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"Adjusted Fixed Charges"
|
shall mean for each four fiscal quarter period (taken as a single accounting period) for which a determination is being made, the sum of (i) Fixed Charges plus (ii) the average of the amount of Current Debt of OSG and the
Recourse Subsidiaries outstanding as of the end of each such fiscal quarter;
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"Administrative Questionnaire"
|
shall mean, with respect to each Bank, an administrative questionnaire substantially in the form of Exhibit A hereto, submitted to the Facility Agent (with a copy to the Borrowers) duly completed by such Bank;
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"Advance"
|
shall mean any amount advanced to the Borrowers pursuant to Section 2.1; provided that each such Advance shall be in a minimum amount of $10,000,000 or any larger multiple of $1,000,000;
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"Advance Time Charter Revenues"
|
shall mean, as of the date of any determination thereof, the amount at which advance time charter revenues of OSG and its Recourse Subsidiaries are properly included on the liability side of OSG's most recent consolidated balance sheet,
determined in accordance with GAAP, and if not listed as a separate line item on such balance sheet, such amounts as are described separately in the officer's certificates required pursuant to Section 8.1(d)(iii);
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"Affiliate"
|
shall mean, with respect to any Person, (i) any Person that directly, or indirectly through one or more intermediaries, Controls such Person (a "Controlling Person") or (ii) any Person (other than such Person or a
Subsidiary of such Person) which is Controlled by or is under common Control with a Controlling Person;
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"Agent(s)"
|
shall have the meaning ascribed thereto in the preamble;
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"Applicable Law"
|
shall mean any Law of any Authority, including, without limitation, all Federal and state banking or securities laws, to which the Person in question is subject or by which it or any of its material property is bound;
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"Applicable Margin"
|
shall mean a margin which will vary as set forth on Schedule II attached hereto based upon the rating levels assigned to OSG's senior unsecured debt (without third-party credit enhancement) by S&P and Xxxxx'x or, in the absence of
any ratings, based upon the ratio of Cash Adjusted Funded Debt to Consolidated EBITDA. The Applicable Margin for an Advance shall be determined by the Facility Agent at or about 10:00 a.m. (New York City time) two (2) Banking Days prior to the
Drawdown Date for such Advance and shall be promptly notified in writing to the Banks and the Borrowers, such determination of the Applicable Margin, absent manifest error, to be conclusive and binding upon the Borrowers;
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"Applicable Rate"
|
shall mean, in respect of any Advance, the rate of interest on such Advance from time to time applicable pursuant to Section 5.1;
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"Assignment and Assumption Agreement(s)"
|
shall mean the Assignment and Assumption Agreement(s) executed pursuant to Section 10.1 or 11.8 substantially in the form of Exhibit B;
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"Attributable Debt"
|
shall mean, as of the date of any determination thereof, in connection with any Sale and Leaseback Transaction which is not permitted pursuant to Section 8.2(d)(ii), the lesser of (i) the Fair Market Value of any vessels subject to
such transaction or the fair market value of any other non-vessel assets subject to such transaction or (ii) the present value (computed in accordance with GAAP at the imputed rate of interest used in such transaction) of the obligation of a lessee
in such transaction for Rentals during the remaining term of any lease (including any period for which such lease has been extended or may, at the option of the lessor, be extended);
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"Authority"
|
shall mean any governmental or quasi-governmental authority, whether executive, legislative, judicial, administrative or other, or any combination thereof, including, without limitation, any Federal, state, territorial, county,
municipal or other government or governmental or quasi-governmental agency, arbitrator, board, body, branch, bureau, commission, corporation, court, department, instrumentality, master, mediator, panel, referee, system or other political unit or
subdivision or other entity of any of the foregoing, whether domestic or foreign;
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"Bank(s)"
|
shall have the meaning ascribed thereto in the preamble;
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"Banking Day(s)"
|
shall mean day(s) on which banks are open for the transaction of business in London, England and New York, New York;
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"Book Value"
|
shall mean, as of the date of any determination thereof, the value at which the assets of OSG and the Recourse Subsidiaries are recorded and reported by OSG in its consolidated financial statements;
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"Borrower(s)"
|
shall have the meaning ascribed thereto in the preamble;
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"Capital Construction Funds"
|
shall mean as of the date of any determination thereof, the aggregate amount on deposit in capital construction funds established and maintained pursuant to agreement with the Secretary of Transportation in accordance with Section 1177
of the Merchant Xxxxxx Xxx, 0000, as amended, 46 U.S.C. Appx. Section 1177, for the account of OSG and the Recourse Subsidiaries;
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"Capitalized Lease"
|
shall mean any lease the obligation for Rentals with respect to which is required to be capitalized on a balance sheet of the lessee in accordance with GAAP;
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"Capitalized Rentals"
|
of any Person shall mean, as of the date of any determination thereof, the amount at which the aggregate Rentals due and to become due under all Capitalized Leases under which such Person is a lessee would be reflected as a liability on
the balance sheet of such Person;
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"Cash"
|
shall mean as of the date of any determination thereof, the total amount of all cash and Cash Equivalents as determined in accordance with GAAP of OSG and the Recourse Subsidiaries including, without limitation, cash of OSG and the
Recourse Subsidiaries included in Capital Construction Funds (net of any imputed taxes and penalties thereon, if any), interest-bearing deposits in banks or trust companies described in clause (c) of the definition of "Permitted Investments" with
maturities of less than one year held by OSG and the Recourse Subsidiaries as the same are reflected in a consolidated balance sheet of OSG and the Subsidiaries delivered in accordance with Section 8.1(d), and "Cash" shall also include, for the purposes
of the calculations of Cash Adjusted Consolidated Net Tangible Assets and Cash Adjusted Funded Debt required by Section 8.1(r) only, Cash of OSG and the Recourse Subsidiaries included in Restricted Funds;
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"Cash Adjusted Consolidated
Net Tangible Assets"
|
shall mean, as of the date of any determination thereof, Consolidated Net Tangible Assets less Cash;
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"Cash Adjusted Debt
Service Coverage Ratio"
|
shall mean, for each four fiscal quarter period (taken as a single accounting period) for which a determination is being made, the ratio of Cash Adjusted Income Available for Fixed Charges to Adjusted Fixed Charges;
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"Cash Adjusted Funded Debt"
|
shall mean, as of the date of any determination thereof, Consolidated Funded Debt less Cash;
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"Cash Adjusted Income Available for Fixed Charges"
|
shall mean, for any period, with respect to OSG and the Recourse Subsidiaries, the sum of (without duplication) (i) Net Income Available for Fixed Charges, (ii) depreciation and amortization of OSG and the Recourse
Subsidiaries determined on a consolidated basis in accordance with GAAP for such period, and (iii) 75% of the average of the amounts of Cash outstanding as of the end of each of the four quarterly periods included in the determination;
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"Cash Collateral"
|
shall have the meaning ascribed thereto in Section 8.1(s);
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"Cash Equivalents"
|
shall mean (i) securities issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof (provided that the full faith and credit of the United States of America is
pledged in support thereof), and (ii) time deposits, certificates of deposit or deposits in the interbank market of any commercial bank of recognized standing organized under the laws of the United States of America, any state thereof or any foreign
jurisdiction having capital and surplus in excess of $500,000,000, and rated at least A or the equivalent thereof by S&P in respect of both (i) and (ii) above, in each case having maturities of not more than ninety (90) days from the date of acquisition
;
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"Closing Date"
|
shall mean the date on which each of the conditions precedent to the availability of the Facility set forth in Section 3.1 shall have been met or waived;
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"Code"
|
shall mean the Internal Revenue Code of 1986, as amended, and any successor statute and regulations promulgated thereunder;
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"Collateral Date"
|
shall have the meaning ascribed thereto in Section 8.1(s);
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"Collateralized Assets"
|
shall mean any assets of OSG that are pledged or mortgaged as security for any type of financing (including Capitalized Leases);
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"Commitment"
|
shall mean, in relation to a Bank, the portion of the Facility set out opposite its name in Schedule I hereto or, as the case may be, in any relevant Assignment and Assumption Agreement, as changed from time to time pursuant to the
terms of this Agreement;
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"Commitment Fee"
|
shall have the meaning ascribed thereto in Section 12.1;
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"Compliance Certificate"
|
shall mean a certificate certifying the compliance by each of the Borrowers with all of its covenants contained herein and showing the calculations thereof in sufficient detail as to permit the verification thereof by the Facility
Agent, delivered by the chief financial officer of OSG to the Facility Agent with sufficient copies for the other Creditors to be distributed to the other Creditors by the Facility Agent promptly upon receipt thereof pursuant to Section 8.1(d)(i) and
(ii) in the form set out in Exhibit E, or in such other form as the Facility Agent may agree;
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"Consolidated EBITDA"
|
shall mean, for any period, with respect to OSG and the Recourse Subsidiaries, the sum of (without duplication) (i) Consolidated Net Income; (ii) all Interest Charges of OSG and the Recourse Subsidiaries; (iii) income taxes (other than
income taxes (either positive or negative) attributable to extraordinary and non-recurring gains or losses) of OSG and the Recourse Subsidiaries; and (iv) depreciation and amortization of OSG and the Recourse Subsidiaries determined on a consolidated
basis in accordance with GAAP for such period; provided that if any Recourse Subsidiary is not wholly-owned by OSG, Consolidated EBITDA shall be reduced (to the extent not otherwise reduced in accordance with GAAP) by an amount equal to (A) the amount of the Consolidated Net Income attributable
to such Recourse Subsidiary multiplied by (B) the percentage ownership interest in the income of such Recourse Subsidiary not owned on the last day of such period by OSG;
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"Consolidated Funded Debt"
|
shall mean all Funded Debt of OSG and the Recourse Subsidiaries, determined on a consolidated basis eliminating intercompany items;
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"Consolidated Net Income"
|
for any period shall mean consolidated net income of OSG and the Recourse Subsidiaries for such period, as shown on the consolidated financial statements of OSG and the Recourse Subsidiaries delivered in accordance with Section 8.1(d);
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"Consolidated Net Tangible Assets"
|
shall mean as of the date of any determination thereof the total amount of all Tangible Assets after excluding therefrom (i) all Restricted Investments (valued in accordance with GAAP) and (ii) any write-up of fixed assets of
OSG and the Recourse Subsidiaries other than write-ups in accordance with GAAP of assets of a business made after the acquisition of such business after December 31, 1999 and after deducting all liabilities except deferred income taxes, deferred credits,
Advance Time Charter Revenues, Minority Interests (if considered to be liabilities), Unterminated Voyage Revenues and Consolidated Funded Debt;
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"Consolidated Tangible Net Worth"
|
shall mean, as of the date of any determination thereof, the total of stockholders' equity (as shown on the most recent consolidated balance sheet of OSG and the Recourse Subsidiaries) less Intangible Assets of OSG and the Recourse
Subsidiaries;
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"Control"
|
shall mean, for purposes of the definition of "Affiliate," with respect to any Person, possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise (for purposes of the aforesaid definition, the term "Control" used as a verb has a corresponding meaning);
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|
"Conversion Date"
|
shall have the meaning ascribed thereto in Section 11.7(a);
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|
"Creditors"
|
shall mean, together, the Agents and the Banks, each, a "Creditor";
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|
"Current Debt"
|
of any Person shall mean as of the date of any determination thereof (i) the Current Portion, (ii) all other Debt of such Person other than Funded Debt and (iii) (without duplication) Guarantees by such Person of Debt of
the type described in clauses (i) and (ii);
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|
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"Current Portion"
|
with respect to any Person shall mean the portion (determined in accordance with GAAP) of long-term Debt of such Person shown as a current liability on the consolidated balance sheet of such Person;
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|
"Debt"
|
of any Person shall mean (i) all liabilities for money borrowed (excluding, in the case of OSG or any Recourse Subsidiary, Debt defined herein as Non-Recourse Debt) as determined in accordance with GAAP eliminating
intercompany items, (ii) (without duplication) all Capitalized Rentals of such Person (other than rentals owing from OSG or any Recourse Subsidiary to OSG or another Recourse Subsidiary), and (iii) (without duplication) all Guarantees by such
Person of Debt of Persons (other than, in the case of OSG or any Recourse Subsidiary, Debt of OSG or any Recourse Subsidiary);
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|
"Default"
|
shall mean any event that would, with the giving of notice or passage of time, or both, be an Event of Default;
|
|
|
"Default Rate"
|
shall have the meaning ascribed thereto in Section 5.1(b);
|
|
|
"Derivatives Obligations"
|
of any Person shall mean all obligations of such Person in respect of any rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond
option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option
with respect to any of the foregoing transactions) or any combination of the foregoing transactions;
|
|
|
"DOC"
|
shall mean a document of compliance issued to an Operator in accordance with rule 13 of the ISM Code;
|
|
|
"Documentation Agent"
|
shall have the meaning ascribed thereto in the preamble;
|
|
|
"Dollars" or "$"
|
shall mean the legal currency, at any relevant time hereunder, of the United States of America and, in relation to all payments hereunder, in same day funds settled through the New York Clearing House Interbank Payments System (or such
other Dollar funds as may be determined by the Facility Agent to be customary for the settlement in New York City of banking transactions of the type herein involved);
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|
|
"Drawdown Date"
|
shall mean any date, being a Banking Day, not later than the date falling one day prior to the Final Payment Date, upon which the Borrowers have requested that an Advance be made as provided in Section 2.1;
|
|
|
"Drawdown Notice"
|
shall have the meaning ascribed thereto in Section 2.2;
|
|
|
"Environmental Approvals"
|
shall have the meaning ascribed thereto in Section 7.1(h);
|
|
|
"Environmental Claim"
|
shall have the meaning ascribed thereto in Section 7.1(h);
|
|
|
"Environmental Laws"
|
shall have the meaning ascribed thereto in Section 7.1(h);
|
|
|
"ERISA"
|
shall mean the Employee Retirement Income Security Act of 1974, as amended;
|
|
|
"ERISA Affiliate"
|
shall mean a trade or business (whether or not incorporated) which is under common control with any Borrower within the meaning of Sections 414(b),(c),(m) or (o) of the Code;
|
|
|
"ERISA Group"
|
shall mean OSG and the Subsidiaries;
|
|
|
"Event(s) of Default"
|
shall mean any of the events set out in Section 9.1;
|
|
|
"Exchange Act"
|
shall mean the Securities Exchange Act of 1934, as amended;
|
|
|
"Existing Credit Facility"
|
shall mean the credit facility established pursuant to that certain Second Amended and Restated Credit Agreement in its entirety, dated as of August 19, 1997, among the Borrowers, the banks listed therein, The Chase Manhattan Bank, as
Syndication Agent, Citibank, N.A., as Administrative Agent, and Xxxxxx Guaranty Trust Company of New York, as Documentation Agent;
|
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"Facility"
|
the sum to be made available by the Banks to the Borrowers in the aggregate principal amount not to exceed Three Hundred Fifty Million Dollars ($350,000,000) pursuant to Section 2 hereof, as the same may be reduced from time to
time pursuant to Section 2.6 hereof;
|
|
|
"Facility Agent"
|
shall have the meaning ascribed thereto in the preamble;
|
|
|
"Facility Balance"
|
shall mean the Dollar amount of the Facility outstanding at any time;
|
|
|
"Facility Period"
|
shall mean the period from the date hereof to the date which is five (5) years from the date hereof;
|
|
|
"Fair Market Value"
|
shall mean, in respect of any vessel, the average of two sets of appraised values of such vessel as determined by two (2) of the brokers listed on Schedule IV, such vessel to be valued on a stand alone basis, free and clear of any
liens, charters or other encumbrances and with no value given to any pooling arrangements. One broker shall be selected by the Borrowers and one broker shall be selected by the Agents. No such appraisal shall be dated more than thirty (30) days prior to
the date on which such appraisal is required pursuant to this Agreement unless the Facility Agent consents in writing (on each occasion) to the use of an older appraisal;
|
|
|
"Federal Funds Rate"
|
shall mean, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers, as published for such day (or, if such day is not a day on which banks are open for the transaction of business in New York, for the next preceding day on which banks are open for the transaction of business in New York) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Banking Day, the average of the quotations for such day on such transactions received by the Facility Agent from three (3) Federal funds brokers of recognized
standing selected by the Facility Agent;
|
|
|
"Final Payment Date"
|
shall mean the date which falls on the fifth anniversary of the date of this Agreement or, if such day is not a Banking Day, the Final Payment Date shall be the immediately preceding Banking Day;
|
|
|
"Fixed Charges"
|
for any period shall mean on a consolidated basis the sum of (i) all Rentals (other than Capitalized Rentals) payable in respect of such period by OSG and the Recourse Subsidiaries, and (ii) all Interest Charges on all Indebtedness
(including the interest component of Capitalized Rentals) of OSG and the Recourse Subsidiaries;
|
|
|
"Funded Debt"
|
of any Person shall mean all Debt of such Person having a final maturity of more than one year from the date of origin thereof (or which is renewable or extendible at the option of the obligor for a period or periods more than one year
from the date of origin), excluding the Current Portion;
|
|
|
"GAAP"
|
shall mean generally accepted accounting principles at the time in the United States, except that (so long as the Statement of Financial Accounting Standards No. 94 (or any substantially similar successor statement) is in effect), with
respect to financial statements of OSG and the Recourse Subsidiaries, the failure to consolidate Non-Recourse Subsidiaries shall be deemed to be in accordance with such principles;
|
|
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"Guarantee"
|
by any Person shall mean, without duplication, any obligation (other than endorsements in the ordinary course of business of negotiable instruments for deposit or collection), contingent or otherwise, of such Person directly or
indirectly guaranteeing any Debt or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Debt or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep-well, to take-or-pay (or similar arrangements involving the purchase of goods, securities or services), or to
maintain financial statement conditions or otherwise); or (ii) entered into for the purpose of assuring in any other manner the obligee of such Debt or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided that the term "Guarantee" used as a verb has a corresponding meaning;
|
|
|
"Indebtedness"
|
of any Person shall mean and include all obligations of such Person which in accordance with GAAP shall be classified upon a balance sheet of such Person as liabilities of such Person, and in any event shall include all Debt of such
Person;
|
|
|
"Intangible Assets"
|
shall mean, as of the date of any determination thereof, goodwill, patents, trade names, trademarks, copyrights, franchises, experimental expenses, organization expenses, unamortized debt discount and expenses, deferred charges (other
than unamortized deferred drydock costs, unterminated voyage expenses, prepaid insurance, prepaid taxes, prepaid charterhire and other prepaid items properly excludable from intangible assets under GAAP), the excess of cost of shares acquired over fair
value of underlying tangible assets and such other assets as are properly classified as "intangible assets" in accordance with GAAP;
|
|
|
"Interest Charges"
|
for any period shall mean all interest (excluding only capitalized interest in connection with vessel construction prior to delivery thereof, which capitalized interest is not paid or payable and is included in Debt) and all
amortization of debt discount and expense on any particular Indebtedness for which such calculations are being made;
|
|
|
"Interest Period"
|
shall mean with respect to any Advance, (a) each period commencing on the date such Advance is made or the last day of the next preceding Interest Period with respect to such Advance and ending on the seventh (7th) day
thereafter (a "Seven Day Interest Period") or on the same day in the first, third, sixth or twelfth calendar month thereafter, in each case, as selected by the Borrowers or, (b) in the Facility Agent's discretion, such other period(s) not to exceed twelve
(12) months as may be agreed, or, (c) in the Banks' discretion, such other period(s) in excess of twelve (12) months as may be agreed, except, in each case, that each such Interest Period (if such Interest Period is a whole number of months) which
commences on the last Banking Day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last Banking Day of the appropriate subsequent calendar month. If at
the end of any then existing Interest Period the Borrowers fail to give notice of a selected Interest Period or an Event of Default shall have occurred and be continuing, the relevant Interest Period shall be one month or such other period as the Facility
Agent may select.
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|
|
|
Notwithstanding the foregoing, (i) no Interest Period may extend beyond the Final Payment Date; (ii) each Interest Period which would otherwise end on a day which is not a Banking Day shall end on the next succeeding Banking
Day (or, if such next succeeding Banking Day falls in the next succeeding calendar month, on the next preceding Banking Day); and (iii) each Interest Period which would otherwise commence before and end after the Final Payment Date shall end on the
Final Payment Date;
|
|
|
"Investments"
|
shall mean all investments, in cash or by delivery of property made, directly or indirectly in any Person, whether by acquisition of shares of capital stock, indebtedness or other obligations or Securities or by loan, advance, capital
contribution or otherwise; provided, however, that "Investments" shall not mean or include routine investments in property to be used or consumed in the ordinary course of business;
|
|
|
"ISM Code"
|
shall mean the International Safety Management Code for the Safe Operating of Ships and for Pollution Prevention constituted pursuant to Resolution A.741(18) of the International Maritime Organization and incorporated into the Safety of
Life at Sea Convention and shall include any amendments or extensions thereto and any regulation issued pursuant thereto;
|
|
|
"Joint Venture"
|
shall mean at any date any Person (other than a Subsidiary) in which OSG or any Subsidiary has an ownership interest which would be accounted for in the consolidated financial statements of OSG and its consolidated Subsidiaries by the
equity method if such statements were prepared as of such date;
|
|
|
"Judgment Currency"
|
shall have the meaning ascribed thereto in Section 11.7(a);
|
|
|
"Law"
|
shall mean any law, rule, regulation or official code, consent decree, constitution, decree, directive, enactment, guideline, injunction, interpretation, judgment, order, ordinance, policy statement, proclamation, promulgation,
requirement, rule of law, rule of public policy, settlement agreement, statute, or writ, of any Authority;
|
|
|
"LIBOR Rate"
|
shall mean, with respect to any Interest Period for any Advance, the rate per annum determined by the Facility Agent to be equal to the quotient (rounded upwards, if necessary, to the next higher 1/16 of 1%) of (y) (i) the
rate of interest for deposits in Dollars for a period equal to the number of days in such Interest Period (or, in the case of a Seven Day Interest Period, if greater, the rate of interest for deposits in Dollars for a one month period) which appears on
the Telerate Page 3750 as of 11:00 A.M., London time, on the day that is two Banking Days prior to the first day of such Interest Period, or (ii) if such rate does not appear on the Telerate Page 3750 at such time, the rate per annum at which
deposits in Dollars are offered to the Facility Agent in immediately available funds at its LIBOR lending office in an amount comparable to the principal amount of such Advance for a period equal to such Interest Period (or, in the case of a Seven Day
Interest Period, if greater, for a one month period) at approximately 10:00 A.M., New York City time, on the date two Banking Days before the first day of such Interest Period, divided by (z) a number equal to 1.00 minus the LIBOR Rate Reserve
Percentage;
|
|
|
"LIBOR Rate Reserve Percentage"
|
shall mean, for any day, the maximum percentage (expressed as a decimal) specified from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirements (including,
but not limited to, supplemental, marginal and emergency reserves) with respect to eurocurrency funding (currently referred to as "Eurocurrency Liabilities") of a member bank in such System. The LIBOR Rate shall be adjusted automatically with respect to
any Advance outstanding on the effective date of any change in the LIBOR Rate Reserve Percentage, as of such effective date;
|
|
|
"Lien"
|
shall mean any interest in property securing an obligation owed to, or a claim by, a Person other than the owner of the property, whether such interest is based on the common law, statute or contract, and including but not limited to
the security interest lien arising from a mortgage, encumbrance, pledge, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term "Lien" shall include reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases and other title exceptions and encumbrances (including, with respect to stock, stockholder agreements, voting trust
agreements, buy-back agreements and all similar arrangements) affecting property. For the purposes of this Agreement, OSG or a Recourse Subsidiary shall be deemed to be the owner of any property which it has acquired or holds subject to a conditional
sale agreement, Capitalized Lease or other arrangement pursuant to which title to the property has been retained by or vested in some other Person for security purposes and such retention or vesting shall constitute a Lien;
|
|
|
"Majority Banks"
|
shall mean Banks whose aggregate Commitments exceed one-half of the total Commitments or if the Commitments have terminated, Banks holding in the aggregate in excess of one-half of the Facility Balance;
|
|
|
"Material Adverse Change"
|
shall mean the occurrence of an event or condition which materially impairs the ability of OSG and the Subsidiaries to meet any of their obligations with regard to (i) the Facility and the financing arrangements established in
connection therewith or (ii) any of their respective other obligations that are material to OSG and the Subsidiaries considered as a whole;
|
|
|
"Material Financial Obligations"
|
means a principal or face amount of Debt (in the case of Derivative Obligations, determined in respect of any counterparty on a net basis), in each case of OSG and/or one or more of the Subsidiaries and arising in one or more
related or unrelated transactions, exceeding in the aggregate $10,000,000 (or its equivalent in any other currency);
|
|
|
"Material Subsidiary"
|
shall mean, at any date each of the following: (i) any Subsidiary (other than OSG Bulk or OSG International) which owns, leases or charters any vessel on such date and/or (ii) any Subsidiary or Subsidiaries the assets of
which, individually or in the aggregate, had an aggregate book value (net of depreciation) as of the date of the consolidated balance sheet of OSG and the Subsidiaries most recently delivered or required to be delivered to the Facility Agent pursuant to
Section 8.1(d) prior to such date in excess of the lesser of (x) $50,000,000 and (y) 2% of the aggregate book value (net of depreciation) of all assets of OSG and the Subsidiaries as of the date of such balance sheet;
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"Materials of Environmental Concern"
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shall have the meaning ascribed thereto in Section 7.1(h);
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"Minority Interests"
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shall mean any shares of stock of any class of a Subsidiary (other than directors' qualifying shares as required by law) that are not owned by OSG and/or one or more of the Recourse Subsidiaries. Minority Interests shall be valued by
valuing Minority Interests constituting preferred stock at the voluntary or involuntary liquidation value of such preferred stock, whichever is greater, and by valuing Minority Interests constituting common stock at the book value of capital and surplus
applicable thereto adjusted, if necessary, to reflect any changes from the book value of such common stock required by the foregoing method of valuing Minority Interests in preferred stock;
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"Xxxxx'x"
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Shall mean Xxxxx'x Investors Service, Inc., a credit rating agency;
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"Multiemployer Plan"
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Shall mean a "multiemployer plan" (as defined in Section 4001(a)(3) of ERISA) to which any Borrower or any ERISA Affiliate is making or accruing an obligation to make contributions or has within any of the preceding five plan years made
or accrued an obligation to make contributions;
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"Multiple Employer Plan"
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shall mean an employee benefit plan, other than a Multiemployer Plan, subject to Title IV of ERISA to which any Borrower or ERISA Affiliate, and one or more employers other than a Borrower or ERISA Affiliate, is making or accruing an
obligation to make contributions or, in the event that any such plan has been terminated, to which a Borrower or ERISA Affiliate made or accrued an obligation to make contributions during any of the five plan years preceding the date of termination of
such plan;
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"Net Income Available for Fixed Charges"
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for any period shall mean Consolidated Net Income during such period plus (to the extent deducted in determining Consolidated Net Income), (i) all provisions for any Federal, state or other taxes based on income made by OSG and the
Recourse Subsidiaries during such period and (ii) Fixed Charges during such period;
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"Non-Recourse Debt"
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shall mean Debt of any Subsidiary (i) that is not Guaranteed by OSG or any Recourse Subsidiary, (ii) that is not secured by a Lien on any asset of OSG or any Recourse Subsidiary and (iii) in respect of which neither OSG nor any of the
Recourse Subsidiaries has any express obligation or has written any instrument or letter indicating its support for such Subsidiary; provided that Debt of such Subsidiary shall constitute Non-Recourse Debt only if (x) OSG shall have given the Banks, through the Facility Agent, written notice at least twenty (20) days prior to the incurrence, issuance, assumption or Guarantee
thereof (or, in the case of Debt of a Person to be acquired by such Subsidiary, prior to the time of such acquisition) and (y) the terms and conditions of the related documentation insofar as they relate to the non-recourse nature of such Debt, and the
final form of such documentation with respect thereto, shall be reasonably satisfactory to the Majority Banks;
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"Non-Recourse Subsidiary"
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shall mean, at any time, a Subsidiary of OSG (i) having no Debt at such time (other than Non-Recourse Debt) and (ii) as to which an officer of OSG has, prior to the issuance, incurrence, assumption or Guarantee of any Non-Recourse Debt
by such Subsidiary, delivered a certificate to the Facility Agent certifying that such Subsidiary is a Non-Recourse Subsidiary in accordance with the terms of this Agreement;
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"Note"
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shall mean a promissory note, to be executed by the Borrowers in favor of a Bank pursuant to Section 3.1(b) to evidence the Advances made by such Bank and substantially in the form set out in Exhibit C or in such other form as the
Facility Agent may agree and shall include any promissory note issued by the Borrowers pursuant to Section 10.3, collectively, the "Notes";
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"Operating Assets"
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of OSG and the Recourse Subsidiaries shall mean, as of the date of any determination thereof, all assets of such Person as determined in accordance with GAAP other than Cash and marketable securities of OSG and the Recourse Subsidiaries;
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"Operator"
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shall mean, in respect of any of the Borrowers' vessels, the Person who is concerned with the operation of such vessel and falls within the definition of "Company" set out in rule 1.1.2 of the ISM Code;
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"OSG"
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shall have the meaning ascribed thereto in the preamble;
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"OSG Bulk"
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shall have the meaning ascribed thereto in the preamble;
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"OSG International"
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shall have the meaning ascribed thereto in the preamble;
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"Participant"
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shall have the meaning ascribed thereto in Section 10.2;
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"PBGC"
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shall mean the Pension Benefit Guaranty Corporation;
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"Permitted Countries"
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shall mean any or all of the following: United States of America, United Kingdom, Ireland, France, Belgium, the Netherlands, Germany, Sweden, Denmark, Norway, Switzerland, Finland, Austria, Spain, Portugal, Italy, Luxembourg, Canada
and Japan;
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"Permitted Investments"
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shall mean any of the following:
(a) Investments in commercial paper maturing in 270 days or less from the date of issuance which, at the time of acquisition by OSG or any Subsidiary, is rated one of the two highest ratings by S&P or by Moody's or any
substantially similar commercial paper or short-term ratings by any other nationally recognized credit rating agency domiciled in the United States of America or the United Kingdom which in the reasonable opinion of the Majority Banks is of similar
standing (a "Substitute Rating Agency");
(b) Investments in obligations issued by or guaranteed by the United States of America or any agency or instrumentality of the United States of America, in either case, maturing in three years or less from the date of acquisition
thereof;
(c) Investments in certificates of deposit, time deposits or bankers' acceptances issued by a Bank or any other bank or trust company organized under the laws of any Permitted Country or any state thereof, having capital, surplus and
undivided profits aggregating at least $300,000,000;
(d) Investments in indebtedness of any governmental body of the United States of America or any State or political subdivision thereof, which indebtedness is at all times accorded one of the two highest ratings by S&P, Moody's,
or a Substitute Rating Agency maturing not later than three years from the date of acquisition thereof (or, if maturing more than three years after the date of acquisition, which is subject to a put at par by the holder thereof on a weekly or more
frequent basis);
(e) Investments in money market investment programs which are classified as a current asset in accordance with GAAP and which are administered by reputable financial institutions having capital, surplus and undivided profits of at
least $300,000,000 and which are registered under the Investment Company Act of 1940, as amended; and
(f) investments in money market and auction rate preferred stocks rated "A" or better by S&P or Moody's or a similar category by a Substitute Rating Agency;
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"Person"
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shall mean an individual, partnership, corporation, limited liability company, business trust, bank, trust company, joint venture, association, joint stock company, trust or other unincorporated organization, whether or not a legal
entity, or any government or agency or political subdivision thereof;
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"Plan"
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shall mean any employee benefit plan (other than a Multiemployer Plan or a Multiple Employer Plan) covered by Title IV of ERISA or Section 302 of ERISA;
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"rate of exchange"
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shall have the meaning ascribed thereto in Section 11.7(d);
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"Recourse Subsidiaries"
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shall mean all Subsidiaries of OSG other than the Non-Recourse Subsidiaries;
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"Regulation T"
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shall mean Regulation T of the Board of Governors of the Federal Reserve System, as in effect from time to time;
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"Regulation U"
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shall mean Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time;
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"Regulation X"
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shall mean Regulation X of the Board of Governors of the Federal Reserve System, as in effect from time to time;
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"Rentals"
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shall mean and include as of the date of any determination thereof all fixed payments (including as such all payments which the lessee is obligated to make to the lessor on termination of the lease or surrender of the property) payable
by a Person, as lessee or sublessee under a lease of real or personal property (excluding fixed payments on any item of personal property involving rentals of less than $1,000 per month each and $10,000 per month in the aggregate), but shall be exclusive
of any amounts required to be paid by such Person, directly or indirectly (whether or not designated as rents or additional rents), on account of maintenance, repairs, insurance, taxes and similar charges. Fixed rents under any so-called "percentage
leases" shall be computed solely on the basis of the minimum rents, if any, required to be paid by the lessee regardless of sales volume or gross revenues;
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"Replacement Bank"
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shall have the meaning ascribed thereto in Section 11.8 of this Agreement;
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"Restricted Funds"
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shall mean restricted funds established and maintained pursuant to Title XI reserve fund and financial agreements between OSG or any of the Subsidiaries and the Secretary of Transportation in accordance with Title XI of the Merchant
Marine Act, 1936, as amended, and the regulations promulgated thereunder; provided that "Restricted Funds" shall mean, for any period, the aggregate amount on deposit in Restricted Funds as so defined as of the last day of such period, as the same is reflected in a consolidated balance sheet of OSG and the Subsidiaries
as of such date;
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"Restricted Investments"
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shall mean all Investments by OSG or any Recourse Subsidiary in any Person or property except the following:
(a) Permitted Investments;
(b) Cash;
(c) Investments in Shipping and Related Businesses in whatever form;
(d) Investments by OSG and the Recourse Subsidiaries in and to Recourse Subsidiaries, including any Investment in a corporation which, after giving effect to such Investment, will become a Recourse Subsidiary;
(e) Investments in property to be used in the ordinary course of business;
(f) Investments in marketable securities (as defined in accordance with GAAP); and
(g) Investments (in addition to those listed in (a) through (f) above) in Persons not engaged in Shipping and Related Businesses and which are not Recourse Subsidiaries in an amount (excluding Investments existing as of the date of
this Agreement) not to exceed the sum of (i) $10,000,000 plus (ii) 10% of Consolidated Tangible Net Worth;
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"Sale and Leaseback Transaction"
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shall mean any arrangement with any Person (not including OSG or any Recourse Subsidiary) or to which such Person is a party, providing for the leasing by OSG or a Recourse Subsidiary for a period, including renewals, in excess of three
years of any asset which has been or is to be sold or transferred more than 180 days after the acquisition or occupancy thereof or the completion of construction and commencement of full operation thereof, whichever is later, by OSG or any Recourse
Subsidiary to such Person;
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"Secured Debt"
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shall mean all Debt of OSG or any of the Recourse Subsidiaries which is secured by a Lien on any of the property or assets of OSG or any of the Recourse Subsidiaries;
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"Securities and Exchange Commission"
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shall mean the United States Securities and Exchange Commission or any other governmental authority of the United States of America at the time administrating the Securities Act of 1933, as amended, the Investment Company Act of 1940,
as amended, or the Exchange Act;
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"Security"
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shall have the same meaning as in Section 2(1) of the Securities Act of 1933, as amended;
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"Security Documents"
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shall have the meaning ascribed thereto in Section 8.1(s);
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"Seven Day Interest Period"
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shall have the meaning ascribed thereto in the definition of "Interest Period";
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"Shipping and Related Businesses"
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shall mean any one or all of the following: owning, chartering, leasing, crewing, navigating, managing, supplying, operating, building or repairing commercial vessels of all kinds, including but not limited to cargo ships, liners,
container ships, passenger vessels, fishing vessels, dredges, submersible and semi-submersible platforms, tugs, barges and ferries; owning, operating or managing transportation assets ancillary to or in furtherance of the transportation of freight and
passengers by water; owning, operating or managing warehouses, terminals and other facilities of any kind incidental or ancillary to or in furtherance of the transportation of freight and passengers by water; and owning, managing or operating pipelines,
terminals, docks, piers, quays, wharves, dry docks, storage facilities and port facilities incidental or ancillary to or in furtherance of the transportation of freight and passengers by water;
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"Shipping Manager"
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shall mean the principal company that, as of the date of this Agreement, is acting as agent for OSG and the Subsidiaries in respect of ships owned, leased or chartered by, and is providing substantially all of the general and
administrative services to, OSG and the Subsidiaries, or any Person, if, for the period of two years after the date of formation of such Person, all or substantially all of the executive officers and directors were executive officers or directors, as the
case may be, of the Shipping Manager immediately prior to the formation of such Person, except any executive officer or director who shall have been appointed or elected to such position as a result of any death, disability, retirement or incapacity of
any such executive officer or director;
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"S&P"
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shall mean Standard & Poor's Ratings Services, a division of XxXxxx-Xxxx Inc., a credit rating agency;
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"SMC"
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means the safety management certificate issued in respect of any of the Borrowers' vessels in accordance with rule 13 of the ISM Code;
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"Subordinated Funded Debt"
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shall mean all unsecured Funded Debt of the Borrowers which shall contain or have applicable thereto subordination provisions (reasonably satisfactory to the holders of not less than 66 2/3% in aggregate of the Commitments or, if the
Commitments have been terminated, of the Facility Balance) providing for the subordination thereof to other Debt of the Borrowers including, without limitation, the Notes;
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"subsidiary"
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shall mean as to any particular Person, any corporation or other entity of which more than 50% (by number of votes of the Voting Stock or other ownership interests having ordinary voting power) shall be beneficially owned or controlled,
directly or indirectly, by such Person and/or one or more other subsidiaries of such Person;
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"Subsidiary(ies)"
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shall mean a/the subsidiary(ies) of OSG;
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"Syndication Agent"
|
shall have the meaning ascribed thereto in the preamble;
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"Tangible Assets"
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shall mean, as of the date of determination thereof, the Book Value of assets of OSG and the Recourse Subsidiaries (less depreciation, depletion and other properly deductible valuation reserves) after deducting Intangible Assets thereof;
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"Taxes"
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shall mean any present or future income or other taxes, levies, duties, charges, fees, deductions or withholdings of any nature now or hereafter imposed, levied, collected, withheld or assessed by any taxing authority whatsoever, except
for taxes on or measured by the overall net income of any Bank imposed by the United States of America, the State or The City of New York or any governmental subdivision or taxing authority of any thereof or by any other taxing authority having
jurisdiction over such Bank (unless such jurisdiction is asserted solely by reason of the activities of the Borrower or any of the Subsidiaries);
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"Termination Event"
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shall mean (i) a "reportable event," as such term is defined in Section 4043 of ERISA, (ii) the withdrawal of any Borrower or any ERISA Affiliate from a Multiple Employer Plan during a plan year in which it was a "substantial
employer," as such term is defined in Section 4001(a)(2) of ERISA, or the incurrence of liability by any Borrower or any ERISA Affiliate under Section 4064 of ERISA upon the termination of a Multiple Employer Plan, (iii) the filing of a notice of
intent to terminate a Plan under Section 4041 of ERISA or the termination or the treatment of a Multiemployer Plan amendment as a termination under Section 4041A of ERISA, (iv) the institution of proceedings to terminate a Plan or a Multiemployer
Plan or (v) any other event or condition which might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan;
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"Unencumbered Assets"
|
shall mean, as of the date of any determination thereof, Tangible Assets (excluding any assets which consist of shares of stock of Subsidiaries which have been pledged to secure any obligations) less the sum of (i) Attributable
Debt and (without duplication) (ii) the Book Value of all assets of OSG and the Recourse Subsidiaries which are subject to a Lien securing Secured Debt;
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"Unsecured Debt"
|
shall mean, as of the date of any determination thereof, all Debt of OSG and the Subsidiaries other than Secured Debt;
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"Unterminated Voyage Revenues"
|
shall mean, as of the date of any determination thereof, the amounts thereof determined in accordance with GAAP as reflected in the consolidated financial statements of OSG and the Recourse Subsidiaries;
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"Vessel Collateral"
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shall have the meaning ascribed thereto in Section 8.1(s);
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"Voting Stock"
|
shall mean, with respect to any Person, Securities of any class or classes, the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the corporate directors (or Persons performing similar
functions) of such Person; and
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"Withdrawal Liability"
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shall have the meaning given to such term under Part 1 of Subtitle E of Title IV of ERISA.
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1.2. Computation of Time Periods; Other Definitional Provisions.
In this Agreement and the Notes, in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until"
each mean "to but excluding"; words importing either gender include the other gender; references to "writing" include printing, typing, lithography and other means of reproducing words in a tangible visible form; the words "
including," "includes" and "include" shall be deemed to be followed by the words "without limitation"; references to agreements and other contractual instruments (including this Agreement and the Notes) shall be deemed
to include all subsequent amendments, amendments and restatements, supplements, extensions, replacements and other modifications to such instruments (without, however, limiting any prohibition on any such amendments, extensions and other modifications by
the terms of this Agreement or the Notes); references to any matter that is "approved" or requires "approval" of a party shall mean approval given in the sole and absolute discretion of such party unless otherwise specified; words
importing the singular number only shall include the plural and vice versa (except as indicated), as may be appropriate; references to any Person shall include such Person, its successors and permitted assigns and transferees.
1.3. Accounting Terms.
Unless otherwise specified herein, all accounting terms used in this Agreement and in the Notes shall be interpreted, and all financial statements and certificates and reports as to financial matters required to be delivered to the
Facility Agent or to the Banks under this Agreement shall be prepared, in accordance with GAAP.
2. THE ADVANCES
2.1. Advances.
Each of the Banks, relying upon each of the representations and warranties set out in Section 7, hereby severally, and not jointly, agrees with the Borrowers that, subject to and upon the terms of this Agreement, it will on the
Drawdown Dates from time to time during the Facility Period make its portion of the Advances available through the Facility Agent, to the Borrowers in an aggregate amount not to exceed its Commitment ratably with the other Banks according to their
respective Commitments. The proceeds of the Advances shall be utilized for general corporate purposes. Multiple Advances may be outstanding at any one time during the Facility Period; provided, however, that there shall be no more than seven (7) different maturities for all Interest Periods relating to the Advances and only one (1) of such maturities may relate to a Seven Day Interest Period. Within the limits of this
Section 2.1 and upon the conditions herein provided, the Borrowers may from time to time borrow pursuant to this Section 2.1, repay Advances pursuant to Section 4 and reborrow pursuant to this Section 2.1.
2.2. Drawdown Notice.
The Borrowers shall, in respect of all Advances, serve a written notice (a "Drawdown Notice") on the Facility Agent (which shall promptly furnish a copy to each Bank) not later than 11:00 A.M., New York City time, at least three
(3) Banking Days prior to the date of the proposed Advance. Each Drawdown Notice shall specify (a) the date of the proposed borrowing (which shall be a Banking Day), (b) the principal amount of the Advance to be made by the Banks on that date, (c)
the Interest Period requested by the Borrowers, (d) the disbursement instructions for the proceeds of such Advance, and (e) the name of the Borrower(s) which will draw down such Advance. Each Drawdown Notice shall be effective upon receipt by the
Facility Agent, shall be irrevocable and shall be in the form set out in Exhibit D.
2.3. Effect of Drawdown Notice.
Each Drawdown Notice shall be deemed to constitute a warranty by the Borrowers: (a) that the representations and warranties stated in Section 7 are true and correct on the date of such Drawdown Notice and will be true and
correct on the applicable Drawdown Date as if made on such date, and (b) that no Default or Event of Default has occurred and is continuing on such Drawdown Date or would result from the making of an Advance.
2.4. Funding of Advances.
(a) Upon receipt of a Drawdown Notice, the Facility Agent shall promptly notify each Bank of the contents thereof and of such Bank's share of the proposed Advance.
(b) Not later than 11:00 A.M. (New York City time) on the Drawdown Date of each Advance, each Bank shall (except as provided in subsection (c) of this Section) make available its share of such Advance, in Federal or other
funds immediately available in New York City, to the Facility Agent at its address set forth on Schedule I. Unless the Facility Agent determines that any applicable condition specified in Section 3.1 or 3.2 has not been satisfied, the Facility
Agent will make the funds so received from the Banks available to the Borrowers at the aforesaid address, subject to the receipt of funds by the Facility Agent as provided in the immediately preceding sentence, not later than 2:30 P.M. (New York City
time) on the date of such Advance, and in any event as soon as practicable after receipt.
(c) If any Bank makes a new Advance hereunder to the Borrowers on a day on which the Borrowers are to repay all or any part of an outstanding Advance from such Bank, such Bank shall apply the proceeds of its new Advance to make such
repayment and only an amount equal to the difference (if any) between the amount being borrowed by the Borrowers and the amount being repaid shall be made available by such Bank to the Facility Agent as provided in subsection (b) of this Section, or
remitted by the Borrowers to the Facility Agent, as the case may be.
(d) Unless the Facility Agent shall have received notice from a Bank prior to the Drawdown Date of any Advance that such Bank will not make available to the Facility Agent such Bank's share of such Advance, the Facility Agent may
assume that such Bank has made such share available to the Facility Agent on the date of such Advance in accordance with subsections (b) and (c) of this Section 2.4 and the Facility Agent may, in reliance upon such assumption, make available to
the Borrowers on such date a corresponding amount. If and to the extent that such Bank shall not have so made such share available to the Facility Agent, such Bank and the Borrowers (but without duplication) severally agree to repay to the Facility Agent
forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrowers until the date such amount is repaid to the Facility Agent, at (i) in the case of the Borrowers, a
rate per annum equal to the higher of the Federal Funds Rate and the interest rate applicable thereto pursuant to Section 5.1 and (ii) in the case of such Bank, the Federal Funds Rate. If such Bank shall repay to the Facility Agent such
corresponding amount, such amount so repaid shall constitute such Bank's Advance included in such Advance for purposes of this Agreement as of the date such Advance was made. Nothing in this subsection (d) shall be deemed to relieve any Bank of its
obligation to make Advances to the extent provided in this Agreement. Notwithstanding anything in this Agreement to the contrary, in the event the Borrowers are required to repay an Advance to the Facility Agent pursuant to this Section 2.4(d), the
liability for any breakage costs as described in Section 11.6 shall be borne by the defaulting Bank and not the Borrowers.
2.5. Notation of Advances.
Each Advance made by a Bank to the Borrowers may be evidenced by a notation of the same made by such Bank on the applicable grid attached to such Bank's Note, which notation, absent manifest error, shall be prima facie evidence of
the amount of the relevant Advance.
2.6. Reduction of the Commitments.
(a) Subject to Section 2.9, the Borrowers may from time to time reduce the Commitments of the Banks by $20,000,000 or any larger multiple of $5,000,000 upon five (5) Banking Days' written notice to the Facility Agent (which shall
promptly notify each Bank). Any such reduction shall be permanent and irrevocable and pro rata among the Banks; provided that the amount of the aggregate Commitments after giving effect to such reduction of the Commitments shall at no time be less than the aggregate principal amount of all outstanding Advances.
(b) On the Final Payment Date, the Commitments shall be reduced to zero and any Advances then outstanding (together with accrued interest thereon) shall be due and payable on such date.
(c) After the effective date of any reduction pursuant to Section 2.6(a) hereof, the term "Commitment" shall mean the Commitments of each Bank in effect immediately prior to such reduction less the amount of such reduction of the
Commitment.
2.7. Mandatory Prepayments.
If at any time the principal amount of outstanding Advances shall exceed the aggregate Commitments then the Borrowers shall immediately prepay the Advances in an amount equal to such excess.
2.8. Several Obligations.
The failure of any Bank to make any Advance to be made by it on the date specified therefor shall not relieve any other Bank of its obligation to make its Advance on such date, and none of the Agents nor any Bank shall be responsible
for the failure of any other Bank to make an Advance to be made by such other Bank.
2.9. Pro Rata Treatment.
Each borrowing from the Banks hereunder shall be made from the Banks, each payment of the Commitment Fee or other fees and expenses under Section 12 shall be made for account of the Banks, and each termination or reduction of the amount
of the Commitments shall be applied to the Commitments of the Banks, pro rata according to the amounts of their respective Commitments; each payment or prepayment of principal of Advances by the Borrowers shall be made for account of the Banks pro rata in
accordance with the respective unpaid principal amounts of the Advances held by the Banks; and each payment of interest on Advances by the Borrowers shall be made for the account of the Banks pro rata in accordance with the amounts of interest due and
payable to the respective Banks.
3. CONDITIONS
3.1. Conditions Precedent to Availability of the Facility.
The obligation of the Banks to make the Facility available to the Borrowers under this Agreement shall be expressly subject to the following conditions precedent:
(a) Corporate Authority. The Facility Agent shall have received the following documents in form and substance satisfactory to the Facility Agent and its legal advisers:
(i) copies, certified as true and complete by an officer of each of the Borrowers, of the resolutions of its board of directors evidencing approval of this Agreement and the Notes and authorizing an appropriate officer or officers or
attorney-in-fact or attorneys-in-fact to execute the same on its behalf;
(ii) copies, certified as true and complete by an officer of each of the Borrowers, of all documents evidencing any other necessary action, approvals or consents with respect to this Agreement and the Notes and the transactions
contemplated hereby and thereby;
(iii) copies, certified as true and complete by an officer of each of the Borrowers, of the certificate or articles of incorporation and by-laws or similar constituent document thereof;
(iv) a good standing certificate (or, in the case of OSG International, the equivalent thereof) of the jurisdiction of incorporation or formation of each of the Borrowers; and
(v) a certificate signed by the President, Treasurer, Comptroller, Controller or chief financial officer of each of the Borrowers to the effect that (A) no Default or Event of Default shall have occurred and be continuing and (B)
the representations and warranties of the Borrowers contained in this Agreement are true and correct as of the date of such certificate.
(b) The Agreement and the Notes. The Borrowers shall have duly executed and delivered this Agreement and the Notes to the Facility Agent.
(c) The Creditors. The Facility Agent shall have received executed counterparts of this Agreement from each of the Banks and the Agents (or, in the case of any Bank as to which an executed counterpart shall not have been
received, the Facility Agent shall have received in form satisfactory to it a telex, facsimile or other written confirmation from such Bank of the execution of a counterpart of this Agreement by such Bank).
(d) Fees. The Creditors shall have received payment in full of all other fees and expenses due to each thereof pursuant to the terms hereof on the date when due including, without limitation, all fees and expenses due under
Section 12.
(e) Environmental Claims. The Banks shall be satisfied that none of the Borrowers nor any Subsidiary is subject to any Environmental Claim which could reasonably be expected to result in a Material Adverse Change.
(f) Legal Opinions. The Facility Agent shall have received opinions addressed to the Agents and the Banks from (i) Proskauer Rose LLP, special counsel to the Borrowers, (ii) Xxxxxx X. Xxxxx, Esq., Senior Vice President and
Chief Operating Officer of OSG and counsel to OSG and OSG Bulk, (iii) Xxxx X. Xxxx, Esq., counsel to OSG International, and (iv) Xxxxxx & Xxxxxx LLP, special counsel to the Agents, in such form as the Agents may agree, as well as such other legal
opinions as the Banks shall have required as to all or any matters under the laws of the State of Delaware, the United States of America and the State of New York covering the conditions and representations and warranties which are the subjects of
Sections 3 and 7, respectively.
(g) Appointment of Process Agent. The Facility Agent shall have received a duly executed copy of the acceptance by OSG Ship Management, Inc. of its appointment as agent for service of process for OSG International.
(h) Officer's Certificate. The Facility Agent shall have received a certificate signed by the President or chief financial officer of OSG certifying that (i) the commitments of the banks or other lenders under the Existing
Credit Facility shall have been, or simultaneously will be, reduced to $425,000,000 and (ii) under Applicable Law existing on the date hereof, no Borrower shall be compelled by law to withhold or deduct any Taxes from any amounts to become payable to the
Facility Agent for the account of the Creditors hereunder.
(i) Insurance. Receipt by the Facility Agent of evidence satisfactory to it of the existence and effectiveness of the insurance required to be maintained by or on behalf of OSG, the Subsidiaries and the Joint Ventures
pursuant to Section 8.1(l).
3.2. Further Conditions Precedent.
The obligation of the Banks to make an Advance available to the Borrowers shall be expressly and separately from the foregoing conditional upon, on each Drawdown Date:
(a) Drawdown Notice. The Facility Agent having received a Drawdown Notice in accordance with the terms of Section 2.2.
(b) Representations and Warranties True. The representations stated in Section 7 being true and correct as if made on that date; provided, however, that (i) the representations and warranties set forth
in Section 7.1(e) and (o) shall be deemed inapplicable on such date if such Advance would not result in an incremental increase in the aggregate amount of Advances outstanding under the Facility and (ii) any representation and warranty which relates
solely to an earlier date shall be true and accurate on and as of such earlier date.
(c) No Default. No Default or Event of Default having occurred and being continuing or would result from the making of an Advance.
(d) No Material Adverse Change. There having been no Material Adverse Change since December 31, 1999; provided however, that this condition shall not apply to any Advance which would not result in an
incremental increase in the aggregate amount of Advances outstanding under the Facility.
3.3. Satisfaction after Drawdown.
Without prejudice to any of the other terms and conditions of this Agreement, in the event all of the Banks elect, in their sole discretion, to make an Advance prior to the satisfaction of all or any of the conditions referred to in
Sections 3.1 and 3.2, the Borrowers hereby covenant and undertake to satisfy or procure the satisfaction of such condition or conditions within seven (7) days after the Drawdown Date (or such longer period as the Majority Banks, in their sole
discretion, may agree).
4. REPAYMENT AND PREPAYMENT
4.1. Repayment.
Each Borrower jointly and severally agrees to repay to the Banks the principal of each Advance made to the Borrowers on the last day of the Interest Period therefor and any then outstanding principal of any and all of the Advances made
to the Borrowers on the Final Payment Date.
4.2. Prepayment.
The Borrowers may, at their option, on any Banking Day, prepay all or any portion of the principal of any Advance. The Borrowers shall compensate the Banks and Participants or any thereof for any loss, cost or expense incurred by them
as a result of a prepayment made on any day other than the last day of an Interest Period in accordance with the provisions of Section 11.6. Prepayments made on the last day of any Interest Period shall be without penalty or premium. Any prepayment
shall be in an integral multiple of $1,000,000 with a minimum amount of $10,000,000. In addition, on the date of any prepayment hereunder, all accrued interest to the date of such prepayment must be paid in full with respect to the Advances or portions
thereof being prepaid. The Borrowers shall deliver to the Facility Agent (which shall promptly furnish a copy to each Bank) notice of such prepayment on not less than three (3) Banking Days (which notice shall be irrevocable and shall specify the
date and amount of prepayment).
4.3. Borrowers' Obligations Absolute.
The Borrowers' obligations to pay each Creditor hereunder and under the Notes shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms hereof and thereof, under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which the Borrowers or any of them may have or have had against the Creditors.
5. INTEREST AND RATE
5.1. Payment of Interest; Interest Rate.
(a) Each Borrower hereby jointly and severally promises to pay to the Banks interest on the unpaid principal amount of each outstanding Advance made to the Borrowers for the period commencing on the date of such Advance until but not
including the stated maturity thereof (whether by acceleration or otherwise) or the date of prepayment thereof at the Applicable Rate which shall be the rate per annum which is equal to the aggregate of (a) the LIBOR Rate for the relevant Interest Period
plus (b) the Applicable Margin. The Applicable Rate with respect to each Advance shall be determined by the Facility Agent two Banking Days prior to the first day of the relevant Interest Period. The Facility Agent shall promptly notify the Borrowers
and the Banks in writing of the Applicable Rate and the duration of each Interest Period as and when determined. Each such determination, absent manifest error, shall be conclusive and binding upon the Borrowers.
(b) Notwithstanding the foregoing, each Borrower jointly and severally agrees that after the occurrence and during the continuance of an Event of Default, each outstanding Advance shall bear interest at a rate per annum equal to
the greater of (A) two percent (2%) plus the Applicable Rate in effect with respect to such Advance and (B) two percent (2%) plus the sum of (x) the Applicable Margin plus (y) the LIBOR Rate for overnight or weekend deposits (the "Default Rate"). In addition, each Borrower hereby jointly and severally promises to pay interest on any Advance made to the Borrowers or any installment thereof and (to the extent that the payment of such interest shall be legally
enforceable) on any overdue installment of interest, and on any other amount payable by the Borrowers hereunder which shall not be paid in full when due (whether at stated maturity, by acceleration or otherwise), for the period commencing on the due date
thereof until but not including the date the same is paid in full at the Default Rate.
(c) Except as provided in the next sentence, accrued interest on each Advance shall be payable (i) on the last day of each Interest Period, except that if the Borrowers shall select an Interest Period in excess of three (3) months,
accrued interest shall be payable during such Interest Period on each three (3) month anniversary of the commencement of such Interest Period and upon the last day of such Interest Period, and (ii) with each repayment of principal thereof. Interest
payable at the Default Rate shall be payable from time to time on demand of the Facility Agent.
5.2. Calculation of Interest.
All interest shall accrue from day-to-day and be calculated on the actual number of days elapsed and on the basis of a three hundred sixty (360) day year.
5.3. Maximum Interest.
Anything in this Agreement or the Notes to the contrary notwithstanding, the interest rate on any Advance shall in no event be in excess of the maximum rate permitted by Applicable Law.
6. PAYMENTS
6.1. Place of Payments; No Set Off.
All payments to be made hereunder by the Borrowers shall be made in Dollars on the due dates of such payments to the Facility Agent at its office located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000 or to such other branch of
the Facility Agent as the Facility Agent may direct, without set-off or counterclaim and free from, clear of and without deduction for, any Taxes; provided, however, that if the Borrowers shall at any time be compelled by law to withhold or deduct any Taxes from any amounts payable to the Facility Agent for the account of the Banks or the other Creditors hereunder, then, the Borrowers
shall pay such additional amounts as may be necessary in order that the net amounts received after withholding or deduction shall equal the amounts which would have been received if such withholding or deduction were not required and, in the event any
withholding or deduction is made, whether for Taxes or otherwise, the Borrowers shall promptly send to the Facility Agent any documentary evidence they have with respect to such withholding or deduction. No Bank shall change its lending office if such change would result in the Borrowers being compelled by law to withhold or deduct any Taxes from any
amounts payable to the Facility Agent for the account of the Banks or the other Creditors hereunder.
6.2. Federal Income Tax Credits.
(a) If any Bank obtains the benefit of a credit against its liability for federal income taxes imposed by the United States of America for all or part of the Taxes as to which the Borrowers have paid additional amounts as aforesaid
then such Bank shall reimburse the Borrowers for the amount of the credit so obtained; (b) each of the Banks that is not a United States Person (as such term is defined in Section 7701(a)(30) of the Code) shall, on or prior to the first Drawdown Date
(and in the case of an assignee, on or prior to the effective date of the relevant assignment) and from time to time thereafter when required by applicable provisions of the Code, provide the Borrowers with two duly completed copies of Internal Revenue
Service Form 1001 or 4224, as appropriate, or any successor form prescribed by the Internal Revenue Service, certifying that such Bank is entitled to benefits under an income tax treaty to which the United States is a party that exempts withholding tax on
payments under this Agreement or the Notes or certifying that the income receivable by it pursuant to this Agreement or the Notes is effectively connected with the conduct of a trade or business in the United States; (c) for any period with respect
to which a Bank that is not a United States Person has failed to provide the Borrowers with the appropriate forms described in clause (b) above (other than if such failure is due to a change in law occurring after the date on which such person was
originally required to provide such forms, or if such forms are otherwise not required under clause (b) above), such Bank shall not be entitled to payment of additional amounts under Section 6.1 with respect to Federal Taxes imposed by the United States; provided, however, that should a Bank become subject to Taxes because of its failure to deliver a form required hereunder, the Borrowers shall take such steps as such Bank shall reasonably request to assist such Bank to recover such Taxes
if, in the judgment of the Borrowers such steps would avoid the need for, or reduce the amount of, any Taxes required to be deducted from or in respect of any sum payable hereunder to such Bank and would not, in the judgment of the Borrowers, be
disadvantageous to the Borrowers.
6.3. Sharing of Setoffs.
Each Bank agrees that if it shall, through the exercise of a right of banker's lien, setoff or counterclaim or pursuant to a secured claim under Section 506 of the Federal Bankruptcy Code or other security or interest arising from, or
in lieu of, such secured claim, exercised or received by such Bank under any applicable bankruptcy, insolvency or other similar law or otherwise, or by any other means (except in the event of such Bank's replacement pursuant to Section 11.8), obtain
payment (voluntary or involuntary) in respect of any Advance or Advances as a result of which the unpaid principal portion of its Advances (and accrued and unpaid interest thereon) shall be proportionately less than the unpaid principal portion of the
Advances (and accrued and unpaid interest thereon) of any other Bank, it shall be deemed simultaneously to have purchased from such other Bank at face value, and shall promptly pay to such other Bank the purchase price for, a participation in the Advances
of such other Bank so that the aggregate unpaid principal amount of the Advances (and accrued and unpaid interest thereon) and participations in the Advances held by each Bank shall be in the same proportion to the aggregate unpaid principal amount of all
Advances then outstanding as the principal amount of its Advances (and accrued and unpaid interest thereon) prior to such exercise of banker's lien, setoff or counterclaim or other event was to the principal amount of all Advances outstanding (and accrued
and unpaid interest thereon) prior to such exercise of banker's lien, setoff or counterclaim or other event; provided, however, that, if any such purchase or purchases or adjustments shall be made pursuant to this Section 6.3 and the payment giving rise thereto shall thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or adjustment restored without interest. Any Bank holding a participation in an Advance deemed to have been so purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing to such Bank by reason thereof as fully as if such Bank had made an Advance in the amount of such participation. The Borrowers expressly consent to the foregoing arrangement.
7. REPRESENTATIONS AND WARRANTIES
7.1.
In order to induce the Creditors to enter into this Agreement and to make the Facility available, the Borrowers hereby, jointly and severally, represent and warrant to the Banks (which representations and warranties shall survive the
execution and delivery of this Agreement and the Notes and each drawdown of the Facility) that:
(a) Due Organization and Power. Each of the Borrowers is a corporation duly formed and validly existing in good standing under the laws of its jurisdiction of incorporation and is duly qualified and is authorized to do
business as a foreign corporation in each jurisdiction wherein the nature of the business transacted thereby makes such qualification necessary, except where failure to so qualify would not result in a Material Adverse Change, has full power and authority
and, to the best of its knowledge, all material governmental licenses, authorizations, consents and approvals required to carry on its business as now being conducted and to own its properties and to enter into and perform its obligations under this
Agreement and the Notes, and has complied with all statutory, regulatory and other requirements relative to such business, property and such agreements the noncompliance with which could reasonably be expected to result in a Material Adverse Change.
(b) Authorization and Consents. All necessary corporate action has been taken to duly authorize, and all necessary consents and authorities have been obtained and remain in full force and effect to permit, each of the
Borrowers to enter into and perform its obligations under this Agreement and the Notes and to borrow, service and repay the Advances and, as of the date of this Agreement, no further consents or authorities are necessary for the service and repayment of
the Advances or any part thereof.
(c) Binding Obligations. Each of this Agreement and the Notes constitutes a legal, valid and binding obligation of such Borrower enforceable against such Borrower in accordance with its terms.
(d) No Violation. Neither the execution and delivery by the Borrowers of this Agreement or the Notes, or any instrument or agreement referred to herein or therein, or contemplated hereby or thereby, nor the consummation
of the transactions herein or therein contemplated, nor compliance with the terms, conditions and provisions hereof or thereof by it, will (i) conflict with, or result in a breach or violation of, or constitute a default under the organizational
documents of the Borrowers; (ii) conflict with or contravene any Applicable Law or any contractual restriction binding on or affecting the Borrowers or any of their respective assets or properties; (iii) result in a material breach or violation
of, or constitute a default under, or permit the acceleration of any obligation or liability in, or but for any requirement of the giving of notice or the passage of time (or both) would constitute such a conflict with, breach or violation of, or default
under, or permit any such acceleration in, any contractual obligation or any agreement or document to which any of the Borrowers is a party or by which any of the Borrowers or any of their respective assets or properties is bound (or to which any such
obligation, agreement or document relates); or (iv) result in any material Lien upon any of the Borrowers' respective assets or properties.
(e) Litigation. No action, suit or proceeding is pending or threatened against OSG or any Subsidiary before any court, board of arbitration or administrative agency which could be reasonably expected to result in any
Material Adverse Change or which in any manner draws into question the validity or enforceability of this Agreement or the Notes.
(f) No Default. Neither OSG nor any of the Subsidiaries is in default under any material agreement by which it is bound and no circumstances, conditions, acts or events have occurred and are continuing or will result from
the transactions contemplated hereby which constitute or would give rise to or would with the passage of time or the giving of notice or both constitute a default under any such agreement.
(g) ERISA. The execution and delivery of this Agreement and the consummation of the transactions hereunder will not involve any prohibited transaction within the meaning of ERISA or Section 4975 of the Code and no
condition exists or event or transaction has occurred in connection with any Plan maintained or contributed to by any member of the ERISA Group or any ERISA Affiliate resulting from the failure of any thereof to comply with ERISA which is reasonably
likely to result in any member of the ERISA Group or any ERISA Affiliate incurring any liability, fine or penalty which individually or in the aggregate could result in a Material Adverse Change. No member of the ERISA Group nor any ERISA Affiliate,
individually or collectively, has incurred, or reasonably expects to incur, Withdrawal Liabilities or liabilities upon the happening of a Termination Event the aggregate of which for all such Withdrawal Liabilities and other liabilities exceeds or would
exceed $30,000,000. With respect to any Multiemployer Plan, Multiple Employer Plan or Plan, no member of the ERISA Group nor any ERISA Affiliate is aware of or has been notified that any "variance" from the "minimum funding standard" has been requested
(each such term as defined in Part 3, Subtitle B, of Title 1 of ERISA). No member of the ERISA Group nor any ERISA Affiliate has received any notice that any Multiemployer Plan is in reorganization, within the meaning of Title IV of
ERISA, which reorganization could result in a Material Adverse Change.
(h) Environmental Matters and Claims. (A) OSG and each Subsidiary and the Affiliates of each thereof will, when required, be in compliance with all applicable United States federal and state, local, foreign and
international laws, regulations, conventions and agreements relating to pollution, pollution prevention or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, navigable waters, waters of
the contiguous zone, ocean waters and international waters), including, without limitation, laws, regulations, conventions and agreements relating to (1) emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous materials, oil, hazardous substances, petroleum and petroleum products and by-products ("Materials of Environmental Concern"), or (2) the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern ("Environmental Laws") (except as to all of the
above, where the failure to do so would not be reasonably likely to result in a Material Adverse Change); (B) OSG, each Subsidiary and the Affiliates of each thereof will, when required, have all permits, licenses, approvals, rulings, variances,
exemptions, clearances, consents or other authorizations required under applicable Environmental Laws ("Environmental Approvals") and will, when required, be in compliance with all Environmental Approvals required to operate their respective businesses as then being conducted (except where the failure to comply with, obtain or renew such permits,
licenses, rulings, variances, exemptions, clearances, consents or other authorizations would not be reasonably likely to result in a Material Adverse Change); (C) neither OSG, nor any Subsidiary nor any Affiliates of any thereof has received any
notice of any claim, action, cause of action, investigation or demand by any Person, entity, enterprise or government, or any political subdivision, intergovernmental body or agency, department or instrumentality thereof, alleging potential liability
which would be reasonably likely to result in a Material Adverse Change or a requirement to incur, investigatory costs, cleanup costs, response and/or remedial costs (whether incurred by a governmental entity or otherwise), natural resources damages,
property damages, personal injuries, attorneys' fees and expenses, or fines or penalties which would be reasonably likely to result in a Material Adverse Change, in each case arising out of, based on or resulting from (1) the presence, or release or
threat of release into the environment, of any Materials of Environmental Concern at any location, whether or not owned by such person, or (2) circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or
Environmental Approval ("Environmental Claim") (other than Environmental Claims that have been fully and finally adjudicated or otherwise determined and all fines, penalties and other costs, if any, payable by OSG or any of the Subsidiaries in respect thereof have been
paid in full or which are fully covered by insurance (including permitted deductibles)); (D) to the best of the Borrowers' knowledge, there are no circumstances that would be reasonably likely to prevent or interfere with such full compliance in the
future; and (E) there is no Environmental Claim pending or, to the best of the Borrowers' knowledge, threatened against OSG, any Subsidiary or any Affiliate of any thereof and to the best of the Borrowers' knowledge, there are no past or present
actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge or disposal of any Materials of Environmental Concern, that could reasonably be expected to form the basis of any
Environmental Claim against such persons the adverse disposition of which could reasonably be expected to result in a Material Adverse Change.
(i) Subsidiaries. (A) Each Material Subsidiary is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation, and has all corporate powers and authority
and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and to own its properties and (B) there are no Non-Recourse Subsidiaries as of the date hereof.
(j) Financial Statements. Each of the audited consolidated balance sheet of OSG and the Subsidiaries as at December 31, 1999 and the related audited consolidated statements of operations and retained earnings and cash
flows for the fiscal year then ended reported on by Ernst & Young LLP and included in OSG's 1999 Form 10-K, copies of all of which have been furnished to each Bank, fairly present, in all material respects, the consolidated financial condition of OSG
and the Subsidiaries as at such dates and the consolidated results of the operations of OSG and the Subsidiaries for the periods ended on such dates, all in accordance with GAAP.
(k) Tax Returns and Payments. United States Federal income tax returns of OSG and the Subsidiaries have been examined and closed through the fiscal year ended December 31, 1996. OSG and the Subsidiaries have filed
all United States Federal, state, local and foreign income tax returns and all other material tax or information returns which are required to be filed by them (collectively, the "Tax Returns"). All of the Tax Returns (and any tax or information return becoming due after the date hereof and on or before the Closing Date) are true and complete in all material respects. OSG and the Subsidiaries have paid all material
federal, state, local and foreign taxes (collectively, the "OSG Taxes") due pursuant to the Tax Returns or pursuant to any assessment received by OSG or any Subsidiary, other than OSG Taxes which are being contested in good faith by appropriate proceedings and for which adequate reserves (in conformity
with GAAP consistently applied) shall have been set aside on their books. The charges, accruals and reserves on the books of OSG and the Subsidiaries in respect of OSG Taxes are adequate in all material respects and in conformity with GAAP consistently
applied. There is no material action, suit, proceeding, audit, investigation or claim pending or, to the knowledge of OSG, threatened in respect of any OSG Taxes for which OSG or any of the Subsidiaries is or may become liable nor has any deficiency or
claim for any such OSG Taxes been proposed, asserted or, to the knowledge of OSG, threatened. OSG has not consented to any waivers or extensions of any statute of limitations with respect to the collection or assessment of any OSG Taxes against it.
(l) Insurance. Each of OSG and the Subsidiaries has insured its properties and assets against such risks and in such amounts as are customary for companies engaged in similar businesses. The properties and assets of each
Joint Venture have been insured against such risks and in such amounts as are customary for companies engaged in similar businesses.
(m) Foreign Trade Control Regulations. None of the transactions contemplated herein will violate any of the provisions of the Foreign Assets Control Regulations of the United States of America (Title 31, Code of
Federal Regulations, Chapter V, Part 500, as amended), any of the provisions of the Cuban Assets Control Regulations of the United States of America (Title 31, Code of Federal Regulations, Chapter V, Part 515, as amended), any of
the provisions of the Libyan Assets Control Regulations of the United States of America (Title 31, Code of Federal Regulations, Chapter V, Part 550, as amended), any of the provisions of the Iranian Transaction Regulations of the United
States of America (Title 31, Code of Federal Regulations, Chapter V, Part 560, as amended), any of the provisions of the Iraqi Sanctions Regulations (Title 31, Code of Federal Regulations, Chapter V, Part 575, as amended), any of the
provisions of the Federal Republic of Yugoslavia (Serbia and Montenegro) and Bosnian Serb-Controlled Areas of the Republic of Bosnia and Herzegovina Sanctions Regulations (Title 31, Code of Federal Regulations, Chapter V, Part 585, as
amended), any of the provisions of the Regulations of the United States of America Governing Transactions in Foreign Shipping of Merchandise (Title 31, Code of Federal Regulations, Chapter V, Part 505, as amended) or any other applicable
foreign trade control regulation.
(n) Investment Company Act. Neither OSG nor any of the Subsidiaries is an "investment company" or an "affiliated person" of, or a "promoter" or "principal underwriter" for or a company "
controlled" by, an "investment company" as such terms are defined in the Investment Company Act of 1940, as amended; neither the making of the Advances nor the application of the proceeds or repayment thereof by the Borrowers, nor the
consummation of the other transactions contemplated hereby, will violate any provision of such act or any rule, regulation or order of the Securities and Exchange Commission thereunder.
(o) No Material Adverse Change. Since December 31, 1999, there has been no Material Adverse Change.
(p) Compliance with ISM Code. Each of the Borrowers' and Subsidiaries' vessels and each Operator thereof complies with the requirements of the ISM Code in all material respects including (but
not limited to) obtaining all necessary ISM Code documentation and the maintenance and renewal of valid certificates pursuant thereto.
(q) No Threatened Withdrawal of DOC or SMC. There is no actual or, to the best of the Borrowers' knowledge, threatened withdrawal of any Operator's DOC, SMC or other certification or
documentation related to the ISM Code in respect of any of the Borrowers' or Subsidiaries' vessels.
(r) No Proceedings to Dissolve. There are no proceedings or actions pending or, to the best of the Borrowers' knowledge, contemplated by any of the Borrowers to dissolve or terminate such
Borrowers.
(s) Compliance with Laws. Each of the Borrowers is in compliance with all Applicable Laws, except where any failure to comply with any such Applicable Laws would not, alone or in the aggregate,
result in a Material Adverse Change.
(t) OSG International Not Immune. OSG International is generally subject to suit, and neither OSG International nor any of its properties or assets has any immunity from the jurisdiction of any court or from legal process
(whether through service of process or notice of attachment prior to judgment, attachment in aid of execution or otherwise) under the laws of the Xxxxxxxx Islands or any political subdivision thereof.
(u) No Xxxxxxxx Islands Filing Necessary. To ensure the enforceability or admissibility in evidence of this Agreement and/or the Notes, it is not necessary that this Agreement or any of the Notes be filed or recorded with
any court or other authority in the Xxxxxxxx Islands or any political subdivision thereof or that any stamp or similar tax be paid hereon or thereon or in respect hereof or thereof.
8. COVENANTS
8.1. Affirmative Covenants.
Each of the Borrowers hereby covenants and undertakes with each of the Banks that, from the date hereof and so long as the Commitments are in effect or any principal, interest or other moneys are owing in respect of the Facility or
otherwise owing under this Agreement or the Notes or any of them, such Borrower will:
(a) Performance of Agreements. Duly perform and observe the terms of this Agreement and the Notes.
(b) Notice of Default. Inform the Facility Agent (which shall promptly, and in any event within three (3) Banking Days, notify the Banks) of the occurrence of (i) any Default or Event of Default, (ii) any
litigation or governmental proceeding pending or threatened against OSG or any Subsidiary which in any manner draws into question the validity or enforceability of this Agreement or any Note or which could reasonably be expected to result in a Material
Adverse Change and (iii) any other event or condition of which it becomes aware which is reasonably likely to result in a Material Adverse Change, in each case, promptly, and in any event within three (3) Banking Days after becoming aware of the
occurrence thereof.
(c) Consents. Without prejudice to Section 7.1 and this Section 8.1, obtain every consent and do all other acts and things which may from time to time be necessary for the continued due performance of all its
obligations under this Agreement and the Notes.
(d) Financial Statements. Deliver to the Facility Agent with sufficient copies for the other Creditors to be distributed to the other Creditors by the Facility Agent promptly upon receipt thereof:
(i) as soon as available and in any event within 90 days after the end of each fiscal year of OSG, (A) a consolidated balance sheet of OSG and the Subsidiaries as of the end of such fiscal year and the related consolidated statements
of income and retained earnings and cash flows for such fiscal year, setting forth in each case in comparative form the figures as of the end of and for the previous fiscal year, complying in all material respects with all applicable rules and regulations
promulgated by the Securities and Exchange Commission, in each case accompanied by an unqualified opinion of Ernst & Young LLP or other independent public accountants of nationally recognized standing and (B) if there are any Non-Recourse
Subsidiaries, an unaudited consolidated balance sheet of OSG and the Recourse Subsidiaries as of the end of such fiscal year and the related unaudited consolidated statements of income and retained earnings and cash flows for such fiscal year, setting
forth in each case in comparative form the figures as of the end of and for the previous fiscal year, together with a letter from the independent public accountants referred to in the foregoing clause (A) confirming the mathematical accuracy of such
financial statements and the derivation thereof on a reasonable basis from the audited financial statements referred to in clause (A);
(ii) as soon as available and in any event within 60 days after the end of each of the first three fiscal quarters of each fiscal year of OSG, (A) an unaudited consolidated balance sheet of OSG and the Subsidiaries as of the end of
such fiscal quarter and the related unaudited consolidated statements of income and retained earnings and cash flows for such fiscal quarter and for the portion of OSG's fiscal year ended at the end of such fiscal quarter, setting forth in each case in
comparative form the figures as of the end of and for the corresponding fiscal quarter and the corresponding portion of OSG's previous fiscal year, all certified (subject to normal year-end adjustments) as to fairness of presentation and compliance in all
material respects with all applicable rules and regulations of the Securities and Exchange Commission with respect to interim financial statements and consistency by the chief financial officer or the chief accounting officer of OSG and (B) if there are
any Non-Recourse Subsidiaries, an unaudited consolidated balance sheet of OSG and the Recourse Subsidiaries as of the end of such fiscal quarter and the related unaudited consolidated statements of income and retained earnings and cash flows for such
fiscal quarter and for the portion of OSG's fiscal year ended at the end of such fiscal quarter, setting forth in each case in comparative form the figures as of the end of and for the corresponding fiscal quarter and the corresponding portion of OSG's
previous fiscal year, together with a certificate of the chief financial officer or chief accounting officer of OSG as to the derivation of such financial statements from the financial statements referred to in clause (A) of this subsection (ii);
(iii) simultaneously with the delivery of each set of financial statements referred to in clauses (i)(A) and (ii)(A) above, a Compliance Certificate of OSG executed by OSG's chief financial officer or chief accounting officer (A)
setting forth in reasonable detail the calculations required to establish whether the covenants set forth in Sections 8.1(o) through (r) and 8.2(a), (c), (e) and (h) were complied with on the date of such financial statements, and (B) stating whether
any Default or Event of Default exists on the date of such Certificate and, if any Default or Event of Default then exists, setting forth the details thereof and the action which the Borrowers are taking or propose to take with respect thereto;
(iv) simultaneously with the delivery of each set of financial statements referred to in clause (i)(A) above, a statement of the firm of independent public accountants which reported on such statements (A) stating whether
anything has come to their attention to cause them to believe that OSG and the Subsidiaries were not in compliance with any of the covenants set forth in Sections 8.1(o) through (r) and 8.2(a), (c), (e) and (h) on the date of such statements and (B)
confirming the calculations set forth in the officer's certificates delivered simultaneously therewith pursuant to subsection (iii) above or, with respect to the calculations required to derive the amount referred to in the covenants set forth in Section
8.1(o) through (r) and 8.2 (a), (c), (e) and (h), verifying the mathematical accuracy of such calculations and comparing Consolidated Net Income for each of the relevant fiscal quarters with the consolidated income statement of OSG and the Recourse
Subsidiaries for such fiscal quarter;
(v) within three Banking Days after the date on which any executive officer of any of the Borrowers obtains knowledge of (A) any Default or Event of Default, if such Default or Event of Default is then continuing or (B) a Material
Adverse Change or any action, suit or proceeding of the type referred to in Section 7.1(e), a certificate of the chief financial officer or the chief accounting officer of each of the Borrowers setting forth the details thereof and the action which the
Borrowers are taking or propose to take with respect thereto;
(vi) promptly upon the mailing thereof to the shareholders of OSG generally, copies of all financial statements, reports and proxy statements so mailed;
(vii) promptly upon the filing thereof, copies of all registration statements (other than the exhibits thereto and any registration statements on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents) which OSG shall have filed with the Securities and Exchange Commission;
(viii) as soon as possible, (A) copies of all reports and notices which any member of the ERISA Group or ERISA Affiliate files under ERISA with the Internal Revenue Service or the PBGC or the U.S. Department of Labor or the sponsor
of a Multiemployer Plan or which any member of the ERISA Group or ERISA Affiliate receives from the PBGC or the sponsor of a Multiemployer Plan relating to (1) any Termination Event and (2) with respect to a Multiemployer Plan, any Withdrawal Liability,
or any actual or expected reorganization (within the meaning of Title IV of ERISA) or termination of a Multiemployer Plan (within the meaning of Title IV of ERISA) and (B) a certificate of the chief financial officer or chief accounting officer of OSG
setting forth in reasonable detail the calculation of the amount (to the extent then reasonably determinable) of any liability in connection with the foregoing;
(ix) within 72 hours after any officer of any of the Borrowers becomes aware of any change in the rating by Xxxxx'x or S&P of OSG's publicly-traded senior unsecured long-term debt securities, notice of such change;
(x) in the event of any change in OSG's fiscal year, OSG shall as soon as possible, restate such of its consolidated financial statements required to be delivered under this Section 8.1(d) for such twelve month period as shall be
necessary in order to permit the calculation of the financial covenants set forth in this Agreement; and
(xi) from time to time such additional information regarding the financial position, results of operations, business or prospects of OSG and the Subsidiaries as the Facility Agent, at the request of any Bank, may reasonably request.
(e) Corporate Existence. Do or cause to be done all things necessary to preserve and keep in full force and effect the Borrowers' and each Material Subsidiary's corporate existence, and all licenses, franchises, permits
and assets necessary to the conduct of the business of OSG and the Subsidiaries.
(f) Books and Records. Keep proper books and records throughout the Facility Period.
(g) Inspection. Allow any representative or representatives designated by any Bank, at the risk and expense of such Bank and during normal business hours, subject to applicable laws and regulations, to visit and inspect
any of the Borrowers or Subsidiaries, and, on request, to examine the Borrowers' and Subsidiaries' books of account, records, reports and other papers (and to make copies thereof and to take extracts therefrom) and to discuss their affairs, finances and
accounts with the Borrowers' and Subsidiaries' officers and executive employees all at such reasonable times and as often as such Bank reasonably requests.
(h) Payment of Obligations. Pay and discharge, or cause to be paid and discharged, and will cause each Subsidiary to pay and discharge, at or before maturity, all their respective material obligations and liabilities,
including, without limitation, all taxes, assessments and governmental charges or levies imposed upon them, the Subsidiaries or their respective income or property prior to the date upon which penalties attach thereto; provided, however, that the Borrowers shall not be required to pay and discharge, or cause to be paid and discharged, any such obligation, liability, tax, assessment, charge or levy so long as the legality thereof shall be contested in good
faith and by appropriate proceedings and they or the relevant Subsidiary or Subsidiaries shall maintain in accordance with GAAP appropriate reserves with respect thereto.
(i) Compliance with Agreements, Statutes, etc. Do or cause to be done all things necessary to comply with all material contracts or agreements to which any of the Borrowers or Material Subsidiaries is a party, and all
laws and the rules and regulations thereunder, applicable to the Borrowers or any of the Subsidiaries including, without limitation, those laws, rules and regulations relating to employee benefit plans and environmental matters except where the failure to
do so would not be reasonably likely to result in a Material Adverse Change.
(j) Environmental Matters. Promptly upon the occurrence of any of the following conditions, provide to the Facility Agent (which shall promptly furnish a copy thereof to each Bank) a certificate of an executive officer of
each of the Borrowers, specifying in detail the nature of such condition and their proposed response or the response of their Environmental Affiliates (as hereinafter defined): (i) its receipt or the receipt by any of the Subsidiaries or any of
their Environmental Affiliates of any communication whatsoever that alleges that such Person is not in compliance with any applicable Environmental Law or Environmental Approval, if such noncompliance could reasonably be expected to result in a Material
Adverse Change, (ii) knowledge by it, any of the Subsidiaries or any of their Environmental Affiliates that there exists any Environmental Claim pending or threatened against any such Person, which could reasonably be expected to result in a Material
Adverse Change, or (iii) any release, emission, discharge or disposal of any material that could form the basis of any Environmental Claim against it, any of the Subsidiaries or any of their Environmental Affiliates if such Environmental Claim could
reasonably be expected to result in a Material Adverse Change. Upon the written request by the Facility Agent, each Borrower will submit to the Banks at reasonable intervals, a report providing an update of the status of any issue or claim identified in
any notice or certificate required pursuant to this subsection. For the purposes of this subsection, "Environmental Affiliate" shall mean any Person or entity the liability of which for Environmental Claims OSG or any of the Subsidiaries may have assumed by contract or operation of law.
(k) Maintenance of Assets. Maintain and keep, and procure that each of the Subsidiaries shall maintain and keep, all properties used or useful in the conduct of their respective business in good condition, repair and
working order (ordinary wear and tear excepted) and supplied with all necessary equipment and will make, or cause to be made, all necessary repairs, renewals and replacements thereof so that the business carried on in connection therewith and every
material portion thereof may be properly conducted at all times except where the failure to do so would not be reasonably likely to result in a Material Adverse Change.
(l) Insurance. Maintain, cause each Subsidiary to maintain and use its best efforts to cause each Joint Venture to maintain, with financially sound and reputable insurance companies (which may include protection and
indemnity clubs) (i) in the case of OSG or any Subsidiary or Joint Venture which engages in any shipping or shipping related business or in any business in products related to oil, including without limitation, owning, leasing or chartering any ship
engaged in the transport of oil or related products, oil pollution insurance covering risks in amounts up to and including $1,000,000,000 or, if such insurance is not available at reasonable cost after taking into account the level of exposure to which
OSG, the Subsidiaries and the Joint Ventures may be subject, such other amount as is usually insured against by companies of established repute engaged in the same or similar business from time to time and (ii) such other insurance on all their respective
properties and against all such risks in at least such amounts as are usually insured against by companies of established repute engaged in the same or similar business from time to time.
(m) Shipping Management. At all times cause not less than 66 2/3% of the Consolidated Net Tangible Assets to be managed by OSG, any Subsidiary, the Shipping Manager, any subsidiary of the Shipping Manager, one or more
other shipping management companies reasonably acceptable to the Majority Banks or any combination of the foregoing.
(n) Agent for Service of Process. OSG shall cause OSG International to maintain at all times OSG Ship Management, Inc. or another agent acceptable to the Majority Banks as its agent for service of process in the State of
New York and shall cause any other such agent to execute and deliver to OSG and the Facility Agent a letter accepting such agency, prior to or concurrently with such other agent's acceptance of its appointment as agent for service of process for OSG
International.
(o) Consolidated Tangible Net Worth. At all times maintain Consolidated Tangible Net Worth at an amount not less than $575,000,000, plus 50% of cumulative Consolidated Net Income (to the extent positive) for each fiscal
quarter from and after June 30, 2000.
(p) Cash Adjusted Debt Service Coverage Ratio. At all times maintain a Cash Adjusted Debt Service Coverage Ratio measured as of the end of each fiscal quarter for the period of four consecutive fiscal quarters ended on
that date (taken as a single accounting period) of not less than 1.75 to 1.
(q) Unencumbered Assets to Unsecured Debt Ratio. At all times maintain a ratio of Unencumbered Assets to Unsecured Debt of not less than 1.50 to 1.
(r) Cash Adjusted Funded Debt to Cash Adjusted Consolidated Net Tangible Assets. At all times maintain a ratio of Cash Adjusted Funded Debt to Cash Adjusted Consolidated Net Tangible Assets of not more than .60 to 1.
(s) Security Interest on Ratings Downgrade. (i) Unless the Banks unanimously consent to continue the Facility on an unsecured basis, upon the event of a downgrading of the ratings of OSG's senior unsecured debt (without
third-party credit enhancement) to a combined rating of BB- or lower or BB on Credit Watch with negative outlook, in each case by S&P, and Ba3 or lower by Xxxxx'x, then OSG shall, or shall cause one or more of the Subsidiaries to:
(A) not later than the fifteenth (15th) Banking Day after the occurrence of such ratings downgrade submit to the Documentation Agent for approval by the Banks a list of collateral for the Advances made or to be made
hereunder which it proposes to grant a security interest in, pledge, assign or mortgage to or in favor of the Facility Agent for the benefit of the Creditors, as collateral for the Advances, pursuant to one or more agreements or other instruments to which
OSG (and any relevant Subsidiary) is a party (collectively, "Security Documents"). The list of collateral shall contain a description and valuation of any proposed collateral. Such collateral shall consist of (1) vessels of OSG or any Subsidiary reasonably satisfactory to the Agents (the "
Vessel Collateral"), such Vessel Collateral to be subject to no other Liens (other than Liens arising in the ordinary course of business which (x) do not secure Debt and (y) do not, individually or in the aggregate, materially detract from the value of
the Vessel Collateral as collateral hereunder) and to have an aggregate Fair Market Value (taking into account such Liens) at least equal to 125% of the sum of the aggregate principal amount of all Advances outstanding on such fifteenth (15th) Banking Day; (2) a cash collateral account of OSG or any Subsidiary maintained with the Facility Agent into which OSG or any Subsidiary shall propose to deposit cash in an amount equal to 100% of the sum of the aggregate principal amount of
all Advances outstanding on such fifteenth (15th) Banking Day (the "Cash Collateral") or (3) any combination of Vessel Collateral and Cash Collateral so long as the sum of (x) 80% of the Fair Market Value of any Vessel Collateral plus (y) any Cash Collateral, equals or
exceeds the sum of the aggregate principal amount of all Advances outstanding on such fifteenth (15th) Banking Day. The Documentation Agent shall notify OSG in writing as to whether the proposed collateral is acceptable to the Banks on or prior to the fifteenth (15th) Banking Day following its receipt of the list of proposed collateral from
OSG. On or prior to the fifteenth (15th) Banking Day following its receipt of such notice from the Documentation Agent, OSG shall grant a security interest in, pledge, assign or mortgage to or in favor of the Facility Agent for the benefit of the Banks
any such collateral as the Banks shall have approved pursuant to one or more Security Documents (such day, the "Collateral Date"). In the event the Banks do not find the proposed collateral to be reasonably acceptable, OSG shall propose alternative collateral on or prior to the fifteenth (15th) Banking Day following its receipt of the notice from the
Documentation Agent. It shall constitute an Event of Default if the Banks shall fail to find such substitute collateral reasonably acceptable;
(B) on the Collateral Date, provide to the Documentation Agent one or more opinions of counsel, the form and substance of each such opinion and such counsel to be reasonably satisfactory in the opinion of the Documentation Agent, as
to the creation, validity, effectiveness, perfection and priority of such security interests, pledges, assignments and mortgages, compliance with Regulation U, the absence of any fraudulent conveyance or transfer and such other matters as the
Documentation Agent may reasonably request; and
(C) amend or modify this Agreement, pursuant to one or more amendments or modifications in form and substance satisfactory to the Documentation Agent, to the extent necessary or desirable, in the reasonable judgment of the
Documentation Agent, to take into account the Security Documents entered into in accordance with this Section 8.1(s) and such security interests, pledges, assignments and mortgages and such other matters related thereto as the Documentation Agent may
reasonably request, such amendments and modifications to include, without limitation, one or more representations and warranties, covenants, events of default and indemnities relating to the subject matter addressed in clauses (A) and (B) above,
or the Security Documents, opinions or other writings referred to therein. In order for OSG to satisfy its obligations under this Section 8.1(s) and without limiting the provisions set forth above, the assets constituting Vessel Collateral
hereunder, the determination of the Fair Market Value thereof and the form and substance of the Security Documents, the opinions referred to in clause (B) above and the amendments and modifications referred to in clause (C) above must each be
satisfactory in form and substance to the Documentation Agent, and OSG must have received a certificate signed by the Documentation Agent stating that OSG has complied with its obligations under this Section 8.1(s); provided that, in the event the entity which is the Documentation Agent is no longer a Bank at the time the Borrowers become obligated to grant a security interest in, pledge, assign or mortgage collateral for the Advances under this Section
8.1(s), the Majority Banks may appoint one of the Banks as Documentation Agent to replace the then existing Documentation Agent.
(ii) At all times after the Collateral Date, the sum of (x) 80% of the Fair Market Value of any Vessel Collateral plus (y) any Cash Collateral, shall be at least equal to the aggregate principal amount of all Advances outstanding
hereunder from time to time. In the event the sum of (A) 71.429% of the Fair Market Value of any Vessel Collateral plus (B) any Cash Collateral, exceeds the aggregate principal amount of all Advances then outstanding hereunder, the Borrowers may
withdraw Vessel Collateral, Cash Collateral or any combination of Vessel Collateral and Cash Collateral, in each case so long as the collateral to be released is reasonably acceptable to the Agents and so long as the sum of (A) 71.429% of the Fair Market
Value of any remaining Vessel Collateral plus (B) any remaining Cash Collateral, equals or exceeds the aggregate principal amount of all Advances outstanding hereunder following any such release of collateral.
(iii) In the event OSG is no longer required under the indentures relating to its senior unsecured indebtedness to continue to have such indebtedness rated, the Borrowers shall, on or prior to the 120th day after the
expiration of OSG's credit ratings (A) and annually thereafter until the Final Payment Date, deliver to the Facility Agent, with sufficient copies for the Banks, a letter from either S&P or Xxxxx'x providing a rating of the Facility as BB or better,
in the case of S&P, or as Ba2 or better, in the case of Xxxxx'x, or (B) and upon any failure to deliver a letter rating in accordance with (A) above, provide collateral in accordance with the provisions of subsections (i) and (ii) above.
(t) Ownership of OSG Bulk and OSG International. In respect of OSG only, cause OSG Bulk and OSG International to be direct or indirect wholly-owned Subsidiaries (excluding only directors' qualifying shares).
(u) Exchange Listing. In respect of OSG only, remain listed on the New York Stock Exchange, NASDAQ or such other exchange as is satisfactory to the Banks.
(v) Book Value. At all times use valuation procedures to determine Book Value which are consistent with GAAP.
8.2. Negative Covenants.
Each of the Borrowers hereby covenants and undertakes with each of the Banks that, from the date hereof and so long as the Commitments are in effect or any principal, interest or other moneys are owing in respect of the Facility or
otherwise owing under this Agreement or the Notes or any of them, the Borrowers, without the prior written consent of the Majority Banks (or the Facility Agent acting with the written consent of the Majority Banks):
(a) Limitation on Secured Debt. Will not, and will not permit any Recourse Subsidiary to, create, assume, incur or in any manner become liable in respect of any Secured Debt unless immediately after giving effect thereto
and to the application of the proceeds thereof, (i) the ratio of Unencumbered Assets to Unsecured Debt shall not be less than 1.50 to 1 and (ii) the ratio of Collateralized Assets to Consolidated Net Tangible Assets shall not exceed .25 to 1.
(b) Limitations on Funded Debt. Will not, and will not permit any Recourse Subsidiary to, create, assume or incur or in any manner be or become liable in respect of any Funded Debt, except:
(i) Funded Debt of OSG and the Recourse Subsidiaries outstanding as of December 31, 1999 as the same is set forth on Schedule III attached hereto;
(ii) Funded Debt of OSG and the Recourse Subsidiaries; provided, however, that at the time of issuance thereof and immediately after giving effect thereto the Borrowers shall be in compliance with Section 8.1(r);
(iii) Renewals, extensions or refundings of Funded Debt referred to in Section 8.2(b)(i) or incurred pursuant to the provisions of Section 8.2(b)(ii), without increase in the ranking or priority thereof or principal amount
thereof; provided, that in the case of any refunding of any such Funded Debt, the newly issued Funded Debt shall have a weighted average life to maturity at least equal to the remaining weighted average life to maturity of the Funded Debt being refunded; and
(iv) Funded Debt under the Facility.
(c) Conduct of Business. Will not, and will not permit any Recourse Subsidiary to, acquire any Operating Assets or make any Investment in Operating Assets unless, after giving effect to such acquisition or Investment at
least 70% (based on the most recent consolidated balance sheet of OSG and the Recourse Subsidiaries required to be provided pursuant to Section 8.1(d)) of the Operating Assets of OSG and the Recourse Subsidiaries are (on a consolidated basis) in Shipping
and Related Businesses; provided, however, that the foregoing shall not limit or restrict the acquisition of assets to be used in the Shipping and Related Businesses of OSG and the Recourse Subsidiaries or of any equity interest in any Person engaged primarily in
Shipping and Related Businesses.
(d) Limitation on Sale and Leasebacks. Will not, and will not permit any Recourse Subsidiary to, enter into any Sale and Leaseback Transaction unless either:
(i) after giving effect to such Sale and Leaseback Transaction, the ratio of Unencumbered Assets to Unsecured Debt shall be not less than 1.50 to 1; or
(ii) the proceeds of the sale of the assets to be leased are at least equal to their fair market value and such proceeds are applied (or committed to be applied within 24 months of receipt thereof pursuant to a binding written
contract) to (A) the purchase, acquisition or construction of assets to be used in the business of OSG and the Subsidiaries or (B) retire Funded Debt; provided that the percentage of proceeds, if any, applied to pay Subordinated Funded Debt shall not exceed the percentage which Subordinated Funded Debt represents of Consolidated Funded Debt. Pending the actual application of such proceeds for
the purposes described in clauses (A) or (B) above, such proceeds shall be held by OSG or the relevant Subsidiary in Permitted Investments.
(e) Mergers, Consolidations and Sales of Assets.
(i) (A) Will not, and will not permit any Material Subsidiary to, consolidate with or be a party to a merger with any other Person or (B) sell, lease (other than chartering in the ordinary course of business, which shall not
include bareboat chartering for periods in excess of ten (10) years) or otherwise dispose of all or substantially all of the assets of OSG and the Subsidiaries, taken as a whole; provided, however, that OSG or any Subsidiary may consolidate or merge with any other Person if (A) at the time of such transaction and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing, and
(B) the surviving entity in such consolidation or merger shall have assumed all liabilities and obligations of the parties thereto; and provided further, that OSG or any Recourse Subsidiary may consolidate or merge with any Recourse Subsidiary, in the case of OSG, or OSG or any other Recourse Subsidiary, in the case of a Recourse Subsidiary.
(ii) In addition to the restrictions contained in Section 8.2(e)(i) OSG will not, and will not permit any Recourse Subsidiary to, sell, lease or otherwise dispose of (other than in the ordinary course of business) any Substantial
Part (as defined in Section 8.2(e)(iii)) of the assets of OSG and the Subsidiaries, taken as a whole (including the creation of Minority Interests); provided that any Subsidiary may sell, lease or otherwise dispose of all or substantially all of its assets to OSG or a wholly-owned Subsidiary. For the purposes of any determination under this Section 8.2(e)(ii), a sale or other disposition of
assets of OSG and the Subsidiaries shall include, but not be limited to, the creation of any Minority Interests and any other sale, transfer or other disposition of the capital stock or assets of any Subsidiary (other than to OSG or a wholly-owned
Subsidiary) including any merger, consolidation or sale of all or substantially all of the assets of any Subsidiary if the surviving or continuing or acquiring corporation is not a Subsidiary.
(iii) As used in this Section 8.2(e), a sale, lease or other disposition of assets shall be deemed to be a "Substantial Part" of the assets of OSG and the Recourse Subsidiaries, taken as a whole, if the Book Value of such
assets, when added to the Book Value of all other assets sold, leased or otherwise disposed of by OSG and the Subsidiaries (other than in the ordinary course of business) during the 12-month period ending with the date of such sale, lease or other
disposition, exceeds 15% of Consolidated Net Tangible Assets, determined as of the end of the immediately preceding fiscal quarter. For the purposes of any determination of "Substantial Part" under this Section 8.2(e), a Qualified Joint Venture
Transaction shall not be deemed a sale, lease or other disposition of assets by OSG and the Subsidiaries. A "Qualified Joint Venture Transaction" shall mean a contribution of property by OSG or a Subsidiary to a Joint Venture which, in the good faith judgment of the Board of Directors of OSG, is substantially equivalent in value to the property
contributed by the other co-venturers in such Joint Venture whereunder (A) there are one or more co-venturers other than OSG or a Subsidiary and (B) OSG or a Subsidiary maintains at least a 50% equity interest and exercises (and is entitled to
exercise) at least equivalent control of the management and administration of such Joint Venture as the co-venturers exercise (and are entitled to exercise).
For the purpose of making any determination of "Substantial Part," sales, leases and other dispositions of assets of OSG and its Subsidiaries shall not be included if the net proceeds are within twenty-four (24) months after such
sale either (1) committed to be used pursuant to a binding written contract to purchase or construct other assets that are used in the business of OSG and its Subsidiaries or (2) used to pay or prepay Funded Debt; provided that the percentage of proceeds, if any, applied to pay Subordinated Funded Debt shall not exceed the percentage which Subordinated Funded Debt represents of Consolidated Funded Debt; provided further that pending the actual
application of such proceeds for the purposes described in clause (1) or (2) above, such net proceeds shall be invested only in Permitted Investments.
(f) Transactions with Affiliates. Will not, and will not permit any Recourse Subsidiary to, enter into or become a party to any material transaction or arrangement with any Affiliate (including, without limitation, the
purchase from, sale to, or exchange of property with, or the rendering of any service by or for, any Affiliate), except pursuant to the reasonable requirements of OSG's or such Subsidiary's business and upon terms which are fair and reasonable and in the
best interests of OSG or such Subsidiary.
(g) Use of Proceeds. Will not use the proceeds of the Advances in violation of Regulation T, U or X.
(h) Maximum Investments in Joint Ventures. Will not, and will not permit any Recourse Subsidiary to, make any Investment in any Joint Venture on any date if, immediately after giving effect to such Investment, the
aggregate amount of all such Investments made by OSG and the Recourse Subsidiaries after December 31, 1999 would exceed 22.5% of Consolidated Net Tangible Assets based on the most recent consolidated balance sheet of OSG and the Recourse Subsidiaries
required to be provided pursuant to Section 8.1(d).
(i) No Competing Offering. Until the earlier of (a) 30 days following the Closing Date, or (b) the date each Bank which is an Agent shall have reduced its Commitment to $40,000,000 or such greater amount as may be
acceptable to each Agent, will not commence or permit any of their respective Affiliates or anyone acting on any of their behalf to commence any competing offering, placement or arrangement of any debt securities or bank financing.
9. EVENTS OF DEFAULT
9.1. Events of Default.
In the event that any of the following events shall occur and be continuing:
(a) Principal Payments. Any principal of the Advances is not paid on the due date therefor; or
(b) Interest and other Payments. Any interest on the Advances or any other amount becoming payable under this Agreement and under the Notes or under any of them, is not paid within three (3) Banking Days from the date
when due; or
(c) Representations, etc. Any representation, warranty or other statement made by the Borrowers in this Agreement or in any other instrument, document or other agreement delivered in connection herewith proves to have
been untrue or misleading in any material respect as at the date as of which it was made; or
(d) Impossibility, Illegality. It becomes impossible or unlawful for the Borrowers to fulfill any of the covenants and obligations contained herein or in the Notes, or (in the event of any illegality which arises solely
as a result of the domicile of any Bank and the Borrower fails to obtain a Replacement Bank in accordance with Section 11.8 within thirty (30) days thereof) for any of the Banks to exercise any of the rights vested in any of them hereunder or under
the Notes and such impossibility or illegality, in the reasonable opinion of such Bank, will have a material adverse effect on any of its rights hereunder or under the Notes or on any of its rights to enforce any thereof; or
(e) Certain Covenants. One or more of the Borrowers default in the performance or observance of any covenant contained in Section 8.1(b), 8.1(d)(v), 8.1(k), 8.1(l), 8.1(o) through 8.1(s), 8.2(a) through 8.2(e), 8.2(h) and
8.2(i); or
(f) Covenants. One or more of the Borrowers default in the performance of any term, covenant or agreement contained in this Agreement or in the Notes, or in any other instrument, document or other agreement delivered in
connection herewith or therewith, in each case other than an Event of Default referred to elsewhere in this Section 9.1, and such default continues unremedied for a period of fifteen (15) days after written notice thereof has been given to the
Borrowers by the Facility Agent at the request of any Bank; or
(g) Indebtedness and Other Obligations. There occurs any Event of Default (as such term is defined in the Existing Credit Facility) or event which, with the giving of notice or passage of time or both, would constitute
such an Event of Default under the Existing Credit Facility which is continuing or OSG or any Recourse Subsidiary defaults under (i) any Material Financial Obligation or (ii) any other material contract or agreement to which it is a party or by which it
is bound and, in the case of this (ii), such default could reasonably be expected to result in a Material Adverse Change; or
(h) Bankruptcy. Any of the Borrowers or Material Subsidiaries commences any proceedings relating to any substantial portion of its property under any reorganization, arrangement or readjustment of debt, dissolution,
winding up, adjustment, composition, bankruptcy or liquidation law or statute of any jurisdiction, whether now or hereafter in effect (a "Proceeding"), or there is commenced against any thereof any Proceeding and such Proceeding remains undismissed or unstayed for a period of sixty (60) days; or any receiver, trustee, liquidator or sequestrator of, or for, any thereof or any
substantial portion of the property of any thereof is appointed and is not discharged within a period of sixty (60) days; or any thereof by any act indicates consent to or approval of or acquiescence in any Proceeding or to the appointment of any
receiver, trustee, liquidator or sequestrator of, or for, itself or any substantial portion of its property; or
(i) Judgments. Any judgment or order is made the effect whereof would be to render invalid this Agreement or the Notes or any material provision thereof or any Borrower asserts that any such agreement or provision thereof
is invalid; or judgments or orders for the payment of money in excess of $10,000,000 in the aggregate for OSG and all Subsidiaries (or its equivalent in any other currency) shall be rendered against OSG and/or any Subsidiary and such judgments or orders
shall continue unsatisfied and unstayed for a period of 30 days; or
(j) Inability to Pay Debts. Any Borrower or Material Subsidiary is unable to pay or admits its inability to pay its debts as they fall due or a moratorium shall be declared in respect of any Indebtedness of any thereof; or
(k) ERISA Debt. Any member of the ERISA Group or any ERISA Affiliate shall (i) fail to pay when due an amount or amounts aggregating in excess of $5,000,000 which it or they shall have become liable to pay under
Title IV of ERISA or (ii) any member of the ERISA Group or any ERISA Affiliate, individually or collectively, shall incur, or shall reasonably expect to incur, any Withdrawal Liability or liability upon the happening of a Termination Event and
the aggregate of all such Withdrawal Liabilities and such other liabilities shall be in excess of $30,000,000;
then, the Banks' obligation to make the Facility available shall cease and the Facility Agent on behalf of the Banks may, with the Majority Banks' consent and shall, upon the Majority Banks' instruction, by notice to the Borrowers,
declare the entire Facility Balance, accrued interest and any other sums payable by the Borrowers hereunder and under the Notes due and payable whereupon the same shall forthwith be due and payable without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived; provided that upon the happening of an event specified in subclauses (h) or (j) of this Section 9.1, the Facility Balance, accrued interest and any other sums payable by the Borrowers hereunder and under the Notes shall be immediately due
and payable without declaration, presentment, demand, protest or other notice to the Borrowers all of which are expressly waived. In such event, the Creditors may proceed to protect and enforce their rights by action at law, suit in equity or in
admiralty or other appropriate proceeding, whether for specific performance of any covenant contained in this Agreement or in the Notes or in aid of the exercise of any power granted herein or therein, or the Banks or the Facility Agent may proceed to
enforce the payment of the Notes when due or to enforce any other legal or equitable right of the Banks, or proceed to take any action authorized or permitted by Applicable Law for the collection of all sums due, or so declared due, including, without
limitation, the right to appropriate and hold or apply (directly, by way of set-off or otherwise) to the payment of the obligations of the Borrowers to any of the Creditors hereunder and/or under the Notes (whether or not then due) all moneys and other
amounts of the Borrowers then or thereafter in possession of any Creditor, the balance of any deposit account (demand or time, matured or unmatured) of the Borrowers then or thereafter with any Creditor and every other claim of the Borrowers then or
thereafter against any of the Creditors.
9.2. Indemnification.
The Borrowers jointly and severally, agree to, and shall, indemnify and hold harmless each of the Creditors against any loss or reasonable costs or expenses (including legal fees and expenses) which any of the Creditors sustains or
incurs as a consequence of any default in payment of the principal amount of the Advances or interest accrued thereon or any other amount payable hereunder or under the Notes, including, but not limited to, all actual losses incurred in liquidating or
re-employing fixed deposits made by third parties or funds acquired to effect or maintain the Advances or any part thereof. A Creditor's certification of such costs and expenses shall, absent any manifest error, be conclusive and binding on the Borrowers.
9.3. Application of Moneys.
All moneys received by any of the Creditors under or pursuant to this Agreement or the Notes after the happening of any Event of Default shall be applied by the Facility Agent in the following manner:
(a) firstly, in or towards the payment or reimbursement of any expenses or liabilities incurred by any of the Creditors in connection with the ascertainment, protection or enforcement of its rights and remedies hereunder and
under the Notes;
(b) secondly, in or towards payment of any interest owing in respect of the Advances;
(c) thirdly, in or towards repayment of the Advances;
(d) fourthly, in or towards payment of all other sums which may be owing to any of the Creditors under this Agreement or under the Notes; and
(e) fifthly, the surplus (if any) shall be paid to the Borrowers or to whomsoever else may be entitled thereto.
10. ASSIGNMENTS; PARTICIPATIONS; PLEDGES
10.1. Assignments.
(a) This Agreement shall be binding upon, and inure to the benefit of, the Borrowers and each of the Creditors and their respective successors and assigns, except that the Borrowers may not assign any of their rights or obligations
hereunder without the prior written consent of the Banks. Any Bank may assign all or part of its rights and obligations under this Agreement to any one or more financial institutions approved by the Agents and the Borrowers, which approval shall not be
unreasonably withheld; provided, however, that no such consent shall be required if the assignee is immediately prior to such assignment another Bank or an Affiliate of the assigning Bank (the expenses of any Bank in connection with any such assignment shall be
for its own account); provided, further that no Borrower shall be required to pay any amount under Sections 6.1 or 11 that is greater than the amount which it would have been required to pay had no such assignment been made; provided, further that
any assignment shall be made pursuant to an Assignment and Assumption Agreement substantially in the form of Exhibit B hereto; and provided, finally, that, in the case of a partial assignment by any Bank of its rights and obligations hereunder, unless such assignment is to another Bank or an Affiliate of a Bank, the minimum amount which may be assigned shall be
$5,000,000 and, after giving effect to any such assignment, each such assigning Bank's pro rata portion of the Commitments and Advances shall aggregate not less than $10,000,000 unless, in each case, otherwise agreed by the Borrowers and the Facility
Agent. The Borrowers will take all reasonable actions requested by the Banks to effect any such assignment, including, without limitation, the execution of a written consent to such Assignment and Assumption Agreement.
(b) Notwithstanding the foregoing, any Bank may at any time assign all or any portion of its rights under this Agreement and the Notes to a Federal Reserve Bank to secure extensions of credit by such Federal Reserve Bank to such
Bank; provided that no such assignment shall release a Bank from any of its obligations hereunder or substitute any such Federal Reserve Bank for such Bank as a party hereto.
10.2. Participations.
Any Bank may at any time sell to one or more commercial banks or other financial institutions (each of such commercial banks and other financial institutions being herein called a "Participant") participating interests in any of
the Advances, its Commitment or other interests of such Bank hereunder; provided, however, that
(a) no participation contemplated in this Section 10.2 shall relieve such Bank from its Commitment or its other obligations hereunder;
(b) such Bank shall remaining solely responsible for the performance of its Commitment and such other obligations;
(c) no Participant, unless such Participant is an Affiliate of such Bank, shall be entitled to require such Bank to take or refrain from taking any action hereunder, except that such Bank may agree with any Participant that such
Bank will not, without such Participant's consent, approve any amendment or waiver of any provision of this Agreement or any Note, or consent to any departure by the Borrowers therefrom, if any such amendment, waiver or consent would require the
affirmative consent of such Bank pursuant to the terms hereof; and
(d) no Borrower shall be required to pay any amount under Sections 6.1 or 11 that is greater than the amount which it would have been required to pay had no participating interest been sold.
10.3. Promissory Notes.
In order to facilitate assignments and participations hereunder, the Borrowers shall, at the request of any Bank assigning or selling participating interests in all or any portion of its rights under this Agreement and its Note pursuant
to Section 10.1 or 10.2, duly execute and deliver to such Bank a promissory note or notes evidencing the portion of the Facility Balance owing by the Borrowers to such Bank hereunder.
10.4. Security Interest.
Notwithstanding any other provision set forth in this Agreement, any Bank or Participant may at any time create a security interest in all or any portion of its rights under this Agreement, including, without limitation, the Advances
owing to it and the Note held by it.
11. ILLEGALITY, INCREASED COST, NON-AVAILABILITY, ETC.
11.1. Illegality.
In the event that by reason of any change in any applicable law, regulation or regulatory requirement or in the interpretation or application thereof by any authority, a Bank or Participant has a reasonable basis to conclude that it has
become unlawful for such Bank or Participant to maintain or give effect to its obligations as contemplated by this Agreement, such Bank or Participant shall inform the Borrowers and the Facility Agent to that effect, whereafter the liability of such Bank
or Participant to make its Commitment available shall forthwith cease and the Borrowers shall be required to repay to such Bank or Participant that portion of the Facility Balance advanced by such Bank or Participant immediately. In any such event, but
without prejudice to the aforesaid obligations of the Borrowers to prepay the relevant portion of the Facility Balance, the Borrowers and such Bank or Participant shall negotiate in good faith with a view to agreeing on terms for making the Commitment
available from another jurisdiction or otherwise restructuring the Commitment on a basis which is not unlawful.
11.2. Increased Cost.
If any change in applicable law, regulation or regulatory requirement or in the interpretation or application thereof by any Authority shall:
(a) subject any Bank or Participant to any Taxes; or
(b) change the basis of taxation to any Bank or Participant of payments of principal or interest or any other payment due or to become due pursuant to this Agreement (other than a change in the basis effected by the United States
of America, the State or The City of New York or any governmental subdivision or other taxing authority having jurisdiction over such Bank or Participant (unless such jurisdiction is asserted solely by reason of the activities of OSG or any Subsidiary) or
such other jurisdiction where the Advances may be payable); or
(c) impose, modify or deem applicable any reserve or capital adequacy requirements or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans
by, any Bank or Participant; or
(d) impose on any Bank or Participant any other condition affecting the Facility or any part thereof;
and the result of the foregoing is either to increase the cost to such Bank or Participant of making available or maintaining the Facility or any part thereof or to reduce the rate of return on assets or equity of such Bank or
Participant or the amount of any payment received by such Bank or Participant, then and in any such case if such increase or reduction in the opinion of such Bank or Participant materially affects the interests of such Bank or Participant under or in
connection with this Agreement:
(i) such Bank or Participant shall notify the Borrowers and the Facility Agent in writing of the happening of such event;
(ii) the Borrowers agree forthwith upon receipt of notice from such Bank or Participant as aforesaid to pay to such Bank or Participant such amount as such Bank or Participant certifies to be necessary to compensate such Bank or
Participant for such additional cost or such reduction.
Any such notice referred to in subsections (i) and (ii) of this Section 11.2 may be made by a Bank or Participant at any time before or within one (1) year after any repayment of the Facility Balance; provided, however
, that before making any such demand, such Bank agrees to use its best efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different lending office if the making of such designation would avoid the need for,
or reduce the amount of, such increased cost or such reduction and would not, in the judgment of such Bank, be otherwise disadvantageous to such Banks.
11.3. Nonavailability of Funds.
If the Facility Agent shall determine that, by reason of circumstances affecting the London Interbank Market generally, adequate and reasonable means do not or will not exist for ascertaining the Applicable Rate for any Advance for any
Interest Period, the Facility Agent shall give notice of such determination to the Borrowers and the Banks. The Borrowers and the Facility Agent, acting in accordance with the instruction of the Banks, shall then negotiate in good faith in order to agree
upon a mutually satisfactory interest rate and/or Interest Period to be substituted for those which would otherwise have applied under this Agreement. If the Borrowers and the Facility Agent are unable to agree upon such a substituted interest rate
and/or Interest Period within thirty (30) days of the giving of such determination notice, the Facility Agent shall set an interest rate and Interest Period to take effect from the expiration of the Interest Period in effect at the date of
determination, which rate shall be equal to the Applicable Margin plus the cost to the Banks and Participants (as certified by each Bank and Participant) of funding such Advance. In the event the state of affairs referred to in this Section 11.3
shall extend beyond the end of any Interest Period, the foregoing procedure shall continue to apply until circumstances are such that the Applicable Rate may be determined pursuant to Section 5.
11.4. Determination of Losses.
A certificate or determination notice of the Facility Agent or any affected Bank or Participant, as the case may be, as to any of the matters referred to in this Section 11 shall, absent manifest error, be conclusive and binding on the Borrowers.
11.5. Compensation for Losses.
Where any portion of the Facility Balance is to be prepaid by the Borrowers pursuant to Section 11.1 the Borrowers agree simultaneously with such prepayment to pay to the affected Bank or Participant all accrued interest to the
date of actual payment and all other sums payable by the Borrowers to such Bank or Participant pursuant to this Agreement together with such amounts as may be certified by such Bank or Participant to be necessary to compensate such Bank or Participant for
any actual loss, premium or penalties incurred or to be incurred by it on account of funds borrowed to make, fund or maintain its portion of the Facility Balance for the remainder (if any) of the then current Interest Period or Periods, but otherwise without penalty or premium.
11.6. Compensation for Breakage Costs.
The Borrowers shall pay to the Banks, Participants or any thereof, upon the request of any thereof such amount or amounts as shall be sufficient (in the reasonable opinion of the relevant Banks and/or Participants) to compensate
them for any loss, cost or expense incurred by them as a result of:
(a) any payment or prepayment (including any such prepayment made pursuant to Sections 4.2 and 9.1) of an Advance on a date other than the last day of an Interest Period for such Advance; or
(b) any failure by the Borrowers to borrow (including without limitation any such failure resulting from a condition precedent set forth in Section 3) or prepay an Advance held by any Banks and/or Participants on the date for
such borrowing or prepayment specified in the relevant request for such Advance or notice of prepayment delivered under Sections 2.2 or 4.2, respectively;
such compensation to include, without limitation, an amount equal to the excess, if any, of (i) the amount of interest which would have accrued on the principal amount so paid, prepaid or not borrowed for the period from the date
of such payment, prepayment or failure to borrow to the last day of the then current Interest Period for such Advance or, in the case of a failure to borrow, the Interest Period for such Advance which would have commenced on the date of such failure to
borrow, in each case at the applicable rate of interest for such Advance provided for herein over (ii) the amount of interest which otherwise would have accrued on such principal amount at a rate per annum equal to the interest component (as
reasonably determined by the relevant Banks and/or Participants) of the amount (as reasonably determined by such Banks and/or Participants) the Banks and/or Participants would have bid in the Eurocurrency market for Dollar deposits of amounts comparable
to such principal amount and maturities comparable to such Interest Period. Any certification of a relevant Bank or Participant shall, absent manifest error, be conclusive and binding on the Borrowers as to the extent of any such losses.
11.7. Currency Indemnity.
(a) If for the purpose of obtaining or enforcing a judgment in any court in any country it becomes necessary to convert into any other currency (the "judgment currency") an amount due in Dollars under this Agreement or the
Notes, then the conversion shall be made, in the discretion of the Facility Agent, at the rate of exchange prevailing either on the date of default or on the day before the day on which the judgment is given or the order for enforcement is made, as the
case may be (the "Conversion Date"); provided that the Facility Agent shall not be entitled to recover under this clause any amount in the judgment currency which exceeds at the Conversion Date the amount in Dollars due under this Agreement and/or the Notes.
(b) If there is a change in the rate of exchange prevailing between the Conversion Date and the date of actual payment of the amount due, the Borrowers shall pay such additional amounts (if any, but in any event not a lesser
amount) as may be necessary to ensure that the amount paid in the judgment currency when converted at the rate of exchange prevailing on the date of payment will produce the amount then due under this Agreement and/or the Notes, in Dollars; any excess
over the amount due received or collected by the Creditors and Participants shall be remitted to the Borrowers.
(c) Any amount due from the Borrowers under Section 11.7(b) shall be due as a separate debt and shall not be affected by judgment being obtained for any other sums due under or in respect of this Agreement and/or the Notes.
(d) The term "rate of exchange" in this Section 11.7 means the rate at which the Facility Agent in accordance with its normal practices is able on the relevant date to purchase Dollars with the judgment currency and includes
any premium and costs of exchange payable in connection with such purchase.
11.8. Replacement of Bank or Participant.
If the obligation of any Bank to make its pro rata share of any Advance has been suspended or terminated pursuant to Section 11.1, or if any Bank shall notify the Borrowers of the happening of any event leading to
increased costs as described in Section 11.2, the Borrowers shall have the right, upon twenty (20) Banking Days' prior written notice to such Bank, to cause one or more banks (a "Replacement Bank(s)") (which may be one or more of the Banks), each such Replacement Bank to be reasonably satisfactory to the Majority Banks (determined for this purpose as if such transferor Bank had no Commitment and held no interest in the Note
issued to it hereunder) and, in each case, with the written acknowledgment of the Facility Agent, to purchase such Bank's pro rata share of the Advances and assume the Commitment of such Bank pursuant to an Assignment and Assumption Agreement. If one or more such banks are identified by the Borrowers and approved as being reasonably satisfactory to the
Majority Banks (determined as provided above), the transferor Bank shall consent to such sale and assumption by executing and delivering an Assignment and Assumption Agreement. Upon execution and delivery of an Assignment and Assumption Agreement by the
Borrowers, the transferor Bank, the Replacement Bank and the Facility Agent, and payment by the Replacement Bank to the transferor Bank of an amount equal to the purchase price agreed between such transferor Bank and such Replacement Bank, such
Replacement Bank shall become a Bank party to this Agreement (if it is not already a party hereto as applicable) and shall have all the rights and obligations of a Bank with a Commitment (which, if such Replacement Bank is already a party hereto, shall
take into account such Replacement Bank's then existing Commitment hereunder) as set forth in such Assignment and Assumption Agreement and the transferor Bank shall be released from its obligations hereunder and no further consent or action by any other
Person shall be required. In the event that the Facility Agent, in its capacity as a Bank, is required to sell its pro rata share of the Advances and its Commitment hereunder pursuant to this Section 11.8, the Facility Agent shall, promptly upon the consummation of any assignment pursuant to this Section 11.8, resign as Facility Agent hereunder
and the Borrowers shall (subject to the consent of the Majority Banks) have the right to appoint another Agent as successor Facility Agent, all in accordance with Section 14.8.
12. FEES, EXPENSES AND INDEMNIFICATION
12.1. Commitment Fee.
OSG shall pay the Facility Agent (for the account of the Banks) a commitment fee, which fee shall be a per annum percentage which will vary based on the rating level assigned to OSG's senior unsecured debt without third party credit
enhancement by S&P and Xxxxx'x, as per the grid set forth in Schedule II (the "Commitment Fee"), on the undrawn portion of the Facility, accruing from February 11, 2000, which shall be payable during the Facility Period quarterly in arrears beginning June 30, 2000 and on the day on which the Commitments terminate. Such
Commitment Fee shall accrue from day to day and be calculated on the basis of actual days elapsed over a 365/366 day year.
12.2. Expenses.
The Borrowers jointly and severally agree, whether or not the transactions hereby contemplated are consummated, on demand to pay, or reimburse the Agents for the payment of the reasonable, documented expenses of the Agents and (after
the occurrence and during the continuance of an Event of Default) the Banks incident to said transactions (and in connection with any supplements, amendments, waivers or consents relating thereto or incurred in connection with the enforcement or defense
of any of the Agents' and the Banks' rights or remedies with respect thereto) including, without limitation, all reasonable costs and expenses of preparation, negotiation, execution and administration of this Agreement and the documents referred to
herein, the reasonable fees and disbursements of the Agents' counsel in connection therewith, as well as reasonable travelling expenses of the Agents, the reasonable fees and expenses of any independent appraisers, surveyors, engineers and other
consultants retained by the Agents in connection with this transaction, all reasonable costs and expenses, if any, in connection with the enforcement of this Agreement and the Notes and stamp and other similar taxes, if any, incident to the execution and
delivery of the documents (including, without limitation, the Notes) herein contemplated and to hold the Creditors free and harmless in connection with any liability arising from the nonpayment of any such stamp or other similar taxes. Such taxes and, if
any, interest and penalties related thereto as may become payable after the date hereof shall be paid immediately by the Borrowers to the Agents or the Banks, as the case may be, when liability therefor is no longer contested by such party or parties or
reimbursed immediately by the Borrowers to such party or parties after payment thereof (if the Agents or the Banks, in their sole discretion, choose to make such payment). The Borrowers also jointly and severally agree, whether or not the transactions
hereby contemplated are consummated, on demand to pay, or reimburse the Syndication Agent for all reasonable costs, charges and out-of-pocket expenses incurred by the Syndication Agent in connection with the syndication of the Facility.
12.3. Indemnification.
Neither any Creditor nor any of its directors, officers, agents or employees shall be liable to the Borrowers for any action taken or not taken by it in connection herewith in the absence of its own gross negligence or willful
misconduct. The Borrowers hereby jointly and severally agree to indemnify the Creditors, their respective affiliates and the respective directors, officers, agents and employees of the foregoing (each an "Indemnitee") and hold each Indemnitee harmless from and against any and all liabilities, losses, damages, costs and expenses of any kind, including, without limitation, the reasonable fees and disbursements of counsel, which may be incurred by such
Indemnitee in connection with any investigative, administrative or judicial proceeding (whether or not such Indemnitee shall be designated a party thereto) brought or threatened relating to or arising out of this Agreement, any actual or proposed use of
proceeds of Advances hereunder, or any related transaction or claim; provided that (i) no Indemnitee shall have the right to be indemnified hereunder for such Indemnitee's own gross negligence or willful misconduct as determined by a court of competent jurisdiction and (ii) to the extent permitted by law, the
Indemnitee shall provide the Borrowers with prompt notice of any such investigative, administrative or judicial proceeding after the Indemnitee becomes aware of such proceeding; provided, however, that the Indemnitee's failure to provide such notice in a timely manner shall not relieve the Borrowers of their obligations hereunder.
13. APPLICABLE LAW, JURISDICTION AND WAIVER
13.1. Applicable Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
13.2. Jurisdiction.
Each of the Borrowers hereby irrevocably submits to the jurisdiction of the courts of the State of New York and of the United States District Court for the Southern District of New York in any action or proceeding brought against it by
any Creditor under this Agreement or any instrument delivered hereunder and hereby agrees that service of summons or other legal process thereon may be made by serving a copy of the summons or other legal process in any such action or proceeding (i)
on OSG or OSG Bulk by mailing or delivering the same by hand to OSG or OSG Bulk, as the case may be, at the address indicated for notices in Section 15 or, (ii) in the case of OSG International, on OSG Ship Management, Inc., 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 by mailing or delivering the same by hand at its address. The service, as herein provided, of such summons or other legal process in any such action or proceeding shall be deemed personal service and accepted by the Borrowers as
such, and shall be legal and binding upon the Borrowers for all purposes of any such action or proceeding. Final judgment (a certified or exemplified copy of which shall be conclusive evidence of the fact and of the amount of any indebtedness of the
Borrowers to any of the Creditors) against the Borrowers in any such legal action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment. In the event that any of the Borrowers shall not be conveniently
available for such service, each Borrower hereby irrevocably appoints the Person who then is the Secretary of State of the State of New York as its attorney-in-fact and agent. The Borrowers will advise the Facility Agent promptly of any change of address
for the purpose of service of process. Notwithstanding anything herein to the contrary, a Creditor may bring any legal action or proceeding in any other appropriate jurisdiction.
13.3. WAIVER OF JURY TRIAL.
IT IS MUTUALLY AGREED BY AND AMONG THE BORROWERS AND EACH OF THE CREDITORS THAT EACH OF THEM HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY HERETO AGAINST ANY OTHER PARTY HERETO ON ANY MATTER
WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT OR THE NOTES.
14. THE AGENTS
14.1. Appointment and Authorization.
Each Bank irrevocably appoints and authorizes each Agent to take such action as agent on its behalf and to exercise such powers under this Agreement and the Notes as are delegated to such Agent by the terms hereof or thereof, together
with all such powers as are reasonably incidental thereto.
14.2. Agents and Affiliates.
So long as Nedship Bank N.V., Den norske Bank ASA and ING Bank N.V. remain Banks hereunder, they shall have the same rights and powers under this Agreement as any other Bank and may exercise or refrain from exercising the same as though
it were not an Agent and the terms "Bank" and "Banks" shall include each Agent in its capacity as a Bank. Each Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind of business with, the Borrowers, the
Subsidiaries or any Affiliate thereof as if it were not an Agent hereunder.
14.3. Action by Agents.
The obligations of each Agent hereunder are only those expressly set forth herein. Without limiting the generality of the foregoing, no Agent shall be required to take any action with respect to any Event of Default, except, in the
case of the Facility Agent, as expressly provided in Section 9. Each of the Agents shall be entitled to use its discretion with respect to exercising or refraining from exercising any rights which may be vested in it by, and with respect to taking or
refraining from taking any action or actions which it may be able to take under or in respect of, this Agreement and the Notes, unless an Agent shall have been instructed by the Majority Banks (or, to the extent provided herein, all of the Banks) to
exercise such rights or to take or refrain from taking such action; provided, however, that none of the Agents shall be required to take any action which exposes it to personal liability or which is contrary to this Agreement or Applicable Law.
14.4. Consultation with Experts.
Each Agent may consult with legal counsel (who may be counsel for one or more of the Borrowers), independent public accountants and other experts selected by it and shall not be liable to any Bank for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such counsel, accountants or experts.
14.5. Liability of the Agents.
No Agent nor any of its respective directors, officers, agents or employees shall be liable to any Bank for any action taken or not taken by it in connection herewith (a) with the consent or at the request of the Majority Banks or
(b) in the absence of its own gross negligence or willful misconduct. No Agent nor any of its respective directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with this Agreement or any Advance hereunder; (ii) the performance or observance of any of the covenants or agreements of any Borrower; (iii) the satisfaction of any condition specified in Section 3,
except receipt of items required to be delivered to such Agent; or (iv) the validity, effectiveness or genuineness of this Agreement, the Notes or any other instrument or writing furnished in connection herewith. Each Agent shall be entitled to
assume that this Agreement, the Notes or any other instrument or writing furnished in connection herewith are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be. No Agent shall incur any liability
by acting in reliance upon any notice, consent, certificate, statement or other writing (which may be a bank wire, telex or similar writing) believed by it to be genuine or to be signed by the proper party or parties.
14.6. Indemnification.
Each Bank shall, ratably in accordance with its Commitment, indemnify each Agent, its affiliates and their respective directors, officers, agents and employees (to the extent not reimbursed by the Borrowers) against any cost, expense
(including reasonable counsel fees and disbursements), claim, demand, action, judgment, suit, loss, damage, obligation, penalty, disbursement or liability of any kind whatsoever (except such as result from such indemnitee's gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection with or in any way relating to or arising out of this Agreement or the Notes or that such indemnitees may suffer or incur in connection with any action taken or omitted by such
indemnitees hereunder or thereunder. Without limiting the generality of the foregoing, each Bank agrees to reimburse each Agent promptly upon demand for its ratable share of any out-of-pocket expenses (including reasonable counsel fees and disbursements)
incurred by such Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or waiver of any provision of, or legal advice in
respect of rights or responsibilities under, this Agreement or the Notes, to the extent that such Agent is not reimbursed for such expenses by the Borrowers and to the extent the same does not result from the gross negligence or willful misconduct of such
Agent. Under no circumstances shall any Agent be obligated to expend its own funds for the protection of the interests of the Banks, but each Agent shall be entitled to be indemnified to its satisfaction hereunder by the Banks prior to taking any action
or expending any funds hereunder.
14.7. Credit Decision.
Each Bank acknowledges that it has, independently and without reliance upon any Agent or any other Bank, and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Bank also acknowledges that it will, independently and without reliance upon any Agent or any other Bank, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking any action under this Agreement.
14.8. Successor Facility Agent.
The Facility Agent may resign at any time by giving written notice thereof to the Banks and OSG. Upon any such resignation, the Banks shall appoint a successor Facility Agent, subject to the consent of OSG, such consent not to be
unreasonably withheld. OSG hereby consents to the appointment of any successor Agent that is a Creditor or a first class bank. If no successor Facility Agent shall have been so appointed by the Banks, and shall have accepted such appointment, within
30 days after the retiring Facility Agent gives notice of resignation, then the retiring Facility Agent may, on behalf of the Banks, appoint a successor Facility Agent, which shall be a bank or trust company of recognized standing having a combined
capital and surplus of at least $500,000,000. Upon the acceptance of its appointment as Facility Agent hereunder by a successor Facility Agent, such successor Facility Agent shall thereupon succeed to and become vested with all the rights and duties of
the retiring Facility Agent and the retiring Facility Agent shall be discharged from its duties and obligations hereunder. After any retiring Facility Agent's resignation hereunder as Facility Agent, the provisions of this Article shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Facility Agent.
14.9. Administrative Fee.
In connection with any assignment pursuant to Section 10.1, the transferor Bank shall pay to the Facility Agent an administrative fee for processing such assignment in the amount of $3,000.
14.10. Distribution of Payments.
Whenever any payment is received by the Facility Agent from the Borrowers for the account of the Banks, or any of them, whether of principal or interest on the Notes, Commitment Fees under Section 12.1, or otherwise, it will
thereafter cause like funds relating to such payment to be promptly distributed ratably to the Banks according to their respective Commitments, in each case to be applied according to the terms of this Agreement. Notwithstanding any other provision of
this Agreement, the Facility Agent (a) may, before making an amount available to a Bank, deduct and withhold from that amount any sum which is then due and payable to the Facility Agent from that Bank under this Agreement or any sum which the
Facility Agent is then entitled under this Agreement to require that Bank to pay on demand, and (b) shall not be obliged to make available to the Borrowers or any Bank any sum which the Facility Agent is expecting to receive for remittance or
distribution to the Borrowers or that Bank until the Facility Agent has satisfied itself that it has received that sum.
14.11. Holder of Interest in Notes.
The Facility Agent may treat each Bank as the holder of all of the interest of such Bank in its Note unless and until the Facility Agent has received a copy of an Assignment and Assumption Agreement evidencing the transfer of all or any
part of such Bank's interest in the Facility.
14.12. Assumption re Event of Default.
Except as otherwise provided in Section 14.13, the Facility Agent shall be entitled to assume that no Default or Event of Default, has occurred and is continuing, unless the Facility Agent has been notified by the Borrowers of such
fact or has been notified by a Bank that such Bank considers that a Default or Event of Default (specifying in detail the nature thereof) has occurred and is continuing. In the event that the Facility Agent shall have been notified by any party in the
manner set forth in the preceding sentence of any Default or Event of Default, the Facility Agent shall notify the Banks and shall take such action and assert such rights under this Agreement and under the Notes as the Majority Banks (or, to the extent
provided herein, all of the Banks) shall request in writing.
14.13. Notification of Event of Default.
The Facility Agent hereby undertakes promptly to notify the Banks, and each of the Banks hereby undertakes promptly to notify the Facility Agent and the other Banks, of the existence of any Event of Default which shall have occurred
and be continuing of which the Facility Agent or such Bank has actual knowledge.
14.14. Limitations of Liability of Creditors.
None of the Creditors shall be under any liability or responsibility whatsoever:
(a) to any Borrower or any other person or entity as a consequence of any failure or delay in performance by, or any breach by, any other Creditor or any other person of any of its or their respective obligations under this Agreement
or under the Notes;
(b) to any other Creditor as a consequence of any failure or delay in performance by, or any breach by, any Borrower of any of its respective obligations under this Agreement or under the Notes; or
(c) to any other Creditor for any statements, representations or warranties contained in this Agreement or in any document or instrument delivered in connection with the transactions hereby contemplated; or for the validity,
effectiveness, enforceability or sufficiency of this Agreement, the Notes or any document or instrument delivered in connection with the transactions hereby contemplated.
15. NOTICES AND DEMANDS
All notices, requests, demands and other communications to any party hereunder shall be in writing (including prepaid overnight courier, facsimile transmission or similar writing) and shall be given to the Borrowers and the Facility
Agent at their respective addresses or telecopy numbers set forth below and to any Bank at the address or telecopy number set forth in its Administrative Questionnaire or at such other address or telecopy number as such party may hereafter specify for the
purpose by notice to each other party hereto. Each such notice, request or other communication shall be effective (i) if given by telecopy or e-mail, when such telecopy or e-mail is transmitted to the telecopy number or e-mail address, as the case
may be, specified in this Section and (telephonic, in the case of a telecopy) confirmation of receipt thereof is obtained or (ii) if given by mail, prepaid overnight courier or any other means, when received at the address specified in this Section
or when delivery at such address is refused.
|
|
If to the Borrowers:
|
|
|
|
|
|
000 Xxxxx Xxxxxx
|
|
|
Xxx Xxxx, Xxx Xxxx 00000
|
|
|
Attention: Xxxxxx X. Xxxxx
|
|
|
|
Senior Vice President and Chief Operating Officer
|
|
Telephone: (000) 000-0000
|
|
|
Fax: (000) 000-0000
|
|
|
E-mail: xxxxxx@xxxxxxx.xxx
|
|
|
|
|
|
with a copy to:
|
|
|
|
|
|
Xxxxx X. Xxxxx
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
Overseas Shipholding Group, Inc.
|
|
|
000 Xxxxx Xxxxxx
|
|
|
Xxx Xxxx, Xxx Xxxx 00000
|
|
|
Telephone: (000) 000-0000
|
|
|
Fax: (000) 000-0000
|
|
|
E-mail: xxxxxx@xxxxxxx.xxx
|
|
|
|
|
|
If to the Facility Agent:
|
|
|
|
|
Den Norske Bank ASA
|
|
New York Branch
|
|
000 Xxxx Xxxxxx
|
|
Xxx Xxxx, Xxx Xxxx 00000-0000
|
|
|
|
Attention: Xx. Xxxxxxx Xxxxxxxxx
|
|
Telephone: (000) 000-0000
|
|
Fax: (000) 000-0000
|
|
E-mail: xxxxxxx.xxxxxxxxx@xxx.xx
16. LIMITATION OF LIABILITY/SURVIVAL
OF LIABILITY/CONTINUING INDEMNITIES
16.1. Limitation of Liability.
Notwithstanding anything to the contrary contained in this Agreement, in the event that any court or other judicial body of competent jurisdiction determines that legal principles of fraudulent conveyances,
fraudulent transfers or similar concepts are applicable in evaluating the enforceability against any Borrower or its respective assets of this Agreement and that under such principles, this Agreement would not be enforceable against such Borrower or its
assets unless the following provisions of this Section 16.1 had effect, then, the maximum liability of each Borrower hereunder (the "Maximum Liability Amount") shall be limited so that in no event shall such amount exceed the lesser of (i) the aggregate outstanding principal amount of the Advances drawn by such Borrower and (ii) an amount equal to the aggregate, without double
counting, of (a) ninety-five percent (95%) of such Borrower's Adjusted Net Worth (as hereinafter defined) on the date hereof, or on the date enforcement of this Agreement is sought (the "Determination Date"), whichever is greater and (b) the amount of any Valuable Transfer (as hereinafter defined) to such Borrower; provided that such Borrower's liability under this Agreement shall be further limited to the extent, if
any, required so that the obligations of such Borrower under this Agreement shall not be subject to being set aside or annulled under any applicable law relating to fraudulent transfers or fraudulent conveyances. As used herein "Adjusted Net Worth" of the respective Borrower shall mean, as of any date of determination thereof, an amount equal to the lesser of (a) an amount equal to the excess of (i) the amount of the present fair saleable value of the assets of such
Borrower over (ii) the amount that will be required to pay such Borrower's probable liability on its then existing debts, including contingent liabilities (exclusive of its contingent liabilities hereunder), as they become absolute and matured, and (b) an
amount equal to (i) the excess of the sum of such Borrower's property at a fair valuation over (ii) the amount of all liabilities of such Borrower, contingent or otherwise (exclusive of its contingent liabilities hereunder), as such terms are construed in
accordance with applicable laws governing determinations of the insolvency of debtors. In determining the Adjusted Net Worth of a Borrower for purposes of calculating the Maximum Liability Amount for such Borrower, the liabilities of such Borrower to be used in such determination pursuant to each clause (ii) of the preceding sentence shall in any event
exclude (a) the liability of such Borrower under this Agreement and (b) the liabilities of such Borrower subordinated in right of payment to this Agreement. As used herein "Valuable Transfer" shall mean, in respect of such Borrower, (a) all loans, advances or capital contributions made to such Borrower with proceeds of the Facility, (b) all debt securities or other obligations of such Borrower acquired from such
Borrower or retired by such Borrower with proceeds of the Facility, (c) the fair market value of all property acquired with proceeds of the Facility and transferred, absolutely and not as collateral, to such Borrower, (d) all equity securities of such Borrower acquired from such
Borrower with proceeds of the Facility, and (e) the value of any other economic benefits in accordance with applicable laws governing determinations of the insolvency of debtors, in each such case accruing to such Borrower as a result of the Facility and
this Agreement.
17. MISCELLANEOUS
17.1. Time of Essence.
Time is of the essence under this Agreement but no failure or delay on the part of any Creditor to exercise any power or right under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise by any
Creditor of any power or right hereunder preclude any other or further exercise thereof or the exercise of any other power or right. The remedies provided herein are cumulative and are not exclusive of any remedies provided by law.
17.2. Severability.
In case any one or more of the provisions contained in this Agreement or in the Notes would, if given effect, be invalid, illegal or unenforceable in any respect under any law applicable in any relevant jurisdiction, said provision
shall not be enforceable against the Borrowers, but the validity, legality and enforceability of the remaining provisions herein or therein contained shall not in any way be affected or impaired thereby.
17.3. References.
References herein to Articles, Sections (or subdivisions of Sections), Schedules, Annexes or Exhibits are to be construed as references to articles, sections (or subdivisions of sections) of, and schedules, annexes or exhibits to, this
Agreement or the Notes, as applicable, unless the context otherwise requires.
17.4. Further Assurances.
Each of the Borrowers agrees that if this Agreement or the Notes shall at any time be deemed by the Banks for any reason insufficient in whole or in part to carry out the true intent and spirit hereof or thereof, it will execute or
cause to be executed such other and further assurances and documents as in the opinion of the Banks may be required in order more effectively to accomplish the purposes of this Agreement and/or the Notes.
17.5. Prior Agreements, Merger.
Any and all prior understandings and agreements heretofore entered into between the Borrowers on the one part, and the Creditors, on the other part, whether written or oral, are superseded by and merged into this Agreement and the Notes
as to the subject matter hereof or thereof, which alone fully and completely express the agreements between the Borrowers and the Creditors as to such subject matter.
17.6. Entire Agreement, Amendments.
This Agreement and the Notes constitute the entire agreement of the parties hereto as to the subject matter hereof or thereof, including all parties added hereto pursuant to an Assignment and Assumption Agreement. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such amendment or waiver is in writing and is signed by the Borrowers and the Majority Banks (and, if the rights or duties of the Facility Agent are affected thereby, by the Facility Agent); provided that no amendment or waiver shall, unless signed by all the Banks, (a) increase or decrease the Commitment of any Bank or subject any Bank to any additional obligation, (b) reduce the principal of or rate of interest on any
Advance or any fees hereunder, (c) postpone the date fixed for any payment of principal of or interest on any Advance or any fees hereunder or for any termination of any Commitment, (d) amend Section 10, (e) waive any condition
precedent to the making of an Advance (other than the condition precedent set forth in Section 3.2(a)), (f) if any collateral shall have been granted pursuant to Section 8.1(s), release any such collateral, (g) consent to the assignment or transfer
by the Borrowers of any of their rights and obligations under this Agreement or the Notes or (h) amend or modify the definition of "Majority Banks" or this Section 17.6 or otherwise change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Facility Balance, or the number or category of Banks, which shall be required for the Banks or any of them to take any action under this Section or any other provision of this Agreement.
17.7. Headings.
In this Agreement, section headings are inserted for convenience of reference only and shall not be taken into account in the interpretation of this Agreement.
17.8. Survival.
The obligations of the Borrowers under Sections 6, 9.2, 11 and 12 shall survive the termination of this Agreement and the payment in full of all obligations hereunder.
17.9. Confidentiality.
The Creditors shall hold all non-public information (either in the form of non-public documentation relating to the Facility or which otherwise has been identified as non-public information by the Borrowers) obtained pursuant to the
requirements of this Agreement confidential for so long as such information remains non-public in accordance with its customary procedures for handling confidential information of this nature and in accordance with safe and sound banking practices and in
any event shall have the right to make disclosure (1) to any of their respective examiners, Affiliates, outside auditors, counsel and other professional advisors in connection with this Agreement, (2) as reasonably required by any bona fide transferee or Participant, potential bona fide transferee or Participant, (3) as required or requested by any Authority or pursuant to legal process, (4) as required by Applicable Law or (5) in
connection with any litigation to which both a Creditor and a Borrower are parties; provided, however, that
(a) unless specifically prohibited by Applicable Law or court order, such Agent or Bank shall notify the Borrowers of any request by any Authority (other than any such request in connection with an examination of the financial
condition of such Agent or Bank by such Authority) for disclosure of any such non-public information as soon as possible after any such request;
(b) any such bona fide transferee or Participant by their acceptance of such assignment or participation shall be deemed to have agreed (i) to be bound by this Section 17.9 and (ii) to require any other Person to whom such
transferee or Participant discloses such non-public information to be similarly bound by this Section 17.9;
(c) the Creditors shall require any potential bona fide transferee or Participant to whom the Creditors may disclose such non-public information to be bound by a confidentiality agreement containing provisions substantially
identical to this Section 17.9 (except that subparagraph (d) shall not apply unless such Person becomes a transferee or Participant) or incorporating the same by reference; and
(d) except as may be required by an order of a court of competent jurisdiction and to the extent set forth therein (but in such case, the Creditors may retain any materials furnished by the Borrowers in accordance with their
customary credit or document retention policies), the Creditors shall not be obligated or required to return any materials furnished by the Borrowers.
17.10. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts together shall constitute one and the same instrument.
17.11. WAIVER OF IMMUNITY.
TO THE EXTENT THAT ANY BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM SUIT, JURISDICTION OF ANY COURT OR ANY LEGAL PROCESS (WHETHER THROUGH ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION, EXECUTION OF A JUDGMENT,
OR FROM ANY OTHER LEGAL PROCESS OR REMEDY) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE NOTES.
IN WITNESS whereof the parties hereto have caused this Agreement to be duly executed by their duly authorized representative as of the day and year first above written.
|
|
OVERSEAS SHIPHOLDING GROUP, INC., as
|
|
Borrower
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
OSG BULK SHIPS, INC., as
|
|
Borrower
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
OSG INTERNATIONAL, INC., as
|
|
Borrower
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
DEN NORSKE BANK ASA,
|
|
as Facility Agent, Arranger
|
|
and Bank
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
ING BANK N.V., as Documentation Agent, Arranger
|
|
and Bank
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
|
|
NEDSHIP BANK N.V., as
|
|
Syndication Agent, Arranger and Bank
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
MEESPIERSON CAPITAL CORP.,
|
|
as Arranger and Bank
|
|
|
|
|
|
By
|
|
Name: Xxxxx Xxxx
|
|
Title: Managing Director
|
|
|
|
|
|
By
|
|
Name: Xxxxxxxxxxx Xxxxxx
|
|
Title: Managing Director
|
|
|
|
|
|
HAMBURGISCHE LANDESBANK
|
|
- GIROZENTRALE, as
|
|
Co-Arranger and Bank
|
|
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
CRÉDIT AGRICOLE INDOSUEZ UK,
|
|
as Senior Lead Manager and Bank
|
|
|
|
|
|
By
|
|
Name: Thibaud Escoffier
|
|
Title: Senior Vice-President
|
|
|
|
|
|
SCOTIABANK (IRELAND) LIMITED,
|
|
as Senior Lead Manager and Bank
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
LANDESBANK SCHLESWIG-HOLSTEIN
|
|
GIROZENTRALE, as Lead
|
|
Manager and Bank
|
|
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
THE BANK OF NEW YORK,
|
|
as Lead Manager and Bank
|
|
|
|
|
|
By
|
|
Name:
|
|
Title:
|
|
|
|
|
|
NIB CAPITAL BANK N.V.,
|
|
as Lead Manager and Bank
|
|
|
|
|
|
By
|
|
Name:
|
|
Title:
|
SCHEDULE I
BANKS
|
Agents/Arrangers
|
Commitment
|
|
|
Den norske Bank ASA
|
$55,000,000
|
New York Branch
|
|
000 Xxxx Xxxxxx
|
|
Xxx Xxxx, Xxx Xxxx 00000-0000
|
|
Attention: Xx. Xxxxxxx Xxxxxxxxx
|
|
Telephone: (000) 000-0000
|
|
Facsimile: (000) 000-0000
|
|
E-mail: xxxxxxx.xxxxxxxxx@xxx.xx
|
|
|
|
ING Bank N.V.
|
$55,000,000
|
Corporate Clients
|
|
Weena 501
|
|
3013 AL Rotterdam
|
|
The Netherlands
|
|
Attention: Xx. Xxxx Xxxxx
|
|
Telephone: 000-00-00-000-0000
|
|
Facsimile: 011-31-10-444-6791
|
|
E-mail: xxxx.xxxxx@xxxx.xxx.xx
|
|
|
|
Nedship Bank N.V.
|
$55,000,000
|
Xxxxxxxx 0
|
|
0000 XX Xxxxxxxxx
|
|
Xxx Xxxxxxxxxxx
|
|
Attention: Mr. Ben Rosemoller
|
|
Telephone: 000-00-00-000-0000
|
|
Facsimile: 011-31-10-436-2957
|
|
E-mail: xxx.xxxxxxxxxxxx@xxx.xxxxxxxx.xxx
|
|
|
|
Contact Address:
|
|
Nedship International Inc.
|
|
00 Xxxxx Xxxxx Xxxx
|
|
Xxxxxxxxx, XX 00000
|
|
Attention: Xx. Xxxxxx Xxxxxxxx
|
|
Telephone: (000) 000-0000
|
|
Facsimile: (000) 000-0000
|
|
E-mail: x.xxxxxxxx.xxxxxxx@xxx.xxxxxxxx.xxx
|
|
|
|
Arranger
|
|
|
|
MeesPierson Capital Corp.
|
$50,000,000
|
Three Stamford Plaza
000 Xxxxxxx Xxxxxxxxx
|
|
Xxxxxxxx, XX 00000-0000
|
|
Attention: Chr. Xxxxxx Xxxxxx
|
|
Assistant Vice President
|
|
Telephone: 0-000-000-0000
|
|
Facsimile: 0-000-000-0000
|
|
email: XXX@Xxxxxxxxxxxxxx.xxx
|
|
|
|
Co-Arranger
|
|
|
|
Hamburgische Landesbank - Girozentrale -
|
$35,000,000
|
Xxxxxxx-Xxxxxxxxx-Xxxxx 00
|
|
00000 Xxxxxxx
|
|
Attention: Xx. Xxx Xxxxxxxx
Telephone: 000-00-00-0000-0000
|
|
Facsimile: 011-49-40-3333-3069
|
|
E-mail: xxx.xxxxxxxx@xxxxxxxxx.xx
|
|
|
|
Senior Lead Managers
|
|
|
|
Crédit Agricole Indosuez
|
$25,000,000
|
0 Xxxx xx Xxxxxxxxx Xxxx Xxxxxx
|
|
00000 Xxxxxxxxxx - Xx Xxxxxxx Cedex
|
|
France
|
|
c/o Credit Agricole Indosuez UK
|
|
Shipping Department
|
|
000 Xxxxxxxxxx Xxxxxx
|
|
XXX 0XX Xxxxxx
|
|
XX
|
|
Attention: Xx. Xxxx Xxxxxxxxxx
|
|
Telephone: 000-00-000-000-0000
|
|
Facsimile: 011-44-207-894-2307
|
|
E-mail: xxxx.xxxxxxxxxx@xxxxxxxx.xx.xx
|
|
|
|
Scotiabank (Ireland) Limited
|
$25,000,000
|
I.F.S.C. House
|
|
Xxxxxx Xxxxx Xxxx
|
|
Xxxxxx 0, Xxxxxxx
|
|
Attention: Mr. John X. X. Xxxxxxxx
|
|
Telephone: 000-0000-000-0000
|
|
Facsimile: 011-3531-670-0684
|
|
E-mail: xxxxxxxx@xxxxxxxxxx.xxx
|
|
|
|
Lead Managers
|
|
|
|
Landesbank Schleswig-Holstein
|
$20,000,000
|
Xxxxxxxxxxxx
Xxxxxxxxxxx 0
|
|
00000 Xxxx, Xxxxxxx
|
|
Attention: Xx. Xxxxx Xxxxxxxxxxx
|
|
Telephone: 000-00-000-000-0000
|
|
Facsimile: 011-49-431-900-1130
|
|
|
|
The Bank of New York
|
$15,000,000
|
One Wall Street - Marine Transportation Division
00xx Xxxxx
|
|
Xxx Xxxx, Xxx Xxxx 00000
|
|
Attention: Xx. Xxxxxxx X. Xxxxxxxx
|
|
Telephone: 000-000-0000
|
|
Facsimile: 000-000-0000
|
|
E-mail: xxxxxxxxx@xxxxxxxx.xxx
|
|
|
|
|
|
NIB Capital Bank N.V.
|
$15,000,000
|
4 Carnegieplein, X.X. Xxx 000
|
|
0000 XX Xxx Xxxxx
|
|
Xxx Xxxxxxxxxxx
|
|
Attention: Xxxxx Xxxxxxx
|
|
Telephone: 000-00-00-000-0000
|
|
Facsimile: 011-31-70-342-5577
|
|
E-mail: xxxxx.xxxxxxx@xxxx.xxx
|
|
SCHEDULE II
APPLICABLE MARGIN
|
Rating Level1
(S&P/Xxxxx'x)
|
Applicable Margin
|
Commitment Fee
|
|
|
|
BBB+/Baa1 or better
|
62.5 bps
|
21.875 bps
|
|
|
|
BBB/Baa2
|
75.0 bps
|
26.250 bps
|
|
|
|
BBB-/Baa3
|
100.0 bps
|
35.000 bps
|
|
|
|
BB+/Ba1
|
112.5 bps
|
39.375 bps
|
|
|
|
BB/Ba2
|
135.0 bps
|
47.250 bps
|
BB-/Ba3 or worse
|
150.0 bps
|
52.500 bps
or, if OSG is no longer rated, the margin shall be determined by the ratio of Cash Adjusted Funded Debt to Consolidated EBITDA:
|
CAFD/CEBITDA
|
Applicable Margin
|
Commitment Fee
|
|
|
|
<2.5
|
62.5 bps
|
21.875 bps
|
|
|
|
2.5 < 3.0
|
75.0 bps
|
26.250 bps
|
|
|
|
3.0 < 4.25
|
100.0 bps
|
35.000 bps
|
|
|
|
4.25 < 5.5
|
112.5 bps
|
39.375 bps
|
|
|
|
5.5 < 7.0
|
135.0 bps
|
47.250 bps
|
> 7.0
|
150.0 bps
|
52.500 bps
___________________
1 If there is a split between the S&P and Xxxxx'x ratings, then the higher rating level shall be used for purposes of determining the Applicable Margin.
|
SCHEDULE III
FUNDED DEBT AT DECEMBER 31, 1999
|
In thousands at December 31,
|
1999
|
Unsecured Revolving Credit Agreement with banks
|
$ 457,000
|
8.75% Debentures due 2013, net of unamortized discount of $191
|
84,784
|
8% Notes due 2003, net of unamortized discount of $80
|
84,820
|
Floating rate secured Term Loans, due through 2008
|
102,046
|
Floating rate unsecured Promissory Note, due through 2005
|
24,350
|
Other
|
2,904
|
|
$ 755,904
SCHEDULE IV
ACCEPTABLE BROKERS
X.X. Xxxxxx A/S (Norway)
Platou (Norway)
Fearnleys (Norway)
X. Xxxxxxxx (UK)
X.X. Xxxxxx (UK)
X.X. Xxxxxxx (Shipbrokers) Ltd. (USA)
Jacq. Pierot Jr. & Sons, Inc. (USA)
EXHIBIT A
FORM OF ADMINISTRATIVE QUESTIONNAIRE
Lender Administrative Questionnaire
At closing, Den norske Bank, New York Branch will assume the duties and functions of Facility Agent for the Facility. This questionnaire should be completed in order to facilitate closing and ongoing communication.
FAX ALONG WITH COMMITMENT LETTER TO:
XXXXXXX XXXXXXXXX, Den norske Bank ASA, FAX# x0 000 000-0000
XXXX XXXXX, ING Bank NV, FAX# x00 00 000-0000
XXXXX X'XXXX, Nedship International, FAX# x0 000 000-0000
|
Borrower Information
|
Borrower Name:
|
Overseas Shipholding Group, Inc.
|
Amount and Facility:
|
$350,000,000 Senior Revolving Credit Facility
|
Borrower Tax ID(s)#:
|
00-0000000
|
Participant Information
|
Legal Name of Lender for Signature Page:
|
|
Name of Lender for any eventual tombstone:
|
|
Institution Tax ID#:
|
|
|
General Information
|
Domestic Lending Office:
|
Eurodollar Lending Office:
|
Institution Name:
|
|
|
Street Address:
|
|
|
City/State/Zip:
|
|
|
Country:
|
|
|
|
Credit Contact
|
Operations Contact
|
Legal Counsel
|
Primary Contact:
|
|
|
|
Title:
|
|
|
|
Street Address:
|
|
|
|
City/State/Zip:
|
|
|
|
Country:
|
|
|
|
Telephone #:
|
|
|
|
Fax #:
|
|
|
|
|
|
|
|
Email Address:
|
|
|
|
Secondary Contact:
|
|
|
|
Title:
|
|
|
|
Street Address:
|
|
|
|
City/State/Zip:
|
|
|
|
Country:
|
|
|
|
Telephone #:
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Fax #:
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Email Address:
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Wire Routing Instructions
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Name of Lender:
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ABA Number:
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City/State:
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Country:
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Account Name:
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Account Number:
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Attention:
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Reference:
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Mailing Addresses
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Credit Agreement Delivery
|
Financial Information Delivery
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Name:
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Title:
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Street Address:
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City/State/Zip:
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Country:
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Telephone #:
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Fax #:
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Email Address:
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Tax Withholding
|
Non-Resident Alien:
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Yes, Form 4224 attached.
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Tax ID Number:
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Form W9 attached.
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Facility Agent Information
|
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Credit Contact
|
Customer Service (Loan Administration)
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Name:
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Xxxxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxx
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Title:
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Senior Vice President
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Street Address:
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000 Xxxx Xxxxxx
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000 Xxxx Xxxxxx
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Xxxx/Xxxxx/Xxx:
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Xxx Xxxx, XX 00000
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Xxx Xxxx, XX 00000
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Country:
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USA
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USA
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Telephone #:
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x0 (000) 000-0000
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x0 (000) 000-0000
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Fax #:
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x0 (000) 000-0000
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x0 (000) 000-0000
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Email Address:
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xxxxxxx.xxxxxxxxx@xxx.xx
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alberto xxxxxx@xxx.xx
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Facility Agent Wire Instructions
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Bank:
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Unibank, NY Branch
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ABA Number:
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000000000
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F/O:
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Overseas Shipholding Group
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Account #:
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00000000
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Reference:
|
OSG Facility
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Attn:
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Xxxxxxx Xxxxxx
Completed By
___________________
Signature
EXHIBIT B
=====================================================================
FORM OF
ASSIGNMENT AND ASSUMPTION AGREEMENT
between
[NAME OF ASSIGNOR]
and
[NAME OF ASSIGNEE]
=====================================================================
______________,
ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement"), dated as of ___________, ____ between [NAME OF ASSIGNOR], a [bank]/[corporation] organized under the laws of [JURISDICTION OF ASSIGNOR] (the "Assignor"), and
[NAME OF ASSIGNEE], a [bank]/[corporation] organized under the laws of [JURISDICTION OF ASSIGNEE] (the "Assignee"), supplemental to:
(i) that certain Credit Agreement, dated as of April 18, 2000 (as amended, restated, modified or supplemented from time to time, the "Credit Agreement"), made among (a) Overseas Shipholding Group, Inc., OSG Bulk
Ships, Inc. and OSG International, Inc., as borrowers ("Borrowers"), (b) the banks and financial institutions parties thereto as lenders (the "Banks"), including the Assignor, (c) Den norske Bank ASA, as facility agent (the "Facility Agent"), (d) ING Bank N.V., as documentation agent, and
(e) Nedship Bank N.V., as syndication agent, pursuant to which the Banks agreed, severally and not jointly, to make available to the Borrowers a revolving credit facility of up to $350,000,000 (the "Facility"); and
(ii) each promissory note made by the Borrowers payable to the order of each Bank dated May 2, 2000 (collectively, the "Notes") evidencing the Advances.
Except as otherwise defined herein, terms defined in the Credit Agreement have the same meaning when used herein.
In consideration of the premises and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
1. The Assignor hereby sells, transfers and assigns to the Assignee, without recourse, ___% of the Assignor's right, title and interest in, to and under the: (a) Credit Agreement and (b) its Note (including, without limitation,
its interest in the indebtedness evidenced by such Note). Simultaneously herewith, the Assignee shall pay to the Assignor an amount equal to the purchase price agreed between them in a separate writing.
2. The Assignee hereby assumes ___% of the obligations of the Assignor under the Credit Agreement and shall hereafter be a "Bank" for all purposes of the Credit Agreement and the Notes, the Assignee's Commitment thereunder
being $________ in respect of the Facility.
3. The [Assignor] [Assignee] shall pay an administrative fee of Three Thousand Dollars ($3,000) to the Facility Agent to reimburse the Facility Agent for its cost in processing the assignment and assumption herein contained.
4. If it is not a U.S. person, the Assignee shall, on or prior to the date hereof and from time to time thereafter when required by applicable provisions of the United States Internal Revenue Code, provide the Borrower with two
duly completed copies of Internal Revenue Service Form 1001 or 4224, as appropriate, or any successor form prescribed by the Internal Revenue Service, certifying that the Assignee is entitled to benefits under an income tax treaty to which the United
States is a party that exempts withholding tax on payments under the Credit Agreement and the Note or certifying that the income receivable pursuant to the Credit Agreement or the Note is effectively connected with the conduct of a trade or business in
the United States.
5. The Assignee irrevocably designates and appoints the Facility Agent as its agent, and irrevocably authorizes the Facility Agent, to take such action on its behalf and to exercise such powers on its behalf under the Credit
Agreement and under its Note, each as supplemented hereby, as are delegated to the Facility Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto all as provided in Section 14 of the Credit Agreement.
6. The Assignor makes no representation or warranty in connection with, and shall have no responsibility with respect to, the solvency, financial condition or statements of the Borrowers, or the validity and enforceability of the
obligations of the Borrowers in respect of the Credit Agreement or the Note. The Assignee acknowledges that it has, independently and without reliance on the Assignor or the Facility Agent, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this Agreement and will continue to be responsible for making its own independent appraisal of the business, affairs and financial condition of the Borrowers.
7. Every notice or demand under this Agreement shall be in writing and may be given by telecopy and shall be sent as follows:
If to the Assignor:
[NAME OF ASSIGNOR]
[ADDRESS]
Attention:
Telephone:
Facsimile:
E-mail:
If to the Assignee:
|
[NAME OF ASSIGNOR]
[ADDRESS]
Attention:
Telephone:
Facsimile:
E-mail:
Every notice or demand hereunder shall be deemed to have been received at the time of receipt thereof. The Assignee designates its address given above as its address for notices pursuant to Section 15 of the Credit Agreement.
8. EACH OF THE ASSIGNOR AND THE ASSIGNEE HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY HERETO ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT.
9. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
10. This Agreement may be executed in several counterparts with the same effect as if the parties executing such counterparts executed one agreement as of the date hereof and each counterpart when executed and delivered shall
be deemed to be an original and all of such counterparts together shall constitute this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.
|
|
[NAME OF ASSIGNOR]
By
Name:
Title:
|
|
[NAME OF ASSIGNEE]
By
Name:
Title:
|
Consented and Agreed this
day of , :
|
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OVERSEAS SHIPHOLDING GROUP, INC.
|
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|
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By
|
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Name:
Title:
|
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OSG BULK SHIPS, INC.
|
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By
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Name:
Title:
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OSG INTERNATIONAL, INC.
|
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By
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Name:
Title:
|
EXHIBIT C
PROMISSORY NOTE
|
US $
|
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May 2, 0000
|
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|
|
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Xxx Xxxx, Xxx Xxxx
FOR VALUE RECEIVED, each of the undersigned, OVERSEAS SHIPHOLDING GROUP, INC., a corporation incorporated under the laws of Delaware, OSG BULK SHIPS, INC., a corporation incorporated under the laws of New York, and OSG
INTERNATIONAL, INC., a corporation incorporated under the laws of the Republic of the Xxxxxxxx Islands (each, a "Borrower" and collectively, the "Borrowers"), hereby jointly and severally promises to pay to the order of [INSERT NAME OF BANK], [INSERT JURISDICTION OF ORGANIZATION OF BANK AND TYPE OF ENTITY] ("__________"), with offices at [INSERT
ADDRESS OF BANK], the principal sum of [INSERT XXXXXX XX XXXXXXXXXX XX XXXX] Xxxxxx Xxxxxx Dollars (US $___________) or, if less, the aggregate unpaid principal amount of the Advances from time to time outstanding made by _______ to the Borrowers pursuant
to the Credit Agreement, dated as of April 18, 2000, by and among the Borrowers, MeesPierson Capital Corp., Hamburgische Landesbank - Girozentrale, Crédit Agricole Indosuez, Scotiabank (Ireland) Limited, Landesbank Schleswig-Holstein Girozentrale,
The Bank of New York, NIB Capital Bank N.V., Den norske Bank ASA, ING Bank N.V. and Nedship Bank N.V. (as amended, restated, modified or supplemented from time to time, the "Credit Agreement"). The Borrowers shall repay the principal amount of such Advances as provided in Section 4 of the Credit Agreement, but in any event no later than the Final Payment Date.
Words and expressions used herein (including those in the foregoing paragraph) and defined in the Credit Agreement shall have the same meaning herein as therein defined.
Each Advance shall bear interest at the rate as set forth in Section 5.1 of the Credit Agreement. Any principal payment not paid when due, whether by acceleration or otherwise, shall bear interest thereafter at the Default Rate.
All interest shall accrue and be calculated on the actual number of days elapsed and on the basis of a 360 day year and be payable as provided in the Credit Agreement.
Both principal and interest are payable in Dollars to the Facility Agent, at its office located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx (or to such other branch of the Facility Agent as the Facility Agent may direct).
__________________ may endorse the amount and the date of the making of each Advance evidenced hereby and each payment of principal hereunder on the grid annexed hereto and made a part hereof, which endorsement shall constitute
prima facie evidence of the accuracy of the information so endorsed; provided, however, that any failure to endorse such information on such grid shall not in any manner affect the obligation of the Borrowers to make payment of
principal and interest in accordance with the terms of this Promissory Note.
If this Promissory Note or any payment required hereunder becomes due and payable on a day which is not a Banking Day the due date thereof shall be extended until the next following Banking Day (in which event, interest shall be
payable during such extension at the rate applicable immediately prior thereto), unless such next following Banking Day falls in the following month in which case such payment shall be payable on the Banking Day next preceding the day on which such
payment would otherwise be payable.
Amounts due hereunder may be prepaid in accordance with the terms of the Credit Agreement.
This Promissory Note is one of the Notes referred to in, and is entitled to the benefits of, the Credit Agreement. Upon the occurrence of any Event of Default, the principal hereof and accrued interest hereon may become, or may be
declared to be and shall thereupon become, forthwith due and payable.
Presentment, demand, protest and notice of dishonor of this Promissory Note and any other notice of any kind are hereby expressly waived.
THE BORROWERS AND, BY ITS ACCEPTANCE HEREOF, _______________ HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY HERETO OR ANY BENEFICIARY HEREOF ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS PROMISSORY NOTE.
THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Borrowers have executed and delivered this Promissory Note on the date and year first above written.
|
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OVERSEAS SHIPHOLDING GROUP, INC.
|
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By
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Name:
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Title:
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OSG BULK SHIPS, INC.
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By
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Name:
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Title:
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OSG INTERNATIONAL, INC.
|
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By
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Name:
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Title:
OVERSEAS SHIPHOLDING GROUP, INC.
|
Date
|
Amount of Advance
|
Amount of Principal Paid
or Prepaid
|
Unpaid
Principal
Balance
|
Notation
Made By
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OSG BULK SHIPS, INC.
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Date
|
Amount of Advance
|
Amount of Principal Paid
or Prepaid
|
Unpaid
Principal
Balance
|
Notation
Made By
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OSG INTERNATIONAL, INC.
|
Date
|
Amount of Advance
|
Amount of Principal Paid
or Prepaid
|
Unpaid
Principal
Balance
|
Notation
Made By
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EXHIBIT D
=====================================================================
FORM OF
DRAWDOWN NOTICE
=====================================================================
DRAWDOWN NOTICE
___________ __, ____
Den norske Bank ASA
New York Branch
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xx. Xxxxxxx Xxxxxxxxx
Ladies and Gentlemen:
Please be advised that, in accordance with the terms of Section 2.2 of the Credit Agreement, dated as of April 18, 2000, among Overseas Shipholding Group, Inc., OSG Bulk Ships, Inc. and OSG International, Inc., as borrowers (the "
Borrowers"), the banks and financial institutions listed on Schedule I thereto, as lenders, Den norske Bank ASA, as facility agent, ING Bank N.V., as documentation agent, and Nedship Bank N.V., as syndication agent (the "Credit Agreement"), the
undersigned hereby gives you notice of drawdown of an Advance. All terms used herein, shall have the meanings given thereto in the Credit Agreement.
|
Name(s) of Borrower(s) (and allocation if more than one Borrower):
|
_______________________
|
|
|
Amount of Advance:
|
US$___________________
|
Drawdown Date:
|
|
|
|
Initial Interest Period
|
[7 days] [1/3/6/12 month(s)]
|
|
|
Disbursement Instructions:
|
________________________
________________________
________________________
We hereby warrant that the representations and warranties stated in Section 7 (updated mutatis mutandis) of the Credit Agreement are true and correct on the date hereof and will be true and correct on the date that the
Advance requested by this drawdown notice is made1 and that no Default or Event of Default has occurred and is continuing.
In the event that the Banks and Participants, if any, shall not be obliged under the terms of the Credit Agreement to make the above requested Advance (including, without limitation any such failure resulting from the failure of the
Borrowers to satisfy a condition precedent set forth in Section 3 of the Credit Agreement)2, the Borrowers shall indemnify and hold fully harmless the Banks, Participants or any of them, against any losses which the Banks, Participants or any of them, may sustain as a result of borrowing or agreeing to borrow funds to meet the
drawdown requirement in respect thereof and the certificate of the relevant Bank or Participant shall, absent manifest error, be conclusive and binding on the Borrowers as to the extent of any such losses.
This Drawdown Notice is effective upon receipt by you and shall be irrevocable.
|
OVERSEAS SHIPHOLDING GROUP, INC.
|
|
By__________________________________
|
Name:
Title:
|
OSG BULK SHIPS, INC.
|
|
By__________________________________
|
Name:
Title:
|
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OSG INTERNATIONAL, INC.
|
|
By__________________________________
|
Name:
Title:
________________
1 Insert the following if the Advance would not result in an incremental increase in the aggregate amount of Advances outstanding under the Facility and such Advance is to be made after the initial Drawdown
Date -- "provided , however that (i) the representations and warranties set forth in Section 7.1(e) and (o) of the Credit Agreement shall be deemed inapplicable as of the date hereof and as of the date of the Advance and (ii) any representation and
warranty which relates solely to an earlier date shall be true and accurate on and as of such earlier date";
2 Insert the following in the initial Drawdown Notice -- "or the failure of the Credit Agreement to become effective"
EXHIBIT E
=====================================================================
FORM OF COMPLIANCE CERTIFICATE
from
OVERSEAS SHIPHOLDING GROUP, INC.,
OSG BULK SHIPS, INC.
AND OSG INTERNATIONAL, INC.
to
DEN NORSKE BANK ASA
=====================================================================
,
FORM OF COMPLIANCE CERTIFICATE
CERTIFICATE OF THE CHIEF FINANCIAL OFFICER
OF
OVERSEAS SHIPHOLDING GROUP, INC.
FOR THE PERIOD ENDED ______________
Reference is made to that certain Credit Agreement, dated as of April 18, 2000 (as amended from time to time, the "Credit Agreement"), among OVERSEAS SHIPHOLDING GROUP, INC. ("OSG"), OSG BULK SHIPS, INC. ("
;OSG Bulk") and OSG INTERNATIONAL, INC. (collectively with OSG and OSG Bulk, the "Borrowers"), the banks and financial institutions which are parties to the Credit Agreement (the "Banks"), DEN NORSKE BANK ASA,
as facility agent (the "Facility Agent"), ING BANK N.V., as documentation agent, and NEDSHIP BANK N.V., as syndication agent. Capitalized terms used herein without definition have the meanings ascribed thereto in the Credit Agreement. The undersigned, being the
chief financial officer of OSG hereby certifies, on behalf of the Borrowers, to the Facility Agent and the Banks as follows:
(i) I have reviewed the [audited] consolidated balance sheet of OSG and the Subsidiaries dated as of and the related
[audited] consolidated statements of operations and retained earnings and cash flows for the period then ended and such financial statements fairly present the financial condition of OSG and the Subsidiaries as of the dates indicated and the results of their
operations and cash flows for the periods indicated; and
(ii) I have reviewed the terms of the Credit Agreement and have made, or caused to be made under my supervision, a review in reasonable detail of the transactions and the condition of OSG and the Subsidiaries during the accounting
period covered by the financial statements referred to in clause (i) above; and
(iii) such review has not disclosed the existence during or at the end of such accounting period of any condition or event that constitutes a Default or an Event of Default, nor do I have knowledge of the existence of any such
condition or event as at the date of this Certificate [EXCEPT, [IF SUCH CONDITION OR EVENT EXISTED OR EXISTS, DESCRIBE THE NATURE AND PERIOD OF EXISTENCE THEREOF AND WHAT ACTION OSG OR ANY SUBSIDIARY, AS THE CASE MAY BE, HAS TAKEN, IS TAKING AND PROPOSES
TO TAKE WITH RESPECT THERETO]]; and
(iv) the Borrowers are in compliance with the covenants contained in Section 8 of the Credit Agreement, including, without limitation the covenants set forth in Sections 8.1(o) through 8.1(s), 8.2(a), (c), (e) and (h), and Annex A
attached hereto shows the calculation thereof in sufficient detail as to permit the verification thereof by the Facility Agent.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of this day of
.
|
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OVERSEAS SHIPHOLDING GROUP, INC.
|
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|
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|
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By:
|
|
Name:
|
|
Title:
ANNEX A
|
1.
|
Section 8.1(o) - Consolidated Tangible Net Worth
|
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Consolidated Tangible Net Worth
|
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|
|
(i) Stockholders' equity (as shown on
|
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|
|
the most recent consolidated balance sheet
|
|
|
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of OSG and the Recourse Subsidiaries)
|
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$_____________
|
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minus
|
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-
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|
|
(ii) Intangible Assets of OSG and
|
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the Recourse Subsidiaries
|
|
$_____________
|
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=
|
$_____________
|
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Requirement per Credit Agreement:
|
|
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|
|
Consolidated Tangible Net Worth = not less than $575,000,000 plus 50% of cumulative Consolidated Net Income (to the extent
positive) for each fiscal quarter from and after June 30, 2000.
|
2.
|
Section 8.1(p) - Cash Adjusted Debt Service Coverage Ratio
|
|
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|
|
(i) Cash Adjusted Income Available
|
|
$_____________
|
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for Fixed Charges
|
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to
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(ii) Adjusted Fixed Charges
|
|
$_____________
|
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|
|
Minimum Requirement per Credit Agreement - not less than 1.75:1
|
|
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|
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3.
|
Section 8.1(q) - Unencumbered Assets to Unsecured Debt Ratio
|
|
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|
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(i) Unencumbered Assets
|
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Tangible Assets (excluding any assets
|
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$______________
|
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which consist of shares of stock of Subsidiaries
|
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|
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which have been pledged to secure any obligations)
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minus
|
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the sum of (A) Attributable Debt and (without
|
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$_______________
|
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duplication) (B) the Book Value of OSG and
|
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|
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the Recourse Subsidiaries which are subject to a Lien
|
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securing Secured Debt
|
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to
|
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(ii) Unsecured Debt
|
|
$_______________
|
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|
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Minimum Requirement per Credit Agreement - not less than 1.50:1
|
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4.
|
Section 8.1(r) - Cash Adjusted Funded Debt to Cash Adjusted Consolidated Net Tangible Assets
|
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|
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(i) Cash Adjusted Funded Debt
|
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|
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(A) Consolidated Funded Debt
|
|
$_______________
|
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minus
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(B) Cash
|
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$_______________
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to
|
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|
|
|
|
|
|
(ii) Cash Adjusted Consolidated Net Tangible Assets
|
|
|
|
(A) Consolidated Net Tangible Assets
|
|
$_______________
|
|
|
|
|
|
minus
|
|
|
|
|
|
|
|
(B) Cash
|
|
$_______________
|
|
|
|
|
|
Minimum Requirement per Credit Agreement - not more than 0.60:1
|
|
|
|
|
5.
|
Section 8.1(s) - Security Interest on Ratings Downgrade
|
|
|
|
|
|
|
|
(i) Fair Market Value of Vessel Collateral
|
|
$_______________
|
|
|
|
|
|
(ii) Amount of Cash Collateral
|
|
$_______________
|
|
|
|
|
|
(iii) Aggregate Principal Amount
|
|
|
|
of all Advances outstanding
|
|
$_______________
|
|
|
|
|
|
Requirement per Credit Agreement:
|
|
Under the circumstances described in Section 8.1(s), the sum of (x) 80% of the Fair Market Value of any Vessel
Collateral, plus (y) any Cash Collateral, must equal or exceed the sum of the aggregate principal amount of all Advances outstanding on the date of calculation.
If the sum of (x) 71.429% of the Fair Market Value of any Vessel Collateral plus (y) any Cash Collateral exceeds the
aggregate principal amount of all Advances outstanding on the date of calculation, collateral may be released pursuant to the terms of Section 8.1(s).
|
6.
|
Section 8.2(a) - Limitation on Secured Debt
|
|
|
|
|
|
|
|
(i) Unencumbered Assets
|
|
|
|
|
|
|
|
Tangible Assets (excluding any assets which
|
|
$_______________
|
|
consist of shares of stock of Subsidiaries which
|
|
|
|
|
|
|
|
have been pledged to secure any obligations)
|
|
|
|
|
|
|
|
minus
|
|
|
|
|
|
|
|
the sum of (A) Attributable Debt and (without
|
|
$_______________
|
|
duplication) (B) the Book Value of all assets of
|
|
|
|
OSG and the Recourse Subsidiaries which are
|
|
|
|
subject to a Lien securing Secured Debt
|
|
|
|
|
|
|
|
to
|
|
|
|
|
|
|
|
(ii) Unsecured Debt
|
|
$_______________
Minimum Requirement per Credit Agreement - After giving effect to the creation, assumption or incurrence of Secured Debt and
to the application of the proceeds thereof, not less than 1.50:1; and
|
|
(i) Collateralized Assets
|
|
$_______________
|
|
|
|
|
|
to
|
|
|
|
|
|
|
|
(ii) Consolidated Net Tangible Assets
|
|
$_______________
Minimum Requirement per Credit Agreement - After giving effect to the creation, assumption or incurrence of Secured Debt and
to the application of the proceeds thereof, not greater than 0.25:1.
|
7.
|
Section 8.2(c) - Conduct of Business
|
|
|
|
|
|
|
|
Operating Assets in Shipping and
|
|
$_______________
|
|
Related Businesses
|
|
|
|
|
|
|
|
Operating Assets
|
|
$_______________
|
|
|
|
|
|
Requirement per Credit Agreement:
|
|
After giving effect to any acquisition of Operating Assets or Investments in Operating Assets, at least 70% (based on the most
recent consolidated balance sheet of OSG and the Recourse Subsidiaries required to be provided pursuant to Section 8.1(d)) of the Operating Assets of OSG and the Recourse Subsidiaries must be (on a consolidated basis) in Shipping and Related Businesses.
|
8.
|
Section 8.2(e) - Mergers, Consolidations and Sales of Assets -
calculation of "Substantial Part"
|
|
|
|
|
|
Book Value of assets to be sold
|
|
$_______________
|
|
|
|
|
|
Book Value of all other assets sold, leased
|
|
|
|
or otherwise disposed of by OSG and the
|
|
|
|
Subsidiaries during prior twelve months
|
|
$_______________
|
|
|
|
|
|
Consolidated Net Tangible Assets
|
|
$_______________
If the Book Value of the assets, when added to the Book Value of all other assets sold, leased or otherwise disposed of by OSG and the Subsidiaries
during the prior 12 months, exceeds 15% of Consolidated Net Tangible Assets, the sale, lease or other disposition of assets shall be deemed to be a "Substantial Part" of the assets of OSG and the Recourse Subsidiaries taken as a whole.
|
9.
|
Section 8.2(h) - Maximum Investments in Joint Ventures
|
|
|
|
|
|
Aggregate amount of all Investments in
|
|
|
|
Joint Ventures (after giving effect to a
|
|
|
|
proposed Investment in any Joint Venture)
|
|
|
|
("Aggregate Joint Venture Investments")
|
|
$_______________
|
|
|
|
|
|
Consolidated Net Tangible Assets
|
|
$_______________
|
|
|
|
|
|
Requirement per Credit Agreement:
|
|
|
|
|
|
|
|
Aggregate Joint Venture Investments must not
|
|
|
|
exceed 22.5% of Consolidated Net Tangible Assets
|
|
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