EXHIBIT 2.38
Bona Shipholding Ltd
as Borrower
Chase Manhattan plc
as Arranger
Citibank International plc
as Arranger, Trustee And Agent
and others
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Amended and restated
US$500,000,000
Revolving Loan Agreement
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CONTENTS
Clause Page
Part 1 DEFINITIONS AND INTERPRETATION
1. Definitions and Interpretation..........................................1
Part 2 THE FACILITIES
2. The Facilities.........................................................17
3. Utilisation of the Facilities..........................................18
Part 3 INTEREST
4. Payment and Calculation of Interest....................................20
5. Market Disruption and Alternative Interest Rates.......................20
Part 4 REPAYMENT, REDUCTION, CANCELLATION AND PREPAYMENT
6. Repayment and Reduction................................................21
7. Cancellation...........................................................22
Part 5 RISK ALLOCATION
8. Taxes..................................................................24
9. Tax Receipts and Credits...............................................25
10. Changes in Circumstances...............................................26
Part 6 REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT
11. Representations........................................................29
12. Financial Information..................................................31
13. Financial Condition and Security.......................................33
14. Covenants..............................................................38
15. Events of Default......................................................40
Part 7 DEFAULT INTEREST AND INDEMNITY
16. Default Interest and Indemnity.........................................44
Part 8 PAYMENTS
17. Currency of Account and Payment........................................46
18. Payments...............................................................46
19. Set-Off................................................................48
20. Sharing................................................................48
Part 9 FEES, COSTS AND EXPENSES
21. Commitment Commission and Fees.........................................50
22. Costs and Expenses.....................................................51
Part 10 AGENCY PROVISIONS
23. The Agent, the Trustee, the Arrangers and the Banks....................52
Part 11 ASSIGNMENTS AND TRANSFERS
24. Assignments and Transfers..............................................57
Part 12 MISCELLANEOUS
25. Calculations and Evidence of Debt......................................59
26. Remedies and Waivers, Partial Invalidity...............................59
27. Notices................................................................60
28. Amendments.............................................................61
Part 13 LAW AND JURISDICTION
29. Law....................................................................63
30. Jurisdiction...........................................................63
London-3/140335/04 - 61 - C0828/29464
THIS AGREEMENT originally made on 16 December 1998 is amended and restated on 11
June 1999
BETWEEN
(1)......BONA SHIPHOLDING LTD. (the "Borrower");
(2) CHASE MANHATTAN plc and CITIBANK INTERNATIONAL plc (the "Arrangers");
(3) CITIBANK INTERNATIONAL plc (the "Trustee"); and
(4) CITIBANK INTERNATIONAL plc (the "Agent")
(5) THE BANKS (as defined below).
NOW IT IS HEREBY AGREED as follows:
Part 1
DEFINITIONS AND INTERPRETATION
1. Definitions and Interpretation
1.1 Definitions
In this Agreement the following terms have the meanings given to them in
this Clause 1.1.
"A Advance" means, save as otherwise provided herein, an Advance (as
from time to time reduced by repayment or prepayment) made or to be made
by the Banks under the A Facility.
"A Available Commitment" means, in relation to a Bank at any time and
save as otherwise provided herein, its A Commitment at such time less
the aggregate of its portions of A Advances which are then outstanding
and not due for repayment Provided that such amount shall not be less
than zero.
"A Available Facility" means, at any time, the aggregate amount of the A
Available Commitments at such time.
"A Commitment" means, in relation to any Bank at any time and save as
otherwise provided herein, the amount set opposite its name in the
second column of the First Schedule.
"Advance" means, save as otherwise provided herein, an advance under
either Facility made or to be made by the Banks hereunder.
"A Facility" means the revolving dollar loan facility granted to the
Borrower pursuant to paragraph (i) of Clause 2.1 (Grant of Facilities).
"Affiliate" means a corporation or partnership at least 33% of the
equity or partnership capital of which is beneficially owned, directly
or indirectly, by any member of the Parent's Group and the value of the
interest of such member of the Parent's Group therein (as determined in
accordance with US GAAP) is not less than $10,000,000.
"Aggregate A Commitment" means the aggregate for the time being of the
Banks' A Commitments.
"Aggregate B Commitment" means the aggregate for the time being of the
Banks' B Commitments.
"Aggregate Total Commitments" means the aggregate for the time being of
the Banks' Total Commitments.
"Available Commitment" means, in relation to a Bank at any time and save
as otherwise provided herein, the aggregate of its Total Commitment at
such time less the aggregate of its portions of the Advances which have
then been made hereunder.
"Available Facility" means, at any time, the aggregate amount of the
Available Commitments at such time.
"Average Age of the Vessels" at any time means the average age of the
Vessels in the Security Pool at such time, but so that for these
purposes, if an asset in the Security Pool comprises shares in a
vessel-owning company, the vessel owned by that company shall be brought
into account as if it were a Vessel.
"B Advance" means, save as otherwise provided herein, an Advance (as
from time to time reduced by repayment or prepayment) made or to be made
by the Banks under the B Facility.
"Bank" means:
(i) any financial institution named in the First Schedule (The
Banks) (other than one which has ceased to be a party hereto
in accordance with the terms hereof); or
(ii) any financial institution which has become a party hereto in
accordance with the provisions of Clause 24.4 (Assignments by
Banks) or Clause 24.5 (Transfers by Banks).
"Basle Paper" means the paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988 and prepared
by the Basle Committee on Banking Regulations and Supervision, as
amended in November 1991.
"B Available Commitment" means, in relation to a Bank at any time and
save as otherwise provided herein, its B Commitment at such time less
the aggregate of its portions of B Advances which are then outstanding
and not due for repayment Provided that such amount shall not be less
than zero.
"B Available Facility" means, at any time, the aggregate amount of the B
Available Commitments at such time.
"Bermuda" means the Islands of Bermuda.
"B Commitment" means, in relation to any Bank at any time and save as
otherwise provided herein, the amount set opposite its name in the third
column of the First Schedule.
"B Facility" means the dollar revolving loan facility granted to the
Borrower pursuant to paragraph (ii) of Clause 2.1 (Grant of Facilities).
"Borrower's Group" means the Borrower and its subsidiaries for the time
being.
"Capital Adequacy Requirement" means a request or requirement relating
to the maintenance of capital, including one which makes any change to,
or is based on any alteration in, the interpretation of the Basle Paper
or which increases the amounts of capital required thereunder, other
than a request or requirement made by way of implementation of the Basle
Paper in the manner in which it is being implemented as at the Original
Facility Date.
"Chase Revolver" means the revolving credit facility agreement dated 27
March 1996 between the Borrower, Chemical Bank and others.
"Citibank Revolver" means the revolving credit facility agreement dated
11 October 1994 between the Borrower, Citibank, N.A. and others.
"Commitment Termination Date" means the date which is one month before
the Final Maturity Date.
"Cover Ratio" at any time means, in relation to the A Facility, the
Estimated Value of Security Pool 1 divided by Loan 1 and, in relation to
the B Facility means the Estimated Value of Security Pool 2 divided by
Loan 2.
"Current Assets" means all assets of the members of the Borrower's Group
(excluding Intra-Group Assets) which, in accordance with US GAAP, would
be classed as current assets plus the aggregate of all amounts available
for drawing for more than one year but undrawn under committed credit
lines (excluding the Facilities) made available to any member of the
Borrower's Group by its bankers or by any other financial institution.
"Current Liabilities" means all obligations of the members of the
Borrower's Group to pay money on demand or within one year from the date
of computation and any other obligations of the members of the
Borrower's Group which, in accordance with US GAAP, would be considered
as current liabilities.
"Current Ratio" at any time means Current Assets divided by Current
Liabilities.
"Deeds of Assignment" means the deeds of assignment of earnings and
insurances in the form or substantially the form attached hereto as
Exhibit B (with such amendments as may in the Agent's opinion be
appropriate to reflect the place of registration of the relevant Vessel)
to be executed by the Borrower in favour of the Trustee over the Vessels
as contemplated by paragraph 19 of Part 1, and by paragraph 11 of Part 2
of the Third Schedule.
"Estimated Value" means
(i) (subject to (iii) below in respect of a New Vessel) in respect of a vessel
the average of the most recent estimates of the Market Value thereof set
forth in the summary furnished to the Agent pursuant to Clause 12.6(i)
Provided that if a vessel is the subject of a charter which had an initial
duration of over 24 months and which was approved by the Agent acting on
the instructions of the Banks, the Estimated Value of such vessel shall be
increased (or reduced) to reflect any difference between (a) the amount
determined by the Agent to be the net present value of the charterhire
payable over the remaining period of such charter and (b) the amount
determined by the Agent to be the net present value of the charterhire that
would be payable under a charter of such vessel for such period if it were
to be chartered in the market at charterhire rates current as at the
preceding Quarter Date;
(ii) in respect of any asset in a Security Pool other than a vessel, the most
recent estimate of the value thereof furnished to the Agent pursuant to
Clause 12.6(ii); and
(iii)in respect of a New Vessel and for the purposes only of Clause 3.1(vi) the
value as determined pursuant to Clause 13.9
Provided Always That any Vessel older than 27 years 6 months shall be
deemed to have a value of zero.
"Estimated Value of Security Pool 1" and "Estimated Value of Security
Pool 2" at any time mean the aggregate of the Estimated Values of the
relevant Vessels and the Estimated Values of the other assets in
Security Pool 1, or, as the case may be, the aggregate of the Estimated
Values of the relevant Vessels and the Estimated Values of the other
assets in Security Pool 2 at such time.
"Event of Default" means any circumstance described as such in Clause 15
(Events of Default).
"Excluded Entity" means any subsidiary of the Borrower (i) which is not
controlled, directly or indirectly, by the Borrower and (ii) in which
the Borrower's direct or indirect interest is as holder of equal to or
less than 50% of the issued share capital or as contributor of equal to
or less than 50% of the partnership capital and for these purposes a
company or corporation shall be treated as being controlled by another
if that other company or corporation is able to direct its affairs
and/or to control the composition of its board of directors or
equivalent body Provided Always, for the avoidance of doubt, that
Soponata-Bona Limited shall be an Excluded Entity, for so long as the
Borrower's direct or indirect interest therein is 50% (or less) of the
issued share capital thereof and Soponata-Bona Limited is not controlled
directly or indirectly by the Borrower.
"Existing Swaps" means the two interest rate swap agreements entered
into by the Borrower with Royal Bank of Scotland and BankBoston, both to
expire on February 19 2005 and both for a notional principal amount of
$50,000,000.
"Facilities" means the A Facility and the B Facility granted to the
Borrower in this Agreement and "Facility" shall be construed
accordingly.
"Facility Office" means, in relation to the Agent or any Bank, the
office identified with its signature below (or, in the case of a
Transferee, at the end of the Transfer Certificate to which it is a
party as Transferee) or such other office as it may from time to time
select.
"Final Maturity Date" means the tenth anniversary of the Original
Facility Date.
"Finance Documents" means:
(i) this Agreement;
(ii) the Guarantee;
(iii) the Security Agreements; and
(iv) any other document from time to time entered into in relation
to this Agreement which is agreed between the Agent and the
Borrower to constitute a Finance Document for the purposes
hereof.
"Finance Parties" means the Parent and the Borrower.
"Free Cash" means, on any date, the aggregate amount (expressed in
dollars or as a dollar equivalent) on such date of the then current
market value of:
(i) all amounts which are legally and beneficially owned by the
Borrower and which are standing to the credit of current and
deposit accounts with banks and other deposit taking
institutions excluding any such amount to which the right of
access or use of the owner is blocked or restricted (whether
by an encumbrance or otherwise);
(ii) to the extent not within (i) above, all unencumbered time
deposits with banks and other deposit taking institutions and
certificates of deposit issued, and bills of exchange
accepted, by banks and other deposit taking institutions which
are legally and beneficially owned by the Borrower free from
encumbrances; and
(iii) debt securities quoted on a trading exchange approved by the
Agent acting on the instructions of an Instructing Group which
are rated AA or better by Standard & Poor's Corporation or
such other rating agency as the Agent acting as aforesaid may
approve,
to which the Borrower shall have free, immediate and direct access (but
limited, if appropriate, to that portion thereof which the Borrower
shall be entitled to appropriate for its own account) plus the aggregate
amount (expressed in dollars or as a dollar equivalent) of the items set
out in (i), (ii) and (iii) above which shall be legally and beneficially
owned by any subsidiary of the Borrower and to which the Borrower
(through such subsidiary) shall have free, immediate and direct access
(but limited, if appropriate, to that portion thereof which such
subsidiary shall be entitled to appropriate for its own benefit) as
multiplied by the Relevant Percentage in respect of that subsidiary, but
excluding from such computation (i) Intra-Group Assets and (ii) any
amounts attributable to any Excluded Entity or minority interests.
"Future Vessel" means (subject always to Clause 13.11) any vessel
purchased by the Borrower and which is mortgaged to provide security for
the Borrower's obligations hereunder and which is allocated to Security
Pool 2.
"Guarantee" means the guarantee of the Borrower's obligations hereunder
given by the Parent substantially in the form of Exhibit D.
"Initial Vessels" means the following Vessels:
Vessels flagged in Liberia:
"Bona Shimmer", "Bona Spinner", "Bona Skipper", "▇▇▇▇ ▇▇▇▇▇",
"Bona Rider", "Bona Rover", "▇▇▇▇ ▇▇▇", "Bona Ranger";
Vessels flagged in the Bahamas:
"Bona Forum", "Bona Fulmar", "Bona Foam", "Bona Favour",
"Bona Spring", "Bona Sparrow", "Bona Sailor", "Bona Spray";
Vessels flagged in the Norwegian International Register:
"Bona Fountain", "Bona Fair"
and "Initial Vessel" means any of them;
"Instructing Group" means:
(i) whilst no Advances are outstanding hereunder, a Bank or group
of Banks whose Total Commitments amount (or, if each Bank's
Total Commitment has been reduced to zero, did immediately
before such reduction to zero, amount) in aggregate to more
than 662/3 per cent. of the Aggregate Total Commitments; and
(ii) whilst at least one Advance is outstanding hereunder, a Bank
or group of Banks to whom in aggregate more than 662/3 per
cent. of the Loan is (or immediately prior to its prepayment
or repayment, was then) owed.
"Interest Payment Date" means any date upon which interest is payable
pursuant to Clause 4.1.
"Intra-Group Asset" means (i) any indebtedness which is owed to any
member of the Borrower's Group by any member of the Parent's Group or by
any Affiliate; (ii) any capital contribution made by any member of the
Borrower's Group in any member of the Parent's Group or any Affiliate;
and (iii) any equity security issued by any member of the Parent's Group
or by any Affiliate which is beneficially owned by any member of the
Borrower's Group (the values of (i), (ii) and (iii) to be determined in
accordance with US GAAP).
"ISM Code" means the International Management Code for the Safe
Operation of Ships for pollution prevention adopted by the International
Maritime Organisation.
"Leverage" at any time means Total Liabilities divided by Total Assets.
"Liberia" means the Republic of Liberia.
"LIBOR" means, in relation to any period for which an interest rate is
to be determined hereunder, the rate determined by the Agent to be the
rate displayed on the Telerate screen (or, if there is no such rate on
the Telerate screen, the rate displayed on the Reuters screen) for the
British Bankers' Association rate for deposits in dollars for a period
corresponding to such period at or about 11.00 a.m. on the Quotation
Date therefor Provided that if no such rate is so displayed on either
the Telerate screen or the Reuters screen at such time it means the rate
per annum determined by the Agent to be the arithmetic mean (rounded
upwards, if not already such a multiple, to the nearest whole multiple
of one-thirty-second of one per cent.) of the rates (as notified to the
Agent) at which each of the Reference Banks was offering to prime banks
in the London Interbank Market deposits in dollars for a period
corresponding to such period at such time.
"Liquid Assets" means the aggregate of Free Cash and marketable
securities as defined by US GAAP.
"Loan 1" means the aggregate principal amount outstanding under the A
Facility, from time to time.
"Loan 2" means the aggregate principal amount outstanding under the B
Facility from time to time.
"Loan" means the aggregate principal amount of Loan 1 and Loan 2 for the
time being outstanding hereunder.
"Margin 1" means (a) 0.775% per annum up to (but not including) the
fifth anniversary of the first drawdown hereunder and (b) 0.825% per
annum thereafter until the Final Maturity Date Provided That during such
time as Net Leverage is equal to or less than 50%, (on the basis of the
most recent financial statements delivered pursuant to Clause 12.1 or
Clause 12.2), then the applicable Margin 1 for any A Advance shall be
0.725% p.a. (or, if the rate in (b) would otherwise apply, the
applicable Margin 1 shall be 0.775% p.a.).
"Margin 2" means (a) 0.9% per annum up to (but not including) the fifth
anniversary of the first drawdown hereunder and (b) 0.95% per annum
thereafter until the Final Maturity Date Provided That during such time
as Net Leverage is equal to or less than 50%, (on the basis of the most
recent financial statements delivered pursuant to Clause 12.1 or Clause
12.2), then the applicable Margin 2 for any B Advance shall be 0.85%
p.a. (or, if the rate in (b) would otherwise apply, the applicable
Margin 2 shall be 0.9% p.a.).
"Market Value" means, in relation to a vessel at any time, the sale
value thereof in dollars determined on the basis of a sale (for cash and
prompt delivery) by a willing seller to a willing buyer, free of charter
and encumbrances and at arm's length on normal commercial terms;
"Material Subsidiary" means (i) the Borrower; (ii) Bona Shipping A.S.
and (iii) any subsidiary of the Parent whose assets, as determined in
accordance with US GAAP and as shown from whose most recently available
financial statements, as multiplied by the Relevant Percentage in
respect of such subsidiary, equal or exceed 10% of the value of the
assets of the Parent's Group as determined in accordance with US GAAP
and as shown from the most recently available financial statements of
the Parent's Group Provided that:
(i) in respect of any subsidiary of the Parent, only the value of
its assets as multiplied by the Relevant Percentage in respect
of such subsidiary shall be taken into account in the
computation of the value of the assets of the Parent's Group;
and
(ii) a statement by the auditors of the Parent to the effect that,
in their opinion, a subsidiary is or is not or was or was not
at any particular time a Material Subsidiary shall, in the
absence of manifest error, be conclusive and binding on the
parties hereto;
"Mortgages" means the first preferred (or first priority) ship mortgages
over the Vessels in the form or substantially the form of that attached
hereto as Exhibits C1, C2 and C3 (with such amendments as may in the
Agent's reasonable opinion be appropriate to reflect the place of
registration of the relevant Vessel) to be granted by the Borrower in
favour of the Trustee as contemplated by paragraph 18 of Part 1 and
paragraph 10 of Part 2 of the Third Schedule;
"Net Leverage" means:
Total Liabilities less (Liquid Assets exceeding $25,000,000)
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Total Assets less (Liquid Assets exceeding $25,000,000)
"Newbuilding Facility" means the facility agreement dated 17 June 1997
between the Borrower, Chase Investment Bank Limited, and Citibank
International plc as arrangers and Chase Manhattan Bank Norge AS as
agent and others.
"New Vessels" means New Vessel 1, New Vessel 2, New Vessel 3 and New
Vessel 4 or any combination thereof and "New Vessel" shall be construed
accordingly.
"New Vessel 1" means the vessel scheduled to be delivered by the Yard to
the Borrower in January 1999 and having the Yard's Hull No 1234.
"New Vessel 2" means the vessel scheduled to be delivered by the Yard to
the Borrower in April 1999 and having the Yard's Hull No 1235.
"New Vessel 3" means the vessel scheduled to be delivered by the Yard to
the Borrower in June 1999 and having the Yard's Hull No 1236.
"New Vessel 4" means the vessel scheduled to be delivered by the Yard to
the Borrower in February 2000 if the Borrower exercises its option to
purchase such vessel.
"NIS" means the Norwegian International Ship Register.
"Notice of Drawdown" means a notice substantially in the form set out in
the Fourth Schedule (Notice of Drawdown).
"Option Declaration Date" means 15 July 1999;
"Original Consolidated Financial Statements" means the audited
consolidated financial statements of the Borrower's Group for its
financial year ended 31 December 1997.
"Original Facility Date" means 16 December 1998.
"Parent" means Teekay Shipping Corporation, a Liberian corporation.
"Parent's Group" means the Parent and its subsidiaries for the time
being.
"Potential Event of Default" means any event which may become (with the
passage of time, the giving of notice, the making of any determination
hereunder or any combination thereof) an Event of Default.
"Proportion" means, in relation to a Bank:
(i) whilst no Advances are outstanding hereunder, the proportion
borne by its Total Commitment to the Aggregate Total
Commitments (or, if the Aggregate Total Commitments are then
zero, by its Total Commitment to the Aggregate Total
Commitments immediately prior to their reduction to zero); or
(ii) whilst at least one Advance is outstanding hereunder, the
proportion borne by its share of the Loan to the Loan.
"Quarter Date" means 31 March, 30 June, 30 September and 31 December in
any year.
"Quotation Date" means, in relation to any period for which an interest
rate is to be determined hereunder, the day on which quotations would
ordinarily be given by prime banks in the London Interbank Market for
deposits in dollars for delivery on the first day of that period
Provided that, if, for any such period, quotations would ordinarily be
given on more than one date, the Quotation Date for that period shall be
the last of those dates.
"Reduction Dates" means (i) the date which is 6 months after the
Original Facility Date, (ii) each of the days which fall at six monthly
intervals after such date specified in (i), and (iii) the Final Maturity
Date.
"Reference Banks" means the principal London offices of Citibank N.A.,
The Chase Manhattan Bank, and Christiania Bank og Kreditkasse ASA or
such other Bank or Banks as may from time to time be agreed between the
Borrower and the Agent acting on the instructions of an Instructing
Group.
"Relevant Percentage" means, in respect of any subsidiary of the Parent
at any time, the percentage of the equity share capital or the
partnership capital, as the case may be, of such subsidiary which is
beneficially owned (free from encumbrances) by the Parent at that time.
"Repayment Date" means, in relation to any Advance, the last day of the
Term thereof.
"Security Agreements" means each of the following:
(i) the Mortgages;
(ii) the Deeds of Assignment; and
(iii) any other document from time to time entered into in relation
to this Agreement which it is agreed between the Agent (or, as
the case may be, the Trustee) and the Borrower is to
constitute a Security Agreement for the purposes hereof.
"Security Pool" means Security Pool 1 and Security Pool 2, or either of
them as the context requires.
"Security Pool 1" means the Initial Vessels, the New Vessels and each of
the other assets from time to time mortgaged or charged to secure the
Borrower's obligations under this Agreement and allocated to Security
Pool 1.
"Security Pool 2" means the Future Vessels and each of the other assets
from time to time mortgaged or charged to secure the Borrower's
obligations under this Agreement and allocated to Security Pool 2.
"Security Trust Deed" means the security trust agreement to be entered
into between the Trustee and others in the form or substantially the
form of that attached hereto as Exhibit A whereby the Trustee will hold
the benefit of the Security Documents on behalf of the Beneficiaries (to
be defined therein).
"Soponata - Bona Guarantee" means the guarantee of 50% of the
outstanding amounts from time to time under a $75,000,000 loan agreement
dated 26 June 1996 between Soponata - Bona Limited as borrower,
Christiania Bank og Kreditkasse as agent and others.
"Term" means, save as otherwise provided herein, in relation to any
Advance, the period for which such Advance is borrowed as specified in
the Notice of Drawdown relating thereto.
"Total Assets" means (subject to the second proviso to Clause 13.1) the
aggregate of the assets of the Borrower's Group as determined in
accordance with US GAAP (excluding Intra-Group Assets), but so that for
the purposes of this definition the value attributable to each vessel in
the Borrower's Group's fleet (or, if different, each Vessel) shall be
adjusted to reflect her most recent Estimated Value.
"Total Commitments" means, in relation to a Bank at any time and save as
otherwise provided herein, the amount set opposite its name in the First
Schedule in the column headed "Total Commitment".
"Total Liabilities" means the aggregate of the obligations of the
Borrower and its subsidiaries for the payment of money, whether borrowed
or not and whether present or future, as determined in accordance with
US GAAP.
"Transfer Certificate" means a certificate substantially in the form set
out in the Second Schedule (Form of Transfer Certificate) signed by a
Bank and a Transferee whereby:
(i) such Bank seeks to procure the transfer to such Transferee of
all or a part of such Bank's rights, benefits and obligations
hereunder as contemplated in Clause 24.3 (Assignments and
Transfers by Banks); and
(ii) such Transferee undertakes to perform the obligations it will
assume as a result of delivery of such certificate to the
Agent as is contemplated in Clause 24.5 (Transfers by Banks).
"Transfer Date" means, in relation to any Transfer Certificate, the date
for the making of the transfer as specified in the schedule to such
Transfer Certificate.
"Transferee" means a bank or other financial institution (unless it is
another Bank, approved by the Borrower in writing,) to which a Bank
seeks to transfer all or part of such Bank's rights, benefits and
obligations hereunder.
"US GAAP" at any time means accounting policies generally accepted in
the United States of America at such time.
"Vessels" means the Initial Vessels, the New Vessels and the Future
Vessels or any combination thereof and any other vessel which is
mortgaged to provide security for the Borrower's obligations hereunder
pursuant to any of the provisions of Clause 13.1, 13.2, 13.4 or 13.6 and
"Vessel" shall be construed accordingly.
"Yard" means Samsung Heavy Industries Co. Ltd of Korea.
1.2 Interpretation
Any reference in this Agreement to:
"acting in concert" shall be construed as a reference to any two or more
persons co-operating pursuant to any agreement or arrangement (whether
or not legally binding or formally recorded) in connection with the
acquisition, or attempted acquisition, by any of them of control over
any company;
the "Agent", the "Trustee", or any "Bank" shall be construed so as to
include its and any subsequent successors, Transferees and permitted
assigns in accordance with their respective interests;
a "business day" shall be construed as a reference to a day (other than
a Saturday or Sunday) on which banks generally are open for business in
London, New York City and Oslo;
a "charter" shall be construed as a reference to any agreement (other
than, for the purposes of the definition of "Market Value", a contract
of affreightment) pursuant to which a vessel is, or will be, employed;
the "date hereof" shall be a reference to the date upon which this
Agreement was amended and restated rather than the Original Facility
Date.
an "encumbrance" shall be construed as a reference to a mortgage,
charge, pledge, lien or other encumbrance securing any obligation of any
person, or any other type of preferential arrangement (including title
transfer and retention arrangements) having a similar effect;
the "equivalent" in one currency (in this paragraph the "first
currency") of an amount denominated in another currency (in this
paragraph the "second currency") on any date shall, save as otherwise
provided, be construed as a reference to the amount of the first
currency which could be purchased with that amount of the second
currency at the spot rate of exchange quoted by the Agent in the foreign
exchange market in London at or about 11.00 a.m. on such date for the
purchase of the first currency with the second currency for the second
business day thereafter;
a "guarantee" includes any guarantee, indemnity or other obligation to
pay, purchase, provide funds for the payment of or indemnify against the
consequences of default in the payment of indebtedness of any other
person and any encumbrance which secures the payment of any indebtedness
of any other person;
a "holding company" of a company or corporation shall be construed as a
reference to any company or corporation of which the first-mentioned
company or corporation is a subsidiary;
"indebtedness" shall be construed so as to include any obligation
(whether incurred as principal or as surety) for the payment or
repayment of money, whether present or future, actual or contingent;
"indebtedness for borrowed money" shall be construed as a reference to
any indebtedness of any person for or in respect of:
(i) moneys borrowed or raised;
(ii) amounts raised under any acceptance credit facility;
(iii) amounts raised pursuant to any note purchase facility or the
issue of bonds, notes, debentures, loan stock or similar
instruments;
(iv) amounts raised pursuant to any issue of shares of any member
of the Borrower's Group which are expressed to be redeemable;
(v) the amount of any liability in respect of leases or hire
purchase contracts which would, in accordance with US GAAP be
treated as finance or capital leases;
(vi) the amount of any liability in respect of any purchase price
for assets or services the payment of which is deferred for a
period in excess of one hundred and eighty (180) days;
(vii) all reimbursement obligations whether contingent or not in
respect of amounts paid under a letter of credit or similar
instrument;
(viii) all interest rate and currency swap and similar agreements
obliging the making of payments, whether periodically or upon
the happening of a contingency (and the value of such
indebtedness shall be the ▇▇▇▇-to-market valuation of such
transaction at the relevant time);
(ix) amounts raised under any other transaction (including, without
limitation, any forward sale or purchase agreement) having the
commercial effect of a borrowing; and
(x) any guarantee of indebtedness falling within paragraphs (i) to (ix) above.
a "month" is a reference to a period starting on one day in a calendar
month and ending on the numerically corresponding day in the next
succeeding calendar month save that, where any such period would
otherwise end on a day which is not a business day, it shall end on the
next succeeding business day, unless that day falls in the calendar
month succeeding that in which it would otherwise have ended, in which
case it shall end on the immediately preceding business day Provided
that, if a period starts on the last business day in a calendar month or
if there is no numerically corresponding day in the month in which that
period ends, that period shall end on the last business day in that
later month (and references to "months" shall be construed accordingly);
a "person" shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal
personality) of two or more of the foregoing;
a "subsidiary" of a company or corporation shall be construed as a
reference to any company or corporation:
(i) which is controlled, directly or indirectly, by the first-mentioned company
or corporation;
(ii) more than half the issued share capital of which is beneficially owned,
directly or indirectly, by the first-mentioned company or corporation; or
(iii)which is a subsidiary of another subsidiary of the first-mentioned company
or corporation
and, for these purposes, a company or corporation shall be treated as
being controlled by another if that other company or corporation is able
to direct its affairs and/or to control the composition of its board of
directors or equivalent body Provided that neither Bona Fortuna KS nor
Bona Freighter KS shall constitute subsidiaries of any member of the
Group;
"tax" shall be construed so as to include any present or future tax,
levy, impost, duty or other charge of a similar nature (including any
penalty or interest payable in connection with any failure to pay or any
delay in paying any of the same);
a "total loss" of a Vessel shall be construed so as to include (a) an
actual, constructive, agreed, arranged or compromised total loss of such
Vessel including such as may occur during a requisition for hire of such
Vessel and (b) the requisition for title of a Vessel (otherwise than by
requisition for hire) by any government or other competent authority or
by any person acting or purporting to act by the authority of the same
and from which such Vessel has not been released within a period of
ninety days of such event occurring;
"VAT" shall be construed as a reference to value added tax including any
similar tax which may be imposed in place thereof from time to time;
"vessel" means any Vessel and any other vessel owned by the Borrower or
any of its subsidiaries; and
the "winding-up", "dissolution" or "administration" of a company or
corporation shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which such
company or corporation is incorporated or any jurisdiction in which such
company or corporation carries on business including the seeking of
liquidation, winding-up, reorganisation, dissolution, administration,
arrangement, adjustment, protection or relief of debtors.
1.3 Currency Symbols
"$" and "dollars" denote lawful currency of the United States of
America.
1.4 Amendments
Save where the contrary is indicated, any reference in this Agreement
to:
(i) this Agreement or any other agreement or document shall be
construed as a reference to this Agreement or, as the case may
be, such other agreement or document as the same may have
been, or may from time to time be, amended, varied or
supplemented;
(ii) a statute shall be construed as a reference to such statute as
the same may have been, or may from time to time be, amended
or re-enacted; and
(iii) a time of day shall be construed as a reference or re-enacted
to London time.
1.5 Headings
Clause, Part and Schedule headings are for ease of reference only.
1.6 Total Loss of Vessel
For the purposes of the Finance Documents, a total loss of a Vessel
shall be deemed to have occurred:
(i) if it consists of an actual total loss, at noon Greenwich Mean
Time on the actual date of loss or, if that is not known, on
the date on which such Vessel was last heard of;
(ii) if it consists of a requisitioning for title, at noon
Greenwich Mean Time on the date on which the same is expressed
to take effect by the person making the same; and
(iii) if it consists of a constructive or compromised or arranged or
agreed total loss, at noon Greenwich Mean Time on the date at
which notice of abandonment of such Vessel is given to her
insurers for the time being or (if her insurers for the time
being do not admit the claim for total loss) at the time on
which a total loss is subsequently adjudged to have occurred
by a competent court or arbitration tribunal or liability in
respect thereof as a total loss is admitted by insurers.
1.7 Construction
In the event of a conflict between any words and expressions defined
herein and any words and expressions used in any of the Security
Agreements, unless otherwise defined therein, the words and expressions
defined herein will prevail for the purpose of the Finance Documents.
Part 2
THE FACILITIES
2. The Facilities
2.1 Grant of the Facilities
The ▇▇▇▇▇ ▇▇▇▇▇ to the Borrower, upon the terms and subject to the
conditions hereof:-
(i) the A Facility being a dollar revolving loan facility in an aggregate
amount of $400,000,000 and;
(ii) the B Facility being a dollar revolving loan facility in an aggregate
amount of $100,000,000.
2.2 Purpose and Application
(i) The A Facility is intended to enable the Borrower (a) to
refinance the outstandings under the Citibank Revolver and the
Chase Revolver and (b) to finance part of the purchase price
of each New Vessel in an amount of up to $30,000,000 (or, in
the case of New Vessel 4 in an amount of up to $25,000,000) on
the date of delivery of such New Vessel;
(ii) The B Facility is intended to enable the Borrower to finance
part of the purchase price of each Future Vessel on the date
of delivery of such Future Vessel (or acquire all the issued
shares in a company which itself owns such Future Vessel)
and accordingly the Borrower shall apply all amounts raised by
it hereunder in or towards such purposes.
2.3 Condition Precedent Documents
Save as the Banks may otherwise agree the Borrower may not deliver:-
(i) the first Notice of Drawdown hereunder unless the Agent has
confirmed to the Borrower that it has received all of the
documents listed in Part 1 of the Third Schedule (Condition
Precedent Documents) (excepting those documents referred to in
paragraphs 6, 7, 15, 16, 17, 18, 19, 20, 22 and 23 thereof
which must be received, in form and substance acceptable to
the Agent, concurrently with the relevant Advance being made)
and that each is, in form and substance, satisfactory to the
Agent;
(ii) any Notice of Drawdown which is in connection with the
delivery of any New Vessel or Future Vessel unless the Agent
(without prejudice to Clause 13.11) has confirmed to the
Borrower that:
(a) it has received all of the relevant documents listed in
Part 2 of the Third Schedule (Condition Precedent
Documents) relating to the New Vessel (or Future Vessel)
to which such Facility relates (excepting those
documents referred to in paragraphs 7, 8, 9, 10, 11 and
12 of Part 2 of the Third Schedule, which must be
received, in form and substance acceptable to the Agent,
concurrently with the relevant Advance being made); and
(b) the Borrower has complied with its obligations under Clause 13.8.
(iii)and that each document referred to in (a) and (b) above is in a form and
substance satisfactory to the Agent.
2.4 Banks' Obligations Several
The obligations of each Bank hereunder are several and the failure by a
Bank to perform its obligations hereunder shall not affect the
obligations of the Borrower towards any other party hereto nor shall any
other party be liable for the failure by such Bank to perform its
obligations hereunder.
3. Utilisation of the Facilities
3.1 Drawdown Conditions
An Advance will be made by the Banks to the Borrower if:
(i) not more than ten nor less than three business days before the
proposed date for the making of such Advance, the Agent has
received from the Borrower a Notice of Drawdown therefor,
receipt of which shall oblige the Borrower to borrow the
amount therein requested on the date therein stated upon the
terms and subject to the conditions contained herein;
(ii) the proposed date for the making of such Advance is a business
day falling before the Commitment Termination Date;
(iii) the proposed date for the making of such Advance is not less
than five business days after the date upon which the previous
Advance (if any) was made hereunder;
(iv) the proposed amount of such Advance is in a minimum amount of
$5,000,000 and subject thereto an integral multiple of
$1,000,000 which is equal to or less than the amount of the A
Available Facility or, as the case may be, the B Available
Facility;
(v) there would not, immediately after the making of such Advance,
be more than six (6) Advances outstanding;
(vi) following the making of any Advance under the A Facility which
increases the amount of the Loan outstanding (other than the
first Advance) Loan 1 shall not exceed seventy-five per cent.
of the Estimated Value of Security Pool 1; Provided that in
relation to an Advance made in respect of the delivery of any
New Vessel from the Yard, the Borrower shall be entitled to
borrow up to $30,000,000 ($25,000,000, in the case of New
Vessel 4) or, if less, up to the Estimated Value of such New
Vessel notwithstanding that such Advance may cause such
percentage to be exceeded;
(vii) following the making of a B Advance which increases the amount
outstanding under the B Facility, Loan 2 shall not exceed
seventy five per cent of the Estimated Value of Security Pool
2;
(viii) the proposed Term of such Advance is a period of one, two,
three, six or twelve months (or such other periods as may be
agreed between the Borrower and the Banks) ending on or before
the Final Maturity Date;
(ix) no Event of Default or Potential Event of Default has occurred
and the representations set out in Clause 11 (Representations)
are true in all material respects on and as of the proposed
date for the making of such Advance; and
(x) following the making of a B Advance (and on the basis of the
statement which shall have been delivered pursuant to Clause
12.8, if applicable) Leverage shall not be more than 75%.
3.2 Each Bank's Participation
Each Bank will participate through its Facility Office in each Advance
made pursuant to Clause 3.1 (Drawdown Conditions) in the proportion
borne by its A Available Commitment to the A Available Facility (in the
case of an A Advance) or (in the case of a B Advance) in the proportion
borne by its B Available Commitment to the B Available Facility in
either case immediately prior to the making of that Advance.
3.3 Reduction of Available Commitment
If a Bank's A Commitment (or, as the case may be, its B Commitment) is
reduced in accordance with the terms hereof after the Agent has received
the Notice of Drawdown for an A Advance (or, as the case may be, a B
Advance), then the amount of that A Advance (or, as the case may be,
that B Advance) shall be reduced accordingly.
3.4 On the second anniversary of the Original Facility Date, the A
Commitment of each Bank shall be permanently reduced by the A Available
Commitment of such Bank immediately prior to such date and the B
Commitment of each Bank shall be permanently reduced by the B Available
Commitment of such Bank immediately prior to such date.
3.5 The first Advance hereunder shall be made under the A Facility which
shall be used to refinance the outstandings and related expenses under
the Citibank Revolver and the Chase Revolver and shall be in an amount
of $285,000,000.
Part 3
INTEREST
4. Payment and Calculation of Interest
4.1 Payment of Interest
On the Repayment Date relating to each Advance (and, in the case where a
Term has a duration exceeding six months, on the last day of the sixth
of those months) the Borrower shall pay accrued interest on that
Advance.
4.2 Calculation of Interest
The rate of interest applicable to an Advance from time to time during
its Term shall be the rate per annum which is the sum of the applicable
Margin 1 (or the applicable Margin 2 in the case of a B Advance) at such
time and LIBOR on the Quotation Date therefor.
4.3 For the purposes of determining the amount of accrued interest payable
on each Advance on an Interest Payment Date pursuant to Clause 4.1, the
Net Leverage (and accordingly the applicable Margin 1, or as the case
may be, the applicable Margin 2) shall be assumed to be as disclosed in
the most recent financial statements delivered pursuant to Clause 12.1
or Clause 12.2 Provided Always That if, on the basis of the financial
statements delivered in respect of the next following Quarter Date
(having regard to the proviso to the definition of "Margin 1" and the
proviso to the definition of "Margin 2") the Borrower has overpaid (or,
as the case may be, underpaid) interest then the amount so overpaid (or,
as the case may be, underpaid) shall be deducted from (or, as the case
may be, added to) the amount of interest which would otherwise have been
payable by the Borrower on the next following Interest Payment Date.
5. Market Disruption and Alternative Interest Rates
If, in relation to any Advance for which LIBOR falls to be determined in
accordance with the proviso to the definition thereof, the Agent
determines that at or about 11.00 a.m. (London time) on the Quotation
Date for the Term in respect of such Advance none of the Reference Banks
was offering to prime banks in the London Interbank Market deposits in
dollars for the proposed duration of such Term then, notwithstanding the
provisions of Clause 4 (Payment and Calculation of Interest) the length
of the Term of such Advance shall be one month (unless otherwise agreed)
and the rate of interest applicable to such Advance from time to time
during such Term shall be the rate per annum which is the sum of the
applicable Margin 1 (or the applicable Margin 2 in the case of a B
Advance) and the arithmetic mean of the respective rates per annum
notified to the Agent by each Bank before the last day of the Term to be
that which expresses as a percentage rate per annum the cost to it of
funding such Advance during such Term from whatever sources such Bank
may select (and the Agent shall notify the Borrower accordingly).
Part 4
REPAYMENT, REDUCTION, CANCELLATION AND PREPAYMENT
6. Repayment and Reduction
6.1 Repayment
The Borrower shall repay each Advance made to it in full on the
Repayment Date relating thereto.
6.2 Reduction
(i) subject always to Clause 7.4, on each of the following
Reduction Dates the Aggregate Total Commitments shall be
permanently reduced to the amounts shown opposite such dates
below:-
first Reduction Date $490,000,000
second Reduction Date $480,000,000
third Reduction Date $470,000,000
and not less than five business days prior to each Reduction
Date referred to above in this Clause 6.2(i) the Borrower
shall by notice in writing to the Agent specify whether the
relevant reduction on such Reduction Date shall be applied
against the Aggregate A Commitment or the Aggregate B
Commitment (and in default of such notice, the reduction on
the relevant Reduction Date shall be applied against the
Aggregate B Commitment);
(ii) subject always to Clause 7.4, and without prejudice to Clause 3.4, on each
Reduction Date (other than the Reduction Dates specified in (i) above and
the Final Maturity Date), the Aggregate A Commitment shall be permanently
reduced by an amount equal to one-twenty-fifth (1/25) of the Aggregate A
Commitment as at the second anniversary of the Original Facility Date and
the Aggregate B Commitment shall be permanently reduced by an amount equal
to one-twenty-fifth (1/25) of the Aggregate B Commitment as at the second
anniversary of the Original Facility Date, respectively Provided Always
That if, as at the second anniversary of the Original Facility Date, after
the application of Clause 3.4, and on the basis of the reductions specified
in this Clause 6.2(ii), the sum of the Aggregate A Commitment and the
Aggregate B Commitment on the penultimate Reduction Date (the "Balloon")
would exceed $150,000,000 then the proportion by which the Aggregate A
Commitment and the Aggregate B Commitment would otherwise be reduced on
each of the Reduction Dates specified in this Clause 6.2(ii) shall be
increased by such amount as shall ensure that the Balloon is equal to
$150,000,000 (without prejudice to any further cancellation or deemed
cancellation in accordance with the provisions of this Agreement pursuant
to which the Balloon would be further reduced); and
(iii) on the Final Maturity Date the Aggregate Total Commitments shall be
reduced to zero.
6.3 Rateable Reduction
Each reduction pursuant to Clause 6.2 of Aggregate A Commitment or, as
the case may be, Aggregate B Commitment, shall reduce the Banks' A
Commitments or, as the case may be, the Banks' B Commitments, pro rata.
In any event the amount of the Facilities shall be reduced to zero on
the Final Maturity Date.
6.4 Reduction of Outstandings
If on any date the Loan exceeds the Aggregate Total Commitments on such
date, the Borrower shall repay on such date the amount of the excess and
the repayment of such excess shall reduce the principal amount of such
Advance or Advances as is or are nominated by the Borrower.
6.5 Prepayment
The Borrower may, by giving to the Agent not less than fifteen business
days' notice to that effect, prepay (without penalty but subject to the
Borrower complying with Clause 16.4) the whole or any part of an Advance
(being an amount such that such Advance will be reduced by an amount or
integral multiple of $5,000,000).
6.6 Reborrowing of Prepayments
Subject to the other provisions of this Agreement, any prepayment made
by the Borrower pursuant to Clause 6.5 shall increase the amount of the
A Available Facility or the B Available Facility as the case may be and
may be reborrowed in accordance with the provisions of this Agreement.
6.7 No Other Repayments
The Borrower shall not repay or prepay all or any part of any Advance
outstanding hereunder except at the times and in the manner expressly
provided herein and, subject to the terms and conditions hereof, shall
be entitled to reborrow any amount repaid up to the Available Facilities
at such time.
7. Cancellation
7.1 Cancellation (i) the Borrower may, by giving to the Agent not less than
fifteen business days' prior notice to that effect, cancel the whole or any
part (being an amount or integral multiple of $5,000,000) of the Aggregate
Total Commitments; any such cancellation shall specify the relevant
Facility and shall be applied (a) pro rata against the scheduled reductions
in the Aggregate A Commitment or Aggregate B Commitment as the case may be,
as at each Reduction Date as determined pursuant to Clause 6.2 unless (b),
at the time the relevant notice of cancellation is given, the Borrower is
in breach of any provision of Clause 13.1, in which case the cancelled
amount shall be applied against the relevant Aggregate A Commitment or
Aggregate B Commitment as the case may be, as at each Reduction Date as
determined pursuant to Clause 6.2 in inverse chronological order.
(ii) any such cancellation shall reduce the relevant A Commitment,
or as the case may be, B Commitment, of each Bank rateably. No
premium or other compensation shall be payable by the Borrower
by reason of such cancellation.
(iii) if the Borrower decides not to exercise or does not exercise
its option to purchase New Vessel 4 from the Yard on or before
the Option Declaration Date, the Borrower shall forthwith
notify the Agent accordingly and an amount of $25,000,000 in
respect of the A Facility shall be cancelled automatically
with effect from the date that it has elected not to exercise
such option or the Option Declaration Date (whichever shall
first occur).
7.2 Notice of Cancellation
Any notice of cancellation given by the Borrower pursuant to Clause 7.1
(Cancellation) shall be irrevocable and shall specify the date upon
which such cancellation is to be made and the amount of such
cancellation.
7.3 Repayment of a Bank's Share of the Loan
If any Bank claims indemnification from the Borrower under Clause 8.2
(Tax Indemnity) or Clause 10.1 (Increased Costs), the Borrower may,
within thirty days thereafter and by not less than ten business days'
prior notice to the Agent (which notice shall be irrevocable), cancel
such Bank's Total Commitment whereupon such Bank shall cease to be
obliged to participate in further Advances and its Total Commitment
shall be reduced to zero.
7.4 Satisfaction of Clause 6.2
Subject always to Clause 6.4, the reductions in Aggregate Total
Commitment, Aggregate A Commitment or Aggregate B Commitment (as the
case may be) pursuant to Clause 6.2 (Reduction) shall be deemed to have
been satisfied to the extent a cancellation has been effected pursuant
to Clause 7.1 (Cancellation) and such cancellation has been applied in
accordance with Clause 7.1(i)(a) or Clause 7.1(iii) as the case may be.
Part 5
RISK ALLOCATION
8. Taxes
8.1 Tax Gross-up
All payments to be made by the Borrower to any person under any of the
Finance Documents shall be made free and clear of and without deduction
for or on account of tax unless the Borrower is required to make such a
payment subject to the deduction or withholding of tax, in which case
the sum payable by the Borrower in respect of which such deduction or
withholding is required to be made shall be increased to the extent
necessary to ensure that, after the making of the required deduction or
withholding, such person receives and retains (free from any liability
in respect of any such deduction or withholding) a net sum equal to the
sum which it would have received and so retained had no such deduction
or withholding been made or required to be made.
8.2 Tax Indemnity
Without prejudice to the provisions of Clause 8.1 (Tax Gross-up), if any
person or the Agent on its behalf is required to make any payment on
account of tax (not being a tax imposed on and calculated by reference
to the net income paid to and received by its Facility Office by the
jurisdiction in which it is incorporated or in which its Facility Office
is located) or otherwise on or in relation to any sum received or
receivable hereunder by such person or the Agent on its behalf
(including any sum received or receivable under this Clause 8) or any
liability in respect of any such payment is asserted, imposed, levied or
assessed against such person or the Agent on its behalf, the Borrower
shall, upon demand of the Agent, promptly indemnify such person against
such payment or liability, together with any interest, penalties, costs
and expenses payable or incurred in connection therewith Provided that
if a Bank or the Agent or the Trustee considers that it is reasonable to
do so and that it would not be otherwise prejudiced thereby, it will,
prior to instructing the Agent to make a demand under this Clause 8.2,
use reasonable endeavours to determine whether any such payment or
liability was correctly or legally imposed or asserted or could
reasonably be mitigated.
8.3 Claims by Banks
If a Bank or the Trustee intends to make a claim pursuant to Clause 8.2
(Tax Indemnity) it shall notify the Agent of the event by reason of
which it is entitled to do so and provide the Agent with a reasonable
written explanation of the basis and calculation of such claim,
whereupon the Agent shall notify the Borrower thereof and provide the
Borrower with a copy of the explanation and calculation which it has
received from such Bank or the Trustee Provided that nothing herein
shall require any Bank or the Trustee to disclose any confidential
information relating to the organisation of its affairs.
9. Tax Receipts and Credits
9.1 Notification of Requirement to Deduct Tax
If, at any time, the Borrower is required by law to make any deduction
or withholding from any sum payable by it under any of the Finance
Documents (or if thereafter there is any change in the rates at which or
the manner in which such deductions or withholdings are calculated), the
Borrower shall promptly notify the Agent, whereupon the Agent shall
notify the Banks and the Trustee accordingly.
9.2 Evidence of Payment of Tax
If the Borrower makes any payment under any of the Finance Documents in
respect of which it is required to make any deduction or withholding, it
shall pay the full amount required to be deducted or withheld to the
relevant taxation or other authority within the time allowed for such
payment under applicable law and shall deliver to the Agent for each
Bank, within thirty days after it has received the same an original
receipt (or a certified copy thereof) issued by such authority
evidencing the payment to such authority of all amounts so required to
be deducted or withheld in respect of that Bank's share of such payment.
9.3 Tax Credits
In the event that an additional payment is made under Clause 8.2 (Tax
Indemnity) and the person for whose benefit such payment is made, in its
sole opinion, determines that it has received or been granted a credit
against relief or remission for, or repayment of, any relevant tax paid
or payable by it in respect of or calculated with reference to the
deduction or withholding giving rise to the relevant payment or
liability, such person shall, to the extent that it can do so without
prejudice to the retention of the amount of such credit, relief,
remission or repayment, pay to the Borrower such amount as such person
shall, in its sole opinion, have concluded to be attributable to the
relevant payment or liability. Any such payment shall be conclusive
evidence of the amount due to the Borrower hereunder and shall be
accepted by the Borrower in full and final settlement of its rights of
reimbursement hereunder in respect of the relevant payment or liability.
Nothing herein contained shall interfere with the right of the Agent or
any Bank to arrange its tax affairs in whatever manner it thinks fit
and, in particular, neither the Agent nor any Bank shall be under any
obligation to claim credit, relief, remission or repayment from or
against its corporate profits or similar tax liability in respect of the
amount of the relevant payment or liability in priority to any other
claims, reliefs, credits or deductions available to it. Any such
reimbursement to be made by a Bank pursuant to this Clause 9.3 (Tax
Credits) shall be made as soon as possible after such credit or
remission or repayment has, in the reasonable opinion of such Bank, been
received or granted.
10.
Changes in Circumstances
10.1 Increased Costs
If, by reason of (i) any change in law or in its interpretation or
administration coming into effect after the Original Facility Date
and/or (ii) compliance with any Capital Adequacy Requirement or any
other request from or requirement of any central bank or other fiscal,
monetary or other authority coming into effect after the Original
Facility Date compliance with which is obligatory or customary for such
Bank:
(i) a Bank or any holding company of such Bank is unable to obtain
the rate of return on its overall capital which it would have
been able to obtain but for such Bank's entering into or
assuming or maintaining a commitment or performing its
obligations (including its obligation to participate in the
making of Advances) under this Agreement;
(ii) a Bank or any holding company of such Bank incurs a cost as a
result of such Bank's entering into or assuming or maintaining
a commitment or performing its obligations (including its
obligation to participate in the making of Advances) under
this Agreement;
(iii) there is any increase in the cost to a Bank or any holding
company of such Bank of funding or maintaining all or any of
the loans comprised in a class of loans formed by or including
such Bank's share of the Advances; or
(iv) a Bank or any holding company of such Bank becomes liable to
make any payment on account of tax or otherwise (not being a
tax imposed on and calculated by reference to the net income
paid to and received by such Bank's Facility Office by the
jurisdiction in which it is incorporated or in which its
Facility Office is located) on or calculated by reference to
the amount of such Bank's share of the Advances and/or to any
sum received or receivable by it hereunder,
then the Borrower shall, from time to time on demand of the Agent,
promptly pay to the Agent for the account of that Bank amounts
sufficient to hold harmless and indemnify that Bank or such Bank's
holding company from and against, as the case may be, (1) such reduction
in the rate of return on its overall capital, (2) such cost, (3) such
increased cost (or such proportion of such increased cost as is, in the
opinion of that Bank, attributable to its participating in the funding
or maintaining of Advances) or (4) such liability. No claim shall be
made by any Bank under this Clause 10.1 (Increased Costs) in respect of
any increased cost which arises out of a change to applicable law or
regulation affecting that Bank which has been issued prior to the date
of the first drawdown hereunder and compliance with which by that Bank
is commercially reasonable (including, without limitation, any reduction
in return or increased cost which arises as a consequence of any law or
directive implementing the Basle Paper in the manner in which it is
being implemented at the Original Facility Date).
10.2 Increased Costs Claims
A Bank intending to make a claim pursuant to Clause 10.1 (Increased
Costs) shall as soon as reasonably practicable after becoming aware of
the circumstance which would give rise to such a claim notify the Agent
of the event by reason of which it is entitled to do so and provide the
Agent with a reasonable written explanation of the basis and calculation
of such claim, whereupon the Agent shall promptly notify the Borrower
thereof and provide the Borrower with a copy of the explanation and
calculation which it has received from such Bank or Trustee Provided
that nothing herein shall require such Bank to disclose any confidential
information relating to the organisation of its affairs.
10.3 Illegality
If, at any time:
(i) it is unlawful for a Bank to make, fund or allow to remain
outstanding all or part of its share of the Advances, then
that Bank shall, promptly after becoming aware of the same,
deliver to the Borrower through the Agent a notice to that
effect and:
(a) such Bank shall not thereafter be obliged to participate
in the making of any Advances and the amount of its
Total Commitment shall be immediately reduced to zero;
and
(b) if the Agent on behalf of such Bank so requires, the
Borrower shall on such date as the Agent shall have
specified repay such Bank's share of any outstanding
Advances together with accrued interest thereon and all
other amounts owing to such Bank hereunder; or
(ii) it is or will become unlawful for the Borrower to perform or comply with
any or all of its obligations under any Finance Document or any of the
obligations of the Borrower under any Finance Document are not or will
cease to be legal valid and binding, the Agent may by notice to the
Borrower require the Borrower to enter into negotiations with a view to
amending the terms of such Finance Document in such a way as to ensure that
the Borrower's obligations thereunder remain substantially the same but are
lawful or, as the case may be, legal, valid and binding; if within thirty
days following any such notice from the Agent such Finance Document shall
not have been so amended, the Borrower shall, on such date as the Agent may
require, repay the Loan together with accrued interest thereon and any
other sums then due from the Borrower hereunder.
10.4 Mitigation
If circumstances arise which would (or would upon the giving of notice)
result in:
(i) the reduction of a Bank's Total Commitment pursuant to Clause 10.3
(Illegality) ;
(ii) the prepayment of a Bank's share of an Advance pursuant to Clause 10.3
(Illegality);
(iii) an increase in the amount of any payment to be made to or for
account of any Bank pursuant to Clause 8.1(Tax Gross-up); or
(iv) a claim by any Bank for indemnification pursuant to Clause 8.2
(Tax Indemnity) or a claim by any Bank for indemnification
pursuant to Clause 10.1 (Increased Costs),
then, without in any way limiting, reducing or otherwise qualifying the
obligations of the Borrower under any of the Clauses referred to above,
that Bank shall, in consultation with the Borrower and the Agent on
behalf of the Banks, take such reasonable steps as may be reasonably
open to it to mitigate the effects of such circumstances, including by
transferring its Facility Office to another jurisdiction or by assigning
its rights hereunder to another financial institution approved by the
Borrower Provided that no Bank shall have any obligation to transfer its
Facility Office or assign its rights hereunder as aforesaid if it is of
the opinion that to do so would or might have an adverse effect on its
business, operations or financial condition.
Part 6
REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT
11. Representations
Subject to any reservations and/or qualifications as to matter of law
which may be made in the legal opinions referred to in paragraphs 6, 7
and 16 of Part 1 and paragraph 8 of Part 2 of the Third Schedule, the
Borrower represents that:
(i) Status and Due Authorisation It is a corporation duly
organised under the laws of Bermuda with power to enter into
the Finance Documents and to exercise its rights and perform
its obligations under the Finance Documents and all corporate
and other action required to authorise its execution of the
Finance Documents and its performance of its obligations
thereunder has been duly taken.
(ii) No Deductions or Withholding Under the laws of Bermuda in
force at the date hereof, it will not be required to make any
deduction or withholding from any payment it may make under
any of the Finance Documents.
(iii) Claims Pari Passu (Without prejudice to the security to be
constituted by or pursuant to the Security Agreements) under
the laws of Bermuda in force at the date hereof, its
indebtedness hereunder will, to the extent that it exceeds the
realised value of the security therefor, rank at least pari
passu with all its other unsecured indebtedness save that
which is preferred solely by any bankruptcy, insolvency or
other similar laws of general application.
(iv) No Immunity In any proceedings taken in Bermuda in relation to
any of the Finance Documents, it will not be entitled to claim
for itself or any of its assets immunity from suit, execution,
attachment or other legal process.
(v) Governing Law and Judgments In any proceedings taken in
Bermuda in relation to any of the Finance Documents in which
there is an express choice of the law of a particular country
as the governing law thereof that choice of law and any
judgment obtained in that country will be recognised and
enforced.
(vi) Validity and Admissibility in Evidence As at the date hereof
all acts, conditions and things required to be done, fulfilled
and performed in order (a) to enable it lawfully to enter
into, exercise its rights under and perform and comply with
the obligations expressed to be assumed by it in the Finance
Documents, (b) to ensure that the obligations expressed to be
assumed by it in the Finance Documents are legal, valid and
binding and (c) to make the Finance Documents admissible in
evidence in Bermuda have been done, fulfilled and performed.
(vii) No Filing or Stamp Taxes Under the laws of Bermuda in force at
the date hereof, it is not necessary that any of the Finance
Documents be filed, recorded or enrolled with any court or
other authority in Bermuda other than the Registrar of
Companies or that any stamp, registration or similar tax be
paid on or in relation to any of the Finance Documents.
(viii) Binding Obligations The obligations expressed to be assumed by
it in the Finance Documents are legal and valid obligations
binding on it in accordance with the terms of the Finance
Documents.
The Borrower further represents that:
(ix) No Winding-up No member of the Borrower's Group has taken any
corporate action nor have any other steps been taken or legal
proceedings been started or (to the best of the Borrower's
knowledge and belief) threatened against any member of the
Borrower's Group for its winding-up, dissolution,
administration or re-organisation or for the appointment of a
receiver, administrator, administrative receiver, trustee or
similar officer of it or of any or all of its assets or
revenues.
(x) No Material Defaults No member of the Borrower's Group is in
breach of or in default under any agreement to which it is a
party or which is binding on it or any of its assets to an
extent or in a manner which might have a material adverse
effect on the business or financial condition of the
Borrower's Group as a whole.
(xi) No Material Proceedings No action or administrative proceeding
of or before any court or agency which is not covered by
insurance or which might have a material adverse effect on the
business or financial condition of any member of the
Borrower's Group has been started or is reasonably likely to
be started.
(xii) Original Consolidated Financial Statements The Original
Consolidated Financial Statements were prepared in accordance
with US GAAP and give (in conjunction with the notes thereto)
a true and fair view of the financial condition of the
Borrower's Group at the date as of which they were prepared
and the results of the Borrower's Group's operations during
the financial year then ended.
(xiii) No Material Adverse Change Since publication of the third
quarter results for 1998, there has been no material adverse
change in the business or financial condition of any member of
the Borrower's Group.
(xiv) No Undisclosed Liabilities As at the date as of which the
Original Consolidated Financial Statements were prepared no
member of the Borrower's Group had any liabilities (contingent
or otherwise) which were not disclosed thereby (or by the
notes thereto) or reserved against therein nor any unrealised
or anticipated losses arising from commitments entered into by
it which were not so disclosed or reserved against (other than
pursuant to the Soponata - Bona Guarantee).
(xv) No Obligation to Create Security Its execution of this
Agreement and its exercise of its rights and performance of
its obligations hereunder will not result in the existence of
nor oblige any member of the Borrower's Group to create any
encumbrance over all or any of its present or future revenues
or assets, other than pursuant to the Finance Documents.
(xvi) Execution of this Agreement Its execution of the Finance
Documents and its exercise of its rights and performance of
its obligations under any of the Finance Documents do not
constitute and will not result in any breach of any agreement
or treaty to which the Borrower is a party.
(xvii) Year 2000 Problem The Borrower believes (having made
reasonable enquiry) that the Year 2000 Problem (that is, the
risk that any computer hardware or software used by any member
of the Borrower's Group may be unable to recognise and perform
properly any date-sensitive functions involving a date before,
on, or after 31 December 1999) will not have a material
adverse effect on its ability to perform its obligations under
this Agreement.
(xviii) Money Laundering Any borrowing by it hereunder, and the
performance of its obligations hereunder and under the other
Finance Documents, will be for its own account and will not
involve any breach by it of any law or regulatory measure
relating to "money laundering" as defined in Article 1 of the
Directive (91/308/EEC) of the Council of the European
Communities.
12. Financial Information
12.1 Annual Statements
The Borrower shall as soon as the same become available, but in any
event within 180 days after the end of its financial years, deliver to
the Agent in sufficient copies for the Banks its consolidated and (if
requested by the Agent) unconsolidated financial statements for such
financial year.
12.2 Quarterly Statements
The Borrower shall as soon as the same become available, but in any
event within 60 days after the end of each quarterly accounting period
in each of its financial years, deliver to the Agent in sufficient
copies for the Banks its consolidated and (if requested by the Agent)
unconsolidated financial statements for such period.
12.3 Other Financial Information
The Borrower shall from time to time promptly on the request of the
Agent, furnish the Agent with such information about the business and
financial condition of itself and the Borrower's Group as the Agent may
reasonably require.
12.4 Any Communication
The Borrower shall as and when it despatches any communication to its
shareholders deliver to the Agent copies thereof in sufficient copies
for the Banks.
12.5 Requirements as to Financial Statements The Borrower shall ensure that:
(i) each set of financial statements delivered by it pursuant to
this Clause 12 is prepared on the same basis as was used in
the preparation of the Original Consolidated Financial
Statements and in accordance with US GAAP and consistently
applied;
(ii) each set of financial statements delivered by it pursuant to
this Clause 12 is certified by a duly authorised officer of
the Borrower as giving a true and fair view of its financial
condition or, as the case may be, the financial condition of
the Borrower's Group as at the end of the period to which
those financial statements relate and of the results of its
operations or, as the case may be, the Borrower's Group during
such period; and
(iii) each set of financial statements delivered by it pursuant to
Clause 12.1 (Annual Statements) has been audited by an
internationally recognised firm of independent auditors
qualified to audit accounts in accordance with US GAAP.
12.6 Estimated Value of Vessels and of Borrower's Group's Fleet
The Borrower shall (a) within thirty days of each Quarter Date, and (b)
not less than five business days prior to the proposed date for the
making of any B Advance deliver to the Agent:
(i) a summary showing the estimates of the Market Value of each of
the Vessels, and each of the other vessels in the Borrower's
Group's fleet, made by at least three recognised and
independent valuers acceptable to the Agent as at such Quarter
Date (or, as the case may be, as at a date not more than
thirty days prior to the proposed date for the making of such
B Advance),
(ii) a written estimate of the value of any other asset in each
Security Pool prepared (by a recognised and independent valuer
acceptable to the Agent) on the basis established when such
asset was introduced to such Security Pool,
each such estimate to be provided at the sole cost of the Borrower
Provided Always That if valuations have been supplied pursuant to Clause
12.6(i) and the proposed date for the making of such B Advance falls
less than 30 days after the Quarter Date in respect of which such
valuations were prepared, then the Borrower shall be obliged to comply
with Clause 12.6(ii) in respect of such B Advance only if the Agent so
requires.
12.7 Statement of Free Cash, Current Ratio and Leverage
On each date on which it delivers its consolidated and unconsolidated
financial statements pursuant to Clause 12.1 (Annual Statements) and
12.2 (Quarterly Statements), the Borrower shall deliver to the Agent a
statement showing the level of Free Cash, the Current Ratio and Leverage
as at such date, such statement to contain full details of how the same
were determined (if different from the method of the determination used
in the preparation of the previous such statement) and, in the case of
Leverage, to be based on the estimates of the Market Values of the
Vessels and each of the other vessels in the Borrower's Group's fleet
delivered at the same time as the Borrower's most recent consolidated
financial statements.
12.8 Statement of Leverage
On any date on which the Borrower delivers the estimates required to be
supplied pursuant to Clause 12.6(ii) in relation to a B Advance, the
Borrower shall also deliver to the Agent a statement showing the level
of Leverage as at such date (such statement of Leverage to be based on
the estimates of the Market Values of the Vessels so delivered pursuant
to Clause 12.6 (ii).
13. Financial Condition and Security
13.1 Financial Condition of the Borrower's Group
The Borrower shall ensure that at all times the consolidated financial
condition of the Borrower's Group, as evidenced by the Borrower's then
most recent consolidated financial statements shall be such that:
(i) Free Cash is at least $25,000,000 (without prejudice to Clause 13.4);
(ii) the Current Ratio is at least 1:1; and
(iii)Leverage is not more than 75% (or, if the Current Ratio is less than 2:1,
not more than 66.7%),
Provided that if the Borrower changes its accounting policies from those
adopted in its annual report for the year ended 31 December, 1997 or
from US GAAP generally, the Agent, following consultation with the
Borrower and acting on the instructions of the Banks, may by notice to
the Borrower specify an alternative to any of the requirements specified
in paragraphs (ii) and (iii) above which is logical having regard to the
changes in accounting policies that have occurred, in which event the
Borrower shall be obliged to ensure that at all times thereafter the
consolidated financial condition of the Borrower's Group, as evidenced
by the Borrower's then most recent consolidated financial statements, is
such as to meet the alternative requirement so specified
And Provided Further That if :
(iv) any member of the Parent's Group (for the purposes of this proviso a
"guarantor") shall have provided, in favour of the Trustee, a guarantee of
the Borrower's obligations hereunder; and
(v) such guarantee is secured by a first priority or first preferred mortgage
in favour of the Trustee over a vessel owned by such guarantor (together
with a first priority assignment of her insurances and earnings), such
guarantee, mortgage and other security documents being in form and
substance satisfactory to the Agent and consistent (so far as applicable)
with the form of the then existing Security Agreements (and recourse
against such guarantor under such guarantee may be limited to such mortgage
and other security documents); and
(vi) such vessel shall have been approved by the Agent acting on the
instructions of an Instructing Group
then, in calculating the Total Assets (and therefore the Leverage) for
the purposes of this Agreement there shall be deemed to be included, in
the value of Total Assets, the Market Value of any such vessel. Such
vessel shall, for the purposes of this Agreement, be a "Vessel" as
defined.
13.2 Remedy by Parent of Breaches of Financial Covenants
If the Parent or any other member of the Parent's Group has made
available any loan to, or has made an equity contribution in, any member
of the Borrower's Group and a group of Banks comprising an Instructing
Group determines in its discretion that the Borrower would otherwise be
in breach of any of the provisions of Clause 13.1, then the Borrower
shall ensure that the proceeds of such loan or equity contribution (and
whether such proceeds are cash or assets (including without limitation
vessels)) are secured in favour of the Trustee by way of additional
security for the Borrower's obligations hereunder, pursuant to security
documents in form and substance satisfactory to the Agent and (in the
case of security over vessels) consistent with the form of the then
existing Security Agreements.
13.3 Release of Additional Security
If, on the basis of the Borrower's most recent consolidated financial
statements delivered pursuant to Clause 12.1 or, as the case may be,
Clause 12.2,
(i) the Borrower is in compliance with each of the covenants assumed by it in
Clause 13.1 and 13.4; and
(ii) the Trustee has previously been supplied with additional security pursuant
to Clause 13.1 or 13.2,
then the Borrower may by written notice to the Trustee request that such
additional security be released, whereupon, provided no Event of Default
or Potential Event of Default shall have occurred and be continuing, and
the Borrower would thereafter still be in compliance with all its other
obligations under this Agreement, the Trustee shall promptly procure
that such additional security is released at the cost of the Borrower if
the Borrower would thereafter still be in compliance with such covenants
assumed by it in Clause 13.1 and 13.4, but on the assumption that the
value of such additional security were disregarded in the computation of
the Borrower's Free Cash, Current Assets, and Total Assets. For the
purpose of this Clause 13.3, the value of such additional security shall
be as determined by the Agent, acting reasonably, in the case of
additional security other than vessels and shall be determined on the
basis of the most recent estimates of Market Value supplied pursuant to
Clause 12.6, in the case of additional security constituting security
over vessels.
13.4 Free Cash Shortfall
If, on the basis of the Borrower's most recent consolidated financial
statements delivered pursuant to Clause 12.1 or, as the case may be,
Clause 12.2, the aggregate of
(i) Free Cash; and
(ii) the value of any additional security previously supplied to
the Trustee pursuant to this Clause 13.4 (such value to be as
determined on the basis of the most recent estimates of Market
Value supplied pursuant to Clause 12.6)
is less than the greater of
(iii) $75,000,000 x (balance of Loan
outstanding) ; and (375,000,000)
(iv) $25,000,000
(the amount by which the aggregate of Free Cash and the amount
referred to in (ii) above is less than the greater of (iii)
and (iv) above being the "Shortfall"), then, within ten
business days of receipt by the Borrower of written notice
from the Trustee to such effect, the Borrower shall provide
the Trustee additional security for the Borrower's obligations
under the Finance Documents over such vessel or vessels as
shall have previously been approved by the Trustee acting on
the instructions of an Instructing Group, such additional
security to be provided pursuant to security documents in form
and substance satisfactory to the Trustee and consistent with
the form of the then existing Security Agreements.
13.5 Release of Security for Free Cash Shortfall
If, on the basis of the Borrower's most recent consolidated financial
statements delivered pursuant to Clause 12.1 or, as the case may be,
Clause 12.2, the aggregate of Free Cash and the value of the additional
security referred to in paragraph 13.4(ii) above exceeds the amount
determined pursuant to paragraph 13.4(iii) or (iv), as the case may be,
and the Borrower has previously, pursuant to Clause 13.4, provided the
Trustee with additional security as referred to therein, then the
Borrower may by written notice to the Trustee, request that such
additional security be released, whereupon (provided no Event of Default
or Potential Event of Default shall have occurred and be continuing and
the Borrower would thereafter still be in compliance with all its other
obligations under this Agreement (including, without limitation Clause
13.1 and 13.4)) the Trustee shall promptly procure that the same is
released at the cost of the Borrower.
13.6 Loss or Sale of Vessel
If:-
(i) any Vessel shall become a total loss; or
(ii) any Vessel shall be sold,
then the Borrower shall within the period prescribed by Clause 13.7
(Time Periods) at the Borrower's option:
(a) prepay a portion of Loan 1 or, if such Vessel forms part
of the Security Pool 2, Loan 2 and/or
(b) provide to the Trustee additional security for its
obligations under the Finance Documents by way of an
encumbrance over dollar deposits and/or certificates of
deposit made by the Borrower with or, as the case may
be, issued in favour of the Borrower by a bank or
financial institution acceptable to the Agent, such
encumbrance to be created pursuant to a security
document in form and substance satisfactory to the
Agent; and/or
(c) provide to the Trustee additional security for the
Borrower's obligations under the Finance Documents over
such vessel or vessels as shall have previously been
approved by the Agent acting on the instructions of an
Instructing Group, such approval not to be unreasonably
withheld in the case of vessel(s) of a type and size
substantially comparable to the other Vessels, such
additional security to be provided pursuant to security
documents in form and substance satisfactory to the
Agent and consistent with the form of the then existing
Security Agreements
to the extent necessary to ensure that the Cover Ratio in respect of the
A Facility or, as the case may be, the B Facility is restored to the
level at which it was immediately before the occurrence of such total
loss or, as the case may be, the date of completion of such sale
Provided That a prepayment pursuant to Clause 13.6(a) shall be deemed
also to be a cancellation pursuant to Clause 7.1 (Cancellation) of the A
Facility, or, as the case may be, the B Facility, in the amount prepaid.
13.7 Time Periods
For the purposes of Clause 13.6 (Loss or Sale of Vessel) the period in
which the Borrower shall be obliged to do the things specified in Clause
13.6 (Loss or Sale of Vessel) shall be:
(i) where Clause 13.6(i) applies, on the earlier of the last day
of the Term of any current Advance during which the
requisition compensation or insurance proceeds in respect of
the relevant total loss were received and the date which falls
three months after the date of such total loss; and
(ii) where Clause 13.6(ii) applies, on the date of the completion
of the sale of the relevant Vessel.
13.8 Advances for New Vessels or Future Vessels
If the Borrower draws down any Advance to assist in financing or
refinancing the purchase price of any New Vessel or Future Vessel, as
the case may be, on its delivery to the Borrower, the Borrower
undertakes that on or before the date of delivery of such New Vessel or
Future Vessel, as the case may be, it will deliver to the Agent each of
the documents specified in Part 2 of the Third Schedule in relation to
such New Vessel, or Future Vessel, as the case may be, each such
document to be in such form and to be executed and delivered in such
manner as the Agent may reasonably require and as may be necessary to
ensure that any Security Agreement comprised therein provides effective
security for the performance by the Borrower of its obligations
hereunder Provided that if the Borrower does not draw down an Advance to
assist in financing or refinancing the purchase price of a New Vessel
within six months of the contractual delivery date in respect of such
New Vessel, (or, with the consent of the Agent, such consent not to be
unreasonably withheld or delayed, such longer period as the Borrower may
request, and having regard to any wish on the part of the Borrower not
to rescind the relevant building contract with the Yard) the provisions
of this Clause 13.8 (Advances for New Vessels or Future Vessels) shall
not apply and at the expiry of such six month period (or such longer
period as the case may be) the Aggregate A Commitment shall be
permanently reduced by $30,000,000 (or, in the case of New Vessel 4, by
$25,000,000), the A Commitment of each Bank being reduced pro rata.
13.9 Independent Valuation of New Vessels at Delivery
For the purpose of Clause 3.1(vi), and in respect of an Advance made in
respect of the delivery of a New Vessel, the Borrower shall, if the
Agent requires, procure that there shall have been furnished to the
Agent a summary showing the estimates of the Market Value of such Vessel
as at the expected delivery date prepared by at least three recognised
and independent valuers acceptable to the Agent (such estimates to be
dated no earlier than 30 days before such expected delivery date) and
for the purposes of Clause 3.1(vi) the Estimated Value of such New
Vessel shall be the average of such estimates.
13.10 Average Age of Vessels
If at any time the Average Age of the Vessels is more than fifteen years
the Borrower shall, within thirty business days (or such longer period
as the Agent, acting on the instructions of an Instructing Group, may
agree) after such has become the case, either (i) provide to the Trustee
substitute security for the Borrower's obligations under the Finance
Documents over such other newer vessel or vessels as shall have
previously been approved by the Agent acting on the instructions of an
Instructing Group (or, if such vessel(s) shall not be vessel(s)
currently in the Borrower's Group's fleet, approved by the Agent acting
on the instructions of the Instructing Group, such approval not to be
unreasonably withheld in the case of vessel(s) of a type and size
comparable to vessel(s) currently in the Borrower's Group's fleet), such
substitute security to be provided in place of the security over such
Vessel or Vessels as the Borrower may select pursuant to security
documents in form and substance satisfactory to the Agent and consistent
with the form of the then existing Security Agreements or (ii) request
the Security Trustee to release a Vessel or Vessels from the Security
Agreements applicable thereto and thereby bring the Average Age of
Vessels to fifteen years or below, which release the Security Trustee
shall promptly effect after whatever prepayment pursuant to Clause 6.5
(Prepayment), or cancellation pursuant to Clause 7.1 (Cancellation), is
necessary to ensure that after such release, the Cover Ratio will be
what it was immediately before such release Provided Always That any
such prepayment shall be deemed also to be a cancellation pursuant to
Clause 7.1 (Cancellation) of the A Facility (or, if such Vessel forms
part of Security Pool 2, the B Facility), in the amount prepaid.
13.11 Future Vessels
A proposal for the inclusion of a Future Vessel (or all the issued
shares in a company which itself owns such Future Vessel) in Security
Pool 2 shall be communicated in writing to the Agent by the Borrower and
acceptance of such proposal shall be subject to the approval of (and to
any conditions imposed by) an Instructing Group. Each Bank shall use its
reasonable endeavours to indicate its approval or otherwise to such a
proposal within 10 days of receipt by the Agent thereof from the
Borrower.
14. Covenants
The Borrower shall for so long as the Available Facilities exist
hereunder or the Borrower remains under any liability hereunder observe
the following covenants:
(i) Maintenance of Legal Validity The Borrower shall obtain,
comply with the terms of and do all that is necessary to
maintain in full force and effect all authorisations,
approvals, licences and consents required in or by the laws
and regulations of Bermuda and all other applicable
jurisdictions to enable it lawfully to enter into and perform
its obligations under the Finance Documents and to ensure the
legality, validity, enforceability or admissibility in
evidence in Bermuda and all other applicable jurisdictions of
the Finance Documents.
(ii) Notification of Events of Default The Borrower shall promptly,
upon becoming aware of the same, inform the Agent of the
occurrence of any Event of Default or Potential Event of
Default and, upon receipt of a written request to that effect
from the Agent, confirm to the Agent that, save as previously
notified to the Agent or as notified in such confirmation, no
Event of Default or Potential Event of Default has occurred.
(iii) Claims Pari Passu The Borrower shall ensure that at all times
the claims of the Agent, the Arrangers and the Banks against
it under this Agreement rank at least pari passu with the
claims of all its other unsecured creditors save those whose
claims are preferred by any bankruptcy, insolvency,
liquidation or other similar laws of general application.
(iv) Management of Vessels The Borrower shall ensure that the
Vessels (other than "Bona Fair") are at all times technically
and commercially managed by Bona Shipping AS or any other
subsidiary of the Borrower or of Teekay Shipping Corporation.
(v) Classification The Borrower shall ensure that the Vessels
maintain the highest class with Det norske Veritas or, as the
case may be, the Lloyds Register or such other classification
society as is acceptable to the Agent.
(vi) Indebtedness for Borrowed Money The Borrower shall procure
that, save pursuant to (a) this Agreement (b) the
Soponata-Bona Guarantee (c) the Existing Swaps and (d) its
obligations to make future capital contributions to Bona
Fortuna K/S and Bona Freighter K/S if and when called upon
to do so, neither it nor any of its subsidiaries shall incur
any indebtedness for borrowed money Provided Always that the
Borrower may incur indebtedness for borrowed money to the
Parent or any other member of the Parent's Group provided
that such indebtedness is subordinated to the Borrower's
obligations hereunder in terms satisfactory to the Agent
acting on the instructions of an Instructing Group and
provided further that the Borrower may incur indebtedness
for borrowed money to any person not being a member of the
Parent's Group and otherwise than pursuant to the foregoing
paragraphs (a) to (d) inclusive provided that such
indebtedness does not exceed $5,000,000 in aggregate.
(vii) No Charters in The Borrower shall not, and shall procure that
each of its subsidiaries shall not, charter in any vessel,
whether on time, bareboat or voyage charter.
(viii) Negative Pledge The Borrower shall not (other than pursuant
to, or as permitted by, the Security Agreements), and shall
procure that each of its subsidiaries shall not, create, or
permit to subsist, any encumbrance over all or any part of its
present or future revenues or assets.
(ix) Consolidation The Borrower shall not merge or consolidate with
any other entity except where the Borrower is the only
surviving entity.
(x) Registration The Borrower shall ensure that all the Vessels
are registered in Liberia, Bahamas, NIS or (with the consent
of the Agent, not to be unreasonably withheld or delayed) any
other international ship register.
(xi) ISM Compliance The Borrower shall comply (and procure that
the manager of any Vessel not managed by the Borrower
complies) with the ISM Code or any replacement thereof and
in particular (without prejudice to the generality of the
foregoing) ensure that it holds (or procure that the manager
of any Vessel not managed by the Borrower holds) a valid and
current Document of Compliance issued pursuant to the ISM
Code and a valid and current Safety Management Certificate
issued to each Vessel pursuant to the ISM Code; the Borrower
shall, promptly upon request from the Agent, supply the
Agent with copies of the foregoing documents.
(xii) Restriction on Charters The Borrower shall not charter any
Vessel to any member of the Parent's Group or to any
Affiliate.
15. Events of Default
If:
(i) Failure to Pay the Borrower fails to pay any amount of
principal due from it hereunder at the time, in the currency
and in the manner specified herein or, in the case of any sum
due from it hereunder other than principal, the Borrower fails
to pay such sum and such failure continues unremedied for five
business days or, in the case of sums payable on demand, ten
business days after demand has been duly made on the Borrower;
(ii) Misrepresentation any representation or statement made by any
Finance Party in any Finance Document to which it is a party
or in any notice or other document, certificate or statement
delivered by it pursuant thereto or in connection therewith is
or proves to have been incorrect or misleading in any material
respect when made;
(iii) Specific Covenants (a) the Borrower fails duly to perform
or comply with any of the obligations expressed to be
assumed by it in Clause 14 (iv) (Management of Vessels),
Clause 14 (vi) (Indebtedness for Borrowed Money), Clause 14
(ix) (Consolidation) or Clause 14(ix) (Registration) or (b)
the Borrower fails duly to perform or comply with any of the
obligations expressed to be assumed by it in Clause 14(i)
(Maintenance of Legal Validity), Clause 14(ii) (Notification
of Events of Default), Clause 14(iii) (Claims Pari Passu) or
Clause 14(v) (Classification) and such failure is not
remedied within thirty days after the Agent has given notice
thereof to the Borrower or (c) the Guarantor fails duly to
perform or comply with any of the obligations expressed to
be assumed by it in Clause 5 of the Guarantee or (d) the
Guarantor fails duly to perform or comply with any of the
obligations expressed to be assumed by it in Clause 6 of the
Guarantee and such failure is not remedied within 30 days
after the Agent has given written notice thereof to the
Guarantor;
(iv) Financial Condition at any time any of the requirements of
Clause 13 (Financial Condition and Security) are not
satisfied;
(v) Other Obligations the Borrower fails duly to perform or comply
with any other obligation expressed to be assumed by it in any
Finance Document and such failure is not remedied within
thirty days after the Agent has given notice thereof to the
Borrower;
(vi) Cross Default (a) any indebtedness of the Parent, any Material
Subsidiary, or any Affiliate is not paid when due (or within
any applicable grace period applicable thereto) or any
indebtedness of the Parent, any Material Subsidiary, or any
Affiliate is declared to be or otherwise becomes due and
payable prior to its specified maturity and (b) the aggregate
of all such unpaid or accelerated indebtedness referred to in
(a) above exceeds $5,000,000 or its equivalent in any other
currency;
(vii) Insolvency and Rescheduling the Parent, any Material
Subsidiary, or any Affiliate is unable to pay its debts as
they fall due, commences negotiations with any one or more of
its creditors with a view to the general readjustment or
rescheduling of its indebtedness or makes a general assignment
for the benefit of its creditors or a composition with its
creditors;
(viii) Winding-up (otherwise than for the purposes of a
reconstruction on terms previously approved by the Agent
acting on the instructions of an Instructing Group) the
Parent, any Material Subsidiary, or any Affiliate takes any
corporate action or other steps are taken or legal proceedings
are started for its winding-up, dissolution, administration or
re-organisation or for the appointment of a liquidator,
receiver, administrator, administrative receiver, conservator,
custodian, trustee or similar officer of it or of any or all
of its revenues and assets;
(ix) Execution or Distress (a) any execution or distress for an
aggregate amount of $5,000,000 (or its equivalent) in any
other currency is levied against, or an encumbrancer takes
possession of, the whole or any part of, the property,
undertaking or assets of any member of the Parent's Group or
any Affiliate (other than any execution or distress which is
being contested in good faith and which is either discharged
within thirty days or in respect of which adequate security
has been provided within thirty days to the relevant court
or other authority to enable the relevant execution or
distress to be lifted or released), or (b) any member of the
Parent's Group or any Affiliate fails (within thirty days of
being obliged to do so) to comply with or pay any sum for an
aggregate amount in excess of $5,000,000 (or its equivalent
in any other currency) due from it under any final judgment
(being one against which there is no appeal or if a right of
appeal exists, the time limit for making such appeal has
expired) or any final order (being one against which there
is no appeal or if a right of appeal exists, the time limit
for making such appeal has expired) made or given by any
court of competent jurisdiction;
(x) Governmental Intervention by or under the authority of any
government, (a) the management of the Parent or any Material
Subsidiary is wholly or partially displaced or the authority
of the Parent or any Material Subsidiary in the conduct of
its business is wholly or partially curtailed or (b) all or
a majority of the issued shares of the Parent or any
Material Subsidiary or the whole or any part (the market
value of which is ten per cent. or more of the market value
of the whole) of the Parent or any Material Subsidiary's
revenues or assets are seized, nationalised, expropriated or
compulsorily acquired;
(xi) Insurance the Borrower fails to insure any Vessel in
accordance with the requirements of any Security Agreement
relating thereto;
(xii) Repudiation any Finance Party repudiates any Finance Document
to which it is a party or does or causes to be done any act or
thing evidencing an intention to repudiate any such Finance
Document;
(xiii) Validity and Admissibility at any time any act, condition
or thing required to be done, fulfilled or performed in
order (a) to enable any Finance Party lawfully to enter
into, exercise its rights under and perform the respective
obligations expressed to be assumed by it in the Finance
Documents, (b) to ensure that the obligations expressed to
be assumed by the Finance Parties in the Finance Documents
are legal, valid and binding or (c) to make the Finance
Documents admissible in evidence in any applicable
jurisdiction is not done, fulfilled or performed within
thirty days after notification from the Agent to the
Borrower requiring the same to be done, fulfilled or
performed;
(xiv) Illegality at any time it is or becomes unlawful for any
Finance Party to perform or comply with any or all of its
obligations under the Finance Documents to which it is a party
or any of the obligations of the relevant Finance Party
hereunder are not or cease to be legal, valid and binding and
such illegality is not remedied or mitigated to the
satisfaction of the Agent within thirty days after the Agent
has given notice thereof to the Borrower;
(xv) Material Adverse Change at any time there shall occur a change
in the financial condition of any Finance Party or any
Material Subsidiary which materially impairs such Finance
Party's ability to discharge its obligations under the Finance
Documents to which it is a party in the manner provided
therein;
(xvi) Ownership of Borrower The Parent ceases to own beneficially
one hundred per cent. of the issued shares of the Borrower; or
(xvii) Ownership of Parent at any time more than fifty per cent.
(50%) of the issued shares of the Parent shall be beneficially
owned (whether directly or indirectly) by any one person or
any group or persons acting in concert (other than Cirrus
Trust, JTK Trust or any successor thereto)
then, and in any such case and at any time thereafter (if such
Event of Default is continuing), the Agent may (and, if so
instructed by an Instructing Group, shall) by written notice
to the Borrower:
(a) declare the Loan to be immediately due and payable
(whereupon the same shall become so payable together
with accrued interest thereon and any other sums then
owed by the Borrower hereunder) or declare the Loan to
be due and payable on demand of the Agent; and/or
(b) declare that the Available Facilities shall be
cancelled, whereupon the same shall be cancelled and the
amount of each Bank's Total Commitment shall be reduced
to zero
Provided Always That for the purposes of a declaration under
Clause 15(a) or 15(b) in relation only to the Event of Default
referred to in Clause 15(xvii) (Ownership of Parent), the
definition of "Instructing Group" shall be construed as if the
expression "66 2/3 per cent" were replaced by the expression
"50 per cent" wherever it occurs.
15.1 If, pursuant to Clause 15, the Agent declares the Loan to be due and
payable on demand of the Agent, then, and at any time thereafter, the
Agent may (and, if so instructed by an Instructing Group, shall) by
written notice to the Borrower:
(i) call for repayment of the Loan on such date as it may specify
in such notice (whereupon the same shall become due and
payable on such date together with accrued interest thereon
and any other sums then owed by the Borrower hereunder) or
withdraw its declaration with effect from such date as it may
specify in such notice; and/or
(ii) select as the duration of any Term relating to an Advance
which begins whilst such declaration remains in effect a
period of six months or less.
Part 7
DEFAULT INTEREST AND INDEMNITY
16. Default Interest and Indemnity
16.1 Default Interest Periods
If any sum due and payable by the Borrower hereunder is not paid on the
due date therefor in accordance with the provisions of Clause 18
(Payments) or if any sum due and payable by the Borrower under any
judgment of any court in connection herewith is not paid on the date of
such judgment, the period beginning on such due date or, as the case may
be, the date of such judgment and ending on the date upon which the
obligation of the Borrower to pay such sum (the balance thereof for the
time being unpaid being herein referred to as an "unpaid sum") is
discharged shall be divided into successive periods, each of which
(other than the first) shall start on the last day of the preceding such
period and the duration of each of which shall (except as otherwise
provided in this Clause 16) be selected by the Agent.
16.2 Default Interest
During each such period relating thereto as is mentioned in Clause 16.1
(Default Interest Periods) an unpaid sum shall bear interest at the rate
per annum which is the sum from time to time of two per cent., the
applicable Margin 1 (or the applicable Margin 2, in the case of a B
Advance) at such time, and LIBOR on the Quotation Date therefor Provided
that:
(i) if in relation to any such period LIBOR falls to be
determined in accordance with the proviso to the definition
thereof and none of the Reference Banks was offering dollar
deposits for the requisite period, the rate of interest
applicable to such unpaid sum during such period shall be
the arithmetic mean (rounded upwards, if not already such a
multiple, to the nearest whole multiple of one-thirty-second
of one per cent.) of the rates notified by each Bank to the
Agent before the last day of such period to be those which
express as a percentage rate per annum the cost to it of
funding from whatever source it may select its portion of
such unpaid sum for such period; and
(ii) if such unpaid sum is all or part of an Advance which became
due and payable on a day other than the last day of an
Interest Period relating thereto, the first such period
applicable thereto shall be of a duration equal to the
unexpired portion of that Interest Period and the rate of
interest applicable thereto during such period shall be that
which exceeds by two per cent. the rate which would have been
applicable to it had it not so fallen due.
16.3 Payment of Default Interest
Any interest which shall have accrued under Clause 16.2 (Default
Interest) in respect of an unpaid sum shall be due and payable and shall
be paid by the Borrower at the end of the period by reference to which
it is calculated or on such other dates as the Agent may specify by
written notice to the Borrower.
16.4 Broken Periods
If any Bank or the Agent on its behalf receives or recovers all or any
part of such Bank's share of an Advance otherwise than on the last day
of the Term thereof, the Borrower shall pay to the Agent on demand for
account of such Bank an amount equal to the amount (if any) by which (a)
the additional interest which would have been payable on the amount so
received or recovered had it been received or recovered on the last day
of the Term thereof exceeds (b) the amount of interest which in the
opinion of the Agent would have been payable to the Agent on the last
day of the Term thereof in respect of a dollar deposit equal to the
amount so received or recovered placed by it with a prime bank in London
for a period starting on the third business day following the date of
such receipt or recovery and ending on the last day of the Term thereof.
16.5 Borrower's Indemnity
The Borrower undertakes to indemnify:
(i) each of the Agent, the Arrangers, the Banks and the Trustee
against any cost, claim, loss, expense (including legal fees)
or liability together with any VAT thereon, which any of them
may reasonably sustain or incur as a consequence of the
occurrence of any Event of Default or any default by any
Finance Party in the performance of any of the obligations
expressed to be assumed by it in any of the Finance Documents;
and
(ii) each Bank against any loss it may suffer or reasonably incur
as a result of its funding or making arrangements to fund its
portion of an Advance requested by the Borrower hereunder but
not made by reason of the operation of any one or more of the
provisions hereof (but excluding any loss arising by reason of
that Bank's default).
Each claim for an indemnity from the Borrower under this Clause shall be
accompanied by a written explanation supporting such claim.
16.6 Unpaid Sums as Advances
Any unpaid sum shall (for the purposes of this Clause 16 (Default
Interest and Indemnity) and Clause 10.1 (Increased Costs)) be treated as
an advance and accordingly in this Clause 16 and Clause 10.1 (Increased
Costs)) the term "Advance" includes any unpaid sum and "Term", in
relation to an unpaid sum, includes each such period relating thereto as
is mentioned in Clause 16.1 (Default Interest Periods).
Part 8
PAYMENTS
17. Currency of Account and Payment
17.1 Currency of Account
The dollar is the currency of account and payment for each and every sum
at any time due from the Borrower hereunder Provided that:
(i) each payment in respect of costs and expenses shall be made
in the currency in which the same were incurred; and
(ii) each payment pursuant to Clause 8.2 (Tax Indemnity) or Clause
10.1 (Increased Costs) shall be made in the currency specified
by the party claiming thereunder.
17.2 Currency Indemnity
If any sum due from the Borrower under any Finance Document or any order
or judgment given or made in relation thereto has to be converted from
the currency (the "first currency") in which the same is payable
hereunder or under such order or judgment into another currency (the
"second currency") for the purpose of (a) making or filing a claim or
proof against the Borrower, (b) obtaining an order or judgment in any
court or other tribunal or (c) enforcing any order or judgment given or
made in relation hereto, the Borrower shall indemnify and hold harmless
each of the persons to whom such sum is due from and against any loss
suffered or incurred as a result of any discrepancy between (i) the rate
of exchange used for such purpose to convert the sum in question from
the first currency into the second currency and (ii) the rate or rates
of exchange at which such person may in the ordinary course of business
purchase the first currency with the second currency upon receipt of a
sum paid to it in satisfaction, in whole or in part, of any such order,
judgment, claim or proof.
18. Payments
18.1 Payments to the Agent
On each date on which this Agreement requires an amount denominated in
dollars to be paid by the Borrower or any of the Banks hereunder, the
Borrower or, as the case may be, such Bank shall make the same available
to the Agent by payment in dollars and in same day funds (or in such
other funds as may for the time being be customary in New York City for
the settlement in New York City of international banking transactions in
dollars) to Citibank, N.A., New York for further account Citibank
International plc account number ▇▇▇▇▇▇▇▇ (or such other account or bank
as the Agent may have specified for this purpose).
18.2 Alternative Payment Arrangements
If, at any time, it shall become impracticable (by reason of any action
of any governmental authority or any change in law, exchange control
regulations or any similar event) for the Borrower to make any payments
hereunder in the manner specified in Clause 18.1 (Payments to the
Agent), then the Borrower may agree with each or any of the Banks
alternative arrangements for the payment direct to such Bank of amounts
due to such Bank hereunder Provided that, in the absence of any such
agreement with any Bank, the Borrower shall be obliged to make all
payments due to such Bank in the manner specified herein. Upon reaching
such agreement the Borrower and such Bank shall immediately notify the
Agent thereof and shall thereafter promptly notify the Agent of all
payments made direct to such Bank.
18.3 Payments by the Agent
Save as otherwise provided herein, each payment received by the Agent
for the account of another person pursuant to Clause 18.1 (Payments to
the Agent) shall:
(i) in the case of a payment received for the account of the
Borrower, be made available by the Agent to the Borrower by
application:
(a) first, in or towards payment the same day of any amount
then due from the Borrower hereunder to the person from
whom the amount was so received; and
(b) secondly, in or towards payment the same day to the
account of the Borrower with such bank in New York City
as the Borrower shall have previously notified to the
Agent for this purpose; and
(ii) in the case of any other payment, be made available by the
Agent to the person for whose account such payment was
received (in the case of a Bank, for the account of the
Facility Office) for value the same day by transfer to such
account of such person with such bank in New York City as such
person shall have previously notified to the Agent.
18.4 No Set-off
All payments required to be made by the Borrower under any of the
Finance Documents shall be calculated without reference to any set-off
or counterclaim and shall be made free and clear of and without any
deduction for or on account of any set-off or counterclaim.
18.5 Clawback
Where a sum is to be paid hereunder to the Agent for account of another
person, the Agent shall not be obliged to make the same available to
that other person until it has been able to establish to its
satisfaction that it has actually received such sum, but if it does so
and it proves to be the case that it had not actually received such sum,
then the person to whom such sum was so made available shall on request
refund the same to the Agent together with an amount sufficient to
indemnify the Agent against any cost or loss it may have suffered or
reasonably incurred by reason of its having paid out such sum prior to
its having received such sum.
19. Set-Off
19.1 Contractual Set-off
The Borrower authorises each Bank at any time following the occurrence
of an Event of Default (and so long as the same is continuing) to apply
any credit balance to which the Borrower is entitled on any account of
the Borrower with that Bank in satisfaction of any sum due and payable
from the Borrower to such Bank under any of the Finance Documents but
unpaid; for this purpose, each Bank is authorised to purchase with the
moneys standing to the credit of any such account such other currencies
as may be necessary to effect such application.
19.2 Set-off not Mandatory
No Bank shall be obliged to exercise any right given to it by Clause
19.1 (Contractual Set-off).
20. Sharing
20.1 Redistribution of Payments
If, at any time, the proportion which any Bank (a "Recovering Bank") has
received or recovered (whether by payment, the exercise of a right of
set-off or combination of accounts or otherwise) in respect of its
portion of any payment (a "relevant payment") to be made under this
Agreement by the Borrower for account of such Recovering Bank and one or
more other Banks is greater (the portion of such receipt or recovery
giving rise to such excess proportion being herein called an "excess
amount") than the proportion thereof so received or recovered by the
Bank or Banks so receiving or recovering the smallest proportion
thereof, then:
(i) such Recovering Bank shall inform the Agent of such receipt or
recovery and pay to the Agent an amount equal to such excess
amount;
(ii) there shall thereupon fall due from the Borrower to such
Recovering Bank an amount equal to the amount paid out by such
Recovering Bank pursuant to paragraph (i) above, the amount so
due being, for the purposes hereof, treated as if it were an
unpaid part of such Recovering Bank's portion of such relevant
payment; and
(iii) the Agent shall treat the amount received by it from such
Recovering Bank pursuant to paragraph (i) above as if such
amount had been received by it from the Borrower in respect of
such relevant payment and shall pay the same to the persons
entitled thereto (including such Recovering Bank) pro rata to
their respective entitlements thereto,
Provided that to the extent that any excess amount is attributable to a
payment to a Bank pursuant to paragraph (i)(a) of Clause 18.3 (Payments
by the Agent) such portion of such excess amount as is so attributable
shall not be required to be shared pursuant hereto.
20.2 Repayable Recoveries
If any sum (a "relevant sum") received or recovered by a Recovering Bank
in respect of any amount owing to it by the Borrower becomes repayable
and is repaid by such Recovering Bank, then:
(i) each Bank which has received a share of such relevant sum by
reason of the implementation of Clause 20.1 (Redistribution of
Payments) shall, upon request of the Agent, pay to the Agent
for account of such Recovering Bank an amount equal to its
share of such relevant sum; and
(ii) there shall thereupon fall due from the Borrower to each such
Bank an amount equal to the amount paid out by it pursuant to
paragraph (i) above, the amount so due being, for the purposes
hereof, treated as if it were the sum payable to such Bank
against which such Bank's share of such relevant sum was
applied.
Part 9
FEES, COSTS AND EXPENSES
21. Commitment Commission and Fees
21.1 Commitment Commission
The Borrower shall pay to the Agent for the account of each Bank a
commitment commission on the amount of such Bank's A Available
Commitment and B Available Commitment from day to day during the period
beginning on the Original Facility Date up to (but not including) the
Commitment Termination Date, such commitment commission to be calculated
at the rate of one half of the applicable Margin 1 from time to time in
the case of such Bank's A Available Commitment and one half of the
applicable Margin 2 from time to time in the case of such Bank's B
Available Commitment.
Commitment commission shall be payable in arrear on the last day of each
successive period of three months starting from the Original Facility
Date and on the Final Maturity Date (each such date a "Commitment
Commission Payment Date") Provided Always That for the purposes of
determining the amount of accrued commitment commission payable on each
Commitment Commission Payment Date the Net Leverage (and accordingly the
applicable Margin 1, or as the case may be, the applicable Margin 2)
shall be assumed to be as disclosed in the most recent financial
statements delivered pursuant to Clause 12.1 (Annual Statements) or
Clause 12.2 (Quarterly Statements) Provided Further That if, on the
basis of the financial statements delivered in respect of the next
following Quarter Date (having regard to the proviso to the definition
of "Margin 1" and the proviso to the definition of "Margin 2") the
Borrower has overpaid (or, as the case may be, underpaid) commitment
commission then the amount so overpaid (or, as the case may be,
underpaid) shall be deducted from (or, as the case may be, added to) the
amount of commitment commission which would otherwise have been payable
by the Borrower on the next following Commitment Commission Payment
Date.
21.2 Participation Fee
The Borrower shall pay to the Agent on the dates therein specified the
arrangement fees specified in the letter of even date herewith from the
Agent to the Borrower, such fees to be distributed by the Agent among
the Banks in the proportions agreed between the Banks prior to the
Original Facility Date.
21.3 Agency Fee
The Borrower shall pay to the Agent for its own account the agency fees
specified in the letter dated the Original Facility Date from the Agent
to the Borrower, such agency fees to be paid at the times, and in the
amounts, specified in such letter.
22. Costs and Expenses
22.1 Transaction Expenses
The Borrower shall, from time to time on demand of the Agent, reimburse
each of the Agent, the Arrangers and the Trustee for all out of pocket
costs and expenses (including reasonable legal fees) together with any
VAT thereon reasonably incurred by it in connection with the
negotiation, preparation and execution of the Finance Documents, any
amendment and/or supplement to or any waiver of any of the obligations
of any Finance Party under the Finance Documents and the completion of
the transactions herein contemplated.
22.2 Preservation and Enforcement of Rights
The Borrower shall, from time to time on demand of the Agent, reimburse
the Agent, the Arrangers and the Banks for all costs and expenses
(including legal fees) together with any VAT thereon reasonably incurred
in or in connection with the preservation and/or enforcement of any of
the rights of the Agent, the Arrangers and the Banks under the Finance
Documents.
22.3 Stamp Taxes
The Borrower shall pay all stamp, registration and other taxes to which
any Finance Document or any judgment given in connection therewith is or
at any time may be subject and shall, from time to time on demand of the
Agent, indemnify the Agent, the Arrangers and the Banks against any
liabilities, costs, claims and expenses resulting from any failure to
pay or any delay in paying any such tax.
22.4 Banks' Liabilities for Costs
If the Borrower fails to perform any of its obligations under this
Clause 22 (Costs and Expenses), each Bank shall, in its Proportion,
indemnify each of the Agent and the Arrangers against any loss incurred
by any of them as a result of such failure and the Borrower shall
forthwith reimburse each Bank for any payment made by it pursuant to
this Clause 22.4.
Part 10
AGENCY PROVISIONS
23. The Agent, the Trustee, the Arrangers and the Banks
23.1 Appointment of the Agent and the Trustee
The Arrangers and each Bank hereby appoints the Agent and the Trustee to
act as its agent in connection with this Agreement and each other
Finance Document and authorises each of the Agent and the Trustee to
exercise such rights, powers, authorities and discretions as are
specifically delegated to the Agent by the terms of the Finance
Documents together with all such rights, powers, authorities and
discretions as are reasonably incidental thereto. The provisions of this
Clause 23 are, in the case of the Trustee, without prejudice to the
provisions of the Security Trust Deed and, in the event of any conflict
between this Clause 23 and the Security Trust Deed, the provisions of
the Security Trust Deed will prevail.
23.2 Agent's and the Trustee's Discretions
Each of the Agent and the Trustee may:
(i) assume, unless it has, in its capacity as agent for the Banks,
received notice to the contrary from any other party hereto,
that (i) any representation made by any Finance Party in
connection with any of the Finance Documents is true, (ii) no
Event of Default or Potential Event of Default has occurred,
(iii) no Finance Party is in breach of or default under its
obligations under any of the Finance Documents and (iv) any
right, power, authority or discretion vested therein upon an
Instructing Group, the Banks or any other person or group of
persons has not been exercised;
(ii) assume that the Facility Office of each Bank is that
identified with its signature below (or, in the case of a
Transferee, at the end of the Transfer Certificate to which it
is a party as Transferee) until it has received from such Bank
a notice designating some other office of such Bank to replace
its Facility Office and act upon any such notice until the
same is superseded by a further such notice;
(iii) engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or
services may to it seem necessary, expedient or desirable and
rely upon any advice so obtained;
(iv) rely (as to any matters of fact which might reasonably be
expected to be within the knowledge of any Finance Party) upon
a certificate signed by or on behalf of such Finance Party;
(v) rely upon any communication or document believed by it to be genuine;
(vi) refrain from exercising any right, power or discretion vested
in it as agent hereunder unless and until instructed by an
Instructing Group as to whether or not such right, power or
discretion is to be exercised and, if it is to be exercised,
as to the manner in which it should be exercised; and
(vii) refrain from acting in accordance with any instructions of an
Instructing Group to begin any legal action or proceeding
arising out of or in connection with any Finance Document
until it shall have received such security as it may require
(whether by way of payment in advance or otherwise) for all
costs, claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which it will or may
expend or incur in complying with such instructions.
23.3 Agent's and Trustee's Obligations
The Agent and the Trustee shall:
(i) promptly inform each Bank of the contents of any notice or
document received by it in its capacity as Agent or Trustee
from any Finance Party under any Finance Document;
(ii) promptly notify each Bank of the occurrence of any Event of
Default or any default by any Finance Party in the due
performance of or compliance with its obligations under any
Finance Document of which the Agent or the Trustee has notice
from any other party hereto;
(iii) save as otherwise provided herein or therein, act as agent or
trustee under the Finance Documents in accordance with any
instructions given to it by an Instructing Group, which
instructions shall be binding on all of the Banks; and
(iv) if so instructed by an Instructing Group, refrain from
exercising any right, power or discretion vested in it as
agent hereunder or under any of the other Finance Documents.
23.4 Excluded Obligations
Notwithstanding anything to the contrary expressed or implied herein,
none of the Agent, the Trustee or the Arrangers shall:
(i) be bound to enquire as to (i) whether or not any
representation made by the any Finance Party in connection
with any Finance Document is true, (ii) the occurrence or
otherwise of any Event of Default or Potential Event of
Default, (iii) the performance by any Finance Document of its
obligations under any of the Finance Documents or (iv) any
breach of or default by any Finance Party of or under its
obligations thereunder;
(ii) be bound to account to any Bank for any sum or the profit
element of any sum received by it for its own account;
(iii) be bound to disclose to any other person any information
relating to any member of the Parent's Group if such
disclosure would or might in its opinion constitute a breach
of any law or regulation or be otherwise actionable at the
suit of any person; or
(iv) be under any obligations other than those for which express provision is
made herein.
23.5 Indemnification
Each Bank shall, in its Proportion, from time to time on demand by the
Agent or, as the case may be, the Trustee, indemnify the Agent, against
any and all reasonable costs, claims, losses, expenses (including legal
fees) and liabilities together with any VAT thereon which the Agent or,
as the case may be, the Trustee may incur, otherwise than by reason of
its own gross negligence or wilful misconduct, in acting in its capacity
as agent or trustee under any of the Finance Documents Provided Always
That this Clause 23.5 (Indemnification) shall not apply to any cost,
claim, loss, expense or liability expressed to be recoverable from the
Borrower under Clause 22.1 (Transaction Expenses), 22.2 (Preservation
and Enforcement of Rights) or 22.3 (Stamp Taxes) (but without prejudice
to Clause 22.4 (Bank's Liabilities for Costs)).
23.6 Exclusion of Liabilities
Neither the Agent, the Trustee and the Arrangers nor any of them accepts
any responsibility for the accuracy and/or completeness of any
information supplied by the any Finance Party in connection with any of
the Finance Documents or for the legality, validity, effectiveness,
adequacy or enforceability of any of the Finance Documents and neither
the Agent, the Trustee and the Arrangers nor any of them shall be under
any liability as a result of taking or omitting to take any action in
relation to any of the Finance Documents, save in the case of gross
negligence or wilful misconduct.
23.7 No Actions
Each of the Banks agrees that it will not assert or seek to assert
against any director, officer or employee of the Agent, the Trustee or
Arrangers any claim it might have against any of them in respect of the
matters referred to in Clause 23.6 (Exclusion of Liabilities).
23.8 Business with the Parent's Group
The Agent, the Trustee and the Arrangers may accept deposits from, lend
money to and generally engage in any kind of banking or other business
with any member of the Parent's Group.
23.9 Resignation
Each of the Agent and the Trustee may resign its appointment under any
Finance Document at any time without assigning any reason therefor by
giving not less than thirty days' prior written notice to that effect to
each of the other parties hereto Provided that no such resignation shall
be effective until a successor for the Agent or, as the case may be, the
Trustee is appointed in accordance with the succeeding provisions of
this Clause 23 or the Security Trust Deed.
23.10 Successor Agent
If the Agent or, as the case may be, the Trustee gives notice of its
resignation pursuant to Clause 23.9 (Resignation), then any Bank whose
participation in the Facility is at least ten per cent. (10%) may be
appointed by an Instructing Group with the Borrower's prior written
consent (such consent not to be unreasonably delayed or withheld) as a
successor to the Agent or, as the case may be, the Trustee by an
Instructing Group during the period of such notice but, if no such
successor is so appointed, the Agent or, as the case may be, the Trustee
may appoint such a successor itself.
23.11 Rights and Obligations
If a successor to the Agent or, as the case may be, the Trustee is
appointed under the provisions of Clause 23.10 (Successor Agent), then
(a) the retiring Agent or, as the case may be, the Trustee shall be
discharged from any further obligation under any of the Finance
Documents but shall remain entitled to the benefit of the provisions of
this Clause 23 and (b) its successor and each of the other parties
hereto shall have the same rights and obligations amongst themselves as
they would have had if such successor had been a party hereto.
23.12 Own Responsibility
It is understood and agreed by each Bank that it has itself been, and
will continue to be, solely responsible for making its own independent
appraisal of and investigations into the financial condition,
creditworthiness, condition, affairs, status and nature of each member
of the Parent's Group and, accordingly, each Bank warrants to the Agent,
the Trustee and the Arrangers that it has not relied on and will not
hereafter rely on the Agent, the Trustee and the Arrangers or any of
them:
(i) to check or enquire on its behalf into the adequacy, accuracy
or completeness of any information provided by any Finance
Party in connection with the Finance Documents or the
transactions contemplated thereby (whether or not such
information has been or is hereafter circulated to such Bank
by the Agent, the Trustee and the Arrangers or any of them);
or
(ii) to assess or keep under review on its behalf the financial
condition, creditworthiness, condition, affairs, status or
nature of any member of the Parent's Group.
23.13 Agency Division Separate
In acting as Agent or, as the case may be, the Trustee hereunder for the
Banks, the Agent or, as the case may be, the Trustee shall be regarded
as acting through its agency division which shall be treated as a
separate entity from any other of its divisions or departments and,
notwithstanding the foregoing provisions of this Clause 23, any
information received by some other division or department of the Agent
or, as the case may be, the Trustee may be treated as confidential and
shall not be regarded as having been given to the Agent's or the
Trustee's agency division.
23.14 Confidential Information
Notwithstanding anything to the contrary expressed or implied herein and
without prejudice to the provisions of Clause 23.13 (Agency Division
Separate), neither the Agent nor the Trustee shall as between itself and
the Banks be bound to disclose to any Bank or other person any
information which is supplied by any member of the Parent's Group to the
Agent in its capacity as agent or trustee hereunder for the Banks and
which is identified by such member of the Parent's Group at the time it
is so supplied as being confidential information.
Part 11
ASSIGNMENTS AND TRANSFERS
24. Assignments and Transfers
24.1 Binding Agreement
This Agreement shall be binding upon and enure to the benefit of each
party hereto and its or any subsequent successors, Transferees and
permitted assigns.
24.2 No Assignments and Transfers by the Borrower
The Borrower shall not be entitled to assign or transfer all or any of
its rights, benefits and obligations hereunder.
24.3 Assignments and Transfers by Banks
Any Bank may at any time (and at its own cost) assign to any bank or
financial institution all or any of its rights and benefits hereunder or
transfer to any bank or financial institution in accordance with Clause
24.5 (Transfers by Banks) all or any of its rights, benefits and
obligations hereunder Provided that:
(i) (save in the case of an assignment or transfer to any
subsidiary or holding company, or to any subsidiary of any
holding company, of such Bank or to another Bank) no such
assignment or transfer may be made without the prior written
approval of the Borrower, such approval not to be unreasonably
withheld or delayed;
(ii) no Bank shall be entitled to effect any such assignment or
transfer (otherwise than with the prior written approval of
the Borrower) if as a result thereof (and as at the date
thereof) the Borrower would be obliged to make a payment to
the assignee or transferee which it would not have been
obliged to make to such Bank or which is greater than the
payment it would have been obliged to make to the assignor or
transferor;
(iii) no Bank party hereto as at the Original Facility Date shall be
entitled to assign or transfer any of its rights and benefits
hereunder to more than one other bank or financial
institution; and
(iv) a Bank may only assign or transfer the same proportion of its A Commitment
and B Commitment.
24.4 Assignments by Banks
If any Bank assigns all or any of its rights and benefits hereunder in
accordance with Clause 24.3 (Assignments and Transfers by Banks), then,
unless and until the assignee has agreed with the Agent, the Trustee,
the Arrangers and the other Banks that it shall be under the same
obligations towards each of them as it would have been under if it had
been an original party hereto as a Bank (whereupon such assignee shall
become a party hereto as a "Bank"), the Agent, the Trustee, the
Arrangers and the other Banks shall not be obliged to recognise such
assignee as having the rights against each of them which it would have
had if it had been such a party hereto.
24.5 Transfers by Banks
If any Bank wishes to transfer all or any of its rights, benefits and/or
obligations hereunder as contemplated in Clause 24.3 (Assignments and
Transfers by Banks), then such transfer may be effected by the delivery
to the Agent and the Borrower of a duly completed and duly executed
Transfer Certificate in which event, on the later of the Transfer Date
specified in such Transfer Certificate and the fifth business day after
(or such earlier business day endorsed by the Agent on such Transfer
Certificate falling on or after) the date of delivery of such Transfer
Certificate to the Agent:
(i) to the extent that in such Transfer Certificate the Bank party
thereto seeks to transfer its rights, benefits and obligations
hereunder, the Borrower and such Bank shall be released from
further obligations towards one another hereunder and their
respective rights against one another shall be cancelled (such
rights and obligations being referred to in this Clause 24.5
as "discharged rights and obligations");
(ii) the Borrower and the Transferee party thereto shall assume
obligations towards one another and/or acquire rights against
one another which differ from such discharged rights and
obligations only in so far as the Borrower and such Transferee
have assumed and/or acquired the same in place of the Borrower
and such Bank;
(iii) the Agent, the Trustee the Arrangers, such Transferee and the
other Banks shall acquire the same rights and benefits and
assume the same obligations between themselves as they would
have acquired and assumed had such Transferee been an original
party hereto as a Bank with the rights, benefits and/or
obligations acquired or assumed by it as a result of such
transfer; and
(iv) such Transferee shall become a party hereto as a "Bank".
24.6 Transfer Fees
On the date upon which a transfer takes effect pursuant to Clause 24.5
(Transfers by Banks) the Transferee in respect of such transfer shall
pay to the Agent for its own account a transfer fee of $1,000.
24.7 Disclosure of Information
Any Bank may disclose with the prior written consent of the Finance
Parties (such consent in either case not to be unreasonably withheld) to
any actual or potential assignee or Transferee or to any person who may
otherwise enter into contractual relations with such Bank in relation to
this Agreement such information about the Parent, the Borrower and the
Parent's Group as such Bank shall consider appropriate Provided That the
Borrower may require such Bank to obtain from such actual or potential
assignee, Transferee, or such other person, a confidentiality
undertaking (in a form reasonably acceptable to both the Borrower and
such Bank) in relation to such information about the Parent, the
Borrower and/or the Parent's Group as has been supplied to the Banks on
a confidential basis.
Part 12
MISCELLANEOUS
25. Calculations and Evidence of Debt
25.1 Basis of Accrual
Interest and commitment commission shall accrue from day to day and
shall be calculated on the basis of a year of 360 days and the actual
number of days elapsed.
25.2 Quotations
If on any occasion a Reference Bank or a Bank fails to supply the Agent
with a quotation required of it under the foregoing provisions of this
Agreement, the rate for which such quotation was required shall be
determined from those quotations which are supplied to the Agent.
25.3 Evidence of Debt
Each Bank shall maintain in accordance with its usual practice accounts
evidencing the amounts from time to time lent by and owing to it
hereunder.
25.4 Control Accounts
The Agent shall maintain on its books a control account or accounts in
which shall be recorded (a) the amount of any Advance made or arising
hereunder and each Bank's share therein, (b) the amount of all
principal, interest and other sums due or to become due from the
Borrower hereunder and each Bank's share therein and (c) the amount of
any sum received or recovered by the Agent hereunder and each Bank's
share therein.
25.5 Prima Facie Evidence
In any legal action or proceeding arising out of or in connection with
this Agreement, the entries made in the accounts maintained pursuant to
Clause 25.3 (Evidence of Debt) and Clause 25.4 (Control Accounts) shall
be prima facie evidence of the existence and amounts of the specified
obligations of the Borrower.
25.6 Certificates of Banks
A certificate of a Bank as to (a) the amount by which a sum payable to
it hereunder is to be increased under Clause 8.1 (Tax Gross-up) or (b)
the amount for the time being required to indemnify it against any such
cost, payment or liability as is mentioned in Clause 8.2 (Tax Indemnity)
or Clause 10.1 (Increased Costs) shall, in the absence of manifest
error, be prima facie evidence of the existence and amounts of the
specified obligations of the Borrower.
26. Remedies and Waivers, Partial Invalidity
26.1 Remedies and Waivers
No failure to exercise, nor any delay in exercising, on the part of the
Agent, the Trustee, the Arrangers and the Banks or any of them, any
right or remedy under any of the Finance Documents shall operate as a
waiver thereof, nor shall any single or partial exercise of any right or
remedy prevent any further or other exercise thereof or the exercise of
any other right or remedy. The rights and remedies herein provided are
cumulative and not exclusive of any rights or remedies provided by law.
26.2 Partial Invalidity
If, at any time, any provision hereof is or becomes illegal, invalid or
unenforceable in any respect under the law of any jurisdiction, neither
the legality, validity or enforceability of the remaining provisions
hereof nor the legality, validity or enforceability of such provision
under the law of any other jurisdiction shall in any way be affected or
impaired thereby.
27. Notices
27.1 Communications in Writing
Each communication to be made hereunder shall be made in writing but,
unless otherwise stated, shall be made by facsimile or letter.
27.2 Delivery
Any communication or document to be made or delivered by one party to
the other pursuant to this Agreement shall (unless the other party has
by fifteen days' written notice to the one specified another address or
facsimile number) be made or delivered to that other party at the
address or facsimile number identified with its signature below and
shall be deemed to have been made or delivered (in the case of any
communication made by facsimile) when despatched and the transmission
report of the sender indicates that the facsimile transmission has been
received by the addressee or (in the case of any communication made by
letter) when delivered to that address or (as the case may be) ten days
after being deposited in the post postage prepaid in an envelope
addressed to it at that address Provided that:
(i) if any such communication or document would otherwise be
deemed to have been received on a day which is not a business
day it shall be deemed to have been received on the first
business day thereafter;
(ii) any communication or document to be made or delivered by the
Borrower to a Bank shall be effective only when legibly
received by such Bank and then only if the same is expressly
marked for the attention of the department or officer
identified with such Bank's signature below or as set out in
the relevant Transfer Certificate (or such other department or
officer as such Bank shall from time to time specify for this
purpose);
(iii) if any facsimile transmission has not been legibly received,
the addressee shall as soon as reasonably practicable notify
the giver by telephone and in such circumstances,
notwithstanding any of the foregoing provisions, such
facsimile communication shall not be deemed to be received
until it has been re-transmitted and legibly received; and
(iv) any communication or document to be made or delivered to the Borrower shall
be copied also to:
Bona Shipping AS
▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇.▇. ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
Attn: Finance and Control Department
Fax: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Tel: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
and to:-
Teekay Shipping (Canada) Ltd.
▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Attn: Manager of Finance
Fax : ▇▇▇ ▇▇▇ ▇▇▇▇
Tel : ▇▇▇ ▇▇▇ ▇▇▇▇
27.3 English Language
Each communication and document made or delivered by one party to
another pursuant to this Agreement shall be in the English language or
accompanied by a translation thereof into English certified (by an
officer of the person making or delivering the same) as being a true and
accurate translation thereof and in the event of a conflict between the
original and the English translation thereof, the translation will be
taken to be the definitive version for the purposes of the Finance
Documents.
28. Amendments
28.1 Amendments
If the Agent has the prior consent of an Instructing Group, the Agent,
the Parent and the Borrower may from time to time agree in writing to
amend this Agreement or to waive, prospectively or retrospectively, any
of the requirements of this Agreement and any amendments or waivers so
agreed shall be binding on all parties hereto, provided that no such
waiver or amendment shall subject any party hereto to any new or
additional obligations without the consent of such party.
28.2 Amendments Requiring the Consent of all the Banks
An amendment or waiver which relates to:-
(i) Clause 20 (Sharing) or this Clause 28 (Amendments);
(ii) a change in the principal amount of any Advance, or the
deferral of any Repayment Date or Reduction Date;
(iii) a change in Margin 1 or Margin 2 or the amount of any payment
of interest, fees or any other amount payable hereunder to any
party or the deferral of the date for payment thereof;
(iv) the definition of "Instructing Group"; or
(v) any provision which contemplates the need for the consent or approval
of all the Banks,
shall not be made without the prior consent of all the Banks.
28.3 Exceptions
Notwithstanding any other provisions hereof, the Agent shall not be
obliged to agree to any such amendment or waiver if the same would:
(i) amend or waive this Clause 28.3, Clause 22 (Costs and Expenses) or
Clause 23 (The Agent, the Arrangers and the Banks); or
(ii) otherwise amend or waive any of the Agent's rights hereunder
or subject the Agent or the Arrangers to any additional
obligations hereunder.
Part 13
LAW AND JURISDICTION
29. Law
29.1 English Law
This Agreement shall be governed by, and shall be construed in
accordance with, English law.
30. Jurisdiction
30.1 Each of the parties hereto irrevocably agrees for the benefit of the
Agent, the Trustee and the Banks that the courts of England shall have
jurisdiction to hear and determine any suit, action or proceeding, and
to settle any disputes, which may arise out of or in connection with
this Agreement and, for such purposes, irrevocably submits to the
jurisdiction of such courts.
30.2 The Borrower irrevocably waives any objection which it might now or
hereafter have to the courts referred to in Clause 30.1 being nominated
as the forum to hear and determine any suit, action or proceeding, and
to settle any disputes, which may arise out of or in connection with
this Agreement and agrees not to claim that any such court is not a
convenient or appropriate forum.
30.3 The Borrower agrees that the process by which any suit, action or
proceeding in England is begun may be served on it by being delivered to
Teekay Shipping (UK) Limited at its registered office for the time being
(which is currently at ▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇).
30.4 The submission to the jurisdiction of the courts referred to in Clause
30.1 shall not (and shall not be construed so as to) limit the right of
the Agent, the Trustee or any Bank to take proceedings against the
Borrower in any other court of competent jurisdiction nor shall the
taking of proceedings in any one or more jurisdictions preclude the
taking of proceedings in any other jurisdiction, whether concurrently or
not.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first before written.
THE FIRST SCHEDULE
The Banks
==================================================================================================================
A B Total
Bank Commitment Commitment Commitment
($) ($) ($)
==================================================================================================================
Citibank, N.A. 48,000,000 12,000,000 60,000,000
The Chase Manhattan Bank 48,000,000 12,000,000 60,000,000
The Royal Bank of Scotland plc 40,000,000 10,000,000 50,000,000
Christiana Bank og Kreditkasse ASA 34,000,000 8,500,000 42,500,000
Den norske Bank 34,000,000 8,500,000 42,500,000
Credit Agricole Indosuez 28,000,000 7,000,000 35,000,000
KBC Finance Ireland 28,000,000 7,000,000 35,000,000
MeesPierson N.V. 28,000,000 7,000,000 35,000,000
Schiffshypothekenbank zu Lubeck AG 26,000,000 6,500,000 32,500,000
BankBoston, N.A. 20,000,000 5,000,000 25,000,000
Landesbank Schleswig-Holstein Girozentrale 20,000,000 5,000,000 25,000,000
▇▇▇▇▇▇ Bank plc
Deutsche Bank (Hamburg) 14,400,000 3,600,000 18,000,000
Deutsche Schiffsbank AG 14,000,000 3,500,000 17,500,000
VIKING Ship Finance Limited 9,600,000 2,400,000 12,000,000
8,000,000 2,000,000 10,000,000
--------------
500,000,000
==================================================================================================================
THE SECOND SCHEDULE
Form of Transfer Certificate
To: Citibank International plc
TRANSFER CERTIFICATE
relating to the agreement (as from time to time amended, varied, novated or
supplemented, the "Facility Agreement") dated 16th December 1998 as amended and
restated on ___________ 1999 whereby a U.S.$500,000,000 revolving credit
facility was made available to Bona Shipholding Ltd. as borrower by a group of
banks on whose behalf Citibank International plc acted as agent in connection
therewith.
1. Terms defined in the Facility Agreement shall, subject to any contrary
indication, have the same meanings herein. The terms Bank and Transferee
are defined in the schedule hereto.
2. The Bank (i) confirms that the details in the schedule hereto under
the heading "Total Bank's Commitment" or "Advance(s)" accurately
summarises its Total Commitment and/or, as the case may be, its
participation in, and the Term and Repayment Date of, one or more
existing Advances and (ii) requests the Transferee to accept and
procure the transfer to the Transferee of the portion specified in the
schedule hereto of, as the case may be, its Total Commitment and/or
its participation in such Advance(s) by counter-signing and delivering
this Transfer Certificate to the Agent at its address for the service
of notices specified in the Facility Agreement.
3. The Transferee hereby requests the Agent to accept this Transfer
Certificate as being delivered to the Agent pursuant to and for the
purposes of Clause 24.5 (Transfers by Banks) of the Facility Agreement
so as to take effect in accordance with the terms thereof on the
Transfer Date or on such later date as may be determined in accordance
with the terms thereof.
4. The Transferee confirms that it has received a copy of the Finance
Documents together with such other information as it has required in
connection with this transaction and that it has not relied and will not
hereafter rely on the Bank to check or enquire on its behalf into the
legality, validity, effectiveness, adequacy, accuracy or completeness of
any such information and further agrees that it has not relied and will
not rely on the Bank to assess or keep under review on its behalf the
financial condition, creditworthiness, condition, affairs, status or
nature of the Borrower.
5. The Transferee hereby undertakes with the Bank and each of the other
parties to the Facility Agreement that it will perform in accordance
with their terms all those obligations which by the terms of the
Facility Agreement will be assumed by it after delivery of this Transfer
Certificate to the Agent and satisfaction of the conditions (if any)
subject to which this Transfer Certificate is expressed to take effect.
6. The Bank makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Facility Agreement or any document
relating thereto and assumes no responsibility for the financial
condition of the Borrower or for the performance and observance by the
Borrower of any of its obligations under the Facility Agreement or any
document relating thereto and any and all such conditions and
warranties, whether express or implied by law or otherwise, are hereby
excluded.
7. The Bank hereby gives notice that nothing herein or in the Facility
Agreement (or any document relating thereto) shall oblige the Bank to
(a) accept a re-transfer from the Transferee of the whole or any part
of its rights, benefits and/or obligations under the Facility
Agreement transferred pursuant hereto or (b) support any losses
directly or indirectly sustained or incurred by the Transferee for any
reason whatsoever including the non-performance by the Borrower or any
other party to the Facility Agreement (or any document relating
thereto) of its obligations under any such document. The Transferee
hereby acknowledges the absence of any such obligation as is referred
to in (a) or (b) above.
8. This Transfer Certificate and the rights, benefits and obligations of
the parties hereunder shall be governed by and construed in accordance
with English law.
THE SCHEDULE
1. Bank:
2. Transferee:
3. Transfer Date:
4. Total Commitment:
Bank's A Commitment Portion Transferred
Bank's B Commitment Portion Transferred
5. Advance(s):
Amount of Term and
Bank's Participation Repayment Date Portion Transferred
[Transferor Bank] [Transferee Bank]
By: By:
Date: Date:
Administrative Details of Transferee
Address:
Contact Name:
Account for Payments:
Fax:
Telephone:
THE THIRD SCHEDULE
Part 1
Condition Precedent Documents for the first Advance hereunder
1. A copy, certified a true copy by a duly authorised officer of the
Borrower, of the Borrower's constitutive documents.
2. A copy, certified a true copy by a duly authorised officer of the
Borrower, of a resolution of the Borrower's Board of Directors approving
the execution, delivery and performance of the Finance Documents and the
terms and conditions of the Finance Documents and authorising a named
person or persons to sign this Agreement and any documents to be
delivered by the Borrower pursuant hereto or pursuant to any of the
other Finance Documents.
3. A certificate of a duly authorised officer of the Borrower setting out
the names and signatures of the persons authorised to sign, on behalf of
the Borrower, this Agreement and the other Finance Documents and any
documents to be delivered by the Borrower pursuant hereto or thereto.
4. A copy, certified a true copy by a duly authorised officer of the
Borrower, of the powers of attorney, if any, issued pursuant to the
resolution referred to in paragraph 2 above.
5. A copy, certified a true copy by or on behalf of the Borrower, of each
such law, decree, consent, licence, approval, registration or
declaration as is, in the opinion of counsel to the Agent, necessary to
render the Finance Documents legal, valid, binding and enforceable, to
make this Agreement admissible in evidence in Bermuda.
6. An opinion of the Agent's counsel in Bermuda, Messrs ▇▇▇▇▇▇▇, ▇▇▇▇ &
▇▇▇▇▇▇▇ in form and substance satisfactory to the Agent.
7. An opinion of the Agent's English counsel, Messrs. ▇▇▇▇▇▇▇▇ Chance, in
form and substance satisfactory to the Agent.
8. Evidence that ▇▇▇▇▇▇▇▇ Services Limited has agreed to act as the agent
of the Borrower for the service of process in England.
9. A copy, certified a true copy by a director of the Borrower, of the
Original Consolidated Financial Statements.
10. A certificate as at the most recent Quarter Date prior to the Original
Facility Date showing the Borrower's level of Free Cash, Current Ratio
and Leverage at such date.
11. A security trust deed in the form or substantially the form of that
attached hereto as Exhibit A.
12. Evidence that the Borrower has, on or before the date of the first
Advance hereunder, (i) cancelled the whole of the Aggregate Total
Commitments (as defined in the Newbuilding Facility) and the whole of
the Total Commitments (as defined in the Citibank Revolver and the Chase
Revolver) and (ii) given notice of its intention to prepay all amounts
outstanding (as at the date of the of the first Advance hereunder) under
the Citibank Revolver and the Chase Revolver
13. Notice from the Borrower cancelling the whole of the Aggregate Total
Commitments as defined in the Newbuilding Facility and the whole of the
Total Commitments as defined in the Citibank Revolver and the Chase
Revolver.
14. Evidence in form and substance satisfactory to the Agent that each
Initial Vessel is insured in accordance with the requirements of the
relevant Security Agreements.
15. Evidence in form and substance satisfactory to the Agent that each
Initial Vessel is classified with a classification society in accordance
with the requirements of the relevant Security Agreements.
16. An opinion of the counsel to the Agent in the countries in which the
Initial Vessels are registered in form and substance satisfactory to the
Agent.
17. Evidence that there are no other existing mortgages or other
encumbrances (other than permitted liens and other than encumbrances
created to secure the Borrower's obligations under the Citibank Revolver
or the Chase Revolver) over the Initial Vessels or their earnings and
insurances.
18. A Mortgage over each Initial Vessel duly executed and delivered by the
Borrower and registered against each such Initial Vessel in its
appropriate registry.
19. Deeds of Assignment duly executed and delivered by the Borrower in
respect of the earnings and insurances of each Initial Vessel (the said
assignment of earnings to provide that the Trustee shall not be entitled
to require the assigned earnings to be paid to the Trustee thereunder
unless and until an Event of Default has occurred and is continuing).
20. All notices required to be given by the terms of the Deeds of Assignment
referred to in paragraph 19 above.
21. Evidence that all outstandings under the Citibank Revolver and the Chase
Revolver will be met from the proceeds of the first drawdown hereunder.
22. Evidence that all security granted pursuant to the Chase Revolver and
the Citibank Revolver over the Initial Vessels, their insurances or
earnings, shall have been discharged concurrently with the making of the
first Advance hereunder.
23. Confirmation from ▇▇▇▇▇▇▇▇ Chance as to the status of items referred to
in paragraphs 1 to 22 above, included.
Part 2
1. A copy, certified a true copy by a duly authorised officer of the
Borrower, of the Borrower's constitutive documents or, where such
documents have not changed since being provided pursuant to paragraph 1
of Part 1 of the Third Schedule, a certificate of a duly authorised
officer of the Borrower to that effect.
2. A copy, certified a true copy by a duly authorised officer of the
Borrower, of a resolution of the Borrower's Board of Directors approving
the execution, delivery and performance of the additional Finance
Documents and the terms and conditions of the additional Finance
Documents and authorising a named person or persons to sign any
documents to be delivered by the Borrower pursuant to such additional
Finance Documents.
3. A certificate of a duly authorised officer of the Borrower setting out
the names and signatures of the persons authorised to sign, on behalf of
the Borrower, the additional Finance Documents and any documents to be
delivered by the Borrower pursuant thereto.
4. A copy, certified a true copy by a duly authorised officer of the
Borrower, of the powers of attorney, if any, issued pursuant to the
resolution referred to in paragraph 2 above.
5. A copy, certified a true copy by or on behalf of the Borrower, of each
such law, decree, consent, licence, approval, registration or
declaration as is, in the opinion of counsel to the Agent, necessary to
render the additional Finance Documents legal, valid, binding and
enforceable, to make them admissible in evidence in Bermuda and to
enable the Borrower lawfully to perform its respective obligations
thereunder.
6. Evidence in form and substance satisfactory to the Agent that the
relevant New Vessel or Future Vessel, as the case may be, is insured in
accordance with the requirements of the relevant Security Agreements.
7. Evidence in form and substance satisfactory to the Agent that the
relevant New Vessel or Future Vessel (as the case may be) is classified
with a classification society in accordance with the requirements of the
relevant Security Agreements.
8. An opinion of the counsel to the Agent in the country in which the New
Vessel or Future Vessel, as the case may be, in respect of which the
relevant Advance is made is to be registered in form and substance
satisfactory to the Agent.
9. Evidence that there are no other existing mortgages or other
encumbrances (other than permitted liens) over the relevant New Vessel
or Future Vessel, as the case may be, or its earnings and insurances.
10. A Mortgage over the relevant New Vessel or Future Vessel (as the case
may be) duly executed and delivered by the Borrower and registered
against such New Vessel or Future Vessel, as the case may be, in its
appropriate registry.
11. A Deed of Assignment duly executed and delivered by the Borrower in
respect of the earnings and insurances of the relevant New Vessel or
Future Vessel, as the case may be, (the said assignment of earnings to
provide that the Trustee shall not be entitled to require the assigned
earnings to be paid to the Trustee thereunder unless and until an Event
of Default has occurred as is continuing).
12. All notices required to be given by the terms of the Deed of Assignment
referred to in paragraph 11 above.
THE FOURTH SCHEDULE
Notice of Drawdown
From: Bona Shipholding Ltd.
To: Citibank International plc
Dated:
Dear Sirs,
1. We refer to the agreement (as from time to time amended, varied, novated
or supplemented, the "Facility Agreement") dated 16th December 1998 as
amended and restated on __________ 1999 and made between Bona
Shipholding Ltd. as borrower, Chase Manhattan plc and Citibank
International plc as arrangers, Citibank International Plc as agent and
trustee and the financial institutions named therein as Banks. Terms
defined in the Facility Agreement shall have the same meaning in this
notice.
2. We hereby give you notice that, pursuant to the Facility Agreement and
upon the terms and subject to the conditions contained therein, we wish
an Advance to be made to us as follows:
(a) Amount:
(b) Facility: [insert Facility A, Facility B as appropriate]
(c) Drawdown Date:
(d) Term:
3. We confirm that, at the date hereof, the representations set out in
Clause 11 (Representations) of the Facility Agreement are true and no
Event of Default or Potential Event of Default has occurred.
4. The proceeds of this drawdown should be credited to [insert account details].
Yours faithfully
.............................
for and on behalf of
The Borrower
BONA SHIPHOLDING LTD.
By: ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
Address: ▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇
Attn: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇ ▇▇▇▇
Arranger
CHASE MANHATTAN plc
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: ▇▇▇▇ ▇▇▇ ▇▇▇▇
Arranger, Agent and Trustee
CITIBANK INTERNATIONAL plc
By: ▇▇▇▇ ▇▇▇▇▇▇
Address: ▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Fax: ▇▇▇▇ ▇▇▇ ▇▇▇▇
The Banks
CITIBANK, N.A.
By: ▇▇▇▇▇ ▇▇▇▇▇
Address: ▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇ - Global Shipping
Fax: + 44 171 500 2762
THE CHASE MANHATTAN BANK
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attn:Credit matters: ▇▇▇▇▇ ▇▇▇▇▇▇▇; Operational matters: European Loan Services
Fax: Credit matters: + 47 22 42 5861; Operational matters: + 44 1202 343 706
THE ROYAL BANK OF SCOTLAND PLC
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: Shipping Business Centre
▇.▇. ▇▇▇ ▇▇▇
▇-▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attn: Graham Locker (Credit matters); ▇▇▇▇▇▇▇ ▇▇▇▇ (Operational matters)
Fax: + ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
CHRISTIANIA BANK OG KREDITKASSE ASA
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
Address: ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
Attn:▇▇▇▇ ▇▇▇▇▇▇▇ - Shipping Dept (Credit matters); Aud Sandnes (Operational
matters)
Fax: + ▇▇ ▇▇ ▇▇ ▇▇ ▇▇ (Credit matters); + 47 22 48 50 79 (Operational matters)
DEN NORSKE BANK ASA
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Address: ▇▇▇▇▇▇▇▇ ▇▇
▇-▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
Attn:
Fax: + 47 22 48 88 94
CREDIT AGRICOLE INDOSUEZ
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: ▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ La Defense Cedex
France
Attn: Pierre de Fontenay (Credit matters);
▇▇▇▇▇▇▇▇ ▇▇▇▇ (Operational matters)
Fax: + 33 1 41 89 19 34 (Credit matters);
+ 33 1 41 89 20 79 (Operational matters)
KBC FINANCE IRELAND
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: KBC House
International Financial Services Centre
Dublin 1
Ireland
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax: + 353 1 670 0855
MEESPIERSON N.V.
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇
▇-▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇
Attn: Diederik Legger
Fax: + 47 22 11 49 40
SCHIFFSHYPOTHEKENBANK ZU LUBECK AG
By: TORE ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Address: ▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Fax: + 49 40 3701 4649
BANKBOSTON, N.A.
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇
Attn: Credit matters: ▇▇▇▇ ▇▇▇▇▇▇▇▇; Operational matters: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: Credit matters: + 1 617 434 1955; Operational matters: + 1 617 434 9820
LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE
By: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Address: Martensdamm 6
D-24 103 Kiel
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: + 49 431 900 1130
▇▇▇▇▇▇ BANK PLC, LONDON BRANCH
By: ▇▇▇▇▇ ▇'▇▇▇▇▇
Address: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: ▇▇▇▇ ▇▇▇ ▇▇▇▇
DEUTSCHE BANK AG IN HAMBURG
By: TORE ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ TRENNT
Address: ▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Ship Financing Dept.
Fax: + 49 40 3701 4649
DEUTSCHE SCHIFFSBANK AG
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: Domshof 17
D-28195 Bremen
Germany
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Fax: + 49 421 323 539
VIKING SHIP FINANCE LTD
By: ▇▇▇▇ ▇▇▇▇▇▇ (Attorney)
Address: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇-▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Fax: + 41 1 234 4066