required in accordance with
clause 4.3 and paying related amounts due under clause 4.5. The
surplus (if any) remaining after such payments shall be paid to
the Earnings Account for application in accordance with clause 4
of the Agency Agreement.
4.4 Amounts payable on prepayment
Any prepayment under this Agreement shall be made together with:
(a) accrued interest on the amount to be prepaid to the date of such
prepayment (calculated in respect of the period during which the
relevant Substitute Basis has applied by virtue of clause 3.7(c),
at a rate per annum equal to the aggregate of (i) the Margin and
(ii) the cost (including any Additional Cost) to such Bank of
funding its Contribution for such period);
(b) any additional amounts payable under clauses 6.7 and 12.2; and
(c) all other sums payable by the Borrower to the relevant Bank under
this Agreement or any of the other Security Documents including,
without limitation any amounts payable under clause 11.
4.5 Notice of prepayment; reduction of repayment instalments
No prepayment may be effected under clause 4.2 or 4.6 unless the Borrower
shall have given the Administrative Agent at least ten Banking Days'
notice of its intention to make such prepayment. Every notice of
prepayment shall be effective only on actual receipt by the
Administrative Agent, shall be irrevocable, shall specify the amount to
be prepaid and shall oblige the Borrower to make such prepayment on the
date specified. No amount prepaid may be reborrowed. Any amount prepaid
under clause 4.2 shall be applied in reducing the repayment instalments
under clause 4.1 in inverse order of maturity or (if the Borrower so
requests in writing in the notice of its intention to make such
prepayment) in order of maturity. Any amount prepaid pursuant to clause
4.3 (other than amounts prepaid due to a sale or Total Loss of Xxxxx Xxxx
or a sale of shares in Faraway which shall be applied in inverse order of
maturity) shall be applied in reducing the repayment instalments under
clause 4.1 pro rata. Any amount prepaid under clause 4.6 or 4.7 shall be
applied in reducing the repayment instalments under clause 4.1 in inverse
order of maturity.
The Borrower may not prepay the Loan or any part thereof save as
expressly provided in this Agreement.
4.6 Additional voluntary prepayment
The Borrower may also prepay (in whole but not in part only), without
premium or penalty, but without prejudice to its obligations under
clauses 3.7, 6.7 and 12.2:
(a) the Contribution of any Bank to which the Borrower shall have
become obliged to pay additional amounts under clauses 6.7 or
12.2; or
(b) any Bank's Contribution to which a Substitute Basis applies by
virtue of clause 3.7(c).
Page 35
Upon any notice of such prepayment being given, the Commitment of the
relevant Bank shall be reduced to zero and for the avoidance of doubt,
any amount prepaid under this clause 4.6 shall be applied in reducing the
repayment instalments under clause 4.1 pro rata.
4.7 Faraway dividends
Upon receipt (whether by payment to an Earnings Account or otherwise) by
Oxbow and/or Golar Maritime of any dividend or other amount from
Faraway), the Borrower shall immediately prepay such part of the Loan as
is equal to one third of such part of such dividend or other amount as
was funded by cash received by Faraway after the Drawdown Date and in
respect of amounts accrued after the Drawdown Date.
5 Fees commission and expenses
5.1 Fees and commissions
The Borrower shall pay to the Administrative Agent:
(a) Arrangement fee
on the date of this Agreement, for the account of the
Administrative Agent (for distribution between itself and the
other Lead Arrangers in proportion to their respective
Commitments), an arrangement fee of an amount agreed between the
Borrower and the Lead Arrangers in a separate letter;
(b) Commitment commission
on the dates falling at three (3) monthly intervals from 15 May
2001 (the "underwriting date") and prior to the Drawdown Date, and
on the Drawdown Date itself or (if applicable) the date of
cancellation in full of the Total Commitments, for the account of
each Bank, commitment commission computed from the underwriting
date at the rate of 0.625% (zero point six two five per cent) per
annum on the amount of the daily undrawn and uncancelled amount of
such Bank's Commitment; and
(c) Agency fee
in advance on the Drawdown Date and on each anniversary of the
date of this Agreement until no moneys are owing under the
Security Documents and the Borrower is no longer under any
obligation, actual or contingent, under this Agreement, for the
account of the Administrative Agent, an agency fee of an amount
agreed between the Borrower and the Administrative Agent in a
separate letter.
The fees and commission referred to in clauses 5.1(a) and 5.1(b) shall be
payable by the Borrower whether or not the Loan is ever made.
5.2 Expenses
The Borrower shall pay to the Administrative Agent on a full indemnity
basis on demand all reasonable expenses (including legal, printing and
out-of-pocket expenses) incurred:
(a) by any of the Creditors in connection with the negotiation,
preparation, execution and, where relevant, registration of the
Security Documents, the syndication of the Loan (including,
without limitation, preparation of any information memoranda) and
of any amendment or extension of or the granting of any waiver or
consent under, any of the Security Documents; and
(b) any of the Creditors in contemplation of, or otherwise in
connection with, the enforcement of, or preservation of any rights
under, any of the Security Documents or otherwise in respect of
the moneys owing under any of the Security Documents
Page 36
together with interest at the rate referred to in clause 3.4 from the
date on which such expenses were incurred, to the date of payment (as
well after as before judgment).
5.3 Value added tax
All fees, commissions and expenses payable pursuant to this clause 5
shall be paid together with an amount equal to any value added tax
payable by any Creditor in respect of such fees and expenses. Any value
added tax chargeable in respect of any services supplied by any Creditor
under this Agreement shall, on delivery of a value added tax invoice, be
paid in addition to any sum agreed to be paid hereunder.
5.4 Stamp and other duties
The Borrower shall pay all stamp, documentary, registration or other like
duties or taxes (including any duties or taxes payable by the Creditors)
imposed on or in connection with any of the Underlying Documents or the
Security Documents and shall indemnify the Creditors against any
liability arising by reason of any delay or omission by the Borrower to
pay such duties or taxes.
6 Payments and taxes; accounts and calculations
6.1 No set-off or counterclaim; distribution to the Banks
The Borrower acknowledges that in performing their obligations under this
Agreement, the Banks will be incurring liabilities to third parties in
relation to the funding of amounts to the Borrower, such liabilities
matching the liabilities of the Borrower to the Banks and that it is
reasonable for the Banks to be entitled to receive payments from the
Borrower gross on the due date in order that the Banks are put in a
position to perform their matching obligations to the relevant third
parties. Accordingly all payments to be made by the Borrower under any of
the Security Documents shall be made in full, without any set-off or
counterclaim whatsoever and, subject as provided in clause 6.7, free and
clear of any deductions or withholdings, in Dollars (except for costs,
charges or expenses which shall, at the request of the Administrative
Agent, be payable in the currency in which they are incurred) on the due
date to the account of the Administrative Agent at such bank as the
Administrative Agent may from time to time specify for this purpose. Save
where this Agreement specifically provides for a payment to be made for
the account of a particular Bank (including, without limitation, clauses
3.1, 4.6, 5.2, 6.7, 11.1, 11.2, 11.3, 12.1 and 12.2) in which case the
Administrative Agent shall distribute the relevant payment to the Bank
concerned, payments to be made by the Borrower under this Agreement shall
be for the account of all the Banks and the Administrative Agent shall
forthwith distribute such payments in like funds as are received by the
Administrative Agent to the Banks rateably in accordance with their
Commitments or Contributions, as the case may be.
6.2 Payments by the Banks
All sums to be advanced by the Banks to the Borrower under this Agreement
shall be remitted in Dollars on the Drawdown Date to the account of the
Administrative Agent at such bank as the Administrative Agent may have
notified to the Banks and shall be paid by the Administrative Agent on
such date in like funds as are received by the Administrative Agent to
the account specified in the Drawdown Notice.
6.3 Administrative Agent may assume receipt
Where any sum is to be paid under any of the Security Documents to the
Administrative Agent for the account of another person, the
Administrative Agent may assume that the payment will be made when due
and the Administrative Agent may (but shall not be obliged to) make such
sum available to the person so entitled. If it proves to be the case that
such payment was not made to the Administrative Agent, then the person to
whom such sum was so made available shall on request refund such sum to
the Administrative Agent together with interest thereon sufficient to
compensate the Administrative Agent for the cost of making available such
sum up to the date of such repayment and the person by whom such sum was
payable shall indemnify the Administrative Agent and/or person to whom
such sum was made available by the Administrative Agent for any and all
loss or expense which the Administrative Agent or such person may sustain
or incur as a consequence of such sum not having been paid on its due
date.
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6.4 Non-Banking Days
When any payment under any of the Security Documents would otherwise be
due, or any Repayment Date would otherwise fall, on a day which is not a
Banking Day, the due date for payment or (as the case may be) such
Repayment Date shall be extended to the next following Banking Day unless
such Banking Day falls in the next calendar month in which case payment
shall be made, or (as the case may be) such Repayment Date shall fall, on
the immediately preceding Banking Day.
6.5 Calculations
All interest, commissions, fees and other payments of an annual nature
under any of the Security Documents shall accrue from day to day and be
calculated on the basis of actual days elapsed and a 360 day year.
6.6 Certificates conclusive
Any certificate or determination of the Administrative Agent or any Bank
as to any rate of interest or any other amount pursuant to and for the
purposes of any of the Security Documents shall, in the absence of
manifest error, be conclusive and binding on the Borrower and (in the
case of a certificate or determination by the Administrative Agent) on
the Banks.
6.7 Grossing-up for Taxes
If at any time the Borrower is required to make any deduction or
withholding in respect of Taxes from any payment due under any of the
Security Documents for the account of any Creditor (or if the
Administrative Agent is required to make any deduction or withholding
from a payment to another Creditor, the sum due from the Borrower in
respect of such payment shall, be increased to the extent necessary to
ensure that, after the making of such deduction or withholding, the
relevant Creditor receives on the due date for such payment (and retains,
free from any liability in respect of such deduction or withholding), a
net sum equal to the sum which it would have received had no such
deduction or withholding been required to be made and the Borrower shall
indemnify each Creditor against any losses or costs incurred by such
Creditor by reason of any failure of the Borrower to make any such
deduction or withholding or by reason of any increased payment not being
made on the due date for such payment. The Borrower shall promptly
deliver to the Administrative Agent any receipts, certificates or other
proof evidencing the amounts (if any) paid or payable in respect of any
deduction or withholding as aforesaid.
6.8 Grossing-up for Taxes - Banks
If at any time any Bank is required to make any deduction or withholding
in respect of Taxes from any payment due under any of the Security
Documents for the account of the Administrative Agent or the Security
Agent, the sum due from such Bank in respect of such payment shall be
increased to the extent necessary to ensure that, after the making of
such deduction or withholding, the Administrative Agent and the Security
Agent receives on the due date for such payment (and retains free from
any liability in respect of such deduction or withholding) a net sum
equal to the sum which it would have received had no such deduction or
withholding been required to be made and each Bank shall indemnify the
Administrative Agent and the Security Agent against any losses or costs
incurred by either of them by reason of any failure of such Bank to make
any such deduction or withholding or by reason of any increased payment
not being made on the due date for such payment.
6.9 Bank accounts
Each Bank shall maintain, in accordance with its usual practice, an
account or accounts evidencing the amounts from time to time lent by,
owing to and paid to it under the Security Documents. The Administrative
Agent shall maintain a control account showing the Loan and other sums
owing to the Administrative Agent, the Security Agent and the Banks under
the Security Documents and all payments in respect thereof made from time
to time. The control account shall, in the absence of manifest error, be
conclusive as to the amount from time to time owing to the Administrative
Agent, the Security Agent and the Banks under the Security Documents.
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6.10 Partial payments
If, on any date on which a payment is due to be made by the Borrower
under any of the Security Documents, the amount received by the
Administrative Agent from the Borrower falls short of the total amount of
the payment due to be made by the Borrower on such date then, without
prejudice to any rights or remedies available to the Administrative
Agent, the Security Agent and the Banks under any of the Security
Documents, the Administrative Agent shall apply the amount actually
received from the Borrower in or towards discharge of the obligations of
the Borrower under the Security Documents in the following order,
notwithstanding any appropriation made, or purported to be made, by the
Borrower:
(a) firstly, in or towards payment, on a pro-rata basis, of any unpaid
fees, costs and expenses of the Administrative Agent and the
Security Agent under any of the Security Documents;
(b) secondly, in or towards payment to the Lead Arrangers of any
portion of the arrangement fee payable under clause 5.1(a) which
remains unpaid;
(c) thirdly, in or towards payment to the Banks, on a pro rata basis,
of any accrued commitment commission payable under clause 5.1(b)
which shall have become due but remains unpaid;
(d) fourthly, in or towards payment to the Administrative Agent, of
any proportion of the agency fee payable under clause 5.1(c) which
shall have become due but remains unpaid;
(e) fifthly, in or towards payment to the Banks, on a pro-rata basis,
of any accrued interest which shall have become due but remains
unpaid;
(f) sixthly, in or towards payment to the Banks, on a pro-rata basis,
of any principal which shall have become due but remains unpaid;
and
(g) seventhly, in or towards payment of any other sum which shall have
become due but remains unpaid (and, if more than one such sum so
remains unpaid, on a pro-rata basis).
The order of application set out in this clause 6.10(b) to (g) may be
varied by the Administrative Agent if all the Banks so direct.
7 Representations and warranties
7.1 Continuing representations and warranties
The Borrower represents and warrants to each of the Creditors that:
(a) Due incorporation
each of the Security Parties is duly incorporated and validly
existing under the laws of its country of incorporation as a
limited liability company and has power to carry on its business
as it is now being conducted and to own its property and other
assets;
(b) Corporate power
the Borrower has power to borrow the Commitments and each of the
Security Parties has power to execute and deliver and perform its
obligations under the Security Documents and the Underlying
Documents to which it is or is to be a party; all necessary
corporate, shareholder and other action has been taken to
authorise the execution, delivery and performance of the same and
no limitation on the powers of any Security Party to borrow will
be exceeded as a result of the obligations of such Security Party
under the Security Documents;
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(c) Binding obligations
the Security Documents constitute or will, when executed,
constitute valid, legally binding and enforceable obligations of
the relevant Security Parties;
(d) No conflict with other obligations
the execution and delivery of, the performance of its obligations
under, and compliance with the provisions of, the relevant
Underlying Documents and the Security Documents by the relevant
Security Parties will not:
(i) contravene any existing applicable law, statute, rule or
regulation or any judgment, decree or permit to which any
Security Party is subject;
(ii) conflict with, or result in any breach of any of the terms
of, or constitute a default under, any agreement or other
instrument to which any Security Party is a party or is
subject or by which it or any of its property is bound;
(iii) contravene or conflict with any provision of the
constitutional documents of any Security Party; or
(iv) result in the creation or imposition of or oblige any
Security Party or any other member of the Golar Gas Group
to create any Encumbrance (other than a Permitted
Encumbrance) on any of the undertakings, assets, rights or
revenues of any Security Party or any other member of the
Golar Gas Group;
(e) No filings required
save for the registration of the Mortgages with the relevant
Registry under the laws of the relevant Flag State, the
registration or presentation of particulars of charge of any of
the Security Documents in the British Virgin Islands or England
with the relevant Registrar of Companies, it is not necessary to
ensure the legality, validity, enforceability or admissibility in
evidence of the Underlying Documents or any of the Security
Documents that they or any other instrument be notarised, filed,
recorded, registered or enrolled in any court, public office or
elsewhere in any Relevant Jurisdiction or that any stamp,
registration or similar tax or charge be paid in any Relevant
Jurisdiction on or in relation to the Underlying Documents and
each of the Underlying Documents and the Security Documents is in
proper form for its enforcement in the courts of each Relevant
Jurisdiction except that for enforcement of any such document in a
court of competent jurisdiction in Liberia, a stamp must be
affixed to such document prior to its presentation to the court;
(f) Choice of law
the choice of English law to govern the Underlying Documents, the
Security Documents (other than the Mortgages) and the submissions
therein by the Security Parties to the non-exclusive jurisdiction
of the English courts are valid and binding;
(g) No immunity
no Security Party nor any of its assets is entitled to immunity on
the grounds of sovereignty or otherwise from any legal action or
proceeding (which shall include, without limitation, suit,
attachment prior to judgement, execution or other enforcement);
(h) Owning Companies, Oxbow and Golar Maritime Subsidiaries of the
Borrower
each of the Owning Companies (other than Golar Gas Cryogenics
Inc.) and Golar Maritime is a wholly owned Subsidiary of the
Borrower and Golar Gas Cryogenics Inc. and Oxbow will on the
Drawdown Date be wholly owned Subsidiaries of the Borrower; and
Page 40
(i) Shareholdings in the Borrower
the Parent will on the Drawdown Date own directly or indirectly,
legally and beneficially, all the issued share capital of the
Borrower.
7.2 Initial representations and warranties
The Borrower represents and warrants (and shall be deemed to represent
and warrant) to each of the Creditors:
(a) No default in respect of other Indebtedness
no Security Party nor any other member of the Golar LNG Group is
(nor would with the giving of notice or lapse of time or the
satisfaction of any other condition or combination thereof be) in
breach of or in default under any agreement relating to
Indebtedness to which it is a party or by which it may be bound
and no member of the Golar Gas Group is liable for Borrowed Money
or Swap Liabilities save as are permitted by clause 8.3(i);
(b) Information
the information and reports furnished by any Security Party to the
Administrative Agent, the Lead Arrangers, the Security Agent or
the Banks in connection with the negotiation and preparation of
the Security Documents was, to the best of such Security Party's
and the Borrower's knowledge and belief fair and accurate in all
material respects when given (or, in the case of any projections,
was based on reasonable assumptions) subject to any qualifications
given in writing at the time of giving such information or
contained within such information and there are no other facts the
omission of which would have made any fact or statement therein
misleading in any material respect;
(c) Compliance with Environmental Laws and Approvals
except as may already have been disclosed by the Borrower prior to
the date of this Agreement in writing to, and acknowledged in
writing by, the Administrative Agent:
(i) to the best of the Borrower's knowledge and belief after
due enquiry, all members of the Golar LNG Group have
complied in all respects with the provisions of all
applicable Environmental Laws;
(ii) to the best of the Borrower's knowledge and belief after
due enquiry, all members of the Golar LNG Group have
obtained all Environmental Approvals and are in compliance
in all respects with all such applicable Environmental
Approvals; and
(iii) no member of the Golar LNG Group has received any notice of
any Environmental Claim against any member of the Golar LNG
Group, Faraway, any Ship or Xxxxx Xxxx;
Page 41
(d) No Environmental Claims
except as may already have been disclosed by the Borrower prior to
the date of this Agreement in writing to, and acknowledged in
writing by, the Administrative Agent, there is no Environmental
Claim pending or, to the best of the Borrower's knowledge and
belief after due enquiry, threatened against any member of the
Golar LNG Group, Faraway, any Ship or Xxxxx Xxxx;
(e) No Environmental incidents
except as may already have been disclosed by the Borrower prior to
the date of this Agreement in writing to, and acknowledged in
writing by, the Administrative Agent, to the best of the
Borrower's knowledge and belief after due enquiry there has been
no emission, spill, release or discharge of a Pollutant from any
Ship or Xxxxx Xxxx;
(f) No other Environmental problems
except as may have already been disclosed by the Borrower prior to
the date of this Agreement in writing to and acknowledged in
writing by, the Administrative Agent, to the best of the knowledge
and belief of the Borrower and its directors and other officers
(having made due enquiry) there are no circumstances arising from
any breach of Environmental Laws or which may give rise to an
Environmental Claim which constitutes, or may give rise to, the
Event of Default specified in clause 10.1(y);
(g) Copies true and complete
the copies of the Underlying Documents delivered or to be
delivered to the Administrative Agent pursuant to clause 9.1 are,
or will when delivered be, true and complete copies of such
documents; each of such documents will when delivered constitute
valid, binding and enforceable obligations of the members of the
Golar Gas Group who are parties thereto and there will have been
no amendments or variations thereof or defaults thereunder;
(h) Consents obtained
every consent, authorisation, licence or approval of, or
registration with or declaration to, governmental or public bodies
or authorities or courts required by any Security Party (and
considered by the Administrative Agent, in its absolute
discretion, to be material) to authorise, or required by any
Security Party in connection with, the execution, delivery,
validity, enforceability or admissibility in evidence of the
Underlying Documents and each of the Security Documents or the
performance by any Security Party of its obligations under the
Security Documents has been obtained or made and is in full force
and effect and there has been no default in the observance of any
condition or restriction (if any) imposed in, or in connection
with, any of the same and except as disclosed in writing by the
Borrower to the Administrative Agent prior to the date of this
Agreement;
(i) Pari passu
the obligations of the Borrower under this Agreement are direct,
general and unconditional obligations of the Borrower and rank at
least pari passu with all other present and future unsecured and
unsubordinated Indebtedness of the Borrower;
(j) No withholding Taxes
no Taxes are imposed by withholding or otherwise on any payment to
be made by any Security Party under the Underlying Documents or
the Security Documents or are imposed on or by virtue of the
execution or delivery by any Security Party of the Underlying
Documents or the Security Documents or any other document or
instrument to be executed or delivered under any of the Security
Documents;
Page 42
(k) No Default
no Default has occurred and is continuing;
(l) Ships
each Ship will on the Drawdown Date be:
(i) in the absolute ownership of the relevant Owning Company
free and clear of all Encumbrances other than current crew
wages and the relevant Mortgage who will on the Drawdown
Date be the sole, legal and beneficial owner of such Ship;
(ii) registered in the name of the relevant Owning Company
through the relevant Registry as a ship under the laws and
flag of the relevant Flag State;
(iii) operationally seaworthy and in every way fit for service;
(iv) classed with the relevant Classification free of all
overdue requirements and recommendations of the relevant
Classification Society;
(v) managed by an Approved Manager under an Approved Management
Agreement; and
(vi) continuing in the service of the relevant Approved
Charterer under its Approved Charter (if any);
(m) Xxxxx Xxxx
Xxxxx Xxxx will on the Drawdown Date be:
(i) in the absolute ownership of Faraway who will on the
Drawdown Date be the sole, legal and beneficial owner of
Xxxxx Xxxx;
(ii) registered in the name of Faraway as a ship under the laws
and flag of the Republic of Liberia;
(iii) operationally seaworthy and in every way fit for service;
(iv) classed with the classification +100A1, Liquefied Gas
Carrier free of all overdue requirements and
recommendations of Lloyd's Register of Shipping;
(v) managed by an Approved Manager under the Xxxxx Xxxx
Management Agreement; and
(vi) continuing in the service of Pertamina under the Pertamina
Charter;
(n) Compliance with Approved Charters
Each Owning Company has complied in all material respects with the
provisions of the relevant Approved Charter;
(o) Compliance with ISM Code
each Owning Company and Approved Manager has complied at all
material times in all material respects with the ISM Code;
(p) No litigation
no litigation, arbitration or administrative proceeding is taking
place, pending or, to the knowledge of the officers of any of the
Borrower, threatened against any Security Party or any other
member of the Golar LNG Group which could have a material adverse
effect on the business, assets or financial condition of any
Security Party;
(q) Ship's employment
other than pursuant to the Approved Charters, neither any Ship nor
Xxxxx Xxxx is nor will on or before the Drawdown Date be subject
to any charter or contract or to any agreement to enter into any
charter or contract which, if entered into after the date of this
Agreement would have required the consent of the Security Agent
under this Agreement and there is no agreement or arrangement
whereby the Earnings of any Ship after the date of this Agreement
may be shared with any other person;
Page 43
(r) Freedom from Encumbrances
none of the Ships nor Xxxxx Xxxx nor their respective its
Earnings, Insurances or Requisition Compensation nor any other
properties or rights which are, or are to be, the subject of any
of the Security Documents nor any part thereof will be on the
Drawdown Date subject to any Encumbrance other than for current
crew wages and the relevant Security Documents;
(s) Shareholdings in Parent
the Parent is a wholly owned Subsidiary of Osprey;
(t) No material adverse change
there has been no material adverse change in the consolidated
financial position of the Golar Gas Group from that set forth in
the pro forma financial statements referred to in clause 7.2(x);
and
(u) Faraway ownership
40% of the issued share capital of Faraway is legally and
beneficially owned by Oxbow and 20% is legally and beneficially
owned by Golar Maritime and the remaining 40% of such share
capital is legally and beneficially owned by Chinese Petroleum
Corporation;
(v) Liability to Taxation
save and except as disclosed in writing by the Borrower to the
Administrative Agent prior to the date of this Agreement, no
member of the Golar Gas Group is liable for or subject to any
Taxes imposed by any fiscal authority of or within any taxing
jurisdiction (including any international, national, municipal,
state, local or other taxing jurisdiction) by reason of a
connection between any member of the Golar Gas Group and such
taxing jurisdiction or carrying on business in such jurisdiction
or by reason of any member of the Golar Gas Group carrying on
business in such jurisdiction not being a connection arising
solely as a result of a vessel being located in that jurisdiction,
or loading or discharging at a port within that jurisdiction, in
the ordinary course of the business of a member of the Golar Gas
Group as owner and/or operator and/or charterer and/or manager of
such vessel;
(w) Faraway Borrowed Money
Faraway is not liable for, and has not incurred, any Borrowed
Money except pursuant to the Faraway Loan Agreement;
Page 44
(x) Financial statements
the pro forma annual financial statements in respect of the
financial year ended as of 31 May 2001 as delivered to the
Administrative Agent have been prepared in accordance with GAAP
which have been consistently applied and present fairly and
accurately the financial position of the Borrower and each Owning
Company and the consolidated financial position of the Golar Gas
Group (excluding Oxbow, Golar Maritime and Faraway) respectively
as at such date and the results of the operations of the Borrower
and each Owning Company and the consolidated results of the Golar
Gas Group (excluding Oxbow, Golar Maritime and Faraway)
respectively for the financial year ended on such date and, as at
such date, neither the Borrower nor any Owning Company nor the
Golar Gas Group (excluding Oxbow, Golar Maritime and Faraway) had
any liabilities (contingent or otherwise) or any unrealised or
anticipated losses which are not disclosed by, or reserved against
or provided for in, such financial statements and, in respect of
any contingent liabilities (whether or not material), with a
description of the basis for the liability and an explanation of
why the liability is not deemed to be material;
(y) Initial Approved Manager
following the Drawdown Date and the restructuring of the Golar LNG
Group, the existing employees of the Initial Manager will continue
to be employed on substantially the same basis; and
(z) Solvency
the Borrower and each Guarantor is Solvent and will continue to be
Solvent at and after the Drawdown Date.
7.3 Repetition of representations and warranties
On and as of the Drawdown Date and on each Rollover Date and any other
date for the payment of interest under clause 3.1, the Borrower shall be
deemed to repeat the representations and warranties in clause 7.1 as if
made with reference to the facts and circumstances existing on such day
and on and as of the Drawdown Date, the Borrower shall be deemed to
repeat the representations and warranties in clause 7.2.
7.4 Warranty as to future financial statements
On and as of each Rollover Date, the Borrower shall be deemed to
represent and warrant to each of the Creditors that the then latest
Annual Financial Statements then delivered to the Administrative Agent
(if any) have been prepared in accordance with GAAP and present fairly
and accurately the financial positions of the Borrower, the Parent, the
Owning Companies, Oxbow and Golar Maritime and the consolidated financial
positions of the Golar LNG Group (excluding Oxbow, Golar Maritime and
Faraway) respectively as at the end of the financial period to which the
same relate and the results of the operations of the Borrower, the
Parent, the Owning Companies, Oxbow and Golar Maritime and the
consolidated results of the operations of the Golar LNG Group (excluding
Oxbow, Golar Maritime and Faraway) respectively for the financial period
to which the same relate and, as at the end of such financial period,
neither the Borrower, the Parent, the Owning Companies, Oxbow and Golar
Maritime nor the Golar LNG Group nor the Golar Gas Group (excluding
Oxbow, Golar Maritime and Faraway) had any significant liabilities
(contingent or otherwise) or any unrealised or anticipated losses which
are not disclosed by, or reserved against or provided for in, such
financial statements.
Page 45
8 Undertakings
8.1 General
The Borrower undertakes with each of the Creditors that throughout the
Security Period it will:
(a) Notice of Default
promptly inform the Administrative Agent of any occurrence of
which it becomes aware which in the Borrower's reasonable opinion
might materially and adversely affect the ability of any Security
Party to perform their obligations under any of the Security
Documents and, without limiting the generality of the foregoing,
will inform the Administrative Agent of any Default forthwith upon
becoming aware thereof and will from time to time, if so requested
by the Administrative Agent, confirm to the Administrative Agent
in writing that, save as otherwise stated in such confirmation, no
Default has occurred and is continuing;
(b) Consents and licences
without prejudice to clauses 7 and 8.6, obtain or cause to be
obtained, maintain in full force and effect and comply in all
material respects with the conditions and restrictions (if any)
imposed in, or in connection with, every consent, authorisation,
licence or approval of governmental or public bodies or
authorities or courts and do, or cause to be done, all other acts
and things which may from time to time be necessary or desirable
under applicable law for the continued due performance of all the
obligations of the Security Parties under each of the Security
Documents;
(c) Use of proceeds
use the Loan exclusively for the purpose specified in clause 1.1;
(d) Pari passu
ensure that its obligations under this Agreement shall at all
times rank at least pari passu with all its other present and
future unsecured and unsubordinated Indebtedness with the
exception of any obligations which are mandatorily preferred by
law and not by contract;
(e) Financial statements, budgets, cashflows and certificates
(i) Accounts
prepare Annual Financial Statements in accordance with GAAP
consistently applied in respect of each financial year and
cause the same to be reported on by the Auditors and
prepare Quarterly Financial Statements on the same basis as
the Annual Financial Statements and deliver sufficient
copies of the same to the Administrative Agent for
distribution to the Banks as soon as practicable but not
later than 120 days (in the case of Annual Financial
Statements) or 60 days (in the case of Quarterly Financial
Statements) (or, in either such case, such longer period as
may be agreed in writing by the Administrative Agent) after
the end of the financial period to which they relate;
(ii) Budgets, cashflow projections etc.,
deliver to the Administrative Agent, for distribution to
the Banks sufficient copies of the following documents:
(A) not later than 30 days after the end of each
financial year, a budget and cash flow projection
for the Golar Gas Group for the next twelve months;
Page 46
(B) not later than 30 days after the end of each half
year period, a cash flow projection for the Golar
Gas Group for the next six months; and
(C) at least thirty (30) days prior to the date on which
it is proposed to make a payment of any Equity
Distribution under proviso (A) to clause 8.3(c), a
statement (certified by the Chairman or President of
the Borrower or, in his, her or their absence, any
other officer of the Borrower for the time being
acceptable to the Administrative Agent) of the
amount of the proposed Equity Distribution and the
Cumulative Net Income up to the end of the financial
quarter most recently ended, the aggregate amounts
of Equity Distributions previously made pursuant to
clause 8.3(c)(A), the amount of the Free Available
Cash at such date and the Cash Reserve as at the
relevant date accompanied by a certificate by the
Chairman or President of the Borrower or, in his,
her or their absence, any other officer of the
Borrower for the time being acceptable to the
Administrative Agent that the payment of such Equity
Distribution will comply with proviso (A) to clause
8.3(c);
(D) Certificate of compliance with clause 8.5
at the same time as the Borrower delivers to the
Administrative Agent, pursuant to clause 8.1(e)(i),
copies of the Annual Financial Statements or
Quarterly Financial Statements (as the case may be)
the Borrower shall provide a statement signed by the
Chief Financial Officer or another senior officer of
the Borrower (in substantially the form set out in
schedule 7 confirming:
1) the respective amounts of:
o the Cash Balances, the Cash Reserve and
Minimum Free Available Cash
o Current Assets, Current Liabilities and the
current portion of Long Term Debt
o Annualised EBITDA and Interest Expense
o Net Debt
in respect of or, as the case may be, as at the end
of the financial period expiring on the date as at
and for which the relevant financial statements were
prepared (or, in the case of Annualised EBITDA,
calculated by reference to the three month period
expiring on such date) (or, in the case of Interest
Expense, for the twelve month period expiring on
such date) and that such amounts were calculated in
accordance with this Agreement and GAAP;
Page 47
2) that such Annual Financial Statements or
Quarterly Financial Statements were prepared
in accordance with GAAP or, if not so
prepared, setting forth full details of the
adjustments required to be made to such
statements to reflect GAAP as necessary to
calculate the amounts referred to in
sub-paragraph (A) above;
3) that as at the date to which the relevant
financial statements are made up, the
Borrower was in compliance with the covenants
and undertakings set out in clause 8.5 (or,
if it was not in such compliance, indicating
the extent of the breach and the steps
intended to be taken to remedy the same); and
4) that, as at the date not more than seven days
prior to the delivery of the certificate, no
Default has occurred and is continuing (or,
if such is not the case, specifying the
same);
(iii) Faraway accounts
deliver to the Administrative Agent, for distribution to
the Banks, sufficient copies for all the Banks of, in each
case at the time of issue thereof any financial statements
or reports issued by Faraway to Oxbow and Golar Maritime;
(f) Delivery of reports
deliver to the Administrative Agent, for distribution to the Banks,
sufficient copies for all the Banks of, in each case at the time of
issue thereof every report, circular, notice or other document
issued by any member of the Golar LNG Group to its creditors or (in
the case of the Parent) shareholders generally;
(g) Provision of further information
provide the Administrative Agent with such financial and other
information concerning the Security Parties, other members of the
Golar LNG Group and their respective affairs as the Administrative
Agent or any Bank (acting through the Administrative Agent) may
from time to time reasonably require;
(h) Tax filings and payment of Taxes
file or cause to be filed all tax returns required to be filed in
all jurisdictions in which it and any other members of the Golar
LNG Group are situate or carry on business or are otherwise
subject to Taxation and pay all Taxes shown to be due and payable
on such returns or any assessments made against it (other than
those being contested in good faith where such payment may be
lawfully withheld) and adequate reserves have been made for such
payment should it be found to be payable;
(i) Legal proceedings
upon becoming aware that the same may be threatened or pending and
in any case immediately after the commencement thereof give to the
Administrative Agent notice in writing of any litigation or
arbitration or administrative proceedings or any dispute affecting
the Borrower or any other members of the Golar LNG Group any of
their respective assets, rights or revenues which if determined
against it might materially and adversely affect the ability of
the Borrower duly to perform and observe its obligations under any
of the Security Documents;
(j) Obligations under Security Documents
duly and punctually perform each of the obligations expressed to
be assumed by it under the Security Documents;
(k) Insurance
insure and keep insured all its properties and assets with
underwriters or insurance companies of repute to such extent and
against such risks as prudent companies engaged in businesses
similar to its own are normally insured;
(l) Pension schemes
within 60 days of the Drawdown Date (or such later date as the
Administrative Agent (acting on the instructions of the Majority
Banks) may agree), deliver to the Administrative Agent a valuation
of the pension schemes for the time being operated for the benefit
of employees of members of the Golar LNG Group and, if such
valuation shows a deficit of USD5,000,000 or more on a
discontinuance basis, take such steps as the Banks may reasonably
require to remedy or otherwise provide for such deficit; and
Page 48
(m) Compliance with laws and regulations
comply with the terms and conditions of all laws, regulations,
agreements, licences and concessions material to the carrying on
of their business.
8.2 Valuation of Ships
(a) Valuation of Ships and Xxxxx Xxxx
Each Mortgaged Ship and Xxxxx Xxxx shall be valued in Dollars as
at each Disposal Repayment Date by two independent firms of
shipbrokers one appointed by the Administrative Agent and the
other nominated by the Borrower from a list of firms from time to
time approved in writing by the Administrative Agent or, failing
such nomination (within seven (7) days of a request from the
Administrative Agent to nominate a firm) or approval, appointed by
the Administrative Agent in its sole discretion (each valuation to
be made on the basis of a sale for prompt delivery for cash at
arms length on normal commercial terms as between a willing buyer
and a willing seller taking into account the benefit of any
Approved Charter or any other charterparty or other engagement
concerning each vessel and, if the Administrative Agent requires
such valuation to be made after physical inspection, with such
physical inspection having been carried out).
Unless one of such valuations is for an amount which is 110% or
more of the other, the mean of such valuations shall constitute
the value of the relevant vessel for the purposes of this clause
8.2. If one such valuation is for such amount, the Administrative
Agent shall appoint (at the cost of the Borrower) a third
independent firm of shipbrokers to value such vessel on the same
basis and in the same manner and the mean of all three such
valuations shall constitute the value of the relevant vessel for
the purposes of this clause 8.2.
The value of each vessel as most recently determined in accordance
with the provisions of this clause 8.2 shall be binding upon the
parties hereto until such time as any further such valuations
shall be obtained.
(b) Information
The Borrower undertakes to the Administrative Agent to supply to
the Administrative Agent and to any such shipbrokers such
information concerning each Ship and its condition as such
shipbrokers may reasonably require for the purpose of making any
such valuations.
(c) Costs
All costs in connection with the Administrative Agent obtaining
any valuation of the Mortgaged Ships referred to in this clause
shall be borne by the Borrower.
8.3 Negative undertakings concerning the Borrower and the Golar Gas Group
The Borrower undertakes with each of the Creditors that throughout the
Security Period it will not, and will procure that none of the other
members of the Golar Gas Group (which shall, for this purpose only,
exclude Faraway unless and until it has become a wholly owned Subsidiary
of the Borrower) will, without the prior written consent of the
Administrative Agent (acting on the instructions of the Majority Banks):
(a) No merger
merge or consolidate with any other person;
(b) Capital expenditure
incur or make any capital expenditure, except for capital
expenditure in upgrading a Mortgaged Ship to meet the requirements
of a third party charterer or on upgrading or improving any
Mortgaged Ship for other operational purposes provided that such
expenditure on any Mortgaged Ship does not in any period of 30
consecutive months exceed USD5,000,000;
(c) Equity Distributions
make or pay any Equity Distribution provided however that:
(A) provided no Default has occurred and is continuing, the
Borrower may (subject to having first provided the
applicable statement and certificate required under clause
8.1(e)(ii)(C)) on any date (the "Relevant Date") pay or
make a dividend provided that after paying or making such
dividend the aggregate of all dividends paid or made
pursuant to this paragraph (A), effected on or before the
Relevant Date will not exceed an amount equal to one half
of its Cumulative Net Income at the Relevant Date and
provided:
1) no Default has occurred and is continuing; and
Page 49
2) the Free Available Cash at the Relevant Date will,
following the payment of the dividend above and any
related withdrawal from an Eligible Account under
clause 14.1(b)(iv), equal or exceed not less than an
amount equal to the sum of USD35,000,000 minus the
Cash Reserve as the Relevant Date;
(B) any Subsidiary of the Borrower may make Equity
Distributions to the Borrower or a wholly owned Subsidiary
of the Borrower;
(C) the Borrower may pay Equity Distributions to the Parent of
an amount equal to all dividends and other amounts received
by Oxbow and/or Golar Maritime from Faraway and credited to
an Earnings Account which remain after making any mandatory
prepayment required under clause 4.3 or 4.7 as a result of
receipt of such dividend or other amounts by Oxbow and/or
Golar Maritime;
(d) Amendments to, and termination of, Approved Management Agreements
agree to, or permit or suffer, any material amendment of, or
material variation in the terms of, or cancel or rescind or
otherwise terminate any Approved Management Agreement save for a
termination of the appointment of any Approved Manager provided
that upon such termination a new Approved Manager has been
appointed pursuant to an Approved Management Agreement on terms
approved in writing by the Administrative Agent (acting on the
instructions of the Majority Banks) (such approval and
instructions not to be unreasonably withheld);
(e) Series of disposals
sell, convey, transfer, lease or otherwise dispose of all or a
substantial part of the assets of the Borrower or of the Golar Gas
Group taken as a whole (whether by one transaction or a series of
transactions and whether related or not) (and, for the avoidance
of doubt, a Mortgaged Ship or the Golar Gas Group's interest in
share capital of Faraway shall not be deemed substantial for the
purpose of this clause 8.3(e));
(f) Other business
in the case of an Owning Company, undertake any business other
than the ownership and operation of its Ship and in the case of
the Borrower, undertake any business other than owning to the
Owning Companies, Oxbow and Golar Maritime and in the case of
Oxbow and Golar Maritime, undertake any business other than the
ownership of their respective shares in Faraway;
(g) Acquisitions
in the case of an Owning Company, acquire or own any further
assets other than its Ship and its rights arising under the
Underlying Documents and other contracts entered into by or on
behalf of the relevant Owning Company in the ordinary course of
its business of owning and operating such Ship and chartering such
Ship and, in the case of the Borrower, acquire or own any further
assets other than the shares in the Owning Companies and its
rights arising under the Underlying Documents and other contracts
entered into by or on behalf of the Borrower in the ordinary
course of its business and, in the case of Oxbow and Golar
Maritime, acquire or own any further assets other than their
respective shares in Faraway and their rights arising under the
Faraway Documents and other contracts entered into by or on behalf
of Oxbow or Golar Maritime in the ordinary course of their
business;
(h) Other obligations
in the case of an Owning Company, incur or permit to exist any
obligations except for obligations arising under the Approved
Management Agreement for its Ship, any relevant charter, or the
Security Documents or contracts entered into in the ordinary
course of its business of owning, operating and chartering such
Ship and, in the case of the Borrower, Oxbow and Golar Maritime
incur or permit to exist any obligations except for obligations
arising under the Security Documents and contracts entered into by
or on behalf of the Borrower, Oxbow or (as the case may be) Golar
Maritime in the ordinary course of their business and, in the case
of Oxbow and Golar Maritime only, under the Faraway Documents;
Page 50
(i) No borrowing or swaps
incur or permit to exist any Borrowed Money or Swap Liabilities of
any member of the Golar Gas Group except for:
(i) Borrowed Money pursuant to the Security Documents;
(ii) Borrowed Money owing by the Borrower or a wholly owned
Subsidiary of the Borrower to the Borrower or another
wholly owned Subsidiary of the Borrower (other than Oxbow
or Golar Maritime);
(iii) Eligible Swap Liabilities; and
(iv) Subordinated Debt;
(j) Repayment of borrowings from Restricted Associates
repay the principal of, or pay interest on or any other sum in
connection with any of its Borrowed Money owed to any Restricted
Associate;
(k) Repayment of borrowings
in the case of an Owning Company, repay the principal of, or pay
interest on or any other sum in connection with any of its
Borrowed Money except for Borrowed Money owing to the Creditors
pursuant to the Security Documents, to the extent permitted by
this Agreement, Subordinated Debt owing to the Parent and,
provided no Event of Default has occurred and is continuing,
Borrowed Money owing to other members of the Golar Gas Group
(other than Oxbow, Golar Maritime or Faraway);
(l) Sureties
except pursuant to the Security Documents, permit any of its
Indebtedness to any person to be guaranteed by any person (other
than the Borrower) and save (in the case of a member of the Golar
Gas Group which owns or bareboat charters a vessel) for guarantees
or indemnities from time to time required in the ordinary course
by any protection and indemnity or war risks association with
which its vessel is entered, guarantees required to procure the
release of such vessel from any arrest, detention, attachment or
levy or guarantees or undertakings required for the salvage of
such vessel and guarantees required to obtain certificates of
financial responsibility required for the lawful trading and
operation of its vessel;
(m) Subsidiaries
form or acquire or permit to exist any Subsidiaries other than the
Owning Companies, Golar Maritime, Oxbow, Faraway and any other
direct wholly owned Subsidiary of the Borrower incorporated for
the purpose of facilitating the management and operation of the
Ships and which does not own or charter vessels or other fixed
assets;
(n) Encumbrances
permit any Encumbrance to subsist, arise or be created or extended
over all or any part of its present or future undertaking, assets,
rights or revenues to secure or prefer any present or future
Indebtedness or other liability or any other obligation of any
person save for Permitted Encumbrances;
Page 51
(o) Guarantees and counter indemnities
issue, or permit to remain outstanding, any guarantees or
indemnities or otherwise become directly or contingently liable
for the obligations of, or in favour of, any person or issue, or
permit to remain outstanding, any indemnity or other obligation to
reimburse or secure to any other person in respect of any such
guarantee, indemnity or Encumbrance issued or granted by such
person in respect of obligations of any person except:
(i) pursuant to the Security Documents;
(ii) guarantees or indemnities from time to time required in the
ordinary course by any protection and indemnity or war
risks association with which a vessel which it owns is
entered;
(iii) guarantees required to procure the release of such vessel
from any arrest, detention, attachment or levy or
guarantees or undertakings required for the salvage of such
a vessel;
(iv) guarantees by the Borrower (but not guarantees in respect
of Borrowed Money or Swap Liabilities if such Borrowed
Money or Swap Liabilities are not permitted by the express
terms of clause 8.3(i)) of obligations of its wholly owned
Subsidiaries (except Oxbow, Golar Maritime and Faraway)
arising under agreements entered into by them in the
ordinary course of their businesses; or
(p) Loans
make or permit to be outstanding any loans or grant or permit to
be outstanding any credit to any person or agree to do so other
than:
(i) customary trade credit to third party customers in the
ordinary course of business; and
(ii) loans to the Borrower and/or wholly owned Subsidiaries of
the Borrower (except Oxbow, Golar Maritime and Faraway);
and
(iii) the deposit of funds with an Account Bank by crediting the
same to an Earnings Account;
(q) Disposals
sell, transfer, lend or otherwise dispose of any part of its
present or future undertaking, assets, rights or revenues to any
person (other than the Borrower or a wholly owned Subsidiary of
the Borrower) unless the Borrower has previously notified the
Administrative Agent in writing and demonstrates to the
satisfaction of the Majority Banks that such sale, transfer, loan
or other disposal will be on arms length terms and for not less
than open market value;
Page 52
(r) Accounting reference date
change its annual accounting reference date from 31st December;
(s) Chartering-in
charter-in or hire any vessel from any person; or
(t) Sale and leaseback transactions
directly or indirectly, enter into, assume, guarantee or otherwise
become liable with respect to any sale and leaseback transaction
(being for these purposes an arrangement relating to property now
owned or hereafter acquired whereby the Borrower or a Subsidiary
of the Borrower transfers such property to a person and leases it
back from such person and accounted for as a Capitalised Lease
Obligation) save as contemplated by any Tax Lease Option permitted
under clause 17.
8.4 Ship covenants
The Borrower hereby covenants with each of the Creditors and undertakes
throughout the Security Period that each Owning Company will:
(a) Insurance
(i) Insured risks, amounts and terms
insure and keep its Mortgaged Ship insured free of cost and
expense to the Security Agent and in the name of the
relevant Owning Company (but in the case of the insurances
referred to in sub-paragraph (A) below, no other person,
save with the prior written consent of the Security Agent
and subject to such person having, if so required by the
Security Agent and to the satisfaction of the Security
Agent, executed a first priority assignment in favour of
the Security Agent of such person's interest in the
Insurances of such Ship on similar terms to the assignment
by the relevant Owning Company in the relevant General
Assignment) or, if so required by the Security Agent, in
the joint names of the relevant Owning Company and the
Security Agent, the Administrative Agent and/or the Banks
(but without liability on the part of the Security Agent,
the Administrative Agent and/or the Banks for premiums or
calls):
(A) against fire and usual marine risks (including
excess risks) and war risks, on an agreed value
basis, in such amounts (but not in any event less
than the higher of (1) 120% of the Relevant Insured
Amount for such Mortgaged Ship and (2) its market
value as most recently determined in accordance with
clause 8.2 prior to the commencement of the period
of the relevant policy) and upon such terms as shall
from time to time be approved in writing by the
Security Agent;
(B) against protection and indemnity risks (including
pollution risks for a minimum amount of
USD1,000,000,000 or such higher or lower maximum
amount of cover against pollution risks as shall at
any time be available by entry of the relevant Ship
with, and/or arrangement by, and/or under any cover
arranged by, or through either a protection and
indemnity association which is a member of either
the "International Group" of protection and
indemnity associations (or any successor
organisation designated by the Security Agent for
this purpose) or the International Group (or such
successor organisation) itself or, if the
International Group or any such successor ceases to
exist or ceases to provide or arrange any cover for
pollution risks, or any supplemental cover for
pollution risks over and above that afforded by the
basic entry of the Ship with its protection and
Page 53
indemnity association, the maximum aggregate amount
of cover against pollution risks as shall be
available on the open market and by basic entry with
a protection and indemnity association provided
that, if the Ship in question has ceased trading or
is in lay up (and its cargo fully discharged) and in
either case has discharged all cargo, the level of
pollution risks cover afforded by ordinary
protection and indemnity cover available through a
member of the International Group or such successor
organisation or, as the case may be, on the open
market in such circumstances shall be sufficient for
such purpose) for ships of the same type, size, age
and flag as the relevant Ship) for the full value
and tonnage of such Ship (as approved in writing by
the Security Agent) and upon such terms as shall
from time to time be approved in writing by the
Security Agent; and
(C) in respect of any Mortgaged Ship which is not at the
relevant time chartered by demise, against loss of
hire in such amounts (but in any event not less than
the rate of charterhire payable under the relevant
charter for such Ship) and upon such terms (but in
any event for periods of not less than 240 days per
claim less a 14 day deductible) as shall from time
to time be approved in writing by the Security
Agent;
and pay the Security Agent the cost (as conclusively
certified by the Security Agent) of:
1) mortgagees' interest insurance and/or additional
perils (pollution) cover which the the Security
Agent may from time to time effect in respect of any
Mortgaged Ship or all of the Mortgaged Ships upon
such terms and in such amount (not exceeding an
amount equal to 120 per cent. of the Relevant
Insured Amount for such Mortgaged Ship or (as the
case may be where all of the Mortgaged Ships are so
insured under one policy) 120 per cent. of the Loan
prior to the commencement of the period of the
relevant policy) as the Security Agent acting on the
instructions of the Majority Banks shall deem
desirable;
2) any other insurance cover which the Security Agent
may from time to time effect in respect of any
Mortgaged Ship and/or in respect of the interest of
any or all of the Creditors in relation to such
Mortgaged Ship or potential third party liability of
any or all of the Creditors in relation to such
Mortgaged Ship as the Security Agent shall
reasonably deem desirable having regard to (x) any
limitations in respect of amount or extent of cover
which may from time to time be applicable to any of
the other insurances referred to in this clause
8.4(a) and are not customarily applicable on the
date of this Agreement and/or (y) any change in the
practice of leading banks providing loans to finance
ships which carry Pollutants as to the insurances
which they require to be taken out to protect their
security interests in such ships and/or their
liability to third parties as a consequence of
financing such ships and/or taking a security
interest in such ships and/or (z) changes of
applicable laws (or the judicial or official
interpretation thereof) concerning the priority of
Environmental Claims as against ship mortgages
and/or the liability of mortgagees and lenders in
relation to Environmental Claims;
Page 54
(ii) Approved brokers, insurers and associations
effect the insurances aforesaid in Dollars or such
other currency as the Security Agent may approve and
through the Approved Brokers (if any) and with such
insurance companies and/or underwriters as shall
from time to time be approved in writing by the
Security Agent; provided however that the insurances
against war risks and protection and indemnity risks
may be effected by the entry of any Mortgaged Ship
with such war risks and protection and indemnity
associations as shall from time to time be approved
in writing by the Security Agent;
(iii) Fleet liens, set-off and cancellation
if any of the insurances referred to in 8.4(a)(i)
form part of a fleet cover, procure that the
Approved Brokers shall (if so required by the
Security Agent) undertake to the Security Agent that
they shall neither set off against any claims in
respect of any Mortgaged Ship any premiums due in
respect of other vessels under such fleet cover or
any premiums due for other insurances, nor cancel
the insurance for reason of non-payment of premiums
for other vessels under such fleet cover or of
premiums for such other insurances, and shall
undertake to issue a separate policy in respect of
each Mortgaged Ship if and when so requested by the
Security Agent;
(iv) Payment of premiums and calls
punctually pay all premiums, calls, contributions or
other sums payable in respect of all such insurances
and produce all relevant receipts or other evidence
of payment when so required by the Security Agent;
(v) Renewal
at least 14 days (or such shorter period as the
Security Agent may from time to time agree) before
the relevant policies, contracts or entries expire,
notify the Security Agent of the names of the
brokers and/or the war risks and protection and
indemnity associations proposed to be employed by
the relevant Owning Company or any other party for
the purposes of the renewal of such insurances and
of the amounts in which such insurances are proposed
to be renewed and the risks to be covered and,
subject to compliance with any requirements of the
Security Agent pursuant to this clause 8.4(a),
procure that appropriate instructions for the
renewal of such insurances on the terms so specified
are given to the Approved Brokers and/or to the
approved war risks and protection and indemnity
associations at least 10 days (or such shorter
period as the Security Agent may from time to time
agree) before the relevant policies, contracts or
entries expire, and that the Approved Brokers and/or
the approved war risks and protection and indemnity
associations will at least 7 days before such expiry
(or within such shorter period as the Security Agent
may from time to time agree) confirm in writing to
the Security Agent as and when such renewals have
been effected in accordance with the instructions so
given;
Page 55
(vi) Guarantees
arrange for the execution and delivery of such
guarantees or indemnities as may from time to time
be required by any protection and indemnity or war
risks association;
(vii) Hull policy documents, notices, loss payable clauses
and brokers' undertakings
deposit with the Approved Brokers (or procure the
deposit of) all slips, cover notes, policies,
certificates of entry or other instruments of
insurance from time to time issued in connection
with such of the insurances referred to in clause
8.4(a)(i) as are effected through the Approved
Brokers and procure that the interest of the
Security Agent, the Administrative Agent and the
Banks shall be endorsed thereon by incorporation of
the relevant Loss Payable Clause and by means of a
Notice of Assignment of Insurances (signed by the
relevant Owning Company and by any other assured who
shall have assigned its interest in the Insurances
to the Security Agent) and that the Security Agent
shall be furnished with pro forma copies thereof
and, unless the insurances are placed, to the
satisfaction of the Security Agent, upon the terms
of the Norwegian Marine Insurance Plan of 1996 as
amended, a letter or letters of undertaking from the
Approved Brokers in such form as shall from time to
time be required by the Security Agent;
(viii) Associations' loss payable clauses, undertakings and
certificates
procure that any protection and indemnity and/or war
risks associations in which any Mortgaged Ship is
for the time being entered shall endorse the
relevant Loss Payable Clause on the relevant
certificate of entry or policy and shall furnish the
Security Agent with a copy of such certificate of
entry or policy and, unless the insurances are
placed, to the satisfaction of the Security Agent,
upon the terms of the Norwegian Marine Insurance
Plan of 1996 as amended, a letter or letters of
undertaking in such form as shall from time to time
be required by the Security Agent;
(ix) Extent of cover and exclusions
take all necessary action and comply with all
requirements which may from time to time be
applicable to the Insurances (including, without
limitation, the making of all requisite declarations
within any prescribed time limits and the payment of
any additional premiums or calls) so as to ensure
that the Insurances are not made subject to any
exclusions or qualifications to which the Security
Agent has not given its prior written consent and
are otherwise maintained on terms and conditions
from time to time approved in writing by the
Security Agent;
Page 56
(x) Independent report
if so requested by the Security Agent where there
has, in the reasonable opinion of the Security
Agent, been a significant change in circumstances or
the insurance arrangements or the status of any
insurer or association which may, in the reasonable
opinion of the Security Agent, affect the interests
of the Banks, but at the cost of the Borrower,
furnish the Security Agent from time to time with a
detailed report signed by an independent firm of
marine insurance brokers appointed by the Security
Agent dealing with the insurances maintained on any
Mortgaged Ship and stating the opinion of such firm
as to the adequacy thereof;
(xi) Collection of claims
do all things necessary and provide all documents,
evidence and information to enable the Security
Agent to collect or recover any moneys which shall
at any time become due in respect of the Insurances;
(xii) Employment of Ships
not employ any Mortgaged Ship or suffer such Ship to
be employed otherwise than in conformity with the
terms of the Insurances (including any warranties
express or implied therein) without first obtaining
the consent of the insurers to such employment and
complying with such requirements as to extra premium
or otherwise as the insurers may prescribe;
(xiii) Application of recoveries
apply all sums receivable under the Insurances which
are paid to the relevant Owning Company in
accordance with the Loss Payable Clauses in
repairing all damage and/or in discharging the
liability in respect of which such sums shall have
been received;
(xiv) Further insurance assignments
unless the relevant Mortgaged Ship is insured
against the risks referred to in clause 8.4(a)(i)(A)
upon the terms of the Norwegian Insurance Plan of
1996 as amended, not permit the insurances referred
to in such clause to be effected in the name of any
person (other than the Security Agent and/or the
other Creditors) unless such person has to the
satisfaction of the Security Agent executed a first
priority assignment of the Security Agent of such
person's interest in the Insurances of such Ship on
similar terms (mutatis mutandis) to the assignment
by the relevant Owning Company in the relevant
General Assignment;
(b) Ship's name and registration
(i) not change the name of any Mortgaged Ship without
first notifying the Administrative Agent;
(ii) keep each Mortgaged Ship registered under the laws
of its Flag State at the relevant Port of Registry;
Page 57
(iii) not do or suffer to be done anything, or omit to do
anything the doing or omission of which could or
might result in such registration being forfeited or
imperilled or which could or might result in a
Mortgaged Ship being required to be registered
otherwise than under the laws of its Flag State at
the relevant Port of Registry;
(iv) not register any Mortgaged Ship or permit its
registration under any other flag or at any other
port without the prior written consent of the
Administrative Agent;
(v) if the said registration of a Mortgage Ship is for a
limited period, renew the registration of such Ship
at least 45 days prior to the expiry of such
registration and provide evidence of such renewal to
the Administrative Agent at least 30 days prior to
such expiry;
(c) Repair
keep each Mortgaged Ship and its equipment, outfit and
appurtenances tight, staunch, strong, in good condition and
in all respects seaworthy and fit for its intended service
and in a good and efficient state of repair and procure
that all repairs to or replacement of any damaged, worn or
lost parts or equipment are effected in such manner (both
as regards workmanship and quality of materials) as not to
diminish the value of such Ship;
(d) Modification; removal of parts; equipment owned by third
parties
not without the prior written consent of the Security Agent
or suffer any other person to:
(i) make any modification to any Mortgaged Ship in
consequence of which her structure, type or
performance characteristics could or might be
materially altered or her value materially reduced;
or
(ii) remove any material part of any Mortgaged Ship or
any equipment the value of which is such that its
removal from such Ship would materially reduce the
value of such Ship without replacing the same with
equivalent parts or equipment which are owned by the
relevant Owning Company free from Encumbrances; or
(iii) install on any Mortgaged Ship any equipment owned by
a third party which cannot be removed without
causing damage to the structure or fabric of such
Ship;
Page 58
(e) Maintenance of class; compliance with regulations
at all times and without cost or expense to any Creditor
keep its Mortgaged Ship, or cause her to be kept, in such
condition as will entitle her to the highest classification
and rating for vessels of the same age and type in the
Classification Society or other classification society of
like standing approved by the Administrative Agent and to
deliver annually to the Administrative Agent a certificate
from such class society showing such classification to be
maintained and will without cost or expense to the
Administrative Agent irrevocably and unconditionally
instruct and authorise the classification society of its
Mortgaged Ship, and shall request the classification
society to give an undertaking to the Security Agent as
follows:
(i) to send to the Administrative Agent, following
receipt of a written request from the Administrative
Agent, certified true copies of all original class
records held by the classification society relating
to the Mortgaged Ship;
(ii) to allow the Administrative Agent (or its agents),
at any time and from time to time, to inspect the
original class and related records of the relevant
Owning Company and its Mortgaged Ship at the offices
of the classification society and to take copies of
them;
(iii) following receipt of a written request from the
Administrative Agent:
(A) to advise of any facts or matters which may
result in or have resulted in a change,
suspension, discontinuance, withdrawal or
expiry of any Mortgaged Ship's class under
the rules or terms and conditions of the
relevant Owning Company's or the relevant
Mortgaged Ship's membership of the
classification society; and
(B) to confirm that the relevant Owning Company
is not in default of any of its contractual
obligations or liabilities to the
classification society and, without limiting
the foregoing, that it has paid in full all
fees or other charges due and payable to the
classification society; and
Page 59
(C) if the relevant Owning Company is in default
of any of its contractual obligations or
liabilities to the classification society, to
specify to the Administrative Agent in
reasonable detail the facts and circumstances
of such default, the consequences thereof,
and any remedy period agreed or allowed by
the classification society; and
(D) to notify the Administrative Agent
immediately in writing if the classification
society receives notification from any Owning
Company or any other person that a Mortgaged
Ship's classification society is to be
changed.
Notwithstanding the above instructions and undertaking
given for the benefit of the Administrative Agent, each
Owning Company shall continue to be responsible to the
classification society for the performance and discharge of
all its obligations and liabilities relating to or arising
out of or in connection with the contract it has with the
classification society, and nothing herein or therein shall
be construed as imposing any obligation or liability of the
Administrative Agent to the classification society;
(f) Surveys
submit each Mortgaged Ship to continuous surveys and such
periodical or other surveys as may be required for
classification purposes and, if so requested by the
Administrative Agent or if the survey report relates to or
recommends or requires repairs and/or other work the cost
of which will or may exceed the Casualty Amount, supply to
the Administrative Agent copies of all survey reports
issued in respect thereof;
(g) Inspection
ensure that the Administrative Agent, by surveyors or other
persons appointed by it for such purpose, may board any
Mortgaged Ship at all reasonable times without interfering
with the operation of such Ship for the purpose of
inspecting her and to afford all proper facilities for such
inspections and for this purpose to give to the
Administrative Agent reasonable advance notice of any
intended drydocking of any Mortgaged Ship (whether for the
purpose of classification, survey or otherwise)(provided
that any such surveyor or other person shall undertake
confidentiality with respect to disclosure of the results
of such inspection to any third parties other than the
Creditors and their advisers);
(h) Prevention of and release from arrest
promptly in accordance with good ship owning practice pay
and discharge all debts, damages, liabilities and outgoings
whatsoever which have given or may give rise to maritime,
statutory or possessory liens on, or claims enforceable
against, each Mortgaged Ship, her Earnings or Insurances or
any part thereof and, in the event of a writ or libel being
filed against any Mortgaged Ship, her Earnings or
Insurances or any part thereof, or of any of the same being
arrested, attached or levied upon pursuant to legal process
or purported legal process or in the event of detention of
any Mortgaged Ship in exercise or purported exercise of any
such lien or claim as aforesaid, procure the release of
such Ship, her Earnings and Insurances from such arrest,
detention attachment or levy or, as the case may be, the
discharge of the writ or libel forthwith upon, or in any
event within ten (10) Banking Days after, receiving notice
thereof by providing bail or procuring the provision of
security or otherwise as the circumstances may require;
Page 60
(i) Employment
not employ any Mortgaged Ship or permit her employment in
any manner, trade or business which is forbidden by
international law, or which is unlawful or illicit under
the law of any relevant jurisdiction, or in carrying
illicit or prohibited goods, or in any manner whatsoever
which may render her liable to condemnation in a prize
court, or to destruction, seizure, confiscation, penalty or
sanctions and, in the event of hostilities in any part of
the world (whether war be declared or not), not employ any
Mortgaged Ship or permit her employment in carrying any
contraband goods, or enter or trade to or to continue to
trade in any zone which has been declared a war zone by any
Government Entity or by the relevant Ship's war risks
insurers unless the prior written consent of the
Administrative Agent is obtained and such special insurance
cover as the Administrative Agent may require shall have
been effected by the relevant Owning Company at its
expense;
(j) Information
promptly furnish the Administrative Agent with all such
information as it may from time to time reasonably require
regarding each Mortgaged Ship, her Insurances, her
employment, position and engagements, particulars of all
towages and salvages, and copies of all charters and other
contracts for her employment entered into by the relevant
Owning Company, or otherwise howsoever concerning her;
(k) Notification of certain events
notify the Administrative Agent forthwith by telefax or
other means of telecommunication in permanent written form
thereafter confirmed by letter of:
(i) any damage to any Mortgaged Ship requiring repairs
the cost of which will or might exceed its Casualty
Amount;
(ii) any occurrence in consequence of which any Mortgaged
Ship has or may become a Total Loss;
(iii) any requisition of any Mortgaged Ship for hire;
(iv) any requirement or recommendation made in relation
to any Mortgaged Ship by any insurer or its
Classification Society or by any competent authority
which is not complied with in accordance with its
terms;
Page 61
(v) any arrest or detention of any Mortgaged Ship or any
exercise or purported exercise of a lien or other
claim on such Ship or her Earnings or Insurances or
any part thereof;
(vi) the occurrence of any material Environmental Claim
against the relevant Owning Company, any Mortgaged
Ship or any other member of the Golar LNG Group or
any other ship from time to time owned, technically
managed or crewed by, or bareboat chartered to, any
member of the Golar LNG Group or any incident, event
or circumstances which may give rise to any such
Environmental Claim or an Event of Default specified
in clause 10.1(y);
(l) Payment of outgoings and evidence of payments
promptly pay all tolls, dues and other outgoings whatsoever
in respect of each Mortgaged Ship and her Earnings and
Insurances and keep proper books of account in respect of
each Mortgaged Ship and her Earnings and, as and when the
Administrative Agent may so require, make such books
available for inspection on behalf of the Administrative
Agent, and furnish satisfactory evidence that the wages and
allotments and the insurance and pension contributions of
the Master and crew are being promptly and regularly paid
and that all deductions from crew's wages in respect of any
applicable tax liability are being properly accounted for
and that the Master has no claim for disbursements other
than those incurred by him in the ordinary course of
trading on the voyage then in progress;
(m) Encumbrances
not without the prior written consent of the Administrative
Agent acting on the instructions of all of the Banks (and
then only subject to such conditions as the Administrative
Agent may impose in accordance with such instructions)
create or purport or agree to create or permit to arise or
subsist any Encumbrance (other than Permitted Encumbrances)
over or in respect of any Mortgaged Ship, any share or
interest therein or in any other part of the Mortgaged
Property (as defined in the General Assignment in respect
of such Ship);
(n) Sale or other disposal
not without the prior written consent of the Administrative
Agent acting on the instructions of the Majority Banks (and
then only subject to such conditions as the Administrative
Agent may impose in accordance with such instructions)
sell, agree to sell, transfer, abandon or otherwise dispose
of any Mortgaged Ship or any share or interest therein if
the Net Sale Proceeds of such Ship will or may be
insufficient to enable the Borrower to comply with its
obligations under clause 4.3 of this Agreement arising upon
the sale of such Ship (including (without limitation)
prepayment in full of the Loan if required by clause 4.3)
and the Borrower has not first demonstrated to the
reasonable satisfaction of the Administrative Agent that
the Borrower will have other funds available to it provided
by way of Equity Finance to enable it to comply with such
obligations upon completion of the sale of such Ship;
Page 62
(o) Chartering
except pursuant to an Approved Charter referred to in Part
2 of schedule 2 not without the prior written consent of
the Administrative Agent acting on the instructions of the
Lead Arrangers (which the Administrative Agent shall have
full liberty to withhold in accordance with such
instructions) and, if such consent is given, only subject
to such conditions as the Administrative Agent may impose:
(i) let any Mortgaged Ship on demise charter for any
period;
(ii) let any Mortgaged Ship by any time or consecutive
voyage charter for a term which exceeds or which by
virtue of any optional extensions therein contained
may exceed twelve months' duration;
(iii) de-activate or lay up the relevant Ship;
(iv) let any Mortgaged Ship other than on arms' length
terms;
provided always that:
(A) such consent shall not be withheld if the proposed
charterer or charter guarantor has a long term
credit rating of at least BBB+ from Standard &
Poor's Ratings Services and Baa1 from Moodys
Investors Services Inc. or any other rating agency
approved in writing by the Administrative Agent for
such purpose; and
(B) in respect of the matters referred to in
sub-paragraph (ii) of this sub-clause the
Administrative Agent's consent shall be deemed to
have been given thereto if the Borrower shall not
have been informed by the Administrative Agent
either in writing or by word of mouth that such
consent is refused within five (5) Banking Days (in
London) of the time at which the relevant Owning
Company's application for such consent was received
by the Administrative Agent;
(p) Sharing of Earnings
not without the prior written consent of the Administrative
Agent acting on the instructions of the Majority Banks (and
then only subject to such conditions as the Administrative
Agent may impose in accordance with such instructions) to
enter into any agreement or arrangement whereby the
Earnings of any Mortgaged Ship may be shared with any other
person;
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(q) Payment of Earnings
to procure that the Earnings of any Mortgaged Ship are paid
to the Security Agent at all times if and when the same
shall be or shall have become so payable in accordance with
the Security Documents and that any Earnings of any
Mortgaged Ship which are so payable and which are in the
hands of a relevant Owning Company's brokers or agents are
duly accounted for and paid over to the Security Agent
forthwith on demand;
(r) Repairers' liens
not without the prior written consent of the Administrative
Agent put any Mortgaged Ship into the possession of any
person for the purpose of work being done upon her unless
either:
(i) such person shall first have given to the
Administrative Agent in terms satisfactory to it, a
written undertaking not to exercise any lien on the
relevant Ship or her Earnings for the cost of such
work or otherwise; or
(ii) any such lien of such person would be a Permitted
Lien;
(s) Manager
not appoint a manager of any Mortgaged Ship other than an
Approved Manager;
(t) Notice of Mortgage
place and at all times and places retain a properly
certified copy of each Mortgage (which shall form part of
the relevant Ship's documents) on board each Mortgaged Ship
with her papers and cause such certified copy of such
Mortgage to be exhibited to any and all persons having
business with such Ship which might create or imply any
commitment or encumbrance whatsoever on or in respect of
such Ship (other than a lien for crew's wages and salvage)
and to any representative of the Security Agent and place
and keep prominently displayed in the navigation room and
in the Master's cabin of each Mortgaged Ship a framed
printed notice in plain type reading as follows:
Page 64
"NOTICE OF MORTGAGE"
This Ship is subject to a first priority mortgage in favour
of [here insert name of Security Agent] of [here insert
address of Security Agent]. Under the said mortgage,
neither the Borrower nor any charterer nor the Master of
this Ship has any right, power or authority to create,
incur or permit to be imposed upon this Ship any
commitments or encumbrances whatsoever other than for
crew's wages and salvage"
and in terms of the said notice it is hereby agreed that
save and subject as otherwise herein provided, neither the
relevant Owning Company nor any charterer nor the Master of
any Mortgaged Ship nor any other person has any right,
power or authority to create, incur or permit to be imposed
upon any Mortgaged Ship any lien whatsoever other than for
crew's wages and salvage;
(u) Conveyance on default
where a Mortgaged Ship is (or is to be) sold in exercise of
any power contained in the relevant Mortgage or otherwise
conferred on the Security Agent, execute, forthwith upon
request by the Security Agent, such form of conveyance of
such Ship as the Security Agent may require;
(v) Anti-drug abuse
without prejudice to clause 8.4(i), take all necessary and
proper precautions to prevent any infringements of the
Anti-Drug Abuse Act of 1986 of the United States of America
or any similar legislation applicable to any Mortgaged Ship
in any jurisdiction in or to which any Mortgaged Ship shall
be employed or located or trade or which may otherwise be
applicable to any Mortgaged Ship and/or the relevant Owning
Company;
(w) Compliance with Environmental Laws
to comply in all material respects with all Environmental
Laws applicable to it and/or its Mortgaged Ship including,
without limitation, requirements relating to xxxxxxx and
establishment of financial responsibility and to obtain and
comply with all Environmental Approvals applicable to its
and/or its Mortgaged Ship; and
(x) Compliance with ISM Code
comply at all material times in all material respects with
the ISM Code.
Page 65
8.5 Financial undertakings
The Borrower undertakes with each of the Creditors throughout the
Security Period that it will ensure that:
(a) Free Available Cash
at all times the Free Available Cash shall not be less than the
Minimum Free Available Cash at the relevant time;
(b) Working Capital
as at the end of each quarterly period during and at the end of
each financial year of the Borrower, the ratio of Current Assets
to Current Liabilities (excluding the current portion of long-term
debt) shall not be less than one point five (1.5) to (1); and
(c) Leverage
as at 30 June 2002 and as at the end of each subsequent quarterly
period during and at the end of each financial year the Borrower,
the ratio of Net Debt as at the end of such period to Annualised
EBITDA calculated by reference to such quarter shall not exceed:
(i) six point five (6.5) to one (1) for quarterly periods
ending during or at the end of 2002 and 2003;
(ii) six (6) to one (1) for quarterly periods ending during and
at the end of 2004; and (iii) five (5) to one (1) for all
subsequent quarterly periods.
8.6 Undertakings concerning Faraway and Xxxxx Xxxx
The Borrower hereby undertakes with each of the Creditors that it will
throughout the Security Period until such time as either Xxxxx Xxxx has
been sold or become a Total Loss or Oxbow and Golar Maritime have sold
their shares in Faraway as contemplated in clause 5.3 and in any such
case, the relevant Disposal Repayment Date has occurred and the Borrower
has complied with its obligations under clause 5.3 arising upon such sale
or Total Loss of Xxxxx Xxxx or sale of shares in Faraway:
(a) Faraway activities
use its best efforts to cause Faraway to ensure the following,
which best efforts shall include, without limitation, giving
instructions to directors of Faraway elected or appointed by Oxbow
or Golar Maritime and otherwise voting its Faraway shares in order
to ensure that:
(i) Debt
Faraway does not create, incur, assume or suffer to exist
or directly or indirectly guarantee or in any other manner
become directly or indirectly liable for the payment of any
Borrowed Money secured by an Encumbrance over Xxxxx Xxxx
other than Borrowed Money under the Faraway Loan Agreement
and any refinancing as contemplated by clause 8.6(d);
Page 66
(ii) Encumbrances
Faraway does not create, incur, assume or suffer to exist
any Encumbrance of any kind upon the Xxxxx Xxxx, her
Earnings, Insurances or Requisition Compensation or the
Pertamina Charter (other than Permitted Encumbrances);
(iii) Insurance
Xxxxx Xxxx is appropriately insured, in accordance with
good industry practice:
(A) against fire and usual marine risks (including
excess risks) and war risks, on an agreed value
basis, for an amount not less than its market value
as determined in accordance with clause 8.2 as at
the first day of the period of the relevant policy;
and
(B) against protection and indemnity risks (including
pollution risks for a minimum amount of
USD1,000,000,000 or such higher or lower maximum
amount of cover against pollution risks as shall at
any time be available by entry of Xxxxx Xxxx with,
and/or arrangement by, and/or under any cover
arranged by, or through, either a protection and
indemnity association which is a member of either
the "International Group" of protection and
indemnity associations or any successor organisation
designated by the Administrative Agent for this
purpose or the International Group or such successor
organisation itself or, if the International Group
or any such successor ceases to exist or ceases to
provide cover for pollution risks, the maximum
amount of cover against pollution risks as shall be
available on the open market provided that, if Xxxxx
Xxxx has ceased trading or is in lay up and in
either case has discharged all cargo, the level of
pollution risks cover afforded by the ordinary
protection and indemnity cover available through a
member of the International Group or such successor
organisation or, as the case may be, on the open
market in such circumstances shall be sufficient for
such purpose) for its full value and tonnage
and that Faraway will punctually pay all premiums, calls,
contributions or other sums payable in respect of such
insurance and comply in all respects with all requirements
which may from time to time be applicable to such
insurances;
(iv) Repair/operational
the terms of clauses 8.4(a)(xii), (c), (d), (e), (f), (h),
(i), (j), (k) and (l) complied with in relation to Xxxxx
Xxxx as if references to a Mortgaged Ship were references
to Xxxxx Xxxx;
(v) Sale of Xxxxx Xxxx
Faraway does not sell, agree to sell, transfer, abandon or
otherwise dispose of Xxxxx Xxxx unless the Borrower
complies with its obligations under clause 5.3 arising upon
a sale of Xxxxx Xxxx;
Page 67
(vi) No merger
Faraway does not merge or consolidate with any other person
save with the prior written consent of the Banks (not to be
unreasonably withheld if such merger or consolidation will
have no material adverse affect on the overall value of the
security constituted by the Security Documents at such
time);
(vii) Control of operations
ensure that one or more of the Parent's wholly owned
Subsidiaries at all times control, by virtue of a
management agreement or otherwise, the day to day operation
of Xxxxx Xxxx including (without limitation) maintenance,
drydocking, crewing and insurance;
(viii) Faraway Documents
not, without the prior written consent of the
Administrative Agent (such consent not to be unreasonably
withheld):
(A) Variations
agree, or permit Faraway to agree, any material
variation of any of the Faraway Documents;
(B) Releases and waivers
release any other party, or permit Faraway to
release any other party, from any of its material
obligations under any of the Faraway Documents or
waive any breach of its material obligations
thereunder or consent to any such act or omission of
such party as would otherwise constitute such
breach; or
(C) Termination
determine or permit Faraway to determine any of the
Faraway Documents;
(b) Sale of Faraway
ensure that Oxbow and Golar Maritime shall not, without the prior
written consent of the Banks, sell or otherwise dispose of any of
their shares or stock in Faraway unless the Borrower complies with
its obligations under clause 4.3 arising upon a sale of Oxbow and
Golar Maritime's shares in Faraway or any of their rights, title
and interest in or under any of the Faraway Documents;
(c) Payments by Faraway
ensure that all dividends and other amounts payable by Faraway to
Oxbow and Golar Maritime are paid to an Earnings Account unless
and until the Security Administrative Agent otherwise directs
pursuant to the Faraway Pledge;
(d) Refinancing of Xxxxx Xxxx
not refinance the existing Indebtedness under the Faraway Loan
Agreement in respect of Xxxxx Xxxx without the prior written
consent of the Banks (not to be unreasonably withheld) provided
always that it shall be reasonable for the Bank to refuse their
consent if such refinancing will have a material adverse affect on
the overall value of the security constituted by the Security
Documents at such time; and
Page 68
(e) Additional security
upon the request of the Administrative Agent (acting on the
instructions of the Majority Banks) procure that Oxbow and Golar
Maritime grant in favour of the Security Agent such additional
second priority security over their shares in Faraway and use its
best endeavours to obtain any necessary consent to such security
under the Faraway Loan Agreement.
8.7 Undertakings concerning Approved Charters and Charter Guarantees
The Borrower hereby undertakes with each of the Creditors that it will,
and will procure that the Owning Companies will, throughout the Security
Period:
(a) Negative undertakings
not, without the previous written consent of the Administrative
Agent (such consent not to be unreasonably withheld):
(i) Variations
agree to any material variation of any Approved Charter or
any Charter Guarantee; or
(ii) Releases and waivers
release any Approved Charterer or Charter Guarantor from
any of its material obligations under an Approved Charter
or Charter Guarantee or waive any breach of its material
obligations thereunder or consent to any such act or
omission of an Approved Charterer or Charter Guarantor as
would otherwise constitute such breach; or
(iii) Termination
determine an Approved Charter for any reason whatsoever;
(b) Performance of charter obligations
perform its obligations under each Approved Charter and use all
reasonable endeavours to procure that the Approved Charterer and
any Charter Guarantor shall perform their respective obligations
under the Approved Charter and any Charter Guarantee;
(c) Information
supply to the Administrative Agent all informations, accounts and
records that may be necessary or of assistance to enable the
Administrative Agent to verify the amount of all payments of
charterhire and any other amount payable under any Approved
Charter and/or the Charter Guarantee; and
(d) Assignability of charters
enter into an Approved Charter in respect of any Mortgaged Ship
the nature or terms of which do not permit the rights of the
relevant Owning Company to receive moneys under such charter to be
assigned to the Security Administrative Agent pursuant to the
relevant General Assignment.
Page 69
9 Conditions
9.1 Documents and evidence
The obligation of each Bank to make its Commitment available shall be
subject to the condition that the Administrative Agent, or its duly
authorised representative, shall have received:
(a) at the date of this Agreement or by such later date (no later than
four Banking Days before the first Drawdown Date) as the
Administrative Agent may agree the documents and evidence
specified in schedule 4 part 1; and
(b) on or prior to the Drawdown Date the documents and evidence
specified in schedule 4 part 2,
in form and substance satisfactory to the Administrative Agent.
9.2 General conditions precedent
The obligation of each Bank to make its Commitment available shall be
subject to the further conditions that, at the time of the giving of the
Drawdown Notice and on the Drawdown Date:
(a) the representations and warranties contained in clauses 7.1, 7.2
and 7.3 are true and correct on and as of each such time as if
each was made with respect to the facts and circumstances existing
at such time; and
(b) no Default shall have occurred and be continuing or would result
from the making of the Loan.
9.3 Waiver of conditions precedent
The conditions specified in this clause 9 are inserted solely for the
benefit of the Banks and may be waived on their behalf in whole or in
part and with or without conditions by the Administrative Agent acting on
the instruction of the Majority Banks (save that waiver of the conditions
requiring the documents and evidence specified in paragraphs (a), (b),
(e) and (i) of schedule 4 part 1 and (a), (b) and (h) of part 2 of
schedule 4 shall require the instructions of all of the Banks).
9.4 Notification to Banks
The Administrative Agent shall notify the Banks promptly after receipt by
it of the documents and evidence referred to in clause 9.1 in form and
substance satisfactory to it.
10 Events of Default
10.1 Events
There shall be an Event of Default if:
(a) Non-payment: any Security Party fails to pay any sum due by it
under any of the Security Documents at the time, in the currency
and in the manner stipulated in the Security Documents (and so
that, for this purpose, sums payable on demand shall be treated as
having been paid at the stipulated time if paid within three
Banking Days of demand) and such failure continues for more than
three Banking Days after written notice of non-payment by the
Administrative Agent; or
(b) Breach of Insurance and certain other obligations: any relevant
Owning Company fails to obtain and/or maintain the Insurances in
accordance with the requirements of the Security Documents for any
of the Mortgaged Ships or if any insurer in respect of such
Insurances cancels the Insurances or disclaims liability by
reason, in either case, of mis-statement in any proposal for the
Insurances or for any other failure or default on the part of any
relevant Owning Company or any other person or the Borrower
commits any breach of or omits to observe any of the obligations
or undertakings expressed to be assumed by it under clauses 8.3 or
8.5 to 8.7 (inclusive); or
(c) Breach of other obligations: any Security Party commits any breach
of or omits to observe any of its obligations or undertakings
expressed to be assumed by it under any of the Security Documents
(other than those referred to in clauses 10.1(a) and 10.1(b))
which are considered by the Majority Banks to be material and, in
respect of any such breach or omission which in the opinion of the
Majority Banks is capable of remedy, such action as the Majority
Banks may require shall not have been taken within thirty (30)
days of the Administrative Agent notifying the relevant Security
Party of such default and of such required action; or
Page 70
(d) Misrepresentation: any representation or warranty made or deemed
to be made or repeated by or in respect of any Security Party in
or pursuant to any of the Security Documents or in any notice,
certificate or statement referred to in or delivered under any of
the Security Documents is or proves to have been incorrect or
misleading in any material respect when made or deemed to be made
or repeated; or
(e) Cross-default: at any time the aggregate amount at such time of:
(i) any Borrowed Money or Swap Liabilities of any Security
Party or any other member of the Golar LNG Group which is
not paid when due and remains unpaid;
(ii) any Borrowed Money of any Security Party or any other
member of the Golar LNG Group which has become (whether by
declaration or automatically in accordance with the
relevant agreement or instrument constituting the same), or
is capable of being declared due and payable prior to the
date when it would otherwise have become due (unless as a
result of the exercise by the relevant person of a
voluntary right of prepayment or upon mandatory prepayment
as a result of a change of law or other circumstances not
constituting an event of default under, or breach of, any
agreement regulating and/or securing the relevant Borrowed
Money);
(iii) any facility or commitment available to any Security Party
or any other member of the Golar LNG Group relating to
Borrowed Money which has been withdrawn, suspended or
cancelled by reason of any default (however described) of
the person concerned;
(iv) the amount of Swap Liabilities of any Security Party or any
other member of the Golar LNG Group which are due or
capable of being declared due upon early termination of the
relevant transaction by the relevant counterparty; and
(v) any amounts demanded of, but not paid when due and
remaining unpaid by any Security Party or any other member
of the Golar LNG Group under any guarantee in respect of
Borrowed Money or Swap Liabilities
exceeds USD5,000,000; or
(f) Legal process: any judgment or order made against the Borrower is
not stayed or complied with within 30 days or a creditor attaches
or takes possession of, or a distress, execution, sequestration or
other process is levied or enforced upon or sued out against, all
or a substantial part of the undertakings, assets, rights or
revenues of the Borrower and is not discharged within 30 days; or
(g) Insolvency: the Borrower becomes insolvent or stops or suspends
making payments (whether of principal or interest) with respect to
all or any class of its debts or announces an intention to do so;
or
Page 71
(h) Reduction or loss of capital: a meeting is convened by the
Borrower for the purpose of passing any resolution to purchase,
reduce or redeem any of its share capital (save and to the extent
that such purchase reduction or redemption of share capital is
permitted by clause 8.3(c)); or
(i) Winding up: any petition is presented by the Borrower, the
shareholders of the Borrower or its directors or other step is
taken by the Borrower, the shareholders of the Borrower or its
directors for the purpose of winding up the Borrower or an order
is made or resolution passed for the winding up of the Borrower or
a notice is issued convening a meeting for the purpose of passing
any such resolution; or
(j) Administration: any petition is presented or other step is taken
by the Borrower or its directors for the purpose of the
appointment of an administrator of the Borrower or an
administration order is made in relation to the Borrower; or
(k) Appointment of receivers and managers: any administrative or other
receiver is appointed of the Borrower or all or any substantial
part of its assets and/or undertaking or any other steps are taken
to enforce any Encumbrance over all or any substantial part of the
assets of the Borrower; or
(l) Compositions: the Borrower enters into any kind of composition,
compromise or arrangement with its creditors generally (or any
class of them); or
(m) Analogous proceedings: there occurs, in relation to the Borrower,
in any Relevant Jurisdiction or to the jurisdiction of whose
courts any part of their assets is subject, any event which, in
the reasonable opinion of the Administrative Agent, appears in
that country or territory to correspond with, or have an effect
equivalent or similar to, any of those mentioned in clauses
10.1(g) to (l) (inclusive) or the Borrower otherwise becomes
subject, in any such country or territory, to the operation of any
law relating to insolvency, bankruptcy or liquidation; or
(n) Cessation of business: the Borrower suspends or ceases to carry on
its business; or
(o) Seizure: all or a material part of the undertaking, assets, rights
or revenues of, or shares or other ownership interests in, the
Borrower are seized, nationalised, expropriated or compulsorily
acquired by or under the authority of any government; or
(p) Other parties: any of the events or circumstances described in
clauses 10.1(f) to (o) (inclusive) arises or occurs (mutatis
mutandis) in relation to any of:
(i) any other Security Party; or
(ii) any other member of the Golar LNG Group; or
(iii) Faraway; or
(q) Invalidity: any of the Security Documents shall at any time and
for any reason become invalid or unenforceable or otherwise cease
to remain in full force and effect in any respect which the
Majority Banks consider to be material or if the validity or
enforceability of any of the Security Documents shall at any time
and for any reason be contested by any Security Party which is a
party thereto, or if any such Security Party shall deny that it
has any, or any further, liability thereunder; or
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(r) Unlawfulness: it becomes impossible or unlawful at any time for
any Security Party, to fulfil any of the covenants and obligations
expressed to be assumed by it in any of the Security Documents or
for the Security Agent to exercise the rights or any of them
vested in it or them under any of the Security Documents or
otherwise; or
(s) Repudiation: any Security Party repudiates any of the Security
Documents or does or causes or permits to be done any act or thing
evidencing an intention to repudiate any of the Security
Documents; or
(t) Encumbrances enforced: any Encumbrance (other than Permitted
Liens) in respect of any of the property (or part thereof) which
is the subject of any of the Security Documents is enforced; or
(u) Material adverse change: there occurs a material adverse change in
the financial condition of the Borrower or any member of the Golar
LNG Group or of the Golar LNG Group taken as a whole the effect of
which is, in the opinion of the Administrative Agent, materially
to imperil, delay or prevent the due fulfilment by such person of
any of their respective obligations contained in the Security
Documents; or
(v) Arrest: any Mortgaged Ship or Xxxxx Xxxx is arrested, confiscated,
seized, taken in execution, impounded, forfeited, detained in
exercise or purported exercise of any possessory lien or other
claim and the relevant Owning Company or (as the case maybe)
Faraway shall fail to procure the release of such Ship or Xxxxx
Xxxx within a period of ten (10) Banking Days thereafter (or such
longer period as the Administrative Agent may agree in writing);
or
(w) Registration: the registration of any Mortgaged Ship under the
laws and flag of the relevant Flag State is cancelled or
terminated or, where applicable, not renewed without the prior
written consent of the Administrative Agent; or
(x) Unrest: the Flag State of any Mortgaged Ship or any Relevant
Jurisdiction becomes involved in hostilities or civil war or there
is a seizure of power in the Flag State or any Relevant
Jurisdiction by unconstitutional means if, in any such case, such
event could in the opinion of the Administrative Agent may be
expected to have a material adverse effect on the security created
by any of the Security Documents and, within 14 days of notice
from the Administrative Agent to do so, the relevant Owning
Company has not taken all such action as the Administrative Agent
may require to ensure that such circumstances will not have such
an effect; or
(y) Environment: the Borrower or any other member of the Golar LNG
Group fails or has failed to comply with any applicable
Environmental Law or any applicable Environmental Approval or any
Mortgaged Ship or Xxxxx Xxxx or any other vessel is or has been
involved in any incident which gives rise, has given rise or may
give rise, to an Environmental Claim against any member of the
Golar LNG Group or any vessel owned by, or bareboat chartered to,
any member of the Golar LNG Group if, in any such case, such
non-compliance or incident or the consequences thereof could, in
the opinion of the Administrative Agent and having regard to any
insurance cover available to meet any liabilities arising in
relation to such incident, have a material adverse effect on (i)
the business, assets, operations, property or financial condition
of the Borrower or any Owning Company or Faraway or the Golar LNG
Group as a whole or (ii) the security created by any of the
Security Documents or (iii) the ability of the Security Agent to
enforce the Security Documents in accordance with their terms; or
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(z) P&I: the Borrower, the Owning Company of any Mortgaged Ship or
Faraway or any other person fails or omits to comply with any
requirements of the protection and indemnity association or other
insurer with which such Mortgaged Ship or Xxxxx Xxxx is entered
for insurance or insured against protection and indemnity risks
(including oil pollution risks) to the effect that any such cover
(including without limitation) cover (including, without
limitation, cover in such of liability for Environmental Claims
arising in jurisdictions where such Mortgaged Ship or (as the case
maybe) Xxxxx Xxxx operates or trades) is, or may be liable to
cancellation, qualification or exclusion at any time; or
(aa) Termination of Approved Charter: any Approved Charter of any
Mortgaged Ship or Xxxxx Xxxx is cancelled or terminated by the
relevant Approved Charterer by reason of the Owning Company's or
Faraway's breach; or
(bb) Termination of Approved Management Agreements: any Approved
Management Agreement is cancelled or rescinded or otherwise
terminated in relation to a Mortgaged Ship or Xxxxx Xxxx for any
reason whatsoever without the prior written consent of the
Administrative Agent (acting on the instructions of the Majority
Banks); or
(cc) Change of control:
save with the prior written consent of the Banks (which the Banks
shall have full liberty to withhold):
(i) the Borrower is not, or ceases to be a wholly owned
Subsidiary of the Parent; or
(ii) the Owning Companies, Oxbow or Golar Maritime are not or
cease to be wholly owned Subsidiaries of the Borrower (save
where, in the case of an Owning Company, such Owning
Company is sold as contemplated by clause 4.3 and the
Borrower has complied with its obligations under clause 4.3
arising on such sale); or
(iii) Oxbow and Golar Maritime cease to hold at least 60% of the
issued share capital in Faraway (save where the shares are
sold as contemplated by clause 4.3, where the Borrower has
complied with its obligations under clause 4.3 arising on
such sale); or
(dd) Stock exchange listing of Parent: save with the prior consent of
Majority Banks, the issued ordinary share capital of the Parent is
not listed on the Oslo Stock Exchange or the New York Stock
Exchange within ninety (90) days of the Drawdown Date or ceases to
be so listed or;
(ee) Sale of shares in Parent: Osprey or any directly or indirectly
wholly owned Subsidiary of Greenwich Holdings Limited
("Greenwich") shall, save with the prior written consent of the
Majority Banks, at any time prior to the stock exchange listing of
the Parent on the Oslo or New York Stock Exchange cease to be
legal and beneficial owner, directly or indirectly, of at least
50% of the ordinary share capital of the Parent; or
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(ff) Ownership interest in Parent: except with the prior written
consent of all of the Banks, following the stock exchange listing
of the Parent on the Oslo or New York Stock Exchange, Osprey or
any directly or indirectly wholly owned Subsidiary of Greenwich or
Greenwich itself ceases to be the legal and beneficial owner,
directly or indirectly, of at least 25% of the ordinary share
capital of the Parent; or
(gg) Greenwich guarantee: Greenwich commits any breach of or omits to
observe any of its obligations under the guarantee of even date
herewith executed by Greenwich in favour of the Security Agent or
such guarantee shall at any time and for any reason become invalid
or unenforceable or otherwise cease to remain in full force and
effect otherwise than in accordance with its terms.
10.2 Acceleration
The Administrative Agent, if so requested by the Majority Banks, shall
without prejudice to any other rights of the Banks, at any time after the
happening of an Event of Default which is then continuing by notice to
the Borrower declare that:
(a) the obligation of each Bank to make its Commitment available shall
be terminated, whereupon the Total Commitments shall be reduced to
zero forthwith; and/or
(b) the Loan and all interest and commitment commission accrued and
all other sums payable under the Security Documents have become
due and payable, whereupon the same shall, immediately or in
accordance with the terms of such notice, become due and payable.
10.3 Demand basis
If, pursuant to clause 10.2(b) the Administrative Agent declares the Loan
to be due and payable on demand, the Administrative Agent may (and, if so
instructed by the Majority Banks, shall) by written notice to the
Borrower (a) call for repayment of the Loan on such date as may be
specified whereupon the Loan shall become due and payable on the date so
specified together with all interest and any commitment commission
accrued and all other sums payable under this Agreement or (b) withdraw
such declaration with effect from the date specified in such notice.
11 Indemnities
11.1 Miscellaneous indemnities
The Borrower shall on demand indemnify each Creditor, without prejudice
to any of their other rights under any of the Security Documents, against
any loss or expense which such Creditor shall certify as sustained or
incurred by it as a consequence of:
(a) any default in payment by the Borrower of any sum under any of the
Security Documents when due;
(b) the occurrence of any Event of Default;
(c) receiving or recovering all or any part of a sum unpaid otherwise
than on the due date for the payment of interest in respect
thereof;
(d) any prepayment of the Loan or part thereof being made under
clauses 4.2, 4.3, 4.6 or 12.1, or any other repayment or
prepayment of the Loan or part thereof being made otherwise than
on a Rollover Date being repair or prepaid; or
(e) the Loan or any part thereof not being made for any reason
(excluding any default by the relevant Creditor) on the date
specified in the Drawdown Notice once given
including, in any such case, but not limited to, any loss or expense
sustained or incurred by any Creditor in maintaining or funding its
Contribution or any part thereof or in liquidating or re-employing
deposits from third parties acquired or contracted for to fund, effect or
maintain its Contribution or any part thereof (collectively "Breakage
Costs").
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11.2 Currency indemnity
If any sum due from the Borrower under any of the Security Documents 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 the relevant Security Document or under such order or
judgment into another currency (the "second currency") for the purpose of
(a) making or filing a claim or proof against the Borrower, (b) obtaining
an order or judgment in any court or other tribunal or (c) enforcing any
order or judgment given or made in relation to any of the Security
Documents, the Borrower shall indemnify and hold harmless each Creditor
from and against any loss suffered as a result of any difference between
(i) the rate of exchange used for such purpose to convert the sum in
question from the first currency into the second currency and (ii) the
rate or rates of exchange at which the relevant Creditor 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. Any amount due from
the Borrower under this clause 11.2 shall be due as a separate debt and
shall not be affected by judgment being obtained for any other sums due
under or in respect of any of the Security Documents and the term "rate
of exchange" includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency.
11.3 Environmental indemnity
The Borrower shall indemnify each Creditor on demand and hold each
Creditor harmless from and against all costs, expenses, payments,
charges, losses, demands, liabilities, actions, proceedings (whether
civil or criminal), penalties, fines, damages, judgements, orders,
sanctions or other outgoings of whatever nature ("Losses") which may be
suffered, incurred or paid by, or made or asserted against the relevant
Creditor at any time, whether before or after the repayment in full of
principal and interest under this Agreement, relating to, or arising
directly or indirectly in any manner or for any cause or reason
whatsoever out of an Environmental Claim made or asserted against the
such Creditor if such Environmental Claim would not have been, or been
capable of being, made or asserted against the relevant Creditor if it
had not entered into any of the Security Documents and/or exercised any
of its rights, powers and discretions thereby conferred and/or performed
any of its obligations thereunder and/or been involved in any of the
transactions contemplated by the Security Documents.
12 Unlawfulness and increased costs
12.1 Unlawfulness
It is or becomes contrary to any law or resolution for any Bank to
maintain its Commitment or to fund its Contribution or contribute to the
Loan, such Bank shall promptly inform the Administrative Agent and the
Administrative Agent shall notify the Borrower whereupon:
(a) such Bank's Commitment shall be reduced to zero;
(b) the undrawn portion of the Total Commitments shall be reduced by
the same proportion which (immediately prior to its reduction to
zero) the Commitments of the relevant Bank bore to the aggregate
of the Total Commitments (including such Bank's Commitment); and
(c) the Borrower shall be obliged to prepay the Contributions of such
Bank either (i) forthwith or (ii) on a future specified date not
being earlier than the latest date permitted by the relevant law
or regulation.
Any prepayment pursuant to this clause 12.1 shall be made together with
all amounts referred to in clause 4.4.
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12.2 Increased costs
If the result of any change in, or in the interpretation or application
of, or the introduction of, any law or any regulation, request or
requirement (whether or not having the force of law, but, if not having
the force of law, with which any Bank or, as the case may be, its holding
company habitually complies), including (without limitation) those
relating to Taxation, capital adequacy, liquidity, reserve assets, cash
ratio deposits and special deposits, is to:
(a) subject any Bank to Taxes or change the basis of Taxation of any
Bank with respect to any payment under any of the Security
Documents (other than Taxes or Taxation on the overall net income,
profits or gains of such Bank imposed in the jurisdiction in which
its principal or lending office under this Agreement is located);
and/or
(b) increase the cost to, or impose an additional cost on, any Bank or
its holding company in making or keeping its Commitment available
or funding its Contribution or otherwise in maintaining its
obligations under this Agreement; and/or
(c) reduce the amount payable or the effective return to any Bank
under any of the Security Documents; and/or
(d) reduce any Bank's or its holding company's rate of return on its
overall capital by reason of a change in the manner in which it is
required to allocate capital resources to its obligations under
any of the Security Documents; and/or
(e) require any Bank or its holding company to make a payment or forgo
a return on or calculated by reference to any amount received or
receivable by it under any of the Security Documents; and/or
(f) require any Bank or its holding company to incur or sustain a loss
(including a loss of future potential profits) by reason of being
obliged to deduct all or part of the Bank's Commitment or
Contribution from its capital for regulatory purposes,
then and in each such case (subject to clause 12.3):
(i) such Bank shall notify the Borrower in writing of such event
promptly upon its becoming aware of the same; and
(ii) the Borrower shall on demand, made at any time whether or not the
relevant Bank's Contribution has been repaid, pay to the
Administrative Agent for the account of such Bank the amount which
such Bank specifies (in a certificate setting forth the basis of
the computation of such amount but not including any matters which
such Bank or its holding company regards as confidential) is
required to compensate such Bank and/or (as the case may be) its
holding company for such liability to Taxes, cost, reduction,
payment, forgone return or loss.
For the purposes of this clause 12.2 "holding company" means the company
or entity (if any) within the consolidated supervision of which the
relevant Bank is included.
12.3 Exception
Nothing in clause 12.2 shall entitle any Bank to compensation for any
such increased costs, reduction, payment or foregoing return to the
extent that the same is the subject of an additional payment under clause
6.7 or is taken into account in calculating the Additional Cost.
12.4 Mitigation
If circumstances arise which would, or would upon the giving of notice,
result in:
(a) the Borrower being required to make an increased payment to a Bank
pursuant to clause 6.7
(b) the reduction of the Commitments of a Bank to zero or the Borrower
being required to prepay any Bank's Contribution pursuant to
clause 12.1; or
Page 77
(c) the Borrower being required to make a payment to a Bank to
compensate such Bank or its holding company for a liability to
Taxes, increased or additional cost, reduction, payment, foregone
return or loss pursuant to clause 12.2(f)(ii)
then, without in any way limiting, reducing or otherwise qualifying the
obligations of the Borrower under clauses 6.7 and 12, the Administrative
Agent and the relevant Bank shall endeavour to take such reasonable steps
(and/or, in the case of clause 12.2(f)(ii) and where the increased or
additional cost, reduction, payment, foregone return or loss is that of
its holding company, endeavour to procure that its holding company takes
such reasonable steps) as may be open to it (or, as the case may be, its
holding company) to mitigate or remove such circumstances including (in
the case of a Bank) the transfer of its rights and obligations under this
Agreement to another bank or financial institution) unless to do so might
(in the opinion of the relevant Bank) be prejudicial to such Bank (or, as
the case may be, its holding company) or be in conflict with such Bank's
(or, as the case may be, its holding company's) or the Administrative
Agent's general banking policies or involve such Bank (or, as the case
may be, its holding company) or the Administrative Agent in expense or an
increased administrative burden.
13 Set-off, pro rata payments
13.1 Set-off
The Borrower authorises each Bank (without prejudice to any of such
Bank's rights at law, in equity or otherwise), [at any time when an Event
of Default has occurred and is continuing and] without notice to the
Borrower:
(a) to apply any credit balance to which the Borrower is then entitled
standing upon any account of the Borrower with any branch of such
Bank in or towards satisfaction of any sum due and payable from
the Borrower to such Bank under any of the Security Documents;
(b) in the name of the Borrower or such Bank to do all such acts and
to execute all such documents as may be necessary or expedient to
effect such application; and
(c) to combine and/or consolidate all or any accounts in the name of
the Borrower with such Bank.
For such purposes, each Bank is authorised to purchase with the moneys
standing to the credit of such account such other currencies as may be
necessary to effect such application. No Bank shall be obliged to
exercise any right given to it by this clause 13.1. Each Bank shall
notify the Administrative Agent and the Borrower forthwith upon the
exercise or purported exercise of any right of set-off giving full
details in relation thereto and the Administrative Agent shall inform the
other Banks.
13.2 Pro rata payments
(a) If at any time any Bank (the "Recovering Bank") receives or
recovers any amount owing to it by the Borrower under this
Agreement by direct payment, set-off or in any manner other than
by payment through the Administrative Agent pursuant to clause 6.1
or 6.10 (not being a payment received from a Transferee Bank or a
sub-participant in such Bank's Contribution or any other payment
of an amount due to the Recovering Bank for its sole account
pursuant to clauses 3.1, 3.7, 4.6, 5.2, 6.7, 11.1, 11.2, 11.3,
12.1, 12.2) the Recovering Bank shall, within two Banking Days of
such receipt or recovery (a "Relevant Receipt") notify the
Administrative Agent of the amount of the Relevant Receipt. If the
Relevant Receipt exceeds the amount which the Recovering Bank
would have received if the Relevant Receipt had been received by
the Administrative Agent and distributed pursuant to clause 6.1 or
6.10 as the case may be) then:
(i) within two Banking Days of demand by the Administrative
Agent, the Recovering Bank shall pay to the Administrative
Agent an amount equal (or equivalent) to the excess;
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(ii) the Administrative Agent shall treat the excess amount so
paid by the Recovering Bank as if it were a payment made by
the Borrower and shall distribute the same to the Banks
(other than the Recovering Bank) in accordance with clause
6.10; and
(iii) as between the Borrower and the Recovering Bank the excess
amount so re-distributed shall be treated as not having
been paid but the obligations of the Borrower to the other
Banks shall, to the extent of the amount so re-distributed
to them, be treated as discharged.
(b) If any part of the Relevant Receipt subsequently has to be wholly
or partly refunded by the Recovering Bank (whether to a liquidator
or otherwise) each Bank to which any part of such Relevant Receipt
was so re-distributed shall on request from the Recovering Bank
repay to the Recovering Bank such Bank's pro rata share of the
amount which has to be refunded by the Recovering Bank.
(c) Each Bank shall on request supply to the Administrative Agent such
information as the Administrative Agent may from time to time
request for the purpose of this clause 13.2
(d) Notwithstanding the foregoing provisions of this clause 13.2 no
Recovering Bank shall be obliged to share any Relevant Receipt
which it receives or recovers pursuant to legal proceedings taken
by it to recover any sums owing to it under this Agreement with
any other party which has a legal right to, but does not, either
join in such proceedings or commence and diligently pursue
separate proceedings to enforce its rights in the same or another
court (unless the proceedings instituted by the Recovering Bank
are instituted by it without prior notice having been given to
such party through the Administrative Agent).
13.3 No release
For the avoidance of doubt it is hereby declared that failure by any
Recovering Bank to comply with the provisions of clause 13.2 shall not
release any other Recovering Bank from any of its obligations or
liabilities under clause 13.2.
13.4 No charge
The foregoing provisions of this clause 13 shall not, and shall not be
construed so as to, constitute a charge by a Bank over all or any part of
a sum received or recovered by it in the circumstances mentioned in
clause 13.2.
14 Accounts
14.1 Undertakings concerning Earnings Accounts
The Borrower undertakes with each of the Creditors that throughout the
Security Period it will procure that:
(a) Payments to Earnings Accounts
unless and until the Security Agent otherwise directs pursuant to
the General Assignments or any other Security Document, the
following will be paid to the Earnings Accounts:
(i) all Earnings of the Mortgaged Ships;
(ii) all dividends or other amounts received by Oxbow and Golar
Maritime from Faraway;
(iii) all payments to the Borrower and/or any of the Owning
Companies under any Eligible Swap Contracts;
(iv) all moneys payable under the Insurances of any Mortgaged
Ships which are payable to the relevant Owning Company or
its order in accordance with the relevant Loss Payable
Clauses and the General Assignments;
Page 79
(v) all surplus proceeds of any sale or Total Loss or any
proceeds of sale of an Owning Company or any of Oxbow and
Golar Maritime's shares in Faraway after the Borrower has
made any prepayment required under clause 4.3; and
(vi) the amount (including interest) of any fixed term deposit
account or contract referred to in clause 14.1(b)(iii) upon
maturity of the relevant fixed term;
(b) Withdrawals from Earnings Accounts
withdrawals are made from any Earnings Account only for the
purpose of:
(i) paying amounts then due under the Security Documents (other
than any prepayment of the Loan pursuant to clauses 4.3 or
4.6 of this Agreement but, for the avoidance of doubt,
withdrawals from Earnings Accounts may be made for the
purpose of making a prepayment required under clause 12.1);
(ii) paying amounts then due in respect of Eligible Swap
Liabilities or the Operating Costs of Mortgaged Ships;
(iii) payment of funds from one Earnings Account to another or
(provided that the relevant account or contract will be
subject to a valid Earnings Account security and notice of
assignment thereof has been given to, and acknowledged by,
the Account Bank in accordance with such Earnings Account
Security) their investment in a Dollar fixed term deposit
account or contract placed or made with the Account Bank on
terms that the funds so invested and interest earned
thereon shall be credited to such Earnings Account on
maturity of the relevant fixed term deposit account or
contract;
(iv) payment of Equity Distributions permitted under provisos
(A) or (C) to clause 8.3(c);
(v) discharging other liabilities or meeting any other
expenditure incurred by the Owning Companies which have
been demonstrated to the satisfaction of the Administrative
Agent to have been reasonably and properly incurred in the
ordinary course of the relevant Owning Company's business
of owning and operating its Mortgaged Ship (which shall
not, for the avoidance of doubt, include any capital
expenditure not falling within the definition of Operating
Costs and shall not include any other expenditure in
respect of any liability arising or incurred in breach of
this Agreement); or
and that (notwithstanding the foregoing) no withdrawal whatsoever
is made from any Earnings Account if, immediately following such
withdrawal, the Free Available Cash would be less than the Minimum
Free Available Cash;
(c) Security over accounts
if an account is to be designated as an Earnings Account for the
purposes of the Security Documents there is duly delivered to the
Security Agent at or before the time such account is so
designated:
(i) a deed of assignment (an "Account Charge") in respect of
such account, duly executed by the relevant account party
in such form as the Security Agent may reasonably require
(which shall, so far as the Security Agent considers the
circumstances permit), be based upon the agreed form of the
Earnings Accounts Security or in such other form as the
Security Agent may reasonably require for the purpose of
creating effective security over such account under any
applicable laws;
Page 80
(ii) such notices to, and acknowledgements from, the relevant
Account Bank as may be required by such Account Charge;
(iii) in relation to the account holder executing such Account
Charge and such Account Charge itself such documents and
evidence in form and substance satisfactory to the Security
Agent of the kind referred to in paragraphs (a), (b), (c)
and (d) of Part 1 of schedule 4 as the Security Agent may
reasonably require and that such account has been opened;
and
(iv) such satisfactory legal opinion as the Security Agent may
reasonably require as to the execution, validity and
effectiveness of such Account Charge
provided that the Security Agent may waive the delivery of the
documents and evidence referred to in paragraphs (i) and/or (iv)
if it considers that an existing Account Charge constitutes
effective and satisfactory security over such account.
15 Transfer and lending office
15.1 Benefit and burden
This Agreement shall be binding upon, and enure for the benefit of, each
of the Creditors and the Borrower and their respective successors.
15.2 No assignment by Borrower
The Borrower may not assign or transfer any of its rights or obligations
under any of the Security Documents.
15.3 Transfers
Any Bank (the "Transferor Bank") may at any time, cause all or any part
of its rights, benefits and/or obligations under this Agreement and the
Security Documents to be transferred to its Subsidiaries, affiliates or
associates or to a federal reserve bank, central bank or other monetary
or regulatory authority having jurisdiction over such Banks without the
consent of the Borrower or so long as no Default is then continuing, with
the consent of the Borrower (such consent not to be unreasonably withheld
(and for the purposes of this clause 15.3, it shall be deemed
unreasonable for the Borrower to withhold such consent on the grounds
that any proposed transfer by a Bank of part of its rights, benefits
and/or obligations would result in the number of Banks being increased
if, after such transfer, there would be no more than 15 Banks)), to any
other bank or financial institution (a "Transferee Bank") by delivering
to the Administrative Agent a Transfer Certificate duly completed and
duly executed by the Transferor Bank and the Transferee Bank.
Page 81
Any transfer by a Bank shall be offered and effected in compliance with
all applicable laws and regulations. If the Borrower fails to respond to
a request for such consent within ten (10) days of such request being
made, the Borrower shall be deemed to have given such consent. No such
transfer is binding on, or effective in relation to, the Borrower, the
Administrative Agent, or the Security Agent unless it is effected or
evidenced by a Transfer Certificate which complies with the provisions of
this clause 15.3 and is signed by or on behalf of the Transferor Bank,
the Transferee Bank and the Administrative Agent (on behalf of itself,
the Borrower, the Security Agent and the other Banks). Upon signature of
any such Transfer Certificate by the Administrative Agent, which
signature shall be effected as promptly as is practicable after such
Transfer Certificate has been delivered to the Administrative Agent, and
subject to the terms of such Transfer Certificate, such Transfer
Certificate shall have effect as set out below.
The following further provisions shall have effect in relation to any
Transfer Certificate:
(a) a Transfer Certificate may be in respect of a Bank's rights in
respect of all or part, of its Commitment and shall be in respect
of the same proportion of its Contribution;
(b) a Transfer Certificate shall only be in respect of rights and
obligations of the Transferor Bank in its capacity as a Bank and
shall not transfer its rights and obligations as Administrative
Agent or Security Agent or in any other capacity, as the case may
be and such other rights and obligations may only be transferred
in accordance with any applicable provisions of the Agency
Agreement;
(c) a Transfer Certificate shall take effect in accordance with
English law as follows:
(i) to the extent specified in the Transfer Certificate, the
Transferor Bank's payment rights and all its other rights
(other than those referred to in paragraph (b) above) under
this Agreement are assigned to the Transferee Bank
absolutely, free of any defects in the Transferor Bank's
title and of any rights or equities which the Borrower had
against the Transferor Bank;
(ii) the Transferor Bank's Commitment is discharged to the
extent specified in the Transfer Certificate;
(iii) the Transferee Bank becomes a Bank with a Contribution and
an undrawn Commitment of the amount specified in the
Transfer Certificate;
(iv) the Transferee Bank becomes bound by all the provisions of
this Agreement and the Security Documents which are
applicable to the Banks generally, including those about
pro-rata sharing and the exclusion of liability on the part
of, and the indemnification of, the Administrative Agent
and the Security Agent in accordance with the provisions of
the Agency Agreement and to the extent that the Transferee
Bank becomes bound by those provisions, the Transferor Bank
ceases to be bound by them;
Page 82
(v) the Contributions which the Transferee Bank makes after the
Transfer Certificate comes into effect rank in point of
priority and security in the same way as it would have
ranked had it been made by the Transferor Bank, assuming
that any defects in the Transferor Bank's title and any
rights or equities of any Security Party against the
Transferor Bank had not existed; and
(vi) the Transferee Bank becomes entitled to all the rights
under this Agreement which are applicable to the Banks
generally, including but not limited to those relating to
the Majority Banks and those under clauses 3.7, 5 and 12,
and to the extent that the Transferee Bank becomes entitled
to such rights, the Transferor Bank ceases to be entitled
to them;
(d) the rights and equities of the Borrower or of any other Security
Party referred to above include, but are not limited to, any right
of set off and any other kind of cross-claim; and
(e) the Borrower, the Security Agent and the Banks hereby irrevocably
authorise and instruct the Administrative Agent to sign any such
Transfer Certificate on its behalf (and, in the case of the
Security Agent, on behalf of any Security Party which has in the
relevant Security Document given a corresponding authorisation and
instruction to the Security Agent) and undertake not to withdraw,
revoke or qualify such authority or instruction at any time.
Promptly upon its signature of any Transfer Certificate, the
Administrative Agent shall notify the Borrower, the Security Agent
the Transferor Bank, the Transferee Bank and the other Banks.
15.4 Reliance on Transfer Certificate
(a) The Administrative Agent shall be entitled to rely on any Transfer
Certificate believed by it to be genuine and correct and to have
been presented or signed by the persons by whom it purports to
have been presented or signed, and shall not be liable to any of
the parties to this Agreement and the Security Documents for the
consequences of such reliance.
(b) The Administrative Agent shall at all times during the
continuation of this Agreement maintain a register in which it
shall record the name, Commitments, or, as the case may be,
Contributions and administrative details (including the lending
office) from time to time of each Bank holding Transfer
Certificates and the date at which the transfer referred to in
such Transfer Certificate held by each Bank was transferred to
such Bank, and the Administrative Agent shall make the said
register available for inspection by any Bank, the Security Agent
and the Borrower during normal banking hours upon receipt by the
Administrative Agent of reasonable prior notice requesting the
Administrative Agent to do so.
(c) The entries on the said register shall, in the absence of manifest
error, be conclusive in determining the identities of the
Commitments or, as the case may be, the Contributions and the
Transfer Certificates held by the Banks from time to time and the
principal amounts of such Transfer Certificates and may be relied
upon by the Administrative Agent, the Security Agent and the other
Security Parties for all purposes in connection with this
Agreement and the Security Documents.
15.5 Transfer fees and expenses
If any Bank causes the transfer of all or any part of its rights,
benefits and/or obligations under the Security Documents, it shall pay to
the Administrative Agent for its own account a registration fee of
USD1,000 for each transfer, and shall also pay to the Administrative
Agent on demand all out of pocket costs, fees and expenses (including,
but not limited to, legal fees and expenses), and all value added tax
thereon, certified by the Administrative Agent as having been reasonably
and properly incurred by it in connection with such transfer.
Page 83
15.6 Documenting transfers
If any Bank transfers all or any part of its rights, benefits and/or
obligations as provided in clause 15.3 the Borrower undertakes,
immediately on being requested to do so by the Administrative Agent and
at the cost of the Transferor Bank, to enter into, and procure that the
other Security Parties shall enter into, such documents as may be
necessary or desirable to transfer to the Transferee Bank all or the
relevant part of such Bank's interest in the Security Documents and all
relevant references in this Agreement to such Bank shall thereafter be
construed as a reference to the Bank and/or its Transferee Bank (as the
case may be) to the extent of their respective interests.
15.7 Sub-participation
A Bank may sub-participate all or any part of its rights and/or
obligations under the Security Documents without the consent of, or
notice to, the Borrower.
15.8 Lending office
Each Bank shall lend through its office at the address specified in 0 or,
as the case may be, in any relevant Transfer Certificate or through any
other office of such Bank selected from time to time by it through which
such Bank wishes to lend for the purposes of this Agreement. If the
office through which such Bank is lending is changed pursuant to this
clause 15.8, such Bank shall notify the Administrative Agent promptly of
such change and the Administrative Agent shall notify the Borrower.
15.9 Disclosure of information
Any Bank may (with the prior written consent of the Borrower such consent
not to be unreasonable withheld or delayed) disclose to a prospective
assignee, substitute or transferee or to any other person who may propose
entering into contractual relations with such Bank in relation to this
Agreement such information about the Borrower as such Bank shall consider
appropriate.
15.10 Assignments by Swap Banks
The Swap Banks may assign their rights under the Security Documents to
any person to whom they assign their rights under the relevant Eligible
Swap Contracts, provided that the assignee has entered into an
undertaking in such form as the Security Agent may require agreeing to be
bound by the terms of the Security Documents.
16 Administrative Agent, Security Agent and Reference Banks
16.1 Appointment of the Administrative Agent and the Security Agent
The terms and basis on which the Administrative Agent and the Security
Agent have been appointed by the Banks as facility agent and by the Banks
and the Swap Banks as security agent and trustee respectively are set out
in the Agency Agreement including, among other things, the manner in
which any decision to exercise any right, powers, discretion or authority
or to carry out any duty are to be made between the Banks, the Swap
Banks, the Administrative Agent and the Security Agent.
16.2 Reference Banks
If (a) the whole of the Contributions (if any) of any Reference Bank is
prepaid or (b) the Commitments (if any) of any Reference Bank are reduced
to zero in accordance with clauses 4.6 or 12 or (c) a Reference Bank
transfers the whole of its rights and obligations (if any) as a Bank
under this Agreement or (d), where applicable, any Reference Bank ceases
to provide quotations to the Administrative Agent for the purposes of
determining LIBOR, the Administrative Agent may, acting on the
instructions of the Majority Banks, terminate the appointment of such
Reference Bank and appoint another Bank to replace such Reference Bank.
Page 84
17 Tax Lease Option
If the Borrower or an Owning Company wishes to incur Borrowed Money by
means of a Capitalised Lease Obligation in respect of a Mortgaged Ship,
the Banks shall, if so requested in writing by the Borrower, discuss in
good faith for a period of up to 60 days the possible restructuring of
the security arrangements contemplated by this Agreement so as to permit
such incurrence of Borrowed Money but such restructuring may only be
implemented if all of the Banks approve it in writing (such approval not
to be unreasonably withheld) and such supplemental documentation entered
into and conditions precedent fulfilled as the Banks may in their
absolute discretion require. It is acknowledged by all parties that the
restructuring of the security may include the granting of second priority
security to secure the relevant Capitalised Lease Obligation and the Swap
Banks acknowledge that their second priority rights to the Mortgaged
Ships shall be postponed and/or replaced with alternative security
acceptable to the Swap Banks to be agreed at the relevant time.
If any such restructuring is approved in principle by the Banks and the
Swap Banks, the Banks and the Swap Banks shall co-operate in good faith
with the Borrower in the implementation of such restructuring within such
period as may be agreed at the relevant time.
If in the course of seeking the approval of the Banks to the Tax Lease
Option, a majority of the Banks the aggregate of whose Commitments and/or
Contribution (as the case may be) exceeds 662/3% of the Total
Commitments, agree to the restructuring proposal (the "consenting banks")
then the consenting banks shall if requested to do so by the Borrower
co-operate with the Borrower to try to arrange for the Commitment and/or
Contribution (as the case may be) of the Banks who do not agree the
restructuring proposal (the "dissenting banks") to be transferred to a
substitute or replacement bank (a "substitute bank") provided that if no
substitute bank can be found within such reasonable period as may be
agreed by the Administrative Agent at the relevant time to assume the
Contribution and/or Commitment of the dissenting bank or banks, the
Borrower agrees that the approval of all the Banks to the Tax Lease
Option shall be deemed to be required.
18 Notices and other matters
18.1 Notices
Every notice, request, demand or other communication under this Agreement
or (unless otherwise provided therein) under any of the other Security
Documents shall:
(a) be in writing delivered personally or by first-class prepaid
letter (airmail if available) or facsimile transmission or other
means of telecommunication in permanent written form;
(b) be deemed to have been received, subject as otherwise provided in
the relevant Security Document, in the case of a letter, when
delivered personally or 7 days after it has been put in to the
post and, in the case of a facsimile transmission or other means
of telecommunication in permanent written form, at the time of
despatch (provided that if the date of despatch is not a business
day in the country of the addressee or if the time of despatch is
after the close of business in the country of the addressee it
shall be deemed to have been received at the opening of business
on the next such business day); and
Page 85
(c) be sent:
(i) to the Borrower at:
Golar Gas Holding Company, Inc.
c/o Osprey Maritime (Europe) Ltd.
00 Xxxxx Xxxx
Xxxxxx X00 0XX
Fax no: (00) 000 000 0000
Attention: The President
(ii) to the Administrative Agent at:
Christiania Bank og Kreditkasse ASA
X.X. Xxx 0000, Xxxxxxx
0000 Xxxx
Xxxxxx
Fax no: 00 00 00 00 00 00
Attention: Shipping Dept.
(iii) to the Security Agent at:
Xxxxxxxx 00
X-0000 Xxxx
Xxxxxx
Fax no: 00 00 00 00 00 00
Attention: Credit Administration Shipping
(iv) to each Bank at its address, telex or fax number specified
in schedule 1 or in any relevant Transfer Certificate,
(v) to the Swap Banks in accordance with the terms of the
relevant Eligible Swap Contracts,
or to such other address and/or numbers as is notified by one party to
the other party under this Agreement.
18.2 No implied waivers, remedies cumulative
No failure or delay on the part of any Creditor to exercise any power,
right or remedy under any of the Security Documents shall operate as a
waiver thereof, nor shall any single or partial exercise by any Creditor
of any power, right or remedy preclude any other or further exercise
thereof or the exercise of any other power, right or remedy. The remedies
provided in the Security Documents are cumulative and are not exclusive
of any remedies provided by law.
18.3 Further assurance
The Borrower undertakes that the Security Documents shall both at the
date of execution and delivery thereof and so long as any moneys are
owing under any of the Security Documents, be valid and binding
obligations of the respective parties thereto and the rights of the
Creditors thereunder enforceable in accordance with their respective
terms and that they will, at their expense, execute, sign, perfect and
do, and will procure the execution, signing, perfecting and doing by each
of the other Security Parties of, any and every such further assurance,
document, act or thing as in the reasonable opinion of the Administrative
Agent may be necessary or desirable for perfecting the security
contemplated or constituted by the Security Documents.
Page 86
18.4 Conflicts
In the event of any conflict between this Agreement and any of the other
Security Documents, the provisions of this Agreement shall prevail.
18.5 English language
All certificates, instruments and other documents to be delivered under
or supplied in connection with any of the Security Documents shall be in
the English language or shall be accompanied by a certified English
translation upon which the Administrative Agent shall be entitled to
rely.
18.6 Contracts (Rights of Third Parties) Xxx 0000
No term of this Agreement is enforceable under the Contracts (Rights of
Third Parties) Xxx 0000 by a person who is not a party to this Agreement.
19 Governing law and jurisdiction
19.1 Law
This Agreement is governed by and shall be construed in accordance with
English law.
19.2 Submission to jurisdiction
The Borrower agrees, for the benefit of the Creditors, that any legal
action or proceedings arising out of or in connection with this Agreement
against the Borrower or any of its assets may be brought in the English
courts. The Borrower irrevocably and unconditionally submits to the
jurisdiction of such courts and irrevocably designates, appoints and
empowers Frontline Management (UK) Ltd. at present of 00 Xxxxxxxxx Xxxxx,
Xxxxxx XX0X 0XX to receive for it and on its behalf, service of process
issued out of the English courts in such legal action or proceedings. The
submission to such jurisdiction shall not (and shall not be construed so
as to) limit the right of any Creditor to take proceedings against the
Borrower in the courts of any other competent jurisdiction nor shall the
taking of proceedings in any one or more jurisdictions preclude the
taking of proceedings in any other jurisdiction, whether concurrently or
not. The parties further agree that only the courts of England and not
those of any other State shall have jurisdiction to determine any claim
which the Borrower may have against any Creditor arising out of or in
connection with this Agreement.
IN WITNESS whereof the parties to this Agreement have caused this Agreement to
be duly executed on the date first above written.
Schedule 1
Page 87
Schedule 1
Part 1 - The Banks and their Commitments
Name Address and fax number Commitment
USD
---- ---------------------- ----------
Christiania Bank og Kreditkasse ASA X.X. Xxx 0000, Xxxxxxx 00,000,000
0000 Xxxx
Xxxxxx
Fax: x00 00 00 00 00
Attention: International Loan
Administration
Den norske Bank XXX Xxxxxxxx 00 00,000,000
X-0000 Xxxx
Xxxxxx
Fax: (00) 00 00 00 00
Attention: Loan Administration
Citibank, N.A. 33 Canada Square 81,250,000
Xxxxxx Xxxxx
Xxxxxx
X00 0XX
Fax: (00) 000 000 0000
Attention: Xxxxx Xxxxx
Fortis Bank (Nederland) N.V. Credit Administration 81,250,000
Fortis Bank (Nederland) X.X.,
Xxxx Xxxxxx
Xxxxxxxxxxxxxx 00x, XX-0000 Xxxx
Xxxxxx
Telephone: (00) 00 00 00 00
Fax: (00) 00 00 00 00
Attention: Xxxxxxx Xxxxxxxxx
Loan Administration Department
Fortis Bank (Nederland) N.V.
Xxxxxxxxxx 00, 0000 XX Xxxxxxxxx,
Xxx Xxxxxxxxxxx
Telephone: (00) 00 000 00 00 / 62 54
Fax: (00) 00 000 00 00
Attention: Xxxxx Xxxxxxxxx/ Pieter van
Wijk / Xxx Xxxxxxxx / Aad Blok
Total: 325,000,000
Page 88
Part 2
The Swap Banks
Name Address and fax number
---- -----------------------
Christiania Bank og Kreditkasse ASA X.X. Xxx 0000, Xxxxxxx
0000 Xxxx
Xxxxxx
Fax: x00 00 00 00 00
Attention: International
Loan Administration
Den norske Bank XXX Xxxxxxxx 00
X-0000 Xxxx
Xxxxxx
Fax: (00) 00 00 00 00
Attention: Loan Administration
Page 89
Schedule 2
The Ships
Part 1
Details of the Ships
Name Owning Company Official No. Classification Classification
---- -------------- ------------ -------------- --------------
Society
GOLAR SPIRIT Golar Gas Faraway Inc. 6945 +1A1 Tanker for DnV
Liquified Gas EO SBM
XXXXX Xxxxx Hilli Inc. 5391 +1A1 Tanker for DnV
Liquified Gas EO SBM
XXXX Xxxxx Gimi Inc. 5683 +1A1 Tanker for DnV
Liquified Gas EO SBM
XXXXXXX Xxxxx Xxxxxxx Inc. 5978 +1A1 Tanker for DnV
Liquified Gas EO SBM
GOLAR FREEZE Golar Freeze Inc. 5824 +1A1 Tanker for DnV
Liquified Gas EO SBM
In this schedule "DnV" means Det Norske Veritas.
Page 90
Part 2
Details of Approved Charterers, Charter Guarantees
and Management Agreements as at the date of this Agreement
GOLAR SPIRIT
Approved Charter
Time charter dated 9 September 1983 between Pertamina and Golar Gas Cryogenics
Inc. as amended by Addendum No. 1 dated 2 July 1986 and Addendum No. 2 dated 20
February 1990 expiry on or about 1 December 2006 subject to charterer's option
to extend.
Charter Guarantee
None.
Approved Management Agreement
Management Agreement dated 1 January 1999 between Golar Gas Cryogenics Inc. and
Osprey Maritime Management Limited.
HILLI
Approved Charter
Short term pre-emption charter dated 7 September 2000 between Xxxxx Xxxxx Inc.
and Methane Services Limited entered into pursuant to the Master Agreement
covering period until delivery under long term charter.
Long term charter to be entered into between Xxxxx Xxxxx Inc. and Methane
Services Limited in accordance with the notice of exercise of option under the
Master Agreement dated 3 May 2001, such charter to expire during 2013, subject
to charterer's option to extend.
Charter Guarantee
(a) Guarantee dated 7 September 2000 from BG International Limited in favour of
Xxxxx Xxxxx Inc. (in respect of pre-emption charter).
(b) Guarantee dated 8 May 2001 from BG International Limited in favour of Xxxxx
Xxxxx Inc. (in respect of long term charter).
Page 91
Approved Management Agreement
Management Agreement dated 1 January 1999 between Xxxxx Xxxxx Inc. and Osprey
Maritime Management Limited.
GIMI
Approved Charter
Short term pre-emption charter to be entered into between Xxxxx Xxxx Inc. and
Methane Services Limited pursuant to the Master Agreement covering period until
delivery under long term charter.
Long term time charter dated 28 January 2000 between Xxxxx Xxxx Inc. and Methane
Services Limited entered into pursuant to the Master Agreement expiry during
2012 subject to charterer's option to extend.
Charter Guarantee
Guarantee dated 2 March 2000 from BG International Limited in favour of Xxxxx
Xxxx Inc. (in respect of long term charter)
Approved Management Agreement
Management Agreement dated 1 January 1999 between Xxxxx Xxxx Inc. and Osprey
Maritime Management Limited.
KHANNUR
Approved Charter
Short term pre-emption charter dated 30 November 2000 between Xxxxx Xxxxxxx Inc.
and Methane Services Limited entered into pursuant to the Master Agreement
covering period until delivery under long term charter.
Long term time charter dated 12 August 1999 between Xxxxx Xxxxxxx Inc. and
Methane Services Limited as amended by Addendum No. 1 dated December 1999
entered into pursuant to the Master Agreement expiry during 2009 subject to
charterer's option to extend.
Charter Guarantee
Guarantee dated 30 November 2000 from BG International Limited in favour of
Xxxxx Xxxxxxx Inc. (in respect of long term charter).
Approved Management Agreement
Management Agreement dated 1 January 1999 between Xxxxx Xxxxxxx Inc. and Osprey
Maritime Management Limited.
Page 92
GOLAR FREEZE
Approved Charter
Short term pre-emption charter dated 7 September 2000 between Golar Freeze Inc.
and Methane Services Limited entered into pursuant to the Master Agreement, such
charter to expire on 31 December 2002 subject to charterer's option to extend or
enter into a long term charter in accordance with the terms of the Master
Agreement.
Charter Guarantee
Guarantee dated 7 September 2000 from BG International Limited and in favour of
Golar Freeze Inc. (in respect of the short term charter).
Approved Management Agreement
Management Agreement dated 1 January 1999 between Golar Freeze Inc. and Osprey
Maritime Management Limited.
In this schedule "Master Agreement" means the master agreement dated 12 August
1999 as amended by addendum no. 1 thereto dated 5 January 2000 between Xxxxx
Xxxxxxx Inc., Golar Freeze Inc., Xxxxx Xxxx Inc., Xxxxx Xxxxx Inc., Osprey
Maritime Limited and Methane Services Limited. Schedule 3
Page 93
Schedule 3
Form of Drawdown Notice
To: [Name and address of Administrative Agent]
Attention:
[o] 2001
USD325,000,000
Loan Agreement dated [o] 2001
We refer to the above Loan Agreement and hereby give you notice that we wish to
draw the Loan (in the amount of USD[325,000,000]) on [o] 2001 and select an
Interest Period in respect thereof of [o] months. The funds should be credited
to [name and number of account] with [New York City].
We confirm that:
(a) no Default has occurred and is continuing or will result from our
borrowing the Loan;
(b) the representations and warranties contained in clauses 7.1 and
7.2 of the Loan Agreement are true and correct at the date hereof
as if made with respect to the facts and circumstances existing at
such date; and
(c) the borrowing to be effected by the drawdown of the Loan will be
within our corporate powers, has been validly authorised by
appropriate corporate action and will not cause any limit on our
borrowings (whether imposed by statute, regulation, agreement or
otherwise) to be exceeded.
Words and expressions defined in the Loan Agreement shall have the same meanings
where used herein.
For and on behalf of
[Name of Borrower]
Page 94
Schedule 4
Documents and evidence required as conditions precedent
(referred to in clause 9.1)
Part 1
(General)
(a) Constitutional documents
copies, certified by an officer of each Security Party as true, complete
and up to date copies of all documents which contain or establish or
relate to the constitution of that Security Party;
(b) Corporate authorisations
copies of resolutions of the directors and stockholders of each Security
Party approving such of the Underlying Documents and the Security
Documents to which such Security Party is, or is to be, party and
authorising the signature, delivery and performance of such Security
Party's obligations thereunder, certified by an officer of such Security
Party as:
(i) being true and correct;
(ii) being duly passed at meetings of the directors of such Security
Party and (if applicable) of the stockholders of such Security
Party each duly convened and held;
(iii) not having been amended, modified or revoked; and
(iv) being in full force and effect,
together with originals or certified copies of the certificates of any
powers of attorney issued by any Security Party pursuant to such
resolutions and a certificate by an Officer of each Security Party that
no proceedings are pending or contemplated for the bankruptcy or
liquidation of the relevant company;
(c) Certificate of incumbency
a list of directors and officers of each Security Party specifying the
names and positions of such persons, certified by an officer of such
Security Party to be true, complete and up to date;
(d) Consents and approvals
a certificate from an officer of each Security Party that no consents,
authorisations, licences or approvals are necessary for such Security
Party, in the case of the Borrower, to borrow the Commitments and/or
grant security for such borrowing and, in the case of the other Security
Parties, to guarantee and/or grant security for the borrowing by the
Borrower of the Commitments pursuant to this Agreement and (in the case
of all Security Parties) to execute, deliver and perform the Security
Documents and the Underlying Documents insofar as such Security Party is
a party thereto;
Page 95
(e) Guarantees
the Guarantees, duly executed by the Guarantors;
(f) Underlying Documents
a copy, certified as a true and complete copy by an officer of the
Borrower or other person acceptable to the Administrative Agent of each
of Underlying Documents;
(g) Accounts and account security
evidence that the Earnings Accounts have been opened and the Earnings
Account Security has been duly executed by the relevant parties;
(h) Fees and expenses
evidence that the fees due under clause 5.1 have been paid in full and
that an amount of USD500,000 has been paid to the Administrative Agent on
account of the expenses referred to in clause 5.2; and
(i) Private placement
evidence that the private placement in respect of the Parent has been
fully subscribed to and the proceeds have been received or will be
received by the Parent within 7 days of the Drawdown Date.
Page 96
Part 2
(Drawdown of Loan)
(a) Ships' conditions
evidence that each Ship and Xxxxx Xxxx:
(i) Registration and Encumbrance
is registered in the name of the relevant Owning Company or (as
the case may be) Faraway through the relevant Registry as a ship
under the laws of the Flag State at the Port of Registry and that
such Ship and Xxxxx Xxxx and its Earnings, Insurances and
Requisition Compensation are free of Encumbrances other than
Permitted Encumbrances;
(ii) Classification
maintains its Classification free of all overdue requirements and
recommendations of its Classification Society;
(iii) Insurance
is insured in accordance with the provisions of the Security
Documents and all requirements of the Security Documents in
respect of such insurance have been complied with;
(iv) Management
is managed by the relevant Approved Manager under the Approved
Management Agreement relative thereto;
(v) Approved Charters
where there is an Approved Charter for a Ship as at the date of
this Agreement, is in service under such Approved Charter;
(b) Mortgages and General Assignments
the Mortgages and General Assignments for the Ships, each duly executed
by the relevant Owning Company together with any supplements thereto;
(c) Mortgage registration
evidence that the Mortgages for the Ships have been registered against
the Ships at the Registry with first priority;
Page 97
(d) Cash position
evidence that USD25,000,000 has been credited to an Earnings Account;
(e) Manager's Undertakings
the Manager's Undertakings, duly executed by the Approved Managers;
(f) Subordination Deed
the Subordination Deed duly executed by the parties thereto;
(g) Subsidiary Pledges
the Subsidiary Pledges, duly executed by the Borrower and filed in the
register of mortgages and charges of the relevant Subsidiary, together
with the other documents required to be delivered to the Security Agent
thereunder;
(h) Notices of assignment and acknowledgements
duly executed notices of assignment (together with original duly executed
acknowledgements thereof) required by the terms of the Security Documents
and in the forms prescribed by such Security Documents;
(i) Liberian opinion
an opinion of Holland & Knight LLP special legal advisers on matters of
Liberian law to the Banks;
(j) Bermuda opinion
an opinion of Xxxxxxx Xxxx & Xxxxxxx, special legal advisers in Bermuda
to the Banks;
(k) British Virgin Islands opinion
an opinion of Xxxxxxx Xxxx & Xxxxxxx, special legal advisers in the
British Virgin Islands to the Banks;
(l) Cyprus opinion
an opinion of Chrysses Xxxxxxxxxxx & Co., special legal advisers in
Cyprus to the Banks;
(m) English opinion
an opinion of Xxxxxx Xxxx, special legal advisers in England to the
Banks;
(n) Further opinions
any such further legal opinion as may be required by the Administrative
Agent;
(o) Process agents
a copy, certified as a true copy by the Borrower's solicitors or other
person acceptable to the Administrative Agent of a letter from each
Security Party's agent for receipt of service of proceedings referred to
in the Security Documents (other than the Mortgages in respect of all of
the Ships) accepting its appointment as such agent;
Page 98
(p) Insurance opinion
an opinion from Messrs Aon Grieg AS of Norway, insurance consultants to
the Administrative Agent, on the insurances effected or to be effected in
respect of the Ships upon and following the Drawdown Date;
(q) Indebtedness
evidence satisfactory to the Administrative Agent that the Borrower, the
Owning Companies, Oxbow and Golar Maritime have no outstanding
indebtedness or contingent liabilities;
(r) Pro forma financial statements
the pro forma financial statements for the year ending as of 31 May 2001
referred to in clause 7.2(x), together with an operational budget for the
Owning Companies and Faraway and the Ships and Xxxxx Xxxx for the year
beginning 1 July 2001;
(s) Hedging
the Eligible Swap Contracts duly executed by the relevant parties
thereto;
(t) Technical report
a technical report (satisfactory to the Administrative Agent) by
surveyors acceptable to the Administrative Agent and dated not earlier
than ten days prior to the Drawdown Date, in respect of the useful life
of the Ships;
(u) Osprey Maritime Limited
evidence satisfactory to the Administrative Agent that the operational
management of Osprey Maritime Limited has been transferred to the Golar
LNG Group;
(v) Parent, Borrower and Guarantor liabilities
evidence that the Parent, the Borrower and the other Guarantors have no
Indebtedness other than:
(i) under the Security Documents;
(ii) adjustments of hire due to other members of the Golar LNG Group
and Osprey; and
(iii) inter-company liabilities within the Golar LNG Group in respect of
operational costs due to the Approved Managers;
(w) Costs and expenses
evidence that all amounts owing under clause 5 which are due on the
Drawdown Date or have been demanded by the Administrative Agent under
clause 5 on or before the Drawdown Date have been or will be paid in full
on the Drawdown Date;
Page 99
(x) Maximum Liability Amount
(i) a certificate of the Borrower as to the Adjusted Net Worth and
Valuable Transfers (each as defined in the Subsidiary Guarantee)
of and received by applicable to each of the Subsidiary Guarantors
as at the date of issue of the Subsidiary Guarantee;
(ii) evidence as to subordination of intercompany debt of Subsidiary
Guarantors prior to the issue of the Subsidiary Guarantee
sufficient to ensure that the Adjusted Net Worth (as defined in
the Subsidiary Guarantee) of each Subsidiary Guarantor is a
positive figure and that any such inter-company indebtedness
remaining after the issue of the Subsidiary Guarantee is
subordinated in the terms required by clause 2.3 of the Subsidiary
Guarantee;
(iii) evidence as to the application of the full proceeds of the Loan in
making Valuable Transfers (as defined in the Subsidiary Guarantee)
to the Subsidiary Guarantors in the form of loans made by the
Borrower to the Subsidiary Guarantors;
(y) Corporate organisation
evidence that the Parent has paid the full consideration for the purchase
of the share capital in the Borrower and that the representations and
warranties in clauses 7.1(h) (shareholdings in Owning Companies, Oxbow
and Golar Maritime), 7.1(j) (shareholdings in Borrower), 7.2(s)
(shareholdings in Parent) and 7.2(y) (shareholdings in Faraway) are true
and correct;
(z) Letters of quiet enjoyment
the letters of quiet enjoyment issued by the Security Agent or, in
respect of the "Golar Spirit", the notice of financing issued by Golar
Gas Cryogenics Inc. duly acknowledged by the relevant Approved
Charterers;
(aa) Side letters
any side letters to any of the Security Documents duly executed by the
parties thereto together with any documents required pursuant to such
side letters;
(bb) Fee letter, funding indemnity letter and syndication letter
the fee letter, the funding indemnity letter and the syndication letter
duly executed by the parties thereto; and
(cc) Greenwich Guarantee
the guarantee of Greenwich Holdings Limited duly executed in a form
acceptable to the Banks.
Page 100
Schedule 5
Form of Transfer Certificate
(referred to in clause 16.3)
Transfer Certificate
Banks 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 regulations, including the
Financial Services Xxx 0000 and regulations made thereunder and similar statutes
which may be in force in other jurisdictions
To: [o], as agent on its own behalf and for and on behalf of the Borrower,
the Security Agent and the Banks defined in the Loan Agreement referred
to below.
o 200o
Attention: [o]
This certificate ("Transfer Certificate") relates to a Loan Agreement dated [o]
2001 (the "Loan Agreement") and made between (1) Golar Gas Holding Company, Inc.
(the "Borrower"), (2) Christiania Bank og Kreditkasse ASA, Den norske Bank ASA,
Citibank, N.A. and Fortis Bank (Nederland) N.V. (3), the banks and financial
institutions defined therein as banks (the "Banks"), (4) Christiania Bank og
Kreditkasse ASA as Administrative Agent, (5) Den norske Bank ASA as Security
Agent and (6) Citibank, N.A. as Book Runner for a loan facility of up to
USD325,000,000. Terms defined in the Loan Agreement shall, unless otherwise
defined herein, have the same meanings herein as therein.
In this Certificate:
the "Transferor" means [full name] of [lending office]; and
the "Transferee" means [full name] of [lending office].
1 The Transferor with full title guarantee assigns to the Transferee
absolutely all rights and interests (present, future or contingent) which
the Transferor has as a Bank under or by virtue of the Loan Agreement and
all the Security Documents in relation to [ ] per centum ([ ]%) of the
Contribution of the Transferor (or its predecessors in title) which are
set out below:
Page 101
Date of Contribution Amount
[o] USD [o]
2 By virtue of this Transfer Certificate and clause 15 of the Loan
Agreement, the Transferor is discharged [entirely from its undrawn
Commitment which amounts to USD[o]] [from [o] per centum ([o]%) of its
undrawn Commitment, which percentage represents USD[o]].]
3 The Transferee hereby requests the Borrower, the Administrative Agent,
the Security Agent and the Banks to accept the executed copies of this
Transfer Certificate as being delivered pursuant to and for the purposes
of clause 15.3 of the Loan Agreement so as to take effect in accordance
with the terms thereof on [date of transfer].
4 The Transferee:
(i) confirms that it has received a copy of the Loan Agreement and the
Security Documents together with such other documents and
information as it has required in connection with the transaction
contemplated thereby;
(ii) confirms that it has not relied and will not hereafter rely on the
Transferor, the Administrative Agent or the Security Agent to
check or enquire on its behalf into the legality, validity,
effectiveness, adequacy, accuracy or completeness of the Loan
Agreement, any of the Security Documents or any such documents or
information;
(iii) agrees that it has not relied and will not rely on the Transferor,
the Administrative Agent, the Security Agent or the Banks to
assess or keep under review on its behalf the financial condition,
creditworthiness, condition, affairs, status or nature of the
Borrower or any other Security Party (save as otherwise expressly
provided therein);
(iv) warrants that it has power and authority to become a party to the
Loan Agreement 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 and the Security Documents;
(v) acknowledges and accepts the provisions of paragraph 4(iii) above;
and
(vi) if not already a Bank, appoints the Administrative Agent to act as
its agent and the Security Agent to act as its trustee as provided
in the Agreement and the Security Documents and agrees to be bound
by the terms of the Agency Agreement.
Page 102
5 The Transferor:
(i) 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;
(ii) warrants to the Transferee that this Transfer Certificate is
binding on the Transferor under the laws of England, [the country
in which the Transferor is incorporated and the country in which
its lending office is located]; and
(iii) 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 a similar purpose.
6 The Transferee hereby undertakes with the Transferor and each of the
other parties to the Loan Agreement and the other Security Documents that
it will perform in accordance with its terms all those obligations which
by the terms of the Loan Agreement and the other Security Documents will
be assumed by it after delivery of the executed copies of this Transfer
Certificate to the Administrative Agent and satisfaction of the
conditions (if any) subject to which this Transfer Certificate is
expressed to take effect.
7 By execution of this Transfer Certificate on their behalf by the
Administrative Agent and in reliance upon the representations and
warranties of the Transferee, the Borrower, the Administrative Agent, the
Security Agent, the Book Runner and the Banks accept the Transferee as a
party to the Loan Agreement and the Security Documents with respect to
all those rights and/or obligations which by the terms of the Loan
Agreement and the Security Documents will be assumed by the Transferee
(including those about pro-rata sharing and the exclusion of liability on
the part of, and the indemnification of, the Administrative Agent and the
Security Agent as provided by the Agency Agreement and the Loan
Agreement) after delivery of the executed copies of this Transfer
Certificate to the Administrative Agent and satisfaction of the
conditions (if any) subject to which this Transfer Certificate is
expressed to take effect.
Page 103
8 None of the Transferor, the Administrative Agent, the Security Agent, the
Book Runner or the Banks:
(i) makes any representation or warranty nor assumes any
responsibility with respect to the legality, validity,
effectiveness, adequacy or enforceability of the Agreement or any
of the Security Documents or any document relating thereto;
(ii) assumes any responsibility for the financial condition of the
Borrower or any other Security Party or any party to any such
other document or for the performance and observance by the
Borrower or any other Security Party or any party to any such
other document (save as otherwise expressly provided therein) and
any and all such conditions and warranties, whether express or
implied by law or otherwise, are hereby excluded (except as
aforesaid).
9 The Transferor and the Transferee each undertake that they will on demand
fully indemnify the Administrative Agent and the Security Agent in
respect of any claim, proceeding, liability or expense which relates to
or results from this Transfer Certificate or any matter concerned with or
arising out of it unless caused by the Administrative Agent's or Security
Agent's gross negligence or wilful misconduct, as the case may be.
10 The agreements and undertakings 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 Agreement and the Security Documents.
11 This Transfer Certificate shall be governed by, and construed in
accordance with, English law.
Page 104
Transferor Transferee
By: By:
Dated: Dated:
Agent
Agreed for and on behalf of itself as Administrative
Agent, the Borrower, the Security Agent, the Book
Runner, the Banks and all other parties to the Agency
Agreement
DEN NORSKE BANK ASA
By:
Dated:
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 Bank 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.
Page 105
The Schedule
Outstanding Contribution USD [o]
Undrawn Commitment ($) USD [o]
Portion Transferred [o]%
Administrative Details of Transferee
Name of Transferee:
Lending Office:
Contact Person
(Loan Administration Department):
Telephone:
Fax:
Contact Person
(Credit Administration Department):
Telephone:
Fax:
Account for payments:
Page 106
Schedule 6
Calculation of Additional Cost
1 The Additional Cost is an addition to the interest rate to compensate the
Banks for the cost of compliance with (a) the requirements of the Bank of
England and/or the Financial Services Authority (or, in either case, any
other authority which replaces all or any of its functions) or (b) the
requirements of the European Central Bank.
2 On the first day of each Interest Period (or as soon as possible
thereafter) the Administrative Agent shall calculate, as a percentage
rate, a rate (the "Additional Cost Rate") for each Bank, in accordance
with the paragraphs set out below. The Additional Cost will be calculated
by the Administrative Agent as a weighted average of the Banks'
Additional Cost Rates (weighted in proportion to the Commitments of each
Bank in the Loan) and will be expressed as a percentage rate per annum.
3 The Additional Cost Rate for any Bank lending from an office in a
Participating Member State will be the percentage notified by that Bank
to the Administrative Agent as the cost of complying with the minimum
reserve requirements of the European Central Bank.
4 The Additional Cost Rate for any Bank lending from an office in the
United Kingdom will be calculated by the Administrative Agent as follows:
(a) in relation to an amount in Sterling:
[OBJECT OMITTED]per cent. per annum
(b) in relation to an amount in any currency other than Sterling:
[OBJECT OMITTED]per cent. per annum.
Where:
A is the percentage of Eligible Liabilities (assuming these to be in
excess of any stated minimum) which that Bank is from time to time
required to maintain as an interest free cash ratio deposit with
the Bank of England to comply with cash ratio requirements.
B is the percentage rate of interest (excluding the Margin and the
Additional Cost) payable for the relevant Interest Period on the
Loan.
C is the percentage (if any) of Eligible Liabilities which that Bank
is required from time to time to maintain as interest bearing
Special Deposits with the Bank of England.
Page 107
D is the percentage rate per annum payable by the Bank of England to
the Administrative Agent on interest bearing Special Deposits.
E is the rate of charge payable by that Bank to the Financial
Services Authority pursuant to the Fees Regulations (but, for this
purpose, ignoring any minimum fee required pursuant to the Fees
Regulations) and expressed in pounds per (pound)1,000,000 of the
Fee Base of that Bank.
5 For the purposes of this schedule:
(a) "Eligible Liabilities" and "Special Deposits" have the meanings
given to them from time to time under or pursuant to the Bank of
England Act 1998 or (as may be appropriate) by the Bank of
England;
(b) "Fees Regulations" means the Banking Supervision (Fees)
Regulations 2001 or such other law or regulation as may be in
force from time to time in respect of the payment of fees for
banking supervision;
(c) "Fee Base" has the meaning given to it, and will be calculated in
accordance with, the Fees Regulations; and
(d) "Participating Member State" means any member state of the
European Communities that adopts or has adopted the euro as its
lawful currency in accordance with legislation of the European
Union relating to European Monetary Union.
6 In application of the above formulae, A, B, C and D will be included in
the formulae as percentages (i.e. 5 per cent. will be included in the
formula as 5 and not as 0.05). A negative result obtained by subtracting
D from B shall be taken as zero. The resulting figures shall be rounded
to four decimal places.
7 Each Bank shall supply any information required by the Administrative
Agent for the purpose of calculating its Additional Cost Rate. In
particular, but without limitation, each Bank shall supply the following
information in writing on or prior to the date on which it becomes a
Bank:
(a) its jurisdiction of incorporation and the jurisdiction of the
office through which it will perform its obligations under this
Agreement; and
(b) any other information that the Administrative Agent may reasonably
require for such purpose.
Each Bank shall promptly notify the Administrative Agent in writing of
any change to the information provided by it pursuant to this paragraph.
Page 108
8 The percentages or rates of charge of each Bank for the purpose of A, C
and E above shall be determined by the Administrative Agent based upon
the information supplied to it pursuant to paragraph 7 above and on the
assumption that, unless a Bank notifies the Administrative Agent to the
contrary, each Bank's obligations in relation to cash ratio deposits,
Special Deposits and the Fees Regulations are the same as those of a
typical bank from its jurisdiction of incorporation with an office in the
same jurisdiction as the office through which it is performing its
obligations under this Agreement.
9 The Administrative Agent shall have no liability to any person if such
determination results in an Additional Cost Rate which over or under
compensates any Bank and shall be entitled to assume that the information
provided by any Bank pursuant to paragraphs 3 and 7 above is true and
correct in all respects.
10 The Administrative Agent shall distribute the additional amounts received
as a result of the Additional Cost to the Lenders on the basis of the
Additional Cost Rate for each Bank based on the information provided by
each Bank pursuant to paragraphs 3 and 7 above.
11 Any determination by the Administrative Agent pursuant to this schedule
in relation to a formula, the Additional Cost, an Additional Cost Rate or
any amount payable to a Bank shall, in the absence of manifest error, be
conclusive and binding on all the parties to this Agreement.
12 The Administrative Agent may from time to time, after consultation with
the Borrower and the Banks, determine and notify to all the parties to
this Agreement any amendments which are required to be made to this
schedule in order to comply with any change in law, regulation or any
requirements from time to time imposed by the Bank of England, the
Financial Services Authority or the European Central Bank (or, in any
case, any other authority which replaces all or any of its functions) and
any such determination shall, in the absence of manifest error, be
conclusive and binding on all the parties to this Agreement.
Page 109
Schedule 7
Form of officer's certificate (referred to in clause 8.1(e)(ii)(D))
Officer's Certificate issued pursuant to a
USD325,000,000 Term Loan Agreement dated [o] 2001
I, [o], the Chief Financial Officer of Golar Gas Holding Company, Inc. (the
"Borrower"), hereby certify that:
1 Attached hereto are the latest [Annual Financial Statements][Quarterly
Financial Statements] for the [o] period ended on [o] (the "Reference
Date") for the Borrower. Such financial statements [were prepared in
accordance with GAAP] [were not prepared in accordance with GAAP and
attached hereto is a statement of the full details of the adjustments
required to such statements to reflect GAAP as necessary to calculate the
amounts referred to in paragraph 2 below].
2 Attached hereto is a statement of the respective amounts of:
o the Cash Balances[, the Cash Reserve] and Minimum Free Available
Cash
o Current Assets, Current Liabilities and the current portion of
Long Term Debt
o Annualised EBITDA and Interest Expense
o Net Debt,
as at, and for each relevant period ended on, the Reference Date.
3 The Borrower has complied with each of the financial undertakings set out
in clause 8.5 of the Loan Agreement and is not in default in the
performance or observance of any of such covenants [specify any
exceptions].
4 As at [date] no Default has occurred and is continuing [specify any
exceptions].
5 The person executing this certificate on our behalf has full information
concerning our financial affairs and has executed the same after having
made due investigation and enquiry as to the accuracy of the information
herein contained.
Page 110
Terms used herein and not otherwise defined herein shall have the meanings set
forth in the said Loan Agreement. This certificate is rendered pursuant to
clause 8.1(e)(ii)(D) of the Loan Agreement.
IN WITNESS WHEREOF, the undersigned has set his hand this [o] day of [o] [20o].
XXXXX GAS HOLDING COMPANY, INC.
By: ...................................................
Chief Financial Officer
Page 111
The Borrower
SIGNED by XXXXX XXXXXXXX )
for and on behalf of )
GOLAR GAS HOLDING COMPANY, INC. )
pursuant to a Power of Attorney ) XXXXX XXXXXXXX
dated 31 May 2001 ) Attorney-in-fact
Christiania Bank og Kreditkasse ASA
SIGNED by XXXXXX XXXXXXXX )
for and on behalf of )
CHRISTIANIA BANK OG KREDITKASSE ASA )
- Part of Nordea )
as the Administrative Agent, )
a Lead Arranger, a Swap Bank and as a Bank )
pursuant to a Power of Attorney ) XXXXXX XXXXXXXX
dated 30 May 2001 ) Attorney-in-fact
Den norske Bank ASA
SIGNED by XXXXXX XXXXXXXX )
for and on behalf of )
DEN NORSKE BANK ASA )
as the Security Agent, )
a Lead Arranger, a Swap Bank and as a Bank )
pursuant to a Power of Attorney ) XXXXXX XXXXXXXX
dated 30 May 2001 ) Attorney-in-fact
Citibank, N.A.
SIGNED by XXXXX XXXXX )
for and on behalf of )
CITIBANK, N.A. )
as the Book Runner, a Lead Arranger and as a Bank ) XXXXX XXXXX
by its authorised signatory ) Authorised signatory
Fortis Bank (Nederland) N.V.
SIGNED by XXXXXX XXXXXXXX )
for and on behalf of )
FORTIS BANK (NEDERLAND) N.V. )
as a Lead Arranger and as a Bank )
pursuant to a Power of Attorney ) XXXXXX XXXXXXXX
dated 30 May 2001 ) Attorney-in-fact
Page 112
