As filed with the Securities and Exchange Commission on May 14, 2018

 

 

Registration No. 333-224313

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 


 Amendment No. 1 to

FORM S-3

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

 

 

 

INTERNATIONAL SEAWAYS, INC.

(Exact name of registrant as specified in its charter)

 

Marshall Islands
(State or other jurisdiction of

incorporation or organization)

4412
(Primary Standard Industrial
Classification Code Number)
98-0467117
(I.R.S. Employer
Identification No.)
     
 

600 Third Avenue, 39 th Floor

New York, New York 10016

(212) 578-1600

 
(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive offices)

 

 

 

James D. Small III, Esq.

Chief Administrative Officer, Senior Vice President,

Secretary and General Counsel

600 Third Avenue, 39 th Floor, New York, New York 10016

(212) 578-1600

(Name, address, including zip code, and telephone number,
including area code, of agent for service)

 

 

 

(Copies of all communications, including communications sent to agent for service)

Jeffrey D. Karpf, Esq.

Cleary Gottlieb Steen & Hamilton LLP
One Liberty Plaza
New York, New York 10006
(212) 225-2000

 

 

 

Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.

 

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ¨

 

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. x

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.        ¨

 

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ¨

 

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ¨

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ¨     Accelerated filer x
Non-accelerated filer ¨     Smaller reporting company ¨
      Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. x

 

CALCULATION OF REGISTRATION FEE

 

Title of Each Class of
Securities to be Registered (1)
 

Amount to be
Registered

(2)(3)

  Proposed Maximum
Offering Price
Per Security (2)(4)
  Proposed Maximum
Aggregate
Offering Price (2)(4)
  Amount of
Registration
Fee (5)
Senior and Subordinated Debt Securities  

  $        —   $   $
Preferred Stock, no par value   $   $   $
Total    —   $   $ 100,000,000   $ 12,450.00

 

  (1) Securities registered hereunder may be sold separately, or together with other securities registered hereunder. The securities registered hereunder also include such indeterminate number of shares of preferred stock and amount of debt securities as may be issued upon conversion of or exchange for preferred stock or debt securities that provide for conversion or exchange or pursuant to the antidilution provisions of any of such securities.
     
  (2) Not specified as to each class of securities to be registered pursuant to Form S-3 General Instruction II.D.
     
  (3) The Registrant is registering an indeterminate aggregate principal amount and number of securities of each identified class of securities up to a proposed aggregate offering price of $100,000,000, which may be offered from time to time in unspecified numbers and at indeterminate prices, and as may be issuable upon conversion, redemption, repurchase, exchange or exercise of any securities registered hereunder, including under any applicable anti-dilution provisions.
     
  (4) With respect to debt securities, exclusive of accrued interest and amortization of discount, if any, to the date of delivery.
     
  (5) Previously paid. Estimated solely for the purpose of computing the registration fee. Calculated pursuant to Rule 457(o) of the rules and regulations under the Securities Act. Rule 457(o) permits the registration statement fee to be calculated on the basis of the maximum offering price of all of the securities listed above, and, therefore, the table does not specify by each class of security information as to the amount to be registered or the proposed maximum offering price per security.

 

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

 

 

 

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission relating to these securities is effective. This preliminary prospectus is not an offer to sell these securities and it is not a solicitation of an offer to buy these securities in any jurisdiction where such offer, solicitation or sale is not permitted.

 

SUBJECT TO COMPLETION, DATED May 14, 2018

 

PROSPECTUS

 

International Seaways, Inc.

 

Debt Securities and Preferred Stock

 

 

   

We may offer from time to time preferred stock or debt securities having an aggregate public offering price not to exceed $100 million, or the equivalent thereof in one or more foreign currencies. We may offer such securities separately or together, in one or more series or classes and in amounts, at prices and on terms to be determined at the time of sale.

 

We will provide the specific terms of any offering of the securities in supplements to this prospectus.

 

This prospectus describes some of the general terms that may apply to these securities. We will provide the specific terms of any securities in a supplement or supplements to this prospectus. You should read this prospectus, any prospectus supplement and the risk factors incorporated by reference herein or included in any prospectus supplement carefully before you invest in our securities.

 

If we decide to seek a listing of any debt securities or preferred stock offered by this prospectus, the related prospectus supplement will disclose the exchange or market on which the securities will be listed, if any, or where we have made an application for listing, if any. Our common stock is listed on the New York Stock Exchange under the symbol “INSW.”

 

This prospectus may not be used to sell securities unless accompanied by a prospectus supplement or other offering materials.

 

Investing in our securities involves a high degree of risk. You should consider carefully the risks and uncertainties in the section entitled “Risk Factors” beginning on page 2 of this prospectus and, if applicable, in the documents we file with the Securities and Exchange Commission and as set forth in any applicable prospectus supplement before investing in our securities.

 

We may offer securities through underwriting syndicates managed or co-managed by one or more underwriters or dealers, through agents or directly to purchasers. The prospectus supplement for each offering of securities will describe in detail the plan of distribution for that offering. For general information about the distribution of securities offered, please see “Plan of Distribution” in this prospectus.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

 

 

 

The date of this prospectus is May [___], 2018.

 

 

 

 

TABLE OF CONTENTS

 

ABOUT THIS PROSPECTUS ii
PROSPECTUS SUMMARY 1
RISK FACTORS 2
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 2
RATIO OF EARNINGS TO FIXED CHARGES 5
USE OF PROCEEDS 5
DESCRIPTION OF SECURITIES 6
DESCRIPTION OF DEBT SECURITIES 6
DESCRIPTION OF PREFERRED STOCK 15
DESCRIPTION OF CAPITAL STOCK 18
PLAN OF DISTRIBUTION 22
LEGAL MATTERS 23
EXPERTS 23
WHERE YOU CAN FIND MORE INFORMATION 23
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 24

 

  i  

 

 

ABOUT THIS PROSPECTUS

 

This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission (the “SEC”) using a “shelf” registration process. Under this shelf registration process, we may, from time to time, sell any combination of the securities described in this prospectus in one or more offerings, up to a maximum aggregate offering price of $100 million, or the equivalent thereof in one or more foreign currencies.

 

This prospectus only provides you with a general description of the securities that may be offered. Each time we sell securities using this shelf registration, we will provide a supplement or supplements to this prospectus that will contain specific information about the terms of that offering, including the specific amounts, prices and terms of the securities offered. Any prospectus supplement may also add, update or change information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any applicable prospectus supplement, you should rely on the information in the applicable prospectus supplement. You should read in their entirety both this prospectus and any accompanying prospectus supplement, together with the additional information described under the sections entitled “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference” before deciding to invest in any of the securities being offered.

 

You should not assume that the information in this prospectus, any accompanying prospectus supplement or any document incorporated by reference herein is accurate as of any date other than the date on the front of each document, regardless of the time of delivery of this prospectus, any accompanying prospectus supplement or any sale of securities. Our business, financial condition, results of operations and prospects may have changed since such date. Neither the delivery of this prospectus nor any sale made under it implies that there has been no change in our affairs or that the information in this prospectus is correct as of any date after the date of this prospectus.

 

You should rely only on the information contained in or incorporated by reference in this prospectus, in any accompanying prospectus supplement or in any free writing prospectus filed by us with the SEC. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted

 

In this prospectus, unless otherwise specified or the context otherwise requires, we use the terms “the Company,” “INSW,” “we,” “our” and “us” to refer to International Seaways, Inc., a Marshall Islands corporation, and its consolidated subsidiaries. References to “International Seaways, Inc.” refer only to International Seaways, Inc. on an unconsolidated basis, except where the context may require otherwise.

 

  ii  

 

 

PROSPECTUS SUMMARY

 

This summary highlights information contained elsewhere in, or incorporated by reference into, this prospectus. As a result, it may not contain all the information that may be important to you in, or that you should consider before making a decision as to whether or not to invest in our securities, and is qualified in its entirety by the more detailed information included in and incorporated by reference into this prospectus. You should read the entire prospectus carefully, including the section entitled “Risk Factors” and the documents incorporated by reference herein, which are described under “Incorporation of Certain Documents by Reference,” before making an investment decision. For a more complete description of our business as of the date of this prospectus, see the “Business” section of our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on March 12, 2018 (Commission File No. 001-37836) (the “Form 10-K”), which is incorporated by reference herein.

 

A glossary of shipping terms that should be used as a reference when reading this prospectus and the documents incorporated by reference herein can be found in the Form 10-K.

 

Our Company

 

We are a leading provider of ocean transportation services for crude oil and refined petroleum products. We own or operate a fleet of more than 50 vessels, all of which operate in International Flag markets. We serve a diverse group of customers, including major independent and state-owned oil companies, oil traders and refinery operators, and have a reputation in the industry for excellent service.

 

Our vessel operations are organized into two segments: Crude Tankers and Product Carriers. Our fleet consists of ULCC, VLCC, Aframax and Panamax crude tankers, as well as LR1, LR2 and MR product carriers, and includes vessels owned by two joint ventures (the “JVs”) through which we have ownership interests in four liquefied natural gas (“LNG”) carriers and two floating storage and offloading (“FSO”) service vessels.

 

INSW generally charters its vessels to customers either for specific voyages at spot rates or for specific periods of time at fixed daily amounts through time charters or bareboat charters. Spot market rates are highly volatile, while time charter and bareboat charter rates provide more predictable streams of time charter equivalent (“TCE”) revenues because they are fixed for specific periods of time. Shipping revenues from our fleet, derived primarily through spot market voyage charters, were $290 million during 2017, while TCE revenues (Shipping revenues less Voyage expenses) were $275 million for that period.

 

Company Inf o rmation

 

Our executive offices are located at 600 Third Avenue, 39 th Floor, New York, New York 10016, and our telephone number is (212) 578-1600. Our Internet website address is www.intlseas.com . Information on, or accessible through, our website is not incorporated into, nor should it be considered part of, this prospectus or any applicable prospectus supplement, except as and solely to the extent otherwise provided herein or therein. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website.

 

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RISK FACTORS

 

An investment in our securities involves a high degree of risk. You should carefully consider the specific risks described under the heading “Risk Factors” in any applicable prospectus supplement and in the documents incorporated by reference into this prospectus, including our most recent Annual Report on Form 10-K, and in each of our subsequent Quarterly Reports on Form 10-Q. before making an investment decision. If any of the risks described in these documents actually materializes, our business, financial condition, results of operations and prospects could be materially adversely affected. As a result, the value of our securities could decline and you could lose part or all of your investment. The risks described below are not the only ones we face. There may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that could have material adverse effects on our future results. Past financial performance may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods.

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

Some of the statements contained in this prospectus and the documents incorporated by reference herein constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All such statements other than statements of historical facts should be considered forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts, and you can often identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “target,” “projects,” “forecasts,” “shall,” “contemplates” or the negative version of those words or other comparable words. Such forward-looking statements represent our reasonable expectation with respect to future events or circumstances based on various factors and are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors, many of which are beyond our control, that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statements and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under “Risk Factors,” when reviewing such statement. We believe that these factors include, but are not limited to: 

 

  · the highly cyclical nature of INSW’s industry
     
  · fluctuations in the market value of vessels;
     
  · declines in charter rates, including spot charter rates or other market deterioration;
     
  · an increase in the supply of vessels without a commensurate increase in demand;
     
  · the impact of adverse weather and natural disasters;
     
  · the adequacy of INSW’s insurance to cover its losses, including in connection with maritime accidents or spill events;
     
  · constraints on capital availability;
     
  · changing economic, political and governmental conditions in the United States and/or abroad and general conditions in the oil and natural gas industry;
     
  · changes in fuel prices;
     
  · acts of piracy on ocean-going vessels;
     
  · terrorist attacks and international hostilities and instability;

 

  2  

 

 

  · the impact of public health threats and outbreaks of highly communicable diseases;
     
  · the effect of the Company’s indebtedness on its ability to finance operations, pursue desirable business operations and successfully run its business in the future;
     
  · the Company’s ability to generate sufficient cash to service its indebtedness and to comply with debt covenants;
     
  · the Company’s ability to make additional capital expenditures to expand the number of vessels in its fleet, and to maintain all of its vessels and to comply with existing and new regulatory standards;
     
  · the availability and cost of third party service providers for technical and commercial management of the Company’s fleet;
     
  · fluctuations in the contributions of the Company’s joint ventures to its profits and losses;
     
  · the Company’s ability to renew its time charters when they expire or to enter into new time charters;
     
  · termination or change in the nature of the Company’s relationship with any of the commercial pools in which it participates and the ability of such commercial pools to pursue a profitable chartering strategy;
     
  · competition within the Company’s industry and INSW’s ability to compete effectively for charters with companies with greater resources;
     
  · the loss of a large customer or significant business relationship;
     
  · the Company’s ability to realize benefits from its past acquisitions or acquisitions or other strategic transactions it may make in the future;
     
  · increasing operating costs and capital expenses as the Company’s vessels age, including increases due to limited shipbuilder warranties or the consolidation of suppliers;
     
  · the Company’s ability to replace its operating leases on favorable terms, or at all;
     
  · changes in credit risk with respect to the Company’s counterparties on contracts;
     
  · the failure of contract counterparties to meet their obligations;
     
  · the Company’s ability to attract, retain and motivate key employees;
     
  · work stoppages or other labor disruptions by employees of INSW or other companies in related industries;
     
  · unexpected drydock costs;
     
  · the potential for technological innovation to reduce the value of the Company’s vessels and charter income derived therefrom;
     
  · the impact of an interruption in or failure of the Company’s information technology and communication systems upon the Company’s ability to operate;
     
  · seasonal variations in INSW’s revenues;

 

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  · government requisition of the Company’s vessels during a period of war or emergency;
     
  · the Company’s compliance with complex laws, regulations and in particular, environmental laws and regulations, including those relating to the emission of greenhouse gases and ballast water treatment;
     
  · any non-compliance with the U.S. Foreign Corrupt Practices Act of 1977 or other applicable regulations relating to bribery or corruption;
     
  · the impact of litigation, government inquiries and investigations;
     
  · governmental claims against the Company;
     
  · the arrest of INSW’s vessels by maritime claimants;
     
  · changes in laws, treaties or regulations; and
     
  · the impact that Brexit might have on global trading parties.

 

The factors identified above should not be construed as exhaustive list of factors that could affect our future results, and should be read in conjunction with the other cautionary statements that are included elsewhere in this prospectus. The forward-looking statements made in this prospectus are made only as of the date of this prospectus. The forward-looking statements made in documents incorporated by reference into this prospectus are made only as of the date of such documents. The forward-looking statements made in any accompanying prospectus supplement are made only as of the date of such document. We do not undertake any obligation to publicly update or review any forward-looking statement except as required by law, whether as a result of new information, future developments or otherwise. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.

 

If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. You should specifically consider the factors identified in this prospectus that could cause actual results to differ before making an investment decision to purchase our common stock. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.

 

You should refer to our periodic and current reports filed with the SEC for further information on other factors that could cause actual results to be significantly different from those expressed or implied by these forward-looking statements. See “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference” in this prospectus.

 

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RATIO OF EARNINGS TO FIXED CHARGES

 

The following table sets forth our ratio of earnings to fixed charges for each of the periods indicated (dollars in thousands).

 

    Three months ended     Year ended December 31,  
    March 31, 2018     2017     2016     2015     2014     2013  
Ratio of Earnings to Fixed Charges     -       -       -       4.39       -       -  
Deficiency of Earnings to Fixed Charges   $ 28,733     $ 113,321     $ 15,699             $ 119,782     $ 751,248  

 

For purposes of calculating this ratio, earnings consist of income (loss) before income taxes, plus fixed charges, less amortization of   capitalized interest. Fixed charges include interest expense and the portion of rent expense representative of the interest factor.

 

Our ratio of earnings to combined fixed charges and preferred stock dividends for each of the periods indicated has been the same as the ratio of earnings to fixed charges for each such period because we have not had any shares of preferred stock outstanding during the last five years and have, therefore, not paid any dividends on preferred stock.

 

USE OF PROCEEDS

 

Unless otherwise indicated in an accompanying prospectus supplement, we will use the net proceeds from the sale of securities covered by this prospectus for general corporate purposes, which may include working capital needs, repayment of indebtedness, capital expenditures, funding of our subsidiaries and acquisitions. The intended application of proceeds from the sale of any particular offering of securities using this prospectus will be described in the accompanying prospectus supplement relating to such offering. The precise amount and timing of the application of these proceeds will depend on our funding requirements and the availability and costs of other funds.

 

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DESCRIPTION OF SECURITIES

 

This prospectus contains summary descriptions of debt securities and preferred stock that we may sell from time to time. These summary descriptions are not meant to be complete descriptions of each security. However, this prospectus and the applicable prospectus supplement contain the material terms of the securities being offered.

 

DESCRIPTION OF DEBT SECURITIES

 

As used in this prospectus, debt securities means the debentures, notes, bonds and other evidences of indebtedness that International Seaways, Inc. may issue from time to time. Debt securities offered by this prospectus will be either senior debt securities or subordinated debt securities. Senior debt securities will be issued under a “Senior Indenture” to be entered into later and subordinated debt securities will be issued under a “Subordinated Indenture” to be entered into later. This prospectus sometimes refers to the Senior Indenture and the Subordinated Indenture collectively as the “Indentures.” Unless the applicable prospectus supplement states otherwise, the trustee under each of the Senior Indenture and the Subordinated Indenture will be The Bank of New York Mellon.

 

The form of Senior Indenture and the form of the Subordinated Indenture are filed as exhibits to the registration statement. The statements and descriptions in this prospectus or in any prospectus supplement regarding provisions of the Indentures and debt securities are summaries thereof, do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all of the provisions of the Indentures and debt securities, including the definitions therein of certain terms.

 

General

 

Debt securities will be direct unsecured obligations of International Seaways, Inc. Senior debt securities will rank equally with all of International Seaways, Inc.’s other senior and unsubordinated debt. The subordinated debt securities will be subordinate and junior in right of payment to all of International Seaways, Inc.’s present and future senior indebtedness.

 

Because International Seaways, Inc. is principally a holding company, its right to participate in any distribution of assets of any subsidiary, upon the subsidiary’s liquidation or reorganization or otherwise, is subject to the prior claims of creditors of the subsidiary, except to the extent International Seaways, Inc. may be recognized as a creditor of that subsidiary. Accordingly, International Seaways, Inc.’s obligations under debt securities will be structurally subordinated to all existing and future indebtedness and liabilities of its subsidiaries, and holders of debt securities should look only to International Seaways, Inc.’s assets for payment thereunder.

 

The Indentures do not limit the aggregate principal amount of debt securities that International Seaways, Inc. may issue and provide that International Seaways, Inc. may issue debt securities from time to time in one or more series, in each case with the same or various maturities, at par or at a discount. International Seaways, Inc. may issue additional debt securities of a particular series without the consent of the holders of debt securities of such series outstanding at the time of the issuance. Any such additional debt securities, together with all other outstanding debt securities of that series, will constitute a single series of debt securities under the applicable Indenture. The Indentures also do not limit our ability to incur other debt, except as described under “Restrictive Covenants” herein.

 

Each prospectus supplement will describe the terms relating to the specific series of debt securities being offered. These terms will include some or all of the following:

 

· the title of the series and whether they are subordinated debt securities or senior debt securities;

 

· any limit on the aggregate principal amount of such debt securities;

 

· the price or prices at which International Seaways, Inc. will sell such debt securities;

 

· the maturity date or dates of such debt securities;

 

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· the rate or rates of interest, if any, which may be fixed or variable, at which such debt securities will bear interest, or the method of determining such rate or rates, if any;

 

· the date or dates from which any interest will accrue or the method by which such date or dates will be determined;

 

· the right, if any, to extend the interest payment periods and the duration of any such deferral period, including the maximum consecutive period during which interest payment periods may be extended;

 

· whether the amount of payments of principal of (and premium, if any) or interest on such debt securities may be determined with reference to any index, formula or other method, such as one or more currencies, commodities, equity indices or other indices, and the manner of determining the amount of such payments;

 

· the dates on which International Seaways, Inc. will pay interest on such debt securities and the regular record date for determining who is entitled to the interest payable on any interest payment date;

 

· whether the debt securities will be secured or unsecured;

 

· the place or places where the principal of (and premium, if any) and interest on such debt securities will be payable;

 

· if International Seaways, Inc. possesses the option to do so, the periods within which and the prices at which International Seaways, Inc. may redeem such debt securities, in whole or in part, pursuant to optional redemption provisions, and the other terms and conditions of any such provisions;

 

· International Seaways, Inc.’s obligation, if any, to redeem, repay or purchase such debt securities by making periodic payments to a sinking fund or through an analogous provision or at the option of holders of the debt securities, and the period or periods within which and the price or prices at which International Seaways, Inc. will redeem, repay or purchase such debt securities, in whole or in part, pursuant to such obligation, and the other terms and conditions of such obligation;

 

· the denominations in which such debt securities will be issued, if other than denominations of $1,000 and integral multiples of $1,000;

 

· the portion, or methods of determining the portion, of the principal amount of such debt securities which International Seaways, Inc. must pay upon the acceleration of the maturity of the debt securities in connection with an Event of Default (as described below), if other than the full principal amount;

 

· the currency, currencies or currency unit in which International Seaways, Inc. will pay the principal of (and premium, if any) or interest, if any, on such debt securities, if not United States dollars;

 

· provisions, if any, granting special rights to holders of such debt securities upon the occurrence of specified events;

 

· any deletions from, modifications of or additions to the Events of Default or International Seaways, Inc.’s covenants with respect to the applicable series of debt securities, and whether or not such Events of Default or covenants are consistent with those contained in the applicable Indenture;

 

· the application, if any, of the terms of the Indentures relating to defeasance and covenant defeasance (which terms are described below) to such debt securities;

 

· whether the subordination provisions summarized below or different subordination provisions will apply to such debt securities;

 

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· the terms, if any, upon which the holders may convert or exchange such debt securities into or for International Seaways, Inc.’s preferred stock or other debt securities;

 

· whether any of such debt securities will be issued in global form and, if so, the terms and conditions upon which global debt securities may be exchanged for certificated debt securities;

 

· any change in the right of the trustee or the requisite holders of such debt securities to declare the principal amount thereof due and payable because of an Event of Default;

 

· the depositary for global or certificated debt securities;

 

· any special tax implications of such debt securities;

 

· any trustees, authenticating or paying agents, transfer agents or registrars or other agents with respect to such debt securities; and

 

· any other terms of such debt securities.

 

Unless otherwise specified in the applicable prospectus supplement, debt securities will be issued in fully-registered form without coupons.

 

Unless otherwise specified in the applicable prospectus supplement, debt securities will not be listed on any securities exchange.

 

Debt securities may be sold at a substantial discount below their stated principal amount, bearing no interest or interest at a rate which at the time of issuance is below market rates. The applicable prospectus supplement will describe the federal income tax consequences and special considerations applicable to any such debt securities. Debt securities may also be issued as indexed securities or securities denominated in foreign currencies, currency units or composite currencies, as described in more detail in the prospectus supplement relating to any of the particular debt securities. The prospectus supplement relating to specific debt securities will also describe any special considerations and certain additional tax considerations applicable to such debt securities.

 

Subordination

 

The prospectus supplement relating to any offering of subordinated debt securities will describe the specific subordination provisions. However, unless otherwise noted in the applicable prospectus supplement, subordinated debt securities will be subordinate and junior in right of payment to all of International Seaways, Inc.’s Senior Indebtedness, to the extent and in the manner set forth in the Subordinated Indenture.

 

Under the Subordinated Indenture, “Senior Indebtedness” means all obligations of International Seaways, Inc. in respect of any of the following, whether outstanding at the date of execution of the Subordinated Indenture or thereafter incurred or created:

 

· the principal of (and premium, if any) and interest due on indebtedness of International Seaways, Inc. for borrowed money;

 

· all obligations guaranteed by International Seaways, Inc. for the repayment of borrowed money, whether or not evidenced by bonds, debentures, notes or other written instruments;

 

· all obligations guaranteed by International Seaways, Inc. evidenced by bonds, debentures, notes or similar written instruments, including obligations assumed or incurred in connection with the acquisition of property, assets or businesses (provided, however, that the deferred purchase price of any other business or property or assets shall not be considered indebtedness if the purchase price thereof is payable in full within 90 days from the date on which such indebtedness was created);

 

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· any obligations of International Seaways, Inc. as lessee under leases required to be capitalized on the balance sheet of the lessee under generally accepted accounting principles;

 

· all obligations of International Seaways, Inc. for the reimbursement on any letter of credit, banker’s acceptance, security purchase facility or similar credit transaction;

 

· all obligations of International Seaways, Inc. in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts and other similar agreements;

 

· all obligations of the types referred to above of other persons for the payment of which International Seaways, Inc. is responsible or liable as obligor, guarantor or otherwise; and

 

· all obligations of the types referred to above of other persons secured by any lien on any property or asset of International Seaways, Inc. (whether or not such obligation is assumed by International Seaways, Inc.).

 

Senior Indebtedness does not include:

 

· indebtedness or monetary obligations to trade creditors created or assumed by International Seaways, Inc. in the ordinary course of business in connection with the obtaining of materials or services;

 

· indebtedness that is by its terms subordinated to or ranks equal with the subordinated debt securities; and

 

· any indebtedness of International Seaways, Inc. to its affiliates (including all debt securities and guarantees in respect of those debt securities issued to any trust, partnership or other entity affiliated with International Seaways, Inc. that is a financing vehicle of International Seaways, Inc. in connection with the issuance by such financing entity of preferred securities or other securities guaranteed by International Seaways, Inc.) unless otherwise expressly provided in the terms of any such indebtedness.

 

Senior Indebtedness shall continue to be Senior Indebtedness and be entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any term of such Senior Indebtedness.

 

Unless otherwise noted in the accompanying prospectus supplement, if International Seaways, Inc. defaults in the payment of any principal of (or premium, if any) or interest on any Senior Indebtedness when it becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise, then, unless and until such default is cured or waived or ceases to exist, International Seaways, Inc. will make no direct or indirect payment (in cash, property, securities, by set-off or otherwise) in respect of the principal of or interest on the subordinated debt securities or in respect of any redemption, retirement, purchase or other requisition of any of the subordinated debt securities.

 

In the event of the acceleration of the maturity of any subordinated debt securities, the holders of all senior debt securities outstanding at the time of such acceleration will first be entitled to receive payment in full of all amounts due on senior debt securities before the holders of subordinated debt securities will be entitled to receive any payment of principal (and premium, if any) or interest on the subordinated debt securities.

 

If any of the following events occur, International Seaways, Inc. will pay in full all Senior Indebtedness before it makes any payment or distribution under subordinated debt securities, whether in cash, securities or other property, to any holder of subordinated debt securities:

 

· any dissolution or winding-up or liquidation or reorganization of International Seaways, Inc., whether voluntary or involuntary or in bankruptcy, insolvency or receivership;

 

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· any general assignment by International Seaways, Inc. for the benefit of creditors; or

 

· any other marshaling of International Seaways, Inc.’s assets or liabilities.

 

In such event, any payment or distribution under subordinated debt securities, whether in cash, securities or other property, which would otherwise (but for the subordination provisions) be payable or deliverable in respect of such subordinated debt securities, will be paid or delivered directly to the holders of Senior Indebtedness in accordance with the priorities then existing among such holders until all Senior Indebtedness has been paid in full. If any payment or distribution under subordinated debt securities is received by the trustee of any subordinated debt securities in contravention of any of the terms of the Subordinated Indenture and before all the Senior Indebtedness has been paid in full, such payment or distribution or security will be received in trust for the benefit of, and paid over or delivered and transferred to, the holders of Senior Indebtedness at the time outstanding in accordance with the priorities then existing among such holders for application to the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay all such Senior Indebtedness in full.

 

The Subordinated Indenture does not limit the issuance of additional Senior Indebtedness.

 

If subordinated debt securities are issued to a trust in connection with the issuance of trust preferred securities, such subordinated debt securities may thereafter be distributed pro rata to the holders of such trust securities in connection with the dissolution of such trust upon the occurrence of certain events described in the applicable prospectus supplement.

 

Events of Default, Notice and Waiver

 

Unless an accompanying prospectus supplement states otherwise, the following shall constitute “Events of Default” under the Indentures with respect to each series of debt securities:

 

· International Seaways, Inc.’s failure to pay any interest on any debt security of such series when due and payable, continued for 30 days;

 

· International Seaways, Inc.’s failure to pay principal (or premium, if any) on any debt security of such series when due, regardless of whether such payment became due because of maturity, redemption, acceleration or otherwise, or is required by any sinking fund established with respect to such series;

 

· International Seaways, Inc.’s failure to observe or perform any other of its covenants or agreements with respect to such debt securities for 90 days after it receives notice of such failure;

 

· certain defaults with respect to International Seaways, Inc.’s or its subsidiaries debt in any aggregate principal amount in excess of $35,000,000 consisting of the failure to make any payment at maturity or that results in acceleration of the maturity of such debt; and

 

· certain events of bankruptcy, insolvency or reorganization of International Seaways, Inc. or any Significant Subsidiary (as defined in Rule 1-02(w) of Regulation S-X)

 

If an Event of Default with respect to any debt securities of any series outstanding under either of the Indentures shall occur and be continuing, the trustee under such Indenture or the holders of at least 25% in aggregate principal amount of the debt securities of that series outstanding may declare, by notice as provided in the applicable Indenture, the principal amount (or such lesser amount as may be provided for in the debt securities of that series) of the debt securities of that series outstanding to be due and payable immediately; provided that, in the case of an Event of Default involving certain events in bankruptcy, insolvency or reorganization, acceleration is automatic; and, provided further, that after such acceleration, but before a judgment or decree based on acceleration, the holders of a majority in aggregate principal amount of the outstanding debt securities of that series may, under certain circumstances, rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal, have been cured or waived.

 

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Upon the acceleration of the maturity of original issue discount securities, an amount less than the principal amount thereof will become due and payable.

 

Reference is made to the prospectus supplement relating to any original issue discount securities for the particular provisions relating to acceleration of maturity thereof. Any past default under either Indenture with respect to debt securities of any series, and any Event of Default arising therefrom, may be waived by the holders of a majority in principal amount of all debt securities of such series outstanding under such Indenture, except in the case of (i) default in the payment of the principal of (or premium, if any) or interest on any debt securities of such series or (ii) default in respect of a covenant or provision which may not be amended or modified without the consent of the holder of each outstanding debt security of such series affected.

 

The trustee is required, within 90 days after the occurrence of a default (which is known to the trustee and is continuing), with respect to the debt securities of any series (without regard to any grace period or notice requirements), to give to the holders of debt securities of such series notice of such default; provided, however, that, except in the case of a default in the payment of the principal of (and premium, if any) or interest, or in the payment of any sinking fund installment, on any debt securities of such series, the trustee shall be protected in withholding such notice if it in good faith determines that the withholding of such notice is in the interests of the holders of debt securities of such series.

 

The trustee, subject to its duties during default to act with the required standard of care, may require indemnification by the holders of debt securities of any series with respect to which a default has occurred before proceeding to exercise any right or power under the Indentures at the request of the holders of debt securities of such series. Subject to such right of indemnification and to certain other limitations, the holders of a majority in principal amount of the outstanding debt securities of any series under either Indenture may direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee with respect to debt securities of such series.

 

No holder of a debt security of any series may institute any action against International Seaways, Inc. under either of the Indentures (except actions for payment of overdue principal of (and premium, if any) or interest on such debt security or for the conversion or exchange of such debt security in accordance with its terms) unless (i) the holder has given to the trustee written notice of an Event of Default and of the continuance thereof with respect to debt securities of such series specifying an Event of Default, as required under the applicable Indenture, (ii) the holders of at least 25% in aggregate principal amount of debt securities of that series then outstanding under such Indenture shall have requested the trustee to institute such action and offered to the trustee indemnity reasonably satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request and (iii) the trustee shall not have instituted such action within 60 days of such request.

 

The terms of the Indentures require that International Seaways, Inc. furnish annually to the trustee statements as to its compliance with all conditions and covenants under each Indenture.

 

Discharge, Defeasance and Covenant Defeasance

 

If indicated in the applicable prospectus supplement, International Seaways, Inc. may discharge or defease its obligations under each Indenture as set forth below.

 

International Seaways, Inc. may discharge certain obligations to holders of any series of debt securities issued under either the Senior Indenture or the Subordinated Indenture which have not already been delivered to the trustee for cancellation and which have either become due and payable or are by their terms due and payable within one year (or scheduled for redemption within one year) by irrevocably depositing with the trustee cash or, in the case of debt securities payable only in U.S. dollars, U.S. Government Obligations (as defined in either Indenture), as trust funds in an amount certified to be sufficient to pay when due, whether at maturity, upon redemption or otherwise, the principal of (and premium, if any) and interest on such debt securities.

 

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If indicated in the applicable prospectus supplement, International Seaways, Inc. may elect either (i) to defease and be discharged from any and all obligations with respect to debt securities of or within any series (except as otherwise provided in the relevant Indenture) (“defeasance”) or (ii) to be released from its obligations with respect to certain covenants applicable to debt securities of or within any series (“covenant defeasance”), upon the deposit with the relevant Indenture trustee, in trust for such purpose, of money and/or government obligations which through the payment of principal and interest in accordance with their terms will provide money in an amount sufficient, without reinvestment, to pay the principal of (and premium, if any) or interest on such debt securities to maturity or redemption, as the case may be, and any mandatory sinking fund or analogous payments thereon. As a condition to defeasance or covenant defeasance, International Seaways, Inc. must deliver to the trustee an opinion of counsel to the effect that the holders of such debt securities will not recognize income, gain or loss for federal income tax purposes as a result of such defeasance or covenant defeasance and will be subject to federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such defeasance or covenant defeasance had not occurred. Such opinion of counsel, in the case of defeasance under clause (i) above, must refer to and be based upon a ruling of the Internal Revenue Service or a change in applicable federal income tax law occurring after the date of the relevant Indenture. In addition, in the case of either defeasance or covenant defeasance, International Seaways, Inc. shall have delivered to the trustee (i) an officers’ certificate to the effect that the relevant debt securities exchange(s) have informed it that neither such debt securities nor any other debt securities of the same series, if then listed on any securities exchange, will be delisted as a result of such deposit and (ii) an officers’ certificate and an opinion of counsel, each stating that all conditions precedent with respect to such defeasance or covenant defeasance have been complied with. International Seaways, Inc. may exercise its defeasance option with respect to such debt securities notwithstanding its prior exercise of its covenant defeasance option.

 

Modification and Waiver

 

Under the Indentures, International Seaways, Inc. and the applicable trustee may supplement the Indentures for certain purposes which would not materially adversely affect the interests or rights of the holders of debt securities of a series without the consent of those holders. International Seaways, Inc. and the applicable trustee may also modify the Indentures or any supplemental indenture in a manner that affects the interests or rights of the holders of debt securities with the consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each affected series issued under the Indenture. However, the Indentures require the consent of each holder of debt securities that would be affected by any modification which would:

 

· extend the fixed maturity of any debt securities of any series, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof;

 

· reduce the amount of principal of an original issue discount debt security or any other debt security payable upon acceleration of the maturity thereof;

 

· change the currency in which any debt security or any premium or interest is payable;

 

· impair the right to institute suit for any payment on or with respect to any debt security;

 

· reduce the percentage in principal amount of outstanding debt securities of any series, the consent of whose holders is required for modification or amendment of the Indentures or for waiver of compliance with certain provisions of the Indentures or for waiver of certain defaults;

 

· reduce the requirements contained in the Indentures for quorum or voting; or

 

· modify any of the above provisions.

 

If subordinated debt securities are held by a trust or a trustee of a trust, a supplemental indenture that affects the interests or rights of the holders of debt securities will not be effective until the holders of not less than a majority in liquidation preference of the preferred securities and common securities of the applicable trust, collectively, have consented to the supplemental indenture; provided, further, that if the consent of the holder of each outstanding debt security is required, the supplemental indenture will not be effective until each holder of the preferred securities and the common securities of the applicable trust has consented to the supplemental indenture.

 

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The Indentures permit the holders of at least a majority in aggregate principal amount of the outstanding debt securities of any series issued under the Indentures which is affected by the modification or amendment to waive International Seaways, Inc.’s compliance with certain covenants contained in the Indentures.

 

Payment and Paying Agents

 

Unless otherwise indicated in the applicable prospectus supplement, payment of interest on a debt security on any interest payment date will be made to the person in whose name a debt security is registered at the close of business on the record date for the interest.

 

Unless otherwise indicated in the applicable prospectus supplement, principal, interest and premium on the debt securities of a particular series will be payable at the office of such paying agent or paying agents as International Seaways, Inc. may designate for such purpose from time to time.

 

Notwithstanding the foregoing, at International Seaways, Inc.’s option, payment of any interest may be made by check mailed to the address of the person entitled thereto as such address appears in the security register.

 

Unless otherwise indicated in the applicable prospectus supplement, a paying agent designated by International Seaways, Inc. and located in the Borough of Manhattan, The City of New York will act as paying agent for payments with respect to debt securities of each series. All paying agents initially designated by International Seaways, Inc. for debt securities of a particular series will be named in the applicable prospectus supplement. International Seaways, Inc. may at any time designate additional paying agents or rescind the designation of any paying agent or approve a change in the office through which any paying agent acts, except that International Seaways, Inc. will be required to maintain a paying agent in each place of payment for debt securities of a particular series.

 

All moneys paid by International Seaways, Inc. to a paying agent for the payment of the principal, interest or premium on any debt security which remain unclaimed at the end of two years after such principal, interest or premium has become due and payable will be repaid to International Seaways, Inc. upon request, and the holder of such debt security thereafter may look only to International Seaways, Inc. for payment thereof.

 

Denominations, Registrations and Transfer

 

Unless an accompanying prospectus supplement states otherwise, debt securities will be represented by one or more global certificates registered in the name of a nominee for The Depository Trust Company, or DTC. In such case, each holder’s beneficial interest in the global securities will be shown on the records of DTC and transfers of beneficial interests will only be effected through DTC’s records.

 

A holder of debt securities may only exchange a beneficial interest in a global security for certificated securities registered in the holder’s name if:

 

· DTC notifies International Seaways, Inc. that it is unwilling or unable to continue serving as the depositary for the relevant global securities; or

 

· DTC ceases to maintain certain qualifications under the Exchange Act and no successor depositary has been appointed for 90 days; or

 

· International Seaways, Inc. determines, in its sole discretion, that the global security shall be exchangeable.

 

If debt securities are issued in certificated form, they will only be issued in the minimum denomination specified in the accompanying prospectus supplement and integral multiples of such denomination. Transfers and exchanges of such debt securities will only be permitted in such minimum denomination. Transfers of debt securities in certificated form may be registered at the trustee’s corporate office or at the offices of any paying agent or trustee appointed by International Seaways, Inc. under the Indentures. Exchanges of debt securities for an equal aggregate principal amount of debt securities in different denominations may also be made at such locations.

 

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Governing Law

 

The Senior Indenture, the Subordinated Indenture and debt securities will be governed by, and construed in accordance with, the internal laws of the State of New York, without regard to its principles of conflicts of laws.

 

Relationship with the Trustees

 

Unless the applicable prospectus supplement states otherwise, the trustee under the Senior Indenture is, and the trustee under the Subordinated Indenture is, The Bank of New York Mellon. We and our subsidiaries maintain ordinary banking and trust relationships with a number of banks and trust companies.

 

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DESCRIPTION OF PREFERRED STOCK

 

General

 

International Seaways, Inc.’s Amended and Restated Articles of Incorporation authorizes the board of directors or a committee of the board of directors to cause preferred stock to be issued in one or more series, without stockholder action. They are authorized to issue up to 10,000,000 shares of preferred stock, without par value, and can determine the number of shares of each series, and the rights, preferences and limitations of each series. We may amend the Amended and Restated Articles of Incorporation to increase the number of authorized shares of preferred stock in a manner permitted by the Amended and Restated Articles of Incorporation and Marshall Islands law. As of the date of this prospectus, there is no preferred stock outstanding.

 

The particular terms of any series of preferred stock offered by us will be described in the prospectus supplement relating to that series of preferred stock. Those terms relating to the series of preferred stock offered may include:

 

the number of shares of the preferred stock being offered;

 

the title and liquidation preference per share of the preferred stock;

 

the purchase price of the preferred stock;

 

the dividend rate or method for determining the dividend rate;

 

the dates on which dividends will be paid;

 

whether dividends on the preferred stock will be cumulative or noncumulative and, if cumulative, the dates from which dividends shall commence to accumulate;

 

any redemption or sinking fund provisions applicable to the preferred stock;

 

any securities exchange on which the preferred stock may be listed; and

 

any additional dividend, liquidation, redemption, sinking fund and other rights and restrictions applicable to the preferred stock.

 

The following summary is not complete. You should refer to the certificate of designations relating to any series of preferred stock for the complete terms of that preferred stock. The certificate of designations will be filed with the SEC at the time of the offering of the preferred stock. Unless otherwise specified in the applicable prospectus supplement, if we liquidate, dissolve or wind-up our business, each series of preferred stock will have the same rank as to dividends and distributions as each other series of preferred stock we may issue in the future. Preferred stock will have no preemptive rights.

 

Dividend Rights

 

Holders of preferred stock will be entitled to receive, when, as and if declared by the board of directors, cash dividends at the rates and on the dates set forth in the related prospectus supplement. Dividend rates may be fixed or variable or both. Different series of preferred stock may be entitled to dividends at different dividend rates or based upon different methods of determination. Each dividend will be payable to the holders of record as they appear on our stock books on record dates determined by the board of directors. Dividends on preferred stock may be cumulative or noncumulative, as specified in the related prospectus supplement. If the board of directors fails to declare a dividend on any preferred stock for which dividends are noncumulative, then the right to receive that dividend will be lost, and we will have no obligation to pay the dividend for that dividend period, whether or not dividends are declared for any future dividend period.

 

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No full dividends will be declared or paid on any preferred stock unless full dividends for the dividend period commencing after the immediately preceding dividend payment date and any cumulative dividends still owing have been or contemporaneously are declared and paid on all other series of preferred stock which have the same rank as, or rank senior to, that series of preferred stock. When those dividends are not paid in full, dividends will be declared pro rata, so that the amount of dividends declared per share on that series of preferred stock and on each other series of preferred stock having the same rank as that series of preferred stock will bear the same ratio to each other that accrued dividends per share on that series of preferred stock and the other series of preferred stock bear to each other. In addition, generally, unless full dividends including any cumulative dividends still owing on all outstanding shares of any series of preferred stock have been paid, no dividends will be declared or paid on the common stock and generally we may not redeem or purchase any common stock. No interest will be paid in connection with any dividend payment or payments which may be in arrears.

 

Unless otherwise set forth in the related prospectus supplement, the dividends payable for each dividend period will be computed by annualizing the applicable dividend rate and dividing by the number of dividend periods in a year, except that the amount of dividends payable for the initial dividend period or any period shorter than a full dividend period will be computed on the basis of a 360-day year consisting of twelve 30-day months and, for any period less than a full month, the actual number of days elapsed in the period.

 

Rights Upon Liquidation

 

If we liquidate, dissolve or wind-up our affairs, either voluntarily or involuntarily, the holders of each series of preferred stock will be entitled to receive liquidating distributions in the amount set forth in the prospectus supplement relating to the series of preferred stock, plus an amount equal to any accrued and unpaid dividends before any distribution of assets is made to the holders of common stock. If the amounts payable with respect to preferred stock of any series and any stock having the same rank as that series of preferred stock are not paid in full, the holders of the preferred stock will share ratably in any such distribution of assets in proportion to the full respective preferential amounts to which they are entitled. After the holders of each series of preferred stock having the same rank are paid in full, they will have no right or claim to any of our remaining assets. Neither the sale of all or substantially all of our property or business nor a merger or consolidation by us with any other corporation will be considered a dissolution, liquidation or winding up by us of our business or affairs.

 

Redemption

 

Any series of preferred stock may be redeemable in whole or in part at our option. In addition, any series of preferred stock may be subject to mandatory redemption pursuant to a sinking fund. The redemption provisions that may apply to a series of preferred stock, including the redemption dates and the redemption prices for that series, will be set forth in the related prospectus supplement.

 

If a series of preferred stock is subject to mandatory redemption, the related prospectus supplement will specify the year we can begin to redeem shares of the preferred stock, the number of shares of the preferred stock we can redeem each year, and the redemption price per share. We may pay the redemption price in cash, stock or other securities of INSW or of third parties, as specified in the related prospectus supplement.

 

If fewer than all the outstanding shares of any series of preferred stock are to be redeemed, whether by mandatory or optional redemption, the board of directors will determine the method for selecting the shares to be redeemed, which may be by lot or pro rata by any other method determined to be equitable. From and after the redemption date, dividends will cease to accrue on the shares of preferred stock called for redemption and all rights of the holders of those shares other than the right to receive the redemption price will cease.

 

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Conversion Rights

 

The related prospectus supplement will state any conversion rights under which shares of preferred stock are convertible into shares of common stock or another series of preferred stock or debt securities.

 

Voting Rights

 

For most series of preferred stock, the holders of preferred stock will generally not be entitled to vote. Except as indicated in the related prospectus supplement, if we issue full shares of any series of preferred stock, each share will be entitled to one vote on matters on which holders of that series of preferred stock are entitled to vote. Because each full share of any series of preferred stock will be entitled to one vote, the voting power of that series will depend on the number of shares in that series, and not on the aggregate liquidation preference or initial offering price of the shares of that series of preferred stock.

 

Transfer Agent and Registrar

 

We will appoint a transfer agent, registrar and dividend disbursement agent for the preferred stock. The registrar for the preferred stock will send notices to the holders of the preferred stock of any meeting at which those holders will have the right to elect directors or to vote on any other matter.

 

Permanent Global Preferred Securities

 

A series of preferred stock may be issued in whole or in part in the form of one or more global securities that will be deposited with a depositary or its nominee identified in the related prospectus supplement. For most series of preferred stock, the depositary will be DTC (as defined herein). A global security may not be transferred except as a whole to the depositary, a nominee of the depositary or their successors unless it is exchanged in whole or in part for preferred stock in individually certificated form. For a description of the depositary arrangements, see “Book-Entry Issuance.” Any additional terms of the depositary arrangement with respect to any series of preferred stock and the rights of and limitations on owners of beneficial interests in a global security representing a series of preferred stock may be described in the related prospectus supplement.

 

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DESCRIPTION OF CAPITAL STOCK

 

The following descriptions are summaries of the material terms of our capital stock, articles of incorporation and by-laws, each as amended and restated, and any references to Republic of the Marshall Islands (the “RMI”) law are not meant to be complete and are subject to, and qualified in their entirety by, reference to our amended and restated articles of incorporation (“Amended and Restated Articles of Incorporation”), a copy of which has been filed as an exhibit to our Current Report on Form 8-K dated December 2, 2016 and is incorporated by reference into the registration statement of which this prospectus forms a part, our amended and restated by-laws (“Amended and Restated By-Laws”), a copy of which has been filed as an exhibit to our Current Report on Form 8-K dated December 2, 2016 and is incorporated by reference into the registration statement of which this prospectus forms a part, and to the RMI Business Corporations Act (the “BCA”). See “Where You Can Find More Information.” These descriptions may not contain all of the information that may be important to you and should be read in conjunction with our Amended and Restated Articles of Incorporation, Amended and Restated By-Laws and applicable provisions of the BCA.

 

Authorized Capitalization

 

Our authorized capital stock consists of (a) 100,000,000 authorized shares of common stock, no par value (the “common stock”), and (b) 10,000,000 shares of preferred stock, no par value (the “preferred stock”).

 

As of March 31, 2018, there were 29,123,331 shares of common stock outstanding and no shares of preferred stock outstanding.

 

Common Stock

 

The holders of our common stock are entitled to such dividends as our board of directors may declare from time to time from legally available funds, based on the number of shares of common stock then held of record by such holder, subject to the preferential rights of the holders of any shares of preferred stock that we may issue in the future. The holders of our common stock are entitled to one vote per share.

 

Our Amended and Restated Articles of Incorporation do not provide for cumulative voting in the election of directors, which means that the holders of a majority of the outstanding shares of common stock can elect all of the directors standing for election, and the holders of the remaining shares are not able to elect any directors. Our Amended and Restated By-Laws provide that directors will be elected by a majority of the shares voting once a quorum is present.

 

Upon any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of our common stock are entitled to share, on a pro rata basis, all assets remaining after payment to claimants and creditors and subject to prior distribution rights of any shares of preferred stock that we may issue in the future. All of the outstanding shares of common stock are fully paid and non-assessable. Holders of our common stock have no preemptive rights, conversion rights or other subscription rights as set out in our Amended and Restated Articles of Incorporation, and there are no redemption or sinking fund provisions applicable to our common stock. The rights, preferences and privileges of holders of common stock are subject to, and may be impacted by, the rights of the holders of shares of any series of preferred stock that we may designate and issue in the future.

 

As of March 31, 2018, there were approximately 200 holders of record of our common stock, including Cede & Co. as nominee for DTC.

 

Preferred Stock

 

The terms pursuant to which we may issue preferred stock are described above under “Description of Preferred Stock.” Preferred stock could have voting or conversion rights that could adversely affect the voting power or other rights of holders of our common stock and the issuance of preferred stock could also have the effect, under certain circumstances, of delaying, deferring or preventing a change of control of us.

 

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Anti-Takeover Effects of Provisions of our Amended and Restated Articles of Incorporation, our Amended and Restated By-Laws and RMI Law

 

Our Amended and Restated Articles of Incorporation and Amended and Restated By-Laws contain a number of provisions relating to corporate governance and to the rights of stockholders. Certain of these provisions may be deemed to have a potential “anti-takeover” effect in that such provisions may delay, defer or prevent a change of control or an unsolicited acquisition proposal that a stockholder might consider favorable, including a proposal that might result in the payment of a premium over the market price for the shares held by the stockholders. Examples of such provisions in our Amended and Restated Articles of Incorporation and Amended and Restated By-Laws relating to corporate governance and the rights of stockholders, certain of which may be deemed to have a potential “anti-takeover” effect include:

 

Authorized but Unissued or Undesignated Capital Stock . Our authorized capital stock consists of 100,000,000 authorized shares of common stock and 10,000,000 shares of preferred stock. A large quantity of authorized but unissued shares may deter potential takeover attempts because of the ability of our board of directors to authorize the issuance of some or all of these shares to a friendly party, or to the public, which would make it more difficult for a potential acquirer to obtain control of us. This possibility may encourage persons seeking to acquire control of us to negotiate first with our board of directors. The authorized but unissued stock may be issued by the board of directors in one or more transactions. In this regard, our Amended and Restated Articles of Incorporation grants the board of directors broad power to establish the rights and preferences of authorized and unissued preferred stock. Although our Amended and Restated Articles of Incorporation prohibits the board of directors, without the affirmative vote of at least a majority of the total voting power of our outstanding shares of capital stock entitled to vote on such matters, voting as a class, from issuing any preferred stock for any defensive or anti-takeover purpose, for the purpose of implementing any shareholder rights plan or with features specifically intended to make any attempted acquisition of the Corporation more difficult or costly, the issuance of shares of preferred stock pursuant to the board of directors’ authority described above could decrease the amount of earnings and assets available for distribution to holders of common stock and adversely affect the rights and powers, including voting rights, of such holders and may have the effect of delaying, deferring or preventing a change of control. The board of directors does not currently intend to seek stockholder approval prior to any issuance of preferred stock, unless otherwise required by law or our Amended and Restated Articles of Incorporation.

 

Action by Written Consent. Our Amended and Restated By-Laws and Section 67 of the BCA provide that stockholder action can be taken by written consent in lieu of a meeting if all stockholders entitled to vote on the subject matter unanimously consent.

 

Special Meetings of Stockholders. Our Amended and Restated By-Laws provide that special meetings of our stockholders may be called only by the President or any Vice President, by resolution of the board of directors or by holders of not less than 25% of all outstanding shares entitled to vote on the matter for which the meeting is called. Our Amended and Restated By-Laws prohibit the conduct of any business at a special meeting other than as specified in the notice for such meeting.

 

Advance Notice Procedures. Our Amended and Restated By-Laws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors. In order for any matter to be “properly brought” before a meeting, a stockholder will have to comply with advance notice requirements and provide us with certain information. Generally, to be timely, a stockholder’s notice must be received at our principal executive offices not less than 60 days nor more than 90 days prior to the first anniversary of the date of the immediately preceding annual meeting. In the event that the date of the annual meeting is more than 30 days earlier or more than 60 days later than such anniversary date, notice by the stockholder must be received no earlier than 90 days prior to the annual meeting and not later than the later of 60 days prior to the annual meeting or 10 days following the public announcement of the date of the annual meeting. Our Amended and Restated By-Laws also specify requirements as to the form and content of a stockholder’s notice. These provisions may defer, delay or discourage a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to influence or obtain control of us.

 

Super Majority Approval Requirements . Our Amended and Restated By-Laws provide that our board of directors, at any regular meeting or special meeting called for the purpose, and our stockholders, at any annual meeting or special meeting called for the purpose, may make, alter, amend or repeal our Amended and Restated By-Laws. However, our board of directors may not, without the affirmative vote of a majority of the outstanding stock entitled to vote on such matters, alter, amend or repeal certain provisions of our Amended and Restated By-Laws, including those relating to stockholder meeting quorum requirements, majority election of directors, notification of the nominations for the election of directors, special meetings of our board of directors, committees of the board of directors and amendments to the Amended and Restated By-Laws. Further, our board of directors may not, without the affirmative vote of the holders of two-thirds or more of the outstanding stock entitled to vote on such matters, alter, amend or repeal certain other provisions of our Amended and Restated By-Laws, including those relating to the calling of special meetings by stockholders and stockholder action by written consent.

 

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The BCA provides generally that the affirmative vote of a majority of the outstanding shares then entitled to vote is required to amend a corporation’s articles of incorporation, unless the articles of incorporation requires a greater percentage. Our Amended and Restated Articles of Incorporation provides that specified provisions, including those relating to amendment of our Amended and Restated Articles of Incorporation and the procedures by which any action required or permitted to be taken by holders of common stock may be performed, may only be amended or repealed by the affirmative vote of two-thirds (2/3) of the combined voting power of the outstanding shares of our capital stock.

 

The combination of these provisions may make it more difficult for our existing stockholders to replace our board of directors as well as for another party to obtain control of us by replacing our board of directors. Because our board of directors has the power to retain or discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management.

 

Exclusive Forum

 

Our Amended and Restated By-Laws provide that unless we consent in writing to the selection of an alternate forum, the State and Federal Court located in the State of Delaware is the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees, (iii) any action asserting a claim against us arising pursuant to the BCA or (iv) any action asserting a claim against us that is governed by the bylaws, in all cases subject to the court having personal jurisdiction over the parties named as defendants. Any person or entity purchasing or otherwise acquiring any interest in our shares of common stock shall be deemed to have notice of and consented to the forum provisions in our Amended and Restated By-Laws.

 

Dissenters’ Rights of Appraisal and Payment

 

Under the BCA, with certain exceptions, our stockholders will have appraisal rights in connection with a merger or consolidation of us. Pursuant to the BCA, stockholders who properly request and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the appropriate court. See “Description of Capital Stock—Exclusive Forum” above.

 

Stockholders’ Derivative Actions

 

Under the BCA, any of our stockholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the stockholder bringing the action is a holder of our shares at the time of the transaction to which the action relates or such stockholder’s stock thereafter devolved by operation of law.

 

Limitations on Liability and Indemnification of Officers and Directors

 

Under the BCA, a Marshall Islands corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to or a witness in or is otherwise involved in any threatened, pending or completed action, suit, claim, inquiry or proceeding whether civil, criminal, administrative or investigative (including an action by or in the right of the corporation) and whether formal or informal, by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the corporation, or, while a director or officer of the corporation, is or was serving at the request of the corporation as a director, officer, employee, trustee or agent of another corporation, partnership, joint venture, trust, nonprofit or other entity, including service with respect to employee benefit plans, against all liability and loss suffered, and expenses (including attorneys’ fees) actually and reasonably incurred by him or her in connection with such action, suit or proceeding. The corporation shall be required to indemnify or advance expenses to such a person in connection with a proceeding commenced by the person against the corporation only if the commencement of such proceeding was authorized in the specific case by the Board of Directors or was brought to establish or enforce a right to indemnification under the bylaws, the corporation’s articles of incorporation, any agreement, the laws of the RMI or otherwise.

 

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To the extent that a director or officer of a Marshall Islands corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in the preceding paragraphs, or in the defense of a claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him or her in connection therewith. Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid in advance of the final disposition of such action, suit or proceeding as authorized by the board of directors in the specific case upon receipt of an undertaking by or on behalf of the director or officer to repay such amount unless it shall ultimately be determined that he or she is entitled to be indemnified by the corporation as authorized in the BCA.

 

In addition, a Marshall Islands corporation has the power to purchase and maintain insurance on behalf of any person who is or was a director or officer of the corporation or is or was serving at the request of the corporation as a director or officer against any liability asserted against him or her and incurred by him or her in such capacity whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of the BCA. The indemnification provisions of the BCA are not exclusive of any other rights under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise.

 

Our Amended and Restated Articles of Incorporation limits the liability of our directors to the fullest extent permitted by the BCA and requires that we will provide them with customary indemnification.

 

Transfer Agent and Registrar

 

The transfer agent and registrar for our common stock is Computershare Trust Company, N.A.

 

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PLAN OF DISTRIBUTION

 

We may offer and sell the securities from time to time as follows:

 

· to or through underwriters or dealers for resale;

 

· directly to other purchasers;

 

· through designated agents; and

 

· through a combination of any of these methods of sale.

 

Any underwriter or agent involved in the offer and sale of our securities, and the compensation, discounts and commissions, if applicable, to be paid to such underwriter or agent, will be specified in the applicable prospectus supplement or pricing supplement.

 

The securities, including securities issued or to be issued by us in connection with arrangements under which we agree to issue securities to underwriters or their affiliates on a delayed or contingent basis, that we distribute by any of these methods may be sold to the public, in one or more transactions, at:

 

· a fixed price or prices, which may be changed;

 

· market prices prevailing at the time of sale;

 

· prices related to prevailing market prices; or

 

· negotiated prices.

 

In connection with the sale of securities, underwriters may receive compensation from us or from purchasers of the securities, for whom they may act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the distribution of the securities may be deemed to be underwriters, and any discounts or commissions they receive from us, and any profit on the resale of the securities they realize may be deemed to be underwriting discounts and commissions under the Securities Act. Any such underwriter, dealer or agent will be identified, and any such compensation received will be described, in the applicable prospectus supplement.

 

Unless otherwise specified in the applicable prospectus supplement, each series of the securities will be a new issue with no established trading market, We may elect to list any of the securities on an exchange, but are not obligated to do so. It is possible that one or more underwriters may make a market in a series of the securities, but will not be obligated to do so and may discontinue any market making at any time without notice. Therefore, no assurance can be given as to the liquidity of the trading market for the securities.

 

If dealers are utilized in the sale of the securities, we may sell the securities to the dealers as principals or the dealers may act as our agents. If the dealers act as principal, they may then resell the securities to the public at varying prices to be determined by such dealers at the time of resale. The names of the dealers and the terms of the transaction will be set forth in the applicable prospectus supplement.

 

We may enter into agreements with underwriters, dealers and agents who participate in the distribution of the securities which may entitle these persons to indemnification by us against certain liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which such underwriters, dealers or agents may be required to make. Any agreement in which we agree to indemnify underwriters, dealers and agents against civil liabilities will be described in the applicable prospectus supplement.

 

In connection with an offering, the underwriters may purchase and sell securities in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of securities than they are required to purchase in an offering. Stabilizing transactions consist of certain bids or purchases made for the purpose of preventing or retarding a decline in the market price of the securities while an offering is in progress.

 

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The underwriters also may impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the underwriters have repurchased securities sold by or for the account of that underwriter in stabilizing or short-covering transactions.

 

These activities by the u n de r writers may stabilize, maintain or otherwise affect the market price of the securities. As a result, the price of the securities may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued by the underwriters at any time. These transactions may be effected on an exchange or automated quotation system, if the securities are listed on that exchange or admitted for trading on that automated quotation system, or in the over-the-counter market or otherwise.

 

If so indicated in the applicable prospectus supplement, we will authorize underwriters or other persons acting as our agents to solicit offers by certain purchasers to purchase the securities from us at the public offering price stated in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a future date. These contracts will be subject to only those conditions stated in the prospectus supplement, and the prospectus supplement will state the commission payable to the solicitor of such offers.

 

Underwriters, dealers and agents , and their respective affiliates and associates, may engage in transactions with or perform services for us, or be customers of ours, in the ordinary course of business.

 

LEGAL MATTERS

 

Unless otherwise indicated in the applicable prospectus supplement, the validity of any preferred stock offered hereby will be passed upon for us by Reeder & Simpson, P.C., a Marshall Islands law corporation, and the validity of any debt securities offered hereby will be passed upon for us by Cleary Gottlieb Steen & Hamilton LLP.

 

EXPERTS

 

The consolidated financial statements of International Seaways, Inc. appearing in our Current Report on Form 8-K dated May 14, 2018 (including the schedule appearing therein) for the year ended December 31, 2017, and the effectiveness of the Company’s internal control over financial reporting as of December 31, 2017, have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such reports given on the authority of such firm as experts in accounting and auditing.

 

The financial statements as of December 31, 2016 and for each of the two years in the period ended December 31, 2016 incorporated in this Prospectus by reference to International Seaways, Inc.’s Current Report on Form 8-K dated May 14, 2018 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

 

WHERE YOU CAN FIND MORE INFORMATION

 

This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules filed with it. For further information about us, our common stock and other information set forth herein, reference is made to the registration statement and exhibits and schedules with it. Statements contained in this prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and each such statement is subject to, and qualified in its entirety by, reference to the applicable contract or other document filed herewith. 

 

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We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any materials we have filed with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. The SEC also maintains a website at http://www.sec.gov that contains reports, proxy and information statements and other information concerning issuers that file electronically with the SEC, including us. We also maintain a website at www.intlseas.com that contains information concerning us, including the reports we file with the SEC. The information contained or referred to on our website is not incorporated by reference in this prospectus and is not a part of this prospectus.

 

We also make available on our website our corporate governance guidelines, code of business conduct and ethics, insider trading policy, anti-bribery and corruption policy and charters of the audit committee, human resources and compensation committee and corporate governance and risk assessment committee of our board of directors. Information on, or accessible through, our website is not part of this prospectus. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website.

 

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

 

The SEC allows us to “incorporate by reference” the information we file with the SEC, which means that we can disclose important information to you by referring you to those filed documents. The information incorporated by reference is considered to be part of this prospectus.

 

We incorporate by reference the documents listed below, except to the extent that any information contained in such filings is deemed “furnished” in accordance with SEC rules:

 

  Our Annual Report on Form 10-K, filed with the Commission on March 12, 2018, as updated by our Current Report on Form 8-K filed with the Commission on May 14, 2018;
     
  Our Quarterly Report on Form 10-Q, filed with the Commission on May 7, 2018;
     
  Our Proxy Statement, filed with the Commission on April 12, 2018; and
     
  Our Current Reports on Form 8-K, filed with the Commission on April 10, 2018; April 24, 2018; April 30, 2018; May 4, 2018 and May 14, 2018.

 

We also incorporate by reference any filings made with the SEC in accordance with Section 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus and until the date all of the securities offered hereby are sold or the offering is otherwise terminated, with the exception of any information contained in such filings that is deemed “furnished” in accordance with SEC rules, unless such information is expressly incorporated herein by a reference in such filings. Any such filings shall be deemed to be incorporated by reference and to be a part of this prospectus from the respective dates of filing of those documents.

 

The documents incorporated by reference in this prospectus contain important information about us and our financial condition. Information contained in this prospectus supersedes information incorporated by reference that we have filed with the SEC prior to the date of this prospectus, while information included in any accompanying prospectus supplement or post-effective amendment will supersede this information.

 

Statements contained in this registration statement or any accompanying prospectus supplement as to the contents of any contract or other document that is filed or incorporated by reference as an exhibit to the registration statement are not necessarily complete and we refer you to the full text of the contract or other document filed or incorporated by reference as an exhibit to the registration statement.

 

Our filings are available on our website at www.intlseas.com. Information on, or accessible through, our website is not part of this prospectus. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website. We will provide without charge to each person to whom this prospectus and any accompanying prospectus supplement is delivered, upon written or oral request of such person, a copy of any or all of the documents referred to above that have been incorporated by reference into this prospectus and any accompanying prospectus supplement. Requests for such documents should be directed to International Seaways, Inc., 600 Third Avenue, 39 th Floor, New York, New York 10016, Attention: Investor Relations, (212) 578-1645.

 

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International Seaways, Inc.

 

Debt Securities and Preferred Stock

 

 

 

PROSPECTUS

 

 

 

May [___], 2018

 

 

 

 

 

 

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 14. Other Expenses of Issuance and Distribution.

 

The following table sets forth the estimated fees and expenses payable by the registrant in connection with the offering and sale of our Common Stock, other than any estimated underwriting discounts and commissions:

 

SEC registration fee   $ 12,450  
Printing, engraving, edgarization and filing expenses     5,000  
Blue sky fees and expenses (including related legal fees)      
Legal fees and expenses     415,000  
Accounting fees and expenses     250,000  
Miscellaneous      50,000  
Total   $ 732,450  

  

In the event securities being offered under this registration statement are distributed in an underwritten offering, we anticipate that additional expenses will be incurred. An estimate of the aggregate expenses in connection with the issuance and distribution of securities being offered will be included in the applicable prospectus supplement.

 

We will bear all of the expenses shown above. All amounts are estimates except for the SEC registration fee.

 

Item 15. Indemnification of Directors and Officers.

 

Section 60 of the BCA provides that a corporation may indemnify directors and officers as well as other employees and individuals of such corporation against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement in connection with specified actions, suits and proceedings whether civil, criminal, administrative, or investigative, other than a derivative action by or in the right of the corporation, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe their conduct was unlawful. A similar standard is applicable in the case of derivative actions, except that indemnification extends only to expenses, including attorneys’ fees, incurred in connection with the defense or settlement of such action and the statute requires court approval before there can be any indemnification where the person seeking indemnification has been found liable to the corporation. The statute provides that it is not exclusive of other indemnification that may be granted by a corporation’s bylaws, disinterested director vote, stockholder vote, agreement or otherwise.

 

Our Amended and Restated Articles of Incorporation and Amended and Restated By-Laws provide for indemnification of directors and officers to the fullest extent permitted by law, including payment of expenses in advance of resolution of any such matter. Our Amended and Restated Articles of Incorporation eliminates the potential personal monetary liability of our directors to the Company or its stockholders for breaches of their duties as directors except as otherwise required under the BCA.

 

In addition, we have entered into separate indemnification agreements with certain of our directors and officers. Each indemnification agreement provides, among other things, for indemnification to the fullest extent permitted by law against any and all expenses, judgments, fines, penalties and amounts paid in settlement of any claim. The indemnification agreements also provide for the advancement or payment of all expenses to the indemnitee and for reimbursement to us if it is found that such indemnitee is not entitled to such indemnification under applicable law.

 

Section 60(7) of the BCA provides that a corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director or officer of the corporation against any liability asserted against the person in any such capacity, or arising out of the person’s status as such, whether or not the corporation would have the power to indemnify the person against such liability under the provisions of the BCA. We maintain insurance policies that provide coverage to our directors and officers against certain liabilities.

 

  II- 1  

 

 

Item 16. Exhibits and Financial Statement Schedules .

 

(a) Exhibits: The list of exhibits is set forth beginning on page II-6 of this Registration Statement and is incorporated herein by reference.

 

 

Item 17. Undertakings .

 

Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the “Securities Act”) may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

 

The un dersigned Registrant hereby undertakes:

 

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

 

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

 

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.

 

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

 

provided , however , that paragraphs (1)(i), (1)(ii) and (1)(iii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the Registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

 

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

 

(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

 

  II- 2  

 

 

(i) Each prospectus filed by the Registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

 

(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of the registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided , however , that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

 

(5) That, for the purpose of determining liability of the Registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, each undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

(i) Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424;

 

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of such undersigned Registrant or used or referred to by the undersigned Registrant;

 

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and

 

(iv) Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser.

 

(6) That, for purposes of determining any liability under the Securities Act of 1933, each filing of International Seaways, Inc.’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

  II- 3  

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on May 14, 2018.

 

  INTERNATIONAL SEAWAYS, INC.
   
  By: /s/ Lois K. Zabrocky
    Lois K. Zabrocky
    President and Chief Executive Officer

 

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.

 

Name  

Title

 

Date

         
/s/ Lois K. Zabrocky   President and Chief Executive Officer   May 14, 2018
Lois K. Zabrocky   (principal executive officer)    
         
/s/ Jeffrey D. Pribor   Senior Vice President and   May 14, 2018
Jeffrey D. Pribor   Chief Financial Officer
(principal financial and accounting officer)
   
         
*   Chairman of the Board of Directors   May 14, 2018
Douglas D. Wheat        
         
*   Director   May 14, 2018
Timothy J. Bernlohr        
         
*   Director   May 14, 2018
Ian T. Blackley        
         
*   Director   May 14, 2018
Randee E. Day        
         
*   Director   May 14, 2018
David I. Greenberg        
         
*   Director   May 14, 2018
Joseph I. Kronsberg        
         
*   Director   May 14, 2018
Ty E. Wallach        
         
*   Director   May 14, 2018
Gregory A. Wright        

 

*By: /s/ James D. Small III  
  James D. Small III  
  Attorney-in-fact  

   

  II- 4  

 

 

EXHIBIT INDEX

 

Exhibit Number   Description
1.1***   Form of Underwriting Agreement.
     
2.1   Separation and Distribution Agreement, dated November 30, 2016, by and between Overseas Shipholding Group, Inc. and International Seaways, Inc. (filed as Exhibit 2.1 to International Seaways, Inc.’s Current Report on Form 8-K dated December 2, 2016 and incorporated herein by reference).
     
2.2*   Stock Purchase and Sale Agreement, dated April 18, 2018, by and among Euronav NV, Euronav MI Inc., and Seaways Holding Corporation (pursuant to Item 601(b)(2) of Regulation S-K, certain schedules and similar attachments have been omitted but will be furnished supplementally to the Commission upon request)
     
2.3*   Guarantee of International Seaways, Inc., dated April 18, 2018, in favor of Euronav MI Inc.
     
3.1   Amended and Restated Articles of Incorporation of International Seaways, Inc. (filed as Exhibit 3.1 to International Seaways, Inc.’s Current Report on Form 8-K dated December 2, 2016 and incorporated herein by reference).
     
3.2   Amended and Restated By-Laws of International Seaways, Inc. (filed as Exhibit 3.2 to International Seaways, Inc.’s Current Report on Form 8-K dated December 2, 2016 and incorporated herein by reference).
     
4.1   Registration Rights Agreement, dated as of November 30, 2016, between the International Seaways, Inc. and certain stockholders party thereto (filed as Exhibit 4.1 to International Seaways, Inc.’s Current Report on Form 8-K dated December 2, 2016 and incorporated herein by reference).
     
4.2*   Form of Senior Debt Indenture.
     
4.3*   Form of Subordinated Debt Indenture.
     
5.1**   Opinion of Reeder & Simpson, P.C.
     
5.2**   Opinion of Cleary Gottlieb Steen & Hamilton LLP.
     
10.1   International Seaways, Inc. Non-Employee Director Incentive Compensation Plan (filed as Exhibit 10.2 to International Seaways, Inc.’s Current Report on Form 8-K dated November 25, 2016 and incorporated herein by reference).
     
10.1.1   Form of International Seaways, Inc. Non-Executive Director Incentive Compensation Plan Restricted Stock Grant Agreement (filed as Exhibit 10.1.1 to the Registrant’s Annual Report on Form 10-K for 2016 and incorporated herein by reference).
     
10.2   International Seaways, Inc. Management Incentive Plan (filed as Exhibit 10.1 to International Seaways, Inc.’s Current Report on Form 8-K dated November 25, 2016 and incorporated herein by reference).
     
10.2.1   Form of International Seaways, Inc. Management Incentive Compensation Plan Stock Option Grant Agreement (filed as Exhibit 10.2.1 to the Registrant’s Annual Report on Form 10-K for 2016 and incorporated herein by reference).
     
10.2.2   Form of International Seaways, Inc. Management Incentive Compensation Plan Restricted Stock Unit Grant Agreement (filed as Exhibit 10.2.2 to the Registrant’s Annual Report on Form 10-K for 2016 and incorporated herein by reference).
     
10.2.3   Form of International Seaways, Inc. Management Incentive Compensation Plan Performance-Based Restricted Stock Unit Grant Agreement (filed as Exhibit 10.2.3 to the Registrant’s Annual Report on Form 10-K for 2016 and incorporated herein by reference).

 

  II- 5  

 

 

Exhibit Number   Description
10.3   Credit Agreement dated as of June 22, 2017, among the Registrant, OIN Delaware LLC, International Seaways Operating Corporation and certain of its subsidiaries as other guarantors, various lenders, Jefferies Finance LLC and JP Morgan Chase Bank, N.A., as joint lead arrangers, UBS Securities LLC, as joint bookrunner, DNB Markets Inc., Fearnley Securities AS, Pareto Securities Inc. and Skandinaviska Enskilda Banken AB (Publ) as co-managers, Jefferies Finance LLC, as administrative agent, syndication agent, collateral agent and mortgage trustee (“2017 Credit Agreement”) (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the period ended June 30, 2017 and incorporated herein by reference).
     
10.4   First Amendment, dated as of July 24, 2017, to the 2017 Credit Agreement (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the period ended June 30, 2017 and incorporated herein by reference).
     
10.5   Employee Matters Agreement, dated November 30, 2016, between Overseas Shipholding Group, Inc. and International Seaways, Inc. (filed as Exhibit 10.2 to International Seaways, Inc.’s Current Report on Form 8-K dated December 2, 2016 and incorporated herein by reference).
     
10.6   Employment Agreement dated September 29, 2014 between Overseas Shipholding Group, Inc. and Lois K. Zabrocky (filed as Exhibit 10.13 to Overseas Shipholding Group, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference).
     
10.7   Amendment No. 1 to Lois K. Zabrocky’s Employment Agreement dated March 30, 2016 (filed as Exhibit 10.2 to Overseas Shipholding Group, Inc.’s Current Report on Form 8-K dated April 5, 2016 and incorporated herein by reference).
     
10.8   Amendment No. 2 to Lois K. Zabrocky’s Employment Agreement dated August 3, 2016 (filed as Exhibit 10.10 to International Seaways, Inc.’s Amendment No. 4 to the Registration Statement on Form 10-K, dated November 4, 2016 and incorporated herein by reference).
     
10.9   Form of Amendment No. 3 to Lois K. Zabrocky’s Employment Agreement (filed as Exhibit 10.8 to International Seaways, Inc.’s Amendment No. 2 to the Registration Statement on Form 10-K dated October 21, 2016 and incorporated herein by reference).
     
10.10**   Amendment No. 4 to Lois K. Zabrocky's Employment Agreement dated April 4, 2018.
     
10.11   Employment Agreement dated February 13, 2015 between Overseas Shipholding Group, Inc. and James D. Small III (filed as Exhibit 10.29 to Overseas Shipholding Group, Inc.’s Annual Report on Form 10-K for 2014 and incorporated herein by reference).
     
10.12   Amendment No. 1 to James D. Small III’s Employment Agreement dated March 30, 2016 (filed as Exhibit 10.4 to Overseas Shipholding Group, Inc.’s Current Report on Form 8-K dated April 5, 2016 and incorporated herein by reference).
     
10.13   Amendment No. 2 to James D. Small III’s Employment Agreement dated August 3, 2016 (filed as Exhibit 10.14 to International Seaways, Inc.’s Amendment No. 4 to the Registration Statement on Form 10-K, dated November 4, 2016 and incorporated herein by reference).
     
10.14   Form of Amendment No. 3 to James D. Small’s Employment Agreement (filed as Exhibit 10.9 to International Seaways, Inc.’s Amendment No. 2 to the Registration Statement on Form 10-K dated October 21, 2016 and incorporated herein by reference).
     
10.15   Employment Agreement dated September 29, 2014 between Overseas Shipholding Group, Inc. and Adewale O. Oshodi (filed as Exhibit 10.23 to Overseas Shipholding Group, Inc.’s Annual Report on Form 10-K for 2014 and incorporated herein by reference).
     
10.16   Amendment No. 1 to Adewale O. Oshodi’s Employment Agreement dated March 2, 2015 (filed as Exhibit 10.24 to Overseas Shipholding Group, Inc.’s Annual Report on Form 10-K for 2014 and incorporated herein by reference).

 

  II- 6  

 

 

Exhibit Number   Description
10.17   Amendment No. 2 to Adewale O. Oshodi’s Employment Agreement dated March 2, 2015 (filed as Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 and incorporated herein by reference).
     
10.18   Employment Agreement dated November 9, 2016 between International Seaways, Inc. and Jeffrey D. Pribor (filed as Exhibit 10.20 to International Seaways, Inc.’s Amendment No. 6 to the Registration Statement on Form 10 dated November 9, 2016 and incorporated herein by reference).
     
10.19   International Seaways Ship Management LLC Supplemental Executive Savings Plan (filed as Exhibit 10.18 to International Seaways, Inc.’s Annual Report on Form 10-K for 2017 and incorporated herein by reference).
     
10.20   Letter of Intent dated December 20, 2017 between Euronav NV and Registrant relating to Registrant’s purchase of all the issued and outstanding shares of Gener8 Maritime Subsidiary VII Inc (filed as Exhibit 10.19 to International Seaways, Inc.’s Annual Report on Form 10-K for 2017 and incorporated herein by reference). 
     
10.21*   $220 Million Senior Secured Credit Facility of TI Africa Limited and TI Asia Limited, as joint and several Borrowers, and ABN Amro Bank N.V. and ING Belgium SA/NV, as Mandated Lead Arrangers, dated March 29, 2018
     
10.22*   Guarantee, dated March 29, 2018, Relating to $220 Million Senior Secured Credit Facility dated March 29, 2018
     
12*   Statement on the Computation of Ratio of Earnings to Fixed Charges.
     
21.1   List of significant subsidiaries (filed as Exhibit 21 to International Seaways, Inc.’s Annual Report on Form 10-K for 2017 and incorporated herein by reference).
     
23.1*   Consent of PricewaterhouseCoopers LLP.
     
23.2**   Consent of Reeder & Simpson, P.C. (included in Exhibit 5.1).
     
23.3*   Consent of Ernst & Young LLP.
     
23.4**   Consent of Cleary Gottlieb Steen & Hamilton LLP (included in Exhibit 5.2).
     
24.1* *   Power of Attorney (included on signature page).
     
25.1**   Statement of Eligibility of The Bank of New York Mellon on Form T-1 under the Trust Indenture Act of 1939, as amended, with respect to the form of the Senior Debt Indenture.
     
25.2**   Statement of Eligibility The Bank of New York Mellon on Form T-1 under the Trust Indenture Act of 1939, as amended, with respect to the form of the Subordinated Debt Indenture.

 

 

 

* Filed herewith.
** Previously filed.
*** To be filed, if applicable, by amendment or by a report filed under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, and incorporated herein by reference.

 

  II- 7  

 

Exhibit 2.2

 

Execution Version

 

STOCK PURCHASE AND SALE AGREEMENT

 

This STOCK PURCHASE AND SALE AGREEMENT (this “ Agreement ”) is made as of April 18, 2018 by and among Euronav NV, a corporation incorporated and existing under the laws of the Kingdom of Belgium (“ Seller Parent ”), Euronav MI Inc., a corporation incorporated and existing under the Laws of the Republic of the Marshall Islands (together with any successor thereto, “ Seller ”), and Seaways Holding Corporation, a corporation incorporated and existing under the Laws of the Republic of the Marshall Islands (“ Purchaser ”). Capitalized terms used in this Agreement, to the extent not defined elsewhere herein, shall have the meanings set forth on Annex A .

 

WHEREAS, Seller Parent, Seller and Gener8 Maritime, Inc. (“ Gener8 ”), have entered into that certain Agreement and Plan of Merger, dated as of December 20, 2017 (the “ Merger Agreement ”), pursuant to which Seller shall merge with and into Gener8, with Gener8 as the surviving corporation (the “ Merger ”);

 

WHEREAS, upon the closing of the transactions contemplated by the Merger Agreement (the “ Gener8 Closing ”), Gener8 (as the surviving corporation of the Merger and having become the successor to all obligations of Seller, including under this Agreement) shall own, legally and beneficially, one hundred percent (100%) of the issued and outstanding capital stock (the “ Shares ”) of Gener8 Maritime Subsidiary VII Inc., a corporation incorporated and existing under the laws of the Republic of the Marshall Islands (“ Holdco ”);

 

WHEREAS, Holdco owns, legally and beneficially, one hundred percent (100%) of the issued and outstanding membership interests (the “ Interests ”) of the entities set forth on Annex B under the heading “Company” (each such entity, a “ Company ” and collectively, the “ Companies ” and, together with Holdco, the “ Acquired Entities ”), each of which owns the vessel set forth opposite the name of such Company on Annex B (together with the respective spare parts and stores onboard, each a “ Vessel ” and collectively, the “ Vessels ”);

 

WHEREAS, following the Gener8 Closing, Seller desires that Gener8 (as successor to Seller) sell to Purchaser, and Purchaser wishes to purchase, or cause its nominee to purchase, the Shares, all upon the terms and subject to the conditions herein contained (when used herein with respect to any covenant or obligation intended to occur after the Gener8 Closing, the term “Seller” shall mean Gener8 as the surviving corporation of the Merger and successor to Seller); and

 

WHEREAS, concurrently with the execution and delivery of this Agreement, Seller Parent and an affiliate of Purchaser are executing and delivering a memorandum of agreement for the sale of the Seaways Laura Lynn (the “ Laura Lynn MOA ”).

 

NOW, THEREFORE, in consideration of the mutual covenants described below and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto hereby covenant and agree as follows:

 

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Section 1.                Purchase and Sale of the Shares .

 

1.1           At the closing of the transactions contemplated herein (the “ Closing ”) and upon the terms and conditions hereinafter set forth, Seller shall deliver and sell the Shares to Purchaser, and Purchaser shall purchase the Shares, free and clear of all Liens (other than Liens securing the obligations under the Facility Agreement), for Four Hundred Thirty Four Million US Dollars ($434,000,000), less Estimated Net Debt (as defined below) (such net amount, the “ Estimated Purchase Price ”), which shall be subject to adjustment pursuant to Section 1.2 and Section 1.3 . Subject to the provisions of Section 5 , the Closing shall take place: (a) in New York City at the offices of Seward & Kissel LLP, One Battery Park Plaza, New York, NY 10004 as soon as possible but no later than three Business Days following the Gener8 Closing, subject to the satisfaction or, to the extent permissible, waiver of the conditions set forth in Section 5 (other than those conditions that by their terms cannot be satisfied until the Closing, it being understood that the occurrence of the Closing shall remain subject to the satisfaction or waiver in writing of such conditions at the Closing); or (b) at such other place, at such other time or on such other date as Purchaser and Seller may mutually agree in writing. The date on which the Closing actually takes place is referred to as the “ Closing Date ”.

 

1.2           Not less than three Business Days prior to the Closing Date, Seller shall use its reasonable commercial efforts to prepare and deliver to Purchaser a written statement certified by an officer of Seller setting forth Seller’s good faith estimate (the “ Closing Estimate ”) of (i) Closing Net Debt (the “ Estimated Net Debt ”), and (ii) the Estimated Purchase Price. Seller agrees it shall prepare the Closing Estimate in accordance with, as applicable, the definitions of “Closing Net Debt” and “Estimated Purchase Price” set forth herein and, in the case of the Estimated Net Debt, the Accounting Principles, and each of Seller and Seller Parent shall deliver, together with the Closing Estimate, any supporting documentation and additional information as may be reasonably requested by Purchaser with respect to the amounts set forth in the Closing Estimate. Seller shall consult in good faith with Purchaser in the preparation of the Closing Estimate, shall use its reasonable commercial efforts to provide Purchaser with a draft thereof showing the components of Estimated Net Debt (together with any supporting work papers) at least six Business Days prior to the Closing Date, and shall consider in good faith any comments provided by Purchaser prior to preparing the final calculation of the Estimated Purchase Price. From the delivery of such draft until the Settlement Date (as defined below), each of Seller and Seller Parent shall use its respective reasonable commercial efforts to, and to cause Gener8 to, (and after the Gener8 Closing they shall cause Gener8 to) at no cost to Purchaser, (x) afford Purchaser and its Representatives reasonable access, upon reasonable advance notice during normal business hours, to the Books and Records of Gener8, Seller and the Acquired Entities as and to the extent reasonably necessary for Purchaser to review the Closing Estimate and (y) provide Purchaser with any other documentation or information that is readily available to Seller and reasonably requested by Purchaser in connection with such activities.

 

1.3           Within sixty days after the Closing Date, Seller shall prepare and deliver to Purchaser a written statement certified by an officer of Seller (the “ Closing Statement ”) setting forth in reasonable detail Seller’s proposed final calculation of Closing Net Debt, the Closing Net Asset Amount and the Purchase Price. Seller agrees that it shall prepare the Closing Statement in accordance with, as applicable, the definitions of “Closing Net Debt,” “Closing Net Asset Amount” and “Purchase Price” set forth herein and, in the case of Closing Net Debt and Closing Net Asset Amount, the Accounting Principles, and Seller shall deliver, together with the Closing Statement, any supporting documentation and additional information as may be reasonably requested by Purchaser with respect to the amounts set forth therein. From the date of Seller’s delivery of the Closing Statement to the Settlement Date, Seller shall, at no cost to Purchaser, (i) afford Purchaser and its Representatives reasonable access, upon reasonable advance notice during normal business hours, to the Books and Records of Seller and the Acquired Entities as and to the extent reasonably necessary for Purchaser to confirm Seller’s calculation of the Purchase Price, (ii) make available to Purchaser, upon reasonable advance notice during normal business hours, any employee who was involved in the preparation of the Closing Statement and (iii) provide Purchaser with any other documentation or information that is readily available to Seller and reasonably requested by Purchaser to confirm the Closing Statement.

 

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1.4           On or prior to the forty-fifth day following Seller’s delivery of the Closing Statement, Purchaser may deliver Seller a written notice stating in reasonable detail Purchaser’s objections, if any, to the Closing Statement (if delivered, an “ Objection Notice ”). The Objection Notice shall specify in reasonable detail the dollar amount of any objection and the basis therefor (and shall include Purchaser’s proposed changes to the calculations). If Purchaser does not deliver Seller an Objection Notice by the end of such period, then the Closing Statement shall be deemed final and binding upon Purchaser and Seller and the Purchase Price set forth in the Closing Statement shall become the Purchase Price for all purposes under this Agreement.

 

1.5           Following Seller’s receipt of the Objection Notice, if any, Seller and Purchaser shall attempt to negotiate in good faith to resolve such dispute. If Seller and Purchaser fail to resolve any of Purchaser’s proposed adjustments set forth in such Objection Notice within twenty days after Seller’s receipt thereof, Seller and Purchaser agree that a mutually acceptable third-party accounting firm, to be jointly selected by Seller and Purchaser, the retention of which will not give rise to present or potential future auditor independence problems for Seller Parent or International Seaways, Inc., as determined in the reasonable discretion of Seller and Purchaser (such firm, the “ Dispute Accountants ”), shall make the final determination as to any such unresolved adjustments in accordance with the terms of this Agreement. The parties shall instruct the Dispute Accountants to consider those items and amounts set forth in the Closing Statement as to which Purchaser has disagreed pursuant to an Objection Notice and Purchaser and Seller have not resolved their disagreement (and any necessary items, amounts or information related thereto). The scope of the disputes to be resolved by the Dispute Accountants shall be limited to whether such calculation was done in accordance with the terms hereof and the Accounting Principles, and whether there were mathematical errors in the calculation of the Closing Statement, and the Dispute Accountants shall not make any other determination. The Dispute Accountants shall make their determination based solely on written submissions, presentations and supporting material provided by Purchaser and Seller and not pursuant to any independent review. In resolving any such disagreement, the Dispute Accountants may not assign a value to any item greater than the greatest value for such item claimed by Seller in the Closing Statement or by Purchaser in the Objection Notice or less than the lowest value for such item claimed by Seller in the Closing Statement or by Purchaser in the Objection Notice. Purchaser and Seller shall use commercially reasonable efforts to cause the Dispute Accountants to deliver to the parties, as promptly as practicable, a written report setting forth the resolution of any such disagreement determined in accordance with the terms of this Agreement. The determination by the Dispute Accountants in such report shall be final and binding on the parties for all purposes under this Agreement. The fees, costs and expenses of the Dispute Accountants arising in connection herewith shall be borne by the parties in such proportion to reflect the relative amount of each party’s determination that has been modified pursuant to the Dispute Accountants’ report and the Dispute Accountants shall include such allocation in their report.

 

  3  

 

 

1.6           Upon final agreement or determination (by agreement of Seller and Purchaser and/or by determination of the Dispute Accountants) of the amounts reflected in the Closing Statement (the Closing Statement with such amounts as finally so determined being referred to as the “ Final Closing Statement ” and the date upon which such final agreement or determination of the amounts reflected therein is made, the “ Settlement Date ”), an adjustment of the price payable hereunder shall be calculated as follows: (a) if Closing Net Debt as reflected in the Final Closing Statement exceeds the Estimated Net Debt, then there shall be a negative adjustment in the amount of such excess; or if Closing Net Debt as reflected in the Final Closing Statement is less than the Estimated Net Debt, then there shall be a positive adjustment in the amount of such shortfall, and (b) if the Closing Net Asset Amount as reflected in the Final Closing Statement is a positive amount, then there shall be a positive adjustment in such amount; or if the Closing Net Asset Amount is a negative amount, then there shall be a negative adjustment in such amount. The net adjustment resulting from the calculations in (a) and (b) above (the “ Adjustment ”) shall be paid by Seller to Purchaser if negative and by Purchaser to Seller if positive (as the case may be) in cash in immediately available funds within five Business Days after the Settlement Date. The Estimated Purchase Price plus or minus the Adjustment (as the case may be) shall be referred to herein as the “ Purchase Price ”.

 

Section 2.                Delivery of the Shares and Payment of Purchase Price . At the Closing:

 

2.1           Seller shall cause indefeasible delivery and transfer of the Shares, free and clear of all Liens (other than Liens securing the obligations under the Facility Agreement), to Purchaser or its nominee directly.

 

2.2           Purchaser shall deliver to Seller the full amount of the Estimated Purchase Price for the Shares by wire transfer of immediately available funds to an account or accounts specified in advance in writing by Seller.

 

2.3           The parties acknowledge that Seller may cause Holdco and the Companies to distribute all Cash and Cash Equivalents of Holdco and the Companies, other than Cash and Cash Equivalents held in the Debt Service Reserve Account or Minimum Liquidity Account, to Seller or its Affiliates at or prior to Closing.

 

2.4           Seller shall cause Holdco and/or the Companies to be the sole beneficial and record owners of the Debt Service Reserve Account and the Minimum Liquidity Account at the Closing.

 

Section 3.                Representations and Warranties of Seller and Seller Parent . Each of Seller and Seller Parent hereby represents and warrants to Purchaser as of the date hereof and as of the Closing Date, as follows:

 

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3A.          Representations and Warranties with Respect to Seller and Seller Parent .

 

3A.1      Organization, Qualification and Power .

 

(a)              Seller is a corporation, duly organized, validly existing and in good standing under the Laws of the Republic of the Marshall Islands. Seller has the power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement, including the sale and delivery of the Shares to Purchaser.

 

(b)             Seller Parent is a corporation duly organized, validly existing and in good standing under the Laws of the Kingdom of Belgium. Seller Parent has the corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement.

 

3A.2      Authorization. The execution, delivery and performance of this Agreement by each of Seller and Seller Parent and the consummation by each of Seller and Seller Parent of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Seller or Seller Parent, as applicable, and this Agreement constitutes a legal, valid and binding obligation of Seller or Seller Parent, as the case may be, enforceable against such party in accordance with its terms, except as such enforceability may be limited by: (a) applicable bankruptcy, reorganization, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally; and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at Law).

 

3A.3      Ownership of Seller . Seller Parent is the sole direct or indirect beneficial and record owner of one hundred percent (100%) of the issued and outstanding capital stock of Seller.

 

3A.4      No Legal Prohibition . Neither Seller nor Seller Parent is a party to, subject to or bound by any agreement (other than the Facility Agreement) or any Order that would prevent the execution or delivery of this Agreement by Seller or at the Closing prevent the transfer, conveyance and sale of the Shares to be sold by Seller to Purchaser pursuant to the terms hereof.

 

3A.5      Noncontravention .

 

(a)              None of the execution, delivery and performance of this Agreement by Seller or Seller Parent nor the consummation of any of the transactions contemplated hereunder by Seller or Seller Parent will, directly or indirectly, (i) contravene, conflict with or result in any violation of or constitute a breach of any of the terms or provisions of their respective articles of incorporation or bylaws, (ii) contravene, conflict with or result in a violation or breach of any Law applicable to Seller or Seller Parent, or (iii) except as set forth on Schedule 3A.5 of the Seller Disclosure Schedules, contravene, conflict with or result in a violation or breach of any provision of, result in the loss of any benefit or the imposition of any additional payment or other Liability under, give any Person the right to declare a default or exercise any remedy under, to accelerate the maturity or performance of, or to cancel, terminate, redeem or modify, with or without notice or lapse of time or both, any material Contract to which Seller or Seller Parent or any of their Affiliates (excluding Holdco and/or any Company) is a party or is bound.

 

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(b)              None of the execution, delivery or performance by Seller or Seller Parent of this Agreement nor the consummation by Seller or Seller Parent of any of the transactions contemplated hereunder will require any consents or approvals or other Governmental Authorizations of, or registrations, filings or declarations with, any Governmental Authority or any other Person, except (i) the Consents set forth on Schedule 3A.5(b) of the Seller Disclosure Schedules and (ii) such filings as may be required by any applicable securities Laws.

 

3A.6      Valid Title . Immediately prior to the Closing, Gener8 (as the surviving corporation of the Merger and successor to Seller’s obligations under this Agreement) will be the sole beneficial and record owner of, and will have good, valid and marketable title to, the Shares which are to be transferred to Purchaser by Seller pursuant hereto. Upon the consummation of the Closing, Purchaser will obtain good, valid and marketable title to all of the Shares, free and clear of all Liens (other than Liens securing the obligations under the Facility Agreement).

 

3A.7      Litigation . Except as set forth on Schedule 3A.7 of the Seller Disclosure Schedules, there are no material actions, suits, or other Legal Proceedings before or by any Governmental Authority pending or, to Seller’s or Seller Parent’s knowledge, threatened against Seller or Seller Parent or against any of the properties or assets of Seller or Seller Parent that would prohibit Seller’s or Seller Parent’s performance of this Agreement or the consummation of the transactions contemplated hereunder.

 

3A.8      Brokers . No broker, finder or investment banker has acted for Seller or any of its Affiliates in connection with this Agreement or the transactions contemplated hereby, and no broker, finder or investment banker is entitled to any brokerage or finder’s fee or other commissions in respect of such transactions based upon agreements, arrangements or understandings made by or on behalf of Seller or any of its Affiliates.

 

3B.          Representations and Warranties with Respect to the Acquired Entities .

 

3B.1       Organization, Qualification and Power .

 

(a)              Holdco is a corporation, validly existing and in good standing under the Laws of the Republic of the Marshall Islands. Holdco has the corporate power and authority to own or hold under lease and to operate the assets it owns, and to conduct its business as it is now being conducted, and has the corporate power and authority to execute and deliver any instruments or documents as required by this Agreement and to perform its obligations thereunder.

 

(b)              Each Company is a limited liability company, validly existing and in good standing under the Laws of the Republic of the Marshall Islands. Each Company has the limited liability company power and authority to own or hold under lease and to operate the assets it owns, and to conduct its business as it is now being conducted, and has the limited liability company power and authority to execute and deliver any instruments or documents as required by this Agreement and to perform its obligations thereunder.

 

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(c)              Seller has made available, or caused Gener8 to make available, to Purchaser, prior to the date hereof, copies of the articles of incorporation, bylaws, certificate of formation and limited liability company agreement, or other governing documents (collectively, the “ Organizational Documents ”) of each Acquired Entity. To the knowledge of Seller and Seller Parent, such Organizational Documents are in full force and effect, and none of Holdco or any Company is in violation thereof.

 

3B.2       Capitalization of Holdco and the Companies .

 

(a)              The Shares represent 100% of the authorized and outstanding capital stock of Holdco. All of the Shares (i) have been duly authorized and validly issued and are fully paid and nonassessable and (ii) have been issued and granted in compliance with all applicable Laws or pursuant to valid exemption therefrom.

 

(b)              Holdco is the sole direct or indirect beneficial and record owner of one hundred percent (100%) of the issued and outstanding Interests of each Company, free and clear of all Liens (other than Liens securing the obligations under the Facility Agreement).

 

(c)              Other than, in the case of Holdco, the Shares, and in the case of the Companies, the Interests, there are no outstanding securities of Holdco or any Company of any kind nor, to the knowledge of Seller and Seller Parent, are there any contractual rights held by any Person to cause the issuance of Shares, Interests or any other security by Holdco or any Company.

 

(d)              To the knowledge of Seller and Seller Parent, there are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or sale or transfer of any Shares, Interests, or other securities of Holdco or any Company.

 

3B.3       Title to Vessels; No Other Activities . Each Company is the sole owner of, and has good, valid and marketable title to, its respective Vessel (including all her spare parts, whether on board or not as of the Closing Date). There are no Liens of any kind whatsoever on any property owned by Holdco or the Companies other than (a) the lien with respect to each Vessel conferred under a first preferred ship mortgage (the “ Mortgage ”) granted by each Company to Nordea Bank Finland Plc, New York Branch (“ Nordea ”), as security trustee, in connection with the Facility Agreement, and (b) any maritime liens incurred in the ordinary course of business and relating to amounts that are not yet due and payable and any other lien permitted by each Mortgage (“ Permitted Liens ”). Other than with respect to the Existing Contracts (as defined below), neither Holdco nor any Company has any Indebtedness or other Liabilities, matured or unmatured, direct or contingent. To the knowledge of Seller and Seller Parent, neither Holdco nor any Company engages in any business activities or conducts any operations, nor has Holdco or any Company previously engaged in any business activities or conducted any operations, other than those business activities and operations expressly contemplated by this Agreement in connection with the Vessels, the Debt Service Reserve Account, the Minimum Liquidity Account and the Existing Contracts.

 

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3B.4       Existing Contracts . Upon completion of the Closing, neither Holdco nor any Company shall, to the knowledge of Seller and Seller Parent, be a party to any management agreement, administrative services agreement or any other material Contract, license, obligation, lease, agreement, commitment or the like, written or oral, other than the Contracts set forth on Schedule 3B.4 of the Seller Disclosure Schedules, which lists, among others: (a) the Pool Agreements (and the charters entered into in conjunction therewith), (b) the Facility Agreement and related Finance Documents (as defined in the Facility Agreement), (c) the technical management agreements entered into by an Acquired Entity relating to its Vessel, and (d) the protection and indemnity, hull and machinery and war risk insurance policies and club entries covering such Vessels for acts prior to the Closing (the Contracts to be listed on Schedule 3B.4 of the Seller Disclosure Schedules, collectively, the “ Existing Contracts ”). To the knowledge of Seller and Seller Parent, each of the Existing Contracts is valid, binding and enforceable against the Acquired Entity or Acquired Entities to which it applies and the other parties thereto, and is in full force and effect in accordance with its terms, except insofar as enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally or (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at Law). To the knowledge of Seller and Seller Parent, no event has occurred which, with or without notice, lapse of time or both, would constitute a breach or default under any Existing Contract.

 

3B.5       Labor and Employees . Neither Holdco nor the Companies have any employees nor, to the knowledge of Seller and Seller Parent, have they had any employees since their inception.

 

3B.6       Taxation .

 

(a)              To the knowledge of Seller and Seller Parent, (i) all material Tax Returns required to be filed by, or with respect to, Holdco and each Company prior to the date hereof have been duly and timely filed; (ii) all such Tax Returns were true, correct and complete in all material respects; (iii) all material Taxes (whether or not shown on a Tax Return) required to be paid under applicable Law by Holdco or any Company have been timely paid; (iv) no Tax examination, audit or proceeding is currently being conducted with respect to Holdco or any Company; (v) there is no outstanding request in writing with respect to Holdco or any Company for any extension of time within which to pay any Taxes or to file any Tax Returns; (vi) neither Holdco nor any Company has waived in writing any statute of limitations of assessment or collection in respect of any Taxes (other than a waiver that has expired or terminated); (vii) there are no liens for any Tax on the assets of Holdco or any Company; and (viii) no material Liability for any Taxes outside such entity’s ordinary course of business has been incurred since December 31, 2017.

 

(b)              To the knowledge of Seller and Seller Parent, no claim has ever been made by a Tax Authority in any jurisdiction where Holdco or any Company, as the case may be, does not file Tax Returns that such entity is required to file Tax Returns in such jurisdiction.

 

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(c)              Neither Holdco nor any Company is or has been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Internal Revenue Code of 1986, as amended (the “ Code ”) during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code and Purchaser is not required to withhold Taxes on the purchase of the Shares by reason of Section 1445 of the Code.

 

(d)              Neither Holdco nor any Company is a party to or bound by any contract, plan or arrangement covering any employee or former employee, nor is there any agreement (including this Agreement) that Holdco or any Company is a party to that under any circumstances could obligate Holdco or any Company, to make payments to an employee or former employee that, individually or in the aggregate, could give rise to any payment (nor have any payments been made) that would not be deductible pursuant to Section 162 or 280G of the Code.

 

(e)              To the knowledge of Seller and Seller Parent, (i) neither Holdco nor any Company has ever been a member of an affiliated group filing a consolidated United States federal income Tax Return, (ii) neither Holdco nor any Company is a party to any tax allocation, tax sharing or tax indemnification agreement or similar contract or arrangement, whether formal or informal and (iii) neither Holdco nor any Company has any liability for Taxes of any other Person under the Code or any other law, as a transferee or successor, by contract or otherwise.

 

3B.7       No Other Representations or Warranties . Other than the representations and warranties expressly contained in this Section 3 , neither Seller nor Seller Parent makes any representations or warranties, express or implied, relating to the Shares, the Vessels, the transactions contemplated hereby or any other matters, and any such other representation or warranty is hereby disclaimed and has not been relied upon by Purchaser. Purchaser hereby acknowledges that in making the representations and warranties in this Section 3 with respect to the Acquired Entities, Seller and Seller Parent have relied upon the representations and warranties made by Gener8 under the Merger Agreement and Seller’s and Seller Parent’s limited due diligence of the Acquired Entities in connection therewith. Notwithstanding the foregoing, nothing in this Section 3B.7 is intended to impede a claim for fraud.

 

Section 4.                Representations and Warranties of Purchaser . Purchaser represents and warrants to Seller as of the date hereof and as of the Closing Date that:

 

4.1            Organization and Power . Purchaser is a corporation, duly organized, validly existing and in good standing under the Laws of the Republic of the Marshall Islands. Purchaser has the power and authority to conduct its business as it is now being conducted and Purchaser has the power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement.

 

4.2            Authorization . The execution, delivery and performance by Purchaser of this Agreement, and the consummation by Purchaser of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of Purchaser, and this Agreement constitutes the legal, valid and binding obligation of Purchaser enforceable against Purchaser in accordance with its terms, except as such enforceability may be limited by: (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally; and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at Law).

 

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4.3           Noncontravention .

 

(a)              None of the execution, delivery and performance by Purchaser of this Agreement nor the consummation by Purchaser of any of the transactions contemplated hereunder will, directly or indirectly, (i) contravene, conflict with or result in any violation of or constitute a breach of any of the terms or provisions of the articles of incorporation, the by-laws or other organizational documents of Purchaser and (ii) assuming that all consents, approvals, authorizations and permits described in Section 4.3(b) have been obtained and all filings and notifications described in Section 4.3(b) have been made, contravene, conflict with or violate any Law applicable to Purchaser.

 

(b)              None of the execution, delivery and performance by Purchaser of this Agreement nor the consummation by Purchaser of any of the transactions contemplated hereunder will require any consents or approvals or authorizations of, or registrations, filings or declarations with, any Governmental Authority or any other Person, except (i) Consents with respect to the Term Loan B Facility and (ii) such filings as may be required by any applicable securities Laws.

 

4.4           Brokers . Except for Jefferies Group LLC and Citibank, N.A., each of whose fees shall be payable by Purchaser or International Seaways, Inc., no broker, finder or investment bank has acted for Purchaser or any of its Affiliates in connection with this Agreement or the transactions contemplated hereby, and no broker, finder or investment bank is entitled to any brokerage or finder’s fee or other commissions in respect of such transactions based upon agreements, arrangements or understandings made by or on behalf of Purchaser or any of its Affiliates.

 

4.5           Adequate Resources . Purchaser will have, at the Closing, adequate cash resources available to it, when taken together (if necessary) with contemplated debt financing which has been identified to Seller, in order to make payment of the Purchase Price hereunder.

 

4.6           No Other Representations or Warranties . Other than the representations and warranties expressly contained in this Section 4 , Purchaser makes no representations or warranties, express or implied, relating to Purchaser or the transactions contemplated hereby or any other matters, and any such other representation or warranty is hereby disclaimed and has not been relied upon by Seller or Seller Parent. Notwithstanding the foregoing, nothing in this Section 4.6 is intended to impede a claim for fraud.

 

Section 5.              Conditions Precedent to Closing .

 

5.1           Conditions Precedent to Closing by Purchaser . The obligation of Purchaser to consummate the Closing is subject to the satisfaction (or written waiver by Purchaser, if permissible under applicable Law) of the following conditions precedent at or before the Closing:

 

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(a)              The representations and warranties made by Seller and Seller Parent in Section 3 hereof shall be true and correct in all material respects at the time of the Closing (without regard to any qualification therein as to materiality or “Material Adverse Effect”), with the same force and effect as if they had been made at and as of the time of the Closing (except for representations and warranties made as of a specified date, which shall be true and correct as of that specified date);

 

(b)              Each of Seller and Seller Parent shall have duly complied with and performed in all material respects all covenants and agreements of Seller herein which are required to be complied with or performed by it at or before the Closing;

 

(c)              All notifications, consents, authorizations, approvals and clearances from each Governmental Authority and any other Person required to be made or obtained, in connection with the transactions provided for in this Agreement shall have been made or obtained;

 

(d)              The Gener8 Closing shall have occurred on terms that do not materially impede, interfere with, prevent, delay or limit the economic benefit to Purchaser of the transactions contemplated by this Agreement;

 

(e)              Since December 31, 2017, there shall not have occurred any Material Adverse Effect, nor shall any Effect have occurred that, individually or in the aggregate, with or without the lapse of time, would reasonably be expected to result in a Material Adverse Effect;

 

(f)               Purchaser shall have been furnished with a certificate, dated as of the Closing Date and in form and substance satisfactory to Purchaser, executed by an authorized officer of each of Seller and Seller Parent, certifying to the fulfillment of the conditions specified in Section 5.1(a) , Section 5.1(b) and Section 5.1(e) hereof;

 

(g)              No later than five (5) Business Days prior to the Company Shareholders Meeting (as defined in the Merger Agreement), the lenders under Purchaser’s Term Loan B Facility shall have consented to the transactions contemplated by this Agreement, and/or to the financing necessary in connection therewith, and agreed to amend the Term Loan B Facility to the extent necessary in order to consummate the transactions contemplated by this Agreement, in each case on terms and conditions reasonably satisfactory to Purchaser, as contemplated by the definition of SPA Term Loan B Consent Notice or, if applicable, Sale and Repurchase Term Loan B Consent Notice;

 

(h)             Each Vessel inspected by Purchaser shall have been delivered to Purchaser as she was at the time of inspection by Purchaser, ordinary wear and tear excepted;

 

(i)               Seller shall have delivered to Purchaser one or more duly authorized and executed stock certificates representing the Shares along with corresponding duly executed stock powers in favor of Purchaser or its nominee, the corporate formation and corporate governance documents and all amendments, minute books, stock book, share registers and all other corporate records of each Company and of Holdco;

 

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(j)               Seller shall have delivered to Purchaser the documents and instruments set forth on Annex C ; and

 

(k)              There shall be no Order in effect that restrains, enjoins or otherwise prohibits the consummation of the Closing.

 

5.2           Conditions Precedent to Closing by Seller . The obligation of Seller to consummate the Closing is subject to the satisfaction (or written waiver by Seller, if permissible under applicable Law) of the following conditions precedent at or before the Closing:

 

(a)              The representations and warranties made by Purchaser in Section 4 hereof shall be true and correct all material respects at the time of the Closing (without regard to any qualification therein as to materiality or “Material Adverse Effect”), with the same force and effect as if they had been made at and as of the time of the Closing (except for representations and warranties made as of a specified date, which shall be true and correct as of that specified date);

 

(b)              Purchaser shall have duly complied with and performed in all material respects all covenants and agreements of Purchaser herein which are required to be complied with or performed by it at or before the Closing Date;

 

(c)              The Gener8 Closing shall have occurred;

 

(d)              The lenders under the Facility Agreement shall have consented to the transactions contemplated by this Agreement, unless Purchaser shall be prepared to pay off the debt under the Facility Agreement at the Closing;

 

(e)              Seller shall have been furnished with a certificate, dated as of the Closing Date, executed by an authorized officer of Purchaser, certifying to the fulfillment of the conditions specified in Section 5.2(a) through 5.2(b) hereof; and

 

(f)               There shall be no Order in effect that restrains, enjoins or otherwise prohibits the consummation of the Closing.

 

Section 6.                Covenants .

 

6.1            Reasonable Best Efforts . Each of Seller, Seller Parent and Purchaser shall use its respective reasonable best efforts to satisfy the conditions provided in Section 5.1 and Section 5.2 ; provided that no party shall be required to cause the occurrence of the condition specified in Section 5.1(d) or Section 5.2(c) to be satisfied.

 

6.2            Interim Covenant . Neither Seller nor Seller Parent will amend, modify or terminate or waive any provision set forth in the Merger Agreement, or otherwise take any action that would reasonably be expected to impede, interfere with, prevent, delay or limit the economic benefit to Purchaser of the transactions contemplated by this Agreement in the event that the Gener8 Closing occurs. Each of Seller and Seller Parent shall use its respective reasonable best efforts to cause Gener8 to comply with its obligations pursuant to Section 6.1 of the Merger Agreement. Neither Seller Parent nor Seller shall, without Purchaser’s prior written consent, waive any covenant or condition for its benefit under the Merger Agreement, to the extent such covenant or condition directly or indirectly relates to, or could reasonably be expected to affect the value of, any of the Vessels or Acquired Entities.

 

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6.3           Debt Consents and Financial Reporting Obligations . Each of Seller and Seller Parent shall use its respective reasonable best efforts to, and to cause Gener8 to provide Purchaser (i) as promptly as reasonably practicable following the date of the applicable request by Purchaser, such financial data, financial statements and/or financial information as Purchaser shall reasonably request for Purchaser and International Seaways, Inc. to be able to prepare (x) audited annual and unaudited quarterly historical financial statements regarding the Acquired Entities and (y) pro forma financial information regarding the Acquired Entities giving effect to the Closing, in each case only to the extent the same would be required to be filed with the SEC by Purchaser on a Current Report on Form 8-K in connection with the Closing pursuant to Item 9.01(a) or Item 9.01(b) thereof (such information as specified by Purchaser, the “ Required Financial Information ”) and (ii) such other cooperation and assistance as Purchaser shall reasonably request, including for the avoidance of doubt in connection with obtaining an unqualified audit opinion with respect to any required annual historical financial statements, in connection with the preparation of the Required Financial Information.

 

6.4           Tax Covenants .

 

(a)              Seller shall prepare or cause to be prepared and file or cause to be filed all Tax Returns for Holdco and each Company for all periods ending on or prior to the Closing Date which are filed after the Closing Date. Seller shall provide such Tax Returns to Purchaser for review and comment no later than thirty days prior to the date on which such Tax Return is required to be filed, and Seller shall incorporate Purchaser’s reasonable comments thereto. Seller shall pay to Purchaser all Taxes indicated as due and payable with respect to such periods no later than five days prior to the filing deadline for such Tax Return (except to the extent such Taxes have already been included in the calculation of the Closing Net Asset Amount). Holdco or the relevant Company, as the case may be, shall be credited for and shall be entitled to receive any refunds with respect to such Taxes.

 

(b)              Purchaser shall prepare and file, or cause to be prepared and filed, all Tax Returns for periods beginning before the Closing Date and ending after the Closing Date (a “ Straddle Period ”) for each of Holdco and the Companies, and shall cause Holdco and each such Company to pay any Taxes shown to be due thereon; provided, however, that to the extent any such Tax Return includes Pre-Closing Taxes, no later than five days prior to the filing of any such Tax Return, Seller shall pay to Purchaser (in immediately available funds and in the applicable currency) the amount of Pre-Closing Taxes reflected therein (except to the extent such Taxes have already been included in the calculation of the Closing Net Asset Amount). With respect to any Straddle Period, the portion of such Tax that relates to the portion of the Straddle Period ending on the Closing Date (the “ Pre-Closing Tax Straddle Period ”) shall, in the case of any, (i) real, personal and intangible personal Property Taxes of Holdco and each Company (“ Property Taxes ”) be equal to the amount of such property Taxes for the entire Straddle Period multiplied by a fraction, the numerator of which is the number of days in the Pre-Closing Tax Straddle Period and the denominator of which is the number of days in the Straddle Period; and (ii) Taxes of Holdco and/or each Company (other than Property Taxes), be equal to the amount that would be payable if such taxable period ended as of the close of business on the Closing Date.

 

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(c)              Purchaser, Holdco, each Company, Seller and Parent Seller shall cooperate fully, as and to the extent reasonably requested by the other parties, in connection with the filing of Tax Returns pursuant to Section 6.4 and in defending any audit, litigation or other proceeding with respect to Taxes of Holdco or any Company (a “ Tax Contest ”). Such cooperation shall include Purchaser, Holdco and each Company providing to Seller, or Seller or Seller Parent providing to Purchaser (as applicable), the same information as provided to auditors in connection with any Tax Contest at the same time that Purchaser, Holdco or such Company, or Seller or Seller Parent as the case may be, provides such information to auditors, the retention and (upon the other parties’ request) the provision of records and information that are reasonably relevant to any such Tax Contest and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder ; provided , however , that nothing herein shall require any party to provide information that is privileged if the disclosure is reasonably expected to result in the loss of such privilege. Each of Holdco and each Company agrees to (i) retain all Books and Records with respect to Tax matters pertinent to it relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by Purchaser or Seller, any extensions thereof) of the respective taxable periods, and to abide by all record retention agreements entered into with any Taxing Authority, and (ii) give the other parties reasonable written notice prior to transferring, destroying or discarding any such Books and Records and, if the other parties so request, Holdco or such Company shall allow the other parties to take possession of such Books and Records.

 

(d)              Any party who receives any notice of a pending or threatened Tax Contest relating to Holdco, any Company, Seller or Seller Parent with respect to Holdco or any Company, which may give rise to Liability of another party hereto, shall promptly notify Purchaser and Seller within ten Business Days of the receipt of such notice. The parties each agree to consult with and to keep the other parties hereto informed on a regular basis regarding the status of any Tax Contest to the extent that such Tax Contest could affect a Liability of such other parties (including indemnity obligations hereunder). Seller shall have the right to represent Holdco’s and each Company’s interests in any Tax Contest and to employ counsel of Seller’s choice, but reasonably satisfactory to Purchaser, at Seller’s expense, but only to the extent such Tax Contest pertains to Pre-Closing Taxes (other than Taxes that relate to a Straddle Period). Purchaser shall have the right to participate in such proceeding at its own expense, and shall be entitled to control the disposition of any issue involved in such proceeding which does not affect a potential Liability of Seller. In the case of a Tax Contest relating to a Straddle Period, Purchaser and Seller shall be entitled to represent their own interests in light of their responsibilities (including indemnity obligations) for the related Taxes, at their own expense. Notwithstanding the foregoing, Seller shall not agree to any settlement for any taxable period that would affect Tax Liabilities of Purchaser, Holdco or any Company for any taxable period beginning on or after the Closing Date without the prior written consent of Purchaser, such consent not to be unreasonably withheld or delayed, and Purchaser shall not agree to any settlement for any taxable period that would affect Tax Liabilities of Seller, Seller Parent, Holdco or any Company for any taxable period ending on or prior to the Closing Date or, though it ends after the Closing Date, materially affects taxable periods prior thereto without the prior written consent of Seller, such consent not to be unreasonably withheld or delayed. Purchaser shall be entitled to control, in its discretion and at its expense, any other Tax Contests with respect to Holdco or any Company.

 

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(e)              Purchaser and Seller further agree, upon request, to use their reasonable efforts to obtain any certificate or other document from any governmental entity or any other Person as may be necessary to mitigate, reduce or eliminate any Tax that would be imposed with respect to the transactions contemplated hereby.

 

(f)              All tax sharing agreements or similar agreements with respect to or involving Holdco or any Company (including any tax sharing agreement or similar agreement between Seller and Holdco or any Company) shall be terminated as of the Closing Date and, after the Closing Date, no Company shall be bound thereby or have any Liability thereunder.

 

6.5            Use of Name . As promptly as practicable after the Closing Date, and in any event not later than six months after the Closing Date (unless the consent of the lenders for the name changes contemplated by this Section 6.5 pursuant to the Facility Agreement shall not have been obtained by the end of such six-month period, in which case such period shall be extended by an additional three months), Purchaser agrees that it will cease, and will cause Holdco and the Companies to cease all use of the “Gener8” name, including on the Vessels and in their corporate names and materials.

 

6.6            Settlement of Intercompany Accounts . Except as set forth on Schedule 6.6 of the Seller Disclosure Schedules, Purchaser, Seller and Seller Parent agree and shall cause their respective Affiliates to agree (and Purchaser shall cause the Acquired Entities to agree) that, from and after immediately prior to the Closing, all rights and obligations of any party under any agreement or arrangement (including all intercompany receivables and payables between entities) between Gener8, Seller Parent, Seller and any of their respective Affiliates (other than the Acquired Entities), on the one hand, and the Acquired Entities, on the other hand, including any power of attorney delivered by any Acquired Entity in favor of Gener8, Seller Parent, Seller or any of their respective Affiliates (other than the Acquired Entities), shall terminate and be cancelled without any further Liability, including Liability relating to any period prior to the Closing.

 

6.7            Access to Information . After the date hereof until the Closing Date (and subject to applicable Law), each of Seller and Seller Parent shall, and each shall use its respective reasonable commercial efforts to cause Gener8 to cause each Acquired Entity to, upon reasonable notice and during normal business hours, (a) provide (and cause their respective officers and other Representatives to provide) such assistance and cooperation as is reasonably requested by Purchaser; (b) provide Purchaser and its Representatives with access to (i) the accounting books and other business, financial and operating data, records, plans, reports and documents related to, and employees and personnel knowledgeable about, the Acquired Entities, their respective current and former assets (including the Vessels), Liabilities and operations and related information reasonably requested by Purchaser, and (ii) each Vessel’s superintendent employed by the third party manager; and (c) instruct the Representatives of Gener8 and the ship managers and pool managers of the Vessels to cooperate with Purchaser in the matters described in clauses (a) and (b) above. Notwithstanding anything to the contrary in this Agreement, none of Seller Parent, Seller, any Acquired Entity or Gener8 (or any of their respective Affiliates) shall be required to provide such access (or to use efforts to attempt to provide such access) or disclose any information if doing so is reasonably likely to (x) result in a waiver of attorney-client privilege, work product doctrine or similar privilege or (y) violate any material Contract to which it is a party or to which it is subject or applicable Law (it being understood that Seller shall cooperate in any reasonable efforts and requests for waivers that would enable otherwise required disclosure to Purchaser to occur without so waiving privilege or violating such Contract or Law).

 

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6.8.          Books and Records . As promptly as practicable after the later to occur of (a) Seller’s receipt of the Books and Records of the Acquired Entities and (b) the Closing, to the extent not previously delivered, Seller shall deliver or cause to be delivered to Purchaser all Books and Records of each of the Acquired Entities, without regard to whether such Books and Records were originally kept by such Acquired Entity.

 

6.9           Insurance .

 

(a)              Neither Seller Parent nor Seller shall (and each shall use its respective reasonable efforts to cause Gener8 not to) permit any policy set forth on Schedule 3B.4 of the Seller Disclosure Schedules to be cancelled, terminate or lapse, unless, simultaneously with such cancellation, termination or lapse, replacement policies underwritten by insurance companies of nationally recognized standing having comparable deductions and providing coverage equal to or greater than the coverage under the cancelled, terminated or lapsed policies for substantially similar premiums or less are in full force and effect, in each case, to the extent such cancellation, termination or lapse would affect coverage of the Acquired Entities or Vessels for any period prior to the Closing.

 

(b)              With respect to acts, omissions, events or circumstances relating to Holdco, any Company or any Vessel that occurred or existed prior to the Closing (“ Pre-Closing Occurrences ”) that are covered or potentially covered by any occurrence-based policies under which Holdco, any Company or any Vessel was an insured or otherwise covered on or prior to Closing (each a “ Covered Insurance Claim ” and collectively, “ Covered Insurance Claims ”), Holdco or the relevant Company may, or may cause Seller or its Affiliates to make, Covered Insurance Claims on its behalf under such occurrence-based policies subject to the terms and conditions of such occurrence-based policies and this Agreement, to the extent such coverage and limits are available; it being understood that Seller hereby authorizes each Acquired Entity to submit and pursue claims for any and all Pre-Closing Occurrences arising in connection with the Vessels or the relevant Acquired Entity to the applicable insurance providers of Seller or its Affiliates to the extent permitted under the applicable Policy and where not permitted, Seller agrees, upon receipt of a written request by Purchaser, to use its reasonable best efforts to submit and pursue such claims on Purchaser’s behalf.

 

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6.10          Cooperation . On the terms and subject to the conditions of this Agreement, Seller Parent, Seller and Purchaser shall use their respective reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to (i) cause the conditions precedent to the Closing set forth in Section 5 to be satisfied prior to the Outside Date (as defined below); provided that no party shall be required to use reasonable best efforts to ensure the occurrence of the condition specified in Section 5.1(d) or Section 5.2(c) and (ii) consummate and make effective the transactions contemplated by this Agreement and cause the Closing to occur. Purchaser, Seller and Seller Parent shall furnish to each other such necessary information and reasonable assistance as the other may request in connection with its preparation of any filing or submission that is required by any Law or Governmental Authority or, with respect to periods which precede or include the Closing Date, any report required under the Facility Agreement or any Finance Document (as defined in the Facility Agreement). In addition, each party shall use its respective reasonable best efforts to obtain, and to cooperate in obtaining, all consents from Third parties, in each case required as a result of or in connection with the transactions contemplated hereby. Without limiting the generality of the foregoing, Purchaser shall, no later than five (5) Business Days prior to the Company Shareholders Meeting (as defined in the Merger Agreement), provide to Seller one of the following notices: (a) an SPA Term Loan B Consent Notice, (b) a Sale and Repurchase Term Loan B Consent Notice or (C) a Term Loan B Consent Failure Notice.

 

6.11          Confidentiality . From and after the Closing, Seller and Seller Parent shall, and shall cause their respective Affiliates and Representatives to, keep confidential any and all non-public information relating to the Vessels and the Acquired Entities; provided , that notwithstanding the foregoing, such non-public information shall not include information that (a) is or becomes generally available to the public other than as a result of a disclosure by Seller or Seller Parent or any of their respective Affiliates or Representatives in breach of this Section 6.11 ; or (b) is required to be disclosed by any applicable Law or Order, including applicable rules of any securities exchange.

 

6.12          Obligations of Seller and Gener8 . Seller Parent shall cause Seller and, following the Closing, Gener8 (as the surviving party to the Merger) to perform their respective obligations under this Agreement and to consummate the transactions contemplated hereby upon the terms and subject to the conditions set forth in this Agreement.

 

Section 7.                Termination .

 

7.1            Termination Date . The provisions of this Agreement shall terminate on the earliest to occur of (a) termination of the Merger Agreement in accordance with its terms; (b) delivery of written notice by Purchaser or Seller announcing its intent to terminate in the event Seller or Seller Parent, in the case of Purchaser, or Purchaser, in the case of Seller, is in breach of any representation, warranty, covenant or agreement set forth in this Agreement and such breach would cause a failure of any condition set forth in Section 5 (other than a breach by Purchaser that causes the conditions set forth in Section 5.1(g) to fail), provided that if curable, such termination shall not occur if such breach has been cured within a period of ten days following such notification; (c) delivery of written notice by Purchaser or Seller in the event any Governmental Authority has issued an Order permanently enjoining the transactions contemplated by this Agreement or the Merger Agreement, and such Order has become final and non-appealable; or (d) delivery of written notice by Purchaser or Seller on or after June 30, 2018 if the Closing has not yet occurred by such date (the “ Outside Date ”); provided the party seeking to terminate this Agreement is not then in material breach hereof; and provided , further , that in no event shall Purchaser be entitled to terminate this Agreement if the Closing has not yet occurred by the Outside Date as the direct result of a failure of the conditions set forth in Section 5.1(g) . This Agreement may also be terminated at any time prior to the Closing Date by mutual written consent of Purchaser and Seller.

 

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7.2         Sale and Repurchase Term Loan B Consent Notice . Notwithstanding anything to the contrary in Section 7.1 , no later than three (3) Business Days following Seller’s receipt of a Sale and Repurchase Term Loan B Consent Notice, Seller shall deliver written notice to Purchaser either to (a) terminate this Agreement or (b) effect the following transactions (this Agreement consequently being deemed modified to reflect such transactions, mutatis mutandis ):

 

(i)     at the Closing, Seller, Seller Parent and Purchaser shall consummate the transactions contemplated by this Agreement, upon the terms and conditions set forth herein; provided that for purposes of payment of the Estimated Purchase Price, Purchaser shall have the right to deliver the Gener8 Andriotis Note and the Gener8 Militiades Note in lieu of the equivalent amount of cash due to Seller under Section 2.2 ; and

 

(ii)    Seller shall repurchase the Gener8 Andriotis and the Gener8 Militiades from Purchaser no later than, with respect to each Vessel, the date when such Vessel is next in one safe port or anchorage or berth free from cargo following the Closing, pursuant to the terms and conditions set forth in the memoranda of agreement with respect to the Gener8 Andriotis and Gener8 Militiades (substantially in the form of the Laura Lynn MOA, as set forth on Annex E , with logical changes including but not limited to those set forth in the cover page to Annex E) , with the consideration for the repurchase of the Gener8 Andriotis being the cancellation of all but $1,500,000 of the Gener8 Andriotis Note and, if applicable, payment of cash consideration equal to the amount by which the face value of the Gener8 Andriotis Note is less than $73,000,000 and the consideration for the repurchase of the Gener8 Militiades being the cancellation of all but $1,500,000 of the Gener8 Militiades Note and, if applicable, payment of cash consideration equal to the amount by which the face value of the Gener8 Militiades Note is less than $73,000,000;

 

provided , that the obligation of Purchaser to consummate the transactions contemplated by this Section 7.2(b) is subject to the Laura Lynn MOA not having been terminated prior to the Closing other than as a result of (X) the total (or constructive) loss of the vessel, (Y) frustration of contract not resulting from the actions, omissions or conduct of either party to the Laura Lynn MOA, or (Z) the willful actions, omissions or conduct of Purchaser’s affiliate that is a party to the Laura Lynn MOA.

 

7.3            Term Loan B Consent Failure Notice . Notwithstanding anything to the contrary in Section 7.1 , no later than three (3) Business Days following Seller’s receipt of a Term Loan B Consent Failure Notice, Seller shall deliver written notice to Purchaser either to (a) terminate this Agreement or (b) effect the following transactions (this Agreement consequently being deemed modified to reflect such transactions, mutatis mutandis ):

 

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(i) at the Closing, (A) Seller shall sell to one or more subsidiary designees of Purchaser, and Purchaser shall cause such designees to purchase from Seller, Holdco and each of the Companies in exchange for (1) with respect to Holdco and the Companies that directly own the Gener8 Supreme, Gener8 Strength, Gener8 Chiotis and Gener8 Success, aggregate cash consideration of $288,000,000, (2) with respect to the Company that directly owns the Gener8 Andriotis, delivery of the Gener8 Andriotis Note and (3) with respect to the Company that directly owns the Gener8 Militiades, delivery of the Gener8 Militiades Note, (C) Seller shall cause all Indebtedness outstanding under the Facility Agreement to be paid in full and the Facility Agreement and any security arrangements related thereto to be terminated and released pursuant to a notice of prepayment which shall have been delivered by Gener8 to the lenders under the Facility Agreement at least ten Business Days prior to the Closing Date; provided that each of Seller and Seller Parent shall use their respective reasonable commercial efforts to cause Gener8 to deliver such notice of prepayment on the first Business Day following the Company Shareholders Meeting (as defined in the Merger Agreement), and (D) the parties shall enter into memoranda of agreement substantially in the form set forth on Annex E (with logical changes including but not limited to those set forth in the cover page to Annex E ) with respect to each of the Gener8 Andriotis and Gener8 Militiades providing for the sale of each such Vessel by Purchaser to Seller;

 

(ii) at such time as the Gener8 Andriotis is next in one safe port or anchorage or berth free from cargo following the Closing, pursuant to the memorandum of agreement referenced in Section 7.3(b)(i)(D) above, Purchaser shall cause its designee to sell to Seller, and Seller shall purchase from such designee, the Gener8 Andriotis in exchange for cancellation of all but $1,500,000 of the Gener8 Andriotis Note; and

 

(iii) at such time as the Gener8 Militiades is next in one safe port or anchorage or berth free from cargo following the Closing, pursuant to the memorandum of agreement referenced in Section 7.3(b)(i)(D) above, Purchaser shall cause its designee to sell to Seller, and Seller shall purchase from such designee, the Gener8 Militiades in exchange for cancellation of all but $1,500,000 of the Gener8 Militiades Note;

 

provided , for the avoidance of doubt, that the amounts payable by Purchaser at each Closing under this Section 7.3 shall be subject to Closing Net Asset Amount adjustment as contemplated by Section 1 in respect of each Company; provided , further, that the obligation of Purchaser to consummate the transactions contemplated by this Section 7.3(b) is subject to the Laura Lynn MOA not having been terminated prior to the Closing, other than as a result of (X) the total (or constructive) loss of the vessel, (Y) frustration of contract not resulting from the actions, omissions or conduct of either party to the Laura Lynn MOA, or (Z) the willful actions, omissions or conduct of Purchaser’s affiliate that is a party to the Laura Lynn MOA.

 

7.4            Break-Up Fee . In the event that this Agreement has been terminated pursuant to (a) Section 7.1(a) ; (b) Section 7.1(b) , due to a breach by Seller or Seller Parent of this Agreement; or (c) Section 7.1(d) , other than as the direct result of a failure of one of the conditions set forth in Section 5.1(c) or Section 5.1(g) , and provided that in the case of a termination pursuant to clause (a), (b) or (c) above, Seller or Seller Parent has received a break-up fee under the Merger Agreement or if the Merger is consummated (unless termination of this Agreement shall be attributable to actions or inactions of Purchaser, including any breach of this Agreement), the sole remedy of Purchaser shall be the payment by the Seller to Purchaser of a break-up fee equal to $5,000,000, by wire transfer of immediately available U.S. dollar funds, within three Business Days following receipt by Seller or Seller Parent of its break-up fee under the Merger Agreement or consummation of the Merger, as the case may be. In the event this Agreement shall terminate due to the failure of the Gener8 Closing to occur, and the Seller does not receive the break-up fee under the Merger Agreement, the Seller shall have no other liability hereunder. In the event this Agreement shall terminate under any circumstance other than as a result of a breach by Purchaser of any representation, warranty, covenant or agreement set forth in this Agreement, Purchaser shall have no liability hereunder.

 

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7.5            Effect of Termination . In the event of termination of this Agreement in accordance with Section 7.1 , (a) this Agreement shall be null and void and of no further force and effect, except that Section 7.4 , this Section 7.5 and Section 12 through Section 21 shall survive any such termination, and (b) such termination shall otherwise relieve each party to this Agreement from Liability for all violations of this Agreement that occurred prior to such termination other than Liability for any fraud or intentional breach that occurred prior to such termination. For purposes of this Agreement, the “intentional breach” by a party shall mean an action or omission taken or omitted to be taken that such party intentionally takes (or fails to take) and knows (or should reasonably have known) would, or would reasonably be expected to, cause a material breach of this Agreement.

 

Section 8.                Survival of Representations, Warranties and Agreements .

 

8.1           The covenants, representations and warranties of Seller and Purchaser contained herein shall survive the Closing; provided, however, that the representations and warranties of the parties contained in Sections 3 and 4 shall only survive the Closing Date for a period ending on the first anniversary of the Closing Date.

 

Section 9.                Indemnification .

 

9.1           Subject to the terms and conditions of this Section 9 (including those set forth on Annex D and incorporated herein ) , each party (the “ Indemnifying Party ”) agrees to indemnify and hold the other party (the “ Indemnified Party ”) harmless against any and all reasonable and documented losses, costs and expenses (including legal expenses, taxes (including any interest and penalties) and other expenses), resulting from or relating to:

 

  (a) any misrepresentation or breach of any representation or warranty of the Indemnifying Party contained in this Agreement or in any certificate or other instrument delivered by it at the Closing;

 

  (b) any breach of any covenant of the Indemnifying Party contained in this Agreement;

 

  (c) any and all actions, suits, demands, assessments or judgments with respect to any claim arising out of or relating to the subject matter of such indemnification; and

 

  (d) with respect to Purchaser as the Indemnified Party, any Legal Proceeding arising out of or relating to the Merger Agreement or the transactions contemplated thereby, to the extent Purchaser is made a party to such Legal Proceeding.

 

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9.2           Any payments made pursuant to Section 9 shall be treated as an adjustment to the Purchase Price for United States federal income tax purposes. Other than in the case of fraud, the parties’ respective indemnification obligations under Section 9.1(a) and, to the extent relating to Section 9.1(a) , Section 9.1(c) of this Agreement are capped at 10% of the Purchase Price, except in the case of a breach of Section 3A.6 (Valid Title), Section 3B.2 (Capitalization) and the first sentence of Section 3B.3 (Title to Vessels) which shall be capped at the Purchase Price. Notwithstanding anything herein to the contrary, neither Seller nor Seller Parent shall have any liability under this Agreement (for indemnification or otherwise) for any breach to the extent that any losses or damages resulting therefrom are included as Liabilities in the Closing Net Asset Amount or would otherwise result in double recovery for any such indemnifiable losses or damages.

 

9.3           In any instance in which the Indemnifying Party shall be required to indemnify the Indemnified Party under this Agreement, the parties shall comply with the terms and conditions of Annex D .

 

9.4           In no event shall Purchaser, Seller Parent or Seller be required to indemnify, defend, hold harmless, pay or reimburse any Indemnified Party under this Section 9 , or otherwise be liable in connection with this Agreement, the negotiation, execution or performance of this Agreement, or the transactions contemplated hereby, for any losses or damages that are punitive, incidental, consequential, special or indirect; provided, however, that the foregoing limitations shall not apply to any such losses or damages (i) to the extent such losses or damages were reasonably foreseeable or (ii) if any Indemnified Party is held liable to any third party for such losses or damages.

 

Section 10.             Specific Performance . The parties acknowledge and agree that each party shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they may be entitled at Law or in equity.

 

Section 11.              Exclusive Remedy . Except for the assertion of any claim based on fraud, the remedies provided in Sections 7, 9 and 10 shall be the sole and exclusive legal remedies of the parties with respect to any and all claims arising out of or in connection with this Agreement and the transactions contemplated hereby.

 

Section 12.              Notices . All notices, requests and other communications to any party hereunder shall be in writing (including email transmission) and shall be given,

 

if to Purchaser, to:

 

Seaways Holding Corporation

c/o International Seaways Ship Management LLC

600 Third Avenue 39th Floor

New York NY, 10016

  Attention: General Counsel

Email: LegalDepartment@intlseas.com

 

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with a copy (which shall not constitute notice) to:

 

Cleary Gottlieb Steen & Hamilton

One Liberty Plaza

New York NY, 10006

  Attention: Neil Q. Whoriskey and Paul M. Tiger

Email: nwhoriskey@cgsh.com and ptiger@cgsh.com

 

if to Seller or to Seller Parent, to:

 

Euronav NV

De Gerlachekaai 20

2000, Antwerp, Belgium

  Attention: Egied Verbeeck, General Counsel
    An Goris, Secretary General

Facsimile No.: +32 (3) 247-4409

Email: legal@euronav.com

 

with a copy (which shall not constitute notice) to:

 

Seward & Kissel LLP

One Battery Park Plaza

New York, New York 10004

  Attention: Gary Wolfe and Michael S. Timpone

Email: wolfe@sewkis.com and timpone@sewkis.com

 

or to such other address as such party may hereafter specify for the purpose by notice to the other parties hereto. All such notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. on a Business Day. Otherwise, any such notice, request or communication shall be deemed to have been received on the next succeeding Business Day.

 

Section 13.              Entire Agreement; Effect on Prior Documents . This Agreement (including the exhibits, schedules, annexes and appendices hereto) constitutes the entire agreement among the parties with respect to the transactions contemplated hereby and supersedes all prior negotiations, commitments, agreements and understandings among them with respect thereto, including, for the avoidance of doubt, the letter of intent dated as of December 20, 2017 between Seller Parent and International Seaways, Inc.

 

Section 14.              Amendments; Waiver . Except as otherwise provided herein, this Agreement may be amended, and compliance with any provision of this Agreement may be omitted or waived, only by the written agreement of Seller, Seller Parent and Purchaser. Notwithstanding the foregoing, no failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder.

 

Section 15.              Counterparts . This Agreement may be executed in any number of counterparts, each such counterpart shall be deemed to be an original instrument, and all such counterparts together shall constitute but one agreement. Delivery of an executed copy of this Agreement by facsimile or electronic transmission shall be deemed as effective as delivery of an originally executed copy.

 

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Section 16.              Assignment; Third Party Beneficiaries . The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, but neither this Agreement nor an of the rights, interest or obligations hereunder shall be assigned by any party hereto without the prior written consent of the other party and any purported assignment in violation hereof shall be void. Notwithstanding the foregoing, either party may assign its rights or interests hereunder to an Affiliate; provided that any such assignment shall not relieve the assigning party of its obligations hereunder. The terms and conditions of this Agreement are intended solely for the benefit of the parties hereto and their respective successors and permitted assignees, and it is not the intention of the parties to confer third party beneficiary rights on any Person.

 

Section 17.              Headings; Interpretation . The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement. The parties have participated jointly in the negotiation and drafting of this Agreement, and, in the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties, and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement. Whenever the context may require, any pronoun used in this Agreement shall include the corresponding masculine, feminine and neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa. The use in this Agreement of the term “including” means including “without limitation”. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, unless the context otherwise requires. All references to “day” or “days” are to calendar days, unless reference is made to “Business Days”. If any payment is required to be made or other action is required to be taken pursuant to this Agreement on a day which is not a Business Day, then such payment or action shall be made or taken on the next Business Day. All references to monetary amounts are to the currency of the United States.

 

Section 18.              Severability . Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction, provided , in the event enforcement of this Agreement in the absence of the unenforceable or invalid provision would result in a party being deprived of a material benefit of the original bargain, the parties will in good faith reform this Agreement to reflect their original intentions as closely as possible.

 

Section 19.              Expenses . Each of the parties agrees to pay its own expenses incident to this Agreement and the performance of its obligations hereunder.

 

Section 20.              Further Assurances . From and after the Closing, upon the request of a party, the other party will execute and deliver such instruments, documents, conveyances or other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement.

 

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Section 21.              Public Announcements . Seller, Seller Parent and Purchaser shall work together to coordinate public but separate announcements of the transactions contemplated by this Agreement (which have been approved by Gener8). Notwithstanding the foregoing, except as and to the extent required by law or to effectuate the transactions contemplated hereunder, each of Seller, Seller Parent and Purchaser agrees not to make any other public announcements concerning the subject of this Agreement without the prior written consent of the other party and Gener8, and each party shall direct its representatives not to make, directly or indirectly, any press release, public comment, statement or other communication or announcement with respect to this Agreement between the parties or any of the terms, conditions or other aspects of the transactions contemplated by this Agreement. To the extent any such disclosure is required by Law or the applicable rules of any stock exchange, the party required to disclose such information shall notify the other party in writing and obtain its consent to the form and content of such disclosure (which consent shall not be unreasonably withheld, conditioned or delayed); provided, however, that a party may, without the prior consent of the other parties (but after prior consultation, to the extent practicable in the circumstances) issue such press release or make such public statement to the extent required by applicable Law or the applicable rules of any stock exchange. Except as provided above, the existence, nature, terms and conditions of this Agreement are strictly confidential and shall not be disclosed by either of the parties in any manner or form, directly or indirectly, to any person or entity under any circumstances.

 

Section 22.              Governing Law; Jurisdiction; Waivers .

 

22.1          Governing Law . This Agreement will be deemed to be made in and in all respects will be interpreted, construed and governed by and in accordance with the Laws of the State of New York without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than the State of New York, except to the extent that the Law of the Republic of the Marshall Islands is mandatorily applicable to this Agreement.

 

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22.2          Jurisdiction . EACH OF THE PARTIES HERETO CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY OR IN THE FEDERAL SOUTHERN DISTRICT IN THE STATE OF NEW YORK AND ANY APPELLATE COURT THEREFROM LOCATED IN NEW YORK, NEW YORK AND IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT MAY BE LITIGATED IN SUCH COURTS. EACH OF THE PARTIES HERETO ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS RESPECTIVE PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL AND NONAPPEALABLE JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF THE PARTIES HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT THE ADDRESS SPECIFIED IN THIS AGREEMENT, SUCH SERVICE TO BECOME EFFECTIVE 15 CALENDAR DAYS AFTER SUCH MAILING. NOTHING HEREIN WILL IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OF ANY PARTY HERETO TO SERVE ANY SUCH LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION OVER OR TO BRING ACTIONS, SUITS OR PROCEEDINGS AGAINST ANY OTHER PARTY HERETO IN SUCH OTHER JURISDICTIONS, AND IN SUCH MANNER, AS MAY BE PERMITTED BY ANY APPLICABLE LAW. NOTHING IN THIS SECTION 22.2 SHALL LIMIT THE JURISDICTION OF THE DISPUTE ACCOUNTANTS SET FORTH IN SECTION 1.5 , ALTHOUGH CLAIMS MAY BE ASSERTED IN THE COURTS DESCRIBED IN THIS SECTION 22.2 FOR PURPOSES OF ENFORCING THE JURISDICTION AND JUDGMENTS OF THE DISPUTE ACCOUNTANTS.

 

22.3          Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first written above.

 

  SELLER:
   
  EURONAV MI INC.
     
  By: /s/ Hugo De Stoop
  Name: Hugo De Stoop
  Title:   Director
   
  SELLER PARENT:
   
  EURONAV NV
     
  By: /s/ Egied Verbeeck
  Name: Egied Verbeeck
  Title:   Member of the Executive Committee
   
  PURCHASER:
   
  SEAWAYS HOLDING CORPORATION
     
  By: /s/ Lois K. Zabrocky
  Name: Lois K. Zabrocky
  Title:   President and Chief Executive Officer

 

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ANNEX A

 

DEFINITIONS

 

As used in this Agreement, the following terms shall have the meanings set forth below:

 

Accounting Principles ” means, as in effect at the date of the financial statement to which it refers or if there is no such financial statement, then as of the Closing Date, (a) in accordance with the accounting principles (with consistent classifications, judgments, elections, inclusions, exclusions and valuation and estimation methodologies) adopted in the Trial Balance Sheet, and (b) to the extent not addressed by clause (a), in accordance with GAAP; provided , however , that in the event that the accounting treatment of any item is specifically prescribed in this Agreement (other than this definition), then such accounting treatment shall prevail over any conflicting accounting treatment that would be prescribed by this definition.

 

Affiliate ” means, with respect to a Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, such Person. For purposes of this Agreement, “ control ” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, as trustee or executor, by Contract or otherwise.

 

Books and Records ” means, with respect to any Person, all books, ledgers, files, reports, plans, records (including shipping records), manuals and other materials (in any form or medium) of, or maintained for, or in respect of, such Person.

 

Business Day ” means a day other than Saturday, Sunday or other day on which commercial banks located in New York, New York and Belgium are authorized or required by applicable Law to close.

 

Cash and Cash Equivalents ” means “cash and cash equivalents”, calculated in accordance with the Accounting Principles; provided, that “Cash and Cash Equivalents” does not include any restricted cash other than cash and cash equivalents held in the Debt Service Reserve Account or Minimum Liquidity Account.

 

Closing Net Asset Amount ” means the amount (which may be positive or negative) equal to the Current Assets minus the Company Liabilities.

 

Closing Net Debt ” means, as of 12:01 a.m., New York City time on the Closing Date, the amount (which may be positive or negative) equal to (a) the aggregate amount of, as of such time, without double counting, all outstanding Indebtedness of the Acquired Entities, including all amounts outstanding under the Facility Agreement, minus (b) the aggregate amount of all Cash and Cash Equivalents held by any Acquired Entity and all cash and cash equivalents held in the Debt Service Reserve Account or Minimum Liquidity Account as of such time (in each case, determined on a combined basis in accordance with the Accounting Principles).

 

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Company Liabilities ” means, as of 12:01 a.m., New York City time on the Closing Date, the Liabilities of the Acquired Entities, determined on a combined basis in accordance with the Accounting Principles; provided , that “Company Liabilities” shall not include (a) any Indebtedness to the extent taken into account in the determination of Closing Net Debt, (b) any “intercompany” amounts owed by the Acquired Entities to Seller Parent, Seller, Gener8 or any of their respective Affiliates or (c) future performance obligations under any Contract other than obligations arising from a breach or default thereunder that occurred or existed prior to the Closing.

 

Contract ” means any contract, agreement, note, bond, indenture, mortgage, guarantee, option, derivative, lease, license, sales or purchase order, warranty, commitment or other instrument, obligation or binding arrangement or understanding of any kind, whether written or oral.

 

Current Assets ” means, as of 12:01 a.m., New York City time on the Closing Date, the current assets, other than Cash and Cash Equivalents, of the Acquired Entities (including the undistributed earnings due under any Pool Agreement and the net working capital held by a pool on behalf of the Acquired Entities pursuant to any Pool Agreement) determined on a combined basis in accordance with the Accounting Principles; provided, that “Current Assets” shall not include (a) any amount in respect of the Vessels, (b) any deferred financing costs or other intangible assets, (c) any prepaid insurance premiums, (d) any deferred Tax assets, (e) any “intercompany” amounts owed to the Acquired Entities by Seller Parent, Seller, Gener8 or any of their respective Affiliates or (f) any accounts receivable due from Gener8 or any of its Affiliates as of the Closing Date.

 

Debt Service Reserve Account ” has the meaning ascribed thereto in the Facility Agreement.

 

Facility Agreement ” means that certain facility agreement dated November 30, 2015, as supplemented by a supplemental agreement dated December 28, 2015, as amended and restated by an amending and restating deed dated June 29, 2016 and as further supplemented by a second supplemental agreement dated November 8, 2017 (the “ Facility Agreement ”), by and among Holdco, as borrower, Gener8, as parent guarantor, the Companies, as owner guarantors, Citibank, N.A. and Nordea, as global coordinators, the lenders from time to time party thereto and the other parties thereto.

 

GAAP ” means generally accepted accounting principles in the United States, consistently applied.

 

Gener8 Andriotis Note ” means the note to be issued by Purchaser at the Closing in the event the transactions contemplated by Section 7.2 or Section 7.3 are effected having a face amount (a) in the case of Section 7.2 , equal to the lesser of (i) $73,000,000 and (ii) 50% of the Estimated Purchase Price, and (b) in the case of Section 7.3 , $73,000,000, and in each such case such note shall be non-interest bearing and shall mature upon the earlier to occur of (Y) the consummation of the transactions contemplated by the memorandum of agreement with respect to the purchase and sale of the Gener8 Andriotis, or (Z) September 30, 2018.

  

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Gener8 Militiades Note ” means the note to be issued by Purchaser at the Closing in the event the transactions contemplated by Section 7.2 or Section 7.3 are effected having a face amount equal to (a) in the case of Section 7.2 , the lesser of (i) $73,000,000 and (ii)50% of the Estimated Purchase Price, and (b) in the case of Section 7.3 , $73,000,000, and in each such case such note shall be non-interest bearing and shall mature upon the earlier to occur of (Y) the consummation of the transactions contemplated by the memorandum of agreement with respect to the purchase and sale of the Gener8 Militiades or (Z) September 30, 2018.

 

Governmental Authorizations ” means, with respect to any Person, all licenses, permits (including construction permits), certificates, waivers, consents, franchises, accreditations, exemptions, variances, easements, expirations and terminations of any waiting period requirements and other authorizations and approvals issued to such Person by or obtained by such Person from any Governmental Authority, or of which such Person has the benefit under any applicable Law.

 

Governmental Authority ” means any foreign, supranational, federal, state, provincial or local government, court, arbitration panel, or any governmental or quasi-governmental, regulatory, judicial or administrative authority, board, bureau, agency, commission or self-regulatory organization (including any stock exchange), in any such case, of competent jurisdiction.

 

Indebtedness ” means, with respect to any Person as of any date of determination, without duplication, any (a) obligation of such Person with respect to any indebtedness for borrowed money as of such date (including all obligations for principal, accrued interest, and any premiums, penalties, fees, expenses and breakage costs that are payable by such Person as of such date), (b) obligation of such Person with respect to any indebtedness evidenced by any bond, debenture, note, mortgage, indenture or other debt instrument or debt security as of such date (including all obligations for principal, accrued interest, and any premiums, penalties, fees, expenses and breakage costs that are payable by such Person as of such date), (c) obligation of such Person with respect to any sale/leaseback or similar arrangement in respect of any asset (including all obligations for principal, accrued interest, and any premiums, penalties, fees, expenses and breakage costs that are payable by such Person as of such date), (d) all reimbursement obligations with respect to outstanding banker’s acceptances or letters of credit, but in the case of letters of credit only to the extent drawn as of such date, (e) Liability of such Person as of such date with respect to any hedging obligations, including interest rate or currency exchange swaps, collars, caps or similar hedging obligations, (f) responsibility or Liability of such Person as of such date directly or indirectly as obligor, guarantor, surety or otherwise of any of the foregoing, and (g) obligations of the type referred to in clauses (a) through (f) of other Persons secured by (or for which the holder of such obligations has an existing right, contingent or otherwise, to be secured by) any Lien on any property or asset of such Person (whether or not such obligation is assumed by such Person). For the avoidance of doubt, “Indebtedness” shall exclude any item to the extent taken into account in the determination of Company Liabilities.

 

Law ” means any foreign, supranational, federal, state, provincial or local law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, Order or other similar requirement enacted, adopted, promulgated or applied by a Governmental Authority.

 

  29  

 

 

Legal Proceeding ” means any claim, litigation, action, suit (whether civil, criminal, administrative, judicial or investigative), audit, hearing, investigation, binding arbitration or mediation or proceeding, in each case commenced, brought, conducted, heard before or otherwise involving any Governmental Authority, arbitrator or mediator.

 

Liability ” means Indebtedness, debts, Taxes, commitments, commissions, duties, fees, salaries, performance or delivery penalties, warranty liabilities and other liabilities and obligations (whether pecuniary or not, including obligations to perform or forbear from performing acts or services), fines or penalties, in each case whether accrued or fixed, known or unknown, absolute or contingent, matured or unmatured, liquidated or unliquidated, determined or determinable, on or off-balance sheet, and including those arising under any Contract, Law or proceeding.

 

Lien ” means, with respect to any property or asset, any mortgage, lien, pledge, hypothecation, charge, security interest, infringement, interference, right of first refusal, right of first offer, preemptive right, option, community property right or other adverse claim or encumbrance of any kind in respect of such property or asset.

 

Material Adverse Effect ” means any change, effect, event, occurrence or development (“ Effect ”) that, individually or in the aggregate with all such other Effects, (a) has or would reasonably be expected to have a material adverse effect on the financial condition, business, assets (including Vessels) or liabilities or results of operations of the Acquired Entities taken as a whole; provided , that none of the Effects to the extent attributable to the following shall be taken into account in determining whether there has been a Material Adverse Effect: (i) changes in applicable Law or GAAP or authoritative interpretations thereof, in each case, after the date hereof, (ii) changes in the global financial or securities markets or general global economic or political conditions, (iii) changes or conditions generally affecting the industry in which the Acquired Entities operate, (iv) acts of war, sabotage or terrorism, or any escalation or the worsening of the foregoing, or natural disasters, or (v) any failure by the Acquired Entities to meet any internal or published projections, forecasts or predictions in respect of financial or operating performance for any future period (provided that, in the case of this clause (v), the underlying cause of any such failure may be taken into account in determining whether a Material Adverse Effect has occurred), or (b) has or would reasonably be expected to materially impair the ability of Seller Parent or Seller to perform its obligations under this Agreement.

 

Minimum Liquidity Account ” has the meaning ascribed thereto in the Facility Agreement.

 

Order ” means any injunction, judgment, decree, order, ruling, writ, prohibition, assessment, subpoena or verdict or other decision issued, promulgated or entered by or with any Governmental Authority.

 

Permitted Liens ” has the meaning set forth in Section 3B.3 of this Agreement.

 

Person ” means any individual, corporation, partnership, limited liability company, a trust, an unincorporated association, or other entity or organization, including a Governmental Authority.

 

  30  

 

 

Pool Agreements ” means the pool agreements with VL8 Pool Inc. set forth on Schedule 3B.4 of the Seller Disclosure Schedules.

 

Pre-Closing Taxes ” means any Taxes of Holdco or any Company (or for which Holdco or any Company is liable) relating to any taxable period (or a portion thereof) ending on or prior to the Closing Date, including, for the avoidance of doubt, any Taxes allocable to the Pre-Closing Tax Straddle Period pursuant to Section 6.4(b) of this Agreement.

 

Representatives ” means, with respect to any Person, the respective directors, officers, employees, consultants, counsel, accountants, agents, advisors, investment bankers and other representatives of, or Persons retained by, such Person.

 

Seller Disclosure Schedules ” means the Seller Disclosure Schedules delivered by Seller to Purchaser prior to the execution of this Agreement and attached hereto.

 

Sale and Repurchase Term Loan B Consent Notice ” means a notice provided by Purchaser to Seller notifying Seller that the condition set forth in Section 5.1(g) with respect to the transactions contemplated by Section 7.2 (but not with respect to the other transactions contemplated by this Agreement) has been satisfied.

 

SPA Term Loan B Consent Notice ” means a notice provided by Purchaser to Seller notifying Seller that the condition set forth in Section 5.1(g) with respect to the transactions contemplated by this Agreement has been satisfied.

 

Tax ” (including with correlative meaning the terms “ Taxes ” and “ Taxable ”) means (a) all foreign, federal, state, local and other income, gross receipts, sales, use, ad valorem, value-added, intangible, unitary, transfer, franchise, license, payroll, employment, estimated, excise, environmental, stamp, occupation, premium, property, prohibited transactions, windfall or excess profits, customs, duties or other taxes, levies, fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts with respect thereto, (b) any Liability for payment of amounts described in clause (a) as a result of transferee Liability, of having been a member of an affiliated, consolidated, combined or unitary group for any period, or otherwise through operation of Law and (c) any Liability for payment of amounts described in clause (a) or (b) as a result of any tax sharing, tax indemnity or tax allocation agreement or any other express or implied agreement to indemnify any other Person for Taxes.

 

Tax Authority ” means any Governmental Authority, board, bureau, body, Person, department or authority of any United States federal, state or local jurisdiction or any non-United States jurisdiction, having jurisdiction with respect to any Tax.

 

Tax Return ” shall mean any return (including any information return), report, statement, schedule, notice, form, estimate or declaration of estimated tax relating to or required to be filed with any Governmental Authority in connection with the determination, assessment, collection or payment of any Tax.

 

  31  

 

 

Term Loan B Consent Failure Notice ” means a notice provided by Purchaser to Seller notifying Seller that the condition set forth in Section 5.1(g) has not been satisfied for either the transactions contemplated by this Agreement or for the transactions contemplated by Section 7.2 .

 

Term Loan B Facility ” means Purchaser’s existing term loan credit facility dated as of June 22, 2017 (as amended, restated, modified and/or supplemented from time to time.

 

Trial Balance Sheet ” means the trial balance sheet for each Acquired Entity as of December 31, 2017 provided to Purchaser prior to the execution of this Agreement.

 

  32  

 

 

ANNEX B

 

COMPANIES; VESSELS

 

Company   Vessel Name   Classification
Society
  DWT   Year
Built
  IMO
Number
  Flag State
                         
Gener8 Andriotis LLC   Gener8 Andriotis   ABS/CCS   301,014   2016   9727015   MI
                         
Gener8 Chiotis LLC   Gener8 Chiotis   ABS/CCS   300,973   2016   9727027   MI
                         
Gener8 Militiades LLC   Gener8 Militiades   ABS/CCS   301,038   2016   9727059   MI
                         
Gener8 Strength LLC   Gener8 Strength   ABS/CCS   300,960   2015   9734342   MI
                         
Gener8 Success LLC   Gener8 Success   ABS/CCS   300,932   2016   9727003   MI
                         
Gener8 Supreme LLC   Gener8 Supreme   ABS/CCS   300,933   2016   9734654   MI

 

  33  

 

 

ANNEX C

 

Closing Certificates/Documents/Instruments

 

  (a) Declaration of Class * or (depending on the Classification Society *) a Class Maintenance Certificate * issued within five (5) Days prior to the Closing Date confirming that each Vessel is in class free of condition/recommendation;

 

  (b) Certificate of good standing of Holdco and each Company dated not more than 5 Banking Days * prior to the Closing Date;

 

  (c) Letter of confirmation from the applicable Company addressed to Purchaser that, to the best of such Company’s knowledge, its Vessel is not blacklisted by any nation or international organization.

 

  (d) Certificate of Ownership and Encumbrance issued by the Deputy Maritime Commissioner of the Republic of the Marshall Islands evidencing that (i) each Company is the sole owner of its respective Vessel, and (ii) such Vessel is free from all encumbrances, mortgages and maritime liens other than the Mortgage.

 

  * The underscored capitalized terms above shall have the customary industry meanings and usage commonly ascribed to them in BIMCO SALESFORM 2012.

 

  34  

 

 

ANNEX D

 

 

Matters Relating to Indemnification Procedures

 

Indemnification Procedures .

 

  i. All claims for indemnification pursuant to Section 9 shall be made in accordance with the procedures set forth on this Annex D . An Indemnified Party entitled to assert a claim for indemnification (a “ Claim ”) pursuant to Section 9 shall give the Indemnifying Party written notice of any such Claim (a “ Claim Notice ”), which notice shall include a description in reasonable detail of (i) the basis for, and nature of, such Claim, including the facts constituting the basis for such Claim, and (ii) the estimated amount of the losses or damages that have been or may be sustained by the Indemnified Party in connection with such Claim; provided , however , that any such Claim Notice need only specify such information to the knowledge of the Indemnified Party as of the date of such Claim Notice and shall not limit or prejudice any of the rights or remedies of any Indemnified Party on the basis of any limitations on the information included in such Claim Notice, including any such limitations made in good faith to preserve the attorney-client privilege, work product doctrine or any other privilege. Any Claim Notice shall be given by the Indemnified Party to the Indemnifying Party, (A) in the case of a Claim in connection with any Legal Proceeding made or brought by any third party against such Indemnified Party (a “ Third-party Claim ”), reasonably promptly following receipt of notice of the assertion or commencement of such Legal Proceeding, and (B) in the case of a Claim other than a Third-party Claim (a “ Direct Claim ”), reasonably promptly after the Indemnified Party determines that it intends to seek indemnification for such Direct Claim; provided , however , that no failure to give such prompt written notice shall relieve the Indemnifying Party of any of its indemnification obligations hereunder except to the extent that the Indemnifying Party is materially and adversely prejudiced by such failure. The Indemnifying Party and Indemnified Party will cooperate in good faith to resolve any Direct Claim for a period of twenty Business Days before commencing any Legal Proceeding in connection with such Claim.

 

  35  

 

 

  ii. With respect to any Third-party Claim, the Indemnifying Party shall have the right, by giving written notice to the Indemnified Party within thirty days after delivery of the Claim Notice with respect to such Third-party Claim, to assume control of the defense of such Third-party Claim at the Indemnifying Party’s expense with counsel of its choosing that is reasonably satisfactory to the Indemnified party, and the Indemnified Party shall cooperate in good faith in such defense; provided , however , that such Indemnifying Party shall not have the right to control the defense of any Third-party Claim that (i) seeks any injunctive or other equitable relief against the Indemnified Party, or (ii) seeks monetary damages the amount of which would reasonably be expected to exceed any limitation on the amount of losses or damages for which the Indemnifying Party is responsible hereunder. The Indemnified Party or Indemnifying Party, as the case may be, that is not controlling such defense shall have the right, at its own cost and expense, to participate in the defense of any Third-party Claim with counsel selected by it; provided , however , that if, in the reasonable opinion of counsel to the Indemnified Party, (A) there are legal defenses available to the Indemnified Party that are different from or additional to those available to the Indemnifying party or (B) there exists a conflict of interest between the Indemnifying Party and the Indemnified Party that cannot be waived, the Indemnifying Party shall be liable for the reasonable fees and expenses of separate counsel (including advancement thereof) to the Indemnified Party in each jurisdiction in which the Indemnified Party reasonably determines counsel is required. If the Indemnifying Party elects not to control the defense of such Third-party Claim (including by failing to promptly notify the Indemnified party in writing of its election to control such defense in accordance herewith or fails to diligently prosecute the defense of such Third-party Claim, the Indemnified Party may control the defense of such Third-party Claim with counsel of its choosing, and the Indemnifying Party shall be liable for the fees and expenses of counsel (including advancement thereof) to the Indemnified Party in each jurisdiction in which the Indemnified Party reasonably determines counsel is required. Each of Purchaser and Seller shall reasonably cooperate with each other in connection with the defense of any Third-party Claim, including by retaining and providing to the party controlling such defense records and information that are reasonably relevant to such Third-party Claim and making available employees on a mutually convenient basis for providing additional information and explanation of any material provided hereunder. The Indemnified Party or Indemnifying Party, as the case may be, that is controlling such defense shall keep the other party reasonably advised of the status of such Legal Proceeding and the defense thereof and shall consider in good faith any recommendations made by the other party with respect thereto.

 

  iii. Notwithstanding anything in this Agreement to the contrary, (i) an Indemnifying Party shall not agree to any settlement of any Third-party Claim without the prior written consent of the Indemnified Party, such consent not to be unreasonably withheld, conditioned or delayed, unless such settlement would (A) include a complete and unconditional release of each Indemnified Party from all Liabilities or obligations with respect thereto, (B) not impose any Liability or obligation (including any equitable remedies) on the Indemnified Party and (C) not involve a finding or admission of any wrongdoing on the part of the Indemnified Party, and (ii) an Indemnified Party shall not agree to any settlement of a Third-party Claim without the prior written consent of the Indemnifying Party, such consent not to be unreasonably withheld, conditioned or delayed.

 

  36  

 

Exhibit 2.3

 

Execution Version

 

GUARANTEE

 

OF

 

INTERNATIONAL SEAWAYS, INC.

 

GUARANTEE, dated as of April 18, 2018 (this “ Guarantee ”), by International Seaways, Inc. a corporation incorporated and existing under the Laws of the Republic of the Marshall Islands (“ Purchaser Guarantor ”), in favor of Euronav MI Inc., a corporation incorporated and existing under the Laws of the Republic of the Marshall Islands (the “ Guaranteed Party ”). Each capitalized term used and not defined herein shall have the meaning ascribed to it in the Stock Purchase Agreement (as defined below), except as otherwise provided herein.

 

1.     Guarantee . To induce the Guaranteed Party to enter into the Stock Purchase Agreement, dated as of April 18, 2018 (as amended from time to time in accordance with its terms, the “ Stock Purchase Agreement ”), by and among Euronav NV, a corporation incorporated and existing under the laws of the Kingdom of Belgium, the Guaranteed Party and Seaways Holding Corporation, a corporation incorporated and existing under the Laws of the Republic of the Marshall Islands (“ Purchaser ”), Purchaser Guarantor hereby unconditionally and irrevocably guarantees to the Guaranteed Party the payment in full when due of all amounts payable by Purchaser pursuant to the Stock Purchase Agreement (including payment of any Adjustment in accordance with Section 1 of the Stock Purchase Agreement) and performance of the Purchaser thereunder (such amounts if and when payable and such performance obligations, the “ Purchaser Obligations ”); provided that (a) Purchaser Guarantor shall have all defenses to the payment of its obligations under this Guarantee that would be available to Purchaser under the Stock Purchase Agreement (including non-satisfaction of any of the conditions set forth in Section 5.1 thereof) and (b) if, following the Closing, the Guaranteed Party is obligated to pay Purchaser an Adjustment in accordance with Section 1 of the Stock Purchase Agreement and Purchaser Guarantor shall have previously made a payment to the Guaranteed Party under this Guarantee, the amount of the Adjustment shall first be paid to Purchaser Guarantor until Purchaser Guarantor shall have been reimbursed fully for its payment under this Guarantee and then the remainder of such Adjustment shall be made to Purchaser.

 

2.     Nature of Guarantee .  Purchaser Guarantor agrees that the guarantee contemplated by this Guarantee is a guarantee of payment and not of collection. To the fullest extent permitted by applicable Law, Purchaser Guarantor waives presentment to, demand of payment from and protest to any other Person of the Purchaser Obligations, and also waives promptness, diligence, notice of acceptance of this Guarantee and of the Purchaser Obligations and notice of protest for nonpayment.

 

3.     Guarantee Absolute . Subject to Section 1(a) of this Guarantee, the liability of the Purchase Guarantor under this Guarantee shall be irrevocable, absolute and unconditional irrespective of, and the Purchase Guarantor hereby irrevocably waives any defenses it may now or hereafter acquire in any way relating to, any or all of the following: (a) any illegality, lack of validity or unenforceability of any Purchaser Obligation; (b) any amendment, supplement, waiver or consent to departure from the terms of any Purchaser Obligation, including any renewal or extension of the time of payment or change in the manner or place of payment; (c) any change in the corporate existence, structure or ownership of the Purchaser or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Purchaser or any of its assets or any resulting release or discharge of any Purchaser Obligation; and (d) the existence of any claim, set-off or other right that the Purchase Guarantor may have at any time against the Guaranteed Party.

 

 

 

 

4.     Representations and Warranties . Purchaser Guarantor hereby represents and warrants to the Guaranteed Party that:

 

(a)       Purchaser Guarantor is a corporation duly organized, validly existing and in good standing under the Laws of the Republic of the Marshall Island;

 

(b)       Purchaser Guarantor has the power and authority to execute and deliver this Guarantee and to perform its obligations hereunder;

 

(c)       the execution, delivery and performance of this Guarantee by Purchaser Guarantor have been duly authorized by all necessary action on the part of Purchaser Guarantor and do not (i) contravene, conflict with or result in any violation of or constitute a breach of any provision of Purchaser Guarantor’s articles of incorporation, the by-laws or other organizational documents, (ii) contravene, conflict with or result in a violation or breach of any applicable Laws or governmental Orders binding on Purchaser Guarantor or its assets or (iii) contravene, conflict with or result in a violation or breach of any provision of, result in the loss of any benefit or the imposition of any additional payment or other Liability under, give any Person the right to declare a default or exercise any remedy under, to accelerate the maturity or performance of, or to cancel, terminate, redeem or modify, with or without notice or lapse of time or both, any material Contract to which Purchaser Guarantor or any of its Affiliates is a party or is bound;

 

(d)       this Guarantee constitutes a legal, valid and binding obligation of Purchaser Guarantor, enforceable against Purchaser Guarantor in accordance with its terms, except as such enforceability may be limited by: (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally or (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at Law); and

 

(e)       Purchaser Guarantor is not a party to, subject to or bound by any agreement or Order that would prevent the execution or delivery of this Guarantee by Purchaser Guarantor.

 

5.     Limitation . Notwithstanding any other provision of this Guarantee, the maximum aggregate Liability of Purchaser Guarantor under this Guarantee shall under no circumstances exceed the Purchase Price.

 

 

 

 

6.     Notices . All notices and other communications hereunder shall be given by the means specified by the Stock Purchase Agreement (and shall be deemed given as specified therein), as follows:

 

if to Purchaser Guarantor, to:

 

International Seaways, Inc.

c/o International Seaways Ship Management LLC

600 Third Avenue 39th Floor

New York NY, 10016

  Attention: General Counsel

Email: LegalDepartment@intlseas.com

 

with a copy (which shall not constitute notice) to:

 

Cleary Gottlieb Steen & Hamilton

1 Liberty Plaza

New York NY, 10003

  Attention: Neil Q. Whoriskey and Paul M. Tiger

Email: nwhoriskey@cgsh.com and ptiger@cgsh.com

 

if to the Guaranteed Party, to:

 

Euronav NV

De Gerlachekaai 20

2000, Antwerp, Belgium

  Attention: Egied Verbeeck, General Counsel
    An Goris, Secretary General

Facsimile No.: +32 (3) 247-4409

Email: legal@euronav.com

 

with a copy (which shall not constitute notice) to:

 

Seward & Kissel LLP

One Battery Park Plaza

New York, New York 10004

  Attention: Gary Wolfe and Michael S. Timpone

Email: wolfe@sewkis.com and timpone@sewkis.com

 

7.     Confidentiality . This Guarantee shall be treated as confidential and is being provided to the Guaranteed Party solely in connection with the Stock Purchase Agreement. This Guarantee may not be used, circulated, quoted or otherwise referred to in any document, except with the written consent of Purchaser Guarantor; provided that no such written consent shall be required for disclosures by the Guaranteed Party to the extent required by applicable Law or the applicable rules of any stock exchange.

 

 

 

 

8.     Entire Agreement . This Guarantee constitutes the entire agreement among the parties with respect to the transactions contemplated hereby and supersedes all prior negotiations, commitments, agreements and understandings among them with respect thereto, except for the Stock Purchase Agreement and the other agreements referred to therein.

 

9.     Amendments; Waiver . This Guarantee may be amended, and compliance with any provision of this Guarantee may be omitted or waived, only by the written agreement of Purchaser Guarantor and the Guaranteed Party.

 

10. Counterparts . This Guarantee may be executed in any number of counterparts, each such counterpart shall be deemed to be an original instrument, and all such counterparts together shall constitute but one agreement. Delivery of an executed copy of this Guarantee by facsimile or electronic transmission shall be deemed as effective as delivery of an originally executed copy.

 

11.   Assignment; Third party Beneficiaries . The provisions of this Guarantee shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, but neither this Guarantee nor any of the rights, interest or obligations hereunder shall be assigned by any party hereto without the prior written consent of the other parties and any purported assignment in violation hereof shall be void. The terms and conditions of this Agreement are intended solely for the benefit of the parties hereto and their respective successors and permitted assignees, and it is not the intention of the parties to confer third party beneficiary rights on any Person.

 

12.   Severability . Any provision of this Guarantee that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

13.   Governing Law . This Guarantee will be deemed to be made in and in all respects will be interpreted, construed and governed by and in accordance with the Laws of the State of New York without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than the State of New York.

 

 

 

 

14.   Jurisdiction . EACH OF THE PARTIES HERETO CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY OR IN THE FEDERAL SOUTHERN DISTRICT IN THE STATE OF NEW YORK AND ANY APPELLATE COURT THEREFROM LOCATED IN NEW YORK, NEW YORK AND IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS RELATING TO THIS GUARANTEE OR THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTEE MAY BE LITIGATED IN SUCH COURTS. EACH OF THE PARTIES HERETO ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS RESPECTIVE PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL AND NONAPPEALABLE JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS GUARANTEE OR THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTEE. EACH OF THE PARTIES HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT THE ADDRESS SPECIFIED IN THIS GUARANTEE, SUCH SERVICE TO BECOME EFFECTIVE 15 CALENDAR DAYS AFTER SUCH MAILING. NOTHING HEREIN WILL IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OF ANY PARTY HERETO TO SERVE ANY SUCH LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION OVER OR TO BRING ACTIONS, SUITS OR PROCEEDINGS AGAINST ANY OTHER PARTY HERETO IN SUCH OTHER JURISDICTIONS, AND IN SUCH MANNER, AS MAY BE PERMITTED BY ANY APPLICABLE LAW.

 

15.   Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

[Signature Page Follows]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Guarantee as of the date first written above.

 

  Purchaser GUARANTOR:
   
  INTERNATIONAL SEAWAYS, INC.
     
  By: /s/ Lois K. Zabrocky
  Name: Lois K. Zabrocky
  Title:  President and Chief Executive Officer
   
  ACCEPTED BY :
   
  GUARANTEED PARTY:
   
  EURONAV MI INC.
     
  By: /s/ Hugo De Stoop
  Name: Hugo De Stoop
  Title:  Director

 

 

 

 

 

Exhibit 4.2 

 

INTERNATIONAL SEAWAYS, INC.

 

and

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

 

as Trustee

 

INDENTURE

 

Dated as of [                  ,         ]

 

SENIOR DEBT SECURITIES

 

 

 

 

TABLE OF CONTENTS

 

Article I Definitions And Other Provisions Of General Application 1
   
Section 1.1 Definitions. 1
Section 1.2 Compliance Certificates and Opinions. 7
Section 1.3 Form of Documents Delivered to Trustee. 8
Section 1.4 Acts of Holders; Record Dates. 8
Section 1.5 Notices, Etc. to Trustee and Company. 9
Section 1.6 Notice to Holders; Waiver. 10
Section 1.7 Conflict with Trust Indenture Act. 11
Section 1.8 Effect of Headings and Table of Contents. 11
Section 1.9 Successors and Assigns. 11
Section 1.10 Separability Clause. 11
Section 1.11 Benefits of Indenture. 11
Section 1.12 Governing Law; Waiver of Jury Trial; Consent to Jurisdiction. 11
Section 1.13 Legal Holidays. 12
     
Article II Security Forms 12
   
Section 2.1 Forms Generally. 12
Section 2.2 Form of Legend for Global Securities. 13
Section 2.3 Form of Trustee’s Certificate of Authentication. 13
     
Article III The Securities 13
     
Section 3.1 Amount Unlimited; Issuable in Series. 13
Section 3.2 Denominations. 16
Section 3.3 Execution, Authentication, Delivery and Dating. 16
Section 3.4 Temporary Securities. 18
Section 3.5 Registration, Registration of Transfer and Exchange. 19
Section 3.6 Mutilated, Destroyed, Lost, and Stolen Securities. 20
Section 3.7 Payment of Interest; Interest Rights Preserved. 21
Section 3.8 Persons Deemed Owners. 22
Section 3.9 Cancellation. 23
Section 3.10 Computation of Interest. 23
Section 3.11 CUSIP Numbers. 23
     
Article IV Satisfaction and Discharge 24
   
Section 4.1 Satisfaction and Discharge of Indenture. 24
Section 4.2 Application of Trust Money. 25
     
Article V Remedies 25
   
Section 5.1 Events of Default. 25
Section 5.2 Acceleration of Maturity; Rescission and Annulment. 27

 

 

 

 

Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee. 27
Section 5.4 Trustee May File Proofs of Claim. 28
Section 5.5 Trustee May Enforce Claims Without Possession of Securities. 29
Section 5.6 Application of Money Collected. 29
Section 5.7 Limitation on Suits. 29
Section 5.8 Unconditional Right of Holders to Receive Principal, Premium, and Interest. 30
Section 5.9 Restoration of Rights and Remedies. 30
Section 5.10 Rights and Remedies Cumulative. 30
Section 5.11 Delay or Omission Not Waiver. 31
Section 5.12 Control by Holders. 31
Section 5.13 Waiver of Past Defaults. 31
Section 5.14 Undertaking for Costs. 31
     
Article VI The Trustee 32
     
Section 6.1 Certain Duties and Responsibilities. 32
Section 6.2 Notice of Defaults. 33
Section 6.3 Certain Rights of Trustee. 33
Section 6.4 Not Responsible for Recitals or Issuance of Securities. 35
Section 6.5 May Hold Securities. 35
Section 6.6 Money Held in Trust. 35
Section 6.7 Compensation and Reimbursement. 36
Section 6.8 Disqualification; Conflicting Interests. 37
Section 6.9 Corporate Trustee Required; Eligibility. 37
Section 6.10 Resignation and Removal; Appointment of Successor. 37
Section 6.11 Acceptance of Appointment by Successor. 39
Section 6.12 Merger, Conversion, Consolidation, or Succession to Business. 40
Section 6.13 Preferential Collection of Claims Against Company. 40
Section 6.14 Appointment of Authenticating Agent. 41
     
Article VII Holder’s Lists and Reports by Trustee and Company 43
     
Section 7.1 Company to Furnish Trustee Names and Addresses of Holders. 43
Section 7.2 Preservation of Information; Communications to Holders. 43
Section 7.3 Reports by Trustee. 43
Section 7.4 Reports by Company. 44
   
Article VIII Consolidation, Merger, Conveyance, Transfer or Lease 44
     
Section 8.1 Company May Consolidate, Etc., Only on Certain Terms. 44
Section 8.2 Successor Substituted. 45
     
Article IX Supplemental Indentures 45
   
Section 9.1 Supplemental Indentures Without Consent of Holders. 45
Section 9.2 Supplemental Indentures With Consent of Holders. 46

 

 

 

 

Section 9.3 Execution of Supplemental Indentures. 47
Section 9.4 Effect of Supplemental Indentures. 47
Section 9.5 Conformity With Trust Indenture Act. 47
Section 9.6 Reference in Securities to Supplemental Indentures. 48
Section 9.7 Notice of Supplemental Indentures. 48
     
Article X Covenants 48
     
Section 10.1 Payment of Principal, Premium, and Interest. 48
Section 10.2 Maintenance of Office or Agency. 48
Section 10.3 Money for Securities Payments to Be Held in Trust. 49
Section 10.4 Statement by Officers as to Default. 50
Section 10.5 Existence. 50
     
Article XI Redemption of Securities 50
   
Section 11.1 Applicability of Article. 50
Section 11.2 Election to Redeem; Notice to Trustee. 50
Section 11.3 Selection by Trustee of Securities to Be Redeemed. 51
Section 11.4 Notice of Redemption. 51
Section 11.5 Deposit of Redemption Price. 52
Section 11.6 Securities Payable on Redemption Date. 52
Section 11.7 Securities Redeemed in Part. 53
     
Article XII Sinking Funds 53
     
Section 12.1 Applicability of Article. 53
Section 12.2 Satisfaction of Sinking Fund Payments with Securities. 53
Section 12.3 Redemption of Securities for Sinking Fund. 53
     
Article XIII Defeasance and Covenant Defeasance 54
   
Section 13.1 Applicability of Article; Company’s Option to Effect Defeasance or Covenant Defeasance. 54
Section 13.2 Defeasance and Discharge. 54
Section 13.3 Covenant Defeasance. 55
Section 13.4 Conditions to Defeasance or Covenant Defeasance. 55
Section 13.5 Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions. 57
Section 13.6 Reinstatement. 57

 

NOTE: This table of contents shall not, for any purpose, be deemed to be part of the Indenture.

 

 

 

 

INTERNATIONAL SEAWAYS, INC.

Certain Sections of this Indenture relating to

Sections 310 through 318, inclusive, of the

Trust Indenture Act of 1939:

 

Trust Indenture Act Section  

Indenture Section

§310 (a)(1)   6.9
  (a)(2)   6.9
  (a)(3)   Not Applicable
  (a)(4)   Not Applicable
  (b)   6.8
      6.10
§311 (a)   6.13
  (b)   6.13
§312 (a)   7.1
  (b)   7.2(a)
  (c)   7.2(b)
§313 (a)   7.3(a)
  (b)   7.3(a)
  (c)   7.3(a)
  (d)   7.3(b)
§314 (a)   7.4
  (a)(4)   1.2
      10.4
  (b)   Not Applicable
  (c)(1)   1.2
  (c)(2)   1.2
  (c)(3)   Not Applicable
  (d)   Not Applicable
  (e)   1.2
§315 (a)   6.1
  (b)   6.2
  (c)   6.1
  (d)   6.1
  (d)(1)   6.1
  (d)(2)   6.1
  (d)(3)   6.1
  (e)   5.14
§316 (a)(1)(A)   5.12
  (a)(1)(B)   5.2
      5.13
  (a)(2)   Not Applicable
  (b)   5.8
  (c)   1.4(c)
§317 (a)(1)   5.3
  (a)(2)   5.4
  (b)   10.3
§318 (a)   1.7

 

NOTE: This shall not, for any purpose, be deemed to be part of the Indenture.

 

 

 

 

INDENTURE , dated as of [                 ,        ], between INTERNATIONAL SEAWAYS, INC., a corporation duly organized and existing under the laws of the Marshall Islands (the “Company”), having its principal office at 600 Third Avenue, 39th Floor, New York, New York, and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as Trustee (the “Trustee”).

 

RECITALS OF THE COMPANY

 

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its senior, unsecured debentures, notes, or other evidences of indebtedness (the “Securities”), to be issued in one or more series as provided in this Indenture.

 

All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Securities by the Holders, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Securities or of any series of the Securities, as follows:

 

Article I


Definitions And Other Provisions Of General Application

 

Section 1.1 Definitions .

 

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

 

(1)       the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

 

(2)       all other terms used in this Indenture which are defined in the Trust Indenture Act, either directly or by reference to the Trust Indenture Act, have the meanings assigned to them in the Trust Indenture Act;

 

(3)       all accounting terms not otherwise defined in this Indenture have the meanings assigned to them in accordance with accounting principles generally accepted in the United States and, except as otherwise expressly provided in this Indenture, the term “accounting principles generally accepted in the United States” with respect to any computation required or permitted under this Indenture shall mean such accounting principles as are generally accepted in the United States at the date hereof;

 

(4)       the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision; and

 

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(5)       unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or a Section, as the case may be, of this Indenture.

 

“Act”, when used with respect to any Holder, has the meaning specified in Section 1.4(a).

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract, or otherwise; and the terms “controlling” and “controlled” have the meanings correlative to the foregoing.

 

“Authenticating Agent” means any Person authorized by the Trustee pursuant to Section 6.14 to act on behalf of the Trustee to authenticate Securities of one or more series.

 

“Authorized Officer” means any officer of the Company designated by or pursuant to a Board Resolution to take certain actions as specified in this Indenture.

 

“Board of Directors” means either the board of directors of the Company or any other duly authorized committee of that board.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors, or by action of an Authorized Officer designated as such pursuant to a resolution of the Board of Directors, and to be in full force and effect on the date of such certification, and delivered to the Trustee.

 

“Business Day” means, unless otherwise specified, any day that is not a Saturday or Sunday and that is not a day on which banking institutions are authorized or required by law, regulation or executive order to be closed in The City of New York, New York or a day on which the Corporate Trust Office is closed.

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Company” means the Person named as the “Company” in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

 

“Company Request” or “Company Order” means a written request or order signed in the name of the Company by its Chairman, its Chief Executive Officer, its President, its Chief Financial Officer, or a Vice President, and by its Treasurer, an Assistant Treasurer, its Controller, an Assistant Controller, its Secretary, or an Assistant Secretary, and delivered to the Trustee.

 

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“Corporate Trust Office” means the office of the Trustee at which any particular time its corporate trust business in Pittsburgh, Pennsylvania shall be principally administered, which office as of the date of this instrument is located at 525 William Penn Place, 38 th Floor, Pittsburgh, Pennsylvania 15259, except that with respect to presentation of Securities for payment or for registration of transfer or exchange, such term shall mean the office or agency of the Trustee at which at any particular time its corporate agency business shall be conducted, which office at the date of this instrument is located at 101 Barclay Street, New York, New York 10286; Attention: Corporate Trust Division—Corporate Finance Unit, or, in the case of any of such offices or agency, such other address as the Trustee may designate from time to time by notice to the Company.

 

“Covenant Defeasance” has the meaning specified in Section 13.3.

 

“Debt” means, with respect to any Person at any date of determination (without duplication):

 

(i) all debt of such Person for borrowed money,

 

(ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments,

 

(iii) all obligations of such Person in respect of letters of credit or other similar instruments (including reimbursement obligations with respect thereto),

 

(iv) all obligations of such Person to pay the deferred purchase price of property or services, which purchase price is due more than six months after the date of placing such property in service or taking delivery thereto or the completion of such services, except trade payables,

 

(v) all obligations of such Person as lessee under Capitalized Leases,

 

(vi) Debt of Persons other than such Person secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such Person; provided that the amount of such Debt shall be the lesser of (A) the fair market value of such asset at such date of determination and (B) the amount of such Debt, and

 

(vii) all Debt of Persons other than such Person guaranteed by such Person to the extent such Debt is guaranteed by such Person.

 

“Defaulted Interest” has the meaning specified in Section 3.7.

 

“Defeasance” has the meaning specified in Section 13.2.

 

“Depositary” means, with respect to the Securities of any series issuable or issued in whole or in part in the form of one or more Global Securities, the Person designated as Depositary for such series by the Company pursuant to Section 3.1, which Person shall be a clearing agency registered under the Exchange Act.

 

“Event of Default” has the meaning specified in Section 5.1.

 

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“Exchange Act” means the Securities Exchange Act of 1934, as amended now or in the future, and any successor statute.

 

“Global Security” means a Security bearing the legend prescribed in Section 2.2 evidencing all or part of a series of Securities, authenticated and delivered to the Depositary for such series or its nominee, and registered in the name of such Depositary or nominee.

 

“Holder” means a Person in whose name a Security is registered in the Security Register.

 

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more supplemental indentures entered into pursuant to the applicable provisions of this Indenture, including, for all purposes of this Indenture and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this Indenture and any such supplemental indenture, respectively. The term “Indenture” shall also include the terms of particular series of Securities established as contemplated by Section 3.1.

 

“Interest Payment Date”, with respect to any Security, means the Stated Maturity of an installment of interest on such Security.

 

“Lien” means, any mortgage, lien, pledge, security interest, encumbrance or charge of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof, any sale with recourse against the seller or any Affiliate of the seller, or any agreement to give any security interest).

 

“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable in accordance with its terms or the terms of this Indenture, whether at the Stated Maturity or by declaration of acceleration, call for redemption, or otherwise.

 

“Officers’ Certificate” means a certificate signed by the Chairman, the Chief Executive Officer, the President, the Chief Financial Officer, or a Vice President, and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary, or an Assistant Secretary, of the Company, and delivered to the Trustee. One of the officers signing an Officers’ Certificate given pursuant to Section 10.4 shall be the principal executive, financial, or accounting officer of the Company.

 

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for the Company, and who, in all cases, shall be reasonably acceptable to the Trustee.

 

“Original Issue Discount Security” means any Security which provides for an amount less than the principal amount of such Security to be due and payable upon a declaration of acceleration of the Maturity of such Security pursuant to Section 5.2.

 

“Outstanding”, when used with respect to Securities, means, as of the date of determination, all Securities previously authenticated and delivered under this Indenture, except :

 

  4  

 

 

(i) Securities previously cancelled by the Trustee or delivered to the Trustee for cancellation;

 

(ii) Securities for whose payment or redemption money in the necessary amount has been previously deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision for such redemption satisfactory to the Trustee has been made;

 

(iii) Securities which have been paid pursuant to Section 3.6 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a protected purchaser in whose hands such Securities are valid obligations of the Company;

 

(iv) Securities which have been defeased pursuant to Section 13.2; and

 

(v) Securities not deemed outstanding pursuant to Section 11.3;

 

provided , however , that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent, or waiver under this Indenture, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding shall be the amount of the principal that would be due and payable as of the date of such determination upon acceleration of its maturity pursuant to Section 5.2, (ii) if, as of such date, the principal amount payable at the Stated Maturity of a Security is not determinable, the principal amount of such Security which shall be deemed to be Outstanding shall be the amount as specified or determined as contemplated by Section 3.1, and (iii) Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or any such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, or waiver, only Securities which a Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or any such other obligor.

 

“Paying Agent” means any Person authorized by the Company to pay the principal of or any premium or interest on any Securities on behalf of the Company.

 

“Periodic Offering” means an offering of Securities of any series from time to time, the specific terms of which Securities, including, without limitation, its rate or rates of interest, if any, its Stated Maturity, and redemption provisions, if any, with respect to such Securities are to be determined by the Company or its agents upon the issuance of such Securities.

 

  5  

 

 

“Person” means any individual, corporation, limited liability company, partnership, joint venture, trust, association, unincorporated organization, or government or any agency or political subdivision of any government.

 

“Place of Payment”, when used with respect to the Securities of any series, means the place or places where the principal of and any premium and interest on the Securities of that series are payable as specified as contemplated by Section 3.1.

 

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 3.6 in exchange for or in lieu of a mutilated, destroyed, lost, or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost, or stolen Security.

 

“Redemption Date”, when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

 

“Redemption Price”, when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

 

“Regular Record Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by Section 3.1.

 

“Responsible Officer”, when used with respect to the Trustee, means any officer assigned to the Corporate Trust Division—Corporate Finance Unit (or any successor division or unit) of the Trustee located at the Corporate Trust Office of the Trustee, who shall have direct responsibility for the administration of this Indenture, and for the purposes of Sections, 5.12(3), 6.1(c)(2) and 6.2 shall also include any other officer of the Trustee to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

 

“Securities” has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.

 

“Security Register” and “Security Registrar” have the respective meanings specified in Section 3.5.

 

“Significant Subsidiary” means the “significant subsidiaries” or any “significant subsidiary” of the Company, as defined in Rule 1-02(w) of Regulation S-X under the Securities Act.

 

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 3.7.

 

“Stated Maturity”, when used with respect to any Security or any installment of principal or interest on such Security, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.

 

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“Subsidiary” means a corporation or other Person more than 50% of the outstanding voting stock or a majority of the controlling interest of which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the purposes of this definition, “voting stock” means stock which ordinarily has voting power for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by reason of any contingency.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee under this Indenture, and if at any time there is more than one such Person, “Trustee”, as used with respect to the Securities of any series, shall mean the Trustee with respect to Securities of that series.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as in force at the date as of which this Indenture was executed; provided , however , that in the event the Trust Indenture Act of 1939 is amended after such date, “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939, as so amended.

 

“U.S. Government Obligation” has the meaning specified in Section 13.4.

 

“Vice President”, when used with respect to the Company or the Trustee, means any vice president (other than any assistant vice president), whether or not designated by a number or a word or words added before or after the title “vice president”.

 

Section 1.2 Compliance Certificates and Opinions .

 

Upon any application to or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except in the case of any such application or request as to which the furnishing of such documents is specifically required by any provisions of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

 

Every certificate or opinion (other than the Officers’ Certificate delivered under Section 10.4 of this Indenture) with respect to compliance with a condition or covenant provided for in this Indenture shall include:

 

(1)       a statement that each individual signing such certificate or opinion has read such covenant or condition and the related definitions;

 

(2)       a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

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(3)       a statement that, in the opinion of each such individual, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)       a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

 

Section 1.3 Form of Documents Delivered to Trustee .

 

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

 

Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which this certificate or opinion is based are erroneous. Any such certificate or opinion of counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

 

Where any Person is required to make, give, or execute two or more applications, requests, consents, certificates, statements, opinions, or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

 

Section 1.4 Acts of Holders; Record Dates .

 

(a)       Any request, demand, authorization, direction, notice, consent, waiver, or other action provided or permitted by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as otherwise expressly provided in this Indenture, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is expressly required by this Indenture, to the Company. Such instrument or instruments (and the action embodied in and evidenced by such instrument or instruments) are sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.1) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.

 

Without limiting the generality of the foregoing, a Holder, including a Depositary that (or whose nominee) is a Holder of a Global Security, may make, give, or take, by a proxy or proxies, duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver, or other action provided or permitted in this Indenture to be made, given, or taken by Holders, and a Depositary that (or whose nominee) is a Holder of a Global Security may provide its proxy or proxies to the beneficial owners of interests in any such Global Security.

 

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(b)       The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him its execution. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

 

(c)       The Company may fix any day as the record date for the purpose of determining the Holders of Securities of any series entitled to give or take any request, demand, authorization, direction, notice, consent, waiver, or other action, or to vote on any action, authorized, or permitted to be given or taken by Holders of Securities of such series. If not set by the Company prior to the first solicitation of a Holder of Securities of such series made by any Person in respect of any such action, or, in the case of any such vote, prior to such vote, the record date for any such action or vote shall be the 30th day (or, if later, the date of the most recent list of Holders required to be provided pursuant to Section 7.1) prior to such first solicitation or vote, as the case may be. With regard to any record date for action to be taken by the Holders of one or more series of Securities, only the Holders of Securities of such series on such date (or their duly designated proxies) shall be entitled to give, take, or vote on the relevant action.

 

(d)       The ownership of Securities shall be proved by the Security Register.

 

(e)       Any request, demand, authorization, direction, notice, consent, waiver, or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer of, in exchange for, or in lieu of such Security in respect of anything done, omitted, or suffered to be done by the Trustee or the Company in reliance on such action, whether or not notation of such action is made upon such Security.

 

(f)       Without limiting the foregoing, a Holder entitled to give or take any action under this Indenture with regard to any particular Security may do so with regard to all or any part of the principal amount of such Security or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any different part of such principal amount.

 

Section 1.5 Notices, Etc. to Trustee and Company .

 

Any request, demand, authorization, direction, notice, consent, waiver, or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

 

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(1)       the Trustee by any Holder or by the Company shall be sufficient for every purpose under this Indenture if made, given, furnished, or filed in writing to or with the Trustee at its Corporate Trust Office, Attention: Corporate Trust Division—Corporate Finance Unit, or

 

(2)       the Company by the Trustee or by any Holder shall be sufficient for every purpose under this Indenture (unless otherwise expressly provided in this Indenture) if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first paragraph of this instrument or at any other address previously furnished in writing to the Trustee by the Company, Attention: Corporate Secretary.

 

The Trustee shall have the right, but shall not be required, to rely upon and comply with notices, instructions, directions or other communications sent by e-mail, facsimile and other similar unsecured electronic methods by persons believed by the Trustee to be authorized to give instructions and directions on behalf of the Company. The Trustee shall have no duty or obligation to verify or confirm that the person who sent such instructions or directions is, in fact, a person authorized to give instructions or directions on behalf of the Company; and the Trustee shall have no liability for any losses, liabilities, costs or expenses incurred or sustained by the Company as a result of such reliance upon or compliance with such notices, instructions, directions or other communications. The Company agrees to assume all risks arising out of the use of such electronic methods to submit notices, instructions, directions or other communications to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties. The Company shall use all reasonable endeavors to ensure that any such notices, instructions, directions or other communications transmitted to the Trustee pursuant to this Indenture are complete and correct. Any such notices, instructions, directions or other communications shall be conclusively deemed to be valid instructions from the Company to the Trustee for the purposes of this Indenture.

 

Section 1.6 Notice to Holders; Waiver .

 

Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise expressly provided in this Indenture) if in writing and (i) mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Security Register, or (ii) in the event that a Depositary (or a nominee thereof) is a Holder of Securities issued in the form of Global Securities, then with respect to such Securities given by electronic, email or other means as such be acceptable to such Depositary, in all cases, not later than the latest date (if any), and not earlier than the earliest date (if any), prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

 

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose under this Indenture.

 

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Section 1.7 Conflict with Trust Indenture Act .

 

If any provision of this Indenture limits, qualifies, or conflicts with a provision of the Trust Indenture Act that is required under such Act to be a part of and govern this Indenture, the latter provision shall control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, such provision shall be deemed to apply to this Indenture as so modified or to be excluded, as the case may be.

 

Section 1.8 Effect of Headings and Table of Contents .

 

The Article and Section headings in this Indenture and the Table of Contents are for convenience only and shall not affect the construction of this Indenture.

 

Section 1.9 Successors and Assigns .

 

All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

 

Section 1.10 Separability Clause .

 

In case any provision in this Indenture or in the Securities shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired by such invalid, illegal, or unenforceable provision.

 

Section 1.11 Benefits of Indenture .

 

Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties to this Indenture and their successors under this Indenture, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

Section 1.12 Governing Law; Waiver of Jury Trial; Consent to Jurisdiction .

 

This Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York (including but not limited to N.Y. General Obligations Law Section 5-1401 and any successor statute thereto).

 

Each of the Company and the Trustee, and each Holder of a Security by its acceptance thereof, hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right it may have to trial by jury in any legal proceeding directly or indirectly arising out of or relating to this Indenture, the Securities or the transactions contemplated hereby or thereby.

 

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Each of the Company and the Trustee irrevocably consents and submits, for itself and in respect of any of its assets or property, to the nonexclusive jurisdiction of any court of the State of New York or any United States court sitting, in each case, in the Borough of Manhattan, The City of New York, New York, United States of America, and of any appellate court in respect thereof in any suit, action or proceeding that may be brought in connection with this Indenture or the Securities, and waives any immunity from the jurisdiction of such courts. Each of the Company and the Trustee irrevocably waives, to the fullest extent permitted by law, any objection to any such suit, action or proceeding that may be brought in such courts whether on the grounds of venue, residence or domicile or on the ground that any such suit, action or proceeding has been brought in an inconvenient forum. Each of the Company and the Trustee agrees, to the fullest extent that it lawfully may do so, that final judgment in any such suit, action or proceeding brought in such a court shall be conclusive and binding upon the Company and the Trustee, respectively, and the Company waives, to the fullest extent permitted by law, any objection to the enforcement by any competent court in the Company’s jurisdiction of organization of judgments validly obtained in any such court in New York on the basis of such suit, action or proceeding.

 

Section 1.13 Legal Holidays .

 

In any case where any Interest Payment Date, Redemption Date, or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities, other than a provision of the Securities of any series which specifically states that such provision shall apply in lieu of this Section) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date, or Redemption Date, or at the Stated Maturity, provided that, if such payment is made on such next succeeding Business Day, no interest shall accrue with respect to the payment due on such date for the period from and after such Interest Payment Date, Redemption Date, or Stated Maturity, as the case may be.

 

Article II

Security Forms

Section 2.1 Forms Generally .

 

The Securities of each series shall be in substantially such form or forms as shall be established by or pursuant to one or more Board Resolutions or in one or more indentures supplemental to this Indenture, or in an Officer’s Certificate pursuant to such Board Resolution or any such supplemental indenture, in each case with such appropriate insertions, omissions, substitutions, and other variations as are required or permitted by this Indenture, and may have such letters, numbers, or other marks of identification and such legends or endorsements placed on them as may be required to comply with the rules of any securities exchange or as may, consistently with this Indenture, be determined by the officers executing such Securities, as evidenced by their execution of the Securities. If the form of Securities of any series is established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 3.3 for the authentication and delivery of such Securities.

 

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The definitive Securities, if any, shall be printed, lithographed, or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities.

 

Section 2.2 Form of Legend for Global Securities .

 

Any Global Security authenticated and delivered under this Indenture shall bear a legend (in addition to any legend that may be required by the applicable requirements of the Depositary) in substantially the following form:

 

“This Security is a Global Security within the meaning of the Indenture referred to in this Security and is registered in the name of a Depositary or its nominee. This Security may not be transferred to, or registered or exchanged for Securities registered in the name of, any Person other than the Depositary or its nominee or a successor of such Depositary or a nominee of such successor and no such transfer may be registered, except in the limited circumstances described in the Indenture. Every Security authenticated and delivered upon registration of transfer of, or in exchange for or in lieu of, this Security shall be a Global Security subject to the foregoing, except in such limited circumstances.”

 

Section 2.3 Form of Trustee’s Certificate of Authentication .

 

The Trustee’s certificates of authentication shall be in substantially the following form:

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

Date: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
   
  By:  
    Authorized Signatory

 

Article III

The Securities

 

Section 3.1 Amount Unlimited; Issuable in Series .

 

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

 

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The Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution and, subject to Section 3.3, set forth, or determined in the manner provided, in an Officers’ Certificate pursuant to a Board Resolution or indenture supplemental to this Indenture, or established in one or more indentures supplemental to this Indenture, prior to the issuance of Securities of any series,

 

(1)       the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series);

 

(2)       any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 3.4, 3.5, 3.6, 9.6, or 11.7 and except for any Securities which, pursuant to Section 3.3, are deemed never to have been authenticated and delivered under this Indenture);

 

(3)       the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on Regular Record Date for such interest;

 

(4)       the date or dates on which the principal (and premium, if any) of the Securities of the series is payable;

 

(5)       the rate or rates at which the Securities of the series shall bear interest, if any, the date or dates from which such interest shall accrue, the Interest Payment Dates on which any such interest shall be payable, and the Regular Record Date for any interest payable on any Interest Payment Date;

 

(6)       the right, if any, to extend the interest payment periods and the duration of any such deferral period, including the maximum consecutive period during which interest payment periods may be extended;

 

(7)       the place or places in addition to the Borough of Manhattan, The City of New York, if any, where the principal of and any premium and interest on Securities of the series shall be payable;

 

(8)       the period or periods within which, the price or prices at which, and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Company and, if other than by a Board Resolution, the manner in which any election by the Company to redeem the Securities shall be evidenced;

 

(9)       the obligation, if any, of the Company to redeem, purchase, or repay Securities of the series pursuant to any mandatory redemption, sinking fund, or analogous provision or at the option of a Holder of the Security, and the period or periods within which, the price or prices at which, and the terms and conditions upon which Securities of the series shall be redeemed, purchased, or repaid, in whole or in part, pursuant to such obligation;

 

(10)       if other than denominations of $1,000 and integral multiples of such denomination, the denomination or denominations in which Securities of the series shall be issuable;

 

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(11)       if the amount of payments of principal of or any premium or interest on any Securities of the series may be determined with reference to an index or formula, the manner in which such amounts shall be determined;

 

(12)       if other than the principal amount of the Securities of the series, the portion of the principal amount of Securities which shall be payable upon declaration of acceleration of its Maturity pursuant to Section 5.2;

 

(13)       if the principal amount payable at the Stated Maturity of any Securities of the series will not be determinable as of any one or more dates prior to the Stated Maturity, the amount which shall be deemed to be the principal amount of such Securities as of any such date for any purpose under the Securities or this Indenture, including the principal amount which shall be due and payable upon any Maturity other than the Stated Maturity or which shall be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in any such case, the manner in which such amount deemed to be the principal amount shall be determined);

 

(14)       the application, if any, of either or both of Section 13.2 and Section 13.3 to the Securities of the series (including, in the case of Section 13.3, the covenants and any Events of Default not specified therein that are subject thereto) and, if other than by a Board Resolution, the manner in which any election pursuant to such Sections by the Company shall be evidenced;

 

(15)       whether the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depositary or Depositaries for such Global Security or Global Securities (if other than The Depository Trust Company), and any circumstances other than those set forth in Section 3.5 in which any such Global Security may be transferred to, and registered and exchanged for, Securities registered in the name of, a Person other than the Depositary for such Global Security or its nominee and in which any such transfer may be registered;

 

(16)       any Authenticating Agents, Paying Agents, or any other agents with respect to the Securities of the series;

 

(17)       any other covenant or warranty included for the benefit of Securities of the series in addition to (and not inconsistent with) those included in this Indenture for the benefit of Securities of all series, or any other covenant or warranty included for the benefit of Securities of the series in lieu of any covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenant contained in Article X), or any provision that any covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenant contained in Article X) shall not be for the benefit of Securities of such series, or any change to or combination of the provisions of any such covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenants contained in Article X) which applies to the Securities of such series;

 

(18)       any addition to, deletion from, or change in the Events of Default which applies to any Securities of the series and any change in the right of the Trustee or the requisite Holders of such Securities to declare the principal amount of such Securities due and payable pursuant to Section 5.2;

 

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(19)       the terms, if any, upon which the Securities of the series may be convertible into or exchanged for other securities of the Company and the terms and conditions upon which such conversion or exchange shall be effected; and

 

(20)       any other terms of the Securities of such series, or of any specified tenor thereof.

 

All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and (subject to Section 3.3) set forth, or determined in the manner provided, in the Officers’ Certificate referred to above or in any indenture supplemental to this Indenture.

 

Unless otherwise provided with respect to the Securities of any series, at the option of the Company, interest on the Securities of any series that bears interest may be paid by mailing a check to the address of the Person entitled to such interest as such address shall appear in the Security Register.

 

If any of the terms of the series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers’ Certificate setting forth the terms of the series.

 

Section 3.2 Denominations .

 

The Securities of each series shall be issuable in registered form without coupons in such denominations as shall be specified as contemplated by Section 3.1. In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiples of such denomination.

 

Section 3.3 Execution, Authentication, Delivery and Dating .

 

The Securities shall be executed on behalf of the Company by its Chairman, its Chief Executive Officer, its President, or one of its Vice Presidents, and may (but need not) have the corporate seal of the Company affixed or reproduced thereon and, if so affixed or reproduced, attested by its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the Securities may be manual or facsimile.

 

Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities.

 

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with the documents referred to below in this Section 3.3, for the authentication and delivery of such Securities, and the Trustee shall authenticate and deliver such Securities to or upon a Company Order or pursuant to such procedures acceptable to the Trustee and to such recipients as may be specified from time to time by a Company Order. If so provided in or pursuant to the Board Resolution or supplemental indenture establishing the Securities of any series, the maturity date, original issue date, interest rate, and any other terms of any or all of the Securities of such series may be determined by or pursuant to such Company Order and procedures. If provided for in such procedures, such Company Order may authorize authentication and delivery pursuant to electronic instructions from the Company or its duly authorized agent, which instructions shall be promptly confirmed in writing. In authenticating such Securities and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive and (subject to Section 6.1) shall be fully protected in relying upon, unless and until such documents have been superseded or revoked:

 

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(a)       a Company Order requesting such authentication and setting forth delivery instructions if the Securities are not to be delivered to the Company, provided that, with respect to Securities of a series subject to a Periodic Offering, (i) such Company Order may be delivered by the Company to the Trustee at any time prior to the delivery to the Trustee of the Securities of such series for authentication and delivery, (ii) the Trustee shall authenticate and deliver the Securities of such series for original issue from time to time, in an aggregate principal amount not exceeding the aggregate principal amount established for such series, pursuant to a Company Order or pursuant to such procedures acceptable to the Trustee as may be specified from time to time by a Company Order, and (iii) if so provided in or pursuant to the Board Resolution or supplemental indenture establishing the Securities of such series, the maturity date, original issue date, interest rate, and any other terms of any or all of the Securities of such series may be determined by a Company Order or pursuant to such procedures;

 

(b)       any Board Resolution, Officers’ Certificate and/or executed supplemental indenture referred to in Sections 2.1 and 3.1 by or pursuant to which the form or forms and terms of the Securities of such series were established;

 

(c)       an Officers’ Certificate setting forth the form or forms and the terms of the Securities of such series, stating that such form or forms and terms have been established pursuant to Sections 2.1 and 3.1 and comply with this Indenture, and covering such other matters as the Trustee may reasonably request; and

 

(d)       an Opinion of Counsel, substantially to the effect that:

 

(i)       the form or forms of the Securities of such series have been duly authorized and established in conformity with the provisions of this Indenture;

 

(ii)       the terms of the Securities of such series (or the manner of determining such terms) have been established in conformity with the provisions of this Indenture; and

 

(iii)       that such Securities, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and similar laws of general applicability relating to or affecting creditors rights and to general equity principles and other customary qualifications and assumptions.

 

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The Trustee shall not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee’s own rights, duties, liabilities or immunities under the Securities or this Indenture or otherwise.

 

Notwithstanding the provisions of Section 3.1 and of the preceding paragraph, if all Securities of a series are not to be originally issued at one time, it shall not be necessary to deliver the above specified documents at or prior to the time of authentication of each Security of such series if such documents are delivered at or prior to the authentication upon original issuance of the first Security of such series to be issued.

 

Each Security shall be dated the date of its authentication.

 

No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for in this Indenture executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered under this Indenture. Notwithstanding the foregoing, if any Security shall have been authenticated and delivered but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 3.9, for all purposes of this Indenture, such Security shall be deemed never to have been authenticated and delivered under this Indenture and shall never be entitled to the benefits of this Indenture.

 

Section 3.4 Temporary Securities .

 

Pending the preparation of definitive Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed, or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions, and other variations as the officers executing such Securities may determine, as evidenced by their execution of such Securities.

 

If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange one or more definitive Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series and tenor.

 

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Section 3.5 Registration, Registration of Transfer and Exchange .

 

The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office or in any other office or agency of the Company in a Place of Payment may sometimes be collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee is hereby appointed “Security Registrar” for the purpose of registering Securities and transfers of Securities as provided in this Indenture.

 

Upon surrender for registration of transfer of any Security of any series at the office or agency of the Company in a Place of Payment for that series, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor.

 

At the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor, upon surrender of the Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive.

 

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

 

Every Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed, by the Holder or his attorney duly authorized in writing.

 

No service charge shall be made for any registration of transfer or exchange of Securities, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.4, 9.6, or 11.7 not involving any transfer.

 

The Company shall not be required (i) to issue, register the transfer of, or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 11.3 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.

 

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Notwithstanding the foregoing and except as otherwise specified as contemplated by Section 3.1, if at any time the Depositary for the Securities of a series represented by a Global Security or Global Securities notifies the Company that it is unwilling or unable to continue as a Depositary for the Securities of such series or if at any time the Depositary for Securities of a series shall no longer be registered or in good standing under the Exchange Act or other applicable statute or regulation, the Company shall appoint a successor Depositary with respect to the Securities of such series. If a successor Depositary for the Securities of such series is not appointed by the Company or, if appointed, has not accepted such appointment, within 90 days after the Company receives such notice or becomes aware of such condition, the Company will execute, and the Trustee, upon Company Request, will authenticate and deliver, Securities of such series in definitive form in an aggregate principal amount equal to the principal amount of the Global Security or Global Securities representing Securities of such series in exchange for such Global Security or Global Securities.

 

In the event that (i) the Company at any time and in its sole discretion determines that the Securities of any series issued in the form of one or more Global Securities shall no longer be represented by such Global Security or Global Securities or (ii) there shall have occurred and be continuing an Event of Default with respect to the Securities of any series, the Company will execute, and the Trustee, upon Company Request or instructions from the Depositary, will authenticate and deliver, Securities of such series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or Global Securities representing such series in exchange for such Global Security or Global Securities.

 

Upon the occurrence in respect of any Global Security of any series of any one or more of the conditions specified in the preceding two paragraphs or such other conditions as may be specified as contemplated by Section 3.1 for such series, such Global Security may be exchanged for Securities registered in the names of, and the transfer of such Global Security may be registered to, such Persons (including Persons other than the Depositary with respect to such series and its nominees) as such Depositary shall direct. Notwithstanding any other provision of this Indenture, any Security authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, any Global Security shall also be a Global Security and shall bear the legend or legends specified in Section 2.2 except for any Security authenticated and delivered in exchange for, or upon registration of transfer of, a Global Security pursuant to the preceding sentence.

 

Section 3.6 Mutilated, Destroyed, Lost, and Stolen Securities .

 

If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss, or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a protected purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost, or stolen Security, a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

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In case any such mutilated, destroyed, lost, or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

 

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation to such issuance and any other expenses (including the fees and expenses of the Trustee) connected with such issuance.

 

Every new Security of any series issued pursuant to this Section in lieu of any destroyed, lost, or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost, or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that series duly issued under this Indenture.

 

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost, or stolen Securities.

 

Section 3.7 Payment of Interest; Interest Rights Preserved .

 

Except as otherwise provided as contemplated by Section 3.1 with respect to any series of Securities, interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest.

 

Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (“Defaulted Interest”) shall cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in clause (1) or (2) below:

 

(1)       The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause. At such time the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the related Special Record Date to be mailed, first-class postage prepaid, to each Holder of Securities of such series at his address as it appears in the Security Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the related Special Record Date having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (2).

 

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(2)       The Company may make payment to Holders of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

 

Section 3.8 Persons Deemed Owners .

 

Prior to due presentment of a Security for registration of transfer, the Company, the Trustee, and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and any premium and (subject to Section 3.7) any interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee, nor an agent of the Company or the Trustee shall be affected by notice to the contrary.

 

No holder of any beneficial interest in any Global Security registered in the name of a Depositary or its nominee shall have any rights under this Indenture with respect to such Global Security, and such Depositary or nominee, as the case may be, may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing in this Indenture shall prevent the Company, the Trustee, or any agent of the Company or the Trustee from giving effect to any written certification, proxy, or other authorization furnished by a Depositary or its nominee pursuant to this Indenture. Furthermore, none of the Company, the Trustee, any Paying Agent, the Security Registrar, or any other agent of the Company or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in any such Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. The Company, the Trustee, any Paying Agent, the Security Registrar, or any other agent of the Company or the Trustee shall be entitled to deal with the Depositary, and any nominee thereof, that is the registered holder of any Global Security for all purposes of this Indenture relating to such Global Security (including the payment of principal, premium, if any, and interest and additional amounts, if any, and the giving of instructions or directions by or to the owner or holder of a beneficial ownership interest in such Global Security) as the sole holder of such Global Security and shall have no obligations to the beneficial owners thereof. None of the Trustee, the Paying Agent or the Security Registrar shall have any responsibility or liability for any acts or omissions of the Depositary with respect to such Global Security, for the records of any such depositary, including records in respect of beneficial ownership interests in respect of any such Global Security, for any transactions between the Depositary and any Depositary participant or between or among the Depositary, any such Depositary participant and/or any holder or owner of a beneficial interest in such Global Security, or for any transfers of beneficial interests in any such Global Security.

 

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Section 3.9 Cancellation .

 

All Securities surrendered for payment, conversion, redemption, registration of transfer or exchange, or for credit against any sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered which the Company may have acquired in any manner whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities previously authenticated which the Company has not issued and sold, and all Securities so delivered shall be promptly cancelled by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of by the Trustee in accordance with its then customary procedures.

 

Section 3.10 Computation of Interest .

 

Except as otherwise specified as contemplated by Section 3.1 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months.

 

Section 3.11 CUSIP Numbers .

 

The Company in issuing the Securities may use “CUSIP”, “ISIN” or other similar numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP”, “ISIN” or other similar numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee in writing of any change in “CUSIP”, “ISIN” or other similar numbers.

 

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Article IV

Satisfaction and Discharge

 

Section 4.1 Satisfaction and Discharge of Indenture .

 

This Indenture shall upon Company Request cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities expressly provided for in this Indenture), and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when

 

(1)       either:

 

(A)       all Securities previously authenticated and delivered (other than (i) Securities which have been destroyed, lost, or stolen and which have been replaced or paid as provided in Section 3.6 and (ii) Securities for whose payment money has previously been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in Section 10.3) have been delivered to the Trustee for cancellation; or

 

(B)     all such Securities not previously delivered to the Trustee for cancellation

 

(i)       have become due and payable, or

 

(ii)      will become due and payable at their Stated Maturity within one year, or

 

(iii)     are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company,

 

and the Company, in the case of (i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee as trust funds in trust for the purpose an amount sufficient to pay and discharge the entire indebtedness on such Securities not previously delivered to the Trustee for cancellation (other than Securities which have been destroyed, lost, or stolen and which have been replaced or paid as provided in Section 3.6), for principal and any premium and interest to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;

 

(2)       the Company has paid or caused to be paid all other sums payable by the Company under this Indenture; and

 

(3)       the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this Indenture relating to the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 6.7, the obligations (if any) of the Company to any Authenticating Agent under Section 6.14 and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (1) of this Section, the obligations of the Trustee under Section 4.2 and the last paragraph of Section 10.3 shall survive.

 

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In the event Securities of two or more series were at any time issued under this Indenture, the Trustee shall be required to execute an instrument acknowledging satisfaction and discharge of this Indenture only if requested to do so with respect to the Securities of all series as to which it is Trustee and if the conditions of satisfaction and discharge of this Indenture contained in this Section 4.1 in respect of such Securities have been satisfied. In the event there are two or more Trustees under this Indenture, the effectiveness of any such instrument shall be conditioned upon receipt of such instruments from all such Trustees.

 

Section 4.2 Application of Trust Money .

 

Subject to the provisions of the last paragraph of Section 10.3, all money deposited with the Trustee pursuant to Section 4.1 shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled to such money, of the principal and any premium and interest for whose payment such money has been deposited with the Trustee.

 

Article V

Remedies

 

Section 5.1 Events of Default.

 

“Event of Default,” wherever used herein with respect to Securities of any series, means any one of the following events, unless in the establishing Board Resolution, supplemental indenture or Officer’s Certificate, it is provided that such series shall not have the benefit of said Event of Default:

 

(1)       failure to pay any interest on the Securities within 30 days after such interest becomes due and payable by the terms of the Securities of such series;

 

(2)       failure to pay principal of (or premium, if any, on) the Securities at maturity, or if applicable, the redemption price, when the same becomes due and payable;

 

(3)        failure to pay any sinking fund installment as and when the same shall become due and payable by the terms of the Securities, and continuance of such default for a period of 30 days;

 

(4)       failure to comply with (or obtain a waiver with respect to) any of the covenants or agreements in the Securities or this Indenture (other than an agreement or covenant that has been expressly included in this Indenture solely for the benefit of another series of Securities) for 90 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company by the Holders of at least 25% in principal amount of all outstanding Securities affected by that failure a written notice specifying such failure and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder;

 

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(5)       the Company or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

 

(a)       commences a voluntary case;

 

(b)       consents to the entry of an order for relief against it in an involuntary case;

 

(c)       consents to the appointment of a Custodian of it or for all or substantially all of its property;

 

(d)       makes a general assignment for the benefit of its creditors; or

 

(e)       generally is unable to pay its debts as the same become due;

 

(6)       a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(a)       is for relief against the Company or any Significant Subsidiary in an involuntary case;

 

(b)       appoints a Custodian of the Company or any Significant Subsidiary or for all or substantially all of its property; or

 

(c)       orders the liquidation of the Company or any Significant Subsidiary; and

 

(d)       the order or decree remains unstayed and in effect for 90 days;

 

(7)       a default or defaults with respect to any issue or issues of other Debt of the Company or any Subsidiary having an outstanding aggregate principal amount of $35 million for all such issues of all such Persons, whether such Debt now exists or shall hereafter be created, which default or defaults shall constitute a failure to pay all or any portion of the principal of such Debt when due and payable or shall have resulted in such Debt becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable and such Debt has not been discharged in full or such acceleration has not been rescinded or annulled (by cure, waiver or otherwise) within 60 days of such acceleration; provided, however, that any secured Debt in excess of the limits set forth above shall be deemed to have been declared due and payable if the lender in respect thereof takes any action to enforce a security interest against, or an assignment of, or to collect on, seize, dispose of or apply any assets of the Company or its Subsidiaries (including lock-box and other similar arrangements) securing such Debt, or to set off against any bank accounts of the Company or its Subsidiaries in excess of $35 million in the aggregate; and

 

(8)       any other Event of Default provided in the supplemental indenture, Officers’ Certificate or Board Resolution under which such series of Securities is issued or in the form of Security for such series.

 

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The term “Bankruptcy Law” means title 11, U.S. Code or any similar Federal or State law for the relief of debtors or any comparable statute applicable to the Company or a Significant Subsidiary. The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

Section 5.2 Acceleration of Maturity; Rescission and Annulment.

 

If an Event of Default with respect to Securities of any series at the time outstanding occurs and is continuing (other than an Event of Default referred to in Section 5.1(5) or (6)) then in every such case the Trustee or the Holders of not less than 25% in principal amount of the outstanding Securities of that series may declare the principal amount (or, if any Securities of that series are Discount Securities, such portion of the principal amount as may be specified in the terms of such Securities) of and accrued and unpaid interest, if any, on all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) and accrued and unpaid interest, if any, shall become immediately due and payable. If an Event of Default specified in Section 5.1(5) or (6) shall occur, the principal amount (or specified amount) of and accrued and unpaid interest, if any, on all outstanding Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

 

At any time after such a declaration of acceleration with respect to any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the outstanding Securities of that series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if (i) the Company has paid or deposited with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of that series and the principal of (and premium, if any, on) any and all Securities of that series that shall have become due otherwise than by acceleration (with interest upon such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, upon overdue installments of interest, at the rate per annum expressed in the Securities of that series to the date of such payment or deposit) and the amount payable to the Trustee pursuant to Section 6.7 and (ii) all Events of Default with respect to Securities of that series, other than the non-payment of the principal and interest, if any, of Securities of that series which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 5.13.

 

No such rescission shall affect any subsequent Default or impair any right consequent thereon.

 

Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee.

 

The Company covenants that if:

 

(1)       default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days;

 

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(2)       default is made in the payment of the principal of (or premium, if any, on) any Security at its Maturity; or

 

(3)       default is made in the making or satisfaction of any sinking fund or analogous obligation when the same becomes due pursuant to the terms of any Security,

 

then the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and any premium and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and premium and on any overdue interest, at the rate or rates prescribed in such Securities, and, in addition, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements, and advances of the Trustee, its

agents, and counsel.

 

If the Company fails to pay such amounts immediately upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree, and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

 

If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other proper remedy.

 

Section 5.4 Trustee May File Proofs of Claim.

 

In case of any judicial proceeding relative to the Company (or any other obligor upon the Securities), its property, or its creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator, or other similar official in any such judicial proceeding is authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.7.

 

No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment, or composition affecting the Securities or the rights of any Holder or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding; provided , however , the Trustee may vote on behalf of the Holders for the election of a trustee in bankruptcy or similar official and may be a member of a creditors, or other similar committee.

 

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Section 5.5 Trustee May Enforce Claims Without Possession of Securities .

 

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production of such Securities in any related proceeding, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents, and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

Section 5.6 Application of Money Collected .

 

Any money collected by the Trustee pursuant to this Article or, after an Event of Default, any money or other property distributable in respect of the Company’s obligations under this Indenture shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or any premium or interest, upon presentation of the Securities and the notation on such Securities of the payment if only partially paid and upon surrender of such Securities if fully paid:

 

FIRST: To the payment of all amounts due the Trustee (including any predecessor trustee) under Section 6.7;

 

SECOND: To the payment of the amounts then due and unpaid for principal of and any premium and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and any premium and interest, respectively; and

 

THIRD: To the Company.

 

Section 5.7 Limitation on Suits .

 

No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy under this Indenture, unless:

 

(1)       such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series;

 

(2)       the Holders of not less than 25% in principal amount of the Outstanding Securities of that series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee under the Indenture;

 

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(3)       such Holder or Holders have offered to the Trustee indemnity reasonably satisfactory to the Trustee against the costs, expenses, and liabilities to be incurred in compliance with such request;

 

(4)       the Trustee for 60 days after its receipt of such notice, request, and offer of indemnity has failed to institute any such proceeding; and

 

(5)       no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities of that series;

 

it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb, or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal and ratable benefit of all of such Holders.

 

Section 5.8 Unconditional Right of Holders to Receive Principal, Premium, and Interest .

 

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and any premium and (subject to Section 3.7) any interest on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption or mandatory repurchase, on the Redemption Date or mandatory repurchase date, as applicable), and to institute suit for the enforcement of any such payment and such rights shall not be impaired without the consent of such Holder.

 

Section 5.9 Restoration of Rights and Remedies .

 

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions under this Indenture and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

Section 5.10 Rights and Remedies Cumulative .

 

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost, or stolen Securities in the last paragraph of Section 3.6, no right or remedy conferred in this Indenture upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given under this Indenture or now or in the future existing at law or in equity or otherwise. The assertion or employment of any right or remedy under this Indenture, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

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Section 5.11 Delay or Omission Not Waiver .

 

No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of or acquiescence in any such Event of Default. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 5.12 Control by Holders .

 

The Holders of a majority in principal amount of the Outstanding Securities of any series shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such series, provided that

 

(1)       such direction shall not be in conflict with any rule of law or with this Indenture,

 

(2)       the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and

 

(3)       the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer or Officers of the Trustee, determine that the proceeding so directed would involve the Trustee in personal liability.

 

Section 5.13 Waiver of Past Defaults .

 

The Holders of not less than a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Securities of such series waive any past default under this Indenture with respect to such series and its consequences, except a default (1) in the payment of the principal of or any premium or interest on any Security of such series, or (2) in respect of a covenant or provision of this Indenture which under Article IX cannot be modified or amended without the consent of the Holder of each Outstanding Security of such affected series.

 

Upon any such waiver, such default shall cease to exist, and any Event of Default arising from such default shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any consequent right.

 

Section 5.14 Undertaking for Costs .

 

All parties to this Indenture agree, and each Holder of any Securities by his acceptance of such Securities shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered, or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorney’s fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 5.14 shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the outstanding Securities of any series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any) or interest on any Securities on or after the Stated Maturity or Maturities expressed in such Securities (or, in the case of redemption or mandatory repurchase, on or after the Redemption Date or mandatory repurchase date, as applicable).

 

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Article VI

The Trustee

 

Section 6.1 Certain Duties and Responsibilities .

 

(a)       Except during the continuance of an Event of Default,

 

(1)       the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

 

(2)       in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts, statements, opinions or conclusions stated therein).

 

(b)       In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

 

(c)       No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that

 

(1)       this Subsection (c) shall not be construed to limit the effect of Subsections (a) or (d) of this Section;

 

(2)       the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and

 

(3)       the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Securities of any series, determined as provided herein, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such series.

 

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(d)       No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(e)       Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 6.1.

 

Section 6.2 Notice of Defaults .

 

Within 90 days after the occurrence of any default hereunder with respect to the Securities of any series, the Trustee shall transmit by first-class mail, postage prepaid, to all Holders of Securities of such series, as their names and addresses appear in the Security Register (or in case that a Depositary (or a nominee thereof) is a Holder of Securities issued in the form of Global Securities, then with respect to such Securities give by electronic, email or other means as such be acceptable to such Depositary), notice of such default hereunder known to the Trustee, unless such default shall have been cured or waived; provided , however , that except in the case of default in the payment of the principal of or the interest on any of the Securities of such series, or in the payment of any sinking fund installment or analogous payment on such series, the Trustee shall be protected in withholding such notice if and so long as the board of directors or trustees or a committee comprised of Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of such series. For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Securities of such series.

 

Section 6.3 Certain Rights of Trustee .

 

Subject to the provisions of Section 6.1:

 

(a)       the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

(b)       any request or direction of the Company mentioned in this Indenture shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;

 

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(c)       whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering, or omitting any action under this Indenture, the Trustee (unless other evidence be specifically prescribed in this Indenture) may, in the absence of bad faith on its part, conclusively rely upon an Officers’ Certificate;

 

(d)       the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered, or omitted by it under this Indenture in good faith and in reliance on such advice or Opinion of Counsel;

 

(e)       the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to the Trustee against the costs, expenses, and liabilities which might be incurred by it in compliance with such request or direction;

 

(f)       the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness, or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records, and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation;

 

(g)       the Trustee may execute any of the trusts or powers or perform any duties under this Indenture either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it;

 

(h)       the Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

 

(i)       the Trustee shall not be charged with knowledge of any default or Event of Default with respect to the Securities unless written notice of such default or Event of Default shall have been given to a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee by the Company or by any Holder of the Securities, and such notice references the Securities and this Indenture;

 

(j)       the permissive rights of the Trustee enumerated herein shall not be construed as duties;

 

(k)       the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder;

 

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(l)       the Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded;

 

(m)       anything in this Indenture notwithstanding, in no event shall the Trustee be liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to loss of profit), even if the Trustee has been advised as to the likelihood of such loss or damage and regardless of the form of action; and

 

(n)       the Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its control, including, without limitation, any provision of any law or regulation or any act of any governmental authority, acts of God; earthquakes; fire; flood; terrorism; wars and other military disturbances; sabotage; epidemics; riots; interruptions; loss or malfunctions of utilities, computer (hardware or software) or communication services; accidents; labor disputes; acts of civil or military authority and governmental action.

 

Section 6.4 Not Responsible for Recitals or Issuance of Securities .

 

The recitals contained in this Indenture and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee or any Authenticating Agent shall not be accountable for the use or application by the Company of Securities or the proceeds from such Securities. The Trustee shall not be responsible to make any calculation with respect to any matter under this Indenture. The Trustee shall have no duty to monitor or investigate the Company’s compliance with or the breach of, or cause to be performed or observed, any representation, warranty, or covenant, or agreement of any Person, other than the Trustee, made in this Indenture.

 

Section 6.5 May Hold Securities .

 

The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar, or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 6.8 and 6.13, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar, or such other agent.

 

Section 6.6 Money Held in Trust .

 

Money held by the Trustee in trust under this Indenture need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it under this Indenture except as otherwise agreed in writing with the Company.

 

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Section 6.7 Compensation and Reimbursement .

 

The Company agrees:

 

(1)       to pay to the Trustee from time to time such compensation as shall be agreed in writing between the Company and the Trustee for all services rendered by it under this Indenture (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

 

(2)       except as otherwise expressly provided in this Indenture, to reimburse the Trustee upon its request for all reasonable expenses, disbursements, and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement, or advance as may be attributable to its gross negligence or willful misconduct; and

 

(3)       to indemnify each of the Trustee and any predecessor Trustee and their officers, agents, directors and employees for, and to hold them harmless against, any and all loss, damage, claim, liability, or expense, including fees and expenses of counsel and including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), incurred without gross negligence or willful misconduct on their part, arising out of or in connection with the acceptance or administration of the trust or trusts under this Indenture, including the costs and expenses of defending itself against any claim (whether asserted by the Company, or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties under this Indenture, or in connection with enforcing the provisions of this Section.

 

To secure the Company’s obligations under this Section, the Trustee shall have a lien prior to the Securities upon all money or property held or collected by the Trustee in its capacity as Trustee, except for such money and property which is held in trust to pay principal (and premium, if any) or interest on particular Securities;

 

In addition to, and without prejudice to its other rights under this Indenture, when the Trustee incurs any expenses or renders any services after the occurrence of an Event of Default specified in Section 5.1(1) or (2), such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under the United States Bankruptcy Code (Title 11 of the United States Code) or any similar Federal or State law for the relief of debtors; and

 

The provisions of this Section 6.7 shall survive the satisfaction and discharge of the Indenture, the resignation or removal of the Trustee and the termination for any reason of this Indenture.

 

“Trustee” for purposes of this Section shall include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder.

 

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Section 6.8 Disqualification; Conflicting Interests .

 

If the Trustee has or shall acquire a conflicting interest within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. For the purpose of the second paragraph of Section 310(b) of the Trust Indenture Act, the phrase “default (as such term is defined in such indenture, but exclusive of any period of grace or requirement of notice)” is hereby defined to mean any event which is, or after notice or lapse of time or both would become, an Event of Default. To the extent permitted by the Trust Indenture Act, the Trustee shall not be deemed to have a conflicting interest by virtue of being a trustee under this Indenture with respect to Securities of more than one series.

 

Section 6.9 Corporate Trustee Required; Eligibility .

 

There shall at all times be a Trustee under this Indenture which shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000. If such Person publishes reports of condition at least annually, pursuant to law or to the requirements of its supervising or examining authority, then for the purposes of this Section (and to the extent permitted by the Trust Indenture Act), the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect specified in this Article.

 

Section 6.10 Resignation and Removal; Appointment of Successor.

 

(a)       No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 6.11.

 

(b)       The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice of such resignation to the Company.

 

(c)       The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company.

 

(d)       If at any time:

 

(1)       the Trustee shall fail to comply with Section 6.8 after written request for such compliance by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or

 

(2)       the Trustee shall cease to be eligible under Section 6.9 and shall fail to resign after written request by the Company or by any such Holder, or

 

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(3)       the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation, or liquidation,

 

then, in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Securities, or (ii) subject to Section 5.14, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment of a successor Trustee or Trustees.

 

(e)       If the instrument of acceptance by a successor Trustee required by Section 6.11 shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation or removal, the Trustee resigning or being removed may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

(f)       If the Trustee shall resign, be removed, or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series) and shall comply with the applicable requirements of Section 6.11. If, within one year after such resignation, removal, or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, immediately upon its acceptance of such appointment in accordance with the applicable requirements of Section 6.11, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 6.11, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

(g)       The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series to all Holders of Securities of such series in the manner provided in Section 1.6. Each notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office.

 

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Section 6.11 Acceptance of Appointment by Successor .

 

(a)       In case of the appointment of a successor Trustee under this Indenture with respect to all Securities, every such successor Trustee so appointed shall execute, acknowledge, and deliver to the Company and to the retiring Trustee an instrument accepting such appointment. Upon such delivery, the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed, or conveyance, shall become vested with all the rights, powers, trusts, and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges and all other amounts payable to it hereunder, execute and deliver an instrument transferring to such successor Trustee all the rights, powers, and trusts of the retiring Trustee and shall duly assign, transfer, and deliver to such successor Trustee all property and money held by such retiring Trustee under this Indenture, subject nevertheless to its lien provided for in Section 6.7.

 

(b)       In case of the appointment under this Indenture of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee, and each successor Trustee with respect to the Securities of one or more series shall execute and deliver a supplemental indenture wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to the Securities of all series, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee, it being understood that nothing in this Indenture or in such supplemental indenture shall constitute such Trustees cotrustees of the same trust and that each such Trustee shall be trustee of a trust or trusts under this Indenture separate and apart from any trust or trusts under this Indenture administered by any other such Trustee; and, upon the execution and delivery of such supplemental indenture, the resignation or removal of the retiring Trustee shall become effective to the extent provided in such supplemental indenture and each such successor Trustee, without any further act, deed, or conveyance, shall become vested with all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; and such retiring Trustee shall duly assign, transfer, and deliver to such successor Trustee all property and money held by such retiring Trustee under this Indenture with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, subject nevertheless to its lien provided for in Section 6.7.

 

(c)       Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers, and trusts referred to in paragraph (a) and (b) of this Section, as the case may be.

 

(d)       No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

 

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Section 6.12 Merger, Conversion, Consolidation, or Succession to Business .

 

Any Person into which the Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion, or consolidation to which the Trustee shall be a party, or any Person succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee under this Indenture, provided such Person shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties to this Indenture. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion, or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

 

Section 6.13 Preferential Collection of Claims Against Company .

 

If and when the Trustee shall be or become a creditor of the Company or any other obligor upon the Securities (other than by reason of a relationship described in Section 311(b) of the Trust Indenture Act), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company or any such other obligor. For purposes of Section 311(b) of the Trust Indenture Act:

 

(A)       the term “cash transaction” means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand; and

 

(B)       the term “self-liquidating paper” means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company or such obligor for the purpose of financing the purchase, processing, manufacturing, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Company or such obligor arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation.

 

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Section 6.14 Appointment of Authenticating Agent .

 

The Trustee may appoint an Authenticating Agent or Agents (which may be an affiliate of the Company) with respect to one or more series of Securities which shall be authorized to act of behalf of the Trustee to authenticate Securities of such series issued upon original issue and upon exchange, registration of transfer, or partial redemption or conversion, or pursuant to Section 3.6, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any of its states, or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by federal or state authority. If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of the supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.

 

Any Person into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion, or consolidation to which such Authenticating Agent shall be a party, or any Person succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such Person shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

 

An Authenticating Agent may resign at any time by giving written notice to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, as their names and addresses appear in the Security Register. Any successor Authenticating Agent upon acceptance of its appointment under this Indenture shall become vested with all the rights, powers, and duties of its predecessor, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

 

The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section.

 

If an appointment with respect to one or more series is made pursuant to this Section, the Securities of such series may have endorsed on it, in addition to the Trustee’s certificate of authentication, an alternative certificate of authentication in the following form:

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

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  THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
     
  By:  
    As Authenticating Agent
  By:  
    Authorized Officer

 

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Article VII

Holder’s Lists and Reports by Trustee and Company

 

Section 7.1 Company to Furnish Trustee Names and Addresses of Holders .

 

The Company will furnish or cause to be furnished to the Trustee:

 

(a)       semi-annually, not later than June 30 and December 31 in each year, a list for each series, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of Securities of such series as of the preceding June 15 or December 15, as the case may be, and

 

(b)       at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; provided , that if and so long as the Trustee shall be the Security Registrar for such series, such lists shall not be required to be furnished.

 

Section 7.2 Preservation of Information; Communications to Holders .

 

(a)       The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in Section 7.1 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar. The Trustee may dispose of as it deems fit any list furnished to it as provided in Section 7.1 upon receipt of a new list so furnished.

 

(b)       The rights of Holders to communicate with other Holders with respect to their rights under this Indenture or under the Securities, and the corresponding rights and privileges of the Trustee, shall be as provided by the Trust Indenture Act.

 

(c)       Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held accountable by reason of any disclosure of information as to names and addresses of Holders made pursuant to the Trust Indenture Act.

 

Section 7.3 Reports by Trustee .

 

(a)       The Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to the Trust Indenture Act. To the extent that any such report is required by the Trust Indenture Act with respect to any 12-month period, such report shall cover the 12-month period ending May 15 and shall be transmitted (in accordance with the Trust Indenture Act) by the next succeeding July 15.

 

(b)       A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which any Securities are listed, with the Commission, and with the Company. The Company will promptly notify the Trustee when any Securities are listed on any stock exchange.

 

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Section 7.4 Reports by Company .

 

The Company shall file with the Trustee and the Commission, and transmit to Holders, such information, documents, and other reports, and such summaries, as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to such Trust Indenture Act; provided that any such information, documents, or reports required to be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within 15 days after the same is so required to be filed with the Commission.

 

Delivery of such reports, information, and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee shall be entitled to rely exclusively on Officers’ Certificates).

 

Article VIII

Consolidation, Merger, Conveyance, Transfer or Lease

 

Section 8.1 Company May Consolidate, Etc., Only on Certain Terms .

 

The Company shall not consolidate with or merge into any other Person or convey, transfer, or lease its properties and assets substantially as an entirety to any Person, and the Company shall not permit any Person to consolidate with or merge into the Company or convey, transfer, or lease its properties and assets substantially as an entirety to the Company, unless:

 

(1)       in case the Company shall consolidate with or merge into another Person or convey, transfer, or lease its properties and assets substantially as an entirety to any Person, the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Company substantially as an entirety shall expressly assume, by a supplemental indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of and any premium and interest on all the Securities and the performance or observance of every covenant of this Indenture on the part of the Company to be performed or observed;

 

(2)       immediately after giving effect to such transaction and treating any indebtedness which becomes an obligation of the Company or a Subsidiary as a result of such transaction as having been incurred by the Company or such Subsidiary at the time of such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing; and

 

(3)       the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer, or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this Article and that all conditions precedent in this Indenture provided for relating to such transaction have been complied with.

 

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Section 8.2 Successor Substituted .

 

Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer, or lease of the properties and assets of the Company substantially as an entirety in accordance with Section 8.1, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer, or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company in this Indenture, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

 

Article IX

Supplemental Indentures

 

Section 9.1 Supplemental Indentures Without Consent of Holders .

 

Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more supplemental indentures, in form satisfactory to the Trustee, for any of the following purposes:

 

(1)       to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company in this Indenture and in the Securities; or

 

(2)       to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power conferred in this Indenture upon the Company; or

 

(3)       to add any additional Events of Default for the benefit of the Holders of all or any series of Securities (and if such additional Events of Default are to be for the benefit of less than all series of Securities, stating that such additional Events of Default are expressly being included solely for the benefit of such series); or

 

(4)       to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or

 

(5)       to add to, change, or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change, or elimination (i) shall neither (A) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (B) modify the rights of the Holder of any such Security with respect to such provision or (ii) shall become effective only when there is no such Security Outstanding; or

 

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(6)       to secure the Securities; or

 

(7)       to establish the form or forms or terms of Securities of any series as permitted by Sections 2.1 and 3.1; or

 

(8)       to evidence and provide for the acceptance of appointment under this Indenture by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee, pursuant to the requirements of Section 6.11(b);

 

(9)       to comply with any requirements of the Commission in connection with qualifying this Indenture under the Trust Indenture Act or conform this Indenture or the Securities of any series to the description thereof contained in any applicable prospectus, prospectus supplement, free writing prospectus, offering memorandum, term sheet or other offering document;

 

(10)       to cure any ambiguity, mistake, defect or inconsistency; or

 

(11)       to make any change, provided that such change shall not adversely affect the interests of the Holders of Securities of any series in any material respect.

 

Section 9.2 Supplemental Indentures With Consent of Holders .

 

With the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of a series, by Act of such Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into a supplemental indenture or indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided , however , that no such supplemental indenture entered into pursuant to this Section 9.2 shall, without the consent of the Holder of each Outstanding Security affected by such supplemental indenture,

 

(1)       change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce its principal amount or rate of interest or any premium payable upon its redemption, or reduce the amount of the principal of an Original Issue Discount Security or any other Security that would be due and payable upon a declaration of acceleration of its Maturity pursuant to Section 5.2, or adversely affect any right of repayment at the option of the Holder of any Security, or change any Place of Payment where any Security or any premium or interest is payable, or impair the right to institute suit for the enforcement of any such payment on or after its Stated Maturity (or, in the case of redemption or mandatory repurchase, on or after the Redemption Date or mandatory repurchase date, as applicable), or

 

(2)       reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with the provisions of or defaults under this Indenture and their consequences provided for in this Indenture, or

 

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(3)       modify any of the provisions of this Section or Section 5.13, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each affected Outstanding Security, provided , however , that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Section 6.11(b) and 9.1(8).

 

A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series.

 

It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance of such supplemental indenture.

 

Section 9.3 Execution of Supplemental Indentures .

 

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications of the trusts created by this Indenture, the Trustee shall be entitled to receive in addition to the documents required by Section 1.2, and (subject to Section 6.1) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise.

 

Section 9.4 Effect of Supplemental Indentures .

 

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance with such supplemental indenture, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities previously or subsequently authenticated and delivered under this Indenture shall be bound by such supplemental indenture.

 

Section 9.5 Conformity With Trust Indenture Act .

 

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act.

 

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Section 9.6 Reference in Securities to Supplemental Indentures .

 

Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Company, bear a notation in form approved by the Company as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series.

 

Section 9.7 Notice of Supplemental Indentures .

 

After any supplemental indenture under this Article becomes effective, the Company may give to the Holders of Securities, in the manner referred to in Section 1.6, a notice briefly describing such supplemental indenture; provided, however, that the failure to give such notice to all Holders of Securities, or any defect therein, shall not impair or affect the validity of such supplemental indenture.

 

Article X

Covenants

 

Section 10.1 Payment of Principal, Premium, and Interest .

 

The Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay the principal of and any premium and interest on the Securities of that series in accordance with the terms of the Securities and this Indenture.

 

Section 10.2 Maintenance of Office or Agency .

 

The Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with its address, such presentations, surrenders, notices, and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company appoints the Trustee as its agent to receive all such presentations, surrenders, notices, and demands.

 

The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided , however , that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

 

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Section 10.3 Money for Securities Payments to Be Held in Trust .

 

If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date of the principal of or any premium or interest on any of the Securities of that series, segregate and hold in trust for the benefit of the Persons entitled to such principal, premium, or interest a sum sufficient to pay the principal and any premium and interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as provided in this Indenture and will promptly notify the Trustee of its action or failure to act.

 

Whenever the Company shall have one or more Paying Agents for any series of Securities, it will, prior to each due date of the principal of or any premium or interest on any Securities of that series, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee in writing of its action or failure to act.

 

The Company will cause each Paying Agent for any series of Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will (i) comply with the provisions of the Trust Indenture Act applicable to it as a Paying Agent and (ii) during the continuance of any default by the Company (or any other obligor upon the Securities of that series) in the making of any payment in respect of the Securities of that series, and upon the written request of the Trustee, immediately pay to the Trustee all sums held in trust by such Paying Agent for payment in respect of the Securities of that series.

 

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Subject to applicable abandoned property laws, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or any premium or interest on any Security of any series and remaining unclaimed for two years after such principal, premium, or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee, shall cease at such time.

 

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Section 10.4 Statement by Officers as to Default .

 

The Company will deliver to the Trustee, within 120 days after the end of each fiscal year of the Company ending after the date of this Indenture, an Officers’ Certificate (one of the signers of which shall be the principal executive officer, principal financial officer, or principal accounting officer of the Company), stating whether or not, to the best knowledge of the signers, the Company is in default in the performance and observance of any of the terms, provisions, and conditions of this Indenture (without regard to any period of grace or requirement of notice provided under this Indenture) and, if the Company shall be in default, specifying all such defaults and their nature and status of which they may have knowledge. The Company will deliver to the Trustee written notice of the occurrence of any Event of Default or default (which word has the meaning of the word “default” as used in Section 6.2), within ten (10) Business Days of the Company becoming aware of any such Event of Default or default and setting forth the detail of such Event of Default or default and the action the Company proposes to take with respect thereto.

 

Section 10.5 Existence .

 

Subject to Article VIII, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its existence, rights (charter and statutory), and franchises; provided , however , that the Company shall not be required to preserve any such right or franchise if the Board of Directors shall determine that its preservation is no longer desirable in the conduct of the business of the Company and that its loss is not disadvantageous in any material respect to the Holders.

 

Article XI

Redemption of Securities

 

Section 11.1 Applicability of Article .

 

Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 3.1 for Securities of any series) in accordance with this Article.

 

Section 11.2 Election to Redeem; Notice to Trustee .

 

The election of the Company to redeem any Securities shall be evidenced by a Board Resolution or in another manner specified as contemplated by Section 3.1 for such Securities. In case of any redemption at the election of the Company, the Company shall, at least 60 calendar days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the principal amount of Securities of such series to be redeemed and, if applicable, of the tenor of the Securities to be redeemed. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers’ Certificate evidencing compliance with such restriction.

 

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Section 11.3 Selection by Trustee of Securities to Be Redeemed .

 

If less than all the Securities of any series are to be redeemed (unless all of the Securities of such series and of a specified tenor are to be redeemed or such series is comprised of a single Security), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption (i) in the case of Global Securities, (a) by lot or such other similar method in accordance with applicable procedures of the Depositary or (b) if there are no such requirements of the Depositary, on a pro rata basis and in compliance with any applicable securities exchange rules or (ii) by such method as the Trustee shall deem fair and appropriate (which may include pro rata or by lot) and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple of such denomination) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series. If less than all of the Securities of such series and of a specified tenor are to be redeemed (unless such series is comprised of a single Security), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series and specified tenor not previously called for redemption in accordance with the preceding sentence.

 

Unless all of the Securities of such series and of a specified tenor are to be redeemed or such series is comprised of a single Security, the Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Securities (other than Securities comprised of a single Security) selected for partial redemption, the principal amount thereof to be redeemed. In the case of any such redemption in part, the unredeemed portion of the principal amount of the Security shall be in an authorized denomination (which shall not be less than the minimum authorized denomination) of such Security.

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed.

 

Section 11.4 Notice of Redemption .

 

Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed, at his address appearing in the Security Register.

 

All notices of redemption shall state:

 

(1)       the Redemption Date,

 

(2)       the Redemption Price (or, if not determinable, the methodology for determining the Redemption Price) and accrued interest, if any,

 

(3)       if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption of any Securities, the principal amounts) of the particular Securities to be redeemed, and that on or after the date fixed for redemption, upon surrender of such Security, a new Security or Securities of such series in authorized denominations for an aggregate principal amount equal to the unredeemed portion will be issued,

 

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(4)       that on the Redemption Date the Redemption Price and accrued interest, if any, will become due and payable upon each such Security to be redeemed and that interest on such Security will cease to accrue on and after such date,

 

(5)       the place or places where such Securities are to be surrendered for payment of the Redemption Price and accrued interest, if any,

 

(6)       that the redemption is for a sinking fund, if such is the case, and

 

(7)       the CUSIP numbers”, “ISIN” or other similar numbers, if any, of the Securities to be redeemed.

Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company’s request (delivered to the Trustee, together with a form of notice of redemption, at least 45 days (unless a shorter period shall be acceptable to the Trustee) prior to the Redemption Date) , by the Trustee in the name and at the expense of the Company and shall be irrevocable.

 

Section 11.5 Deposit of Redemption Price .

 

Prior to 10:00 a.m., New York City time on the Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 10.3) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date.

 

Section 11.6 Securities Payable on Redemption Date .

 

Notice of redemption having been given in accordance with this Indenture, the Securities to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price specified in the notice, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with such notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided , however , that, unless otherwise specified as contemplated by Section 3.1, installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 3.7.

 

If any Security called for redemption shall not be so paid upon surrender for redemption, the principal and any premium shall, until paid, bear interest from the Redemption Date at the rate prescribed in the Security.

 

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Section 11.7 Securities Redeemed in Part .

 

Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series and of like tenor, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

 

Article XII

Sinking Funds

 

Section 12.1 Applicability of Article .

 

The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 3.1 for Securities of such series.

 

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is referred to in this Indenture as a “mandatory sinking fund payment”, and any payment in excess of such minimum amount provided for by the terms of Securities of any series is referred to in this Indenture as an “optional sinking fund payment”. If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 12.2. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.

 

Section 12.2 Satisfaction of Sinking Fund Payments with Securities .

 

The Company (1) may deliver Securities of a series (other than any previously called for redemption) and (2) may apply as a credit Securities of a series which previously have been redeemed by the Company either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, or have been otherwise acquired by the Company as permitted by such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.

 

Section 12.3 Redemption of Securities for Sinking Fund .

 

Not less than 90 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion, if any, which is to be satisfied by payment of cash and the portion, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant to Section 12.2 and the basis for such credit and will also deliver to the Trustee any Securities to be so delivered. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 11.3 and cause notice of redemption to be given in the name of and at the expense of the Company in the manner provided in Section 11.4. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 11.6 and 11.7.

 

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Article XIII

Defeasance and Covenant Defeasance

 

Section 13.1 Applicability of Article; Company’s Option to Effect Defeasance or Covenant Defeasance .

 

If, pursuant to Section 3.1, provision is made for either or both of (a) Defeasance of the Securities of a series under Section 13.2 or (b) Covenant Defeasance of the Securities of a series under Section 13.3, then the provisions of such Section or Sections, as the case may be, together with the other provisions of this Article XIII, shall be applicable to the Securities of such series, and the Company may at its option by Board Resolution or in any other manner specified as contemplated by Section 3.1, at any time, with respect to the Securities of such series, elect to have either Section 13.2 (if applicable) or Section 13.3 (if applicable) be applied to the Outstanding Securities of such series upon compliance with the conditions set forth below in this Article XIII.

 

Section 13.2 Defeasance and Discharge .

 

Upon the Company’s exercise of the above option applicable to this Section, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series on and after the date the conditions precedent set forth in Section 13.3 are satisfied (“Defeasance”). For this purpose, such Defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the Outstanding Securities of such series and to have satisfied all its other obligations under such Securities and this Indenture, insofar as such Securities are concerned (and the Trustee, upon Company Order and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged under this Indenture: (A) the rights of Holders of Outstanding Securities of such series to receive, solely from the trust fund described in Section 13.4 as more fully set forth in such Section, payments of the principal of (any premium, if any) and interest on such Securities when such payments are due, (B) the Company’s obligations with respect to such Securities under Sections 3.4, 3.5, 3.6, 6.7, 10.2, and 10.3, and any ancillary obligations, (C) the rights, powers, trusts, duties, immunities, and other provisions in respect of the Trustee under this Indenture, and (D) this Article XIII. Subject to compliance with this Article XIII, the Company may exercise its option under this Section 13.2 notwithstanding the prior exercise of its option under Section 13.3 with respect to the Securities of such series. Following a Defeasance, payment of the Securities of such series may not be accelerated because of an Event of Default.

 

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Section 13.3 Covenant Defeasance .

 

Upon the Company’s exercise of the above option applicable to this Section and after the date the conditions set forth below are satisfied (“Covenant Defeasance”), (1) the Company shall be released from its obligations under any covenant applicable to such Securities that is determined pursuant to Section 3.1 to be subject to this provision, and (2) the occurrence of any event specified in Section 5.1(5) or 5.1(6) solely with respect to Significant Subsidiaries, Section 5.1(7) or determined pursuant to Section 3.1 to be subject to this provision shall not be deemed to be or result in an Event of Default. For this purpose, such Covenant Defeasance means that, with respect to the Outstanding Securities of such series, the Company may omit to comply with and shall have no liability in respect of any term, condition, or limitation set forth in any such Section whether directly or indirectly by reason of any reference elsewhere in this Indenture to any such Section or by reason of any reference in any such Section to any other provision in this Indenture or in any other document, but the remainder of this Indenture and such Securities shall be unaffected by such Covenant Defeasance.

 

Section 13.4 Conditions to Defeasance or Covenant Defeasance .

 

The following shall be the conditions precedent to application of either Section 13.2 or Section 13.3 to the Outstanding Securities of such series:

 

(1)       The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee which satisfies the requirements contemplated by Section 6.9 and agrees to comply with the provisions of the Indenture applicable to it as if it were the Trustee under this Indenture), as trust funds in trust for the purpose of making the following payments, and dedicated solely to, the benefit of the Holders of such Securities, (A) money in an amount, or (B) U.S. Government Obligations which through the scheduled payment of principal and interest in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination of such money and U.S. Government Obligations, in each case sufficient, without reinvestment, in the opinion of a nationally recognized firm of independent public accountants or investment bankers expressed in a written certification delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee as previously provided) to pay and discharge, the principal of (and premium, if any) and interest on the Outstanding Securities of such series on the Maturity of such principal, any premium or interest, and any mandatory sinking fund payments or analogous payments applicable to the Outstanding Securities of such series on their due dates. Before such a deposit, the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date or dates in accordance with Article XI, which shall be given effect in applying the foregoing provisions. For this purpose, “U.S. Government Obligations” means securities that are (x) direct obligations of the United States of America for the payment of which its full faith and credit is pledged, or (y) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended), which may include the Trustee, as custodian with respect to any such U.S. Government Obligation or a specific payment of principal of or interest on any such U.S. Government Obligation held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal of or interest on the U.S. Government Obligation evidenced by such depository receipt.

 

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(2)       No Event of Default or event which with notice or lapse of time or both would become an Event of Default with respect to the Securities of such series shall have occurred and be continuing (A) on the date of such deposit or (B) insofar as subsections 5.1(1) and (2) are concerned, at any time during the period ending on the 120th day after the date of such deposit or, if longer, ending on the day following the expiration of the preference period applicable to the Company under federal law in respect of such deposit (it being understood that the condition in this clause (B) shall not be deemed satisfied until the expiration of such period).

 

(3)       Such Defeasance or Covenant Defeasance shall not (A) cause the Trustee in respect of the Securities of such series to have a conflicting interest as defined in Section 6.8 or for purposes of the Trust Indenture Act with respect to any Securities of the Company or (B) result in the trust arising from such deposit to constitute, unless it is qualified as, a regulated investment company under the Investment Company Act of 1940, as amended.

 

(4)       Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or by which it is bound.

 

(5)       Such Defeasance or Covenant Defeasance shall not cause any Securities of such series then listed on any registered national securities exchange under the Securities Exchange Act of 1934, as amended, to be delisted.

 

(6)       In the case of an election under Section 13.2, the Company shall have delivered to the Trustee an Opinion of Counsel stating that (x) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (y) since the date of this Indenture there has been a change in the applicable federal income tax law, in either case to the effect that, and based on such ruling or change such opinion shall confirm that, the Holders of the Outstanding Securities of such series will not recognize income, gain, or loss for federal income tax purposes as a result of such Defeasance and will be subject to federal income tax on the same amounts, in the same manner, and at the same times as would have been the case if such Defeasance had not occurred.

 

(7)       In the case of an election under Section 13.3, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize income, gain, or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner, and at the same times as would have been the case if such Covenant Defeasance had not occurred.

 

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(8)       The Company shall have delivered to the Trustee an Opinion of Counsel to the effect that (subject to customary qualifications and assumptions) after the period described in Section 13.4(2), the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization, or similar laws affecting creditors’ rights generally.

 

(9)       Such Defeasance or Covenant Defeasance shall be effected in compliance with any additional terms, conditions, or limitations which may be imposed on the Company in connection with such Defeasance or Covenant Defeasance pursuant to Section 3.1.

 

(10)       The Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this Indenture relating to either the Defeasance under Section 13.2 or the Covenant Defeasance under Section 13.3 (as the case may be) have been complied with.

 

Section 13.5 Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions .

 

Subject to the provisions of the last paragraph of Section 10.3, all money and U.S. Government Obligations (including any proceeds) deposited with the Trustee or other qualifying trustee (solely for purposes of this Section and Section 13.6, the Trustee and any such other qualifying trustee are referred to collectively as the “Trustee”) pursuant to Section 13.4 in respect of the Outstanding Securities of such series shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any Paying Agent (but not including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of such Securities, of all sums due and to become due on such Securities in respect of principal (and premium, if any) and interest, but such money need not be segregated from other funds except to the extent required by law.

 

The Company shall pay and indemnify the Trustee against any tax, fee, or other charge imposed on or assessed against the money or U.S. Government Obligations deposited pursuant to Section 13.4 or the principal and interest received in respect of such money or U.S. Government Obligations other than any such tax, fee, or other charge which by law is for the account of the Holders of Outstanding Securities.

 

Anything in this Indenture to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or U.S. Government Obligations held by it as provided in Section 13.4 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification delivered to the Trustee, are in excess of the amount which would then be required to be deposited to effect an equivalent Defeasance or Covenant Defeasance.

 

Section 13.6 Reinstatement .

 

If the Trustee or the Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 13.5 by reason of any order or judgment of any court or governmental authority enjoining, restraining, or otherwise prohibiting such application, then the Company’s obligations under the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this Article XIII until such time as the Trustee or Paying Agent is permitted to apply all such money and U.S. Government Obligations in accordance with Section 13.5; provided , however , that if the Company makes any payment of principal of (and premium, if any) or interest on any such Security following the reinstatement of its obligations, the Company shall be entitled, at its election, (a) to receive from the Trustee or Paying Agent, as applicable, that portion of such money or U.S. Government Obligations held by the Trustee or the Paying Agent, as applicable, equal to the amount of such payment, or (b) to be subrogated to the rights of the Holders of such Securities to receive such payment from the money and U.S. Government Obligations held by the Trustee or the Paying Agent.

 

  57  

 

 

This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. The exchange of copies of this Indenture and of signature pages by facsimile or electronic format ( i.e. , “pdf” or “tif”) transmission shall constitute effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronic format ( i.e. , “pdf” or “tif”) shall be deemed to be their original signatures for all purposes.

 

IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the day and year first above written.

 

  INTERNATIONAL SEAWAYS, INC.

  

  By:  
  Name:  
  Title:  

 

 

THE BANK OF NEW YORK MELLON TRUST

COMPANY, N.A., as Trustee

 

     
  By:  
  Name:  
  Title:  

 

  58  

 

 

Exhibit 4.3

 

INTERNATIONAL SEAWAYS, INC.

 

and

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

 

as Trustee

 

INDENTURE

 

Dated as of [                     ,            ]

 

SUBORDINATED DEBT SECURITIES

 

 

 

 

Table of Contents

 

    Page
     
Article I Definitions And Other Provisions of General Application 1
     
Section 1.1 Definitions. 1
Section 1.2 Compliance Certificates and Opinions. 9
Section 1.3 Form of Documents Delivered to Trustee. 9
Section 1.4 Acts of Holders; Record Dates. 10
Section 1.5 Notices, Etc. to Trustee and Company. 11
Section 1.6 Notice to Holders; Waiver. 12
Section 1.7 Conflict with Trust Indenture Act. 12
Section 1.8 Effect of Headings and Table of Contents. 12
Section 1.9 Successors and Assigns. 12
Section 1.10 Separability Clause. 12
Section 1.11 Benefits of Indenture. 12
Section 1.12 Governing Law; Waiver of Jury Trial; Consent to Jurisdiction. 13
Section 1.13 Legal Holidays. 13
     
Article II Security Forms 14
     
Section 2.1 Forms Generally. 14
Section 2.2 Form of Legend for Global Securities. 14
Section 2.3 Form of Trustee’s Certificate of Authentication. 14
     
Article III The Securities 15
     
Section 3.1 Amount Unlimited; Issuable in Series. 15
Section 3.2 Denominations. 17
Section 3.3 Execution, Authentication, Delivery and Dating. 17
Section 3.4 Temporary Securities. 19
Section 3.5 Registration, Registration of Transfer and Exchange. 20
Section 3.6 Mutilated, Destroyed, Lost, and Stolen Securities. 22
Section 3.7 Payment of Interest; Interest Rights Preserved. 22
Section 3.8 Persons Deemed Owners. 23
Section 3.9 Cancellation. 24
Section 3.10 Computation of Interest. 24
Section 3.11 CUSIP Numbers. 25
     
Article IV Satisfaction and Discharge 25
     
Section 4.1 Satisfaction and Discharge of Indenture. 25
Section 4.2 Application of Trust Money. 26
     
Article V Remedies 26
     
Section 5.1 Events of Default. 26
Section 5.2 Acceleration of Maturity; Rescission and Annulment. 28

 

  -i-

 

 

Table of Contents  

(continued)

 

    Page
     
Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee. 29
Section 5.4 Trustee May File Proofs of Claim. 30
Section 5.5 Trustee May Enforce Claims Without Possession of Securities. 30
Section 5.6 Application of Money Collected. 30
Section 5.7 Limitation on Suits. 31
Section 5.8 Unconditional Right of Holders to Receive Principal, Premium, and Interest. 31
Section 5.9 Restoration of Rights and Remedies. 31
Section 5.10 Rights and Remedies Cumulative. 32
Section 5.11 Delay or Omission Not Waiver. 32
Section 5.12 Control by Holders. 32
Section 5.13 Waiver of Past Defaults. 32
Section 5.14 Undertaking for Costs. 33
     
Article VI The Trustee 33
     
Section 6.1 Certain Duties and Responsibilities. 33
Section 6.2 Notice of Defaults. 34
Section 6.3 Certain Rights of Trustee. 35
Section 6.4 Not Responsible for Recitals or Issuance of Securities. 36
Section 6.5 May Hold Securities. 37
Section 6.6 Money Held in Trust. 37
Section 6.7 Compensation and Reimbursement. 37
Section 6.8 Disqualification; Conflicting Interests. 38
Section 6.9 Corporate Trustee Required; Eligibility. 38
Section 6.10 Resignation and Removal; Appointment of Successor. 38
Section 6.11 Acceptance of Appointment by Successor. 40
Section 6.12 Merger, Conversion, Consolidation, or Succession to Business. 41
Section 6.13 Preferential Collection of Claims Against Company. 41
Section 6.14 Appointment of Authenticating Agent. 42
     
Article VII Holder’s Lists and Reports by Trustee and Company 43
     
Section 7.1 Company to Furnish Trustee Names and Addresses of Holders. 43
Section 7.2 Preservation of Information; Communications to Holders. 43
Section 7.3 Reports by Trustee. 44
Section 7.4 Reports by Company. 44
     
Article VIII Consolidation, Merger, Conveyance, Transfer or Lease 44
     
Section 8.1 Company May Consolidate, Etc., Only on Certain Terms. 44
Section 8.2 Successor Substituted. 45

 

- ii-

 

 

Table of Contents  

(continued)

 

  Page
   
Article IX Supplemental Indentures 45
     
Section 9.1 Supplemental Indentures Without Consent of Holders. 45
Section 9.2 Supplemental Indentures With Consent of Holders. 47
Section 9.3 Execution of Supplemental Indentures. 47
Section 9.4 Effect of Supplemental Indentures. 48
Section 9.5 Conformity With Trust Indenture Act. 48
Section 9.6 Reference in Securities to Supplemental Indentures. 48
Section 9.7 Notice of Supplemental Indentures. 48
     
Article X Covenants 48
     
Section 10.1 Payment of Principal, Premium, and Interest. 48
Section 10.2 Maintenance of Office or Agency. 49
Section 10.3 Money for Securities Payments to Be Held in Trust. 49
Section 10.4 Statement by Officers as to Default. 50
Section 10.5 Existence. 50
     
Article XI Redemption of Securities 50
     
Section 11.1 Applicability of Article. 50
Section 11.2 Election to Redeem; Notice to Trustee. 51
Section 11.3 Selection by Trustee of Securities to Be Redeemed. 51
Section 11.4 Notice of Redemption. 52
Section 11.5 Deposit of Redemption Price. 52
Section 11.6 Securities Payable on Redemption Date. 53
Section 11.7 Securities Redeemed in Part. 53
     
Article XII Sinking Funds 53
     
Section 12.1 Applicability of Article. 53
Section 12.2 Satisfaction of Sinking Fund Payments with Securities. 54
Section 12.3 Redemption of Securities for Sinking Fund. 54
     
Article XIII Defeasance and Covenant Defeasance 54
     
Section 13.1 Applicability of Article; Company’s Option to Effect Defeasance or Covenant Defeasance. 54
Section 13.2 Defeasance and Discharge. 55
Section 13.3 Covenant Defeasance. 55
Section 13.4 Conditions to Defeasance or Covenant Defeasance. 55
Section 13.5 Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions. 57
Section 13.6 Reinstatement. 58

 

- iii-

 

 

Table of Contents  

(continued)

 

    Page
     
Article XIV Subordination Of Securities 58
     
Section 14.1 Securities Subordinate to Senior Debt. 58
Section 14.2 No Payment When Senior Debt in Default. 60
Section 14.3 Trustee and Holders of Securities May Rely on Certificate of Liquidating Agent; Trustee May Require Further Evidence as to Ownership of Senior Debt; Trustee Not Fiduciary to Holders of Senior Debt. 61
Section 14.4 Payment Permitted If No Default. 62
Section 14.5 Trustee Not Charged with Knowledge of Prohibition. 62
Section 14.6 Trustee to Effectuate Subordination. 63
Section 14.7 Rights of Trustee as Holder of Senior Debt. 63
Section 14.8 Article Applicable to Paying Agents. 63
Section 14.9 Subordination Rights Not Impaired by Acts or Omissions of the Company or Holders of Senior Debt. 63
Section 14.10 Trustee’s Rights to Compensation, Reimbursement of Expenses and Indemnification. 64
Section 14.11 Modification of Subordination Provisions. 64

 

NOTE: This table of contents shall not, for any purpose, be deemed to be part of the Indenture.

 

 - iv -

 

 

INTERNATIONAL SEAWAYS, INC.

 

Certain Sections of this Indenture relating to
Sections 310 through 318, inclusive, of the
Trust Indenture Act of 1939:

 

Trust Indenture

 

Act Section

 

Indenture Section

§310   (a)(1)   6.9
    (a)(2)   6.9
    (a)(3)   Not Applicable
    (a)(4)   Not Applicable
    (b)   6.8
        6.10
§311   (a)   6.13
    (b)   6.13
§312   (a)   7.1
    (b)   7.2(a)
    (c)   7.2(b)
§313   (a)   7.3(a)
    (b)   7.3(a)
    (c)   7.3(a)
    (d)   7.3(b)
§314   (a)   7.4
    (a)(4)   1.2
        10.4
    (b)   Not Applicable
    (c)(1)   1.2
    (c)(2)   1.2
    (c)(3)   Not Applicable
    (d)   Not Applicable
    (e)   1.2
§315   (a)   6.1
    (b)   6.2
    (c)   6.1
    (d)   6.1
    (d)(1)   6.1
    (d)(2)   6.1
    (d)(3)   6.1
    (e)   5.14
§316   (a)(1)(A)   5.12
    (a)(1)(B)   5.2
        5.13
    (a)(2)   Not Applicable
    (b)   5.8
    (c)   1.4(c)
§317   (a)(1)   5.3
    (a)(2)   5.4
    (b)   10.3
§318   (a)   1.7

 

NOTE: This shall not, for any purpose, be deemed to be part of the Indenture.

 

 - v-

 

 

INDENTURE , dated as of [                  ,                  ], between INTERNATIONAL SEAWAYS, INC., a corporation duly organized and existing under the laws of the Marshall Islands (the “Company”), having its principal office at 600 Third Avenue, 39th Floor, New York, New York, and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as Trustee (the “Trustee”).

 

RECITALS OF THE COMPANY

 

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its subordinated, unsecured debentures, notes, or other evidences of indebtedness (the “Securities”), to be issued in one or more series as provided in this Indenture.

 

All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Securities by the Holders, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Securities or of any series of the Securities, as follows:

 

Article I

Definitions And Other Provisions of General Application

 

Section 1.1 Definitions.

 

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

 

(1)       the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

 

(2)       all other terms used in this Indenture which are defined in the Trust Indenture Act, either directly or by reference to the Trust Indenture Act, have the meanings assigned to them in the Trust Indenture Act;

 

(3)       all accounting terms not otherwise defined in this Indenture have the meanings assigned to them in accordance with accounting principles generally accepted in the United States and, except as otherwise expressly provided in this Indenture, the term “accounting principles generally accepted in the United States” with respect to any computation required or permitted under this Indenture shall mean such accounting principles as are generally accepted in the United States at the date hereof;

 

(4)       the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision; and

 

  1  

 

 

(5)       unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or a Section, as the case may be, of this Indenture.

 

“Act”, when used with respect to any Holder, has the meaning specified in Section 1.4(a).

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract, or otherwise; and the terms “controlling” and “controlled” have the meanings correlative to the foregoing.

 

“Authenticating Agent” means any Person authorized by the Trustee pursuant to Section 6.14 to act on behalf of the Trustee to authenticate Securities of one or more series.

 

“Authorized Officer” means any officer of the Company designated by or pursuant to a Board Resolution to take certain actions as specified in this Indenture.

 

“Board of Directors” means either the board of directors of the Company or any other duly authorized committee of that board.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors, or by action of an Authorized Officer designated as such pursuant to a resolution of the Board of Directors, and to be in full force and effect on the date of such certification, and delivered to the Trustee.

 

“Business Day” means, unless otherwise specified, any day that is not a Saturday or Sunday and that is not a day on which banking institutions are authorized or required by law, regulation or executive order to be closed in The City of New York, New York or a day on which the Corporate Trust Office is closed.

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Company” means the Person named as the “Company” in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

 

“Company Request” or “Company Order” means a written request or order signed in the name of the Company by its Chairman, its Chief Executive Officer, its President, its Chief Financial Officer, or a Vice President, and by its Treasurer, an Assistant Treasurer, its Controller, an Assistant Controller, its Secretary, or an Assistant Secretary, and delivered to the Trustee.

 

  2  

 

 

“Corporate Trust Office” means the office of the Trustee at which any particular time its corporate trust business in Pittsburgh, Pennsylvania shall be principally administered, which office as of the date of this instrument is located at 525 William Penn Place, 38 th Floor, Pittsburgh, Pennsylvania 15259, except that with respect to presentation of Securities for payment or for registration of transfer or exchange, such term shall mean the office or agency of the Trustee at which at any particular time its corporate agency business shall be conducted, which office at the date of this instrument is located at 101 Barclay Street, New York, New York 10286; Attention: Corporate Trust Division—Corporate Finance Unit, or, in the case of any of such offices or agency, such other address as the Trustee may designate from time to time by notice to the Company.

 

“Covenant Defeasance” has the meaning specified in Section 13.3.

 

“Debt” means, with respect to any Person at any date of determination (without duplication):

 

(i) all debt of such Person for borrowed money,

 

(ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments,

 

(iii) all obligations of such Person in respect of letters of credit or other similar instruments (including reimbursement obligations with respect thereto),

 

(iv) all obligations of such Person to pay the deferred purchase price of property or services, which purchase price is due more than six months after the date of placing such property in service or taking delivery thereto or the completion of such services, except trade payables,

 

(v) all obligations of such Person as lessee under Capitalized Leases,

 

(vi) Debt of Persons other than such Person secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such Person; provided that the amount of such Debt shall be the lesser of (A) the fair market value of such asset at such date of determination and (B) the amount of such Debt, and

 

(vii) all Debt of Persons other than such Person guaranteed by such Person to the extent such Debt is guaranteed by such Person.

 

“Defaulted Interest” has the meaning specified in Section 3.7.

 

“Defeasance” has the meaning specified in Section 13.2.

 

“Depositary” means, with respect to the Securities of any series issuable or issued in whole or in part in the form of one or more Global Securities, the Person designated as Depositary for such series by the Company pursuant to Section 3.1, which Person shall be a clearing agency registered under the Exchange Act.

 

“Event of Default” has the meaning specified in Section 5.1.

 

  3  

 

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended now or in the future, and any successor statute.

 

“Global Security” means a Security bearing the legend prescribed in Section 2.2 evidencing all or part of a series of Securities, authenticated and delivered to the Depositary for such series or its nominee, and registered in the name of such Depositary or nominee.

 

“Holder” means a Person in whose name a Security is registered in the Security Register.

 

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more supplemental indentures entered into pursuant to the applicable provisions of this Indenture, including, for all purposes of this Indenture and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this Indenture and any such supplemental indenture, respectively. The term “Indenture” shall also include the terms of particular series of Securities established as contemplated by Section 3.1.

 

“Interest Payment Date”, with respect to any Security, means the Stated Maturity of an installment of interest on such Security.

 

“Lien” means, any mortgage, lien, pledge, security interest, encumbrance or charge of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof, any sale with recourse against the seller or any Affiliate of the seller, or any agreement to give any security interest).

 

“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable in accordance with its terms or the terms of this Indenture, whether at the Stated Maturity or by declaration of acceleration, call for redemption, or otherwise.

 

“Officers’ Certificate” means a certificate signed by the Chairman, the Chief Executive Officer, the President, the Chief Financial Officer, or a Vice President, and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary, or an Assistant Secretary, of the Company, and delivered to the Trustee. One of the officers signing an Officers’ Certificate given pursuant to Section 10.4 shall be the principal executive, financial, or accounting officer of the Company.

 

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for the Company, and who, in all cases, shall be reasonably acceptable to the Trustee.

 

“Original Issue Discount Security” means any Security which provides for an amount less than the principal amount of such Security to be due and payable upon a declaration of acceleration of the Maturity of such Security pursuant to Section 5.2.

 

“Outstanding”, when used with respect to Securities, means, as of the date of determination, all Securities previously authenticated and delivered under this Indenture, except :

 

  4  

 

 

(i) Securities previously cancelled by the Trustee or delivered to the Trustee for cancellation;

 

(ii) Securities for whose payment or redemption money in the necessary amount has been previously deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision for such redemption satisfactory to the Trustee has been made;

 

(iii) Securities which have been paid pursuant to Section 3.6 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a protected purchaser in whose hands such Securities are valid obligations of the Company;

 

(iv) Securities which have been defeased pursuant to Section 13.2; and

 

(v) Securities not deemed outstanding pursuant to Section 11.3;

 

provided , however , that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent, or waiver under this Indenture, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding shall be the amount of the principal that would be due and payable as of the date of such determination upon acceleration of its maturity pursuant to Section 5.2, (ii) if, as of such date, the principal amount payable at the Stated Maturity of a Security is not determinable, the principal amount of such Security which shall be deemed to be Outstanding shall be the amount as specified or determined as contemplated by Section 3.1, and (iii) Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or any such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, or waiver, only Securities which a Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or any such other obligor.

 

“Paying Agent” means any Person authorized by the Company to pay the principal of or any premium or interest on any Securities on behalf of the Company.

 

“Periodic Offering” means an offering of Securities of any series from time to time, the specific terms of which Securities, including, without limitation, its rate or rates of interest, if any, its Stated Maturity, and redemption provisions, if any, with respect to such Securities are to be determined by the Company or its agents upon the issuance of such Securities.

 

  5  

 

 

“Person” means any individual, corporation, limited liability company, partnership, joint venture, trust, association, unincorporated organization, or government or any agency or political subdivision of any government.

 

“Place of Payment”, when used with respect to the Securities of any series, means the place or places where the principal of and any premium and interest on the Securities of that series are payable as specified as contemplated by Section 3.1.

 

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 3.6 in exchange for or in lieu of a mutilated, destroyed, lost, or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost, or stolen Security.

 

“Ranking junior to the Securities”, when used with respect to any obligation of the Company, shall mean any obligation of the Company which (a) ranks junior to and not equally with or prior to the Securities (or any other obligations of the Company ranking on a parity with the Securities) in right of payment upon the happening of any event of the kind specified in the first sentence of the second paragraph in Section 14.1 or (b) is specifically designated as ranking junior to the Securities by express provision in the instrument creating or evidencing such obligation. The securing of any obligations of the Company, otherwise ranking junior to the Securities, shall be deemed to prevent such obligations from constituting obligations ranking junior to the Securities. For the avoidance of doubt, any junior subordinated debt securities issued or assumed by the Company shall be deemed securities ranking junior to the Securities other than any such securities issued after the date hereof that by their terms expressly rank on a parity with the Securities.

 

“ranking on a parity with the Securities”, when used with respect to any obligation of the Company, shall mean any obligation of the Company which (a) ranks equally with and not prior to the Securities in right of payment upon the happening of any event of the kind specified in the first sentence of the second paragraph of Section 14.1 or (b) is specifically designated as ranking on a parity with the Securities by express provision in the instrument creating or evidencing such obligation. The securing of any obligations of the Company, otherwise ranking on a parity with the Securities, shall not be deemed to prevent such obligations from constituting obligations ranking on a parity with the Securities.

 

“Redemption Date”, when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

 

“Redemption Price”, when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

 

“Regular Record Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by Section 3.1.

 

“Responsible Officer”, when used with respect to the Trustee, means any officer assigned to the Corporate Trust Division—Corporate Finance Unit (or any successor division or unit) of the Trustee located at the Corporate Trust Office of the Trustee, who shall have direct responsibility for the administration of this Indenture, and for the purposes of Sections, 5.12(3), 6.1(c)(2) and 6.2 shall also include any other officer of the Trustee to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

 

  6  

 

 

“Securities” has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.

 

“Security Register” and “Security Registrar” have the respective meanings specified in Section 3.5.

 

“Senior Debt” means

 

(i) the principal of (and premium, if any) and interest due on indebtedness of the Company for borrowed money;

 

(ii) all obligations guaranteed by the Company for the repayment of borrowed money, whether or not evidenced by bonds, debentures, notes or other written instruments;

 

(iii) all obligations guaranteed by the Company evidenced by bonds, debentures, notes or similar written instruments, including obligations assumed or incurred in connection with the acquisition of property, assets or businesses (provided, however, that the deferred purchase price of any other business or property or assets shall not be considered indebtedness if the purchase price thereof is payable in full within 90 days from the date on which such indebtedness was created);

 

(iv) any obligations of the Company as lessee under leases required to be capitalized on the balance sheet of the lessee under generally accepted accounting principles;

 

(v) all obligations of the Company for the reimbursement on any letter of credit, banker’s acceptance, security purchase facility or similar credit transaction;

 

(vi) all obligations of the Company in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts and other similar agreements;

 

(vii) all obligations of the types referred to above of other persons for the payment of which the Company is responsible or liable as obligor, guarantor or otherwise; and

 

(viii) all obligations of the types referred to above of other persons secured by any lien on any property or asset of the Company (whether or not such obligation is assumed by the Company),

 

  7  

 

 

in each case whether outstanding on the date of execution of this Indenture or incurred later, other than obligations ranking on a parity with the Securities or ranking junior to the Securities. Notwithstanding the foregoing, the “Senior Debt Securities” does not include indebtedness or monetary obligations to trade creditors created or assumed by the Company in the ordinary course of business in connection with the obtaining of materials or services and any indebtedness of the Company to its affiliates (including all debt securities and guarantees in respect of those debt securities issued to any trust, partnership or other entity affiliated with the Company that is a financing vehicle of the Company in connection with the issuance by such financing entity of preferred securities or other securities guaranteed by the Company) unless otherwise expressly provided in the terms of any such indebtedness.

 

“Significant Subsidiary” means the “significant subsidiaries” or any “significant subsidiary” of the Company, as defined in Rule 1-02(w) of Regulation S-X under the Securities Act.

 

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 3.7.

 

“Stated Maturity”, when used with respect to any Security or any installment of principal or interest on such Security, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.

 

“Subsidiary” means a corporation or other Person more than 50% of the outstanding voting stock or a majority of the controlling interest of which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the purposes of this definition, “voting stock” means stock which ordinarily has voting power for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by reason of any contingency.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee under this Indenture, and if at any time there is more than one such Person, “Trustee”, as used with respect to the Securities of any series, shall mean the Trustee with respect to Securities of that series.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as in force at the date as of which this Indenture was executed; provided , however , that in the event the Trust Indenture Act of 1939 is amended after such date, “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939, as so amended.

 

“U.S. Government Obligation” has the meaning specified in Section 13.4.

 

“Vice President”, when used with respect to the Company or the Trustee, means any vice president (other than any assistant vice president), whether or not designated by a number or a word or words added before or after the title “vice president”.

 

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Section 1.2 Compliance Certificates and Opinions.

 

Upon any application to or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except in the case of any such application or request as to which the furnishing of such documents is specifically required by any provisions of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

 

Every certificate or opinion (other than the Officers’ Certificate delivered under Section 10.4 of this Indenture) with respect to compliance with a condition or covenant provided for in this Indenture shall include:

 

(1)       a statement that each individual signing such certificate or opinion has read such covenant or condition and the related definitions;

 

(2)       a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(3)       a statement that, in the opinion of each such individual, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)       a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

 

Section 1.3 Form of Documents Delivered to Trustee.

 

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

 

Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which this certificate or opinion is based are erroneous. Any such certificate or opinion of counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

 

Where any Person is required to make, give, or execute two or more applications, requests, consents, certificates, statements, opinions, or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

 

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Section 1.4 Acts of Holders; Record Dates.

 

(a)       Any request, demand, authorization, direction, notice, consent, waiver, or other action provided or permitted by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as otherwise expressly provided in this Indenture, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is expressly required by this Indenture, to the Company. Such instrument or instruments (and the action embodied in and evidenced by such instrument or instruments) are sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.1) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.

 

Without limiting the generality of the foregoing, a Holder, including a Depositary that (or whose nominee) is a Holder of a Global Security, may make, give, or take, by a proxy or proxies, duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver, or other action provided or permitted in this Indenture to be made, given, or taken by Holders, and a Depositary that (or whose nominee) is a Holder of a Global Security may provide its proxy or proxies to the beneficial owners of interests in any such Global Security.

 

(b)       The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him its execution. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

 

(c)       The Company may fix any day as the record date for the purpose of determining the Holders of Securities of any series entitled to give or take any request, demand, authorization, direction, notice, consent, waiver, or other action, or to vote on any action, authorized, or permitted to be given or taken by Holders of Securities of such series. If not set by the Company prior to the first solicitation of a Holder of Securities of such series made by any Person in respect of any such action, or, in the case of any such vote, prior to such vote, the record date for any such action or vote shall be the 30th day (or, if later, the date of the most recent list of Holders required to be provided pursuant to Section 7.1) prior to such first solicitation or vote, as the case may be. With regard to any record date for action to be taken by the Holders of one or more series of Securities, only the Holders of Securities of such series on such date (or their duly designated proxies) shall be entitled to give, take, or vote on the relevant action.

 

(d)       The ownership of Securities shall be proved by the Security Register.

 

(e)       Any request, demand, authorization, direction, notice, consent, waiver, or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer of, in exchange for, or in lieu of such Security in respect of anything done, omitted, or suffered to be done by the Trustee or the Company in reliance on such action, whether or not notation of such action is made upon such Security.

 

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(f)       Without limiting the foregoing, a Holder entitled to give or take any action under this Indenture with regard to any particular Security may do so with regard to all or any part of the principal amount of such Security or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any different part of such principal amount.

 

Section 1.5 Notices, Etc. to Trustee and Company.

 

Any request, demand, authorization, direction, notice, consent, waiver, or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

 

(1)       the Trustee by any Holder or by the Company shall be sufficient for every purpose under this Indenture if made, given, furnished, or filed in writing to or with the Trustee at its Corporate Trust Office, Attention: Corporate Trust Division - Corporate Finance Unit, or

 

(2)       the Company by the Trustee or by any Holder shall be sufficient for every purpose under this Indenture (unless otherwise expressly provided in this Indenture) if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first paragraph of this instrument or at any other address previously furnished in writing to the Trustee by the Company, Attention: Corporate Secretary.

 

The Trustee shall have the right, but shall not be required, to rely upon and comply with notices, instructions, directions or other communications sent by e-mail, facsimile and other similar unsecured electronic methods by persons believed by the Trustee to be authorized to give instructions and directions on behalf of the Company. The Trustee shall have no duty or obligation to verify or confirm that the person who sent such instructions or directions is, in fact, a person authorized to give instructions or directions on behalf of the Company; and the Trustee shall have no liability for any losses, liabilities, costs or expenses incurred or sustained by the Company as a result of such reliance upon or compliance with such notices, instructions, directions or other communications. The Company agrees to assume all risks arising out of the use of such electronic methods to submit notices, instructions, directions or other communications to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties. The Company shall use all reasonable endeavors to ensure that any such notices, instructions, directions or other communications transmitted to the Trustee pursuant to this Indenture are complete and correct. Any such notices, instructions, directions or other communications shall be conclusively deemed to be valid instructions from the Company to the Trustee for the purposes of this Indenture.

 

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Section 1.6 Notice to Holders; Waiver.

 

Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise expressly provided in this Indenture) if in writing and (i) mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Security Register, or (ii) in the event that a Depositary (or a nominee thereof) is a Holder of Securities issued in the form of Global Securities, then with respect to such Securities given by electronic, email or other means as such be acceptable to such Depositary, in all cases, not later than the latest date (if any), and not earlier than the earliest date (if any), prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

 

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose under this Indenture.

 

Section 1.7 Conflict with Trust Indenture Act.

 

If any provision of this Indenture limits, qualifies, or conflicts with a provision of the Trust Indenture Act that is required under such Act to be a part of and govern this Indenture, the latter provision shall control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, such provision shall be deemed to apply to this Indenture as so modified or to be excluded, as the case may be.

 

Section 1.8 Effect of Headings and Table of Contents.

 

The Article and Section headings in this Indenture and the Table of Contents are for convenience only and shall not affect the construction of this Indenture.

 

Section 1.9 Successors and Assigns.

 

All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

 

Section 1.10 Separability Clause.

 

In case any provision in this Indenture or in the Securities shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired by such invalid, illegal, or unenforceable provision.

 

Section 1.11 Benefits of Indenture.

 

Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties to this Indenture and their successors under this Indenture, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

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Section 1.12 Governing Law; Waiver of Jury Trial; Consent to Jurisdiction.

 

This Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York (including but not limited to N.Y. General Obligations Law Section 5-1401 and any successor statute thereto).

 

Each of the Company and the Trustee, and each Holder of a Security by its acceptance thereof, hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right it may have to trial by jury in any legal proceeding directly or indirectly arising out of or relating to this Indenture, the Securities or the transactions contemplated hereby or thereby.

 

Each of the Company and the Trustee irrevocably consents and submits, for itself and in respect of any of its assets or property, to the nonexclusive jurisdiction of any court of the State of New York or any United States court sitting, in each case, in the Borough of Manhattan, The City of New York, New York, United States of America, and of any appellate court in respect thereof in any suit, action or proceeding that may be brought in connection with this Indenture or the Securities, and waives any immunity from the jurisdiction of such courts. Each of the Company and the Trustee irrevocably waives, to the fullest extent permitted by law, any objection to any such suit, action or proceeding that may be brought in such courts whether on the grounds of venue, residence or domicile or on the ground that any such suit, action or proceeding has been brought in an inconvenient forum. Each of the Company and the Trustee agrees, to the fullest extent that it lawfully may do so, that final judgment in any such suit, action or proceeding brought in such a court shall be conclusive and binding upon the Company and the Trustee, respectively, and the Company waives, to the fullest extent permitted by law, any objection to the enforcement by any competent court in the Company’s jurisdiction of organization of judgments validly obtained in any such court in New York on the basis of such suit, action or proceeding.

 

Section 1.13 Legal Holidays.

 

In any case where any Interest Payment Date, Redemption Date, or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities, other than a provision of the Securities of any series which specifically states that such provision shall apply in lieu of this Section) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date, or Redemption Date, or at the Stated Maturity, provided that, if such payment is made on such next succeeding Business Day, no interest shall accrue with respect to the payment due on such date for the period from and after such Interest Payment Date, Redemption Date, or Stated Maturity, as the case may be.

 

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Article II

Security Forms

 

Section 2.1            Forms Generally .

 

The Securities of each series shall be in substantially such form or forms as shall be established by or pursuant to one or more Board Resolutions or in one or more indentures supplemental to this Indenture, or in an Officer’s Certificate pursuant to such Board Resolution or any such supplemental indenture, in each case with such appropriate insertions, omissions, substitutions, and other variations as are required or permitted by this Indenture, and may have such letters, numbers, or other marks of identification and such legends or endorsements placed on them as may be required to comply with the rules of any securities exchange or as may, consistently with this Indenture, be determined by the officers executing such Securities, as evidenced by their execution of the Securities. If the form of Securities of any series is established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 3.3 for the authentication and delivery of such Securities.

 

The definitive Securities, if any, shall be printed, lithographed, or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities.

 

Section 2.2            Form of Legend for Global Securities .

 

Any Global Security authenticated and delivered under this Indenture shall bear a legend (in addition to any legend that may be required by the applicable requirements of the Depositary) in substantially the following form:

 

This Security is a Global Security within the meaning of the Indenture referred to in this Security and is registered in the name of a Depositary or its nominee. This Security may not be transferred to, or registered or exchanged for Securities registered in the name of, any Person other than the Depositary or its nominee or a successor of such Depositary or a nominee of such successor and no such transfer may be registered, except in the limited circumstances described in the Indenture. Every Security authenticated and delivered upon registration of transfer of, or in exchange for or in lieu of, this Security shall be a Global Security subject to the foregoing, except in such limited circumstances.”

 

Section 2.3            Form of Trustee’s Certificate of Authentication .

 

The Trustee’s certificates of authentication shall be in substantially the following form:

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

Date: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
     
  By:  
    Authorized Signatory

 

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Article III

The Securities

 

Section 3.1            Amount Unlimited; Issuable in Series .

 

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

 

The Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution and, subject to Section 3.3, set forth, or determined in the manner provided, in an Officers’ Certificate pursuant to a Board Resolution or indenture supplemental to this Indenture, or established in one or more indentures supplemental to this Indenture, prior to the issuance of Securities of any series,

 

(1)         the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series);

 

(2)         any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 3.4, 3.5, 3.6, 9.6, or 11.7 and except for any Securities which, pursuant to Section 3.3, are deemed never to have been authenticated and delivered under this Indenture);

 

(3)         the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on Regular Record Date for such interest;

 

(4)         the date or dates on which the principal (and premium, if any) of the Securities of the series is payable;

 

(5)         the rate or rates at which the Securities of the series shall bear interest, if any, the date or dates from which such interest shall accrue, the Interest Payment Dates on which any such interest shall be payable, and the Regular Record Date for any interest payable on any Interest Payment Date;

 

(6)         the right, if any, to extend the interest payment periods and the duration of any such deferral period, including the maximum consecutive period during which interest payment periods may be extended;

 

(7)         the place or places in addition to the Borough of Manhattan, The City of New York, if any, where the principal of and any premium and interest on Securities of the series shall be payable;

 

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(8)         the period or periods within which, the price or prices at which, and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Company and, if other than by a Board Resolution, the manner in which any election by the Company to redeem the Securities shall be evidenced;

 

(9)         the obligation, if any, of the Company to redeem, purchase, or repay Securities of the series pursuant to any mandatory redemption, sinking fund, or analogous provision or at the option of a Holder of the Security, and the period or periods within which, the price or prices at which, and the terms and conditions upon which Securities of the series shall be redeemed, purchased, or repaid, in whole or in part, pursuant to such obligation;

 

(10)        if other than denominations of $1,000 and integral multiples of such denomination, the denomination or denominations in which Securities of the series shall be issuable;

 

(11)        if the amount of payments of principal of or any premium or interest on any Securities of the series may be determined with reference to an index or formula, the manner in which such amounts shall be determined;

 

(12)        if other than the principal amount of the Securities of the series, the portion of the principal amount of Securities which shall be payable upon declaration of acceleration of its Maturity pursuant to Section 5.2;

 

(13)        if the principal amount payable at the Stated Maturity of any Securities of the series will not be determinable as of any one or more dates prior to the Stated Maturity, the amount which shall be deemed to be the principal amount of such Securities as of any such date for any purpose under the Securities or this Indenture, including the principal amount which shall be due and payable upon any Maturity other than the Stated Maturity or which shall be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in any such case, the manner in which such amount deemed to be the principal amount shall be determined);

 

(14)        the application, if any, of either or both of Section 13.2 and Section 13.3 to the Securities of the series (including, in the case of Section 13.3, the covenants and any Events of Default not specified therein that are subject thereto) and, if other than by a Board Resolution, the manner in which any election pursuant to such Sections by the Company shall be evidenced;

 

(15)        whether the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depositary or Depositaries for such Global Security or Global Securities (if other than The Depository Trust Company), and any circumstances other than those set forth in Section 3.5 in which any such Global Security may be transferred to, and registered and exchanged for, Securities registered in the name of, a Person other than the Depositary for such Global Security or its nominee and in which any such transfer may be registered;

 

(16)        any Authenticating Agents, Paying Agents, or any other agents with respect to the Securities of the series;

 

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(17)        any other covenant or warranty included for the benefit of Securities of the series in addition to (and not inconsistent with) those included in this Indenture for the benefit of Securities of all series, or any other covenant or warranty included for the benefit of Securities of the series in lieu of any covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenant contained in Article X), or any provision that any covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenant contained in Article X) shall not be for the benefit of Securities of such series, or any change to or combination of the provisions of any such covenant or warranty included in this Indenture for the benefit of Securities of all series (including any covenants contained in Article X) which applies to the Securities of such series;

 

(18)        any addition to, deletion from, or change in the Events of Default which applies to any Securities of the series and any change in the right of the Trustee or the requisite Holders of such Securities to declare the principal amount of such Securities due and payable pursuant to Section 5.2;

 

(19)        the terms, if any, upon which the Securities of the series may be convertible into or exchanged for other securities of the Company and the terms and conditions upon which such conversion or exchange shall be effected; and

 

(20)        any other terms of the Securities of such series, or of any specified tenor thereof.

 

All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and (subject to Section 3.3) set forth, or determined in the manner provided, in the Officers’ Certificate referred to above or in any indenture supplemental to this Indenture.

 

Unless otherwise provided with respect to the Securities of any series, at the option of the Company, interest on the Securities of any series that bears interest may be paid by mailing a check to the address of the Person entitled to such interest as such address shall appear in the Security Register.

 

If any of the terms of the series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers’ Certificate setting forth the terms of the series.

 

Section 3.2            Denominations .

 

The Securities of each series shall be issuable in registered form without coupons in such denominations as shall be specified as contemplated by Section 3.1. In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiples of such denomination.

 

Section 3.3            Execution, Authentication, Delivery and Dating .

 

The Securities shall be executed on behalf of the Company by its Chairman, its Chief Executive Officer, its President, or one of its Vice Presidents, and may (but need not) have the corporate seal of the Company affixed or reproduced thereon and, if so affixed or reproduced, attested by its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the Securities may be manual or facsimile.

 

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Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities.

 

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with the documents referred to below in this Section 3.3, for the authentication and delivery of such Securities, and the Trustee shall authenticate and deliver such Securities to or upon a Company Order or pursuant to such procedures acceptable to the Trustee and to such recipients as may be specified from time to time by a Company Order. If so provided in or pursuant to the Board Resolution or supplemental indenture establishing the Securities of any series, the maturity date, original issue date, interest rate, and any other terms of any or all of the Securities of such series may be determined by or pursuant to such Company Order and procedures. If provided for in such procedures, such Company Order may authorize authentication and delivery pursuant to electronic instructions from the Company or its duly authorized agent, which instructions shall be promptly confirmed in writing. In authenticating such Securities and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive and (subject to Section 6.1) shall be fully protected in relying upon, unless and until such documents have been superseded or revoked:

 

(a)          a Company Order requesting such authentication and setting forth delivery instructions if the Securities are not to be delivered to the Company, provided that, with respect to Securities of a series subject to a Periodic Offering, (i) such Company Order may be delivered by the Company to the Trustee at any time prior to the delivery to the Trustee of the Securities of such series for authentication and delivery, (ii) the Trustee shall authenticate and deliver the Securities of such series for original issue from time to time, in an aggregate principal amount not exceeding the aggregate principal amount established for such series, pursuant to a Company Order or pursuant to such procedures acceptable to the Trustee as may be specified from time to time by a Company Order, and (iii) if so provided in or pursuant to the Board Resolution or supplemental indenture establishing the Securities of such series, the maturity date, original issue date, interest rate, and any other terms of any or all of the Securities of such series may be determined by a Company Order or pursuant to such procedures;

 

(b)          any Board Resolution, Officers’ Certificate and/or executed supplemental indenture referred to in Sections 2.1 and 3.1 by or pursuant to which the form or forms and terms of the Securities of such series were established;

 

(c)          an Officers’ Certificate setting forth the form or forms and the terms of the Securities of such series, stating that such form or forms and terms have been established pursuant to Sections 2.1 and 3.1 and comply with this Indenture, and covering such other matters as the Trustee may reasonably request; and

 

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(d)          an Opinion of Counsel, substantially to the effect that:

 

(i)          the form or forms of the Securities of such series have been duly authorized and established in conformity with the provisions of this Indenture;

 

(ii)         the terms of the Securities of such series (or the manner of determining such terms) have been established in conformity with the provisions of this Indenture; and

 

(iii)        that such Securities, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and similar laws of general applicability relating to or affecting creditors rights and to general equity principles and other customary qualifications and assumptions.

 

The Trustee shall not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee’s own rights, duties, liabilities or immunities under the Securities or this Indenture or otherwise.

 

Notwithstanding the provisions of Section 3.1 and of the preceding paragraph, if all Securities of a series are not to be originally issued at one time, it shall not be necessary to deliver the above specified documents at or prior to the time of authentication of each Security of such series if such documents are delivered at or prior to the authentication upon original issuance of the first Security of such series to be issued.

 

Each Security shall be dated the date of its authentication.

 

No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for in this Indenture executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered under this Indenture. Notwithstanding the foregoing, if any Security shall have been authenticated and delivered but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 3.9, for all purposes of this Indenture, such Security shall be deemed never to have been authenticated and delivered under this Indenture and shall never be entitled to the benefits of this Indenture.

 

Section 3.4            Temporary Securities .

 

Pending the preparation of definitive Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed, or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions, and other variations as the officers executing such Securities may determine, as evidenced by their execution of such Securities.

 

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If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange one or more definitive Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series and tenor.

 

Section 3.5            Registration, Registration of Transfer and Exchange .

 

The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office or in any other office or agency of the Company in a Place of Payment may sometimes be collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee is hereby appointed “Security Registrar” for the purpose of registering Securities and transfers of Securities as provided in this Indenture.

 

Upon surrender for registration of transfer of any Security of any series at the office or agency of the Company in a Place of Payment for that series, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor.

 

At the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor, upon surrender of the Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive.

 

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

 

Every Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed, by the Holder or his attorney duly authorized in writing.

 

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No service charge shall be made for any registration of transfer or exchange of Securities, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.4, 9.6, or 11.7 not involving any transfer.

 

The Company shall not be required (i) to issue, register the transfer of, or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 11.3 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.

 

Notwithstanding the foregoing and except as otherwise specified as contemplated by Section 3.1, if at any time the Depositary for the Securities of a series represented by a Global Security or Global Securities notifies the Company that it is unwilling or unable to continue as a Depositary for the Securities of such series or if at any time the Depositary for Securities of a series shall no longer be registered or in good standing under the Exchange Act or other applicable statute or regulation, the Company shall appoint a successor Depositary with respect to the Securities of such series. If a successor Depositary for the Securities of such series is not appointed by the Company or, if appointed, has not accepted such appointment, within 90 days after the Company receives such notice or becomes aware of such condition, the Company will execute, and the Trustee, upon Company Request, will authenticate and deliver, Securities of such series in definitive form in an aggregate principal amount equal to the principal amount of the Global Security or Global Securities representing Securities of such series in exchange for such Global Security or Global Securities.

 

In the event that (i) the Company at any time and in its sole discretion determines that the Securities of any series issued in the form of one or more Global Securities shall no longer be represented by such Global Security or Global Securities or (ii) there shall have occurred and be continuing an Event of Default with respect to the Securities of any series, the Company will execute, and the Trustee, upon Company Request or instructions from the Depositary, will authenticate and deliver, Securities of such series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or Global Securities representing such series in exchange for such Global Security or Global Securities.

 

Upon the occurrence in respect of any Global Security of any series of any one or more of the conditions specified in the preceding two paragraphs or such other conditions as may be specified as contemplated by Section 3.1 for such series, such Global Security may be exchanged for Securities registered in the names of, and the transfer of such Global Security may be registered to, such Persons (including Persons other than the Depositary with respect to such series and its nominees) as such Depositary shall direct. Notwithstanding any other provision of this Indenture, any Security authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, any Global Security shall also be a Global Security and shall bear the legend or legends specified in Section 2.2 except for any Security authenticated and delivered in exchange for, or upon registration of transfer of, a Global Security pursuant to the preceding sentence.

 

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Section 3.6            Mutilated, Destroyed, Lost, and Stolen Securities .

 

If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss, or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a protected purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost, or stolen Security, a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

In case any such mutilated, destroyed, lost, or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

 

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation to such issuance and any other expenses (including the fees and expenses of the Trustee) connected with such issuance.

 

Every new Security of any series issued pursuant to this Section in lieu of any destroyed, lost, or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost, or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that series duly issued under this Indenture.

 

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost, or stolen Securities.

 

Section 3.7            Payment of Interest; Interest Rights Preserved .

 

Except as otherwise provided as contemplated by Section 3.1 with respect to any series of Securities, interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest.

 

Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (“Defaulted Interest”) shall cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in clause (1) or (2) below:

 

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(1)         The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause. At such time the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the related Special Record Date to be mailed, first-class postage prepaid, to each Holder of Securities of such series at his address as it appears in the Security Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the related Special Record Date having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (2).

 

(2)         The Company may make payment to Holders of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

 

Section 3.8            Persons Deemed Owners .

 

Prior to due presentment of a Security for registration of transfer, the Company, the Trustee, and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and any premium and (subject to Section 3.7) any interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee, nor an agent of the Company or the Trustee shall be affected by notice to the contrary.

 

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No holder of any beneficial interest in any Global Security registered in the name of a Depositary or its nominee shall have any rights under this Indenture with respect to such Global Security, and such Depositary or nominee, as the case may be, may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing in this Indenture shall prevent the Company, the Trustee, or any agent of the Company or the Trustee from giving effect to any written certification, proxy, or other authorization furnished by a Depositary or its nominee pursuant to this Indenture. Furthermore, none of the Company, the Trustee, any Paying Agent, the Security Registrar, or any other agent of the Company or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in any such Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. The Company, the Trustee, any Paying Agent, the Security Registrar, or any other agent of the Company or the Trustee shall be entitled to deal with the Depositary, and any nominee thereof, that is the registered holder of any Global Security for all purposes of this Indenture relating to such Global Security (including the payment of principal, premium, if any, and interest and additional amounts, if any, and the giving of instructions or directions by or to the owner or holder of a beneficial ownership interest in such Global Security) as the sole holder of such Global Security and shall have no obligations to the beneficial owners thereof. None of the Trustee, the Paying Agent or the Security Registrar shall have any responsibility or liability for any acts or omissions of the Depositary with respect to such Global Security, for the records of any such depositary, including records in respect of beneficial ownership interests in respect of any such Global Security, for any transactions between the Depositary and any Depositary participant or between or among the Depositary, any such Depositary participant and/or any holder or owner of a beneficial interest in such Global Security, or for any transfers of beneficial interests in any such Global Security.

 

Section 3.9            Cancellation .

 

All Securities surrendered for payment, conversion, redemption, registration of transfer or exchange, or for credit against any sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered which the Company may have acquired in any manner whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities previously authenticated which the Company has not issued and sold, and all Securities so delivered shall be promptly cancelled by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of by the Trustee in accordance with its then customary procedures.

 

Section 3.10          Computation of Interest .

 

Except as otherwise specified as contemplated by Section 3.1 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months.

 

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Section 3.11          CUSIP Numbers .

 

The Company in issuing the Securities may use “CUSIP”, “ISIN” or other similar numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP”, “ISIN” or other similar numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee in writing of any change in “CUSIP”, “ISIN” or other similar numbers.

 

Article IV

Satisfaction and Discharge

 

Section 4.1            Satisfaction and Discharge of Indenture .

 

This Indenture shall upon Company Request cease to be of further effect, including the provisions of Article XIV (except as to any surviving rights of registration of transfer or exchange of Securities expressly provided for in this Indenture), and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when

 

(1)         either:

 

(A)         all Securities previously authenticated and delivered (other than (i) Securities which have been destroyed, lost, or stolen and which have been replaced or paid as provided in Section 3.6 and (ii) Securities for whose payment money has previously been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in Section 10.3) have been delivered to the Trustee for cancellation; or

 

(B)         all such Securities not previously delivered to the Trustee for cancellation

 

(i)          have become due and payable, or

 

(ii)         will become due and payable at their Stated Maturity within one year, or

 

(iii)        are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company,

 

and the Company, in the case of (i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee as trust funds in trust for the purpose an amount sufficient to pay and discharge the entire indebtedness on such Securities not previously delivered to the Trustee for cancellation (other than Securities which have been destroyed, lost, or stolen and which have been replaced or paid as provided in Section 3.6), for principal and any premium and interest to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;

 

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(2)         the Company has paid or caused to be paid all other sums payable by the Company under this Indenture; and

 

(3)         the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this Indenture relating to the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 6.7, the obligations (if any) of the Company to any Authenticating Agent under Section 6.14 and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (1) of this Section, the obligations of the Trustee under Section 4.2 and the last paragraph of Section 10.3 shall survive.

 

In the event Securities of two or more series were at any time issued under this Indenture, the Trustee shall be required to execute an instrument acknowledging satisfaction and discharge of this Indenture only if requested to do so with respect to the Securities of all series as to which it is Trustee and if the conditions of satisfaction and discharge of this Indenture contained in this Section 4.1 in respect of such Securities have been satisfied. In the event there are two or more Trustees under this Indenture, the effectiveness of any such instrument shall be conditioned upon receipt of such instruments from all such Trustees.

 

Section 4.2            Application of Trust Money .

 

Subject to the provisions of the last paragraph of Section 10.3, all money deposited with the Trustee pursuant to Section 4.1 shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled to such money, of the principal and any premium and interest for whose payment such money has been deposited with the Trustee.

 

Article V

Remedies

 

Section 5.1            Events of Default .

 

“Event of Default,” wherever used herein with respect to Securities of any series, means any one of the following events, unless in the establishing Board Resolution, supplemental indenture or Officer’s Certificate, it is provided that such series shall not have the benefit of said Event of Default:

 

 

(1)         failure to pay any interest on the Securities within 30 days after such interest becomes due and payable by the terms of the Securities of such series;

 

(2)         failure to pay principal of (or premium, if any, on) the Securities at maturity, or if applicable, the redemption price, when the same becomes due and payable;

 

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(3)          failure to pay any sinking fund installment as and when the same shall become due and payable by the terms of the Securities, and continuance of such default for a period of 30 days;

 

(4)         failure to comply with (or obtain a waiver with respect to) any of the covenants or agreements in the Securities or this Indenture (other than an agreement or covenant that has been expressly included in this Indenture solely for the benefit of another series of Securities) for 90 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company by the Holders of at least 25% in principal amount of all outstanding Securities affected by that failure a written notice specifying such failure and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder;

 

(5)         the Company or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

 

(a)          commences a voluntary case;

 

(b)          consents to the entry of an order for relief against it in an involuntary case;

 

(c)          consents to the appointment of a Custodian of it or for all or substantially all of its property;

 

(d)          makes a general assignment for the benefit of its creditors; or

 

(e)          generally is unable to pay its debts as the same become due;

 

(6)         a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(a)          is for relief against the Company or any Significant Subsidiary in an involuntary case;

 

(b)          appoints a Custodian of the Company or any Significant Subsidiary or for all or substantially all of its property; or

 

(c)          orders the liquidation of the Company or any Significant Subsidiary; and

 

(d)          the order or decree remains unstayed and in effect for 90 days;

 

(7)         a default or defaults with respect to any issue or issues of other Debt of the Company or any Subsidiary having an outstanding aggregate principal amount of $35 million for all such issues of all such Persons, whether such Debt now exists or shall hereafter be created, which default or defaults shall constitute a failure to pay all or any portion of the principal of such Debt when due and payable or shall have resulted in such Debt becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable and such Debt has not been discharged in full or such acceleration has not been rescinded or annulled (by cure, waiver or otherwise) within 60 days of such acceleration; provided, however, that any secured Debt in excess of the limits set forth above shall be deemed to have been declared due and payable if the lender in respect thereof takes any action to enforce a security interest against, or an assignment of, or to collect on, seize, dispose of or apply any assets of the Company or its Subsidiaries (including lock-box and other similar arrangements) securing such Debt, or to set off against any bank accounts of the Company or its Subsidiaries in excess of $35 million in the aggregate; and

 

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(8)         any other Event of Default provided in the supplemental indenture, Officers’ Certificate or Board Resolution under which such series of Securities is issued or in the form of Security for such series.

 

The term “Bankruptcy Law” means title 11, U.S. Code or any similar Federal or State law for the relief of debtors or any comparable statute applicable to the Company or a Significant Subsidiary. The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

Section 5.2            Acceleration of Maturity; Rescission and Annulment .

 

If an Event of Default with respect to Securities of any series at the time outstanding occurs and is continuing (other than an Event of Default referred to in Section 5.1(5) or (6)) then in every such case the Trustee or the Holders of not less than 25% in principal amount of the outstanding Securities of that series may declare the principal amount (or, if any Securities of that series are Discount Securities, such portion of the principal amount as may be specified in the terms of such Securities) of and accrued and unpaid interest, if any, on all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) and accrued and unpaid interest, if any, shall become immediately due and payable. If an Event of Default specified in Section 5.1(5) or (6) shall occur, the principal amount (or specified amount) of and accrued and unpaid interest, if any, on all outstanding Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

 

At any time after such a declaration of acceleration with respect to any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the outstanding Securities of that series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if (i) the Company has paid or deposited with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of that series and the principal of (and premium, if any, on) any and all Securities of that series that shall have become due otherwise than by acceleration (with interest upon such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, upon overdue installments of interest, at the rate per annum expressed in the Securities of that series to the date of such payment or deposit) and the amount payable to the Trustee pursuant to Section 6.7 and (ii) all Events of Default with respect to Securities of that series, other than the non-payment of the principal and interest, if any, of Securities of that series which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 5.13.

 

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No such rescission shall affect any subsequent Default or impair any right consequent thereon.

 

Section 5.3            Collection of Indebtedness and Suits for Enforcement by Trustee .

 

The Company covenants that if:

 

(1)         default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days;

 

(2)         default is made in the payment of the principal of (or premium, if any, on) any Security at its Maturity; or

 

(3)         default is made in the making or satisfaction of any sinking fund or analogous obligation when the same becomes due pursuant to the terms of any Security,

 

then the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and any premium and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and premium and on any overdue interest, at the rate or rates prescribed in such Securities, and, in addition, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents, and counsel.

 

If the Company fails to pay such amounts immediately upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree, and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

 

If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other proper remedy.

 

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Section 5.4            Trustee May File Proofs of Claim .

 

In case of any judicial proceeding relative to the Company (or any other obligor upon the Securities), its property, or its creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator, or other similar official in any such judicial proceeding is authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.7.

 

No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment, or composition affecting the Securities or the rights of any Holder or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding; provided , however , the Trustee may vote on behalf of the Holders for the election of a trustee in bankruptcy or similar official and may be a member of a creditors, or other similar committee.

 

Section 5.5            Trustee May Enforce Claims Without Possession of Securities .

 

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production of such Securities in any related proceeding, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents, and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

Section 5.6            Application of Money Collected .

 

Any money collected by the Trustee pursuant to this Article or, after an Event of Default, any money or other property distributable in respect of the Company’s obligations under this Indenture shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or any premium or interest, upon presentation of the Securities and the notation on such Securities of the payment if only partially paid and upon surrender of such Securities if fully paid:

 

FIRST: To the payment of all amounts due the Trustee (including any predecessor trustee) under Section 6.7; and

 

SECOND: To the payment of amounts then due and unpaid to the holders of Senior Debt, to the extent required by Article XIV;

 

THIRD: To the payment of the amounts then due and unpaid for principal of and any premium and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and any premium and interest, respectively; and

 

FOURTH: To the Company.

 

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Section 5.7            Limitation on Suits .

 

No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy under this Indenture, unless:

 

(1)         such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series;

 

(2)         the Holders of not less than 25% in principal amount of the Outstanding Securities of that series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee under the Indenture;

 

(3)         such Holder or Holders have offered to the Trustee indemnity reasonably satisfactory to the Trustee against the costs, expenses, and liabilities to be incurred in compliance with such request;

 

(4)         the Trustee for 60 days after its receipt of such notice, request, and offer of indemnity has failed to institute any such proceeding; and

 

(5)         no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities of that series;

 

it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb, or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal and ratable benefit of all of such Holders.

 

Section 5.8            Unconditional Right of Holders to Receive Principal, Premium, and Interest .

 

Subject to Article XIV and notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and any premium and (subject to Section 3.7) any interest on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption or mandatory repurchase, on the Redemption Date or mandatory repurchase date, as applicable), and to institute suit for the enforcement of any such payment and such rights shall not be impaired without the consent of such Holder.

 

Section 5.9            Restoration of Rights and Remedies .

 

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions under this Indenture and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

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Section 5.10          Rights and Remedies Cumulative .

 

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost, or stolen Securities in the last paragraph of Section 3.6, no right or remedy conferred in this Indenture upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given under this Indenture or now or in the future existing at law or in equity or otherwise. The assertion or employment of any right or remedy under this Indenture, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

Section 5.11          Delay or Omission Not Waiver .

 

No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of or acquiescence in any such Event of Default. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 5.12          Control by Holders .

 

The Holders of a majority in principal amount of the Outstanding Securities of any series shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such series, provided that

 

(1)         such direction shall not be in conflict with any rule of law or with this Indenture,

 

(2)         the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and

 

(3)         the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer or Officers of the Trustee, determine that the proceeding so directed would involve the Trustee in personal liability.

 

Section 5.13          Waiver of Past Defaults .

 

The Holders of not less than a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Securities of such series waive any past default under this Indenture with respect to such series and its consequences, except a default (1) in the payment of the principal of or any premium or interest on any Security of such series, or (2) in respect of a covenant or provision of this Indenture which under Article IX cannot be modified or amended without the consent of the Holder of each Outstanding Security of such affected series.

 

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Upon any such waiver, such default shall cease to exist, and any Event of Default arising from such default shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any consequent right.

 

Section 5.14          Undertaking for Costs .

 

All parties to this Indenture agree, and each Holder of any Securities by his acceptance of such Securities shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered, or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorney’s fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 5.14 shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the outstanding Securities of any series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any) or interest on any Securities on or after the Stated Maturity or Maturities expressed in such Securities (or, in the case of redemption or mandatory repurchase, on or after the Redemption Date or mandatory repurchase date, as applicable).

 

Article VI

The Trustee

 

Section 6.1            Certain Duties and Responsibilities .

 

(a)          Except during the continuance of an Event of Default,

 

(1)         the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

 

(2)         in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts, statements, opinions or conclusions stated therein).

 

(b)          In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

 

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(c)          No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that

 

(1)         this Subsection (c) shall not be construed to limit the effect of Subsections (a) or (d) of this Section;

 

(2)         the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and

 

(3)         the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Securities of any series, determined as provided herein, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such series.

 

(d)          No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(e)          Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 6.1.

 

Section 6.2            Notice of Defaults .

 

Within 90 days after the occurrence of any default hereunder with respect to the Securities of any series, the Trustee shall transmit by first-class mail, postage prepaid, to all Holders of Securities of such series, as their names and addresses appear in the Security Register (or in case that a Depositary (or a nominee thereof) is a Holder of Securities issued in the form of Global Securities, then with respect to such Securities give by electronic, email or other means as such be acceptable to such Depositary), notice of such default hereunder known to the Trustee, unless such default shall have been cured or waived; provided , however , that except in the case of default in the payment of the principal of or the interest on any of the Securities of such series, or in the payment of any sinking fund installment or analogous payment on such series, the Trustee shall be protected in withholding such notice if and so long as the board of directors or trustees or a committee comprised of Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of such series. For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Securities of such series.

 

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Section 6.3            Certain Rights of Trustee .

 

Subject to the provisions of Section 6.1:

 

(a)          the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

(b)          any request or direction of the Company mentioned in this Indenture shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;

 

(c)          whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering, or omitting any action under this Indenture, the Trustee (unless other evidence be specifically prescribed in this Indenture) may, in the absence of bad faith on its part, conclusively rely upon an Officers’ Certificate;

 

(d)          the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered, or omitted by it under this Indenture in good faith and in reliance on such advice or Opinion of Counsel;

 

(e)          the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to the Trustee against the costs, expenses, and liabilities which might be incurred by it in compliance with such request or direction;

 

(f)          the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness, or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records, and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation;

 

(g)          the Trustee may execute any of the trusts or powers or perform any duties under this Indenture either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it;

 

(h)          the Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

 

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(i)          the Trustee shall not be charged with knowledge of any default or Event of Default with respect to the Securities unless written notice of such default or Event of Default shall have been given to a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee by the Company or by any Holder of the Securities, and such notice references the Securities and this Indenture;

 

(j)          the permissive rights of the Trustee enumerated herein shall not be construed as duties;

 

(k)          the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder;

 

(l)          the Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded;

 

(m)          anything in this Indenture notwithstanding, in no event shall the Trustee be liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to loss of profit), even if the Trustee has been advised as to the likelihood of such loss or damage and regardless of the form of action; and

 

(n)          the Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its control, including, without limitation, any provision of any law or regulation or any act of any governmental authority, acts of God; earthquakes; fire; flood; terrorism; wars and other military disturbances; sabotage; epidemics; riots; interruptions; loss or malfunctions of utilities, computer (hardware or software) or communication services; accidents; labor disputes; acts of civil or military authority and governmental action.

 

Section 6.4            Not Responsible for Recitals or Issuance of Securities .

 

The recitals contained in this Indenture and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee or any Authenticating Agent shall not be accountable for the use or application by the Company of Securities or the proceeds from such Securities. The Trustee shall not be responsible to make any calculation with respect to any matter under this Indenture. The Trustee shall have no duty to monitor or investigate the Company’s compliance with or the breach of, or cause to be performed or observed, any representation, warranty, or covenant, or agreement of any Person, other than the Trustee, made in this Indenture.

 

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Section 6.5            May Hold Securities .

 

The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar, or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 6.8 and 6.13, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar, or such other agent.

 

Section 6.6            Money Held in Trust .

 

Money held by the Trustee in trust under this Indenture need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it under this Indenture except as otherwise agreed in writing with the Company.

 

Section 6.7            Compensation and Reimbursement .

 

The Company agrees:

 

(1)         to pay to the Trustee from time to time such compensation as shall be agreed in writing between the Company and the Trustee for all services rendered by it under this Indenture (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

 

(2)         except as otherwise expressly provided in this Indenture, to reimburse the Trustee upon its request for all reasonable expenses, disbursements, and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement, or advance as may be attributable to its gross negligence or willful misconduct; and

 

(3)         to indemnify each of the Trustee and any predecessor Trustee and their officers, agents, directors and employees for, and to hold them harmless against, any and all loss, damage, claim, liability, or expense, including fees and expenses of counsel and including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), incurred without gross negligence or willful misconduct on their part, arising out of or in connection with the acceptance or administration of the trust or trusts under this Indenture, including the costs and expenses of defending itself against any claim (whether asserted by the Company, or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties under this Indenture, or in connection with enforcing the provisions of this Section.

 

To secure the Company’s obligations under this Section, the Trustee shall have a lien prior to the Securities upon all money or property held or collected by the Trustee in its capacity as Trustee, except for such money and property which is held in trust to pay principal (and premium, if any) or interest on particular Securities, and the claims of the Trustee under this Section shall not be subject to the provisions of Article XIV;

 

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In addition to, and without prejudice to its other rights under this Indenture, when the Trustee incurs any expenses or renders any services after the occurrence of an Event of Default specified in Section 5.1(1) or (2), such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under the United States Bankruptcy Code (Title 11 of the United States Code) or any similar Federal or State law for the relief of debtors; and

 

The provisions of this Section 6.7 shall survive the satisfaction and discharge of the Indenture, the resignation or removal of the Trustee and the termination for any reason of this Indenture.

 

“Trustee” for purposes of this Section shall include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder.

 

Section 6.8            Disqualification; Conflicting Interests .

 

If the Trustee has or shall acquire a conflicting interest within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. For the purpose of the second paragraph of Section 310(b) of the Trust Indenture Act, the phrase “default (as such term is defined in such indenture, but exclusive of any period of grace or requirement of notice)” is hereby defined to mean any event which is, or after notice or lapse of time or both would become, an Event of Default. To the extent permitted by the Trust Indenture Act, the Trustee shall not be deemed to have a conflicting interest by virtue of being a trustee under this Indenture with respect to Securities of more than one series.

 

Section 6.9            Corporate Trustee Required; Eligibility .

 

There shall at all times be a Trustee under this Indenture which shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000. If such Person publishes reports of condition at least annually, pursuant to law or to the requirements of its supervising or examining authority, then for the purposes of this Section (and to the extent permitted by the Trust Indenture Act), the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect specified in this Article.

 

Section 6.10          Resignation and Removal; Appointment of Successor .

 

(a)          No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 6.11.

 

(b)          The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice of such resignation to the Company.

 

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(c)          The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company.

 

(d)          If at any time:

 

(1)         the Trustee shall fail to comply with Section 6.8 after written request for such compliance by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or

 

(2)         the Trustee shall cease to be eligible under Section 6.9 and shall fail to resign after written request by the Company or by any such Holder, or

 

(3)         the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation, or liquidation,

 

then, in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Securities, or (ii) subject to Section 5.14, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment of a successor Trustee or Trustees.

 

(e)          If the instrument of acceptance by a successor Trustee required by Section 6.11 shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation or removal, the Trustee resigning or being removed may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

(f)          If the Trustee shall resign, be removed, or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series) and shall comply with the applicable requirements of Section 6.11. If, within one year after such resignation, removal, or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, immediately upon its acceptance of such appointment in accordance with the applicable requirements of Section 6.11, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 6.11, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

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(g)          The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series to all Holders of Securities of such series in the manner provided in Section 1.6. Each notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office.

 

Section 6.11          Acceptance of Appointment by Successor .

 

(a)          In case of the appointment of a successor Trustee under this Indenture with respect to all Securities, every such successor Trustee so appointed shall execute, acknowledge, and deliver to the Company and to the retiring Trustee an instrument accepting such appointment. Upon such delivery, the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed, or conveyance, shall become vested with all the rights, powers, trusts, and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges and all other amounts payable to it hereunder, execute and deliver an instrument transferring to such successor Trustee all the rights, powers, and trusts of the retiring Trustee and shall duly assign, transfer, and deliver to such successor Trustee all property and money held by such retiring Trustee under this Indenture, subject nevertheless to its lien provided for in Section 6.7.

 

(b)          In case of the appointment under this Indenture of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee, and each successor Trustee with respect to the Securities of one or more series shall execute and deliver a supplemental indenture wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to the Securities of all series, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee, it being understood that nothing in this Indenture or in such supplemental indenture shall constitute such Trustees cotrustees of the same trust and that each such Trustee shall be trustee of a trust or trusts under this Indenture separate and apart from any trust or trusts under this Indenture administered by any other such Trustee; and, upon the execution and delivery of such supplemental indenture, the resignation or removal of the retiring Trustee shall become effective to the extent provided in such supplemental indenture and each such successor Trustee, without any further act, deed, or conveyance, shall become vested with all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; and such retiring Trustee shall duly assign, transfer, and deliver to such successor Trustee all property and money held by such retiring Trustee under this Indenture with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, subject nevertheless to its lien provided for in Section 6.7.

 

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(c)          Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers, and trusts referred to in paragraph (a) and (b) of this Section, as the case may be.

 

(d)          No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

 

Section 6.12          Merger, Conversion, Consolidation, or Succession to Business .

 

Any Person into which the Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion, or consolidation to which the Trustee shall be a party, or any Person succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee under this Indenture, provided such Person shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties to this Indenture. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion, or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

 

Section 6.13          Preferential Collection of Claims Against Company .

 

If and when the Trustee shall be or become a creditor of the Company or any other obligor upon the Securities (other than by reason of a relationship described in Section 311(b) of the Trust Indenture Act), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company or any such other obligor. For purposes of Section 311(b) of the Trust Indenture Act:

 

(A)         the term “cash transaction” means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand; and

 

(B)         the term “self-liquidating paper” means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company or such obligor for the purpose of financing the purchase, processing, manufacturing, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Company or such obligor arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation.

 

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Section 6.14          Appointment of Authenticating Agent .

 

The Trustee may appoint an Authenticating Agent or Agents (which may be an affiliate of the Company) with respect to one or more series of Securities which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series issued upon original issue and upon exchange, registration of transfer, or partial redemption or conversion, or pursuant to Section 3.6, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any of its states, or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by federal or state authority. If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of the supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.

 

Any Person into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion, or consolidation to which such Authenticating Agent shall be a party, or any Person succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such Person shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

 

An Authenticating Agent may resign at any time by giving written notice to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, as their names and addresses appear in the Security Register. Any successor Authenticating Agent upon acceptance of its appointment under this Indenture shall become vested with all the rights, powers, and duties of its predecessor, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

 

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The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section.

 

If an appointment with respect to one or more series is made pursuant to this Section, the Securities of such series may have endorsed on it, in addition to the Trustee’s certificate of authentication, an alternative certificate of authentication in the following form:

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

  THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
     
  By:  
    As Authenticating Agent
     
  By:  
    Authorized Officer

 

Article VII

Holder’s Lists and Reports by Trustee and Company

 

Section 7.1            Company to Furnish Trustee Names and Addresses of Holders .

 

The Company will furnish or cause to be furnished to the Trustee:

 

(a)          semi-annually, not later than June 30 and December 31 in each year, a list for each series, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of Securities of such series as of the preceding June 15 or December 15, as the case may be, and

 

(b)          at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished;

 

provided , that if and so long as the Trustee shall be the Security Registrar for such series, such lists shall not be required to be furnished.

 

Section 7.2            Preservation of Information; Communications to Holders .

 

(a)          The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in Section 7.1 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar. The Trustee may dispose of as it deems fit any list furnished to it as provided in Section 7.1 upon receipt of a new list so furnished.

 

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(b)          The rights of Holders to communicate with other Holders with respect to their rights under this Indenture or under the Securities, and the corresponding rights and privileges of the Trustee, shall be as provided by the Trust Indenture Act.

 

(c)          Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held accountable by reason of any disclosure of information as to names and addresses of Holders made pursuant to the Trust Indenture Act.

 

Section 7.3            Reports by Trustee .

 

(a)          The Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to the Trust Indenture Act. To the extent that any such report is required by the Trust Indenture Act with respect to any 12-month period, such report shall cover the 12-month period ending May 15 and shall be transmitted (in accordance with the Trust Indenture Act) by the next succeeding July 15.

 

(b)          A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which any Securities are listed, with the Commission, and with the Company. The Company will promptly notify the Trustee when any Securities are listed on any stock exchange.

 

Section 7.4            Reports by Company .

 

The Company shall file with the Trustee and the Commission, and transmit to Holders, such information, documents, and other reports, and such summaries, as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to such Trust Indenture Act; provided that any such information, documents, or reports required to be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within 15 days after the same is so required to be filed with the Commission.

 

Delivery of such reports, information, and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee shall be entitled to rely exclusively on Officers’ Certificates).

 

Article VIII

Consolidation, Merger, Conveyance, Transfer or Lease

 

Section 8.1            Company May Consolidate, Etc., Only on Certain Terms .

 

The Company shall not consolidate with or merge into any other Person or convey, transfer, or lease its properties and assets substantially as an entirety to any Person, and the Company shall not permit any Person to consolidate with or merge into the Company or convey, transfer, or lease its properties and assets substantially as an entirety to the Company, unless:

 

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(1)         in case the Company shall consolidate with or merge into another Person or convey, transfer, or lease its properties and assets substantially as an entirety to any Person, the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Company substantially as an entirety shall expressly assume, by a supplemental indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of and any premium and interest on all the Securities and the performance or observance of every covenant of this Indenture on the part of the Company to be performed or observed;

 

(2)         immediately after giving effect to such transaction and treating any indebtedness which becomes an obligation of the Company or a Subsidiary as a result of such transaction as having been incurred by the Company or such Subsidiary at the time of such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing; and

 

(3)         the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer, or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this Article and that all conditions precedent in this Indenture provided for relating to such transaction have been complied with.

 

Section 8.2            Successor Substituted .

 

Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer, or lease of the properties and assets of the Company substantially as an entirety in accordance with Section 8.1, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer, or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company in this Indenture, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

 

Article IX

Supplemental Indentures

 

Section 9.1            Supplemental Indentures Without Consent of Holders .

 

Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more supplemental indentures, in form satisfactory to the Trustee, for any of the following purposes:

 

(1)         to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company in this Indenture and in the Securities; or

 

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(2)         to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power conferred in this Indenture upon the Company; or

 

(3)         to add any additional Events of Default for the benefit of the Holders of all or any series of Securities (and if such additional Events of Default are to be for the benefit of less than all series of Securities, stating that such additional Events of Default are expressly being included solely for the benefit of such series); or

 

(4)         to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or

 

(5)         to add to, change, or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change, or elimination (i) shall neither (A) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (B) modify the rights of the Holder of any such Security with respect to such provision or (ii) shall become effective only when there is no such Security Outstanding; or

 

(6)         to secure the Securities; or

 

(7)         to establish the form or forms or terms of Securities of any series as permitted by Sections 2.1 and 3.1; or

 

(8)         to evidence and provide for the acceptance of appointment under this Indenture by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee, pursuant to the requirements of Section 6.11(b);

 

(9)         to comply with any requirements of the Commission in connection with qualifying this Indenture under the Trust Indenture Act or conform this Indenture or the Securities of any series to the description thereof contained in any applicable prospectus, prospectus supplement, free writing prospectus, offering memorandum, term sheet or other offering document;

 

(10)        to cure any ambiguity, mistake, defect or inconsistency; or

 

(11)        to make any change, provided that such change shall not adversely affect the interests of the Holders of Securities of any series in any material respect.

 

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Section 9.2            Supplemental Indentures With Consent of Holders .

 

With the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of a series, by Act of such Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into a supplemental indenture or indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided , however , that no such supplemental indenture entered into pursuant to this Section 9.2 shall, without the consent of the Holder of each Outstanding Security affected by such supplemental indenture,

 

(1)         change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce its principal amount or rate of interest or any premium payable upon its redemption, or reduce the amount of the principal of an Original Issue Discount Security or any other Security that would be due and payable upon a declaration of acceleration of its Maturity pursuant to Section 5.2, or adversely affect any right of repayment at the option of the Holder of any Security, or change any Place of Payment where any Security or any premium or interest is payable, or impair the right to institute suit for the enforcement of any such payment on or after its Stated Maturity (or, in the case of redemption or mandatory repurchase, on or after the Redemption Date or mandatory repurchase date, as applicable), or modify the provisions of this Indenture with respect to the subordination of the Securities in a manner adverse to the Holders, or

 

(2)         reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with the provisions of or defaults under this Indenture and their consequences provided for in this Indenture, or

 

(3)         modify any of the provisions of this Section, Section 5.13, or Section 10.8, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each affected Outstanding Security, provided , however , that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Section 6.11(b) and 9.1(8).

 

A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series.

 

It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance of such supplemental indenture.

 

Section 9.3            Execution of Supplemental Indentures .

 

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications of the trusts created by this Indenture, the Trustee shall be entitled to receive in addition to the documents required by Section 1.2, and (subject to Section 6.1) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise.

 

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Section 9.4            Effect of Supplemental Indentures .

 

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance with such supplemental indenture, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities previously or subsequently authenticated and delivered under this Indenture shall be bound by such supplemental indenture.

 

Section 9.5            Conformity With Trust Indenture Act .

 

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act.

 

Section 9.6            Reference in Securities to Supplemental Indentures .

 

Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Company, bear a notation in form approved by the Company as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series.

 

Section 9.7            Notice of Supplemental Indentures .

 

After any supplemental indenture under this Article becomes effective, the Company may give to the Holders of Securities, in the manner referred to in Section 1.6, a notice briefly describing such supplemental indenture; provided, however, that the failure to give such notice to all Holders of Securities, or any defect therein, shall not impair or affect the validity of such supplemental indenture.

 

Article X

Covenants

 

Section 10.1          Payment of Principal, Premium, and Interest .

 

The Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay the principal of and any premium and interest on the Securities of that series in accordance with the terms of the Securities and this Indenture.

 

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Section 10.2          Maintenance of Office or Agency .

 

The Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with its address, such presentations, surrenders, notices, and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company appoints the Trustee as its agent to receive all such presentations, surrenders, notices, and demands.

 

The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided , however , that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

 

Section 10.3          Money for Securities Payments to Be Held in Trust .

 

If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date of the principal of or any premium or interest on any of the Securities of that series, segregate and hold in trust for the benefit of the Persons entitled to such principal, premium, or interest a sum sufficient to pay the principal and any premium and interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as provided in this Indenture and will promptly notify the Trustee of its action or failure to act.

 

Whenever the Company shall have one or more Paying Agents for any series of Securities, it will, prior to each due date of the principal of or any premium or interest on any Securities of that series, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee in writing of its action or failure to act.

 

The Company will cause each Paying Agent for any series of Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will (i) comply with the provisions of the Trust Indenture Act applicable to it as a Paying Agent and (ii) during the continuance of any default by the Company (or any other obligor upon the Securities of that series) in the making of any payment in respect of the Securities of that series, and upon the written request of the Trustee, immediately pay to the Trustee all sums held in trust by such Paying Agent for payment in respect of the Securities of that series.

 

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The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Subject to applicable abandoned property laws, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or any premium or interest on any Security of any series and remaining unclaimed for two years after such principal, premium, or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee, shall cease at such time.

 

Section 10.4          Statement by Officers as to Default .

 

The Company will deliver to the Trustee, within 120 days after the end of each fiscal year of the Company ending after the date of this Indenture, an Officers’ Certificate (one of the signers of which shall be the principal executive officer, principal financial officer, or principal accounting officer of the Company), stating whether or not, to the best knowledge of the signers, the Company is in default in the performance and observance of any of the terms, provisions, and conditions of this Indenture (without regard to any period of grace or requirement of notice provided under this Indenture) and, if the Company shall be in default, specifying all such defaults and their nature and status of which they may have knowledge. The Company will deliver to the Trustee written notice of the occurrence of any Event of Default or default (which word has the meaning of the word “default” as used in Section 6.2), within ten (10) Business Days of the Company becoming aware of any such Event of Default or default and setting forth the detail of such Event of Default or default and the action the Company proposes to take with respect thereto.

 

Section 10.5          Existence .

 

Subject to Article VIII, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its existence, rights (charter and statutory), and franchises; provided , however , that the Company shall not be required to preserve any such right or franchise if the Board of Directors shall determine that its preservation is no longer desirable in the conduct of the business of the Company and that its loss is not disadvantageous in any material respect to the Holders.

 

Article XI

Redemption of Securities

 

Section 11.1          Applicability of Article .

 

Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 3.1 for Securities of any series) in accordance with this Article.

 

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Section 11.2          Election to Redeem; Notice to Trustee .

 

The election of the Company to redeem any Securities shall be evidenced by a Board Resolution or in another manner specified as contemplated by Section 3.1 for such Securities. In case of any redemption at the election of the Company, the Company shall, at least 60 calendar days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the principal amount of Securities of such series to be redeemed and, if applicable, of the tenor of the Securities to be redeemed. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers’ Certificate evidencing compliance with such restriction.

 

Section 11.3          Selection by Trustee of Securities to Be Redeemed .

 

If less than all the Securities of any series are to be redeemed (unless all of the Securities of such series and of a specified tenor are to be redeemed or such series is comprised of a single Security), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption (i) in the case of Global Securities, (a) by lot or such other similar method in accordance with applicable procedures of the Depositary or (b) if there are no such requirements of the Depositary, on a pro rata basis and in compliance with any applicable securities exchange rules or (ii) by such method as the Trustee shall deem fair and appropriate (which may include pro rata or by lot) and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple of such denomination) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series. If less than all of the Securities of such series and of a specified tenor are to be redeemed (unless such series is comprised of a single Security), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series and specified tenor not previously called for redemption in accordance with the preceding sentence.

 

Unless all of the Securities of such series and of a specified tenor are to be redeemed or such series is comprised of a single Security, the Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Securities (other than Securities comprised of a single Security) selected for partial redemption, the principal amount thereof to be redeemed. In the case of any such redemption in part, the unredeemed portion of the principal amount of the Security shall be in an authorized denomination (which shall not be less than the minimum authorized denomination) of such Security.

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed.

 

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Section 11.4          Notice of Redemption .

 

Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed, at his address appearing in the Security Register.

 

All notices of redemption shall state:

 

(1)         the Redemption Date,

 

(2)         the Redemption Price (or, if not determinable, the methodology for determining the Redemption Price) and accrued interest, if any,

 

(3)         if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption of any Securities, the principal amounts) of the particular Securities to be redeemed, and that on or after the date fixed for redemption, upon surrender of such Security, a new Security or Securities of such series in authorized denominations for an aggregate principal amount equal to the unredeemed portion will be issued,

 

(4)         that on the Redemption Date the Redemption Price and accrued interest, if any, will become due and payable upon each such Security to be redeemed and that interest on such Security will cease to accrue on and after such date,

 

(5)         the place or places where such Securities are to be surrendered for payment of the Redemption Price and accrued interest, if any,

 

(6)         that the redemption is for a sinking fund, if such is the case, and

 

(7)         the CUSIP numbers”, “ISIN” or other similar numbers, if any, of the Securities to be redeemed.

 

Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company’s request (delivered to the Trustee, together with a form of notice of redemption, at least 45 days (unless a shorter period shall be acceptable to the Trustee) prior to the Redemption Date) , by the Trustee in the name and at the expense of the Company and shall be irrevocable.

 

Section 11.5          Deposit of Redemption Price .

 

Prior to 10:00 a.m., New York City time on the Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 10.3) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date.

 

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Section 11.6          Securities Payable on Redemption Date .

 

Notice of redemption having been given in accordance with this Indenture, the Securities to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price specified in the notice, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with such notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided , however , that, unless otherwise specified as contemplated by Section 3.1, installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 3.7.

 

If any Security called for redemption shall not be so paid upon surrender for redemption, the principal and any premium shall, until paid, bear interest from the Redemption Date at the rate prescribed in the Security.

 

Section 11.7          Securities Redeemed in Part .

 

Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series and of like tenor, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

 

Article XII

Sinking Funds

 

Section 12.1          Applicability of Article .

 

The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 3.1 for Securities of such series.

 

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is referred to in this Indenture as a “mandatory sinking fund payment”, and any payment in excess of such minimum amount provided for by the terms of Securities of any series is referred to in this Indenture as an “optional sinking fund payment”. If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 12.2. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.

 

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Section 12.2          Satisfaction of Sinking Fund Payments with Securities .

 

The Company (1) may deliver Securities of a series (other than any previously called for redemption) and (2) may apply as a credit Securities of a series which previously have been redeemed by the Company either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, or have been otherwise acquired by the Company as permitted by such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.

 

Section 12.3          Redemption of Securities for Sinking Fund .

 

Not less than 90 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion, if any, which is to be satisfied by payment of cash and the portion, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant to Section 12.2 and the basis for such credit and will also deliver to the Trustee any Securities to be so delivered. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 11.3 and cause notice of redemption to be given in the name of and at the expense of the Company in the manner provided in Section 11.4. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 11.6 and 11.7.

 

Article XIII

Defeasance and Covenant Defeasance

 

Section 13.1          Applicability of Article; Company’s Option to Effect Defeasance or Covenant Defeasance .

 

If, pursuant to Section 3.1, provision is made for either or both of (a) Defeasance of the Securities of a series under Section 13.2 or (b) Covenant Defeasance of the Securities of a series under Section 13.3, then the provisions of such Section or Sections, as the case may be, together with the other provisions of this Article XIII, shall be applicable to the Securities of such series, and the Company may at its option by Board Resolution or in any other manner specified as contemplated by Section 3.1, at any time, with respect to the Securities of such series, elect to have either Section 13.2 (if applicable) or Section 13.3 (if applicable) be applied to the Outstanding Securities of such series upon compliance with the conditions set forth below in this Article XIII.

 

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Section 13.2          Defeasance and Discharge .

 

Upon the Company’s exercise of the above option applicable to this Section, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series on and after the date the conditions precedent set forth in Section 13.3 are satisfied (“Defeasance”). For this purpose, such Defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the Outstanding Securities of such series and to have satisfied all its other obligations under such Securities and this Indenture, insofar as such Securities are concerned (and the Trustee, upon Company Order and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged under this Indenture: (A) the rights of Holders of Outstanding Securities of such series to receive, solely from the trust fund described in Section 13.4 as more fully set forth in such Section, payments of the principal of (any premium, if any) and interest on such Securities when such payments are due, (B) the Company’s obligations with respect to such Securities under Sections 3.4, 3.5, 3.6, 6.7, 10.2, and 10.3, and any ancillary obligations, (C) the rights, powers, trusts, duties, immunities, and other provisions in respect of the Trustee under this Indenture, and (D) this Article XIII. Subject to compliance with this Article XIII, the Company may exercise its option under this Section 13.2 notwithstanding the prior exercise of its option under Section 13.3 with respect to the Securities of such series. Following a Defeasance, payment of the Securities of such series may not be accelerated because of an Event of Default.

 

Section 13.3          Covenant Defeasance .

 

Upon the Company’s exercise of the above option applicable to this Section and after the date the conditions set forth below are satisfied (“Covenant Defeasance”), (1) the Company shall be released from its obligations under any covenant applicable to such Securities that is determined pursuant to Section 3.1 to be subject to this provision, and (2) the occurrence of any event specified in Section 5.1(5) or 5.1(6) solely with respect to Significant Subsidiaries, Section 5.1(7) or determined pursuant to Section 3.1 to be subject to this provision shall not be deemed to be or result in an Event of Default. For this purpose, such Covenant Defeasance means that, with respect to the Outstanding Securities of such series, the Company may omit to comply with and shall have no liability in respect of any term, condition, or limitation set forth in any such Section whether directly or indirectly by reason of any reference elsewhere in this Indenture to any such Section or by reason of any reference in any such Section to any other provision in this Indenture or in any other document, but the remainder of this Indenture and such Securities shall be unaffected by such Covenant Defeasance.

 

Section 13.4          Conditions to Defeasance or Covenant Defeasance .

 

The following shall be the conditions precedent to application of either Section 13.2 or Section 13.3 to the Outstanding Securities of such series:

 

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(1)         The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee which satisfies the requirements contemplated by Section 6.9 and agrees to comply with the provisions of the Indenture applicable to it as if it were the Trustee under this Indenture), as trust funds in trust for the purpose of making the following payments, and dedicated solely to, the benefit of the Holders of such Securities, (A) money in an amount, or (B) U.S. Government Obligations which through the scheduled payment of principal and interest in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination of such money and U.S. Government Obligations, in each case sufficient, without reinvestment, in the opinion of a nationally recognized firm of independent public accountants or investment bankers expressed in a written certification delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee as previously provided) to pay and discharge, the principal of (and premium, if any) and interest on the Outstanding Securities of such series on the Maturity of such principal, any premium or interest, and any mandatory sinking fund payments or analogous payments applicable to the Outstanding Securities of such series on their due dates. Before such a deposit, the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date or dates in accordance with Article XI, which shall be given effect in applying the foregoing provisions. For this purpose, “U.S. Government Obligations” means securities that are (x) direct obligations of the United States of America for the payment of which its full faith and credit is pledged, or (y) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended), which may include the Trustee, as custodian with respect to any such U.S. Government Obligation or a specific payment of principal of or interest on any such U.S. Government Obligation held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal of or interest on the U.S. Government Obligation evidenced by such depository receipt.

 

(2)         No Event of Default or event which with notice or lapse of time or both would become an Event of Default with respect to the Securities of such series shall have occurred and be continuing (A) on the date of such deposit or (B) insofar as subsections 5.1(1) and (2) are concerned, at any time during the period ending on the 120th day after the date of such deposit or, if longer, ending on the day following the expiration of the preference period applicable to the Company under federal law in respect of such deposit (it being understood that the condition in this clause (B) shall not be deemed satisfied until the expiration of such period).

 

(3)         Such Defeasance or Covenant Defeasance shall not (A) cause the Trustee in respect of the Securities of such series to have a conflicting interest as defined in Section 6.8 or for purposes of the Trust Indenture Act with respect to any Securities of the Company or (B) result in the trust arising from such deposit to constitute, unless it is qualified as, a regulated investment company under the Investment Company Act of 1940, as amended.

 

(4)         Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or by which it is bound.

 

(5)         Such Defeasance or Covenant Defeasance shall not cause any Securities of such series then listed on any registered national securities exchange under the Securities Exchange Act of 1934, as amended, to be delisted.

 

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(6)         In the case of an election under Section 13.2, the Company shall have delivered to the Trustee an Opinion of Counsel stating that (x) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (y) since the date of this Indenture there has been a change in the applicable federal income tax law, in either case to the effect that, and based on such ruling or change such opinion shall confirm that, the Holders of the Outstanding Securities of such series will not recognize income, gain, or loss for federal income tax purposes as a result of such Defeasance and will be subject to federal income tax on the same amounts, in the same manner, and at the same times as would have been the case if such Defeasance had not occurred.

 

(7)         In the case of an election under Section 13.3, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize income, gain, or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner, and at the same times as would have been the case if such Covenant Defeasance had not occurred.

 

(8)         The Company shall have delivered to the Trustee an Opinion of Counsel to the effect that (subject to customary qualifications and assumptions) after the period described in Section 13.4(2), the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization, or similar laws affecting creditors’ rights generally.

 

(9)         Such Defeasance or Covenant Defeasance shall be effected in compliance with any additional terms, conditions, or limitations which may be imposed on the Company in connection with such Defeasance or Covenant Defeasance pursuant to Section 3.1.

 

(10)        The Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this Indenture relating to either the Defeasance under Section 13.2 or the Covenant Defeasance under Section 13.3 (as the case may be) have been complied with.

 

Section 13.5          Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions .

 

Subject to the provisions of the last paragraph of Section 10.3, all money and U.S. Government Obligations (including any proceeds) deposited with the Trustee or other qualifying trustee (solely for purposes of this Section and Section 13.6, the Trustee and any such other qualifying trustee are referred to collectively as the “Trustee”) pursuant to Section 13.4 in respect of the Outstanding Securities of such series shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any Paying Agent (but not including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of such Securities, of all sums due and to become due on such Securities in respect of principal (and premium, if any) and interest, but such money need not be segregated from other funds except to the extent required by law.

 

The Company shall pay and indemnify the Trustee against any tax, fee, or other charge imposed on or assessed against the money or U.S. Government Obligations deposited pursuant to Section 13.4 or the principal and interest received in respect of such money or U.S. Government Obligations other than any such tax, fee, or other charge which by law is for the account of the Holders of Outstanding Securities.

 

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Anything in this Indenture to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or U.S. Government Obligations held by it as provided in Section 13.4 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification delivered to the Trustee, are in excess of the amount which would then be required to be deposited to effect an equivalent Defeasance or Covenant Defeasance.

 

Section 13.6          Reinstatement .

 

If the Trustee or the Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 13.5 by reason of any order or judgment of any court or governmental authority enjoining, restraining, or otherwise prohibiting such application, then the Company’s obligations under the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this Article XIII until such time as the Trustee or Paying Agent is permitted to apply all such money and U.S. Government Obligations in accordance with Section 13.5; provided , however , that if the Company makes any payment of principal of (and premium, if any) or interest on any such Security following the reinstatement of its obligations, the Company shall be entitled, at its election, (a) to receive from the Trustee or Paying Agent, as applicable, that portion of such money or U.S. Government Obligations held by the Trustee or the Paying Agent, as applicable, equal to the amount of such payment, or (b) to be subrogated to the rights of the Holders of such Securities to receive such payment from the money and U.S. Government Obligations held by the Trustee or the Paying Agent.

 

Article XIV

Subordination Of Securities

 

Section 14.1          Securities Subordinate to Senior Debt .

 

The Company covenants and agrees that anything in this Indenture or the Securities of any series to the contrary notwithstanding, the indebtedness evidenced by the Securities of each series is subordinate and junior in right of payment to all Senior Debt to the extent provided in this Indenture, and each Holder of Securities of each series, by such Holder’s acceptance of such Securities, likewise covenants and agrees to the subordination provided in this Indenture and shall be bound by the provisions of this Indenture. Senior Debt shall continue to be Senior Debt and entitled to the benefits of these subordination provisions irrespective of any amendment, modification, or waiver of any term of the Senior Debt or extension or renewal of the Senior Debt.

 

In the event of

 

(a)          any insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment, composition, or other similar proceeding relating to the Company or its property,

 

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(b)          any proceeding for the liquidation, dissolution, or other winding up of the Company, voluntary or involuntary, whether or not involving insolvency or bankruptcy proceedings,

 

(c)          any assignment by the Company for the benefit of creditors, or

 

(d)          any other marshaling of the assets of the Company,

 

all Senior Debt (including any interest on such Senior Debt accruing after the commencement of any such proceedings) shall first be paid in full before any payment or distribution, whether in cash, securities, or other property, shall be made to any Holder of any of the Securities on account of such Securities. Any payment or distribution, whether in cash, securities, or other property (other than securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in these subordination provisions with respect to the indebtedness evidenced by the Securities, to the payment of all Senior Debt at the time outstanding and to any securities issued in respect of such Senior Debt under any such plan of reorganization or readjustment), which would otherwise (but for these subordination provisions) be payable or deliverable in respect of the Securities of any series shall be paid or delivered directly to the holders of Senior Debt in accordance with the priorities then existing among such holders until all Senior Debt (including any interest on such Senior Debt accruing after the commencement of any such proceedings) shall have been paid in full. In the event of any such proceeding, after payment in full of all sums owing with respect to Senior Debt, the Holders of the Securities, together with the holders of any obligations of the Company ranking on a parity with the Securities, shall be entitled to be paid from the remaining assets of the Company the amounts at the time due and owing on account of unpaid principal of (and premium, if any) and interest on the Securities and such other obligations before any payment or other distribution, whether in cash, property, or otherwise, shall be made on account of any capital stock or any obligations of the Company ranking junior to the Securities and such other obligations. The rights of holders of Senior Debt under this Section do not extend to any payment or distribution, whether in cash, securities or other property, to the extent applied to the Trustee’s rights to compensation, reimbursement of expenses or indemnification.

 

In the event that, notwithstanding the foregoing, any payment or distribution of any character or any security, whether in cash, securities, or other property (other than securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in these subordination provisions with respect to the indebtedness evidenced by the Securities, to the payment of all Senior Debt at the time outstanding and to any securities issued in respect of such Senior Debt under any such plan of reorganization or readjustment), shall be received by the Trustee or any Holder in contravention of any of the terms of this Indenture such payment or distribution or security shall be received in trust for the benefit of, and shall be paid over or delivered and transferred to, the holders of the Senior Debt at the time outstanding in accordance with the priorities then existing among such holders for applications to the payment of all Senior Debt remaining unpaid to the extent necessary to pay all such Senior Debt in full. In the event of the failure of the Trustee or any Holder to endorse or assign any such payment, distribution, or security, each holder of Senior Debt is irrevocably authorized to endorse or assign the same.

 

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No present or future holder of any Senior Debt shall be prejudiced in the right to enforce subordination of the indebtedness evidenced by the Securities by any act or failure to act on the part of the Company. Nothing contained in this Indenture shall impair, as between the Company and the Holders of Securities of each series, the obligation of the Company to pay to such Holders the principal of (and premium, if any) and interest on such Securities or prevent the Trustee or the Holder from exercising all rights, powers and remedies otherwise permitted by applicable law or under this Indenture upon a default or Event of Default, all subject to the rights of the holders of the Senior Debt to receive cash, securities, or other property otherwise payable or deliverable to the Holders.

 

Senior Debt shall not be deemed to have been paid in full unless the holders thereof shall have received cash, securities, or other property equal to the amount of such Senior Debt then outstanding. Upon the payment in full of all Senior Debt, the Holders of Securities of each series shall be subrogated to all rights of any holders of Senior Debt to receive any further payments or distributions applicable to the Senior Debt until the indebtedness evidenced by the Securities of such series shall have been paid in full, and such payments or distributions received by such Holders, by reason of such subrogation, of cash, securities, or other property which otherwise would be paid or distributed to the holders of Senior Debt shall, as between the Company and its creditors other than the holders of Senior Debt, on the one hand, and such Holders, on the other hand, be deemed to be a payment by the Company on account of Senior Debt, and not on account of the Securities of such series.

 

Notwithstanding the foregoing or anything else in this Article XIV contained, at any time after the 123rd day following the date of deposit of money and U.S. Government Obligations pursuant to Article IV or XIII (provided all conditions set out in the applicable Article shall have been satisfied), the funds (including U.S. Government Obligations) so deposited and any interest thereon will not be subject to any rights of holders of Senior Debt including, without limitation, those arising under this Article XIV; provided that no event described in clauses (1) and (2) of Section 5.1 has occurred during such 123-day period.

 

The provisions of this Section 14.1 shall not impair any rights, interests, remedies, or powers of any secured creditor of the Company in respect of any security interest the creation of which is not prohibited by the provisions of this Indenture.

 

Section 14.2          No Payment When Senior Debt in Default .

 

In the event and during the continuation of any default in the payment of the principal of or any premium or interest on any Senior Debt beyond any applicable grace period with respect to such Senior Debt, or in the event that any event of default with respect to any Senior Debt shall have occurred and be continuing permitting the holders of such Senior Debt (or the trustee on behalf of the holders of such Senior Debt) to declare such Senior Debt due and payable prior to the date on which it would otherwise have become due and payable, unless and until such event of default shall have been cured or waived or shall have ceased to exist and any such declaration and its consequences shall have been rescinded or annulled, or (b) in the event any judicial proceeding shall be pending with respect to any such default in payment or event of default, then no payment (including any payment which may be payable by reason of the payment of any other indebtedness of the Company being subordinated to the payment of the Securities) shall be made by the Company on account of the principal of or any premium or interest on the Securities or on account of the purchase or other acquisition of Securities, provided , however , that nothing in this Section 14.2 shall prevent the satisfaction of any sinking fund payment in accordance with Article XII by delivering and crediting pursuant to Section 12.2 Securities which have been acquired (upon redemption or otherwise) prior to such default in payment or event of default.

 

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Subject to Section 14.5, in the event that, notwithstanding the foregoing, the Company shall make any payment to the Trustee or the Holder of any Security prohibited by the foregoing provisions of this Section 14.2, and if such fact shall, at or prior to the time of such payment, have been made known in a writing delivered to a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee by a holder of Senior Debt or the Company or, as the case may be, such Holder, then and in such event such payment shall be paid over and delivered to the Company.

 

The provisions of this Section 14.2 shall not apply to any payment with respect to which Section 14.1 would be applicable.

 

Section 14.3          Trustee and Holders of Securities May Rely on Certificate of Liquidating Agent; Trustee May Require Further Evidence as to Ownership of Senior Debt; Trustee Not Fiduciary to Holders of Senior Debt .

 

Upon any payment or distribution of assets of the Company referred to in this Article XIV, the Trustee and the Holders shall be entitled to conclusively rely upon an order or decree made by any court of competent jurisdiction in which such dissolution or winding up or liquidation or reorganization or arrangement proceedings are pending or upon a certificate of the trustee in bankruptcy, receiver, assignee for the benefit of creditors, or other Person making such payment or distribution, delivered to the Trustee or to the Holders, for the purpose of ascertaining the Persons entitled to participate in such distribution, the holders of the Senior Debt and other indebtedness of the Company, the amount of or payable on and the amount or amounts paid or distributed on such Senior Debt or other indebtedness, and all other facts pertinent to such Senior Debt or other indebtedness or to this Article XIV. In the absence of any such bankruptcy trustee, receiver, assignee, or other Person, the Trustee shall be entitled to conclusively rely upon a written notice by a Person representing itself, himself or herself to be a holder of Senior Debt (or a trustee or representative on behalf of such holder) as evidence that such Person is a holder of such Senior Debt (or is such a trustee or representative), the amount of or payable on and the amount or amounts paid or distributed on such Senior Debt or other indebtedness, and all other facts pertinent to such Senior Debt or other indebtedness. In the event that the Trustee determines, in good faith, that further evidence is required with respect to the right of any Person as a holder of Senior Debt to participate in any payments or distributions pursuant to this Article XIV, the Trustee may request such person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Debt held by such Person, as to the extent to which such Person is entitled to participate in such payment or distribution, and as to other facts pertinent to the rights of such Person under this Article XIV, and if such evidence is not furnished, the Trustee may withhold any payment to such Person pending judicial determination as to the right of such Person to receive payment. The Trustee, however, shall not be deemed to owe any fiduciary duty to the holders of Senior Debt, and shall not be liable to any such holders if it shall pay over or deliver to the Holders or the Company or any other Person, cash, securities, or other property to which any holders of Senior Debt shall be entitled by virtue of this Article or otherwise. With respect to the holders of Senior Debt, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations with respect to the holders of Senior Debt shall be read into this Indenture against the Trustee.

 

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Section 14.4          Payment Permitted If No Default .

 

Nothing contained in this Article XIV (except in Section 14.5) or elsewhere in this Indenture, or in any of the Securities, shall prevent (a) the Company at any time, except during the pendency of any dissolution, winding up, liquidation, or reorganization proceedings referred to in Section 14.1 or under the conditions specified in Section 14.2, from making payments of the principal of (or premium, if any) or interest on the Securities or (b) the application by the Trustee or any Paying Agent of any moneys deposited with it under this Indenture to payments of the principal of or interest on the Securities, if, at the time of such deposit, a Responsible Officer of the Trustee or such Paying Agent, as the case may be, had not received at the Corporate Trust Office of the Trustee the Officers’ Certificate or written notice provided for in Section 14.5 of any event prohibiting the making of such deposit, or if, at the time of such deposit (whether or not in trust) by the Company with the Trustee or any Paying Agent (other than the Company) such payment would not have been prohibited by the provisions of this Article, and the Trustee or any Paying Agent shall not be affected by any notice to the contrary received by it on or after such date.

 

Section 14.5          Trustee Not Charged with Knowledge of Prohibition .

 

Anything in this Article XIV or elsewhere contained in this Indenture to the contrary notwithstanding, the Trustee shall not at any time be charged with knowledge of the existence of any facts which would prohibit the making of any payment of moneys to or by the Trustee, and shall be entitled conclusively to assume that no such facts exist and that no event specified in Section 14.1 or Section 14.2 has happened, unless and until a Responsible Officer of the Trustee shall have received at the Corporate Trust Office of the Trustee (i) an Officers’ Certificate to that effect or (ii) notice in writing to that effect signed by or on behalf of the holder or holders, or their representatives, of Senior Debt who shall have been certified by the Company or otherwise established to the reasonable satisfaction of the Trustee to be such holder or holders or representatives or from any trustee under any indenture pursuant to which such Senior Debt shall be outstanding; and before the receipt of any such Officers’ Certificate or written notice, the Trustee shall be entitled in all respects to assume that no such facts exist; provided, however, that if the Trustee shall not have received the Officers’ Certificate or the written notice provided for in this Section at least three (3) Business Days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of or interest on any Security) then, anything herein contained to the contrary notwithstanding, the Trustee shall have all power and authority to receive such money and to apply the same to the purpose for which such money were received and shall not be affected by any notice to the contrary which may be received by it during or after such three (3) Business Day period.

 

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The Company shall give prompt written notice to the Trustee and to the Paying Agent of any facts which would prohibit the payment of money or assets to or by the Trustee or any Paying Agent.

 

Section 14.6          Trustee to Effectuate Subordination .

 

Each Holder of Securities by such Holder’s acceptance thereof authorizes and directs the Trustee on such Holder’s behalf to take such action as may be necessary or appropriate to effectuate the subordination as between such Holder and holders of Senior Debt as provided in this Article and appoints the Trustee its attorney-in-fact for any and all such purposes.

 

Section 14.7          Rights of Trustee as Holder of Senior Debt .

 

The Trustee shall be entitled to all the rights set forth in this Article with respect to any Senior Debt which may at the time be held by it, to the same extent as any other holder of Senior Debt. Nothing in this Article shall deprive the Trustee of any rights as such holder.

 

Section 14.8          Article Applicable to Paying Agents .

 

In case at any time any Paying Agent other than the Trustee shall have been appointed by the Company and be then acting under this Indenture, the term “Trustee” as used in this Article shall in such case (unless the context shall otherwise require) be construed as extending to and including such Paying Agent within its meaning as fully for all intents and purposes as if the Paying Agent were named in this Article in addition to or in place of the Trustee, provided, however, that Sections 14.5 and 14.7 shall not apply to the Company or any Affiliate of the Company if the Company or such Affiliate acts as Paying Agent.

 

Section 14.9          Subordination Rights Not Impaired by Acts or Omissions of the Company or Holders of Senior Debt .

 

No right of any present or future holders of any Senior Debt to enforce subordination as provided in this Indenture shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions, and covenants of this Indenture, regardless of any knowledge which any such holder may have or be otherwise charged with. The holders of Senior Debt may, at any time or from time to time and in their absolute discretion, change the manner, place, or terms of payment, change or extend the time of payment of, or renew or alter, any such Senior Debt, or amend or supplement any instrument pursuant to which any such Senior Debt is issued or by which it may be secured, or release any security, or exercise or refrain from exercising any other of their rights under the Senior Debt including, without limitation, the waiver of default, all without notice to or assent from the Holders of the Securities or the Trustee and without affecting the obligations of the Company, the Trustee, or the Holders of the Securities under this Article.

 

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Section 14.10          Trustee’s Rights to Compensation, Reimbursement of Expenses and Indemnification .

 

Nothing in this Article shall apply to claims of, or payments to, the Trustee under or pursuant to Sections 5.6 or 6.7.

 

Section 14.11          Modification of Subordination Provisions .

 

Anything in Article IX or elsewhere contained in this Indenture to the contrary notwithstanding, no modification or amendment and no supplemental indenture shall modify the subordination provisions of this Article XIV in a manner that would adversely affect the holders of Senior Debt.

 

This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. The exchange of copies of this Indenture and of signature pages by facsimile or electronic format ( i.e. , “pdf” or “tif”) transmission shall constitute effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronic format ( i.e. , “pdf” or “tif”) shall be deemed to be their original signatures for all purposes.

 

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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the day and year first above written.

 

  INTERNATIONAL SEAWAYS, INC.
     
  By:  
    Name:
    Title:
     
  THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
     
  By:  
    Name:
    Title:

 

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Exhibit 10.21

 

Execution Form

Dated 29 March 2018
TI AFRICA LIMITED
TI ASIA LIMITED
as joint and several Borrowers
and
THE BANKS AND FINANCIAL INSTITUTIONS
LISTED IN PART A OF SCHEDULE 1
as Lenders
and
ABN AMRO BANK N.V.
ING BELGIUM SA/NV
as Mandated Lead Arrangers
and
THE BANKS AND FINANCIAL INSTITUTIONS
LISTED IN PART B OF SCHEDULE 1
as Swap Banks
and
ING BANK N.V.
as Agent
and as Security Trustee

LOAN AGREEMENT
relating to
a loan facility of up to US$220,000,000 to refinance
"FSO ASIA" and "FSO AFRICA"





Index

Clause Page
     
1 Interpretation 1
2 Facility 27
3 Position of the Lenders and Swap Banks 28
4 Drawdown 29
5 Interest 30
6 Interest Periods 34
7 Default interest 35
8 Repayment, Prepayment and cancellation 36
9 Conditions Precedent 41
10 Representations and Warranties 42
11 General Undertakings 46
12 Corporate Undertakings 51
13 Insurance 53
14 FSO Covenants 58
15 Payments and Calculations 62
16 Application of Receipts 64
17 Application of Earnings 66
18 Events of Default 66
19 Fees and Expenses 72
20 Indemnities 73
21 No Set-Off or Tax Deduction 76
22 The Agent, the Mandated Lead Arrangers and the Reference Banks 79
23 The Security Trustee 89
24 Conduct of Business by the Creditor Parties 103
25 Sharing among the Creditor Parties 103
26 Illegality, etc 105
27 increased Costs 106
28 Set-Off 108
29 Transfers and Changes in Lending Offices 108
30 Confidential Information 112
31 Confidentiality of Funding Rates and Reference Bank Quotations 116
32 Variations and Waivers 118
33 Notices 119
34 Joint and Several Liability 122
35 Supplemental 123
36 Law and Jurisdiction 124

 

Schedules

 

Schedule 1 126
Part A Lenders and Commitments 126
Part B Swap Banks 127
Schedule 2 Term Facility Repayment Instalments 128
Schedule 3 Reduction amounts 129
Schedule 4 Drawdown Notice 130
Schedule 5 Condition Precedent Documents 131
Part A 131
Part B 132
Schedule 6 Transfer Certificate 134
Schedule 7 Designation Notice 138
Schedule 8 Timetables 139
Schedule 9 Form of Compliance Certificate 140
Schedule 10 Form of Budget 142


Execution
 
Execution Pages 142

        



 
THIS AGREEMENT is made on 29 March 2018
PARTIES
(1)
TI AFRICA LIMITED and TI ASIA LIMITED , as joint and several Borrowers
(2)
THE BANKS AND FINANCIAL INSTITUTIONS listed in Part A of Schedule 1, as Lenders
(3)
ABN AMRO BANK N.V. and ING BANK BELGIUM SA/NV as Mandated Lead Arrangers
(4)
THE BANKS AND FINANCIAL INSTITUTIONS listed in Part B of Schedule 1, as Swap Banks
(5)
ING BANK N.V. , as Agent
(6)
ING BANK N.V. , as Security Trustee
BACKGROUND
(A)
The Lenders have agreed to make available to the Borrowers facilities of up to $220,000,000 comprising:
(i)
Tranche A of the Term Loan in a principal amount not exceeding $54,000,000 to be provided to TI Asia for general corporate purposes;
(ii)
Tranche B of the Term Loan in a principal amount not exceeding $56,000,000 to be provided to TI Africa for general corporate purposes;
(iii)
Revolving Facility A in a principal amount not exceeding $54,000,000 to be provided to TI Asia for general corporate purposes; and
(iv)
Revolving Facility B in a principal amount not exceeding $56,000,000 to be provided to TI Africa for general corporate purposes.
(B)
The Swap Banks may agree to enter into interest rate swap transactions with the Borrowers from time to time to hedge the Borrowers' exposure under this Agreement to interest rate fluctuations.
(C)
The Lenders and the Swap Banks have agreed to share in the security to be granted to the Security Trustee pursuant to this Agreement on the terms described herein.
It is agreed as follows:
OPERATIVE PROVISIONS
1
INTERPRETATION
1.1
Definitions
Subject to Clause 1.5 ( General Interpretation ), in this Agreement:
" Accounts Security Deed " means, in respect of a Borrower, a deed creating security in respect of the Earnings Account of that Borrower to be made between that Borrower and the Security Trustee in Agreed Form.






" Advance " means the principal amount of each borrowing by the Borrowers under this Agreement.
" Affiliate " means, in relation to any person, a subsidiary of that person or a Holding Company of that person or any other subsidiary of that Holding Company.
" Agent " means ING Bank N.V., acting in such capacity through its office at Bijlmerplein 888,1102 MG, Amsterdam, The Netherlands, or any successor of it.
" Agreed Form " means in relation to any Finance Document, that document in the form approved in writing by the Agent (acting on the instructions of all the Lenders) or as otherwise approved in accordance with any other approval procedure specified in any relevant provisions of any Finance Document, and in relation to any other document, that document in the form approved in writing by the Agent.
" Anti-Corruption Laws " means the England and Wales Bribery Act 2010, the United States Foreign Corrupt Practices Act 1977 or other similar anti-corruption legislation in any other applicable jurisdictions.
" Approved Flag " means, for each FSO, Marshall Islands flag or any other flag approved by the Agent (acting on the instructions of the Lenders), such approval not to be unreasonably withheld or delayed.
" Approved Manager " means Euronav Shipmanagement SAS of De Gerlachekaai 20, B 2000 Antwerp 1, Belgium or, in each case:
(a)
any other company appointed by the relevant Borrower as the manager of an FSO in accordance with paragraph (b) of Clause 14.12 ( Restrictions on chartering, appointment of managers etc. ); or
(b)
any other company which the Agent may, with the authorisation of the Majority Lenders, approve from time to time as the technical manager of that FSO, such approval not to be unreasonably withheld or delayed and which authorisation shall not be withheld in the case of International Seaways or any Affiliate of it.
" Approved Valuer " means Fearnleys (or any Affiliate of such person through which valuations are commonly issued) and any other firm or firms of independent sale and purchase shipbrokers approved in writing by the Facility Agent, acting with the authorisation of the Lenders, such approval not to be unreasonably withheld.
" Arrangers " means each of the Mandated Lead Arrangers.
" Available Commitment " means, in relation to a Tranche or a Revolving Facility, a Lender's Commitment under that Tranche or Revolving Facility minus:
(a)
the amount of its participation in the outstanding Advances under that Tranche or Revolving Facility; and
(b)
in relation to any proposed Advance, the amount of its participation in any other Advance that is due to be made under that Tranche or Revolving Facility on or before the proposed Drawdown Date.
For the purposes of calculating a Lender's Available Commitment in relation to any proposed Advance under a Revolving Facility only, that Lender's participation in any Advance under that

2     



Revolving Facility that is due to be repaid or prepaid on or before the proposed Drawdown Date shall not be deducted from that Lender's relevant Revolving Commitment.
" Available Facility " means, in relation to a Tranche or a Revolving Facility, the aggregate for the time being of each Lender's Available Commitment in respect of that Tranche or Revolving Facility.
" Available Revolving Facility A Commitment " means, in relation to a Lender and at any time, its Revolving Facility A Commitment less its Contribution in respect of Revolving Facility A at that time (and " Total Available Revolving Facility A Commitments " means the aggregate of the Available Revolving Facility A Commitments of all the Lenders).
" Available Revolving Facility B Commitment " means, in relation to a Lender and at any time, its Revolving Facility B Commitment less its Contribution in respect of Revolving Facility B at that time (and " Total Available Revolving Facility B Commitments " means the aggregate of the Available Revolving Facility B Commitments of all the Lenders).
" Available Revolving Facility Commitment " means the Available Revolving Facility A Commitment or Available Revolving Facility B Commitment.
" Availability Period " means the period from and including the date of this Agreement to and including:
(a)
in relation to the Term Facility, 30 April 2018; and
(b)
in relation a Revolving Facility, the date falling 3 months before the Maturity Date in respect of that Revolving Facility.
" Bail-In Action " means the exercise of any Write-down and Conversion Powers.
" Bail-In Legislation " means:
(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.
" Bank Guarantor " means ING Belgium SA/NV, acting through its office at B-1000 Brussels, Avenue Marnix 24, 0403.200.393.
" 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;

3     



(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".
" Borrowers " means each of TI Africa and TI Asia.
" Business Day " means a day on which banks are open in London, Brussels, Hong Kong, New York City and Amsterdam.
" Change in Ultimate Beneficial Owner " means in respect of a Borrower or Security Party other than the Guarantors any event by which a private individual (i) acquires the legal and/or beneficial ownership (directly or indirectly) of 25 per cent. or more of the issued share capital of that Borrower or Security Party or (ii) acquires the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to (directly or indirectly) cast, or control the casting of, 25 per cent. or more of the votes that might be cast at a general meeting of that Borrower or Security Party or (iii) gains effective control over that Borrower or Security Party (such private individual being referred to as the "Ultimate Beneficial Owner").
" Change of Control " means:
(a)
in the case of Euronav, if 2 or more persons acting in concert or any individual person other than Saverco nv:
(i)
acquires legally and/or beneficially, and either directly or indirectly, in excess of 50 per cent. of the issued share capital of Euronav; or
(ii)
has the right or the ability to control, either directly or indirectly, the affairs or composition of the majority of the board of directors (or equivalent) of Euronav; and
(b)
in the case of International Seaways:
(i)
any "person" (as such term is used in Sections 13(d) and 14(d) of the US Securities Exchange Act of 1934, as amended (the " Exchange Act ")) is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this Clause (i) such person shall be deemed to have "beneficial ownership" of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50 per cent. of the total voting power of International Seaways' voting stock; or
(ii)
the replacement of a majority of the board of directors of International Seaways over a 2 year period who constituted the board of directors of International Seaways at the beginning of such period, and such replacement shall not have been approved by a vote of at least a majority of the board of directors of International Seaways in office as of the date of such replacement who either were members of such board of directors at the beginning of such period or whose election as members of such board of directors was previously so approved.

4     



" Code " means the US Internal Revenue Code of 1986, as amended.
" Commitment " means a Term Commitment or a Revolving Commitment.
" Compliance Certificate " means a certificate in the form set out in Schedule 9 ( Form of Compliance Certificate ) or in any other form agreed between the Borrowers and the Facility Agent.
" Confidential Information " means all information relating to either Borrower, either Group, the Finance Documents or the Loan of which a Creditor Party becomes aware in its capacity as, or for the purpose of becoming, a Creditor Party or which is received by a Creditor Party in relation to, or for the purpose of becoming a Creditor Party under, the Finance Documents or the Loan from either:
(a)
any member of either Group or any of its advisers; or
(b)
another Creditor Party, if the information was obtained by that Creditor Party directly or indirectly from any member of either Group or any of its advisers,
in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes:
(i)
information that
(A)
is or becomes public information other than as a direct or indirect result of any breach by that Creditor Party of Clause 30.2 ( Disclosure of 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 Creditor Party before the date the information is disclosed to it in accordance with paragraphs (a) or (b) above or is lawfully obtained by that Creditor Party after that date, from a source which is, as far as that Creditor Party is aware, unconnected with the Group and which, in either case, as far as that Creditor 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.
" Confidentiality Undertaking " means a confidentiality undertaking in substantially the appropriate form recommended by the Loan Market Association (or any successor organisation) from time to time (as logically amended to reflect the terms of this Agreement) or in any other form agreed between the Borrower and the Agent.
" Confirmation " and " Early Termination Date ", in relation to any continuing Designated Transaction, have the meaning given in the relevant Master Agreement.
" Contractual Currency " has the meaning given in Clause 20.4 ( Currency indemnity ).
" Contribution " means, in relation to a Lender, the part of the Loan which is owing to that Lender.

5     



" Co-ordination Deed " means the co-ordination deed to be entered into between the Borrowers, the Agent on behalf of the Lenders and the Bank Guarantor to regulate the relationship between the Lenders, the Bank Guarantor and the Borrowers and access to the security which will secure the obligations of the Borrowers under this Agreement as set forth in the Finance Documents and the obligations of the Borrowers under the Guarantee Facility.
" Corresponding Debt " means any amount, other than any Parallel Debt, which a Borrower owes to a Creditor Party under or in connection with the Finance Documents or the Master Agreements.
" 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.
" Creditor Party " means the Agent, the Security Trustee, the Arrangers, any Lender or any Swap Bank, whether as at the date of this Agreement or at any later time.
" Debt Service Cover Ratio " means, in respect of a Borrower, the ratio of (i) that Borrower's EBITDA to (ii) the aggregate of any net interest cost, guarantee commission and instalments payable by that Borrower each measured over the preceding four financial quarters.
" Default " means an Event of Default or a Potential Event of Default.
" Designated Transaction " means a Transaction which fulfils the following requirements:
(a)
it is entered into by the Borrowers pursuant to a Master Agreement with a Swap Bank and the Borrowers' rights under such Master Agreement are subject to a Master Agreement Assignment;
(b)
its purpose is the hedging of the Borrowers' exposure under this Agreement to fluctuations in LIBOR arising from the funding of the Loan (or any part thereof) for a period expiring no later than the final Repayment Date; and
(c)
it is designated by the Borrowers and/or by the relevant Swap Bank, by delivery by the Borrowers and/or that Swap Bank to the Agent of a notice of designation in the form set out in Schedule 7 ( Designation Notice ), as a Designated Transaction for the purposes of the Finance Documents.
" Disruption Event " means either or both of:
(a)
a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facilities (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 Security Party; or

6     



(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 Security Party preventing that, or any other, Party or, if applicable, any Security Party:
(i)
from performing its payment obligations under the Finance Documents; or
(ii)
from communicating with other Parties or, if applicable, any Security Party in accordance with the terms of the Finance Documents,
and which (in either such case) is not caused by, and is beyond the control of, the Party or, if applicable, any Security Party whose operations are disrupted.
" Dividend Lock-Up Event " means any time where, as at the most recent fiscal quarter end date, the Debt Service Cover Ratio for the immediately preceding 4 fiscal quarters was less than 1.2x.
" Dollars " and " $ " means the lawful currency for the time being of the United States of America.
" Drawdown Date " means, in relation to an Advance, the date requested by the Borrowers for the Advance to be made, or (as the context requires) the date on which the Advance is actually made.
" Drawdown Notice " means a notice in the form set out in Schedule 4 ( Drawdown Notice ) (or in any other form which the Agent approves or reasonably requires).
" Earnings " means, in relation to a FSO, all moneys whatsoever which are now, or later become, payable (actually or contingently) to the Borrower owning that FSO or the Security Trustee and which arise out of the use or operation of that FSO during the Security Period, including (but not limited to):
(a)
all freight, hire and passage moneys and all amounts payable by NOC under the Service Contract for a FSO (including, for the avoidance of doubt, any termination fee or mobilisation/demobilisation fee);
(b)
compensation payable to any Borrower or the Security Trustee in the event of requisition of a FSO for hire;
(c)
remuneration for salvage and towage services;
(d)
demurrage and detention moneys;
(e)
damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of a FSO; and
(f)
all moneys which are at any time payable under any Insurances in respect of loss of hire.
" Earnings Account " means:
(a)
in relation "FSO ASIA", the account in the name of TI Asia with the Agent in Amsterdam having account number NL33 INGB 0020 1558 32;
(b)
in relation "FSO AFRICA", the account in the name of TI Africa with the Agent in Amsterdam having account number NL80 INGB 0020 1558 59,

7     



or, in either case, any other account (with that or another office of the Agent or with a bank or financial institution other than the Agent) which is designated by the Agent as the Earnings Account in relation to that FSO for the purposes of this Agreement.
" Environmental Claim " means:
(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,
and " claim " means a claim for damages, compensation, fines, penalties or any other payment of any kind whether or not similar to the foregoing; an order or direction to take, or not to take, certain action or to desist from or suspend certain action; and any form of enforcement or regulatory action, including the arrest or attachment of any asset.
" Environmental Incident " means:
(a)
any release of Environmentally Sensitive Material from a FSO; or
(b)
any incident in which Environmentally Sensitive Material is released from a vessel other than a FSO and which involves a collision between a FSO and such other vessel or some other incident of navigation or operation, in either case, in connection with which a FSO is actually or reasonably likely to be arrested, attached, detained or injuncted and/or a FSO and/or any Borrower and/or any operator or manager of a FSO is at fault or allegedly at fault or otherwise reasonably likely to be subject to any legal or administrative action; or
(c)
any other incident in which Environmentally Sensitive Material is released otherwise than from a FSO and in connection with which a FSO is actually or reasonably likely to be arrested and/or where any Borrower and/or any operator or manager of a FSO is at fault or allegedly at fault or reasonably likely to be subject to any legal or administrative action.
" Environmental Law " means any law relating to pollution or protection of the environment, to the carriage of Environmentally Sensitive Material or to actual or threatened releases of Environmentally Sensitive Material.
" Environmentally Sensitive Material " means oil, oil products and any other substance (including any chemical, gas or other hazardous or noxious substance) which is (or is capable of being or becoming) polluting, toxic or hazardous.
" EU Bail-In Legislation Schedule " means the document described as such and published by the Loan Market Association (or any successor organisation) from time to time.
" Euronav " means Euronav NV, a company incorporated in Belgium whose Belgium registered office is at De Gerlachekaai 20, B-2000 Antwerp 1, Belgium.
" Euronav Group " means Euronav and each of its subsidiaries.
" Event of Default " means any of the events or circumstances described in Clause 18.1 ( Events of Default ).

8     



" Facility " means the Term Facility or the Revolving Facility.
" Facility Cap " means, in relation to (i) Tranche A and Revolving Facility A; or (ii) Tranche B and Revolving Facility B, the amount that the Facility Agent, acting on the instructions of the Lenders, agrees as at the first Drawdown Date of the relevant Tranche could be repaid between the first Drawdown Date and the Maturity Date for the relevant Tranche and Revolving Facility:
(a)
using only Earnings under the relevant Service Contract less operating expenses, overheads and taxes; and
(b)
maintaining the relevant Borrower's Debt Service Cover Ratio at no less than 1.3x during that period.
" Facility Office " means the office or offices notified by a Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than 5 Business Days' written notice) as the office or offices through which it will perform its obligations under this Agreement.
" FATCA " means:
(a)
sections 1471 to 1474 of the Code or any associated regulations or other 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.
" FATCA Application Date " means:
(a)
in relation to a "withholdable payment" described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014;
(b)
in relation to a "withholdable payment" described in section 1473(1)(A)(ii) of the Code (which relates to "gross proceeds" from the disposition of property of a type that can produce interest from sources within the US), 1 January 2019; or
(c)
in relation to a "passthru payment" described in section 1471(d)(7) of the Code not falling within paragraphs (a) or (b) above, 1 January 2019,
or, in each case, such other date from which such payment may become subject to a deduction or withholding required by FATCA as a result of any change in FATCA after the date of this Agreement.
" FATCA Deduction " means a deduction or withholding from a payment under a Finance Document required by FATCA.
" FATCA Exempt Party " means a Party that is entitled to receive payments free from any FATCA Deduction.

9     



" Fee Letter " means any letter or letters dated on or about the date of this Agreement between any of the Arrangers, the Agent and the Security Trustee and any Borrower setting out any of the fees referred to in Clause 19 ( Fees and expenses ).
" Finance Documents " means:
(a)
this Agreement;
(b)
any Fee Letter;
(c)
the Guarantees;
(d)
the Mortgages;
(e)
the General Assignments;
(f)
the Service Contract Assignments;
(g)
the Accounts Security Deeds;
(h)
the Shares Security Deeds;
(i)
the Subordination Agreements;
(j)
the Co-ordination Deed;
(k)
the Master Agreement Assignments;
(l)
the Quiet Enjoyment Letters;
(m)
any other document (whether creating a Security Interest or not) which is executed at any time by any Borrower or any other person as security for, or to establish any form of subordination or priorities arrangement in relation to, any amount payable to the Lenders and/or the Swap Banks under this Agreement or any of the other documents to which this definition refers; and
(n)
any other document designated as such by the Agent and the Borrowers.
" Financial Indebtedness " means, in relation to a person (the " debtor "), a liability of the debtor:
(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 or dematerialised equivalent 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 foreign exchange transaction, 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

10     



(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 paragraphs (a) to (e) if the references to the debtor referred to the other person.
" FSO 1 " means the double hulled tanker type vessel of 432,023 dead weight tons named "FSO ASIA" which is registered in the ownership of TI Asia under the Marshall Islands flag with IMO number 9224752.
" FSO 2 " means the double hulled tanker type vessel of 432,023 dead weight tons named "FSO AFRICA" which is registered in the ownership of TI Africa under the Marshall Islands flag with IMO number 9224764.
" FSO 1 Service Contract " means the service contract dated 14 May 2017 for FSO 1 and having contract reference number 4600000114 entered into between TI Asia and NOC for service of FSO 1 in the Al Shaheen Field, Block 5, offshore Qatar for a period of 5 years.
" FSO 2 Service Contract " means the service contract dated 14 May 2017 for FSO 2 and having contract reference number 46000000113 entered into between TI Africa and NOC for service of FSO 2 in the Al Shaheen Field, Block 5, offshore Qatar for a period of 5 years.
" FSOs " means each of FSO 1 and FSO 2.
" Funding Rate " means any individual rate notified by a Lender to the Agent pursuant to sub-paragraph (ii) of paragraph (a) of Clause 5.10 ( Cost of funds ).
" GAAP " means generally accepted accounting principles applicable in jurisdiction of the relevant company.
" General Assignment " means, in relation to each FSO, the general assignment of Earnings, Insurances and any Requisition Compensation in relation to that FSO executed by the Borrower owning that FSO in favour of the Security Trustee in Agreed Form and to secure the obligations of the Borrowers under this Agreement and the Guarantee Facility.
" Group " means the Euronav Group or the International Seaways Group.
" Guarantee Facility" means the guarantee facility dated 14 July 2017 entered into between the Borrowers, the Guarantors and the Bank Guarantor in relation to the Performance Bond (as defined in each Service Contract and which shall not exceed $5,000,000 in the case of each FSO) issued by the Bank Guarantor pursuant to each Service Contract.
" Guarantees " means:
(a)
in relation to Euronav, the several guarantee of the liabilities of the Borrowers in respect of the Revolving Facility to be executed by Euronav in favour of the Security Trustee in Agreed Form; and
(b)
in relation to International Seaways, the several guarantee of the liabilities of the Borrowers in respect of the Term Loan to be executed by International Seaways in favour of the Security Trustee in Agreed Form.
" Guarantors " means each of Euronav and International Seaways.
" Holding Company " means, in relation to a person, any other person in relation to which it is a subsidiary.

11     



" IFRS " means international accounting standards within the meaning of the IAS Regulations 1606/2002 to the extent applicable to the relevant financial statements.
" Insurances " means, in relation to a FSO:
(a)
all policies and contracts of insurance, including entries of the FSO in any protection and indemnity or war risks association, which are effected in respect of the FSO, its Earnings or otherwise in relation to it; and
(b)
all rights and other assets relating to, or derived from, any of the foregoing, including any rights to a return of a premium.
" Interest Period " means a period determined in accordance with Clause 6 ( Interest Periods ).
" International Seaways " means International Seaways, 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.
" International Seaways Group " means International Seaways and each of its subsidiaries.
" Interpolated Screen Rate " means, in relation to the Loan or any part of the Loan, the rate (rounded to the same number of decimal places as the two relevant Screen Rates) which results from interpolating on a linear basis between:
(a)
the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the 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,
each as of the Specified Time for dollars.
" ISM Code " means the International Safety Management Code (including the guidelines on its implementation), adopted by the International Maritime Organisation as the same may be amended or supplemented from time to time (and the terms " safety management system ", " Safety Management Certificate " and " Document of Compliance " have the same meanings as are given to them in the ISM Code).
" ISPS Code " means the International Ship and Port Facility Security Code as adopted by the International Maritime Organisation, as the same may be amended or supplemented from time to time.
" ISSC " means a valid and current International Ship Security Certificate issued under the ISPS Code.
" Lender " means a bank or financial institution listed in Schedule 1 and acting through its branch indicated in Part A of Schedule 1 (or through another branch notified to the Agent under Clause 29.13 ( Change of lending office ) or its transferee, successor or assign.
" LIBOR " means, in relation to the Loan or any part of the Loan:
(a)
the applicable Screen Rate as of the Specified Time for dollars and for a period equal in length to the Interest Period of the Loan or that part of the Loan; or

12     



(b)
as otherwise determined pursuant to Clause 5.6 ( Unavailability of Screen Rate ),
and if, in either case, that rate is less than zero, LIBOR shall be deemed to be zero.
" Loan " means the principal amount for the time being outstanding under this Agreement.
" Major Casualty " means, in relation to a FSO, any casualty to the FSO in respect of which the claim or the aggregate of the claims against all insurers, before adjustment for any relevant franchise or deductible, exceeds $10,000,000 or the equivalent in any other currency.
" Majority Lenders " means:
(a)
before an Advance has been made, Lenders whose Commitments total 66⅔ per cent. or more of the Total Commitments; and
(b)
after an Advance has been made, Lenders whose Contributions total 66⅔ per cent. or more of the Loan 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 equal 66⅔ per cent. or more of the Loan immediately before such repayment.
" Mandated Lead Arrangers " means ABN AMRO Bank N.V. and ING Belgium SA/NV.
" Margin " means 2 per cent. per annum.
" Market Value " means, in relation to an FSO or any other vessel, at any date, an amount determined by the Facility Agent as being an amount equal to:
(a)
the market value of that FSO or vessel shown by a valuation prepared:
(i)
as at a date not more than 30 days previously;
(ii)
by an Approved Valuer;
(iii)
without physical inspection of that FSO or vessel; and
(iv)
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,
Less
(b)
an amount determined by the Facility Agent acting with the authorisation of the Majority Lenders as being an amount equal to the amount of the usual and reasonable expenses which would be reasonably likely to be incurred in connection with a sale described in sub-paragraph (iv) of paragraph (a) above.
" Master Agreement " means each master agreement (on the 2002 Master Agreement form as published by the International Swaps and Derivatives Association, Inc.) in the Agreed Form made between a Borrower and a Swap Bank and includes all Designated Transactions from time to time entered into and Confirmations from time to time exchanged under the master agreement.
" Master Agreement Assignment " means, in respect of a Borrower a master agreement security creating Security Interests over that Borrower's rights and interests in any Master Agreement, in Agreed Form.

13     



" Material Adverse Effect " means, in the reasonable opinion of the Majority Lenders, a material adverse affect on:
(a)
the ability of a Borrower, a Shareholder or a Guarantor to perform its obligations under the Finance Documents;
(b)
the validity or enforceability of, or the effectiveness or ranking of any Security Interest granted or purporting to be granted pursuant to any of the Finance Documents; or
(c)
the rights and remedies of the Creditor Parties (or any of them) under the Finance Document.
" Maturity Date " means in relation to:
(a)
Tranche A and Revolving Facility A, 21 July 2022; and
(b)
Tranche B and Revolving Facility B, 21 September 2022.
" Mortgage " means, in respect of each FSO, a first preferred Marshall Islands ship mortgage executed by the Borrower owning that FSO in favour of the Security Trustee in Agreed Form and to secure the obligations of the Borrowers under this Agreement, the Master Agreements and under the Guarantee Facility.
" NOC " means North Oil Company, a private joint-stock company organised and existing under the laws of the State of Qatar, registered under no. 90333 and having its registered office at 7 th Floor, The Gate Mall Tower 4, P.O. Box 21264, West Bay, Doha, State of Qatar.
" Negotiation Period " has the meaning given in Clause 5.14 ( Negotiation of alternative rate of interest ).
" Notifying Lender " has the meaning given in Clause 26.1 ( Illegality ) or Clause 27.1 ( Increased costs ) as the context requires.
" Parallel Debt " means any amount which a Borrower owes to the Security Trustee under Clause 23.2 ( Parallel Debt (Covenant to pay the Security Agent) ) or under that clause as incorporated by reference or in full in any other Finance Document.
" Participating Member State " means any member state of the European Union that has the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.
" Party " means a party to this Agreement.
" Payment Currency " has the meaning given in Clause 20.4 ( Currency indemnity ).
" Permitted Financial Indebtedness " means:
(a)
any Financial Indebtedness incurred under the Finance Documents, the Master Agreements or the Guarantee Facility; and
(b)
any Financial Indebtedness:
(i)
provided by the Shareholders;

14     



(ii)
in the form of a guarantee issued by a Borrower as a result of investments made by the Shareholders;
(iii)
or incurred in the ordinary course of business of a Borrower,
and, in each case, that is subordinated to all Financial Indebtedness incurred under the Finance Documents on terms acceptable to the Agent (acting on the instructions of the Lenders).
" Permitted Security Interests " means:
(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 2 months' prepaid hire under any charter in relation to a FSO 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 FSO, provided such liens do not secure amounts more than 30 days overdue (unless the overdue amount is being contested by the relevant Borrower in good faith by appropriate steps) and subject, in the case of liens for repair or maintenance, to paragraph (vi) of Clause 14.12 ( Restrictions on chartering, appointment of managers etc);
(f)
any Security Interest created in favour of a plaintiff or defendant in any proceedings or arbitration as security for costs and expenses while a Borrower is actively prosecuting or defending such proceedings or arbitration in good faith; and
(g)
Security Interests arising by operation of law in respect of taxes which are not overdue for payment or in respect of taxes being contested in good faith by appropriate steps and in respect of which appropriate reserves have been made.
" Pertinent Document " means:
(a)
any Finance Document;
(b)
any policy or contract of insurance contemplated by or referred to in Clause 13 ( Insurance ) or any other provision of this Agreement or another Finance Document;
(c)
any other document contemplated by or referred to in any Finance Document; and
(d)
any document which has been or is at any time sent by or to a Servicing Bank in contemplation of or in connection with any Finance Document or any policy, contract or document falling within paragraphs (b) or (c).
" Pertinent Jurisdiction ", in relation to a company, means:
(a)
England and Wales;
(b)
the country under the laws of which the company is incorporated or formed;

15     



(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;
(e)
a country in which assets of the company (other than securities issued by, or loans to, related companies) having a substantial value are situated, in which the company maintains a branch or permanent place of business, or in which a Security Interest created by the company must or should be registered in order to ensure its validity or priority; and
(f)
a country the courts of which have jurisdiction to make a winding up, administration or similar order in relation to the company, whether as a main or territorial or ancillary proceedings, or which would have such jurisdiction if their assistance were requested by the courts of a country referred to in paragraphs (b) or (c).
" Pertinent Matter " means:
(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),
and covers any such transaction, matter or statement, whether entered into, arising or made at any time before the signing of this Agreement or on or at any time after that signing.
" Potential Event of Default " means an event or circumstance which, with the giving of any notice, the lapse of time, a determination of the Majority Lenders and/or the satisfaction of any other condition, would constitute an Event of Default.
" Project " means, in relation to a FSO, the financing, ownership, operation and maintenance of that FSO as further outlined in the Service Contract for that FSO or any other service or employment permitted by the Lenders during the Security Period.
" Quiet Enjoyment Letter " means, in relation to each FSO, the letter of quiet enjoyment to be provided by the Security Trustee and acknowledged by NOC and the Borrower owning that FSO pursuant to the relevant Service Contract in a form consistent with exhibit X to that Service Contract or as otherwise agreed between that Borrower, NOC and the Agent (acting on the instructions of the Lenders).
" Quotation Date " means, in relation to any Interest Period (or any other period for which an interest rate is to be determined under any provision of a Finance Document), 3 Business Days before the first day of that period or the day on which quotations would ordinarily be given by leading banks in the London Interbank Market for deposits in the currency in relation to which such rate is to be determined for delivery on the first day of that Interest Period or other period.
" Reference Bank Quotation " means any quotation supplied to the Agent by a Reference Bank.
" Reference Bank Rate " means the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the Agent at its request by the Reference Banks:
(a)
if:

16     



(i)
the Reference Bank is a contributor to the Screen Rate; and
(ii)
it consists of a single figure,
as the rate (applied to the relevant Reference Bank and the relevant currency and period) which contributors to the Screen Rate are asked to submit to the relevant administrator; or
(b)
in any other case, as the rate at which the relevant Reference Bank could fund itself in dollars for the relevant period with reference to the unsecured wholesale funding market.
" Reference Banks " means, subject to Clause 29.15 ( Replacement of Reference Bank ), ING Bank N.V. and ABN AMRO Bank N.V.
" Related Fund " in relation to a fund (the " first fund "), means a fund which is managed or advised by the same investment manager or investment adviser as the first fund or, if it is managed by a different investment manager or investment adviser, a fund whose investment manager or investment adviser is an Affiliate of the investment manager or investment adviser of the first fund.
" Relevant Person " has the meaning given in Clause 18.9 ( Relevant Persons ).
" Requisition Compensation " includes all compensation or other moneys payable by reason of any act or event such as is referred to in paragraph (b) of the definition of " Total Loss ".
" Repayment Date " means:
(a)
in respect of a Tranche, a date on which a repayment is required to be made in respect of it under Clause 8 ( Repayment and Prepayment );
(b)
in relation to an Advance of the Revolving Facility, the last day of the Interest Period for that Advance selected by the Borrower in the Drawdown Notice (or otherwise determined in accordance with the provisions of Clause 6 ( Interest Periods ).
" Representative " means any delegate, agent, manager, administrator, nominee, attorney, trustee or custodian.
" Restricted Party " means a person:
(a)
that is listed on any Sanctions List (whether designated by name or by reason of being included in a class of person);
(b)
that is domiciled, registered as located or having its main place of business in, or is incorporated under the laws of, a country which is subject to Sanctions Laws which attach legal effect to being domiciled, registered as located or having its main place of business in such country; or
(c)
that is directly or indirectly owned or controlled by a person referred to in paragraph (a) and/or (b) above; or
(d)
with which any member of either Group is prohibited from dealing or otherwise engaging in a transaction with by any Sanctions Laws.

17     



" Revolving Commitment " means the Revolving Facility A Commitment or Revolving Facility B Commitment.
" Revolving Facility " means Revolving Facility A or Revolving Facility B.
" Revolving Facility A " means the revolving credit facility made available to TI Asia under this Agreement for general corporate purposes as described in paragraph (c) of Clause 2.1 ( Amount of facility ).
" Revolving Facility A Commitment " means:
(a)
in relation to a Lender named in this Agreement, the amount set opposite its name under the heading "Revolving Commitment" in Part B of Schedule 1 and the amount of any other Revolving Facility A Commitment transferred to it under this Agreement; and
(b)
in relation to any other Lender, the amount of any Revolving Facility A Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
" Revolving Facility B " means the revolving credit facility made available to TI Africa under this Agreement for general corporate purposes as described in paragraphs (d) of Clause 2.1 ( Amount of facility ).
" Revolving Facility B Commitment " means:
(a)
in relation to a Lender named in this Agreement, the amount set opposite its name under the heading "Revolving Commitment" in Part B of Schedule 1 and the amount of any other Revolving Facility B Commitment transferred to it under this Agreement; and
(b)
in relation to any other Lender, the amount of any Revolving Facility B Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
" Sanctions Authority " means the United Nations, the United Kingdom, the European Union, the member states of the European Union and the United States of America and any authority acting on behalf of any of them in connection with Sanctions Laws.
" Sanctions Laws " means the economic or financial sanctions laws and/or regulations, trade embargoes, prohibitions, restrictive measures, decisions, executive orders or notices from regulators implemented, adopted, imposed, administered, enacted and/or enforced by any Sanctions Authority.
" Sanctions List " means any list of persons or entities published in connection with Sanctions Laws by or on behalf of any Sanctions Authority as amended, revised, supplemented or substituted from time to time.
" Sanctions Relevant Person " means:
(a)
the Borrower;
(b)
each Guarantor;

18     



(c)
each subsidiary of the Borrower or a Guarantor; and
(d)
all respective directors, officers, employees, agents and representatives of each of the persons mentioned in paragraphs (a) to (c) above.
" Screen Rate " means the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for dollars for the relevant period displayed (before any correction, recalculation or republication by the administrator) on page LIBOR01 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate) or on the appropriate page of such other information service which publishes that rate from time to time in place of Thomson Reuters. If such page or service ceases to be available, the Agent may specify another page or service displaying the relevant rate after consultation with the Borrowers.
" Secured Liabilities " means all liabilities which the Borrowers, the Security Parties or any of them have, at the date of this Agreement or at any later time or times, under or in connection with any Finance Document or the Master Agreements or any judgment relating to any Finance Document or the Master Agreements; and for this purpose, there shall be disregarded any total or partial discharge of these liabilities, or variation of their terms, which is effected by, or in connection with, any bankruptcy, liquidation, arrangement or other procedure under the insolvency laws of any country.
" Security Interest " means:
(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 security rights of a plaintiff under an action in rem ; and
(c)
any arrangement entered into by a person (A) the effect of which is to place another person (B) in a position which is similar, in economic terms, to the position in which B would have been had he held a security interest over an asset of A; but this paragraph (c) does not apply to a right of set off or combination of accounts conferred by the standard terms of business of a bank or financial institution.
" Security Party " means each Guarantor and each Shareholder and any other person (except a Creditor Party) 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 paragraph (n) of the definition of " Finance Documents ".
" Security Period " means the period commencing on the date of this Agreement and ending on the date on which the Agent notifies the Borrowers, the Security Parties and the Lenders that:
(a)
all amounts which have become due for payment by any Borrower or any Security Party under the Finance Documents and the Master Agreements have been paid;
(b)
no amount is owing or has accrued (without yet having become due for payment) under any Finance Document or any Master Agreement;
(c)
neither any Borrower nor any Security Party has any future or contingent liability under Clause 19 ( Fees and Expenses ), 20 ( Indemnities ) or 21 ( No Set-Off or Tax Deduction ) or any other provision of this Agreement or another Finance Document or a Master Agreement; and

19     



(d)
the Agent, the Security Trustee and the Majority Lenders do not consider that there is a significant risk that any payment or transaction under a Finance Document or a Master Agreement would be set aside, or would have to be reversed or adjusted, in any present or possible future bankruptcy of a Borrower or a Security Party or in any present or possible future proceeding relating to a Finance Document or a Master Agreement or any asset covered (or previously covered) by a Security Interest created by a Finance Document.
" Security Property " means:
(a)
the Transaction Security expressed to be granted in favour of the Security Trustee as trustee for the Creditor Parties and all proceeds of that Transaction Security;
(b)
all obligations expressed to be undertaken by a Borrower or a Security Party to pay amounts in relation to the Secured Liabilities to the Security Trustee as trustee for the Creditor Parties and secured by the Transaction Security together with all representations and warranties expressed to be given by a Borrower, a Security Party or any other person in favour of the Security Trustee as trustee for the Creditor Parties;
(c)
the Security Trustee'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 Trustee is required by the terms of the Finance Documents to hold as trustee on trust for the Creditor Parties,
except:
(i)
rights intended for the sole benefit of the Security Trustee; and
(ii)
any moneys or other assets which the Security Trustee has transferred to the Agent or (being entitled to do so) has retained in accordance with the provisions of this Agreement.
" Security Trustee " means ING Bank N.V., acting in such capacity through its office at Bijlmerplein 888, 1102 MG, Amsterdam, The Netherlands, or any successor of it.
" Service Contracts " means each of the FSO 1 Service Contract and the FSO 2 Service Contract.
" Service Contract Rights " means, in relation to a Service Contract:
(a)
all rights and interests relating to any amount of any kind payable under the terms of that Service Contract;
(b)
all rights to have NOC take the FSO pursuant to that Service Contract or withdraw the FSO from NOC;
(c)
all rights to commence, conduct, defend or compromise or abandon any legal or arbitration proceedings relating to that Service Contract or any matter arising out of or in connection with the Service Contract; and
(d)
to the extent not included in the foregoing, the Assigned Property defined in the Service Contract Assignment for that Service Contract.
" Servicing Bank " means the Agent or the Security Trustee.

20     



" Service Contract Assignment " means, in relation an FSO, the assignment in relation to the relevant Service Contract to be executed by the Borrower owning that FSO in favour of the Security Trustee in Agreed Form and to secure the obligations of the Borrowers under this Agreement, the Master Agreements and under the Guarantee Facility.
" Shareholders " means, in relation to each Borrower, Euronav Hong Kong Limited, a company incorporated in Hong Kong, and Africa Tanker Corporation, a corporation incorporated in the Marshall Islands.
" Share Security Deed " means, in relation to a Borrower, a deed creating security over the shares of that Borrower each to be executed by the relevant Shareholders in favour of the Security Trustee in Agreed Form.
" Specified Time " means a day or time determined in accordance with Schedule 8 ( Timetables ).
"Subordinated Creditor " means each Shareholder.
" Subordinated Finance Document " means:
(a)
a Subordinated Loan Agreement; and
(b)
any other document relating to or evidencing Subordinated Liabilities.
" Subordinated Liabilities " means all indebtedness owed or expressed to be owed by either Borrower to a Subordinated Creditor whether under the Subordinated Finance Documents or otherwise.
" Subordinated Loan Agreement " means:
(a)
in respect of TI Asia, a series of loan agreements, dated prior to the date of this Agreement, and made between (i) TI Asia and (ii) the Shareholders, copies of which have been provided to the Agent; and
(b)
in respect of TI Africa, a series of loan agreements, dated prior to the date of this Agreement, and made between (i) TI Africa and (ii) the Shareholders, copies of which have been provided to the Agent.
" Subordination Agreement " means a subordination agreement entered into or to be entered into by each Subordinated Creditor, each Borrower and the Agent in Agreed Form.
" Swap Bank " means a bank or financial institution listed in Part B of Schedule 1 and acting through its branch indicated in Part B of Schedule 1.
" Swap Counterparty " means, at any relevant time and in relation to a continuing Designated Transaction, the Swap Bank which is a party to that Designated Transaction.
" Swap Exposure " means, as at any relevant date and in relation to a Swap Counterparty, the amount certified by that Swap Counterparty to the Agent to be the aggregate net amount in Dollars which would be payable by the Borrowers to that Swap Counterparty under (and calculated in accordance with) section 6(e) (Payments on Early Termination) of the Master Agreements entered into by that Swap Counterparty with the Borrowers if an Early Termination Date had occurred on the relevant date in relation to all continuing Designated Transactions entered into between a Borrower and that Swap Counterparty.

21     



" Term Commitment " means a Tranche A Commitment or Tranche B Commitment.
" Term Facility " means the term loan facility made available under this Agreement as described in paragraphs (a) and (b) of Clause 2.1 ( Amount of facility ).
" Term Loan " means the aggregate amount of Advances to be made available under the Term Facility or the aggregate principal amount outstanding for the time being of the borrowings under the Term Facility.
" TI Africa " means TI Africa Limited, a company incorporated in Hong Kong whose registered office is at Room 2503-05, 25 th Floor, Harcourt House, No. 39 Gloucester Road, Wanchai, Hong Kong.
" TI Asia " means TI Asia Limited, a company incorporated in Hong Kong whose registered office is at Room 2503-05, 25 th Floor, Harcourt House, No. 39 Gloucester Road, Wanchai, Hong Kong.
" Total Commitments " means the aggregate of the Total Revolving Commitments and the Total Term Commitments, being $220,000,000 at the date of this Agreement.
" Total Loss " means, in relation to a FSO:
(a)
actual, constructive, compromised, agreed or arranged total loss of the FSO;
(b)
any expropriation, confiscation, requisition, acquisition or deprivation of the FSO, 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 1 year without any right to an extension) unless it is within 3 months redelivered to the full control of the Borrower owning the FSO; and
(c)
any arrest, capture, seizure or detention of the FSO (including any hijacking or theft) unless it is within 3 months redelivered to the full control of the Borrower owning the FSO.
" Total Loss Date " means, in relation to a FSO:
(a)
in the case of an actual loss of the FSO, the date on which it occurred or, if that is unknown, the date of the last communication from the FSO;
(b)
in the case of a constructive, compromised, agreed or arranged total loss of the FSO, 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 Borrower owning the FSO with the FSOs' insurers in which the insurers agree to treat the FSO as a total loss; 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.
" Total Revolving Commitments " means the aggregate of the Revolving Facility A Commitment or Revolving Facility B Commitment, being $110,000,000 at the date of this Agreement.

22     



" Total Term Commitments " means the aggregate of the Tranche A Commitment and Tranche B Commitment, being $110,000,000 at the date of this Agreement.
" Tranche " means Tranche A or Tranche B.
" Tranche A " means that part of the Term Loan made or to be made available to TI Asia for general corporate purposes in a principal amount not exceeding $54,000,000.
" Tranche A Commitment " means:
(a)
in relation to a Lender named in this Agreement, the amount set opposite its name under the heading "Tranche A" in Part A of Schedule 1 ( Lenders and Commitments ) and the amount of any other Tranche A Commitment transferred to it under this Agreement; and
(b)
in relation to any other Lender, the amount of any Tranche A Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
" Tranche B " means that part of the Term Loan made or to be made available to TI Africa for general corporate purposes in a principal amount not exceeding $56,000,000.
" Tranche B Commitment " means:
(a)
in relation to a Lender named in this Agreement, the amount set opposite its name under the heading "Tranche B" in Part A of Schedule 1 ( Lenders and Commitments ) and the amount of any other Tranche B Commitment transferred to it under this Agreement; and
(b)
in relation to any other Lender, the amount of any Tranche B Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
" Transaction " has the meaning given in each Master Agreement.
" Transaction Security" means the Security Interests created or evidenced or expressed to be created or evidenced under the Finance Documents.
" Transfer Certificate " has the meaning given in Clause 29.2 ( Transfer by a Lender ).
" Unpaid Sum " means any sum due and payable but unpaid by a Borrower or Security Party under the Finance Documents.
" VAT " means:
(a)
any tax imposed in compliance with the Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and
(b)
any other tax of a similar nature, whether imposed in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) above, or imposed elsewhere.
" Write-down and Conversion Powers " means:

23     



(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.
1.2
Construction of certain terms
In this Agreement:
" administration notice " means a notice appointing an administrator, a notice of intended appointment and any other notice which is required by law (generally or in the case concerned) to be filed with the court or given to a person prior to, or in connection with, the appointment of an administrator.
" approved " means, for the purposes of Clause 13 ( Insurance ), approved in writing by the Agent.
" asset " includes every kind of property, asset, interest or right, including any present, future or contingent right to any revenues or other payment.
" company " includes any partnership, joint venture and unincorporated association.
" consent " includes an authorisation, consent, approval, resolution, licence, exemption, filing, registration, notarisation and legalisation.
" contingent liability " means a liability which is not certain to arise and/or the amount of which remains unascertained.
" document " includes a deed; also a letter or fax.
" excess risks " means, in relation to a FSO, the proportion of claims for general average, salvage and salvage charges not recoverable under the hull and machinery policies in respect of the FSO in consequence of its insured value being less than the value at which the FSO is assessed for the purpose of such claims.
" expense " means any kind of cost, charge or expense (including all legal costs, charges and expenses) and any applicable value added or other tax.
" 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.

24     



" legal or administrative action " means any legal proceeding or arbitration and any administrative or regulatory action or investigation.
" liability " includes every kind of debt or liability (present or future, certain or contingent), whether incurred as principal or surety or otherwise.
" months " shall be construed in accordance with Clause 1.3 ( Meaning of "month" ).
" obligatory insurances " means, in relation to a FSO, all insurances effected, or which the Borrower owning the FSO is obliged to effect, under Clause 13 (Insurance) or any other provision of this Agreement or another Finance Document.
" parent company " has the meaning given in Clause 1.4 ( Meaning of "subsidiary" ).
" person " includes any company; any state, political sub-division of a state and local or municipal authority; and any international organisation.
" policy ", in relation to any insurance, includes a slip, cover note, certificate of entry or other document evidencing the contract of insurance or its terms.
" protection and indemnity risks " means the usual risks covered by a protection and indemnity association managed in London, including pollution risks and the proportion (if any) of any sums payable to any other person or persons in case of collision which are not recoverable under the hull and machinery policies by reason of the incorporation in them of clause 6 of the International Hull Clauses (1/11/02 or 1/11/03), clause 8 of the Institute Time Clauses (Hulls) (1/11/95) or clause 8 of the Institute Time Clauses (Hulls) (1/10/83) or the Institute Amended Running Down Clause (1/10/71) or any equivalent provision.
" 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.
" subsidiary " has the meaning given in Clause 1.4 ( Meaning of "subsidiary" ).
" tax " includes any present or future tax, duty, impost, levy or charge of any kind which is imposed by any state, any political sub-division of a state or any local or municipal authority (including any such imposed in connection with exchange controls), and any connected penalty, interest or fine.
" war risks " includes the risk of mines and all risks excluded by clause 29 of the International Hull Clauses (1/11/02 or 1/11/03), clause 24 of the Institute Time Clauses (Hulls)(1/11/95) or clause 23 of the Institute Time Clauses (Hulls) (1/10/83).
1.3
Meaning of "month"
A period of one or more " months " ends on the day in the relevant calendar month numerically corresponding to the day of the calendar month on which the period started (" the numerically corresponding day "), but:
(a)
on the Business Day following the numerically corresponding day if the numerically corresponding day is not a Business Day or, if there is no later Business Day in the same calendar month, on the Business Day preceding the numerically corresponding day; or

25     



(b)
on the last Business Day in the relevant calendar month, if the period started on the last Business Day in a calendar month or if the last calendar month of the period has no numerically corresponding day,
and " month " and " monthly " shall be construed accordingly.
1.4
Meaning of "subsidiary"
A company (S) is a subsidiary of another company (P) if:
(a)
a majority of the issued shares in S (or a majority of the issued shares in S which carry unlimited rights to capital and income distributions) are directly owned by P or are indirectly attributable to P; or
(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,
and any company of which S is a subsidiary is a parent company of S.
1.5
General Interpretation
In this Agreement:
(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;
(d)
a Default is "continuing" if it has not been remedied or waived in writing; and
(e)
Clauses 1.1 ( Definitions ) to 1.5 ( General Interpretation ) apply unless the contrary intention appears.
1.6
Headings
In interpreting a Finance Document or any provision of a Finance Document, all clause, sub‑clause and other headings in that and any other Finance Document shall be entirely disregarded.
2
FACILITY
2.1
Amount of facility
Subject to the other provisions of this Agreement, the Lenders shall make available to the Borrowers a loan facility not exceeding $220,000,000 comprised of:
(a)
Tranche A of the Term Loan in a principal amount not exceeding $54,000,000 to be provided to TI Asia;

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(b)
Tranche B of the Term Loan in a principal amount not exceeding $56,000,000 to be provided to TI Africa;
(c)
Revolving Facility A in a principal amount not exceeding $54,000,000 to be provided to TI Asia; and
(d)
Revolving Facility B in a principal amount not exceeding $56,000,000 to be provided to TI Africa,
in each case to be provided to the relevant Borrower for general corporate purposes but excluding refinancing any obligation for which that Borrower has issued debt instruments in the financial markets and which are normally rolled over or refinanced in the financial markets upon maturity.
2.2
Lenders' participations in Advances
Subject to the other provisions of this Agreement, each Lender shall participate in each Advance in the proportion which, as at the relevant Drawdown Date, its Available Commitment in respect of the relevant Tranche or Revolving Facility bears to the relevant part of the Total Commitments.
2.3
Purpose of Advances
The Borrowers undertake with each Creditor Party to use each Advance only for the purpose stated in the preamble to this Agreement.
3
POSITION OF THE LENDERS AND SWAP BANKS
3.1
Interests several
The rights of the Lenders and of the Swap Banks under this Agreement and under the Master Agreements are several.
3.2
Individual right of action
Each Lender may, except as specifically provided in the Finance Documents and Master Agreements, separately enforce its rights under or in connection with the Finance Documents and Master Agreements.
3.3
Proceedings requiring Majority Lenders' consent
Except as provided in Clause 3.2 ( Individual right of action ), no Lender and no Swap Bank may commence proceedings against any Borrower or any Security Party in connection with a Finance Document or a Master Agreement without the prior consent of the Majority Lenders.
3.4
Obligations several
The obligations of the Lenders under this Agreement and of the Swap Banks under the Master Agreement to which each is a party are several; and a failure of a Lender to perform its obligations under this Agreement or a failure of a Swap Bank to perform its obligations under the Master Agreement to which it is a party shall not result in:
(a)
the obligations of the other Lenders or Swap Banks being increased; nor
(b)
any Borrower, any Security Party, any other Lender or any other Swap Bank being discharged (in whole or in part) from its obligations under any Finance Document or under any Master Agreement;

27     



and in no circumstances shall a Lender or a Swap Bank have any responsibility for a failure of another Lender or another Swap Bank to perform its obligations under this Agreement or a Master Agreement.
4
DRAWDOWN
4.1
Request for Advance
Subject to the following conditions, the Borrowers may request an Advance to be made by ensuring that the Agent receives a completed Drawdown Notice not later than 11.00 a.m. (Amsterdam time) 3 Business Days prior to the intended Drawdown Date.
4.2
Availability
The conditions referred to in Clause 4.1 ( Request for Advance ) are that:
(a)
a Drawdown Date has to be a Business Day during the Availability Period;
(b)
both Tranches of the Term Loan shall be made available in a single Advance;
(c)
the amount of the Advance of each Tranche shall not exceed such an amount that, when aggregated with the Revolving Facility in respect of the same Ship, equals the relevant Facility Cap with the amount of the relevant Tranche and the Revolving Facility in excess of that Facility Cap to be reduced pro rata by, in the case of the Term Loan, reducing the amount of the relevant Advance and, in the case of the Revolving Facility, by the automatic cancellation of a sufficient amount of the Revolving Commitment in respect of the relevant Revolving Facility pursuant to paragraph (c) of Clause 8.5 ( Voluntary and automatic cancellation ).
(d)
the aggregate amount of the Advances in respect of a Revolving Facility shall not exceed the Total Commitments in respect of that Revolving Facility;
(e)
there shall be no more than 3 Advances of each Revolving Facility outstanding at any time; and
(f)
each Advance of a Revolving Facility shall be in the amount of $10,000,000 or an integral multiple thereof.
4.3
Notification to Lenders of receipt of a Drawdown Notice
The Agent shall promptly notify the Lenders that it has received a Drawdown Notice and shall inform each Lender of:
(a)
the amount of the Advance, the Tranche to which the Advance relates to and the Drawdown Date;
(b)
the amount of that Lender's participation in the Advance; and
(c)
the duration of the first Interest Period (and, in the case of an Advance of the Revolving Facility, the Repayment Date for the Advance).
4.4
Drawdown Notice irrevocable
A Drawdown Notice must be signed by 2 directors or by a duly authorised person on behalf of the Borrowers; and once served, a Drawdown Notice cannot be revoked without the prior consent of the Agent.
4.5
Lenders to make available Contributions

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Subject to the provisions of this Agreement, each Lender shall, on and with value on each Drawdown Date, make available to the Agent for the account of the Borrowers the amount due from that Lender on that Drawdown Date under Clause (a) ( Lenders' participations in Advances ).
4.6
Disbursement of Advance
Subject to the provisions of this Agreement, the Agent shall on each Drawdown Date pay to the Borrowers the amounts which the Agent receives from the Lenders under Clause 4.5 ( Lenders to make available Contributions ); and that payment to the Borrowers shall be made to the account which the Borrowers specify in the Drawdown Notice.
4.7
Disbursement of Advance to third party
The payment by the Agent under Clause 4.6 ( Disbursement of Advance ) to any third party shall constitute the making of the Advance and the Borrowers shall at that time become indebted, as principal and direct obligors, to each Lender in an amount equal to that Lender's Contribution.
5
INTEREST
5.1
Payment of normal interest
Subject to the provisions of this Agreement, interest on an Advance in respect of each Interest Period applicable to it shall be paid by the Borrowers on the last day of that Interest Period.
5.2
Normal rate of interest
Subject to the provisions of this Agreement, the rate of interest on an Advance in respect of an Interest Period applicable to it shall be the aggregate of the Margin and LIBOR for that Interest Period.
5.3
Payment of accrued interest
In the case of an Interest Period longer than 3 months, accrued interest shall be paid every 3 months during that Interest Period and on the last day of that Interest Period.
5.4
Notification of rates of interest
(a)
The Agent shall notify the Borrowers and each Lender of each rate of interest as soon as practicable after each is determined.
(b)
The Agent shall promptly notify the Borrowers of each Funding Rate relating to the Loan, any part of the Loan or any Unpaid Sum.
5.5
Role of Reference Banks
(a)
No Reference Bank is under any obligation to provide a quotation or any other information to the 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

29     



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 5.5 ( Role of Reference Banks ) subject to Clause 35.4 ( Third Party rights ) and the provisions of the Third Parties Act.
5.6
Third Party Reference Banks
A Reference Bank which is not a Party may rely on Clause 5.5 ( Role of Reference Banks ), Clause 5.13 ( Replacement of Screen Rate ) and Clause 31 ( Confidentiality of Funding Rates and Reference Bank Quotations ) subject to Clause 35.4 ( Third Party rights ) and the provisions of the Third Parties Act.
5.7
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)
Reference Bank Rate : 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,
the applicable LIBOR shall be the Reference Bank Rate 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.
(c)
Cost of funds : If paragraph (b) above applies but no Reference Bank Rate is available for dollars or the relevant Interest Period there shall be no LIBOR for the Loan or that part of the Loan (as applicable) and Clause 5.10 ( Cost of funds ) shall apply to the Loan or that part of the Loan for that Interest Period.
5.8
Calculation of Reference Bank Rate
(a)
Subject to paragraph (b) below, if LIBOR is to be determined on the basis of a Reference Bank Rate but any one Reference Bank does not supply a Reference Bank Quotation by the Specified Time, the Reference Bank Rate shall be calculated on the basis of the Reference Bank Quotations of the remaining Reference Banks.
(b)
If at or about noon on the Quotation Date none or only one of the Reference Banks supplies a quotation, there shall be no Reference Bank Rate for the relevant Interest Period.
5.9
Market disruption
If before close of business in London on the Quotation Date for the relevant Interest Period the Agent receives notification from a Lender or Lenders (whose participations in the Loan or the relevant part of the Loan exceed 50 per cent. of the Loan or the relevant part of the Loan as appropriate) (the " Affected Lender ") that the cost to it of funding its participation in the Loan or that part of the Loan from whatever source it may reasonably select would be in excess of LIBOR then the Agent shall notify the Borrower and Clause 5.10 ( Cost of funds ) shall apply to the Loan or that part of the Loan (as applicable) for the relevant Interest Period.
5.10
Cost of funds

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(a)
If this Clause 5.10 ( Cost of funds ) applies, the rate of interest on each Lender's share of 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 applicable Margin; and
(ii)
the weighted average of the rates notified to the Agent by each Lender 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 relevant Lender of funding its participation in the Loan or that part of the Loan from whatever source it may reasonably select.
(b)
If paragraph (c) below does not apply and any rate notified to the Agent under sub-paragraph (ii) of paragraph (a) above is less than zero, the relevant rate shall be deemed to be zero.
(c)
If this Clause 5.10 ( Cost of funds ) applies pursuant to Clause 5.9 ( Market disruption ) and:
(i)
a Lender's Funding Rate is less than LIBOR; or
(ii)
a Lender does not supply a quotation by the time specified in sub-paragraph ‎(ii) of paragraph (a) above,
the cost to that Lender of funding its participation in the Loan or the relevant part of the Loan for that Interest Period shall be deemed, for the purposes of paragraph (a) above, to be LIBOR.
5.11
Notification of market disruption
The Agent shall notify the Borrower and each of the Lenders stating the circumstances falling within Clause 5.9 ( Market disruption ) which have caused its notice to be given.
5.12
Suspension of drawdown
If the Agent’s notice under Clause 5.11 ( Notification of market disruption ) is served before an Advance is made the Lenders’ obligations to make or participate in that Advance (as the case may be) shall be suspended while the circumstances referred to in the Agent’s notice continue.
5.13
Replacement of Screen Rate
(a)
If the Screen Rate is not available for dollars, any amendment or waiver which relates to providing for another benchmark rate to apply in relation to dollars, in place of that Screen Rate (or which relates to aligning any provision of a Finance Document to the use of that benchmark rate) may be made with the consent of the Majority Lenders and the Borrowers
(b)
If any Lender fails to respond to a request for an amendment or waiver described in paragraph (a) above within three Business Days (unless the Borrowers and the Agent agree to a longer time period in relation to any request) of that request being made:
(i)
its Commitment shall not be included for the purpose of calculating the Total Commitments when ascertaining whether any relevant percentage of Total Commitments 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.

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5.14
Negotiation of alternative rate of interest
If the Agent’s notice under Clause 5.11 ( Notification of market disruption ) is served after an Advance is made, the Borrower, the Agent and the Lenders or (as the case may be) the Affected Lender shall use reasonable endeavours to agree, within the 15 days after the date on which the Agent serves its notice under Clause 5.11 ( Notification of market disruption ) (the " Negotiation Period "), an alternative interest rate or (as the case may be) an alternative basis for the Lenders or (as the case may be) the Affected Lender to fund or continue to fund their or its Contribution during the relevant Interest Period concerned.
5.15
Application of agreed alternative rate of interest
Any alternative interest rate or an alternative basis which is agreed during the Negotiation Period shall take effect in accordance with the terms agreed and shall, with the prior consent of all the Lenders, the Swap Counterparties and the Borrowers, be binding on all Parties.
5.16
Alternative rate of interest in absence of agreement
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 Agent shall, with the agreement of each Lender and the Swap Counterparties or (as the case may be) the Affected Lender, set an interest period and interest rate representing the cost of funding of the Lenders and Swap Counterparties or (as the case may be) the Affected Lender in Dollars or in any available currency of their or its Contribution plus the applicable Margin; and the procedure provided for by this Clause 5.16 ( Alternative rate of interest in absence of agreement ) shall be repeated if the relevant circumstances are continuing at the end of the interest period so set by the Agent.
5.17
Notice of prepayment
If the Borrowers do not agree with an interest rate set by the Agent under Clause 5.16 ( Alternative rate of interest in absence of agreement ), the Borrowers may give the Agent not less than 10 Business Days’ notice of its intention to prepay the relevant Advance at the end of the interest period set by the Agent.
5.18
Prepayment
A notice under Clause 5.17 ( Notice of prepayment ) shall be irrevocable; the Agent shall promptly notify the Lenders or (as the case may require) the Affected Lender of the Borrowers' notice of intended prepayment; and on the last Business Day of the interest period set by the Agent, the Borrower shall prepay (without premium or penalty) the relevant Advance, together with accrued interest thereon at the applicable rate plus the applicable Margin.
5.19
Application of prepayment
The provisions of Clause 8 ( Repayment, Prepayment and cancellation ) shall apply in relation to the prepayment.
6
INTEREST PERIODS
6.1
Commencement of Interest Periods

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(a)
The first Interest Period applicable to an Advance of the Term Loan shall commence on the Drawdown Date of that Advance and each subsequent Interest Period applicable to that Advance shall commence on the expiry of the preceding Interest Period applicable to it.
(b)
There shall be a single Interest Period for each Advance of a Revolving Facility, which shall be notified by the Borrower to the Agent in the Drawdown Notice for that Advance.
6.2
Duration of normal Interest Periods
Subject to Clauses 6.3 ( Duration of Interest Periods for repayment instalments ) and 6.4 ( Non-availability of matching deposits for Interest Period selected ), each Interest Period shall be:
(a)
3, 6 or 12 months as notified by the Borrowers to the Agent not later than 11.00 a.m. (London time) 3 Business Days before the commencement of the Interest Period; or
(b)
3 months, if the Borrowers fail to notify the Agent by the time specified in paragraph (a) or in the Drawdown Notice for that Advance; or
(c)
such other period as the Agent may, with the authorisation of the Lenders, agree with the Borrowers.
6.3
Duration of Interest Periods for repayment instalments
In respect of an amount due to be repaid under Clause 8 ( Repayment, Prepayment and cancellation ) on a particular Repayment Date, an Interest Period shall end on that Repayment Date.
6.4
Non-availability of matching deposits for Interest Period selected
If, after the Borrowers have selected and the Lenders have agreed an Interest Period longer than 3 months, any Lender notifies the Agent by 11.00 a.m. (Amsterdam time) on the third Business Day before the commencement of the Interest Period that it is not satisfied that deposits in Dollars for a period equal to the Interest Period will be available to it in the London Interbank Market when the Interest Period commences, the Interest Period shall be 3 months unless otherwise agreed by the Agent (acting with the authorisation of the Lenders) and the Borrower.
6.5
No Interest Period to extend beyond Maturity Date
No Interest Period shall end after the Maturity Date and any Interest Period which would otherwise extend beyond the Maturity Date shall instead end on the Maturity Date.
6.6
Non-Business Days
If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the precedent Business Day (if there is not).
7
DEFAULT INTEREST
7.1
Payment of default interest on overdue amounts
The Borrowers shall pay interest in accordance with the following provisions of this Clause 7 ( Default interest ) on any amount payable by the Borrowers under any Finance Document which

33     



the Agent, the Security Trustee or other designated payee does not receive on or before the relevant date, that is:
(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 18.4 (Acceleration of Loan ) , the date on which it became immediately due and payable.
7.2
Default rate of interest
Interest shall accrue on an overdue amount from (and including) the relevant date until the date of actual payment (as well after as before judgment) at the rate per annum determined by the Agent to be 2 per cent. above:
(a)
in the case of an overdue amount of principal, the higher of the rates set out at paragraphs (a) and (b) of Clause 7.3 ( Calculation of default rate of interest ); or
(b)
in the case of any other overdue amount, the rate set out at paragraph (b) of Clause 7.3 ( Calculation of default rate of interest ).
7.3
Calculation of default rate of interest
The rates referred to in Clause 7.2 ( Default rate of interest ) are:
(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);
(b)
the Margin plus, in respect of successive periods of any duration (including at call) up to 3 months which the Agent may select from time to time:
(i)
LIBOR; or
(ii)
if the Agent (after consultation with the Reference Banks) determines that Dollar deposits for any such period are not being made available to any Reference Bank by leading banks in the London Interbank Market in the ordinary course of business, a rate from time to time determined by the Agent by reference to the cost of funds to the Reference Banks from such other sources as the Agent (after consultation with the Reference Banks) may from time to time determine.
7.4
Notification of interest periods and default rates
The Agent shall promptly notify the Lenders and the Borrowers of each interest rate determined by the Agent under Clause 7.3 ( Calculation of default rate of interest ) and of each period selected by the Agent for the purposes of paragraph (b) of that Clause; but this shall not be taken to imply that the Borrowers are liable to pay such interest only with effect from the date of the Agent's notification.
7.5
Payment of accrued default interest

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Subject to the other provisions of this Agreement, any interest due under this Clause shall be paid on the last day of the period by reference to which it was determined; and the payment shall be made to the Agent for the account of the Creditor Party to which the overdue amount is due.
7.6
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 thereupon be compounded.
7.7
Application to Master Agreements
For the avoidance of doubt, this Clause 7 ( Default Interest ) does not apply to any amount payable under a Master Agreement in respect of any continuing Designated Transaction as to which section 2(e) (Default Interest; Other Amounts) of that Master Agreement shall apply.
8
REPAYMENT, PREPAYMENT AND CANCELLATION
8.1
Amount of repayment instalments
(a)
The Borrowers shall repay each Tranche of the Term Facility by quarterly instalments in the amounts specified in Schedule 2 ( Term Facility Repayment Instalments ).
(b)
Each Advance of a Revolving Facility shall be repaid in full on the Repayment Date applicable to it.
(c)
Without prejudice to the Borrower's obligation under paragraph (b) above, if:
(i)
an Advance under a Revolving Facility is to be made available:
(A)
on the same day that a maturing Advance under that Revolving Facility is due to be repaid; and
(B)
in whole or in part for the purpose of refinancing the maturing Advance under that Revolving Facility; and
(ii)
the proportion borne by each Lender's participation in the maturing Advance under that Revolving Facility to the amount of that maturing Advance under that Revolving Facility is the same as the proportion borne by that Lender's participation in the new Advance under the Revolving Facility to the amount of the new Advance under that Revolving Facility,
the amount of the new Advance under that Revolving Facility shall, unless the Borrowers notify the Facility Agent to the contrary in the relevant Drawdown Notice, be treated as if applied in or towards repayment of the maturing Advance under that Revolving Facility so that:
(A)
if the amount of the maturing Advance under that Revolving Facility exceeds the amount of the new Advance under that Revolving Facility:
(1)
the Borrowers will only be required to make a payment under Clause 15.1 ( Currency and method of payments ) in an amount equal to that excess; and
(2)
each Lender's participation in the new Advance under that Revolving Facility shall be treated as having been made available and applied by

35     



the Borrowers in or towards repayment of that Lender's participation in the maturing Advance under that Revolving Facility and that Lender will not be required to make a payment under Clause 15.1 ( Currency and method of payments ) in respect of its participation in the new Advance under that Revolving Facility; and
(B)
if the amount of the maturing Advance under a Revolving Facility is equal to or less than the amount of the new Advance under the Revolving Facility:
(1)
the Borrowers will not be required to make a payment under Clause 15.1 ( Currency and method of payments ); and
(2)
each Lender will be required to make a payment under Clause 15.1 ( Currency and method of payments ) in respect of its participation in the new Advance under that Revolving Facility only to the extent that its participation in the new Advance under that Revolving Facility exceeds that Lender's participation in the maturing Advance under that Revolving Facility and the remainder of that Lender's participation in the new Advance under that Revolving Facility shall be treated as having been made available and applied by the Borrowers in or towards repayment of that Lender's participation in the maturing Advance under that Revolving Facility.
8.2
Repayment Dates
Each instalment of the Term Facility shall be repaid on the relevant date specified in Schedule 2 ( Term Facility Repayment Instalments ).
8.3
Reduction of the Revolving Facility
(a)
The Revolving Commitments in respect of each Revolving Facility shall be reduced in instalments on each Reduction Date by an amount equal to the amount set out opposite that Reduction Date in Schedule 3 ( Reduction Amounts ).
(b)
The Borrower shall ensure that sufficient Advances under each Revolving Facility are repaid on a Reduction Date to the extent necessary so that the aggregate of the outstanding Advances under each Revolving Facility (after that repayment) is equal to or less than the reduced amount of the Revolving Commitments in respect of that Revolving Facility.
(c)
Any reduction of the Revolving Commitments in respect of a Revolving Facility in accordance with this Clause shall reduce rateably the Commitment of each Lender.
8.4
Final Repayment Date
On the Maturity Date for each Tranche and each Revolving Facility, the Borrowers shall additionally pay to the Agent for the account of the Creditor Parties all other sums then accrued or owing under any Finance Document in relation to that Tranche or Revolving Facility.
8.5
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 without penalty the whole or any part (being a minimum amount of $1,000,000) of an Available Facility. Any cancellation

36     



under this Clause 8.5 ( Voluntary and automatic cancellation ) shall reduce the Commitments of the Lenders rateably under that Facility or Tranche.
(b)
The unutilised Term Commitment (if any) of each Lender shall be automatically cancelled at close of business on the date on which the Advance in respect of the Term Loan is made available.
(c)
An amount of the Revolving Commitment in respect of a Revolving Facility equal to the amount required to ensure that the aggregate of the Revolving Commitment in respect of that Revolving Facility and the Advance of the Tranche relating to the same Ship does not exceed the relevant Facility Cap (by reducing the maximum amount of that Tranche and Revolving Facility pro rata) shall be automatically cancelled without penalty at close of business on the date on which the Advance of the Tranche in respect of that Ship is made available.
8.6
Voluntary prepayment
Subject to the following conditions, the Borrowers may prepay, without penalty, the whole or any part of the Loan.
8.7
Conditions for voluntary prepayment
The conditions referred to in Clause 8.6 ( Voluntary prepayment ) are that:
(a)
a partial prepayment shall be $1,000,000 or an integral multiple of $1,000,000 (or such other amount as may be agreed by the Agent);
(b)
the Agent has received from the Borrowers at least 10 Business Days prior written notice specifying the amount to be prepaid and the date on which the prepayment is to be made; and
(c)
the Borrowers have provided evidence satisfactory to the Agent that any consent required by any Borrower or any Security Party in connection with the prepayment has been obtained and remains in force, and that any official regulation relevant to this Agreement which affects any Borrower or any Security Party has been complied with.
8.8
Effect of notice of prepayment
A prepayment notice may not be withdrawn or amended without the consent of the Agent, given with the authorisation of the Majority Lenders, and the amount specified in the prepayment notice shall become due and payable by the Borrowers on the date for prepayment specified in the prepayment notice.
8.9
Notification of notice of prepayment
The Agent shall notify the Lenders promptly upon receiving a prepayment notice, and shall provide any Lender which so requests with a copy of any document delivered by the Borrowers under paragraph (c) of Clause 8.7 ( Conditions of voluntary prepayment ).
8.10
Mandatory prepayment on sale or Total Loss
The Borrowers shall be obliged to prepay the relevant part of the Loan and the Revolving Commitment in respect of the Revolving Facility relating to the relevant FSO shall terminate if a FSO is sold or becomes a Total Loss:
(a)
in the case of a sale, on or before the date on which the sale is completed by delivery of the FSO to the buyer; or

37     



(b)
in the case of a Total Loss, on the earlier of the date falling 90 days after the Total Loss Date and the date of receipt by the Security Trustee of the proceeds of insurance relating to such Total Loss.
In this Clause 8.10 ( Mandatory prepayment on sale or Total Loss ) and in Clause 8.11 ( Mandatory prepayment on termination of Service Contract ) the " relevant part " means:
(i)
if the FSO which is sold or which is a Total Loss is FSO 1 or if the FSO 1 Service Contract is terminated, the full amount of Tranche A and Revolving Facility A; and
(ii)
if the FSO which is sold or which is a Total Loss is FSO 2 or if the FSO 2 Service Contract is terminated, the full amount of Tranche B and Revolving Facility B.
Subject to paragraph of Clause 8.6 ( Voluntary prepayment ), upon prepayment of the relevant part of the Loan the relevant Borrower shall be released from its obligations under this Agreement if as a result of such prepayment the full amount of the relevant Tranche and Revolving Facility is repaid in full.
If the remaining FSO is sold or becomes a Total Loss, the Borrowers or remaining Borrower shall prepay the full amount of the Loan.
8.11
Mandatory prepayment on termination of Service Contract
(a)
The Borrowers shall be obliged to prepay the relevant part of the Loan and the Revolving Commitment in respect of the Revolving Facility relating to an FSO shall terminate if the Service Contract in relation to that FSO is terminated (including, for the avoidance of doubt, cancellation for convenience or war).
(b)
In addition, the Borrowers shall be obliged to prepay the full amount of the Loan and the Revolving Commitments shall terminate if both Service Contracts are terminated (including, for the avoidance of doubt, cancellation for convenience or war).
8.12
Mandatory prepayment on Change of Control
(a)
If there is a Change of Control, the Borrowers shall be obliged to prepay the Loan not later than 60 days following the occurrence of the Change of Control unless the Agent has approved the Change of Control (acting with the authorisation of the Majority Lenders, which authorisation shall not be unreasonably withheld or delayed and shall only be withheld if there is a valid and reasonable concern on the part of the Lenders as to the financial position of the person in control after the Change of Control or the identity of such person).
(b)
If a Change in Ultimate Beneficial Owner occurs after the date of this Agreement and (i) a Lender has not been able to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks in respect of the Ultimate Beneficial Owner under all anti-money laundering or anti-terrorism financing laws and regulations applicable to it, or (ii) the Ultimate Beneficial Owner is not acceptable to that Lender because that person is identified in the Sanctions Laws or been engaged in activities in violation of applicable law, that Lender may notify the Agent. Upon the Agent notifying the Borrowers:
(i)
the Available Commitments of that Lender will be immediately cancelled; and
(ii)
that Lender's participation in the Loan, together with all accrued interest and other amounts accrued or outstanding under the Finance Documents will be immediately due and payable.

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8.13
Amounts payable on prepayment
A prepayment shall be made together with accrued interest (and any other amount payable under Clause 20 ( Indemnities ) or otherwise) in respect of the amount prepaid and, if the prepayment is not made on the last day of an Interest Period together with any sums payable under paragraph (b) of Clause 20.1 ( Indemnities regarding borrowing and repayment of Loan ) but without premium or penalty.
8.14
Application of partial prepayment
Each partial voluntary prepayment shall be applied pro rata against each Tranche and then pro rata against the repayment instalments (including the balloon) specified in Clause 8.1 ( Amount of repayment instalments ).
8.15
Reborrowing
(a)
The Borrowers may not reborrow any part of the Term Facility which is repaid.
(b)
Unless a contrary indication appears in this Agreement, any part of a Revolving Facility which is repaid may be reborrowed in accordance with the terms of this Agreement.
8.16
Hedging and Unwinding of Designated Transactions
(a)
The Borrowers shall offer the Swap Banks the right of first refusal on competitive terms before entering into any interest rate swap or interest rate cap transactions.
(b)
The aggregate notional amount of the Designated Transaction in respect of the Master Agreements shall be at least 75 per cent. and no more than 100 per cent. of the Loan (such minimum percentage to be discussed by the Borrowers with the Lenders in good faith if the Revolving Facility is utilised).
(c)
Neither a Swap Bank nor a Borrower may amend, supplement, extend or waive the terms of any Master Agreement without the consent of the Agent.
(d)
Paragraph (c) above shall not apply to an amendment, supplement or waiver that is administrative and mechanical in nature and does not give rise to a conflict with any provision of this Agreement or any Master Agreement Assignment.
(e)
On or prior to any repayment or prepayment of the Loan under this Clause 8 ( Repayment, prepayment and cancellation ) or any other provision of this Agreement:
(i)
the Borrowers shall; or
(ii)
where the Borrowers fail to do so, the Swap Banks may, acting on the Borrowers' behalf:
wholly or partially unwind or otherwise terminate one or more of the continuing Designated Transactions so that the aggregate notional amount of the continuing Designated Transactions thereafter remaining does not and will not in the future (taking into account the scheduled amortisation) exceed the amount of the Loan as reducing from time to time thereafter pursuant to Clause 8.1 ( Amount of repayment instalments ).
(f)
Neither a Swap Bank nor any Borrower may terminate or close out any Transactions in respect of any Master Agreement (in whole or in part) except:

39     



(i)
in accordance with paragraph (e) above;
(ii)
on the occurrence of an Illegality, Tax Event, Tax Event Upon Merger or a Force Majeure Event (as such expressions are defined in the relevant Master Agreement);
(iii)
on the occurrence of any of the events described in paragraph (g) of Clause 18.1 ( Events of Default ) in relation to a Borrower;
(iv)
in the case of termination or closing out by a Swap Bank, if the Agent serves notice under paragraph (a)(ii) of Clause 18.2 ( Actions following an Event of Default );
(v)
in the case of any other termination or closing out by a Swap Bank or a Borrower, with the consent of the Agent; or
(vi)
if the Secured Liabilities (other than in respect of the Master Agreements) have been irrevocably and unconditionally paid and discharged in full;
(g)
If a Swap Bank or a Borrower terminates or closes out a Transaction in respect of a Master Agreement (in whole or in part) in accordance with paragraphs (f)(ii), (f)(iii) or (in the case of a Swap Bank only) (f)(v) above, it shall promptly notify the Agent of that termination or close out.
(h)
If a Swap Bank is entitled to terminate or close out any Transaction in respect of any Master Agreement under sub-paragraph (iv) of paragraph (f) above, such Swap Bank shall promptly terminate or close out such Transaction following a request to do so by the Security Agent.
(i)
A Swap Bank may only suspend making payments under a Transaction in respect of a Master Agreement if a Borrower is in breach of its payment obligations under any Transaction in respect of that Master Agreement.
9
CONDITIONS PRECEDENT
9.1
Documents, fees and no default
Each Lender's obligation to contribute to an Advance is subject to the following conditions precedent:
(a)
that, on or before the service of the first Drawdown Notice, the Agent receives the documents described in Part A of Schedule 5 ( Condition Precedent Documents ) in form and substance satisfactory to the Agent and its lawyers;
(b)
that, on the first Drawdown Date but prior to the making of the first Advance, the Agent receives or is satisfied that it will receive on the making of the first Advance the documents described in Schedule 5 ( Condition Precedent Documents ) in form and substance satisfactory to it and its lawyers;
(c)
that, on or before the service of the first Drawdown Notice, the Agent receives the arrangement fee referred to in Clause 19.1 ( Arrangement, commitment, agency fees ), all accrued commitment fee payable pursuant to Clause 19.1 ( Arrangement, commitment, agency fees ) and the first instalment of the annual agency fee referred to in Clause 19.1 ( Arrangement, commitment, agency fees );
(d)
that both at the date of each Drawdown Notice and at each Drawdown Date:

40     



(i)
no Default has occurred and is continuing or would result from the borrowing of the Advance;
(ii)
the representations and warranties in Clause 10.1 ( General ) and those of any Borrower or any Security Party which are set out in the other Finance Documents would be true and not misleading if repeated on each of those dates with reference to the circumstances then existing;
(iii)
none of the circumstances contemplated by Clause 5.9 ( Market disruption ) has occurred and is continuing;
(iv)
no event or circumstance is outstanding which might have a Material Adverse Effect;
(v)
the Borrowers are and, following the making of the Advance shall be, in compliance with the financial covenants in Clause 12.5 ( Financial covenants ) and each Guarantor is and, following the making of the Advance shall be, in compliance with any financial covenants in the Guarantee to which it is a party; and
(e)
that the Agent has received, and found to be acceptable to it, any further opinions, consents, agreements and documents in connection with the Finance Documents which the Agent may, with the authorisation of the Majority Lenders, reasonably request by notice to the Borrowers at least 3 Business Days prior to the Drawdown Date.
9.2
Waiver of conditions precedent
If the Majority Lenders, at their discretion, permit an Advance to be borrowed before certain of the conditions referred to in Clause 9.1 ( Document, fees and no default ) are satisfied, the Borrowers shall ensure that those conditions are satisfied within 5 Business Days after the Drawdown Date (or such longer period as the Agent may, with the authorisation of the Majority Lenders, specify).
10
REPRESENTATIONS AND WARRANTIES
10.1
General
Each Borrower represents and warrants to each Creditor Party as follows.
10.2
Status
Each Borrower is a limited liability company, duly incorporated and validly existing under the laws of Hong Kong.
10.3
Share capital and ownership
Each Borrower has an issued share capital of $2.00 divided into 2 shares of $1.00 each, all of which are fully paid up and the legal title and beneficial ownership of all those shares is held, free of any Security Interest or other claim (including without limitation options to purchase and pre-emption rights) (except such Security Interest or other claim which has been created pursuant to the Finance Documents), as to 1 such share owned by Euronav Hong Kong Limited, a subsidiary of Euronav, and as to 1 such share owned by Africa Tanker Corporation, a subsidiary of International Seaways.
10.4
Corporate power

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Each Borrower has the corporate capacity, and has taken all corporate action and obtained all consents necessary for it:
(a)
to register the FSO in its name under the Approved Flag;
(b)
to execute the Service Contract to which it is a party;
(c)
to execute the Finance Documents to which that Borrower is a party and the Master Agreements; and
(d)
to borrow under this Agreement, to enter into Designated Transactions under the Master Agreements and to make all the payments contemplated by, and to comply with, those Finance Documents to which that Borrower is a party and the Master Agreements.
10.5
Consents in force
All the consents referred to in Clause 10.4 ( Corporate power ) remain in force and nothing has occurred which makes any of them liable to revocation.
10.6
Legal validity; effective Security Interests
The Finance Documents to which each Borrower is a party and the Master Agreements, do now or, as the case may be, will, upon execution and delivery (and, where applicable, registration as provided for in the Finance Documents):
(a)
constitute that Borrower's legal, valid and binding obligations enforceable against that Borrower in accordance with their respective terms; and
(b)
create legal, valid and binding Security Interests enforceable in accordance with their respective terms over all the assets to which they, by their terms, relate,
subject to any relevant insolvency laws affecting creditors' rights generally.
10.7
No third party Security Interests
Without limiting the generality of Clause 10.6 ( Legal validity; effective Security Interests ), at the time of the execution and delivery of each Finance Document:
(a)
each Borrower which is a party to that Finance Document will have the right to create all the Security Interests which that Finance Document purports to create; and
(b)
no third party will have any Security Interest (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.
10.8
No conflicts
The execution by each Borrower of each Finance Document to which it is a party and the Master Agreements, and the borrowing by that Borrower of the Loan, and its compliance with each Finance Document to which it is a party and each Master Agreement will not involve or lead to a contravention of:
(a)
any law or regulation; or
(b)
the constitutional documents of that Borrower; or

42     



(c)
any contractual or other obligation or restriction which is binding on that Borrower or any of its assets.
10.9
No withholding taxes
All payments which each Borrower is liable to make under the Finance Documents to which it is a party may be made without deduction or withholding for or on account of any tax payable under any law of any Pertinent Jurisdiction other than FACTA Deductions, if applicable, in accordance with Clause 21.9 ( FATCA Deduction ).
10.10
No default
No Event of Default or Potential Event of Default has occurred and is continuing.
10.11
Information
All information which has been provided by or on behalf of the Borrowers or any Security Party to any Creditor Party in connection with any Finance Document satisfied the requirements of Clause 11.5 ( Information provided to be accurate ); all audited and unaudited accounts which have been so provided satisfied the requirements of Clause 11.8 ( Form of financial statements ); and there has been no material adverse change in the financial position or state of affairs of any Borrower from that disclosed in the latest of those accounts.
10.12
No litigation
No legal or administrative action involving any Borrower (including action relating to any alleged or actual breach of the ISM Code or the ISPS Code) has been commenced or taken or, to any Borrower's knowledge, is likely to be commenced or taken which, in either case, would be likely to have a material adverse effect on any Borrower's ability to perform its obligations under the Finance Documents.
10.13
Validity and completeness of Service Contracts
Each of the Service Contracts constitutes valid, binding and enforceable obligations of the parties thereto in accordance with its terms and:
(a)
the copy of each of the Service Contracts delivered to the Agent before the date of this Agreement is a true and complete copy; and
(b)
no amendments or additions to any of the Service Contracts have been agreed nor has any parties thereto waived any of their respective rights under such documents.
10.14
Compliance with certain undertakings
At the date of this Agreement, the Borrowers are in compliance with Clauses 11.2 (Title; negative pledge), 11.4 ( No other liabilities or obligations to be incurred ), 11.10 ( Consent ), 11.14 ( Principal place of business ), 11.22 ( Compliance with Sanctions Laws ) and 14.9 ( Compliance with laws, etc. ).
10.15
Taxes paid
Each Borrower has paid all taxes applicable to, or imposed on or in relation to that Borrower, its business or the FSO owned by it.

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10.16
ISM Code and ISPS Code compliance
All requirements of the ISM Code and the ISPS Code as they relate to the Borrowers, the Approved Manager and the FSOs have been complied with.
10.17
No money laundering
Without prejudice to the generality of Clause 2.3 ( Purpose of Advances ), in relation to the borrowing by the Borrowers of the Loan, the performance and discharge of their obligations and liabilities under the Finance Documents, and the transactions and other arrangements affected or contemplated by the Finance Documents to which a Borrower is a party, the Borrowers confirm (i) that they are acting for their own account; (ii) that they will use the proceeds of the Loan for their own benefit, under their full responsibility and exclusively for the purposes specified in this Agreement; and (iii) that the foregoing will not involve or lead to a contravention of any law, official requirement or other regulatory measure or procedure implemented to combat "money laundering" (as defined in Article 1 of the Directive (2015/849/EC) of the European Parliament and of the Council).
10.18
No Material Adverse Effect
No event or circumstance is outstanding which might have a Material Adverse Effect.
10.19
Anti-Corruption Laws
Each Borrower has conducted its business in compliance with all applicable Anti-Corruption Laws and has instituted and maintained policies and procedures designed to promote and achieve compliance with such laws.
10.20
Sanctions
Each Sanctions Relevant Person has been and is in compliance with all Sanctions Laws and no Relevant Person:
(a)
is a Restricted Party, or is involved in any transaction through which it is likely to become a Restricted Party; or
(b)
has received formal notice in writing of any inquiry, claim, action, suit, proceeding or investigation against it with respect to Sanctions Laws.
10.21
Insolvency
No corporate action, legal proceeding or other procedure or step described in paragraph (g) of Clause 18.1 ( Events of Default ) has been taken or, to its knowledge, threatened in relation to the Borrower which would be likely to have a material adverse effect on the property, assets, nature of assets, operations, liabilities or condition (financial or otherwise) of the Borrower and its subsidiaries or on the ability of the Borrower to perform its obligations under the Finance Documents.
11
GENERAL UNDERTAKINGS
11.1
General
Each Borrower undertakes with each Creditor Party to comply with the following provisions of this Clause 11 ( General Undertakings ) at all times during the Security Period except as the Agent

44     



may, with the authorisation of the Majority Lenders, otherwise permit (such permission not to be unreasonably withheld or delayed in the case of Clause 11.13 ( No amendment to Service Contracts )).
11.2
Title; negative pledge
Each Borrower will:
(a)
hold the legal title to, and own the entire beneficial interest in the FSO owned by it, its Insurances and Earnings and the Service Contract Rights in relation to that FSO, 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 and except for Permitted Security Interests; and
(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
No Borrower will transfer, lease or otherwise dispose of:
(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)
No Borrower will incur any liability or obligation except liabilities and obligations under the Service Contracts to which it is a party and liabilities or obligations incurred in respect of Permitted Financial Indebtedness or in the ordinary course of operating and chartering the FSO owned by it.
(b)
The Borrowers will not incur any Financial Indebtedness except for Permitted Financial Indebtedness.
11.5
Information provided to be accurate
All financial and other information which is provided in writing by or on behalf of a Borrower under or in connection with any Finance Document will be true and not misleading and will not omit any material fact or consideration.
11.6
Provision of financial statements
Each Borrower will send to the Agent:
(a)
as soon as possible, but in no event later than 180 days after the end of each financial year of that Borrower, the audited accounts of that Borrower;
(b)
as soon as possible, but in no event later than 60 days after the end of each financial year of that Borrower, a budget in the form attached as Schedule 10 which shows all anticipated income and expenditure of the FSO owned by it during the next financial year of that Borrower; and

45     



(c)
the Borrowers shall also use best commercial efforts to procure that the Agent is sent as soon as possible, but in no event later than 180 days after the end of each financial year of NOC, the audited accounts of NOC.
11.7
Compliance Certificate
(a)
Each Borrower shall supply to the Facility Agent, with each set of financial statements delivered pursuant paragraph (a) of Clause 11.6 ( Provision of financial statements ) in relation to it, a Compliance Certificate.
(b)
Each Compliance Certificate shall be signed by two directors of the relevant Borrower.
(c)
Together with each Compliance Certificate, the Borrower providing that Compliance Certificate shall, at the Borrowers cost, provide the Facility Agent with a valuation of the FSOs, from an Approved Valuer, to enable the Facility Agent to determine the Market Value of the FSOs on the date of that Compliance Certificate.
11.8
Form of financial statements
All accounts (audited and unaudited) delivered under paragraph (a) of Clause 11.6 ( Provision of financial statements ) will:
(a)
be prepared in accordance with all applicable laws and IFRS consistently applied;
(b)
give a true and fair view of the state of affairs of the relevant Borrower at the date of those accounts and of its profit for the period to which those accounts relate; and
(c)
fully disclose or provide for all significant liabilities of the relevant Borrower.
11.9
Creditor notices
Each Borrower will send the Agent, at the same time as they are despatched, copies of all material communications which are despatched to that Borrower's creditors or any class of them.
11.10
Consents
Each Borrower will maintain in force and promptly obtain or renew, and, if so requested, will promptly send certified copies to the Agent of, all consents required:
(a)
for that Borrower to perform its obligations under the Service Contract, any Finance Document to which it is a party and any Master Agreement;
(b)
for the validity or enforceability of the Service Contract and any Finance Document to which it is a party and any Master Agreement;
(c)
for that Borrower to continue to own and operate the FSO owned by it,
and that Borrower will comply with the terms of all such consents.
11.11
Maintenance of Security Interests
Each Borrower will:
(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

46     



(b)
without limiting the generality of paragraph (a), at its own cost, promptly register, file, record or enrol any Finance Document with any court or authority in all Pertinent Jurisdictions, pay any stamp, registration or similar tax in all Pertinent Jurisdictions in respect of any Finance Document, give any notice or take any other step which, in the opinion of the Majority Lenders, is 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.
11.12
Notification of litigation
Each Borrower will provide the Agent with details of any legal or administrative action involving that Borrower, any Security Party, the Approved Manager or the FSO owned by it, the Earnings, the Insurances, the Service Contracts or the Project 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.
11.13
No amendment to Service Contracts
No Borrower will agree to any material amendment or supplement to, or waive or fail to enforce, the Service Contract to which it is a party or any of its provisions.
11.14
Principal place of business
Each Borrower will maintain its place of business, and keep its corporate documents and records, at either its registered address or the address of its parent; and no Borrower will establish, or do anything as a result of which it would be deemed to have, a place of business in any country other than its place of incorporation.
11.15
Confirmation of no default
Each Borrower will, within 5 Business Days after service by the Agent of a written request, serve on the Agent a notice which is signed by 2 directors of that Borrower and which:
(a)
states that no Event of Default or Potential Event of Default has occurred and is continuing; 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.
The Agent may serve requests under this Clause 11.15 ( Confirmation of no default ) from time to time but only if asked to do so by a Lender or Lenders having Contributions exceeding 10 per cent. of the Loan or (if no Advances have been made) Commitments exceeding 10 per cent. of the Total Commitments; and this Clause 11.15 ( Confirmation of no default ) does not affect the Borrowers' obligations under Clause 11.16 ( Notification of default ).
11.16
Notification of default
Each Borrower will notify the Agent as soon as that Borrower becomes aware of the occurrence of a Default and will keep the Agent fully up‑to‑date with all developments.
11.17
Provision of further information
Each Borrower will, as soon as practicable after receiving the request, provide the Agent with any additional financial or other information relating:
(a)
to that Borrower, the FSO owned by it, the Earnings or the Insurances; or

47     



(b)
to the Service Contracts and any action by NOC under or on connection with the Service Contracts; or
(c)
to any other matter relevant to, or to any provision of, a Finance Document or the Project,
which may be reasonably requested by the Agent, the Security Trustee or any Lender at any time.
11.18
"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 a Borrower or any Security Party (or of a holding company of any of them) or the composition of the shareholders of a Borrower or any Security Party (or of a holding company of any of them) or any person becomes the owner of 25 per cent. or more of the issued share capital of a Borrower or any Security Party (or of a holding company of any of them) after the date of this Agreement; or
(iii)
a proposed assignment or transfer by a Lender of any of its rights and/or obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer; or
(iv)
any anti-money laundering or anti-terrorism financing laws and regulations applicable to the Agent or any Lender,
obliges the Agent or any Lender (or, in the case of paragraph (iii) above, any prospective new Lender) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, each Obligor shall promptly upon the request of the Agent or any Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Agent (for itself or on behalf of any Lender) or any Lender (for itself or, in the case of the event described in paragraph (iii) above, on behalf of any prospective new Lender) in order for the Agent, such Lender or, in the case of the event described in paragraph (iii) above, any prospective new Lender 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.
(b)
Each Lender shall promptly upon the request of the Agent supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Agent (for itself) in order for the Agent 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.
(c)
The Borrowers shall, promptly upon becoming aware of any Change in Ultimate Beneficial Owner, the name of the Ultimate Beneficial Owner and such documentation and other evidence as is reasonably requested by the Agent, the Security Trustee or any Lender in order for the Agent, the Security Trustee or such Lender 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 in relation to the Ultimate Beneficial Owner.
11.19
No amendment to Master Agreements

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The Borrowers will not agree to any amendment or supplement to, or waive or fail to enforce, any Master Agreement or any of its provisions.
11.20
Taxation
Each Borrower shall 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:
(a)
such payment is being contested in good faith;
(b)
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 Agent under Clause 11.6 ( Provision of financial statements ); and
(c)
such payment can be lawfully withheld and failure to pay those taxes does not have or is not reasonably likely to have a Material Adverse Effect.
11.21
Material Adverse Effect
The Borrowers shall promptly give the Agent notice of any event or circumstance which occurs which has or is reasonably likely to have a Material Adverse Effect and of which a Borrower has knowledge.
11.22
Compliance with Sanctions Laws
The Borrower shall:
(a)
ensure that neither it, nor any Guarantor nor any of their respective subsidiaries is or will become a Restricted Party;
(b)
use reasonable endeavours to procure that no director, officer, employee, agent or representative of it or any Guarantor or any of their respective subsidiaries is or will become a Restricted Party; and
(c)
procure that no proceeds of any Tranche shall be made available, directly or indirectly, to or for the benefit of a Restricted Party nor shall they otherwise be applied in a manner for a purpose prohibited by Sanctions Laws.
12
CORPORATE UNDERTAKINGS
12.1
General
Each Borrower also undertakes with each Creditor Party to comply with the following provisions of this Clause 12 ( Corporate Undertakings ) at all times during the Security Period except as the Agent may, with the authorisation of the Majority Lenders, otherwise permit.
12.2
Maintenance of status
Each Borrower will maintain its separate corporate existence as a limited liability company, duly incorporated and validly existing under the laws of Hong Kong.
12.3
Negative undertakings
No Borrower will:

49     



(a)
carry on any business other than the ownership, chartering and operation of the FSO owned by it; or
(b)
pay any dividend or make any other form of distribution or effect any form of redemption, purchase or return of share capital Provided that the Borrowers may pay a dividend or make a distribution subject to the following conditions:
(i)
the Borrowers are in compliance with the covenants and undertakings in this Agreement and no Event of Default has occurred and is continuing or would result from the payment of such dividend;
(ii)
no force majeure event has occurred and is continuing under a Service Contract with no force majeure rates payable under a Service Contract;
(iii)
the rate payable under a Service Contract has not remained unpaid for a consecutive period of 30 days or more;
(iv)
neither FSO has been off hire under the relevant Service Contract for 30 days or more in any 90 day period (disregarding any off hire permissible under the relevant Service Contract for scheduled maintenance provided no Default has occurred and is continuing);
(v)
no Dividend Lock-Up Event has occurred;
except that so long as no Default has occurred and is continuing or would result from the payment thereof, the Borrowers may pay dividends free of the conditions set forth in subparagraphs (i) to (v) if such dividends are paid to the Shareholders solely out of proceeds received pursuant to refunded retention taxes withheld by Maersk Oil Qatar under the laws of Qatar under service contracts between the Borrowers and Maersk Oil Qatar concluded prior to the date of this Agreement.
(c)
repay any Subordinated Liabilities other than in accordance with the Subordination Agreements;
(d)
provide any form of credit or financial assistance 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,
or enter into any transaction with or involving such a person or company 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;
(e)
other than share issuances to Shareholders in accordance with the terms of the Finance Documents and debt securities issued to a Shareholder and subject to subordination provisions acceptable to the Agent acting on the instructions of the Majority Lenders, issue, allot or grant any person a right to any shares in its capital or repurchase or reduce its issued share capital except as otherwise permitted hereunder;
(f)
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 with a minimum Standard and Poor's rating of AA-, or enter into any transaction in a derivative other than Designated Transactions; or

50     



(g)
enter into any form of amalgamation, merger or de-merger or any form of reconstruction or reorganisation.
12.4
Transfer of ownership
Each Borrower shall procure that there is no change of direct ownership of any of its share capital without the consent of the Agent, acting with the authorisation of the Lenders, such authorisation not to be withheld where:
(a)
the transfer of ownership is to Euronav, International Seaways or a subsidiary of either of them; and
(b)
the new shareholder has executed and delivered to the Agent a deed creating security over the shares of the relevant Borrower in favour of the Security Trustee in Agreed Form and each document required to be delivered by it.
12.5
Financial Covenants
(a)
Each Borrower will ensure that its financial position shall at all times during the Security Period be such that the Debt Service Cover Ratio in respect of it shall be equal or greater than 1.1x, such ratio to be tested on the last day of each financial quarter of each of the relevant Borrower's financial years.
(b)
For the purposes of this Clause 12.5 ( Financial covenants ):
" EBITDA " means, at any date of determination under this Agreement, the operating profit of the relevant Borrower, on ordinary activities for the relevant financial period determined on a consolidated basis in accordance with the accounting principles applied in preparation of the latest accounts:
(i)
plus, to the extent deducted in computing such operating profit of that Borrower's the sum, without duplication, of depreciation, depletion, amortisation of intangibles, income taxes and other non-cash charges or non-cash losses (including non-cash transaction expenses and amortisation of debt discounts);
(ii)
minus, to the extent added in computing such operating profit of that Borrower's, any interest income, non-cash income or non-cash gains,
all as determined in accordance with IFRS.
12.6
Notification of Sanctions
Each Borrower shall:
(a)
supply to the Agent, promptly upon becoming aware of them, the details of any inquiry, claim, action, suit, proceeding or investigation pursuant to Sanction Laws against (a) the Borrower, (b) any other Relevant Person or (c) any owners of any Relevant Person (other than any owner of that Borrower), as well as information on what steps are being taken with regards to answering or opposing the same;
(b)
inform the Agent promptly upon becoming aware that any of (a) that Borrower, (b) any other Relevant Person or (c) any owners of any Relevant Person (other than any owner of that Borrower), has become or is likely to become a Restricted Party.

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13
INSURANCE
13.1
General
Each Borrower also undertakes with each Creditor Party to comply with the following provisions of this Clause 13 ( Insurance ) at all times during the Security Period except as the Agent may, with the authorisation of the Majority Lenders, otherwise permit.
13.2
Maintenance of obligatory insurances
Each Borrower shall keep the FSO owned by it insured at the expense of that Borrower against:
(a)
fire and usual marine risks (including hull and machinery and excess risks);
(b)
war risks;
(c)
protection and indemnity risks; and
13.3
Terms of obligatory insurances
Each Borrower shall effect such 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) when aggregated with such insurances of the other FSO 125 per cent. of the Total Commitments and (ii) the market value of the FSO owned by it;
(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;
(d)
in relation to protection and indemnity risks in respect of the full tonnage of the FSO owned by it;
(e)
on approved terms;
(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 (the following insurance brokers being pre-approved: JLT Belgibo, of De Gerlachekaai 20, 2000 Antwerp, Belgium and Proteus RS NV, of Suikerrui 5, 2000 Antwerp, Belgium); and
(g)
so as to comply with the requirements of the Service Contract for the FSO.
13.4
Further protections for the Creditor Parties
In addition to the terms set out in Clause 13.3 ( Terms of obligatory insurances ), each Borrower shall procure that the obligatory insurances shall:
(a)
in relation to the obligatory insurances for hire and usual marine risks and war risks, whenever the Security Trustee requires, name (or be amended to name) the Security Trustee as additional named assured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation against the Security Trustee, but without the Security Trustee thereby

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being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
(b)
name the Security Trustee as loss payee with such directions for payment as the Security Trustee may specify;
(c)
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Security Trustee shall be made without set‑off, counterclaim or deductions or condition whatsoever;
(d)
provide that such obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Security Trustee or any other Creditor Party; and
(e)
provide that the Security Trustee may make proof of loss if the Borrowers fail to do so.
13.5
Renewals
The Borrowers shall ensure that:
(a)
before the expiry of any obligatory insurance, that obligatory insurance is renewed; and
(b)
promptly after each such renewal, there is provided to the Security Trustee details of the terms and conditions on which such obligatory insurances have been renewed.
If there is a change in the insurers and/or markets through whom the obligatory insurances are placed the Borrowers shall procure that the Security Trustee is notified within a reasonable time of the names of the insurers and/or markets employed for the purposes of the renewal of the obligatory insurance and of the amounts in which they are renewed.
13.6
Letters of undertaking
In relation to all obligatory insurances effected from time to time under Clause 13.2 ( Maintenance of obligatory insurances ), the Borrowers shall ensure that all brokers and any protection and indemnity or war risks associations in which a FSO is entered, in each case being approved by the Security Trustee, provide the Security Trustee with letters of undertaking:
(a)
in the case of a broker, in a form standard in the insurance market in which such broker operates or any professional association of which that approved broker is a member;
(b)
in the case of a protection and indemnity or war risks association, in its standard form.
If any of the obligatory insurances referred to in paragraph (a) and/or (b) of Clause 13.2 ( Maintenance of obligatory insurances ) form part of a fleet cover, the Borrowers will procure that any letter of undertaking referred to in paragraph (a) of this Clause 13.6 ( Letters of undertaking ) is amended to provide that the relevant brokers shall undertake to the Security Trustee that they shall neither set-off against any claims in respect of the relevant FSO any premiums due in respect of other vessels under such fleet cover or any premiums due for other insurances, nor cancel the insurance for reason of non-payment of premiums for other vessels under such fleet cover or of premiums for such other insurances.
13.7
Copies of certificates of entry
Each Borrower shall ensure that any protection and indemnity and/or war risks associations in which the FSO owned by it is entered provides the Security Trustee with:

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(a)
a certified copy of the certificate of entry for that FSO; and
(b)
a letter or letters of undertaking in such form as may be required by the Security Trustee.
13.8
Deposit of original policies
Each Borrower shall ensure that all policies relating to obligatory insurances effected by it are deposited with the approved brokers through which the insurances are effected or renewed.
13.9
Payment of premiums
Each Borrower shall punctually pay all premiums or other sums payable in respect of the obligatory insurances effected by it and produce all relevant receipts when so required by the Security Trustee.
13.10
Guarantees
Each Borrower shall ensure that any guarantees required by a protection and indemnity or war risks association are promptly issued and remain in full force and effect.
13.11
Compliance with terms of insurances
No Borrower shall do nor 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; and, in particular:
(a)
each Borrower shall 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 Security Trustee has not given its prior approval;
(b)
no Borrower shall make any changes relating to the classification or classification society or manager or operator of the FSO owned by it approved by the underwriters of the obligatory insurances Provided that a Borrower may change the classification society of the FSO owned by it subject to the prior written consent of the Agent acting with the authorisation of the Majority Lenders (such consent not to be unreasonably withheld or delayed) and Provided that no consent of the Agent shall be required if the change of manager or operator result in Euronav or International Seaways or any of their Affiliates becoming the manager or operator of both FSOs; and
(c)
no Borrower shall employ the FSO 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.
13.12
Alteration to terms of insurances
The Borrowers shall procure that:
(a)
no adverse alteration is made to any obligatory insurance (which alteration is, in the reasonable opinion of the Security Trustee, likely to materially adversely affect the Lenders) without the prior written consent of the Security Trustee; and

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(b)
all the steps under its control are taken to seek to avoid the occurrence of any act or omission which would enable cancellation of any obligatory insurance or render any obligatory insurance invalid, void or unenforceable or render any sum paid out under any obligatory insurance repayable in whole or in part.
13.13
Settlement of claims
No Borrower shall settle, compromise or abandon any claim under any obligatory insurance for Total Loss or for a Major Casualty, and shall do all things necessary and provide all documents, evidence and information to enable the Security Trustee to collect or recover any moneys which at any time become payable in respect of the obligatory insurances.
13.14
Provision of copies of communications
Promptly after a request of the Agent (acting reasonably), each Borrower shall provide the Security Trustee, at the time of each such communication, copies of all written communications between that Borrower and:
(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; and
(ii)
any credit arrangements made between that Borrower and any of the persons referred to in paragraphs (a) or (b) relating wholly or partly to the effecting or maintenance of the obligatory insurances.
13.15
Provision of information
Each Borrower shall promptly provide the Security Trustee (or any persons which it may designate) with any information which the Security Trustee (or any such designated person) reasonably requests for the purpose of:
(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 13.16 ( Mortgagee's interest and additional perils insurances ) or dealing with or considering any matters relating to any such insurances,
and the Borrowers shall, forthwith upon demand, indemnify the Security Trustee in respect of all fees and other expenses reasonably incurred by or for the account of the Security Trustee in connection with any such report as is referred to in paragraph (a).
13.16
Mortgagee's interest and additional perils insurances
The Security Trustee shall maintain and renew a mortgagee's interest additional perils insurance and a mortgagee's interest marine insurance in such amounts, on such terms, through such insurers and generally in such manner as the Security Trustee may from time to time consider appropriate and the Borrowers shall upon demand fully indemnify the Agent or Security Trustee (as the case

55     



may be) in respect of all premiums and other expenses which are incurred in connection with or with a view to effecting, maintaining or renewing any such insurance or dealing with, or considering, any matter arising out of any such insurance.
Notwithstanding the above, if at any time the Agent or Security Trustee proposes to effect any insurances of the nature referred to in this Clause, it shall first notify the Borrowers of the insurance which it proposes to effect, the terms on which it requires it to be effected and the date from which it requires it to be so effected. If, before the date on which the Agent or Security Trustee (as the case may be) requires that insurance to be effected, the Borrowers can demonstrate to the Agent or Security Trustee (as the case may be) that a firm of insurance brokers with a reputation acceptable to the Agent or the Security Trustee (as the case may be) is able to arrange that insurance upon the same terms, before that date, for a price lower than that for which any firm of insurance brokers nominated by the Agent or Security Trustee is prepared to arrange that insurance and with underwriters acceptable to the Agent or Security Trustee (as the case may be), and if that firm of insurance brokers will enter into such agreements with the Agent or Security Trustee (as the case may be) as it may require taking into account the identity of that firm of insurance brokers, the Agent or Security Trustee (as the case may be) shall not unreasonably refuse to effect that insurance through that firm of insurance brokers so nominated by the Borrowers.
14
FSO COVENANTS
14.1
General
Each Borrower also undertakes with each Creditor Party to comply with the following provisions of this Clause 14 ( FSO Covenants ) at all times during the Security Period except as the Agent, with the authorisation of the Majority Lenders, may otherwise permit (such permission not to be unreasonably withheld or delayed in the case of Clause 14.14 ( Sharing of Earnings )).
14.2
FSO's name and registration
Each Borrower shall keep the FSO owned by it registered in its name under the Approved Flag; shall not do, omit to do or allow to be done anything as a result of which such registration might be cancelled or imperilled; and shall not change the name or port of registry of the FSO during its period of ownership by that Borrower.
14.3
Repair and classification
Each Borrower shall keep the FSO owned by it in a good and safe condition and state of repair:
(a)
consistent with first-class ship ownership and management practice;
(b)
so as to maintain that FSO's class as referred to in the relevant Service Contract (namely segregated ballast tanks Floating, Storage and Offloading Facility with class notation +A1 (SBT) (FSO) (DH) (S)20 with America Bureau of Shipping, Lloyd's Register, Bureau Veritas or Det Norske Veritas) free of overdue recommendations and conditions affecting that FSO's class; and
(c)
so as to comply with all laws and regulations applicable to vessels registered at ports in the Approved Flag or to vessels operating or trading to any jurisdiction to which that FSO may trade from time to time, including but not limited to the ISM Code and the ISPS Code.
14.4
Modification
Neither Borrower shall make any modification or repairs to, or replacement of, any FSO or equipment installed on it which would or might materially alter the structure, type or performance

56     



characteristics of that FSO or materially reduce its value unless so requested by NOC in accordance with the terms of the Service Contracts.
14.5
Removal of parts
Unless so requested by NOC in accordance with the terms of the Service Contracts, no Borrower shall remove any material part of any FSO, or any item of equipment installed on, any FSO unless 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, is free from any Security Interest or any right in favour of any person other than the Security Trustee and becomes on installation on the relevant FSO the property of the relevant Borrower and subject to the security constituted by the relevant Mortgage Provided that a Borrower may install equipment owned by a third party if the equipment can be removed without any risk of damage to the FSO owned by it.
14.6
Surveys
Each Borrower shall submit the FSO owned by it regularly to all periodical or other surveys which may be required for classification purposes and shall comply with all conditions and recommendations affecting that FSO's class of the relevant classification society in accordance with their terms unless waived.
14.7
Inspection
Each Borrower shall permit the Security Trustee (by surveyors or other persons appointed by it for that purpose, at the Borrowers' expense once a year and after reasonable notice to the Borrowers) to board the FSO owned by it at all reasonable times to inspect its condition (without interfering with that FSO's operation) or to satisfy themselves about proposed or executed repairs and shall afford all proper facilities for such inspections.
14.8
Prevention of and release from arrest
Each Borrower shall promptly discharge:
(a)
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against the FSO owned by it, the Earnings or the Insurances;
(b)
all taxes, dues and other amounts charged in respect of the FSO owned by it, the Earnings or the Insurances; and
(c)
all other outgoings whatsoever in respect of the FSO owned by it, the Earnings or the Insurances,
and, forthwith upon receiving notice of the arrest of the FSO owned by it, or of its detention in exercise or purported exercise of any lien or claim, that Borrower shall procure its release by providing bail or otherwise as the circumstances may require.
14.9
Compliance with laws etc
Each Borrower shall:
(a)
comply, or procure compliance with the ISM Code, the ISPS Code, all Environmental Laws, all Sanctions Laws and all other laws or regulations relating to the FSO owned by it, its ownership, operation and management or to the business of that Borrower;

57     



(b)
not employ the FSO owned by it nor allow its employment in any manner contrary to any law or regulation in any relevant jurisdiction including but not limited to the ISM Code, the ISPS Code, all Environmental Laws and all Sanctions Laws; and
(c)
in the event of hostilities in any part of the world (whether war is declared or not), not cause or permit the FSO owned by it to enter or trade to any zone which is declared a war zone by any government or by the FSOs war risks insurers unless that Borrower has (at its expense) effected any special, additional or modified insurance cover which the Security Trustee may require.
14.10
Provision of information
Each Borrower shall promptly provide the Security Trustee with any information which it reasonably requests regarding:
(a)
the FSO owned by it, its employment, position and engagements;
(b)
the Earnings and payments and amounts due to the master and crew of the FSO owned by it;
(c)
any expenses incurred, or likely to be incurred, in connection with the operation, maintenance or repair of the FSO owned by it and any payments made in respect of that FSO;
(d)
any towages and salvages; and
(e)
its compliance, the Approved Manager's compliance and the compliance of the FSO owned by it with the ISM Code and the ISPS Code,
and, upon the Security Trustee's request, provide copies of any current charter relating to the FSO owned by it, of any current charter guarantee and copies of the Borrower's or the Approved Manager's Document of Compliance.
14.11
Notification of certain events
Each Borrower shall immediately notify the Security Trustee by fax, confirmed forthwith by letter, of:
(a)
any casualty which is or is likely to be or to become a Major Casualty;
(b)
any occurrence as a result of which the FSO owned by it has become or is, by the passing of time or otherwise, likely to become a Total Loss;
(c)
any outstanding or overdue requirement or recommendation made by any insurer or classification society or by any competent authority which is not immediately complied with;
(d)
any arrest or detention of the FSO owned by it, any exercise or purported exercise of any lien on that FSO or its Earnings or any requisition of that FSO for hire;
(e)
any intended dry docking of the FSO owned by it other than a routine drydocking;
(f)
any Environmental Claim made against that Borrower or in connection with the FSO owned by it, or any Environmental Incident;
(g)
any claim for breach of the ISM Code or the ISPS Code being made against that Borrower, the Approved Manager or otherwise in connection with the FSO owned by it; or

58     



(h)
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,
and that Borrower shall keep the Security Trustee advised in writing on a regular basis and in such detail as the Security Trustee shall require of that Borrower's, the Approved Manager's or any other person's response to any of those events or matters.
14.12
Restrictions on chartering, appointment of managers etc
(a)
No Borrower shall, in relation to the FSO owned by it:
(i)
let that FSO on demise charter for any period;
(ii)
enter into any charter in relation to that FSO under which more than 2 months' hire (or the equivalent) is payable in advance;
(iii)
charter that FSO otherwise than on bona fide arm's length terms at the time when that FSO is fixed;
(iv)
subject to paragraph (b), appoint a manager of that FSO other than the Approved Manager or agree to any alteration to the terms of the Approved Manager's appointment;
(v)
de-activate or lay up that FSO other than as permitted pursuant to the Service Contract for that FSO; or
(vi)
put that FSO into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed the amount specified for a Major Casualty (or the equivalent in any other currency) unless that person has first given to the Security Trustee and in terms satisfactory to it a written undertaking not to exercise any lien on that FSO or its Earnings for the cost of such work or for any other reason.
(b)
A Borrower may appoint International Seaways or an Affiliate of it as a manager of an FSO provided that:
(i)
such appointment is on the same terms as then applicable or on other terms reasonably acceptable to the Agent (acting on the instructions of the Majority Lenders); and
(ii)
the relevant person has provided the Agent with a letter of undertaking executed by it in favour of the Agent in the terms required by the Agent agreeing certain matters in relation to the management of the FSO and subordinating the rights of it against the relevant Borrower to the rights of the Creditor Parties under the Finance Documents.
14.13
Notice of Mortgage
Each Borrower shall keep the relevant Mortgage registered against the FSO owned by it as a valid first preferred or priority mortgage (as the case may be), carry on board that FSO a certified copy of the relevant Mortgage and place and maintain in a conspicuous place in the navigation room and the Master's cabin of that FSO a framed printed notice stating that that FSO is mortgaged by that Borrower to the Security Trustee.
14.14
Sharing of Earnings

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No Borrower shall enter into any agreement or arrangement for the sharing of any Earnings. For the avoidance of doubt, any sharing of Earnings as between the Borrowers to repay the Loan shall not be prohibited by this Clause 14.14 ( Sharing of Earnings ).
14.15
ISPS Code
Each Borrower shall comply with the ISPS Code and in particular, without limitation, shall:
(a)
procure that the FSO owned by that Borrower and the company responsible for that FSO's compliance with the ISPS Code comply with the ISPS Code; and
(b)
maintain for that FSO an ISSC; and
(c)
notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
14.16
Certain investments by the Borrowers
Neither Borrower shall make any investment other than:
(a)
an investment made in accordance with Clause 14.3 ( Repair and classification ), 14.4 ( Modification ), or otherwise expressly permitted by the Finance Documents, the Finance Documents (as defined in the Guarantee Facility) or the Master Agreements; or
(b)
an investment made with the prior written consent of the Majority Lenders.
15
PAYMENTS AND CALCULATIONS
15.1
Currency and method of payments
All payments to be made by the Lenders or by any Borrower under a Finance Document shall be made to the Agent or to the Security Trustee, in the case of an amount payable to it:
(a)
by not later than 1.00 p.m. (Amsterdam time) on the due date;
(b)
in same day Dollar funds settled through the New York Clearing House Interbank Payments System (or in such other Dollar funds and/or settled in such other manner as the Agent shall specify as being customary at the time for the settlement of international transactions of the type contemplated by this Agreement);
(c)
in the case of an amount payable by a Lender to the Agent or by any Borrower to the Agent or any Lender, to such account with such bank as the Agent may from time to time notify to the Borrowers and the other Creditor Parties; and
(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.
15.2
Payment on non-Business Day
If any payment by any Borrower under a Finance Document would otherwise fall due on a day which is not a Business Day:
(a)
the due date shall be extended to the next succeeding Business Day; or

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(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,
and interest shall be payable during any extension under paragraph (a) at the rate payable on the original due date.
15.3
Basis for calculation of periodic payments
All interest and commitment fee and any other payments under any Finance Document which are of an annual or periodic nature shall accrue from day to day and shall be calculated on the basis of the actual number of days elapsed and a 360 day year.
15.4
Distribution of payments to Creditor Parties
Subject to Clauses 15.5 ( Permitted deductions by Agent ), 15.6 ( Agent only obliged to pay when monies received ) and 15.7 ( Refund to Agent of monies not received ):
(a)
any amount received by the Agent under a Finance Document for distribution or remittance to a Lender or the Security Trustee shall be made available by the Agent to that Lender or, as the case may be, the Security Trustee by payment, with funds having the same value as the funds received, to such account as the Lender or the Security Trustee may have notified to the Agent not less than 5 Business Days previously; and
(b)
amounts to be applied in satisfying amounts of a particular category which are due to the Lenders generally shall be distributed by the Agent to each Lender pro rata to the amount in that category which is due to it.
15.5
Permitted deductions by Agent
Notwithstanding any other provision of this Agreement or any other Finance Document, the Agent may, before making an amount available to a Lender, deduct and withhold from that amount any sum which is then due and payable to the Agent from that Lender under any Finance Document or any sum which the Agent is then entitled under any Finance Document to require that Lender to pay on demand.
15.6
Agent only obliged to pay when monies received
Notwithstanding any other provision of this Agreement or any other Finance Document, the Agent shall not be obliged to make available to any Borrower or any Lender any sum which the Agent is expecting to receive for remittance or distribution to that Borrower or that Lender until the Agent has satisfied itself that it has received that sum.
15.7
Refund to Agent of monies not received
If and to the extent that the Agent makes available a sum to a Borrower or a Lender, without first having received that sum, that Borrower or (as the case may be) the Lender concerned shall, on demand:
(a)
refund the sum in full to the Agent; and
(b)
pay to the Agent the amount (as certified by the Agent) which will indemnify the Agent against any funding or other loss, liability or expense incurred by the Agent as a result of making the sum available before receiving it.

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15.8
Agent may assume receipt
Clause 15.7 ( Refund to Agent of monies not received ) shall not affect any claim which the Agent has under the law of restitution, and applies irrespective of whether the Agent had any form of notice that it had not received the sum which it made available.
15.9
Creditor Party accounts
Each Creditor Party shall maintain accounts showing the amounts owing to it by the Borrowers and each Security Party under the Finance Documents and all payments in respect of those amounts made by the Borrowers and any Security Party.
15.10
Agent's memorandum account
The Agent shall maintain a memorandum account showing the amounts advanced by the Lenders and all other sums owing to the Agent, the Security Trustee and each Lender from the Borrowers and each Security Party under the Finance Documents and all payments in respect of those amounts made by the Borrowers and any Security Party.
15.11
Accounts prima facie evidence
If any accounts maintained under Clauses 15.9 ( Creditor Party account ) and 15.10 ( Agent's memorandum account ) show an amount to be owing by a Borrower or a Security Party to a Creditor Party, those accounts shall be prima facie evidence that that amount is owing to that Creditor Party.
16
APPLICATION OF RECEIPTS
16.1
Normal order of application
Except as any Finance Document may otherwise provide, any sums which are received or recovered by any Creditor Party under or by virtue of any Finance Document shall be applied:
(a)
FIRST: in or towards satisfaction of any amounts then due and payable under the Finance Documents and the Master Agreements in the following order and proportions:
(i)
first, in or towards satisfaction pro rata of all amounts then due and payable to the Creditor Parties under the Finance Documents other than those amounts referred to at paragraphs (ii) and (iii) (including, but without limitation, all amounts payable by the Borrower under Clauses 20 ( Indemnities ), 21 ( No set-off or tax deduction ) and 26 ( Illegality, etc ) of this Agreement or by the Borrower or any Security Party under any corresponding or similar provision in any other Finance Document or in any Master Agreement);
(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 the Master Agreements (and, for this purpose, the expression “"interest" shall include any net amount which the Borrower shall have become liable to pay or deliver under section 2 ( Obligations ) of any Master Agreement but shall have failed to pay or deliver to the relevant Swap Counterparty at the time of application or distribution under this Clause 16 ( Application of receipts ); and
(iii)
thirdly, in or towards satisfaction pro rata of the Loan and the Swap Exposure of each Swap Counterparty (in the case of the latter, calculated as at the actual Early Termination Date applying to each particular Designated Transaction, or if no such Early Termination

62     



Date shall have occurred, calculated as if an Early Termination Date occurred on the date of application or distribution hereunder);
(b)
SECONDLY: in retention of an amount equal to any amount not then due and payable under any Finance Document or any Master Agreement but which the Agent, by notice to the Borrower, the Security Parties and the other Creditor Parties, states in its opinion will 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 paragraph (a) of Clause 16.1 ( Normal order of application ); and
(c)
THIRDLY: any surplus shall be paid to the Borrower or to any other person who has the legal right to receive such amounts that supersedes the Borrower’s rights to receive such amounts (but, with any excess thereof being paid to the Borrower).
16.2
Variation of order of application
The Agent may, with the authorisation of the Lenders, by notice to the Borrowers, the Security Parties and the other Creditor Parties provide for a different manner of application from that set out in Clause 16.1 ( Normal order of application ) either as regards a specified sum or sums or as regards sums in a specified category or categories.
16.3
Notice of variation of order of application
The Agent may give notices under Clause 16.2 ( 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 Business Day before the date on which the notice is served.
16.4
Appropriation rights overridden
This Clause 16 ( Application of Receipts ) and any notice which the Agent gives under Clause 16.2 ( Variation of order of application ) shall override any right of appropriation possessed, and any appropriation made, by any Borrower or any Security Party.
17
APPLICATION OF EARNINGS
17.1
Payment of Earnings
Each Borrower undertakes with each Creditor Party to ensure that, throughout the Security Period (and subject only to the provisions of the General Assignment), all the Earnings of the FSO owned by it are paid to the Earnings Account for that FSO. The daily rate paid by NOC under each Service Contract (after operating expenses, overhead and taxes) shall be held in the Earnings Account for the relevant FSO for the Borrowers to make the payments of principal and interest due under this Agreement and the balance of the Earnings in excess of the amounts necessary for such payments shall be available to the Borrowers unless an Event of Default has occurred and is continuing.
17.2
Location of accounts
Each Borrower shall promptly:
(a)
comply with any requirement of the Agent as to the location or re‑location of the Earnings Accounts (or either of them); and

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(b)
execute any documents which the Agent specifies to create or maintain in favour of the Security Trustee a Security Interest over (and/or rights of set-off, consolidation or other rights in relation to) the Earnings Accounts.
17.3
Debits for expenses etc
Upon the occurrence of an Event of Default which is continuing, the Agent shall be entitled (but not obliged) from time to time to debit any Earnings Account with prior or contemporaneous notice in order to discharge any amount due and payable under Clause 19 ( Fees and Expenses ) or 20 ( Indemnities ) to a Creditor Party or payment of which any Creditor Party has become entitled to demand under Clause 19 ( Fees and Expenses ) or 20 ( Indemnities ).
18
EVENTS OF DEFAULT
18.1
Events of Default
An Event of Default occurs if:
(a)
any Borrower or any Security Party fails to pay on the due date 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:
(A)
administrative or technical error; or
(B)
a Disruption Event; and
(ii)
payment is made within 3 Business Days of its due date.
(b)
any breach occurs of Clause 9.2 ( Waiver of conditions precedent ), 11.2 ( Title; negative pledge ), 11.3 ( No disposal of assets ), 11.22 ( Compliance with Sanctions Laws ), 12.2 ( Maintenance of status ) or 12.3 ( Negative undertakings ); or
(c)
any breach by any Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach covered by paragraphs (a) or (b)) which, in the opinion of the Majority Lenders, is capable of remedy, and such default continues unremedied 15 Business Days after written notice from the Agent requesting action to remedy the same; or
(d)
(subject to any applicable grace period specified in the Finance Document) any breach by any Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach falling within paragraphs (a), (b) or (c)); or
(e)
any representation, warranty or statement made or repeated by, or by an officer of, a Borrower or a Security Party in a Finance Document or in a Drawdown Notice or any other notice or document relating to a Finance Document is untrue or misleading in any material respect when it is made or repeated ; or
(f)
any of the following occurs in relation to any Financial Indebtedness of a Relevant Person in the case of each Borrower, any sum, in the case of each Shareholder, a sum of or sums aggregating $10,000,000 or more and in the case of each Guarantor in respect of a sum of or sums aggregating $25,000,000 or more (or, in each case, the equivalent in another currency)):
(i)
any Financial Indebtedness of a Relevant Person is not paid when due; or

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(ii)
any Financial Indebtedness of a Relevant Person becomes due and payable or capable of being declared due and payable prior to its stated maturity date as a consequence of any event of default; or
(iii)
a lease, hire purchase agreement or charter creating any Financial Indebtedness of a Relevant Person is terminated by the lessor or owner or becomes capable of being terminated as a consequence of any termination event; or
(iv)
any overdraft, loan, note issuance, acceptance credit, letter of credit, guarantee, foreign exchange or other facility, or any swap or other derivative contract or transaction, relating to any Financial Indebtedness of a Relevant Person ceases to be available or becomes capable of being terminated as a result of any event of default, or cash cover is required, or becomes capable of being required, in respect of such a facility as a result of any event of default; or
(v)
any Security Interest securing any Financial Indebtedness of a Relevant Person becomes enforceable,
provided that , where an event described in paragraphs (i) to (v) has occurred only in respect of one Guarantor:
(A)
no Event of Default shall occur under this paragraph (f) if the other Guarantor has delivered to the Agent a guarantee of all of the Secured Liabilities duly executed by it in favour of the Security Trustee in Agreed Form; and
(B)
no Event of Default shall occur unless the Agent has notified the Borrowers of its occurrence prior to the other Guarantor providing such a guarantee;
and provided further that , where an event described in paragraphs (i) to (v) has occurred for any of the Shareholders or the Guarantors, the Agent (acting with the authorisation of the Lenders) has served a notice on the Borrowers declaring such event to be an Event of Default under this Agreement; or
(g)
any of the following occurs in relation to a Relevant Person:
(i)
a Relevant Person becomes 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 in respect of any sum in the case of a Borrower or in respect of a sum of, or sums aggregating, $10,000,000 or more in the case of a Shareholder or $25,000,000 or more in the case of a Guarantor or, in each case, the equivalent in another currency; 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
(v)
any formal declaration of bankruptcy or any formal statement to the effect that a Relevant Person is insolvent or likely to become insolvent is made by a Relevant Person or by the directors of a Relevant Person or, in any proceedings, by a lawyer acting for a Relevant Person; or

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(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
(vii)
a resolution is passed, an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by (aa) a Relevant Person, (bb) the members or directors of a Relevant Person, (cc) a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person, or (dd) a government minister or public or regulatory authority of a Pertinent Jurisdiction for or with a view to the winding up of that or another Relevant Person or the appointment of a provisional liquidator or administrator in respect of that or another Relevant Person, or that or another Relevant Person ceasing or suspending business operations or payments to creditors, save that this paragraph does not apply to a fully solvent winding up of a Relevant Person other than the Borrowers or the Guarantors which is, or is to be, effected for the purposes of an amalgamation or reconstruction previously approved by the Majority Lenders and effected not later than 3 months after the commencement of the winding up; or
(viii)
an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by a creditor of a Relevant Person (other than a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person) for the winding up of a Relevant Person or the appointment of a provisional liquidator or administrator in respect of a Relevant Person in any Pertinent Jurisdiction, unless the proposed winding up, appointment of a provisional liquidator or administration is being contested in good faith, on substantial grounds and not with a view to some other insolvency law procedure being implemented instead and either (aa) the application or petition is dismissed or withdrawn within 30 days of being made or presented, or (bb) within 30 days of the administration notice being given or filed, or the other relevant steps being taken, other action is taken which will ensure that there will be no administration and (in both cases (aa) or (bb)) the Relevant Person will continue to carry on business in the ordinary way and without being the subject of any actual, interim or pending insolvency law procedure; or
(ix)
a Relevant Person or its directors take any steps (whether by making or presenting an application or petition to a court, or submitting or presenting a document setting out a proposal or proposed terms, or otherwise) with a view to obtaining, in relation to that or another Relevant Person, any form of moratorium, suspension or deferral of payments, reorganisation of debt (or certain debt) or arrangement with all or a substantial proportion (by number or value) of creditors or of any class of them or any such moratorium, suspension or deferral of payments, reorganisation or arrangement is effected by court order, by the filing of documents with a court, by means of a contract or in any other way at all; or
(x)
any meeting of the members or directors, or of any committee of the board or senior management, of a Relevant Person is held or summoned for the purpose of considering a resolution or proposal to authorise or take any action of a type described in paragraphs (iv) to (ix) or a step preparatory to such action, or (with or without such a meeting) the members, directors or such a committee resolve or agree that such an action or step should be taken or should be taken if certain conditions materialise or fail to materialise; or
(xi)
in a Pertinent Jurisdiction other than England, any event occurs, any proceedings are opened or commenced or any step is taken which, in the opinion of the Majority Lenders is similar to any of the foregoing;

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provided that , where an event described in subparagraph (ii) has occurred for any of the Shareholders or the Guarantors, the Agent (acting with the authorisation of the Lenders) has served a notice on the Borrowers declaring such event to be an Event of Default under this Agreement; or
(h)
any Borrower ceases or suspends carrying on its business or a part of its business which is material in the context of this Agreement; or
(i)
it becomes unlawful in any Pertinent Jurisdiction or impossible:
(i)
for any Borrower or any Security Party to discharge any liability under a Finance Document or to comply with any other material obligation under a Finance Document; or
(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
(j)
any official consent necessary to enable any Borrower to own, operate or charter the FSO owned by it or to enable any Borrower or any Security Party to comply with any provision which the Majority Lenders acting reasonably consider material of a Finance Document or Service Contracts is not granted, expires without being renewed, is revoked or becomes liable to revocation or any condition of such a consent is not fulfilled,
PROVIDED THAT, that Borrower shall have 30 days to obtain any such official consent as long as the lack of such consent does not have a material adverse effect on the FSO’s ability to continue to perform the Service Contract and the Borrowers and Security Parties shall have 30 days to obtain any consent necessary to comply with any provision the Majority Lenders acting reasonably consider material of a Finance Document.
(k)
it appears to the Majority Lenders that, without their prior consent, a change has occurred after the date of this Agreement in the direct ownership of any of the shares in any Borrower Provided that this shall not apply (i) if there is an intra-group change of ownership of any Borrower if the Guarantors each continue to be the direct or indirect owners of 50 per cent. of the shares in that Borrower and the Guarantees remain in full force and effect or (ii) if it is a transfer in accordance with Clause 12.4 ( Transfer of ownership ); or
(l)
any provision which the Majority Lenders acting reasonably consider material of a Finance Document proves to have been or becomes invalid or unenforceable, or a Security Interest created by a Finance Document proves to have been or becomes invalid or unenforceable or such a Security Interest proves to have ranked after, or loses its priority to, another Security Interest or any other third party claim or interest; or
(m)
the security constituted by a Finance Document is in any way materially imperilled or materially placed in jeopardy; or
(n)
any event of default occurs and is continuing under the Guarantee Facility; or
(o)
any Event of Default (as defined in section 14 of a Master Agreement) occurs and is continuing; or
(p)
NOC fails to pay any sum payable under a Service Contract within 60 days (on which banks are open in London and New York City) of its due date; or

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(q)
any event or circumstance occurs which has or is reasonably likely to have a Material Adverse Effect occurs, Provided that no Event of Default will occur under this paragraph (q) if such events or circumstances are capable of remedy and are remedied within 30 days of the Agent giving notice to the Borrowers of their occurrence.
18.2
Actions following an Event of Default
On, or at any time after, the occurrence of an Event of Default and which it is continuing:
(a)
the Agent may, and if so instructed by the Majority Lenders, the Agent shall:
(i)
serve on the Borrowers a notice stating that the Commitments and all other obligations of each Lender to the Borrowers under this Agreement are cancelled; and/or
(ii)
serve on the Borrowers a notice stating that the Loan, all accrued interest and all other amounts accrued or owing under this Agreement are immediately due and payable or are due and payable on demand; and/or
(iii)
take any other action which, as a result of the Event of Default having occurred and continuing or any notice served under paragraph (i) or (ii), the Agent and/or the Lenders and/or the Swap Counterparties are entitled to take under any Finance Document or any applicable law; and/or
(b)
the Security Trustee may, and if so instructed by the Agent, acting with the authorisation of the Majority Lenders, the Security Trustee shall take any action which, as a result of the Event of Default having occurred and continuing or any notice served under paragraph (a) (i) or (ii), the Security Trustee, the Agent and/or the Lenders are entitled to take under any Finance Document or any applicable law.
18.3
Termination of Commitments
On the service of a notice under paragraph (a)(i) of Clause 18.2 ( Actions following an Event of Default ), the Commitments and all other obligations of each Lender to the Borrowers under this Agreement shall be cancelled.
18.4
Acceleration of Loan
On the service of a notice under paragraph (a)(ii) of Clause 18.2 ( Actions following an Event of Default ), the Loan, all accrued interest and all other amounts accrued or owing from the Borrowers or any Security Party under this Agreement and every other Finance Document shall become immediately due and payable or, as the case may be, payable on demand.
18.5
Multiple notices; action without notice
The Agent may serve notices under paragraph (a)(i) or (ii) of Clause 18.2 ( Actions following an Event of Default ) simultaneously or on different dates and it and/or the Security Trustee may take any action referred to in Clause 18.2 ( Actions following an Event of Default ) if no such notice is served or simultaneously with or at any time after the service of both or either of such notices.
18.6
Notification of Creditor Parties and Security Parties
The Agent shall send to each Lender, the Security Trustee and each Security Party a copy or the text of any notice which the Agent serves on the Borrowers under Clause 18.2 ( Actions following an Event of Default ); but the notice shall become effective when it is served on the Borrowers,

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and no failure or delay by the Agent to send a copy or the text of the notice to any other person shall invalidate the notice or provide any Borrower or any Security Party with any form of claim or defence.
18.7
Creditor Parties' rights unimpaired
Nothing in this Clause shall be taken to impair or restrict the exercise of any right given to individual Lenders or Swap Counterparties under a Finance Document, a Master Agreement or the general law; and, in particular, this Clause is without prejudice to Clause 3.1 ( Interests several ).
18.8
Exclusion of Creditor Party liability
No Creditor Party, and no receiver or manager appointed by the Security Trustee, shall have any liability to a Borrower or a Security Party:
(a)
for any loss caused by an exercise of rights under, or enforcement of a Security Interest created by, a Finance Document or by any failure or delay to exercise such a right or to enforce such a 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 a Security Interest or for any reduction (however caused) in the value of such an asset,
except that this does not exempt a Creditor Party or a receiver or manager from liability for losses shown to have been caused by the gross negligence, dishonesty or the wilful misconduct of such Creditor Party's own officers and employees or (as the case may be) such receiver's or manager's own partners or employees.
In no event shall any Creditor Party be liable on any theory of liability for any special, indirect, consequential or punitive damages and each Borrower hereby waives, releases and agrees not to sue upon any such claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favour.
18.9
Relevant Persons
In this Clause 18 ( Events of Default ), a " Relevant Person " means the Borrowers, the Guarantors and the Shareholders.
18.10
Guarantor default
If there is an Event of Default in relation to only 1 Guarantor the other Guarantor may with the agreement of all of the Lenders remedy such default by providing the Lenders with a guarantee in respect of the full amount of all the obligations of the Borrowers under this Agreement and the other Finance Documents within 30 days of such default.
18.11
Interpretation
In paragraph (f) of Clause 18.1 ( Events of Default ) references to an event of default or a termination event include any event, howsoever described, which is similar to an event of default in a facility agreement or a termination event in a finance lease; and in paragraph (g) of Clause 18.1 ( Events of Default ) "petition" includes an application.
18.12
Position of Swap Counterparties

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Neither the Agent nor the Security Trustee shall be obliged, in connection with any action taken or proposed to be taken under or pursuant to the foregoing provisions of this Clause 18 ( Events of Default ), to have any regard to the requirements of a Swap Counterparty except to the extent that such Swap Counterparty is also a Lender.
In addition, the Swap Counterparties agree that if an Event of Default or Potential Event of Default occurs and is continuing any payments due to the Swap Counterparties on an unwinding of the Master Agreements shall not be paid until the loan has first been repaid.
19
FEES AND EXPENSES
19.1
Arrangement, commitment, agency fees
The Borrowers shall pay to the Agent:
(a)
on the date of this Agreement, an arrangement fee of an amount agreed in a Fee Letter, for distribution among the Lenders in accordance with that Fee Letter;
(b)
quarterly in arrears during the period from (and including) the date of this Agreement to the end of the Availability Period and on the last day of that period for the account of the Lenders, a commitment fee at the rate of 35 per cent of the Margin per annum on the amount of the Total Commitments less the amount of the Loan, for distribution among the Lenders pro rata to their Commitments; and
(c)
on the date of this Agreement and on each anniversary thereof during the Security Period, an annual agency fee of an amount agreed in a Fee Letter, such agency fee to be payable to the Agent in accordance with that Fee Letter for its own account.
19.2
Costs of negotiation, preparation etc
The Borrowers shall pay to the Agent on its demand the amount of all expenses reasonably incurred by the Agent or the Security Trustee in connection with the negotiation, preparation, execution or registration of any Finance Document or any related document or with any transaction contemplated by a Finance Document or a related document.
19.3
Costs of variations, amendments, enforcement etc
The Borrowers shall pay to the Agent, on the Agent's demand, for the account of the Creditor Party concerned the amount of all expenses incurred by a Creditor Party in connection with (and which shall be reasonably incurred in the case of sub-clause (a), (b) and (c):
(a)
any amendment or supplement to a Finance Document, or any proposal for such an amendment to be made;
(b)
any consent or waiver by the Lenders, the Swap Banks, the Majority Lenders or the Creditor Party concerned under or in connection with a Finance Document, or any request for such a consent or waiver;
(c)
the valuation of any security provided or offered under Clause 15 ( Payments and Calculations ) or any other matter relating to such security; or
(d)
any step taken by the Creditor Party concerned with a view to the protection, exercise or enforcement of any right or Security Interest created by a Finance Document or for any similar purpose.

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(e)
There shall be recoverable under paragraph (d) the full amount of all legal expenses, whether or not such as would be allowed under rules of court or any taxation or other procedure carried out under such rules.
19.4
Documentary taxes
The Borrowers shall promptly pay any tax payable on or by reference to any Finance Document, and shall, on the Agent's demand, fully indemnify each Creditor Party against any claims, expenses, liabilities and losses resulting from any failure or delay by the Borrowers to pay such a tax.
19.5
Certification of amounts
A notice which is signed by 2 officers of a Creditor Party, which states that a specified amount, or aggregate amount, is due to that Creditor Party under this Clause 19 ( Fees and Expenses ) and which indicates (without necessarily specifying a detailed breakdown) the matters in respect of which the amount, or aggregate amount, is due shall be prima facie evidence that the amount, or aggregate amount, is due.
20
INDEMNITIES
20.1
Indemnities regarding borrowing and repayment of Loan
The Borrowers shall fully indemnify the Agent and each Lender on the Agent's demand and the Security Trustee on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by that Creditor Party, or which that Creditor Party reasonably and with due diligence estimates that it will incur, as a result of or in connection with:
(a)
an Advance not being borrowed on the date specified in the Drawdown Notice for any reason other than a default by the Lender claiming the indemnity;
(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;
(c)
any failure (for whatever reason) by the Borrowers to make payment of any amount due under a Finance Document on the due date or, if so payable, on demand (after giving credit for any default interest paid by the Borrowers on the amount concerned under Clause 7 ( Default interest )); and
(d)
the occurrence and/or continuance of an Event of Default or a Potential Event of Default and/or the acceleration of repayment of the Loan under Clause 18 ( Events of Default ),
and in respect of any tax (other than (i) tax on its overall net income in its jurisdiction of incorporation, the jurisdiction in which it is resident for tax purposes, or the jurisdiction in which its Facility Office is located or (ii) a FATCA Deduction made in accordance with Clause 21.9 ( FATCA Deduction )) for which a Creditor Party is liable in connection with any amount paid or payable to that Creditor Party (whether for its own account or otherwise) under any Finance Document.
20.2
Breakage costs
Without limiting its generality, Clause 20.1 ( Indemnities regarding borrowing and repayment of Loan ) covers any claim, expense, liability or loss incurred by a Lender:

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(a)
in liquidating or employing deposits from third parties acquired or arranged to fund or maintain all or any part of its Contribution and/or any overdue amount (or an aggregate amount which includes its Contribution or any overdue amount); and
(b)
in terminating, or otherwise in connection with, any interest and/or currency swap or any other transaction entered into (whether with another legal entity or with another office or department of the Lender concerned) to hedge any exposure arising under this Agreement which is attributable to this Agreement of the amount of the liabilities, expenses or losses incurred by it in terminating, or otherwise in connection with, a number of transactions of which this Agreement is one.
20.3
Miscellaneous indemnities
The Borrowers shall fully indemnify each Creditor Party severally on their respective demands in respect of all claims, expenses, liabilities and losses which may be made or brought against or incurred by a Creditor Party, in any country, as a result of or in connection with:
(a)
any action taken, or omitted or neglected to be taken, under or in connection with any Finance Document by the Agent, the Security Trustee or any other Creditor Party or by any receiver appointed under a Finance Document; or
(b)
any other Pertinent Matter,
other than claims, expenses, liabilities and losses which are shown to have been caused by the gross negligence, dishonesty or wilful misconduct of the officers or employees of the Creditor Party concerned.
20.4
Currency indemnity
If any sum due from any Borrower or any Security Party to a Creditor Party under a Finance Document or under any order or judgment relating to a Finance Document has to be converted from the currency in which the Finance Document provided for the sum to be paid (the " Contractual Currency ") into another currency (the " Payment Currency ") for the purpose of:
(a)
making or lodging any claim or proof against any Borrower or any Security Party, whether in its liquidation, any arrangement involving it or otherwise; or
(b)
obtaining an order or judgment from any court or other tribunal; or
(c)
enforcing any such order or judgment,
the Borrowers shall indemnify the Creditor Party concerned against the loss arising when the amount of the payment actually received by that Creditor Party is converted at the available rate of exchange into the Contractual Currency.
In this Clause 20.4 ( Currency indemnity ) the " available rate of exchange " means the rate at which the Creditor Party concerned is able at the opening of business (London time) on the Business Day after it receives the sum concerned to purchase the Contractual Currency with the Payment Currency.
This Clause 20.4 ( Currency indemnity ) creates a separate liability of the Borrowers which is distinct from their other liabilities under the Finance Documents and which shall not be merged in any judgment or order relating to those other liabilities.
20.5
Application to Master Agreements

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For the avoidance of doubt, Clause 20.4 ( Currency indemnity ) does not apply in respect of sums due from a Borrower to a Swap Counterparty under or in connection with a Master Agreement as to which sums the provisions of section 8 ( Contractual Currency ) of that Master Agreement shall apply.
20.6
Sanctions and regulatory indemnities
The Borrower shall pay to the Agent on demand, and the Borrower shall indemnify each Lender against, all costs, charges, expenses, claims, liabilities, losses, duties and fees (including, but not limited to, legal fees and expenses on a full indemnity basis) and taxes thereon suffered or incurred by a Lender (other than in each case by reason of a Lender's gross negligence, dishonesty or wilful misconduct):
(a)
arising or asserted under or in connection with any law relating to safety at sea, the ISM Code, any Environmental Law or any Sanctions Law; or
(b)
as a result of any claim, action, civil penalty or fine against, any settlement, and any other kind of loss or liability, and as a result of conduct of the Borrower, either Guarantor or any of the Borrower’s or either Guarantor's partners, directors, officers, employees or agents that violates any Sanctions Laws.
20.7
Certification of amounts
A notice which is signed by 2 officers of a Creditor Party, which states that a specified amount, or aggregate amount, is due to that Creditor Party under this Clause 20 ( Indemnities ) and which indicates (without necessarily specifying a detailed breakdown) the matters in respect of which the amount, or aggregate amount, is due shall be prima facie evidence that the amount, or aggregate amount, is due.
20.8
Sums deemed due to a Lender
For the purposes of this Clause 20 ( Indemnities ), a sum payable by the Borrowers to the Agent or the Security Trustee for distribution to a Lender shall be treated as a sum due to that Lender.
21
NO SET-OFF OR TAX DEDUCTION
21.1
No deductions
All amounts due from the Borrowers under a Finance Document shall be paid:
(a)
without any form of set‑off, 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.
21.2
Grossing-up for taxes
If a Borrower is required by law to make a tax deduction from any payment:
(a)
that Borrower shall notify the Agent as soon as it becomes aware of the requirement;
(b)
that Borrower shall pay the tax deducted to the appropriate taxation authority promptly, and in any event before any fine or penalty arises;

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(c)
the amount due in respect of the payment shall be increased by the amount necessary to ensure that each Creditor Party receives and retains (free from any liability relating to the tax deduction) a net amount which, after the tax deduction, is equal to the full amount which it would otherwise have received.
21.3
Evidence of payment of taxes
Within 1 month after making any tax deduction, the Borrower concerned shall deliver to the Agent documentary evidence satisfactory to the Agent that the tax had been paid to the appropriate taxation authority.
21.4
Tax credit
A Creditor Party which has obtained (and has derived full use and benefit, on an affiliated group basis from) a repayment or credit in respect of tax on account of which the Borrowers have made an increased payment under Clause 21.2 ( Grossing-up for taxes ) shall pay to the Borrowers a sum equal to the proportion of the repayment or credit which that Creditor Party allocates to the amount due from the Borrowers in respect of which the Borrowers made the increased payment Provided that :
(a)
the Creditor Party shall not be obliged to allocate to this transaction any part of a tax repayment or credit which is referable to a class or number of transactions;
(b)
nothing in this Clause 21.4 ( Tax credit ) shall oblige a Creditor Party to arrange 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;
(c)
nothing in this Clause 21.4 ( Tax credit ) shall oblige a Creditor Party to make a payment which would leave it in a worse position than it would have been in if the Borrowers had not been required to make a tax deduction from a payment;
(d)
any allocation or determination made by a Creditor Party under or in connection with this Clause 21.4 ( Tax credit ) shall be conclusive and binding on the Borrowers and the other Creditor Parties;
(e)
nothing in this Clause 21.4 ( Tax credit ) shall oblige any Creditor Party to disclose to the Borrowers any information relating to its affairs (tax or otherwise) or those of its ultimate parent company (or any subsidiary thereof) or any computations in respect of tax; and
(f)
the Creditor Party's tax affairs for its tax year in respect of which such credit or repayment was obtained have been finally settled.
21.5
Exclusion of tax on overall net income
In this Clause 21 ( No Set-Off or Tax Deduction ) " tax deduction " means any deduction or withholding for or on account of any present or future tax except (i) tax on a Creditor Party’s overall net income or (ii) a FATCA Deduction.
21.6
Application to Master Agreements
For the avoidance of doubt, Clause 21 ( No Set-Off or Tax Deduction ) does not apply in respect of sums due from a Borrower to a Swap Counterparty under or in connection with a Master Agreement as to which sums the provisions of section 2(d) (Deduction or Withholding for Tax) of that Master Agreement shall apply.

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21.7
VAT
(a)
All amounts expressed to be payable under a Finance Document by any Party to a Creditor Party are deemed to be exclusive of any VAT. If VAT is or becomes chargeable on any supply made by any Creditor Party to any Party under a Finance Document and such Creditor Party is required to account to the relevant tax authority for the VAT, that Party must pay to such Creditor 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 Creditor Party must promptly provide an appropriate VAT invoice to that Party).
(b)
If VAT is or becomes chargeable on any supply made by any Creditor Party (the " Supplier ") to any other Creditor Party (the " Recipient ") under a Finance Document, and any Party other than the Recipient (the " Relevant Party ") is required by the terms of any Finance Document to pay an amount equal to the consideration for that supply to the Supplier (rather than being required to reimburse or indemnify the Recipient in respect of that consideration):
(i)
(where the Supplier is the person required to account to the relevant tax authority for the VAT) the Relevant Party must also pay to the Supplier (at the same time as paying that amount) an additional amount equal to the amount of the VAT. The Recipient must (where this sub-paragraph (i) applies) promptly pay to the Relevant Party an amount equal to any credit or repayment the Recipient receives from the relevant tax authority which the Recipient reasonably determines relates to the VAT chargeable on that supply; and
(ii)
(where the Recipient is the person required to account to the relevant tax authority for the VAT) the 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 Creditor Party for any cost or expense, that Party shall reimburse or indemnify (as the case may be) such Creditor Party for the full amount of such cost or expense, including such part of it as represents VAT, save to the extent that such Creditor 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 21.7 ( 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) 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).
(e)
In relation to any supply made by a Creditor Party to any Party under a Finance Document, if reasonably requested by such Creditor Party, that Party must promptly provide such Creditor Party with details of that Party's VAT registration and such other information as is reasonably requested in connection with such Creditor Party's VAT reporting requirements in relation to such supply.
21.8
FATCA Information

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(a)
Subject to paragraph (c) below, each Party shall, within 10 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 any Creditor Party 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.
21.9
FATCA Deduction
(a)
Any party to a Finance Document may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no such 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 to a Finance Document shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction) notify the party to whom it is making the payment and, in addition, shall notify the Borrowers, the Agent and the other Creditor Parties.
22
THE AGENT, THE MANDATED LEAD ARRANGERS AND THE REFERENCE BANKS
22.1
Appointment of the Agent

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(a)
Each of the Arrangers, the Lenders and the Swap Banks appoints the Agent to act as its agent under and in connection with the Finance Documents.
(b)
Each of the Arrangers, the Lenders and the Swap Banks authorises the Agent to perform the duties, obligations and responsibilities and to exercise the rights, powers, authorities and discretions specifically given to the Agent under, or in connection with, the Finance Documents together with any other incidental rights, powers, authorities and discretions.
22.2
Instructions
(a)
The 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 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 Creditor Party or group of Creditor Parties, in accordance with instructions given to it by that Creditor Party or group of Creditor Parties).
(b)
The 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 Creditor Party or group of Creditor Parties, from that Creditor Party or group of Creditor Parties) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the 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 Creditor Party or group of Creditor Parties under the relevant Finance Document and unless a contrary indication appears in a Finance Document, any instructions given to the Agent by the Majority Lenders shall override any conflicting instructions given by any other Parties and will be binding on all Creditor 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 Agent to act in a specified manner or to take a specified action;
(iii)
in respect of any provision which protects the Agent's own position in its personal capacity as opposed to its role of Agent for the relevant Creditor Parties.
(e)
If giving effect to instructions given by the Majority Lenders would in the Agent's opinion have an effect equivalent to an amendment or waiver referred to in Clause 32 ( Variations and Waivers ), the Agent shall not act in accordance with those instructions unless consent to it so acting is obtained from each Party (other than the Agent) whose consent would have been required in respect of that amendment or waiver.

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(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 Agent shall do so having regard to the interests of all the Creditor Parties.
(g)
The Agent may refrain from acting in accordance with any instructions of any Creditor Party or group of Creditor 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 22.2 ( Instructions ), in the absence of instructions, the 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 Creditor Parties. The Agent may act (or refrain from acting) as it considers to be in the best interest of the Creditor Parties.
(i)
The Agent is not authorised to act on behalf of a Creditor Party (without first obtaining that Creditor 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 Finance Documents or enforcement of the Finance Documents.
22.3
Duties of the Agent
(a)
The Agent's duties under the Finance Documents are solely mechanical and administrative in nature.
(b)
Subject to paragraph (c) below, the Agent shall promptly forward to a Party the original or a copy of any document which is delivered to the Agent for that Party by any other Party.
(c)
Without prejudice to Clause 29.3 ( Transfer certificate, delivery and notification ), paragraph (b) above shall not apply to any Transfer Certificate.
(d)
Except where a Finance Document specifically provides otherwise, the Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
(e)
If the Agent receives notice from a Party referring to any Finance Document, describing an Event of Default and stating that the circumstance described is an Event of Default, it shall promptly notify the other Creditor Parties.
(f)
If the Agent is aware of the non-payment of any principal, interest, commitment fee or other fee payable to a Creditor Party (other than the Agent, the Arrangers or the Security Trustee) under this Agreement, it shall promptly notify the other Creditor Parties.
(g)
The 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).
22.4
Role of the Mandated Lead Arranger
Except as specifically provided in the Finance Documents, the Arrangers have no obligations of any kind to any other Party under or in connection with any Finance Document.
22.5
No fiduciary duties

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(a)
Nothing in any Finance Document constitutes the Agent or any Arranger as a trustee or fiduciary of any other person.
(b)
Neither the Agent nor any Arranger shall be bound to account to other Creditor Party for any sum or the profit element of any sum received by it for its own account.
22.6
Application of receipts
Except as expressly stated to the contrary in any Finance Document, any moneys which the Agent receives or recovers in its capacity as Agent shall be applied by the Agent in accordance with Clause 16 ( Application of Receipts ).
22.7
Business with the Group
The Agent and the Arrangers may accept deposits from, lend money to, and generally engage in any kind of banking or other business with, any member of either Group.
22.8
Rights and discretions
(a)
The 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 Creditor Parties or any group of Creditor 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,
as sufficient evidence that that is the case and, in the case of paragraph (A) above, may assume the truth and accuracy of that certificate.
(b)
The Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Creditor Parties) that:
(i)
no Event of Default has occurred (unless it has actual knowledge of an Event of Default arising under paragraph (a) of Clause 18.1 ( Events of Default )); and
(ii)
any right, power, authority or discretion vested in any Party or any group of Creditor Parties has not been exercised.
(c)
The Agent may engage and pay for the advice or services of any lawyers, accountants, tax advisers, surveyors or other professional advisers or experts.

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(d)
Without prejudice to the generality of paragraph (c) above or paragraph (e) below, the Agent may at any time engage and pay for the services of any lawyers to act as independent counsel to the Agent (and so separate from any lawyers instructed by the Lenders) if the Agent in its reasonable opinion deems this to be desirable.
(e)
The Agent may rely on the advice or services of any lawyers, accountants, tax advisers, surveyors or other professional advisers or experts (whether obtained by the Agent or by any other Party) and shall not be liable for any damages, costs or losses to any person, any diminution in value or any liability whatsoever arising as a result of its so relying.
(f)
The 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, unless such error or such loss was directly caused by the Agent's gross negligence or wilful misconduct.
(g)
Unless a Finance Document expressly provides otherwise the 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 Agent nor the Arrangers are 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.
(i)
Notwithstanding any provision of any Finance Document to the contrary, the 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.
22.9
Responsibility for documentation
Neither the Agent nor the Arrangers are responsible or liable for:
(a)
the adequacy, accuracy or completeness of any information (whether oral or written) supplied by the Agent, the Security Trustee, the Arrangers, the Borrowers or any other person in, or in connection with, any Finance Document or the transactions contemplated in the Finance Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance Document; or
(b)
the legality, validity, effectiveness, adequacy or enforceability of any Pertinent 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 Pertinent Document or the Security Property.
22.10
No duty to monitor
The Agent shall not be bound to enquire:
(a)
whether or not any Event of Default has occurred;

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(b)
as to the performance, default or any breach by the Borrower of its obligations under any Finance Document; or
(c)
whether any other event specified in any Finance Document has occurred.
22.11
Exclusion of liability
(a)
Without limiting paragraph (b) below (or any other provision of any Finance Document excluding or limiting the liability of the Agent), the Agent will not be liable for:
(i)
any damages, costs or losses to any person, any diminution in value, or any liability whatsoever arising as a result of taking or not taking any action under or in connection with any Finance Document or the Security Property, unless directly caused by its gross negligence or wilful misconduct;
(ii)
exercising, or not exercising, any right, power, authority or discretion given to it by, or in connection with, any Finance 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 Finance 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,
including (in each case and without limitation) such damages, costs, losses, diminution in value or liability arising as a result of nationalisation, expropriation or other governmental actions; any regulation, currency restriction, devaluation or fluctuation; market conditions affecting the execution or settlement of transactions or the value of assets (including any Disruption Event); breakdown, failure or malfunction of any third party transport, telecommunications, computer services or systems; natural disasters or acts of God; war, terrorism, insurrection or revolution; or strikes or industrial action.
(b)
No Party other than the Agent may take any proceedings against any officer, employee or agent of the Agent in respect of any claim it might have against the Agent or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Finance Document or any Security Property and any officer, employee or agent of the Agent may rely on this Clause.
(c)
The 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 Agent if the 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 Agent for that purpose.
(d)
Nothing in this Agreement shall oblige the Agent or the Arrangers to carry out:
(i)
any "know your customer" or other checks in relation to any person; or

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(ii)
any check on the extent to which any transaction contemplated by this Agreement might be unlawful for any Creditor Party,
on behalf of any Creditor Party and each Creditor Party confirms to the Agent and the Arrangers that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Agent or the Arrangers.
(e)
Without prejudice to any provision of any Finance Document excluding or limiting the Agent's liability, any liability of the Agent arising under or in connection with any Finance 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 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 Agent at any time which increase the amount of that loss. In no event shall the 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 Agent has been advised of the possibility of such loss or damages.
22.12
Lenders' indemnity to the 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 Agent, within three Business Days of demand, against any cost, loss or liability incurred by the Agent (otherwise than by reason of the Agent's gross negligence or wilful misconduct) in acting as Agent under the Finance Documents (unless the Agent has been reimbursed by the Borrower pursuant to a Finance Document).
(b)
Subject to paragraph (c) below, the Borrower shall immediately on demand reimburse any Lender for any payment that Lender makes to the Agent pursuant to paragraph (a) above.
(c)
Paragraph (b) above shall not apply to the extent that the indemnity payment in respect of which the Lender claims reimbursement relates to a liability of the Agent to the Borrower.
22.13
Resignation of the Agent
(a)
The Agent may resign and appoint one of its Affiliates acting through an office as successor by giving notice to the other Creditor Parties and the Borrower.
(b)
Alternatively, the Agent may resign by giving 30 days' notice to the other Creditor Parties and the Borrower, in which case the Majority Lenders (after consultation with the Borrower) may appoint as a successor Agent any reputable financial institution.
(c)
If the Majority Lenders have not appointed a successor Agent in accordance with paragraph (b) above within 20 days after notice of resignation was given, the retiring Agent (after consultation with the Borrower) may appoint as a successor Agent any reputable financial institution.
(d)
The retiring Agent shall make available to the successor Agent such documents and records and provide such assistance as the successor Agent may reasonably request for the purposes of performing its functions as Agent under the Finance Documents.
(e)
The Agent's resignation notice shall only take effect upon the appointment of a successor.
(f)
Upon the appointment of a successor, the retiring Agent shall be discharged from any further obligation in respect of the Finance Documents (other than its obligations under paragraph (d) above) but shall remain entitled to the benefit of Clause 20.1 ( Indemnities regarding borrowing

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and repayment of Loan ) and this Clause 22 ( The Agent, the Mandated Lead Arrangers 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 Agent. Any fees for the account of the retiring 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)
After consultation with the Borrower, the Majority Lenders may, by notice to the Agent, require it to resign in accordance with paragraph (b) above. In this event, the Agent shall resign in accordance with paragraph (b) above.
(h)
The consent of the Borrower is not required for an assignment or transfer of rights and/or obligations by the Agent.
(i)
The Agent shall resign in accordance with paragraph (b) above (and, to the extent applicable, shall use reasonable endeavours to appoint a successor Agent pursuant to paragraph (c) above) if on or after the date which is three months before the earliest FATCA Application Date relating to any payment to the Agent under the Finance Documents, either:
(i)
the Agent fails to respond to a request under Clause 21.8 ( FATCA information ) and a Lender reasonably believes that the 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 Agent pursuant to Clause 21.8 ( FATCA information ) indicates that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; or
(iii)
the Agent notifies the Borrower and the Lenders that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;
and (in each case) a Lender reasonably believes that a Party will be required to make a FATCA Deduction that would not be required if the Agent were a FATCA Exempt Party, and that Lender, by notice to the Agent, requires it to resign.
22.14
Confidentiality
(a)
In acting as Agent for the Creditor Parties, the 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 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 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 Agent nor the Mandated Lead Arrangers are 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.
22.15
Relationship with the other Creditor Parties

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(a)
The Agent may treat the person shown in its records as Lender or Swap Bank at the opening of business (in the place of the Agent's principal office as notified to the Creditor Parties from time to time) as the Lender acting through its Facility Office or, as the case may be, the Swap Bank:
(i)
entitled to or liable for any payment due under any Finance Document or Master Agreement 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 or Master Agreement made or delivered on that day,
unless it has received not less than five Business Days' prior notice from that Lender or Swap Bank to the contrary in accordance with the terms of this Agreement.
(b)
Each Creditor Party shall supply the Agent with any information that the Security Trustee may reasonably specify (through the Agent) as being necessary or desirable to enable the Security Trustee to perform its functions as Security Trustee. Each Creditor Party shall deal with the Security Trustee exclusively through the Agent and shall not deal directly with the Security Trustee and any reference to any instructions being given by or sought from any Creditor Party or group of Creditor Parties by or to the Security Trustee in this Agreement must be given or sought through the Agent.
(c)
Any Lender may by notice to the Agent appoint a person to receive on its behalf all notices, communications, information and documents to be made or despatched to that Lender under the Finance Documents. Such notice shall contain the address, fax number and (where communication by electronic mail or other electronic means is permitted under Clause 33.7 ( Electronic communication ) electronic mail address and/or any other information required to enable the transmission of information by that means (and, in each case, the department or officer, if any, for whose attention communication is to be made) and be treated as a notification of a substitute address, fax number, electronic mail address (or such other information), department and officer by that Lender for the purposes of Clause 33.2 ( Addresses for communications ) and Clause 33.7 ( Electronic communication ) and the Agent shall be entitled to treat such person as the person entitled to receive all such notices, communications, information and documents as though that person were that Lender.
22.16
Credit appraisal by the Creditor Parties
Without affecting the responsibility of the Borrower for information supplied by it or on its behalf in connection with any Document, each Creditor Party confirms to the Agent and the Arrangers that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under, or in connection with, any Document including but not limited to:
(a)
the financial condition, status and nature of each member of the Group;
(b)
the legality, validity, effectiveness, adequacy or enforceability of any Finance 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 Finance Document or the Security Property;
(c)
whether that Creditor 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 Finance Document, the Security Property, the transactions contemplated by the Finance Documents or any other

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agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance Document or the Security Property;
(d)
the adequacy, accuracy or completeness of any information provided by the Agent, any Party or by any other person under, or in connection with, any Finance Document, the transactions contemplated by any Finance Document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance 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.
22.17
Deduction from amounts payable by the Agent
If any Party owes an amount to the Agent under the Finance Documents, the Agent may, after giving notice to that Party, deduct an amount not exceeding that amount from any payment to that Party which the Agent would otherwise be obliged to make under the Finance Documents and apply the amount deducted in or towards satisfaction of the amount owed. For the purposes of the Finance Documents that Party shall be regarded as having received any amount so deducted.
22.18
Reliance and engagement letters
Each Secured Party confirms that each Arranger and the Agent has authority to accept on its behalf (and ratifies the acceptance on its behalf of any letters or reports already accepted by the Arrangers or the Agent) the terms of any reliance letter or engagement letters or any reports or letters provided by accountants, auditors or providers of due diligence reports in connection with the Finance Documents or the transactions contemplated in the Finance Documents and to bind it in respect of those, reports or letters and to sign such letters on its behalf and further confirms that it accepts the terms and qualifications set out in such letters.
22.19
Full freedom to enter into transactions
Without prejudice to Clause 22.7 ( Business with the Group ) or any other provision of a Finance Document and notwithstanding any rule of law or equity to the contrary, the Agent shall be absolutely entitled:
(a)
to enter into and arrange banking, derivative, investment and/or other transactions of every kind with or affecting the Borrower or any person who is party to, or referred to in, a Finance Document (including, but not limited to, any interest or currency swap or other transaction, whether related to this Agreement or not, and acting as syndicate agent and/or security trustee for, and/or participating in, other facilities to such Borrower or any person who is party to, or referred to in, a Finance Document);
(b)
to deal in and enter into and arrange transactions relating to:
(i)
any securities issued or to be issued by either Borrower 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 either Borrower or any person who is a party to, or referred to in, a Finance Document,

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and, in particular, the Agent shall be absolutely entitled, in proposing, evaluating, negotiating, entering into and arranging all such transactions and in connection with all other matters covered by paragraphs (a), (b) and (c) above, to use (subject only to insider dealing legislation) any information or opportunity, howsoever acquired by it, to pursue its own interests exclusively, to refrain from disclosing such dealings, transactions or other matters or any information acquired in connection with them and to retain for its sole benefit all profits and benefits derived from the dealings transactions or other matters.
23
THE SECURITY TRUSTEE
23.1
Trust
(a)
The Security Trustee declares that it holds the Security Property on trust for the Creditor Parties on the terms contained in this Agreement and shall deal with the Security Property in accordance with this Clause 23 ( The Security Trustee ) and the other provisions of the Finance Documents.
(b)
Each other Creditor Party authorises the Security Trustee to perform the duties, obligations and responsibilities and to exercise the rights, powers, authorities and discretions specifically given to the Security Trustee under, or in connection with, the Finance Documents together with any other incidental rights, powers, authorities and discretions.
23.2
Parallel Debt (Covenant to pay the Security Trustee)
(a)
Each Borrower irrevocably and unconditionally undertakes to pay to the Security Trustee its Parallel Debt which shall be amounts equal to, and in the currency or currencies of, its Corresponding Debt.
The Parallel Debt of each Borrower:
(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.
(b)
For purposes of this Clause 23.2 ( Parallel Debt (Covenant to pay the Security Trustee)) , the Security Trustee:
(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 Creditor Parties and its claims in respect of each Parallel Debt shall and any security granted to secure such claim 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).
(c)
The Parallel Debt of each Borrower 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,

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and the Corresponding Debt of each Borrower shall be:
(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,
in each case provided that the Parallel Debt of a Borrower shall never exceed its Corresponding Debt.
(d)
All amounts received or recovered by the Security Trustee in connection with this Clause 23.2 ( Parallel Debt (Covenant to pay the Security Trustee)) to the extent permitted by applicable law, shall be applied in accordance with Clause 16 ( Application of Receipts ).
(e)
This Clause 23.2 ( Parallel Debt (Covenant to pay the Security Trustee ) shall apply, with any necessary modifications, to each Finance Document.
23.3
Enforcement through Security Trustee only
The Creditor Parties shall not have any independent power to enforce, or have recourse to, any of the Transaction Security or to exercise any right, power, authority or discretion arising under the Finance Documents except through the Security Trustee.
23.4
Instructions
(a)
The Security Trustee 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 Trustee in accordance with any instructions given to it by:
(A)
all Lenders (or the Agent on their behalf) if the relevant Finance Document stipulates the matter is an all Lender decision; and
(B)
in all other cases, the Majority Lenders (or the Agent on their behalf); 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 Creditor Party or group of Creditor Parties, in accordance with instructions given to it by that Creditor Party or group of Creditor Parties).
(b)
The Security Trustee shall be entitled to request instructions, or clarification of any instruction, from the Majority Lenders (or the Agent on their behalf) (or, if the relevant Finance Document stipulates the matter is a decision for any other Creditor Party or group of Creditor Parties, from that Creditor Party or group of Creditor Parties) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the Security Trustee 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 Creditor Party or group of Creditor Parties under the relevant Finance Document and unless a contrary indication appears in a Finance Document, any instructions given to the Security Trustee by the Majority Lenders shall override any conflicting instructions given by any other Parties and will be binding on all Creditor Parties.

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(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 Trustee to act in a specified manner or to take a specified action;
(iii)
in respect of any provision which protects the Security Trustee's own position in its personal capacity as opposed to its role of Security Trustee for the relevant Secured Parties.
(iv)
in respect of the exercise of the Security Trustee's discretion to exercise a right, power or authority under any of:
(A)
Clause 23.28 ( Application of receipts );
(B)
Clause 23.29 ( Permitted Deductions ); and
(C)
Clause 23.30 ( Prospective liabilities ).
(e)
If giving effect to instructions given by the Majority Lenders would in the Security Trustee's opinion have an effect equivalent to an amendment or waiver referred to in Clause 32 ( Variations and Waivers ), the Security Trustee shall not act in accordance with those instructions unless consent to it so acting is obtained from each Party (other than the Security Trustee) 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,
the Security Trustee shall do so having regard to the interests of all the Creditor Parties.
(g)
The Security Trustee may refrain from acting in accordance with any instructions of any Creditor Party or group of Creditor 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 23.4 ( Instructions ), in the absence of instructions, the Security Trustee 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 Trustee is not authorised to act on behalf of a Creditor Party (without first obtaining that Creditor 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 Finance Documents or enforcement of the Finance Documents.
23.5
Duties of the Security Trustee

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(a)
The Security Trustee's duties under the Finance Documents are solely mechanical and administrative in nature.
(b)
The Security Trustee shall promptly forward to a Party the original or a copy of any document which is delivered to the Security Trustee for that Party by any other Party.
(c)
Except where a Finance Document specifically provides otherwise, the Security Trustee is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
(d)
If the Security Trustee 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 Creditor Parties.
(e)
The Security Trustee 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).
23.6
No fiduciary duties
(a)
Nothing in any Finance Document constitutes the Security Trustee as an agent, trustee or fiduciary of the Borrower.
(b)
The Security Trustee 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.
23.7
Business with the Group
The Security Trustee may accept deposits from, lend money to, and generally engage in any kind of banking or other business with, any member of either Group.
23.8
Rights and discretions
(a)
The Security Trustee 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 Creditor Parties or any group of Creditor 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:

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(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,
as sufficient evidence that that is the case and, in the case of paragraph (A) above, may assume the truth and accuracy of that certificate.
(b)
The Security Trustee shall be entitled to carry out all dealings with the other Creditor Parties through the Agent and may give to the Agent any notice or other communication required to be given by the Security Trustee to any Creditor Party.
(c)
The Security Trustee may assume (unless it has received notice to the contrary in its capacity as security trustee for the Creditor Parties) that:
(i)
no Event of Default has occurred; and
(ii)
any right, power, authority or discretion vested in any Party or any group of Creditor Parties has not been exercised.
(d)
The Security Trustee 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 Trustee may at any time engage and pay for the services of any lawyers to act as independent counsel to the Security Trustee (and so separate from any lawyers instructed by the Agent or the Lenders) if the Security Trustee in its reasonable opinion deems this to be desirable.
(f)
The Security Trustee may rely on the advice or services of any lawyers, accountants, tax advisers, surveyors or other professional advisers or experts (whether obtained by the Security Trustee or by any other Party) and shall not be liable for any damages, costs or losses to any person, any diminution in value or any liability whatsoever arising as a result of its so relying.
(g)
The Security Trustee 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,
unless such error or such loss was directly caused by the Security Trustee's gross negligence or wilful misconduct.
(h)
Unless a Finance Document expressly provides otherwise the Security Trustee may disclose to any other Party any information it reasonably believes it has received as security trustee under the Finance Documents.
(i)
Notwithstanding any other provision of any Finance Document to the contrary, the Security Trustee 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.

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(j)
Notwithstanding any provision of any Finance Document to the contrary, the Security Trustee 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.
23.9
Responsibility for documentation
None of the Security Trustee or any Receiver is responsible or liable for:
(a)
the adequacy, accuracy or completeness of any information (whether oral or written) supplied by the Agent, the Security Trustee, the Arrangers, the Borrowers or any other person in, or in connection with, any Finance Document or the transactions contemplated in the Finance Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance Document; or
(b)
the legality, validity, effectiveness, adequacy or enforceability of any Finance 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 Finance Document or the Security Property.
23.10
No duty to monitor
The Security Trustee shall not be bound to enquire:
(a)
whether or not any Event of Default has occurred;
(b)
as to the performance, default or any breach by either Borrower of its obligations under any Finance Document; or
(c)
whether any other event specified in any Finance Document has occurred.
23.11
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 Trustee or any Receiver), none of the Security Trustee nor any Receiver will be liable for:
(i)
any damages, costs or losses to any person, any diminution in value, or any liability whatsoever arising as a result of taking or not taking any action under or in connection with any Finance Document or the Security Property, unless directly caused by its gross negligence or wilful misconduct;
(ii)
exercising, or not exercising, any right, power, authority or discretion given to it by, or in connection with, any Finance 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 Finance 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:

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(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,
including (in each case and without limitation) such damages, costs, losses, diminution in value or liability arising as a result of nationalisation, expropriation or other governmental actions; any regulation, currency restriction, devaluation or fluctuation; market conditions affecting the execution or settlement of transactions or the value of assets (including any Disruption Event); breakdown, failure or malfunction of any third party transport, telecommunications, computer services or systems; natural disasters or acts of God; war, terrorism, insurrection or revolution; or strikes or industrial action.
(b)
No Party other than the Security Trustee or that Receiver (as applicable) may take any proceedings against any officer, employee or agent of the Security Trustee or a Receiver in respect of any claim it might have against the Security Trustee or a Receiver or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Finance Document or any Security Property.
(c)
The Security Trustee 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 Trustee if the Security Trustee 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 Trustee for that purpose.
(d)
Nothing in this Agreement shall oblige the Security Trustee 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 Creditor Party,
on behalf of any Creditor Party and each Creditor Party confirms to the Security Trustee that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Security Trustee.
(e)
Without prejudice to any provision of any Finance Document excluding or limiting the liability of the Security Trustee or any Receiver, any liability of the Security Trustee or any Receiver arising under or in connection with any Finance 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 Trustee or Receiver 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 Trustee or any Receiver at any time which increase the amount of that loss. In no event shall the Security Trustee or any Receiver 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 Trustee or the Receiver has been advised of the possibility of such loss or damages.
23.12
Lenders' indemnity to the Security Trustee
(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 Trustee and every Receiver, within three Business Days of demand, against any cost, loss or liability incurred by any of them (otherwise than by reason of the Security Trustee's or Receiver's gross negligence or wilful misconduct) in acting as Security

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Trustee or Receiver under the Finance Documents (unless the Security Trustee or Receiver has been reimbursed by the Borrower 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 Trustee pursuant to paragraph (a) above.
(c)
Paragraph (b) above shall not apply to the extent that the indemnity payment in respect of which the Lender claims reimbursement relates to a liability of the Security Trustee to the Borrower.
23.13
Resignation of the Security Trustee
(a)
The Security Trustee may resign and appoint one of its Affiliates acting through an office as successor by giving notice to the other Creditor Parties and the Borrowers.
(b)
Alternatively, the Security Trustee may resign by giving 30 days' notice to the other Creditor Parties and the Borrowers, in which case the Majority Lenders (after consultation with the Borrower) may appoint as a successor Security Trustee any reputable financial institution.
(c)
If the Majority Lenders have not appointed a successor Security Trustee in accordance with paragraph (b) above within 20 days after notice of resignation was given, the retiring Security Trustee (after consultation with the Borrowers) may appoint as a successor Security Trustee any reputable financial institution.
(d)
The retiring Security Trustee shall make available to the successor Security Trustee such documents and records and provide such assistance as the successor Security Trustee may reasonably request for the purposes of performing its functions as Security Trustee under the Finance Documents. The Borrowers shall, within three Business Days of demand, reimburse the retiring Security Trustee for the amount of all costs and expenses (including legal fees) properly incurred by it in making available such documents and records and providing such assistance.
(e)
The Security Trustee'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 Trustee 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 23.25 ( Winding up of trust ) and paragraph (d) above) but shall remain entitled to the benefit of Clause 20.1 ( Indemnities regarding borrowing and repayment of Loan ) and this Clause 23 ( The Security Trustee ) 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 Trustee. Any fees for the account of the retiring Security Trustee 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 Trustee, require it to resign in accordance with paragraph (b) above. In this event, the Security Trustee shall resign in accordance with paragraph (b) above but the cost referred to in paragraph (d) above shall be for the account of the Borrower.

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(h)
The consent of the Borrower is not required for an assignment or transfer of rights and/or obligations by the Security Trustee.
23.14
Confidentiality
(a)
In acting as Security Trustee for the Creditor Parties, the Security Trustee 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 Trustee 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 Trustee 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 Trustee 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.
23.15
Credit appraisal by the Creditor Parties
Without affecting the responsibility of the Borrower for information supplied by it or on its behalf in connection with any Finance Document, each Creditor Party confirms to the Security Trustee that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under, or in connection with, any Finance Document including but not limited to:
(a)
the financial condition, status and nature of each member of each Group;
(b)
the legality, validity, effectiveness, adequacy or enforceability of any Finance 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 Finance Document or the Security Property;
(c)
whether that Creditor 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 Finance Document, the Security Property, the transactions contemplated by the Finance Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance Document or the Security Property;
(d)
the adequacy, accuracy or completeness of any information provided by the Security Trustee, any Party or by any other person under, or in connection with, any Finance Document, the transactions contemplated by any Finance Document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance 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.
23.16
Security Trustee's management time
(a)
In the event of:

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(i)
an Event of Default;
(ii)
the Security Trustee being requested by the Borrower or the Majority Lenders to undertake duties which the Security Trustee and the Borrower agree to be of an exceptional nature or outside the scope of the normal duties of the Security Trustee under the Finance Documents; or
(iii)
the Security Trustee and the Borrowers agreeing that it is otherwise appropriate in the circumstances,
the Borrowers shall pay to the Security Trustee any additional remuneration (together with any applicable VAT) that may be agreed between them or determined pursuant to paragraph (b) below.
(b)
If the Security Trustee and the Borrowers fail to agree upon the nature of the duties, or upon the additional remuneration referred to in paragraph (a) above or whether additional remuneration is appropriate in the circumstances, any dispute shall be determined by an investment bank (acting as an expert and not as an arbitrator) selected by the Security Trustee and approved by the Borrowers or, failing approval, nominated (on the application of the Security Trustee) by the President for the time being of the Law Society of England and Wales (the costs of the nomination and of the investment bank being payable by the Borrowers) and the determination of any investment bank shall be final and binding upon the Parties.
23.17
Reliance and engagement letters
Each Secured Party confirms that the Security Trustee has authority to accept on its behalf (and ratifies the acceptance on its behalf of any letters or reports already accepted by the Security Trustee) the terms of any reliance letter or engagement letters or any reports or letters provided by accountants, auditors or providers of due diligence reports in connection with the Finance Documents or the transactions contemplated in the Finance Documents and to bind it in respect of those, reports or letters and to sign such letters on its behalf and further confirms that it accepts the terms and qualifications set out in such letters.
23.18
No responsibility to perfect Transaction Security
The Security Trustee shall not be liable for any failure to:
(a)
require the deposit with it of any deed or document certifying, representing or constituting the title of the Borrower 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 the Borrowers 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 Finance Document.
23.19
Insurance by Security Trustee

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(a)
The Security Trustee 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,
and the Security Trustee shall not be liable for any damages, costs or losses to any person as a result of the lack of, or inadequacy of, any such insurance.
(b)
Where the Security Trustee 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 Trustee fails to do so within 14 days after receipt of that request.
23.20
Custodians and nominees
The Security Trustee may appoint and pay any person to act as a custodian or nominee on any terms in relation to any asset of the trust as the Security Trustee may determine, including for the purpose of depositing with a custodian this Agreement or any document relating to the trust created under this Agreement and the Security Trustee shall not be responsible for any loss, liability, expense, demand, cost, claim or proceedings incurred by reason of the misconduct, omission or default on the part of any person appointed by it under this Agreement or be bound to supervise the proceedings or acts of any person.
23.21
Delegation by the Security Trustee
(a)
Each of the Security Trustee and any Receiver 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 Trustee or that Receiver (as the case may be) may, in its discretion, think fit in the interests of the Secured Parties.
(c)
No Security Trustee or Receiver 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.
23.22
Additional Security Trustees
(a)
The Security Trustee 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 Creditor Parties; or
(ii)
for the purposes of conforming to any legal requirement, restriction or condition which the Security Trustee deems to be relevant; or
(iii)
for obtaining or enforcing any judgment in any jurisdiction,

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and the Security Trustee shall give prior notice to the Borrower and the Creditor Parties of that appointment.
(b)
Any person so appointed shall have the rights, powers, authorities and discretions (not exceeding those given to the Security Trustee 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 Trustee may pay to that person (after consultation with the Borrower), 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 Trustee.
23.23
Acceptance of title
The Security Trustee shall be entitled to accept without enquiry, and shall not be obliged to investigate, any right and title that the Borrower may have to any of the Security Assets and shall not be liable for or bound to require the Borrower to remedy any defect in its right or title.
23.24
Releases
Upon a disposal of any of the Security Assets pursuant to the enforcement of the Transaction Security by a Receiver or the Security Trustee, the Security Trustee is irrevocably authorised (at the cost of the Borrower and without any consent, sanction, authority or further confirmation from any other Creditor Party) to release, without recourse or warranty, that property from the Transaction Security and to execute any release of the Transaction Security or other claim over that asset and to issue any certificates of non-crystallisation of floating charges that may be required or desirable.
23.25
Winding up of trust
If the Security Trustee, with the approval of the Agent determines that:
(a)
all of the Secured Liabilities and all other obligations secured by the Finance Documents have been fully and finally discharged; and
(b)
no Secured Party is under any commitment, obligation or liability (actual or contingent) to make advances or provide other financial accommodation to the Borrower pursuant to the Finance Documents,
then
(i)
the trusts set out in this Agreement shall be wound up and the Security Trustee shall release, without recourse or warranty, all of the Transaction Security and the rights of the Security Trustee under each of the Finance Documents; and
(ii)
any Security Trustee which has resigned pursuant to Clause 23.13 ( Resignation of the Security Trustee ) shall release, without recourse or warranty, all of its rights under each Finance Document.
23.26
Powers supplemental to Trustee Acts
The rights, powers, authorities and discretions given to the Security Trustee under or in connection with the Finance Documents shall be supplemental to the Trustee Act 1925 and the Trustee Act

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2000 and in addition to any which may be vested in the Security Trustee by law or regulation or otherwise.
23.27
Disapplication of Trustee Acts
Section 1 of the Trustee Act 2000 shall not apply to the duties of the Security Trustee in relation to the trusts constituted by this Agreement and the other Finance Documents. Where there are any inconsistencies between (i) the Trustee Acts 1925 and 2000 and (ii) the provisions of this Agreement and any other Finance Document, the provisions of this Agreement and any other Finance Document shall, to the extent permitted by law and regulation, prevail and, in the case of any inconsistency with the Trustee Act 2000, the provisions of this Agreement and any other Finance Document shall constitute a restriction or exclusion for the purposes of the Trustee Act 2000.
23.28
Application of receipts
All amounts from time to time received or recovered by the Security Trustee pursuant to the terms of any Finance Document, under Clause 23.2 ( Parallel Debt (Covenant to pay the Security Trustee) ) or in connection with the realisation or enforcement of all or any part of the Security Property (for the purposes of this Clause 23 ( The Security Trustee ), the " Recoveries ") shall be held by the Security Trustee on trust to apply them at any time as the Security Trustee (in its discretion) sees fit, to the extent permitted by applicable law (and subject to the remaining provisions of this Clause 23 ( The Security Trustee ), in the following order of priority:
(a)
in discharging any sums owing to the Security Trustee (in its capacity as such) (other than pursuant to Clause 23.2 ( Parallel Debt (Covenant to pay the Security Trustee) ) or any Receiver;
(b)
in payment or distribution to the Agent, on its behalf and on behalf of the other Creditor Parties, for application towards the discharge of all sums due and payable by the Borrower under any of the Finance Documents in accordance with Clause 16 ( Application of Receipts );
(c)
if neither Borrower is under any further actual or contingent liability under any Finance Document, in payment or distribution to any person to whom the Security Trustee is obliged to pay or distribute in priority to the Borrowers; and
(d)
the balance, if any, in payment or distribution to the Borrowers.
23.29
Permitted Deductions
The Security Trustee may, in its discretion:
(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 Trustee under any of the Finance Documents or otherwise (other than in connection with its remuneration for performing its duties under this Agreement).
23.30
Prospective liabilities
Following acceleration the Security Trustee may, in its discretion, or at the request of the Agent, hold any Recoveries in an interest bearing suspense or impersonal account(s) in the name of the

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Security Trustee with such financial institution (including itself) and for so long as the Security Trustee shall think fit (the interest being credited to the relevant account) for later payment to the Agent for application in accordance with Clause 23.28 ( Application of receipts ) in respect of:
(a)
any sum to the Security Trustee or any Receiver; and
(b)
any part of the Secured Liabilities,
that the Security Trustee or, in the case of paragraph (b) only, the Agent, reasonably considers, in each case, might become due or owing at any time in the future.
23.31
Investment of proceeds
Prior to the payment of the proceeds of the Recoveries to the Agent for application in accordance with Clause 23.28 ( Application of receipts ) the Security Trustee may, in its discretion, hold all or part of those proceeds in an interest bearing suspense or impersonal account(s) in the name of the Security Trustee with such financial institution (including itself) and for so long as the Security Trustee shall think fit (the interest being credited to the relevant account) pending the payment from time to time of those moneys in the Security Trustee's discretion in accordance with the provisions of Clause 23.28 ( Application of receipts ).
23.32
Currency conversion
(a)
For the purpose of, or pending the discharge of, any of the Secured Liabilities the Security Trustee may convert any moneys received or recovered by the Security Trustee from one currency to another, at a market rate of exchange.
(b)
The obligations of the Borrowers 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.
23.33
Good discharge
(a)
Any payment to be made in respect of the Secured Liabilities by the Security Trustee may be made to the Agent on behalf of the Creditor Parties and any payment made in that way shall be a good discharge, to the extent of that payment, by the Security Trustee.
(b)
The Security Trustee is under no obligation to make the payments to the Agent under paragraph (a) above in the same currency as that in which the obligations and liabilities owing to the relevant Creditor Party are denominated.
23.34
Amounts received by Borrowers
If a Borrower receives or recovers any amount which, under the terms of any of the Finance Documents, should have been paid to the Security Trustee, that Borrower will hold the amount received or recovered on trust for the Security Trustee and promptly pay that amount to the Security Trustee for application in accordance with the terms of this Agreement.
23.35
Full freedom to enter into transactions
Without prejudice to Clause 23.7 ( Business with the Group ) or any other provision of a Finance Document and notwithstanding any rule of law or equity to the contrary, the Security Trustee shall be absolutely entitled:

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(a)
to enter into and arrange banking, derivative, investment and/or other transactions of every kind with or affecting a Borrower or any person who is party to, or referred to in, a Finance Document (including, but not limited to, any interest or currency swap or other transaction, whether related to this Agreement or not, and acting as syndicate agent and/or security trustee for, and/or participating in, other facilities to such Borrower or any person who is party to, or referred to in, a Finance Document);
(b)
to deal in and enter into and arrange transactions relating to:
(i)
any securities issued or to be issued by either Borrower 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 either Borrower or any person who is a party to, or referred to in, a Finance Document,
and, in particular, the Security Trustee shall be absolutely entitled, in proposing, evaluating, negotiating, entering into and arranging all such transactions and in connection with all other matters covered by paragraphs (a), (b) and (c) above, to use (subject only to insider dealing legislation) any information or opportunity, howsoever acquired by it, to pursue its own interests exclusively, to refrain from disclosing such dealings, transactions or other matters or any information acquired in connection with them and to retain for its sole benefit all profits and benefits derived from the dealings transactions or other matters.
24
CONDUCT OF BUSINESS BY THE CREDITOR PARTIES
No provision of this Agreement will:
(a)
interfere with the right of any Creditor Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
(b)
oblige any Creditor Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
oblige any Creditor Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax.
25
SHARING AMONG THE CREDITOR PARTIES
25.1
Payments to Creditor Parties
If a Creditor Party (a " Recovering Creditor Party ") receives or recovers any amount from a Borrower other than in accordance with Clause 15 ( Payments and Calculations ) (a " Recovered Amount ") and applies that amount to a payment due to it under the Finance Documents then:
(a)
the Recovering Creditor Party shall, within three Business Days, notify details of the receipt or recovery, to the Agent;
(b)
the Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Creditor Party would have been paid had the receipt or recovery been received or made by the Agent and distributed in accordance with Clause 15 ( Payments and Calculations ), without taking account of any Tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and

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(c)
the Recovering Creditor Party shall, within three Business Days of demand by the Agent, pay to the Agent an amount (the " Sharing Payment ") equal to such receipt or recovery less any amount which the Agent determines may be retained by the Recovering Creditor Party as its share of any payment to be made, in accordance with Clause 16.1 ( Normal order of application ).
25.2
Redistribution of payments
The Agent shall treat the Sharing Payment as if it had been paid by the Borrowers and distribute it among the Creditor Parties (other than the Recovering Creditor Party) (the " Sharing Creditor Parties ") in accordance with Clause 16.1 ( Normal order of application ) towards the obligations of the Borrower to the Sharing Creditor Parties.
25.3
Recovering Creditor Party's rights
On a distribution by the Agent under Clause 25.2 ( Redistribution of payments ) of a payment received by a Recovering Creditor Party from a Borrower, as between that Borrower and the Recovering Creditor Party, an amount of the Recovered Amount equal to the Sharing Payment will be treated as not having been paid by that Borrower.
25.4
Reversal of redistribution
If any part of the Sharing Payment received or recovered by a Recovering Creditor Party becomes repayable and is repaid by that Recovering Creditor Party, then:
(a)
each Sharing Creditor Party shall, upon request of the Agent, pay to the Agent for the account of that Recovering Creditor 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 Creditor Party for its proportion of any interest on the Sharing Payment which that Recovering Creditor Party is required to pay) (the " Redistributed Amount "); and
(b)
as between the Borrowers and each relevant Sharing Creditor Party, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrowers.
25.5
Exceptions
(a)
This Clause 25 ( Sharing among the Creditor Parties ) shall not apply to the extent that the Recovering Creditor Party would not, after making any payment pursuant to this Clause, have a valid and enforceable claim against the Borrower.
(b)
A Recovering Creditor Party is not obliged to share with any other Creditor Party any amount which the Recovering Creditor Party has received or recovered as a result of taking legal or arbitration proceedings, if:
(i)
it notified that other Creditor Party of the legal or arbitration proceedings; and
(ii)
that other Creditor 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.
26
ILLEGALITY, ETC
26.1
Illegality

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This Clause 26 ( Illegality, etc ) applies if a Lender (the " Notifying Lender ") notifies the Agent that it has become, or will with effect from a specified date, become:
(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 and/or contrary to or declared by any Sanctions Authority to be contrary to Sanctions Laws,
for the Notifying Lender to maintain or give effect to any of its obligations under this Agreement in the manner contemplated by this Agreement.
26.2
Notification of illegality
The Agent shall promptly notify the Borrowers, the Security Parties, the Security Trustee and the other Lenders of the notice under Clause 26.1 ( Illegality ) which the Agent receives from the Notifying Lender.
26.3
Prepayment; termination of Commitment
On the Agent notifying the Borrowers under Clause 26.2 ( Notification of illegality ), the Notifying Lender's Commitment shall terminate; and thereupon or, if later, on the date specified in the Notifying Lender's notice under Clause 26.1 ( Illegality ) as the date on which the notified event would become effective the Borrowers shall prepay the Notifying Lender's Contribution in accordance with Clause 8 ( Repayment of Prepayment and cancellation ).
26.4
Mitigation
If circumstances arise which would result in a notification under Clause 26.1 ( Illegality ) then, without in any way limiting the rights of the Notifying Lender under Clause 26.3 ( Prepayment; termination of Commitment ), the Notifying Lender shall use reasonable endeavours to transfer its obligations, liabilities and rights under this Agreement and the Finance Documents to another office or financial institution not affected by the circumstances but the Notifying Lender shall not be under any obligation to take any such action if, in its opinion, to do would or might:
(a)
have an adverse effect on its business, operations or financial condition; or
(b)
involve it in any activity which is unlawful or prohibited or any activity that is contrary to, or inconsistent with, any regulation; or
(c)
involve it in any expense (unless indemnified to its satisfaction) or tax disadvantage.
27
INCREASED COSTS
27.1
Increased costs
This Clause 27 ( Increased Costs ) applies if a Lender (the " Notifying Lender ") notifies the Agent that the Notifying Lender considers that as a result of:
(a)
the introduction or alteration or compliance after the date of this Agreement of a law or an alteration after the date of this Agreement in the manner in which a law is interpreted or applied (disregarding any effect which relates to the application to payments under this Agreement of a tax on the Lender's overall net income); or

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(b)
complying with any regulation (including any which relates to capital adequacy or liquidity controls or which affects the manner in which the Notifying Lender allocates capital resources to its obligations under this Agreement) which is introduced, or altered, or the interpretation or application of which is altered, after the date of this Agreement,
the Notifying Lender (or a parent company of it or any of its subsidiaries) has incurred or will incur an " increased cost ", together with a certificate of the Notifying Lender specifying the amount of such increased cost and an explanation in reasonable detail of the reasons for such increased costs and, in general terms, how it was calculated.
27.2
Meaning of "increased cost"
In this Clause 27 ( Increased Costs ), " increased cost " means, in relation to a Notifying Lender:
(a)
an additional or increased cost incurred as a result of, or in connection with, the Notifying Lender having entered into, or being a party to, this Agreement or a Transfer Certificate, of funding or maintaining its Commitment or Contribution or performing its obligations under this Agreement, or of having outstanding all or any part of its Contribution or other unpaid sums;
(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;
(c)
an additional or increased cost of funding all or maintaining all or any of the advances comprised in a class of advances formed by or including the Notifying Lender's Contribution or (as the case may require) the proportion of that cost attributable to the Contribution;
(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; or
(e)
an additional or increased cost incurred as a result of 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,
but, in the case of paragraphs (a) to (d) not an item attributable to:
(i)
a change in the rate of tax on the overall net income of the Notifying Lender (or a parent company of it) or an item covered by the indemnity for tax in Clause 20.1 ( Indemnities regarding borrowing and repayment of Loan ) or by Clause 20 ( Indemnities ) or an item arising directly out of the implementation or application of or compliance with the "International Convergence of Capital Measurement and Capital Standards, a Revised Framework" published by the Basel Committee on Banking Supervision in June 2004, in the form existing on the date of this Agreement (" Basel II ") or any other law or regulation which implements Basel II (whether such implementation, application or compliance is by a government, regulator, Creditor Party or any of its affiliates; or
(ii)
a FATCA Deduction required to be made by any party to a Finance Document.
For the purposes of this Clause 27.2 ( Meaning of "increased cost" ) the Notifying Lender (or its subsidiaries) may in good faith allocate or spread costs and/or losses among its assets and liabilities (or any class of its assets and liabilities) on such basis as it considers appropriate.
27.3
Notification to Borrowers of claim for increased costs

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The Agent shall promptly notify the Borrowers and the Security Parties of the notice together with the applicable certificate which the Agent received from the Notifying Lender under Clause 27.1 ( Increased costs ) and there shall then be a 60 day consultation period for the Borrowers and Notifying Lender to discuss the particular increased cost and amount to be paid to the Notifying Lender.
27.4
Payment of increased costs
Unless something to the contrary is agreed by the Borrowers and the Notifying Lender during the 60 day consultation period referred to in Clause 27.3 ( Notification to Borrowers of claim for increased costs ), the Borrowers shall pay to the Agent, on the Agent's demand, for the account of the Notifying Lender the amounts which the Agent from time to time notifies the Borrowers that the Notifying Lender has specified to be necessary to compensate the Notifying Lender for the increased cost.
27.5
Notice of prepayment
If the Borrowers are not willing to continue to compensate the Notifying Lender for the increased cost under Clause 27.4 ( Payment of increased costs ), the Borrowers may give the Agent not less than 14 days' notice of their intention to prepay the Notifying Lender's Contribution at the end of an Interest Period.
27.6
Prepayment; termination of Commitment
A notice under Clause 27.5 ( Notice of prepayment ) shall be irrevocable; the Agent shall promptly notify the Notifying Lender of the Borrowers' notice of intended prepayment; and:
(a)
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall be cancelled; and
(b)
on the date specified in its notice of intended prepayment, the Borrowers shall prepay (without premium or penalty) the Notifying Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin.
27.7
Application of prepayment
Clause 8 ( Repayment of Prepayment and cancellation ) shall apply in relation to the prepayment.
28
SET-OFF
28.1
Application of credit balances
Each Creditor Party may, after the occurrence of an Event of Default which is continuing, without prior notice:
(a)
apply any balance (whether or not then due) which at any time stands to the credit of any account in the name of a Borrower at any office in any country of that Creditor Party in or towards satisfaction of any sum then due from that Borrower to that Creditor Party under any of the Finance Documents; and
(b)
for that purpose:
(i)
break, or alter the maturity of, all or any part of a deposit of that Borrower;

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(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.
28.2
Existing rights unaffected
No Creditor Party shall be obliged to exercise any of its rights under Clause 28.1 ( Application of credit balances ); 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 a Creditor Party is entitled (whether under the general law or any document).
28.3
Sums deemed due to a Lender
For the purposes of this Clause 28 ( Set-Off ), a sum payable by the Borrowers to the Agent or the Security Trustee for distribution to, or for the account of, a Lender shall be treated as a sum due to that Lender; and each Lender's proportion of a sum so payable for distribution to, or for the account of, the Lenders shall be treated as a sum due to such Lender.
28.4
No Security Interest
This Clause 28 ( Set-Off ) gives the Creditor Parties a contractual right of set-off only, and does not create any equitable charge or other Security Interest over any credit balance of any Borrower.
29
TRANSFERS AND CHANGES IN LENDING OFFICES
29.1
Transfer by Borrowers
No Borrower may, without the consent of the Agent, given on the instructions of all the Lenders transfer any of its rights, liabilities or obligations under any Finance Document.
29.2
Transfer by a Lender
Subject to Clause 29.4 ( Effective Date of Transfer Certificate ), a Lender (the " Transferor Lender ") may at any time, with the prior written consent of the Borrowers (not to be unreasonably withheld or delayed, and the Borrower will be deemed to have given its consent five Business Days after the Transferor Lender has requested it unless consent is expressly refused by the Borrower within that time) or without the consent of the Borrowers if an Event of Default has occurred and is continuing or if such transfer is to an affiliate of the Transferor Lender, cause:
(a)
its rights in respect of all or part of its Contribution; or
(b)
its obligations in respect of all or part of its Commitment; or
(c)
a combination of (a) and (b),
to be (in the case of its rights) transferred to, or (in the case of its obligations) assumed by, another bank or financial institution or a trust, fund or other entity which is regularly engaged in or established for the purpose of making, purchasing or investing in loans, securities or other financial assets (a " Transferee Lender ") by delivering to the Agent a completed certificate in the form set out in Schedule 6 ( Transfer Certificate ) with any modifications approved or required by the Agent (a " Transfer Certificate ") executed by the Transferor Lender and the Transferee Lender.

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However any rights and obligations of the Transferor Lender in its capacity as Agent or Security Trustee will have to be dealt with separately in accordance with Clause 22 ( The Agent, the Mandated Lead Arrangers and the Reference Banks ).
29.3
Transfer Certificate, delivery and notification
As soon as reasonably practicable after a Transfer Certificate is delivered to the Agent, it shall (unless it has reason to believe that the Transfer Certificate may be defective):
(a)
sign the Transfer Certificate on behalf of itself, the Borrowers, the Security Parties, the Security Trustee, the Arrangers, each of the other Lenders and each of the Swap Banks;
(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,
but the Agent shall only be obliged to execute a Transfer Certificate delivered to it by the Transferor Lender and the Transferee Lender once it is satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations in relation to the transfer to that Transferee Lender.
29.4
Effective Date of Transfer Certificate
A Transfer Certificate becomes effective on the date, if any, specified in the Transfer Certificate as its effective date, Provided that it is signed by the Agent under Clause 29.3 ( Transfer Certificate, delivery and notification ) on or before that date.
29.5
No transfer without Transfer Certificate
No assignment or transfer of any right or obligation of a Lender under any Finance Document is binding on, or effective in relation to, any Borrower, any Security Party, the Agent or the Security Trustee unless it is effected, evidenced or perfected by a Transfer Certificate.
29.6
Lender re-organisation; waiver of Transfer Certificate
However, if a Lender enters into any merger, de-merger or other reorganisation as a result of which all its rights or obligations vest in another person (the " successor "), the Agent may, if it sees fit, by notice to the successor and the Borrowers and the Security Trustee waive the need for the execution and delivery of a Transfer Certificate; and, upon service of the Agent's notice, the successor shall become a Lender with the same Commitment and Contribution as were held by the predecessor Lender.
29.7
Effect of Transfer Certificate
A Transfer Certificate takes effect in accordance with English law as follows:
(a)
to the extent specified in the Transfer Certificate, all rights and interests (present, future or contingent) which the Transferor Lender has under or by virtue of the Finance Documents are assigned to the Transferee Lender absolutely, free of any defects in the Transferor Lender's title and of any rights or equities which any Borrower or any Security Party had against the Transferor Lender;

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(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;
(d)
the Transferee Lender becomes bound by all the provisions of the Finance Documents which are applicable to the Lenders generally, including those about pro‑rata sharing and the exclusion of liability on the part of, and the indemnification of, the Agent and the Security Trustee and, to the extent that the Transferee Lender becomes bound by those provisions (other than those relating to exclusion of liability), the Transferor Lender ceases to be bound by them;
(e)
any part of the Loan which the Transferee Lender advances after the Transfer Certificate's effective date ranks in point of priority and security in the same way as it would have ranked had it been advanced by the transferor, assuming that any defects in the transferor's title and any rights or equities of any Borrower or any Security Party against the Transferor Lender had not existed;
(f)
the Transferee Lender becomes entitled to all the rights under the Finance Documents which are applicable to the Lenders generally, including but not limited to those relating to the Majority Lenders and those under Clause 5.9 ( Market disruption ) and Clause 19 ( Fees and Expenses ), and to the extent that the Transferee Lender becomes entitled to such rights, the Transferor Lender ceases to be entitled to them; and
(g)
in respect of any breach of a warranty, undertaking, condition or other provision of a Finance Document or any misrepresentation made in or in connection with a Finance Document, the Transferee Lender shall be entitled to recover damages by reference to the loss incurred by it as a result of the breach or misrepresentation, irrespective of whether the original Lender would have incurred a loss of that kind or amount.
The rights and equities of any Borrower or any Security Party referred to above include, but are not limited to, any right of set off and any other kind of cross-claim.
29.8
Maintenance of register of Lenders
During the Security Period the Agent shall maintain a register in which it shall record the name, Commitment, Contribution and administrative details (including the lending office) from time to time of each Lender holding a Transfer Certificate and the effective date (in accordance with Clause 29.4 ( Effective Date of Transfer Certificate )) of the Transfer Certificate; and the Agent shall make the register available for inspection by any Lender, the Security Trustee and the Borrowers during normal banking hours, subject to receiving at least 3 Business Days' prior notice.
29.9
Reliance on register of Lenders
The entries on that register shall, in the absence of manifest error, be conclusive in determining the identities of the Lenders and the amounts of their Commitments and Contributions and the effective dates of Transfer Certificates and may be relied upon by the Agent and the other parties to the Finance Documents for all purposes relating to the Finance Documents.
29.10
Authorisation of Agent to sign Transfer Certificates
Each Borrower, the Security Trustee, each Arranger, each Lender and each Swap Bank irrevocably authorises the Agent to sign Transfer Certificates on its behalf.

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29.11
Registration fee
In respect of any Transfer Certificate, the Agent shall be entitled to recover a registration fee of $3,000 from the Transferor Lender or (at the Agent's option) the Transferee Lender.
29.12
Sub-participation; subrogation assignment
A Lender may sub-participate all or any part of its rights and/or obligations under or in connection with the Finance Documents without the consent of, or any notice to, any Borrower, any Security Party, the Agent or the Security Trustee; and the Lenders may assign, in any manner and terms agreed by the Majority Lenders, the Agent and the Security Trustee, all or any part of those rights to an insurer or surety who has become subrogated to them.
29.13
Change of lending office
A Lender may change its lending office by giving notice to the Agent and the change shall become effective on the later of:
(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.
29.14
Notification
On receiving such a notice, the Agent shall notify the Borrowers and the Security Trustee; and, until the Agent receives such a notice, it shall be entitled to assume that a Lender is acting through the lending office of which the Agent last had notice.
29.15
Replacement of Reference Bank
If any Reference Bank ceases to be a Lender or is unable on a continuing basis to supply quotations for the purposes of Clause 5 ( Interest ) then, unless the Borrowers, the Agent and the Majority Lenders otherwise agree, the Agent, acting on the instructions of the Majority Lenders, and after consulting the Borrowers, shall appoint another bank (whether or not a Lender) to be a replacement Reference Bank; and, when that appointment comes into effect and provided that such bank has consented to its appointment, the first-mentioned Reference Bank's appointment shall cease to be effective.
29.16
Tax indemnity, tax gross-up and increased costs on assignment, transfer and change of lending office
If:
(a)
a Lender assigns or transfers any rights or obligations under the Finance Documents pursuant to Clause 29.2 ( Transfer by a Lender ) or changes its lending office; and
(b)
as a result of circumstances existing at the date of assignment, transfer or change occurs the Borrowers would be obliged to make a payment to the Transferee Lender or Lender acting through its new lending office under Clause 20.1 ( Indemnities regarding borrowing and repayment of Loan ) in respect of any tax, Clause 27 ( Increased Costs ) or Clause 28 ( Set-Off ),
then the Transferee Lender or the Lender acting through its new lending office is only entitled to receive payment under those Clauses to the same extent as the Transferor Lender or the Lender

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acting through its previous lending office would have been if the assignment, transfer or change had not occurred
29.17
Security over Lenders' rights
In addition to the other rights provided to Lenders under this Clause 29 ( Transfers and Changes in Lending Offices ) , each Lender may, in order to secure obligations of that Lender to a federal reserve or central bank and without consulting with or obtaining consent from either Borrower or any Security Party, at any time charge, assign or otherwise create Security Interests in or over (whether by way of collateral or otherwise) all or any of its rights under any Finance Document provided that no such charge, assignment or Security Interest shall:
(a)
release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or other Security Interest for the Lender as a party to any of the Finance Documents; or
(b)
require any payments to be made by a Borrower or any Security Party or grant to any person any rights which are more extensive than those required to be made or granted to the relevant Lender under the Finance Documents.
30
CONFIDENTIAL INFORMATION
30.1
Confidentiality
Each Creditor Party agrees to keep all Confidential Information confidential and not to disclose it to anyone, save to the extent permitted by Clause 30.2 ( Disclosure of Confidential Information ) and Clause 30.3 ( Disclosure to numbering service providers ) and to ensure that all Confidential Information is protected with security measures and a degree of care that would apply to its own confidential information.
30.2
Disclosure of Confidential Information
Any Creditor Party may disclose:
(a)
to any of its Affiliates and Related Funds and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives such Confidential Information as that Creditor Party 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 transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents or which succeeds (or which may potentially succeed) it as Agent or Security Trustee 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

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and/or the Borrower and to any of that person's Affiliates, Related Funds, Representatives and professional advisers;
(iii)
appointed by any Creditor Party 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 (including, without limitation, any person appointed under paragraph (c) of Clause 22.15 ( Relationship with the other Creditor Parties );
(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 that Creditor Party charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 29.17 ( Security over Lenders' rights );
(viii)
who is a Party, a member of either Group or any related entity of the Borrower;
(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 Borrower;
in each case, such Confidential Information as that Creditor Party shall consider appropriate if:
(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 Creditor Party, it is not practicable so to do in the circumstances;

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(c)
to any person appointed by that Creditor Party 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 Borrower and the relevant Creditor Party.
30.3
Disclosure to numbering service providers
(a)
Any Creditor Party may disclose to any national or international numbering service provider appointed by that Creditor Party to provide identification numbering services in respect of this Agreement, the Loan and/or the Borrower the following information:
(i)
name of Borrower;
(ii)
country of domicile of Borrower;
(iii)
place of incorporation of Borrower;
(iv)
date of this Agreement;
(v)
Clause 36 ( Law and Jurisdiction );
(vi)
the names of the Agent and the Arrangers;
(vii)
date of each amendment and restatement of this Agreement;
(viii)
amounts of, and names of, the relevant Loan;
(ix)
amount of Total Commitments;
(x)
currency of the relevant Loan;
(xi)
type of the relevant Loan;
(xii)
ranking of the relevant Loan;
(xiii)
Maturity Date(s) for the Loan;
(xiv)
changes to any of the information previously supplied pursuant to sub-paragraphs (i) to (xiii) above; and
(xv)
such other information agreed between such Creditor Party and the Borrower,
to enable such numbering service provider to provide its usual syndicated loan numbering identification services.
(b)
The Parties acknowledge and agree that each identification number assigned to this Agreement, the Loan and/or the Borrowers 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.

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(c)
Each Borrower represents that none of the information set out in sub-paragraphs (i) to (xv) of paragraph (a) above is, nor will at any time be, unpublished price-sensitive information.
30.4
Use of logo and/or trademark
The Agent and/or the Arrangers have the right, at their expense, to publish information regarding their participation in this Agreement and have the right to use the Borrowers' respective logos and trademarks with the prior written consent of the relevant Borrower (not to be unreasonably withheld) in connection with such publication.
30.5
Entire agreement
This Clause 30 ( Confidential Information ) constitutes the entire agreement between the Parties in relation to the obligations of the Creditor Parties under the Finance Documents regarding Confidential Information and supersedes any previous agreement, whether express or implied, regarding Confidential Information.
30.6
Inside information
Each of the Creditor Parties acknowledges that some or all of the Confidential Information is or may be price-sensitive information and that the use of such information may be regulated or prohibited by applicable legislation including securities law relating to insider dealing and market abuse and each of the Creditor Parties undertakes not to use any Confidential Information for any unlawful purpose.
30.7
Notification of disclosure
Each of the Creditor Parties agrees (to the extent permitted by law and regulation) to inform the Borrowers:
(a)
of the circumstances of any disclosure of Confidential Information made pursuant to sub-paragraph (v) of paragraph (b) of Clause 30.2 ( 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 30 ( Confidential Information ).
30.8
Continuing obligations
The obligations in this Clause 30 ( Confidential Information ) are continuing and, in particular, shall survive and remain binding on each Creditor Party for a period of 12 months from the earlier of:
(a)
the date on which all amounts payable by the Borrowers 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 Creditor Party otherwise ceases to be a Creditor Party.
31
CONFIDENTIALITY OF FUNDING RATES AND REFERENCE BANK QUOTATIONS
31.1
Confidentiality and disclosure

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(a)
The Agent and the Borrowers agree to keep each Funding Rate (and, in the case of the 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 Agent may disclose:
(i)
any Funding Rate (but not, for the avoidance of doubt, any Reference Bank Quotation) to the Borrower pursuant to Clause 7.4 (N otification of Interest Periods and rates of normal 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 Agent and the relevant Lender or Reference Bank, as the case may be.
(c)
The Agent may disclose any Funding Rate or any Reference Bank Quotation, and the Borrowers 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 or Reference Bank Quotation is to be given pursuant to this 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 Reference Bank Quotation 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 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 Agent or the Borrowers, 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 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 Agent or the Borrowers, 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.
(v)
The Agent's obligations in this Clause 31 ( Confidentiality of Funding Rates and Reference Bank Quotations ) relating to Reference Bank Quotations are without prejudice to its obligations to make notifications under Clause 5.4 ( Notification of Interest Periods )

113     



provided that (other than pursuant to sub-paragraph (i) of paragraph (b) above) the Agent shall not include the details of any individual Reference Bank Quotation as part of any such notification.
31.2
Related obligations
(a)
The Agent and the Borrowers acknowledge that each Funding Rate (and, in the case of the 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 Agent and the Borrowers undertake not to use any Funding Rate or, in the case of the Agent, any Reference Bank Quotation for any unlawful purpose.
(b)
The Agent and the Borrowers 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 31.1 ( 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 31 ( Confidentiality of Funding Rates and Reference Bank Quotations ).
32
VARIATIONS AND WAIVERS
32.1
Variations, waivers etc. by Majority Lenders
(a)
Subject to Clauses 32.2 ( Variations, waivers etc. requiring agreement of all Lenders ), a document shall be effective to vary, waive, suspend or limit any provision of a Finance Document, or any Creditor Party's rights or remedies under such a provision or the general law, only if the document is signed, or specifically agreed to by fax, by the Borrowers, by the Agent on behalf of the Majority Lenders, by the Agent and the Security Trustee in their own rights, and, if the document relates to a Finance Document to which a Security Party is party, by that Security Party.
(b)
No amendment or waiver may be made before the date falling ten Business Days after the terms of that amendment or waiver have been notified by the Agent to the Lenders, unless each Lender is a "FATCA Protected Lender". The Agent shall notify the Lenders reasonably promptly of any amendments or waivers proposed by the Borrowers.
32.2
Variations, waivers etc. requiring agreement of all Lenders
However, as regards the following, paragraph (a) of Clause 32.1 ( Variations, waivers etc. by Majority Lenders ) applies as if the words "by the Agent on behalf of the Majority Lenders" were replaced by the words "by or on behalf of every Lender":
(a)
a change in the Margin or in the definition of LIBOR;
(b)
a change to the date for, the amount of, any payment of principal, interest, fees, or other sum payable under this Agreement;
(c)
a change to any Lender's Commitment;
(d)
an extension of Availability Period or Maturity Date;

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(e)
a change to the definition of " Finance Documents ", " Majority Lenders ", " Sanctions ", " Sanctions Authority ", " Sanctions Laws ", " Sanctions List " or " Sanctions Relevant Person ";
(f)
a change to the preamble or to Clause 2 ( Facility ), 3 ( Position of the Lenders and Swap Banks ), 4 ( Drawdown ), 5.1 ( Payment of normal interest ), 10.20 ( Sanctions ), 11.22 ( Compliance with Sanctions Laws ), 12.6 ( Notification of Sanctions ), 16 (Application of Receipts), 17 ( Application of Earnings ) or 35 ( Supplemental );
(g)
a change to this Clause 32 ( Variations of Waivers );
(h)
any release of, or material variation to, a Security Interest, guarantee, indemnity or subordination arrangement set out in a Finance Document; and
(i)
any other change or matter as regards which this Agreement or another Finance Document expressly provides that each Lender's consent is required.
32.3
Exclusion of other or implied variations
Except for a document which satisfies the requirements of Clauses 32.1 ( Variations, waivers etc. by Majority Lenders ), 32.2 ( Variations, waivers etc. requiring agreement of all Lenders ), no document, and no act, course of conduct, failure or neglect to act, delay or acquiescence on the part of the Creditor Parties or any of them (or any person acting on behalf of any of them) shall result in the Creditor Parties or any of them (or any person acting on behalf of any of them) being taken to have varied, waived, suspended or limited, or being precluded (permanently or temporarily) from enforcing, relying on or exercising:
(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,
and there shall not be implied into any Finance Document any term or condition requiring any such provision to be enforced, or such right or remedy to be exercised, within a certain or reasonable time.
33
NOTICES
33.1
General
Unless otherwise specifically provided, any notice under or in connection with any Finance Document shall be given by letter or fax; and references in the Finance Documents to written notices, notices in writing and notices signed by particular persons shall be construed accordingly.
33.2
Addresses for communications
A notice by letter or fax shall be sent:
(a)
to the Borrowers:    c/o Euronav NV
De Gerlachekaai 20
2000 Antwerp 1

115     



Belgium
Fax No:    + 32 32 47 44 09
Email:    Financial@euronav.com

Attn:    CFO
-and-
c/o International Seaways Ship Management LLC
600 Third Avenue, 39th Floor
New York, New York 10016
Fax No: +1 212 251 1180
Email: LegalDepartment@intlseas.com
Attn:    Legal Department
(b)
to a Lender:    At the address below its name in Part A of Schedule 1 or (as the case may require) in the relevant Transfer Certificate.
(c)
to a Swap Bank:    At the address below its name in Part B of Schedule 1
(d)
to the Agent:    Bijlmerplein 888
1102 MG
Amsterdam
The Netherlands
PO Box 1800
1000 BV Amsterdam
The Netherlands

Fax No:    +31 20 5658226
Email:    reina.kroon@ing.com

Attn:     Reina Kroon
(e)
to the Security Trustee:    Bijlmerplein 888
1102 MG
Amsterdam
The Netherlands

PO Box 1800
1000 BV Amsterdam
The Netherlands

Fax No:    +31 20 5658226
Email:    reina.kroon@ing.com

Attn:     Reina Kroon

116     



or to such other address as the relevant party may notify the Agent, the Swap Banks or, if the relevant party is the Agent or the Security Trustee, the Borrowers, the Lenders and the Security Parties.
33.3
Effective date of notices
Subject to Clauses 33.4 ( Service outside business hours ) and 33.5 ( Illegible 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, 2 hours after its transmission is completed.
33.4
Service outside business hours
However, if under Clause 33.3 ( Effective date of notices ) a notice would be deemed to be served:
(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,
the notice shall (subject to Clause 33.5 ( Illegible notices )) be deemed to be served, and shall take effect, at 9 a.m. on the next day which is such a business day.
33.5
Illegible notices
Clauses 33.3 ( Effective date of notices ) and 33.4 ( Service outside business hours ) do not apply if the recipient of a notice notifies the sender within 1 hour after the time at which the notice would otherwise be deemed to be served that the notice has been received in a form which is illegible in a material respect.
33.6
Valid notices
A notice under or in connection with a Finance Document shall not be invalid by reason that its contents or the manner of serving it do not comply with the requirements of this Agreement or, where appropriate, any other Finance Document under which it is served if:
(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.
33.7
Electronic communication
Any communication to be made between the Agent and a Lender under or in connection with the Finance Documents may be made by electronic mail or other electronic means, if the Agent and the relevant Lender:
(a)
agree that, unless and until notified to the contrary, this is to be an accepted form of communication;
(b)
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

117     



(c)
notify each other of any change to their respective addresses or any other such information supplied to them.
Any electronic communication made between the Agent and a Lender will be effective only when actually received in readable form and, in the case of any electronic communication made by a Lender to the Agent, only if it is addressed in such a manner as the Agent shall specify for this purpose.
33.8
English language
Any notice under or in connection with a Finance Document shall be in English.
33.9
Meaning of "notice"
In this Clause 33 ( Notices ), " notice " includes any demand, consent, authorisation, approval, instruction, waiver or other communication.
34
JOINT AND SEVERAL LIABILITY
34.1
General
All liabilities and obligations of the Borrowers under this Agreement shall, whether expressed to be so or not, be several and, if and to the extent consistent with Clause 34.2 ( No impairment of Borrower's obligations ), joint.
34.2
No impairment of Borrower's obligations
The liabilities and obligations of a Borrower shall not be impaired by:
(a)
this Agreement being or later becoming void, unenforceable or illegal as regards any other Borrower;
(b)
any Lender or the Security Trustee entering into any rescheduling, refinancing or other arrangement of any kind with any other Borrower;
(c)
any Lender or the Security Trustee releasing any other Borrower or any Security Interest created by a Finance Document; or
(d)
any combination of the foregoing.
34.3
Principal debtors
Each Borrower declares that it is and will, throughout the Security Period, remain a principal debtor for all amounts owing under this Agreement and the Finance Documents and no Borrower shall in any circumstances be construed to be a surety for the obligations of any other Borrower under this Agreement.
34.4
Subordination
Subject to Clause 34.5 ( Borrower's required action ), during the Security Period, no Borrower shall:
(a)
claim any amount which may be due to it from any 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

118     



(b)
take or enforce any form of security from any 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 any other Borrower; or
(c)
set off such an amount against any sum due from it to any other Borrower; or
(d)
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving any other Borrower or other Security Party; or
(e)
exercise or assert any combination of the foregoing.
34.5
Borrower's required action
If during the Security Period, the Agent, by notice to a Borrower, requires it to take any action referred to in paragraphs (a) to (d) of Clause 34.4 ( Subordination ), in relation to any other Borrower, that Borrower shall take that action as soon as practicable after receiving the Agent's notice.
35
SUPPLEMENTAL
35.1
Rights cumulative, non-exclusive
The rights and remedies which the Finance Documents give to each Creditor Party are:
(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.
35.2
Severability of provisions
If any provision of a Finance Document is or subsequently becomes void, unenforceable or illegal, that shall not affect the validity, enforceability or legality of the other provisions of that Finance Document or of the provisions of any other Finance Document.
35.3
Counterparts
A Finance Document may be executed in any number of counterparts.
35.4
Third party rights
(a)
Unless expressly provided to the contrary in this Agreement, a person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 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 person described in Clause 5.5 ( Role of Reference Banks ), Clause 5.6 ( Third Party Reference Banks ), paragraph (b) of Clause 22.11 ( Exclusion of liability ) or paragraph (b) of Clause 23.11 ( Exclusion of liability ) may, subject to this Clause 35.4 ( Third party rights ) and the Third Parties Act, rely on any Clause of this Agreement which expressly confers rights on it.

119     



35.5
Bail-In
Notwithstanding any other term of any Finance Document or any other agreement, arrangement or understanding between the parties to a Finance Document, each Party acknowledges and accepts that any liability of any party to a Finance Document under or in connection with the Finance Documents may be subject to Bail-In Action by the relevant Resolution Authority and acknowledges and accepts to be bound by the effect of:
(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.
36
LAW AND JURISDICTION
36.1
English law
This Agreement and any non-contractual obligations arising out of or in connection with it shall be governed by, and construed in accordance with, English law.
36.2
Exclusive English jurisdiction
Subject to Clause 36.3 ( Choice of forum for the exclusive benefit of the Creditor Parties ), the courts of England shall have exclusive jurisdiction to settle any Disputes.
36.3
Choice of forum for the exclusive benefit of the Creditor Parties
Clause 36.2 ( Exclusive English jurisdiction ) is for the exclusive benefit of the Creditor Parties, each of which reserves the right:
(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 matter; 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.
Neither Borrower shall commence any proceedings in any country other than England in relation to a Dispute.
36.4
Process agent
Each Borrower irrevocably appoints Euronav (UK) Agencies Ltd. at its registered office for the time being, presently at 99 Kings Road, London SW3 4PA, England, to act as its agent to receive and accept on its behalf any process or other document relating to any proceedings in the English courts which are connected with this Agreement.
36.5
Creditor Party rights unaffected

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Nothing in this Clause 36 ( Law and Jurisdiction ) shall exclude or limit any right which any Creditor Party may have (whether under the law of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
36.6
Meaning of "proceedings"
In this Clause 36 ( Law and Jurisdiction ), " proceedings " means proceedings of any kind, including an application for a provisional or protective measure and a "Dispute" means any dispute arising out of or in connection with this Agreement (including a dispute relating to the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with this Agreement. .
This Agreement has been entered into on the date stated at the beginning of this Agreement.


121     




SCHEDULE 1     
Part A

LENDERS AND COMMITMENTS
Lender
Lending Office
Commitment (US Dollars)
 
 
Tranche A
Tranche B
Revolving Facility A
Revolving Facility B
ABN AMRO Bank N.V.
Coolsingel 93
3012 AE Rotterdam
The Netherlands

Contact:
Attn: Kees Tiemstra / Rick van Kooten
Email: kees.tiemstra@nl.abnamro.com / rick.van.kooten@nl.abnamro.com  

Administrative matters:
Attn: Pieter van Wijk


$27,000,000
$28,000,000
$27,000,000
$28,000,000
ING Belgium SA/NV
Avenue Marnixlaan 24
B-1000 Brussels
Belgium

Contact:
Attn: Alexandre Cobbaert / Tristan Lapoutre
Tel: +32 2 547 37 65 / +32 2 547 38 98
Email: Alexandre.Cobbaert@ing.be  / Tristan.Lapoutre@ing.be

Operational / servicing matters:

Attn: Arnaud Vandevelde
Tel: +32 2 547 63 02
Email: lendingoperationsoffice@ing.be

Trade closing / funding and settlement matters:

Attn: Vasiliki Gkeka
Tel: +32.2.547.65.09
$27,000,000
$28,000,000
$27,000,000
$28,000,000

122     




PART B     

SWAP BANKS
Swap Bank
Office
ABN AMRO Bank N.V.
Gustav Mahlerlaan 10
 
1082 PP Amsterdam
 
The Netherlands
 
 
 
Contact:
 
 
 
Attn: Wouter Kuipers / Dave Rommy
 
Email: wouter.kuipers@nl.abnamro.com / dave.rommy@nl.abnamro.com
ING Belgium SA/NV
Avenue Marnixlaan 24
 
B-1000 Brussels
 
Belgium
 
 
 
Attn: Alexandre Cobbaert / Tristan Lapoutre
 
Tel: +32 2 547 37 65 / +32 2 547 38 98
 
Email: Alexandre.Cobbaert@ing.be / Tristan.Lapoutre@ing.be


123     




SCHEDULE 2     

TERM FACILITY REPAYMENT INSTALMENTS
 
Tranche A
Tranche 2
Date
Instalment amount (dollars)
Instalment amount (dollars)
30 June 2018
2,748,254
2,850,041
30 September 2018
2,776,286
2,879,112
31 December 2018
2,804,604
2,908,479
31 March 2019
2,833,211
2,938,145
30 June 2019
2,862,110
2,968,114
30 September 2019
2,891,304
2,998,389
31 December 2019
2,920,795
3,028,972
31 March 2020
2,950,587
3,059,868
30 June 2020
2,980,683
3,091,079
30 September 2020
3,011,086
3,122,608
31 December 2020
3,041,799
3,154,458
31 March 2021
3,072,825
3,186,634
30 June 2021
3,104,168
3,219,137
30 September 2021
3,135,831
3,251,973
31 December 2021
3,167,816
3,285,143
31 March 2022
3,200,128
3,318,651
30 June 2022
3,232,769
3,352,501
21 July 2022
3,265,743
-
22 September 2022
-
3,386,697


124     



SCHEDULE 3     
REDUCTION AMOUNTS
 
Revolving Facility A
Revolving Facility B
Date
Reduction amount (dollars)
Reduction amount (dollars)
30 June 2018
2,748,254
2,850,041
30 September 2018
2,776,286
2,879,112
31 December 2018
2,804,604
2,908,479
31 March 2019
2,833,211
2,938,145
30 June 2019
2,862,110
2,968,114
30 September 2019
2,891,304
2,998,389
31 December 2019
2,920,795
3,028,972
31 March 2020
2,950,587
3,059,868
30 June 2020
2,980,683
3,091,079
30 September 2020
3,011,086
3,122,608
31 December 2020
3,041,799
3,154,458
31 March 2021
3,072,825
3,186,634
30 June 2021
3,104,168
3,219,137
30 September 2021
3,135,831
3,251,973
31 December 2021
3,167,816
3,285,143
31 March 2022
3,200,128
3,318,651
30 June 2022
3,232,769
3,352,501
21 July 2022
3,265,743
-
22 September 2022
-
3,386,697


125     



SCHEDULE 4     
DRAWDOWN NOTICE
To:     [ING Bank N.V.
Bijlmerplein 888
1102 MG
Amsterdam
The Netherlands]
Attention: [Loans Administration]
[date]
DRAWDOWN NOTICE
1
We refer to the loan agreement (the " Loan Agreement ") dated [●] 2018 and made between ourselves, as Borrowers, the Lenders, the Swap Banks and the Arrangers referred to therein, and yourselves as Agent and as Security Trustee in connection with a facility of up to US$220,000,000. Terms defined in the Loan Agreement have their defined meanings when used in this Drawdown Notice.
2
We request to borrow as follows:
(a)
Amount: US$[●] representing an advance in relation to [Tranche [A] [B]] [Revolving Facility [A] [B];
(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)
the representations and warranties in Clause 10 ( Representations and Warranties ) of the Loan Agreement would remain true and not misleading if repeated on the date of this notice with reference to the circumstances now existing; and
(b)
no Event of Default or Potential Event of Default has occurred or will result from the borrowing of the Loan.
4
This notice cannot be revoked without the prior consent of the Majority Lenders.





___________________________________
for and on behalf of
TI AFRICA LIMITED
TI ASIA LIMITED

126     




SCHEDULE 5     

CONDITION PRECEDENT DOCUMENTS
PART A     
The following are the documents referred to in Clause 9.1(a) required before service of the first Drawdown Notice.
1
A duly executed original of each Finance Document (and of each document required to be delivered by each Finance Document) other than those referred to in Part B.
2
Copies of the certificate of incorporation and constitutional documents of each Borrower and each Security Party.
3
Copies of resolutions of directors (and, if required, for the provision of the legal opinions referred to in paragraph 12 the shareholders) of each Borrower and each Security Party (except Euronav) authorising the execution of each of the Finance Documents to which that Borrower or that Security Party is a party and, in the case of a Borrower, authorising named officers to give the Drawdown Notices and other notices under this Agreement.
4
The original of any power of attorney under which any Finance Document is executed on behalf of a Borrower or a Security Party.
5
Copies of all consents which any Borrower or any Security Party requires to enter into, or make any payment under, any Finance Document or Service Contract.
6
A valuation of each FSO, addressed to the Agent and the Lenders, stated to be for the purposes of this Agreement and dated not earlier than 30 days before the first Drawdown Date, from an Approved Valuer.
7
Copies of each of the Service Contracts and of all documents signed or issued by the parties thereto under or in connection with either of them.
8
Such documentary evidence as the Agent and its legal advisers may require in relation to the due authorisation and execution of the Service Contracts by the parties thereto and of all documents to be executed pursuant thereto.
9
If obtainable by the Borrowers using best commercial efforts, copies of the most recent audited financial statements of NOC which demonstrate that it is economically viable and it will be able to meet its obligations under the Service Contracts.
10
Documentary evidence that the agent for service of process named in Clause 30 ( Law and Jurisdiction ) has accepted its appointment.
11
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of the Marshall Islands, Hong Kong, Belgium and such other relevant jurisdictions as the Agent may require.
12
The Agent has provided the repayment schedule referred to in Clause 8.1(a).

127     



13
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.
PART B     
The following are the documents referred to in Clause 9.1(b) required before the Advance of the Loan
1
A duly executed original of each Master Agreement, each Master Agreement Assignment, each Mortgage, each General Assignment, each Service Contract Assignment, each Quiet Enjoyment Letter, each Subordination Agreement and the Co-ordination Deed (and of each document to be delivered by each of them).
2
Documentary evidence that:
(a)
the FSO maintains the classification referred to in Clause 14.3 ( Repair and classification ) free of all overdue recommendations and conditions of such classification society;
(b)
each FSO is definitively and permanently registered in the name of TI Asia under Marshall Islands for FSO 1 (in the case of FSO 1) or TI Africa under Marshall Islands flag (in the case of FSO 2);
(c)
the FSOs are in the absolute and unencumbered ownership of TI Africa or TI Asia, as the case may be, save as contemplated by the Finance Documents;
(d)
each FSO maintains the classification referred to in Clause 14.3 ( Repair and classification ) free of all overdue recommendations and conditions of such classification society;
(e)
all applicable requirements of any regulatory authority, and all consents, authorisations, licences, approvals and permits required, in connection with the FSOs and the Project have been obtained and complied with and the relevant Borrower is not in breach of any of its obligations under any agreements which it has entered into in relation to the Project in respect of either FSO (which can be confirmed in a certificate supplied by the Borrowers);
(f)
each Mortgage (executed by the relevant Borrower) has been duly registered against the relevant FSO as a valid first preferred ship mortgage in accordance with the laws of the Marshall Islands; and
(g)
the FSO is insured in accordance with the provisions of this Agreement and all requirements therein in respect of insurances have been complied with.
3
The originals of any mandates or other documents required in connection with the opening or operation of the Earnings Accounts.
4
Documents establishing that the FSO will be managed by the Approved Manager on terms acceptable to the Lenders, together with:
(a)
a letter of undertaking executed by the Approved Manager in favour of the Agent in the terms required by the Agent agreeing certain matters in relation to the management of the FSO and subordinating the rights of the Approved Manager against the relevant Borrower to the rights of the Creditor Parties under the Finance Documents; and
(b)
copies of the Approved Manager's Document of Compliance and of the FSOs Safety Management Certificates (together with any other details of the applicable safety management system which the Agent requires).

128     



5
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the law of the Marshall Islands, Hong Kong and Belgium (as the case may be) and such other relevant jurisdictions as the Agent may require.
6
A favourable opinion from an independent insurance consultant acceptable to the Agent confirming the matters referred to in paragraph 2(h) of this Part B of Schedule 5 ( Conditions Precedent Documents ) on such matters relating to the insurances for FSOs as the Agent may require.
7
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.
Each of the documents specified in paragraphs 2, 3, 5 and 8 of Part A and every other copy document delivered under this Schedule shall be certified as a true and up to date copy by a director or the secretary (or equivalent officer) of a Borrower.


129     




SCHEDULE 6     

TRANSFER CERTIFICATE
The Transferor and the Transferee accept exclusive responsibility for ensuring that this Certificate and the transaction to which it relates comply with all legal and regulatory requirements applicable to them respectively.
To:    [Name of Agent] for itself and for and on behalf of each Borrower, each Security Party, the Security Trustee, the Arrangers and each Lender, as defined in the Loan Agreement referred to below.
1
This Certificate relates to a loan agreement (the " Loan Agreement ") dated [●] 2018 and made between (i) TI Africa Limited and TI Asia Limited as Borrowers, (ii) the banks and financial institutions named therein as Lenders, (iii) the banks and financial institutions named therein as Swap Banks, (iv) the banks and financial institutions named there as Mandated Lead Arrangers, (v) ING Bank N.V. as Agent and (vi) ING Bank N.V. as Security Trustee for a loan facility of, originally, up to US$220,000,000.
2
In this Certificate, terms defined in the Loan Agreement shall, unless the contrary intention appears, have the same meanings and:
" Relevant Parties " means the Agent, each Borrower, each Security Party, the Security Trustee, the Arrangers, each Lender and each Swap Bank;
" Transferor " means [full name] of [lending office]; and
" Transferee " means [full name] of [lending office].
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.
4
The Transferor assigns to the Transferee absolutely all rights and interests (present, future or contingent) which the Transferor has as Lender under or by virtue of the Loan Agreement and every other Finance Document in relation to [●] per cent. of its Contribution, which percentage represents $[●].
5
By virtue of this Certificate and Clause 29 ( Transfers and Changes in Lending Offices ) of the Loan Agreement, the Transferor is discharged [entirely from its Commitment which amounts to $[●]] [from [●] per cent. of its Commitment, which percentage represents $[●]] and the Transferee acquires a Commitment of $[●].]
6
The Transferee undertakes with the Transferor and each of the Relevant Parties that the Transferee will observe and perform all the obligations under the Finance Documents which Clause 29 ( Transfer and changes in Lending Offices ) of the Loan Agreement provides will become binding on it upon this Certificate taking effect.
7
The Agent, at the request of the Transferee (which request is hereby made) accepts, for the Agent itself and for and on behalf of every other Relevant Party, this Certificate as a Transfer Certificate taking effect in accordance with Clause 29 ( Transfers and Changes in Lending Offices ) of the Loan Agreement.

130     



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
(c)
undertakes with the Transferee that the Transferor will, at its own expense, execute any documents which the Transferee reasonably requests for perfecting in any relevant jurisdiction the Transferee's title under this Certificate or for a similar purpose.
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 Security Trustee, any Lender or any Swap Bank in the event that:
(i)
any of the Finance Documents prove to be invalid or ineffective;
(ii)
any Borrower or any Security Party fails to observe or perform its obligations, or to discharge its liabilities, under any of the Finance Documents;
(iii)
it proves impossible to realise any asset covered by a Security Interest created by a Finance Document, or the proceeds of such assets are insufficient to discharge the liabilities of the Borrowers or Security Party under the Finance Documents;
(c)
agrees that it will have no rights of recourse on any ground against the Agent, the Security Trustee, any Lender or any Swap Bank in the event that this Certificate proves to be invalid or ineffective;
(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.
10
The Transferor and the Transferee each undertake with the Agent and the Security Trustee severally, on demand, fully to indemnify the Agent and/or the Security Trustee in respect of any claim, proceeding, liability or expense (including all legal expenses) which they or either of them may incur in connection with this Certificate or any matter arising out of it, except such as are shown to have been mainly and directly caused by the gross and culpable negligence or dishonesty of the Agent's or the Security Trustee's own officers or employees.

131     



11
The Transferee shall repay to the Transferor on demand so much of any sum paid by the Transferor under paragraph 10 as exceeds one-half of the amount demanded by the Agent or the Security Trustee in respect of a claim, proceeding, liability or expense which was not reasonably foreseeable at the date of this Certificate; but nothing in this paragraph shall affect the liability of each of the Transferor and the Transferee to the Agent or the Security Trustee for the full amount demanded by it.
[Name of Transferor]    [Name of Transferee]
By:    By:
Date:    Date:


Agent
Signed for itself and for and on behalf of itself
as Agent and for every other Relevant Party
[Name of Agent]
By:
Date:


132     




Administrative Details of Transferee
Name of Transferee:
Lending Office:
Contact Person
(Loan Administration Department):
Telephone:
Fax:
Contact Person
(Credit Administration Department):
Telephone:
Fax:
Account for payments:

Note :
This Transfer Certificate alone may not be sufficient to transfer a proportionate share of the Transferor's interest in the security constituted by the Finance Documents in the Transferor's or Transferee's jurisdiction. It is the responsibility of each Lender to ascertain whether any other documents are required for this purpose.


133     





134     



SCHEDULE 7     

DESIGNATION NOTICE
To:    ING Bank N.V.
Bijlmerplein 888
1102 MG
Amsterdam

The Netherlands
Attention: [Loans Administration]
[ date ]
Dear Sirs
Loan Agreement dated [●] 2018 made between (i) ourselves as Borrowers, (ii) the Lenders, (iii) the Swap Banks, (iv) the Mandated Lead Arrangers as referred to therein and (v) yourselves as Agent and Security Trustee for a loan facility of, originally, up to US$220,000,000 (the "Loan Agreement")
We refer to:
1
the Loan Agreement;
2
the Master Agreement dated as of [●] made between ourselves and [●]; and
3
a Confirmation delivered pursuant to the said Master Agreement dated [●] and addressed by [●] to us.
In accordance with the terms of the Loan Agreement, we hereby give you notice of the said Confirmation and hereby confirm that the Transaction evidenced by it will be designated as a "Designated Transaction" for the purposes of the Loan Agreement and the Finance Documents.
Yours faithfully





.................................................
for and on behalf of
TI AFRICA LIMITED
TI ASIA LIMITED]
[SWAP BANK]


135     





136     



SCHEDULE 8     

TIMETABLES
LIBOR is fixed

Quotation Date as of 11:00 am London time
Reference Bank Rate calculated by reference to available quotations in accordance with Clause 5.8 (Calculation of Reference Bank Rate)
Noon on the Quotation Date



137     





138     



SCHEDULE 9     

FORM OF COMPLIANCE CERTIFICATE
To:
ING Bank NV
Bijlmerplein 888
1102 MG
Amsterdam

The Netherlands
From:     [TI Africa Limited][TI Asia Limited]
[Date]
OFFICER'S CERTIFICATE
This Certificate is rendered pursuant to clause 11.7 ( Compliance Certificate ) of the loan agreement dated [●] 2018 (the " Loan Agreement ") and entered into between (i) TI Africa Limited and TI Asia Limited, as Borrowers (ii) the banks and financial institutions listed in Schedule 1 therein as Lenders, (2) the banks and financial institutions listed in Schedule 1 therein as Swap Banks, (iii) the Mandated Lead Arrangers as referred to therein and (v) ING Bank NV as Agent and Security Trustee, relating to a loan facility of up to US$220,000,000. Words and expressions defined in the Loan Agreement shall have the same meanings when used herein.
We, being directors of the [TI Africa][TI Asia], hereby certify that:
1
Attached to this Certificate are audited accounts of the [TI Africa][TI Asia] for the financial year ending on [●] (the " Accounts ").
2
Set out below are the respective amounts, in US Dollars of (i) EBITDA and (ii) the aggregate of any net interest cost, guarantee commission and instalments payable by [TI AFRICA][TI ASIA] for the financial year ending on [●]:
 
US Dollars
EBITDA
[●]
Net interest cost, guarantee commission and instalments payable by [TI AFRICA][TI ASIA]
[●]
3
Accordingly, as at the date of this Certificate the financial covenants set out in Clause 12.5 ( Financial covenants ) of the Loan Agreement [are] [are not] complied with, in that as at [●] the Debt Service Cover Ratio for the financial year ending on [●] equals [●].
[or, as the case may be, specify in what respect the financial covenants are not complied with.]
4
As at [●] no Event of Default has occurred and is continuing.
[or, specify/identify any Event of Default]
The Market Value of the FSOs which are subject to a Mortgage is as follows as at [date]:

139     



Name of FSO
Name of shipbroker providing valuation
Market Value
FSO AFRICA
[●]
[●]
FSO ASIA
[●]
[●]

…………………………..……………………
Director  
[TI AFRICA LIMITED][TI ASIA LIMITED]
…………………………..……………………
Director  
[TI AFRICA LIMITED][TI ASIA LIMITED]

Note: Supporting Schedules to be attached.

140     



SCHEDULE 10     

141     



SCHEDULE 11     

FORM OF BUDGET

TI ASIA LTD - TI AFRICA LTD BUDGET
 
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
FULL YEAR
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL REVENUE
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Onhire Days
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL DAYS
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TCE
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE TCE
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Product Quality Bonus
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL OTH INC
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Opex
 
 
 
 
 
 
 
 
 
 
 
 
 
Opex/day
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mgt Fee
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Insurance
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Drydock/Special
 
 
 
 
 
 
 
 
 
 
 
 
 

142     



 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intrest Exp
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciations borrowing costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Overheads
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL RESULT
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00




143     



EXECUTION PAGES
BORROWERS

SIGNED by    ) /s/ Egied Verbeeck
) Egied Verbeeck
for and on behalf of    )
TI AFRICA LIMITED     )
in the presence of:    ) /s/ Hugo De Stoop
Hugo De Stoop



SIGNED by    ) /s/ Egied Verbeeck
) Egied Verbeeck
for and on behalf of    )
TI ASIA LIMITED     )
in the presence of:    ) /s/ Hugo De Stoop
Hugo De Stoop



LENDERS

SIGNED by    )
)
for and on behalf of    )
ABN AMRO BANK N.V.     )
in the presence of:    )
    


SIGNED by    )
)
for and on behalf of    )
ING BELGIUM SA/NV     )
in the presence of:    )




SWAP BANKS

SIGNED by    )
)
for and on behalf of    )
ABN AMRO BANK N.V.     )
in the presence of:    )







144     




EXECUTION PAGES
BORROWERS

SIGNED by    ) /s/ Lois K. Zobrocky
) Lois K. Zobrocky, Director
for and on behalf of    )
TI AFRICA LIMITED     )
in the presence of:    ) /s/ James I. Edelson
James I. Edelson



SIGNED by    ) /s/ Lois K. Zobrocky
) Lois K. Zobrocky, Director
for and on behalf of    )
TI ASIA LIMITED     )
in the presence of:    ) /s/ James I. Edelson
James I. Edelson



LENDERS

SIGNED by    )
)
for and on behalf of    )
ABN AMRO BANK N.V.     )
in the presence of:    )
    


SIGNED by    )
)
for and on behalf of    )
ING BELGIUM SA/NV     )
in the presence of:    )




SWAP BANKS

SIGNED by    )
)
for and on behalf of    )
ABN AMRO BANK N.V.     )
in the presence of:    )






145     




EXECUTION PAGES
BORROWERS

SIGNED by    )
)
for and on behalf of    )
TI AFRICA LIMITED     )
in the presence of:    )



SIGNED by    )
)
for and on behalf of    )
TI ASIA LIMITED     )
in the presence of:    )



LENDERS

SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ABN AMRO BANK N.V.     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB
    


SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ING BELGIUM SA/NV     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB








146     



SWAP BANKS

SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ABN AMRO BANK N.V.     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB



SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ING BELGIUM SA/NV     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB


MANDATED LEAD ARRANGERS

SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ABN AMRO BANK N.V.     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB




SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ING BELGIUM SA/NV     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB

147     





AGENT

SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ING BANK N.V.     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB





SECURITY TRUSTEE

SIGNED by    ) /s/ Philippos Arcoumanis
) Philippos Arcoumanis
for and on behalf of    ) Attorney-in-Fact
ING BANK N.V.     )
in the presence of:    ) /s/ Sebastian Lello
Sebastian Lello
Trainee Solicitor
Watson Farley & Williams LLP
15 Appold Street
London EC2A 2HB

148     

Exhibit 10.22

 

Dated 29 March 2018

 

 

 

 

 

 

 

INTERNATIONAL SEAWAYS, INC.

as Guarantor

 

and

 

ING BANK N.V.

as Security Trustee

 

 

 

 

 

Guarantee

 

relating to
a Loan Agreement dated 29 March 2018
for a facility of up to US$220,000,000

 

 

 

 

 

 

 

Index

 

Clause Page

 

1 Interpretation 1
2 Guarantee 2
3 Liability as Principal and Independent Debtor 3
4 Expenses 3
5 Adjustment of Transactions 4
6 Payments 4
7 Interest 5
8 Subordination 5
9 Enforcement 6
10 Representations and Warranties 6
11 Undertakings 8
12 Judgments and Currency Indemnity 12
13 Set-Off 12
14 Supplemental 13
15 Assignment 14
16 Notices 14
17 Invalidity of Loan Agreement or Master Agreements 15
18 Governing Law and Jurisdiction 16
     
Execution  
     
Execution Page 20

 

 

 

 

 

THIS GUARANTEE is made on 29 March 2018

 

PARTIES

 

(1) INTERNATIONAL SEAWAYS, 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 " Guarantor ")

 

(2) ING BANK N.V. , a company incorporated in The Netherlands, acting through its office at Bijlmerplein 888, 1102 MG Amsterdam, The Netherlands (the " Security Trustee ", which expression includes its successors and assigns)

 

BACKGROUND

 

(A) By a loan agreement dated 29 March 2018 and made between (i) TI Africa and TI Asia as joint and several borrowers (the “ Borrowers ”), (ii) the Mandated Lead Arrangers, (iii) the Lenders, (iv) the Swap Banks, (v) the Agent and (vi) the Security Trustee it was agreed that the Lenders would make available to the Borrowers a facility of up to US$220,000,000.

 

(B) Pursuant to master agreements (each on the 2002 ISDA form) each made or to be made between (i) a Borrower and (ii) a Swap Bank, the Borrowers and the Swap Banks may enter into Designated Transactions.

 

(C) By the Loan Agreement, it was agreed that the Security Trustee would hold the Security Property (as defined in the Loan Agreement) on trust for (inter alia) the Lenders and the Swap Banks.

 

(D) The execution and delivery to the Security Trustee of this Guarantee and the Euronav Guarantee is one of the conditions precedent to the availability of the facility under the Loan Agreement.

 

IT IS AGREED as follows:

 

operative provisions

 

1 Interpretation

 

1.1 Defined expressions

 

Words and expressions defined in the Loan Agreement have the same meanings when used in this Guarantee unless the context otherwise requires.

 

1.2 Construction of certain terms

 

In this Guarantee:

 

" bankruptcy " includes a liquidation, receivership or administration and any form of suspension of payments, arrangement with creditors or reorganisation under any corporate or insolvency law of any country.

 

" Euronav Guarantee " means the several guarantee of the liabilities of the Borrowers in respect of the Revolving Facility executed by Euronav in favour of the Security Trustee in Agreed Form.

 

" Group " means the Guarantor and each of its subsidiaries.

 

 

 

 

" Limitation Removal Notice " means a notice duly executed by the Guarantor stating that it is a Limitation Removal Notice for the purpose of this Guarantee and otherwise in form and substance satisfactory to the Agent.

 

" Loan Agreement " means the loan agreement dated 29 March 2018 referred to in Recital (A) and includes any existing or future amendments or supplements, whether made with the Guarantor's consent or otherwise.

 

" Master Agreements " means each master agreement referred to in Recital (B) (including, in each case, all Designated Transactions from time to time entered into and Confirmations from time to time exchanged under any such master agreement).

 

" Maximum Guarantee Amount " means, at any time, the amount of the Secured Liabilities outstanding at that time multiplied by the following percentage:

 

The amount outstanding under the Term Loan

The aggregate amount outstanding under the Facilities

 

" NOC " means North Oil Company, a private joint-stock company organised and existing under the laws of the State of Qatar, registered under no. 90333 and having its registered office at 7th Floor, The Gate Mall Tower 4, P.O. Box 21264, West Bay, Doha, State of Qatar.

 

TI Africa ” means TI Africa Limited, a company incorporated in Hong Kong with registration number 1212754 whose registered office is at Room 2503-05, 25 th Floor, Harcourt House, No. 39 Gloucester Road, Wanchai, Hong Kong.

 

TI Asia ” means TI Asia Limited, a company incorporated in Hong Kong with registration number 1210743 whose registered office is at Room 2503-05, 25 th Floor, Harcourt House, No. 39 Gloucester Road, Wanchai, Hong Kong.

 

1.3 Application of construction and interpretation provisions of Loan Agreement

 

Clauses 1.2, 1.5 and 1.6 of the Loan Agreement apply, with any necessary modifications, to this Guarantee.

 

2 Guarantee

 

2.1 Guarantee and indemnity

 

The Guarantor unconditionally and irrevocably:

 

(a) guarantees the due payment of all amounts payable by the Borrowers under or in connection with the Loan Agreement, every other Finance Document and the Master Agreements;

 

(b) undertakes to pay to the Security Trustee, on the Security Trustee's demand, any such amount which is not paid by the Borrowers when payable; and

 

(c) fully indemnifies the Security Trustee and each other Creditor Party on the Security Trustee's demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Security Trustee or any other Creditor Party as a result of or in connection with any obligation or liability guaranteed by the Guarantor being or becoming unenforceable, invalid, void or illegal; and the amount recoverable under this indemnity shall be equal to the amount which the Security Trustee or the other Creditor Party concerned would otherwise have been entitled to recover.

 

 

 

 

2.2 No limit on number of demands

 

The Security Trustee may serve more than one demand under Clause 2.1 ( Guarantee and indemnity ).

 

2.3 Limitation of liability

 

Unless a Limitation Removal Notice has been delivered to the Security Trustee in accordance with Clause 11.22 ( Right to remedy breach of Euronav Guarantee ), the maximum liability of the Guarantor under Clause 2.1 ( Guarantee and indemnity ) shall not exceed the Maximum Guarantee Amount.

 

2.4 Guarantee of whole amount

 

Without prejudice to the limit on the liability of the Guarantor set out in Clause 2.3 ( Limitation of liability ), this Guarantee shall be construed and take effect as a guarantee of all amounts due to the Creditor Parties or any of them under the Loan Agreement, the other Finance Documents and the Master Agreements.

 

3 Liability as Principal and Independent Debtor

 

3.1 Principal and independent debtor

 

The Guarantor shall be liable under this Guarantee as a principal and independent debtor and accordingly it shall not have, as regards this Guarantee, any of the rights or defences of a surety.

 

3.2 Waiver of rights and defences

 

Without limiting the generality of Clause 3.1 ( Principal and independent debtor ), the Guarantor shall neither be discharged by, nor have any claim against any Creditor Party in respect of:

 

(a) any amendment or supplement being made to the Finance Documents or the Master Agreements (or any of them);

 

(b) any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents or the Master Agreements (or any of them);

 

(c) any release or loss of any right or Security Interest created by the Finance Documents or the Master Agreements (or any of them);

 

(d) any failure (even though negligent) promptly or properly to exercise or enforce any such right or Security Interest, including a failure to realise for its full market value an asset covered by such a Security Interest; or

 

(e) any other Finance Document or any Master Agreement or any Security Interest now being or later becoming void, unenforceable, illegal or invalid or otherwise defective for any reason, including a neglect to register it.

 

 

 

 

4 Expenses

 

4.1 Costs of preservation of rights, enforcement etc.

 

The Guarantor shall pay to the Security Trustee on its demand all expenses incurred by the Security Trustee or any other Creditor Party in connection with any matter arising out of or relating to this Guarantee, including any advice, claim or proceedings relating to this Guarantee.

 

4.2 Fees and expenses payable under Loan Agreement

 

Clause 4.1 ( Costs of preservation of rights, enforcement etc. ) is without prejudice to the Guarantor's liabilities for the Borrowers' obligations under clause 19 of the Loan Agreement (fees and expenses) and under similar provisions of other Finance Documents and the Master Agreements.

 

5 Adjustment of Transactions

 

5.1 Reinstatement of obligation to pay

 

The Guarantor shall pay to the Security Trustee on its demand any amount which any Creditor Party is required, or agrees, to pay pursuant to any claim by, or settlement with, a trustee in bankruptcy of any Borrower or of another Security Party (or similar person) on the ground that the Loan Agreement or any Master Agreement, or a payment by any Borrower or of another Security Party, was invalid or on any similar ground.

 

6 Payments

 

6.1 Method of payments

 

Any amount due under this Guarantee shall be paid:

 

(a) in immediately available funds;

 

(b) to such account as the Security Trustee may from time to time notify to the Guarantor;

 

(c) without any form of set-off, cross-claim or condition; and

 

(d) free and clear of any tax deduction except a tax deduction which the Guarantor is required by law to make.

 

6.2 Grossing-up for taxes

 

If the Guarantor is required by law to make a tax deduction, the amount due to the Security Trustee shall be increased by the amount necessary to ensure that the Security Trustee and (if the payment is not due to the Security Trustee for its own account) the Creditor Party beneficially interested in the payment receives and retains a net amount which, after the tax deduction, is equal to the full amount that it would otherwise have received.

 

6.3 Tax Credit

 

A Creditor Party which has obtained (and has derived full use and benefit, on an affiliated group basis, of) a repayment or credit in respect of tax on account of which the Guarantor has made an increased payment under Clause 6.2 ( Grossing-up for taxes ) shall pay to the Guarantor a sum equal to the proportion of the repayment or credit which that Creditor Party allocates to the amount due from the Guarantor in respect of which the Guarantor made the increased payment Provided that :

 

 

 

 

(a) the Creditor Party shall not be obliged to allocate to this transaction any part of a tax repayment or credit which is referable to a class or number of transactions;

 

(b) nothing in this Clause 6.3 ( Tax Credit ) shall oblige a Creditor Party to arrange 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;

 

(c) nothing in this Clause 6.3 ( Tax Credit ) shall oblige a Creditor Party to make a payment which would leave it in a worse position than it would have been in if the Guarantor had not been required to make a tax deduction from a payment;

 

(d) any allocation or determination made by a Creditor Party under or in connection with this Clause 6.3 ( Tax Credit ) shall be conclusive and binding on the Guarantor and the other Creditor Parties;

 

(e) nothing in this Clause 6.3 ( Tax Credit ) shall oblige any Creditor Party to disclose any information relating to its affairs (tax or otherwise) or those of its ultimate payment company (or any subsidiary thereof) or any computations in respect of tax; and

 

(f) the Creditor Party's tax affairs for its tax year in respect of which such credit or repayment was obtained have been finally settled.

 

7 Interest

 

7.1 Accrual of interest

 

Unless interest on that same amount also accrues under the Loan Agreement or, as the case may be, a Master Agreement, any amount due under this Guarantee shall carry interest after the date on which the Security Trustee demands payment of it until it is actually paid.

 

7.2 Calculation of interest

 

Interest under this Guarantee shall be calculated and accrue in accordance with clause 7 of the Loan Agreement.

 

7.3 Guarantee extends to interest payable under Loan Agreement

 

This Guarantee covers all interest payable under the Loan Agreement and the Master Agreements, including that payable under clause 7 of the Loan Agreement and section 2(e) of each Master Agreement.

 

8 Subordination

 

8.1 Subordination of rights of Guarantor

 

All rights which the Guarantor at any time has (whether in respect of this Guarantee or any other transaction) against any Borrower, any other Security Party or their respective assets shall be fully subordinated to the rights of the Creditor Parties under the Finance Documents and the Master Agreements; and in particular, the Guarantor shall not:

 

 

 

 

(a) claim, or in a bankruptcy of any Borrower or any other Security Party prove for, any amount payable to the Guarantor by any Borrower or any other Security Party, whether in respect of this Guarantee or any other transaction;

 

(b) take or enforce any Security Interest for any such amount;

 

(c) claim to set-off any such amount against any amount payable by the Guarantor to any Borrower or any other Security Party; or

 

(d) claim any subrogation or other right in respect of any Finance Document or any Master Agreement or any sum received or recovered by any Creditor Party under a Finance Document or a Master Agreement.

 

9 Enforcement

 

9.1 No requirement to commence proceedings against Borrowers

 

Neither the Security Trustee nor any other Creditor Party will need to commence any proceedings under, or enforce any Security Interest created by, the Loan Agreement, any other Finance Document or any Master Agreement before claiming or commencing proceedings under this Guarantee.

 

9.2 Conclusive evidence of certain matters

 

As against the Guarantor:

 

(a) any judgment or order of a court in England, Hong Kong or the Republic of the Marshall Islands in connection with the Loan Agreement and/or any Master Agreement; and

 

(b) any statement or admission of any Borrower in connection with the Loan Agreement and/or any Master Agreement,

 

shall be binding and conclusive as to all matters of fact and law to which it relates.

 

9.3 Suspense account

 

The Security Trustee and any Creditor Party may, for the purpose of claiming or proving in a bankruptcy of any Borrowers or any other Security Party, place any sum received or recovered under or by virtue of this Guarantee or any Security Interest connected with it on a separate suspense or other nominal account without applying it in satisfaction of the Borrowers' (or any of their) obligations under the Loan Agreement or as the case may be, any Master Agreement.

 

10 Representations and Warranties

 

10.1 General

 

The Guarantor represents and warrants to the Security Trustee as follows.

 

10.2 Status

 

The Guarantor is duly incorporated and validly existing and in good standing under the laws of the Republic of the Marshall Islands.

 

 

 

 

10.3 Corporate power

 

The Guarantor has the corporate capacity, and has taken all corporate action and obtained all consents necessary for it:

 

(a) to execute this Guarantee; and

 

(b) to make all the payments contemplated by, and to comply with, this Guarantee.

 

10.4 Consents in force

 

All the consents referred to in Clause 10.3 ( Corporate power ) remain in force and nothing has occurred which makes any of them liable to revocation.

 

10.5 Legal validity

 

This Guarantee constitutes the Guarantor's legal, valid and binding obligations enforceable against the Guarantor in accordance with its terms subject to any relevant insolvency laws affecting creditors' rights generally.

 

10.6 No conflicts

 

The execution by the Guarantor of this Guarantee and its compliance with this Guarantee will not involve or lead to a contravention of:

 

(a) any law or regulation;

 

(b) the constitutional documents of the Guarantor; or

 

(c) any contractual or other obligation or restriction which is binding on the Guarantor or any of its assets.

 

10.7 No withholding taxes

 

All payments which the Guarantor is liable to make under this Guarantee may be made without deduction or withholding for or on account of any tax payable under any law of any Pertinent Jurisdiction.

 

10.8 No default

 

To the knowledge of the Guarantor, no Event of Default or Guarantee Facility Event of Default or Potential Event of Default has occurred.

 

10.9 Information

 

All information which has been provided by or on behalf of the Guarantor to the Security Trustee or any other Creditor Party in connection with any Finance Document satisfied the requirements of Clause 11.2 ( Information provided to be accurate ); all audited and unaudited financial statements which have been so provided satisfied the requirements of Clause 11.4 ( Form of financial statements ); and there has been no material adverse change in the financial position or state of affairs of the Guarantor from that disclosed in the latest of those financial statements.

 

 

 

 

10.10 No litigation

 

No legal or administrative action involving the Guarantor has been commenced or taken or, to the Guarantor's knowledge, is likely to be commenced or taken which, in either case, would be likely to have a material adverse effect on the Guarantor's financial position or profitability.

 

10.11 Eligible contract participant

 

The Guarantor is an "eligible contract participant" as defined in section 1a(18) of the U.S. Commodity Exchange Act, as amended from time to time.

 

11 Undertakings

 

11.1 General

 

The Guarantor undertakes with the Security Trustee to comply with the following provisions of this Clause 11 ( Undertakings ) at all times during the Security Period, except as the Agent may, with the authority of the Majority Lenders, otherwise permit (such permission not to be unreasonably withheld or delayed in the case of Clause 11.13 ( Maintenance of ownership of Africa Tanker Corporation ) or Clause 11.14 ( No merger etc. ).

 

11.2 Information provided to be accurate

 

All financial and other information which is provided by or on behalf of the Guarantor under or in connection with this Guarantee will be true and not misleading in all material respects and will not omit any material fact or consideration.

 

11.3 Provision of financial statements

 

To the extent the Security Trustee is unable to obtain copies from the Guarantor's website, the Guarantor will send to the Security Trustee:

 

(a) as soon as possible, but in no event later than 180 days after the end of each financial year of the Guarantor, the audited consolidated accounts of the Group;

 

(b) as soon as possible, but in no event later than 90 days after the end of each half-year in each financial year of the Guarantor unaudited consolidated balance sheet of the Group certified as to their correctness by the chief financial officer of the Guarantor; and

 

(c) every six months, together with the annual audited consolidated accounts and with every other balance sheet referred to in paragraphs (a) and (b), a compliance certificate signed by the chief financial officer of the Guarantor in the form attached as Schedule 1 (or in any other format which the Agent may approve) evidencing compliance with the financial undertakings in Clause 11.5 ( Financial Covenants ).

 

11.4 Form of financial statements

 

All accounts (audited and unaudited) delivered under Clause 11.3 ( Provision of financial statements ) will:

 

(a) be prepared in accordance with all applicable laws and GAAP consistently applied;

 

 

 

 

(b) give a true and fair view of the state of affairs of the Group at the date of those accounts and of profit for the period to which those accounts relate; and

 

(c) fully disclose or provide for all significant liabilities of the Group.

 

11.5 Financial Covenants

 

The Guarantor will ensure that its consolidated financial position shall at all times during the Security Period be such that:

 

(a) Liquid Assets are not less than the higher of:

 

(i) $50,000,000;

 

(ii) 5 per cent. of Total Indebtedness;

 

(b) the amount of Cash shall equal or exceed US$30,000,000; and

 

(c) the Guarantor is in compliance with the Loan to Value Test .

 

In this Clause 11.5 ( Financial Covenants ):

 

" Cash " means, at any date of determination under this Guarantee, the aggregate value of the Group's credit balances on any deposit, savings or current account and cash in hand with recognised and reputable banks or financial institutions;

 

" Cash Equivalents " has the meaning given to it in the Term Loan B Agreement.

 

" Indebtedness " has the meaning given to it in the Term Loan B Agreement.

 

" Latest Balance Sheet " means, at any date, the consolidated balance sheet of the Group most recently delivered to the Agent pursuant to Clause 11.3 ( Provision of financial statements ).

 

" Loan to Value Test " has the meaning given to it in the Term Loan B Agreement.

 

" Liquid Assets " means, at any date of determination under this Guarantee, the aggregate amount of Cash and Cash Equivalents of the Group determined on a consolidated basis in accordance with GAAP and as shown in the Latest Balance Sheet and, for the avoidance of doubt, "Cash and Cash Equivalents" include any amounts available under committed credit lines having remaining maturities of more than 6 months;

 

" Term Loan B Agreement " means the credit agreement dated as of 22 June 2017 and made between (i) International Seaways Operating Corporation as the administrative borrower, (ii) OIN Delaware LLC as co-borrower, (iii) the Guarantor, as Holdings, (iv) the other parties named therein as guarantors, (v) the lenders named therein, (vi) Jefferies Finance LLC as administrative agent, (vii) Jefferies Finance LLC as collateral agent and mortgage trustee, (viii) Skandinaviska Enskilda Banken AB (publ) as issuing bank, (ix) Jefferies Finance LLC and JPMorgan Chase Bank N.A. as joint lead arrangers, (x) Jefferies Finance LLC, JPMorgan Chase Bank N.A. and UBS Securities LLC as joint bookrunners and (xi) DNB Markets, Inc., Fearnley Securities Inc., Pareto Securities Inc. and Skandinaviska Enskilda Banken AB (publ) as co-managers but excluding and amendment, variation or supplement thereto or waiver thereunder.

 

 

 

 

" Total Indebtedness " means, total Indebtedness determined on a consolidated basis in accordance with GAAP and as shown in the Latest Balance Sheet.

 

11.6 Creditor notices

 

The Guarantor will send the Security Trustee, at the same time as they are despatched, copies of all material communications which are despatched to the Guarantor's creditors or any class of them.

 

11.7 Consents

 

The Guarantor will maintain in force and promptly obtain or renew, and will promptly send certified copies to the Security Trustee of, all consents required:

 

(a) for the Guarantor to perform its obligations under this Guarantee; and

 

(b) for the validity or enforceability of this Guarantee,

 

and the Guarantor will comply with the terms of all such consents.

 

11.8 Notification of litigation

 

The Guarantor will provide the Security Trustee with details of any legal or administrative action involving the Guarantor as soon as such action is instituted or it becomes apparent to the Guarantor that it is likely to be instituted, unless the legal or administrative action is not material in the context of this Guarantee.

 

11.9 Notification of default

 

The Guarantor will notify the Security Trustee as soon as the Guarantor becomes aware of the occurrence of an Event of Default or Guarantee Facility Event of Default or a Potential Event of Default and will thereafter keep the Security Trustee fully up-to-date with all developments.

 

11.10 Maintenance of status

 

The Guarantor will maintain its separate corporate existence and remain in good standing under the laws of the Republic of the Marshall Islands.

 

11.11 Negative undertakings

 

The Guarantor will not change its principal activity from its current industrial sector at the date of this Guarantee or operate outside the scope of its Articles of Incorporation.

 

11.12 No disposal of assets, change of business

 

The Guarantor will not, and shall procure that none of its subsidiaries will:

 

(a) transfer, lease or otherwise dispose of all or a substantial part of its assets, whether by one transaction or a number of transactions, whether related or not except in the usual course of its business and except for transfers within the Group; or

 

(b) make any substantial change to the nature of its business from that existing at the date of this Guarantee.

 

 

 

 

11.13 Maintenance of ownership of Africa Tanker Corporation

 

The Guarantor shall remain the legal and beneficial owner, directly or indirectly of all of the issued and allotted share capital of Africa Tanker Corporation.

 

11.14 No merger etc.

 

The Guarantor shall not enter into any form of merger, sub-division, amalgamation or other reorganisation which would have a material adverse effect on the financial position of the Guarantor or cause a breach by the Guarantor under this Guarantee after taking into account the effects of such merger, sub-division, amalgamation or other reorganisation.

 

11.15 Maintenance of ownership of Borrowers

 

The Guarantor shall procure that Africa Tanker Corporation remains the legal holder of 50 per cent. of the issued and allotted share capital of each of TI Africa and TI Asia.

 

Provided always that share transfers in respect of the shares in each Borrower shall be permitted in accordance with clause 12.4 of the Loan Agreement.

 

11.16 Compliance with Sanctions Laws

 

The Guarantor shall:

 

(a) ensure that neither it, nor any of its subsidiaries is or will become a Restricted Party;

 

(b) use reasonable endeavours to procure that no director, officer, employee, agent or representative of it or any of its respective subsidiaries is or will become a Restricted Party; and

 

(c) procure that no proceeds of any Tranche shall be made available, directly or indirectly, to or for the benefit of a Restricted Party nor shall they otherwise be applied in a manner for a purpose prohibited by Sanctions Laws.

 

11.17 Compliance with Service Contracts

 

The Guarantor shall procure that the Borrowers comply with their obligations under the Service Contracts.

 

11.18 Maintenance of Borrower Status

 

The Guarantor shall procure that neither Borrower carries on any business other than the ownership, chartering and operation of the FSO owned by it.

 

11.19 Compliance with laws

 

The Guarantor shall comply in all material respects with all applicable laws and regulations to which it may be subject.

 

11.20 Repair and classification

 

The Guarantor shall procure that the FSOs owned by the Borrowers are maintained in a good and safe condition and state of repair:

 

 

 

 

(a) consistent with first-class ship ownership and management practice;

 

(b) so as to maintain that FSO's class as referred to in the relevant Service Contract (namely segregated ballast tanks Floating, Storage and Offloading Facility with class notation +A1 (SBT) (FSO) (DH) (S)20 with America Bureau of Shipping, Lloyd's Register, Bureau Veritas or Det Norske Veritas) free of overdue recommendations and conditions affecting that FSO's class; and

 

(c) so as to comply with all laws and regulations applicable to vessels registered at ports in the Approved Flag or to vessels operating or trading to any jurisdiction to which that FSO may trade from time to time, including but not limited to the ISM Code and the ISPS Code.

 

11.21 Maintenance of status

 

The Guarantor shall maintain its listing on the New York Stock Exchange or such other reputable international stock exchange approved by the Agent (acting on the instructions of the Majority Lenders) in writing, such approval not to be unreasonably withheld or delayed.

 

11.22 Right to remedy breach of Euronav Guarantee

 

If for any reason and at any time Euronav is in breach of any of the terms of the Euronav Guarantee:

 

(a) the Security Trustee shall notify the Guarantor of such breach;

 

(b) the Guarantor may remedy such breach at any time no later than 30 days after the date of the Security Trustee's notice by delivering a duly executed Limitation Removal Notice on the Security Trustee together with reasonable evidence that the Guarantor's execution of the Limitation Removal Notice has been duly authorised by it.

 

12 Judgments and Currency Indemnity

 

12.1 Judgments relating to Loan Agreement or Master Agreements

 

This Guarantee shall cover any amount payable by the Borrowers (or any of them) under or in connection with any judgment relating to the Loan Agreement or any Master Agreement.

 

12.2 Currency indemnity

 

In addition, clause 20.4 (currency indemnity) of the Loan Agreement shall apply, with any necessary adaptations, in relation to this Guarantee.

 

13 Set-Off

 

13.1 Application of credit balances

 

Each Creditor Party may, at any time after the occurrence of an Event of Default which is continuing or a Guarantee Facility Event of Default which is continuing, with prior notice:

 

(a) apply any balance (whether or not then due) which at any time stands to the credit of any account in the name of the Guarantor at any office in any country of that Creditor Party in or towards satisfaction of any sum then due from the Guarantor to that Creditor Party under this Guarantee; and

 

 

 

 

(b) for that purpose:

 

(i) break, or alter the maturity of, all or any part of a deposit of the Guarantor;

 

(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 reasonably considers appropriate.

 

13.2 Existing rights unaffected

 

No Creditor Party shall be obliged to exercise any of its rights under Clause 13.1 ( Application of credit balances ); 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 a Creditor Party is entitled (whether under the general law or any document).

 

13.3 Sums deemed due to a Lender

 

For the purposes of this Clause 13 ( Set-Off ), a sum payable by the Guarantor to the Agent or the Security Trustee for distribution to, or for the account of, a Lender shall be treated as a sum due to that Lender; and each Lender's proportion of a sum so payable for distribution to, or for the account of, the Lenders shall be treated as a sum due to that Lender.

 

14 Supplemental

 

14.1 Continuing guarantee

 

This Guarantee shall remain in force as a continuing security at all times during the Security Period.

 

14.2 Rights cumulative, non-exclusive

 

The Security Trustee's rights under and in connection with this Guarantee are cumulative, may be exercised as often as appears expedient and shall not be taken to exclude or limit any right or remedy conferred by law.

 

14.3 No impairment of rights under Guarantee

 

If the Security Trustee omits to exercise, delays in exercising or invalidly exercises any of its rights under this Guarantee, that shall not impair that or any other right of the Security Trustee under this Guarantee.

 

14.4 Severability of provisions

 

If any provision of this Guarantee is or subsequently becomes void, illegal, unenforceable or otherwise invalid, that shall not affect the validity, legality or enforceability of its other provisions.

 

14.5 Guarantee not affected by other security

 

This Guarantee shall not impair, nor be impaired by, any other guarantee, any Security Interest or any right of set-off or netting or to combine accounts which the Security Trustee or any other Creditor Party may now or later hold in connection with the Loan Agreement and/or any Master Agreement.

 

 

 

 

14.6 Guarantor bound by Loan Agreement

 

The Guarantor agrees with the Security Trustee to be bound by all provisions of the Loan Agreement which are applicable to the Guarantor as if those provisions had been set out (with any necessary modifications) in this Guarantee.

 

14.7 Applicability of provisions of Guarantee to other Security Interests

 

Any Security Interest which the Guarantor creates (whether at the time at which it signs this Guarantee or at any later time) to secure any liability under this Guarantee shall be a principal and independent security, and Clauses 3 ( Liability as Principal and Independent Debtor ) and 17 ( Invalidity of Loan Agreement or Master Agreement ) shall, with any necessary modifications, apply to it, notwithstanding that the document creating the Security Interest neither describes it as a principal or independent security nor includes provisions similar to Clauses 3 ( Liability as Principal and Independent Debtor ) and 17 ( Invalidity of Loan Agreement or Master Agreement ).

 

14.8 Applicability of provisions of Guarantee to other rights

 

Clauses 3 ( Liability as Principal and Independent Debtor ) and 17 ( Invalidity of Loan Agreement or Master Agreement ) shall also apply to any right of set-off or netting or to combine accounts which the Guarantor creates by an agreement entered into at the time of this Guarantee or at any later time (notwithstanding that the agreement does not include provisions similar to Clauses 3 ( Liability as Principal and Independent Debtor ) and 17 ( Invalidity of Loan Agreement or Master Agreement )), which refers to this Guarantee.

 

14.9 Third party rights

 

A person (other than a Creditor Party) who is not a party to this Guarantee has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Guarantee.

 

15 Assignment

 

15.1 Assignment by Security Trustee

 

The Security Trustee may assign its rights under and in connection with this Guarantee to the same extent as it may assign its rights under the Loan Agreement.

 

16 Notices

 

16.1 Notices to Guarantor

 

Any notice or demand to the Guarantor under or in connection with this Guarantee shall be given by letter or fax at:

 

c/o International Seaways Ship Management LLC
600 Third Avenue, 39 th Floor
New York, New York 10016

 

Fax No.: 212-578-1832

 

Email: LegalDepartment@intlseas.com

 

Attn: Chief Financial Officer

 

or to such other address which the Guarantor may notify to the Security Trustee.

 

 

 

 

16.2 Application of certain provisions of Loan Agreement

 

Clauses 33.3, 33.4 and 33.5 of the Loan Agreement apply to any notice or demand under or in connection with this Guarantee.

 

16.3 Validity of demands

 

A demand under this Guarantee shall be valid notwithstanding that it is served:

 

(a) on the date on which the amount to which it relates is payable by the Borrowers (or any of them) under the Loan Agreement or, as the case may be, a Master Agreement;

 

(b) at the same time as the service of a notice under clause 18.2 ( Actions following an Event of Default ) of the Loan Agreement;

 

and a demand under this Guarantee may refer to all amounts payable under or in connection with the Loan Agreement and/or any Master Agreement without specifying a particular sum or aggregate sum.

 

16.4 Notices to Security Trustee

 

Any notice to the Security Trustee under or in connection with this Guarantee shall be sent to the same address and in the same manner as notices to the Security Trustee under the Loan Agreement.

 

17 Invalidity of Loan Agreement or Master Agreements

 

17.1 Invalidity of Loan Agreement

 

In the event of:

 

(a) the Loan Agreement now being or later becoming, with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any other reason whatsoever, whether of a similar kind or not; or

 

(b) without limiting the scope of paragraph (a), a bankruptcy of any Borrower, the introduction of any law or any other matter resulting in any Borrower being discharged from liability under the Loan Agreement, or the Loan Agreement ceasing to operate (for example, by interest ceasing to accrue),

 

this Guarantee shall cover any amount which would have been or become payable under or in connection with the Loan Agreement if the Loan Agreement had been and remained entirely valid, legal and enforceable, or the Borrowers had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrowers had remained fully liable under it for liabilities whether invalidly incurred or validly incurred but subsequently retrospectively invalidated; and references in this Guarantee to amounts payable by the Borrowers under or in connection with the Loan Agreement shall include references to any amount which would have so been or become payable as aforesaid.

 

 

 

 

17.2 Invalidity of Master Agreements or Finance Documents

 

Clause 17.1 ( Invalidity of Loan Agreement ) also applies to each Master Agreement and each of the other Finance Documents to which any Borrower is a party.

 

18 Governing Law and Jurisdiction

 

18.1 English law

 

This Guarantee and any non-contractual obligations arising out of or in connection with it shall be governed by, and construed in accordance with, English law.

 

18.2 Exclusive English jurisdiction

 

Subject to Clause 18.3 ( Choice of forum for the exclusive benefit of the Security Trustee ), the courts of England shall have exclusive jurisdiction to settle any Disputes.

 

18.3 Choice of forum for the exclusive benefit of the Security Trustee

 

Clause 18.2 ( Exclusive English jurisdiction ) is for the exclusive benefit of the Security Trustee, which reserves the rights:

 

(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 matter; 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.

 

The Guarantor shall not commence any proceedings in any country other than England in relation to a Dispute.

 

18.4 Process agent

 

The Guarantor irrevocably appoints the Law Debenture Corporation p.l.c. presently at Fifth Floor, 100 Wood Street, London, England EC2V 7EX or such other entity as Guarantor shall notify the Security Trustee, to act as its agent to receive and accept on its behalf any process or other document relating to any proceedings in the English courts which are connected with this Guarantee.

 

18.5 Creditor Parties' rights unaffected

 

Nothing in this Clause 18 ( Governing Law and Jurisdiction ) shall exclude or limit any right which any Creditor Party may have (whether under the law of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.

 

18.6 Meaning of "proceedings"

 

In this Clause 18 ( Governing Law and Jurisdiction ), " proceedings " means proceedings of any kind, including an application for a provisional or protective measure and a " Dispute " means any dispute arising out of or in connection with this Guarantee (including a dispute relating to the existence, validity or termination of this Guarantee or any non-contractual obligation arising out of or in connection with this Guarantee).

 

 

 

 

 

This Guarantee has been entered into on the date stated at the beginning of this Guarantee.

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 12

 

INTERNATIONAL SEAWAYS, INC.

 

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

 

    Three months ended     Year ended December 31,  
(dollars in thousands)   March 31, 2018     2017     2016     2015     2014     2013  
Earnings:                                                
(Loss)/income from continuing operations before income taxes     (29,308 )     (106,044 )     (17,783 )     173,310       (118,355 )     (719,588 )
Add: Distributions from equity investees, net of equity in (earnings) of equity investees     275       (8,677 )     684       (1,166 )     (2,827 )     (33,460 )
Add: Fixed charges     13,221       49,147       47,762       51,234       85,505       21,108  
Less: Interest capitalized during the period     -       -       -       -       -       -  
Add: Amortization of capitalized interest     300       1,400       1,400       1,400       1,400       1,800  
Total earnings     (15,512 )     (64,174 )     32,063       224,778       (34,277 )     (730,140 )
Fixed Charges:                                                
Interest expense (a)     11,621       41,247       40,362       44,134       74,105       1,408  
Less: Amounts attributable to early retirement of debt     -       -       -       -       -       -  
Interest capitalized during the period     -       -       -       -       -       -  
Interest component of rental expense     1,600       7,900       7,400       7,100       11,400       19,700  
Total fixed charges     13,221       49,147       47,762       51,234       85,505       21,108  
RATIO OF EARNINGS TO FIXED CHARGES     b       c       d       4.39       e       f  

 

a Interest expense includes pension benefit obligation interest and amortization of debt expense and any discount or premium related to indebtedness.

 

b Due to the registrant's loss in the first quarter of 2018, the ratio coverage was less than 1:1. The registrant must generate additional earnings of $28,733 to achieve a coverage of 1:1.

 

c Due to the registrant's loss in 2017, the ratio coverage was less than 1:1. The registrant must generate additional earnings of $113,321 to achieve a coverage of 1:1.

 

d Due to the registrant's loss in 2016, the ratio coverage was less than 1:1. The registrant must generate additional earnings of $15,699 to achieve a coverage of 1:1.

 

e Due to the registrant's loss in 2014, the ratio coverage was less than 1:1. The registrant must generate additional earnings of $119,782 to achieve a coverage of 1:1.

 

f Due to the registrant's loss in 2013, the ratio coverage was less than 1:1. The registrant must generate additional earnings of $751,248 to achieve a coverage of 1:1.

 

 

 

 

Exhibit 23.1

  

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of International Seaways, Inc. of our report dated March 31, 2017, except with respect to the opinion on the financial statement schedule, as to which the date is March 12, 2018, and except with respect to our opinion on the financial statements and financial statement schedule insofar as it relates to the impact of the Company’s retrospective application of Financial Accounting Standards Board Accounting Standards Update No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASC 715), No. 2016-18, Statement of Cash Flows (ASC 230): Restricted Cash , and No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (ASC 230) as discussed in Note 2, as to which the date is May 14, 2018, relating to the financial statements and financial statement schedule, which appears in International Seaways, Inc.'s Current Report on Form 8-K dated May 14, 2018. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

 

 

/s/ PricewaterhouseCoopers LLP

 

New York, NY

May 14, 2018

 

     

Exhibit 23.3

  

Consent of Independent Registered Public Accounting Firm

 

We consent to the reference to our firm under the caption "Experts" and to the use of our report dated March 12, 2018 (except for Note 2, as to which the date is May 14, 2018), with respect to the consolidated financial statements and schedule of International Seaways, Inc. and our report dated March 12, 2018, with respect to the effectiveness of internal control over financial reporting in Amendment No. 1 to the Registration Statement (Form S-3) and related Prospectus of International Seaways, Inc. for the registration of debt securities and preferred stock.

 

 

 

/s/ Ernst & Young LLP

 

New York, NY

May 14, 2018