Exhibit 4.1

 

Private and Confidential

Execution version

 

 

 

	Dated 16 July 2020

 

 

THE ENTITIES LISTED IN SCHEDULE 1
as Borrowers

 

BNP PARIBAS

 

and

 

CREDIT SUISSE AG

 

as mandated lead arrangers
(together as Arrangers)

 

with

 

BNP PARIBAS
as Agent

 

BNP PARIBAS
as Security Agent

 

BNP PARIBAS

 

and

 

CREDIT SUISSE AG
as Global Co-ordinators and Bookrunners

 

guaranteed by
GASLOG PARTNERS LP
and
GASLOG PARTNERS HOLDINGS LLC

 

 

 

 

 

 

 

 

FACILITY AGREEMENT

for

$260,331,250 Loan Facilities

 

 

 

 

 

Contents

 

Clause		Page
1	Definitions and interpretation	1
2	The Facility	24
3	Purpose	27
4	Conditions of Utilisation	27
5	Utilisation	28
6	Repayment	29
7	Illegality, prepayment and cancellation	29
8	Interest	35
9	Interest Periods	35
10	Changes to the calculation of interest	36
11	Fees	37
12	Tax gross-up and indemnities	38
13	Increased Costs	42
14	Other indemnities	43
15	Mitigation by the Lenders	46
16	Costs and expenses	47
17	Guarantee and indemnity	48
18	Representations	51
19	Information undertakings	58
20	Financial covenants	62
21	General undertakings	64
22	Dealings with Ship	69
23	Condition and operation of Ship	73
24	Insurance	76
25	Minimum security value	80
26	Chartering undertakings	83
27	Bank accounts	85

 

 

THIS AGREEMENT is dated 16 July 2020, and made between:

 

(1)        THE ENTITIES listed in Schedule 1 (The original parties) as borrowers (the Borrowers);

 

(2)        GASLOG PARTNERS LP (the Parent);

 

(3)        GASLOG PARTNERS HOLDINGS LLC (GasLog Holdings);

 

(4)        BNP PARIBAS and CREDIT SUISSE AG as mandated lead arrangers (whether acting individually or together, the Arrangers);

 

(5)        THE FINANCIAL INSTITUTIONS listed in Schedule 1 (The original parties) as lenders (the Original Lenders);

 

(6)        BNP PARIBAS and CREDIT SUISSE AG  as global co-ordinator of the Finance Parties (whether acting individually or together, the Global Co-ordinator);

 

(7)        BNP PARIBAS and CREDIT SUISSE AG as bookrunners (whether acting individually or together, the Bookrunner);

 

(8)        BNP PARIBAS as Agent of the other Finance Parties (the Agent); and

 

(9)        BNP PARIBAS as security agent and trustee for and on behalf of the other Finance Parties (the Security Agent).

 

IT IS AGREED as follows:

 

1      Definitions and interpretation

 

1.1       Definitions

 

In this Agreement and (unless otherwise defined in the relevant Finance Document) the other Finance Documents:

 

Acceptable Bank means:

 

(a)        a bank or financial institution which has a rating for its long-term unsecured and non-credit enhanced debt obligations of “A-” or higher by Standard & Poor’s Rating Services or Fitch Ratings Ltd or “Baa1” or higher by Moody’s Investor Services Limited or a comparable rating from another internationally recognised credit rating agency; or

 

(b)       any other bank or financial institution approved by the Majority Lenders,

 

and which is approved by the Borrowers.

 

Account means any bank account, deposit or certificate of deposit opened, made or established in accordance with clause 27 (Bank accounts).

 

Account Bank means, in relation to any Account, BNP Paribas (Suisse) S.A., a Swiss société anonyme acting through its office at Place de Hollande 2, CP CH-1211, Geneva 11, Switzerland or another bank or financial institution approved by the Majority Lenders at the request of the Borrowers.

 

Account Holder(s) means, in relation to any Account, the Obligor(s) in whose name(s) that Account is held.

 

Account Security means, in relation to an Account, a deed or other instrument executed by the relevant Account Holder(s) in favour of the Security Agent and/or any other Finance Parties in an agreed form conferring a Security Interest over that Account.

 

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Accounting Reference Date means 31 December or such other date as may be approved by the Majority Lenders.

 

Advance A means the advance of the Ship Commitment in respect of Ship A, being in an amount of up to the lesser of (a) $41,800,000 and (b) 55 per cent of the market value of Ship A, as determined in accordance with clause 25 (Minimum Security Value).

 

Advance B means the advance of the Ship Commitment in respect of Ship B, being in an amount of up to the lesser of (a) $108,675,000 and (b) 67.5 per cent of the market value of Ship B, as determined in accordance with clause 25 (Minimum Security Value).

 

Advance C means the advance of Ship Commitment in respect of Ship C, being in an amount up to the lesser of (a) $109,856,250 and (b) 67.5 per cent of the market value of Ship C, as determined in accordance with clause 25 (Minimum Security Value).

 

Advances means Advance A, Advance B and Advance C and Advance means any of them.

 

Affiliate means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company.

 

Agent includes any person who may be appointed as agent for the other Finance Parties under clause 32.12 (Resignation of the Agent) or any other provision of this Agreement.

 

Annual Financial Statements has the meaning given to it in clause 19 (Information undertakings).

 

Approved Brokers means each of Clarksons, Braemar Seascope Ltd, Fearnleys AS, Simpson, Spence & Young Ltd and Poten & Partners or any other independent firm of shipbrokers agreed in writing from time to time between the Borrowers and the Agent (acting on the instructions of the Majority Lenders), unless any such person is a or becomes a Prohibited Person or otherwise is in breach of Sanctions.

 

Approved Exchange means NYSE or NASDAQ or any other national stock exchange acceptable to the Majority Lenders.

 

Approved Flag State means each of Bermuda, Cayman Islands, Cyprus, Hellenic Republic, Hong Kong, Malta, Marshall Islands, Singapore and the United Kingdom.

 

Auditors means one of PricewaterhouseCoopers, Ernst & Young, KPMG or Deloitte & Touche or another firm proposed by the Borrowers and approved by the Majority Lenders from time to time (provided that if the approval of Auditors as set out in this definition becomes contrary to any applicable law, directive or regulation, and the Majority Lenders so require, the Obligors agree that they will make such amendment to this definition as will be agreed between the Borrower and the Majority Lenders so as to ensure compliance with such law, directive or regulation).

 

Available Facility means, at any relevant time, such part of the Total Commitments (drawn and undrawn) which is available for borrowing under this Agreement at such time in accordance with clause 4 (Conditions of Utilisation) to the extent that such part of the Total Commitments is not cancelled or reduced under this Agreement.

 

Basel II Accord means the “International Convergence of Capital Measurement and Capital Standards, a Revised Framework” published by the Basel Committee on Banking Supervision in June 2004 as updated prior to, and in the form existing on, the date of this Agreement, excluding any amendment thereto arising out of the Basel III Accord or Reformed Basel III.

 

Basel II Approach means, in relation to any Finance Party, either the Standardised Approach or the relevant Internal Ratings Based Approach (each as defined in the Basel II Regulations applicable to such Finance Party) adopted by that Finance Party (or any of its Affiliates) for the purposes of implementing or complying with the Basel II Accord.

 

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Basel II Regulation means:

 

(a)        any law or regulation in force as at the date hereof implementing the Basel II Accord (including the relevant provisions of CRD IV and CRR) to the extent only that such law or regulation re-enacts and/or implements the requirements of the Basel II Accord but excluding any provision of such law or regulation implementing the Basel III Accord; and

 

(b)        any Basel II Approach adopted by a Finance Party or any of its Affiliates.

 

Basel III Accord means, together:

 

(a)        the agreements on capital requirements, a leverage ratio and liquidity standards contained in “Basel III: A global regulatory framework for more resilient banks and banking systems”, “Basel III: International framework for liquidity risk measurement, standards and monitoring” and “Guidance for national authorities operating the countercyclical capital buffer” published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated on or before the date of this Agreement;

 

(b)       the rules for global systemically important banks contained in “Global systemically important banks: assessment methodology and the additional loss absorbency requirement - Rules text” published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated on or before the date of this Agreement; and

 

(c)        any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III on or before the date of this Agreement”.

 

Basel III Increased Cost means an Increased Cost which is attributable to the implementation or application of or compliance with any Basel III Regulation (whether such implementation, application or compliance is by a government, regulator, Finance Party or any of its Affiliates).

 

Basel III Regulation means any law or regulation implementing the Basel III Accord (including the relevant provisions of CRD IV and CRR) save to the extent that such law or regulation re-enacts a Basel II Regulation and excluding any such law or regulation which implements Reformed Basel III.

 

Break Costs means the amount (if any) by which:

 

(a)        the interest (excluding the Margin) which a Lender should have received for the period from the date of receipt of all or any part of its participation in an Advance or Unpaid Sum to the last day of the current Interest Period in respect of that Advance or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period;

 

exceeds:

 

(b)        the amount which that Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank in the Interbank Market for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period.

 

Business Day means a day (other than a Saturday or Sunday) (a) which is not a public holiday in Athens and (b) on which banks are open for general business in Basel, Geneva, London, Paris, Zurich and Tokyo and (c) (in relation to any date for payment or purchase of dollars) New York.

 

Cash Collateral Account means, to the extent required pursuant to clause 29.20(a)(ii) (Charters), each of the interest bearing dollar accounts of a Borrower with the Account Bank

 

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designated as a Cash Collateral Account under clause 27 (Bank accounts), and Cash Collateral Accounts means all of them.

 

Change of Control occurs if:

 

(a)        a person or persons, acting in concert (other than the Permitted Holders or any of them) have or acquire the right or the ability to control, either directly or indirectly, the affairs or composition of the majority of the board of directors (or equivalent) of GasLog;

 

(b)        the Parent ceases to control, directly or indirectly, the affairs or the composition of the board of directors (or equivalent) of any of the Borrowers or GasLog Holdings;

 

(c)        GasLog ceases to control, directly or indirectly, the affairs or the composition of the board of directors (or equivalent) of any of the Parent or GasLog Holdings;

 

(d)        GasLog Holdings ceases to control, directly or indirectly, any Borrower;

 

(e)        GasLog Holdings ceases to be a wholly-owned subsidiary of the Parent;

 

(f)         less than 50.1% of the issued and outstanding shares (including the voting shares) of any Borrower are legally and beneficially owned or controlled, directly or indirectly, by the Parent; or

 

(g)        any of the issued and outstanding shares (including the voting shares) of GP LLC cease to be legally and beneficially owned by GasLog or GP LLC ceases to be the general partner of the Parent,

 

in any case without the prior written consent of the Agent (acting on the instructions of the Majority Lenders).

 

Charged Property means all of the assets of the Obligors which from time to time are, or are expressed or intended to be, the subject of the Security Documents.

 

Charter means, in relation to a Ship, the charter commitment (if any) for that Ship details of which are provided in Schedule 2 (Ship information), as it may from time-to-time be amended or replaced in the circumstances and as permitted in accordance with clause 29.20(b) (Charters).

 

Charter Assignment means, in relation to a Ship and its Charter Documents, an assignment by the relevant Owner of its interest in such Charter Documents in favour of the Security Agent in the agreed form.

 

Charter Documents means, in relation to a Ship, the Charter (if any) of that Ship, any documents supplementing it and any guarantee or security given by any person to the relevant Owner for the relevant Charterer’s obligations under it.

 

Charterer means, in relation to a Ship, the charterer named in Schedule 2 (Ship information) as charterer of that Ship, or such replacement charterer that is party to any Charter entered into in the circumstances and as permitted in accordance with clause 29.20(b) (Charters).

 

Classification means, in relation to a Ship, the classification specified in respect of such Ship in Schedule 2 (Ship information) with the relevant Classification Society or another classification approved by the Majority Lenders as its classification (such approval not to be unreasonably withheld), at the request of the relevant Owner.

 

Classification Society means, in relation to a Ship, the classification society specified in respect of such Ship in Schedule 2 (Ship information), DNV GL, American Bureau of Shipping and Lloyd’s Register of Shipping or another classification society being a member of the International Association of Classification Societies (IACS) or, if such association no longer exists, any similar association nominated by the Agent) approved by the Majority Lenders as its

 

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Classification Society (such approval not to be unreasonably withheld or delayed), at the request of the relevant Owner.

 

Code means the US Internal Revenue Code of 1986, as amended.

 

Commercial Manager means, in relation to a Ship, GasLog, GasLog LNG Services (whose appointment as Commercial Manager of the Ship shall be effective on and from the Utilisation Date) or another manager appointed as the commercial manager of that Ship by the relevant Owner in accordance with clause 22.3 (Manager).

 

Commitment means:

 

(a)        in relation to an Original Lender, the amount set opposite under its name opposite the heading “Commitment” in Schedule 1 (The original parties) and the amount of any other Commitment transferred to it under this Agreement; and

 

(b)       in relation to any other Lender, the amount of any Commitment transferred to it under this Agreement,

 

to the extent not cancelled, reduced or transferred by it under this Agreement.

 

Compliance Certificate means a certificate substantially in the form set out in Schedule 5 (Form of Compliance Certificate) or otherwise approved.

 

Confidential Information means all information relating to an Obligor, the Group, the Finance Documents, the Charter Documents or any other charter commitments (to the extent such information relating to such other charter commitments is confidential as a matter of law or contract) for each Ship or the Facility of which a Finance Party becomes aware in its capacity as, or for the purpose of becoming, a Finance Party or which is received by a Finance Party in relation to, or for the purpose of becoming a Finance Party under, the Finance Documents or the Facility from either:

 

(a)        any Group Member or any of its advisers; or

 

(b)        another Finance Party, if the information was obtained by that Finance Party directly or indirectly from any Group Member or any of its advisers,

 

in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that:

 

(i)         is or becomes public information other than as a direct or indirect result of any breach by that Finance Party of clause 43 (Confidentiality); or

 

(ii)        is identified in writing at the time of delivery as non-confidential by any Group Member or any of its advisers; or

 

(iii)       is known by that Finance Party before the date the information is disclosed to it in accordance with paragraphs (a) or (b) above or is lawfully obtained by that Finance Party after that date, from a source which is, as far as that Finance Party is aware, unconnected with the Group and which, in either case, as far as that Finance Party is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality.

 

Constitutional Documents means, in respect of an Obligor or a Manager (other than the Shell Technical Manager), such Obligor’s or Manager’s memorandum and articles of association, by-laws or other constitutional documents including as referred to in any certificate relating to an Obligor or a Manager delivered pursuant to Schedule 3 (Conditions precedent).

 

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CRD IV means the directive 2013/36/EU of the European Union on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms.

 

CRR means the regulation 575/2013 of the European Union on prudential requirements for credit institutions and investment firms.

 

Debt Purchase Transaction means, in relation to a person, a transaction where such person:

 

(a)        purchases by way of assignment or transfer;

 

(b)       enters into any sub-participation in respect of; or

 

(c)        enters into any other agreement or arrangement having an economic effect substantially similar to a sub-participation in respect of,

 

any Commitment or amount outstanding under this Agreement.

 

Deed of Covenant means, in relation to a Ship, a first deed of covenant (including a first assignment of its interest in the Ship’s Insurances, Earnings and Requisition Compensation) in respect of such Ship by the relevant Owner in favour of the Security Agent in the agreed form.

 

Default means an Event of Default or any event or circumstance which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of them) be an Event of Default.

 

Defaulting Lender means any Lender:

 

(a)        which has failed to make its participation in an Advance available or has notified the Agent that it will not make its participation in an Advance available by the Utilisation Date of that Advance in accordance with clause 5.4 (Lenders’ participation);

 

(b)       which has otherwise rescinded or repudiated a Finance Document; or

 

(c)        with respect to which an Insolvency Event has occurred and is continuing,

 

unless, in the case of paragraph (a) above:

 

(i)         its failure to pay is caused by:

 

(A)       administrative or technical error; or

 

(B)       a Payment Disruption Event; and,

 

payment is made within three (3) Business Days of its due date; or

 

(ii)        the Lender is disputing in good faith whether it is contractually obliged to make the payment in question.

 

Delegate means any delegate, agent, attorney, additional trustee or co-trustee appointed in writing by the Security Agent under the terms of any Finance Document.

 

Disposal Repayment Date means, in relation to:

 

(a)        a Total Loss of a Mortgaged Ship, the applicable Total Loss Repayment Date; or

 

(b)       a sale of a Mortgaged Ship by the relevant Owner, the date upon which such sale is completed by the transfer of title to the purchaser in exchange for payment of all or part of the relevant purchase price (and upon or immediately prior to such completion).

 

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Earnings means, in relation to a Ship and a person, all money at any time payable to that person for or in relation to the use or operation of such Ship including (without limitation) freight, hire and passage moneys, money payable to that person for the provision of services by or from such Ship or under any charter commitment, requisition for hire compensation, remuneration for salvage and towage services, demurrage and detention moneys and damages for breach and payments for termination or variation of any charter commitment and contributions of any nature whatsoever in respect of general average.

 

Earnings Account means each of the interest bearing dollar accounts of a Borrower with the Account Bank designated as an Earnings Account under clause 27 (Bank accounts), and Earnings Accounts means all of them.

 

Environmental Claims means:

 

(a)        enforcement, clean-up, removal or other governmental or regulatory action or orders or claims instituted or made pursuant to any Environmental Laws or resulting from a Spill; or

 

(b)       any claim made by any other person relating to a Spill.

 

Environmental Incident means any Spill from any vessel in circumstances where:

 

(a)        any Fleet Vessel or its owner, operator or manager may be liable for Environmental Claims arising from the Spill (other than Environmental Claims arising and fully satisfied before the date of this Agreement); and/or

 

(b)       any Fleet Vessel may be arrested or attached in connection with any such Environmental Claim.

 

Environmental Laws means all laws, regulations and conventions concerning pollution or protection of human health or the environment.

 

Event of Default means any event or circumstance specified as such in clause 29 (Events of Default).

 

Existing Indebtedness means, at any relevant time, the aggregate principal amounts owing by the Borrowers or any of them and secured on the Ships or any of them by way of first priority ship mortgage or mortgages, under one or more credit facilities as disclosed by or on behalf of the Borrowers to the Lenders prior to the date of this Agreement, together with interest thereon and any other amounts owing thereunder or in connection therewith.

 

Existing Indebtedness Lender means any bank, financial institution or other person, who is a lender of Existing Indebtedness.

 

Facility means the term loan facility made available under this Agreement as described in clause 2 (The Facility).

 

Facility Office means:

 

(a)        in respect of a Lender, the office or no more than two offices notified by that Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days’ written notice) as the office through which it will perform its obligations under this Agreement; and

 

(b)       in respect of any other Finance Party, the office in the jurisdiction in which it is resident for Tax purposes.

 

Facility Period means the period from and including the date of this Agreement to and including the date on which the Total Commitments have reduced to zero and all indebtedness of the Obligors under the Finance Documents has been irrevocably and unconditionally paid and discharged in full.

 

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FATCA means:

 

(a)        sections 1471 to 1474 of the Code or any associated regulations;

 

(b)       any treaty, law or a regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or

 

(c)        any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.

 

FATCA Application Date means:

 

(a)        in relation to a “withholdable payment” described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014;

 

(b)       in relation to a “passthru payment” described in section 1471(d)(7) of the Code not falling within paragraph (a) above, the date from which such payment may become subject to a deduction or withholding required by FATCA.

 

FATCA Deduction means a deduction or withholding from a payment under a Finance Document required by FATCA.

 

FATCA Exempt Party means a Party that is entitled to receive payments free from any FATCA Deduction.

 

Fee Letters means any letters entered into between (a) any Finance Parties and (b) any Obligors by reference to this Agreement in relation to any fees payable to any Finance Parties and Fee Letter means any one of them.

 

Final Repayment Date means the earlier of (a) subject to clause 35.7 (Business Days), the date falling five years from the first Utilisation Date and (b) 15 July 2025.

 

Finance Documents means this Agreement, any Fee Letter, any Quiet Enjoyment Agreement in relation to any Ship, the Security Documents, any Transfer Certificate and any other document designated as such by the Agent and the Borrowers.

 

Finance Party means the Agent, the Security Agent, the Global Co-ordinator, the Bookrunners, any Arranger or a Lender.

 

Financial Indebtedness means any indebtedness for or in respect of:

 

(a)        moneys borrowed and debit balances at banks or other financial institutions;

 

(b)       any amount raised by acceptance under any acceptance credit or bill discounting facility (or dematerialised equivalent);

 

(c)        any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

 

(d)       the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with GAAP, be treated as a finance or capital lease;

 

(e)        receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);

 

(f)        any Treasury Transaction (and, when calculating the value of that Treasury Transaction, only the marked to market value (or, if any actual amount is due as a result of the

 

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termination or close-out of that Treasury Transaction, that amount) shall be taken into account);

 

(g)       any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution;

 

(h)        any amount of any liability under an advance or deferred purchase agreement if (a) one of the primary reasons behind entering into the agreement is to raise finance or (b) the agreement is in respect of the supply of assets or services and payment is due more than 180 days after the date of supply;

 

(i)         any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing or otherwise classified as borrowings under GAAP; and

 

(j)         the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in paragraphs (a) to (i) above.

 

First Repayment Date means, in relation to each Advance, the date falling six months after the relevant Utilisation Date for such Advance, subject in each case, to clause 35.7 (Business Days).

 

Flag State means, in relation to a Ship, the country specified in respect of such Ship in Schedule 2 (Ship information), or another Approved Flag State (provided that the provisions of clause 22.1(b) (Ship’s name and registration) are complied with) or such other state or territory as may be approved by all the Lenders (acting reasonably), at the request of the relevant Owner, as being the Flag State of such Ship for the purposes of the Finance Documents.

 

Fleet Vessel means each Mortgaged Ship and any other vessel directly or indirectly owned, wholly or partly, by any Group Member.

 

Funding Rate means any individual rate notified by a Lender to the Agent pursuant to paragraph (a)(ii) of clause 10.3 (Cost of funds).

 

GAAP means International Accounting Standards, International Financial Reporting Standards and related interpretations as amended, supplemented, issued or adopted from time to time by the International Accounting Standards Board to the extent applicable to the relevant financial statements.

 

GasLog means GasLog Ltd. of Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.

 

GasLog Holdings means the company described as such in Schedule 1 (The original parties).

 

GasLog LNG Services means GasLog LNG Services Ltd. of Clarendon House, 2 Church Street, Hamilton HM11, Bermuda (being a wholly-owned subsidiary of GasLog).

 

General Assignment means, in relation to a Ship in respect of which the mortgage is not an account current form, a first assignment of its interest in the Ship’s Insurances, Earnings and Requisition Compensation by the relevant Owner in favour of the Security Agent and/or any of the other Finance Parties in the agreed form.

 

GP LLC means GasLog Partners GP LLC of Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960.

 

Group means the Parent and its Subsidiaries for the time being and, for the purposes of clause 19.1 (Financial statements) and clause 20 (Financial covenants), any other entity required to be treated as a subsidiary in Parent’s consolidated accounts in accordance with GAAP and/or any applicable law.

 

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Group Member means any Obligor and any other entity which is part of the Group.

 

Guarantee means the obligations of the Guarantors under clause 17 (Guarantee and indemnity).

 

Guarantors means the Parent and GasLog Holdings and Guarantor means either of them.

 

Holding Company means, in relation to a company or corporation or other person, any other company or corporation or other person in respect of which it is a Subsidiary.

 

Impaired Agent means the Agent at any time when:

 

(a)        it has failed to make (or has notified a Party that it will not make) a payment required to be made by it under the Finance Documents by the due date for payment;

 

(b)       the Agent otherwise rescinds or repudiates a Finance Document;

 

(c)        (if the Agent is also a Lender) it is a Defaulting Lender under paragraph (a) or (b) of the definition of Defaulting Lender; or

 

(d)       an Insolvency Event has occurred and is continuing with respect to the Agent,

 

unless, in the case of paragraph (a) above:

 

(i)         its failure to pay is caused by:

 

(A)       administrative or technical error; or

 

(B)       a Payment Disruption Event; and

 

payment is made within three (3) Business Days of its due date; or

 

(ii)        the Agent is disputing in good faith whether it is contractually obliged to make the payment in question.

 

Increased Costs has the meaning given to it in clause 13.1(b) (Increased costs).

 

Indemnified Person means:

 

(a)        each Finance Party, each Receiver, any Delegate and any other attorney, agent or other person appointed by them under the Finance Documents;

 

(b)       each Affiliate of each Finance Party, each Receiver and each Delegate; and

 

(c)        any officers, directors, employees, representatives or agents of each Finance Party, each Receiver and each Delegate.

 

Insolvency Event in relation to a Finance Party means that the Finance Party:

 

(a)        is dissolved (other than pursuant to a consolidation, amalgamation or merger);

 

(b)       becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due (in each case as determined in accordance with the laws applicable to such Finance Party);

 

(c)        makes a general assignment, arrangement or composition with or for the benefit of its creditors;

 

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(d)       institutes or has instituted against it, by a regulator, supervisor or any similar official with primary insolvency, rehabilitative or regulatory jurisdiction over it in the jurisdiction of its incorporation or organisation or the jurisdiction of its head or home office, a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation by it or such regulator, supervisor or similar official;

 

(e)        has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition is instituted or presented by a person or entity not described in paragraph (d) above and:

 

(i)         results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation; or

 

(ii)        is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof;

 

(f)        has exercised in respect of it one or more of the stabilisation powers pursuant to Part 1 of the Banking Act 2009 and/or has instituted against it a bank insolvency proceeding pursuant to Part 2 of the Banking Act 2009 or a bank administration proceeding pursuant to Part 3 of the Banking Act 2009;

 

(g)       has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger);

 

(h)        seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets;

 

(i)         has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter;

 

(j)         causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in paragraphs (a) to (i) above; or

 

(k)        takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.

 

Insurance Notice means, in relation to a Ship, a notice of assignment in the form scheduled to that Ship’s General Assignment or Deed of Covenant or in another approved form.

 

Insurances means, in relation to a Ship:

 

(a)        all policies and contracts of insurance; and

 

(b)       all entries in a protection and indemnity or war risks or other mutual insurance association,

 

in the name of such Ship’s Owner or the joint names of its Owner and any other person in respect of or in connection with such Ship and/or its Owner’s Earnings from the Ship and includes all benefits thereof (including the right to receive claims and to return of premiums).

 

Interbank Market means the London interbank market.

 

11

 

Interest Period means, in relation to an Advance, each period determined in accordance with clause 9 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with clause 8.3 (Default interest).

 

Interpolated Screen Rate means, in relation to LIBOR for an Interest Period with respect to any Advance or any part of it or any Unpaid Sum, the rate (rounded to the same number of decimal places as the two relevant Screen Rates) which results from interpolating on a linear basis between:

 

(a)        the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the relevant Interest Period of that Advance or the relevant Unpaid Sum; and

 

(b)       the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the relevant Interest Period of that Advance or the relevant Unpaid Sum,

 

each as of 11:00 a.m. (London time) on the relevant Quotation Day, and if that applicable interpolated rate is less than zero (0), the Interpolated Screen Rate shall be deemed to be zero (0).

 

Inventory of Hazardous Materials means, in relation to a Mortgaged Ship, a document describing the materials present in that Mortgaged Ship’s structure and equipment that may be hazardous to human health or the environment along with their respective location and approximate quantities.

 

Last Availability Date means the earlier of (a) 31 August 2020 and (b) the date falling two (2) months from the date of this Agreement.

 

Legal Opinion means any legal opinion delivered to the Agent and the Security Agent under clause 4 (Conditions of Utilisation).

 

Legal Reservations means:

 

(a)        the principle that equitable remedies may be granted or refused at the discretion of a court and the limitation of enforcement by laws relating to insolvency, reorganisation and other laws generally affecting the rights of creditors;

 

(b)       the time barring of claims under the Limitation Act 1980 and Foreign Limitation Periods Act 1984, the possibility that an undertaking to assume liability for, or indemnify a person against, non-payment of UK stamp duty may be void and defences of set-off or counterclaim;

 

(c)        similar principles, rights and defences under the laws of any Relevant Jurisdiction; and

 

(d)       any other matters which are set out as qualifications or reservations as to matters of law of general application in a Legal Opinion.

 

Lender means:

 

(a)        any Original Lender;

 

(b)       any bank, financial institution, trust, fund or other entity which has become a Party as a lender in accordance with clause 30 (Changes to the Lenders),

 

which in each case has not ceased to be a Lender in accordance with the terms of this Agreement, and Lenders mean all of them.

 

LIBOR means, in relation to any Advance or any part of it or any Unpaid Sum:

 

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(a)        the applicable Screen Rate as of 11:00 a.m. (London time) on the relevant Quotation Day for the currency of that Advance for a period equal in length to the Interest Period for that Advance or relevant part of it or Unpaid Sum; or

 

(b)       as otherwise determined pursuant to clause 10.1 (Unavailability of Screen Rate),

 

and if, in either case, that rate is less than zero, LIBOR shall be deemed to be zero.

 

Loan means the loan made or to be made under the Facility or the principal amount outstanding for the time being of that loan.

 

Loss Payable Clauses means, in relation to a Ship, the provisions concerning payment of claims under the Ship’s Insurances in the form scheduled to the Ship’s General Assignment or (as the case may be) Deed of Covenant or in another approved form.

 

Losses means any costs, expenses (including, but not limited to, legal fees), payments, charges, losses, demands, liabilities, taxes (including VAT) claims, actions, proceedings, penalties, fines, damages, judgments, orders or other sanctions.

 

Major Casualty means any casualty to a vessel for which the total insurance claim, inclusive of any deductible, exceeds or may exceed the Major Casualty Amount.

 

Major Casualty Amount means, in relation to a Ship, the amount specified as such against the name of that Ship in Schedule 2 (Ship information) or the equivalent in any other currency.

 

Majority Lenders means:

 

(a)        if no part of the Loan is then outstanding, a Lender or Lenders whose Commitments aggregate more than 66.66% of the Total Commitments; or

 

(b)        at any other time, a Lender or Lenders whose participations in the Loan aggregate more than 66.66% of the Loan.

 

Management Agreement means any management agreement of a Ship approved pursuant to clause 22.3 (Manager).

 

Manager means, in relation to a Ship, the Commercial Manager or the Technical Manager for that Ship and Managers means both of them.

 

Manager’s Undertaking means, in relation to a Ship, an undertaking by any manager of the Ship to the Security Agent in the agreed form, including if required pursuant to clause 22.3 (Manager).

 

Margin means 2.70 per cent per annum.

 

Material Adverse Effect means a material adverse effect on:

 

(a)        the business, operations, assets, condition (financial or otherwise) results of operation or liabilities of the Borrowers and/or the Guarantors; or

 

(b)       the ability of the Borrowers and/or the Guarantors to perform their respective obligations under any of the Finance Documents; or

 

(c)        the legality, validity or enforceability of, or the effectiveness or ranking of any Security Interest granted or purporting to be granted pursuant to any of, this Agreement or any of the Finance Documents or any of the rights or remedies of any Finance Party under this Agreement or any of the Finance Documents.

 

Minimum Value means, in respect of an Advance and at any time, the amount in dollars which is 120% of the outstanding principal of such Advance.

 

13

 

Mortgage means, in relation to a Ship, a first priority or (as the case may be) first preferred mortgage of the Ship in the agreed form by the relevant Owner in favour of the Security Agent and/or any of the other Finance Parties.

 

Mortgage Period means, in relation to a Mortgaged Ship, the period from the date the Mortgage over that Ship is executed and registered until the date such Mortgage is released and discharged or, if earlier, its Total Loss Date.

 

Mortgaged Ship means, at any relevant time, any Ship which is subject to a Mortgage and/or whose Earnings, Insurances and Requisition Compensation are subject to a Security Interest under the Finance Documents.

 

New Lender has the meaning given to that term in clause 30 (Changes to the Lenders).

 

Non-Acceptable Charterer means a charterer who:

 

(a)        is subject to Sanctions or otherwise a Prohibited Person, other than any such charterer with whom the relevant chartering activity by an Owner is not in breach of Sanctions; or

 

(b)       (to the Borrowers’ knowledge) is subject to a final, non-appealable order or judgment of a court of competent jurisdiction being the outcome of proceedings regarding sanctions, anti-bribery, anti-corruption, securities or environmental laws violations, to the extent such order or judgment would reasonably be expected to have a material adverse effect on the standing and reputation of such charterer.

 

Notifiable Debt Purchase Transaction has the meaning given to that term in clause 31.3(b) (Disenfranchisement of Debt Purchase Transactions entered into by Affiliates).

 

Obligors means together the Borrowers and the Guarantors (and Obligor means any one of them).

 

Original Financial Statements means:

 

(a)        the audited consolidated financial statements of the Parent for its financial year ended on 31 December 2019; and

 

(b)       the unaudited consolidated financial statements of GasLog Holdings for the financial year ended on 31 December 2019.

 

Original Security Documents means:

 

(a)        the Mortgages over each of the Ships;

 

(b)       the Deeds of Covenant in relation to each of the Ships in respect of which the Mortgage is in account current form;

 

(c)        the General Assignments in relation to each of the Ships in respect of which the Mortgage is in preferred form;

 

(d)       the Charter Assignment in relation to each Ship’s Charter Documents if applicable;

 

(e)        the Account Security in relation to each Account;

 

(f)        the Share Security in relation to each Borrower;

 

(g)       any Manager’s Undertaking in relation to a Ship, including if required under clause 22.3 (Manager); and

 

(h)        any Security Power of Attorney.

 

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Owner means, in relation to a Ship, the Borrower specified against the name of that Ship in Schedule 2 (Ship information) and Owners means all of them.

 

Parent means the company described as such in Schedule 1 (The original parties).

 

Parent Affiliate means the Parent, each of its Affiliates, any trust of which the Parent or any of its Affiliates is a trustee, any partnership of which the Parent or any of its Affiliates is a partner and any trust, fund or other entity which is managed by, or is under the control of, the Parent or any of its Affiliates.

 

Participating Member State means any member state of the European Union that has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.

 

Party means a party to this Agreement.

 

Payment Disruption Event means either or both of:

 

(a)        a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facility (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties; or

 

(b)       the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party preventing that, or any other Party:

 

(i)         from performing its payment obligations under the Finance Documents; or

 

(ii)        from communicating with other Parties in accordance with the terms of the Finance Documents,

 

and which (in either such case) is not caused by, and is beyond the control of, the Party whose operations are disrupted.

 

Permitted Holders means the persons disclosed by the Obligors to the Lenders in the negotiation of this Agreement as the persons controlling the affairs and composition of the majority of the board of directors of GasLog (as such persons are set out in item 7 (headed “Major Shareholder and related party transactions”) of the form 20-F relevant to the annual report submitted to the United States Securities and Exchange Commission by GasLog for the financial year ended on 31 December 2019).

 

Permitted Maritime Liens means, in relation to a Ship:

 

(a)        unless a Default is continuing, any ship repairer’s or outfitter’s possessory lien in respect of such Ship for an amount not exceeding the Major Casualty Amount for such Ship;

 

(b)       any lien on such Ship for master’s, officer’s or crew’s wages outstanding in the ordinary course of its trading;

 

(c)        any lien on such Ship for salvage; and

 

(d)       liens for master’s disbursements incurred in the ordinary course of business and any other lien arising by operation of law in the ordinary course of the business, repair or maintenance of such Ship,

 

each securing obligations not more than 30 days overdue.

 

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Permitted Security Interests means, in relation to any Mortgaged Ship, any Security Interest over it which is:

 

(a)        granted by the Finance Documents; or

 

(b)       a Permitted Maritime Lien; or

 

(c)        created in favour of a claimant or defendant in any proceedings or arbitration as security for costs and expenses while the relevant Owner is actively pursuing a claim or defending such proceedings or arbitration in good faith; or

 

(d)       a Security Interest arising by operation of law in respect of taxes which are not overdue for payment or in respect of taxes being contested in good faith by appropriate steps; or

 

(e)        approved by the Majority Lenders; or

 

(f)        created in connection with the Existing Indebtedness, until the Existing Indebtedness is discharged in full and in any event not later than the first Utilisation Date,

 

PROVIDED that in the case of (c) and (d) above the relevant liens (or any claim relating thereto) are, in the reasonable opinion of the Agent (acting on the instructions of the Majority Lenders), covered by insurance or, as the case may be, appropriate reserves have been made.

 

Pollutant means and includes crude oil and its products, any other polluting, toxic or hazardous substance and any other substance whose release into the environment is regulated or penalised by Environmental Laws.

 

Pool Arrangement has the meaning given to such term in clause 22.9 (Sharing of Earnings).

 

Prohibited Person has the meaning give to such term in clause 21.11(g) (Sanctions).

 

Quiet Enjoyment Agreement means, in relation to a Ship, a letter by the Security Agent addressed to, and acknowledged by, the relevant Owner and Charterer of that Ship in the agreed form (other than in respect of the Charters at the date of this Agreement, including being subject to compliance with Sanctions laws to the extent sanctions provisions acceptable to the Lenders, acting reasonably, are not included in the relevant charter).

 

Quotation Day means, in relation to any period for which an interest rate is to be determined, two business days on which banks are open for general business in London (other than Saturday and Sunday) before the first day of that period unless market practice differs in the Interbank Market for a currency, in which case the Quotation Day for that currency shall be determined by the Agent in accordance with market practice in the Interbank Market (and if quotations would normally be given by leading banks in the Interbank Market on more than one day, the Quotation Day will be the last of those days).

 

Receiver means a receiver or a receiver and manager or an administrative receiver appointed in relation to the whole or any part of any Charged Property under any relevant Security Document.

 

Reformed Basel III means the measures set out in the document entitled “Basel III: Finalising post-crisis reforms” published by the Basel Committee on Banking Supervision in December 2017, as amended, supplemented or restated.

 

Registry means, in relation to each Ship, such registrar, commissioner or representative of the relevant Flag State who is duly authorised and empowered to register the relevant Ship, the relevant Owner’s title to such Ship and the relevant Mortgage under the laws of its Flag State.

 

Related Fund means in relation to a fund (the first fund), means a fund which is managed or advised by the same investment manager or investment adviser as the first fund or, if it is managed by a different investment manager or investment adviser, a fund whose investment

 

16

 

manager or investment adviser is an Affiliate of the investment manager or investment adviser of the first fund.

 

Relevant Jurisdiction means, in relation to an Obligor:

 

(a)        its jurisdiction of incorporation;

 

(b)       any jurisdiction where any Charged Property owned by it is situated;

 

(c)        any jurisdiction where it conducts its business; and

 

(d)       any jurisdiction whose laws govern the perfection of any of the Security Documents entered into by it.

 

Repayment Date means, in relation to each Advance:

 

(a)           the First Repayment Date for such Advance;

 

(b)           each of the dates falling six monthly intervals thereafter up to but not including the Final Repayment Date; and

 

(c)           the Final Repayment Date.

 

Repayment Schedule means in relation to each Borrower, the repayment schedule for the Advance relating to that Borrower set out in Schedule 8 (Repayment Schedule).

 

Repeating Representations means each of the representations and warranties set out in clauses 18.3 (Status) to 18.12 (Ranking and effectiveness of security), 18.18 (No breach of laws), 18.21 (Anti-corruption law), 18.22 (Security and Financial Indebtedness), 18.24 (Shares), 18.26 (No adverse consequences), 18.27 (Copies of documents), 18.29 (No immunity), and 18.33 (Money Laundering) and 18.34(a) and 18.34(b)(v) (Sanctions).

 

Requisition Compensation means, in relation to a Ship, any compensation paid or payable by a government entity for the requisition for title, confiscation or compulsory acquisition of such Ship.

 

Sanctions has the meaning given to it in clause 21.11 (Sanctions).

 

Sanctions Authority has the meaning given to it in clause 21.11 (Sanctions).

 

Security Power of Attorney means a power of attorney in the agreed form issued by an Obligor in favour of the Security Agent, collateral to the Security Documents executed by that Obligor.

 

Screen Rate means the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for dollars and the relevant period displayed (before any correction, recalculation or republication by the administrator) on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate), or on the appropriate page of such other information service which publishes that rate from time to time in place of Thomson Reuters.  If such page or service ceases to be available, the Agent (acting on the instructions of the Majority Lenders) may specify another page or service displaying the relevant rate after consultation with the Borrowers.

 

Security Agent includes any person as may be appointed as security agent and trustee for the other Finance Parties under this Agreement and the other Finance Documents.

 

Security Documents means:

 

(a)        the Original Security Documents; and

 

17

 

(b)        any other document as may be executed to guarantee and/or secure any amounts owing to the Finance Parties under this Agreement or any other Finance Document.

 

Security Interest means a mortgage, charge, pledge, lien, assignment, trust, hypothecation or other security interest of any kind securing any obligation of any person or any other agreement or arrangement having a similar effect.

 

Security Value means, in respect of an Advance and at any time, the amount in dollars which, at that time, is the aggregate of (a) the value of the Mortgaged Ship relevant to that Advance which has not then become a Total Loss (or, if less, the maximum amount capable of being secured by such Mortgaged Ship) and (b) the value of any additional security then held by the Security Agent or any other Finance Party provided under clause 25 (Minimum security value) or clause 29.20(a)(ii) (Charters) in respect of that Advance, in each case as most recently determined in accordance with this Agreement.

 

Semi-Annual Financial Statements has the meaning given to it in clause 19.1 (Financial Statements).

 

Share Security means, in relation to each Borrower, the document constituting a first Security Interest in respect of all the shares of such Borrower executed by GasLog Holdings in favour of the Security Agent in the agreed form.

 

Shell Technical Manager means, in relation to Ship C, Shell International Shipping and Trading Company Limited of Shell Centre, London, SE1 7NA.

 

Ship A means the ship described as such in Schedule 2 (Ship information).

 

Ship B means the ship described as such in Schedule 2 (Ship information).

 

Ship C means the ship described as such in Schedule 2 (Ship information).

 

Ship Commitment means, in relation to a Ship, the amount specified as such in respect of such Ship in Schedule 2 (Ship information), being a part of the Total Commitments, as cancelled or reduced pursuant to any provision of this Agreement.

 

Ship Representations means each of the representations and warranties set out in clauses 18.30 (Ship status) and 18.31 (Ship’s employment).

 

Ships means each of the ships described in Schedule 2 (Ship information), being each of Ship A, Ship B and Ship C and Ship means any of them.

 

Spill means any spill, release or discharge of a Pollutant into the environment.

 

Subsidiary of a person means any other person:

 

(a)        directly or indirectly controlled by such person; or

 

(b)       of whose dividends or distributions on ordinary voting share capital such person is entitled to receive more than 50%.

 

Tax means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) and Taxation shall be construed accordingly.

 

Technical Manager means, in relation to a Ship, GasLog LNG Services, GasLog, any wholly owned subsidiary of GasLog, (in relation to Ship C only and for so long as Ship C is subject to its Charter) the Shell Technical Manager or another manager appointed as technical manager of that Ship by the relevant Owner in accordance with clause 22.3 (Manager).

 

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Total Commitments means the aggregate of the Commitments, being $260,331,250 as at the date of this Agreement.

 

Total Loss means, in relation to a vessel, its:

 

(a)        actual, constructive, compromised, agreed or arranged total loss; or

 

(b)       requisition for title, confiscation or other compulsory acquisition by a government entity; or

 

(c)        condemnation, capture, seizure, arrest or detention for more than 30 days; or

 

(d)       hijacking, piracy or theft for more than 60 days.

 

Total Loss Date means, in relation to the Total Loss of a vessel:

 

(a)        in the case of an actual total loss, the date it happened or, if such date is not known, the date on which the vessel was last reported;

 

(b)       in the case of a constructive, compromised, agreed or arranged total loss, the earliest of:

 

(i)         the date notice of abandonment of the vessel is given to its insurers; or

 

(ii)        if the insurers do not admit such a claim, the date later determined by a competent court of law to have been the date on which the total loss happened; or

 

(iii)       the date upon which a binding agreement as to such compromised or arranged total loss has been entered into by the vessel’s insurers;

 

(c)        in the case of a requisition for title, confiscation or compulsory acquisition, the date it happened;

 

(d)       in the case of condemnation, capture, seizure, arrest or detention, the date 30 days after the date upon which it happened; and

 

(e)        in the case of hijacking, piracy or theft, the date 60 days after the date upon which it happened.

 

Total Loss Repayment Date means, where a Mortgaged Ship has become a Total Loss, the earlier of:

 

(a)        the date falling 180 days after its Total Loss Date; and

 

(b)       the date upon which insurance proceeds or Requisition Compensation for such Total Loss are paid by insurers or the relevant government entity.

 

Transfer Certificate means a certificate substantially in the form set out in Schedule 6 (Form of Transfer Certificate) or any other form agreed between the Agent and the Borrowers or, at any time after the occurrence of an Event of Default, required by the Agent.

 

Transfer Date means, in relation to an assignment pursuant to a Transfer Certificate, the later of:

 

(a)        the proposed Transfer Date specified in the Transfer Certificate; and

 

(b)       the date on which the Agent executes the Transfer Certificate.

 

Treasury Transaction means any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price.

 

19

 

Trust Property means, collectively:

 

(a)        all moneys duly received by the Security Agent under or in respect of the Finance Documents;

 

(b)       any portion of the balance on any Account held by or charged to the Security Agent at any time;

 

(c)        the Security Interests, guarantees, security, powers and rights given to the Security Agent under and pursuant to the Finance Documents including, without limitation, the covenants given to the Security Agent in respect of all obligations of any Obligor and any Manager (other than the Shell Technical Manager);

 

(d)       all assets paid or transferred to or vested in the Security Agent or its agent or received or recovered by the Security Agent or its agent in connection with any of the Finance Documents whether from any Obligor, any Manager or any other person; and

 

(e)        all or any part of any rights, benefits, interests and other assets at any time representing or deriving from any of the above, including all income and other sums at any time received or receivable by the Security Agent or its agent in respect of the same (or any part thereof).

 

Unpaid Sum means any sum due and payable but unpaid by an Obligor under the Finance Documents.

 

US means the United States of America.

 

US Tax Obligor means:

 

(a)        a Borrower if it is resident for tax purposes in the US; or

 

(b)       an Obligor some or all of whose payments under the Finance Documents are from sources within the US for US federal income tax purposes.

 

Utilisation means the making of an Advance.

 

Utilisation Date means the date on which a Utilisation is made.

 

Utilisation Request means a notice substantially in the form set out in Schedule 4 (Utilisation Request).

 

VAT means:

 

(a)        any tax imposed in compliance with the Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and

 

(b)       any other tax of a similar nature, whether imposed in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) above, or imposed elsewhere.

 

1.2      Construction

 

(a)        Unless a contrary indication appears, any reference in any of the Finance Documents to:

 

(i)         Sections, clauses and Schedules are to be construed as references to the Sections and clauses of, and the Schedules to, the relevant Finance Document and references to a Finance Document include its Schedules;

 

20

 

(ii)        a Finance Document or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as it may from time to time be amended, restated, novated or replaced, however fundamentally;

 

(iii)       words importing the plural shall include the singular and vice versa;

 

(iv)       a time of day is to Paris time;

 

(v)        any person includes its successors in title, permitted assignees or transferees;

 

(vi)       the knowledge, awareness and/or beliefs (and similar expressions) of any Obligor shall be construed so as to mean the knowledge, awareness and beliefs of the director and officers of such Obligor, having made due and careful enquiry;

 

(vii)      two or more persons are acting in concert if pursuant to an agreement or understanding (whether formal or informal) they actively co-operate, through the acquisition (directly or indirectly) of shares, partnership interest or units or limited liability company interests in an entity by any of them, either directly or indirectly, to obtain or consolidate control of that entity;

 

(viii)     a document in agreed form means:

 

(A)       where a Finance Document has already been executed by all of the relevant parties to it, such Finance Document in its executed form; and

 

(B)       prior to the execution of a Finance Document, the form of such Finance Document separately agreed in writing between the Agent (acting on the instructions of all the Lenders) and the Borrowers, whether before or after the date of this Agreement, as the form in which that Finance Document is to be executed or another form approved at the request of the Borrowers or, if not so agreed or approved, in the form reasonably required by the Agent;

 

(ix)       approved by the Majority Lenders or approved by the Lenders means approved in writing by the Agent acting on the instructions of the Majority Lenders or, as the case may be, all of the Lenders (on such conditions as they may respectively impose) and otherwise approved means approved in writing by the Agent acting on the instructions of the Majority Lenders (on such conditions as the Agent (acting on the instructions of the Majority Lenders) may impose) and approval and approve shall be construed accordingly;

 

(x)        assets includes present and future properties, revenues and rights of every description;

 

(xi)       an authorisation means any authorisation, consent, concession, approval, resolution, licence, exemption, filing, notarisation or registration;

 

(xii)      charter commitment means, in relation to a vessel, any charter or contract for the use, employment or operation of that vessel or the carriage of people and/or cargo or the provision of services by or from it and includes any agreement for pooling or sharing income derived from any such charter or contract;

 

(xiii)        control of an entity means:

 

(A)       the power (whether by way of ownership of shares, partnership interest or units or limited liability company interest or by proxy, contract, agency or otherwise, directly or indirectly) to:

 

(1)        cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting (or equivalent) of that entity; or

 

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(2)        appoint or remove all, or the majority, of the directors or other equivalent officers of that entity; or

 

(3)        give directions with respect to the operating and financial policies of that entity with which the directors or other equivalent officers of that entity are obliged to comply; and/or

 

(B)       the holding beneficially of more than 50% of the issued share capital, partnership interest or units or limited liability company interest of that entity, as the case may be, (excluding any part of that issued share capital, partnership interest or units or limited liability company interest that carries no right to participate beyond a specified amount in a distribution of either profits or capital) (and, for this purpose, a Security Interest over share capital, partnership interest or units or limited liability company interest shall be disregarded in determining the beneficial ownership of such share capital, partnership interest or units or limited liability company interest);

 

and controlled shall be construed accordingly;

 

(xiv)    the term disposal or dispose means a sale, transfer or other disposal (including by way of lease or loan but not including by way of loan of money) by a person of all or part of its assets, whether by one transaction or a series of transactions and whether at the same time or over a period of time, but not the creation of a Security Interest;

 

(xv)     dollar, $ and USD mean the lawful currency of the United States of America;

 

(xvi)    the equivalent of an amount specified in a particular currency (the specified currency amount) shall be construed as a reference to the amount of the other relevant currency which can be purchased with the specified currency amount in the London foreign exchange market at or about 11:00 a.m. on the date the calculation falls to be made for spot delivery, as conclusively determined by the Agent (with the relevant exchange rate of any such purchase being the Agent’s spot rate of exchange);

 

(xvii)   a government entity means any government, state or agency of a state;

 

(xviii)  a group of Lenders includes all the Lenders;

 

(xix)    a guarantee means any guarantee, letter of credit, bond, indemnity or similar assurance against loss, or any obligation, direct or indirect, actual or contingent, to purchase or assume any indebtedness of any person or to make an investment in or loan to any person or to purchase assets of any person where, in each case, such obligation is assumed in order to maintain or assist the ability of such person to meet its indebtedness;

 

(xx)     indebtedness includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;

 

(xxi)    month means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month or the calendar month in which it is to end, except that:

 

(A)       if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that month (if there is one) or on the immediately preceding Business Day (if there is not); and

 

(B)       if there is no numerically corresponding day in that month, that period shall end on the last Business Day in that month,

 

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and the above rules in paragraphs (A) to (B) will only apply to the last month of any period;

 

(xxii)   an obligation means any duty, obligation or liability of any kind;

 

(xxiii)  something being in the ordinary course of business of a person means something that is in the ordinary course of that person’s current day-to-day operational business (and not merely anything which that person is entitled to do under its Constitutional Documents);

 

(xxiv)  pay, prepay or repay in clause 28 (Business restrictions) includes by way of set-off, combination of accounts or otherwise;

 

(xxv)   a person includes any individual, firm, company, corporation, government entity or any association, trust, joint venture, consortium or partnership or other entity (whether or not having separate legal personality);

 

(xxvi)  a regulation includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation and includes (without limitation) any Basel II Regulation or Basel III Regulation;

 

(xxvii) right means any right, privilege, power or remedy, any proprietary interest in any asset and any other interest or remedy of any kind, whether actual or contingent, present or future, arising under contract or law, or in equity;

 

(xxviii) trustee, fiduciary and fiduciary duty has in each case the meaning given to such term under applicable law;

 

(xxix)  (i) the liquidation, winding up, dissolution, or administration of person or (ii) a receiver or administrative receiver or administrator in the context of insolvency proceedings or security enforcement actions in respect of a person shall be construed so as to include any equivalent or analogous proceedings or any equivalent and analogous person or appointee (respectively) under the law of the jurisdiction in which such person is established or incorporated or any jurisdiction in which such person carries on business including (in respect of proceedings) the seeking or occurrences of liquidation, winding-up, reorganisation, dissolution, administration, arrangement, adjustment, protection or relief of debtors;

 

(xxx)   a wholly-owned subsidiary has the meaning given to that term in section 1159 of the Companies Act 2006; and

 

(xxxi)  a provision of law is a reference to that provision as amended or re-enacted.

 

(b)       The determination of the extent to which a rate is for a period equal in length to an Interest Period shall disregard any inconsistency arising from the last day of that Interest Period being determined pursuant to the terms of this Agreement.

 

(c)        Where in this Agreement a provision includes a monetary reference level in one currency, unless a contrary indication appears, such reference level is intended to apply equally to its equivalent in other currencies as of the relevant time for the purposes of applying such reference level to any other currencies.

 

(d)       Section, clause and Schedule headings are for ease of reference only.

 

(e)        Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.

 

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(f)        A Default (other than an Event of Default) is continuing if it has not been remedied or waived and an Event of Default is continuing if it has not been waived or remedied to the satisfaction of the Agent (acting on the instructions of all the Lenders).

 

(g)       Unless a contrary indication appears, in the event of any inconsistency between the terms of this Agreement and the terms of any other Finance Document when dealing with the same or similar subject matter, the terms of this Agreement shall prevail.

 

1.3      Third party rights

 

(a)        Unless expressly provided to the contrary in a Finance Document for the benefit of a Finance Party or another Indemnified Person, a person who is not a party to a Finance Document has no right under the Contracts (Rights of Third Parties) Act 1999 (the Third Parties Act) to enforce or enjoy the benefit of any term of the relevant Finance Document.

 

(b)       Any Finance Document may be rescinded or varied by the parties to it without the consent of any person who is not a party to it.

 

(c)        An Indemnified Person who is not a party to a Finance Document may only enforce its rights under that Finance Document through a Finance Party and if and to the extent and in such manner as the Finance Party may determine.

 

1.4      Finance Documents

 

Where any other Finance Document provides that this clause 1.4 shall apply to that Finance Document, any other provision of this Agreement which, by its terms, purports to apply to all or any of the Finance Documents and/or any Obligor shall apply to that Finance Document as if set out in it but with all necessary changes.

 

1.5      Conflict of documents

 

The terms of the Finance Documents (other than as relates to the creation and/or perfection of security) are subject to the terms of this Agreement and, in the event of any conflict between any provision of this Agreement and any provision of any Finance Document (other than in relation to the creation and/or perfection of security) the provisions of this Agreement shall prevail.

 

2       The Facility

 

2.1      The Facility

 

Subject to the terms of this Agreement, the Lenders make available to the Borrowers a term loan facility in an aggregate amount equal to the Total Commitments.

 

2.2      Finance Parties’ rights and obligations

 

(a)        The obligations of each Finance Party under the Finance Documents are several. Failure by a Finance Party to perform its obligations under the Finance Documents does not affect the obligations of any other Party under the Finance Documents.  No Finance Party is responsible for the obligations of any other Finance Party under the Finance Documents.

 

(b)       The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from an Obligor shall be a separate and independent debt.

 

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(c)        A Finance Party may, except as otherwise stated in the Finance Documents (including clauses 32.30 (All enforcement action through the Security Agent) and 33.2 (Finance Parties acting together)), separately enforce its rights under the Finance Documents.

 

2.3      Borrowers’ rights and obligations

 

(a)        The obligations of each Borrower under this Agreement are joint and several.  Failure by a Borrower to perform its obligations under this Agreement shall constitute a failure by all of the Borrowers.

 

(b)       Each Borrower irrevocably and unconditionally jointly and severally with each other Borrower:

 

(i)         agrees that it is responsible for the performance of the obligations of each other Borrower under this Agreement;

 

(ii)        acknowledges and agrees that it is a principal and original debtor in respect of all amounts due from the Borrowers under this Agreement; and

 

(iii)       agrees with each Finance Party that, if any obligation of another Borrower under this Agreement is or becomes unenforceable, invalid or illegal for any reason it will, as an independent and primary obligation, indemnify that Finance Party immediately on demand against any and all Losses it incurs as a result of another Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by that other Borrower under this Agreement. The amount payable under this indemnity shall be equal to the amount which that Finance Party would otherwise have been entitled to recover.

 

(c)        The obligations of each Borrower under the Finance Documents shall continue until all amounts which may be or become payable by the Borrowers under or in connection with the Finance Documents have been irrevocably and unconditionally paid or discharged in full, regardless of any intermediate payment or discharge in whole or in part.

 

(d)       If any discharge, release or arrangement (whether in respect of the obligations of a Borrower or any security for those obligations or otherwise) is made by a Finance Party in whole or in part on the basis of any payment, security or other disposition which is avoided or must be restored in insolvency, liquidation, administration or otherwise, without limitation, then the liability of the Borrowers under this Agreement will continue or be reinstated as if the discharge, release or arrangement had not occurred.

 

(e)        The obligations of each Borrower under the Finance Documents shall not be affected by an act, omission, matter or thing which, but for this clause (whether or not known to it or any Finance Party), would reduce, release or prejudice any of its obligations under the Finance Documents including:

 

(i)         any time, waiver or consent granted to, or composition with, any Obligor or other person;

 

(ii)        the release of any other Obligor or any other person under the terms of any composition or arrangement with any creditor of any other Obligor;

 

(iii)       the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, any Obligor or other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

 

(iv)       any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of an Obligor or any other person;

 

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(v)        any amendment, novation, supplement, extension, restatement (however fundamental and whether or not more onerous) or replacement of a Finance Document or any other document or security;

 

(vi)       any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security; or

 

(vii)      any insolvency or similar proceedings.

 

(f)        Each Borrower waives any right it may have of first requiring any Finance Party (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before claiming from that Borrower under any Finance Document. This waiver applies irrespective of any law or any provision of a Finance Document to the contrary.

 

(g)       Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably and unconditionally paid or discharged in full, each Finance Party (or any trustee or agent on its behalf) may:

 

(i)         refrain from applying or enforcing any other moneys, security or rights held or received by that Finance Party (or any trustee or agent on its behalf) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and no Borrower will be entitled to the benefit of the same; and

 

(ii)        hold in an interest-bearing suspense account any money received from any Borrower or on account of any Borrower’s liability under any Finance Document.

 

(h)        Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full and unless the Agent otherwise directs (on such terms as it may require), no Borrower shall exercise any rights (including rights of set-off) which it may have by reason of performance by it of its obligations under the Finance Documents:

 

(i)         to be indemnified by another Obligor; and/or

 

(ii)        to claim any contribution from any other Obligor or any guarantor of any Obligor’s obligations under the Finance Documents; and/or

 

(iii)       to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Finance Parties under the Finance Documents or of any guarantee or security taken pursuant to, or in connection with, the Finance Documents by any Finance Party; and/or

 

(iv)       to bring legal or other proceedings for an order requiring any Obligor to make any payment, or perform any obligation, in respect of which that Borrower is liable under this Agreement or any of the other Finance Documents; and/or

 

(v)        to exercise any right of set-off against any other Obligor; and/or

 

(vi)       to claim or prove as a creditor of any other Obligor in competition with any Finance Party.

 

If a Borrower receives any benefit, payment or distribution in relation to such rights it will promptly pay an equal amount to the Agent for application in accordance with clause 35 (Payment mechanics). This only applies until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full.

 

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3       Purpose

 

3.1      Purpose

 

The Borrowers shall apply all amounts borrowed under the Facility in accordance with and subject to clause 3.2 (Use).

 

3.2      Use

 

The Ship Commitment for each Ship shall be made available solely for the purpose of:

 

(a)        assisting the relevant Owner to refinance the Existing Indebtedness made available in respect of that Ship in full; and

 

(b)       the payment of fees pursuant to clause 11 (Fees) and any other fees, costs and expenses arising under this Agreement.

 

3.3      Monitoring

 

No Finance Party is bound to monitor or verify the application of any amount borrowed pursuant to this Agreement.

 

4       Conditions of Utilisation

 

4.1      Conditions precedent to the delivery of a Utilisation Request

 

The Borrowers may not deliver a Utilisation Request unless the Agent, or its duly authorised representative, has received all of the documents and the evidence listed in Schedule 3, Part 1 (Conditions precedent to any Utilisation) in form and substance satisfactory to the Agent.

 

4.2      Conditions precedent to Utilisation

 

The Ship Commitment in respect of each Ship may only be made available under this Agreement if, the Agent, or its duly authorised representative, has received all of the documents and evidence listed in Schedule 3, Part 2 (Conditions precedent to Utilisation) in relation to such Ship in form and substance satisfactory to the Agent.

 

4.3      Notice to Lenders

 

The Agent shall notify the Borrowers and the Lenders promptly upon receiving and being satisfied with all of the documents and evidence delivered to it under this clause 4. Other than to the extent that the Majority Lenders notify the Agent in writing to the contrary before the Agent gives any such notification, the Lenders authorise (but do not require) the Agent to give that notification. The Agent shall not be liable for any damages, costs or losses whatsoever as a result of giving any such notification.

 

4.4      Further conditions precedent

 

The Lenders will only be obliged to comply with clause 5.4 (Lenders’ participation) if:

 

(a)        no Default is continuing or would result from the proposed Utilisation;

 

(b)       in relation to each Utilisation, on the date of the Utilisation Request and on the proposed Utilisation Date, all of the representations set out in clause 18 (Representations) (except the Ship Representations) are true;

 

(c)        where the proposed Utilisation Date is to be the first day of the Mortgage Period for a Ship, the Ship Representations for that Ship are true on the proposed Utilisation Date;

 

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(d)       no events, facts, conditions or circumstances shall exist or have arisen or occurred (and neither the Agent nor any Lender shall have become aware of other events, facts, conditions or circumstances not previously known to it), which the Agent (acting on the instructions of the Majority Lenders) shall determine, have had or might have, a Material Adverse Effect;

 

(e)        no Total Loss Date has occurred in relation to the applicable Ship;

 

(f)        the Security Value in respect of an Advance would not be less than the Minimum Value for such Advance immediately after the proposed Utilisation; and

 

(g)       no prepayment or cancellation event has occurred under clause 7.9 (Mandatory prepayment and cancellation following non-compliance with Sanctions).

 

4.5      Waiver of conditions precedent

 

The conditions in this clause 4 are inserted solely for the benefit of the Finance Parties and may be waived on their behalf in whole or in part and with or without conditions by the Agent acting on the instructions of the Majority Lenders provided however that the conditions set out under paragraphs 2, 3, 6, 7, 8, 9, 10 and 11 of Part 2 of Schedule 3 (Conditions precedent) may only be waived by the Agent, acting on the instructions of all the Lenders.

 

5       Utilisation

 

5.1      Delivery of a Utilisation Request

 

The Borrowers may utilise the Facility by delivery to the Agent of a duly completed Utilisation Request not later than 11:00 a.m. three (3) Business Days before the proposed Utilisation Date.

 

5.2      Completion of a Utilisation Request

 

(a)        A Utilisation Request is irrevocable and will not be regarded as having been duly completed unless:

 

(i)         the proposed Utilisation Date for each Advance is the same Business Day falling not later than the Last Availability Date;

 

(ii)        the currency and amount of the Utilisation comply with this clause 5.2 and with clause 5.3 (Currency and amount);

 

(iii)       the proposed Interest Period complies with clause 9 (Interest Periods); and

 

(iv)       it identifies the purpose for the Utilisation and that purpose complies with clause 3 (Purpose).

 

(b)       The Advance for each Ship must be requested in the same Utilisation Request.

 

5.3      Currency and amount

 

(a)        The currency specified in a Utilisation Request must be dollars.

 

(b)       The total amount available and advanced under the Ship Commitment for a Ship shall not exceed that permitted by the definition of Advance for that Ship.

 

(c)        Only one Utilisation may be made in respect of each Ship.

 

5.4      Lenders’ participation

 

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(a)        If the conditions set out in this Agreement have been met, each Lender shall make its participation in each Advance available by providing funds or a copy of an irrevocable payment order to the Agent no later than 11:00 am Paris time on the Utilisation Date through its Facility Office.

 

(b)       The amount of each Lender’s participation in an Advance will be equal to the proportion borne by its Commitment to the Total Commitments immediately prior to making the relevant Advance.

 

(c)        The Agent shall promptly notify each Lender of the amount of the Advance and the amount of its participation in the Advance, in each case by 11:00 am Paris time on the second Business Day before the proposed Utilisation Date.

 

(d)       The Agent shall pay all amounts received by it in respect of each Advance (and its own participation in it, if any) to the Borrowers or for the account of any of them or to any Existing Indebtedness Lender, in each case in accordance with the instructions contained in the Utilisation Request.

 

6       Repayment

 

6.1      Scheduled Repayment of Facility

 

(a)        To the extent not previously reduced or prepaid, the Advance in respect of each Ship shall be repaid by instalments on each Repayment Date in the amounts as specified in the Repayment Schedule for the relevant Advance.

 

(b)       On the Final Repayment Date (without prejudice to any other provision of this Agreement), each Advance shall, to the extent not previously reduced be repaid in full together with all outstanding amounts under this Agreement and all other Finance Documents.

 

6.2      Adjustment of scheduled repayments

 

(a)        If the Advance for a Ship has been partially reduced under this Agreement and/or any part of the relevant Advance is prepaid (other than under clause 6.1 (Scheduled Repayment of Facility)) before any Repayment Date in respect of that Advance then, unless stated otherwise in this Agreement, the amount of the instalment by which the relevant Advance shall be repaid under clause 6.1 on any such Repayment Date (as reduced by any earlier operation of this clause 6.2) shall be reduced pro rata to such reduction and/or prepayment of the relevant Advance.

 

(b)       If at any stage an Advance is reduced pursuant to this clause 6.2, the Agent shall issue a replacement Repayment Schedule which shall, in the absence of manifest error, be binding on all Parties.

 

7       Illegality, prepayment and cancellation

 

7.1      Illegality

 

If it becomes unlawful in any applicable jurisdiction for a Lender to perform any of its obligations as contemplated by this Agreement or any of the other Finance Documents, or for any Lender to fund or maintain its participation in the Loan or it becomes unlawful for any Affiliate of a Lender for that Lender to do so:

 

(a)        that Lender shall promptly notify the Agent upon becoming aware of that event;

 

(b)       upon the Agent notifying the Borrowers, the Commitments of that Lender will be immediately cancelled and the Total Commitments shall be reduced accordingly and the remaining Ship Commitments shall be reduced rateably; and

 

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(c)        the Borrowers shall repay that Lender’s participation in the Loan on the last day of the Interest Period occurring after the Agent has notified the Borrowers or, if earlier, the date specified by the Lender in the notice delivered to the Agent (being no earlier than the last day of any applicable grace period permitted by law).

 

7.2      Change of Control; delisting

 

(a)        If there is a Change of Control, the Borrowers shall promptly notify the Agent upon any Obligor becoming aware of a Change of Control occurring.

 

(b)       Upon becoming notified by any Party of:

 

(i)         a Change of Control in respect of the Parent or GasLog Holdings, the Agent shall, if instructed by the Majority Lenders, by notice to the Borrowers, cancel the Total Commitments immediately and declare the Advances to be payable within ten (10) Business Days from the date of such notice. Upon such notice being given, the Total Commitments shall be forthwith cancelled and the Borrowers shall, within such ten (10) Business Day period, prepay the Advances in full together with all other amounts owing under this Agreement or any of the other Finance Documents; and

 

(ii)        a Change of Control in respect of a Borrower, clause 7.6 (Sale, Total Loss, Change of Control in respect of a Borrower or prepayment in full of an Advance) shall apply.

 

(c)        If the Parent ceases to be listed on an Approved Exchange for any reason, without the prior consent of the Majority Lenders, other than as a result of a voluntary decision to delist taken by the Parent, the Borrowers shall notify the Agent of the same upon its occurrence, and the Agent, upon being notified shall, if instructed by the Majority Lenders, cancel the Total Commitments immediately and declare the Advances to be payable within ten (10) Business Days from the date of such notice. Upon such notice being given, the Total Commitments shall be immediately cancelled and the Borrowers shall, within such ten (10) Business Day period, prepay the Advances in full together with all other amounts owing under this Agreement or any of the other Finance Documents.

 

7.3      Voluntary cancellation

 

The Borrowers may, if they give the Agent not less than ten (10) Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice, cancel the whole or any part (being a minimum amount of $5,000,000 and a multiple of $1,000,000) of any Ship Commitment which is undrawn at the proposed date of cancellation. Any cancellation under this clause 7.3 shall reduce the Commitments of the Lenders rateably.

 

7.4      Voluntary prepayment

 

(a)        The Borrowers may, if they give the Agent not less than ten (10) Business Days (or such shorter period as the Majority Lenders may agree) prior written notice, prepay the whole or any part of the Loan (being a minimum amount of $5,000,000 and a multiple of $1,000,000), on the last day of an Interest Period in respect of the amount to be prepaid (or any other date subject to payment of any Break Costs).

 

(b)       Any election by the Borrowers to make a voluntary prepayment pursuant to clause 7.4(a) shall, where such voluntary prepayment is for the whole of an Advance, be subject to the conditions set out in clause 7.6 (Sale, Total Loss, Change of Control in respect of a Borrower or prepayment in full of an Advance) being complied with mutatis mutandis as if set out in full herein.

 

(c)        The Borrowers may prepay a part of any Advance in accordance with the terms of clause 25.12(a)(ii)(Security shortfall).

 

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(d)       The Borrowers may prepay any part of any Advance in accordance with the terms of clause 29.20(a)(i)(Charters).

 

7.5      Right of replacement or cancellation and prepayment in relation to a single Lender/Right of cancellation in relation to a Defaulting Lender

 

(a)        If:

 

(i)         any sum payable to any Lender by an Obligor is required to be increased under clause 12.2 (Tax gross-up); or

 

(ii)        any Lender claims indemnification from the Borrowers under clause 12.3 (Tax indemnity) or clause 13.1 (Increased Costs),

 

the Borrowers may, whilst the circumstance giving rise to the requirement for that increase or indemnification continues, give the Agent notice of cancellation of the Commitments of that Lender and their intention to procure the repayment of that Lender’s participation in the Loan or give the Agent notice of their intention to replace that Lender in accordance with clause 7.5(d).

 

(b)       On receipt of a notice referred to in clause 7.5(a) above, the Commitments of that Lender shall immediately be reduced to zero and (unless the Commitments of the relevant Lender are replaced in accordance with clause 7.5(d)) the Total Commitments shall be reduced accordingly. The Agent shall as soon as practicable after receipt of a notice referred to in clause 7.5(a) above, notify all the Lenders.

 

(c)        On the last day of each Interest Period which ends after the Borrowers have given notice under clause 7.5(a) above in relation to a Lender (or, if earlier, the date specified by the Borrowers in that notice), the Borrowers shall repay that Lender’s participation in the Loan.

 

(d)       The Borrowers may, in the circumstances set out in clause 7.5(a), on fifteen (15) Business Days’ prior notice to the Agent and that Lender, replace that Lender by requiring that Lender to assign (and, to the extent permitted by law, that Lender shall assign) pursuant to clause 30 (Changes to the Lenders) all (and not part only) of its rights under this Agreement to a Lender or other bank, financial institution, trust, fund or other entity selected by the Borrowers which confirms its willingness to assume and does assume all the obligations of the assigning Lender in accordance with clause 30 (Changes to the Lenders) for a purchase price in cash payable at the time of the assignment equal to the aggregate of:

 

(i)         the outstanding principal amount of such Lender’s participation in the Loan;

 

(ii)        all accrued interest owing to such Lender to the extent that the Agent has not given a notification under clause 30.8 (Pro rata interest settlement);

 

(iii)       the Break Costs which would have been payable to such Lender pursuant to clause 10.5 (Break Costs) had the Borrowers prepaid in full that Lender’s participation in the Loan on the date of the assignment; and

 

(iv)       all other amounts payable to that Lender under the Finance Documents on the date of the assignment.

 

(e)        The replacement of a Lender pursuant to clause 7.5(d) shall be subject to the following conditions:

 

(i)         the Borrowers shall have no right to replace the Agent;

 

(ii)        neither the Agent nor any Lender shall have any obligation to find a replacement Lender;

 

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(iii)       in no event shall the Lender replaced under clause 7.5(d) be required to pay or surrender any of the fees received by such Lender pursuant to the Finance Documents; and

 

(iv)       the Lender shall only be obliged to assign its rights pursuant to clause 7.5(d) above once it is satisfied that it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to that assignment.

 

(f)        A Lender shall perform the checks described in clause 7.5(e)(iv) above as soon as reasonably practicable following delivery of a notice referred to in clause 7.5(d) above and shall notify the Agent and the Borrowers when it is satisfied that it has complied with those checks.

 

(g)       If any Lender becomes a Defaulting Lender, the Borrowers may, at any time whilst the Lender continues to be a Defaulting Lender, give the Agent five (5) Business Days’ notice of cancellation of the undrawn Commitments of that Lender.

 

(h)        On the notice referred to in clause 7.5(g) above becoming effective, the undrawn Commitments of the Defaulting Lender shall immediately be reduced to zero and (unless the Commitments of the relevant Lender are replaced in accordance with 41.5 (Replacement of a Defaulting Lender)) the remaining undrawn Ship Commitments shall each be reduced rateably and the Total Commitments shall be reduced accordingly, and the Agent shall as soon as practicable after receipt of such notice, notify all the Lenders.

 

7.6      Sale, Total Loss, Change of Control in respect of a Borrower or prepayment in full of an Advance

 

(a)        On a Mortgaged Ship’s Disposal Repayment Date or upon the cancellation in full of a Ship Commitment pursuant to clause 7.3 (Voluntary cancellation) or a prepayment in full of an Advance pursuant to clause 7.4 (Voluntary prepayment) or upon a Change of Control in respect of a Borrower, the Borrowers shall:

 

(i)         if such disposal, cancellation, prepayment or Change of Control relates to Ship A, prepay in full the Advance in respect of Ship A and the Ship Commitment for Ship A shall be reduced to zero; or

 

(ii)        if such disposal, cancellation, prepayment or Change of Control relates to Ship B or, as the case may be, Ship C:

 

(A)       prepay in full the Advance in respect of Ship B or, as the case may be, Ship C and the Ship Commitment for Ship B or, as the case may be, Ship C shall be reduced to zero;

 

(B)       prepay against the remaining Commitments in respect of Advance A in inverse order of maturity an amount of ten million Dollars ($10,000,000) or the balance of the remaining Commitments in respect of Advance A, if less;

 

(C)       prepay against the remaining Commitments in respect of Advance B or, as the case may be, Advance C pro rata the balance (if any) of the ten million Dollars ($10,000,000) referred to in in paragraph (B) above;

 

(D)       if required following the prepayments made pursuant to paragraphs (B) and (C) above, such additional amount as is necessary to ensure that the aggregate of the Security Value of all remaining Advances immediately after such prepayment shall be not less than the higher of:

 

(1)        120% of the Loan; or

 

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(2)        an amount equal to the ratio between the aggregate Security Value for the Advances and the amount of the Loan immediately prior to such prepayment,

 

and, in such case, such additional amount shall be applied pro rata against the remaining Commitments in respect of advance A (if any) and Advance B, or, as the case may be, Advance C; or

 

(iii)       if such disposal, cancellation, prepayment or Change of Control relates to Ship B and Ship C, prepay in full the Advance in respect of all Ships and the Ship Commitment for each Ship shall be reduced to zero.

 

(b)       The consent of the Lenders to the release, discharge and reassignment of any Security Interest in connection with the prepayment in full of any Advance pursuant to clause 7.4(b) shall be subject to no Event of Default continuing at the time the prepayment is made.

 

7.7      Automatic cancellation

 

Any part of a Ship Commitment which has not become available by, or which is undrawn on, the Last Availability Date shall be automatically cancelled at close of business in Paris on the Last Availability Date.

 

7.8      Restrictions

 

(a)        Any notice of cancellation or prepayment given by any Party under this clause 7 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant cancellation or prepayment is to be made and the amount of that cancellation or prepayment and, in the case of a cancellation or prepayment under clause 7.3 (Voluntary cancellation) or 7.4 (Voluntary prepayment), the Ship Commitment to be cancelled or prepaid (as the case may be).

 

(b)        Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, subject to any Break Costs, without premium or penalty.

 

(c)        The Borrowers may not reborrow any part of the Facility which is repaid or prepaid.

 

(d)        The Borrowers shall not repay or prepay all or any part of the Advances or cancel all or any part of the Commitments except at the times and in the manner expressly provided for in this Agreement.

 

(e)        No amount of the Total Commitments cancelled under this Agreement may be subsequently reinstated.

 

(f)         If the Agent receives a notice under this clause 7 it shall promptly forward a copy of that notice to either the Borrowers or the affected Lender, as appropriate.

 

(g)        If the Total Commitments are partially reduced under this Agreement (other than under clause 7.1 (Illegality) and clause 7.5 (Right of replacement or cancellation and prepayment in relation to a single Lender/Right of cancellation in relation to a Defaulting Lender)), the Commitments of all the Lenders under the Facility shall be reduced pro rata (except where otherwise expressly specified in this Agreement).

 

(h)        In all cases where the Total Commitments are partially reduced under this Agreement (other than in relation to a cancellation of all of the Ship Commitment for a Ship under clause 7.6 (Sale, Total Loss, Change of Control in respect of a Borrower or prepayment in full of an Advance) or where a Borrower has so selected under clause 7.3 (Voluntary cancellation) or clause 7.4 (Voluntary prepayment), or except where otherwise expressly specified in this Agreement), the Ship Commitments for all Ships shall be reduced pro rata.

 

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(i)         If the Loan is partially prepaid under this Agreement (other than under clause 7.1 (Illegality) and clause 7.5 (Right of replacement or cancellation and prepayment in relation to a single Lender / right of cancellation in relation to a Defaulting Lender)), the amount prepaid shall reduce the participation of all the Lenders in the Loan rateably (except where otherwise expressly specified in this Agreement).

 

(j)         Any prepayment of the Loan for the account of all the Lenders shall be applied pro rata to each Lender’s participation in Loan (other than a prepayment under clause 7.6 (Sale, Total Loss, Change of Control in respect of a Borrower or prepayment in full of an Advance) or where a Borrower has so selected under clause 7.4 (Voluntary prepayment), where such prepayment will first be applied to the Advance in relation to the relevant Ship).

 

7.9      Mandatory prepayment and cancellation following non-compliance with Sanctions

 

If the Borrowers or any Obligor is at any time not in compliance with the provisions of clause 21.11 (Sanctions) or at any time when a representation made or repeated under clause 18.34 (Sanctions) is not true, correct or accurate, then, without prejudice to any other rights of the Finance Parties under this Agreement and the other Finance Documents:

 

(a)        the Commitment of each Lender will be immediately cancelled; and

 

(b)        the Borrowers shall repay each Lender’s participation in the Advances on the earlier of (i) the date falling five (5) Business Days after the Agent notifies the Borrowers of such non-compliance and (ii) the date falling five (5) Business Days after the Borrowers become aware of such non-compliance and (iii) the last day of the Interest Period falling after the said non-compliance has occurred.

 

7.10    Mandatory prepayment as a result of unlawfulness and invalidity

 

If:

 

(a)        it is or becomes unlawful for an Obligor to perform any of its obligations under the Finance Documents or any Security Interest created or expressed to be created or evidenced by the Security Documents ceases to be effective;

 

(b)        any obligation or obligations of any Obligor under any Finance Documents are not (subject to the Legal Reservations) or cease to be legal, valid, binding or enforceable and the cessation individually or cumulatively materially and adversely affects the interests of the Lenders under the Finance Documents;

 

(c)        any Finance Document or any Security Interest created or expressed to be created or evidenced by the Security Documents ceases to be in full force and effect or is alleged by any party to it (other than a Finance Party) to be ineffective for any reason; or

 

(d)        any Security Document does not create legal, valid, binding and enforceable security over the assets charged under that Security Document or the ranking or priority of such security is adversely affected,

 

the Commitment of each Lender will be immediately cancelled the Borrowers shall repay each Lender’s participation in the Advances on the earlier of (i) the date falling five (5) Business Days after the Agent notifies the Borrowers of such non-compliance and (ii) the date falling five (5) Business Days after the Borrowers become aware of such non-compliance and (iii) the last day of the Interest Period falling after the said non-compliance has occurred.

 

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8       Interest

 

8.1      Calculation of interest

 

The rate of interest on each Advance for its Interest Period is the percentage rate per annum which is the aggregate of the applicable:

 

(a)        Margin; and

 

(b)        LIBOR.

 

8.2      Payment of interest

 

The Borrowers shall pay accrued interest on each Advance on the last day of each Interest Period for that Advance (and, if an Interest Period is longer than six (6) months, on the dates falling at six (6) monthly intervals after the first day of that Interest Period).

 

8.3      Default interest

 

(a)        If an Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the overdue amount from the due date up to the date of actual payment (both before and after judgment) at a rate which, subject to clause 8.3(b) below, is 2 per cent. per annum higher than the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted an Advance for successive Interest Periods, each of a duration selected by the Agent (acting reasonably). Any interest accruing under this clause 8.3 shall be immediately payable by the Obligors on demand by the Agent.

 

(b)        If any overdue amount consists of all or part of an Advance which became due on a day which was not the last day of an Interest Period relating to such Advance or the relevant part of it:

 

(i)         the first Interest Period for that overdue amount shall have a duration equal to the unexpired portion of the current Interest Period relating to such Advance; and

 

(ii)        the rate of interest applying to the overdue amount during that first Interest Period shall be 2 per cent. per annum higher than the rate which would have applied if the overdue amount had not become due.

 

(c)        Default interest (if unpaid) arising on an overdue amount will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

 

8.4      Notification of rates of interest

 

The Agent shall promptly notify the Lenders and the Borrowers of the determination of a rate of interest under this Agreement.

 

9       Interest Periods

 

9.1      Interest Periods

 

(a)        Subject to this clause 9, the Interest Period for an Advance shall be six (6) months, unless otherwise agreed by the Borrowers and all Lenders. No Interest Period for any Advance shall extend beyond the Final Repayment Date.

 

(b)        The first Interest Period for each Advance shall start on the relevant Utilisation Date for that Advance and each subsequent Interest Period for such Advance shall start on the last day of its preceding Interest Period

 

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(c)        The first and subsequent Interest Period for each Advance (other than the first Advance to be drawn) will end on the same day as the current Interest Period for any other Advance. On the last day of those Interest Periods, those Advances will be consolidated and treated as one Loan.

 

(d)        If the Borrowers select and the Lenders agree an Interest Period in respect of an Advance which would overrun any later Repayment Date for that Advance, the relevant Advance shall be divided into parts corresponding to the amounts by which that Advance is scheduled to be repaid under clause 6.2 (Scheduled repayment of Facility) on each of the Repayment Dates for that Advance falling during such Interest Period (each of which shall have a separate Interest Period ending on the relevant Repayment Date) and to the balance of that Advance (which shall have the Interest Period selected by the Borrowers).

 

9.2    Non-Business Days

 

If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

 

10    Changes to the calculation of interest

 

10.1    Unavailability of Screen Rate

 

(a)        If no Screen Rate is available for LIBOR for an Interest Period, LIBOR shall be the Interpolated Screen Rate for a period equal in length to that Interest Period.

 

(b)        If no Screen Rate is available for LIBOR for:

 

(i)         dollars; or

 

(ii)        the relevant Interest Period and it is not possible to calculate the Interpolated Screen Rate,

 

(iii)       there shall be no LIBOR for that Interest Period and clause 10.3 (Cost of funds) shall apply for that Interest Period.

 

10.2    Market disruption

 

If before close of business in London on the Quotation Day for an Interest Period the Agent receives notifications from a Lender or Lenders (whose aggregate participations in the Total Commitments exceed 50 per cent of the Total Commitments) that the cost to it of funding its participation in the Loan from whatever source it may reasonably select would be in excess of LIBOR then clause 10.3 (Cost of funds) shall apply to the Loan for the relevant Interest Period.

 

10.3    Cost of funds

 

(a)        The rate of interest on each Lender’s share of the Loan for the Interest Period shall be the percentage rate per annum which is the sum of:

 

(i)         the applicable Margin; and

 

(ii)        the rate notified to the Agent by that Lender as soon as practicable and in any event by close of business on the date falling ten (10) Business Days after the Quotation Day (or, if earlier, on the date falling ten Business Days before the date on which interest is due to be paid in respect of that Interest Period), to be that which expresses as a percentage rate per annum the cost to the relevant Lender of funding its participation in the Loan from whatever source it may reasonably select.

 

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(b)        If this clause 10.3 applies and the Agent or the Parent so requires, the Agent and the Parent shall enter into negotiations (for a period of not more than 30 days) with a view to agreeing a substitute basis for determining the rate of interest. If a substitute basis for determining the rate of interest is not agreed, paragraph (a) shall apply.

 

(c)        Subject to clause 41.8 (Replacement of Screen Rate), any alternative basis agreed pursuant to paragraph (b) above shall, with the prior consent of all the Lenders and the Parent, be binding on all Parties.

 

(d)        If this clause 10.3 applies pursuant to clause 10.2 (Market disruption) and:

 

(i)         a Lender’s Funding Rate is less than LIBOR; or

 

(ii)        a Lender does not supply a quotation by the time specified in paragraph (a)(ii) above,

 

the cost to that Lender of funding its participation in the Loan for that Interest Period shall be deemed, for the purposes of paragraph (a) above, to be LIBOR.

 

10.4    Notification to Parent

 

If clause 10.3 (Cost of funds) applies, the Agent shall, as soon as is practicable, notify the Parent.

 

10.5    Break Costs

 

(a)        The Borrowers shall, within three (3) Business Days of demand by a Finance Party, pay to that Finance Party its Break Costs attributable to all or any part of an Advance or Unpaid Sum being paid by the Borrowers (or, if relevant, any Group Member) on a day other than the last day of an Interest Period for that Advance or Unpaid Sum or relevant part of it.

 

(b)        Each Lender shall, as soon as reasonably practicable after a demand by the Agent, provide a certificate confirming the amount of its Break Costs for any Interest Period in which they accrue.

 

11    Fees

 

11.1    Commitment fee

 

(a)        The Borrowers shall pay to the Agent (for the account of each Lender) a fee in dollars on the undrawn and uncancelled portion of each Lender’s Commitment under the Facility, computed at the rate per annum of 0.675% per annum (being 25 per cent of the Margin) calculated on a daily basis from the date of this Agreement.

 

(b)        The Borrowers shall pay the accrued commitment fee on the last day of the period of three (3) months commencing on the date of this Agreement, on the last day of each successive period of three months, on the Last Availability Date and, if cancelled in full, on the cancelled amount of the relevant Lender’s Commitment at the time the cancellation is effective.

 

(c)        No commitment fee is payable to the Agent (for the account of a Lender) on any undrawn Commitments of that Lender for any day on which that Lender is a Defaulting Lender.

 

11.2    Other fees

 

The Borrowers shall pay any other fees set out in a Fee Letter in the amount and at the times agreed in the applicable Fee Letter.

 

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12    Tax gross-up and indemnities

 

12.1    Definitions

 

(a)       In this Agreement:

 

Protected Party means a Finance Party or, in relation to clause 14.4 (Indemnity concerning security) and clause 14.7 (Interest) insofar as it relates to interest on any amount demanded by that Indemnified Person under clause 14.4 (Indemnity concerning security), any Indemnified Person, which is or will be subject to any liability, or required to make any payment, for or on account of Tax in relation to a sum received or receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a Finance Document.

 

Tax Credit means a credit against, relief or remission for, or repayment of any Tax.

 

Tax Deduction means a deduction or withholding for or on account of Tax from a payment under a Finance Document, other than a FATCA Deduction.

 

Tax Payment means either the increase in a payment made by an Obligor to a Finance Party under clause 12.2 (Tax gross-up) or a payment under clause 12.3 (Tax indemnity).

 

(b)       Unless a contrary indication appears, in this clause 12 a reference to determines or determined means a determination made in the absolute discretion of the person making the determination.

 

12.2    Tax gross-up

 

(a)       Each Obligor shall make all payments to be made by it under any Finance Document without any Tax Deduction, unless a Tax Deduction is required by law.

 

(b)       The Borrowers shall, promptly upon any of them becoming aware that an Obligor must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction), notify the Agent accordingly. Similarly, a Lender shall notify the Agent on becoming so aware in respect of a payment payable to that Lender.  If the Agent receives such notification from a Lender it shall notify the Borrowers and that Obligor.

 

(c)       If a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor under the relevant Finance Document shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.

 

(d)       If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.

 

(e)       Within 30 days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to the Agent for the Finance Party entitled to the payment evidence reasonably satisfactory to that Finance Party that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

 

12.3    Tax indemnity

 

(a)       Each Obligor shall (within three (3) Business Days of demand by the Agent) pay to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of a Finance Document.

 

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(b)       Clause 12.3(a) above shall not apply:

 

(i)         with respect to any Tax assessed on a Finance Party:

 

(A)       under the law of the jurisdiction in which that Finance Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Finance Party is treated as resident for tax purposes; or

 

(B)       under the law of the jurisdiction in which that Finance Party’s Facility Office is located in respect of amounts received or receivable in that jurisdiction,

 

if that Tax is imposed on or calculated by reference to the overall net income received or receivable (but not any sum deemed to be received or receivable) by that Finance Party; or

 

(ii)        to the extent a loss, liability or cost is compensated for by an increased payment under clause 12.2 (Tax gross-up), clause 12.7 (Stamp taxes) or clause 12.8 (Value added tax);

 

(iii)       to the extent a loss, liability or cost is compensated for by a payment under clause 12.4 (Indemnities on after Tax basis); or

 

(iv)       to the extent a loss, liability or cost relates to a FATCA Deduction required to be made by a Party.

 

(c)       A Protected Party making, or intending to make a claim under clause 12.3(a) above shall promptly notify the Agent of the event which will give, or has given, rise to the claim, following which the Agent shall notify the Borrowers and the Guarantors.

 

(d)       A Protected Party shall, on receiving a payment from an Obligor under this clause 12.3, notify the Agent.

 

12.4    Indemnities on after Tax basis

 

(a)       If and to the extent that any sum payable to any Protected Party by the Borrowers under any Finance Document by way of indemnity or reimbursement proves to be insufficient, by reason of any Tax suffered thereon, for that Protected Party to discharge the corresponding liability to a third party, or to reimburse that Protected Party for the cost incurred by it in discharging the corresponding liability to a third party, the Borrowers shall pay that Protected Party such additional sum as (after taking into account any Tax suffered by that Protected Party on such additional sum) shall be required to make up the relevant deficit.

 

(b)       If and to the extent that any sum (the Indemnity Sum) constituting (directly or indirectly) an indemnity to any Protected Party but paid by the Borrowers to any person other than that Protected Party, shall be treated as taxable in the hands of the Protected Party, the Borrowers shall pay to that Protected Party such sum (the Compensating Sum) as (after taking into account any Tax suffered by that Protected Party on the Compensating Sum) shall reimburse that Protected Party for any Tax suffered by it in respect of the Indemnity Sum.

 

12.5    FATCA Information

 

(a)       Subject to clause 12.5(c) below, each Party shall, within ten Business Days of a reasonable request by another Party:

 

(i)         confirm to that other Party whether it is:

 

(A)       a FATCA Exempt Party; or

 

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(B)       not a FATCA Exempt Party;

 

(ii)        supply to that other Party such forms, documentation and other information relating to its status under FATCA as that other Party reasonably requests for the purposes of that other Party’s compliance with FATCA; and

 

(iii)       supply to that other Party such forms, documentation and other information relating to its status as that other Party reasonably requests for the purposes of that other Party’s compliance with any other law, regulation or exchange of information regime.

 

(b)       If a Party confirms to another Party pursuant to clause 12.5(a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that Party shall notify that other Party reasonably promptly.

 

(c)       Clause 12.5(a) above shall not oblige any Finance Party to do anything, and clause 12.5(a)(iii) above shall not oblige any other Party to do anything, which would or might in its reasonable opinion constitute a breach of:

 

(i)         any law or regulation;

 

(ii)        any fiduciary duty; or

 

(iii)       any duty of confidentiality.

 

(d)       If a Party fails to confirm whether or not it is a FATCA Exempt Party or to supply forms, documentation or other information requested in accordance with clause 12.5(a)(i) or clause 12.5(a)(ii) above (including, for the avoidance of doubt, where clause 12.5(c) above applies), then such Party shall be treated for the purposes of the Finance Documents (and payments under them) as if it is not a FATCA Exempt Party until such time as the Party in question provides the requested confirmation, forms, documentation or other information.

 

(e)       If a Borrower is a US Tax Obligor, or the Agent reasonably believes that its obligations under FATCA or any other applicable law or regulation require it, each Lender shall, within ten Business Days of:

 

(i)         where a Borrower is a US Tax Obligor and the relevant Lender is an Original Lender, the date of this Agreement;

 

(ii)        where a Borrower is a US Tax Obligor on a Transfer Date and the relevant Lender is a New Lender, the relevant Transfer Date; or

 

(iii)       the date a new US Tax Obligor accedes as a Borrower; or

 

(iv)       where the Borrower is not a US Tax Obligor, the date of a request from the Agent,

 

supply to the Agent:

 

(A)       a withholding certificate on Form W-8 or Form W-9 or any other relevant form; or

 

(B)       any withholding statement and other documentation, authorisation or waiver as the Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation.

 

(f)        The Agent shall provide any withholding certificate, withholding statement, documentation, authorisation or waiver it receives from a Lender pursuant to this paragraph (e) to the Borrowers.

 

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(g)       If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Agent by a Lender pursuant to paragraph (e) above is or becomes materially inaccurate or incomplete, that Lender shall promptly update it and provide such updated withholding certificate, withholding statement, document, authorisation or waiver to the Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify the Agent). The Agent shall provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the relevant Borrower.

 

(h)       The Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraphs (e) or (g) above without further verification. The Agent shall not be liable for any action taken by it under or in connection with paragraphs (e), (f) or (g) above.

 

12.6    FATCA Deduction

 

(a)       Each Party may make any FATCA Deduction it is required by FATCA to make, and any payment required in connection with that FATCA Deduction, and no Party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

 

(b)       Each Party shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction), notify the Party to whom it is making the payment and, in addition, shall notify the Borrowers and the Agent and the Agent shall notify the other Finance Parties.

 

12.7    Stamp taxes

 

The Borrowers shall pay and, within three (3) Business Days of demand, indemnify each Finance Party against any cost, loss or liability that Finance Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document provided that this clause 12.7 shall not apply in respect of any such stamp duty or Tax which is payable in respect of an assignment or transfer by a Finance Party of any of its rights and/or obligations under any Finance Document, except as such assignment or transfer is required by the terms of the Finance Documents, in terms of which this clause 12.7 shall apply in any event.

 

12.8    Value added tax

 

(a)       All amounts set out, or expressed in a Finance Document to be payable by any party to a Finance Party which (in whole or in part) constitute the consideration for any supply for supplies for VAT purposes shall be deemed to be exclusive of any VAT which is chargeable on such supply or supplies, and accordingly, subject to clause 12.8(b) below, if VAT is or becomes chargeable on any supply made by any Finance Party to any party under a Finance Document, that party shall pay to the Finance Party (in addition to and at the same time as paying any other consideration for such supply) an amount equal to the amount of such VAT (and such Finance Party shall promptly provide an appropriate VAT invoice to such party).

 

(b)       If VAT is or becomes chargeable on any supply made by any Finance Party (the Supplier) to any other Finance Party (the Recipient) under a Finance Document, and any party to a Finance Document other than the Recipient (the Subject Party) is required by the terms of any Finance Document to pay an amount equal to the consideration for such supply to the Supplier (rather than being required to reimburse or indemnify the Recipient in respect of that consideration):

 

(i)         (where the Supplier is the person required to account to the relevant tax authority for the VAT) the Subject Party must also pay to the Supplier (at the same time as paying that amount) an additional amount equal to the amount of the VAT.  The Recipient must (where this paragraph (a) applies) promptly pay to the Subject Party an amount equal to any credit or repayment the Recipient receives from the

 

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relevant tax authority which the Recipient reasonably determines relates to the VAT chargeable on that supply; and

 

(ii)        (where the Recipient is the person required to account to the relevant tax authority for the VAT) the Subject Party must promptly, following demand from the Recipient, pay to the Recipient an amount equal to the VAT chargeable on that supply but only to the extent that the Recipient reasonably determines that it is not entitled to credit or repayment from the relevant tax authority in respect of that VAT.

 

(c)       Where a Finance Document requires any party to it to reimburse or indemnify a Finance Party for any cost or expense, that party shall reimburse or indemnify (as the case may be) such Finance Party for the full amount of such cost or expense, including such part thereof as represents VAT save to the extent that such Finance Party reasonably determines that it is entitled to credit or repayment of in respect of such VAT from the relevant tax authority.

 

(d)       Any reference in this clause 12.8 to any Party shall, at any time when such Party is treated as a member of a group for VAT purposes, include (where appropriate and unless the context otherwise requires) a reference to the representative member of such group at such time (the term “representative member” to have the same meaning as in the Value Added Tax Act 1994).

 

(e)       In relation to any supply made by a Finance Party to any party under a Finance Document, if reasonably requested by such Finance Party, that party must promptly provide such Finance Party with details of that party’s VAT registration and such other information as is reasonably requested in connection with such Finance Party’s VAT reporting requirements in relation to such supply.

 

12.9    Tax Credit

 

If an Obligor makes a Tax Payment and the relevant Finance Party determines that:

 

(a)       a Tax Credit is attributable to an increased payment of which that Tax Payment forms part, to that Tax Payment or to a Tax Deduction in consequence of which that Tax Payment was required; and

 

(b)       that Finance Party has obtained and utilised that Tax Credit in whole or in part,

 

the Finance Party shall pay an amount to the Obligor which that Finance Party determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by the Obligor.

 

13    Increased Costs

 

13.1    Increased Costs

 

(a)       Subject to clause 13.3 (Exceptions), the Borrowers shall, within three (3) Business Days of a demand by the Agent, pay for the account of a Finance Party the amount of any Increased Cost incurred by that Finance Party or any of its Affiliates which:

 

(i)         arises as a result of (A) the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation or (B) compliance with any law or regulation made after the date of this Agreement; and/or

 

(ii)        is a Basel III Increased Cost and is generally ascribed to borrowers as a matter of market practice.

 

(b)       In this Agreement Increased Costs means:

 

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(i)         a reduction in the rate of return from the Facility or on a Finance Party’s (or its Affiliate’s) overall capital;

 

(ii)        an additional or increased cost; or

 

(iii)       a reduction of any amount due and payable under any Finance Document,

 

which is incurred or suffered by a Finance Party or any of its Affiliates to the extent that it is attributable to that Finance Party having entered into its Commitments or funding or performing its obligations under any Finance Document.

 

13.2    Increased Cost claims

 

(a)       A Finance Party intending to make a claim pursuant to clause 13.1 (Increased Costs) shall notify the Agent of the event giving rise to the claim, following which the Agent shall promptly notify the Borrowers.

 

(b)       Each Finance Party shall, as soon as practicable after a demand by the Agent, provide a certificate confirming the amount and basis of calculation of its Increased Costs.

 

13.3    Exceptions

 

(a)       Clause 13.1 (Increased Costs) does not apply to the extent any Increased Cost is:

 

(i)         attributable to a Tax Deduction required by law to be made by an Obligor;

 

(ii)      compensated for by clause 12.3 (Tax indemnity) (or would have been compensated for under clause 12.3 (Tax indemnity) but was not so compensated solely because any of the exclusions in clause 12.3(b) applied);

 

(iii)       attributable to a FATCA Deduction required to be made by a Party; or

 

(iv)       attributable to the wilful breach by the relevant Finance Party or its Affiliates of any law or regulation;

 

(b)       In this clause 13.3, a reference to a Tax Deduction has the same meaning given to the term in clause 12.1 (Definitions).

 

14    Other indemnities

 

14.1    Currency indemnity

 

(a)       If any sum due from an Obligor under the Finance Documents (a Sum), or any order, judgment or award given or made in relation to a Sum, has to be converted from the currency (the First Currency) in which that Sum is payable into another currency (the Second Currency) for the purpose of:

 

(i)         making or filing a claim or proof against that Obligor; and/or

 

(ii)       obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,

 

that Obligor shall, as an independent obligation, within three (3) Business Days of demand by a Finance Party, indemnify each Finance Party to whom that Sum is due against any Losses arising out of or as a result of the conversion including any discrepancy between (i) the rate of exchange used to convert that Sum from the First Currency into the Second Currency and (ii) the rate or rates of exchange available to that person at the time of its receipt of that Sum.

 

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(b)       Each Obligor waives any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency or currency unit other than that in which it is expressed to be payable.

 

14.2    Other indemnities

 

(a)       The Borrowers shall (or shall procure that another Obligor will), within three (3) Business Days of demand by a Finance Party, indemnify each Finance Party against any and all Losses incurred by that Finance Party (as the case may be) as a result of:

 

(i)         the occurrence of any Event of Default;

 

(ii)        a failure by an Obligor to pay any amount due under a Finance Document on its due date, including without limitation, any and all Losses arising as a result of clause 34 (Sharing among the Finance Parties);

 

(iii)       funding, or making arrangements to fund, its participation in the Loan requested by the Borrowers in a Utilisation Request but not made by reason of the operation of any one or more of the provisions of this Agreement (other than by reason of default or negligence by that Finance Party alone);

 

(iv)       the Loan (or part of the Loan) not being prepaid in accordance with a notice of prepayment given by the Borrowers.

 

(b)       The Borrowers shall (or shall procure that another Obligor will), within three (3) Business Days of demand by an Indemnified Person, indemnify each Indemnified Person against any and all Losses, joint or several that may be incurred by or asserted or awarded against any Indemnified Person, in each case arising out of or in connection with or relating to any claim investigation, litigation or proceeding (or the preparation of any defence with respect thereto) commenced or threatened in relation to this Agreement (or the transactions contemplated hereby) or any use made or proposed to be made with the proceeds of any Facility (including an Environmental Claim made or asserted against such Indemnified Person if such Environmental Claim would not have been, or been capable of being, made or asserted against such Indemnified Person if the Finance Parties had not entered into any of the Finance Documents and/or exercised any of their rights, powers and discretions thereby conferred and/or performed any of their obligations thereunder and/or been involved in any of the transactions contemplated by the Finance Documents). This indemnity shall apply whether or not such claims, investigation, litigation or proceedings is brought by any Obligor, any other Group Member or any of their member(s) or (as the case may be) shareholders, their Affiliates, or creditors, or an Indemnified Person or any other person, or an Indemnified Person is otherwise a party thereto, except to the extent such Losses are found in a final non-appealable judgement by a court of competent jurisdiction to have resulted from such Indemnified Person’s gross negligence or wilful default. Each Indemnified Person may enforce and enjoy the benefit of this clause 14.2 under the Third Parties Act.

 

14.3    Indemnity to the Agent and Security Agent

 

The Borrowers shall promptly indemnify the Agent and Security Agent against:

 

(a)       any and all Losses incurred by the Agent or the Security Agent (acting reasonably) as a result of:

 

(i)         without prejudice to clause 32.7(b)(i) as extended to the Security Agent by clause 32.21 (Application of certain clauses to Security Agent), investigating any event which it reasonably believes is a Default;

 

(ii)        acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised;

 

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(iii)       instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under this Agreement; or

 

(iv)       any action taken by the Agent or the Security Agent or any of its or their representatives, agents or contractors in connection with any powers conferred by any Security Document to enforce any Security Interest thereunder or to remedy any breach of any Obligor’s obligations under the Finance Documents; and

 

(b)        any cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by the Agent or the Security Agent (otherwise than by reason of the Agent’s or the Security Agent’s gross negligence or wilful default) (or, in the case of any cost, loss or liability pursuant to clause 35.11 (Disruption to Payment Systems etc.) notwithstanding the Agent’s or the Security Agent’s negligence, gross negligence or any other category of liability whatsoever but not including any claim based on the fraud of the Agent in acting as Agent or the Security Agent under the Finance Documents).

 

14.4    Indemnity concerning security

 

(a)       The Borrowers shall (or shall procure that another Obligor will) promptly indemnify each Indemnified Person against any and all Losses incurred by it in connection with:

 

(i)         any failure by the Borrowers to comply with clause 16 (Costs and expenses);

 

(ii)        acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised;

 

(iii)       the taking, holding, protection or enforcement of the Security Documents;

 

(iv)       the exercise or purported exercise of any of the rights, powers, discretions, authorities and remedies vested in the Security Agent and/or any other Finance Party and each Receiver and each Delegate by the Finance Documents or by law unless and to the extent that it was caused by its gross negligence or wilful default;

 

(v)        any claim (whether relating to the environment or otherwise) made or asserted against the Indemnified Person which would not have arisen but for the execution or enforcement of one or more Finance Documents (unless and to the extent it is caused by the gross negligence or wilful default of that Indemnified Person); or

 

(vi)       any breach by any Obligor of the Finance Documents.

 

(b)       The Security Agent may, in priority to any payment to the other Finance Parties, indemnify itself out of the Trust Property in respect of, and pay and retain, all sums necessary to give effect to the indemnity in this clause 14.4 and shall have a lien on the Security Documents and the proceeds of the enforcement of those Security Documents for all moneys payable to it.

 

14.5    Continuation of indemnities

 

The indemnities by the Borrowers in favour of the Indemnified Persons contained in this Agreement shall continue in full force and effect notwithstanding any breach by any Finance Party or any of the Borrowers of the terms of this Agreement, the repayment or prepayment of the Loan, the cancellation of the Total Commitments or the repudiation by the Agent or any of the Borrowers of this Agreement.

 

14.6    Third Parties Act

 

Each Indemnified Person may rely on the terms of clause 14.4 (Indemnity concerning security) and clauses 12 (Tax gross-up and indemnities) and 14.7 (Interest) insofar as it relates to

 

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interest on any amount demanded by that Indemnified Person under clause 14.4 (Indemnity concerning security), subject to clause 1.3 (Third party rights) and the provisions of the Third Parties Act.

 

14.7    Interest

 

Moneys becoming due by the Borrowers to any Indemnified Person under the indemnities contained in this clause 14 or elsewhere in this Agreement shall be paid on demand made by such Indemnified Person and shall be paid together with interest on the sum demanded from the date of demand therefor to the date of reimbursement by the Borrowers to such Indemnified Person (both before and after judgment) at the rate referred to in clause 8.3 (Default interest).

 

14.8    Exclusion of liability

 

Without prejudice to any other provision of the Finance Documents excluding or limiting the liability of any Indemnified Person, no Indemnified Person will be in any way liable or responsible to any Obligor (whether as mortgagee in possession or otherwise) who is a Party or is a party to a Finance Document to which this clause applies for any loss or liability arising from any act, default, omission or misconduct of that Indemnified Person, except to the extent caused by its own gross negligence or wilful default. Any Indemnified Person may rely on this clause 14.8 subject to clause 1.3 (Third party rights) and the provisions of the Third Parties Act.

 

14.9    Email indemnity

 

The Borrowers shall indemnify each Finance Party against any and all Losses together with any VAT thereon which any of the Finance Parties may sustain or incur as a consequence of any email communication purporting to originate from the Borrowers to the Agent or the Security Agent being made or delivered fraudulently or without proper authorisation (unless such Losses are the direct result of the gross negligence or wilful default of the relevant Finance Party or the Agent or the Security Agent).

 

14.10  Waiver

 

In no event shall any of the Finance Parties be liable on any theory of liability for any special, indirect, consequential or punitive damages and the Obligors hereby waive, release and agree (for and on behalf of themselves and on behalf of the other Group Members and their respective Affiliates and shareholders) not to sue upon any such claim for any such damages, whether or not accrued and whether or not known or suspected to exist in their favour.

 

15    Mitigation by the Lenders

 

15.1    Mitigation

 

(a)       Each Finance Party shall, in consultation with the Borrowers, take all reasonable steps to mitigate any circumstances which arise and which would result in any Facility ceasing to be available or any amount becoming payable under or pursuant to, or cancelled pursuant to, any of clause 7.1 (Illegality), clause 12 (Tax gross-up and indemnities), clause 13 (Increased Costs) including (but not limited to) assigning its rights under the Finance Documents to another Affiliate or Facility Office.

 

(b)       Clause 15.1(a) does not in any way limit the obligations of any Obligor under the Finance Documents.

 

15.2    Limitation of liability

 

(a)       The Borrowers shall promptly indemnify each Finance Party for all costs and expenses incurred by that Finance Party as a result of steps taken by it under clause 15.1 (Mitigation).

 

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(b)       A Finance Party is not obliged to take any steps under clause 15.1 (Mitigation) if, in the opinion of that Finance Party (acting reasonably), to do so might be prejudicial to it.

 

16    Costs and expenses

 

16.1    Transaction expenses

 

The Borrowers shall promptly within five (5) Business Days of demand pay the Agent, the Arrangers and the Security Agent the amount of all costs and expenses (including fees, costs and expenses of legal advisers and insurance and other consultants and advisers) reasonably incurred by any of them (and by any Receiver or Delegate) in connection with the negotiation, preparation, printing, execution, syndication, registration and perfection and any release, discharge or reassignment of:

 

(a)       this Agreement, any other documents referred to in this Agreement and the Original Security Documents;

 

(b)       any other Finance Documents executed or proposed to be executed after the date of this Agreement including any document executed to provide additional security under clause 25 (Minimum security value); or

 

(c)       any Security Interest expressed or intended to be granted by a Finance Document,

 

whether or not the transactions contemplated under the Finance Documents are consummated.

 

16.2    Amendment costs

 

If an Obligor requests an amendment, waiver or consent, the Borrowers shall, within five (5) Business Days of demand by the Agent, reimburse the Agent for the amount of all costs and expenses (including fees, costs and expenses of legal advisers and (subject to clause 24.17 (Independent report) insurance and other consultants and advisers) reasonably incurred by the Agent or the Security Agent (and by any Receiver or Delegate) in responding to, evaluating, negotiating or complying with that request or requirement.

 

16.3    Valuations and inspection costs

 

The Borrowers shall, on demand by a Finance Party, pay to each Finance Party (through the Agent, except where a payment is to be made to the Security Agent, in which case such payment shall be made directly to the Security Agent), the amount of all costs and expenses (including fees, costs and expenses of legal advisers and insurance and other consultants, brokers, surveyors and advisers) reasonably incurred by that Finance Party in connection with:

 

(a)       any valuation carried out under clause 25 (Minimum security value) at the times provided in such clauses that the relevant costs must be borne by the Borrowers; or

 

(b)       any inspection carried out under clause 23.8 (Inspection and notice of drydockings) or any survey carried out under clause 23.16 (Survey report).

 

16.4    Enforcement and preservation costs

 

The Borrowers shall, on demand by a Finance Party, pay to each Finance Party (through the Agent, except where a payment is to be made to the Security Agent, in which case such payment shall be made directly to the Security Agent), the amount of all costs and expenses (including fees, costs and expenses of legal advisers and insurance and other consultants, brokers, surveyors and advisers) incurred by that Finance Party in connection with the enforcement of, or the preservation of any rights under, any Finance Document and any proceedings initiated by or against any Indemnified Person and as a consequence of holding the Charged Property or enforcing those rights and any proceedings instituted by or against any Indemnified Person as a consequence of taking or holding the Security Documents or enforcing those rights.

 

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17    Guarantee and indemnity

 

17.1    Guarantee and indemnity

 

Each Guarantor hereby irrevocably and unconditionally and jointly and severally with the other Guarantors:

 

(a)       guarantees to the Security Agent (as trustee for the Finance Parties) and the other Finance Parties punctual performance by each other Obligor of all such Obligor’s obligations under the Finance Documents;

 

(b)       undertakes with the Security Agent (as trustee for the Finance Parties) and the other Finance Parties that whenever another Obligor does not pay any amount when due under or in connection with any Finance Document, it shall immediately on demand pay that amount as if it was the principal obligor; and

 

(c)       agrees with the Security Agent (as trustee for the Finance Parties) and the other Finance Parties that it will, as an independent and primary obligation, indemnify each Finance Party immediately on demand against any cost, loss or liability it incurs:

 

(i)

 

(A)       if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal; or

 

(B)       by operation of law,

 

and as a result of the same the Borrowers have not paid any amount which would, but for such unenforceability, invalidity, illegality or operation of law, have been payable by the Borrowers under any Finance Document on the date when it would have been due; or

 

(ii)        if as a result (directly or indirectly) of the introduction of or any change in (or the interpretation, administration or application of) any law or regulation, or compliance with any law, regulation or administrative procedure made after entry into this Agreement (a Change in Law), there is a change in the currency, the value of the currency or the timing, place or manner in which any obligation guaranteed by a Guarantor is payable.

 

The amount payable by a Guarantor under this indemnity:

 

(1)       in respect of paragraph (i) above, shall be the amount it would have had to pay under this clause 17.1 if the amount claimed had been recoverable on the basis of a guarantee but for any relevant unenforceability, invalidity or illegality, and

 

(2)       in respect of paragraph (ii) above, shall include (aa) the difference between (x) the amount (if any) received by the Security Agent and the other Finance Parties from the Borrowers and (y) the amount that the Borrowers were obliged to pay under the original express terms of the Finance Documents in the currency specified in the Finance Documents, disregarding any Change in Law (the Original Currency), and (bb) all further costs, losses and liabilities suffered or incurred by the Security Agent and the other Finance Parties as a result of a Change in Law.

 

For the purposes of (aa)(x) above, if payment was not received by the Security Agent or the other Finance Parties in the Original Currency, the amount received by the Security Agent and the other Finance Parties shall be deemed to be that payment’s equivalent in the Original Currency converted, actually or notionally at the Security Agent’s discretion,

 

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on the day of receipt at the then prevailing spot rate of exchange of the Security Agent or if, in the Security Agent’s opinion, it could not reasonably or properly have made a conversion on the day of receipt of the equivalent of that payment in the Original Currency, that payment’s equivalent as soon as the Security Agent could, in its opinion, reasonably and properly have made a conversion of the Original Currency with the currency of payment.

 

If the Original Currency no longer exists, the Guarantor shall make such payment in such currency as is, in the reasonable opinion of the Security Agent, required, after taking into account any payments by the Borrowers, to place the Security Agent and the other Finance Parties in a position reasonably comparable to that it would have been in had the Original Currency continued to exist.

 

17.2    Continuing guarantee

 

This guarantee is a continuing guarantee and will extend to the ultimate balance of sums payable by any Obligor under the Finance Documents, regardless of any intermediate payment or discharge in whole or in part.

 

17.3    Reinstatement

 

If any payment is made by an Obligor, or any discharge, release or arrangement is given by a Finance Party (whether in respect of the obligations of any Obligor or any security for those obligations or otherwise) in whole or in part on the basis of any payment, security or other disposition, and the same is avoided or reduced or must be restored in, or as a result of, insolvency, liquidation, administration or any other similar event or otherwise, then:

 

(a)       the liability of each Guarantor under this clause 17 shall continue or be reinstated as if the payment, discharge, release, arrangement, avoidance or reduction had not occurred; and

 

(b)       each Finance Party shall be entitled to recover the value or amount of that security or payment from each Obligor, as if the payment, discharge, release, arrangement, avoidance or reduction had not occurred.

 

17.4    Waiver of defences

 

The obligations of each Guarantor under this clause 17 will not be affected by an act, omission, matter or thing (whether or not known to it or any Finance Party) which, but for this clause, would reduce, release or prejudice any of its obligations under this clause 17 including (without limitation):

 

(a)       any time, waiver or consent granted to, or composition with, any Obligor or other person;

 

(b)       the release of any other Obligor or any other person under the terms of any composition or arrangement with any creditor of any other Obligor;

 

(c)       the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, any Obligor or other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

 

(d)       any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of an Obligor or any other person;

 

(e)       any amendment, novation, supplement, extension, restatement (however fundamental and whether or not more onerous) or replacement of any Finance Document or any other document or security including without limitation any change in the purpose of, any extension of or any increase in any facility or the addition of any new facility under any Finance Document or other document or security;

 

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(f)        any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security;

 

(g)       any law of regulation of any jurisdiction or any other event affecting any term of the guaranteed obligations;

 

(h)       any other circumstance that might constitute a defence of the Guarantor; or

 

(i)         any insolvency or similar proceedings.

 

17.5    Guarantor intent

 

Without prejudice to the generality of clause 17.4 (Waiver of defences), each Guarantor expressly confirms that it intends that this guarantee shall extend from time to time to any (however fundamental) variation, increase, extension or addition of or to any of the Finance Documents and/or any facility or amount made available under any of the Finance Documents.

 

17.6    Immediate recourse

 

Each Guarantor waives any right it may have of first requiring any Finance Party (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before claiming from that Guarantor under this clause 17. This waiver applies irrespective of any law or any provision of a Finance Document to the contrary.

 

17.7    Appropriations

 

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full, each Finance Party (or any trustee or agent on its behalf) may:

 

(a)       refrain from applying or enforcing any other moneys, security or rights held or received by that Finance Party (or any trustee or agent on its behalf) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and no Guarantor shall be entitled to the benefit of the same; and

 

(b)       hold in an interest-bearing suspense account any moneys received from any Guarantor or on account of a Guarantor’s liability under this clause 17.

 

17.8    Deferral of Guarantors’ rights

 

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full and unless the Agent otherwise directs, no Guarantor will exercise any rights which it may have by reason of performance by it of its obligations under the Finance Documents or by reason of any amount being payable, or liability arising, under this clause 17:

 

(a)       to be indemnified or reimbursed by another Obligor;

 

(b)       to claim any contribution from any other guarantor of any Obligor’s obligations under the Finance Documents;

 

(c)       to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Finance Parties under the Finance Documents or of any other guarantee or security taken pursuant to, or in connection with, the Finance Documents by any Finance Party;

 

(d)       to bring legal or other proceedings for an order requiring any Obligor to make any payment, or perform any obligation, in respect of which that Guarantor has given a guarantee, undertaking or indemnity under clause 17 (Guarantee and indemnity);

 

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(e)       to exercise any right of set-off against any other Obligor; and/or

 

(f)        to claim or prove as a creditor of any other Obligor in competition with any Finance Party.

 

If a Guarantor receives any benefit, payment or distribution in relation to such rights it will promptly pay an equal amount to the Agent for application in accordance with clause 35 (Payment mechanics). This only applies until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full.

 

17.9    Additional security

 

This guarantee is in addition to and is not in any way prejudiced by any other guarantee or security now or subsequently held by any Finance Party.

 

17.10  Guarantors’ rights and obligations

 

(a)       The obligations of each Guarantor under the Guarantee and under this Agreement are joint and several. Failure by a Guarantor to perform its obligations under the Guarantee and/or this Agreement shall constitute a failure by all of the Guarantors.

 

(b)       Each Guarantor irrevocably and unconditionally jointly and severally with the other Guarantors:

 

(i)         agrees that it is responsible for the performance of the obligations of the other Guarantors under the Guarantee and this Agreement;

 

(ii)        acknowledges and agrees that it is a principal and original debtor in respect of all amounts due from the Guarantors under the Guarantee and under this Agreement; and

 

(iii)       agrees with each Finance Party that, if any obligation of another Guarantor under the Guarantee and this Agreement is or becomes unenforceable, invalid or illegal for any reason it will, as an independent and primary obligation, indemnify that Finance Party immediately on demand against any and all Losses it incurs as a result of such other Guarantor not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by such other Guarantor under the Guarantee and/or this Agreement. The amount payable under this indemnity shall be equal to the amount which that Finance Party would otherwise have been entitled to recover.

 

(c)       The obligations of each Guarantor under the Finance Documents shall continue until all amounts which may be or become payable by the Guarantors under or in connection with the Finance Documents have been irrevocably and unconditionally paid or discharged in full, regardless of any intermediate payment or discharge in whole or in part.

 

18    Representations

 

18.1    Each Obligor makes and repeats the representations and warranties set out in this clause 18 to each Finance Party at the times specified in clause 18.35 (Times when representations are made).

 

18.2    Where a representation or warranty is made in relation to a Manager, such representation or warranty shall not be so made in respect of the Shell Technical Manager and where the term “Manager” is used in this clause 18 (Representations), it shall be interpreted so as to exclude the Shell Technical Manager.

 

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18.3    Status

 

(a)       Each Obligor and each Manager is duly incorporated and validly existing or established under the laws of the jurisdiction of its incorporation or establishment as a limited liability company or corporation or limited partnership (as the case may be) and (other than an Obligor formed in the Marshall Islands) has no centre of main interests, permanent establishment or place of business outside the jurisdiction in which it is incorporated (save as notified to the Agent) and is in compliance with its Constitutional Documents.

 

(b)       Each Obligor and each Manager has power and authority to carry on its business as it is now being conducted and to own its property and other assets.

 

18.4    Binding obligations

 

Subject to the Legal Reservations, the obligations expressed to be assumed by each Obligor in each Finance Document and any Charter Document to which it is, or is to be, a party are or, when entered into by it, will be legal, valid, binding and enforceable obligations and each Security Document to which an Obligor is, or will be, a party, creates or will create the Security Interests which that Security Document purports to create and those Security Interests are or will be valid and effective.

 

18.5    Power and authority

 

(a)       Each Obligor has, or will have when entered into by it, power to enter into, perform and deliver and comply with its obligations under, and has taken, or will take when entered into by it, all necessary action to authorise its entry into, each Finance Document and any Charter Document to which it is, or is to be a party and each of the transactions contemplated by those documents.

 

(b)       No limitation on any Obligor’s powers to borrow, create security or give guarantees will be exceeded as a result of any transaction under, or the entry into of, any Finance Document or any Charter Document to which such Obligor is, or is to be, a party.

 

18.6    Non-conflict

 

The entry into and performance by each Obligor and any Manager of, and the transactions contemplated by the Finance Documents and the Charter Documents and the granting of the Security Interests purported to be created by the Security Documents do not and will not conflict with:

 

(a)       any law or regulation applicable to any Obligor or any Manager;

 

(b)       the Constitutional Documents of any Obligor or any Manager; or

 

(c)       any agreement or other instrument binding upon any Obligor or any Manager or its assets,

 

or constitute a default or termination event (however described) under any such agreement or instrument or result in the creation of any Security Interest (save for a Permitted Maritime Lien or under a Security Document) on any such Obligor’s or such Manager’s assets, rights or revenues.

 

18.7    Validity and admissibility in evidence

 

(a)       All authorisations required:

 

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