Exhibit 4.22
Private & Confidential
Dated 15 March 2006
KOMARF HOPE 30 SHIPPING COMPANY
as Owner (1)
VITSI SHIPPING CO. LTD.
as Charterer (2)
TOP TANKERS INC.
as Charter Guarantor (3)
and
FORTIS BANK (NEDERLAND) N.V. (4)
QUADRIPARTITE DEED relating to m.v.
"Stopless"
▇▇▇▇▇▇ ▇▇▇▇
Contents
Clause Page
1 Definitions ......................................................2
2 Representations and warranties....................................9
3 Assignment.......................................................12
4 Owner's Assignment...............................................13
5 Continuing security and other matters............................14
6 Charterer's undertakings.........................................16
7 General Undertakings.............................................18
8 Covenants concerning insurance and operational matters ..........18
9 Powers of Mortgagee to protect security and remedy defaults .....30
10 Powers of Mortgagee on Event of Default..........................30
11 Application of moneys............................................31
12 Remedies cumulative and other provisions.........................32
13 Costs and indemnity..............................................32
14 Attorney.........................................................33
15 Further assurance................................................33
16 Sale of Ship.....................................................33
17 Continuation of Charter Period...................................35
18 Notices..........................................................35
19 Counterparts.....................................................36
20 Severability of provisions.......................................36
21 Law and jurisdiction ...........................................36
Schedule 1 Forms of Loss Payable Clauses.................................38
Schedule 2 Forms of Notices of Assignment of Insurances..................39
THIS QUADRIPARTITE DEED is dated 15 March 2006
BETWEEN:
(1) KOMARF HOPE 30 SHIPPING COMPANY a company incorporated under the laws of
the Republic of Liberia whose registered office is at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ of Liberia (the "Owner");
(2) VITSI SHIPPING CO. LTD., a company incorporated in the Republic of
Liberia whose registered office is at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ of Liberia (the "Charterer");
(3) TOP TANKERS INC., a company incorporated in the ▇▇▇▇▇▇▇▇ Islands whose
registered office is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, ▇▇▇▇▇▇▇▇ Islands MH96960 (the "Charter Guarantor"); and
(4) FORTIS BANK (NEDERLAND) N.V., a company incorporated under the laws of
The Netherlands acting for the purposes of this Deed through its office
at ▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇ Rotterdam, The Netherlands (the "Mortgagee").
WHEREAS:
(A) the Owner is the sole, absolute and unencumbered, legal and beneficial
owner of sixty-four sixty-fourth shares in the Ship described in clause
1.2;
(B) by a loan and guarantee facility agreement (the "Loan and Guarantee
Facility Agreement") dated 9 March 2006 and made between (1) the Owner
(therein referred to as the "Borrower"), (2) the banks and financial
institutions whose names are set out at Schedule 1 thereto as lenders
(the "Banks"), (3) the Mortgagee as agent, security agent and trustee
(the "Agent"), (4) Fortis Bank (Nederland) N.V. as guarantee bank (the
"Guarantee Bank "), (5) Fortis Bank (Nederland) N.V. as arranger (the
"Arranger) and (6) Fortis Bank (Nederland) N.V. as swap provider (the
"Swap Provider" and together with the Agent, the Arranger and the
Account Bank (as defined in the Loan and Guarantee Facility Agreement),
the Guarantee Bank and the Banks, the "Creditors"), the Banks agreed
(inter alia) to advance by way of loan to the Owner, upon the terms and
conditions therein, a maximum aggregate amount of up to thirty three
million and six hundred thousand Dollars ($33,600,000) and the Guarantee
Bank agreed to issue and/or maintain the Guarantee (as defined in the
Loan and Guarantee Facility Agreement (the "Guarantee") in favour of the
Beneficiary (as defined in the Loan and Guarantee Facility Agreement);
(C) by a 1992 ISDA Master Agreement dated 9 March 2006 (the "Master Swap
Agreement") made between (1) the Owner and (2) the Swap Provider, the
Swap Provider agreed the terms and conditions upon which it would enter
into (inter alia) interest rate swap transactions with the Owner in
respect of the Loan (whether in whole or in part as the case may be from
time to time);
(D) pursuant to clause 16.1 of the Loan and Guarantee Facility Agreement,
each of the Creditors has appointed the Mortgagee as its agent, security
agent and trustee and pursuant to a deed of trust dated 9 March 2006
executed by the Mortgagee (as trustee) in favour of the Creditors, the
Mortgagee agreed to hold, receive, administer and enforce this Deed for
and on behalf of itself and the Creditors;
(E) pursuant to the Loan and Guarantee Facility Agreement and the Master
Swap Agreement there has been or will be executed by the Owner in favour
of the Mortgagee (as security agent and trustee for and on behalf of the
Creditors) a first preferred ship mortgage (the "Mortgage") on the Ship
and the Mortgage of even date herewith has been or will be registered
under the provisions of Chapter 3 of title 21 of the Liberian Code of
Laws of 1956 as amended as security for the payment by the Owner of the
Outstanding Indebtedness (as those expressions are defined in the
Mortgage);
(F) by a "Barecon 2001" bareboat charter (the "Charter") dated 9 March 2006
made between the Owner and the Charterer, the Owner has agreed to let
and the Charterer has agreed to take the Ship on demise charter for a
period of sixty (60) months from the date of delivery of the Ship to the
Charterer thereunder upon the terms and conditions therein mentioned;
(G) as security for the obligations of the Charterer under the Charter, the
Charter Guarantor has or, as the case may be, will execute a guarantee
in favour of the Owner (the "Charter Guarantee");
(H) the Loan and Guarantee Facility Agreement provided (inter alia) that as
a condition precedent to the advance of the Loan the Owner, the
Charterer and the Charter Guarantor should enter into a deed
supplemental to the Mortgage substantially in the form of this Deed, to
secure (inter alia) all sums of money from time to time owing to the
Mortgagee and/or the Creditors under the Loan and Guarantee Facility
Agreement, the Master Swap Agreement and the other Security Documents;
and
(I) this Deed is supplemental to the Loan and Guarantee Facility Agreement
and the Mortgage and to the security thereby created and is the
Quadripartite Deed referred to in the Loan and Guarantee Facility
Agreement but shall nonetheless continue in full force and effect
notwithstanding any discharge of the Mortgage.
NOW THIS DEED WITNESSES AND IT IS HEREBY AGREED as follows:
1 Definitions
1.1 Definitions
In this Deed, unless the context otherwise requires:
"Approved Brokers" means such firm of insurance brokers, appointed by
the Charterer during the Charter Period, as may from time to time be
approved in writing by the Mortgagee for the purposes of this Deed;
"Casualty Amount" means five hundred thousand Dollars ($500,000) (or the
equivalent in any other currency);
"Charter" means the "Barecon 2001" demise charter entered or (as the
context may require) to be entered into by the Owner and the Charterer
referred to in recital (F);
"Charterer" includes the successors in title and permitted assignees of
the Charterer; "Charterer's Assigned Property" means all of the
Charterer's rights, title and interest in and to:
(a) the Insurances; and
(b) any Requisition Compensation;
"Charter Earnings" means all moneys whatsoever from time to time payable
by the Charterer to the Owner under or pursuant to the Charter and/or
any moneys payable to the Owner under or pursuant to the Charter
Guarantee and/or any guarantee, security or other assurance given to the
Owner at any time in respect of the Charterer's obligations under or
pursuant to the Charter;
"Charter Guarantee" means the guarantee executed or (as the context may
require) to be executed by the Charter Guarantor in favour of the Owner
pursuant to the Charterer;
"Charter Guarantor" includes the successors in title and permitted
assignees of the Charter Guarantor;
"Charter Guarantor's Account" means the interest bearing Dollar account
of the Charter Guarantor opened or (as the context may require) to be
opened with the Mortgagee (acting as Account Bank) with account number
024075615017407192 and includes any sub-accounts thereof and any other
account designated in writing by the Mortgagee to be the Charter
Guarantor's Account for the purposes of this Deed;
"Charter Period" means such part of the period of the Charter as falls
within the Security Period or, in the event of expiration or
determination of the period of the Charter prior to the expiration of
the Security Period, the period down to the expiration or determination
of the period of the Charter;
"Charter Rights" means all of the rights of the Owner under or pursuant
to the Charter, the Charter Guarantee and any other guarantee, security
or other assurance given to the Owner at any time in respect of the
Charterer's obligations under or pursuant to the Charter including
(without limitation) the right to receive the Charter Earnings;
"Classification" means the classification +1 Al tanker for oil ESP E0
PP3 with the Classification Society or such other classification as the
Agent shall, at the request of the Owner, have agreed in writing shall
be treated as the Classification in relation to the Ship for the
purposes of the Security Documents;
"Classification Society" means Det Norske Veritas or such other
classification society which the Agent shall, at the request of the
Owner, have agreed in writing shall be treated as the Classification
Society in relation to the Ship for the purposes of the Security
Documents;
"Collateral Instruments" means notes, bills of exchange, certificates of
deposit and other negotiable and non-negotiable instruments, guarantees,
indemnities and other assurances against financial loss and any other
documents or instruments which contain or evidence an obligation (with
or without security) to pay, discharge or be responsible directly or
indirectly for, any indebtedness or liabilities of the Owner or any
other person liable and includes any documents or instruments creating
or evidencing a mortgage, charge (whether fixed or floating), pledge,
lien, hypothecation, assignment, trust arrangement or security interest
of any kind;
"Commercial Management Agreement" means the agreement made or (as the
context may require) to be made between the Charterer and the Commercial
Manager in a form previously approved in writing by the Agent providing
(inter alia) for the Commercial Manager to commercially manage the Ship;
"Commercial Manager means Top Tanker Management Inc. of Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇ or any other person appointed by the Charterer with the prior
written consent of the Agent as commercial manager of the Ship and
includes its successors in title;
"Compulsory Acquisition" means requisition for title or other compulsory
acquisition, requisition, appropriation, expropriation, deprivation,
forfeiture or confiscation for any reason of the Ship by any Government
Entity or other competent authority, whether de jure or de facto, but
shall exclude requisition for use or hire not involving requisition of
title;
"Default" means any Event of Default or any event or circumstance which
with the giving of notice or lapse of time or the satisfaction of any
other condition (or any combination thereof) would constitute an Event
of Default;
"Delivery" means the delivery of the Ship by the Owner, and the
acceptance of the Ship by the Charterer, pursuant to the Charter;
"Delivery Date" means the date on which Delivery occurs;
"DOC" means a document of compliance issued to an Operator in accordance
with rule 13 of the Code;
"Encumbrance" means any mortgage, charge (whether fixed or floating),
pledge, lien, hypothecation, assignment, trust arrangement or security
interest or other encumbrance of any kind securing any obligation of any
person or any type of preferential arrangement (including without
limitation title transfer and/or retention arrangements having a similar
effect);
"Environmental Affiliate" means any agent or employee of the Charterer
or any other Relevant Party or any person having a contractual
relationship with the Charterer or any other Relevant Party in
connection with any Relevant Ship or its operation or the carriage of
cargo and/or passengers thereon and/or the provision of goods and/or
services on or from the Relevant Ship;
"Environmental Approval" means any consent, authorisation, licence or
approval of any governmental or public body or authorities or courts
applicable to any Relevant Ship or its operation or the carriage of
cargo and/or passengers thereon and/or the provision of goods and/or
services on or from such Relevant Ship required under any Environmental
Law;
"Environmental Claim" means any and all enforcement, clean-up, removal
or other governmental or regulatory actions or orders instituted or
completed pursuant to any Environmental Law or any Environmental
Approval together with claims made by any third party relating to
damage, contribution, loss or injury, resulting from any actual or
threatened emission, spill, release or discharge of a Pollutant from any
Relevant Ship;
"Environmental Laws" means all national, international and state laws,
rules, regulations, treaties and conventions applicable to any Relevant
Ship pertaining to the pollution or protection of human health or the
environment including, without limitation, the carriage of Pollutants
and actual or threatened emissions, spills, releases or discharges of
Pollutants;
"Event of Default" means any of the events or circumstances described in
clause 10.1 of the Loan and Guarantee Facility Agreement;
"Expenses" means the aggregate at any relevant time (to the extent that
the same have not been received or recovered by the Mortgagee) of:
(a) all losses, liabilities, costs, charges, expenses, damages and
outgoings of whatever nature (including, without limitation,
Taxes, registration fees and insurance premiums) suffered,
incurred or paid by the Mortgagee in connection with the
exercise of the powers referred to in or granted by this Deed or
otherwise payable by the Owner in accordance with clause 13; and
(b) interest on all such losses, liabilities, costs, charges,
expenses, damages and outgoings from the date on which the same
were suffered, incurred or paid by the Mortgagee until the date
of receipt or recovery thereof (whether before or after
judgment) at a rate per annum calculated in accordance with
clause 3.4 of the Loan and Guarantee Facility Agreement (as
conclusively certified by the Mortgagee);
"Flag State" means the Republic of Liberia or such other state or
territory acceptable to the Agent designated in writing by the Agent
(acting on the instructions of the Majority Banks), at the request of
the Owner, as being the "Flag State" of the Ship for the purposes of the
Security Documents;
"Guarantee" means the guarantee described in recital (B) above;
"Guarantee Amount" means any amount owing by the Guarantee Bank to the
Beneficiary under or pursuant to the Guarantee, which amount is
indemnified by the Owner in accordance with the Loan and Guarantee
Facility Agreement;
"Government Entity" means and includes (whether having a distinct legal
personality or not) any national or local government authority, board,
commission, department, division, organ, instrumentality, court or
agency and any association, organisation or institution of which any of
the foregoing is a member or to whose jurisdiction any of the foregoing
is subject or in whose activities any of the foregoing is a participant;
"Incapacity" means, in relation to a person, the death, bankruptcy,
unsoundness of mind, insolvency, liquidation, dissolution, winding-up,
administration, receivership, amalgamation, reconstruction or other
incapacity of that person whatsoever (and, in the case of a partnership,
includes the termination or change in the composition of the
partnership);
"Insurances" means all policies and contracts of insurance (which
expression includes all entries of the Ship in a protection and
indemnity or war risks association) which are from time to time during
the Security Period in place or taken out or entered into by or for the
benefit of, among others, the Owner and/or the Charterer (whether in the
sole name of the Owner, or in the joint names of the Owner, the
Charterer and the Mortgagee or otherwise) in respect of the Ship (but
not loss of earnings) or otherwise howsoever in connection with the Ship
and all benefits thereof (including claims of whatsoever nature and
return of premiums);
"ISM Code" means the International Management Code for the Safe
Operation of Ships and for Pollution Prevention constituted pursuant to
Resolution A. 741 (18) of the International Maritime Organisation and
incorporated into the International Convention on Safety of Life at Sea
1974 (as amended) and includes any amendment or extensions thereto and
any regulation issued pursuant thereto;
"ISPS Code" means the International Ship and Port Facility Security Code
constituted pursuant to resolution A.924(22) of the International
Maritime Organization now set out in Chapter XI-2 of the International
Convention for the Safety of Life at Sea 1974 (as amended) as adopted by
a Diplomatic Conference of the International Maritime Organisation on
Maritime Security in December 2002 and includes any amendments or
extensions thereto and any regulation issued pursuant thereto;
"ISSC" means an International Ship Security Certificate issued in
respect of the Ship pursuant to the ISPC Code;
"Loan" means the aggregate principal amount owing to the Banks or any of
them pursuant to the Loan and Guarantee Facility Agreement at any
relevant time;
"Loan and Guarantee Facility Agreement" means the agreement referred to
in recital (B) hereto as the same may from time to time be supplemented
and/or amended;
"Loss Payable Clauses" means the provisions regulating the manner of
payment of sums receivable under the Insurances which are to be
incorporated in the relevant insurance documents, such Loss Payable
Clauses to be in the forms set out in Schedule 1 during the Charter
Period (which shall, during the Charter Period, replace the forms of
Loss Payable Clauses specified in the General Assignment) or in such
other forms as may from time to time be required or agreed in writing by
the Mortgagee;
"Management Agreements" means the Commercial Management Agreement and
the Technical Management Agreement and "Management Agreement" means
either of them;
"Managers" means the Commercial Manager and the Technical Manager and
"Manager means either of them;
"Master Swap Agreement" means the 1992 ISDA Master Agreement made
between the Swap Provider and the Owner dated9 March 2006 mentioned in
recital (C) hereto, comprising a 1992 ISDA Master Agreement (and a
Schedule thereto), together with any Confirmations (as defined therein)
supplemental thereto;
"Master Swap Agreement Liabilities" means at any relevant time, all
liabilities actual or contingent, present or future, owing to the Swap
Provider under the Master Swap Agreement;
"Mortgage" means the first preferred mortgage mentioned in recital (E)
hereto; "Mortgagee" includes the successors in title and assignees of
the Mortgagee;
"Notice of Assignment of Insurances" means a notice of assignment in the
form set out in Schedule 2 during the Charter Period (which shall,
during the Charter Period, replace the form of Notice of Assignment of
Insurances specified in the General Assignment), or in such other form
as may from time to time be required or agreed in writing by the
Mortgagee;
"Operating Account" means the interest bearing Dollar account of the
Owner opened or (as the context may require) to be opened with the
Account Bank and includes any sub-accounts thereof and any other account
designated in writing by the Agent to be the Operating Account for the
purposes of this Agreement;
"Operator" means any person who is from time to time during the Security
Period concerned in the operation of the Ship and falls within the
definition of "Company" set out in rule 1.1.2 of the Code;
"Outstanding Indebtedness" means the aggregate of the Loan and the
Guarantee Amount the Master Swap Agreement Liabilities, and interest
accrued and accruing thereon, the Expenses and all other sums of money
from time to time owing by the Owner to the Mortgagee and/or any of the
other Creditors, whether actually or contingently, present or future,
under or pursuant to the Loan and Guarantee Facility Agreement, the
Master Swap Agreement, the Security Documents or any of them;
"Owner" includes the successors in title and permitted assignees of the
Owner; "Owner's Assigned Property" means:
(a) the Charter;
(b) the Charter Guarantee;
(c) the Charter Earnings; and
(d) all other Charter Rights;
"Pollutant" means and includes pollutants, contaminants, toxic
substances, oil as defined in the United States Oil Pollution Act of
1990 and all hazardous substances as defined in the United States
Comprehensive Environmental Response, Compensation and Liability ▇▇▇
▇▇▇▇;
"Related Company" of a person means any Subsidiary of such person, any
company or other entity of which such person is a Subsidiary and any
Subsidiary of any such company or entity;
"Relevant Jurisdiction" means any jurisdiction in which or where any
Security Party is incorporated, resident, domiciled, has a permanent
establishment, carries on, or has a place of business or is otherwise
effectively connected;
"Relevant Party" means the Owner, the Owner's Related Companies, any
other Security Party and any other Security Party's Related Companies;
"Relevant Ship" means the Ship and any other vessel from time to time
(whether before or after the date of this Deed) owned, managed or crewed
by, or chartered to, any Relevant Party;
"Requisition Compensation" means all sums of money or other compensation
from time to time payable during the Security Period by reason of the
Compulsory Acquisition of the Ship;
"Security Documents" means the Loan and Guarantee Facility Agreement,
this Deed, the Mortgage, the General Assignment, the Master Swap
Agreement, the Share Pledge, the Charter Guarantee and any other such
document as is defined in the Loan and Guarantee Facility Agreement as a
Security Document or as may have been or may hereafter be executed to
guarantee and/or secure all or any part of the Loan, the Guarantee
Amount, any interest thereon, and the moneys from time to time owing by
the Owner pursuant to the Loan and Guarantee Facility Agreement and/or
the Master Swap Agreement Liabilities (whether or not such documents,
also secure moneys from time to time owing pursuant to any other
document or agreement);
"Security Parties" means, collectively, the Owner, the Managers, the
Charterer, or any other person who may at any time be a party to any of
the Security Documents (other than the Creditors and the Charter
Guarantor) and "Security Party" means any one of them;
"Security Period" means the period commencing on the date hereof and
terminating upon discharge of the security created by the Security
Documents by payment of all moneys payable thereunder;
"Shareholder" means Dongbuka No. 30 Ship Investment Company of ▇▇▇▇-▇▇▇▇
▇▇▇-▇▇ ,▇▇▇▇▇▇-▇▇,▇▇▇▇▇ , ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇;
"Share Pledge" means the pledge made or (as the context may require) to
be made between the Shareholder and the Agent (as security agent and
trustee on behalf of the Creditors) in substantially the form set out in
Schedule 17, of its rights, title and interest in and to all the shares
in the Owner;
"Ship" means the vessel m.v. "Stopless" registered as a Liberian ship
under Official Number 12600 and includes any share or interest therein
and her engines, machinery, boats, tackle, outfit, equipment, spare
gear, fuel, consumable or other stores, belongings and appurtenances
whether on board or ashore and whether now owned or hereafter acquired
and also any and all additions, improvements and replacements hereafter
made in or to such vessel or any part thereof or in or to her equipment
and appurtenances aforesaid; and
"SMC" means a safety management certificate issued in respect of a Ship
in accordance with rule 13 of the ISM Code;
"Subsidiary" of a person means any company or entity directly or
indirectly controlled by such person, and for this purpose "control"
means either the ownership of more than 50% of the voting share capital
(or equivalent rights of ownership) of such company or entity or the
power to direct its policies and management, whether by contract or
otherwise;
"Technical Manager's Undertaking" means an undertaking and assignment in
relation to the Ship executed or (as the context may require) to be
executed by the Technical Manager in favour of the Agent (as security
agent and trustee on behalf of the Creditors);
"Technical Manager" means V. Ships Management Limited of Eaglehurst,
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇, ▇▇▇ ▇▇▇ or any other person
appointed by the Commercial Manager with the prior written consent of
the Agent as technical manager of the Ship and includes its successors
in title and assignees;
"Total Loss" means:
(a) the actual, constructive, compromised or arranged total loss of
the Ship; or
(b) the Compulsory Acquisition of the Ship; or
(c) the hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation of the Ship (other than where the same
amounts to the Compulsory Acquisition of the Ship) by any
Government Entity, or by persons acting or purporting to act on
behalf of any Government Entity, unless the Ship be released and
restored to the Owner or (during the Charter Period) the
Charterer (as the case may be) from such hijacking, theft,
condemnation, capture, seizure, arrest, detention or
confiscation within thirty (30) days after the occurrence
thereof.
1.2 Insurance terms In clause 8.1.1:
1.2.1 "excess risks" means the proportion (if any) of claims for
general average, salvage and salvage charges and under the
ordinary collision clause not recoverable in consequence of the
value at which the Ship is assessed for the purpose of such
claims exceeding her insured value;
1.2.2 "protection and indemnity risks" means the usual risks
(including oil pollution and freight, demurrage and defence
cover) covered by a United Kingdom protection and indemnity
association or a protection and indemnity association which is
managed in London (including, without limitation, the proportion
(if any) of any sums payable to any other person or persons in
case of collision which are not recoverable under the hull and
machinery policies by reasons of the incorporation in such
policies of clause 8 of the Institute Time Clauses (Hulls)
(1/11/95) or the Institute Amended Running Down Clause (1/10/71)
or any equivalent provision); and
1.2.3 "war risks" includes those risks covered by the standard form of
English marine policy with Institute War and Strikes Clauses
Hulls - Time (1/11/95) attached or similar cover.
1.3 Headings
Clause headings and the table of contents are inserted for convenience
of reference only and shall be ignored in the interpretation of this
Deed.
1.4 Construction of certain terms
In this Deed, unless the context otherwise requires:
1.4.1 references to clauses and Schedules are to be construed as
references to clauses of, and Schedules to, this Deed and
references to this Deed include its Schedules;
1.4.2 references to (or to any specified provision of) this Deed or
any other document shall be construed as references to this
Deed, that provision or that document as in force for the time
being and as amended in accordance with the terms thereof, or,
as the case may be, with the agreement of the relevant parties;
1.4.3 words importing the plural shall include the singular and vice
versa;
1.4.4 references to a person shall be construed as references to an
individual, firm, company, corporation, unincorporated body of
persons or any Government Entity;
1.4.5 references to a "guarantee" shall include references to an
indemnity or other assurance against financial loss including,
without limitation, an obligation to purchase assets or services
as a consequence of a default by any other person to pay any
Indebtedness and "guaranteed" shall be construed accordingly;
and
1.4.6 references to statutory provisions shall be construed as
references to those provisions as replaced or amended or
re-enacted from time to time.
1.5 Conflict with Loan and Guarantee Facility Agreement
As between the Owner and the Mortgagee, this Deed shall be read together
with the Loan and Guarantee Facility Agreement but in case of any
conflict between the two instruments, the provisions of the Loan and
Guarantee Facility Agreement shall prevail.
1.6 Conflict with Charter
If and to the extent that any of the covenants and undertakings given by
the Charterer in this Deed may conflict with any of the provisions of
the Charter, such covenants and undertakings shall (as between the
Mortgagee on the one hand and the Owner and the Charterer on the other
hand but not otherwise) prevail over such provisions.
2 Representations and warranties
2.1 Charterer's Continuing representations and warranties
The Charterer represents and warrants to the Mortgagee (as security
agent and trustee for and on behalf of the Creditors) and the Owner
that:
2.1.1 Due incorporation
it is duly incorporated and validly existing in good standing
under the laws of the Republic of Liberia as a corporation and
has power to carry on its business as it is now being conducted
and to own its property and other assets;
2.1.2 Corporate power
it has power to execute, deliver and perform its obligations
under the Charter and such of the Security Documents to which it
is, or is to be, a party and has power to execute and deliver
and perform its obligations under the Charter Guarantee and the
Security Documents, and all necessary corporate, shareholder and
other action has been taken to authorise the execution, delivery
and performance of the same;
2.1.3 Binding obligations
the Charter and the Security Documents to which it is, or is to
be, a party constitute or will, when executed, constitute its
valid and legally binding obligations enforceable in accordance
with their respective terms;
2.1.4 No conflict with other obligations
the execution and delivery of, the performance of its
obligations under, and compliance with the provisions of the
Charter and the Security Documents to which it is, or is to be,
a party by it will not (a) contravene, any existing applicable
law, statute, rule or regulation or any judgment, decree or
permit to which it is subject, or (b) contravene or conflict
with any provision of its articles of incorporation, by-laws,
statutes or other constitutional documents;
2.1.5 No filings required
it is not necessary to ensure the legality, validity,
enforceability or admissibility in evidence of the Charter or
any of the Security Documents to which it is, or is to be, a
party that they or any other instrument be notarised, filed,
recorded, registered or enrolled in any court, public office or
elsewhere in any Relevant Jurisdiction or that any stamp,
registration or similar tax or charge be paid in any Relevant
Jurisdiction on or in relation to the Charter or any of such
Security Documents and the Charter and each of such Security
Documents are in proper form for its enforcement in the courts
of each Relevant Jurisdiction;
2.1.6 Choice of law
the choice of English law to govern the Charter and the Security
Documents to which it is, or is to be, a party and the
submission by the Charterer to the non-exclusive jurisdiction of
the English courts are valid and binding;
2.1.7 No immunity
neither it nor any of its assets is entitled to immunity on the
grounds of sovereignty or otherwise from any legal action or
proceeding (which shall include, without limitation, suit,
attachment prior to judgment, execution or other enforcement);
and
2.1.8 Consents obtained
every consent, authorisation, licence or approval of, or
registration with or declaration to, governmental or public
bodies or authorities or courts required by it to authorise, or
required by it in connection with, the execution, delivery,
validity, enforceability or admissibility in evidence of the
Charter and the Security Documents to which it is, or is to be,
a party or the performance by it of its obligations under the
Charter and such Security Documents have been obtained or made
and are in full force and effect and there has been no default
in the observance of any of the conditions or restrictions (if
any) imposed in, or in connection with, any of the same.
2.2 Charter Guarantor's Continuing representations and warranties
The Charter Guarantor represents and warrants to the Mortgagee (as
security agent and trustee for and on behalf of the Creditors) and the
Owner that:
2.2.1 Due incorporation
it is duly incorporated and validly existing in good standing
under the laws of the Republic of Liberia as a corporation and
has power to carry on its business as it is now being conducted
and to own its property and other assets;
2.2.2 Corporate power
it has power to execute, deliver and perform its obligations
under the Charter Guarantee and this Deed and has power to
execute and deliver and perform its obligations under the
Charter Guarantee and this Deed, and all necessary corporate,
shareholder and other action has been taken to authorise the
execution, delivery and performance of the same and no
limitation on the powers of the Charter Guarantor to give
guarantees or security will be exceeded as a result of the
execution, delivery and performance of the Charterer's
obligations under this Deed;
2.2.3 Binding obligations
the Charter Guarantee and this Deed constitute or will, when
executed, constitute its valid and legally binding obligations
enforceable in accordance with their respective terms;
2.2.4 No conflict with other obligations
the execution and delivery of, the performance of its
obligations under, and compliance with the provisions of the
Charter Guarantee and this Deed by it will not (a) contravene,
any existing applicable law, statute, rule or regulation or any
judgment, decree or permit to which it is subject or (b)
contravene or conflict with any provision of its articles of
incorporation, by-laws, statutes or other constitutional
documents;
2.2.5 No filings required
it is not necessary to ensure the legality, validity,
enforceability or admissibility in evidence of Charter Guarantee
or this Deed that they or any other instrument be notarised,
filed, recorded, registered or enrolled in any court, public
office or elsewhere in any Relevant Jurisdiction or that any
stamp, registration or similar tax or charge be paid in any
Relevant Jurisdiction on or in relation to the Charter Guarantee
or this Deed and each of the Charter Guarantee and this Deed are
in proper form for its enforcement in the courts of each
Relevant Jurisdiction;
2.2.6 Choice of law
the choice of English law to govern Charter Guarantee and this
Deed and the submission by the Charter Guarantor to the
non-exclusive jurisdiction of the English courts are valid and
binding;
2.2.7 No immunity
neither it nor any of its assets is entitled to immunity on the
grounds of sovereignty or otherwise from any legal action or
proceeding (which shall include, without limitation, suit,
attachment prior to judgement, execution or other enforcement);
and
2.2.8 Consents obtained
every consent, authorisation, licence or approval of, or
registration with or declaration to, governmental or public
bodies or authorities or courts required by it to authorise, or
required by it in connection with, the execution, delivery,
validity, enforceability or admissibility in evidence of the
Charter Guarantee and this Deed or the performance by it of its
obligations under the Charter Guarantee and this Deed has been
obtained or made and is in full force and effect and there has
been no default in the observance of any of the conditions or
restrictions (if any) imposed in, or in connection with, any of
the same.
2.3 Charterer's Initial representations and warranties
The Charterer represents and warrants to the Mortgagee (as security
agent and trustee for and on behalf of the Creditors) and the Owner
that:
2.3.1 No withholding Taxes
no Taxes are imposed by withholding or otherwise on any payment
to be made by it under the Charter or the Security Documents to
which it is, or is to be, a party or are imposed on or by virtue
of its execution or delivery of the Charter or any of such
Security Documents or any other document or instrument to be
executed or delivered under the Charter or any of such Security
Documents;
2.3.2 Ship's employment
(save for the Charter) the Ship is not and will not on the
Delivery Date be subject to any charter or contract or to any
agreement to enter into any charter or contract entered into by
the Charterer which, if entered into by it after the date of
this Deed, would have required the consent of the Mortgagee;
2.3.3 Freedom from Encumbrances
the Charterer is the sole, legal and beneficial owner of the
whole of the Charterer's Assigned Property and neither the
Charterer's Assigned Property nor any part thereof are or will
be on the Delivery Date subject to any Encumbrance created by it
or arising due to its act or omission or its use or operation of
the Ship and it has not (save as disclosed in writing to the
Mortgagee) received notice of any Encumbrance (other than
pursuant to this Deed) in respect thereof created by any other
person;
2.3.4 Commissions etc.
there are no commissions, rebates, premiums or other payments in
connection with the Charter other than as disclosed to the
Mortgagee in writing prior to the date hereof;
2.3.5 Compliance with Environmental Laws and Approvals
except as may already have been disclosed by it in writing to,
and acknowledged in writing by, the Mortgagee:
(a) the Charterer and to the best of its knowledge and
belief (having made due enquiry) its Environmental
Affiliates have complied with the provisions of all
Environmental Laws;
(b) the Charterer and to the best of its knowledge and
belief (having made due enquiry) its Environmental
Affiliates have obtained all Environmental Approvals and
are in compliance with all such Environmental Approvals;
and
(c) neither the Charterer nor to the best of its knowledge
and belief (having made due enquiry) any of its
Environmental Affiliates has received notice of any
Environmental Claim that the Charterer or any such
Environmental Affiliate is not in compliance with any
Environmental Law or any Environmental Approval;
2.3.6 No Environmental Claims
except as may already have been disclosed by it in writing to,
and acknowledged in writing by, the Mortgagee, there is no
Environmental Claim pending or, to the best of its knowledge and
belief (having made due enquiry), threatened against the
Charterer or the Ship or any other ship owned, managed or crewed
by, or chartered to, the Charterer or, to the best of its
knowledge and belief (having made due enquiry) any of its
Environmental Affiliates; and
2.3.7 No potential Environmental Claims
except as may already have been disclosed by it in writing to,
and acknowledged in writing by, the Mortgagee, there has been no
emission, spill, release or discharge of a Pollutant from the
Ship or any other ship owned by, managed or crewed by, or
chartered to, the Charterer nor to the best of its knowledge and
belief (having made due enquiry) from any other ship owned by,
managed or crewed by, or chartered to, the Charterer which could
give rise to an Environmental Claim.
2.4 Charter Guarantor's Initial representations and warranties
The Charter Guarantor represents and warrants to the Mortgagee (as
security agent and trustee for and on behalf of the Creditors) and the
Owner that:
2.5 No withholding Taxes
no Taxes are imposed by withholding or otherwise on any payment to be
made by it under the Charter Guarantee or are imposed on or by virtue of
its execution or delivery of the Charter Guarantee or this Deed or any
other document or instrument to be executed or delivered under the
Charter Guarantee or this Deed;
2.6 Repetition of representations and warranties
On and as of the Delivery Date and (except in relation to the
representations and warranties in clauses 2.3, 2.4 and 5) each Interest
Payment Date during the Charter Period, the Charterer and the Charter
Guarantor shall be deemed to repeat the representations and warranties
in clauses 2.1, 2.2, 2.3 and 2.4 as if made with reference to the facts
and circumstances existing on such day.
3 Assignment
3.1 Charterer's Assignment
By way of security for the Outstanding Indebtedness, the Charterer with
full title guarantee hereby assigns and agrees to assign to the
Mortgagee absolutely all its rights, title and interest in and to the
Charterer's Assigned Property and all its benefits and interests present
and future therein. Provided however that unless and until a Default
shall occur (whereupon all insurance recoveries shall be receivable by
the Mortgagee and applied in accordance with clause 11.1 or clause 11.3
(as the case may be)):
3.1.1 any moneys payable under the Insurances, shall be payable in
accordance with the terms of the relevant Loss Payable Clause
and the Mortgagee will not in the meantime give any notification
to the contrary to the insurers as contemplated by the Loss
Payable Clauses; and
3.1.2 any insurance moneys received by the Mortgagee in respect of any
major casualty (as specified in the relevant Loss Payable
Clause) shall, unless prior to receipt or whilst such moneys are
in the hands of the Mortgagee there shall have occurred a
Default (whereupon such insurance monies shall be applied in
accordance with clause 11.1 or clause 11.3 (as the case may
be)), be paid over to the Charterer upon the Charterer
furnishing evidence satisfactory to the Mortgagee that all loss
and damage resulting from such casualty has been properly made
good and repaired, and that all repair accounts and other
liabilities whatsoever in connection with the casualty have been
fully paid and discharged by the Charterer, provided however
that the insurers with whom the fire and usual marine risks
insurances are effected may, in the case of a major casualty,
and with the previous consent in writing of the Mortgagee, make
payment on account of repairs in the course of being effected.
3.2 Use of Charterer's name
The Charterer covenants and undertakes with the Mortgagee to do or
permit to be done each and every act or thing which the Mortgagee may
from time to time require to be done for the purpose of enforcing the
Mortgagee's rights under this Deed and to allow its name to be used as
and when required by the Mortgagee for that purpose.
3.3 Reassignment
Upon payment and discharge in full to the satisfaction of the Mortgagee
of the Outstanding Indebtedness, the Mortgagee shall, at the request and
cost of the Charterer, re-assign the Charterer's Assigned Property to
the Charterer or as it may direct.
3.4 Liability of Charterer
The Charterer shall remain liable to perform all the obligations assumed
by it in relation to the Assigned Property and the Mortgagee shall be
under no obligation of any kind whatsoever in respect thereof or be
under any liability whatsoever in the event of any failure by the
Charterer to perform its obligations in respect thereof.
4 Owner's Assignment
4.1 By way of security for payment of the Outstanding Indebtedness, the
Owner with full title guarantee hereby assigns and agrees to assign to
the Mortgagee (as security agent and trustee on behalf of the Creditors)
absolutely all its rights, title and interest in and to the Owner's
Assigned Property and all benefits accruing to the Owner thereunder
Provided however that the Charter Earnings shall be payable to the
Operating Account until such time as a Default shall occur and the
Mortgagee shall direct to the contrary whereupon the Owner shall
forthwith, and the Mortgagee may at any time thereafter, instruct the
persons from whom the Charter Earnings are then payable to pay the same
to the Mortgagee (as security agent and trustee on behalf of the
Creditors) or as it may direct and any Charter Earnings then in the
hands of the Owner's brokers or other agents shall be deemed to have
been received by them for the use and on behalf of the Agent.
4.2 Use of Owner's name
The Owner covenants and undertakes with the Mortgagee to do or permit to
be done each and every act or thing which the Mortgagee may from time to
time require to be done for the purpose of enforcing the Mortgagee's
rights under this Deed and to allow its name to be used as and when
required by the Mortgagee for that purpose.
4.3 Reassignment
Upon payment and discharge in full to the satisfaction of the Mortgagee
of the Outstanding Indebtedness, the Mortgagee shall, at the request and
cost of the Owner, re-assign the Owner's Assigned Property to the Owner
or as it may direct.
4.4 Liability of Owner
The Owner shall remain liable to perform all the obligations assumed by
it in relation to the Mortgaged Property and the Mortgagee shall be
under no obligation of any kind whatsoever in respect thereof or be
under any liability whatsoever in the event of any failure by the Owner
to perform its obligations in respect thereof.
4.5 Acknowledgement by Charterer
By its execution of this Deed, each of the Charterer and the Charter
Guarantor has received written notice of, and consents to, the
assignment to the Mortgagee of the Charter, the Charter Earnings and the
other Charter Rights and the Charter Guarantee.
5 Continuing security and other matters
5.1 Continuing security
The security created by this Deed shall:
5.1.1 be held by the Mortgagee (as security agent and trustee for and
on behalf of the Creditors) as a continuing security for the
payment of the Outstanding Indebtedness and the performance and
observance of and compliance with all of the covenants, terms
and conditions contained in the Security Documents, express or
implied, and that the security so created shall not be satisfied
by any intermediate payment or satisfaction of any part of the
amount hereby and thereby secured (or by any settlement of
accounts between the Owner or any other person who may be liable
to the Mortgagee and/or the other Creditors in respect of the
Outstanding Indebtedness or any part thereof and the Mortgagee
and/or the other Creditors) and shall remain in full force and
effect until the Outstanding Indebtedness has been discharged in
full (which expression shall not embrace payment or a dividend
in liquidation or bankruptcy of less than 100%);
5.1.2 be in addition to, and shall not in any way prejudice or affect,
and may be enforced by the Mortgagee without prior recourse to,
the security created by any other of the Security Documents or
by any present or future Collateral Instruments, right or remedy
held by or available to the Mortgagee and/or the other Creditors
or any of them any right or remedy of the Mortgagee and/or the
other Creditors or any of them or any right or remedy of the
Mortgagee thereunder;
5.1.3 not be in any way prejudiced or affected by the existence of any
of the other Security Documents or any such Collateral
Instrument, rights or remedies or by the same becoming wholly or
in part void, voidable or unenforceable on any ground whatsoever
or by the Mortgagee and/or the other Creditors or any of them
dealing with, exchanging, varying or failing to perfect or
enforce any of the same, or giving time for payment or
performance or indulgence or compounding with any other person
liable; and
5.1.4 not in any way be prejudiced or affected by any change in the
constitution of, or any amalgamation or reconstruction of the
Owner, the Mortgagee or any other person or by any legal
limitation, disability, incapacity or other circumstances
relating to the Owner or any other person, whether or not known
to the Mortgagee and/or the other Creditors, by any invalidity
in or irregularity or unenforceability of the obligations of the
Owner or any other person under the Loan and Guarantee Facility
Agreement or any of the other Security Documents or otherwise
and so that in the event that any obligation or purported
obligation of the Owner or any other person which, if
enforceable or valid or continuing, would be secured by this
Deed is or becomes wholly or in part unenforceable or invalid or
terminated for any reason whatsoever, the Owner will keep the
Mortgagee and the other Creditors fully indemnified against any
loss suffered by the Mortgagee and the other Creditors as a
result of any failure by the Owner or such other party to
perform any such obligation or purported obligation.
5.2 Rights additional
All the rights, remedies and powers vested in the Mortgagee (as security
agent and trustee on behalf of the Creditors) hereunder shall be in
addition to and not a limitation of any and every other right, power or
remedy vested in the Mortgagee and/or the other Creditors or any of them
under the Loan and Guarantee Facility Agreement, this Deed, the Master
Swap Agreement, the other Security Documents or any such Collateral
Instrument or at law and that all the powers so vested in the Mortgagee
and/or the other Creditors or any of them may be exercised from time to
time and as often as the Mortgagee and/or the other Creditors or any of
them may deem expedient.
5.2.1 No enquiry
The Mortgagee shall not be obliged to make any enquiry as to the
nature or sufficiency of any payment received by it under this
Deed or to make any claim or take any action to collect any
moneys hereby assigned or to enforce any rights or benefits
hereby assigned to the Mortgagee or to which the Mortgagee (as
security agent and trustee on behalf of the Creditors) may at
any time be entitled under this Deed.
5.3 Obligations of Owner, Charterer and Mortgagee
The Owner and the Charterer shall each remain liable to perform all the
obligations assumed by it in relation to the Owners Assigned Property
and the Charterer's Assigned Property and the Mortgagee shall be under
no obligation of any kind whatsoever in respect thereof or be under any
liability whatsoever in the event of any failure by the Owner or the
Charterer to perform its obligations in respect thereof.
5.4 Discharge of Mortgage
This Deed shall continue in full force and effect after any discharge of
the Mortgage.
5.5 Liability unconditional
The rights, remedies and powers vested in the Mortgagee under this Deed
shall not be affected nor shall this Deed be discharged or reduced by
reason of:
5.5.1 the Incapacity or any change in the name, style or constitution
of the Owner or any other person liable;
5.5.2 the Mortgagee granting any time, indulgence or concession to, or
compounding with, discharging, releasing or varying the
liability of the Owner or any other person liable or renewing,
determining, varying or increasing any accommodation, facility
or transaction or otherwise dealing with the same in any manner
whatsoever or concurring in, accepting or varying any
compromise, arrangement or settlement or omitting to claim or
enforce payment from the Owner or any other person liable; or
5.5.3 any act or omission which would not have discharged or affected
the security constituted by the Charterer under this Deed had it
been a principal debtor instead of a guarantor or by anything
done or omitted which but for this provision might operate to
exonerate such security.
5.6 Waiver of Charterer's rights
Until the Outstanding Indebtedness has been paid, discharged or
satisfied in full (and notwithstanding payment of a dividend in any
liquidation or under any compromise or arrangement) and notwithstanding
that the security created by this Deed and the other Security Documents
may have been realised, the Charterer agrees that, without the prior
written consent of the Mortgagee, it will not:
5.6.1 exercise its rights of subrogation, reimbursement and indemnity
against the Owner or any other person liable;
5.6.2 demand or accept repayment in whole or in part of any
indebtedness now or hereafter due to the Charterer from the
Owner or from any other person liable or demand or accept any
Collateral Instrument in respect of the same or dispose of the
same;
5.6.3 take any step to enforce any right against the Owner or any
other person liable in respect of any Outstanding Indebtedness
and/or the Master Swap Agreement Liability; or
5.6.4 claim any set-off or counterclaim against the Owner or any other
person liable or claim or prove in competition with the
Mortgagee and/or the other Creditors or any of them in the
liquidation of the Owner or any other person liable or have the
benefit of, or share in, any payment from or composition with,
the Owner or any other person liable or any other Collateral
Instrument now or hereafter held by the Mortgagee and/or the
other Creditors or any of them for the Outstanding Indebtedness
or for the obligations or liabilities of any other person liable
but so that, if so directed by the Mortgagee, it will prove for
the whole or any part of its claim in the liquidation of the
Owner on terms that the benefit of such proof and of all money
received by it in respect thereof shall be paid to the Mortgagee
for application in or towards discharge of the Outstanding
Indebtedness in such manner as the Mortgagee shall deem
appropriate.
5.7 Suspense account
Any money received in connection with this Deed (whether before or after
any Incapacity of the Owner or the Charterer) which would (but for this
Deed) have been payable to the Charterer may, if an Event of Default has
happened, be placed to the credit of a suspense account with a view to
preserving the rights of the Mortgagee to prove for the whole of its and
the other Creditors' claims against the Owner or any other person liable
or may be applied in or towards satisfaction of the Outstanding
Indebtedness.
5.8 Settlements conditional
Any release, discharge or settlement between the Charterer and the
Mortgagee shall be conditional upon no security, disposition or payment
to the Mortgagee and/or the other Creditors or any of them by the Owner
or any other person liable being void, set aside or ordered to be
refunded pursuant to any enactment or law relating to bankruptcy,
liquidation, administration or insolvency or for any other reason
whatsoever and if such condition shall not be fulfilled the Mortgagee
shall be entitled to enforce this Deed subsequently as if such release,
discharge or settlement had not occurred and any such payment had not
been made.
5.9 Delivery of certain property
If, contrary to the provisions of this Deed, the Charterer takes or
receives the benefit of any security or receives or recovers any money
or other property, such security, money or other property shall be held
on trust for the Mortgagee (as security agent and trustee on behalf of
the Creditors) and shall be delivered to the Mortgagee on demand.
5.10 Certificates conclusive
Any certificate submitted by the Mortgagee to the Charterer as to the
amount or any part thereof hereby secured shall, in the absence of
manifest error, be conclusive and binding on the Charterer.
5.11 Collateral Instruments
The Mortgagee shall not be obliged to make any claim or demand on the
Owner or to resort to any Collateral Instrument or other means of
payment now or hereafter held by or available to it before enforcing
this Deed and no action taken or omitted by the Mortgagee in connection
with any such Collateral Instrument or other means of payment shall
discharge, reduce, prejudice or affect the security created by the
Charterer under this Deed nor shall the Mortgagee be obliged to apply
any money or other property received or recovered in consequence of any
enforcement or realisation of any such Collateral Instrument or other
means of payment in reduction of the Outstanding Indebtedness.
6 Charterer's undertakings
The Charterer hereby covenants with the Mortgagee (as security agent and
trustee for and on behalf of the Creditors) and undertakes that
throughout the Charter Period:
6.1.1 Notice
it will from time to time upon the request of the Mortgagee give
written notice (in such form and to such persons as the
Mortgagee may reasonably require) of the assignment contained in
clause 3.1 to any person from whom any part of the Charterers
Assigned Property is or may be due and will procure that the
interest of the Mortgagee in the Insurances shall be endorsed on
the instruments of insurance from time to time issued in
connection with the Insurances as are placed with the Approved
Brokers by reason of a Notice of Assignment of Insurances
(signed by the Charterer, the Owner and by any other assured who
shall have assigned its interest in the Insurances to the
Mortgagee);
6.1.2 Negative undertakings relating to Charter
it will not without the prior written consent of the Mortgagee:
(a) Assignments
assign or otherwise dispose of the Charterer's rights
and obligations under the Charter;
(b) Variations
agree to any variation of the Charter;
6.1.3 Performance of Charter obligations
it will perform its obligations under the Charter;
6.1.4 Sub-chartering
it will not without the prior written consent of the Mortgagee
sub-let the Ship on demise charter for any period;
6.1.5 Total Loss recovery
it will, in the event that, upon a Total Loss of the Ship, the
Mortgagee is disabled from recovering under the Insurances or
any of them or the amount of the recovery thereunder is
diminished and such disablement or diminution results from any
breach by the Charterer of any of its obligations under this
Deed and/or the Charter, pay to the Mortgagee on demand a sum
(which shall be applied in accordance with clause 12.1 as if the
same had been a recovery under the Insurances in respect of such
Total Loss) equal to the amount which would but for such
disablement have been recoverable under the Insurances or (as
the case may be) a sum equal to the amount hereby the insurance
recovery has been diminished;
6.1.6 Sister ship arrest
it will, in the event of the Ship at any time being arrested,
seized, detained or subjected to distress or levied upon by
reason of any process, claim or Encumbrance of whatsoever nature
arising out of the use or operation of the Ship by the Charterer
or any of its agents, employees or sub-charterers or any other
vessel owned or operated or managed by or chartered to the
Charterer or any of its affiliates or its or their agents,
employees or charterers or sub-charterers, at its own expense
take prompt action to secure the release of the Ship and be
responsible for discharging each and every liability in
connection with any such process, claim or Encumbrance;
6.1.7 Sister ship indemnity
it will indemnify the Owner and the Mortgagee and the other
Creditors and hold each of them harmless against all liabilities
of whatsoever nature (including penalties claims demands orders
or judgments) which the Owner or the Mortgagee and/or the other
Creditors or any of them may suffer or incur in respect of the
Ship and which arise out of the use or operation of the Ship or
of any other vessel owned or operated or managed by or chartered
to the Charterer or any of its affiliates or its or their
agents, employees or charterers or sub-charterers;
6.1.8 Compliance with Environmental Laws
it will comply with, and procure that all its Environmental
Affiliates comply with, all Environmental Laws including,
without limitation, requirements relating to ▇▇▇▇▇▇▇ and
establishment of financial responsibility and will obtain and
comply with, and procure that all its Environmental Affiliates
obtain and comply with, all Environmental Approvals;
6.1.9 Ship's name and registration
(a) it will not change the name of the Ship;
(b) it will not do or suffer to be done anything, or omit to
do anything, the doing or omission of which could or
might result in the Ship not being eligible for
registration under the laws and flag of the Flag State
on and after Delivery or result in such registration
being forfeited or imperilled or which could or might
result in the Ship being required to be registered
otherwise than under the laws and flag of the Flag
State;
6.1.10 Abandonment
it will not without the prior written consent of the Mortgagee
(and then only subject to any conditions the Mortgagee may
impose) abandon the Ship;
6.1.11 Charterers Manager
it will not without the prior written consent of the Mortgagee
(and then only on and subject to such terms as the Mortgagee may
agree) appoint a commercial or technical manager of the Ship
other than the Managers or terminate or amend the terms of
either of the Management Agreements;
6.1.12 Encumbrances
it will not without the prior written consent of the Mortgagee
(and then only subject to such conditions as the Mortgagee may
impose) create or purport or agree to create or permit to arise
or subsist any Encumbrance over or in respect of any part of the
Charterer's Assigned Property otherwise than to or in favour of
the Mortgagee; and
6.1.13 Notification of certain events
it will notify the Mortgagee forthwith by telex confirmed by
letter of:
(a) any petition or notice of meeting to consider any
resolution to wind up the Charterer (or any event
analogous thereto under the laws of the place of its
incorporation);
(b) the occurrence of any Default of which it is aware; or
(c) the occurrence of any Environmental Claim against the
Charterer, the Ship, any other Relevant Party or any
other Relevant Ship or any incident, event or
circumstances which may give rise to any such
Environmental Claim.
7 General Undertakings
7.1 The Charter Guarantor hereby agrees and undertakes to the Mortgagee (as
security agent and trustee for and on behalf of the Secured Creditors)
that it will at all times throughout the Security Period:
7.1.1 deliver to the Mortgagee sufficient copies of each of the
following documents:
(a) not later than one hundred and eighty (180) days after
the end of each financial year, the audited balance
sheet and profit and loss account of the Charter
Guarantor and the audited consolidated balance sheet and
the consolidated profit and loss account of the Group
for such financial year and a cash flow statement for
the Group for such financial year together with the
report of the auditors thereon, the notes thereto and
the directors' report thereon, if any;
(b) at the time of issue thereof every report, circular,
notice or like document issued by the Charter Guarantor
to its shareholders or creditors generally;
(c) at the time of the delivery of the annual audited
financial statements, a statement from the Charter
Guarantor's auditors stating the respective amounts of
the Net Asset Value, Book Equity, the Total Debt and the
Total Market Value Adjusted Assets, in respect of or, as
the case may be, as at the end of the financial year to
which such financial statements relate indicating the
manner in which the same have been calculated and
whether or not the limits imposed by clauses 7.2.1,
7.2.2, 7.2.6 and 7.2.7 have or have not been exceeded at
such time and so that each such statement shall (in the
absence of manifest error or in the absence of the
Mortgagee reaching a different determination pursuant to
clause 1.2.10) be conclusive evidence of such amounts or
facts for the purposes of this Deed; and
7.1.2 comply with its obligations under the Charter Guarantee.
7.2 Financial Undertakings
The Charter Guarantor hereby agrees and undertakes to the Mortgagee (as
security agent and trustee for and on behalf of the Secured Creditors)
that it will at all times throughout the Security Period:
7.2.1 ensure that, for the first nine (9) months after the Drawdown
Date, a minimum amount of twenty million Dollars ($20,000,000)
shall be standing to the credit of the Charter Guarantor's
Account and that for the period commencing nine months after the
Drawdown Date and ending on the final date of the Security
Period, a minimum amount of twenty five million dollars
($25,000,000) shall be standing to the credit of the Charter
Guarantor's Account and further ensure that at any time there
are no Encumbrances whatsoever existing over or in relation to
such minimum amounts;
7.2.2 ensure that an aggregate minimum amount of fifty million Dollars
shall at all times during the Security Period be standing to the
credit of accounts of the Charter Guarantor (including the
Charter Guarantor's Account) and the Charter Guarantor shall
evidence compliance with the terms of this clause at no later
than three (3) monthly intervals throughout the Security Period
or otherwise promptly upon the Mortgagee's first written
request;
7.2.3 endeavour that any Excess Cash Flow in relation to the Ship will
be paid into the Charter Guarantor's Account;
7.2.4 provide details to the Agent at three (3) monthly intervals
evidencing the operating expenses and the Earnings of the Ship;
7.2.5 ensure that on the Drawdown Date, the minimum average length of
time that Fleet Vessels are employed on time charter for is
eighteen months;
7.2.6 ensure that its Net Asset Value at all times exceeds
$125,000,000; and
7.2.7 ensure that its Book Equity shall at all times exceed
$75,000,000.
7.2.8 For the purpose of this clause 7.2 and clause 7.3, the following
expressions shall have the following meanings:
"Applicable Accounting Principles" means accounting principles,
concepts, bases and policies generally adopted and accepted in the
United States of America consistently applied;
"Book Equity" means the aggregate of the amounts paid-up or credited as
paid-up on the Charter Guarantor's issued share capital and the amount
of the consolidated capital and revenue reserves of the Group (including
any share premium account, capital redemption reserve fund and any
credit balance on the consolidated profit and loss account of the Group)
all as shown by the latest audited consolidated balance sheet and profit
and loss account of the Group delivered under this Deed but after
(a) deducting any debit balance on such consolidated profit and loss
account;
(b) deducting any amount shown in such consolidated balance sheet in
respect of goodwill (including goodwill arising on
consolidation) and other intangible assets;
(c) deducting (so far as not otherwise excluded as attributable to
minority interests) a sum equal to the aggregate of the amount
by which the book value of any fixed assets of any member of the
Group has been written up after 31 December 2005 (or, in the
case of a company becoming a subsidiary after that date, the
date on which that company became a subsidiary) by way of
revaluation not being, in any such case, a revaluation of all
the Group's fixed assets in accordance with a valuation report
from independent valuers approved by the Mortgagee so long as
any such revaluation is carried out not more frequently than
once every five years. For the purposes of this paragraph (c)
any increase in the book value of any fixed asset resulting from
its transfer by one member of the Group to another member of the
Group shall be deemed to result from a writing up of its book
value by way of revaluation;
(d) excluding amounts set aside for taxation as at the date of such
balance sheet and making such adjustments as may be appropriate
in respect of any significant additional taxation expected to
result from transactions carried out by any member of the Group
after such date and not reflected in that balance sheet;
(e) deducting all amounts attributable to minority interests in
Subsidiaries;
(f) making such adjustments as may be appropriate in respect of any
variation in the amount of such paid up share capital or any
such reserves after the date of the relevant balance sheet (but
so that no such adjustment shall be made in respect of any
variation in profit and loss account except to the extent of any
profit or loss, calculated on a cumulative basis, recorded in
the consolidated profit and loss account of the Group delivered
to the Mortgagee before the date of this Deed, or under clause
7.1.1 in respect of any subsequent period);
(g) making such adjustments as may be appropriate in respect of any
distribution declared, recommended or made by any member of the
Group (otherwise than attributable directly or indirectly to the
Charter Guarantor) out of profits earned up to and including the
date of the latest audited balance sheet of that member of the
Group to the extent that such distribution is not provided for
in that balance sheet;
(h) making such adjustments as may be appropriate in respect of any
variation in the interests of the Charter Guarantor in its
Subsidiaries since the date of the latest published audited
consolidated balance sheet of the Group;
(i) if the calculation is required for the purpose of or in
connection with a transaction under or in connection with which
any company is to become or cease to be a Subsidiary of the
Charter Guarantor, making all such adjustments as would be
appropriate if that transaction had been carried into effect;
and
(j) making such adjustments as may be appropriate in the opinion of
the Mortgagee in order that the above amounts are calculated in
accordance with the Original Accounting Principles;
"Earnings" means all earnings of the Ship payable under or pursuant to
any Time Charters entered into in relation to the ship, or else any
other charters entered into by the Charterer in respect of the
employment of the Ship;
"Encumbrance" means any mortgage, charge (whether fixed or floating),
pledge, lien, hypothecation, assignment, trust arrangement or security
interest or other encumbrance of any kind securing any obligation of any
person or any type of preferential arrangement (including without
limitation title transfer and/or retention arrangements having a similar
effect);
"Excess Cash Flow" means any Earnings of the Ship minus the aggregate of
the Charter Earnings and the operating expenses in relation to the Ship;
"Finance Lease" means a lease treated as a finance lease pursuant to the
Applicable Accounting Principles.
"Fleet Vessels" means any vessels owned, or chartered on long-term
demise charter to any member of the Group;
"Group" means, together, the Charter Guarantor and its Subsidiaries and
"member of the Group" means any of them;
"Net Asset Value" means, at any relevant time, the amount in Dollars
resulting after deducting the Total Debt from the Total Market Value
Adjusted Assets, in either case at such time;
"Original Accounting Principles" means those accounting principles,
standards and practices which were used in the preparation of the
consolidated audited financial statements of the Group as at 31 December
2005, and for the year then ended and, to the extent that they do not
conflict with those principles, standards and practices, such other
accounting principles, standards and practices as were generally
acceptable in the United States of America on 31 December 2005;
"Total Debt" means the aggregate principal amount (including any fixed
or minimum premium payable on final repayment) of:
(a) moneys borrowed or raised by the Charter Guarantor and its
Subsidiaries;
(b) bonds, notes, loan stock, debentures, commercial paper or other
debt securities issued by the Charter Guarantor or any of its
Subsidiaries not for the time being beneficially owned by the
Charter Guarantor or any of its Subsidiaries;
(c) sums outstanding under acceptances by the Charter Guarantor or
any of its Subsidiaries or by any bank or acceptance house under
acceptance credits opened on behalf of the Charter Guarantor or
any Subsidiary;
(d) deferred indebtedness of the Charter Guarantor or any of its
Subsidiaries for payment of the acquisition or construction
price for assets or services acquired or constructed;
(e) rental payments under Finance Leases;
(f) receivables sold or discounted with a right of recourse to the
Charter Guarantor or any of its Subsidiaries;
(g) the nominal amount of any issued and paid up share capital
(other than equity share capital) of any Subsidiary not
beneficially owned by the Charter Guarantor or another
Subsidiary;
(h) preference share capital redeemable prior to the last day of the
period of the Charter;
(i) indebtedness secured by any Encumbrance over all or any part of
the undertaking, property, assets, rights or revenues of the
Charter Guarantor or any of its Subsidiaries irrespective of
whether or not such indebtedness is supported by a personal
covenant on the part of the Charter Guarantor or any of its
Subsidiaries;
(j) indebtedness incurred in respect of swaps, forward exchange
contracts, futures or other derivatives;
(k) any other liability arising from a transaction having the
commercial effect of a borrowing or the raising of money;
(l) obligations under guarantees in respect of the obligations of
any other person which, if such person were the Charter
Guarantor or a Subsidiary, would fall within paragraphs (a) to
(k) above,
PROVIDED THAT
(i) moneys owing by the Charter Guarantor to a Subsidiary or by a
Subsidiary to the Charter Guarantor or to another Subsidiary
shall not be taken into account;
(ii) the principal amount of Total Debt deemed to be outstanding in
relation to Finance Leases or hire purchase agreements shall be
the present value of the minimum lease or hire payments
discounted at the interest rate implicit in the relevant lease
or hire purchase agreement; and
"Total Market Value Adjusted Assets' means the aggregate of:
(a) the value (less depreciation computed in accordance with
generally accepted international accounting principles
consistently applied) on a consolidated basis of all tangible
fixed assets of the Group, as stated in the relevant
consolidated financial statements of the Group, but excluding
any ships at the relevant time owned by members of the Group
which, for the purposes of such consolidated financial
statements, are included in the consolidated tangible fixed
assets of the Group (for the purposes of clauses 7.2 and 7.3,
the "Relevant Ships"); and
(b) the aggregate of the market value of the Relevant Ships, as such
market value shall have been most recently determined (as of the
date of the relevant calculation) pursuant to the provisions of
clause 7.3 of this Deed by means of valuations obtained by the
Mortgagee in accordance with the provisions of clause 7.3 of
this Deed (and not the value of the Relevant Ships as stated in
the relevant consolidated financial statements of the Group).
7.2.9 All the terms defined in this clause 7.2 and used in this Deed
are to be determined on a consolidated basis in respect of the
Group and (except as items are expressly included or excluded in
the relevant definition or clause) are used and shall be
construed in accordance with Applicable Accounting Principles
and as determined from the latest consolidated financial
statements of the Group delivered to the Mortgagee pursuant to
clause 7.1.1.
7.2.10 The compliance of the Charter Guarantor with the covenants set
out in clauses 7.2.1, 7.2.2, 7.2.6 and 7.2.7 shall be determined
on the basis of calculations made by the Mortgagee at any time
by reference to then latest consolidated financial statements of
the Group delivered to the Mortgagee pursuant to clause 7.1.1.
For the avoidance of doubt, it is hereby agreed that the
Mortgagee shall be entitled to make such determinations and/or
calculations at any time when, and in relation to any period in
relation to which, the Charter Guarantor shall be obliged to
comply with each of the covenants out in clauses 7.2.1, 7.2.2
and 7.2.7 without regard to when any such financial statements
are due to be delivered or have been actually delivered to the
Mortgagee pursuant to clause 7.1.
7.2.11 For the purposes of this clause 7.2:
(a) no item shall be deducted or credited more than once in
any calculation; and
(b) any amount expressed in a currency other than Dollars
shall be converted into Dollars in accordance with
Applicable Accounting Principles.
7.3 Valuation of Relevant Ships
7.3.1 Valuations
Each of the Relevant Ships shall, for the purposes of this
clause 7, be valued in Dollars as and when the Mortgagee shall
require. Each such valuation of a Relevant Ship shall be made by
an independent firm of shipbrokers appointed by the Mortgagee.
Such valuation shall be made without, unless required by the
Mortgagee, physical inspection, and on the basis of a sale for
prompt delivery for cash at arm's length, on normal commercial
terms as between a willing buyer and a willing seller and
without taking into account the benefit of any charterparty or
other employment of such Relevant Ship. The value of each of the
Relevant Ships determined in accordance with the provisions of
this clause 7.3 shall be binding upon the parties hereto for the
purposes of calculating the Total Market Value Adjusted Assets
until such time as any further such valuations shall be
obtained.
7.3.2 Information
The Charter Guarantor undertakes to the Mortgagee to supply to
the Mortgagee and to any such shipbroker such information
concerning any Relevant Ship and its condition as such
shipbrokers may reasonably require for the purpose of making any
such valuation.
7.3.3 Costs
All costs in connection with the Mortgagee obtaining any
valuation of each of the Relevant Ships referred to in clause
7.3.1 shall be borne by the Owner.
8 Covenants concerning insurance and operational matters
8.1 Covenants
The Charterer hereby covenants with the Mortgagee (as security agent and
trustee for and on behalf of the Creditors) and undertakes throughout
the Charter Period:
8.1.1 Insurance
(a) Insured risks, amounts and terms
to insure and keep the Ship insured free of cost and
expense to the Mortgagee and in the joint names only of
the Owner and the Charterer or, if so required by the
Mortgagee, in the joint names of the Owner and the
Mortgagee and the Charterer (but without liability on
the part of the Mortgagee for premiums or calls):
(i) against fire and usual marine risks (including
excess risks) and war risks, on an agreed value
basis, in such amounts and upon such terms as
shall from time to time be acceptable to the
Mortgagee. For the avoidance of doubt, the
Charterer hereby covenants with the Mortgagee
and undertakes throughout the Security Period to
ensure that the Ship will be insured for not
less than the greater of:
(A) the value of the Ship for the time being
(as determined by the Mortgagee pursuant
to clause 8.2.2 of the Loan and
Guarantee Facility Agreement); and
(B) such amount as will be at least equal to
one hundred and thirty per cent (130%)
of the aggregate of the Loan and the
Guarantee Amount;
(ii) and upon such terms as should from time to time
be approved in writing by the Mortgagee;
(iii) against protection and indemnity risks
(including pollution risks for the highest
amount in respect of which cover is or may
become available for ships of the same type,
size, age and flag as the Ship and a freight,
demurrage and defence cover) for the full value
and tonnage of the Ship (as approved in writing
by the Mortgagee) and upon such terms as shall
from time to time be approved in writing by the
Mortgagee;
(iv) in respect of such other matters of whatsoever
nature and howsoever arising in respect of which
insurance would be maintained by a prudent owner
of the Ship.
and to pay to the Mortgagee the cost (as conclusively
certified by the Mortgagee) of (A) any mortgagee's
interest insurance (including, if the Mortgagee shall so
require, mortgagee's additional perils (including all
P&I risks) coverage) which the Mortgagee may from time
to time effect in respect of the Ship upon such terms in
such amounts as it shall deem desirable and (B) any
other insurance cover which the Mortgagee may from time
to time effect in respect of the Ship and/or in respect
of its interest or potential third party liability as
mortgagee of the Ship as the Mortgagee shall deem
desirable having regard to any limitations in respect of
amount or extent of cover which may from time to time be
applicable to any of the other insurances referred to in
this clause 5.1.1(a);
(b) Approved brokers, insurers and associations
to effect the insurances aforesaid in such currency as
the Mortgagee may approve and through the Approved
Brokers and with such insurance companies and/or
underwriters as shall from time to time be approved in
writing by the Mortgagee; provided however that the
insurances against war risks and protection and
indemnity risks may be effected by the entry of the Ship
with such war risks and protection and indemnity
associations as shall from time to time be approved in
writing by the Mortgagee;
(c) Fleet liens, set-off and cancellation
if any of the insurances referred to in clause (a) form
part of a fleet cover, to procure that the Approved
Brokers shall undertake to the Mortgagee that they shall
neither set off against any claims in respect of the
Ship any premiums due in respect of other vessels under
such fleet cover or any premiums due for other
insurances, nor cancel the insurance for reason of
non-payment of premiums for other vessels under such
fleet cover or of premiums for such other insurances,
and shall undertake to issue a separate policy in
respect of the Ship if and when so requested by the
Mortgagee;
(d) Payment of premiums and calls
punctually to pay all premiums, calls, contributions or
other sums payable in respect of all such insurances and
to produce all relevant receipts or other evidence of
payment when so required by the Mortgagee;
(e) Renewal
at least 14 days before the relevant policies, contracts
or entries expire, to notify the Mortgagee of the names
of the brokers and/or the war risks and protection and
indemnity associations proposed to be employed by the
Charterer or any other party for the purposes of the
renewal of such insurances and of the amounts in which
such insurances are proposed to be renewed and the risks
to be covered and, subject to compliance with any
requirements of the Mortgagee pursuant to this clause
8.1.1, to procure that appropriate instructions for the
renewal of such insurances on the terms so specified are
given to the Approved Brokers and/or to the approved war
risks and protection and indemnity associations at least
10 days before the relevant policies, contracts or
entries expire, and that the Approved Brokers and/or the
approved war risks and protection and indemnity
associations will at least 7 days before such expiry (or
within such shorter period as the Mortgagee may from
time to time agree) confirm in writing to the Mortgagee
as and when such renewals have been effected in
accordance with the instructions so given;
(f) Guarantees
to arrange for the execution and delivery of such
guarantees or indemnities as may from time to time be
required by any protection and indemnity or war risks
association;
(g) Hull policy documents, notices, loss payable clauses and
brokers' undertakings
to deposit with the Approved Brokers (or procure the
deposit of) all slips, cover notes, policies,
certificates of entry or other instruments of insurance
from time to time issued in connection with such of the
insurances referred to in clause (a) as are effected
through the Approved Brokers and procure that the
interest of the Mortgagee shall be endorsed thereon by
incorporation of the relevant Loss Payable Clause and,
where the Insurances have been assigned to the
Mortgagee, by means of a Notice of Assignment of
Insurances (signed by the Owner and the Charterer and by
any other assured who shall have assigned its interest
in the Insurances to the Mortgagee) and that the
Mortgagee shall be furnished with pro forma copies
thereof and a letter or letters of undertaking from the
Approved Brokers in such form as shall from time to time
be required by the Mortgagee;
(h) Associations' loss payable clauses, undertakings and
certificates
to procure that any protection and indemnity and/or war
risks associations in which the Ship is for the time
being entered shall endorse the relevant Loss Payable
Clause on the relevant certificate of entry or policy
and shall furnish the Mortgagee with a copy of such
certificate of entry or policy and a letter or letters
of undertaking in such form as shall from time to time
be required by the Mortgagee;
(i) Extent of cover and exclusions
to take all necessary action and comply with all
requirements which may from time to time be applicable
to the Insurances (including, without limitation, the
making of all requisite declarations within any
prescribed time limits and the payment of any additional
premiums or calls) so as to ensure that the Insurances
are not made subject to any exclusions or qualifications
to which the Mortgagee has not given its prior written
consent and are otherwise maintained on terms and
conditions from time to time approved in writing by the
Mortgagee;
(i) Correspondence with brokers and associations
to provide to the Mortgagee, at the time of each such
communication, copies of all written communications
between the Charterer and the Approved Brokers and
approved war risks and protection and indemnity
associations which relate to compliance with
requirements from time to time applicable to the
Insurances including, without limitation, all requisite
declarations and payments of additional premiums or
calls referred to in clause (i);
(k) Collection of claims
to do all things necessary and provide all documents,
evidence and information to enable the Mortgagee to
collect or recover any moneys which shall at any time
become due in respect of the Insurances;
(l) Employment of Ship
not to employ the Ship or suffer the Ship to be employed
otherwise than in conformity with the terms of the
Insurances (including any warranties express or implied
therein) without first obtaining the consent of the
insurers to such employment and complying with such
requirements as to extra premium or otherwise as the
insurers may prescribe;
(m) Application of recoveries
to apply all sums receivable under the Insurances which
are paid to it in accordance with the Loss Payable
Clauses in repairing all damage and/or in discharging
the liability in respect of which such sums shall have
been received;
8.1.2 Ship's registration
not to do or suffer to be done anything, or omit to do anything
the doing or omission of which could or might result in one
registration of Ship as a Liberian ship being forfeited or
imperilled or which could or might result in the Ship being
required to be registered under any other flag than the Liberian
flag and not to register the Ship or permit its registration
under any other flag without the prior written consent of the
Mortgagee;
8.1.3 Repair
to keep the Ship in a good and efficient state of repair and
procure that all repairs to or replacement of any damaged, worn
or lost parts or equipment are effected in such manner (both as
regards workmanship and quality of materials) as not to diminish
the value of the Ship;
8.1.4 Modification; removal of parts; equipment owned by third parties
not without the prior written consent of the Mortgagee to, or
suffer any other person to:
(a) make any modification to the Ship in consequence of
which her structure, type or performance characteristics
could or might be materially altered or her value
materially reduced; or
(b) remove any material part of the Ship or any equipment
the value of which is such that its removal from the
Ship would materially reduce the value of the Ship
without replacing the same with equivalent parts or
equipment which are owned by the Owner free from
Encumbrances; or
(c) install on the Ship any equipment owned by a third party
which cannot be removed without causing damage to the
structure or fabric of the Ship;
8.1.5 Maintenance of class; compliance with regulations
to maintain the Classification as the class of the Ship and to
comply with and ensure that the Ship at all times complies with
the provisions of the Merchant Shipping Acts and all regulations
and requirements (statutory or otherwise) from time to time
applicable to vessels registered under the laws and flag of the
Flag State or otherwise applicable to the Ship;
8.1.6 Surveys
to submit the Ship to continuous surveys and such periodical or
other surveys as may be required for classification purposes and
to supply to the Mortgagee copies of all survey reports issued
in respect thereof;
8.1.7 Inspection
to ensure that the Mortgagee, by surveyors or other persons
appointed by it for such purpose, may board the Ship at all
reasonable times for the purpose of inspecting her and to afford
all proper facilities for such inspections and for this purpose
to give the Mortgagee reasonable advance notice of any intended
drydocking of the Ship (whether for the purpose of
classification, survey or otherwise);
8.1.8 Prevention of and release from arrest
promptly to pay and discharge all debts, damages, liabilities
and outgoings whatsoever which have given or may give rise to
maritime, statutory or possessory liens on, or claims
enforceable against, the Ship, her Insurances or any part
thereof and, in the event of a writ or libel being filed against
the Ship, her Insurances or any part thereof, or of any of the
same being arrested, attached or levied upon pursuant to legal
process or purported legal process or in the event of detention
of the Ship in exercise or purported exercise of any such lien
or claim as aforesaid, to procure the release of the Ship, her
Insurances from such arrest, detention attachment or levy or, as
the case may be, the discharge of the writ or libel forthwith
upon receiving notice thereof by providing bail or procuring the
provision of security or otherwise as the circumstances may
require;
8.1.9 Employment
not to employ the Ship or permit her employment in any manner,
trade or business which is forbidden by Liberian law, or which
is unlawful or illicit under the law of any relevant
jurisdiction, or in carrying illicit or prohibited goods, or in
any manner whatsoever which may render her liable to
condemnation in a prize court, or to destruction, seizure,
confiscation, penalty or sanctions and, in the event of
hostilities in any part of the world (whether war be declared or
not), not to employ the Ship or permit her employment in
carrying any contraband goods, or enter or trade to or to
continue to trade in any zone which has been declared a war zone
by any Government Entity or by the Ship's war risks insurers
unless the prior written consent of the Mortgagee is obtained
and such special insurance cover as the Mortgagee may require
shall have been effected by the Charterer and at the expense of
the Charterer;
8.1.10 Information
promptly to furnish the Mortgagee with all such information as
it may from time to time require regarding the Ship, her
employment, position and engagements, particulars of all towages
and salvages, and copies of all charters and other contracts for
her employment, or otherwise howsoever concerning it;
8.1.11 Notification of certain events
to notify the Mortgagee forthwith by telex thereafter confirmed
by letter of:
(a) any damage to the Ship requiring repairs the cost of which will
or might exceed the Casualty Amount;
(b) any occurrence in consequence of which the Ship has or may
become a Total Loss;
(c) any requisition of the Ship for hire;
(d) any requirement or recommendation made by any insurer or the
Classification Society or by any competent authority which is
not, or cannot be, complied with in accordance with its terms;
or
(e) any arrest or detention of the Ship or any exercise or purported
exercise of a lien or other claim on the Ship or the Insurances
or any part thereof;
(f) any petition or notice of meeting to consider any resolution to
wind-up the Charterer (or any event analogous thereto under the
laws of the place of its incorporation); or
(g) the occurrence of any Default;
8.1.12 Payment of outgoings and evidence of payments
promptly to pay all tolls, dues and other outgoings whatsoever
in respect of the Ship and the Ship's Insurances and to keep
proper books of account in respect of the Ship and, as and when
the Mortgagee may so require, to make such books available for
inspection on behalf of the Mortgagee, and to furnish
satisfactory evidence that the wages and allotments and the
insurance and pension contributions of the Master and crew are
being promptly and regularly paid and that all deductions from
crew's wages in respect of any applicable tax liability are
being properly accounted for and that the Master has no claim
for disbursements other than those incurred by him in the
ordinary course of trading on the voyage then in progress;
8.1.13 Repairers' liens
not without the prior written consent of the Mortgagee to put
the Ship into the possession of any person for the purpose of
work being done upon her in an amount exceeding or likely to
exceed the Casualty Amount unless such person shall first have
given to the Mortgagee in terms satisfactory to it, a written
undertaking not to exercise any lien on the Ship for the cost of
such work or otherwise;
8.1.14 Chartering
save for any Time Charter, not without the prior written consent
of the Mortgagee (which the Mortgagee shall have full liberty to
withhold) and, if such consent is given, only subject to such
conditions as the Mortgagee may impose, to let the Ship:
(a) on demise charter for any period;
(b) by any time or consecutive voyage charter for a term
which exceeds or which by virtue of any optional
extensions therein contained might exceed twelve (12)
months' duration;
(c) on terms whereby more than two (2) months' hire (or the
equivalent) is payable in advance; or
(d) below the market rate prevailing at the time when the
Ship is fixed or other than on arms' length terms;
8.1.15 Sharing of Earnings
not without the prior written consent of the Mortgagee (and then
only subject to such conditions as the Mortgagee may impose) to
enter into any agreement or arrangement whereby the Earnings may
be shared with any other person;
8.1.16 Manager
not without the prior written consent of the Mortgagee to
appoint a manager of the Ship other than the Commercial Manager
or the Technical Manager, or terminate or amend the terms of the
Management Agreements;
8.1.17 Notice of Mortgage
to place and at all times and places to retain a properly
certified copy of the Mortgage (which shall form part of the
Ship's documents) on board the Ship with her papers and cause
such certified copy of the Mortgage to be exhibited to any and
all persons having business with the Ship which might create or
imply any commitment or encumbrance whatsoever on or in respect
of the Ship (other than a lien for crew's wages and salvage) and
to any representative of the Mortgagee and to place and keep
prominently displayed in the navigation room and in the Master's
cabin of the Ship a framed printed notice in plain type reading
as follows:
"NOTICE OF MORTGAGE"
This Ship is subject to a first preferred mortgage in favour of
[here insert name of Mortgagee] of [here insert address of
Mortgagee]. Under the said mortgage, neither the Owner nor any
charterer nor the Master of this Ship has any right, power or
authority to create, incur or permit to be imposed upon this
Ship any commitments or encumbrances whatsoever other than for
crew's wages and salvage"
and in terms of the said notice it is hereby agreed that save
and subject as otherwise herein provided, neither the Owner nor
the Charterer nor any other charterer nor the Master of the Ship
nor any other person has any right, power or authority to
create, incur or permit to be imposed upon the Ship any lien
whatsoever other than for crew's wages and salvage;
8.1.18 Anti-drug abuse
without prejudice to clause 8.1.9, to take all necessary and
proper precautions to prevent any infringements of the Anti-Drug
Abuse Act of 1986 of the United States of America or any similar
legislation applicable to the Ship in any jurisdiction in or to
which the Ship shall be employed or located or trade or which
may otherwise be applicable to the Ship and/or the Owner and/or
the Charterer and, if the Mortgagee shall so require, to enter
into a "Carrier Initiative Agreement" with the United States
Customs Service and to procure that the same agreement (or any
similar agreement hereafter introduced by any Government Entity
of the United States of America) is maintained in full force and
effect and performed by the Charterer;
8.1.19 Compliance with environmental laws
to comply with, and procure that all Environmental Affiliates of
the Charterer comply with, all Environmental Laws including,
without limitation, requirements relating to ▇▇▇▇▇▇▇ submission
of oil response plans, designations of qualified individuals and
establishment of financial responsibility and to obtain and
comply with, and procure that all Environmental Affiliates of
the Charterer obtain and comply with, all Environmental
Approvals; and
8.1.20 Compliance with ISM Code
comply and will procure that any Operator will comply with and
ensure that the Ship and any Operator will comply with the
requirements of the ISM Code, including (but not limited to) the
maintenance and renewal of valid certificates pursuant thereto
throughout the Security Period;
8.1.21 Withdrawal of DOC and SMC
procure that any Operator will, immediately inform the Mortgagee
if there is any threatened or actual withdrawal of its DOC or
the SMC in respect of the Ship;
8.1.22 Issuance of DOC and SMC
procure that any Operator will, promptly inform the Mortgagee
upon the issue to the Owner or any Operator of a DOC and to the
Ship of an SMC or the receipt by the Owner or any Operator of
notification that its application for the same has been refused;
8.1.23 ISPS Code compliance
and will procure that any Operator of the Ship will:
(a) maintain at all times a valid and current ISSC in respect of
such Ship;
(b) immediately notify the Mortgagee in writing of any actual or
threatened withdrawal, suspension, cancellation or modification
of the ISSC in respect of the Ship;
(c) procure that the Ship will comply at all times with the ISPS
Code; and
8.1.24 Substitute performance of Mortgage
To the extent that, pursuant to the Charter or this Deed, the
Charterer duly performs and discharges (or procures the
performance and discharge of) the duties and liabilities
undertaking by the Owner in the Mortgage, then such performance
and discharge of the said duties and liabilities by the
Charterer shall, to that extent, be deemed to be proper and due
performance and discharge of the Owner's duties and liabilities
under the Mortgage.
9 Powers of Mortgagee to protect security and remedy defaults
9.1 Protective action
The Mortgagee (as security agent and trustee on behalf of the Creditors)
shall, without prejudice to its other rights, powers and remedies under
any of the Security Documents, be entitled (but not bound) at any time,
and as often as may be necessary, to take any such action as it may in
its discretion think fit for the purpose of protecting or maintaining
the security created by this Deed and the other Security Documents, and
all Expenses attributable thereto shall be payable by the Owner on
demand.
9.2 Remedy of defaults
Without prejudice to the generality of the provisions of clause 9.1:
9.2.1 if the Charterer fails to comply with any of the provisions of
clause 8.1.1 the Mortgagee shall be entitled (but not bound) to
effect and thereafter to maintain all such insurances upon the
Ship as in its discretion it may think fit in order to procure
the compliance with such provisions or alternatively, to require
the Ship (at the Charterer's risk) to remain in, or to proceed
to and remain in a port designated by the Mortgagee until such
provisions are fully complied with;
9.2.2 if the Charterer fails to comply with any of the provisions of
clauses 8.1.3, 8.1.5 or 8.1.6, the Mortgagee shall be entitled
(but not bound) to arrange for the carrying out of such repairs,
changes or surveys as it may deem expedient or necessary in
order to procure the compliance with such provisions; and
9.2.3 if the Charterer fails to comply with any of the provisions of
clause 8.1.8 the Mortgagee shall be entitled (but not bound) to
pay and discharge all such debts, damages, liabilities and
outgoings as are therein mentioned and/or to take any such
measures as it may deem expedient or necessary for the purpose
of securing the release of the Ship in order to procure the
compliance with such provisions,
and the Expenses attributable to the exercise by the Mortgagee
of any such powers shall be payable by the Owner to the
Mortgagee on demand.
10 Powers of Mortgagee on Event of Default
10.1 Powers
Upon the happening of any Event of Default, the Mortgagee (as security
agent and trustee for and on behalf of the Creditors) shall become
forthwith entitled by notice given to the Owner in accordance with the
provisions of clause 10.2 of the Loan and Guarantee Facility Agreement,
or, as regards the Master Swap Agreement, in accordance with the
relevant terms of the Master Swap Agreement, to declare the Outstanding
Indebtedness to be due and payable immediately or in accordance with
such notice, whereupon the Outstanding Indebtedness shall become so due
and payable and (whether or not the Mortgagee shall have given any such
notice) the Mortgagee shall become forthwith entitled, as and when it
may see fit, to put into force and exercise in relation to the Owner's
Assigned Property and/or the Charterer's Assigned Property or any part
thereof all or any of the rights, powers and remedies possessed by it as
mortgagee and/or assignee of the Owner's Assigned Property and/or the
Charterer's Assigned Property (whether at law, by virtue of the Mortgage
and this Deed or otherwise) and in particular (without limiting the
generality of the foregoing):
10.1.1 to require that all policies, contracts, certificates of entry
and other records relating to the Insurances (including details
of and correspondence concerning outstanding claims) be
delivered forthwith to such adjusters and/or brokers and/or
other insurers as the Mortgagee may nominate;
10.1.2 to collect, recover, compromise and give a good discharge for,
all claims then outstanding or thereafter arising under the
Insurances or any of them or in respect of any other part of the
Owner's Assigned Property and/or the Charterer's Assigned
Property, and to take over or institute (if necessary using the
name of the Owner or, as the case may be, the Charterer) all
such proceedings in connection therewith as the Mortgagee in its
absolute discretion thinks fit, and, in the case of the
Insurances, to permit the brokers through whom collection or
recovery is effected to charge the usual brokerage therefore;
10.1.3 to discharge, compound, release or compromise claims in respect
of the Ship or any other part of the Owner's Assigned Property
and/or the Charterer's Assigned Property which have given or may
give rise to any charge or lien or other claim on the Ship or
any other part of the Owner's Assigned Property and/or the
Charterer's Assigned Property or which are or may be enforceable
by proceedings against the Ship or any other part of the Owner's
Assigned Property and/or the Charterer's Assigned Property; and
10.1.4 to recover from the Owner on demand all Expenses incurred or
paid by the Mortgagee in connection with the exercise of the
powers (or any of them) referred to in this clause 10.1.
10.2 Liability of Mortgagee
The Mortgagee shall not be liable as mortgagee in possession in respect
of all or any of the Owner's Assigned Property and/or the Charterer's
Assigned Property to account or be liable for any loss upon realisation
or for any neglect or default of any nature whatsoever in connection
therewith for which a mortgagee in possession may be liable as such.
11 Application of moneys
11.1 Application
All moneys received by the Mortgagee (as security agent and trustee for
and on behalf of the Creditors) in respect of:
recovery under the Insurances (other than under any loss of earnings
insurance and any such sum or sums as may have been received by the
Mortgagee (as security agent and trustee for and on behalf of the
Creditors) in accordance with the relevant Loss Payable Clause in
respect of a major casualty as therein defined and paid over to the
Charterer as provided in clause 3.1.2 or which fall to be otherwise
applied under clause 11.3);
11.1.2 Requisition Compensation; and
11.1.3 the Owner's Assigned Property,
shall be held by it upon trust in the first place to pay or make
good the Expenses and the balance shall be applied in the manner
specified in clause 13.1 of the Loan and Guarantee Facility
Agreement and the surplus (if any) shall be paid to the Owner,
the Charterer or such other person as may for the time being be
entitled thereto.
11.2 Shortfalls
In the event that the balance referred to in clause 11.1 is insufficient
to pay in full the whole of the Outstanding Indebtedness, the Mortgagee
shall be entitled to collect the shortfall from the Owner or any other
person liable for the time being therefore.
11.3 Application of Insurances received by Mortgagee
Any moneys received by the Mortgagee in respect of the Insurances (other
than in respect of recovery under any loss of earnings insurance or in
respect of a Total Loss) pursuant to the Mortgage and/or the assignments
by the Charterer contained in clause 3.1 and 5.2 shall:
11.3.1 if received by the Mortgagee, or in the hands of the Mortgagee
after the occurrence of a Default but prior to the occurrence of
an Event of Default, be retained by the Mortgagee and shall be
paid over by the Mortgagee to the Charterer (during the Charter
Period) at such times, in such amounts and for such purposes
and/or shall be applied by the Mortgagee in or towards
satisfaction of any sums from time to time accruing due and
payable by the Owner under the Security Documents or any of them
or by virtue of payment demanded thereunder, in each case the
Mortgagee may in its absolute discretion determine; and
11.3.2 if received by the Mortgagee, or in the hands of the Mortgagee,
after the occurrence of an Event of Default, be applied by the
Mortgagee in the manner specified in clause 11.1 and/or clause
11.3, as the Mortgagee may in its absolute discretion determine.
12 Remedies cumulative and other provisions
12.1 No implied waivers; remedies cumulative
No failure or delay on the part of the Mortgagee and/or the
Creditors or any of them to exercise any right, power or remedy
vested in it under any of the Security Documents shall operate
as a waiver thereof, nor shall any single or partial exercise by
the Mortgagee and/or the Creditors or any of them of any right,
power or remedy nor the discontinuance, abandonment or adverse
determination of any proceedings taken by the Mortgagee and/or
the Creditors or any of them to enforce any right, power or
remedy preclude any other or further exercise thereof or
proceedings to enforce the same or the exercise of any other
right, power or remedy nor shall the giving by the Mortgagee of
any consent to any act which by the terms of this Deed requires
such consent prejudice the right of the Mortgagee to withhold or
give consent to the doing of any other similar act. The remedies
provided in the Security Documents are cumulative and are not
exclusive of any remedies provided by law.
12.2 Delegation
The Mortgagee shall be entitled, at any time and as often as may be
expedient, to delegate all or any of the powers and discretions vested
in it by the Mortgage and this Deed (including the power vested in it by
virtue of clause 14) or any of the other Security Documents in such
manner, upon such terms, and to such persons as the Mortgagee in its
absolute discretion may think fit.
13 Costs and indemnity
13.1 Costs
The Owner shall pay to the Mortgagee and/or any of the other Creditors
(as security agent and trustee for and on behalf of the Creditors) on
demand on a full indemnity basis all reasonable expenses or liabilities
of whatsoever nature (including legal fees, fees of insurance advisers,
printing, out-of-pocket expenses, stamp duties, registration fees and
other duties or charges) together with any value added tax or similar
tax payable in respect thereof, incurred by the Mortgagee and/or any of
the other Creditors in connection with the enforcement of, or
preservation of any rights under, this Deed or otherwise in respect of
the Outstanding Indebtedness and the security therefor or in connection
with the preparation, completion, execution or registration of this Deed
.
13.2 Mortgagee's indemnity
The Owner hereby agrees and undertakes to indemnify the Mortgagee and
each of the other Creditors against all losses, actions, claims,
expenses, demands, obligations and liabilities whatever and whenever
arising which may now or hereafter be incurred by the Mortgagee and/or
any of the other Creditors, or by any manager, agent, officer or
employee for whose liability, act or omission it or he may be
answerable, in respect of, in relation to, or in connection with
anything done or omitted in the exercise or purported exercise of the
powers contained this Deed or otherwise in connection therewith and
herewith or with any part of the Owner and the Owner's Assigned Property
or the Charterer's Assigned Property or otherwise howsoever in relation
to, or in connection with, any of the matters dealt with in this Deed.
14 Attorney
14.1 Power
By way of security, the Owner and the Charterer each hereby irrevocably
appoints the Mortgagee (as security agent and trustee for and on behalf
of the Creditors) to be its attorney generally for and in its name and
on its behalf and as its act and deed or otherwise to execute, seal and
deliver and otherwise perfect and do all such deeds, assurances,
agreements, instruments, acts and things which may be required for the
full exercise of all or any of the rights, powers or remedies conferred
by this Deed or which may be deemed proper in or in connection with all
or any of the purposes aforesaid. The power hereby conferred shall be a
general power of attorney under the Powers of ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, and the
Owner and the Charterer ratifies and confirms, and agrees to ratify and
confirm, any deed, assurance, agreement, instrument, act or thing which
the Mortgagee may execute or do pursuant thereto. Provided always that
such power shall not be exercisable by or on behalf of the Mortgagee
until the happening of an Event of Default.
14.2 Exercise of power
The exercise of such power by or on behalf of the Mortgagee shall not
put any person dealing with the Mortgagee upon any enquiry as to whether
any Event of Default has happened, nor shall such person be in any way
affected by notice that no such Event of Default has happened, and the
exercise by the Mortgagee of such power shall be conclusive evidence of
the Mortgagee's right to exercise the same.
14.3 Filings
The Owner and the Charterer each hereby irrevocably appoints the
Mortgagee (as security agent and trustee for and on behalf of the
Creditors) to be its attorney in its name and on its behalf and as its
act and deed or otherwise of it, to agree the form of and to execute and
do all deeds, instruments, acts and things in order to file, record,
register or enrol the Mortgage and/or this Deed in any court, public
office or elsewhere which the Mortgagee may in its discretion consider
necessary or advisable, now or in the future, to ensure the legality,
validity, enforceability or admissibility in evidence thereof and any
other assurance, document, act or thing required to be executed by the
Owner and the Charterer pursuant to clause 15.
15 Further assurance
The Charterer hereby further undertakes at its own expense from time to
time to execute, sign, perfect, do and (if required) register every such
further assurance, document, act or thing as in the opinion of the
Mortgagee may be necessary or desirable for the purpose of more
effectually mortgaging and charging the Charterer's Assigned Property or
perfecting the security constituted or intended to be constituted by
this Deed.
16 Sale of Ship
16.1 Termination of Charter
Notwithstanding anything contained in the Charter, if and when the
Mortgagee becomes entitled to put into force and exercise all the powers
possessed by it as mortgagee of the Ship or otherwise pursuant to the
Mortgage or at any time thereafter, the Mortgagee shall be entitled (but
not bound) to determine the Charter at any time by notice in writing to
the Owner and the Charterer which notice shall operate to determine the
Charter forthwith if the Ship is then in port and free of cargo or
otherwise upon completion of the voyage (including discharge of cargo if
any) upon which the Ship was engaged at the time when the said notice to
determine was given. Upon determination of the Charter pursuant to this
clause 16.1 hereof all liabilities whatsoever of the Owner thereunder
shall be absolutely discharged and extinguished.
16.2 Preservation of Owner's rights
If the circumstances in which the Mortgagee becomes entitled under
clause 16.1 to determine the Charter shall constitute or include grounds
on which the Owner was entitled to determine the same, any determination
by the Mortgagee shall (as between the Owner and the Charterer) operate
as an acceptance by the Owner of the Charterer's repudiation of the
Charter and the Owner's right to recover damages in respect of such
repudiation shall be fully preserved.
16.3 Remedy of Owner's breach
Notwithstanding anything herein contained, the Owner shall remain liable
to perform all the obligations assumed by it under the Charter and the
Mortgagee shall have no obligations whatsoever thereunder or be under
any liability whatsoever to the Charterer in event of any failure by the
Owner to perform its obligations thereunder or hereunder provided
however that:
16.3.1 a notice in writing (which shall set out full particulars of the
matters complained of and which is hereinafter called the
"notice of complaint") shall be immediately given by the
Charterer to the Mortgagee in event of any breach or alleged
breach of the Charter by the Owner by reason whatsoever the
Charterer claims to be entitled to determine the Charter;
16.3.2 within fifteen (15) days after receipt by the Mortgagee of any
notice of complaint by the Mortgagee shall be entitled (but not
bound) to notify the Charterer in writing of its intention to
remedy the matters complained of by such notice of complaint and
any remedial measures thereafter taken by the Mortgagee shall be
without prejudice to the Charterer's right to claim against the
Owner in respect of any loss and damage suffered by the
Charterer by reason of such breach but in no circumstances shall
the Mortgagee be under any liability therefore or for any loss
or damage suffered by the Charterer arising from delay or
otherwise in effecting such remedial measures as the Mortgagee
(whose decision shall be final) deems appropriate; and
16.3.3 all expenses whatsoever incurred by the Mortgagee in or about
such remedial measures as may be undertaken on its behalf
pursuant to clause 16.3.2 shall be recoverable by the Mortgagee
from the Owner on demand but payment by the Owner to the
Mortgagee pursuant to such demand shall not as between the Owner
and the Charterer operate as an admission by the Owner of
liability for the matters complained of in the relevant notice
of complaint.
16.4 Sale free of or subject to Charter
Notwithstanding anything herein contained, in the event of a sale of the
Ship during the Charter Period pursuant to the power in that behalf
vested in the Mortgagee by virtue of the Security Documents, such sale
shall be free of or subject to the Charter at the option of the
Mortgagee.
16.5 Sale subject to Charter
If the Ship is sold subject to the Charter (which expression means that
the purchaser of the Ship or any other person chartering the Ship from
the purchaser shall as from the date on which the Ship is registered in
the name of the purchaser assume all future obligations and acquire all
future rights and benefits under the Charter), the Owner and/or the
Charterer shall enter into such form of agreement with the purchaser as
the Mortgagee may require to the intent that such purchaser or other
person shall be substituted in place of the Owner as owner or disponent
owner of the Ship for the purposes of the Charter.
16.6 Sale free of Charter
Without prejudice to clause 16.1, if the Ship is sold free of the
Charter, the Owner and the Charterer shall enter into such form of
agreement or agreements as the Mortgagee may require for determination
of the Charter by mutual consent.
17 Continuation of Charter Period
The Charterer shall continue to pay charterhire under the Charter on the
days and in the amounts required under the Charter notwithstanding that
the Ship shall become a Total Loss or that the Charterer shall be
permanently deprived of her use for any other reason prior to the end of
the Charter Period, provided that no further instalments of charterhire
shall become due and payable on any date after the earlier of the expiry
of the period for the prepayment of the Loan specified in clause 4.3 of
the Loan and Guarantee Facility Agreement or the date upon which the
Loan is prepaid in full in accordance with clauses 4.3 and 4.5 of the
Loan and Guarantee Facility Agreement.
18 Notices
18.1 Every notice, request, demand or other communication under this Deed
shall:
18.1.1 be in writing delivered personally or by first-class prepaid
letter (airmail if available) or telex or facsimile transmission
or other means of telecommunication in permanent written form;
18.1.2 be deemed to have been received in the case of a letter, when
delivered personally or three (3) days after it has been put in
to the post and, in the case of a telex or facsimile
transmission or other means of telecommunication in permanent
written form, at the time of despatch (provided that if the date
of despatch is not a business day in the country of the
addressee or if the time of despatch is after the close of
business in the country of the addressee it shall be deemed to
have been received at the opening of business on the next such
business day); and
18.1.3 be sent:
(a) to the Owner at:
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇ ▇▇▇▇., ▇, ▇▇▇▇▇▇ ▇-▇▇
▇▇▇▇▇▇-▇▇, ▇▇▇▇▇, ▇▇▇▇▇
Fax No.: ▇(▇▇▇) ▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇-▇▇▇▇ ▇▇▇
(b) to the Charterer at:
c/o Top Tanker Management Inc.
109-111 ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇ ▇▇▇▇▇▇
Fax no: + ▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇-▇
Attention: Stamatis Tsantanis
(c) to the Mortgagee at:
Fortis Bank (Nederland) N.V.
▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Fax no: ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
Attention: Cees Kamphof
(d) to the Charter Guarantor at:
c/o Top Tanker Management Inc.
109-111 ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇ ▇▇▇▇▇▇
Fax no: + ▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇-▇
Attention: Stamatis Tsantanis
or to such other address and/or numbers as is notified by one
party to the other parties under this Deed.
19 Counterparts
This Deed may be entered into in the form of two or more counterparts,
each executed by one or more of the parties, and, provided all the
parties shall so execute this Deed, each of the executed counterparts,
when duly exchanged or delivered, shall be deemed to be an original but,
taken together, they shall constitute one instrument.
20 Severability of provisions
Each of the provisions in this Deed are severable and distinct from the
others, and if at any time one or more such provisions is or becomes
invalid, illegal or enforceable, the validity, legality and
enforceability of the remaining provisions of this Deed shall not in any
way be affected or impaired thereby.
21 Law and jurisdiction
21.1 Law
This Deed is governed by, and shall be construed in accordance with,
English law.
21.2 Submission to jurisdiction For the benefit of the Mortgagee, the parties
hereto irrevocably agree that any legal action or proceedings in
connection with this Deed may be brought in the English courts, or in
the courts of any other country chosen by the Mortgagee, each of which
shall have jurisdiction to settle any disputes arising out of or in
connection with this Deed. Each of the Owner the Charterer and the
Charter Guarantor irrevocably and unconditionally submits to the
jurisdiction of the English courts, and the courts of any country chosen
by the Mortgagee and the Owner, the Charterer and the Charter Guarantor
irrevocably designate, appoint and empower DLA ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
UK LLP at present of ▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ (in the case of the
Owner) and Top Tankers (UK) Limited at present of ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇ ▇▇▇▇▇▇ (in the case of the Charterer and the Charter Guarantor) to
receive, for it and on its behalf, service of process issued out of the
English courts in any legal action or proceedings arising out of or in
connection with this Deed. The submission to such jurisdiction shall not
(and shall not be construed so as to) limit the right of the Mortgagee
to take proceedings against the Owner and/or the Charterer and/or the
Charter Guarantor 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. The parties further agree that only the courts of England and not
those of any other State shall have jurisdiction to determine any claim
which the Owner or the Charterer or the Charter Guarantor may have
against the Mortgagee arising out of or in connection with this Deed.
21.3 Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇
No term of this Deed shall be enforceable pursuant to the Contracts
(Rights of Third Parties) ▇▇▇ ▇▇▇▇ by a person who is not a party to
this Deed.
IN WITNESS whereof this Deed has been duly executed as a deed the day and year
first above written
Schedule 1
Forms of Loss Payable Clauses
(1) Hull and machinery (marine and war risks)
By a General Assignment dated ______________________ 2006, KOMARF HOPE
30 Shipping Company Limited (the "Owner") and by a Quadripartite Deed
dated 2006, VITSI SHIPPING CO. LTD. of ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ of Liberia (the "Charterer") have each assigned to FORTIS BANK
(NEDERLAND) N.V. of ▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇ Rotterdam, The Netherlands
(the "Mortgagee") (as security agent and trustee for and on behalf of
the Creditors as herein defined (the "Creditors")) all the Owner's and
the Charterer's rights, title and interest in and to all policies and
contracts of insurance from time to time taken out or entered into by or
for the benefit of the Owner and/or the Charterer in respect of m.v.
"Stopless" and accordingly:
(a) all claims hereunder in respect of an actual or constructive or
compromised or arranged total loss, and all claims in respect of
a major casualty (that is to say any casualty the claim in
respect of which exceeds five hundred thousand Dollars
($500,000) (or the equivalent in any other currency) inclusive
of any deductible shall be paid in full to the Mortgagee (as
security agent and trustee for and on behalf of the Creditors)
or to its order; and
(b) all other claims hereunder shall be paid in full to the
Charterer or to its order, unless and until the Mortgagee shall
have notified insurers hereunder to the contrary, whereupon all
such claims shall be paid to the Mortgagee (as security agent
and trustee for and on behalf of the Creditors) or to its order.
(2) Protection and indemnity
Payment of any recovery which KOMARF HOPE 30 Shipping Company Limited of
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (the "Owner") or VITSI SHIPPING CO.
LTD. (the "Charterer") is entitled to make out of the funds of the
Association in respect of any liability, costs or expenses incurred by
the Owner or the Charterer, shall be made to the Owner or the Charterer
or to its order, unless and until the Association receives notice to the
contrary from FORTIS BANK (NEDERLAND) N.V. of ▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (the "Mortgagee") in which event all
recoveries shall thereafter be paid to the Mortgagee or their order;
provided that no liability whatsoever shall attach to the Association,
its Managers or their agents for failure to comply with the latter
obligation until the expiry of two clear business days from the receipt
of such notice.
Schedule 2
Forms of Notices of Assignment of Insurances
Notice of Assignment
(For attachment by way of endorsement to the Policy)
KOMARF HOPE 30 SHIPPING of ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (the "Owner") and
VITSI SHIPPING CO. LTD. (the "Charterer") of ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
of Liberia the owners and demise charterers respectively of the m.v. "Stopless"
HEREBY GIVE NOTICE that by a General Assignment dated _______________ 2006 and
entered into by the Owner with FORTIS BANK (NEDERLAND) N.V. (the "Mortgagee")
(as security agent and trustee for and on behalf of the Creditors as herein
defined (the "Creditors")) and by a Quadripartite Deed dated ___________ 2006
and entered into by the Charterer and the Owner with the Mortgagee (as security
agent and trustee for and on behalf of the Creditors), there has been assigned
by us to the Mortgagee (as security agent and trustee for and on behalf of the
Creditors) as mortgagees of the said vessel all insurances in respect thereof,
including the insurances constituted by the policy whereon this notice is
endorsed.
Signed
For and on behalf of
KOMARF HOPE 30 Shipping Company Limited
Dated 2006
Signed
For and on behalf of
VITSI SHIPPING CO. LTD.
Dated 2006
SIGNED, SEALED and DELIVERED as a
DEED by Jun Hyung ▇▇▇ /s/ Jun Hyung ▇▇▇
for and on behalf of --------------------
KOMARF HOPE 30 SHIPPING COMPANY Authorised Signatory
pursuant to a unanimous Written
Consent of Board of Directors
and Sole Shareholder
dated 9 March 2006
in the presence of:
Witness: /s/ ▇▇▇▇▇ ▇▇▇▇▇ Yu
Name: ▇▇▇▇▇ ▇▇▇▇▇ Yu
Address: ▇▇▇, ▇▇▇▇▇ ▇▇▇▇., ▇, ▇▇▇▇▇▇ ▇-▇▇
▇▇▇▇▇▇-▇▇, ▇▇▇▇▇, ▇▇▇▇▇
Occupation: Deputy General Manager, KOMARF
SIGNED, SEALED and DELIVERED as a
DEED by
for and on behalf of
VITSI SHIPPING CO. LTD.
pursuant to a power of attorney
dated 2006 -------------------------
Attorney-in-Fact
in the presence of:
Witness:
Name:
Address:
Occupation:
SIGNED, SEALED and DELIVERED as a DEED by
for and on behalf of
KOMARF HOPE 30 SHIPPING COMPANY
pursuant to a power of attorney
dated 2006
in the presence of:
Witness:
Name:
Address:
Occupation:
SIGNED, SEALED and DELIVERED as a
DEED by ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ /s/ C. Kamphof
for and on behalf of -------------------
VITSI SHIPPING CO. LTD. Attorney-in-Fact
pursuant to a power of attorney
dated 8 March 2006
Witness: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Address: Top Tanker Management Inc.
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇
Occupation: Advocate
SIGNED, SEALED and DELIVERED as a
DEED by ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ /s/ C. Kamphof
for and on behalf of -------------------
TOP TANKERS INC. Attorney-in-Fact
pursuant to a power of attorney
dated 8 March 2006
in the presence of:
Witness: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Address: Top Tanker Management Inc.
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇
Occupation: Advocate
SIGNED, SEALED and DELIVERED as a
DEED by
for and on behalf of
FORTIS BANK (NEDERLAND) N.V.
pursuant to a power of attorney
dated 2006
in the presence of:
Witness:
Name:
Address:
Occupation:
SIGNED, SEALED and DELIVERED as a
DEED by
for and on behalf of
TOP TANKERS INC.
pursuant to a power of attorney
dated 2006
in the presence of:
Witness:
Name:
Address:
Occupation:
SIGNED, SEALED and DELIVERED as a
DEED by Cees Kamphof /s/ C. Kamphof
for and on behalf of -------------------
FORTIS BANK (NEDERLAND) N.V. Attorney-in-Fact
pursuant to a power of attorney
dated 8 March 2006
in the presence of:
Witness: /s/ ▇. ▇. Meyee
Name: ▇. ▇. Meyee
Address: ▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ Rotterdam
The Netherlands
Occupation: Secretary