☐ |
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
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☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐ |
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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CASTOR MARITIME INC.
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(Exact name of Registrant as specified in its charter)
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(Translation of Registrant’s name into English)
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Republic of the Marshall Islands
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(Jurisdiction of incorporation or organization)
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223 Christodoulou Chatzipavlou Street
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Hawaii Royal Gardens
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3036 Limassol, Cyprus
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(Address of principal executive offices)
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Petros Panagiotidis, Chairman, Chief Executive Officer and Chief Financial
Officer
223 Christodoulou Chatzipavlou Street, Hawaii Royal Gardens, 3036 Limassol, CY
Phone number: + 357 25 357 767
Fax Number: +357 25 357 796
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(Name, Telephone, E-mail and/or Facsimile number and
Address of Company Contact Person)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Shares, $0.001 par value
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CTRM
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Preferred Share Purchase Rights under Stockholders Rights Agreement
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☐ Yes
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☒ No
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☐ Yes
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☒ No
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☒ Yes
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☐ No
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☒ Yes
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☐ No
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Large accelerated filer ☐
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Accelerated filer ☐
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Non-accelerated filer ☐
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Emerging Growth Company ☒
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☒
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U.S. GAAP
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☐
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International Financial Reporting Standards as issued by the International Accounting Standards Board
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☐
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Other
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☐
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Item 17
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☐
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Item 18
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☐ Yes
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☒ No
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☐ Yes
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☐ No
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PAGE
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1 |
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ITEM 1.
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1 |
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ITEM 2.
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1 |
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ITEM 3.
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1 |
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ITEM 4.
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30 |
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ITEM 4A.
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47 |
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ITEM 5.
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47 |
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ITEM 6.
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66 |
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ITEM 7.
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67 |
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ITEM 8.
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69 |
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ITEM 9.
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70 |
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ITEM 10.
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70 |
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ITEM 11.
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81 |
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ITEM 12.
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82 |
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83 |
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ITEM 13.
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83 |
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ITEM 14.
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83 |
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ITEM 15.
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83 |
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ITEM 16.
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84 |
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ITEM 16A.
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84 |
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ITEM 16B.
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84 |
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ITEM 16C.
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85 |
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ITEM 16D.
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85 |
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ITEM 16E.
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85 |
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ITEM 16F.
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85 |
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ITEM 16G.
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85 |
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ITEM 16H.
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86 |
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ITEM 16I.
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86 |
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86 |
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ITEM 17.
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86 |
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ITEM 18.
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86 |
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ITEM 19.
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87 |
• |
our business strategy, expected capital spending and other plans and objectives for future operations;
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• |
dry bulk and tanker market conditions and trends, including volatility in charter rates, factors affecting supply and demand, fluctuating vessel values, opportunities for the profitable operations of dry bulk and tanker carriers and the
strength of world economies;
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• |
the rapid growth of our fleet, our ability to realize the expected benefits from our past or future vessel acquisitions, and the effects of our fleet’s growth on our future financial condition, operating results, future revenues and
expenses, future liquidity, and the adequacy of cash flows from our operations;
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• |
our relationships with our current and future service providers and customers, including the ongoing performance of their obligations, compliance with applicable laws, and any impacts on our reputation due to our association with them;
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• |
our ability to borrow under existing or future debt agreements or to refinance our debt on favorable terms and our ability to comply with the covenants contained therein, in particular due to economic, financial or operational reasons;
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• |
our continued ability to enter into time or voyage charters with existing and new customers, and to re-charter our vessels upon the expiry of the existing charters;
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• |
changes in our operating and capitalized expenses, including bunker prices, dry-docking, insurance costs, costs associated with regulatory compliance, and costs associated with climate change;
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• |
our ability to fund future capital expenditures and investments in the acquisition and refurbishment of our vessels (including the amount and nature thereof and the timing of completion thereof, the delivery and commencement of
operations dates, expected downtime and lost revenue);
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• |
instances of off-hire, including due to limitations imposed by COVID-19 and/or due to vessel upgrades and repairs;
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• |
future sales of our securities in the public market and our ability to maintain compliance with applicable listing standards;
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• |
volatility in our share price, including due to high volume transactions in our shares by retail investors;
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• |
potential conflicts of interest involving members of our Board of Directors, senior management and certain of our service providers that are related parties;
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• |
general domestic and international political conditions or events, including “trade wars”, global public health threats and major outbreaks of disease;
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• |
changes in seaborne and other transportation, including due to fluctuating demand for dry bulk and tanker vessels and/or disruption of shipping routes due to accidents, political events, international
hostilities and instability, piracy or acts of terrorism;
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• |
changes in governmental rules and regulations or actions taken by regulatory authorities, including changes to environmental regulations applicable to the shipping industry;
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• |
the impact of adverse weather and natural disasters; and
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• |
any other factor detailed in this annual report and from time to time in our reports.
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ITEM 1. |
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
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ITEM 2. |
OFFER STATISTICS AND EXPECTED TIMETABLE
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ITEM 3. |
KEY INFORMATION
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A. |
[Reserved]
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B. |
Capitalization and Indebtedness
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C. |
Reasons for the Offer and Use of Proceeds
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D. |
Risk Factors
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• |
Charter hire rates for dry bulk and tanker vessels are volatile. A decrease in charter rates may adversely affect our business, financial condition and operating results.
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• |
An oversupply of dry bulk and/or tanker vessel capacity may prolong or further depress low charter rates when they occur, which may limit our ability to operate our vessels profitably.
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• |
Global economic and financial conditions may negatively impact the dry bulk and tanker sectors of the shipping industry, including the extension of credit.
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• |
Risks involved in operating ocean-going vessels could affect our business and reputation.
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The operation of tankers has unique operational risks associated with the transportation of oil.
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• |
A decline in the market values of our vessels could limit the amount of funds that we can borrow, cause us to breach certain financial covenants in our credit facilities, and result in impairment charges or losses on sale.
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• |
Political instability, terrorist attacks, international hostilities and global public health threats, including major outbreaks of diseases, could adversely affect our business.
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• |
Compliance with safety and other vessel requirements imposed by classification societies may be costly and could reduce our net cash flows and negatively impact our results of operations.
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• |
We are subject to laws, regulations and standards (including environmental standards such as IMO 2020, standards regulating ballast water discharge, etc.), which could adversely affect our business, results
of operations, cash flows, and financial condition. In particular, climate change and greenhouse gas restrictions may adversely impact our operations and markets.
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• |
Increased inspection procedures and tighter import and export controls could increase costs and disrupt our business.
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• |
We have grown our fleet exponentially and we may have difficulty managing our growth properly which may adversely affect our operations and profitability.
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• |
We may not be able to execute our growth strategy and we may not realize the benefits we expect from past acquisitions or future acquisitions or other strategic transactions.
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• |
We operate secondhand vessels with an age above the industry average which may lead to increased technical problems for our vessels, higher operating expenses, affect our ability to profitably charter our vessels and to comply with
environmental standards and future maritime regulations and result in a more rapid depreciation in our vessels’ market and book values.
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• |
We are dependent upon Castor Ships and Pavimar, which are related parties, and other third-party sub-managers (particularly for our tanker segments), for the management of our fleet and business, and failure
of such counterparties to meet their obligations could cause us to suffer losses or negatively impact our results of operations and cash flows.
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• |
Our credit facilities contain, and we expect that any new or amended credit facility we enter into will contain, restrictive financial covenants that we may not be able to comply with due to economic,
financial or operational reasons and may limit our business and financing activities.
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• |
Our Board may never declare dividends.
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• |
Our share price has been highly volatile and may continue to be volatile in the future, and as a result, investors in our common shares could incur substantial losses.
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• |
Nasdaq may delist our common shares from its exchange which could limit your ability to make transactions in our securities and subject us to additional trading restrictions.
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• |
Recent share issuances and future issuances, or the potential of such issuances, may impact the price of our common shares and could impair our ability to raise capital through subsequent equity offerings.
Shareholders may experience significant dilution as a result of any such issuances.
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• |
We are incorporated in the Marshall Islands, which does not have a well-developed body of corporate and case law.
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• |
Our Chairman, Chief Executive Officer and Chief Financial Officer, who may be deemed to beneficially own, directly or indirectly, 100% of our Series B Preferred Shares, has control over us.
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• |
global and regional economic and political conditions and developments, including armed conflicts and terrorist activities, embargoes and strikes;
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• |
developments in international trade;
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• |
changes in seaborne and other transportation and distribution patterns, typically influenced by the relative advantage of the various sources of production, locations of consumption, pricing differentials and
seasonality;
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• |
pandemics, such as the COVID-19 outbreak;
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• |
environmental and other regulatory developments;
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• |
currency exchange rates; and
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• |
the weather.
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• |
the number of newbuilding orders and deliveries;
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• |
the number of shipyards and ability of shipyards to deliver vessels;
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• |
port and canal congestion;
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• |
scrapping of older vessels;
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• |
the speed of vessels being operated;
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• |
vessel casualties; and
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• |
the number of vessels that are out of service or laid up.
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• |
low charter rates, particularly for vessels employed on short-term time charters, in the spot voyage market or pools;
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• |
decreases in the market value of vessels and limited second-hand market for the sale of vessels;
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• |
limited financing for vessels;
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• |
widespread loan covenant defaults; and
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• |
declaration of bankruptcy by certain vessel operators, vessel managers, vessel owners, shipyards and charterers.
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• |
a marine disaster;
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• |
terrorism;
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• |
environmental accidents;
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• |
cargo and property losses and damage; and
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• |
business interruptions caused by mechanical failure, human error, war, terrorism, piracy, political action in various countries, labor strikes, or adverse weather conditions.
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• |
office assessments and audits of the vessel operator;
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• |
the operator’s environmental, health and safety record;
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• |
compliance with the standards of the International Maritime Organization (the “IMO”), a United Nations agency that issues international trade standards for shipping;
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• |
compliance with heightened industry standards that have been set by several oil companies;
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• |
shipping industry relationships, reputation for customer service, technical and operating expertise;
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• |
compliance with oil majors codes of conduct, policies and guidelines, including transparency, anti-bribery and ethical conduct requirements and relationships with third parties;
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• |
shipping experience and quality of ship operations, including cost-effectiveness;
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• |
quality, experience and technical capability of crews;
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• |
the ability to finance vessels at competitive rates and overall financial stability;
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• |
relationships with shipyards and the ability to obtain suitable berths;
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• |
construction management experience, including the ability to procure on-time delivery of new vessels according to customer specifications;
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• |
willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for force majeure events; and
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• |
competitiveness of the bid in terms of overall price.
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• |
prevailing level of charter rates;
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• |
general economic and market conditions affecting the shipping industry;
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• |
the types, sizes and ages of the vessels, including as compared to other vessels in the market;
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• |
supply of and demand for vessels;
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• |
the availability and cost of other modes of transportation;
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• |
distressed asset sales, including newbuilding contract sales below acquisition costs due to lack of financing;
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• |
cost of newbuildings;
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• |
governmental or other regulations, including those that may limit the useful life of vessels; and
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• |
the need to upgrade vessels as a result of charterer requirements, technological advances in vessel design or equipment or otherwise.
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• |
deterioration of economic conditions and activity and of demand for shipping;
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• |
operational disruptions to us or our customers due to worker health risks and the effects of new regulations, directives or practices implemented in response to the pandemic (such as travel restrictions for individuals, delays in
replacing crews and vessels, and quarantining and physical distancing);
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• |
delays in the loading and discharging of cargo on or from our vessels, vessel inspections and related certifications by class societies, customers or government agencies and maintenance, modifications or repairs to, or dry-docking of,
our existing vessels due to worker health or other business disruptions;
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• |
reduced cash flow as a result of the above and worsened financial condition, including potential liquidity constraints;
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• |
potential non-performance by counterparties relying on force majeure clauses and potential deterioration in the financial condition and prospects of our customers or other business partners;
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• |
credit tightening or declines in global financial markets, including to the prices of our publicly traded securities and the securities of our peers, could make it more difficult for us to access capital; and
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• |
potential disruptions, delays or cancellations in the construction of new vessels, which could reduce our future growth opportunities.
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•
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identify suitable vessels, including newbuilding slots at reputable shipyards and/or shipping companies for acquisitions at attractive prices;
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•
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realize anticipated benefits, such as new customer relationships, cost-savings or cash flow enhancements from past acquisitions;
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•
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obtain required financing for our existing and new operations;
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•
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integrate any acquired vessels, assets or businesses successfully with our existing operations, including obtaining any approvals and qualifications necessary to operate vessels that we acquire;
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•
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hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet;
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•
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improve our operating, financial and accounting systems and controls; and
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•
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cope with competition from other companies, many of which have significantly greater financial resources than we do, and may reduce our acquisition opportunities or cause us to pay higher prices.
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•
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as our vessels age, typically, they become less fuel-efficient and more costly to maintain than more recently constructed vessels due to improvements in engine technology and increased maintenance
requirements;
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•
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cargo insurance rates increase with the age of a vessel, making our vessels more expensive to operate;
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•
|
governmental regulations, environmental and safety or other equipment standards related to the age of vessels may also require expenditures for alterations or the addition of new equipment to our vessels
and may restrict the type of activities in which our vessels may engage.
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• |
incur or guarantee additional indebtedness outside of our ordinary course of business;
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• |
charge, pledge or encumber our vessels;
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• |
change the flag, class, management or ownership of our vessels;
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• |
change the commercial and technical management of our vessels;
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• |
declare or pay any dividends or other distributions at a time when the Company has an event of default or the payment of such distribution would cause an event of default;
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• |
form or acquire any subsidiaries;
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• |
make any investments in any person, asset, firm, corporation, joint venture or other entity;
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• |
merge or consolidate with any other person;
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• |
sell or change the beneficial ownership or control of our vessels if there has been a change of control directly or indirectly in our subsidiaries or us; and
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• |
to enter into time charter contracts above a certain duration or bareboat charters.
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(i) |
maintaining a certain minimum level of cash on pledged deposit accounts with the borrowers;
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(ii) |
maintaining a certain minimum value ratio at the borrowers’ level, which is the ratio of the aggregate market value of the mortgaged vessels plus the value of any additional security and value of the pledged deposit and/or the value of
dry dock reserve accounts to the aggregate principal amounts due under the facilities;
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(iii) |
maintaining a dry dock reserve at the borrowers’ level;
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(iv) |
not having a ratio of net debt to assets adjusted for the market value of the vessels above a certain level;
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(v) |
maintaining a certain level of minimum free cash at Castor Maritime; and
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(vi) |
maintaining a trailing 12 months EBITDA to net interest expense ratio at and above a certain level.
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• |
the market price of our common shares may experience rapid and substantial increases or decreases unrelated to our operating performance or prospects, or macro or industry fundamentals;
|
• |
to the extent volatility in our common shares is caused by a “short squeeze” in which coordinated trading activity causes a spike in the market price of our common shares as traders with a short position make market purchases to avoid
or to mitigate potential losses, investors may purchase at inflated prices unrelated to our financial performance or prospects, and may thereafter suffer substantial losses as prices decline once the level of short-covering purchases has
abated;
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• |
if the market price of our common shares declines, you may be unable to resell your shares at or above the price at which you acquired them. We cannot assure you that the equity issuance of our common shares will not fluctuate,
increase or decline significantly in the future, in which case you could incur substantial losses.
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• |
investor reaction to our business strategy;
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• |
the sentiment of the significant number of retail investors whom we believe to hold our common shares, in part due to direct access by retail investors to broadly available trading platforms, and whose investment thesis may be
influenced by views expressed on financial trading and other social media sites and online forums;
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• |
the amount and status of short interest in our common shares, access to margin debt, trading in options and other derivatives on our common shares and any related hedging and other trading factors;
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• |
our continued compliance with the listing standards of the Nasdaq Capital Market;
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• |
regulatory or legal developments in the United States and other countries, especially changes in laws or regulations applicable to our industry;
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• |
variations in our financial results or those of companies that are perceived to be similar to us;
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• |
our ability or inability to raise additional capital and the terms on which we raise it;
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• |
our dividend strategy;
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• |
our continued compliance with our debt covenants;
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• |
variations in the value of our fleet;
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• |
declines in the market prices of stocks generally;
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• |
trading volume of our common shares;
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• |
sales of our common shares by us or our shareholders;
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• |
speculation in the press or investment community about our Company or industry;
|
• |
general economic, industry and market conditions; and
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• |
other events or factors, including those resulting from such events, or the prospect of such events, including war, terrorism and other international conflicts, public health issues including health epidemics or pandemics, including
the ongoing COVID-19 pandemic, and natural disasters such as fire, hurricanes, earthquakes, tornados or other adverse weather and climate conditions, whether occurring in the United States or elsewhere, could disrupt our operations or
result in political or economic instability.
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• |
our existing shareholders’ proportionate ownership interest in us will decrease;
|
• |
the earnings per share and the per share amount of cash available for dividends on our common shares (as and if declared) could decrease;
|
• |
the relative voting strength of each previously outstanding common share could be diminished;
|
• |
the market price of our common shares could decline; and
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• |
our ability to raise capital through the sale of additional securities at a time and price that we deem appropriate, could be impaired.
|
• |
authorizing our Board to issue “blank check” preferred shares without shareholder approval;
|
• |
providing for a classified Board with staggered, three-year terms;
|
• |
establishing certain advance notice requirements for nominations for election to our Board or for proposing matters that can be acted on by shareholders at shareholder meetings;
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• |
prohibiting cumulative voting in the election of directors;
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• |
limiting the persons who may call special meetings of shareholders; and
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• |
establishing supermajority voting provisions with respect to amendments to certain provisions of our Articles of Incorporation and Bylaws.
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ITEM 4. |
INFORMATION ON THE COMPANY
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A. |
History and Development of the Company
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B. |
Business Overview
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Vessel Name
|
Year
Built
|
Type of
Charter |
Capacity
(dwt) |
Delivered to
Castor |
Gross Charter Rate ($/day)
|
Estimated Earliest Charter Expiration
|
Estimated Latest Charter Expiration
|
||||
Panamax
|
|||||||||||
Magic Nova
|
2010
|
Period Time Charter
|
78,833
|
October 2020
|
$25,300(1)
|
October 2022
|
February 2023
|
||||
Magic Mars
|
2014
|
Period Time Charter
|
76,822
|
September 2021
|
$21,500(2)
|
November 2022
|
February 2023
|
||||
Magic Phoenix
|
2008
|
Period Time Charter
|
76,636
|
October 2021
|
102% of BPI4TC(3) (4)
|
September 2022
|
December 2022
|
||||
Magic Horizon
|
2010
|
Trip Time Charter
|
76,619
|
October 2020
|
$20,100(5)
|
March 2022
|
March 2022
|
||||
Magic Moon
|
2005
|
Trip Time Charter
|
76,602
|
October 2019
|
$25,000
|
April 2022
|
April 2022
|
||||
Magic P
|
2004
|
Period Time Charter
|
76,453
|
February 2017
|
$27,500
|
April 2022
|
July 2022
|
||||
Magic Sun
|
2001
|
Trip Time Charter
|
75,311
|
September 2019
|
$17,500 plus $750,000 Ballast Bonus
|
April 2022
|
April 2022
|
||||
Magic Vela
|
2011
|
Trip Time Charter
|
75,003
|
May 2021
|
$16,000 plus $550,000 Ballast Bonus
|
April 2022
|
April 2022
|
||||
Magic Eclipse
|
2011
|
Period Time Charter
|
74,940
|
June 2021
|
$28,500
|
April 2022
|
July 2022
|
||||
Magic Pluto
|
2013
|
Period Time Charter
|
74,940
|
August 2021
|
$24,000(6)
|
November 2022
|
February 2023
|
||||
Magic Callisto
|
2012
|
Period Time Charter
|
74,930
|
January 2022
|
$27,000(7)
|
October 2022
|
January 2023
|
||||
Magic Rainbow
|
2007
|
Trip Time Charter
|
73,593
|
August 2020
|
$16,000
|
April 2022
|
April 2022
|
||||
Kamsarmax
|
|||||||||||
Magic Venus
|
2010
|
Trip Time Charter
|
83,416
|
March 2021
|
$16,300 plus $630,000 Ballast Bonus (8)
|
April 2022
|
April 2022
|
||||
Magic Thunder
|
2011
|
Period Time Charter
|
83,375
|
April 2021
|
100% of BPI5TC
|
October 2022
|
January 2023
|
||||
Magic Argo
|
2009
|
Trip Time Charter
|
82,338
|
March 2021
|
$16,600(9)
|
April 2022
|
April 2022
|
||||
Magic Perseus
|
2013
|
Period Time Charter
|
82,158
|
August 2021
|
100% of BPI5TC
|
October 2022
|
January 2023
|
||||
Magic Starlight
|
2015
|
Period Time Charter
|
81,048
|
May 2021
|
$32,000(10)
|
September 2022
|
March 2023
|
||||
Magic Twilight
|
2010
|
Period Time Charter
|
80,283
|
April 2021
|
$25,000(11)
|
January 2023
|
April 2023
|
||||
Magic Nebula
|
2010
|
Period Time Charter
|
80,281
|
May 2021
|
$23,500
|
September 2022
|
November 2022
|
||||
Capesize
|
|||||||||||
Magic Orion
|
2006
|
Period Time Charter
|
180,200
|
March 2021
|
101% of BCI5TC (12)
|
October 2022
|
January 2023
|
(1) |
The vessels’ daily gross charter rate is equal to 92% of BPI5TC. In accordance with the prevailing charter party, on 17/02/2022 owners converted the index-linked rate to fixed from 01/03/2022 until 30/09/2022, at a rate of $25,300 per
day. Upon completion of said period, the rate will be converted back to index linked. The benchmark vessel used in the calculation of the average of the Baltic Panamax Index 5TC routes is a non-scrubber fitted 82,500mt dwt vessel
(Kamsarmax) with specific age, speed - consumption, and design characteristics.
|
(2) |
The vessels’ daily gross charter rate is equal to 91% of BPI5TC. In accordance with the prevailing charter party, on 20/01/2022 owners converted the index-linked rate to fixed from 01/02/2022 until 30/09/2022, at a rate of $21,500 per
day. Upon completion of said period, the rate will be converted back to index linked.
|
(3) |
The benchmark vessel used in the calculation of the average of the Baltic Panamax Index 4TC routes is a non-scrubber fitted 74,000mt dwt vessel (Panamax) with specific age, speed - consumption, and design characteristics.
|
(4) |
In accordance with the prevailing charter party, on 03/03/2022 owners converted the index-linked rate to fixed from 01/04/2022 until 30/09/2022, at a rate of $28,100 per day. Upon completion of said period, the rate will be converted
back to index linked.
|
(5) |
Upon completion of current time charter trip, estimated within April, the vessel has been fixed on a time charter period at a gross daily charter rate equal to 103% of the average of Baltic Panamax Index 4TC routes, with a minimum
duration of 12 months and a maximum duration of 15 months, at the charterer’s option.
|
(6) |
The vessels’ daily gross charter rate is equal to 91% of BPI5TC. In accordance with the prevailing charter party, on 08/02/2022 owners converted the index-linked rate to fixed from 01/03/2022 until 30/09/2022, at a rate of $24,000 per
day. Upon completion of said period, the rate will be converted back to index linked.
|
(7) |
The vessels’ daily gross charter rate is equal to 101% of BPI4TC. In accordance with the prevailing charter party, on 22/02/2022 owners converted the index-linked rate to fixed from 01/03/2022 until 30/09/2022, at a rate of $27,000 per
day. Upon completion of said period, the rate will be converted back to index linked.
|
(8) |
Upon completion of current time charter trip, estimated within April, the vessel has been fixed on a time charter period at a gross daily charter rate equal to 100% of the average of Baltic Panamax Index 5TC routes, with a minimum
duration of about 13 months and a maximum duration of about 15 months, at the charterer’s option.
|
(9) |
Upon completion of current time charter trip, estimated within April, the vessel has been fixed on a time charter period at a gross daily charter rate equal to 103% of the average of Baltic Panamax Index 5TC routes, with a minimum
duration of 12 months and a maximum duration of 15 months, at the charterer’s option.
|
(10) |
The vessels’ daily gross charter rate is equal to 114% of BPI4TC. In accordance with the prevailing charter party, on 19/10/2021 owners converted the index-linked rate to fixed from 01/01/2022 until 30/09/2022, at a rate of $32,000 per
day. Upon completion of said period, the rate will be converted back to index linked.
|
(11) |
In accordance with the prevailing charter party, the vessel’s daily gross charter rate is $25,000 per day for the first 30 days and thereafter index-linked at a rate equal to 93% of BPI5TC.
|
(12) |
The benchmark vessel used in the calculation of the average of the Baltic Capesize Index 5TC routes is a non-scrubber fitted 180,000mt dwt vessel (Capesize) with specific age, speed - consumption, and design characteristics.
|
Vessel Name
|
Year
Built
|
Type of
Charter |
Capacity
(dwt) |
Delivered to
Castor |
Gross Charter Rate ($/day)
|
Estimated Earliest Charter Expiration
|
Estimated Latest Charter Expiration
|
||||||||||||
Aframax/LR2
|
|||||||||||||||||||
Wonder Polaris
|
2005
|
Voyage
|
115,351
|
March 2021
|
$
|
6,500
|
(1)
|
31 March 2022 (2)
|
N/A
|
||||||||||
Wonder Sirius
|
2005
|
Unfixed
|
115,341
|
March 2021
|
N/A
|
N/A
|
N/A
|
||||||||||||
Wonder Bellatrix
|
2006
|
Voyage
|
115,341
|
December 2021
|
$
|
21,024
|
(1)
|
3 April 2022 (2)
|
N/A
|
||||||||||
Wonder Musica
|
2004
|
Unfixed
|
106,290
|
June 2021
|
|
N/A
|
|
N/A
|
N/A
|
||||||||||
Wonder Avior
|
2004
|
Voyage
|
106,162
|
May 2021
|
$
|
7,440
|
(1)
|
16 April 2022 (2)
|
N/A
|
||||||||||
Wonder Arcturus
|
2002
|
Unfixed
|
106,149
|
May 2021
|
N/A
|
N/A
|
N/A
|
||||||||||||
Aframax
|
|||||||||||||||||||
Wonder Vega
|
2005
|
Tanker Pool (3)
|
106,062
|
May 2021
|
N/A
|
N/A
|
N/A
|
(1) |
For vessels that are employed on the voyage/spot market, the gross daily charter rate is considered as the Daily TCE Rate on the basis of the
expected completion date.
|
(2) |
Estimated completion date of the voyage.
|
(3) |
The vessel is currently participating in an unaffiliated tanker pool specializing in the employment of Aframax tanker vessels.
|
Vessel Name
|
Year
Built
|
Type of
Charter |
Capacity
(dwt) |
Delivered to
Castor |
Gross Charter Rate ($/day)
|
Estimated Earliest Charter Expiration
|
Estimated Latest Charter Expiration
|
||||||||||||
Wonder Mimosa
|
2006
|
Tanker Pool (1)
|
36,718
|
May 2021
|
N/A
|
N/A
|
N/A
|
||||||||||||
Wonder Formosa
|
2006
|
Tanker Pool (1)
|
36,660
|
June 2021
|
N/A
|
N/A
|
N/A
|
||||||||||||
(1) |
The vessel is currently participating in an unaffiliated tanker pool specializing in the employment of Handysize tanker vessels.
|
Aframax/LR2 Tankers
|
|||||||||||||||
2021 Acquisitions
|
|||||||||||||||
Wonder Polaris
|
Aframax LR2
|
115,351
|
2005
|
S. Korea
|
$
|
13.60
|
03/11/21
|
||||||||
Wonder Sirius
|
Aframax LR2
|
115,341
|
2005
|
S. Korea
|
$
|
13.60
|
03/22/21
|
||||||||
Wonder Vega
|
Aframax
|
106,062
|
2005
|
S. Korea
|
$
|
14.80
|
05/21/21
|
||||||||
Wonder Avior
|
Aframax LR2
|
106,162
|
2004
|
S. Korea
|
$
|
12.00
|
05/27/21
|
||||||||
Wonder Arcturus
|
Aframax LR2
|
106,149
|
2002
|
S. Korea
|
$
|
10.00
|
05/31/21
|
||||||||
Wonder Musica
|
Aframax LR2
|
106,290
|
2004
|
S. Korea
|
$
|
12.00
|
06/15/21
|
||||||||
Wonder Bellatrix
|
Aframax LR2
|
115,341
|
2006
|
S. Korea
|
$
|
18.15
|
12/23/21
|
Handysize Tankers
|
|||||||||||||||
2021 Acquisitions
|
|||||||||||||||
Wonder Mimosa
|
Handysize
|
36,718
|
2006
|
S. Korea
|
$
|
7.25
|
05/31/21
|
||||||||
Wonder Formosa
|
Handysize
|
36,660
|
2006
|
S. Korea
|
$
|
8.00
|
06/22/21
|
C. |
Organizational Structure
|
D. |
Property, Plants and Equipment
|
ITEM 4A. |
UNRESOLVED STAFF COMMENTS
|
ITEM 5. |
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
A. |
Operating Results
|
- |
The levels of demand and supply of seaborne cargoes and vessel tonnage in the dry bulk and tanker shipping industries;
|
- |
The cyclical nature of the shipping industry in general and its impact on charter rates and vessel values;
|
- |
The successful implementation of the Company’s growth business strategy, including our ability to obtain equity and debt financing at acceptable and attractive terms to fund future capital
expenditures and/or to implement our business strategy;
|
- |
The global economic growth outlook and trends;
|
- |
Economic, regulatory, political and governmental conditions that affect shipping and the dry-bulk and tanker industries;
|
- |
The employment and operation of our fleet including the utilization rates of our vessels;
|
- |
Our ability to successfully employ our vessels at economically attractive rates and our strategic decisions regarding the employment mix of our fleet in the time, voyage, and pool charter
markets, as our charters expire or are otherwise terminated;
|
- |
Management of the financial, general and administrative elements involved in the conduct of our business and ownership of our fleet, including the effective and efficient technical management of our fleet
by our head and sub-managers, and their suppliers;
|
- |
The number of charterers who use our services and the performance of their charterers’ obligations under their charter agreements, including ’their ability to make timely charter payments to us;
|
- |
Our ability to maintain solid working relationships with our existing charterers and our ability to increase the number of our charterers through the development of new working relationships;
|
- |
The vetting approvals by oil majors of our commercial and technical managers for the management of our tanker vessels;
|
- |
Dry-docking and special survey costs and duration, both expected and unexpected;
|
- |
The level of any distribution on all classes of our shares;
|
- |
Our borrowing levels and the finance costs related to our outstanding debt as well as our compliance with our debt covenants; and
|
- |
Management of our financial resources, including banking relationships and of the relationships with our various stakeholders;
|
- |
Major outbreaks of diseases (such as COVID-19) and governmental responses thereto.
|
Year Ended December 31,
|
||||||||
(In U.S. dollars, except for Available Days)
|
2020
|
2021
|
||||||
Vessel revenues, net
|
$
|
12,487,692
|
$
|
132,049,710
|
||||
Voyage expenses -including commissions from related parties
|
(584,705
|
)
|
(12,950,783
|
)
|
||||
TCE revenues
|
$
|
11,902,987
|
$
|
119,098,927
|
||||
Available Days
|
1,267
|
6,657
|
||||||
Daily TCE Rate
|
$
|
9,395
|
$
|
17,891
|
Year Ended December 31,
|
||||||||
(In U.S. dollars, except for Available Days)
|
2020
|
2021
|
||||||
Vessel revenues, net
|
$
|
12,487,692
|
$
|
102,785,442
|
||||
Voyage expenses -including commissions from related parties
|
(584,705
|
)
|
(1,891,265
|
)
|
||||
TCE revenues
|
$
|
11,902,987
|
$
|
100,894,177
|
||||
Available Days
|
1,267
|
4,843
|
||||||
Daily TCE Rate
|
$
|
9,395
|
$
|
20,833
|
(In U.S. dollars, except for Available Days)
|
2021
|
|||
Vessel revenues, net
|
$
|
26,559,413
|
||
Voyage expenses -including commissions from related parties
|
(11,003,925
|
)
|
||
TCE revenues
|
$
|
15,555,488
|
||
Available Days
|
1,446
|
|||
Daily TCE Rate
|
$
|
10,758
|
(In U.S. dollars, except for Available Days)
|
2021
|
|||
Vessel revenues, net
|
$
|
2,704,855
|
||
Voyage expenses -including commissions from related parties
|
(55,593
|
)
|
||
TCE revenues
|
$
|
2,649,262
|
||
Available Days
|
368
|
|||
Daily TCE Rate
|
$
|
7,199
|
Year Ended December 31,
|
||||||||
2020
|
2021
|
|||||||
Daily vessel operating expenses
|
$
|
5,301
|
$
|
5,759
|
||||
Ownership Days
|
1,405
|
6,807
|
||||||
Available Days
|
1,267
|
6,657
|
||||||
Operating Days
|
1,259
|
6,562
|
||||||
Fleet Utilization
|
99
|
%
|
99
|
%
|
||||
Daily TCE Rate
|
$
|
9,395
|
$
|
17,891
|
||||
EBITDA
|
$
|
2,327,671
|
$
|
69,910,529
|
Year Ended December 31,
|
||||||||
2020
|
2021
|
|||||||
Daily vessel operating expenses
|
$
|
5,301
|
$
|
5,418
|
||||
Ownership Days
|
1,405
|
4,954
|
||||||
Available Days
|
1,267
|
4,843
|
||||||
Operating Days
|
1,259
|
4,766
|
||||||
Fleet Utilization
|
99
|
%
|
98
|
%
|
||||
Daily TCE Rate
|
$
|
9,395
|
$
|
20,833
|
Year Ended December 31,
|
||||
2021
|
||||
Daily vessel operating expenses
|
$
|
6,761
|
||
Ownership Days
|
1,446
|
|||
Available Days
|
1,446
|
|||
Operating Days
|
1,428
|
|||
Fleet Utilization
|
99
|
%
|
||
Daily TCE Rate
|
$
|
10,758
|
Year Ended December 31,
|
||||
2021
|
||||
Daily vessel operating expenses
|
$
|
6,352
|
||
Ownership Days
|
407
|
|||
Available Days
|
368
|
|||
Operating Days
|
368
|
|||
Fleet Utilization
|
100
|
%
|
||
Daily TCE Rate
|
$
|
7,199
|
Year Ended December 31,
|
||||||||
(In U.S. dollars)
|
2020
|
2021
|
||||||
Net Income/(Loss)
|
$
|
(1,753,533
|
)
|
$
|
52,270,487
|
|||
Depreciation and amortization
|
1,904,963
|
14,362,828
|
||||||
Interest and finance costs, net (including related party interest costs) (1)
|
2,154,601
|
2,779,875
|
||||||
US source income taxes
|
21,640
|
497,339
|
||||||
EBITDA
|
$
|
2,327,671
|
$
|
69,910,529
|
(1)
|
Includes interest and finance costs and interest income, if any.
|
(In U.S. Dollars, except for share data)
|
Year ended
December 31, 2020
|
Year ended
December 31, 2021
|
Change-
amount
|
Change %
|
||||||||||||
Vessel revenues (net of charterers’ commissions)
|
12,487,692
|
132,049,710
|
119,562,018
|
957.4
|
%
|
|||||||||||
Expenses:
|
||||||||||||||||
Voyage expenses (including commissions to related party)
|
(584,705
|
)
|
(12,950,783
|
)
|
12,366,078
|
2,114.9
|
%
|
|||||||||
Vessel operating expenses
|
(7,447,439
|
)
|
(39,203,471
|
)
|
31,756,032
|
426.4
|
%
|
|||||||||
Management fees to related parties
|
(930,500
|
)
|
(6,744,750
|
)
|
5,814,250
|
624.9
|
%
|
|||||||||
Depreciation and amortization
|
(1,904,963
|
)
|
(14,362,828
|
)
|
12,457,865
|
654.0
|
%
|
|||||||||
Provision for doubtful accounts
|
(37,103
|
)
|
(2,483
|
)
|
(34,620
|
)
|
(93.3
|
%)
|
||||||||
General and administrative expenses (including related party)
|
(1,130,953
|
)
|
(3,266,310
|
)
|
2,135,357
|
188.8
|
%
|
|||||||||
Operating income
|
452,029
|
55,519,085
|
55,067,056
|
12,182.2
|
%
|
|||||||||||
Interest and finance costs, net (including interest costs from related party)
|
(2,154,601
|
)
|
(2,779,875
|
)
|
625,274
|
29.0
|
%
|
|||||||||
Total other expenses, net
|
(2,183,922
|
)
|
(2,751,259
|
)
|
567,337
|
26.0
|
%
|
|||||||||
US source income taxes
|
(21,640
|
)
|
(497,339
|
)
|
475,699
|
2,198.2
|
%
|
|||||||||
Net (loss)/income and comprehensive (loss)/income
|
(1,753,533
|
)
|
52,270,487
|
54,024,020
|
3,080.9
|
%
|
||||||||||
(Loss)/ Earnings per common share, basic
|
(0.26
|
)
|
0.48
|
|||||||||||||
(Loss)/ Earnings per common share, diluted
|
(0.26
|
)
|
0.47
|
|||||||||||||
Weighted average number of common shares, basic
|
6,773,519
|
83,923,435
|
||||||||||||||
Weighted average number of common shares, diluted
|
6,773,519
|
85,332,728
|
(In U.S. Dollars, except for share data)
|
Year ended
December 31, 2020
|
Year ended
December 31, 2021
|
Change-amount
|
Change %
|
||||||||||||
Vessel revenues (net of charterers’ commissions)
|
12,487,692
|
102,785,442
|
90,297,750
|
723.1
|
%
|
|||||||||||
Expenses:
|
||||||||||||||||
Voyage expenses (including commissions to related party)
|
(584,705
|
)
|
(1,891,265
|
)
|
1,306,560
|
223.5
|
%
|
|||||||||
Vessel operating expenses
|
(7,447,439
|
)
|
(26,841,600
|
)
|
19,394,161
|
260.4
|
%
|
|||||||||
Management fees to related parties
|
(930,500
|
)
|
(4,890,900
|
)
|
3,960,400
|
425.6
|
%
|
|||||||||
Depreciation and amortization
|
(1,904,963
|
)
|
(10,528,711
|
)
|
8,623,748
|
452.7
|
%
|
|||||||||
Provision for doubtful accounts
|
(37,103
|
)
|
(2,483
|
)
|
(34,620
|
)
|
(93.3
|
%
)
|
||||||||
Operating income (1)
|
1,582,982
|
58,630,483
|
57,047,501
|
3,603.8
|
%
|
(1)
|
Does not include corporate general and administrative expenses. See the discussion under “Consolidated Results of Operations” above.
|
(In U.S. Dollars, except for share data)
|
Year ended
December 31, 2020
|
Year ended
December 31, 2021
|
Change -amount
|
Change %
|
||||||||||||
Vessel revenues (net of charterers’ commissions)
|
—
|
26,559,413
|
26,559,413
|
100.0
|
%
|
|||||||||||
Expenses:
|
||||||||||||||||
Voyage expenses (including commissions to related party)
|
—
|
(11,003,925
|
)
|
(11,003,925
|
)
|
100.0
|
%
|
|||||||||
Vessel operating expenses
|
—
|
(9,776,724
|
)
|
(9,776,724
|
)
|
100.0
|
%
|
|||||||||
Management fees to related parties
|
—
|
(1,433,950
|
)
|
(1,433,950
|
)
|
100.0
|
%
|
|||||||||
Depreciation and amortization
|
—
|
(3,087,764
|
)
|
(3,087,764
|
)
|
100.0
|
%
|
|||||||||
Operating income
|
—
|
1,257,050
|
1,257,050
|
100.0
|
%
|
(1)
|
Does not include corporate general and administrative expenses. See the discussion under “Consolidated Results of Operations” above.
|
(In U.S. Dollars, except for share data)
|
Year ended
December 31, 2020
|
Year ended
December 31, 2021
|
Change -amount
|
Change %
|
||||||||||||
Vessel revenues (net of charterers’ commissions)
|
—
|
2,704,855
|
2,704,855
|
100.0
|
%
|
|||||||||||
Expenses:
|
||||||||||||||||
Voyage expenses (including commissions to related party)
|
—
|
(55,593
|
)
|
(55,593
|
)
|
100.0
|
%
|
|||||||||
Vessel operating expenses
|
—
|
(2,585,147
|
)
|
(2,585,147
|
)
|
100.0
|
%
|
|||||||||
Management fees to related parties
|
—
|
(419,900
|
)
|
(419,900
|
)
|
100.0
|
%
|
|||||||||
Depreciation and amortization
|
—
|
(746,353
|
)
|
(746,353
|
)
|
100.0
|
%
|
|||||||||
Operating loss
|
—
|
(1,102,138
|
)
|
(1,102,138
|
)
|
100.0
|
%
|
(1)
|
Does not include corporate general and administrative expenses. See the discussion under “Consolidated Results of Operations” above.
|
• |
an exemption from the auditor attestation requirement of management’s assessment of the effectiveness of the emerging growth company’s internal controls over financial reporting pursuant to Section 404(b) of Sarbanes-Oxley; and
|
• |
an exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would
be required to provide additional information about the audit and financial statements.
|
B. |
Liquidity and Capital Resources
|
(in U.S Dollars)
|
For the year ended
|
|||||||
December 31, 2020
|
December 31, 2021
|
|||||||
Net cash (used in)/provided by operating activities
|
(2,343,809
|
)
|
60,775,327
|
|||||
Net cash used in investing activities
|
(35,472,173
|
)
|
(348,640,707
|
)
|
||||
Net cash provided by financing activities
|
42,183,946
|
321,824,945
|
C. |
Research and Development, Patents and Licenses, Etc.
|
D. |
Trend Information
|
E. |
Critical Accounting Estimates
|
• |
the charter revenues from existing time charters for the fixed fleet days;
|
• |
estimated vessel operating expenses and voyage expenses;
|
• |
estimated dry-docking expenditures;
|
• |
an estimated gross daily charter rate for the unfixed days (based on the ten-year average of the historical six-months and one-year time charter rates available for each type of vessel) over the remaining economic life of each vessel,
excluding days of scheduled off-hires and net of commissions;
|
• |
residual value of vessels;
|
• |
commercial and technical management fees;
|
• |
an estimated utilization rate; and
|
• |
the remaining estimated life of our vessels.
|
• |
in accordance with the prevailing industry standard, depreciation is calculated using an estimated useful life of 25 years for our vessels, commencing at the date the vessel was originally delivered from the shipyard;
|
• |
estimated useful life of vessels takes into account commercial considerations and regulatory restrictions;
|
• |
estimated charter rates are based on rates under existing vessel contracts and thereafter at market rates at which we expect we can re-charter our vessels based on market trends. We believe that the ten-year average historical time
charter rate is appropriate (or less than ten years if appropriate data is not available) for the following reasons:
|
• |
estimates of vessel utilization, including estimated off-hire time are based on the historical experience of our fleet;
|
• |
estimates of operating expenses and dry-docking expenditures are based on historical operating and dry-docking costs based on the historical experience of our fleet and our expectations of future operating requirements;
|
• |
vessel residual values are a product of a vessel’s lightweight tonnage and an estimated scrap rate; and
|
• |
the remaining estimated lives of our vessels used in our estimates of future cash flows are consistent with those used in our depreciation calculations.
|
ITEM 6. |
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
A. |
Directors and Senior Management
|
Name
|
Age
|
Position
|
|||
Petros Panagiotidis
|
32
|
Chairman, Chief Executive Officer, Chief Financial Officer, President, Treasurer and Class C Director
|
|||
Dionysios Makris
|
41
|
Secretary and Class B Director
|
|||
Georgios Daskalakis
|
32
|
Class A Director
|
B. |
Compensation
|
C. |
Board Practices
|
D. |
Employees
|
E. |
Share Ownership
|
ITEM 7. |
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
A. |
Major Shareholders
|
Name of Beneficial Owner
|
No. of Common Shares
|
Percentage
|
||||||
All executive officers and directors as a group (1) (2)
|
-
|
-
|
%
|
B. |
Related Party Transactions
|
C. |
Interests of Experts and Counsel
|
ITEM 8. |
FINANCIAL INFORMATION
|
A. |
Consolidated Statements and other Financial Information
|
B. |
Significant Changes
|
ITEM 9. |
THE OFFER AND LISTING
|
A. |
Offer and Listing Details
|
B. |
Plan of Distribution
|
C. |
Markets
|
D. |
Selling Shareholders
|
E. |
Dilution
|
F. |
Expenses of the Issue
|
ITEM 10. |
ADDITIONAL INFORMATION
|
A. |
Share Capital
|
B. |
Memorandum and Articles of Association
|
• |
the designation of the series;
|
• |
the number of shares of the series;
|
• |
the preferences and relative, participating, option or other special rights, if any, and any qualifications, limitations or restrictions of such series; and
|
• |
the voting rights, if any, of the holders of the series.
|
• |
Conversion. The Series B Preferred Shares are not convertible into common shares.
|
• |
Voting. Each Series B Preferred Share has the voting power of 100,000 common shares and count for 100,000 votes for purposes of determining quorum at a meeting of
shareholders. The Series B Preferred Share vote together with common shares as a class, except that the Series B Preferred Shares vote separately as a class on amendments to the Articles of Incorporation that would materially alter or
change the powers, preference or special rights of the Series B Preferred Shares.
|
• |
Distributions. The Series B Preferred Shares have no dividend or distribution rights.
|
• |
Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Company, the Series B Preferred Shares shall have the same liquidation rights as
the common shares.
|
C. |
Material Contracts
|
D. |
Exchange Controls
|
E. |
Taxation
|
• |
We have, or are considered to have, a fixed place of business in the United States involved in the earning of shipping income; and
|
• |
substantially all our USSGTI is attributable to regularly scheduled transportation, such as the operation of a vessel that follows a published schedule with repeated sailings at regular intervals between the same points for voyages
that begin or end in the United States.
|
F. |
Dividends and Paying Agents
|
G. |
Statement by Experts
|
H. |
Documents on Display
|
I. |
Subsidiary Information
|
ITEM 11. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 12. |
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
ITEM 13. |
DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
|
ITEM 14. |
MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
|
ITEM 15. |
CONTROLS AND PROCEDURES
|
A. |
Disclosure Controls and Procedures
|
B. |
Management’s Annual Report on Internal Control Over Financial Reporting
|
• |
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
• |
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made
only in accordance with authorizations of Company’s management and directors; and
|
• |
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
C. |
Attestation Report of the Registered Public Accounting Firm
|
D. |
Changes in Internal Control Over Financial Reporting
|
ITEM 16. |
RESERVED
|
ITEM 16A. |
AUDIT COMMITTEE FINANCIAL EXPERT
|
ITEM 16B. |
CODE OF ETHICS
|
ITEM 16C. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
For the year ended
|
||||||||
In U.S. dollars
|
December 31, 2020
|
December 31, 2021
|
||||||
Audit Fees
|
188,750
|
367,000
|
ITEM 16D. |
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
|
ITEM 16E. |
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PERSONS.
|
ITEM 16F. |
CHANGE IN REGISTRANT`S CERTIFYING ACCOUNTANT.
|
ITEM 16G. |
CORPORATE GOVERNANCE
|
• |
Independence of Directors. The Nasdaq requires that a U.S. listed company maintain a majority of independent directors. While our Board is
currently comprised of three directors a majority of whom are independent, we cannot assure you that in the future we will have a majority of independent directors.
|
• |
Executive Sessions. The Nasdaq requires that non-management directors meet regularly in executive sessions without management. The Nasdaq
also requires that all independent directors meet in an executive session at least once a year. As permitted under Marshall Islands law and our bylaws, our non-management directors do not regularly hold executive sessions without
management.
|
• |
Nominating/Corporate Governance Committee. The Nasdaq requires that a listed U.S. company have a nominating/corporate governance committee
of independent directors and a committee charter specifying the purpose, duties and evaluation procedures of the committee. As permitted under Marshall Islands law and our bylaws, we do not currently have a nominating or corporate
governance committee.
|
• |
Compensation Committee. The Nasdaq requires U.S. listed companies to have a compensation committee composed entirely of independent
directors and a committee charter addressing the purpose, responsibility, rights and performance evaluation of the committee. As permitted under Marshall Islands law, we do not currently have a compensation committee. To the extent we
establish such committee in the future, it may not consist of independent directors, entirely or at all.
|
• |
Audit Committee. The Nasdaq requires, among other things, that a listed U.S. company have an audit committee with a minimum of three members, all of whom are independent. As permitted by Nasdaq
Rule 5615(a)(3), we follow home country practice regarding audit committee composition and therefore our audit committee consists of two independent members of our Board, Mr. Georgios Daskalakis and Mr. Dionysios Makris. Although the
members of our audit committee are independent, we are not required to ensure their independence under Nasdaq Rule 5605(c)(2)(A) subject to compliance with Rules 10A-3(b)(1) and 10A-3(c) under the Securities Exchange Act of 1934.
|
• |
Shareholder Approval Requirements. The Nasdaq requires that a listed U.S. company obtain prior shareholder approval for certain issuances
of authorized stock or the approval of, and material revisions to, equity compensation plans. As permitted under Marshall Islands law and our bylaws, we do not seek shareholder approval prior to issuances of authorized stock or the
approval of and material revisions to equity compensation plans.
|
• |
Corporate Governance Guidelines. The Nasdaq requires U.S. companies to adopt and disclose corporate governance guidelines. The guidelines
must address, among other things: director qualification standards, director responsibilities, director access to management and independent advisers, director compensation, director orientation and continuing education, management
succession and an annual performance evaluation of the Board. We are not required to adopt such guidelines under Marshall Islands law and we have not adopted such guidelines.
|
ITEM 16H. |
MINE SAFETY DISCLOSURE
|
ITEM 16I. |
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
|
ITEM 17. |
FINANCIAL STATEMENTS
|
ITEM 18. |
FINANCIAL STATEMENTS
|
ITEM 19. |
EXHIBITS
|
Articles of Incorporation of the Company incorporated by reference to Exhibit 3.1 to the Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Articles of Amendment to the Articles of Incorporation of the Company, as amended, filed with the Registry of the Marshall Islands on May 27, 2021 incorporated by reference to Exhibit 99.1 to Amendment No.
2 to Form 8-A filed with the SEC on May 28, 2021.
|
|
Bylaws of the Company incorporated by reference to Exhibit 3.2 to the Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Form of Common Share Certificate incorporated by reference to Exhibit 99.2 of Amendment No. 2 to Form 8-A filed with the SEC on May 28, 2021.
|
|
Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.
|
|
Form of Class A warrant incorporated by reference to Exhibit 4.8 of Amendment No. 2 to the Company’s registration statement on Form F-1 filed with the SEC on June 23, 2020.
|
|
Form of Pre-Funded warrant incorporated by reference to Exhibit 4.9 of Amendment No. 2 to the Company’s registration statement on Form F-1 filed with the SEC on June 23, 2020.
|
|
Stockholder Rights Agreement dated as of November 20, 2017 by and between the Company and American Stock Transfer & Trust Company, LLC, as rights agent incorporated by reference to Exhibit 10.2 to the
Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Statement of Designation of the Rights, Preferences and Privileges of the 9.75% Series A Cumulative Redeemable Perpetual Preferred Shares of the Company, filed with the Registrar of Corporations of the
Republic of the Marshall Islands on September 22, 2017, incorporated by reference to Exhibit 3.3 to the Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Amended and Restated Statement of Designation of the Rights, Preferences and Privileges of the 9.75% Series A Cumulative Redeemable Perpetual Preferred Shares of the Company, filed with the Registrar of
Corporations of the Republic of the Marshall Islands on October 10, 2019, incorporated by reference to Exhibit 99.2 of the Company’s report on Form 6-K furnished with the SEC on October 11, 2019.
|
|
Statement of Designation of the Rights, Preferences and Privileges of the Rights, Preferences and Privileges of the Series B Preferred Shares of the Company, filed with the Registrar of Corporations of the
Republic of the Marshall Islands on September 22, 2017, incorporated by reference to Exhibit 3.4 to the Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Statement of Designation of the Rights, Preferences and Privileges of the Rights, Preferences and Privileges of the Series C Participating Preferred Shares of the Company, filed with the Registrar of
Corporations of the Republic of the Marshall Islands on November 29, 2017, incorporated by reference to Exhibit 3.5 to the Company’s registration statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Amended and Restated Statement of Designations of Rights, Preferences and Privileges of Series C Participating Preferred Stock of Castor Maritime
Inc., filed with the Registrar of Corporations of the Republic of the Marshall Islands on March 30, 2022.
|
|
Securities Purchase Agreement by and between the Company and YAII PN, Ltd. dated January 27, 2020 incorporated by reference to Exhibit 10.1 of the Company’s report on Form 6-K furnished with the Securities
and Exchange Commission on January 31, 2020.
|
Registration Rights Agreement by and between the Company and YAII PN, Ltd. dated January 27, 2020 incorporated by reference to Exhibit 10.2 of the Company’s report on Form 6-K furnished with the SEC on
January 31, 2020.
|
|
Form of Convertible Debenture incorporated by reference to Exhibit 10.3 of the Company’s report on Form 6-K furnished with the SEC on January 31, 2020.
|
|
Exchange Agreement dated September 22, 2017, between the Company, Spetses Shipping Co., and the shareholders of Spetses Shipping Co., incorporated by reference to Exhibit 10.1 of the Company’s registration
statement on Form F-4 filed with the SEC on April 11, 2018.
|
|
Waiver and Consent Agreement entered into by the Company and all holders of the issued and outstanding 9.75% Series A Cumulative Redeemable Perpetual Preferred Shares, dated October 10, 2019 incorporated by
reference to Exhibit 99.3 of the Company’s report on Form 6-K furnished with the SEC on October 11, 2019.
|
|
$5.0 Million Term Loan Facility, dated August 30, 2019, between Thalassa Investment Co. S.A., as lender, and the Company, as borrower, incorporated by reference to Exhibit 4.7 of the Company’s transition
report on Form 20-F filed with the SEC on December 16, 2019.
|
|
First Supplemental Agreement to the $5.0 Million Term Loan Facility, dated August 30, 2019, between Thalassa Investment Co. S.A., as lender, and the Company, as borrower, incorporated by reference to
Exhibit 4.16 of the Company’s annual report on Form 20-F filed with the SEC on March 3, 2021.
|
|
$11.0 Million Secured Term Loan Facility, dated November 22, 2019, by and among Alpha Bank S,A., as lender, and Pikachu Shipping Co. and Spetses Shipping Co., as borrowers, incorporated by reference to
Exhibit 4.9 of the Company’s transition report on Form 20-F filed with the SEC on December 16, 2019.
|
|
$4.5 Million Secured Loan Agreement, dated January 23, 2020, by and among Chailease International Financial Services Co., Ltd., as lender, Bistro Maritime Co., as borrower, and the Company and Pavimar S.A.,
as guarantors, incorporated by reference to Exhibit 10.1 of the Company’s report on Form 6-K furnished with the SEC on February 4, 2020.
|
|
$15.29 Million Term Loan Facility, dated January 22, 2021, by and among Hamburg Commercial Bank AG and the banks and financial institutions listed in Schedule 1 thereto, as lenders, and Pocahontas Shipping
Co. and Jumaru Shipping Co., as borrowers, incorporated by reference to Exhibit 4.15 of the Company’s annual report on Form 20-F filed with the SEC on March 3, 2021.
|
|
$18.0 Million Term Loan Facility, dated April 27, 2021, between Alpha Bank S.A., as lender, and Gamora Shipping Co. and Rocket Shipping Co., as borrowers.
|
|
$40.75 Million Term Loan Facility, dated July 23, 2021, by and among Hamburg Commercial Bank AG and the banks and financial institutions listed in Schedule 1 thereto, and Liono Shipping Co., Snoopy Shipping
Co., Cinderella Shipping Co., and Luffy Shipping Co., as borrowers.
|
|
$23.15 Million Term Loan Facility, dated November 22, 2021, by and among Chailease International Financial Services Co., Ltd., as lender, and Bagheera Shipping Co. and Garfield Shipping Co., as borrowers.
|
|
$55.0 Million Term Loan Facility, dated January 12, 2022, by and among Deutsche Bank AG, as lender, and Mulan Shipping Co., Johnny Bravo Shipping Co., Songoku Shipping Co., Asterix Shipping Co. and Stewie
Shipping Co., as borrowers.
|
|
Master Management Agreement, dated September 1, 2020, by and among the Company, its shipowning subsidiaries and Castor Ships S.A., incorporated by reference to Exhibit 99.3 of the Company’s report on Form
6-K furnished with the SEC on September 11, 2020.
|
Securities Purchase Agreement by and between the Company and the purchasers identified on the signature pages thereto, dated July 12, 2020, incorporated by reference to Exhibit 4.2 of the Company’s report
on Form 6-K furnished with the SEC on July 15, 2020.
|
|
Securities Purchase Agreement by and between the Company and the purchasers identified on the signature pages thereto, dated December 30, 2020, incorporated by reference to Exhibit 4.2 of the Company’s
report on Form 6-K furnished with the SEC on January 5, 2021.
|
|
Securities Purchase Agreement by and between the Company and the purchasers identified on the signature pages thereto, dated January 8, 2021, incorporated by reference to Exhibit 4.2 of the Company’s report
on Form 6-K furnished with the SEC on January 12, 2021.
|
|
Securities Purchase Agreement by and between the Company and the purchasers identified on the signature pages thereto, dated April 5, 2021, incorporated by reference to Exhibit 4.2 of the Company’s report
on Form 6-K furnished with the SEC on April 7, 2021.
|
|
Amended and Restated Equity Distribution Agreement, dated March 31, 2022, by and among the
Company and Maxim Group LLC, incorporated by reference to Exhibit 1.3 of Amendment No. 1 to the Company’s registration statement on Form F-3 filed with
the SEC on March 31, 2022.
|
|
List of Subsidiaries.
|
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer and Chief Financial Officer.
|
|
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
101.INS
|
Inline XBRL Instance Document
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
101.CAL
|
Inline XBRL Taxonomy Extension Schema Calculation Linkbase Document
|
101.DEF
|
Inline XBRL Taxonomy Extension Schema Definition Linkbase Document
|
101.LAB
|
Inline XBRL Taxonomy Extension Schema Label Linkbase Document
|
101.PRE
|
Inline XBRL Taxonomy Extension Schema Presentation Linkbase Document
|
104
|
Cover Page Interactive Data File (Inline XBRL)
|
CASTOR MARITIME INC.
|
||
/s/ Petros Panagiotidis
|
March 31, 2022
|
|
Name: Petros Panagiotidis
|
||
Title: Chairman, Chief Executive Officer and
Chief Financial Officer |
|
Page
|
Report of Independent Registered Public Accounting Firm (PCAOB ID 1163)
|
F-2
|
F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7
|
Note
|
Year Ended
December 31,
2019
|
Year Ended
December 31,
2020
|
Year Ended
December 31,
2021
|
|||||||||||||
REVENUES:
|
||||||||||||||||
Vessel revenues (net of commissions to charterers of $302,556,
$629,015 and $4,417,505
for the years ended December 31, 2019, 2020 and 2021, respectively)
|
12 |
$
|
5,967,772
|
$
|
12,487,692
|
$
|
132,049,710
|
|||||||||
Total revenues
|
5,967,772
|
12,487,692
|
132,049,710
|
|||||||||||||
EXPENSES:
|
||||||||||||||||
Voyage expenses (including $40,471, $29,769 and $1,671,145 to
related parties for the years ended December 31, 2019, 2020 and 2021, respectively)
|
3,13
|
(261,179
|
)
|
(584,705
|
)
|
(12,950,783
|
)
|
|||||||||
Vessel operating expenses
|
13
|
(2,802,991
|
)
|
(7,447,439
|
)
|
(39,203,471
|
)
|
|||||||||
Management fees to related parties
|
3
|
(212,300
|
)
|
(930,500
|
)
|
(6,744,750
|
)
|
|||||||||
Depreciation and amortization
|
4,6
|
(897,171
|
)
|
(1,904,963
|
)
|
(14,362,828
|
)
|
|||||||||
Provision for doubtful accounts
|
2
|
—
|
(37,103
|
)
|
(2,483
|
)
|
||||||||||
General and administrative expenses
|
14
|
|||||||||||||||
- Company administration expenses (including $0, $400,000, and $1,200,000 to
related party for the years ended December 31, 2019, 2020 and 2021)
|
(378,777
|
)
|
(1,130,953
|
)
|
(3,266,310
|
)
|
||||||||||
- Public registration costs
|
(132,091
|
)
|
—
|
—
|
||||||||||||
Total expenses
|
(4,684,509
|
)
|
(12,035,663
|
)
|
(76,530,625
|
)
|
||||||||||
Operating income
|
1,283,263
|
452,029
|
55,519,085
|
|||||||||||||
OTHER INCOME/ (EXPENSES):
|
||||||||||||||||
Interest and finance costs (including $162,500, $305,000 and $204,167 to related
party for the years ended December 31, 2019, 2020 and 2021, respectively)
|
3,7,15
|
(222,163
|
)
|
(2,189,577
|
)
|
(2,854,998
|
)
|
|||||||||
Interest income
|
31,589
|
34,976
|
75,123
|
|||||||||||||
Foreign exchange (losses)/ gains
|
(4,540
|
)
|
(29,321
|
)
|
28,616
|
|||||||||||
Total other expenses, net
|
(195,114
|
)
|
(2,183,922
|
)
|
(2,751,259
|
)
|
||||||||||
Net income/(loss) and comprehensive income/(loss), before taxes
|
$
|
1,088,149
|
$
|
(1,731,893
|
)
|
$
|
52,767,826
|
|||||||||
US Source Income Taxes
|
16 |
—
|
(21,640
|
)
|
(497,339
|
)
|
||||||||||
Net income/(loss) and comprehensive income/(loss)
|
$
|
1,088,149
|
$
|
(1,753,533
|
)
|
$
|
52,270,487
|
|||||||||
Cumulative dividends on Series A Preferred Shares
|
11 |
(372,022 | ) | — | — | |||||||||||
Gain on extinguishment of Series A Preferred Shares
|
8,11 |
112,637 | — | — | ||||||||||||
Deemed dividend on Series A preferred shares
|
8,11 |
— | — | (11,772,157 | ) | |||||||||||
Net income/(loss) and comprehensive income/(loss) attributable to common shareholders
|
828,764 | (1,753,533 | ) | 40,498,330 | ||||||||||||
Earnings/(Loss) per common share, basic
|
11
|
3.11
|
(0.26
|
)
|
0.48
|
|||||||||||
Earnings/(Loss) per common share, diluted
|
11 |
$ | 3.11 | $ | (0.26 | ) | $ | 0.47 | ||||||||
Weighted average number of common shares, basic
|
266,238 | 6,773,519 | 83,923,435 | |||||||||||||
Weighted average number of common shares, diluted
|
266,238
|
6,773,519
|
85,332,728
|
Number of shares issued
|
Par Value of
Shares issued
|
Additional Paid-in capital
|
Retained earnings/
(Accumulated deficit)
|
Total Shareholders’ Equity
|
||||||||||||||||||||||||
Common shares
|
Preferred A shares
|
Preferred B shares
|
||||||||||||||||||||||||||
Balance, December 31, 2018
|
240,000
|
480,000
|
12,000
|
732
|
7,614,268
|
2,136,024
|
9,751,024
|
|||||||||||||||||||||
- Issuance of common stock, net of commissions and issuance costs, pursuant to the First ATM Program (Note 8)
|
61,811
|
—
|
—
|
62
|
2,319,639
|
—
|
2,319,701
|
|||||||||||||||||||||
- Issuance of common stock related to Series A Preferred Stock dividends (Note 8)
|
30,000
|
—
|
—
|
30
|
967,770
|
(967,800
|
)
|
—
|
||||||||||||||||||||
- Series A Preferred Stock dividend waived accounted as deemed contribution (Note 8)
|
—
|
—
|
—
|
—
|
3,379,589
|
—
|
3,379,589
|
|||||||||||||||||||||
- Series A Preferred Stock dividend waived (Note 8)
|
—
|
—
|
—
|
—
|
(1,560,014
|
)
|
(1,819,575
|
)
|
(3,379,589
|
)
|
||||||||||||||||||
- Gain on extinguishment of preferred stock pursuant to the Series A Preferred Stock Amendment Agreement, net of expenses (Note 8)
|
—
|
—
|
—
|
—
|
112,637
|
—
|
112,637
|
|||||||||||||||||||||
- Preferred shareholders’ deemed dividend pursuant to the Series A Preferred Stock Amendment Agreement (Note 8)
|
—
|
—
|
—
|
—
|
(130,000
|
)
|
—
|
(130,000
|
)
|
|||||||||||||||||||
- Shareholder’s deemed contribution pursuant to the $7.5
Million Bridge Loan
|
—
|
—
|
—
|
—
|
62,500
|
—
|
62,500
|
|||||||||||||||||||||
- Net income
|
—
|
—
|
—
|
—
|
—
|
1,088,149
|
1,088,149
|
|||||||||||||||||||||
Balance, December 31, 2019
|
331,811
|
480,000
|
12,000
|
824
|
12,766,389
|
436,798
|
13,204,011
|
|||||||||||||||||||||
- Issuance of
common stock pursuant to the $5.0 Million Convertible Debentures (Note 7)
|
804,208
|
—
|
—
|
804
|
5,056,969
|
—
|
5,057,773
|
|||||||||||||||||||||
- Issuance of common stock pursuant to the 2020 June Equity Offering, net of issuance costs (Note 8)
|
5,908,269
|
—
|
—
|
5,908
|
18,592,344
|
—
|
18,598,252
|
|||||||||||||||||||||
- Issuance of common stock pursuant to the 2020 July Equity Offering, net of issuance costs (Note 8)
|
5,775,000
|
—
|
—
|
5,775
|
15,682,079
|
—
|
15,687,854
|
|||||||||||||||||||||
- Issuance of common stock pursuant to the exercise of Class A Warrants (Note 8)
|
301,950
|
—
|
—
|
302
|
1,056,523
|
—
|
1,056,825
|
|||||||||||||||||||||
- Beneficial conversion feature pursuant to the issuance of the $5.0
Million Convertible Debentures (Note 7)
|
—
|
—
|
—
|
—
|
532,437
|
—
|
532,437
|
|||||||||||||||||||||
-Net loss
|
—
|
—
|
—
|
—
|
—
|
(1,753,533
|
)
|
(1,753,533
|
)
|
|||||||||||||||||||
Balance, December 31, 2020
|
13,121,238
|
480,000
|
12,000
|
13,613
|
53,686,741
|
(1,316,735
|
)
|
52,383,619
|
||||||||||||||||||||
- Issuance of common stock pursuant to the registered direct offerings (Note 8)
|
42,405,770 | — | — | 42,406 | 156,824,134 | — | 156,866,540 | |||||||||||||||||||||
- Issuance of common stock pursuant to warrant exercises (Note 8)
|
34,428,840 | — | — | 34,429 | 83,386,517 | — | 83,420,946 | |||||||||||||||||||||
- Issuance of common stock pursuant to the Second ATM Program (Note 8)
|
4,654,240 | — | — | 4,654 | 12,388,124 | — | 12,392,778 | |||||||||||||||||||||
- Redemption of Series A Preferred Shares (Note 8)
|
(480,000 | ) | (480 | ) | (2,627,363 | ) | (11,772,157 | ) | (14,400,000 | ) | ||||||||||||||||||
-Net income
|
— | — | — | — | — | 52,270,487 | 52,270,487 | |||||||||||||||||||||
Balance, December 31, 2021
|
94,610,088 | — | 12,000 | 94,622 | 303,658,153 | 39,181,595 | 342,934,370 |
1.
|
Basis of Presentation and General information
|
Company
|
Country of
incorporation |
Vessel Name
|
DWT
|
Year Built
|
Delivery date
to Castor
|
|
1 |
Spetses Shipping Co. (“Spetses”)
|
Marshall Islands
|
M/V Magic P
|
76,453
|
|
|
2 |
Bistro Maritime Co. (“Bistro”)
|
Marshall Islands
|
M/V Magic Sun
|
75,311
|
|
|
3 |
Pikachu Shipping Co. (“Pikachu”)
|
Marshall Islands
|
M/V Magic Moon
|
76,602
|
|
|
4 |
Bagheera Shipping Co. (“Bagheera”)
|
Marshall Islands
|
M/V Magic Rainbow
|
73,593
|
|
|
5 |
Pocahontas Shipping Co. (“Pocahontas”)
|
Marshall Islands
|
M/V Magic Horizon
|
76,619
|
|
|
6
|
Jumaru Shipping Co. (“Jumaru”)
|
Marshall Islands
|
M/V Magic Nova
|
78,833
|
|
|
7 |
Super Mario Shipping Co. (“Super Mario”) | Marshall Islands | M/V Magic Venus | 83,416 | ||
8 |
Pumba Shipping Co. (“Pumba”) | Marshall Islands | M/V Magic Orion | 180,200 | ||
9 |
Kabamaru Shipping Co. (“Kabamaru”) | Marshall Islands | M/V Magic Argo | 82,338 | ||
10 |
Luffy Shipping Co. (“Luffy”) | Marshall Islands | M/V Magic Twilight | 80,283 | ||
11 |
Liono Shipping Co. (“Liono”) | Marshall Islands | M/V Magic Thunder | 83,375 | ||
12 |
Stewie Shipping Co. (“Stewie”) | Marshall Islands | M/V Magic Vela | 75,003 | ||
13 |
Snoopy Shipping Co. (“Snoopy”) | Marshall Islands | M/V Magic Nebula | 80,281 | ||
14 |
Mulan Shipping Co. (“Mulan”) | Marshall Islands | M/V Magic Starlight | 81,048 | ||
15 |
Cinderella Shipping Co. (“Cinderella”) | Marshall Islands | M/V Magic Eclipse | 74,940 | ||
16 |
Rocket Shipping Co. (“Rocket”) | Marshall Islands | M/T Wonder Polaris | 115,351 | ||
17 |
Gamora Shipping Co. (“Gamora”) | Marshall Islands | M/T Wonder Sirius | 115,341 | ||
18 |
Starlord Shipping Co. (“Starlord”) | Marshall Islands | M/T Wonder Vega | 106,062 | ||
19 |
Hawkeye Shipping Co. (“Hawkeye”) | Marshall Islands | M/T Wonder Avior | 106,162 | ||
20 |
Elektra Shipping Co. (“Elektra”) | Marshall Islands | M/T Wonder Arcturus | 106,149 | ||
21 |
Vision Shipping Co. (“Vision”) | Marshall Islands | M/T Wonder Mimosa | 36,718 | ||
22 |
Colossus Shipping Co. (“Colossus”) | Marshall Islands | M/T Wonder Musica | 106,290 |
1.
|
Basis of Presentation and General information (continued):
|
1
|
Mickey Shipping Co. (“Mickey”) incorporated under the laws of the Marshall Islands
|
1
|
Castor Maritime SCR Corp. (1)
|
(1)
|
Incorporated under the laws of the Marshall Islands,
this entity serves as the Company’s vessel owning subsidiaries’ cash manager with effect from November 1, 2021.
|
Charterer
|
Year Ended
December 31, 2019
|
Year Ended
December 31, 2020
|
Year Ended
December 31, 2021
|
|||||||||
A
|
63
|
%
|
34
|
%
|
20
|
%
|
||||||
B
|
—
|
% |
—
|
% |
12
|
%
|
||||||
C
|
—
|
% |
—
|
% |
11
|
%
|
||||||
D
|
13
|
%
|
—
|
%
|
—
|
% | ||||||
E |
12
|
%
|
24
|
%
|
—
|
%
|
||||||
F |
12
|
%
|
—
|
%
|
—
|
% | ||||||
Total
|
100
|
%
|
58
|
%
|
43
|
%
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements:
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
2. |
Significant Accounting Policies and Recent Accounting Pronouncements (continued):
|
3. |
Transactions with Related Parties:
|
Year ended
December 31,
2019
|
Year ended
December 31,
2020
|
Year ended
December 31,
2021
|
||||||||||
Management fees-related parties
|
||||||||||||
Management fees – Pavimar (a)
|
$
|
212,300
|
$
|
768,000
|
$
|
4,761,000
|
||||||
Management fees – Castor Ships (c)
|
—
|
162,500
|
1,983,750
|
|||||||||
Included in Voyage expenses
|
||||||||||||
Charter hire commissions – Castor Ships (c)(d)
|
$
|
40,471
|
$
|
29,769
|
$
|
1,671,145
|
||||||
Included in Interest and finance
costs
|
||||||||||||
Interest expenses (b) – Thalassa
|
$
|
162,500
|
$
|
305,000
|
$
|
204,167
|
||||||
Included in General and
administrative expenses
|
||||||||||||
Administration fees – Castor Ships (c)
|
$
|
—
|
$
|
400,000
|
$
|
1,200,000
|
||||||
Included in Vessels’ cost
|
||||||||||||
Sale & purchase commission – Castor Ships (c)
|
$
|
—
|
$
|
138,600
|
$
|
3,406,400
|
December 31,
2020
|
December 31,
2021
|
|||||||
Assets:
|
||||||||
Due from Pavimar (a) – current
|
$
|
1,559,132
|
$
|
—
|
||||
Due from Pavimar (a) – non-current
|
— | 810,437 | ||||||
Liabilities:
|
||||||||
Due to Pavimar (a) – current
|
— | 3,909,885 | ||||||
Related party debt (b) – Thalassa
|
$
|
5,000,000
|
$
|
—
|
||||
Accrued loan interest (b) – Thalassa
|
405,000
|
—
|
||||||
Voyage commissions, management fees and other
expenses due to Castor Ships (c)
|
1,941
|
597,684
|
3. |
Transactions with Related Parties (continued):
|
3. |
Transactions with Related Parties (continued):
|
4. |
Deferred charges, net:
|
Dry-docking
costs
|
||||
Balance December 31, 2018
|
$
|
341,070
|
||
Amortization
|
(341,070
|
)
|
||
Balance December 31, 2019
|
$
|
—
|
||
Additions | 2,216,102 | |||
Amortization
|
(154,529
|
)
|
||
Balance December 31, 2020
|
$
|
2,061,573
|
||
Additions
|
3,936,331
|
|||
Amortization
|
(1,135,080
|
)
|
||
Balance December 31, 2021
|
$
|
4,862,824
|
5.
|
Fair value of acquired time charter:
|
6. |
Vessels, net/ Advances for vessel acquisition:
|
Vessel Cost
|
Accumulated depreciation
|
Net Book Value
|
||||||||||
Balance December 31, 2019
|
24,810,061
|
(1,110,032
|
)
|
23,700,029
|
||||||||
— Acquisitions, improvements, and other vessel costs
|
36,096,033
|
—
|
36,096,033
|
|||||||||
— Period depreciation
|
—
|
(1,750,434
|
)
|
(1,750,434
|
)
|
|||||||
Balance December 31, 2020
|
60,906,094
|
(2,860,466
|
)
|
58,045,628
|
||||||||
— Acquisitions, improvements, and other vessel costs
|
299,460,599
|
—
|
299,460,599
|
|||||||||
— Transfers from Advances for vessel acquisitions (b) | 49,687,450 | — |
49,687,450 | |||||||||
— Period depreciation
|
—
|
(13,227,748
|
)
|
(13,227,748
|
)
|
|||||||
Balance December 31, 2021
|
410,054,143
|
(16,088,214
|
)
|
393,965,929
|
6. |
Vessels, net/ Advances for vessel acquisition (continued):
|
Vessel Name
|
Vessel Type
|
DWT
|
Year Built
|
Country of Construction
|
Purchase Price (in million)
|
Delivery Date
|
2020 Acquisitions
|
||||||
Magic Rainbow
|
Panamax
|
73,593
|
|
China
|
$7.85
|
08/08/2020
|
Magic Horizon
|
Panamax
|
76,619
|
|
Japan
|
$12.75 |
10/09/2020
|
Magic Nova
|
Panamax
|
78,833
|
|
Japan
|
$13.86
|
10/15/2020
|
2021 Acquisitions
|
||||||
Magic Venus
|
Kamsarmax
|
83,416
|
|
Japan
|
$15.85
|
03/02/2021
|
Wonder Polaris
|
Aframax LR2
|
115,351
|
|
S. Korea
|
$13.60
|
03/11/2021
|
Magic Orion
|
Capesize
|
180,200
|
|
Japan
|
$17.50
|
03/17/2021
|
Magic Argo
|
Kamsarmax
|
82,338
|
|
Japan
|
$14.50
|
03/18/2021
|
Wonder Sirius
|
Aframax LR2
|
115,341
|
|
S. Korea
|
$13.60
|
03/22/2021
|
Magic Twilight
|
Kamsarmax
|
80,283
|
|
S. Korea
|
$14.80
|
04/09/2021
|
Magic Thunder
|
Kamsarmax
|
83,375
|
|
Japan
|
$16.85
|
04/13/2021
|
Magic Vela
|
Panamax
|
75,003
|
|
China
|
$14.50
|
05/12/2021
|
Magic Nebula
|
Kamsarmax
|
80,281
|
|
S. Korea
|
$15.45
|
05/20/2021
|
Wonder Vega
|
Aframax
|
106,062
|
|
S. Korea
|
$14.80
|
05/21/2021
|
Magic Starlight
|
Kamsarmax
|
81,048
|
|
China
|
$23.50
|
05/23/2021
|
Wonder Avior
|
Aframax LR2
|
106,162
|
|
S. Korea
|
$12.00
|
05/27/2021
|
Wonder Arcturus
|
Aframax LR2
|
106,149
|
|
S. Korea
|
$10.00
|
05/31/2021
|
Wonder Mimosa
|
Handysize
|
36,718
|
|
S. Korea
|
$7.25
|
05/31/2021
|
Magic Eclipse
|
Panamax
|
74,940
|
|
Japan
|
$18.48 |
06/07/2021
|
Wonder Musica
|
Aframax LR2
|
106,290
|
|
S. Korea
|
$12.00 |
06/15/2021
|
Wonder Formosa
|
Handysize
|
36,660
|
|
S. Korea
|
$8.00
|
06/22/2021
|
Magic Pluto
|
Panamax
|
74,940
|
|
Japan
|
$19.06
|
08/06/2021
|
Magic Perseus
|
Kamsarmax
|
82,158
|
|
Japan
|
$21.00
|
08/09/2021
|
Magic Mars
|
Panamax
|
76,822
|
|
S. Korea
|
$20.40
|
09/20/2021
|
Magic Phoenix
|
Panamax
|
76,636
|
|
Japan
|
$18.75
|
10/26/2021
|
Wonder Bellatrix
|
Aframax LR2
|
115,341
|
|
S. Korea
|
$18.15
|
12/23/2021
|
6. |
Vessels, net/ Advances for vessel acquisition (continued):
|
(b)
|
Advances for vessel acquisition
|
Vessel Cost
|
||||
Balance December 31, 2020
|
$
|
—
|
||
— Advances for vessel acquisitions and other vessel pre-delivery costs
|
52,055,615
|
|||
—Transfer to Vessels, net (a)
|
(49,687,450
|
)
|
||
Balance December 31, 2021
|
$
|
2,368,165
|
7. |
Long-Term Debt:
|
Year Ended
|
|||||||||
Loan facilities
|
Borrowers
|
December 31,
2020
|
December 31,
2021
|
||||||
$11.0 Million Term Loan Facility (a)
|
Spetses- Pikachu
|
$
|
9,400,000
|
$
|
7,800,000
|
||||
$4.5 Million Term Loan Facility (b)
|
Bistro
|
4,050,000
|
3,450,000
|
||||||
$15.29 Million Term Loan Facility (c)
|
Pocahontas- Jumaru
|
— | 13,877,000 | ||||||
$18.0 Million Term Loan Facility (d)
|
Rocket- Gamora
|
— | 16,300,000 | ||||||
$40.75 Million Term Loan Facility (e)
|
Liono-Snoopy-Cinderella-Luffy
|
— | 39,596,000 | ||||||
$23.15 Million Term Loan Facility (f)
|
Bagheera-Garfield
|
— | 22,738,500 | ||||||
Total long-term debt
|
$
|
13,450,000
|
$
|
103,761,500
|
|||||
Less: Deferred financing costs
|
(264,134
|
)
|
(1,720,101
|
)
|
|||||
Total long-term debt, net of
deferred finance costs
|
$
|
13,185,866
|
102,041,399
|
||||||
Presented:
|
|||||||||
Current portion of long-term debt
|
$
|
2,200,000
|
$
|
16,688,000
|
|||||
Less: Current portion of
deferred finance costs
|
(97,963
|
)
|
(596,277
|
)
|
|||||
Current portion of long-term
debt, net of deferred finance costs
|
$
|
2,102,037
|
$
|
16,091,723
|
|||||
Non-Current portion of long-term
debt
|
11,250,000
|
87,073,500
|
|||||||
Less: Non-Current portion of
deferred finance costs
|
(166,171
|
)
|
(1,123,824
|
)
|
|||||
Non-Current portion of long-term
debt, net of deferred finance costs
|
$
|
11,083,829
|
$
|
85,949,676
|
|||||
Debt instruments from related
party
|
|||||||||
$5.0 Million Term Loan Facility (Note 3(b))
|
Castor
|
5,000,000
|
—
|
||||||
Total long-term debt from related
party, current
|
$
|
5,000,000
|
$
|
—
|
7. |
Long-Term Debt (continued):
|
a. |
$11.0 Million Term Loan Facility:
|
b. |
$4.5 Million Term Loan Facility:
|
c. |
$15.29 Million Term Loan Facility
|
7. |
Long-Term Debt (continued):
|
d.
|
$18.0 Million Term Loan Facility
|
e. |
$40.75 Million Term Loan Facility
|
f. |
$23.15 Million Term Loan Facility
|
7. |
Long-Term Debt (continued):
|
g.
|
$5.0 Million Convertible Debentures:
|
Year ending December 31,
|
Amount
|
|||
2022
|
$
|
16,688,000
|
||
2023
|
14,743,400
|
|||
2024
|
16,604,400
|
|||
2025
|
24,545,400
|
|||
2026
|
31,180,300
|
|||
Total long-term debt
|
$
|
103,761,500
|
7. |
Long-Term Debt (continued):
|
8. |
Equity Capital Structure:
|
(a) |
Common Shares:
|
8. |
Equity Capital Structure (continued):
|
8. |
Equity Capital Structure (continued):
|
8. |
Equity Capital Structure (continued):
|
(b) |
Preferred Shares:
|
8. |
Equity Capital Structure (continued):
|
i) |
waive all dividend payment obligations on the Series A Preferred Shares during the period
from July 1, 2019 until December 31, 2021;
|
ii) |
reduce the previous progressively increasing dividend payment default rate that was 1.30 times the rate payable on the Series A Preferred Shares on the date preceding such payment to a fixed dividend payment default rate that
is 1.30 times the base dividend payment rate;
|
iii) |
increase the redemption price of the Series A Preferred Shares to $30 from $25 per share in case
that the Company exercises its current option to redeem the Series A Preferred Shares, in whole or in part, with cash; and
|
iv) |
increase the liquidation preference from $25 to $30 per Series A Preferred Share.
|
8. |
Equity Capital Structure (continued):
|
9. |
Financial Instruments and Fair Value
Disclosures:
|
◾ |
Cash and cash equivalents, restricted cash, accounts receivable trade, net, amounts due from/to related party/(ies) and accounts payable: The
carrying values reported in the accompanying consolidated balance sheets for those financial instruments are reasonable estimates of their fair values due to their short-term maturity nature. Cash and cash equivalents and restricted
cash, current are considered Level 1 items as they represent liquid assets with short term maturities. The carrying value approximates the fair market value for interest bearing cash classified as restricted cash, non-current and is
considered Level 1 item of the fair value hierarchy. The carrying value of these instruments is reflected in the accompanying consolidated balance sheets.
|
◾ |
Long-term debt: The secured credit facilities discussed in Note 7, have a recorded value which is a reasonable estimate of their fair value due
to their variable interest rate and are thus considered Level 2 items in accordance with the fair value hierarchy as LIBOR rates are observable at commonly quoted intervals for the full terms of the loans.
|
10. |
Commitments and contingencies:
|
10. |
Commitments and contingencies
(continued):
|
(a) |
Commitments under Contracts for BWMS
Installation
|
(b) |
Commitments under long-term lease
contracts
|
Twelve-month period ending December 31,
|
Amount
|
|||
2022
|
$
|
25,772,380
|
||
Total
|
$
|
25,772,380
|
11. |
Earnings/ (Loss) Per Share:
|
11. |
Earnings/ (Loss) Per Share (continued):
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
2019
|
2020
|
2021
|
||||||||||
Net income/(loss) and comprehensive income/(loss)
|
$
|
1,088,149
|
$
|
(1,753,533
|
)
|
$
|
52,270,487
|
|||||
Less: Cumulative dividends on Series A Preferred Shares
|
(372,022
|
)
|
—
|
—
|
||||||||
Plus: Gain on extinguishment of preferred shares pursuant to the Series A Preferred Stock Amendment Agreement, net of expenses
|
112,637
|
—
|
—
|
|||||||||
Less: Deemed dividend on Series A Preferred Shares
|
— | — | (11,772,157 | ) | ||||||||
Net income/(loss) and comprehensive income/(loss) available to common shareholders
|
828,764
|
(1,753,533
|
)
|
40,498,330
|
||||||||
Weighted average number of common shares outstanding, basic
|
266,238
|
6,773,519
|
83,923,435
|
|||||||||
Earnings/(Loss) per common share, basic
|
|
3.11
|
|
(0.26
|
)
|
|
0.48
|
|||||
Plus: Dilutive effect of warrants
|
— | — | 1,409,293 | |||||||||
Weighted average number of common shares outstanding, diluted
|
266,238 | 6,773,519 | 85,332,728 | |||||||||
Earnings/(Loss) per common share, diluted
|
$ | 3.11 | $ | (0.26 | ) | $ | 0.47 |
12. |
Vessel Revenues:
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
2019
|
2020
|
2021
|
||||||||||
Time charter revenues
|
$
|
5,967,772
|
12,487,692
|
111,900,699
|
||||||||
Voyage charter revenues
|
—
|
—
|
15,002,012
|
|||||||||
Pool revenues
|
—
|
—
|
5,146,999
|
|||||||||
Total Vessel revenues
|
$
|
5,967,772
|
$
|
12,487,692
|
$
|
132,049,710
|
12. |
Vessel Revenue (continued):
|
13. |
Vessel Operating and Voyage Expenses:
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
Vessel Operating Expenses
|
2019
|
2020
|
2021
|
|||||||||
Crew & crew related costs
|
$ |
1,396,477
|
3,753,578
|
21,532,311
|
||||||||
Repairs & maintenance, spares, stores, classification, chemicals & gases, paints, victualling
|
868,915
|
2,314,260
|
9,828,139
|
|||||||||
Lubricants
|
153,969
|
429,967
|
2,375,901
|
|||||||||
Insurances
|
189,781
|
507,885
|
3,126,169
|
|||||||||
Tonnage taxes
|
50,553
|
131,674
|
592,701
|
|||||||||
Other
|
143,296
|
310,075
|
1,748,250
|
|||||||||
Total Vessel operating expenses
|
$
|
2,802,991
|
$
|
7,447,439
|
$
|
39,203,471
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
Voyage expenses
|
2019
|
2020
|
2021
|
|||||||||
Brokerage commissions
|
$ |
46,708
|
158,538
|
1,733,639
|
||||||||
Brokerage commissions- related party
|
40,471 | 29,769 | 1,671,145 | |||||||||
Port & other expenses
|
46,100
|
173,645
|
4,520,584
|
|||||||||
Bunkers consumption
|
87,760 | 321,252 | 7,742,450 | |||||||||
Loss/(Gain) on bunkers
|
40,140
|
(98,499
|
)
|
(2,717,035
|
)
|
|||||||
Total Voyage expenses
|
$ |
261,179
|
$ |
584,705
|
$ |
12,950,783
|
14. |
General and Administrative Expenses:
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
2019 | 2020 | 2021 | ||||||||||
Audit fees
|
$
|
119,535
|
$
|
129,420
|
$
|
265,744
|
||||||
Chief Executive and Chief Financial Officer and directors’ compensation
|
12,000
|
29,000
|
48,000
|
|||||||||
Other professional fees
|
247,242
|
572,533
|
1,752,566
|
|||||||||
Administration fees-related party (Note 3(c))
|
—
|
400,000
|
1,200,000
|
|||||||||
Total
|
$
|
378,777
|
$
|
1,130,953
|
$
|
3,266,310
|
14. |
General and Administrative Expenses (continued):
|
15. |
Interest and Finance Costs:
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended
December 31,
|
||||||||||
2019 |
2020 |
2021 |
||||||||||
Interest on long-term debt
|
$
|
47,585
|
$
|
668,152
|
$
|
2,028,676
|
||||||
Interest on long-term debt – related party (Note 3 (b))
|
162,500
|
305,000
|
204,167
|
|||||||||
Interest on convertible debt – non cash
|
—
|
57,773
|
—
|
|||||||||
Amortization and write-off of deferred finance charges
|
6,628
|
599,087
|
414,629
|
|||||||||
Amortization and write-off of convertible notes beneficial conversion features
|
—
|
532,437
|
—
|
|||||||||
Other finance charges
|
5,450
|
27,128
|
207,526
|
|||||||||
Total
|
$
|
222,163
|
$
|
2,189,577
|
$
|
2,854,998
|
16. |
Income Taxes:
|
17. |
Segment Information:
|
Year ended
December 31,
|
Year ended
December 31,
|
Year ended December 31,
|
||||||||||||||||||||||
2019
|
2020
|
2021
|
||||||||||||||||||||||
Dry bulk
segment
|
Dry bulk
segment
|
Dry bulk
segment
|
Aframax/LR2
tanker
segment
|
Handysize
tanker
segment
|
Total
|
|||||||||||||||||||
- Time charter revenues
|
$
|
5,967,772
|
$
|
12,487,692
|
$
|
102,785,442
|
$
|
9,115,257
|
$
|
—
|
$
|
111,900,699
|
||||||||||||
- Voyage charter revenues
|
—
|
—
|
—
|
15,002,012
|
—
|
15,002,012
|
||||||||||||||||||
- Pool revenues
|
—
|
—
|
—
|
2,442,144
|
2,704,855
|
5,146,999
|
||||||||||||||||||
Vessel revenues, net
|
$
|
5,967,772
|
$
|
12,487,692
|
$
|
102,785,442
|
$
|
26,559,413
|
$
|
2,704,855
|
$
|
132,049,710
|
||||||||||||
Voyage expenses (including charges from related parties)
|
(261,179
|
)
|
(584,705
|
)
|
(1,891,265
|
)
|
(11,003,925
|
)
|
(55,593
|
)
|
(12,950,783
|
)
|
||||||||||||
Vessel operating expenses
|
(2,802,991
|
)
|
(7,447,439
|
)
|
(26,841,600
|
)
|
(9,776,724
|
)
|
(2,585,147
|
)
|
(39,203,471
|
)
|
||||||||||||
Management fees to related parties
|
(212,300
|
)
|
(930,500
|
)
|
(4,890,900
|
)
|
(1,433,950
|
)
|
(419,900
|
)
|
(6,744,750
|
)
|
||||||||||||
Depreciation and amortization
|
(897,171
|
)
|
(1,904,963
|
)
|
(10,528,711
|
)
|
(3,087,764
|
)
|
(746,353
|
)
|
(14,362,828
|
)
|
||||||||||||
Provision for doubtful accounts
|
—
|
(37,103
|
)
|
(2,483
|
)
|
—
|
—
|
(2,483
|
)
|
|||||||||||||||
Segments operating income/(loss) (1)
|
$
|
1,794,131
|
$
|
1,582,982
|
$
|
58,630,483
|
$
|
1,257,050
|
$
|
(1,102,138
|
)
|
$
|
58,785,395
|
|||||||||||
Less: Unallocated corporate general and administrative expenses
|
(510,868
|
)
|
(1,130,953
|
)
|
—
|
—
|
—
|
(3,266,310
|
)
|
|||||||||||||||
Total consolidated operating income/(loss)
|
$
|
1,283,263
|
$
|
452,029
|
$
|
58,630,483
|
$
|
1,257,050
|
$
|
(1,102,138
|
)
|
$
|
55,519,085
|
(1)
|
Does not include unallocated corporate
general and administrative expenses amounting to $510,868, $1,130,953 and $3,266,310 in each of the years
ended December 31, 2019, 2020 and 2021, respectively.
|
Year Ended
December 31,
2020
|
Year Ended
December 31,
2021
|
|||||||
Dry bulk segment
|
$
|
67,387,635
|
$
|
314,407,704
|
||||
Aframax tanker segment
|
—
|
104,953,507
|
||||||
Handysize tanker segment
|
—
|
19,093,379
|
||||||
Cash and cash equivalents (1)
|
6,882,398
|
23,950,795
|
||||||
Prepaid expenses and other assets (1)
|
101,322
|
508,057
|
||||||
Total consolidated assets
|
$
|
74,371,355
|
$
|
462,913,442
|
(1)
|
Refers to assets of other
entities (Castor Maritime Inc. and Castor Maritime SCR Corp.) included in the consolidated financial statements.
|
18. |
Subsequent Events:
|
(a) |
Delivery of the
Magic Callisto: On January 4, 2022, the Company’s wholly owned subsidiary,
Mickey, pursuant to a purchase agreement entered into on December 17, 2021, took delivery of the Magic Callisto, a Japanese-built Panamax dry bulk carrier acquired from a third-party in which a family member of Petros Panagiotidis had
a minority interest. The vessel was purchased for $23.55 million. The terms of the transaction were negotiated and approved
by a special committee of disinterested and independent directors of the Company.
|
(b) |
Entry into $55.0 million financing: On January 12, 2022, the Company entered into a $55.0 million senior secured
term loan facility with Deutsche Bank AG, through and secured by five of the Company’s dry bulk ship-owning subsidiaries,
those owning the Magic Starlight, Magic Mars, Magic Pluto, Magic Perseus and the Magic Vela, and guaranteed by the Company. This facility has a tenor of five years, bears interest at a margin over adjusted SOFR per annum and contains a standard security package including a first preferred cross-collateralized
mortgage on the vessels owned by the borrowers, pledge of bank accounts, charter assignments, shares pledge, a general assignment over the vessel’s earnings, insurances, and any requisition compensation in relation to the vessel owned
by the borrower, and managers’ undertakings and is guaranteed by the Company. Pursuant to the terms of this facility, the borrowers are subject to (i) a specified minimum security cover requirement, which is the maximum ratio of the aggregate principal amounts due under the facility to the aggregate market
value of the mortgaged vessels plus the value of the dry-dock reserve accounts referred to below and any additional security, and (ii) to certain minimum liquidity restrictions requiring us to maintain certain blocked and free
liquidity cash balances with the lender, to maintain and gradually fund certain dry-dock reserve accounts in order to ensure the payment of any costs incurred in relation to the next dry-docking of each mortgaged vessel, as well as to
certain customary, for this type of facilities, negative covenants. Moreover, the facility contains certain financial covenants requiring the Company as guarantor to maintain (i) a ratio of net debt to assets adjusted for the market
value of the Company’s fleet of vessels, to net interest expense ratio above a certain level, (ii) an amount of unencumbered cash above a certain level and, (iii) the Company’s trailing 12 months EBITDA to net interest expense ratio not to fall below a certain level. The loan was drawn down in full in five tranches
on January 13, 2022.
|
• |
the designation of the series;
|
• |
the number of shares of the series;
|
• |
the preferences and relative, participating, option or other special rights, if any, and any qualifications, limitations or restrictions of such series; and
|
• |
the voting rights, if any, of the holders of the series.
|
• |
not be redeemable;
|
• |
entitle holders to quarterly dividend payments in an amount per share equal to the aggregate per share amount of all cash dividends, and the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions
other than a dividend payable in our common shares or a subdivision of our outstanding common shares (by reclassification or otherwise), declared on our common shares since the immediately preceding quarterly dividend payment date; and
|
• |
entitle holders to one vote on all matters submitted to a vote of the shareholders of the Company.
|
Marshall Islands
|
Delaware
|
Shareholder Meetings
|
|
Held at a time and place as designated in the bylaws.
|
May be held at such time or place as designated in the certificate of incorporation or the bylaws, or if not so designated, as determined by the board of directors.
|
Special meetings of the shareholders may be called by the board of directors or by such person or persons as may be authorized by the articles of incorporation or by the bylaws.
|
Special meetings of the shareholders may be called by the board of directors or by such person or persons as may be authorized by the certificate of incorporation or by the bylaws.
|
May be held within or without the Marshall Islands.
|
May be held within or without Delaware.
|
Notice:
|
Notice:
|
Whenever shareholders are required to take any action at a meeting, written notice of the meeting shall be given which shall state the place, date and hour of the meeting and, unless it is an annual meeting,
indicate that it is being issued by or at the direction of the person calling the meeting. Notice of a special meeting shall also state the purpose for which the meeting is called.
|
Whenever shareholders are required to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and hour of the meeting, and the means of remote
communication, if any.
|
A copy of the notice of any meeting shall be given personally, sent by mail or by electronic mail not less than 15 nor more than 60 days before the meeting.
|
Written notice shall be given not less than 10 nor more than 60 days before the meeting.
|
Shareholders’ Voting Rights
|
|
Unless otherwise provided in the articles of incorporation, any action required to be taken at a meeting of shareholders may be taken without a meeting, without prior notice and without a vote, if a consent in
writing, setting forth the action so taken, is signed by all the shareholders entitled to vote with respect to the subject matter thereof, or if the articles of incorporation so provide, by the holders of outstanding shares having not less
than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
|
Any action required to be taken at a meeting of shareholders may be taken without a meeting if a consent for such action is in writing and is signed by shareholders having not fewer than the minimum number of
votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
|
Any person authorized to vote may authorize another person or persons to act for him by proxy.
|
Any person authorized to vote may authorize another person or persons to act for him by proxy.
|
Unless otherwise provided in the articles of incorporation or bylaws, a majority of shares entitled to vote constitutes a quorum. In no event shall a quorum consist of fewer than one-third of the shares
entitled to vote at a meeting.
However, where a company’s articles of incorporation provide for more than one vote on any share or matter, references to quorum shall refer to the number of votes entitled to be cast.
|
For stock corporations, the certificate of incorporation or bylaws may specify the number of shares required to constitute a quorum but in no event shall a quorum consist of less than one-third of shares entitled to vote at a meeting. In
the absence of such specifications, a majority of shares entitled to vote shall constitute a quorum.
However, where a company’s certificate of incorporation provides for more or less than one vote for any share or matter, references to quorum shall refer to the number of votes entitled to be cast.
|
When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders.
|
When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders.
|
The articles of incorporation may provide for cumulative voting in the election of directors.
|
The certificate of incorporation may provide for cumulative voting in the election of directors.
|
![]() |
STATEMENT OF DESIGNATIONS
OF
CASTOR MARITIME INC.
Reg. No. 92609
|
|
REPUBLIC OF THE MARSHALL ISLANDS
REGISTRAR OF CORPORATIONS
DUPLICATE COPY
The original of this Document was
|
FILED ON |
|
NON RESIDENT |
|
![]() |
|
March 30, 2022 |
|
![]() |
|
Tamara Hoffman |
|
Deputy Registrar |
|
|
![]() |
|
Petros Panagiotidis
|
|
President
|
|
|
|
![]() |
|
Dionysis Makris
|
|
Secretary
|
Dated: 27th April, 2021
|
|
LOAN AGREEMENT
|
for a secured floating interest rate loan facility of up to
US$18,000,000
|
|
CLAUSE
|
HEADINGS
|
PAGE
|
|
1.
|
PURPOSE, DEFINITIONS AND INTERPRETATION
|
1
|
|
2.
|
THE LOAN
|
21
|
|
3.
|
INTEREST
|
23
|
|
4.
|
REPAYMENT - PREPAYMENT
|
27
|
|
5.
|
PAYMENTS, TAXES AND COMPUTATION
|
30
|
|
6.
|
REPRESENTATIONS AND WARRANTIES
|
33
|
|
7.
|
CONDITIONS PRECEDENT
|
38
|
|
8.
|
COVENANTS
|
43
|
|
9.
|
EVENTS OF DEFAULT
|
56
|
|
10.
|
INDEMNITIES - EXPENSES - FEES
|
61
|
|
11.
|
SECURITY, APPLICATION, SET-OFF
|
67
|
|
12.
|
UNLAWFULNESS, INCREASED COST, BAIL-IN
|
69
|
|
13.
|
OPERATING ACCOUNTS
|
72
|
|
14.
|
ASSIGNMENT, TRANSFER, PARTICIPATION, LENDING OFFICE
|
74
|
|
15.
|
MISCELLANEOUS
|
76
|
|
16.
|
JOINT AND SEVERAL LIABILITY OF THE BORROWERS
|
79
|
|
17.
|
NOTICES AND COMMUNICATIONS
|
81
|
|
18.
|
LAW AND JURISDICTION
|
84
|
SCHEDULES
|
||
1.
|
Form of Drawdown Notice
|
|
2.
|
Form of Insurance Letter
|
(1) |
ALPHA BANK S.A., a banking
société anonyme incorporated in and pursuant to the laws of the Hellenic Republic with its head office at 40 Stadiou Street, Athens, Greece, acting, except as otherwise herein provided, through
its office at 93 Akti Miaouli, Piraeus, Greece, as lender (hereinafter called the “Lender”, which expression shall include its
successors and assigns); and
|
(2) | (a) | GAMORA SHIPPING CO., a corporation duly incorporated in the Republic of the Marshall Islands having its registered address at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (and includes its successors) (the “Gamora Borrower”); and |
(b) |
ROCKET SHIPPING CO., a corporation duly incorporated in the Republic of the Marshall Islands having its registered address at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (and includes its successors) (the “Rocket Borrower” and together with the Gamora Borrower hereinafter called the “Borrowers”)
|
1. |
PURPOSE, DEFINITIONS AND INTERPRETATION
|
1.1 |
Amount and Purpose
|
(a) |
Amount: This Agreement sets out the terms and conditions upon and subject to which it is agreed that the Lender will make available
to the Borrowers, on a joint and several basis, by one (1) Advance a secured term loan facility in the amount of up to the lesser of:
|
(i) |
Dollars Eighteen million ($18,000,000); and
|
(ii) |
60% of the aggregate Market Value of the Vessels as determined in
accordance with Clause 8.5(b) (Valuation of Vessels) by valuation obtained maximum twenty (20) days prior to the Drawdown Date;
|
(b) |
Purpose: The Loan proceeds shall be used for the purpose of re-financing part of the acquisition
cost of the Vessels.
|
1.2 |
Definitions
|
(a) |
the 30th day of April, 2021 or until such later date as the Lender may agree in writing; or
|
(b) |
such earlier date (if any): (i) on which the whole Commitment has been advanced by the Lender to the Borrowers, or (ii) on which the Commitment is reduced to zero pursuant to Clauses 3.6 (Market
disruption – Non Availability), 9.2 (Consequences of Default – Acceleration), 12.1 (Unlawfulness) or any other Clause of this
Agreement;
|
(a) |
in relation to an EEA Member Country which has implemented, or which at any time implements, Article 55 of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms, the
relevant implementing law or regulation as described in the EU Bail-In Legislation Schedule from time to time; and
|
(b) |
in relation to any other state, any analogous law or regulation from time to time which requires contractual recognition of any Write-down and Conversion Powers contained in that law or regulation;
|
(a) |
the agreements on capital requirements, 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;
|
(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; and
|
(c) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to Basel III;
|
(a) |
any claim by any governmental, judicial or regulatory authority which arises out of an Environmental Incident or which relates to any Environmental Law; or
|
(b) |
any claim by any other person which relates to an Environmental Incident,
|
(a) |
all losses, liabilities, costs, charges, expenses, damages and outgoings of whatever nature, (including, without limitation, Taxes, repair costs, registration fees and insurance premiums, crew wages, repatriation expenses and seamen’s
pension fund dues) suffered, incurred, charged to or paid or committed to be paid by the Lender in connection with the exercise of the powers referred to in or granted by any of the Finance Documents or otherwise payable by the Borrowers or
any of them in accordance with the terms of any of the Finance Documents;
|
(b) |
the expenses referred to in Clause 10.2 (Expenses); and
|
(c) |
interest on all such losses, liabilities, costs, charges, expenses, damages and outgoings from, in the case of Expenses referred to in sub-paragraph (b) above, the date on which such Expenses were demanded by the Lender from the Borrowers
and in all other cases, the date on which the same were suffered, incurred or paid by the Lender until the date of receipt or recovery thereof (whether before or after judgement) at the Default Rate (as conclusively certified by the Lender);
|
(a) |
sections 1471 to 1474 of the US Internal Revenue Code of 1986 (the “Code”) or any associated regulations or other associated official guidance;
|
(b) |
any treaty, law, regulation or other official guidance enacted in any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case)
facilitates the implementation of paragraph (a) above; or
|
(c) |
any agreement pursuant to the implementation of paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction;
|
(a) |
for principal, interest or any other sum payable in respect of any moneys borrowed or raised by the debtor;
|
(b) |
under any loan stock, bond, note or other security issued by the debtor;
|
(c) |
under any acceptance credit, guarantee or letter of credit facility made available to the debtor;
|
(d) |
under a financial lease, a deferred purchase consideration arrangement or any other agreement having the commercial effect of a borrowing or raising of money by the debtor;
|
(e) |
under any interest or currency swap or any other kind of derivative transaction entered into by the debtor or, if the agreement under which any such transaction is entered into requires netting of mutual liabilities, the liability of the
debtor for the net amount; or
|
(f) |
under a guarantee, indemnity or similar obligation entered into by the debtor in respect of a liability of another person which would fall within (a) to (e) if the references to the debtor referred to the other person;
|
(a) |
“The International Management Code for the Safe Operation of Ships and for Pollution Prevention”, currently known or referred to as the “ISM Code”, adopted by the Assembly of the International Maritime Organisation by Resolution A. 741(18) on 4th November, 1993 and incorporated on 19th May, 1994 into chapter IX of the
International Convention for the Safety of Life at Sea 1974 (SOLAS 1974); and
|
(b) |
all further resolutions, circulars, codes, guidelines, regulations and recommendations which are now or in the future issued by or on behalf of the International Maritime Organisation or any other entity with responsibility for
implementing the ISM Code, including without limitation, the “Guidelines on implementation or administering of the International Safety Management (ISM) Code by Administrations” produced by the
International Maritime Organisation pursuant to Resolution A. 788(19) adopted on 25th November, 1995;
|
(a) |
the DOC and SMC issued by a classification society in all respects acceptable to the Lender in its absolute discretion pursuant to the ISM Code in relation to the Vessels within the period specified by the ISM Code;
|
(b) |
all other documents and data which are relevant to the ISM SMS and its implementation and verification which the Lender may require by request; and
|
(c) |
any other documents which are prepared or which are otherwise relevant to establish and maintain each Vessel’s or each Owner’s compliance with the ISM Code which the Lender may require by request;
|
(a) |
the applicable Screen Rate at or about 11.45 a.m. (London time) on the Quotation Day for Dollars and for a period equal in length to the Interest Period then
applicable to the Loan or that part of the Loan; or
|
(b) |
as otherwise determined pursuant to Clause3.6(d) (Negotiation of alternative rate of interest),
|
(a) |
the business, property, assets, liabilities, operations or condition (financial or otherwise) of the Borrower and/or any Security Party taken as a whole;
|
(b) |
the ability of the Borrower and/or any Security Party to (i) comply with or perform any of its obligations or (ii) discharge any of its liabilities, under any Finance Document as they fall due; or
|
(c) |
the validity, legality or enforceability of any Finance Document or the rights and remedies of the Lender under any Finance Document;
|
(a) |
Security Interests created by the Finance Documents;
|
(b) |
liens for unpaid crew’s wages in accordance with usual maritime practice;
|
(c) |
liens for salvage;
|
(d) |
liens arising by operation of law for not more than 2 months’ prepaid hire under any charter in relation to such Vessel not prohibited by this Agreement;
|
(e) |
liens for master’s disbursements incurred in the ordinary course of trading and any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of a
Vessel, provided such liens do not secure amounts more than 60 days overdue (unless the overdue amount is being contested in good faith by appropriate steps) and, in the case of liens for repair or maintenance, in such Vessel is put in the
possession of any person for the purpose of work being done upon her in an amount exceeding or likely to exceed the Major Casualty Amount provided that (i) either that person has first given to the Lender and in terms satisfactory to
it a written undertaking not to exercise any lien on such Vessel or her earnings for the cost of such work or (ii) the previous consent of the Lender shall have been obtained (which consent shall not be unreasonably withheld);
|
(f) |
any Security Interest created in favour of a plaintiff or defendant in any action of the court or tribunal before whom such action is brought as security for costs and expenses where the Owner is prosecuting or
defending such action in good faith by appropriate steps; and
|
(g) |
Security Interests arising by operation of law in respect of taxes which are not overdue for payment other than taxes being contested in good faith by appropriate steps and in respect of which appropriate
reserves have been made;
|
(a) |
formally designated, nominated or recommended as the replacement for a Screen Rate by:
|
(i) |
the administrator of that Screen Rate (provided that the market or economic reality that such benchmark rate measures is the same as that measured by that Screen Rate); or
|
(ii) |
any Relevant Nominating Body,
|
(b) |
in the opinion of the Lender and the Borrower, generally accepted in the international loan markets as the appropriate successor to a Screen Rate; or
|
(c) |
in the opinion of the Lender and the Borrower, an appropriate successor to a Screen Rate;
|
(a) |
the government of the United States of America;
|
(b) |
the United Nations;
|
(c) |
the European Union (or the governments of any of its member states);
|
(d) |
the United Kingdom;
|
(e) |
the Flag State; or
|
(f) |
the respective governmental institutions and agencies of any of the foregoing including the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”), the
United States Department of State, the United States Department of Commerce and Her Majesty’s Treasury;
|
(a) |
that is, or is directly or indirectly, owned or controlled (as such terms are defined by the relevant Sanctions Authority) by, or acting on behalf of, one or more persons or entities on any list (each as amended, supplemented or
substituted from time to time) of restricted entities, persons or organisations (or equivalent) published by a Sanctions Authority;
|
(b) |
that is located or resident in or incorporated under the laws of, or owned or controlled by, a person located or resident in or incorporated under the laws of a Sanctions Restricted Jurisdiction; or
|
(c) |
that is otherwise the target or subject of Sanctions;
|
(a) |
the methodology, formula or other means of determining that Screen Rate has, in the opinion of the Lender and the Borrowers, materially changed;
|
(b) |
(i)
|
(A) |
the administrator of that Screen Rate or its supervisor publicly announces that such administrator is insolvent; or
|
(B) |
information is published in any order, decree, notice, petition or filing, however described, or filed with a court, tribunal, exchange, regulatory authority or similar administrative, regulatory or judicial body which reasonably confirms
that the administrator of that Screen Rate is insolvent,
|
(ii) |
the administrator of that Screen Rate publicly announces that it has ceased or will cease, to provide that Screen Rate permanently or indefinitely and, at that time, there is no successor administrator to continue to provide that Screen
Rate;
|
(iii) |
the supervisor of the administrator of that Screen Rate publicly announces that such Screen Rate has been or will be permanently or indefinitely discontinued; or
|
(iv) |
the administrator of that Screen Rate or its supervisor announces that that Screen Rate may no longer be used; or
|
(v) |
in the opinion of the Lender and the Borrowers, that Screen Rate is otherwise no longer appropriate for the purposes of calculating interest under this Agreement;
|
(a) |
the Accounts Pledge Agreement;
|
(b) |
the Approved Manager’s Undertakings;
|
(c) |
the General Assignments;
|
(d) |
the Mortgages;
|
(e) |
any Charterparty Assignment;
|
(f) |
the Corporate Guarantee;
|
(g) |
the Shares Pledge Agreement; and
|
(h) |
any other agreement or document (whether creating a Security
Interest or not) that may have been or shall from time to time after the date of this Agreement be executed to guarantee and/or secure all or any part of the Outstanding Indebtedness and/or any and all
other obligations of the Borrowers to the Lender pursuant to this Agreement and any other moneys from time to time owing or payable by the Borrowers under or in connection with this Agreement and/or any of the other documents referred to
in this definition, as each such document may from time to time be amended and/or supplemented, and “Security Document” means any of them as the context may require;
|
(a)
|
actual, constructive, compromised or arranged total loss of that Vessel; or
|
(b) |
any expropriation, confiscation, appropriation, expropriation, deprivation, forfeiture, requisition or acquisition of that Vessel, whether for full or part consideration, a consideration less than its proper value, a nominal consideration
or without any consideration, which is effected by any Government Entity or by any person or persons claiming to be or to represent a Government Entity whether de jure or de facto, unless it is within thirty (30) days from the date of such
occurrence redelivered to the full control of the Owner thereof; or
|
(c) |
any condemnation of that Vessel
by any tribunal or by any person or persons claiming to be a tribunal,
|
(d) |
any arrest, capture, seizure, confiscation or detention of that Vessel (including any hijacking or theft or piracy or related incident) unless it is
within ninety (90) days from the date of such occurrence redelivered to the full control of the Owner thereof;
|
“Total Loss Date” means, in
relation to a Vessel:
|
(a) |
in the case of an actual loss of that Vessel, the date on which it occurred or, if that is unknown, the date when that Vessel was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of that Vessel, the earliest of:
|
(i) |
the date on which a notice of abandonment is given to the insurers; and
|
(ii) |
the date of any compromise, arrangement or agreement made by or on behalf of the Owner of that Vessel with that Vessel’s insurers in which the insurers
agree to treat that Vessel as a total loss;
|
(a) |
a Borrower which is resident for tax purposes in the US; or
|
(b) |
a Borrower or a Security Party some or all whose payments under the Finance Documents are from sources within the US for US federal income tax purposes;
|
(a) |
the oil tanker motor vessel “WONDER SIRIUS“, of about 62,806 gt and 34,551 nt, built in 2005 in Geoje, S. Korea by Samsung Heavy Industries Co. Ltd., having IMO No. 9285847, registered under the laws and flag of the Republic of the Marshall Islands at the Ships Registry of the port of Majuro in the ownership of the Gamora Borrower with Official No. 9332 (the “Vessel A”); and
|
(b) |
the oil tanker motor vessel “WONDER POLARIS“, of about 62,806 gt and 34,551 nt, built in 2005 in Geoje, S. Korea by Samsung Heavy Industries Co. Ltd., having IMO No. 9285835, registered under the laws and flag of the Republic of the Marshall Islands at the Ships Registry of the port of Majuro in the ownership of the Rocket Borrower with Official No. 9331 (the “Vessel B”),
|
(a) |
in relation to any Bail-In Legislation described in the EU Bail-In Legislation Schedule from time to time, the powers described as such in relation to that Bail-In Legislation in the EU Bail-In Legislation Schedule; and
|
(b) |
in relation to any other applicable Bail-In Legislation:
|
(i) |
any powers under that Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to
cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any
other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are
related to or ancillary to any of those powers; and
|
(ii) |
any similar or analogous powers under that Bail-In Legislation; and
|
(c) |
in relation to any UK Bail-In Legislation:
|
(i) |
any powers under that UK Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or Affiliate of a bank, investment firm or other financial institution,
to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or
any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that UK Bail-In Legislation
that are related to or ancillary to any of those powers; and
|
(ii) |
any similar or analogous powers under that UK Bail-In Legislation.
|
1.3 |
Interpretation
|
(c) |
Clause headings and the table of contents are inserted for convenience of reference only and shall be ignored in the interpretation of this Agreement;
|
(d) |
subject to any specific provision of this Agreement or of any assignment and/or participation or syndication agreement of any nature whatsoever, reference to each of the parties hereto and to the other Finance Documents shall be deemed to
be reference to and/or to include, as appropriate, their respective successors and permitted assigns;
|
(e) |
where the context so admits, words in the singular include the plural and vice versa;
|
(f) |
the words “including” and “in particular” shall not be construed as limiting the generality of any foregoing words;
|
(g) |
references to (or to any specified provisions of) 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, whether before the date of this Agreement or otherwise;
|
(h) |
references to Clauses and Schedules are to be construed as references to the Clauses of, and the Schedules to, the relevant Finance Document and references to a Finance Document include all the terms of that Finance Document and any
Schedules, Annexes or Appendices thereto, which form an integral part of same;
|
(i) |
references to the opinion of the Lender or a determination or acceptance by the Lender or to documents, acts, or persons acceptable or satisfactory to the Lender or the like shall be construed as reference to opinion, determination,
acceptance or satisfaction of the Lender at the sole discretion of the Lender, and such opinion, determination, acceptance or satisfaction of the Lender shall be conclusive and binding on the Borrowers;
|
(j) |
references to a “regulation” include any present or future regulation, rule, directive,
requirement, request or guideline (whether or not having the force of law) of any governmental or intergovernmental body, agency, authority, central bank or government department or any self-regulatory or other national or supra-national
authority or organisation and includes (without limitation) any Basel II Regulation or Basel III Regulation;
|
(k) |
references to any person include such person’s assignees and successors in title; and
|
(l) |
references to or to a provision of, any law include any amendment, extension, re-enactment or replacement, whether made before the date of this Agreement or otherwise;
|
1.4 |
Construction of certain terms
|
(a) |
the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to:
|
(i) |
cast, or control the casting of, more than 50 per cent of the maximum number of votes that might be cast at a general meeting of that entity; or
|
(ii) |
appoint or remove all, or the majority, of the directors or other equivalent officers of that entity; or
|
(iii) |
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 per cent of the issued share capital of that entity (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either
profits or capital) (and, for this purpose, any Security Interest over the share capital shall be disregarded in determining the beneficial ownership of such share capital);
|
1.5 |
Same meaning
|
1.6 |
Inconsistency
|
1.7 |
Finance Documents
|
2. |
THE LOAN
|
2.1 |
Commitment to lend
|
2.2 |
Drawdown Notice irrevocable
|
2.3 |
Drawdown Notice and commitment to borrow
|
2.4 |
Number of advances agreed
|
2.5 |
Disbursement
|
2.6 |
Application of proceeds
|
2.7 |
Termination date of the Commitment
|
2.8 |
Evidence
|
2.9 |
Cancellation
|
2.10 |
No security or lien from other person
|
2.11 |
Interest to co-borrow
|
3. | INTEREST |
3.1 |
Normal Interest Rate
|
3.2 |
Selection of Interest Period
|
(a) |
Notice: The Borrowers may by notice received by the Lender not later than 10:00 a.m. (London time) on the second Banking Day before
the beginning of each Interest Period specify (subject to Clause 3.3 (Determination of Interest Periods) below) whether such Interest Period shall have a duration of one (1) or two (2) or
three (3) months (or such other period as may be requested by the Borrowers and as the Lender, in its sole discretion, may agree to).
|
(b) |
Non-availability of matching deposits for Interest Period selected: If, after the Borrowers by notice to the Lender have selected
an Interest Period, the Lender notifies the Borrowers on the same Banking Day before the commencement of that Interest Period that it is not satisfied that deposits in Dollars for a period equal to that Interest Period will be available to
it in the London Interbank Market when that Interest Period commences, that Interest Period shall be of such duration as the Lender may advise the Borrowers in writing.
|
3.3 |
Determination of Interest Periods
|
(a) |
Initial Interest Period: the initial Interest Period in respect of the Loan will commence on the date on which the Commitment is
advanced and each subsequent Interest Period will commence forthwith upon the expiry of the preceding Interest Period;
|
(b) |
Interest tranches: if any Interest Period would otherwise overrun one or more Repayment Dates, then, in the case of the last
Repayment Date, such Interest Period shall end on such Repayment Date, and in the case of any other Repayment Date or Dates the Loan shall be divided into parts so that there is one part equal to the amount(s) of the Repayment Instalment(s)
due on each Repayment Date falling during that Interest Period and having an Interest Period ending on the relevant Repayment Date and another part equal to the amount of the balance of the Loan having an Interest Period determined in
accordance with Clause 3.2 (Selection of Interest Period) and the other provisions of this Clause 3.3 and the other provisions of this Clause 3.3 and the expression “Interest Period in respect of the Loan” when used in this Agreement refers to the Interest Period in respect of the
balance of the Loan;
|
(c) |
Failure to notify: if the Borrowers fail to specify the duration of an Interest Period in accordance with the provisions of Clause
3.2 (Selection of Interest Period) and this Clause 3.3, such Interest Period shall have a duration of three (3) months unless another period shall be determined by the Lender at its sole
discretion provided, always, that such period (whether of three (3) months or of different duration) shall comply with this Clause 3.3,
|
(i) |
any Interest Period which commences on the last day of a calendar month, and any Interest Period which commences on the day on which there is no numerically corresponding day in the calendar month during which such Interest Period is due
to end, shall end on the last Banking Day of the calendar month during which such Interest Period is due to end; and
|
(ii) |
if the last day of an Interest Period is not a Banking Day the Interest Period shall be extended until the next following Banking Day unless such next following Banking Day falls in the next calendar month in which case such Interest
Period shall be shortened to expire on the preceding Banking Day.
|
3.4 |
Default Interest
|
(a) |
Default interest: If the Borrowers fail to pay any sum (including, without limitation, any sum payable pursuant to this Clause 3.4)
on its due date for payment under any of the Finance Documents, the Borrowers shall pay interest on such sum from the due date up to the date of actual payment (as well after as before judgement) at the rate determined by the Lender
pursuant to this Clause 3.4. The period beginning on such due date and ending on such date of payment shall be divided into successive periods as selected by the Lender each of which (other than the first, which shall commence on such due
date) shall commence on the last day of the preceding such period. The rate of interest applicable to each such period shall be the aggregate (as determined by the Lender) of (i) two per cent (2%) per annum, (ii) the Margin and (iii)
LIBOR. Such interest shall be due and payable on the last day of each such period as determined by the Lender and each such day shall, for the purposes of this Agreement, be treated as an Interest Payment Date, provided that if such
unpaid sum is of principal which became due and payable by reason of a declaration by the Lender under Clause 9.2 (Consequences of Default – Acceleration) or a prepayment pursuant to Clauses
4.2 (Voluntary Prepayment), 4.3 (Compulsory Prepayment in case of Total Loss or sale of a Vessel), 8.5(a)(i), 12.1 (Unlawfulness) and 12.2 (Increased Cost) on a date other than an Interest Payment Date relating thereto, the first such period selected by the Lender shall be of a duration equal to the period between the
due date of such principal sum and such Interest Payment Date and interest shall be payable on such principal sum during such period at a rate two per cent (2%) above the rate applicable thereto immediately before it fell due. If for the
reasons specified in Clause 3.6 (Market disruption – Non Availability), the Lender is unable to determine a rate in accordance with the foregoing provisions of this Clause 3.4, interest on
any sum not paid on its due date for payment shall be calculated at a rate determined by the Lender to be two per cent (2%) per annum above the aggregate of (i) the Margin and (ii) the Alternative Rate.
|
(b) |
Compounding of default interest: Any such interest which is not paid at the end of the period by reference to which it was
determined shall be compounded every 6 months and shall be payable on demand.
|
3.5 |
Notification of Interest and interest rate
|
3.6 |
Market disruption – Non Availability
|
(a) |
Market Disruption Event - Notification: If and whenever, at any time prior to the commencement of any Interest Period, the Lender
(in its discretion) shall have determined (which determination shall be conclusive in the absence of manifest error) that a Market Disruption Event has occurred in relation to the Loan for any such Interest Period, then the Lender shall
forthwith give notice thereof (a “Determination Notice”) to the Borrowers stating the circumstances falling within Clause 3.6(c) (Meaning of “Market Disruption Event”) which have caused its notice to be given and the rate of interest on the Loan (or the relevant
part thereof) for that Interest Period shall be the percentage rate per annum which is the sum of:
|
(ii) |
the rate which expresses as a percentage rate per annum the cost to the Lender of funding the Loan (or the relevant part thereof) from whatever source it may select.
|
(b) |
Suspension of drawdown: If the Determination Notice is given before the Commitment (or a part thereof) is advanced, the Lender’s
obligation to make the Commitment (or a part thereof) available shall be suspended while the circumstances referred to in the Determination notice continue.
|
(c) |
Meaning of “Market Disruption Event”: In this Agreement “Market
Disruption Event” means:
|
(i) |
at or about noon on the Quotation Day for the relevant Interest Period no Screen Rate is available for LIBOR for Dollars; and/or
|
(ii) |
before close of business in London on the Quotation Day for the relevant Interest Period, the Lender determines (in its sole discretion) that the cost to it of obtaining matching deposits in the London
Interbank Market to fund the Loan (or the relevant part thereof) for such Interest Period would be in excess of the Screen Rate for such Interest Period; and
|
(iii) |
before close of business in London on the Quotation Day for the relevant Interest Period, deposits in Dollars are not available to the Lender in the London Interbank Market in the ordinary course of business in
sufficient amounts to fund the Loan (or the relevant part thereof) for such Interest Period.
|
(d) |
Negotiation of alternative rate of interest: If the Determination Notice is served after the Loan is borrowed, the
Borrower and the Lender shall enter into negotiations (for a period of not more than 15 days after the date on which the Lender serves the Determination Notice (the “Negotiation Period”)
and shall use reasonable endeavours to agree, an alternative interest rate or (as the case may be) an alternative basis for the Lender to fund or continue to fund the Loan during the Interest Period concerned. During the Negotiation Period
the Lender shall set an Interest Period and interest rate representing the Cost of Funding of the Lender in Dollars, in each case as determined by the Lender, of the Loan plus the Margin.
|
(e) |
Application of agreed alternative rate of interest: Any alternative interest
rate or an alternative basis which is agreed during the Negotiation Period shall be binding on the Lender and all Security Parties and shall take effect in accordance with the terms agreed.
|
(d) |
Alternative basis of interest in absence of agreement: If the Lender and the Borrowers will not enter into negotiations as provided in Clause 3.6(c)(i) or if an alternative interest rate or alternative basis is not agreed within the Negotiation
Period, and the relevant circumstances are continuing at the end of the Negotiation Period, then the Lender shall set the following Interest Period and an interest rate representing the cost of funding of the Lender in Dollars of the Loan (or the relevant part thereof) plus the Margin for such Interest Period; if the relevant circumstances are continuing at the end of the Interest Period so set by the Lender and the Borrowers and the Lender are unable to agree a suitable alternative basis, the Lender shall continue to set the following Interest Period and an interest rate representing its cost of funding in
Dollars of the Loan (or the relevant part thereof) plus the Margin for such Interest Period until such time as the circumstances specified in Sub-Clause 3.6(a)
(Market Disruption Event) shall no longer exist, whereupon the normal rate of interest shall apply.
|
(e) |
Notice of prepayment: If the Borrowers do not
agree with an interest rate set by the Lender under Clause 3.6(d) (Alternative basis of interest in absence of agreement), the Borrowers may give the Lender not less than 5 Banking Days’ notice of its intention to prepay the Loan at the end of the interest period set by the Lender.
|
(f) |
Prepayment; termination of Commitment: A notice under Clause 3.6(e) (Notice of prepayment) shall be irrevocable; and on the last Banking Day of the interest period set by the Lender, the Borrowers, if the Commitment has already been advanced, shall prepay (without premium or penalty) the Loan, together with accrued interest thereon at the
applicable rate plus the Margin and the balance of the Outstanding Indebtedness or, if the Commitment has not been advanced, the Commitment shall be reduced to zero and no Advance shall be made to the Borrowers under this Agreement
thereafter.
|
(g) |
Application of prepayment: The provisions of Clause 4 (Repayment-Prepayment) shall
apply in relation to the prepayment made hereunder.
|
(a) |
If a Screen Rate Replacement Event has occurred in relation to the Screen Rate for dollars, any amendment or waiver which relates to:
|
(i) |
providing for the use of a Replacement Benchmark in relation to that currency in place of that Screen Rate ; and
|
(1) |
aligning any provision of any Finance Document to the use of that Replacement Benchmark;
|
(2) |
enabling that Replacement Benchmark to be used for the calculation of interest under this Agreement (including, without limitation, any consequential changes required to enable that Replacement Benchmark to be
used for the purposes of this Agreement);
|
(3) |
implementing market conventions applicable to that Replacement Benchmark;
|
(4) |
providing for appropriate fallback (and market disruption) provisions for that Replacement Benchmark; or
|
(5) |
adjusting the pricing to reduce or eliminate, to the extent reasonably practicable, any transfer of economic value from one Party to another as a result of the application of that Replacement Benchmark (and if
any adjustment or method for calculating any adjustment has been formally designated, nominated or recommended by the Relevant Nominating Body, the adjustment shall be determined on the basis of that designation, nomination or
recommendation),
|
4. |
REPAYMENT - PREPAYMENT
|
4.1 |
Repayment
|
(a) |
1st to 4th (both incl.) in the amount of Dollars Eight hundred fifty thousand
($850,000); and
|
(a) |
5th to 16th (both incl.) in the amount of Dollars Six hundred seventy five
thousand ($675,000);
|
4.2 |
Voluntary Prepayment
|
(a) |
the Lender shall have received from the Borrowers not less than five (5) days’ prior notice in writing (which shall be irrevocable) of their intention to make such prepayment and specify the account and the date on which such prepayment is
to be made;
|
(b) |
such prepayment may take place only on the last day of an Interest Period relating to the whole of the Loan;
|
(c) |
each such prepayment shall be equal to One hundred thousand Dollars ($100,000) or a whole multiple thereof or the balance of the Loan;
|
(d) |
any prepayment of less than the whole of the Loan will be applied in or towards pro-rata satisfaction of the outstanding Repayment Installments and the Balloon Installment;
|
(e) |
every notice of prepayment shall be effective only on actual receipt by the Lender, shall be irrevocable and shall oblige the Borrowers to make such prepayment on the date specified;
|
(f) |
the Borrowers have provided evidence satisfactory to the Lender that any consent required by the Borrowers (or any of them) or any Security Party in connection with the prepayment has been obtained and remains in force, and that any
regulation relevant to this Agreement which affects the Borrowers (or any of them) or any Security Party has been complied with;
|
(g) |
no amount prepaid may be re-borrowed; and
|
(h) |
the Borrowers may not prepay the Loan or any part thereof save as expressly provided in this Agreement;
|
4.3 |
Compulsory Prepayment in case of Total Loss or sale of a Vessel
|
(a) |
Total Loss of a Vessel: On a Vessel becoming a Total Loss:
|
(i) |
prior to the advancing of the Commitment, the obligation of the Lender to make available the Commitment shall immediately cease and the Commitment shall be reduced to zero; or
|
(ii) |
in case the Commitment or, as the case may be, any part thereof has been already advanced, the amount of the Loan shall, on on the earlier of the date falling one hundred and twenty (120) days after the Total Loss Date and the date of
receipt by the Lender of the insurance proceeds relating to such Total Loss, be reduced by an amount equal to the Relevant Percentage (as hereinafter defined) of the Loan and the Borrowers shall thereupon be obliged to make such
repayment of the Relevant Percentage of the Loan.
|
(b) |
Sale or refinancing of a Mortgaged Vessel: In the event of a sale or other disposal of any
Mortgaged Vessel or in case of refinancing of a Mortgaged Vessel by another bank or financial institution or if the Borrowers request the Lender’s consent for the discharge of the Mortgage
registered on a Mortgaged Vessel the amount of the Loan shall be reduced by an amount equal to the Relevant Percentage (as hereinafter defined) and the Borrowers shall thereupon be obliged to make such repayment of the
Relevant Percentage of the Loan;
|
(i) |
an amount equal to the proportion which the Market Value of such Mortgaged Vessel bears to the aggregate of the Market Values of both Mortgaged Vessels based on the valuations of such Vessels carried out under Clause 8.5(b) (Valuation of Vessels) immediately before the Total Loss occurred or the sale or other disposal of the relevant Mortgaged Vessel, as the case may be occurs; and
|
(ii) |
the amount which is required to be repaid to the Lender so that, after the payment to the Lender of the amount referred to in paragraph (i), the aggregate of (1) the Market Value of the Vessel remaining mortgaged to the Lender determined
in accordance with Clause 8.5(b) (Valuation of Vessels) immediately after the Total Loss or the sale or other disposal of the relevant Vessel, as the case may be, and (2) the Pledged Deposit
is at least equal to 120% of the amount of the Loan;
|
4.4 |
Application by the Lender in case of compulsory prepayment
|
4.5 |
Amounts payable on prepayment
|
(a) |
accrued interest on the amount of the Loan to the date of such prepayment (calculated, in the case of a prepayment pursuant to Clause 3.6 (Market disruption – Non Availability) at a rate
equal to the aggregate of the Margin and the cost to the Lender of funding the Loan);
|
(b) |
any additional amount payable under Clause 5.3 (Gross Up);
|
(c) |
all other sums payable by the Borrowers to the Lender under this Agreement or any of the other Finance Documents including, without limitation, any amounts payable under Clause 10 (Indemnities -
Expenses – Fees); and
|
(d) |
in relation to any prepayment made on a date other than an Interest Payment Date in respect of the whole of the Loan, it shall, in addition to the amount prepaid and accrued interest, pay to the Lender any
amount which the Lender may certify is necessary to compensate the Lender for any Break Costs incurred by the Lender as a result of the making of the prepayment in question.
|
5. |
PAYMENTS, TAXES AND COMPUTATION
|
5.1 |
Payment - No set-off or Counterclaims
|
(a) |
The Borrowers hereby jointly and severally acknowledge that in performing their respective obligations under this Agreement, the Lender will be incurring liabilities to third parties in relation to the funding of amounts to the Borrowers,
such liabilities matching the liabilities of the Borrowers to the Lender and that it is reasonable for the Lender to be entitled to receive payments from the Borrowers gross on the due date in order that the Lender is put in a position to
perform its matching obligations to the relevant third parties. Accordingly, all payments to be made by the Borrowers under this Agreement and/or any of the other Finance Documents shall be made in full, without any set-off or counterclaim
whatsoever and, subject as provided in Clause 5.3 (Gross Up), free and clear of any deductions or withholdings or Governmental Withholdings whatsoever, as follows:
|
(i) |
in Dollars (except for charges or expenses which shall be paid in the currency in which they are incurred), not later than 10:00 a.m. (London time) on the Banking Day (in Piraeus, Athens, London and New York City) on which the relevant
payment is due under the terms of this Agreement; and
|
(ii) |
to such account and at such bank as the Lender may from time to time specify for this purpose by written notice to the
Borrowers, reference: “Gamora Shipping Co./Rocket Shipping Co./Loan Agreement dated: 27th April, 2021” provided, however, that the Lender shall have the right to change the place of account for payment, upon three (3) Banking Days’ prior written notice to the Borrowers.
|
(b) |
If at any time it shall become unlawful or impracticable for the Borrowers (or any of them) to make payment under this Agreement to the relevant account or bank referred to in Clause 5.1(a), the Borrowers may request and the Lender may
agree to alternative arrangements for the payment of the amounts due by the Borrowers to the Lender under this Agreement or the other Finance Documents.
|
5.2 |
Payments on Banking Days
|
5.3 |
Gross Up
|
5.4 |
Mitigation
|
(a) |
have an adverse effect on its business, operations or financial condition on the Lender; or
|
(b) |
involve it in any activity which is unlawful or prohibited or any activity that is contrary to, or inconsistent, with any regulation of the Lender; or
|
(c) |
involve the Lender in any expense (unless indemnified to its reasonable satisfaction) or tax disadvantage.
|
5.5 |
Claw-back of Tax benefit
|
(a) |
the Lender shall not be obliged to allocate this transaction any part of a tax repayment or credit which is referable to a number of transactions;
|
(b) |
nothing in this Clause shall oblige the Lender to rearrange its tax affairs in any particular manner, to claim any type of relief, credit, allowance or deduction instead of, or in priority to, another or to
make any such claim within any particular time or to disclose any information regarding its tax affairs and computations;
|
(c) |
nothing in this Clause shall oblige the Lender to make a payment which exceeds any repayment or credit in respect of tax on account of which the Borrower has made an increased payment under this Clause;
|
(d) |
any allocation or determination made by the Lender under or in connection with this Clause shall be binding on the Borrower; and
|
(e) |
without prejudice to the generality of the foregoing, the Borrower shall not, by virtue of this Clause 5.5, be entitled to enquire about the Lender’s tax affairs.
|
5.6 |
Loan Account
|
5.7 |
Computation
|
6. |
REPRESENTATIONS AND WARRANTIES
|
6.1 |
Continuing representations and warranties
|
(a) |
Due Incorporation/Valid Existence: Each of the Borrowers and the other corporate Security Parties is duly incorporated and validly
existing and in good standing under the laws of their respective countries of incorporation, and have power to own their respective property and assets, to carry on their respective business as the same are now being lawfully conducted and
to purchase, own, finance and operate vessels, or, as the case may be, manage vessels, as well as to undertake the obligations which such Security Party has undertaken or shall undertake pursuant to the Finance Documents and does not have a
place of business in the United Kingdom or the United States of America;
|
(b) |
Due Corporate Authority: Each of the Borrowers has power to execute, deliver and perform its obligations under the Finance
Documents to which is or is to be a party and to borrow the Commitment and each of the other Security Parties has power to execute and deliver and perform its/his obligations under the Finance Documents to which it/he is or is to be a
party; all necessary corporate, shareholder and other action has been taken to authorise the execution, delivery and performance of the same and no limitation on the powers of the Borrowers (or any of them) to borrow will be exceeded as a
result of borrowing the Loan;
|
(c) |
Litigation: no litigation or arbitration, tax claim or administrative proceeding (including action relating to any alleged or actual
breach of the ISM Code and the ISPS Code) involving a potential liability of the Borrowers (or any of them) or any other Security Party is current or pending or (to its or its officers’ knowledge) threatened against the Borrowers (or any of
them) or any other Security Party, which, if adversely determined, would have a Material Adverse Effect of any of them;
|
(d) |
No conflict with other obligations: the execution and delivery of, the performance of its obligations under, and compliance with
the provisions of, the Finance Documents by the relevant Security Parties will not (i) contravene any existing applicable law, statute, rule or regulation or any judgment, decree or permit to which the Borrowers (or any of them) or any
other Security Party is subject, (ii) conflict with, or result in any breach of any of the terms of, or constitute a default under, any agreement or other instrument to which the Borrowers (or any of them) or any other Security Party is a
party or is subject to or by which it or any of its property is bound, (iii) contravene or conflict with any provision of the memorandum and articles of association/articles of incorporation/by-laws/statutes or other constitutional
documents of the Borrowers (or any of them) or any other Security Party or (iv) result in the creation or imposition of or oblige the Borrowers (or any of them) or any other Security Party to create any Security Interest (other than a
Permitted Security Interest) on any of the undertakings, assets, rights or revenues of the Borrowers (or any of them) or any other Security Party;
|
(e) |
Financial Condition: the financial condition of the Borrowers (or any of them) and of the other Security Parties (other than the
Approved Managers) has not suffered any material deterioration since that condition was last disclosed to the Lender;
|
(f) |
No Immunity: neither the Borrowers nor any other Security Party nor any of their respective assets are entitled to immunity on the
grounds of sovereignty or otherwise from any legal action or proceeding (which shall include, without limitation, suit, attachment prior to judgement, execution or other enforcement);
|
(g) |
Shipping Company: each of the Borrowers and the Approved Managers is a shipping company involved in the owning or, as the case may
be, managing of ships engaged in international voyages and earning profits in free foreign currency;
|
(h) |
Licences/Authorisation: every consent, authorisation, license or approval of, or registration with or declaration to, governmental
or public bodies or authorities or courts required by any Security Party to authorise, or required by any Security Party in connection with, the execution, delivery, validity, enforceability or admissibility in evidence of each of the
Finance Documents or the performance by each Security Party of its obligations under the Finance Documents to which such Security Party is or is to be a party has been obtained or made and is in full force and effect and there has been no
default in the observance of any of the conditions or restrictions (if any) imposed in, or in connection with, any of the same so far as the Borrowers are aware;
|
(i) |
Perfected Securities: the Finance Documents do now or, as the case may be, will, upon execution and delivery (and,
where applicable, registration as provided for in the Finance Documents):
|
(i) |
constitute the relevant Security Party’s legal, valid and binding obligations enforceable against that Security Party in accordance with their respective terms (having the requisite corporate benefit which is
legally and economically sufficient); and
|
(ii) |
create legal, valid and binding Security Interests (having the priority specified in the relevant Finance Document) enforceable in accordance with their respective terms over all the assets and revenues
intended to be covered to which they, by their terms, relate, subject to any relevant insolvency laws affecting creditors’ rights generally;
|
(m) |
No third party Security Interests: without limiting the generality of Clause
6.1(i) (Perfected Securities), at the time of the execution and delivery of each Finance Document to which each Borrower is a party:
|
(i) |
each Borrower will have the right to create all the Security Interests which that Finance Document purports to create; and
|
(ii) |
no third party will have any Security Interests (except for Permitted Security Interests) or any other interest, right or claim over, in or in relation to any asset to which any such Security Interest, by its
terms, relates;
|
(n) |
No Notarisation/Filing/Recording: save for the registration of any Mortgage in the appropriate
shipping Registry, it is not necessary to ensure the legality, validity, enforceability or admissibility in evidence of this Agreement or any of the other Finance Documents that it or they or any other instrument be notarised, filed,
recorded, registered or enrolled in any court, public office or elsewhere or that any stamp, registration or similar tax or charge be paid on or in relation to this Agreement or the other Finance Documents;
|
(o) |
Taxes paid: each Borrower has paid all taxes applicable to, or imposed on or
in relation to that Borrower, its business or its Vessel; and
|
(p) |
Valid Choice of Law: the choice of law agreed to govern this Agreement and/or any other Finance Document and the submission to the
jurisdiction of the courts agreed in each of the Finance Documents are or will be, on execution of the respective Finance Documents, valid and binding on each of the Borrowers and any other Security Party which is or is to be a party
thereto.
|
6.2 |
Initial representations and warranties
|
(a) |
Direct obligations - Pari Passu: the obligations of the Borrowers under this Agreement are direct, general and unconditional
obligations of the Borrowers and rank at least pari passu with all other present and future unsecured and unsubordinated Financial Indebtedness of the Borrowers with the exception of any obligations which are mandatorily preferred by law;
|
(b) |
Information: all information, accounts, statements of financial position, exhibits and reports furnished by or on behalf of any
Security Party to the Lender in connection with the negotiation and preparation of this Agreement and each of the other Finance Documents are true and accurate in all material respects and not misleading, do not omit material facts and all
reasonable enquiries have been made to verify the facts and statements contained therein; there are no other facts the omission of which would make any fact or statement therein misleading and, in the case of accounts and statements of
financial position, they have been prepared in accordance with generally accepted international accounting principles, standards and practices which have been consistently applied;
|
(c) |
No Default: no Default has occurred and is continuing;
|
(d) |
No Taxes: no Taxes are imposed by deduction, withholding or otherwise on any payment to be made by any Security Party under this
Agreement and/or any other of the Finance Documents or are imposed on or by virtue of the execution or delivery of this Agreement and/or any other of the Finance Documents or any document or instrument to be executed or delivered hereunder
or thereunder. In case that any Tax exists now or will be imposed in the future, it will be borne by the Borrowers;
|
(e) |
No Default under other Financial Indebtedness: neither of the Borrowers nor any other Security Party (other than the Approved
Managers) is in Default under any agreement relating to Financial Indebtedness to which it is a party or by which it is or may be bound;
|
(f) |
Ownership/Flag/Seaworthiness/Class/Insurance of the Vessels: each Vessel on the Drawdown Date will be:
|
(i) |
in the absolute and free from Security Interests (other than in favour of the Lender) ownership of the Owner thereof who is and will on and after the Drawdown Date be the sole legal and beneficial owner of that Vessel;
|
(ii) |
registered in the name of the Owner thereof through the relevant Registry of the port of registry of the Flag State under the laws and flag of the Flag State;
|
(iii) |
operationally seaworthy and in every way fit for service;
|
(iv) |
classed with a Classification Society member of IACS, which has been approved by the Lender in writing and such classification is and will be free of all requirements and overdue recommendations of such Classification Society;
|
(v) |
insured in accordance with the provisions of this Agreement and the relevant Mortgage;
|
(vi) |
managed by the Approved Managers; and
|
(vii) |
in full compliance with the ISM and the ISPS Code;
|
(g) |
No Charter: unless otherwise permitted in writing by the Lender, none of the Vessels will on or before the Drawdown Date or be
subject to any charter or contract nor to any agreement to enter into any charter or contract which, if entered into after the Drawdown Date would have required the consent of the Lender under any of the Finance Documents and there will not
on or before the Drawdown Date be any agreement or arrangement whereby the Earnings of the relevant Vessel may be shared with any other person;
|
(h) |
No Security Interests: neither the Vessel, nor its Earnings, Requisition Compensation or Insurances nor any other
properties or rights which are, or are to be, the subject of any of the Security Documents nor any part thereof will, on the Drawdown Date, be subject to any Security Interests other than Permitted Security Interests or otherwise permitted
by the Finance Documents;
|
(i) |
Compliance with Environmental Laws and Approvals: eexcept as may already have been disclosed by the Borrowers in writing to, and
acknowledged in writing by, the Lender:
|
(i) |
each Borrower and its Related Companies have complied with the provisions of all Environmental Laws;
|
(ii) |
each Borrower and its Related Companies have obtained all Environmental Approvals and are in compliance with all such Environmental Approvals; and
|
(iii) |
neither the Borrowers nor any of their respective Related Companies have received notice of any Environmental Claim
that the Borrowers or any of their respective Related Companies are not in compliance with any Environmental Law or any Environmental Approval;
|
(j) |
No Environmental Claims: except as may already have been disclosed by the Borrowers in writing to, and acknowledged in writing by,
the Lender:
|
(i) |
there is no Environmental Claim pending or, to the best of the Borrowers’ knowledge and belief, threatened against either Borrower or its Vessel or that Borrower’s Related Companies or any other
Relevant Ship; and
|
(ii) |
there has been no emission, spill, release or discharge of a Material of Environmental Concern from the Vessels or any other Relevant Ship or any vessel owned by, managed or crewed by or chartered to either Borrower which could give rise
to an Environmental Claim;
|
(k) |
Copies true and complete: the copies of the Management Agreements delivered or to be delivered to the Lender pursuant to Clause 7.1
(Conditions precedent to the execution of this Agreement) are, or will when delivered be, true and complete copies of such documents; such documents will when delivered constitute valid and
binding obligations of the parties thereto enforceable in accordance with their respective terms and there will have been no amendments or variations thereof or defaults thereunder;
|
(l) |
DOC and SMC: in relation to each Vessel the DOC applicable to each Approved Manager and the SMC applicable to that Vessel are
presently in full effect;
|
(m) |
Compliance with ISM Code: each Vessel will comply on the Drawdown Date and the Operator complies with the requirements of the ISM
Code and the SMC which has been or, as the case may be, shall be issued in respect of each relevant Vessel shall remain valid on the Drawdown Date and thereafter throughout the Security Period;
|
(n) |
Compliance with ISPS Code: each Borrower has a valid and current ISSC in respect of its Vessel and it is and will be in full
compliance with the ISPS Code; and the Operator complies with the requirements of the ISPS Code and the ISSC in respect of each Vessel shall remain valid throughout the Security Period;
|
(o) |
Shareholdings:
|
(i) |
each Borrower is a fully owned Subsidiary of the Corporate Guarantor and the shares in the Corporate Guarantor are legally and
beneficially owned as disclosed to the Lender before signing of this Agreement; and
|
(ii) |
no change of control has been made directly or indirectly in the ownership, beneficial ownership, or management of each of the Borrowers and the Corporate Guarantor or any share therein or of the Vessel and the voting rights in each of the Borrowers and the Corporate
Guarantor, but, so far as the Corporate Guarantor is concerned, the result of such change is that the controlling interest in the Corporate Guarantor ceases to remain in the Beneficial Shareholder(s)
disclosed to the Lender before signing of this Agreement , unless otherwise permitted by the Lender; and
|
(p) |
No US Tax Obligor: none of the Security Parties is a US Tax Obligor;
|
(q) |
Sanctions: neither any Security Party nor any other member of the Group:
|
(i) |
is a Sanctions Restricted Person;
|
(ii) |
owns or controls directly or indirectly a Sanctions Restricted Person; or
|
(iii) |
has a Sanctions Restricted Person serving as a director, officer or, to the best of its knowledge, employee; and
|
(iv) |
no proceeds of the Loan shall be made available, directly or to the knowledge of the Borrowers, or any of them (after reasonable enquiry) indirectly, to or for the benefit of a Sanctions Restricted Person contrary to Sanctions or for
transactions in a Sanctions Restricted Jurisdiction nor shall they be otherwise directly or indirectly, applied in a manner or for a purpose prohibited by Sanctions.
|
6.3 |
Money laundering - acting for own account
|
6.4 |
Representations Correct
|
6.5 |
Repetition of Representations and Warranties
|
(a) |
on the date of service of the Drawdown Notice;
|
(b) |
on the Drawdown Date; and
|
(c) |
on each Interest Payment Date throughout the Security Period,
|
7. |
CONDITIONS PRECEDENT
|
7.1 |
Conditions precedent to the execution of this Agreement
|
(a) |
Constitutional Documents: a duly certified true copy of the Articles of Incorporation and By-Laws or the Memorandum and Articles of
Association, or of any other constitutional documents, as the case may be, of each corporate Security Party;
|
(b) |
Certificates of incumbency: a recent certificate of incumbency of each corporate Security Party issued by the appropriate authority
and/or at the discretion of the Lender signed by the secretary or a director of each of them respectively, stating the corporate body which binds every one of them, the officers and/or the directors of each of them and containing specimens
of their signatures;
|
(c) |
Shareholding: a statement to the Lender confirming the identity of the Beneficial Shareholder(s) of each of the Borrowers and the Corporate Guarantor in line with “know your customer” procedures of the Lender for opening account purposes, who should be
acceptable in all respects to the Lender; in the event that the Lender agrees (at its sole discretion) that a Security Party may have a corporate shareholder, the conditions set out in Sub-clauses (a) (Constitutional
Documents), (b) (Certificates of incumbency), (d) (Resolutions) and (e) (Powers of
Attorney) of this Clause 7.1 shall apply (mutatis mutandis) to such corporate shareholder;
|
(d) |
Resolutions: minutes of separate meetings of the directors and (if required) shareholders of each of the Borrowers and the Corporate
Guarantor at which there was approved (inter alia) the entry into, execution, delivery and performance of this Agreement, the other Finance Documents and any other documents executed or to be executed pursuant hereto or thereto to which the
relevant Security Party is or is to be a party;
|
(e) |
Powers of Attorney: the original of any power(s) of attorney and any further evidence of the due authority of any person signing
this Agreement, the other Finance Documents, and any other documents executed or to be executed pursuant hereto or thereto on behalf of any corporate person;
|
(f) |
Consents: evidence that all necessary licences, consents, permits and authorisations (including exchange control ones) have been
obtained by any Security Party for the execution, delivery, validity, enforceability, admissibility in evidence and the due performance of the respective obligations under or pursuant to this Agreement and the other Finance Documents;
|
(g) |
Fees: evidence that the fees referred to in Clause 10.14 (Arrangement Fee) have
been paid in full;
|
(h) |
DOC: a copy of the DOC applicable to each Approved Manager certified as true and in effect;
|
(i) |
Other documents: any other documents or recent certificates or other evidence which would be required by the Lender in relation to
each Security Party evidencing that the relevant Security Party has been properly established, continues to exist validly and is in good standing;
|
(j) |
Management Agreements – Assignable Charterparty: a copy of each of the following documents certified as true and complete by the legal counsel of the Borrowers:
|
(i) |
each Management Agreement evidencing that the relevant Vessel is
managed by the Approved Managers on terms acceptable to the Lender; and
|
(ii) |
any Assignable Charterparty; and
|
(k) |
Operating Accounts: evidence that the Operating Accounts have been duly opened and all mandate forms and other legal documents
required for the opening of an account under any applicable law, as well as signature cards and properly adopted authorizations have been duly delivered to and have been accepted by the compliance department of the Lender.
|
7.2 |
Conditions precedent to the making of the Commitment
|
(a) |
Conditions precedent: evidence that the conditions precedent set out in Clause 7.1 (Conditions precedent to the execution of this Agreement) remain fully satisfied;
|
(b) |
Drawdown Notice: the Drawdown Notice duly executed, issued and delivered to the Lender as provided in Clause
2.2 (Drawdown Notice and commitment to borrow);
|
(c) |
Security Documents: each of the Security Documents duly executed and where appropriate duly registered with the
Registry or any other competent authority (as required);
|
(d) |
Title and no Security Interests: evidence that, prior to or simultaneously with the
drawdown, each Vessel will be duly registered in the ownership of the Owner thereof with the Registry and under the laws and flag of the Flag State free from any Security Interests save for those in favour of the Lender and otherwise as
contemplated herein;
|
(e) |
Insurances: evidence in form and substance satisfactory to the Lender that each Vessel has been insured in accordance with the
insurance requirements provided for in this Agreement and the Security Documents, to be followed by full copies of cover notes, policies, certificates of entry or other contracts of insurance and irrevocable authority is hereby given to the
Lender at any time at its discretion to obtain copies of the policies, certificates of entry or other contracts of insurance from the insurers and/or obtain any information in relation to the Insurances relating to that Vessel;
|
(f) |
Insurers’ confirmations: evidence in form and substance satisfactory to the Lender that each
Vessel has been insured in accordance with the insurance requirements provided for in this Agreement and the other Security Documents, including a MII and a MAPI, accompanied by waivers for liens for unpaid premium of other
vessels managed by the relevant Approved Manager, together with an opinion from insurance consultants (appointed by the Lender at the Borrowers’ expense) as to the adequacy of the insurances effected or
to be effected in respect of each Vessel, to be followed by full copies of cover notes, policies, certificates of entry or other contracts of insurance and irrevocable authority is hereby given to the Lender at any time at its discretion
to obtain copies of the policies, certificates of entry or other contracts of insurance from the insurers and/or obtain any information in relation to the Insurances relating to each Vessel;
|
(g) |
MII and MAPI: the MII and the MAPI shall have been effected by the Lender, but at the expense of the Borrowers as provided in Clause 10.9 (MII costs and MAPI);
|
(h) |
Access to class records: due authorisation from the Drawdown Date in form and substance satisfactory to the Lender authorising the
Lender to have access and/or obtain any copies of class records or other information at its discretion from the Classification Society of the relevant Vessel, provided however, that the Lender shall not exercise such right unless
and until an Event of Default has occurred and is continuing;
|
(i) |
Notices of assignment: duly executed notices of assignment in the form prescribed by the
Security Documents;
|
(j) |
Mortgage registration; evidence that each Mortgage on or before the Drawdown Date will be
registered against the relevant Vessel through the Registry under the laws and flag of the Flag State;
|
(k) |
Trading certificates: upon issuance, copies of the trading certificates of each Vessel
certified as true and complete by the legal counsel of the Borrowers evidencing the same to be valid and in force;
|
(l) |
Class confirmation: evidence from the Classification
Society that on the Drawdown Date each Vessel is classed with the class notation (referred to in the Mortgage relative thereto), with the Classification Society or to a similar standard with
another classification society of like standing to be specifically approved by the Lender and remains free from any overdue requirements or recommendations affecting her class;
|
(m) |
Trim and stability booklet: if so requested by the Lender, an extract of the trim and stability booklet
certifying the lightweight of each Vessel, certified as true and complete by the legal counsel of the Borrowers;
|
(n) |
DOC and SMC: (i) a certified copy of the DOC issued to the Operator of each Vessel and (ii)
a certified copy of the SMC for each Vessel;
|
(o) |
ISM Code Documentation: copies of such applications for ISM Code Documentation as the Lender may by written notice to the Borrowers
have requested not later than two (2) days before the Drawdown Date certified as true and complete in all material respects by the Borrowers and the Approved Managers;
|
(p) |
ISPS Code compliance:
|
(i) |
evidence satisfactory to the Lender that each Vessel is subject to a ship security plan which complies with the ISPS Code (such as proof that a security plan has been submitted to the recognized organisation for approval); and
|
(ii) |
a copy, certified as a true and complete copy of the ISSC for each Vessel delivered to the Lender on the Drawdown Date;
|
(r) |
Valuation: charter free valuation of each Vessel
satisfactory to the Lender, to be obtained by the Lender, at the Borrowers’ expense, not earlier than twenty (20) days prior to the expected Drawdown Date, made on the basis and in the manner
specified in Clause 8.5(b) (Valuation of Vessels);
|
(s)
|
Insurance Letters: the Insurance Letters duly executed;
|
(t) |
Confirmations from process agents: confirmation from any agents nominated in this Agreement and elsewhere in the other Finance
Documents for the acceptance of any notice or service of process, that they consent to such nomination;
|
(u) |
Acknowledgement of Receipt: a receipt in writing in form and substance satisfactory to the Lender including an acknowledgement and
admission of the Borrowers and the Corporate Guarantor to the effect that the Commitment or relevant part thereof (as the case may be) was drawn by the Borrowers and a declaration by the Borrowers and the Corporate Guarantor that all
conditions precedent have been fulfilled, that there is no Event of Default and that all the representations and warranties are true and correct;
|
(v) |
Legal opinions: draft opinion from lawyers appointed by the Lender as to all the matters referred to in Clause 6.1(a) (Due Incorporation/Valid Existence) and Clause 6.1(b) (Due Corporate Authority) and all such aspects of law as the Lender shall deem relevant to
this Agreement and the other Finance Documents and any other documents executed pursuant hereto or thereto and any further legal or other expert opinion as the Lender at its sole discretion may require;
|
(w) |
Flag State opinion: draft opinion of legal advisers to the Lender on matters of the laws
of the Flag State of the relevant Vessel;
|
(x) |
Condition survey report: if the Lender so requires, a satisfactory to the Lender physical condition survey report on each Vessel
together with a comprehensive record inspection from a surveyor appointed by the Lender, at the Borrowers’ expense.
|
7.3 |
No change of circumstances
|
(a) |
Representations and warranties: the representations and warranties set out in Clause 6 (Representations
and warranties) and in each of the other Finance Documents are true and correct on and as of each such time as if each was made with respect to the facts and circumstances existing at such time;
|
(b) |
No Event of Default: no Event of Default shall have occurred and be continuing or would result from the drawdown;
|
(c) |
No change: the Lender shall be satisfied that (i) there has been no change in the control of any of the Borrowers and the Corporate
Guarantor from that disclosed to the Lender at the negotiation of this Agreement and no change directly or indirectly in the ownership, beneficial ownership, or management of the Borrowers (or either of them), each of which is a fully owned
Subsidiary of the Corporate Guarantor, or any share therein or of the Vessels (or either of them), but, so far as the Corporate Guarantor is concerned, the result of such change is that the control in the Corporate Guarantor ceases to remain in the Beneficial Shareholder(s) disclosed to the Lender before signing of this Agreement and (ii) there has been no Material Adverse Change in the financial condition of any Security Party
which (change) might, in the sole opinion of the Lender, be detrimental to the interests of the Lender, provided, however, that such ‘control’ (as defined in Clause 1.4 (Construction of certain terms) of the Loan Agreement) of each of the Borrowers and Guarantor will remain with such Beneficial Shareholder(s) throughout the remainder of the Security Period; and
|
(d) |
No Market Disruption Event: none of the circumstances contemplated by Clause 3.6 (Market
disruption – Non Availability) has occurred and is continuing.
|
7.4 |
Know your customer and money laundering compliance
|
7.5 |
Further documents
|
7.6 |
Waiver of conditions precedent
|
8. | COVENANTS |
8.1 |
General
|
(a) |
Notice on Material Adverse Change or Default: promptly inform the Lender upon becoming aware of any occurrence which might
materially adversely affect the ability of any Security Party to perform its obligations under any of the Finance Documents and, without limiting the generality of the foregoing, will inform the Lender of any Default forthwith upon becoming
aware thereof and will from time to time, if so requested by the Lender, confirm to the Lender in writing that, save as otherwise stated in such confirmation, no Default has occurred and is continuing;
|
(b) |
Notification of litigation:
|
(i) |
provide the Lender with details of any legal or administrative action involving that Borrower, the Vessel owned by it, any bareboat charterer, any bareboat guarantor, the Earnings or the Insurances in respect of that Vessel, any Security
Party, as soon as such action is instituted or it becomes apparent to that Borrower that it is likely to be instituted, unless it is clear that the legal or administrative action cannot be considered material in the context of any Finance
Document, and each Borrower shall procure that all reasonable measures are taken to defend any such legal or administrative action; and
|
(ii) |
and shall procure that any bareboat charterer shall supply to the Lender promptly, to the extent permitted by law, details of any claim, action, suit, proceedings or investigation against it with respect to Sanctions by any Sanctions
Authority;
|
(c) |
Consents and licenses: without prejudice to Clauses 6 (Representations and warranties) and
7 (Conditions precedent), obtain or cause to be obtained, maintain in full force and effect and comply in all material respects with the conditions and restrictions (if any) imposed in, or in
connection with, every consent, authorisation, license or approval of governmental or public bodies or authorities or courts and do or cause to be done, all other acts and things which may from time to time be necessary or desirable under
applicable law for the continued due performance of all the obligations of the Security Parties under each of the Finance Documents;
|
(d) |
Use of Loan proceeds: use the Loan exclusively for the purposes specified in Clause 1.1 (Amount
and Purpose);
|
(e) |
Pari passu: ensure that its obligations under this Agreement shall, without prejudice to the provisions of this Clause 8.1, at all
times rank at least pari passu with all its other present and future unsecured and unsubordinated Financial Indebtedness with the exception of any obligations which are mandatorily preferred by law and not by contract;
|
(f) |
Financial statements: furnish the Lender with (i) audited annual consolidated financial statements of the Corporate Guarantor
audited by the auditors acceptable to the Lender and (ii) management prepared accounts of the Borrowers attested by its financial officer, in each case prepared in accordance with internationally accepted accounting principles and
practices consistently applied in respect of each Financial Year as soon as practicable but not later than 180 days after the end of the Financial Year to which they relate, commencing with Financial Year ending on 31st December, 2021; xxx
|
(g) |
Provision of further information: promptly, when requested, provide the Lender with such financial and other information and
accounts relating to the business, undertaking, assets, liabilities, revenues, financial condition commitments, operations or affairs of the Borrowers and the Corporate Guarantor and such other further general information relating to each
Security Party as the Lender from time to time may reasonably require;
|
(h) |
Financial Information: provide the Lender from time to time as the Lender may reasonably request with
information on the financial conditions, cash flow position, commitments and operations of the Borrowers and the Corporate Guarantor including cash flow analysis and voyage accounts of each
Vessel with a breakdown of income and running expenses showing net trading profit, trade payables and trade receivables, such financial details to be certified by an authorized signatory of the Borrowers
as to their correctness;
|
(i) |
Information on the employment of the Vessels: provide the Lender from time to time as the Lender may request with information on
the employment of each Vessel, as well as on the terms and conditions of any charterparty, contract of affreightment, agreement or related document in respect of the employment of each Vessel, such information to be certified by one of the
directors of the Borrowers as to their correctness;
|
(j) |
Pledged Deposit: procure that upon drawdown and at all times during the Security Period, the Borrowers shall
maintain in interest bearing accounts with the Lender an amount of Dollars Seven hundred thousand ($700,000) ($350,000 per Vessel) (which for the purpose of this Agreement shall be called herein the “Pledged Deposit”), which amount will remain pledged in favour of the Lender throughout the Security Period; provided however that
in case of sale or refinancing of either Vessel the amount of the Pledged Deposit will be reduced to $350,000;
|
(k) |
Banking operations: ensure that all banking operations in
connection with the Vessels are carried out through the Lending Office of the Lender;
|
(l) |
Subordination: ensure that all Financial Indebtedness of the Borrowers to their respective
shareholders is fully subordinated to the rights of the Lender under the Finance Documents, all in a form acceptable to the Lender, and to subordinate to the rights of the Lender under the Finance Documents any Financial Indebtedness issued
to it by its shareholders, all in a form acceptable to the Lender;
|
(m) |
Obligations under Finance Documents: duly and punctually perform each of the obligations expressed to be assumed by it under the
Finance Documents;
|
(n) |
Payment on demand: pay to the Lender on demand any sum of money which is payable by the Borrowers to the Lender under this Agreement
but in respect of which it is not specified in any other Clause when it is due and payable;
|
(o) |
Compliance with Laws and Regulations: comply, or procure compliance with all laws or regulations relating to it
and/or its Vessel, its ownership, operation and management or to the business of such Borrower and cause this Agreement and the other Finance Documents to comply with and satisfy all the requirements and formalities established by the
applicable laws to perfect this Agreement and the other Finance Documents as valid and enforceable Finance Documents;
|
(p) |
Maintenance of Security Interests:
|
(i) |
at its own cost, do all that it reasonably can to ensure that any Finance Document validly creates the obligations and the Security Interests which it purports to create; and
|
(ii) |
without limiting the generality of paragraph (p) above, at its own cost, promptly register, file, record or enrol any Finance Document with any court or authority in all Relevant Jurisdictions, pay any stamp, registration or similar tax in
all Relevant Jurisdictions in respect of any Finance Document, give any notice or take any other step which may be or has become necessary or desirable for any Finance Document to be valid, enforceable or admissible in evidence or to ensure
or protect the priority of any Security Interest which it creates;
|
(q) |
Registered Office: maintain its registered office at the address referred to in the Recitals;
and will not establish, or do anything as a result of which it would be deemed to have, a place of business in the United Kingdom or the United States of America;
|
(r) |
Compliance with Covenants: duly and punctually perform all obligations under this Agreement and the other Finance Documents; and
|
(s) |
No US Tax Obligor: procure that, unless otherwise agreed by the Lender, no Security Party shall become a US Tax
Obligor.
|
8.2 |
Negative undertakings
|
(a) |
Negative pledge:
|
(i) |
not permit any Security Interest (other than a Permitted Security Interest) to subsist, arise or be created or extended over all or any part of its present or future undertakings, assets, rights or revenues to secure or prefer any present
or future Financial Indebtedness or other liability or obligation of the Borrowers (or any of them) or any other person other than in the normal course of its business of owning, financing and operating vessels and owning or acquiring
ship-owning companies; and
|
(ii) |
not cease to hold the legal title to, and own the entire beneficial interest in its Vessel, its Insurances and Earnings, free from all Security Interests and other interests and rights of every kind, except for those created by the Finance
Documents and the effect of the assignments contained in the relevant General Assignment and any other Finance Documents;
|
(b) |
No further Financial Indebtedness: not incur any further Financial Indebtedness nor authorise or accept any capital commitments
(other than that normally associated with the day to day operations and trading of the Borrowers and any Financial Indebtedness that is subordinated (in writing with the Lender’s prior written
consent, at its discretion, and pursuant to a subordination agreement acceptable to the Lender) to all Financial Indebtedness incurred under the Finance Documents) nor enter into any agreement for
payment on deferred terms or hire agreement;
|
(c) |
No merger: not merge or consolidate with any other person;
|
(d) |
No disposals:
|
(i) |
not sell, transfer, abandon, lend, lease or otherwise dispose of or cease to exercise direct control over any part (being either alone or when aggregated with all other disposals falling to be taken into account pursuant to this Clause
8.2(d) material in the opinion of the Lender in relation to the undertakings, assets, rights and revenues of the Borrowers) of its present or future undertaking, assets, rights or revenues (otherwise than by transfers, sales or disposals for
full consideration in the ordinary course of operations and trading) whether by one or a series of transactions related or not; and
|
(ii) |
not transfer, lease or otherwise dispose of any debt payable to it or any other right (present, future or contingent right) to receive a payment, including any right to damages or compensation;
|
(e) |
No acquisitions: not acquire any further assets other than its Vessel and rights arising under contracts entered into by or on
behalf of that Borrower other than in the ordinary course of its business of owning, operating and chartering its Vessel;
|
(f) |
No other business: not undertake any type of business other than its current business of owning, financing and operating vessels and
owning or acquiring ship-owning companies;
|
(g) |
No investments: not make any investments in any person, asset, firm, corporation, joint venture or other entity;
|
(h) |
No other obligations: not incur any liability or obligations except liabilities and obligations arising under the Finance Documents
or contracts entered into in the ordinary course of its business of owning, operating, maintaining, repairing and chartering its Vessel (and for the purposes of this Clause 8.2(h) fees to be paid pursuant to the Management Agreement in
respect of its Vessel shall be considered as permitted obligations under the Finance Documents);
|
(i) |
No borrowing: not incur any Borrowed Money except for Borrowed Money pursuant to the Finance Documents;
|
(j) |
No repayment of borrowings: not repay the principal of, or pay interest on or any other sum in connection with, any of its Borrowed
Money except for Borrowed Money pursuant to the Finance Documents;
|
(k) |
No Payments: unless otherwise provided in this Agreement and the other Finance Documents (and then only to the extent expressly
permitted by the same) not pay out any funds (whether out of the Earnings or out of moneys collected under the relevant General Assignment and/or the other Finance Documents or not) to any person except in connection with the administration
of such Borrower and the operation and/or maintenance and/or repair and/or trading of its Vessel;
|
(l) |
No guarantees: not issue any guarantees or indemnities or otherwise become directly or contingently liable for the obligations of
any person, firm, or corporation except pursuant to the Finance Documents and except for, in the case of such Borrowers, guarantees or indemnities from time to time required in the ordinary course of its business or by any protection and
indemnity or war risks association with which its Vessel is entered, guarantees required to procure the release of its Vessel from any arrest, detention, attachment or levy or guarantees or undertakings required for the salvage of its
Vessel;
|
(m) |
No loans: not make any loans or advances to, or any investments in any person, firm, corporation, joint venture or other entity
including (without limitation) any loan or advance or grant any credit (save for normal trade credit in the ordinary course of business) to any officer, director, stockholder or employee or any other company managed by the Approved Head
Manager or the Approved Commercial Manager directly or through the Approved Head Manager or the Approved Commercial Manager of the Vessels or agree to do so, provided, always, that any loans of its shareholders to either Borrower
shall be fully subordinated to that Borrower’s obligations under this Agreement and the other Finance Documents;
|
(n) |
No securities: not permit any Financial Indebtedness of the Borrowers (or any of them) to any person (other than the Lender) to be
guaranteed by any person (save, in the case of either Borrower, for guarantees or indemnities from time to time required in the ordinary course of business or by any protection and indemnity or war risks association with which its Vessel is
entered, guarantees required to procure the release of its Vessel from any arrest, detention, attachment or levy or guarantees or undertakings required for the salvage of its Vessel);
|
(o) |
No dividends or distribution: not declare or pay any dividends or other distribution
under any name or description upon any of the issued shares or otherwise dispose of any of its present or future assets, undertakings, rights or revenues (which are all assigned to the Lender) to any of the shareholders of either Borrower
without the prior written consent of the Lender, provided that, subject to (i) no Event of Default having occurred and being continuing and (ii) no Event of Default resulting from the payment of such dividends or the making of any
other form of distribution, a Borrower shall be entitled to declare or make payments of any dividends without the prior written approval of the Lender;
|
(p) |
No Subsidiaries: not form or acquire any Subsidiaries;
|
(q) |
No change of business structure: not change the nature, organisation and conduct of its business or carry on any business other than
the business carried on at the date of this Agreement;
|
(r) |
No change of legal structure: (such consent not be unreasonably withheld) ensure that none of the documents defining the
constitution of such Borrower shall be materially (in the Lender’s opinion) altered in any manner whatsoever;
|
(s) |
No Security Interest on assets: other than Permitted Security Interests, not allow any part of its undertaking, property, assets or
rights, whether present or future, to be mortgaged, charged, pledged, used as a lien or otherwise encumbered without the prior written consent of the Lender;
|
(t) |
No change of control: ensure that no change shall be made directly or indirectly in the ownership, beneficial ownership, control or
management of any of the Borrowers and the Corporate Guarantor or any share therein, or any of the Vessels, as a result of which the ultimate legal and beneficial ownership of the Beneficial Shareholder(s) disclosed to the Lender at the
negotiation of this Agreement and confirmed in writing on or before the date hereof is materially changed, but so far as the Corporate Guarantor is concerned the result of such change is that the control in the Corporate Guarantor ceases to remain in the Beneficial Shareholder(s) disclosed to the Lender before signing of this Agreement , provided, however, that such ‘control’
(as defined in Clause 1.4 (Construction of certain terms) of the Loan Agreement) of each of the Borrowers and Guarantor will remain with such Beneficial Shareholder(s) throughout the remainder
of the Security Period; and
|
(u) |
No Master Agreement Derivatives: not enter into any transaction in a derivative of any description whatsoever.
|
8.3 |
Undertakings concerning the Vessels
|
(a) |
Conveyance on default: where a Vessel is (or is to be) sold in exercise of any power conferred on the Lender, execute, forthwith
upon request by the Lender, such form of conveyance of that Vessel as the Lender may require;
|
(b) |
Mortgage: execute, and procure the registration of the relevant Mortgage over each Vessel under the laws and flag of the Flag State
immediately upon the drawdown of the Loan on the Drawdown Date;
|
(c) |
Chartering: not let or agree its Vessel to be let:
|
(i) |
on demise charter for any period; or
|
(ii) |
without the prior written consent of the Lender (such consent not to be unreasonably withheld) by any Assignable Charterparty; or
|
(iii) |
on terms whereby more than two (2) months’ hire (or the equivalent) is payable in advance; or
|
(iv) |
otherwise than on bona fide arm’s length terms at the time when its Vessel is fixed; or
|
(v) |
under any pooling or sharing agreement in respect thereof on terms whereby any and all the Earnings of either Vessel
are pooled or shared with any other person;
|
(d) |
Laid-up: not de-activate or lay up its Vessel;
|
(e) |
No amendment to Assignable Charterparty: not waive or fail to enforce, any
Assignable Charterparty to which it is a party or any of its provisions, and will promptly notify the Lender of any material amendment or supplement to any Assignable Charterparty;
|
(f) |
Approved Manager: not without the prior written consent of the Lender (such consent not to be unreasonably withheld) agree or
appoint a manager of either Vessel other than the Approved Managers;
|
(g) |
Ownership/Management/Control: ensure that each Vessel will be registered on the Drawdown Date in the ownership of the Owner thereof
under the laws of the Flag State and thereafter ensure that each Vessel will maintain her registration, ownership, management, control and beneficial ownership;
|
(h) |
Class: ensure that each Vessel will remain in class free of overdue recommendations or average damage affecting class or permitted
by the Classification Society and provide the Lender on demand with copies of all class and trading certificates of each Vessel;
|
(i) |
Insurances: ensure that all Insurances (as defined in the relevant Mortgage/General Assignment)
of each Vessel is maintained and comply with all insurance requirements specified in this Agreement and in the relevant Mortgage and in case of failure to maintain either Vessel so insured, authorise the Lender (and such authorisation is
hereby expressly given to the Lender) to have the right but not the obligation to effect such Insurances on behalf of the Owner (and in case that either Vessel remains in port for an extended period) to effect port risks insurances at the
cost of the Borrowers which, if paid by the Lender, shall be Expenses; the Lender shall be entitled to obtain once per year at Borrowers’ expense an opinion from insurance consultants (appointed by the Lender at the Borrowers’ expense) as
to the adequacy of the insurances effected or to be effected in respect of each Vessel, Provided that (i) if an Event of Default has occurred and is continuing or (ii) if there has been any change in the insurance placement within
such year or (iii) if there has been a Material Adverse Change of the financial condition of any of the insurers of any of the Vessels at the Lender’s sole opinion, the Lender shall be entitled to obtain at Borrowers’ expense such opinion
from such insurance consultants at any time it deems necessary;
|
(j) |
Transfer/Security Interests: not without the prior written consent of the Lender agrees either Vessel or any share therein to be
sold or otherwise disposed of or create or agree to create or permit to subsist any Security Interest over the Vessels (or either of them) (or any share or interest therein) other than Permitted Security Interests;
|
(k) |
Not imperil Flag, Ownership, Insurances: ensure that each Vessel is maintained and trades in conformity with the laws of the Flag
State, of its owning company or of the nationality of the officers, the requirements of the Insurances and nothing is done or permitted to be done which could endanger the flag of such Vessel or its unencumbered (other than Security
Interests in favour of the Lender and Security Interests permitted by this Agreement) ownership or its Insurances;
|
(l) |
Mortgage Covenants: ensure that each Owner always comply with all the covenants provided for in the Mortgage registered over its
Vessel;
|
(m) |
No assignment of Earnings: ensure that neither of the Owners will assign or agree to assign otherwise than to the Lender the
Earnings or any part thereof;
|
(n) |
No sharing of Earnings: ensure that neither of the Owners:
|
(i) |
will enter into any agreement or arrangement for the sharing of any Earnings; and/or
|
(ii) |
will enter into any agreement or arrangement for the postponement of any date on which any Earnings are due or the reduction of the amount of any Earnings or otherwise for the release or adverse alteration of any right of such Owner to any
Earnings; and/or
|
(iii) |
will enter into any agreement or arrangement for the release of, or adverse alteration to, any guarantee or Security Interest relating to any Earnings.
|
(o) |
Assignable Charterparty: ensure and procure that in the event of its Vessel being employed under an Assignable
Charterparty:
|
(i) |
execute and deliver to the Lender within fifteen (15) days of signing thereof a specific assignment of all its rights, title and interest in and to such charter and any charter guarantee in the form of a
Charterparty Assignment and a notice of such assignment addressed to the relevant charterer;
|
(ii) |
ensure (on a best effort basis) that the relevant charterer and any charter guarantor agree to acknowledge to the Lender the specific assignment of such charter and charter guarantee by executing an
acknowledgement substantially in the form included in the relevant Charterparty Assignment;
|
(iii) |
in the case where such charter is a demise charter, the relevant charterer to undertake to the Lender (1) to comply
with all of that Borrower’s undertakings with regard to the employment, insurances, operation, repairs and maintenance of its Vessel contained in this Agreement, the relevant Mortgage and the relevant General Assignment and (2) to provide (inter alia) an assignment of its interest in the insurances of its Vessel in the
form of a tripartite agreement in form and substance acceptable to the Lender, to be made between the Lender, that Borrower and such charterer;
|
(p) |
No freight derivatives: not enter into or agree to enter into any freight derivatives or any other instruments which
have the effect of hedging forward exposures to freight derivatives without the Lender’s consent;
|
(q) |
Vessels’ inspection: permit the Lender (i) by surveyors or other persons appointed by it on its behalf to board its Vessel (and, subject to no Event of Default having occurred and being continuing, no more than once a year (but in any event without interfering with the ordinary trading of its Vessel) for the purpose of inspecting her condition or for the purpose of satisfying itself with regard to proposed or executed repairs and to afford all proper facilities for such inspections and (ii) at any time by
financial or insurance advisors or other persons appointed by the Lender to review the operating and insurance records of its Vessel and the Owner thereof and the costs (as supported by vouchers) of any and all such valuations shall be
borne by the Borrowers;
|
(r) |
Trading: use its Vessel only for civil merchant trading;
|
(s) |
Compliance with ISM Code: procure that each Approved Manager and any Operator will:
|
(i) |
comply with and ensure that the Vessels and any Operator by no later than the Drawdown Date complies with the requirements of the ISM Code, including (but not limited to) the maintenance and renewal of valid certificates pursuant thereto
throughout the Security Period;
|
(ii) |
immediately inform the Lender if there is any threatened or actual withdrawal of either Owner, any Approved Manager’s or an Operator’s DOC or the SMC in respect of either Vessel; and
|
(iii) |
promptly inform the Lender upon the issue to the relevant Owner, any Approved Manager or any Operator of a DOC and to a Vessel of an SMC or the receipt by either Owner, any Approved Manager or any Operator of notification that its
application for the same has been realised;
|
(t) |
Compliance with ISPS Code: procure that the Approved Managers or any Operator will:
|
(i) |
maintain at all times a valid and current ISSC in respect of the relevant Vessel;
|
(ii) |
immediately notify the Lender in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC in respect of the relevant Vessel; and
|
(iii) |
procure that the relevant Vessel will comply at all times with the ISPS Code;
|
(u) |
Maintenance of legal and beneficial interest in the Vessels: hold the legal title to, and own the entire beneficial interest in its
Vessel, its Insurances and Earnings, free from all Security Interests and other interests and rights of every kind, except for those created by the Finance Documents and the effect of assignments contained in the Finance Documents;
|
(v) |
Compliance with Environmental Laws: comply with, and procure that all Environmental Affiliates of any Relevant Party comply with,
all Environmental Laws including without limitation, requirements relating to manning and establishment of financial responsibility and to obtain and comply with, and procure that all Environmental Affiliates such Relevant Party obtain and
comply with, all Environmental Approvals and to notify the Lender forthwith:
|
(i) |
of any Environmental Claim made against any of the Vessels (or any of them), any Relevant Ship and/or their respective Owners; and
|
(ii) |
upon becoming aware of any incident which may give rise to an Environmental Claim and to keep the Lender advised in writing of the relevant Owner’s response to such Environmental Claim on such regular basis and in such detail as the Lender
shall require.
|
(w) |
War Risk Insurance cover: in the event of hostilities in any part of the
world (whether war is declared or not), it will not cause or permit its Vessel to enter or trade to any zone which is declared a war zone by any government or by its Vessel’s war risks insurers unless the prior written consent of the Lender
has been given and the relevant Owner has (at its expense) effected any special, additional or modified insurance cover which the Lender may approve or require.
|
8.4 |
Validity of Securities - Earnings - Taxes etc.
|
(a) |
Validity: ensure and procure that all governmental or other consents required by law and/or any other steps required for the
validity, enforceability and legality of this Agreement and the other Finance Documents are maintained in full force and effect and/or appropriately taken;
|
(b) |
Earnings: ensure and procure that, unless and until directed by the Lender otherwise (i) all the Earnings of its Vessel shall be
paid to its Operating Account and (ii) the persons from whom the Earnings are from time to time due are irrevocably instructed to pay them to the said Operating Account or to such account in the name of such Borrower as shall be from time
to time determined by the Lender in accordance with the provisions hereof and of the relevant Security Documents;
|
(c) |
Taxes: pay all Taxes, assessments and other governmental charges imposed on the Borrowers (or any of them) when the same fall due,
except to the extent that the same are being contested in good faith by appropriate proceedings and adequate reserves have been set aside for their payment if such proceedings fail;
|
(d) |
Additional Documents: from time to time and within fifteen (15) days after the request of the Lender, execute and deliver to the
Lender or procure the execution and delivery to the Lender of all such documents as shall be deemed desirable at the reasonable discretion of the Lender for giving full effect to this Agreement, and for perfecting, protecting the value of
or enforcing any rights or securities granted to the Lender under any one or more of this Agreement, the other Finance Documents and any other documents executed pursuant hereto or thereto and in case that any conditions precedent (with the
Lender’s consent) have not been fulfilled prior to the Drawdown Date, such conditions shall be complied with within fifteen (15) Banking Days after the Lender’s written request (unless the Lender agrees otherwise in writing) and failure to
comply with this covenant shall be an Event of Default.
|
8.5 |
Secured Value to Security Requirement ratio - Valuation of the Vessels
|
(a) |
Security shortfall - Additional Security: If at any time during the Security Period, the Security Value shall be less than the
Security Requirement, the Lender may give notice to the Borrowers requiring that such deficiency be remedied and then the Borrowers shall (unless the sole cause of such deficiency is the Total Loss of the relevant Vessel and the Owner
thereof in full compliance with its obligations in relation to such Total Loss) either:
|
(i) |
prepay (in accordance with Clause 4.2 (Voluntary prepayment) (but without regard to the requirement for ten (10) days’ notice) within a period of thirty (30) days of the date of receipt by
the Borrowers of the Lender’s said notice such sum in Dollars as will result in the Security Requirement after such prepayment (taking into account any other repayment of the Loan made between the date of the notice and the date of such
prepayment) being at least equal to the Security Value; or
|
(ii) |
within thirty (30) days of the date of receipt by the Borrowers of the Lender’s said notice constitute to the satisfaction of the Lender such further security for the Loan as shall be acceptable to the Lender having a value for security
purposes (as determined by the Lender in its absolute discretion) at the date upon which such further security shall be constituted which, when added to the Security Value, shall not be less than the Security Requirement as at such date. Such
additional security shall be constituted by:
|
aa) |
additional pledged cash deposits in favor of the Lender in an amount equal to such shortfall with the Lender and in an account and manner to be determined by the Lender; and/or
|
bb) |
any other security acceptable to the Lender at its absolute discretion to be provided in a manner determined by the Lender.
|
(b) |
Valuation of Vessels: Each of the Vessels shall, for the purposes of this Clause 8.5, be valued in Dollars at least once a year and
at any time that the Lender may reasonably require by one (1) Approved Shipbroker appointed by the Lender, (such valuation to be addressed to the Lender and made without, unless required by the Lender, physical inspection, and on the basis
of a sale for prompt delivery for cash at arm’s length on normal commercial terms as between a willing buyer and a willing seller, without taking into account the benefit of any Assignable Charterparty
or other engagement concerning the relevant Vessel, as may be applicable. The Lender and the Borrowers agree to accept the valuation made by the Approved Shipbroker appointed as aforesaid as conclusive evidence of the Market Value of the
relevant Vessel at the date of such valuation and that such valuation shall constitute the Market Value of the relevant Vessel for the purposes of this Clause 8.5.
|
(c) |
Information: The Borrowers undertake to the Lender to provide the Lender and any such Approved Shipbrokers such information
concerning the relevant Vessel and its condition as such Approved Shipbrokers may reasonably require for the purpose of making any such valuation.
|
(d) |
Costs: All costs in connection with the Lender obtaining any valuation of each of the Vessels referred to in Clause 8.5(b) (Valuation of Vessels), and any valuation of any additional security for the purposes of ascertaining the Security Value at any time or necessitated by the Borrowers electing to constitute
additional security pursuant to Clause 8.5(a)(ii) and all legal and other expenses incurred by the Lender in connection with any matter arising out of this Clause 8.5 shall be borne by the Borrowers.
|
(e) |
Valuation of additional security: For the purpose of this Clause 8.5, the market value of any additional security provided or to be
provided to the Lender shall be determined by the Lender in its absolute discretion without any necessity for the Lender assigning any reason thereto and if such security consists of a vessel shall be that shown by a valuation complying
with the requirements of Clause 8.5(b) (Valuation of Vessels) (whereas the costs shall be borne by the Borrowers in accordance with Clause 8.5(d) (Costs))
or if the additional security is in the form of a cash deposit full credit shall be given for such cash deposit on a Dollar for Dollar basis.
|
(f) |
Documents and evidence: In connection with any additional security provided in accordance with this Clause 8.5, the Lender shall be
entitled to receive such evidence and documents of the kind referred to in Clause 7.1 (Conditions precedent to the execution of this Agreement) as may in the Lender’s opinion be appropriate
and such favourable legal opinions as the Lender shall in its absolute discretion require.
|
8.6 |
Sanctions
|
(a) |
Without limiting Clause 8.7 (Compliance with laws etc.), each of the Borrowers hereby undertakes with the Lender that, from the date of this Agreement and until the date that the Outstanding
Indebtedness is paid in full, it shall ensure that none of the Vessels:
|
(i) |
will be used by or for the benefit of a Sanctions Restricted Person contrary to Sanctions; and/or
|
(ii) |
will be used in trading in any Sanctions Restricted Jurisdiction or in any manner contrary to Sanctions; and/or
|
(iii) |
will be traded in any manner which would trigger the operation of any sanctions limitation or exclusion clause (or similar) in the Insurances.
|
(b) |
Each Borrower shall:
|
(i) |
not directly or to its knowledge (after reasonable enquiry) indirectly use or permit to be used all or any part of the proceeds of the Loan, or lend, contribute or otherwise make available such proceeds directly or to its knowledge (after
reasonable enquiry) indirectly, to any person or entity (i) to finance or facilitate any activity or transaction of or with any Sanctions Restricted Person contrary to Sanctions or in any Sanctions Restricted Jurisdiction, or (ii) in any
other manner that would result in a violation of any Sanctions by any Party;
|
(ii) |
shall not fund all or part of any payment under the Loan out of proceeds derived directly or to its knowledge (after reasonable enquiry) indirectly from any activity or transaction with a Sanctions Restricted Person contrary to Sanctions
or in a Sanctions Restricted Jurisdiction or which would otherwise cause any party to be in breach of any Sanctions; and
|
(iii) |
procure that no proceeds to its knowledge (after reasonable enquiry) from activities or business with a Sanctions Restricted Person contrary to Sanctions or in a Sanctions Restricted Jurisdiction are credited to any of the Accounts.
|
8.7 |
Compliance with laws etc.
|
(a) |
comply, or procure compliance with all laws or regulations by the relevant Security Party:
|
(i) |
relating to its respective business generally; and
|
(ii) |
relating to its Vessel, its ownership, employment, operation, management and registration including, but not limited to, the ISM Code, the ISPS Code, all Environmental Laws and the laws of the Flag State; and
|
(iii) |
all Sanctions;
|
(b) |
obtain, comply with and do all that is necessary to maintain in full force and effect any Environmental Approvals; and
|
(c) |
without limiting paragraph (a) above, not employ its Vessel nor allow its employment, operation or management in any manner contrary to any law or regulation including, but not limited to, the ISM Code, the ISPS Code and all Environmental
Laws which has or is likely to have a Material Adverse Effect on any of the Security Parties.
|
8.8 |
Covenants for the Securities Parties
|
8.9 |
Know your customer and money laundering compliance
|
9. |
EVENTS OF DEFAULT
|
9.1 |
Events
|
(a) |
Non‑payment: any Security Party fails to pay any sum payable by it under any of the Finance Documents at the time, in the currency
and in the manner stipulated in the Finance Documents (and so that, for this purpose, sums payable on demand shall be treated as having been paid at the stipulated time if paid within five (5) Banking Days of demand and other sums due shall
be treated as having been paid at the stipulated time if paid within two (2) Banking Days of its falling due); or
|
(b) |
Breach of Insurance and certain other obligations: any of the Borrowers fails to obtain and/or maintain the Insurances (as defined
in, and in accordance with the requirements of, the Finance Documents) or if any insurer in respect of such Insurances cancels the Insurances or disclaims liability by reason, in either case, of mis‑statement in any proposal for the
Insurances or for any other failure or default on the part of the Borrowers or any other person or the Borrowers commit any breach of or omit to observe any of the obligations or undertakings expressed to be assumed by them under Clause 8 (Covenants); or
|
(c) |
Breach of other obligations: any Security Party commits any breach of or omits to observe any of its obligations or undertakings
expressed to be assumed by it under any of the Finance Documents (other than those referred to in Clauses 9.1(a) (Non‑payment) and 9.1(b) (Breach of
Insurance and certain other obligations) above) and, in respect of any such breach or omission which in the opinion of the Lender is capable of remedy, such action as the Lender may require shall not have been taken within
fifteen (15) days of the Lender notifying in writing the relevant Security Party of such default and of such required action; or
|
(d) |
Misrepresentation: any representation or warranty made or deemed to be made or repeated by or in respect of any Security Party in or
pursuant to any of the Finance Documents or in any notice, certificate or statement referred to in or delivered under any of the Finance Documents is or proves to have been incorrect or misleading in any material respect; or
|
(e) |
Cross‑default: any Financial Indebtedness (other than under the Finance Documents) of any of the Borrowers and the Corporate
Guarantor (in each case related to an amount exceeding the amount of Five hundred thousand Dollars ($500,000) is not paid when due (unless contested in good faith) or any Financial Indebtedness (other
than under the Finance Documents) of any of the Borrowers and the Corporate Guarantor becomes (whether by declaration or automatically in accordance with the relevant agreement or instrument
constituting the same) due and payable prior to the date when it would otherwise have become due (unless as a result of the exercise by that Borrower or the Corporate Guarantor of a voluntary right of
prepayment), or the Lender becomes entitled to declare any such Financial Indebtedness due and payable or any facility or commitment available to any of the Borrowers and the Corporate Guarantor relating
to such Financial Indebtedness is withdrawn, suspended or cancelled by reason of any default (however described) of the person concerned, unless the relevant Security Party shall have satisfied the Lender that such withdrawal, suspension or
cancellation will not affect or prejudice in any way the relevant Security Party’s ability to pay its debts as they fall due, or any guarantee given by any of the Borrowers and the Corporate Guarantor in
respect of such Financial Indebtedness is not honoured when due and called upon; or
|
(f) |
Legal process: any judgment or order made or commenced in good faith by a person against any of the Borrowers and the Corporate
Guarantor is not stayed or complied with within thirty (30) days or a good faith creditor attaches or takes possession of, or a distress, execution, sequestration or other bonafide process is levied or enforced upon or sued out against, any of the undertakings, assets, rights or revenues of any of the Borrowers and the Corporate Guarantor and is not
discharged, or bail is lodged in respect thereof, within thirty (30) days within ; or
|
(g) |
Insolvency: any Security Party becomes insolvent or stops or suspends making payments (whether of principal or interest) with
respect to all or any class of its debts or announces an intention to do so; or
|
(h) |
Reduction or loss of capital: a meeting is convened by any of the Borrowers and the Corporate Guarantor for the purpose of passing
any resolution to purchase, reduce or redeem any of its share capital; or
|
(i) |
Winding up: any petition is presented or other step is taken for the purpose of winding up any Security Party or an order is made or
resolution passed for the winding up of any Security Party or a notice is issued convening a meeting for the purpose of passing any such resolution; or
|
(j) |
Administration: any bonafide petition is presented or other step is taken for the purpose
of the appointment of an administrator of any Security Party or the Lender believes that any such petition or other step is imminent or an administration order is made in relation to any Security Party; or
|
(k) |
Appointment of receivers and managers: any administrative or other receiver is appointed of any Security Party or any part of its
assets and/or undertaking or any other steps are taken to enforce any Security Interest over all or any part of the assets of any such Security Party; or
|
(l) |
Compositions: any steps are taken, or negotiations commenced, by any Security Party or by any of its creditors with a view to the
general readjustment or rescheduling of all or part of its indebtedness or to proposing any kind of composition, compromise or arrangement involving such company and any of its creditors provided, however, that if the Borrowers are
able to provide such evidence as is satisfactory in all respects to the Lender that such rescheduling will not relate to any payment default or anticipated default the same shall not constitute an Event of Default; or
|
(m) |
Analogous proceedings: there occurs, in relation to any Security Party, in any country or territory in which any of them carries on
business or to the jurisdiction of whose courts any part of their assets is subject, any event which, in the opinion of the Lender, appears in that country or territory to correspond with, or have an effect equivalent or similar to, any of
those mentioned in Clauses 9.1(f) (Legal process) to (l) (Compositions) (inclusive) or any Security Party otherwise becomes subject, in any
such country or territory, to the operation of any law relating to insolvency, bankruptcy or liquidation; or
|
(n) |
Cessation of business: any Security Party suspends or ceases or threatens to suspend or cease to carry on its business; or
|
(o) |
Seizure: all or a material part of the undertaking, assets, rights or revenues of, or shares or other ownership interests in, any
Security Party are seized, nationalised, expropriated or compulsorily acquired by or under the authority of any government; and the respective Security Party fails to procure for its release within a period of thirty (30) days; or
|
(p) |
Consents: any consent, authorisation, licence or approval of, or registration with or declaration to, governmental or public bodies
or authorities or courts required by any Security Party to authorise or otherwise in connection with, the execution, delivery, validity, enforceability or admissibility in evidence of this Agreement and/or any of the other Security
Documents or the performance by the Security Parties of their respective obligations under this Agreement and/or any of the other Finance Documents is modified in a manner unacceptable to the Mortgagee or is not granted or is revoked or
terminated or expires and is not renewed or otherwise ceases to be in full force and effect; or
|
(q) |
Invalidity: any of the Finance Documents shall at any time and for any reason become invalid or unenforceable or otherwise cease to
remain in full force and effect, or if the validity or enforceability of any of the Finance Documents shall at any time and for any reason be contested by any Security Party which is a party thereto, or if any such Security Party shall deny
that it has any, or any further, liability thereunder; or
|
(r) |
Unlawfulness: it becomes impossible or unlawful at any time for any Security Party, to fulfil any of the covenants and obligations
expressed to be assumed by it in any of the Finance Documents or for the Lender to exercise the rights or any of them vested in it under any of the Finance Documents or otherwise; or
|
(s) |
Repudiation: any Security Party repudiates any of the Finance Documents or does or causes or permits to be done any act or thing
evidencing an intention to repudiate any of the Finance Documents; or
|
(t) |
Security Interests enforceable: any Security Interest (other than Permitted Security Interest) in respect of any of the property (or
part thereof) which is the subject of any of the Finance Documents becomes enforceable; or
|
(u) |
Arrest: any of the Vessels is arrested, confiscated, seized, taken in execution, impounded, forfeited, detained in exercise or
purported exercise of any possessory lien or other claim or otherwise taken from the possession of its Owner and such Owner shall fail to procure the release of such Vessel within a period of thirty (30) days thereafter; or
|
(v) |
Registration: the registration of any of the Vessels under the laws and flag of the relevant Flag State is cancelled or terminated without the prior written consent of the Lender; if the Vessel is only provisionally registered on the Drawdown Date and is not permanently
registered under the laws and flag of the Flag State at least fifteen (15) days prior to the deadline for completing such permanent registration; or
|
(w) |
Unrest: the Flag State of a Vessel becomes involved in hostilities or civil war or there is a seizure of power in such Flag State by
unconstitutional means if, in any such case, (a) such event could in the opinion of the Lender reasonably be expected to have a Material Adverse Effect on the security constituted by any of the Finance Documents and (b) the relevant Owner
has failed within thirty (30) days from receiving notice from the Lender to this effect (which notice shall have been sent following consultation with the Borrowers) to (i) delete the relevant Vessel from its Flag State and (ii) re-register
the relevant Vessel under another Flag State approved by the Lender in its sole discretion through a relevant Registry, in each case, at the Borrowers’ cost and expense; or
|
(x) |
Environment: any Relevant Party and/or any of their respective Environmental Affiliates fails to comply with any Environmental Law
or any Environmental Approval or any of the Vessels or any Relevant Ship is involved in any incident which gives rise or which may give rise to any Environmental Claim, if in any such case, such noncompliance or incident or the
consequences thereof could (in the reasonable opinion of the Lender) be expected to have a material adverse change as described hereinbelow under paragraph (u); or
|
(y) |
P&I: any Security Party or any other person fails or omits to comply with any requirements of the protection and indemnity
association or other insurer with which any of the Vessels is entered for insurance or insured against protection and indemnity risks (including oil pollution risks) to the effect that any cover in relation to such Vessel (including without
limitation, liability for Environmental Claims arising in jurisdictions where such Vessel operates or trades) is or may be liable to cancellation, qualification or exclusion at any time; or
|
(z) |
Beneficial Ownership: there has been a change of control directly or indirectly in the Borrowers (or either of them) or any share
therein or of either Vessel or of the Corporate Guarantor as a result of which any of the Borrowers and the Corporate Guarantor ceases to remain in the control of the Beneficial Shareholders disclosed to the Lender prior to the date of this
Agreement or either Vessel ceases to remain 100% owned by the Owner thereof; or
|
(aa) |
Change of Management: either Vessel ceases to be managed by any Approved Manager (for any reason other than the reason of a Total
Loss or sale of such Vessel) without the approval of the Lender and the Owner thereof fails to appoint another Approved Manager prior to the termination of the mandate with the previous Approved Manager; or
|
(bb) |
Deviation of Earnings: any Earnings of any of the Vessels are not paid to the relevant Operating Account for any reason whatsoever
(other than with the Lender’s prior written consent); or
|
(cc) |
ISM Code and ISPS Code: (without prejudice to the generality of Clause 9.1(c) (Breach of other
obligations)) for any reason whatsoever the provisions of Clause 8.3(t) (Compliance with ISM Code) and Clause 8.3(u) (Compliance with
ISPS Code) are not complied with and the relevant Vessel ceases to comply with the ISM Code or, as the case may be, the ISPS Code; or
|
(dd) |
Operating Account: any moneys are withdrawn from the Operating Accounts (or any of them) other than in accordance with Clauses
8.4(b) (Earnings) and 13 (Operating Accounts); or
|
(ee) |
Material events: any other event or events (whether related or not) occurs or circumstance arises which constitutes
a Material Adverse Change, from the position applicable as at the date of this Agreement, in the business, affairs or condition (financial or otherwise) of any Security Party) (including any such material adverse change resulting from an
Environmental Incident) the effect of which is likely, in the opinion of the Lender, to impair, delay or prevent the due fulfilment by any Security Party of any of its respective obligations or undertakings contained in this Loan Agreement
or any of the other Finance Documents and/or materially and adversely to affect the security created by any of the Finance Documents; or
|
(ff) |
Finance Documents: any other event of default (as howsoever described or defined therein) occurs under the Finance Documents (or any
of them).
|
9.2 |
Consequences of Default – Acceleration
|
(a) |
by notice to the Borrowers declare that the obligation of the Lender to make the Commitment (or any part thereof) available shall be terminated, whereupon the Commitment shall be reduced to zero forthwith; and/or
|
(b) |
by notice to the Borrowers declare that the Loan and all interest accrued and all other sums payable under the Finance Documents have become due and payable, whereupon the same shall, immediately or in accordance with the terms of such
notice, become due and payable without any further diligence, presentment, demand of payment, protest or notice or any other procedure from the Lender which are expressly waived by the Borrowers; and/or
|
(c) |
put into force and exercise all or any of the rights, powers and remedies possessed by the Lender under this Agreement and/or under any other Finance Document and/or as mortgagee of each of the Vessels, mortgagee, chargee or assignee or as
the beneficiary of any other property right or any other security (as the case may be) of the assets charged or assigned to it under the Finance Documents or otherwise (whether at law, by virtue of any of the Finance Documents or otherwise);
|
9.3 |
Multiple notices; action without notice
|
9.4 |
Demand basis
|
9.5 |
Proof of Default
|
9.6 |
Exclusion of Lender’s liability
|
(a) |
for any loss caused by an exercise of rights under, or enforcement of an Security Interest created by, a Finance Document or by any failure or delay to exercise such a right or to enforce such an Security Interest; or
|
(b) |
as mortgagee in possession or otherwise, for any income or principal amount which might have been produced by or realised from any asset comprised in such an Security Interest or for any reduction (however caused) in the value of such an
asset,
|
10. |
INDEMNITIES - EXPENSES – FEES
|
10.1 |
Miscellaneous indemnities
|
(a) |
any default in payment by any of the Security Parties of any sum under any of the Finance Documents when due;
|
(b) |
the occurrence of any Event of Default which is continuing;
|
(c) |
any prepayment of the Loan or part thereof being made under Clauses 4.2 (Voluntary Prepayment) and 4.3 (Compulsory Prepayment in case of Total Loss or
sale of a Vessel), 8.5(a) (Security shortfall-Additional Security), Clause 12.1 (Unlawfulness)
or Clause 12.4 (Option to prepay) or any other repayment of the Loan or part thereof being made otherwise than on an Interest Payment Date relating to the part of the Loan prepaid or repaid;
or
|
(d) |
the Commitment not being advanced for any reason (excluding any default by the Lender and any reason specified in Clauses 3.6 (Market disruption – Non Availability), 4.3(a) (Total Loss of a Mortgaged Vessel) or 12.1 (Unlawfulness) after the Drawdown Notice has been given, including, in any such case, but not limited to,
any loss or expense sustained or incurred in maintaining or funding the Loan or any part thereof or in liquidating or re-employing deposits from third parties acquired to effect or maintain the Loan or any part thereof.
|
(e) |
The Borrowers shall fully indemnify the Lender on its demand, without prejudice to any of its other rights under any of the Finance Documents, in respect of all claims, liabilities, losses or other Expenses which may be made or brought
against or sustained or incurred by the Lender, in any country, as a result of or in connection with:
|
(i) |
any action taken, or omitted or neglected to be taken, under or in connection with any Finance Document by the Lender or by any receiver appointed under a Finance Document;
|
(ii) |
investigating any event which the Lender reasonably believes constitutes an Event of Default; or
|
(iii) |
acting or relying on any notice, request or instruction which the Lender reasonably believes to be genuine, correct and appropriately authorised,
|
10.2 |
Expenses
|
(a) |
Initial and Amendment expenses: all expenses (including reasonable legal, printing and out-of-pocket expenses) reasonably incurred
by the Lender in connection with the negotiation, preparation and execution of this Agreement and the other Finance Documents and of any amendment or extension of or the granting of any waiver or consent under this Agreement and/or any of
the Finance Documents and/or in connection with any proposal by the Borrowers to constitute additional security pursuant to Clause 8.5(a) (Security shortfall - Additional Security), whether any such security shall in fact be constituted or not;
|
(b) |
Enforcement expenses: all expenses (including reasonable legal and out-of-pocket expenses) incurred by the Lender in contemplation
of, or otherwise in connection with, the enforcement of, or preservation of any rights under, this Agreement and/or any of the other Finance Documents, or otherwise in respect of the moneys owing under this Agreement and/or any of the other
Finance Documents or the contemplation or preparation of the above, whether they have been effected or not;
|
(c) |
Legal costs: the legal costs of the Lender’s appointed lawyers, in respect of the preparation of this Agreement and the other
Finance Documents as well as the legal costs of the foreign lawyers (if these are available) in respect of the registration of the Finance Documents or any search or opinion given to the Lender in respect of the Security Parties or the
Vessels or the Finance Documents. The said legal costs shall be due and payable on the Drawdown Date; and
|
(d) |
Other expenses: any and all other Expenses.
|
10.3 |
Value Added Tax
|
10.4 |
Stamp duty etc.
|
10.5 |
Environmental Indemnity
|
10.6 |
Currency Indemnity
|
10.7 |
Central Bank or European Central Bank reserve requirements indemnity
|
10.8 |
Maintenance of the Indemnities
|
10.9 |
MII and MAPI costs
|
10.10 |
Communications Indemnity
|
(a) |
Express authority is hereby given by the Borrowers to the Lender to accept all tested or untested communications given by facsimile, or electronic mail or otherwise, regarding any or all of the notices, requests, instructions or other
communications under this Agreement, subject to any restrictions imposed by the Lender relating to such communications including, without limitation (if so required by the Lender), the obligation to confirm such communications by letter.
|
(b) |
The Borrowers shall recognise any and all of the said notices, requests, instructions or other communications as legal, valid and binding, when these notices, requests, instructions or communications come from the fax number or electronic
address mentioned in Clause 17.1 (Notices) or any other fax or electronic address usually used by it or its managing company and are duly signed or in case of emails are duly sent by the
person appearing to be sending such notice, request, instruction or other communication.
|
(c) |
The Borrowers hereby assume full responsibility for the execution of the said notices, requests, instructions or communications and promise and recognise that the Lender shall not be held responsible for any loss, liability or expense that
may result from such notices, requests, instructions or other communications. It is hereby undertaken by the Borrowers to indemnify in full the Lender from and against all actions, proceedings, damages, costs, claims, demands, expenses and
any and all direct and/or indirect losses which the Lender may suffer, incur or sustain by reason of the Lender following such notices, requests, instructions or communications.
|
(d) |
With regard to notices, requests, instructions or communications issued by electronic and/or mechanical processes (e.g. by facsimile or electronic mail), the risk of equipment malfunction, including, without limitation, paper shortage,
transmission errors, omissions and distortions is assumed fully and accepted by the Borrowers, save in case of Lender’s gross misconduct.
|
(e) |
The risks of misunderstandings and errors resulting from notices, requests, instructions or communications being given as mentioned above, are for the Borrowers and the Lender will be indemnified in full pursuant to this Clause save in
case of Lender’s gross misconduct.
|
(f) |
The Lender shall have the right to ask the Borrowers to furnish any information the Lender may require to establish the authority of any person purporting to act on behalf of the Borrowers for these notices, requests, instructions or
communications but it is expressly agreed that there is no obligation for the Lender to do so. The Lender shall be fully protected in, and the Lender shall incur no liability to the Borrowers for acting upon the said notices, requests,
instructions or communications which were believed by the Lender in good faith to have been given by the Borrowers or by any of its authorised representative(s).
|
(g) |
It is undertaken by the Borrowers to use its best endeavours to safeguard the function and the security of the electronic and mechanical appliance(s) such as fax(es) etc., as well as the code word list, if any, and to take adequate
precautions to protect such code word list from loss and to prevent its terms becoming known to any persons not directly concerned with its use. The Borrowers shall hold the Lender harmless and indemnified from all claims, losses, damages
and expenses which the Lender may incur by reason of the failure of the Borrowers to comply with the obligations under this Clause 10.10.
|
10.11 |
Electronic communication
|
(a) |
The Borrowers hereby acknowledge and accept the risks associated with the use of unsecured electronic mail communication including, without limitation, risk of delay, loss of data, confidentiality breach, forgery, falsification and
malicious software. The Lender shall not be liable in any way for any loss or damage or any other disadvantage suffered by the Borrowers resulting from such unsecured electronic mail communication.
|
(b) |
If the Borrowers (or any of them) or any other Security Party wish to cease all electronic communication, they shall give written notice to the Lender accordingly after receipt of which notice the Parties shall cease all electronic
communication.
|
(c) |
For as long as electronic communication is an accepted form of communication, the Parties shall:
|
(i) |
notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and
|
(ii) |
notify each other of any change to their respective addresses or any other such information supplied to them; and
|
10.12 |
FATCA Deduction
|
(a) |
Each Party may make any FATCA Deduction it is required to make by FATCA, 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.
|
10.13 |
FATCA status
|
(a) |
Subject to Clause 10.13(c) below, each party shall, within ten Banking Days of a reasonable request by another party:
|
(i) |
confirm to that other party whether it is:
|
(aa) |
a FATCA Exempt Party; or
|
(bb) |
not a FATCA Exempt Party; and
|
(ii) |
supply to that other party such forms, documentation and other information relating to its status under FATCA (including its applicable passthru percentage or other information required under the Treasury Regulations or other official
guidance including intergovernmental agreements) as that other party reasonably requests for the purposes of that other party’s compliance with FATCA.
|
(b) |
If a party confirms to another party pursuant to Clause 10.13(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 10.13(a)(i) above shall not oblige the Lenders or the Lender to do anything which would or might in its reasonable opinion constitute a breach of:
|
(i) |
any law or regulation;
|
(ii) |
any policy of the relevant Lender;
|
(iii) |
any fiduciary duty; or
|
(iv) |
any duty of confidentiality.
|
(d) |
If a party fails to confirm its status or to supply forms, documentation or other information requested in accordance with Clause10.13(a) above (including, for the avoidance of doubt, where Clause 10.13(c) above applies), then:
|
(i) |
if that party failed to confirm whether it is (and/or remains) a FATCA Exempt Party then such party shall be treated for the purposes of the Finance Documents as if it is not a FATCA Exempt Party; and
|
(ii) |
if that party failed to confirm its applicable passthru percentage then such party shall be treated for the purposes of the Finance Documents (and payments made thereunder) as if its applicable passthru percentage is 100%,
|
10.14 |
Arrangement fee
|
(a) |
Arrangement fee: The Borrowers shall pay to the Lender an arrangement fee in an amount equal
to one per cent (1.00%) of the amount of the Loan as at the Drawdown Date payable on the date hereof.
|
(b) |
Non-refundable: The Arrangement Fee shall be payable by the Borrowers to the Lender irrespective of utilisation/cancellation in part
or in whole of the Commitment and shall be non-refundable.
|
11. |
SECURITY, APPLICATION, SET-OFF
|
11.1 |
Securities
|
11.2 |
Maintenance of Securities
|
11.3 |
Application of receipts
|
(a) |
Order of application: Except as any Finance Document may otherwise provide, any sums which are received or
recovered by the Lender under or pursuant to or by virtue of any of the Finance Documents and expressed to be applicable in accordance with this Clause 11.3 shall be applied by the Lender in the
following manner:
|
(i) |
FIRST: in or towards satisfaction of any amounts then due and payable under the Finance Documents in the following order and proportions:
|
aa) |
Firstly, in or towards satisfaction of all amounts then due and payable to the Lender under the Finance Documents
other than those amounts referred to at paragraphs b) and c) below (including, but without limitation, all amounts payable by the Borrower under Clauses 11 (Indemnities- Expenses-Fees), 5.1 (Payments – No set-off or counterclaims) or 5.3 (Gross Up) of this Agreement or by the Borrower or any Security Party under any corresponding or
similar provision in any other Finance Document);
|
a) |
Secondly, in or towards payment of any default interest then due and payable to the Lender;
|
bb) |
Thirdly, in or towards payment of any arrears of interest (other than default interest) due and payable in respect
of the Loan or any part thereof payable to the Lender under the Finance Documents;
|
cc) |
Fourthly, in or towards satisfaction of the Loan then due and payable;
|
(ii) |
SECOND: in retention of an amount equal to any amount not then due and payable under any Finance Document but which the Lender, by notice to the Borrower and the Security Parties, states in its opinion will
either or may become due and payable in the future and, upon those amounts becoming due and payable, in or towards satisfaction of them in accordance with the provisions of Clause 11.3(a); and
|
(iii) |
THIRD: the surplus (if any), after the full and complete payment of the Outstanding Indebtedness, shall be paid to the Borrower or to any other person appearing to be entitled to it.
|
(b) |
Notice of variation of order of application: The Lender may, by notice to the Borrower and the Security Parties,
provide, at its sole discretion, for a different order of application from that set out in Clause 11.3(a) (Order of application) either as regards a specified sum or sums or as regards sums
in a specified category or categories, without affecting the obligations of the Borrower to the Lender.
|
(c) |
Effect of variation notice: The Lender may give notices under Clause 11.3(b) (Notice
of variation of order of application) from time to time; and such a notice may be stated to apply not only to sums which may be received or recovered in the future, but also to any sum which has been received or recovered on
or after the third Banking Day before the date on which the notice is served.
|
(d) |
Insufficient balance: For the avoidance of doubt, in the event that such balance is insufficient to pay in full the
whole of the Outstanding Indebtedness, the Lender shall be entitled to collect the shortfall from the Borrower or any other person liable therefor.
|
(e) |
Appropriation rights overridden: This Clause 11.3 and any notice which the Lender gives under Clause 11.3(b) (Notice of variation of order of application) shall override any right of
appropriation possessed, and any appropriation made, by the Borrower or any other Security Party.
|
11.4 |
Set off
|
(a) |
Application of credit balances: Express authority is hereby given by each Borrower to the Lender without prejudice
to any of the rights of the Lender at law, contractually or otherwise, at any time after an Event of Default has occurred and is continuing, and without prior notice to the Borrowers:
|
(i) |
to apply any credit balance standing upon any account of each Borrower with any branch of the Lender (including, without limitation, the Operating Account and in whatever currency in or towards satisfaction of
any sum due to the Lender from the Borrowers under this Agreement, the General Assignments and/or any of the other Finance Documents;
|
(ii) |
in the name of each of the Borrowers and/or the Lender to do all such acts and execute all such documents as may be necessary or expedient to effect such application; and
|
(iii) |
to combine and/or consolidate all or any accounts in the name of each Borrower with the Lender; and
|
aa) |
to break, or alter the maturity of, all or any part of a deposit of the Borrowers (or either of them);
|
bb) |
to convert or translate all or any part of a deposit or other credit balance into Dollars; and
|
cc) |
to enter into any other transaction or make any entry with regard to the credit balance which the Lender considers appropriate.
|
(b) |
Existing rights unaffected: The Lender shall not be obliged to exercise any right given by this Clause; and
those rights shall be without prejudice and in addition to any right of set-off, combination of accounts, charge, lien or other right or remedy to which the Lender is entitled (whether under the general law or any document). For all or any
of the above purposes authority is hereby given to the Lender to purchase with the moneys standing to the credit of any such account or accounts such other currencies as may be necessary to effect such application. The Lender shall notify
the Borrowers forthwith upon the exercise of any right of set‑off giving full details in relation thereto.
|
12. |
UNLAWFULNESS, INCREASED COST, BAIL-IN
|
12.1 |
Unlawfulness
|
12.2 |
Increased Cost
|
(a) |
increase the cost to, or impose an additional cost on, the Lender or its holding company in making or keeping the Commitment available or maintaining or funding all or part of the Loan; and/or
|
(b) |
subject the Lender to Taxes or change the basis of Taxation of the Lender with respect to any payment under any of the Finance Documents (other than Taxes or Taxation on the overall net income, profits or gains of the Lender imposed in the
jurisdiction in which its principal or lending office under this Agreement is located); and/or
|
(c) |
reduce the amount payable or the effective return to the Lender under any of the Finance Documents; and/or
|
(d) |
reduce the Lender’s or its holding company rate of return on its overall capital by reason of a change in the manner in which it is required to allocate capital resources to the Lender’s obligations
under any of the Finance Document; and/or
|
(e) |
require the Lender or its holding company to make a payment or forgo a return on or calculated by references to any amount received or receivable by it under any of the Finance Documents is required;
and/or
|
(f) |
require the Lender or its holding company to incur or sustain a loss (including a loss of future potential profits) by reason of being obliged to deduct all or part of the Commitment or the Loan from
its capital for regulatory purposes,
|
(a) |
the Lender shall notify the Borrowers in writing of such event promptly upon its becoming aware of the same; and
|
(b) |
the Borrowers shall on demand pay to the Lender the amount which the Lender specifies (in a certificate and supporting documents setting forth and evidencing the basis of the computation of such amount but not including any matters which
the Lender or its holding company regards as confidential) is required to compensate the Lender and/or (as the case may be) its holding company for such liability to Taxes, cost, reduction, payment, foregone return or loss whatsoever.
|
12.3 |
Mitigation
|
12.4 |
Claim for increased cost
|
12.5 |
Option to prepay
|
12.6 |
Exception
|
12.7 |
Contractual recognition of bail-in
|
(a) |
any Bail-In Action in relation to any such liability, including (without limitation):
|
(i) |
a reduction, in full or in part, in the principal amount, or outstanding amount due (including any accrued but unpaid interest) in respect of any such liability;
|
(ii) |
a conversion of all, or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, it; and
|
(iii) |
a cancellation of any such liability; and
|
(b) |
a variation of any term of any Finance Document to the extent necessary to give effect to any Bail-In Action in relation to any such liability.
|
13. |
OPERATING ACCOUNTS
|
13.1 |
General
|
(a) |
on or before the Drawdown Date open its Operating Account; and
|
(b) |
procure that all moneys payable to such Borrower in respect of the Earnings of its Vessel shall, unless and until the Lender directs to the contrary pursuant to the relevant General Assignment, be paid to its Operating Account, free from
Security Interests and rights of set off other than those created by or under the Finance Documents and, shall be held there on trust for the Lender and shall be applied as provided in Clause 13.2 (Application
of Earnings).
|
13.2 |
Application of Earnings
|
(a) |
Subject to the terms and conditions of the Accounts Pledge Agreement no monies shall be withdrawn from the Operating
Accounts save as hereinafter provided. Subject to no Event of Default having occurred and being continuing, all monies paid to the Operating Accounts (whether being Earnings or not) after discharging the costs (if any) incurred by the
Lender, in collecting such monies, shall be applied by the Lender as follows:
|
(i) |
First: in payment of any arrears of interest and principal of the Loan due and payable
and any and all other sums whatsoever which from time to time become due and payable to the Lender hereunder (such sums to be paid in such order as the Lender may in its sole discretion elect);
|
(ii) |
Second: in payment of the Operating Expenses; and
|
(iii) |
Third: any credit balance shall be, subject to the provisions of this Agreement (including dividends restriction) and the Accounts
Pledge Agreement, available to the Borrowers to be used (unless the Lender otherwise direct at its discretion) for any purpose not inconsistent with the
Borrowers’ other obligations under this Agreement;
|
13.3 |
Interest
|
13.4 |
Drawings from Operating Accounts
|
13.5 |
Authorisation
|
13.6 |
Obligations unaffected
|
(a) |
the liability and absolute obligation of the Borrowers to pay interest on and to repay the Loan as provided in Clauses 3 (Interest) and 4 (Repayment-Prepayment) nor shall they constitute or be construed as constituting a manner of postponement thereof; or
|
(b) |
any other liability or obligation of the Borrowers or any other Security Party under any Finance Document.
|
13.7 |
Relocation of Operating Accounts
|
13.8 |
Application on Event of Default
|
13.9 |
No Security Interests
|
13.10 |
Operation of Operating Accounts
|
13.11 |
Release
|
14. |
ASSIGNMENT, TRANSFER, PARTICIPATION, LENDING OFFICE
|
14.1 |
Binding Effect
|
14.2 |
No Assignment by the Borrowers and other Security Parties
|
14.3 |
Assignment by the Lender
|
14.4 |
Participation
|
14.5 |
Cost
|
14.6 |
Documenting assignments and transfers
|
14.7 |
Disclosure of information
|
(a) |
in relation to any proceedings arising out of this Agreement or the other Finance Documents to the extent considered necessary by the Prospective Assignee to protect its interest; or
|
(b) |
pursuant to a court order relating to discovery or otherwise; or
|
(c) |
pursuant to any law or regulation or to any fiscal, monetary, tax, governmental or other competent authority; or
|
(d) |
to its auditors, legal or other professional advisers.
|
14.8 |
Changes in constitution or reorganisation of the Lender
|
14.9 |
Securitisation
|
14.10 |
Lending Office
|
15. |
MISCELLANEOUS
|
15.1 |
Time of essence
|
15.2 |
Cumulative Remedies
|
15.3 |
No implied waivers
|
15.4 |
Recourse to other security
|
15.5 |
Integration of Terms
|
15.6 |
Amendments
|
15.7 |
Invalidity of Terms
|
15.8 |
Language and genuineness of documents
|
(a) |
Language: All certificates, instruments and other documents to be delivered under or supplied in connection with this Agreement or
any of the other Finance Documents shall be in the Greek or the English language (or such other language as the Lender shall agree) or shall be accompanied by a certified Greek translation upon which the Lender shall be entitled to rely.
|
(b) |
Certification of documents: Any copies of documents delivered to the Lender shall be duly certified as true, complete and accurate
copies by appropriate authorities or legal counsel practicing in Greece or otherwise as will be acceptable to the Lender at the sole discretion of the Lender.
|
(c) |
Certification of signature: Signatures on Board or shareholder resolutions, Secretary’s certificates and any other documents are,
at the discretion of the Lender, to be verified for their genuineness by appropriate Consul or other competent authority.
|
15.9 |
Further assurances
|
15.10 |
Inconsistency of Terms
|
15.11 |
Counterparts
|
15.12 |
Confidentiality
|
(a) |
Each of the parties hereto agree and undertake to keep confidential any documentation and any confidential information concerning the business, affairs, directors or employees of the other which comes into its possession in connection with
this Agreement and not to use any such documentation, information for any purpose other than for which it was provided.
|
(b) |
The parties acknowledge and accept that they may be required by law or that it may be appropriate for them to disclose information and deliver documentation relating to the transactions and matters in relation to this Agreement and/or the
other Finance Documents to governmental or regulatory agencies and authorities.
|
(c) |
The Borrowers acknowledge and accept that in case of occurrence of any of the Events of Default the Lender may disclose information and deliver documentation relating to the Borrowers and the transactions and matters in relation to this
Agreement and/or the other Finance Documents to third parties to the extent that this is necessary for the enforcement or the contemplation of enforcement of the Lender’s rights or for any other purpose for which in the opinion of the Lender,
such disclosure would be useful or appropriate for the interests of the Lender or otherwise and the Borrowers expressly authorise any such disclosure and delivery.
|
(d) |
The Borrowers acknowledge and accept that the Lender may be prohibited or it may be inappropriate for the Lender to disclose information to the Borrowers by reason of law or duties of confidentiality owed or to be owed to other persons.
|
(e) |
This Clause 15.12 shall be: (i) in addition to all other duties of confidentiality imposed on the Lender and its professional advisers under applicable law; and (ii) subject to any other applicable provisions contained in this Agreement
and the other Finance Documents.
|
15.13 |
Process of personal data
|
(a) |
Process of personal data: The Borrower hereby confirms that it has been informed that its personal data and/or the personal data of
its director(s), officer(s) and legal representative(s) (together the “personal data”) contained in this Agreement (and any supplemental or amendatory agreement thereof) and the other Finance
Documents or the personal data that have been or will be lawfully received or obtained by the Lender in relation to this Agreement and the other Finance Documents or the enforcement of all of the rights, powers and remedies possessed by the
Lender under this Agreement (and any supplemental or amendatory agreement thereof) and/or under any other Finance Document will be included at the personal data database maintained by the Lender as processing agent (Υπεύθυνη Επεξεργασίας) and will be processed by the Lender or by third parties for the purpose of maintaining the security created by this Agreement (and any supplemental or amendatory agreement thereof) and the other
Finance Documents and preserving of all of the rights, powers and remedies possessed by the Lender thereunder and properly serving, supporting and monitoring their current business relationship as provided in the information brochure “Information for the Processing of Personal Data” (Ενημέρωση για την επεξεργασία δεδομένων προσωπικού χαρακτήρα) which forms an integral part of this Agreement and the Borrower hereby confirms that a
copy of such information brochure has been received by the Borrower, its director(s), officer(s) and legal representative(s) and has been perused, duly understood and fully agreed by each of them.
|
(b) |
Duration of the process: The personal data process shall survive the termination of this Agreement for such
period as it is required by the applicable law.
|
16. |
JOINT AND SEVERAL LIABILITY OF THE BORROWERS
|
16.1 |
Joint and several liability
|
16.2 |
No impairment of Borrowers’ obligations
|
(a) |
this Agreement being or later becoming void, unenforceable or illegal as regards the other Borrower;
|
(b) |
the Lender entering into any rescheduling, refinancing or other arrangement of any kind with the other Borrower;
|
(c) |
the Lender releasing the other Borrower or any Security Interest created by a Finance Document; or
|
(d) |
any time, waiver or consent granted to, or composition with the other Borrower or other person;
|
(e) |
the release of the other Borrower or any other person under the terms of any composition or arrangement with any creditor thereof;
|
(f) |
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, the other Borrower 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;
|
(g) |
any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of the other Borrower or any other person;
|
(h) |
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 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;
|
(i) |
any unenforceability, illegality or invalidity of any obligation or any person under any Finance Document or any other document or security;
|
(j) |
any insolvency or similar proceedings; or
|
(k) |
any combination of the foregoing.
|
16.3 |
Principal debtor
|
16.4 |
Subordination
|
(a) |
claim any amount which may be due to it from the other Borrower whether in respect of a payment made, or matter arising out of, this Agreement or any Finance Document, or any matter unconnected
with this Agreement or any Finance Document; or
|
(b) |
take or enforce any form of security from the other Borrower for such an amount, or in any other way seek to have recourse in respect of such an amount against any asset of the other Borrower; or
|
(c) |
set off such an amount against any sum due from it to the other Borrower; or
|
(d) |
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving the other Borrower or other Security Party; or
|
(e) |
exercise or assert any combination of the foregoing.
|
16.5 |
Borrowers’ required action
|
16.6 |
Deferral of Borrowers’ rights
|
(a) |
to be indemnified by the other Borrower; or
|
(b) |
to claim any contribution from the other Borrower in relation to any payment made by it under the Finance Documents.
|
17. |
NOTICES AND COMMUNICATIONS
|
17.1 |
Notices
|
(a) |
be in writing delivered personally or by first-class prepaid letter (airmail if available), or shall be served through a process server or subject to Clause 10.10 (Communications Indemnity) and Clause 10.11 (Electronic Communication) by
fax or electronic mail;
|
(b) |
be deemed to have been received, subject as otherwise provided in this Agreement or the relevant Finance Document, in the case of fax or electronic mail, at the time of dispatch as per transmission report (provided, in either case, that
if the date of despatch is not a business day in the country of the addressee it shall be deemed to have been received at the opening of business on the next such business day), and in the case of a letter when delivered or served personally
or five (5) days after it has been put into the post; and
|
(c) |
be sent:
|
(i) |
if to be sent to any Security Party, to:
|
(ii) |
if to be sent to the Lender, to
|
17.2 |
Effective date of notices
|
(a) |
a notice which is delivered personally or posted shall be deemed to be served, and shall take effect, at the time when it is delivered; and
|
(b) |
a notice which is sent by fax or electronic mail shall be deemed to be served, and shall take effect, two hours after its transmission is completed.
|
17.3
|
Service outside business hours
|
(a) |
on a day which is not a Banking Day in the place of receipt; or
|
(b) |
on such a Banking Day, but after 5 p.m. local time,
|
17.4 |
Illegible notices
|
17.5
|
Valid notices
|
(a) |
the failure to serve it in accordance with the requirements of this Agreement or other Finance Document, as the case may be, has not caused any party to suffer any significant loss or prejudice; or
|
(b) |
in the case of incorrect and/or incomplete contents, it should have been reasonably clear to the party on which the notice was served what the correct or missing particulars should have been.
|
17.6
|
Effect of electronic communication
|
(a) |
Any communication to be made between any two Parties under or in connection with the Finance Documents may be made by electronic mail or other electronic means (including, without limitation, by way of posting
to a secure website) if those two Parties:
|
(i) |
notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and
|
(ii) |
notify each other of any change to their address or any other such information supplied by them by not less than five Banking Days’ notice.
|
(b) |
Any such electronic communication as specified in paragraph (a) above to be made between a Security Party and the Lender may only be made in that way to the extent that those two Parties agree that, unless and until notified to the
contrary, this is to be an accepted form of communication.
|
(c) |
Any such electronic communication as specified in paragraph (a) above made between any two Parties will be effective only when actually received (or made available) in readable form and in the case of any electronic communication made by a
Party to the Lender only if it is addressed in such a manner as the Lender shall specify for this purpose.
|
(d) |
Any electronic communication which becomes effective, in accordance with paragraph (c) above, after 5.00 p.m. in the place in which the Party to whom the relevant communication is sent or made available has its address for the purpose of
this Agreement shall be deemed only to become effective on the following Banking Day.
|
(e) |
Any reference in a Finance Document to a communication being sent or received shall be construed to include that communication being made available in accordance with this Clause 17.6.
|
18. |
LAW AND JURISDICTION
|
18.1 |
Governing Law
|
(a) |
This Agreement and any non-contractual obligations connected with it shall be governed by and construed in accordance with English Law.
|
(b) |
For the purposes of enforcement in Greece, it is hereby expressly agreed that English law as the governing law of this Agreement will be proved by an affidavit of a solicitor from an English law firm to be appointed by the Lender and the
said affidavit shall constitute full and conclusive evidence binding on the Borrowers but the Borrowers shall be allowed to rebut such evidence save for witness.
|
18.2 |
Jurisdiction
|
(a) |
The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement or any non-contractual obligations connected with it (including a dispute regarding the existence, validity or
termination of this Agreement and including claims arising out of tort or delict) (a “Dispute”).
Each of the Borrowers irrevocably and unconditionally submits to the jurisdiction of such courts.
|
(b) |
The Parties agree that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary and waives any objections to the
inconvenience of England as a forum.
|
(c) |
This Clause 18.2 is for the benefit of the Lender only. As a result, the Lender shall not be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, the Lender may take
concurrent proceedings in any number of jurisdictions.
|
18.3 |
Process Agent for English Proceedings
|
(a) |
each of the Borrowers hereby agrees and undertakes to maintain a Process Agent for English Proceedings throughout the Security Period and hereby agrees that in the event that if any Process Agent for English Proceedings is unable for any
reason to act as agent for service of process, such Borrower must immediately (and in any event within ten (10) days of such event taking place) appoint another agent on terms acceptable to the Lender. Failing this, the Lender may appoint for
this purpose a substitute Process Agent for English Proceedings and the Lender is hereby irrevocably authorised to effect such appointment on Borrowers’ behalf. The appointment of such Process Agent for English Proceedings shall be valid and
binding from the date notice of such appointment is given by the Lender to the Borrowers in accordance with Clause 17.1 (Notices); and
|
(b) |
each of the Borrowers hereby agrees that failure by a Process Agent for English Proceedings to notify the Borrowers of
the process will not invalidate the proceedings concerned.
|
18.4 |
Proceedings in any other country
|
18.5 |
Process Agent (antiklitos) in Greece
|
18.6 |
Third Party Rights
|
18.7 |
Meaning of “proceedings”
|
To:
|
ALPHA BANK S.A.
|
93 Akti Miaouli
|
|
185 38 Piraeus, Greece
|
|
[●] April, 2021 |
Re: |
US$18,000,000 Loan Agreement (the “Loan Agreement”) dated [●] April, 2021 made between (1) the Lender, as lender and (2) (a) Gamora Shipping Co. of the Marshall Islands and Rocket Shipping Co., of the Marshall Islands (the “Borrowers”), as joint and several borrowers.
|
1. |
We refer to the Loan Agreement (terms defined in the Loan Agreement have their defined meanings when used in this Drawdown Notice) and hereby give you notice that we wish to draw the Commitment as follows:
|
(i) |
Loan: the full amount of the Commitment in the amount of US$18,000,000 (Dollars Eighteen million);
|
(ii) |
Drawdown Date: [●] April, 2021;
|
(iii) |
duration of first Interest Period: duration of the first Interest Period in respect of the Loan shall be [●] months;
and
|
(iv) |
Payment instructions: [in payment to the Operating Accounts as per our
instructions under separate cover for the purposes set out in Clause 1.1 (Amount and purpose) of the Loan Agreement].
|
2.
|
We confirm, represent and warrant that:
|
(i) |
no event or circumstance has occurred and is continuing which constitutes a Default or will result from the borrowing of the Loan;
|
(ii) |
the representations and warranties contained in Clause 6 (Representations and warranties) of the Loan Agreement and the representations and warranties contained in each of the other Finance
Documents are true and correct at the date hereof as if made with respect to the facts and circumstances existing at such date;
|
(iii) |
the borrowing to be effected by the drawing of the Loan will be within our corporate powers, has been validly authorised by appropriate corporate action and will not cause any limit on our borrowings (whether imposed by statute,
regulation, agreement or otherwise) to be exceeded;
|
(iv) |
we will not use the Loan proceeds or any part thereof for the purpose of acquiring shares in the share capital of the
Lender or other banks and/or financial institutions or acquiring hybrid capital debentures (τίτλους υβριδικών κεφαλαίων) of the Lender or other banks and/or financial institutions; and
|
(v) |
there has been no change in the ownership, management, operations and no Material Adverse Change in our financial position or in the consolidated financial position of ourselves and the other Security
Parties from that described by us to the Lender in the negotiation of the Loan Agreement.
|
3. |
This Drawdown Notice cannot be revoked without the prior consent of the Lender.
|
SIGNED by
|
)
|
||
Mr.
|
)
|
||
for and on behalf of
|
)
|
||
GAMORA SHIPPING CO.
|
)
|
||
of the Marshall Islands,
|
)
|
|
|
in the presence of:
|
)
|
Attorney-in-fact
|
Witness:
|
|
||
Name:
|
[●]
|
||
Title:
|
Attorney-at-Law
|
||
Address:
|
[●],
|
||
Piraeus, Greece
|
SIGNED by
|
)
|
||
Mr.
|
)
|
||
for and on behalf of
|
)
|
||
ROCKET SHIPPING CO.,
|
)
|
||
of the Marshall Islands,
|
)
|
|
|
in the presence of:
|
)
|
Attorney-in-fact
|
Witness:
|
|||
Name:
|
[●]
|
||
Title:
|
Attorney-at-Law
|
||
Address:
|
[●],
|
||
Piraeus, Greece
|
To:
|
[P&I Club]
|
[●]
|
|
[●]
|
|
From:
|
[●]
|
[●],
|
|
[●]
|
|
[●] 20[●]
|
SIGNED by
|
)
|
||
Mrs. Viktoria Poziopoulou
|
)
|
||
for and on behalf of
|
)
|
||
GAMORA SHIPPING CO.,
|
)
|
|
|
of the Marshall Islands, in the presence of:
|
)
|
Attorney-in-fact
|
Witness:
|
|||
Name:
|
Charalampos V. Sioufas
|
||
Address:
|
13 Defteras Merarchias
|
||
Piraeus, Greece
|
|||
Occupation: Attorney-at-Law
|
SIGNED by
|
)
|
||
Mrs. Viktoria Poziopoulou
|
)
|
||
for and on behalf of
|
)
|
||
ROCKET SHIPPING CO.,
|
)
|
|
|
of the Marshall Islands, in the presence of:
|
)
|
Attorney-in-fact
|
Witness:
|
|
||
Name:
|
Charalampos V. Sioufas
|
||
Address:
|
13 Defteras Merarchias
|
||
Piraeus, Greece
|
|||
Occupation: Attorney-at-Law
|
SIGNED by
|
)
|
||
Mr. Konstantinos Sotiriou and
|
)
|
|
|
Mrs. Chrysanthi Papathanasopoulou
|
)
|
Attorney-in-fact
|
|
for and on behalf of
|
)
|
||
ALPHA BANK S.A.,
|
)
|
||
of Greece,
|
)
|
||
in the presence of:
|
)
|
|
|
Attorney-in-fact
|
Witness:
|
|||
Name:
|
Charalampos V. Sioufas
|
||
Address:
|
13 Defteras Merarchias
|
||
Piraeus, Greece
|
|||
Occupation: Attorney-at-Law
|
Clause | Page | |
Interpretation
|
1
|
|
2
|
Facility
|
24
|
3
|
Position of the Lenders
|
24
|
4
|
Drawdown
|
25
|
5
|
Interest
|
26
|
6
|
Interest Periods
|
28
|
7
|
Default Interest
|
29
|
8
|
Repayment and Prepayment
|
30
|
9
|
Conditions Precedent
|
34
|
10
|
Representations and Warranties
|
35
|
11
|
General Undertakings
|
39
|
12
|
Corporate Undertakings
|
46
|
13
|
Insurance
|
47
|
14
|
Ship Covenants
|
54
|
15
|
Security Cover
|
60
|
16
|
Payments and Calculations
|
62
|
17
|
Application of Receipts
|
64
|
18
|
Application of Earnings
|
65
|
19
|
Events of Default
|
68
|
20
|
Fees and Expenses
|
73
|
21
|
Indemnities
|
74
|
22
|
No Set-Off or Tax Deduction
|
77
|
23
|
Illegality, etc.
|
80
|
24
|
Increased Costs
|
80
|
25
|
Set-Off
|
82
|
26
|
Transfers and Changes in Lending Offices
|
83
|
27
|
Variations and Waivers
|
88
|
28
|
Notices
|
91
|
29
|
Joint and Several Liability
|
94
|
30
|
Supplemental
|
95
|
31
|
Bail-In
|
96
|
32
|
Law and Jurisdiction
|
96
|
Schedules
|
||
Schedule 1 Lenders and Commitments
|
98
|
|
Schedule 2 Drawdown Notice
|
99
|
|
Schedule 3 Condition Precedent Documents
|
100
|
|
Part A
|
100
|
|
Part B
|
102
|
|
Schedule 4 Mandatory Cost Formula
|
104
|
|
Schedule 5 Transfer Certificate
|
106
|
|
Schedule 6 Power of Attorney
|
110
|
|
Schedule 7 Form of Compliance Certificate
|
111
|
|
Execution
|
||
Execution Pages
|
112
|
(2) |
THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1 (Lenders and Commitments), as Lenders;
|
(3) |
HAMBURG COMMERCIAL BANK AG acting through its office at Gerhart-Hauptmann-Platz 50, 20095 Hamburg, Germany, as Agent;
|
(4) |
HAMBURG COMMERCIAL BANK AG acting through its office at Gerhart-Hauptmann-Platz 50, 20095 Hamburg, Germany, as Mandated Lead Arranger;
|
(5) |
HAMBURG COMMERCIAL BANK AG acting through its office at Gerhart-Hauptmann-Platz 50, 20095 Hamburg, Germany, as Security Trustee.
|
(A) |
The Lenders have agreed to make available to the Borrowers a secured term loan facility of up to US$40,750,000 in four advances as follows:
|
(i) |
an advance in an amount of up to the lesser of (AA) US$10,750,000 and (BB) 50 per cent. of the Initial Market Value of Ship A;
|
(ii) |
an advance in an amount of up to the lesser of (AA) US$10,000,000 and (BB) 50 per cent. of the Initial Market Value of Ship B;
|
(iii) |
an advance in an amount of up to the lesser of (AA) US$10,000,000 and (BB) 50 per cent. of the Initial Market Value of Ship C; and
|
(iv) |
an advance in an amount of up to the lesser of (AA) US$10,000,000 and (BB) 50 per cent. of the Initial Market Value of Ship D,
|
1 |
INTERPRETATION
|
1.1 |
Definitions
|
(a) |
Pavimar S.A. a corporation incorporated and existing in the Republic of the Marshall Islands whose registered address is at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960;
|
(b) |
Castor Ships;
|
(c) |
or any other company which the Agent (acting on the instructions of the Majority Lenders) may approve from time to time as the commercial and/or
technical manager of that Ship.
|
(a) |
30 August 2021 (or such later date as the Agent may, with the authorisation of the Lenders, agree with the Borrowers); or
|
(b) |
if earlier, the date on which the Total Commitments are fully borrowed, cancelled or terminated.
|
(c) |
in relation to the United Kingdom, the UK Bail-In Legislation.
|
(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;
|
(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; and
|
(c) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”.
|
(a) |
in Hamburg and London regarding the fixing of any interest rate which is required to be determined under this Agreement or any Finance Document;
|
(b) |
in Hamburg, Athens and New York in respect of any payment which is required to be made under a Finance Document; and
|
(c) |
in Hamburg, Athens and Limassol regarding any other action to be taken under this Agreement or any other Finance Document.
|
(a) |
in relation to a Security Party (other than the Corporate Guarantor and Castor Ships) or a Borrower, a change in:
|
(i) |
the ultimate beneficial ownership of any of the shares in that Security Party; or
|
(ii) |
the ultimate control of the voting rights attaching to any of those shares; or
|
(iii) |
the legal ownership of any of those shares; and
|
(b) |
(c) |
For the purpose of sub-paragraphs (b) above “control” means the power (whether by way of ownership of shares, proxy, contract,
agency or otherwise) to:
|
(i) |
cast, or control the casting of, more than 50 per cent. of the maximum number of votes that might be cast at a general meeting of the Corporate Guarantor; or
|
(ii) |
appoint or remove all, or the majority, of the directors or other equivalent officers of the Corporate Guarantor; or
|
(iii) |
give directions with respect to the operating and financial policies of the Corporate Guarantor with which the directors or other equivalent officers of the Corporate
Guarantor are obliged to comply; and/or
|
(b) |
(i) |
from performing its payment obligations under the Finance Documents; or
|
(ii) |
(a) |
except to the extent that they fall within paragraph (b);
|
(i) |
all freight, hire and passage moneys;
|
(ii) |
compensation payable to that Borrower or the Security Trustee in the event of requisition of a Ship for hire;
|
(iii) |
remuneration for salvage and towage services;
|
(iv) |
demurrage and detention moneys;
|
(v) |
damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of that Ship; and
|
(vi) |
all moneys which are at any time payable under any Insurances in respect of loss of hire; and
|
(a) |
any claim by any governmental, judicial or regulatory authority which arises out of an Environmental Incident or an alleged Environmental Incident or which relates to any
Environmental Law; or
|
(b) |
any claim by any other person which relates to an Environmental Incident or to an alleged Environmental Incident,
|
(a) |
any release of Environmentally Sensitive Material from that Ship; or
|
(a) |
(a) |
this Agreement;
|
(b) |
the Agency and Trust Agreement;
|
(c) |
the Account Pledges;
|
(d) |
the Corporate Guarantee;
|
(e) |
any Subordination Agreement;
|
(f) |
any Subordinated Debt Security;
|
(g) |
the Mortgages;
|
(h) |
the General Assignments;
|
(i) |
any Charterparty Assignments;
|
(j) |
the Approved Manager’s Undertakings;
|
(k) |
the Side Letter; and
|
(a) |
for principal, interest or any other sum payable in respect of any moneys borrowed or raised by the debtor;
|
(b) |
under any loan stock, bond, note or other security issued by the debtor;
|
(c) |
under any acceptance credit, guarantee or letter of credit facility made available to the debtor;
|
(f) |
under receivables sold or discounted (other than any receivables to the extent that they are sold on a non-recourse basis); or
|
(a) |
the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than that Interest Period; and
|
(b) |
the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds that Interest Period,
|
(b) |
(if no Screen Rate is available for that Interest Period), the applicable Interpolated Screen Rate for that Interest Period; or
|
(a) |
before an Advance is made, Lenders whose Commitments total 66 2/3 per cent. of the Total Commitments;
and
|
(b) |
after an Advance is made, Lenders whose Contributions total 66 2/3 per cent. of the Loan.
|
(a) |
the business, property, assets, liabilities, operations or condition (financial or otherwise) of a Borrower and/or any Security Party taken as a whole;
|
(b) |
the ability of a Borrower and/or any Security Party to (i) comply with or perform any of its obligations or (ii) discharge any of its liabilities, under any Finance Document as they
fall due; or
|
(c) |
the validity, legality or enforceability of any Finance Document.
|
(a) |
(b) |
in respect of each of Advance B, Advance C and Advance D, an amount up to the lesser of (i) $10,000,000 and (ii) 50 per cent. of the Initial Market Value of the Ship
to which that Advance relates.
|
(a) |
Security Interests created by the Finance Documents;
|
(b) |
liens for unpaid master’s and crew’s wages in accordance with usual maritime practice;
|
(c) |
liens for salvage;
|
(d) |
liens arising by operation of law for not more than one month’s prepaid hire under any charter in relation to a Ship not prohibited by this Agreement;
|
(a) |
any Finance Document;
|
(b) |
(c) |
any other document contemplated by or referred to in any Finance Document; and
|
(a) |
England and Wales;
|
(b) |
the country under the laws of which the company is incorporated or formed;
|
(c) |
a country in which the company has the centre of its main interests or which the company’s central management and control is or has recently been exercised;
|
(d) |
a country in which the overall net income of the company is subject to corporation tax, income tax or any similar tax;
|
(a) |
any transaction or matter contemplated by, arising out of, or in connection with a Pertinent Document; or
|
(b) |
any statement relating to a Pertinent Document or to a transaction or matter falling within paragraph (a),
|
(a) |
formally designated, nominated or recommended as the replacement for a Screen Rate by:
|
(i) |
the administrator of that Screen Rate (provided that the market or economic reality that such benchmark rate measures is the same as that measured by that Screen Rate); or
|
(ii) |
any Relevant Nominating Body,
|
(b) |
in the opinion of the Lenders, generally accepted in the international or any relevant domestic syndicated loan markets as the appropriate successor to a Screen Rate; or
|
(c) |
in the opinion of the Lenders, an appropriate successor to a Screen Rate.
|
(a) |
the methodology, formula or other means of determining that Screen Rate has, in the opinion of the Lenders, materially changed;
|
(i) |
(A) |
the administrator of that Screen Rate or its supervisor publicly announces that such administrator is insolvent; or
|
(iii) |
the supervisor of the administrator of that Screen Rate publicly announces that such Screen Rate has been or will be permanently or indefinitely discontinued; or
|
(iv) |
the administrator of that Screen Rate or its supervisor announces that that Screen Rate may no longer be used; or
|
(i) |
the circumstance(s) or event(s) leading to such determination are not (in the opinion of the Lenders) temporary; or
|
(ii) |
that Screen Rate is calculated in accordance with any such policy or arrangement for a period no less than 15 Business Days; or
|
(d) |
in the opinion of the Lenders, that Screen Rate is otherwise no longer appropriate for the purposes of calculating interest under this Agreement.
|
(a) |
a mortgage, charge (whether fixed or floating) or pledge, any maritime or other lien or any other security interest of any kind;
|
(b) |
the rights of a plaintiff under an action in rem; and
|
(a) |
the Corporate Guarantor;
|
(b) |
Castor Ships;
|
(c) |
Pavimar S.A.; and
|
(d) |
any other person (except a Creditor Party and any other manager which is not a member of the Group) who, as a surety or mortgagor, as a party to
any subordination or priorities arrangement, or in any similar capacity, executes a document falling within the final paragraph of the definition of “Finance Documents”.
|
(a) |
all amounts which have become due for payment by a Borrower or any Security Party under the Finance Documents have been paid;
|
(b) |
no amount is owing or has accrued (without yet having become due for payment) under any Finance Document;
|
(c) |
(a) |
actual, constructive, compromised, agreed or arranged total loss of that Ship;
|
(c) |
any condemnation of that Ship by any tribunal or by any person or person claiming to be a tribunal; and
|
(a) |
in the case of an actual loss of that Ship, the date on which it occurred or, if that is unknown, the date when that Ship was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of that Ship, the earlier of:
|
(i) |
the date on which a notice of abandonment is given to the insurers; and
|
(c) |
in the case of any other type of total loss, on the date (or the most likely date) on which it appears to the Agent that the event constituting the total loss occurred.
|
(a) |
a Borrower which is resident for tax purposes in the US; or
|
(b) |
a Borrower or a Security Party some or all whose payments under the Finance Documents are from sources within the US for US federal income tax purposes.
|
(b) |
in relation to any other applicable Bail-In Legislation other than the UK Bail-In Legislation:
|
(ii) |
1.2 |
Construction of certain terms
|
1.3 |
Meaning of “month”
|
1.4 |
Meaning of “subsidiary”
|
(b) |
P has direct or indirect control over a majority of the voting rights attaching to the issued shares of S; or
|
(c) |
P has the direct or indirect power to appoint or remove a majority of the directors of S; or
|
(d) |
P otherwise has the direct or indirect power to ensure that the affairs of S are conducted in accordance with the wishes of P,
|
1.5 |
General Interpretation
|
(a) |
references to, or to a provision of, a Finance Document or any other document are references to it as amended or supplemented, whether before the date of this Agreement or otherwise;
|
(b) |
references to, or to a provision of, any law include any amendment, extension, re-enactment or replacement, whether made before the date of this Agreement or otherwise;
|
(c) |
words denoting the singular number shall include the plural and vice versa; and
|
(d) |
1.6 |
Headings
|
2 |
FACILITY
|
2.1 |
Amount of facility
|
2.2 |
Lenders’ participations in Advances
|
2.3 |
Purpose of Advances
|
3 |
POSITION OF THE LENDERS
|
3.1 |
Interests several
|
3.2 |
Individual right of action
|
3.3 |
Proceedings requiring Majority Lender consent
|
3.4 |
Obligations several
|
(a) |
the obligations of the other Lenders being increased; nor
|
(b) |
a Borrower, any Security Party, any other Lender being discharged (in whole or in part) from its obligations under any Finance Document;
|
4 |
DRAWDOWN
|
4.1 |
Request for an Advance
|
4.2 |
Availability
|
(a) |
(b) |
each Advance shall not exceed the relevant Maximum Advance Amount;
|
(c) |
all Advances shall be drawn down on the same Drawdown Date;
|
(d) |
any undrawn portion of the Total Commitments in respect of an Advance to occur, upon the determination of the Initial Market Value of the Ship to which that Advance relates, shall be
automatically cancelled as at the Drawdown Date of that Advance; and
|
(e) |
the aggregate amount of the Advances shall not exceed the Total Commitments.
|
4.3 |
Notification to Lenders of receipt of a Drawdown Notice
|
(a) |
the amount of the Advance to which that Drawdown Notice relates and the relevant Drawdown Date;
|
(b) |
the amount of that Lender’s participation in that Advance; and
|
(c) |
the duration of the first Interest Period in respect of that Advance.
|
4.4 |
Drawdown Notice irrevocable
|
4.5 |
Lenders to make available Contributions
|
4.6 |
Disbursement of Advance
|
(a) |
to the account which the Borrowers specify in the Drawdown Notice; and
|
(b) |
in like funds as the Agent received the payments from the Lenders.
|
5 |
INTEREST
|
5.1 |
Payment of normal interest
|
5.2 |
Normal rate of interest
|
5.3 |
Payment of accrued interest
|
5.4 |
Notification of Interest Periods and rates of normal interest
|
(a) |
each rate of interest; and
|
(b) |
the duration of each Interest Period,
|
5.5 |
Obligation of Reference Banks to quote
|
5.6 |
Absence of quotations by Reference Banks
|
5.7 |
Market disruption
|
5.8 |
Notification of market disruption
|
5.9 |
Suspension of drawdown
|
(a) |
in a case falling within Clause 5.7(a) (Market disruption), the Lenders’ obligation to advance that Advance; and
|
(b) |
in a case falling within Clause 5.7(b) (Market disruption), the Affected Lender’s obligation to participate in that Advance,
|
5.10 |
Negotiation of alternative rate of interest
|
5.11 |
Application of agreed alternative rate of interest
|
5.12 |
Alternative rate of interest in absence of agreement
|
5.13 |
Notice of prepayment
|
5.14 |
Prepayment; termination of Commitments
|
(a) |
on the date on which the Agent serves that notice, the Total Commitments shall be cancelled; and
|
5.15 |
Application of prepayment
|
6 |
INTEREST PERIODS
|
6.1 |
Commencement of Interest Periods
|
6.2 |
Duration of normal Interest Periods
|
(a) |
3 months; or
|
6.3 |
Duration of Interest Periods for Instalments
|
6.4 |
Non-availability of matching deposits for Interest Period selected
|
7 |
DEFAULT INTEREST
|
7.1 |
Payment of default interest on overdue amounts
|
(a) |
the date on which the Finance Documents provide that such amount is due for payment; or
|
(b) |
if a Finance Document provides that such amount is payable on demand, the date on which the demand is served; or
|
(c) |
if such amount has become immediately due and payable under Clause 19.4 (Acceleration of Loan), the date on which it became immediately due
and payable.
|
7.2 |
Default rate of interest
|
(a) |
(b) |
7.3 |
Calculation of default rate of interest
|
(a) |
the rate applicable to the overdue principal amount immediately prior to the relevant date (but only for any unexpired part of any then current Interest Period applicable to it);
|
(i) |
LIBOR; or
|
7.4 |
Notification of interest periods and default rates
|
7.5 |
Payment of accrued default interest
|
7.6 |
Compounding of default interest
|
8 |
REPAYMENT AND PREPAYMENT
|
8.1 |
Amount of Instalments
|
(a) |
Advance A, by:
|
(i) |
20 equal consecutive quarterly instalments, each in the amount of $283,000 (each an “Instalment A” and, together, the “Instalments A”); and
|
(ii) |
a balloon instalment in the amount of $5,090,000 (the “Balloon Instalment A”); and
|
(b) |
Advance B, by:
|
(i) |
20 equal consecutive quarterly instalments (each an “Instalment B” and, together, the “Instalments B”), each in the amount of $299,000; and
|
(ii) |
a balloon instalment (the “Balloon Instalment B”) in the amount of $4,020,000,
|
(c) |
Advance C, by:
|
(i) |
20 equal consecutive quarterly instalments (each an “Instalment C” and, together, the “Instalments C”), each in the amount of $273,000; and
|
(ii) |
a balloon instalment (the “Balloon Instalment C”) in the amount of $4,540,000,
|
(d) |
Advance D, by:
|
(i) |
20 equal consecutive quarterly instalments (each an “Instalment D” and, together, the “Instalments
D” and, together with the Instalments A, the Instalments B and the Instalments C, the “Instalments” and each an “Instalment”), each in the amount of
$299,000; and
|
(ii) |
a balloon instalment (the “Balloon Instalment D” and, together with the Balloon Instalment A, the Balloon Instalment B and the
Balloon Instalment C the “Balloon Instalments” and each a “Balloon Instalment”) in the amount of $4,020,000,
|
8.2 |
Repayment Dates
|
8.3 |
Final Repayment Date
|
8.4 |
Voluntary prepayment
|
8.5 |
Conditions for voluntary prepayment
|
(a) |
a partial prepayment shall be in an amount equal to an Instalment or a higher integral multiple thereof;
|
(d) |
the Borrowers are in compliance with Clause 8.10 (Amounts payable on prepayment) on or prior to the date of prepayment.
|
8.6 |
Optional facility cancellation
|
8.7 |
Cancellation Notice or Prepayment Notice
|
8.8 |
Mandatory prepayment
|
(a) |
The Borrowers shall be obliged to prepay the Relevant Amount if a Ship:
|
(i) |
(i) |
the Advance to which the Ship being sold or which has become a Total Loss relates; and
|
8.9 |
Effect of Prepayment Notice and Cancellation Notice
|
(b) |
in the case of a Cancellation Notice, the amount cancelled shall be permanently cancelled and may not be borrowed.
|
8.10 |
Amounts payable on prepayment
|
8.11 |
Application of partial prepayment or cancellation
|
8.12 |
No reborrowing
|
9 |
CONDITIONS PRECEDENT
|
9.1 |
Documents, fees and no default
|
(a) |
(b) |
that, on the Drawdown Date but prior to the making of the Advance, the Agent receives;
|
(i) |
(ii) |
in the case of the first Drawdown Notice to be served under this Agreement, the structuring fee payable pursuant to Clause 20.1(a) (Structuring and
commitment fees);
|
(iii) |
payment of any commitment fee payable pursuant to Clause 20.1(b) (Structuring and commitment fees); and
|
(iv) |
payment of any expenses payable pursuant to Clause 20.2 (Costs of negotiation, preparation etc.) which are due and payable on the Drawdown
Date to which that Drawdown Notice relates;
|
(c) |
that both at the date of each Drawdown Notice and at the relevant Drawdown Date:
|
(i) |
no Event of Default or Potential Event of Default has occurred or would result from the borrowing of the relevant Advance;
|
(iii) |
none of the circumstances contemplated by Clause 5.7 (Market disruption) has occurred and is continuing; and
|
(iv) |
there has been no Material Adverse Change; and
|
9.2 |
Waiver of conditions precedent
|
10 |
REPRESENTATIONS AND WARRANTIES
|
10.1 |
General
|
10.2 |
Status
|
10.3 |
Share capital and ownership
|
10.4 |
Corporate power
|
(a) |
to execute the Underlying Documents to which it is a party and to maintain its Ship in its ownership under the applicable Approved Flag;
|
(b) |
to execute the Finance Documents to which that Borrower is a party; and
|
(c) |
to borrow under this Agreement and to make all the payments contemplated by, and to comply with, those Finance Documents to which that Borrower is a party.
|
10.5 |
Consents in force
|
10.6 |
Legal validity; effective Security Interests
|
(a) |
constitute that Borrower’s legal, valid and binding obligations enforceable against that Borrower in accordance with their respective terms; and
|
10.7 |
No third party Security Interests
|
(a) |
that Borrower will have the right to create all the Security Interests which that Finance Document purports to create; and
|
10.8 |
No conflicts
|
(a) |
will not involve or lead to a contravention of:
|
(i) |
any law or regulation; or
|
(ii) |
the constitutional documents of that Borrower or other Security Party; or
|
(iii) |
any contractual or other obligation or restriction which is binding on that Borrower or other Security Party or any of its assets, and
|
(b) |
will not have a Material Adverse Effect; and
|
(c) |
is for the corporate benefit of that Borrower or each other Security Party.
|
10.9 |
No withholding taxes
|
10.10 |
No default
|
10.11 |
Information
|
10.12 |
No litigation
|
10.13 |
(a) |
(b) |
10.14 |
Compliance with certain undertakings
|
10.15 |
No rebates etc.
|
10.16 |
Taxes paid
|
10.17 |
ISM Code and ISPS Code compliance
|
10.18 |
No Money laundering
|
10.19 |
No immunity
|
10.20 |
Choice of law
|
10.21 |
Pari passu ranking
|
10.22 |
Repetition
|
(a) |
on the date of service of each Drawdown Notice;
|
(b) |
on each Drawdown Date; and
|
(c) |
11 |
GENERAL UNDERTAKINGS
|
11.1 |
General
|
11.2 |
Title and negative pledge
|
(b) |
not create or permit to arise any Security Interest (except for Permitted Security Interests) over any other asset, present or future.
|
11.3 |
No disposal of assets
|
(a) |
all or a substantial part of its assets, whether by one transaction or a number of transactions, whether related or not; or
|
(b) |
any debt payable to it or any other right (present, future or contingent right) to receive a payment, including any right to damages or compensation,
|
11.4 |
No other liabilities or obligations to be incurred
|
(a) |
liabilities and obligations under the Finance Documents and the Underlying Documents to which it is or, as the case may be, will be a party; and
|
11.5 |
Information provided to be accurate
|
11.6 |
Provision of financial statements
|
11.7 |
Form of financial statements
|
(a) |
(c) |
fully disclose or provide for all significant liabilities of each Borrower, the Corporate Guarantor and the Group and each of its subsidiaries.
|
11.8 |
Shareholder and creditor notices
|
11.9 |
Consents
|
(a) |
for that Borrower to perform its obligations under any Finance Document or any Underlying Document to which it is a party;
|
(b) |
for the validity or enforceability of any Finance Document or any Underlying Document to which it is a party;
|
(c) |
for that Borrower to continue to own and operate the Ship owned by it,
|
11.10 |
Maintenance of Security Interests
|
(a) |
at its own cost, do all that it reasonably can to ensure that any Finance Document validly creates the obligations and the Security Interests which it purports to create; and
|
11.11 |
Notification of litigation
|
11.12 |
No amendment to Underlying Documents
|
11.13 |
Principal place of business
|
11.14 |
Confirmation of no default
|
(a) |
states that no Event of Default or Potential Event of Default has occurred; or
|
(b) |
states that no Event of Default or Potential Event of Default has occurred, except for a specified event or matter, of which all material details are given.
|
11.15 |
Notification of default
|
(a) |
the occurrence of an Event of Default or a Potential Event of Default; or
|
(b) |
any matter which indicates that an Event of Default or a Potential Event of Default may have occurred,
|
11.16 |
Provision of further information
|
(a) |
to that Borrower, the Ship owned by it, the Earnings or the Insurances; or
|
(b) |
to any other matter relevant to, or to any provision of, a Finance Document,
|
11.17 |
Provision of copies and translation of documents
|
11.18 |
“Know your customer” checks
|
(a) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
|
(b) |
any change in the composition of the shareholders of the Borrowers or any Security Party (other than Castor Ships) after the date of this Agreement; or
|
(c) |
a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer,
|
11.19 |
Minimum Liquidity and Additional Minimum Liquidity
|
(a) |
Subject to paragraph (c) below, the Borrowers shall maintain in the Liquidity Account:
|
(i) |
credit balances in an aggregate amount of not less than $350,000 in respect of each Mortgaged Ship ($1,400,000 in aggregate) (“Minimum Liquidity”) commencing from the Drawdown Date and at all times thereafter throughout the remainder of the Security Period;
|
(ii) |
in addition to the amount required to be maintained under paragraph (a) of this Clause 11.19 (Minimum Liquidity and Additional
Minimum Liquidity), an aggregate amount of not less than $250,000 in respect of each Mortgaged Ship ($1,000,000 in aggregate, the “Additional Minimum Liquidity”) commencing from the Drawdown
Date and at all times thereafter up to the Repayment Date of the fourth Instalment in relation to each Advance, at which time, the Additional Minimum Liquidity shall be released upon written request to or to the order of the Borrowers
(following the full repayment of the fourth Instalment in respect of each Advance) subject to the terms of paragraph (c) below.
|
(b) |
The Liquidity Account shall be secured under the applicable Account Pledge and remain blocked.
|
(A) |
no Event of Default has occurred at the relevant time; and
|
(B) |
that part of the Additional Minimum Liquidity which is released from the Liquidity Account (the “Released Amount”) pursuant to
this Clause 11.19 (Minimum Liquidity and Additional Minimum Liquidity) is utilised by the relevant Borrower only for the purpose of paying the Debt Service; and
|
(C) |
that Borrower provides the Agent with the most recent quarterly management accounts evidencing such Cash Shortfall.
|
(d) |
In this Clause 11.19 (Minimum Liquidity and Additional Minimum Liquidity):
|
11.20 |
Dry Docking Reserve Amount
|
(a) |
Each Borrower undertakes with each Creditor Party that, from the date falling three months after the Drawdown Date and at quarterly intervals thereafter during the Security Period, in
respect of each Mortgaged Ship, an amount of $20,000 per Ship ($80,000 in aggregate) (collectively, the “Dry Docking Reserve
Amount”) is deposited to the Dry Dock Reserve Account.
|
(b) |
The Dry Dock Reserve Account shall be secured under the Account Pledge and, subject to paragraph (d) below, remain blocked thereon.
|
(c) |
(B) |
no Event of Default or Potential Event of Default having occurred and being continuing at the relevant time or resulting from the release of the Dry Docking Reserve
Amount.
|
11.21 |
Compliance Certificate
|
11.22 |
No Money laundering
|
(a) |
Each Borrower:
|
(ii) |
(b) |
Each Borrower:
|
(ii) |
will promptly inform the Agent by written notice, if it is not or ceases to be the beneficiary and will provide in writing the name and address of the beneficiary.
|
(c) |
12 |
CORPORATE UNDERTAKINGS
|
12.1 |
General
|
12.2 |
Maintenance of status
|
12.3 |
Negative undertakings
|
(a) |
change the nature of its business or carry on any business other than the ownership, chartering and operation of the Ship owned by it;
|
(i) |
pay any dividend or make any other form of distribution if:
|
(A) |
an Event of Default or a Potential Event of Default has occurred and is continuing at the relevant time; or
|
(B) |
an Event of Default will result from the payment of a dividend or the making of any other form of distribution,
|
(A) |
no Event of Default or a Potential Event of Default has occurred and is continuing at the relevant time; or
|
(B) |
no Event of Default will result from the payment of a dividend or the making of any other form of distribution; and
|
(c) |
effect any form of redemption, purchase or return of its issued shares;
|
(d) |
repay any Subordinated Debt;
|
(e) |
provide any form of credit or financial assistance (including any guarantee or indemnity) to:
|
(i) |
a person who is directly or indirectly interested in that Borrower’s share or loan capital; or
|
(ii) |
any company in or with which such a person is directly or indirectly interested or connected,
|
(f) |
enter into any material agreement other than:
|
(i) |
the Finance Documents and the Underlying Documents; or
|
(ii) |
any other agreement expressly allowed under any other term of this Agreement;
|
(g) |
open or maintain any account with any bank or financial institution except accounts with the Agent, the Account Bank and the Security Trustee for the purposes of the Finance
Documents;
|
(h) |
issue, allot or grant any person a right to any shares in its capital or repurchase or reduce its issued shares and/or number of shares it is authorised to issue;
|
(i) |
change its Financial Year;
|
(k) |
allow a Change of Control; or
|
(l) |
enter into any form of amalgamation, merger or de-merger, acquisition, divesture, split-up or any form of reconstruction or reorganisation.
|
12.4 |
13 |
INSURANCE
|
13.1 |
General
|
13.2 |
Maintenance of obligatory insurances
|
(a) |
fire and usual marine risks (including hull and machinery and excess risks);
|
(b) |
war risks (including, without limitation, protection and indemnity war risks with a separate limit not less than hull value of the relevant Ship);
|
13.3 |
Terms of obligatory insurances
|
(a) |
in Dollars;
|
(b) |
(i) |
an amount which is equal to 120 per cent. of the aggregate of:
|
(A) |
the Advance relating to the Ship owned by it: and
|
(B) |
the aggregate principal amount secured by Permitted Security Interests over that Ship which have a prior ranking to the Security Interests created by the Finance Documents; and
|
(ii) |
the Market Value of that Ship;
|
(d) |
in relation to protection and indemnity risks in respect of the full value and tonnage of that Ship;
|
(e) |
in relation to war risks insurance, extended to cover piracy and terrorism where excluded under the fire and usual marine risks insurance;
|
(f) |
on approved terms and conditions;
|
(g) |
such other risks of whatever nature and howsoever arising in respect of which insurance would be maintained by a prudent owner of a vessel similar to that Ship; and
|
(h) |
through approved brokers and with approved insurance companies and/or underwriters which have a Standard & Poor’s rating of at least BBB- or a comparable rating by any other
rating agency acceptable to the Security Trustee (acting on the instructions of the Majority Lenders) or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks associations
which are members of the International Group of Protection and Indemnity Clubs.
|
13.4 |
Further protections for the Creditor Parties
|
(d) |
the obligatory insurances shall name the Security Trustee as sole loss payee with such directions for payment as the Security Trustee may specify;
|
(h) |
the obligatory insurances shall provide that the Security Trustee may make proof of loss if that Borrower fails to do so; and
|
13.5 |
Renewal of obligatory insurances
|
(a) |
at least 14 days before the expiry of any obligatory insurance effected by it:
|
(ii) |
seek the Security Trustee’s approval to the matters referred to in paragraph (i);
|
(b) |
at least 7 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the Security Trustee’s approval pursuant to paragraph (a); and
|
13.6 |
Copies of policies; letters of undertaking
|
(a) |
(b) |
they will hold such policies, and the benefit of such insurances, to the order of the Security Trustee in accordance with the said loss payable clause;
|
(c) |
they will advise the Security Trustee immediately of any material change to the terms of the obligatory insurances;
|
13.7 |
Copies of certificates of entry; letters of undertaking
|
(a) |
a certified copy of the certificate of entry for that Ship;
|
(b) |
a letter or letters of undertaking in such form as may be required by the Security Trustee;
|
13.8 |
Deposit of original policies
|
13.9 |
Payment of premiums
|
13.10 |
Guarantees
|
13.11 |
Compliance with terms of insurances
|
(b) |
not make any changes relating to the classification or classification society or manager or operator of the Ship owned by it approved by the underwriters of the obligatory insurances;
|
13.12 |
Alteration to terms of insurances
|
13.13 |
Settlement of claims
|
13.14 |
Provision of copies of communications
|
(a) |
the approved brokers;
|
(b) |
the approved protection and indemnity and/or war risks associations; and
|
(c) |
the approved insurance companies and/or underwriters, which relate directly or indirectly to:
|
(i) |
that Borrower’s obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls;
|
(iii) |
a claim under any Insurances.
|
13.15 |
Provision of information and further undertakings
|
(a) |
obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
|
(b) |
13.16 |
Mortgagee’s interest and additional perils insurances
|
(iii) |
(A) |
the Advance relating to the Ship owned by it: and
|
(B) |
the aggregate principal amount secured by Permitted Security Interests over that Ship which have a prior ranking to the Security Interests created by the Finance Documents,
|
13.17 |
Review of insurance requirements
|
13.18 |
Modification of insurance requirements
|
13.19 |
Compliance with mortgagee’s instructions
|
14 |
SHIP COVENANTS
|
14.1 |
General
|
14.2 |
Ship’s name and registration
|
14.3 |
Repair and classification
|
(a) |
consistent with first-class ship ownership and management practice;
|
14.4 |
Classification society undertaking
|
(c) |
to notify the Security Trustee immediately in writing if the classification society:
|
(i) |
receives notification from that Borrower or any person that that Ship’s classification society is to be changed; or
|
(d) |
following receipt of a written request from the Security Trustee:
|
14.5 |
Modification
|
14.6 |
Removal of parts
|
14.7 |
Surveys
|
14.8 |
Inspection
|
14.9 |
Prevention of and release from arrest
|
(a) |
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against the Ship owned by it, the Earnings or the Insurances;
|
(b) |
all taxes, dues and other amounts charged in respect of that Ship, the Earnings or the Insurances; and
|
(c) |
all other outgoings whatsoever in respect of that Ship, the Earnings or the Insurances,
|
14.10 |
Compliance with laws etc.
|
14.11 |
Provision of information
|
(a) |
the Ship owned by it, its employment, position and engagements;
|
(b) |
the Earnings and payments and amounts due to the master and crew of that Ship;
|
(c) |
any expenses incurred, or likely to be incurred, in connection with the operation, maintenance or repair of that Ship and any payments made in respect of that Ship;
|
(d) |
any towages and salvages; and
|
(e) |
its compliance, each Approved Manager’s compliance and the compliance of that Ship with the ISM Code and the ISPS Code,
|
14.12 |
Notification of certain events
|
(a) |
before entering into:
|
(i) |
any demise charter for any period in respect of its Ship; or
|
(ii) |
any other Assignable Charter,
|
(D) |
the relevant Borrower provides certified true and complete copies of the charter relating to its Ship and of any current charter guarantee, if any, immediately after its execution;
|
(F) |
(b) |
immediately notify the Security Trustee by letter, of:
|
(ii) |
its entry into any time or consecutive voyage charter in respect of that Ship for a term which exceeds, or which by virtue of any optional extensions may exceed, six months;
|
(iii) |
any casualty which is or is likely to be or to become a Major Casualty;
|
(iv) |
any occurrence as a result of which the Ship owned by it has become or is, by the passing of time or otherwise, likely to become a Total Loss;
|
(v) |
any requirement, condition or recommendation made by any insurer or classification society or by any competent authority which is not immediately complied with;
|
(vi) |
any arrest or detention of that Ship, any exercise or purported exercise of any lien on that Ship or its Earnings or any requisition of that Ship for hire;
|
(vii) |
any intended dry docking of that Ship;
|
(viii) |
any Environmental Claim which exceeds $1,000,000 and made against that Borrower or in connection with that Ship, or any Environmental Incident;
|
(ix) |
any claim for breach of the ISM Code or the ISPS Code being made against that Borrower, any Approved Manager or otherwise in connection with that Ship;
|
(x) |
its intention to de-activate or lay up its Ship; or
|
(xi) |
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with,
|
14.13 |
Restrictions on chartering, appointment of managers etc.
|
(a) |
enter into any charter in relation to that Ship under which more than two months’ hire (or the equivalent) is payable in advance;
|
(b) |
charter that Ship otherwise than on bona fide arm’s length terms at the time when that Ship is fixed;
|
(c) |
appoint a manager of that Ship other than the Approved Managers or agree to any alteration to the terms of any Approved Manager’s appointment; or
|
14.14 |
Notice of Mortgage
|
14.15 |
Sharing of Earnings
|
14.16 |
ISPS Code
|
(a) |
procure that the Ship owned by it and the company responsible for that Ship’s compliance with the ISPS Code comply with the ISPS Code; and
|
(b) |
maintain for that Ship an ISSC; and
|
(c) |
notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
|
15 |
SECURITY COVER
|
15.1 |
Minimum required security cover
|
15.2 |
Prepayment; provision of additional security
|
15.3 |
Valuation of Ships
|
(i) |
as at a date not more than 30 days previously;
|
(ii) |
with or without physical inspection of that Ship (as the Agent may require); and
|
(b) |
If a Borrower disagrees with the valuation obtained by the Agent in accordance with paragraph (a) above, it shall be entitled to obtain a second valuation from an Approved Broker
selected by the Borrowers and appointed by the Agent, and prepared in accordance with sub-paragraphs (i) to (iii) of paragraph (a) above. In that case the Market Value of the Mortgaged Ship shall be the arithmetic mean of the two valuations
issued provided that if the Borrowers do not elect to appoint an Approved Broker within 14 days after the Agent’s request to receive a valuation of a Mortgaged Ship, the Market Value of that
Mortgaged Ship shall be that shown in the sole valuation obtained by the Agent in accordance with paragraph (a) above.
|
15.4 |
Value of additional vessel security
|
15.5 |
Valuations binding
|
15.6 |
Provision of information
|
15.7 |
Payment of valuation expenses
|
15.8 |
Frequency of valuations
|
16 |
PAYMENTS AND CALCULATIONS
|
16.1 |
Currency and method of payments
|
(a) |
by not later than 11.00 a.m. (New York City time) on the due date;
|
(d) |
in the case of an amount payable to the Security Trustee, to such account as it may from time to time notify to the Borrowers and the other Creditor Parties.
|
16.2 |
Payment on non-Business Day
|
(a) |
the due date shall be extended to the next succeeding Business Day; or
|
(b) |
if the next succeeding Business Day falls in the next calendar month, the due date shall be brought forward to the immediately preceding Business Day,
|
16.3 |
Basis for calculation of periodic payments
|
16.4 |
Distribution of payments to Creditor Parties
|
16.5 |
Permitted deductions by Agent
|
16.6 |
Agent only obliged to pay when monies received
|
16.7 |
Refund to Agent of monies not received
|
(a) |
refund the sum in full to the Agent; and
|
16.8 |
Agent may assume receipt
|
16.9 |
Creditor Party accounts
|
16.10 |
Agent’s memorandum account
|
16.11 |
Accounts prima facie evidence
|
17 |
APPLICATION OF RECEIPTS
|
17.1 |
Normal order of application
|
(a) |
FIRST: in or towards satisfaction of any amounts then due and payable under the Finance Documents in the following order and proportions:
|
(ii) |
secondly, in or towards satisfaction pro rata of any and all amounts of interest or default interest payable to the Creditor Parties under the Finance Documents; and
|
(iii) |
thirdly, in or towards satisfaction of the Loan;
|
(c) |
THIRDLY: any surplus shall be paid to the Borrowers or to any other person appearing to be entitled to it.
|
17.2 |
Application by any covered bond Lender
|
(a) |
firstly, in or towards satisfaction of the amounts set out under Clause 17.1(a)(i) (Normal order of application);
|
(b) |
(c) |
thirdly, in or towards satisfaction of any part of the Loan that corresponds to any unregistered part of that Lender’s contribution.
|
17.3 |
Variation of order of application
|
17.4 |
Notice of variation of order of application
|
17.5 |
Appropriation rights overridden
|
18 |
APPLICATION OF EARNINGS
|
18.1 |
Payment of Earnings
|
(a) |
it shall maintain the Accounts with the Account Bank;
|
(b) |
it shall ensure that all Earnings of the Ship owned by it are paid to the Earnings Account for that Ship;
|
(c) |
(d) |
the Dry Docking Reserve Amount required pursuant to Clause 11.20 (Dry Docking Reserve Amount) shall be maintained in the Dry Dock Reserve
Account.
|
18.2 |
Monthly retentions to Retention Account
|
(a) |
(b) |
the relevant fraction of the aggregate amount of interest on that Advance which is payable on the next due date for payment of interest under this Agreement,
|
18.3 |
Shortfall in Earnings
|
18.4 |
Application of retentions
|
(a) |
(b) |
18.5 |
Interest accrued on the Accounts
|
18.6 |
Release of accrued interest
|
18.7 |
Location of Accounts
|
(a) |
comply with any requirement of the Agent as to the location or re-location of the Accounts (or any of them); and
|
18.8 |
Debits for fees, expenses etc.
|
18.9 |
Borrowers’ obligations unaffected
|
(a) |
the liability of the Borrowers to make payments of principal and interest on the due dates; or
|
(b) |
any other liability or obligation of the Borrowers or any Security Party under any Finance Document.
|
18.10 |
Restriction on withdrawal
|
(a) |
During the Security Period no sum may be withdrawn by a Borrower from the Liquidity Account, the Dry Dock Reserve Account or the Retention Account (other than interest
pursuant to Clause 18.6 (Release of accrued interest) and/or any sums withdrawn in accordance with, and pursuant to, the terms of Clauses 11.19(c) (Minimum Liquidity
and Additional Minimum Liquidity) and/or 11.20(d) (Dry Docking Reserve Amount)), provided that no Event of Default or Potential Event of Default has occurred which is continuing, without the
prior written consent of the Agent.
|
19 |
EVENTS OF DEFAULT
|
19.1 |
Events of Default
|
(a) |
any Borrower or any Security Party fails to pay when due or (if so payable) on demand any sum payable under a Finance Document or under any document relating to a Finance Document
unless:
|
(i) |
its failure to pay is caused by administrative or technical error or a Disruption Event; and
|
(ii) |
payment is made within three Business Days; or
|
(i) |
any Financial Indebtedness of a Relevant Person is not paid when due; or
|
(v) |
any Security Interest securing any Financial Indebtedness of a Relevant Person becomes enforceable; or
|
(g) |
any of the following occurs in relation to a Relevant Person:
|
(i) |
a Relevant Person becomes, in the opinion of the Majority Lenders, unable to pay its debts as they fall due; or
|
(ii) |
any assets of a Relevant Person are subject to any form of execution, attachment, arrest, sequestration or distress or any form of freezing order; or
|
(iii) |
any administrative or other receiver is appointed over any asset of a Relevant Person; or
|
(iv) |
an administrator is appointed (whether by the court or otherwise) in respect of a Relevant Person; or
|
(vi) |
a provisional liquidator is appointed in respect of a Relevant Person, a winding up order is made in relation to a Relevant Person or a winding up resolution is passed by a Relevant
Person; or
|
(h) |
any Borrower ceases or suspends carrying on its business or a part of its business which, in the opinion of the Majority Lenders, is material in the context of this Agreement; or
|
(i) |
it becomes unlawful in any Pertinent Jurisdiction or impossible:
|
(ii) |
for the Agent, the Security Trustee or the Lenders to exercise or enforce any right under, or to enforce any Security Interest created by, a Finance Document; or
|
(k) |
it appears to the Majority Lenders that, without their prior consent, a Change of Control has occurred or probably has occurred after the date of this Agreement in respect of a
Security Party; or
|
(m) |
a Relevant Person rescinds or purports to rescind or repudiates or purports to repudiate a Finance Document or evidences an intention to rescind or repudiate a Finance Document;
|
(n) |
the security constituted by a Finance Document is in any way imperilled or in jeopardy; or
|
(o) |
any other event occurs or any other circumstances arise or develop including, without limitation:
|
(i) |
a change in the financial position, state of affairs or prospects of any Borrower, the Corporate Guarantor or any other Security Party; or
|
(ii) |
any accident or other event involving any Ship or another vessel owned, chartered or operated by a Relevant Person (other than Castor Ships); or
|
(iii) |
the threat or commencement of legal or administrative action involving a Borrower, a Ship, any of the Approved Managers or any Security Party; or
|
19.2 |
Actions following an Event of Default
|
(a) |
the Agent may, and if so instructed by the Majority Lenders, the Agent shall:
|
(i) |
serve on the Borrowers a notice stating that all or part of the Commitments and of the other obligations of each Lender to the Borrowers under this Agreement are cancelled; and/or
|
19.3 |
Termination of Commitments
|
19.4 |
Acceleration of Loan
|
19.5 |
Multiple notices; action without notice
|
19.6 |
Notification of Creditor Parties and Security Parties
|
19.7 |
Creditor Party rights unimpaired
|
19.8 |
Exclusion of Creditor Party liability
|
19.9 |
Relevant Persons
|
19.10 |
Interpretation
|
20 |
FEES AND EXPENSES
|
20.1 |
Structuring and commitment fees:
|
20.2 |
Costs of negotiation, preparation etc.
|
20.3 |
Costs of variations, amendments, enforcement etc.
|
(a) |
(i) |
(ii) |
(c) |
20.4 |
Documentary taxes
|
20.5 |
Certification of amounts
|
21 |
INDEMNITIES
|
21.1 |
Indemnities regarding borrowing and repayment of Loan
|
(b) |
the receipt or recovery of all or any part of the Loan or an overdue sum otherwise than on the last day of an Interest Period or other relevant period;
|
(d) |
21.2 |
Break Costs
|
(a) |
(b) |
the Borrowers shall, within five Business Days of the Agent’s demand, pay to the Agent for the account of the Notifying Lender the amount of such Break Costs; and
|
21.3 |
Other breakage costs
|
21.4 |
Miscellaneous indemnities
|
(b) |
investigating any event which the Creditor Party concerned reasonably believes constitutes an Event of Default or Potential Event of Default;
|
(c) |
acting or relying on any notice, request or instruction which the Creditor Party concerned reasonably believes to be genuine, correct and appropriately authorised; or
|
(d) |
any other Pertinent Matter,
|
21.5 |
Environmental Indemnity
|
21.6 |
Currency indemnity
|
(a) |
making, filing or lodging any claim or proof against a Borrower or any Security Party, whether in its liquidation, any arrangement involving it or otherwise; or
|
(b) |
obtaining an order, judgment or award from any court or other tribunal in relation to any litigation or arbitration proceedings; or
|
(c) |
enforcing any such order, judgment or award,
|
21.7 |
Certification of amounts
|
21.8 |
Sums deemed due to a Lender
|
22 |
NO SET-OFF OR TAX DEDUCTION
|
22.1 |
No deductions
|
(a) |
without any form of set-off, counter-claim, cross-claim or condition; and
|
(b) |
free and clear of any tax deduction except a tax deduction which a Borrower is required by law to make.
|
22.2 |
Grossing-up for taxes
|
(a) |
that Borrower shall notify the Agent as soon as it becomes aware of the requirement;
|
22.3 |
Indemnity and evidence of payment of taxes
|
22.4 |
Exclusion of tax on overall net income
|
(a) |
tax on a Creditor Party’s overall net income; and
|
(b) |
a FATCA Deduction.
|
22.5 |
FATCA Information
|
(a) |
Subject to paragraph (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
|
(B) |
not a FATCA Exempt Party; and
|
(i) |
any law or regulation;
|
(ii) |
any fiduciary duty; or
|
(iii) |
any duty of confidentiality.
|
(i) |
where the Lender knows or has reason to know that a Borrower is a US Tax Obligor and the relevant Lender is a Party as at the date of this Agreement, the date of this Agreement;
|
(iii) |
the date of a request from the Agent,
|
(iv) |
a withholding certificate on US Internal Revenue Service Form W-8 or Form W-9 (or any successor form) (as applicable); or
|
(v) |
any withholding statement and other documentation, authorisations and waivers as the Agent may require to certify or establish the status of such Lender under FATCA.
|
22.6 |
FATCA Deduction
|
23 |
ILLEGALITY, ETC.
|
23.1 |
Illegality
|
(a) |
unlawful or prohibited as a result of the introduction of a new law, an amendment to an existing law or a change in the manner in which an existing law is or will be interpreted or
applied; or
|
(b) |
contrary to, or inconsistent with, any regulation,
|
23.2 |
Notification of illegality
|
23.3 |
Prepayment; termination of Commitment
|
24 |
INCREASED COSTS
|
24.1 |
Increased costs
|
24.2 |
Meaning of “increased cost”
|
(b) |
a reduction in the amount of any payment to the Notifying Lender under this Agreement or in the effective return which such a payment represents to the Notifying Lender or on its
capital;
|
(d) |
a liability to make a payment, or a return foregone, which is calculated by reference to any amounts received or receivable by the Notifying Lender under this Agreement,
|
24.3 |
Notification to Borrowers of claim for increased costs
|
24.4 |
Payment of increased costs
|
24.5 |
Notice of prepayment
|
24.6 |
Prepayment; termination of Commitment
|
(a) |
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall be cancelled; and
|
24.7 |
Application of prepayment
|
25 |
SET-OFF
|
25.1 |
Application of credit balances
|
(b) |
for that purpose:
|
(i) |
break, or alter the maturity of, all or any part of a deposit of that Borrower;
|
(ii) |
convert or translate all or any part of a deposit or other credit balance into Dollars; and
|
(iii) |
enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.
|
25.2 |
Existing rights unaffected
|
25.3 |
Sums deemed due to a Lender
|
25.4 |
No Security Interest
|
26 |
TRANSFERS AND CHANGES IN LENDING OFFICES
|
26.1 |
Transfer by Borrowers
|
26.2 |
Transfer by a Lender
|
(a) |
Subject to this Clause 26 (Transfers and Changes in Lending Offices), a Lender (the “Transferor
Lender”) may at any time, with the Borrowers’ prior consent or approval, cause:
|
(i) |
its rights in respect of all or part of its Contribution; or
|
(ii) |
its obligations in respect of all or part of its Commitment; or
|
(iii) |
a combination of (a) and (b); or
|
(iv) |
all or part of its credit risk under this Agreement and the other Finance Documents,
|
(c) |
The consent of a Borrowers to an assignment or transfer must not be withheld solely because the assignment or transfer may result in an increase to any Mandatory Cost.
|
26.3 |
Transfer Certificate, delivery and notification
|
(a) |
sign the Transfer Certificate on behalf of itself, the Borrowers, the Security Parties, the Security Trustee and each of the other Lenders;
|
(b) |
on behalf of the Transferee Lender, send to each Borrower and each Security Party letters or faxes notifying them of the Transfer Certificate and attaching a copy of it; and
|
(c) |
send to the Transferee Lender copies of the letters or faxes sent under paragraph (b) above.
|
26.4 |
Effective Date of Transfer Certificate
|
26.5 |
No transfer without Transfer Certificate
|
26.6 |
Lender re-organisation
|
26.7 |
Effect of Transfer Certificate
|
(b) |
the Transferor Lender’s Commitment is discharged to the extent specified in the Transfer Certificate;
|
(c) |
the Transferee Lender becomes a Lender with the Contribution previously held by the Transferor Lender and a Commitment of an amount specified in the Transfer Certificate;
|
26.8 |
Maintenance of register of Lenders
|
26.9 |
Reliance on register of Lenders
|
26.10 |
Authorisation of Agent to sign Transfer Certificates
|
26.11 |
Registration fee
|
26.12 |
Sub-participation; subrogation assignment
|
26.13 |
Sub-division, split, modification or re-tranching
|
26.14 |
Disclosure of information
|
(i) |
(c) |
26.15 |
Change of lending office
|
(a) |
the date on which the Agent receives the notice; and
|
(b) |
the date, if any, specified in the notice as the date on which the change will come into effect.
|
26.16 |
Notification
|
26.17 |
Security over Lenders’ rights
|
(a) |
any charge, assignment or other Security Interest to secure obligations to a federal reserve or central bank; and
|
26.18 |
Replacement of a Reference Bank
|
26.19 |
Securitisation
|
26.20 |
No additional costs
|
27 |
VARIATIONS AND WAIVERS
|
27.1 |
Required consents
|
(a) |
(b) |
Any instructions given by the Majority Lenders will be binding on all the Creditor Parties.
|
(c) |
(i) |
(ii) |
on behalf of any Creditor Party, any amendment or waiver permitted by any other provision of this Clause 27 (Variations and Waivers).
|
27.2 |
Exceptions
|
(a) |
Subject to Clause 27.4 (Replacement of Screen Rate), an amendment or waiver that has the effect of changing or which relates to:
|
(i) |
(ii) |
an extension to the date of payment of any amount under the Finance Documents;
|
(iii) |
a reduction in the Margin or a reduction in the amount of any payment of principal, interest fees, commission or other amount payable under any of the Finance Documents;
|
(iv) |
an increase in or an extension of any Lender’s Commitment;
|
(v) |
any provision which expressly requires the consent of all the Lenders;
|
(vii) |
any release of any Security Interest, guarantee, indemnities or subordination arrangement created by any Finance Document;
|
(viii) |
any change of the currency in which the Loan is provided or any amount is payable under any of the Finance Documents;
|
(ix) |
any change to the Screen Rate pursuant to Clause 27.4 (Replacement of Screen Rate);
|
(x) |
an extension of the Availability Period; or
|
(xi) |
(b) |
27.3 |
Exclusion of other or implied variations
|
(a) |
a provision of this Agreement or another Finance Document; or
|
(b) |
an Event of Default; or
|
(c) |
a breach by a Borrower or a Security Party of an obligation under a Finance Document or the general law; or
|
(d) |
any right or remedy conferred by any Finance Document or by the general law,
|
27.4 |
Replacement of Screen Rate
|
(a) |
If a Screen Rate Replacement Event has occurred in relation to the Screen Rate the Agent (acting on the instructions of all Lenders) shall be entitled to:
|
(i) |
replace the Screen Rate with a Replacement Benchmark;
|
(iii) |
amend this Agreement for the purpose of any of:
|
(A) |
providing for the use of a Replacement Benchmark;
|
(B) |
aligning any provision to the use of that Replacement Benchmark;
|
(D) |
implementing market conventions applicable to that Replacement Benchmark;
|
(E) |
providing for appropriate fallback (and market disruption) provisions for that Replacement Benchmark; and
|
(F) |
adjusting the pricing in accordance with paragraph (ii) above.
|
27.5 |
Deemed consent
|
(a) |
the replacement of the Screen Rate with a Replacement Benchmark in accordance with sub-paragraph (a)(i) of Clause 27.4 (Replacement
of Screen Rate) (and the designation of such benchmark as permitted under sub-paragraphs (b) and (c) of the definition of “Replacement Benchmark”);
|
(b) |
the adjustment of pricing in accordance with sub-paragraph (a)(ii) of Clause 27.4 (Replacement of Screen Rate);
|
(c) |
any amendment of any Finance Document as contemplated in sub-paragraph (a)(iii) of Clause 27.4 (Replacement of Screen Rate);
and
|
(d) |
any other amendment, variation, waiver, suspension or limit requested by a Borrower or any Security Party which requires the approval of all Lenders or the Majority
Lenders (as the case may be),
|
28 |
NOTICES
|
28.1 |
General
|
28.2 |
Addresses for communications
|
for credit administrative matters: |
Hamburg Commercial Bank AG
|
|
Gerhart-Hauptmann-Platz 50
|
||
20095 Hamburg
|
||
Germany | ||
Fax No: +49 40 3333 34167
|
28.3 |
Effective date of notices
|
(a) |
a notice which is delivered personally or posted shall be deemed to be served, and shall take effect, at the time when it is delivered; and
|
(b) |
a notice which is sent by fax shall be deemed to be served, and shall take effect, two hours after its transmission is completed.
|
28.4 |
Service outside business hours
|
(a) |
on a day which is not a business day in the place of receipt; or
|
(b) |
on such a business day, but after 5 p.m. local time,
|
28.5 |
Illegible notices
|
28.6 |
Valid notices
|
(b) |
in the case of incorrect and/or incomplete contents, it should have been reasonably clear to the party on which the notice was served what the correct or missing particulars should
have been.
|
28.7 |
Electronic communication
|
(a) |
Any communication from the Agent or the other Creditor Parties made by electronic means will be sent unsecured and without electronic signature, however, the Borrowers may request the
Agent and the other Creditor Parties at any time in writing to change the method of electronic communication from unsecured to secured electronic mail communication.
|
(b) |
The Borrowers hereby acknowledge and accept the risks associated with the use of unsecured electronic mail communication including, without limitation, risk of delay, loss of data,
confidentiality breach, forgery, falsification and malicious software. The Agent and the other Creditor Parties shall not be liable in any way for any loss or damage or any other disadvantage suffered by the Borrowers resulting from such
unsecured electronic mail communication.
|
(c) |
If the Borrowers (or any of them) or any other Security Party wish to cease all electronic communication, they shall give written notice to the Agent and the other Creditor Parties
accordingly after receipt of which notice the Parties shall cease all electronic communication.
|
(d) |
For as long as electronic communication is an accepted form of communication, the Parties shall:
|
(i) |
notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and
|
(ii) |
notify each other of any change to their respective addresses or any other such information supplied to them; and
|
(e) |
Each Borrower undertakes and declares that any documents to fulfil the disclosure of the financial circumstances according to Sec. 18 of the German Banking Act (KWG) that were or are
hereinafter submitted to the Hamburg Commercial Bank AG electronically or on data carriers through the Borrowers or any other Security Party or any of them or a third party are complete and correct. It further agrees and declares that:
|
(i) |
it is irrelevant whether such documents were submitted with or without signature;
|
(ii) |
documents submitted to Hamburg Commercial Bank AG electronically or on data carriers according to Sec. 18 of the German Banking Act (KWG) have the same legal significance as documents
with signature in paper form; and
|
(iii) |
until written revocation, the declaration under this Clause 28.7 (Electronic communication) shall remain valid.
|
28.8 |
English language
|
28.9 |
Meaning of “notice”
|
29 |
JOINT AND SEVERAL LIABILITY
|
29.1 |
General
|
29.2 |
No impairment of Borrower’s obligations
|
(a) |
this Agreement being or later becoming void, unenforceable or illegal as regards the other Borrower;
|
(b) |
any Lender or the Security Trustee entering into any rescheduling, refinancing or other arrangement of any kind with the other Borrower;
|
(c) |
any Lender or the Security Trustee releasing the other Borrower or any Security Interest created by a Finance Document; or
|
(d) |
any combination of the foregoing.
|
29.3 |
Principal debtors
|
29.4 |
Subordination
|
(b) |
take or enforce any form of security from the other Borrower for such an amount, or in any other way seek to have recourse in respect of such an amount against any asset of the other
Borrower; or
|
(c) |
set off such an amount against any sum due from it to the other Borrower; or
|
(d) |
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving the other Borrower or other Security Party; or
|
(e) |
exercise or assert any combination of the foregoing.
|
29.5 |
Borrowers’ required action
|
30 |
SUPPLEMENTAL
|
30.1 |
Rights cumulative, non-exclusive
|
(a) |
cumulative;
|
(b) |
may be exercised as often as appears expedient; and
|
(c) |
shall not, unless a Finance Document explicitly and specifically states so, be taken to exclude or limit any right or remedy conferred by any law.
|
30.2 |
Severability of provisions
|
30.3 |
Counterparts
|
30.4 |
Third party rights
|
30.5 |
Benefit and binding effect
|
31 |
BAIL-IN
|
(a) |
any Bail-In Action in relation to any such liability, including (without limitation):
|
(i) |
a reduction, in full or in part, in the principal amount, or outstanding amount due (including any accrued but unpaid interest) in respect of any such liability;
|
(ii) |
a conversion of all, or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, it; and
|
(iii) |
a cancellation of any such liability; and
|
(b) |
a variation of any term of any Finance Document to the extent necessary to give effect to any Bail-In Action in relation to any such liability.
|
32 |
LAW AND JURISDICTION
|
32.1 |
English law
|
32.2 |
Exclusive English jurisdiction
|
32.3 |
Choice of forum for the exclusive benefit of the Creditor Parties
|
(a) |
to commence proceedings in relation to any Dispute in the courts of any country other than England and which have or claim jurisdiction to that Dispute; and
|
(b) |
to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.
|
32.4 |
Process agent
|
32.5 |
Creditor Party rights unaffected
|
32.6 |
Meaning of “proceedings” and “Dispute”
|
To:
|
|
|
Gerhart-Hauptmann-Platz 50
|
|
20095 Hamburg
|
|
Germany
|
|
Attention: Loans Administration
|
2 |
We request to borrow as follows:
|
(a) |
(b) |
Drawdown Date: [●];
|
(c) |
Duration of the first Interest Period shall be [●] months; and
|
(d) |
Payment instructions: account in our name and numbered [●] with [●] of [●].
|
3 |
We represent and warrant that:
|
(a) |
(b) |
no Event of Default or Potential Event of Default has occurred or will result from the borrowing of that Advance.
|
4 |
This Drawdown Notice cannot be revoked without the prior consent of the Majority Lenders.
|
5 |
1 |
A duly executed original of:
|
(a) |
this Agreement;
|
(b) |
the Corporate Guarantee;
|
(c) |
the Agency and Trust Agreement;
|
(d) |
any Subordination Agreement;
|
(e) |
any Subordinated Debt Security;
|
(f) |
the Side Letter; and
|
(g) |
the Account Pledges.
|
4 |
The original of any power of attorney under which any Finance Document is executed on behalf of a Borrower, the Corporate Guarantor or any other Security Party.
|
5 |
Copies of all consents which either Borrower, the Corporate Guarantor or any other Security Party requires to enter into, or make any payment under, any Finance Document.
|
6 |
The originals of any mandates or other documents required in connection with the opening or operation of the Accounts.
|
7 |
11 |
Documents establishing that each Ship is managed by the relevant Approved Manager on terms acceptable to the Lenders.
|
12 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the
Agent at the Borrowers’ expense.
|
(a) |
“Relevant Borrower” means the Borrower which is or is to become the owner of the Relevant Ship; and
|
(b) |
“Relevant Ship” means the Ship which is relevant to the Advance being borrowed on the relevant Drawdown Date.
|
2 |
Documentary evidence that:
|
(a) |
the Relevant Ship is definitively and permanently registered in the name of the Relevant Borrower under an Approved Flag in accordance with the laws of the applicable Approved Flag
State;
|
(b) |
the Relevant Ship is in the absolute and unencumbered ownership of the Relevant Borrower save as contemplated by the Finance Documents;
|
(e) |
the Relevant Ship is insured in accordance with the provisions of this Agreement and all requirements therein in respect of insurances have been complied with; and
|
3 |
In relation to an Approved Manager and the Relevant Ship:
|
(a) |
the Approved Manager’s Undertaking relative thereto; and
|
(i) |
if the Borrowers request such valuation but fail to select the second Approved Broker within the Drawdown Request Period, then the Initial Market Value
of the Relevant Ship shall be that shown in the sole valuation obtained by the Agent; or
|
(ii) |
if the Borrowers do select a second Approved Broker within the Drawdown Request Period, the Initial Market Value of the Relevant Ship in such circumstances shall be the arithmetic
mean of both valuations Provided even further that if the difference between such two valuations is greater than 15 per cent., a third valuation shall
be commissioned from a third Approved Broker appointed and selected by the Agent (prepared in accordance with Clause 15.3 (Valuation of Ships))
and the Initial Market Value of the Relevant Ship in such circumstances shall be the arithmetic mean of all three valuations.
|
5 |
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of the relevant Approved Flag State and such other relevant jurisdictions as the
Agent may require.
|
6 |
A favourable opinion from an independent insurance consultant acceptable to the Agent on such matters relating to the insurances for the Relevant Ship as the Agent may require.
|
8 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the
Agent at the Borrowers’ expense.
|
9 |
10 |
A recent survey report (or comparable inspection report satisfactory to the Agent ) in respect of each Relevant Ship.
|
11 |
Copies of any memorandum of agreement in respect of a Relevant Ship (and any addenda thereto) or, as the case may be, shipbuilding contracts of a Relevant Ship.
|
4 |
The Additional Cost Rate for any Lender lending from a lending office in the United Kingdom will be calculated by the Agent as follows:
|
E |
is designed to compensate Lenders for amounts payable under the Fees Rules and is calculated by the Agent as being the average of the most recent rates of charge supplied by the
Reference Banks to the Agent pursuant to paragraph 6 below and expressed in pounds per £1,000,000.
|
5 |
For the purposes of this Schedule:
|
(c) |
“Fees Rules” means the rules on periodic fees contained in the FSA Supervision Manual or such other law or regulation as may be in force from
time to time in respect of the payment of fees for the acceptance of deposits;
|
(e) |
“Tariff Base” has the meaning given to it in, and will be calculated in accordance with, the Fees Rules.
|
(a) |
the jurisdiction of its lending office; and
|
(b) |
any other information that the Agent may reasonably require for such purpose.
|
10 |
To: |
2 |
In this Certificate, terms defined in the Loan Agreement shall, unless the contrary intention appears, have the same meanings and:
|
3 |
The effective date of this Certificate is [●] Provided that this Certificate shall not come
into effect unless it is signed by the Agent on or before that date.
|
8 |
The Transferor:
|
(a) |
warrants to the Transferee and each Relevant Party that:
|
(i) |
the Transferor has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which are in connection with this transaction; and
|
(ii) |
this Certificate is valid and binding as regards the Transferor;
|
(b) |
warrants to the Transferee that the Transferor is absolutely entitled, free of encumbrances, to all the rights and interests covered by the assignment in paragraph 4 above; and
|
9 |
The Transferee:
|
(a) |
confirms that it has received a copy of the Loan Agreement and each of the other Finance Documents;
|
(b) |
agrees that it will have no rights of recourse on any ground against either the Transferor, the Agent, the Mandated Lead Arranger, the Security Trustee, any Lender in the event that:
|
(i) |
any of the Finance Documents prove to be invalid or ineffective;
|
(ii) |
either Borrower or any Security Party fails to observe or perform its obligations, or to discharge its liabilities, under any of the Finance Documents;
|
(d) |
warrants to the Transferor and each Relevant Party that:
|
(i) |
it has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which it needs to take or obtain in connection with this transaction;
and
|
(ii) |
this Certificate is valid and binding as regards the Transferee; and
|
(e) |
confirms the accuracy of the administrative details set out below regarding the Transferee.
|
[Name of Transferor]
|
[Name of Transferee]
|
By:
|
By:
|
Date:
|
Date:
|
EXECUTED as a DEED by
|
)
|
[Liono] [Snoopy] [Cinderella] [Luffy] Shipping Co.
|
)
|
acting by President or Secretary
|
)
|
)
|
To:
|
Hamburg Commercial Bank AG
|
Gerhart-Hauptmann-Platz 50
|
|
D-20095 Hamburg
|
|
Germany
|
(a) |
the aggregate of the Minimum Liquidity standing to the credit of the Liquidity Account is $[●];
|
(b) |
the Security Cover Ratio is above 130 per cent.; and
|
|
|
Name: [●]
|
|
Title: [senior officer]
|
AGENT
|
|
SIGNED by
|
)
|
)
|
|
for and on behalf of
|
)
|
)
|
|
in the presence of:
|
)
|
MANDATED LEAD ARRANGER
|
|
SIGNED by
|
)
|
)
|
|
for and on behalf of
|
)
|
)
|
|
in the presence of:
|
)
|
SECURITY TRUSTEE
|
|
SIGNED by
|
)
|
)
|
|
for and on behalf of
|
)
|
)
|
|
in the presence of:
|
)
|
Clause | Page | |
Section 1 Interpretation
|
2
|
|
1
|
Definitions and Interpretation
|
2
|
Section 2 The Facility
|
21
|
|
2
|
The Facility
|
21
|
3
|
Purpose
|
21
|
4
|
Conditions of Utilisation
|
22
|
Section 3 Utilisation
|
23
|
|
5
|
Utilisation
|
23
|
Section 4 Repayment, Prepayment and Cancellation
|
24
|
|
6
|
Repayment
|
24
|
7
|
Prepayment and Cancellation
|
25
|
Section 5 Costs of Utilisation
|
27
|
|
8
|
Interest
|
27
|
9
|
Interest Periods
|
28
|
10
|
Changes to the Calculation of Interest
|
28
|
11
|
Fees
|
29
|
Section 6 Additional Payment Obligations
|
30
|
|
12
|
Tax Gross Up and Indemnities
|
30
|
13
|
Increased Costs
|
33
|
14
|
Other Indemnities
|
35
|
15
|
Mitigation by the Lender
|
37
|
16
|
Costs and Expenses
|
37
|
Section 7 Guarantees and Joint and Several Liability of Borrowers
|
39
|
|
17
|
Guarantee and Indemnity
|
39
|
18
|
Joint and Several Liability of the Borrowers
|
41
|
Section 8 Representations, Undertakings and Events of Default
|
44
|
|
19
|
Representations
|
44
|
20
|
Information Undertakings
|
50
|
21
|
Financial Covenants
|
52
|
22
|
General Undertakings
|
53
|
23
|
Insurance Undertakings
|
59
|
24
|
General Ship Undertakings
|
64
|
25
|
Accounts and application of Earnings
|
70
|
26
|
Valuation
|
71
|
27
|
Events of Default
|
71
|
Section 9 The Lender and the Obligors
|
75
|
|
28
|
Changes to the Lender
|
75
|
29
|
Changes to the Transaction Obligors
|
76
|
Section 10 Administration
|
77
|
|
30
|
Payment Mechanics
|
77
|
31
|
Set-Off
|
78
|
32
|
Conduct of Business by the Lender
|
79
|
33
|
Notices
|
79
|
34
|
Calculations and Certificates
|
81
|
35
|
Partial Invalidity
|
81
|
36
|
Remedies and Waivers
|
81
|
37
|
Entire Agreement
|
81
|
38
|
Settlement or Discharge Conditional
|
82
|
39
|
Irrevocable Payment
|
82
|
40
|
Confidential Information
|
82
|
41
|
Confidentiality of Funding Rates
|
85
|
42
|
Amendments
|
86
|
43
|
Counterparts
|
86
|
Section 11 Governing Law and Enforcement
|
87
|
|
44
|
Governing Law
|
87
|
45
|
Enforcement
|
87
|
Schedules
|
||
Schedule 1 The Parties
|
88
|
|
|
Part A The Obligors
|
88
|
|
Part B The Original Lender
|
89
|
Schedule 2 Conditions Precedent
|
90
|
|
|
Part A Conditions Precedent to Initial Utilisation Request
|
90
|
|
Part B Conditions Precedent to Utilisation
|
92
|
Schedule 3 Requests
|
94
|
|
|
Part A Utilisation Request
|
94
|
|
Part B Selection Notice
|
96
|
Schedule 4 Details of the Ships
|
97
|
|
Schedule 5 Timetables
|
98
|
|
Execution
|
||
Execution Pages
|
99
|
(1) |
BAGHEERA SHIPPING CO., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands MH96960 as borrower (“Borrower A”)
|
(2) |
GARFIELD SHIPPING CO., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands MH96960 as borrower (“Borrower B”)
|
(3) |
CASTOR MARITIME INC., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands MH96960 (the “Corporate Guarantor”)
|
(4) |
THE FINANCIAL INSTITUTION listed in Part B of Schedule 1 (The Parties) as Lender (the “Original
Lender”)
|
1 |
DEFINITIONS AND INTERPRETATION
|
1.1 |
Definitions
|
(a) |
the amount of the outstanding Loan; and
|
(b) |
in relation to any proposed Utilisation, the amount of the Loan that is due to be made on or before the proposed Utilisation Date.
|
(a) |
the interest which the Lender should have received for the period from the date of receipt of all or any part of the Loan or an Unpaid Sum to the last day of the current Interest Period in relation to the
Loan, the relevant part of the Loan or that Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period;
|
(b) |
the amount which the 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 Relevant 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.
|
(a) |
information that:
|
(i) |
is or becomes public information other than as a direct or indirect result of any breach by the Lender of Clause 40 (Confidential Information);
|
(ii) |
is identified in writing at the time of delivery as non-confidential by any member of the Group or any of its advisers; or
|
(iii) |
is known by the Lender before the date the information is disclosed to it by any member of the Group or any of its advisers or is lawfully obtained by the Lender after that date, from a source which is, as
far as the Lender is aware, unconnected with the Group and which, in either case, as far as the Lender is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality; and
|
(b) |
any Funding Rate.
|
(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, if applicable, any Transaction Obligor; 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 or, if applicable, any Transaction Obligor
preventing that, or any other, Party or, if applicable, any Transaction Obligor:
|
(i) |
from performing its payment obligations under the Finance Documents; or
|
(ii) |
from communicating with other Parties or, if applicable, any Transaction Obligor in accordance with the terms of the Finance Documents,
|
(a) |
the following, save to the extent that any of them is, with the prior written consent of the Lender, pooled or shared with any other person:
|
(i) |
all freight, hire and passage moneys including, without limitation, all moneys payable under, arising out of or in connection with a Charter or a Charter Guarantee;
|
(ii) |
the proceeds of the exercise of any lien on sub-freights;
|
(iii) |
compensation payable to a Borrower or the Lender in the event of requisition of that Ship for hire or use;
|
(iv) |
remuneration for salvage and towage services;
|
(v) |
demurrage and detention moneys;
|
(vi) |
without prejudice to the generality of sub-paragraph (i) above, damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of that Ship;
|
(vii) |
all moneys which are at any time payable under any Insurances in relation to loss of hire;
|
(viii) |
all monies which are at any time payable to a Borrower in relation to general average contribution; and
|
(b) |
if and whenever that Ship is employed on terms whereby any moneys falling within sub-paragraphs (i) to (viii) of paragraph (a) above are pooled or shared with any other person, that proportion of the net
receipts of the relevant pooling or sharing arrangement which is attributable to that Ship.
|
(a) |
an account in the name of Borrower A with the Account Bank designated “Bagheera Shipping Co. - Earnings Account”;
|
(b) |
an account in the name of Borrower B with the Account Bank designated “Garfield Shipping Co. - Earnings Account”;
|
(c) |
any other account in the name of a Borrower with the Account Bank which may, with the prior written consent of the Lender, be opened in the place of the account referred to in paragraph (a) or (b) above (as
the case may be), irrespective of the number or designation of such replacement account; or
|
(d) |
any sub-account of any account referred to in paragraphs (a) or (c) above.
|
(a) |
any release, emission, spill or discharge of Environmentally Sensitive Material whether within a Ship or from a Ship into any other vessel or into or upon the air, water, land or soils (including the seabed)
or surface water that has an assessed cost $500,000 or higher; or
|
(b) |
any incident in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, water, land or soils (including the seabed) or surface water from a vessel other than
any Ship and which involves a collision between any Ship and such other vessel or some other incident of navigation or operation, in either case, in connection with which a Ship is actually liable to be arrested, attached, detained or
injuncted and/or a Ship and/or any Transaction Obligor and/or any operator or manager of a Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action that has an assessed cost $500,000 or higher; or
|
(c) |
any other incident that has an assessed cost $500,000 or higher in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, water, land or soils (including
the seabed) or surface water otherwise than from a Ship and in connection with which a Ship is actually liable to be arrested and/or where any Transaction Obligor and/or any operator or manager of a Ship is at fault or allegedly at fault or
otherwise liable to any legal or administrative action other than in accordance with an Environmental Approval.
|
(a) |
sections 1471 to 1474 of the Code or any associated regulations;
|
(b) |
any treaty, law or 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.
|
(a) |
this Agreement;
|
(b) |
each Utilisation Request;
|
(c) |
any Security Document;
|
(d) |
any Manager’s Undertaking;
|
(e) |
any Subordination Agreement;
|
(f) |
any other document which is executed for the purpose of establishing any priority or subordination arrangement in relation to the Secured Liabilities; or
|
(g) |
any other document designated as such by the Lender and the Borrowers.
|
(a) |
moneys borrowed;
|
(b) |
any amount raised by acceptance under any acceptance credit 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 relation to any lease or hire purchase contract which would, in accordance with GAAP, be treated as a balance sheet liability (other than any liability in respect of a lease or
hire purchase contract which would, in accordance with GAAP in force prior to 1 January 2019, have been treated as an operating lease);
|
(e) |
receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);
|
(f) |
any amount raised under any other transaction (including any forward sale or purchase agreement) of a type not referred to in any other paragraph of this definition having the commercial effect of a
borrowing;
|
(g) |
any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked
to market value (or, if any actual amount is due as a result of the termination or close-out of that derivative transaction, that amount) shall be taken into account);
|
(h) |
any counter-indemnity obligation in relation to a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and
|
(i) |
the amount of any liability in relation to any guarantee or indemnity for any of the items referred to in paragraphs (a) to (h) above.
|
(a) |
the Earnings, the Insurances and any Requisition Compensation; and
|
(b) |
any Charter and any Charter Guarantee,
|
(a) |
in relation to Ship A, a time charterparty evidenced by a recapitulation email dated 16 June 2021 and entered into by and between Borrower A, as owner and D’Amico Dry DAC, as charterer; and
|
(b) |
in relation to Ship B, a time charterparty evidenced by a recapitulation email dated 25 October 2021 and entered into by and between Borrower B, as owner and Oldendorff Carriers GmbH & Co. KG,
as charterer.
|
(a) |
all policies and contracts of insurance, including entries of that Ship in any protection and indemnity or war risks association, effected in relation to that Ship, the Earnings or otherwise in relation to
that Ship whether before, on or after the date of this Agreement; and
|
(b) |
all rights and other assets relating to, or derived from, any of such policies, contracts or entries, including any rights to a return of premium and any rights in relation to any claim whether or not the
relevant policy, contract of insurance or entry has expired on or before the date of this Agreement.
|
(a) |
the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Interest Period of the Loan or that part of the Loan; and
|
(b) |
the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Interest Period of the Loan or that part of the Loan,
|
(a) |
the Original Lender; and
|
(b) |
any bank, financial institution, trust, fund or other entity which has become the Lender in accordance with Clause 28 (Changes to the Lender),
|
(a) |
the applicable Screen Rate as of the Specified Time for dollars and for a period of one Month; or
|
(b) |
as otherwise determined pursuant to Clause 10.1 (Unavailability of Screen Rate),
|
(a) |
as at a date not more than 14 days previously;
|
(b) |
by an Approved Valuer (selected by the Lender and acceptable to the Borrowers and if the Borrowers have requested two valuations to be obtained, the second Approved Valuer selected by the Borrowers and
acceptable to the Lender);
|
(c) |
with or without physical inspection of that Ship or vessel (as the Lender may require); and
|
(d) |
on the basis of a sale for prompt delivery for cash on normal arm’s length commercial terms as between a willing seller and a willing buyer, free of any Charter,
|
(a) |
the business, operations, property, condition (financial or otherwise) or prospects of the Corporate Guarantor or the Group as a whole; or
|
(b) |
the ability of any Transaction Obligor to perform its obligations under any Finance Document; or
|
(c) |
the validity or enforceability of, or the effectiveness or ranking of any Security granted or intended to be granted pursuant to any of, the Finance Documents or the rights or remedies of the Lender under any
of the Finance Documents.
|
(a) |
in respect of Tranche A, the amount of $406,000; and
|
(b) |
in respect of Tranche B, the amount of $520,000,
|
(a) |
(subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is
one, or if there is not, on the immediately preceding Business Day;
|
(b) |
if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and
|
(c) |
if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.
|
(a) |
which is a time, voyage or consecutive voyage charter;
|
(b) |
the duration of which does not exceed and is not capable of exceeding, by virtue of any optional extensions, 12 months plus a redelivery allowance of not more than 30 days;
|
(c) |
which is entered into on bona fide arm’s length terms at the time at which that Ship is fixed; and
|
(d) |
in relation to which not more than two months’ hire is payable in advance,
|
(a) |
any Financial Indebtedness incurred under the Finance Documents; and
|
(b) |
any Financial Indebtedness that is subordinated to all Financial Indebtedness incurred under the Finance Documents pursuant to a Subordination Agreement or otherwise and which is, in the case of any such
Financial Indebtedness of a Borrower, the subject of Subordinated Debt Security.
|
(a) |
Security created by the Finance Documents;
|
(b) |
liens for unpaid master’s and crew’s wages in accordance with first class ship ownership and management practice and not being enforced through arrest;
|
(c) |
liens for salvage;
|
(d) |
liens for master’s disbursements incurred in the ordinary course of trading in accordance with first class ship ownership and management practice and not being enforced through arrest; and
|
(e) |
any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of any Ship:
|
(i) |
not as a result of any default or omission by either Borrower;
|
(ii) |
not being enforced through arrest; and
|
(iii) |
subject, in the case of liens for repair or maintenance, to Clause 24.16 (Restrictions on chartering, appointment of managers etc.),
|
(a) |
its Original Jurisdiction;
|
(b) |
any jurisdiction where any asset subject to, or intended to be subject to, any of the Transaction Security created, or intended to be created, by it is situated;
|
(c) |
any jurisdiction where it conducts its business; and
|
(d) |
the jurisdiction whose laws govern the perfection of any of the Security Documents entered into by it.
|
(a) |
formally designated, nominated or recommended as the replacement for a Screen Rate by:
|
(i) |
the administrator of that Screen Rate (provided that the market or economic reality that such benchmark rate measures is the same as that measured by that Screen Rate); or
|
(ii) |
any Relevant Nominating Body,
|
(b) |
in the opinion of the Lender and the Borrowers, generally accepted in the international or any relevant domestic syndicated loan markets as the appropriate successor to a Screen Rate; or
|
(c) |
in the opinion of the Lender and the Borrowers, an appropriate successor to a Screen Rate.
|
(a) |
any expropriation, confiscation, requisition (excluding a requisition for hire or use which does not involve a requisition for title) or acquisition of that Ship, whether for full consideration, a
consideration less than its proper value, a nominal consideration or without any consideration, which is effected (whether de jure or de facto) by any
government or official authority or by any person or persons claiming to be or to represent a government or official authority; and
|
(b) |
any capture or seizure of that Ship (including any hijacking or theft) by any person whatsoever.
|
(a) |
imposed by law or regulation of the United Kingdom, the Council of the European Union, the United Nations or its Security Council or the United States of America regardless of whether the same is or is not
binding on any Transaction Obligor; or
|
(b) |
otherwise imposed by any law or regulation binding on a Transaction Obligor or to which a Transaction Obligor is subject (which shall include without limitation, any extra-territorial sanctions imposed by law
or regulation of the United States of America).
|
(a) |
any Shares Security;
|
(b) |
any Mortgage;
|
(c) |
any General and Charter Assignment;
|
(d) |
any Account Security;
|
(e) |
any Subordinated Debt Security;
|
(f) |
any other document (whether or not it creates Security) which is executed as security for the Secured Liabilities; or
|
(g) |
any other document designated as such by the Lender and the Borrowers.
|
(a) |
the Transaction Security expressed to be granted in favour of the Lender and all proceeds of that Transaction Security;
|
(b) |
all obligations expressed to be undertaken by a Transaction Obligor to pay amounts in relation to the Secured Liabilities to the Lender and secured by the Transaction Security together with all
representations and warranties expressed to be given by a Transaction Obligor or any other person in favour of the Lender; and
|
(c) |
the Lender’s interest in any turnover trust created under the Finance Documents.
|
(a) |
a Transaction Obligor; or
|
(b) |
any other person who becomes a Subordinated Creditor in accordance with this Agreement.
|
(a) |
a Subordinated Loan Agreement; or
|
(b) |
any other document relating to or evidencing Subordinated Liabilities.
|
(a) |
actual, constructive, compromised, agreed or arranged total loss of that Ship; or
|
(b) |
any Requisition of the Ship unless the Ship is returned to the full control of the relevant Borrower within 30 days of such Requisition.
|
(a) |
in the case of an actual loss of a Ship, the date on which it occurred or, if that is unknown, the date when a Ship was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of a Ship, the earlier of:
|
(i) |
the date on which a notice of abandonment is given (or deemed or agreed to be given) to the insurers; and
|
(ii) |
the date of any compromise, arrangement or agreement made by or on behalf of a Borrower with its Ship’s insurers in which the insurers agree to treat that Ship as a total loss; and
|
(c) |
in the case of any other type of Total Loss, the date (or the most likely date) on which it appears to the Lender that the event constituting the total loss occurred.
|
(a) |
a Finance Document;
|
(b) |
a Subordinated Finance Document;
|
(c) |
any Charter; or
|
(d) |
any other document designated as such by the Lender and a Borrower and/or a Transaction Obligor.
|
(a) |
a person which is resident for tax purposes in the US; or
|
(b) |
a person some or all of whose payments under the Finance Documents are from sources within the US for US federal income tax purposes.
|
(a) |
any value added tax imposed by the Value Added Tax Act 1994;
|
(b) |
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
|
(c) |
any other tax of a similar nature, whether imposed in the United Kingdom or a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) or (b)
above, or imposed elsewhere.
|
1.2 |
Construction
|
(a) |
Unless a contrary indication appears, a reference in this Agreement to:
|
(i) |
the “Account Bank”, “Lender”, any “Obligor”, any “Party”,
any “Transaction Obligor” or any other person shall be construed so as to include its successors in title and permitted assigns;
|
(ii) |
“assets” includes present and future properties, revenues and rights of every description;
|
(iii) |
a liability which is “contingent” means a liability which is not certain to arise and/or the amount of which remains unascertained;
|
(iv) |
“document” includes a deed and also a letter, fax, email or telex;
|
(v) |
“expense” means any kind of cost, charge or expense (including all legal costs, charges and expenses) and any applicable Tax including VAT;
|
(vi) |
a “Finance Document”, a “Security Document” or “Transaction Document” or any other
agreement or instrument is a reference to that Finance Document, Security Document or Transaction Document or other agreement or instrument as amended, replaced, novated, supplemented, extended or restated;
|
(vii) |
“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;
|
(viii) |
“law” includes any order or decree, any form of delegated legislation, any treaty or international convention and any regulation or resolution of the Council of the
European Union, the European Commission, the United Nations or its Security Council;
|
(ix) |
“proceedings” means, in relation to any enforcement provision of a Finance Document, proceedings of any kind, including an application for a provisional or protective
measure;
|
(x) |
a “person” includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium, partnership
or other entity (whether or not having separate legal personality);
|
(xi) |
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;
|
(xii) |
a provision of law is a reference to that provision as amended or re-enacted from time to time;
|
(xiii) |
a time of day is a reference to London time;
|
(xiv) |
any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official or any legal concept or thing shall, in respect of a jurisdiction other than
England, be deemed to include that which most nearly approximates in that jurisdiction to the English legal term;
|
(xv) |
words denoting the singular number shall include the plural and vice versa; and
|
(xvi) |
“including” and “in particular” (and other similar expressions) shall be construed as
not limiting any general words or expressions in connection with which they are used.
|
(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) |
Section, Clause and Schedule headings are for ease of reference only and are not to be used for the purposes of construction or interpretation of the Finance Documents.
|
(d) |
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.
|
(e) |
A Potential 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.
|
1.3 |
Construction of insurance terms
|
1.4 |
Agreed forms of Finance Documents
|
(a) |
in a form attached to a certificate dated the same date as this Agreement (and signed by each Borrower and the Lender); or
|
(b) |
in any other form agreed in writing between each Borrower and the Lender.
|
1.5 |
Third party rights
|
(a) |
Unless expressly provided to the contrary in a Finance Document, a person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 (the “Third
Parties Act”) to enforce or to enjoy the benefit of any term of this Agreement.
|
(b) |
Notwithstanding any term of any Finance Document, the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.
|
(c) |
Any Affiliate, Receiver or Delegate or any other person described in paragraph (f) of Clause 14.2 (Other indemnities) may, subject to this Clause 1.5 (Third party rights) and the Third Parties Act, rely on any Clause of this Agreement which expressly confers rights on it.
|
2 |
THE FACILITY
|
2.1 |
The Facility
|
2.2 |
Borrowers’ Agent
|
(a) |
Each Borrower by its execution of this Agreement irrevocably appoints the Corporate Guarantor to act on its behalf as its agent in relation to the Finance Documents and irrevocably authorises:
|
(i) |
the Corporate Guarantor on its behalf to supply all information concerning itself contemplated by this Agreement to the Lender and to give all notices and instructions (including the Utilisation Request), to
make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by either Borrower notwithstanding that they may affect the Borrower, without further reference to or the
consent of that Borrower; and
|
(ii) |
the Lender to give any notice, demand or other communication to that Borrower pursuant to the Finance Documents to the Corporate Guarantor,
|
(b) |
Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Corporate Guarantor or given to the Corporate Guarantor
under any Finance Document on behalf of a Borrower or in connection with any Finance Document (whether or not known to either Borrower) shall be binding for all purposes on that Borrower as if that Borrower had expressly made, given or
concurred with it. In the event of any conflict between any notices or other communications of the Corporate Guarantor and either Borrower, those of the Corporate Guarantor shall prevail.
|
3 |
PURPOSE
|
3.1 |
Purpose
|
3.2 |
Monitoring
|
4 |
CONDITIONS OF UTILISATION
|
4.1 |
Initial conditions precedent
|
4.2 |
Further conditions precedent
|
(a) |
on the date of a Utilisation Request and on the proposed Utilisation Date and before the Advance is made available:
|
(i) |
no Default is continuing or would result from the proposed Utilisation;
|
(ii) |
the Repeating Representations to be made by each Transaction Obligor are true;
|
(iii) |
no event described in paragraph (a) of Clause 7.2 (Change of control) has occurred;
|
(iv) |
in the case of an Advance under any Tranche, the Ship in respect of which such Advance is to be made has neither been sold nor become a Total Loss;
|
(v) |
no event has occurred which would give rise to the provisions of Clause 10.3 (Cost of funds); and
|
(vi) |
no event or circumstance has occurred which would have a material adverse effect in the financial condition of a Transaction Obligor; and
|
(b) |
on or before each Utilisation Date, the Lender has received or is satisfied it will receive when the Advance in respect of a Tranche is made available, all of the documents and other evidence listed in Part A
of Schedule 2 (Conditions Precedent) in form and substance satisfactory to the Lender.
|
4.3 |
Notification of satisfaction of conditions precedent
|
4.4 |
Waiver of conditions precedent
|
5 |
UTILISATION
|
5.1 |
Delivery of a Utilisation Request
|
(a) |
The Borrowers may utilise the Facility by delivery to the Lender of a duly completed Utilisation Request not later than the Specified Time.
|
(b) |
The Borrowers may not deliver more than one Utilisation Request under each Tranche.
|
5.2 |
Completion of the Utilisation Request
|
(a) |
the proposed Utilisation Date is a Business Day within the Availability Period;
|
(b) |
the currency and amount of a Utilisation comply with Clause 5.3 (Currency and amount);
|
(c) |
all applicable deductible items have been completed; and
|
(d) |
the proposed Interest Period complies with Clause 9 (Interest Periods).
|
5.3 |
Currency and amount
|
(a) |
The currency specified in a Utilisation Request must be dollars.
|
(b) |
The amount of the proposed Advance must be an amount which:
|
(i) |
in respect of the Advance under Tranche A is equal to $10,150,000; and
|
(ii) |
in respect of the Advance under Tranche B is equal to $13,000,000.
|
5.4 |
Advances
|
5.5 |
Cancellation of Commitment
|
5.6 |
Retentions and payment to third parties
|
(a) |
to deduct from the proceeds of the relevant Advance any items listed as deductible items in the relevant Utilisation Request (including, without limitation, the Minimum Liquidity Amount) and to apply them in
payment of the items to which they relate; and
|
(b) |
on each Utilisation Date, to pay to, or for the account of, the Borrowers, the balance (after any deduction made in accordance with paragraph (a) above) of the relevant Advance.
|
5.7 |
Disbursement of a Tranche to third party
|
6 |
REPAYMENT
|
6.1 |
Repayment of Loan
|
(a) |
Tranche A by:
|
(b) |
Tranche B by:
|
6.2 |
Appointment of nominee for repayment
|
(a) |
the Lender shall have consented to the same (such consent not to be unreasonably withheld); and
|
(b) |
the Lender shall have received from the Borrowers such documents as it may require for the purposes of carrying out its anti-money laundering and “know your customer” procedures, in a form and substance
satisfactory to the Lender for such purpose.
|
6.3 |
Reduction of Repayment Instalments
|
6.4 |
Termination Date
|
6.5 |
Reborrowing
|
7 |
PREPAYMENT AND CANCELLATION
|
7.1 |
Illegality
|
(a) |
the Lender shall promptly notify the Borrowers upon becoming aware of that event and the Available Facility will be immediately cancelled; and
|
(b) |
the Borrowers shall prepay the Loan on the last day of the Interest Period for the Loan occurring after the Lender has notified the Borrowers or, if earlier, the date specified by the Lender in the notice
delivered to the Borrowers (being no earlier than the last day of any applicable grace period permitted by law) and the Commitment shall be cancelled.
|
7.2 |
Change of control
|
(a) |
the Borrowers shall promptly notify the Lender upon becoming aware of that event; and
|
(b) |
the Lender may, by not less than 10 days’ notice to the Borrowers, cancel the Facility and declare the Loan, together with accrued interest, and all other amounts accrued under the Finance Documents
immediately due and payable, whereupon the Facility will be cancelled and the Loan and all such outstanding interest and other amounts will become immediately due and payable.
|
7.3 |
Voluntary and automatic cancellation
|
(a) |
The Borrowers may, if they give the Lender not less than 7 Business Days’ (or such shorter period as the Lender may agree) prior notice, cancel the whole or any part (being a minimum amount of $1,000,000 and
thereafter in integral multiples of $100,000) of the Available Facility.
|
(b) |
The unutilised Commitment (if any) shall be automatically cancelled at close of business on the relevant Utilisation Date or, as the case may be, at the end of the Availability Period.
|
7.4 |
Voluntary prepayment of Loan
|
(a) |
The Borrowers may, if they give the Lender not less than 30 days (or such shorter period as the Lender may agree) prior notice, prepay the whole or any part of a Tranche (but, if in part, being an amount that
reduces the amount of such Tranche by a minimum amount of $1,000,000 (and thereafter in integral multiples of $100,000)) after the last day of the Availability Period in respect of that Tranche, provided that such notice may not be served
within 12 months from the last Utilisation to occur.
|
(b) |
Any partial prepayment under this Clause 7.4 (Voluntary prepayment of Loan) shall reduce pro rata the amount of each
Repayment Instalment falling after that prepayment by the amount prepaid.
|
7.5 |
Mandatory prepayment on sale, arrest or Total Loss
|
(a) |
In this Clause 7.5 (Mandatory prepayment on sale, arrest or Total Loss):
|
(a) |
in the case of a sale of a Ship, on or before the date on which the sale is completed by delivery of that Ship to the buyer of that Ship; or
|
(b) |
in the case of a Total Loss of a Ship, on the earlier of (i) the date falling 30 days after the Total Loss Date and (ii) the date of receipt by the Lender of the proceeds of insurance relating to such Total
Loss; or
|
(c) |
in the case of an arrest of a Ship or its detention in the exercise or the purported exercise of any lien or claim unless it is redelivered to the full control of the relevant Borrower within 30 days of such
arrest or detention.
|
7.6 |
Restrictions
|
(a) |
Any notice of cancellation or prepayment given by any Party under this Clause 7 (Prepayment and Cancellation) 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.
|
(b) |
Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and subject to the fee provided for in Clause 11.3 (Prepayment and
Cancellation Fee) and any Break Costs, without premium or penalty.
|
(c) |
Neither Borrower may reborrow any part of the Facility which is prepaid.
|
(d) |
Neither Borrower shall repay or prepay all or any part of the Loan or cancel all or any part of the Commitment except at the times and in the manner expressly provided for in this Agreement.
|
(e) |
No amount of the Commitment cancelled under this Agreement may be subsequently reinstated.
|
8 |
INTEREST
|
8.1 |
Calculation of interest
|
(a) |
the Margin; and
|
(b) |
LIBOR.
|
8.2 |
Payment of interest
|
(a) |
The Borrowers shall pay accrued interest on each Tranche on the last day of each Interest Period relating to that Tranche (each an “Interest Payment Date”).
|
(b) |
If an Interest Period is longer than one Month, the Borrowers shall also pay interest then accrued on the Loan or the relevant part of the Loan on the dates falling at one Monthly interval after the first day
of the Interest Period.
|
8.3 |
Default interest
|
(a) |
If a Transaction Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the Unpaid Sum from the due date up to the date of actual payment (both before
and after judgment) at a rate which, subject to paragraph (b) below, is 2.0 per cent. per annum higher than the rate which would have been payable if the Unpaid Sum had, during the period of non-payment, constituted part of the Loan in the
currency of the Unpaid Sum for successive Interest Periods, each of a duration selected by the Lender. Any interest accruing under this Clause 8.3 (Default interest) shall be immediately payable by
the Obligors on demand by the Lender.
|
(b) |
If an Unpaid Sum consists of all or part of the Loan which became due on a day which was not the last day of an Interest Period relating to the Loan or that part of the Loan:
|
(i) |
the first Interest Period for that Unpaid Sum shall have a duration equal to the unexpired portion of the current Interest Period relating to the Loan or that part of the Loan; and
|
(ii) |
the rate of interest applying to that Unpaid Sum during that first Interest Period shall be 2.0 per cent. per annum higher than the rate which would have applied if that Unpaid Sum had not become due.
|
(c) |
Default interest (if unpaid) arising on an Unpaid Sum will be compounded with the Unpaid Sum at the end of each Interest Period applicable to that Unpaid Sum but will remain immediately due and payable.
|
8.4 |
Notification of rates of interest
|
9 |
INTEREST PERIODS
|
9.1 |
Selection of Interest Periods
|
(a) |
Each Interest Period will be one Month.
|
(b) |
Subject to this Clause 9 (Interest Periods), the Borrowers may select an Interest Period agreed between the Borrowers and the Lender and described accordingly in a
Selection Notice.
|
(c) |
Each Selection Notice is irrevocable and must be delivered to the Lender by the Borrowers not later than the Specified Time.
|
(d) |
An Interest Period in respect of a Tranche shall not extend beyond the Termination Date.
|
(e) |
The first Interest Period for the Loan shall start on the first Utilisation Date and, subject to paragraph (f) below, each subsequent Interest Period shall start on the last day of the preceding Interest
Period.
|
(f) |
The first Interest Period for the second and each subsequent Advance shall start on the Utilisation Date of such Advance and end on the last day of the Interest Period applicable to the Loan on the date on
which such Advance is made.
|
(g) |
Except for the purposes of paragraph (f) above, the Loan shall have one Interest Period only at any time.
|
9.2 |
Non-Business Days
|
10 |
CHANGES TO THE CALCULATION OF INTEREST
|
10.1 |
Unavailability of Screen Rate
|
(a) |
Interpolated Screen Rate: If no Screen Rate is available for LIBOR for the Interest Period of the Loan or any part of the Loan, the applicable LIBOR shall be the
Interpolated Screen Rate for a period equal in length to the Interest Period of the Loan or that part of the Loan.
|
(b) |
Cost of funds: If no Screen Rate is available for LIBOR for:
|
(i) |
dollars; or
|
(ii) |
the Interest Period of the Loan or any part of the Loan and it is not possible to calculate the Interpolated Screen Rate,
|
10.2 |
Market disruption
|
10.3 |
Cost of funds
|
(a) |
If this Clause 10.3 (Cost of funds) applies, the rate of interest on the Loan or the relevant part of the Loan for the relevant Interest Period shall be the percentage
rate per annum which is the sum of:
|
(i) |
the Margin; and
|
(ii) |
the rate notified by the Lender to the Borrowers as soon as practicable and in any event before 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 Lender of funding the Loan or that part of the Loan from whatever source it may reasonably select or, if such rate is less than zero, such rate shall be deemed to be zero.
|
(b) |
If this Clause 10.3 (Cost of funds) applies and the Lender or the Borrowers so require, the Lender and the Borrowers 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 or (as the case may be) an alternative basis for funding.
|
(c) |
Any substitute or alternative basis agreed pursuant to paragraph (b) above shall, be binding on all Parties.
|
10.4 |
Break Costs
|
11 |
FEES
|
11.1 |
Facility fee
|
11.2 |
Commitment fee
|
11.3 |
Prepayment and Cancellation Fee
|
(a) |
If the Borrowers request to prepay or cancel the whole or any part of the Loan within 24 months from the last Utilisation to occur, they must pay to the Lender a prepayment fee in an amount equal to 1 per
cent. of the amount prepaid or canceled on the date of such prepayment or cancellation, as applicable, of all or part of the Loan.
|
(b) |
This Clause 11.3 (Prepayment and Cancellation Fee) shall not apply in the case of a prepayment made pursuant to Clause 7.1 (Illegality)
and Clause 28.1 (Assignment by the Lender).
|
12 |
TAX GROSS UP AND INDEMNITIES
|
12.1 |
Definitions
|
(a) |
In this Agreement:
|
(b) |
Unless a contrary indication appears, in this Clause 12 (Tax Gross Up and Indemnities) 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 without any Tax Deduction, unless a Tax Deduction is required by law.
|
(b) |
The Borrowers shall promptly upon 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 Lender accordingly. Similarly,
the Lender shall notify the Borrowers and that Obligor on becoming so aware in respect of a payment payable to the Lender.
|
(c) |
If a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor 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 Lender evidence reasonably
satisfactory to the Lender that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.
|
12.3 |
Tax indemnity
|
(a) |
The Obligors shall (within three Business Days of demand by the Lender) pay to the Lender an amount equal to the loss, liability or cost which the Lender determines will be or has been (directly or
indirectly) suffered for or on account of Tax by the Lender in respect of a Finance Document.
|
(b) |
Paragraph (a) above shall not apply:
|
(i) |
with respect to any Tax assessed on the Lender:
|
(A) |
under the law of the jurisdiction in which the Lender is incorporated or, if different, the jurisdiction (or jurisdictions) in which the Lender is treated as resident for tax purposes; or
|
(B) |
under the law of the jurisdiction in which the Lender’s Facility Office is located in respect of amounts received or receivable in that jurisdiction,
|
(ii) |
to the extent a loss, liability or cost:
|
(A) |
is compensated for by an increased payment under Clause 12.2 (Tax gross-up); or
|
(B) |
relates to a FATCA Deduction required to be made by a Party.
|
(c) |
The Lender shall, if making, or intending to make, a claim under paragraph (a) above, promptly notify the Obligors of the event which will give, or has given, rise to the claim.
|
12.4 |
Tax Credit
|
(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 received; and
|
(b) |
the Lender has obtained and utilised that Tax Credit,
|
12.5 |
Stamp taxes
|
12.6 |
VAT
|
(a) |
All amounts expressed to be payable under a Finance Document by any Party to the Lender which (in whole or in part) constitute the consideration for any supply for VAT purposes are deemed to be exclusive of
any VAT which is chargeable on that supply, and accordingly, if VAT is or becomes chargeable on any supply made by the Lender to any Party under a Finance Document and the Lender is required to account to the relevant tax authority for the
VAT, that Party must pay to the Lender (in addition to and at the same time as paying any other consideration for such supply) an amount equal to the amount of the VAT (and the Lender must promptly provide an appropriate VAT invoice to that
Party).
|
(b) |
Where a Finance Document requires any Party to reimburse or indemnify the Lender for any cost or expense, that Party shall reimburse or indemnify (as the case may be) the Lender for the full amount of such
cost or expense, including such part of it as represents VAT, save to the extent that the Lender reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.
|
(c) |
Any reference in this Clause 12.6 (VAT) to any Party shall, at any time when that Party is treated as a member of a group or unity (or fiscal unity) for VAT purposes,
include (where appropriate and unless the context otherwise requires) a reference to the person who is treated at that time as making the supply, or (as appropriate) receiving the supply, under the grouping rules provided for in Article 11
of Council Directive 2006/112/EC (or as implemented by the relevant member state of the European Union or equivalent provisions imposed elsewhere) so that a reference to a Party shall be construed as a reference to that Party or the
relevant group or unity (or fiscal unity) of which that Party is a member for VAT purposes at the relevant time or the relevant representative member (or representative or head) of that group or unity at the relevant time (as the case may
be).
|
(d) |
In relation to any supply made by the Lender to any Party under a Finance Document, if reasonably requested by the Lender, that Party must promptly provide the Lender with details of that Party’s VAT
registration and such other information as is reasonably requested in connection with the Lender’s VAT reporting requirements in relation to such supply.
|
12.7 |
FATCA Information
|
(a) |
Subject to paragraph (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
|
(B) |
not a FATCA Exempt Party; and
|
(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 sub-paragraph (i) of paragraph (a) 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) |
Paragraph (a) above shall not oblige the Lender to do anything and sub-paragraph (iii) of paragraph (a) 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 sub-paragraphs (i) or (ii) of paragraph (a) above
(including, for the avoidance of doubt, where paragraph (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.
|
12.8 |
FATCA Deduction
|
(a) |
Each Party may make any FATCA Deduction it is required to make by FATCA, 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.
|
13 |
INCREASED COSTS
|
13.1 |
Increased costs
|
(a) |
Subject to Clause 13.3 (Exceptions), the Borrowers shall, within five Business Days of a demand by the Lender, pay for the account of the Lender the amount of any
Increased Costs incurred by the Lender or any of its Affiliates as a result of:
|
(i) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation; or
|
(ii) |
compliance with any law or regulation made,
|
(iii) |
the implementation, application of or compliance with Basel III or CRD IV or any law or regulation that implements or applies Basel III or CRD IV.
|
(b) |
In this Agreement:
|
(i) |
“Basel III” means:
|
(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;
|
(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; and
|
(C) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”.
|
(ii) |
“CRD IV” means:
|
(A) |
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending regulation (EU) No. 648/2012, as
amended by Regulation (EU) 2019/876;
|
(B) |
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms,
amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, as amended by Directive (EU) 2019/878; and
|
(C) |
any other law or regulation which implements Basel III.
|
(iii) |
“Increased Costs” means:
|
(A) |
a reduction in the rate of return from the Facility or on the Lender’s (or its Affiliate’s) overall capital;
|
(B) |
an additional or increased cost; or
|
(C) |
a reduction of any amount due and payable under any Finance Document,
|
13.2 |
Increased cost claims
|
13.3 |
Exceptions
|
(a) |
attributable to a Tax Deduction required by law to be made by an Obligor;
|
(b) |
attributable to a FATCA Deduction required to be made by a Party;
|
(c) |
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 paragraph (b) of Clause 12.3 (Tax indemnity) applied); or
|
(d) |
attributable to the wilful breach by the Lender or its Affiliates of any law or regulation.
|
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; or
|
(ii) |
obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,
|
(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) |
Each Obligor shall, on demand, indemnify the Lender and any Receiver and Delegate against:
|
(i) |
any cost, loss or liability incurred by it as a result of:
|
(A) |
the occurrence of any Event of Default;
|
(B) |
a failure by a Transaction Obligor to pay any amount due under a Finance Document on its due date;
|
(C) |
funding, or making arrangements to fund, an Advance 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 the Lender alone); or
|
(D) |
the Loan (or part of the Loan) not being prepaid in accordance with a notice of prepayment given by the Borrowers; or
|
(E) |
investigating any event which it reasonably believes is a Default; and
|
(ii) |
any cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by the Lender (otherwise than by reason of the Lender’s gross negligence or
wilful misconduct) or, in the case of any cost, loss or liability pursuant to Clause 30.8 (Disruption to Payment Systems etc.) notwithstanding the Lender’s negligence, gross negligence or any other
category of liability whatsoever but not including any claim based on the fraud of the Lender in acting as Lender under the Finance Documents.
|
(b) |
Each Obligor shall, on demand, indemnify the Lender, each Affiliate of the Lender and any Receiver and Delegate and each officer or employee of the Lender or its Affiliate or any Receiver or Delegate (as
applicable) (each such person for the purposes of this Clause 14.2 (Other indemnities) an “Indemnified Person”), against any cost, loss or liability
(including, without limitation, for negligence or any other category of liability whatsoever) incurred by that Indemnified Person pursuant to or in connection with any litigation, arbitration or administrative proceedings or regulatory
enquiry, in connection with or arising out of the entry into and the transactions contemplated by the Finance Documents, having the benefit of any Security constituted by the Finance Documents or which relates to the condition or operation
of, or any incident occurring in relation to, any Ship unless such cost, loss or liability is caused by the gross negligence or wilful misconduct of that Indemnified Person.
|
(c) |
No Party other than the Lender or the Receiver or Delegate (as applicable) may take any proceedings against any officer, employee or agent of the Lender or the Receiver or Delegate (as applicable) in respect
of any claim it might have against the Lender or the Receiver or Delegate or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Transaction Document or any Security Property.
|
(d) |
Without limiting, but subject to any limitations set out in paragraph (b) above, the indemnity in paragraph (b) above shall cover any cost, loss or liability incurred by each Indemnified Person in any
jurisdiction:
|
(i) |
arising or asserted under or in connection with any law relating to safety at sea, the ISM Code, any Environmental Law or any Sanctions; or
|
(ii) |
in connection with any Environmental Claim.
|
(e) |
Each Obligor shall, on demand, indemnify the Lender and every Receiver and Delegate against any cost, loss or liability (including, without limitation, for negligence or any other category of liability
whatsoever) incurred by any of them:
|
(i) |
in relation to or as a result of:
|
(A) |
any failure by the Borrowers to comply with their obligations under Clause 16 (Costs and Expenses);
|
(B) |
acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised;
|
(C) |
the taking, holding, protection or enforcement of the Finance Documents and the Transaction Security;
|
(D) |
the exercise of any of the rights, powers, discretions, authorities and remedies vested in the Lender and each Receiver and Delegate by the Finance Documents or by law;
|
(E) |
any default by any Transaction Obligor in the performance of any of the obligations expressed to be assumed by it in the Finance Documents;
|
(F) |
any action by any Transaction Obligor which vitiates, reduces the value of, or is otherwise prejudicial to, the Transaction Security; and
|
(G) |
instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under the Finance Documents;
|
(ii) |
which otherwise relates to any of the Security Property or the performance of the terms of this Agreement or the other Finance Documents (otherwise, in each case, than by reason of the Lender’s or Receiver’s
or Delegate’s gross negligence or wilful misconduct).
|
(f) |
Any Affiliate or Receiver or Delegate or any officer or employee of the Lender, or of any of its Affiliates or any Receiver or Delegate (as applicable) may rely on this Clause 14.2 (Other indemnities) and the provisions of the Third Parties Act, subject to Clause 1.5 (Third party rights) and the provisions of the Third Parties Act.
|
15 |
MITIGATION BY THE LENDER
|
15.1 |
Mitigation
|
(a) |
The Lender shall, in consultation with the Borrowers, take all reasonable steps to mitigate any circumstances which arise and which would result in 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) |
Paragraph (a) above does not in any way limit the obligations of any Transaction Obligor under the Finance Documents.
|
15.2 |
Limitation of liability
|
(a) |
Each Obligor shall, on demand, indemnify the Lender for all costs and expenses reasonably incurred by the Lender as a result of steps taken by it under Clause 15.1 (Mitigation).
|
(b) |
The Lender is not obliged to take any steps under Clause 15.1 (Mitigation) if either:
|
(i) |
a Default has occurred and is continuing; or
|
(ii) |
in the opinion of the Lender (acting reasonably), to do so might be prejudicial to it.
|
16 |
COSTS AND EXPENSES
|
16.1 |
Transaction expenses
|
(a) |
this Agreement and any other documents referred to in this Agreement or in a Security Document; and
|
(b) |
any other Finance Documents executed after the date of this Agreement.
|
16.2 |
Amendment costs
|
(a) |
a Transaction Obligor requests an amendment, waiver or consent;
|
(b) |
an amendment is required either pursuant to Clause 30.6 (Change of currency) or to address the fact that the Screen Rate is not or is likely not to be available for
dollars; or
|
(c) |
a Transaction Obligor requests, and the Lender agrees to, the release of all or any part of the Security Assets from the Transaction Security,
|
16.3 |
Enforcement and preservation costs
|
17 |
GUARANTEE AND INDEMNITY
|
17.1 |
Guarantee and indemnity
|
(a) |
guarantees to the Lender punctual performance by each Borrower of all that Borrower’s obligations under the Finance Documents;
|
(b) |
undertakes with the Lender that whenever Borrower does not pay any amount when due under or in connection with any Finance Document, the Corporate Guarantor shall immediately on demand pay that amount as if
it were the principal obligor; and
|
(c) |
agrees with the Lender that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Lender immediately on demand
against any cost, loss or liability it incurs as a result of a Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under any Finance Document on the date when it would
have been due. The amount payable by the Corporate Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause 17 (Guarantee and Indemnity) if the amount
claimed had been recoverable on the basis of a guarantee.
|
17.2 |
Continuing guarantee
|
17.3 |
Reinstatement
|
17.4 |
Waiver of defences
|
(a) |
any time, waiver or consent granted to, or composition with, any Transaction Obligor or other person;
|
(b) |
the release of any other Transaction Obligor or any other person under the terms of any composition or arrangement with any creditor of any member of the Group;
|
(c) |
the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect or delay in perfecting, or refusal or neglect to take up or enforce, or delay in taking or enforcing any
rights against, or security over assets of, any Transaction 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 a Transaction 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;
|
(f) |
any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security; or
|
(g) |
any insolvency or similar proceedings.
|
17.5 |
Immediate recourse
|
17.6 |
Appropriations
|
(a) |
refrain from applying or enforcing any other moneys, security or rights held or received by the Lender (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 the Corporate Guarantor shall not be entitled to the benefit of the same; and
|
(b) |
hold in an interest-bearing suspense account any moneys received from the Corporate Guarantor or on account of the Corporate Guarantor’s liability under this Clause 17 (Guarantee
and Indemnity).
|
17.7 |
Deferral of Corporate Guarantor’s rights
|
(a) |
to be indemnified by a Transaction Obligor;
|
(b) |
to claim any contribution from any third party providing security for, or any other guarantor of, any Transaction 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 Lender under the Finance Documents or of any other guarantee or security taken pursuant to, or in
connection with, the Finance Documents by the Lender;
|
(d) |
to bring legal or other proceedings for an order requiring any Transaction Obligor to make any payment, or perform any obligation, in respect of which the Corporate Guarantor has given a guarantee,
undertaking or indemnity under Clause 17.1 (Guarantee and indemnity);
|
(e) |
to exercise any right of set-off against any Transaction Obligor; and/or
|
(f) |
to claim or prove as a creditor of any Transaction Obligor in competition with the Lender.
|
17.8 |
Additional security
|
17.9 |
Applicability of provisions of Guarantee to other Security
|
18 |
JOINT AND SEVERAL LIABILITY OF THE BORROWERS
|
18.1 |
Joint and several liability
|
18.2 |
Waiver of defences
|
(a) |
this Agreement being or later becoming void, unenforceable or illegal as regards the other Borrower;
|
(b) |
the Lender entering into any rescheduling, refinancing or other arrangement of any kind with the other Borrower;
|
(c) |
the Lender releasing the other Borrower or any Security created by a Finance Document;
|
(d) |
any time, waiver or consent granted to, or composition with the other Borrower or other person;
|
(e) |
the release of the other Borrower or any other person under the terms of any composition or arrangement with any creditor of any member of the Group;
|
(f) |
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, the other Borrower 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;
|
(g) |
any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of the other Borrower or any other person;
|
(h) |
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 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;
|
(i) |
any unenforceability, illegality or invalidity of any obligation or any person under any Finance Document or any other document or security; or
|
(j) |
any insolvency or similar proceedings.
|
18.3 |
Principal Debtor
|
18.4 |
Borrower restrictions
|
(a) |
Subject to paragraph (b) below, during the Security Period neither Borrower shall:
|
(i) |
claim any amount which may be due to it from the other Borrower whether in respect of a payment made under, or matter arising out of, this Agreement or any Finance Document, or any matter unconnected with
this Agreement or any Finance Document;
|
(ii) |
take or enforce any form of security from the other Borrower for such an amount, or in any way seek to have recourse in respect of such an amount against any asset of the other Borrower;
|
(iii) |
set off such an amount against any sum due from it to the other Borrower;
|
(iv) |
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving the other Borrower; or
|
(v) |
exercise or assert any combination of the foregoing.
|
(b) |
If during the Security Period, the Lender, by notice to a Borrower, requires it to take any action referred to in paragraph (a) above in relation to the other Borrower, that Borrower shall take that action as
soon as practicable after receiving the Lender’s notice.
|
18.5 |
Deferral of Borrowers’ rights
|
(a) |
to be indemnified by the other Borrower; or
|
(b) |
to claim any contribution from the other Borrower in relation to any payment made by it under the Finance Documents.
|
19 |
REPRESENTATIONS
|
19.1 |
General
|
19.2 |
Status
|
(a) |
It and each other Transaction Obligor is a corporation, duly incorporated and validly existing in good standing under the law of its Original Jurisdiction.
|
(b) |
It and each other Transaction Obligor has the power to own its assets and carry on its business as it is being conducted.
|
19.3 |
Share capital and ownership
|
(a) |
Each Borrower is authorised to issue 500 registered shares with no par value.
|
(b) |
The legal title to and beneficial interest in the shares in each Borrower is held by the Shareholder free of any Security (other than Permitted Security) or any other claim.
|
(c) |
None of the shares in either Borrower is subject to any option to purchase, pre-emption rights or similar rights.
|
19.4 |
Binding obligations
|
19.5 |
Validity, effectiveness and ranking of Security
|
(a) |
Each Finance Document to which each Transaction Obligor is a party does now or, as the case may be, will upon execution and delivery create the Security it purports to create over any assets to which such
Security, by its terms, relates, and such Security will, when created or intended to be created, be valid and effective.
|
(b) |
No third party has or will have any Security (except for Permitted Security) over any assets that are the subject of any Transaction Security granted by each Transaction Obligor.
|
(c) |
The Transaction Security granted by each Transaction Obligor to the Lender has or will when created or intended to be created have first ranking priority or such other priority it is expressed to have in the
Finance Documents and is not subject to any prior ranking or pari passu ranking Security.
|
(d) |
No concurrence, consent or authorisation of any person is required for the creation of or otherwise in connection with any Transaction Security.
|
19.6 |
Non-conflict with other obligations
|
(a) |
any law or regulation applicable to it;
|
(b) |
its constitutional documents, if applicable; or
|
(c) |
any agreement or instrument binding upon it or any of its assets or constitute a default or termination event (however described) under any such agreement or instrument.
|
19.7 |
Power and authority
|
(a) |
Each Transaction Obligor has the power to enter into, perform and deliver, and has taken all necessary action to authorise:
|
(i) |
its entry into, performance and delivery of, each Transaction Document to which it is or will be a party and the transactions contemplated by those Transaction Documents; and
|
(ii) |
in the case of a Borrower, its registration of its Ship under the Approved Flag.
|
(b) |
No limit on its powers will be exceeded as a result of the borrowing, granting of security or giving of guarantees or indemnities contemplated by the Transaction Documents to which each corporate Transaction
Obligor is a party.
|
19.8 |
Validity and admissibility in evidence
|
(a) |
to enable each Transaction Obligor lawfully to enter into, exercise its rights and comply with its obligations in the Transaction Documents to which it is a party; and
|
(b) |
to make the Transaction Documents to which it is a party admissible in evidence in its Relevant Jurisdictions,
|
19.9 |
Governing law and enforcement
|
(a) |
The choice of governing law of each Transaction Document to which each Transaction Obligor is a party will be recognised and enforced in its Relevant Jurisdictions.
|
(b) |
Any judgment obtained in relation to a Transaction Document to which each Transaction Obligor is a party in the jurisdiction of the governing law of that Transaction Document will be recognised and enforced
in its Relevant Jurisdictions.
|
19.10 |
Insolvency
|
(a) |
corporate action, legal proceeding or other procedure or step described in paragraph (a) of Clause 27.8 (Insolvency proceedings); or
|
(b) |
creditors’ process described in Clause 27.9 (Creditors’ process),
|
19.11 |
No filing or stamp taxes
|
19.12 |
Deduction of Tax
|
19.13 |
No default
|
(a) |
No Event of Default and, on the date of this Agreement and on each Utilisation Date, no Default is continuing or might reasonably be expected to result from the making of a Utilisation or the entry into, the
performance of, or any transaction contemplated by, any Transaction Document.
|
(b) |
No other event or circumstance is outstanding which constitutes a default or a termination event (however described) under any other agreement or instrument which is binding on it or to which its assets are
subject.
|
19.14 |
No misleading information
|
(a) |
Any factual information provided by any member of the Group for the purposes of this Agreement was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which
it is stated.
|
(b) |
The financial projections contained in any such information have been prepared on the basis of recent historical information and on the basis of reasonable assumptions.
|
(c) |
Nothing has occurred or been omitted from any such information and no information has been given or withheld that results in any such information being untrue or misleading in any material respect.
|
19.15 |
Financial Statements
|
(a) |
The Original Financial Statements were prepared in accordance with GAAP consistently applied.
|
(b) |
The Original Financial Statements give a true and fair view of the Group’s financial condition as at the end of the relevant financial year and its results of operations during the relevant financial year
(consolidated in the case of the Corporate Guarantor).
|
(c) |
There has been no material adverse change in its assets, business or financial condition (or the assets, business or consolidated financial condition of the Group, in the case of the Corporate Guarantor)
since 31 December 2020.
|
(d) |
Its most recent financial statements delivered pursuant to Clause 20.2 (Financial statements):
|
(i) |
have been prepared in accordance with Clause 20.3 (Requirements as to financial statements); and
|
(ii) |
give a true and fair view of (if audited) or fairly represent (if unaudited) its financial condition as at the end of the relevant financial year and operations during the relevant financial year
(consolidated in the case of the Corporate Guarantor).
|
(e) |
Since the date of the most recent financial statements delivered pursuant to Clause 20.2 (Financial statements) there has been no material adverse change in its
business, assets or financial condition (or the business or consolidated financial condition of the Group, in the case of the Corporate Guarantor).
|
19.16 |
Pari passu ranking
|
19.17 |
No proceedings pending or threatened
|
(a) |
No material litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code) of or
before any court, arbitral body or agency have (to the best of its knowledge and belief (having made due and careful enquiry)) been started or threatened against it or any other Transaction Obligor.
|
(b) |
No judgment or order of a court, arbitral tribunal or other tribunal or any order or sanction of any governmental or other regulatory body has (to the best of its knowledge and belief (having made due and
careful enquiry)) been made against it or any other Transaction Obligor.
|
19.18 |
Valuations
|
(a) |
All information supplied by it or on its behalf to an Approved Valuer for the purposes of a valuation delivered to the Lender in accordance with this Agreement was true and accurate as at the date it was
supplied or (if appropriate) as at the date (if any) at which it is stated to be given.
|
(b) |
It has not omitted to supply any information to an Approved Valuer which, if disclosed, would adversely affect any valuation prepared by such Approved Valuer.
|
(c) |
There has been no change to the factual information provided pursuant to paragraph (a) above in relation to any valuation between the date such information was provided and the date of that valuation which,
in either case, renders that information untrue or misleading in any material respect.
|
19.19 |
No breach of laws
|
19.20 |
No Charter
|
19.21 |
Compliance with Environmental Laws
|
19.22 |
No Environmental Claim
|
19.23 |
No Environmental Incident
|
19.24 |
ISM and ISPS Code compliance
|
19.25 |
Taxes paid
|
(a) |
It is not and no other member of the Group is materially overdue in the filing of any Tax returns and it is not (and no other member of the Group is) overdue in the payment of any amount in respect of Tax.
|
(b) |
No claims or investigations are being, or are reasonably likely to be, made or conducted against it (or any other member of the Group) with respect to Taxes.
|
19.26 |
Financial Indebtedness
|
19.27 |
Overseas companies
|
19.28 |
Good title to assets
|
19.29 |
Ownership
|
(a) |
Borrower A is the sole legal and beneficial owner of Ship A, its Earnings and its Insurances.
|
(b) |
Borrower B is the sole legal and beneficial owner of Ship B, its Earnings and its Insurances.
|
(c) |
With effect on and from the date of its creation or intended creation, each Transaction Obligor will be the sole legal and beneficial owner of any asset that is the subject of any Transaction Security created
or intended to be created by such Transaction Obligor.
|
(d) |
The constitutional documents of each Transaction Obligor do not and could not restrict or inhibit any transfer of the shares of the Borrowers on creation or enforcement of the security conferred by the
Security Documents.
|
19.30 |
Centre of main interests and establishments
|
19.31 |
Place of business
|
19.32 |
No employee or pension arrangements
|
19.33 |
Sanctions
|
(a) |
No Transaction Obligor:
|
(i) |
is a Prohibited Person;
|
(ii) |
is owned or controlled by or acting directly or indirectly on behalf of or for the benefit of, a Prohibited Person;
|
(iii) |
owns or controls a Prohibited Person; or
|
(iv) |
has a Prohibited Person serving as a director, officer or, to the best of its knowledge, employee.
|
(b) |
No proceeds of the Loan or any part of the Loan shall be made available, directly or indirectly, to or for the benefit of a Prohibited Person nor shall they be otherwise directly or indirectly, applied in a
manner or for a purpose prohibited by Sanctions.
|
19.34 |
US Tax Obligor
|
19.35 |
Repetition
|
20 |
INFORMATION UNDERTAKINGS
|
20.1 |
General
|
20.2 |
Financial statements
|
(a) |
in the case of the Borrowers, if available, but in any event within 120 days after the end of each of their respective financial years their respective unaudited non consolidated financial statements for that
financial year (or any financial statements in the form satisfactory to the Lender);
|
(b) |
in the case of the Corporate Guarantor, as soon as they same become available, but in any event within 120 days after the end of each of its financial years, the Corporate Guarantor’s audited consolidated
financial statements for that financial year (or any financial statements in the form satisfactory to the Lender); and
|
(c) |
as soon as they become available, but in any event within 90 days after the end of each half of each financial year of the Corporate Guarantor, the Corporate Guarantor’s unaudited consolidated financial
statements for that financial half year (or any financial statements in the form satisfactory to the Lender).
|
20.3 |
Requirements as to financial statements
|
(a) |
Each set of financial statements delivered by a Borrower or the Corporate Guarantor (as the case may be) pursuant to Clause 20.2 (Financial statements) shall be
certified by a senior officer of the relevant company as giving a true and fair view (if audited) or fairly representing (if unaudited) its financial condition and operations as at the date as at which those financial statements were drawn
up.
|
(b) |
The Borrowers shall procure that each set of financial statements delivered pursuant to Clause 20.2 (Financial statements) is prepared using GAAP.
|
(c) |
Each set of financial statements delivered by a Borrower or the Corporate Guarantor (as the case may be) pursuant to paragraphs (a) and (b) of Clause 20.2 (Financial
statements) shall not contain any qualification by an auditor.
|
20.4 |
Information: miscellaneous
|
(a) |
all documents dispatched by it to its shareholders (or any class of them) or its creditors generally at the same time as they are dispatched;
|
(b) |
promptly upon becoming aware of them, the details of any material litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or
actual breach of the ISM Code or of the ISPS Code) which are current, threatened or pending against any member of the Group;
|
(c) |
promptly upon becoming aware of them, the details of any judgment or order of a court, arbitral body or agency which is made against any member of the Group;
|
(d) |
promptly, its constitutional documents where these have been amended or varied;
|
(e) |
promptly, such further information and/or documents regarding:
|
(i) |
each Ship, goods transported on each Ship, its Earnings and its Insurances;
|
(ii) |
the Security Assets;
|
(iii) |
compliance of the Transaction Obligors with the terms of the Finance Documents;
|
(iv) |
the financial condition, business and operations of the Obligors,
|
(f) |
promptly, such further information and/or documents as the Lender may reasonably request so as to enable the Lender to comply with any laws applicable to it or as may be required by any regulatory authority.
|
20.5 |
Notification of Default
|
(a) |
Each Obligor shall, and shall procure that each other Transaction Obligor shall, notify the Lender of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its
occurrence.
|
(b) |
Promptly upon a request by the Lender, each Borrower shall supply to the Lender a certificate signed by two of its senior officers (or, as the case may be, by its sole senior officer) on its behalf certifying
that no Default is continuing (or if a Default is continuing, specifying the Default and the steps, if any, being taken to remedy it).
|
20.6 |
“Know your customer” checks
|
(a) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
|
(b) |
any change in the status of a Transaction Obligor (or the Holding Company of a Transaction Obligor) (including, without limitation, a change of ownership of a Transaction Obligor or the Holding Company of a
Transaction Obligor) after the date of this Agreement; or
|
(c) |
a proposed assignment by the Lender of any of its rights under this Agreement,
|
21 |
FINANCIAL COVENANTS
|
21.1 |
Minimum Liquidity Amount
|
21.2 |
Application of Minimum Liquidity Amount in the case of Mandatory Prepayment and Event of Default
|
21.3 |
Release of Minimum Liquidity Amount
|
21.4 |
Minimum Liquidity Amount in the case of insolvency of the Lender
|
(a) |
the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Lender
and/or the Minimum Liquidity Account Bank;
|
(b) |
the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of the Lender and/or the Minimum Liquidity Account Bank or any of its
assets; or
|
(c) |
enforcement of any Security over any assets of the Lender and/or the Minimum Liquidity Account Bank,
|
22 |
GENERAL UNDERTAKINGS
|
22.1 |
General
|
22.2 |
Authorisations
|
(a) |
obtain, comply with and do all that is necessary to maintain in full force and effect; and
|
(b) |
supply certified copies to the Lender of, any Authorisation required under any law or regulation of a Relevant Jurisdiction or the state of the Approved Flag at any time of each Ship to enable it to:
|
(i) |
perform its obligations under the Transaction Documents to which it is a party;
|
(ii) |
ensure the legality, validity, enforceability or admissibility in evidence in any Relevant Jurisdiction or in the state of the Approved Flag at any time of each Ship of any Transaction Document to which it is
a party; and
|
(iii) |
own and operate each Ship (in the case of the Borrowers).
|
22.3 |
Compliance with laws
|
22.4 |
Environmental compliance
|
(a) |
comply with all Environmental Laws;
|
(b) |
obtain, maintain and ensure compliance with all requisite Environmental Approvals; and
|
(c) |
implement procedures to monitor compliance with and to prevent liability under any Environmental Law.
|
22.5 |
Environmental Claims
|
(a) |
any Environmental Claim against any Obligor which is current, pending or threatened and is expected to exceed $500,000; and
|
(b) |
any facts or circumstances which are reasonably likely to result in any Environmental Claim being commenced or threatened against any Obligor where such claim is expected to exceed $500,000 or any member of
the Group and which Environmental Claim is reasonably likely to result in a Material Adverse Effect.
|
22.6 |
Taxation
|
(a) |
Each Obligor shall, and shall procure that each other Transaction Obligor will pay and discharge all Taxes imposed upon it or its assets within the time period allowed without incurring penalties unless and
only to the extent that:
|
(i) |
such payment is being contested in good faith;
|
(ii) |
adequate reserves are maintained for those Taxes and the costs required to contest them and both have been disclosed in its latest financial statements delivered to the Lender under Clause 20.2 (Financial statements); and
|
(iii) |
such payment can be lawfully withheld.
|
(b) |
No Obligor shall and the Obligors shall procure that no other Transaction Obligor will, change its residence for Tax purposes.
|
22.7 |
Overseas companies
|
22.8 |
No change to centre of main interests
|
22.9 |
Pari passu ranking
|
22.10 |
Title
|
(a) |
Borrower A shall hold the legal title to, and own the entire beneficial interest in Ship A, its Earnings and its Insurances.
|
(b) |
Borrower B shall hold the legal title to, and own the entire beneficial interest in Ship B, its Earnings and its Insurances.
|
(c) |
With effect on and from its creation or intended creation, each Transaction Obligor shall hold the legal title to, and own the entire beneficial interest in any other assets the subject of any Transaction
Security created or intended to be created by that Transaction Obligor.
|
22.11 |
Negative pledge
|
(a) |
Neither Borrower shall, and the Borrowers shall procure that no other Transaction Obligor will, create or permit to subsist any Security over any of its assets which are, in the case of the Transaction
Obligors other than the Borrowers, the subject of the Security created or intended to be created by the Finance Documents.
|
(b) |
Neither Borrower shall:
|
(i) |
sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by a Transaction Obligor;
|
(ii) |
sell, transfer or otherwise dispose of any of its receivables on recourse terms;
|
(iii) |
enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or
|
(iv) |
enter into any other preferential arrangement having a similar effect,
|
(c) |
Paragraphs (a) and (b) above do not apply to any Permitted Security.
|
22.12 |
Disposals
|
(a) |
Neither Borrower shall, enter into a single transaction or a series of transactions (whether related or not) and whether voluntary or involuntary to sell, lease, transfer or otherwise dispose of any asset
(including without limitation any Ship, its Earnings or its Insurances).
|
(b) |
Paragraph (a) above does not apply to:
|
(i) |
any Charter as all Charters are subject to Clause 24.16 (Restrictions on chartering, appointment of managers etc.); and
|
(ii) |
any sale in respect of a Ship provided that the proceeds of such sale are sufficient to pay any amounts payable pursuant to Clause 7.5 (Mandatory prepayment on sale, arrest or Total Loss).
|
22.13 |
Merger
|
(a) |
No Obligor shall, and the Obligors shall procure that no other Transaction Obligor will, enter into any amalgamation, demerger, merger, consolidation, or corporate reconstruction.
|
(b) |
Paragraph (a) of this Clause 22.13 (Merger) shall not be applicable to any Transaction Obligor (other than the Borrowers) if in the case of such amalgamation,
demerger, merger, consolidation, or corporate reconstruction between that Transaction Obligor and another entity, that Transaction Obligor remains the surviving entity of that amalgamation, demerger, merger, consolidation, or corporate
reconstruction and as long as, no Event of Default has occurred and is continuing.
|
22.14 |
Change of business
|
(a) |
The Obligors shall procure that no substantial change is made to the general nature of their business from that carried on at the date of this Agreement.
|
(b) |
Neither Borrower shall engage in any business other than the ownership and operation of its Ship.
|
22.15 |
Financial Indebtedness
|
22.16 |
Expenditure
|
22.17 |
Share capital
|
(a) |
purchase, cancel or redeem any of its shares;
|
(b) |
increase or reduce its authorised shares;
|
(c) |
issue any further shares except to the Shareholders and provided such new shares are made subject to the terms of the Shares Security applicable to that Borrower immediately upon the issue of such new shares
in a manner satisfactory to the Lender and the terms of that Shares Security are complied with;
|
(d) |
appoint any further director, officer or secretary of that Borrower (unless the provisions of the Shares Security applicable to that Borrower are complied with).
|
22.18 |
Dividends
|
(a) |
declare, make or pay any dividend, charge, fee or other distribution (or interest on any unpaid dividend, charge, fee or other distribution) (whether in cash or in kind) on or in respect of its shares (or any
class of its shares);
|
(b) |
repay or distribute any dividend or share premium reserve;
|
(c) |
pay any management, advisory or other fee to or to the order of any of its shareholders; or
|
(d) |
redeem, repurchase, defease, retire or repay any of its shares or resolve to do so.
|
22.19 |
Other transactions
|
(a) |
be the creditor in respect of any loan or any form of credit to any person other than another Transaction Obligor or a member of the Group and where such loan or form of credit is Permitted Financial
Indebtedness;
|
(b) |
give or allow to be outstanding any guarantee or indemnity to or for the benefit of any person in respect of any obligation of any other person or enter into any document under which that Borrower assumes any
liability of any other person other than any guarantee or indemnity given under the Finance Documents;
|
(c) |
enter into any material agreement other than:
|
(i) |
the Transaction Documents;
|
(ii) |
any other agreement expressly allowed under any other term of this Agreement; and
|
(d) |
enter into any transaction on terms which are, in any respect, less favourable to that Borrower than those which it could obtain in a bargain made at arms’ length; or
|
(e) |
acquire any shares or other securities other than US or UK Treasury bills and certificates of deposit issued by major North American or European banks.
|
22.20 |
Unlawfulness, invalidity and ranking; Security imperilled
|
(a) |
make it unlawful for a Transaction Obligor to perform any of its obligations under the Transaction Documents;
|
(b) |
cause any obligation of a Transaction Obligor under the Transaction Documents to cease to be legal, valid, binding or enforceable;
|
(c) |
cause any Transaction Document to cease to be in full force and effect;
|
(d) |
cause any Transaction Security to rank after, or lose its priority to, any other Security; and
|
(e) |
imperil or jeopardise the Transaction Security.
|
22.21 |
Insurance
|
22.22 |
Further assurance
|
(a) |
Each Obligor shall, and shall procure that each other Transaction Obligor will promptly, and in any event within the reasonable time period specified by the Lender do all such acts (including procuring or
arranging any registration, notarisation or authentication or the giving of any notice) or execute or procure execution of all such documents (including assignments, transfers, mortgages, charges, notices, instructions, acknowledgments,
proxies and powers of attorney), as the Lender may specify (and in such form as the Lender may require in favour of the Lender or its nominee(s)):
|
(i) |
to create, perfect, vest in favour of the Lender or protect the priority of the Security or any right of any kind created or intended to be created under or evidenced by the Finance Documents (which may
include the execution of a mortgage, charge, assignment or other Security over all or any of the assets which are, or are intended to be, the subject of the Transaction Security) or for the exercise of any rights, powers and remedies of the
Lender or any Receiver or Delegate provided by or pursuant to the Finance Documents or by law;
|
(ii) |
to confer on the Lender Security over any property and assets of that Transaction Obligor located in any jurisdiction equivalent or similar to the Security intended to be conferred by or pursuant to the
Finance Documents;
|
(iii) |
to facilitate or expedite the realisation and/or sale of, the transfer of title to or the grant of, any interest in or right relating to the assets which are, or are intended to be, the subject of the
Transaction Security or to exercise any power specified in any Finance Document in respect of which the Security has become enforceable; and/or
|
(iv) |
to enable or assist the Lender to enter into any transaction to commence, defend or conduct any proceedings and/or to take any other action relating to any item of the Security Property.
|
(b) |
Each Obligor shall, and shall procure that each other Transaction Obligor will take all such action as is available to it (including making all filings and registrations) as may be necessary for the purpose
of the creation, perfection, protection or maintenance of any Security conferred or intended to be conferred on the Lender by or pursuant to the Finance Documents.
|
(c) |
At the same time as an Obligor delivers to the Lender any document executed by itself or another Transaction Obligor pursuant to this Clause 22.22 (Further assurance).
|
(d) |
That Obligor shall deliver, or shall procure that such other Transaction Obligor will deliver, to the Lender a certificate signed by one of that Obligor’s or Transaction Obligor’s officers which shall:
|
(i) |
set out the text of a resolution of that Obligor’s or Transaction Obligor’s directors specifically authorising the execution of the document specified by the Lender; and
|
(ii) |
state that either the resolution was duly passed at a meeting of the directors validly convened and held, throughout which a quorum of directors entitled to vote on the resolution was present, or that the
resolution has been signed by all the officers and is valid under that Obligor’s or that Transaction Obligor’s articles of association or other constitutional documents.
|
23 |
INSURANCE UNDERTAKINGS
|
23.1 |
General
|
23.2 |
Maintenance of obligatory insurances
|
(a) |
fire and usual marine risks (including hull and machinery and excess risks);
|
(b) |
war risks;
|
(c) |
protection and indemnity risks; and
|
(d) |
any other risks against which the Lender considers, having regard to practices and other circumstances prevailing at the relevant time, it would be reasonable for that Borrower to insure and which are
specified by the Lender by notice to that Borrower.
|
23.3 |
Terms of obligatory insurances
|
(a) |
in dollars;
|
(b) |
in the case of hull and machinery, fire and usual marine risks and war risks, in an amount on an agreed value basis at least the greater of:
|
(i) |
an amount which equals 120 per cent. the Tranche relevant to such Ship; and
|
(ii) |
the Market Value of that Ship;
|
(c) |
in the case of oil pollution liability risks, for an aggregate amount equal to the highest level of cover from time to time available under basic protection and indemnity club entry and in the international
marine insurance market but in any case no less than $1,000,000,000;
|
(d) |
in the case of protection and indemnity risks, in respect of the full tonnage of its Ship;
|
(e) |
on approved terms; and
|
(f) |
through Approved Brokers and with approved insurance companies and/or underwriters or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks
associations.
|
23.4 |
Further protections for the Lender
|
(a) |
subject always to paragraph (b), name that Borrower as the sole named insured unless the interest of every other named insured is limited:
|
(i) |
in respect of any obligatory insurances for hull and machinery and war risks;
|
(A) |
to any provable out-of-pocket expenses that it has incurred and which form part of any recoverable claim on underwriters; and
|
(B) |
to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against it); and
|
(ii) |
in respect of any obligatory insurances for protection and indemnity risks, to any recoveries it is entitled to make by way of reimbursement following discharge of any third party liability claims made
specifically against it;
|
(b) |
whenever the Lender requires, name (or be amended to name) the Lender as additional named insured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation
against the Lender, but without the Lender being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
|
(c) |
name the Lender as loss payee with such directions for payment as the Lender may specify;
|
(d) |
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Lender shall be made without set off, counterclaim or deductions or condition whatsoever;
|
(e) |
provide that the obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Lender; and
|
(f) |
provide that the Lender may make proof of loss if that Borrower fails to do so.
|
23.5 |
Renewal of obligatory insurances
|
(a) |
at least 21 days before the expiry of any obligatory insurance effected by it:
|
(i) |
notify the Lender of the Approved Brokers (or other insurers) and any protection and indemnity or war risks association through or with which it proposes to renew that obligatory insurance and of the proposed
terms of renewal; and
|
(ii) |
obtain the Lender’s approval to the matters referred to in sub-paragraph (i) above;
|
(b) |
at least 14 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the Lender’s approval pursuant to paragraph (a) above; and
|
(c) |
procure that the Approved Brokers and/or the approved war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal notify the Lender in writing of
the terms and conditions of the renewal.
|
23.6 |
Copies of policies; letters of undertaking
|
(a) |
pro forma copies of all policies relating to the obligatory insurances which they are to effect or renew; and
|
(b) |
a letter or letters of undertaking in a form required by the Lender and including undertakings by the Approved Brokers that:
|
(i) |
they will have endorsed on each policy, immediately upon issue, a loss payable clause and a notice of assignment complying with the provisions of Clause 23.4 (Further
protections for the Lender);
|
(ii) |
they will hold such policies, and the benefit of such insurances, to the order of the Lender in accordance with such loss payable clause;
|
(iii) |
they will advise the Lender immediately of any material change to the terms of the obligatory insurances;
|
(iv) |
they will, if they have not received notice of renewal instructions from the relevant Borrower or its agents, notify the Lender not less than 14 days before the expiry of the obligatory insurances;
|
(v) |
if they receive instructions to renew the obligatory insurances, they will promptly notify the Lender of the terms of the instructions;
|
(vi) |
they will not set off against any sum recoverable in respect of a claim relating to the Ship owned by that Borrower under such obligatory insurances any premiums or other amounts due to them or any other
person whether in respect of that Ship or otherwise, they waive any lien on the policies, or any sums received under them, which they might have in respect of such premiums or other amounts and they will not cancel such obligatory
insurances by reason of non-payment of such premiums or other amounts; and
|
(vii) |
they will arrange for a separate policy to be issued in respect of the Ship owned by that Borrower forthwith upon being so requested by the Lender.
|
23.7 |
Copies of certificates of entry
|
(a) |
a certified copy of the certificate of entry for that Ship;
|
(b) |
a letter or letters of undertaking in such form as may be required by the Lender; and
|
(c) |
a certified copy of each certificate of financial responsibility for pollution by oil or other Environmentally Sensitive Material issued by the relevant certifying authority in relation to that Ship.
|
23.8 |
Deposit of original policies
|
23.9 |
Payment of premiums
|
23.10 |
Guarantees
|
23.11 |
Compliance with terms of insurances
|
(a) |
Neither Borrower shall do or omit to do (nor permit to be done or not to be done) any act or thing which would or might render any obligatory insurance invalid, void, voidable or unenforceable or render any
sum payable under an obligatory insurance repayable in whole or in part.
|
(b) |
Without limiting paragraph (a) above, each Borrower shall:
|
(i) |
take all necessary action and comply with all requirements which may from time to time be applicable to the obligatory insurances, and (without limiting the obligation contained in sub-paragraph (iii) of
paragraph (b) of Clause 23.6 (Copies of policies; letters of undertaking)) ensure that the obligatory insurances are not made subject to any exclusions or qualifications to which the Lender has not
given its prior approval;
|
(ii) |
not make any changes relating to the classification or classification society or manager or operator of the Ship owned by it approved by the underwriters of the obligatory insurances;
|
(iii) |
make (and promptly supply copies to the Lender of) all quarterly or other voyage declarations which may be required by the protection and indemnity risks association in which the Ship owned by it is entered
to maintain cover for trading to the United States of America and Exclusive Economic Zone (as defined in the United States Oil Pollution Act 1990 or any other applicable legislation); and
|
(iv) |
not employ the Ship owned by it, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the obligatory insurances, without first obtaining the consent of the insurers and
complying with any requirements (as to extra premium or otherwise) which the insurers specify.
|
23.12 |
Alteration to terms of insurances
|
23.13 |
Settlement of claims
|
(a) |
not settle, compromise or abandon any claim under any obligatory insurance for Total Loss, Requisition or for a Major Casualty; and
|
(b) |
do all things necessary and provide all documents, evidence and information to enable the Lender to collect or recover any moneys which at any time become payable in respect of the obligatory insurances.
|
23.14 |
Provision of copies of communications
|
(a) |
the Approved Brokers;
|
(b) |
the approved protection and indemnity and/or war risks associations; and
|
(c) |
the approved insurance companies and/or underwriters,
|
(i) |
that Borrower’s obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls; and
|
(ii) |
any credit arrangements made between that Borrower and any of the persons referred to in paragraphs (a) or (b) above relating wholly or partly to the effecting or maintenance of the obligatory insurances.
|
23.15 |
Provision of information
|
(a) |
obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
|
(b) |
effecting, maintaining or renewing any such insurances as are referred to in Clause 23.16 (Mortgagee’s interest and additional perils insurances) or dealing with or
considering any matters relating to any such insurances,
|
23.16 |
Mortgagee’s interest and additional perils insurances
|
(a) |
The Lender shall be entitled from time to time to effect, maintain and renew a mortgagee’s interest marine insurance in an amount of not less than 120 per cent. of the Loan and mortgagee’s additional perils
insurance in an amount acceptable to the Lender, on such terms, through such insurers and generally in such manner as the Lender may from time to time consider appropriate.
|
(b) |
The Borrowers shall upon demand fully indemnify the Lender in respect of all premiums and other expenses which are incurred in connection with or with a view to effecting, maintaining or renewing any
insurance referred to in paragraph (a) above or dealing with, or considering, any matter arising out of any such insurance.
|
24 |
GENERAL SHIP UNDERTAKINGS
|
24.1 |
General
|
24.2 |
Ships’ names and registration
|
(a) |
keep that Ship registered in the relevant Borrower’s name under the Approved Flag from time to time at its port of registration;
|
(b) |
not do or allow to be done anything as a result of which such registration might be suspended, cancelled or imperilled;
|
(c) |
not enter into any dual flagging arrangement in respect of that Ship; and
|
(d) |
not change the name of that Ship,
|
(i) |
the Lender’s prior written consent;
|
(ii) |
that Ship remaining subject to Security securing the Secured Liabilities created by a first priority or preferred ship mortgage on that Ship and, if appropriate, a first priority deed of covenant collateral
to that mortgage (or equivalent first priority Security) on substantially the same terms as the Mortgage on that Ship and on such other terms and in such other form as the Lender shall approve or require; and
|
(iii) |
the execution of such other documentation amending and supplementing the Finance Documents as the Lender shall approve or require.
|
24.3 |
Repair and classification
|
(a) |
consistent with first class ship ownership and management practice; and
|
(b) |
so as to maintain the Approved Classification free of overdue recommendations and conditions affecting that Ship’s class.
|
24.4 |
Classification society undertaking
|
(a) |
to send to the Lender, following receipt of a written request from the Lender, certified true copies of all original class records held by the Approved Classification Society in relation to that Ship;
|
(b) |
to allow the Lender (or its agents), at any time and from time to time, to inspect the original class and related records of that Borrower and that Ship at the offices of the Approved Classification Society
and to take copies of them;
|
(c) |
to notify the Lender immediately in writing if the Approved Classification Society:
|
(i) |
receives notification from that Borrower or any person that that Ship’s Approved Classification Society is to be changed (such change to be subject to the Lender’s prior written consent); or
|
(ii) |
becomes aware of any facts or matters which may result in or have resulted in a change, suspension, discontinuance, withdrawal or expiry of that Ship’s class under the rules or terms and conditions of that
Borrower or that Ship’s membership of the Approved Classification Society;
|
(d) |
following receipt of a written request from the Lender:
|
(i) |
to confirm that that Borrower is not in default of any of its contractual obligations or liabilities to the Approved Classification Society, including confirmation that that Borrower has paid in full all fees
or other charges due and payable to the Approved Classification Society; or
|
(ii) |
to confirm that that Borrower is in default of any of its contractual obligations or liabilities to the Approved Classification Society, to specify to the Lender in reasonable detail the facts and
circumstances of such default, the consequences of such default, and any remedy period agreed or allowed by the Approved Classification Society.
|
24.5 |
Modifications
|
24.6 |
Removal and installation of parts
|
(a) |
Subject to paragraph (b) below, neither Borrower shall remove any material part of any Ship, or any item of equipment installed on any Ship unless:
|
(i) |
the part or item so removed is forthwith replaced by a suitable part or item which is in the same condition as or better condition than the part or item removed;
|
(ii) |
the replacement part or item is free from any Security in favour of any person other than the Lender; and
|
(iii) |
the replacement part or item becomes, on installation on that Ship, the property of that Borrower and subject to the security constituted by the Mortgage on that Ship.
|
(b) |
A Borrower may install equipment owned by a third party if the equipment can be removed without any risk of damage to the Ship owned by that Borrower.
|
24.7 |
Surveys
|
24.8 |
Inspection
|
24.9 |
Prevention of and release from arrest
|
(a) |
Each Borrower shall, in respect of the Ship owned by it, promptly discharge:
|
(i) |
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against that Ship, its Earnings or its Insurances;
|
(ii) |
all Taxes, dues and other amounts charged in respect of that Ship, its Earnings or its Insurances; and
|
(iii) |
all other outgoings whatsoever in respect of that Ship, its Earnings or its Insurances.
|
(b) |
Each Borrower shall, immediately upon receiving notice of the arrest of the Ship owned by it or of its detention in exercise or purported exercise of any lien or claim, take all steps necessary to procure its
release by providing bail or otherwise as the circumstances may require.
|
24.10 |
Compliance with laws etc.
|
(a) |
comply, or procure compliance with all laws or regulations:
|
(i) |
relating to its business generally; and
|
(ii) |
relating to the Ship owned or operated by it, its ownership, employment, operation, management and registration,
|
(b) |
obtain, comply with and do all that is necessary to maintain in full force and effect any Environmental Approvals; and
|
(c) |
without limiting paragraph (a) above, not employ the Ship owned or operated by it nor allow its employment, operation or management in any manner contrary to any law or regulation including but not limited to
the ISM Code, the ISPS Code, all Environmental Laws and Sanctions (or which would be contrary to Sanctions if Sanctions were binding on each Transaction Obligor).
|
24.11 |
ISPS Code
|
(a) |
procure that the Ship owned or operated by it and the company responsible for that Ship’s compliance with the ISPS Code comply with the ISPS Code;
|
(b) |
maintain an ISSC for that Ship; and
|
(c) |
notify the Lender immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
|
24.12 |
Sanctions and Ship trading
|
(a) |
that the Ship owned or operated by it shall not be used by or for the benefit of a Prohibited Person;
|
(b) |
that such Ship shall not be used in trading in any manner contrary to Sanctions (or which could be contrary to Sanctions if Sanctions were binding on each Transaction Obligor);
|
(c) |
that such Ship shall not be traded in any manner which would trigger the operation of any sanctions limitation or exclusion clause (or similar) in the Insurances; and
|
(d) |
that each charterparty in respect of that Ship shall contain, for the benefit of that Borrower, language which gives effect to the provisions of paragraph (c) of Clause 24.10 (Compliance with laws etc.) as regards Sanctions and of this Clause 24.12 (Sanctions and Ship trading) and which permits refusal of employment or voyage orders if compliance would
result in a breach of Sanctions (or which could be contrary to Sanctions if Sanctions were binding on each Transaction Obligor).
|
24.13 |
Trading in war zones or excluded areas
|
(a) |
the prior written consent of the Lender has been given; and
|
(b) |
that Borrower has (at its expense) effected any special, additional or modified insurance cover which the Lender may require.
|
24.14 |
Provision of information
|
(a) |
that Ship, its employment, position and engagements;
|
(b) |
the Earnings and payments and amounts due to its master and crew;
|
(c) |
any expenditure incurred, or likely to be incurred, in connection with the operation, maintenance or repair of that Ship and any payments made by it in respect of that Ship;
|
(d) |
any towages and salvages; and
|
(e) |
its compliance, each Approved Manager’s compliance and the compliance of that Ship with the ISM Code and the ISPS Code,
|
24.15 |
Notification of certain events
|
(a) |
any casualty to that Ship which is or is likely to be or to become a Major Casualty;
|
(b) |
any occurrence as a result of which that Ship has become or is, by the passing of time or otherwise, likely to become a Total Loss;
|
(c) |
any Requisition of a Ship;
|
(d) |
any requirement or recommendation made in relation to that Ship by any insurer or classification society or by any competent authority which is not complied with within the time frame imposed;
|
(e) |
any arrest or detention of that Ship or any exercise or purported exercise of any lien on that Ship or the Earnings;
|
(f) |
any intended dry docking of that Ship;
|
(g) |
any Environmental Claim made against that Borrower, an Approved Manager or in connection with that Ship, or any Environmental Incident;
|
(h) |
any claim for breach of the ISM Code or the ISPS Code being made against that Borrower, an Approved Manager or otherwise in connection with that Ship; or
|
(i) |
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with,
|
24.16 |
Restrictions on chartering, appointment of managers etc.
|
(a) |
let that Ship on demise charter for any period;
|
(b) |
enter into any time, voyage or consecutive voyage charter in respect of that Ship other than a Permitted Charter;
|
(c) |
amend, supplement or terminate a Management Agreement;
|
(d) |
appoint a manager of that Ship other than an Approved Manager or agree to any alteration to the terms of an Approved Manager’s appointment;
|
(e) |
de activate or lay up that Ship; or
|
(f) |
put that Ship into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed the lesser of (a) an amount equal to ten per cent. of the Loan outstanding
and (b) $500,000 (or the equivalent in any other currency) unless that person has first given to the Lender and in terms satisfactory to it a written undertaking not to exercise any lien on that Ship or its Earnings for the cost of such
work or for any other reason.
|
24.17 |
Notice of Mortgage
|
24.18 |
Sharing of Earnings
|
24.19 |
Notification of compliance
|
24.20 |
Charter Assignment
|
25 |
ACCOUNTS AND APPLICATION OF EARNINGS
|
25.1 |
Accounts
|
25.2 |
Application of Earnings
|
(a) |
in or towards making payments of all amounts due and payable by the Borrowers under this Agreement (other than payments of principal and interest);
|
(b) |
in or towards satisfaction of all amounts of interest or default interest payable to the Lender under the Finance Documents;
|
(c) |
in or towards satisfaction of the Loan;
|
(d) |
in or towards making payments of all fees due to an Approved Manager and thereafter meeting the costs and expenses from time to time incurred by or on behalf of the Borrowers in connection with the operation
of a Ship directly or via the member of the Group designated as cash manager, Castor Maritime SCR Corp.; and
|
(e) |
as to any surplus from time to time arising on an Earnings Account following application as aforesaid, to be paid to the relevant Borrower or to whomsoever it may direct including the cash manager, Castor
Maritime SCR Corp.
|
25.3 |
Payment of Earnings
|
25.4 |
Location of Accounts
|
(a) |
comply with any requirement of the Lender as to the location or relocation of its Earnings Account; and
|
(b) |
execute any documents which the Lender specifies to create or maintain in favour of the Lender Security over (and/or rights of set-off, consolidation or other rights in relation to) its Earnings Account.
|
26 |
VALUATION
|
26.1 |
Provision of information
|
(a) |
Each Borrower shall promptly provide the Lender and any shipbroker providing a Market Value any information which the Lender or the shipbroker may request for the purposes of the valuation.
|
(b) |
If a Borrower fails to provide the information referred to in paragraph (a) above by the date specified in the request, the valuation may be made on any basis and assumptions which the shipbroker or the
Lender considers prudent.
|
26.2 |
Provision of valuations
|
27 |
EVENTS OF DEFAULT
|
27.1 |
General
|
27.2 |
Non-payment
|
(a) |
its failure to pay is caused by:
|
(i) |
administrative or technical error; or
|
(ii) |
a Disruption Event; and
|
(b) |
payment is made within 5 Business Days of its due date.
|
27.3 |
Specific obligations
|
27.4 |
Other obligations
|
(a) |
A Transaction Obligor does not comply with any provision of the Finance Documents (other than those referred to in Clause 27.2 (Non-payment) and Clause 27.3 (Specific obligations)).
|
(b) |
No Event of Default under paragraph (a) above will occur if the failure to comply is capable of remedy and is remedied within 10 Business Days of the Lender giving notice to the Borrowers or (if earlier) any
Transaction Obligor becoming aware of the failure to comply.
|
27.5 |
Misrepresentation
|
27.6 |
Cross default
|
(a) |
Any Financial Indebtedness of any Obligor is not paid when due nor within any originally applicable grace period.
|
(b) |
Any Financial Indebtedness of any Obligor is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (however described).
|
(c) |
Any commitment for any Financial Indebtedness of any Obligor is cancelled or suspended by a creditor of any Obligor as a result of an event of default (however described).
|
(d) |
Any creditor of any Obligor becomes entitled to declare any Financial Indebtedness of any Obligor due and payable prior to its specified maturity as a result of an event of default (however described).
|
(e) |
No Event of Default will occur under paragraphs (a) to (d) above if the aggregate amount of Financial Indebtedness or commitment for Financial Indebtedness in respect of the Corporate Guarantor falling under
paragraphs (a) to (d) above is $2,000,000 or less (or the equivalent in any other currency or currencies) in aggregate at any relevant time.
|
27.7 |
Insolvency
|
(a) |
A Transaction Obligor:
|
(i) |
is unable or admits inability to pay its debts as they fall due;
|
(ii) |
is deemed to, or is declared to, be unable to pay its debts under applicable law;
|
(iii) |
suspends or threatens to suspend making payments on any of its debts; or
|
(iv) |
by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors (excluding the Lender in its capacity as such) with a view to rescheduling any of its
indebtedness.
|
(b) |
The value of the assets of any Transaction Obligor is less than its liabilities (taking into account contingent and prospective liabilities).
|
(c) |
A moratorium is declared in respect of any indebtedness of any Transaction Obligor. If a moratorium occurs, the ending of the moratorium will not remedy any Event of Default caused by that moratorium.
|
(d) |
No Event of Default under paragraphs (a) to (c) above will occur if another Approved Manager is appointed by the Borrowers and such Approved Manager providing a duly executed Manager’s Undertaking to the
Lender within 30 days of the Lender giving notice to the Borrowers or (if earlier) any Transaction Obligor becoming aware of such events described above.
|
27.8 |
Insolvency proceedings
|
(a) |
Any corporate action, legal proceedings or other procedure or step is taken in relation to:
|
(i) |
the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of any Transaction
Obligor;
|
(ii) |
a composition, compromise, assignment or arrangement with any creditor of any Transaction Obligor;
|
(iii) |
the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of any Transaction Obligor or any of its assets; or
|
(iv) |
enforcement of any Security over any assets of any Transaction Obligor,
|
(b) |
Paragraph (a) above shall not apply to any winding-up petition which is frivolous or vexatious and is discharged, stayed or dismissed within 14 days of commencement.
|
27.9 |
Creditors’ process
|
27.10 |
Unlawfulness, invalidity and ranking
|
(a) |
It is or becomes unlawful for a Transaction Obligor to perform any of its obligations under the Finance Documents.
|
(b) |
Any obligation of a Transaction Obligor under the Finance Documents is not or ceases to be legal, valid, binding or enforceable.
|
(c) |
Any Finance Document ceases to be in full force and effect or to be continuing or is or purports to be determined or any Transaction Security is alleged by a party to it (other than the Lender) to be
ineffective.
|
(d) |
Any Transaction Security proves to have ranked after, or loses its priority to, any other Security.
|
27.11 |
Security imperilled
|
27.12 |
Cessation of business
|
(a) |
Any Transaction Obligor suspends or ceases to carry on (or threatens to suspend or cease to carry on) all or a material part of its business.
|
(b) |
No Event of Default under paragraph (a) above will occur if another Approved Manager is appointed by the Borrowers and such Approved Manager providing a duly executed Manager’s Undertaking to the Lender
within 30 days of the Lender giving notice to the Borrowers or (if earlier) any Transaction Obligor becoming aware of such event described above.
|
27.13 |
Expropriation
|
(a) |
an arrest or detention of a Ship referred to in paragraph (c) of Clause 7.5 (Mandatory prepayment on sale, arrest or Total Loss); or
|
(b) |
any Requisition.
|
27.14 |
Repudiation and rescission of agreements
|
27.15 |
Litigation
|
27.16 |
Material adverse change
|
27.17 |
Acceleration
|
(a) |
cancel the Commitment, whereupon it shall immediately be cancelled;
|
(b) |
declare that all or part of the Loan, together with accrued interest, and all other amounts accrued or outstanding under the Finance Documents be immediately due and payable, whereupon it shall become
immediately due and payable; and/or
|
(c) |
declare that all or part of the Loan be payable on demand, whereupon it shall immediately become payable on demand by the Lender,
|
27.18 |
Enforcement of security
|
28 |
CHANGES TO THE LENDER
|
28.1 |
Assignment by the Lender
|
28.2 |
Conditions of assignment
|
(a) |
If:
|
(i) |
the Existing Lender assigns any of its rights or obligations under the Finance Documents or changes its Facility Office; and
|
(ii) |
as a result of circumstances existing at the date the assignment or change occurs, a Transaction Obligor would be obliged to make a payment to the New Lender or the Existing Lender acting through its new
Facility Office under Clause 12 (Tax Gross Up and Indemnities) or under that Clause as incorporated by reference or in full in any other Finance Document or Clause 13 (Increased Costs),
|
(b) |
Each Obligor on behalf of itself and each Transaction Obligor agrees that all rights and interests (present, future or contingent) which the Existing Lender has under or by virtue of the Finance Documents are
assigned to the New Lender absolutely, free of any defects in the Existing Lender’s title and of any rights or equities which the Borrowers or any other Transaction Obligor had against the Existing Lender.
|
28.3 |
Security over Lender’s rights
|
(a) |
any charge, assignment or other Security to secure obligations to a federal reserve or central bank; and
|
(b) |
if the Lender is a fund, any charge, assignment or other Security granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by the Lender as security for
those obligations or securities, except that no such charge, assignment or Security shall:
|
(i) |
release the Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security for the Lender as a party to any of the Finance
Documents; or
|
(ii) |
require any payments to be made by a Transaction Obligor other than or in excess of, or grant to any person any more extensive rights than, those required to be made or granted to the Lender under the Finance
Documents.
|
29 |
CHANGES TO THE TRANSACTION OBLIGORS
|
29.1 |
Assignment or transfer by Transaction Obligors
|
29.2 |
Additional Subordinated Creditors
|
(a) |
The Borrowers may request that any person becomes a Subordinated Creditor, with the prior approval of the Lender, by delivering to the Lender:
|
(i) |
a duly executed Subordination Agreement;
|
(ii) |
a duly executed Subordinated Debt Security; and
|
(iii) |
such constitutional documents, corporate authorisations and other documents and matters as the Lender may reasonably require, in form and substance satisfactory to the Lender, to verify that the person’s
obligations are legally binding, valid and enforceable and to satisfy any applicable legal and regulatory requirements.
|
(b) |
A person referred to in paragraph (a) above will become a Subordinated Creditor on the date the Lender enters into the Subordination Agreement and the Subordinated Debt Security delivered under paragraph (a)
above.
|
30 |
PAYMENT MECHANICS
|
30.1 |
Payments to the Lender
|
(a) |
On each date on which an Obligor is required to make a payment under a Finance Document, that Obligor shall make an amount equal to such payment available to the Lender (unless a contrary indication appears
in a Finance Document) for value on the due date at the time and in such funds specified by the Lender as being customary at the time for settlement of transactions in the relevant currency in the place of payment.
|
(b) |
Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to euro, in a principal financial centre in such Participating Member State or London,
as specified by the Lender) and with such bank as the Lender, in each case, specifies.
|
30.2 |
Application of receipts; partial payments
|
(a) |
If the Lender receives a payment that is insufficient to discharge all the amounts then due and payable by an Obligor under the Finance Documents, the Lender may apply that payment towards the obligations of
that Obligor under the Finance Documents in any manner it may decide.
|
(b) |
Paragraph (a) above will override any appropriation made by an Obligor.
|
30.3 |
No set-off by Obligors
|
30.4 |
Business Days
|
(a) |
Any payment under the Finance Documents which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding
Business Day (if there is not).
|
(b) |
During any extension of the due date for payment of any principal or an Unpaid Sum under this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on the original due date.
|
30.5 |
Currency of account
|
(a) |
Subject to paragraphs (b) and (c) below, dollars is the currency of account and payment for any sum due from an Obligor under any Finance Document.
|
(b) |
Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred.
|
(c) |
Any amount expressed to be payable in a currency other than dollars shall be paid in that other currency.
|
30.6 |
Change of currency
|
(a) |
Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:
|
(i) |
any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that
country designated by the Lender (after consultation with the Borrowers); and
|
(ii) |
any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other,
rounded up or down by the Lender (acting reasonably).
|
(b) |
If a change in any currency of a country occurs, this Agreement will, to the extent the Lender (acting reasonably and after consultation with the Borrowers) specifies to be necessary, be amended to comply
with any generally accepted conventions and market practice in the Relevant Interbank Market and otherwise to reflect the change in currency.
|
30.7 |
Currency conversion
|
30.8 |
Disruption to Payment Systems etc.
|
(a) |
the Lender may, and shall if requested to do so by a Borrower, consult with the Borrowers with a view to agreeing with the Borrowers such changes to the operation or administration of the Facility as the
Lender may deem necessary in the circumstances;
|
(b) |
the Lender shall not be obliged to consult with the Borrowers in relation to any changes mentioned in paragraph (a) above if, in its opinion, it is not practicable to do so in the circumstances and, in any
event, shall have no obligation to agree to such changes;
|
(c) |
any such changes agreed upon by the Lender and the Borrowers shall (whether or not it is finally determined that a Disruption Event has occurred) be binding upon the Parties and any Obligors as an amendment
to (or, as the case may be, waiver of) the terms of the Finance Documents;
|
(d) |
the Lender shall not be liable for any damages, costs or losses to any person, any diminution in value or any liability whatsoever (including, without limitation for negligence, gross negligence or any other
category of liability whatsoever but not including any claim based on the fraud of the Lender) arising as a result of its taking, or failing to take, any actions pursuant to or in connection with this Clause 30.8 (Disruption to Payment Systems etc.).
|
31 |
SET-OFF
|
32 |
CONDUCT OF BUSINESS BY THE LENDER
|
(a) |
interfere with the right of the Lender to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
|
(b) |
oblige the Lender to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
|
(c) |
oblige the Lender to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax.
|
33 |
NOTICES
|
33.1 |
Communications in writing
|
33.2 |
Addresses
|
(a) |
in the case of the Borrowers, that specified in Schedule 1 (The Parties); and
|
(b) |
in the case of any other Obligor or the Lender, that specified in Schedule 1 (The Parties) or, if it becomes a Party after the date of this Agreement, that notified in
writing to the Lender on or before the date on which it becomes a Party;
|
33.3 |
Delivery
|
(a) |
Any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective:
|
(i) |
if by way of fax, when received in legible form; or
|
(ii) |
if by way of letter, when it has been left at the relevant address or five Business Days after being deposited in the post postage prepaid in an envelope addressed to it at that address,
|
(b) |
Any communication or document to be made or delivered to the Lender will be effective only when actually received by it and then only if it is expressly marked for the attention of the department or officer
of the Lender specified in Schedule 1 (The Parties) (or any substitute department or officer as the Lender shall specify for this purpose).
|
(c) |
Any communication or document made or delivered to the Borrowers in accordance with this Clause will be deemed to have been made or delivered to each of the Transaction Obligors.
|
(d) |
Any communication or document which becomes effective, in accordance with paragraphs (a) to (c) above, after 5.00 p.m. in the place of receipt shall be deemed only to become effective on the following day.
|
33.4 |
Electronic communication
|
(a) |
Any communication to be made or document to be delivered by one Party to another under or in connection with the Finance Documents may be made or delivered by electronic mail or other electronic means
(including, without limitation, by way of posting to a secure website) if those two Parties:
|
(i) |
notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and
|
(ii) |
notify each other of any change to their address or any other such information supplied by them by not less than five Business Days’ notice.
|
(b) |
Any such electronic communication or delivery as specified in paragraph (a) above to be made between an Obligor and the Lender may only be made in that way to the extent that those two Parties agree that,
unless and until notified to the contrary, this is to be an accepted from of communication or delivery.
|
(c) |
Any such electronic communication or document as specified in paragraph (a) above made or delivered by one Party to another will be effective only when actually received (or made available) in readable form
and in the case of any electronic communication or document made or delivered by a Party to the Lender only if it is addressed in such a manner as the Lender shall specify for this purpose.
|
(d) |
Any electronic communication or document which becomes effective, in accordance with paragraph (c) above, after 5.00 p.m. in the place in which the Party to whom the relevant communication or document is sent
or made available has its address for the purpose of this Agreement shall be deemed only to become effective on the following day.
|
(e) |
Any reference in a Finance Document to a communication being sent or received or a document being delivered shall be construed to include that communication or document being made available in accordance with
this Clause 33.4 (Electronic communication).
|
33.5 |
English language
|
(a) |
Any notice given under or in connection with any Finance Document must be in English.
|
(b) |
All other documents provided under or in connection with any Finance Document must be:
|
(i) |
in English; or
|
(ii) |
if not in English, and if so required by the Lender, accompanied by a certified English translation prepared by a translator approved by the Lender and, in this case, the English translation will prevail
unless the document is a constitutional, statutory or other official document.
|
34 |
CALCULATIONS AND CERTIFICATES
|
34.1 |
Accounts
|
34.2 |
Certificates and determinations
|
34.3 |
Day count convention
|
35 |
PARTIAL INVALIDITY
|
36 |
REMEDIES AND WAIVERS
|
(a) |
No failure to exercise, nor any delay in exercising, on the part of the Lender or any Receiver or Delegate, any right or remedy under a Finance Document shall operate as a waiver of any such right or remedy
or constitute an election to affirm any Finance Document. No election to affirm any Finance Document on the part of the Lender or any Receiver or Delegate shall be effective unless it is in writing. No single or partial exercise of any
right or remedy shall prevent any further or other exercise or the exercise of any other right or remedy. The rights and remedies provided in each Finance Document are cumulative and not exclusive of any rights or remedies provided by law.
|
(b) |
No variation or amendment of a Finance Document shall be valid unless in writing and signed by the Lender.
|
37 |
ENTIRE AGREEMENT
|
(a) |
This Agreement, in conjunction with the other Finance Documents, constitutes the entire agreement between the Parties and supersedes all previous agreements, understandings and arrangements between them,
whether in writing or oral, in respect of its subject matter.
|
(b) |
Each Obligor acknowledges that it has not entered into this Agreement or any other Finance Document in reliance on, and shall have no remedies in respect of, any representation or warranty that is not
expressly set out in this Agreement or in any other Finance Document.
|
38 |
SETTLEMENT OR DISCHARGE CONDITIONAL
|
39 |
IRREVOCABLE PAYMENT
|
40 |
CONFIDENTIAL INFORMATION
|
40.1 |
Confidentiality
|
40.2 |
Disclosure of Confidential Information
|
(a) |
to any of its Affiliates and Related Funds and any of its or their officers, directors, employees, professional advisers, auditors, insurers, insurance advisors, insurance brokers, partners and
Representatives such Confidential Information as the Lender shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (a) is informed in writing of its confidential nature and
that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the
information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information;
|
(b) |
to any person:
|
(i) |
to (or through) whom it assigns (or may potentially assign) all or any of its rights and/or obligations under one or more Finance Documents and, in each case, to any of that person’s Affiliates, Related
Funds, Representatives and professional advisers;
|
(ii) |
with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may
be made by reference to, one or more Finance Documents and/or one or more Transaction Obligors and to any of that person’s Affiliates, Related Funds, Representatives and professional advisers;
|
(iii) |
appointed by the Lender or by a person to whom sub-paragraph (i) or (ii) of paragraph (b) above applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents
on its behalf;
|
(iv) |
who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in sub-paragraph (i) or (ii) of paragraph (b) above;
|
(v) |
to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any
relevant stock exchange or pursuant to any applicable law or regulation;
|
(vi) |
to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitrations, administrative or other investigations, proceedings or disputes;
|
(vii) |
to whom or for whose benefit the Lender charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 28.3 (Security over Lender’s rights);
|
(viii) |
who is a Party, a member of the Group or any related entity of a Transaction Obligor;
|
(ix) |
as a result of the registration of any Finance Document as contemplated by any Finance Document or any legal opinion obtained in connection with any Finance Document; or
|
(x) |
with the consent of the Borrowers;
|
(A) |
in relation to sub-paragraphs (i), (ii) and (iii) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking except that there shall
be no requirement for a Confidentiality Undertaking if the recipient is a professional adviser and is subject to professional obligations to maintain the confidentiality of the Confidential Information;
|
(B) |
in relation to sub-paragraph (iv) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking or is otherwise bound by requirements of
confidentiality in relation to the Confidential Information they receive and is informed that some or all of such Confidential Information may be price-sensitive information;
|
(C) |
in relation to sub-paragraphs (v), (vi) and (vii) of paragraph (b) above, the person to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such
Confidential Information may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Lender, it is not practicable so to do in the circumstances;
|
(c) |
to any person appointed by the Lender or by a person to whom sub-paragraph (i) or (ii) of paragraph (b) above applies to provide administration or settlement services in respect of one or more of the Finance
Documents including without limitation, in relation to the trading of participations in respect of the Finance Documents, such Confidential Information as may be required to be disclosed to enable such service provider to provide any of the
services referred to in this paragraph (c) if the service provider to whom the Confidential Information is to be given has entered in to a confidentiality agreement substantially in the form of the LMA Master Confidentiality Undertaking for
Use With Administration/Settlement Service Providers or such other form of confidentiality undertaking agreed between the Borrowers and the Lender;
|
(d) |
to any rating agency (including its professional advisers) such Confidential Information as may be required to be disclosed to enable such rating agency to carry out its normal rating activities in relation
to the Finance Documents and/or the Transaction Obligors if the rating agency to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be
price-sensitive information.
|
40.3 |
Entire agreement
|
40.4 |
Inside information
|
40.5 |
Notification of disclosure
|
(a) |
of the circumstances of any disclosure of Confidential Information made pursuant to sub‑paragraph (v) of paragraph (b) of Clause 40.2 (Disclosure of Confidential Information)
except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
|
(b) |
upon becoming aware that Confidential Information has been disclosed in breach of this Clause 40 (Confidential Information).
|
40.6 |
Continuing obligations
|
(a) |
the date on which all amounts payable by the Obligors under or in connection with this Agreement have been paid in full and all Commitment have been cancelled or otherwise cease to be available; and
|
(b) |
the date on which the Lender otherwise ceases to be the Lender.
|
41 |
CONFIDENTIALITY OF FUNDING RATES
|
41.1 |
Confidentiality and disclosure
|
(a) |
Each Obligor agrees to keep each Funding Rate confidential and not to disclose it to anyone, save to the extent permitted by paragraph (b) below.
|
(b) |
Each Obligor may disclose any Funding Rate, to:
|
(i) |
any of its Affiliates and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives, if any person to whom that Funding Rate is to be given pursuant to
this sub-paragraph (i) is informed in writing of its confidential nature and that it may be price sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to
maintain the confidentiality of that Funding Rate or is otherwise bound by requirements of confidentiality in relation to it;
|
(ii) |
any person to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules
of any relevant stock exchange or pursuant to any applicable law or regulation if the person to whom that Funding Rate is to be given is informed in writing of its confidential nature and that it may be price sensitive information except
that there shall be no requirement to so inform if, in the opinion of the Lender or the relevant Obligor, as the case may be, it is not practicable to do so in the circumstances;
|
(iii) |
any person to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes if the
person to whom that Funding Rate is to be given is informed of its confidential nature and that it may be price sensitive information except that there shall be no requirement to so inform if, in the opinion of the Lender or the relevant
Obligor, as the case may be, it is not practicable to do so in the circumstances; and
|
(iv) |
any person with the consent of the Lender.
|
41.2 |
Related obligations
|
(a) |
Each Obligor acknowledges that each Funding Rate is or may be price sensitive information and that its use may be regulated or prohibited by applicable legislation including securities law relating to insider
dealing and market abuse and each Obligor undertakes not to use any Funding Rate for any unlawful purpose.
|
(b) |
The Lender and each Obligor agree (to the extent permitted by law and regulation) to inform the Lender:
|
(i) |
of the circumstances of any disclosure made pursuant to sub-paragraph (ii) of paragraph (b) of Clause 41.1 (Confidentiality and disclosure) except where such
disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
|
(ii) |
upon becoming aware that any information has been disclosed in breach of this Clause 41 (Confidentiality of Funding Rates).
|
41.3 |
No Event of Default
|
42 |
AMENDMENTS
|
42.1 |
Replacement of Screen Rate
|
42.2 |
Obligor Intent
|
43 |
COUNTERPARTS
|
44 |
GOVERNING LAW
|
45 |
ENFORCEMENT
|
45.1 |
Arbitration
|
(a) |
Any dispute arising out of and/or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement and/or any non-contractual obligation arising out of
and/or in connection with this Agreement) (a “Dispute”), shall be referred to and finally resolved by arbitration. Any such arbitration shall be conducted in accordance with English law and under the
Arbitration Rules of the Singapore International Arbitration Centre (“SIAC Rules”) current at the time when the arbitration proceedings are commenced. The SIAC
Rules are deemed to have been incorporated by reference in this Clause 45.1 above (Arbitration).
|
(b) |
The seat of the arbitration shall be Singapore. The Tribunal shall consist of one arbitrator appointed by the Lender.
|
(c) |
The language of the arbitration shall be English.
|
(d) |
The Obligors irrevocably admit to the jurisdiction of an Arbitral Tribunal constituted in accordance with this Clause 45.1 (Arbitration) and any award published by
such a Tribunal shall be final and unappealable save for appeals on the grounds of serious irregularity and, for the purposes of enforcing any award, judgement may be entered on an award by any court of competent jurisdiction.
|
(e) |
At any time before the Lender has appointed the arbitrator, the Lender may choose to submit a Dispute to any court of competent jurisdiction by giving written notice to the Obligors. If, by the time that the
Lender serves such notice, the Obligors have already sought to refer that Dispute to arbitration by serving a notice upon the Lender requiring the Lender to appoint the arbitrator in accordance with this Clause 45.1 (Arbitration) above, the Obligors shall withdraw that notice promptly upon receipt of the Lender’s notice choosing to submit that Dispute to a court of competent jurisdiction.
|
(f) |
For this purpose, the Obligors and the Lender hereby irrevocably: (i) submit to the non-exclusive jurisdiction of the High Court of Justice in England to settle any Dispute, (ii) accept that the High Court of
Justice in England is an appropriate convenient forum in which to settle any Disputes and agree not to argue to the contrary.
|
45.2 |
Service of process
|
(a) |
Without prejudice to any other mode of service allowed under any relevant law, each Obligor:
|
(i) |
irrevocably appoints Hill Dickinson Services (London) Limited at its registered office for the time being presently at The Broadgate Tower, 20 Primrose Street, London EC2A 2EW, England as its agent for service of process in relation to any proceedings before the English courts in connection with any Finance Document; and
|
(ii) |
agrees that failure by a process agent to notify the relevant Obligor of the process will not invalidate the proceedings concerned.
|
(b) |
If any person appointed as an agent for service of process is unable for any reason to act as agent for service of process, the Borrowers (on behalf of all the Obligors) must immediately (and in any event
within 5 Business days of such event taking place) appoint another agent on terms acceptable to the Lender. Failing this, the Lender may appoint another agent for this purpose.
|
Name of Borrower
|
Place of Incorporation
|
Registration number (or equivalent, if any)
|
Address for Communication
|
BAGHEERA SHIPPING CO.
|
Republic of the Marshall Islands
|
105380
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
GARFIELD SHIPPING CO.
|
Republic of the Marshall Islands
|
110506
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens
Greece
Fax No: + 357 25357796
|
Name of Corporate Guarantor
|
Place of Incorporation
|
Registration number (or equivalent, if any)
|
Address for Communication
|
CASTOR MARITIME INC.
|
Republic of the Marshall Islands
|
92609
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens
Greece
Fax No: + 357 25357796
|
Name of Original Lender
|
Commitment
|
Address for Communication
|
CHAILEASE INTERNATIONAL FINANCIAL SERVICES (SINGAPORE) PTE. LTD.
|
$23,150,000
|
18 Robinson Road #15-01
18 Robinson, Singapore 048547
Fax Number: +886-2-8752-6285
Attention: Sean Li
E-mail: SeanLi@chailease.com.tw
Telephone Number: +886-2-8752-6388 (Extension Number: 72256)
|
1 |
Obligors
|
1.1 |
A copy of the constitutional documents of each Transaction Obligor.
|
1.2 |
A copy of a resolution of the board of directors of each Transaction Obligor:
|
(a) |
approving the terms of, and the transactions contemplated by, the Finance Documents to which it is a party and resolving that it execute the Finance Documents to which it is a party;
|
(b) |
authorising a specified person or persons to execute the Finance Documents to which it is a party on its behalf; and
|
(c) |
authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices (including, if relevant, a Utilisation Request and each Selection Notice) to be signed and/or
despatched by it under, or in connection with, the Finance Documents to which it is a party.
|
1.3 |
An original of the power of attorney of any Transaction Obligor authorising a specified person or persons to execute the Finance Documents to which it is a party.
|
1.4 |
A specimen of the signature of each person authorised by the resolution referred to in paragraph 1.2 above.
|
1.5 |
A copy of a resolution signed by the holder(s) of the issued shares in each Transaction Obligor, approving the terms of, and the transactions contemplated by, the Finance Documents to which that Transaction
Obligor is a party.
|
1.6 |
A certificate of each Transaction Obligor, (signed by an officer) confirming that borrowing or guaranteeing, as appropriate, the Commitment would not cause any borrowing, guaranteeing or similar limit binding
on that corporate Transaction Obligor to be exceeded.
|
1.7 |
A certificate of each Transaction Obligor that is incorporated outside the UK (signed by an officer) certifying either that (i) it has not delivered particulars of any UK Establishment to the Registrar of
Companies as required under the Overseas Regulations or (ii) it has a UK Establishment and specifying the name and registered number under which it is registered with the Registrar of Companies.
|
1.8 |
A certificate of an authorised signatory of the relevant Transaction Obligor certifying that each copy document relating to it specified in this Part A of Schedule 2 (Conditions
Precedent) is correct, complete and in full force and effect as at a date no earlier than the date of this Agreement.
|
1.9 |
A good standing certificate of each Transaction Obligor.
|
2 |
Finance Documents
|
2.1 |
A duly executed original of any Subordination Agreement and copies of any Subordinated Finance Document.
|
2.2 |
A duly executed original of any Finance Document not otherwise referred to in this Schedule 2 (Conditions Precedent).
|
2.3 |
A duly executed original of any other document required to be delivered by each Finance Document if not otherwise referred to this Schedule 2 (Conditions Precedent).
|
3 |
Security
|
4 |
Legal opinions
|
4.1 |
A legal opinion of Watson Farley & Williams Greece, legal advisers to the Lender in England substantially in the form obtained by the Lender before signing this Agreement.
|
4.2 |
If a corporate Transaction Obligor is incorporated in a jurisdiction other than England and Wales, a legal opinion of the legal advisers to the Lender in the relevant jurisdiction, substantially in the form
obtained by the Lender before signing this Agreement.
|
5 |
Other documents and evidence
|
5.1 |
Evidence that any process agent referred to in Clause 45.2 (Service of process) has accepted its appointment.
|
5.2 |
Evidence that any process agent referred to in clause 13.3 (service of process) of the Account Security has accepted its appointment.
|
5.3 |
A copy of any other Authorisation or other document, opinion or assurance which the Lender considers to be necessary or desirable (if it has notified the Borrowers accordingly) in connection with the entry
into and performance of the transactions contemplated by any Transaction Document or for the validity and enforceability of any Transaction Document.
|
5.4 |
The Original Financial Statements.
|
5.5 |
Evidence that the fees, costs and expenses then due from the Borrowers pursuant to Clause 11 (Fees) and Clause 16 (Costs and Expenses)
have been paid or will be paid by the first Utilisation Date.
|
5.6 |
Such evidence as the Lender may require for it to be able to satisfy its “know your customer” or similar identification procedures in relation to the transactions contemplated by the Finance Documents.
|
5.7 |
Evidence satisfactory to the Lender that the Minimum Liquidity Amount has been deposited to the Minimum Liquidity Account.
|
1 |
Borrowers
|
2 |
Ship and other security
|
2.1 |
Duly executed original of the Shares Security (and of each document to be delivered under the Shares Security).
|
2.2 |
A duly executed original of the Mortgage, the General and Charter Assignment, the Account Security in respect of each Ship and of each document to be delivered under or pursuant to each of them together with
documentary evidence that each Mortgage has been duly registered as a valid first preferred ship mortgage in accordance with the laws of the jurisdiction of the Approved Flag of the relevant Ship.
|
2.3 |
Documentary evidence that each Ship:
|
(a) |
is definitively and permanently registered in the name of the relevant Borrower under the Approved Flag applicable to Ship;
|
(b) |
is in the absolute and unencumbered ownership of the relevant Borrower save as contemplated by the Finance Documents;
|
(c) |
maintains the Approved Classification with the Approved Classification Society free of all overdue recommendations and conditions of the Approved Classification Society; and
|
(d) |
is insured in accordance with the provisions of this Agreement and all requirements in this Agreement in respect of insurances have been complied with.
|
2.4 |
Documents establishing that each Ship will, as from the Utilisation Date, be managed by its Approved Manager on terms acceptable to the Lender, together with:
|
(a) |
a Manager’s Undertaking for each Approved Manager;
|
(b) |
a Co-Assured’s Undertaking by any company, corporation or other person named as co-assured under the Insurances who has not delivered a General and Charter Assignment or a Manager’s Undertaking; and
|
(c) |
copies of each Approved Manager’s Document of Compliance and of each Ship’s Safety Management Certificate (together with any other details of the applicable Safety Management System which the Lender requires)
and of any other documents required under the ISM Code and the ISPS Code in relation to that Ship including without limitation an ISSC.
|
2.5 |
An opinion from an independent insurance consultant acceptable to the Lender on such matters relating to the Insurances as the Lender may require.
|
2.6 |
A duly executed copy of each Initial Charter.
|
3 |
Legal opinions
|
4 |
Other documents and evidence
|
4.1 |
Evidence that the fees, costs and expenses then due from the Borrowers pursuant to Clause 11 (Fees) and Clause 16 (Costs and Expenses)
have been paid or will be paid by the Utilisation Date.
|
4.2 |
A copy of any other Authorisation or other document, opinion or assurance which the Lender considers to be necessary or desirable (if it has notified the Borrowers accordingly) in connection with the entry
into and performance of the transactions contemplated by any Transaction Document or for the validity and enforceability of any Transaction Document not previously supplied.
|
From:
|
BAGHEERA SHIPPING CO.
|
|
GARFIELD SHIPPING CO.
|
To:
|
CHAILEASE INTERNATIONAL FINANCIAL SERVICES (SINGAPORE) PTE. LTD.
|
|
18 Robinson Road |
|
#15-01 18 Robinson |
|
Singapore 048547 |
1 |
We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request.
|
2 |
We wish to borrow the Advance under Tranche [A][B] on the following terms:
|
|
Proposed Utilisation Date:
|
[●] (or, if that is not a Business Day, the next Business Day)
|
Amount:
|
[●] or, if less, the Available Facility
|
|
|
Interest Period for the first Advance:
|
1 Month
|
3 |
You are authorised and requested to deduct from the Advance under Tranche [A][B] prior to funds being remitted the following amounts set out against the following items:
|
|
Deductible Items
|
$
|
|
|
Minimum Liquidity Amount
|
|
|
Facility Fee
|
|
|
|
|
Net proceeds of Loan
|
|
4 |
We confirm that each condition specified in Clause 4.1 (Initial conditions precedent) and Clause 4.2 (Further conditions precedent)
of the Agreement as it relates to the Advance to which this Utilisation Request refers is satisfied on the date of this Utilisation Request.
|
5 |
The [net] proceeds of the Advance should be credited to [account].
|
6 |
This Utilisation Request is irrevocable.
|
Yours faithfully
|
|
|
|
[●]
|
|
authorised signatory for
|
|
BAGHEERA SHIPPING CO.
|
|
|
|
[●]
|
|
authorised signatory for
|
|
GARFIELD SHIPPING CO.
|
|
1 |
We refer to the Agreement. This is a Selection Notice. Terms defined in the Agreement have the same meaning in this Selection Notice unless given a different meaning in this Selection Notice.
|
2 |
We request that the next Interest Period for the Loan be [●].
|
3 |
This Selection Notice is irrevocable.
|
Yours faithfully
|
|
|
|
[●]
|
|
authorised signatory for
|
|
BAGHEERA SHIPPING CO.
|
|
|
|
[●]
|
|
authorised signatory for
|
|
GARFIELD SHIPPING CO.
|
Ship name
|
Name of the
Borrower
owner
|
Type
|
GRT
|
NRT
|
Approved
Flag
|
Approved
Classification
Society
|
Approved Classification
|
Magic Rainbow
|
Bagheera Shipping Co.
|
Bulk carrier
|
40224
|
25869
|
Marshall Islands
|
Bureau Veritas
|
✠ AUT-UMS, MON-SHAFT, ERS-S, INWATERSURVEY
|
Magic Phoenix
|
Garfield Shipping Co.
|
Bulk carrier
|
39737
|
25754
|
Marshall Islands
|
Nippon Kaiji Kyokai
|
NS*/ MNS*
(BC, SHC 2,4,6,E, 1C) (ESP)
|
Delivery of a duly completed Utilisation Request (Clause 5.1 (Delivery of the Utilisation Request)) or a Selection Notice (Clause 9.1 (Selection of Interest Periods))
|
Five Business Days before the intended Utilisation Date (Clause 5.1 (Delivery of the Utilisation Request)) or the expiry of the preceding Interest Period (Clause
9.1 (Selection of Interest Periods))
|
LIBOR is fixed
|
Quotation Day as of 11:00 am London time
|
BORROWERS
|
|
SIGNED by
|
)
|
duly authorised attorney-in-fact
|
)
|
for and on behalf of
|
)
|
BAGHEERA SHIPPING CO.
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SIGNED by
|
)
|
duly authorised attorney-in-fact
|
)
|
for and on behalf of
|
)
|
GARFIELD SHIPPING CO.
|
)
|
in the presence of:
|
)
|
|
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
CORPORATE GUARANTOR
|
|
SIGNED by
|
)
|
duly authorised attorney-in-fact
|
)
|
for and on behalf of
|
)
|
CASTOR MARITIME INC.
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
ORIGINAL LENDER
|
|
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
CHAILEASE INTERNATIONAL FINANCIAL
|
)
|
SERVICES (SINGAPORE) PTE. LTD.
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
Clause
|
Page
|
|
Section 1 Interpretation
|
2
|
|
1
|
Definitions and Interpretation
|
2
|
Section 2 The Facility
|
25
|
|
2
|
The Facility
|
25
|
3
|
Purpose
|
26
|
4
|
Conditions of Utilisation
|
26
|
Section 3 Utilisation
|
28
|
|
5
|
Utilisation
|
28
|
Section 4 Repayment, Prepayment and Cancellation
|
30
|
|
6
|
Repayment
|
30
|
7
|
Prepayment and Cancellation
|
31
|
Section 5 Costs of Utilisation
|
35
|
|
8
|
Interest
|
35
|
9
|
Interest Periods
|
36
|
10
|
Changes to the Calculation of Interest
|
37
|
11
|
Fees
|
38
|
Section 6 Additional Payment Obligations
|
39
|
|
12
|
Tax Gross Up and Indemnities
|
39
|
13
|
Increased Costs
|
43
|
14
|
Other Indemnities
|
45
|
15
|
Mitigation by the Finance Parties
|
48
|
16
|
Costs and Expenses
|
49
|
Section 7 Guarantee
|
50
|
|
17
|
Guarantee and Indemnity – Parent Guarantor
|
50
|
18
|
Joint and Several Liability of the Borrowers
|
52
|
Section 8 Representations, Undertakings and Events of Default
|
55
|
|
19
|
Representations
|
55
|
20
|
Information Undertakings
|
62
|
21
|
Financial Covenants
|
67
|
22
|
General Undertakings
|
68
|
23
|
Insurance Undertakings
|
76
|
24
|
General Ship Undertakings
|
81
|
25
|
Security Cover
|
87
|
26
|
Application of Earnings and Accounts
|
89
|
27
|
Events of Default
|
89
|
Section 9 Changes to Parties
|
94
|
|
28
|
Changes to the Lenders
|
94
|
29
|
Changes to the Obligors
|
98
|
Section 10 The Finance Parties
|
99 | |
30
|
The Facility Agent, the Arranger and the Reference Banks
|
99 |
31
|
The Security Agent
|
109
|
32
|
Conduct of Business by the Finance Parties
|
123
|
33
|
Sharing among the Finance Parties
|
123
|
Section 11 Administration
|
125
|
|
34
|
Payment Mechanics
|
125
|
35
|
Set-Off
|
128
|
36
|
Bail-in
|
128
|
37
|
Notices
|
128
|
38
|
Calculations and Certificates
|
130
|
39
|
Partial Invalidity
|
131
|
40
|
Remedies and Waivers
|
131
|
41
|
Settlement or Discharge Conditional
|
131
|
42
|
Irrevocable Payment
|
131
|
43
|
Amendments and Waivers
|
131
|
44
|
Confidential Information
|
135
|
45
|
Confidentiality of Funding Rates and Reference Bank Quotations
|
139
|
46
|
Counterparts
|
140
|
Section 12 Governing Law and Enforcement
|
141
|
|
47
|
Governing Law
|
141
|
48
|
Enforcement
|
141
|
Schedule 1 The Parties
|
142
|
Part A The Obligors
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142
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Part B The Original Lenders
|
143
|
Part C The Servicing Parties
|
144
|
Schedule 2 Conditions Precedent
|
145
|
Part A Conditions Precedent to Utilisation Request
|
145
|
Part B Conditions Precedent to Utilisation of an Advance
|
147
|
Schedule 3 Requests
|
149
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Part A Utilisation Request
|
149
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Part B Selection Notice
|
151
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Schedule 4 Form of Transfer Certificate
|
152
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Schedule 5 Form of Assignment Agreement
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154
|
Schedule 6 Form of Compliance Certificate
|
157
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Schedule 7 Timetables
|
158
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Schedule 8 Repayment Instalments
|
159
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Execution Pages
|
161 |
(1) |
MULAN SHIPPING CO., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as a borrower (“Borrower A”)
|
(2) |
JOHNNY BRAVO SHIPPING CO., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as a borrower (“Borrower B”)
|
(3) |
SONGOKU SHIPPING CO., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as a borrower (“Borrower C”)
|
(4) |
ASTERIX SHIPPING CO., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as a borrower (“Borrower D”)
|
(5) |
STEWIE SHIPPING CO., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as a borrower (“Borrower E”)
|
(6) |
CASTOR MARITIME INC., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, as guarantor (the “Parent Guarantor”)
|
(7) |
DEUTSCHE BANK AG as arranger (the “Arranger”)
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(8) |
THE FINANCIAL INSTITUTIONS listed in Part B of Schedule 1 (The Parties) as lenders (the “Original Lenders”)
|
(9) |
DEUTSCHE BANK AG as agent of the other Finance Parties (the “Facility Agent”)
|
(10) |
DEUTSCHE BANK AG as security agent for the Secured Parties (the “Security Agent”)
|
1 |
DEFINITIONS AND INTERPRETATION
|
1.1 |
Definitions
|
(a)
|
in respect of Ship A, 30 June 2025;
|
(b) |
in respect of Ship B, 8 July 2024;
|
(c) |
in respect of Ship C, 31 December 2025;
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(d) |
in respect of Ship D, 15 September 2022; and
|
(e) |
in respect of Ship E, 31 December 2026.
|
(a) |
in respect of Ship A, LRS;
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(b) |
in respect of Ship B, RINA;
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(c) |
in respect of Ship C, NK;
|
(d) |
in respect of Ship D, DNV; and
|
(e) |
in respect of Ship E, NK,
|
(a) |
(b) |
Pavimar S.A. a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960 as the technical manager,
|
(a) |
45 days from the date of this Agreement; and
|
(b) |
15 January 2022,
|
(a) |
the amount of its participation in the outstanding Loan; and
|
(b) |
in relation to any proposed Utilisation, the amount of its participation in any Advance that is due to be made on or before the proposed Utilisation Date.
|
(a) |
in relation to an EEA Member Country which has implemented, or which at any time implements, Article 55 of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms, the
relevant implementing law or regulation as described in the EU Bail-In Legislation Schedule from time to time;
|
(b) |
in relation to any state other than such an EEA Member Country and the United Kingdom, any analogous law or regulation from time to time which requires contractual recognition of any Write-down and Conversion Powers contained in that law
or regulation; and
|
(c) |
in relation to the United Kingdom, the UK Bail-In Legislation.
|
(i) |
the interest (including Margin) which a Lender should have received for the period from the date of receipt of all or any part of its participation in the Loan or an Unpaid Sum to the last day of the current Interest Period in relation to
the Loan, the relevant part of the Loan or that Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period;
|
(ii) |
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 for a period starting on the Business Day following receipt or recovery and
ending on the last day of the current Interest Period.
|
(a) |
in relation to an Original Lender, the amount set opposite its name under the heading “Commitment” in Part B of Schedule 1 (The 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,
|
(a) |
any member of the Group or any of its advisers; or
|
(b) |
another Finance Party, if the information was obtained by that Finance Party directly or indirectly from any member of the Group or any of its advisers,
|
(i) |
information that:
|
(A) |
is or becomes public information other than as a direct or indirect result of any breach by that Finance Party of Clause 44 (Confidential Information); or
|
(B) |
is identified in writing at the time of delivery as non-confidential by any member of the Group or any of its advisers; or
|
(C) |
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; and
|
(ii) |
any Funding Rate or Reference Bank Quotation.
|
(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,
|
(a) |
an account in the name of that Borrower with the Account Bank designated “Dry Dock Reserve Account”; or
|
(b) |
any other account (with that or another office of the Account Bank or with a bank or financial institution other than the Account Bank) which is designated by the Facility Agent as that Borrower’s Dry Dock Reserve Account for the purposes
of this Agreement.
|
(a) |
the following, save to the extent that any of them is, with the prior written consent of the Facility Agent, pooled or shared with any other person:
|
(i) |
all freight, hire and passage moneys;
|
(ii) |
compensation payable to a Borrower or the Security Agent in the event of requisition of that Ship for hire;
|
(iii) |
remuneration for salvage and towage services;
|
(iv) |
demurrage and detention moneys;
|
(v) |
damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of that Ship;
|
(vi) |
all moneys which are at any time payable under any Insurances in relation to loss of hire;
|
(vii) |
all monies which are at any time payable to a Borrower in relation to general average contribution; and
|
(b) |
if and whenever that Ship is employed on terms whereby any moneys falling within sub-paragraphs (i) to (vi) of paragraph (a) above are pooled or shared with any other person, that proportion of the net receipts of the relevant pooling or
sharing arrangement which is attributable to that Ship.
|
(a) |
an account in the name of that Borrower with the Account Bank designated “Earnings Account”; or
|
(b) |
any other account (with that or another office of the Account Bank or with a bank or financial institution other than the Account Bank) which is designated by the Facility Agent as the Earnings Account for the purposes of this Agreement.
|
(a) |
any release, emission, spill or discharge into a Ship or into or upon the air, sea, land or soils (including the seabed) or surface water of Environmentally Sensitive Material within or from a Ship; or
|
(b) |
any incident in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, sea, land or soils (including the seabed) or surface water from a vessel other than any Ship and which involves a
collision between any Ship and such other vessel or some other incident of navigation or operation, in either case, in connection with which a Ship is actually or potentially liable to be arrested, attached, detained or injuncted and/or a
Ship and/or any Obligor and/or any operator or manager of a Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action; or
|
(c) |
any other incident in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, sea, land or soils (including the seabed) or surface water otherwise than from a Ship and in connection with
which a Ship is actually or potentially liable to be arrested and/or where any Obligor and/or any operator or manager of a Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action.
|
(a) |
any and all shares and other equity interests (including common stock, preferred stock, limited liability company interests and partnership interests) in such person; and
|
(b) |
all rights to purchase, warrants or options or convertible debt (whether or not currently exercisable), participations or other equivalents of or interests in (however designated) such shares or other interests in such person.
|
(a) |
any valuation must be from an Approved Valuer;
|
(b) |
any valuation may be with or without physical inspection of a Ship or vessel (as the Facility Agent may require);
|
(c) |
each valuation shall be on the basis of a sale for prompt delivery for cash on normal arm’s length commercial terms as between a willing seller and a willing buyer, free of any Charter; and
|
(d) |
each valuation provided by an Approved Valuer giving a range of market values, the lowest market value will be taken as the Fair Market Value for the purpose of that valuation.
|
(a) |
sections 1471 to 1474 of the Code or any associated regulations;
|
(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.
|
(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.
|
(a) |
this Agreement;
|
(b) |
the Utilisation Request;
|
(c) |
any Security Document;
|
(d) |
any other document which is executed for the purpose of establishing any priority or subordination arrangement in relation to the Secured Liabilities; or
|
(e) |
any other document designated as such by the Facility Agent and the Borrowers.
|
(a) |
moneys borrowed;
|
(b) |
any amount raised by acceptance under any acceptance credit 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 relation to any lease or hire purchase contract which would, in accordance with GAAP, be treated as a balance sheet liability;
|
(e) |
receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);
|
(g) |
any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value (or, if any
actual amount is due as a result of the termination or close-out of that derivative transaction, that amount) shall be taken into account);
|
(h) |
any counter-indemnity obligation in relation to a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and
|
(i) |
the amount of any liability in relation to any guarantee or indemnity for any of the items referred to in paragraphs (a) to (f) above.
|
(a) |
all policies and contracts of insurance, including entries of that Ship in any protection and indemnity or war risks association, effected in relation to that Ship, that Ship’s Earnings or otherwise in relation to that Ship whether before,
on or after the date of this Agreement; and
|
(b) |
all rights and other assets relating to, or derived from, any of such policies, contracts or entries, including any rights to a return of premium and any rights in relation to any claim whether or not the relevant policy, contract of
insurance or entry has expired on or before the date of this Agreement.
|
(a) |
either:
|
(i) |
the most recent applicable Term SOFR (as of a day which is not more than three Business Days before the Quotation Day) for the longest period (for which Term SOFR is available) which is less than the Interest Period of the Loan or that
part of the Loan; or
|
(ii) |
if no such Term SOFR is available for a period which is less than the Interest Period of the Loan or that part of the Loan, SOFR for a day which is no more than three Business Days (and no less than three US Government Securities
Business Days) before the Quotation Day; and
|
(b) |
the most recent applicable Term SOFR (as of a day which is not more than three Business Days before the Quotation Day) for the shortest period (for which Term SOFR is available) which exceeds the Interest Period of the Loan or that part of
the Loan.
|
(a) |
either
|
(i) |
the applicable Term SOFR (as of the Specified Time) for the longest period (for which Term SOFR is available) which is less than the Interest Period of the Loan or that part of the Loan; or
|
(ii) |
if no such Term SOFR is available for a period which is less than the Interest Period of the Loan or that part of the Loan, SOFR for the day which is two US Government Securities Business Days) before the Quotation Day; and
|
(b) |
the applicable Term SOFR (as of the Specified Time for the shortest period (for which Term SOFR is available) which exceeds the Interest Period of the Loan or that part of the Loan.
|
(a) |
any Original Lender; and
|
(b) |
any bank, financial institution, trust, fund or other entity which has become a Party in accordance with Clause 28 (Changes to the Lenders),
|
(a) |
a blocked account in the name of that Borrower with the Account Bank designated “Liquidity Account”; or
|
(b) |
any other account (with that or another office of the Account Bank or with a bank or financial institution other than the Account Bank) which is designated by the Facility Agent as that Borrower’s Liquidity Account for the purposes of this
Agreement.
|
(a) |
if no Advance has yet been made, a Lender or Lenders whose Commitments are greater or equal to 66⅔ per cent. of the Total Commitments; or
|
(b) |
at any other time, a Lender or Lenders whose participations in the Loan are greater or equal to 66⅔ per cent. of the amount of the Loan then outstanding or, if the Loan has been repaid or prepaid in full, a Lender or Lenders whose
participations in the Loan immediately before repayment or prepayment in full are greater or equal to 66⅔ per cent. of the Loan immediately before such repayment.
|
(a) |
the business, operations, property or condition (financial or otherwise) of any member of the Borrowers or the Group or the Group as a whole; or
|
(b) |
the ability of any Obligor to perform its obligations under any Finance Document; or
|
(c) |
the validity or enforceability of, or the effectiveness or ranking of any Security granted or intended to be granted pursuant to any of, the Finance Documents or the rights or remedies of any Finance Party under any of the Finance
Documents.
|
(a) |
(subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the
immediately preceding Business Day;
|
(b) |
if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and
|
(c) |
if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.
|
(a) |
which is a time, voyage or consecutive voyage charter;
|
(b) |
the duration of which does not exceed and is not capable of exceeding, by virtue of any optional extensions, 12 months plus a redelivery allowance of not more than 60 days;
|
(c) |
which is entered into on bona fide arm’s length terms at the time at which that Ship is fixed; and
|
(d) |
in relation to which not more than two months’ hire is payable in advance,
|
(a) |
any Financial Indebtedness incurred under the Finance Documents; and
|
(b) |
any Financial Indebtedness that is subordinated to all Financial Indebtedness incurred under the Finance Documents on terms satisfactory to the Facility Agent and which is, in the case of any such Financial Indebtedness of a Borrower,
provided by the Parent Guarantor or Affiliate and is the subject of a subordination agreement on terms satisfactory to the Facility Agent.
|
(a) |
Security created by the Finance Documents;
|
(b) |
any netting or set-off arrangement entered into by any member of the Group in the ordinary course of its banking arrangements for the purpose of netting debit and credit balances;
|
(c) |
liens for unpaid master’s and crew’s wages in accordance with usual maritime practice;
|
(d) |
liens for salvage;
|
(e) |
liens for master’s disbursements incurred in the ordinary course of trading; and
|
(f) |
any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of any Ship and not as a result of any default or omission by any Borrower, provided such liens do not secure amounts
more than 30 days overdue (unless the overdue amount is being contested in good faith by appropriate steps) and subject, in the case of liens for repair or maintenance, to Clause 24.15 (Restrictions on
chartering, appointment of managers etc.).
|
(a) |
the applicable Term SOFR as of the Specified Time and for a period equal in length to the Interest Period of the Loan or that part of the Loan; or
|
(b) |
as otherwise determined pursuant to Clause 10.1 (Unavailability of Term SOFR),
|
(a) |
its jurisdiction of incorporation or organisation;
|
(b) |
any jurisdiction where any asset subject to, or intended to be subject to, any of the Transaction Security created, or intended to be created, by it is situated;
|
(c) |
any jurisdiction where it conducts its business; and
|
(d) |
the jurisdiction whose laws govern the perfection of any of the Security Documents entered into by it.
|
(a) |
any expropriation, confiscation, requisition or acquisition of a Ship, whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected by any government or
official authority or by any person or persons claiming to be or to represent a government or official authority (excluding a requisition for hire for a fixed period not exceeding one year without any right to an extension) unless it is
within 30 days redelivered to the full control of a Borrower; and
|
(b) |
any arrest, capture, seizure or detention of that Ship (including any hijacking or theft) unless it is within 30 days redelivered to the full control of a Borrower.
|
(a) |
any blocked account in the name of that Borrower with the Account Bank designated “Retention Account”; or
|
(b) |
any other account (with that or another office of the Account Bank or with a bank or financial institution other than the Account Bank) which is designated by the Facility Agent as that Borrower’s Retention Account for the purposes of this
Agreement.
|
(a) |
any Shares Security;
|
(b) |
any Mortgage;
|
(c) |
any General and Charterparty Assignment;
|
(d) |
any Account Security;
|
(e) |
any Manager’s Undertaking;
|
(f) |
any other document (whether or not it creates Security) which is executed as security for the Secured Liabilities; or
|
(g) |
any other document designated as such by the Facility Agent and the Borrowers.
|
(a) |
the Transaction Security expressed to be granted in favour of the Security Agent as trustee for the Secured Parties and all proceeds of that Transaction Security;
|
(b) |
all obligations expressed to be undertaken by an Obligor to pay amounts in relation to the Secured Liabilities to the Security Agent as trustee for the Secured Parties and secured by the Transaction Security together with all
representations and warranties expressed to be given by an Obligor or any other person in favour of the Security Agent as trustee for the Secured Parties;
|
(c) |
the Security Agent’s interest in any turnover trust created under the Finance Documents;
|
(d) |
any other amounts or property, whether rights, entitlements, choses in action or otherwise, actual or contingent, which the Security Agent is required by the terms of the Finance Documents to hold as trustee on trust for the Secured
Parties,
|
(i) |
rights intended for the sole benefit of the Security Agent; and
|
(ii) |
any moneys or other assets which the Security Agent has transferred to the Facility Agent or (being entitled to do so) has retained in accordance with the provisions of this Agreement.
|
(a) |
actual, constructive, compromised, agreed or arranged total loss of that Ship; or
|
(b) |
any Requisition of that Ship.
|
(a) |
in the case of an actual loss of that Ship, the date on which it occurred or, if that is unknown, the date when that Ship was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of that Ship, the earlier of:
|
(i) |
the date on which a notice of abandonment is given to the insurers; and
|
(ii) |
the date of any compromise, arrangement or agreement made by or on behalf of the relevant Borrower with that Ship’s insurers in which the insurers agree to treat that Ship as a total loss; and
|
(c) |
in the case of any other type of total loss, the date (or the most likely date) on which it reasonably appears to the Facility Agent that the event constituting the total loss occurred.
|
(a) |
a Finance Document;
|
(b) |
any Charter; or
|
(c) |
any other document designated as such by the Facility Agent and a Borrower.
|
(a) |
the proposed Transfer Date specified in the relevant Assignment Agreement or Transfer Certificate; and
|
(b) |
the date on which the Facility Agent executes the relevant Assignment Agreement or Transfer Certificate.
|
(a) |
a Saturday or a Sunday; and
|
(b) |
a day on which the Securities Industry and Financial Markets Association (or any successor organisation) recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in US Government
securities.
|
(a) |
a person which is resident for tax purposes in the US; or
|
(b) |
a person who is a “United States person” within the meaning of Section 7701(a)(30) of the Code.
|
(a) |
any value added tax imposed by the Value Added Tax Act 1994;
|
(b) |
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
|
(c) |
any other tax of a similar nature, whether imposed in the United Kingdom or in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) or (b) above, or imposed elsewhere.
|
(a) |
in relation to any Bail-In Legislation described in the EU Bail-In Legislation Schedule from time to time, the powers described as such in relation to that Bail-In Legislation in the EU Bail-In Legislation Schedule; and
|
(b) |
in relation to any other applicable Bail-In Legislation other than the UK Bail-In Legislation:
|
(i) |
any powers under that Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to
cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any
other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are
related to or ancillary to any of those powers;
|
(ii) |
any similar or analogous powers under that Bail-In Legislation; and
|
(c) |
in relation to the UK Bail-In Legislation, any powers under that UK Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank,
investment firm or other financial institution, to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into
shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any
of the powers under that UK Bail-In Legislation that are related to or ancillary to any of those powers.
|
1.2 |
Construction
|
(a) |
Unless a contrary indication appears, a reference in this Agreement to:
|
(i) |
the “Account Bank”, the “Arranger”, the “Facility Agent”, any “Finance Party”, any “Lender”, any “Obligor”, any “Party”, any “Secured Party”, the “Security Agent”
or any other person shall be construed so as to include its successors in title, permitted assigns and permitted transferees to, or of, its rights and/or obligations under the Finance Documents;
|
(ii) |
“assets” includes present and future properties, revenues and rights of every description;
|
(iii) |
a liability which is “contingent” means a liability which is not certain to arise and/or the amount of which remains unascertained;
|
(iv) |
“document” includes a deed and also a letter, fax or telex;
|
(v) |
“expense” means any kind of cost, charge or expense (including all legal costs, charges and expenses) and any applicable Tax including VAT;
|
(vi) |
a Lender’s “cost of funds” in relation to its participation in the Loan or any part of the Loan is a reference to the average cost (determined either on an actual or a notional basis) which that
Lender would incur if it were to fund, from whatever source(s) it may reasonably select, an amount equal to the amount of that participation in the Loan or that part of the Loan for a period equal in length to the Interest Period of the Loan
or that part of the Loan.
|
(vii) |
a “Finance Document”, a “Security Document” or “Transaction Document” or any other agreement or instrument is a
reference to that Finance Document, Security Document or Transaction Document or other agreement or instrument as amended, novated, supplemented, extended or restated;
|
(viii) |
“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;
|
(ix) |
“law” includes any order or decree, any form of delegated legislation, any treaty or international convention and any regulation or resolution of the Council of the European Union, the European
Commission, the United Nations or its Security Council;
|
(x) |
“proceedings” means, in relation to any enforcement provision of a Finance Document, proceedings of any kind, including an application for a provisional or protective measure;
|
(xi) |
a “person” includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium, partnership or other entity (whether or
not having separate legal personality);
|
(xii) |
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;
|
(xiii) |
a provision of law or regulation is a reference to that provision or regulation as amended or re-enacted;
|
(xiv) |
a time of day is a reference to London time;
|
(xv) |
any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official or any legal concept or thing shall, in respect of a jurisdiction other than England, be deemed to include that
which most nearly approximates in that jurisdiction to the English legal term;
|
(xvi) |
words denoting the singular number shall include the plural and vice versa; and
|
(xvii) |
“including” and “in particular” (and other similar expressions) shall be construed as not limiting any general words or
expressions in connection with which they are used.
|
(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) |
Section, Clause and Schedule headings are for ease of reference only and are not to be used for the purposes of construction or interpretation of the Finance Documents.
|
(d) |
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.
|
(e) |
A reference in this Agreement to a page or screen of an information service displaying a rate shall include:
|
(i) |
any replacement page of that information service which displays that rate; and
|
(ii) |
the appropriate page of such other information service which displays that rate from time to time in place of that information service,
|
(f) |
A Potential 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.
|
1.3 |
Construction of insurance terms
|
1.4 |
Agreed forms of Finance Documents
|
(a) |
in a form attached to a certificate dated the same date as this Agreement (and signed by each Borrower and the Facility Agent); or
|
(b) |
in any other form agreed in writing between each Borrower and the Facility Agent acting with the authorisation of the Majority Lenders or, where Clause 43.2 (All Lender matters) applies, all the
Lenders.
|
1.5 |
Third party rights
|
(a) |
Unless expressly provided to the contrary in a Finance Document, a person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 (the “Third Parties Act”) to enforce
or to enjoy the benefit of any term of this Agreement.
|
(b) |
Notwithstanding any term of any Finance Document, the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.
|
(c) |
Any Receiver, Delegate or any other person described in paragraph (d) of Clause 14.2 (Other indemnities), paragraph (b) of Clause 30.11 (Exclusion of liability),
Clause 30.20 (Role of Reference Banks), Clause 30.21 (Third Party Reference Banks) or paragraph (b) of Clause 31.11 (Exclusion
of liability) may, subject to this Clause 1.5 (Third party rights) and the Third Parties Act, rely on any
Clause of this Agreement which expressly confers rights on it.
|
2 |
THE FACILITY
|
2.1 |
The Facility
|
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 in respect of which a Finance Party shall be entitled to enforce its rights in accordance with paragraph (c) below. The rights of each Finance Party include any debt owing to that Finance Party under the Finance Documents and, for the
avoidance of doubt, any part of the Loan or any other amount owed by an Obligor which relates to a Finance Party’s participation in the Facility or its role under a Finance Document (including any such amount payable to the Facility Agent on
its behalf) is a debt owing to that Finance Party by that Obligor.
|
(c) |
A Finance Party may, except as otherwise stated in the Finance Documents, separately enforce its rights under the Finance Documents.
|
2.3 |
Borrowers’ Agent
|
(a) |
Each Borrower by its execution of this Agreement irrevocably appoints the Parent Guarantor to act on its behalf as its agent in relation to the Finance Documents and irrevocably authorises:
|
(i) |
the Parent Guarantor on its behalf to supply all information concerning itself contemplated by this Agreement to the Finance Parties and to give all notices and instructions (including the Utilisation Request), to make such agreements and
to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Borrower notwithstanding that they may affect any Borrower, without further reference to or the consent of that Borrower; and
|
(ii) |
each Finance Party to give any notice, demand or other communication to that Borrower pursuant to the Finance Documents to the Parent Guarantor,
|
(b) |
Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Parent Guarantor or given to the Parent Guarantor under any Finance Document on behalf of
a Borrower or in connection with any Finance Document (whether or not known to any Borrower) shall be binding for all purposes on that Borrower as if that Borrower had expressly made, given or concurred with it. In the event of any conflict
between any notices or other communications of the Parent Guarantor and any Borrower, those of the Parent Guarantor shall prevail.
|
3 |
PURPOSE
|
3.1 |
Purpose
|
3.2 |
Monitoring
|
4 |
CONDITIONS OF UTILISATION
|
4.1 |
Initial conditions precedent
|
4.2 |
Further conditions precedent
|
(a) |
on the date of the Utilisation Request and on the proposed Utilisation Date and before the Advance is made available:
|
(i) |
no Default is continuing or would result from the proposed Advance;
|
(ii) |
the Repeating Representations to be made by each Obligor are true;
|
(iii) |
no event described in paragraphs (a), 7.2(b) or (c) of Clause 7.2 (Change of control) has occurred;
|
(iv) |
no material adverse change has occurred in the credit standing or reputation of the Borrowers or the Parent Guarantor;
|
(v) |
in the case of an Advance under either Tranche, the Ship in respect of which such Advance is to be made has neither been sold nor become a Total Loss; and
|
(vi) |
the provisions of Clause 10.2 (Market Disruption) do not apply;
|
(b) |
in the case of the relevant Advance, the Facility Agent has received on or before the Utilisation Date, or is satisfied it will receive when the Advance is made available, all of the documents and other evidence listed in Part B of
Schedule 2 (Conditions Precedent) in form and substance satisfactory to the Facility Agent.
|
4.3 |
Notification of satisfaction of conditions precedent
|
(b) |
Other than to the extent that the Majority Lenders notify the Facility Agent in writing to the contrary before the Facility Agent gives the notification described in paragraph (a) above, the Lenders authorise (but do not require) the
Facility Agent to give that notification. The Facility Agent shall not be liable for any damages, costs or losses whatsoever as a result of giving any such notification.
|
4.4 |
Waiver of conditions precedent
|
4.5 |
Condition subsequent
|
5 |
UTILISATION
|
5.1 |
Delivery of the Utilisation Request
|
(a) |
The Borrowers may utilise the Facility by delivery to the Facility Agent of a duly completed Utilisation Request not later than the Specified Time.
|
(b) |
The Borrowers may not deliver more than two Utilisation Requests.
|
5.2 |
Completion of the Utilisation Request
|
(a) |
The Utilisation Request is irrevocable and will not be regarded as having been duly completed unless:
|
(i) |
the proposed Utilisation Date is a Business Day within the relevant Availability Period;
|
(ii) |
the currency and amount of the Utilisation comply with Clause 5.3 (Currency and amount); and
|
(iii) |
the proposed Interest Period complies with Clause 9 (Interest Periods).
|
(b) |
Only one Advance under each of Tranche A, Tranche B, Tranche C, Tranche D and Tranche E may be requested in the Utilisation Request.
|
5.3 |
Currency and amount
|
(a) |
The currency specified in the Utilisation Request must be dollars.
|
(b) |
(c) |
The amount of the proposed Advance must be an amount which is not more than the Available Facility.
|
(d) |
The amount of the proposed Advance must be an amount which would not oblige the Borrowers to provide additional security or prepay part of the Advance if the ratio set out in Clause 25 (Security Cover)
were applied and notice was given by the Facility Agent under Clause 25.1 (Minimum required security cover) immediately after such Advance was made.
|
5.4 |
Lenders’ participation
|
(a) |
If the conditions set out in this Agreement have been met, each Lender shall make its participation in each Advance available by the Utilisation Date through its Facility Office.
|
(b) |
The amount of each Lender’s participation in each Advance will be equal to the proportion borne by its Available Commitment to the Available Facility immediately before making that Advance.
|
(c) |
The Facility Agent shall notify each Lender of the amount of each Advance and the amount of its participation in that Advance by the Specified Time.
|
5.5 |
Cancellation of Commitments
|
5.6 |
Payment to third parties
|
5.7 |
Disbursement of Advance to third party
|
6 |
REPAYMENT
|
6.1 |
Repayment of Loan
|
(a) |
The Borrowers shall repay the Loan by 20 consecutive quarterly instalments, as follows:
|
(i) |
for the first six instalments, each in the amount of $3,535,000;
|
(ii) |
for the seventh to the 12th instalment, each in the amount of $1,750,000; and
|
(iii) |
for the 13th to the 20th instalment, each in the amount of $1,340,000,
|
(b) |
The allocation of each Repayment Instalment per Tranche is set out in Schedule 8 (Repayment Instalments).
|
(c) |
Each Repayment Instalment will reduce pro rata by the amount of the Total Commitments not utilised under this Agreement.
|
6.2 |
Effect of cancellation and prepayment on scheduled repayments
|
(b) |
If the Borrowers cancel the whole or any part of any Available Commitment in accordance with Clause 7.3 (Voluntary and automatic cancellation) or if the whole or part of any Commitment is cancelled
pursuant to Clause 5.5 (Cancellation of Commitments), the Repayment Instalments for the relevant Tranche for each Repayment Date falling after that cancellation will reduce pro rata by the amount of
the Commitments so cancelled;
|
(c) |
If any part of the Loan is repaid or prepaid in accordance with 7.6 (Right of replacement or repayment and cancellation in relation to a single Lender) or Clause 7.1 (Illegality) then the Repayment Instalments for each Repayment Date falling after that repayment or prepayment will reduce pro rata by the amount of the Loan repaid or prepaid;
|
6.3 |
Termination Date
|
6.4 |
Reborrowing
|
7 |
PREPAYMENT AND CANCELLATION
|
7.1 |
Illegality
|
(i) |
that Lender shall promptly notify the Facility Agent upon becoming aware of that event;
|
(ii) |
upon the Facility Agent notifying the Borrowers, the Available Commitment of that Lender will be immediately cancelled; and
|
(iii) |
the Borrowers shall prepay that Lender’s participation in the Loan on the last day of the Interest Period for the Loan occurring after the Facility Agent has notified the Borrowers or, if earlier, the date specified by the Lender in the
notice delivered to the Facility Agent (being no earlier than the last day of any applicable grace period permitted by law) and such Lender’s corresponding Commitment shall be cancelled in the amount of the participation prepaid.
|
(b) |
If it becomes unlawful for a Lender to perform any of its obligations as contemplated by this Agreement or to fund or maintain its participation in an Advance or the Loan due to:
|
(i) |
Sanctions and/or contrary to, or declared by any Sanctions Authority to be contrary to, Sanctions for any Affiliate of a Lender for that Lender to do so; or
|
(ii) |
without prejudice to the generality of the preceding paragraph, any Obligor, any other member of the Group being or becoming a Prohibited Person, which would result in a breach of Sanctions by a Lender:
|
(A) |
to the extent permitted by applicable law, that Lender shall promptly notify the Borrowers through the Facility Agent upon becoming aware of that event;
|
(B) |
such Lender’s Commitment will be cancelled on the date (the “Sanctions Cancellation Date”) falling 30 days after the date on which the Facility Agent has notified the Borrowers, which it shall do
promptly upon receipt of a notification from such Lender; and
|
(C) |
the Borrowers shall repay that Lender’s participation in the Loan on the last day of the Interest Period for the Loan occurring after the Sanctions Cancellation Date or, if earlier, the date specified by that Lender in the notice delivered
to the Facility Agent (being no later than the earlier of (x) the Sanctions Cancellation Date and (y) the last day of any applicable grace period permitted by law) and that Lender’s corresponding Commitment shall be cancelled in the amount of
the participation prepaid.
|
7.2 |
Change of control
|
(a) |
the Parent Guarantor ceases to control directly or indirectly the Borrowers; or
|
(i) |
serve as an executive officer or director of the Parent Guarantor; or
|
(ii) |
be a member of the board of directors of the Parent Guarantor; or
|
(iii) |
control directly or indirectly the Parent Guarantor; or
|
(c) |
the Panagiotidis Family cease to control directly or indirectly either Approved Manager,
|
(d) |
For the purposes of (a), (b) and (c) above “control” means, in respect of a Borrower, an Approved Manager, or the Parent Guarantor:
|
(i) |
the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to:
|
(A) |
cast, or control the casting of, 50.01 or more per cent. of the maximum number of votes that might be cast at a general meeting of the Parent Guarantor, that Approved Manager or (as the case may be) that Borrower; or
|
(B) |
appoint or remove all, or the majority, of the directors (excluding the directors of the Parent Guarantor) or other equivalent officers of the Parent Guarantor, that Approved Manager or (as the case may be) that Borrower; or
|
(C) |
give directions with respect to the operating and financial policies of the Parent Guarantor (excluding the directors of the Parent Guarantor), that Approved Manager or (as the case may be) that Borrower with which the directors or other
equivalent officers of the Parent Guarantor, that Approved Manager or (as the case may be) that Borrower are obliged to comply; or
|
(ii) |
the holding beneficially of more than 50.01 per cent. of the issued or common shares of the Parent Guarantor, that Approved Manager or (as the case may be) that Borrower (excluding any part of the issued shares that carry no right to
participate beyond a specified amount in a distribution of either profits or capital):
|
7.3 |
Voluntary and automatic cancellation
|
(a) |
The Borrowers may, if they give the Facility Agent not less than 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 $1,000,000) of the
Available Facility. Any cancellation under this Clause 7.3 (Voluntary and automatic cancellation) shall reduce the Commitments of the Lenders rateably.
|
(b) |
The unutilised Commitment (if any) of each Lender shall be automatically cancelled at close of business on the date on which the Advance is made available.
|
7.4 |
Voluntary prepayment of Loan
|
(a) |
Subject to paragraphs (b) and (c) below, the Borrowers may, if they give the Facility Agent not less than ten Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice; prepay the whole or any part of the Loan
(but, if in part, being an amount that reduces the amount of the Loan by a minimum amount of $1,000,000 or a multiple of that amount).
|
(b) |
The Loan may only be prepaid after the last day of the Availability Period (or, if earlier, the day on which the Available Facility is zero).
|
(c) |
The Loan may only be prepaid on an Interest Payment Date (or such other date as the Majority Lenders may agree).
|
7.5 |
Mandatory prepayment on sale or Total Loss
|
(a) |
If a Ship is sold or becomes a Total Loss, the Borrowers shall on the Relevant Date prepay the Tranche applicable to that Ship.
|
(b) |
On the Relevant Date, the Borrowers shall also prepay such part of the Loan as shall eliminate any shortfall arising if the ratio set out in Clause 25 (Security Cover) were applied immediately
following the payment referred to in paragraph (a) above excluding the relevant Ship.
|
(c) |
In this Clause 7.5 (Mandatory prepayment on sale or Total Loss):
|
(i) |
in the case of a sale of a Ship, on the earlier of:
|
(A) |
the date on which the sale is completed by delivery of that Ship to the buyer of that Ship; and
|
(B) |
the date of receipt by the relevant Borrower of the proceeds of sale relating to such sale of that Ship; and
|
(ii) |
in the case of a Total Loss of a Ship, on the earlier of:
|
(A) |
the date falling 120 days after the Total Loss Date; and
|
(B) |
the date of receipt by the Security Agent of the proceeds of insurance relating to such Total Loss.
|
7.6 |
Right of replacement or repayment and cancellation in relation to a single Lender
|
(a) |
If:
|
(ii) |
any Lender claims indemnification from a Borrower under Clause 12.3 (Tax indemnity) or Clause 13.1 (Increased costs); or
|
(iii) |
the Facility Agent receives notification from a Relevant Lender under Clause 10.2 (Market Disruption),
|
(b) |
On receipt of a notice of cancellation referred to in paragraph (a) above, the Commitment of that Lender shall immediately be reduced to zero.
|
(c) |
On the last day of each Interest Period which ends after the Borrowers have given notice of cancellation under paragraph (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.
|
7.7 |
Restrictions
|
(a) |
Any notice of cancellation or prepayment given by any Party under this Clause 7 (Prepayment and Cancellation) 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, the amount of that cancellation or prepayment and, if relevant, the part of the Loan to be prepaid or cancelled.
|
(b) |
Any prepayment or cancellation under this Agreement shall be made together with accrued interest on the amount prepaid in connection with that prepayment and, subject to the fee provided for in Clause 11.3 (Prepayment and cancellation fee) and any Break Costs, without premium or penalty.
|
(c) |
No Borrower may reborrow any part of the Facility which is prepaid.
|
(d) |
No Borrower shall repay or prepay all or any part of the Loan 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 Facility Agent receives a notice under this Clause 7 (Prepayment and Cancellation) it shall promptly forward a copy of that notice to either the Borrowers or the affected Lender, as
appropriate.
|
(g) |
If all or part of any Lender’s participation in the Loan is repaid or prepaid, an amount of that Lender’s Commitment (equal to the amount of the participation which is repaid or prepaid) will be deemed to be cancelled on the date of
repayment or prepayment.
|
7.8 |
Application of prepayments
|
8 |
INTEREST
|
8.1 |
Calculation of interest
|
(a) |
Margin;
|
(b) |
Reference Rate; and
|
(c) |
Credit Adjustment Spread.
|
8.2 |
Payment of interest
|
(a) |
The Borrowers shall pay accrued interest on the Loan or any part of the Loan on the last day of each Interest Period (each an “Interest Payment Date”).
|
(b) |
If an Interest Period is longer than three Months, the Borrowers shall also pay interest then accrued on the Loan or the relevant part of the Loan on the dates falling at three Monthly intervals after the first day of the Interest Period.
|
8.3 |
Default interest
|
(b) |
If an Unpaid Sum consists of all or part of the Loan which became due on a day which was not the last day of an Interest Period relating to the Loan or that part of the Loan:
|
(i) |
the first Interest Period for that Unpaid Sum shall have a duration equal to the unexpired portion of the current Interest Period relating to the Loan or that part of the Loan; and
|
(ii) |
the rate of interest applying to that Unpaid Sum during that first Interest Period shall be two per cent. per annum higher than the rate which would have applied if that Unpaid Sum had not become due.
|
(c) |
Default interest (if unpaid) arising on an Unpaid Sum will be compounded with the Unpaid Sum at the end of each Interest Period applicable to that Unpaid Sum but will remain immediately due and payable.
|
8.4 |
Notification of rates of interest
|
(a) |
The Facility Agent shall promptly notify the Lenders and the Borrowers of the determination of a rate of interest under this Agreement.
|
(b) |
The Facility Agent shall promptly notify the Borrowers of each Funding Rate relating to the Loan or any part of the Loan.
|
9 |
INTEREST PERIODS
|
9.1 |
Interest Periods
|
(a) |
The first Interest Period for the Loan will be three Months. Subject to paragraph (e) below and Clause 9.2 (Changes to Interest Periods), the Borrowers may select each subsequent Interest Period in
respect of the Loan in a Selection Notice.
|
(b) |
Each Selection Notice is irrevocable and must be delivered to the Facility Agent by the Borrowers not later than the Specified Time.
|
(c) |
If the Borrower fails to deliver a Selection Notice to the Facility Agent in accordance with paragraphs (a) and (b) above, the relevant Interest Period will, subject to paragraphs (f) and (g) below and Clause 9.2 (Changes to Interest Periods), be three Months.
|
(d) |
Subject to this Clause 9 (Interest Periods), the Borrowers may select an Interest Period of one or three Months or any other period agreed between the Borrowers and the Facility Agent (acting on the
instructions of all the Lenders).
|
(e) |
An Interest Period in respect of the Loan or any part of the Loan shall not extend beyond the Termination Date.
|
(f) |
In respect of a Repayment Instalment, the Borrower may request in the relevant Selection Notice that an Interest Period for a part of the Loan equal to such Repayment Instalment shall end on the Repayment Date relating to it and, subject
to paragraph (d) above, select a longer Interest Period for the remaining part of the Loan.
|
(g) |
The first Interest Period for the Loan shall start on the Utilisation Date and each subsequent Interest Period shall start on the last day of the preceding Interest Period save that in case the Facility is drawn in two Advances, the first
Interest Period for the second Advance will terminate on the same date as the first Interest Period for the first Advance.
|
(h) |
Except for the purposes of paragraph (f) and paragraph (g) above and Clause 9.2 (Changes to Interest Periods), the Loan shall have one Interest Period only at any time.
|
9.2 |
Changes to Interest Periods
|
(a) |
In respect of a Repayment Instalment, prior to determining the interest rate for the Loan, the Facility Agent may establish an Interest Period for a part of the Loan equal to such Repayment Instalment to end on the Repayment Date relating
to it and the remaining part of the Loan shall have the Interest Period selected in the relevant Selection Notice, subject to paragraph (c) of Clause 9.1 (Selection of Interest Periods).
|
(b) |
If the Facility Agent makes any change to an Interest Period referred to in this Clause 9.2 (Changes to Interest Periods), it shall promptly notify the Borrowers and the Lenders.
|
9.3 |
Non-Business Days
|
10 |
CHANGES TO THE CALCULATION OF INTEREST
|
10.1 |
Unavailability of Term SOFR
|
(c) |
Interpolated Historic Term SOFR: If paragraph (b) above applies but no Historic Term SOFR is available for the Interest Period of the Loan or any part of
the Loan, the applicable Reference Rate shall be the Interpolated Historic Term SOFR for a period equal in length to the Interest Period of the Loan or that part of the Loan.
|
(d) |
Cost of funds: If paragraph (c) above applies but it is not possible to calculate the Interpolated Historic Term SOFR, there shall be no Term SOFR Reference Rate for the Loan or that part of the
Loan (as applicable) and Clause 10.3 (Cost of funds) shall apply to the Loan or that part of the Loan for that Interest Period.
|
10.2 |
Market disruption
|
10.3 |
Cost of funds
|
(i) |
the Margin; and
|
(c) |
Subject to Clause 43.4 (Changes to reference rates), any substitute or alternative basis agreed pursuant to paragraph (b) above shall, with the prior consent of all the Lenders and the Borrowers, be
binding on all Parties.
|
(d) |
If this Clause 10.3 (Cost of funds) applies pursuant to Clause 10.2 (Market Disruption) and:
|
(i) |
a Lender’s Funding Rate is less than the Term SOFR Market Disruption Rate; or
|
(ii) |
a Lender does not notify a rate to the Facility Agent by the time specified in sub-paragraph (ii) of paragraph (a) above,
|
(e) |
If this Clause 10.3 (Cost of funds) applies, the Facility Agent shall, as soon as practicable, notify the Borrowers.
|
10.4 |
Break Costs
|
(a) |
The Borrowers shall, within three Business Days of demand by a Finance Party, pay to that Finance Party its Break Costs (if any) attributable to all or any part of the Loan or Unpaid Sum being paid by a Borrower on a day prior to the last
day of an Interest Period for the Loan, the relevant part of the Loan or that Unpaid Sum.
|
(b) |
Each Lender shall, as soon as reasonably practicable after a demand by the Facility Agent, provide a certificate confirming the amount of its Break Costs for any Interest Period in which they accrue.
|
11 |
FEES
|
11.1 |
Arrangement fee
|
11.2 |
Commitment fee
|
(a) |
The Borrowers shall pay to the Facility Agent (for the account of each Lender) a fee computed at the rate of 40 per cent. per annum of the Margin on the amount of the Total Commitments that remains undrawn and uncancelled from and
including the date of this Agreement to and including the date that is the earlier of (i) the first Utilisation Date and (ii) the date that is the last day of the Availability Period.
|
(b) |
The accrued commitment fee is payable on the date that is the earlier of (i) the first Utilisation Date and (ii) the date that is the last day of the Availability Period.
|
11.3 |
Prepayment and cancellation fee
|
(a) |
Subject to paragraph (c) below, the Borrowers must pay to the Facility Agent for each Lender a prepayment and cancellation fee on the date of prepayment of all or any part of the Loan and on the date of cancellation of any part of the
Total Commitments.
|
(b) |
The amount of the prepayment and cancellation fee is:
|
(i) |
if the prepayment or cancellation occurs on or before the second anniversary of the date of the first Utilisation Date, 1 per cent. of the amount prepaid or cancelled; and
|
(ii) |
if the prepayment or cancellation occurs after the second anniversary of the date of the first Utilisation Date, no prepayment or cancellation fee shall be payable.
|
(c) |
No prepayment or cancellation fee shall be payable under this Clause if:
|
(i) |
the prepayment or cancellation is made under Clause 7.1 (Illegality), paragraph (b) of Clause 7.5 (Mandatory prepayment on sale or Total Loss) or Clause 7.6
(Right of replacement or repayment and cancellation in relation to a single Lender); or
|
(ii) |
the Lenders assign or transfer 100 per cent of the Total Commitments to a financial institution other than a bank.
|
12 |
TAX GROSS UP AND INDEMNITIES
|
12.1 |
Definitions
|
(a) |
In this Agreement:
|
(b) |
Unless a contrary indication appears, in this Clause 12 (Tax Gross Up and Indemnities) 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 without any Tax Deduction, unless a Tax Deduction is required by law.
|
(b) |
The Borrowers shall promptly upon 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 Facility Agent accordingly. Similarly, a Lender shall notify
the Facility Agent on becoming so aware in respect of a payment payable to that Lender. If the Facility Agent receives such notification from a Lender it shall notify the Borrowers and that Obligor.
|
(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 Facility 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
|
(b) |
Paragraph (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,
|
(ii) |
to the extent a loss, liability or cost:
|
(A) |
is compensated for by an increased payment under Clause 12.2 (Tax gross-up); or
|
(B) |
relates to a FATCA Deduction required to be made by a Party.
|
(c) |
A Protected Party making, or intending to make, a claim under paragraph (a) above shall promptly notify the Facility Agent of the event which will give, or has given, rise to the claim, following which the Facility Agent shall notify the
Obligors.
|
(d) |
A Protected Party shall, on receiving a payment from an Obligor under this Clause 12.3 (Tax indemnity), notify the Facility Agent.
|
12.4 |
Tax Credit
|
(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 received; and
|
(b) |
that Finance Party has obtained and utilised that Tax Credit,
|
12.5 |
Stamp taxes
|
12.6 |
VAT
|
(a) |
All amounts expressed to be payable under a Finance Document by any Party to a Finance Party which (in whole or in part) constitute the consideration for any supply for VAT purposes are deemed to be exclusive of any VAT which is chargeable
on that supply, and accordingly, subject to paragraph (b) below, if VAT is or becomes chargeable on any supply made by any Finance Party to any Party under a Finance Document and such Finance Party is required to account to the relevant tax
authority for the VAT, that Party must pay to such 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 the VAT (and such Finance Party must promptly provide an
appropriate VAT invoice to that Party).
|
(ii) |
(where the Recipient is the person required to account to the relevant tax authority for the VAT) the Relevant 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 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 of it as represents VAT, save to the extent that such Finance Party reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.
|
(d) |
Any reference in this Clause 12.6 (VAT) 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 any member of such group at such time.
|
(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.
|
12.7 |
FATCA Information
|
(a) |
Subject to paragraph (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
|
(B) |
not a FATCA Exempt Party; and
|
(b) |
If a Party confirms to another Party pursuant to sub-paragraph (i) of paragraph (a) 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.
|
(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 sub-paragraphs (i) or (ii) of paragraph (a) above (including, for the avoidance of
doubt, where paragraph (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.
|
(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) |
where a Borrower is not a US Tax Obligor, the date of a request from the Facility Agent,
|
(i) |
a withholding certificate on Form W-8, Form W-9 or any other relevant form; or
|
(ii) |
any withholding statement or other document, authorisation or waiver as the Facility Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation.
|
(f) |
The Facility Agent shall provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) above to the Borrowers.
|
(h) |
The Facility Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) or (g) above without further verification. The Facility Agent shall
not be liable for any action taken by it under or in connection with paragraphs (e), (f) or (g) above.
|
12.8 |
FATCA Deduction
|
(a) |
Each Party may make any FATCA Deduction it is required to make by FATCA, 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 each Obligor and the Facility Agent and the Facility Agent shall notify the other Finance Parties.
|
13 |
INCREASED COSTS
|
13.1 |
Increased costs
|
(a) |
Subject to Clause 13.3 (Exceptions), the Borrowers shall, within three Business Days of a demand by the Facility Agent, pay for the account of a Finance Party the amount of any Increased Costs
incurred by that Finance Party or any of its Affiliates as a result of:
|
(i) |
Basel III or CRD IV as in force at the date of this Agreement;
|
(ii) |
any change in (or in the interpretation, administration or application of, or any replacement of,) Basel III or CRD IV as in force at the date of this Agreement, or the introduction after the date of this Agreement of any law, regulation,
request or requirement (whether or not having the force of law, but if not having the force of law, with which the relevant Finance Party, or as the case may be, its Affiliate is required to comply) in relation to Basel III or CRD IV;
|
(iii) |
the introduction of or any change in (or in the interpretation, administration or application of) any other law, regulation, request or requirement (whether or not having the force of law, but if not having the force of law, with which the
relevant Finance Party, or as the case may be, its Affiliate is required to comply) including, without limitation, those relating to capital adequacy, liquidity, reserve assets, cash ratio deposits and special deposits; or
|
(iv) |
compliance with any law or regulation made, enacted or imposed after the date of this Agreement.
|
(b) |
In this Agreement,
|
(i) |
“Basel II” shall have the meaning attributed thereto in paragraph (f) of Clause 13.3 (Exceptions).
|
(ii) |
“Basel III” means:
|
(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;
|
(B) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”;
|
(C) |
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;
|
(D) |
the rules of:
|
(1) |
the 2013/36/UE Capital Requirements Directive of the European Parliament and the Council dated June 26, 2013 concerning the access to the activity of credit institutions and the prudential supervision of credit institutions and enterprises
investment; and
|
(2) |
the (EU) 575/2013 Regulation of the European Parliament and the Council dated June 26, 2013 on prudential requirements for credit institutions and investment firms, both implementing the solvency and capitalisation rules known as “Basel
III” rules endorsed by the central bank governors and the heads of bank supervisory authorities in the G20 countries on 16 December 2010;
|
(E) |
any other law, regulation, request or requirement (whether or not having the force of law, but if not having the force of law, with which the relevant Finance Party, or as the case may be, its Affiliate is required to comply) which
implements, interprets or applies the Basel III documentation published by the Basel Committee on Banking Supervision and referred to in paragraphs (a) and (b) above (whether such implementation, interpretation, application or compliance is
by a government, regulator, Finance Party or any of its Affiliates).
|
(iii) |
“CRD IV” means:
|
(A) |
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending regulation (EU) No. 648/2012;
|
(B) |
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC
and repealing Directives 2006/48/EC and 2006/49/EC; and
|
(C) |
any other law or regulation which implements Basel III.
|
(iv) |
“Increased Costs” means:
|
(A) |
a reduction in the rate of return from the Facility or on a Finance Party’s (or its Affiliate’s) overall capital;
|
(B) |
an additional or increased cost; or
|
(C) |
a reduction of any amount due and payable 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 Facility Agent of the event giving rise to the claim, following which the Facility Agent shall
promptly notify the Borrowers.
|
(b) |
Each Finance Party shall, as soon as practicable after a demand by the Facility Agent or the Borrowers, provide a certificate confirming the amount of its Increased Costs and, provided that the Finance Party customarily provides such
evidence to other borrowers, showing the basis on which the amount is calculated.
|
13.3 |
Exceptions
|
(a) |
attributable to a Tax Deduction required by law to be made by an Obligor;
|
(b) |
attributable to a FATCA Deduction required to be made by a Party;
|
(c) |
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 paragraph (b) of Clause 12.3 (Tax indemnity) applied);
|
(d) |
compensated for by any payment made pursuant to Clause 14.3 (Mandatory Cost);
|
(e) |
attributable to the wilful or grossly negligent breach by the relevant Finance Party or its Affiliates of any law or regulation; or
|
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; or
|
(ii) |
obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,
|
(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) |
Each Obligor shall, on demand, indemnify each Secured Party against any cost, loss or liability incurred by it 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 cost, loss or liability arising as a result of Clause 33 (Sharing among the Finance
Parties);
|
(iii) |
funding, or making arrangements to fund, its participation in an Advance requested by the Borrowers in the 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 Secured Party alone); or
|
(iv) |
the Loan (or part of the Loan) not being prepaid in accordance with a notice of prepayment given by the Borrowers.
|
(c) |
Without limiting, but subject to any limitations set out in paragraph (b) above, the indemnity in paragraph (b) above shall cover any cost, loss or liability incurred by each Indemnified Person in any jurisdiction:
|
(i) |
arising or asserted under or in connection with any law relating to safety at sea, the ISM Code, any Environmental Law or any Sanctions; or
|
(ii) |
in connection with any Environmental Claim.
|
14.3 |
Mandatory Cost
|
(b) |
in the case of any Lender lending from a Facility Office in the United Kingdom, any reserve asset, special deposit or liquidity requirements (or other requirements having the same or similar purpose) of the Bank of England (or any other
governmental authority or agency) and/or paying any fees to the Financial Conduct Authority and/or the Prudential Regulation Authority (or any other governmental authority or agency which replaces all or any of their functions),
|
14.4 |
Indemnity to the Facility Agent
|
(a) |
any cost, loss or liability incurred by the Facility Agent (acting reasonably) as a result of:
|
(i) |
investigating any event which it reasonably believes is a Default; or
|
(ii) |
acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised provided the Facility Agent shall when acting or relying on such instructions act in accordance with
its standard practices applicable from time to time with respect to financial and information security and the prevention of fraud; or
|
(iii) |
instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under the Finance Documents; and
|
(b) |
any cost, loss or liability incurred by the Facility Agent (otherwise than by reason of the Facility Agent’s gross negligence or wilful misconduct) or, in the case of any cost, loss or liability pursuant to Clause 34.11 (Disruption to Payment Systems etc.) notwithstanding the Facility Agent’s negligence, gross negligence or any other category of liability whatsoever but not including any claim based on the fraud of the
Facility Agent in acting as Facility Agent under the Finance Documents.
|
14.5 |
Indemnity to the Security Agent
|
(a) |
Each Obligor shall, on demand, indemnify the Security Agent and every Receiver and Delegate against any cost, loss or liability incurred by any of them:
|
(i) |
in relation to or as a result of:
|
(A) |
any failure by a Borrower to comply with its obligations under Clause 16 (Costs and Expenses);
|
(B) |
acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised provided the Security Agent shall when acting or relying on such instructions act in accordance with
its standard practices applicable from time to time with respect to financial and information security and the prevention of fraud;
|
(C) |
the taking, holding, protection or enforcement of the Finance Documents and the Transaction Security;
|
(D) |
the exercise of any of the rights, powers, discretions, authorities and remedies vested in the Security Agent and each Receiver and Delegate by the Finance Documents or by law;
|
(E) |
any default by any Obligor in the performance of any of the obligations expressed to be assumed by it in the Finance Documents;
|
(F) |
any action by any Obligor which vitiates, reduces the value of, or is otherwise prejudicial to, the Transaction Security; and
|
(G) |
instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under the Finance Documents.
|
(ii) |
acting as Security Agent, Receiver or Delegate under the Finance Documents or which otherwise relates to any of the Security Property or the performance of the terms of this Agreement or the other Finance Documents (otherwise, in each
case, than by reason of the relevant Security Agent’s, Receiver’s or Delegate’s gross negligence or wilful misconduct).
|
(b) |
The Security Agent and every Receiver and Delegate may, in priority to any payment to the Secured Parties, indemnify itself out of the Security Assets in respect of, and pay and retain, all sums necessary to give effect to the indemnity in
this Clause 14.5 (Indemnity to the Security Agent) and shall have a lien on the Transaction Security and the proceeds of the enforcement of the Transaction Security for all monies payable to it.
|
14.6 |
Indemnity survival
|
15 |
MITIGATION BY THE FINANCE PARTIES
|
15.1 |
Mitigation
|
(b) |
Paragraph (a) above does not in any way limit the obligations of any Obligor under the Finance Documents.
|
15.2 |
Limitation of liability
|
(a) |
Each Obligor shall, on demand, indemnify each Finance Party for all costs and expenses reasonably incurred by that Finance Party as a result of steps taken by it under Clause 15.1 (Mitigation).
|
(b) |
A Finance Party is not obliged to take any steps under Clause 15.1 (Mitigation) if either:
|
(i) |
a Default has occurred and is continuing; or
|
(ii) |
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
|
(a) |
this Agreement and any other documents referred to in this Agreement;
|
(b) |
the Transaction Security; and
|
(c) |
any other Finance Documents executed after the date of this Agreement,
|
16.2 |
Amendment costs
|
(a) |
an Obligor requests an amendment, waiver or consent to this or any other Finance Document (or approval of any quiet enjoyment undertaking in relation to a Charter); or
|
(b) |
an amendment is required pursuant to Clause 34.9 (Change of currency) or as contemplated in Clause 43.4 (changes to reference rates); or
|
(c) |
an Obligor requests, and the Security Agent agrees to, the release of all or any part of the Security Assets from the Transaction Security,
|
16.3 |
Enforcement and preservation costs
|
16.4 |
Reference rate transition costs
|
(a) |
any amendment, waiver or consent relating to:
|
(i) |
the transition to the Term SOFR Reference Rate; or
|
(ii) |
any change arising as a result of an amendment required under Clause 43.4 (Changes to reference rates).
|
17 |
GUARANTEE AND INDEMNITY – PARENT GUARANTOR
|
17.1 |
Guarantee and indemnity
|
(a) |
guarantees to each Finance Party punctual performance by each Borrower of all that Borrower’s obligations under the Finance Documents;
|
(b) |
undertakes with each Finance Party that whenever a Borrower does not pay any amount when due under or in connection with any Finance Document, the Parent Guarantor shall immediately on demand pay that amount as if it were the principal
obligor; and
|
(c) |
agrees with each Finance Party that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify that Finance Party immediately on demand against any cost,
loss or liability it incurs as a result of a Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under any Finance Document on the date when it would have been due. The
amount payable by the Parent Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause 17 (Guarantee and Indemnity – Parent Guarantor) if the amount claimed
had been recoverable on the basis of a guarantee.
|
17.2 |
Continuing guarantee
|
17.3 |
Reinstatement
|
17.4 |
Waiver of defences
|
(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 member of the Group;
|
(c) |
the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect or delay in perfecting, or refusal or neglect to take up or enforce, or delay in taking or enforcing 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;
|
(f) |
any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security; or
|
(g) |
any insolvency or similar proceedings.
|
17.5 |
Immediate recourse
|
17.6 |
Appropriations
|
(a) |
refrain from applying or enforcing any other moneys, security or rights held or received by that Secured 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 the Parent Guarantor shall not be entitled to the benefit of the same; and
|
(b) |
hold any moneys received from the Parent Guarantor or on account of the Parent Guarantor’s liability under this Clause 17 (Guarantee and Indemnity – Parent Guarantor).
|
17.7 |
Deferral of Parent Guarantor’s rights
|
(a) |
to be indemnified by an Obligor;
|
(b) |
to claim any contribution from any third party providing security for, or 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 Secured Parties under the Finance Documents or of any other guarantee or security taken pursuant to, or in connection with, the
Finance Documents by any Secured 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 the Parent Guarantor has given a guarantee, undertaking or indemnity under Clause 17.1 (Guarantee and indemnity);
|
(e) |
to exercise any right of set-off against any Obligor; and/or
|
(f) |
to claim or prove as a creditor of any Obligor in competition with any Secured Party.
|
17.8 |
Additional security
|
17.9 |
Applicability of provisions of Guarantee to other Security
|
18 |
JOINT AND SEVERAL LIABILITY OF THE BORROWERS
|
18.1 |
Joint and several liability
|
18.2 |
Waiver of defences
|
(a) |
this Agreement being or later becoming void, unenforceable or illegal as regards any other Borrower;
|
(b) |
any Lender or the Security Agent entering into any rescheduling, refinancing or other arrangement of any kind with any other Borrower;
|
(c) |
any Lender or the Security Agent releasing any other Borrower or any Security created by a Finance Document; or
|
(d) |
any time, waiver or consent granted to, or composition with any other Borrower or other person;
|
(e) |
the release of any other Borrower or any other person under the terms of any composition or arrangement with any creditor of any member of the Group;
|
(f) |
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 other Borrower 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;
|
(g) |
any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of any other Borrower or any other person;
|
(h) |
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 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;
|
(i) |
any unenforceability, illegality or invalidity of any obligation or any person under any Finance Document or any other document or security; or
|
(j) |
any insolvency or similar proceedings.
|
18.3 |
Principal Debtor
|
18.4 |
Borrower restrictions
|
(a) |
Subject to paragraph (b) below, during the Security Period no Borrower shall:
|
(i) |
claim any amount which may be due to it from any other Borrower whether in respect of a payment made under, or matter arising out of, this Agreement or any Finance Document, or any matter unconnected with this Agreement or any Finance
Document; or
|
(ii) |
take or enforce any form of security from any other Borrower for such an amount, or in any way seek to have recourse in respect of such an amount against any asset of any other Borrower; or
|
(iii) |
set off such an amount against any sum due from it to any other Borrower; or
|
(iv) |
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving any other Borrower; or
|
(v) |
exercise or assert any combination of the foregoing.
|
18.5 |
Deferral of Borrowers’ rights
|
(a) |
to be indemnified by any other Borrower; or
|
(b) |
to claim any contribution from any other Borrower in relation to any payment made by it under the Finance Documents.
|
19 |
REPRESENTATIONS
|
19.1 |
General
|
19.2 |
Status
|
(a) |
It and each other Obligor is duly formed, validly existing and in good standing under the law of its jurisdiction of formation.
|
(b) |
It and each Obligor has the power to own its assets and carry on its business as it is being conducted.
|
19.3 |
Shares and ownership
|
(b) |
All of the Equity Interests of each Borrower have been validly issued, are fully paid, non-assessable, free and clear of all Security and are owned beneficially and of record by the Parent Guarantor.
|
(c) |
None of the Equity Interests of any Borrower are subject to any existing option, warrant, call, right, commitment or other agreement of any character to which the Borrowers or the Parent Guarantor is a party requiring, and there are no
Equity Interests of the Borrowers outstanding which upon conversion or exchange would require, the issuance, sale or transfer of any additional Equity Interests of the Borrowers or other Equity Interests convertible into, exchangeable for or
evidencing the right to subscribe for or purchase Equity Interests of the Borrowers.
|
19.4 |
Binding obligations
|
19.5 |
Validity, effectiveness and ranking of Security
|
(a) |
Each Finance Document to which it is a party does now or, as the case may be, will upon execution and delivery and, where applicable, registration create the Security it purports to create over any assets to which such Security, by its
terms, relates, and such Security will, when created or intended to be created, be valid and effective.
|
(b) |
No third party has or will have any Security (except for Permitted Security) over any assets that are the subject of any Transaction Security granted by it.
|
(c) |
The Transaction Security granted by it to the Security Agent or any other Secured Party has or will when created or intended to be created have first ranking priority or such priority it is expressed to have in the Finance Documents and is
not subject to any prior ranking or pari passu ranking security.
|
(d) |
No concurrence, consent or authorisation of any person is required for the creation of or otherwise in connection with any Transaction Security.
|
19.6 |
Non-conflict with other obligations
|
(a) |
any law or regulation applicable to it;
|
(b) |
its constitutional documents, if applicable; or
|
(c) |
any agreement or instrument binding upon it or any of its assets or constitute a default or termination event (however described) under any such agreement or instrument.
|
19.7 |
Power and authority
|
(a) |
It has the power to enter into, perform and deliver, and has taken all necessary action to authorise:
|
(i) |
its entry into, performance and delivery of, each Transaction Document to which it is or will be a party and the transactions contemplated by those Transaction Documents; and
|
(ii) |
in the case of each Borrower, its registration of that Ship under its Approved Flag.
|
(b) |
No limit on its powers will be exceeded as a result of the borrowing, granting of security or giving of guarantees or indemnities contemplated by the Transaction Documents to which it is a party.
|
19.8 |
Validity and admissibility in evidence
|
(a) |
to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Transaction Documents to which it is a party; and
|
(b) |
to make the Transaction Documents to which it is a party admissible in evidence in its Relevant Jurisdictions,
|
19.9 |
Governing law and enforcement
|
(a) |
The choice of governing law of each Transaction Document to which it is a party will be recognised and enforced in its Relevant Jurisdictions.
|
(b) |
Any judgment obtained in relation to a Transaction Document to which it is a party in the jurisdiction of the governing law of that Transaction Document will be recognised and enforced in its Relevant Jurisdictions.
|
19.10 |
Insolvency
|
(a) |
corporate action, legal proceeding or other procedure or step described in paragraph (a) of Clause 27.8 (Insolvency proceedings); or
|
(b) |
creditors’ process described in Clause 27.9 (Creditors’ process),
|
19.11 |
No filing or stamp taxes
|
19.12 |
Deduction of Tax
|
19.13 |
No default
|
(a) |
No Event of Default and, on the date of this Agreement and on each Utilisation Date, no Default is continuing or might reasonably be expected to result from the making of any Utilisation or the entry into, the performance of, or any
transaction contemplated by, any Transaction Document.
|
(b) |
No other event or circumstance is outstanding which constitutes a default or a termination event (however described) under any other agreement or instrument which is binding on it or to which its assets are subject.
|
(c) |
No other event or circumstance is outstanding which constitutes a default or a termination event (however described) under any other agreement or instrument which is binding on any of each Obligor’s Subsidiaries or to which any of each
Obligor’s Subsidiaries’ assets are subject which are, in aggregate in relation to each such Subsidiary, in relation to agreements with revenues of more than $3,000,000 per annum or assets worth in excess of $3,000,000.
|
19.14 |
No misleading information
|
(a) |
Any factual information provided by any member of the Group for the purposes of this Agreement was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated.
|
(b) |
The financial projections contained in any such information, if any, have been prepared on the basis of recent historical information and on the basis of reasonable assumptions.
|
(c) |
Nothing has occurred or been omitted from any such information and no information has been given or withheld that results in any such information being untrue or misleading in any material respect.
|
19.15 |
Financial Statements
|
(a) |
Its Original Financial Statements were prepared in accordance with GAAP consistently applied.
|
(b) |
Its Original Financial Statements give a true and fair view of its financial condition as at the end of the relevant financial year and results of operations during the relevant financial year (consolidated in the case of the Parent
Guarantor).
|
(c) |
There has been no material adverse change in its assets, business or financial condition (or the assets, business or consolidated financial condition of the Group, in the case of the Parent Guarantor its unaudited consolidated financial
statements) since 30 September 2021.
|
(d) |
Its most recent financial statements delivered pursuant to Clause 20.2 (Financial statements):
|
(i) |
have been prepared in accordance with Clause 20.4 (Requirements as to financial statements); and
|
(ii) |
give a true and fair view of (if audited) or fairly represent (if unaudited) its financial condition as at the end of the relevant financial year and operations during the relevant financial year (consolidated in the case of the Parent
Guarantor).
|
(e) |
Since the date of the most recent financial statements delivered pursuant to Clause 20.2 (Financial statements) there has been no material adverse change in its business, assets or financial
condition (or the business or consolidated financial condition of the Group, in the case of the Parent Guarantor).
|
19.16 |
Pari passu ranking
|
(a) |
Its payment obligations under the Finance Documents to which it is a party rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations
mandatorily preferred by law applying to companies generally.
|
(b) |
In the case of the Parent Guarantor and any guarantee given by it to any other financier in relation to financings to its other Subsidiaries, no Security has been provided by the Parent Guarantor in respect of such guarantee which is not
equivalent to the Security being granted by the Parent Guarantor to the Finance Parties pursuant to this Agreement.
|
19.17 |
No proceedings pending or threatened
|
(a) |
No litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code) of or before any court, arbitral body or
agency have (to the best of its knowledge and belief) been started or threatened against it which is likely to exceed, when aggregated, $500,000.
|
(b) |
No judgment or order of a court, arbitral tribunal or other tribunal or any order or sanction of any governmental or other regulatory body has (to the best of its knowledge and belief (having made due and careful enquiry)) been made
against it, or any of its directors, officers or employees or anyone acting on its behalf or any other Obligor.
|
(c) |
No litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any actual breach of the ISM Code or of the ISPS Code), in relation to amounts in aggregate (in relation to
each individual member of the Group) of more than $4,000,000 in aggregate, of or before any court, arbitral body or agency have (to the best of its knowledge and belief (having made due and careful enquiry)) been started or threatened against
any such member of the Group.
|
19.18 |
Valuations
|
(b) |
It has not omitted to supply any information to an Approved Valuer which, if disclosed, would adversely affect any valuation prepared by such Approved Valuer.
|
(c) |
There has been no change to the factual information provided pursuant to paragraph (a) above in relation to any valuation between the date such information was provided and the date of that valuation which, in either case, renders that
information untrue or misleading in any material respect.
|
19.19 |
No breach of laws
|
19.20 |
Charters
|
19.21 |
Compliance with Environmental Laws
|
19.22 |
No Environmental Claim
|
(a) |
No Environmental Claim has been made or threatened against any Obligor or member of the Group or any Ship which might reasonably be expected to have a Material Adverse Effect.
|
(b) |
No Environmental Claim has been made or threatened against any member of the Group which is not an Obligor other than an Environmental Claim which is vexatious or frivolous and has not been withdrawn or dismissed within 20 days of the date
it arises.
|
19.23 |
No Environmental Incident
|
19.24 |
ISM and ISPS Code compliance
|
19.25 |
Taxes paid
|
(a) |
It is not and no other member of the Group is materially overdue in the filing of any Tax returns and it is not (and no other member of the Group is) overdue in the payment of any amount in respect of Tax.
|
(b) |
No claims or investigations are being, or are reasonably likely to be, made or conducted against it (or any other member of the Group) with respect to Taxes.
|
19.26 |
Financial Indebtedness
|
19.27 |
Overseas companies
|
19.28 |
Good title to assets
|
19.29 |
Ownership
|
(a) |
Each Borrower is the sole legal and beneficial owner of the Ship owned by it, its Earnings and its Insurances.
|
(b) |
With effect on and from the date of its creation or intended creation, each Obligor will be the sole legal and beneficial owner of any asset that is the subject of any Transaction Security created or intended to be created by such Obligor.
|
(c) |
The constitutional documents of each Obligor do not and could not restrict or inhibit any transfer of the shares of the Borrowers on creation or enforcement of the security conferred by the Security Documents.
|
19.30 |
Centre of main interests and establishments
|
19.31 |
Place of business
|
19.32 |
No employee or pension arrangements
|
19.33 |
Sanctions
|
(a) |
(i) |
is a Prohibited Person or is owned 50% or more by or otherwise controlled by one or more of these Persons;
|
(ii) |
has violated or is violating any Sanctions;
|
(iii) |
has received notice of or is aware of any claim, action, suit, proceeding or investigation against it with respect to Sanctions by any Sanctions Authority; or
|
(iv) |
is knowingly engaged in any activity that would reasonably be expected to result in such person being designated as a Prohibited Person.
|
(v) |
Each of the Obligors has implemented and maintains in effect a Sanctions compliance policy which, is designed (giving regards to the recommendations of the Sanctions Advisory) to ensure compliance by each such Obligor, its Subsidiaries and
their respective managers, directors, officers, employees and agents with Sanctions.
|
19.34 |
US Tax Obligor
|
19.35 |
Anti-Money Laundering Laws
|
19.36 |
No Money laundering
|
(a) |
Each Obligor is acting for its own account in relation to the Loan and in relation to the performance and the discharge of its respective obligations and liabilities under the Finance Documents and the transactions and other arrangements
effected or contemplated by the Finance Documents to which such Obligor is a party, and the foregoing will not involve or lead to contravention of any law, official requirement or other regulatory measure or procedure implemented to combat
money laundering (as defined in Article I of the Directive (2001/97EC of the European Parliament and of 4 December 2001)).
|
(b) |
Each Borrower is acting as principal for its own account and not as agent or trustee in any capacity on behalf of any party in relation to the Finance Documents.
|
(c) |
With regard to § 3 Abs. 1 S. 1 Nr. 2, Abs. 4 GwG, the Parent Guarantor confirms to provide the security for the benefit of the Borrowers.
|
19.37 |
Anti-corruption law
|
(a) |
Each Obligor has not or will not use the proceeds of the Loan for any purpose which would breach the UK Bribery Act 2010, the United States Foreign Corrupt Practices Act of 1977 or other similar legislation in other jurisdictions (“Anti-Bribery and Corruption Laws”).
|
(b) |
Each Obligor and, to the best of the Obligors’ knowledge, any manager, director, officer, employee, or anyone acting on behalf of the Obligors:
|
(i) |
conducts its business in compliance with applicable anti-corruption laws; and each Obligor
|
(ii) |
maintains policies and procedures designed to promote and achieve compliance with such laws.
|
19.38 |
Immunity
|
19.39 |
Ongoing Proceeding
|
19.40 |
Repetition
|
20 |
INFORMATION UNDERTAKINGS
|
20.1 |
General
|
20.2 |
Financial statements
|
(a) |
(b) |
as soon as they become available, but in any event within 120 days after the end of its respective financial year the (audited, if available) financial statements of each Borrower for that financial year;
|
(c) |
(d) |
promptly upon request from the Facility Agent any other information including, but not limited to, individual vessel and group cash flow forecasts and employment summaries which may be reasonably required by the Lenders from time to time.
|
20.3 |
Compliance Certificate
|
(a) |
The Parent Guarantor shall supply to the Facility Agent, with each set of financial statements delivered pursuant to paragraphs (a) and (c) of Clause 20.2 (Financial statements), a Compliance
Certificate (together with any supporting evidence as may be reasonably requested by the Facility Agent) as to compliance with Clause 21 (Financial Covenants) as at the date as at which those financial
statements were drawn up.
|
(b) |
Each Compliance Certificate shall be signed by one authorised signatory of the Parent Guarantor.
|
20.4 |
Requirements as to financial statements
|
(a) |
Each set of financial statements delivered by a Borrower or the Parent Guarantor (as the case may be) pursuant to Clause 20.2 (Financial statements) shall be certified by a senior officer (or
equivalent) of the relevant company as giving a true and fair view (if audited) or fairly representing (if unaudited) its financial condition and operations as at the date as at which those financial statements were drawn up.
|
(b) |
The Borrowers shall procure that each set of financial statements delivered pursuant to Clause 20.2 (Financial statements) is prepared using GAAP.
|
(c) |
The Borrowers shall procure that each set of financial statements of an Obligor delivered pursuant to Clause 20.2 (Financial statements) is prepared using GAAP, accounting practices and financial
reference periods consistent with those applied in the preparation of the Original Financial Statements for that Obligor unless, in relation to any set of financial statements, it notifies the Facility Agent that there has been a change in
GAAP, the accounting practices or reference periods and its auditors (or, if appropriate, the auditors of the Obligor) deliver to the Facility Agent:
|
(i) |
a description of any change necessary for those financial statements to reflect the GAAP, accounting practices and reference periods upon which that Obligor’s Original Financial Statements were prepared; and
|
(ii) |
sufficient information, in form and substance as may be reasonably required by the Facility Agent, to enable the Lenders to determine whether Clause 21 (Financial Covenants) has been complied with
and make an accurate comparison between the financial position indicated in those financial statements and that Obligor’s Original Financial Statements.
|
20.5 |
DAC6
|
(a) |
In this Clause 20.5 (DAC6), “DAC6” means the Council Directive of 25 May 2018 (2018/822/EU) amending Directive 2011/16/EU or
any replacement legislation for DAC 6 applicable in the UK.
|
(b) |
The Borrowers shall supply to the Facility Agent (in sufficient copies for all the Lenders, if the Facility Agent so requests):
|
(i) |
promptly upon the making of such analysis or the obtaining of such advice, any analysis made or advice obtained on whether any transaction contemplated by the Transaction Documents or any transaction carried out (or to be carried out) in
connection with any transaction contemplated by the Transaction Documents contains a hallmark as set out in Annex IV of DAC6; and
|
(ii) |
promptly upon the making of such reporting and to the extent permitted by applicable law and regulation, any reporting made to any governmental or taxation authority by or on behalf of any member of the Group or by any adviser to such
member of the Group in relation to DAC6 or any law or regulation which implements DAC6 and any unique identification number issued by any governmental or taxation authority to which any such report has been made (if available).
|
20.6 |
Information: miscellaneous
|
(a) |
all documents dispatched by it to its shareholders (or any class of them) or its creditors generally at the same time as they are dispatched;
|
(b) |
promptly upon becoming aware of them, the details of any litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the
ISPS Code) which are current, threatened or pending against any Obligor which is likely to exceed, when aggregated, $500,000;
|
(c) |
promptly upon becoming aware of them, the details of any litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any actual breach of the ISM Code or of the ISPS Code)
which is made against any member of the Group which is likely to exceed, when aggregated, $500,000;
|
(d) |
promptly, its constitutional documents where these have been amended or varied;
|
(e) |
promptly, such further information and/or documents regarding:
|
(i) |
each Ship, goods transported on each Ship, its Earnings and its Insurances;
|
(ii) |
the Security Assets;
|
(iii) |
the Approved Managers (including any management agreements);
|
(iv) |
compliance of the Obligors with the terms of the Finance Documents;
|
(v) |
the financial condition, business and operations of any member of the Group,
|
(f) |
promptly, such further information and/or documents as any Finance Party (through the Facility Agent) may reasonably request so as to enable such Finance Party to comply with any laws applicable to it or as may be required by any
regulatory authority; and
|
(g) |
promptly, the details of any change in the directors of an Obligor including contact details for any new directors of that Obligor.
|
20.7 |
Notification of Default
|
(a) |
Each Obligor shall notify the Facility Agent of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence.
|
(b) |
Promptly upon a request by the Facility Agent, each Borrower shall supply to the Facility Agent a certificate signed by its manager on its behalf certifying that no Default is continuing (or if a Default is continuing, specifying the
Default and the steps, if any, being taken to remedy it).
|
20.8 |
Restructuring
|
20.9 |
Use of websites
|
(a) |
Each Obligor may satisfy its obligation under the Finance Documents to which it is a party to deliver any information in relation to those Lenders (the “Website Lenders”) which accept this method of
communication by posting this information onto an electronic website designated by the Borrowers and the Facility Agent (the “Designated Website”) if:
|
(i) |
the Facility Agent expressly agrees (after consultation with each of the Lenders) that it will accept communication of the information by this method;
|
(ii) |
both the relevant Obligor and the Facility Agent are aware of the address of and any relevant password specifications for the Designated Website; and
|
(iii) |
the information is in a format previously agreed between the relevant Obligor and the Facility Agent.
|
(b) |
The Facility Agent shall supply each Website Lender with the address of and any relevant password specifications for the Designated Website following designation of that website by the Obligors or any of them and the Facility Agent.
|
(c) |
An Obligor shall promptly upon becoming aware of its occurrence notify the Facility Agent if:
|
(i) |
the Designated Website cannot be accessed due to technical failure;
|
(ii) |
the password specifications for the Designated Website change;
|
(iii) |
any new information which is required to be provided under this Agreement is posted onto the Designated Website;
|
(iv) |
any existing information which has been provided under this Agreement and posted onto the Designated Website is amended; or
|
(v) |
if that Obligor becomes aware that the Designated Website or any information posted onto the Designated Website is or has been infected by any electronic virus or similar software.
|
(d) |
Any Website Lender may request, through the Facility Agent, one paper copy of any information required to be provided under this Agreement which is posted onto the Designated Website. The Obligors shall comply with any such request within
10 Business Days.
|
20.10 |
“Know your customer” checks
|
(a) |
If:
|
(i) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
|
(ii) |
any change in the status of an Obligor or Approved Manager (including, without limitation, a change of ownership of an Obligor or Approved Manager) after the date of this Agreement;
|
(iii) |
a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer; or
|
(iv) |
otherwise any “know your customer” checks or similar identification procedures, or internal policies of a Lender, or any procedure required under any applicable anti-money laundering and anti-terrorism acts applicable to a Finance Party,
|
(b) |
Each Lender shall promptly upon the request of a Servicing Party supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Servicing Party (for itself) in order for that Servicing Party to
carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.
|
20.11 |
Other financings of the Group and Parent guarantees
|
(a) |
The Parent Guarantor undertakes to provide to the Facility Agent such information as the Facility Agent may reasonably request in relation to any vessel financings made available to other members of the Group and their performance
thereunder.
|
(b) |
If, at any time, the Parent provides a guarantee to any financier in relation to any vessel financings made available to its indirect or direct Subsidiaries, the Parent Guarantor will notify the Facility Agent and, if required by the
Facility Agent, will provide a similar guarantee from the Parent in relation to the financing under this Agreement.
|
21 |
FINANCIAL COVENANTS
|
21.1 |
Financial definitions
|
(a) |
all Financial Indebtedness;
|
(b) |
minus cash balance and any amounts credited into the Dry Dock Reserve Accounts.
|
(a) |
plus, to the extent deducted in computing the net income of the Parent Guarantor for that accounting period, the sum, without duplication, of:
|
(i) |
all federal, state, local and foreign income taxes and tax distributions;
|
(ii) |
Parent Guarantor Net Interest Expense;
|
(iii) |
depreciation, depletion, amortization of intangibles and other non-cash charges or non-cash losses (including non-cash transaction expenses and the amortization of debt discounts) and any extraordinary losses not incurred in the ordinary
course of business;
|
(iv) |
expenses in connection with a special or intermediate survey of a Ship; and
|
(v) |
any drydocking expenses;
|
(b) |
minus, to the extent added in computing the net income of any of the Parent Guarantor for that accounting period, (i) any non-cash income or non-cash gains and (ii) any extraordinary gains or losses on asset sales not incurred in
the ordinary course of business;
|
21.2 |
Test
|
(a) |
On each Testing Date for the Parent Guarantor on a consolidated basis:
|
(i) |
the Value Adjusted Net Leverage Ratio shall be not more than 0.65 to 1; and
|
(ii) |
the Interest Cover Ratio shall be not be less than 3 to 1.
|
(b) |
During the Security Period, the Parent Guarantor shall maintain at the end of each financial quarter, the higher amount of (i) $20,000,000 in unencumbered cash including any amounts credited into the Dry Dock Reserve Accounts that is
freely available or (ii) 10 per cent. of the consolidated debt balance sheet of the Parent Guarantor and its Subsidiaries, plus the aggregate Pledged Liquidity, in each case evidenced either as a credit balance in the Parent Guarantor’s bank
statement or as a cash item on the consolidated balance sheet of the Parent Guarantor and its Subsidiaries.
|
(c) |
For the avoidance of doubt, the $20,000,000 under Clause 21.2(b) (Test) does not include the Pledged Liquidity.
|
21.3 |
Equal treatment with other facilities to the Parent Guarantor
|
22 |
GENERAL UNDERTAKINGS
|
22.1 |
General
|
22.2 |
Authorisations
|
(a) |
obtain, comply with and do all that is necessary to maintain in full force and effect; and
|
(b) |
supply certified copies to the Facility Agent of,
|
(i) |
perform its obligations under the Transaction Documents to which it is a party;
|
(ii) |
ensure the legality, validity, enforceability or admissibility in evidence in any Relevant Jurisdiction or in the state of the Approved Flag at any time of each Ship, of any Transaction Document to which it is a party; and
|
(iii) |
own and operate each Ship (in the case of the Borrowers).
|
22.3 |
Compliance with laws
|
22.4 |
Environmental compliance
|
(a) |
comply with all Environmental Laws;
|
(b) |
obtain, maintain and ensure compliance with all requisite Environmental Approvals;
|
(c) |
implement procedures to monitor compliance with and to prevent liability under any Environmental Law.
|
22.5 |
Environmental claims
|
(a) |
any Environmental Claim against any Obligor which is current, pending or threatened and is expected to exceed $750,000;
|
(b) |
any Environmental Claim against any member of the Group, which is not an Obligor, which is current or pending and is expected to exceed $750,000 and has not been withdrawn or dismissed within 20 days of the date it arises; and
|
(c) |
any facts or circumstances which are reasonably likely to result in any Environmental Claim being commenced or threatened against any Obligor where such claim is expected to exceed $750,000 or any member of the Group and which
Environmental Claim is reasonably likely to result in a Material Adverse Effect.
|
22.6 |
Taxation
|
(a) |
Each Obligor shall, and the Parent Guarantor shall ensure that each other member of the Group will pay and discharge all Taxes imposed upon it or its assets within the time period allowed without incurring penalties unless and only to the
extent that:
|
(i) |
such payment is being contested in good faith;
|
(ii) |
adequate reserves are maintained for those Taxes and the costs required to contest them have been disclosed in its latest financial statements delivered to the Facility Agent under Clause 20.2 (Financial
statements); and
|
(iii) |
such payment can be lawfully withheld.
|
(b) |
No Obligor shall change its residence for Tax purposes.
|
22.7 |
Overseas companies
|
22.8 |
No change to centre of main interests
|
22.9 |
Pari passu ranking
|
22.10 |
Title
|
(a) |
Each Borrower shall hold the legal title to, and own the entire beneficial interest in the Ship owned by it, its Earnings and its Insurances.
|
(b) |
With effect on and from its creation or intended creation, each Obligor shall hold the legal title to, and own the entire beneficial interest in any other assets the subject of any Transaction Security created or intended to be created by
such Obligor.
|
22.11 |
Negative pledge
|
(b) |
No Borrower shall:
|
(i) |
sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by an Obligor;
|
(ii) |
sell, transfer or otherwise dispose of any of its receivables on recourse terms;
|
(iii) |
enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or
|
(iv) |
enter into any other preferential arrangement having a similar effect,
|
(c) |
Paragraphs (a) and (b) above do not apply to any Permitted Security and paragraph (b) above does not apply to the sale of a Ship where the proceeds are applied in accordance with Clause 7.5 (Mandatory
prepayment on sale or Total Loss).
|
22.12 |
Disposals
|
(b) |
Paragraph (a) above does not apply to any Charter to which Clause 24.15 (Restrictions on chartering, appointment of managers etc.) applies.
|
(c) |
Paragraph (a) above does not apply to any sale of any Ship provided that (i) no Event of Default has occurred and is continuing and (ii) the provisions of Clause 7.5 (Mandatory prepayment on sale or Total
Loss) and 11.3 (Prepayment and cancellation fee) are complied with.
|
22.13 |
Merger
|
(a) |
No Obligor shall enter into any amalgamation, demerger, merger, consolidation or corporate reconstruction.
|
(b) |
Paragraph (a) of this Clause 22.13 (Merger) shall not be applicable to any Obligor (other than the Borrowers) if in the case of such amalgamation, demerger, merger, consolidation, or corporate reconstruction between that Obligor and
another entity, that Obligor remains the surviving entity of that amalgamation, demerger, merger, consolidation, or corporate reconstruction and as long as, no Event of Default has occurred and is continuing
|
22.14 |
Change of business
|
(a) |
The Parent Guarantor shall procure that no substantial change is made to the general nature of the business of the Parent Guarantor or the Group from that carried on at the date of this Agreement.
|
(b) |
The Parent Guarantor may engage in the ownership and operation of crude, product or chemical tankers, containerships or bulk carriers but may not engage in the direct ownership of other types of vessels unless the Facility Agent (acting on
the instructions of the Majority Lenders) has provided its prior written consent, not to be unreasonably withheld or conditioned.
|
(c) |
No Borrower shall engage in any business other than the ownership and operation of its Ship.
|
22.15 |
Financial Indebtedness
|
22.16 |
Expenditure
|
22.17 |
Capital
|
(a) |
permit a reduction or increase of its capital by way of the issuance of any class or series of Equity Interests or create any new class of Equity Interests except to the Parent Guarantor and provided such new Equity Interests are made
subject to the terms of the Shares Security applicable to that Borrower immediately upon the issue such new class or series of Equity Interests in a manner satisfactory to the Facility Agent and the terms of that Shares Security are complied
with;
|
(b) |
appoint any further manager, director or officer of that Borrower (unless the provisions of the Shares Security applicable to that Borrower are complied with).
|
22.18 |
Dividends
|
22.19 |
Accounts
|
22.20 |
Other transactions
|
(a) |
be the creditor in respect of any loan or any form of credit to any person other than any member of the Group provided that the making of such loan or credit is not reasonably likely to result in the occurrence of an Event of Default;
|
(b) |
give or allow to be outstanding any guarantee or indemnity to or for the benefit of any person in respect of any obligation of any other person or enter into any document under which that Borrower assumes any liability of any other person
other than any guarantee or indemnity given under the Finance Documents;
|
(c) |
enter into any material agreement other than:
|
(i) |
the Transaction Documents;
|
(ii) |
any other agreement permitted under any other term of this Agreement; and
|
(d) |
enter into any transaction on terms which are, in any respect, less favourable to that Borrower than those which it could obtain in a bargain made at arms’ length; or
|
(e) |
acquire any shares or other securities other than US or UK Treasury bills and certificates of deposit issued by major North American or European banks.
|
22.21 |
Unlawfulness, invalidity and ranking; Security imperilled
|
(a) |
make it unlawful for an Obligor to perform any of its obligations under the Transaction Documents;
|
(b) |
cause any obligation of an Obligor under the Transaction Documents to cease to be legal, valid, binding or enforceable;
|
(c) |
cause any Transaction Document to cease to be in full force and effect;
|
(d) |
cause any Transaction Security to rank after, or lose its priority to, any other Security; and
|
(e) |
imperil or jeopardise the Transaction Security.
|
22.22 |
Further assurance
|
(a) |
Each Obligor shall promptly, and in any event within the reasonable time period specified by the Security Agent do all such acts (including procuring or arranging any registration, notarisation or authentication or the giving of any
notice) or execute or procure execution of all such documents (including assignments, transfers, mortgages, charges, notices, instructions, acknowledgments, proxies and powers of attorney), as the Security Agent may specify (and in such form
as the Security Agent may require in favour of the Security Agent or its nominee(s)):
|
(i) |
to create, perfect, vest in favour of the Security Agent or protect the priority of the Security or any right of any kind created or intended to be created under or evidenced by the Finance Documents (which may include the execution of a
mortgage, charge, assignment or other Security over all or any of the assets which are, or are intended to be, the subject of the Transaction Security) or for the exercise of any rights, powers and remedies of the Security Agent, any Receiver
or the Secured Parties provided by or pursuant to the Finance Documents or by law;
|
(ii) |
to confer on the Security Agent or confer on the Secured Parties Security over any property and assets of that Obligor located in any jurisdiction equivalent or similar to the Security intended to be conferred by or pursuant to the Finance
Documents;
|
(iii) |
to facilitate or expedite the realisation and/or sale of, the transfer of title to or the grant of, any interest in or right relating to the assets which are, or are intended to be, the subject of the Transaction Security or to exercise
any power specified in any Finance Document in respect of which the Security has become enforceable; and/or
|
(iv) |
to enable or assist the Security Agent to enter into any transaction to commence, defend or conduct any proceedings and/or to take any other action relating to any item of the Security Property.
|
(b) |
Each Obligor shall take all such action as is available to it (including making all filings and registrations) as may be necessary for the purpose of the creation, perfection, protection or maintenance of any Security conferred or intended
to be conferred on the Security Agent or the Secured Parties by or pursuant to the Finance Documents.
|
(c) |
At the same time as an Obligor delivers to the Security Agent any document executed by itself pursuant to this Clause 22.22 (Further assurance), that Obligor shall deliver to the Security Agent
reasonable evidence that that Obligor’s execution of such document has been duly authorised by it.
|
22.23 |
Liquidity Account
|
22.24 |
No Money laundering
|
(a) |
Each Obligor shall act for its own account in relation to the Loan and in relation to the performance and the discharge of its respective obligations and liabilities under the Finance Documents and the transactions and other arrangements
effected or contemplated by the Finance Documents to which such Obligor is a party, and shall ensure that the foregoing will not involve or lead to contravention of any law, official requirement or other regulatory measure or procedure
implemented to combat money laundering (as defined in Article I of the Directive (2001/97EC of the European Parliament and of 4 December 2001)).
|
(b) |
Each Borrower shall act as principal for its own account and not as agent or trustee in any capacity on behalf of any party in relation to the Finance Documents.
|
(c) |
With regard to § 3 Abs. 1 S. 1 Nr. 2, Abs. 4 GwG, the Parent Guarantor shall provide the security for the benefit of the Borrowers.
|
22.25 |
Anti-corruption law
|
(a) |
Each Obligor shall not directly or indirectly use the proceeds of the Loan for any purpose which would breach the Anti-Bribery and Corruption Laws.
|
(b) |
Each Borrower shall:
|
(i) |
conduct its businesses in compliance with applicable anti-corruption laws; and
|
(ii) |
maintain policies and procedures designed to promote and achieve compliance with such laws.
|
22.26 |
Sanctions
|
(a) |
No Obligor shall, and shall not suffer, permit or authorize any other Obligor or any other member of the Group to, directly or indirectly, use, lend, make payments of, contribute or otherwise make available, all or any part of the proceeds
of the Loan or other transaction(s) contemplated by this Agreement to fund any trade, business or other activities:
|
(i) |
involving or for the benefit of any Prohibited Person or any subsidiary or joint venture partner of any Prohibited Person (whether at the time of such funding or otherwise);
|
(ii) |
(iii) |
in any other manner that would result in a violation of Sanctions by any Obligor, any other member of the Group or any Finance Party.
|
(b) |
Each Obligor will, and will ensure that any other Obligor and any other member of the Group will:
|
(i) |
ensure that no person that is a Prohibited Person will have any legal or beneficial interest in any funds repaid or remitted by any Obligor to a Lender in connection with the Loan or any part of the Loan;
|
(ii) |
not fund all or any part of any payment or repayment under the Loan out of proceeds derived from any activity with a Prohibited Person or in or with a Sanctioned Country;
|
(iii) |
not fund all or any part of any payment or repayment under the Loan out of proceeds derived from transactions which would be prohibited by Sanctions or would otherwise cause any Finance Party, any Obligor or any other member of the Group
to be in breach of Sanctions; and
|
(iv) |
procure that no proceeds from activities or business with a Prohibited Person or in or with a Sanctioned Country are credited to any Earnings Account or any other Account.
|
(c) |
Each Obligor shall (and shall procure that each other Obligor and each other member of the Group shall) maintain in effect a Sanctions compliance policy which is designed (giving regards to the recommendations of the Sanctions Advisory) to
ensure compliance by each such person and their respective managers, directors, officers, employees and agents with Sanctions.
|
(d) |
Each Obligor shall procure that each other Obligor and each other member of the Group will comply in all respects with Sanctions.
|
(e) |
No Obligor nor any other Obligor nor any other member of the Group shall be a Prohibited Person.
|
(f) |
No Obligor has or intends to have any business operations or other dealings involving Prohibited Persons and/or commodities or services of a Sanctioned Country or shipped to, through, or from such
country, or involving registered vessels or aircrafts owned by such a country.
|
(h) |
Restricted Lender:
|
(i) |
In connection with any amendment, waiver, determination or direction relating to the Sanctions Clauses of which a Lender does not have the benefit because such benefit would result in a violation by
the lender of any Anti Boycott Regulations (each a “Restricted Lender”), the Commitment or participation in the Loan, as applicable, of that Restricted Lender will, subject to paragraph (ii) below, be
excluded for the purpose of determining whether the consent of the Majority Lenders or all Lenders, as applicable, has been obtained or whether the determination or direction by the Majority Lenders or all Lenders, as applicable, has been
made or given.
|
(ii) |
The Facility Agent is only permitted to exclude the Commitment or participation in the Loan of a Lender pursuant to paragraph (i) above for the purpose of determining whether the consent of the Majority Lenders or all Lenders, as
applicable, has been obtained or whether the determination or direction by the Majority Lenders, or all Lenders, as applicable, has been made, if following the Facility Agent’s request for such consent, determination or direction by the
Majority Lenders or all Lenders, as applicable, the respective Lender notifies the Facility Agent that it is a Restricted Lender for such purpose.
|
22.27 |
Dry Dock Reserves
|
(a) |
Each Borrower shall ensure that its Dry Dock Reserve Account is credited with sufficient funding to cover forecasted dry‑docking and special survey expenses for its Ship in accordance with this Clause 22.27 (Dry Dock Reserves).
|
(c) |
On the Utilisation Date in respect of Tranche D, Borrower D shall credit its Dry Dock Reserve Account with $450,000.
|
22.28 |
Insurance
|
23 |
INSURANCE UNDERTAKINGS
|
23.1 |
General
|
23.2 |
Maintenance of obligatory insurances
|
(a) |
fire and usual marine risks (including hull and machinery, increased value and excess risks);
|
(b) |
war risks (including, but not limited to, piracy, hijacking, terrorism and confiscation);
|
(c) |
protection and indemnity risks (including oil pollution liability risks); and
|
(d) |
any other risks against which the Facility Agent acting on the instructions of the Majority Lenders considers, having regard to practices commonly utilised by first class companies of a similar size and in the same industry and other
circumstances prevailing at the relevant time, it would be reasonable for that Borrower to insure and which are specified by the Facility Agent by notice to that Borrower.
|
23.3 |
Terms of obligatory insurances
|
(a) |
in dollars;
|
(b) |
in the case of fire and usual marine risks and war risks, in an amount on an agreed value basis at least the greater of:
|
(i) |
120 per cent. of the Tranche relating to that Ship; and
|
(ii) |
the Fair Market Value of that Ship (determined by the then latest valuation in accordance with Clause 25 (Security Cover));
|
(c) |
in the case of oil pollution liability risks, for an aggregate amount equal to the highest level of cover from time to time available under basic protection and indemnity club entry with the International Group of Protection and Indemnity
Associations or if the International Group of Protection and Indemnity Associations cease to exist or operate, leading protection and indemnity associations managed in London;
|
(d) |
in the case of protection and indemnity risks, in respect of the full tonnage of its Ship;
|
(e) |
on approved terms; and
|
(f) |
through Approved Brokers and with approved insurance companies and/or underwriters or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks associations.
|
23.4 |
Further protections for the Finance Parties
|
(a) |
subject always to paragraph (b), name that Borrower as the sole named insured unless the interest of every other named insured is limited:
|
(i) |
in respect of any obligatory insurances for hull and machinery and war risks;
|
(A) |
to any provable out-of-pocket expenses that it has incurred and which form part of any recoverable claim on underwriters; and
|
(B) |
to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against it); and
|
(ii) |
in respect of any obligatory insurances for protection and indemnity risks, to any recoveries it is entitled to make by way of reimbursement following discharge of any third party liability claims made specifically against it;
|
(b) |
whenever the Majority Lenders require, name (or be amended to name) the Security Agent as additional named insured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation against the
Lenders, but without the Lenders being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
|
(c) |
name the Security Agent as loss payee with such directions for payment as the Facility Agent may specify;
|
(d) |
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Security Agent shall be made without set off, counterclaim or deductions or condition whatsoever;
|
(e) |
provide that the obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Security Agent or any other Finance Party; and
|
(f) |
provide that the Security Agent may make proof of loss if that Borrower fails to do so.
|
23.5 |
Renewal of obligatory insurances
|
(a) |
at least 21 days before the expiry of any obligatory insurance effected by it:
|
(i) |
notify the Security Agent of the Approved Brokers (or other insurers) and any protection and indemnity or war risks association through or with which it proposes to renew that obligatory insurance and of the proposed terms of renewal; and
|
(ii) |
obtain the Security Agent’s approval to the matters referred to in sub-paragraph (i) above;
|
(b) |
at least 14 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the provisions of Clause 23 (Insurance Undertakings); and
|
(c) |
procure that the Approved Brokers and/or the approved war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal notify the Facility Agent in writing of the terms and
conditions of the renewal.
|
23.6 |
Copies of policies; letters of undertaking
|
(a) |
(b) |
a letter or letters or undertaking in a form reasonably required by the Facility Agent having regard to the then current market practice of the IGA (International Group Agreement) P&I Clubs and the practices prescribed or recommended
by the IGA (International Group Agreement) or any successor association or body and/or the London Market Brokers Committee and/or any other professional association of which any Approved Brokers are members including undertakings by the
Approved Brokers that:
|
(i) |
they will not set off against any sum recoverable in respect of a claim relating to the Ship owned by that Borrower under such obligatory insurances any premiums or other amounts due to them or any other person whether in respect of that
Ship or otherwise, they waive any lien on the policies, or any sums received under them, which they might have in respect of such premiums or other amounts and they will not cancel such obligatory insurances by reason of non-payment of such
premiums or other amounts; and
|
(ii) |
they will arrange for a separate policy to be issued in respect of the Ship owned by that Borrower forthwith upon being so requested by the Facility Agent.
|
23.7 |
Copies of certificates of entry
|
(a) |
a certified copy of the certificate of entry for that Ship;
|
(b) |
a letter or letters of undertaking in such form as may be required by the Facility Agent acting on the instructions of Majority Lenders; and
|
(c) |
a certified copy of each certificate of financial responsibility for pollution by oil or other Environmentally Sensitive Material issued by the relevant certifying authority in relation to that Ship.
|
23.8 |
Deposit of original policies
|
23.9 |
Payment of premiums
|
23.10 |
Guarantees
|
23.11 |
Compliance with terms of insurances
|
(b) |
Without limiting paragraph (a) above, each Borrower shall:
|
(i) |
take all necessary action and comply with all requirements which may from time to time be applicable to the obligatory insurances, and ensure that the obligatory insurances are not made subject to any exclusions or qualifications to which
the Facility Agent has not given its prior approval;
|
(ii) |
not make any changes relating to the classification or classification society or manager or operator of the Ship owned by it unless approved by the underwriters of the obligatory insurances;
|
(iii) |
make (and promptly supply copies to the Facility Agent of) all quarterly or other voyage declarations which may be required by the protection and indemnity risks association in which the Ship owned by it is entered to maintain cover for
trading to the United States of America and Exclusive Economic Zone (as defined in the United States Oil Pollution Act 1990 or any other applicable legislation); and
|
(iv) |
not employ the Ship owned by it, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the obligatory insurances, without first obtaining the consent of the insurers and complying with any requirements
(as to extra premium or otherwise) which the insurers specify.
|
23.12 |
Alteration to terms of insurances
|
23.13 |
Settlement of claims
|
(a) |
not settle, compromise or abandon any claim under any obligatory insurance for Total Loss or for a Major Casualty; and
|
(b) |
do all things necessary and provide all documents, evidence and information to enable the Security Agent to collect or recover any moneys which at any time become payable in respect of the obligatory insurances.
|
23.14 |
Provision of copies of communications
|
(a) |
the Approved Brokers;
|
(b) |
the approved protection and indemnity and/or war risks associations; and
|
(c) |
the approved insurance companies and/or underwriters,
|
(i) |
that Borrower’s obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls; and
|
(ii) |
any credit arrangements made between that Borrower and any of the persons referred to in paragraphs (a) or (b) above relating wholly or partly to the effecting or maintenance of the obligatory insurances.
|
23.15 |
Provision of information
|
(a) |
obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
|
(b) |
effecting, maintaining or renewing any such insurances as are referred to in Clause 23.16 (Mortgagee’s interest and, additional perils insurances) or dealing with or considering any matters relating
to any such insurances,
|
23.16 |
Mortgagee’s interest and, additional perils insurances
|
(b) |
The Borrowers shall upon demand fully indemnify the Security Agent in respect of all premiums (in the case of MII and MAP, each in an amount up to 110 per cent. of the Loan) and other expenses which are incurred in connection with or with
a view to effecting, maintaining or renewing any insurance referred to in paragraph (a) above or dealing with, or considering, any matter arising out of any such insurance.
|
24 |
GENERAL SHIP UNDERTAKINGS
|
24.1 |
General
|
24.2 |
Ships’ names and registration
|
(a) |
keep that Ship registered in its name under the Approved Flag from time to time at its port of registration;
|
(b) |
use that Ship only as a civil merchant trading ship;
|
(c) |
not do or allow to be done anything as a result of which such registration might be suspended, cancelled or imperilled; and
|
(d) |
not change the name of that Ship without the prior written consent of the Facility Agent (such consent not to be unreasonably withheld or delayed),
|
(i) |
the Security Agent’s (acting on the instructions of the Majority Lenders) prior written consent;
|
(ii) |
that Ship remaining subject to Security securing the Secured Liabilities created by a first priority or preferred ship mortgage on that Ship and, if appropriate, a first priority deed of covenant collateral to that mortgage (or equivalent
first priority Security) on substantially the same terms as the Mortgage on that Ship and on such other terms and in such other form as the Facility Agent, acting with the authorisation of all the Lenders, shall approve or require; and
|
(iii) |
the execution of such other documentation amending and supplementing the Finance Documents as the Facility Agent, acting with the authorisation of all the Lenders, shall approve or require.
|
24.3 |
Repair and classification
|
(a) |
consistent with first class ship ownership and management practice; and
|
(b) |
so as to maintain the Approved Classification free of qualifications, conditions and overdue recommendations.
|
24.4 |
Modifications
|
24.5 |
Removal and installation of parts
|
(a) |
Subject to paragraph (b) below, no Borrower shall remove any material part of any Ship, or any item of equipment installed on any Ship unless:
|
(i) |
the part or item so removed is forthwith replaced by a suitable part or item which is in the same condition as or better condition than the part or item removed;
|
(ii) |
the replacement part or item is free from any Security in favour of any person other than the Security Agent; and
|
(iii) |
the replacement part or item becomes, on installation on that Ship, the property of that Borrower and subject to the security constituted by the Mortgage on that Ship.
|
(b) |
A Borrower may install equipment owned by a third party if the equipment can be removed without any risk of damage to the Ship owned by that Borrower.
|
24.6 |
Surveys
|
24.7 |
Inspection
|
24.8 |
Prevention of and release from arrest
|
(a) |
Each Borrower shall, in respect of the Ship owned by it (at its own cost) promptly discharge:
|
(i) |
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against that Ship, its Earnings or its Insurances;
|
(ii) |
all Taxes, dues and other amounts charged in respect of that Ship, its Earnings or its Insurances; and
|
(iii) |
all other outgoings whatsoever in respect of that Ship, its Earnings or its Insurances.
|
(b) |
Each Borrower shall immediately and, forthwith upon receiving notice of the arrest of the Ship owned by it or of its detention in exercise or purported exercise of any lien or claim, procure its release by providing bail or otherwise as
the circumstances may require.
|
24.9 |
Compliance with laws etc.
|
(a) |
comply, or procure compliance with all laws or regulations:
|
(i) |
relating to its business generally; and
|
(ii) |
relating to the Ship owned or operated by it, its ownership, employment, operation, management and registration,
|
(ii) |
the ISM Code, the ISPS Code, all Environmental Laws and the laws of the Approved Flag;
|
(b) |
obtain, comply with and do all that is necessary to maintain in full force and effect any Environmental Approvals;
|
(d) |
If a Ship is intended to be scrapped during the Security Period, take into account social and environmental matters when selecting the recycling yard and to comply with the Hong Kong International Convention for the Safe and
Environmentally Sound Recycling of Ships (2009) or, if applicable to that Ship and that Borrower, EU Ship Recycling Regulation of 20 November 2013.
|
24.10 |
ISPS Code
|
(a) |
procure that the Ship owned or operated by it and the company responsible for that Ship’s compliance with the ISPS Code comply with the ISPS Code; and
|
(b) |
maintain an ISSC for that Ship; and
|
(c) |
notify the Facility Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
|
24.11 |
Sanctions and Ship trading
|
(a) |
that the Ship owned or operated by it shall not be used by or for the benefit of a Prohibited Person;
|
(b) |
that such Ship shall not be used in trading to or from a Sanctioned Country or otherwise in any manner contrary to Sanctions (or which could be contrary to Sanctions if Sanctions were binding on each Obligor);
|
(c) |
that such Ship shall not be traded in any manner which would trigger the operation of any sanctions limitation or exclusion clause (or similar) in the Insurances;
|
(d) |
that such Ship shall maintain and operate automatic identification system (AIS) transponders in accordance with applicable IMO requirements; and
|
(e) |
that each charterparty in respect of that Ship shall contain, for the benefit of that Borrower, language which gives effect to the provisions of paragraph (c) of Clause 24.9 (Compliance with laws etc.)
as regards Sanctions and of this Clause 24.11 (Sanctions and Ship trading) and which permits refusal of employment or voyage orders if compliance would result in a breach of Sanctions (or which could
be contrary to Sanctions if Sanctions were binding on each Transaction Obligor).
|
24.12 |
Trading in war zones
|
(a) |
the prior written consent of the Ship’s war risks insurers has been given; and
|
(b) |
that Borrower has (at its expense) effected any special, additional or modified insurance cover which the Ship’s war risk insurers may require.
|
24.13 |
Provision of information
|
(a) |
that Ship, its employment, position and engagements;
|
(b) |
the Earnings and payments and amounts due to its master and crew;
|
(c) |
any expenditure incurred, or likely to be incurred, in connection with the operation, maintenance or repair of that Ship and any payments made by it in respect of that Ship;
|
(d) |
any towages and salvages; and
|
(e) |
its compliance, the Approved Manager’s compliance and the compliance of that Ship with the ISM Code and the ISPS Code,
|
24.14 |
Notification of certain events
|
(a) |
any Ship that is off hire at any time for a period of more than 30 consecutive days whether in accordance with the terms of a Charter or other contract of employment or otherwise;
|
(b) |
any casualty to that Ship which is or is likely to be or to become a Major Casualty;
|
(c) |
any occurrence as a result of which that Ship has become or is, by the passing of time or otherwise, likely to become a Total Loss;
|
(d) |
any requisition of that Ship for hire;
|
(e) |
any requirement or recommendation made in relation to that Ship by any insurer or classification society or by any competent authority which is not complied with within the specified period, if applicable;
|
(g) |
any intended dry docking of that Ship;
|
(j) |
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with,
|
24.15 |
Restrictions on chartering, appointment of managers etc.
|
(a) |
let that Ship on bareboat or demise charter for any period without the prior written consent of the Facility Agent (acting on the instructions of the Majority Lenders) (not to be unreasonably withheld);
|
(b) |
enter into any time, voyage or consecutive voyage charter in respect of that Ship other than a Permitted Charter without the prior written consent of the Facility Agent (acting on the instructions of the Majority Lenders) (not to be
unreasonably withheld);
|
(c) |
amend, supplement or terminate a Management Agreement otherwise than in accordance with its terms without the prior written consent of the Facility Agent (acting on the instructions of the Majority Lenders) or unless directed to by the
Facility Agent on an Event of Default;
|
(d) |
appoint a manager of that Ship other than an Approved Manager or agree to any material alteration to the terms of an Approved Manager’s appointment unless directed to by the Facility Agent on an Event of Default;
|
(e) |
de activate or lay up that Ship; or
|
(f) |
put that Ship into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed $1,000,000 (or the equivalent in any other currency) unless that person has first given to the Security
Agent and in terms satisfactory to it a written undertaking not to exercise any lien on that Ship or its Earnings for the cost of such work or for any other reason.
|
24.16 |
Notice of Mortgage
|
24.17 |
Sharing of Earnings
|
24.18 |
Poseidon Principles
|
24.19 |
Copy of “Green Passport” on board
|
(a) |
Each Borrower has, from the Utilisation Date, obtained an Inventory of Hazardous Materials, in respect of its Ship which shall be maintained on board until the Loan has been fully repaid.
|
(b) |
Each Borrower will ensure its Ship is or, if sold to an intermediary with the intention of being scrapped use its best endeavours that it is, recycled at a recycling yard which conducts its recycling business in a socially and
environmentally responsible manner, in accordance with the provisions of The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009 or, with regards to any EU flagged vessels, the EU Ship Recycling
Regulation.
|
24.20 |
Scrapping and recycling
|
24.21 |
Notification of compliance
|
25 |
SECURITY COVER
|
25.1 |
Minimum required security cover
|
(a) |
Clause 25.2 (Provision of additional security; prepayment) applies if from the Utilisation Date, the Facility Agent (acting on the instructions of the Security Agent) notifies the Borrowers that the
amount of the Loan is above the Relevant Percentage of the aggregate of:
|
(i) |
the aggregate Fair Market Value of each Ship then subject to a Mortgage; plus
|
(ii) |
the aggregate amount in the Dry Dock Reserve Accounts at that time; plus
|
(iii) |
the net realisable value of additional Security previously provided under this Clause 25 (Security Cover).
|
(b) |
For the purposes of this Clause 25 (Security Cover), “Relevant Percentage” means:
|
(i) |
for the period from (and including) the Utilisation Date until (but excluding) the date falling 12 months after the first Utilisation Date, 65 per cent.;
|
(ii) |
for the period from (and including) the date falling 12 months after the Utilisation Date until (but excluding) the date falling 24 months after the Utilisation Date, 63 per cent.;
|
(iii) |
for the period from (and including) the date falling 24 months after the Utilisation Date until (but excluding) the date falling 36 months after the Utilisation Date, 61 per cent.;
|
(iv) |
for the period from (and including) the date falling 36 months after the Utilisation Date until (but excluding) the date falling 48 months after the Utilisation Date, 59 per cent.; and
|
(v) |
for the period from (and including) the date falling 48 months after the Utilisation Date until the end of the Security Period, 57 per cent.
|
25.2 |
Provision of additional security; prepayment
|
(b) |
A Borrower may, instead of making a prepayment as described in paragraph (a) above, provide, or ensure that a third party has provided, additional security which, in the opinion of the Facility Agent acting on the instructions of the
Majority Lenders:
|
(i) |
has a net realisable value at least equal to the shortfall; and
|
(ii) |
is documented in such terms as the Facility Agent may approve or require,
|
25.3 |
Value of additional vessel security
|
25.4 |
Valuations binding
|
25.5 |
Provision of information
|
(b) |
If a Borrower fails to provide the information referred to in paragraph (a) above by the date specified in the request, the valuation may be made on any basis and assumptions which the shipbroker or the Facility Agent considers prudent.
|
25.6 |
Prepayment mechanism
|
25.7 |
Provision of valuations and determination of Fair Market Value
|
(b) |
In addition to paragraph (a) above, the Facility Agent (acting on the instructions of the Lenders) shall be entitled to request further determinations of the Fair Market Value at their own cost provided no Event of Default has occurred or
will occur following the provision of such determination.
|
(c) |
The cost of the determinations of the Fair Market Value pursuant to paragraph (a) of this Clause 25.7 (Provision of valuations and determination of Fair Market Value) shall be borne by the
Borrowers.
|
26 |
APPLICATION OF EARNINGS AND ACCOUNTS
|
26.1 |
Payment of Earnings
|
26.2 |
Location of Accounts
|
(a) |
comply with any requirement of the Facility Agent as to the location or relocation of its Earnings Accounts, Dry Dock Reserve Accounts, the Retention Accounts and the Liquidity Accounts (or any of them); and
|
(b) |
execute any documents which the Facility Agent specifies to create or maintain in favour of the Security Agent Security over (and/or rights of set-off, consolidation or other rights in relation to) the Earnings Accounts, Dry Dock Reserve
Accounts, the Retention Accounts and the Liquidity Accounts.
|
26.3 |
Retention Accounts
|
(a) |
Each Borrower shall from the Utilisation Date open and maintain a Retention Account.
|
(b) |
On an Event of Default, each Borrower shall transfer to and maintain on their Retention Account an amount equal to one third of the aggregate amount of the next Repayment Instalments and interest payment for the Tranche in respect of that
Borrower.
|
27 |
EVENTS OF DEFAULT
|
27.1 |
General
|
27.2 |
Non-payment
|
(a) |
its failure to pay is caused by:
|
(i) |
administrative or technical error; or
|
(ii) |
a Disruption Event; and
|
(b) |
payment is made within 3 Business Days of its due date.
|
27.3 |
Specific obligations
|
27.4 |
Other obligations
|
(b) |
No Event of Default under paragraph (a) above will occur if the failure to comply is capable of remedy and is remedied within 10 Business Days of the Facility Agent giving notice to the Borrowers or (if earlier) any Obligor becoming aware
of the failure to comply.
|
27.5 |
Misrepresentation
|
27.6 |
Cross default
|
(a) |
Any Financial Indebtedness of any member of the Group is not paid when due nor within any originally applicable grace period.
|
(b) |
Any Financial Indebtedness of any member of the Group is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (however described).
|
(c) |
Any commitment for any Financial Indebtedness of any member of the Group is cancelled or suspended by a creditor of any member of the Group as a result of an event of default (however described).
|
(e) |
No Event of Default will occur under this Clause 27.6 (Cross default) in respect of a Borrower if the aggregate amount of Financial Indebtedness or commitment for Financial Indebtedness falling
within paragraphs (a) to (d) above is less than $200,000 (or its equivalent in any other currency).
|
(f) |
No Event of Default will occur under this Clause 27.6 (Cross default) if the aggregate amount of Financial Indebtedness or commitment for Financial Indebtedness falling within paragraphs (a) to (d)
above is less than $2,000,000 (or its equivalent in any other currency).
|
27.7 |
Insolvency
|
(a) |
An Obligor:
|
(i) |
is unable or admits inability to pay its debts as they fall due;
|
(ii) |
is deemed to, or is declared to, be unable to pay its debts under applicable law;
|
(iii) |
suspends or threatens to suspend making payments on any of its debts; or
|
(iv) |
by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors (excluding any Finance Party in its capacity as such) with a view to rescheduling any of its indebtedness.
|
(b) |
The value of the assets of any Obligor is less than its liabilities (taking into account contingent and prospective liabilities).
|
(c) |
A moratorium is declared in respect of any indebtedness of any Obligor. If a moratorium occurs, the ending of the moratorium will not remedy any Event of Default caused by that moratorium.
|
(d) |
No Event of Default under paragraphs (a) to (c) above will occur if another Approved Manager is appointed by the Borrowers and such Approved Manager providing a duly executed Manager’s Undertaking to the Lenders within 30 days of the
Lender giving notice to the Borrowers or (if earlier) any Obligor becoming aware of such events described above.
|
27.8 |
Insolvency proceedings
|
(a) |
Any corporate action, legal proceedings or other procedure or step is taken in relation to:
|
(i) |
the suspension of payments, a moratorium of any indebtedness, seeking bankruptcy protection, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of any Obligor or
Approved Manager;
|
(ii) |
a composition, compromise, assignment or arrangement with any creditor of any Obligor or Approved Manager;
|
(iii) |
the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of any Obligor or Approved Manager or any of its assets; or
|
(iv) |
enforcement of any Security over any assets of any Obligor or Approved Manager,
|
(b) |
Paragraph (a) above shall not apply to any winding-up petition which is frivolous or vexatious and is discharged, stayed or dismissed within 14 days of commencement.
|
27.9 |
Creditors’ process
|
(a) |
the Borrowers; or
|
(b) |
a member of the Group (other than the Borrowers), having an aggregate value of $5,000,000 (in relation to such individual member of the Group) and which is not discharged within 14 days of the date it occurs.
|
27.10 |
Unlawfulness, invalidity and ranking
|
(a) |
It is or becomes unlawful for an Obligor to perform any of its obligations under the Finance Documents.
|
(b) |
Any obligation of an Obligor under the Finance Documents is not or ceases to be legal, valid, binding or enforceable.
|
(c) |
Any Finance Document ceases to be in full force and effect or to be continuing or is or purports to be determined or any Transaction Security is alleged by a party to it (other than a Finance Party) to be ineffective.
|
(d) |
Any Transaction Security proves to have ranked after, or loses its priority to, any other Security.
|
27.11 |
Security imperilled
|
27.12 |
Cessation of business
|
(a) |
Any Obligor suspends or ceases to carry on (or threatens to suspend or cease to carry on) all or a material part of its business.
|
(b) |
No Event of Default under paragraph (a) above will occur if another Approved Manager is appointed by the Borrowers and such Approved Manager providing a duly executed Manager’s Undertaking to the Lenders within 30 days of the Lender giving
notice to the Borrowers or (if earlier) any Obligor becoming aware of such event described above.
|
27.13 |
Arrest
|
27.14 |
Expropriation
|
27.15 |
Repudiation and rescission of agreements
|
27.16 |
Litigation
|
27.17 |
Material adverse change
|
27.18 |
Acceleration
|
(a) |
cancel the Total Commitments, whereupon they shall immediately be cancelled;
|
(c) |
declare that all or part of the Loan be payable on demand, whereupon it shall immediately become payable on demand by the Facility Agent acting on the instructions of the Majority Lenders; and/or
|
(d) |
exercise or direct the Security Agent to exercise any or all of its rights, remedies, powers or discretions under the Finance Documents,
|
27.19 |
Enforcement of security
|
28 |
CHANGES TO THE LENDERS
|
28.1 |
Assignments and transfers by the Lenders
|
(a) |
assign any of its rights; or
|
(b) |
transfer by novation any of its rights and obligations,
|
28.2 |
Conditions of assignment or transfer
|
(a) |
The consent of the Borrowers or any other party is not required for an assignment or transfer by an Existing Lender at any time.
|
(b) |
An assignment will only be effective on:
|
(i) |
receipt by the Facility Agent (whether in the Assignment Agreement or otherwise) of written confirmation from the New Lender (in form and substance satisfactory to the Facility Agent) that the New Lender will assume the same obligations to
the other Secured Parties as it would have been under if it were an Original Lender; and
|
(ii) |
performance by the Facility Agent of all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Facility Agent shall
promptly notify to the Existing Lender and the New Lender.
|
(c) |
Each Obligor agrees that all rights and interests (present, future or contingent) which the Existing Lender has under or by virtue of the Finance Documents are assigned to the New Lender absolutely, free of any defects in the Existing
Lender’s title and of any rights or equities which the Borrowers or any other Obligor had against the Existing Lender.
|
(d) |
A transfer will only be effective if the procedure set out in Clause 28.5 (Procedure for transfer) is complied with.
|
(e) |
If:
|
(i) |
a Lender assigns or transfers any of its rights or obligations under the Finance Documents or changes its Facility Office; and
|
(ii) |
as a result of circumstances existing at the date the assignment, transfer or change occurs, an Obligor would be obliged to make a payment to the New Lender or Lender acting through its new Facility Office under Clause 12 (Tax Gross Up and Indemnities) or under that clause as incorporated by reference or in full in any other Finance Document or Clause 13 (Increased Costs),
|
(f) |
Each New Lender, by executing the relevant Transfer Certificate or Assignment Agreement, confirms, for the avoidance of doubt, that the Facility Agent has authority to execute on its behalf any amendment or waiver that has been approved by
or on behalf of the requisite Lender or Lenders in accordance with this Agreement on or prior to the date on which the transfer or assignment becomes effective in accordance with this Agreement and that it is bound by that decision to the
same extent as the Existing Lender would have been had it remained a Lender.
|
28.3 |
Assignment or transfer fee
|
28.4 |
Limitation of responsibility of Existing Lenders
|
(a) |
Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:
|
(i) |
the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents, the Transaction Security or any other documents;
|
(ii) |
the financial condition of any Obligor;
|
(iii) |
the performance and observance by any Obligor of its obligations under the Finance Documents or any other documents; or
|
(iv) |
the accuracy of any statements (whether written or oral) made in or in connection with any Finance Document or any other document,
|
(b) |
Each New Lender confirms to the Existing Lender and the other Finance Parties and the Secured Parties that it:
|
(i) |
has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not
relied exclusively on any information provided to it by the Existing Lender or any other Finance Party in connection with any Finance Document or the Transaction Security; and
|
(ii) |
will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities throughout the Security Period.
|
(c) |
Nothing in any Finance Document obliges an Existing Lender to:
|
(i) |
accept a re-transfer or re-assignment from a New Lender of any of the rights and obligations assigned or transferred under this Clause 28 (Changes to the Lenders); or
|
(ii) |
support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Finance Documents or otherwise.
|
28.5 |
Procedure for transfer
|
(a) |
Subject to the conditions set out in Clause 28.2 (Conditions of assignment or transfer), a transfer is effected in accordance with paragraph (c) below when the Facility Agent executes an otherwise
duly completed Transfer Certificate delivered to it by the Existing Lender and the New Lender. The Facility Agent shall, subject to paragraph (b) below as soon as reasonably practicable after receipt by it of a duly completed Transfer
Certificate appearing on its face to comply with this Agreement and delivered in accordance with this Agreement, execute that Transfer Certificate.
|
(c) |
Subject to Clause 28.9 (Pro rata interest settlement), on the Transfer Date:
|
(i) |
to the extent that in the Transfer Certificate the Existing Lender seeks to transfer by novation its rights and obligations under the Finance Documents and in respect of the Transaction Security, each of the Obligors and the Existing
Lender shall be released from further obligations towards one another under the Finance Documents and in respect of the Transaction Security and their respective rights against one another under the Finance Documents and in respect of the
Transaction Security shall be cancelled (being the “Discharged Rights and Obligations”);
|
(ii) |
each of the Obligors and the New Lender shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as that Obligor and the New Lender have
assumed and/or acquired the same in place of that Obligor and the Existing Lender;
|
(iii) |
the Facility Agent, the Security Agent, the Arranger, the New Lender and other Lenders shall acquire the same rights and assume the same obligations between themselves and in respect of the Transaction Security as they would have acquired
and assumed had the New Lender been an Original Lender with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Facility Agent, the Security Agent, the Arranger and the Existing Lenders
shall each be released from further obligations to each other under the Finance Documents; and
|
(iv) |
the New Lender shall become a Party as a “Lender”.
|
28.6 |
Procedure for assignment
|
(a) |
Subject to the conditions set out in Clause 28.2 (Conditions of assignment or transfer) an assignment may be effected in accordance with paragraph (c) below when the Facility Agent executes an
otherwise duly completed Assignment Agreement delivered to it by the Existing Lender and the New Lender. The Facility Agent shall, subject to paragraph (b) below, as soon as reasonably practicable after receipt by it of a duly completed
Assignment Agreement appearing on its face to comply with the terms of this Agreement and delivered in accordance with the terms of this Agreement, execute that Assignment Agreement.
|
(c) |
Subject to Clause 28.9 (Pro rata interest settlement), on the Transfer Date:
|
(i) |
the Existing Lender will assign absolutely to the New Lender its rights under the Finance Documents and in respect of the Transaction Security expressed to be the subject of the assignment in the Assignment Agreement;
|
(ii) |
the Existing Lender will be released from the obligations (the “Relevant Obligations”) expressed to be the subject of the release in the Assignment Agreement (and any corresponding obligations by
which it is bound in respect of the Transaction Security); and
|
(iii) |
the New Lender shall become a Party as a “Lender” and will be bound by obligations equivalent to the Relevant Obligations.
|
(d) |
Lenders may utilise procedures other than those set out in this Clause 28.6 (Procedure for assignment) to assign their rights under the Finance Documents (but not, without the consent of the
relevant Obligor or unless in accordance with Clause 28.5 (Procedure for transfer), to obtain a release by that Obligor from the obligations owed to that Obligor by the Lenders nor the assumption of
equivalent obligations by a New Lender) provided that they comply with the conditions set out in Clause 28.2 (Conditions of assignment or transfer).
|
28.7 |
Copy of Transfer Certificate or Assignment Agreement to Borrowers
|
28.8 |
Security over Lenders’ rights
|
(a) |
any charge, assignment or other Security to secure obligations to a federal reserve or central bank; and
|
(b) |
in the case of any Lender which is a fund, any charge, assignment or other Security granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by that Lender as security for those
obligations or securities,
|
(i) |
release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security for such Lender as a party to any of the Finance Documents; or
|
(ii) |
require any payments to be made by an Obligor other than or in excess of, or grant to any person any more extensive rights than, those required to be made or granted to the relevant Lender under the Finance Documents.
|
28.9 |
Pro rata interest settlement
|
(a) |
any interest or fees in respect of the relevant participation which are expressed to accrue by reference to the lapse of time shall continue to accrue in favour of the Existing Lender up to but excluding the Transfer Date (“Accrued Amounts”) and shall become due and payable to the Existing Lender (without further interest accruing on them) on the last day of the current Interest Period; and
|
(b) |
The rights assigned or transferred by the Existing Lender will not include the right to the Accrued Amounts, so that, for the avoidance of doubt:
|
(i) |
when the Accrued Amounts become payable, those Accrued Amounts will be payable to the Existing Lender; and
|
(ii) |
the amount payable to the New Lender on that date will be the amount which would, but for the application of this Clause 28.9 (Pro rata interest settlement), have been payable to it on that date,
but after deduction of the Accrued Amounts.
|
(c) |
In this Clause 28.9 (Pro rata interest settlement) references to “Interest Period” shall be construed to include a reference to any other period for accrual of fees.
|
29 |
CHANGES TO THE OBLIGORS
|
29.1 |
Assignment or transfer by Obligors
|
29.2 |
Release of security
|
(a) |
If a disposal of any asset subject to security created by a Security Document is made in the following circumstances:
|
(i) |
the disposal is permitted by the terms of any Finance Document;
|
(ii) |
all the Lenders agree to the disposal;
|
(iii) |
the disposal is being made at the request of the Security Agent in circumstances where any security created by the Security Documents has become enforceable; or
|
(iv) |
the disposal is being effected by enforcement of a Security Document,
|
(b) |
If the Security Agent is satisfied that a release is allowed under this Clause 29.2 (Release of security) (at the request and expense of the Borrowers) each Finance Party must enter into any
document and do all such other things which are reasonably required to achieve that release. Each other Finance Party irrevocably authorises the Security Agent to enter into any such document. Any release will not affect the obligations of
any other Obligor under the Finance Documents.
|
30 |
THE FACILITY AGENT, THE ARRANGER AND THE REFERENCE BANKS
|
30.1 |
Appointment of the Facility Agent
|
(a) |
Each of the Arranger, the Lenders appoints the Facility Agent to act as its agent under and in connection with the Finance Documents.
|
(b) |
Each other Finance Party authorises the Facility Agent to perform the duties, obligations and responsibilities and to exercise the rights, powers, authorities and discretions specifically given to the Facility Agent under, or in connection
with, the Finance Documents together with any other incidental rights, powers, authorities and discretions.
|
30.2 |
Instructions
|
(a) |
The Facility Agent shall:
|
(A) |
all Lenders if the relevant Finance Document stipulates the matter is an all Lender decision; and
|
(B) |
in all other cases, the Majority Lenders; and
|
(ii) |
not be liable for any act (or omission) if it acts (or refrains from acting) in accordance with sub-paragraph (i) above (or, if this Agreement stipulates the matter is a decision for any other Finance Party or group of Finance Parties, in
accordance with instructions given to it by that Finance Party or group of Finance Parties).
|
(b) |
The Facility Agent shall be entitled to request instructions, or clarification of any instruction, from the Majority Lenders (or, if the relevant Finance Document stipulates the matter is a decision for any other Finance Party or group of
Finance Parties, from that Finance Party or group of Finance Parties) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the Facility Agent may refrain from acting
unless and until it receives any such instructions or clarification that it has requested.
|
(c) |
Save in the case of decisions stipulated to be a matter for any other Finance Party or group of Finance Parties under the relevant Finance Document and unless a contrary indication appears in a Finance Document, any instructions given to
the Facility Agent by the Majority Lenders shall override any conflicting instructions given by any other Parties and will be binding on all Finance Parties.
|
(d) |
Paragraph (a) above shall not apply:
|
(i) |
where a contrary indication appears in a Finance Document;
|
(ii) |
where a Finance Document requires the Facility Agent to act in a specified manner or to take a specified action;
|
(iii) |
in respect of any provision which protects the Facility Agent’s own position in its personal capacity as opposed to its role of Facility Agent for the relevant Finance Parties.
|
(e) |
If giving effect to instructions given by the Majority Lenders would in the Facility Agent’s opinion have an effect equivalent to an amendment or waiver referred to in Clause 43 (Amendments and Waivers),
the Facility Agent shall not act in accordance with those instructions unless consent to it so acting is obtained from each Party (other than the Facility Agent) whose consent would have been required in respect of that amendment or waiver.
|
(f) |
In exercising any discretion to exercise a right, power or authority under the Finance Documents where it has not received any instructions as to the exercise of that discretion the Facility Agent shall do so having regard to the interests
of all the Finance Parties.
|
(g) |
The Facility Agent may refrain from acting in accordance with any instructions of any Finance Party or group of Finance Parties until it has received any indemnification and/or security that it may in its discretion require (which may be
greater in extent than that contained in the Finance Documents and which may include payment in advance) for any cost, loss or liability (together with any applicable VAT) which it may incur in complying with those instructions.
|
(h) |
Without prejudice to the remainder of this Clause 30.2 (Instructions), in the absence of instructions, the Facility Agent shall not be obliged to take any action (or refrain from taking action) even
if it considers acting or not acting to be in the best interests of the Finance Parties. The Facility Agent may act (or refrain from acting) as it considers to be in the best interest of the Finance Parties.
|
30.3 |
Duties of the Facility Agent
|
(a) |
The Facility Agent’s duties under the Finance Documents are solely mechanical and administrative in nature.
|
(c) |
Without prejudice to Clause 28.7 (Copy of Transfer Certificate or Assignment Agreement to Borrower), paragraph (b) above shall not apply to any Transfer Certificate or any Assignment Agreement.
|
(d) |
Except where a Finance Document specifically provides otherwise, the Facility Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
|
(e) |
If the Facility Agent receives notice from a Party referring to any Finance Document, describing a Default and stating that the circumstance described is a Default, it shall promptly notify the other Finance Parties.
|
(f) |
If the Facility Agent is aware of the non-payment of any principal, interest, commitment fee or other fee payable to a Finance Party (other than the Facility Agent, the Arranger or the Security Agent) under this Agreement, it shall
promptly notify the other Finance Parties.
|
(g) |
The Facility Agent shall provide to the Borrowers within 10 Business Days of a request by the Borrowers (but no more frequently than once per calendar month), a list (which may be in electronic form) setting out the names of the Lenders as
at that Business Day, their respective Commitments, the address and fax number (and the department or officer, if any, for whose attention any communication is to be made) of each Lender for any communication to be made or document to be
delivered under or in connection with the Finance Documents, the electronic mail address and/or any other information required to enable the sending and receipt of information by electronic mail or other electronic means to and by each Lender
to whom any communication under or in connection with the Finance Documents may be made by that means and the account details of each Lender for any payment to be distributed by the Facility Agent to that Lender under the Finance Documents.
|
(h) |
The Facility Agent shall have only those duties, obligations and responsibilities expressly specified in the Finance Documents to which it is expressed to be a party (and no others shall be implied).
|
30.4 |
Role of the Arranger
|
30.5 |
No fiduciary duties
|
(a) |
Nothing in any Finance Document constitutes the Facility Agent or the Arranger as a trustee or fiduciary of any other person.
|
(b) |
Neither the Facility Agent nor the Arranger shall be bound to account to other Finance Party for any sum or the profit element of any sum received by it for its own account.
|
30.6 |
Application of receipts
|
30.7 |
Business with the Group
|
30.8 |
Rights and discretions
|
(a) |
The Facility Agent may:
|
(i) |
rely on any representation, communication, notice or document believed by it to be genuine, correct and appropriately authorised;
|
(ii) |
assume that:
|
(A) |
any instructions received by it from the Majority Lenders, any Finance Parties or any group of Finance Parties are duly given in accordance with the terms of the Finance Documents; and
|
(B) |
unless it has received notice of revocation, that those instructions have not been revoked; and
|
(iii) |
rely on a certificate from any person:
|
(A) |
as to any matter of fact or circumstance which might reasonably be expected to be within the knowledge of that person; or
|
(B) |
to the effect that such person approves of any particular dealing, transaction, step, action or thing,
|
(b) |
The Facility Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Finance Parties) that:
|
(i) |
no Default has occurred (unless it has actual knowledge of a Default arising under Clause 27.2 (Non-payment));
|
(ii) |
any right, power, authority or discretion vested in any Party or any group of Finance Parties has not been exercised; and
|
(iii) |
any notice or request made by any Borrower (other than the Utilisation Request or a Selection Notice) is made on behalf of and with the consent and knowledge of all the Obligors.
|
(c) |
The Facility Agent may reasonably engage and pay for the advice or services of any lawyers, accountants, tax advisers, surveyors or other professional advisers or experts.
|
(d) |
Without prejudice to the generality of paragraph (c) above or paragraph (e) below, the Facility Agent may at any time engage and pay for the services of any lawyers to act as independent counsel to the Facility Agent (and so separate from
any lawyers instructed by the Lenders) if the Facility Agent in its reasonable opinion deems this to be desirable.
|
(f) |
The Facility Agent may act in relation to the Finance Documents and the Security Property through its officers, employees and agents and shall not:
|
(i) |
be liable for any error of judgment made by any such person; or
|
(ii) |
be bound to supervise, or be in any way responsible for any loss incurred by reason of misconduct, omission or default on the part of any such person,
|
(g) |
Unless a Finance Document expressly provides otherwise the Facility Agent may disclose to any other Party any information it reasonably believes it has received as agent under the Finance Documents.
|
(h) |
Notwithstanding any other provision of any Finance Document to the contrary, neither the Facility Agent nor the Arranger is obliged to do or omit to do anything if it would or might, in its reasonable opinion, constitute a breach of any
law or regulation or a breach of a fiduciary duty or duty of confidentiality.
|
30.9 |
Responsibility for documentation
|
(a) |
the adequacy, accuracy or completeness of any information (whether oral or written) supplied by the Facility Agent, the Security Agent, the Arranger, an Obligor or any other person in, or in connection with, any Transaction Document or the
transactions contemplated in the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document;
|
(b) |
the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the Security Property or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in
connection with, any Transaction Document or the Security Property; or
|
(c) |
any determination as to whether any information provided or to be provided to any Finance Party or Secured Party is non-public information the use of which may be regulated or prohibited by applicable law or regulation relating to insider
dealing or otherwise.
|
30.10 |
No duty to monitor
|
(a) |
whether or not any Default has occurred;
|
(b) |
as to the performance, default or any breach by any Obligor of its obligations under any Transaction Document; or
|
(c) |
whether any other event specified in any Transaction Document has occurred.
|
30.11 |
Exclusion of liability
|
(a) |
Without limiting paragraph (b) below (and without prejudice to paragraph (e) of Clause 34.11 (Disruption to Payment Systems etc.) or any other provision of any Finance Document excluding or limiting
the liability of the Facility Agent), the Facility Agent will not be liable for:
|
(iii) |
any shortfall which arises on the enforcement or realisation of the Security Property; or
|
(iv) |
without prejudice to the generality of paragraphs (i) to (iii) above, any damages, costs or losses to any person, any diminution in value or any liability whatsoever arising as a result of:
|
(A) |
any act, event or circumstance not reasonably within its control; or
|
(B) |
the general risks of investment in, or the holding of assets in, any jurisdiction,
|
(c) |
The Facility Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Finance Documents to be paid by the Facility Agent if the Facility Agent has taken all necessary
steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by the Facility Agent for that purpose.
|
(d) |
Nothing in this Agreement shall oblige the Facility Agent or the Arranger to carry out:
|
(i) |
any “know your customer” or other checks in relation to any person; or
|
(ii) |
any check on the extent to which any transaction contemplated by this Agreement might be unlawful for any Finance Party,
|
(e) |
Without prejudice to any provision of any Finance Document excluding or limiting the Facility Agent’s liability, any liability of the Facility Agent arising under or in connection with any Transaction Document or the Security Property
shall be limited to the amount of actual loss which has been finally judicially determined to have been suffered (as determined by reference to the date of default of the Facility Agent or, if later, the date on which the loss arises as a
result of such default) but without reference to any special conditions or circumstances known to the Facility Agent at any time which increase the amount of that loss. In no event shall the Facility Agent be liable for any loss of profits,
goodwill, reputation, business opportunity or anticipated saving, or for special, punitive, indirect or consequential damages, whether or not the Facility Agent has been advised of the possibility of such loss or damages.
|
30.12 |
Lenders’ indemnity to the Facility Agent
|
(b) |
Subject to paragraph (c) below, the Borrowers shall immediately on demand reimburse any Lender for any payment that Lender makes to the Facility Agent pursuant to paragraph (a) above.
|
(c) |
Paragraph (b) above shall not apply to the extent that the indemnity payment in respect of which a Lender claims reimbursement relates to a liability of the Facility Agent to an Obligor.
|
30.13 |
Resignation of the Facility Agent
|
(a) |
The Facility Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Finance Parties and the Borrowers.
|
(b) |
Alternatively, the Facility Agent may resign by giving 30 days’ notice to the other Finance Parties and the Borrowers, in which case the Majority Lenders may appoint a successor Facility Agent.
|
(d) |
If the Facility Agent wishes to resign because (acting reasonably) it has concluded that it is no longer appropriate for it to remain as agent and the Facility Agent is entitled to appoint a successor Facility Agent under paragraph (c)
above, the Facility Agent may (if it concludes (acting reasonably) that it is necessary to do so in order to persuade the proposed successor Facility Agent to become a party to this Agreement as Facility Agent) agree with the proposed
successor Facility Agent amendments to this Clause 30 (The Facility Agent, the Arranger and the Reference Banks) and any other term of this Agreement dealing with the rights or obligations of the
Facility Agent consistent with then current market practice for the appointment and protection of corporate trustees together with any reasonable amendments to the agency fee payable under this Agreement which are consistent with the
successor Facility Agent’s normal fee rates and those amendments will bind the Parties.
|
(f) |
The Facility Agent’s resignation notice shall only take effect upon the appointment of a successor.
|
(g) |
Upon the appointment of a successor, the retiring Facility Agent shall be discharged from any further obligation in respect of the Finance Documents (other than its obligations under paragraph (e) above) but shall remain entitled to the
benefit of Clause 14.4 (Indemnity to the Facility Agent) and this Clause 30 (The Facility Agent, the Arranger and the Reference Banks) and any other provisions
of a Finance Document which are expressed to limit or exclude its liability (or to indemnify it) in acting as Facility Agent. Any fees for the account of the retiring Facility Agent shall cease to accrue from (and shall be payable on) that
date). Any successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original Party.
|
(h) |
The Majority Lenders may, by notice to the Facility Agent, require it to resign in accordance with paragraph (b) above. In this event, the Facility Agent shall resign in accordance with paragraph (b) above but the cost referred to in
paragraph (e) above shall be for the account of the Borrowers.
|
(i) |
The consent of any Borrower (or any other Obligor) is not required for an assignment or transfer of rights and/or obligations by the Facility Agent.
|
(i) |
the Facility Agent fails to respond to a request under Clause 12.7 (FATCA Information) and the Borrowers or a Lender reasonably believes that the Facility Agent will not be (or will have ceased to
be) a FATCA Exempt Party on or after that FATCA Application Date;
|
(ii) |
the information supplied by the Facility Agent pursuant to Clause 12.7 (FATCA Information) indicates that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after
that FATCA Application Date; or
|
(iii) |
the Facility Agent notifies the Borrowers and the Lenders that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;
|
30.14 |
Confidentiality
|
(a) |
In acting as Facility Agent for the Finance Parties, the Facility Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from any other of its divisions or departments.
|
(b) |
If information is received by a division or department of the Facility Agent other than the division or department responsible for complying with the obligations assumed by it under the Finance Documents, that information may be treated as
confidential to that division or department, and the Facility Agent shall not be deemed to have notice of it nor shall it be obliged to disclose such information to any Party.
|
(c) |
Notwithstanding any other provision of any Finance Document to the contrary, neither the Facility Agent nor the Arranger is obliged to disclose to any other person (i) any confidential information or (ii) any other information if the
disclosure would, or might in its reasonable opinion, constitute a breach of any law or regulation or a breach of a fiduciary duty.
|
30.15 |
Relationship with the other Finance Parties
|
(a) |
Subject to Clause 28.9 (Pro rata interest settlement), the Facility Agent may treat the person shown in its records as Lender at the opening of business (in the place of the Facility Agent’s
principal office as notified to the Finance Parties from time to time) as such Lender acting through its Facility Office:
|
(i) |
entitled to or liable for any payment due under any Finance Document on that day; and
|
(ii) |
entitled to receive and act upon any notice, request, document or communication or make any decision or determination under any Finance Document made or delivered on that day,
|
30.16 |
Credit appraisal by the Finance Parties
|
(a) |
the financial condition, status and nature of each member of the Group;
|
(b) |
the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document, the Security Property and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection
with any Transaction Document or the Security Property;
|
(c) |
whether that Finance Party has recourse, and the nature and extent of that recourse, against any Party or any of its respective assets under, or in connection with, any Transaction Document, the Security Property, the transactions
contemplated by the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document or the Security Property;
|
(d) |
the adequacy, accuracy or completeness of any other information provided by the Facility Agent, any Party or by any other person under, or in connection with, any Transaction Document, the transactions contemplated by any Transaction
Document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document; and
|
(e) |
the right or title of any person in or to or the value or sufficiency of any part of the Security Assets, the priority of any of the Transaction Security or the existence of any Security affecting the Security Assets.
|
30.17 |
Deduction from amounts payable by the Facility Agent
|
30.18 |
Reliance and engagement letters
|
30.19 |
Full freedom to enter into transactions
|
(b) |
to deal in and enter into and arrange transactions relating to:
|
(i) |
any securities issued or to be issued by any Obligor or any other person; or
|
(ii) |
any options or other derivatives in connection with such securities; and
|
(c) |
to provide advice or other services to any Borrower or any person who is a party to, or referred to in, a Finance Document,
|
30.20 |
Role of Reference Banks
|
(a) |
No Reference Bank is under any obligation to provide a quotation or any other information to the Facility Agent.
|
(b) |
No Reference Bank will be liable for any action taken by it under or in connection with any Finance Document, or for any Reference Bank Quotation, unless directly caused by its gross negligence or wilful misconduct.
|
(c) |
No Party (other than the relevant Reference Bank) may take any proceedings against any officer, employee or agent of any Reference Bank in respect of any claim it might have against that Reference Bank or in respect of any act or omission
of any kind by that officer, employee or agent in relation to any Finance Document, or to any Reference Bank Quotation, and any officer, employee or agent of each Reference Bank may rely on this Clause 30.20 (Role
of Reference Banks) subject to Clause 1.5 (Third party rights) and the provisions of the Third Parties Act.
|
30.21 |
Third Party Reference Banks
|
31 |
THE SECURITY AGENT
|
31.1 |
Trust
|
(b) |
Each other Finance Party authorises the Security Agent to perform the duties, obligations and responsibilities and to exercise the rights, powers, authorities and discretions specifically given to the Security Agent under, or in connection
with, the Finance Documents together with any other incidental rights, powers, authorities and discretions.
|
31.2 |
Parallel Debt (Covenant to pay the Security Agent)
|
(a) |
Each Obligor irrevocably and unconditionally undertakes to pay to the Security Agent its Parallel Debt which shall be amounts equal to, and in the currency or currencies of, its Corresponding Debt.
|
(b) |
The Parallel Debt of an Obligor:
|
(i) |
shall become due and payable at the same time as its Corresponding Debt;
|
(ii) |
is independent and separate from, and without prejudice to, its Corresponding Debt.
|
(c) |
For purposes of this Clause 31.2 (Parallel Debt (Covenant to pay the Security Agent)), the Security Agent:
|
(i) |
is the independent and separate creditor of each Parallel Debt;
|
(ii) |
acts in its own name and not as agent, representative or trustee of the Finance Parties and its claims in respect of each Parallel Debt shall not be held on trust; and
|
(iii) |
shall have the independent and separate right to demand payment of each Parallel Debt in its own name (including, without limitation, through any suit, execution, enforcement of security, recovery of guarantees and applications for and
voting in any kind of insolvency proceeding).
|
(d) |
The Parallel Debt of an Obligor shall be:
|
(i) |
decreased to the extent that its Corresponding Debt has been irrevocably and unconditionally paid or discharged; and
|
(ii) |
increased to the extent that its Corresponding Debt has increased,
|
(A) |
decreased to the extent that its Parallel Debt has been irrevocably and unconditionally paid or discharged; and
|
(B) |
increased to the extent that its Parallel Debt has increased,
|
(e) |
All amounts received or recovered by the Security Agent in connection with this Clause 31.2 (Parallel Debt (Covenant to pay the Security Agent)) to the extent permitted by applicable law, shall be
applied in accordance with Clause 34.5 (Application of receipts; partial payments).
|
(f) |
This Clause 31.2 (Parallel Debt (Covenant to pay the Security Agent)) shall apply, with any necessary modifications, to each Finance Document.
|
31.3 |
Enforcement through Security Agent only
|
31.4 |
Instructions
|
(a) |
The Security Agent shall:
|
(i) |
unless a contrary indication appears in a Finance Document, exercise or refrain from exercising any right, power, authority or discretion vested in it as Security Agent in accordance with any instructions given to it by:
|
(A) |
all Lenders if the relevant Finance Document stipulates the matter is an all Lender decision; and
|
(B) |
in all other cases, the Majority Lenders; and
|
(ii) |
not be liable for any act (or omission) if it acts (or refrains from acting) in accordance with sub-paragraph (i) above (or if this Agreement stipulates the matter is a decision for any other Finance Party or group of Finance Parties, in
accordance with instructions given to it by that Finance Party or group of Finance Parties).
|
(b) |
The Security Agent shall be entitled to request instructions, or clarification of any instruction, from the Majority Lenders (or, if the relevant Finance Document stipulates the matter is a decision for any other Finance Party or group of
Finance Parties, from that Finance Party or group of Finance Parties) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the Security Agent may refrain from acting
unless and until it receives any such instructions or clarification that it has requested.
|
(c) |
Save in the case of decisions stipulated to be a matter for any other Finance Party or group of Finance Parties under the relevant Finance Document and unless a contrary indication appears in a Finance Document, any instructions given to
the Security Agent by the Majority Lenders shall override any conflicting instructions given by any other Parties and will be binding on all Finance Parties.
|
(d) |
Paragraph (a) above shall not apply:
|
(i) |
where a contrary indication appears in a Finance Document;
|
(ii) |
where a Finance Document requires the Security Agent to act in a specified manner or to take a specified action;
|
(iii) |
in respect of any provision which protects the Security Agent’s own position in its personal capacity as opposed to its role of Security Agent for the relevant Secured Parties.
|
(iv) |
in respect of the exercise of the Security Agent’s discretion to exercise a right, power or authority under any of:
|
(A) |
Clause 31.27 (Application of receipts);
|
(B) |
Clause 31.28 (Permitted Deductions); and
|
(C) |
Clause 31.29 (Prospective liabilities).
|
(e) |
If giving effect to instructions given by the Majority Lenders would in the Security Agent’s opinion have an effect equivalent to an amendment or waiver referred to in Clause 43 (Amendments and Waivers),
the Security Agent shall not act in accordance with those instructions unless consent to it so acting is obtained from each Party (other than the Security Agent) whose consent would have been required in respect of that amendment or waiver.
|
(f) |
In exercising any discretion to exercise a right, power or authority under the Finance Documents where either:
|
(i) |
it has not received any instructions as to the exercise of that discretion; or
|
(ii) |
the exercise of that discretion is subject to sub-paragraph (iv) of paragraph (d) above,
|
(g) |
The Security Agent may refrain from acting in accordance with any instructions of any Finance Party or group of Finance Parties until it has received any indemnification and/or security that it may in its discretion require (which may be
greater in extent than that contained in the Finance Documents and which may include payment in advance) for any cost, loss or liability (together with any applicable VAT) which it may incur in complying with those instructions.
|
(h) |
Without prejudice to the remainder of this Clause 31.4 (Instructions), in the absence of instructions, the Security Agent may (but shall not be obliged to) take such action in the exercise of its
powers and duties under the Finance Documents as it considers in its discretion to be appropriate.
|
(i) |
The Security Agent is not authorised to act on behalf of a Finance Party (without first obtaining that Finance Party’s consent) in any legal or arbitration proceedings relating to any Finance Document. This paragraph (i) shall not apply
to any legal or arbitration proceeding relating to the perfection, preservation or protection of rights under the Security Documents or enforcement of the Transaction Security or Security Documents.
|
31.5 |
Duties of the Security Agent
|
(a) |
The Security Agent’s duties under the Finance Documents are solely mechanical and administrative in nature.
|
(b) |
The Security Agent shall promptly forward to a Party the original or a copy of any document which is delivered to the Security Agent for that Party by any other Party.
|
(c) |
Except where a Finance Document specifically provides otherwise, the Security Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
|
(d) |
If the Security Agent receives notice from a Party referring to any Finance Document, describing a Default and stating that the circumstance described is a Default, it shall promptly notify the other Finance Parties.
|
(e) |
The Security Agent shall have only those duties, obligations and responsibilities expressly specified in the Finance Documents to which it is expressed to be a party (and no others shall be implied).
|
31.6 |
No fiduciary duties
|
(a) |
Nothing in any Finance Document constitutes the Security Agent as an agent, trustee or fiduciary of any Obligor.
|
(b) |
The Security Agent shall not be bound to account to any other Secured Party for any sum or the profit element of any sum received by it for its own account.
|
31.7 |
Business with the Group
|
31.8 |
Rights and discretions
|
(a) |
The Security Agent may:
|
(i) |
rely on any representation, communication, notice or document believed by it to be genuine, correct and appropriately authorised;
|
(ii) |
assume that:
|
(A) |
any instructions received by it from the Majority Lenders, any Finance Parties or any group of Finance Parties are duly given in accordance with the terms of the Finance Documents;
|
(B) |
unless it has received notice of revocation, that those instructions have not been revoked;
|
(C) |
if it receives any instructions to act in relation to the Transaction Security, that all applicable conditions under the Finance Documents for so acting have been satisfied; and
|
(iii) |
rely on a certificate from any person:
|
(A) |
as to any matter of fact or circumstance which might reasonably be expected to be within the knowledge of that person; or
|
(B) |
to the effect that such person approves of any particular dealing, transaction, step, action or thing,
|
(b) |
The Security Agent shall be entitled to carry out all dealings with the other Finance Parties through the Facility Agent and may give to the Facility Agent any notice or other communication required to be given by the Security Agent to any
Finance Party.
|
(c) |
The Security Agent may assume (unless it has received notice to the contrary in its capacity as security agent for the Secured Parties) that:
|
(i) |
no Default has occurred;
|
(ii) |
any right, power, authority or discretion vested in any Party or any group of Finance Parties has not been exercised; and
|
(iii) |
any notice or request made by any Borrower (other than the Utilisation Request or a Selection Notice) is made on behalf of and with the consent and knowledge of all the Obligors.
|
(d) |
The Security Agent may engage and pay for the advice or services of any lawyers, accountants, tax advisers, surveyors or other professional advisers or experts.
|
(e) |
Without prejudice to the generality of paragraph (c) above or paragraph (f) below, the Security Agent may at any time engage and pay for the services of any lawyers to act as independent counsel to the Security Agent (and so separate from
any lawyers instructed by the Facility Agent or the Lenders) if the Security Agent in its reasonable opinion deems this to be desirable.
|
(g) |
The Security Agent may act in relation to the Finance Documents and the Security Property through its officers, employees and agents and shall not:
|
(i) |
be liable for any error of judgment made by any such person; or
|
(ii) |
be bound to supervise, or be in any way responsible for any loss incurred by reason of misconduct, omission or default on the part of any such person,
|
(h) |
Unless a Finance Document expressly provides otherwise the Security Agent may disclose to any other Party any information it reasonably believes it has received as security agent under the Finance Documents.
|
(i) |
Notwithstanding any other provision of any Finance Document to the contrary, the Security Agent is not obliged to do or omit to do anything if it would or might, in its reasonable opinion, constitute a breach of any law or regulation or a
breach of a fiduciary duty or duty of confidentiality.
|
(j) |
Notwithstanding any provision of any Finance Document to the contrary, the Security Agent is not obliged to expend or risk its own funds or otherwise incur any financial liability in the performance of its duties, obligations or
responsibilities or the exercise of any right, power, authority or discretion if it has grounds for believing the repayment of such funds or adequate indemnity against, or security for, such risk or liability is not reasonably assured to it.
|
31.9 |
Responsibility for documentation
|
(a) |
the adequacy, accuracy or completeness of any information (whether oral or written) supplied by the Facility Agent, the Security Agent, the Arranger, an Obligor or any other person in, or in connection with, any Transaction Document or the
transactions contemplated in the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document;
|
(b) |
the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the Security Property or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in
connection with, any Transaction Document or the Security Property; or
|
(c) |
any determination as to whether any information provided or to be provided to any Secured Party is non-public information the use of which may be regulated or prohibited by applicable law or regulation relating to insider dealing or
otherwise.
|
31.10 |
No duty to monitor
|
(a) |
whether or not any Default has occurred;
|
(b) |
as to the performance, default or any breach by any Obligor of its obligations under any Transaction Document; or
|
(c) |
whether any other event specified in any Transaction Document has occurred.
|
31.11 |
Exclusion of liability
|
(a) |
Without limiting paragraph (b) below (and without prejudice to any other provision of any Finance Document excluding or limiting the liability of the Security Agent or any Receiver or Delegate), none of the Security Agent nor any Receiver
or Delegate will be liable for:
|
(ii) |
exercising, or not exercising, any right, power, authority or discretion given to it by, or in connection with, any Transaction Document, the Security Property or any other agreement, arrangement or document entered into, made or executed
in anticipation of, under or in connection with, any Transaction Document or the Security Property; or
|
(iii) |
any shortfall which arises on the enforcement or realisation of the Security Property; or
|
(iv) |
without prejudice to the generality of paragraphs (i) to (iii) above, any damages, costs or losses to any person, any diminution in value or any liability whatsoever arising as a result of:
|
(A) |
any act, event or circumstance not reasonably within its control; or
|
(B) |
the general risks of investment in, or the holding of assets in, any jurisdiction,
|
(c) |
The Security Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Finance Documents to be paid by the Security Agent if the Security Agent has taken all necessary
steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by the Security Agent for that purpose.
|
(d) |
Nothing in this Agreement shall oblige the Security Agent to carry out:
|
(i) |
any “know your customer” or other checks in relation to any person; or
|
(ii) |
any check on the extent to which any transaction contemplated by this Agreement might be unlawful for any Finance Party,
|
(e) |
Without prejudice to any provision of any Finance Document excluding or limiting the liability of the Security Agent, any Receiver or Delegate, any liability of the Security Agent, any Receiver or Delegate arising under or in connection
with any Transaction Document or the Security Property shall be limited to the amount of actual loss which has been finally judicially determined to have been suffered (as determined by reference to the date of default of the Security Agent,
Receiver or Delegate or, if later, the date on which the loss arises as a result of such default) but without reference to any special conditions or circumstances known to the Security Agent, any Receiver or Delegate at any time which
increase the amount of that loss. In no event shall the Security Agent, any Receiver or Delegate be liable for any loss of profits, goodwill, reputation, business opportunity or anticipated saving, or for special, punitive, indirect or
consequential damages, whether or not the Security Agent, the Receiver or Delegate has been advised of the possibility of such loss or damages.
|
31.12 |
Lenders’ indemnity to the Security Agent
|
(a) |
Each Lender shall (in proportion to its share of the Total Commitments or, if the Total Commitments are then zero, to its share of the Total Commitments immediately prior to their reduction to zero) indemnify the Security Agent and every
Receiver and every Delegate, within three Business Days of demand, against any cost, loss or liability incurred by any of them (otherwise than by reason of the Security Agent’s, Receiver’s or Delegate’s gross negligence or wilful misconduct)
in acting as Security Agent, Receiver or Delegate under the Finance Documents (unless the Security Agent, Receiver or Delegate has been reimbursed by an Obligor pursuant to a Finance Document).
|
(b) |
Subject to paragraph (c) below, the Borrowers shall immediately on demand reimburse any Lender for any payment that Lender makes to the Security Agent pursuant to paragraph (a) above.
|
(c) |
Paragraph (b) above shall not apply to the extent that the indemnity payment in respect of which a Lender claims reimbursement relates to a liability of the Security Agent to an Obligor.
|
31.13 |
Resignation of the Security Agent
|
(a) |
The Security Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Finance Parties and the Borrowers.
|
(b) |
Alternatively, the Security Agent may resign by giving 30 days’ notice to the other Finance Parties and the Borrowers, in which case the Majority Lenders may appoint a successor Security Agent.
|
(c) |
If the Majority Lenders have not appointed a successor Security Agent in accordance with paragraph (b) above within 20 days after notice of resignation was given, the retiring Security Agent may appoint a successor Security Agent.
|
(e) |
The Security Agent’s resignation notice shall only take effect upon:
|
(i) |
the appointment of a successor; and
|
(ii) |
the transfer, by way of a document expressed as a deed, of all the Security Property to that successor.
|
(f) |
Upon the appointment of a successor, the retiring Security Agent shall be discharged, by way of a document executed as a deed, from any further obligation in respect of the Finance Documents (other than its obligations under paragraph (b)
of Clause 31.24 (Winding up of trust) and paragraph (d) above) but shall remain entitled to the benefit of Clause 14.5 (Indemnity to the Security Agent) and
this Clause 31 (The Security Agent) and any other provisions of a Finance Document which are expressed to limit or exclude its liability (or to indemnify it) in acting as Security Agent. Any fees for
the account of the retiring Security Agent shall cease to accrue from (and shall be payable on) that date). Any successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if
such successor had been an original Party.
|
(g) |
The Majority Lenders may, by notice to the Security Agent, require it to resign in accordance with paragraph (b) above. In this event, the Security Agent shall resign in accordance with paragraph (b) above but the cost referred to in
paragraph (d) above shall be for the account of the Borrowers.
|
(h) |
The consent of any Borrower (or any other Obligor) is not required for an assignment or transfer of rights and/or obligations by the Security Agent.
|
31.14 |
Confidentiality
|
(a) |
In acting as Security Agent for the Finance Parties, the Security Agent shall be regarded as acting through its trustee division which shall be treated as a separate entity from any other of its divisions or departments.
|
(b) |
If information is received by a division or department of the Security Agent other than the division or department responsible for complying with the obligations assumed by it under the Finance Documents, that information may be treated as
confidential to that division or department, and the Security Agent shall not be deemed to have notice of it nor shall it be obliged to disclose such information to any Party.
|
(c) |
Notwithstanding any other provision of any Finance Document to the contrary, the Security Agent is not obliged to disclose to any other person (i) any confidential information or (ii) any other information if the disclosure would, or might
in its reasonable opinion, constitute a breach of any law or regulation or a breach of a fiduciary duty.
|
31.15 |
Credit appraisal by the Finance Parties
|
(a) |
the financial condition, status and nature of each member of the Group;
|
(b) |
the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document, the Security Property and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection
with any Transaction Document or the Security Property;
|
(c) |
whether that Finance Party has recourse, and the nature and extent of that recourse, against any Party or any of its respective assets under, or in connection with, any Transaction Document, the Security Property, the transactions
contemplated by the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document or the Security Property;
|
(d) |
the adequacy, accuracy or completeness of any other information provided by the Security Agent, any Party or by any other person under, or in connection with, any Transaction Document, the transactions contemplated by any Transaction
Document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document; and
|
(e) |
the right or title of any person in or to or the value or sufficiency of any part of the Security Assets, the priority of any of the Transaction Security or the existence of any Security affecting the Security Assets.
|
31.16 |
Reliance and engagement letters
|
31.17 |
No responsibility to perfect Transaction Security
|
(a) |
require the deposit with it of any deed or document certifying, representing or constituting the title of any Obligor to any of the Security Assets;
|
(b) |
obtain any licence, consent or other authority for the execution, delivery, legality, validity, enforceability or admissibility in evidence of any Finance Document or the Transaction Security;
|
(c) |
register, file or record or otherwise protect any of the Transaction Security (or the priority of any of the Transaction Security) under any law or regulation or to give notice to any person of the execution of any Finance Document or of
the Transaction Security;
|
(d) |
take, or to require any Obligor to take, any step to perfect its title to any of the Security Assets or to render the Transaction Security effective or to secure the creation of any ancillary Security under any law or regulation; or
|
(e) |
require any further assurance in relation to any Security Document.
|
31.18 |
Insurance by Security Agent
|
(a) |
The Security Agent shall not be obliged:
|
(i) |
to insure any of the Security Assets;
|
(ii) |
to require any other person to maintain any insurance; or
|
(iii) |
to verify any obligation to arrange or maintain insurance contained in any Finance Document,
|
(b) |
Where the Security Agent is named on any insurance policy as an insured party, it shall not be liable for any damages, costs or losses to any person as a result of its failure to notify the insurers of any material fact relating to the
risk assumed by such insurers or any other information of any kind, unless the Majority Lenders request it to do so in writing and the Security Agent fails to do so within 14 days after receipt of that request.
|
31.19 |
Custodians and nominees
|
31.20 |
Delegation by the Security Agent
|
(a) |
Each of the Security Agent, any Receiver and any Delegate may, at any time, delegate by power of attorney or otherwise to any person for any period, all or any right, power, authority or discretion vested in it in its capacity as such.
|
(b) |
That delegation may be made upon any terms and conditions (including the power to sub delegate) and subject to any restrictions that the Security Agent, that Receiver or that Delegate (as the case may be) may, in its discretion, think fit
in the interests of the Secured Parties.
|
(c) |
No Security Agent, Receiver or Delegate shall be bound to supervise, or be in any way responsible for any damages, costs or losses incurred by reason of any misconduct, omission or default on the part of any such delegate or sub delegate.
|
31.21 |
Additional Security Agents
|
(a) |
The Security Agent may at any time appoint (and subsequently remove) any person to act as a separate trustee or as a co-trustee jointly with it:
|
(i) |
if it considers that appointment to be in the interests of the Secured Parties; or
|
(ii) |
for the purposes of conforming to any legal requirement, restriction or condition which the Security Agent deems to be relevant; or
|
(iii) |
for obtaining or enforcing any judgment in any jurisdiction,
|
(b) |
Any person so appointed shall have the rights, powers, authorities and discretions (not exceeding those given to the Security Agent under or in connection with the Finance Documents) and the duties, obligations and responsibilities that
are given or imposed by the instrument of appointment.
|
(c) |
The remuneration that the Security Agent may pay to that person, and any costs and expenses (together with any applicable VAT) incurred by that person in performing its functions pursuant to that appointment shall, for the purposes of this
Agreement, be treated as costs and expenses incurred by the Security Agent.
|
31.22 |
Acceptance of title
|
31.23 |
Releases
|
31.24 |
Winding up of trust
|
(a) |
all of the Secured Liabilities and all other obligations secured by the Security Documents have been fully and finally discharged; and
|
(i) |
the trusts set out in this Agreement shall be wound up and the Security Agent shall release, without recourse or warranty, all of the Transaction Security and the rights of the Security Agent under each of the Security Documents; and
|
(ii) |
any Security Agent which has resigned pursuant to Clause 31.13 (Resignation of the Security Agent) shall release, without recourse or warranty, all of its rights under each Security Document.
|
31.25 |
Powers supplemental to Trustee Acts
|
31.26 |
Disapplication of Trustee Acts
|
31.27 |
Application of receipts
|
(a) |
in discharging any sums owing to the Security Agent (in its capacity as such) (other than pursuant to Clause 31.2 (Parallel Debt (Covenant to pay the Security Agent)), any Receiver or any Delegate;
|
(b) |
in payment or distribution to the Facility Agent, on its behalf and on behalf of the other Secured Parties, for application towards the discharge of all sums due and payable by any Obligor under any of the Finance Documents in accordance
with Clause 34.5 (Application of receipts; partial payments);
|
(c) |
if none of the Obligors is under any further actual or contingent liability under any Finance Document, in payment or distribution to any person to whom the Security Agent is obliged to pay or distribute in priority to any Obligor; and
|
(d) |
the balance, if any, in payment or distribution to the relevant Obligor.
|
31.28 |
Permitted Deductions
|
(a) |
set aside by way of reserve amounts required to meet, and to make and pay, any deductions and withholdings (on account of Taxes or otherwise) which it is or may be required by any applicable law to make from any distribution or payment
made by it under this Agreement; and
|
(b) |
pay all Taxes which may be assessed against it in respect of any of the Security Property, or as a consequence of performing its duties, or by virtue of its capacity as Security Agent under any of the Finance Documents or otherwise (other
than in connection with its remuneration for performing its duties under this Agreement).
|
31.29 |
Prospective liabilities
|
(a) |
any sum to the Security Agent, any Receiver or any Delegate; and
|
(b) |
any part of the Secured Liabilities,
|
31.30 |
Investment of proceeds
|
31.31 |
Currency conversion
|
(a) |
For the purpose of, or pending the discharge of, any of the Secured Liabilities the Security Agent may convert any moneys received or recovered by the Security Agent from one currency to another, at a market rate of exchange.
|
(b) |
The obligations of any Obligor to pay in the due currency shall only be satisfied to the extent of the amount of the due currency purchased after deducting the costs of conversion.
|
31.32 |
Good discharge
|
(b) |
The Security Agent is under no obligation to make the payments to the Facility Agent under paragraph (a) above in the same currency as that in which the obligations and liabilities owing to the relevant Finance Party are denominated.
|
31.33 |
Amounts received by Obligors
|
31.34 |
Application and consideration
|
31.35 |
Full freedom to enter into transactions
|
(b) |
to deal in and enter into and arrange transactions relating to:
|
(i) |
any securities issued or to be issued by any Obligor or any other person; or
|
(ii) |
any options or other derivatives in connection with such securities; and
|
(c) |
to provide advice or other services to the Borrowers or any person who is a party to, or referred to in, a Finance Document,
|
32 |
CONDUCT OF BUSINESS BY THE FINANCE PARTIES
|
(a) |
interfere with the right of any Finance Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
|
(b) |
oblige any Finance Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
|
(c) |
oblige any Finance Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax.
|
33 |
SHARING AMONG THE FINANCE PARTIES
|
33.1 |
Payments to Finance Parties
|
(a) |
the Recovering Finance Party shall, within three Business Days, notify details of the receipt or recovery, to the Facility Agent;
|
(b) |
the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Finance Party would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in
accordance with Clause 34 (Payment Mechanics), without taking account of any Tax which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and
|
(c) |
the Recovering Finance Party shall, within three Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the “Sharing Payment”) equal to such receipt or recovery less any
amount which the Facility Agent determines may be retained by the Recovering Finance Party as its share of any payment to be made, in accordance with Clause 34.5 (Application of receipts; partial payments).
|
33.2 |
Redistribution of payments
|
33.3 |
Recovering Finance Party’s rights
|
33.4 |
Reversal of redistribution
|
(a) |
each Sharing Finance Party shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Finance Party an amount equal to the appropriate part of its share of the Sharing Payment (together with an
amount as is necessary to reimburse that Recovering Finance Party for its proportion of any interest on the Sharing Payment which that Recovering Finance Party is required to pay) (the “Redistributed Amount”);
and
|
(b) |
as between the relevant Obligor and each relevant Sharing Finance Party, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by that Obligor.
|
33.5 |
Exceptions
|
(a) |
This Clause 33 (Sharing among the Finance Parties) shall not apply to the extent that the Recovering Finance Party would not, after making any payment pursuant to this Clause, have a valid and
enforceable claim against the relevant Obligor.
|
(b) |
A Recovering Finance Party is not obliged to share with any other Finance Party any amount which the Recovering Finance Party has received or recovered as a result of taking legal or arbitration proceedings, if:
|
(i) |
it notified that other Finance Party of the legal or arbitration proceedings; and
|
(ii) |
that other Finance Party had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings.
|
34 |
PAYMENT MECHANICS
|
34.1 |
Payments to the Facility Agent
|
(a) |
On each date on which an Obligor or a Lender is required to make a payment under a Finance Document, that Obligor or Lender shall make an amount equal to such payment available to the Facility Agent (unless a contrary indication appears in
a Finance Document) for value on the due date at the time and in such funds specified by the Facility Agent as being customary at the time for settlement of transactions in the relevant currency in the place of payment.
|
(b) |
Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to euro, in a principal financial centre in such Participating Member State or London, as specified by the Facility
Agent) and with such bank as the Facility Agent, in each case, specifies.
|
34.2 |
Distributions by the Facility Agent
|
34.3 |
Distributions to an Obligor
|
34.4 |
Clawback and pre-funding
|
(a) |
Where a sum is to be paid to the Facility Agent under the Finance Documents for another Party, the Facility Agent is not obliged to pay that sum to that other Party (or to enter into or perform any related exchange contract) until it has
been able to establish to its satisfaction that it has actually received that sum.
|
(b) |
Unless paragraph (c) below applies, if the Facility Agent pays an amount to another Party and it proves to be the case that the Facility Agent had not actually received that amount, then the Party to whom that amount (or the proceeds of
any related exchange contract) was paid by the Facility Agent shall on demand refund the same to the Facility Agent together with interest on that amount from the date of payment to the date of receipt by the Facility Agent, calculated by the
Facility Agent to reflect its cost of funds.
|
(i) |
the Facility Agent shall notify the Borrowers of that Lender’s identity and the Borrowers shall on demand refund it to the Facility Agent; and
|
(ii) |
such Lender by whom those funds should have been made available or, if the Lender fails to do so, the Borrowers, shall on demand pay to the Facility Agent the amount (as certified by the Facility Agent) which will indemnify the Facility
Agent against any funding cost incurred by it as a result of paying out that sum before receiving those funds from that Lender.
|
34.5 |
Application of receipts; partial payments
|
(ii) |
secondly, in or towards payment of any accrued interest and fees due but unpaid to the Lenders under this Agreement;
|
(iii) |
thirdly, in or towards payment of any principal due but unpaid to the Lenders under this Agreement;
|
(iv) |
fourthly, in or towards payment pro rata of any other sum due to any Finance Party but unpaid under the Finance Documents.
|
(b) |
The Facility Agent shall, if so directed by the Lenders, vary the order set out in sub-paragraphs (ii) to (iv) of paragraph (a) above.
|
(c) |
Paragraphs (a) and (b) above will override any appropriation made by an Obligor.
|
34.6 |
No set-off by Obligors
|
34.7 |
Business Days
|
(a) |
Any payment under the Finance Documents which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).
|
(b) |
During any extension of the due date for payment of any principal or an Unpaid Sum under this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on the original due date.
|
34.8 |
Currency of account
|
(a) |
Subject to paragraphs (b) and (c) below, dollars is the currency of account and payment for any sum due from an Obligor under any Finance Document.
|
(b) |
Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred.
|
(c) |
Any amount expressed to be payable in a currency other than dollars shall be paid in that other currency.
|
34.9 |
Change of currency
|
(a) |
Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:
|
(i) |
any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the
Facility Agent (after consultation with the Borrowers); and
|
(ii) |
any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Facility
Agent (acting reasonably).
|
(b) |
If a change in any currency of a country occurs, this Agreement will, to the extent the Facility Agent (acting reasonably and after consultation with the Borrowers) specifies to be necessary, be amended to comply with any generally
accepted conventions and market practice in the Relevant Market and otherwise to reflect the change in currency.
|
34.10 |
Currency Conversion
|
(a) |
For the purpose of, or pending any payment to be made by any Servicing Party under any Finance Document, such Servicing Party may convert any moneys received or recovered by it from one currency to another, at a market rate of exchange.
|
(b) |
The obligations of any Obligor to pay in the due currency shall only be satisfied to the extent of the amount of the due currency purchased after deducting the costs of conversion.
|
34.11 |
Disruption to Payment Systems etc.
|
(b) |
the Facility Agent shall not be obliged to consult with the Borrowers in relation to any changes mentioned in paragraph (a) above if, in its reasonable opinion, it is not practicable to do so in the circumstances and, in any event, shall
have no obligation to agree to such changes;
|
(c) |
the Facility Agent may consult with the Finance Parties in relation to any changes mentioned in paragraph (a) above but shall not be obliged to do so if, in its opinion, it is not practicable to do so in the circumstances;
|
(f) |
the Facility Agent shall notify the Finance Parties of all changes agreed pursuant to paragraph (d) above.
|
35 |
SET-OFF
|
36 |
BAIL-IN
|
(a) |
any Bail-In Action in relation to any such liability, including (without limitation):
|
(i) |
a reduction, in full or in part, in the principal amount, or outstanding amount due (including any accrued but unpaid interest) in respect of any such liability;
|
(ii) |
a conversion of all, or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, it; and
|
(iii) |
a cancellation of any such liability; and
|
(b) |
a variation of any term of any Finance Document to the extent necessary to give effect to any Bail-In Action in relation to any such liability.
|
37 |
NOTICES
|
37.1 |
Communications in writing
|
37.2 |
Addresses
|
(a) |
in the case of the Borrowers, that specified in Schedule 1 (The Parties);
|
(b) |
in the case of each Lender or any other Obligor, that specified in Schedule 1 (The Parties) or, if it becomes a Party after the date of this Agreement, that notified in writing to the Facility Agent
on or before the date on which it becomes a Party;
|
(c) |
in the case of the Facility Agent, that specified in Schedule 1 (The Parties); and
|
(d) |
in the case of the Security Agent, that specified in Schedule 1 (The Parties),
|
37.3 |
Delivery
|
(a) |
Any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective:
|
(i) |
if by way of fax, when received in legible form; or
|
(ii) |
if by way of letter, when it has been left at the relevant address or five Business Days after being deposited in the post postage prepaid in an envelope addressed to it at that address,
|
(b) |
Any communication or document to be made or delivered to a Servicing Party will be effective only when actually received by that Servicing Party and then only if it is expressly marked for the attention of the department or officer of that
Servicing Party specified in Schedule 1 (The Parties) (or any substitute department or officer as that Servicing Party shall specify for this purpose).
|
(c) |
All notices from or to an Obligor shall be sent through the Facility Agent unless otherwise specified in any Finance Document.
|
(d) |
Any communication or document made or delivered to the Borrowers in accordance with this Clause will be deemed to have been made or delivered to each of the Obligors.
|
(e) |
Any communication or document which becomes effective, in accordance with paragraphs (a) to (d) above, after 5.00 p.m. in the place of receipt shall be deemed only to become effective on the following day.
|
37.4 |
Notification of address and fax number
|
37.5 |
Electronic communication
|
(i) |
notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and
|
(ii) |
notify each other of any change to their address or any other such information supplied by them by not less than five Business Days’ notice.
|
(d) |
Any electronic communication which becomes effective, in accordance with paragraph (c) above, after 5.00 p.m. in the place in which the Party to whom the relevant communication is sent or made available has its address for the purpose of
this Agreement shall be deemed only to become effective on the following day.
|
(e) |
Any reference in a Finance Document to a communication being sent or received shall be construed to include that communication being made available in accordance with this Clause 37.5 (Electronic
communication).
|
37.6 |
English language
|
(a) |
Any notice given under or in connection with any Finance Document must be in English.
|
(b) |
All other documents provided under or in connection with any Finance Document must be:
|
(i) |
in English; or
|
(ii) |
if not in English, and if so required by the Facility Agent, accompanied by a certified English translation prepared by a translator approved by the Facility Agent and, in this case, the English translation will prevail unless the document
is a constitutional, statutory or other official document.
|
38 |
CALCULATIONS AND CERTIFICATES
|
38.1 |
Accounts
|
38.2 |
Certificates and determinations
|
38.3 |
Day count convention and interest calculation
|
39 |
PARTIAL INVALIDITY
|
40 |
REMEDIES AND WAIVERS
|
41 |
SETTLEMENT OR DISCHARGE CONDITIONAL
|
42 |
IRREVOCABLE PAYMENT
|
43 |
AMENDMENTS AND WAIVERS
|
43.1 |
Required consents
|
(a) |
Subject to Clause 43.2 (All Lender matters) and Clause 43.3 (Other exceptions) any term of the Finance Documents may be amended or waived only with the
consent of the Majority Lenders and, in the case of an amendment, the Obligors and any such amendment or waiver will be binding on all Parties.
|
(b) |
The Facility Agent may effect, on behalf of any Finance Party, any amendment or waiver permitted by this Clause 43 (Amendments and Waivers).
|
(c) |
Without prejudice to the generality of Clause 30.8 (Rights and discretions), the Facility Agent may engage, pay for and rely on the services of lawyers in determining the consent level required for
and effecting any amendment, waiver or consent under this Agreement.
|
43.2 |
All Lender matters
|
(a) |
the definition of “Majority Lenders” in Clause 1.1 (Definitions);
|
(b) |
a postponement to or extension of the date of payment of any amount under the Finance Documents (other than in relation to Clause 7.4 (Voluntary prepayment of Loan) in respect of a prepayment made
pursuant to Clause 25.2 (Provision of additional security; prepayment), Clause 7.5 (Mandatory prepayment on sale or Total Loss);
|
(c) |
a reduction in the Margin or the amount of any payment of principal, interest, fees or commission payable;
|
(d) |
a change in currency of payment of any amount under the Finance Documents;
|
(e) |
an increase in any Commitment or the Total Commitments, an extension of any Availability Period or any requirement that a cancellation of Commitments reduces the Commitments rateably under the Facility;
|
(f) |
a change to any Obligor;
|
(g) |
any provision which expressly requires the consent of all the Lenders;
|
(h) |
this Clause 43 (Amendments and Waivers);
|
(i) |
any change to the preamble (Background), Clause 2 (The Facility), Clause 3 (Purpose), Clause 5 (Utilisation), Clause
9 (Interest), Clause 22.11 (Negative pledge), Clause 22.12 (Disposals), Clause 22.13 (Merger),
paragraph (c) of Clause 22.14 (Change of business), Clause 24.2 (Ships’ names and registration), Clause 24.3 (Repair and
classification), Clause 24.4 (Modifications), Clause 24.5 (Removal and installation of parts), Clause 26 (Application
of Earnings and Accounts), Clause 28 (Changes to the Lenders), Clause 47 (Governing Law) or Clause 48 (Enforcement);
|
(j) |
any release (whether in part or in full) of, or material variation to, or limitation of enforcement to any Transaction Security, guarantee, indemnity or subordination arrangement set out in a Finance Document (except in the case of a
release of Transaction Security as it relates to the disposal of an asset which is the subject of the Transaction Security and where such disposal is expressly permitted by the Majority Lenders or otherwise under a Finance Document);
|
(k) |
(other than as expressly permitted by the provisions of any Finance Document), the nature or scope of:
|
(i) |
the guarantee and indemnity granted under Clause 17 (Guarantee and Indemnity – Parent Guarantor);
|
(ii) |
the joint and several liability of the Borrowers under Clause 18 (Joint and Several Liability of the Borrowers);
|
(iii) |
the Security Assets; or
|
(iv) |
the manner in which the proceeds of enforcement of the Transaction Security are distributed,
|
(v) |
the release of the guarantees and indemnities granted under Clause 17 (Guarantee and Indemnity – Parent Guarantor), the joint and several liability of the Borrowers under Clause 18 (Joint and Several Liability of the Borrowers) or of any Transaction Security unless permitted under this Agreement or any other Finance Document or relating to a sale or disposal of an asset which is the
subject of the Transaction Security where such sale or disposal is expressly permitted under this Agreement or any other Finance Document,
|
43.3 |
Other exceptions
|
43.4 |
Changes to reference rates
|
(a) |
Subject to Clause 43.3 (Other exceptions), if a Published Rate Replacement Event has occurred in relation to a Published Rate, any amendment or waiver which relates to:
|
(i) |
providing for the use of a Replacement Reference Rate in place of that Published Rate; and
|
(A) |
aligning any provision of any Finance Document to the use of that Replacement Reference Rate;
|
(B) |
enabling that Replacement Reference Rate to be used for the calculation of interest under this Agreement (including, without limitation, any consequential changes required to enable that Replacement Reference Rate to be used for the
purposes of this Agreement);
|
(C) |
implementing market conventions applicable to that Replacement Reference Rate;
|
(D) |
providing for appropriate fallback (and market disruption) provisions for that Replacement Reference Rate; or
|
(E) |
adjusting the pricing to reduce or eliminate, to the extent reasonably practicable, any transfer of economic value from one Party to another as a result of the application of that Replacement Reference Rate (and if any adjustment or method
for calculating any adjustment has been formally designated, nominated or recommended by the Relevant Nominating Body, the adjustment shall be determined on the basis of that designation, nomination or recommendation),
|
(b) |
If any Lender fails to respond to a request for an amendment or waiver described in paragraph (a) or (b) above within three Business Days (or such longer time period in relation to any request which the Borrower and the Facility Agent may
agree) of that request being made:
|
(i) |
its Commitment or its participation in the Loan (as the case may be) shall not be included for the purpose of calculating the Total Commitments or the amount of the Loan (as applicable) when ascertaining whether any relevant percentage of
Total Commitments or the aggregate of participations in the Loan (as applicable) has been obtained to approve that request; and
|
(ii) |
its status as a Lender shall be disregarded for the purpose of ascertaining whether the agreement of any specified group of Lenders has been obtained to approve that request.
|
(c) |
In this Clause 43.4 (Changes to reference rates):
|
(a) |
Term SOFR for any Term SOFR Quoted Tenor;
|
(b) |
SOFR; or
|
(c) |
the Screen Rate.
|
(a) |
the methodology, formula or other means of determining that Published Rate has, in the opinion of the Majority Lenders, and the Borrower materially changed;
|
(A) |
the administrator of that Published Rate or its supervisor publicly announces that such administrator is insolvent; or
|
(B) |
information is published in any order, decree, notice, petition or filing, however described, of or filed with a court, tribunal, exchange, regulatory authority or similar administrative, regulatory or judicial body which reasonably
confirms that the administrator of that Published Rate is insolvent,
|
(ii) |
the administrator of that Published Rate publicly announces that it has ceased or will cease, to provide that Published Rate permanently or indefinitely and, at that time, there is no successor administrator to continue to provide that
Published Rate;
|
(iii) |
the supervisor of the administrator of that Published Rate publicly announces that such Published Rate has been or will be permanently or indefinitely discontinued; or
|
(iv) |
the administrator of that Published Rate or its supervisor announces that that Published Rate may no longer be used; or
|
(c) |
in the case of the Screen Rate for any Quoted Tenor, the supervisor of the administrator of that Screen Rate makes a public announcement or publishes information:
|
(i) |
stating that that Screen Rate for that Quoted Tenor is no longer, or as of a specified future date will no longer be, representative of the underlying market or the economic reality that it is intended to measure and that
representativeness will not be restored (as determined by such supervisor); and
|
(ii) |
with awareness that any such announcement or publication will engage certain triggers for fallback provisions in contracts which may be activated by any such pre-cessation announcement or publication; or
|
(d) |
in the opinion of the Majority Lenders and the Borrower, that Published Rate is otherwise no longer appropriate for the purposes of calculating interest under this Agreement.
|
(a) |
formally designated, nominated or recommended as the replacement for a Published Rate by:
|
(i) |
the administrator of that Published Rate (provided that the market or economic reality that such reference rate measures is the same as that measured by that Published Rate); or
|
(ii) |
any Relevant Nominating Body,
|
(iii) |
and if replacements have, at the relevant time, been formally designated, nominated or recommended under both paragraphs, the “Replacement Reference Rate” will be the replacement under sub-paragraph (ii) above;
|
(b) |
in the opinion of the Majority Lenders and the Borrower, generally accepted in the international or any relevant domestic syndicated loan markets as the appropriate successor or alternative to a Published Rate; or
|
(c) |
in the opinion of the Majority Lenders and the Borrower, an appropriate successor or alternative to a Published Rate.
|
44 |
CONFIDENTIAL INFORMATION
|
44.1 |
Confidentiality
|
44.2 |
Disclosure of Confidential Information
|
(b) |
to any person:
|
(iv) |
who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in sub-paragraph (i) or (ii) of paragraph (b) above;
|
(vi) |
to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitrations, administrative or other investigations, proceedings or disputes;
|
(vii) |
to whom or for whose benefit that Finance Party charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 28.8 (Security over Lenders’ rights);
|
(viii) |
which is a classification society or other entity which a Lender has engaged to make the calculations necessary to enable that Lender to comply with its reporting obligations under the Poseidon Principles;
|
(ix) |
who is a Party, a member of the Group or any related entity of an Obligor;
|
(x) |
as a result of the registration of any Finance Document as contemplated by any Finance Document or any legal opinion obtained in connection with any Finance Document; or
|
(xi) |
with the consent of the Parent Guarantor;
|
(A) |
in relation to sub-paragraphs (i), (ii) and (iii) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking except that there shall be no requirement for a
Confidentiality Undertaking if the recipient is a professional adviser and is subject to professional obligations to maintain the confidentiality of the Confidential Information;
|
(B) |
in relation to sub-paragraph (iv) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking or is otherwise bound by requirements of confidentiality in relation to
the Confidential Information they receive and is informed that some or all of such Confidential Information may be price-sensitive information;
|
(C) |
in relation to sub-paragraphs (v) (vi) and (vii) of paragraph (b) above, the person to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be
price-sensitive information except that there shall be no requirement to so inform if, in the opinion of that Finance Party, it is not practicable so to do in the circumstances;
|
(d) |
to any rating agency (including its professional advisers) such Confidential Information as may be required to be disclosed to enable such rating agency to carry out its normal rating activities in relation to the Finance Documents and/or
the Obligors if the rating agency to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price-sensitive information.
|
44.3 |
DAC6
|
44.4 |
Disclosure to numbering service providers
|
(i) |
names of Obligors;
|
(ii) |
country of domicile of Obligors;
|
(iii) |
place of incorporation of Obligors;
|
(iv) |
date of this Agreement;
|
(v) |
Clause 47 (Governing Law);
|
(vi) |
the names of the Facility Agent and the Arranger;
|
(vii) |
date of each amendment and restatement of this Agreement;
|
(viii) |
amount of Total Commitments;
|
(ix) |
currency of the Facility;
|
(x) |
type of Facility;
|
(xi) |
ranking of Facility;
|
(xii) |
Termination Date for Facility;
|
(xiii) |
changes to any of the information previously supplied pursuant to sub-paragraphs (i) to (xii) above; and
|
(xiv) |
such other information agreed between such Finance Party and the Borrowers,
|
(b) |
The Parties acknowledge and agree that each identification number assigned to this Agreement, the Facility and/or one or more Obligors by a numbering service provider and the information associated with each such number may be disclosed to
users of its services in accordance with the standard terms and conditions of that numbering service provider.
|
(c) |
Each Obligor represents, on behalf of itself and the other Obligors, that none of the information set out in sub-paragraphs (i) to (xiv) of paragraph (a) above is, nor will at any time be, unpublished price-sensitive information.
|
(d) |
The Facility Agent shall notify the Parent Guarantor and the other Finance Parties of:
|
(i) |
the name of any numbering service provider appointed by the Facility Agent in respect of this Agreement, the Facility and/or one or more Obligors; and
|
(ii) |
the number or, as the case may be, numbers assigned to this Agreement, the Facility and/or one or more Obligors by such numbering service provider.
|
44.5 |
Entire agreement
|
44.6 |
Inside information
|
44.7 |
Notification of disclosure
|
(a) |
of the circumstances of any disclosure of Confidential Information made pursuant to sub-paragraph (v) of paragraph (b) of Clause 44.2 (Disclosure of Confidential Information) except where such
disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
|
(b) |
upon becoming aware that Confidential Information has been disclosed in breach of this Clause 44 (Confidential Information).
|
44.8 |
Continuing obligations
|
(a) |
the date on which all amounts payable by the Obligors under or in connection with this Agreement have been paid in full and all Commitments have been cancelled or otherwise cease to be available; and
|
(b) |
the date on which such Finance Party otherwise ceases to be a Finance Party.
|
45 |
CONFIDENTIALITY OF FUNDING RATES AND REFERENCE BANK QUOTATIONS
|
45.1 |
Confidentiality and disclosure
|
(a) |
The Facility Agent and each Obligor agree to keep each Funding Rate (and, in the case of the Facility Agent, each Reference Bank Quotation) confidential and not to disclose it to anyone, save to the extent permitted by paragraphs (b), (c)
and (d) below.
|
(b) |
The Facility Agent may disclose:
|
(i) |
any Funding Rate (but not, for the avoidance of doubt, any Reference Bank Quotation) to the Borrowers pursuant to Clause 8.4 (Notification of rates of interest); and
|
(ii) |
any Funding Rate or any Reference Bank Quotation to any person appointed by it to provide administration services in respect of one or more of the Finance Documents to the extent necessary to enable such service provider to provide those
services if the service provider to whom that information is to be given has entered into a confidentiality agreement substantially in the form of the LMA Master Confidentiality Undertaking for Use With Administration/Settlement Service
Providers or such other form of confidentiality undertaking agreed between the Facility Agent and the relevant Lender or Reference Bank, as the case may be.
|
(c) |
The Facility Agent may disclose any Funding Rate or any Reference Bank Quotation, and each Obligor may disclose any Funding Rate, to:
|
(iii) |
any person to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes if the person to whom that Funding Rate or
Reference Bank Quotation is to be given is informed in writing of its confidential nature and that it may be price sensitive information except that there shall be no requirement to so inform if, in the opinion of the Facility Agent or the
relevant Obligor, as the case may be, it is not practicable to do so in the circumstances; and
|
(iv) |
any person with the consent of the relevant Lender or Reference Bank, as the case may be.
|
45.2 |
Related obligations
|
(a) |
The Facility Agent and each Obligor acknowledge that each Funding Rate (and, in the case of the Facility Agent, each Reference Bank Quotation) is or may be price sensitive information and that its use may be regulated or prohibited by
applicable legislation including securities law relating to insider dealing and market abuse and the Facility Agent and each Obligor undertake not to use any Funding Rate or, in the case of the Facility Agent, any Reference Bank Quotation for
any unlawful purpose.
|
(b) |
The Facility Agent and each Obligor agree (to the extent permitted by law and regulation) to inform the relevant Lender or Reference Bank, as the case may be:
|
(i) |
of the circumstances of any disclosure made pursuant to sub-paragraph (ii) of paragraph (c) of Clause 45.1 (Confidentiality and disclosure) except where such disclosure is made to any of the persons
referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
|
(ii) |
upon becoming aware that any information has been disclosed in breach of this Clause 45 (Confidentiality of Funding Rates and Reference Bank Quotations).
|
45.3 |
No Event of Default
|
46 |
COUNTERPARTS
|
47 |
GOVERNING LAW
|
48 |
ENFORCEMENT
|
48.1 |
Jurisdiction
|
(a) |
The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or any non-contractual
obligation arising out of or in connection with this Agreement) (a “Dispute”).
|
(b) |
The Obligors accept that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Obligor will argue to the contrary.
|
(c) |
This Clause 48.1 (Jurisdiction) is for the benefit of the Secured Parties only. As a result, no Secured Party shall be prevented from taking proceedings relating to a Dispute in any other courts
with jurisdiction. To the extent allowed by law, the Secured Parties may take concurrent proceedings in any number of jurisdictions.
|
48.2 |
Service of process
|
(a) |
Without prejudice to any other mode of service allowed under any relevant law, each Obligor (other than an Obligor incorporated in England and Wales):
|
(i) |
irrevocably appoints Hill Dickinson Services (London) Limited at its registered office for the time being presently at The Broadgate Tower, 20 Primrose Street, London EC2A 2EW, England as its agent for service of process in relation to any
proceedings before the English courts in connection with any Finance Document; and
|
(ii) |
agrees that failure by a process agent to notify the relevant Obligor of the process will not invalidate the proceedings concerned.
|
(b) |
If any person appointed as an agent for service of process is unable for any reason to act as agent for service of process, the Borrowers (on behalf of all the Obligors) must immediately (and in any event within 5 days of such event taking
place) appoint another agent on terms acceptable to the Facility Agent. Failing this, the Facility Agent may appoint another agent for this purpose.
|
Name of Borrower
|
Place of Incorporation
|
Address for Communication
|
MULAN SHIPPING CO.
|
Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
JOHNNY BRAVO SHIPPING CO.
|
Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
SONGOKU SHIPPING CO.
|
Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
ASTERIX SHIPPING CO.
|
Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
STEWIE SHIPPING CO.
|
Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
Name of Parent Guarantor
|
Place of Incorporation
|
Address for Communication
|
CASTOR MARITIME INC.
|
The Republic of the Marshall Islands
|
c/o Castor Ships S.A.
25 Foinikos Str. 14564
Nea Kifissia, Athens Greece
Fax No: + 357 25357796
|
Name of Original Lender
|
Commitment
|
Address for Communication
|
DEUTSCHE BANK AG
|
$55,000,000
|
Adolphsplatz 7
20457 Hamburg
Germany
|
1 |
Obligors
|
1.1 |
A copy of the constitutional documents of each Obligor.
|
1.2 |
A copy of a resolution of the manager of each Obligor:
|
(a) |
approving the terms of, and the transactions contemplated by, the Finance Documents to which it is a party and resolving that it execute the Finance Documents to which it is a party;
|
(b) |
authorising a specified person or persons to execute the Finance Documents to which it is a party on its behalf; and
|
(c) |
authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices (including, if relevant, the Utilisation Request and each Selection Notice) to be signed and/or despatched by it under, or in
connection with, the Finance Documents to which it is a party.
|
1.3 |
An original of the power of attorney of any Obligor authorising a specified person or persons to execute the Finance Documents to which it is a party.
|
1.4 |
A copy of a resolution signed by the Parent Guarantor as the owner of all of the Equity Interests of that Borrower, approving the terms of, and the transactions contemplated by, the Finance Documents to which the Borrower is a party.
|
1.5 |
A certificate of each Obligor (signed by a manager (or equivalent)) confirming that borrowing or guaranteeing, as appropriate, the Total Commitments would not cause any borrowing, guaranteeing or similar limit binding on that Obligor to be
exceeded.
|
1.7 |
A certificate of an authorised signatory of the relevant Obligor certifying that each copy document relating to it specified in this Part A of Schedule 2 (Conditions Precedent) is correct, complete
and in full force and effect as at a date no earlier than the date of this Agreement.
|
1.8 |
Written confirmation of the ultimate legal and beneficial ownership of each Borrower and the Parent Guarantor in a form approved by the Lenders, such ultimate legal and beneficial owner to be approved by the Lenders.
|
2 |
Finance Documents
|
2.1 |
A duly executed original of any Finance Document not otherwise referred to in this Schedule 2 (Conditions Precedent).
|
2.2 |
A duly executed original of any other document required to be delivered by each Finance Document if not otherwise referred to this Schedule 2 (Conditions Precedent).
|
3 |
Security
|
3.1 |
A duly executed original of the Account Security in relation to each Account.
|
4 |
Legal opinions
|
4.1 |
A legal opinion of Watson, Farley & Williams LLP, legal advisers to the Arranger, the Facility Agent and the Security Agent in England, substantially in the form distributed to the Original Lenders before signing this Agreement.
|
4.2 |
A legal opinion of Watson, Farley & Williams LLP, legal advisers to the Arranger, the Facility Agent and the Security Agent in the Marshall Islands, substantially in the form distributed to the Original Lenders before signing this
Agreement.
|
5 |
Other documents and evidence
|
5.1 |
Details of any financial covenants which any member of the Group may have in relation to any of their current vessel financings.
|
5.2 |
Evidence that any process agent referred to in Clause 48.2 (Service of process), if not an Obligor, has accepted its appointment.
|
5.3 |
Documentary evidence that the Borrowers are in the absolute and unencumbered ownership of the Parent Guarantor.
|
5.4 |
A copy of any other Authorisation or other document, opinion or assurance which the Facility Agent considers to be necessary (if it has notified the Borrowers accordingly) in connection with the entry into and performance of the
transactions contemplated by any Transaction Document or for the validity and enforceability of any Transaction Document.
|
5.5 |
The Original Financial Statements of the Parent Guarantor.
|
5.6 |
The original of any mandates or other documents required in connection with the opening or operation of the Accounts.
|
5.7 |
Evidence that the fees, costs and expenses then due from the Borrowers pursuant to Clause 11 (Fees) and Clause 16 (Costs and Expenses) have been paid or will
be paid by the Utilisation Date.
|
5.8 |
Such evidence as the Facility Agent may require for the Finance Parties to be able to satisfy each of their “know your customer” or similar identification procedures in relation to the transactions contemplated by the Finance Documents.
|
(a) |
“Relevant Borrower” means any Borrower which is utilising the its Tranche on the relevant Utilisation Date; and
|
(b) |
“Relevant Ship” means the Ship which is owned by the Relevant Borrower.
|
1 |
Borrowers
|
2 |
Ship and other security
|
2.1 |
A duly executed original of the Shares Security in respect of the Relevant Borrower (and of each document to be delivered under it).
|
2.2 |
A duly executed original of the Mortgage and the General and Charterparty Assignment in respect of the Relevant Ship and of each document to be delivered under or pursuant to each of them together with documentary evidence that the
Mortgage in respect of the Relevant Ship has been duly registered as a valid first preferred ship mortgage in accordance with the laws of the jurisdiction of its Approved Flag.
|
2.3 |
Documentary evidence that the Relevant Ship:
|
(a) |
is definitively and permanently registered in the name of the Relevant Borrower under the Approved Flag applicable to that Ship;
|
(b) |
is in the absolute and unencumbered ownership of the Relevant Borrower save as contemplated by the Finance Documents;
|
(c) |
maintains the Approved Classification with the Approved Classification Society free of all overdue recommendations and conditions of the Approved Classification Society; and
|
(d) |
is insured in accordance with the provisions of this Agreement and all requirements in this Agreement in respect of insurances have been complied with.
|
2.4 |
Documents establishing that the Relevant Ship will, as from the Utilisation Date of the Advance under the relevant Tranche, be managed by the Approved Managers on terms acceptable to the Facility Agent acting with the authorisation of all
of the Lenders, together with:
|
(a) |
a Manager’s Undertaking for each Approved Manager of the Relevant Ship; and
|
(b) |
copies of the relevant Approved Manager’s Document of Compliance and of the Relevant Ship’s Safety Management Certificate (together with any other details of the applicable Safety Management System which the Facility Agent requires) and of
any other documents required under the ISM Code and the ISPS Code in relation to the Relevant Ship including without limitation an ISSC.
|
2.5 |
An opinion from an independent insurance consultant acceptable to the Facility Agent on such matters relating to the Insurances as the Facility Agent may require.
|
2.6 |
Valuations of the Relevant Ship, addressed to the Facility Agent on behalf of the Finance Parties, stated to be for the purposes of this Agreement and dated not earlier than 30 days before the Utilisation Date for the Advance under the
relevant Tranche from an Approved Valuer which shows that upon Utilisation of the Advance under the relevant Tranche, the amount of the relevant Tranche will not exceed 40 per cent of the Fair Market Value for the Relevant Ship.
|
2.7 |
An inspection report satisfactory to the Facility Agent by an independent surveyor acceptable to, or instructed by, the Facility Agent following a physical inspection of the Relevant Ship. Costs for such inspection reports to be borne by
the Borrowers
|
3 |
Legal opinions
|
4 |
Other documents and evidence
|
4.1 |
Evidence that the fees, costs and expenses then due from the Borrowers pursuant to Clause 11 (Fees) and Clause 16 (Costs and Expenses) have been paid or will be paid by the Utilisation Date for the Advance.
|
From:
|
MULAN SHIPPING CO., JOHNNY BRAVO SHIPPING CO., SONGOKU SHIPPING CO., ASTERIX SHIPPING CO. and STEWIE SHIPPING CO.
|
To:
|
DEUTSCHE BANK AG
|
2 |
We wish to borrow the Advance under each Tranche on the following terms:
|
Proposed Utilisation Date:
|
[●] (or, if that is not a Business Day, the next Business Day)
|
Amount:
|
[●] or, if less, the Available Facility
|
Interest Period for the first Advance:
|
[●]
|
3 |
You are authorised and requested to deduct from the Advance prior to funds being remitted the following amounts set out against the following items:
|
Deductible Items
|
$
|
[Fees]
|
[●]
|
Net proceeds of Advance
|
4 |
We confirm that each condition specified in Clause 4.1 (Initial conditions precedent) and Clause 4.2 (Further conditions precedent) of this Agreement as they
relate to the Advance to which this Utilisation Request refers is satisfied on the date of this Utilisation Request.
|
5 |
The net proceeds of this Advance should be credited to [account].
|
6 |
This Utilisation Request is irrevocable.
|
[●]
|
||
authorised signatory for
|
||
MULAN SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
JOHNNY BRAVO SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
SONGOKU SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
ASTERIX SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
STEWIE SHIPPING CO.
|
From:
|
MULAN SHIPPING CO., JOHNNY BRAVO SHIPPING CO., SONGOKU SHIPPING CO., ASTERIX SHIPPING CO. and STEWIE SHIPPING CO.
|
To:
|
DEUTSCHE BANK AG
|
1 |
We refer to the Agreement. This is a Selection Notice. Terms defined in the Agreement have the same meaning in this Selection Notice unless given a different meaning in this Selection Notice.
|
2 |
We request that the next Interest Period for the Loan be [●].
|
3 |
This Selection Notice is irrevocable.
|
[●]
|
||
authorised signatory for
|
||
MULAN SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
JOHNNY BRAVO SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
SONGOKU SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
ASTERIX SHIPPING CO.
|
||
[●]
|
||
authorised signatory for
|
||
STEWIE SHIPPING CO.
|
To:
|
DEUTSCHE BANK AG as Facility Agent
|
From:
|
[The Existing Lender] (the “Existing Lender”) and [The New Lender] (the “New Lender”)
|
1 |
We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement have the same meaning in this Transfer Certificate unless given a different meaning in this Transfer Certificate.
|
2 |
We refer to Clause 28.5 (Procedure for transfer) of the Agreement:
|
(a) |
The Existing Lender and the New Lender agree to the Existing Lender transferring to the New Lender by novation all of the Existing Lender’s rights and obligations under the Agreement and the other Finance Documents which relate to that
portion of the Existing Lender’s Commitment and participation in the Loan under the Agreement as specified in the Schedule in accordance with Clause 28.5 (Procedure for transfer) of the Agreement.
|
(b) |
The proposed Transfer Date is [●].
|
(c) |
The Facility Office and address, fax number and attention details for notices of the New Lender for the purposes of Clause 37.2 (Addresses) of the Agreement are set out in the Schedule.
|
4 |
This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate.
|
5 |
This Transfer Certificate and any non-contractual obligations arising out of or in connection with it are is governed by English law.
|
6 |
This Transfer Certificate has been entered into on the date stated at the beginning of this Transfer Certificate.
|
[Existing Lender]
|
[New Lender]
|
By: [●]
|
By: [●]
|
To: |
[●] as Facility Agent and MULAN SHIPPING CO., JOHNNY BRAVO SHIPPING CO., SONGOKU SHIPPING CO., ASTERIX SHIPPING CO. and STEWIE SHIPPING CO. as Borrowers, for and on behalf of each [Transaction]
Obligor
|
From:
|
[the Existing Lender] (the “Existing Lender”) and [the New Lender] (the “New Lender”)
|
1 |
We refer to the Agreement. This is an Assignment Agreement. Terms defined in the Agreement have the same meaning in this Assignment Agreement unless given a different meaning in this Assignment Agreement.
|
2 |
We refer to Clause 28.6 (Procedure for assignment):
|
(a) |
The Existing Lender assigns absolutely to the New Lender all the rights of the Existing Lender under the Agreement, the other Finance Documents and in respect of the Transaction Security which correspond to that portion of the Existing
Lender’s Commitment and participations in the Loan under the Agreement as specified in the Schedule.
|
(c) |
The New Lender becomes a Party as a Lender and is bound by obligations equivalent to those from which the Existing Lender is released under paragraph (b) above.
|
(d) |
All rights and interests (present, future or contingent) which the Existing Lender has under or by virtue of the Finance Documents are assigned to the New Lender absolutely, free of any defects in the Existing Lender’s title and of any
rights or equities which the Borrowers or any other [Transaction] Obligor had against the Existing Lender.
|
3 |
The proposed Transfer Date is [●].
|
4 |
On the Transfer Date the New Lender becomes Party to the Finance Documents as a Lender.
|
5 |
The Facility Office and address, fax, number and attention details for notices of the New Lender for the purposes of Clause 37.2 (Addresses) are set out in the Schedule.
|
6 |
The New Lender expressly acknowledges the limitations on the Existing Lender’s obligations set out in paragraph (c) of Clause 28.4 (Limitation of responsibility of Existing Lenders).
|
7 |
This Assignment Agreement acts as notice to the Facility Agent (on behalf of each Finance Party) and, upon delivery in accordance with Clause 28.7 (Copy of Transfer Certificate or Assignment Agreement to
Borrowers), to the Borrowers (on behalf of each [Transaction] Obligor) of the assignment referred to in this Assignment Agreement.
|
8 |
This Assignment Agreement may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Assignment Agreement.
|
9 |
This Assignment Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.
|
10 |
This Assignment Agreement has been entered into on the date stated at the beginning of this Assignment Agreement.
|
[Existing Lender]
|
[New Lender]
|
By: [●]
|
By: [●]
|
To:
|
DEUTSCHE BANK AG as Facility Agent
|
From:
|
CASTOR MARITIME INC.
|
1 |
We refer to the Agreement. This is a Compliance Certificate. Terms defined in the Agreement have the same meaning when used in this Compliance Certificate unless given a different meaning in this Compliance Certificate.
|
2 |
We confirm that:
|
(a) |
the Interest Cover Ratio is no less than 3 to 1;
|
(b) |
the Parent Guarantor’s Value Adjusted Net Leverage Ratio is not more than 0.65 to 1;
|
(c) |
the Parent Guarantor maintains at least [$20,000,000 in unencumbered cash that is freely available] or [[●] being 10 per cent. of the consolidated debt balance sheet of the Parent Guarantor and its
Subsidiaries, plus the aggregate Pledged Liquidity, in each case evidenced either as a credit balance in the Parent Guarantor’s bank statement or as a cash item on the consolidated balance sheet of the Parent Guarantor and its Subsidiaries];
and
|
3 |
We confirm that no Default is continuing.
|
Signed:
|
||
Chief Financial Officer
|
||
of
|
||
CASTOR MARITIME INC.
|
Delivery of a duly completed Utilisation Request (Clause 5.1 (Delivery of the Utilisation Request)) or a Selection Notice (Clause 9.1 (Interest Periods))
|
Three Business Days before the intended Utilisation Date (Clause 5.1 (Delivery of the Utilisation Request)) or the expiry of the preceding Interest Period (Clause 9.1
(Interest Period)) or such shorter period as the Facility Agent agrees.
|
|
Facility Agent notifies the Lenders of the Advance in accordance with Clause 5.4 (Lenders’ participation)
|
Three Business Days before the intended Utilisation Date or such shorter period as the Facility Agent agrees.
|
|
Reference Rate is fixed
TERM SOFR Reference Rate is fixed
|
Quotation Day as of 11:00 am London time
Quotation Day as of approximately 5:00 a.m., Chicago time
|
Total Commitments
(USD)
|
Tranche A (USD)
|
Tranche B (USD)
|
Tranche C (USD)
|
Tranche D (USD)
|
Tranche E (USD)
|
||||||||
Drawdown amount
|
55,000,000.00
|
12,150,000.00
|
11,700,000.00
|
11,200,000.00
|
11,700,000.00
|
8,250,000.00
|
|||||||
1st Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
2nd Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
3rd Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
4th Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
5th Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
6th Quarterly repayment
|
3,535,000.00
|
780,913.64
|
751,990.91
|
719,854.55
|
751,990.91
|
530,250.00
|
|||||||
7th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
|||||||
8th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
9th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
|||||||
10th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
|||||||
11th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
|||||||
12th Quarterly repayment
|
1,750,000.00
|
386,590.91
|
372,272.73
|
356,363.64
|
372,272.73
|
262,500.00
|
|||||||
13th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
14th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
15th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
16th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
17th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
18th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
19th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
20th Quarterly repayment
|
1,340,000.00
|
296,018.18
|
285,054.55
|
272,872.73
|
285,054.55
|
201,000.00
|
|||||||
Balloon payable together with 20th Quarterly repayment
|
12,570,000.00
|
2,776,827.27
|
2,673,981.82
|
2,559,709.09
|
2,673,981.82
|
1,885,500.00
|
BORROWERS
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
MULAN SHIPPING CO.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
JOHNNY BRAVO SHIPPING CO.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
SONGOKU SHIPPING CO.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
ASTERIX SHIPPING CO.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
STEWIE SHIPPING CO.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
PARENT GUARANTOR
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
CASTOR MARITIME INC.
|
)
|
its:
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
ORIGINAL LENDERS
|
|
SIGNED by
|
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
DEUTSCHE BANK AG
|
)
|
)
|
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
ARRANGER
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
DEUTSCHE BANK AG
|
)
|
)
|
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
FACILITY AGENT
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
DEUTSCHE BANK AG
|
)
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
SECURITY AGENT
|
|
SIGNED by
|
)
|
)
|
|
duly authorised
|
)
|
for and on behalf of
|
)
|
DEUTSCHE BANK AG
|
)
|
)
|
|
in the presence of:
|
)
|
Witness’ signature:
|
)
|
Witness’ name:
|
)
|
Witness’ address:
|
)
|
Subsidiary
|
Vessel
|
Jurisdiction
|
Spetses Shipping Co.
|
Magic P
|
Marshall Islands
|
Bistro Maritime Co.
|
Magic Sun
|
Marshall Islands
|
Pikachu Shipping Co.
|
Magic Moon
|
Marshall Islands
|
Bagheera Shipping Co.
|
Magic Rainbow
|
Marshall Islands
|
Pocahontas Shipping Co.
|
Magic Horizon
|
Marshall Islands
|
Jumaru Shipping Co.
|
Magic Nova
|
Marshall Islands
|
Pumba Shipping Co.
|
Magic Orion
|
Marshall Islands
|
Super Mario Shipping Co.
|
Magic Venus
|
Marshall Islands
|
Kabamaru Shipping Co.
|
Magic Argo
|
Marshall Islands
|
Gamora Shipping Co.
|
Wonder Sirius
|
Marshall Islands
|
Rocket Shipping Co.
|
Wonder Polaris
|
Marshall Islands
|
Luffy Shipping Co.
|
Magic Twilight
|
Marshall Islands
|
Snoopy Shipping Co.
|
Magic Nebula
|
Marshall Islands
|
Liono Shipping Co.
|
Magic Thunder
|
Marshall Islands
|
Cinderella Shipping Co.
|
Magic Eclipse
|
Marshall Islands
|
Mulan Shipping Co.
|
Magic Starlight
|
Marshall Islands
|
Starlord Shipping Co.
|
Wonder Vega
|
Marshall Islands
|
Asterix Shipping Co.
|
Magic Perseus
|
Marshall Islands
|
Songoku Shipping Co.
|
Magic Pluto
|
Marshall Islands
|
Stewie Shipping Co.
|
Magic Vela
|
Marshall Islands
|
Johnny Bravo Shipping Co.
|
Magic Mars
|
Marshall Islands
|
Elektra Shipping Co.
|
Wonder Arcturus
|
Marshall Islands
|
Vision Shipping Co.
|
Wonder Mimosa
|
Marshall Islands
|
Colossus Shipping Co.
|
Wonder Musica
|
Marshall Islands
|
Xavier Shipping Co.
|
Wonder Formosa
|
Marshall Islands
|
Hawkeye Shipping Co.
|
Wonder Avior
|
Marshall Islands
|
Garfield Shipping Co.
|
Magic Phoenix
|
Marshall Islands
|
Drax Shipping Co.
|
Wonder Bellatrix
|
Marshall Islands
|
Mickey Shipping Co.
|
Magic Callisto
|
Marshall Islands
|
Castor Maritime SCR Corp.
|
N/A
|
Marshall Islands
|
1) |
I have reviewed this annual report on Form 20-F of Castor Maritime Inc. (the “Company”);
|
2) |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
|
3) |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of
the Company as of, and for, the periods presented in this report;
|
4) |
The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely
to materially affect, the Company’s internal control over financial reporting; and
|
5) |
The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s
Board of Directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record,
process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.
|
Date: March 31, 2022
|
By:
|
/s/ Petros Panagiotidis
|
|
Name:
|
Petros Panagiotidis
|
||
Title:
|
Chairman, Chief Executive Officer and
Chief Financial Officer
|
Date: March 31, 2022
|
By:
|
/s/ Petros Panagiotidis
|
|
Name:
|
Petros Panagiotidis
|
||
Title:
|
Chairman, Chief Executive Officer and
Chief Financial Officer
|