DATED 23 December 2004
---------------------
PISCES SHIPHOLDING LTD.
XXXXX XXXX NAVIGATION S.A.
SNAPPER MARINE LTD.
-and-
HSH NORDBANK AG
(as lender)
---------------------------------
US$27,000,000 SECURED
LOAN
FACILITY AGREEMENT
m.v. "XXXXX" (tbr "GOLDMAR")
m.v. "JEDI KNIGHT" (tbr "SWIFT")
m.v. "SEA WISE" (tbr "XXXXXXXXX")
---------------------------------
XXXXXXXXXX XXXXXXX
Xxx Xx. Xxxx'x Xxxxxxxxxx
Xxxxxx XX0X 0XX
Tel: 000 0000 0000
Fax: 000 0000 0000
Ref: 39.018
CONTENTS
Page
1 Definitions and Interpretation ..........................................2
2 The Loan and its Purpose ...............................................15
3 Conditions Precedent and Subsequent ....................................16
4 Representations and Warranties .........................................21
5 Repayment and Prepayment ...............................................23
6 Interest ...............................................................26
7 The Master Agreement ...................................................28
8 Fees ...................................................................30
9 Security Documents .....................................................31
10 Covenants ..............................................................31
11 Accounts................................................................39
12 Events Of Default ......................................................41
13 Set-Off and Lien .......................................................45
14 Assignment and Sub-Participation .......................................46
15 Payments, Mandatory Prepayment, Reserve Requirements and Illegality ....47
16 Communications .........................................................51
17 General Indemnities ....................................................52
18 Miscellaneous ..........................................................54
19 Law and Jurisdiction ...................................................59
Schedule 1 ..................................................................59
Calculation of the Mandatory Cost ......................................59
Appendix A ..................................................................63
Drawdown Notice ........................................................63
LOAN AGREEMENT
Dated: 23 December 2004
BETWEEN:-
(1) PISCES SHIPHOLDING LTD., ("Pisces"), XXXXX XXXX NAVIGATION S.A. ("Liegh")
and SNAPPER MARINE LTD. ("Snapper") each of which is a corporation
incorporated according to the laws of the Republic of Liberia, and whose
registered office is at 00 Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx (together "the
Borrowers" and each a "Borrower"); and
(2) HSH NORDBANK AG, a company incorporated under the laws of the Federal
Republic of Germany and having its registered office at
Xxxxxxx-Xxxxxxxxx-Xxxxx 00, 00000 Xxxxxxx, Xxxxxxx ("the Bank").
WHEREAS:
(A) Pisces has agreed to purchase the Xxxxx Vessel from the Xxxxx Seller
pursuant to the Xxxxx MOA for a purchase price of eleven million nine
hundred and twenty thousand Dollars ($11,920,000) and intends to register
the Xxxxx Vessel in its ownership under the flag of the Republic of Panama.
(B) Liegh has agreed to purchase the Jedi Knight Vessel from the Jedi Knight
Seller pursuant to the Jedi Knight MOA for a purchase price of eleven
million eight hundred and fifty thousand Dollars ($11,850,000) and intends
to register the Jedi Knight Vessel in its ownership under the flag of the
Republic of Panama.
(C) Snapper has agreed to purchase the Sea Wise Vessel from the Sea Wise Seller
pursuant to the Sea Wise MOA for a purchase price of seventeen million six
hundred eighty thousand Dollars ($17,680,000) and intends to register the
Sea Wise Vessel in its ownership under the flag of the Republic of Panama.
(D) The Bank has agreed to advance to the Borrowers, as joint and several
debtors and obligors, an aggregate amount not exceeding the lower of (a)
twenty seven million Dollars ($27,000,000) and (b) seventy per centum (70%)
of the aggregate Market Value of all the Vessels in up to three Drawings,
one in respect of each Vessel, in order to assist the Borrowers in
financing part of the acquisition of the Vessels.
IT IS AGREED as follows:
1 Definitions and Interpretation
1.1 Definitions
In this Agreement:-
1.1.1 "the Accounts" means the Earnings Accounts and the
Retention Account.
1.1.2 "the Accounts Security Deeds" means the Accounts
Security Deeds referred to in Clause 9.4.
1.1.3 "the Address for Service" means Xxxxxxx & Co., Princes
House, 00 Xxxxxxx Xxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx or,
in relation to any of the Security Parties, such other
address in England and Wales as that Security Party may
from time to time designate by no fewer than ten days'
written notice to the Bank.
1.1.4 "the Administration" has the meaning given to it in
paragraph 1.1.3 of the ISM Code.
1.1.5 the "Advance Date" means the date on which any part of
the Loan is advanced by the Bank to the Borrowers
pursuant to Clause 2.
1.1.6 "Agreed Rate" means the rate including the Margin agreed
by the Bank with the Borrowers from time to time, in the
case of an interest period in excess of 12 months, and
in an aggregate amount not exceeding twelve point five
per centum (12.5%) per annum.
1.1.7 "Approved Broker" means a firm of independent first
class sale and purchase shipbrokers appointed by, and
reporting to, the Bank.
1.1.8 "the Assignments" means the deeds of assignment of the
Insurances, Earnings, Charter Rights and Requisition
Compensation referred to in Clause 9.2 (each an
"Assignment").
1.1.9 "Attributable Indebtedness" means, in the case of the
Xxxxx Vessel, the Indebtedness in respect of the Xxxxx
Drawing and, in the case of the Jedi Knight Vessel the
Indebtedness in respect of the Jedi Knight Drawing, and,
in the case of the Sea Wise Vessel, the Indebtedness in
respect of the Sea Wise Drawing.
1.1.10 "the Availability Termination Date" means 30 March 2005
or such later date as the Bank may in its discretion
agree.
1.1.11 "Break Costs" means all costs, losses, premiums or
penalties incurred by the Bank in the circumstances
contemplated by Clause 17.4, or as a result of it
receiving any prepayment of all or any part of the Loan
(whether pursuant to Clause 5 or otherwise), or any
other payment under or in relation to the Security
Documents on a day other than the due date for payment
of the sum in question, and includes (without
limitation) any losses or costs incurred in liquidating
or re-employing deposits from third parties acquired to
effect or maintain the Loan, and any liabilities,
expenses or losses incurred by the Bank in terminating
or reversing, or otherwise in connection with, any
Transaction or any other interest rate and/or currency
swap, transaction or arrangement entered into by the
Bank to hedge any exposure arising under this Agreement,
or in terminating or reversing, or otherwise in
connection with, any open position arising under this
Agreement or the Master Agreement.
1.1.12 "Business Day" means a day on which banks are open for
the transaction of business of the nature contemplated
by this Agreement (and not authorised by law to close)
in Xxx Xxxx, Xxxxxx Xxxxxx xx Xxxxxxx; Xxxxxx, Xxxxxxx;
Hamburg, Federal Republic of Germany; and any other
financial centre which the Bank may consider appropriate
for the operation of the provisions of this Agreement.
1.1.13 "Cash Reserves" means freely available cash, or other
reserves acceptable to the Bank (and which shall include
amounts held by the Bank in respect of any amounts
maintained by the Borrowers under Clause 10.2.7), and
which are free of Encumbrances, in a minimum aggregate
amount of twelve million Dollars ($12,000,000).
1.1.14 "Charter", in respect of a Vessel, means any
charterparty or other contract of employment for that
Vessel which will be in force for a period, in
aggregate, of eleven months or more or which will have
at least eleven months of its term remaining during the
Facility Period.
1.1.15 "Charterer", in respect of any Charter, means a
charterer or other person acceptable to the Bank in its
discretion.
1.1.16 "Charter Rights", in respect of a Vessel, means all
rights and benefits accruing to the Owner of that Vessel
under or arising out of the relevant Charter and not
forming part of the Earnings.
1.1.17 "Commitment Commission" means the commitment commission
to be paid by the Borrowers to the Bank pursuant to
Clause 8.2.
1.1.18 a "Communication" means any notice, approval, demand,
request or other communication from one party to this
Agreement to any other party to this Agreement.
1.1.19 "the Communications Address" means c/o Maryville Maritime
Inc., 67 Xxxx Xxxxxxx, 000 00 Xxxxxxx (fax no: 000 0000
636) marked for the attention of Xx. Xxxxxxxx X.
Xxxxxxx.
1.1.20 "the Company" means, at any given time and in relation
to any Vessel, the company responsible for that Vessel's
compliance with the ISM Code pursuant to paragraph 1.1.2
of the ISM Code.
1.1.21 a "Confirmation" means a Confirmation exchanged, or
deemed exchanged, between the Bank and the Borrowers as
contemplated by the Master Agreement.
1.1.22 "Credit Support Document" means any document described
as such in the Master Agreement and, where the context
permits, any other document referred to in any Credit
Support Document which has the effect of creating an
Encumbrance in favour of the Bank.
1.1.23 "Credit Support Provider" means any person (other than
any of the Borrowers) described as such in the Master
Agreement.
1.1.24 "Currency of Account" means, in relation to any payment
to be made to the Bank under or pursuant to any of the
Security Documents, the currency in which that payment
is required to be made by the terms of the relevant
Security Document.
1.1.25 "Default Rate" means the aggregate of the Margin and the
rate of two per centum (2%) per annum above the cost to
the Bank of obtaining funds in amount similar to the
amount of the Indebtedness or any relevant part of the
Indebtedness for such periods as the Bank shall
determine in its discretion.
1.1.26 "DOC" means, in relation to each Company, a valid
Document of Compliance issued for that Company by the
Administration pursuant to paragraph 13.2 of the ISM
Code.
1.1.27 "Dollars" and "$" each means available and freely
transferable and convertible funds in lawful currency of
the United States of America.
1.1.28 "Drawdown Notice" means a notice complying with Clause
2.2.
1.1.29 "Drawing" means a part of the Loan advanced by the Bank
to the Borrowers in accordance with Clause 2.2.
1.1.30 "Earnings", in relation to a Vessel, means all hires,
freights, pool income and other sums payable to or for
the account of the Owner in respect of that Vessel
including (without limitation) all remuneration for
salvage and towage services, demurrage and detention
moneys, contributions in general average, compensation
in respect of any requisition for hire and damages and
other payments (whether awarded by any court or arbitral
tribunal or by agreement or otherwise) for breach,
termination or variation of any contract for the
operation, employment or use of the Vessel.
1.1.31 "the Earnings Accounts" means the bank accounts to be
opened, one in the name of each Borrower, with the Bank
and designated "[name of Borrower] - Earnings Account".
1.1.32 "Encumbrance" means any mortgage, charge (fixed or
floating), pledge, lien, assignment, hypothecation,
preferential right, option, title retention or trust
arrangement or any other agreement or arrangement which
has the effect of creating security or payment priority.
1.1.33 "Event of Default" means any of the events set out in
Clause 12.2.
1.1.34 "the Facility Period" means the period beginning on the
date of this Agreement and ending on the date when the
whole of the Indebtedness has been repaid in full and
the Borrowers have ceased to be under any further actual
or contingent liability to the Bank under or in
connection with the Security Documents.
1.1.35 "Drawing" means a part of the Loan advanced by the Bank
to the Borrowers in accordance with Clause 2.2.
1.1.36 "the Guarantee" means the guarantee and indemnity of the
Guarantor referred to in Clause 9.3.
1.1.37 "the Guarantor" means Excel Maritime Carriers Ltd.
and/or (where the context permits) any other person or
company who shall at any time during the Facility Period
give to the Bank a guarantee and/or indemnity for the
repayment of all or part of the Indebtedness.
1.1.38 a "Hedging Transaction" means a Transaction entered into
between the Bank and the Borrowers pursuant to the
Master Agreement for the express purpose of hedging all
or part of the Borrowers' interest rate risk pursuant to
this Agreement.
1.1.39 "the Indebtedness" means the Loan; any Master Agreement
Liabilities; all other sums of any nature (together with
all interest on any of those sums) which from time to
time may be payable by any of the Borrowers to the Bank
pursuant to the Security Documents; any damages payable
as a result of any breach by any of the Borrowers of any
of the Security Documents; and any damages or other sums
payable as a result of any of the obligations of any of
the Borrowers under or pursuant to any of the Security
Documents being disclaimed by a liquidator or any other
person, or, where the context permits, the amount
thereof for the time being outstanding.
1.1.40 "Insurances", in relation to a Vessel, means all
policies and contracts of insurance (including all
entries in protection and indemnity or war risks
associations) which are from time to time taken out or
entered into in respect of or in connection with that
Vessel or her increased value or her Earnings and (where
the context permits) all benefits thereof, including all
claims of any nature and returns of premium.
1.1.41 "Interest Payment Date" means each date for the payment
of interest in accordance with Clause 6.
1.1.42 "Interest Period" means each interest period selected by
the Borrowers or agreed by the Bank pursuant to Clause
6.
1.1.43 "the ISM Code" means the International Management Code
for the Safe Management of Ships and for Pollution
Prevention, as adopted by the Assembly of the
International Maritime Organisation on 4 November 1993
by resolution A.74I (18) and incorporated on 19 May 1994
as chapter IX of the Safety of Life at Sea Convention
1974.
1.1.44 "ISPS Code" means the International Ship and Port
Facility Security Code adopted by the International
Maritime Organisation (as the same may be amended from
time to time).
1.1.45 "Jedi Knight MOA", means the memorandum of agreement
dated 22 October 2004 (as the same may be supplemented,
and/or amended from time to time) on the terms and
subject to the conditions of which the Jedi Knight
Seller has agreed to sell the Jedi Knight Vessel to
Liegh.
1.1.46 "Jedi Knight Seller" means Jedi Knight Enterprises
Limited, a company incorporated according to the law of
the Republic of Malta with its registered office at [ ],
Valletta, Malta.
1.1.47 "Jedi Knight Vessel" means the 1984 built 37,687 dwt
handymax bulk carrier currently registered under the
flag of the Republic of Malta in the ownership of the
Seller with the name "JEDI KNIGHT" and intended to be
sold by the Seller to Liegh pursuant to the Jedi Knight
MOA and registered under the flag of the Republic of
Panama in the ownership of Liegh with the name "SWIFT".
1.1.48 "law" means any law, statute, treaty, convention,
regulation, instrument or other subordinate legislation
or other legislative or quasi-legislative rule or
measure, or any order or decree of any government,
judicial or public or other body or authority, or any
directive, code of practice, circular, guidance note or
other direction issued by any competent authority or
agency (whether or not having the force of law).
1.1.49 "LIBOR" means the rate, rounded to the nearest four
decimal places downwards (if the digit displayed in the
fifth decimal place is 1,2,3 or 4) or upwards (if the
digit displayed in the fifth decimal place is 5,6,7,8 or
9) displayed as the British Bankers' Association
Interest Settlement Rate on any information service
selected by the Bank on which that rate is displayed,
for deposits in Dollars of amounts equal to the amount
of the Loan or any relevant part of the Loan for a
period equal in length to the relevant Interest Period,
or (if the Bank is for any reason unable to ascertain
that rate) the rate (rounded upwards to the nearest
whole multiple of one-sixteenth of one per centum) at
which deposits in Dollars of amounts comparable to the
amount of the Loan (or any relevant part of the Loan)
are offered to the Bank in the London Interbank market
for a period equal in length to the relevant Interest
Period.
1.1.50 "the Loan" means the aggregate amount from time to time
advanced by the Bank to the Borrowers pursuant to Clause
2 or, where the context permits, the amount advanced and
for the time being outstanding.
1.1.51 "the Managers" means Maryville Maritime Inc., a company
incorporated according to the law of the Republic of
Liberia with its registered office at 00 Xxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx, or such other commercial and/or
technical managers of the Vessels nominated by the
Borrowers as the Bank may in its discretion approve.
1.1.52 "Mandatory Cost" means the cost imputed to the Bank of
compliance with the mandatory liquid asset requirements
of the Bank of England and/or the banking supervision or
other costs imposed by the Financial Services Authority,
determined in accordance with Schedule 1.
1.1.53 "the Margin" means one point eighty five per centum
(1.85%) per annum
1.1.54 "Xxxxx MOA" means the memorandum of agreement dated 4
November 2004 (as the same may be supplemented, and/or
amended from time to time) on the terms and subject to
the conditions of which the Xxxxx Seller has agreed to
sell the Xxxxx Vessel to Pisces.
1.1.55 "Xxxxx Seller" means Agile Holdings Corp, a company
incorporated according to the law of the Republic of
Liberia with its registered office at 00 Xxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx.
1.1.56 "Xxxxx Vessel" means the 1984 built 39,695 dwt handymax
bulk carrier currently registered under the flag of the
Hellenic Republic in the ownership of the Seller with
the name "XXXXX" and intended to be sold by the Seller
to Pisces pursuant to the Xxxxx MOA and registered under
the flag of the Republic of Panama in the ownership of
Pisces with the name "GOLDMAR".
1.1.57 "Market Value", in respect of each Vessel, means the
market value of that Vessel determined in accordance
with Clause 3.2.7.
1.1.58 "Master Agreement" means any ISDA Master Agreement (or
any other form of master agreement relating to interest
or currency exchange transactions) entered into between
the Bank and the Borrowers during the Facility Period,
including each Schedule to any Master Agreement and each
Confirmation exchanged pursuant to any Master Agreement.
1.1.59 "the Master Agreement Liabilities" means, at any
relevant time, all liabilities of the Borrowers to the
Bank under or pursuant to the Master Agreement, whether
actual or contingent, present or future.
1.1.60 "Maximum Drawing Amount":-
(a) in respect of the Drawing for the Jedi Knight Vessel
means the lower of (i) seven million seven hundred
and fifty thousand Dollars ($7,750,000) and (ii)
seventy per centum (70%) of the Market Value of the
Jedi Knight Vessel;
(b) in respect of the Drawing for the Xxxxx Vessel means
the lower of (i) seven million seven hundred and
fifty thousand Dollars ($7,750,000) and (ii) seventy
per centum (70%) of the Market Value of the Xxxxx
Vessel;
(c) in respect of the Drawing for the Sea Wise Vessel
means the lower of (i) eleven million five hundred
thousand Dollars ($11,500,000) and (ii) seventy per
centum (70%) of the Market Value of the Sea Wise
Vessel;
1.1.61 "the Maximum Loan Amount" means the lower of (a) twenty
seven million Dollars ($27,000,000) and (b) seventy per
centum (70%) of the aggregate Market Value of all the
Vessels.
1.1.62 "the Mortgagees' Insurances" means all policies and
contracts of mortgagees' interest insurance, mortgagees'
additional perils (oil pollution) insurance and any
other insurance from time to time taken out by the Bank
in relation to the Vessels.
1.1.63 "the Mortgages" means the first preferred mortgages
referred to in Clause 9.1 (each a "Mortgage").
1.1.64 "Net Income" means the aggregate profit after tax of the
Guarantor calculated in accordance with the accounting
information for the Guarantor then most recently
required to be delivered pursuant to Clause 9 of the
Guarantee.
1.1.65 "Notional Amount", in respect of any Hedging
Transaction, means the Notional Amount as defined in the
Confirmation relating to that Hedging Transaction.
1.1.66 "Owner", in relation to Xxxxx Vessel, means Pisces and,
in relation to the Jedi Knight Vessel, means Liegh and,
in relation to the Sea Wise Vessel, means Snapper.
1.1.67 "Potential Event of Default" means any event which, with
the giving of notice and/or the passage of time and/or
the satisfaction of any materiality test, would
constitute an Event of Default.
1.1.68 "Proceedings" means any suit, action or proceedings
begun by the Bank arising out of or in connection with
the Security Documents.
1.1.69 "Repayment Date" means the date for payment of any
Repayment Instalment in accordance with Clause 5.
1.1.70 "Repayment Instalment" means any instalment of the Loan
to be repaid by the Borrowers pursuant to Clause 5.
1.1.71 "Requisition Compensation", in relation to a Vessel,
means all compensation or other money which may from
time to time be payable to the Owner as a result of the
Vessel being requisitioned for title or in any other way
compulsorily acquired (other than by way of requisition
for hire).
1.1.72 "the Retention Account" means a bank account to be
opened in the joint names of the Borrowers with the Bank
and designated "[name of Borrowers] - Retention
Account".
1.1.73 "Sea Wise MOA", means the memorandum of agreement dated
9 December 2004 (as the same may be supplemented, and/or
amended from time to time) on the terms and subject to
the conditions of which the Sea Wise Seller has agreed
to sell the Sea Wise Vessel to Snapper.
1.1.74 "Sea Wise Seller" means Xxxxx Properties Inc., a company
incorporated according to the law of the Republic of
Liberia with its registered office at 00 Xxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx.
1.1.75 "Sea Wise Vessel" means the 1987 built 24,536 dwt bulk
carrier currently registered under the flag of the St.
Xxxxxxx & The Grenadines in the ownership of the Sea
Wise Seller with the name "SEA WISE" and intended to be
sold by the Sea Wise Seller to Snapper pursuant to the
Sea Wise MOA and registered under the flag of the
Republic of Panama in the ownership of Snapper with the
name "XXXXXXXXX".
1.1.76 "the Security Documents" means this Agreement, the
Mortgages, the Assignments, the Guarantee, the Accounts
Security Deeds, the Master Agreement and any other
Credit Support Documents or (where the context permits)
any one or more of them, and any other agreement or
document which may at any time be executed by any person
as security for the payment of all or any part of the
Indebtedness.
1.1.77 "Security Parties" means the Borrowers, the Guarantor,
any other Credit Support Providers, and any other person
or company who may at any time during the Facility
Period be liable for, or provide security for, all or
any part of the Indebtedness, and "Security Party" means
any one of them.
1.1.78 "SMC" means, in relation to each Vessel, a valid safety
management certificate issued for that Vessel by or on
behalf of the relevant Administration pursuant to
paragraph 13.4 of the ISM Code.
1.1.79 "SMS" means, in relation to each Vessel, a safety
management system for that Vessel developed and
implemented in accordance with the ISM Code and
including the functional requirements, duties and
obligations required by the ISM Code.
1.1.80 "Taxes" means all taxes, levies, imposts, duties,
charges, fees, deductions and withholdings (including
any related interest, fines, surcharges and penalties)
and any restrictions or conditions resulting in any
charge, other than taxes on the overall net income of
the Bank, and "Tax" and "Taxation" shall be interpreted
accordingly.
1.1.81 "Total Loss", in relation to a Vessel, means:-
(a) an actual, constructive, arranged, agreed or
compromised total loss of that Vessel; or
(b) the requisition for title or compulsory acquisition
of that Vessel by or on behalf of any government or
other authority (other than by way of requisition
for hire); or
(c) the capture, seizure, arrest, detention or
confiscation of that Vessel, unless the Vessel is
released and returned to the possession of the Owner
within one month after the capture, seizure, arrest,
detention or confiscation in question.
1.1.82 "Transaction" means a transaction entered into between
the Bank and the Borrowers governed by the Master
Agreement.
1.1.83 "Value", in respect of a Vessel, means a value for that
Vessel determined by means of a valuation of that Vessel
made in accordance with Clause 10.2.4.
1.1.84 "the Vessels" means the Xxxxx Vessel, the Jedi Knight
Vessel and the Sea Wise Vessel (each a "Vessel").
1.2 Interpretation
In this Agreement:-
1.2.1 words denoting the plural number include the singular
and vice versa;
1.2.2 words denoting persons include corporations,
partnerships, associations of persons (whether
incorporated or not) or governmental or
quasi-governmental bodies or authorities and vice versa;
1.2.3 references to Recitals, Clauses, Schedules and
Appendices are references to recitals and clauses of,
and schedules and appendices to, this Agreement;
1.2.4 references to this Agreement include the Recitals, the
Schedules and the Appendices;
1.2.5 the headings and contents page(s) are for the purpose of
reference only, have no legal or other significance, and
shall be ignored in the interpretation of this
Agreement;
1.2.6 references to any document (including, without
limitation, to all or any of the Security Documents)
are, unless the context otherwise requires, references
to that document as amended, supplemented, novated or
replaced from time to time;
1.2.7 references to statutes or provisions of statutes are
references to those statutes, or those provisions, as
from time to time amended, replaced or re-enacted;
1.2.8 words and expressions defined in the Master Agreement,
unless the context otherwise requires, have the same
meaning;
1.2.9 references to the Bank include its successors,
transferees and assignees;
1.2.10 references to times of day are to London time.
1.3 Offer letter
This Agreement supersedes the terms and conditions contained in
any correspondence relating to the subject matter of this
Agreement exchanged between the Bank and the Borrowers or their
representatives prior to the date of this Agreement.
1.4 Joint and several liability
1.4.1 All obligations, covenants, representations, warranties
and undertakings in or pursuant to the Security
Documents assumed, given, made or entered into by the
Borrowers shall, unless otherwise expressly provided, be
assumed, given, made or entered into by the Borrowers
jointly and severally.
1.4.2 Each of the Borrowers agrees that any rights which it
may have at any time during the Facility Period by
reason of the performance of its obligations under the
Security Documents to be indemnified by any other
Borrower and/or to take the benefit of any security
taken by the Bank pursuant to the Security Documents
shall be exercised in such manner and on such terms as
the Bank may require. Each of the Borrowers agrees to
hold any sums received by it as a result of its having
exercised any such right on trust for the Bank
absolutely.
1.4.3 Each of the Borrowers agrees that it will not at any
time during the Facility Period claim any set-off or
counterclaim against any other Borrower in respect of
any liability owed to it by that other Borrower under or
in connection with the Security Documents, nor prove in
competition with the Bank in any liquidation of (or
analogous proceeding in respect of) any other Borrower
in respect of any payment made under the Security
Documents or in respect of any sum which includes the
proceeds of realisation of any security held by the Bank
for the repayment of the Indebtedness.
2 The Loan and its Purpose
2.1 Agreement to lend Subject to the terms and conditions of this
Agreement, and in reliance on each of the representations and
warranties made or to be made in or in accordance with each of
the Security Documents, the Bank agrees to advance to the
Borrowers an aggregate amount not exceeding the Maximum Loan
Amount to be used by the Borrowers for the purposes referred to
in Recital (D).
2.2 Advance of the Loan Subject to satisfaction by the Borrowers of
the conditions set out in Clause 3.1, and subject to Clause 2.3,
the Loan shall be advanced to the Borrowers in three Drawings,
one in respect of each Vessel, by such method of funds transfer
as the Bank and the Borrowers shall agree. Each Drawing shall be
advanced in Dollars on a Business Day, provided that the
Borrowers shall have given to the Bank not more than ten and not
fewer than three Business Days' notice in writing materially in
the form set out in Appendix A of the required Advance Date. The
Drawdown Notice once given shall be irrevocable and shall
constitute a warranty by the Borrowers that:-
2.2.1 all conditions precedent to the advance of the Drawing
requested in that Drawdown Notice will have been
satisfied on or before the Advance Date requested;
2.2.2 no Event of Default or Potential Event of Default will
then have occurred;
2.2.3 no Event of Default or Potential Event of Default will
result from the advance of the Drawing in question; and
2.2.4 there has been no material adverse change in the
business, affairs or financial condition of any of the
Security Parties from that pertaining at the date of
this Agreement.
2.3 Availability Termination Date The Bank shall be under no
obligation to advance all or any part of the Loan after the
Availability Termination Date.
2.4 Application of Loan Without prejudice to the obligations of the
Borrowers under this Agreement, the Bank shall not be obliged to
concern itself with the application of the Loan by the
Borrowers.
2.5 Loan and control accounts The Borrowers will open and maintain
with the Bank such loan and control accounts as the Bank shall
in its discretion consider necessary or desirable.
3 Conditions Precedent and Subsequent
3.1 Conditions Precedent - initial Before the Bank shall have any
obligation to advance any part of the Loan, the Borrowers shall
deliver or cause to be delivered to or to the order of the Bank
the following documents and evidence:-
3.1.1 Evidence of incorporation Such evidence as the Bank may
reasonably require that each Security Party was duly
incorporated in its country of incorporation and remains
in existence and, where appropriate, in good standing,
with power to enter into, and perform its obligations
under, those of the Security Documents to which it is,
or is intended to be, a party, including (without
limitation) a copy, certified by a director or the
secretary of the Security Party in question as true,
complete, accurate and unamended, of all documents
establishing or limiting the constitution of each
Security Party.
3.1.2 Corporate authorities A copy, certified by a director or
the secretary of the Security Party in question as true,
complete, accurate and neither amended nor revoked, of a
resolution of the directors and a resolution of the
shareholders of each Security Party (together, where
appropriate, with signed waivers of notice of any
directors' or shareholders' meetings) approving, and
authorising or ratifying the execution of, those of the
Security Documents to which that Security Party is or is
intended to be a party and all matters incidental
thereto.
3.1.3 Officer's certificate A certificate signed by a duly
authorised officer of each of the Security Parties
setting out the names of the directors, officers and
shareholders of that Security Party.
3.1.4 Power of attorney The notarially attested and legalised
power of attorney of each of the Security Parties under
which any documents are to be executed or transactions
undertaken by that Security Party.
3.1.5 Process agent A letter from Xxxxxxx & Co. accepting
their appointment by each of the Security Parties as
agent for service of Proceedings pursuant to the
Security Documents.
3.1.6 Mandates Such duly signed forms of mandate, and/or other
evidence of opening of the Accounts, as the Bank may
require.
3.1.7 Security Documents The Loan Agreement, the Guarantee,
the Accounts Security Deeds, the Master Agreement and
any other credit support documents, together with all
notices and other documents required by any of them,
duly executed.
3.1.8 Shareholding Evidence, in form and substance
satisfactory to the Bank, that the Guarantor legally and
beneficially holds one hundred per centum (100%) of the
shares in each Borrower.
3.1.9 Legal opinions Confirmation satisfactory to the Bank
that all legal opinions required by the Bank will be
given substantially in the form required by the Bank.
3.2 Conditions precedent-- each Drawing Before the Bank shall have
any obligation to advance any part of a Drawing, the Borrowers
shall deliver or cause to be delivered to or to the order of the
Bank the following documents and evidence:-
3.2.1 Vessel documents Photocopies, certified as true,
accurate and complete by a director or the secretary of
the Owner, of (in respect of the Vessel to which the
Drawing in question relates):-
(a) that Vessel's MOA (inter alia) evidencing that
Vessel's purchase price;
(b) that Vessel's, the xxxx of sale transferring title
in that Vessel to its Owner free of all
encumbrances, maritime liens and other debts;
(c) that Vessel's, the protocol of delivery and
acceptance evidencing the unconditional physical
delivery of that Vessel by its Seller to its Owner
pursuant to its MOA;
(d) any charterparty or other contract of employment of
that Vessel which will be in forte on the Advance
Date for that Drawing;
(e) the management agreement between the relevant Owner
and the Managers relating to that Vessel;
(f) that Vessel's current International Tonnage, Load
Line, Safety Construction, Safety Equipment, Safety
Radio and Oil Pollution Prevention Certificates;
(g) that Vessel's current Certificate of Financial
Responsibility issued pursuant to the United States
Oil Pollution Xxx 0000;
(h) that Vessel's current ISSC;
(i) that Vessel's current SMC; and
(j) the relevant Company's current DOC;
in each case together with all addenda, amendments or
supplements.
3.2.2 Evidence of ownership In respect of the Vessel to which
the Drawing in question relates, certificate(s) of
ownership and encumbrance (or equivalent) issued by the
Registrar of Ships (or equivalent official) at the
Vessel's port of registry confirming that the Vessel is
on the relevant Advance Date owned by her Owner and free
of registered Encumbrances.
3.2.3 Evidence of insurance In respect of the Vessel to which
the Drawing in question relates, evidence that the
Vessel is insured in the manner required by the relevant
Security Documents and that letters of undertaking will
be issued in the manner required by the Security
Documents, together with (if required by the Bank and at
the expense of the Borrowers) the written approval of
the Insurances for that Vessel by an insurance adviser
appointed by the Bank.
3.2.4 Confirmation of class In respect of the Vessel to which
the Drawing in question relates, a Certificate of
Confirmation of Class for hull and machinery confirming
that the Vessel is classed with the highest class
applicable to vessels of her type with Lloyd's Register
of Shipping or such other classification society as may
be acceptable to the Bank.
3.2.5 Instruction to classification society In respect of the
Vessel to which the Drawing in question relates, a
letter of instruction from the Owner of that Vessel to
that Vessel's classification society in the form
required by the Bank, duly acknowledged by the
classification society.
3.2.6 Valuations In respect of the Vessel to which the Drawing
in question relates, a valuation of that Vessel
addressed to the Bank, at the expense of the Borrowers,
from an Approved Broker certifying a Market Value for
that Vessel, assessed in such manner as the Bank may
require, acceptable to the Bank.
3.2.7 The Security Documents The Mortgage, and Assignment for
that Vessel, together with all notices and other
documents required by any of them, duly executed and, in
the case of the Mortgage, registered with first priority
through the Registrar of Ships (or equivalent official)
at the port of registry of the Vessel concerned.
3.2.8 Drawdown Notice A Drawdown Notice substantially in the
form of Appendix A.
3.2.9 Managers' confirmation In respect of the Vessel to which
the Drawing in question relates, the written
confirmation of the Managers that, throughout the
Facility Period unless otherwise agreed by the Bank,
they will remain the commercial and technical managers
of that Vessel and that they will not, without the prior
written consent of the Bank, sub-contract or delegate
the commercial or technical management of that Vessel to
any third party.
3.2.10 Legal opinions Confirmation satisfactory to the Bank
that all legal opinions required by the Bank will be
given substantially in the form required by the Bank.
3.3 Conditions Subsequent The Borrowers undertake to deliver or to
cause to be delivered to the Bank on, or as soon as practicable
after, the Advance Date for the Drawing in question, the
following additional documents and evidence:-
3.3.1 Evidence of registration Evidence of registration of the
Mortgage for the Vessel in question, in each case with
first priority, with the Registrar of Ships (or
equivalent official) at the port of registry of the
Vessel concerned.
3.3.2 Letters of undertaking Letters of undertaking as
required by the relevant Security Documents in form and
substance acceptable to the Bank.
3.3.3 Legal opinions Such legal opinions as the Bank shall
require.
3.3.4 Master's receipts The master's receipt for each of the
Mortgages.
3.4 No waiver If the Bank in its sole discretion agrees to advance
any part of the Loan to the Borrowers before all of the
documents and evidence required by Clause 3.1 and the relevant
documents and evidence required by Clauses 3.2 and/or 3.3 have
been delivered to or to the order of the Bank, the Borrowers
undertake to deliver all outstanding documents and evidence to
or to the order of the Bank no later than the date specified by
the Bank, and the Bank's advance of any part of the Loan shall
not be taken as a waiver of its right to require production of
all the documents and evidence required by Clauses 3.1 and/or
3.2 and/or 3.3.
3.5 Form and content All documents and evidence delivered to the
Bank pursuant to this Clause shall:-
3.5.1 be in form and substance acceptable to the Bank;
3.5.2 be accompanied, if required by the Bank, by translations
into the English language, certified in a manner
acceptable to the Bank;
3.5.3 if required by the Bank, be certified, notarised,
legalised or attested in a manner acceptable to the
Bank.
3.6 Event of Default The Bank shall be under no obligation to
advance any part of the Loan nor to act on any Drawdown Notice
if, at the date of the Drawdown Notice or at the date on which
the advance of the Loan is requested in the Drawdown Notice, an
Event of Default or Potential Event of Default shall have
occurred, or if an Event of Default or Potential Event of
Default would result from the advance of the Loan.
4 Representations and Warranties
Each of the Borrowers represents and warrants to the Bank at the date of
this Agreement and (by reference to the facts and circumstances then
pertaining) at the date of each Drawdown Notice, at each Advance Date
and at each Interest Payment Date as follows:-
4.1 Incorporation and capacity Each of the Security Parties is a
body corporate duly constituted and existing and (where
applicable) in good standing under the law of its country of
incorporation, in each case with perpetual corporate existence
and the power to xxx and be sued, to own its assets and to carry
on its business, and all of the corporate shareholders (if any)
of each Security Party are duly constituted and existing under
the laws of their countries of incorporation with perpetual
corporate existence and the power to xxx and be sued, to own
their assets and to carry on their business.
4.2 Solvency None of the Security Parties is insolvent or in
liquidation or administration or subject to any other insolvency
procedure, and no receiver, administrative receiver,
administrator, liquidator, trustee or analogous officer has been
appointed in respect of any of the Security Parties or all or
any part of their assets.
4.3 Binding obligations The Security Documents when duly executed
and delivered will constitute the legal, valid and binding
obligations of the Security Parties enforceable in accordance
with their respective terms.
4.4 Satisfaction of conditions All acts, conditions and things
required to be done and satisfied and to have happened prior to
the execution and delivery of the Security Documents in order to
constitute the Security Documents the legal, valid and binding
obligations of the Security Parties in accordance with their
respective terms have been done, satisfied and have happened in
compliance with all applicable laws.
4.5 Registrations and consents With the exception only of the
registrations referred to in Clause 3.3, all (if any) consents,
licences, approvals and authorisations of, or registrations with
or declarations to, any governmental authority, bureau or agency
which may be required in connection with the execution,
delivery, performance, validity or enforceability of the
Security Documents have been obtained or made and remain in full
force and effect and none of the Borrowers is aware of any event
or circumstance which could reasonably be expected adversely to
affect the right of any of the Borrowers to hold and/or obtain
renewal of any such consents, licences, approvals or
authorisations.
4.6 Disclosure of material facts None of the Borrowers is aware of
any material facts or circumstances which have not been
disclosed to the Bank and which might, if disclosed, have
adversely affected the decision of a person considering whether
or not to make loan facilities of the nature contemplated by
this Agreement available to the Borrowers.
4.7 No material litigation There is no action, suit, arbitration or
administrative proceeding pending or to its knowledge about to
be pursued before any court, tribunal or governmental or other
authority which would, or would be likely to, have a materially
adverse effect on the business, assets, financial condition or
creditworthiness of any of the Security Parties.
4.8 No breach of law or contract The execution, delivery and
performance of the Security Documents will not contravene any
contractual restriction or any law binding on any of the
Security Parties or on any shareholder (whether legal or
beneficial) of any of the Security Parties, or the
constitutional documents of any of the Security Parties, nor
result in the creation of, nor oblige any of the Security
Parties to create, any Encumbrance over all or any of its
assets, with the exception of the Encumbrances created by or
pursuant to the Security Documents, and, in entering into those
of the Security Documents to which it is, or is to be, a xxxxx,
and in borrowing the Loan, each of the Borrowers is acting for
its own account.
4.9 No deductions None of the Borrowers is required to make any
deduction or withholding from any payment which it may be
obliged to make to the Bank under or pursuant to the Security
Documents.
4.10 No established place of business in the United Kingdom or United
States None of the Security Parties has, nor will any of them
have during the Facility Period, an established place of
business in the United Kingdom or the United States of America.
4.11 Use of Loan The Loan will be used for the purposes specified in
Recital (D).
4.12 German money laundering act. The Borrowers confirm that they are
the beneficiaries (within the meaning of section 8 of the German
Money Laundering Act (Gesetz ueber das Aufspueren von Gewinnen
aus schweren Straftaten (Geldwaeschegesetz)) of the Loan, and
that they will promptly inform the Bank if they are not or cease
to be the beneficiaries and will then set down in writing the
name and the address of the beneficiaries.
5 Repayment and Prepayment
5.1 Repayment of Xxxxx Drawing The Borrowers agree to repay the
Xxxxx Drawing by sixteen (16) consecutive quarterly Repayment
Instalments for the Xxxxx Drawing, the first four (4) such
Repayment Instalments for the Xxxxx Drawing in the sum of five
hundred thousand Dollars ($500,000) each, the following eleven
(11) such Repayment Instalments for the Xxxxx Drawing in the sum
of three hundred and thirty seven thousand five hundred Dollars
($337,500) each, and the sixteenth (16th) and final Repayment
Instalment for the Xxxxx Drawing in the sum of two million
thirty seven thousand five hundred Dollars ($2,037,500)
(comprising a repayment instalment for the Xxxxx Drawing of
three hundred and thirty seven thousand five hundred Dollars
($337,500) and a balloon payment for the Xxxxx Drawing of one
million seven hundred thousand Dollars ($1,700,000) (the "Xxxxx
Balloon")) the first Repayment Date for the Xxxxx Drawing being
the date which is three calendar months after the Advance Date
for the Xxxxx Drawing and subsequent Repayment Dates for the
Xxxxx Drawing being at consecutive intervals of three calendar
months thereafter, with the sixteenth and final Repayment Date
for the Xxxxx Drawing falling not later than four years after
the Advance Date for the Xxxxx Drawing.
5.2 Repayment of Jedi Knight Drawing The Borrowers agree to repay
the Jedi Knight Drawing by sixteen (16) consecutive quarterly
Repayment Instalments for the Jedi Knight Drawing, the first
four (4) such Repayment Instalments for the Jedi Knight Drawing
in the sum of five hundred thousand Dollars ($500,000) each, the
following eleven (11) such Repayment Instalments for the Jedi
Knight Drawing in the sum of three hundred and sixty thousand
Dollars ($360,000) each, and the sixteenth and final Repayment
Instalment for the Jedi Knight Drawing in the sum of one million
seven hundred and ninety thousand Dollars ($1,790,000)
(comprising a Repayment Instalment for the Jedi Knight Drawing
of three hundred and sixty thousand Dollars ($360,000) and a
balloon payment for the Jedi Knight Drawing of one million four
hundred and thirty thousand Dollars ($1,430,000) (the "Jedi
Knight Balloon")) the first Repayment Date for the Jedi Knight
Drawing being the date which is three calendar months after the
Advance Date for the Jedi Knight Drawing and subsequent
Repayment Dates for the Jedi Knight Drawing being at consecutive
intervals of three calendar months thereafter, with the
sixteenth (16th) and final Repayment Date for the Jedi Knight
Drawing falling not later than four years after the Advance Date
for the Jedi Knight Drawing.
5.3 Repayment of Sea Wise Drawing The Borrowers agree to repay the
Sea Wise Drawing by twenty four (24) consecutive quarterly
Repayment Instalments for the Sea Wise Drawing, the first four
(4) such Repayment Instalments for the Sea Wise Drawing in the
sum of five hundred and fifty thousand Dollars ($550,000) each,
the following four (4) such Repayment Instalments for the Sea
Wise Drawing in the sum of five hundred thousand Dollars
($500,000) each, the following fifteen (15) such Repayment
Instalments for the Sea Wise Drawing in the sum of three hundred
and sixty thousand Dollars ($360,000) each, and the twenty
fourth (24th) and final Repayment Instalment for the Sea Wise
Drawing in the sum of one million nine hundred thousand Dollars
($1,900,000) (comprising a Repayment Instalment for the Sea Wise
Drawing of three hundred and sixty thousand Dollars ($360,000)
and a balloon payment for the Sea Wise Drawing of one million
five hundred and forty thousand Dollars ($1,540,000) ("Sea Wise
Balloon" and together with the Xxxxx Balloon and the Jedi Knight
Balloon, each a "Balloon")) the first Repayment Date for the Sea
Wise Drawing being the date which is three calendar months after
the Advance Date for the Sea Wise Drawing and subsequent
Repayment Dates for the Sea Wise Drawing being at consecutive
intervals of three calendar months thereafter, with the twenty
fourth and final Repayment Date for the Sea Wise Drawing falling
not later than six years after the Advance Date for the Sea Wise
Drawing.
5.4 Reduction of Repayment Instalments If the aggregate amount
advanced to the Borrowers is less than the relevant Maximum
Drawing Amount, the amount of each relevant Repayment Instalment
shall be reduced pro rata to the amount actually advanced.
5.5 Prepayment The Borrowers may prepay the Loan in whole or in part
in an amount equal to one million Dollars ($1,000,000) or an
integral multiple of that amount (or as otherwise may be agreed
by the Bank) provided that they have first given to the Bank not
fewer than ten days' prior written notice expiring on a Business
Day of their intention to do so. Any notice pursuant to this
Clause once given shall be irrevocable and shall oblige the
Borrowers to make the prepayment referred to in the notice on
the Business Day specified in the notice, together with all
interest accrued on the amount prepaid up to and including that
Business Day.
5.6 Mandatory Prepayment -- sale or Total Loss of Vessel In the case
of a sale or disposal of a Vessel, an amount equal to the higher
of (a) the Attributable Indebtedness for that Vessel, and (b) a
proportion of the Indebtedness that corresponds to the
proportion of the Value of the Vessel concerned (before such
sale or Total Loss) to the Value of all the Vessels, shall be
repaid in full from the proceeds of such sale or disposal
immediately upon the date of such sale or disposal of that
Vessel. In the case of a Total Loss of a Vessel, the
Attributable Indebtedness for that Vessel shall be repaid in
full from the proceeds of the Insurances on the earlier of the
date on which Insurance proceeds are received by that Borrower
and the date which is ninety (90) days after the date on which
that Vessel was declared a Total Loss. If for any reason the
sale of Total Loss proceeds shall be insufficient to repay in
full the Attributable Indebtedness for that Vessel, the
Borrowers' obligation to repay that Attributable Indebtedness
shall not be affected.
5.7 Prepayment indemnity If the Borrowers shall, subject always to
Clause 5.5, make a prepayment on a Business Day other than the
last day of an Interest Period in respect of the whole of the
Loan, they shall, in addition to the amount prepaid and accrued
interest, pay to the Bank any amount which the Bank may certify
is necessary to compensate the Bank for any Break Costs incurred
by the Bank as a result of the making of the prepayment in
question.
5.8 Application of prepayments In respect of each Drawing, any
prepayment in an amount less than the Attributable Indebtedness
for that Drawing shall be applied in satisfaction or reduction
first of any costs and other amounts outstanding in respect of
that Drawing secondly of all interest outstanding in respect of
that Drawing and thirdly of the Repayment Instalments in inverse
order of maturity in respect of that Drawing, commencing with
the relevant Balloon; fourthly of the Repayment Instalments for
each of the other Drawings in inverse order of maturity,
commencing with the Balloon for that Drawing and fifthly against
any remaining Attributable Indebtedness for the other Drawings.
5.9 No reborrowing No amount repaid or prepaid pursuant to this
Agreement may in any circumstances be reborrowed
6 Interest
6.1 Interest Periods The period during which the Loan shall be
outstanding pursuant to this Agreement shall be divided into
consecutive Interest Periods of three, six or twelve months'
duration, as selected by the Borrower by written notice to the
Bank not later than 11.00 a.m. on the third Business Day before
the beginning of the Interest Period in question, or such other
duration as may be agreed by the Bank in its discretion.
6.2 Beginning and end of Interest Periods The first Interest Period
shall begin on the first Advance Date. Notwithstanding Clause
6.1, the first Interest Period in respect of each Drawing other
than the first shall be of such a length as to end on the same
date as the then current Interest Period applicable to the
remainder of the Loan, and the final Interest Period shall end
on the Repayment Date applicable to the final Repayment
Instalment.
6.3 Interest Periods to meet Repayment Dates If the Borrowers shall
select, or the Borrowers and the Bank shall agree, an Interest
Period which does not expire on the next Repayment Date, there
shall, in respect of each part of the Loan equal to a Repayment
Instalment falling due for payment before the expiry of that
Interest Period, be a separate Interest Period which shall
expire on the relevant Repayment Date, and the Interest Period
selected or agreed shall apply to the balance of the Loan only.
6.4 Interest rate During each Interest Period interest shall accrue
on the Loan either:
(i) at the rate determined by the Bank to be the aggregate
of (a) the Margin and (b) LIBOR determined at or about
11.00 a.m. on the second Business Day prior to the
beginning of that Interest Period (in respect of
Interest Periods of 12 months or less) and (c) the
Mandatory Cost; or
(ii) the Agreed Rate determined at or about 11.00a.m. on the
second Business Day prior to the beginning of that
Interest Period (in respect of an Interest Period of 12
months or more).
6.5 Failure to select Interest Period If the Borrowers at any time
fail to select or to agree an Interest Period in accordance with
Clause 6.1, the interest rate applicable after the expiry of the
then current Interest Period shall be the rate determined by the
Bank in accordance with Clause 6.4 for consecutive Interest
Periods each of such duration (not exceeding three months) as
the Bank may in its discretion select.
6.6 Accrual and payment of interest Interest shall accrue from day
to day, shall be calculated on the basis of a 360 day year and
the actual number of days elapsed (or, in any circumstance where
market practice differs, in accordance with the prevailing
market practice) and shall be paid by the Borrowers to the Bank
on the last day of each Interest Period and additionally, during
any Interest Period exceeding three months, on the last day of
each successive three month period after the beginning of that
Interest Period.
6.7 Ending of Interest Periods Each Interest Period shall, subject
to Clauses 6.2 and 6.3, end on the date which numerically
corresponds to the date on which the immediately preceding
Interest Period ended (or, in the case of the first Interest
Period, to the first Advance Date) in the calendar month which
is the number of months selected or agreed after the calendar
month in which the immediately preceding Interest Period ended
(or, in the case of the first Interest Period, in which the
first Advance Date occulted), except that:-
6.7.1 if there is no numerically corresponding date in the
calendar month in which the Interest Period ends, the
Interest Period shall end on the last Business Day in
that calendar month; and
6.7.2 if any Interest Period would end on a day which is not a
Business Day, that Interest Period shall end on the next
succeeding Business Day (unless the next succeeding
Business Day falls in the next calendar month, in which
event the Interest Period in question shall end on the
next preceding Business Day).
Any adjustment made pursuant to Clause 6.7.1 or 6.7.2 shall be
ignored for the purpose of determining the date on which any
subsequent Interest Period shall end.
6.8 Default Rate If an Event of Default shall occur, the whole of
the Indebtedness shall, from the date of the occurrence of the
Event of Default, bear interest up to the date of actual payment
(both before and after judgment) at the Default Rate, compounded
at such intervals as the Bank shall in its discretion determine,
which interest shall be payable from time to time by the
Borrowers to the Bank on demand.
6.9 Determinations conclusive Each determination of an interest rate
made by the Bank in accordance with Clause 6 shall (save in the
case of manifest error or on any question of law) be final and
conclusive.
7 The Master Agreement
7.1 Purpose The Bank and the Borrowers have entered, and/or may
during the Facility Period enter, into one or more Transactions
pursuant to a Master Agreement, the terms and conditions of each
of which are or will be specified in a Confirmation sent by the
Bank to the Borrowers.
7.2 Additional Termination Event If the Loan is for any reason not
advanced to the Borrowers on or before the Availability
Termination Date, and the Bank and the Borrowers have entered
into any Transactions on or before the Availability Termination
Date, for the purposes of the Master Agreement an Additional
Termination Event (with the Bank as the Affected Party) shall be
deemed to have occurred on the Availability Termination Date.
7.3 Adjustment of Notional Amounts If the aggregate amount of the
Loan actually advanced by the Bank to the Borrowers is less than
the Notional Amount (or the aggregate Notional Amounts) of the
Hedging Transactions entered into on or before the last Advance
Date, the obligations of the Borrowers in respect of those
Hedging Transactions shall, unless otherwise agreed by the Bank,
be calculated, so far as the Bank considers it practicable to do
so, by reference to a Notional Amount (or aggregate Notional
Amounts) equal to the amount of the Loan actually advanced,
reduced on each Repayment Date by the amount of the Repayment
Instalment due on that Repayment Date, adjusted if necessary in
accordance with Clause 6.2.
7.4 Effect of prepayment If the Borrowers, subject always to Clause
5, prepay part of the Loan (whether pursuant to Clause 5 ,
Clause 10.2.5 or any other provision of this Agreement), and the
amount of the Loan remaining outstanding after application of
that prepayment is less than the Notional Amount (or the
aggregate Notional Amounts) of the Hedging Transactions then in
effect (reduced, if appropriate, in accordance with the
Confirmations relating to those Hedging Transactions), the
obligations of the Borrowers in respect of those Hedging
Transactions shall, unless otherwise agreed by the Bank, be
calculated, so far as the Bank considers it practicable to do
so, by reference to a Notional Amount (or aggregate Notional
Amounts) equal to the amount of the Loan remaining outstanding
after application of the prepayment in question, reduced on each
Repayment Date by the amount of the Repayment Instalment due on
that Repayment Date after taking into account the application of
the prepayment.
7.5 Authority In order to give effect to Clauses 7.3 and 7.4, or in
the event of voluntary or mandatory prepayment by the Borrowers
of the whole of the Loan, the Borrowers irrevocably authorise
the Bank to amend, restructure, unwind, cancel, net out,
terminate, liquidate, transfer or assign any of the rights
and/or obligations created pursuant to the Master Agreement in
respect of those Hedging Transactions, and/or to enter into any
other interest rate exchange and/or hedging transaction or
commitment with the Borrowers or with any other counterparty
approved by the Bank.
7.6 Termination of Transactions If the exercise of the Bank's rights
under Clause 7.5 results in the termination of any Transaction,
that Transaction shall, for the purposes of the Master Agreement
(including, without limitation, section 6(e)(i) of the Master
Agreement) be treated as a Terminated Transaction resulting from
an Event of Default by the Borrowers.
7.7 Indemnity The Borrowers will indemnify the Bank from time to
time on demand in respect of all liabilities, losses, costs or
expenses suffered, incurred or sustained by the Bank arising in
any way in relation to the exercise by the Bank of its rights
under this Clause, or arising in any way from any other
termination, cancellation, unwinding or restructuring of any
Transaction, together (in each case) with interest at the
Default Rate from the date of the Bank's demand until the date
on which the Bank receives payment or reimbursement, before or
after any relevant judgment.
8 Fees
8.1 Arrangement fee The Borrowers shall pay to the Bank a flat
Arrangement Fee equal to zero point sixty five per centum
(0.65%) of the Maximum Loan Amount payable at each Advance Date
or pro rata on each Advance Date.
8.2 Commitment commission The Borrowers shall pay to the Bank a
Commitment Commission calculated at the rate of zero point sixty
five per centum (0.65%) per annum from time to time commencing
from 22 September 2004, in the case of an amount of nineteen
million Dollars ($19,000,000) in respect of the approved
financing on 22 September 2004 of the m.vs "MARIGOLD", "SMART"
and "EVANGELISTRIA", and commencing from 24 November 2004 in the
case of the undrawn amount of the Maximum Loan Amount in each
case to the earlier to occur of the date on which the Maximum
Loan Amount shall have been advanced to the Borrowers and the
Availability Termination Date, both dates inclusive. The
Commitment Commission will accrue from day to day on the basis
of a 360 day year and the actual number of days elapsed, and
shall be paid quarterly in arrears with a final pro rata payment
on each Advance Date and the earlier to occur of the date on
which the Maximum Loan Amount shall have been advanced to the
Borrowers and the Availability Termination Date.
9 Security Documents
As security for the repayment of the Indebtedness, the Borrowers shall
execute and deliver to the Bank or cause to be executed and delivered to
the Bank, on or before the relevant Advance Date, the following Security
Documents in such forms and containing such terms and conditions as the
Bank shall require:-
9.1 the Mortgages a first preferred mortgage over each Vessel;
9.2 the Assignments a deed of assignment of the Insurances,
Earnings, Charter Rights and Requisition Compensation of each
Vessel;
9.3 the Guarantee the guarantee and indemnity of the Guarantor; and
9.4 the Accounts Security Deeds accounts security deeds in respect
of all amounts from time to time standing to the credit of the
Accounts.
10 Covenants
10.1 Negative covenants
None of the Borrowers will without the Bank's prior written
consent:-
10.1.1 no disposals or third party rights dispose of or create
or permit to arise or continue any Encumbrance or other
thins party right on or over all or any part of its
present or future assets or undertaking (including,
without limitation, any of its rights under or in
connection with the Master Agreement and any amount at
any time payable by it to the Bank under or pursuant to
the Master Agreement); nor
10.1.2 no borrowings borrow any money or incur any obligations
under leases; nor
10.1.3 no repayments repay any loans made to it; nor
10.1.4 no substantial liabilities except in the ordinary course
of business, incur any liability to any third party
which is in the opinion of the Bank of a substantial
nature; nor
10.1.5 no dealings with Master Agreement assign, novate or in
any other way transfer any of its rights or obligations
under or pursuant to the Master Agreement, nor enter
into any interest rate exchange or hedging agreement
with anyone other than the Bank, nor any other agreement
or commitment the effect of which is, in the opinion of
the Bank, materially to prejudice the hedging of the
Borrowers' interest rate risk effected by the Hedging
Transactions from time to time entered into between the
Borrowers and the Bank; nor
10.1.6 no other business engage in any business other than the
ownership, operation, chartering and management of the
Vessel owned by it; nor
10.1.7 no loans or other financial commitments make any loan
nor enter into any guarantee or indemnity or otherwise
voluntarily assume any actual or contingent liability in
respect of any obligation of any other person; nor
10.1.8 no dividends pay any dividends or make any other
distributions to shareholders or issue any new shares;
nor
10.1.9 no sale of Vessels sell or otherwise dispose of the
Vessel owned by it or any shares in that Vessel nor
agree to do so; nor
10.1.10 chartering restriction charter its Vessel for a period
exceeding eleven (11) months and shall not, following
the occurrence and during the continuation of an Event
of Default, let its Vessel on charter or renew or extend
any charter or other contract of employment of its
Vessel (nor agree to do so); nor
10.1.11 no change in management appoint anyone other than the
Managers as commercial or technical managers of the
Vessels, nor terminate or materially vary the
arrangements for the commercial or technical management
of the Vessels, nor permit the Managers to sub-contract
or delegate the commercial or technical management of
any Vessel to any third party; nor
10.1.12 no change in ownership or control permit any change in
its beneficial ownership and control from that advised
to the Bank at the date of this Agreement.
10.2 Positive covenants
10.2.1 Registration of Vessels The Borrowers undertake to
maintain the registration of the Vessels under the
Panamanian flag for the duration of the Facility Period.
10.2.2 Valuation certificates As and when and as often as may
be required by the Bank during the Facility Period, and
in any event no less frequently than once during each
consecutive period of twelve calendar months during the
Facility Period with the first such period commencing on
the last Advance Date, the Bank may obtain, at the
Borrowed expense, a valuation certificate addressed to
the Bank and dated no more than seven (7) days prior to
its delivery to the Bank from the Approved Brokers, such
certificate certifying the Market Value of each of the
Vessels then subject to a Mortgage. Such valuation(s)
may made with or without physical inspection of each
Vessel (as the Bank may require) on the basis of a sale
for prompt delivery for cash at arm's length on normal
commercial terms as between a willing seller and a
willing buyer and (at the option of the Bank) either
free of or subject to any existing charter or other
contract of employment.
10.2.3 Provision of information for valuations The Borrowers
irrevocably undertake promptly on the request of the
Bank and at the expense of the Borrowers to provide the
Approved Broker on request with such information
concerning each Vessel, her condition and her employment
as the Bank and the Approved Broker may reasonably
require for the purpose of the valuations referred to in
Clause 10.2.2.
10.2.4 Market Value of Vessels For the purpose of the Security
Documents, the Market Value of each Vessel shall be the
value for that Vessel certified in the last valuation
certificate obtained by the Bank pursuant to Clause
10.2.2 PROVIDED THAT if a Vessel at the date of the
Banks request shall be subject to any charter or other
contract of employment or any Encumbrance (other than as
created by or pursuant to the Security Documents) the
Bank shall be entitled to deduct from the Market Value
of that Vessel (determined as aforesaid) such sum Of
any) as in the Bank's discretion shall represent the
amount of the diminution in the Market Value of that
Vessel arising as a result of the existence of such
charter or other contract of employment or Encumbrance
and in that event, for the purpose of the Security
Documents, the Market Value of that Vessel shall be the
said value less any amount so deducted by the Bank.
10.2.5 Additional security If and so often as the aggregate of
the market values of the Vessels (determined by the Bank
in accordance with Clauses 10.2.2, 10.2.3 and 10.2.4)
plus the value of any additional security for the time
being provided to the Bank pursuant to this Clause shall
be less than one hundred and thirty five per centum
(135%) of the amount of the Loan, the Borrowers will,
within thirty days of the request of the Bank to do so,
at the Borrowers' option:-
10.2.5.1 pay to the Bank or to its nominee a cash
deposit in the amount of the shortfall to be
secured in favour of the Bank as additional
security for the payment of the Indebtedness;
or
10.2.5.2 give to the Bank other additional security in
amount and form acceptable to the Bank in its
discretion; or
10.2.5.3 prepay the amount of the Indebtedness which
will ensure that the aggregate of the market
values of the Vessels (determined as aforesaid)
plus the value of any such additional security
is not less than one hundred and thirty five
per centum (135%) of the amount of the Loan.
Clauses 5.7, 5.8 and 5.9 shall apply, mutatis mutandis,
to any prepayment made pursuant to this Clause and the
value of any additional security provided pursuant to
this Clause shall be determined by the Bank in its
discretion.
10.2.6 Financial statements The Borrowers will supply to the
Bank, without request:
(a) within one hundred and fifty (150) days after the
end of each financial year of each Borrower in as
many copies as the Bank may reasonably require
certified copies of each Borrower's annual audited
financial statements (on a combined or consolidated
basis); and
(b) within one hundred and fifty (150) days after the
end of each financial year in as many copies as the
Bank may reasonably require certified copies of the
Guarantor's annual audited financial statements on a
consolidated basis and in the same form and
substance as those produced by the Guarantor during
the Facility Period for filing with the United
States Security and Exchange Commission and which
have so far been filed for 2002 and 2003 and
certified as to their correctness by such auditors
as the Bank may approve;
(c) within one hundred and fifty (150) days after the
end of each financial year in as many copies as the
Bank may reasonably require, certified copies of the
audited annual or other published accounts and
copies of the financial statements of each
individual Borrower and the Guarantor;
in each case in a form consistent with generally
accepted accounting principles and practices
consistently applied;
10.2.7 Borrowers' Cash reserves The Borrowers will throughout
the Facility Period maintain on a consolidated basis
minimum free liquidity in amount of two million Dollars
($2,000,000), which is exclusive of amounts credited to
the Retention Account but inclusive of any surplus
credit balance on the Earnings Accounts. For the purpose
of this paragraph "free liquidity" means the sum of
cash, bank deposits, current shares, bonds and other
easily marketable securities having an original maturity
of not longer than three (3) months.
10.2.8 Guarantor's Net Income The Borrowers will procure that
the Guarantor will not pay any dividend or make any
other form of distribution or effect any form of
redemption or return of share capital other than a
dividend in respect of any financial year of the
Guarantor either:-
(a) in an amount not exceeding fifty per centum (50%) of
its Net Income for such financial year; or
(b) in an amount which, when aggregated with all
dividends declared and/or paid by the Guarantor
after 1 January 2003, does not exceed fifty per
centum (50%) of its accumulated Net Income from 1
January 2003 up to the most recent date as at which
any consolidated accounts for the Guarantor have
been delivered or were required to be delivered
under Clause 9 of the Guarantee.
10.2.9 Guarantor's dividends The Borrowers will procure that:-
(a) if the Guarantor on a consolidated basis does not
maintain the Cash Reserves at the time of any
dividend payment made in accordance with Clause
10.2.8 after the first Advance Date, such dividend
payments shall be permitted only with the prior
written approval of the Bank, and provided that the
same amount is applied as a prepayment on the Loan
(such prepayment shall be made in accordance with
Clauses 5.7, 5.8 and 5.9); and
(b) if the Guarantor on a consolidated basis does
maintain the Cash Reserves at the time of any
dividend payment made in accordance with Clam 10.2.8
after the first Advance Date, such dividend payment
shall be permitted without prepayment of the Loan
and, if a divided payment is made without prepayment
on the Loan, the Guarantor shall procure that the
Cash Reserves will be maintained at all times until
the end of the Facility Period.
10.2.10 Other information The Borrowers will promptly supply to
the Bank copies of all financial and other information
from time to time given by any of the Borrowers to its
shareholders and such information and explanations as
the Bank may from time to time require in connection
with the operation of the Vessels and the Borrowers'
profit and liquidity, and will procure that the Bank be
given the like information and explanations relating to
all other Security Parties.
10.2.11 Evidence of goodstanding The Borrowers will from time to
time on the request of the Bank provide the Bank with
evidence in form and substance satisfactory to the Bank
that the Security Parties and all corporate shareholders
of any of the Security Parties remain in good standing.
10.2.12 Evidence of current COFR Without limiting the Borrowers'
obligations under Clause 10.2.7, the Borrowers will from
time to time on the request of the Bank provide the Bank
with such evidence as the Bank may reasonably require
that each Vessel has a valid and current Certificate of
Financial Responsibility pursuant to the United States
Oil Pollution Xxx 0000.
10.2.13 ISM Code compliance The Borrowers will:-
(a) procure that each of the Vessels remains for the
duration of the Facility Period subject to a SMS;
(b) maintain a valid and current SMC for each of the
Vessels throughout the Facility Period;
(c) if not itself the Company, procure that each Company
maintains a valid and current DOC throughout the
Facility Period;
(d) immediately notify the Bank in writing of any actual
or threatened withdrawal, suspension, cancellation
or modification of the SMC of any Vessel or of the
DOC of any Company;
(e) immediately notify the Bank in writing of any
"accident" or "major non-conformity", as each of
those terms is defined in the Guidelines on the
Implementation of the International Safety
Management Code by Administrations adopted by the
Assembly of the International Maritime Organisation
pursuant to Resolution A.788(19), and of the steps
being taken to remedy the situation; and
(f) not without the prior written consent of the Bank
(which will not be unreasonably withheld) change the
identity of any Company.
10.2.14 ISPS Compliance: The Borrowers will comply with the ISPS
Code or any replacement of the ISPS Code and in
particular, without limitation, to:-
(a) procure that the Vessels and the company responsible
for the Vessel's compliance with the ISPS Code
comply with the ISPS Code; and
(b) maintain for the Vessels throughout the Facility
Period a valid and current International Ship
Security Certificate issued under the ISPS Code
("ISSC") and provide a copy to the Bank; and
(c) notify the Bank immediately in writing of any actual
or threatened withdrawal, suspension, cancellation
or modification of the ISSC.
10.2.15 Inspection of records The Borrowers will permit the
inspection of their financial records and accounts from
time to time by the Bank or its nominee.
10.2.16 Physical Condition Survey In respect of each Vessel,
after the Advance Date applicable to that Vessel the
Borrowers will permit the Bank to conduct a physical
condition survey of that Vessel and to conduct a
comprehensive inspection of the class and other records
of that Vessel by a surveyor appointed by the Bank (in
its discretion) at any reasonable time and from time to
time during the Facility Period and at the Borrowers'
expense.
10.2.17 Classification The Borrowers will procure that each
Vessel is classed with the highest class applicable to
vessels of her type with the classification society
referred to in the Mortgage for that Vessel or such
other classification society as may be acceptable to the
Bank.
10.2.18 Pari passu obligations The Borrowers will ensure that,
throughout the Facility Period, the obligations of the
Security Parties under or pursuant to the Security
Documents rank at least pari passu with all other
existing or future indebtedness, obligations or
liabilities of the Security Parties, other than any
mandatorily preferred by law.
10.2.19 Notification of Event of Default The Borrowers will
immediately notify the Bank in writing of the occurrence
of any Event of Default or Potential Event of Default.
10.2.20 Chartering The Borrowers will ensure and procure that in
the event of the Vessels being employed under a
charterparty or other contract of employment the
duration of such charterparty or contract of employment
shall not exceed a period, in aggregate, of eleven
months or the term remaining during the Facility Period
shall not exceed eleven months without prior written
consent of the Bank.
11 Accounts
11.1 Maintenance of accounts The Borrowers shall maintain the
Accounts with the Bank for the duration of the Facility Period
free of Encumbrances and rights of set off other than as created
by or pursuant to the Security Documents.
11.2 Earnings The Borrowers shall procure that there is credited to
the Earnings Account all Earnings and any Requisition
Compensation.
11.3 Transfers to Retention Account In respect of each Drawing, on
the day in each calendar month during the Facility Period which
numerically corresponds to the day on which the Advance Date for
that Drawing occurred (or, in any month in which there is no
such day, on the last Business Day of that month), the Borrowers
shall procure that there is transferred from the Earnings
Accounts, or any of them (and irrevocably authorise the Bank to
transfer from the Earnings Accounts, or any of them) to the
Retention Account:-
11.3.1 one-third of the amount of the Repayment Instalment for
that Drawing due on the next Repayment Date for that
Drawing; and
11.3.2 the amount of interest due on the next Interest Payment
Date for that Drawing divided by the number of months
between the last Interest Payment Date for that Drawing
and the Interest Payment Date in question for that
Drawing.
11.4 Additional payments to Retention Account If for any reason the
amount standing to the credit of the Earnings Accounts shall be
insufficient to make any transfer to the Retention Account
required by Clause 11.3, the Borrowers shall, without demand,
procure that there is credited to the Retention Account, on the
date on which the relevant amount would have been transferred
from the Earnings Accounts, an amount equal to the amount of the
shortfall.
11.5 Application of Retention Account The Borrowers shall procure
that there is transferred from the Retention Account (and
irrevocably authorise the Bank to transfer from the Retention
Account) to the Bank:-
11.5.1 on each Repayment Date, the amount of the Repayment
Instalment then due; and
11.5.2 on each Interest Payment Date, the amount of interest
then due.
11.6 Borrowers' obligations not affected If for any reason the amount
standing to the credit of the Retention Account shall be
insufficient to pay any Repayment Instalment or to make any
payment of interest when due, the Borrowers' obligation to pay
that Repayment Instalment or to make that payment of interest
shall not be affected.
11.7 Release of surplus Any amount remaining to the credit of the
Earnings Accounts following the making of any transfer required
by Clause 11.3 shall (unless an Event of Default or Potential
Event of Default shall have occurred and be continuing) be
released to or to the order of the Borrowers.
11.8 Restriction on withdrawal During the Facility Period no sum may
be withdrawn from the Accounts (except in accordance with this
Clause) without the prior written consent of the Bank.
11.9 Relocation of Accounts At any time following the occurrence and
during the continuation of an Event of Default, the Bank may
without the consent of the Borrowers relocate any or all of the
Accounts to any other branch of the Bank, without prejudice to
the continued application of this Clause and the rights of the
Bank under or pursuant to the Security Documents.
12 Events Of Default
12.1 The Bank's rights If any of the events set out in Clause 12.2
occurs, the Bank may at its discretion by notice to the
Borrowers declare itself to be under no further obligation to
the Borrowers under or pursuant to this Agreement and may
declare all or any part of the Indebtedness (including such
unpaid interest as shall have accrued) to be immediately
payable, in which event the Indebtedness (or the part of the
Indebtedness referred to in the Bank's notice) shall immediately
become due and payable without any further demand or notice of
any kind.
12.2 Events of Default The events referred to in Clause 12.1 are:-
12.2.1 payment default if the Borrowers default in the payment
of any part of the Indebtedness when due; or
12.2.2 other default if any of the Security Parties fails to
observe or perform any of the covenants, conditions,
undertakings, agreements or obligations on its part
contained in any of the Security Documents or shall in
any other way be in breach of or do or cause to be done
any act repudiating or evidencing an intention to
repudiate any of the Security Documents; or
12.2.3 misrepresentation or breach of warranty if any
representation or warranty made or repeated, or any
other information given, by any of the Security Parties
to the Bank in or leading up to or during the currency
of any of the Security Documents, or in or pursuant to
any notice or other document delivered to the Bank under
or pursuant to any of the Security Documents, is false
or incorrect or misleading in any respect which the Bank
in its discretion considers to be material; or
12.2.4 execution if a distress or execution or other process of
a court or authority is levied on any of the property of
any of the Security Parties before or after final
judgment or by order of any competent court or authority
and is not satisfied within seven days of levy; or
12.2.5 insolvency events if any of the Security Parties:-
12.2.5.1 resolves to appoint, or applies for or consents
to the appointment of, a receiver,
administrative receiver, trustee, administrator
or liquidator of itself or of all or part of
its assets; or
12.2.5.2 is unable or admits its inability to pay its
debts as they fall due; or
12.2.5.3 makes a general assignment for the benefit of
creditors or enters into a moratorium on
payment of any of its indebtedness; or
12.2.5.4 ceases trading or threatens to cease trading;
or
12.2.5.5 has appointed an Inspector under the Companies
Xxx 0000 or any statutory provision which the
Bank in its discretion considers analogous
thereto; or
12.2.6 insolvency proceedings if any proceedings are commenced
or threatened, or any order or judgment is given by any
court, for the bankruptcy, liquidation, winding up,
administration or re-organisation of any of the Security
Parties or for the appointment of a receiver,
administrative receiver, administrator, liquidator or
trustee of any of the Security Parties or of all or part
of the assets of any of the Security Parties, or if any
person appoints or purports to appoint such receiver,
administrative receiver, administrator, liquidator or
trustee; or
12.2.7 impossibility or illegality if any event occurs which
would, or would with the passage of time, render
performance of any of the Security Documents by any of
the Security Parties impossible, unlawfill or
unenforceable by the Banks; or
12.2.8 conditions subsequent if any of the conditions set out
in Clause 3.3 is not satisfied within the time
reasonably required by the Bank or, if any of the
conditions set out in Clause 3.3 have been temporarily
waived by the Bank but have not been satisfied after the
expiry of such waiver period; or
12.2.9 revocation or modification of consents etc. if any
consent, licence, approval, authorisation, filing,
registration or other requirement of any governmental,
judicial or other public body or authority which is now,
or which at any time during the Facility Period becomes,
necessary to enable any of the Security Parties to
comply with any of their obligations in or pursuant to
any of the Security Documents is not obtained or is
revoked, suspended, withdrawn or withheld, or is
modified in a manner which the Bank considers is, or may
be, prejudicial to its interests, or census to remain in
full force and effect; or
12.2.10 curtailment of business if the business of any of the
Security Parties is wholly or partially curtailed or
suspended by any intervention by or under authority of
any government, or if all or a substantial part of the
undertaking, property or assets of any of the Security
Parties is seized, nationalised, expropriated or
compulsorily acquired by or under authority of any
government; or
12.2.11 Master Agreement termination if a notice is sent by the
Bank under section 6(a) of the Master Agreement, or by
any person under section 6(b)(iv) of the Master
Agreement, in either case designating an Early
Termination Date for the purpose of the Master
Agreement, or if the Master Agreement is for any other
reason terminated, cancelled, suspended, rescinded,
revoked or otherwise ceases to remain in full force and
effect; or
12.2.12 loss of Vessel if any Vessel or any other vessel which
may from time to time be mortgaged to the Bank as
security for the repayment of all or any part of the
Indebtedness is destroyed, abandoned, confiscated,
forfeited, condemned as prize or becomes a Total Loss[,
except that a Total Loss shall not be an Event of
Default if:-
12.2.12.1 the Vessel or other vessel is insured in
accordance with the Security Documents; and
12.2.12.2 no insurer has refused to meet or has disputed
the claim for Total Loss and it is not
apparent to the Bank in its discretion that
any such refusal or dispute is likely to
occur; and
12.2.12.3 payment of all insurance proceeds in respect
of the Total Loss is made in full to the Bank
within one hundred and twenty days of the
occurrence of the casualty giving rise to the
Total Loss in question or such longer period
as the Bank may in its discretion agree]; or
12.2.13 acceleration of other indebtedness if any other
indebtedness or obligation for borrowed money of any of
the Security Parties becomes due or capable of being
declared due prior to its stated maturity by reason of
default on the part of that Security Party, or is not
repaid or satisfied at maturity; or
12.2.14 reduction of capital if any of the Security Parties
reduces its authorised or issued or subscribed capital;
or
12.2.15 challenge to registration if the registration of any
Vessel or any Mortgage is contested or becomes void or
voidable or liable to cancellation or termination, or if
the validity or priority of any Mortgage is contested;
or
12.2.16 war if the country of registration of any Vessel becomes
involved in war (whether or not declared) or civil war
or is occupied by any other power and the Bank in its
discretion considers that, as a result, the security
conferred by the Security Documents is materially
prejudiced; or
12.2.17 notice of termination if the Guarantor gives notice to
the Bank to determine its obligations under the
Guarantee; or
12.2.18 material adverse change etc. if anything is done or
permitted or omitted to be done by any of the Security
Parties which in the reasonable opinion of the Bank
jeopardises or imperils (or may jeopardise or imperil)
the rights conferred on the Bank by the Security
Documents, or if there occurs (in the opinion of the
Bank) any material adverse change in the business,
affairs or financial condition of any of the Security
Parties from that pertaining at the date of this
Agreement; or
12.2.19 analogous events if any event which (in the opinion of
the Bank) is analogous to any of the events set out
above shall occur.
13 Set-Off and Lien
13.1 Set-off The Borrowers irrevocably authorise the Bank at any time
after all or any part of the Indebtedness shall have become due
and payable to set off without notice any liability of any of
the Borrowers to the Bank (whether present or future, actual or
contingent, and irrespective of the branch or office, currency
or place of payment) against any credit balance from time to
time standing on any account of any of the Borrowers (whether
current or otherwise and whether or not subject to notice) with
any branch of the Bank in or towards satisfaction of the
Indebtedness and, in the name of the Bank or that Borrower, to
do all acts (including, without limitation, converting or
exchanging any currency) and execute all documents which may be
required to effect such application.
13.2 Lien The Bank shall have a lien on and be entitled to retain and
realise as additional security for the repayment of the
Indebtedness any cheques, drafts, bills, notes or negotiable or
non-negotiable instruments and any stocks, shares or marketable
or other securities and property of any kind of any of the
Borrowers (or of the Bank as agent or nominee of any of the
Borrowers) from time to time held by the Bank, whether for safe
custody or otherwise.
13.3 Restrictions on withdrawal Despite any term to the contrary in
relation to any deposit or credit balance at any time on any
account of any of the Borrowers with the Bank, no such deposit
or balance shall be repayable or capable of being assigned,
mortgaged, charged or otherwise disposed of or dealt with by any
of the Borrowers during the Facility Period except in accordance
with the Security Documents, but the Bank may from time to time
permit the withdrawal of all or any part of any such deposit or
balance without affecting the continued application of this
Clause.
13.4 Application Each of the Borrowers irrevocably authorises the
Bank to apply all sums which the Bank may receive:-
13.4.1 pursuant to a sale or other disposition of a Vessel or
any right, title or interest in a Vessel; or
13.4.2 by way of payment to the Bank of any sum in respect of
the Insurances, Earnings, Charter Rights or Requisition
Compensation of a Vessel; or
13.4.3 otherwise arising under or in connection with any of the
Security Documents
in or towards satisfaction, or by way of retention on account,
of the Indebtedness in such manner as the Bank may in its
discretion determine.
13.5 Master Agreement rights The rights conferred on the Bank by this
Clause shall be in addition to, and without prejudice to or
limitation of, the rights of netting and set off conferred on
the Bank by the Master Agreement. The Borrowers acknowledge that
the Bank shall be under no obligation to make any payment to the
Borrowers under or pursuant to the Master Agreement if, at the
time that payment becomes due, there shall have occurred an
Event of Default or Potential Event of Default, or an Event of
Default or Termination Event (as those terms are respectively
defined in the Master Agreement).
14 Assignment and Sub-Participation
14.1 Right to assign The Bank may assign or transfer all or any of
its rights under or pursuant to the Security Documents to any
other branch of the Bank or to any other bank or financial
institution, and may grant sub-participations in all or any part
of the Loan.
14.2 Borrowers' co-operation The Borrowers will co-operate fully with
the Bank in connection with any assignment, transfer or
sub-participation; will execute and procure the execution of
such documents as the Bank may require in connection therewith;
and irrevocably authorise the Bank to disclose to any proposed
assignee, transferee or sub-participant or any person who may
otherwise enter into contractual relations with the Bank in
relation to this Agreement (whether before or after any
assignment, transfer or sub-participation and whether or not any
assignment, transfer or sub-participation shall take place) all
information relating to the Security Parties, the Loan or the
Security Documents which the Bank may in its discretion consider
necessary or desirable.
14.3 Rights of assignee any assignee, transferee or sub-participant
of the Bank shall (unless limited by the express terms of the
assignment, transfer or sub-participation) take the full benefit
of every provision of the Security Documents benefiting the
Bank.
15 Payments, Mandatory Prepayment, Reserve Requirements and Illegality
15.1 Payments All amounts payable by any of the Borrowers under or
pursuant to any of the Security Documents shall be paid to such
accounts at such banks as the Bank may from time to time direct
to the Borrowers, and (unless payable in any other Currency of
Account) shall be paid in Dollars in same day funds (or such
funds as are required by the authorities in the United States of
America for settlement of international payments for immediate
value). Payments shall be deemed to have been received by the
Bank on the date on which the Bank receives authenticated advice
of receipt, unless that advice is received by the Bank on a day
other than a Business Day or at a time of day (whether on a
Business Day or not) when the Bank in its discretion considers
that it is impossible or impracticable for the Bank to utilise
the amount received for value that same day, in which event the
payment in question shall be deemed to have been received by the
Bank on the Business Day next following the date of receipt of
advice by the Bank.
152 No deductions or withholdings All payments (whether of principal
or interest or otherwise) to be made by any of the Borrowers
pursuant to the Security Documents shall, subject only to Clause
15.3, be made free and clear of and without deduction for or on
account of any Taxes or other deductions, withholdings,
restrictions, conditions or counterclaims of any nature.
15.3 Grossing-up If at any time any law requires (or is interpreted
to require) a Borrower to make any deduction or withholding from
any payment, or to change the rate or manner in which any
required deduction or withholding is made, that Borrower will
promptly notify the Bank and, simultaneously with making that
payment, will pay to the Bank whatever additional amount (after
taking into account any additional Taxes on, or deductions or
withholdings from, or restrictions or conditions on, that
additional amount) is necessary to ensure that, after making the
deduction or withholding, the Bank receives a net sum equal to
the sum which it would have received had no deduction or
withholding been made.
15.4 Evidence of deductions If at any time a Borrower is required by
law to make any deduction or withholding from any payment to be
made by it pursuant to any of the Security Documents, that
Borrower will pay the amount required to be deducted or withheld
to the relevant authority within the time allowed under the
applicable law and will, no later than thirty days after making
that payment, deliver to the Bank an original receipt issued by
the relevant authority, or other evidence acceptable to the
Bank, evidencing the payment to that authority of all amounts
required to be deducted or withheld.
15.5 Adjustment of due dates If any payment or transfer of funds to
be made under any of the Security Documents, other than a
payment of interest on the Loan or a payment pursuant to the
Master Agreement shall be due on a day which is not a Business
Day, that payment shall be made on the next succeeding Business
Day (unless the next succeeding Business Day falls in the next
calendar month in which event the payment shall be made on the
next preceding Business Day). Any such variation of time shall
be taken into account in computing any interest in respect of
that payment.
15.6 Change in law If, by reason of the introduction of any law, or
any change in any law, or the interpretation or administration
of any law, or in compliance with any request or requirement
from any central bank or any fiscal, monetary or other
authority:-
15.6.1 the Bank (or the holding company of the Bank) shall be
subject to any Tax with respect to payments of all or
any part of the Indebtedness; or
15.6.2 the basis of Taxation of payments to the Bank in respect
of all or any part of the Indebtedness shall be changed;
or
15.6.3 any reserve requirements shall be imposed, modified or
deemed applicable against assets held by or deposits in
or for the account of or loans by any branch of the Bank
except to the extent included in the Mandatory Cost; or
15.6.4 the manner in which the Bank allocates capital resources
to its obligations under this Agreement and/or the
Master Agreement or any ratio (whether cash, capital
adequacy, liquidity or otherwise) which the Bank is
required or requested to maintain shall be affected; or
15.6.5 there is imposed on the Bank (or on the holding company
of the Bank) any other condition in relation to the
Indebtedness or the Security Documents;
and the result of any of the above shall be to increase the cost
to the Bank (or to the holding company of the Bank) of the Bank
making or maintaining the Loan or of maintaining its obligations
under the Master Agreement, or to cause the Bank to suffer (in
its opinion) a material reduction in the rate of return on its
overall capital below the level which it reasonably anticipated
at the date of this Agreement and which it would have been able
to achieve but for its entering into this Agreement or the
Master Agreement, and/or performing its obligations under this
Agreement or the Master Agreement, the Borrowers shall from time
to time pay to the Bank on demand the amount which shall
compensate the Bank (or the holding company of the Bank) for
such additional cost or reduced return. A certificate signed by
an authorised signatory of the Bank setting out the amount of
that payment and the basis of its calculation shall be submitted
to the Borrowers and shall be conclusive evidence of such amount
save for manifest error or on any question of law.
15.7 Illegality and impracticality Notwithstanding anything contained
in the Security Documents, the obligation of the Bank to advance
or maintain the Loan shall terminate in the event that a change
in any law or in the interpretation of any law by any authority
charged with its administration shall make it unlawful or, in
the opinion of the Bank, impracticable for the Bank to advance
or maintain the Loan. In that event the Bank shall, by written
notice to the Borrowers, declare its obligations to be
immediately terminated. If all or any part of the Loan shall
have been advanced by the Bank to the Borrowers, the
Indebtedness (including all accrued interest) shall be prepaid
within thirty days from the date of such notice. Clause 5.7
shall apply to that prepayment if it is made on a day other than
the last day of an Interest Period.
15.8 Changes in market circumstances If at any time the Bank
determines (which determination shall be final and conclusive
and binding on the Borrowers) that, by reason of changes
affecting the London Interbank market, adequate and fair means
do not exist for ascertaining the rate of interest on the Loan
pursuant to this Agreement:-
15.8.1 the Bank shall give notice to the Borrowers of the
occurrence of such event; and
15.8.2 the Bank shall as soon as reasonably practicable certify
to the Borrowers in writing the effective cost to the
Bank of maintaining the Loan for such further period as
shall be selected by the Bank and the rate of interest
payable by the Borrowers for that period; or, if that is
not acceptable to the Borrowers,
15.8.3 the Bank will negotiate with the Borrowers in good faith
with a view to modifying this Agreement to provide a
substitute basis for the Loan which is financially a
substantial equivalent to the basis provided for in this
Agreement.
If, within thirty days of the giving of the notice referred to
in Clause 15.8.1, the Borrowers and the Bank fail to agree in
writing on a substitute basis for the Loan, the Borrowers will
immediately prepay the Indebtedness. Clause 5.7 shall apply to
that prepayment if it is made on a day other than the last day
of an Interest Period.
15.9 Non-availability of currency If the Bank is for any reason
unable to obtain Dollars in the London Interbank market and is,
as a result, or as a result of any other contingency affecting
the London Interbank market, unable to advance or maintain the
Loan in Dollars, the Bank shall give notice to the Borrowers and
the Bank's obligations to make the Loan available shall
immediately cease. In that event, if all or any part of the Loan
shall have been advanced by the Bank to the Borrowers, the Bank
will negotiate with the Borrowers in good faith with a view to
establishing a mutually acceptable basis for funding the Loan
from an alternative source. If the Bank and the Borrowers have
failed to agree in writing on a basis for funding the Loan from
an alternative source by 11.00 a.m. on the second Business Day
prior to the end of the then current Interest Period, the
Borrowers will (without prejudice to their other obligations
under or pursuant to this Agreement, including, without
limitation, their obligation to pay interest on the Loan,
arising on the expiry of the then current Interest Period)
prepay the Indebtedness to the Bank on the expiry of the then
current Interest Period.
16 Communications
16.1 Method Any Communication may be given, delivered, made or served
(as the case may be) under or in relation to this Agreement by
letter or fax and shall be in the English language and sent
addressed:-
16.1.1 in the case of the Bank to the Bank at its address at
the head of this Agreement fax no: x00 00 0000 00000)
marked for the attention of: Xxxxx Xxxxxx; and
16.1.2 in the case of the Borrowers to the Communications
Address;
or to such other address or fax number as the Bank or the
Borrowers may designate for themselves by written notice to the
other.
16.2 Timing A Communication shall be deemed to have been duly given,
delivered, made or served to or on, and received by, the
Borrowers:-
16.2.1 in the case of a fax when the sender receives one or
more transmission reports showing the whole of the
Communication to have been transmitted to the correct
fax number;
16.2.2 if delivered to an officer of any of the Borrowers or
left at the Communications Address at the time of
delivery or leaving; or
16.2.3 if posted, at 9.00 am. on the Business Day after posting
by prepaid first class post.
A Communication shall only be deemed to have been duly given,
delivered, made or served to or on, and received by, the Bank on
actual receipt of the whole of that Communication by the Bank.
16.3 Indemnity The Borrowers shall indemnify the Bank against any
cost, claim, liability, loss or expense (including legal fees
and any Value Added Tax or any similar or replacement tax (if
applicable)) which the Bank may sustain or incur as a
consequence of any Communication sent by or on behalf of any of
the Borrowers by fax not being received by its intended
recipient, or being received incomplete, or by reason of any
Communication purportedly having been sent by or on behalf of
any of the Borrowers having been sent fraudulently.
17 General Indemnities
17.1 Currency In the event of the Bank receiving or recovering any
amount payable under any of the Security Documents in a currency
other than the Currency of Account and if the amount received or
recovered is insufficient when converted into the Currency of
Account at the date of receipt to satisfy in full the amount
due, the Borrowers shall, on the Bank's written demand, pay to
the Bank such further amount in the Currency of Account as is
sufficient to satisfy in full the amount due and that further
amount shall be due to the Bank as a separate debt under this
Agreement.
17.2 Costs and expenses The Borrowers will, within fourteen days of
the Bank's written demand, reimburse the Bank for all costs and
expenses (including Value Added Tax or any similar or
replacement tax if applicable) of and incidental to:-
17.2.1 the negotiation, preparation, execution and registration
of the Security Documents (whether or not any of the
Security Documents are actually executed or registered
and whether or not all or any part of the Loan is
advanced);
17.2.2 any amendments, addenda or supplements to any of the
Security Documents (whether or not completed);
17.2.3 any other documents which may at any time be required by
the Bank to give effect to any of the Security Documents
or which the Bank is entitled to call for or obtain
pursuant to any of the Security Documents (including,
without limitation, all premiums and other sums from
time to time payable by the Bank in relation to the
Mortgagees' Insurances); and
17.2.4 the exercise of the rights, powers, discretion and
remedies of the Bank under or pursuant to the Security
Documents.
17.3 Events of Default The Borrowers shall indemnify the Bank from
time to time on demand against all losses and costs incurred or
sustained by the Bank as a consequence of any Event of Default,
including (without limitation) any Break Costs.
17.4 Funding costs The Borrowers shall indemnify the Bank from time
to time on demand against all losses and costs incurred or
sustained by the Bank if, for any reason, a part of the Loan is
not advanced to the Borrowers after its Drawdown Notice has been
given to the Bank, or is advanced on a date other than that
requested in its Drawdown Notice (unless, in either case, as a
result of any default by the Bank), including (without
limitation) any Break Costs.
17.5 Protection and enforcement The Borrowers shall indemnify the
Bank from time to time on demand against all losses, costs and
liabilities which the Bank may from time to time sustain, incur
or become liable for in or about the protection, maintenance or
enforcement of the rights conferred on the Bank by the Security
Documents or in or about the exercise or purported exercise by
the Bank of any of the rights, powers, discretions or remedies
vested in it under or arising out of the Security Documents,
including (without limitation) any losses, costs and liabilities
which the Bank may from time to time sustain, incur or become
liable for by reason of the Bank being mortgagee of any Vessel
and/or a lender to the Borrowers, or by reason of the Bank being
deemed by any court or authority to be an operator or
controller, or in any way concerned in the operation or control,
of any Vessel.
17.6 Liabilities of Bank The Borrowers will from time to time
reimburse the Bank on demand for all sums which the Bank may pay
or become actually or contingently liable for on account of any
Borrower or in connection with any Vessel (whether alone or
jointly or jointly and severally with any other person)
including (without limitation) all sums which the Bank may pay
or guarantees which it may give in respect of the Insurances,
any expenses incurred by the Bank in connection with the
maintenance or repair of any Vessel or in discharging any lien,
bond or other claim relating in any way to any Vessel, and any
sums which the Bank may pay or guarantees which it may give to
procure the release of any Vessel from arrest or detention.
17.7 Taxes The Borrowers shall pay all Taxes to which all or any part
of the Indebtedness or any of the Security Documents may be at
any time subject and shall indemnify the Bank on demand against
all liabilities, costs, claims and expenses resulting from any
omission to pay or delay in paying any such Taxes.
18 Miscellaneous
18.1 Waivers No failure or delay on the part of the Bank in
exercising any right, power, discretion or remedy under or
pursuant to any of the Security Documents, nor any actual or
alleged course of dealing between the Bank and any of the
Borrowers, shall operate as a waiver of, or acquiescence in, any
default on the part of any Security Party, unless expressly
agreed to do so in writing by the Bank, nor shall any single or
partial exercise by the Bank of any right, power, discretion or
remedy preclude any other or further exercise of that right,
power, discretion or remedy, or the exercise by the Bank of any
other right, power, discretion or remedy.
18.2 No oral variations No variation or amendment of any of the
Security Documents shall be valid unless in writing and signed
on behalf of the Bank.
18.3 Severability If at any time any provision of any of the Security
Documents is invalid, illegal or unenforceable in any respect
that provision shall be severed from the remainder and the
validity, legality and enforceability of the remaining
provisions shall not be affected or impaired in any way.
18.4 Successors etc. The Security Documents shall be binding on the
Security Parties and on their successors and permitted
transferees and assignees, and shall inure to the benefit of the
Bank and its successors, transferees and assignees. None of the
Borrowers may assign nor transfer any of its rights under or
pursuant to any of the Security Documents without the prior
written consent of the Bank.
18.5 Further assurance If any provision of the Security Documents
shall be invalid or unenforceable in whole or in part by reason
of any present or future law or any decision of any court, or if
the documents at any time held by the Bank are considered by the
Bank for any reason insufficient to carry out the terms of this
Agreement, then from time to time the Borrowers will promptly,
on demand by the Bank, execute or procure the execution of such
further documents as in the opinion of the Bank are necessary to
provide adequate security for the repayment of the Indebtedness.
18.6 Other arrangements The Bank may, without prejudice to its rights
under or pursuant to the Security Documents, at any time and
from time to time, on such terms and conditions as it may in
their discretion determine, and without notice to any Borrower,
grant time or other indulgence to, or compound with, any other
person liable (actually or contingently) to the Bank in respect
of all or any part of the Indebtedness, and may release or renew
negotiable instruments and take and release securities and hold
funds on realisation or suspense account without affecting the
liabilities of the Borrowers or the rights of the Bank under or
pursuant to the Security Documents.
18.7 Advisers The Borrowers irrevocably authorise the Bank, at any
time and from time to time during the Facility Period, to
consult insurance advisers on any matters relating to the
Insurances, including, without limitation, the collection of
insurance claims, and from time to time to consult or retain
advisers or consultants to monitor or advise on any other claims
relating to the Vessels. The Borrowers will provide such
advisers and consultants with all information and documents
which they may from time to time require and will reimburse the
Bank on demand for all costs and expenses incurred by the Bank
in connection with the consultation or retention of such
advisers or consultants.
18.8 Delegation The Bank may at any time and from time to time
delegate to any person any of its rights, powers, discretions
and remedies pursuant to the Security Documents on such terms as
it may consider appropriate (including the power to
sub-delegate).
18.9 Rights etc. cumulative Every right, power, discretion and remedy
conferred on the Bank under or pursuant to the Security
Documents shall be cumulative and in addition to every other
right, power, discretion or remedy to which it may at any time
be entitled by law or in equity. The Bank may exercise each of
its rights, powers, discretions and remedies as often and in
such order as it deems appropriate. The exercise or the
beginning of the exercise of any right, power, discretion or
remedy shall not be interpreted as a waiver of the right to
exercise that or any other right, power, discretion or remedy
either simultaneously or subsequently.
18.10 No enquiry The Bank shall not be concerned to enquire into the
powers of the Security Parties or of any person purporting to
act on behalf of any of the Security Parties, even if any of the
Security Parties or any such person shall have acted in excess
of their powers or if their actions shall have been irregular,
defective or informal, whether or not the Bank had notice
thereof.
18.11 Continuing security The security constituted by the Security
Documents shall be continuing and shall not be satisfied by any
intermediate payment or satisfaction until the Indebtedness
shall have been repaid in full and the Bank shall be under no
further actual or contingent liability to any third party in
relation to the Vessels, the Insurances, Earnings or Requisition
Compensation or any other matter referred to in the Security
Documents.
18.12 Security cumulative The security constituted by the Security
Documents shall be in addition to any other security now or in
the future held by the Bank for or in respect of all or any part
of the Indebtedness, and shall not merge with or prejudice or be
prejudiced by any such security or any other contractual or
legal rights of the Bank, nor affected by any irregularity,
defect or informality, or by any release, exchange or variation
of any such security. Section 93 of the Law of Property Xxx 0000
and all provisions which the Bank considers analogous thereto
under the law of any other relevant jurisdiction shall not apply
to the security constituted by the Security Documents.
18.13 Re-instatement If the Bank takes any steps to exercise any of
its rights, powers, remedies or discretions pursuant to the
Security Documents and the result shall be adverse to the Bank,
the Borrowers and the Bank shall be restored to their former
positions as if no such steps had been taken.
18.14 No liability Neither the Bank nor any agent or employee of the
Bank, nor any receiver and/or manager appointed by the Bank,
shall be liable for any losses which may be incurred in or about
the exercise of any of the rights, powers, discretions or
remedies of the Bank under or pursuant to the Security Documents
nor liable as mortgagee in possession for any loss on
realisation or for any neglect or default of any nature for
which a mortgagee in possession might otherwise be liable.
18.15 Rescission of payments etc. Any discharge, release or
reassignment by the Bank of any of the security constituted by,
or any of the obligations of any Security Party contained in,
any of the Security Documents shall be (and be deemed always to
have been) void if any act (including, without limitation, any
payment) as a result of which such discharge, release or
reassignment was given or made is subsequently wholly or
partially rescinded or avoided by operation of any law.
18.16 Subsequent Encumbrances If the Bank receives notice of any
subsequent Encumbrance affecting any Vessel or all or any part
of the Insurances, Earnings, Charter Rights or Requisition
Compensation or the Accounts, the Bank may open a new account in
its books for the Borrowers. If the Bank does not open a new
account, then (unless the Bank gives written notice to the
contrary to the Borrowers) as from the time of receipt by the
Bank of notice of such subsequent Encumbrance, all payments made
to the Bank shall be treated as having been credited to a new
account of the Borrowers and not as having been applied in
reduction of the Indebtedness.
18.17 Releases If the Bank shall at any time in its discretion release
any party from all or any part of any of the Security Documents,
the liability of any other party to the Security Documents shall
not be varied or diminished.
18.18 Discretions Unless otherwise expressly indicated, where the Bank
is stated in the Security Documents to have a discretion and/or
where the opinion of the Bank is referred to and/or where the
consent, agreement or approval of the Bank is required for any
course of action, or where anything is required to be acceptable
to the Bank, the Bank shall have a sole, absolute and unfettered
discretion and/or may give or withhold its consent, agreement or
approval at its sole, absolute and unfettered discretion.
18.19 Certificates Any certificate or statement signed by an
authorised signatory of the Bank purporting to show the amount
of the Indebtedness (or any part of the Indebtedness) or any
other amount referred to in any of the Security Documents shall,
save for manifest error or on any question of law, be conclusive
evidence as against the Borrowers of that amount.
18.20 Survival of representations and warranties The representations
and warranties on the part of the Borrowers contained in this
Agreement shall survive the execution of this Agreement and the
advance of the Loan.
18.21 Counterparts This Agreement may be executed in any number of
counterparts each of which shall be original but which shall
together constitute the same instrument.
18.22 Contracts (Rights of Third Parties) Xxx 0000 No term of the
Agreement is enforceable by a person who is not a party to it.
18.23 Disclaimer for unencoded e-mails All information related or
connected to the making of the Loan by the Bank and each
respective credit decision and negotiation related or connected
to the drafting and drawing up of any of the Loan documents, the
Security Documents and any transaction documents may be made or
given by the Bank, its respective lawyers and any other
consultant inter se and otherwise, by e-mail. The Borrowers
confirm their awareness of the risk generally (which include the
possibility that the confidentiality and the authenticity may
not be safeguarded) related to communication by e-mail.
18.24 Non-Immunity The Borrowers do not have any right of immunity
from set-off, suit or execution, attachment or other legal
process under the laws of England or any other jurisdiction.
18.25 Commercial act The exercise by the Borrowers of their rights and
performance and discharge of their duties and liabilities under
this Agreement will constitute commercial acts done and
performed by the Borrowers for private and commercial purposes.
18.26 Waiver of immunity To the extent that the Borrowers may in any
jurisdiction, in which proceedings may at any time be taken for
the enforcement of this Agreement and/or any of the other
Security Documents, claim for themselves or their assets
immunity from suit, judgment, execution, attachment (whether in
aid of execution, before judgment or otherwise) or other legal
process, and to the extent that in any such jurisdiction there
may be attributed to themselves or their assets any such
immunity (whether or not claimed), the Borrowers hereby
irrevocably agree not to claim and hereby irrevocably waive any
such immunity to the full extent permitted by the laws of such
jurisdiction.
19 Law and Jurisdiction
19.1 Governing law This Agreement shall in all respects be governed
by and interpreted in accordance with English law.
19.2 Jurisdiction For the exclusive benefit of the Bank, the parties
to this Agreement irrevocably agree that the courts of England
are to have jurisdiction to settle any disputes which may arise
out of or in connection with this Agreement and that any
Proceedings may be brought in those courts.
19.3 Alternative jurisdictions Nothing contained in this Clause shall
limit the right of the Bank to commence any Proceedings against
any of the Borrowers in any other court of competent
jurisdiction nor shall the commencement of any Proceedings
against any of the Borrowers in one or more jurisdictions
preclude the commencement of any Proceedings in any other
jurisdiction, whether concurrently or not.
19.4 Waiver of objections Each of the Borrowers irrevocably waives
any objection which it may now or in the future have to the
laying of the venue of any Proceedings in any court referred to
in this Clause, and any claim that those Proceedings have been
brought in an inconvenient or inappropriate forum, and
irrevocably agrees that a judgment in any Proceedings commenced
in any such court shall be conclusive and binding on it and may
be enforced in the courts of any other jurisdiction.
19.5 Service of process Without prejudice to the right of the Bank to
use any other method of service permitted by law, each of the
Borrowers irrevocably agrees that any writ, notice, judgment or
other legal process shall be sufficiently served on it if
addressed to it and left at or sent by post to the Address for
Service, and in that event shall be conclusively deemed to have
been served at the time of leaving or, if posted, at 9.00 a.m.
on the Business Day after posting by prepaid first class post.
IN WITNESS of which the parties to this Agreement have executed this Agreement
the day and year first before written.
Schedule 1
Calculation of the Mandatory Cost
(a) The Mandatory Cost for the Loan for each Interest Period is the rate
determined by the Bank in accordance with the following formulae:
(i) where the Loan is denominated in Sterling:
BY + S(Y-Z) + F x 0.01% per annum = Mandatory Cost
----------------------
100-(B+S)
(ii) where the loan is denominated in any other Permitted Currency:
F x 0.01% per annum = Mandatory Cost
--------
300
where on the day of application of the formula:
B is the percentage of the Bank's eligible liabilities (in excess of any
stated minimum) which the Bank of England requires the Bank to hold on
a noninterest-bearing deposit account in accordance with its cash
ratio requirements;
Y is the rate at which Sterling deposits are offered by the Bank to
leading banks in the London Interbank market at or about 11.00 a.m. on
that day for the relevant period;
S is the percentage of the Bank's eligible liabilities which the Bank of
England requires the Bank to place as a special deposit;
Z is the interest rate per annum allowed by the Bank of England on
special deposits; and
F is the charge payable by the Bank to the Financial Services Authority
under paragraph 2.02 or 2.03 (as appropriate) of the Fees Regulations
or the equivalent provisions in any replacement regulations (with, for
this purpose, the figure for the minimum amount in paragraph 2.02b or
such equivalent provision deemed to be zero), expressed in pounds per
(pound)1 million of the fee base of the Bank.
(b) For the purpose of this Schedule :
(i) "eligible liabilities" and "special deposits" have the meanings given
to them at the time of application of the formula by the Bank of
England;
(ii) "fee base" has the meaning given to it in the Fees Regulations; (iii)
"Fees Regulations" means:-
(A) up to and including 31 March 2002, the Banking Supervision (Fees)
Regulations 2001; and
(B) after that date any regulations governing the payment of fees for
banking supervision;
(iv) "relevant period" in relation to each Interest Period, means:
(A) if it is three months or less, that Interest Period; or
(B) if it is more than three months, three months.
(c) In the application of the formula B, Y, S and Z are included in the formula
as figures and not as percentages, e.g. if B = 0.5% and Y = 15%, BY is
calculated as 0.5. x 15.
(d) (i) The formula is applied on the first day of each relevant period
comprised in the relevant Interest Period.
(ii) Each rate calculated in accordance with the formula is, if necessary,
rounded upward to four decimal places.
(e) If a change in circumstances has rendered, or will render, the formula
inappropriate, the Bank shall notify the Borrower of the manner in which
the Mandatory Cost will subsequently be calculated. The manner of
calculation so notified by the Bank shall, in the absence of manifest
error, be binding on the Borrower.
SIGNED by
duly authorised for and on
behalf of PISCES SHIPHOLDING LTD.
SIGNED by
duly authorised for and on
behalf of XXXXX XXXX NAVIGATION S.A.
SIGNED by
duly authorised for and on
behalf of SNAPPER MARINE LTD.
SIGNED by
duly authorised for and on
behalf of HSH NORDBANK AG
Appendix A
To: HSH NORDBANK AG
From: PISCES SHIPHOLDING LTD.
XXXXX XXXX NAVIGATION S.A.
SNAPPER MARINE LTD.
2004
Dear Sirs,
Drawdown Notice
We refer to the Loan Agreement dated ____________ 2004 made between
ourselves and yourselves ("the Agreement").
Words and phrases defined in the Agreement have the same meaning when used
in this Drawdown Notice.
Pursuant to Clause 2.3 of the Agreement, we irrevocably request that you
advance the sum of [____] to us on __________ 2004, which is a Business Day, by
paying the amount of the Loan to [____] [in accordance with instructions given
to you by the Bank].
We warrant that the representations and warranties contained in Clause 4 of
the Agreement are true and correct at the date of this Drawdown Notice and will
be true and correct on 2004; that no Event of Default nor Potential Event of
Default has occurred and is continuing, and that no Event of Default or
Potential Event of Default will result from the advance of the Loan requested in
this Drawdown Notice.
[We select the period of [____] months as the first Interest Period].
Yours faithfully
--------------------
For and on behalf of
PISCES SHIPHOLDING LTD.
XXXXX XXXX NAVIGATION S.A.
SNAPPER MARINE LTD.
02545.0001 #553485
