Exhibit 10.2
Execution Copy
FACILITY AGREEMENT
for a
U.S.$275,000,000 Facility
to
STENA INTERNATIONAL B.V.
provided by
THE CHASE MANHATTAN BANK
(OR A SUCCESSOR OR NOMINATED AFFILIATE THEREOF)
NORDBANKEN AB (PUBL)
SVENSKA HANDELSBANKEN AB (PUBL)
HSBC BANK PLC
LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
DEN NORSKE BANK ASA
SCOTIABANK EUROPE PLC
SKANDINAVISKA ENSKILDA ▇▇▇▇▇▇ ▇▇ (PUBL)
ABN AMRO BANK N.V.
NEDSHIP BANK (NORDIC)
arranged by
▇. ▇. ▇▇▇▇▇▇ PLC
NORDBANKEN AB (PUBL)
SVENSKA HANDELSBANKEN AB (PUBL)
Agent
SVENSKA HANDELSBANKEN AB (PUBL)
Security Agent
SVENSKA HANDELSBANKEN AB (PUBL)
Documentation Agents
NORDBANKEN AB (PUBL)
SVENSKA HANDELSBANKEN AB (PUBL)
guaranteed by
STENA ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Ref: JEF/90034685
CONTENTS
CLAUSE CONTENTS PAGE
1. PURPOSE AND DEFINITIONS....................................................................1
2. THE COMMITMENTS...........................................................................45
3. ADVANCES..................................................................................46
4. INTEREST ON ADVANCES......................................................................47
5. REPAYMENT, REDUCTION AND CANCELLATION.....................................................50
6. FEES, COMMISSION, MARGIN AND EXPENSES.....................................................61
7. PAYMENTS AND TAXES; ACCOUNTS AND CALCULATIONS.............................................64
8. GUARANTEE AND INDEMNITY...................................................................68
9. REPRESENTATIONS AND WARRANTIES............................................................71
10. UNDERTAKINGS..............................................................................76
11. SHIP AND LINKSPAN COVENANTS : INSURANCE...................................................98
12. SHIP AND LINKSPAN COVENANTS : OPERATION AND MAINTENANCE..................................105
13. COVENANTS IN RESPECT OF THE PORTS........................................................110
14. CONDITIONS...............................................................................115
15. DEFAULT..................................................................................116
16. INDEMNITIES..............................................................................119
17. UNLAWFULNESS AND INCREASED COSTS.........................................................121
18. SET-OFF AND PRO-RATA PAYMENTS............................................................123
19. SECURITY.................................................................................125
20. ASSIGNMENT, TRANSFER AND LENDING OFFICE..................................................131
21. REFERENCE BANKS, CO-ARRANGERS, AGENT AND SECURITY AGENT..................................135
22. NOTICES AND OTHER MATTERS................................................................147
23. GOVERNING LAW AND JURISDICTION...........................................................149
SCHEDULES
SCHEDULE 1 THE BANKS AND THEIR COMMITMENTS
SCHEDULE 2 THE SHIPS
SCHEDULE 3 COMMERCIAL DOCUMENTS
SCHEDULE 4 FORM OF DRAWDOWN NOTICE
SCHEDULE 5 CONDITIONS PRECEDENT
SCHEDULE 6 FORM OF TRANSFER CERTIFICATE
SCHEDULE 7.1 FORM OF SHIPOWNER'S GUARANTEE
SCHEDULE 7.2 FORM OF PORT OWNER'S GUARANTEE
SCHEDULE 8 FORM OF SWEDISH MORTGAGES
SCHEDULE 9 FORM OF INSURANCE ASSIGNMENT
SCHEDULE 10 FORM OF STATUTORY MORTGAGE NARRATIVE
SCHEDULE 11.1 FORM OF DEED OF COVENANT
SCHEDULE 11.2 FORM OF DEED OF COVENANT
(M.V. "STENA CARISMA" AND HER RELATED LINKSPANS)
SCHEDULE 12 FORM OF CHARTERER'S INSURANCE ASSIGNMENT
SCHEDULE 13 FORM OF CHARTERER'S SUBORDINATION UNDERTAKING
SCHEDULE 14 FORM OF HOLYHEAD CHARGE
SCHEDULE 15 FORM OF STRANRAER CHARGE
SCHEDULE 16 FORM OF RECEIVABLES ASSIGNMENT (CREDIT SALE)
SCHEDULE 17 FORM OF RECEIVABLES ASSIGNMENT (HIRE PURCHASE)
SCHEDULE 18 FORM OF MANAGER'S SUBORDINATION UNDERTAKING
SCHEDULE 19 FORM OF STENA GERMANICA ASSIGNMENT
SCHEDULE 20 SPECIMEN CHARTER COVENANTS AND LOSS PAYABLE CLAUSES
SCHEDULE 21 FORM OF ASSET COVERAGE COMPLIANCE CERTIFICATE
THIS AGREEMENT is dated 2001 and is made BETWEEN:-
(1) STENA INTERNATIONAL B.V. as Borrower;
(2) ▇. ▇. ▇▇▇▇▇▇ PLC, NORDBANKEN AB (PUBL) AND SVENSKA HANDELSBANKEN AB
(PUBL) as Co-Arrangers (for whom Nordbanken AB (publ) and Svenska
Handelsbanken AB (publ) act as Documentation Agents);
(3) the banks and financial institutions whose names and addresses are set
out in Schedule 1 as Banks;
(4) SVENSKA HANDELSBANKEN AB (PUBL) as Agent;
(5) SVENSKA HANDELSBANKEN AB (PUBL) as Security Agent; and
(6) STENA AB as guarantor.
IT IS AGREED as follows:-
1. PURPOSE AND DEFINITIONS
1.1 Purpose
This Agreement sets out the terms and conditions upon and subject to
which the Banks agree, according to their several obligations, to make
available to the Borrower a multipurpose corporate facility of up to
$275,000,000 to be used for the purpose of enabling the Borrower partly
to refinance the Stena Line Revolving Credit Facility.
1.2 Definitions
In this Agreement, unless the context otherwise requires:-
"ABN STANDBY FACILITY AGREEMENT"
means the facility agreement dated 2001 made between Stena Line
Scandinavia as borrower and ABN AMRO Bank N.V. as lender pursuant to
which ABN AMRO Bank N.V. has agreed to make available to Stena Line
Scandinavia an unsecured standby and overdraft facility in the amount
of $10,000,000 to be applied partly towards refinancing the existing
indebtedness of Stena Line in respect of certain standby facilities
provided to it under the Stena Line Revolving Credit Facility;
"ADVANCE"
means each borrowing of a proportion of the Commitments by the Borrower
under Clause 3 or (as the context may require) the principal amount of
such borrowing for the time being outstanding;
"AFFILIATE"
of any specified person means any other person directly or indirectly
controlling or controlled by or under direct or indirect common control
with any specified person and "AFFILIATES" of Stena AB or any of its
Subsidiaries includes, without limitation, any Subsidiary of Stena AB
(other than a Wholly Owned Subsidiary of Stena AB) and any Unrestricted
Subsidiary so that neither Stena AB nor any Wholly Owned
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Subsidiary of Stena AB shall be deemed an "AFFILIATE" of Stena AB or
any Wholly Owned Subsidiary of Stena AB;
"AGENT"
means Svenska Handelsbanken AB (publ) or such other person as may be
appointed agent for the Banks, the Co-Arrangers and the Security Agent
pursuant to this Agreement;
"APPROVED BROKERS"
means, in relation to a Ship or Linkspan, such firm of insurance
brokers (if any), appointed by the relevant Shipowner as may from time
to time be approved in writing by the Agent for the purposes of this
Agreement (such approval not to be unreasonably withheld or delayed);
"APPROVED FLAG STATE"
has the meaning attributed thereto in Clause 19.5(I);
"APPROVED MANAGER"
means, in relation to a Ship or Linkspan, Northern Marine Management
Limited and/or any other member of the Stena AB Group or such other
manager as may be approved by the Agent (such approval not to be
unreasonably withheld or delayed) and includes any manager or
sub-manager to whom Northern Marine Management Limited or other
applicable member of the Stena AB Group or other manager so approved
may delegate all or part of its management functions on terms, inter
alia, that the manager so delegating such functions remains wholly
responsible as principal to the relevant Shipowner or demise charterer
in respect of the Ship or Linkspan for the purposes of the relevant
management functions;
"ASSET COVERAGE COMPLIANCE CERTIFICATE"
means the Officer's Certificate to be delivered by Stena AB pursuant
to Clause 10.2(F);
"ASSET DISPOSITION"
by any person means any transfer, conveyance, sale (including any
instalment sale or similar arrangement but excluding any sale pursuant
to a Sale and Leaseback Transaction), lease (other than pursuant to a
charter or operating lease of a Vessel in the ordinary course of
business) or other disposition by such person or any of its
Subsidiaries (including a consolidation or merger or other sale of any
such Subsidiary with, into or to another person in a transaction in
which such Subsidiary ceases to be a Subsidiary, but excluding a
disposition by a Subsidiary of such person to such person or a
Subsidiary of such person or by such person to a Subsidiary of such
person) (collectively, a "TRANSFER") of:-
(A) shares of Capital Stock (other than directors' qualifying
shares and other than pledges permitted under Clause 10.6) or
other ownership interests of a Subsidiary of such person;
(B) all or substantially all of the assets representing a
division or line of business of such person or any of its
Subsidiaries;
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(C) a Vessel; or
(D) other assets or rights of such person or any of its
Subsidiaries outside of the ordinary course of business
but solely for the purposes of Clause 10.7, the term "ASSET
DISPOSITION" shall not include:-
(i) any transfers of properties or assets which in the aggregate
do not exceed $5,000,000 in any fiscal year of Stena AB;
(ii) any transfer of any properties or assets to an Unrestricted
Subsidiary permitted to be made under Clause 10.6 and Section
10.22 (LIMITATION ON UNRESTRICTED SUBSIDIARIES) of each of the
Indentures or any corresponding provision in documentation
evidencing the terms of any Successor Financing;
(iii) the exchange of Capital Stock of a person for Capital Stock of
a different class of such person ranking at least pari passu
with the Capital Stock being so exchanged as to the payment of
dividends or as to the distribution of assets upon any
voluntary or involuntary liquidation, dissolution or winding
up of such person, provided that the Fair Market Value of the
shares received in such exchange is not less than that of the
Capital Stock to be surrendered in such exchange; and
(iv) any sale or transfer pursuant to an arrangement with any
lessor, lender, obligee or investor or to which such lessor,
lender, obligee or investor is a party providing for the
leasing or renting by such person of any property or asset of
such person which has been or is being sold or transferred by
such person two hundred and seventy (270) days or less after
the acquisition thereof, to such lessor, lender, obligee or
investor or to any person to whom funds have been or are to be
advanced by such lessor, lender, obligee or investor on the
security of such property or asset;
"AUDITED STENA AB FINANCIAL STATEMENTS"
means the consolidated audited annual financial statements of the Stena
AB Group and any other entities required to be consolidated in such
statements in accordance with any applicable laws;
"AUDITED STENA INTERNATIONAL FINANCIAL STATEMENTS"
means the consolidated audited annual financial statements of the Stena
International Group and any other entities required to be consolidated
in such statements in accordance with any applicable laws;
"AVAILABILITY DATE"
means the first date upon which the conditions referred to in Clauses
14.1 and 14. shall have been fulfilled;
"AVAILABILITY PERIOD"
means the period from the Availability Date and ending on the
Termination Date or the period ending on such earlier date (if any) (i)
on which the Borrower cancels all of
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the Commitments under Clause 5.8 or (ii) on which the Commitments of
all the Banks are reduced to zero pursuant to Clauses 5.3, 5.6,
5.7,15.2 or 17.1;
"AVAILABLE COMMITMENT"
means, in relation to a Bank, the amount of its Commitment less the
amount of its Contribution;
"AVERAGE LIFE"
means as of the date of determination with respect to any Debt or other
securities or like instruments, the quotient obtained by dividing (i)
the sum of the products of the number of years from the date of
determination to the dates of each successive scheduled principal
payment of each such Debt, securities or instruments multiplied by the
amount of such principal payment by (ii) the sum of all such principal
payments;
"BANKING DAY"
means a day on which dealings in deposits in Dollars are carried on in
the London Interbank Eurocurrency Market and (other than Saturday or
Sunday) on which banks are open for business in London, Gothenburg and
New York City (or any other relevant place of payment under Clause 7);
"BANKS"
means the banks and financial institutions listed in Schedule 1 and
includes their successors in title and assignees and transferees;
"BOARD OF DIRECTORS"
means either the board of directors of Stena AB (or its relevant
Subsidiary) or any duly authorised committee of that board;
"BOARD RESOLUTION"
means a copy of a resolution certified by Stena AB (or its relevant
Subsidiary) to have been duly adopted by its Board of Directors and to
be in full force and effect on the date of such certification, and
delivered to the Agent;
"BORROWER"
means Stena International B.V. a company incorporated under the laws
of The Netherlands acting through its branch office at ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇, ▇▇-▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇;
"CAPITALISED LEASE OBLIGATION"
of any person means:-
(A) the obligation to pay rent or other payment amounts under a
lease of (or other Debt arrangements conveying the right to
use) real or personal property of such person which is, or is
required to be, classified and accounted for as a capitalised
lease or a liability on the face of a balance sheet of such
person in accordance with Swedish GAAP; or
(B) the obligation to pay interest, principal, rent or other
payment amounts under a financing arrangement pursuant to a
Sale and Leaseback Transaction of real or
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personal property of such person which is, or is required to
be, classified and accounted for as a "financing" or
"financing obligation - sale leaseback" or other liability
on the face of a balance sheet of such person in accordance
with Swedish GAAP
and the Stated Maturity of any such obligation or arrangement shall be
the date of the last scheduled payment of rent or any other amount due
under such lease or financing arrangement prior to the first date upon
which such lease or financing arrangement may be terminated by the
lessee or obligor without payment of a penalty;
"CAPITAL STOCK"
of any person means any and all shares, interests, participations or
other equivalents (however designated) or corporate stock of such
person;
"CASH ASSETS"
means cash and/or Cash Equivalents, except to the extent that such cash
or Cash Equivalents are used to cash collateralise or otherwise secure
any Capitalised Lease Obligation;
"CASH EQUIVALENTS"
means:-
(A) any security issued directly or fully guaranteed or insured by
the United States, the Kingdom of Sweden or any OECD
government whose securities are readily marketable in London,
Frankfurt, Paris or New York City, or any agency or
instrumentality thereof;
(B) other readily marketable securities having a rating of at
least A from Standard & Poor's Ratings Group or ▇▇▇▇▇'▇
Investors Service, Inc.;
(C) any Eurodollar time deposit, overnight deposit, certificate of
deposit or bankers' acceptance, issued by, or time deposit of,
a commercial banking institution which has, on a combined
basis, capital, surplus and undivided profits of not less than
$250,000,000 and has a Moody's Bank Credit Service rating for
short-term bank deposits of at least P-2 (or such similar
equivalent rating by a nationally recognised statistical
rating organisation as defined in Rule 436 under the
Securities Act);
(D) repurchase obligations with a term of not more than ninety
(90) days for underlying securities of the types described in
paragraph (A) above entered into with any commercial banking
institution meeting the qualifications specified in paragraph
(C) above;
(E) short-term commercial paper issued by any person, having one
of the top two investment ratings from either Standard &
Poor's Ratings Group or ▇▇▇▇▇'▇ Investors Service, Inc.;
(F) investments in money market funds substantially all of whose
assets are comprised of securities of the types described in
paragraph (A) through (E) above; and
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(G) deposits which are unrestricted as to withdrawal with
commercial banking institutions meeting the criteria set forth
in paragraph (C) above;
"CASUALTY AMOUNT"
means $5,000,000 (or the equivalent in any other currency) unless the
Agent on the direction of the Majority Banks shall have given notice to
the Borrower that a Default shall have occurred and be continuing or
that in its opinion there shall have been a material adverse change in
the financial condition of the Stena AB Group which may impair the
ability of the Borrower or any Security Party to comply with their
obligations under any Security Document in which case the Casualty
Amount shall be such amount, not however less than $2,000,000, as the
Agent shall signify in its notice to the Borrower;
"CHARTERER'S INSURANCE ASSIGNMENT"
means, in relation to a Mortgaged Ship or Mortgaged Linkspan, any
assignment by a Stena Charterer which charters the relevant Ship or
Linkspan under a demise or bareboat charter executed or (as the context
may require) to be executed by such Stena Charterer pursuant to Clause
11.1 in substantially the form set out in Schedule 12 in favour of the
Security Agent or, in relation to m.v. "STENA GERMANICA" (as long as
she remains owned by Scandlines subject to the Stena Germanica
Mortgage), in favour of the Borrower who, in accordance with the terms
of the Stena Germanica Assignment, will forthwith on-assign it to the
Security Agent as security for the Outstanding Indebtedness;
"CHARTERER'S SUBORDINATION UNDERTAKING"
means, in relation to each Mortgaged Ship or Mortgaged Linkspan, an
undertaking by a Stena Charterer which charters the relevant Ship or
Linkspan under a time charter or a demise or bareboat charter executed
or (as the context may require) to be executed by such Stena Charterer
pursuant to Clause 11.1 in substantially the form set out in Schedule
13 in favour of the Security Agent or, in relation to m.v. "STENA
GERMANICA" (as long as she remains owned by Scandlines subject to the
Stena Germanica Mortgage), in favour of the Borrower who, in accordance
with the terms of the Stena Germanica Assignment, will forthwith
on-assign it to the Security Agent as security for the Outstanding
Indebtedness;
"CLASSIFICATION"
means, in relation to each Ship, the classification set forth against
the name of such Ship in Schedule 2 with its Classification Society or
other highest classification available for Vessels of the same age and
type as the Ship with its Classification Society or such other
classification as the Agent shall, at the request of the Borrower, have
agreed in writing shall be treated as the Classification of such Ship
for the purposes of this Agreement (such agreement not to be
unreasonably withheld or delayed);
"CLASSIFICATION SOCIETY"
means, in relation to any Ship, the classification society set forth
against the name of such Ship in Schedule 2 or Lloyds Register of
Shipping or Det norske Veritas or Germanischer ▇▇▇▇▇ or Bureau Veritas
or American Bureau of Shipping or such other classification society
which the Agent shall, at the request of the Borrower, have
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agreed in writing shall be treated as its Classification Society for
the purposes of this Agreement (such agreement not to be unreasonably
withheld or delayed);
"CO-ARRANGERS"
means ▇. ▇. ▇▇▇▇▇▇ plc, Nordbanken AB (publ) and Svenska Handelsbanken
AB (publ) and includes their respective successors in title and
assignees (and all references to the Co-Arrangers shall include
Nordbanken AB (publ) and Svenska Handelsbanken AB (publ) in their
capacities as Documentation Agents);
"COMMERCIAL DOCUMENTS"
means the documents listed in Schedule 3 and includes each bareboat
charter and management agreement to which a member of the Stena AB
Group is a party entered into hereafter in relation to a Mortgaged Ship
and the documents regulating each sale hereafter of a Ship on Credit
Terms;
"COMMITMENT"
means, in relation to a Bank, the amount set out opposite its name in
Schedule 1 or, as the case may be, in any relevant Transfer
Certificate, as reduced by any relevant term of this Agreement;
"COMMON STOCK"
of any person means Capital Stock of such person that does not rank
prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or
winding up of such person, to shares of Capital Stock of any other
class of such person;
"COMPULSORY ACQUISITION"
means requisition for title or other compulsory acquisition,
requisition, appropriation, expropriation, deprivation, forfeiture or
confiscation for any reason of a Ship or Linkspan by any Government
Entity or other competent authority, whether de jure or de facto, but
shall exclude requisition for use or hire not involving requisition of
title;
"CONSOLIDATED CASH FLOW"
of any person means for any period:-
(A) (i) the Consolidated Operating Income for such period increased
by the sum of (without duplication):-
(x) dividends or other distributions actually paid in cash
or Cash Equivalents to such person by any other person
who is not a Subsidiary of such person but only to the
extent that such dividends or other distributions are
paid in respect of securities classified under
"investments in affiliated companies" on the balance
sheet of such person; plus
(y) consolidated interest income earned by such person
during such period; plus
(z) to the extent deducted from consolidated revenues in
determining Consolidated Operating Income for such
period
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and without duplication, consolidated depreciation and
amortisation expense included in the income statement of
such person for such period and other consolidated non-
cash charges included in the income statement of such
person for such period
minus
(ii) the aggregate gain on the disposition of a Vessel or Vessels
included in Consolidated Operating Income for such period
plus
(B) the aggregate gain on the disposition of a Vessel or Vessels
included in Consolidated Operating Income for such period, but
only to the extent such amount does not exceed twenty five per
cent (25%) of the amount calculated pursuant to paragraph (A)
of this definition;
"CONSOLIDATED INTEREST COVERAGE RATIO"
of any person means for any period the ratio of:-
(A) Consolidated Cash Flow of such person for such period
to
(B) the sum of:-
(i) Consolidated Interest Expense of such person for such
period, plus
(ii) the annual interest expense (including the
amortisation of debt discount) with respect to any
Debt proposed to be Incurred by such person or its
Subsidiaries, plus
(iii) the annual interest expense (including the
amortisation of debt discount) with respect to any
other Debt Incurred by such person or its
Subsidiaries since the end of such period to the
extent not included in paragraph (B)(i) minus
(iv) Consolidated Interest Expense of such person to the
extent included in paragraph (B)(i) with respect to
any Debt that will no longer be outstanding as a
result of the Incurrence of the Debt proposed to be
Incurred;
provided that:-
(X) in making such computation, the Consolidated Interest
Expense of such person attributable to interest on
any Debt bearing a floating interest rate shall be
computed on a pro forma basis as if the rate in
effect on the date of computation had been the
applicable rate for the entire period; and
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(Y) in the event such person or its Subsidiaries has made
Asset Dispositions or acquisitions of assets not in
the ordinary course of business or of any Vessel
(including acquisitions of other persons or Vessels
by merger, consolidation or purchase of Capital
Stock) during or after such period, such computation
shall be made on a pro forma basis as if the Asset
Dispositions or acquisitions had taken place on the
first day of such period
and in the case of the Post-Delivery Financing of a Vessel or
Vessels (or the financing of the acquisition of a
Single-Purpose Vessel-Owning Subsidiary) by Stena AB or any of
its Subsidiaries, the computation of Consolidated Cash Flow
for purposes of calculating the Consolidated Interest Coverage
Ratio shall be increased by:-
(a) the pro forma annual earnings (losses) for such
period pursuant to any binding charter, lease or like
arrangement which will be applicable to any such
Vessel (including a Vessel owned by any such
Single-Purpose Vessel-Owning Subsidiary) for at least
one year after the date of delivery of such Vessel to
Stena AB or any of its Subsidiaries; or
(b) with respect to any such Vessel not subject to such
an arrangement, the earnings (losses) for such period
of the most comparable Vessel of Stena AB or any of
its Subsidiaries (as determined in the reasonable
judgment of the Board of Directors of Stena AB), or,
if Stena AB or any of its Subsidiaries do not have a
comparable Vessel, based on industry average earnings
for comparable Vessels (as determined in the
reasonable judgement of the Board of Directors of
Stena AB) during such period;
"CONSOLIDATED INTEREST EXPENSE"
for any person means for any period the consolidated interest expense
included in the consolidated income statement (without deduction of
interest income) of such person for such period calculated on a
consolidated basis in accordance with Swedish GAAP, including, without
limitation or duplication (or, to the extent not so included, with the
addition of):-
(A) the amortisation of Debt discounts;
(B) any commissions, discounts and other fees and charges with
respect to letters of credit, bankers' acceptances, payment
guarantees or similar facilities;
(C) fees with respect to interest rate swap or similar agreements
or foreign currency hedge, exchange or similar agreements;
(D) Preferred Stock dividends declared and payable in cash;
(E) the interest portion of Capitalised Lease Obligations and
other deferred payment obligations;
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(F) interest actually paid in respect of any guarantee of Debt or
other obligation of any person (other than a consolidated
Subsidiary of such person); and
(G) all non-cash interest payments;
"CONSOLIDATED NET INCOME"
of any person means for any period the consolidated net income (or
loss) of such person for such period determined on a consolidated basis
in accordance with Swedish GAAP, adjusted to the extent included in
such consolidated net income by excluding (without duplication):-
(A) the net income (or loss) of any person acquired by such person
or a Subsidiary of such person in a pooling-of-interests
transaction for any period prior to the date of such
transaction;
(B) the portion of net income (or loss) of any Consolidated
Subsidiary allocable to minority interests;
(C) the net income (but not net loss) of any Subsidiary of such
person which is subject to restrictions which prevent the
payment of dividends or the making of distributions to such
person to the extent of such restrictions;
(D) the net income (or loss) of any person that is not a
Subsidiary of such person except to the extent of the amount
of dividends or other distributions actually paid to such
person by such other person during such period;
(E) gains or losses on Asset Dispositions by such person or its
Subsidiaries provided that gains or losses on the disposition
of a Vessel or Vessels shall be included:-
(i) in the case of a sale for cash, Cash Equivalents
and/or the assumption of Debt in accordance with
paragraph (ii)(z) of Clause 10.7(A), to the full
extent of such gain or loss; and
(ii) in the case of a sale pursuant to a deferred payment
obligation (whether by way of a promissory note or
instalment receivable or otherwise), only to the
extent of the portion of such gain or loss allocable
to such period (based on the life of such deferred
payment obligation) and (with respect to gains only)
only to the extent payments in respect of such
deferred payment obligation are actually received by
such person during such period;
(F) the amount by which the aggregate gain on the disposition of a
Vessel or Vessels exceeds the amounts calculated pursuant to
paragraph (B) of the definition of "Consolidated Cash Flow"
for such period; and
(G) all extraordinary gains and extraordinary losses;
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"CONSOLIDATED OPERATING INCOME"
of any person means for any period the income from operations of such
person for such period determined on a consolidated basis in accordance
with Swedish GAAP, less gains on the disposition of a Vessel or Vessels
pursuant to a deferred payment obligation (whether by way of a
promissory note or instalment receivable or otherwise), plus the
portion of such gain allocable to such period (based on the life of
such deferred payment obligation) to the extent payments in respect of
such deferred payment obligation are actually received by such person
during such period;
"CONSOLIDATED TANGIBLE ASSETS"
of any person means the sum of the Tangible Assets of such person after
eliminating intercompany items, determined on a consolidated basis in
accordance with Swedish GAAP, including appropriate deductions for any
minority interest in Tangible Assets of such person's Subsidiaries;
"CONSOLIDATION" or "CONSOLIDATION"
means, with respect to any person, the consolidation of the accounts of
such person and each of its Subsidiaries if and to the extent the
accounts of such person and each of its Subsidiaries would normally be
consolidated with those of such person, all in accordance with Swedish
GAAP (in the case of Stena AB) or Dutch GAAP (in the case of the
Borrower) and the terms "CONSOLIDATED" and "CONSOLIDATED" shall be
construed accordingly provided that, in the computation of the
Consolidated Net Income, Consolidated Interest Coverage Ratio,
Consolidated Cash Flow, Consolidated Interest Expense, Consolidated
Operating Income, Consolidated Tangible Assets and Tangible Assets of
Stena AB or any other person, the accounts of any Unrestricted
Subsidiary of Stena AB or such other person shall not be included in
any such consolidation even if the inclusion of such accounts would be
required by Swedish GAAP as in effect at the date of the 2007 Indenture
or at any later date and the accounts of no other person shall be
included in such consolidation if not required to be so consolidated by
Swedish GAAP as in effect on the date of the 2007 Indenture;
"CONSTRUCTION FINANCING"
means Debt Incurred by Stena AB or any Subsidiary of Stena AB to
finance any progress or other similar payments required prior to the
delivery of the subject Vessel or Vessels under any Vessel Construction
Contract;
"CONTRIBUTION"
means, in relation to a Bank, the principal amount of the Advances
owing to such Bank at any relevant time;
"CONTROL"
when used with respect to any person means the power to direct the
management and policies of such person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise,
and the terms "CONTROLLING" and "CONTROLLED" shall be construed
accordingly;
"CREDIT TERMS"
means, in relation to an Asset Disposition, terms whereby the whole or
part of the consideration for the Asset Disposition is to be paid or
provided after the date on
- 12 -
which the ownership or possession of the relevant asset is transferred
to a person which is not a Subsidiary of Stena AB;
"DEBT"
means (without duplication), with respect to any person, whether
recourse is to all or a portion of the assets of such person and
whether or not contingent:-
(A) every obligation of such person for money borrowed;
(B) every obligation of such person evidenced by bonds,
debentures, notes or other similar instruments, including
obligations Incurred in connection with the acquisition of
property, assets or businesses;
(C) every reimbursement obligation of such person with respect to
letters of credit, bankers' acceptances, payment guarantees or
similar facilities issued for the account of such person,
other than bonds, letters of credit, payment guarantees or
other similar obligations required by governmental or
regulatory agencies in connection with Vessels owned by or
businesses conducted by Stena AB or any of its Subsidiaries;
(D) every obligation of such person issued or assumed as the
deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the
ordinary course of business which are not overdue or which are
not being contested in good faith);
(E) the maximum fixed redemption or repurchase price of Redeemable
Stock of such persons at the time of determination;
(F) every Capitalised Lease Obligation of such person;
(G) every net obligation under interest rate swap, foreign
currency hedge, exchange or similar agreements of such person;
and
(H) every obligation of the type referred to in paragraphs (A) to
(G) above of another person and all dividends of another
person the payment of which, in either case, such person has
guaranteed or is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise,
provided that:-
(i) guarantees made by any person shall not be deemed
"Debt" to the extent that (a) the Debt so guaranteed
would be classified and accounted for as Debt on the
consolidated balance sheet of such person or (b) both
such person and the person whose obligation is being
guaranteed are Subsidiaries of Stena AB; and
(ii) payment obligations of a person pursuant to a charter
or operating lease which does not constitute a
Capitalised Lease Obligation shall not be deemed
"Debt";
- 13 -
(iii) reimbursement obligations of any person with respect
to facilities in respect of letters of credit,
bankers' acceptances or payment guarantees issued for
the account of such person, or obligations of such
person in respect of loan facilities the proceeds of
which are used as cash collateral, shall not be
deemed "Debt" to the extent that any such facility
(or the proceeds thereof) is used to fully and
irrevocably secure, guarantee or defease the payment
of Debt of such person or any of its Subsidiaries
(including, without limitation, Debt under a
Capitalised Lease Obligation) which is Incurred in
connection with the financing of a Vessel or group of
Vessels and which is otherwise permitted to be
Incurred under this Agreement;
"DEED OF COVENANT"
means, in relation to a Designated Ship, the deed of covenant
collateral to the Ship Mortgage over that Ship (or, in the case of a
Linkspan, the Linkspan Mortgage) and entered or (as the context may
require) to be entered into between the relevant Shipowner and the
Security Agent in the form set out in Schedule 11.1 or, in relation to
m.v. "STENA CARISMA" and her related Linkspans, Schedule 11.2 or, in
relation to m.v. "STENA GERMANICA", between Scandlines and the Borrower
(being the Stena Germanica Deed of Covenant) who will on-assign it to
the Security Agent under the Stena Germanica Assignment as security for
the Outstanding Indebtedness and "DEEDS OF COVENANT" means all of such
deeds of covenant;
"DEFAULT"
means any Event of Default or any event or circumstance which with the
giving of notice or lapse of time or both would constitute an Event of
Default;
"DESIGNATED SHIP"
means each Mortgaged Ship or Mortgaged Linkspan as may from time to
time be registered under British or Swedish or Bahamas flag or any flag
of any other jurisdiction which requires the registration of a ship
mortgage by means of a statutory form and where the Agent determines
that a separate Deed of Covenant is required to protect the interest in
the Mortgaged Ship or Mortgaged Linkspan (as the case may be) of the
Security Agent;
"DISPOSAL REDUCTION AMOUNT"
has the meaning ascribed thereto in Clause 5.3;
"DISPOSAL REDUCTION DATE"
means:-
(A) in the case of a Total Loss of a Mortgaged Ship, the date
which is the earlier of:-
(i) the date one hundred and eighty (180) days after such
Ship became a Total Loss or such later date as may be
agreed by the Agent on the direction of the Majority
Banks from time to time if they are satisfied that
the relevant Ship was insured at the time of the loss
and that the proceeds of the Insurances will be
received and applied in accordance
- 14 -
with the Commercial Documents and the Security
Documents within such further period as may be
acceptable to the Majority Banks; and
(ii) the date upon which insurance proceeds or Requisition
Compensation in respect of such Total Loss are
received by the Security Agent, the Shipowner or the
Stena Charterer in respect of such Ship or a
charterer of such Ship by demise which is not a Stena
Charterer pursuant to the relevant Security Documents
or Commercial Agreements in relation to the relevant
Ship;
(B) in the case of a Total Loss of a Transferred Ship sold on
Credit Terms, the date on which the Total Loss insurance
proceeds are received by the seller of the relevant Ship or
the Security Agent under the relevant Commercial Documents or,
if earlier, the date on which the owner of the relevant
Transferred Ship repays in full to the Shipowner the deferred
consideration for the relevant Ship;
(C) in the case of a sale of a Mortgaged Ship or any share
therein, and except where the sale is effected on Credit
Terms, the date on which the sale of such Ship or share is
completed;
(D) in the case of any Transferred Ship which is transferred on
terms whereby the relevant Shipowner transfers title to the
Ship whilst any part of the deferred consideration therefore
remains outstanding (other than in the case of a Total Loss),
each of the following:-
(i) 31 December 2001 and each date falling at six (6)
monthly intervals thereafter until the deferred
purchase price of the relevant Ship has been paid in
full;
(ii) the date of the final payment of the deferred
purchase price;
(iii) in the case of an enforcement of security given for
the purchaser's obligations by way of sale of the
Ship, the date or dates on which consideration for
the sale of the Ship is paid to the Shipowner or the
Security Agent; and
(iv) if any such Ship is sold by the buyer thereof before
the deferred consideration payable to the Shipowner
has been paid in full, the date on which the
Shipowner receives payment of the balance of the
deferred consideration following such sale;
(E) in the case of a Transferred Ship which is disposed of on
terms whereby the relevant Shipowner retains title to the Ship
until the full amount of the deferred consideration has been
paid (other than in the case of a Total Loss), each of the
following:-
(i) each date falling at six (6) monthly intervals from
the date of completion of the Asset Disposition until
the deferred consideration for the acquisition of the
Ship has been settled in full; and
- 15 -
(ii) the date of such final settlement;
(iii) in case of an enforcement of security for the
purchaser's obligations by way of sale of the Ship,
the date or dates on which the consideration for the
sale of the Ship is paid to the Shipowner or the
Security Agent;
(iv) if the purchaser or lessee of the Ship defaults under
the sale or hire agreement relating to the Ship and
the owner thereof withdraws the Ship from such
purchaser or lessee and the agreement is validly
terminated by the owner or the agreement is
terminated by agreement between the parties thereto
and the Ship returned to the owner's possession, each
date, prior to that on which such Ship again falls to
be treated as a Mortgaged Ship for the purposes of
this Agreement following repossession by the relevant
owner, on which the owner receives any amount by way
of damages or payment for the compromise of any legal
action relating to the agreement or agreed
compensation for termination of the agreement;
(F) in the case of a sale of a Mortgaged Port or any part thereof
(other than the sale of any part of a Mortgaged Port for a
consideration of less than $25,000 or the equivalent thereof
in any other currency) the date on which the sale of such
Mortgaged Port or part thereof is completed;
(G) in the case of a sale of the shares in the capital of any Port
Owner, the date on which the sale of such shares is completed;
"DISQUALIFIED STOCK"
of any person means any Capital Stock of such person which, by its
terms (or by the terms of any security into which it is convertible or
for which it is exchangeable), or upon the happening of any event:-
(A) matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise; or
(B) is convertible or exchangeable for Debt or Disqualified Stock;
or
(C) is redeemable at the option of Stena AB, any Subsidiary of
Stena AB or the holder thereof, in whole or in part, on or
prior to the Termination Date;
"DOCUMENTATION AGENTS"
means Nordbanken AB (publ) and Svenska Handelsbanken AB (publ) in their
capacities as Co-Arrangers responsible for the negotiation and
production of this Agreement and the other Security Documents;
"DOLLARS" and "$"
mean the lawful currency of the United States of America and in respect
of all payments to be made under any of the 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);
- 16 -
"DRAWDOWN NOTICE"
means a notice substantially in the terms of Schedule 4;
"DUTCH GAAP"
means generally accepted accounting principles in the Kingdom of the
Netherlands, consistently applied;
"EARNINGS"
of a person means, in relation to any Ship, all earnings whatsoever due
or to become due to such person including, without limitation, all
moneys receivable by such person and arising, in relation to such Ship,
out of its hire, compensation for requisition for hire, remuneration
for salvage and towage services, demurrage and detention moneys,
damages for breach of any charterparty or other contract for employment
or amounts payable in consideration of the termination or variation of
any such charterparty or contract;
"EVENT OF DEFAULT"
means any of the events or circumstances described in Clause 15.1;
"EXISTING DEBT"
of any person means Debt incurred prior to the date of this Agreement
which remains outstanding and shall include, without limitation, the
aggregate amount of Debt available to be borrowed under committed
credit or lease facilities existing on the date of this Agreement
less:-
(A) principal payments actually made by or on behalf of such
person on any term Debt or lease facility under any agreement
governing such Existing Debt (other than principal payments
made in connection with or pursuant to a refinancing of such
Existing Debt agreement); and
(B) any amounts by which any revolving credit facility commitment
under any Existing Debt agreement is permanently reduced (so
long as and to the extent that any required payments in
connection therewith are actually made);
"FAIR MARKET VALUE"
means, with respect to any asset or property, the sale value that would
be obtained in an arm's-length transaction between an informed and
willing seller under no compulsion to sell and an informed and willing
buyer under no compulsion to buy;
"FLAG STATE"
means, in relation to any Ship or Linkspan, such state or territory as
the Banks may approve pursuant to Clause 19.5, at the request of the
Borrower, as being the "Flag State" of such Ship or Linkspan for the
purposes of the Security Documents;
"GOVERNMENT ENTITY"
means and includes (whether having a distinct legal personality or not)
any national or local government authority, board, commission,
department, division, organ, instrumentality, court or agency and any
association, organisation or institution of which any of the foregoing
is a member or to whose jurisdiction any of the foregoing is subject or
in whose activities any of the foregoing is a participant;
- 17 -
"GUARANTEE"
by any person means any obligation, contingent or otherwise, of such
person guaranteeing any Debt of any other person (the "PRIMARY
OBLIGOR") in any manner, whether directly or indirectly, and including,
without limitation, any obligation of such person:-
(A) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or to purchase (or to
advance or supply funds for the purchase of) any security for
the payment of such Debt;
(B) to purchase property, securities or services for the purpose
of assuring the holder of such Debt of the payment of such
Debt; or
(C) to maintain working capital, equity capital or other financial
statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Debt
(and "GUARANTEED", "GUARANTEEING" and "GUARANTOR" shall be construed
accordingly provided that the guarantee by any person shall not include
endorsements by such person for collection or deposit, in either case,
in the ordinary course of business);
"HOLYHEAD CHARGE"
means the English law first fixed legal charge in respect of Holyhead
Port to be executed and delivered by Stena Line Ports in favour of the
Security Agent in substantially the form set out in Schedule 14;
"HOLYHEAD PORT"
means all of the freehold and leasehold property belonging to Stena
Line Ports at the port of Holyhead, Isle of Anglesey, Gwynedd as is
more particularly described in the Holyhead Charge;
"INCUR"
means, with respect to any Debt or other obligation of any person, to
create, issue, incur (by conversion, exchange or otherwise), assume,
guarantee or otherwise become liable in respect of such Debt or other
obligation or the recording, as required pursuant to Swedish GAAP or
otherwise, of any such Debt or other obligation on the balance sheet of
such person (and "INCURRENCE", "INCURRED", "INCURRABLE" and "INCURRING"
shall be construed accordingly) provided that a change in Swedish GAAP
that results in an obligation of such person that exists at such time
becoming Debt shall not be deemed an Incurrence of such Debt and
provided that:-
(A) Debt of Stena AB or any Subsidiary of Stena AB in respect of
the Post-Delivery Financing of Vessels shall be deemed to have
been "Incurred" in the full amount of such Post-Delivery
Financing only on the date Stena AB (or such Subsidiary)
enters into a binding credit or lease commitment in good faith
with a lender (or group of lenders) or lessor with respect to
such financing;
(B) no Debt shall be deemed to have been "Incurred" solely by
reason of Stena AB or any Subsidiary of Stena AB entering into
a Vessel Construction Contract;
- 18 -
(C) no Debt shall be deemed to have been "Incurred" solely by
reason of the transfer (including, without limitation, by way
of novation or assignment and assumption) of Debt secured by a
Vessel from a Subsidiary of Stena AB to another Subsidiary of
Stena AB in connection with the transfer of such Vessel from
the former to the latter (including, without limitation, a
transfer effected for the purpose of reflagging such Vessel)
provided that such transfer is permitted pursuant to the
provisions of clause (H) of the definition of "Permitted
Liens";
"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;
"2005 INDENTURE"
means the indenture dated as of 20 December 1995 made between Stena AB
and The Chase Manhattan Bank (then called Chemical Bank) as trustee in
relation to the issue of the 2005 Notes as referred to in the 2005
Prospectus;
"2007 INDENTURE"
means the indenture dated as of 1 October 1997 made between Stena AB
and The Chase Manhattan Bank as trustee in relation to the issue of the
2007 Notes as referred to in the 2007 Prospectus;
"INDENTURES"
means the 2005 Indenture and the 2007 Indenture and, where the context
so requires, means either of them;
"INSURANCES"
means, in relation to any Ship or Linkspan, all policies and contracts
of insurance (which expression includes all entries of such Ship or
Linkspan in a protection and indemnity or war risks association) which
are from time to time during the Security Period in place or taken out
or entered into by or for the benefit of the owner and/or any relevant
charterer (or in the joint names of the owner and/or any relevant
charterer or other person)(but not any insurances taken out for the
sole benefit of a charterer which is not a member of the Stena AB
Group) in respect of such Ship or Linkspan or otherwise howsoever in
connection with such Ship or Linkspan and all benefits thereof
(including claims of whatsoever nature and return of premiums);
"INSURANCE ASSIGNMENT"
means, in relation to each Owned Ship or Linkspan which is not a
Designated Ship, the first priority assignment of all the right, title
and interest of the relevant Shipowner in the Insurances and
Requisition Compensation thereof executed or (as the context may
require) to be executed in the form set out in Schedule 9 in favour of
the Security Agent or, in relation to m.v. "STENA GERMANICA" (as long
as she remains owned by Scandlines subject to the Stena Germanica
Mortgage), in favour of the Borrower who, in accordance with the terms
of the Stena Germanica Assignment, will forthwith on-assign it to the
Security Agent as security for the Outstanding Indebtedness and
"INSURANCE ASSIGNMENTS" means all of such assignments;
- 19 -
"INVESTMENT"
by any person means any direct or indirect loan, advance or other
extension of credit (including by way of guarantee or similar
arrangement) or capital contribution to (by means of transfers of cash
or other property to others or payments for property or services for
the account or use of others, or otherwise), or purchase or acquisition
of Capital Stock, bonds, notes, debentures or other securities or
evidence of Debt issued by any other person (other than through the
exchange or conversion of other securities of such other person
pursuant to the terms of such other securities or pursuant to a bona
fide plan of liquidation or reorganisation of such other person in
satisfaction of trade payable obligations owed from such other person)
save that notwithstanding anything to the contrary set forth above:-
(A) the receipt by Stena AB or any of its Subsidiaries of a
promissory note or like evidence of indebtedness pursuant to
an Asset Disposition otherwise permitted under Clause 10.7
(insofar as the receipt of such evidence of indebtedness is
deemed to be a loan made by Stena AB or such Subsidiary) shall
be deemed not to be an "Investment"; and
(B) one or more investments by Stena AB or any of its Subsidiaries
in persons whose only assets are a Vessel and property
directly related thereto shall be deemed not to be an
"Investment";
"ISM CODE"
means the International Safety Management Code for the Safe Operation
of Ships and for Pollution Prevention adopted by the International
Maritime Organisation;
"LEGAL OPINIONS"
means the legal opinions delivered or, as the case may be, to be
delivered to the Agent pursuant to Clause 14.1;
"LIBOR"
means, in relation to a particular period, the rate per annum for
deposits of Dollars for a period equivalent to such period at or about
11.00 a.m. (London time) on the second London Banking Day before the
first day of such period as displayed on ▇▇▇▇▇▇ page LIBOR 01 (British
Bankers' Association Interest Settlement Rates) (or such other page as
may replace such page LIBOR 01 on such system or on any other system of
the information vendor for the time being designated by the British
Bankers' Association to calculate the BBA Interest Settlement Rate (as
defined in the British Bankers' Association's Recommended Terms and
Conditions ("BBAIRS" terms) dated August, 1985)), provided that if on
such date no such rate is so displayed, LIBOR for such period shall be
the arithmetic mean (rounded upward if necessary to four decimal
places) of the rates respectively quoted to the Agent by each of the
Reference Banks at the request of the Agent as such Reference Bank's
offered rate for deposits of Dollars 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 11.00 a.m. (London time) on the second London
Banking Day before the first day of such period;
- 20 -
"LIEN"
means, with respect to any property or assets, any mortgage or deed of
trust, pledge, hypothecation, assignment, security deposit arrangement,
security interest, lien, charge, easement (other than any easement not
materially impairing usefulness or marketability), encumbrance,
preference, priority or other security agreement or preferential
arrangement (other than the subordination of inter-Subsidiary Debt to
the extent required by a lender or lessor of Stena AB or any of its
Subsidiaries) of any kind or nature whatsoever on or with respect to
such property or assets (including, without limitation, any conditional
sale or other title retention agreement having substantially the same
economic effect as any of the foregoing);
"LINKSPAN MORTGAGE"
means:-
(A) in the case of the two Linkspans named "LINKSPAN I" and
"LINKSPAN II" with call signs SFNH and SFNL respectively
registered in the Swedish Register of Shipping, the mortgage
and first priority pledge of mortgage of such Linkspan to be
executed and registered by Stena Line Scandinavia in the form
or substantially in the form set out in Schedule 8 together
also with the deed of covenant collateral thereto to be
executed by Stena Line Scandinavia in the form or
substantially in the form set out in Schedule 11.2;
(B) in the case of any other Linkspan over which a first priority
mortgage is to be executed and, if appropriate, registered by
the relevant Shipowner, a mortgage in form and substance
acceptable to the Agent but in any event substantially similar
to the mortgages and collateral deeds of covenant described in
paragraph (A) above;
"LINKSPANS"
means:-
(A) the linkspan named "LINKSPAN I" having call sign SFNH
registered in the Swedish Register of Shipping in the
ownership of Stena Line and which, prior to drawdown of the
first Advance hereunder, is to be transferred into the name
of Stena Line Scandinavia, which linkspan is at the date of
this Agreement located at Gothenburg and used in connection
with the operation of m.v. "STENA CARISMA";
(B) the linkspan named "LINKSPAN II" having call sign SFNL
registered in the Swedish Register of Shipping in the
ownership of Stena Line and which, prior to drawdown of the
first Advance hereunder, is to be transferred into the name of
Stena Line Scandinavia, which linkspan is at the date of this
Agreement located at Frederikshavn and used in connection with
the operation of m.v. "STENA CARISMA"; and
(C) any other linkspan owned by a member of the Stena AB Group in
relation to which a Linkspan Mortgage or other Lien may be
granted to the Security Agent during the Security Period
directly or indirectly as security for the obligations of the
Borrower under this Agreement
- 21 -
and "LINKSPAN" means any of them;
"LONDON BANKING DAY"
means a day on which dealings and deposits in Dollars are carried on in
the London Interbank Eurocurrency Market and (other than Saturday or
Sunday) a day on which banks are open for business in London;
"LOSS PAYABLE CLAUSES"
means the provisions regulating the manner of payment of sums
receivable under the Insurances of an Owned Ship or a Linkspan which
are to be incorporated in the relevant insurance documents, such Loss
Payable Clauses to be in the forms set out in the Schedules to the Deed
of Covenant and/or Insurance Assignment and/or Charterer's Insurance
Assignment and/or Stena Germanica Assignment in relation to the
relevant Ship or Linkspan, in the form set out in Schedule 20 or in
such other forms as may from time to time be agreed in writing by the
Agent;
"MAJOR CASUALTY"
means an incident or occurrence whereby a Mortgaged Ship sustains
damage or is the subject of a claim in excess of the Casualty Amount;
"MAJORITY BANKS"
means Banks the aggregate of whose Commitments exceed two-thirds
(2/3rds) of the aggregate total of the Commitments of all the Banks;
"MANAGER'S SUBORDINATION UNDERTAKINGS"
means the undertakings in the form of Schedule 18 to be given by each
Approved Manager which is a member of the Stena AB Group, on or before
the date of drawdown of the first Advance or at the time such Approved
Manager is appointed as manager of a Ship or Linkspan after such first
drawdown date;
"MARGIN"
means one per cent (1.00%) (subject to adjustment under Clause 6.7);
"MATURITY DATE"
in relation to an Advance means, subject to Clause 7.4, the last day
of its Term;
"MINOR CASUALTY"
means an incident or occurrence whereby a Mortgaged Ship sustains
damage or is the subject of a claim of the Casualty Amount or less;
"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;
- 22 -
"MORTGAGED LINKSPAN"
means, at any relevant time, any Linkspan which is at such time
subject to a Linkspan Mortgage;
"MORTGAGED PORT"
means, at any relevant time, any Port which is at such time subject to
a Port Mortgage;
"MORTGAGED SHIP"
means, at any relevant time, any Owned Ship which is at such time
subject to a Ship Mortgage and/or the Insurances and Requisition
Compensation of which or sale proceeds or right to receive a rebate of
rentals in respect whereof are subject to an Lien pursuant to the
relevant Ship Mortgage and Deed of Covenant or any relevant Insurance
Assignment or other Security Documents but not including a Transferred
Ship (except that, for the purposes of Clauses 11 and 12, the term
"MORTGAGED Ship" shall include any Transferred Ship where the ownership
of such Transferred Ship is retained by the relevant Shipowner) and an
Owned Ship shall for the purposes of this Agreement be deemed to be a
Mortgaged Ship as from the date that the Lien in respect of that Ship
or rights relating thereto shall have been executed and registered in
accordance with this Agreement until whichever shall be the earlier of
(i) the release of the Ship Mortgage in respect of such Ship or Total
Loss of such Ship and (ii) the end of the Security Period;
"NET AVAILABLE PROCEEDS"
from any Asset Disposition or Sale and Leaseback Transaction by any
person means cash or Cash Equivalents (including, when received,
payments (including any related interest payments) in respect of
deferred payment obligations pursuant to a promissory note or
instalment receivable or otherwise) received (including by way of sale
or discounting of a note, instalment receivable or other receivable,
but excluding any other consideration received in the form of
assumption by the acquirer of Debt or other obligations relating to
such properties or assets or received in any other non-cash form)
therefrom by such person net of:-
(A) all legal, title and recording tax expenses, commissions and
other fees and expenses incurred and all federal, state,
foreign and local taxes required to be accrued as a liability
as a consequence of such Asset Disposition or Sale and
Leaseback Transaction;
(B) all payments made by such person or its Subsidiaries on any
Debt outstanding immediately prior to such Asset Disposition
or Sale and Leaseback Transaction which is secured by such
assets in accordance with the terms of any Lien upon or with
respect to such assets or which must by the terms of such
Lien, or in order to obtain a necessary consent to such Asset
Disposition or by applicable law, be repaid out of the
proceeds from such Asset Disposition or Sale and Leaseback
Transaction or by applicable laws, be repaid out of the
proceeds from such Asset Disposition or Sale and Leaseback
Transaction; and
(C) all distributions and other payments required to be made to
any person (other than Stena AB or any Subsidiary of Stena AB)
owning a beneficial interest in
- 23 -
the assets subject to such Asset Disposition or Sale and
Leaseback Transaction;
"NET CASH SALE PROCEEDS"
means:-
(A) in relation to a Mortgaged Ship and (if relevant) its related
Linkspans or share thereof which is sold (otherwise than on
Credit Terms), the sale price of such Ship and (if relevant)
Linkspans or share received by or on behalf of the relevant
Shipowner (after deducting the relevant Shipowner's reasonable
costs and out-of-pocket expenses incurred in connection with
such sale including reasonable and proper costs of drydocking
the relevant vessel and carrying out any repairs on the vessel
for the purposes of complying with its obligations under the
relevant sale agreement except insofar as the costs of such
repairs are covered by insurance for the benefit of the
relevant Shipowner); and
(B) in relation to a Mortgaged Port or any part thereof, the sale
price thereof received by or on behalf of the relevant Port
Owner (after deducting the relevant Port Owner's reasonable
costs and out-of-pocket expenses incurred in connection with
such sale);
"NON-RECOURSE DEBT"
means Debt or that portion of Debt of any person:-
(A) as to which neither Stena AB nor any of its Subsidiaries:-
(i) provides credit support (including any undertaking,
agreement or instrument which would constitute Debt);
or
(ii) is directly or indirectly liable (whether pursuant to
a guarantee or otherwise) for such Debt; and
(B) no default with respect to such Debt (including any rights
which the holders thereof may have to take enforcement action
against such an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Debt of
Stena AB or any Subsidiary of Stena AB to declare a default on
such other Debt or cause the payment thereof to be accelerated
or payable prior to its Stated Maturity;
"2005 NOTEHOLDERS"
means the holders from time to time of the 2005 Notes;
"2007 NOTEHOLDERS"
means the holders from time to time of the 2007 Notes;
"2005 NOTES"
means the Senior Notes due 2005 issued by Stena AB in an amount of
$175,000,000 pursuant to the ▇▇▇▇ ▇▇▇▇▇▇▇▇▇;
- 24 -
"2007 NOTES"
means the Senior Notes due 2007 issued by Stena AB in an amount of
$175,000,000 pursuant to the ▇▇▇▇ ▇▇▇▇▇▇▇▇▇;
"NOTES"
means the 2005 Notes and the 2007 Notes or, where the context so
requires, means either of them;
"NOTICE OF ASSIGNMENT OF INSURANCES"
means, in respect of a Mortgaged Ship or Mortgaged Linkspan, a notice
of assignment in the form set out in Schedule 1 to the relevant Deed of
Covenant or Schedule 1 to the relevant Insurance Assignment or Schedule
1 to the relevant Charterer's Insurance Assignment or Schedule 5 to the
Stena Germanica Assignment (as the case may be), or in such other form
as may from time to time be required or agreed in writing by the Agent;
"OFFICER'S CERTIFICATE"
means a certificate of Stena AB signed by the Chairman of the Board,
the Chief Executive Officer, the President or the Chief Financial
Officer (or any other officer identified by any of the foregoing
officers in an Officer's Certificate to be an executive officer of
Stena AB), the Secretary, any Assistant Secretary, the Treasurer, the
Financial Manager, any Assistant Treasurer or the Controller of Stena
AB;
"OPINION OF COUNSEL"
means an opinion in writing signed by legal counsel, who may be an
employee of or counsel to Stena AB, and who shall be counsel reasonably
satisfactory to the relevant trustee under each Indenture (or any
applicable Successor Financing);
"OUTSTANDING INDEBTEDNESS"
means all sums of any kind arising at any time for any reason payable
actually or contingently by the Borrower to the Banks, the
Co-Arrangers, the Agent, the Security Agent or any of them under this
Agreement or any other of the Security Documents (whether by way of
repayment of principal, payment of interest or default interest,
payment upon any indemnity or counter-indemnity, reimbursement for
costs or otherwise howsoever);
"OWNED SHIPS"
means the Ships specified in Part 1 of Schedule 2 and such other Ships
owned by a member of the Stena AB Group as may from time to time be
mortgaged to the Security Agent as security for the Borrower's
obligations under this Agreement;
"PERCENTAGE"
as at any date means, in relation to a Bank, the proportion, expressed
as a percentage, which the amount of the Commitment of such Bank bears
to the total amount of the Commitments of all of the Banks (including
such Bank) as at such date and being in relation to each Bank, on the
date of this Agreement, the percentage set out against its name in
Schedule 1;
- 25 -
"PERMITTED INVESTMENTS"
means:-
(A) any Investment in any Cash Equivalent provided that the
Average Life of the aggregate of all Cash Equivalents held by
Stena AB and its Subsidiaries may not exceed one year at any
time;
(B) any Related Business Investment in an amount not in excess of
the amount of Restricted Payments that Stena AB and its
Subsidiaries will be permitted to make under Clause 10.14
immediately prior to the making of such Investment;
(C) Investments made after 1 October 1997 in Unrestricted
Subsidiaries, Stena Line and Coflexip S.A. and Related
Business Investments in an aggregate amount not to exceed:-
(i) ten per cent (10%) of Consolidated Tangible Assets
plus
(ii) the aggregate amount of all moneys from time to time
actually received by Stena AB or any of its
Subsidiaries in respect of Investments made from time
to time pursuant to this paragraph (C) or (in respect
of Investments made after 1 October 1997 but before
the date of this Agreement) paragraph (iii) of the
definition of "Permitted Investments" in the 2007
Indenture, whether such moneys are received as
interest or principal payments (in the case of
Investments made in the form of loans or other debt
instruments or other extensions of credit), as
dividends or redemption payments or return of capital
(in the case of Investments made in the form of the
purchase of Capital Stock or capital contributions)
or otherwise, provided that the aggregate amount
permitted to be invested pursuant to this sub-
paragraph (ii) shall not exceed the aggregate amount
of Investments from time to time actually made by
Stena AB and its Subsidiaries pursuant to this
paragraph (C) or (in respect of Investments made
after 1 October 1997 but before the date of this
Agreement) paragraph (iii) of the definition of
"Permitted Investments" in the 2007 Indenture; plus
(iii) the aggregate amount of all Investments made in any
person pursuant to this paragraph (C) or (in respect
of Investments made after 1 October 1997 but before
the date of this Agreement) paragraph (iii) of the
definition of "Permitted Investments" in the 2007
Indenture if (and for so long as) any such person
becomes a Subsidiary of Stena AB and provided
further, that upon giving effect to such Investment,
Stena AB could incur at least $1 of additional Debt
pursuant to Clause 10.8(A); and
(D) other Investments not otherwise permitted to be made pursuant
to paragraphs (A) to (C) above, which, together with the then
outstanding amount of other Investments made pursuant to this
paragraph (D) or (in respect of Investments made after 1
October 1997 but before the date of this Agreement) paragraph
(iv) of the definition of "Permitted Investments" in the 2007
Indenture, shall not exceed five per cent (5%) of Consolidated
Tangible Assets in aggregate at the time the Investment is
made;
- 26 -
"PERMITTED LIENS"
means:-
(A) Liens securing only the Notes granted pursuant to Section
10.14 of either Indenture where equivalent Liens are granted
to the Security Agent on a pari passu basis as security for
the Outstanding Indebtedness;
(B) Liens in favour of Stena AB or, with respect to Liens granted
by any Subsidiary of Stena AB, in favour of Stena AB or any
Wholly Owned Subsidiary of Stena AB;
(C) Liens on property existing immediately prior to the time of
acquisition thereof (and not created in anticipation of
such acquisition);
(D) (x) Liens to secure Debt Incurred for the purpose of
financing all or any part of the purchase price or the cost
of construction or lease (pursuant to a Capitalised Lease
Obligation) of a Vessel or other property, or the cost of
improvements of a Vessel or other property used in the
business of Stena AB and its Subsidiaries and (y) Liens on
any Vessel or other property (including, without limitation,
the Related Collateral) owned or leased (pursuant to a
Capitalised Lease Obligation) by a Subsidiary of Stena AB
prior to the time it becomes a Subsidiary of Stena AB to
secure Debt Incurred by Stena AB (or any Subsidiary of Stena
AB), in an amount not to exceed the Fair Market Value of
such Vessel or other property or such Subsidiary, for the
purpose of financing (or refinancing) all or part of the
acquisition cost of such Subsidiary, but only if such Debt
is Incurred within 180 days after the acquisition of such
Subsidiary; provided that, with respect to clauses (x) and
(y) above:-
(i) in the case of a Vessel or Vessels, the principal
amount of any Debt secured by such a Lien does not
exceed 80% of the Ready for Sea Cost of a Vessel (or,
with respect to Debt Incurred under a single
financing facility to finance all or part of the
purchase price or construction cost of two or more
Vessels, the aggregate Ready for Sea Cost of such
group of Vessels) or such Fair Market Value (as the
case may be) of such Vessel or other property; and
provided further that the principal amount of Debt
secured by such a Lien may be up to 100% of the Ready
for Sea Cost of such Vessel or Vessels if such Debt
financing consists of Capitalised Lease Obligations;
and provided further that, with respect to any Debt
Incurred to finance the replacement of a Vessel as
described in Clause 10.8(B)(iv) or 10.9(A), the
principal amount of such Debt secured by such Lien
may be up to 100% of the Ready for Sea Cost of such
replacement Vessel less all compensation, damages or
other such payments (including insurance proceeds
other than in respect of business interruption
insurance, protection and indemnity insurance or
other third-party liability insurance) received in
connection with a Total Loss in excess of amounts
actually used to repay Debt secured by the Vessel
subject to the Total Loss;
- 27 -
(ii) such Liens do not extend to or cover any property
other than such Vessel or other property and Related
Collateral and any such improvements;
(iii) the Incurrence of such Debt is permitted by the
provisions of Clause 10.8 and, if applicable, Clause
10.9; and
(iv) any such Liens (other than Liens of the type
described in paragraph (D) of the definition of
"Related Collateral") attach within 180 days after
the date of the acquisition or delivery (or
completion of such improvements) of such Vessel or
group of Vessels or person or other property;
(E) Liens on property of a person existing at the time such person
is merged into or consolidated with or acquired by Stena AB or
any Subsidiary of Stena AB that were not created in
anticipation of the acquisition of such person;
(F) Permitted Ship Liens and any other Liens in respect of Vessels
and Related Collateral arising in the ordinary course of
business which, individually or in the aggregate do not
materially and adversely affect such Vessel or materially
impair the use and operation thereof or the business of Stena
AB and its Subsidiaries;
(G) Liens to secure obligations under workmen's compensation laws
or similar legislation, including Liens with respect to
judgments which are not currently dischargeable;
(H) Liens to secure Debt Incurred to refinance, in whole or in
part, (i) any secured Debt existing on the date of this
Agreement or (ii) any Debt secured by Liens referred to in
paragraphs (A) to (G) above and paragraphs (J) and (M)
below, so long as in each such case the Liens do not extend
to any other property (except for the Related Collateral, or
other property and Related Collateral secured by Debt which
is being concurrently refinanced on a cross-collateralised
basis) and the aggregate principal amount of Debt so secured
(which amount shall be deemed to include the amount of any
undrawn or available amounts under any credit or lease
facility to be so refinanced) is not increased (other than
as permitted pursuant to Clause 10.8(B)(vi)(a)(y) or Clause
10.9(F)(i)(b) by an amount greater than the amount of any
premium required to be paid in connection with such
refinancing pursuant to the terms of the Debt refinanced or
the amount of any premium reasonably determined by Stena AB
as necessary to accomplish such refinancing by means of a
tender offer or privately negotiated repurchase, plus the
expenses of Stena AB or any of its Subsidiaries incurred in
connection with such refinancing;
(I) any Liens securing Debt owing by Stena AB to one or more
Wholly Owned Subsidiaries of Stena AB;
(J) subject to compliance with sections (i), (iii) and (iv) of
paragraph (D) above, a pledge of, or other Lien in respect of,
the Capital Stock of a Single-Purpose Vessel-Owning Subsidiary
made to secure (i) Debt Incurred by such Single-
- 28 -
Purpose Vessel-Owning Subsidiary to finance or refinance the
acquisition, construction or improvement of a Vessel by such
Subsidiary or (ii) Debt Incurred by Stena AB or any
Subsidiary of Stena AB to finance or refinance the
acquisition of any or all of the Capital Stock of such
Single-Purpose Vessel-Owning Subsidiary;
(K) Liens in respect of Vessels and Related Collateral otherwise
permitted hereunder and incurred solely by reason of the
substitution of a new mortgage or other security agreements
for an existing agreement (or the novation or assignment of
such existing agreement), the effect of which new agreement,
novation or assignment is to effect the reflagging of the
Vessel or Vessels to which such existing agreement relates;
(L) Liens created by this Agreement and the Security Documents;
(M) Liens created by the Stena Discovery Facility Agreement and
the "Security Documents" referred to therein;
(N) a pledge or assignment of a promissory note (or other evidence
of indebtedness), or the assignment of a mortgage or other
security interest, or guarantee received by or granted to
Stena AB or any of its Subsidiaries pursuant to an Asset
Disposition to secure the unpaid portion of any Debt of Stena
AB or any of its Subsidiaries attributable to the property
sold in such Asset Disposition;
(O) subject to the limit imposed by Clause 10.6, Liens in respect
of Related Collateral and/or other property required to be
granted under the terms of an agreement governing Debt of
Stena AB or any Subsidiary of Stena AB to provide additional
security to the lenders under such agreement in the event the
value of the Vessel or Vessels and other property securing
such Debt falls below the level specified in such agreement;
(P) Liens on a Vessel, Related Collateral (and/or the contract for
the acquisition of such Vessel and/or Related Collateral)
existing only during the construction of such Vessel and
granted to secure the builder's obligations in respect of
construction financing for such Vessel obtained by such
builder; and
(Q) Liens incurred to secure the Revolving Credit Facilities as
required by the terms thereof;
"PERMITTED SHIP LIENS"
means:-
(A) any ship repairer's or outfitter's possessory lien for a sum
not (except with the prior written consent of the Agent or
where the cost of the relevant work is covered by the vessel's
insurances or is required for the purpose of maintaining the
vessel's classification) exceeding the Casualty Amount;
(B) any lien on a vessel for master's, officer's or crew's wages
outstanding in the ordinary course of trading;
- 29 -
(C) any lien for salvage;
(D) liens arising in the ordinary course of trading by statute or
by operation of law in respect of obligations which are not
overdue or which are being contested in good faith by
appropriate proceedings (and for the payment of which adequate
reserves have been provided) so long as any such proceedings
or the continued existence of such lien do not involve any
likelihood of the sale, forfeiture or loss of, or of any
interest in, any vessel owned by or chartered to a Security
Party or any other member of Stena AB Group;
(E) liens securing liabilities for Taxes against which adequate
reserves have been provided;
(F) liens arising in respect of a Ship or Linkspan by reason of an
act or omission of a charterer (other than a Stena Charterer)
of the Ship or Linkspan, in relation to which the relevant
Shipowner or Stena Charterer demonstrates to the reasonable
satisfaction of the Agent that it is taking all reasonable
steps available to it with due dispatch to procure the lifting
of the lien;
"PLANNING ACTS"
means, in the case of Holyhead Port or any other Port situated in
England and Wales, the Town and Country Planning Acts 1990 and, in the
case of Stranraer Port or any other Port situated in Scotland, the Town
and Country Planning (Scotland) Act 1972 (including in each case any
Act or Acts for the time being amending or replacing such Acts and any
orders, regulations and direction issued under or by virtue of such
Acts or such amending or replacing Acts for the time being in force);
"P&O STENA"
means P&O Stena Line (Holdings) Limited, a company incorporated with
limited liability under the laws of England and Wales with company
number 3291852 and having its registered office at ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇ ▇▇▇;
"P&O STENA LOAN STOCK"
means all of SLUK's 30,000,000 units of the (pound)150,000,000 nominal
amount of zero per cent second unsecured loan stock 2017 issued by P&O
Stena constituted by a loan stock instrument dated 9 March 1998 issued
by P&O Stena (and any other loan stock from time to time issued by P&O
Stena and held by SLUK or any other member of the Stena AB Group);
"P&O STENA SHARES"
means all of SLUK's 5,625,000 ordinary shares designated "B" shares in
the capital of P&O Stena (and any other shares from time to time issued
by P&O Stena and held by SLUK or any other member of the Stena AB
Group);
"PORT"
means each of Holyhead Port and Stranraer Port and includes any other
port which is or may become owned by a member of the Stena AB Group;
- 30 -
"PORT MORTGAGE"
means:-
(A) in the case of Holyhead Port, the Holyhead Charge; and
(B) in the case of Stranraer Port, the Stranraer Charge;
"PORT OWNER"
means, in relation to a Mortgaged Port, the owner thereof being, at the
date of this Agreement, Stena Line Ports in respect of both Holyhead
Port and Stranraer Port;
"PORT OWNER'S GUARANTEE"
means, in respect of each Port Owner, the deed of guarantee and
indemnity to be executed and delivered by that Port Owner in favour of
the Security Agent in substantially the form set out in Schedule 7.2;
"PORT OF REGISTRY"
means in relation to a Mortgaged Ship the port of registry approved in
writing by the Banks at which such Ship is, or is to be registered on,
or at any relevant time after, the date hereof;
"POST COMPLETION REGISTRATIONS"
means registration of the Liens created by any of the Security
Documents and the restriction contained in Clause 10.6 which require to
be completed within a period after execution thereof and/or hereof
under the laws of any relevant jurisdiction;
"POST-DELIVERY FINANCING"
means Debt Incurred by Stena AB or any Subsidiary of Stena AB to
finance the total Ready for Sea Cost of a Vessel or group of Vessels
and "Post-Delivery Financing" shall include the amount of any
Construction Financing with respect to any Vessel or group of Vessels,
but only to the extent that fully committed Post-Delivery Financing for
such Vessel or group of Vessels has been arranged at such time;
"PREFERRED STOCK"
as applied to the Capital Stock of any person, means Capital Stock of
such person of any class or classes (however designated) that ranks
prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or
winding up of such person, to shares of Capital Stock of any other
class of such person;
"2005 PROSPECTUS"
means the final prospectus of Stena AB relating to the initial public
offering of the 2005 Notes, such prospectus having been filed with the
Securities and Exchange Commission in Washington, D.C. with
registration number 33-99284;
"2007 PROSPECTUS"
means the final prospectus of Stena AB relating to the initial public
offering of the 2007 Notes, such prospectus having been filed with the
Securities and Exchange Commission in Washington, D.C. with
registration number 333-7486;
- 31 -
"READY FOR SEA COST"
means, with respect to a Vessel or Vessels to be acquired or leased
(pursuant to a Capitalised Lease Obligation) by Stena AB or any
Subsidiary of Stena AB, the aggregate amount of all expenditures
incurred to acquire or construct and bring such Vessel or Vessels to
the condition and location necessary for its intended use which would
be classified and accounted for as "property, plant and equipment" in
accordance with Swedish GAAP;
"RECEIVABLES ASSIGNMENT"
means the first priority assignment to be granted in favour of the
Security Agent in respect of the deferred purchase consideration and
Insurances and other security granted in relation to a Transferred Ship
in accordance with Clause 5.3(L) substantially in the form set out in
Schedule 16 in relation to a Ship sold on terms set out in paragraph
(A) of the definition of Transferred Ship and substantially in the form
set out in Schedule 17 in relation to a Ship sold on terms set out in
paragraph (B) of the definition of Transferred Ship;
"REDEEMABLE STOCK"
of any person means any equity security of such person that by its
terms or otherwise is required to be redeemed prior to the Termination
Date or is redeemable at the option of the holder thereof at any time
prior to the Termination Date;
"REFERENCE BANKS"
means the principal London offices of Svenska Handelsbanken AB (publ),
▇. ▇. ▇▇▇▇▇▇ plc and Nordbanken AB (publ) and/or any other Bank
appointed as such pursuant to this Agreement;
"REFINANCE"
has the meaning ascribed to it in Clause 10.8(B)(vi) and shall be
deemed to include successive refinancings;
"RELATED BUSINESS INVESTMENT"
means an Investment made in a person engaged in the same or a similar
line of business as Stena AB and its Subsidiaries or made for the
purpose of maintaining, enhancing the productivity of or expanding the
capabilities of Stena AB and its Subsidiaries in any business activity
permitted under Clause 10.12 (as determined, with respect to any such
Investment or series of related Investments in an aggregate amount of
$5,000,000 or more, in good faith by the Board of Directors of the
person making such Investment);
"RELATED COLLATERAL"
means, with respect to a Vessel:-
(A) any insurance policies on such Vessel;
(B) any requisition compensation payable in respect of any
compulsory acquisition thereof;
(C) any earnings derived from the use or operation thereof and/or
any earnings account with respect to such earnings, provided
that any assignment with
- 32 -
respect thereto may only permit the assignee thereof to
apply such earnings to the repayment of Debt held by such
assignee:-
(i) upon the occurrence and during the continuation of a
payment default with respect to such Debt or upon the
acceleration of such Debt (unless such acceleration
has been rescinded); or
(ii) in the case of any other default with respect to such
Debt which would allow for the acceleration of such
Debt at such time, but only until the earliest of:-
(a) 180 days after the initial occurrence of
such default;
(b) the date such default is cured or waived;
and
(c) the date such Debt is repaid in full;
(D) any charters, operating leases, licences and related
agreements entered into in respect of the Vessel and any
security or guarantee in respect of the relevant charterer's
or lessee's obligations under any relevant charter, operating
lease, licence or related agreement;
(E) any cash collateral account established with respect to such
Vessel pursuant to the financing arrangements with respect
thereto;
(F) any inter-company loan or facility agreements relating to the
financing of the acquisition of, and/or the leasing
arrangements ,pursuant to Capitalised Lease Obligations) with
respect to, such Vessel;
(G) any building or conversion contracts relating to such Vessel
and any security or guarantee in respect of the builder's
obligations under such contracts;
(H) any interest rate swap, foreign currency hedge, exchange or
similar agreement incurred in connection with the financing of
such Vessel and required to be assigned by the lender; and
(I) any security interest in, or agreement or assignment relating
to, any of the foregoing or any mortgage in respect of such
Vessel;
"RELATED PERSON"
of any person means any other person directly or indirectly owning:-
(A) five per cent (5%) or more of the outstanding Common Stock of
such person (or, in the case of a person that is not a
corporation, five per cent (5%) or more of the equity interest
in such person); or
(B) five per cent (5%) or more of the combined voting power of
Voting Stock of such person;
- 33 -
"REQUISITION COMPENSATION"
means, in relation to a Ship or Linkspan, all sums of money or other
compensation from time to time payable during the Security Period by
reason of the Compulsory Acquisition of such Ship or Linkspan;
"REVOLVING CREDIT FACILITIES"
means one or more revolving or other credit facilities to which Stena
AB and/or one or more Subsidiaries of Stena AB may be parties (as
obligor or guarantor) in an aggregate principal amount not to exceed
$600,000,000 at any time outstanding;
"SALE AND LEASEBACK TRANSACTION"
of any person means an arrangement with any lessor, lender, obligee or
investor or to which such lessor, lender, obligee or investor is a
party providing for the leasing or renting by such person of any
property or asset of such person which has been or is being sold or
transferred by such person more than two hundred and seventy (270) days
after the acquisition thereof or, if later, the delivery or
commencement of operation thereof, to such lessor, lender, obligee or
investor or to any person to whom funds have been or are to be advanced
by such lessor, lender, obligee or investor on the security of such
property or asset and the Stated Maturity of such arrangement shall be
the date of the last scheduled payment of rent or any other amount due
under such arrangement prior to the first date on which such
arrangement may be terminated by the lessee without payment of a
penalty;
"SCANDLINES"
means Scandlines AB, a company incorporated under the laws of the
Kingdom of Sweden with registration number 556206-4575 in the Swedish
Companies Register and having its registered office at ▇▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇;
"SECURITIES ACT"
refers to the Securities Act of 1933 of the United States of America as
it may be amended and any successor act thereto;
"SECURITY AGENT"
means Svenska Handelsbanken AB (publ) or such other person as may be
appointed security agent for the Banks, the Co-Arrangers and the Agent
pursuant to this Agreement;
"SECURITY DOCUMENTS"
means this Agreement, the Ship Mortgages, the Deeds of Covenant, the
Insurance Assignments, the Shipowner's Guarantees, the Linkspan
Mortgages, the Charterer's Insurance Assignments, the Charterer's
Subordination Undertakings, the Manager's Subordination Undertakings,
the Stena Germanica Assignment, each Receivables Assignment, the Port
Owner's Guarantees, the Port Mortgages and any other documents as may
have been or shall from time to time after the date of this Agreement
be executed to guarantee and/or secure all or any part of any moneys
from time to time owing by the Borrower pursuant to this Agreement
(whether or not any such document also secures moneys from time to time
owing pursuant to any other document or agreement);
- 34 -
"SECURITY PARTY"
means any person who may at any time be a party to any of the Security
Documents (other than the Banks, the Co-Arrangers, the Agent and the
Security Agent) but does not include either any such party as and when
it has ceased to be under any continuing obligation under the Security
Documents and its property has ceased to be (or was never) subject to
any Lien pursuant to any of the Security Documents or any party which
is not a member of the Stena AB Group;
"SECURITY PERIOD"
means the period commencing on the date hereof and terminating upon the
later of (i) the end of the Availability Period and (ii) the discharge
of the security created by the Security Documents by payment of moneys
payable thereunder;
"SHIP MORTGAGE"
means, in relation to an Owned Ship:-
(A) in the case of a Designated Ship (other than a Ship registered
in Sweden), the first priority statutory mortgage of the Ship
executed (or as the context may require) to be executed and
registered by the relevant Shipowner in favour of the Security
Agent including the narrative text set out in Schedule 10;
(B) in the case of a Ship which is registered in Sweden the first
priority mortgage and pledge of mortgage of the Ship to be
executed and registered by the relevant Shipowner in the form
or substantially in the form set out in Schedule 8, which
mortgage and pledge of mortgage in the case of m.v. "STENA
GERMANICA" (the Stena Germanica Mortgage) has been executed
and assigned to the Borrower (as assignee from Stena Line
Scandinavia (as assignee from Stena Line)) and on-assigned by
it to the Security Agent under the Stena Germanica Assignment
as security for the Outstanding Indebtedness;
(C) in the case of any other Owned Ship over which, after drawdown
of the first Advance, a first priority mortgage is to be
executed and registered by the relevant Shipowner, a mortgage
in a form and substance acceptable to the Agent but in any
event substantially similar to the mortgages described in
paragraphs (A) and (B) above and including, where appropriate,
mortgage covenants substantially similar to those contained in
the pro forma Deed of Covenants set out in Schedule 11.1;
and "SHIP MORTGAGES" means all of such mortgages;
"SHIPOWNER"
means, in relation to a Ship or Linkspan, the registered owner or
owners thereof and being at the date of this Agreement, in relation to
a Ship identified in Schedule 2, the company whose name is set forth
opposite the name of such Ship in Schedule 2;
"SHIPOWNER'S GUARANTEE"
means, in respect of each Shipowner and each member of the Stena
International Group which at any time during the Security Period owns a
Ship or Linkspan or sells a Mortgaged Ship on Credit Terms, the deed of
guarantee and indemnity to be
- 35 -
executed and delivered by that Shipowner or other member of the Stena
International Group in favour of the Security Agent in substantially
the form set out in Schedule 7.1 (provided that no Shipowner's
Guarantee shall be required from Scandlines by reason of its
registered ownership of m.v. "STENA GERMANICA" as long as the Stena
Germanica Loan Documents remain in place in favour of the Borrower and
are assigned to the Security Agent under the Stena Germanica
Assignment);
"SHIPS"
means each of the ships listed in Schedule 2 and includes any other
Vessel in relation to which a Ship Mortgage, or in relation to rights
to the sale proceeds, Insurances or rebate of rentals of which a Lien,
may be granted to the Security Agent during the Security Period
directly or indirectly as security for the obligations of the Borrower
under this Agreement and "SHIP" means any of them;
"SINGLE-PURPOSE VESSEL-OWNING SUBSIDIARY"
means a Subsidiary of Stena AB the sole purpose of which is to own or
lease (pursuant to a Capitalised Lease Obligation) one (but not more
than one) Vessel;
"SLUK"
means Stena Line (UK) Limited, a company incorporated with limited
liability under the laws of England and Wales with company number
2454575 and having its registered office at ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇ ▇▇▇;
"STATED MATURITY"
means:-
(A) with respect to any debt security, the date specified in such
debt security as the fixed date on which the final instalment
of principal of such debt security is due and payable; or
(B) with respect to any specified scheduled instalment of
principal or interest on any debt security, the date specified
in such debt security as the fixed date on which such
instalment is due and payable;
"STENA AB"
means Stena AB a company incorporated under the laws of the Kingdom of
Sweden with registration number 556001-0802 in the Swedish Companies
Register and having its registered office at Masthuggskajen, ▇▇-▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇;
"STENA AB GROUP"
means Stena AB and its Subsidiaries and "MEMBER OF THE STENA AB GROUP"
means Stena AB or any of its Subsidiaries;
"STENA CHARTERER"
means any member of the Stena AB Group to whom a Mortgaged Ship or a
Transferred Ship or a Mortgaged Linkspan may be chartered;
"STENA DISCOVERY FACILITY AGREEMENT"
means the facility agreement dated of even date herewith made between
the Borrower as borrower and Deutsche Bank AG as lender pursuant to
which Deutsche Bank AG
- 36 -
has agreed to make available to the Borrower a secured term loan
facility in the amount of $75,000,000 to be secured on, inter alia,
m.v. "STENA DISCOVERY" and her linkspans and to be applied towards
partly refinancing the existing indebtedness of Stena Line under the
Stena Line Revolving Credit Facility;
"STENA GERMANICA ASSIGNMENT"
means the first priority assignment of all the right, title and
interest of the Borrower in the Stena Germanica Loan Documents to be
executed and delivered by the Borrower in favour of the Security Agent
in substantially the form set out in Schedule 19;
"STENA GERMANICA CHARTERER'S INSURANCE ASSIGNMENT"
means the Charterer's Insurance Assignment executed or (as the case may
be) to be executed by Stena Line Scandinavia in favour of the Borrower
on or before the Availability Date;
"STENA GERMANICA CHARTERER'S SUBORDINATION UNDERTAKING"
means the Charterer's Subordination Undertaking executed or (as the
case may be) to be executed by Stena Line Scandinavia in favour of the
Borrower on or before the Availability Date;
"STENA GERMANICA DEED OF COVENANT"
means the deed of covenant dated 21 December 2000 made between
Scandlines as owner and Stena Line as mortgagee as assigned by Stena
Line to Stena Line Scandinavia pursuant to the Stena Line Asset
Purchase Agreement and as amended by an amendment no. 1 thereto to be
made on or before the Availability Date between Scandlines, Stena Line
Scandinavia and the Borrower amending certain provisions thereof and
assigning all of Stena Line Scandinavia's rights, title and interest
thereunder to the Borrower;
"STENA GERMANICA LOAN AGREEMENT"
means the inter-company loan agreement dated 21 December 2000 made
between Scandlines as borrower and Stena Line as lender under which
Stena Line made available to Scandlines a loan in the amount of
$52,000,000 as assigned by Stena Line to Stena Line Scandinavia
pursuant to the Stena Line Asset Purchase Agreement and as amended by
an amendment no. 1 thereto to be made on or before the Availability
Date between Scandlines, Stena Line Scandinavia and the Borrower
amending certain provisions thereof and assigning all of Stena Line
Scandinavia's right, title and interest thereunder to the Borrower;
"STENA GERMANICA LOAN DOCUMENTS"
means the Stena Germanica Loan Agreement, the Stena Germanica
Mortgage, the Stena Germanica Deed of Covenant, the Stena Germanica
Charterer's Insurance Assignment and the Stena Germanica Charterer's
Subordination Undertaking;
"STENA GERMANICA MORTGAGE"
means the first priority mortgage and pledge of mortgage of m.v. "STENA
GERMANICA" dated 21 December 2000 executed and registered by Scandlines
in favour of Stena Line as assigned by Stena Line to Stena Line
Scandinavia pursuant to the Stena Line Asset Purchase Agreement and as
assigned by Stena Line Scandinavia to the Borrower on or before the
Availability Date;
- 37 -
"STENA INTERNATIONAL GROUP"
means Stena International B.V. and its Subsidiaries;
"STENA LINE"
means Forvaltningsaktiebolaget Lastluckan (formerly Stena Line AB), a
company incorporated under the laws of the Kingdom of Sweden with
registration number 556207 - 8005 in the Swedish Companies Register and
having its registered office at Masthuggsterminalen, ▇▇-▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇;
"STENA LINE ASSET PURCHASE AGREEMENT"
means the agreement made or (as the context may require) to be made
between Stena Line and Stena Line Scandinavia pursuant to which (inter
alia) Stena Line shall assign all its rights in respect of the Stena
Germanica Loan Agreement, the Stena Germanica Mortgage and the Stena
Germanica Deed of Covenant to Stena Line Scandinavia;
"STENA LINE PORTS"
means Stena Line Ports Limited, a company incorporated with limited
liability under the laws of England and Wales with company number
1824328 and having its registered office at ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇ ▇▇▇;
"STENA LINE REVOLVING CREDIT FACILITY"
means the $425,000,000 secured revolving credit and guarantee facility
provided to Stena Line pursuant to a facility agreement dated 28 May
1998 (as amended) made between, amongst others, (1) Stena Line as
borrower, (2) the various banks and financial institutions named
therein as lenders, (3) The Bank of Nova Scotia as issuing bank and (4)
Svenska Handelsbanken AB (publ) as agent and security agent;
"STENA LINE SCANDINAVIA"
means Stena Line Scandinavia AB, a company incorporated under the laws
of the Kingdom of Sweden with registration number 556231-7825 in the
Swedish Companies Register and having its registered office at ▇▇-▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇;
"▇▇▇▇ ▇. ▇▇▇▇▇▇ FAMILY"
means:-
(A) Sten ▇▇▇▇▇ ▇▇▇▇▇▇;
(B) all the lineal descendants in direct line of the said Sten
▇▇▇▇▇ ▇▇▇▇▇▇;
(C) a husband and wife or former husband or wife or widower or
widow of any of the above persons; and
(D) the estates or legal representatives of any of the above
persons
and so that for the purposes of this definition a step-child or adopted
child or illegitimate child of any person shall be deemed to be a
lineal descendant of such person and of the lineal ascendants of such
person;
- 38 -
"▇▇▇▇ ▇. ▇▇▇▇▇▇ FAMILY TRUSTS"
means trusts (whether arising under settlement, declaration of trust
or other instrument by whomsoever or wheresoever made or under a
testamentary disposition or on an intestacy) under which no immediate
beneficial interest in the property which is the subject of such trust
is for the time being vested in any person other than members of the
▇▇▇▇ ▇. ▇▇▇▇▇▇ Family;
"STRANRAER CHARGE"
means the Scots law first priority standard security in respect of
Stranraer Port to be executed and delivered by Stena Line Ports in
favour of the Security Agent in substantially the form set out in
Schedule 15;
"STRANRAER PORT"
means all of the property belonging to Stena Line Ports at Stranraer
Harbour, Stranraer, County of Wigtown, Scotland as is more particularly
described in the Stranraer Charge;
"SUBORDINATED DEBT"
means Debt of Stena AB or any Subsidiary of Stena AB which is
subordinate or junior in right of payment to the Notes (or any
applicable Successor Financing) pursuant to a written agreement;
"SUBSIDIARY"
of any person means:-
(A) a corporation more than fifty per cent (50%) of the
outstanding Voting Stock of which is owned, directly or
indirectly, by such person or by one or more other
Subsidiaries of such person or by such person and one or more
Subsidiaries thereof; or
(B) any other person (other than a corporation) in which such
person, or one or more other Subsidiaries of such person or
such person and one or more other Subsidiaries thereof,
directly or indirectly, has at least a majority ownership and
power to direct the policies, management and affairs thereof
but for the purposes of the definitions of "Affiliate", "Asset
Disposition", "Consolidated Cash Flow", "Consolidated Interest Coverage
Ratio", "Consolidated Interest Expense", "Consolidated Net Income",
"Consolidated Tangible Assets", "Construction Financing", "Disqualified
Stock", "Investment", "Lien", "Net Available Proceeds", "Non-Recourse
Debt", "Permitted Investments", "Permitted Liens", "Post-Delivery
Financing", "Ready for Sea Cost", "Related Business Investment",
"Revolving Credit Facilities", "Single-Purpose Vessel-Owning
Subsidiary", "Subordinated Debt", "Unrestricted Subsidiary", "Vessels",
"Vessel Construction Contract", "Wholly Owned Subsidiary" and the
proviso to the definition of "Incur" and Clauses 10.6, 10.7, 10.8,
10.9, 10.10, 10.11, 10.12 and 10.14 Unrestricted Subsidiaries shall be
deemed not to be Subsidiaries of Stena AB;
"SUCCESSOR FINANCING"
has the meaning ascribed thereto in Clause 10.18;
- 39 -
"SWEDISH GAAP"
means generally accepted accounting principles in the Kingdom of
Sweden, consistently applied and (but only in relation to the
definitions of "Capitalised Lease Obligation", "Consolidated Cash
Flow", "Consolidated Interest Coverage Ratio", "Consolidated Interest
Expense", "Consolidated Net Income", "Consolidated Operating Income",
"Consolidated Tangible Assets" and "Tangible Assets" and not for any
other purpose of this Agreement) as in effect on the date of the 2007
Indenture;
"TANGIBLE ASSETS"
of any person means, at any date, the gross book value as shown by the
accounting books and records of such person of all its property both
real and personal, less (without duplication):-
(A) the net book value of all its licences, patents, patent
applications, copyrights, trademarks, trade names, goodwill,
non-compete agreements or organisational expenses and other
like intangibles;
(B) unamortised Debt discount and expenses;
(C) all reserves for depreciation, obsolescence, depletion and
amortisation of its properties; and
(D) all other proper reserves which in accordance with Swedish
GAAP should be provided in connection with the business
conducted by such person;
"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;
"TERM"
means, in relation to an Advance, the period for which such Advance
is, or is to be, borrowed, as specified in the Drawdown Notice for
such Advance;
"TERMINATION DATE"
means, subject to Clause 7.4, the date falling sixty (60) months after
the date hereof;
"TOTAL LOSS"
in relation to a Ship or Linkspan means:-
(A) actual, constructive, compromised or arranged total loss of
such Ship or Linkspan; or
(B) the Compulsory Acquisition of such Ship or Linkspan; or
(C) the condemnation, capture, seizure, arrest, detention or
confiscation of such Ship or Linkspan (other than where the
same amounts to the Compulsory Acquisition of such Ship or
Linkspan) by any Government Entity, or by persons acting or
purporting to act on behalf of any Government Entity, unless
- 40 -
the Ship or Linkspan be released and restored to the relevant
Shipowner, Stena Charterer or other charterer from such
hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation within one hundred and eighty (180)
days after the occurrence thereof;
"TRANSFER CERTIFICATE"
means a transfer certificate for the purposes of Clause 20.3
substantially in the form set out in Schedule 6 (or in such other form
as the Banks may approve or require);
"TRANSFEREE BANK" and "TRANSFEROR BANK"
shall have the meaning ascribed to those expressions in Clause 20.3;
"TRANSFERRED SHIP"
means a ship which was a Mortgaged Ship but the ownership or possession
of which has been transferred to a person which is not a Subsidiary of
Stena AB on Credit Terms so that either:-
(A) such person has obtained title thereto on terms that all or
part of the purchase price of the Ship is payable after the
date such person acquired title thereto; or
(B) such person will or may obtain title thereto under a hire
purchase or conditional sale agreement by payment of hire
payable in respect of the Ship and either by virtue of the
exercise of an option, or an obligation, to purchase such Ship
at the end of the hire period upon payment of a nominal sum or
final obligatory rental payment or a sum referrable to the
written down value or unamortised capital cost of the Ship
provided that a Ship shall cease to be a Transferred Ship for the
purposes of this Agreement if the Ship, having been sold by the
relevant Shipowner on hire purchase or conditional sale terms is
repossessed by the Shipowner following a default by the purchaser under
the relevant Commercial Documents or by agreement between the Shipowner
and the purchaser and is not required to be sold by the Shipowner
pursuant to its agreement with the relevant purchaser and the Ship
shall thereupon be treated as a Mortgaged Ship for all purposes of this
Agreement;
"UNENCUMBERED ASSETS"
means:-
(A) the P&O Stena Shares;
(B) the P&O Stena Loan Stock; and
(C) all the issued shares in the Borrower from time to time;
"UNRESTRICTED SUBSIDIARY"
means:-
(A) Stena Fastigheter;
(B) Stena Realty BV;
- 41 -
(C) any Subsidiary of Stena AB which Stena AB by resolution of its
Board of Directors shall classify as an Unrestricted
Subsidiary and, for this purpose, a Subsidiary of Stena AB may
only be classified as an Unrestricted Subsidiary if,
immediately after giving effect to such classification:-
(i) there would be no Default or Event of Default under
and as defined in the Indentures (or any applicable
Successor Financing);
(ii) such Subsidiary would have no Debt other than
Non-Recourse Debt, as certified in an Opinion of
Counsel delivered to the relevant trustee under each
Indenture or any Successor Financing;
(iii) Stena AB would be able to Incur at least $1.00 of
Debt pursuant to Clause 10.8;
(iv) such Subsidiary has no assets which are essential to
the operations of Stena AB and its Subsidiaries,
taken as a whole; and
(v) neither Stena AB nor any of its Subsidiaries has any
obligation:-
(a) to subscribe for additional shares of
Capital Stock or other equity interests of
such Subsidiary; or
(b) to maintain or preserve such Subsidiary's
financial condition or to cause such
Subsidiary to achieve certain levels of
operating results;
Provided however that:-
(x) any Subsidiary of Stena AB may not be
reclassified more than once in any thirteen
(13) month period;
(y) an Unrestricted Subsidiary may only be
reclassified as a Subsidiary of Stena AB if
immediately after giving effect to such
reclassification, there would be no Default
or Event of Default as defined in the
Indentures (or any applicable Successor
Financing); and
(z) any such classification or reclassification
shall be evidenced by, and shall become
effective upon, the filing with each
relevant trustee under the Indentures (or
any Successor Financing) of the resolution
of the Board of Directors of Stena AB giving
effect to such designation, an Officer's
Certificate certifying that such designation
complies with the applicable conditions set
forth above and, if applicable, the Opinion
of Counsel required under paragraph (C)(ii)
above, in each case in form and substance as
satisfactory to such trustee;
(D) any Subsidiary of an Unrestricted Subsidiary;
- 42 -
"UNSECURED REVOLVING CREDIT FACILITY AGREEMENT"
means the facility agreement dated of even date herewith made between
(1) Stena AB as borrower, (2) the banks and financial institutions
defined therein as "Banks" as lenders, (3) the Co-Arrangers as
arrangers and (4) Svenska Handelsbanken AB (publ) as agent pursuant to
which such lenders have agreed to make available to Stena AB a 364 day
unsecured revolving credit facility in the amount of two hundred
million Euro ((eurodollar) 200,000,000);
"VESSEL CONSTRUCTION CONTRACT"
means any contract for the construction (or construction and
acquisition) or conversion of a Vessel or Vessels entered into by Stena
AB or any Subsidiary of Stena AB;
"VESSELS"
means the shipping vessels whose primary purpose is the maritime
transportation of cargo and/or passengers or which are otherwise
engaged or used in any business activities of Stena AB and its
Subsidiaries permitted under Clause 10.12 (including, without
limitation, semi-submersible and other drilling rigs and drillships)
and which are owned by and registered (or to be owned by and
registered) in the name of Stena AB or any of its Subsidiaries or
operated by Stena AB or any of its Subsidiaries pursuant to a lease or
other operating agreement constituting a Capitalised Lease Obligation,
in each case together with all related equipment and any additions or
improvements;
"VOTING STOCK"
of any person means Capital Stock of such person which ordinarily has
voting power for the election of directors (or persons performing
similar functions) of such person, whether at all times or only so long
as no senior class of securities has such voting power by reason of any
contingency; and
"WHOLLY OWNED SUBSIDIARY"
of any person means a Subsidiary of such person all of the outstanding
Capital Stock or other ownership interests of which (other than
directors' qualifying shares) shall at the time be owned by such person
or by one or more Wholly Owned Subsidiaries of such person or by such
person and one or more Wholly Owned Subsidiaries of such person.
1.3 Insurance terms
In Clause 11:-
(A) "EXCESS RISKS" means the proportion (if any) of claims for
general average, salvage and salvage charges and under the
ordinary collision clause not recoverable in consequence of
the value at which a Ship is assessed for the purpose of such
claims exceeding her insured value;
(B) "PROTECTION AND INDEMNITY RISKS" means:-
(i) the usual risks (including oil pollution) covered by
a United Kingdom protection and indemnity association
or a protection and indemnity association which is
managed in London, Norway or Sweden or is a
- 43 -
member of the "International Group" of protection and
indemnity associations (including, without
limitation, the maximum proportion (if any) of any
sums payable to any other person or persons in case
of collision which are not recoverable under the hull
and machinery policies by reason of the incorporation
therein of Clause 1 of the Institute Time Clauses
(Hulls) (1/11/95) or the Institute Amended Running
Down Clause (1/10/71) or any equivalent provision; or
(ii) (if placed on Norwegian terms) means protection and
indemnity risks as defined in the Norwegian Marine
Insurance Plan of 1996 as amended; and
(C) "WAR RISKS" includes those risks covered by the standard form
of English marine policy with Institute War and Strikes
Clauses (Time) (1/10/83) attached or similar cover which may
be insured by entry with such association or (if placed on
Norwegian terms) means the war risks described in the
Norwegian Marine Insurance Plan of 1996 as amended or (if
placed on Swedish terms) means the Swedish War Insurance
Conditions for Ships 1992/01/01;
1.4 Accounting terms
All accounting terms not otherwise defined in this Agreement shall have
the meanings assigned to them in accordance with Swedish GAAP where
used in relation to the Stena AB Group and Dutch GAAP where used in
relation to the Stena International Group (whether or not such is
indicated in this Agreement).
1.5 Headings
Clause headings and the table of contents are inserted for convenience
of reference only and shall be ignored in the interpretation of this
Agreement.
1.6 Construction of certain terms
In any Security Document unless the context otherwise requires:-
(A) references to Clauses and Schedules are to be construed as
references to Clauses of, and Schedules to, such Security
Document and references to such Security Document include its
Schedules;
(B) references to (or to any specified provision of) any Security
Document or any other document shall be construed as
references to such Security Document, that provision or that
document as in force for the time being and as novated and/or
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 any Security Document or the
relevant document, required to be obtained as a condition to
such amendment) with the consent of the Agent;
(C) references to a "regulation" include any present or future
regulation, rule, directive, requirement, request or guideline
(whether or not having the force of law) of any agency,
authority, central bank or government department or any
self-regulatory or other national or supra-national authority;
- 44 -
(D) words importing the plural shall include the singular and vice
versa;
(E) references to a time of day are to London time;
(F) references to a person shall be construed as references to an
individual, firm, company, corporation, unincorporated body of
persons or any Government Entity;
(G) references to any person includes such person's assignees and
successors in title; and
(H) references to any enactment shall be deemed to include
references to such enactment as re-enacted, amended or
extended.
1.7 Consents and approvals
(A) Where any matter requires the approval or consent of the Agent
and/or the Security Agent and/or the Banks, such approval or
consent shall not be deemed to have been given unless given in
writing.
(B) Unless the context otherwise expressly states to the contrary,
where in any Security Document any party is required or
requested to consent or agree to, authorise or approve,
either with or without conditions, or give an opinion or
express satisfaction or certify, make payments, determinations
or determine requirements in any such case at its discretion,
then it is hereby agreed that such consent, agreement,
authorisation, approval, conditions, opinion, expression of
satisfaction, certification, determination, payment or
requirement shall not (when taking into account all the
circumstances) be unreasonably withheld, imposed, given or
determined. Where in any Security Document the Agent, the
Co-Arrangers, the Security Agent or any of the Banks is
required to give any notice, document or other information
or to do any act or thing (unless the context otherwise
expressly states to the contrary) such notice, document or
other information shall be given and such act or thing shall
be done as soon as is reasonably practicable.
1.8 Conflict with Facility Agreement
In the event of any conflict between the provisions of this Agreement
and any other of the Security Documents, the provisions of this
Agreement shall prevail.
1.9 Majority Banks
Where this Agreement provides for any matter to be determined by
reference to the opinion of the Majority Banks or to be subject to the
consent or request of the Majority Banks or for any action to be taken
on the instructions of the Majority Banks, such opinion, consent,
request or instructions shall (as between the Banks) only be regarded
as having been validly given or issued by the Majority Banks if all the
Banks shall have received prior notice of the matter on which such
opinion, consent, request or instructions are required to be obtained
and the relevant majority of Banks shall have given or issued such
opinion, consent, request or instructions but so that the Borrower
shall be entitled (and bound) to assume that such notice shall
- 45 -
have been duly received by each Bank and that the relevant majority
shall have been obtained to constitute Majority Banks whether or not
this is in fact the case.
1.10 Transfer and Succession
In this Agreement all references to the Agent, the Security Agent, the
Banks and/or the Co-Arrangers shall in each case include:-
(A) any successor in title to or assignee or transferee of all or
any portion of that respective party's rights, title and
interest in, to and under this Agreement including any
Transferee to whom all or part of such person's rights and
obligations hereunder are transferred; and
(B) any other person whomsoever in whose favour all or any portion
of such rights, title and interest are transferred including
any person who becomes a party to this Agreement by way of a
novation hereof
and the expression "Bank" shall include any such person aforesaid
notwithstanding that such person may have made no advance to the
Borrower hereunder and notwithstanding also that the indebtedness of
the Borrower to such person may be operation of law or otherwise
constitute, or be deemed to constitute, an indebtedness separate and
distinct from the indebtedness arising on the date of drawing of the
Commitment in respect of which the assignment or other transfer of
rights, title and interest is made.
2. THE COMMITMENTS
2.1 Agreement to lend
Upon and subject to the terms and conditions of this Agreement and in
reliance on the representations and warranties in Clause 9 the Banks
agree to lend Advances to the Borrower and the obligation of each Bank
under this Agreement shall be to contribute its Percentage of each
Advance.
2.2 Obligations of Banks several
The obligations of each Bank under this Agreement are several; the
failure of any Bank to perform such obligations shall not relieve any
other Bank, the Co-Arrangers, the Agent, the Security Agent or the
Borrower of any of their respective obligations or liabilities under
this Agreement nor shall the Co-Arrangers, the Agent or the Security
Agent be responsible for the obligations of any Bank (except for its
own obligations, if any, as a Bank) nor shall any Bank be responsible
for the obligations of any other Bank under this Agreement. Provided
that, in the event of the failure of any Bank (the "defaulting Bank")
to perform its obligations under this Agreement:-
(A) the Agent shall consult with the Borrower and the other Banks
with a view to taking steps to mitigate the effects of such
default including the procuring of another bank to assume the
obligations of the defaulting Bank; and
(B) the defaulting Bank shall indemnify the Borrower against any
losses, costs and expenses which the Borrower may sustain or
incur as a result of such failure.
- 46 -
2.3 Interests several
Notwithstanding any other term of this Agreement (but without prejudice
to Clause 21.4 (I) or the provisions of this Agreement relating to or
requiring action by the Majority Banks) the interests of the
Co-Arrangers, the Agent, the Security Agent and the Banks are several
and the amount due to the Co-Arrangers, the Agent, the Security Agent
and each Bank (each for its own account) is a separate and independent
debt. The Co-Arrangers, the Agent, the Security Agent and each Bank
shall have the right to protect and enforce its rights arising out of
this Agreement and it shall not be necessary for the Co-Arrangers, the
Agent, the Security Agent or any Bank (as the case may be) to be joined
as an additional party in any proceedings for this purpose.
3. ADVANCES
3.1 Drawdown
Subject to the terms and conditions of this Agreement, an Advance may
be made to the Borrower following receipt by the Agent from the
Borrower of a Drawdown Notice not later than 10.00 a.m. on the third
Banking Day before the date on which the Advance is intended to be made
which shall be a Banking Day falling within the Availability Period. A
Drawdown Notice shall be effective on actual receipt by the Agent and,
once given, shall, subject as provided in Clause 4.5(A), be
irrevocable. No Drawdown Notice may be given in respect of an amount
which is the subject of a notice of cancellation under Clause 5.
3.2 Amount
Each Advance shall be a minimum of $10,000,000 and an integral multiple
of $5,000,000 or the balance of the Available Commitments or such other
amount (not exceeding the Available Commitments) as the Banks may agree
but no Advance may be drawn down on any day of an amount exceeding the
Available Commitments on such day, taking into account for this purpose
any Advance to be repaid on such day and any other Advance which is to
be made which is the subject of a current Drawdown Notice.
3.3 Term
Subject to Clause 3.6, Advances may be borrowed only for a Term of one
(1), three (3), six (6), nine (9) or twelve (12) months or such other
period as the Banks may agree, in each case ending on or before the
Termination Date.
3.4 Availability
Upon receipt of a Drawdown Notice complying with the terms of this
Agreement the Agent shall notify each Bank thereof and of the date on
which the Advance is to be made and, subject to the provisions of
Clause 14, on such date each of the Banks shall make available to the
Agent its portion of such Advance for payment by the Agent in
accordance with Clause 7.2. Except with the Banks' consent, no Advances
shall be made to the Borrower under this Agreement after the date
falling one (1) month before the Termination Date.
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3.5 The Termination Date
Without prejudice to any other provisions of this Agreement, the
Commitments shall in any event be reduced to zero on the Termination
Date and no Advances shall be made to the Borrower under this Agreement
thereafter.
3.6 Number of Advances
Notwithstanding the provisions of Clauses 3.2 and 3.3, Advances may be
drawn only so that the number of separate Advances outstanding at any
time does not exceed fifteen (15) or such other number as may be agreed
by all the Banks or so that on the Maturity Date in respect of the next
Advance to be repaid the number of Advances outstanding (excluding
those repayable on such Maturity Date) will not exceed fifteen (15) or
such other number as may be agreed by all the Banks. No more than
twelve (12) Terms of one month (or, if agreed by the Banks, any shorter
period) may be selected by the Borrower in respect of Advances during
any calendar year.
3.7 Application of proceeds
Without prejudice to the Borrower's obligations under Clause 10.19,
none of the Banks, the Co-Arrangers or the Agent shall have any
responsibility for the application of proceeds of any Advance by the
Borrower.
4. INTEREST ON ADVANCES
4.1 Normal interest rate
The Borrower shall pay interest on each Advance on its Maturity Date
(or, in the case of an Advance having a Term of more than six (6)
months, by instalments, the first six (6) months from the drawdown of
such Advance and the subsequent instalments at intervals of six (6)
months or, if shorter, the period from the date of the preceding
instalment until the relevant Maturity Date) at the rate per annum
determined by the Agent to be the aggregate of (i) the Margin and (ii)
LIBOR
PROVIDED HOWEVER THAT, in the case of any Advance which is borrowed for
a Term of one month or less, the amount of interest payable in respect
thereof shall be that amount which is the higher of:-
(A) the amount of interest which would be payable thereon if
calculated at the interest rate specified in the foregoing
provisions of this Clause 4.1; and
(B) the amount which is equal to the aggregate of (i) that amount
of interest which would be payable thereon pursuant to the
foregoing provisions of this Clause 4.1 if the Margin were
zero and (ii) eight thousand three hundred and thirty three
Dollars ($8,333).
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4.2 Default interest
If the Borrower fails to pay any sum (including, without limitation,
any sum payable pursuant to this Clause 4.2) on its due date for
payment under 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 pursuant to this Clause 4.2. The period beginning on such
due date and ending on such date of payment shall be divided into
successive periods of not more than three (3) months as selected by the
Agent (after consultation with the Banks) each of which (other than the
first, which shall commence on such due date) shall commence on the
last day of the preceding such period. The rate of interest applicable
to each such period shall be the aggregate (as determined by the Agent)
of (i) two point seven five per cent (2.75%) per annum and (ii) LIBOR
for such period provided that if such unpaid sum is an amount of
principal which became due and payable, by reason of a declaration by
the Agent under Clause 15.2 or a prepayment pursuant to Clauses 5.3,
5.6, 5.7, 5.9 or 17.1 on a date other than a Maturity 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 Maturity Date and interest shall be payable on such principal
sum during such period at a rate of two point seven five per cent
(2.75%) above the rate of LIBOR applicable thereto immediately before
it shall have become so due and payable. Default interest shall be due
and payable on the last day of each such period as determined by the
Agent pursuant to this Clause 4.2 or, if earlier, on the date on which
the sum in respect of which such default interest is accruing shall
actually be paid. If, for the reasons specified in Clause 4.5(A), the
Agent is unable to determine a rate in accordance with the foregoing
provisions of this Clause 4.2, each Bank shall promptly notify the
Agent of the cost of funds to such Bank and interest on any sum not
paid on its due date for payment shall be calculated for each Bank at a
rate determined by the Agent to be two point seven five per cent
(2.75%) per annum above the cost of funds to such Bank. Each Bank shall
(without prejudice to the obligation of the Borrower to pay such
interest) provide reasonable detail as to the basis on which it has
determined such cost of funds.
4.3 Notification of interest rate
The Agent shall notify the Borrower promptly of each rate of interest
determined by it under this Clause 4.
4.4 Reference Bank quotations
If any Reference Bank is unable or otherwise fails to furnish a
quotation for the purpose of calculating LIBOR pursuant to the proviso
contained in the definition of LIBOR the interest rate shall be
determined, subject to Clause 4.5, on the basis of the quotations
furnished by the remaining Reference Banks.
4.5 Market disruption; non-availability
(A) If and whenever, at any time prior to the making of an Advance:-
- 49 -
(i) the Agent shall have determined (which determination
shall, in the absence of manifest error, be
conclusive) that adequate and fair means do not exist
for ascertaining LIBOR during the Term of that
Advance;
(ii) where applicable, none of the Reference Banks
supplies the Agent with a quotation for the purpose
of calculating LIBOR; or
(iii) the Agent shall have received notification from Banks
with Commitments aggregating not less than one-half
of the total of the Commitments (or, if no Advance
has been made, Commitments aggregating not less than
one-half of the Commitments of all the Banks) that
deposits in Dollars are not available to such Banks
in the London Interbank Market in the ordinary course
of business in sufficient amounts to fund their
Contributions to such Advance or, where applicable,
that the arithmetic mean of the quotations for LIBOR
supplied by the Reference Banks does not accurately
reflect the cost to such Banks of obtaining such
deposits,
the Agent shall forthwith give notice (a "DETERMINATION
NOTICE") thereof to the Borrower and to each of the Banks and
such Advance shall not be made. A Determination Notice shall
contain particulars of the relevant circumstances giving rise
to its issue.
(B) After the giving of any Determination Notice no further
Advances may be borrowed until notice to the contrary is given
to the Borrower by the Agent.
(C) During the period of twenty (20) days following the giving of
any Determination Notice, the Borrower and the Agent in
consultation with the Banks shall negotiate in good faith in
order to arrive at a mutually acceptable substitute basis for
each Bank to continue its Contribution to any further Advances
and, if within such twenty (20) day period the Borrower and
the Agent (in consultation as aforesaid) shall agree in
writing upon such an alternative basis (the "SUBSTITUTE
BASIS") the Substitute Basis shall be retroactive to and
effective from the first day of the relevant Term.
(D) If the Borrower and the Agent (in consultation with the Banks)
fail to agree on a Substitute Basis within such twenty (20)
day period, the Borrower shall pay interest on the Advances to
each Bank at the rate certified by each such Bank and notified
through the Agent to the Borrower as being a reasonable
interest rate reflecting the cost to such Bank of funding its
Contribution to such Advances during the period from the date
of the relevant Determination Notice, plus the Margin and such
rate plus the Margin shall be the Substitute Basis.
(E) So long as any Substitute Basis is in force, the Agent shall
from time to time (but at least monthly) and in consultation
with the Banks review whether or not the circumstances are
such that such Substitute Basis is no longer necessary and, if
the Agent so determines it shall notify the Borrower and the
Banks that the Substitute Basis shall cease to be effective
from such date as the Agent shall reasonably specify.
- 50 -
5. REPAYMENT, REDUCTION AND CANCELLATION
5.1 Repayment of Advances
The Borrower shall repay each Advance on its Maturity Date. If an
Advance (the "NEW ADVANCE") is to be made on a day on which another
Advance (the "MATURING ADVANCE") is due to be repaid then, subject to
the terms of this Agreement, (i) the maturing Advance shall be deemed
to have been repaid on its Maturity Date either in whole (if the new
Advance is equal to or greater than the maturing Advance) or in part
(if the new Advance is less than the maturing Advance) and (ii) to the
extent that the maturing Advance is so deemed to have been repaid, the
principal amount of the new Advance to be made on such date shall be
deemed to have been credited to the account of the Borrower by the
Agent on behalf of the Banks in accordance with the terms of this
Agreement and the Banks shall only be obliged to make available to the
Borrower pursuant to Clause 3 a principal amount equal to the amount by
which the new Advance exceeds the maturing Advance. On the Termination
Date, all outstanding Advances and other sums (if any) then owing under
this Agreement shall in any event be repaid or paid in full.
5.2 Scheduled reductions of Commitments
Without prejudice to any other provision of this Agreement, the
Commitments shall be reduced in aggregate by the following amounts on
the following dates:-
(A) on the date falling twelve (12) months after the date of this
Agreement, by $30,000,000 or, if lower, by an amount in
Dollars equal to 30/275ths of the then aggregate amount of the
Commitments;
(B) on the date falling twenty four (24) months after the date of
this Agreement, by $30,000,000 or, if lower, by an amount in
Dollars equal to 30/245ths of the then aggregate amount of the
Commitments;
(C) on the date falling thirty six (36) months after the date of
this Agreement, by $30,000,000 or, if lower, by an amount in
Dollars equal to 30/215ths of the then aggregate amount of the
Commitments;
(D) on the date falling forty eight (48) months after the date of
this Agreement, by $30,000,000 or, if lower, by an amount in
Dollars equal to 30/185ths of the then aggregate amount of the
Commitments;
(E) on the Termination Date by the whole of the aggregate amount
of the Commitments so that all of the Commitments shall be
reduced to zero on such date.
5.3 Reduction of Commitments on Total Loss or sale or by receipt of
instalments
(A) Total Loss or sale of Mortgaged Ships
If a Mortgaged Ship is sold or becomes a Total Loss, the
Commitments shall, subject to Clause 5.3(E), be reduced on the
Disposal Reduction Date for such Ship by the relevant Disposal
Reduction Amount.
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(B) Transferred Ships
On each Disposal Reduction Date applicable to a Transferred
Ship, the Commitments shall, subject to Clause 5.3(E), be
reduced by the relevant Disposal Reduction Amount.
(C) Sale of Mortgaged Ports and/or Port Owner
If a Mortgaged Port or any part thereof is sold (other than
any part of a Mortgaged Port which is sold for a consideration
of less than $25,000 or the equivalent thereof in any other
currency), or any of the shares in the capital of any Port
Owner are sold, the aggregate amount of the Commitments shall,
subject to Clause 5.3(E), be reduced on the Disposal Reduction
Date relating thereto by the relevant Disposal Reduction
Amount.
(D) Prepayment upon reduction of Commitments
If, upon reduction or suspension of the Commitments by any
such Disposal Reduction Amount, the aggregate of the Advances
at such time exceeds the Commitments as thereby reduced or
after deduction of the amount to be suspended as the case may
be, the Borrower shall on such Disposal Reduction Date prepay
such amount of the outstanding Advances as will ensure that
immediately thereafter the aggregate amount of the Advances
will not exceed the Commitments as so reduced or after
deduction of the amount to be suspended as the case may be.
(E) Substitute security
(i) Without prejudice to the Borrower's obligation to
make any payment due under Clause 5.3(D) the
Commitments shall be suspended for a period of up to
twelve (12) months from the relevant Disposal
Reduction Date in an amount equal to the relevant
Disposal Reduction Amount. The Borrower shall
within such twelve (12) month period provide the
Security Agent with substitute security with a value
equal to the Disposal Reduction Amount (adjusted if
appropriate in accordance with the following
provisions of this paragraph). On the Agent giving
notice to the Borrower and the Banks that such
security has been duly granted, the relevant amount
of the Commitments shall cease to be suspended by the
Disposal Reduction Amount previously suspended
(adjusted if appropriate in accordance with the
following provisions of this paragraph) or such
lesser amount as the Borrower requests, but so that
the Commitments may not at any time exceed the amount
of the Commitments as they would have stood but for
the suspension of part thereof and taking into
account reductions and cancellations by virtue of the
other provisions of this Agreement. For the purpose
of this paragraph (i) the Disposal Reduction Amount
shall be reduced during the period of the suspension
in proportion to the reduction of the Commitments
(including the suspended portions) which takes effect
by virtue of any reduction or partial cancellation in
respect of the Commitments which takes effect during
the period of the suspension by virtue of the other
provisions of this Agreement.
- 52 -
(ii) The Borrower's obligation to provide substitute
security in relation to an amount of the Commitments
suspended by virtue of this Clause 5.3(E) shall be
deemed discharged if the relevant member of the Stena
AB Group provides security over a Vessel (a
"SUBSTITUTE VESSEL") owned by such member of the
Stena AB Group if the following conditions are
satisfied:-
(a) the relevant member of the Stena AB Group has
executed a Shipowner's Guarantee in favour of
the Security Agent and a Ship Mortgage (the
"SUBSTITUTE MORTGAGE") and either a Deed of
Covenant or an Insurance Assignment in respect
of the Substitute Vessel in substantially the
forms of Schedule 11.1 and Schedule 9;
(b) the market value of the Substitute Vessel
(determined in accordance with Clause 5.3(G)) is
not less than one hundred and fifty per cent
(150%) of the relevant amount suspended by
virtue of paragraph (i) of this Clause as
reduced or cancelled by virtue of the other
provisions of this Agreement;
(c) the Substitute Vessel is registered under the
laws and flag of an Approved Flag State;
(d) the Agent shall have received the documents and
evidence referred to in Clause 19.5(F) in
relation to the Substitute Vessel.
If the Borrower provides substitute security in any
other form such security shall be in such form and
constituted in such manner as shall be in all
respects satisfactory to the Majority Banks.
(iii) To the extent that the Borrower does not grant or
procure the grant of additional security as provided
in this Clause 5.3(E) or cancel the whole or part of
the suspended amount under paragraph (iv) of this
Clause 5.3(E) within the period of twelve (12) months
after the relevant Disposal Reduction Date, then the
Commitments shall be treated as permanently reduced
by the suspended amount or lesser amount in respect
of which the Borrower has not granted or procured the
grant of substitute security in accordance with the
preceding provisions of this Clause 5.3(E).
(iv) The Borrower may, during any period for which a part
of the Commitments is suspended under this Clause
5.3(E), by notice to the Agent cancel with effect
from a date not less than thirty (30) days after the
receipt by the Agent of such notice in whole or part
(being $1,000,000 or any larger sum which is an
integral multiple of $1,000,000) of the suspended
amount. Any such notice of cancellation, once given,
shall be irrevocable and upon such cancellation
taking effect the Commitment of each of the Banks
shall be reduced proportionately.
- 53 -
(v) Nothing in this Clause 5.3(E) shall affect the
Borrower's obligation to procure that all amounts
realised from the property pledged to the Security
Agent as security under the Security Documents shall,
after an Event of Default has occurred and is
continuing, be applied in payment of the relevant
Disposal Reduction Amounts and, following a
declaration by the Agent under Clause 15.2, be
applied in accordance with Clause 7.10.
(F) Defined terms
For the purposes of this Clause 5.3:-
"DISPOSAL REDUCTION AMOUNT" means:-
(x) in relation to a Mortgaged Ship which has become a
Total Loss or is sold, an amount in Dollars which is
the lesser of:-
(i) (aa) where the Ship has become a
Total Loss, the minimum amount for
which such Ship was required to have
been insured under the Security
Documents less any applicable
deductible, collection commissions
and any other expenses incurred by
the relevant Shipowner or Stena
Charterer or third party demise
charterer in recovering under the
Insurances of the Ship in respect of
such Total Loss and/or recovering
any Requisition Compensation in
respect thereof; or
(bb) where the Ship has been sold
(otherwise than on Credit Terms) the
Net Cash Sale Proceeds of such Ship
and (if relevant) its related
Linkspans; and
(ii) such amount (if any) as will, after
reduction of the Commitments and, if
required by Clause 5.3(B), after any
prepayment of Advances on the Disposal
Reduction Date for such Ship, result in the
Security Value being not less than one
hundred and fifty per cent (150%) of the
aggregate total of the Commitments (as so
reduced);
(y) in relation to a Transferred Ship, an amount in
Dollars which is the lesser of:-
(i) (aa) if the Ship has become a Total
Loss, the amount which the seller or
lessor of the Ship is contractually
entitled as against the relevant
purchaser or lessee (as the case may
be) to receive, and has received,
from the Insurances of the Ship less
any part thereof due to, or
belonging to, or by reference to
which a payment is to be made to,
the purchaser or lessee (as the case
may be); or
- 54 -
(bb) if the Ship is sold pursuant to a
power conferred on the mortgagee or
lessor thereof, or an obligation on
the lessor thereof, following a
default by the purchaser or lessee,
the net sale proceeds of the Ship
received by the mortgagee or lessor
(after deducting the costs and
out-of-pocket expenses incurred in
connection with the sale) less any
part thereof due to, or belonging
to, or by reference to which a
payment is to be made to, the
purchaser or lessee (as the case may
be);
(cc) in any other case the amount of
deferred payment instalments, rent
or other deferred consideration
received since the drawdown date of
the first Advance or, as the case
may be, the preceding Disposal
Reduction Date by the member of the
Stena AB Group which has disposed of
the relevant Ship;
(dd) if, following a default by the
purchaser or lessee of the Ship
under an agreement for the sale of
the Ship on Credit Terms or the
agreed early termination thereof the
agreement is validly terminated, and
the Ship is sold by the Shipowner
following the default or agreed
early termination the amount
received by the Shipowner by way of
damages for breach of the agreement
(or any payment received by the
Shipowner or Stena Charterers on the
compromise of legal proceedings in
respect of such breach) or
compensation for early termination;
and
(ii) the amount referred to in paragraph (x)(ii)
of this Clause 5.3(F); and
(z) in relation to any Mortgaged Port or part of a
Mortgaged Port (other than any such part sold for a
consideration of less than $25,000 or the equivalent
thereof in any other currency) and/or any shares in
the capital of a Port Owner which is or are sold, an
amount in Dollars which is the lesser of:-
(i) the Net Cash Sale Proceeds thereof; and
(ii) the amount referred to in paragraph (x)(ii)
of this Clause 5.3(F).
However, if the Security Value has not been determined by the
relevant Disposal Reduction Date, the Disposal Reduction
Amount shall be the amount referred to in sub-paragraph
(x)(i), (y)(i) or (z)(i) (as the case may be) of this
definition, provided that if, no later than thirty (30) days
after such Disposal Reduction Date, the Borrower demonstrates
to the Agent's satisfaction that, on the basis of the Security
Value as at the relevant Disposal Reduction Date, a lower
Disposal Reduction Amount would have applied at such date,
such lower Disposal Reduction Amount shall, for the purposes
of determining the respective Commitments of the Banks and for
all other relevant purposes of
- 55 -
this Agreement, be deemed to have applied on and from such
Disposal Reduction Date;
"SECURITY VALUE" means the amount in Dollars (as certified by
the Agent whose certificate shall, in the absence of manifest
error, be conclusive and binding on the parties hereto) which,
at any relevant time, is the aggregate of:
(w) the market value of all the Owned Ships which are
then Mortgaged Ships (together with their related
Linkspans, if any, but only if they are Mortgaged
Linkspans) determined in accordance with Clause
5.3(G) provided that if the Ship Mortgage on any such
Owned Ship or the Linkspan Mortgage on such Linkspan
(as the case may be) is restricted to a registered
maximum amount recoverable thereunder then such
maximum mortgage amount shall be used towards
calculating the Security Value if it is lower than
the market value determined as aforesaid in respect
of such Owned Ship or Linkspan provided further that,
in the case of m.v. "STENA GERMANICA", if the
principal amount due under the Stena Germanica Loan
Agreement is less than the market value of the Ship
and the registered maximum amount recoverable under
the Stena Germanica Mortgage then such principal
amount shall be used towards calculating the Security
Value in respect of such Ship;
(x) in the case of a Transferred Ship which is sold on
terms which provide for capital payments to be paid
over a period of time together with interest at an
agreed rate or let on hire purchase terms where the
rentals are calculated by reference to an inherent
rate of interest, the aggregate amount of the capital
payments or the capital element of such payments
payable in respect of the Ship during the period for
which such payments are to be made under the relevant
Commercial Documents;
(y) in the case of a Transferred Ship which is sold or
let on hire purchase terms and the relevant
Commercial Documents do not distinguish between
capital and interest payments inherent in the
instalment or rental payments made the aggregate of
the payments payable in respect of the Ship during
the period for which such payments are to be made
under the relevant Commercial Documents, discounted
to their net present value at a discount rate
certified by an Officer's Certificate as the average
cost of funds of the Stena AB Group as at the date on
which the Asset Disposition affecting the relevant
ship is completed and in the case that any of the
above are initially expressed in a currency other
than Dollars the relevant value shall be taken to be
the amount in Dollars obtained by converting the
amount in foreign currency at the Agent's spot rate
for the purchase of the relevant foreign currency
with Dollars as at the date of determination of the
Security Value;
(z) the market value of the Ports which are then subject
to a Port Mortgage determined in accordance with
Clause 5.3(H) unless the Port Mortgage on any such
Port is restricted to a registered maximum amount
- 56 -
recoverable thereunder in which case such maximum
mortgage amount shall be used towards calculating the
Security Value if it is lower than the market value
determined as aforesaid in respect of such Port.
(G) Valuation of Ships and Linkspans
The value of each Mortgaged Ship shall be determined as being
the mortgage free value thereof after deduction of the
aggregate amount of any mortgage debt secured thereon in
favour of any creditor other than the Security Agent and, in
the case of m.v. "STENA CARISMA" and any other Ship which may
become a Mortgaged Ship and which requires the use of
Linkspans for its operation, such value shall be taken as the
mortgage free value thereof together with the book value of
its related Linkspans (but only if they are Mortgaged
Linkspans) as shown in the then latest Asset Coverage
Compliance Certificate delivered to the Agent. For these
purposes, the mortgage free value of each such Ship (together,
if relevant, with its Linkspans) shall be the mean of the
valuations of the charter-free market value thereof on a
willing buyer/willing seller basis as assessed as at the
relevant date by three leading European shipbrokers active in
the ro-ro/ferry market appointed by the Borrower from the
following list of brokers:-
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ Shipping HB
Simsonship AB
Maersk Sales
Parimar Francharte S.A.
English White Shipping Ltd.
Nor Ocean
or any other broker nominated by the Borrower and approved by
the Agent.
Valuations of each Mortgaged Ship and each Mortgaged Linkspan
shall be obtained once annually as at 30 December 2001 and as
at the dates falling at twelve (12) monthly intervals
thereafter and as at any other Disposal Reduction Date (which
valuations are to be received by the Agent within twenty one
(21) days after the relevant dates) provided however that
where a Disposal Reduction Date occurs within six (6) months
of a previous valuation pursuant to this Clause 5.3(G), the
value of each such Ship or Linkspan shall be the value
previously determined pursuant to this Clause 5.3(G) and no
further valuations shall be obtained for the relevant Disposal
Reduction Date unless required by the Borrower.
(H) Valuation of Holyhead Port and Stranraer Port
The value of each Port shall be the amount (expressed in
Dollars by reference to exchange rates prevailing on the day
of computation of the Security Value) determined as the
earnings before interest, taxes, depreciation and amortisation
in respect of such Port for the previous period of twelve (12)
months as shown in the documents relating to such Port most
recently delivered to and accepted by the Agent pursuant to
Clause 10.2(E) multiplied by six and one half (6.5) provided
that if the Agent on the instructions of the
- 57 -
Majority Banks gives notice to the Borrower that the
foregoing does not represent a fair market value of Holyhead
Port and/or Stranraer Port the value shall be determined by
the auditors of the Borrower or such other firm of auditors
as the Agent shall on the instructions of the Majority Banks
appoint on a basis which in the opinion of such auditors
provides a Fair Market Valuation in accordance with the
practice adopted by auditors in valuing similar port
facilities in the United Kingdom.
The foregoing procedure shall also be used to value any other
Port which may from time to time be subject to a Port Mortgage
in favour of the Security Agent.
The initial values in Sterling of Holyhead Port and Stranraer
Port (computed in accordance with the foregoing procedure for
each Port for the twelve (12) month period ended 31 December
2000) shall be (pound)66,300,000 and (pound)17,600,000
respectively.
(I) Valuation costs
The reasonable costs of valuations carried out pursuant to
this Clause 5.3 shall be reimbursed by the Borrower to the
Agent on the Agent's request.
(J) Date of Total Loss
For the purpose of this Agreement, a Total Loss shall be
deemed to have occurred:-
(i) in the case of an actual total loss of a Ship or
Linkspan on the actual date and at the time such Ship
or Linkspan was lost or, if such date is not known,
on the date on which the Ship or Linkspan was last
reported;
(ii) in the case of a constructive total loss of a Ship or
Linkspan, upon the date and at the time notice of
abandonment of such Ship or Linkspan is given to the
insurers of such Ship or Linkspan for the time being
(provided a claim for total loss is admitted by such
insurers) or, if such insurers do not forthwith admit
such a claim, at the date and at the time at which
either a total loss is subsequently admitted by the
insurers or a total loss is subsequently adjudged by
a competent court of law or arbitration panel to have
occurred or, if earlier, the date falling six (6)
months after notice of abandonment of such Ship or
Linkspan was given to the insurers;
(iii) in the case of a compromised or arranged total loss,
on the date upon which a binding agreement as to such
compromised or arranged total loss has been entered
into by the insurers of the relevant Ship or
Linkspan;
(iv) in the case of Compulsory Acquisition of a Ship or
Linkspan, on the date upon which the relevant
requisition of title or other compulsory acquisition
of such Ship or Linkspan occurs; and
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(v) in the case of hijacking, theft, condemnation,
capture, seizure, arrest, detention or confiscation
of a Ship or Linkspan (other than where the same
amounts to Compulsory Acquisition of such Ship or
Linkspan) by any Government Entity, or by persons
purporting to act on behalf of any Government Entity,
which deprives the relevant Shipowner of the use or
the relevant Stena Charterer or third party demise
charterer of such Ship or Linkspan for more than one
hundred and eighty (180) days, upon the expiry of the
period of one hundred and eighty (180) days after the
date upon which the relevant hijacking, theft,
condemnation, capture, seizure, arrest, detention or
confiscation occurred.
(K) Application of Total Loss and sale proceeds
Provided no Event of Default has occurred and is continuing,
and provided the Borrower shall have complied with Clauses 5.3
and 5.4, any insurance moneys or Requisition Compensation or
proceeds of sale received by the Agent or the Security Agent
in respect of a Total Loss of a Ship or sale of a Mortgaged
Ship or Mortgaged Port or Mortgaged Linkspan under the
relevant Security Documents or in consideration of the
agreement of the Security Agent to release its security in
relation to any Ship or Port shall be paid to the relevant
mortgagor or assignor or (if and to the extent necessary to
ensure compliance with Clause 5.3) retained by the Agent for
application in or towards making any prepayment and paying any
other moneys required under Clauses 5.3 and 5.4. For this
purpose, any such insurance moneys or Requisition Compensation
or proceeds of sale so received (or the relevant part thereof)
may be applied, if the relevant mortgagor or assignor so
requests the Agent in writing before the date of receipt
thereof, in effecting any prepayment required in accordance
with Clause 5.3 and paying related amounts due under Clause
5.4 provided that in relation to any Transferred Ships the
references in this Clause 5.3(K) to sale proceeds, insurance
moneys and Requisition Compensation shall be deemed to refer
to the moneys received by the Security Agent under the
relevant Receivables Assignment. Pending each Disposal
Reduction Date in relation thereto such moneys shall be
accumulated in an account of the relevant assignor with the
Agent and the balance thereof after making applications
required by Clauses 5.3 and 5.4 shall, provided no Event of
Default has occurred and is continuing or would be occasioned
thereby, be released to the relevant assignor on the relevant
Disposal Reduction Date or as soon thereafter as is reasonably
practicable.
(L) Sale of Ships on Credit Terms
Where a Shipowner sells its Mortgaged Ship on Credit Terms,
the relevant Shipowner shall before completion of the sale (in
the case of a credit sale) or delivery of the Ship to the
relevant charterer (in the case of a hire purchase or
conditional sale) execute and deliver to the Security Agent an
assignment in substantially the form of the Receivables
Assignment of the amounts receivable in respect of the sale or
letting of the Ship and all security granted to such Shipowner
in respect of the obligation of the buyer to pay the
outstanding balance of the purchase price or rentals and the
option price under any relevant hire purchase agreement in
respect of such Ship. Where the Ship
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is sold pursuant to a credit sale or other arrangement under
which the purchaser acquires title to the Ship, such
security shall in any event include either:-
(i) a first priority mortgage in favour of the seller of
the Ship constituted under the laws of an Approved
Flag State and a first priority assignment in favour
of the seller of the Insurances of the Ship which
shall be placed on terms which are not materially
less favourable to the seller than the terms set out
in the form of Deed of Covenant in Schedule 11.1 in
the case of mortgage covenants and the terms set out
in Schedule 9 in the case of an Insurance Assignment;
or
(ii) a bank guarantee from a first class international
bank guaranteeing to the seller of the Ship repayment
of the full amount of the deferred consideration for
the sale of the Ship.
The Borrower and Stena AB shall procure that without the
consent of the Banks no Ship is sold on Credit Terms for a
consideration the principal or capital amount of which is less
than the Fair Market Value of the Ship at the time the Ship is
sold.
5.4 Amounts payable on prepayment
Any prepayment under this Agreement shall be made together with:-
(A) accrued interest on the amount to be prepaid to the date of
such prepayment (calculated in respect of the period during
which the relevant Substitute Basis has applied by virtue of
Clause 4.5, at a rate per annum equal to the aggregate of (i)
the Margin and (ii) for such period the cost to such Bank of
funding its Contribution);
(B) any additional amounts payable under Clauses 7.7 and 17.2;
(C) costs certified by the Agent as necessary to compensate the
Banks for the cost of repaying fixed deposits borrowed to fund
any part of any Advance which is prepaid before the Maturity
Date of any Advance or the fixed term by reference to which
the relevant rate of interest has been ascertained;
(D) all other sums payable by the Borrower to the relevant Bank
under this Agreement or any of the other Security Documents
including, without limitation, any accrued commitment
commission payable under Clause 6.2 and any amounts payable
under Clause 17.
5.5 Notice of prepayment
No voluntary prepayment of an Advance may be effected under this Clause
5 unless the Borrower shall have given the Agent at least three (3)
Banking Days' notice of its intention to make such prepayment, except
on the sale of a Ship or a Total Loss. Every notice of prepayment shall
be effective only on actual receipt by the Agent, shall be irrevocable,
shall specify the amount to be prepaid and shall oblige the Borrower to
make such prepayment on the date specified. Unless and to the extent
that the Commitments are cancelled or reduced on or with effect from
the date of any
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such prepayment, amounts prepaid may be re-drawn under this Agreement.
The Borrower may not prepay any Advance or any part thereof save as
expressly provided in this Agreement.
5.6 Change of control of Stena AB: mandatory cancellation
If at any time during the Security Period less than seventy five per
cent (75%) of the issued voting share capital of Stena AB (including
any votes attached to any shares of Stena AB into which outstanding
warrants or other securities may be converted) is held by members of
the ▇▇▇▇ ▇. ▇▇▇▇▇▇ Family the Borrower or the Agent shall immediately
upon becoming aware thereof give notice to the other. The Agent shall
consult with the Banks as to the appropriate action to be taken in the
light of representations by the Borrower as to the consequences of the
change of shareholding. Without prejudice to Clause 15, not earlier
than one hundred and twenty (120) days after receiving from or giving
notice to the Borrower as provided above the Agent shall unless all of
the Banks agree otherwise if the shareholding of the ▇▇▇▇ ▇. ▇▇▇▇▇▇
Family in Stena AB does not then exceed seventy five per cent (75%),
give notice to the Borrower requiring the Borrower to prepay all the
Advances within thirty (30) days of the Agent's notice and upon such
notice the Borrower shall within such period make payment to the Agent
accordingly and the Commitments shall be cancelled at the end of such
thirty (30) day period.
5.7 Change of control of the Borrower: mandatory cancellation
If at any time during the Security Period Stena AB ceases directly or
via a Wholly Owned Subsidiary of Stena AB to hold the entire issued
share capital of the Borrower without the prior consent of the Majority
Banks the Advances shall forthwith become repayable on the Agent's
demand and the Agent may, and if so directed by the Majority Banks
shall, make such a demand on the Borrower whereupon the Advances shall
be repayable on the date specified in such notice together with all
interest and any commitment commission accrued and all other sums
payable under this Agreement and the Commitments shall be cancelled in
full.
5.8 Voluntary cancellation of Commitments
The Borrower may at any time during the Availability Period by notice
to the Agent (effective only on actual receipt) cancel with effect from
a date not less than thirty (30) days after the receipt by the Agent of
such notice the whole or any part (being $10,000,000 or any larger sum
which is an integral multiple of $10,000,000 but not more than the
Available Commitments of all of the Banks as at such date) of the total
of the Available Commitments as at such date of all the Banks. Any such
notice of cancellation, once given, shall be irrevocable and upon such
cancellation taking effect the Commitment of each of the Banks shall be
reduced proportionately and the Borrower shall on the date designated
in its notice prepay such amount of the outstanding Advances as will
ensure that immediately thereafter the aggregate amount of the Advances
will not exceed the Commitments as so reduced by virtue of the
Borrower's cancellation.
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5.9 Additional partial cancellation
The Borrower may also at any time during the Availability Period by
notice to the Agent (effective only on actual receipt) cancel with
effect from a date not less than thirty (30) Banking Days after receipt
by the Agent of such notice the whole but not part only, but without
prejudice to its obligations under Clauses 7.7 and 17.2, of the
Commitment of any Bank to which the Borrower shall have become obliged
to pay additional amounts under Clause 7.7 or 17.2. Upon any notice of
such prepayment being given, the Commitment of the relevant Bank shall
be reduced to zero and the Borrower shall be obliged to prepay the
Contribution of such Bank on such date.
5.10 Prepayment during Term
The Borrower may at any time by notice to the Agent (effective only on
actual receipt) prepay the whole or any part (being $5,000,000 or any
larger sum which is an integral multiple of $1,000,000) of any Advance
prior to its Maturity Date on not less than three (3) Banking Days
notice (whether or not any part of the Commitment is also being
cancelled on such date pursuant to any provision of this Agreement) and
the Borrower shall when making such prepayment, make such prepayment
together with any amounts as referred to in Clause 5.4.
5.11 Transferred Ships : Application of moneys received
The Borrower shall procure that moneys payable by the purchasers of
Transferred Ships on account of the deferred consideration for the
purchase of the relevant Ships shall be paid to accounts in the name of
the Security Agent established with itself. The amounts accumulated in
such accounts shall be applied on each Disposal Reduction Date in
payment to the Agent of the Disposal Reduction Amount in respect of the
relevant Ship and, provided that no Event of Default has occurred and
is continuing, the balance standing to the credit of the relevant
accounts shall be released to the relevant seller immediately following
such application. Moneys credited to the relevant accounts will bear
interest at the normal rates paid by the Agent for accounts of the
relevant type to first class customers.
6. FEES, COMMISSION, MARGIN AND EXPENSES
6.1 Agency fee
The Borrower shall pay to the Agent and Security Agent on the date
hereof and on each anniversary thereof during the Security Period an
agency fee of the amount set out in a separate letter agreement dated
21 September 2001 made between Svenska Handelsbanken AB (publ), the
Borrower and Stena AB.
6.2 Commitment commission
The Borrower shall pay to the Agent for the account of the Banks
quarterly in arrears during the Availability Period commitment
commission computed from the date of this Agreement at an annual rate
equal to zero point five per cent (0.5%) on the daily average undrawn
and uncancelled amount of each Bank's Available Commitment in relation
to the relevant period. Commitment commission shall also be payable in
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respect of any portion of the Commitments which has been suspended
pursuant to Clause 5.3 (E) but not cancelled.
The first period in respect of which such commitment commission shall
be calculated will be the period from the date of this Agreement up to
and including 30 September 2001; thereafter the commitment commission
shall be calculated for each of the following consecutive periods of
three (3) months ending on 31 March, 30 June, 30 September and 31
December respectively in each year with a final instalment being
calculated in respect of the period ending on the last day of the
Availability Period.
The amount of commitment commission payable in respect of each such
period shall be calculated by the Agent within five (5) Banking Days of
the end of such period and shall be notified by the Agent to the
Borrower who shall pay such amount to the Agent not later than five (5)
Banking Days after receiving the Agent's notification thereof.
6.3 Arrangement fee
The Borrower shall pay to the Agent for the account of the Co-Arrangers
on the date of this Agreement an arrangement fee of the amount set out
in a separate letter agreement dated of even date herewith made between
the Agent and the Borrower.
6.4 Expenses
The Borrower shall pay to the Agent on a full indemnity basis on demand
all expenses (including external and internal legal, printing and
out-of-pocket expenses) incurred:-
(A) by the Agent and/or the Security Agent and/or the Co-Arrangers
in connection with the negotiation, preparation, primary
syndication, execution and, where relevant, registration of
the Security Documents and of any amendment or extension of or
the granting of any waiver or consent under, any of the
Security Documents (but excluding, for the avoidance of doubt,
any such expense incurred in connection with the transfer,
assignment or sub-participation of any of the rights and/or
obligations of any Bank under the Security Documents other
than by the Co-Arrangers in connection with the primary
syndication of the facility granted hereunder); and
(B) by the Agent, the Security Agent and any of the Banks in
contemplation of, or otherwise in connection with, the
enforcement of, or preservation of any rights under, any of
the Security Documents, or otherwise in respect of the moneys
owing under any of the Security Documents together with
interest at the rate referred to in Clause 4.2 from the date
on which such expenses were incurred, to the date of payment
(as well after as before judgment)
provided that the Borrower shall not be liable to reimburse the costs
of any external legal advisers under paragraph (A) except the legal
fees and disbursements of Messrs ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & Temperley as counsel
to the Co-Arrangers and the fees and disbursements of the legal counsel
who are to render opinions in respect of any of the Security Documents
or to deal with registration of any of the Ship Mortgages or other
Security Documents on behalf of the Security Agent.
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6.5 Value added tax
All fees, commissions and expenses payable pursuant to this Clause 6
shall be paid together with an amount equal to any value added tax
payable by the Agent, the Security Agent, the Co-Arranger or any Bank
in respect of such fees and expenses and any value added tax chargeable
in respect of any services supplied by the Agent, the Security Agent,
the Co-Arrangers or any Bank under this Agreement shall, on delivery of
a value added tax invoice, be paid in addition to any sum agreed to be
paid hereunder to the extent that, in either case, the Agent, the
Security Agent, the Co-Arrangers or the relevant Bank (as the case may
be) shall have certified (such certificate to be binding and
conclusive, in the absence of manifest error, on the Borrower) to the
Borrower that it is not entitled to credit for such value added tax as
input tax.
6.6 Stamp and other duties
The Borrower shall pay all stamp, documentary, registration or other
like duties or taxes (including any duties or taxes payable by the
Agent, the Security Agent, the Co-Arrangers and the Banks but excluding
any such duties or taxes incurred in connection with any transfer,
assignment or sub-participation of any of the rights and/or obligations
of a Bank under any of the Security Documents) imposed on or in
connection with any of the Commercial Documents or the Security
Documents and shall indemnify the Agent, the Co-Arrangers, the Security
Agent and the Banks against any liability arising by reason of any
delay or omission by the Borrower to pay such duties or taxes.
6.7 Supplemental Margin
(A) The Margin is calculated on the basis that the daily average
of the Advances of each Bank during each Calculation Period
will not exceed thirty three and one-third of one per cent (33
1/3%) of the daily average of the Commitment of that Bank
during such Calculation Period. If such daily average for a
Calculation Period exceeds thirty three and one-third of one
per cent (33 1/3%) and sixty six and two-thirds of one per
cent (66 2/3%) (as the case may be) an additional amount shall
be payable by the Borrower to each Bank in the manner provided
by this Clause 6.7.
(B) For the purposes of this Clause 6.7:-
(i) "CALCULATION PERIOD" means the period commencing on
the Availability Date and ending on the first Review
Date and each of the successive three (3) monthly
periods thereafter each expiring on a Review Date
with the final Calculation Period (whether of three
(3) months or shorter) ending on the final Review
Date; and
(ii) "REVIEW DATE" means 30 September 2001 and 31 March,
30 June and 30 September and 31 December in each year
thereafter up to the date upon which all of the
Commitments are reduced to zero, and such date
itself.
(C) Within five (5) Banking Days after each Review Date the Agent
shall
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calculate the actual daily average of the Advances of each
Bank during the Calculation Period expiring on such Review
Date according to the following formula -
A = O x 100
-
C
where -
A is the actual daily average of the Advances of the relevant
Bank during the relevant Calculation Period, expressed as a
percentage.
O is the aggregate of the amounts of such Bank's Advances on
each day during such Calculation Period; and
C is the aggregate of the amounts of the Commitment of such
Bank on each day during such Calculation Period.
(D) For the purposes of this Clause 6.7, the rate of supplemental
margin in relation to a Calculation Period will be as
follows:-
(i) where A as so calculated exceeds thirty three and
one-third of one per cent (33 1/3%) but does not
exceed sixty six and two-thirds of one per cent (66
2/3%), the supplemental margin for such part of such
Calculation Period will be zero point twenty five per
cent (0.25%); and
(ii) where A as so calculated exceeds sixty six and
two-thirds of one per cent (66 2/3%), the
supplemental margin for such part of such Calculation
Period will be zero point three hundred and seventy
five per cent (0.375%).
(E) Upon calculating the rate of supplemental margin (if any), the
Agent shall promptly calculate an amount (the "Supplemental
Margin Amount") equal to interest accruing at an annual
percentage rate equal to the supplemental margin for such
Calculation Period on the daily Advances of each Bank from the
beginning of such Calculation Period to the Review Date on
which it ends. The Agent shall then notify the Borrower and
each Bank of the rate of supplemental margin (if any) for such
Calculation Period and the Supplemental Margin Amount (if any)
due to such Bank for such Calculation Period.
(F) The Borrower shall pay to the Agent, for the account of the
Banks, the aggregate of the Supplemental Margin Amounts due to
each of the Banks for a Calculation Period within five (5)
Banking Days of being notified by the Agent of the rate of
supplemental margin and the amount of the Supplemental Margin
Amounts for that Calculation Period.
7. PAYMENTS AND TAXES; ACCOUNTS AND CALCULATIONS
7.1 No set-off or counterclaim; distribution to the Banks
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The Borrower acknowledges that in performing their obligations under
this Agreement, the Banks will be incurring liabilities to third
parties in relation to the funding of amounts to the Borrower, such
liabilities matching the liabilities of the Borrower to the Banks and
that it is reasonable for the Banks to be entitled to receive payments
from the Borrower gross on the due date in order that the Banks are put
in a position to perform their matching obligations to the relevant
third parties. Accordingly all payments to be made by the Borrower
under any of the Security Documents shall be made in full, without any
set-off or counterclaim whatsoever and, subject as provided in Clause
7.7, free and clear of any deductions or withholdings, in Dollars
(except for costs, charges or expenses which shall, at the request of
the Agent, be payable in the currency in which they are incurred) on
the due date to the account required under Clause 7.12. Save where this
Agreement specifically provides for a payment to be made for the
account of a particular Bank (including, without limitation, Clauses 6,
7.7, 16.2, 17.1, 17.2 and 18.2) in which case the Agent shall
distribute the relevant payment to the Bank concerned, payments to be
made by the Borrower under this Agreement shall be for the account of
all the Banks and the Agent shall forthwith distribute such payments in
like funds as are received by the Agent to the Banks rateably in
accordance with their Commitments.
7.2 Payments by the Banks
(A) To the Agent
All payments to be made by a Bank to or for the account of the
Agent under this Agreement shall be made in full, without any
set-off or counterclaim whatsoever and, subject as provided in
Clause 7.8, free and clear of any deductions or withholdings,
in Dollars on the due date to the account of the Agent at such
bank as the Agent may from time to time specify for this
purpose.
(B) To the Borrower
All sums to be advanced by the Banks to the Borrower under
this Agreement shall be remitted in Dollars on the date of the
Advance to the account of the Agent at such bank as the Agent
may have notified to the Banks and shall be paid by the Agent
on such date in like funds as are received by the Agent to the
account specified in the relevant Drawdown Notice.
7.3 Agent may assume receipt
Where any sum is to be paid under any of the Security Documents to the
Agent for the account of another person, the Agent may assume that the
payment will be made when due and the Agent 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 person 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 and the person by whom such sum was payable
shall indemnify the Agent and/or person to whom such sum was made
available by the Agent for any and all loss or expense which the Agent
or such person may sustain or incur as a consequence of such sum not
having been paid on its due date.
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7.4 Non-Banking Days
When any payment under any of the Security Documents would otherwise be
due, or the Termination Date would otherwise fall, on a day which is
not a Banking Day, the due date for payment or (as the case may be) the
Termination Date 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, or (as the case may be) the Termination Date
shall fall, on the immediately preceding Banking Day.
7.5 Calculations
All interest, commissions, fees and other payments of an annual nature
under any of the Security Documents shall accrue from day to day and be
calculated on the basis of actual days elapsed and a 360 day year.
7.6 Certificates conclusive
Any certificate or determination of the Agent or any Bank as to any
rate of interest or any other amount pursuant to and for the purposes
of any of the Security Documents shall substantiate in reasonably
sufficient detail the interest or other amount concerned and, subject
thereto, shall, in the absence of manifest error, be conclusive and
binding on the Borrower and (in the case of a certificate or
determination by the Agent) on the Banks. The Agent shall, promptly
upon the request of the Borrower, send to the Borrower such details as
may reasonably be required by the Borrower setting out the manner in
which any such rate or amount has been determined, together with such
documents and calculations as may reasonably be required by the
Borrower in order to verify the same.
7.7 Grossing-up for Taxes - Borrower
(A) Grossing up
If at any time the Borrower or Stena AB is required to make
any deduction or withholding in respect of Taxes from any
payment due under any of the Security Documents for the
account of any Bank, the Co-Arrangers, the Security Agent or
the Agent (or if the Agent is required to make any deduction
or withholding from a payment to the Co-Arrangers, the
Security Agent or a Bank), the sum due from the Borrower or,
as the case may be, Stena AB in respect of such payment shall
be increased to the extent necessary to ensure that, after the
making of such deduction or withholding, each Bank, each
Co-Arranger, the Security Agent, and the Agent receives 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 it would have received had no such
deduction or withholding been required to be made and the
Borrower and Stena AB shall indemnify each Bank, the
Co-Arrangers, the Security Agent and the Agent against any
losses or costs incurred by any of them by reason of any
failure of the Borrower or Stena AB 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 or, as the
case may be, Stena AB shall promptly deliver to the Agent any
receipts, certificates or other proof
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evidencing the amounts (if any) paid or payable in respect
of any deduction or withholding as aforesaid.
(B) Tax credits
If, following any such deduction or withholding as is referred
to in Clause 7.7(A) from any payment by the Borrower or Stena
AB, the recipient of that payment shall receive or be granted
a credit against or remission for any Taxes payable by it,
such recipient shall, subject to the Borrower or, as the case
may be, Stena AB having made any increased payment in
accordance with Clause 7.7(A) and to the extent that the
recipient can do so without prejudicing the retention of the
amount of such credit or remission and without prejudice to
the right of the recipient to obtain any other relief or
allowance which may be available to it, reimburse the Borrower
or, as the case may be, Stena AB with such amount as the
recipient shall in its absolute discretion certify to be the
proportion of such credit or remission as will leave the
recipient (after such reimbursement) in no worse position than
it would have been in had there been no such deduction or
withholding from the payment by the recipient as aforesaid.
Such reimbursement shall be made forthwith upon the Bank
certifying that the amount of such credit or remission has
been received by it. Nothing contained in this Agreement shall
oblige the recipient to rearrange its tax affairs or to
disclose any information regarding its tax affairs and
computations. Without prejudice to the generality of the
foregoing, neither the Borrower nor Stena AB shall by virtue
of this Clause 7.7(B) be entitled to enquire about the
recipient's tax affairs.
7.8 Grossing-up for Taxes - Banks
If at any time any Bank is required to make any deduction or
withholding in respect of Taxes from any payment due under any of the
Security Documents for the account of the Agent or the Security Agent
the sum due from such Bank 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 the Security Agent 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 each Bank shall indemnify the Agent and
the Security Agent against any losses or costs incurred by any of them
by reason of any failure of such Bank to make any such deduction or
withholding or by reason of any increased payment not being made on the
due date for such payment.
7.9 Bank accounts
Each Bank 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 the Security Documents. The Agent shall
maintain a control account showing the Advances and other sums owing to
the Agent, the Security Agent and the Banks under the Security
Documents and all payments in respect thereof made from time to time.
The control account shall, in the absence of manifest error, be
conclusive as to the amount from time to time owing to the Agent, the
Security Agent and the Banks under the Security Documents.
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7.10 Application of moneys
All moneys received by the Agent, the Security Agent or any Bank under
or pursuant to this Agreement or any other of the Security Documents
and expressed to be applicable in accordance with this Clause 7.10 or
whose application is not otherwise specifically provided for in the
Security Documents shall (if not already done so) be paid to the Agent
and shall be applied by the Agent:-
FIRST: in or towards satisfaction pari passu of any amounts in
respect of the balance of the Outstanding Indebtedness as
are then accrued due and payable or are then due and payable
by virtue of payment demanded;
SECONDLY: the surplus (if any) shall be paid to the Borrower or
whomsoever else shall be entitled thereto.
7.11 Suspense account
Notwithstanding the provisions of Clause 7.10, insofar as any moneys
are received or recovered by the Security Agent under or in connection
with the guarantee and indemnity contained in Clause 8, such moneys may
at the Security Agent's discretion be transferred to a suspense or
impersonal account and may be held in such account for so long as the
Security Agent thinks fit pending payment to the Agent for application
in or towards discharging the obligations of the Borrower under this
Agreement and the other Security Documents.
7.12 Place of payment
All payments to be made by the Borrower or Stena AB under any of the
Security Documents shall be made not later than 10.00 a.m. New York
time on the due date and in same day funds to the account of the Agent
at The Chase Manhattan Bank New York City, USA by way of payment order
MT100 SWIFT Address ▇▇▇▇▇▇▇▇ or tested telex no. 27500 answerback
HANDGBS quoting reference RVIC STBNL 647 or at such other office or
bank in New York City as the Agent may from time to time designate.
8. GUARANTEE AND INDEMNITY
8.1 Guarantee
In consideration of the Banks agreeing at the request of Stena AB to
make available to the Borrower the loan facility provided for in this
Agreement in accordance with the terms of this Agreement and in order
to secure the payment of the Outstanding Indebtedness in accordance
with the provisions of the Security Documents and the performance and
observance of all of the obligations contained in the Security
Documents:-
(A) Stena AB as primary obligor as and for its own debt and not
merely as surety hereby undertakes to the Security Agent as
trustee for and on behalf of itself, the Banks, the
Co-Arrangers and the Agent to be responsible for and hereby
guarantees to the Security Agent the due and punctual payment
by the Borrower to the Agent on behalf of the Banks, the
Co-Arrangers, the Security
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Agent and the Agent (as and when due by acceleration, demand
or otherwise howsoever) of the Outstanding Indebtedness and
every part thereof;
(B) Stena AB unconditionally undertakes immediately on demand by
the Security Agent from time to time to pay and/or perform its
obligations under Clause 8.1(A); and
(C) Stena AB unconditionally undertakes immediately on demand by
the Agent from time to time to indemnify and hold harmless the
Security Agent, the Banks, the Co-Arrangers and the Agent in
respect of:-
(i) any loss incurred by the Security Agent, the Banks,
the Co-Arrangers and/or the Agent as a result of any
of the Security Documents or any provision thereof
being or becoming invalid, void, voidable or
unenforceable for any reason whatsoever; and
(ii) all loss or damage of any kind arising directly or
indirectly from any failure on the part of the
Borrower to perform any obligation to be performed by
the Borrower under and pursuant to the Security
Documents or any of them.
The obligations of Stena AB under this Clause 8 shall not be diminished
by any of the other obligations undertaken by Stena AB in this
Agreement and the obligations of Stena AB set out in Clause 8.1(A)
shall be construed as a guarantee of payment and not of collection.
8.2 Survival of Stena AB's liability
Stena AB's liability to the Security Agent and the Banks, the
Co-Arrangers and the Agent under Clause 8.1 shall not be discharged,
impaired or otherwise affected by reason of any of the following events
or circumstances (regardless of whether any such events or
circumstances occur with or without the knowledge or consent of Stena
AB):-
(A) any time, forbearance or other indulgence given or agreed by
the Security Agent, the Banks, the Co-Arrangers and/or the
Agent to or with any Security Party in respect of any of its
respective obligations to the Security Agent, the Banks, the
Co-Arrangers and/or the Agent hereunder or under any other of
the Security Documents; or
(B) any legal limitation, disability or incapacity relating to any
Security Party; or
(C) any invalidity, irregularity, unenforceability, imperfection
or avoidance of or any defect in any security granted by, or
the obligations of any Security Party under, this Agreement or
any other of the Security Documents or any amendment to or
variation thereof or to or of any other document or security
comprised therein; or
(D) any change in the name, constitution or otherwise of any
Security Party or the merger of any Security Party with any
other corporate entity; or
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(E) the liquidation, bankruptcy or dissolution (or proceedings
analogous thereto) of any Security Party or the appointment of
a receiver or administrative receiver or administrator or
trustee or similar officer of any of the assets of any
Security Party or the occurrence of any circumstances
whatsoever affecting any Security Party's liability to
discharge its respective obligations under any of the Security
Documents; or
(F) any challenge, dispute or avoidance by any liquidator of any
Security Party in respect of any claim by Stena AB or the
Borrower or any of them by right of subrogation in any such
liquidation; or
(G) any release of any other Security Party or any renewal,
exchange or realisation of any security or obligation provided
under or by virtue of any of the Security Documents or the
provision to the Security Agent, the Banks, the Co-Arrangers
and/or the Agent at any time of any further security for the
obligations of the Borrower under any of the Security
Documents; or
(H) the release of any co-guarantor and/or indemnor who is now or
may hereafter become under a joint and several liability with
Stena AB under this guarantee or the release of any other
guarantor, indemnor or other third party obligor in respect of
the obligations of any Security Party under any of the
Security Documents; or
(I) any failure on the part of the Security Agent, the Banks, the
Co-Arrangers and/or the Agent (whether intentional or not) to
take or perfect any security agreed to be taken under or in
relation to any of the Security Documents or to enforce any of
the Security Documents; or
(J) any other act, matter or thing (save for repayment in full of
the Outstanding Indebtedness) which might otherwise constitute
a legal or equitable discharge of any of Stena AB's
obligations under this Clause 8.
8.3 Continuing guarantee
The guarantee contained in Clause 8.1 shall be:
(A) a continuing guarantee remaining in full force and effect
until payment in full has been received by the Security Agent,
the Banks, the Co-Arrangers and the Agent of each and every
part and the ultimate balance of the Outstanding Indebtedness
in whatever currency or currencies the same may from time to
time be denominated in accordance with this Agreement; and
(B) in addition to and not in substitution for or in derogation of
any other security held by the Security Agent, the Banks, the
Co-Arrangers and/or the Agent from time to time in respect of
the Outstanding Indebtedness or any part thereof.
8.4 Circumstances where discharge to be void ab initio
--------------------------------------------------
Any satisfaction of obligations by Stena AB to the Security Agent, the
Banks, the Co-Arrangers and/or the Agent or any discharge given by the
Security Agent, the Banks, the Co-Arrangers and/or the Agent to Stena
AB or any other agreement reached by
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Stena AB with the Security Agent, the Banks, the Co-Arrangers and/or
the Agent in relation to this Clause 8 shall be, and be deemed always
to have been, void ab initio if any act satisfying any of the said
obligations or on the faith of which any such discharge was given or
any such agreement was entered into is subsequently avoided in whole
or in part by or pursuant to any provision of any applicable law
whatsoever.
8.5 Exclusion of the rights of Stena AB as guarantor
Until the actual and contingent obligations of each Security Party
under the Security Documents have been performed in full Stena AB shall
not:-
(A) be entitled to share in or succeed to or benefit from (by
subrogation or otherwise) any rights which the Security Agent,
the Banks, the Co-Arrangers and/or the Agent may have in
respect of the Outstanding Indebtedness or any security
therefor or all or any of the proceeds of such rights or
security; or
(B) without the prior consent of the Security Agent (as directed
by the Banks):-
(i) exercise in respect of any amount paid by it hereunder
any right of subrogation, contribution or any other
right or remedy which it may have in respect thereof;
or
(ii) prove in a liquidation of any Security Party in
competition with the Security Agent or the Agent, the
Co-Arrangers or any of the Banks for any moneys owing
to Stena AB by any other Security Party on any account
whatsoever.
9. REPRESENTATIONS AND WARRANTIES
9.1 Continuing
The Borrower and Stena AB each represent and warrant (subject to the
reservations or qualifications as to matters of law as set forth in the
Legal Opinions delivered to the Agent) to the Agent, the Security
Agent, the Co-Arrangers and the Banks that as at the date hereof (and
each other date referred to in Clause 9.3):-
(A) Status
each of the Security Parties is a limited liability company,
duly constituted and validly existing under the laws of its
place of incorporation, possessing perpetual corporate
existence, the capacity to ▇▇▇ and be sued in its own name and
the power to own its assets and carry on its business as it is
now being conducted;
(B) Powers and authority
each of the Security Parties has the power and capacity to
enter into, and to perform its obligations under, those of the
Security Documents to which it is or will be a party and has
taken all necessary action to authorise the entry into such
Security Documents and the performance by it of its
obligations thereunder;
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(C) Legal validity
this Agreement constitutes and each other of the Security
Documents, upon execution and delivery thereof, will
constitute (subject to any Post-Completion Registrations) the
legal, valid and binding obligations of each Security Party
which is a party thereto enforceable in accordance with its
terms except as such enforcement may be limited by any
relevant bankruptcy, insolvency, administration or similar
laws affecting creditors' rights generally and by general
principles of equity and subject to any relevant
qualifications contained in any of the Legal Opinions
delivered to the Agent;
(D) Non-conflict with laws
the entry into and performance of the Security Documents to
which each Security Party is or will be a party and the
transactions contemplated hereby and thereby do not and will
not contravene or conflict with:-
(i) any law or regulation or any official or judicial
order; or
(ii) the constitutional documents of such Security Party; or
(iii) any material agreement or document to which such
Security Party is a party or which is binding upon it
or any of its assets;
nor, save as contemplated by this Agreement and the other
Security Documents, result in the creation or imposition of
any Lien on the assets of any Security Parties pursuant to the
provisions of any such agreement or document;
(E) Pari passu status
the claims of the Banks, the Co-Arrangers, the Agent and the
Security Agent against each Security Party under the Security
Documents will (subject to the terms of the relevant Security
Documents) rank at least pari passu with the claims of all
other unsecured creditors of such Security Party other than
claims of such creditors to the extent that they are
statutorily preferred;
(F) No immunity
no Security Party nor any of its respective assets enjoys any
right of immunity from set-off, suit or execution in respect
of its obligations under this Agreement or any other of the
Security Documents to which it is a party;
(G) Executive office
none of the Security Parties has an executive office in any
part of the U.S.A. which would entitle it to apply for a
reorganisation under Chapter XI of the United States
Bankruptcy Act;
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(H) No money laundering
in relation to the utilisation by the Borrower of the
facilities granted to it hereunder, the performance and
discharge of its obligations and liabilities under the
Security Documents to which it is a party, and the
transactions and other arrangements effected or contemplated
by the Security Documents to which the Borrower is a party,
the Borrower confirms that it is acting for its own account
and that the foregoing will not involve or lead to
contravention of any law, official requirement or other
regulatory measure or procedure implemented to combat "money
laundering" (as defined in Article 1 of the Directive
(91/308/EEC) of the Council of the European Communities).
9.2 Initial
The Borrower and Stena AB each represent and warrant (subject to the
reservations or qualifications as to matters of law as set forth in the
Legal Opinions delivered to the Agent) to the Agent, the Security
Agent, the Co-Arrangers and the Banks that as at the date hereof:-
(A) No default
no event has occurred which constitutes a material default
under or in respect of:-
(i) any agreement or document relating to Debt to which any
Security Party is a party or by which any Security
Party may be bound; or
(ii) any other agreement or document to which any Security
Party is a party or by which any Security Party may be
bound and which default will have, or may reasonably be
expected to have, a material adverse effect on the
ability of such Security Party to perform its
respective obligations under this Agreement and the
other Security Documents;
(B) Consents
save as disclosed in writing to the Agent or as disclosed in
any of the documents or evidence referred to in Schedule 5
delivered to, and accepted by, the Agent under this Agreement,
all authorisations, approvals, consents, licences, exemptions,
filings, registrations, notarisations and other matters,
official or otherwise, required by any Security Party:-
(i) in connection with the entry into, performance,
validity and enforceability of this Agreement and the
other Security Documents and the transactions
contemplated hereby and thereby;
(ii) in order to maintain its corporate existence in good
standing; and
(iii) in order to ensure that it has the right, and is duly
qualified and able, to conduct its business as it is
conducted in all applicable jurisdictions including,
without limitation to the generality of the foregoing,
all such consents and approvals as are required to
conduct its business and/or own and operate its assets
- 74 -
have been obtained or effected and are in full force
and effect other than
(a) Post-Completion Registrations in respect of
paragraph (i) above; and
(b) any consent or approval required by a Security
Party to conduct its business and/or own and
operate its assets to the extent that such
Security Party is unaware or cannot reasonably
be expected to be aware of the requirement to
obtain such consent or approval or to the
extent that the absence of such consent or
approval would not have a material adverse
effect on the ability of such Security Party
to perform its obligations under the Security
Documents;
(C) Accuracy of information
all factual information furnished in writing to the
Co-Arrangers by the Borrower and Stena AB relating to the
businesses and affairs of the Stena AB Group in connection
with this Agreement, the other Security Documents and the
Commercial Documents was (when given) true and correct in all
material respects and there are no other material facts or
considerations the omission of which would render any such
information misleading;
(D) Accounts
the Audited Stena AB Financial Statements for the financial
year ended 31 December 2000 (which accounts were prepared in
accordance with Swedish GAAP) fairly represent the
consolidated financial condition of the Stena AB Group as at
31 December 2000 and since that date there has been no
material adverse change in the consolidated financial
condition of the Stena AB Group as shown in such audited
accounts save as disclosed in writing to the Agent;
(E) No Liens
none of the Unencumbered Assets is subject to any Liens other
than in favour of Svenska Handelsbanken AB (publ) (in the case
of the P&O Stena Shares and the P&O Stena Loan Stock) as
security for the Stena Line Revolving Credit Facility;
(F) Existing Debt
neither Stena AB nor any of its Subsidiaries (other than
Unrestricted Subsidiaries) has incurred any Debt other than:
(i) in respect of Existing Debt; or
(ii) the Notes (to the extent not included in the definition
Existing Debt);
(iii) pursuant to this Agreement;
(iv) pursuant to the Stena Discovery Facility Agreement;
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(v) pursuant to the Unsecured Revolving Credit Facility
Agreement;
(vi) pursuant to the ABN Standby Facility Agreement;
(G) Winding-up, etc.
no Security Party has taken any corporate action nor have any
other steps been taken or legal proceedings been started or
(to the best of the knowledge and belief of the Borrower and
Stena AB) threatened against any of Stena AB or any other
Security Party for its winding-up or dissolution or for the
appointment of a liquidator, administrator, receiver,
administrative receiver, trustee or similar officer of any
Security Party of any or all of its assets or revenues nor has
any Security Party sought any other relief under any
applicable insolvency or bankruptcy law;
(H) Litigation
save as disclosed in writing to the Agent, no litigation,
arbitration or administrative proceedings are current or
pending or, to the knowledge of the Borrower and/or Stena AB,
threatened, which involve a claim against any Security Party
in an amount exceeding $2,000,000;
(I) Taxes on payments
all amounts payable by each Security Party under the Security
Documents may be made free and clear of and without deduction
for or on account of any Taxes;
(J) Completeness of documents
the copies of the Commercial Documents delivered to the Agent
are true and complete copies of each such document and no
amendments thereto or variations thereof have been made or
agreed which are substantial in relation to the business as
presently conducted of the Stena AB Group as a whole.
9.3 Repetition of continuing representations and warranties
On and as of the Availability Date, each date of drawing an Advance and
each Maturity Date the Borrower and Stena AB shall be deemed to repeat
the representations and warranties in Clause 9.1 as if made with
reference to the facts and circumstances existing on such day.
9.4 Future financial statements
In relation to the financial statements provided or to be provided
under Clause 10, the Borrower and Stena AB each represent and warrant,
as at the date to which such statements were prepared, that the
statements were prepared in accordance with Swedish GAAP (in the case
of Stena AB) or Dutch GAAP (in the case of the Borrower) and fairly
represent the consolidated financial position of (as the case may be)
the Stena AB Group or the Stena International Group as at such date.
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10. UNDERTAKINGS
10.1 Duration
The undertakings contained in this Clause 10 shall remain in force from
the date of this Agreement until the end of the Security Period.
10.2 Provision of financial and other information
The Borrower will provide to the Agent in sufficient copies for
distribution to each of the Banks:-
(A) within one hundred and eighty (180) days after the close of
the relevant financial years, copies of the Audited Stena AB
Financial Statements and of the Audited Stena International
Financial Statements for that financial year;
(B) as soon as practicable, but in any event within ninety (90)
days after 30 September 2001 and each of the dates falling
quarterly thereafter (other than the final quarter of each
financial year), certified copies of the unaudited
consolidated management accounts of the Stena AB Group and of
the Stena International Group for the preceding quarter;
(C) promptly, such further information in the possession or
control of the Borrower or Stena AB regarding the financial
condition and operations of the Stena AB Group and/or the
Stena International Group as the Agent may reasonably request;
(D) within ninety (90) days after the end of each financial year
of Stena AB, an Officer's Certificate (one of the signors of
which is the principal executive, financial or accounting
officer of Stena AB), stating whether or not to the best
knowledge of the signors thereof, Stena AB is in default in
the performance and observance of any of the terms, provisions
and conditions of Clauses 10.6, 10.7, 10.8, 10.9, 10.10,
10.11, 10.14, 10.17, 10.20 and 10.21 and, if Stena AB shall be
in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge;
(E) as soon as practicable, but in any event within one hundred
and twenty (120) days after the close of each financial year:-
(i) a certificate from the chief financial officer of each
Port Owner certifying the amount of earnings before
interest, taxes, depreciation and amortisation during
the previous twelve (12) month period of each Mortgaged
Port owned by the Port Owner; and
(ii) copies of the unaudited management accounts of each
Port Owner for such financial year showing the earnings
before interest, taxes, depreciation and amortisation
of each such Port
such documents to be in a form reasonably acceptable to the
Agent so that, if they are not so acceptable, the Borrower
shall, if requested by the Agent, procure that an auditor's
certificate and/or audited accounts are delivered to the
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Agent showing the earnings before interest, taxes,
depreciation and amortisation of each Mortgaged Port as
referred to in paragraph (i) above, and
(F) not later than 28 September 2001 in respect of the position as
at 30 June 2001 and thereafter within ninety (90) days after
31 December 2001 and each of the dates falling at six (6)
monthly intervals thereafter or, if the Agent so requests in
writing pursuant to Clause 10.21(B), within ninety (90) days
after the end of any other relevant financial quarter (or (if
later) within ten (10) business days in Gothenburg (excluding
public holidays, Saturdays and Sundays) of receipt of the
Agent's written request), an Officer's Certificate together
with the method of the calculation of the asset coverage ratio
and all supporting documents, in substantially the form set
out in Schedule 21 in respect of the asset coverage ratio set
out in Clause 10.21(A) confirming:-
(i) the respective amounts of the Appraised Value of
Restricted Group Assets, Secured Debt, Strategic
Investments, Cash and Marketable Securities, Net Market
Value of the Unrestricted Group, Other Assets and
Working Capital, Available Asset Value and Unsecured
Debt (as each of those terms is defined in Clause
10.21(C)) as at the relevant date and that such amounts
were calculated in accordance with this Agreement and
Swedish GAAP; and
(ii) the amounts of the valuations of the assets comprised
in the calculation of the Available Asset Value
(including a list of each of the vessels and ports and
their respective valuations).
10.3 Notification of default
The Borrower or Stena AB will notify the Agent of any Default promptly
upon their becoming aware of the occurrence thereof.
10.4 Preparation of financial statements
Each set of financial statements and management accounts to be provided
to the Agent pursuant to Clause 10.2 shall be prepared in accordance
with Swedish GAAP (in the case of the Stena AB Group) or Dutch GAAP (in
the case of the Stena International Group) consistently applied (or, if
not consistently applied, accompanied by details of the
inconsistencies) and shall fairly represent the financial condition of
Stena AB Group and the Stena International Group respectively.
10.5 Consents and registrations and maintenance of status
Each of the Borrower and Stena AB will do, and will procure that each
other Security Party will do, all such things as are necessary to
enable it to comply with any of its financial obligations under those
of the Security Documents to which it is a party including, without
limitation, obtaining, maintaining, promptly renewing (when necessary)
and complying at all times with (and promptly furnishing certified
copies to the Agent of) all such authorisations, approvals, consents,
licences and exemptions as are from time to time required under any
applicable law or regulation in connection with any of the matters
aforesaid.
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Insofar as any such filings or registrations aforesaid have not been
completed on or before the first Advance is drawn the Borrower and
Stena AB will procure the filing or registration within applicable time
limits of each Security Document which requires filing or registration
together with all ancillary documents required to preserve the priority
and enforceability of the Security Documents.
Where the operation of any Mortgaged Ship or Mortgaged Linkspan in
accordance with its owner's or operator's requirements requires the
obtaining or maintenance of a route licence or port licence, the
Borrower and Stena AB further undertake to procure that such licence is
obtained, maintained, promptly renewed (when necessary) and complied
with in all material respects at all relevant times during the Security
Period.
10.6 Limitation on Liens
Except with the prior written consent of the Majority Banks, the
Borrower and Stena AB will not, and shall procure that no other member
of the Stena AB Group will:-
(A) create or incur or permit to subsist any Lien (other than a
Permitted Ship Lien) on the whole or any part of any property
or rights which is or are presently or may in future during
the Security Period be subject to any Lien in favour of the
Security Agent pursuant to the Security Documents or over any
Earnings of any Shipowner or Stena Charterer in relation to
any Mortgaged Ship; or
(B) create or incur any Lien (other than Permitted Liens) on or
with respect to any other property or assets of Stena AB or
any Subsidiary thereof now owned or hereafter acquired to
secure Debt of any person without making, or causing such
Subsidiary to make, effective provision for securing the
Outstanding Indebtedness equally and rateably with such Debt
or, in the event such Debt is subordinate in right of
payment to the Outstanding Indebtedness, prior to such Debt,
as to such property or assets for so long as such Debt shall
be so secured provided however that Stena AB and its
Subsidiaries may incur Liens to secure any Debt under this
paragraph (B) without securing the Outstanding Indebtedness
equally and rateably with or prior to such Debt, as
applicable, if the outstanding amount of Debt secured by
Liens created after the date of this Agreement and otherwise
prohibited by this Agreement does not at the time of such
incurrence, when aggregated with the outstanding amount of
Debt secured by Liens created after 1 October 1997 but
before the date of this Agreement otherwise prohibited by
the 2007 Indenture but which Liens are permitted by Section
10.14(b) thereof, exceed:-
(i) 5% of Consolidated Tangible Assets; minus;
(ii) the lesser of (a) the Fair Market Value of the Related
Collateral and/or other property granted as additional
security pursuant to paragraph (O) of the definition of
"Permitted Liens" and subject to Liens at such time and
(b) the maximum amount of Debt secured at such time or
thereafter by such additional collateral set forth in a
written security or other agreement at such time or
thereafter with respect to such additional collateral.
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10.7 Asset Dispositions
(A) Stena AB will not, and will not permit any Subsidiary of Stena
AB to, make any Asset Disposition in one or more related
transactions by Stena AB or a Subsidiary of Stena AB unless:-
(i) Stena AB or the Subsidiary of Stena AB, as the case
may be, receives consideration for such disposition
at least equal to the Fair Market Value for the
shares or assets sold or disposed of as determined by
the Board of Directors of Stena AB or such Subsidiary
in good faith;
(ii) at least eighty five per cent (85%) of the
consideration for such disposition consists of one or
more of the following:-
(w) cash or Cash Equivalents, provided that any
promissory note (or other evidence of
indebtedness) received by Stena AB or such
Subsidiary that is immediately converted
into cash or Cash Equivalents shall be
deemed to be cash for the purposes of this
provision to the extent of the cash or Cash
Equivalents actually received upon such
conversion;
(x) in the case of an Asset Disposition relating
to a Vessel or Vessels, a promissory note
(or other evidence of indebtedness) issued
by the purchaser of the asset sold or
disposed of and secured by a first perfected
security interest in such asset, (provided
such security interest remains in full force
and perfected, or is replaced by a bank
guarantee, letter of credit or cash
collateral, until all obligations arising
under such promissory note (or other
evidence of indebtedness) are paid in full),
a bank guarantee, a letter of credit or cash
collateral;
(y) the assumption of Debt (which, for the
purposes of the calculation of the
consideration received pursuant to the Asset
Disposition, shall be valued at the
principal amount so assumed) of Stena AB or
such Subsidiary or other obligations
relating to such assets and release from all
liability on such Debt or other obligations
assumed;
(z) in the case of an Asset Disposition relating
to a Vessel or Vessels, notes received in
consideration for such disposition,
provided, that at no time shall there be, in
the aggregate, more than $15,000,000 of
notes received under this sub-clause (z)
outstanding (exclusive of notes complying
with the requirements of clauses (w) or (x)
above); and
(iii) no Default or Event of Default (as defined in either
Indenture or any Successor Financing) shall have
occurred and be continuing at the time of, or after
giving effect to, such Asset Disposition.
(B) The Net Available Proceeds of any Asset Disposition shall
subject to Clauses 5.3 and 5.4 be applied by Stena AB or any
Subsidiary of Stena AB (as the case
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may be) within three hundred and sixty (360) days after such
Asset Disposition:-
(i) first, to repay permanently any outstanding Debt of:-
(a) Stena AB that ranks senior to or pari passu with the
Notes or any Successor Financing; or
(b) any Subsidiary of Stena AB that does not constitute
Subordinated Debt,
in each case as required by the terms thereof,
(ii) second, to the extent of any then remaining Net
Available Proceeds and to the extent Stena AB or such
Subsidiary so elects:-
(a) to the prepayment of Debt of:-
(x) Stena AB that ranks senior to or pari passu with
the Notes or any Successor Financing; or
(y) any Subsidiary of Stena AB that does not
constitute Subordinated Debt; and/or
(b) to an investment (which shall be deemed to include
entering into a legally binding agreement, subject
to customary conditions, to invest) in assets, other
than Cash Assets, that will be used in the business
of Stena AB and its Subsidiaries subject to the
limitations of Clause 10.11; provided that Stena AB
or any Subsidiary of Stena AB may deem that the
amount of any prior investment (including, without
limitation, any payments made in respect of Vessel
Construction Contracts) made in connection with the
delivery or acquisition of any Vessel, equal to the
difference between the Ready for Sea Cost of such
Vessel and the aggregate Debt Incurred to finance
the purchase of such Vessel (or related assets)
occurring within one (1) year prior to such Asset
Disposition, shall be considered an investment
made with the Net Available Proceeds of such Asset
Disposition.
If any legally binding agreement to invest any Net
Available Proceeds is terminated, then Stena AB, or
any Subsidiary of Stena AB, may invest such Net
Available Proceeds, prior to the end of the one (1)
year period after such Asset Disposition or six (6)
months from such termination, whichever is later, in
the business of Stena AB and Subsidiaries of Stena AB
as provided above. The amount of such Net Available
Proceeds neither used to repay or prepay Debt nor
used or invested (or deemed used or invested) as set
forth in the preceding sentences constitutes "Excess
Proceeds."
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(C) If at any time the aggregate amount of Excess Proceeds not
previously applied pursuant to this Clause 10.7 equals
$30,000,000 or more, Stena AB shall apply such Excess
Proceeds:-
(i) first, to the extent of the remaining Excess Proceeds
at Stena AB's option, (a) to make an offer to purchase
the outstanding 2005 Notes (as required by the 2005
Indenture or any Successor Financing) at one hundred
per cent (100%) of their principal amount plus accrued
interest to the date of purchase or (b) to make an
offer to purchase the outstanding 2007 Notes at one
hundred per cent (100%) of their principal amount plus
accrued interest to the date of purchase;
(ii) second, if an offer to purchase is made under (C)(i)(a)
above and there are any, and to the extent of any,
remaining Excess Proceeds following completion of such
purchase, to make an offer to purchase the outstanding
2007 Notes (as required by the 2007 Indenture or any
Successor Financing) at one hundred per cent (100%) of
their principal amount plus accrued interest to the
date of purchase;
(iii) third, to the extent of any remaining Excess Proceeds
following the completion of the offer to purchase, to
the repayment of other Debt (other than Subordinated
Debt) of Stena AB and its Subsidiaries to the extent
permitted by the agreements governing such Debt; and
(iv) fourth, to the extent of any then remaining Excess
Proceeds, for general corporate purposes of Stena AB
and its Subsidiaries,
(D) This Clause 10.7 will not apply to a transaction consummated
in compliance with Section 8.1 (Mergers, Consolidations and
Certain Sales and Purchases of Assets) of each of the
Indentures (or the corresponding provision in any Successor
Financing).
10.8 Incurrence of Debt by Stena AB
(A) Stena AB shall not Incur any Debt unless:-
(i) immediately after giving effect to the Incurrence of
such Debt and the receipt and application of the
proceeds thereof, the Consolidated Interest Coverage
Ratio for the four full fiscal quarters for which
quarterly or annual financial statements are available
next preceding the Incurrence of such Debt, calculated
on a pro forma basis as if such Debt had been Incurred
(and the receipt and application thereof had been made)
at the beginning of such four full fiscal quarters,
would be greater than 2 to 1; and
(ii) no Default or Event of Default (as defined in the Notes
or any Successor Financing) shall have occurred and be
continuing at the time of, or after giving effect to,
the Incurrence of such Debt.
(B) Notwithstanding the foregoing limitation, Stena AB may Incur
the following Debt:-
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(i) Existing Debt;
(ii) Debt pursuant to the 2005 Notes or any Successor
Financing (to the extent not included in the
definition Existing Debt);
(iii) Debt pursuant to the 2007 Notes or any Successor
Financing (to the extent not included in the
definition Existing Debt);
(iv) Debt to finance the replacement of a Vessel owned or
leased under a Capitalised Lease Obligation by Stena
AB or any Subsidiary of Stena AB secured by a Lien of
the type described under paragraph (D) of the
definition of "Permitted Liens" upon a total loss,
destruction, condemnation, confiscation, requisition,
seizure, forfeiture or other taking of title to or
use of such Vessel (provided that such loss,
destruction, condemnation, confiscation, requisition,
seizure, forfeiture or other taking of title to or
use of such Vessel was covered by insurance or
resulted in the payment of compensation or similar
payments to such person) (collectively, a "RELEVANT
TOTAL LOSS") in an aggregate amount up to the Ready for
Sea Cost for such replacement Vessel less all
compensation, damages and other payments (including
insurance proceeds other than in respect of business
interruption insurance, protection and indemnity
insurance or other third-party liability insurance)
received from any person in connection with the
Relevant Total Loss in excess of amounts actually used
to repay Debt secured by the Vessel subject to the
Relevant Total Loss;
(v) Debt under any interest rate swap, foreign currency
hedge, exchange or similar agreements to the extent
entered into to hedge any other Debt permitted under
this Agreement or otherwise entered into in the
ordinary course of business;
(vi) Debt to renew, extend, refinance, replace or refund
(herein, "REFINANCE") any Debt permitted to be
Incurred under Clause 10.8(A) (including, without
limitation, Debt in respect of binding commitments
for Post-Delivery Financing permitted under Clause
10.8(A)), any Existing Debt or any Debt permitted to
be incurred under paragraphs (ii), (iii), (v), (vi)
or (viii) of this Clause 10.8(B) provided that:-
(a) the amount of such Debt does not exceed:-
(x) except as provided in (y) below, the
principal amount of Debt to be so
refinanced (which amount shall be
deemed to include the amount of any
undrawn or available amounts under
any committed credit or lease
facility being so refinanced); or
(y) in the case of the refinancing of
the Post-Delivery Financing of a
Vessel within two hundred and
seventy (270) days after the
acquisition or delivery of such
Vessel pursuant to a Capitalised
Lease Obligation, one
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hundred per cent (100%) of the Ready
for Sea Cost of such Vessel
plus, in either case, the amount of any
premium required to be paid in connection
with such refinancing pursuant to the terms
of the Debt refinanced or the amount of any
premium reasonably determined by Stena AB as
necessary to accomplish such refinancing by
means of a tender offer or privately
negotiated repurchase, plus the expenses of
Stena AB or any of its Subsidiaries Incurred
in connection with such refinancing; and
(b) the Incurrence of Debt the proceeds of which
are used to refinance Debt shall only be
permitted if the refinancing Debt by its
terms, or by the terms of any agreement or
instrument pursuant to which such Debt is
issued, has an Average Life and Stated
Maturity which is equal to or greater than
that of the Debt to be refinanced at the
time of the Incurrence of such refinancing
Debt;
(vii) Debt owed by Stena AB to any Subsidiary of Stena AB;
provided that upon either:-
(a) the transfer or other disposition by any
such Subsidiary of any Debt so permitted to
a person other than Stena AB or a Subsidiary
of Stena AB or
(b) the issuance, sale, transfer or other
disposition (other than a pledge of the
shares of such Subsidiary permitted under
Clause 10.6) of shares of Capital Stock
(including by consolidation or merger) of
such Subsidiary to a person other than Stena
AB or a Subsidiary of Stena AB which, after
giving effect thereto, results in such
Subsidiary ceasing to be a Subsidiary of
Stena AB,
the provisions of this paragraph (vii) shall no
longer be applicable to such Debt and such Debt shall
be deemed to have been Incurred at the time of such
transfer or other disposition;
(viii) Debt Incurred pursuant to this Agreement or under the
Revolving Credit Facilities and/or the Unsecured
Revolving Credit Facility and Debt Incurred by Stena
AB as guarantor in respect of the Stena Discovery
Facility Agreement and/or the ABN Standby Facility
Agreement; and
(ix) Debt of Stena AB not otherwise permitted to be
Incurred pursuant to paragraphs (ii) to (viii) above,
which, together with:-
(a) any other outstanding Debt Incurred pursuant
to this paragraph (ix) and/or Clause 10.9(I)
(and any outstanding Preferred Stock issued
by Subsidiaries of Stena AB pursuant to
Clause
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10.10(D)); and
(b) any other outstanding Debt Incurred after 1
October 1997 but before the date of this
Agreement pursuant to Section 10.8(vii)
and/or Section 10.9(viii) of the 2007
Indenture (and any outstanding Preferred
Stock issued by Subsidiaries of Stena AB
after 1 October 1997 but before the date of
this Agreement pursuant to Section 10.10(iv)
of the 2007 Indenture)
has an aggregate principal amount (and/or liquidation
preference) not in excess of $50,000,000 at any time
outstanding.
10.9 Incurrence of Debt by Subsidiaries
Stena AB will not permit any Subsidiary of Stena AB to Incur any Debt
except:-
(A) Debt to finance the replacement of a Vessel owned or leased
under a Capitalised Lease Obligation by that Subsidiary
secured by a Lien of the type described under paragraph (D)
of the definition of "Permitted Lien" upon a Relevant Total
Loss of such Vessel (as defined in Clause 10.8(B)(iv)) in an
aggregate amount up to the Ready for Sea Cost for such
replacement Vessel less all compensation, damages and other
payments (including insurance proceeds other than in respect
of business interruption insurance, protection and indemnity
insurance or other third-party liability insurance) received
from any person in connection with the Relevant Total Loss
in excess of amounts actually used to repay Debt secured by
the Vessel subject to the Relevant Total Loss; provided that
if the Debt Incurred by that Subsidiary in financing the
Vessel subject to the Relevant Total Loss is subordinated to
the Debt Incurred under this Agreement, the Debt Incurred to
finance the replacement Vessel shall be subordinated to the
same degree;
(B) Debt under any interest rate swap, foreign currency hedge,
exchange or similar agreements to the extent entered into by
that Subsidiary to hedge any other Debt permitted to be
Incurred by it under this Agreement or otherwise entered into
in the ordinary course of business;
(C) Debt owed to Stena AB or a Subsidiary of Stena AB provided
that upon either (x) the transfer or other disposition by
Stena AB or such Subsidiary of any Debt so permitted to a
person other than Stena AB or a Subsidiary of Stena AB or (y)
the issuance, sale, transfer or other disposition (other than
a pledge of the shares of such Subsidiary permitted under
Clause 10.6) of shares of Capital Stock (including by
consolidation or merger) of such Subsidiary to a person other
than Stena AB or another such Subsidiary which, after giving
effect thereto, results in such Subsidiary ceasing to be a
Subsidiary of Stena AB, the provisions of this paragraph (C)
shall no longer be applicable to such Debt and such Debt shall
be deemed to have been Incurred at the time of such transfer
or other disposition;
(D) subject to the satisfaction of the incurrence test set forth
in Clause 10.8(A), Debt Incurred by a person prior to the time
(a) such person became a Subsidiary of Stena AB, (b) such
person merges with or into or consolidates
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with a Subsidiary of Stena AB or (c) another Subsidiary of
Stena AB merges with or into or consolidates with such
person (in a transaction in which such person becomes a
Subsidiary of Stena AB), which Debt was not Incurred or
issued in anticipation of such transaction and was
outstanding prior to such transaction;
(E) subject to the satisfaction of the incurrence test set forth
in Clause 10.8(A), Debt of a Subsidiary of Stena AB secured by
a Lien of the type described under paragraph (D) of the
definition of "Permitted Liens";
(F) Debt to refinance Existing Debt of any Subsidiary and Debt to
refinance any Debt permitted to be Incurred pursuant to
paragraphs (A), (D), (E), (F) and (G) of this Clause 10.9
provided that:-
(i) the amount of such Debt does not exceed:-
(a) except as provided in (b) below, the
principal amount of Debt to be so refinanced
(which amount shall be deemed to include the
amount of any undrawn or available amounts
under any committed credit or lease facility
being so refinanced); or
(b) in the case of the refinancing of the
Post-Delivery Financing of a Vessel within
270 days after the acquisition or delivery
of such Vessel pursuant to a Capitalised
Lease Obligation, 100% of the Ready for Sea
Cost of such Vessel
plus, in either case, the amount of any premium
required to be paid in connection with such
refinancing pursuant to the terms of the Debt
refinanced or the amount of any premium reasonably
determined by Stena AB as necessary to accomplish
such refinancing by means of a tender offer or
privately negotiated repurchase, plus the expenses of
Stena AB or any of its Subsidiaries Incurred in
connection with such refinancing;
(ii) such refinancing Debt shall not be used to refinance
outstanding Debt or Preferred Stock of Stena AB; and
(iii) such refinancing Debt by its terms, or by the terms
of any agreement or instrument pursuant to which such
Debt is issued, has an Average Life and Stated
Maturity which is equal to or greater than that of
the Debt to be refinanced at the time of the
Incurrence of such refinancing Debt;
(G) Debt Incurred under this Agreement and/or the Stena Discovery
Facility Agreement and/or the ABN Standby Facility Agreement
and/or the Revolving Credit Facilities including, without
limitation, Debt Incurred pursuant to guarantees made by
Subsidiaries of Stena AB in respect of this Agreement and/or
the Stena Discovery Facility Agreement and/or the ABN Standby
Facility Agreement and/or the Revolving Credit Facilities;
(H) Debt of any Subsidiary pursuant to a guarantee issued pursuant
to the first paragraph of Section 10.13 of either Indenture or
the corresponding provision
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of any Successor Financing;
(I) Debt of Subsidiaries of Stena AB not otherwise permitted to be
Incurred pursuant to paragraphs (A) through (H) above which
together with:-
(i) any other outstanding Debt Incurred pursuant to this
paragraph (I) and/or Clause 10.8(B)(ix) (and any
outstanding Preferred Stock issued by Subsidiaries of
Stena AB pursuant to Clause 10.10(D)); and
(ii) any other outstanding Debt Incurred after 1 October
1997 but before the date of this Agreement pursuant
to Section 10.8(vii) and/or Section 10.9(viii) of the
2007 Indenture (and any outstanding Preferred Stock
issued by Subsidiaries of Stena AB after 1 October
1997 but before the date of this Agreement pursuant
to Section 10.10(iv) of the 2007 Indenture)
has an aggregate principal amount (and/or liquidation
preference) not in excess of $50,000,000 at any time
outstanding.
10.10 Limitation on Preferred Stock of Subsidiaries
Stena AB will not permit any of its Subsidiaries to issue, directly or
indirectly, any Preferred Stock except:-
(A) Preferred Stock of a Subsidiary of Stena AB issued to and held
by Stena AB or any of its Wholly Owned Subsidiaries, provided
that any subsequent issuance or transfer of any Capital Stock
which results in such Wholly Owned Subsidiary ceasing to be a
Wholly Owned Subsidiary of Stena AB or any transfer of such
Preferred Stock by any such Wholly Owned Subsidiary will, in
each case, be deemed an issuance of Preferred Stock;
(B) Preferred Stock issued by a person prior to the time (i) such
person becomes a Subsidiary of Stena AB, (ii) such person
merges with or into or consolidates with a Subsidiary of Stena
AB or (iii) another Subsidiary of Stena AB merges with or into
or consolidates with such person (in a transaction in which
such person becomes a Subsidiary of Stena AB), which Preferred
Stock was not issued in anticipation of such transaction;
(C) Preferred Stock (other than Disqualified Stock) which is
exchanged for Preferred Stock permitted to be outstanding
pursuant to paragraphs (A) and (B) above or which is used to
refinance Debt (or any refinancing thereof), having a
liquidation preference not to exceed the liquidation
preference of the Preferred Stock in the principal amount of
the Debt so refinanced; and
(D) Preferred Stock issued by Subsidiaries of Stena AB not
otherwise permitted to be issued pursuant to paragraphs (A)
through (C) above which together with:-
(i) any other Preferred Stock outstanding pursuant to
this paragraph (D);
(ii) any Debt of Subsidiaries of Stena AB Incurred
pursuant to Clause 10.9(I);
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(iii) any Debt of Stena AB Incurred pursuant to
Clause 10.8(B)(ix); and
(iv) any other outstanding Debt Incurred after 1 October
1997 but before the date of this Agreement pursuant
to Section 10.8(vii) and/or Section 10.9(viii) of the
2007 Indenture (and any outstanding Preferred Stock
issued by Subsidiaries of Stena AB after 1 October
1997 but before the date of this Agreement pursuant
to Section 10.10(iv) of the 2007 Indenture)
has an aggregate principal amount (and/or liquidation
preference) not in excess of $50,000,000 at any time
outstanding.
10.11 Limitation on Investments
Except with the prior written consent of the Majority Banks, the
Borrower and Stena AB will not, and shall procure that no other member
of the Stena AB Group will, make any Investment in any person (other
than Stena AB, any Subsidiary of Stena AB or any person which, after
giving effect to such Investment, would become a Subsidiary of Stena
AB) except Permitted Investments.
10.12 Business activities
Stena AB will not, and will not permit any of its Subsidiaries (other
than any Unrestricted Subsidiaries) to, engage in any type of business
other than the business Stena AB and its Subsidiaries are engaged in on
the date of this Agreement, other business activities within the
shipping, offshore oilfield services and real estate investment and
management industries and (as determined in good faith by the Board of
Directors of Stena AB) other business activities complementary,
incidental or reasonably related thereto.
10.13 Mergers and consolidation
Except with the prior written consent of the Majority Banks, neither
the Borrower nor any other Security Party will merge or consolidate
with any other person save for a merger or consolidation by operation
of law with one or more other entities into a single surviving entity
which is the Borrower or (as the case may be) such other Security Party
and which succeeds by operation of law to all of the assets and
liabilities of the Borrower or (as the case may be) such other Security
Party immediately prior to such merger or consolidation.
10.14 Restricted payments by Stena AB Group
Stena AB will not, and will not permit any Subsidiary of Stena AB
(other than an Unrestricted Subsidiary) to, directly or indirectly:-
(A) declare or pay any dividend, or make any distribution of any
kind or character (whether in cash, property or securities),
in respect of any class of Stena AB's Capital Stock to the
holders thereof, excluding any dividends or distributions
payable solely in shares of the Capital Stock of Stena AB or
in options, warrants or other rights to acquire the Capital
Stock of Stena AB;
(B) purchase, redeem, defease, or otherwise acquire or retire for
value:-
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(i) any Capital Stock of Stena AB or any Related Person
of Stena AB; or
(ii) any options, warrants or rights to purchase or
acquire shares of Capital Stock of Stena AB or any
Related Person of Stena AB or any securities
convertible or exchangeable into shares of Capital
Stock of Stena AB or any Related Person of Stena AB,
in either case other than acquisitions of Capital
Stock or options, warrants or rights to acquire such
Capital Stock pursuant to paragraph (C) of the
definition of "Permitted Investments";
(C) make any Investment in any Affiliate or Related Person of
Stena AB (other than Stena AB or a Subsidiary of Stena AB) and
other than a person which becomes a Subsidiary of Stena AB as
a result of such Investment) provided that this paragraph (C)
shall not prohibit the making of an Investment otherwise
permitted under Clause 10.11;
(D) redeem, defease, repurchase, retire or otherwise acquire or
retire for value prior to any scheduled maturity, repayment or
sinking fund payment, Debt of Stena AB which is subordinate in
right of payment to the 2005 Notes and the 2007 Notes or any
Successor Financing, except to the extent that payment for
such Debt is made from the proceeds of a simultaneous
refinancing of such Debt otherwise permitted under the
Indentures or any Successor Financing; or
(E) declare or pay any dividend or make any distribution of any
kind or character (whether in cash, property or securities) on
any Capital Stock of any Subsidiary of Stena AB (except where
Stena AB or any Subsidiary of Stena AB receives a rateable
portion of such dividend or distribution) to any person (other
than Stena AB or any Subsidiary of Stena AB) or purchase,
redeem or otherwise acquire or retire for value any Capital
Stock of any Subsidiary of Stena AB held by any person (other
than Stena AB or any Subsidiary of Stena AB)
each of the matters described in paragraphs (A) to (E) being a
"Restricted Payment" if at the time thereof:-
(i) a Default or Event of Default as defined in the
Indentures shall have occurred and is continuing; or
(ii) upon giving effect to such Restricted Payment, Stena
AB could not Incur at least $1 of additional Debt
pursuant to Clause 10.8(A); or
(iii) upon giving effect to such Restricted Payment, the
aggregate of all Restricted Payments, together with,
(a) payments on guarantees of obligations of
Affiliates or Related Persons (other than Stena AB or
a Subsidiary of Stena AB) of Stena AB in effect on
the date of the 2007 Indenture but only to the extent
such payments have not been reimbursed in accordance
with the terms of the relevant guarantee or other
agreement, and (b) outstanding Investments made
pursuant to paragraph (B) of the definition of
"Permitted Investments" (or, in respect of
Investments made prior to the date of this Agreement,
paragraph (ii) of the definition of "Permitted
Investments" in the 2007
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Indenture) in either case made after the date of the
2007 Indenture exceeds the greater of:-
(a) the sum of (x) fifty per cent (50%) of
cumulative Consolidated Net Income of Stena AB
(or, if cumulative Consolidated Net Income of
Stena AB shall be negative, less one hundred per
cent (100%) of such deficit) since the end of
the most recent fiscal quarter of Stena AB ended
on or prior to the date of the 2007 Indenture
through the last day of the period for which
quarterly or annual financial statements of
Stena AB are available, plus (y) one hundred per
cent (100%) of the aggregate net proceeds
received after the date of the 2007 Indenture,
including the fair value of property other than
cash, from the issuance of Capital Stock (other
than Disqualified Stock) of Stena AB and
warrants, rights or options on Capital Stock
(other than Disqualified Stock) of Stena AB and
the principal amount of Debt that has been
converted into Capital Stock (other than
Disqualified Stock) of Stena AB after the date
of the 2007 Indenture, plus (z) $50,000,000; or
(b) $50,000,000.
The foregoing provisions will not prohibit the payment of any dividend
on Capital Stock of any class within sixty (60) days after the
declaration thereof if, on the date when the dividend was declared,
such dividend could have been paid in accordance with the provisions of
the foregoing covenant.
Under Swedish law, any shareholder of a Swedish corporation owning ten
per cent (10%) or more of the outstanding shares of such corporation
has the right to demand the payment of dividends from the profits of
the corporation in accordance with the Swedish Companies Act. Whilst
this Agreement cannot prevent the payment of a dividend by Stena AB
under such circumstances, the declaration or payment by Stena AB of
dividends (or other distributions) in excess of the amount then
permitted under this Clause 10.14 shall constitute an Event of Default
under this Agreement.
10.15 Financial year
Except with the prior written consent of the Agent (such consent not to
be unreasonably withheld or delayed), the Borrower and Stena AB will
not alter their respective financial years.
10.16 Ownership of Stena AB Group companies
Stena AB will procure that each of the Security Parties which are at
the date hereof members of the Stena AB Group (other than Stena AB
itself) remain Subsidiaries of Stena AB and that none of the shares of
any person which is a Security Party at any time during the Security
Period shall (except in favour of the Security Agent) be pledged to any
person.
10.17 Stena International Group working capital
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(A) Stena AB and the Borrower will procure that:-
(i) the aggregate of (i) the Consolidated Current Assets
and (ii) Available Facilities shall be not less than
one hundred and twenty five per cent (125%) of the
Consolidated Current Liabilities; and
(ii) the aggregate of (i) Consolidated Liquid Assets and
(ii) Available Facilities shall be not less than
$50,000,000.
(B) The requirements contained in this Clause 10.17 as to the
financial condition of the Stena International Group shall be
tested as at 30 September 2001 and each of the dates falling
three (3) monthly thereafter in each case by reference to the
Audited Stena International Financial Statements and the
unaudited financial statements delivered to the Agent pursuant
to Clause 10.2 provided however that no breach shall be deemed
to have arisen under this Clause 10.17 unless and until the
Borrower shall, within ten (10) Banking Days following receipt
by the Borrower of written notification from the Agent that a
shortfall has occurred under this Clause 10.17 have failed to
satisfy the Agent that such shortfall has been eliminated.
(C) For the purposes of this Clause 10.17, accounting terms are
used and shall be construed in accordance with Dutch GAAP but
so that:-
"AVAILABLE FACILITIES" means, at any relevant time, the
undrawn amount of any committed loan or overdraft facilities
(including the facilities provided under this Agreement)
available to one or more members of the Stena International
Group at the date of such financial statements;
"CONSOLIDATED CURRENT ASSETS" means the aggregate at the date
of computation of the consolidated stocks, assets held for
sale, receivables and prepayments, intercompany receivables,
securities, cash at banks and in hand and other current assets
(as determined in accordance with Dutch GAAP) of the Stena
International Group;
"CONSOLIDATED CURRENT LIABILITIES" means the aggregate at the
date of computation of intercompany payables and other current
liabilities (as determined in accordance with Dutch GAAP) of
the Stena International Group;
"CONSOLIDATED LIQUID ASSETS" means the aggregate of:-
(i) the cash and Cash Equivalents of the Borrower and its
Subsidiaries; and
(ii) the market value of shares or other marketable debt
or equity securities held by members of the Stena
International Group which are quoted on any
recognised stock exchange or over the counter or
similar market in any member of the European Union or
European Economic Area, U.S.A., Canada, Hong Kong,
Tokyo, Singapore or as otherwise approved by the
Agent and other marketable securities having a rating
of no less than BBB- from Standard & Poor's
Corporation or ▇▇▇▇▇'▇
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Investors Service Inc or other rating agency which
the Agent accepts to be of equivalent standing
provided that cash or Cash Equivalents expressed or
denominated in a currency other than Dollars shall be
converted into Dollars by reference to the rate of exchange
used for conversion of such currency in the consolidation of
the relevant consolidated balance sheets or, if the relevant
currency was not thereby involved, by reference to the rate of
exchange or approximate rate of exchange ruling on such date
and determined on such basis as the Borrower's auditors may
determine or approve.
10.18 Early redemption or defeasance of Notes
Stena AB will not exercise its rights of optional redemption of any of
the Notes under Article XI (Redemption of Securities) of either of the
Indentures or its rights of defeasance of the Notes under Article XII
(Defeasance and Covenant Defeasance) of either of the Indentures or
voluntarily redeem or repay any Successor Financing unless such
optional redemption, defeasance or voluntary repayment of the Notes or
(as the case may be) such voluntary redemption, defeasance or repayment
of the Successor Financing is fully financed on the date thereof by an
Acceptable Refinancing and for the purposes of this clause:-
"ACCEPTABLE REFINANCING" means Debt incurred by Stena AB or any
Subsidiary of Stena AB other than the Borrower (otherwise than from
other members of the Stena AB Group) which:-
(A) is for an amount not less than the amount required to effect
such optional redemption, defeasance or voluntary repayment of
the Notes or (as the case may be) voluntarily to redeem,
defease or repay the relevant Successor Financing;
(B) is on terms that the scheduled date for repayment or
redemption of such Debt is no earlier than the scheduled
maturity date of the relevant Notes or (as the case may be)
Successor Financing being refinanced and that the person or
persons to whom such Debt is owed is or are not entitled to
require any earlier repayment or redemption in circumstances
more onerous upon Stena AB or such Subsidiary of Stena AB than
those applicable in respect of the Notes or relevant Successor
Financing; and
(C) is not secured or preferred by any Liens over any of the
Mortgaged Ships or other assets or rights mortgaged, charged
or assigned to the Security Agent pursuant to the Security
Documents from time to time or any of their Insurances or
Requisition Compensation or by a pledge of shares of any
Security Party; and
"SUCCESSOR FINANCING" means:-
(A) any Debt incurred for the purpose of assisting Stena AB to
effect optional redemption of the Notes under Article XI of
the Indentures or for the purpose of assisting Stena AB or any
other member of the Stena AB Group voluntarily to repay the
Notes; or
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(B) any other Debt incurred for the purpose of assisting Stena AB
or any other member of the Stena AB Group to redeem or repay
any such Debt referred to in sub-paragraph (A) or which,
directly or indirectly, refinances any such Debt.
10.19 Application of proceeds
Stena AB and the Borrower will procure that the facilities provided
under this Agreement are applied for the purposes specified in Clause
1.1.
10.20 Restrictions on guarantees, etc.
Except as provided in this Agreement, the Borrower shall not, and shall
procure that none of its Subsidiaries shall, give any guarantee or
indemnify or grant any security in favour of any person in respect of
any obligation of any member of the Stena AB Group other than the
Borrower or a Subsidiary or another Subsidiary of the Borrower except
that the Borrower or a Subsidiary of the Borrower may in its capacity
as charterer of a Vessel owned by, or let under a Capitalised Lease
Obligation to, a member of the Stena AB Group which is not the Borrower
or a Subsidiary of the Borrower give security by way of a charterer's
assignment of earnings and/or insurances if required in connection with
the financing or refinancing of that Vessel where the liability of the
Borrower or its relevant Subsidiary in respect of such financing or
refinancing is limited to the value of the earnings and/or insurances
so assigned by it and where, in the case of a Vessel owned by a
relevant member of the Stena AB Group, such owner has executed a
mortgage on the Vessel as security for such financing or refinancing.
10.21 Asset coverage calculation
(A) Asset coverage covenant
Stena AB and the Borrower will procure that the ratio of
Available Asset Value to Unsecured Debt shall be not less than
2.5:1.
(B) Testing of covenant
The requirements contained in this Clause 10.21 as to the
ratio of Available Asset Value to Unsecured Debt shall be
tested as at 31 December 2001 and each of the dates falling
six (6) monthly thereafter or (if so requested in writing by
the Agent (acting on the instructions of the Majority Banks))
as at the end of any other calendar quarter (each such date a
"REFERENCE DATE" for the purposes of this Clause 10.21), in
each case by reference to the Audited Stena AB Financial
Statements and unaudited consolidated management accounts of
the Stena AB Group and the Asset Coverage Compliance
Certificate delivered to the Agent pursuant to Clause 10.2
provided however that no breach shall be deemed to have arisen
under this Clause 10.21 if a shortfall has occurred under this
Clause 10.21 but the Borrower is able to satisfy the Agent
within ten (10) Banking Days of the Agent's receipt of the
Asset Coverage Certificate evidencing that such shortfall has
been eliminated.
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(C) Defined terms
For the purposes of this Clause 10.21 and Clause 10.2(F),
accounting terms are used and shall be construed in accordance
with Swedish GAAP but so that as at any Reference Date:-
"APPRAISED VALUE OF RESTRICTED GROUP ASSETS" means the value,
determined in accordance with this Clause 10.21, of the
following assets of the Restricted Group, on a consolidated
basis:-
(i) completed vessels owned by or, pursuant to a
Capitalised Lease Obligation, chartered to any member
of the Restricted Group;
(ii) ongoing newbuilding and other projects;
(iii) machinery and equipment;
(iv) ports and other real estate owned by or, pursuant to
a Capitalised Lease Obligation, leased to members of
the Restricted Group;
(v) all other assets and properties of the Restricted
Group
but excluding Strategic Investments, Cash and Marketable
Securities, Net Market Value of the Unrestricted Group and
Other Assets and Working Capital;
"AVAILABLE ASSET VALUE" means the amount which is the sum,
determined on a consolidated basis of:-
(i) the Appraised Value of Restricted Group Assets; minus
(ii) Secured Debt; plus
(iii) Strategic Investments; plus
(iv) Cash and Marketable Securities; plus
(v) Net Market Value of the Unrestricted Group; plus
(vi) Other Assets and Working Capital;
"CASH AND MARKETABLE SECURITIES" means the aggregate value
determined on a consolidated basis, of all:-
(i) cash and cash equivalents;
(ii) shares or other marketable equities;
(iii) bonds, floating rate notes and other marketable debt
securities
owned by members of the Restricted Group less the amount of
any Debt owing by any member of the Restricted Group in
relation to the property referred to in paragraphs (ii) and
(iii) of this definition;
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"NET MARKET VALUE OF THE UNRESTRICTED GROUP" means the amount,
determined on a consolidated basis, which is the sum of:-
(vii) the capital stock, reserves, any convertible
subordinated debentures and deferred income taxes of
the Unrestricted Group plus the amount by which the
aggregate value of the assets of the Unrestricted
Group determined on a consolidated basis and in
accordance with this Clause 10.21 exceeds the
aggregate book value of such assets or minus the
amount by which such aggregate value as so determined
is less than such aggregate book value; plus
(viii) the value of any Debt owed to members of the
Restricted Group by members of the Unrestricted
Group;
"OTHER ASSETS AND WORKING CAPITAL" means the value determined
on a consolidated basis of all current and other assets of the
Restricted Group (excluding the Appraised Value of Restricted
Group Assets, Strategic Investments, Cash and Marketable
Securities and Net Market Value of the Unrestricted Group)
less the amount of the current liabilities of the Restricted
Group and less deferred tax as shown in the balance sheet;
"RESTRICTED GROUP" means all members of the Stena AB Group
which are not Unrestricted Subsidiaries;
"SECURED DEBT" means the aggregate of all outstanding Debt of
the Restricted Group on a consolidated basis which is at such
time owed to parties who are not members of the Stena AB Group
and is secured by a Lien in respect of any asset of the
Restricted Group or, in the case of Debt in respect of a
Capitalised Lease Obligation, the Debt outstanding under the
relevant lease but excluding Debt owing by any member of the
Restricted Group in relation to the property referred to in
paragraphs (ii) and (iii) of the definition of "Cash and
Marketable Securities";
"STRATEGIC INVESTMENT" means the value, determined on a
consolidated basis, of all Investments owned by members of the
Restricted Group which Stena AB considers to be of a strategic
nature (which, as at the date of this Agreement presently
comprises the P&O Stena Shares and the P&O Stena Loan Stock);
"UNRESTRICTED GROUP" means all members of the Stena AB Group
which are Unrestricted Subsidiaries;
"UNSECURED DEBT" means the aggregate of all outstanding Debt
of the Restricted Group on a consolidated basis which is at
such time owed to parties who are not members of the Stena AB
Group and is not secured by a Lien in respect of any asset of
the Restricted Group but excluding Debt owing by any member of
the Restricted Group in relation to the property referred in
paragraphs (ii) and (iii) of the definition of "Cash and
Marketable Securities",
each as at the relevant Reference Date and so that the value
of any assets or property is determined in accordance with the
following provisions of this
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Clause 10.21 and the amount of any liability shall be
determined in the same manner in which it is determined for
the purpose of the balance sheet of the relevant member of
the Stena AB Group as at the Reference Date in accordance
with Swedish GAAP.
(D) Valuation of vessels and linkspans
Every completed vessel owned by or, pursuant to a Capitalised
Lease Obligation, chartered to any member of the Stena AB
Group (for the purposes of this Clause 10.21, a "RELEVANT
VESSEL") shall be valued in the manner and at the times
specified below.
The value of each Relevant Vessel shall be determined as being
the mortgage free value thereof. For these purposes, the
mortgage free value of each such Relevant Vessel shall be
assessed:-
(i) annually on the dates falling at twelve (12) monthly
intervals from 31 December 2001 as being the mean of
the valuations of the charter-free market value
thereof on a willing buyer/willing seller basis as
assessed as at the relevant date by, in the case of
any ro-ro or ferry, three leading European
shipbrokers active in the ro-ro/ferry market
appointed by the Borrower from the following list of
brokers:-
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ Shipping HB
Simsonship AB
Maersk Sales
Parimar Francharte S.A.
English White Shipping Ltd.
Nor Ocean
in the case of any drilling rig, by three leading
shipbrokers active in the offshore market appointed
by the Borrower from the following list of brokers:-
Fearnleys A/S
▇▇▇▇▇▇▇ ▇▇▇▇
Bassoe Offshore A/S
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Salles
Seascope Offshore
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in the case of any crude oil or other products
tanker, by three leading shipbrokers active in the
tanker market appointed by the Borrower from the
following list of brokers:-
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ & Associates
H Clarkson & Co. Ltd.
Bassoe A/S
Fearnleys A/S
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ Shipbrokers
▇▇▇▇▇▇▇▇ Tankers AB
or any other brokers nominated by the Borrower and
approved by the Agent;
(ii) annually on the dates falling at twelve (12) monthly
intervals from 30 June 2002 as being the market value
thereof as approved as at the relevant date by the
Board of Directors.
For this purpose, any current valuation of a Mortgaged Ship
provided pursuant to Clause 5.3(G) shall satisfy the
Borrower's obligation to provide a broker valuation for such
Mortgaged Ship pursuant to Clause 10.21(D)(i).
The value of any linkspan owned by any member of the Stena AB
Group shall be its book value (as determined in accordance
with Swedish GAAP).
(E) Valuation of newbuilding contracts
Any vessel under construction owned by, or contracted for
delivery on completion to, any member of the Stena AB Group
(whether as owner or pursuant to a Capitalised Lease
Obligation) and any contract entered into for the construction
of such a vessel shall be valued at its book value (as
determined in accordance with Swedish GAAP).
(F) Valuation of Ports
The value of any port shall be the amount (expressed in
Swedish kronor by reference to exchange rates prevailing on
the Reference Date) determined as the earnings before
interest, taxes, depreciation and amortisation in respect of
the relevant port as shown in the then latest audited accounts
of the owner of the relevant port multiplied by six and one
half (6.5).
For this purpose, any current valuation of Holyhead Port and
Stranraer Port provided pursuant to Clause 5.3(H) shall
satisfy the Borrower's obligation to provide a valuation for
such Port pursuant to this Clause 10.21(F).
(G) Valuation of other real estate
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The value of any real estate (other than ports) owned by any
member of the Stena AB Group shall be the value thereof as
determined by the management of the relevant owning company as
being its market value.
(H) Valuation of P&O Stena Shares
The value of the P&O Stena Shares held by any member of the
Stena AB Group shall be the amount (expressed in Swedish
kronor by reference to exchange rates prevailing on the day of
computation) which is the Stena percentage of the sum of:-
(i) the earnings before interest, taxes, depreciation and
amortisation of P&O Stena for the twelve month period
as shown in the then latest audited accounts of P&O
Stena multiplied by six point five (6.5); plus
(ii) the cash and working capital (being, for this
purpose, the current assets minus current liabilities
but excluding interest bearing debt, pension
liabilities and other similar provisions) of P&O
Stena as shown in its then latest audited accounts;
minus
(iii) interest bearing debt and leases as shown in its then
latest audited accounts; minus
(iv) (without double counting) the amount of any
outstanding loans stock of P&O Stena as shown in its
then latest audited accounts
and, for this purpose, "STENA PERCENTAGE" means share capital
in P&O Stena owned by members of the Stena AB Group at the
relevant time (currently 40%).
(I) Value of other Strategic Investments
The value of any Strategic Investment other than P&O Stena
Shares held or owned by any member of the Stena AB Group shall
be:-
(i) in the case of P&O Stena Loan Stock, its book value
as determined in accordance with Swedish GAAP and the
accounting policies of the Stena AB Group;
(ii) in the case of any listed securities or shares, their
market value; and
(iii) in the case of any other Strategic Investment, its
book value as determined in accordance with Swedish
GAAP and the accounting policies of the Stena AB
Group or otherwise as determined by such method of
valuation as shall from time to time be agreed
between the Agent (acting on the instructions of the
Majority Banks) and the Borrower having regard to the
nature of the relevant Strategic Investment.
(J) Valuation of other assets
The value of any other assets not referred to in (D) to (I)
above owned by any
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member of the Stena AB Group shall be the book value thereof
as determined in accordance with Swedish GAAP and the
accounting policies of the Stena AB Group.
11. SHIP AND LINKSPAN COVENANTS : INSURANCE
11.1 Duration
Stena AB and the Borrower undertake to the Agent, the Security Agent,
the Co-Arrangers and the Banks that throughout the Security Period they
will procure that in relation to each Mortgaged Ship and each Mortgaged
Linkspan:-
(A) during any period for which the Ship or Linkspan is in service
under a bareboat charter to a charterer which is not a member
of the Stena AB Group, the Shipowner and each Stena Charterer
of the relevant Ship or Linkspan will use its reasonable
endeavours to procure that:-
(i) the covenants as to insurance of the relevant Ship or
Linkspan in such bareboat charter are complied with
by such charterer so that the insurances are
maintained in force in accordance with the
requirements of the Commercial Documents;
(ii) the rights of the Security Agent are protected by the
endorsement of loss payable clauses on the Insurances
(other than any Insurances for the benefit of such
charterer and which are not for the benefit of the
Shipowner or are effected in excess of the amount of
cover required to be effected by the charterer under
the terms of the relevant charterer) which will
provide for payment to the Security Agent of all
moneys in respect of Total Loss proceeds and, in the
case of a Mortgaged Ship or Mortgaged Linkspan (but
only on terms that such claims shall be paid to the
relevant charterer insofar as the relevant moneys
belong to the charterer and may not be applied by the
relevant Shipowner or any Stena Charterer in or
towards payment of any amounts owing to them by such
charterer pursuant to the relevant charter and shall
not otherwise be applied in or towards payment of
amounts owing under any of the Security Documents)
Major Casualty claims; and
(iii) in the case of a Mortgaged Ship or Mortgaged Linkspan
which is let on bareboat charter hereafter, the
relevant bareboat charter includes obligations on the
charterer not materially less favourable to the
Shipowner or Stena Charterer as disponent owner than
those set out in Schedule 20;
provided that following the occurrence of an Event of Default
and for so long as such Event of Default is continuing the
Borrower shall procure that the Shipowners and each Stena
Charterer will comply with the directions of the Security
Agent in relation to the exercise of its rights in relation to
the Insurances relating to each Mortgaged Ship and Mortgaged
Linkspan;
(B) during any period for which the Ship or Linkspan is not
employed on such a bareboat charter, the Shipowner will comply
and/or procure that any Stena
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Charterer who is chartering the Ship or Linkspan under a
bareboat charterer will comply with the covenants set out in
Clauses 11.2 through 11.19 and will execute and deliver in
favour of the Security Agent or, in the case of m.v. "STENA
GERMANICA" (as long as she remains owned by Scandlines
subject to the Stena Germanica Mortgage), the Borrower a
Charterer's Subordination Undertaking and a Charterer's
Insurance Assignment on or before delivery of the Ship
and/or Linkspan to the relevant Stena Charterer under the
charter; and
(C) the aggregate value of the Insurances placed in respect of
Total Loss and which, subject to the relevant Ship Mortgage
and/or Insurance Assignment and/or Charterer's Insurance
Assignment are receivable and which may be retained pursuant
to the Commercial Documents by the Shipowners in respect of
the Mortgaged Ships and by the sellers of any Transferred
Ships from time to time (when aggregated to the value of the
insurances taken out in respect of the Ports pursuant to
Clause 13.2) is at all times during the Security Period not
less than 120% of the total of the Commitments.
11.2 Risks insured and amount of cover
Each Shipowner shall insure its Mortgaged Ship and Mortgaged Linkspans
(if any) and keep them insured in the name of the Shipowner and any
other persons with an insurable interest therein against:-
(A) in the case of a Mortgaged Ship, fire and insurance marine
risks (including excess risks) and war risks on an agreed
value basis for not less than the market value of the Ship
(for which purpose the Ship shall be assessed with the benefit
of any charterparty being or to be performed by the Ship
unless the value would be greater if that charterparty were
not taken into account in which case the Ship shall be valued
without the benefit of any such charterparty);
(B) in the case of a Mortgaged Ship, protection and indemnity
risks for the full value and tonnage of the Ship which, in
respect of all risks within the protection and indemnity
insurances other than oil pollution risks, shall be in an
unlimited amount or (if unlimited cover ceases to be
available from any member of the "International Group" of
protection and indemnity associations or any successor
association or body of such associations) in the maximum
amount available to the Shipowner for the Ship from any
member of the International Group or such successor
association or body as may be selected by the relevant
Shipowner or Stena Charterer and which, in respect of oil
pollution liability risks included within the protection and
indemnity insurances, shall be in the maximum amount
available to the Shipowner for the Ship from time to time
through its ordinary basic entry with its protection and
indemnity association;
(C) in the case of a Mortgaged Ship, all other risks whatsoever
which are customarily insured against by leading operators of
vessels of the same age and type as in accordance with then
current industry practice and taking account of the areas in
which the Ships may trade from time to time;
(D) in the case of a Mortgaged Linkspan, loss or damage by fire,
theft, storm or
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accident and such other risks and matters in respect of
which the Linkspan is for the time being required by statute
or otherwise to be insured against and generally in
accordance with any relevant good shipping industry
practice, for not less than the original cost of the
Linkspan;
(E) in the case of a Mortgaged Linkspan, third party claims
arising in respect of damage to and loss of property or death
or injury to third parties arising directly or indirectly out
of the ownership, management, use or operation of the Linkspan
or the chartering thereof; and
(F) in the case of a Mortgaged Linkspan, all other risks
whatsoever which are customarily insured against by leading
operators of linkspans of the same age and type as the
Linkspan in accordance with then current industry practice and
taking account of the area in which the Linkspan is from time
to time located.
11.3 Port risk cover
While a Mortgaged Ship is laid up, port risk insurance may be taken out
on such Ship by the relevant Shipowner instead of hull insurance, on
normal market terms.
11.4 Terms of cover
Each Shipowner shall procure that the Insurances for its Mortgaged Ship
and Mortgaged Linkspans (if any) shall:-
(A) be effected through the Approved Brokers and reputable
independent insurance companies and/or underwriters in Europe,
North America, the Far East and other established insurance
markets in OECD countries except that the insurances against
protection and indemnity risks and war risks may be effected
by the entry of the Ship with such protection and indemnity
and war risks associations which are members of the
International Group or successor association or body or other
leading protection and indemnity and war risks associations;
(B) provide that all amounts payable thereunder shall be payable
in Dollars, Sterling, Euro or any other currency approved by
the Security Agent (such approval not to be unreasonably
withheld);
(C) in all other respects be in a form and on terms customary in
the insurance markets in which the cover is placed and/or as
otherwise approved by the Security Agent (such approval not to
be unreasonably withheld or delayed).
11.5 Notice of assignment of insurances and endorsement of the Security
Agent's interests
Each Shipowner and Stena Charterer (as the case may be) shall forthwith
upon execution by it of the relevant Insurance Assignment or Deed of
Covenants or Charterer's Insurance Assignment to be entered into by it
in respect of any Mortgaged Ship or Mortgaged Linkspan:-
(A) execute a Notice of Assignment of Insurances in respect of the
relevant Ship or Linkspan in the form required by the terms of
such Insurance Assignment or Deed of Covenant or Charterer's
Insurance Assignment and in accordance
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with normal market practice serve the same on all brokers,
insurance companies, underwriters, protection and indemnity
and/or war risks associations through whom any of the
policies or entries relating to the Insurances of such Ship
or Linkspan are effected; and
(B) procure that the interests of the Security Agent in the
Insurances of such Ship or Linkspan shall be endorsed upon all
slips, cover notes, policies, certificates of entry and other
instruments of insurance issued or to be issued in connection
with the Insurances by means of the incorporation therein of
the relevant Loss Payable Clause required by the terms of such
Insurance Assignment or Deed of Covenant or Charterer's
Insurance Assignment and the attachment thereto of the
relevant Notice of Assignment of Insurances referred to in
paragraph 11.5(A) above and/or by such other means and/or in
such other form as is customary or appropriate in the
insurance market in which the cover is placed and/or as the
Security Agent shall otherwise reasonably require
and, in the event that any further Mortgaged Ship or Mortgaged Linkspan
is delivered to any Stena Charterer under a demise charter after the
date of the relevant Charterer's Insurance Assignment entered into by
it, such Stena Charterer shall perform its obligations under paragraphs
(A) and (B) above in respect of such Mortgaged Ship or Mortgaged
Linkspan forthwith upon its delivery to such Stena Charterer.
11.6 Letters of undertaking
Each Shipowner shall procure that the Approved Brokers and any
protection and indemnity or war risks association in which its Ship may
from time to time be entered shall deliver to the Security Agent a
letter or letters of undertaking in such form as the Security Agent may
reasonably require having regard to the then current market practice
and the practices prescribed by the International Group or successor
association or body and/or the Lloyds Insurance Brokers' Committees
and/or any other professional association of which the Approved Brokers
are members.
11.7 Deposit and production of insurance documents
Each Shipowner shall procure in respect of its Mortgaged Ship and
Mortgaged Linkspans (if any):-
(A) that all original slips, cover notes, policies, certificates
of entry and other instruments of insurance issued from time
to time in respect of those of the Insurances in respect of
its Ship and Linkspans (if any) which are effected through
Approved Brokers shall forthwith be deposited with such
Approved Brokers and thereafter be held by the Approved
Brokers to the order of the Security Agent upon and subject to
such terms as the Security Agent shall reasonably require
having regard to the then current market practice and subject
to the rights of any prior assignee thereof;
(B) that, as soon as reasonably practicable upon the Security
Agent's request therefor, certified copies of the instruments
of insurance referred to in paragraph (A) above shall be
produced to the Security Agent by the Approved Brokers;
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(C) that, forthwith upon the Security Agent's request therefor,
certified copies of all certificates of entry and policies
relating to the Ship's entry with any protection and indemnity
association or war risks association shall be produced to the
Security Agent by such protection and indemnity and/or war
risks association (as appropriate).
11.8 Payment of premiums and calls
Each Shipowner shall punctually pay all premiums, calls, contributions
or other sums payable in respect of the Insurances and shall produce to
the Security Agent all relevant receipts or other evidence of payment
when so required by the Security Agent.
11.9 Waiver of broker's lien
Where any of the insurances effected through Approved Brokers form part
of a fleet cover and such Approved Brokers are or would be entitled to
exercise rights of set-off or cancellation in relation to claims under
such Insurances relating to a Mortgaged Ship or Mortgaged Linkspan for
non-payment of premiums in respect of other vessels or linkspans
covered by the same Insurances, such Shipowner shall use its reasonable
endeavours (having regard to then current market practice including the
practice prescribed by the Lloyds Insurance Brokers' Committee and/or
any other professional association of which the Approved Brokers are
members) to procure that the Approved Brokers shall undertake to the
Security Agent:-
(A) not to exercise against the policy or against any claims in
respect of the Ship or Linkspan (as the case may be) any lien
or right of set off for unpaid premiums in respect of vessels
or linkspans other than the Ship or Linkspan covered under
such fleet cover or for unpaid premiums in respect of any
other such policies of insurance;
(B) not to cancel the insurances for the Ship or Linkspan or by
reason of the non-payment of premiums for vessels or linkspans
(other than any Mortgaged Ships or Mortgaged Linkspans)
covered by such fleet cover;
or, in lieu of the undertakings referred to in paragraphs (A) and (B)
to issue a separate policy of insurance in respect of the Ship or
Linkspan (as the case may be) as and when the Security Agent may
reasonably so require.
11.10 Renewal of Insurances
Each Shipowner shall renew the Insurances (or relevant part thereof) in
respect of its Mortgaged Ship and Mortgaged Linkspans (if any) before
the relevant policies, contracts or entries expire and shall procure
that the Approved Brokers and/or the relevant protection and indemnity
association or war risks association or relevant Approved Manager shall
promptly confirm in writing to the Security Agent as and when each such
renewal has been effected.
11.11 Execution of guarantees
Each Shipowner shall promptly arrange for the execution and delivery of
such guarantees in respect of its Mortgaged Ship as may from time to
time be required by
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any protection and indemnity or war risks association in accordance
with its rules or the terms of entry of the Ship.
11.12 Information from brokers
Each Shipowner shall procure that the Approved Brokers and the managers
of any protection and indemnity and/or war risks association with which
its Ship is entered shall give to the Security Agent such information
as to the Insurances relating thereto as the Security Agent may
reasonably request.
11.13 Restriction on amendments to cover
No Shipowner shall without the prior consent of the Security Agent
(such consent not to be unreasonably withheld or delayed), make any
alteration to the terms of any of the Insurances of a Mortgaged Ship or
Mortgaged Linkspan which would or could reasonably be expected to have
a material adverse effect on the rights or interests of the Security
Agent nor shall any Shipowner take any action or omit to take any
action or suffer any act or omission which would or would be likely to
render any of the Insurances invalid, void, voidable, suspended,
defeated or unenforceable or render any sum payable thereunder
repayable in whole or in part (save and to the extent that replacement
cover has been effected in accordance with this Clause 11).
11.14 Major Casualties relating to Mortgaged Ships
In the event of a Major Casualty relating to any Mortgaged Ship the
proceeds of insurance claims in respect of such Major Casualty shall,
subject to the rights of any charterer (other than a Stena Charterer),
be paid to the Security Agent in accordance with the relevant Loss
Payable Clauses and:-
(A) if no Event of Default has occurred and is continuing, such
proceeds shall be applied by the Security Agent in or
towards payment on behalf of the relevant Shipowner or
bareboat charterer to the relevant repairer, salvor or other
relevant creditor in respect of the cost of repairs, salvage
or other charges unless the Shipowner or bareboat charterer
has first fully repaired the damage or secured complete
discharge of the liability insured against or otherwise made
good the loss in which case the Security Agent shall
reimburse the Shipowner or bareboat charterer therefor up to
the amount received by the Security Agent provided however
that the insurers with whom the fire and usual marine risks
insurances are effected may, in the case of a Major
Casualty, make payment on account of repairs in the course
of being effected; or
(B) if an Event of Default has occurred and is continuing, and the
Agent has given notice in accordance with Clause 15.2 the
Security Agent shall be entitled to apply such proceeds in the
manner specified in Clause 7.10.
11.15 Minor casualties relating to Mortgaged Ships; casualties relating to
Mortgaged Linkspans
Each Shipowner or relevant Stena Charterer shall apply all sums
receivable under the Insurances in respect of its Mortgaged Ship or
Mortgaged Linkspans (as the case may
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be) as are paid to it in accordance with the relevant Loss Payable
Clauses for the purpose of fully repairing the damage or securing
complete discharge of the liability insured against or otherwise
making good the loss in respect of which such sums shall have been
received and/or reimbursing itself for the expense of having
previously carried out such repairs, discharging such liability or
making good such loss.
11.16 Total Losses relating to Mortgaged Linkspans
In the event of a Total Loss relating to any Mortgaged Linkspan the
proceeds of insurance claims in respect of such Total Loss shall be
paid to the Security Agent in accordance with the relevant Loss Payable
Clauses and:-
(A) if no Event of Default has occurred and is continuing, such
proceeds shall be applied by the Security Agent in or
towards payment on behalf of the relevant Shipowner for the
purchase of a replacement Linkspan (it being a condition of
such payment that the relevant Shipowner execute a Linkspan
Mortgage in favour of the Security Agent immediately upon
its acquisition of title to such replacement Linkspan and
that, to the extent that to do so is consistent with market
practice, the Shipowner assign to the Security Agent the
benefit of the relevant building contract and any refund
guarantee (or provide other security acceptable to the
Majority Banks) where any proceeds of the Total Loss are
paid over to the manufacturer or supplier of the replacement
Linkspan before the relevant Shipowner acquires title
thereto); and
(B) if an Event of Default has occurred and is continuing, and the
Agent has given notice in accordance with Clause 15.2 the
Security Agent shall be entitled to apply such proceeds in the
manner specified in Clause 7.10.
11.17 Receipt of proceeds by the Shipowner
If, despite the provisions of the relevant Loss Payable Clauses, any
Shipowner or relevant Stena Charterer receives any proceeds of an
insurance claim in respect of a Major Casualty relating to its
Mortgaged Ship or Total Loss relating to its Mortgaged Linkspan before
having repaired the damage or discharged the liability or otherwise
made good the loss in respect of which the moneys are paid, such
Shipowner shall, subject to the rights of any prior assignee thereof,
immediately pay such proceeds to the Security Agent who shall apply
them in accordance with the relevant provisions of Clause 11.14 or
Clause 11.16 and until payment thereof to the Security Agent the
relevant Shipowner or relevant Stena Charterer shall hold the proceeds
on trust for the Security Agent.
11.18 Restriction on settlement of claims
Subject to the rights of any charterer (other than a Stena Charterer),
no Shipowner shall without the prior written consent of the Security
Agent settle, compromise or abandon any claim under the Insurances for
a Total Loss or Major Casualty relating to its Mortgaged Ship or
Mortgaged Linkspan (if any).
11.19 Assistance by the Shipowner
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Subject to the rights of any prior assignee of the Insurances each
Shipowner undertakes to do all things and provide all documents,
evidence and information as may be necessary to enable the Security
Agent to collect or recover any moneys which at any time become due in
respect of the Insurances relating to its Mortgaged Ship or Mortgaged
Linkspans (if any) and for such purpose (but without limitation) such
Shipowner shall permit the Security Agent if necessary to ▇▇▇ in that
Shipowner's name.
11.20 Employment in conformity with insurance cover
No Shipowner will at any time employ its Mortgaged Ship or Mortgaged
Linkspans (if any) or suffer them to be employed except in conformity
with the terms of the Insurances (including any express or implied
warranties) without first obtaining the consent to such employment of
the insurers and complying with such requirements as to extra premium
or otherwise as the insurers may prescribe and before allowing its Ship
to enter or trade to any zone which is declared a war zone by any
government or by the Ship's war risks insurers or which is rendered
dangerous by reason of hostility in any part of the world (whether war
be declared or not) to effect such special insurance cover so as to
ensure that such Ship is fully insured against war risks in accordance
with this Clause 11 while in such zone.
12. SHIP AND LINKSPAN COVENANTS : OPERATION AND MAINTENANCE
12.1 Duration
Stena AB and the Borrower undertake to the Agent, the Security Agent,
the Banks and the Co-Arrangers that throughout the Security Period they
will procure that in relation to each Mortgaged Ship and each Mortgaged
Linkspan:-
(A) during any period for which the Ship or Linkspan is in service
under a bareboat charter to a charterer which is not a member
of the Stena AB Group, the Shipowner and each Stena Charterer
of the relevant Ship or Linkspan will use its reasonable
endeavours to procure that:-
(i) the covenants as to registration, operation and
maintenance of the relevant Ship or Linkspan are
complied with by the person on whom such obligations
are imposed; and
(ii) in the case of a Mortgaged Ship or Mortgaged Linkspan
which is let on bareboat charter hereafter, the
relevant bareboat charter includes obligations on the
charterer not materially less favourable to the
Shipowner or Stena Charterer as disponent owner than
those set out in Schedule 20;
provided that following the occurrence of an Event of
Default and for so long as such Event of Default is
continuing the Borrower shall procure that the
Shipowners and each Stena Charterer will comply with
the directions of the Security Agent in relation to
the exercise of its rights under the Commercial
Documents relating to its Mortgaged Ship and
Mortgaged Linkspans (if any) and any charter or other
contract for the employment of the Ship or Linkspans
entered into hereafter; and
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(B) during any period for which the Ship or Linkspan is not
employed on a bareboat charter as described in paragraph (A)
above, the Shipowner will comply and/or procure that any Stena
Charterer who is chartering the Ship or Linkspan under a
bareboat charter will comply with the covenants set out in
Clauses 12.3 through 12.17.
12.2 Ship and Linkspan registration
Each Shipowner shall:-
(A) maintain the registration of its Mortgaged Ship under the
registry of the Flag State at the Port of Registry; and
(B) maintain the registration of its Mortgaged Linkspan under the
registry of the Flag State (but only if such Linkspan is
capable of registry in a ship registry or other central or
public registry)
and (save pursuant to and in accordance with Clause 19.5) shall not do
or omit to do anything or suffer any act or omission whereby such
registration may be forfeited or imperilled.
12.3 Standard of maintenance
Each Shipowner shall keep its Mortgaged Ship and Mortgaged Linkspans
(if any) in a good and efficient state of repair so as (in the case of
each Ship) to entitle such Ship to its Classification with a
Classification Society free of any requirement or recommendation
affecting class which has not been complied with in accordance with its
terms and (in the case of each Ship and Linkspan) so as to comply with
all material legislation of the Flag State and all other legislation,
regulations and requirements of any government, governmental agency or
other regulatory authority (statutory or otherwise) from time to time
applicable to such Ship and Linkspans. Each Shipowner shall procure
that all appropriate repairs to or replacements of any damaged, worn or
lost parts or equipment are carried out (both as regards workmanship
and quality of materials) so as not to diminish the value or class of
its Mortgaged Ship or Mortgaged Linkspans.
12.4 Removal of parts and equipment
No part or item of equipment whose removal would materially reduce the
value of any Mortgaged Ship or Mortgaged Linkspan shall be removed from
such Ship or Linkspan unless it is replaced promptly by a suitable part
or item and the replacement part or item:-
(A) is in the same or better condition than that part or item
removed or enhances the value and/or earning capacity of such
Ship or Linkspan;
(B) is (or upon its installation on board such Ship or Linkspan
will become) legally and beneficially wholly owned by the
relevant Shipowner;
(C) is free from Liens other than Permitted Ship Liens; and
(D) with effect from its installation on board such Ship or
Linkspan is subject to
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the security constituted by the Ship Mortgage or Linkspan
Mortgage (as the case may be) thereon.
12.5 Restriction on modifications
No Shipowner shall, without the prior consent of the Agent (such
approval not to be unreasonably withheld or delayed), make any
modifications to its Mortgaged Ship or any Mortgaged Linkspan or any
part thereof which would or might materially and adversely alter the
structure, type or performance characteristics of such Ship or Linkspan
or materially reduce its value.
12.6 Equipment belonging to third parties
No Shipowner shall, without the prior consent of the Agent (such
approval not to be unreasonably withheld or delayed), install on its
Mortgaged Ship or Mortgaged Linkspan any equipment belonging to a third
party which cannot be removed without causing significant damage to the
structure or fabric of such Ship or Linkspan.
12.7 Survey
Each Shipowner shall submit its Mortgaged Ship to such periodical or
other surveys as may be required for classification purposes and, if so
required by the Agent, such Shipowner shall supply to the Security
Agent copies of all survey reports in respect thereof.
12.8 Inspection
Each Shipowner shall permit surveyors or other persons appointed by the
Agent to board its Mortgaged Ship at all reasonable times (but so as
not to interfere with the ordinary operation of the Ship) for the
purpose of inspecting her condition and her class or other records or
satisfying themselves as to repairs proposed or already carried out
subject to such persons and the Security Agent signing an indemnity
and/or waiver letter reasonably required by the relevant shipyard or
the Shipowner or relevant bareboat charterer. Each Shipowner shall
afford all proper and reasonable facilities for such inspections and
also for inspections of the Mortgaged Linkspans if reasonably required
by the Agent.
12.9 Employment of Ships
No Shipowner shall knowingly or recklessly employ its Mortgaged Ship or
suffer her employment in any trade or business which is forbidden by
any applicable law or is otherwise illicit or in carrying illicit or
prohibited goods or in any manner whatsoever which may render her
liable to condemnation in a prize court or to destruction, seizure or
confiscation or that may expose such Ship to penalties or sanctions.
12.10 Information
Each Shipowner shall promptly provide the Agent with all such
information which the Agent may periodically and reasonably require
regarding its Mortgaged Ship and its Mortgaged Linkspans (if any),
their employment, position and engagements, particulars of all towages
and salvages and copies of all charters and other contracts for her
employment or otherwise concerning such Ship or Linkspans.
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12.11 Payment of trading expenses and wages
Each Shipowner shall promptly pay all tolls, dues and other outgoings
whatsoever in respect of its Mortgaged Ship, its Mortgaged Linkspans
(if any) and their Insurances and keep accounts in respect thereof in
accordance with its current practice. As and when the Agent may so
reasonably require each Shipowner shall make such accounts available
for inspection on behalf of the Agent and shall provide evidence
satisfactory to the Security Agent that the wages and allotments and
the insurance and pension contributions of the master and crew are
being regularly paid, that all deductions from crew's wages in respect
of any tax and/or social security liability are being properly
accounted for and that the master has no claim for disbursements other
than those incurred in the ordinary course of trading on the voyage (if
any) then in progress or completed prior to such inspection.
12.12 Avoidance and discharge of other liens
Each Shipowner shall in accordance with good shipping industry practice
pay and discharge or cause to be paid and discharged all debts, damages
and liabilities whatsoever which have given rise, or may give rise, to
maritime, statutory or possessory liens on or claims enforceable
against its Mortgaged Ship or its Mortgaged Linkspans (if any) under
the laws of all countries to whose jurisdiction such Ship or Linkspans
may from time to time be subject. If any Mortgaged Ship or Mortgaged
Linkspan is arrested pursuant to legal process or detained in exercise
or purported exercise of any such lien or claim as aforesaid the
relevant Shipowner shall use all reasonable endeavours to procure the
release of the Ship or Linkspan from such arrest or detention as soon
as reasonably practicable after receiving notice thereof by providing
bail or taking such other steps as the circumstances may require (but,
in the case of an arrest or detention as a consequence of claims or
alleged claims against a charterer of such Ship or Linkspan which is
not a member of the Stena AB Group, the relevant Shipowner or Stena
Charterer may defer procuring such release if it reasonably considers
it to be in the best commercial interests of the Stena AB Group and
provided that, unless otherwise agreed by the Agent, and for so long as
so doing does not involve any imminent likelihood of a sale of such
Ship or Linkspan by order of any court of competent jurisdiction).
12.13 Notice of mortgage
Each Shipowner will do everything necessary under the laws of any
relevant jurisdiction for the purpose of perfecting and maintaining the
Ship Mortgage in relation to its Mortgaged Ship and the Linkspan
Mortgage in relation to each of its Mortgaged Linkspans (if any) as a
valid and enforceable mortgage and for preserving the priority of such
Ship Mortgage and Linkspan Mortgage and, in particular (but without
limitation), it will keep on board its Ship each such document or
record as may be required by law and cause such particulars relating to
the relevant Ship Mortgage and Linkspan Mortgages to be recorded as may
be required by law.
12.14 Notification of certain events
Each Shipowner shall notify the Agent by telefax promptly upon the same
coming to its knowledge and in reasonable detail of:-
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(A) any casualty to its Mortgaged Ship which is or is likely to be
a Major Casualty;
(B) any occurrence in consequence whereof its Mortgaged Ship or
any Mortgaged Linkspan has become or is likely to become a
Total Loss;
(C) any requirement or recommendation made by its Classification
Society or by any competent authority in respect of its
Mortgaged Ship which has not been complied with by the date by
which it is required to be complied with (as extended by
agreement with the Classification Society) other than any such
requirement or recommendation the imposition of which is being
contested in good faith by the relevant Shipowner;
(D) any arrest or detention of its Mortgaged Ship or any Mortgaged
Linkspan or the exercise or purported exercise of any lien on
such Ship or Linkspan;
(E) its Mortgaged Ship or, if capable of registration, its
Mortgaged Linkspan ceasing to be registered under the laws of
its Flag State or anything which is done or omitted to be done
whereby such registration may be imperilled.
12.15 Restrictions on chartering-out
Except with the prior written consent of the Agent, no Shipowner and no
Stena Charterer shall let or employ a Mortgaged Ship or a Mortgaged
Linkspan:-
(A) on demise charter for any period;
(B) on any time or consecutive voyage charter for a term which
exceeds or which by virtue of any optional extensions therein
contained may exceed twenty-five (25) months' duration; or
(C) on terms which permit the charterer to purchase the Ship or
Linkspan (save for an option price which reflects the market
value of such Ship or Linkspan at the time the relevant option
is exercisable or a reasonable pre-estimate of such value
having regard to the other terms of the relevant charter and
save for a charter which is a hire purchase or conditional
sale agreement on Credit Terms);
provided however that:-
(i) no such consent shall be required in respect of a
charter to a Stena Charterer provided that the
relevant Stena Charterer has executed and delivered
to the Agent a Charterer's Subordination Undertaking
and (if the charter is a demise charter) a
Charterer's Insurance Assignment in relation to the
Mortgaged Ship and (if relevant) the Mortgaged
Linkspans and the Approved Manager shall have
delivered to the Security Agent a Manager's
Subordination Undertaking in relation thereto; and
(ii) in respect of the matters referred to in
sub-paragraph (B) of this Clause 12.15 the Agent's
consent shall be deemed to have been given thereto if
the relevant Shipowner shall not have been informed
by the Agent
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either in writing or by word of mouth that such
consent is refused within two (2) Banking Days in
Gothenburg and London of the time at which the
relevant Shipowner's application for such consent was
received by the Agent; and
(iii) the Agent shall not unreasonably withhold its consent
to any charter and it shall not for this purpose be
reasonable to withhold consent or to impose
conditions on its consent either (a) by reason of the
failure of the proposed charterer (other than a Stena
Charterer) to agree to grant an assignment of its
interest in the Insurances of the Ship and/or
Linkspan and/or to agree to subordinate its rights in
respect of the Ship and/or Linkspan and/or to agree
to subordinate its rights in respect of the Ship
and/or Linkspan to those of the security Agent as its
mortgagee and/or assignee of its Insurances (in each
case either at all or on terms required by the Agent)
and/or to agree the terms of the relevant charter
reflecting or containing the provisions of Clauses 11
and/or 12 or (b) by reason of the duration of the
charter and/or the identity and/or creditworthiness
of the charterer or (c) by reason of the relevant
Shipowner and/or any charterer (including a Stena
Charterer) failing to agree to assign its rights
under the relevant charter and/or in respect of the
Earnings of the Ship and/or Linkspan as security for
the obligations of the Borrower pursuant to the
Security Documents.
12.16 Management
No Shipowner or Stena Charterer shall appoint any manager of a
Mortgaged Ship or Mortgaged Linkspan other than an Approved Manager and
each Approved Manager of a Mortgaged Ship or Mortgaged Linkspan so
appointed by any Shipowner or Stena Charterer shall execute and deliver
to the Security Agent a Manager's Subordination Undertaking in relation
to each of the Mortgaged Ships and Mortgaged Linkspans from time to
time managed by it.
12.17 ISM Compliance
Each Shipowner shall comply, or procure that any other relevant person
such as the Approved Manager or bareboat charterer who has assumed the
responsibility for operation of its Mortgaged Ship for the purposes of
the ISM Code will comply, with the ISM Code or any replacement thereof.
13. COVENANTS IN RESPECT OF THE PORTS
13.1 Duration
Stena AB and the Borrower undertake to the Agent, the Security Agent,
the Co-Arrangers and the Banks that throughout the Security Period they
will procure that in relation to each Mortgaged Port the Port Owner
will comply with the covenants set out in Clauses 13.2 through 13.16.
13.2 Insurance
Save where the provisions of Clause 13.4 are applicable, each Port
Owner shall:-
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(A) insure and keep insured all such buildings, fixtures,
fittings, plant and machinery on its Mortgaged Port as are in
each case used or required in the ordinary course of the Stena
AB Group's business (other than those in respect of which the
Security Agent agrees that insurance is not reasonably
required) with such insurer and against such risks and in such
amounts (being no less than their full reinstatement value if
realistically capable of being so severely damaged as to
require reinstatement) and otherwise upon such terms as the
Security Agent may reasonably require;
(B) use its best endeavours to procure that a note of the Security
Agent's interest is endorsed on all insurance policies
relating thereto; and
(C) (if the Security Agent so requires) produce to or deposit with
the Security Agent all such insurance policies in respect of
its Mortgaged Port and the receipts for all premiums and other
payments necessary for effecting and keeping up such policies.
13.3 Security Agent's right to remedy breach of insurance covenants
If a Port Owner fails to comply with any of its obligations under
Clause 13.2 in respect of its Mortgaged Port (whether or not the Port
Mortgage relating thereto shall have become enforceable) the Security
Agent may, but without being under any duty to do so, itself insure and
keep insured any of the buildings, fixtures, fittings, plant and
machinery which the relevant Port Owner has in Clause 13.2 covenanted
to insure in each case in accordance with the provisions of Clause 13.2
and the Port Owner shall be liable to the Security Agent for the
expense of the Security Agent in so doing.
13.4 Leasehold property insured by lessor
If the interest of any Port Owner in its Mortgaged Port or any part
thereof is leasehold and the lessor (or any superior lessor) covenants
to insure (or procure the insurance of) the same the relevant Port
Owner shall:-
(A) provide the Security Agent with details of the insurance of
such Port and provide the Security Agent with a copy of the
insurance policies and any subsequent endorsements if such
Port Owner has the right to obtain the same from the landlord
and has so obtained the same;
(B) provide the Security Agent with receipts or other evidence of
the payment of all premiums under such policies of insurance
if such Port Owner has the right to obtain the same from the
landlord and has so obtained the same;
(C) insure separately (in accordance with the provisions of Clause
13.2) against such risks as are referred to in Clause 13.2 for
additional sums required by the Security Agent (or failing
such requirement in accordance with the practice in respect of
assets of the same type from time to time current amongst
prudent businessmen) not insured by the lessor but only to the
extent that such Port Owner is not prohibited from doing so
under the terms of the relevant lease; and
(D) take all steps open to it to enforce the insurance and (unless
the Security Agent
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agrees otherwise) reinstatement covenants on the part of the
lessors and any superior lessors. The Security Agent shall
not unreasonably withhold its approval to a request from the
relevant Port Owner that it terminate the relevant lease in
lieu of enforcing the reinstatement covenants therein if, in
the reasonable opinion of such Port Owner, it would be
commercially advantageous to it to do so.
13.5 Notification and settlement of insurance claims
The relevant Port Owner shall as soon as possible give notice to the
Security Agent of all claims in respect of its Mortgaged Port made
under each policy of insurance referred to in Clause 13.2 and 13.4
estimated to be in excess of $2,000,000 (or the equivalent in any other
currency) and of all facts and matters relating to such claims. Subject
to complying with its obligations to any lessor or tenant under any
existing lease, the relevant Port Owner shall not agree to the
settlement of any such claim without the prior written consent of the
Security Agent.
13.6 Application of insurance proceeds
Subject to the obligations of the relevant Port Owner to any tenant in
respect thereof, all sums at any time payable under any policies of
insurance relating to its Mortgaged Port shall be paid to the Security
Agent and shall be applied in making good or recouping expenditure in
respect of the loss or damage for which such moneys are received or as
the Security Agent may otherwise require (and if the same is not paid
directly to the Security Agent by the insurers then the relevant Port
Owner shall hold the same on trust for the benefit of the Security
Agent and shall account to the Security Agent accordingly) provided
however that until the Security Agent otherwise requires by notice in
writing to the relevant Port Owner, such Port Owner will not be
required so to pay to the Security Agent any such sums in respect of
any claim for $2,000,000 (or the equivalent in any other currency) or
less.
13.7 Repair
Each Port Owner shall keep its Mortgaged Port in good and substantial
repair and condition and (when necessary) replace all such buildings,
fixtures, fittings, plant and machinery thereon as are in each case
used or required in the ordinary course of the Stena AB Group's
business but not where the relevant Port Owner reasonably considers
that repair or replacement is not necessary or desirable to enable it
efficiently to carry on its business.
13.8 Security Agent's right to remedy breach of repair covenants
If a Port Owner fails to comply with any of its obligations under
Clause 13.7 in respect of its Mortgaged Port (whether or not the Port
Mortgage relating thereto shall have become enforceable) the Security
Agent may, but without being under any duty to do so, itself repair any
such buildings, fixtures, fittings, plant and machinery which the
relevant Port Owner has in Clause 13.7 covenanted to repair (and for
such purpose the Security Agent may enter upon the Mortgaged Port or
any part thereof without being deemed to have gone into possession
thereof).
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13.9 Maintenance
None of the Port Owners will, without the prior written consent of the
Security Agent (such consent not to be unreasonably withheld), pull
down or remove the whole or any part of any buildings on its Mortgaged
Port or sever or unfix or remove any of the fixtures thereon or (except
for the purpose of effecting necessary repairs thereto or of replacing
the same with new or improved models or substitutes) remove any of the
plant and machinery forming part of such Mortgaged Port except where:-
(A) it is required to do so pursuant to any mandatory local
authority or other requirement;
(B) the effect of doing so will not materially reduce the value of
such Mortgaged Port;
(C) if there is a material reduction in the value of such
Mortgaged Port following the removal of any plant or machinery
therefrom, such plant or machinery is removed to another
Mortgaged Port which is subject to a Port Mortgage in favour
of the Security Agent and there is an increase in the value of
that Mortgaged Port commensurate with the decrease in value of
the first Mortgaged Port; or
(D) the relevant building, fixture, plant or machinery is disposed
of in accordance with Clause 5.3.
13.10 Notification of planning authority notices, etc.
Each of the Port Owners will, within seven (7) days after becoming
aware thereof, give to the Security Agent a copy of any notice, order,
direction, designation, resolution or proposal having specific
application to its Mortgaged Port or any part thereof or to the
locality in which the same is situate given or made by any planning
authority or other public body or authority whatsoever the compliance
with which is likely to have a material adverse effect on the value of
the Mortgaged Port concerned and (if the Security Agent so requires or
if such Port Owner is obliged by law to do so and so decides) that it
will forthwith and at the cost of such Port Owner take all reasonable
and necessary steps to comply with any such notice, order, direction,
designation or resolution and make or join with the Security Agent in
making such objections or representations in respect of any such
proposal as the Security Agent may require.
13.11 Performance of covenants
Each of the Port Owners will:-
(A) observe and perform all material covenants, stipulations and
conditions to which its Mortgaged Port or any part thereof or
the user thereof is now or may hereafter be subjected so far
as the same are still subsisting and capable of being enforced
and of which such Port Owner receives written notice that it
is in breach thereof from the person entitled to enforce the
same (including all material covenants and obligations of such
Port Owner as lessor);
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(B) (without prejudice to the generality of the foregoing) as
regards any lease under which all or any part of its Mortgaged
Port is held, duly and punctually pay all rents due or to
become due thereunder and perform and observe all the material
covenants and conditions on the part of the tenant which are
therein contained; and
(C) notify the Security Agent of any material claim, notice or
proceedings in respect of any (alleged) breach of any of the
foregoing.
13.12 Restriction on licences, tenancies and leases
Except with the prior written consent of the Security Agent (which
consent shall not be unreasonably withheld and which shall not be
withheld at all where the relevant Port Owner is contractually obliged
to any existing lessor or tenant to perform the act for which the
Security Agent's consent is required), no Port Owner shall grant or
agree to grant or vary or agree to vary any licence or tenancy
affecting all or any part of its Mortgaged Port nor exercise the powers
of leasing or agreeing to lease or of accepting or agreeing to accept
surrenders conferred by Sections 99 and 100 of the Law of Property ▇▇▇
▇▇▇▇ nor in any other way dispose or agree to dispose of or create any
legal or equitable estate or interest in or otherwise part with or
share possession or occupation of its Mortgaged Port or any part
thereof to or with any person (other than another member of the Stena
AB Group) where this would materially and adversely affect the value of
the Port or the profitability of the business carried out thereat.
It is agreed for the purpose of this Clause 13.12 that there will be no
material and adverse effect on the value of a Mortgaged Port or the
profitability of any business carried out thereat where:-
(A) the relevant Port Owner grants a lease or licence of any part
of the Port for a term not exceeding twenty five (25) years on
proper commercial terms with rents to be reviewed at
reasonable intervals of not more than five (5) years if
appropriate and at either:-
(i) the best rent reasonably obtainable in the open
market without taking a fine or premium or other
capital consideration; or
(ii) at a lower rent where the relevant Port Owner is
satisfied that it is in the best commercial interests
of the business carried on at the Port that the lease
or licence should be granted; and
(B) in any case where the term of any lease is for not more than
five (5) years the letting excludes the provisions of
Sections 24 to 28 of the Landlord and ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
and such lease or licence would have no material adverse effect on the
use of the Port for the purpose of any undertaking carried on at the
Port.
13.13 Land Registration Acts 1925 to 1986
Each of the Port Owners shall procure that no person shall be
registered under the Land Registration Acts 1925 to 1986 as proprietor
of its Mortgaged Port or any part
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thereof who is not now or when the same is acquired by the relevant
Port Owner so registered without the prior written consent of the
Security Agent (provided always that this restriction shall not apply
to any lease granted pursuant to Clause 13.12) and the relevant Port
Owner shall be liable for the costs incurred by the Security Agent in
lodging from time to time cautions against the first registration of
title at H.M. Land Registry to its Mortgaged Port.
13.14 Restriction on development
Each of the Port Owners undertakes in respect of its Mortgaged Port
that, where this would materially and adversely affect the value of its
Mortgaged Port, it will not without the prior written consent of the
Security Agent:-
(A) carry out or permit or suffer to be carried out any
development (as defined in the Planning Acts) on such
Mortgaged Port or any part thereof; or
(B) materially change or permit or suffer to be materially changed
the user of the such Mortgaged Port or any part thereof.
13.15 Compliance with Planning Acts
None of the Port Owners will do or omit or permit or suffer to be done
or omitted any act, matter or thing in, on or respecting its Mortgaged
Port or any part thereof which is required to be omitted or done by the
Planning Acts or any other Acts or statutory provisions whatever or
which shall contravene the provisions of such Acts or any of them and
each Port Owner will at all times indemnify and keep indemnified the
Security Agent against all actions, proceedings, costs, expenses,
claims and demands whatsoever in respect of any such matter or thing
contravening the provisions of the said Acts or any of them as
aforesaid.
13.16 Payment of outgoings
Each of the Port Owners will pay, and indemnify the Banks against, all
claims in respect of rates, taxes, duties, charges, assessments and
outgoings assessed or charged upon its Mortgaged Port or payable by the
owner or occupier.
13.17 Inspection
Each of the Port Owners undertakes in respect of its Mortgaged Port
that it will permit the Security Agent and any duly authorised agent,
architect or surveyor of the Security Agent to have access to such Port
or any part thereof at all reasonable times (but so as not to interfere
with the ordinary conduct of business at such Port) upon prior
appointment for the purpose of inspecting the same.
14. CONDITIONS
14.1 Documents and evidence
The obligation of each Bank to make its Commitment available shall be
subject to the condition that the Agent, or its duly authorised
representative, shall have received all the documents and evidence
specified in Schedule 5 in form and substance satisfactory to the
Agent.
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14.2 General conditions precedent
The obligation of each Bank to make its Commitment available shall be
subject to the further conditions that, as at the Availability Date:-
(A) the representations and warranties contained in Clauses 9.1
and 9.2 are true and correct on and as of the Availability
Date as if each was made with respect to the facts and
circumstances existing at such time;
(B) no Default shall have occurred and be continuing or would
result from the making of an Advance on the Availability Date;
and
(C) no material adverse change has occurred in the business,
financial condition or prospects of the Stena AB Group or the
Stena International Group as a whole from that shown in the
information memorandum dated June 2001 prepared by ▇. ▇.
▇▇▇▇▇▇ plc and received by the Banks.
14.3 Waiver of conditions precedent
The conditions specified in this Clause 14 are inserted solely for the
benefit of the Banks and may be waived on their behalf in whole or in
part and with or without conditions by the Agent acting on the
instruction of the Banks without prejudicing the right of the Agent
acting on such instructions to require fulfilment of such conditions in
whole or in part in respect of any other Advance.
14.4 Notification to Banks
The Agent shall notify the Banks promptly after receipt by it of the
documents and evidence referred to in Clause 14.1 in form and substance
satisfactory to it.
15. DEFAULT
15.1 Events of default
Each of the events set out below is an Event of Default:-
(A) Non-payment
any Security Party does not pay within three (3) Banking Days
of the due date any amount payable by it under any Security
Document at the place and in the currency in which it is
expressed to be payable or, in the case of amounts due on
demand, within seven (7) Banking Days of receipt of the
relevant demand;
(B) Breach of other obligations
any Security Party fails to comply with any other provision of
any Security Document in a material respect and (unless in the
reasonable opinion of the Agent incapable of remedy) such
action as the Agent may require shall not have been taken
within a period of twenty one (21) days of the Agent notifying
the relevant Security Party of such default and of such
required action or within two (2) Banking Days of such
notification in relation to any
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breach of any insurance covenant leading to a possible
avoidance of insurance cover;
(C) Misrepresentation
any representation or warranty made or repeated by any
Security Party in any Security Document or in any certificate,
statement or opinion delivered by or on behalf of any Security
Party thereunder or in connection therewith is incorrect in a
material respect when made or repeated and (unless in the
reasonable opinion of the Agent incapable of remedy) action
has not been taken by the relevant Security Party to ensure
that such representation or warranty is rendered correct
within twenty one (21) days of the Agent notifying the
relevant Security Party;
(D) Cross-acceleration
at any time the aggregate amount at such time of:-
(i) the amount of any Debt of the Security Parties which
is not paid when due or within any originally
applicable grace period relating thereto and remains
unpaid or which has been declared due and payable
prior to the date when it would otherwise have become
due (unless as a result of the exercise by the
relevant person of a voluntary right of prepayment or
upon mandatory prepayment as a result of a change of
law or other circumstances not constituting an event
of default under, or breach of, any agreement
regulating and/or securing the relevant Debt) and
such declaration has not been cancelled or withdrawn;
and
(ii) any amounts demanded of, but not paid when due and
remaining unpaid by, the Security Parties under any
guarantee in respect of Debt (other than Debt
referred to in sub-paragraph (i) of this paragraph)
exceeds $15,000,000;
(E) Winding-up
any order is made or resolution passed or other action taken
without the prior written consent of the Majority Banks for
the suspension of payments or resulting in the dissolution,
termination of existence, liquidation, winding-up or
bankruptcy of any Security Party, unless in each case such
proceeding is revoked within fourteen (14) days of such order
being made, resolution passed or action taken;
(F) Moratorium or arrangement with creditors
a moratorium in respect of all or a significant part of the
debts of any Security Party, or a composition or an
arrangement with creditors of any Security Party or any
similar proceeding or arrangement by which the assets of any
Security Party are submitted to the control of its creditors,
is applied for, ordered or declared;
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(G) Appointment of liquidators etc.
a liquidator, trustee, administrator, receiver, manager or
similar officer is appointed in respect of any Security Party
or in respect of all or any substantial part of the respective
assets of any Security Party;
(H) Insolvency
any Security Party becomes or is declared insolvent or
suspends payment or is unable, or admits in writing its
inability, to pay its debts as they fall due or becomes
insolvent within the terms of any applicable law;
(I) Legal process
any distress, execution, attachment or other process is levied
against the whole or any substantial part of the assets of any
Security Party and remains undischarged for a period of thirty
(30) days (except in the case of a Vessel);
(J) Analogous events
anything analogous to or having a substantially similar effect
to any of the events specified in sub-Clauses (E) to (I) of
this Clause 15.1 shall occur in relation to a Security Party
under the laws of any applicable jurisdiction;
(K) Unlawfulness
at any time it becomes unlawful or impossible for any Security
Party to perform any of its material obligations under any
Security Document to which it is a party or it is unlawful or
impossible for the Agent, the Security Agent or any of the
Banks to exercise any of their respective material rights
under any of the Security Documents and (unless in the
reasonable opinion of the Agent any such impossibility or
unlawfulness is incapable of rectification or remedy) the
relevant Security Party (with due co-operation from the Agent,
the Security Agent and the Banks) shall have failed to procure
within twenty eight (28) days of notice from the Agent to do
so that the foregoing is no longer impossible or unlawful;
(L) Material adverse change; material adverse litigation
either:-
(i) any material adverse change in the consolidated
financial condition of the Stena AB Group as a whole
from that set forth in the Audited Stena AB Financial
Statements as at 31 December 2000 occurs the effect
of which is materially to imperil, delay or prevent
the due fulfilment by any Security Party of all or
any of their material payment obligations under any
Security Documents; or
(ii) any final and conclusive judgment, order or award is
made by any court, arbitration board or other
tribunal against any member of the Stena AB Group the
effect of complying with which will materially
imperil, delay or prevent the due fulfilment by any
Security Party of all
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or any of their material payment obligations under
any Security Documents
and in either such case such circumstances continue unremedied for a
period of one hundred and twenty (120) days after notification from the
Agent to the Borrower requiring the same to be remedied provided that
such one hundred and twenty (120) day remedy period shall only be taken
into account if the Agent certifies to the Borrower that such
circumstances are in the opinion of the Majority Banks capable of
remedy and the Borrower demonstrates to the satisfaction of the Agent
that reasonable steps are being taken which are likely to lead to such
circumstances being remedied within such one hundred and twenty (120)
day period.
For the purposes of the foregoing, the Borrower or Stena AB shall be
deemed to have failed to perform or comply with any covenant contained
in this Agreement or the other Security Documents requiring the
Borrower or Stena AB to cause certain actions to be taken (or to
prohibit the taking of certain actions) by any Subsidiary of the
Borrower or Stena AB if such Subsidiary shall have taken (or failed to
take) such actions, even where the Borrower or Stena AB lacks the
corporate power and authority under Book 2 of the Netherlands Civil
Code or the Swedish Companies Act (1975:1385) respectively to cause or
prohibit such actions.
15.2 Termination
The Agent if so requested by the Majority Banks shall, without
prejudice to any other rights of the Agent, the Security Agent, the
Co-Arrangers and the Banks, at any time after the happening of an Event
of Default by notice to the Borrower:-
(A) declare that the obligation of each Bank to make its
Commitment available shall be terminated, whereupon the
Commitments shall be reduced to zero forthwith; and/or
(B) declare that all outstanding Advances and all interest and
commitment commission accrued and all other sums payable under
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.
15.3 Demand basis
If, pursuant to Clause 15.2(B) the Agent declares all outstanding
Advances to be due and payable on demand, the Agent may (and, if so
instructed by the Majority Banks, shall) by written notice to the
Borrower (i) call for repayment of the Advances on such date as may be
specified whereupon the Advances shall become due and payable on the
date so specified together with all interest and any commitment
commission accrued and all other sums payable under this Agreement or
(ii) withdraw such declaration with effect from the date specified in
such notice.
16. INDEMNITIES
16.1 Miscellaneous indemnities
The Borrower shall on demand indemnify each Bank, the Co-Arrangers, the
Security Agent and the Agent, without prejudice to any of their other
rights under any of the
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Security Documents, against any loss or expense which such Bank, the
Co-Arrangers, the Security Agent or the Agent shall certify as
sustained or incurred by it as a consequence of:-
(A) any default in payment by the Borrower of any sum under any of
the Security Documents when due; or
(B) the occurrence of any other Event of Default; or
(C) as a consequence of or arising in any way whatsoever in
connection with the performance of its obligations hereunder;
or
(D) receiving or recovering all or any part of a sum unpaid
otherwise than on the due date for the payment of interest
in respect thereof; or
(E) any prepayment of any Advance or part thereof being made under
Clauses 5.3, 5.6, 5.7, 5.8, 5.9, 5.10 or 17.1, or any other
repayment of any Advance or part thereof, being made otherwise
than on its Maturity Date or due date for repayment; or
(F) any Advance not being made for any reason (excluding any
default by the Agent, the Co-Arrangers, the Security Agent or
any Bank) after a Drawdown Notice or request for drawing has
been given
including, in any such case, but not limited to, any loss or expense
sustained or incurred by any Bank, the Security Agent or the Agent in
maintaining or funding its Contribution or any part thereof or its
portion of any other sum to be paid by it hereunder or in liquidating
or re-employing deposits from third parties acquired or contracted for
to fund, effect or maintain its Contribution or any part thereof or any
other amount owing to the such Bank, the Security Agent or the Agent.
16.2 Currency indemnity
If any sum due from the Borrower or Stena AB under any of the Security
Documents or any order or judgment given or made in relation thereto
has to be converted from the currency (the "FIRST CURRENCY") in which
the same is payable under 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
or Stena AB, (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 any of the Security Documents, the Borrower and Stena AB
shall indemnify and hold harmless the Agent, the Co-Arrangers, the
Security Agent and each Bank 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
Agent, the Co-Arrangers, the Security Agent or any Bank 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 or Stena AB under this Clause 16.2 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 any of the Security Documents
and the term "RATE OF
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EXCHANGE" includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency.
16.3 Waiver
If and insofar as the Borrower has a right to invoke the nullity of any
indemnity granted by it in this Agreement on the basis of Article 2.7
Netherlands Civil Code, it hereby explicitly waives its right to invoke
such nullity on the basis of Article 2.7 Netherlands Civil Code.
17. UNLAWFULNESS AND INCREASED COSTS
17.1 Unlawfulness
If at any time after the date of this Agreement the introduction,
imposition, variation or change of any law, regulation or regulatory
requirement or any judgment, order or direction of any court, tribunal
or authority binding upon a Bank in the jurisdiction in which it is
formed or has its principal office or the office identified against its
name in this Agreement (or in any Transfer Certificate, in the case of
a Transferee Bank) or in which any action is required to be performed
by it for the purposes of this Agreement (whether or not in force
before the date of this Agreement) causes any Bank to believe that it
has become unlawful for it to contribute to the Advances or to fund its
Contribution then that Bank shall promptly inform the Agent and the
Agent shall notify the Borrower whereupon:-
(A) the relevant Bank (the "AFFECTED PARTY") shall, following
consultation with the Borrower, use all reasonable efforts to
avoid the effects of such introduction, imposition, variation
or change and in particular shall consider, subject to
obtaining any necessary consents, transferring at par its
rights and obligations under this Agreement to another legal
entity approved by the Borrower not affected by such law;
(B) if the Affected Party is unable, within ninety (90) days
following the date upon which the Affected Party became
aware of any such introduction, imposition, variation or
change, or such shorter period permitted thereby, to avoid
the effect thereof, or the Borrower fails to agree to any
proposal put forward by the Affected Party to avoid the
effects of such introduction, imposition variation or
change, then the Agent shall, at the request and on behalf
of the Affected Party, give notice to the Borrower that on
such date or on a future specified date, in either case not
being earlier than the latest date permitted by such
introduction, imposition, variation or change, the Affected
Party's Commitment shall be reduced to zero and the Borrower
shall be obliged to prepay the Contribution of such Bank
either (a) forthwith or (b) on a future specified date not
being earlier than the latest date permitted by the relevant
law or regulation;.
17.2 Increased costs
If the result of any change in, or in the interpretation or application
of, any law or regulation (including, without limitation, those
relating to Taxation, capital adequacy, liquidity, reserve assets and
special deposits) after the date of this Agreement is to:-
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(A) subject any Bank to Taxes or change the basis of Taxation of
any Bank with respect to any payment under any of the Security
Documents (other than Taxes or Taxation on the overall net
income, profits or gains of such Bank imposed in the
jurisdiction in which its principal or lending office under
this Agreement is located); and/or
(B) increase the cost to, or impose an additional cost on, any
Bank in making or keeping its Commitment available or
maintaining or funding its Contribution or otherwise in
maintaining its obligations under this Agreement; and/or
(C) reduce the amount payable or the effective return to any Bank
under any of the Security Documents; and/or
(D) reduce any Bank's rate of return on its capital by reason of a
change in the manner in which it is required to allocate
capital resources to its obligations under any of the Security
Documents; and/or
(E) require any Bank to make a payment or forgo a return on or
calculated by reference to any amount received or receivable
by it under any of the Security Documents,
then and in each such case (but subject to Clause 17.3):-
(i) such Bank shall notify the Borrower in writing of
such event promptly upon its becoming aware of the
same specifying reasonable details of the relevant
event and of any increased cost, reduction in any
rate of return or liability and its method of
calculation and attribution to its obligations under
this Agreement; and
(ii) the Borrower shall on demand, made at any time
whether or not the relevant Bank's Contribution has
been repaid, pay to the Agent for the account of such
Bank the amount which such Bank specifies (in a
certificate setting forth the basis of the
computation of such amount in reasonable detail but
not including any matters which such Bank regards as
confidential in relation to its funding arrangements)
is required to compensate such Bank for such
increased cost, reduction, payment or forgone return.
17.3 Exception
Nothing in Clause 17.2 shall entitle any Bank to compensation for any
such increased costs, reduction, payment or foregoing return to the
extent that the same is the subject of an additional payment under
Clause 7.7.
17.4 Mitigation
If circumstances arise which would, or would upon the giving of notice,
result in:-
(A) the Borrower being required to make an increased payment to a
Bank pursuant to Clause 7.7;
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(B) the reduction of the Commitment of a Bank to zero or the
Borrower being required to prepay the Contribution of a Bank
pursuant to Clause 17.1; or
(C) the Borrower being required to make a payment to a Bank to
compensate such Bank for an increased cost, reduction, payment
or forgone return pursuant to Clause 17.2
then, without in any way limiting, reducing or otherwise qualifying the
obligations of the Borrower under Clauses 7.7 and 17, the relevant
Bank, Co-Arranger, Agent or Security Agent (as the case may be) shall
endeavour to take such reasonable steps as may be open to it to
mitigate or remove such circumstances including (without limitation)
the transfer of its rights and obligations under this Agreement to
another bank or financial institution acceptable to the Borrower unless
to do so might (in its opinion) be prejudicial to it or be in conflict
with its general banking policies or involve it in expense or an
unreasonable increased administrative burden.
18. SET-OFF AND PRO-RATA PAYMENTS
18.1 Set-off
The Borrower and Stena AB each authorise each Bank (without prejudice
to any such Bank's rights at law, in equity or otherwise), at any time
when an Event of Default has occurred and is continuing and without
notice to the Borrower or Stena AB:-
(A) to apply any credit balance to which the Borrower or Stena AB
is then entitled standing upon any account of the Borrower or
Stena AB with any branch of such Bank in or towards
satisfaction of any sum due and payable from the Borrower or
Stena AB to such Bank under any of the Security Documents;
(B) in the name of the Borrower and/or Stena AB and/or such Bank
to do all such acts and to 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 and/or Stena AB with such Bank.
For such purposes, each Bank is authorised to purchase with the moneys
standing to the credit of such account such other currencies as may be
necessary to effect such application. No Bank shall be obliged to
exercise any right given to it by this Clause 18.1. Each Bank shall
notify the Agent and the Borrower forthwith upon the exercise or
purported exercise of any right of set-off giving full details in
relation thereto and the Agent shall inform the other Banks.
18.2 Pro rata payments
(A) If at any time any Bank, (the "RECOVERING BANK") receives or
recovers any amount owing to it by the Borrower or Stena AB
under this Agreement by direct payment, set-off or in any
manner other than by payment through the Agent pursuant to
Clause 7.1 or 7.10 (not being a payment received from an
assignee, a Transferee Bank or a sub-participant in such
Bank's Contribution or any other payment of an amount due to
the Recovering Bank for its sole account pursuant to Clauses
4.5, 6, 7.7, 16.1, 16.2, 17.1 or 17.2) the
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Recovering Bank shall, within two Banking Days of such
receipt or recovery (a "RELEVANT RECEIPT") notify the Agent
of the amount of the Relevant Receipt. If the Relevant
Receipt exceeds the amount which the Recovering Bank would
have received if the Relevant Receipt had been received by
the Agent and distributed pursuant to Clause 7.1 or 7.10 as
the case may be then:-
(i) within two Banking Days of demand by the Agent, the
Recovering Bank shall pay to the Agent an amount
equal (or equivalent) to the excess;
(ii) the Agent shall treat the excess amount so paid by
the Recovering Bank as if it were a payment made by
the Borrower and shall distribute the same to the
Banks (other than the Recovering Bank) in accordance
with Clause 7.10; and
(iii) as between the Borrower or, as the case may be, Stena
AB, and the Recovering Bank the excess amount so
re-distributed shall be treated as not having been
paid but the obligations of the Borrower and Stena AB
to the other Banks shall, to the extent of the amount
so re-distributed to them, be treated as discharged.
(B) If any part of the Relevant Receipt subsequently has to be
wholly or partly refunded by the Recovering Bank (whether to a
liquidator or otherwise) each Bank to which any part of such
Relevant Receipt was so re-distributed shall on request from
the Recovering Bank repay to the Recovering Bank such Bank's
pro rata share of the amount which has to be refunded by the
Recovering Bank.
(C) Each Bank shall on request supply to the Agent such
information as the Agent may from time to time request for the
purpose of this Clause 18.2.
(D) Notwithstanding the foregoing provisions of this Clause 18.2
no Recovering Bank shall be obliged to share any Relevant
Receipt which it receives or recovers pursuant to legal
proceedings taken by it to recover any sums owing to it under
this Agreement with any other party which has a legal right
to, but does not, either join in such proceedings or commence
and diligently pursue separate proceedings to enforce its
rights in the same or another court (unless the proceedings
instituted by the Recovering Bank are instituted by it without
prior notice having been given to such party through the
Agent).
18.3 No release
For the avoidance of doubt it is hereby declared that failure by any
Recovering Bank to comply with the provisions of Clause 18.2 shall not
release any other Recovering Bank from any of its obligations or
liabilities under Clause 18.2.
18.4 No charge
The provisions of this Clause 18 shall not, and shall not be construed
so as to, constitute a charge by a Bank over all or any part of a sum
received or recovered by it in the circumstances mentioned in Clause
18.2.
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18.5 Partial realisation of security
If, by reason of the transfer or purported transfer by any Bank of all
or any of its rights, title and interest hereunder by means of a
Transfer Certificate or otherwise, the indebtedness of the Borrower to
any successor in title, assignee or transferee (including a Transferee)
of such Bank constitutes, or is deemed to constitute, at the time of
such transfer or purported transfer by operation of law or otherwise
indebtedness ("NEW INDEBTEDNESS") separate and distinct from the
indebtedness ("ORIGINAL INDEBTEDNESS") owed by the Borrower to the
other Banks (including the Bank making the transfer insofar as it does
not transfer all of its rights, title and interest hereunder) and if
the New Indebtedness is not secured by any particular Security Document
or, if so secured, if such security ranks in priority after the
security constituted thereby in respect of the Original Indebtedness,
the proceeds of realisation of that particular Security Document
received by the Agent from the Security Agent shall be applied by the
Agent:-
(A) insofar as the proceeds of realisation relate to the Original
Indebtedness, in distribution thereof between the Banks to
whom the Original Indebtedness is owed pro rata to their
respective contributions to the Original Indebtedness; and
(B) insofar as the proceeds of realisation relate to the New
Indebtedness, in distribution thereof to the relevant
successors in title, assignees or transferees (including any
Transferees) in respect of the Bank making the transfer (being
the persons to whom the New Indebtedness is owed) pro rata to
their respective contributions to the New Indebtedness.
19. SECURITY
19.1 Continuing security
The security created under the Security Documents is a continuing
security and shall remain in full force and effect until all moneys,
obligations and liabilities from time to time due, owing or incurred by
the Borrower under the Security Documents shall have been paid or
satisfied in full, and is in addition to and not in substitution for,
and shall not be prejudiced or affected by, any other security or
guarantee from time to time held by the Agent, the Security Agent, the
Co-Arrangers or any Bank for the payment or satisfaction of such
moneys, obligations or liabilities.
19.2 Amendments
The liability of the Borrower and Stena AB under the Security Documents
shall not be lessened or impaired by (i) any time, indulgence or relief
being given by Agent, the Security Agent, the Co-Arrangers or any Bank
to any other person liable, (ii) the taking, variation, compromise,
renewal or release of or refusal or neglect to perfect or enforce any
rights, remedies or securities against any other person liable, (iii)
any legal limitation, disability, incapacity or other circumstances
relating to any other person liable, whether or not known to the Agent,
the Security Agent, the Co-Arrangers or any Bank, (iv) any invalidity
in or irregularity or unenforceability of the obligations of any other
person liable or (v) anything done or omitted which but for
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this provision might constitute a legal or equitable discharge or
defence of the Borrower or Stena AB.
19.3 Waiver by Borrower and Stena AB
The Borrower and Stena AB hereby waive all rights they may have of
first requiring the Agent, the Security Agent, any Bank or the
Co-Arrangers to proceed against or enforce any guarantee or security
of, or claim payment from, the Borrower or Stena AB or any other person
liable to make any claim or file any proof in the bankruptcy,
insolvency or liquidation of the Borrower or Stena AB or any other
person liable.
19.4 Settlement or discharge
Any settlement or discharge between the Agent, the Security Agent, any
Bank or the Co-Arrangers and the Borrower and/or Stena AB shall be
conditional upon no security or payment to the Agent, the Security
Agent, any Bank or the Co-Arrangers by the Borrower or any other person
being avoided or set aside or ordered to be refunded or reduced by
virtue of any provision or enactment relating to bankruptcy, insolvency
or liquidation for the time being in force and the Agent, the Security
Agent, any Bank and the Co-Arrangers shall be entitled to recover from
the Borrower and/or Stena AB the value which the Agent, the Security
Agent, such Bank or the Co-Arrangers have placed upon such security or
the amount of any such payment as if such settlement or discharge has
not occurred.
19.5 Reflagging
(A) Reflagging Notice
At any time and from time to time during the Security Period
provided that no Event of Default has occurred and is
continuing, the Borrower may give a notice (a "REFLAGGING
NOTICE") to the Agent that the Shipowner of a Mortgaged Ship
or Mortgaged Linkspan wishes:-
(i) to transfer the port of registry of such Ship or
Linkspan from one port of registry (the "EXISTING
PORT OF REGISTRY") in the Ship's or Linkspan's Flag
State to another port of registry (a "NEW PORT OF
REGISTRY") in such Flag State (a "TRANSFER OF PORT OF
REGISTRY"); or
(ii) to redocument and reregister such Ship or Linkspan
under the laws of any jurisdiction (the "NEW FLAG
STATE") other than its existing Flag State (the
"EXISTING FLAG STATE") (a "TRANSFER OF FLAG"); or
(iii) to transfer ownership of such Ship or Linkspan to the
sole ownership of another member of the Stena AB
Group (the "NEW Owner") (a "TRANSFER OF OWNERSHIP");
or
(iv) to suspend the use of the flag of such Ship's or
Linkspan's Flag State (the "PRIMARY FLAG STATE")
while such Ship or Linkspan is on bareboat charter
and where it is proposed that, for the duration of
such bareboat charter, such Ship or Linkspan will fly
the flag of another jurisdiction (the "SECONDARY FLAG
STATE") selected by such charterer (a "DUAL
REGISTRATION").
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(B) Contents of Reflagging Notice
Any Reflagging Notice delivered by the Borrower to the Agent
shall contain the following particulars:-
(i) the name of the Mortgaged Ship or Mortgaged Linkspan
which is the subject of such Reflagging Notice;
(ii) the name of the relevant Shipowner;
(iii) in the case of a Transfer of Port of Registry, the
proposed New Port of Registry;
(iv) in the case of a Transfer of Flag, the proposed New
Flag State;
(v) in the case of a Transfer of Ownership, the full
name, place of incorporation and principal place of
business of the proposed New Owner;
(vi) if applicable, any proposed new name of such Ship or
Linkspan on a Transfer of Port of Registry, Transfer
of Flag, Transfer of Ownership and/or Dual
Registration;
(vii) in the case of a Transfer of Ownership taking place
in conjunction with a Transfer of Port of Registry
and/or a Transfer of Flag, details of the name of the
proposed New Flag State and (if applicable) proposed
New Port of Registry of the Ship or Linkspan upon
completion of the Transfer of Ownership; and
(viii) in the case of a Dual Registration, details of the
Secondary Flag State, the bareboat charter and the
charterer.
(C) Release of Security Documents on Transfer of Flag and/or
Transfer of Ownership
Subject to fulfilment of the conditions specified in Clause
19.5(F), the Agent shall instruct the Security Agent to, and
the Security Agent shall, duly release and discharge the Ship
Mortgage in respect of the relevant Mortgaged Ship or (as the
case may be) the Linkspan Mortgage in respect of the relevant
Mortgaged Linkspan, and release and re-assign the Deed of
Covenant or Insurance Assignment and, if so requested by the
Borrower, any Charterer's Insurance Assignment executed in
respect of such Ship or Linkspan by a Stena Charterer upon
reasonable notice from the Borrower to enable the Transfer of
Flag of such Ship or Linkspan and/or the Transfer of Ownership
of such Ship or Linkspan.
(D) Consent to Transfer of Port of Registry
The Agent shall give instructions to the Security Agent to,
and the Security Agent shall, give any requisite consents
required by any applicable ship registrar or other official to
enable a Mortgaged Ship or Mortgaged Linkspan to be
transferred from its Existing Port of Registry to the New Port
of Registry
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provided that the Ship Mortgage over such Ship or (as the
case may be) the Linkspan Mortgage over such Linkspan will
continue to be registered against such Ship or Linkspan at
the New Port of Registry or in any applicable central
register of ship mortgages in the Flag State.
(E) Consent to Dual Registration
Subject to fulfilment of the conditions specified in Clause
19.5(G), the Agent shall instruct the Security Agent to, and
the Security Agent shall, give any requisite consents required
by any applicable ship registrar or other official in the
Primary Flag State and/or the Secondary Flag State to permit
the Dual Registration of a Mortgaged Ship or Mortgaged
Linkspan.
(F) Conditions to Transfer of Ownership and/or Transfer of Flag
Upon completion of the Transfer of Ownership and/or Transfer
of Flag, the Borrower shall deliver or procure the delivery to
the Agent of:-
(i) a Shipowner's Guarantee and a Ship Mortgage or (in
the case of a Linkspan) a Linkspan Mortgage together
with a Deed of Covenant (in the case of a Designated
Ship) or an Insurance Assignment (in the case of a
Linkspan or any other Ship) in respect of the
Mortgaged Ship or Mortgaged Linkspan executed by the
relevant Shipowner or (in the case of a Transfer of
Ownership) the New Owner;
(ii) in the case of a Ship or Linkspan managed by another
member of the Stena AB Group, a Manager's
Subordination Undertaking;
(iii) in the case of a Ship or Linkspan let on bareboat
charter to a Stena Charterer, a Charterer's
Subordination Undertaking and a Charterer's Insurance
Assignment;
(iv) a notice of assignment of insurances in relation to
the Ship or Linkspan executed by the New Owner and
any Stena Charterer;
(v) evidence that the Ship or Linkspan has been insured
in accordance with the requirements of the Deed of
Covenant, Insurance Assignment and any Charterer's
Insurance Assignment;
(vi) opinions satisfactory to the Banks in relation to the
registration of the Ship and the Ship Mortgage or (as
the case may be) the Linkspan and the Linkspan
Mortgage, the due execution and authorisation of any
documents executed pursuant to paragraphs (i) to (iv)
above and such other matters as the Banks may
reasonably require in relation to English law and to
the jurisdictions of incorporation of the Shipowner,
any Stena Charterer, any other charterer and the
registry or registries of the Ship or Linkspan;
(vii) evidence that the New Owner of the Ship or Linkspan
has acquired good marketable title to the Ship or
Linkspan and that the Ship or Linkspan is
unencumbered save for the new Ship Mortgage or new
Linkspan Mortgage (as the case may be) and Permitted
Ship Liens;
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(viii) in the case of a Transfer of Flag, evidence that the
New Flag State shall be an Approved Flag State
and the obligations of the Agent and the Security Agent under
Clause 19.5(D) shall be subject to the condition that the
Agent has received all of such documents and evidence.
(G) Conditions to Dual Registration
Upon suspension of the use of the flag of the Primary Flag
State and commencement of the use of the flag of the Secondary
Flag State, the Borrower shall deliver or procure the delivery
to the Agent of the following documents and/or evidence:-
(i) evidence that the Secondary Flag State shall be an
Approved Flag State;
(ii) an opinion satisfactory to the Agent from lawyers
qualified or accustomed to advise on the laws of the
Primary Flag State and the Secondary Flag State that
the Dual Registration is permitted by their
respective laws for the duration of the relevant
charter period or a specified part thereof and that
the Ship Mortgage over the relevant Ship or (as the
case may be) the Linkspan Mortgage over the relevant
Linkspan and the relevant Shipowner's title thereto
remain duly registered under the laws of the Primary
Flag State following the Dual Registration and that
on termination of the charter by virtue of which the
Ship or Linkspan is registered in the Secondary Flag
State or a judicial sale of the Ship or Linkspan the
Dual Registration will be terminated without delay
and without any discretionary consents from
authorities in the Secondary Flag State;
(iii) if the laws of the Secondary Flag State require that
the Ship Mortgage or Linkspan Mortgage be noted or
registered against the Ship or Linkspan (as the case
may be) in the Secondary Flag State, evidence
reasonably satisfactory to the Agent that such
notation or registration will be effected upon or
within an appropriate period following commencement
of the Dual Registration
and the obligations of the Agent and the Security Agent under
Clause 19.5(E) shall be subject to the condition that the
Agent has received all of such documents and evidence.
(H) Combined transactions
Where a combined Transfer of Ownership and/or Transfer of Flag
and/or Dual Registration is proposed, Clauses 19.5(C) and (E)
and Clauses 19.5(F) and (G) shall respectively be read
together.
(I) Approved Flag States
For the purposes of this Agreement, "APPROVED FLAG STATE"
means any of the following:-
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(i) the United Kingdom, Bermuda, the Cayman Islands, any
other British Dependent Territory, the Channel
Islands, the Isle of Man and Hong Kong;
(ii) Sweden and any other Member State of the European
Union or Switzerland;
(iii) Norway (including, without limitation, the Norwegian
International Shipping Register) and any other member
of the European Economic Area;
(iv) United States of America and Canada;
(v) Australia and New Zealand;
(vi) the Bahamas, Cyprus, Greece, Liberia and Panama;
(vii) if the European Union establishes a register of ships
for the European Union as a whole (whether instead
of, in addition to or as an alternative to
registration in a Member State of the European
Union), the European Union shall, in relation to the
registration of a Mortgaged Ship in such register, be
deemed to be an Approved Flag State for the purposes
of this Agreement; and
(viii) any other state approved by the Majority Banks which
approval shall not be unreasonably withheld in the
case of a state in which significant numbers of
vessels owned by entities whose ultimate parent
companies and/or shareholders are resident in North
America or the European Union, European Economic Area
or Switzerland are registered and/or where such state
is proposed as the Secondary Flag State for the
relevant Ship.
(J) Reflagging of Transferred Ships
If the purchaser of a Transferred Ship requests the relevant
Shipowner to consent to a change of the flag state in which a
Transferred Ship is registered, the relevant Shipowner may
agree to such change of flag provided that:-
(i) the requirements of this Clause 19.5 are satisfied in
relation to the Ship;
(ii) the Agent has received evidence satisfactory to it
that the Ship is insured in accordance with the terms
of the Commercial Documents;
(iii) the Agent is satisfied that the obligation of the
purchaser of the Transferred Ship is effectively
secured by an assignment in favour of the Security
Agent of a first priority mortgage over the Ship and
first priority assignment in favour of the Security
Agent of the purchaser's interest in the insurances
of the Ship in the event of a Total Loss.
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19.6 Release of security
Provided that no declaration has been made by the Agent under Clause
15.2 the Agent shall instruct the Security Agent to, and the Security
Agent shall, release and discharge the Ship Mortgage and the Deed of
Covenants or Insurance Assignment in respect of any Mortgaged Ship
which is sold by the relevant Shipowner (whether on Credit Terms or
otherwise) on terms that ownership of the relevant Mortgaged Ship
passes from the relevant Shipowner as and when ownership of the
relevant Ship is to pass to the relevant purchaser, in exchange for the
purchase price, or relevant portion thereof, payable to the Shipowner
by the relevant purchaser upon transfer of title to such purchaser (to
be applied in accordance with the provisions of this Agreement and the
other Security Documents) and provided that (in the case of a sale on
Credit Terms) the relevant Shipowner has executed a Receivables
Assignment in relation to the sale of such Ship in accordance with the
provisions of this Agreement.
20. ASSIGNMENT, TRANSFER AND LENDING OFFICE
20.1 Benefit and burden
This Agreement shall be binding upon, and enure for the benefit of,
each of the Banks, the Agent, the Co-Arrangers, the Security Agent, the
Borrower, Stena AB and their respective successors.
20.2 No assignment by Borrower
Neither of the Borrower nor Stena AB may assign or transfer any of
their rights or obligations under any of the Security Documents.
20.3 Transfers
Any Bank (the "TRANSFEROR BANK") may at any time cause all or any part
of its rights, benefits and/or obligations under this Agreement and the
Security Documents to be transferred to its Subsidiaries, affiliates or
associates or to a federal reserve bank, central bank or other monetary
or regulatory authority having jurisdiction over such Bank without the
consent of the Borrower or the Agent or, with the consent of the
Borrower and the Agent (such consents not to be unreasonably withheld
and for this purpose it shall be deemed reasonable to withhold consent
on the grounds that the number of Banks would thereby exceed fifteen
(15) or that the Commitment of any Bank would thereby be less than
three point seven five per cent (3.75%) of the total of the
Commitments), to any other bank or financial institution (a "TRANSFEREE
BANK") by delivering to the Agent a Transfer Certificate duly completed
and duly executed by the Transferor Bank and the Transferee Bank. Any
transfer by a Bank shall be offered and effected in compliance with all
applicable laws and regulations. If the Borrower or the Agent fails to
respond to a request for such consent within ten days of such request
being made, the Borrower or the Agent (as the case may be) shall be
deemed to have given such consent. No such transfer is binding on, or
effective in relation to, the Borrower, the Agent or the Security Agent
unless it is effected or evidenced by a Transfer Certificate which
complies with the provisions of this Clause 20.3 and is signed by or on
behalf of the Transferor Bank, the Transferee Bank and the Agent (on
behalf of itself, the Borrower and Stena AB, the Security Agent, the
Co-Arrangers and the other Banks). Upon signature of any such Transfer
Certificate
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by the Agent, which signature shall be effected as promptly as is
practicable after such Transfer Certificate has been delivered to the
Agent, and subject to the terms of such Transfer Certificate, such
Transfer Certificate shall have effect as set out below.
The following further provisions shall have effect in relation to any
Transfer Certificate:-
(A) a Transfer Certificate may be in respect of a Bank's rights in
respect of all or part of its Commitment and shall be in
respect of the same proportion of its Contribution;
(B) a Transfer Certificate shall only be in respect of rights and
obligations of the Transferor Bank in its capacity as a Bank
and shall not transfer its rights and obligations as Agent or
Security Agent, or in any other capacity, as the case may be
and such other rights and obligations may only be transferred
in accordance with any applicable provisions of this
Agreement;
(C) a Transfer Certificate shall take effect in accordance with
English law as follows:-
(i) to the extent specified in the Transfer Certificate,
the Transferor Bank's payment rights and all its
other rights (other than those referred to in
paragraph (B) above) under this Agreement are
assigned to the Transferee Bank absolutely, free of
any defects in the Transferor Bank's title and of any
rights or equities which the Borrower had against the
Transferor Bank;
(ii) the Transferor Bank's Commitment is discharged to the
extent specified in the Transfer Certificate;
(iii) the Transferee Bank becomes a Bank with a
Contribution and a Commitment of the amounts
specified in the Transfer Certificate;
(iv) the Transferee Bank becomes bound by all the
provisions of this Agreement and the Security
Documents which are applicable to the Banks
generally, including those about pro rata sharing and
the exclusion of liability on the part of, and the
indemnification of, the Agent and the Security Agent
in accordance with the provisions of this Agreement
and to the extent that the Transferee Bank becomes
bound by those provisions, the Transferor Bank ceases
to be bound by them;
(v) an Advance or part of an Advance which the Transferee
Bank makes after the Transfer Certificate comes into
effect ranks in point of priority and security in the
same way as it would have ranked had it been made by
the Transferor Bank, assuming that any defects in the
Transferor Bank's title and any rights or equities of
any Security Party against the Transferor Bank had
not existed; and
(vi) the Transferee Bank becomes entitled to all the
rights under this Agreement which are applicable to
the Banks generally, including but not limited to
those relating to the Majority Banks and those under
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Clauses 4.5, 7 and 17, and to the extent that the
Transferee Bank becomes entitled to such rights, the
Transferor Bank ceases to be entitled to them;
(D) the rights and equities of the Borrower or of any other
Security Party referred to above include, but are not limited
to, any right of set off and any other kind of cross-claim;
(E) the Borrower, the Security Agent, the Banks, Stena AB and the
Co-Arrangers hereby irrevocably authorise and instruct the
Agent to sign any such Transfer Certificate on its behalf
(and, in the case of the Security Agent, on behalf of any
Security Party which has in the relevant Security Document
given a corresponding authorisation and instruction to the
Security Agent) and undertake not to withdraw, revoke or
qualify such authority or instruction at any time. Promptly
upon its signature of any Transfer Certificate, the Agent
shall notify the Borrower, the Security Agent, the Transferor
Bank and the Transferee Bank.
20.4 Reliance on Transfer Certificate
(A) The Agent shall be entitled to rely on any Transfer
Certificate believed by it to be genuine and correct and to
have been presented or signed by the persons by whom it
purports to have been presented or signed, and shall not be
liable to any of the parties to this Agreement and the
Security Documents for the consequences of such reliance.
(B) (i) The Agent shall at all times during the continuation
of this Agreement maintain a register in which it
shall record the name, Commitments, Contributions and
administrative details (including the lending office)
from time to time of each Bank holding Transfer
Certificates and the date at which the transfer
referred to in such Transfer Certificate held by each
Bank was transferred to such Bank, and the Agent
shall make the said register available for inspection
by any Bank, the Security Agent, the Borrower and
Stena AB during normal banking hours upon receipt by
the Agent of reasonable prior notice requesting the
Agent to do so.
(ii) The entries on the said register shall, in the
absence of manifest error, be conclusive in
determining the identities of the Commitments, the
Contributions and the Transfer Certificates held by
the Banks from time to time and the principal amounts
of such Transfer Certificates and may be relied upon
by the Agent, the Security Agent and the other
Security Parties for all purposes in connection with
this Agreement and the Security Documents.
20.5 Transfer fees and expenses
If any Bank causes the transfer of all or any part of its rights,
benefits and/or obligations under the Security Documents, it shall pay
to the Agent for its own account a registration fee of $1,000 for each
transfer, and shall also pay to the Agent on demand all costs, fees and
expenses (including, but not limited to, legal fees and
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expenses), and all value added tax thereon, certified by the Agent as
having been reasonably incurred by it in connection with such
transfer.
20.6 Documenting assignments and transfers
If any Bank transfers all or any part of its rights, benefits and/or
obligations as provided in Clause 20.3 the Borrower and Stena AB
undertake, immediately on being requested to do so by the Agent and at
the cost of the Transferor Bank, to enter into, and procure that the
other Security Parties shall enter into, such documents as may be
necessary or desirable to transfer to the Transferee Bank all or the
relevant part of such Bank's interest in the Security Documents and all
relevant references in this Agreement to such Bank shall thereafter be
construed as a reference to the Bank and/or its Transferee Bank (as the
case may be) to the extent of their respective interests.
20.7 Sub-participation
A Bank may not sub-participate all or any part of its rights and/or
obligations under the Security Documents without the consent of the
Borrower (such consent not to be unreasonably withheld).
20.8 Lending office
Each Bank shall lend through its office at the address specified in
Schedule 1 or, as the case may be, in any relevant Transfer Certificate
or through any other office of such Bank selected from time to time by
it through which such Bank wishes to lend for the purposes of this
Agreement. If the office through which such Bank is lending is changed
pursuant to this Clause 20.8, such Bank shall notify the Agent promptly
of such change and the Agent shall notify the Borrower.
20.9 Disclosure of information
Any Bank may disclose to a prospective assignee, substitute or
transferee or to any other person who may propose entering into
contractual relations with the Bank in relation to this Agreement such
information about the Borrower and the Stena AB Group as such Bank
shall consider appropriate if such Bank first procures that the
relevant prospective assignee, substitute or transferee or other person
(such person together with any prospective assignee, substitute or
transferee being hereinafter described as the "PROSPECTIVE ASSIGNEE")
shall undertake to the Borrower to keep secret and confidential and,
not without the prior written consent of the Borrower, disclose to any
third party any of the information, reports or documents supplied by
such Bank provided however that the Prospective Assignee shall be
entitled to disclose any such information, reports or documents in the
following situations:-
(A) in relation to any proceedings arising out of this Agreement
or the other Security Documents to the extent considered
necessary by the Prospective Assignee to protect its interest;
or
(B) pursuant to a court order relating to discovery or otherwise;
or
(C) pursuant to any law or regulation or to any fiscal, monetary,
tax, governmental or other competent authority; or
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(D) to its auditors, legal or other professional advisers.
In addition, the Prospective Assignee shall be entitled to disclose or
use any such information, reports or documents if the information
contained therein shall have emanated, in conditions free from
confidentiality, bona fide from some person other than such Bank or the
Borrower or any member of the Stena AB Group.
20.10 No additional costs
If at the time of, or immediately after, any transfer by a Bank of any
part of the rights, benefits and/or obligations under this Agreement,
or any change in the office through which it lends for the purposes of
this Agreement, the Borrower would be obliged to pay to the Transferee
Bank or (in the case of a change of lending office) the Bank under
Clauses 7.7 (grossing up) or 17.2 (increased costs) any sum in excess
of the sum (if any) which it would have been obliged to pay to the
relevant Bank under the relevant Clause in the absence of such transfer
or change, the Borrower shall not be obliged to pay that excess.
21. REFERENCE BANKS, CO-ARRANGERS, AGENT AND SECURITY AGENT
21.1 Reference Banks
If (i) the whole of the Contribution (if any) of any Reference Bank is
prepaid, (ii) the Commitments (if any) of any Reference Bank are
reduced to zero in accordance with Clause 17 or any other relevant
provision hereof, (iii) a Reference Bank transfers the whole of its
rights and obligations (if any) as a Bank under this Agreement or (iv),
where applicable, any Reference Bank ceases to provide quotations to
the Agent for the purposes of determining LIBOR, the Agent may, acting
on the instructions of the Majority Banks, terminate the appointment of
such Reference Bank and appoint another Bank to replace such Reference
Bank.
21.2 Decision making
(A) Decisions requiring consent of all the Banks
Save as expressly provided in Clause 21.2(B) or as otherwise
expressly provided herein, any proposed course of action in
connection with any matter requiring the consent of the Banks
under or in connection howsoever with this Agreement or any
other Security Document shall only be taken with the consent
of all the Banks including, but without limitation to the
generality of the foregoing:-
(i) (save as required by the terms of the Security
Documents) the release of any of the Security
Documents or the release of any Security Party from
any of its obligations hereunder or under any other
Security Document;
(ii) the amendment of any of the provisions of this
Agreement or any other of the Security Documents;
(iii) any time or other indulgence to be granted to the
Borrower or any other Security Party in respect of
its obligations under any of the
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Security Documents.
(B) Decisions requiring consent of the Majority Banks
Proposals in connection with the following matters shall, in
the absence of agreement thereon by all of the Banks or as
otherwise provided in this Agreement, be determined by the
Majority Banks:-
(i) the making of any declaration by the Agent under
Clause 15.2;
(ii) the institution of any legal proceedings for the
enforcement of any rights or powers whatsoever
pursuant to the terms of this Agreement or any other
of the Security Documents;
(iii) any course of action whatsoever from time to time
(other than the making of a demand for payment
hereunder) whether of a legal or commercial nature or
otherwise howsoever for the purpose of achieving a
full or partial recovery of any principal, interest
or other amount due and payable by the Borrower
hereunder or otherwise in connection therewith
following the making of a declaration by the Agent
under Clause 15.2;
(iv) any other matter in respect of which this Agreement
or any other Security Document expressly provides
that the consent of the Majority Banks shall be
required.
(C) Method of soliciting agreement
Any determination of the Banks shall be ascertained by the
Agent or the Security Agent (as the case may be) either:-
(i) by means of a telefax sent by the Agent or the
Security Agent (as the case may be) to each of the
Banks in identical terms on the proposal or matter in
issue; or
(ii) by means of the vote of representatives of each Bank
at a meeting convened by the Agent or the Security
Agent (as the case may be) and held for the purpose
of discussing (inter alia) such proposal or matter in
issue.
Furthermore, it is hereby agreed by the Banks that:-
(a) where a decision of the Banks is sought by the Agent or the
Security Agent by means of a telefax sent in accordance with
paragraph (i) above and provided that the Agent or Security
Agent (as appropriate) verifies forthwith by telephone with
each relevant Bank that it has received such telefax in good
order, then the Agent or Security Agent (as the case may be)
may in its telefax:-
(i) recommend a proposed course of action to be taken by
the Banks; and
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(ii) specify a time limit (of not less than three (3)
Banking Days) within which the Banks are required to
respond to the Agent's or Security Agent's
recommendation
so that, if any Bank fails to notify the Agent or Security
Agent (as appropriate) within such time limit of its
response to the recommendation, such Bank shall be deemed to
have accepted and approved the course of action proposed by
the Agent or the Security Agent (as the case may be); and
(b) where the approval of the Majority Banks is required in
respect of any matter, the approval shall be deemed to have
been given as soon as the Agent or the Security Agent (as
the case may be) receives the requisite number of votes in
favour of the proposal so that the Agent or Security Agent
may act on the basis of such votes without having to wait
for the response of (or to give any notification to) any
other Bank who has yet to reply to the Agent or Security
Agent.
21.3 The Agent
(A) Appointment of the Agent
Each of the Banks, the Co-Arrangers and the Security Agent
hereby appoints the Agent to act as its agent under this
Agreement with such rights, powers and discretions as are
expressly delegated to the Agent hereunder.
(B) Obligations of the Agent
The Agent shall:-
(i) promptly inform the Banks of the contents of any
notice or request received by it from the Borrower or
any other Security Party under the Security Documents
(whether such notice or request is addressed to the
Agent alone or the Agent on behalf of the Banks
and/or the Security Agent) and of any information
delivered to it pursuant to Clause 10.2(C) and of any
other matters which the Agent considers material;
(ii) promptly deliver to the Banks copies of any accounts
and certificates delivered to it pursuant to Clause
10.2 and, as soon as reasonably practicable after the
Availability Date, copies of the documents delivered
in satisfaction of the requirements of Schedule 5;
(iii) promptly inform the Banks in reasonable detail of any
exercise by it of any of the rights, powers and/or
discretions vested in it hereunder (but without the
Agent being under any obligation to give prior notice
to the Banks of any such exercise);
(iv) promptly notify the Banks of the occurrence of any
Default or any other default by a Security Party in
the due performance of or compliance with its
material obligations under any of the Security
Documents of which the Agent has actual knowledge or
actual notice
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and the occurrence of which the Agent has verified;
(v) if directed by the Majority Banks, exercise (or
refrain from exercising) any right, power or
discretion vested in it hereunder in accordance with
the directions (subject to Clause 21.2(A)) of the
Majority Banks provided, however, that it may refrain
from acting in accordance with any such directions
until it has received such security as it may require
(whether by way of payment in advance or otherwise)
for all costs, claims, expenses (including legal
fees) and liabilities which it will or may expend or
incur in complying with such directions and for this
purpose the Agent shall make a demand for such
security addressed to all the Banks;
(vi) receive from the Borrower all payments of principal,
interest and other moneys expressed to be payable to
the Agent hereunder on behalf of all or any of the
Banks, the Co-Arrangers and/or the Security Agent and
shall receive from the Security Agent the proceeds of
realisation of the securities constituted by the
Security Documents and shall promptly distribute the
same amongst the Banks, the Co-Arrangers, the
Security Agent and itself in accordance with the
terms of this Agreement pending which the Agent shall
hold any and all such moneys on trust for the Banks,
the Co-Arrangers, the Security Agent and itself.
(C) Relationship of agent and principal
The relationship between the Agent on the one part and each
Bank, the Co-Arrangers and the Security Agent on the other is
that of agent and principal and, except in relation to any
moneys referred to in Clause 21.3(B)(vi) held by the Agent
pending distribution hereunder, the Agent shall not have a
fiduciary relationship with or be, or be deemed to be, a
trustee of or for any such party.
21.4 The Security Agent
(A) Appointment of the Security Agent
Each of the Banks, the Co-Arrangers and the Agent hereby
appoints the Security Agent to act for and on its behalf as
its trustee in connection with this Agreement and the other
Security Documents and authorises the Security Agent to enter
into each of the Security Documents and exercise such rights,
powers and discretions as are specifically delegated to it by
the terms thereof together with such rights, powers and
discretions as are reasonably incidental thereto.
(B) The Trust Property
In this Clause 21 the expression "TRUST PROPERTY" shall mean:-
(i) all rights, title and interests that may at any time
be or have been granted, mortgaged, charged or
assigned in favour of the Security Agent pursuant to
the Security Documents (except to the extent that
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such rights, title and/or interests are intended to
be for the sole benefit or protection of the Security
Agent);
(ii) all moneys which are received or recovered by or on
behalf of the Security Agent under or by virtue of
any right, title and/or interest described in
paragraph (i) above; and
(iii) all moneys and other assets accrued on, or derived
from, any moneys described in paragraph (ii) above
but shall not include any moneys which the Security
Agent has transferred to the Agent or (being entitled
to do so) has retained in accordance with the
provisions of Clause 21.4(D).
(C) Declaration of trust
The Security Agent shall hold the Trust Property for the
benefit of each of the Banks, the Co-Arrangers, the Agent and
itself from time to time upon the trusts and in accordance
with the provisions contained in this Clause 21 and the
obligations, rights and benefits vested or to be vested in the
Security Agent by this Agreement, any other Security Document
or any document entered into pursuant hereto or thereto shall
(as well before as after enforcement) be performed and (as the
case may be) exercised in accordance with the provisions of
this Clause 21.
(D) Application of moneys
Save as expressly stated to the contrary herein or in any
other Security Document, any moneys received or recovered by
the Security Agent and which form part of the Trust Property
shall (without prejudice to the rights of the Security Agent
pursuant to any Security Document to credit any moneys
received by it to any suspense account) be transferred
forthwith to the Agent for distribution in accordance with the
relevant provisions of this Agreement
Provided however that, before transferring such moneys to the
Agent, the Security Agent shall be entitled to deduct
therefrom any sum then properly due and payable under this
Agreement or any other Security Document to the Security Agent
or any receiver, attorney, agent, delegate or other person
appointed by it and retain that sum for its own account or (as
the case may be) remit such sum to the other person to whom it
is then due and payable.
For as long as Svenska Handelsbanken AB (publ) continues to
act as both Agent and Security Agent (or at any other time
when any single bank shall act in both such capacities) it
shall be sufficient for the purposes of complying with this
Clause 21.4(D) for the moneys concerned to be credited to the
account kept by the Agent for the purposes of dealing with
amounts received by it under or pursuant to the Security
Documents.
(E) Duties of the Security Agent
In addition to its obligations under Clause 21.4(D) the
Security Agent shall:-
(i) promptly inform the Banks of the contents of any
notice or request
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received by it from the Borrower or any other
Security Party under the Security Documents and of
any other matters which the Security Agent
considers material;
(ii) promptly inform the Banks in reasonable detail of any
exercise by it of any of the rights, powers and/or
discretions vested in it hereunder (but without the
Security Agent being under any obligation to give
prior notice to the Banks of any such exercise);
(iii) promptly notify the Banks of the occurrence of any
Default or any other default by a Security Party in
the due performance of or compliance with its
material obligations under any of the Security
Documents of which the Security Agent has actual
knowledge or actual notice and the occurrence of
which the Security Agent has verified;
(iv) if directed by the Majority Banks, exercise (or
refrain from exercising) any right, power or
discretion vested in it hereunder in accordance with
the directions (subject to Clause 21.2(A)) of the
Majority Banks provided, however, that it may refrain
from acting in accordance with any such directions
until it has received such security as it may require
(whether by way of payment in advance or otherwise)
for all costs, claims, expenses (including legal
fees) and liabilities which it will or may expend or
incur in complying with such directions and for this
purpose the Security Agent shall make a demand for
such security addressed to all the Banks.
(F) Powers and discretions of the Security Agent
The Security Agent shall have all the powers and discretions
conferred upon a trustee by the Trustee ▇▇▇ ▇▇▇▇ and/or any
other relevant legislation from time to time in force (to the
extent not inconsistent herewith) and upon a receiver
appointed under the Security Documents or any of them (as
though the Security Agent were a receiver thereunder).
(G) Delegation of powers; appointment of co-trustees
The Security Agent shall be entitled:-
(i) whenever it thinks fit, to delegate by power of
attorney or otherwise to any person or persons all or
any of the rights, trusts, powers, authorities and
discretions vested in it by this Agreement or any
other Security Document and such delegation may be
made upon such terms and subject to such conditions
and subject to such regulations as the Security Agent
may think fit and the Security Agent shall not be
bound to supervise the proceedings or be in any way
responsible for any loss incurred by reason of any
misconduct or default on the part of any such
delegate or sub-delegate provided that the Security
Agent shall have acted reasonably in making such
delegation to such delegate and the Security Agent
shall promptly give notice to each of the Banks, the
Co-Arrangers and the Agent of the appointment of any
delegate or
-141-
such delegate as aforesaid; and
(ii) with the prior consent of the Majority Banks and the
Borrower, to appoint (and subsequently to dismiss)
such other person or persons as it thinks fit to
become additional trustees hereunder (but so that
there shall not be more than two trustees at any
time) to assist it in carrying out its rights and
duties hereunder and under the other Security
Documents and each such additional trustee shall be
entitled to the same rights and subject to the same
obligations hereunder as the Security Agent.
(H) Amendments and waivers to Security Documents
Each of the Banks, the Co-Arrangers and the Agent hereby
authorises the Security Agent to enter into any amendment to
any Security Document or to grant any waiver of any obligation
of any Security Party under any Security Document which in
either case has either been approved by the Banks or is, in
the unfettered opinion of the Security Agent, of a minor or
technical nature and not likely to have any material effect on
the obligation of the relevant Security Party under the
relevant Security Document.
(I) Security Agent to be creditor
The parties hereto agree that for the purpose of enforcing
rights established under the Security Documents in the
Netherlands, to the extent Netherlands law will apply thereto,
the Security Agent will be the joint creditor of each and
every obligation of the Borrower towards the Banks, the
Co-Arrangers and the Agent under this Agreement, so that the
Security Agent will have its own independent right to demand
performance by the Borrower of each such obligation but so
that payment to the Security Agent will serve as payment to
the Banks, the Co-Arrangers and the Agent (as appropriate) and
payment to any of the Banks, the Co-Arrangers and the Agent
will serve as payment to the Security Agent.
(J) Winding-up of trusts
If:-
(i) all of the liabilities of the Borrower secured under
the Security Documents have been fully and finally
discharged; and
(ii) no future or contingent liability remains
outstanding; and
(iii) the Security Agent is satisfied that there is no
substantial risk of any payment or other transaction
under this Agreement or any other Security Document
being set aside in any liquidation or insolvency of
the Borrower or any other Security Party which has
previously occurred or may later occur
then the trusts herein created shall be wound-up and the
Security Agent shall release, without recourse or warranty,
all security granted to it pursuant to the Security Documents
then held by it, whereupon the Security Agent, the Banks,
-142-
the Co-Arrangers and the Agent shall each be released from
their respective obligations under this Clause 21.4 (except
those which arose prior to such winding-up).
(K) Perpetuity period
The perpetuity period under the rule against perpetuities if
applicable to the Trust Property shall be the period of eighty
(80) years from the date of this Agreement.
(L) Governing law
The trusts created by this Clause 21 shall be governed by and
construed in accordance with English law.
21.5 The Agent and Security Agent: common provisions
(A) Powers of the Agent and Security Agent generally
In addition to the powers expressly given to the Agent
and/or the Security Agent by this Agreement:-
(i) the Banks may give the Agent and/or the Security
Agent (generally or in any particular case) any
powers which the Banks consider appropriate; and
(ii) each of the Agent and the Security Agent has power to
take any other action which it considers to be
reasonably incidental or conducive to the performance
of its functions under this Agreement or otherwise
appropriate in the context of those functions,
including the exercise of any powers given to it by
the Banks.
(B) Exercise of the Agent's and Security Agent's powers
The rights, powers and discretions vested in the Agent and the
Security Agent by this Agreement and/or the other Security
Documents shall only be exercised by the Agent or the Security
Agent (as the case may be) in accordance with the instructions
of the Majority Banks or (if so required in accordance with
the provisions of Clause 21.2(A)) the Banks provided however
that the Agent and the Security Agent shall each be entitled
(but not bound) to exercise or refrain from exercising any
such right, power or discretion without the directions of the
Majority Banks or the Banks (as the case may be) if the Agent
or Security Agent (as appropriate) believes that the immediate
exercise of such right, power or discretion is necessary or
desirable to protect the interests of the Banks under or in
respect of the Security Documents or to protect or preserve
the security afforded thereby.
Where any right, power or discretion is vested in the Security
Agent under this Agreement or any other Security Document but
is expressed as being exercisable in accordance with the
directions of the Banks or the Majority Banks, such right,
power or discretion shall not be exercised by the Security
-143-
Agent without the lawful directions of the Banks or the
Majority Banks (as the case may be).
(C) Limit of Agent's and Security Agent's obligations
Notwithstanding anything to the contrary expressed or implied
herein or in any other Security Document, neither the Agent
nor the Security Agent shall:-
(i) be bound to enquire as to the occurrence or otherwise
of any Default or as to the performance by any
Security Party of its obligations under any of the
Security Documents;
(ii) be bound to disclose to any other person any
information relating to any Security Party if such
disclosure would or might in its opinion constitute a
breach of any law or regulation or be otherwise
actionable at the suit of any person;
(iii) have any responsibility to the Banks, the
Co-Arrangers or each other for:-
(a) the financial position, creditworthiness,
affairs or prospects of any of the Security
Parties;
(b) the performance or non-performance howsoever by
any of the Security Parties of any of their
obligations hereunder or under any of the
Security Documents;
(c) the due execution, effectiveness, genuineness,
validity or enforceability of any of the
Security Documents or any document relating
thereto or any filing or recording thereof or
the taking of any other action whatsoever and
howsoever in connection therewith or the
collectability of any sum due thereunder;
(d) any computations and/or information supplied to
the Banks by the Agent or the Security Agent in
reliance upon which the Banks have entered into
this Agreement;
(iv) be under any liability whatsoever for any consequence
of relying on:-
(a) any written communication or document
believed by it to be genuine or correct and
to have been communicated or signed by the
person by whom it is purported to have been
communicated or signed; or
(b) the advice or opinions of any professional
advisers selected by it;
(v) be under any duty to account to any Bank, the
Co-Arrangers or each other for any sum received by it
for its own account or the profit element of any such
sum;
-144-
(vi) be under any obligation other than those for which
express provision is made herein.
(D) Rights of the Agent and Security Agent
Each of the Agent and Security Agent may:-
(i) carry out its duties hereunder through such officers,
directors, employees, consultants or independent
agents as it may in its unfettered discretion think
fit;
(ii) assume that no Default has occurred and that none of
the Security Parties is in breach of its obligations
under any of the Security Documents unless the Agent
or the Security Agent (as the case may be) has actual
knowledge or actual notice to the contrary;
(iii) engage and pay for the advice or services of any
internal or external lawyers, accountants, surveyors
or other experts whose advice or services may to it
seem necessary, expedient or desirable and rely upon
any advice so obtained;
(iv) rely as to any matters of fact which might reasonably
be expected to be within the knowledge of any
Security Party upon a certificate signed by or on
behalf of that Security Party;
(v) rely upon any communication or document believed by
it to be genuine.
(E) Responsibilities of the Banks and the Co-Arrangers
It is understood that each of the Banks and the Co-Arrangers
has itself been, and will continue to be, solely responsible
for making its own independent appraisal of and investigations
into the financial condition, creditworthiness, condition,
affairs, status and nature of each Security Party and,
accordingly, each of the Banks and the Co-Arrangers warrants
to both the Agent and the Security Agent that it has not
relied and will not rely on the Agent or the Security Agent:-
(i) to check or enquire on its behalf into the adequacy,
accuracy or completeness of any information provided
by any Security Party in connection with this
Agreement or any other Security Document; or
(ii) to assess or keep under review on its behalf the
financial condition, creditworthiness, condition,
affairs, status or nature of any Security Party.
(F) Administration
Subject to the terms of this Agreement, this Agreement and the
other Security Documents shall be serviced, supervised and
administered by the Agent and the Security Agent respectively
in the ordinary course of its business and in accordance with
its usual practices. In performing its duties and functions
-145-
hereunder, the Agent or the Security Agent (as the case may
be) shall exercise the same care as it normally exercises in
making and administering loans for its own account, but
assumes no further responsibility in respect of such
performance.
(G) Limitation of liability
Neither the Agent nor the Security Agent shall be under any
liability as a result of taking or omitting to take any action
in relation to this Agreement or any other Security Document
save in the case of gross negligence or wilful misconduct and
neither the Banks nor the Co-Arrangers will assert or seek to
assert against any director, officer or employee of the Agent
or the Security Agent (as the case may be) any claim they
might have against any of them in respect of the matters
referred to in this Clause 21.5(G).
(H) No restriction on other business
Neither the Agent nor the Security Agent (nor any officer
thereof) shall be precluded by reason of so acting from
underwriting, guaranteeing the subscription of or subscribing
for or otherwise acquiring, holding or dealing with any
debentures, shares or securities whatsoever of any Security
Party or from entering into any contract or financial or other
transaction with or from engaging in any banking or other
business with any Security Party and shall not be liable to
account for any profit made or payment received by it thereby
or in connection therewith.
21.6 Retirement and replacement of the Agent and the Security Agent
--------------------------------------------------------------
(A) Either or both of the Agent and the Security Agent may retire
at any time without assigning any reason by giving to the
Borrower, the Banks and the Security Agent or Agent (as the
case may be) not less than thirty (30) days notice of its
intention to do so. Unless the Agent or Security Agent (as
appropriate) in its notice of retirement nominates any of
its associated companies to be its successor, the successor
Agent or Security Agent may be appointed by the Majority
Banks (with the prior written consent of the Borrower, such
consent not to be unreasonably withheld or delayed) during
such thirty (30) day period provided that, should they fail
to do so, the Agent or the Security Agent (as the case may
be) may then appoint as its successor a reputable and
experienced bank with an office in London.
(B) If any Bank is dissatisfied with the Agent and/or the Security
Agent and wants it to be replaced, such Bank shall consult
with the other relevant Banks and the Borrower for a period
of up to thirty (30) days to decide whether the Agent and/or
the Security Agent should be replaced and, if so, by whom
(such replacement being one of the relevant Banks or an
associated company thereof). If at the end of such period
the relevant Banks unanimously agree that the Agent and/or
the Security Agent (as the case may be) should be replaced
by a particular Bank or one of its associated companies, and
if the Borrower consents in writing to the identity of the
proposed replacement (such consent (i) not to be
unreasonably withheld and (ii) not to be required if an
Event of Default has occurred and is continuing), then
notice shall be given
-146-
by the relevant Banks to the Agent and/or the Security Agent
(as the case may be) specifying the date, being not fewer
than five (5) Banking Days after the date of such notice, on
which the appointment of the successor Agent and/or Security
Agent is, subject to Clause 21.6(D), to take effect.
(C) For the purposes of this Clause 21.6(A):-
(i) an "ASSOCIATED COMPANY" of the Agent or Security
Agent or any Bank shall mean any company which is a
holding company of the Agent or Security Agent or
such Bank (as the case may be) or a wholly-owned
subsidiary of it or its parent company; and
(ii) "RELEVANT BANKS" means all of the Banks other than
that Bank which acts as Agent or (as the case may be)
Security Agent or whose associated company acts in
such capacity.
(D) Any appointment of a successor Agent or Security Agent under
Clause 21.6(A) or (B) shall take effect upon:-
(i) the successor confirming in writing its agreement to
be bound by the provisions of this Agreement; and
(ii) notice thereof by the Agent or Security Agent and its
successor (which notice, in the case of a new Agent,
shall specify the bank in New York to which payments
to the new Agent shall be made thereafter) being
given to each of the other parties to this Agreement
and/or the other Security Documents; and
(iii) in the case of a new Security Agent, the outgoing
Security Agent has transferred to its successor all
of its rights and obligations under the Security
Documents.
(E) If a successor to the Agent or Security Agent is appointed
under the provisions of this Clause 21.6:-
(i) the outgoing Agent or Security Agent (as the case may
be) shall be discharged from any further obligation
under this Agreement;
(ii) its successor and each of the other parties hereto
shall have the same rights and obligations amongst
themselves as they would have had if such successor
had been a party hereto in place of the outgoing
Agent or Security Agent (as the case may be);
(iii) Clause 21 and the other provisions of this Agreement
shall remain in effect for the benefit and protection
of the outgoing Agent or Security Agent (as the case
may be) in relation to any claim or loss which may be
brought against or incurred by it in connection with
or as a result of any act, omission, breach, neglect
or other occurrence or matter relating to or arising
out of this Agreement which took place before its
resignation.
-147-
22. NOTICES AND OTHER MATTERS
22.1 Notices
Every notice, request, demand or other communication under this
Agreement or (unless otherwise provided therein) under any of the other
Security Documents shall:-
(A) be in writing delivered personally or by first-class prepaid
letter (airmail if available) or facsimile transmission or
other means of telecommunication in permanent written form
provided that any communication by facsimile transmission
shall be confirmed forthwith by letter;
(B) be deemed to have been received, subject as otherwise provided
in the relevant Security Document, in the case of a letter,
when delivered personally or 5 days after it has been put in
to the post and, in the case of a facsimile transmission or
other means of telecommunication in permanent written form, at
the time of despatch (provided that if the date of despatch is
not a business day in the country of the addressee or if the
time of despatch is after the close of business in the country
of the addressee it shall be deemed to have been received at
the opening of business on the next such business day); and
(C) be sent:-
(i) to the Borrower at:-
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇-▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Marked for attention: Jan Larsson
with a copy to the Borrower at:-
World Trade Centre
Amsterdam Airport
Schipol ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Marked for attention: Deputy General Manager
-148-
(ii) to Stena AB at:-
▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇▇▇▇
Marked for attention: Finance Manager
to the Agent and the Security Agent at:-
Svenska Handelsbanken AB (publ)
Regional Bank of Western Sweden
▇▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Marked for attention: RVIC ▇▇▇▇▇ ▇▇▇
(▇▇▇) to each Bank or Co-Arranger at its address and fax
number specified in Schedule 1 or in any relevant
Transfer Certificate,
or to such other address and/or numbers as is notified by
one party to the other party under this Agreement;
(D) be sent by the Borrower or Stena AB to the Banks or the
Co-Arrangers by sending the same to the Agent and by the Banks
and the Co-Arrangers to the Borrower and Stena AB by
forwarding the same through the Agent.
22.2 No implied waivers, remedies cumulative
No failure or delay on the part of the Agent, the Co-Arrangers, the
Security Agent, the Banks or any of them to exercise any power, right
or remedy under any of the Security Documents shall operate as a waiver
thereof, nor shall any single or partial exercise by the Agent, the
Co-Arrangers, the Security Agent, the Banks or any of them 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 the Security Documents are cumulative and are not exclusive
of any remedies provided by law.
22.3 Further assurance
The Borrower and Stena AB undertake that the Security Documents shall,
both at the date of execution and delivery thereof and so long as any
moneys are owing under any of the Security Documents, be valid and
binding obligations of the respective parties thereto and the rights of
the Agent, the Security Agent, the Banks and the Co-Arrangers
thereunder enforceable in accordance with their respective terms and
that they will, at their expense, execute, sign, perfect and do, and
will procure the execution, signing, perfecting and doing by each of
the other Security Parties of, any
-149-
and every such further assurance, document, 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.
22.4 English language
All certificates, instruments and other documents to be delivered under
or supplied in connection with any of the Security Documents shall be
in the English language or shall be accompanied by a certified English
translation upon which the Agent shall be entitled to rely.
22.5 Third Party Rights
A person (including any body of persons) who is not a party to this
Agreement has no right under the Contracts (Rights of Third Parties)
▇▇▇ ▇▇▇▇ to enforce any term of this Agreement but this does not affect
any right or remedy of a third party which exists or is available apart
from that Act.
23. GOVERNING LAW AND JURISDICTION
23.1 Law
This Agreement is governed by and shall be construed in accordance with
English law.
23.2 Submission to jurisdiction
The Borrower and Stena AB each agree, for the benefit of the Agent, the
Co-Arrangers, the Security Agent and the Banks, that any legal action
or proceedings arising out of or in connection with this Agreement
against the Borrower or Stena AB or any of its assets may be brought in
the English courts. The Borrower and Stena AB each hereby irrevocably
and unconditionally submits to the jurisdiction of such courts and
irrevocably designates, appoints and empowers Stena (UK) Limited at
present of ▇/▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ to receive for it and
on its behalf, service of process issued out of the English courts in
any such legal action or proceedings. The submission to such
jurisdiction shall not (and shall not be construed so as to) limit the
right of the Agent, the Co-Arrangers, the Security Agent or the Banks
to take proceedings against the Borrower and Stena AB in the courts of
any other competent jurisdiction nor shall the taking of proceedings in
any one or more jurisdictions preclude the taking of proceedings in any
other jurisdiction, whether concurrently or not. The parties further
agree that only the courts of England or Sweden and not those of any
other State shall have jurisdiction to determine any claim which the
Borrower or Stena AB may have against the Agent, the Co-Arrangers, the
Security Agent or any Bank arising out of or in connection with this
Agreement.
IN WITNESS whereof the parties to this Agreement have caused this Agreement to
be duly executed as a Deed on the date first above written.
-150-
SCHEDULE 1
----------
The Banks and their Commitments
-------------------------------
---------------------------------- -------------------------------------- --------------------- ------------------
NAME ADDRESS AND FAX NUMBER COMMITMENT PERCENTAGE
---- ---------------------- ---------- ----------
$ %
---------------------------------- -------------------------------------- --------------------- ------------------
The Chase Manhattan Bank (or ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ 22,000,000.00 8.000000
successor or nominated affiliate) ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇/
▇▇▇▇▇ Xenitides
---------------------------------- -------------------------------------- --------------------- ------------------
Svenska Handelsbanken AB (publ) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇
▇▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ 44,750,000.00 16.272727
Sweden
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Attention: RVIC STBNL 647
---------------------------------- -------------------------------------- --------------------- ------------------
Nordbanken AB ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇
(▇▇▇▇) ▇▇-▇▇▇ 09 Goteborg 44,750,000.00 16.272727
Sweden
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Attention: NORDEA Shipping Offshore
and Oil Services
---------------------------------- -------------------------------------- --------------------- ------------------
HSBC Bank plc Transport Industries
Corporate & Industrial Banking 22,000,000.00 8.000000
▇▇▇ ▇▇▇▇▇, ▇▇-▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
Attention: Simon Deefholts
---------------------------------- -------------------------------------- --------------------- ------------------
Landesbank Schleswig-Holstein Martensdamm 6
Girozentrale ▇-▇▇▇▇▇ ▇▇▇▇ 22,000,000.00 8.000000
Germany
Fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
Attention: Shipping
Department- ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------- -------------------------------------- --------------------- ------------------
The Governor and Company of the 2nd Floor, New Uberior House
Bank of Scotland ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ 22,000,000.00 8.000000
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
Attention: Loans Management Group
---------------------------------- -------------------------------------- --------------------- ------------------
-151-
---------------------------------- -------------------------------------- --------------------- ------------------
NAME ADDRESS AND FAX NUMBER COMMITMENT PERCENTAGE
---- ---------------------- ---------- ----------
$ %
---------------------------------- -------------------------------------- --------------------- ------------------
Den norske Bank ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇-▇▇▇▇ ▇▇▇▇ 22,000,000.00 8.000000
Norway
Fax: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Attention: Credit
Administration Shipping
---------------------------------- -------------------------------------- --------------------- ------------------
Scotiabank Europe plc ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 16,500,000.00 6.000000
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Fax: ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------- -------------------------------------- --------------------- ------------------
Skandinaviska Enskilda ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇
(▇▇▇▇) ▇-▇▇▇ 04 Goteborg 22,000,000.00 8.000000
Sweden
Fax: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Attention: PSF/Shipping
---------------------------------- -------------------------------------- --------------------- ------------------
ABN AMRO Bank N.V. ▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇ DD Rotterdam 15,000,000.00 5.454545
The Netherlands
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Attention: Mr ▇ ▇ van Mastrigt
and
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇▇
Attention: Mr P van der Have
---------------------------------- -------------------------------------- --------------------- ------------------
Nedship Bank (Nordic) ▇.▇. ▇▇▇ ▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇ 22,000,000 8.000000
Norway
Fax: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Attention: Mr Jan Hjellestad
---------------------------------- -------------------------------------- --------------------- ------------------
TOTAL 275,000,000 100
---------------------------------- -------------------------------------- --------------------- ------------------
-152-
SCHEDULE 2
----------
The Ships
---------
----------------------------- ------------------------------ -------------------------------- --------------------------------------
OWNER(S) ON
NAME CURRENT OWNER(S) AVAILABILITY DATE CLASSIFICATION
---- ---------------- ----------------- --------------
----------------------------- ------------------------------ -------------------------------- --------------------------------------
KONINGIN BEATRIX Stena Line B.V. Stena Line B.V. DNV+1A1 R280 Car Ferry A EO
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA CARISMA Stena Line AB Stena Line Scandinavia AB DNV+1A1 HSLC RI Car Ferry A EO ICS
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA CARRIER Stena Line Shipholding B.V. Stena Line Shipholding B.V. LR+100 A1 Ice Class 1A+LMC+ UMS
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA ▇▇▇▇▇▇ Stena Line AB Stena Line Scandinavia AB DNV+1A1 Car Ferry A EO ICE-1B
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA EUROPE 33 shares - Stena Line 33 shares - Stena Line DNV+1A1 Car Ferry A MCDK ICE- 1C
Shipholding B.V. Shipholding B.V.
31 shares - Stena Line AB 31 shares - Stena Line
Scandinavia AB
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA FREIGHTER Stena Line AB Stena Line Scandinavia AB LR+100 A1 Ice Class 1A +LMC+UMS
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA GERMANICA Scandlines AB Scandlines AB LR+100 A1 Car Ferry, Ice Class 2+LMC
and UMS
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA GOTHICA Stena Line Shipholding B.V. Stena Line Shipholding B.V. DNV+1A1 MCDK EO
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA SCANDINAVICA Stena Line AB Stena Line Scandinavia AB LR+100 A1 Car Ferry, Ice Class 2+LMC
and UMS
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA SCANRAIL Stena Line AB Stena Line Scandinavia AB BV 1 3/3 E Roll On Roll Off Deepsea
ICE III
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA SEARIDER Stena Line AB Stena Line Scandinavia AB DNV+1A1 Car and Train Ferry A EO ICE
-1B
----------------------------- ------------------------------ -------------------------------- --------------------------------------
STENA SEATRADER Stena Line B.V. Stena Line B.V. DNV+1A1 ICE- A
----------------------------- ------------------------------ -------------------------------- --------------------------------------
----------------------------- ----------------------------- ------------- ------------
CLASSIFICATION OFFICIAL
NAME SOCIETY NO./CALL FLAG
---- ------- --------- ----
SIGN
----------------------------- ----------------------------- ------------- ------------
KONINGIN BEATRIX Det norske Veritas 900301 British
----------------------------- ----------------------------- ------------- ------------
STENA CARISMA Det norske Veritas SGFV Swedish
----------------------------- ----------------------------- ------------- ------------
STENA CARRIER Lloyd's Register of Shipping SLUY Swedish
----------------------------- ----------------------------- ------------- ------------
STENA ▇▇▇▇▇▇ Det norske Veritas SKFH Swedish
----------------------------- ----------------------------- ------------- ------------
STENA EUROPE Det norske Veritas 730536 Bahamian
----------------------------- ----------------------------- ------------- ------------
STENA FREIGHTER Lloyd's Register of Shipping SEPG Swedish
----------------------------- ----------------------------- ------------- ------------
STENA GERMANICA Lloyd's Register of Shipping SKPZ Swedish
----------------------------- ----------------------------- ------------- ------------
STENA GOTHICA Det norske Veritas SCQO Swedish
----------------------------- ----------------------------- ------------- ------------
STENA SCANDINAVICA Lloyd's Register of Shipping ▇▇▇▇ Swedish
----------------------------- ----------------------------- ------------- ------------
STENA SCANRAIL Bureau Veritas SLBM Swedish
----------------------------- ----------------------------- ------------- ------------
STENA SEARIDER Det norske Veritas 900102 British
----------------------------- ----------------------------- ------------- ------------
STENA SEATRADER Det norske Veritas 904247 British
----------------------------- ----------------------------- ------------- ------------
-153-
SCHEDULE 3
----------
Commercial Documents
--------------------
STENA GERMANICA LOAN DOCUMENTS
1. The Stena Germanica Loan Agreement.
MANAGEMENT AGREEMENTS IN RESPECT OF THE SHIPS
1. m.v. "STENA SEARIDER" A ▇▇▇▇▇▇▇ 98 Management Agreement dated 28 August 2001 made between Stena
Line B.V. (formerly Stena Line Holland B.V.) ("SLBV") as disponent owner
and Northern Marine Management Limited ("NMML") as manager.
2. m.v. "STENA SEATRADER" A ▇▇▇▇▇▇▇ 98 Ship Management Agreement dated 1 March 2001 made between (1)
SLBV as owner and (2) NMML as manager.
CHARTER DOCUMENTS IN RESPECT OF THE SHIPS
1. m.v. "STENA SEARIDER" A BARECON 89 bareboat charter dated 25 September 2000 made between (1)
Stena Line as owner and (2) SLBV as charterer to be amended and novated on
or about the Availability Date by an addendum no. 1 to be made between (1)
Stena Line, (2) SLBV and (3) Stena Line Scandinavia (so as to constitute a
charter between (1) Stena Line Scandinavia as owner and (2) SLBV as
charterer).
2. m.v. "STENA CARRIER" A BARECON 89 bareboat charter dated 1 January 1992 made between (1) Stena
Carrier Ltd ("SCL") as owner and (2) Stena Line as charterer as amended and
novated by addendum no. 1 dated 31 March 1995 made between (1) SCL, (2)
Stena Empress Ltd ("SEL") and (3) Stena Line (so as to constitute a charter
between (1) SEL as owner and (2) Stena Line as charterer) as further
amended and novated by an addendum no. 2 dated 20 December 1996 made
between (1) SEL, (2) Stena Line Shipholding B.V. ("SLSHBV") and (3) Stena
Line (so as to constitute a charter between (1) SLSHBV as owner and (2)
Stena Line as charterer) as further amended by an addendum no. 3 dated 15
January 1997 made between (1) SLSHBV and (2) Stena Line and as further
amended by an addendum no. 4 dated 15 January 1999, an addendum no. 5 dated
15 January 2000, an addendum no. 6 dated 5 February 2001, each between (1)
SLSHBV and (2) Stena Line, and to be further amended and novated on or
about the Availability
-154-
Date by an addendum no. 7 to be made between (1) SLSHBV, (2) Stena Line and
(3) Stena Line Scandinavia (so as constitute a charter between (1) SLSHBV
as owner and (2) Stena Line Scandinavia as charterer).
3. m.v. "STENA GOTHICA" A BARECON 89 bareboat charter dated 15 October 1994 made between 4 (1)
Scandinavica Ltd as owner and (2) Stena Line Scandinavia AB (formerly known
as Stena Line Service AB and subsequently merged into Stena Line on 1
January 1999) as charterer as amended and novated by an addendum no. 1
dated 31 March 1995 made between (1) Scandinavica Ltd (2) SEL and (3) Stena
Line Scandinavia AB (so as to constitute a charter between (1) SEL as owner
and (2) Stena Line Scandinavia AB as charterer) as further amended by an
addendum no. 2 dated 9 January 1996 between (1) SEL and (2) Stena Line
Scandinavia AB as further amended and novated by an addendum no. 3 dated 16
December 1996 made between (1) SEL, (2) SLSHBV and (3) Stena Line
Scandinavia AB (so as to constitute a charter between (1) SLSHBV as owner
and (2) Stena Line Scandinavia AB as charterer) as further amended by an
addendum no. 4 dated 15 January 1997 and an addendum no. 5 dated 31 August
1998 each between (1) SLSHBV and (2) Stena Line Scandinavia AB and as
further amended by an addendum no. 6 dated 15 January 1999, an addendum no.
7 dated 17 January 2000, an addendum no. 8 dated 31 August 2000, an
addendum no. 9 dated 5 February 2001 each between (1) SLSHBV and (2) Stena
Line (as successor to Stena Line Scandinavia AB) an addendum no. 10 dated
17 September 2001 and to be further amended and novated on or about the
Availability Date by an addendum no. 11 to be made between (1) SLSHBV, (2)
Stena Line and (3) Stena Line Scandinavia (so as to constitute a charter
between (1) SLSHBV as owner and (2) Stena Line Scandinavia as charterer).
4. m.v. "STENA GERMANICA" A BARECON 89 bareboat charter dated 20 December 2000 between (1) 5
Scandlines AB as owner and (2) Stena Line as charterer to be amended and
novated on or about the Availability Date by an addendum no. 1 to be made
between (1) Scandlines AB, (2) Stena Line and (3) Stena Line Scandinavia
(so as to constitute a charter between (1) Scandlines AB as owner and (2)
Stena Line Scandinavia as charterer).
-155-
5. m.v. "STENA EUROPE" A BARECON 89 bareboat charter dated 26 May 1997 between (1) SLSHBV as
33/64th owner and Stena Line as 31/64th owner and (2) Stena Line as
charterer as amended by an addendum no. 1 dated 25 June 2001 and to be
further amended and novated on or about the Availability Date by an
addendum no. 2 to be made between (1) SLSHBV, (2) Stena Line and (3) Stena
Line Scandinavia (as so to constitute as charter between (1) SLSHBV as
33/64th owner and Stena Line Scandinavia as 31/64th owner and (2) Stena
Line Scandinavia as charterer).
6. m.v. "KONINGIN BEATRIX" A BARECON 89 bareboat charter dated 9 June 1997 between (1) SLBV 7 as owner
and (2) Stena Line Limited ("SLL") as charterer as amended by an addendum
no. 1 dated 1 June 1999, an addendum no. 2 dated 5 February 2001 and to be
amended on or about the Availability Date by an addendum no. 3 each between
(1) SLBV and (2) SLL.
-156-
SCHEDULE 4
----------
Form of Drawdown Notice
-----------------------
To: SVENSKA HANDELSBANKEN AB (PUBL)
▇▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
Attention: RVIC STBNL 647
o 20 o
U.S.$275,000,000
Facility Agreement dated o 2001
-------------------------------
We refer to the above Facility Agreement and hereby give you notice that we wish
to draw an Advance of $o on o 20o [and select a Term in respect thereof of o
months]. The funds should be credited to [NAME AND NUMBER OF ACCOUNT] with [NEW
YORK CITY].
We confirm that the borrowing to be effected by such 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 Facility Agreement shall have the same
meanings where used herein.
For and on behalf of
STENA INTERNATIONAL B.V.
......................
-157-
SCHEDULE 5
----------
Conditions Precedent
--------------------
(referred to in Clause 14.1)
1. Facility Agreement and Guarantees
1.1 Originals of this Agreement executed by all of the parties hereto (in
sufficient copies so that each Bank will be able to retain one original
for itself).
1.2 Original Shipowner's Guarantees executed by each of the Shipowners
(other than Scandlines).
1.3 An original Port Owner's Guarantee executed by Stena Line Ports.
2. The Ships and Linkspans
2.1 Such evidence as the Agent may require in respect of each Ship that
such Ship (and, where appropriate, each of its associated Linkspans)
is:-
(A) registered in the sole name of the relevant Shipowner shown in
Schedule 2 free from all Liens except for Permitted Ship Liens;
(B) classified 1A1 with its Classification Society;
(C) technically managed by its Approved Manager (if any); and
(D) (together with its operator) compliant with the requirements of
the ISM Code.
2.2 Written confirmation from the insurance brokers and the managers of any
protection and indemnity or war risks association through whom any
Insurances of a Ship or Linkspan have been placed that they will each
issue a letter of undertaking in a form acceptable to the Agent upon
receipt of the Notice(s) of Assignment of Insurances relating to such
Ship or Linkspan.
2.3 Originals of the Security Documents to be entered into in respect of
each Ship and Linkspan duly executed by the Security Parties which are
party thereto together with all relevant notices, acknowledgements and
other ancillary documents to be executed thereunder or pursuant
thereto, namely:-
(A) in the case of m.v.'s "STENA ▇▇▇▇▇▇", "STENA SCANDINAVICA",
"STENA FREIGHTER", "STENA SCANRAIL", "STENA CARRIER", "STENA
CARISMA", "LINKSPAN I", "LINKSPAN II" and "STENA GOTHICA":-
(i) first priority instruments of pledge in the form set out in
Schedule 8 executed by the relevant Shipowner in respect of
the Swedish law ship mortgages thereon registered or to be
registered against each of the above Ships and Linkspans in
the following amounts:-
-158-
Ship Amount
---- -------
"STENA ▇▇▇▇▇▇" $57,000,000
"STENA SCANDINAVICA" $115,000,000
"STENA FREIGHTER" $12,570,000
"STENA SCANRAIL" $8,000,000
"STENA CARISMA" $62,500,000
"LINKSPAN I" $4,000,000
"LINKSPAN II" $3,000,000
"STENA CARRIER" $8,500,000
"STENA GOTHICA" $14,437,500
(ii) the original mortgage deeds as referred to in (i) above in
respect of each of the above Ships and Linkspans; and
(iii) a Deed of Covenant and Notices of Assignment of Insurances
in the form of Schedule 1 thereto each executed by the
relevant Shipowner in respect thereof;
(B) in the case of m.v.'s "STENA EUROPE", "STENA SEARIDER", "STENA
SEATRADER" and "KONINGIN BEATRIX":-
(i) a first priority statutory ship mortgage thereon
incorporating the text set out in Schedule 10 executed by
the relevant Shipowner;
(ii) a Deed of Covenant and Notices of Assignment of Insurances
in the form of Schedule 1 thereto executed by the relevant
Shipowner in respect thereof;
(C) in the case of m.v. "STENA GERMANICA":-
(i) the Stena Germanica Assignment;
(ii) the notice of assignment in the form of Schedule 1 to the
Stena Germanica Assignment executed by the Borrower and the
acknowledgement thereof in the form of Schedule 2 to the
Stena Germanica Assignment executed by Scandlines;
(iii) the notice of assignment in the form of Schedule 3 to the
Stena Germanica Assignment executed by the Borrower and the
acknowledgement thereof in the form of Schedule 4 to the
Stena Germanica Assignment executed by Stena Line
Scandinavia;
(iv) the Notice of Assignment of Insurances in the form of
Schedule 5 to the Stena Germanica Assignment executed by the
Borrower;
(D) in the case of each of the Mortgaged Ships and Mortgaged
Linkspans:-
(i) the Charterer's Insurance Assignment (if any) executed by
any Stena Charterer of such Ship or Linkspan;
-159-
(ii) the Charterer's Subordination Undertaking (if any) executed
by any Stena Charterer of such Ship or Linkspan;
(iii) the Manager's Subordination Undertaking (if any) executed
by any Approved Manager of such Ship or Linkspan.
2.4 In the case of each Ship and Linkspan, evidence that the relevant
mortgage in favour of the Security Agent on such Ship or Linkspan has
been registered against such Ship or Linkspan with first priority at
the appropriate ship registry.
3. Holyhead Port
3.1 A clear H.M. Land Registry search in favour of the Security Agent
against such part of Holyhead Port as is registered or is in the course
of registration, with priority expiring no earlier than twenty eight
(28) days after the Availability Date.
3.2 An original of the Holyhead Charge executed by Stena Line Ports.
3.3 A certificate of title in respect of Holyhead Port (including
details of the insurances of the relevant port) in form and substance
acceptable to the Agent.
4. Stranraer Port
4.1 A clear search in the property register and in the computerised
presentment book in respect of Stranraer Port to be continued to a date
twenty two (22) days after the date of recording of the Stranraer
Charge and a clear search in the personal register in respect of Stena
Line Ports.
4.2 An original of the Stranraer Charge executed by Stena Line Ports.
4.3 A certificate of title in respect of Stranraer Port (including details
of the insurances of the relevant port) in form and substance
acceptable to the Agent.
5. Constitutional documents
Certified copies of the Certificate of Incorporation and Memorandum and
Articles of Association or equivalent constitutive documents of the
Borrower and each other Security Party.
6. Corporate authorisations
6.1 Certified copies of resolutions of each Security Party approving the
Security Documents to which such Security Party is a party and
approving the transactions contemplated thereby and authorising the
execution of such documents by an officer or attorney of the relevant
Security Party.
6.2 Original or certified copies of the powers of attorney, if any, issued
pursuant to the resolutions referred to above.
-160-
7. Certificate of incumbency
Certified copies of a certificate of incumbency or extract from the
commercial register in respect of the Borrower and each other Security
Party.
8. Consents and approvals
Such evidence as the Agent may require that all such consents have been
obtained as may be required from any authority by each of the Borrower
and each other Security Party for the execution of and performance by
them of their respective obligations under those of the Security
Documents to which they are respectively a party.
9. Fees
9.1 The agency fee letter agreement referred to in Clause 6.1 executed by
the Borrower, Stena AB and Svenska Handelsbanken AB (publ).
9.2 The arrangement fee letter agreement referred to in Clause 6.3 executed
by the Borrower and the Agent.
9.3 Evidence that such fees referred to in Clause 6 as are payable on or
before the Availability Date have been received by the Agent.
10. Insurance opinion
An opinion on the Insurances by HSBC Insurance Brokers Limited dated
not more than thirty (30) days before the Availability Date, such
report to be in form and substance acceptable to the Agent.
11. Legal opinions
Legal opinions in form and substance acceptable to the Agent (or
confirmation satisfactory to the Agent that such legal opinions will be
issued in form and substance acceptable to it) from:-
(A) Messrs. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & Temperley concerning such matters of
English law as the Agent may reasonably require;
(B) Messrs. ▇▇▇▇▇▇▇▇▇▇ Swartling concerning such matters of Swedish
law as the Agent may reasonably require;
(C) Messrs. Loyens & Loeff concerning such matters of Netherlands law
as the Agent may reasonably require; and
(D) Messrs. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ concerning such matters of
Scottish law as the Agent may reasonably require.
12. Valuations
Valuations of the Mortgaged Ships, such valuations to be determined in
accordance with Clause 5.3(G).
-161-
13. Financial condition
Evidence that there is no breach of the asset coverage test contained
in Clause 10.21.
14. Process agent
Written confirmation from Stena (UK) Limited that it will act as the
process agent for service of process in England of the Borrower and
each other Security Party.
15. Commercial Documents
15.1 A certified copy of the Stena Germanica Loan Agreement as amended and
transferred out of the name of Stena Line into the name of the Borrower
as lender to Scandlines thereunder, such agreement to be on terms
whereby the principal loan amount outstanding thereunder is $52,000,000
and the repayment date thereof falls after the Termination Date
hereunder.
15.2 Certified copies of the Stena Germanica Mortgage and the Stena
Germanica Deed of Covenants together with certified copies of the
agreement or agreements by which such documents have been assigned from
Stena Line to the Borrower (including all appropriate notices and
acknowledges of assignment given to and/or by Scandlines and Stena Line
Scandinavia), all such documents to be in form and substance acceptable
to the Agent.
15.3 Certified copies of the Stena Germanica Charterer's Insurance
Assignment and the Stena Germanica Charterer's Subordination
Undertaking.
15.4 Certified copy of the Stena Line Asset Purchase Agreement.
15.5 Certified copies of the other Commercial Documents.
16. Cancellation of Stena Line Revolving Credit Facility
Evidence that simultaneously with drawdown of the first Advance all
outstandings in respect of the Stena Line Revolving Credit Facility
will be repaid in full and such facility finally and irrevocably
cancelled.
-162-
SCHEDULE 6
----------
Form of Transfer Certificate
----------------------------
(referred to in Clause 20.3)
Transfer Certificate
--------------------
Banks are advised not to employ Transfer Certificates or otherwise to assign or
transfer interests in the Facility Agreement without further ensuring that the
transaction complies with all applicable laws and regulations, including the
Financial Services ▇▇▇ ▇▇▇▇ and regulations made thereunder and similar statutes
which may be in force in other jurisdictions
To: Svenska Handelsbanken AB (publ), as agent on its own behalf and for
and on behalf of the Borrower, the Security Agent, the Banks, the
Co-Arrangers and Stena AB defined in the Facility Agreement referred
to below.
o 20 o
Attention: RVIC STBNL 647
This certificate ("TRANSFER CERTIFICATE") relates to a US$275,000,000 facility
agreement dated 2001 (as amended, novated and/or restated from time to
time the "FACILITY AGREEMENT") and made between (1) Stena International B.V.
(the "BORROWER"), (2) the banks and financial institutions defined therein as
banks (the "BANKS"), (3) ▇. ▇. ▇▇▇▇▇▇ plc, Nordbanken AB (publ) and Svenska
Handelsbanken AB (publ) as Co-Arrangers, (4) Svenska Handelsbanken AB (publ) as
Agent, (5) Svenska Handelsbanken AB (publ) as Security Agent and (6) Stena AB as
guarantor for a facility of up to $275,000,000. Terms defined in the Facility
Agreement shall, unless otherwise defined herein, have the same meanings herein
as therein. In this Certificate:
the "TRANSFEROR" means [FULL NAME] of [LENDING OFFICE]; and
the "TRANSFEREE" means [FULL NAME] of [LENDING OFFICE].
1. The Transferor as beneficial owner assigns to the Transferee absolutely
all rights and interests (present, future or contingent) which the
Transferor has as Bank under or by virtue of the Facility Agreement and
all the Security Documents in relation to [ ] per centum ([ ]%) of the
Contribution of the Transferor (or its predecessors in title) which are
set out below:-
Date of Contribution Amount Maturity Date
-------------------- ------ -------------
2. By virtue of this Transfer Certificate and Clause 20 of the Facility
Agreement, the Transferor is discharged [entirely from its Available
Commitment which amounts to $[ ]][from [ per centum (
[ ]%) of its Available Commitment, which percentage represents
$[ ]].
-163-
3. [The Transferee acknowledges that the Contribution of the Transferor
referred to in Clause 1 above relates to Advances having Maturity Dates
which fall after the date hereof which have been funded as to its
relevant portion by the Transferor and in respect of which the
Transferor has incurred and continues to incur funding costs at an
annual rate of interest per annum approximate to the relevant rate of
LIBOR for each such Advance as determined by the Agent prior to the
drawdown thereof. In consider of the Transferor agreeing to execute
this Transfer Certificate in favour of the Transferee, the Transferee
undertakes that upon the Maturity Date of each such Advance, the
Transferee will pay to the Transferor a sum in Dollars for value on
such Maturity Date equal to the aggregate of:-
(A) the amount of principal repaid to the Transferee under the
Facility Agreement in respect of the relevant portion of such
Advance transferred by the Transferor to the Transferee
hereunder;
(B) the amount of all interest earned and received by the Transferee
under the Facility Agreement in respect of the relevant portion
of such Advance transferred by the Transferor to the Transferee
hereunder which is attributable to LIBOR (i.e. so that it
excludes that part of such interest which is attributable to the
Margin); and
(C) the amount of all interest earned and received by the Transferee
under the Facility Agreement in respect of the relevant portion
of such Advance transferred by the Transferor to the Transferee
hereunder which is earned during the period from its drawdown
date up to (but not including) the date of this Transfer
Certificate and which is attributable to the Margin.
By its execution and delivery of this Transfer Certificate the
Transferee hereby irrevocably and unconditionally authorises and
instructs the Agent to effect on its behalf the payments to be made to
the Transferor as referred to in this Clause from the corresponding
payments of interest and repayment of principal received by it on
behalf of the Banks under the Facility Agreement.]
4. The Transferee hereby requests the Borrower, the Agent, the Security
Agent, the Banks and Stena AB to accept the executed copies of this
Transfer Certificate as being delivered pursuant to and for the
purposes of Clause 20.3 of the Facility Agreement so as to take effect
in accordance with the terms thereof on [DATE OF TRANSFER].
5. The Transferee:-
(A) confirms that it has received a copy of the Facility Agreement
and the Security Documents together with such other documents and
information as it has required in connection with the transaction
contemplated thereby;
(B) confirms that it has not relied and will not hereafter rely on
the Transferor, the Agent or the Security Agent to check or
enquire on its behalf into the legality, validity, effectiveness,
adequacy, accuracy or completeness of the Facility Agreement, any
of the Security Documents or any such documents or information;
-164-
(C) agrees that it has not relied and will not rely on the
Transferor, the Agent, the Security Agent, the Co-Arrangers or
the Banks to assess or keep under review on its behalf the
financial condition, creditworthiness, condition, affairs, status
or nature of the Borrower or any other Security Party (save as
otherwise expressly provided therein);
(D) warrants that it has power and authority to become a party to the
Facility Agreement and has taken all necessary action to
authorise execution of this Transfer Certificate and to obtain
all necessary approvals and consents to the assumption of its
obligations under the Facility Agreement and the Security
Documents; and
(E) if not already a Bank, appoints the Agent to act as its agent and
the Security Agent to act as its trustee as provided in the
Facility Agreement and the Security Documents and agrees to be
bound by the terms of the Facility Agreement.
6. The Transferor:-
(A) warrants to the Transferee that it has full power to enter into
this Transfer Certificate and has taken all corporate action
necessary to authorise it to do so;
(B) warrants to the Transferee that this Transfer Certificate is
binding on the Transferor under the laws of England, the country
in which the Transferor is incorporated and the country in which
its lending office is located; and
(C) agrees that it will, at its own expense, execute any documents
which the Transferee reasonably requests for perfecting in any
relevant jurisdiction the Transferee's title under this Transfer
Certificate or for a similar purpose.
7. The Transferee hereby undertakes with the Transferor and each of the
other parties to the Facility Agreement and the other Security
Documents that it will perform in accordance with its terms all those
obligations which by the terms of the Facility Agreement and the other
Security Documents will be assumed by it after delivery of the executed
copies of this Transfer Certificate to the Agent and satisfaction of
the conditions (if any) subject to which this Transfer Certificate is
expressed to take effect.
8. By execution of this Transfer Certificate on their behalf by the
Agent and in reliance upon the representations and warranties of the
Transferee, the Borrower, Stena AB, the Agent, the Security Agent, the
Co-Arrangers and the Banks accept the Transferee as a party to the
Facility Agreement and the Security Documents with respect to all
those rights and/or obligations which by the terms of the Facility
Agreement and the Security Documents will be assumed by the Transferee
(including those about pro-rata sharing and the exclusion of liability
on the part of, and the indemnification of, the Agent, the
Co-Arrangers, the Security Agent and the Banks as provided by the
Agreement) after delivery of the executed copies of this Transfer
Certificate to the Agent and satisfaction of the conditions (if any)
subject to which this Transfer Certificate is expressed to take
effect.
-165-
9. None of the Transferor, the Agent, the Security Agent, the Co-Arrangers
or the Banks:-
(A) makes any representation or warranty nor assumes any
responsibility with respect to the legality, validity,
effectiveness, adequacy or enforceability of the Facility
Agreement or any of the Security Documents or any document
relating thereto;
(B) assumes any responsibility for the financial condition of the
Borrower or any other Security Party or any party to any such
other document or for the performance and observance by the
Borrower or any other Security Party or any party to any such
other document (save as otherwise expressly provided therein) and
any and all such conditions and warranties, whether express or
implied by law or otherwise, are hereby excluded (except as
aforesaid).
10. The Transferor and the Transferee each undertake that they will on
demand fully indemnify the Agent and the Security Agent in respect of
any claim, proceeding, liability or expense which relates to or results
from this Transfer Certificate or any matter concerned with or arising
out of it unless caused by the Agent's or Security Agent's gross
negligence or wilful misconduct, as the case may be.
11. The agreements and undertakings of the Transferee in this Transfer
Certificate are given to and for the benefit of and made with each of
the other parties to the Facility Agreement and the Security Documents.
12. This Transfer Certificate shall be governed by, and construed in
accordance with, English law.
Transferor Transferee
[INSERT TRANSFEROR'S NAME] [INSERT TRANSFEREE'S NAME]
By: By:
Dated: Dated:
Agent
Agreed for and on behalf of itself as Agent,
the Co-Arrangers, the Security Agent,
the Banks, the Borrower, Stena AB and
each other Security Party.
SVENSKA HANDELSBANKEN AB (PUBL)
By:
Dated:
-166-
NOTE: The execution of this Transfer Certificate alone may not transfer
a proportionate share of the Transferor's interest in the security
constituted by the Security Documents in the Transferor's or
Transferee's jurisdiction. It is the responsibility of each
individual Bank to ascertain whether any other documents are
required to perfect a transfer of such a share in the Transferor's
interest in such security in any such jurisdiction and, if so, to
seek appropriate advice and arrange for execution of the same.
-167-
THE SCHEDULE
------------
Outstanding Contributions of Transferor : $[ ]
---------------------------------------
Available Commitment of Transferor : $[ ]
----------------------------------
Portion Transferred : [ ]%
-------------------
ADMINISTRATIVE DETAILS OF TRANSFEREE
------------------------------------
Name of Transferee:
Lending Office:
Contact person
(Loan Administration Department):
Telephone:
Fax:
Contact person
(Credit Administration Department):
Telephone:
Fax:
Account for payments:
-168-
SCHEDULE 7.1
------------
Form of Shipowner's Guarantee
-----------------------------
-169-
SCHEDULE 7.2
------------
Form of Port Owner's Guarantee
------------------------------
-170-
SCHEDULE 8
----------
Form of Swedish Mortgage
------------------------
-171
SCHEDULE 9
----------
Form of Insurance Assignment
----------------------------
-172-
SCHEDULE 10
-----------
Form of Statutory Mortgage Narrative
------------------------------------
-173-
SCHEDULE 11.1
-------------
Form of Deed of Covenant
------------------------
-174-
SCHEDULE 11.2
-------------
Form of Deed of Covenant (m.v. "STENA CARISMA" AND HER RELATED LINKSPANS)
-------------------------------------------------------------------------
-175-
SCHEDULE 12
-----------
Form of Charterer's Insurance Assignment
----------------------------------------
-176-
SCHEDULE 13
-----------
Form of Charterer's Subordination Undertaking
---------------------------------------------
-177-
SCHEDULE 14
-----------
Form of Holyhead Charge
-----------------------
-178-
SCHEDULE 15
-----------
Form of Stranraer Charge
------------------------
-179-
SCHEDULE 16
-----------
Form of Receivables Assignment (Credit Sale)
--------------------------------------------
-180-
SCHEDULE 17
-----------
Form of Receivables Assignment (Hire Purchase)
----------------------------------------------
-181-
SCHEDULE 18
-----------
Form of Manager's Subordination Undertaking
-------------------------------------------
-182-
SCHEDULE 19
-----------
Form of Stena Germanica Assignment
----------------------------------
-183-
SCHEDULE 20
-----------
Specimen Charter Covenants and Loss Payable Clauses
---------------------------------------------------
-184-
SCHEDULE 21
-----------
Form of Asset Coverage Compliance Certificate
---------------------------------------------
OFFICER'S CERTIFICATE ISSUED PURSUANT TO A
$275,000,000 FACILITY AGREEMENT DATED [O] 2001 (THE "FACILITY AGREEMENT")
I, [o], the [Chief Financial Officer/DESCRIBE OFFICE] of Stena AB, hereby
certify that:-
1. Attached hereto is a statement of the respective amounts of:-
o Appraised Value of Restricted Group Assets
o Secured Debt
o Strategic Investments
o Cash and Marketable Securities
o Net Market Value of the Unrestricted Group
o Other Assets and Working Capital
o Available Asset Value
o Unsecured Debt
as at [30 June/31 December/OTHER [YEAR]] (the "REFERENCE DATE"),
determined in accordance with Clause 10.21 of the Facility Agreement.
2. As at the Reference Date, the ratio of Available Asset Value to
Unsecured Debt was [INSERT]:1.
3. Attached hereto is a statement of the amounts of the values of the
assets of the Stena AB Group determined in accordance with Clause 10.21
of the Facility Agreement for the purpose of calculating the Available
Asset Value as at the Reference Date.
Terms used herein and not otherwise defined herein shall have the meanings set
forth in the Facility Agreement. This certificate is rendered pursuant to Clause
10.2(F) of the Facility Agreement.
IN WITNESS WHEREOF, the undersigned has set his hand this o day of o 20o.
STENA AB
By: ............................
[Chief Financial Officer/INSERT OFFICE]
-185-
The Borrower
------------
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
STENA INTERNATIONAL B.V.
in the presence of:
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
The Agent and Security Agent
----------------------------
SIGNED AND DELIVERED AS A DEED by
/s/ Sten - ▇▇▇▇ ▇▇▇▇▇▇
attorney-in-fact for and on behalf of
SVENSKA HANDELSBANKEN AB (PUBL)
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
London EC2V 7LE
The Banks and Co-Arrangers
--------------------------
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of
THE CHASE MANHATTAN BANK
(or successor or nominated affiliate thereof)
by its authorised signatory
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
NORDBANKEN AB (PUBL)
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ Sten - ▇▇▇▇ ▇▇▇▇▇▇
attorney-in-fact for and on behalf of
SVENSKA HANDELSBANKEN AB (PUBL)
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
-186-
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of
▇.▇. ▇▇▇▇▇▇ PLC
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇
for and on behalf of
HSBC BANK PLC
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by )
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇ )
attorney-in-fact for and on behalf of )
LANDESBANK SCHLESWIG-HOLSTEIN )
GIROZENTRALE )
in the presence of:- )
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
DEN NORSKE BANK ASA
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
-187-
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of
SCOTIABANK EUROPE PLC
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
SKANDINAVISKA ENSKILDA ▇▇▇▇▇▇ ▇▇ (PUBL)
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
ABN AMRO BANK N.V.
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SIGNED AND DELIVERED AS A DEED by
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
attorney-in-fact for and on behalf of
NEDSHIP BANK (NORDIC)
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Stena AB
--------
SIGNED AND DELIVERED AS A DEED by
/s/ Rolf Mahlkvist
attorney-in-fact for and on behalf of
STENA AB
in the presence of:-
/s/ ▇▇▇▇▇ ▇▇▇
Trainee Solicitor
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇