Exhibit 4.3
Dated as of the 26th day of November 1997
Secured Loan Facility
of up to US$214,500,000
made by
BANK OF TAIWAN
(as Lead Arranger)
CREDIT AGRICOLE INDOSUEZ
THE FUJI BANK, LIMITED
THE INDUSTRIAL BANK OF JAPAN, LIMITED
(as Arrangers)
CREDIT LYONNAIS, OFFSHORE BANKING UNIT, TAIPEI
(as Senior Manager)
THE BANKS and FINANCIAL INSTITUTIONS
referred to in Schedule 1
(the Lenders)
and
INDOSUEZ ASIA SHIPFINANCE SERVICES LIMITED
(as Agent)
to
FARAWAY MARITIME SHIPPING COMPANY
(as Borrower)
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AMENDED AND RESTATED FINANCIAL AGREEMENT
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CONTENTS
Clause Heading Page No.
------ ------- --------
1. Purpose and Definitions..........................................4
2. The Facility....................................................15
3. Interest and Interest Periods...................................17
4. Repayment and Prepayment........................................18
5. Fees and Expenses...............................................18
6. Payments and Taxes; Accounts and Calculations...................19
7. Representations and Warranties..................................21
8. Undertakings....................................................25
9. Conditions......................................................30
10. Events of Default...............................................31
11. Indemnities.....................................................34
12. Unlawfulness, Increased Costs, Alternative Interest Rates.......35
13. Security and Set-off............................................33
14. Assignment and Lending Offices..................................40
15. Agent and the Lenders...........................................42
16. Notices and other Matters.......................................42
17. Law and Jurisdiction............................................43
SCHEDULES
---------
1. The Lenders and their Commitments...............................48
2. Form of Drawdown Notice.........................................49
3. List of Documents and Evidence..................................50
4. Repayment Schedule..............................................57
5. Form of Transfer Certificate....................................58
Page 2
APPENDICES
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I. Form of Charter Assignment
II. Form of Collateral Agreement
III. Form of Contract Assignment
IV. Form of Deed of Charge
V. Form of General Assignment
VI. Form of Guarantee and Swap Receipts Assignment
VII. Form of Management Contracts Assignment
VIII. Form of Mortgage
Page 3
THIS AGREEMENT is made as of the 26th day of November One thousand nine hundred
and ninety-seven
BETWEEN:
(1) FARAWAY MARITIME SHIPPING COMPANY, as borrower;
(2) BANK OF TAIWAN, as lead arranger;
(3) CREDIT AGRICOLE INDOSUEZ, THE FUJI BANK, LIMITED and THE INDUSTRIAL BANK OF
JAPAN, LIMITED, as arrangers;
(4) CREDIT LYONNAIS, OFFSHORE BANKING UNIT, TAIPEI, as senior manager;
(5) THE BANKS AND FINANCIAL INSTITUTIONS referred to in Schedule 1, as lenders;
and
(6) INDOSUEZ ASIA SHIPFINANCE SERVICES LIMITED, as agent and security trustee.
BY WHICH IT IS AGREED as follows:
1. PURPOSE AND DEFINITIONS
1.01 This Agreement sets out the terms and conditions upon and subject to
which the Lenders agree to make available to the Borrower a secured
loan of up to Dollars Two hundred and fourteen million five hundred
thousand ($214,500,000) or (subject as provided in Clause 2.01(b))
such lesser amount as represents seventy eight per centum (78%) of the
Total Project Cost to be used for the purpose of assisting the
Borrower in financing its acquisition of the Vessel (as such
capitalised terms are defined below).
1.02 In this Agreement, unless the context otherwise requires:
"Additional Swap Agreements" means each interest rate exchange
agreement approved by the Agent made or to be made between the
Borrower and any party who is not a Counterparty on terms whereby the
Borrower agrees to pay a fixed amount of interest on 28th June and/or
28 December of any year, and includes any renewal, replacement,
substitute or addendum to such agreement made from time to time;
"Advance" means each borrowing of a portion of the Commitment in
respect of the Contract Price Tranche or the Fees and Development
Costs Tranche by the Borrower or (as the context may require) the
principal amount of such borrowing for the time being outstanding;
Page 4
"Affiliate" means of any person means any other person which, directly
or indirectly, controls or is controlled by or is under common control
with such person; for the purposes of this definition "control" when
used with respect to any specified person means the power to direct
the management and policies of such person, directly or indirectly,
whether through ownership of voting securities, by contract or
otherwise, and the terms "controlling" and "controlled" have meanings
correlative to the foregoing;
"Agent" means Indosuez Asia Shipfinance Services Limited, a company
incorporated under the laws of Hong Kong, having its registered office
at ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇ or such other person as may be appointed as agent and security
trustee for the Lenders pursuant to the Security Sharing Agreement;
"Arrangers" means Credit Agricole Indosuez, The Fuji Bank, Limited and
The Industrial Bank of Japan, Limited, being three of the Lenders
under this Agreement and arrangers of this facility, and references to
"the Arrangers" shall be construed as including the Lead Arranger;
"Assignee" has the meaning ascribed thereto in Clause 14.03;
"Bank Guarantee" means the bank guarantee issued or to be issued by a
Bank Guarantor in favour of the Borrower pursuant to Section 13.3 of
the Contract, in the form annexed as Appendix 3 to the Contract;
"Bank Guarantor" means each first-class European, American, Japanese,
Hong Kong or Taiwanese bank or group of banks to issue a Bank
Guarantee in accordance with the terms of the Contract;
"Banking Day" means, a day (excluding Saturday) on which dealings in
deposits in Dollars are carried on in the London interbank market and
(if payment is required to be made on such day) on which banks are
open for business in London, New York, Paris, Singapore, Tokyo, Taipei
and Hong Kong and any other relevant place of payment under Clause 6
and in respect of notices, requests, demands and other communications
under Clause 16.01, means a day on which banks are open for business
in the country of the addressee;
"Borrowed Money" means Indebtedness incurred in respect of (i) money
borrowed or raised, (ii) any bond, note, loan stock, debenture or
similar instrument, (iii) acceptance or documentary credit facilities,
(iv) deferred payments for assets or services acquired, (v) rental
payments under leases (whether in respect of land, machinery,
equipment or otherwise) entered into primarily as a method of raising
finance or of financing the acquisition of the asset leased, (vi)
guarantees, bonds, stand-by letters of credit or other instruments
issued in connection with the performance of contracts and (vii)
guarantees or other assurances against financial loss in respect of
Indebtedness of any person falling within any of paragraphs (i) to
(vi) above;
Page 5
"Borrower" means FARAWAY MARITIME SHIPPING COMPANY, a company
incorporated under the laws of the Republic of Liberia, having its
registered office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇;
"Builder" means Mitsubishi Heavy Industries, Ltd., of Japan;
"Cash Available" means, in respect of each repayment period, the
aggregate of (i) the Owner's Cost Component, and (ii) a portion of the
Operating Cost Component equal to the amount of Taxes (as that term is
defined in the Collateral Agreement) deducted from the Owner's Cost
Component, actually received by the Borrower during that repayment
period;
"Chargors" means together CPC, Oxbow and Golar Maritime, and "Chargor"
means each or any one of them as the context may require;
"Charter" means the time charterparty dated 2nd July 1997 a certified
true copy of which has been provided to the Agent, entered into
between the Borrower and the Charterer for the Vessel to be on hire to
the Charterer throughout the Loan Period at a rate of charterhire
sufficient to enable the Borrower to meet its obligations under this
Agreement and the Security Documents and the operating expenses of the
Vessel;
"Charter Assignment" means the assignment of the Charter to be made
between the Borrower and the Agent (in its capacity as security
trustee for and on behalf of the Counterparties and the Lenders) as
security for the Borrower's obligations under this Agreement, being in
the form attached as Appendix I hereto;
"Charterer" means Perusahaan Pertambangan Minyak ▇▇▇ Gas Bumi Negara
(Pertamina), a state enterprise of the Republic of Indonesia having an
office at Gedung ▇▇▇▇▇, Second Floor, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇;
"Charterer's Consent" means the consent of the Charterer to the
Charter Assignment and certain of the other Security Documents in the
form attached as Schedule 2 to the Charter Assignment;
"Collateral Agreement" means the agreement made or to be made between
the Borrower, the Trustee, the Lenders and the Agent governing the
accounts for the receipt and application of charterhire and other
earnings of the Vessel, being in the form attached as Appendix II
hereto;
"Commitment" means in relation to each Lender the amount set opposite
its name in Schedule 1, being the amount which such Lender will make
available to the Borrower hereunder, and in relation to the Lenders
together means the aggregate thereof, in each case as reduced by any
relevant term of this Agreement;
Page 6
"Contract" means the shipbuilding and sales contract dated 14th June
1997, together with all assignments, amendments, modifications,
supplements and addenda thereto from time to time, and made between
the Contractor of the one part and the Borrower of the second part,
with the consent and agreement of the Builder whereby the Contractor
and the Builder have agreed to build, launch, complete and deliver the
Vessel to the Borrower, a certified true copy of which has been
delivered to the Agent;
"Contract Assignment" means the assignment of the Contract to be made
between the Borrower and the Agent (in its capacity as security
trustee for and on behalf of the Counterparties and the Lenders) as
security for the Borrower's obligations under this Agreement, being in
the form attached as Appendix III hereto;
"Contract Price" means the total price payable by the Borrower to the
Contractor for the Vessel under the Contract, namely Dollars Two
hundred and thirty five million ($235,000,000);
"Contract Price Tranche" means that part of each Lender's Commitment
or Contribution which is available or has been drawn down to meet the
whole or part of an instalment of the Contract Price under Clause
2.04;
"Contractor" means Mitsubishi Corporation (Hong Kong) Ltd., of Hong
Kong;
"Contribution" means the principal amount of the Loan owing to a
Lender at any relevant time;
"Counterparties" means any of (i) the Lenders, and/or (ii) any
subsidiary or holding company of a Lender which is approved in writing
by the Agent acting on the instructions of the Arrangers, as the case
may be, which enters into a Swap Agreement with the Borrower;
"CPC" means Chinese Petroleum Corporation, a company incorporated
under the laws of the Republic of China, having its principal office
at ▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇;
"Debt/Equity Ratio" means at any relevant time the ratio of (i) the
aggregate amount drawn down by the Borrower under this Agreement
against (ii) the aggregate amount of paid capital and subordinated
shareholders loan made available to the Borrower by the Chargors;
"Debt Service Reserve" has the meaning ascribed to it in the
Collateral Agreement;
"Deed of Charge" means the deed of charge whereby the whole of the
issued and outstanding share capital of the Borrower is charged in
favour of the Agent (in its capacity as security trustee for and on
behalf of the Counterparties and the Lenders) to be made between the
Chargors and the Agent as security for the Borrower's obligations
under this Agreement, being in the form attached as Appendix IV
hereto;
Page 7
"Deed of Guarantee" means the performance guarantee issued by Osprey
Maritime Limited in favour of the Charterer, in the form annexed as
Exhibit B to the Charter;
"Default" means any Event of Default or any event 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 Date" means the date, being a Banking Day, on which the
Vessel is delivered to, and accepted by, the Borrower under the
Contract;
"Development Costs" means all costs in relation to the construction
and outfitting of the Vessel including but not limited to consultancy
and legal services, administration, plan approval, supervision,
initial stores, positioning costs and spares;
"Dollars" and "$" mean the lawful currency at any relevant time
hereunder of the United States of America and in respect of all
payments to be made under this Agreement or any of the other Security
Documents mean funds which are for same day settlement in the New York
Clearing House Interbank Payments System (or such other U.S. dollar
funds as may at the relevant time be customary for the settlement of
international banking transactions denominated in U.S. dollars);
"Drawdown Date" means, in respect of each Advance, the date being a
Banking Day during the Drawdown Period, on which such Advance is or is
to be advanced;
"Drawdown Notice" means a notice substantially in the terms of
Schedule 2;
"Drawdown Period" means the period from the date of this Agreement and
ending on 31st December 2000 or the period ending on such earlier date
(if any) (i) which is the Delivery Date or (ii) on which the aggregate
of all Advances is equal to the total of the Commitment or (iii) on
which the Commitment is reduced to zero pursuant to Clause 10.02 or
12;
"Earnings Account" has the meaning ascribed to such term in the
Collateral Agreement;
"Encumbrance" means any mortgage, charge (whether fixed or floating),
pledge, lien (save for those arising in the normal course of
business), hypothecation, assignment, security interest or other
encumbrance of any kind securing or any right conferring a priority of
payment in respect of any obligation of any person;
"Event of Default" means any of the events or circumstances described
in Clause 10.01;
"Fee Letter" means the letter agreement made or to be made between the
Borrower and the Agent relating to the Lenders' and the Arrangers'
management fee and an annual agency fee;
"Fees and Development Costs Tranche" means that part of each Lender's
Commitment and/or Contribution which is available for, or is drawn
down to make, payment of:
Page 8
(i) Development Costs pursuant to the terms of Clause 2.04(b)(i); and
(ii) interest, commitment fees, trustee fees, management fees and
agency fees prior to the Delivery Date pursuant to the terms of
Clause 2.05(b),
not exceeding in aggregate Dollars Thirty one million two hundred
thousand ($31,200,000);
"Final Fees and Development Costs Amount" means an amount comprising:
(i) expenses, approved by the Agent against presentation of invoices
and/or receipts, in respect of permissible Development Costs; and
(ii) a further amount to fund interest, commitment fees, management
fees, agency fees and trustee fees unpaid at the Delivery Date in
respect of the period commencing on the last Interest Payment
Date before the Delivery Date and ending on the Funded Amounts
Date,
calculated by the Agent so that the aggregate of the Final Fees and
Development Costs Amount and all Advances made at any time under
Clause 2.04(a) and Clause 2.04(b) does not exceed the lesser of (a)
Dollars Two hundred and fourteen million five hundred thousand
($214,500,000), and (b) seventy eight per centum (78%) of the Total
Project Cost;
"Final Maturity Date" means 28th June 2013;
"First Hire Payment Date" has the meaning ascribed to such term in
section 1.20 of the Charter;
"First Repayment Date" means 28th June 2001;
"Floating Rate" means the rate of interest for the time being
chargeable on the Loan, determined in accordance with Clause 3.02;
"Funded Amounts Date" means the date notified by the Borrower to the
Agent, in the Drawdown Notice relating to the final instalment of the
Contract Price Tranche, being a date not more then ten (10) days after
the Delivery Date which the Borrower anticipates will be the First
Hire Payment Date;
"General Assignment" means the assignment of all insurances,
requisition compensation and earnings (excluding charterhire) relating
to the Vessel to be made between the Borrower and the Agent (in its
capacity as security trustee for and on behalf of the Counterparties
and the Lenders) as security for the Borrower's obligations under this
Agreement, being in the form attached as Appendix V hereto;
"GLIL" means ▇▇▇▇▇▇ - ▇▇▇▇▇▇ International Ltd., of ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇;
"Golar Maritime" means Golar Maritime (Asia) Inc., a company
incorporated under the laws of the Republic of Liberia, having its
registered office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇;
Page 9
"Good Management Undertaking" means the letter of undertaking of even
date herewith between Golar Gas Holding Company Inc. and the Agent
relating to the obligations of GLIL under the Sub-management
Agreement;
"Guarantee and Swap Receipts Assignment" means the assignment of the
Bank Guarantee, the Performance Bond and the Refund Guarantees and of
the moneys payable to the Borrower under the Swap Agreement to be made
between the Borrower and the Agent (in its capacity as security
trustee for and on behalf of the Counterparties and the Lenders) as
security for the Borrower's obligations under this Agreement, being in
the form attached as Appendix VI hereto;
"Indebtedness" means any obligation for the payment or repayment of
money, whether as principal or as surety and whether present or
future, actual or contingent, primary or collateral, several or joint,
secured or unsecured;
"Indonesian Taxes" has the meaning ascribed to such term in section
1.30 of the Charter;
"Information Memorandum" means the information memorandum dated
November 1997, describing, amongst other matters, the Relevant
Documents and the Vessel, the transactions contemplated by this
Agreement and other related matters;
"Interest Payment Date" means the last day of each Interest Period;
"Interest Period" means in relation to each Advance and the Loan each
period for the calculation of interest in respect of such Advance or
the Loan ascertained in accordance with Clauses 3.02 and 3.03, but
subject to Clause 12.03;
"Lead Arranger" means Bank of Taiwan, being one of the Lenders under
this Agreement and the lead arranger of this facility;
"Lenders" means the banks and other financial institution or their
associates listed in Schedule 1 (including any other branch or office
through which each such Lender may be acting from time to time
pursuant to Clause 14.06) and includes the successors in title,
Assignees and Transferees of the Lenders or any or each of them, as
the case may be, and "Lender" means any of them as the context may
require;
"Letters of Undertaking" means the letters of undertaking bearing even
date with this Agreement written by parties approved by the Agent and
addressed to the Agent, certified copies of which have been given to
each of the Lenders and "Letter of Undertaking" means each and any of
them;
"Libor" means, in relation to a particular period, the arithmetic mean
(rounded upward if necessary to five decimal places) of the London
Interbank offered rate for Dollar deposits for a period equal to such
period at or about 11 a.m. (London time) on the second Banking Day
before the first day of such period as displayed on the page 3750 on
the Telerate screen (or such other page as may from time to time
replace such page for the purpose of displaying London Interbank
offered rates of major banks for Dollar deposits), provided that if on
such date the offered rates of less than two banks are so displayed,
Libor for such period shall be the arithmetic mean (rounded upwards as
aforesaid) of the rates respectively quoted to the Agent by each of
the Lead Arranger and the Arrangers at the request of the Agent as
such Arranger's offered rate for Dollar deposits in an amount
approximately equal to the amount in relation to which Libor is to be
determined for a period equivalent to such period to prime banks in
the London Interbank Market at or about 11 a.m. (London time) on the
second Banking Day before the first day of such period;
Page 10
"Loan" means the aggregate principal amount owing to the Lenders under
this Agreement at any relevant time;
"Loan Period" means the period from the date of this Agreement to the
date upon which all moneys owing by the Borrower to the Lenders and/or
the Agent under or pursuant to this Agreement and the Security
Documents are paid in full;
"Majority Lenders" means Lenders, the aggregate of whose Contributions
equals or exceeds seventy five per centum (75.0%) of the Loan or,
prior to drawdown of the Loan, the aggregate of whose Commitments
equals or exceeds seventy five per centum (75.0%) of the total
Commitments of all the Lenders;
"Management Agreement" means the ship management agreement made or to
be made between the Borrower and the Manager pursuant to which the
Manager is appointed to provide technical management of the Vessel, a
certified true copy of which has been delivered to the Agent;
"Management Contracts Assignment" means the assignment of the
Management Agreement and the Sub-Management Agreement to be executed
by the Borrower and the Manager in favour of the Agent (in its
capacity as security trustee for and on behalf of the Counterparties
and the Lenders) as security for the Borrower's obligations under this
Agreement, being in the form attached as Appendix VII hereto;
"Manager" means Aurora Management Inc. of ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ of Liberia and includes any replacement manager appointed
with the approval of the Agent (such approval not to be unreasonably
withheld);
"Margin" means from the date of drawdown of the first Advance
hereunder until the Delivery Date, nought point four two five per
centum (0.425%) per annum and thereafter, nought point eight six five
per centum (0.865%) per annum;
"month" means a period beginning in one calendar month and ending in
the next calendar month on the day numerically corresponding to the
day of the calendar month on which it started Provided that (i) if the
period started on the last Banking Day in a calendar month or if there
is no such numerically corresponding day, it shall end on the last
Banking Day in such next calendar month and (ii) if such numerically
corresponding day is not a Banking Day, the period shall end on the
next following Banking Day in the same calendar month but if there is
no such Banking Day it shall end on the preceding Banking Day and
"months" and "monthly" shall be construed accordingly;
"Mortgage" means the first preferred Liberian ship mortgage of the
Vessel to be executed by the Borrower in favour of the Agent (acting
in its capacity as security trustee for and on behalf of the
Counterparties and the Lenders) as security for the Borrower's
obligations under this Agreement, being in the form attached as
Appendix VIII hereto;
"Net Interest" means, in respect of any Interest Payment Date:
(a) the aggregate of (i) the interest payable by the Borrower under
this Agreement and (ii) any amounts payable by the Borrower under
each Swap Agreement and Additional Swap Agreement;
less
(b) amounts receivable by the Borrower under each Swap Agreement and
Additional Swap Agreement,
in each case on the relevant Interest Payment Date;
"Outstanding Indebtedness" means the aggregate of the Loan and
interest accrued and accruing thereon, all commitment and other fees
accrued and accruing hereunder and all other sums of money from time
to time owing by the Borrower to the Lenders, or any of them, actually
or contingently, under this Agreement and the Security Documents, or
any of them;
Page 11
"overall control" means in relation to any company:
(a) having the power, exercisable without the consent or concurrence
of any other person, to appoint or remove all or the majority of
the directors of the company, provided nobody else has such
power; or
(b) owning or controlling more than half of the issued share capital
of the company; or
(c) owning or controlling more than half of the voting power of the
company;
"Owner's Cost Component" has the meaning ascribed to such term in
section 1.40 of the Charter;
"Oxbow" means Oxbow Holdings Inc., a corporation incorporated under
the laws of the British Virgin Islands, having its registered office
at Drake Chambers, Tortola, British Virgin Islands;
"Performance Bond" means the performance bond dated 13th June 1997
executed by The Tokai Bank, Ltd. in favour of the Borrower in respect
of the Builder's obligations under the Contract, in the form annexed
as Appendix I to the Contract;
"Permitted Encumbrance" means any Encumbrance created pursuant to the
Security Documents or permitted to exist pursuant to the terms of this
Agreement or the Security Documents;
"Receiver" means any receiver, manager or similar officer appointed by
the Agent in respect of the security granted under the Security
Documents;
"Receiving Bank" means Credit Agricole Indosuez, Hong Kong branch,
42nd - 45th Floor, One Exchange Square, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇;
"Refund Guarantees" means the refund guarantees executed or to be
executed by the Bank Guarantors in favour of the Borrower pursuant to
the Contract in the form annexed as Appendix II to the Contract and
"Refund Guarantee" means each or any one of them;
"Related Company" of a person means any Subsidiary of such person, any
company of which such person is a Subsidiary and any Subsidiary of any
such company;
"Relevant Documents" means together the Bank Guarantee, the Charter,
the Contract, the Shareholders Agreement, the Management Agreement,
the Performance Bond, the Refund Guarantees, the Performance
Guarantee, the Sub-management Agreement, the Sales Contract, the
Trustee and Paying Agent Agreement, the Security Sharing Agreement and
each of the Security Documents and "Relevant Document" means each or
any one of them as the context may require;
"Repayment Dates" means, subject to Clause 6.04, the First Repayment
Date and each of the subsequent dates set out in Schedule 4;
"Sales Contract" means the contract dated 25th October 1995 made
between the Charterer and CPC for the sale and purchase of liquefied
natural gas, described in the Charter, a certified true copy of which
has been delivered to the Agent;
"Scheduled Delivery Date" has the meaning ascribed to it in section
1.46 of the Charter;
"Security Documents" includes (i) the Charter Assignment, (ii) the
Charterer's Consent, (iii) the Collateral Agreement, (iv) the Letters
of Undertaking, (v) the Contract Assignment, (vi) the Deed of Charge,
(vii) the General Assignment, (viii) the Management Contracts
Assignment, (ix) the Mortgage, (x) the Guarantee and Swap Receipts
Assignment, (xi) the Swap Agreement, (xii) the Good Management
Undertaking (xiii) the Security Sharing Agreement and (xiv) any such
other documents as may have been or shall from time to time hereafter
be executed to secure the Loan, the Swap Debt, interest and all other
moneys from time to time owing (whether the same shall be due and
payable or not) by the Borrower pursuant to this Agreement, the Swap
Agreements and/or to all or any of such documents;
Page 12
"Security Sharing Agreement" means the security sharing agreement (if
any), to be entered into before the first Advance is made pursuant to
this Agreement, among the Lenders, the Borrower, the Counterparties,
the Agent and any other party approved by the Agent relating to the
security granted to secure the Borrower's obligations under this
Agreement together with all assignments, amendments, modifications,
supplements and addenda thereto from time to time;
"Shareholders Agreement" means the agreement dated 14th June 1997 made
between the Chargors with respect to the regulation of the affairs of
the Borrower, a certified true copy of which has been given to the
Agent;
"Sub-management Agreement" means the sub-contract agreement made or to
be made between the Manager and the Sub-manager pursuant to which the
Sub-manager will provide technical management for the operation of the
Vessel, a certified true copy of which has been delivered to the
Agent;
"Sub-manager" means GLIL as sub-contractor of the Manager under the
Sub-management Agreement and includes any replacement sub-contractor
appointed with the approval of the Agent (such approval not to be
unreasonably withheld);
"Subsidiary" of a person means any company or entity directly or
indirectly controlled by such person for which purpose "control" means
either ownership of more than fifty per centum (50%) of the voting
share capital (or equivalent right of ownership) of such company or
entity or power to direct its policies and management whether by
contract or otherwise;
"Swap Agreement" means the interest rate exchange agreement, or
interest rate exchange agreements, as the case may be, made or to be
made within thirty (30) days of the date of this Agreement in each
case between the Borrower and one or more of the Counterparties
whereby each Counterparty will provide to the Borrower an interest
rate swap facility to limit the Borrower's exposure to adverse
movements in interest rates, and any renewal, replacement, substitute
of or addendum to such agreement from time to time made with the
approval of the Agent and "Swap Agreements" means any and all of them
as the context may require;
"Swap Debt" means, in relation to the Borrower, all termination sums
and other amounts payable by the Borrower from time to time under or
in connection with each Swap Agreement;
"Taxes" includes all present and future taxes, levies, imposts,
duties, fees or charges of whatever nature together with interest
thereon and penalties in respect thereof and "Taxation" shall be
construed accordingly;
"Total Loss" means actual or constructive or compromised or arranged
total loss of the Vessel, requisition for title or other compulsory
acquisition of the Vessel (otherwise than by requisition for hire) or
capture, seizure, arrest, detention or confiscation of the Vessel by
any government or by persons acting or purporting to act on behalf of
any government unless the Vessel be released and restored to the
Borrower from such capture, seizure, arrest, detention or confiscation
within one (1) month after the occurrence thereof;
"Total Project Cost" means the aggregate of (a) the Contract Price of
the Vessel, (b) interest accrued on Advances made prior to the
Delivery Date, (c) the Development Costs (d) interest accrued on the
Loan for the period commencing on (and including) the Delivery Date
and ending on the Funded Amounts Date and (e) commitment and other
fees payable to the Lenders and/or the Agent and/or the Trustee under
or pursuant to this Agreement, each as conclusively determined by the
Agent immediately before the Delivery Date;
Page 13
"Transfer Certificate" means a certificate substantially in the terms
of Schedule 5;
"Transferee" has the meaning ascribed thereto in Clause 14.03;
"Trustee" means The Industrial Bank of Japan Trust Company of ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇;
"Trustee and Paying Agent Agreement" means the trustee and paying
agent agreement dated 4th March 1997 made between inter alia the
Charterer and Bank of America National Trust and Savings Association,
New York Branch, as trustee and paying agent pursuant to inter alia
the Sales Contract, a certified true copy of which has been delivered
to the Agent;
"Trustee Fee Letter" means the letter agreement made or to be made
between the Borrower and the Trustee relating to an annual Trustee
fee;
"Vessel" means the 135,000 m3 loading capacity liquefied natural gas
carrier presently under construction under the Contract having
Builder's Hull No. 2148 and which on delivery will be registered in
the ownership of the Borrower under the laws and flag of the Republic
of Liberia.
1.03 Clause headings and the table of contents are inserted for convenience
of reference only and shall be ignored in the interpretation of this
Agreement.
1.04 In this Agreement and the Security Documents an event, circumstance or
situation will be deemed to be "material" if:
(a) in relation to a matter to which a monetary value can be
attached, it has a value or potential value if realised in
respect of any single item in excess of Dollars Three hundred
thousand ($300,000) and in relation to all such matters at any
one time in excess in aggregate of Dollars Two million
($2,000,000);
(b) in relation to all matters (whether financial or otherwise), it
is of such a nature that the directors of the Borrower, acting
honestly and reasonably, if they were to consider the effect or
potential effect of such matter would draw the conclusion either
(i) that it would have, or potentially would have, an adverse
effect on the ability of the Borrower or any other party (other
than the Lenders or the Agent) to any of the Relevant Documents
to perform its respective obligations thereunder as they fall due
or (ii) that it is a matter of which a prudent lender in a
facility of this nature would wish to be aware and, if aware,
would hold the opinion expressed in sub-paragraph (c) below;
(c) in relation to a matter of which the Agent and/or the Lenders are
aware, is of such nature that the Majority Lenders in their
reasonable opinion consider to be material and advise the Agent
accordingly.
1.05 In this Agreement, unless the context otherwise requires:
(a) references to Clauses and Schedules are to be construed as
references to clauses of, and schedules to, this Agreement and
references to this Agreement include its Schedules;
(b) references to (or to any specified provision of) this Agreement
or any other document shall be construed as references to this
Agreement, that provision or that document as in force for the
time being and as amended in accordance with terms thereof, or,
as the case may be, with the agreement of the relevant parties
and (where such consent is by the terms of this Agreement or the
relevant document, required to be obtained as a condition to such
amendment being permitted) the prior written consent of the
Agent;
Page 14
(c) references to any enactment shall be deemed to include references
to such enactment as re-enacted, amended, extended, consolidated
or replaced, and any orders decrees, proclamations, regulations,
instruments or other subordinate legislation made thereunder;
(d) words importing the plural shall include the singular and vice
versa; and
(e) references to a person shall be construed as references to an
individual, firm, company, corporation, unincorporated body of
persons or any State or any agency thereof.
2. THE FACILITY
2.01 (a) The Lenders, relying upon each of the representations and
warranties in Clause 7, agree to lend to the Borrower upon and
subject to the terms of this Agreement, the principal sum of up
to Dollars Two hundred and fourteen million five hundred thousand
($214,500,000) or (subject to paragraph (b) below) such lesser
sum as is equal to seventy eight per centum (78%) of the Total
Project Cost as agreed between the Borrower and the Agent by
reference to budgeted expenses approved from time to time by the
Agent and incurred by the Borrower up to delivery of the Vessel
on hire under the Charter.
(b) In the event that seventy eight per centum (78%) of the Total
Project Cost is less than Dollars Two hundred and fourteen
million five hundred thousand ($214,500,000), the Lenders,
relying upon each of the representations and warranties in Clause
7, grant to the Borrower the option to require the Lenders to
lend to the Borrower, on the Delivery Date and upon and subject
to the terms of this Agreement, a further principal sum in an
amount equal to the difference between:
(i) Dollars Two hundred and fourteen million five hundred
thousand ($214,500,000); and
(ii) seventy eight per centum (78%) of the Total Project Cost,
provided that the Borrower shall, immediately upon drawdown of
any amount made available by the Lenders under this Clause
2.01(b), pay such amount to the Earnings Account, and instruct
the Trustee to transfer such amounts to the Collateral Account
(as defined in the Collateral Agreement) to be applied to
establish the Debt Service Reserve.
2.02 The obligations of each Lender under this Agreement shall be to
contribute to each Advance that proportion of each Advance which its
Commitment represents of the total Commitments of all of the Lenders.
2.03 The obligations of each Lender under this Agreement are several. The
failure of any Lender to perform its obligations under this Agreement
shall not relieve the other Lenders or the Agent or the Borrower of
any of their respective obligations or liabilities under this
Agreement nor shall the Agent or any Lender be responsible for the
obligations of any other Lender under this Agreement. However, in the
event that the Borrower suffers any loss or damage due to any Lender's
failure other than as expressly provided for in this Agreement, that
Lender shall indemnify the Borrower for such loss or damage.
2.04 Subject to the terms of this Agreement, the Borrower may drawdown the
Commitment by Advances in Dollars in the following manner:
(a) up to four (4) Advances, comprising the Contract Price Tranche,
may be drawndown as follows:
(i) the first (1st) Advance shall be in an amount equal to
Dollars Twenty three million five hundred thousand
($23,500,000) on or after the Banking Day upon which the
second (2nd) instalment of the Contract Price is due and
payable to the Contractor under Section 8.2(b) of the
Contract;
Page 15
(ii) the second (2nd) Advance shall be in an amount equal to
Dollars Forty seven million ($47,000,000) on or after the
Banking Day upon which the third (3rd) instalment of the
Contract Price is due and payable to the Contractor under
Section 8.2(c) of the Contract;
(iii) the third (3rd) Advance shall be in an amount equal to
Dollars Forty seven million ($47,000,000) on or after the
Banking Day upon which the fourth (4th) instalment of the
Contract Price is due and payable to the Contractor under
Section 8.2(d) of the Contract; and
(iv) the fourth (4th) and final Advance shall be made on the
Delivery Date and shall be in an amount equal to the
aggregate of (1) the final instalment of the Contract Price
due and payable to the Contractor under Section 8.2(e) of
the Contract, and (2) the Final Fees and Development Costs
Amount;
(b) by Advances, comprising the Fees and Development Costs Tranche,
which will be available for drawdown:
(i) in respect of Advances intended to fund permissible
Development Costs, in amounts of no less than Dollars One
million ($1,000,000) available for drawdown on the
twenty-eighth (28th) day of March, June, September and
December during the Drawdown Period (save for the Delivery
Date) against presentation to the Agent of invoices and/or
receipts in respect of permissible Development Costs; and
(ii) in respect of Advances intended to fund payment of
interest, commitment fees, management fees, agency fees and
trustee fees prior to the Delivery Date, in accordance with
Clause 2.05(b),
subjectin each case to the Agent being satisfied that, upon making
the relevant Advance, the Debt/Equity Ratio will not exceed 78:22;
(c) by an Advance, comprising the funds made available for
drawdown on the Delivery Date in accordance with Clause
2.01(b), subject to the Agent being satisfied that, upon
making that Advance and any other Advance being made at
that time, the Loan will not exceed Dollars Two hundred and
fourteen million five hundred thousand ($214,500,000).
2.05 (a) Subject to the terms and conditions of this Agreement, an Advance
shall be made to the Borrower during the Drawdown Period
following receipt by the Agent from the Borrower of a Drawdown
Notice no later than 10:00 am (Hong Kong time) on the fifth (5th)
Banking Day before the date on which the Advance is intended to
be made. A Drawdown Notice shall be effective on actual receipt
by the Agent and, once given, shall, subject as provided in
Clause 12.03(a), be irrevocable.
(b) Unless otherwise agreed between the parties, during the Drawdown
Period the Agent shall give notice to the Borrower six (6)
Banking Days before each Interest Payment Date and each due date
for payment of interest, commitment fees, agency fees and other
expenses under Clause 5, of the sum so falling due. The Borrower
may, at any time following receipt of such a notice from the
Agent but not later than three (3) Banking Days before the due
date for the sum falling due, agree with the Agent an adjustment
to the relevant amount specified in the notice. Whether or not
the Agent and the Borrower shall have agreed an adjustment to the
amount specified in the notice, the Borrower shall be deemed to
have given, and the Agent shall have been deemed to have
received, a Drawdown Notice in respect of the amount specified in
the notice (or such other amount agreed between the Agent and the
Borrower in accordance with the preceding sentence) for an
Advance in an amount equal to, and for the purpose of payment of,
such interest, commitment fees, agency fees or other expenses so
falling due.
Page 16
2.06 Upon receipt of each Drawdown Notice complying with the terms of this
Agreement the Agent shall notify the Lenders thereof and of the
proposed Drawdown Date specified therein and, subject to the
provisions of Clause 9, the Lenders shall make their respective
Commitments to the relevant Advance available to the Agent in
accordance with Clause 6.02.
2.07 If any part of the Commitment is not drawn down on the last day of the
Drawdown Period, the Lenders' obligation to make any further Advance
shall terminate on such day and shall be cancelled.
2.08 The Borrower shall have the right, not earlier than six months before
the Scheduled Delivery Date (as adjusted in accordance with the terms
of the Charter), upon giving the Agent not less than ten (10) Banking
Days prior written notice, to cancel without penalty not more than
Dollars Twelve million ($12,000,000) of the Commitment in respect of
the Fees and Development Costs Tranche undrawn at the date of such
notice.
3. INTEREST AND INTEREST PERIODS
3.01 The Borrower shall pay interest on each Advance and the Loan in
respect of each Interest Period relating thereto on each Interest
Payment Date for the period from the date on which such Advance was
drawn down or (as the case may be) for the period from the immediately
preceding Interest Payment Date at the relevant Floating Rate for the
time being.
3.02 The Floating Rate in respect of each Advance and the Loan shall be,
for each Interest Period relative thereto, but subject to Clause 3.04
(in respect of overdue amounts) and Clause 12.03, the annual rate of
interest which is conclusively (save for manifest error) certified by
the Agent to the Borrower to be the aggregate of (i) the Margin, and
(ii) Libor for a period equal to and for value on the first day of the
relevant Interest Period were being offered to first class banks in
the London interbank eurocurrency market at or about 11:00 a.m.
(London time) on the second (2nd) Banking Day before the first (1st)
day of such Interest Period.
3.03 Each Interest Period shall have a duration of six (6) months (or such
longer or shorter period as may be agreed between the Borrower and the
Lenders) provided always that:
(a) the first Interest Period in respect of the first Advance shall
commence on the date on which such Advance is made and shall end
on 28th June or 28th December of the current year, whichever is
the next to occur;
(b) each subsequent Interest Period shall commence forthwith upon the
expiry of the previous Interest Period and shall end six (6)
calendar months later on which is the next to occur of 28th June
or 28th December;
(c) the first Interest Period for each Advance after the first
Advance shall expire on the same day as the current Interest
Period for the Loan; and
(d) all interest Periods shall end on the Final Maturity Date.
3.04 If the Borrower fails to pay any sum (including, without limitation,
any sum payable pursuant to this Clause 3.04) on its due date for
payment under this Agreement or any of the Security Documents the
Borrower shall pay interest on such sum on demand from the due date up
to the date of actual payment (as well after as before judgment) at a
rate determined by the Agent to be two per centum (2%) per annum above
the Floating Rate for such period not exceeding six (6) months as the
Agent may determine from time to time in amounts comparable with the
sum not paid. Such interest shall be due and payable on the last day
of each period as determined by the Agent and each such date shall,
for the purposes of this Agreement, be treated as an Interest Payment
Date. Provided that if such sum is of principal which became due and
payable on a date other than an Interest Payment Date relating
thereto, the first such period selected by the Agent shall be of a
duration equal to the period between the due date of such principal
sum and such Interest Payment Date and interest shall be payable on
such principal sum during such period at a rate two per centum (2%)
above the rate applicable thereto immediately before it fell due. If,
for the reasons specified in Clause 12.03 (a) (i), the Agent is unable
to determine a rate in accordance with the foregoing provisions of
this Clause 3.04, interest shall be calculated at a rate determined by
the Agent to be two per centum (2%) per annum above the aggregate of
the Margin and the cost of funds to the Lenders.
Page 17
3.05 The Agent shall notify the Borrower and the Lenders promptly of each
rate of interest determined by it under this Clause 3. The certificate
of the Agent as to any rate of interest determined by it (after
consultation with the Lenders) pursuant to this Agreement shall in the
absence of manifest error, be conclusive and binding on the Borrower
and the Lenders.
4. REPAYMENT AND PREPAYMENT
4.01 The Borrower shall repay the Loan together with accrued interest
thereon calculated in accordance with Clause 3 on the dates and in the
amounts set out in Schedule 4 PROVIDED ALWAYS the Outstanding
Indebtedness (if any) then remaining shall be repaid in full on the
Final Maturity Date.
4.02 The Borrower may prepay the Loan in whole or part (being Dollars One
million ($1,000,000) or any larger sum which is an integral multiple
of Dollars One million ($1,000,000)) on any date following the
Delivery Date together with accrued interest to the date of prepayment
and any other sum then payable under this Agreement and/or the
Security Documents (or any of them), provided that the Agent shall
have received from the Borrower not less than thirty (30) days' notice
of its intention to make such prepayment, specifying the amount to be
prepaid and the date of prepayment.
4.03 The Borrower shall prepay the Loan, together with accrued interest to
the date of prepayment, and all other sums payable by the Borrower
pursuant to this Agreement and/or the Security Documents (or any of
them), including, without limitation, any amounts payable under Clause
11 within one hundred and twenty (120) days of the Vessel becoming a
Total Loss and for the purpose of this Agreement:
(a) an actual total loss of the Vessel shall be deemed to have
occurred at the actual date and time the Vessel was lost but in
the event of the date of the loss being unknown then the actual
total loss shall be deemed to have occurred on the date on which
the Vessel was last reported; and
(b) a constructive total loss shall be deemed to have occurred at the
date and time notice of abandonment of the Vessel is given to the
insurers of the Vessel for the time being (provided a claim for
total loss is admitted by such insurers) or, if such insurers do
not admit such a claim, at the date and time at which a total
loss is subsequently adjudged by a competent court of law to have
occurred.
4.04 Every notice of prepayment shall be effective only on actual receipt
by the Agent, shall, once given, be irrevocable and shall oblige the
Borrower to make such prepayment on the date specified. No amount of
the Loan prepaid may be re-borrowed and any amount prepaid pursuant to
Clause 4.02 shall be applied in reducing the repayment instalments
under Clause 4.01 in inverse order of their due dates for payment. The
Borrower may not prepay the Loan or any part thereof save as expressly
provided in this Agreement.
5. FEES AND EXPENSES
5.01 Subject to Clause 5.03, the Borrower shall pay to the Agent for
account of the Lenders pro rata according to their respective
Commitments whether or not any part of the Loan is drawndown
hereunder, a commitment fee at the rate of nought point two five per
centum (0.25%) per annum on the undrawn portion of the Commitment (if
any) from time to time in Dollars, such commitment fee to accrue from
the date of this Agreement and to be paid in Dollars semi-annually in
arrears on 28th June and 28th December of each year up to and
including the last day of the Drawdown Period calculated on the exact
number of days elapsed and a three hundred and sixty (360) day year.
5.02 The Borrower shall pay to the Agent for account of the Lead Arranger,
the Arrangers and the Lenders as may be agreed between them a
non-refundable management fee in accordance with the Fee Letter, such
management fee being payable on the day of drawdown of the first
Advance under this Agreement.
Page 18
5.03 The Borrower shall pay to:
(a) the Agent an annual agency fee in advance in accordance with the
Fee Letter; and
(b) the Trustee an annual trustee fee in advance in accordance with
the Trustee Fee Letter,
in each case payable on the date of signing this Agreement and
thereafter on 28th December of each year throughout the Loan Period.
5.04 The Borrower shall pay to the Agent on demand:
(a) all reasonable expenses (including communication, travelling,
legal, printing and out-of-pocket expenses) properly incurred by
the Lenders and/or the Agent in connection with the negotiation,
preparation, execution, syndication and, where relevant,
registration of this Agreement and the Security Documents and of
any amendment or extension or the granting of any waiver or
consent under this Agreement and/or any of the Security
Documents;
(b) all expenses (including legal and out-of-pocket expenses)
incurred by the Lenders and/or the Agent in contemplation of, or
otherwise in connection with, the enforcement of, or preservation
of any rights under, this Agreement and/or any of the Security
Documents, or otherwise in respect of the moneys owing under this
Agreement and/or any of the Security Documents; and
(c) interest at the rate referred to in Clause 3.04 on such expenses
from the date on which such expenses were demanded from the
Borrower to the date of payment (as well after as before
judgment).
5.05 The Borrower shall pay all stamp, documentary, registration or other
like duties, taxes, fees or charges (including any duties, taxes, fees
or charges payable by the Lenders and/or the Agent) imposed on or in
connection with this Agreement and/or any of the Security Documents or
the Loan and shall indemnify the Lenders and/or the Agent against any
liability arising by reason of any delay or omission by the Borrower
to pay such duties, taxes, fees or charges.
6. PAYMENTS AND TAXES; ACCOUNTS AND CALCULATIONS
6.01 All payments to be made by the Borrower under this Agreement and/or
any of the Security Documents shall be made in full, without any
set-off or counterclaim whatsoever and, subject as provided in Clause
6.07, free and clear of any deductions or withholdings, in Dollars not
later than 10:00 a.m. (local time) on the due date to the Receiving
Bank for the account of the Agent or to such other account as the
Agent shall have notified to the Borrower. Save as otherwise expressly
agreed by the parties hereto, such payments shall be for the account
of the Lenders according to their respective Contributions and the
Agent shall forthwith distribute such payments to the Lenders in like
funds as are received by the Agent. Payments due from the Agent to the
Lenders shall be made to the Lenders at such accounts as they notify
to the Agent from time to time.
6.02 All sums to be advanced by the Lenders under this Agreement shall be
remitted in Dollars, on the relevant Drawdown Date of each Advance to
such account of the Agent as the Agent may have notified the Lenders
and shall be paid by the Agent on that date in like funds as are
received by the Agent to the account of the Borrower or to such
account as the Borrower may direct as specified in the relevant
Drawdown Notice.
6.03 Where any sum is to be paid hereunder to the Agent for account of
another person, the Agent may assume that the payment will be made
when due and may (but shall not be obliged to) make such sum available
to the person so entitled. If it proves to be the case that such
payment was not made to the Agent, then the persons to whom such sum
was so made available shall on request refund such sum to the Agent
together with interest thereon sufficient to compensate the Agent for
the cost of making available such sum up to the date of such
repayment. The provisions of this Clause 6.03 shall be without
prejudice to the Borrower's rights against the Lender concerned under
Clause 2.03 where any Lender has failed to make any payment due to the
Agent for the account of the Borrower on its due date.
6.04 When any payment under this Agreement or any of the Security Documents
would otherwise be due on a day which is not a Banking Day, the due
date for payment shall be extended to the next following Banking Day
unless such Banking Day falls in the next calendar month in which case
payment shall be made on the immediately preceding Banking Day.
Page 19
6.05 All interest and other payments of an annual nature under this
Agreement or any of the Security Documents shall accrue from day to
day and be calculated on the basis of actual days elapsed and a three
hundred and sixty (360) day year.
6.06 Any certificate or determination of the Agent (after consultation with
the Lead Arranger, the Arrangers, and the Lenders as to any rate of
interest or any other amount payable under this Agreement or any of
the Security Documents) shall, in the absence of manifest error, be
conclusive and binding on the Borrower and on each of the Lenders.
6.07 Subject to the provision of this Clause 6, if at any time any
applicable law, regulation or regulatory requirement or any
governmental authority, monetary agency or central bank requires the
Borrower to make any deduction or withholding in respect of Taxes from
any payment due under this Agreement or any of the Security Documents,
the sum due from the Borrower in respect of such payment shall be
increased to the extent necessary to ensure that, after the making of
such deduction or withholding, the Agent and each of the Lenders
receive on the due date for such payment (and retains free from any
liability in respect of such deduction or withholding) a net sum equal
to the sum which they would have received had no such deduction or
withholding been required to be made and the Borrower shall indemnify
the Lenders and the Agent against any losses or costs incurred by them
by reason of any failure of the Borrower to make any such deduction or
withholding or by reason of any increased payment not being made on
the due date for such payment. The Borrower shall promptly deliver to
the Agent any receipts, certificates or other proof evidencing the
amounts (if any) paid or payable in respect of any deduction or
withholding as aforesaid.
6.08 (a) is entitled, without material rearrangement of its Tax affairs,
to receive, or is granted by any relevant Tax authority, any
credit against or relief from its liability to any Tax), in
respect of any Tax on account of which a deduction or withholding
has been made from any sum payable by the Borrower under or in
relation to this Agreement and in respect of which the Borrower
has paid in full an increased amount pursuant to Clause 6, then
such Relevant Person shall to the extent that it can do so
without affecting its rights as against the relevant Tax
authority to retain such credit or relief, act (but without any
legal obligation to do so) in good faith so as to refund to the
Borrower that amount (not exceeding the amount by which the
relevant amount payable by the Borrower was increased to
compensate for such deduction or withholding) of such credit or
relief which is determined by such Relevant Person in its sole
discretion to be attributable to such deduction or withholding
after subtracting any reasonable expenses attributable to the
determination thereof Provided that this provision shall in no
way interfere with the liberty of each Relevant Person to arrange
its tax affairs in whatsoever manner it thinks fit or oblige a
Relevant Person to disclose details of the same to the Borrower.
(b) The Agent and each Lender shall consider any request from the
Borrower to take action to avoid the incidence of any deduction
or withholding by applying for any appropriate relief, waiver or
exemption from the same, and in addition shall consider in their
absolute discretion, subject to indemnification by the Borrower
for any costs incurred by the Lenders and/or the Agent and to
obtaining any necessary consents and authorisations, fulfilling
its obligations through another lending office or transferring
its rights and obligations at par to one or more of its
Affiliates if such transfer would result in there being no
requirement for a deduction or withholding Provided that neither
the Agent or any Lender shall by reason of this Clause 6.08(b) be
under any legal obligation to take any action whatsoever.
6.09 Notwithstanding anything to the contrary in this Agreement or in any
of the other Security Documents, the Borrower shall not (unless an
Event of Default has occurred and is continuing) be obliged to make
any payment to or for the account of the Agent or any Lender in
respect of any of the following:
(a) (save as set out in Clause 5) the normal administrative costs and
expenses of the Agent or any Lender;
(b) any Tax on or in respect of the overall net income of the Agent
or any Lender or of a division or branch of the Agent or any
Lender wherever imposed;
(c) penalties, additions to Taxes, fines or interest on Taxes which
would not have arisen but for a reasonably avoidable delay or
failure by the Agent or any Lender in the filing of Tax returns
or payment of Taxes assessed on the Agent or any Lender, which
delay or failure has not directly or indirectly been consented
to, caused by or requested by the Borrower; or
Page 20
(d) any Tax which would not have arisen for an act or omission of the
Agent or any Lender which constitutes wilful misconduct or gross
negligence on its part.
6.10 Each Lender shall maintain, in accordance with its usual practice, an
account or accounts evidencing the amounts from time to time lent by,
owing to and paid to it, under this Agreement and the Security
Documents. The Agent will maintain a control account showing the Loan
and other sum owing by the Borrower under this Agreement and all
payments in respect thereof made by the Borrower from time to time.
Such control account shall in the absence of manifest error be
conclusive as to the amount from time to time owing by the Borrower
under this Agreement and the Security Documents.
7. REPRESENTATIONS AND WARRANTIES
7.01 Save as disclosed to the Agent in writing before submission of the
first (1st) Drawdown Notice under this Agreement, the Borrower hereby
represents and warrants to the Lenders and the Agent that:
(a) the Borrower is duly incorporated, validly existing in
goodstanding under the laws of the Republic of Liberia, has full
power to borrow the Loan, and to carry on its business and to
enter into and perform its obligations under this Agreement, and
the Relevant Documents to which it is or will be a party, is in
compliance in all material respects with all statutory and other
requirements relative to its business, and has taken all
necessary corporate and other action and has obtained all
necessary consents to authorise the borrowing and incurring of
indebtedness under, and the execution, delivery and performance
of, this Agreement and the Relevant Documents to which it is or
will be a party; this Agreement and, as executed and delivered,
constitutes and such Relevant Documents, when executed and
delivered and (in the case of the Mortgage) when duly recorded
will constitute, valid and legally binding obligations of the
Borrower enforceable in accordance with their respective terms
except insofar as enforcement may be limited by any applicable
laws relating to bankruptcy, insolvency, administration and
similar laws affecting creditors rights generally, and except
insofar as stated in any qualification or reservation contained
in any original legal opinion given for the purpose of or as a
condition precedent to this Agreement;
(b) the parties (other than the Lenders, the Counterparties and the
Agent) to the Relevant Documents have full power to enter into
and perform their respective obligations under the Relevant
Documents (other than the Sales Contract and the Trustee and
Paying Agent Agreement) to which each of them is or will be a
party (and in connection therewith all necessary corporate or
other action has been taken and all necessary consents and
approvals have been obtained) and such Relevant Documents, when
executed and delivered, will constitute the valid and legally
binding obligations of each such party enforceable in accordance
with their respective terms except insofar as enforcement may be
limited by any applicable laws relating to bankruptcy,
insolvency, administration and similar laws affecting creditors'
rights generally, and except insofar as stated in any
qualification or reservation contained in any original legal
opinion given for the purpose of or as a condition precedent to
this Agreement;
(c) the execution, delivery and performance of this Agreement and the
Relevant Documents to which the Borrower, the Chargors, the
Manager and the Sub-Manager (as the case may be) are or will
become respectively parties will not (i) contravene any
applicable law, regulation or material contractual restriction
binding on the Borrower or the other parties thereto; or (ii)
result in any material breach of or default under any agreement
or other instrument to which the Borrower or such party is
subject; or (iii) contravene any provision of the incorporation
documents of the Borrower or such party; or (iv) result in the
creation or imposition of or oblige the Borrower or such party to
create any Encumbrance (other than a Permitted Encumbrance) on
any of their respective material undertakings, or any of their
respective assets, rights or revenues;
Page 21
(d) no material litigation, arbitration or administrative proceeding
is pending or threatened against the Borrower, any of its assets,
the Manager, or the Sub-Manager insofar as the Borrower is aware;
(e) the Borrower is not in material default under any agreement or
other instrument, or in material default in the payment or
performance of any of its obligations for Borrowed Money;
(f) the latest audited financial statements of the Borrower (if any,
or, if there are none, the first and thereafter each subsequent
financial statement of the Borrower delivered to the Agent
pursuant to Clause 8.01 (e)) have been prepared in accordance
with generally accepted accounting principles and practices which
have been consistently applied, and present fairly and accurately
the financial position of the Borrower as at the date of the said
accounts and the results of the operations of the Borrower for
the financial year ended on such date, and as at such date, the
Borrower had no significant liabilities (contingent or otherwise)
which are not disclosed by, or reserved against in, such
financial statements or any unrealised or anticipated losses;
(g) there has been no material adverse change in the financial
position of the Borrower from that set forth in the financial
statements referred to in Clause 7.01(f);
(h) no Default, whether or not any requirement for notice and/or
lapse of time (or both) and/or any other condition has been
satisfied, has occurred and is continuing;
(i) the choice by the Borrower of English law to govern this
Agreement and the other Relevant Documents to which it is a party
(other than the Mortgage and the Collateral Agreement) and the
choice by the Borrower of New York law to govern the Collateral
Agreement and the submission by the Borrower to the non-exclusive
jurisdiction of the English courts are valid and binding except
insofar as enforcement may be limited by any applicable laws
relating to bankruptcy, insolvency, administration and similar
laws affecting creditors' rights generally, and except insofar as
stated in any qualification or reservation contained in any
original legal opinion given for the purpose of or as a condition
precedent to this Agreement;
(j) neither the Borrower, the Manager or the Sub-Manager nor any of
their respective assets are 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);
(k) the Vessel is or will on the Delivery Date and thereafter be:
(i) in the absolute and (save for a first mortgage in favour of
the Agent and for Permitted Encumbrances) unencumbered
ownership of the Borrower as the sole, legal and beneficial
owner of such Vessel;
(ii) registered in the name of the Borrower under the laws and
flag of the Republic of Liberia;
(iii) operationally seaworthy and in every way fit for service
(except as notified in writing to the Agent); and
(iv) (save for changes to the Vessels classification approved in
advance and in writing by the Agent) classed "+100A1,
Liquefied Gas Carrier, Ship Type 2G" + LMSC, UMS, NAVI,
SCM, *IWS" with ▇▇▇▇▇'▇ Register of Shipping, free from any
requirements and recommendations of the said classification
society which must be complied with by the Borrower as a
condition of the maintenance of the Vessel's class, it
being agreed that the Borrower shall, in relation to the
period following the Delivery Date, be deemed in compliance
with its warranty in this respect, provided that it duly
complies with all such requirements and recommendations
within the relevant period permitted for compliance by the
said classification society;
Page 22
(l) the obligations of the Borrower under this Agreement are direct,
general and unconditional obligations of the Borrower;
(m) the Borrower has disclosed to the Lenders all its material
liabilities (actual and contingent) and Indebtedness;
(n) every material consent, authorisation, licence or approval of, or
registration with or declaration to, governmental or public
bodies or authorities or courts required by the Borrower to
authorise, or required by the Borrower in connection with, the
execution, delivery, validity, enforceability or admissibility in
evidence of this Agreement and each of the Relevant Documents to
which it is or will be a party or the performance by the Borrower
of its obligations hereunder or thereunder has been or, in the
case of the Relevant Documents to which it is or will be a party,
will prior to the execution thereof have been obtained or made
and is or, in the case of the Relevant Documents to which it is
or will be a party, will prior to the execution thereof be in
full force and effect and there has been no material default in
the observance of any of the conditions or restrictions imposed
in or in connection with any of the same;
(o) the written information, exhibits and reports furnished by the
Borrower to the Agent in connection with the negotiation and
preparation of this Agreement and each of the Relevant Documents,
and in particular all information provided in writing by the
Borrower, the Chargors and the issuers of the Letters of
Undertaking used to prepare the Information Memorandum, are at
the time of being made available and at the time of the first
Advance true and accurate in all material respects and not
misleading, do not omit material facts and all reasonable
enquiries have been made to verify the facts and statements
contained therein; there are no other material facts the omission
of which would make any fact or statement therein misleading;
(p) no Taxes (other than Indonesian Taxes) are imposed by withholding
or otherwise on any payment to be made under this Agreement or
the Relevant Documents (other than the Sales Contract and the
Trustee and Paying Agent Agreement) or are imposed on or by
virtue of the execution or delivery of this Agreement or the
Relevant Documents (other than the Sales Contract and the Trustee
and Paying Agent Agreement) or any other document or instrument
to be executed or delivered hereunder or thereunder;
(q) save for the registration of the Mortgage at the Office of the
Deputy Commissioner of Maritime Affairs in the Republic of
Liberia, it is not necessary to ensure the legality validity,
enforceability or admissibility in evidence of this Agreement or
any of the Relevant Documents (other than the Trustee and Paying
Agent Agreement and the Sales Contract) that it or they or any
other instrument be notarised, filed, recorded, registered or
enrolled in any court, public office or elsewhere in the Republic
of China, the Republic of Liberia, Indonesia or England or that
any stamp, registration or similar tax or charge be paid in the
Republic of China, the Republic of Liberia, Indonesia or England
on or in relation to this Agreement or any of the Relevant
Documents (other than the Trustee and Paying Agent Agreement and
the Sales Contract);
(r) this Agreement and each of the Relevant Documents (other than the
Trustee and Paying Agent Agreement and the Sales Contract) is (or
will upon execution be) in proper form for its enforcement in the
courts of England;
(s) none of the Vessel, her Earnings, Insurances or Requisition
Compensation (each as defined in the Mortgage) the Charter, the
Contract, the Refund Guarantees, the Bank Guarantee, the
Performance Bond, the Management Agreement, the Sub-management
Agreement or any part thereof is or will be, subject to any
Encumbrance save for any Permitted Encumbrance;
Page 23
(t) all advances, loans or other monies made available to the
Borrower by its shareholders or stockholders or any related or
associated company rank after and inferior to the Loan and the
Borrower's Indebtedness under this Agreement;
(u) the Borrower has not established a place of business in the
United Kingdom;
(v) the entire issued share capital of the Borrower comprises one
thousand (1,000) shares of par value $1.00 per share registered
as to 400 shares in the name of CPC, 400 shares in the name of
Oxbow and 200 shares in the name of Golar Maritime;
(w) the copies of the Relevant Documents (other than the Security
Documents) and all other written information, documentary
evidence and certificates delivered or to be delivered to the
Agent pursuant to Clause 9.01 and/or in connection with the
Information Memorandum are, or will when delivered be, genuine,
true and complete copies of such documents; the Relevant
Documents (other than the Sales Contract and the Trustee and
Paying Agent Agreement) constitute, or when executed will
constitute, valid and binding obligations of the Borrower and the
other parties thereto enforceable in accordance with their
respective terms (except insofar as enforcement may be limited by
any applicable laws relating to bankruptcy, insolvency,
administration and similar laws affecting creditors' rights
generally, and except insofar as stated in any qualification or
reservation contained in any original legal opinion given for the
purpose of or as a condition precedent to this Agreement) and no
material amendments thereof or variations thereto have been made
or will, without the consent of the Agent, be made;
(x) each Refund Guarantee and the Bank Guarantee is, or upon issuance
will be, in full force, validity and effect and constitutes, or
upon issuance will constitute valid and legally binding
obligations of its issuing Bank Guarantor, enforceable against
its issuing Bank Guarantor, in accordance with its terms except
insofar as enforcement may be limited by any applicable laws
relating to bankruptcy, insolvency, administration and similar
laws affecting creditors' rights generally, and except insofar as
stated in any qualification or reservation contained in any
original legal opinion given for the purpose of or as a condition
precedent to this Agreement;
(y) the Performance Bond is, or upon issuance will be, in full force,
validity and effect and constitutes, or upon issuance will
constitute valid and legally binding obligations of The Tokai
Bank, Ltd., enforceable against The Tokai Bank, Ltd. in
accordance with its terms except insofar as enforcement may be
limited by any applicable laws relating to bankruptcy,
insolvency, administration and similar laws affecting creditors'
rights generally, and except insofar as stated in any
qualification or reservation contained in any original legal
opinion given for the purpose of or as a condition precedent to
this Agreement; and
Page 24
(z) the Borrower has not entered into any other material agreements
other than the Relevant Documents and other than agreements
entered into by the Borrower in the ordinary course of business.
7.02 The representations and warranties in Clause 7.01 (other than those
set out in Clause 7.01(o), (p), (q) and (r) and so that the
representation and warranty in Clause 7.01 (f) shall for this purpose
refer to the then latest audited financial statements delivered to the
Agent under Clause 8.01(e)) shall be deemed to be repeated by the
Borrower on and as of each day from the date of this Agreement until
all moneys due or owing by the Borrower under this Agreement and the
Security Documents have been paid in full as if made with reference to
the facts and circumstances existing at each such date.
8. UNDERTAKINGS
8.01 The Borrower hereby undertakes with the Lenders and the Agent that,
from the date of this Agreement and so long as any moneys are owing
under this Agreement or the Security Documents, the Borrower will:
(a) promptly inform the Agent of any occurrence of which it becomes
aware which might materially and adversely affect its ability to
perform its obligations under this Agreement and/or any of the
Relevant Documents and, without limiting the generality of the
foregoing, will inform the Agent of any Default forthwith upon
becoming aware thereof;
(b) without prejudice to Clauses 7.02 and 9, obtain or cause to be
obtained, maintain in full force and effect and comply in all
material respects with the conditions and restrictions (if any)
imposed in or in connection with every consent, authorisation,
licence or approval of governmental or public bodies or
authorities or courts and do, or cause to be done, all other acts
and things, which may from time to time be necessary or desirable
under applicable law for the continued due performance of all its
obligations under this Agreement and each of the Relevant
Documents;
(c) use the Loan exclusively for the purposes specified in Clause
1.01;
(d) file or cause to be filed all tax returns required to be filed in
all jurisdictions in which it is situated or carries on business
or is otherwise subject to Taxation and pay all Taxes shown to be
due and payable on such returns or any assessments made against
it (other than those being contested in good faith and where such
payment may be lawfully withheld);
(e) prepare audited financial statements of the Borrower in
accordance with generally accepted accounting principles and
practices in the United States of America (or such other
generally accepted accounting principles consented to by the
Agent, such consent not to be unreasonably withheld) consistently
applied in respect of each financial year and cause the same to
be certified by its auditors and prepare unaudited financial
statements of the Borrower in respect of the first six (6) month
period of each of its financial years on the same basis as the
annual statements and deliver as many copies of the same as the
Agent may reasonably require for distribution to the Lenders as
soon as practicable, but not later than one hundred and twenty
(120) days (in the case of audited financial statements) or
ninety (90) days (in the case of unaudited financial statements)
after the end of the financial period to which they relate;
(f) deliver to the Agent for distribution to the Lenders and the
Agent as many copies as the Agent may reasonably require of every
report, circular, notice or like document issued by the Borrower,
the Manager, and each of the Chargors to its shareholders or
creditors generally, in each case at the time of issue thereof;
(g) provide the Agent with such financial and other information
concerning the Borrower, the Manager, the Sub-manager, each of
the issuers of the Letters of Undertaking and each of the
Chargors and its affairs as the Agent may from time to time
reasonably require including, without limitation, unaudited
financial statements in respect of the first six (6) month period
of each of its financial years and audited financial statements
in respect of each financial year and details of any material
litigation pending or, to the knowledge of the Borrower,
threatened against the Borrower, the Manager, the Sub-Manager,
the issuers of the Letters of Undertaking or the Chargors or the
Vessel;
Page 25
(h) duly and punctually perform and use its best endeavours to
procure the due and punctual performance by each of the other
parties (other than the Lenders and the Agent) of each of their
respective material obligations under the Relevant Documents;
(i) ensure that its obligations under this Agreement and the Relevant
Documents to which it is a party rank at all times at least pari
passu with all its other present and future unsecured
Indebtedness except as mandatorily preferred by law and not by
contract;
(j) provide the Agent with copies on a monthly basis of all progress
reports, change orders and test results and notice and results of
sea and gas trials and all such other information as the Agent
may reasonably require regarding the Contract and the
construction of the Vessel including, without limitation,
evidence of the Charterer's approval of all relevant stages of
construction in order to satisfy the Lenders that the Charterer
will accept the Vessel under the Charter on the Delivery Date;
(k) if any event occurs or circumstance exists as a result of which
the information which has been provided by it to the Agent
hereunder would include an untrue statement of a material fact or
omit to state any material fact or any fact necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, the Borrower will inform the
Agent and will promptly furnish to the Agent updated or revised
information which will correct such untrue statement or include
such omitted fact;
(l) to provide such co-operation and assistance as may reasonably be
required by any independent technical consultant appointed by and
at the cost of the Borrower (having first consulted with the
Lenders as to the identity and suitability of the technical
consultant) to oversee or report on the construction, maintenance
and/or operation of the Vessel at any time;
(m) twelve (12) months prior to the expiry of the Swap Agreement,
agree whether any interest rate hedging strategy is necessary in
order to protect the interests of the Lenders in relation to
interest payments scheduled to be made under this Agreement, and
if the same is considered in good faith by the Agent to be
prudent (having regard to the then prevailing market interest
rates and their volatility and the amount of the Loan then
outstanding) to agree the scope and duration of such strategy;
and
(n) submit to the Agent, before the Delivery Date, a schedule for and
its policies in relation to establishing reserves to fund day to
day and scheduled operating expenses of the Vessel over the term
of the Charter and to fund contingency reserves.
8.02 The Borrower hereby undertakes with the Lenders and the Agent that
during the Loan Period the Borrower shall not, without the express
prior written consent and approval of the Lenders:
(a) permit after the Delivery Date any Encumbrance to exist upon the
Vessel (other than (1) the Mortgage and Permitted Encumbrances,
(2) liens for taxes not delinquent or being contested in good
faith, (3) deposits or pledges to secure performance of bids,
tenders, contracts (other than contracts for the payment of
Borrowed Money), leases, public or statutory obligations, surety
or appeal bonds, or other deposits or pledges for purposes of
like general nature incurred in the ordinary course of business,
(4) liens for current crews' wages and liens for salvage, (5)
liens or other Encumbrances arising in the ordinary course of
business or by operation of law (each of (2) to (5) inclusive
above being deemed to be Permitted Encumbrances for the purposes
of this Clause 8.02)); or sell all or part of, the Vessel; or
(b) cause any debentures to be issued, nor create, incur, permit to
exist or assume any mortgage, pledge, lien, fixed or floating
charge or other security interest or Encumbrance upon or with
respect to any of its property or assets or assign or otherwise
convey any rights to receive income, other than Permitted
Encumbrances; or
Page 26
(c) create, incur, assume, suffer to exist or in any manner become or
remain liable for any Indebtedness for Borrowed Money or for
lease rentals, other than (1) Indebtedness under the Contract or
normally associated with the day to day operation of the Vessel,
or otherwise in the normal course of business, in each case which
is not material, (2) Indebtedness under this Agreement and the
other Security Documents and (3) Indebtedness, including all
shareholder's advances, which by its terms is subordinate and
subject in right of payment to the prior payment in full of the
Indebtedness under or pursuant to this Agreement and the Security
Documents; or
(d) assume, guarantee, endorse, contingently agree to purchase or
provide funds for the payment of, agree to maintain the net worth
or working capital of or otherwise support or "keep well" or
otherwise become liable in respect of any material obligation of
any person, except (1) by the endorsement of negotiable
instruments for deposit or collection or similar transactions in
the ordinary course of business, or (2) in favour of the Lenders
and/or the Agent; or
(e) make any loan or advance to any person, other than loans or
advances which are made in the ordinary course of business and
which are not material; or
(f) incur any Indebtedness to any of the Chargors or any of its or
their associated companies which does not rank after its
Indebtedness under this Agreement in priority of payment; or
(g) redeem, repay, purchase, cancel or otherwise return, acquire or
reduce all or any class or part of its issued share or loan
capital (the written consent of the Lenders not to be
unreasonably withheld); or
(h) permit any transfer or change in the registered ownership of any
of its issued shares at the date of this Agreement, or allot or
issue any new shares, or grant or permit the granting of any
option to acquire any of its issued or unissued shares (the
written consent of the Lenders not to be unreasonably withheld);
or
(i) acquire any vessel other than the Vessel; or
(j) carry on or engage in or be concerned with any business or
activities except those of owner and operator of an ocean-going
vessel and activities incidental thereto; or
(k) sell, lease, transfer or otherwise dispose of, or (save for
requisitions for hire or requisitions of title) cease to exercise
full and direct control over any part of its present or future
undertaking, properties, assets, rights or revenues (whether by
one or series of transactions, related or not); or
(l) change its accounting periods or its auditors (the written
consent of the Lenders not to be unreasonably withheld); or
(m) factor, sell, assign, discount or otherwise dispose of any
present or future book or other debts, claims or securities for
money; or
(n) form or co-operate in the formation of, or purchase or acquire
any Subsidiary; or
(o) permit any change to be made in its overall control or permit any
material change to be made in its management (the written consent
of the Lenders not to be unreasonably withheld); or
(p) amalgamate, merge or consolidate with any other company or person
or undertake, undergo, enter into or become subject to any kind
of reconstruction or reorganisation or any scheme or arrangement
for any of the foregoing; or
(q) up to and including the Delivery Date, permit its Debt/Equity
Ratio to be more than 78:22.
Page 27
8.03 The Borrower hereby undertakes with the Lenders and/or the Agent that,
from the Delivery Date and so long as any moneys are owing under this
Agreement or any of the other Security Documents, the Borrower will:
(a) ensure that the Vessel is:
(i) in the absolute and unencumbered ownership of the Borrower
and registered in the name of the Borrower, subject only to
the Mortgage and any Permitted Encumbrances, which will be
registered against the Vessel through the Office of the
Deputy Commissioner of Maritime Affairs of the Republic of
Liberia in New York;
(ii) on each occasion immediately before the vessel leaves any
port, operationally sea-worthy and in every way fit for
service under and in compliance with the terms of the
Charter;
(iii) classed and insured in accordance with the provisions of
the Mortgage and the General Assignment; and
(iv) on time charter to the Charterer (or any other party to
which the Charterer is entitled to assign its rights under
the Charter in circumstances where it remains fully liable
under the Charter) under the Charter (or on time charter to
any other charterer under any other charter in replacement
of the Charter which the Borrower may enter into with the
prior written consent of the Lenders which the Lenders may
withhold entirely at their discretion) at a rate of hire
sufficient to meet the operating and maintenance expenses
of the Vessel and the Borrower's payment obligations under
this Agreement and the Security Documents;
(b) not permit any company other than the Manager or such other
company as shall be approved in writing by the Agent (such
consent not to be unreasonably withheld), to be the manager of
the Vessel;
(c) not permit any company other than ▇▇▇▇▇▇-▇▇▇▇▇▇ International
Limited, or such other company as shall be approved in writing by
the Agent (such approval not to be unreasonably withheld,
provided (without limitation) that the Agent may withhold its
consent if the rights or interests of the Agent and/or the
Lenders might be adversely affected) to be the Sub-manager of the
Vessel under the Sub-Management Agreement;
(d) not without the consent of the Lenders (such consent not to be
unreasonably withheld) change the flag or registry of the Vessel;
and
(e) ensure that the Borrower shall furnish the Agent for distribution
to the Lenders from time to time promptly on request:
(i) documentary evidence of the Vessel's provisional
registration (and subsequently the Vessel's permanent
registration, which the Borrower undertakes to obtain
within 270 days of the Delivery Date) in the name of the
Borrower under the laws and flag of the Republic of
Liberia;
(ii) all such information as the Agent shall from time to time
reasonably require regarding the Vessel, her employment,
position and engagements, particulars of all towages and
salvages, copies of all charters and other contracts for
her employment or otherwise howsoever concerning her;
(iii) at the request of the Agent, on no more than one occasion
in each twelve (12) month period, provide the Agent at the
expense of the Borrower with a valuation report of the
Vessel by an independent broker or valuer acceptable in all
respects to the Agent; and
Page 28
(iv) all such information as the Agent shall from time to time
reasonably require regarding all insurances on or in
respect of the Vessel and copies of all policies, cover
notes and all other contracts of insurance which are from
time to time taken out or entered into in respect of the
Vessel or otherwise howsoever in connection with the Vessel
so that the Agent is at all times able to determine whether
the Vessel has been adequately insured as provided for in
the Mortgage and the General Assignment;
(f) disclose to the Agent all material agreements relevant to the
Loan and the Relevant Documents made by or between the Borrower
and any other parties to any Relevant Document, and to disclose
any other material agreements relevant to the Loan and the
Relevant Documents of which it becomes aware;
(g) provide the Agent for distribution to the Lenders financial
information relating to the Vessel and its operations when
requested and in any event semi-annually;
(h) upon first demand by the Agent and subject always to the Borrower
obtaining the consent of the Charterer, which the Borrower
undertakes to use its best endeavours to obtain), transfer the
Vessel from the Liberian Registry to such other registry as the
Agent and the Borrower may agree, or failing agreement such
registry as the Agent may nominate, and subject to a new mortgage
in favour of the Agent such form as the Agent may require.
8.04 The Borrower hereby undertakes with the Lenders and the Agent that:-
(a) without prejudice to any other retentions to be made pursuant to
the provisions of the Security Documents, the Borrower shall
establish with the Trustee a debt reserve fund which, for the
period of five (5) years from the Delivery Date shall, once
established, be:
(i) in the period up to and including the First Repayment Date
maintained in an amount not less than the aggregate amounts
of principal, Net Interest and other moneys payable by the
Borrower under the Financial Agreement, the Swap Agreements
and the Additional Swap Agreements on the First Repayment
Date; and
(ii) following the First Repayment Date, maintained in an amount
not less than the aggregate amounts of principal, Net
Interest and other moneys payable by the Borrower under the
Financial Agreement, the Swap Agreements and the Additional
Swap Agreements during a period of six (6) months from the
first day of each Interest Period (such sum as conclusively
certified by the Agent in accordance with Clause 5.04 of
the Collateral Agreement) and thereafter (provided (i)
there has been no default which is continuing under this
Clause 8.04(a) and (ii) the Agent has expressly consented
having first obtained approval from the Majority Lenders)
shall be maintained in an amount not less than a sum equal
to five (5) months' debt service requirement (certified as
aforesaid) for the remainder of the Security Period;
Page 29
(b) on the first Repayment Date and thereafter throughout the
remainder of the Loan Period, the Borrower shall maintain a debt
service coverage ratio ("DCR") at or above 1.10:1 where
Cash Available
DCR =
-----------------------------------
Loan principal, Net Interest and fees and expenses payable
under this Agreement and the Security Documents (i) in
respect of the first Repayment Date, in the six months
immediately preceding the first Repayment Date, and (ii)
in respect of any other Repayment Date, in the period
commencing on (but excluding) the immediately preceding
Repayment Date and completing on (and including) the next
ensuing Repayment Date (each a "repayment period"); and
(c) the Borrower will not without the prior written consent of the
Agent pay any dividends prior to the first Repayment Date and
thereafter only out of funds standing to the credit of the
Surplus Account (as defined in the Collateral Agreement) and
subject to (i) compliance with the provisions of sub-clauses (a)
and (b) above, (ii) maintaining the Debt Service Reserve as
required by clause 5 of the Collateral Agreement, and (iii) no
Default having occurred and continuing, and (iv) the Borrower
confirming in writing to the Agent that it does not anticipate
any cash deficiency which might prevent it meeting forecasted
operating costs and capital expenditure of the Vessel and
scheduled payments under this Agreement, the Swap Agreements and
the Additional Swap Agreements during the immediately succeeding
12 month period.
9. CONDITIONS
9.01 The obligation of the Lenders to make the COMMITMENT AVAILABLE shall
be subject to the condition that the Agent, or its duly authorised
representative, shall have received no later than SEVEN (7) BANKING
DAYS before the day on which the FIRST DRAWDOWN NOTICE for an Advance
is given, the documents and evidence specified in PART 1 OF SCHEDULE 3
in form and substance satisfactory to the Agent.
9.02 The obligation of the Lenders to make EACH SUBSEQUENT ADVANCE other
than the Advance on the Delivery Date shall be subject to the
condition that the Agent, or its duly authorised representative, shall
have received no later than the DATE ON WHICH THE DRAWDOWN NOTICE FOR
SUCH ADVANCE IS GIVEN, the documents and evidence specified in PART 2
OF SCHEDULE 3, in form and substance satisfactory to the Agent.
9.03 The obligation of the Lenders to make the ADVANCE ON THE DELIVERY DATE
available or to maintain the Loan on or after the Delivery Date, shall
be subject to the condition that the Agent, or its duly authorised
representative, shall have received NO LATER THAN THE DATE ON WHICH
THE DRAWDOWN NOTICE for such Advance is given, the documents and
evidence specified in PART 3 OF SCHEDULE 3, in form and substance
satisfactory to the Agent.
9.04 The obligation of the Lenders to make the ADVANCE ON THE DELIVERY DATE
available or to maintain the Loan on or after the Delivery Date, shall
be subject to the condition that the Agent, or its duly authorised
representative, shall have received ON OR PRIOR TO THE DELIVERY DATE
the documents and evidence specified in PART 4 OF SCHEDULE 3 in form
and substance satisfactory to the Agent.
Page 30
9.05 The obligation of the Lenders to make any Advance is subject to the
further condition that at the time of giving each Drawdown Notice for,
and at the time of the making of, each Advance:
(a) the representations and warranties set out in Clauses 7.01 and
7.02 (and so that the representation and warranty in Clause 7.01
(f) shall for this purpose refer to the then latest audited
financial statements delivered to the Agent under Clause 8.01
(e)) are true and correct on and as of each such time as if each
was made with respect to the facts and circumstances existing at
such time; and
(b) no Default shall have occurred and be continuing or would result
from the making of the Advance.
9.06 Not later than seven (7) Banking Days prior to the date on which any
Advance is to be drawndown or, as the case may be, each Interest
Payment Date, the Agent may request and the Borrower shall, not later
than two (2) Banking Days prior to such date if it is practicable to
do so, or otherwise (with the consent of the Agent) as soon as
possible thereafter, deliver to the Agent on such request further
information as to any or all of the matters which are the subject of
Clauses 7, 8, 9 and 10.
9.07 The conditions precedent set out in this Clause 9 are inserted for the
sole benefit of the Lenders, and may be waived on their behalf in
whole or in part and with or without conditions by the Lenders on or
before the relevant Drawdown Date without prejudicing the right of the
Agent acting on instructions from the Lenders to require fulfilment of
such conditions in whole or in part at any time thereafter.
10. EVENTS OF DEFAULT
10.01 There shall be an Event of Default if:
(a) the Borrower fails to pay any sum payable by it under this
Agreement and/or any of the Relevant Documents at the time
stipulated in this Agreement or such Relevant Document within two
(2) Banking Days of the due date (or, in the case of any sum
payable on demand, within five (5) Banking Days of demand) or in
the currency or in the manner stipulated in this Agreement or
such Relevant Document; or
(b) the Borrower or any other party (if any, other than the Lenders,
the Counterparties and the Agent) commits any material breach of
or omits to observe any of its obligations or undertakings under
this Agreement and/or any of the Relevant Documents (other than
the Sales Contract and the Trustee and Paying Agent Agreement and
other than as referred to in sub-clause (a) above) and, in
respect of any such breach or omission or any Event of Default
described below which in the reasonable opinion of the Agent is
capable of remedy, such action as the Agent may reasonably
require shall not have been taken within seven (7) Banking Days
of the Agent notifying the Borrower or, as the case may be, such
other party of such default and of such required action; or
(c) any representation or warranty made or deemed to be made or
repeated by or in respect of the Borrower or any other party (if
any, other than the Lenders, the Counterparties and the Agent) in
or pursuant to this Agreement and/or any of the Relevant
Documents or in any notice, certificate or statement referred to
in or delivered under this Agreement and/or any of the Relevant
Documents is or proves to have been materially incorrect in any
material respect with reference to the facts existing at the date
on which such representation or warranty was made or deemed to be
made or repeated and the Majority Lenders consider the same is
likely to have an adverse affect on the ability of the Borrower
or such other party to fulfil its respective material obligations
under this Agreement or under any of the Relevant Documents; or
(d) any material Indebtedness of the Borrower is not paid when due or
becomes due or capable of being declared due prior to the date
when it would otherwise have become due (unless as a result of
the exercise by the Borrower of a voluntary right of prepayment)
or any material guarantee or indemnity given by the Borrower in
respect of Indebtedness is not honoured when due and called upon;
or
Page 31
(e) any consent, authorisation, licence or approval of or
registration with or declaration to governmental or public bodies
or authorities or courts required by the Borrower or any other
party (if any, other than the Lenders, the Counterparties and the
Agent) to authorise, or required by the Borrower or any other
party (if any, other than the Lenders, the Counterparties and the
Agent) in connection with, the execution, delivery, validity,
enforceability or admissibility in evidence of this Agreement
and/or any of the Relevant Documents or the performance by the
Borrower or any such party of its obligations hereunder or
thereunder is modified in a manner unacceptable to the Agent or
is not granted or is revoked or terminated or expires and is not
renewed or otherwise ceases to be in full force and effect or the
Borrower or any such party defaults in the observance of any of
the conditions or restrictions imposed in or in connection with
any of the same and the Majority Lenders consider the same is
likely to have an adverse affect on the ability of the Borrower,
or such other party, to fulfil its respective material
obligations under this Agreement or any of the Relevant
Documents; or
(f) a creditor attaches or takes possession of, or a distress,
execution, sequestration or other process is levied or enforced
upon or sued out against any of the material undertakings,
assets, rights or revenues of the Borrower and is not discharged
within seven (7) Banking Days; or
(g) the Borrower suspends payment of its debts or is unable or admits
inability to pay its debts as they fall due or commences
negotiations with one or more of its creditors with a view to the
general readjustment or rescheduling of all or part of its
indebtedness or proposes or enters into any composition or other
arrangement for the benefit of its creditors generally or
proceedings are commenced in relation to the Borrower under any
law, regulation or procedure relating to reconstruction or
readjustment of debts; or
(h) the Borrower takes any action or any legal proceedings are
started or other steps taken for (i) the Borrower to be
adjudicated or found bankrupt or insolvent (ii) other than
pursuant to a voluntary reconstruction or voluntary amalgamation,
the winding-up or dissolution of the Borrower or (iii) other than
pursuant to a voluntary reconstruction or voluntary amalgamation,
the appointment of a liquidator, trustee, receiver or similar
officer of the Borrower or of the whole or any part of its
undertakings, assets, rights or revenues save for those actions
or legal proceedings considered by the Agent in its sole
discretion to be vexatious or malicious and which are discharged
or stayed within 30 days ; or
(i) any event occurs or proceedings is taken with respect to the
Borrower in any jurisdiction to which it is subject which has an
effect equivalent or similar to any of the events mentioned in
Clause 10.01(f), (g) or (h); or
(j) the Borrower suspends or ceases or threatens to suspend or cease
to carry on its business; or
Page 32
(k) all or a part deemed material by the Majority Lenders of the
undertakings, assets, rights or revenues of, or shares or other
ownership interests in, the Borrower are seized, nationalised,
expropriated or compulsorily acquired by or under the authority
of any government (save that this paragraph (k) shall not apply
in relation to the Vessel in circumstances where the Insurance
proceeds (if any) in relation to such seizure, nationalisation,
expropriation or compulsory acquisition are sufficient to repay,
and result in the repayment in full of, the Outstanding
Indebtedness with 120 days of such occurrence); or
(l) any of the Relevant Documents shall at any time and for any
reason become invalid or unenforceable or otherwise cease to
remain in full force and effect, or if the validity or
enforceability of any of the Relevant Documents shall at any time
and for any reason be contested by any party thereto (other than
the Lenders, the Counterparties and the Agent), or if any such
party shall deny that it has any, or any further, liability
thereunder or it becomes impossible or unlawful for the Borrower
or any other party (if any) to any of the Relevant Documents
(other than the Lenders, the Counterparties and the Agent) to
fulfil any of the material covenants and obligations contained in
any of the Relevant Documents or for the Lenders and/or the Agent
to exercise the rights or any of them vested in it thereunder or
otherwise; or
(m) there occurs, in the opinion of the Majority Lenders, a material
adverse change in the financial condition of the Borrower by
reference to the financial statements referred to in Clause
7.01(f) and/or Clause 8.01 (e); or
(n) any other event occurs or circumstance arises which, in the
opinion of the Majority Lenders, is likely materially and
adversely to affect either (i) the ability of the Borrower or any
other party (if any, other than the Lenders, the Counterparties
and the Agent) to perform all or any of their respective
obligations under or otherwise to comply with the terms of this
Agreement and/or any of the Relevant Documents or (ii) the
security created by this Agreement and/or any of the Relevant
Documents; or
(o) any Encumbrance in respect of any of the property (or part
thereof) which is the subject of the Security Documents (or any
of them) becomes enforceable; or
(p) there is any change in the ultimate legal or beneficial ownership
of the shares in the Borrower or, without the prior written
consent of the Agent, the Manager or the Sub-manager; or
(q) the Borrower or any other party (other than the Lenders, the
Counterparties and the Agent) repudiates this Agreement or any of
the Relevant Documents or does or causes or permits to be done
any act or thing evidencing an intention to repudiate this
Agreement or any of the Relevant Documents; or
(r) any of the Relevant Documents is breached in any material respect
or terminated or cancelled by any party thereto (other than the
Lenders, the Counterparties and the Agent) or any moneys assigned
pursuant to any of the Security Documents are paid other than as
provided therein; or
Page 33
(s) any of the events referred to in paragraphs (d), (f), (g), (h),
(i) or (j) above occurs mutatis mutandis in relation to the
Charterer, the Manager, the Sub-manager, the issuers of the
Letters of Undertaking, any of the Chargors or, prior to the
Delivery Date, the Contractor or the Builder (save, in the case
of the Manager and/or the Sub-manager, in circumstances where a
replacement acceptable to the Agent is appointed within seven (7)
Banking Days and subject to such conditions as the Agent may see
fit); or
(t) the Borrower, the Manager or the Sub-manager fails to comply with
all national and international conventions, laws, and the rules
and regulations thereunder, applicable to the Borrower, the
Manager, the Sub-manager or the Vessel, including without
limitation, all other national and international conventions,
laws, rules and regulations relating to environmental matters,
including discharges of oil, petroleum, petroleum products and
distillates, chemicals, pollutions and other substances if such
failure, in the opinion of the Majority Lenders, could reasonably
be expected to have a material adverse effect on the business,
assets, operations, property or financial condition of the
Borrower or on the security created by the Security Documents; or
(u) the Borrower, the Manager, the Sub-manager or the Vessel is
involved in any incident involving the non-compliance with any
national or international or other conventions, laws, rules and
regulations relating to environmental matters, including
discharges of oil, petroleum, petroleum distillates and other
substances, if such incident could in the opinion of the Majority
Lenders reasonably be expected to have a material adverse effect
on the business, assets, operations, property or financial
condition of the Borrower or on the security created by the
Security Documents and in respect of any such non-compliance
which in the opinion of the Majority Lenders is capable of remedy
such action as the Agent may require shall not have been taken
within ten (10) Banking Days of the Agent notifying the Borrower
of such required action; or
(v) the Borrower or any other relevant party fails or omits to comply
with any requirements of the Vessel's protection and indemnity
association to the effect that any cover (including without
limitation, U.S. Oil Pollution liability if the Vessel if trading
to the United States) is or may be liable to cancellation or
exclusion at any time and, in the case of any exclusion, the
rights of the Lenders, the Counterparties and/or the Agent might
be materially affected; or
(w) if for any reason the Vessel is not delivered to, and accepted
by, the Borrower under the Contract on or before 31st December
2000 and the Borrower has not established to the satisfaction of
the Majority Lenders that their interests are not adversely
affected.
10.02 The Agent may and if so requested by the Majority Lenders shall,
without prejudice to any other rights of the Lenders, at any time
after the happening of an Event of Default so long as the same is
continuing by notice to the Borrower declare that:
(a) the obligation of the Lenders to make any Advance to the Borrower
shall be terminated, whereupon the aggregate Commitment shall be
reduced to zero forthwith; and/or
(b) the Loan and all interest accrued and all other sums payable
under this Agreement and the Security Documents have become due
and payable, whereupon the same shall, immediately or in
accordance with the terms of such notice, become due and payable.
11. INDEMNITIES
11.01 The Borrower hereby undertakes and agrees to indemnify the Lenders and
the Agent on demand, without prejudice to any of the other rights of
the Lenders and the Agent under this Agreement and/or any of the
Security Documents, against any loss (including any breakage costs and
any loss incurred as a result of unwinding any interest rate swap
Page 34
arrangements contained in any Swap Agreement) or expense in excess of
any additional interest received by the Lenders and/or the Agent
pursuant to Clause 3.04 which the Lenders and/or the Agent shall
certify as sustained or incurred by it as a consequence of (i) any
default in payment by the Borrower of any sum under this Agreement or
any of the Security Documents when due, (ii) the occurrence of any
Event of Default, (iii) any prepayment of the Loan or part thereof
being made under Clauses 4.02, 4.03, 12.01, 12.02, or 12.03 otherwise
than on the last day of an Interest Period relating to the part of the
Loan prepaid or (iv) any Advance not being drawn down for any reason
(excluding any default by the Lenders and the Agent) after a Drawdown
Notice has been given, including, in any such case, but not limited
to, any loss or expense sustained or incurred in maintaining or
funding the Advance or any part thereof or in liquidating or
re-employing deposits from third parties acquired to effect or
maintain the Loan or any part thereof.
11.02 If any sum due from the Borrower under this Agreement or any of the
Security Documents or any order or judgment given or made in relation
hereto has to be converted from the currency ("the first currency") in
which the same is payable under this Agreement or the relevant
Security Document or under such order or judgment into another
currency ("the second currency") for the purpose of (i) making or
filing a claim or proof against the Borrower, (ii) obtaining an order
or judgment in any court or other tribunal or (iii) enforcing any
order or judgment given or made in relation to this Agreement or any
of the Security Documents, the Borrower shall indemnify and hold
harmless the Lenders and/or the Agent, as the case may be, from and
against any loss suffered as a result of any difference between (a)
the rate of exchange used for such purpose to convert the sum in
question from the first currency into the second currency and (b) the
rate or rates of exchange at which the Lenders and/or the Agent, as
the case may be, may in the ordinary course of business purchase the
first currency with the second currency upon receipt of a sum paid to
it in satisfaction, in whole or in part, of any such order, judgment,
claim or proof. Any amount due from the Borrower under this Clause
11.02 shall be due as a separate debt and shall not be affected by
judgment being obtained for any other sums due under or in respect of
this Agreement or any of the Security Documents and the term "rate of
exchange" includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency. Provided that there is no continuing Default and that the
Borrower has paid all amounts outstanding under this Agreement and the
Security Documents, any surplus arising from any exchange operation
referred to in this Clause 11.02 shall be promptly paid by the Agent
or the Lender concerned (as the case may be) to the Borrower or as it
may direct. If amounts remain outstanding under this Agreement and/or
the Security Documents, then any such surplus shall be paid by the
Agent or the Lender concerned to the Earnings Account (as defined in
the Collateral Agreement).
11.03 The Borrower shall not be obliged under this Clause 11 to indemnify
any Lender or the Agent against a loss or liability to the extent that
such loss or liability is a direct result of the wilful misconduct of
that Lender or the Agent, as the case may be.
12. UNLAWFULNESS, INCREASED COSTS, ALTERNATIVE INTEREST RATES
12.01 If any law, regulation or regulatory requirement or any judgment,
order or direction of any court, tribunal or authority binding upon
the Lenders in the jurisdiction in which they are respectively formed
or has their respective principal or lending office or in which any
action is required to be performed by them for the purposes of this
Agreement (whether or not in force before the date of this Agreement)
renders it unlawful for any Lender to make or maintain its Commitment
or maintain or fund the Loan or any part thereof or to carry out any
of its other obligations under this Agreement such Lender shall
promptly inform the Agent who shall forthwith inform the Borrower. If
it shall be so unlawful for any Lender to maintain or fund its
Page 35
Commitment or the Loan, the Agent shall, at the request and on behalf
of such Lender, shall give notice to the Borrower reducing such
Lender's Commitment to zero and/or requiring the Borrower to prepay
such Lender's Contribution by the latest date permitted by such law,
regulation, regulatory requirement, judgment, order or direction and
the Borrower shall prepay such Lender's Contribution in accordance
with and subject to the terms of such notice and the provisions of
Clause 12.04. Without prejudice to the obligation of the Borrower to
make such prepayment, the Borrower, the Agent and such Lender shall
negotiate in good faith for a period not exceeding thirty (30) days
with a view to such Lender making available its Commitment and/or
maintaining its Contribution in whole or part in a manner which is not
unlawful.
12.02 If any law, regulation or regulatory requirement or any judgment,
order or direction of any court, tribunal or authority binding upon
any Lender in the jurisdiction in which it is formed or has its
principal or lending office or in which any action is required to be
performed by it for the purposes of this Agreement taking effect after
the date of this Agreement or if compliance by such Lender with any
direction, request or requirement (whether or not having the force of
law) of any monetary agency, central bank or competent governmental or
other authority shall:
(a) subject such Lender to Taxes or change the basis of Taxation of
such Lender with respect to any payment under this Agreement
(other than Taxes or Taxation on the overall net income of such
Lender imposed in the jurisdiction in which its principal or
lending office under this Agreement is located); or
(b) impose, modify or deem applicable any reserve requirements or
require the making of any special deposits against or in respect
of any assets or liabilities of, deposits with or for the account
of, or loans by, such Lender; or
(c) impose on such Lender any other condition with respect to this
Agreement or its obligations under this Agreement,
and, as a result of any of the foregoing, the cost to such Lender of
making or keeping its Commitment available or maintaining or funding
its Contribution is increased or the amount payable or the effective
return to such Lender under this Agreement is reduced or such Lender
makes a payment or forgoes a return on or calculated by reference to
any amount payable to it under this Agreement, then and in each such
case:
(i) such Lender shall forthwith notify the Agent whereupon the Agent
shall forthwith notify the Borrower. The notification shall give
particulars in reasonable detail of the circumstances giving rise
to the event and of how such Lender may be affected;
(ii) without in any way limiting, reducing or otherwise qualifying the
obligations of the Borrower under this Agreement, such Lender
shall, in consultation with the Agent, endeavour to take such
reasonable steps as may be open to it to mitigate or remove such
circumstances including (without obligation) the transfer of its
rights and obligations under this Agreement to another of its
lending offices or an Affiliate, in each case not affected by the
relevant circumstances unless to do so might (in the opinion of
such Lender) be prejudicial to such Lender or be in conflict with
such ▇▇▇▇▇▇'s general banking policies or involve such Lender in
expense or an increased administrative burden;
Page 36
(iii)on demand the Borrower shall pay to the Agent for the account of
such Lender the amount which such Lender specifies (in a
certificate setting forth the basis of the computation of such
amount) is required to compensate such Lender for such increased
cost, reduction, payment or forgone return. The Borrower's
obligation to make any such payment shall be conditional upon the
Agent delivering to the Borrower with each such demand a
certificate from such Lender specifying in reasonable detail the
nature of the increased cost and the dates from which it applied;
and
(iv) the Borrower may, at any time after receipt of such demand and
certificate notify the Agent that it will prepay all (but not
part only) of such ▇▇▇▇▇▇'s Contribution to the Loan whereupon
the Borrower shall prepay an amount equal to such ▇▇▇▇▇▇'s
Contribution to the Loan in accordance with and subject to the
provisions of Clause 12.04.
Any demand under Clause 12.02 (iii) may be made at any time whether or
not the Loan has been repaid.
12.03 Clause 12.02 does not apply to, and no amount shall be recoverable
from the Borrower in respect of, any increased cost:
(a) which is compensated in full by the operation of Clause 6.07; or
(b) which is, or is attributable to, any Tax on the overall net
income or profits of the affected Lender.
12.04 (a) If and whenever, at any time prior to the commencement of any
Interest Period in respect of any Advance, the Agent shall have
determined (which determination shall, in the absence of manifest
error, be conclusive) that:
(i) adequate and fair means do not exist for ascertaining the
Floating Rate during such Interest Period pursuant to
Clause 3.02; or
(ii) deposits in Dollars are not available to the Lenders in the
London interbank market in sufficient amounts in the
ordinary course of business for such Interest Period; or
(iii) by reason of circumstances affecting the London interbank
market generally it is impracticable for the Lenders to
fund or continue to fund such Advance during such Interest
Period;
the Agent shall forthwith give notice (a "Determination Notice")
of such determination to the Borrower and to each of the Lenders.
After the giving of any Determination Notice the Commitment shall
not be borrowed until notice to the contrary is given by the
Agent to the Borrower.
Page 37
(b) During the period of ten (10) days after any Determination Notice
has been given by the Agent under Clause 12.04 (a), the Agent
shall certify (having consulted with the Borrower and the
Lenders) an alternative basis (the "Substitute Basis") for the
making or continuation of the Loan. The Substitute Basis may
(without limitation) include alternative interest periods,
alternative currencies or alternative rates of interest but shall
include a margin above the cost of funds to the Lenders
equivalent to the Margin. The Substitute Basis shall be binding
upon the Borrower and shall take effect in accordance with its
terms from the date specified in the Determination Notice. During
the period when a Substitute Basis is in force the Borrower, the
Agent and the Lenders shall consult not less frequently than once
every thirty (30) days with a view to reverting to the other
provisions of this Agreement as soon as practicable.
(c) If the Borrower determines that it does not wish to continue to
borrow the Loan on the basis of the Substitute Basis it shall so
notify the Agent within ten (10) days of receipt of the
certificate specifying such Substitute Basis, whereupon the
Borrower shall forthwith prepay the Loan in accordance with and
subject to the provisions of Clause 12.05 together with accrued
interest to the date of prepayment, calculated from the date
specified in the Determination Notice at a rate per annum equal
to the rate certified by the Agent to be an interest rate
equivalent to the aggregate of (a) the Margin and (b) the cost to
the Lenders of funding the Loan during the period commencing on
the date specified in the Determination Notice and ending on the
date of prepayment.
12.05 When the Loan is prepaid by the Borrower pursuant to this Clause 12
the Borrower shall, at the time of such prepayment, pay to the Agent
accrued interest thereon to the date of actual payment, any additional
amount payable under Clause 12.02 and all other sums payable by the
Borrower to the Agent and/or the Lenders pursuant to this Agreement
(including, without limitation, any amounts payable under Clause 11)
and pursuant to the Security Documents or any of them.
13. SECURITY AND SET-OFF
13.01 All moneys received by the Agent under or pursuant to this Agreement
or any of the Security Documents and expressed to be applicable in
accordance with the provisions of this Clause 13.01 shall be applied
by the Agent in the following manner:
(a) first in accordance with clause 8 of the Security Sharing
Agreement;
(b) secondly the surplus (if any) shall be paid to the Borrower or to
whomsoever else may be entitled to receive such surplus.
13.02 The Borrower hereby authorises the Lenders at any time following the
occurrence of a Default for so long as the same is continuing without
prejudice to any of the Lenders' rights at law, in equity or
otherwise, and without notice to the Borrower:
(a) to apply any credit balance standing upon any account of the
Borrower with any branch of the Lenders and in whatever currency
in or towards satisfaction of any sum due to the Lenders under
this Agreement and/or any of the Security Documents;
Page 38
(b) in the name of the Borrower and/or any of the Lenders to do all
such acts and execute all such documents as may be necessary or
expedient to effect such application; and
(c) to combine and/or consolidate all or any accounts in the name of
the Borrower with the Lenders.
For all or any of the above purposes the Lenders are authorised to
purchase with the monies standing to the credit of such account or
accounts such other currencies as may be necessary to effect such
application. The Lenders shall not be obliged to exercise any right
given to them by this Clause 13.02. The Lenders shall notify the
Borrower and the Agent forthwith upon the exercise or purported
exercise of any right of set-off giving full details in relation
thereto.
13.03 If at any time the proportion which any Lender has received or
recovered (whether by set-off or otherwise) in respect of its portion
of any sum due from the Borrower to the Lenders under this Agreement
(other than a sum received for the account of that Lender alone
pursuant to Clauses 6.07 or 12) is greater (the amount of the excess
being referred to in this Clause 13.03 as the "excess amount") than
the proportion of such sum received or recovered by the Lender
receiving or recovering the smallest or no proportion of its portion
of such sum:
(a) such Lender shall promptly notify the Agent and shall pay to the
Agent an amount equal to the excess amount and the Agent shall
notify the Borrower of receipt of such amount;
(b) the Agent shall treat such payment as if it were a payment by the
Borrower on account of the sum due to all the Lenders (including
the Lender to which the payment was made) to ensure that all the
Lenders share rateably (in accordance with their respective
Contributions to the Loan) in the benefit of such amount equal to
the excess amount; and
(c) as between the Borrower and such Lender the excess shall be
treated as not having been paid
Provided that:
(i) such Lender shall not be obliged to share any excess amount which
it receives as a result of or in connection with legal
proceedings which it takes to recover sums owing to it under this
Agreement with any other Lender which has a legal right to, but
does not, join in such proceedings (unless such proceedings are
instituted without prior notice having been given by such Lender
to the other Lenders through the Agent); and
(ii) if any part of the relevant receipt by such Lender is thereafter
required to be repaid to the Borrower, the other Lenders shall
repay to the Agent for the account of such Lender such amount as
shall be necessary to ensure that all the Lenders share rateably
(in accordance with their respective Contributions to the Loan)
in the amount of the receipt retained and the other provisions of
(b) and (c) above shall apply only to the retained amount.
13.04 The Borrower hereby undertakes that
(a) except insofar as enforcement may be limited by any applicable
laws relating to bankruptcy, insolvency, administration and
similar laws affecting creditors' rights generally, and except
insofar as stated in any qualification or reservation contained
in any original legal opinion given for the purpose of or as a
condition precedent to this Agreement, the Security Documents
shall both at the date of execution and delivery thereof and, so
long as any moneys are owing under this Agreement or thereunder,
be valid and binding obligations of the respective parties
thereto and rights of the Lenders and the Agent enforceable in
accordance with their respective terms; and
Page 39
(b) it will, at its own expense, execute, sign, deliver, register,
perfect and do and perform any and every such further mortgage,
charge, pledge, lien, hypothecation, assignment, security
interest, assurance, document, deed, instrument, act or thing as
in the reasonable opinion of the Agent may be necessary or
desirable for perfecting the security contemplated or constituted
by the Security Documents.
13.05 The Security Documents are supplemental to this Agreement and, in the
event of any conflict, the provisions of this Agreement shall prevail.
14. ASSIGNMENT AND LENDING OFFICES
14.01 This Agreement shall be binding upon, and enure for the benefit of,
the Lenders, the Agent and the Borrower and their respective
successors.
14.02 The Borrower may not assign or transfer any of its rights or
obligations under this Agreement.
14.03 Each Lender (an "existing Lender") may assign or transfer all or any
part of its rights, benefits and/or obligations under this Agreement
and the Security Documents to any one or more banks or other financial
institutions (in the case of an assignment, an "Assignee" and in the
case of a transfer a "Transferee"). Written notice of any assignment
of all or part of any Lender's rights and/or benefits under the
Agreement and the Security Documents shall be given to the Borrower
and the Agent as soon as possible after the same has been effected.
Any transfer of all or part of any Lender's obligations under this
Agreement before the Delivery Date may only be effected with the prior
written consent of the Borrower, such consent not to be unreasonably
withheld and the request for which shall be promptly responded to,
unless the Transferee shall be an Affiliate company of such Lender or
another existing Lender (in which case no such consent shall be
required, the Borrower consenting to such transfer by its execution of
this Agreement provided that, in the case of a transfer to a
subsidiary, the proposed Transferee shall be of substantially similar
financial standing to the existing Lender or that Lender shall remain
responsible for the performance of the Transferee's obligations). Any
such transfer shall be effected upon five (5) Banking Days' prior
notice by delivery to the Agent of a duly executed and duly completed
Transfer Certificate in which event, on the transfer date specified in
such Transfer Certificate, to the extent that they are expressed to be
the subject of the novation established by the Transfer Certificate:
(a) the Borrower, the existing Lender and the other parties to this
Agreement shall be released from further obligations towards one
another under this Agreement and the Security Documents in
respect of such transferred rights, benefits and/or obligations
and their respective rights against one another under this
Agreement and the Security Documents in respect of such
transferred rights, benefits and/or obligations shall be
cancelled (such rights and obligations being referred to in this
Clause 14.03 as "discharged rights and obligations"); and
(b) the Borrower, the Transferee and the other parties to this
Agreement shall assume obligations towards one another and/or
acquire rights against one another which differ from such
discharged rights and obligations only insofar as they are
exercisable by or against the Transferee in place of the existing
Lender.
The Agent shall promptly notify the other parties thereof of the
receipt by it of any Transfer Certificate and shall promptly deliver a
copy of such Transfer Certificate to the Borrower and the other
Lenders.
14.04 The Agent and the Borrower shall be fully entitled to rely on any
Transfer Certificate delivered to the Agent in accordance with the
foregoing provisions of this Clause 14 which is complete and regular
on its face as regards its contents and purportedly signed on behalf
of the existing Lender and the Transferee and neither the Agent or the
Borrower shall have any liability or responsibility to any party as a
consequence of placing reliance on and acting in accordance with any
such Transfer Certificate if it proves to be the case that the same
was not authentic or duly authorised.
Page 40
14.05 The Borrower and each Lender irrevocably undertakes and agrees to
counter-sign each Transfer Certificate promptly upon request by the
Agent subject to the terms of this Agreement.
14.06 If any Lender assigns all or any part of its rights or benefits or
transfers all or any part of its rights, benefits and/or obligations
as provided in Clause 14.03 or 14.04 the Borrower undertakes,
immediately on being requesting to do so by such Lender and at the
cost of such Lender to enter into such documents as may be necessary
or desirable to assign to the Assignee or transfer to the Transferee
all or the relevant part of such Lender's interest in this Agreement
and the Security Documents and all relevant references in this
Agreement to such Lender shall thereafter be construed as a reference
to such Lender and/or its Assignee and/or its Transferee (as the case
may be) to the extent of their respective interests and, in the case
of a transfer of all or part of such Lender's obligations, the
Borrower shall thereafter look only to the Assignee and/or the
Transferee (as the case may be) in respect of that proportion of such
▇▇▇▇▇▇'s obligations under this Agreement as corresponds to the
obligations assumed by such Assignee and/or Transferee (as the case
may be).
14.07 Each Lender shall lend through its branch set opposite its name in
Schedule 1 or through any other office of such Lender selected from
time to time by it through which such Lender wishes to lend for the
purposes of this Agreement provided that such Lender may not change
its lending office if such change shall have the effect of increasing
the costs incurred by the Borrower under or pursuant to this
Agreement. If the office through which such Lender is lending is
changed pursuant to this Clause 14.07, such Lender shall notify the
Agent and the Borrower promptly of such change.
14.08 Each Lender may grant or sell one or more participations in the whole
or any part of its rights in respect of its Contribution in such
manner and upon and subject to such terms and conditions as such
Lender, in its discretion, thinks fit, but so that any such
participation shall be on terms that the Borrower shall continue to
deal exclusively with such Lender, and not with the participant, with
whom the Borrower shall not have any contractual relationship, and
that such participant shall have rights and remedies only against such
Lender, and not against the Borrower.
14.09 Any Lender may, without the prior consent of the Borrower, disclose on
a confidential basis to a potential assignee or participant, or to any
other person who may propose entering into contractual relations with
such Lender in relation to this Agreement, such information about the
Borrower as such Lender shall consider appropriate.
14.10 The following additional provisions shall apply to each assignment of
rights and benefits, transfer of obligations (whether by way of
novation or otherwise) and change in lending office (as the case may
be) by a Lender made pursuant to this Clause 14:
(a) The Borrower's consent shall be obtained before any assignment or
transfer by any Lender where, under the relevant laws and
regulations in force at the time of the same, that ▇▇▇▇▇▇ is
aware that the Borrower would be obliged to pay for the account
of the relevant Transferee or Assignee (as the case may be), any
greater amount than it would have been obliged to pay had no such
assignment or transfer been made by that Lender.
(b) For avoidance of doubt, and without prejudice to the generality
of Clause 14.03 it shall be reasonable before the Delivery Date
for the Borrower to withhold its consent to any proposed transfer
by a Lender to a Transferee if the proposed Transferee is not of
substantially similar financial standing to the existing Lender
Provided that the Borrower shall not withhold such consent if the
existing Lender remains responsible for the performance of the
Transferee's obligations.
Page 41
15. THE AGENT AND THE LENDERS
15.01 The Borrower acknowledges that each ▇▇▇▇▇▇ has irrevocably appointed
the Agent as its agent for the purposes of this Agreement and each of
the Security Documents and authorised the Agent (whether or not by or
through employees or agents) to take such action on such ▇▇▇▇▇▇'s
behalf and to exercise such rights, remedies, powers and discretions
as are specifically delegated to the Agent by the Security Sharing
Agreement and the Security Documents, together with such powers and
discretions as are reasonably incidental thereto.
15.02 Except with the prior written consent of all of the Lenders, the Agent
shall not have authority on behalf of the Lenders to agree with the
Borrower any amendment to this Agreement or take any action which
would (i) reduce the Margin and/or waive the payment of or vary the
basis of calculation of any of the fees or interest payable by the
Borrower, (ii) extend the due date or reduce the amount of any payment
of principal, interest or other amount payable under this Agreement,
(iii) change the currency in which any amount is payable under this
Agreement, (iv) increase any Lender's Commitment or the aggregate of
all the Commitments, (v) postpone the last day of the Drawdown Period,
(vi) change this Clause 15.02, (vii) amend the definition of Majority
Lenders, (viii) change the provisions of Clause 9 or waive any of the
documents and evidence specified in Schedule 3, or (ix) result in the
release of any of the Security Documents.
15.03 The Borrower may rely upon any notice, instruction or other
communication sent by the Agent and shall be under no obligation to
enquire further whether it has been approved by, or requires the
approval of, the requisite Lenders.
16. NOTICES AND OTHER MATTERS
16.01 Every notice, request, demand or other communication under this
Agreement or (unless otherwise provided therein) under any of the
Security Documents shall:
(a) be in writing delivered personally or by first class prepaid
letter (airmail if available), telex, facsimile or cable
(confirmed in the case of a telex, facsimile or cable by
first-class prepaid letter sent within twenty four (24) hours of
despatch, but so that the non-receipt of such confirmation shall
not affect in any way the validity of the telex, facsimile or
cable in question);
(b) be deemed to have been received, subject as otherwise provided in
this Agreement or the relevant Security Document, in the case of
a telex at the time of despatch with confirmed answerback of the
addressee appearing at the beginning and end of the communication
(provided that if the date of despatch is not a business day 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), in the case of a facsimile at the time of despatch with
electronic or other confirmation of receipt (provided that if the
date of despatch is not a business day 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), in the case
of a cable twenty-four (24) hours after despatch and in the case
of a letter when delivered personally or seven (7) days after it
has been put in to the post; and
(c) be sent:
(1) if to be sent to the Borrower, to it care of:
▇▇▇▇▇▇-▇▇▇▇▇▇ Ltd.
Southside, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Telex: 917497 GOLAR G
Facsimile: 44 171 834 2259
Page 42
(2) if to be sent to the Agent, to it at:
45th Floor, One Exchange Square
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Telex: 85090 ISA HX
Facsimile: (▇▇▇) ▇▇▇▇ ▇▇▇▇
(3) if to be sent to the Lenders or any of them, to them at
their respective addresses, telex or facsimile numbers set
forth in Schedule 1;
or to such other address, telex or facsimile number as is notified
by one party to the other parties under this Agreement.
16.02 No failure or delay on the part of the Lenders or the Agent to
exercise any power, right or remedy under this Agreement and/or any of
the Security Documents shall operate as a waiver thereof, nor shall
any single or partial exercise by the Lenders or the Agent of any
power, right or remedy preclude any other or further exercise thereof
or the exercise of any other power, right or remedy. The remedies
provided in this Agreement and in the Security Documents are
cumulative and are not exclusive of any remedies provided by law.
16.03 All certificates, instruments and other documents to be delivered
under or supplied in connection with this Agreement or any of the
Security Documents shall be in the English language or shall be
accompanied by a certified English translation upon which the Lenders
and the Agent shall be entitled to rely.
16.04 Time shall be of the essence in the performance of the Borrower's
obligations under this Agreement and the Security Documents.
16.05 This Agreement may be executed in any number of counterparts and by
the different parties hereto on separate counterparts, each of which
so executed and delivered shall be an original, but all the
counterparts shall together constitute one and the same instrument.
16.06 Any provision of this Agreement prohibited by or becomes unlawful or
unenforceable under any applicable law actually applied by any court
of competent jurisdiction shall, to the extent required by such law,
be severed from this Agreement and rendered ineffective so far as is
possible without modifying the remaining provisions of this Agreement.
Where however the provisions of any such applicable law may be waived,
they are hereby waived by the parties hereto to the full extent
permitted by such law to the end that this Agreement shall be a valid
and binding agreement enforceable in accordance with its terms.
17. LAW AND JURISDICTION
17.01 This Agreement is governed by and shall be construed in accordance
with English law.
17.02 For the benefit of the Lenders and the Agent, the parties hereto
irrevocably agree that any legal action or proceedings in connection
with this Agreement against the Borrower or any of its assets may be
brought in the English courts which shall have jurisdiction to settle
any disputes arising out of or in connection with this Agreement. The
Borrower hereby irrevocably and unconditionally submits to the
jurisdiction of such courts and the Borrower irrevocably designates,
appoints and empowers HFW Nominees Limited (presently of ▇▇▇▇▇▇ House,
Lloyds Avenue, London, EC3N 3AL) at its registered office for the time
being in England 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 Agreement and
the Security Documents. Nothing in this Clause 17.02 shall affect the
right of the Lenders and the Agent to serve process in any other
manner permitted by law but if the said process agent ceases to exist
or have an office in the relevant jurisdiction where process may be
served, the Borrower shall forthwith appoint another process agent
Page 43
with an office in that jurisdiction where process may be served and
shall forthwith notify the Agent thereof. The submission to such
jurisdiction shall not (and shall not be construed so as to) limit the
right of the Lenders and/or the Agent to take proceedings against the
Borrower in any other court of competent jurisdiction nor shall the
taking of proceedings in any one or more jurisdictions preclude the
taking of proceedings in any other jurisdiction, whether concurrently
or not.
17.03 The Borrower waives any objection it may now or hereafter have to the
laying of venue of any legal action or proceeding arising out of or in
connection with this Agreement or any of the Security Documents in any
court and any claim it may now or hereafter have that any such legal
action or proceeding has been brought in an inconvenient forum.
17.04 The Borrower waives any rights of sovereign immunity which it or any
of its properties may enjoy in any jurisdiction and subjects itself to
civil and commercial law with respect to its obligations under this
Agreement and the Security Documents.
IN WITNESS whereof the parties hereto have caused this Agreement to be duly
executed the day and year first above written.
Page 44
THE BORROWER
------------
SIGNED by )
)
for and on behalf of FARAWAY )
)
MARITIME SHIPPING COMPANY )
THE LEAD ARRANGER
-----------------
SIGNED by )
)
for and on behalf of )
)
THE BANK OF TAIWAN )
THE ARRANGERS
-------------
SIGNED by )
)
for and on behalf of )
)
CREDIT AGRICOLE INDOSUEZ )
SIGNED by )
)
for and on behalf of )
)
THE FUJI BANK, LIMITED )
)
Page 45
SIGNED by )
)
for and on behalf of )
)
THE INDUSTRIAL BANK OF )
JAPAN, LIMITED )
SENIOR MANAGER
--------------
SIGNED by )
)
for and on behalf of )
)
CREDIT LYONNAIS, OFFSHORE ))
)
BANKING UNIT, TAIPEI )
THE LENDERS
-----------
SIGNED by )
)
for and on behalf of )
)
BANK OF TAIWAN )
SIGNED by )
)
for and on behalf of )
)
CREDIT AGRICOLE INDOSUEZ )
Page 46
SIGNED by )
)
for and on behalf of )
)
THE FUJI BANK, LIMITED )
)
SIGNED by )
)
for and on behalf of )
)
THE INDUSTRIAL BANK OF )
JAPAN, LIMITED )
SIGNED by )
)
for and on behalf of )
)
CREDIT LYONNAIS, OFFSHORE )
)
BANKING UNIT, TAIPEI )
THE AGENT
---------
SIGNED, SEALED and DELIVERED )
)
by for and on behalf of INDOSUEZ)
)
ASIA SHIPFINANCE SERVICES )
)
LIMITED in the presence of: )
Page 47
SCHEDULE 1
The Lenders
Lenders Commitment
------- ----------
THE BANK OF TAIWAN $60,000,000
Singapore Branch
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ #▇▇-▇▇
▇▇▇ ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Telex: 24835 BOTSIN
Facsimile: (▇▇) ▇▇▇ ▇▇▇▇
CREDIT AGRICOLE INDOSUEZ $46,500,000
9, Quai du President ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Telex: 650409 INSU X
Facsimile: (▇▇ ▇) ▇▇ ▇▇ ▇▇ ▇▇
THE FUJI BANK, LIMITED $46,500,000
Singapore Branch
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ #▇▇-▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
Telex: RS24610 FUJIGIN
Facsimile: 65 438 5997
THE INDUSTRIAL BANK OF JAPAN, LIMITED $46,500,000
3-3, Marunouchi ▇-▇▇▇▇▇
▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
Telex: J22325: Answerback KOGIN J
Facsimile: ▇▇-▇-▇▇▇▇-▇▇▇▇
Atten: Corporate Banking Department No.5
CREDIT LYONNAIS, $15,000,000
OFFSHORE BANKING UNIT, TAIPEI
16th Floor, ▇▇▇▇ ▇▇▇ Building
▇▇▇, ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇
Telex: 10304 CREDTPE
Facsimile: (▇▇▇▇) ▇▇▇ ▇▇▇▇
Page 48
SCHEDULE 2
Form of Drawdown Notice
To: Indosuez Asia Shipfinance Services Limited ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Date: 199
US$[214,500,000] Loan Facility
Agreement dated 1997
We refer to the above Agreement and hereby give you notice that we
wish to drawdown an Advance in the sum of Dollars [ ] on ............ 19 . The
funds should be credited to [name and number of account] with [ ] for the
purpose of [paying the [ ] instalment of the Contract Price to the Builder.]
We confirm that:
(i) no event or circumstance has occurred and is continuing which
constitutes a Default;
(ii) the representations and warranties contained in Clause 7.01 of
the above Agreement are on the date hereof or, to the extent they
are not, will be on the Drawdown Date [or, in the case of the
Advance to be made on the Delivery Date, to the extent that they
are not, will be on the Delivery Date], true and correct;
(iii)the acceptance of the Commitment [and the borrowing of the
Advance] will be within our corporate powers, has been validly
authorised by appropriate corporate action and will not cause any
limit on our borrowings (whether imposed by statute, regulation,
agreement or otherwise) to be exceeded.
Words and expressions defined in the Agreement shall have the same
meanings when used herein.
For and on behalf of
FARAWAY MARITIME SHIPPING COMPANY
By:
-------------------------------
Name:
Title:
Page 49
SCHEDULE 3
List of Documents and evidence
Part 1
(a) a copy, certified as a true and complete copy by an officer of the
Borrower of the Articles of Incorporation and By-laws of the Borrower
and an up-to-date list of the directors and officers of the Borrower;
(b) a copy, certified as a true and complete copy by a director, the
secretary or the assistant secretary of each of the Chargors and the
Manager, of the constitutional documents of such ▇▇▇▇▇▇▇ and the
Manager and an up-to-date list of the directors and officers of such
▇▇▇▇▇▇▇ and the Manager;
(c) a certificate of resolutions of the Board of Directors of the Borrower
approving the acceptance of this facility and the borrowing of the
Loan and approving and authorising a person or persons to execute this
Agreement, the Collateral Agreement, the Contract Assignment, the
Charter Assignment, the Guarantee and Swap Receipts Assignment, the
General Assignment, the Management Contracts Assignment, the Mortgage
and each of the other Relevant Documents to which it is a party;
(d) a certificate of resolutions of the Board of Directors of each Chargor
approving and authorising a person or persons to execute the Deed of
Charge and each of the other Relevant Documents to which it is a
party;
(e) a certificate of resolutions of the Board of Directors of each of the
Manager and the Sub-manager approving and authorising a person or
person to execute the Management Contracts Assignment (in the case of
the Manager) and each of the other Relevant Documents to which it is a
party;
(f) a certificate of resolutions of Board of Directors of each issuer of
the Letters of Undertaking (other than PT Graha Centermine) and a
copy, certified as a true and complete copy by a director, the
secretary or the assistant secretary of each issuer of the Letters of
Undertaking, of the constitutional documents of the issuer and an
up-to-date list of the directors and officers of each issuer;
Page 50
(g) a copy, certified as a true and complete copy by an officer of the
Borrower of all consents, authorisations, licences and approvals
required by the Borrower, the Chargors and any other party thereto
other than the Lenders and the Agent (or, in the absence of such
copies, a legal opinion establishing that such consents,
authorisations, licences and approvals have been obtained or
alternatively that there are no consents necessary), in connection
with the execution, delivery, validity and enforceability of this
Agreement and the Relevant Documents (other than the Sales Contract
and the Trustee and Paying Agent Agreement), and the performance by
the Borrower, the Chargors and such other parties of, their respective
obligations hereunder and thereunder, for the Borrower to borrow the
Loan, and for the Borrower to pay the principal of and interest on the
Loan and all other sums payable under this Agreement;
(h) copies, certified as a true and complete copies by an officer of the
Borrower of the Contract, the Shareholders' Agreement, the Management
Agreement, the Sub-management Agreement and the Charter, and copies of
the Sales Contract and the Trustee and Paying Agent Agreement;
(i) the original Performance Bond and the Refund Guarantee in respect of
the first instalment of the Contract Price;
(j) the Security Sharing Agreement, Contract Assignment, the Management
Contracts Assignment and the Guarantee and Swap Receipts Assignment
all duly executed, together with the consents and acknowledgements
annexed thereto duly executed by the Builder, the Manager, the
Sub-manager and the Bank Guarantors in respect of the Contract, the
Management Agreement, the Sub-management Agreement, the Performance
Bond and the first Refund Guarantee respectively;
(k) the Deed of Charge, duly executed by the Chargors and all the relevant
documents pursuant thereto;
(l) the Charter Assignment, duly executed by the Borrower, together with
the Charterer's Consent duly executed by the Charterer;
(m) the Collateral Agreement, duly executed by the Borrower and the
Trustee;
(n) the Letters of Undertaking and the Good Management Undertaking, each
duly executed;
(o) the Fee Letter, duly executed by the Borrower and the Agent and the
Trustee Fee Letter duly executed by the Trustee and the Borrower;
(p) a copy, certified as a true copy by an officer of the Borrower of a
letter from HFW Nominees Limited accepting its appointment as agent
for receipt of service of proceedings under Clause 17.02 and under
each of the Security Documents in which it is or is to be appointed as
the agent of the Borrower and any other parties to the Security
Documents;
Page 51
(q) such satisfactory legal opinions of legal advisers as the Lenders and
the Agent shall require, which legal opinions shall extend (without
limitation) to the Borrower, the Chargors, the issuers of the Letters
of Undertaking, the Charterer and any other parties considered by the
Agent to be relevant;
(r) a copy, certified as a true copy by an officer of the Borrower of the
receipt for payment of the first (1st) instalment of the Contract
Price specified under Section 8.2(a) of the Contract;
(s) (save in respect of an Advance made available pursuant to Clause
2.01(b)) evidence, satisfactory to the Agent in all aspects, that the
Chargors shall have maintained or, if necessary, contributed further
equity to the Borrower so that, after the first Advance, the
Debt/Equity ratio of the Borrower shall be not more than 78:22;
(t) the Swap Agreement, Schedule thereto and each Confirmation (as defined
therein), duly executed by the Borrower and each Counterparty thereto
or, if the Borrower chooses not to enter into sufficient Swap
Agreements with Counterparties to hedge the Borrower's exposure to
interest rate fluctuations hereunder, evidence satisfactory to the
Agent that the Borrower has entered into Additional Swap Agreements
(i) with banks or financial institutions acceptable to the Arrangers,
(ii) with a term of at least six (6) years and six (6) months from the
Delivery Date, (iii) on terms with dates and amounts matching the
Borrower's interest payment obligations under this Agreement, and (iv)
with an applicable interest rate of not more than eight point five per
centum per annum (8.5% p.a.);
(u) the certificates and documentation set out in Part 3 of Schedule 1 to
the Swap Agreement;
(v) a certified copy of the Deed of Guarantee issued by Osprey Maritime
Limited to the Charterer under the Charter;
(w) an opinion satisfactory to the Agent from BANKASSURE Insurance
Services Limited confirming that the requirements set out in the
Security Documents relating to the Insurances (as defined in the
General Assignment) are appropriate (taking into account both market
practice and the method of financing the Vessel);
(x) the notice specified in Clause 6.02 of the Collateral Agreement, duly
executed by the Borrower, the Charterer and Bank of America National
Trust and Savings Association, New York Branch; and
Page 52
(y) a financial statement, certified by the Borrower to be true and
correct and prepared in accordance with generally accepted accounting
principles and practices in the United States of America consistently
applied, reflecting variation between (i) actual expenditure to the
date of such financial statement by the Borrower in relation to Total
Project Cost and (ii) budgeted expenditure in relation to Total
Project Cost, such budgeted expenditure as approved by the Agent
before drawdown of the first Advance under this Agreement.
Part 2
(a) (i) Certified true copies of the Contractor's invoice under Section
8.2 of the Contract evidencing that the instalment of the
Contract Price specified in the relevant Drawdown Notice is due
and each of the other documents to be produced by the Builder in
respect thereof; and
(ii) the original Refund Guarantee in respect of such instalment of
the Contract Price and the Bank Guarantor's consent and agreement
to the assignment thereof under and in accordance with the terms
of the Guarantee and Swap Receipts Assignment; or
(b) Evidence, satisfactory to the Agent in all respects, of the purpose
for which the Advance is being made and that the payment to which it
relates is due;
(c) Evidence, satisfactory to the Agent in all respects, that the Chargors
shall have contributed further equity to the Borrower so that, after
the relevant Advance, the Debt/Equity ratio of the Borrower shall be
not more than 78:22; and
(d) a financial statement, certified by the Borrower to be true and
correct and prepared in accordance with generally accepted accounting
principles and practises in the United States of America consistently
applied, reflecting variation between (i) actual expenditure by the
Borrower to the date of such financial statement in relation to Total
Project Cost and (ii) budgeted expenditure in relation to Total
Project Cost, such budgeted expenditure as approved by the Agent
before drawdown of the first Advance under this Agreement.
Part 3
(a) copies, certified to be true copies by a director of the Borrower, of
all documents which the Agent may reasonably require evidencing that
all necessary action, approvals, consents or authorisations with
respect to or in connection with the registration of the Vessel under
the laws and flag of the Republic of Liberia have been taken or
obtained;
Page 53
(b) certified true copies of the Contractor's invoice under Section 8.2(e)
of the Contract evidencing that the final instalment is due under the
Contract;
(c) documentary evidence:
(i) that (if applicable) the Government of Japan has granted an
export licence in respect of the sale of the Vessel to the
Borrower and that such export licence is in full force and effect
as of such date;
(ii) that there is no lien, charge or encumbrance of any kind
whatsoever on the Vessel, her earnings or insurance, (save and
except for the Contractor's and the Builder's right to retain the
Vessel until paid for in accordance with the Contract), it being
understood that the declaration referred to in Section 17.3(a)(v)
of the Contract will be sufficient documentary evidence;
(iii)that the Vessel has been duly completed and will be accepted by
the Borrower on the Delivery Date as being in all respects in
accordance with the Contract;
(d) a financial statement, certified by the Borrower to be true and
correct and prepared in accordance with generally accepted accounting
principles and practises in the United States of America consistently
applied, reflecting variation between (i) actual expenditure to the
date of such financial statement in relation to Total Project Cost by
the Borrower and (ii) budgeted expenditure in relation to Total
Project Cost, such budgeted expenditure as approved by the Agent
before drawdown of the first Advance under this Agreement;
(e) a certificate from the Secretary of the Borrower confirming that each
of the resolutions referred to in the certificate described in
paragraph (c) of Part 1 of this Schedule remain in full force and
effect and have not (except as consented to by the Agent) been
amended, modified or revoked in any respect;
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(f) an opinion satisfactory to the Agent from BANKASSURE Insurance
Services Limited confirming that the Insurances actually obtained by
the Borrower conform with the requirements of this Agreement and the
Security Documents; and
(g) evidence, satisfactory to the Agent in all respects, that the total
of all Advances made or to be made under this Agreement will not
exceed seventy eight per centum (78%) of Total Project Cost, save as
expressly envisaged by Clause 2.01(b).
Part 4
(a) evidence that the Vessel:
(i) has been completed, delivered to and accepted by the Borrower
under the Contract;
(ii) is registered in the name of the Borrower under the laws and flag
of the Republic of Liberia free of Encumbrances other than
Permitted Encumbrances;
(iii) is classed in accordance with Clause 7.01(k) of this Agreement;
(iv) is insured in accordance with the provisions of the Mortgage and
the General Assignment and all requirements of the Mortgage and
the General Assignment in respect of such insurance have been
complied with; and
(v) that the Vessel has been accepted by the Charterer under the
Charter;
(b) the Mortgage and the General Assignment and all documents to be
delivered pursuant thereto, each duly executed by the Borrower and the
executed notices pursuant to the General Assignment;
(c) evidence that the Mortgage has been registered against the Vessel
through the Office of the Deputy Commissioner of Maritime Affairs of
the Republic of Liberia;
(d) the Bank Guarantee, duly executed by the relevant Bank Guarantor, and
the consent and agreement of such Bank Guarantor to the assignment of
the Bank Guarantee under and in accordance with the terms of the
Guarantee and Swap Receipts Assignment;
Page 55
(e) a notice from the Borrower specifying the Total Project Cost, such
notice to be supported by documentation (including invoices, receipts
and other evidence reasonably requested by the Agent) in form and
substance acceptable to the Agent;
(f) a financial statement, certified by the Borrower to be true and
correct and prepared in accordance with generally accepted accounting
principles and practices in the United States of America consistently
applied, reflecting variation between actual expenditure by the
Borrower in relation to Total Project Cost and budgeted expenditure,
such budgeted expenditure as approved by the Agent before drawdown of
the first Advance under this Agreement.
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SCHEDULE 4
No. of Date of Principal
payment payment Repayment
------- ------- ---------
1 28-Jun-01 $4,979,515
2 28-Dec-01 $5,191,145
3 28-Jun-02 $5,411,768
4 28-Dec-02 $5,641,768
5 28-Jun-03 $5,881,544
6 28-Dec-03 $6,131,509
7 28-Jun-04 $6,392,098
8 28-Dec-04 $6,663,763
9 28-Jun-05 $6,946,972
10 28-Dec-05 $7,242,219
11 28-Jun-06 $7,550,013
12 28-Dec-06 $7,870,889
13 28-Jun-07 $8,205,401
14 28-Dec-07 $8,554,131
15 28-Jun-08 $8,917,682
16 28-Dec-08 $9,296,683
17 28-Jun-09 $9,691,792
18 28-Dec-09 $10,103,693
19 28-Jun-10 $10,533,100
20 28-Dec-10 $10,980,757
21 28-Jun-11 $11,447,439
22 28-Dec-11 $11,933,955
23 28-Jun-12 $12,441,148
24 28-Dec-12 $12,969,897
25 28-Jun-13 $13,521,119
------------
$214,500,000
------------
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SCHEDULE 5
Form of Transfer Certificate
(referred to in Clause 14.03)
To: [ ]
From: Indosuez Asia Shipfinance Services Limited (the "Agent") and [Name of
Transferee]
US$214,500,000 Financial Agreement dated [ ] (the "Agreement")
Loan Transfer Certificate
1. [ ] (the "existing Lender") (a) confirms the accuracy of the summary of its
participation in the Loan under the Agreement set out in the Schedule
below; and (b) requests [Name of transferee] (the "Transferee") to accept
and procure the novation of the portion of such participation specified in
the Schedule below by counter-signing and delivering this Transfer
Certificate to the Agent at its address for the services of notices
specified in the Agreement.
2. The Transferee hereby requests the Agent (on behalf of itself and the
Lenders) and the Borrower to accept this Transfer Certificate as being
delivered to the Agent:
(a) pursuant to and for the purposes of Clause 14.03 of the Agreement
so as to take effect as a novation of the rights and obligations
of the existing Lender to the extent of the portion of the
existing Lender's participation referred to in paragraph 1 above
in accordance with the terms of such Clause 14.03 on *[date of
transfer] (the "Transfer Date"); and
(b) pursuant to and for the purposes of Clause 11.01 of the Security
Sharing Agreement (as defined in the Financial Agreement) so as
to take effect as a novation of the rights and obligations of the
existing Lender to the extent of the portion of the existing
Lender's participation referred to in paragraph 1 above in
accordance with the terms of such Clause 11.01 on the Transfer
Date.
*Note- To be not earlier than five (5) Banking Days after the date of
delivery of this Transfer Certificate to the Agent.
3. The Transferee confirms that:
(a) it has received a copy of the Agreement, the Security Sharing
Agreement and all other documentation and information required by
it in connection with the transactions contemplated by this
Transfer Certificate;
Page 58
(b) it has not relied on any statement, opinion, forecast or other
representation made by the Agent to induce it to execute this
Transfer Certificate and has made, without reliance on the Agent
and based on such documents as it considers appropriate, its own
appraisal of the creditworthiness of the Borrower and its own
independent investigation of the financial condition and affairs
of the Borrower in connection with the assumption by the
Transferee of its obligations arising under or by virtue of this
Transfer Certificate.
4. The existing Lender makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Agreement, the Security Sharing
Agreement, any of the Security Documents or any document relating thereto
and assumes no responsibility for the financial condition of the Borrower
or any other party to the Agreement or for the performance and observance
by the Borrower or any other such party of any of its obligations under the
Agreement, the Security Sharing Agreement, any of the other Security
Documents, or any document relating thereto and any and all such conditions
and warranties, whether express or implied by law or otherwise, are hereby
excluded.
5. This Transfer Certificate and the rights and obligations of the parties
hereunder are governed by and shall be construed in accordance with English
law.
Page 59
SCHEDULE
1. The existing Lender's participation in the Loan
(a) The existing Lender's Loan
Commitment/Percentage $ ....... %.......
(b) The existing Lender's Contribution $ .......
to the Loan
2. The portion of the amounts in 1 above to be novated
(a) $ ....... % .......
(b) $ .......
Administrative Details of Transferee
Lending Office:
--------------------------------------
Account for payments:
--------------------------------------
Telex:
--------------------------------------
Attention:
------------------------------------------------
The Transferor The Transferee
[ ] [Name of Transferee]
By: By:
Date: Date:
------------------------- --------------------------
The remaining Lenders
By: By:
Date: Date:
------------------------- --------------------------
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The Agent
Indosuez Asia Shipfinance Services Limited
By: By:
Date: Date:
------------------------- --------------------------
The Borrower
Faraway Maritime Shipping Company
By: By:
Date: Date:
------------------------- --------------------------
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