AS AMENDED
TBS
INTERNATIONAL PLC & SUBSIDIARIES EXHIBIT
10.1
AS AMENDED
Date
6 May 2010
ARGYLE
MARITIME CORP.
XXXXX
MARITIME CORP.
DORCHESTER
MARITIME CORP.
LONGWOODS
MARITIME CORP.
XxXXXXX
MARITIME CORP.
SUNSWYCK
MARITIME CORP.
as Joint
and Several Borrowers
– and
–
THE
BANKS AND FINANCIAL INSTITUTIONS
listed
in Schedule 1
as
Lenders
– and
–
THE
ROYAL BANK OF SCOTLAND PLC
as
Mandated Lead Arranger
– and
–
THE
ROYAL BANK OF SCOTLAND PLC
as
Bookrunner, Agent, Security Trustee and Swap Bank
relating
to
a term
loan facility of US$150,000,000
INDEX
Clause Page
THIS AGREEMENT is made on
2010
BETWEEN
|
(1)
|
ARGYLE MARITIME CORP.,
XXXXX MARITIME
CORP., DORCHESTER
MARITIME CORP., LONGWOODS MARITIME
CORP., XxXXXXX
MARITIME CORP. and SUNSWYCK MARITIME CORP.,
each a corporation organised and existing under the laws of the Xxxxxxxx
Islands and having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands MH96960 as joint
and several borrowers (the “Borrowers”);
|
|
(2)
|
THE BANKS AND FINANCIAL
INSTITUTIONS listed in Schedule 1 as lenders (the “Lenders”);
|
|
(3)
|
THE ROYAL BANK OF SCOTLAND
PLC, a company incorporated in Scotland having its registered
office at 00 Xx. Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxxxx acting through
the Shipping Business Centre at 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX,
Xxxxxxx as mandated lead arranger (the “Mandated Lead
Arranger”);
|
|
(4)
|
THE ROYAL BANK OF SCOTLAND
PLC, a company incorporated in Scotland having its registered
office at 00 Xx. Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxxxx acting through
the Shipping Business Centre at 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX,
Xxxxxxx as agent (the “Agent”);
|
|
(5)
|
THE ROYAL BANK OF SCOTLAND
PLC, a company incorporated in Scotland having its registered
office at 00 Xx. Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxxxx acting through
the Shipping Business Centre at 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX,
Xxxxxxx as security trustee (the “Security
Trustee”);
|
|
(6)
|
THE ROYAL BANK OF SCOTLAND
PLC, a company incorporated in Scotland having its registered
office at 00 Xx. Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxxxx acting through
the Shipping Business Centre at 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX,
Xxxxxxx as swap bank (the “Swap Bank”);
and
|
|
(7)
|
THE ROYAL BANK OF SCOTLAND
PLC, a company incorporated in Scotland having its registered
office at 00 Xx. Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxxxx acting through
the Shipping Business Centre at 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX,
Xxxxxxx as bookrunner (the “Bookrunner”).
|
BACKGROUND
|
(A)
|
By
a loan agreement dated 29 March 2007 as amended by a side letter dated 24
July 2007, a supplemental letter agreement dated 26 March 2008, a
supplemental agreement dated 27 March 2009, a side letter dated 27 May
2009, a side letter dated 3 September 2009, a side letter dated 31
December 2009, a supplemental agreement dated 7 January 2010, a side
letter dated 28 February 2010 and a side letter dated 31 March 2010 (the
“Loan Agreement”)
each made between (inter alia) (i) the Borrowers as joint and several
borrowers, (ii) the Lenders, (iii) the Mandated Lead Arranger, (iv) the
Bookrunner, (v) the Agent, (vi) the Security Trustee and (viii) the Swap
Bank, the Lenders agreed to make available to the Borrowers a term loan
facility in an amount of One hundred and fifty million United States
Dollars (US$150,000,000).
|
|
(B)
|
By
an ISDA master agreement dated 29 March 2007 (the “Master Agreement”) made
between the Borrowers and the Swap Bank, the Borrowers have entered into
or will enter into certain Transactions (as such term is defined in the
said Master Agreement) pursuant to separate Confirmations (as such term is
defined in the said Master
Agreement).
|
|
(C)
|
Subject
to the terms and conditions of this Agreement the Lenders have agreed with
the Borrowers:
|
|
(i)
|
to
amend certain covenants in the Loan Agreement on the terms and conditions
set out herein;
|
|
(ii)
|
to
increase the Margin;
|
|
(iii)
|
that
the Borrowers will pay additional
fees;
|
|
(iv)
|
to
extend the Availability Period in respect of certain
Loans;
|
|
(v)
|
to
reduce the maturity of the Loans;
and
|
|
(vi)
|
to
take additional security in the form of Shares Security Deeds in respect
of the share capital of the Borrowers and an assignment of any shareholder
or intra-group loans to the Borrowers and the Restricted Equity Deposit
Account Security Deed in respect of the Restricted Equity Deposit
Account.
|
IT IS AGREED as
follows:
|
1
|
INTERPRETATION
|
|
1.1
|
Defined
expressions. Words and expressions defined in the Loan
Agreement shall have the same meanings when used in this Agreement unless
the context otherwise requires.
|
|
1.2
|
Definitions. In
this Agreement, unless the contrary intention
appears:
|
“Additional Fee
Letter” means any letter or letters dated on or about the date
of this Agreement between the Borrowers and any of the Creditor Parties in
respect of any additional fees;
“Amended and Restated Loan
Agreement” means the Loan Agreement as amended and restated by
this Agreement in the form set out in Appendix 1;
“Corporate Guarantee
Supplements” means letters supplemental to each of the
Corporate Guarantee and the New Corporate Guarantee executed or to be executed
by the Corporate Guarantor and the New Corporate Guarantor for respectively in
favour of the Security Trustee substantially in the forms set out in Appendix
2;
“Effective
Date” means the date on which the Agent notifies the Borrowers
and the Creditor Parties that the conditions precedent in Clause 3 have been fulfilled;
“Existing Finance
Documents” means the Finance Documents which have been
executed prior to the date hereof;
“Existing
Mortgages” means:
|
(a)
|
a
first preferred Panamanian ship mortgage dated 23 September 2009
preliminarily registered at the Public Registry Office, Microfilm
(Mercantile) Section, at Microjacket N-33447, Document No. 1652171 by
which Argyle Maritime Corp. mortgaged the vessel “ROCKAWAY BELLE” to and
in favour of the Security Trustee on the terms and conditions therein
contained; and
|
|
(b)
|
a
first preferred Panamanian ship mortgage dated 26 March 2010 preliminarily
registered at the Public Registry Office, Microfilm (Mercantile) Section,
at Microjacket N-34102, Document No. 1748208 by which Xxxxx Maritime Corp.
mortgaged the vessel “DAKOTA PRINCESS” to and in favour of the Security
Trustee on terms and conditions therein
contained;
|
“Loan
Agreement” means the loan agreement dated 29 March 2007 as
referred to in Recital (A);
“Master
Agreement” means the master agreement dated 29 March 2007 as
amended and supplemented from time to time and as referred to in
Recital (B);
“Mortgage Addendum” or “Mortgage
Addenda” means in relation to each Existing Mortgage, an
addendum to the Existing Mortgage, executed or to be executed by the relevant
Borrower in favour of the Security Trustee substantially in the form set out in
Appendix 3 (or in such other form as the Agent may approve or
require);
“Restricted Equity Deposit
Account” means an account in the name of the Borrowers with
the Agent at Shipping Business Centre, 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
designated with such designation as the Agent may allocate upon its opening or
any other account (with that or another office of the Agent or with a bank or
financial institution other than the Agent) which is designated by the Agent as
the Restricted Equity Deposit Account for the purposes of this
Agreement;
“Restricted Equity Deposit Account
Security Deed” means a deed creating security in respect of
the Restricted Equity Deposit Account made or to be made by and between the
Borrowers and the Security Trustee in the form set out in Appendix 5 or in such
other form as the Borrowers and the Agent may agree;
“Shareholder” means
Xxxxxxxxx Holdings Ltd., a corporation incorporated under the laws of the
Xxxxxxxx Islands and having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH96960;
and
“Shares Security
Deed” means, in relation to each Borrower, a deed creating
security over the share capital of that Xxxxxxxx and including an assignment of
any shareholder loans made to the Borrowers to be executed by the Shareholder in
favour of the Security Trustee in the form set out in Appendix 4 or in such
other form as the Borrowers and the Agent may agree.
|
1.3
|
Application of construction and
interpretation provisions of Loan Agreement. Clauses
1.2, 1.5 and 1.6 of the Loan Agreement apply, with any necessary
modifications, to this Agreement.
|
|
2
|
AGREEMENT
OF ALL PARTIES TO THE AMENDMENT OF THE LOAN AGREEMENT, MASTER AGREEMENT
AND EXISTING FINANCE DOCUMENTS
|
|
2.1
|
Agreement of the parties to
this Agreement. The parties to this Agreement agree,
subject to and upon the terms and conditions of this
Agreement:
|
|
(a)
|
|
(b)
|
that
the Borrowers shall pay to the Agent on the Effective Date a restructuring
fee which in aggregate is equal to zero point five per cent (0.50%) of the
Total Commitment outstanding as at the Effective Date, such fee to be
distributed pro rata amongst the Lenders which have entered into this
Agreement.
|
|
2.2
|
Effective Date. The
agreement of the parties to this Agreement contained in Clause 2.1 shall have effect on and from the Effective
Date.
|
|
2.3
|
Amounts drawn down under Loan A
and Loan B and repayments in respect of Loan A and Loan
B. On the Drawdown Date in respect of the Loan A
Delivery Advance the Borrowers had drawn down $25,000,000 in respect of
Loan A. With effect from the Effective Date, the repayment
schedule in respect of Loan A shall be as set out in Schedule
2A. On the Drawdown Date in respect of the Loan B Delivery
Advance the Borrowers had drawn down $24,587,500 in respect of Loan
B. With effect from the Effective Date, the repayment schedule
in respect of Loan B shall be as set out in Schedule
2B.
|
|
2.4
|
Amounts drawn down under Loan
C, Loan D, Loan E and Loan F. The Borrowers have as at
the date of this Agreement drawn down the amounts set out in Schedule 2C
in respect of Loan C, Loan D, Loan E and Loan
F.
|
|
3
|
CONDITIONS
PRECEDENT
|
|
3.1
|
|
3.2
|
Conditions
precedent. The conditions referred to in Clause 2.1 are that the Agent shall have received the
following documents and evidence in all respects in form and substance
satisfactory to the Agent and its lawyers on or before 14 May 2010 or such
later date as the Agent may agree with the Creditor Parties and the
Borrowers:
|
|
(a)
|
in
relation to the Borrowers, the New Corporate Guarantor, the Corporate
Guarantor and the Shareholder, documents of the kind specified in
paragraphs 2, 3, 4 and 5 of Part A of Schedule 3 of the Loan Agreement
with appropriate modifications to refer to this Agreement, the Additional
Fee Letter, the Mortgage Addenda, the Corporate Guarantee Supplements, the
Shares Security Deeds and the Restricted Equity Deposit Account Security
Deed insofar as each is a party
thereto;
|
|
(b)
|
a
duly executed original of this Agreement duly executed by the parties to
it;
|
|
(c)
|
a
duly executed original of the Additional Fee
Letter;
|
|
(d)
|
a
duly executed original of the Mortgage
Addenda;
|
|
(e)
|
a
duly executed original of the Corporate Guarantee
Supplements;
|
|
(f)
|
duly
executed originals of the Shares Security Deeds (and of each document to
be delivered pursuant to each of
them);
|
|
(g)
|
a
duly executed original of the Restricted Equity Deposit Account Security
Deed (and of each document to be delivered pursuant to
it);
|
|
(h)
|
documentary
evidence that each Mortgage Addendum has been duly recorded against the
relevant Ship as a valid addendum to the relevant Existing Mortgage over
that Ship according to the laws of
Panama;
|
|
(i)
|
evidence
that each Lender which has entered into this Agreement has received the
fee payable to it pursuant to Clause 2.1(b);
|
|
(j)
|
documentary
evidence that the agent for service of process named in Clause 31 of the
Loan Agreement has accepted its appointment in respect of the Shares
Security Deeds and the Restricted Equity Deposit Account Security Deed;
and
|
|
(k)
|
any
further opinions, consents, agreements and documents in connection with
this Agreement, the Additional Fee Letter, the Mortgage Addenda, the
Corporate Guarantee Supplements, the Shares Security Deeds, the Restricted
Equity Deposit Account Security Deed and the Finance Documents which the
Agent may reasonably request by notice to the Borrowers prior to the
Effective Date.
|
|
4
|
REPRESENTATIONS
AND WARRANTIES
|
|
4.1
|
Repetition of Loan Agreement
representations and warranties. The Borrowers represent
and warrant to the Agent that the representations and warranties in clause
10 of the Loan Agreement, as amended and restated by this Agreement and
updated with appropriate modifications to refer to this Agreement and,
where appropriate, the Mortgage Addendum, remain true and not misleading
if repeated on the date of this Agreement with reference to the
circumstances now existing.
|
|
4.2
|
Repetition of representations
and warranties under Existing Finance Documents. The
Borrowers represent and warrant to the Agent that the representations and
warranties in the Existing Finance Documents to which they are a party, as
amended and restated by this Agreement and updated with appropriate
modifications to refer to this Agreement and, where appropriate, the
Mortgage Addendum, remain true and not misleading if repeated on the date
of this Agreement with reference to the circumstances now
existing.
|
|
5
|
AMENDMENT
OF LOAN AGREEMENT, MASTER AGREEMENT AND EXISTING FINANCE
DOCUMENTS
|
|
5.1
|
Amendments
to Loan Agreement
|
|
(a)
|
With
effect on and from the Effective Date the Loan Agreement shall be, and
shall be deemed by this Agreement to be, amended and restated in the form
of the Amended and Restated Loan
Agreement.
|
|
(b)
|
As
so amended and restated pursuant to (a) above, the Loan Agreement shall
continue to be binding on each of the parties to it in accordance with its
terms.
|
|
5.2
|
Amendments to Master
Agreement. With effect on and from the Effective Date
the Master Agreement shall be, and shall be deemed by this Agreement to
be, amended so that the definition of, and references throughout to, the
Loan Facility and the Credit Support Documents shall be construed as if
the same referred to the Loan Agreement and those Credit Support Documents
as amended and restated or supplemented by this Agreement and the Mortgage
Addendum.
|
|
5.3
|
Amendments to Existing Finance
Documents. With effect on and from the Effective Date
each of the Existing Finance Documents (other than the Existing Mortgages
which are amended and supplemented by the Mortgage Addenda) shall be, and
shall be deemed by this Agreement to be, amended as
follows:
|
|
(a)
|
the
definition of, and references throughout each of the Existing Finance
Documents to, the Loan Agreement, the Master Agreement and any of the
Existing Finance Documents shall be construed as if the same referred to
the Loan Agreement, the Master Agreement and those Existing Finance
Documents as amended and restated or supplemented by this
Agreement;
|
|
(b)
|
by
construing references throughout each of the Existing Finance Documents to
“the Finance Documents” and other like expressions as if the same included
the Additional Fee Letter and the Corporate Guarantee
Supplements;
|
|
(c)
|
the
definition of, and references throughout each of the Existing Finance
Documents to, the Existing Mortgages, shall be construed as if the same
referred to the Existing Mortgages as amended and supplemented by the
Mortgage Addenda; and
|
|
(d)
|
by
construing references throughout each of the Existing Finance Documents to
“this Agreement”, “this Deed”, “hereunder” and other
like expressions as if the same referred to such Existing Finance
Documents as amended and supplemented by this
Agreement.
|
|
5.4
|
The Master Agreement and the
Existing Finance Documents to remain in full force and
effect. The Master Agreement and the Existing Finance
Documents shall remain in full force and effect, as amended
by:
|
|
(b)
|
such
further or consequential modifications as may be necessary to give full
effect to the terms of this
Agreement.
|
|
6
|
FURTHER
ASSURANCES
|
|
6.1
|
Borrowers’ obligations to
execute further documents etc. The Borrowers
shall:
|
|
(a)
|
execute
and deliver to the Agent (or as it may direct) any assignment, mortgage,
power of attorney, proxy or other document, governed by the law of England
or such other country as the Agent may, in any particular case,
specify;
|
|
(b)
|
effect
any registration or notarisation, give any notice or take any other
step;
|
which the
Agent may, by notice to the Borrowers, reasonably specify for any of the
purposes described in Clause 6.2 or for any similar
or related purpose.
|
6.2
|
Purposes of further
assurances. Those purposes
are:
|
|
(a)
|
validly
and effectively to create any Security Interest or right of any kind which
the Agent intended should be created by or pursuant to the Loan Agreement
or any other Finance Document, each as amended and restated or
supplemented by this Agreement, or by the Mortgage Addenda;
and
|
|
(b)
|
implementing
the terms and provisions of this
Agreement.
|
|
6.3
|
Terms of further
assurances. The Agent may specify the terms of any
document to be executed by the Borrowers under Clause 6.1, and those terms may include any covenants,
powers and provisions which the Agent considers appropriate to protect its
interests.
|
|
7
|
NOTICES
|
|
7.1
|
General. The
provisions of clause 28 (Notices) of the Loan
Agreement, as amended and restated by this Agreement, shall apply to this
Agreement as if they were expressly incorporated in this Agreement with
any necessary modifications.
|
|
8
|
SUPPLEMENTAL
|
|
8.1
|
Counterparts. This
Agreement may be executed in any number of
counterparts.
|
|
8.2
|
Third party
rights. Other than a Creditor Party, no person who is
not a party to this Agreement has any right under the Contracts (Rights of
Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of
this Agreement.
|
|
9
|
LAW
AND JURISDICTION
|
|
9.1
|
Governing
law. This Agreement and any non-contractual obligations
arising out of or in connection with it shall be governed by and construed
in accordance with English law.
|
|
9.2
|
Incorporation of the Loan
Agreement provisions. The provisions of clause 31 (Law and jurisdiction) of
the Loan Agreement, as amended and restated by this Agreement, shall apply
to this Agreement as if they were expressly incorporated in this Agreement
with any necessary modifications.
|
THIS AGREEMENT has been duly
executed as a deed on the date stated at the beginning of this
Agreement.
SCHEDULE
1
LENDERS
|
Lender
|
Lending
Office
|
|
The
Royal Bank of Scotland plc
|
Shipping
Business Centre
0-00
Xxxxx Xxxxx Xxxxxx
Xxxxxx
XX0X 0XX
Fax
No: +
44 207 085 7142
Attn:
Transaction and Portfolio Management
|
|
Citibank,
N.A.
|
000
Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx
XX00000
XXX
Fax
No: + 0 000 000 0000
Attn:
Xxxxxxx Xxxxxx
|
|
Landesbank
Hessen-Thüringen Girozentrale
|
000
Xxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, XX 000000-0000
XXX
Fax
No: x0 000 000 0000
Attn:
Corporate Finance/ Portfolio Management
|
|
Norddeutsche
Landesbank Girozentrale
|
Ship
and Aircraft Finance Department
Xxxxxxxxxxxxxx
00
00000
Xxxxxxxx, Xxxxxxx
Fax
No: x00 000 000 0000
Attn:
International Shipping Group II - Xxxxxxxxx Xxxxxxxx
|
|
Alliance
& Leicester Commercial Finance plc
|
000 Xxxxxxxxx
Xxxxxxxxxx
X0
0XX
Fax
No: + 00 000 000 0000
Attn
Corporate Administration Manager
|
|
Bank
of America, N.A.
|
Bank
of America
000
Xxxxxxx Xxxxxx
Xxxxxx
XX 00000
Fax
No: x000000 0000
Attn:
Transportation Division - Credit
Products
|
SCHEDULE
2A
LOAN
A REPAYMENT SCHEDULE
|
(D)Date
|
(E)Amortization
|
(F)Principal Amount Outstanding
after Amortization Payment
|
|
(G) Final
draw
date: 9
September 2009
|
(H)-
|
(I)$25,000,000
|
|
(J) September
2009
|
(K)$417,500
|
(L)$24,582,500
|
|
(M) March
2010
|
(N)$417,500
|
(O)$24,165,000
|
|
(P) June
2010
|
(Q)$417,500
|
(R)$23,747,500
|
|
(S) September
2010
|
(T)$417,500
|
(U)$23,330,000
|
|
(V) December
2010
|
(W)$417,500
|
(X)$22,912,500
|
|
(Y) March
2011
|
(Z)$417,500
|
(AA)$22,495,000
|
|
(BB) June
2011
|
(CC)$417,500
|
(DD)$22,077,500
|
|
(EE) September
2011
|
(FF)$417,500
|
(GG)$21,660,000
|
|
(HH) December
2011
|
(II)$417,500
|
(JJ)$21,242,500
|
|
(KK) March
2012
|
(LL)$417,500
|
(MM)$20,825,000
|
|
(NN) June
2012
|
(OO)$417,500
|
(PP)$20,407,500
|
|
(QQ) September
2012
|
(RR)$417,500
|
(SS)$19,990,000
|
|
(TT) December
2012
|
(UU)$417,500
|
(VV)$19,572,500
|
|
(WW) March
2013
|
(XX)$417,500
|
(YY)$19,155,000
|
|
(ZZ) June
2013
|
(AAA)$417,500
|
(BBB)$18,737,500
|
|
(CCC) September
2013
|
(DDD)$417,500
|
(EEE)$18,320,000
|
|
(FFF) December
2013
|
(GGG)$417,500
|
(HHH)$17,902,500
|
|
(III) March
2014
|
(JJJ)$417,500
|
(KKK)$17,485,000
|
|
(LLL) June
2014
|
(MMM)$417,500
|
(NNN)$17,067,500
|
|
(OOO) September
2014
|
(PPP)$17,067,500
|
(QQQ)$0
|
SCHEDULE
2B
LOAN
B REPAYMENT SCHEDULE
|
(RRR)Date
|
(SSS)Amortization
|
(TTT)Principal Amount Outstanding
after Amortization Payment
|
|
(UUU) Final
draw
date: 23
March 2010
|
(VVV)-
|
(WWW)$24,587,500
|
|
(XXX) March
2010
|
(YYY)$417,500
|
(ZZZ)$24,170,000
|
|
(AAAA) June
2010
|
(BBBB)$417,500
|
(CCCC)$23,752,500
|
|
(DDDD) September
2010
|
(EEEE)$417,500
|
(FFFF)$23,335,000
|
|
(GGGG) December
2010
|
(HHHH)$417,500
|
(IIII)$22,917,500
|
|
(JJJJ) March
2011
|
(KKKK)$417,500
|
(LLLL)$22,500,000
|
|
(MMMM) June
2011
|
(NNNN)$417,500
|
(OOOO)$22,082,500
|
|
(PPPP) September
2011
|
(QQQQ)$417,500
|
(RRRR)$21,665,000
|
|
(SSSS) December
2011
|
(TTTT)$417,500
|
(UUUU)$21,247,500
|
|
(VVVV) March
2012
|
(WWWW)$417,500
|
(XXXX)$20,830,000
|
|
(YYYY) June
2012
|
(ZZZZ)$417,500
|
(AAAAA)$20,412,500
|
|
(BBBBB) September
2012
|
(CCCCC)$417,500
|
(DDDDD)$19,995,000
|
|
(EEEEE) December
2012
|
(FFFFF)$417,500
|
(GGGGG)$19,577,500
|
|
(HHHHH) March
2013
|
(IIIII)$417,500
|
(JJJJJ)$19,160,000
|
|
(KKKKK) June
2013
|
(LLLLL)$417,500
|
(MMMMM)$18,742,500
|
|
(NNNNN) September
2013
|
(OOOOO)$417,500
|
(PPPPP)$18,325,000
|
|
(QQQQQ) December
2013
|
(RRRRR)$417,500
|
(SSSSS)$17,907,500
|
|
(TTTTT) March
2014
|
(UUUUU)$417,500
|
(VVVVV)$17,490,000
|
|
(WWWWW) June
2014
|
(XXXXX)$417,500
|
(YYYYY)$17,072,500
|
|
(ZZZZZ) September
2014
|
(AAAAAA)$17,072,500
|
(BBBBBB)$0
|
SCHEDULE
2C
AMOUNTS
DRAWN DOWN IN RESPECT OF LOAN C, LOAN D, XXXX E AND LOAN F
|
(CCCCCC)Loan
|
(DDDDDD)Amount drawn down to finance
first stage payment
|
(EEEEEE)Amount drawn down to finance
second stage payment
|
(FFFFFF)Amount drawn down to finance
third stage payment
|
(GGGGGG)Amount drawn down to finance
fourth stage payment
|
(HHHHHH)Amount drawn down to finance
final delivery payment
|
|
(IIIIII)Loan
C
|
(JJJJJJ)$5,000,000
|
(KKKKKK)$5,000,000
|
(LLLLLL)$5,000,000
|
(MMMMMM)$5,000,000
|
(NNNNNN)$0
(OOOOOO)
|
|
(PPPPPP)Loan D
|
(QQQQQQ)$5,000,000
|
(RRRRRR)$5,000,000
|
(SSSSSS)$5,000,000
|
(TTTTTT)$0
|
(UUUUUU)$0
(VVVVVV)
|
|
(WWWWWW)Loan E
|
(XXXXXX)$5,000,000
|
(YYYYYY)$5,000,000
|
(ZZZZZZ)$4,587,500
|
(AAAAAAA)$5,000,000
|
(BBBBBBB)$0
(CCCCCCC)
|
|
(DDDDDDD)Loan F
|
(EEEEEEE)$5,000,000
|
(FFFFFFF)$5,000,000
|
(GGGGGGG)$5,000,000
|
(HHHHHHH)$0
|
(IIIIIII)$0
(JJJJJJJ)
|
EXECUTION
PAGES
|
BORROWERS
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
ARGYLE
MARITIME CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
XXXXX
MARITIME CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
DORCHESTER
MARITIME CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
LONGWOODS MARITIME
CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
XxXXXXX
MARITIME CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
SUNSWYCK
MARITIME CORP.
|
)
|
|
|
acting
by Xxxxx Xxxx
|
)
|
/s/ Xxxxx Xxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
LENDERS
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE
ROYAL BANK OF SCOTLAND PLC
|
)
|
|
|
PLC
|
)
|
|
|
acting
by Xxxxxx Xxxxxxx Xxxxxx
|
)
|
/s/ Xxxxxx Xxxxxxx Xxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ X.X. Xxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
CITIBANK,
N.A.
|
)
|
|
|
acting
by Xxxx XxXxxxxx
|
)
|
/s/ Xxxx XxXxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxx Xxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
LANDESBANK
HESSEN-THÜRINGEN
|
)
|
|
|
GIROZENTRALE
|
)
|
|
|
acting
by
|
)
|
/s/ Xxxxx X. Xxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of:
|
)
|
/s/ Xxx Xxxxxxxxxx |
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
NORDDEUTSCHE
LANDESBANK
|
)
|
|
|
GIROZENTRALE
|
)
|
|
|
acting
by Xxxxxxx Xxxxxxxx / Xxxxxxxxx Xxxxxxx
|
)
|
/s/ Xxxxxxx Xxxxxxxx /s/ Xxxxxxxxx Xxxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxxxx Xxxxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
ALLIANCE
& LEICESTER
|
)
|
|
|
COMMERCIAL
FINANCE PLC
|
)
|
|
|
acting
by Xxxx XxXxxxxx
|
)
|
/s/ Xxxx XxXxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxxx Xxxxxx
|
)
|
|
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
BANK OF AMERICA,
N.A.
|
)
|
|
|
acting
by Xxxxxx X Xxxxxxx
|
)
|
/s/ Xxxxxx X. Xxxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxxxx Xxxxxxxx
|
)
|
|
|
MANDATED
LEAD ARRANGER
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE ROYAL BANK OF SCOTLAND
PLC
|
)
|
|
|
acting
by Xxxxxx X. Xxxxxxx
|
)
|
/s/ Xxxxxx X. Xxxxxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
BOOKRUNNER
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE
ROYAL BANK OF SCOTLAND PLC
|
)
|
|
|
acting
by Xxxxxx X. Xxxxxxx
|
)
|
/s/ Xxxxxx X. Xxxxxxx |
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
AGENT
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE
ROYAL BANK OF SCOTLAND PLC
|
)
|
|
|
acting
by
|
)
|
|
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of:
|
)
|
|
|
SECURITY
TRUSTEE
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE
ROYAL BANK OF SCOTLAND PLC
|
)
|
|
|
acting
by Xxxxxx X. Xxxxxxx
|
)
|
/s/ Xxxxxx X. Xxxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
|
SWAP
BANK
|
||
|
EXECUTED and DELIVERED as a DEED
|
)
|
|
|
by
|
)
|
|
|
THE
ROYAL BANK OF SCOTLAND PLC
|
)
|
|
|
acting
by Xxxxxx X. Xxxxxxx
|
)
|
/s/ Xxxxxx X. Xxxxxxx |
|
)
|
||
|
its
duly authorised attorney-in-fact
|
)
|
|
|
in
the presence of: /s/ Xxxxx Xxxxxxx
|
)
|
|
APPENDIX
1
FORM
OF AMENDED AND RESTATED LOAN AGREEMENT AS AMENDED
Dated as
of 29 March 2007
ARGYLE
MARITIME CORP.
XXXXX
MARITIME CORP.
DORCHESTER
MARITIME CORP.
LONGWOODS
MARITIME CORP.
XxXXXXX
MARITIME CORP.
SUNSWYCK
MARITIME CORP.
as Joint
and Several Borrowers
– and
–
THE
BANKS AND FINANCIAL INSTITUTIONS
listed
in Schedule 1
as
Lenders
– and
–
THE
ROYAL BANK OF SCOTLAND plc
as
Mandated Lead Arranger
– and
–
THE
ROYAL BANK OF SCOTLAND plc
as
Bookrunner, Agent, Security Trustee and Swap Bank
LOAN
AGREEMENT
relating
to a term loan facility of US$150,000,000
INDEX
|
Clause
|
Page
|
|
|
1
|
INTERPRETATION
|
1
|
|
2
|
LOAN
FACILITy
|
17
|
|
3
|
POSITION
OF THE LENDERS AND THE SWAP BANK
|
20
|
|
4
|
DRAWDOWN
|
21
|
|
5
|
INTEREST
|
22
|
|
6
|
INTEREST
PERIODS
|
24
|
|
7
|
DEFAULT
INTEREST
|
25
|
|
8
|
REPAYMENT
AND PREPAYMENT
|
26
|
|
9
|
CONDITIONS
PRECEDENT
|
28
|
|
10
|
REPRESENTATIONS
AND WARRANTIES
|
30
|
|
11
|
GENERAL
UNDERTAKINGS AND FINANCIAL COVENANTS
|
32
|
|
12
|
CORPORATE
UNDERTAKINGS
|
37
|
|
13
|
INSURANCE
|
38
|
|
14
|
SHIP
COVENANTS
|
43
|
|
15
|
SECURITY
COVER
|
46
|
|
16
|
PAYMENTS
AND CALCULATIONS
|
47
|
|
17
|
APPLICATION
OF RECEIPTS
|
49
|
|
18
|
EARNINGS
ACCOUNT AND XXXXXXX EARNINGS ACCOUNT
|
50
|
|
19
|
EVENTS
OF DEFAULT
|
51
|
|
20
|
FEES
AND EXPENSES
|
56
|
|
21
|
INDEMNITIES
|
58
|
|
22
|
NO
SET-OFF OR TAX DEDUCTION
|
60
|
|
23
|
ILLEGALITY,
ETC
|
61
|
|
24
|
INCREASED
COSTS
|
61
|
|
25
|
SET‑OFF
|
63
|
|
26
|
TRANSFERS
AND CHANGES IN LENDING OFFICES
|
64
|
|
27
|
VARIATIONS
AND WAIVERS
|
67
|
|
28
|
NOTICES
|
67
|
|
29
|
JOINT
AND SEVERAL LIABILITY
|
70
|
|
30
|
SUPPLEMENTAL
|
71
|
|
31
|
LAW
AND JURISDICTION
|
71
|
|
SCHEDULE
1 LENDERS
|
73
|
|
|
SCHEDULE
2 DRAWDOWN NOTICE
|
74
|
|
|
SCHEDULE
3 CONDITION PRECEDENT DOCUMENTS
|
75
|
|
|
SCHEDULE
4 TRANSFER CERTIFICATE
|
80
|
|
|
SCHEDULE
5 REPAYMENT INSTALMENTS
|
84
|
|
|
SCHEDULE
6 MANDATORY COST FORMULA
|
86
|
|
|
schedule
7 Classification of SHIPS
|
88
|
|
|
SCHEDULE
8 FINANCIAL COVENANTS
|
89
|
|
|
SCHEDULE
9 FORM OF COMPLIANCE CERTIFICATE
|
98
|
|
|
EXECUTION
PAGES
|
100
|
|
THIS LOAN AGREEMENT is made as
of 29 March 2007
BETWEEN:
|
(1)
|
ARGYLE MARITIME CORP.,
XXXXX MARITIME
CORP., DORCHESTER
MARITIME CORP., LONGWOODS MARITIME
CORP., XxXXXXX
MARITIME CORP. and SUNSWYCK MARITIME CORP.
as Joint and Several
Borrowers;
|
|
(2)
|
THE BANKS AND FINANCIAL
INSTITUTIONS listed in Schedule 1, as Lenders;
|
|
(3)
|
THE ROYAL BANK OF
SCOTLAND plc as Mandated Lead
Arranger;
|
|
(4)
|
THE ROYAL BANK OF SCOTLAND
plc as Bookrunner;
|
|
(5)
|
THE ROYAL BANK OF SCOTLAND
plc as Agent;
and
|
|
(6)
|
THE ROYAL BANK OF SCOTLAND
plc as Swap
Bank.
|
BACKGROUND
|
(A)
|
The
Lenders have agreed to make available to the Borrowers a term loan
facility of up to $150,000,000 for the purpose of part financing the
acquisition cost of each of six newbuilding multipurpose carriers being
built at Yahua Shipyard, China having hull nos. NYHS200720, NYHS200721,
NYHS200722, NYHS200723, NYHS200724 and
NYHS200725.
|
|
(B)
|
The
Swap Bank has agreed to enter into interest rate swap transactions with
the Borrowers from time to time to hedge the Borrowers’ exposure under
this Agreement to interest rate
fluctuations.
|
|
(C)
|
The
Lenders and the Swap Bank have agreed to share in the security to be
granted to the Security Trustee pursuant to this Agreement on the terms
described herein.
|
IT IS AGREED as
follows:
|
1
|
INTERPRETATION
|
|
1.1
|
Definitions. Subject
to Clause 1.5, in this
Agreement:
|
“Account Security
Deed” means a deed creating security in respect of the Standby
Earnings Account made or to be made by and between the Borrowers, TBS Pacific
Liner and the Security Trustee, in such form as the Borrowers, TBS Pacific Liner
and the Agent may agree;
“Advance” means the
principal amount of each borrowing of a portion of the Commitments by the
Borrowers under this Agreement;
“Affected
Lender” has the meaning given in Clause 5.7;
“Agency and Trust
Agreement” means the agency and trust agreement executed or to
be executed between the Borrowers, the Lenders, the Agent and the Security
Trustee in such form as the Borrowers and the Agent may agree;
“Agent” means The
Royal Bank of Scotland plc, acting in such capacity through its office at Level
0, 000 Xxxxxxxxxxx, Xxxxxx XX0X 0XX, or any successor of it appointed under
clause 5 of the Agency and Trust Agreement;
“Approved
Managers” means, Roymar Ship Management Inc., a company
incorporated under the laws of New York and having a place of business at 000
Xxxx Xxxxxx Xxxxxx Xxxx, Xxxxxxx, Xxx Xxxx 00000, XXX or such other company
which the Agent may, with the authorisation of the Majority Lexxxxx, approve
from time to time as the manager of the Ships;
“Availability
Period” means the period commencing on the date of this
Agreement and ending on:
|
(a)
|
(i) in
respect of Loan A, 30 September 2009 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
|
(ii)
|
in
respect of Loan B, 31 March 2010 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
|
(iii)
|
in
respect of Loan C, 31 August 2010 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
|
(iv)
|
in
respect of Loan D, 30 April 2011 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
|
(v)
|
in
respect of Loan E, 31 January 2011 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
|
(vi)
|
in
respect of Loan F, 31 August 2011 (or such later date as the Agent may,
with the authorisation of the Majority Lenders, agree with the
Borrowers);
|
|
(b)
|
if
earlier, the date on which the Total Commitments are fully borrowed,
cancelled or terminated;
|
“Available
Commitment” means, in relation to a Lender and at any time,
its Commitment less its Contribution at that time (and “Total Available
Commitments” means the aggregate of the Available Commitments
of all the Lenders);
“Bank of America
Facilities” means the credit
facilities made available to Albermarle Maritime Corp and others pursuant to the
amended and restated credit agreement dated as of 28 March 2008 (as amended and
in effect from time to time) and made between Albermarle Maritime Corp., the New
Corporate Guarantor, Bank of America, N.A and others;
“Bareboat
Charter” means, in relation to each Ship, the bareboat charter
made or to be made between the relevant Borrower and the Bareboat Charterer in
respect of such Ship;
“Bareboat
Charterer” means a company to be nominated by the Borrowers
which is incorporated in the Philippines and owned or controlled by Aboitiz
Jebsen, or such other company as the Borrowers may nominate with the Agent’s
approval which is not to be unreasonably withheld;
“Bookrunner” means The Royal
Bank of Scotland plc, acting in such capacity through Loan Markets, 3rd Floor,
000 Xxxxxxxxxxx, Xxxxxx XX0X 0XX;
“Borrower A” means
Argyle Maritime Corp., being a corporation organised and existing under the laws
of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrower B” means
Xxxxx Maritime Corp., being a corporation organised and existing under the laws
of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrower C” means
Dorchester Maritime Corp., being a corporation organised and existing under the
laws of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrower D” means
Longwoods Maritime Corp., being a corporation organised and existing under the
laws of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrower E” means
XxXxxxx Maritime Corp., being a corporation organised and existing under the
laws of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrower F” means
Sunswyck Maritime Corp., being a corporation organised and existing under the
laws of the Xxxxxxxx Islands and having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH
96960;
“Borrowers” means
together Borrower A, Borrower B, Borrower C, Borrower D, Borrower E and Borrower
F and, in the singular, means any of them;
“Builder” means
Nantong Yahua Shipbuilding Co., Ltd a corporation organised and existing under
the laws of the People’s Republic of China, having its registered office at 0#
Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx Xxxxxxx X.X. 000000, the People’s Republic of
China;
“Business Day” means
a day on which banks are open for general business in Dublin, Frankfurt, London
and Paris and, in respect of a day on which a payment is required to be made
under a Finance Document, also in New York City;
“China
Communications” means China Communications Construction
Company Ltd, a corporation organised and existing under the laws of the People’s
Republic of China, having its registered office at No. B88, An Ding Men Wai
Street, Beijing 100011, The People’s Republic of China;
“Classification” means, in
relation to a Ship, the classification set opposite its name in Schedule
7;
“Commitment” means
in relation to a Lender, the amount set opposite its name in Schedule 1, or, as
the case may be require, the amount specified in the relevant Transfer
Certificate, as that amount may be reduced, cancelled or terminated in
accordance with this Agreement (and “Total Commitments” means the
aggregate of the Commitments of all the Lenders);
“Confirmation” in relation to
any continuing Designated Transaction, has the meaning given in the Master
Agreement;
“Contract
Price” means, in relation to each Ship, the aggregate amount
payable to the Seller pursuant to the terms of the Shipbuilding Contract for
such Ship being in each case $35,420,000;
“Contractual
Currency” has the meaning given in Clause 21.4;
“Contribution” means,
in relation to a Lender the part of the Loans which is owing to that Lender (and
“Total Contributions”
means the aggregate of the Contributions of all the Lenders);
“Corporate
Guarantee” means the corporate guarantee executed or to be
executed by the Corporate Guarantor in favour of the Security Trustee, in such
form as the Corporate Guarantor and the Agent may agree;
“Corporate
Guarantor” means TBS International Limited, a company
incorporated under the laws of Bermuda having its principal office at Suite 000,
Xxxxxxxx Xxxxxxxx, Xxx Xxxxxxxx Xxxx, Xxxxxxxx XX00, Xxxxxxx;
“Creditor
Party” means the Agent, the Security Trustee, any Lender or
the Swap Bank, whether as at the date of this Agreement or at any later
time;
“Delivery
Advances” means together Loan A Delivery Advance, Loan B
Delivery Advance, Loan C Delivery Advance, Loan D Delivery Advance, Loan E
Delivery Advance and Loan F Delivery Advance (as each such expression is defined
in Clause 2.1) and, in the singular, means any of
them;
“Delivery
Date” means, in relation to each Ship, the date of delivery of
such Ship by the Seller to the relevant Borrower under the relevant Shipbuilding
Contract;
“Designated
Transaction” means a Transaction which fulfils the following
requirements:
|
(a)
|
it
is entered into by the Borrowers pursuant to the Master Agreement with the
Swap Bank; and
|
|
(b)
|
its
purpose is the hedging of the Borrowers’ exposure under this Agreement to
fluctuations in LIBOR arising from the funding of the Loans (or any part
thereof) for a period expiring no later than the final Repayment
Date;
|
“Dispute” has the meaning given
to that term in Clause 31.6;
“Dollars” and “$” means the lawful
currency for the time being of the United States of America;
“Drawdown
Date” means, in relation to an Advance, the date requested by
the Borrowers for the Advance to be made, or (as the context requires) the date
on which the Advance is actually made;
“Drawdown
Notice” means a notice in the form set out in Schedule 2 (or
in any other form which the Agent approves or reasonably requires);
“Earnings” means, in
relation to a Ship, all moneys whatsoever which are now, or later become,
payable (actually or contingently) to the relevant Borrower owning the Ship or
the Security Trustee and which arise out of the use or operation of the Ship,
including (but not limited to):
|
(a)
|
all
freight, hire and passage moneys, compensation payable to the Borrower
owning the Ship in the event of requisition of the Ship for hire,
remuneration for salvage and towage services, demurrage and detention
moneys and damages for breach (or payments for variation or termination)
of any charterparty or other contract for the employment of the
Ship;
|
|
(b)
|
all
moneys which are at any time payable under Insurances in respect of loss
of earnings; and
|
|
(c)
|
if
and whenever the Ship is employed on terms whereby any moneys falling
within paragraphs (a) or (b) are pooled or shared with any other person,
that proportion of the net receipts of the relevant pooling or sharing
arrangement which is attributable to the
Ship;
|
“Earnings
Account” means an account in the name of TBS Pacific Liner
with the Agent at Shipping Business Centre, 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X
0XX designated with such designation as the Agent may allocate upon its opening
or any other account (with that or another office of the Agent or with a bank or
financial institution other than the Agent) which is designated by the Agent as
the Earnings Account for the purposes of this Agreement;
“Environmental Claim”
means:
|
(a)
|
any
claim by any governmental, judicial or regulatory authority which arises
out of an Environmental Incident or which relates to an alleged breach of,
or non-compliance with, any Environmental Law;
or
|
|
(b)
|
any
claim by any other person which relates to an Environmental Incident or to
an alleged Environmental Incident,
|
and
“claim” means a claim
for damages, compensation, fines, penalties or any other payment of any kind
whether or not similar to the foregoing; an order or direction to take, or not
to take, certain action or to desist from or suspend certain action; and any
form of enforcement or regulatory action, including the arrest or attachment of
any asset;
“Environmental
Incident” means:
|
(a)
|
any
release of Environmentally Sensitive Material from a Ship;
or
|
|
(b)
|
any
incident in which Environmentally Sensitive Material is released from a
vessel other than a Ship and which involves a collision between a Ship and
such other vessel or some other incident of navigation or operation, in
either case, in connection with which a Ship is actually or potentially
liable to be arrested, attached, detained or injuncted and/or a Ship
and/or a Borrower and/or any Approved Manager of a Ship is at fault or
allegedly at fault or otherwise liable to any legal or administrative
action; or
|
|
(c)
|
any
other incident in which Environmentally Sensitive Material is released
otherwise than from a Ship and in connection with which a Ship is actually
or potentially liable to be arrested and/or where a Borrower and/or any
Approved Manager of a Ship is at fault or allegedly at fault or otherwise
liable to any legal or administrative
action;
|
“Environmental
Law” means any law relating to pollution or protection of the
environment, to the carriage of Environmentally Sensitive Material or to actual
or threatened releases of Environmentally Sensitive Material;
“Environmentally Sensitive
Material” means oil, oil products and any other substance
(including any chemical, gas or other hazardous or noxious substance) which is
(or is capable of being or becoming) polluting, toxic or hazardous;
“Event of
Default” means any of the events or circumstances described in
Clause 19.1;
“Fee Letter” means any letter
or letters dated on or about the date of this Agreement between the Mandated
Lead Arranger and the Borrowers (or the Agent and the Borrowers) setting out any
of the fees referred to in Clause 20.1(a), (b) , (c), (d), (e), (f), (g) and (h), a letter dated 27 March 2009 between the
Borrowers and the Agent and any further letters in relation to fees between the
Borrowers and the Agent;
“Final Repayment Date” means 9
September 2014;
“Finance Documents”
means:
|
(a)
|
this
Agreement;
|
|
(b)
|
the
Agency and Trust Agreement;
|
|
(c)
|
the
Multiparty Deeds;
|
|
(d)
|
the
Mortgages;
|
|
(e)
|
the
Master Agreement;
|
|
(f)
|
the
Master Agreement Assignment;
|
|
(g)
|
the
Predelivery Security Assignments;
|
|
(h)
|
the
Corporate Guarantee;
|
|
(i)
|
the
New Corporate Guarantee;
|
|
(j)
|
the
Shares Security Deeds;
|
|
(k)
|
the
Account Security Deed;
|
|
(l)
|
the
Restricted Equity Deposit Account Security
Deed;
|
|
(m)
|
the
Fee Letter;
|
|
(n)
|
the
Intercreditor Agreement; and
|
|
(o)
|
any
other document (whether creating a Security Interest or not) which is
executed at any time by the Borrowers or any other person as security for,
or to establish any form of subordination or priorities arrangement in
relation to, any amount payable to the Creditor Parties under this
Agreement or any of the other documents referred to in this
definition;
|
“Financial
Indebtedness” means, in relation to a person (the “debtor”), a liability of the
debtor:
|
(a)
|
for
principal, interest or any other sum payable in respect of any moneys
borrowed or raised by the debtor;
|
|
(b)
|
under
any loan stock, bond, note or other security issued by the
debtor;
|
|
(c)
|
under
any acceptance credit, guarantee or letter of credit facility made
available to the debtor;
|
|
(d)
|
under
a financial lease, a deferred purchase consideration arrangement or any
other agreement having the commercial effect of a borrowing or raising of
money by the debtor (other than normal trade credit not exceeding 180
days);
|
|
(e)
|
under
any foreign exchange transaction, any interest or currency swap or any
other kind of derivative transaction entered into by the debtor or, if the
agreement under which any such transaction is entered into requires
netting of mutual liabilities, the liability of the debtor for the net
amount; or
|
|
(f)
|
under
a guarantee, indemnity or similar obligation entered into by the debtor in
respect of a liability of another person which would fall within
paragraphs (a) to (e) if the references to the debtor referred to the
other person;
|
“First Sub-Time Charter” means
in relation to each Ship, the time charter made or to be made between the Time
Charterer and the relevant Borrower in respect of such Ship;
“Guarantee Facility
Agreement” means the guarantee facility agreement of even date
herewith made between the Borrowers as obligors and the Issuing Bank relating to
a guarantee facility of $84,000,000;
“Insurances” means,
in relation to a Ship:
|
(a)
|
all
policies and contracts of insurance, including entries of the Ship in any
protection and indemnity or war risks association, which are effected in
respect of the Ship, its Earnings or otherwise in relation to it;
and
|
|
(b)
|
all
rights and other assets relating to, or derived from, any of the
foregoing, including any rights to a return of a
premium;
|
“Intercreditor
Agreement” means the intercreditor agreement executed or to be
executed between the Borrowers, the Security Trustee and the Issuing Bank in
such form as such parties may agree;
“Interest
Period” means a period determined in accordance with Clause 6;
“ISM Code” means the
International Safety Management Code (including the guidelines on its
implementation), adopted by the International Maritime Organisation Assembly as
Resolutions A.741 (18) and A.788 (19), as the same may be amended or
supplemented from time to time (and the terms “safety management system”,
“Safety Management
Certificate” and “Document of Compliance” have
the same meanings as are given to them in the ISM Code);
“ISPS Code” means the
International Ship and Port Facility Security Code adopted by the International
Maritime Organisation (as the same may be amended, supplemented or superseded
from time to time);
“ISSC” means a valid
and current International Ship Security Certificate issued under the ISPS
Code;
“Issuing Bank” means
The Royal Bank of Scotland plc acting as issuing bank under the Guarantee
Facility Agreement acting through the Shipping Business Centre, 0-00 Xxxxx Xxxxx
Xxxxxx, Xxxxxx XX0X 0XX;
“Joint Ventures” means the
following investment projects (details of which have separately been advised to
the Agent):
|
(a)
|
investments
and loans in relation to a joint venture in South Africa with ICM
Forwarding to form African Projects Logistics, a logistics provider for
the South African Medupi Power Station
Project;
|
|
(b)
|
investments
in relation to limestone mines in the Dominican Republic and
Jamaica;
|
|
(c)
|
investments
in relation to the LOG-STAR joint venture in Brazil which will/does
provide break bulk, bulk, liner and parcel services in the Brazilian
coastal cabotage trade
|
“Lender” means a
bank or financial institution listed in Schedule 1 and acting through its branch
indicated in Schedule 1 (or through another branch notified to the Agent under
Clause 26.14) or its transferee, successor or
assign;
“LIBOR” means, for
an Interest Period:
|
(a)
|
the
rate per annum equal to the offered quotation for deposits in Dollars for
a period equal to, or as near as possible equal to, the relevant Interest
Period which appears on REUTERS BBA Page LIBOR 01 at or about 11.00 a.m.
(London time) on the Quotation Date for that Interest Period (and, for the
purposes of this Agreement, “REUTERS BBA Page LIBOR 01” means the display
designated as “REUTERS BBA Page LIBOR 01” on the Reuters Money News
Service or such other page as may replace REUTERS BBA Page LIBOR 01 on
that service for the purpose of displaying rates comparable to that rate
or on such other service as may be nominated by the British Bankers’
Association as the information vendor for the purpose of displaying
British Bankers’ Association Interest Settlement Rates for Dollars);
or
|
|
(b)
|
if
no rate is quoted on REUTERS BBA Page LIBOR 01, the rate per annum
determined by the Agent to be the arithmetic mean (rounded upwards, if
necessary, to the nearest one-sixteenth of one per cent.) of the rates per
annum notified to the Agent by each Reference Bank as the rate at which
deposits in Dollars are offered to that Reference Bank by leading banks in
the London Interbank Market at that Reference Bank’s request at or about
11.00 a.m. (London time) on the Quotation Date for that Interest Period
for a period equal to that Interest Period and for delivery on the first
Business Day of it;
|
“Loan A” means the
five Advances referred to in Clause 2.1(i) or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan B” means the
five Advances referred to in Clause 2.1(ii) or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan C” means the
five Advances referred to in Clause 2.1(iii) or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan D” means the
five Advances referred to in Clause 2.1(iv) or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan E” means the
five Advances referred to in Clause 2.1(v) or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan F” means the
five Advances referred to in Clause 2.1(vi)or (as
the context requires) the principal amount thereof for the time being advanced
and outstanding under this Agreement;
“Loan
Facility” means, the loan facility of $150,000,000 made
available under this Agreement;
“Loans” means Loan
A, Loan B, Loan C, Loan D, Loan E and Loan F and, in the singular, means any of
them;
“Major
Casualty” means, in relation to a Ship, any casualty to the
Ship in respect of which the claim or the aggregate of the claims against all
insurers, before adjustment for any relevant franchise or deductible, exceeds
$500,000 or the equivalent in any other currency;
“Majority
Lenders” means:
|
(a)
|
before
an Advance has been made, Lenders whose Commitments total 66.66 per cent.
of the Total Commitments; and
|
|
(b)
|
after
an Advance has been made, Lexxxxx xhose Contributions total 66.66 per
cent. of the
Total Contributions;
|
“Mandated Lead
Arranger” means The Royal Bank of Scotland plc, acting in such
capacity through the Shipping Business Centre, 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx
XX0X 0XX;
“Mandatory
Cost” means the percentage rate per annum calculated by the
Agent in accordance with Schedule 6;
“Margin” means in
relation to each Loan five point zero per cent. (5.00%) per annum;
“Master
Agreement” means the master agreement (on the 1992 ISDA
(Multicurrency Crossborder) form) dated 29 March 2007 between the Borrowers and
the Swap Bank and includes all Designated Transactions from time to time entered
into and Confirmations from time to time exchanged under such master agreement
as the same may be amended, supplemented or the subject of one of more
assumption agreements;
“Master Agreement
Assignment” means the assignment of the Master Agreement to be
made between the Borrowers and the Security Trustee, in such form as the
Borrowers and the Agent may agree;
“Mortgage” means, in
relation to a Ship, the first preferred
Panamanian ship mortgage on that Ship to be executed by the relevant Borrower in
favour of the Security Trustee, in such form as the relevant Borrower and the
Agent may agree and fully cross-collateralised with the Mortgages over the other
Ships;
“Multiparty
Deed” means, in relation to a Ship, a deed containing amongst
other things (i) an assignment of the relevant Borrower’s interest in the
Earnings, the Insurances and any Requisition Compensation of that Ship, (ii) an
assignment of the relevant Borrower’s rights under the relevant Bareboat Charter
and the Second Sub-Time Charter (iii) an assignment of the Bareboat Charterer’s
interest in the Insurances of that Ship and the relevant Time Charter, (iv) an
assignment of the Time Charterer’s rights under the First Sub-Time Charter and
(v) an assignment of TBS Worldwide’s rights under the TBS Worldwide Time
Charters to be made by and between the relevant Borrower, the Bareboat Charterer
the, Time Charterer, TBS Worldwide and the Security Trustee, in such form as the
relevant Borrower and the Agent may agree;
|
|
“Negotiation
Period” has the meaning given in Clause 5.10;
|
“New Corporate
Guarantee” means the corporate guarantee executed or to be
executed by the New Corporate Guarantor in favour of the Security Trustee, in
such form as the New Corporate Guarantor and the Agent may agree;
“New Corporate
Guarantor” means TBS International Public Limited Company, a
company incorporated in Ireland having its registered office at Xxxxxx Xxx
Xuilding, Earlsfort Centre, Earlsfort terrace, Dublin 2, Ireland;
“Other Pre-delivery Security
Assignments” means the Pre-delivery Security Assignments as defined in
the Guarantee Facility Agreement;
“Overall
Agreement” means the overall agreement dated 24 February 2007
relating to the Shipbuilding Contracts and made between the Corporate Guarantor
and the Seller;
“Payment
Currency” has the meaning given in Clause 21.4;
“Permitted Security
Interests” means:
|
(a)
|
Security
Interests created by the Finance Documents and the Other Pre-delivery
Security Assignments;
|
|
(b)
|
liens
for unpaid master’s and crew’s wages in accordance with usual maritime
practice;
|
|
(c)
|
liens
for salvage;
|
|
(d)
|
liens
arising by operation of law for not more than 2 months’ prepaid hire under
any charter in relation to a Ship not prohibited by this
Agreement;
|
|
(e)
|
liens
for master’s disbursements incurred in the ordinary course of trading and
any other lien arising by operation of law or otherwise in the ordinary
course of the operation, repair or maintenance of a Ship, provided such
liens do not secure amounts more than 30 days overdue (unless the overdue
amount is being contested by the relevant Borrower in good faith by
appropriate steps) and subject, in the case of liens for repair or
maintenance, to Clause 14.12(g);
|
|
(f)
|
any
Security Interest created in favour of a plaintiff or defendant in any
proceedings or arbitration as security for costs and expenses while the
relevant Borrower is actively prosecuting or defending such proceedings or
arbitration in good faith; and
|
|
(g)
|
Security
Interests arising by operation of law in respect of taxes which are not
overdue for payment or in respect of taxes being contested in good faith
by appropriate steps and in respect of which appropriate reserves have
been made;
|
“Pertinent
Jurisdiction”, in relation to a company, means:
|
(a)
|
England
and Wales;
|
|
(b)
|
the
country under the laws of which the company is incorporated or
formed;
|
|
(c)
|
a
country in which the company’s central management and control is or has
recently been exercised;
|
|
(d)
|
a
country in which the overall net income of the company is subject to
corporation tax, income tax or any similar
tax;
|
|
(e)
|
a
country in which assets of the company (other than securities issued by,
or loans to, related companies) having a substantial value are situated,
in which the company maintains a permanent place of business, or in which
a Security Interest created by the company must or should be registered in
order to ensure its validity or priority;
and
|
|
(f)
|
a
country the courts of which have jurisdiction to make a winding up,
administration or similar order in relation to the company or which would
have such jurisdiction if their assistance were requested by the courts of
a country referred to in paragraphs (b) or
(c);
|
“Potential Event of
Default” means an event or circumstance which, with the giving
of any notice, the lapse of time, a determination (where required) of the
Majority Lenders and/or the satisfaction of any other condition, would
constitute an Event of Default;
“Predelivery Security
Assignment” means, in relation to each Shipbuilding Contract
and corresponding Refund Guarantees, an assignment of the relevant Borrower’s
rights under such Shipbuilding Contract and Refund Guarantees to be executed by
the relevant Borrower in favour of the Security Trustee in such form as the
relevant Borrower and the Agent may agree;
“Quotation
Date” means, in relation to any Interest Period (or any other
period for which an interest rate is to be determined under any provision of a
Finance Document), the day on which quotations would ordinarily be given by
leading banks in the London Interbank Market for deposits in the currency in
relation to which such rate is to be determined for delivery on the first day of
that Interest Period or other period;
“Reference
Banks” means, subject to Clause 26.16, The Royal Bank of Scotland plc, Citibank and
Bank of America;
“Refund
Guarantee” means, in relation to each Ship, each refund
guarantee issued by the Refund Guarantor in favour of the relevant Borrower
pursuant to the Shipbuilding Agreement in respect of such Ship;
“Refund
Guarantor” means Bank of Communications acting through its
branch at 00 Xxx Xxxx Xx Xxx, Xxxxxxx Xxxxxxxx, Xxxxxxx 000000, Xxx People's
Republic of China;
“Related Party Charters” means,
in relation to a Ship, the Bareboat Charter, the Time Charter, the First
Sub-Time Charter, the Second Sub-Time Charter and the TBS Worldwide Time
Charters in relation to such Ship and which are the subject of the assignments
under the relevant Multiparty Deed;
“Relevant
Person” has the meaning given in Clause 19.9;
“Repayment
Date” means a date on which a repayment is required to be made
under Clause 8;
“Requisition
Compensation” includes all compensation or other moneys
payable by reason of any act or event such as is referred to in paragraph (b) of
the definition of “Total Loss”;
“Restricted Equity Deposit
Account” means an account in the name of the Borrowers with
the Agent at Shipping Business Centre, 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
designated with such designation as the Agent may allocate upon its opening or
any other account (with that or another office of the Agent or with a bank or
financial institution other than the Agent) which is designated by the Agent as
the Restricted Equity Deposit Account for the purposes of this
Agreement;
“Restricted Equity Deposit Account
Security Deed” means a deed creating security in respect of
the Restricted Equity Deposit Account made or to be made by and between the
Borrowers and the Security Trustee in such form set as the Borrowers and the
Agent may agree;
“Second Sub-Time Charter” means
in relation to each Ship, the time charter made or to be made between the
relevant Borrower and TBS Worldwide in respect of such Ship;
“Secured
Liabilities” means all liabilities which the Borrowers, the
Security Parties or any of them have, at the date of this Agreement or at any
later time or times, under or in connection with any Finance Document or any
judgment relating to any Finance Document; and for this purpose, there shall be
disregarded any total or partial discharge of these liabilities, or variation of
their terms, which is effected by, or in connection with, any bankruptcy,
liquidation, arrangement or other procedure under the insolvency laws of any
country;
“Security
Interest” means:
|
(a)
|
a
mortgage, charge (whether fixed or floating) or pledge, any maritime or
other lien or assignment by way of security or any other security interest
of any kind;
|
|
(b)
|
the
security rights of a plaintiff under an action in rem;
and
|
|
(c)
|
any
arrangement entered into by a person (A) the effect of which is to place
another person (B) in a position which is similar, in economic terms, to
the position in which B would have been had he held a security interest
over an asset of A; but this paragraph (c) does not apply to a right of
set off or combination of accounts conferred by the standard terms of
business of a bank or financial
institution;
|
“Security
Party” means the Borrowers, the Corporate Guarantor, the New
Corporate Guarantor, the Shareholder and any person who, as a surety or
mortgagor, as a party to any subordination or priorities arrangement, or in any
similar capacity, executes a document falling within the last paragraph of the
definition of “Finance Documents” but for the avoidance of doubt “Security
Party” shall not include any Creditor Party, the Mandated Lead Arranger, the
Bookrunner, the Issuing Bank, the Bareboat Charterer, the Time Charterer, TBS
Pacific Liner, TBS Worldwide and the Approved Managers;
“Security
Period” means the period commencing on the date of this
Agreement and ending on the date on which the Agent notifies the Borrowers, the
Security Parties and the Lenders that:
|
(a)
|
all
amounts which have become due for payment by the Borrowers or any Security
Party under the Finance Documents have been
paid;
|
|
(b)
|
no
amount is owing or has accrued (without yet having become due for payment)
under any Finance Document;
|
|
(c)
|
|
(d)
|
the
Agent, the Security Trustee and the Majority Lenders do not consider that
there is a significant risk that any payment or transaction under a
Finance Document would be set aside, or would have to be reversed or
adjusted, in any present or possible future bankruptcy of a Borrower or a
Security Party or in any present or possible future proceeding relating to
a Finance Document or any asset covered (or previously covered) by a
Security Interest created by a Finance
Document;
|
“Security
Trustee” means The Royal Bank of Scotland plc, acting in such
capacity through its office at Level 0, 000 Xxxxxxxxxxx, Xxxxxx XX0X 0XX, or any
successor of it appointed under clause 5 of the Agency and Trust
Agreement;
“Seller” means
together China Communications and the Builder;
“Servicing
Bank” means the Agent or the Security Trustee;
“Shareholder” means
Xxxxxxxxx Holdings Ltd., a company incorporated under the laws of the Xxxxxxxx
Islands having its registered office at Trust Company Complex, Ajeltake Road,
Ajeltake Island, Majuro, Xxxxxxxx Islands, MH96960;
“Shares Security
Deed” means, in relation to each Borrower, a deed creating
security over the share capital of that Xxxxxxxx and including an assignment of
any shareholder loans made to the Borrowers to be executed by the Shareholder in
favour of the Security Trustee in such form as the Shareholder and the Agent may
agree;
“Ships” means
together Ship A, Ship B, Ship C, Ship D, Ship E and Ship F and, in the singular,
means any of them;
“Ship A” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200720 to be constructed and sold by the Seller and to be purchased by
Borrower A pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower A with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Ship B” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200721 to be constructed and sold by the Seller and to be purchased by
Borrower B pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower B with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Ship C” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200722 to be constructed and sold by the Seller and to be purchased by
Borrower C pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower C with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Ship D” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200723 to be constructed and sold by the Seller and to be purchased by
Borrower D pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower D with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Ship E” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200724 to be constructed and sold by the Seller and to be purchased by
Borrower E pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower E with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Ship F” means the
multipurpose bulk carrier of about 35,000 dwt having Builder’s Hull No.
NYHS200725 to be constructed and sold by the Seller and to be purchased by
Borrower F pursuant to the relevant Shipbuilding Contract and upon delivery to
be registered in the name of Borrower F with the Panamanian registry and
bareboat registered in the name of the Bareboat Charterer under the Philippines
flag;
“Shipbuilding
Contract” means, in relation to Ship A, the shipbuilding
contract dated 24 February 2007 made between the Seller and Borrower A in
respect of such Ship, in relation to Ship B, the shipbuilding contract dated 24
February 2007 made between the Seller and Borrower B in respect of such Ship, in
relation to Ship C, the shipbuilding contract dated 24 February 2007 made
between the Seller and Borrower C in respect of such Ship, in relation to Ship
D, the shipbuilding contract dated 24 February 2007 made between the Seller and
Borrower D in respect of such Ship, in relation to Ship E, the shipbuilding
contract dated 24 February 2007 made between the Seller and Borrower E in
respect of such Ship, in relation to Ship F, the shipbuilding contract dated 24
February 2007 made between the Seller and Borrower F in respect of such Ship
and, in each case, as supplemented by the Overall Agreement;
“Standby Earnings
Account” means an account in the name of TBS Pacific Liner
with the Agent at Shipping Business Centre, 0-00 Xxxxx Xxxxx Xxxxxx, Xxxxxx XX0X
0XX designated with such designation as the Agent may allocate upon its opening
or any other account (with that or another office of the Agent or with a bank or
financial institution other than the Agent) which is designated by the Agent as
the Standby Earnings Account for the purposes of this Agreement;
“Swap Bank” means
The Royal Bank of Scotland plc acting in such capacity through its office at 000
Xxxxxxxxxxx, Xxxxxx XX0X 0XX and its successors in title and assigns under the
Master Agreement;
“Swap Facility” means the interest rate
swap facility made or to be made available by the Swap Bank to the Borrowers
under the Master Agreement;
“TBS Pacific
Liner” means TBS Pacific Liner, Ltd. being a corporation
organised and existing under the laws of the Xxxxxxxx Islands and having its
registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro, Xxxxxxxx Islands, MH 96960;
“TBS Worldwide” means TBS
Worldwide Services Inc being a corporation organised and existing under the laws
of the Xxxxxxxx Islands having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro, Xxxxxxxx Islands, MH 96960;
“TBS Worldwide Time Charters”
means, in relation to each Ship, the time charters entered or to be entered into
between TBS Worldwide and other subsidiaries of the New Corporate Guarantor
pursuant to which TBS Worldwide has agreed or shall agree to let, and such
charterers have agreed or shall agree to hire, such Ship on time
charter;
“Time Charter” means, in relation to
each Ship, the time charter made or to be made between the Bareboat Charterer
and the Time Charterer in respect of such Ship;
“Time Charterer” means Pacific
Rim Shipping Corp., a company incorporated in the Xxxxxxxx Islands whose
principal office is at Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro, Xxxxxxxx Islands, MH 96960;
“Total Loss” means,
in relation to a Ship:
|
(a)
|
actual,
constructive, compromised, agreed or arranged total loss of the
Ship;
|
|
(b)
|
any
expropriation, confiscation, requisition or acquisition of the Ship,
whether for full consideration, a consideration less than its proper
value, a nominal consideration or without any consideration, which is
effected by any government or official authority or by any person or
persons claiming to be or to represent a government or official authority
(excluding a requisition for hire for a fixed period not exceeding 1 year
without any right to an extension) unless it is within 1 month redelivered
to the full control of the Borrower owning the Ship;
and
|
|
(c)
|
any
condemnation of the Ship by any tribunal or by any person or person
claiming to be a tribunal; and
|
|
(d)
|
any
arrest, capture, seizure or detention of the Ship (including any hijacking
or theft) unless it is within 1 month redelivered to the full control of
the Borrower owning the Ship;
|
“Total Loss
Date” means, in relation to a Ship:
|
(a)
|
in
the case of an actual loss of the Ship, the date on which it occurred or,
if that is unknown, the date when the Ship was last heard
of;
|
|
(b)
|
in
the case of a constructive, compromised, agreed or arranged total loss of
the Ship, the earliest of:
|
|
(i)
|
the
date on which a notice of abandonment is given to the insurers;
and
|
|
(ii)
|
the
date of any compromise, arrangement or agreement made by or on behalf of
the Borrower owning the Ship with the Ship’s insurers in which the
insurers agree to treat the Ship as a total loss;
and
|
|
|
(c)
|
in
the case of any other type of total loss, on the date (or the most likely
date) on which it appears to the Agent that the event constituting the
total loss occurred;
|
“Transaction” means
a Transaction as defined in the introductory paragraph of the Master
Agreement;
“Transfer
Certificate” has the meaning given in Clause 26.2; and
“Transfer Date” means, in
relation to a transfer, the later of:
|
(a)
|
the
proposed transfer date specified in the Transfer Certificate;
and
|
|
(b)
|
the
date on which the Agent executes the Transfer Certificate under Clause 26.3.
|
|
1.2
|
Construction of certain
terms. In this
Agreement:
|
“administration
notice” means a notice appointing an administrator, a notice
of intended appointment and any other notice which is required by law (generally
or in the case concerned) to be filed with the court or given to a person prior
to, or in connection with, the appointment of an administrator;
“approved” means,
for the purposes of Clause 13, approved in writing
by the Agent;
“asset” includes
every kind of property, asset, interest or right, including any present, future
or contingent right to any revenues or other payment;
“company” includes
any partnership, joint venture and unincorporated association;
“consent” includes
an authorisation, consent, approval, resolution, licence, exemption, filing,
registration, notarisation and legalisation;
“contingent
liability” means a liability which is not certain to arise
and/or the amount of which remains unascertained;
“document” includes
a deed; also a letter or fax;
“excess
risks” means, in relation to a Ship, the proportion of claims
for general average, salvage and salvage charges not recoverable under the hull
and machinery policies in respect of the Ship in consequence of its insured
value being less than the value at which the Ship is assessed for the purpose of
such claims;
“expense” means any
kind of cost, charge or expense (including all legal costs, charges and
expenses) and any applicable value added or other tax;
“law” includes any
order or decree, any form of delegated legislation, any treaty or international
convention and any regulation, directive, decision or resolution of the Council
of the European Union, the European Commission, the United Nations or its
Security Council;
“legal or administrative
action” means any legal proceeding or arbitration and any
administrative or regulatory action or investigation;
“liability” includes
every kind of debt or liability (present or future, certain or contingent),
whether incurred as principal or surety or otherwise;
“months” shall be
construed in accordance with Clause 1.3;
“obligatory
insurances” means, in relation to a Ship, all insurances
effected, or which the Borrower owning the Ship is obliged to effect, under
Clause 13 or any other provision of this Agreement
or another Finance Document;
“parent company” has
the meaning given in Clause 1.4;
“person” includes
any company; any state, political sub-division of a state and local or municipal
authority; and any international organisation;
“policy”, in relation to any
insurance, includes a slip, cover note, certificate of entry or other document
evidencing the contract of insurance or its terms;
“protection and indemnity
risks” means the usual risks covered by a protection and indemnity
association managed in London, including pollution risks and the proportion (if
any) of any sums payable to any other person or persons in case of collision
which are not recoverable under the hull and machinery policies by reason of the
incorporation in them of clause 1 of the Institute Time Clauses (Hulls)(1/10/83)
or clause 8 of the Institute Time Clauses (Hulls)(1/11/1995) or the Institute
Amended Running Down Clause (1/10/71) or any equivalent provision;
“regulation” includes
any regulation, rule, official directive, request or guideline whether or not
having the force of law of any governmental, intergovernmental or supranational
body, agency, department or regulatory, self-regulatory or other authority or
organisation;
“subsidiary” has the
meaning given in Clause 1.4;
“tax” includes any
present or future tax, duty, impost, levy or charge of any kind which is imposed
by any state, any political sub-division of a state or any local or municipal
authority (including any such imposed in connection with exchange controls), and
any connected penalty, interest or fine; and
“war risks” includes
the risk of mines and all risks excluded by clause 23 of the Institute Time
Clauses (Hulls)(1/10/83) or clause 24 of the Institute Time Clauses (Hulls)
(1/11/1995).
|
1.3
|
Meaning of
“month”. A period of one or more “months” ends on the day
in the relevant calendar month numerically corresponding to the day of the
calendar month on which the period started (“the numerically corresponding
day”), but:
|
|
(a)
|
on
the Business Day following the numerically corresponding day if the
numerically corresponding day is not a Business Day or, if there is no
later Business Day in the same calendar month, on the Business Day
preceding the numerically corresponding day;
or
|
|
(b)
|
on
the last Business Day in the relevant calendar month, if the period
started on the last Business Day in a calendar month or if the last
calendar month of the period has no numerically corresponding
day;
|
and
“month” and “monthly” shall be construed
accordingly.
|
1.4
|
Meaning of
“subsidiary”. A company (S) is a subsidiary of another
company (P) if:
|
|
(a)
|
a
majority of the issued shares in S (or a majority of the issued shares in
S which carry unlimited rights to capital and income distributions) are
directly owned by P or are indirectly attributable to P;
or
|
|
(b)
|
P
has direct or indirect control over a majority of the voting rights
attaching to the issued shares of S;
or
|
|
(c)
|
P
has the direct or indirect power to appoint or remove a majority of the
directors of S; or
|
|
(d)
|
P
otherwise has the direct or indirect power to ensure that the affairs of S
are conducted in accordance with the wishes of
P;
|
and any
company of which S is a subsidiary is a parent company of S.
|
1.5
|
General
Interpretation. In this
Agreement:
|
|
(a)
|
references
in Clause 1.1 to a Finance Document or any
other document being in the form of a particular appendix include
references to that form with any modifications to that form which the
Agent (with the authorisation of the Majority Lenders in the case of
substantial modifications) approves or reasonably
requires;
|
|
(b)
|
references
to, or to a provision of, a Finance Document or any other document are
references to it as amended or supplemented, whether before the date of
this Agreement or otherwise;
|
|
(c)
|
references
to, or to a provision of, any law include any amendment, extension,
re-enactment or replacement, whether made before the date of this
Agreement or otherwise;
|
|
(d)
|
words
denoting the singular number shall include the plural and vice versa;
and
|
|
1.6
|
Headings. In
interpreting a Finance Document or any provision of a Finance Document,
all clause, sub-clause and other headings in that and any other Finance
Document shall be entirely
disregarded.
|
|
2
|
LOAN
FACILITY
|
|
2.1
|
Amount of
facilities. Subject to the other provisions of this
Agreement, the Lenders shall make available to the Borrowers the Loan
Facility in an amount of up to $150,000,000 which shall be made available
in the following Advances:
|
|
(i)
|
five
Advances in an aggregate amount of up to $25,000,000 to enable Borrower A
to finance its acquisition of Ship A as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower A to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship A;
|
|
(B)
|
$5,000,000
to enable Borrower A to meet the second stage payment (steel cutting) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship A;
|
|
(C)
|
$5,000,000
to enable Borrower A to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
A;
|
|
(D)
|
$5,000,000
to enable Borrower A to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
A;
|
|
(E)
|
$5,000,000
to enable Borrower A to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship A (the
“Loan A Delivery
Advance”);
|
|
(ii)
|
five
Advances in an aggregate amount of $25,000,000 to enable Borrower B to
finance its acquisition of Ship B as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower B to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship B;
|
|
(B)
|
$5,000,000
to enable Borrower B to meet the second stage payment (steel cutting) of
the Contract Price payable under the Shipbuilding Agreement in respect of
Ship B;
|
|
(C)
|
$5,000,000
to enable Borrower B to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
B;
|
|
(D)
|
$5,000,000
to enable Borrower B to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
B;
|
|
(E)
|
$5,000,000
to enable Borrower B to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship B (the
“Loan B Delivery
Advance”);
|
|
(iii)
|
five
Advances in an aggregate amount of up to $25,000,000 to enable Borrower C
to finance its acquisition of Ship C as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower C to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship C;
|
|
(B)
|
$5,000,000
to enable Borrower C to meet the second stage payment (steel cutting) of
the Contract Price payable under the Shipbuilding Agreement in respect of
Ship C;
|
|
(C)
|
$5,000,000
to enable Borrower C to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
C;
|
|
(D)
|
$5,000,000
to enable Borrower C to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
C;
|
|
(E)
|
$5,000,000
to enable Borrower C to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship C (the
“Loan C Delivery
Advance”);
|
|
(iv)
|
five
Advances in an aggregate amount of up to $25,000,000 to enable Borrower D
to finance its acquisition of Ship D as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower D to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship D;
|
|
(B)
|
$5,000,000
to reimburse Borrower D the second stage payment (steel cutting) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
D;
|
|
(C)
|
$5,000,000
to enable Borrower D to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
D;
|
|
(D)
|
$5,000,000
to enable Borrower D to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
D;
|
|
(E)
|
$5,000,000
to enable Borrower D to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship D; (the
“Loan D Delivery
Advance”);
|
|
(v)
|
five
Advances in an aggregate amount of up to $25,000,000 to enable Borrower E
to finance its acquisition of Ship E as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower E to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship E;
|
|
(B)
|
$5,000,000
to reimburse Borrower E the second stage payment (steel cutting) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
E;
|
|
(C)
|
$5,000,000
to enable Borrower E to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
E;
|
|
(D)
|
$5,000,000
to enable Borrower E to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
E;
|
|
(E)
|
$5,000,000
to enable Borrower E to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship E; (the
“Loan E Delivery
Advance”);
|
|
(vi)
|
five
Advances in an aggregate amount of up to $25,000,000 to enable Borrower F
to finance its acquisition of Ship F as
follows:
|
|
(A)
|
$5,000,000
to enable Borrower F to meet the first stage payment (contract signing) of
the Contract Price payable under the Shipbuilding Contract in respect of
Ship F;
|
|
(B)
|
$5,000,000
to reimburse Borrower F the second stage payment (steel cutting) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
F;
|
|
(C)
|
$5,000,000
to enable Borrower F to meet the third stage payment (keel laying) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
F;
|
|
(D)
|
$5,000,000
to enable Borrower F to meet the fourth stage payment (launching) of the
Contract Price payable under the Shipbuilding Contract in respect of Ship
F;
|
|
(E)
|
$5,000,000
to enable Borrower F to meet the final delivery payment of the Contract
Price payable under the Shipbuilding Contract in respect of Ship F; (the
“Loan F Delivery
Advance”);
|
|
2.2
|
Lenders’
participations. Subject to the other provisions of this
Agreement, each Lender shall participate in each Advance in the proportion
which, as at the relevant Drawdown Date, its Commitment bears to the Total
Commitments;
|
|
2.3
|
Purpose of
Advances. The Borrowers undertake with each Creditor
Party to use each Advance only for the respective purposes stated in the
preamble of this Agreement.
|
|
3
|
POSITION
OF THE LENDERS AND THE SWAP BANK
|
|
3.1
|
Interests of Creditor Parties
several. The rights of the Creditor Parties under this
Agreement are several.
|
|
3.2
|
Individual Creditor Parties’
right of action. Each Lender and the Swap Bank shall be
entitled to sue for any amount which has become due and payable by the
Borrowers to it under this Agreement without joining the Agent, the
Security Trustee or any other Creditor Party as additional parties in the
proceedings.
|
|
3.3
|
Proceedings by individual
Creditor Party requiring Majority Lenders’
consent. Except as provided in Clause 3.2, neither the Swap Bank nor any Lender may
commence proceedings against the Borrowers or any Security Party in
connection with a Finance Document without the prior consent of the
Majority Lenders.
|
|
3.4
|
Obligations of Creditor Parties
several. The obligations of the Lenders and the Swap
Bank under this Agreement are several; and a failure of a Lender or the
Swap Bank to perform its obligations under this Agreement shall not result
in:
|
|
(a)
|
the
obligations of the other Lenders or the Swap Bank being increased;
nor
|
|
(b)
|
any
Borrower, any Security Party, any other Lender or the Swap Bank being
discharged (in whole or in part) from its obligations under any Finance
Document;
|
and in no
circumstances shall a Lender or the Swap Bank have any responsibility for a
failure of another Lender or the Swap Bank (as the case may be) to perform its
obligations under this Agreement.
|
3.5
|
Ranking of Swap
Facility. It is agreed by the Borrowers and the Creditor
Parties that the Swap Facility and all amounts payable thereunder shall
rank in priority after the Loan
Facility.
|
|
4
|
DRAWDOWN
|
|
4.1
|
Request for an
Advance. Subject to the following conditions, a Borrower
may request that an Advance be made by ensuring that the Agent receives a
completed Drawdown Notice not later than 11.00 a.m. (London time) 3
Business Days prior to the intended Drawdown
Date.
|
|
4.2
|
Availability. The
conditions referred to in Clause 4.1 are
that:
|
|
(a)
|
|
|
(i)
|
the
Drawdown Date for such Advance has to be a Business Day during the
Availability Period for the relevant
Loan;
|
|
(ii)
|
the
aggregate amount of the Advances shall not exceed the Total
Commitments;
|
|
(iii)
|
in
the case of a Delivery Advance of a Loan, the amount of such Delivery
Advance when aggregated with each of the other Advances made in relation
to that Loan shall not exceed 75% of the valuation of the relevant Ship to
be obtained pursuant to Schedule 3, Part C, Item 4 and if such test is not
met the amount of such Delivery Advance shall be correspondingly
reduced.
|
|
(b)
|
|
(i)
|
no
Event of Default or Potential Event of Default has occurred and is
continuing or might result from the making of the relevant
Advance;
|
|
(ii)
|
the
representations and warranties of the Borrowers in Clause 10 and those of the Borrowers or any Security
Party which are set out in the other Finance Documents would be true and
not misleading if repeated on the date of the relevant Drawdown Notice or
the relevant Drawdown Date with reference to the circumstances then
existing;
|
|
(iii)
|
that
if the ratio set out in Clause 15.1 were
applied immediately following the making of the Advance the Borrowers
would not be obliged to provide additional security or prepay part of the
Loans under that Clause and if the Borrowers would be so obliged the
amount of the Advance to be made shall be correspondingly
reduced.
|
|
4.3
|
Notification to Lenders of
receipt of a Drawdown Notice. The Agent shall promptly
notify the Lenders that it has received a Drawdown Notice and shall inform
each Lender of:
|
|
(a)
|
the
amount of the Advance and the Drawdown
Date;
|
|
(b)
|
the
amount of that Xxxxxx’s participation in the relevant Advance;
and
|
|
(c)
|
the
duration of the first Interest Period for the relevant
Advance.
|
|
4.4
|
Drawdown Notice
irrevocable. A Drawdown Notice must be signed by a
director, officer or, if agreed by the Agent, a duly authorised
attorney-in-fact of the Borrowers; and once served, a Drawdown Notice
cannot be revoked without the prior consent of the Agent, acting on the
authority of the Majority Lenders.
|
|
4.5
|
Lenders to make available
Contributions. Subject to the provisions of this
Agreement, each Lender shall, on and with value on each Drawdown Date,
make available to the Agent for the account of the Borrowers the amount
due from that Lender on that Drawdown Date under Clause 2.2.
|
|
4.6
|
Disbursement of
Advance. Subject to the provisions of this Agreement,
the Agent shall on each Drawdown Date pay to the Borrowers the amounts
which the Agent receives from the Lenders under Clause 4.5; and that payment to the Borrowers shall be
made:
|
|
(a)
|
to
the account which the Borrowers specifies in the Drawdown Notice;
and
|
|
(b)
|
in
the like funds as the Agent received the payments from the
Lenders.
|
|
4.7
|
Disbursement of an Advance to
third party. The payment by the Agent under Clause 4.6 shall constitute the making of the Advance
and each Borrower shall at that time become indebted, as a principal and
direct obligor, to each Lender in an amount equal to that Lender’s
Contribution.
|
|
5
|
INTEREST
|
|
5.1
|
Payment of normal
interest. Subject to the provisions of this Agreement,
interest on an Advance in respect of each Interest Period applicable to it
shall be paid by the Borrowers on the last day of that Interest
Period.
|
|
5.2
|
Normal rate of
interest. Subject to the provisions of this Agreement,
the rate of interest on each Advance in respect of an Interest Period
shall be the aggregate of the Margin, the Mandatory Cost (if any) and
LIBOR for that Interest Period.
|
|
5.3
|
Payment of accrued
interest. In the case of an Interest Period longer than
3 months, accrued interest shall be paid every 3 months during that
Interest Period and on the last day of that Interest
Period.
|
|
5.4
|
Notification of Interest
Periods and rates of normal interest. The Agent shall
(subject to Clause 6.2(a) notify the
Borrowers and each Lender of:
|
|
(a)
|
each
rate of interest; and
|
|
(b)
|
the
duration of each Interest Period;
|
as soon
as reasonably practicable after each is determined.
|
5.5
|
Obligation of Reference Xxxxx
to quote. A Reference Bank which is a Lender shall use
all reasonable efforts to supply the quotation required of it for the
purposes of fixing a rate of interest under this
Agreement.
|
|
5.6
|
Absence of quotations by
Reference Xxxxx. If any Reference Bank fails to supply a
quotation, the Agent shall determine the relevant LIBOR on the basis of
the quotations supplied by the other Reference Bank or Banks; but if 2 or
more of the Reference Banks fail to provide a quotation, the relevant rate
of interest shall be set in accordance with the following provisions of
this Clause 5.
|
|
5.7
|
Market
disruption. The following provisions of this Clause 5 apply
if:
|
|
(a)
|
no
rate is quoted on REUTERS BBA Page LIBOR 01 and the Reference Banks do
not, before 1.00 p.m. (London time) on the Quotation Date for an Interest
Period, provide quotations to the Agent in order to fix LIBOR;
or
|
|
(b)
|
at
least 1 Business Day before the start of an Interest Period, Lenders
having Contributions together amounting to more than 66.66 per cent. of
the Loans (or, if an Advance has not been made, Commitments amounting to
more than 66.66 per cent. of the Total Commitments) notify the Agent that
LIBOR fixed by the Agent would not accurately reflect the cost to those
Lenders of funding their respective Contributions (or any part of them)
during the Interest Period in the London Interbank Market at or about
11.00 a.m. (London time) on the Quotation Date for the Interest Period;
or
|
|
(c)
|
at
least 1 Business Day before the start of an Interest Period, the Agent is
notified by a Lender (the “Affected Lender”) that
for any reason it is unable to obtain Dollars in the London Interbank
Market in order to fund its Contribution (or any part of it) during the
Interest Period.
|
|
5.8
|
Notification of market
disruption. The Agent shall promptly notify the
Borrowers and each of the Lenders stating the circumstances falling within
Clause 5.7 which have caused its notice to be
given.
|
|
5.9
|
Suspension of
drawdown. If the Agent’s notice under Clause 5.8 is served before an Advance is
made:
|
|
(a)
|
|
(b)
|
in
a case falling within Clause 5.7(c), the
Affected Xxxxxx’s obligation to participate in the
Advance;
|
shall be
suspended while the circumstances referred to in the Agent’s notice
continue.
|
5.10
|
Negotiation of alternative rate
of interest. If the Agent’s notice under Clause 5.8 is served after an Advance is made, the
Borrowers, the Agent and the Lenders or (as the case may be) the Affected
Lender shall use reasonable endeavours to agree, within the 30 days after
the date on which the Agent serves its notice under Clause 5.8 (the “Negotiation Period”), an
alternative interest rate or (as the case may be) an alternative basis for
the Lenders or (as the case may be) the Affected Lender to fund or
continue to fund their or its Contribution during the Interest Period
concerned.
|
|
5.11
|
Application of agreed
alternative rate of interest. Any alternative interest
rate or an alternative basis which is agreed during the Negotiation Period
shall take effect in accordance with the terms
agreed.
|
|
5.12
|
Alternative rate of interest in
absence of agreement. If an alternative interest rate or
alternative basis is not agreed within the Negotiation Period, and the
relevant circumstances are continuing at the end of the
Negotiation Period, then the Agent shall, with the agreement of each
Lender or (as the case may be) the Affected Lender, set an interest period
and interest rate representing the cost of funding of the Lenders or (as
the case may be) the Affected Lender in Dollars or in any available
currency of their or its Contribution plus the Margin; and the procedure
provided for by this Clause 5.12 shall be
repeated if the relevant circumstances are continuing at the end of the
interest period so set by the Agent. Once the circumstances
giving rise to the invoking of Clauses 5.7
through 5.12 have ceased the Agent and the
Lenders shall return to the normal method of calculating the interest rate
hereunder.
|
|
5.13
|
Notice of
prepayment. If the Borrowers do not agree with an
interest rate set by the Agent under Clause 5.12, the Borrowers may give the Agent not less
than 14 Business Days’ notice of their intention to prepay the Loans or
the Affected Lender’s Contribution (as the case may require) at the end of
the interest period set by the
Agent.
|
|
5.14
|
Prepayment; termination of
Commitments. A notice under Clause 5.13 shall be irrevocable; the Agent shall
promptly notify the Lenders or (as the case may require) the Affected
Lender of the Borrowers’ notice of intended prepayment;
and:
|
|
(a)
|
on
the date on which the Agent serves that notice, the Total Commitments or
(as the case may require) the Commitment of the Affected Lender shall be
cancelled; and
|
|
(b)
|
on
the last Business Day of the interest period set by the Agent, the
Borrowers shall prepay (without premium or penalty) the Loans or, as the
case may be, the Affected Lender’s Contribution, together with accrued
interest thereon at the applicable rate plus the
Margin.
|
|
5.15
|
|
5.16
|
Designated Transactions under
the Master Agreement.
|
|
(a)
|
The
Borrowers have entered into the Master Agreement with the Swap Bank and,
pursuant thereto, may at any time conclude Designated Transactions, for
the purpose of swapping their interest payment obligations under this
Agreement in relation to the Loan
Facility.
|
|
(b)
|
In
relation to the Master Agreement, the Borrowers hereby agree and undertake
throughout the Security Period:
|
|
(i)
|
only
to use Designated Transactions concluded under the Master Agreement for
the purpose of swapping their interest payment obligations under this
Clause 5 in relation to the Loan Facility from LIBOR-based funding to
longer-term fixed rate funding; and
|
|
(ii)
|
not
to conclude Designated Transactions which would result, at any time during
the Security Period, in the notional principal amount of all Designated
Transactions then remaining exceeding the aggregate amount of the Loans,
as reduced from time to time pursuant to Clause
8.
|
|
(c)
|
The
Lenders agree that, to enable the Borrowers to secure their obligations to
the Swap Bank under the Master Agreement, the security of the New
Corporate Guarantee, the Corporate Guarantee, the Mortgages, the
Multiparty Deeds, the Predelivery Security Assignments, the Shares
Security Deeds, the Restricted Equity Deposit Account Security Deed and
the Account Security Deed in respect of each of the Ships shall be held by
the Security Trustee not only to secure the Borrowers’ obligations under
this Agreement but also the Borrower’s obligations under the Master
Agreement on the terms set out in Clause 18.
|
|
6
|
INTEREST
PERIODS
|
|
6.1
|
Commencement of Interest
Periods. The first Interest Period applicable to an
Advance shall commence on the Drawdown Date for that Advance and each
subsequent Interest Period shall commence on the expiry of the preceding
Interest Period.
|
|
6.2
|
|
(a)
|
1,
3 or 6 months as notified by the Borrowers to the Agent not later than
11.00 a.m. (London time) 3 Business Days before the commencement of the
Interest Period; or
|
|
(b)
|
in
the case of the first Interest Period applicable to any Advance of a Loan
other than the first such Advance of such Loan, a period ending on the
last day of the Interest Period applicable to the first Advance of that
Loan then current, whereupon all such Advances of that Loan shall be
consolidated and treated as a single
Advance;
|
|
(c)
|
3
months, if the Borrowers fail to notify the Agent by the time specified in
paragraph (a); or
|
|
(d)
|
such
other period as the Agent may, with the authorisation of the Majority
Xxxxxxx, agree with the Borrowers.
|
|
6.3
|
Duration of Interest Periods
for repayment instalments. In respect of an amount due
to be repaid under Clause 8 on a particular
Repayment Date, an Interest Period shall end on that Repayment
Date.
|
|
6.4
|
Non-availability of matching
deposits for Interest Period selected. If, after the
Borrowers have selected and the Lenders have agreed an Interest Period
longer than 6 months, any Lender notifies the Agent by 11.00 a.m. (London
time) on the third Business Day before the commencement of the Interest
Period that it is not satisfied that deposits in Dollars for a period
equal to the Interest Period will be available to it in the London
Interbank Market when the Interest Period commences, the Interest Period
shall be of 6 months.
|
|
7
|
DEFAULT
INTEREST
|
|
7.1
|
Payment of default interest on
overdue amounts. The Borrowers shall pay interest in
accordance with the following provisions of this Clause 7 on any amount
payable by the Borrowers under any Finance Document which the relevant
Creditor Party does not receive on or before the relevant date, that
is:
|
|
(a)
|
the
date on which the Finance Documents provide that such amount is due for
payment; or
|
|
(b)
|
if
a Finance Document provides that such amount is payable on demand, the
date on which the demand is served on the Borrowers;
or
|
|
(c)
|
if
such amount has become immediately due and payable under Clause 19.4, the date on which it became immediately
due and payable.
|
|
7.2
|
Default rate of
interest. Interest shall accrue on an overdue amount
from (and including) the relevant date until the date of actual payment
(as well after as before judgment) at the rate per annum determined by the
Agent to be 1.5 per cent. above:
|
|
(a)
|
in
the case of an overdue amount of principal, the higher of the rates set
out at Clauses 7.3(a) and (b); or
|
|
(b)
|
in
the case of any other overdue amount, the rate set out at Clause 7.3(b).
|
|
7.3
|
Calculation of default rate of
interest. The rates referred to in Clause 7.2 are:
|
|
(a)
|
the
rate applicable to the overdue principal amount immediately prior to the
relevant date (but only for any unexpired part of any then current
Interest Period applicable to it);
|
|
(b)
|
the
aggregate of the Margin and the Mandatory Cost (if any) plus, in respect
of successive periods of any duration (including at call) up to 3 months
which the Agent may select from time to
time:
|
|
(i)
|
LIBOR;
or
|
|
(ii)
|
if
the Agent (after consultation with the Reference Banks) determines that
Dollar deposits for any such period are not being made available to any
Reference Bank by leading banks in the London Interbank Market in the
ordinary course of business, a rate from time to time determined by the
Agent by reference to the cost of funds to the Reference Banks from such
other sources as the Agent (after consultation with the Reference Banks)
may from time to time determine.
|
|
7.4
|
Notification of interest
periods and default rates. The Agent shall promptly
notify the Lenders and the Borrowers of each interest rate determined by
the Agent under Clause 7.3 and of each period
selected by the Agent for the purposes of paragraph (b) of that Clause;
but this shall not be taken to imply that the Borrowers are liable to pay
such interest only with effect from the date of the Agent’s
notification.
|
|
7.5
|
Payment of accrued default
interest. Subject to the other provisions of this
Agreement, any interest due under this Clause shall be paid on the last
day of the period by reference to which it was determined; and the payment
shall be made to the Agent for the account of the Creditor Party to which
the overdue amount is due.
|
|
7.6
|
Compounding of default
interest. Any such interest which is not paid at the end
of the period by reference to which it was determined shall thereupon be
compounded.
|
|
7.7
|
Application to Master
Agreement. For the avoidance of doubt, this Clause 7 does not apply to any amount payable under the
Master Agreement in respect of any continuing Designated Transaction as to
which section 2(e) (Default Interest; Other Amounts) of the
Master Agreement shall apply.
|
|
8
|
REPAYMENT
AND PREPAYMENT
|
|
8.1
|
Repayment of
Loans. The Borrowers shall repay the Loans in the
instalments and on the repayment dates set out in Schedule
5.
|
|
8.2
|
Final Repayment
Date. On the Final Repayment Date, the Borrowers shall
additionally pay to the Agent for the account of the Creditor Parties all
other sums then accrued or owing under any Finance
Document.
|
|
8.3
|
Voluntary
prepayment. Subject to the following conditions, the
Borrowers may prepay the whole or any part of a
Loan.
|
|
8.4
|
Conditions for voluntary
prepayment. The conditions referred to in Clause 8.3 are
that:
|
|
(a)
|
a
partial prepayment shall be in a minimum amount of $2,500,000 (and in
integral multiples of $500,000);
|
|
(b)
|
the
Agent has received from the Borrowers at least 7 Business Days’ prior
written notice specifying the amount to be prepaid and the date on which
the prepayment is to be made; and
|
|
(c)
|
the
Borrowers have provided evidence satisfactory to the Agent that any
consent required by the Borrowers in connection with the prepayment has
been obtained and remains in force, and that any
official regulation relevant to this Agreement which affects
the Borrowers has been complied
with.
|
|
8.5
|
Effect of notice of
prepayment. A prepayment notice may not be withdrawn or
amended without the consent of the Agent, given with the authorisation of
the Majority Lenders, and the amount specified in the prepayment notice
shall become due and payable by the Borrowers on the date for prepayment
specified in the prepayment notice.
|
|
8.6
|
Notification of notice of
prepayment. The Agent shall notify the Lenders promptly
upon receiving a prepayment notice, and shall provide any Lender which so
requests with a copy of any document delivered by the Borrowers under
Clause 8.4(c).
|
|
8.7
|
Mandatory prepayment upon a
Sale or Total Loss of a Ship. Without prejudice to the
provisions of Clause 15, the Borrowers shall
be obliged to make a prepayment in respect of the Loans if a Ship is sold
or becomes a Total Loss or on the occurrence of one of the events set out
in Clause 8.13 in relation to a Shipbuilding
Contract:
|
|
(a)
|
in
the case of a sale, on or before the date on which the sale is completed
by delivery of the Ship to the buyer;
or
|
|
(b)
|
in
the case of a Total Loss, on the earlier of the date falling 120 days
after the Total Loss Date and the date of receipt by the Security Trustee
of the proceeds of insurance relating to such Total Loss;
or
|
|
(c)
|
in
the case of the occurrence of one of the events set out in Clause 8.13 in relation to a Shipbuilding Contract, on
demand by the Agent,
|
and in
any such case the amount to be prepaid in respect of the Loans shall be the
greater of:
|
(i)
|
the
Loan relative to that Ship or that Shipbuilding Contract;
and
|
|
(ii)
|
such
sum as is necessary to ensure that, in relation to the remaining amount of
the Loans and the remaining Ship or Ships immediately after such
prepayment, the same asset cover ratio (calculated as per Clause 15.3) applies as applied immediately prior to
such prepayment or, if higher, such sum as shall ensure that the
requirements of Clause 15.1 are then complied
with.
|
|
8.8
|
Mandatory prepayment upon a
change of control. If there is a change of ownership of
the shares in the New Corporate Guarantor or any Borrower such that an
individual or company (or group of individuals and/or companies acting in
concert) which does not at the date of this Agreement control the New
Corporate Guarantor or that Borrower acquires control of the New Corporate
Guarantor or that Borrower:
|
|
(i)
|
the
Borrowers shall promptly notify the Agent upon becoming aware of that
event; and
|
|
(ii)
|
a
Lender shall not be obliged to fund an Advance requested in a Drawdown
Notice and (unless the Agent has previously given its written consent to
such change of control acting on the instruction of all the Lenders) a
Lender, by not less than 10 days’ notice to the Borrowers and the other
Lenders, may cancel its Available Commitment and require repayment of all
of its Contribution immediately.
|
For the
purpose of this Clause 8.8 “acting in concert” means actively co-operating
pursuant to an agreement or understanding (whether formal or
informal).
|
8.9
|
Amounts payable on
prepayment. A prepayment shall be made together with
accrued interest (and any other amount payable under Clauses
8.14, 21 or otherwise) in respect
of the amount prepaid and, if the prepayment is not made on the last day
of an Interest Period together with any sums payable under Clause 21.1(b) but without premium or
penalty.
|
|
8.10
|
Application of partial
prepayment. Each partial prepayment of a Loan shall be
applied against the repayment instalments of such Loan in inverse order of
maturity.
|
|
8.11
|
No
Reborrowing. No amount of the Loans prepaid may be
reborrowed.
|
|
8.12
|
Unwinding of Designated
Transactions. On or prior to any repayment or prepayment
of the Loans under this Clause 8 or any other
provision of this Agreement, the Borrowers shall wholly or partially
reverse, offset, unwind or otherwise terminate one or more of the
continuing Designated Transactions so that the notional principal amount
of the continuing Designated Transactions thereafter remaining does not
and will not in the future (taking into account the scheduled
amortisation) exceed the amount of the Loans as reducing from time to time
thereafter pursuant to Clause 8.1.
|
|
8.13
|
Prepayment pursuant to events
arising in respect of the Shipbuilding Contracts. The
events referred to in Clause 8.7(c)
are:
|
|
(a)
|
the
occurrence of any of the events referred to in Article(s) X or XI of any
of the Shipbuilding Contracts and in the case where the relevant Borrower
has rescinded such Shipbuilding Contract either the Security Trustee has
received from the Seller or the Refund Guarantor all amounts to be
refunded under such Shipbuilding Contract or a period of 30 days (or such
longer period as the Agent may agree) has elapsed from the date of such
rescission whichever is the earlier;
or
|
|
(b)
|
any
of the Shipbuilding Contracts being cancelled, terminated, rescinded or
suspended or otherwise ceasing to remain in force for any reason and in
the case where the relevant Borrower has rescinded such Shipbuilding
Contract either the Security Trustee has received from the Seller or the
Refund Guarantor all amounts to be refunded under such Shipbuilding
Contract or a period of 30 days (or such longer period as the Agent may
agree) has elapsed from the date of such rescission whichever is the
earlier; or
|
|
(c)
|
any
of the Shipbuilding Contracts being amended or varied without the prior
written consent of the Majority Lenders except for any such amendments or
variation as is permitted by this Agreement or any other relevant Finance
Document; or
|
|
(d)
|
any
Ship not for any reason being delivered to, and accepted by, the relevant
Borrower under the relevant Shipbuilding Contract by the end of the
Availability Period applicable to the Loan to which that Ship relates;
or
|
|
(e)
|
the
rights of the Borrowers under any of the Shipbuilding Contracts are sold,
novated or assigned other than by way of security pursuant to the Finance
Documents.
|
|
9
|
CONDITIONS
PRECEDENT
|
|
9.1
|
Documents, fees and no
default. Each Lender’s obligation to contribute to an
Advance is subject to the following conditions
precedent:
|
|
(a)
|
that,
on or before the service of the first Drawdown Notice, the Agent receives
the documents described in Part A of Schedule 3 in form and substance
satisfactory to it;
|
|
(b)
|
that,
on or before a Drawdown Date but prior to the making of an Advance (other
than a Delivery Advance), the Agent receives the documents described in
Part B of Schedule 3 in form and substance satisfactory to
it;
|
|
(c)
|
that,
on or before the Drawdown Date but prior to the drawdown of a Delivery
Advance, the Agent receives the documents described in Part C of Schedule
3 in form and substance satisfactory to
it;
|
|
(d)
|
that,
on or before each Drawdown Date, the Agent has received all arrangement,
commitment and agency fees accrued due and payable pursuant to Clause 20.1;
|
|
(e)
|
that
at the date of each Drawdown Notice and on each Drawdown
Date:
|
|
(i)
|
no
Event of Default or Potential Event of Default has occurred and is
continuing or would result from the borrowing of the relevant
Advance;
|
|
(ii)
|
the
representations and warranties in Clause 10.1 and those of the Borrowers
or any Security Party which are set out in the other Finance Documents
would be true and not misleading if repeated on each of those dates with
reference to the circumstances then existing;
and
|
|
(iii)
|
none
of the circumstances contemplated by Xxxxxx 5.7 has occurred and is
continuing;
|
|
(f)
|
that,
if the ratio set out in Clause 15.1 were
applied immediately following the making of the relevant Advance, the
Borrowers would not be obliged to provide additional security or prepay
part of the Loans; and
|
|
(g)
|
that
the Agent has received, and found to be acceptable to it, any further
opinions, consents, agreements and documents in connection with the
Finance Documents which the Agent may, with the authorisation of the
Majority Lenders, reasonably request by notice to the Borrowers prior to
the Drawdown Date.
|
Provided that the Lenders
shall not be required to make an Advance if the Loans relating to Ships which
have not yet been delivered (but including the Advance being requested by the
Borrowers) exceed 75% of (i) the aggregate Contract Value of the Ships and (ii)
the net realisable value of any additional security provided under this
Agreement and for the purpose of this Clause, “Contract Value” shall
mean:
the
market value of a Ship at any date based on the acquisition price of the rights
and obligations under the Shipbuilding Contract relating to that Ship or a ship
of a similar size and type and due to be delivered at the same time as that Ship
as shown by a valuation prepared as at a date not more than 10 Business Days
previously by an independent international sale and purchase shipbroker which
the Agent has approved for the purpose and after deducting the estimated amount
of usual and reasonable expenses which would be incurred in connection with such
a sale.
|
9.2
|
Waiver of conditions
precedent. If all the Lenders or, in relation to a
condition which the Agent determines is non-material, the Majority
Lenders, at their discretion, permit an Advance to be borrowed before
certain of the conditions referred to in Clause 9.1 are satisfied, the Borrowers shall ensure
that those conditions are satisfied within 14 Business days after the
Drawdown Date (or such longer period as the Agent may, with the
authorisation of all the Lenders or (as the case may be) the Majority
Lenders, specify).
|
|
9.3
|
Pre-positioning of delivery
instalments under Shipbuilding Contracts. Notwithstanding the
foregoing provisions of Clause 9, in the event a Delivery Advance is
required to be drawndown prior to the satisfaction of the relevant
conditions precedent set out in Schedule 3 and remitted to the Seller’s
bank in accordance with Article II, 2.4 of the relevant Shipbuilding
Contract, the Agent may with the authorisation of the Majority Lenders
agree to remit such amount to the Seller’s bank prior to the satisfaction
of such conditions precedent provided
that:
|
|
(a)
|
the
amount remitted shall be held by the Seller’s bank in an account to the
order of the Agent;
|
|
(b)
|
such
amount will only be released to the Seller upon the Seller’s presentation
to the Seller’s bank of a copy of the protocol of delivery and acceptance
for the relevant Ship in the form agreed between the Seller and the
relevant Borrower and duly signed on behalf of the Agent by a person named
in the Agent’s remittance
instructions;
|
|
(c)
|
such
amount so released may only be used for payment to the account of the
Seller with the Seller’s bank in satisfaction of the delivery instalment
referred to in Article II, 2.3(e) of the relevant Shipbuilding
Contract;
|
|
(d)
|
in
the event that none of the said amount so remitted is released in
accordance with the Agent’s instructions or any part thereof is not so
released ten (or such longer period as the Agent may agree, up to a
maximum of thirty days) days after its receipt by the Seller’s bank the
money held by the Seller’s bank is returned to the account specified in
the Agent’s remittance
instructions;
|
|
(e)
|
the
relevant conditions precedent set out in Schedule 3 shall be satisfied
simultaneously with any release to the Seller pursuant to (b) above;
and
|
|
(f)
|
any
amounts so remitted and returned pursuant to (d) above will be applied in
or towards prepayment of the relevant Delivery Advance pursuant to Clause
8 but will continue to be available to the
Borrowers for borrowing subject to the terms and conditions of this
Agreement.
|
|
10
|
REPRESENTATIONS
AND WARRANTIES
|
|
10.1
|
General. Each
Borrower represents and warrants to each Creditor Party as
follows.
|
|
10.2
|
Status. It is
duly incorporated and validly existing and in good standing under the laws
of the Xxxxxxxx Islands.
|
|
10.3
|
Share capital and
ownership. It has an authorised share capital of 500
registered and/or bearer shares without par value all of which shares have
been issued, and the legal title and beneficial ownership of all those
shares is held, free of any Security Interest or other claim, by Xxxxxxxxx
Holdings Ltd.
|
|
10.4
|
Corporate
power. It has the corporate capacity, and has taken all
corporate action and obtained all consents necessary for
it:
|
|
(a)
|
to
execute the Shipbuilding Contract to which it is a party, to purchase and
pay for its Ship under that Shipbuilding Contract and to register such
Ship in its name in the Panamanian Ship
Registry;
|
|
(b)
|
to
execute the Bareboat Charter to which it is a party and to bareboat
charter its Ship to the Bareboat
Charterer;
|
|
(c)
|
to
execute the Finance Documents to which it is a party;
and
|
|
(d)
|
to
borrow under this Agreement and to make all the payments contemplated by,
and to comply with, those Finance
Documents.
|
|
10.5
|
Consents in
force. All the consents referred to in Clause 10.4 remain in force and nothing to the best of
the Borrower’s knowledge and belief has occurred which makes any of them
liable to revocation.
|
|
10.6
|
Legal validity; effective
Security Interests. The Finance Documents to which it is
a party, do now or, as the case may be, will, upon execution and delivery
(and, where applicable, registration as provided for in the Finance
Documents):
|
|
(a)
|
constitute
its legal, valid and binding obligations enforceable against it in
accordance with their respective terms;
and
|
|
(b)
|
create
legal, valid and binding Security Interests enforceable in accordance with
their respective terms over all the assets to which they, by their terms,
relate;
|
subject
to any relevant insolvency laws affecting creditors’ rights generally and
subject to any qualifications as to matters of law which are specifically
referred to in any legal opinion delivered to the Agent pursuant to Schedule
3.
|
10.7
|
No third party Security
Interests. Without limiting the generality of Clause 10.6, at the time of the execution and delivery
of each Finance Document:
|
|
(a)
|
the
relevant Borrower or Borrowers which are a party to that Finance Document
will have the right to create all the Security Interests which that
Finance Document purports to create;
and
|
|
(b)
|
no
third party will to the best of the Borrower’s knowledge and belief have
any Security Interest (except for Permitted Security Interests) or any
other interest, right or claim over, in or in relation to any asset to
which a Security Interest created by a Finance Document
relates.
|
|
10.8
|
No
conflicts. The execution by that Borrower of each
Finance Document to which it is a party, and the borrowing by that
Borrower of the Loans, and its compliance with each Finance Document to
which it is a party will not involve or lead to a contravention
of:
|
|
(a)
|
any
law or regulation in force at the date of this Agreement;
or
|
|
(b)
|
the
constitutional documents of that Xxxxxxxx;
or
|
|
(c)
|
any
contractual or other obligation or restriction which is binding on that
Borrower or any of its assets.
|
|
10.9
|
No withholding
taxes. No tax is imposed in any jurisdiction in which
that Xxxxxxxx is ordinarily resident for tax by way of withholding or
deduction or otherwise on any payment to be made under this
Agreement.
|
|
10.10
|
No
default. No Event of Default or Potential Event of
Default has occurred and is
continuing.
|
|
10.11
|
Information. All
information which has been provided in writing by or on behalf of the
Borrowers or any Security Party to any Creditor Party in connection with
any Finance Document was to the best of the Borrower’s knowledge and
belief true and not misleading as at the time it was given and all audited
and unaudited accounts which have been so provided satisfied the
requirements of Clause 11.7; and there has
been no material adverse change in the financial position or state of
affairs of the Borrowers from that disclosed in the latest of those
accounts.
|
|
10.12
|
No
litigation. No legal or administrative action involving
the Borrowers (including action relating to any alleged or actual breach
of the ISM Code or the ISPS Code) has been commenced or taken or, to that
Borrower’s knowledge, is likely to be commenced or taken which, in either
case, would be likely to have a material adverse effect on the Borrowers’
financial position or
profitability.
|
|
10.13
|
Validity and completeness of
Shipbuilding Contracts. Each Shipbuilding Contract
constitutes valid, binding and enforceable obligations of the Seller and
the relevant Borrower respectively in accordance with its terms subject to
any relevant insolvency laws attaching creditors’ rights generally
and:
|
|
(a)
|
each
copy of the Shipbuilding Contracts delivered to the Agent before the date
of this Agreement is a true and complete copy;
and
|
|
(b)
|
no
amendments or additions to the Shipbuilding Contracts have been agreed nor
has any Borrower or the Seller waived any of their respective rights under
the Shipbuilding Contracts.
|
|
10.14
|
No rebates
etc. There is no agreement or understanding to allow or
pay any rebate, premium, commission, discount or other benefit or payment
(howsoever described) to the Borrowers, the Seller or a third party in
connection with the purchase by the Borrowers of the Ships, other than as
disclosed to the Agent in writing on or prior to the date of this
Agreement.
|
|
10.15
|
|
10.16
|
Taxes
paid. Each Borrower has paid all taxes applicable to, or
imposed on or in relation to it, its business or its
Ships.
|
|
10.17
|
Money
laundering. Without prejudice to the generality of
Clause 2.3, in relation to the borrowing by
the Borrowers of the Loan Facility, the performance and discharge of their
obligations and liabilities under the Finance Documents, and the
transactions and other arrangements affected or contemplated by the
Finance Documents to which the Borrowers or any of them are a party, each
Borrower confirms (i) that it is acting for its own
account; (ii) that it will use the proceeds of the Loans for
its own benefit, under its full responsibility and exclusively for the
purposes specified in this Agreement; and (iii) that the foregoing will
not involve or lead to a contravention of any law, official requirement or
other regulatory measure or procedure implemented and in force to combat
“money laundering” (as defined in Article 1 of Directive (91/308/EEC)
of the Council of the European
Communities).
|
|
10.18
|
Conformity
of Financial Covenants and Dividend
Restrictions.
|
|
(a)
|
The
financial covenants set out in Schedule 8 conform to the financial
covenants given by the New Corporate Guarantor and its subsidiaries under
the Bank of America Facilities.
|
|
(b)
|
The
dividend restrictions in Clause 11.21 conform in substance to the dividend
restrictions imposed on the New Corporate Guarantor under the Bank of
America Facilities.
|
|
10.19
|
Charters with TBS Worldwide to
which Borrowers are a party. Any charter which a
Borrower shall enter into with TBS Worldwide shall be on terms comparable
to, as far as charterhire is concerned, the time charter dated 10 May
2005, a copy of which was previously delivered to the
Agent.
|
|
10.20
|
Shareholder
loans. All shareholder loans and inter-company
Indebtedness made available to the Borrowers (or any of them) shall be
made by the Shareholder.
|
|
11
|
GENERAL
UNDERTAKINGS AND FINANCIAL
COVENANTS
|
|
11.1
|
General. Each
Borrower undertakes with each Creditor Party to comply with the following
provisions of this Clause 11 at all times
during the Security Period except as the Agent may, with the authorisation
of the Majority Lenders otherwise
permit.
|
|
11.2
|
Title; negative
pledge. Each Borrower will keep its rights under the
Shipbuilding Contract and Refund Guarantees to which it is a party, and
with effect from the Delivery Date of the Ship, will hold the legal title
to, and own the entire beneficial interest in its Ship, its Insurances and
Earnings, in each case free from all Security Interests and other
interests and rights of every kind, except for Permitted Security
Interests.
|
|
11.3
|
No disposal of
assets. Save pursuant to the relevant Bareboat Charter
or in the case of the disposal of a Ship or a Shipbuilding Contract where
the provisions of Clause 8.7 are complied
with, no Borrower will transfer, lease or otherwise dispose
of:
|
|
(a)
|
its
Ship or its rights under the Shipbuilding Contract to which it is a party
or all or a substantial part of its other assets, whether by one
transaction or a number of transactions, whether related or not;
or
|
|
(b)
|
any
debt payable to it or any other right (present, future or contingent
right) to receive a payment, including any right to damages or
compensation.
|
|
11.4
|
No other liabilities or
obligations to be incurred. No Borrower will incur any
liability or obligation except
|
|
(a)
|
liabilities
and obligations under the Shipbuilding Contract, the Bareboat Charter, the
First Sub-Time Charter, the Second Sub-Time Charter, the Finance
Documents, the Guarantee Facility Agreement and the Finance Documents (as
defined in the Guarantee Facility Agreement) to which it is a party;
and
|
|
(b)
|
liabilities
or obligations incurred in the ordinary course of supervising the
construction of, providing supplies for, operating and chartering its Ship
(and for the avoidance of doubt the management fees payable by the
Borrowers to the Approved Managers may be a permitted expense);
and
|
|
(c)
|
provided
the terms of Clause 12.3(c) are complied with, inter-company
Indebtedness from other companies which are in the same ultimate
beneficial ownership as the
Borrowers.
|
|
11.5
|
Information provided to be
accurate. All financial and other information which is
provided in writing by or on behalf of each Borrower under or in
connection with any Finance Document will to the best of that Xxxxxxxx’s
knowledge and belief be true and not misleading and will not omit any
material fact or consideration which, if disclosed, would reasonably be
expected to adversely affect the decision of a person considering whether
to enter into this Agreement.
|
|
11.6
|
Provision of financial
statements. Each Borrower will procure that there is
sent to the Agent:
|
|
(a)
|
as
soon as possible, but in no event later than 120 days after the end of
each of the Corporate Guarantor’s and the New Corporate Guarantor’s
financial years, the annual audited accounts of the Corporate Guarantor
and the New Corporate Guarantor and each of their consolidated
subsidiaries;
|
|
(b)
|
as
soon as possible, but in no event later than 30 days after the end of each
quarter in each of the Corporate Guarantor’s and the New Corporate
Guarantor’s financial years:
|
|
(i)
|
the
unaudited accounts of the Corporate Guarantor and the New Corporate
Guarantor and each of their consolidated subsidiaries which are certified
as to their correctness by its chief financial officer;
and
|
|
(ii)
|
with
effect from the relevant Delivery Date of its Ship management accounts in
a format approved by the Agent which show the results of the operation of
its Ship during the preceding financial quarter and which are certified as
to their correctness by its chief financial
officer;
|
|
(c)
|
as
soon as possible, but in no event later than 3 months after the end of
each of its financial years (but only with effect from the relevant
Delivery Date of its Ship), a budget in a format approved by the Agent
which shows all anticipated income and expenditure of its Ship during its
next financial year;
|
|
(d)
|
by
the New Corporate Guarantor on a monthly basis, and in no event later than
the 20th day of each month, monthly management information including
information from the preceding month in respect of sales, operating
profit, net income, EBITDA and available liquidity each on a consolidated
basis and each compared against the relevant budget numbers for that
month; and
|
|
(e)
|
by
the New Corporate Guarantor on a monthly basis, and in no event later than
the 30th day of each month, updated financial projections including but
not limited to revenues, operating expenses, net income, cash balances,
loan balances, working capital requirements and equity for the period up
to and including the following 24
months.
|
|
11.7
|
Form of financial
statements. All accounts (audited and unaudited)
delivered under Clause 11.6
will:
|
|
(a)
|
be
prepared in accordance with all applicable laws and generally accepted
accounting principles of the U.S.A. consistently
applied;
|
|
(b)
|
give
a true and fair view of the financial condition of the relevant Borrower
at the date of those accounts and of its profit for the period to which
those accounts relate;
|
|
(c)
|
fully
disclose or provide for all significant liabilities of the relevant
Borrower.
|
|
11.8
|
Shareholder and creditor
notices. Each Borrower will send the Agent, at the same
time as they are despatched, copies of all communications which are
despatched to its shareholders or creditors or any class of
them.
|
|
11.9
|
Consents. Each
Borrower will maintain in force and promptly obtain or renew, and will
promptly send certified copies to the Agent of, all consents
required:
|
|
(a)
|
for
that Borrower to perform its obligations under any Finance Document to
which it is a party;
|
|
(b)
|
for
the validity or enforceability of any Finance Document to which it is a
party;
|
|
(c)
|
for
that Borrower to continue to own, charter and operate its
Ship;
|
and the
Borrower will comply with the terms of all such consents.
|
11.10
|
Maintenance of Security
Interests. Each Borrower
will:
|
|
(a)
|
at
its own cost, do all that is necessary to ensure that any Finance Document
validly creates the obligations and the Security Interests which it
purports to create; and
|
|
(b)
|
without
limiting the generality of paragraph (a), at its own cost, promptly
register, file, record or enrol any Finance Document with any applicable
court or authority, pay any applicable stamp, registration or similar tax
in respect of any Finance Document, give any notice or take any other step
which, in the reasonable opinion of the Majority Lenders, is or has become
necessary or desirable for any Finance Document to be valid, enforceable
or admissible in evidence or to ensure or protect the priority of any
Security Interest which it creates.
|
|
11.11
|
Notification of
litigation. Each Borrower will provide the Agent with
details of any legal or administrative action involving any Borrower, any
Security Party, the Approved Managers or the Ships, their Earnings or the
Insurances promptly upon becoming aware of the same where such legal or
administrative action might, if adversely determined, have a material
adverse effect on the ability of that Borrower to perform its obligations
under any Finance Document to which it is a
party.
|
|
11.12
|
No amendment to Shipbuilding
Contracts. No Borrower will agree to any material
amendment or supplement to, or waive or fail to enforce, the Shipbuilding
Contract to which it is a party or any of its provisions (and for the
purposes of this Clause 11.12 an amendment of
a Shipbuilding Contract will always be material if alone or with any
previous variations it increases the Contract Price thereunder by more
than 5%).
|
|
11.13
|
Chief Executive
Office. Each Borrower will maintain its chief executive
office, and keep its corporate documents and records, at Suite 000,
Xxxxxxxx Xxxxxxxx, Xxx Xxxxxxxx Xxxx, Xxxxxxxx, XX00,
Xxxxxxx.
|
|
11.14
|
Confirmation of no
default. Each Borrower will, within 2 Business Days
after service by the Agent of a written request, serve on the Agent a
notice which is signed by the representative director of such Borrower and
which:
|
|
(a)
|
states
that no Event of Default or Potential Event of Default has occurred and is
continuing; or
|
|
(b)
|
states
that no Event of Default or Potential Event of Default has occurred,
except for a specified event or matter, of which all material details are
given.
|
|
11.15
|
Notification of
default. Each Borrower will notify the Agent as soon as
it becomes aware of:
|
|
(a)
|
the
occurrence of an Event of Default or a Potential Event of Default;
or
|
|
(b)
|
any
matter which indicates that an Event of Default or a Potential Event of
Default may have occurred and is
continuing;
|
and will
keep the Agent fully up-to-date with all developments.
|
11.16
|
Provision of further
information. Each Borrower will, as soon as practicable
after receiving the request, provide the Agent with any additional
financial or other information
relating:
|
|
(a)
|
to
it, its Ship, her Earnings or Insurances;
or
|
|
(b)
|
to
any other matter relevant to, or to any provision of, a Finance
Document;
|
which may
be reasonably requested by the Agent, the Security Trustee or any Lender at any
time.
|
11.17
|
Provision of copies and
translation of documents. Each Borrower will supply the
Agent with a sufficient number of copies of the documents referred to
above to provide 1 copy for each Creditor Party; and if the Agent so
requires in respect of any of those documents, such Borrower will provide
a certified English translation prepared by a translator approved by the
Agent.
|
|
11.18
|
Financial
Covenants.
|
|
(i)
|
The
Borrowers undertake to comply at all times with the financial covenants
set out in Schedule 8.
|
|
(ii)
|
The
Borrowers shall provide to the Agent within 60 days after the end of each
financial quarter of the New Corporate Guarantor’s financial year a
compliance certificate in the form set out in Schedule 9 executed by the
chief financial officer of the New Corporate Guarantor and confirming that
the Financial Covenants set out in Schedule 8 have been complied with
during each financial quarter.
|
|
(iii)
|
A
formal review of the financial covenants set out in Schedule 8 will be
undertaken by the Agent, having consulted and received the written
agreement of the Lenders, upon expiry and prepayment of the Bank of
America Facilities whichever is the
earlier.
|
|
(iv)
|
The
parties to this Agreement shall review the financial covenants set out in
Schedule 8 on or around 1 May 2012.
|
|
11.19
|
Operational business of TBS
Pacific Liner. The Borrowers undertake to procure that
TBS Pacific Liner opens the Earnings Account with the Agent no later than
30 June 2007 and that thereafter and throughout the Security Period (i)
all of the operational business of TBS Pacific Liner shall be conducted
through the Earnings Account and (ii) TBS Pacific Liner does not operate
accounts with any banks other than the Agent (save that the Creditor
Parties agree there may be a transitional period of up to 6 months from
the date of opening the Earnings Account until all operational business of
TBS Pacific Liner is completely transferred and all other accounts of TBS
Pacific Liner which are currently with other banks are
closed).
|
|
11.20
|
Designated
Transactions. The Borrowers hereby undertake that on the
Drawdown Date in respect of an Advance they shall hedge the
interest rate payable in respect of such Advance for the period for which
such Advance is scheduled to be outstanding by entering into a Designated
Transaction with the Swap Bank pursuant to the Master
Agreement.
|
|
11.21
|
No Dividends. As
long as no Event of Default has occurred or would occur as a result of the
payment of any dividend or the making of any distribution the Borrowers
may pay any dividends or make other forms of distributions to the New
Corporate Guarantor. The Borrowers shall procure that the New
Corporate Guarantor does not pay any dividend or make any other form of
distribution Provided
that so long as no Event of Default has occurred or would occur as
a result of the payment of any dividend or the making of any distribution
the New Corporate Guarantor may withhold stock in order that it be sold
and the proceeds used solely to pay any payroll withholding taxes as
required in connection with stock bonuses made to employees of the New
Corporate Guarantor and its
subsidiaries.
|
|
11.22
|
Financial Covenants in other
facilities. The Borrowers undertake to provide and to
procure that the New Corporate Guarantor provides the Creditor Parties
with the benefit of any additional or more favourable financial covenants
provided to other financing parties under other or future financing
agreements in order that the Creditor Parties shall be treated no less
favourably than any other of the financing parties to the New Corporate
Guarantor and/or any of its subsidiaries by providing details of such
financial covenants in order that appropriate amendments can be made by
this Agreement and the relevant Finance
Documents.
|
|
11.23
|
Equity
Contributions. The Borrowers shall ensure that all
amounts due under the Shipbuilding Contracts other than those amounts
being financed by a Loan under this Agreement shall be paid from operating
cashflow and the Borrowers shall not use any monies credited to the
Restricted Equity Deposit Account until the Agent has notified the
Borrowers that it is satisfied that the amount standing to the credit of
the Restricted Equity Deposit Account is sufficient to meet all remaining
amounts due under the Shipbuilding Contracts other than those amounts
being financed by a Loan under this Agreement. The Borrowers
shall further ensure that any further equity raised by the New Corporate
Guarantor shall be utilised in meeting the Borrowers’ equity contributions
as required under this Clause in the first instance and any balance
thereafter shall promptly be credited to the Restricted Equity Deposit
Account. Any amount of equity raised over such amounts required to fund
equity contributions in respect of amounts due under the Shipbuilding
Contracts other than those amounts being financed by a Loan under this
Agreement shall not be credited to the Restricted Equity Deposit Account
but shall be used to prepay all loans and indebtedness owed by the New
Corporate Guarantor and its subsidiaries to Bank of America, The Royal
Bank of Scotland plc, DVB Group Merchant Bank (Asia) Ltd., Credit Suisse,
AIG Commercial Equipment Finance, Inc., Commerzbank AG and Berenberg Bank
under loan or facility agreements entered into with them on a pro rata
basis. Any prepayment of the Loans under this Clause shall be
applied to all Loans on a pro rata basis in accordance with Clause
8.
|
|
11.24
|
Operating
Leases. The Borrowers shall ensure that neither the New
Corporate Guarantor nor any of its subsidiaries shall permit any new or
increase their existing off balance sheet operating leases, operating
lease payments and payments associated with vessels chartered in for more
than 12 months without the prior written consent of the Agent acting on
the instructions of the Majority Lenders. In no circumstances
shall any such off-balance sheet operating obligations exceed $45,000,000
when aggregated.
|
|
11.25
|
Additional
Vessels. The Borrowers shall not and shall procure that
the New Corporate Guarantor or any of its subsidiaries do not purchase any
additional vessels without the prior written consent of the Agent acting
on the instructions of the Majority
Lenders.
|
|
11.26
|
Investments in Joint
Ventures. The Borrowers, the Corporate Guarantor and the
New Corporate Guarantor acting individually or together shall not invest
more than $10,000,000 in aggregate in any Joint Ventures of which any
amounts in excess of $5,000,000 shall require the prior written consent of
the Agent acting on the instructions of the Majority Lenders. For the
avoidance of doubt, the $10,000,000 amount referred to above shall include
all Joint Venture investments made on or after 27 March
2009.
|
|
12
|
CORPORATE
UNDERTAKINGS
|
|
12.1
|
General. Each
Borrower also undertakes with each Creditor Party to comply with the
following provisions of this Clause 12 at all
times during the Security Period except as the Agent may, with the
authorisation of the Majority Lenders, otherwise
permit.
|
|
12.2
|
Maintenance of
status. Each Borrower will maintain its separate
corporate existence and remain in good standing under the laws of the
Xxxxxxxx Islands.
|
|
12.3
|
Negative
undertakings. No Borrower
will:
|
|
(a)
|
carry
on any business other than in relation to the construction, purchase and
eventual ownership, chartering and operation of its Ship;
or
|
|
(b)
|
effect
any form of redemption, purchase or return of share capital;
or
|
|
(c)
|
provide
any form of credit or financial assistance
to:
|
|
(i)
|
a
person who is directly or indirectly interested in that Xxxxxxxx’s share
or loan capital; or
|
|
(ii)
|
any
company in or with which such a person is directly or indirectly
interested or connected;
|
or enter
into any transaction with or involving such a person or company on terms which
are, in any respect, less favourable to that Borrower than those which it could
obtain in a bargain made at arms’ length provided however that prior to an Event
of Default which is continuing that Borrower may provide loans to or incur
inter-company Indebtedness from other subsidiaries of the New Corporate
Guarantor and may service such inter-company Indebtedness provided that in the
case of any such inter-company Indebtedness the relevant lending company has
first executed an agreement in favour of the Security Trustee fully
subordinating the rights of such lending company in respect of such Indebtedness
to those of the Creditor Parties under the Finance Documents and assigning its
rights in respect of any loan agreements relating to such inter-company
Indebtedness made between it and the Borrowers;
|
(d)
|
issue,
allot or grant any person a right to any shares in its capital or
repurchase or reduce its issued share
capital;
|
|
(e)
|
acquire
any shares or other securities other than US or UK Treasury bills and
certificates of deposit issued by major North American or European banks,
or enter into any transaction in a derivative;
or
|
|
(f)
|
enter
into any form of amalgamation, merger or de-merger or any form of
reconstruction or reorganisation.
|
|
13
|
INSURANCE
|
|
13.1
|
General. Each
Borrower also undertakes with each Creditor Party to comply with the
following provisions of this Clause 13 in
respect of each Ship at all times during the Security Period after that
Ship has been delivered to it under the relevant Shipbuilding Contract
except as the Agent may, with the authorisation of the Majority Lenders,
otherwise permit.
|
|
13.2
|
Maintenance of obligatory
insurances. Each Borrower shall keep its Ship insured at
its expense against:
|
|
(a)
|
fire
and usual marine risks (including hull and machinery and excess
risks);
|
|
(b)
|
war
risks;
|
|
(c)
|
protection
and indemnity risks; and
|
|
(d)
|
any
other risks against which the Agent considers, having regard to practices
and other circumstances prevailing at the relevant time, it would in the
reasonable opinion of the Agent be reasonable for a prudent owner to
insure and which are specified by the Agent by notice to the
Borrower.
|
|
13.3
|
Terms of obligatory
insurances. Such insurances in relation to a Ship shall
be effected by the Borrowers:
|
|
(a)
|
in
Dollars;
|
|
(b)
|
in
the case of fire and usual marine risks and war risks, in an amount on an
agreed value basis at least the greater of (i) One hundred and twenty per
cent. (120%) of the Loan in respect of such Ship and (ii) the market value
of such Ship;
|
|
(c)
|
in
the case of oil pollution liability risks, for an aggregate amount equal
to the highest level of cover from time to time available under basic
protection and indemnity club entry and in the international marine
insurance market;
|
|
(d)
|
in
relation to protection and indemnity risks in respect of the full tonnage
of such Ship;
|
|
(e)
|
on
approved terms; and
|
|
(f)
|
through
approved brokers and with approved insurance companies and/or underwriters
or, in the case of war risks and protection and indemnity risks, in
approved war risks and protection and indemnity risks associations and
without prejudice to the Borrowers’ obligation to obtain the prior
approval of the Agent such approval not to be unreasonably withheld, at
all times with reputable international brokers, companies, underwriters
and mutual insurance associations.
|
|
13.4
|
Further protections for the
Creditor Parties. In addition to the terms set out in
Clause 13.3, each Borrower shall use its best
endeavours to procure that the obligatory insurances
shall:
|
|
(a)
|
whenever
the Security Trustee requires, name (or be amended to name) the Security
Trustee as additional named assured for its rights and interests,
warranted no operational interest and with full waiver of rights of
subrogation against the Security Trustee, but without the Security Trustee
thereby being liable to pay (but having the right to pay) premiums, calls
or other assessments in respect of such
insurance;
|
|
(b)
|
name
the Security Trustee as loss payee with such directions for payment as the
Security Trustee may reasonably
specify;
|
|
(c)
|
provide
that all payments by or on behalf of the insurers under the obligatory
insurances to the Security Trustee shall be made without set-off,
counterclaim or deductions or condition
whatsoever;
|
|
(d)
|
provide
that the insurers shall waive, to the fullest extent permitted by English
law, their entitlement (if any) (whether by statute, common law, equity,
or otherwise) to be subrogated to the rights and remedies of the Agent in
respect of any rights or interests (secured or not) held by or available
to the Agent under the Finance Documents, until the Secured Liabilities
shall have been fully repaid and discharged, except that the insurers
shall not be restricted by the terms of this paragraph (d) from making
personal claims against persons (other than the Borrowers or any other
Creditor Party) in circumstances where the insurers have fully discharged
their liabilities and obligations under the relevant obligatory
insurances;
|
|
(e)
|
provide
that such obligatory insurances shall be primary without right of
contribution from other insurances which may be carried by the Security
Trustee or any other Creditor
Party;
|
|
(f)
|
provide
that the Security Trustee may make proof of loss if the Borrowers fail to
do so; and
|
|
(g)
|
provide
so far as possible that if any obligatory insurance is cancelled, or if
any substantial change is made in the coverage which adversely affects the
interest of the Agent, or if any obligatory insurance is allowed to lapse
for non-payment of premium, such cancellation, charge or lapse shall not
be effective with respect to the Agent for 30 days (or 7 days in the case
of war risks) after receipt by the Agent of prior written notice from the
insurers of such cancellation, change or
lapse.
|
|
13.5
|
Renewal of obligatory
insurances. The Borrowers
shall:
|
|
(a)
|
at
least 14 days before the expiry of any obligatory insurance effected by
it:
|
|
(i)
|
notify
the Security Trustee of the brokers (or other insurers) and any protection
and indemnity or war risks association through or with whom the Borrowers
propose to renew that obligatory insurance and of the proposed terms of
renewal; and
|
|
(ii)
|
obtain
the Security Trustee’s approval to the matters referred to in paragraph
(i) such approval not to be unreasonably
withheld;
|
|
(b)
|
at
least 7 days before the expiry of any obligatory insurance effected by it,
renew that obligatory insurance in accordance with the Security Trustee’s
approval pursuant to paragraph (a);
and
|
|
(c)
|
use
its best endeavours to procure that the approved brokers and/or the war
risks and protection and indemnity associations with which such a renewal
is effected shall promptly after the renewal notify the Security Trustee
in writing of the terms and conditions of the
renewal.
|
|
13.6
|
Copies of policies; letters of
undertaking. The Borrowers shall ensure that all
approved brokers provide the Security Trustee with pro forma copies of all
policies relating to the obligatory insurances which they are to effect or
renew and of a letter or letters or undertaking in a form required by the
Security Trustee and including undertakings by the approved brokers
that:
|
|
(a)
|
they
will have endorsed on each policy, immediately upon issue, a loss payable
clause and a notice of assignment complying with the provisions of Clause
13.4;
|
|
(b)
|
they
will hold such policies, and the benefit of such insurances, to the order
of the Security Trustee in accordance with the said loss payable
clause;
|
|
(c)
|
they
will advise the Security Trustee immediately of any material change to the
terms of the obligatory insurances;
|
|
(d)
|
they
will notify the Security Trustee, not less than 10 days before the expiry
of the obligatory insurances, in the event of their not having received
notice of renewal instructions from the Borrowers or their agents and, in
the event of their receiving instructions to renew, they will promptly
notify the Security Trustee of the terms of the instructions;
and
|
|
(e)
|
they
will not set off against any sum recoverable in respect of a claim
relating to a Ship under such obligatory insurances any premiums or other
amounts due to them or any other person whether in respect of that Ship or
otherwise, they waive any lien on the policies, or any sums received under
them, which they might have in respect of such premiums or other amounts,
and they will not cancel such obligatory insurances by reason of
non-payment of such premiums or other amounts, and will arrange for a
separate policy to be issued in respect of that Ship forthwith upon being
so requested by the Security
Trustee.
|
|
13.7
|
Copies of certificates of
entry. The Borrowers shall ensure that any protection
and indemnity and/or war risks associations in which a Ship is entered
provides the Security Trustee with:
|
|
(a)
|
a
certified copy of the certificate of entry for that
Ship;
|
|
(b)
|
a
letter or letters of undertaking in such form as may be reasonably
required by the Security Trustee;
and
|
|
(c)
|
a
certified copy of each certificate of financial responsibility for
pollution by oil or other Environmentally Sensitive Material issued by the
relevant certifying authority in relation to that
Ship.
|
|
13.8
|
Deposit of original
policies. The Borrowers shall ensure that all policies
relating to obligatory insurances effected by it are deposited with the
approved brokers through which the insurances are effected or
renewed.
|
|
13.9
|
Payment of
premiums. The Borrowers shall punctually pay all
premiums or other sums payable in respect of the obligatory insurances
effected by it and produce all relevant receipts when so required by the
Security Trustee.
|
|
13.10
|
Guarantees. The
Borrowers shall ensure that any guarantees required by a protection and
indemnity or war risks association are promptly issued and remain in full
force and effect.
|
|
13.11
|
Restrictions on
employment. The Borrowers shall not employ the Ships,
nor permit them to be employed, outside the cover provided by any
obligatory insurances.
|
|
13.12
|
Compliance with terms of
insurances. The Borrowers shall not do nor omit to do
(nor permit to be done or not to be done) any act or thing which would or
might render any obligatory insurance invalid, void, voidable or
unenforceable or render any sum payable under an obligatory insurance
repayable in whole or in part; and, in
particular:
|
|
(a)
|
the
Borrowers shall take all necessary action and comply with all requirements
which may from time to time be applicable to the obligatory insurances,
and (without limiting the obligation contained in Clause 13.7(c)) ensure that the obligatory insurances
are not made subject to any exclusions or qualifications to which the
Security Trustee has not given its prior
approval;
|
|
(b)
|
the
Borrowers shall not make any changes relating to the classification or
classification society or manager or operator of the Ships approved by the
underwriters of the obligatory
insurances;
|
|
(c)
|
the
Borrowers shall make (and promptly supply copies to the Agent of) all
quarterly or other voyage declarations which may be required by the
protection and indemnity risks association in which the Ships are entered
to maintain cover for trading to the United States of America and
Exclusive Economic Zone (as defined in the United States Oil Pollution Act
1990 or any other applicable legislation);
and
|
|
(d)
|
the
Borrowers shall not employ the Ships, nor allow them to be employed,
otherwise than in conformity with the terms and conditions of the
obligatory insurances, without first obtaining the consent of the insurers
and complying with any requirements (as to extra premium or otherwise)
which the insurers specify.
|
|
13.13
|
Alteration to terms of
insurances. The Borrowers shall not either make or agree
to any alteration to the terms of any obligatory insurance nor waive any
right relating to any obligatory
insurance.
|
|
13.14
|
Settlement of
claims. The Borrowers shall not either settle,
compromise or abandon any claim under any obligatory insurance for Total
Loss or for a Major Casualty unless the Agent is satisfied that such
release, compromise or abandonment will not prejudice any of the Lenders’
interests, and the Borrowers shall do all things necessary and provide all
documents, evidence and information to enable the Security Trustee to
collect or recover any moneys which at any time become payable in respect
of the obligatory insurances.
|
|
13.15
|
Provision of copies of
communications. The Borrowers shall provide the Security
Trustee, at the time of each such communication, copies of all written
communications between the Borrowers
and:
|
|
(a)
|
the
approved brokers; and
|
|
(b)
|
the
approved protection and indemnity and/or war risks associations;
and
|
|
(c)
|
the
approved insurance companies and/or
underwriters,
|
which
relate directly or indirectly to:
|
(i)
|
the
obligations of the Borrowers relating to the obligatory insurances
including, without limitation, all requisite declarations and payments of
additional premiums or calls; and
|
|
(ii)
|
any
credit arrangements made between the Borrowers and any of the persons
referred to in paragraphs (a) or (b) relating wholly or partly to the
effecting or maintenance of the obligatory
insurances.
|
|
13.16
|
Provision of
information. In addition, the Borrowers shall promptly
provide the Security Trustee (or any persons which it may designate) with
any information which the Security Trustee (or any such designated person)
reasonably requests for the purpose
of:
|
|
(a)
|
obtaining
or preparing any report from an independent marine insurance broker as to
the adequacy of the obligatory insurances effected or proposed to be
effected; and/or
|
|
(b)
|
effecting,
maintaining or renewing any such insurances as are referred to in Clause
13.16 or dealing with or considering any
matters relating to any such
insurances;
|
and the
Borrowers shall, forthwith upon demand, indemnify the Security Trustee in
respect of all fees and other expenses properly incurred by or for the account
of the Security Trustee in connection with any such report as is referred to in
paragraph (a).
|
13.17
|
Mortgagee’s interest,
additional perils. The Security Trustee shall be
entitled from time to time to effect, maintain and renew a mortgagee’s
interest additional perils insurance and a mortgagee’s interest marine
insurance in relation to each Ship the subject of a Mortgage, in each case
in an amount, which when aggregated with any such insurance policy taken
out in relation to the other Ships then the subject of a Mortgage is equal
to one hundred and ten per cent. (110%) of the Loans or part thereof at
the discretion of the Security Trustee, on such terms, through such
insurers and generally in such manner as the Security Trustee may from
time to time consider appropriate and the Borrowers shall upon demand
fully indemnify the Security Trustee in respect of all premiums and other
expenses which are incurred in connection with or with a view to
effecting, maintaining or renewing any such insurance or dealing with, or
considering, any matter arising out of any such
insurance.
|
|
13.18
|
Review of insurance
requirements. The Agent may and, on instruction of the
Majority Lenders, shall review the requirements of this Clause 13 from time to time in order to take account of
any changes in circumstances after the date of this Agreement which are,
in the reasonable opinion of the Agent or any Lender significant and
capable of affecting the Borrowers or the Ships and their insurance
(including, without limitation, changes in the availability or the cost of
insurance coverage or the risks to which the Borrowers may be
subject).
|
|
13.19
|
Modification of insurance
requirements. The Agent shall notify the Borrowers of
any proposed modification under Clause 13.18 to the requirements of this
Clause 13 which the Agent, may or, on
instruction of the Majority Lenders, shall reasonably consider
appropriate, in the circumstances and, after consultation and taking full
account of the Borrower’s opinions, such modification shall take effect on
and from the date it is notified in writing to the Borrowers as an
amendment to this Clause 13 and shall bind
the Borrowers accordingly.
|
|
14
|
SHIP
COVENANTS
|
|
14.1
|
General. Each
Borrower also undertakes with each Creditor Party to comply with the
following provisions of this Clause 14 in
respect of each Ship at all times during the Security Period after that
Ship has been delivered to it under the relevant Shipbuilding Contract
except as the Agent, with the authorisation of the Majority Lenders, may
otherwise permit.
|
|
14.2
|
Ship’s name and
registration. Each Borrower shall keep its Ship
registered in its name in the Panamanian ship registry; shall not do or
allow to be done anything as a result of which such registration might be
cancelled or imperilled; and shall not change the name or port of registry
of its Ship.
|
|
14.3
|
Repair and
classification. Each Borrower shall keep its Ship in a
good and safe condition and state of
repair:
|
|
(a)
|
consistent
with first-class ship ownership and management
practice;
|
|
(b)
|
so
as to maintain such Ship’s present Classification in each case free
of recommendations and conditions affecting that Ship’s
Classification; and
|
|
(c)
|
so
as to comply with all laws and regulations applicable to vessels
registered at ports in the Republic of Panama or to vessels trading to any
jurisdiction to which that Ship may trade from time to time, including but
not limited to the ISM Code and the ISPS
Code.
|
|
14.4
|
Modification. The
Borrowers shall not make any modification or repairs to, or replacement
of, any Ship or equipment installed on it which would or might materially
alter the structure, type or performance characteristics of that Ship or
materially reduce its value.
|
|
14.5
|
Removal of
parts. The Borrowers shall not remove any material part
of any Ship, or any item of equipment installed on, any Ship unless the
part or item so removed is forthwith replaced by a suitable part or item
which is in the same condition as or better condition than the part or
item removed, is free from any Security Interest or any right in favour of
any person other than the Security Trustee and becomes on installation on
the relevant Ship the property of the relevant Borrower and subject to the
security constituted by the relevant Mortgage Provided that the
Borrowers may install equipment owned by a third party if the equipment
can be removed without any risk of damage to the relevant
Ship.
|
|
14.6
|
Surveys. The
Borrowers shall submit the Ships regularly to all periodical or other
surveys which may be required for classification purposes and, if so
required by the Security Trustee provide the Security Trustee, with copies
of all survey reports.
|
|
14.7
|
Inspection. The
Borrowers shall permit the Security Trustee (by surveyors or other persons
appointed by it for that purpose) to board the Ships at all reasonable
times and without interference to their itineraries to inspect their
condition or to satisfy themselves about proposed or executed repairs and
shall afford all proper facilities for such
inspections.
|
|
14.8
|
Prevention of and release from
arrest. The Borrowers shall promptly
discharge:
|
|
(a)
|
all
liabilities which give or may give rise to maritime or possessory liens on
or claims enforceable against the Ships, their Earnings or the
Insurances;
|
|
(b)
|
all
taxes, dues and other amounts charged in respect of the Ships, their
Earnings or the Insurances; and
|
|
(c)
|
all
other outgoings whatsoever in respect of the Ships, their Earnings or the
Insurances;
|
|
|
and,
upon receiving notice of the arrest of a Ship, or of its detention in
exercise or purported exercise of any lien or claim, the Borrowers shall
procure its release by providing bail or otherwise as the circumstances
may require as soon as practicable and in any event within 14
days.
|
|
14.9
|
Compliance with laws
etc. The Borrowers
shall:
|
|
(a)
|
comply,
or procure compliance with the ISM Code, the ISPS Code, all Environmental
Laws and all other laws or regulations relating to the Ships, their
ownership, operation and management or to the business of the
Borrowers;
|
|
(b)
|
not
employ the Ships nor allow their employment in any manner contrary to any
law or regulation in any relevant jurisdiction including but not limited
to the ISM Code and the ISPS Code;
and
|
|
(c)
|
in
the event of hostilities in any part of the world (whether war is declared
or not), not cause or permit any Ship to enter or trade to any zone which
is declared a war zone by any government or by the Ship’s war risks
insurers unless the prior written consent of the Security Trustee has been
given and the Borrowers have (at their expense) effected any special,
additional or modified insurance cover which the Security Trustee may
require.
|
|
14.10
|
Provision of
information. The Borrowers shall promptly provide the
Security Trustee with any information which it reasonably requests
regarding:
|
|
(a)
|
the
Ships, their employment, position and
engagements;
|
|
(b)
|
the
Earnings and payments and amounts due to the master and crew of the
Ships;
|
|
(c)
|
any
expenses incurred, or likely to be incurred, in connection with the
operation, maintenance or repair of the Ships and any payments made in
respect of the Ships;
|
|
(d)
|
any
towages and salvages;
|
|
(e)
|
its
compliance, the Approved Managers’ compliance and the compliance of the
Ships with the ISM Code and the ISPS
Code;
|
|
|
and,
upon the Security Trustee’s request, provide copies of any current charter
relating to any Ship, of any current charter guarantee and copies of a
Ship’s Document of Compliance.
|
|
|
The
Agent shall communicate any of the above information to any one of the
Lenders upon receiving written demand subject to receipt of the same from
the Borrower.
|
|
14.11
|
Notification of certain
events. The Borrowers shall immediately notify the
Security Trustee by fax, confirmed forthwith by letter,
of:
|
|
(a)
|
any
casualty which is or is likely to be or to become a Major
Casualty;
|
|
(b)
|
any
occurrence as a result of which any Ship has become or is, by the passing
of time or otherwise, likely to become a Total
Loss;
|
|
(c)
|
any
requirement or recommendation made by any insurer or classification
society or by any competent authority which is not immediately complied
with;
|
|
(d)
|
any
arrest or detention of a Ship, any exercise or purported exercise of any
lien on a Ship or its Earnings or any requisition of a Ship for
hire;
|
|
(e)
|
any
intended dry docking of a Ship;
|
|
(f)
|
any
Environmental Claim made against any Borrower or in connection with a
Ship, or any Environmental
Incident;
|
|
(g)
|
any
claim for breach of the ISM Code or the ISPS Code being made against any
Borrower, the Approved Managers or otherwise in connection with a Ship;
or
|
|
(h)
|
any
other matter, event or incident, actual or threatened, the effect of which
will or could lead to the ISM Code or the ISPS Code not being complied
with;
|
|
|
and
the Borrowers shall keep the Security Trustee advised in writing on a
regular basis and in such detail as the Security Trustee shall require of
the Borrowers’, the Approved Managers’ or any other person’s response to
any of those events or matters.
|
|
14.12
|
Restrictions on chartering,
appointment of managers etc. No Borrower shall, in
relation to a Ship:
|
|
(a)
|
(other
than pursuant to a Related Party Charter) let or allow any charterer to
let that Ship on demise charter for any
period;
|
|
(b)
|
(other
than pursuant to a Related Party Charter) enter or allow any charterer to
enter into any time or consecutive voyage charter in respect of that Ship
for a term which exceeds, or which by virtue of any optional extensions
may exceed, 13 months;
|
|
(c)
|
enter
or allow any charterer to enter into any charter in relation to
that Ship under which more than 2 months’ hire (or the equivalent) is
payable in advance;
|
|
(d)
|
(other
than pursuant to a Related Party Charter) charter or allow any charterer
to charter that Ship otherwise than on bona fide arm’s length terms at the
time when that Ship is fixed;
|
|
(e)
|
appoint
or allow any charterer to appoint a manager of that Ship other than the
Approved Managers or agree to any alteration to the terms of the Approved
Managers’ appointment;
|
|
(f)
|
de-activate
or lay up or allow any charterer to de-activate or lay up that Ship;
or
|
|
(g)
|
put
or allow any charterer to put that Ship into the possession of any person
for the purpose of work being done upon it in an amount exceeding or
likely to exceed $500,000 (or the equivalent in any other currency) unless
(i) that person has first given to the Security Trustee and in terms
satisfactory to it a written undertaking not to exercise any lien on that
Ship or its Earnings for the cost of such work or for any other reason or
(ii) the cost of the work to be done on that Ship is covered by insurances
and the underwriters have agreed to make payment direct to the person who
is to carry out the work or (iii) the Agent is otherwise satisfied that
the amounts payable in respect of the cost of the work will be paid on
their relevant due date for
payment.
|
|
14.13
|
Notice of
Mortgage. Each Borrower shall keep the relevant Mortgage
registered against its Ship as a valid first priority mortgage, carry on
board its Ship a certified copy of the relevant Mortgage and place and
maintain in a conspicuous place in the navigation room and the Master’s
cabin of its Ship a framed printed notice stating that its Ship is
mortgaged by that Borrower to the Security
Trustee.
|
|
14.14
|
Sharing of
Earnings. Save as disclosed to the Agent, no
Borrower shall enter into any agreement or arrangement for the sharing of
any Earnings.
|
|
14.15
|
ISPS
Code. The Borrowers shall comply with the ISPS Code and
in particular, without limitation,
shall:
|
|
(a)
|
procure
that each Ship and the company responsible for each Ship’s compliance with
the ISPS Code comply with the ISPS Code;
and
|
|
(b)
|
maintain
for each Ship an
ISSC; and
|
|
(c)
|
notify
the Agent immediately in writing of any actual or threatened withdrawal,
suspension, cancellation or modification of the
ISSC.
|
|
15
|
SECURITY
COVER
|
|
15.1
|
Minimum required security
cover. Clause 15.2 applies
if the Agent notifies the Borrowers
that:
|
|
(a)
|
the
aggregate of the market values (determined as provided in Clause 15.3) of the Ships then subject to a Mortgage;
plus
|
|
(b)
|
the
net realisable value of any additional security previously provided under
this Clause 15;
|
|
|
is
below One hundred and twenty five per cent.(125%) of the Loans (provided
however that Loans for these purposes shall exclude prior to the Delivery
Date in respect of a Ship and the advance of its Delivery Advance, all
Advances of the Loan for such
Ship).
|
|
15.2
|
Provision of additional
security; prepayment. If the Agent serves a notice on
the Borrowers under Clause 15.1, the Borrowers shall, within 1 month after
the date on which the Agent’s notice is served,
either:
|
|
(a)
|
provide,
or ensure that a third party provides, additional security which, in the
reasonable opinion of the Majority Lenders, has a net realisable market
value at least equal to the shortfall and is documented in such terms as
the Agent may, with the authorisation of the Majority Lenders, approve or
require; or
|
|
(b)
|
prepay
such part (at least) of the Loan as will eliminate the
shortfall.
|
|
15.3
|
Valuation of
Ships. The market value of a Ship at any date is that
shown by a valuation prepared:
|
|
(a)
|
as
at a date not more than 10 Business days
previously;
|
|
(b)
|
by
an independent international sale and purchase shipbroker which the Agent
has approved or appointed for the
purpose;
|
|
(c)
|
with
or without physical inspection of the Ship (as the Agent may
require);
|
|
(d)
|
on
the basis of a sale for prompt delivery for cash on normal arm’s length
commercial terms as between a willing seller and a willing buyer, free of
any existing charter or other contract of
employment;
|
|
(e)
|
after
deducting the estimated amount of the usual and reasonable expenses which
would be incurred in connection with the
sale.
|
|
15.4
|
|
15.5
|
|
15.6
|
Provision of
information. The Borrowers shall promptly provide the
Agent and any shipbroker or expert acting under Clause 15.3 or 15.4 with
any information which the Agent or the shipbroker or expert may reasonably
request for the purposes of the valuation; and, if the Borrowers fail to
provide the information by the date specified in the request, the
valuation may be made on any basis and assumptions which the shipbroker or
the Majority Lenders (or the expert appointed by them) consider
prudent.
|
|
15.7
|
Payment of valuation
expenses. Without prejudice to the generality of the
Borrowers’ obligations under Clauses 20.2, 20.3 and 21.3, the Borrowers
shall, on demand, pay the Agent the amount of the fees and expenses of any
shipbroker or expert instructed by the Agent under this Clause and all
legal and other expenses incurred by any Creditor Party in connection with
any matter arising out of this Clause provided however that prior to the
occurrence of an Event of Default the Borrowers shall only be obliged to
reimburse the Agent such fees and expenses in relation to one valuation of
each Ship obtained pursuant to Clause 15 per
each twelve month period. The Borrowers shall also pay to the Agent the
amount of all legal and other expenses incurred by any Creditor Party in
connection with any matter arising out of this Clause 20.
|
|
15.8
|
|
15.9
|
Meaning of additional security.
In Clause 15.1 “security” means a
Security Interest over an asset or assets (whether securing the Borrowers’
liabilities under the Finance Documents or a guarantee in respect of those
liabilities), or a guarantee, letter of credit or other security in
respect of the Borrowers’ liabilities under the Finance
Documents.
|
|
15.10
|
Requirement for additional
documents. The Borrowers shall not be deemed to have complied with
Clause 15.2(a) above until the Agent has
received in connection with the additional security certified copies of
documents of the kinds referred to in paragraphs 3, 4 and 5 of Part A of
Schedule 3 below and such legal opinions in terms acceptable to the Agent
from such lawyers as it may select.
|
|
16
|
PAYMENTS
AND CALCULATIONS
|
|
16.1
|
Currency and method of
payments. All payments to be made by the Lenders or by
the Borrowers under a Finance Document shall be made to the Agent or to
the Security Trustee, in the case of an amount payable to
it:
|
|
(a)
|
by
not later than 11.00 a.m. (New York City time) on the due
date;
|
|
(b)
|
in
same day Dollar funds settled through the New York Clearing House
Interbank Payments System (or in such other Dollar funds and/or settled in
such other manner as the Agent shall specify as being customary at the
time for the settlement of international transactions of the type
contemplated by this Agreement);
|
|
(c)
|
in
the case of an amount payable by a Lender to the Agent or by the Borrowers
to the Agent or any Lender, to the account of the Agent at XX Xxxxxx Xxxxx
Bank, New York (Swift Code: XXXXXX00) Account No. 400759136 for credit to
the Agent (Swift Code: XXXXXX0XXXX Swift Name: Royal Bank of Scotland GLO,
London) reference “GLO re TBS”, or to such other account with such other
bank as the Agent may from time to time notify to the Borrowers and the
other Creditor Parties; and
|
|
(d)
|
in
the case of an amount payable to the Security Trustee, to such account as
it may from time to time notify to the Borrowers and the other Creditor
Parties.
|
|
16.2
|
Payment on non-Business
Day. If any payment by the Borrowers under a Finance
Document would otherwise fall due on a day which is not a Business
Day:
|
|
(a)
|
the
due date shall be extended to the next succeeding Business Day;
or
|
|
(b)
|
if
the next succeeding Business Day falls in the next calendar month, the due
date shall be brought forward to the immediately preceding Business
Day;
|
and
interest shall be payable during any extension under paragraph (a) at the rate
payable on the original due date.
|
16.3
|
Basis for calculation of
periodic payments. All interest and commitment fee and
any other payments under any Finance Document which are of an annual or
periodic nature shall accrue from day to day and shall be calculated on
the basis of the actual number of days elapsed and a 360 day
year.
|
|
(a)
|
any
amount received by the Agent under a Finance Document for distribution or
remittance to a Lender, the Swap Bank or the Security Trustee shall be
made available by the Agent to that Lender, the Swap Bank or, as the case
may be, the Security Trustee by payment, with funds having the same value
as the funds received, to such account as the Lender, the Swap Bank or the
Security Trustee may have notified to the Agent not less than 5 Business
Days previously; and
|
|
(b)
|
amounts
to be applied in satisfying amounts of a particular category which are due
to the Lenders generally shall be distributed by the Agent to each Lender
pro rata to the amount in that category which is due to
it.
|
|
16.5
|
Permitted deductions by
Agent. Notwithstanding any other provision of this Agreement or any
other Finance Document, the Agent may, before making an amount available
to a Lender, deduct and withhold from that amount any sum which is then
due and payable to the Agent from that Lender under any Finance Document
or any sum which the Agent is then entitled under any Finance Document to
require or that Lender to pay on
demand.
|
|
16.6
|
Agent only obliged to pay when
monies received. Notwithstanding any other provision of
this Agreement or any other Finance Document, the Agent shall not be
obliged to make available to the Borrowers or any Lender any sum which the
Agent is expecting to receive for remittance or distribution to the
Borrowers or that Lender until the Agent has satisfied itself that it has
received that sum.
|
|
16.7
|
Refund to Agent of monies not
received. If and to the extent that the Agent makes
available a sum to the Borrowers or a Lender, without first having
received that sum, the Borrowers or the Lender concerned (as the case may
be) shall, on demand:
|
|
(a)
|
refund
the sum in full to the Agent; and
|
|
(b)
|
pay
to the Agent the amount (as certified by the Agent) which will indemnify
the Agent against any funding or other loss, liability or expense incurred
by the Agent as a result of making the sum available before receiving
it.
|
|
16.8
|
Agent may assume
receipt. Clause 16.7 shall
not affect any claim which the Agent has under the law of restitution, and
applies irrespective of whether the Agent had any form of notice that it
had not received the sum which it made
available.
|
|
16.9
|
Creditor Party
accounts. Each Creditor Party shall maintain accounts
showing the amounts owing to it by the Borrowers and each Security Party
under the Finance Documents and all payments in respect of those amounts
made by the Borrowers and any Security
Party.
|
|
16.10
|
Agent’s memorandum
account. The Agent shall maintain a memorandum account
showing all sums owing to the Agent, the Security Trustee, and each Lender
from the Borrowers and each Security Party under the Finance Documents and
all payments in respect of those amounts made by the Borrowers and any
Security Party.
|
|
16.11
|
|
17
|
APPLICATION
OF RECEIPTS
|
|
17.1
|
Normal order of
application. Except as any Finance Document may
otherwise provide, any sums which are received or recovered by any
Creditor Party under or by virtue of any Finance Document shall be
applied:-
|
|
(a)
|
FIRST:
in or towards satisfaction of any amounts then due and payable under the
Finance Documents (or any of them), other than the Master Agreement, in
such order of application and/or such proportions as the Agent, acting
with the authorisation of the Majority Lenders, may specify by notice to
the Borrowers, the Security Parties and the other Creditor
Parties;
|
|
(b)
|
SECONDLY:
in or towards satisfaction of amounts then due and payable under the
Master Agreement, in such order of application as the Agent, acting with
the authorisation of the Majority Lenders, may specify by notice to the
Borrowers, the Security Parties and the other Creditor
Parties;
|
|
(c)
|
THIRDLY:
in retention of an amount equal to any amount not then due and payable
under any Finance Document but which the Agent, by notice to the
Borrowers, the Security Parties and the other Creditor Parties, states in
its opinion will or may become due and payable in the future and, upon
those amounts becoming due and payable, in or towards satisfaction of them
in accordance with the foregoing provisions of this Clause;
and
|
|
(d)
|
FOURTHLY:
any surplus shall be paid to the Borrowers or to any other person
appearing to be entitled to it.
|
|
17.2
|
Variation of order of
application. The Agent may, with the authorisation of
the Majority Lenders, by notice to the Borrowers, the Security Parties and
the other Creditor Parties provide for a different manner of application
from that set out in Clause 17.1 either as
regards a specified sum or sums or as regards sums in a specified category
or categories.
|
|
17.3
|
Notice of variation of order of
application. The Agent may give notices under Xxxxxx 17.2 from time to time; and such a notice may be
stated to apply not only to sums which may be received or recovered in the
future, but also to any sum which has been received or recovered on or
after the third Business Day before the date on which the notice is
served.
|
|
17.4
|
|
18
|
EARNINGS
ACCOUNT AND XXXXXXX EARNINGS
ACCOUNT
|
|
18.1
|
Payment of
Earnings. The Borrowers agree that at any time following
the date of this Agreement (and whether before or after the occurrence of
an Event of Default and whether or not the same is continuing), the Agent
shall be entitled (but not bound) to give the Borrowers a notice in
writing directing the Borrowers (or any of them) to procure and ensure
that the Earnings of the Ships (or the relevant Ship referred to in such
direction) are thereafter paid to the Standby Earnings
Account. Where such a notice is given to the Borrowers (or
relevant Borrower) before the occurrence of an Event of Default, the
Borrowers (or relevant Borrower, as the case may be) shall be given a
period of 5 Business Days in which to re-direct the payments but where an
Event of Default has occurred the re-direction shall take effect
immediately upon receipt of the Agent’s notice to that effect. For the
avoidance of doubt where the Agent gives such a direction all Earnings of
the relevant Ship or Ships which are subsequently paid to TBS Pacific
Liner shall (save as provided above) be paid directly to the Standby
Earnings Account. In respect of any such Earnings which have
been paid to and are standing to the credit of the Earnings Account the
Borrowers shall procure that following the occurrence of an Event of
Default and receipt of a direction from the Agent in accordance with this
clause 18.1, such amounts shall be transferred to the Standby Earnings
Account as soon as practicable after such
direction.
|
|
18.2
|
Interest accrued on the
Earnings Account and the Standby Earnings Account. Any
credit balance on the Earnings Account and the Standby Earnings Account
shall bear interest at the rate from time to time offered by the Agent to
its customers for Dollar deposits of similar amounts and for periods
similar to those for which such balances appear to the Agent likely to
remain on the Earnings Account and the Standby Earnings
Account.
|
|
18.3
|
Monies on the Earnings Account
and the Standby Earnings Account. Following the
occurrence of an Event of Default which is continuing and a direction from
the Agent under Clause 18.1 above:-
|
|
(i)
|
any
Earnings of the Ships standing to the credit of the Earnings Account shall
be transferred to the Standby Earnings Account;
and
|
|
(ii)
|
any
amounts standing to the credit of the Standby Earnings Account shall only
be released with the approval of the Majority
Lenders.
|
|
18.4
|
Location of
accounts. The Borrowers shall, and shall procure that
TBS Pacific Liner shall, promptly :
|
|
(a)
|
comply
with any requirement of the Agent as to the location or re-location of the
Earnings Account and the Standby Earnings
Account;
|
|
(b)
|
execute
any documents which the Agent specifies to create or maintain in favour of
the Security Trustee a Security Interest over (and/or rights of set-off,
consolidation or other rights in relation to) the Standby Earnings
Account.
|
|
18.5
|
Debits for expenses
etc. Following the occurrence of an Event of Default
which is continuing and a direction from the Agent under Clause 18.1
above, the Agent shall be entitled (but not obliged) from time to time to
debit the Standby Earnings Account without prior notice in order to
discharge any amount due and payable under Clause 20 or 21 to a
Creditor Party or payment of which any Creditor Party has become entitled
to demand under Clause 20 or 21.
|
|
19
|
EVENTS
OF DEFAULT
|
|
19.1
|
Events of
Default. An Event of Default occurs
if:
|
|
(a)
|
any
Borrower or any Security Party fails to pay when due or (if so payable) on
demand any sum payable under a Finance Document (and so that for this
purpose (i) sums payable on demand shall be treated as having been paid
when due if paid within 3 Business Days of receipt of the demand and (ii)
if the failure is caused by a disruption to the payments system referred
to in Clause 16.1(b) which disruption is
beyond the control of the Borrowers, such failure shall not constitute an
Event of Default if payment is made within 3 Business Days of its due
date); or
|
|
(c)
|
any
breach occurs of Clause 11.18(i);
or
|
|
(d)
|
any
breach by any Borrower or any Security Party occurs of any provision of a
Finance Document (other than a breach covered by paragraphs (a) or (b))
and if, in the opinion of the Majority Lenders, such default is capable of
remedy (and for these purposes any breach by any Borrower of its
obligations under Clause 13 in relation to
insurances will be a default not capable of remedy), such default
continues unremedied 10 Business Days after written notice from the Agent
requesting action to remedy the same;
or
|
|
(e)
|
any
representation, warranty or statement made by, or by an officer of, any
Borrower or a Security Party in a Finance Document or in a Drawdown Notice
Request or any other notice or document relating to a Finance Document is
untrue or misleading in any material respect when it is made;
or
|
|
(f)
|
any
of the following occurs in relation to any Financial Indebtedness of a
Relevant Person:
|
|
(i)
|
any
Financial Indebtedness of a Relevant Person is not paid when due or, if so
payable, on demand or in either such cases, within any applicable grace
period; or
|
|
(ii)
|
any
Financial Indebtedness of a Relevant Person becomes due and payable or
capable of being declared due and payable prior to its stated maturity
date as a consequence of any event of default;
or
|
|
(iii)
|
a
lease, hire purchase agreement or charter creating any Financial
Indebtedness of a Relevant Person is terminated by the lessor or owner or
becomes capable of being terminated as a consequence of any termination
event; or
|
|
(iv)
|
any
overdraft, loan, note issuance, acceptance credit, letter of credit,
guarantee, foreign exchange or other facility, or any swap or other
derivative contract or transaction, relating to any Financial Indebtedness
of a Relevant Person ceases to be available or becomes capable of being
terminated as a result of any event of default, or cash cover is required,
or becomes capable of being required, in respect of such a facility as a
result of any event of default; or
|
|
(v)
|
any
Security Interest securing any Financial Indebtedness of a Relevant Person
becomes enforceable;
|
provided
that no Event of Default will occur under this Clause 19.1(f) in relation to the New Corporate Guarantor if
the amount of Financial Indebtedness falling within paragraph (i) to (v) above
is less than $2,500,000 (or its equivalent in any other currency or
currencies)
|
(g)
|
any
of the following occurs in relation to a Relevant
Person:
|
|
(i)
|
a
Relevant Person becomes, in the opinion of the Majority Xxxxxxx, unable to
pay its debts as they fall due; or
|
|
(ii)
|
all
or substantially all of the assets of a Relevant Person are subject to any
form of execution, attachment, arrest, sequestration or distress in
respect of a sum of, or sums aggregating, $500,000 or more or the
equivalent in another currency and is not discharged within one month of
the same being levied or sued out;
or
|
|
(iii)
|
any
administrative or other receiver is appointed over any substantial part of
assets of a Relevant Person; or
|
|
(iv)
|
an
administrator is appointed (whether by the court or otherwise) in respect
of a Relevant Person; or
|
|
(v)
|
any
formal declaration of bankruptcy or any formal statement to the effect
that a Relevant Person is insolvent or likely to become insolvent is made
by a Relevant Person or by the directors of a Relevant Person or, in any
proceedings, by a lawyer acting for a Relevant Person;
or
|
|
(vi)
|
a
provisional liquidator is appointed in respect of a Relevant Person, a
winding up order is made in relation to a Relevant Person or a winding up
resolution is passed by a Relevant Person;
or
|
|
(vii)
|
a
resolution is passed, an administration notice is given or filed, an
application or petition to a court is made or presented or any other step
is taken by (aa) a Relevant Person, (bb) the members or directors of a
Relevant Person, (cc) a holder of Security Interests which together relate
to all or substantially all of the assets of a Relevant Person, or (dd) a
government minister or public or regulatory authority of a Pertinent
Jurisdiction having jurisdiction over that Relevant Person for or with a
view to the winding up of that or another Relevant Person or the
appointment of a provisional liquidator or administrator in respect of
that or another Relevant Person, or that or another Relevant Person
ceasing or suspending business operations or payments to creditors, save
that this paragraph does not apply to a fully solvent winding up of a
Relevant Person other than a Borrower which is, or is to be, effected for
the purposes of an amalgamation or reconstruction previously approved by
the Majority Lenders and effected not later than 3 months after the
commencement of the winding up; or
|
|
(viii)
|
an
administration notice is given or filed, an application or petition to a
court is made or presented or any other step is taken by a creditor of a
Relevant Person (other than a holder of Security Interests which together
relate to all or substantially all of the assets of a Relevant Person) for
the winding up of a Relevant Person or the appointment of a provisional
liquidator or administrator in respect of a Relevant Person in any
Pertinent Jurisdiction having jurisdiction over that Relevant Person,
unless the proposed winding up, appointment of a provisional liquidator or
administration is being contested in good faith, on substantial grounds
and not with a view to some other insolvency law procedure being
implemented instead and either (aa) the application or petition is
dismissed or withdrawn within 30 days of being made or presented, or (bb)
within 30 days of the administration notice being given or filed, or the
other relevant steps being taken, other action is taken which will ensure
that there will be no administration and (in both cases (aa) or (bb)) the
Relevant Person will continue to carry on business in the ordinary way and
without being the subject of any actual, interim or pending insolvency law
procedure; or
|
|
(ix)
|
a
Relevant Person or its directors take any steps (whether by making or
presenting an application or petition to a court, or submitting or
presenting a document setting out a proposal or proposed terms, or
otherwise) with a view to obtaining, in relation to that or another
Relevant Person, any form of moratorium, suspension or deferral of
payments, reorganisation of debt (or certain debt) by reason of financial
difficulties or arrangement with all or a substantial proportion (by
number or value) of creditors or of any class of them or any such
moratorium, suspension or deferral of payments, reorganisation or
arrangement is effected by court order, by the filing of documents with a
court, by means of a contract or in any other way at all;
or
|
|
(x)
|
any
meeting of the members or directors, or of any committee of the board or
senior management, of a Relevant Person is held or summoned for the
purpose of considering a resolution or proposal to authorise or take any
action of a type described in paragraphs (iv) to (ix) or a step
preparatory to such action, or (with or without such a meeting) the
members, directors or such a committee resolve or agree that such an
action or step should be taken or should be taken if certain conditions
materialise or fail to materialise;
or
|
|
(xi)
|
in
a Pertinent Jurisdiction other than England or Wales or to the
jurisdiction of whose courts any part of that Relevant Person’s assets are
subject, any event occurs, any proceedings are opened or commenced or any
step is taken which, in the opinion of the Majority Lenders is similar to
any of the foregoing; or
|
|
(h)
|
any
Borrower ceases or suspends carrying on its business or a part of its
business which, in the opinion of the Majority Lenders, is material in the
context of this Agreement; or
|
|
(i)
|
it
becomes unlawful in any Pertinent Jurisdiction or
impossible:
|
|
(i)
|
for
any Borrower or any Security Party to discharge any liability under a
Finance Document or to comply with any other obligation which the Majority
Lenders consider material under a Finance Document unless provided that
none of the interests of any of the Creditor Parties is prejudiced in any
way during the relevant period, the discharge of that liability or
compliance with that obligation or exercise or enforcement of those rights
ceases to be unlawful within 30 days;
or
|
|
(ii)
|
for
the Agent, the Security Trustee, or the Lenders to exercise or enforce any
right under, or to enforce any Security Interest created by, a Finance
Document; or
|
|
(j)
|
any
official consent necessary to enable any Borrower to own, operate or
charter its Ship or to enable any Borrower or any Security Party to comply
with any provision which the Majority Lenders consider material of a
Finance Document or any of the Shipbuilding Contracts is not granted,
expires without being renewed, is revoked or becomes liable to revocation
or any condition of such a consent is not fulfilled;
or
|
|
(k)
|
|
(i)
|
any
Bareboat Charter is terminated or cancelled for whatever reason and, if
the Ship the subject of such Bareboat Charter is to remain parallel
registered under the Philippines flag, such Bareboat Charter is not
replaced with a similar bareboat charter on terms acceptable to the Agent
within a period of 15 days; or
|
|
(ii)
|
any
of the circumstances described in Clause 19.1(g) or (h) occurs (mutatis mutandis) in
relation to the Bareboat Charterer or the Bareboat Charterer breaches any
provision of the Multiparty Deeds which the Agent considers material and
the Borrowers fail within a period of 15 days of them becoming aware of
the occurrence of such circumstances or breach or of the receipt of a
written notification from the Agent requesting the Borrowers to remedy
such circumstances or breach either to remedy such circumstances or breach
or to substitute the Bareboat Charterer with another bareboat charterer
acceptable to the Agent and which accedes to the terms of the Multiparty
Deeds;
|
|
(l)
|
any
Time Charter or First Sub-Time Charter or Second Sub-Time Charter or TBS
Worldwide Time Charter is terminated or cancelled for whatever reason or
any of the circumstances described in Clause 19.1(g) or (h) occurs
(mutatis mutandis) in relation to the Time Charterer or TBS Worldwide or
the Time Charterer or TBS Worldwide breaches any provision of the
Multiparty Deeds which the Agent considers material and either such breach
is not remedied or the Ship the subject of such Time Charter or First
Sub-Time Charter or Second Sub-Time Charter or TBS Worldwide Time Charter
is not employed on alternative terms acceptable to the Agent within a
period of 15 days of the Borrowers becoming aware of the occurrence of
such breach or the receipt of a written notification from the Agent
requesting the Borrowers to remedy such breach;
or
|
|
(m)
|
any
of the Ships ceases to be employed by the Approved Manager on terms
acceptable to the Agent or any of the circumstances described in Clause 19.1(g) or (h) occurs (mutatis mutandis) in
relation to the Approved Managers or the Approved Managers breach any
provisions of the letters of undertaking given to the Security Trustee
pursuant to Schedule 3 Part C, 3(a) which the Agent considers material and
the Borrowers fails within a period of 15 days of them becoming aware of
the occurrence of such circumstances or breach or of the receipt of a
written notification from the Agent requesting the Borrowers to remedy
such circumstances or breach either to remedy such circumstances or breach
or to substitute the Approved Managers with other Approved Managers which
execute and deliver to the Security Trustee letters of undertaking similar
to those referred to in Schedule 3 Part C, 3(a);
or
|
|
(n)
|
any
of the circumstances described in Clause 19.1(g) or (h) occurs (mutatis
mutandis) in relation to TBS Pacific Liner or TBS Pacific Liner breaches
any provision of the Account Security Deed which the Agent considers
material and the Borrowers fail within a period of 15 days’ of them
becoming aware of the occurrence of such circumstances or breach or of the
receipt of a written notification from the Agent requesting the Borrowers
to remedy such circumstances or breach either to remedy the circumstances
or breach or to substitute the Earnings Account and the Standby Earnings
Account with a new Earnings Account and a new Standby Earnings Account in
the name of an alternative party acceptable to the Agent and which
executes and delivers in favour of the Security Trustee a new Account
Security Deed.
|
|
(o)
|
an
Event of Default (as defined in Section 14 of the Master Agreement)
occurs;
|
|
(p)
|
any
provision which the Majority Lenders consider in their reasonable opinion
material of a Finance Document proves to have been or becomes invalid or
unenforceable, or a Security Interest created by a Finance Document proves
to have been or becomes invalid or unenforceable or such a Security
Interest proves to have ranked after, or loses its priority to, another
Security Interest or any other third party claim or interest;
or
|
|
(q)
|
the
security constituted by a Finance Document is in any way imperilled or in
jeopardy; or
|
|
(r)
|
an
Event of Default (as defined in the Guarantee Facility Agreement)
occurs;
|
|
(s)
|
any
other event occurs or any other circumstances arise or develop including,
without limitation:
|
|
(i)
|
a
change in the financial position, state of affairs or prospects of any
Borrower; or
|
|
(ii)
|
any
accident or other event involving any Ship or another vessel owned,
chartered or operated by a Relevant
Person;
|
in the
light of which the Majority Lenders consider that there is a significant risk
that any Borrower is, or will later become, unable to discharge its liabilities
under the Finance Documents as they fall due.
|
19.2
|
Actions following an Event of
Default. On, or at any time after, the occurrence of an
Event of Default and while the Event of Default is
continuing:
|
|
(a)
|
the
Agent may, and if so instructed by the Majority Lenders, the Agent
shall:
|
|
(i)
|
serve
on the Borrowers a notice stating that the Commitments and all other
obligations of each Lender to the Borrowers under this Agreement are
terminated; and/or
|
|
(ii)
|
serve
on the Borrowers a notice stating that the Loans, all accrued interest and
all other amounts accrued or owing under this Agreement are immediately
due and payable or are due and payable on demand;
and/or
|
|
(iii)
|
take
any other action which, as a result of the Event of Default or any notice
served under paragraph (i) or (ii), the Agent and/or the Lenders are
entitled to take under any Finance Document or any applicable law;
and/or
|
|
(b)
|
the
Security Trustee may, and if so instructed by the Agent, acting with the
authorisation of the Majority Lenders, the Security Trustee shall take any
action which, as a result of the Event of Default or any notice served
under paragraph (a) (i) or (ii), the Security Trustee, the Agent and/or
the Lenders are entitled to take under any Finance Document or any
applicable law.
|
|
19.3
|
Termination of
Commitments. On the service of a notice under Clause 19.2(a)(i), the Commitments and all other
obligations of each Lender to the Borrower under this Agreement shall
terminate.
|
|
19.4
|
Acceleration of
Liabilities. On the service of a notice under Clause 19.2(a)(ii), all amounts accrued or owing from
the Borrowers or any Security Party under this Agreement and every other
Finance Document shall become immediately due and payable or, as the case
may be, payable on demand.
|
|
19.5
|
Multiple notices; action
without notice. The Agent may serve notices under
Clauses 19.2(a)(i), or (ii) simultaneously or on different dates and it
and/or the Security Trustee may take any action referred to in Clause 19.2 if no such notice is served or
simultaneously with or at any time after the service of both or either of
such notices.
|
|
19.6
|
Notification of Creditor
Parties and Security Parties. The Agent shall send to
each Lender, the Security Trustee and each Security Party a copy or the
text of any notice which the Agent serves on the Borrowers under Clause 19.2; but the notice shall become effective when
it is served on the Borrowers, and no failure or delay by the Agent to
send a copy or the text of the notice to any other person shall invalidate
the notice or provide the Borrowers or any Security Party with any form of
claim or defence.
|
|
19.7
|
Xxxxxx’s and Swap Bank’s rights
unimpaired. Nothing in this Clause shall be taken to
impair or restrict the exercise of any right given to individual Lenders
or the Swap Bank under a Finance Document or the general law; and, in
particular, this Clause is without prejudice to Clause 3.1.
|
|
19.8
|
Exclusion of Creditor Party
liability. No Creditor Party, and no receiver or manager
appointed by the Security Trustee, shall have any liability to the
Borrowers or a Security Party:
|
|
(a)
|
for
any loss caused by an exercise of rights under, or enforcement of a
Security Interest created by, a Finance Document or by any failure or
delay to exercise such a right or to enforce such a Security Interest;
or
|
|
(b)
|
as
mortgagee in possession or otherwise, for any income or principal amount
which might have been produced by or realised from any asset comprised in
such a Security Interest or for any reduction (however caused) in the
value of such an asset;
|
except
that this does not exempt a Creditor Party or a receiver or manager from
liability for losses shown to have been directly and mainly caused by the
dishonesty or the wilful misconduct of such Creditor Party’s own officers and
employees or (as the case may be) such receiver’s or manager’s own partners or
employees.
|
19.9
|
Relevant
Persons. In this Clause 19
a “Relevant
Person” means any Borrower and any Security
Party.
|
|
19.10
|
Interpretation. In
Clause 19.1(f) references to an event of
default or a termination event include any event, howsoever described,
which is similar to an event of default in a facility agreement or a
termination event in a finance lease; and in Clause
19.1(g) “petition” includes an
application.
|
|
20
|
FEES
AND EXPENSES
|
|
20.1
|
Arrangement, commitment and
agency fees. The Borrowers shall pay to the
Agent:
|
|
(a)
|
on
the date of this Agreement, an arrangement fee in the amount specified in
the Fee Letter or Fee Letters (as the case may
be);
|
|
(b)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan A Delivery
Advance and (ii) 30 September 2009 (or such later date as the Agent, in
its sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
A;
|
|
(c)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan B Delivery
Advance and (ii) 31 March 2010 (or such later date as the Agent, in its
sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
B;
|
|
(d)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan C Delivery
Advance and (ii) 31 August 2010 (or such later date as the Agent, in its
sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
C;
|
|
(e)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan D Delivery
Advance and (ii) 30 April 2011 (or such later date as the Agent, in its
sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
D;
|
|
(f)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan E Delivery
Advance and (ii) 31 January 2011 (or such later date as the Agent, in its
sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
E;
|
|
(g)
|
quarterly
in arrears during the period from (and including) 27 March 2009 to the
earlier of (i) the Drawdown Date in relation to the Loan F Delivery
Advance and (ii) 31 August 2011 (or such later date as the Agent, in its
sole and absolute discretion shall agree) and on the last day of that
period a commitment fee at the rate of One point five per cent. (1.5%) per
annum on the undrawn balance of Loan
F;
|
|
(h)
|
on
the date of this Agreement and on each anniversary thereof during the
Security Period, an annual agency fee of an amount specified in the
relevant Fee Letter, such agency fee to be payable to the Agent in advance
for its own account.
|
|
20.2
|
Costs of negotiation,
preparation etc. The Borrowers shall pay to the Agent on
its demand the amount of all expenses reasonably incurred by the Agent or
the Security Trustee in connection with the negotiation, preparation,
execution or registration of any Finance Document or any related document
or with any transaction contemplated by a Finance Document or a related
document.
|
|
20.3
|
Costs of variations,
amendments, enforcement etc. The Borrowers shall pay to
the Agent, on the Agent’s demand, for the account of the Creditor Party
concerned the amount of all expenses incurred by a Creditor Party (in the
case of paragraphs (a), (b) and (c), such expenses to be reasonably
incurred) in connection with:
|
|
(a)
|
any
amendment or supplement to a Finance Document, or any proposal for such an
amendment to be made;
|
|
(b)
|
any
consent or waiver by the Lenders, the Majority Lenders or the Creditor
Party concerned under or in connection with a Finance Document, or any
request for such a consent or
waiver;
|
|
(c)
|
the
valuation of any security provided or offered under Clause 15 or any other matter relating to such
security; or
|
|
(d)
|
any
step taken by the Creditor Party concerned with a view to the protection,
exercise or enforcement of any right or Security Interest created by a
Finance Document or for any similar
purpose.
|
There
shall be recoverable under paragraph (d) the full amount of all legal expenses,
whether or not such as would be allowed under rules of court or any taxation or
other procedure carried out under such rules.
|
20.4
|
Extraordinary management
time. The Borrowers shall pay to the Agent on its demand
compensation in respect of the reasonable and documented amount of time
which the management of either Servicing Bank has spent in connection with
a matter covered by Clause 20.3 and which
exceeds the amount of time which would ordinarily be spent in the
performance of the relevant Servicing Bank’s routine
functions. Any such compensation shall be based on such
reasonable daily or hourly rates as the Agent may notify to the Borrowers
and is in addition to any fee paid or payable to the relevant Servicing
Bank. Where one bank is both Agent and Security Trustee there
shall be no double charging of such
compensation.
|
|
20.5
|
Documentary
taxes. The Borrowers shall promptly pay any tax payable
on or by reference to any Finance Document, and shall, on the Agent’s
demand, fully indemnify each Creditor Party against any claims, expenses,
liabilities and losses resulting from any failure or delay by the
Borrowers to pay such a tax.
|
|
20.6
|
Certification of
amounts. A notice which is signed by 2 officers of a
Creditor Party, which states that a specified amount, or aggregate amount,
is due to that Creditor Party under this Clause 20 and which indicates (without necessarily
specifying a detailed breakdown) the matters in respect of which the
amount, or aggregate amount, is due shall (save in the case of manifest
error) be prima facie evidence that the amount, or aggregate amount, is
due.
|
|
21
|
INDEMNITIES
|
|
21.1
|
Indemnities regarding borrowing
and repayment of Loan. The Borrowers shall fully
indemnify the Agent and each Lender on the Agent’s demand and the Security
Trustee on its demand in respect of all claims, expenses, liabilities and
losses which are made or brought against or incurred by that Creditor
Party, or which that Creditor Party reasonably and with due diligence
estimates that it will incur, as a result of or in connection
with:
|
|
(a)
|
an
Advance not being borrowed on the date specified in the Drawdown Notice
for any reason other than a default by the Lender claiming the
indemnity;
|
|
(b)
|
the
receipt or recovery of all or any part of the Loans or an overdue sum
otherwise than on the last day of an Interest Period or other relevant
period;
|
|
(c)
|
any
failure (for whatever reason) by the Borrowers to make payment of any
amount due under a Finance Document on the due date or, if so payable, on
demand (after giving credit for any default interest paid by the Borrowers
on the amount concerned under Clause
7);
|
|
(d)
|
the
occurrence and/or continuance of an Event of Default or a Potential Event
of Default and/or the acceleration of repayment of the Loans under Clause
19;
|
and in
respect of any tax (other than tax on its overall net income) for which a
Creditor Party is liable in connection with any amount paid or payable to that
Creditor Party (whether for its own account or otherwise) under any Finance
Document.
|
21.2
|
Breakage
costs. Without limiting its generality, Clause 21.1 covers any claim, expense, liability or
loss, including a loss of a prospective profit, incurred by a
Lender:
|
|
(a)
|
in
liquidating or employing deposits from third parties acquired or arranged
to fund or maintain all or any part of its Contribution and/or any overdue
amount (or an aggregate amount which includes its Contribution or any
overdue amount); and
|
|
(b)
|
in
terminating, or otherwise in connection with, any interest and/or currency
swap or any other transaction entered into (whether with another legal
entity or with another office or department of the Lender concerned) to
hedge any exposure arising under this Agreement or that part which the
Lender concerned determines is fairly attributable to this Agreement of
the amount of the liabilities, expenses or losses (including losses of
prospective profits) incurred by it in terminating, or otherwise in
connection with, a number of transactions of which this Agreement is
one.
|
In the
circumstances referred to in Clause 21.1(b) such
costs shall include an amount equal to the relevant Margin which would, but for
receipt or recovery of the relevant part of the Loans, have accrued on the
relevant part of the Loans, from the date of such receipt or recovery to the end
of the then current Interest Period relating thereto.
|
21.3
|
Miscellaneous
indemnities. The Borrowers shall fully indemnify each
Creditor Party severally on their respective demands in respect of all
claims, expenses, liabilities and losses which may be made or brought
against or incurred by a Creditor Party, in any country, as a result of or
in connection with any action taken, or omitted or neglected to be taken,
under or in connection with any Finance Document by the Agent, the
Security Trustee or any other Creditor Party or by any receiver appointed
under a Finance Document other than claims, expenses, liabilities and
losses which are shown to have been directly and mainly caused by the
dishonesty or wilful misconduct or the reckless action with knowledge of
the probable consequences of the officers or employees of the Creditor
Party concerned.
|
Without
prejudice to its generality, this Clause 21.3
covers any claims, expenses, liabilities and losses which arise, or are
asserted, under or in connection with any law relating to safety at sea, the ISM
Code, the ISPS Code or any Environmental Law.
|
21.4
|
Currency
indemnity. If any sum due from the Borrowers or any
Security Party to a Creditor Party under a Finance Document or under any
order or judgment relating to a Finance Document has to be converted from
the currency in which the Finance Document provided for the sum to be paid
(the “Contractual
Currency”) into another currency (the “Payment Currency”) for
the purpose of:
|
|
(a)
|
making
or lodging any claim or proof against the Borrowers or any Security Party,
whether in its liquidation, any arrangement involving it or otherwise;
or
|
|
(b)
|
obtaining
an order or judgment from any court or other tribunal;
or
|
|
(c)
|
enforcing
any such order or judgment;
|
the
Borrowers shall indemnify the Creditor Party concerned against the loss arising
when the amount of the payment actually received by that Creditor Party is
converted at the available rate of exchange into the Contractual
Currency.
In this
Clause 21.4 the “available rate of exchange”
means the rate at which the Creditor Party concerned is able at the opening of
business (London time) on the Business Day after it receives the sum concerned
to purchase the Contractual Currency with the Payment Currency.
This
Clause 21.4 creates a separate liability of the
Borrowers which is distinct from their other liabilities under the Finance
Documents and which shall not be merged in any judgment or order relating to
those other liabilities.
|
21.5
|
Certification of
amounts. A notice which is signed by 2 officers of a
Creditor Party, which states that a specified amount, or aggregate amount,
is due to that Creditor Party under this Clause 21 and which indicates (without necessarily
specifying a detailed breakdown) the matters in respect of which the
amount, or aggregate amount, is due shall (save in the case of manifest
error) be prima facie evidence that the amount, or aggregate amount, is
due.
|
|
21.6
|
Sums deemed due to a
Lender. For the purposes of this Clause 21, a sum payable by the Borrowers to the Agent
or the Security Trustee for distribution to a Lender shall be treated as a
sum due to that Lender.
|
|
21.7
|
Environmental
Indemnity. The Borrowers shall indemnify the Creditor
Parties on demand against all costs, expenses, liabilities and losses
sustained or incurred as a result of or in connection with any
Environmental Claims being made against the Creditor Parties or otherwise
howsoever arising out of any Environmental
Incident.
|
|
22
|
NO
SET-OFF OR TAX DEDUCTION
|
|
22.1
|
No
deductions. All amounts due from a Borrower under a
Finance Document shall be paid:
|
|
(a)
|
without
any form of set-off, cross-claim or condition;
and
|
|
(b)
|
free
and clear of any tax deduction except a tax deduction which that Borrower
is required by law to make.
|
|
22.2
|
Grossing-up for
taxes. If a Borrower is required by law to make a tax
deduction from any payment:
|
|
(a)
|
that
Xxxxxxxx shall notify the Agent as soon as it becomes aware of the
requirement;
|
|
(b)
|
that
Borrower shall pay the tax deducted to the appropriate taxation authority
promptly, and in any event before any fine or penalty
arises;
|
|
(c)
|
the
amount due in respect of the payment shall be increased by the amount
necessary to ensure that the relevant Creditor Parties receive and retain
(free from any liability relating to the tax deduction) a net amount
which, after the tax deduction, is equal to the full amount which they
would otherwise have received.
|
No
Borrower shall be obliged to pay any additional amount pursuant to paragraph (c)
above in respect of any deduction which would not have been required if the
relevant Creditor Party had completed a declaration claim, exemption or other
form which it has been requested by the Borrowers or an applicable taxation
authority to complete and which it is able to complete.
|
22.3
|
Evidence of payment of
taxes. Within 1 month after making any tax deduction,
the Borrower concerned shall deliver to the Agent documentary evidence
satisfactory to the Agent that the tax had been paid to the appropriate
taxation authority.
|
|
22.4
|
Tax
credits. A Creditor Party which receives for its own
account a repayment or obtains relief or credit in respect of tax paid or
otherwise payable by it in respect of or calculated by reference to the
increased payment made by a Borrower under Clause 22.2 shall pay to the
relevant Borrower a sum equal to the proportion of the repayment, relief
or credit which that Creditor Party allocates to the amount due from that
Borrower in respect of which that Borrower made the increased
payment:
|
|
(a)
|
the
Creditor Party shall not be obliged to allocate to this transaction any
part of a tax repayment, relief or credit which is referable to a class or
number of transactions;
|
|
(b)
|
nothing
in this Clause 22.4 shall oblige a Creditor
Party to arrange its tax affairs in any particular manner, to claim any
type of relief, credit, allowance or deduction instead of, or in priority
to, another or to make any such claim within any particular
time;
|
|
(c)
|
nothing
in this Clause 22.4 shall oblige a Creditor
Party to make a payment which would leave it in a worse position than it
would have been in if the relevant Borrower had not been required to make
a tax deduction from a payment; and
|
|
(d)
|
any
allocation or determination made by a Creditor Party under or in
connection with this Clause 22.4 shall (save
in the case of manifest error) be conclusive and binding on the Borrowers
and the other Creditor Parties.
|
|
22.5
|
Exclusion of tax on overall net
income. In this Clause 22
“tax deduction”
means any deduction or withholding for or on account of any present or
future tax except tax on a Creditor Party’s overall net
income.
|
|
22.6
|
Application of Master
Agreement. For the avoidance of doubt, Xxxxxx 22 does not apply in respect of sums due from
the Borrowers to the Swap Bank under or in connection with the Master
Agreement as to which sums the provisions of section 2(d) (Deduction or
Withholding for Tax) of the Master Agreement shall
apply.
|
|
23
|
ILLEGALITY,
ETC
|
|
23.1
|
Illegality. This
Clause 23 applies if a Lender (the “Notifying Lender”)
notifies the Agent that it has become, or will with effect from a
specified date, become:
|
|
(a)
|
unlawful
or prohibited as a result of the introduction of a new law, an amendment
to an existing law or a change in the manner in which an existing law is
or will be interpreted or applied;
or
|
|
(b)
|
contrary
to, or inconsistent with, any
regulation,
|
for the
Notifying Lender to maintain or give effect to any of its obligations under this
Agreement in the manner contemplated by this Agreement.
|
23.2
|
Notification of
illegality. The Agent shall promptly notify the
Borrowers, the Security Parties, the Security Trustee, and the other
Lenders of the notice under Clause 23.1 which
the Agent receives from the Notifying
Lender.
|
|
23.3
|
Prepayment; termination of
Commitment. On the Agent notifying the Borrowers under
Xxxxxx 23.2, the Notifying Xxxxxx’s Available
Commitment shall terminate by no later than the date specified in the
Notifying Lender’s notice under Clause 23.1
as the date on which the notified event would become effective the
Borrowers shall prepay the Notifying Lender’s Contribution in accordance
with Clause 8.
|
|
23.4
|
Mitigation. If
circumstances arise which would result in a notification under
Clause 23.1 then, without in any way limiting the rights of the
Notifying Lender under Clause 23.3, the Notifying Lender shall use
reasonable endeavours to transfer its obligations, liabilities and rights
under this Agreement and the Finance Documents to another office or
financial institution not affected by the circumstances but the Notifying
Lender shall not be under any obligation to take any such action if, in
its opinion, to do would or might:
|
|
(a)
|
have
an adverse effect on its business, operations or financial condition;
or
|
|
(b)
|
involve
it in any activity which is unlawful or prohibited or any activity that is
contrary to, or inconsistent with, any regulation;
or
|
|
(c)
|
involve
it in any expense (unless indemnified to its satisfaction) or tax
disadvantage
|
|
24
|
INCREASED
COSTS
|
|
24.1
|
Increased
costs. This Clause 24
applies if a Lender (the “Notifying Lender”)
notifies the Agent that the Notifying Xxxxxx considers that as a result
of:
|
|
(a)
|
the
introduction or alteration after the date of this Agreement of a law or an
alteration after the date of this Agreement in the manner in which a law
is interpreted or applied (disregarding any effect which relates to the
application to payments under this Agreement of a tax on the Notifying
Xxxxxx’s overall net income); or
|
|
(b)
|
complying
with any regulation (including any which relates to capital adequacy or
liquidity controls or which affects the manner in which the Notifying
Lender allocates capital resources to its obligations under this
Agreement) which is introduced, or altered, or the interpretation or
application of which is altered, after the date of this
Agreement,
|
the
Notifying Lender (or a parent company of it) has incurred or will incur an
“increased
cost”.
|
24.2
|
Meaning of “increased
cost”. In this Clause 24,
“increased cost”
means, in relation to a Notifying
Lender:
|
|
(a)
|
an
additional or increased cost incurred as a result of, or in connection
with, the Notifying Lender having entered into, or being a party to, this
Agreement or a Transfer Certificate, of funding or maintaining its
Commitment or Contribution or performing its obligations under this
Agreement, or of having outstanding all or any part of its Contribution or
other unpaid sums;
|
|
(b)
|
a
reduction in the amount of any payment to the Notifying Lender under this
Agreement or in the effective return which such a payment represents to
the Notifying Lender or on its
capital;
|
|
(c)
|
an
additional or increased cost of funding all or maintaining all or any of
the advances comprised in a class of advances formed by or including the
Notifying Lender’s Contribution or (as the case may require) the
proportion of that cost attributable to the Contribution;
or
|
|
(d)
|
a
liability to make a payment, or a return foregone, which is calculated by
reference to any amounts received or receivable by the Notifying Lender
under this Agreement;
|
but not
an item attributable to a change in the rate of tax on the overall net income of
the Notifying Lender (or a parent company of it) or an item covered by the
indemnity for tax in Clause 21.1 or by Clause 22 or an item arising directly out of the
implementation by the applicable authorities having jurisdiction over the
Notifying Lender of the matters set out in the statement of the Basle Committee
on Banking Regulations and Supervisory Practices dated July 1988 and entitled
“International Convergence of Capital Measurement and Capital Standards”, to the
extent and according to the timetable provided for in the
statement.
For the
purposes of this Clause 24.2 the Notifying Lender
may in good faith allocate or spread costs and/or losses among its assets and
liabilities (or any class of its assets and liabilities) on such basis as it
considers appropriate.
|
24.3
|
Notification to Borrowers of
claim for increased costs. The Agent shall promptly
notify the Borrowers and the Security Parties of the notice which the
Agent received from the Notifying Lender under Clause 24.1.
|
|
24.4
|
Payment of increased
costs. The Borrowers shall pay to the Agent, on the
Agent’s demand, for the account of the Notifying Lender the amounts which
the Agent from time to time notifies the Borrowers that the Notifying
Xxxxxx has specified to be necessary to compensate the Notifying Lender
for the increased cost (provided that such demand is accompanied by a
certificate from the Notifying Lender confirming the amount of its
increased cost and including a calculation
thereof).
|
|
24.5
|
Notice of prepayment or
cancellation. If the Borrowers are not willing to
continue to compensate the Notifying Lender for the increased cost under
Clause 24.4, the Borrowers may give the Agent
not less than 90 days’ notice of their intention to prepay the Notifying
Lender’s Contribution at the end of an Interest Period and/or to cancel
the Notifying Xxxxxx’s Available
Commitment.
|
|
24.6
|
Prepayment; termination of
Commitment. A notice under Clause 24.5 shall be irrevocable; the Agent shall
promptly notify the Notifying Lender of the Borrowers’ notice of intended
prepayment and/or intended cancellation;
and:
|
|
(a)
|
on
the date on which the Agent serves that notice, the Commitment of the
Notifying Lender shall be cancelled;
and
|
|
(b)
|
on
the date specified in its notice of intended prepayment, the Borrowers
shall prepay (without premium or penalty) the Notifying
Lender’s Contribution, together with accrued interest thereon
at the applicable rate plus the
Margin.
|
|
24.7
|
Application of
prepayment. Save to the extent stated above Clause 8 shall apply in relation to the
prepayment.
|
|
24.8
|
Mitigation. If
circumstances arise which would result in a notification under
Clause 24.1 then, without in any way limiting the rights of the
Notifying Lender under Clause 24.3, the Notifying Lender shall use
reasonable endeavours to transfer its obligations, liabilities and rights
under this Agreement and the Finance Documents to another office or
financial institution not affected by the circumstances but the Notifying
Lender shall not be under any obligation to take any such action if, in
its opinion, to do so would or
might:
|
|
(a)
|
have
an adverse effect on its business, operations or financial condition;
or
|
|
(b)
|
involve
it in any activity which is unlawful or prohibited or any activity that is
contrary to, or inconsistent with, any regulation;
or
|
|
(c)
|
involve
it in any expense (unless indemnified to its satisfaction) or tax
disadvantage.
|
|
25
|
SET-OFF
|
|
25.1
|
Application of credit
balances. Each Creditor Party may without prior notice
following the occurrence of an Event of Default which is
continuing:
|
|
(a)
|
apply
any balance (whether or not then due) which at any time stands to the
credit of any account in the name of any Borrower at any office in any
country of that Creditor Party in or towards satisfaction of any sum then
due from the Borrowers to that Creditor Party under any of the Finance
Documents; and
|
|
(b)
|
for
that purpose:
|
|
(i)
|
break,
or alter the maturity of, all or any part of a deposit of any
Borrower;
|
|
(ii)
|
convert
or translate all or any part of a deposit or other credit balance into
Dollars;
|
|
(iii)
|
enter
into any other transaction or make any entry with regard to the credit
balance which the Creditor Party concerned considers
appropriate.
|
|
25.2
|
Existing rights
unaffected. No Creditor Party shall be obliged to
exercise any of its rights under Clause 25.1;
and those rights shall be without prejudice and in addition to any right
of set-off, combination of accounts, charge, lien or other right or remedy
to which a Creditor Party is entitled (whether under the general law or
any document).
|
|
25.3
|
Sums deemed due to a
Lender. For the purposes of this Clause 25, a sum payable by the Borrowers to the Agent
or the Security Trustee for distribution to, or for the account of, a
Lender shall be treated as a sum due to that Lender; and each Lender’s
proportion of a sum so payable for distribution to, or for the account of,
the Lenders shall be treated as a sum due to such
Lender.
|
|
25.4
|
No Security
Interest. This Clause 25
gives the Creditor Parties a contractual right of set-off only, and does
not create any equitable charge or other Security Interest over any credit
balance of the Borrowers.
|
|
26
|
TRANSFERS
AND CHANGES IN LENDING OFFICES
|
|
26.1
|
Transfer by
Borrowers. No Borrower may, without the consent of the
Agent, given on the instructions of all the Lenders transfer any of its
rights, liabilities or obligations under any Finance
Document.
|
|
26.2
|
Transfer by a
Lender. Subject to Clause 26.4, a Lender (the “Transferor Lender”) may
at any time, with the prior written consent of the Borrowers (not to be
unreasonably withheld or delayed) or without the consent of the Borrowers
if an Event of Default or a Potential Event of Default has occurred and is
continuing, cause:
|
|
(a)
|
its
rights in respect of all or part of its Contribution;
or
|
|
(b)
|
its
obligations in respect of all or part of its Commitment;
or
|
|
(c)
|
a
combination of (a) and (b);
|
to be (in
the case of its rights) transferred to, or (in the case of its obligations)
assumed by, another bank or financial institution (a “Transferee Lender”) by
delivering to the Agent a completed certificate in the form set out in Schedule
4 with any modifications approved or required by the Agent (a “Transfer Certificate”)
executed by the Transferor Lender and the Transferee Lender Provided that a
Lender may make such transfer to any wholly owned subsidiary of it, to its
parent company or to another subsidiary of its parent company without the
consent of the Borrowers and provided further that the Borrowers may withhold
their consent aforesaid if the proposed transfer would result in the Borrowers
being obliged to make a payment to the Transferee under Clause 22 or Clause 24.
However
any rights and obligations of the Transferor Lender in its capacity as Agent or
Security Trustee will have to be dealt with separately in accordance with the
Agency and Trust Agreement.
|
26.3
|
Transfer Certificate, delivery
and notification. As soon as reasonably practicable
after a Transfer Certificate is delivered to the Agent, it shall (unless
it has reason to believe that the Transfer Certificate may be
defective):
|
|
(a)
|
sign
the Transfer Certificate on behalf of itself, the Borrowers, the Security
Parties, the Security Trustee and each of the other Creditor
Parties;
|
|
(b)
|
on
behalf of the Transferee Lender, send to the Borrowers and each Security
Party letters or faxes notifying them of the Transfer Certificate and
attaching a copy of it;
|
|
(c)
|
send
to the Transferee Lender copies of the letters or faxes sent under
paragraph (b) above.
|
|
26.4
|
Effective Date of Transfer
Certificate. A Transfer Certificate becomes effective on
the Transfer Date.
|
|
26.5
|
No transfer without Transfer
Certificate. No assignment or transfer of any right or
obligation of a Lender under any Finance Document is binding on, or
effective in relation to, the Borrowers, any Security Party, the Agent or
the Security Trustee unless it is effected, evidenced or perfected by a
Transfer Certificate.
|
|
26.6
|
Lender re-organisation; waiver
of Transfer Certificate. However, if a Lender enters
into any merger, de-merger or other reorganisation as a result of which
all its rights or obligations vest in another person (the “successor”), the Agent
may, if it sees fit, by notice to the successor and the Borrowers and the
Security Trustee waive the need for the execution and delivery of a
Transfer Certificate; and, upon service of the Agent’s notice, the
successor shall become a Lender with the same Commitment and Contribution
as were held by the predecessor
Lender.
|
|
26.7
|
Effect of Transfer
Certificate. A Transfer Certificate takes effect in
accordance with English law as
follows:
|
|
(a)
|
to
the extent specified in the Transfer Certificate, all rights and interests
(present, future or contingent) which the Transferor Lender has under or
by virtue of the Finance Documents are assigned to the Transferee Lender
absolutely, free of any defects in the Transferor Xxxxxx’s title and of
any rights or equities which the Borrowers or any Security Party had
against the Transferor Lender;
|
|
(b)
|
the
Transferor Lender’s Commitment is discharged to the extent specified in
the Transfer Certificate;
|
|
(c)
|
the
Transferee Lender becomes a Lender with the Contribution or Commitment of
an amount specified in the Transfer
Certificate;
|
|
(d)
|
the
Transferee Lender becomes bound by all the provisions of the Finance
Documents which are applicable to the Lenders generally, including those
about pro-rata sharing and the exclusion of liability on the part of, and
the indemnification of, the Agent and the Security Trustee and, to the
extent that the Transferee Lender becomes bound by those provisions (other
than those relating to exclusion of liability), the Transferor Lender
ceases to be bound by them;
|
|
(e)
|
any
part of the Loans which the Transferee Lender advances after the Transfer
Certificate’s effective date ranks in point of priority and security in
the same way as it would have ranked had it been advanced by the
transferor, assuming that any defects in the transferor’s title and any
rights or equities of the Borrowers or any Security Party against the
Transferor Lender had not existed;
|
|
(f)
|
the
Transferee Lender becomes entitled to all the rights under the Finance
Documents which are applicable to the Lenders generally, including but not
limited to those relating to the Majority Lenders and those under Clause
5.7 and Clause 20, and to the extent that the Transferee Lender
becomes entitled to such rights, the Transferor Lender ceases to be
entitled to them; and
|
|
(g)
|
in
respect of any breach of a warranty, undertaking, condition or other
provision of a Finance Document or any misrepresentation made in or in
connection with a Finance Document, the Transferee Lender shall be
entitled to recover damages by reference to the loss incurred by it as a
result of the breach or misrepresentation, irrespective of whether the
original Lender would have incurred a loss of that kind or
amount.
|
The
rights and equities of the Borrowers or any Security Party referred to above
include, but are not limited to, any right of set off and any other kind of
cross-claim.
|
26.8
|
Maintenance of register of
Lenders. During the Security Period the Agent shall
maintain a register in which it shall record the name, the Commitment, the
Contribution and administrative details (including the lending office)
from time to time of each Lender holding a Transfer Certificate and the
effective date (in accordance with Clause 26.4) of the Transfer Certificate; and the Agent
shall make the register available for inspection by the Security Trustee
and the Borrowers during normal banking hours, subject to receiving at
least 3 Business Days prior notice.
|
|
26.9
|
Reliance on register of
Lenders. The entries on that register shall, in the
absence of manifest error, be conclusive in determining the identities of
the Lenders and the amounts of their Commitments, Contributions and the
effective dates of Transfer Certificates and may be relied upon by the
Agent and the other parties to the Finance Documents for all purposes
relating to the Finance Documents.
|
|
26.10
|
Authorisation of Agent to sign
Transfer Certificates. Subject to the foregoing
provisions of this Clause 26 the Borrowers, the Security Trustee and each
Lender irrevocably authorise the Agent to sign Transfer Certificates on
its behalf.
|
|
26.11
|
Registration
fee. In respect of any Transfer Certificate, the Agent
shall be entitled to recover a registration fee of $2,000 from the
Transferor Lender or (at the Agent’s option) the Transferee Creditor
Party.
|
|
26.12
|
Sub-participation; subrogation
assignment. A Lender may sub-participate all or any part
of its rights and/or obligations under or in connection with the Finance
Documents without the consent of, or any notice to, the Borrowers, any
Security Party, the Agent, the Security Trustee or any other Creditor
Party; and the Lenders may assign, in any manner and terms agreed by the
Majority Lenders, the Agent and the Security Trustee all or any part of
those rights to an insurer or surety who has become subrogated to
them.
|
|
26.13
|
Disclosure of
information. A Lender may disclose to a potential
Transferee Lender or sub-participant any information which the Lender has
received in relation to the Borrowers, any Security Party or their affairs
under or in connection with any Finance
Document.
|
|
26.14
|
Change of lending
office. A Lender may change its lending office by giving
notice to the Agent and the change shall become effective on the later
of:
|
|
(a)
|
the
date on which the Agent receives the notice;
and
|
|
(b)
|
the
date, if any, specified in the notice as the date on which the change will
come into effect.
|
|
26.15
|
Notification. On
receiving such a notice, the Agent shall notify the Borrowers and the
Security Trustee; and, until the Agent receives such a notice, it shall be
entitled to assume that a Lender is acting through the lending office of
which the Agent last had notice.
|
|
26.16
|
Replacement of Reference
Bank. If any Reference Bank ceases to be a Lender or is
unable on a continuing basis to supply quotations for the purposes of
Clause 5 then, unless the Borrowers, the
Agent and the Majority Lenders otherwise agree, the Agent, acting on the
instructions of the Majority Lenders, and after consulting the Borrowers,
shall appoint another bank (whether or not a Lender) to be a replacement
Reference Bank; and, when that appointment comes into effect, the
first-mentioned Reference Bank’s appointment shall cease to be
effective.
|
|
26.17
|
No additional
costs. If a Lender transfers any part of its
Contribution and/or Commitment or sub-participates any part of its rights
and/or obligations under the Finance Documents or changes it lending
office pursuant to this Clause 26 and as a
result of circumstances existing at the date the transfer, sub
participation or change occurs, the Borrowers would be obliged to make an
increased payment to that Lender under any applicable Clauses of this
Agreement, then that Lender is only entitled to receive payment under
those Clauses to the same extent as the Lender would have been if the
transfer, sub-participation or change of lending office had not
occurred.
|
|
27
|
VARIATIONS
AND WAIVERS
|
|
27.1
|
Variations, waivers etc. by
Xxxxxxxx Xxxxxxx. Subject to Clause 27.2, a document shall be effective to vary,
waive, suspend or limit any provision of a Finance Document, or any
Creditor Party’s rights or remedies under such a provision or the general
law, only if the document is signed, or specifically agreed to by fax, by
the Borrowers, by the Agent on behalf of the Majority Lenders, by the
Agent and the Security Trustee in their own rights, and, if the document
relates to a Finance Document to which a Security Party is party, by that
Security Party.
|
|
27.2
|
Variations, waivers etc.
requiring agreement of all Lenders. However, as regards
the following, Clause 27.1 applies as if the
words “by the Agent on behalf of the Majority Lenders” were replaced by
the words “by or on behalf of every
Lender”:
|
|
(a)
|
a
reduction in the Margin or in the definition of
LIBOR;
|
|
(b)
|
an
extension of the due date for, or a decrease in the amount of, any payment
of principal, interest, fees, or other sum payable under this
Agreement;
|
|
(c)
|
an
increase in any Lender’s
Commitment;
|
|
(d)
|
an
extension of Availability Period;
|
|
(e)
|
a
change to the definition of “Majority Lenders” or
“Finance
Documents”;
|
|
(g)
|
a
change to this Clause 27;
|
|
(h)
|
any
release of, or material variation to, a Security Interest, guarantee,
indemnity or subordination arrangement set out in a Finance Document;
and
|
|
(i)
|
any
other change or matter as regards which this Agreement or another Finance
Document expressly provides that each Lender’s consent is
required.
|
|
27.3
|
Exclusion of other or implied
variations. Except for a document which satisfies the
requirements of Clauses 27.1 and 27.2, no document, and no act, course of
conduct, failure or neglect to act, delay or acquiescence on the part of
the Creditor Parties or any of them (or any person acting on behalf of any
of them) shall result in the Creditor Parties or any of them (or any
person acting on behalf of any of them) being taken to have varied,
waived, suspended or limited, or being precluded (permanently or
temporarily) from enforcing, relying on or
exercising:
|
|
(a)
|
a
provision of this Agreement or another Finance Document;
or
|
|
(b)
|
an
Event of Default; or
|
|
(c)
|
a
breach by any Borrower or a Security Party of an obligation under a
Finance Document or the general law;
or
|
|
(d)
|
any
right or remedy conferred by any Finance Document or by the general
law;
|
|
|
and
there shall not be implied into any Finance Document any term or condition
requiring any such provision to be enforced, or such right or remedy to be
exercised, within a certain or reasonable
time.
|
|
28
|
NOTICES
|
|
28.1
|
General. Unless
otherwise specifically provided, any notice under or in connection with
any Finance Document shall be given by letter or fax; and references in
the Finance Documents to written notices, notices in writing and notices
signed by particular persons shall be construed
accordingly.
|
|
28.2
|
Addresses for
communications. A notice shall be
sent:
|
|
(a)
|
to
the Borrowers:Suite 306
|
Commerce
Building
One
Chancery Xxxx
Xxxxxxxx
HM12
Bermuda
Mailing
Address:
P.O. Box
HM 2522
Hamilton
HMGX
Bermuda
Attention: Xxxxxxx X. Xxxx
Fax:
x0-000-000-0000
With a copy
to:
TBS
Shipping Services Inc.
000 Xxxx
Xxxxxx Xxxxxx Xxxx
Yonkers,
NY 10710 U.S.A.
Attention: Xxxxxxxxx
X. Xxxxxx
Fax: x0-000-000-0000
|
(b)
|
to
a
Lender: At
the address below its name in Schedule 1 or (as the case may require) in
the relevant Transfer Certificate.
|
|
(c)
|
to
the
Agent: In
respect of operational matters (such as drawdowns, interest rate fixing,
interest/fee calculations and
payments:
|
The Royal
Bank of Scotland plc
Level
3
0x
Xxxxxxxxxx Xxxxxx
London
EC2M 4XJ
Fax No:
x00 000 000 0000
Attention:
Loans Administration/XXX
in
respect of non operational matters (such as documentation, covenant compliance,
amendments and waivers etc)
The Royal
Bank of Scotland plc
Shipping
Business Centre
0-00
Xxxxx Xxxxx Xxxxxx
London
EC3P 3HX
Fax No:
x00 000 000 0000
Attention:
Transaction and Portfolio Management
|
(d)
|
to
the Security
Trustee: The
Royal Bank of Scotland plc
|
Level
5
135
Bishopsgate
London
EC2M 3UR
Fax No:
x00 000 000 0000
Attention:
Syndicated Loans Agency
or to
such other address as the relevant party may notify the Agent or, if the
relevant party is the Agent or the Security Trustee, the Borrowers, the Lenders,
and the Security Parties.
|
(a)
|
a
notice which is delivered personally or posted shall be deemed to be
served, and shall take effect, at the time when it is
delivered;
|
|
(b)
|
a
notice which is sent by fax shall be deemed to be served, and shall take
effect, 2 hours after its transmission is
completed.
|
|
28.4
|
Service outside business
hours. However, if under Clause 28.3 a notice would be deemed to be
served:
|
|
(a)
|
on
a day which is not a business day in the place of receipt;
or
|
|
(b)
|
on
such a business day, but after 5 p.m. local
time;
|
the
notice shall (subject to Clause 28.5) be deemed to
be served, and shall take effect, at 9 a.m. on the next day which is such a
business day.
|
28.5
|
|
28.6
|
Valid
notices. A notice under or in connection with a Finance
Document shall not be invalid by reason that its contents or the manner of
serving it do not comply with the requirements of this Agreement or, where
appropriate, any other Finance Document under which it is served
if:
|
|
(a)
|
the
failure to serve it in accordance with the requirements of this Agreement
or other Finance Document, as the case may be, has not caused any party to
suffer any significant loss or
prejudice; or
|
|
(b)
|
in
the case of incorrect and/or incomplete contents, it should have been
reasonably clear to the party on which the notice was served what the
correct or missing particulars should have
been.
|
|
28.7
|
English
language. Any notice under or in connection with a
Finance Document shall be in
English.
|
|
28.8
|
Meaning of
“notice”. In this Clause 28, “notice” includes any
demand, consent, authorisation, approval, instruction, waiver or other
communication.
|
|
28.9
|
Electronic
communication
|
|
(a)
|
Any
communication to be made between the Agent and a Creditor Party under or
in connection with the Finance Documents may be made by electronic mail or
other electronic means, if the Agent and the relevant Creditor
Party:
|
|
(i)
|
agree
that, unless and until notified to the contrary, this is to be an accepted
form of communication;
|
|
(ii)
|
notify
each other in writing of their electronic mail address and/or any other
information required to enable the sending and receipt of information by
that means; and
|
|
(iii)
|
notify
each other of any change to their address or any other such information
supplied by them.
|
|
(b)
|
Any
electronic communication made between the Agent and a Creditor Party will
be effective only when actually received in readable form and in the case
of any electronic communication made by a Creditor Party to the Agent only
if it is addressed in such a manner as the Agent shall specify for this
purpose.
|
|
29
|
JOINT
AND SEVERAL LIABILITY
|
|
29.1
|
General. All
liabilities and obligations of the Borrowers under this Agreement shall,
whether expressed to be so or not, be several and, if and to the extent
consistent with Clause 29.2,
joint.
|
|
29.2
|
No impairment of Xxxxxxxx's
obligations. The liabilities and obligations of a
Borrower shall not be impaired by:
|
|
(a)
|
this
Agreement being or later becoming void, unenforceable or illegal as
regards any other Borrower;
|
|
(b)
|
any
Lender, Swap Bank or the Security Trustee entering into any rescheduling,
refinancing or other arrangement of any kind with any other
Borrower;
|
|
(c)
|
any
Lender, Swap Bank or the Security Trustee releasing any other Borrower or
any Security Interest created by a Finance Document;
or
|
|
(d)
|
any
combination of the foregoing.
|
|
29.3
|
Principal
debtors. Each Borrower declares that it is and will,
throughout the Security Period, remain a principal debtor for all amounts
owing under this Agreement and the Finance Documents and no Borrower shall
in any circumstances be construed to be a surety for the obligations of
any other Borrower under this
Agreement.
|
|
29.4
|
Subordination. Subject
to Clause 29.5, during the Security Period,
no Borrower shall:
|
|
(a)
|
claim
any amount which may be due to it from any other Borrower whether in
respect of a payment made, or matter arising out of, this Agreement or any
Finance Document, or any matter unconnected with this Agreement or any
Finance Document; or
|
|
(b)
|
take
or enforce any form of security from any other Borrower for such an
amount, or in any other way seek to have recourse in respect of such an
amount against any asset of any other Borrower;
or
|
|
(c)
|
set
off such an amount against any sum due from it to any other Borrower;
or
|
|
(d)
|
prove
or claim for such an amount in any liquidation, administration,
arrangement or similar procedure involving any other Borrower or other
Security Party; or
|
|
(e)
|
exercise
or assert any combination of the
foregoing.
|
|
29.5
|
Borrower's required
action. If during the Security Period, the Agent, by
notice to a Borrower, requires it to take any action referred to in
paragraphs (a) to (d) of Clause 29.4, in
relation to any other Borrower, that Borrower shall take that action as
soon as practicable after receiving the Agent's
notice.
|
|
30
|
SUPPLEMENTAL
|
|
30.1
|
Rights cumulative,
non-exclusive. The rights and remedies which the Finance
Documents give to each Creditor Party
are:
|
|
(a)
|
cumulative;
|
|
(b)
|
may
be exercised as often as appears expedient;
and
|
|
(c)
|
shall
not, unless a Finance Document explicitly and specifically states so, be
taken to exclude or limit any right or remedy conferred by any
law.
|
|
30.2
|
Severability of
provisions. If any provision of a Finance Document is or
subsequently becomes void, unenforceable or illegal, that shall not affect
the validity, enforceability or legality of the other provisions of that
Finance Document or of the provisions of any other Finance
Document.
|
|
30.3
|
Counterparts. A
Finance Document may be executed in any number of
counterparts.
|
|
30.4
|
Third party
rights. A person who is not a party to this Agreement
has no right under the Contracts (Rights of Third Parties) Act 1999 to
enforce or to enjoy the benefit of any term of this
Agreement.
|
|
31
|
LAW
AND JURISDICTION
|
|
31.1
|
English
law. This Agreement and any non-contractual obligations
arising out of or in connection with it shall be governed by, and
construed in accordance with, English
law.
|
|
31.2
|
Exclusive English
jurisdiction. Subject to Clause 31.3, the courts of England shall have exclusive
jurisdiction to settle any Dispute.
|
|
31.3
|
Choice of forum for the
exclusive benefit of the Creditor Parties. Clause 36.2
is for the exclusive benefit of the Creditor Parties, each of which
reserves the right:
|
|
(a)
|
to
commence proceedings in relation to any Dispute in the courts of any
country other than England and which have or claim jurisdiction to that
Dispute; and
|
|
(b)
|
to
commence such proceedings in the courts of any such country or countries
concurrently with or in addition to proceedings in England or without
commencing proceedings in England.
|
No
Borrower shall commence any proceedings in any country other than England in
relation to a Dispute.
|
31.4
|
Process
agent. Each Borrower irrevocably appoints Xxxxxx Xxxxx
Xxxxxxx LLP at its registered office for the time being, presently at 0
Xxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx XX00 0XX, to act as its agent to
receive and accept on its behalf any process or other document relating to
any proceedings in the English courts which are connected with a
Dispute.
|
|
31.5
|
Creditor Party rights
unaffected. Nothing in this Clause 31 shall exclude or limit any right which any
Creditor Party may have (whether under the law of any country, an
international convention or otherwise) with regard to the bringing of
proceedings, the service of process, the recognition or enforcement of a
judgment or any similar or related matter in any
jurisdiction.
|
|
31.6
|
Meaning of
“proceedings”. In this Clause 31, “proceedings” means
proceedings of any kind, including an application for a provisional or
protective measure and a “Dispute” means any
dispute arising out of or in connection with this Agreement (including a
dispute relating to the existence, validity or termination of this
Agreement) or any contractual obligation arising out of or in connection
with this Agreement.
|
THIS AGREEMENT has been
entered into on the date stated at the beginning of this Agreement.
SCHEDULE
1
LENDERS
|
Lender
|
Lending
Office
|
Commitment
|
|
The
Royal Bank of Scotland plc
|
Shipping
Business Centre
0-00
Xxxxx Xxxxx Xxxxxx
Xxxxxx
XX0X 0XX
Fax
No: +
44 207 085 7142
Attn:
Transaction and Portfolio Management
|
$35,000,000
|
|
Citibank,
N.A.
|
000
Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx
XX00000
XXX
Fax
No: + 0 000 000 0000
Attn:
Xxxxxxx Xxxxxx
|
$15,000,000
|
|
Landesbank
Hessen-Thüringen Girozentrale
|
000
Xxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, XX 000000-0000
XXX
Fax
No: x0 000 000 0000
Attn:
Corporate Finance/ Portfolio Management
|
$30,000,000
|
|
Norddeutsche
Landesbank Girozentrale
|
Ship
and Aircraft Finance Department
Xxxxxxxxxxxxxx
00
00000
Xxxxxxxx, Xxxxxxx
Fax
No: x00 000 000 0000
Attn:
International Shipping Group II - Xxxxxxxxx Xxxxxxxx
|
$30,000,000
|
|
Alliance
& Leicester Commercial Finance plc
|
000 Xxxxxxxxx
Xxxxxxxxxx
X0
0XX
Fax
No: + 00 000 000 0000
Attn
Corporate Administration Manager
|
$30,000,000
|
|
Bank
of America, N.A.
|
Bank
of America
000
Xxxxxxx Xxxxxx
Xxxxxx
XX 00000
Fax
No: x000000 0000
Attn:
Transportation Division - Credit Products
|
$10,000,000
|
26357268
vDOC
SCHEDULE
2
DRAWDOWN
NOTICE
To: The
Royal Bank of Scotland plc
Level 3
0x Xxxxxxxxxx Xxxxxx
London EC2M 4XJ
Attention:
Loans Administration/XXX
[l]
DRAWDOWN
NOTICE
|
1
|
We
refer to the loan agreement (the “Loan Agreement”) dated
as of 29 March 2007 and made between Argyle Maritime Corp., Xxxxx Maritime
Corp., Dorchester Maritime Corp., Longwoods Maritime Corp., XxXxxxx
Maritime Corp. and Sunswyck Maritime Corp., as Borrowers, the Lenders
referred to therein, and The Royal Bank of Scotland plc as Mandated Lead
Arranger, Bookrunner, Agent, Security Trustee, and Swap Bank in connection
with a term loan facility of US$150,000,000. Terms defined in
the Loan Agreement have their defined meanings when used in this Drawdown
Notice.
|
|
2
|
We
request to borrow an Advance under the Loan Facility as
follows:
|
|
(a)
|
Amount:
US$[l];
|
|
(b)
|
Drawdown
Date: [l];
|
|
(c)
|
[Duration
of the first Interest Period shall be [l]
months;]
|
|
(d)
|
Payment
instructions : account in our name and numbered [l] with [l] of [l].
|
|
3
|
We
represent and warrant that:
|
|
(a)
|
the
representations and warranties in Clause 10 of the Loan Agreement would
remain true and not misleading if repeated on the date of this notice with
reference to the circumstances now
existing;
|
|
(b)
|
no
Event of Default or Potential Event of Default has occurred and is
continuing or will result from the borrowing of the
Loans.
|
|
4
|
This
notice cannot be revoked without the prior consent of the Majority
Lenders.
|
|
5
|
We
authorise you to deduct the fees referred to in Clause 20 and due to you
for the account of the Lenders from the amount of the said
Advance.
|
[Name of
Signatory]
for and
on behalf of
[relevant
Borrower]
[l]
[l]
SCHEDULE
3
CONDITION
PRECEDENT DOCUMENTS
PART
A
The
following are the documents referred to in Clause 9.1(a) required before service
of the first Drawdown Notice.
|
1
|
A
duly executed original of each Finance Document (and of each document
required to be delivered by each Finance Document) other than those
referred to in Part B or Part C or Part
D.
|
|
2
|
Copies
of the certificate of incorporation, constitutional documents and evidence
of the goodstanding (or its equivalent) of each Borrower and each Security
Party.
|
|
3
|
Copies
of resolutions of the directors of each Borrower and each Security Party
and copies of resolutions of the shareholders of each Borrower, in each
case authorising the execution of each of the Finance Documents to which
that Borrower or that Security Party is a party and, in the case of each
Borrower, authorising named officers to give the Drawdown Notices and
other notices under this Agreement and ratifying the execution of the
Shipbuilding Contracts.
|
|
4
|
The
original of any power of attorney under which any Finance Document is
executed on behalf of a Borrower or a Security
Party.
|
|
5
|
Copies
of all consents which any Borrower or any Security Party requires to enter
into, or make any payment under, any Finance Document or the Shipbuilding
Contracts.
|
|
6
|
Copies
of the Shipbuilding Contracts and the Overall
Agreement.
|
|
7
|
Such
documentary evidence as the Agent and its legal advisers may require in
relation to the due authorisation and execution by the Seller of the
Shipbuilding Contracts and the Overall
Agreement.
|
|
8
|
Documentary
evidence that the agent for service of process named in Clause 31 has accepted its
appointment.
|
|
9
|
Favourable
legal opinions from lawyers appointed by the Agent on such matters
concerning the laws of Bermuda and Xxxxxxxx
Islands.
|
|
10
|
A
written confirmation from the Borrowers as to which individuals are
authorised to give verbal and/or written instructions to the Agent on
behalf of the Borrowers in respect of the selection of any Interest Period
pursuant to Clause 6.2 of this
Agreement.
|
|
11
|
A
written statement from a person acceptable to the Agent confirming the
identity of the ultimate beneficial owner or owners of the shares in the
Borrowers, the Corporate Guarantor and each other Security Party and of
the identity of the person or persons controlling the voting rights
attached to those shares.
|
|
12
|
Such
documents and evidence as the Agent shall require in relation to each
Security Party based on applicable law and regulations, and the Agent’s
own internal guidelines, relating to the Agent’s knowledge of its
customers.
|
|
13
|
Such
documentary evidence as the Agent and its legal advisers may require in
relation to the due authorisation and execution by the parties to the
Intercreditor Agreement (other than the Creditor
Parties).
|
|
14
|
If
the Agent so requires, in respect of any of the documents referred to
above, a certified English translation prepared by a translator approved
by the Agent.
|
Each of
the documents specified in paragraphs 2, 3, 5, and 6 of Part A and every other
copy document delivered under this Schedule shall be certified as a true and up
to date copy by a director, representative director, or the secretary (or
equivalent officer) of the relevant Borrower.
PART
B
The
following are the documents referred to in Clause 9.1(b) required before the
drawdown of a Advance (other than a Delivery Advance) in respect of a Ship to be
acquired using the proceeds of such Advance:
|
1
|
evidence
that the relevant stage payment of the Contract Price payable under the
Shipbuilding Contract in respect of such Ship payable under the relevant
Shipbuilding Contract has fallen due for payment or, in the case of each
of Ship D, Ship E and Ship F and the relevant Advance to be utilised to
reimburse the relevant Borrower the second instalment of the Contract
Price payable under the relevant Shipbuilding Contract that such
instalment has been paid to the Seller and that the stage of steel cutting
for such Ship has been completed;
|
|
2
|
the
Pre-delivery Security Assignment in respect of the Shipbuilding Contract
relating to such Ship (and of each document to be delivered thereunder);
and
|
|
3
|
favourable
legal opinions from lawyers appointed by the Agent on such matters
concerning the laws of the Xxxxxxxx Islands and
China.
|
|
4
|
a
copy of the relevant Refund Guarantee together with such documentary
evidence as the Agent, and its legal advisers may require in relation to
the due authorisation and execution by the Refund Guarantor of that Refund
Guarantee and that such Refund Guarantee has been registered with the
State Administration of Foreign Exchange in
China.
|
PART
C
The
following are the documents referred to in Clause 9.1(d) required before the
drawdown of a Delivery Advance in respect of a Ship to be acquired using the
proceeds of such Delivery Advance:
|
1
|
|
(a)
|
A
duly executed original of the Mortgage and Multiparty Deed relating to the
Ship (and of each document to be delivered by each of them);
and
|
|
(b)
|
in
relation to the First Delivery Advance a duly executed original of the
Account Security Deed and the originals of any mandates or other documents
required in connection with the opening and operation of the Earnings
Account and the Standby Earnings
Account.
|
|
2
|
Documentary
evidence that:
|
|
(a)
|
the
Ship has been or on the relevant Delivery Date will be unconditionally
delivered by the Sellers to, and accepted by, the relevant Borrower under
the relevant Shipbuilding Contract and the full purchase price payable
under the relevant Shipbuilding Contract has been duly
paid;
|
|
(b)
|
the
Ship is or on the relevant Delivery Date will be registered in the name of
the relevant Borrower with the Panamanian ship
registry;
|
|
(c)
|
the
Ship is or on the relevant Delivery Date will be in the absolute and
unencumbered ownership of the relevant Borrower save as contemplated by
the Finance Documents;
|
|
(d)
|
the
Ship has or on the relevant Delivery Date will have its Classification
with its classification society, free of all recommendations and
qualifications of such classification
society;
|
|
(e)
|
the
relevant Mortgage has been or on the Delivery Date will be duly registered
against the Ship as a valid first preferred Panamanian ship mortgage in
accordance with the laws of Panama;
|
|
(f)
|
the
Ship is insured in accordance with the provisions of this Agreement and
all requirements therein in respect of insurances have been complied with
and a certified copy of the certificate of financial responsibility for
pollution by oil or other Environmentally Sensitive Material issued by the
relevant certifying authority in relation to that
Ship;
|
|
(g)
|
the
Ship has been or on the relevant Delivery Date will be unconditionally
delivered by the relevant Borrower to, and accepted by, the Bareboat
Charterer under the relevant Bareboat Charter and the Ship has been
bareboat registered under the Philippine’s flag (with details of the
Mortgage duly noted on the Ship’s bareboat
register);
|
|
(h)
|
the
Ship has been or on the relevant Delivery Date will be unconditionally
delivered by the Bareboat Charter to, and accepted by, the Time Charterer
under the relevant Time Charter;
|
|
3
|
Documents
establishing that the Ship will, as from the relevant Drawdown Date, be
managed by the Approved Managers on terms acceptable to the Lenders,
together with:
|
|
(a)
|
a
letter or letters of undertaking executed by the Approved Managers in
favour of the Agent in the terms required by the Agent agreeing certain
matters in relation to the management of that Ship and subordinating the
rights of the Approved Managers against the Borrowers and that Ship to the
rights of the Creditor Parties under the Finance Documents;
and
|
|
(b)
|
copies
of the Approved Managers’ Document of Compliance and of the Ship Safety
Management Certificate (together with any other details of the applicable
safety management system which the Agent
requires).
|
|
4
|
A
valuation of each Ship then the subject of a Mortgage and the Ship the
subject of the said Final Sub-Advance addressed to the Agent and the
Lenders stated to be for the purpose of this Agreement and dated not
earlier then 30 days before the relevant Drawdown Date from an independent
London sale and purchase shipbroker which the Agent has approved or
appointed which shows a value for such Ships acceptable to the
Agent.
|
|
5
|
A
letter from the relevant Borrower to the protection and indemnity
association in which the Ship is or is to be entered instructing it to
provide the Agent with a copy of the certificate of entry of the Ship and
any information relating to the entry of the Ship in such protection and
indemnity association.
|
|
6
|
Favourable
legal opinions from lawyers appointed by the Agent on such matters
concerning the law of Xxxxxxxx Islands, Panama, China and such other
relevant jurisdictions as the Agent may
require.
|
|
7
|
A
favourable opinion from an independent insurance consultant acceptable to
the Agent on such matters relating to the insurances for the Ship as the
Agent may require.
|
|
8
|
Documents
of the kind referred to in Schedule 3 Part A 2, 3 and 4 in relation to the
Bareboat Charterer, the Time Charterer, the Approved Managers, TBS Pacific
Liner and TBS Worldwide and their execution of the Finance Documents to
which they are a party.
|
|
9
|
If
the Agent so requires, in respect of any of the documents referred to
above, a certified English translation prepared by a translator approved
by the Agent.
|
SCHEDULE
4
TRANSFER
CERTIFICATE
The
Transferor and the Transferee accept exclusive responsibility for ensuring that
this Certificate and the transaction to which it relates comply with all legal
and regulatory requirements applicable to them respectively.
|
To:
|
The
Royal Bank of Scotland plc for itself and for and on behalf of the
Borrowers, each Security Party, the Security Trustee and each Lender, as
defined in the Loan Agreement referred to
below.
|
[l]
|
1
|
This
Certificate relates to a Loan Agreement (the “Loan Agreement”) dated
as of 29 March 2007 and made between (1) Argyle Maritime Corp., Xxxxx
Maritime Corp., Dorchester Maritime Corp., Longwoods Maritime Corp.,
XxXxxxx Maritime Corp. and Sunswyck Maritime Corp. (the “Borrowers”), (2) the
banks and financial institutions named therein as Lenders and (3) The
Royal Bank of Scotland plc as Mandated Lead Arranger, Bookrunner, Agent,
Swap Bank, Security Trustee relating to a term loan facility of
$150,000,000.
|
|
2
|
In
this Certificate, terms defined in the Loan Agreement shall, unless the
contrary intention appears, have the same meanings
and:
|
|
|
“Relevant Parties” means
the Agent, the Borrowers, each Security Party, the Security Trustee and
each Lender;
|
“Transferor” means [full name]
of [lending office]; and
“Transferee” means [full name]
of [lending office].
|
3
|
The
effective date of this Certificate is [l] Provided that this
Certificate shall not come into effect unless it is signed by the Agent on
or before that date.
|
|
4
|
The
Transferor assigns to the Transferee absolutely all rights and interests
(present, future or contingent) which the Transferor has as Lender under
or by virtue of the Loan Agreement and every other Finance Document in
relation to [l] per cent. of its
Contribution, which percentage represents $[l].
|
|
5
|
By
virtue of this Certificate and Clause 26 of
the Loan Agreement, the Transferor is discharged entirely from its
Commitment which amounts to $[l] [from [l] per cent. of its
Commitment, which percentage represents $[l] and the
Transferee acquires a Commitment of $[l].
|
|
6
|
The
Transferee undertakes with the Transferor and each of the Relevant Parties
that the Transferee will observe and perform all the obligations under the
Finance Documents which Clause 26 of the Loan
Agreement provides will become binding on it upon this Certificate taking
effect.
|
|
7
|
The
Agent, at the request of the Transferee (which request is hereby made)
accepts, for the Agent itself and for and on behalf of every other
Relevant Party, this Certificate as a Transfer Certificate taking effect
in accordance with Clause 26 of the Loan
Agreement.
|
|
8
|
The
Transferor:
|
|
(a)
|
warrants
to the Transferee and each Relevant Party
that:
|
|
(i)
|
the
Transferor has full capacity to enter into this transaction and has taken
all corporate action and obtained all consents which are in connection
with this transaction; and
|
|
(ii)
|
this
Certificate is valid and binding as regards the
Transferor;
|
|
(b)
|
warrants
to the Transferee that the Transferor is absolutely entitled, free of
encumbrances, to all the rights and interests covered by the assignment in
paragraph 4 above; and
|
|
(c)
|
undertakes
with the Transferee that the Transferor will, at its own expense, execute
any documents which the Transferee reasonably requests for perfecting in
any relevant jurisdiction the Transferee’s title under this Certificate or
for a similar purpose.
|
|
9
|
The
Transferee:
|
|
(a)
|
confirms
that it has received a copy of the Loan Agreement and each of the other
Finance Documents;
|
|
(b)
|
agrees
that it will have no rights of recourse on any ground against either the
Transferor, the Agent, the Security Trustee or any Lender in the event
that:
|
|
(i)
|
any
of the Finance Documents prove to be invalid or
ineffective;
|
|
(ii)
|
any
Borrower or any Security Party fails to observe or perform its
obligations, or to discharge its liabilities, under any of the Finance
Documents;
|
|
(iii)
|
it
proves impossible to realise any asset covered by a Security Interest
created by a Finance Document, or the proceeds of such assets are
insufficient to discharge the liabilities of the Borrowers or any Security
Party under the Finance Documents;
|
|
(c)
|
agrees
that it will have no rights of recourse on any ground against the Agent,
the Security Trustee or any Lender in the event that this Certificate
proves to be invalid or
ineffective;
|
|
(d)
|
warrants
to the Transferor and each Relevant Party
that:
|
|
(i)
|
it
has full capacity to enter into this transaction and has taken all
corporate action and obtained all consents which it needs to take or
obtain in connection with this transaction;
and
|
|
(ii)
|
this
Certificate is valid and binding as regards the Transferee;
and
|
|
(e)
|
confirms
the accuracy of the administrative details set out below regarding the
Transferee.
|
|
10
|
The
Transferor and the Transferee each undertake with the Agent and the
Security Trustee severally, on demand, fully to indemnify the Agent and/or
the Security Trustee in respect of any claim, proceeding, liability or
expense (including all legal expenses) which they or either of them may
incur in connection with this Certificate or any matter arising out of it,
except such as are shown to have been mainly and directly caused by the
gross and culpable negligence or dishonesty of the Agent’s or the Security
Trustee’s own officers or
employees.
|
|
11
|
The
Transferee shall repay to the Transferor on demand so much of any sum paid
by the Transferor under paragraph 10 as exceeds one-half of the amount
demanded by the Agent or the Security Trustee in respect of a claim,
proceeding, liability or expense which was not reasonably foreseeable at
the date of this Certificate; but nothing in this paragraph shall affect
the liability of each of the Transferor and the Transferee to the Agent or
the Security Trustee for the full amount demanded by
it.
|
[Name of
Transferor] [Name
of Transferee]
By: By:
Date: Date:
Agent
Signed
for itself and for and on behalf of itself
as Agent
and for every other Relevant Party
[Name of
Agent]
By:
Date:
Administrative
Details of Transferee
Name of
Transferee:
Lending
Office:
Contact
Person
(Loan
Administration Department):
Telephone:
Telex:
Fax:
Contact
Person
(Credit
Administration Department):
Telephone:
Telex:
Fax:
Account
for payments:
Note: This
Transfer Certificate alone may not be sufficient to transfer a proportionate
share of the Transferor’s interest in the security constituted by the Finance
Documents in the Transferor’s or Transferee’s jurisdiction. It is the
responsibility of each Lender to ascertain whether any other documents are
required for this purpose.
SCHEDULE
5
REPAYMENT
INSTALMENTS
Loan
A
Loan A
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan A as at the Final Repayment Date, the first such instalment
falling due on the Drawdown Date in respect of the Loan A Delivery Advance, the
second instalment falling due on the date falling 6 months after the Drawdown
Date in respect of the Loan A Delivery Advance and subsequent instalments
falling due at 3 month intervals thereafter and the balloon instalment falling
due on the Final Repayment Date. The Agent shall on the Delivery Date
in respect of Ship A deliver to the Borrowers and the Creditor Parties a revised
repayment schedule setting out the dates on which each instalment is due and the
amount of each such instalment.
Loan
B
Loan B
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan B as at the Final Repayment Date, the first such instalment
falling due three months from the Drawdown Date in respect of the Loan B
Delivery Advance and subsequent instalments falling due at 3 month intervals
thereafter and the balloon instalment falling due on the Final Repayment
Date. The Agent shall on the Delivery Date in respect of Ship B
deliver to the Borrowers and the Creditor Parties a revised repayment schedule
setting out the dates on which each instalment is due and the amount of each
such instalment.
Loan
C
Loan C
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan C as at the Final Repayment Date, the first such instalment
falling due three months from the Drawdown Date in respect of the Loan C
Delivery Advance and subsequent instalments falling due at 3 month intervals
thereafter and the balloon instalment falling due on the Final Repayment
Date. The Agent shall on the Delivery Date in respect of Ship C
deliver to the Borrowers and the Creditor Parties a revised repayment schedule
setting out the dates on which each instalment is due and the amount of each
such instalment.
Loan
D
Loan D
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan D as at the Final Repayment Date, the first such instalment
falling due three months from the Drawdown Date in respect of the Loan D
Delivery Advance and subsequent instalments falling due at 3 month intervals
thereafter and the balloon instalment falling due on the Final Repayment
Date. The Agent shall on the Delivery Date in respect of Ship D
deliver to the Borrowers and the Creditor Parties a revised repayment schedule
setting out the dates on which each instalment is due and the amount of each
such instalment.
Loan
E
Loan E
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan E as at the Final Repayment Date, the first such instalment
falling due three months from the Drawdown Date in respect of the Loan E
Delivery Advance and subsequent instalments falling due at 3 month intervals
thereafter and the balloon instalment falling due on the Final Repayment
Date. The Agent shall on the Delivery Date in respect of Ship E
deliver to the Borrowers and the Creditor Parties a revised repayment schedule
setting out the dates on which each instalment is due and the amount of each
such instalment.
Loan
F
Loan F
will be repaid by quarterly instalments each in an amount equal to $417,500
together with a balloon instalment in amount equal to such amount outstanding in
respect of Loan F as at the Final Repayment Date, the first such instalment
falling due three months from the Drawdown Date in respect of the Loan F
Delivery Advance and subsequent instalments falling due at 3 month intervals
thereafter and the balloon instalment falling due on the Final Repayment
Date. The Agent shall on the Delivery Date in respect of Ship F
deliver to the Borrowers and the Creditor Parties a revised repayment schedule
setting out the dates on which each instalment is due and the amount of each
such instalment.
SCHEDULE
6
MANDATORY
COST FORMULA
|
1
|
The
Mandatory Cost is an addition to the interest rate to compensate Lenders
for the cost of compliance with (a) the requirements of the Financial
Services Authority (or any other authority which replaces all or any of
its functions) or (b) the requirements of the European Central
Bank.
|
|
2
|
On
the first day of each Interest Period (or as soon as possible thereafter)
the Agent shall calculate, as a percentage rate, a rate (the “Additional Cost Rate”)
for each Lender, in accordance with the paragraphs set out
below. The Mandatory Cost will be calculated by the Agent as a
weighted average of the Lenders’ Additional Cost Rates (weighted in
proportion to the percentage participation of each Lender in the relevant
Advance) and will be expressed as a percentage rate per
annum.
|
|
3
|
The
Additional Cost Rate for any Lender lending from a lending office in
Participating Member State will be the percentage notified by that Lender
to the Agent. This percentage will be certified by that Lender
in its notice to the Agent to be its reasonable determination of the cost
(expressed as a percentage of that Xxxxxx’s participation in all Advances
made from that lending office) of complying with the minimum reserve
requirements of the European Central Bank in respect of loans made from
that lending office.
|
|
4
|
The
Additional Cost Rate for any Lender lending from a lending office in the
United Kingdom will be calculated by the Agent as
follows:
|
[Missing
Graphic Reference]per cent. per annum
Where:
|
|
E
|
is
designed to compensate Lenders for amounts payable under the Fees Rules
and is calculated by the Agent as being the average of the most recent
rates of charge supplied by the Reference Banks to the Agent pursuant to
paragraph 6 below and expressed in pounds per
£1,000,000.
|
|
5
|
For
the purposes of this Schedule:
|
|
(a)
|
“Eligible Liabilities”
and “Special
Deposits” have the meanings given to them from time to time under
or pursuant to the Bank of England Act 1998 or (as may be appropriate) by
the Bank of England;
|
|
(b)
|
“Fees
Rules” means the rules on periodic fees contained in the
FSA Supervision Manual or such other law or regulation as may be in force
from time to time in respect of the payment of fees for the acceptance of
deposits;
|
|
(c)
|
“Fee
Tariffs” means the fee tariffs specified in the Fees
Rules under the activity group A.1 Deposit acceptors (ignoring any minimum
fee or zero rated fee required pursuant to the Fees Rules but taking into
account any applicable discount
rate);
|
|
(d)
|
“Participating Member
State” means any member state of the European Union that
adopts or has adopted the euro as its lawful currency in accordance with
legislation of the European Union relating to European Monetary Union;
and
|
|
(e)
|
“Tariff
Base” has the meaning given to it in, and will be
calculated in accordance with, the Fees
Rules.
|
|
6
|
If
requested by the Agent, each Reference Bank shall, as soon as practicable
after publication by the Financial Services Authority, supply to the
Agent, the rate of charge payable by that Reference Bank to the Financial
Services Authority pursuant to the Fees Rules in respect of the relevant
financial year of the Financial Services Authority (calculated for this
purpose by that Reference Bank as being the average of the Fee Tariffs
applicable to that Reference Bank for that financial year) and expressed
in pounds per £1,000,000 of the Tariff Base of that Reference
Bank.
|
|
7
|
Each
Lender shall supply any information required by the Agent for the purpose
of calculating its Additional Cost Rate. In particular, but
without limitation, each Lender shall supply the following information in
writing on or prior to the date on which it becomes a
Lender:
|
|
(a)
|
the
jurisdiction of its lending office;
and
|
|
(b)
|
any
other information that the Agent may reasonably require for such
purpose.
|
Each
Lender shall promptly notify the Agent in writing of any change to the
information provided by it pursuant to this paragraph.
|
8
|
The
rates of charge of each Reference Bank for the purpose of E above shall be
determined by the Agent based upon the information supplied to it pursuant
to paragraph 6 above and on the assumption that, unless a Lender notifies
the Agent to the contrary, each Lender’s obligations in relation to cash
ratio deposits and special Deposits are the same as those of a typical
bank from its jurisdiction of incorporation with a lending office in the
same jurisdiction as its lending
office.
|
|
9
|
The
Agent shall have no liability to any person if such determination results
in an Additional Cost Rate which over or under compensates any Lender and
shall be entitled to assume that the information provided by any Lender or
Reference Bank pursuant to paragraphs 3, 6 and 7 above is true and correct
in all respects.
|
|
10
|
The
Agent shall distribute the additional amounts received as a result of the
Mandatory Cost to the Lenders on the basis of the Additional Cost Rate for
each Lender based on the information provided by each Lender and each
Reference Bank pursuant to paragraphs 3, 6 and 7
above.
|
|
11
|
Any
determination by the Agent pursuant to this Schedule in relation to a
formula, the Mandatory Cost, an Additional Cost Rate or any amount payable
to a Lender shall, in the absence of manifest error, be conclusive and
binding on all parties.
|
|
12
|
The
Agent may from time to time, after consultation with the Borrowers and the
Lenders, determine and notify to all parties any amendments which are
required to be made to this Schedule in order to comply
with any change in law, regulation or any requirements from
time to time imposed by the Financial Services Authority or the European
Central Bank (or, in any case, any other authority which replaces all or
any of its functions) and any such determination shall, in the absence of
manifest error, be conclusive and binding on all
parties.
|
SCHEDULE
7
CLASSIFICATION
OF SHIPS
|
Ship
|
Classification
|
|
Ship
A
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
|
Ship
B
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
|
Ship
C
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
|
Ship
D
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
|
Ship
E
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
|
Ship
F
|
LR
& 100A7, Strengthened for Heavy Cargos, Container Cargoes on Twin Deck
and on Upper Deck and all hatch covers, & LMC, SCM. & IWS,
UMS
|
SCHEDULE 8
FINANCIAL
COVENANTS
Pursuant
to Clause 11.18 of this Agreement the Borrowers undertake that at all times they
shall not:
|
(a)
|
Minimum Cash
Liquidity. For each calendar month ending on or after
the date hereof, permit Qualified Cash of the Security Parties to be less
than $15,000,000 at any time during such calendar month provided that the
Borrowers shall ensure that at least $5,000,000 (excluding any restricted
cash) is deposited with the Agent at all times in any such calendar
month.
|
|
(b)
|
Maximum Consolidated Leverage
Ratio. Permit the Consolidated Leverage Ratio as of the
end of any fiscal quarter set forth below and for the period of four
fiscal quarters then ending of Holdings and its Subsidiaries to be greater
than the ratio set forth below opposite such time
period:
|
|
Four
Fiscal Quarter Ending:
|
Maximum
Consolidated Leverage Ratio
|
|
30
June 2010
|
5.00:1.00
|
|
30
September 2010
|
3.75:1.00
|
|
31
December 2010
|
3.00:1.00
|
|
31
March 2011
|
3.00:1.00
|
|
30
June 2011
|
2.75:1.00
|
|
30
September 2011 and thereafter
|
2.50:1.00
|
|
(c)
|
Minimum Consolidated Fixed
Charge Coverage Ratio. Permit the Consolidated Fixed
Charge Coverage Ratio as of the end of any fiscal quarter set forth below
and for the period of four fiscal quarters then ending of Holdings and its
Subsidiaries to be less than the ratio set forth below opposite such time
period:
|
|
Four
Fiscal Quarter Ending:
|
Minimum
Consolidated Fixed Charge Coverage Ratio
|
|
31
December 2010
|
1.10:1.00
|
|
31
March 2011
|
1.30:1.00
|
|
30
June 2011
|
1.50:1.00
|
|
30
September 2011 and thereafter
|
1.75:1.00
|
|
(d)
|
Minimum Consolidated Interest
Charges Coverage Ratio. Permit the Consolidated Interest
Charges Coverage Ratio as of the end of any fiscal quarter set forth below
and for the period of four fiscal quarters then ending of Holdings and its
Subsidiaries to be less than the ratio set forth below opposite such time
period:
|
|
Four
Fiscal Quarter Ending:
|
Minimum
Consolidated Interest Charges Coverage Ratio
|
|
31
March 2010
|
2.50:1.00
|
|
30
June 2010
|
3.00:1.00
|
|
30
September 2010
|
3.75:1.00
|
For the
avoidance of doubt the Consolidated Interest Charges Coverage Ratio will not be
measured for any fiscal quarter ending after 30 September 2010.
For the
purposes of this Schedule 8 the following terms shall have the following
meanings.
“Attributable
Indebtedness” means, on any date, (a) in respect of any
Capitalised Lease of any Person, the capitalised amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, (b) in respect of any Synthetic Lease Obligation, the capitalised
amount of the remaining lease or similar payments under the relevant lease or
other applicable agreement or instrument that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease or
other agreement or instrument were accounted for as a Capitalised Lease and (c)
all Synthetic Debt of such Person;
“Availability” means
the amount available for drawing under the Bank of America
Facilities;
“Capitalised
Leases” means all leases that have been or should be, in
accordance with GAAP, recorded as capitalised leases;
“Cash
Equivalents” means any of the following types of Investments,
to the extent owned by Holdings or any of their Subsidiaries free and clear of
all Security Interests (other than (i) a Security Interest in favour of the Bank
of America, N.A. in respect of the obligations arising under the Bank of America
Facilities and/or (ii) Permitted Security Interests):
|
(a)
|
readily
marketable obligations issued or directly and fully guaranteed or insured
by the United States of America or any agency or instrumentality thereof
having maturities of not more than 360 days from the date of acquisition
thereof; provided that the full faith and credit of the United States of
America is pledged in support
thereof;
|
|
(b)
|
time
deposits with, or insured certificates of deposit or bankers’ acceptances
of, any commercial bank that (i) (A) is a Lender or (B) is organised under
the laws of the United States of America, any state thereof or the
District of Columbia or is the principal banking subsidiary of a bank
holding company organised under the laws of the United States of America,
any state thereof or the District of Columbia, and is a member of the
Federal Reserve System, (ii) issues (or the parent of which issues)
commercial paper rated as described in Clause (c) of this definition and
(iii) has combined capital and surplus of at least $1,000,000,000, in each
case with maturities of not more than 90 days from the date of acquisition
thereof;
|
|
(c)
|
commercial
paper issued by any Person organised under the laws of any state of the
United States of America and rated at least “Prime-1” (or the then
equivalent grade) by Xxxxx’x or at least “A-1” (or the then equivalent
grade) by S&P, in each case with maturities of not more than 180 days
from the date of acquisition thereof;
and
|
|
(d)
|
Investments,
classified in accordance with GAAP as current assets of the Borrowers or
any of their Subsidiaries, in money market investment programs registered
under the Investment Company Act of 1940, which are administered by
financial institutions that have the highest rating obtainable from either
Xxxxx’x or S&P, and the portfolios of which are limited solely to
Investments of the character, quality and maturity described in Clauses
(a), (b) and (c) of this
definition;
|
“Consolidated
EBITDA” means, at any date
of determination, an amount equal to
Consolidated Net Income of Holdings and its Subsidiaries on a consolidated basis
for the most recently completed Measurement Period , plus (a) the following to the extent deducted
in calculating such Consolidated Net Income (and without duplication ): (i)
Consolidated Interest Charges, (ii) the provision for Federal, state, local and
foreign income taxes payable, (iii) depreciation and amortization expense , (iv) net losses from the sales of
vessels as permitted under this
Agreement, (v) any noncash
impairment charges incurred during each fiscal year of Holdings and its
Subsidiaries ending December 31, 2008, December 31, 2009, December 31, 2010 and
December 31, 2011 in respect of any of Holdings' or its Subsidiaries ' goodwill
and Vessels (in each case
of or by Holdings and its Subsidiaries for such Measurement Period), (vi) costs incurred during such
Measurement Period in connection with the redomicilation of Holdings in an
aggregate amount not to exceed $3,000,000 for all Measurement Periods , and
(vii) any non-cash compensation in the form of Equity Interests or other equity
awards made to employees of Holdings and its Subsidiaries in the fiscal years of
Holdings and its Subsidiaries ending December 31, 2010 and December 31, 2011 in
an aggregate amount not to exceed $ 10,000,000 in each such fiscal year (in each
case of or by Holdings and its Subsidiaries for such Measurement Period),
and minus (b) the following to the extent included
in calculating such Consolidated Net Income: all net gains from the sales of
vessels as permitted under this Agreement (in
each case of or by Holdings and its Subsidiaries for such Measurement Period );
provided that, to the
extent characterized as interest on the income statements of Holdings and its
Subsidiaries for such Measurement Period pursuant to FASB Interpretation No. 133
- Accounting for Derivative Instruments and Hedging Activities (June 1998),
non-cash adjustments in connection with any interest rate Swap Contract entered
into by Holdings or any of its Subsidiaries, shall be
excluded;
“Consolidated Fixed Charge Coverage
Ratio” means, at any date of determination, the ratio
of:
|
(a)
|
the
result of (i) Consolidated EBITDA, less (ii) the sum of (x) federal,
state, local and foreign income taxes paid in cash and (y) Restricted
Payments made, in each case, for the most recently completed Measurement
Period, to
|
|
(b)
|
the
sum of (i) Consolidated Interest Charges for the most recently completed
Measurement Period, (ii) the aggregate principal amount of all regularly
scheduled principal payments or redemptions or similar acquisitions for
value of outstanding debt for borrowed money for the period of twelve (12)
consecutive months following such date of determination, but excluding any
principal payments to be made in respect of the Revolving Credit Facility
(as defined in the Bank of America
Facilities);
|
“Consolidated Funded
Indebtedness” means, as of any date of determination, for
Holdings and its Subsidiaries on a consolidated basis, the sum of:
|
(e)
|
the
outstanding principal amount of all obligations, whether current or
long-term, for borrowed money (including Obligations under and as defined
in the Bank of America Facilities) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar
instruments;
|
|
(f)
|
all
purchase money Indebtedness;
|
|
(g)
|
all
direct obligations arising under letters of credit (including standby and
commercial), bankers’ acceptances, bank guaranties, surety bonds and
similar instruments;
|
|
(h)
|
all
obligations in respect of the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of
business);
|
|
(i)
|
all
Attributable Indebtedness;
|
|
(j)
|
without
duplication, all Guarantees with respect to outstanding Indebtedness of
the types specified in Clauses (a) through (e) above of Persons other than
the Borrowers or any Subsidiary;
and
|
|
(k)
|
all
Indebtedness of the types referred to in Clauses (a) through (f) above of
any partnership or joint venture (other than a joint venture that is
itself a corporation or limited liability company) in which a Borrower or
a Subsidiary is a general partner or joint venturer, unless such
Indebtedness is expressly made non-recourse to such Borrower or such
Subsidiary;
|
“Consolidated Interest Charges”
means, for any Measurement Period, the sum of (a) all interest, premium
payments, debt discount, fees, charges and related expenses in connection with
borrowed money (including capitalized interest but excluding capitalized
interest on Permitted New Vessel Construction Indebtedness) or in connection
with the deferred purchase price of assets, in each case to the extent treated
as interest in accordance with GAAP, (b) all interest paid or payable with
respect to discontinued operations and (c) the portion of rent expense under
Capitalized Leases that is treated as interest in accordance with GAAP, in each
case, of or by Holdings and its Subsidiaries on a consolidated basis for the
most recently completed Measurement Period; provided that, to the extent
characterized as interest on the income statements of Holdings and its
Subsidiaries for such Measurement Period pursuant to FASB Interpretation No. 133
– Accounting for Derivative Instruments and Hedging Activities (June 1998),
noncash adjustments in connection with any interest rate Swap Contract entered
into by Holdings or any of its Subsidiaries, shall be excluded;
“Consolidated Interest Charges
Coverage Ratio” means, at any date of determination, the ratio of (a) the
result of (i) Consolidated EBITDA less (ii) the sums of Federal, State, local
and foreign income taxes paid in cash for the most recently completed
Measurement Period to (b) Consolidated Interest Charges for the most recently
completed Measurement Period;
Consolidated Leverage Ratio”
means, as of any date of determination, the ratio of:
|
(a)
|
Consolidated
Funded Indebtedness as of such date
to:
|
|
(b)
|
Consolidated
EBITDA of Holdings and its Subsidiaries on a consolidated basis for the
most recently completed Measurement
Period;
|
“Consolidated Net
Income” means, at any date of determination, the net income
(or loss) of Holdings and its Subsidiaries on a consolidated basis for the most
recently completed Measurement Period; provided that Consolidated Net Income
shall exclude:
|
(a)
|
extraordinary
gains and extraordinary losses for such Measurement
Period;
|
|
(b)
|
the
net income of any Subsidiary during such Measurement Period to the extent
that the declaration or payment of dividends or similar distributions by
such Subsidiary of such income is not permitted by operation of the terms
of its Organisation Documents or any agreement, instrument or law
applicable to such Subsidiary during such Measurement Period, except that
Holdings’ equity in any net loss of any such Subsidiary for
such-Measurement Period shall be included in determining Consolidated Net
Income; and
|
|
(c)
|
any
income (or loss) for such Measurement Period of any Person if such Person
is not a Subsidiary, except that Holdings’ equity in the net income of any
such Person for such Measurement Period shall be included in Consolidated
Net Income up to the aggregate amount of cash actually distributed by such
Person during such Period to Holdings or a Subsidiary as a dividend or
other distribution (and in the case of a dividend or other distribution to
a Subsidiary, such Subsidiary is not precluded from further distributing
such amount to Holdings as described in Clause (b) of this
proviso);
|
“Debtor Relief
Laws” means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganisation,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally;
“Equity
Interests” means, with respect to any Person, all of the
shares of capital stock of (or other ownership or profit interests in) such
Person, all of the warrants, options or other rights for the purchase of
acquisition from such Person of shares of capital stock of (or ownership or
profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) such Person or warrants, rights or options for the purchase or
acquisition from such Person of such shares (or such other interests), and all
of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting,
and whether or not such shares, warrants, options, rights or other interests are
outstanding on any date of determination;
“GAAP” means
generally accepted accounting principles in the United States set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles as may be
approved by a significant segment of the accounting profession in the United
States, that are applicable to the circumstances as of the date of
determination, consistently applied;
“Guarantee” means,
as to any Person:
|
(a)
|
any
obligation, contingent or otherwise, of such Person guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation
payable or performable by another Person (the “primary obligor”) in any
manner, whether directly or indirectly, and including any obligation of
such Person, direct or indirect,_ (i) to purchase or pay (or advance or
supply funds the purchase or payment of) such Indebtedness or other
obligation, (ii) to purchase or lease property, securities or services for
the purpose of assuring the obligee in respect of such Indebtedness or
other obligation of the payment or performance of such Indebtedness or
other obligation, (iii) to maintain working capital, equity capital or any
other financial statement condition or liquidity or level of income or
cash flow of the primary obligor so as to enable the primary obligor to
pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or
to protect such obligee against loss in respect thereof (in whole or in
part), or
|
|
(b)
|
any
Security Interest on any assets of such Person securing any Indebtedness
or other obligation of any other Person, whether or not such Indebtedness
or other obligation is assumed by such Person (or any right, contingent or
otherwise, of any holder of such Indebtedness to obtain any such Security
Interest). The amount of any Guarantee shall be deemed to be an
amount equal to the stated or determinable amount of the related primary
obligation, or portion thereof, in respect of which such Guarantee is made
or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in
good faith. The term “Guarantee” as a verb has
a corresponding meaning;
|
“Holdings” means the
New Corporate Guarantor;
“Indebtedness” means,
as to any Person at a particular time, without duplication, all of the
following, whether or not included as indebtedness or liabilities in accordance
with GAAP:
|
(a)
|
all
obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;
|
|
(b)
|
the
maximum amount of all direct or contingent obligations of such Person
arising under letters of credit (including standby and commercial),
bankers’ acceptances, bank guaranties, surety bonds and similar
instruments;
|
|
(c)
|
net
obligations of such Person under any Swap
Contract;
|
|
(d)
|
all
obligations of such Person to pay the deferred purchase price of property
or services (other than trade accounts payable in the ordinary course of
business and not past due for more than 60 days after the date on which
such trade account was created);
|
|
(e)
|
indebtedness
(excluding prepaid interest thereon) secured by a Security Interest on
property owned or being purchased by such Person (including indebtedness
arising under conditional sales or other title retention agreements),
whether or not such indebtedness shall have been assumed by such Person or
is limited in recourse;
|
|
(f)
|
all
Attributable Indebtedness in respect of Capitalised Lease and Synthetic
Lease Obligations of such Person and all Synthetic Debt of such
Person;
|
|
(g)
|
all
obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Equity Interest in such
Person or any other Person or any warrant, right or option to acquire such
Equity Interest, valued, in the case of a redeemable preferred interest,
at the greater of its voluntary or involuntary liquidation preference plus
accrued and unpaid dividends; and
|
|
(h)
|
all
Guarantees of such Person in respect of any of the
foregoing.
|
For all
purposes hereof, the Indebtedness of any Person shall include the Indebtedness
of any partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which such Person is a general
partner or a joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person. The amount of any net obligation under
any Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date;
“Intangible
Assets” means assets that are considered to be intangible
assets under GAAP, including customer lists, goodwill, computer software,
copyrights, trade names, trademarks, patents, franchises, licenses, unamortised
deferred charges, unamortised debt discount and capitalised research and
development costs;
“Investment” means,
as to any Person, any direct or indirect acquisition or investment by such
Person, whether by means of:
|
(a)
|
the
purchase or other acquisition of Equity Interests of another
Person;
|
|
(b)
|
a
loan, advance or capital contribution to, Guarantee or assumption of debt
of, or purchase or other acquisition of any other debt or interest in,
another Person;
|
|
(c)
|
the
purchase or other acquisition (in one transaction or a series of
transactions) of assets of another Person that constitute a business unit
or all or a substantial part of the business of, such Person;
or
|
|
(d)
|
the
acquisition or construction of a vessel. For purposes of covenant
compliance, the amount of any Investment shall be the amount actually
invested, without adjustment for subsequent increases or decreases in the
value of such Investment;
|
“Measurement
Period” means, at any date of determination, the most recently
completed four fiscal quarters of Holdings;
“Moody’s” means
Xxxxx’x Investors Service Inc., and any successor thereto;
“Organisation
Documents” means:
|
(a)
|
with
respect to any corporation, the certificate or articles of incorporation
and the bylaws (or equivalent or comparable constitutive documents with
respect to any non-U.S.
jurisdiction);
|
|
(b)
|
with
respect to any limited liability company, the certificate or articles of
formation or organisation and operating agreement;
and
|
|
(c)
|
with
respect to any partnership, joint venture, trust or other form of business
entity, the partnership, joint venture or other applicable agreement of
formation or organisation and any agreement, instrument, filing or notice
with respect thereto filed in connection with its formation or
organisation with the applicable governmental authority in the
jurisdiction of its formation or organisation and, if applicable, any
certificate or articles of formation or organisation of such
entity;
|
“Permitted New Vessel Construction
Indebtedness” means Indebtedness incurred after the date when
all the conditions precedent in Section 4.01 of the Bank of America Credit
Facilities are satisfied or waived by Subsidiaries of Holdings that are not
borrowers or guarantors under the Bank of America Credit Facilities in
connection with the construction of up to twelve (12) multipurpose tweendecks or
bulkcarrier shipping vessels;
“Person” means any
natural person, corporation, limited liability company, trust, joint venture,
association, company, partnership, governmental authority or other
entity;
“Qualified
Cash” means, as of any date of determination, the amount of
cash and Cash Equivalents which is freely transferable and not subject to a
Security Interest (other than (i) a Security Interest in favour of the Bank of
America, N.A. in respect of the obligations arising under the Bank of America
Facilities and/or (ii) a Permitted Security Interest) pledge, security interest,
encumbrance, escrow or cash collateral arrangement or any other restriction on
its use;
“Restricted
Payment” means any dividend or other distribution (whether in
cash, securities or other property) with respect to any capital stock or other
Equity Interest of any Person or any of its Subsidiaries, or any payment
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such capital stock or other
Equity Interest, or on account of any return of capital to any Person’s
stockholders, partners or members (or the equivalent of any thereof), or any
option, warrant or other right to acquire any such dividend or other
distribution or payment;
“Shareholders’
Equity” means, as of any date of determination, consolidated
shareholders’ equity of Holdings and its Subsidiaries as of that date determined
in accordance with GAAP;
“S&P” means
Standard & Poor’s Ratings Services, a division of the XxXxxx-Xxxx Companies
Inc., and any successor thereto;
“Subsidiary” of a
Person means a corporation, partnership, joint venture, limited liability
company or other business entity of which a majority of the shares of securities
or other interests having ordinary voting power for the election of directors or
other governing body (other than securities or interests having such power only
by reason of the happening of a contingency) are at the time beneficially owned,
or the management of which is otherwise controlled, directly, or indirectly
through one or more intermediaries, or both, by such Person. Unless
otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of Holdings;
“Swap
Contract” means:
|
(a)
|
any
and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity
options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond
or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot contracts,
or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing),
whether or not any such transaction is governed by or subject to any
master agreement; and
|
|
(b)
|
any
and all transactions of any kind, and the related confirmations, which are
subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives
Association, Inc., any International Foreign Exchange Master Agreement, or
any other master agreement (any such master agreement, together with any
related schedules, a “Master Agreement”), including any such obligations
or liabilities under any Master
Agreement;
|
“Swap Termination
Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts:
|
(a)
|
for
any date on or after the date such Swap Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s); and
|
|
(b)
|
for
any date prior to the date referenced in clause (a), the amount(s)
determined as the mark-to-market value(s) for such Swap Contracts, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognised dealer in such Swap
Contracts;
|
“Synthetic
Debt” means, with respect to any Person as of any date of
determination thereof, obligations of such Person in respect of transactions
entered into by such Person that are intended to function primarily as a
borrowing of funds (including any minority interest transactions that function
primarily as a borrowing) but are not otherwise included in the definition of
“Indebtedness” or as a liability on the consolidated balance sheet of such
Person and its Subsidiaries in accordance with GAAP.
“Synthetic Lease
Obligation” means the monetary obligation of a Person
under:
|
(a)
|
a
so-called synthetic, off-balance sheet or tax retention lease;
or
|
|
(b)
|
an
agreement for the use or possession of property (including sale and
leaseback transactions), in each case, creating obligations that do not
appear on the balance sheet of such Person but which, upon the application
of any Debtor Relief Laws to such Person, would be characterised as the
indebtedness of such Person (without regard to accounting
treatment).
|
SCHEDULE
9
FORM
OF COMPLIANCE CERTIFICATE
To: The
Royal Bank of Scotland plc
Shipping
Business Centre
0-00
Xxxxx Xxxxx Xxxxxx
London
EC3P 3HX
Attention: Ship
Finance Portfolio Management
From: TSB
International Public Limited Company
OFFICER’S
CERTIFICATE
This
Certificate is rendered pursuant to clause 11.18(i)
of the loan agreement dated as of 29 March 2007 (the “Loan Agreement”) and entered
into between (i) Argyle Maritime Corp., Xxxxx Maritime Corp., Dorchester
Maritime Corp., Longwoods Maritime Corp., XxXxxxx Maritime Corp. and Sunswyck
Maritime Corp., as joint and several Borrowers, (ii) the banks and financial
institutions listed in Schedule 1 as Lenders, (iii) The Royal Bank of Scotland
plc as Mandated Lead Arranger, Bookrunner, Agent, Security Trustee and Swap
Bank, relating to a loan facility of US$150,000,000. Words and
expressions defined in the Loan Agreement shall have the same meanings when used
herein.
I, the
Chief Financial Officer of the New Corporate Guarantor, hereby certify
that:
|
1
|
Attached
to this Certificate are the latest [audited][unaudited] accounts of the
Guarantor and its consolidated subsidiaries for the financial year
[quarter] ending on [l].
|
|
2
|
Set
out below are the respective amounts, in US Dollars, of Cash Equivalents,
Consolidated EBITDA, Consolidated Interest Charges, Consolidated Net
Income and Qualified Cash:
|
|
US
Dollars
|
|
|
Cash
Equivalents
|
[l]
|
|
Consolidated
EBITDA
|
[l]
|
|
Consolidated
Interest Charges
|
[l]
|
|
Consolidated
Net Income
|
[l]
|
|
Qualified
Cash
|
[l]
|
|
3
|
Accordingly,
as at the date of this Certificate the financial covenants set out in
Appendix 8 of the Loan Agreement [are][are not] complied with, in
that as at [l]:
|
|
(a)
|
Minimum
Cash
Liquidity US$[l];
|
|
(b)
|
Maximum
Consolidated Leverage
Ratio [x.xx]
|
|
(c)
|
Minimum
Consolidated Fixed Charge Coverage
Ratio [x.xx]
|
|
4
|
As
at [l] no
Event of Default has occurred and is continuing [or, specify / identify
any Event of Default]. The Borrowers are in compliance with
Clause 15.1 of the Loan
Agreement.
|
[If not,
specify this and what is proposed as regards Clause 15.2.]
APPENDIX
2
FORM
OF CORPORATE GUARANTEE SUPPLEMENTS
APPENDIX
3
FORM
OF MORTGAGE ADDENDUM
APPENDIX
4
FORM
OF SHARES SECURITY DEED
APPENDIX
5
FORM
OF RESTRICTED EQUITY DEPOSIT ACCOUNT SECURITY DEED
