Prestige Cruises International, Inc. (Form: S-1/A, Received: 03/24/2014 15:50:25)

Large accelerated filer

Accelerated filer

Non-accelerated filer

x (Do not check if a smaller reporting company)

Smaller reporting company

As filed with the Securities and Exchange Commission on March 24, 2014

Registration Statement No. 333-193479

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

AMENDMENT NO. 1

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Prestige Cruises International, Inc.

(Exact name of registrant as specified in its charter)

Republic of Panama

4400

98-0622952

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

8300 NW 33rd Street, Suite 100

Miami, Florida 33122

(305) 514-2300

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

Jill Guidicy

General Counsel

Prestige Cruises International, Inc.

8300 NW 33rd Street, Suite 100 Miami, Florida 33122

Phone: (305) 514-2300

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

Copy to:

Tracey A. Zaccone, Esq.

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019-6064

(212) 373-3000

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

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 check the following box: ¨

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 post-effective amendment filed pursuant to Rule 462(d) 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. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b2 of the Exchange Act.

CALCULATION OF REGISTRATION FEE



Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price (1)(2)	Amount of Registration Fee
Common stock, par value $.01 per share	$250,000,000	$32,200*

(1)	Includes shares that the underwriters have the option to purchase to cover over-allotments, if any.

(2)	Estimated solely for the purposes of computing the registration fee in accordance with Rule 457 under the Securities Act of 1933, as amended.

*	Previously paid.

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 of 1933, as amended, or until this 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 is effective. This preliminary prospectus is not an offer to sell these securities, and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to Completion, dated March 24, 2014

LOGO

Prestige Cruises International, Inc.

Common Stock

This is the initial public offering of common stock, par value $0.01 per share, of Prestige Cruises International, Inc. We are offering shares of common stock.

Prior to this offering, there has been no public market for our common stock. We expect the initial public offering price will be between $ and $ per share. We expect to apply for listing of our common stock on the under the symbol “ .”

We have granted the underwriters an option for a period of 30 days to purchase from us an aggregate of up to additional shares of common stock to cover over-allotments, if any.

Investing in our common stock involves a high degree of risk. See “ Risk Factors ” beginning on page 20 to read about certain factors you should consider before buying our common stock.

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


	Per Share	Total
Initial public offering price	$	$
Underwriting discounts and commissions	$	$
Proceeds to us before expenses	$	$

The underwriters expect to deliver the shares on or about , 2014.

Prospectus dated , 2014.

TABLE OF CONTENTS


	Page
Prospectus Summary		1
Risk Factors		20
Use of Proceeds		36
Dividend Policy		37
Capitalization		38
Dilution		39
Selected Consolidated Financial Data		41
Unaudited Pro Forma Consolidated Financial Data		43
Management’s Discussion and Analysis of Financial Condition and Results of Operations		46
Business		65
Management		86
Executive Compensation		91
Director Compensation		110
Principal Shareholders		111
Certain Relationships and Related Party Transactions		113
Description of Certain Indebtedness		115
Description of Capital Stock		121
Shares Eligible for Future Sale		126
Material U.S. Federal Income Tax Considerations		127
Certain Panamanian Tax Consequences		130
Underwriting		131
Legal Matters		136
Experts		136
Additional Information		136
Index to Consolidated Financial Statements		F-1

Neither we nor the underwriters have authorized anyone to provide you with different or additional information other than that contained in this prospectus, any amendment or supplement to this prospectus or any free writing prospectus prepared by us or on our behalf. Neither we nor the underwriters take any responsibility for, nor can provide any assurance as to the reliability of, any information other than the information in this prospectus, any amendment or supplement to this prospectus or any free writing prospectus prepared by us or on our behalf. We and the underwriters are offering to sell, and seeking offers to buy, our common stock only in jurisdictions where offers and sales are permitted. The information in this prospectus is accurate only as of the date of this prospectus or such other date stated in this prospectus, regardless of the time of delivery of this prospectus or any sale of our common stock, and our business, financial condition, results of operations and/or prospects may have changed since those dates.

Until , 2014 (the 25 ^th day after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligations to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

TERMS USED IN THIS PROSPECTUS

Unless otherwise indicated by the context, references in this prospectus to (i) the “Company,” “we,” “our,” “us,” “PCI” and “Prestige” refer to Prestige Cruises International, Inc., a Panamanian corporation, together with its consolidated subsidiaries. Prestige Cruises International, Inc. is the parent of Prestige Cruise Holdings, Inc. (“PCH”), which in turn is the parent of Oceania Cruises, Inc. (“Oceania”) and the parent of Seven Seas Cruises S. DE R.L. (“Regent”).

Unless otherwise indicated, the following terms have the meanings set forth below:

•

Adjusted EBITDA refers to EBITDA as adjusted and described in footnote 10 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Adjusted EBITDA Margin refers to Adjusted EBITDA as a percentage of total revenue;

•

APCD or Available Passenger Cruise Days refers to a measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period. See footnote 9 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Apollo or our sponsor refers collectively to funds affiliated with Apollo Global Management, LLC, which manages the funds, and their affiliates;

•

Berths refers to double occupancy capacity per suite, in accordance with cruise industry practice, even though many suites can accommodate three or more passengers;

•

CAGR refers to compound annual growth rate;

•

Charter refers to the hire of a ship for a specified period of time;

•

CLIA refers to Cruise Lines International Association, Inc. a marketing and training organization formed in 1975 to promote cruising. CLIA North America is composed of 26 cruise lines. CLIA’s website can be found at www.cruising.org;

•

Drydock refers to a dock that can be kept dry for use during the inspection or repairing of ships, and also refers to the scheduled or unscheduled removal of a vessel from regular service for maintenance or inspection in a drydock;

•

EBITDA refers to net income (loss) excluding depreciation and amortization, net interest expense and income tax benefit (expense). See footnote 10 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

EPS refers to earnings (loss) per share;

•

GAAP refers to the preparation of financial statements in accordance with generally accepted accounting principles in the United States of America set forth in accounting standards established by the Financial Accounting Standards Board (“FASB”). References to GAAP are to the FASB Accounting Standards Codification, sometimes referred to as the Codification or ASC;

•

Gross Cruise Cost refers to the sum of cruise operating expenses and selling and administrative expenses;

•

Gross Tons refers to a unit of enclosed passenger space on a cruise ship, such that one gross ton equals 100 cubic feet or 2.831 cubic meters;

•

Gross Yield refers to total revenues, excluding charter per APCD. See footnote 9 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

IMO refers to the International Maritime Organization, a United Nations agency that sets international standards for shipping;

•

MARPOL refers to the International Convention for the Prevention of Pollution from Ships, an international environmental regulation;

•

Major North American Cruise Brands refers to Carnival Cruise Lines, Celebrity Cruises, Holland America, Norwegian Cruise Line, Oceania Cruises, Princess Cruises, Regent Seven Seas and Royal Caribbean International;

•

Net Cruise Cost refers to Gross Cruise Cost excluding commissions, transportation and other expenses and onboard and other expenses. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Net Debt refers to our outstanding senior secured indebtedness less cash and cash equivalents;

•

Net Per Diem refers to Net Revenue divided by Passenger Days Sold. We utilize Net Per Diems to manage our business on a day-to-day basis. We believe that it is the most relevant measure of our performance as it reflects the revenues earned by us, net of our most significant variable costs. See footnote 9 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Net Revenue refers to total revenues, less charter revenue less commissions, transportation and other expenses and onboard and other expenses;

•

Net Revenue Adjusted EBITDA Margin refers to Adjusted EBITDA divided by net revenue;

•

Net Yield refers to Net Revenue divided by APCD. See footnote 9 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Occupancy Percentage refers to the ratio of Passenger Days Sold to APCD;

•

Oceania, Oceania Cruises or OCI refers to Oceania Cruises, Inc., a Panamanian corporation and a subsidiary of Prestige Cruise Holdings, Inc.;

•

PCH refers to Prestige Cruise Holdings, Inc., a Panamanian corporation and a subsidiary of Prestige Cruises International, Inc.;

•

PCI, Prestige, the Company, we, our or us refers to Prestige Cruises International, Inc., together with its consolidated subsidiaries;

•

PCS refers to Prestige Cruise Services, LLC, a subsidiary of Oceania Cruises, Inc.;

•

PDS or Passenger Days Sold refers to the number of revenue passengers carried for the period multiplied by the number of days within the period in their respective cruises. See footnote 9 in “Prospectus Summary—Summary Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operational and Financial Metrics, including Non-GAAP Measures;”

•

Public Cruise Companies refers to Carnival Corp., Norwegian Cruise Line Holdings Ltd. and Royal Caribbean Cruises Ltd.;

•

Regent , Regent Seven Seas or SSC refers to Seven Seas Cruises S. DE R.L. and its subsidiaries;

iii

•

Regent Seven Seas Transaction refers to the transaction that closed on January 31, 2008, pursuant to which Seven Seas Cruises S. DE R.L. purchased substantially all of the assets of Regent Seven Seas Cruises, Inc. and the equity of certain of its affiliated companies and joint ventures from Carlson Cruises Worldwide, Inc. and Vlasov Shipping Corporation;

•

SOLAS refers to the International Convention for the Safety of Life at Sea, a body of international regulations dealing with ship and operational safety standards;

•

STCW refers to the Standard of Training Certification and Watchkeeping for mariners; and

•

Upscale segment refers to the combined characteristics of the Upper Premium and Luxury segments of the cruise industry. See “Prospectus Summary—Our Industry—Multiple Segments”.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include statements other than those that directly or exclusively relate to historical facts, including, without limitation, those regarding our business strategy, financial position, results of operations, plans, prospects and objectives of management for future operations (including development plans and objectives relating to our activities). Many, but not all, of these statements can be found by looking for terms like “expect,” “anticipate,” “goal,” “project,” “plan,” “believe,” “seek,” “could,” “will,” “may,” “might,” “forecast,” “estimate,” “intend,” and “future” and for similar words. Forward-looking statements reflect management’s current expectations and do not guarantee future performance and may involve risks, uncertainties and other factors that are difficult to predict and many of which are beyond our control. These factors could cause our actual results, performance, or achievements to differ materially from the future results, performance, or achievements expressed or implied in those forward-looking statements. Examples of these risks, uncertainties and other factors include, but are not limited to:

•

adverse economic conditions that may affect consumer demand for cruises, such as declines in the securities and real estate markets, declines in disposable income and consumer confidence;

•

changes in cruise capacity, as well as capacity changes in the overall vacation industry;

•

intense competition from other cruise companies, as well as non-cruise vacation alternatives, which may affect our ability to compete effectively;

•

the delivery schedules and estimated costs of newbuilds, in particular the Seven Seas Explorer , on terms that are favorable or consistent with our expectations;

•

our substantial leverage, our potential inability to generate the necessary amount of cash to service our existing debt and the potential incurrence of substantial indebtedness in the future;

•

continued borrowing availability under our Secured Credit Facilities (as defined herein) and compliance with our covenants;

•

changes in interest rates, foreign currency rates, fuel costs or other cruise operating costs;

•

the risks associated with operating internationally;

•

changes in general economic, business and geopolitical conditions;

•

the impact of changes in the global credit markets on our ability to borrow and our counterparty credit risks, including with respect to our Secured Credit Facilities, derivative instruments, contingent obligations and insurance contracts;

•

the impact of problems encountered at shipyards, as well as any potential claim, impairment, loss, cancellation or breach of contract in connection with any contracts we have with shipyards;

•

the impact of any future changes relating to how travel agents sell and market our cruises;

•

the impact of any future increases in the price of, or major changes or reduction in, commercial airline services;

•

the impact of seasonal variations in passenger fare rates and occupancy levels at different times of the year;

•

adverse events impacting the security of travel that may affect consumer demand for cruises, such as terrorist acts, acts of piracy, armed conflict and other international events, including political hostilities or war;

•

the impact of the spread of contagious diseases;

•

the impact of mechanical failures or accidents involving our ships and the impact of delays, costs and other factors resulting from emergency ship repairs, as well as scheduled maintenance, repairs and refurbishment of our ships;

•

accidents, criminal behavior and other incidents affecting the health, safety, security and vacation satisfaction of passengers and causing damage to ships, which could, in each case, cause reputation harm, the modification of itineraries or cancellation of a cruise or series of cruises;

•

the continued availability of attractive port destinations;

•

our ability to attract and retain qualified shipboard crew members and key personnel; and

•

changes involving the corporate, tax, environmental, health, safety and other regulatory regimes in which we operate.

The above examples are not exhaustive and speak only as of the date of this prospectus. These and other factors are more fully discussed in the “Risk Factors” section and elsewhere in this prospectus. These risks could cause actual results to differ materially from those implied by forward-looking statements in this prospectus.

From time to time, new risks emerge and existing risks increase in relative importance to our operations. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in our expectations with regard thereto or any change of events, conditions or circumstances on which any such statement was based. Such forward-looking statements are based on our current beliefs, assumptions, expectations, estimates and projections regarding our present and future business strategies and the environment in which we will operate in the future. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section and in this prospectus, particularly in “Risk Factors.”

MARKET AND INDUSTRY DATA AND FORECASTS

This prospectus includes market share and industry data and forecasts that we obtained from industry publications, third-party surveys and internal company surveys. Industry publications, including those from the Cruise Lines International Association, Inc. (“CLIA”) and surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable. All CLIA information, obtained from the CLIA website “www.cruising.org,” relates to CLIA member lines, which currently include 26 of the major North American cruise lines, including both Regent and Oceania. According to CLIA, CLIA North America member lines cumulatively represented approximately 73% of the 2013 estimated global cruise capacity. All other references to third-party information are to information that is publicly available at nominal or no cost. We use the most currently available industry and market data to support statements as to our market position.

Although we believe that the industry publications and third-party sources are reliable, we have not independently verified any of the data from industry publications or third-party sources. Similarly, while we believe our internal estimates with respect to our industry are reliable, our estimates have not been verified by any independent sources. While we are not aware of any misstatements regarding any industry data presented herein, our estimates, in particular as they relate to market share and our general expectations, involve risks and uncertainties and are subject to change based on various factors, including those discussed under “Risk Factors,” “Cautionary Statement Concerning Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this prospectus.

PROSPECTUS SUMMARY

This summary highlights information about us and the offering contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in our common stock. You should read this entire prospectus carefully before making an investment decision, including the sections entitled “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements” and our consolidated financial statements and related notes included elsewhere in this prospectus.

Our Company

We are the market leader in the Upscale segment, which is comprised of the Upper Premium and Luxury segments of the $29 billion cruise industry. We represent approximately 46% of the combined berth capacity of the Upscale segment. We are focused on providing our guests with experiences that are centered around gourmet cuisine, high quality service, luxurious accommodations and distinctive itineraries to destinations worldwide. Our cruise vacations are tailored to the preferences of affluent individuals globally, who are generally 55 years of age and older. This target market, referred to as the baby-boomers in the United States, is both the largest and fastest growing U.S. demographic. Our focus on this demographic allows us to deliver a vacation lifestyle that our guests can expect, enjoy and are willing to pay a premium price to experience. Our brands, Oceania and Regent, are comprised of eight cruise ships, with a ninth under construction for Regent. We believe our two-brand strategy is key to maintaining our market leading position, as it allows us to offer products in the Upscale segment with distinct brand promises to a growing global demographic.

Our ships have limited guest capacity per ship, ranging from 490 to 1,250 guests, and are significantly smaller than the typical 3,000+ passenger ships operated by the Contemporary and Premium segment brands. Our stateroom accommodations are large and luxurious, consistent with an upscale and exclusive cruise experience, with 87% of the suites and staterooms on our ships featuring private balconies. Our onboard dining is a central highlight of our cruise experience and features multiple open seating gourmet dining venues where guests may dine when, where and with whom they wish. Our ships are staffed with a crew-to-guest ratio of approximately 1 to 1.6, further promoting a high level of service. This luxury-focused product offering drives our industry leading Net Yields. We believe our targeted focus on gourmet cuisine, high quality service and luxurious accommodations allows us to continue to grow Net Yields across our entire fleet, which allows us to experience a more consistent and predictable return on invested capital over the useful life of our ships.

We focus on deploying our ships to high demand and in-season locations worldwide. Our smaller ship size allows us to travel to more remote ports around the world, thereby meeting our guests’ demand for experiencing the most sought after destinations. The duration of our cruises varies from seven to 180 days, featuring worldwide itineraries that visit approximately 350 ports, including destinations such as Scandinavia, Russia, the Mediterranean, the Greek Isles, Alaska, Canada and New England, Asia, Tahiti and the South Pacific, Australia and New Zealand, Africa, India, South America, the Panama Canal and the Caribbean. We also have the only cruise line (Oceania) to offer a port-intensive 180 day “Around the World” cruise that circumnavigates the globe.

Our affluent and mostly retired or semi-retired guests plan their cruise vacations well ahead of sail date, which gives us high visibility into our future revenues. On average, guests book cruises over seven months in advance of sail date, which provides us ample lead time to effectively plan our sales and marketing initiatives and optimize our industry leading Net Yields. Because of the more all-inclusive nature of our product offerings, we generate a larger share of our overall revenue at time of booking compared to the rest of the industry, which provides us with even greater visibility into our total revenues. Another key differentiating factor is our disciplined and transparent go-to-market strategy. Unlike most cruise lines that discount inventory regularly to fill capacity (“price to fill”), our strategy to maximize revenue is to increase marketing efforts (“market to fill”) as the cruise date approaches. We clearly articulate to customers and travel agents that our initial launch offers

will be our lowest price offering and that these prices are subject to increase as the cruise date approaches, as well as the specific dates on which those increases may occur. This strategy allows us to maintain and improve our high price point, which is fundamental in the Upscale segment.

Our senior management team has delivered consistent revenue, EBITDA and net income growth, producing measurable improvements in all three growth phases of the cruise industry. Frank J. Del Rio launched a new brand with the introduction of Oceania in 2003 and leads the company as our Chairman and CEO. In 2008, we acquired Regent and improved our results following the acquisition, including generating $18.0 million in cost synergies and increasing occupancy and yields. We also commenced a newbuild program resulting in the successful launch of Oceania’s Marina in January 2011 and Oceania’s Riviera in April 2012. We are committed to maintaining a disciplined growth strategy to maximize shareholder value by profitably growing our business while continuing to reduce our debt and increase our return on invested capital.

Our operating structure is integrated, with both of our brands sharing a single headquarter location and back office functions. This approach creates a culture of institutionalizing best practices, driving efficiencies and taking advantage of scale. Our brands maintain separate sales and marketing teams as well as dedicated reservation centers, which allows each brand to maintain and effectively communicate its unique identity and brand promise. This balanced approach allows us to keep our overhead expenditures low and our competitive position strong. This strategy also allows us to leverage our scale in order to develop international source markets effectively and permits other efficiencies, such as implementing a common reservation system, shared data center and a common pool of well trained and experienced onboard crew and officers.

For the year ended December 31, 2013, total revenue was approximately $1.2 billion, operating income was approximately $163.2 million and net income was approximately $35.5 million. These results are increases over our results for 2012 and are attributable to, among other factors, Net Yield growth and additional capacity in 2013. See “Management Discussion & Analysis—Executive Overview” for additional information regarding our financial results.

We believe EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin each provide a more complete understanding of our operating results, trends and financial performance than total revenue or net income. For the year ended December 31, 2013, Net Revenue, Adjusted EBITDA and Adjusted EBITDA Margin was $797.2 million, $255.8 million and 21.6%, respectively. When comparing our Adjusted EBITDA Margin to other cruise lines, it is important to note that our more inclusive product offering results in higher Commissions, transportation and other expense. Accordingly, we believe a more appropriate margin analysis is Net Revenue Adjusted EBITDA Margin, which is Adjusted EBITDA divided by Net Revenue, which was 32.1% for the year ended December 31, 2013. See “Prospectus Summary—Summary Consolidated Financial Information” for a reconciliation of net income to Adjusted EBITDA.

Our Brands

Oceania

Oceania was formed in 2003 by Frank J. Del Rio, now Chairman and CEO of our company, to focus on the under-penetrated midsize ship cruise market. Oceania specializes in offering destination-oriented cruise vacations, gourmet culinary experiences, elegant accommodations and personalized service at a compelling value. Oceania owns and operates a five ship fleet, comprised of three 684 guest R-Class ships: Regatta , Insignia and Nautica , and two new 1,250 guest O-Class ships: Marina and Riviera, which joined the fleet in 2011 and 2012, respectively.

per diems) and Premium ($150 to $250 per person per diems) segments of the cruise industry. Affluent guests, who historically have been loyal cruise customers on small and midsize ships, have seen the number of these type of ships diminish in recent years as the major cruise operators have focused on building ever larger ships (2500+ passengers) in the Premium cruise category.

In 2011 and 2012, Oceania took delivery of the first two O-Class vessels, Marina and Riviera , with a capacity of 1,250 guests each. We believe the O-Class ships are the world’s finest vessels designed and purpose-built for the Upper Premium market, expanding upon the popular elements featured on Oceania’s original fleet of vessels, with an emphasis on large suites and staterooms and an exceptional epicurean experience. The overall mix of suite and balcony stateroom accommodations on the O-Class ships of 95% positions these vessels to generate higher Net Yields than the R-Class ships, with 68% balcony staterooms.

Oceania is ranked as one of the world’s best cruise lines by Condé Nast Traveler , Travel + Leisure , and Cruise Critic . Oceania ships received “Best Dining,” “Best Public Rooms” and “Best Cabins” from Cruise Critic Cruisers’ Choice Awards in 2013. For 2014, Ocean & Cruise News awarded Riviera “Ship of the Year” and in 2012 Marina received the same award. These awards are industry-wide and usually determined based on each publications’ members, readers or editorial staff votes.

Regent

Regent is recognized as one of the world’s top luxury lines, and traces its origins to 1992, when Seven Seas Cruise Line merged with Diamond Cruise to become Radisson Seven Seas Cruises. In 2006, the cruise line was re-branded by its then-owner Carlson Company as Regent Seven Seas Cruises. Regent currently operates three award-winning, all-suite ships, comprised of Seven Seas Navigator , the all-balcony Seven Seas Mariner and the all-balcony Seven Seas Voyager , totaling 1,890 aggregate berths. We believe Regent offers the industry’s most all-inclusive cruise vacation experience, including free air transportation, a pre-cruise hotel night stay, premium wines and top shelf liquors, gratuities, and unlimited shore excursions.

Regent is currently building a 750 passenger ship, Seven Seas Explorer , for delivery in the summer of 2016, which we believe will further elevate the position of the Regent brand. The all-suite, all-balcony ship will feature sophisticated designer suites ranging from 300 to 3,500 square feet with an industry leading space ratio of 76.0 (gross ton per guest) and a crew-to-guest ratio of 1 to 1.4. The ship will include six open-seating gourmet restaurants, Regent’s signature nine-deck open atrium, a two-story theater, two boutiques and an expansive Canyon Ranch SpaClub ^® .

Regent focuses on providing guests with a high level of personal service, imaginative world-wide itineraries, unique shore excursions and land tours, world-class accommodations and top-rated cuisine. During 2013, Regent won the “Best for Luxury” award from the Cruise Critic Editor’s Pick Awards and was honored with the “World’s Best Service” award from Travel + Leisure . In 2013, Regent’s Seven Seas Voyager was awarded “Ship of the Year” from Ocean & Cruise News and in 2012 was also awarded “Best Cabins” by Condé Nast Traveler Reader’s Choice Awards. These awards are industry-wide and usually determined based on each publications’ members, readers or editorial staff votes.

Our Industry

We believe that the cruise industry demonstrates the following positive fundamentals:

Multiple Segments

The cruise industry’s brands have been historically segmented into the Contemporary, Premium, Upper Premium and Luxury categories. The figures and attributes in the following chart represent what we believe are the typical characteristics of the cruise industry segments:


			Upscale segment
Segment	Contemporary	Premium	Upper Premium	Luxury

Berths	1,700 – 5,000+	1,300 – 3,500+	684 – 1,250	200 – 1,070

Per Diem	$100 – $150	$150 – $250	$250 – $400	$500+

Pricing Model	A la carte	A la carte	A la carte	Inclusive

Length of Cruise	7 days or less	7 – 14 days	10 – 180 days	7 – 136+ days

Description	• Largest segment (~50% of market) • Larger ships with fixed dining and focus on onboard activities • Often the choice of first time cruisers	• Accounts for ~30% of market • Somewhat smaller ships with larger cabins and higher levels of service • Still appealing to broad market	• Unique combination of quality and value through midsized vessels • Destination-oriented cruises • Caters to the more experienced, affluent customer segment	• Ultra luxury and personalized service for affluent, experienced cruisers at industry leading per diems • Itineraries are extensive and unique • All-inclusive offering

We refer to the Upper Premium and Luxury categories collectively as the Upscale segment. The Premium segment typically includes cruises that range from seven to fourteen days. Premium cruises emphasize higher quality offerings, more personal comfort and greater worldwide itineraries, with higher average pricing than the Contemporary cruises. Upper Premium is a niche market segment created by Oceania in 2003 and defined by an experience that straddles the Premium and Luxury segments but with smaller ships than those operated by the Premium lines, higher space ratios, lower crew-to-guest ratios, more refined culinary programs, higher service standards and a greater destination-oriented focus than the Premium segment. The Luxury segment is characterized by the smallest vessel size, unique itineraries, the largest stateroom accommodations, gourmet culinary programs, highly personalized service and a more inclusive offering. These exclusive attributes, combined with limited supply growth and a growing worldwide target population, provide Upscale operators with significant pricing leverage as compared to the other segments of the cruise industry.

Strong Growth with Low Penetration and Significant Upside

Cruising represents a small but fast growing sector of the overall global vacation market. Cruising is a vacation alternative with broad appeal, as it offers a wide range of products, destinations and experiences from offerings in the Contemporary to Luxury segments to suit the various preferences of vacationing consumers of all ages, wealth levels and nationalities. Based on a 2011 CLIA market profile study, approximately 24% of the U.S. population has cruised at least once, with 11% having cruised within the last three years . Additionally, CLIA estimates that during 2013, over 17 million passengers went on a CLIA North America member cruise, an increase of 3.9% over the preceding year. According to CLIA, the number of cruise passengers has increased each year since 1995, as cruising has evolved from a niche vacation experience to a leisure holiday with broad appeal across all demographic groups. Despite this consistent growth, we believe the cruise industry still has low penetration levels compared to similar land-based vacations and highlights the continued growth potential for ocean going cruising. The future growth of the Contemporary and Premium segments, along with the normal aspirational life cycle of consumer preferences, is especially important for our company, because the vast majority of our first time guests are not first time cruisers. Accordingly, increases in the number of guests in the Contemporary and Premium segments will increase the pool of potential first time guests for our two brands.

The growth of the cruise industry depends, however, on consumers’ discretionary spending, and in the event that consumers’ disposable income or consumer confidence decreases as a result of an economic downturn or other factors, demand for cruises could decrease. See “Risk Factors—Risks Related to Our Business—Adverse economic conditions in North America and throughout the world and related factors such as fluctuating or increasing fuel prices, declines in the securities and real estate markets, and perceptions of these conditions could decrease the level of disposable income of consumers or consumer confidence and adversely affect our financial condition and results of operations.”

The chart below shows annual passenger growth based on CLIA’s North American member cruise lines:

LOGO

Source: CLIA

Attractive Demographics of Target Market

Long-term demographics are favorable for the cruise industry, in particular for the Upscale segment. Historically, people 55 years of age and older have had the highest disposable income levels and the most leisure time, making them prime candidates for Upscale cruising given the longer itineraries and higher per diems of cruises in that category. According to U.S. Census Bureau data, in 2010, the 55 years and older age group was comprised of 77 million individuals, representing approximately 25% of the U.S. population. This group is expected to increase to 89 million by 2015 and 106 million by 2025. The demographics in Europe are expected to follow a similar growth trend.

High Barriers to Entry

The cruise industry is characterized by high barriers to entry, including the existence of well-known and established consumer brands, the cost, time and personal relationships required to develop strong travel agent network partnerships necessary for success, the large capital expenditures required to build new and sophisticated ships, the limited number of ship builders with experience in constructing passenger ships and the long lead time necessary to construct new ships. Based on recently announced newbuilds and depending on the intended industry segment, the cost to build a new cruise ship can range from $340 million to $1.3 billion, or $195,000 to $741,000 per berth . The ultimate cost depends on the ship’s size and product offering, with the Upper Premium and Luxury segments having the highest cost per berth in the industry, ranging from $443,000 to $741,000 per berth. The Luxury segment in particular has demonstrated high barriers to entry with our competitors having participated in the market for an average of approximately 24 years. We believe that the newbuild pipeline in the Upscale segment is relatively favorable compared to the broader industry.

International Growth in Emerging Markets

Significant growth opportunities exist for sourcing guests from Europe and other international markets, as the percentage of guests from outside North America who have taken cruises is far lower than the percentage of North Americans. Emerging markets in Asia and the Pacific Rim also hold strong potential for us to source future cruise passengers. The increase in personal wealth in these and other emerging markets is particularly beneficial to the cruise industry, as historically, when the living standards improve in a country, the population first focuses on buying physical assets ( e.g., houses, cars, etc.) and then focuses on buying aspirational experiences, such as travel. There is significant economic uncertainty in emerging markets, however, and we cannot guarantee that personal wealth and discretionary spending will continue to increase in these markets. While the growth in cruising outside of North America has been increasing at a considerably faster pace than within North America, this pace could slow if personal wealth and discretionary spending in emerging markets do not continue to increase.

Our Competitive Strengths

We believe that the following business model attributes enable us to successfully execute our strategy:

High Quality Fleet

Our ships are consistently ranked among the best in the industry. Our accommodations are large and luxurious with 87% of our staterooms and suites featuring private balconies. Capacity per ship is limited and ranges from 490 to 1,250 guests, providing each guest a unique and highly personalized experience, with space ratios of 44.26 to 68.68, which are among the highest in the industry. Our cruises are staffed at a crew-to-guest ratio of approximately 1 to 1.6, further promoting a high level of personalized service. Seven Seas Mariner and Seven Seas Voyager feature all suite, all balcony accommodations. Marina and Riviera , 95% of whose accommodations feature balconies, feature suites designed and furnished by Ralph Lauren Home and noted interior designer Dakota Jackson. We expect delivery of our newbuild Seven Seas Explorer in the summer of 2016, which we believe will be the most luxurious ocean-going ship ever built .

Differentiated Product Offering

We believe that our destination-focused worldwide itineraries of varying lengths, augmented by exciting shore excursions and other land based programs and a diverse set of onboard enrichment programs, further differentiate our two brands from our competitors. We also focus on deploying our ships to high demand and in-season locations worldwide. We cruise to more remote ports around the world to meet passengers’ demands to experience new, exotic and out-of-the-way destinations. We feature itineraries that call on “must see” destinations, many of which include overnight stays in port, allowing guests to enjoy greater local immersion. A competitive advantage of our

smaller ship size is that we can access smaller ports that are off-limits to larger ships. Our onboard dining is a central highlight of our cruise experience, with multiple open seating dining venues where guests may dine when, where and with whom they wish. We continue to receive awards for our onboard dining and in 2013 received “Best Dining” from Cruise Critic Cruisers Choice Awards. We also feature the only hands-on instructional culinary centers at sea onboard Oceania’s Marina and Riviera . Our spa facilities on each vessel feature the highly renowned Canyon Ranch SpaClub ^® . We believe that these high quality product offerings positions us well compared to other cruise operators and provides us with the opportunity to continue growing our capacity and Net Yields.

Loyal and Repeat Customer Base

Our target customer is 55 years of age or older, has a net worth of over $1.0 million, is well educated and is a seasoned world traveler. The average age of our customers is 65. This target audience has reached an age and wealth status where the convenience, comfort and luxury amenities of an upscale cruise product are extremely appealing.

Our service, itineraries, gourmet cuisine and onboard amenities have resulted in nearly perfect passenger satisfaction ratings. In 2013, approximately 54% of our total guests responded to our customer satisfaction survey, of which 99% of respondents reported that their cruise experience “met or exceeded” their expectations, and 97% reported they will “likely” return. Our ability to consistently deliver a high quality, high value product, resulting in high guest satisfaction, continues to be a competitive advantage.

Experienced Management Team and Shareholder

We are led by a management team with extensive cruise and leisure industry experience. The team includes Frank J. Del Rio as Chairman and CEO with 20 years of industry experience, Robert J. Binder as Vice Chairman and President with 23 years of industry experience, Kunal S. Kamlani as President of PCH, Regent and Oceania with 19 years of experience in the financial services and leisure industries, T. Robin Lindsay as Executive Vice President of Vessel Operations with 34 years of industry experience and Jason M. Montague as Executive Vice President and Chief Financial Officer with 13 years of industry experience.

Cash Flow Generation

Our business model allows us to generate a significant amount of free cash flow with high revenue visibility. We encourage our target customers to book their cruise vacations as early as possible in the sales cycle and to prepay for certain optional services. We begin to sell our inventory up to 21 months prior to sail date, with deposits generally due within seven days of booking and final payment collected 90 to 150 days before sailing. This payment model results in passenger deposits being a source of cash, provides strong visibility into our future revenues and corresponding cash flows and gives us ample time to adjust selling price and sales and marketing initiatives to minimize acquisition costs and maximize Net Yields. Moreover, we benefit from favorable U.S. tax status, as our income is primarily derived from the operation of cruise ships in international waters and is therefore generally exempt from U.S. federal income taxes. As a result of these factors, we generate significant free cash flow, a portion of which can be used for debt reduction and capacity expansion.

Superior Value Proposition

A substantial number of cruise customers purchase large balcony staterooms measuring over 200 square feet in size on cruise lines in the Contemporary and Premium segments. We believe that after factoring in additional onboard spending for items that would be included in our ticket price, these passengers are currently paying per diems similar to what we charge, but in our opinion, receive a lower quality product, with inferior cuisine, standard itinerary offerings, diminished personalized service due to significantly higher crew-to-guest ratios and markedly lower space ratios. According to our research, there are over 23,000 large balcony staterooms measuring over 200 square feet in the North American cruise industry. Our market share of this type of stateroom was approximately 10% in 2013. We believe our brands are well positioned for future capacity growth given each brand’s market position and strong value proposition.

Our Business Strategy

The following are the key components of our business strategy:

Disciplined Growth

Our goal is to grow with discipline, and we are constantly evaluating various strategies for further increasing our passenger capacity and, accordingly, our total revenues and net income with a specific focus on increasing our return on invested capital. These strategies include further penetration into emerging international markets and potential acquisitions of niche cruise operators, similar to the successful acquisition of Regent in 2008. Other possibilities include additional newbuild programs, similar to the additions of Marina and Riviera to the Oceania fleet in 2011 and 2012, respectively, as well as the scheduled delivery of the Seven Seas Explorer to the Regent fleet in the summer of 2016.

High Visibility and Differentiated Revenue Management Strategy

We have implemented a differentiated price enhancing revenue management strategy that encourages our target market to book early to obtain the most attractive value offering, with bookings made up to 21 months in advance of sail date. This timeline provides us with greater visibility into our future revenues and gives us ample time to adjust sales, marketing and pricing initiatives as necessary. Due to the more inclusive nature of our product offerings, a greater percentage of our Net Revenue is comprised of net ticket revenue as compared to Contemporary and Premium segment cruise lines, which must wait until the actual sailing to gain visibility into much of their revenues, as their onboard revenue represents a greater portion of their total revenue. On average, our guests book over seven months in advance of sail date. Based on our research, we believe the industry average booking curve is five months or less.

When we launch new itineraries, we clearly articulate to potential customers and travel agents that prices are subject to increase as the cruise date approaches, as well as the specific dates on which those price increases may occur. We believe the travel agent community favors our pricing strategy as it allows them to provide value to their customers in a completely transparent manner, resulting in early bookings. This early booking cycle allows us to make more informed decisions about pricing, inventory management and marketing efforts.

Focus on Occupancy and Maximize Net Yields

to maximize the revenue potential from each customer contact (“leads”) generated by our various marketing campaigns. We expect that this strategic change and other initiatives in our sales organization and distribution channels will help drive sustainable growth in the number of guests carried and in Net Yields achieved.

Due to our brands’ clear positioning and our target market focus on an older and more affluent clientele, we do not carry many families with children or groups of individuals that travel three or four to a stateroom. Conversely, we have a small but increased number of elderly guests who prefer to travel as “singles,” or one to a stateroom. Because 100% occupancy is based on two persons in a stateroom, we tend to report occupancies that are somewhat lower than those of the Premium and Contemporary cruise lines, while still sailing close to full in terms of cabin occupancy.

Improve Operating Efficiency and Lower Costs

We focus on driving continued financial performance through a variety of business improvement initiatives. These initiatives focus on reducing costs while also improving the overall product quality we deliver to our customers. For example, when we acquired Regent in 2008, we were able to achieve $18 million in annual cost savings through rationalizing overhead and institutionalizing best practices across the two brands.

Our business improvement initiatives focus on various cost containment programs such as contract negotiations, global purchasing and logistics, fuel consumption efficiencies and optimal itinerary deployments. We hedge our fuel purchases in order to provide greater visibility and certainty of our fuel expenses. As of December 31, 2013, we had hedged approximately 50% and 12% of our estimated fuel consumption for 2014 and 2015, respectively. In addition, we expect benefits derived from economies of scale from additional newbuilds will further drive operating efficiencies over the medium and long term.

Expand and Strengthen Our Product Distribution Channels

We have three primary sales channels that we constantly strive to optimize: “Retail/Travel Agent,” “International” and “Meetings, Incentives and Charters.” As part of this optimization, we continue to invest in our brands by enhancing our technology platforms across these channels, including through websites and other global distribution systems, as well as our inbound and outbound reservations department that travel agents and customers use to book cruise vacations. We strive to continually deliver efficient and timely marketing information across multiple technological and legacy type platforms.

•

Retail/Travel Agent . We make substantial investments to facilitate our travel agent partners’ success with improvements in booking technologies, transparent pricing strategies, effective marketing tools, improved communication and cooperative marketing initiatives. We have also implemented automated communication, training and booking tools specifically designed to improve our efficiency with the travel agency community and our guests including aggressive call center quality monitoring. We have sales force teams dedicated to each of our two brands who work closely with our travel agency partners on maximizing their marketing and sales effectiveness through product training, education and the sharing of “best-practices.”

•

International . We have an international sales office in Southampton, United Kingdom that services Europe and various general sales agents covering Latin America, Australia and Asia. Since the expansion of our fleet in 2011, we have made a concerted effort to diversify the sourcing of our passengers worldwide. In 2011, 27.5% of Passenger Days Sold were sourced from outside the United States. This percentage has steadily increased as a result of our diversification efforts, and for the year ended December 31, 2013, 33.2% of Passenger Days Sold were sourced from outside the United States. We believe there remains significant opportunity to grow passenger sourcing in many major markets such as Europe and Australia as well as in emerging markets in the Asia Pacific region.

•

Meetings, Incentives and Charters . This channel focuses on full ship charters as well as partial ship groups for corporate meeting and incentive travel. These sales often have very long lead times and can fill a significant portion of a ship’s capacity, or even an entire sailing, in one transaction. In addition, full ship charters and/or large groups strengthens base-loading, which allows us to fill a particular sailing earlier than usual which in turn allows us to reduce sales and marketing spend on both the sailing with the large group as well as surrounding sailings.

Our Fleet

Collectively, our two brands operate eight ships with 6,442 berths in aggregate. We also have one newbuild, Seven Seas Explorer , with 750 berths on order for delivery in the summer of 2016. Our current fleet has a maximum of 2,351,330 capacity days that will grow 11.6% to 2,625,080 after delivery of the Seven Seas Explorer in the summer of 2016.

Oceania operates five ships. The R-Class ships, Regatta , Insignia and Nautica are identical highly-rated 5-star ships featuring country club style accommodations and amenities. Capacity on each ship is limited to 684 guests and our cruises are staffed at a crew-to-guest ratio of approximately 1 to 1.7. These ships provide 68% of suites and staterooms with private balconies. Recently, Oceania successfully executed a fleet expansion program with the additions of two O-Class ships, Marina and Riviera , in 2011 and 2012, respectively. The O-Class vessels are staffed at a crew-to-guest ratio of approximately 1 to 1.6 and 95% of the staterooms are suites and have private balconies. Oceania’s fleet has grown 122% since 2010 to 4,552 berths in aggregate and operating a maximum annual capacity of 1,661,480 capacity days. Oceania is the world’s largest Upper Premium cruise line.

Regent currently operates three six-star luxury cruise ships, Seven Seas Navigator, Seven Seas Mariner and Seven Seas Voyager , with 1,890 berths in aggregate , featuring world-class accommodations and amenities. Regent operates at a maximum capacity of 689,850 capacity days. Capacity on each ship is limited and ranges from 490 to 700 guests and cruises are staffed at a crew-to-guest ratio of approximately 1 to 1.5. All ships offer all-suite accommodations with 90-100% of the suites featuring private balconies. Delivery of the 750 guest newbuild, Seven Seas Explorer, is expected in the summer of 2016. The all-suite, all-balcony Seven Seas Explorer will feature sophisticated designer suites ranging from 300 square feet to 3,500 square feet with an industry leading space ratio of 76.0 and a crew-to-guest ratio of 1 to 1.4. The ship will include six open-seating gourmet restaurants, Regent’s signature nine-deck open atrium, a two-story theater, two boutiques and an expansive Canyon Ranch SpaClub ^® . Upon delivery of the Seven Seas Explorer , Regent will be the world’s largest luxury cruise line.

The average age of our combined fleet is 11 years as compared to the Upscale segment, which has an average age of 14 years, and the Contemporary/Premium segment, which has an average age of 11 years. The following table describes the features of our ships:


	Marina, Riviera	Regatta, Insignia, Nautica	Seven Seas Explorer	Seven Seas Voyager	Seven Seas Mariner	Seven Seas Navigator
Berths	1,250	684	750	700	700	490
Balconies	95%	68%	100%	100%	100%	90%
Gross tonnage	66,084	30,277	57,000	42,363	48,075	28,803
Space ratio (1)	52.86	44.26	76.00	60.52	68.68	58.78
Accommodations (sq ft)	174-2,000	160-982	300-3,500	350-1,403	301-2,002	301-1,173
Crew-to-guest ratio	1:1.6	1:1.7	1:1.4	1:1.6	1:1.6	1:1.4
Country of registry	Marshall Islands	Marshall Islands	Marshall Islands	Bahamas	Bahamas	Bahamas
Restaurants	6	4	6	4	4	3
Year built	2011, 2012	1998, 1998, 2000	(2)	2003	2001	1999

(1)	Space ratio refers to a unit of enclosed space per passenger on the ship measured in cubic feet, and represents gross tonnage divided by the number of double occupancy berths.

(2)	The Seven Seas Explorer is currently under construction, with delivery expected in the summer of 2016.

Our Corporate Structure

The following chart shows our corporate structure immediately following the consummation of this offering:

LOGO

Our Sponsor

Our principal shareholders are funds affiliated with Apollo Global Management, LLC, which manages the funds, and which we refer to collectively as our sponsor. Apollo is a leading global alternative asset manager with offices in New York, Los Angeles, London, Frankfurt, Luxembourg, Singapore, Hong Kong and Mumbai. As of December 31, 2013, Apollo had assets under management of $161.0 billion invested in its private equity, credit markets and real estate businesses. In addition to holding a controlling interest in us, Apollo is a significant shareholder and controls the board of Norwegian Cruise Line Holdings Ltd., one of the leading global cruise line operators. Apollo also has current investments in other travel and leisure companies, including Caesars Entertainment and Great Wolf Resorts, and has in the past invested in Vail Resorts, Wyndham International and other hotel properties.

Additional Information

Prestige is a company incorporated under the laws of Panama. Our registered offices are located at Plaza 2000 Building, 16 ^th Floor, 50 ^th Street, Panama, Republic of Panama. Our principal executive offices are located at 8300 NW 33 ^rd Street, Suite 100, Miami, FL 33122. Our telephone number is (305) 514-2300. Our websites are www.rssc.com and www.oceaniacruises.com. The information that appears on our website is not part of, and is not incorporated by reference into, this prospectus.

THE OFFERING

Issuer

Prestige Cruises International, Inc.

Common stock offered by us

shares, or shares if the underwriters exercise in full their option to purchase additional shares.

Common stock to be outstanding after this offering

shares, or shares if the underwriters exercise in full their option to purchase additional shares.

Over-allotment option

We have granted the underwriters an option for a period of 30 days to purchase from us of up to additional shares of common stock to cover any over-allotments.

Use of proceeds

We estimate that we will receive net proceeds from the sale of our common stock in this offering of approximately $ million, after deducting the underwriting discount and estimated offering expenses, assuming the shares of common stock are offered at $ per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, and assuming that the underwriters do not exercise their option to purchase additional shares. We intend to use the net proceeds that we receive (i) to redeem $ million of Regent’s outstanding Senior Secured Notes, (ii) to repay $ million of the Oceania Term Loan and $ million of the Regent Term Loan, and (iii) for future capital expenditures and general corporate purposes. See “Use of Proceeds.”

Listing

We have applied to list the common stock on under the symbol “ .”

Dividend policy

We currently do not intend to pay dividends following this offering. The agreements governing our debt instruments limit our ability to pay cash dividends to our shareholders above specified levels. In addition, any determination to pay dividends in the future will be at the discretion of our Board of Directors and will depend upon our results of operations, financial condition, contractual restrictions, restrictions imposed by applicable law and other factors that our Board of Directors deems relevant. See “Dividend Policy.”

Risk factors

You should carefully read and consider the information set forth under “Risk Factors” beginning on page 19 of this prospectus and all other information set forth in this prospectus before investing in our common stock.

The number of shares of common stock to be outstanding after this offering is based on shares of common stock outstanding as of the date of this prospectus and the shares of common stock we are offering. This number of shares excludes shares of common stock issuable upon the exercise of outstanding options at a weighted-average exercise price of $ per share as of the date of this prospectus, of which were exercisable, and up to shares of common stock reserved for future issuance

under our equity incentive plans following this offering. The number of shares of common stock reserved for future issuance will be reduced by options to purchase shares of common stock that we granted effective immediately following the pricing of this offering with an exercise price equal to the initial public offering price. Of these grants, our directors and named executive officers received options to purchase shares of common stock.

Except as otherwise indicated herein, all information in this prospectus, including the number of shares of common stock that will be outstanding after this offering, reflects or assumes:

•

an initial public offering price of $ per share of common stock;

•

the underwriters do not exercise their option to purchase up to additional shares of common stock from us;

•

the stock split that we intend to effectuate prior to this offering, whereby each issued and outstanding share of common stock will be converted into shares; and

•

no exercise of the outstanding options described above.

SUMMARY CONSOLIDATED FINANCIAL INFORMATION

In the tables below, the summary consolidated financial information as of December 31, 2013 and 2012, and for each of the three years ended December 31, 2013, 2012 and 2011 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary consolidated financial information as of December 31, 2011 has been derived from our audited consolidated financial statements not included in this prospectus.

We utilize a variety of operational and financial metrics, which are defined below, to evaluate our performance and financial condition. We use certain non-GAAP financial measures, such as EBITDA, Adjusted EBITDA, Net Per Diems and Net Yields, to enable us to analyze our performance and financial condition. We utilize these financial measures to manage our business on a day-to-day basis and believe that they are the most relevant measures of our performance. Some of these measures are commonly used in the cruise industry to measure performance. We believe these non-GAAP measures provide expanded insight to measure revenue and cost performance, in addition to the standard GAAP-based financial measures. There are no specific rules or regulations for determining non-GAAP measures, and as such, they may not be comparable to measures used by other companies within our industry. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We have substantial indebtedness. See “Description of Certain Indebtedness” and “Risks Related to Our Business—Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from making debt service payments,” “Risks Related to Our Business—We may not be able to generate sufficient cash to service all of our indebtedness, and we may be forced to take other actions to satisfy our obligations under our indebtedness that may not be successful” and “Risks Related to Our Business—The agreements governing our indebtedness contain restrictions that will limit our flexibility in operating our business.”

The historical results set forth below do not necessarily indicate results expected for any future period, and should be read in conjunction with “Risk Factors,” “Selected Consolidated Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Certain Indebtedness” and our consolidated financial statements and related notes thereto included elsewhere in this prospectus.


(in thousands, except per share data)	Years Ended December 31,
(in thousands, except per share data)	2013			2012			2011
Statement of Operating Data:
Revenues
Passenger ticket	$	1,001,610		$	947,071		$	834,868
Onboard and other		162,947			151,213			134,270
Charter		18,779			13,737			—

Total revenue		1,183,336			1,112,021			969,138
Expenses
Cruise operating expenses
Commissions, transportation and other		323,841			331,254			271,527
Onboard and other		43,518			40,418			36,854
Payroll, related and food		177,953			168,594			153,754
Fuel		101,690			101,685			92,921
Other ship operating		98,062			95,808			86,022
Other		16,416			21,968			26,305

Total cruise operating expenses		761,480			759,727			667,383
Selling and administrative		174,866			153,747			145,802
Depreciation and amortization		83,829			93,003			79,269

Total operating expenses		1,020,175			1,006,477			892,454

Operating income		163,161			105,544			76,684

Non-operating income (expense)
Interest expense, net of capitalized interest		(141,634	)		(131,651	)		(101,560	)
Interest income		540			752			670
Other income (expense) (1)		13,209			22,956			(45,901	)

Total non-operating expense		(127,885	)		(107,943	)		(146,791	)

Income (loss) before income taxes		35,276			(2,399	)		(70,107	)
Income tax benefit (expense)		246			(213	)		335

Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)

Earnings (loss) per share
Basic	$	2.62		$	(0.19	)	$	(5.14	)

Diluted	$	1.88		$	(0.19	)	$	(5.14	)

Unaudited pro forma earnings per share
Basic

Diluted


(in thousands, except for operating data:	As of and for the year ended December 31,
(in thousands, except for operating data:	2013			2012			2011
Balance sheet data (at end of period):
Cash and cash equivalents	$	286,419		$	139,556		$	147,212
Restricted cash (2)		43,401			63,692			58,168
Property and equipment, net		2,012,710			2,035,449			1,644,971
Total assets		2,989,886			2,872,110			2,479,581
Passenger deposits (2)		432,564			365,296			336,203
Long-term debt (3)		1,596,218			1,695,656			1,328,518
Total debt (3)		1,686,544			1,713,216			1,350,840
Related party notes payable		711,617			661,304			615,143
Total liabilities		2,962,304			2,885,453			2,489,409
Total stockholders’ equity (deficit)		27,582			(13,343	)		(9,828	)
Cash flow data:
Net cash provided by operating activities		230,724			188,068			186,317
Net cash used in investing activities		(33,086	)		(539,501	)		(603,733	)
Net cash (used in) provided by financing activities		(50,743	)		343,621			447,193
Operating data:
Passenger Days Sold (4)		1,978,998			1,873,691			1,688,958
Available Passenger Cruise Days (5)		2,094,670			1,985,522			1,836,722
Occupancy (6)		94.5	%		94.4	%		92.0	%
Net Per Diem (7)	$	402.83		$	387.80		$	391.22
Gross Yield (8)		555.96			553.15			527.65
Net Yield (9)		380.58			365.96			359.75
Adjusted EBITDA (10)		255,798			227,337			182,196
Capital Expenditures		53,420			478,962			535,531

(1)	Other income (expense) consists of a variety of non-operating items including but not limited to foreign transaction gains and losses, gain (loss) on early extinguishment of debt and realized and unrealized gain (loss) on derivative instruments.

(2)	Total restricted cash represents reserve requirements for credit card and vendor agreements. Total passenger deposits represent cash collected in advance for future cruises.

(3)	Includes the debt discount of $29.7 million and $32.8 million as of December 31, 2013 and 2012, respectively.

(4)	Passenger Days Sold refers to the number of revenue passengers carried for the period multiplied by the number of days within the period in their respective cruises.

(5)

Available Passenger Cruise Days (“APCD”) is our measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period. We use this measure to perform capacity and rate analysis to identify our main non-capacity drivers which cause our cruise revenue and expense to vary.

(6)	Occupancy is calculated by dividing Passenger Days Sold by APCD.

(7)	Net Per Diem represents Net Revenue divided by Passenger Days Sold.

(8)	Gross Yield refers to total revenue, excluding charter per APCD.

(9)	Net Yield refers to Net Revenue per APCD.

We utilize Net Revenue, Net Per Diem and Net Yield to manage our business on a day-to-day basis and believe that they are the most relevant measures of our revenue performance because they reflect the revenue earned by us net of significant variable costs. The table below illustrates the calculation of Net Revenue, Net Per Diem, Gross Yield and Net Yield.


(in thousands, except Passenger Days Sold, Available Passenger Cruise Days, Net Per Diem, and Yield data)	Year Ended December 31,
	2013		2012		2011
Passenger ticket revenue	$	1,001,610	$	947,071	$	834,868
Onboard and other revenue		162,947		151,213		134,270

Total revenue, excluding charter		1,164,557		1,098,284		969,138
Less:
Commissions, transportation and other expense		323,841		331,254		271,527
Onboard and other expense		43,518		40,418		36,854

Net Revenue	$	797,198	$	726,612	$	660,757

Passenger Days Sold		1,978,998		1,873,691		1,688,958
Available Passenger Cruise Days		2,094,670		1,985,522		1,836,722
Net Per Diem	$	402.83	$	387.80	$	391.22
Gross Yield		555.96		553.15		527.65
Net Yield		380.58		365.96		359.75

(10)

Adjusted EBITDA refers to net income (loss) excluding depreciation and amortization, interest income, interest expense, other income (expense), and income tax benefit (expense), and other supplemental adjustments in connection with the calculation of certain financial ratios permitted in calculating covenant compliance under the indenture governing the Senior Secured Notes (as defined herein) and our Secured Credit Facilities (as defined herein).

We believe EBITDA and Adjusted EBITDA can provide a more complete understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. EBITDA is defined as net income (loss) excluding depreciation and amortization, net interest expense and income tax benefit (expense). This non-GAAP financial measure has certain material limitations, including:

•

It does not include net interest expense. As we have borrowed money for general corporate purposes, interest expense is a necessary element of our costs and ability to generate profits and cash flows; and

•

It does not include depreciation and amortization expense. As we use capital assets, depreciation and amortization are necessary elements of our costs and ability to generate profits and cash flows.

We believe Adjusted EBITDA, when considered along with other performance measures, is a useful measure as it reflects certain operating drivers of our business, such as sales growth, operating costs, selling and administrative expense, and other operating income and expense.

While Adjusted EBITDA is not a recognized measure under GAAP, management uses this financial measure to evaluate and forecast our business performance. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not take into account certain requirements such as capital expenditures and related depreciation, principal and interest payments, and tax payments, and it is subject to certain additional adjustments as permitted under the agreements governing our indebtedness. Our use of Adjusted EBITDA may not be comparable to other companies within our industry. Management compensates for these limitations by using Adjusted EBITDA as only one of several measures for evaluating our business performance. In addition, capital expenditures, which impact depreciation and amortization, interest expense, and income tax benefit (expense), are reviewed separately by management.

The following table provides a reconciliation of net income (loss) to Adjusted EBITDA:


	Year Ended December 31,
(in thousands)	2013			2012			2011
Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)
Interest income		(540	)		(752	)		(670	)
Interest expense, net of capitalized interest		141,634			131,651			101,560
Depreciation and amortization		83,829			93,003			79,269
Income tax (benefit) expense, net		(246	)		213			(335	)

		260,199			221,503			110,052
Other (income) expense		(13,209	)		(22,956	)		45,901
Equity-based compensation/transactions (a)		1,371			2,129			2,153
Fuel hedge gain (b)		814			4,792			10,553
Loss on disposal (c)		146			771			1,174
Newbuild (d)		—			11,088			4,051
Other addback expenses per credit agreement (e)		6,477			10,010			8,312

ADJUSTED EBITDA	$	255,798		$	227,337		$	182,196

(a)

Equity-based compensation/transactions represent stock compensation expense in each period.

(b)

Fuel hedge gain represents the realized gain on fuel hedges triggered by the settlement of the hedge instrument and is included in other income (expense).

(c)

Loss on disposal primarily represents asset write-offs during vessel drydocks.

(d)

Newbuild represents costs incurred specific to new ships that we have contracted to build.

(e)

Other addback expenses per credit agreement represents the net impact of time out of service as a result of unplanned repairs to vessels; expenses associated with consolidating corporate headquarters; certain professional fees and other costs associated with raising capital through debt and equity offerings; certain litigation fees; restructuring fees representing expenses associated with personnel changes, lease termination; management fees paid to Apollo per our management agreement; and other corporate reorganizations to improve efficiencies. In February 2011, Regent amended the Regent license agreement to perpetually license the “Regent” name; as such it will not incur any future license fees.

RISK FACTORS

An investment in our common stock involves a high degree of risk. In addition to the other information in this prospectus, you should carefully consider the following risk factors and the cautionary statement referred to under “Cautionary Statement Regarding Forward-Looking Statements” in evaluating us and our business before purchasing our common stock. If any of the risks discussed in this prospectus materialize, our business, financial condition and results of operations could be materially adversely affected. If this were to occur, the value of our common stock could decline and you may lose all or part of your investment.

Risks Related to Our Business

Adverse economic conditions in North America and throughout the world and related factors such as fluctuating or increasing fuel prices, declines in the securities and real estate markets, and perceptions of these conditions could decrease the level of disposable income of consumers or consumer confidence and adversely affect our financial condition and results of operations.

We have a high concentration of passengers sourced from North America, comprising 78% and 83% of our total Passenger Days Sold for the years ended December 31, 2013 and 2012, respectively. Adverse changes in the perceived or actual economic climate in North America or globally, such as higher fuel prices, stock and real estate market declines and/or volatility, more restrictive credit markets, higher unemployment and underemployment rates, higher taxes and changes in governmental policies, could reduce consumers’ discretionary income or consumer confidence. Consequently, this may negatively affect demand for cruise vacations in North America and worldwide, which are a discretionary purchase. For example, the recent economic downturn reduced consumer confidence and discretionary spending and negatively impacted consumer demand for cruise vacations. Our revenues from passenger ticket sales were accordingly affected during this period, decreasing from approximately $599.0 million in 2008 to approximately $529.6 million in 2009. Decreases in demand could result in price discounting which, in turn, could reduce the profitability of our business. In addition, these conditions could also impact our suppliers, which could result in disruptions in our suppliers’ services and financial losses for us.

An increase in the supply of cruise ships without a corresponding increase in passenger demand could adversely affect our financial condition and results of operations.

Historically, cruise capacity has grown to meet the growth in demand. According to CLIA, North American cruise passenger capacity included 228 ships, with approximately 346,000 berths expected at the end of 2013. Upscale cruise companies account for 25 of the 228 ships and 4.0% of total berths. In order to profitably utilize this capacity, the North American cruise industry will need to increase the portion of the U.S. population that has cruised at least once, which according to CLIA was approximately 24% in 2011, with 11% cruising within the last three years. If there is an industry-wide increase in capacity without a corresponding increase in public demand, we, as well as the entire cruise industry, could experience reduced occupancy rates and/or be forced to discount our prices, which could adversely affect our financial condition and results of operations.

We face intense competition from other cruise companies as well as non-cruise vacation alternatives, and we may not be able to compete effectively, which could adversely affect our financial condition and results of operations.

We face intense competition from other cruise companies, particularly in North America, where the cruise market is mature and developed. The North American cruise industry is highly concentrated among three companies. As of December 31, 2013, Carnival Corporation, Royal Caribbean Cruises Ltd. and Norwegian Cruise Line Holdings Ltd. together account for 82% of North American cruise passenger berth capacity. We compete against these operators principally on the quality of our ships, our differentiated product offering, selection of our itineraries and value proposition of our cruises. In addition, Carnival Corporation and Royal Caribbean Cruises Ltd. have multiple brands with various price points and ships deployed in numerous geographic regions. In addition to their increased scale and diversification, they may have greater financial,

technological, sales and marketing resources than we do. We also face competition for many itineraries from other cruise operators as well as competition from non-cruise vacation alternatives. In the event we do not compete effectively, our financial condition and results of operations could be adversely affected.

Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from making debt service payments.

We are highly leveraged with a high level of floating rate debt, and our level of indebtedness could limit cash flow available for our operations and could adversely affect our financial condition, prospects and flexibility. As of December 31, 2013, we had $2,577.6 million of total debt, which consisted of $895.7 million under term loan facilities used to finance the Marina and Rivera newbuilds, $299.3 million under Oceania’s Term Loan, $296.3 million under the Regent Term Loan (as defined herein), $225.0 million of outstanding Senior Secured Notes and $861.3 million of related party debt. In addition, as of December 31, 2013, Regent and Oceania had $40.0 million and $75.0 million, respectively, in available borrowings under their respective revolving credit facilities and approximately $440 million in available borrowings under our loan agreement to finance the construction of the Seven Seas Explorer . Our related party debt will be capitalized prior to the consummation of this offering. See “Unaudited Pro Forma Consolidated Financial Data.”

Our substantial indebtedness could:

•

limit our ability to borrow money for working capital, capital expenditures, development projects, debt service requirements, strategic initiatives or other purposes;

•

make it more difficult for us to satisfy our obligations with respect to our indebtedness, and any failure to comply with the obligations of any of our debt instruments, including restrictive covenants and borrowing conditions, could result in an event of default under the agreements governing our indebtedness;

•

require us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our outstanding debt, thereby reducing funds available to us for other purposes;

•

limit our flexibility in planning for, or reacting to, changes in our operations or business;

•

make us more highly leveraged than some of our competitors, which may place us at a competitive disadvantage;

•

make us more vulnerable to downturns in our business or the economy and in the industry in which we operate;

•

limit our ability to make strategic acquisitions or exploit business opportunities;

•

limit our ability to borrow additional funds or dispose of assets, among other financial and restrictive covenants in the agreements governing our indebtedness; and

•

make our credit card processors seek more restrictive terms in respect of our credit card arrangements.

Any of the factors listed above could materially and adversely affect our business and our results of operations. Furthermore, our interest expense could increase if interest rates rise, since certain portions of our debt bear interest at floating rates. If we do not have sufficient cash flows to service our debt, we may be required to refinance all or part of our existing debt, sell assets, borrow more money or sell securities, none of which we can guarantee we will be able to do.

We may be able to incur significant additional indebtedness in the future. Although the agreements governing our indebtedness contain limitations on the incurrence of certain additional indebtedness, these limitations are subject to a number of important qualifications and exceptions, and the indebtedness incurred in compliance with these limitations could be substantial. If we incur new indebtedness, the related risks, including those described above, could intensify.

We may not be able to generate sufficient cash to service all of our indebtedness, and we may be forced to take other actions to satisfy our obligations under our indebtedness that may not be successful.

Our ability to satisfy our debt obligations will depend upon, among other things:

•

our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other factors, many of which are beyond our control; and

•

our ability to borrow additional debt or to access available borrowings under our Secured Credit Facilities, the availability of which depends on, among other things, our compliance with the covenants in Regent’s Senior Secured Notes and our Secured Credit Facilities.

We cannot assure you that our business will generate sufficient cash flows from operations, or that we will be able to access available borrowings under our Secured Credit Facilities or otherwise in an amount sufficient to fund our liquidity needs. If our cash flows and capital resources are insufficient to service our indebtedness, we may be forced to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance our indebtedness. Our ability to restructure or refinance our indebtedness will depend upon numerous factors, including but not limited to the condition of the capital markets, our financial condition at such time, credit ratings and the performance of our industry in general. Any refinancing of our indebtedness could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. In the absence of operating results or resources sufficient to service our indebtedness, we could also face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Some or all of our assets may be illiquid and may have no readily ascertainable market value, however, and we may not be able to consummate such dispositions for fair market value or at all. Furthermore, any proceeds that we could realize from any such dispositions may not be adequate to meet our debt service obligations when due. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations. In addition, the terms of existing or future debt agreements may restrict us from adopting some of these alternatives.

The agreements governing our indebtedness contain restrictions that will limit our flexibility in operating our business.

The agreements governing our indebtedness contain, and any instruments governing future indebtedness of ours would likely contain, a number of covenants that impose operating and financial restrictions on us. For example, our loan agreements to finance our newbuild vessels requires that we maintain a minimum liquidity balance, a maximum total debt to EBITDA ratio, a minimum EBITDA to debt service ratio and a maximum total debt to total adjusted equity ratio requirements, and our Secured Credit Facilities require that we maintain a maximum loan-to-value ratio, a minimum interest coverage ratio (applicable only to revolving credit facilities if drawn) and restrictions under Regent’s Senior Secured Notes and our Secured Credit Facilities on our and our subsidiaries’ ability to, among other things:

•

incur or guarantee additional indebtedness or issue preferred stock;

•

grant liens on assets;

•

pay dividends or make distributions to our shareholders;

•

repurchase or redeem capital stock or subordinated indebtedness;

•

make investments or acquisitions;

•

restrict the ability of our subsidiaries to pay dividends or to make other payments to us;

•

enter into transactions with our affiliates;

•

merge or consolidate with other companies or transfer all or substantially all of our assets;

•

transfer or sell assets;

•

pledge the capital stock issued by the guarantors of our indebtedness; and

•

designate our subsidiaries as unrestricted subsidiaries.

In addition, our ability to meet those financial covenants can be affected by events beyond our control, and there can be no assurance that we will meet those covenants. A failure to comply with these financial covenants could result in an event of default under the facilities or the existing agreements, which, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations. In the event of any default under Regent’s Senior Secured Notes and our Secured Credit Facilities or our other indebtedness, the holders of our indebtedness thereunder:

•

will not be required to lend any additional amounts to us, if applicable;

•

could, in certain circumstances, elect to declare all indebtedness outstanding, together with accrued and unpaid interest and fees, to be due and payable and terminate all commitments to extend further credit, if applicable; or

•

could require us to apply all of our available cash to repay such indebtedness.

Additionally, under the terms of the agreements governing our indebtedness, certain holders could bring actions against us that would cause cross defaults under our other indebtedness. If we were unable to repay those amounts, the holders of our indebtedness under Regent’s Senior Secured Notes and our Secured Credit Facilities or our other indebtedness could proceed against the collateral granted to them to secure that indebtedness, which includes certain of our cruise ships, depending on the facility. As a result of these restrictions, we would be limited in the manner in which we conduct our business, and we may be unable to engage in favorable business activities or finance future operations or capital needs.

The impact of disruptions in the global credit markets may adversely affect our ability to borrow and could increase our counterparty credit risks, including those under our Secured Credit Facilities, derivative instruments, contingent obligations and insurance contracts.

There can be no assurance that we will be able to borrow additional money on terms as favorable as our current debt, on commercially acceptable terms, or at all.

Economic downturns, including failures of financial institutions and any related liquidity crisis, can disrupt the capital and credit markets. Such disruptions could cause counterparties under our Secured Credit Facilities, derivative instruments, contingent obligations and insurance contracts to be unable to perform their obligations or to breach their obligations to us under our contracts with them, or result in failures of financial institutions to fund required borrowings under our Secured Credit Facilities and to pay us amounts that may become due under our derivative contracts and other agreements. We could also be limited in obtaining funds to pay amounts due to our counterparties under our derivative contracts and to pay amounts that may become due under other agreements. If we were to elect to replace any counterparty for its failure to perform its obligations under such instruments, we would likely incur significant costs to replace the counterparty. Any failure to replace any counterparties under these circumstances, however, may result in additional costs to us.

Increases in fuel prices or other cruise operating costs could have an adverse impact on our financial condition and results of operations.

Fuel costs accounted for 13.4% of our total cruise operating expenses for both the years ended December 31, 2013 and 2012, respectively, as compared to 13.9% for the year ended December 31, 2011. Economic, market and political conditions in certain parts of the world make it challenging to predict the future prices and availability of fuel. Future increases in fuel prices would increase our cost of cruise ship operations. We could also experience increases in other cruise operating costs, such as food, crew, port, repairs and maintenance, insurance and security costs, due to market forces and economic or political instability beyond our control. Despite any fuel hedges we are currently a party to or may enter into in the future, increases in fuel prices or other cruise operating costs could have a material adverse effect on our financial condition and results of operations if we are unable to recover these increased costs through price increases charged to our guests. Conversely, significant declines in fuel prices could result in margin calls under certain of our fuel hedges,

which could create a short-term liquidity risk. While we anticipate that the costs of any such margin calls would be recouped over time as a result of lower fuel costs, any such margin calls may affect our ability to comply with the covenant obligations under Regent’s Senior Secured Notes and our Secured Credit Facilities.

Our business and results of operations are dependent on our fleet of cruise ships. The loss of any ship for an extended period of time could have a proportionately large impact on our financial position.

Our fleet consists of eight cruise ships. Accordingly, we are more dependent on the successful operations of any one of our individual cruise ships than some of our competitors with larger fleets. If any one of our eight cruise ships were to cease operations for an extended period of time, for example due to an extended drydock or maintenance concerns, our financial position and results of operations could be negatively and proportionately impacted.

Conducting business internationally may result in increased costs and risks.

We operate our business internationally and plan to continue to develop our international presence. Operating internationally exposes us to a number of risks, including political risks, risks of increases in duties and taxes, risks relating to anti-bribery laws, as well as risks that laws and policies affecting cruising, vacation or maritime businesses, or governing the operations of foreign-based companies may change. Additional risks include interest rate movements, imposition of trade barriers, restrictions on repatriation of earnings, withholding and other taxes on remittances and other payments by subsidiaries, and changes in and application of foreign taxation structures, including value added taxes. Furthermore, we operate in waters and call at ports that have experienced political and civil unrest, insurrection and armed hostilities. If we are unable to address these risks adequately, our financial condition and results of operations could be adversely affected.

Operating internationally also exposes us to numerous and sometimes conflicting legal and regulatory requirements. In many parts of the world, including countries in which we operate, practices in the local business communities might not conform to international business standards. We must adhere to policies designed to promote legal and regulatory compliance as well as applicable laws and regulations. However, we might not be successful in ensuring that our employees, agents, representatives and other third parties with which we associate throughout the world properly adhere to them. Failure by us, our employees or any of these third parties to adhere to our policies or applicable laws or regulations could result in penalties, sanctions, damage to our reputation and related costs, which in turn could negatively affect our results of operations and cash flows.

Our efforts to expand our business into new markets may not be successful.

While our historical focus has been to serve the North American cruise market, we are expanding our focus to increase our international guest sourcing. Since the expansion of our fleet in 2011, we have made a concerted effort to diversify the sourcing of our passengers worldwide. In 2011, 27.5% of Passenger Days Sold were sourced from outside the United States, and for the year ended December 31, 2013, 33.2% of Passenger Days Sold were sourced from outside the United States. We believe there remains significant opportunity to expand our passenger sourcing into major markets such as Europe and Australia, as well as into emerging markets in the Asia Pacific region. Expansion into new markets requires significant levels of investment. There can be no assurance that these markets will develop as anticipated or that we will have success in these markets, and if we do not, we may be unable to recover our investment spent to expand our business into these markets, which could adversely impact our business, financial condition and results of operations.

Fluctuations in foreign currency exchange rates could affect our financial results.

We have historically and may in the future enter into ship construction contracts denominated in euros. While we have entered into foreign currency swaps and collar options to manage a portion of the currency risk associated with such contracts, we are exposed to fluctuations in the euro exchange rate for the portions of the ship construction contracts that have not been hedged. Additionally, if the shipyard is unable to perform under

the related ship construction contract, any foreign currency hedges that were entered into to manage the currency risk would need to be terminated. Termination of these contracts could result in a significant loss and adversely affect our results of operations.

Delays in our shipbuilding program and ship repairs, maintenance and refurbishments could adversely affect our results of operations and financial condition.

The new construction, refurbishment, repair and maintenance of our cruise ships are complex processes and involve risks similar to those encountered in other large and sophisticated equipment construction, refurbishment and repair projects. Our ships are subject to the risk of mechanical failure or accident, which we have occasionally experienced and have had to repair. If there is a mechanical failure or accident in the future, we may be unable to procure spare parts when needed or make repairs without incurring material expense or suspension of service, especially if a problem affects certain specialized maritime equipment, such as the radar, a pod propulsion unit, the electrical/power management system, the steering gear or the gyro system.

In addition, availability, work stoppages, insolvency or financial problems in the shipyards’ construction, refurbishment or repair of our ships, or other “force majeure” events that are beyond our control and the control of shipyards or subcontractors, could also delay or prevent the newbuild delivery, refurbishment, repair and maintenance of our ships. Any termination or breach of contract following such an event may result in, among other things, the forfeiture of prior deposits or payments made by us, potential claims and impairment of losses. A significant delay in the delivery of a new ship, or a significant performance deficiency or mechanical failure of a new ship could also have an adverse effect on our business. The consolidation of the control of certain European cruise shipyards could result in higher prices for refurbishment and repairs due to reduced competition. Also, the lack of qualified shipyard repair facilities could result in the inability to repair and maintain our ships on a timely basis. These potential events and the associated losses, to the extent that they are not adequately covered by contractual remedies or insurance, could adversely affect our results of operations and financial condition.

We rely on external distribution channels for passenger bookings. Major changes in the availability of external distribution channels could undermine our customer base.

The majority of our passengers book their cruises through independent travel agents, wholesalers and tour operators. In the event that the travel agent distribution channel is adversely impacted by an economic downturn, this could reduce the distribution channels available for us to market and sell our cruises and we could be forced to use alternative distribution channels we are not accustomed to. If this were to occur, it could have an adverse impact on our financial condition and results of operations.

Additionally, independent travel agents, wholesalers and tour operators generally sell and market our cruises on a non-exclusive basis. Although we offer commissions and other incentives to them for booking our cruises, there can be no guarantee that our competitors will not offer higher commissions and incentives in the future. Travel agents may face increasing pressure from our competitors, particularly in the North American market, to sell and market our competitors’ cruises exclusively. If such exclusive arrangements were introduced, there can be no assurances that we will be able to find alternative distribution channels to ensure that our customer base would not be affected.

We rely on third parties to provide hotel management services for our vessels and certain other services, and we are exposed to risks facing such providers. In certain circumstances, we may not be able to replace such third parties or we may be forced to replace them at an increased cost to us.

We rely on external third parties to provide hotel management services for our vessels and certain other services that are vital to our business. If these service providers suffer financial hardship or are otherwise unable to continue providing such services, we cannot guarantee that we will be able to replace such service providers in a timely manner, which may cause an interruption in our operations. To the extent that we are able to replace

such service providers, we may be forced to pay an increased cost for equivalent services. Both the interruption of operations and the replacement of the third-party service providers at an increased cost could adversely impact our financial condition and results of operations.

We rely on scheduled commercial airline services for passenger and crew connections. Increases in the price of, or major changes or reduction in, commercial airline services could undermine our customer base or disrupt our operations.

A number of our passengers and crew depend on scheduled commercial airline services to transport them to ports of embarkation for our cruises. Increases in the price of airfare due to increases in fuel prices, fuel surcharges, changes in commercial airline services as a result of strikes, weather or other events, or the lack of availability due to schedule changes or a high level of airline bookings could adversely affect our ability to deliver guests and crew to or from our cruise ships and thereby increase our cruise operating expenses which would, in turn, have an adverse effect on our financial condition and results of operations.

Acts of terrorism, acts of piracy, armed conflict and threats thereof, and other international events impacting the security of travel could adversely affect the demand for cruises and as a result adversely affect our financial condition and results of operations.

Past acts of terrorism and piracy have had an adverse effect on tourism, travel and the availability of air service and other forms of transportation. The threat or possibility of future terrorist acts, an increase in or outbreak of additional hostilities or armed conflict abroad or the possibility thereof, an increase in the activity of pirates operating off the western coast of Africa or elsewhere, political unrest and instability, the issuance of government travel advisories, and other geopolitical uncertainties have had in the past and may again in the future have an adverse impact on the demand for cruises and consequently the pricing for cruises. Decreases in demand and reduced pricing in response to such decreased demand would adversely affect our financial condition and results of operations by reducing our profitability.

Our revenues are seasonal, owing to variations in passenger fare rates and occupancy levels at different times of the year. We may not be able to generate revenues that are sufficient to cover our expenses during certain periods of the year.

The demand for our cruises is seasonal, with greatest demand for cruises generally occurring during the third quarter. This seasonality in demand has resulted in fluctuations in our revenues and results of operations. The seasonality of our results is increased due to ships being taken out of service for drydocks, which we typically schedule during off-peak demand periods for such ships. Accordingly, seasonality in demand and drydock periods could adversely affect our ability to generate sufficient revenues to cover the expenses we incur during certain periods of the year.

Future epidemics and viral outbreaks may have an adverse effect on our financial condition and results of operations.

Public perception about the safety of travel and adverse publicity related to passenger or crew illness, including incidents of H1N1 flu, stomach flu, or other contagious diseases, may impact demand for cruises and result in cruise cancellations and employee absenteeism. Such events could decrease our future sales and increase our operating expenses, adversely affecting our financial condition and results of operations.

Adverse incidents and publicity involving cruise ships may have an adverse effect on our financial condition and results of operations.

The operation of cruise ships carries an inherent risk of loss caused by adverse events at sea or in port and by weather conditions. Adverse incidents could involve collisions, groundings, fire, oil spills, other maritime or environmental mishaps, mechanical failure, missing passengers, inappropriate crew or passenger behavior, onboard crimes, human errors, terrorism, piracy, political action and civil unrest or insurrection.

Adverse incidents such as these could result in increased costs, lost sales, injuries, loss of life or property or reputational damage. We could be forced to cancel a cruise or a series of cruises due to such events, resulting in reimbursements to passengers, increased port-related costs and lost revenue. If there is a significant accident, mechanical failure or similar problem involving a ship, we may have to place a ship in an extended drydock period for repairs. This could result in material lost revenue and/or expenditures, and there can be no assurance that insurance proceeds would compensate us fully or at all for our losses. We have experienced unscheduled drydocks in the past and there can be no assurances that we will not experience unexpected drydocks in the future. Any such event involving our cruise ships or other cruise ships may adversely affect passengers’ perceptions of safety, negatively affect future industry performance or result in increased governmental or other regulatory oversight. Such incidents also may lead to litigation against us. We may suffer penalties, fines and damages from judgments or settlements of any ongoing or future claims against us. Anything that damages our reputation (whether or not justified), including adverse publicity about passenger safety, could adversely impact demand and reduce our sales. Such incidents may have a material adverse impact on our financial condition and results of operations.

There can be no assurance that all risks are insured against or that any particular claim will be fully paid. Such losses, to the extent that they are not adequately covered by contractual remedies or insurance, could affect our financial condition and results of operations. We have been and may continue to be subject to calls, or premiums, in amounts based not only on our own claim records, but also the claim records of all other members of the protection and indemnity associations through which we receive indemnity coverage for tort liability. Our payment of these calls could result in significant expenses to us, which could reduce our cash flows. If we were to sustain significant losses in the future, our ability to obtain insurance coverage or coverage at commercially reasonable rates could be materially adversely affected.

Data security breaches, denial of service attacks, and/or disruptions to our information technology, telecommunications, and/or other networks could have an adverse impact on our financial results.

The integrity and reliability of our information technology, telecommunications, and other networks are crucial to our operations and financial results. Disruptions to these networks could impair our operations and have an adverse impact on our financial results, negatively affect our reputation and customer demand. In addition, certain networks are dependent on third-party technologies, systems and service providers for which there is no certainty of uninterrupted availability. Among other things, actual or threatened natural disasters (e.g., hurricanes, earthquakes, tornadoes, fires, floods) or similar events, information systems failures, computer viruses, denial or service attacks, and other cyber-attacks may cause disruptions to our information technology, telecommunications, and other networks. While we have and continue to invest in business continuity, disaster recovery and data restoration plans, we cannot completely insulate ourselves from disruptions that could result in adverse effects on our operations and financial results. We carry limited business interruption insurance for certain of our shoreside operations, subject to limitations, exclusions and deductibles.

In the event of a data security breach of our systems and/or third-party systems, we may incur costs associated with the following: breach response, notification, forensics, regulatory investigations, public relations, consultants, credit identity monitoring, credit freezes, fraud alert, credit identity restoration, credit card cancellation, credit card reissuance or replacement, regulatory fines and penalties, vendor fines and penalties, legal fees and damages. Denial of service attacks may result in costs associated with, among other things, the following: response, forensics, public relations, consultants, data restoration, legal fees and settlement. In addition, data security breaches or denial of service attacks may cause business interruption, information technology disruption, disruptions as a result of regulatory investigation, digital asset loss related to corrupted or destroyed data, damage to our reputation, damages to intangible property, and other intangible damages, such as loss of consumer confidence, all of which could impair our operations and have an adverse impact on our financial results. While we have and continue to invest in data and information technology security initiatives, we cannot completely insulate ourselves from the risks of data security breaches and denial of service attacks that could result in adverse effects on our operations and financial results. We carry privacy liability and network security insurance to partially cover us in the event of an attack.

Unavailability of ports of call may adversely affect our results of operations and financial condition.

We believe that attractive port destinations are a major reason why passengers choose to go on a particular cruise versus an alternative vacation option. The availability of ports, including the specific port facility at which our guests will embark and disembark, is affected by a number of factors, including, but not limited to, existing capacity constraints, security, safety and environmental concerns, adverse weather conditions and natural disasters, financial limitations on port development, political instability, exclusivity arrangements that ports may have with our competitors, local governmental regulations and fees, local community concerns about port development and other adverse impacts on their communities from additional tourists, and sanctions programs implemented by the Office of Foreign Assets Control of the United States Treasury Department or other regulatory bodies. Any limitations on the availability of ports of call or on the availability of shore excursion and other service providers at such ports could adversely affect our results of operations and financial condition.

The loss of key personnel, our inability to recruit or retain qualified personnel or the diversion of our key personnel’s attention could adversely affect our results of operations.

We rely upon the ability, expertise, judgment, discretion, integrity and good faith of our senior management team. Our success is dependent upon our personnel and key consultants and our ability to recruit and retain high quality employees. We must continue to recruit, retain and motivate management and other employees sufficient to maintain our current business and support our projected growth. The loss of services of any of our key management, in particular, Mr. Frank J. Del Rio, our Chief Executive Officer, could have a material adverse effect on our business. See “Management” and “Executive Compensation” for additional information about our management personnel.

The leadership of our Chief Executive Officer and other executive officers has been a critical element of our success. The death or disability of Mr. Frank J. Del Rio or other extended or permanent loss of his services, or any negative market or industry perception with respect to him or arising from his loss, could have a material adverse effect on our business. Our other executive officers and other members of senior management have substantial experience and expertise in our business and have made significant contributions to our growth and success. The unexpected loss of services of one or more of these individuals could also adversely affect us. We are not protected by key person or similar life insurance covering members of our senior management. We have employment agreements with certain of our executive officers, but these agreements do not guarantee that any given executive will remain with us.

A failure to keep pace with developments in technology could impair our operations or competitive position.

Our business continues to demand the use of sophisticated systems and technology. These systems and technologies must be refined, updated and replaced with more advanced systems on a regular basis in order for us to meet our customers’ demands and expectations. If we are unable to do so on a timely basis or within reasonable cost parameters, or if we are unable to appropriately and timely train our employees to operate any of these new systems, our business could suffer. We also may not achieve the benefits that we anticipate from any new system or technology, such as fuel abatement technologies, and a failure to do so could result in higher than anticipated costs or could impair our operating results.

Our sponsor controls us, and the interests of our sponsor may conflict with or differ from our interests or the interests of our public shareholders.

Prior to this offering, funds affiliated with Apollo beneficially owned approximately 59% of our outstanding common stock, and immediately after giving effect to this offering, Apollo will own approximately % of our outstanding common stock (without giving effect to the exercise of the underwriters’ option to purchase additional shares). The PCI Stockholders’ Agreement (as defined herein) gives funds affiliated with Apollo effective control over our affairs and policies, subject to certain limitations. Funds affiliated with Apollo also control the election of our Board of Directors, the appointment of management, the entering into of mergers, sales of substantially all of our assets and other material transactions. In addition, three of our directors are

affiliated with Apollo. As a result, funds affiliated with Apollo, through the PCI Stockholders’ Agreement and their voting and board control, have the ability to control our policies and business, including the election of our directors, the approval of significant transactions such as mergers and tender offers and the sale of all or substantially all of our assets. Funds affiliated with Apollo also have the authority, subject to the terms of the agreements governing our indebtedness, to issue additional debt, implement debt repurchase programs, pay dividends, pay advisory fees (including to themselves or their affiliates) and make other key decisions, and they may do so at any time. The interests of Apollo and its affiliated funds could conflict with or differ from our interests or the interests of our public shareholders.

Furthermore, funds affiliated with Apollo are in the business of making investments in companies, and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. For example, funds affiliated with Apollo are significant shareholders and control the board of Norwegian Cruise Line Holdings Ltd., which, though it does not compete with us in the Luxury segment, competes with us indirectly as a cruise operator. Any such investment may increase the potential for conflicts of interest. There are no agreements that govern the outcome of any conflicts of interests among us and any affiliates of Apollo. There is no assurance that when conflicts of interest arise, any or all of these affiliates will act in our best interests or that any conflict of interest will be resolved in our favor. Moreover, the concentration of ownership held by funds affiliated with Apollo could delay, defer or prevent a change of control of our company or impede a merger, takeover or other business combination that may otherwise be viewed favorably to us. Funds affiliated with Apollo may also pursue acquisition opportunities that may be complementary to our business, and as a result, those acquisition opportunities may not be available to us. Certain provisions of the PCI Stockholders’ Agreement may also make it more difficult to reissue additional equity capital in the future, if needed. See “Certain Relationships and Related Party Transactions—Stockholders’ Agreement.”

Risks Related to the Regulatory Environment in Which We Operate

Future changes in applicable tax laws, or our inability to take advantage of favorable tax regimes, may have an adverse impact on our financial condition and results of operations.

As we generally derive revenue from shipboard activity in international waters and not in a particular jurisdiction, our exposure to income tax is limited in some instances. We do, however, submit to the income tax regimes of the jurisdictions in which we operate and pay taxes as required by those regimes.

It is possible that certain states, countries or ports of call that our ships visit may decide to assess new taxes or fees or change existing taxes or fees specifically applicable to the cruise industry and its employees and/or guests, which could adversely affect our financial condition and results of operations.

Provided that we satisfy certain complex stock ownership tests (as described below), income that is considered to be derived from the international operation of ships, as well as certain income that is considered to be incidental to such income (“Shipping Income”), is currently exempt from U.S. federal income taxes under Section 883 of the Internal Revenue Code of 1986, as amended (the “Code”). The U.S.-source portion of our Shipping Income (if we do not qualify for the exemption under Section 883 of the Code) and the U.S.-source portion of our income that is not Shipping Income are generally subject to U.S. federal corporate income tax on a net basis (generally at a 35% rate) and possible state and local taxes, and our effectively connected earnings and profits generally are subject to an additional branch profits tax of 30%. See “Business—Taxation—U.S. Federal Income Taxation of Regent and Oceania Shipping Income.”

We believe substantially all of our income derived from the international operation of ships is properly categorized as Shipping Income, and that our income other than Shipping Income is not currently, nor is it expected to become, a material amount. It is possible, however, that a material amount of our income does not actually qualify (or will not qualify) as Shipping Income.

Even if our interpretation of Section 883 is correct, the exemption for Shipping Income is not applicable in any year in which we do not satisfy complex stock ownership tests. While we believe that we have satisfied the

ownership tests and expect to continue to do so absent a material change in our ownership, the application of these tests is subject to some uncertainty and there is no assurance that our view is correct. Further, for the exemption for Shipping Income to apply, we must satisfy the Substantiation Requirements (as defined herein). While we expect we will satisfy such requirements, we can give no assurance that we will be able to do so. Additionally, any change in our operations could change the amount of our income that is considered Shipping Income under Section 883. Finally, any change in the tax laws governing our operations, including Section 883 of the Code and the regulations thereunder, could increase the amount of our income that is subject to tax. Any of the foregoing risks could significantly increase our exposure to U.S. federal income and branch profits taxes.

The Seven Seas Navigator and Seven Seas Voyager were operated by subsidiaries that were strategically and commercially managed in the United Kingdom (“UK”) and these subsidiaries had elected to enter the UK tonnage tax regime. Effective February 4, 2013, both ships exited the UK tonnage tax regime upon transfer of the ships to U.S. subsidiaries.

We are subject to complex laws and regulations, including environmental laws and regulations, which could adversely affect our operations. Any changes in the current laws and regulations could lead to increased costs or decreased revenue and adversely affect our business prospects, financial condition and results of operations.

Increasingly stringent federal, state, local and international laws and regulations on environmental protection, and the health and safety of workers could affect our operations. Many aspects of the cruise industry are subject to governmental regulation by the U.S. Environmental Protection Agency, the International Maritime Organization, (the “IMO”), the Council of the European Union, and the U.S. Coast Guard, as well as international treaties such as the International Convention for the Safety of Life at Sea (“SOLAS”), the International Convention for the Prevention of Pollution from Ships (“MARPOL”) and the Standard of Training Certification and Watchkeeping for Seafarers (“STCW”). For example, international regulations regarding ballast water and shipboard/shoreside security have been adopted. Additionally, the U.S. federal and various state, foreign and international regulatory agencies have enacted or are considering new environmental regulations or policies, such as requiring the use of low sulfur fuels, increasing fuel efficiency requirements, restricting diesel engine emissions and managing cruise ship waste. Compliance with such laws and regulations may entail significant expenses for ship modifications and changes in operating procedures, which could adversely impact our operations as well as our competitors’ operations. For example, in 2010, Alaska issued a final permit that regulates discharges of treated wastewater from cruise ships for the summer tourist seasons running from 2010 to 2012. The permit requires cruise companies to gather data on performance of new shipboard environmental control systems that will allow a scientific review committee to advise state officials on improving the regulations. These issues are, and we believe will continue to be, an area of focus by the relevant authorities throughout the world. This could result in the enactment of more stringent regulation of cruise ships that would subject us to increasing compliance costs in the future.

We may be subject to taxation under the laws of certain jurisdictions.

We may be subject to state, local and non-U.S. income or non-income taxes in various jurisdictions, including those in which we transact business, own property or reside. We may be required to file tax returns in some or all of those jurisdictions. Our state, local or non-U.S. tax treatment may not conform to the U.S. federal income tax treatment of Section 883 of the Code discussed above. We may be required to pay non-U.S. taxes on dispositions of foreign property and operations involving foreign property may give rise to non-U.S. income or other tax liabilities in amounts that could be substantial.

The various tax regimes to which we are currently subject result in a relatively low effective tax rate on our world-wide income. These tax regimes, however, are subject to change. Moreover, we may become subject to new tax regimes and may be unable to take advantage of favorable tax provisions afforded by current or future law.

Litigation, enforcement actions, fines or penalties could adversely impact our financial condition or results of operations and damage our reputation.

Our business is subject to various U.S. and international laws and regulations that could lead to enforcement actions, fines, civil or criminal penalties or the assertion of litigation claims and damages. In addition, improper conduct by our employees or agents could damage our reputation and/or lead to litigation or legal proceedings that could result in civil or criminal penalties, including substantial monetary fines. In certain circumstances, it may not be economical to defend against such matters, and a legal strategy may not ultimately result in us prevailing in a matter. Such events could lead to an adverse impact on our financial condition or results of operations.

As a result of any ship-related or other incidents, litigation claims, enforcement actions and regulatory actions and investigations, including, but not limited to, those arising from personal injury, loss of life, loss of or damage to personal property, business interruption losses or environmental damage to any affected coastal waters and the surrounding area, may be asserted or brought against various parties including us and/or our cruise brands. The time and attention of our management may also be diverted in defending such claims, actions and investigations. Subject to applicable insurance coverage, we may also incur costs both in defending against any claims, actions and investigations and for any judgments, fines, civil or criminal penalties if such claims, actions or investigations are adversely determined.

Risks Related to the Offering and to Our Common Stock

There has been no prior market for our common stock, and an active trading market for our common stock may not develop, which could impede your ability to sell your common stock and depress the market price of your common stock.

Prior to this offering, there has been no public market for our common stock, and we cannot assure you that an active and liquid public market for our common stock will develop or be sustained after this offering or that investors will in the future be able to sell the shares of our common stock they purchase in this offering should they desire to do so. The failure of an active trading market to develop could affect your ability to sell your common stock and depress the market price of your common stock. We will negotiate with the representatives of the underwriters to determine the initial public offering price, which will be based on numerous factors and may bear no relationship to the price at which our common stock will trade upon completion of this offering. See “Underwriting.” The market price of our common stock may fall below the initial public offering price.

The price of our shares may fluctuate substantially, and your investment may decline in value.

The trading price of our common stock could be volatile and subject to wide fluctuations in response to various factors, many of which are beyond our control, including those described in this “Risk Factors” section. Further, the stock markets in general, and the stock exchange and the market for travel and leisure-related companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. We cannot assure you that trading prices and valuations of our common stock will be sustained. These broad market and industry factors may materially and adversely affect the market price of our common stock, regardless of our operating performance. Market fluctuations, as well as general political and economic conditions in the countries where we operate, such as recession or currency exchange rate fluctuations, may also adversely affect the market price of our common stock. In the past, following periods of volatility in the market price of a company’s securities, that company is often subject to securities class-action litigation. This kind of litigation, regardless of the outcome, could result in substantial costs and a diversion of management’s attention and resources, which could have a material adverse effect on our business, results of operations and financial condition.

We are a “controlled company” within the meaning of the rules of and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements.

Upon the closing of this offering, funds affiliated with Apollo will continue to control a majority of our common stock. As a result, we will be a “controlled company” within the meaning of the corporate governance standards of . Under the rules of , a company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including:

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the requirement that a majority of our Board of Directors consists of independent directors;

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the requirement that we have a nominating and governance committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

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the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

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the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee.

Following this offering, we intend to utilize these exemptions. As a result, we will not have a majority of independent directors nor will be required to have any independent directors on our Nominating and Governance Committee and Compensation Committee, and we will not be required to have an annual performance evaluation of the Nominating and Governance Committee and Compensation Committee. See “Management.” Accordingly, you will not have the same protections afforded to shareholders of companies that are subject to the general corporate governance requirements (without giving effect to the “controlled company” exemptions) of .

Because the price you will pay for our common stock is above our net tangible book value per share of common stock, you will experience an immediate and substantial dilution upon the completion of this offering.

The initial public offering price of our common stock is substantially higher than what the net tangible book value per share of common stock will be immediately after this offering. If you purchase our common stock in this offering, you will experience immediate dilution of approximately $ in the net tangible book value per share of common stock from the price you pay for our common stock, representing the difference between (1) the assumed initial public offering price of $ per share of common stock, which is the midpoint of the range shown on the cover of this prospectus, and (2) the pro forma net tangible book value per share of common stock of $ at December 31, 2013, after giving effect to this offering. For additional information on discussion of the effect of a change in the price of this offering see “Dilution.”

As a shareholder of our Company, you may have greater difficulties in protecting your interests than as a shareholder of a U.S. corporation.

We are a Panamanian corporation (“ sociedad anónima”). Under Panamanian law, the protections afforded to minority shareholders are different from, and much more limited than, those in the United States and some other Latin American countries. For example, the legal framework with respect to shareholder disputes is less developed under Panamanian law than under U.S. law and there are different procedural requirements for bringing shareholder lawsuits, including shareholder derivative suits. As a result, it may be more difficult for our minority shareholders to enforce their rights against us or our directors or controlling shareholder than it would be for shareholders of a U.S. company. In addition, Panamanian law does not afford minority shareholders as many protections for investors through corporate governance mechanisms as in the United States and provides no mandatory tender offer or similar protective mechanisms for minority shareholders in the event of a change in control.

If we are unable to implement and maintain effective internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.

As a public company, we will be required to maintain internal controls over financial reporting and to report any material weaknesses in such internal controls. We are in the process of designing, implementing and testing the internal control over financial reporting in order to furnish a report by management on the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). In the past, material weaknesses in our internal control over financial reporting have been identified relating to derivatives and stock compensation, which have been remediated. In the future, if we identify material weaknesses in our internal control over financial reporting, or if we are unable to comply with the requirements of Section 404 in a timely manner, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected.

The market price for our common stock could be subject to wide fluctuations, and you could lose all or part of your investment.

The market price for our common stock could be volatile and subject to wide fluctuations in response to factors including the following:

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actual or anticipated fluctuations in our quarterly results;

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the public reaction to our press releases, other public announcements and filings with the SEC;

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sales of large blocks of our common stock, or the expectation that such sales may occur, including sales by our directors, officers, Apollo or other significant shareholders;

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market and industry perception of our success, or lack thereof, in pursuing our growth strategy;

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announcements of new itineraries or services or the introduction of new ships by us or our competitors;

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changes in financial estimates by securities analysts;

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conditions in the cruise industry;

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price and volume fluctuations in the stock markets generally;

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announcements by our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;

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our involvement in a significant acquisition, strategic alliance or joint venture;

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changes in government and environmental regulation;

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additions or departures of key personnel;

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changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resulting from natural disasters, terrorist attacks, acts of war and responses to such events;

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changes in accounting standards, policies, guidance, interpretations or principles; or

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potential litigation.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our common stock.

The substantial number of shares of common stock that will be eligible for sale in the near future may cause the market price of our common stock to decline.

Immediately after the completion of this offering, we will have an aggregate of shares of common stock issued and outstanding (without giving effect to the exercise of the underwriters’ option to purchase additional shares). Our common stock sold in this offering will be eligible for immediate resale in the public market without restrictions, and those shares held by Apollo and key employees may also be sold in the public market in the future subject to applicable lock-up agreements as well as the restrictions contained in Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”). If funds affiliated with Apollo sell a substantial amount of our common stock after the expiration of the lock-up period, the prevailing market price for our common stock could be adversely affected. See “Shares Eligible for Future Sale.”

We may issue shares of our common stock or other securities from time to time as consideration for future acquisitions and investments. If any such acquisition or investment is significant, the number of shares of common stock, or the number or aggregate principal amount, as the case may be, of other securities that we may issue may in turn be substantial. We may also grant registration rights covering those shares of common stock or other securities in connection with any such acquisitions and investments.

We may use the proceeds of this offering in ways with which you may not agree.

Although we currently intend to use the proceeds of this offering to repay outstanding indebtedness and to pay expenses associated with this offering, our management also intends to use a portion of the proceeds for future capital expenditures and general corporate purposes. Our management will have considerable discretion in such applications of the net proceeds received by us. You will not have the opportunity, as part of your investment decision, to assess whether any proceeds used for such purposes are being used appropriately. You must rely on the judgment of our management regarding the application of the net proceeds of this offering. The net proceeds may be used for capital expenditures or corporate purposes that do not improve our efforts to achieve profitability or increase the price of our common stock.

We do not intend to pay dividends on our common stock at any time in the foreseeable future.

We do not currently intend to pay dividends to our shareholders and our Board of Directors may never declare a dividend. You should not anticipate receiving dividends with respect to common stock that you purchase in the offering. The agreements governing our indebtedness limit or prohibit, and any of our future debt arrangements may restrict, among other things, the ability of our subsidiaries to pay distributions to us and our ability to pay cash dividends to our shareholders. In addition, any determination to pay dividends in the future will be entirely at the discretion of our Board of Directors and will depend upon our results of operations, cash requirements, financial condition, business opportunities, contractual restrictions, restrictions imposed by applicable law and other factors that our Board of Directors deems relevant. We are not legally or contractually required to pay dividends. Accordingly, if you purchase common stock in this offering, it is likely that in order to realize a gain on your investment, the price of our common stock will have to appreciate. This may or may not occur. In addition, we are a holding company and would depend upon our subsidiaries for their ability to pay distributions to us to finance any dividend or pay any other of our obligations. Investors seeking dividends should not purchase our common stock. See “Dividend Policy.”

Enforcement of civil liabilities against us by our shareholders and others may be difficult.

We are a corporation (“ sociedad anónima”) incorporated under the laws of Panama. In addition, certain of our subsidiaries are organized outside the United States. A substantial portion of our assets are located outside the United States. As a result, it may not be possible for investors to effect service of process upon us or upon such persons within the United States or to enforce judgments obtained in U.S. courts against us or them predicated upon the civil liability provisions of the U.S. federal securities laws. Furthermore, we have been advised by counsel in Panama that Panamanian courts will not enforce a U.S. federal securities law that is either penal or contrary to the public policy of Panama. An action brought pursuant to a public or penal law, the purpose of which is the enforcement of a sanction, power or right at the instance of the state in its sovereign

capacity, may not be entertained by a Panamanian court. Certain remedies available under the laws of U.S. jurisdictions, including certain remedies under U.S. federal securities laws, may not be available under Panamanian law or enforceable in a Panamanian court, as they may be contrary to Panamanian public policy. Further, no claim may be brought in Panama against us or our directors and officers in the first instance for violations of U.S. federal securities laws, because these laws have no extraterritorial jurisdiction under Panamanian law and do not have force of law in Panama. A Panamanian court may, however, impose civil liability on us or our directors and officers if the facts alleged in a complaint constitute or give rise to a cause of action under Panama law.

Provisions in our constitutional documents may prevent or discourage takeovers and business combinations that our shareholders might consider to be in their best interests.

Following the consummation of this offering, our by-laws will contain provisions that may delay, defer, prevent or render more difficult a takeover attempt that our shareholders consider to be in their best interests. As a result, these provisions may prevent our shareholders from receiving a premium to the market price of our shares offered by a bidder in a takeover context. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our shares if they are viewed as discouraging takeover attempts in the future. These provisions include (subject to the PCI Stockholders’ Agreement):

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the ability of our Board of Directors to designate one or more series of preference shares and issue preference shares without shareholder approval;

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a classified board of directors;

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the sole power of a majority of our Board of Directors to fix the number of directors;

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the power of our Board of Directors to fill any vacancy on our Board of Directors in most circumstances, including when such vacancy occurs as a result of an increase in the number of directors or otherwise; and

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advance notice requirements for nominating directors or introducing other business to be conducted at shareholder meetings.

Additionally, our by-laws will contain provisions that prevent third parties, other than Apollo, from acquiring beneficial ownership of more than 4.9% of our outstanding shares without the consent of our Board of Directors, and will provide for the lapse of rights, and sale, of any shares acquired in excess of that limit. The effect of these provisions, as well as the significant ownership of common stock by Apollo, may preclude third parties from seeking to acquire a controlling interest in us in transactions that shareholders might consider to be in their best interests, and may prevent shareholders from receiving a premium above market price for their shares. See “Certain Relationships and Related Party Transactions—Stockholders’ Agreement” and “Description of Capital Stock.”

Any issuance of preferred stock could make it difficult for another company to acquire us or could otherwise adversely affect holders of our common stock, which could depress the price of our common stock.

Our Board of Directors has the authority to issue preferred stock and to determine the preferences, limitations and relative rights of shares of preferred stock and to fix the number of shares constituting any series and the designation of such series, without any further vote or action by our shareholders, subject to the PCI Stockholders’ Agreement. Our preferred stock could be issued with voting, liquidation, dividend and other rights superior to the rights of our common stock. The potential issuance of preferred stock may delay or prevent a change in control of us, discouraging bids for our common stock at a premium over the market price, and adversely affect the market price and the voting and other rights of the holders of our common stock. See “Description of Capital Stock.”

USE OF PROCEEDS

We intend to use the net proceeds from this offering (i) to redeem $ million of Regent’s outstanding Senior Secured Notes, (ii) to repay $ million of the Oceania Term Loan and $ million of the Regent Term Loan and (iii) for future capital expenditures and general corporate purposes.

As of December 31, 2013, we had $225.0 million in aggregate principal amount of Senior Secured Notes outstanding, which bear interest at an annual rate of 9.125% and mature on May 15, 2019. As of December 31, 2013, we had approximately $299.3 million in principal amount outstanding under the Oceania Term Loan, which bears interest at LIBOR with a floor of 1% plus an applicable margin of 5.75% and matures in July 2020. As of December 31, 2013, we had approximately $296.3 million in principal amount outstanding under the Regent Term Loan, which bears interest at LIBOR with a floor of 1.25% plus an applicable margin of 3.50% and matures in December 2018. The proceeds of both the Oceania Term Loan and the Regent Term Loan were used to repay the outstanding balances of a previously existing credit facility and for general corporate purposes.

A $1.00 increase or decrease in the assumed initial public offering price of $ per share would increase or decrease, as applicable, the net proceeds to us from this offering by approximately $ million (or $ million if the underwriters exercise in full their option to purchase additional shares), assuming the number of shares offered by us remains the same as set forth on the cover page of this prospectus and after deducting the underwriting discount and estimated offering expenses.

DIVIDEND POLICY

We have no current plans to pay dividends on our common stock . The agreements governing our indebtedness prohibit, among other things, our ability to pay cash dividends to our shareholders above specified levels. Our future dividend policy will also depend on the requirements of any future financing agreements to which we may be a party and other factors considered relevant by our Board of Directors. In addition, any determination to pay dividends in the future will be at the discretion of our Board of Directors and will depend upon our results of operations, financial condition, contractual restrictions, restrictions imposed by applicable law and other factors that our Board of Directors deems relevant.

We did not declare or pay any dividends on our common stock in 2013, 2012 or 2011.

CAPITALIZATION

The following table sets forth our capitalization as of December 31, 2013:

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on an actual basis; and

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on an as adjusted basis to give effect to (i) the restructuring and capitalization of our related party debt and (ii) the issuance of the common stock in this offering and the application of the net proceeds therefrom, as described under “Use of Proceeds.”

You should read this table together with the information contained in this prospectus, including “Use of Proceeds,” “Selected Consolidated Financial Data,” “Unaudited Pro Forma Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Certain Indebtedness” and our historical financial statements and related notes included elsewhere in this prospectus.


	As of December 31, 2013
(in thousands, except share and per share data)	Actual			As adjusted (1)
Cash and cash equivalents	$	286,419

Oceania Term Loan, First Lien, due through 2020 (4)	$	299,250
Oceania Marina Newbuild Debt, due through 2023		424,123
Oceania Riviera Newbuild Debt, due through 2024		471,611
Regent Term Loan, First Lien, due through 2018 (4)		296,250
Regent Senior Secured Notes, due 2019		225,000

Total third party debt (2)		1,716,234
Related party notes payable (3)		861,332
Shareholders’ Equity:
Common stock, $.01 par value; 100,000,000 shares authorized and 13,569,765 shares issued and outstanding; shares authorized and shares issued and outstanding, as adjusted		136
Additional paid-in capital		307,030
Accumulated deficit		(223,280	)
Accumulated other comprehensive loss		(56,249	)
Treasury shares at cost		(55	)

Total shareholders’ equity		27,582

Total capitalization	$	2,605,148		$

(1)

Each $1.00 increase or decrease in the assumed initial public offering price of $ per share would increase or decrease, as applicable, the amount of our as adjusted long-term debt, additional paid-in capital and total stockholders’ equity by approximately $ million, assuming the number of shares offered by us remains the same as set forth on the cover page of this prospectus and after deducting the estimated underwriting discounts and commissions and estimated offering expenses that we must pay.

(2)	Excludes the debt discount of $29.7 million as of December 31, 2013.

(3)	Excludes the related unamortized discount of $149.7 million as of December 31, 2013.

(4)	On February 7, 2014, these loans were amended. See “Description of Certain Indebtedness” for additional information.

DILUTION

If you invest in our common stock in this offering, your investment will be immediately diluted to the extent of the difference between the initial public offering price per share of common stock and the net tangible book value per share of common stock upon completion of this offering. Dilution results from the fact that the per share offering price of the common stock is substantially in excess of the net tangible book value per share attributable to the common stock held by existing owners.

Our net tangible book value as of December 31, 2013 was $ million, or $ per share, based on 13,569,765 shares outstanding as of December 31, 2013. Net tangible book value per share of common stock is equal to our total tangible assets less total liabilities, divided by the number of issued and outstanding shares of common stock as of the most recent quarter for which financial statements are available.

After giving effect to (a) our sale of shares of common stock in this offering at an assumed initial public offering price of $ per share, which is the midpoint of the price range per share of common stock set forth on the cover of this prospectus, and after deducting the underwriting discount and estimated offering expenses, and (b) our issuance of shares of common stock upon the exercise of outstanding options and our receipt of the aggregate exercise price therefrom since December 31, 2013, our net tangible book value as of December 31, 2013 would have been approximately $ million, or $ per share. This represents an immediate increase in net tangible book value of $ per share to our existing shareholders and an immediate dilution of $ per share to new investors purchasing common stock in this offering at the assumed initial public offering price. The following table illustrates the per share dilution on a per share basis:

The following table illustrates the per share dilution on a per share of common stock basis:


Assumed initial public offering price per share		$

Net tangible book value per share as of December 31, 2013
Increase in net tangible book value per share attributable to existing shareholders
Increase in net tangible book value attributable to exercise of stock options
Net tangible book value per share after giving effect to this offering

Dilution per share to new investors in this offering		$

A $1.00 increase or decrease in the assumed initial public offering price of $ per share of common stock would increase or decrease, as applicable, our net tangible book value after giving effect to this offering by $ million, or by $ per share of common stock, assuming the number of shares offered by us remains the same and after deducting the underwriting discount and the estimated offering expenses payable by us.

If the underwriters’ option to purchase additional shares of common stock from us is exercised in full, the net tangible book value per share of common stock, as adjusted to give effect to this offering, would be $ per share, and the dilution in net tangible book value per share to new investors in this offering would be $ per share.

The following table summarizes as of December 31, 2013, on an adjusted basis, the number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid by existing shareholders and by new investors purchasing common stock in this offering (before deducting the estimated underwriting discount and estimated offering expenses) based upon an assumed initial public offering price of $ per share, which is the midpoint of the price range per share of common stock set forth on the cover of this prospectus, before deducting the underwriting discount and estimated offering expenses:

Shares Purchased

Total Consideration

Average Price
Per Share

Number

Percent

Amount

Percent

Existing shareholders

New investors in this offering

Total

Each $1.00 increase or decrease in the assumed offering price of $ per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the total consideration paid by investors in this offering and total consideration paid by all shareholders by $ million, assuming the number of shares offered by us remains the same and after deducting the underwriting discount and the estimated offering expenses payable by us.

Except as otherwise indicated, the above discussion and tables assume no exercise of the underwriters’ option to purchase additional shares of common stock from us. If the underwriters’ option to purchase additional shares of common stock were exercised in full, our existing shareholders would own % and our new investors in this offering would own % of the total number of our shares of common stock outstanding upon the completion of this offering.

The dilution information above is for illustration purposes only. Our net tangible book value following the consummation of this offering is subject to adjustment based on the actual initial public offering price of our shares and other terms of this offering determined at pricing.

The number of our shares of common stock that will be outstanding after this offering is based on shares of common stock outstanding as of the date of this prospectus, and excludes shares of common stock issuable upon the exercise of options to purchase our common stock outstanding as of the date of this prospectus, with a weighted-average exercise price of $ per share.

As of the date of this prospectus, there are options outstanding to purchase a total of shares of common stock with a weighted average exercise price of $ per share and there are shares available for future awards. To the extent that any of these additional options are exercised, there will be further dilution to new public investors. See “Capitalization,” “Executive Compensation—Equity Incentive Plan Awards” and the notes to our consolidated financial statements included elsewhere in this prospectus.

SELECTED CONSOLIDATED FINANCIAL DATA

The following table sets forth our selected consolidated financial data as of the dates and for the periods indicated. The selected consolidated financial data for the years ended December 31, 2013, 2012, and 2011 and as of December 31, 2013 and 2012 have been derived from our audited consolidated financial statements and related notes included elsewhere in this prospectus. The selected consolidated financial data for the years ended December 31, 2010 and 2009 and as of December 31, 2011, 2010, and 2009 have been derived from our audited consolidated financial statements not included in this prospectus.

The historical results set forth below do not necessarily indicate results expected for any future period, and should be read in conjunction with, “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Certain Indebtedness” and our consolidated financial statements and related notes thereto included elsewhere in this prospectus.


(in thousands, except per share data)	Year Ended December 31,
(in thousands, except per share data)	2013			2012			2011			2010			2009
Statement of Income data
Revenue
Passenger ticket	$	1,001,610		$	947,071		$	834,868		$	642,068		$	529,646
Onboard and other		162,947			151,213			134,270			107,025			94,116
Charter		18,779			13,737			—			—			—

Total revenue		1,183,336			1,112,021			969,138			749,093			623,762

Cruise operating expense
Commissions, transportation and other		323,841			331,254			271,527			192,285			143,372
Onboard and other		43,518			40,418			36,854			28,981			28,746
Payroll, related and food		177,953			168,594			153,754			122,801			113,203
Fuel		101,690			101,685			92,921			57,913			44,220
Other ship operating		98,062			95,808			86,022			68,517			61,732
Other		16,416			21,968			26,305			16,085			37,016

Total cruise operating expense		761,480			759,727			667,383			486,582			428,289
Selling and administrative		174,866			153,747			145,802			134,676			116,989
Depreciation and amortization		83,829			93,003			79,269			56,606			62,528

Total operating expense		1,020,175			1,006,477			892,454			677,864			607,806

Operating income		163,161			105,544			76,684			71,229			15,956

Non-operating income (expense)
Interest expense, net of capitalized interest		(141,634	)		(131,651	)		(101,560	)		(91,325	)		(91,048	)
Interest income		540			752			670			513			143
Other income (expense) (1)		13,209			22,956			(45,901	)		(42,179	)		12,902

Total non-operating expense		(127,885	)		(107,943	)		(146,791	)		(132,991	)		(78,003	)

Income (loss) before income taxes		35,276			(2,399	)		(70,107	)		(61,762	)		(62,047	)
Income tax benefit (expense), net		246			(213	)		335			(358	)		171

Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)	$	(62,120	)	$	(61,876	)

Earnings (loss) per share
Basic	$	2.62		$	(0.19	)	$	(5.14	)	$	(4.60	)	$	(4.63	)

Diluted	$	1.88		$	(0.19	)	$	(5.14	)	$	(4.60	)	$	(4.63	)

Unaudited pro forma e arnings per share
Basic

Diluted


(in thousands)	As of December 31,
(in thousands)	2013		2012			2011			2010		2009
Balance sheet data:
Cash and cash equivalents	$	286,419	$	139,556		$	147,212		$	117,635	$	149,838
Total assets		2,989,886		2,872,110			2,479,581			1,939,146		1,837,955
Passenger deposits		432,564		365,296			336,203			291,977		247,484
Long-term debt (2)		1,596,218		1,695,656			1,328,518			830,724		878,036
Total debt (2)		1,686,544		1,713,216			1,350,840			855,724		903,036
Related party notes payable		711,617		661,304			615,143			572,736		499,152
Total liabilities		2,962,304		2,885,453			2,489,409			1,916,804		1,817,980
Total stockholders’ equity (deficit)		27,582		(13,343	)		(9,828	)		22,342		19,975

(1)	Other income (expense) consists of a variety of non-operating items including but not limited to foreign transaction gains and losses, gain (loss) on early extinguishment of debt and realized and unrealized gain (loss) on derivative instruments.

(2)	Includes the debt discount of $29.7 million and $32.8 million as of December 31, 2013 and 2012, respectively.

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA

The following tables present unaudited pro forma balance sheet data as of December 31, 2013 and the pro forma statement of operations data for the year ended December 31, 2013. We derived the unaudited pro forma consolidated financial data from our audited financial statements included elsewhere in this prospectus. The pro forma balance sheet and the statement of operations presented are not necessarily indicative of what our actual results of operations would have been as of the date and for the periods indicated, nor does it purport to represent our future results of operations.

The unaudited pro forma consolidated financial data is presented to give effect to the restructuring and capitalization of our related party debt. The unaudited pro forma consolidated balance sheet assumes that the restructuring and capitalization of our related party debt occurred on December 31, 2013. The unaudited pro forma consolidated statement of operations for the year ended December 31, 2013 assumes that the restructuring and capitalization of our related party debt occurred on January 1, 2013.

You should read the following table in conjunction with “Prospectus Summary,” “Use of Proceeds,” “Selected Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the historical financial statements and the notes thereto included elsewhere in this prospectus.


	As of December 31, 2013
(in thousands)	Unaudited			Pro Forma Adjustments (1)			Pro Forma Adjusted
	(unaudited)
Balance sheet data:
Assets:
Current assets
Cash and cash equivalents	$	286,419
Restricted cash		30,765
Trade and other receivables, net		16,277
Inventories		16,310
Prepaid expenses		45,588
Other current assets		14,722

Total current assets		410,081
Property and equipment, net		2,012,710
Goodwill		404,858
Intangible assets, net		81,324
Other long-term assets		80,913

Total assets	$	2,989,886

Liabilities and Stockholders’ Equity:
Current liabilities:
Accounts payable	$	12,236
Accrued expenses		98,725
Passenger deposits		414,757
Derivative liabilities		7,089
Current portion of long-term debt		90,326

Total current liabilities		623,133
Long-term debt		1,596,218
Related party notes payable (2)		711,617		$	(711,617	)
Other long-term liabilities		31,336

Total liabilities		2,962,304			(711,617	)

Stockholders’ equity:
Common stock (1)		136
Additional paid-in capital (1)		307,030
Accumulated deficit (1)		(223,280	)		50,312
Accumulated other comprehensive loss		(56,249	)
Treasury shares at cost, 6,000 shares held at 2013		(55	)

Total stockholders’ equity		27,582

Total liabilities and stockholders’ equity	$	2,989,886

(1)

The Pro Forma column in the balance sheet data table reflects (i) the restructuring and capitalization of our related party debt as of December 31, 2013, (ii) the impact on related party interest expense as reported in interest expense, net of capitalized interest on our consolidated statement of operations for the year ended December 31, 2013 and (iii) the effects to accumulated deficit on the consolidated balance sheet as of December 31, 2013 as a result of such pro forma adjustment to related party interest expense on the consolidated statement of operations for the year ended December 31, 2013.

(2)

The pro forma adjustment to related party notes payable in the balance sheet data table gives effect to the Pro Forma adjustments discussed in note 1 above. The related party debt consists of approximately $828.9 million plus related accrued interest of $32.5 million, less related unamortized discounts of $149.7 million, as of December 31, 2013.


	Year Ended December 31, 2013
(in thousands)	Unaudited			Pro Forma Adjustments		Pro Forma Adjusted
	(unaudited)
Statement of operations data:
Revenues:
Passenger ticket	$	1,001,610				$	1,001,610
Onboard and other		162,947					162,947
Charter		18,779					18,779

Total Revenue		1,183,336					1,183,336
Expenses
Cruise operating expenses
Commissions, transportation and other		323,841					323,841
Onboard and other		43,518					43,518
Payroll, related and food		177,953					177,953
Fuel		101,690					101,690
Other ship operating		98,062					98,062
Other		16,416					16,416

Total cruise operating expenses		761,480					761,480
Selling and administrative		174,866					174,866
Depreciation and amortization		83,829					83,829

Total operating expenses		1,020,175					1,020,175

Operating income		163,161					163,161

Non-operating income (expense)
Interest expense, net of capitalized interest (3)		(141,634	)	$	50,312		(91,322	)
Interest income		540					540
Other income (expense)		13,209					13,209

Total non-operating expense		(127,885	)		50,312		(77,573	)

Income before income taxes		35,276			50,312		85,588
Income tax benefit		246					246

Net income	$	35,522		$	50,312	$	85,834

Earnings per share
Basic	$	2.62				$

Diluted	$	1.88				$

Unaudited pro forma earnings (loss) per share
Basic

Diluted

(3)

The pro forma adjustments in the statement of operations data table to interest expense, net of capitalized interest gives effect to (i) the pro forma adjustments discussed in note 1 above, (ii) related party interest expense of approximately $32.5 million and $30.9 million for the year ended December 31, 2013 and 2012, respectively, and (iii) debt discount accretion of approximately $17.8 million and $15.3 million for the year ended December 31, 2013 and 2012, respectively.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations is intended to clarify the results of our operations, certain changes in our financial position, liquidity, capital structure and business developments for the periods covered by the consolidated financial statements included elsewhere in this prospectus. Our actual results could differ materially from those discussed below. This discussion should be read in conjunction with, and is qualified by reference to, the other related information contained in this prospectus, including the consolidated financial statements and the related notes thereto and the description of our business as well as the risk factors discussed in “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements.”

Key Operational and Financial Metrics, including Non-GAAP Measures

We utilize a variety of operational and financial metrics, which are defined below, to evaluate our performance and financial condition. We use certain non-GAAP financial measures, such as EBITDA, Adjusted EBITDA, Net Per Diems, Net Yields and Net Cruise Costs to enable us to analyze our performance and financial condition. We utilize these financial measures to manage our business on a day-to-day basis and believe that they are the most relevant measures of our performance. Some of these measures are commonly used in the cruise industry to measure performance. We believe these non-GAAP measures provide expanded insight to measure revenue and cost performance, in addition to the standard GAAP-based financial measures. There are no specific rules or regulations for determining non-GAAP measures, and as such, they may not be comparable to measures used by other companies within our industry. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. You should read this discussion and analysis of our financial condition and results of operations together with the reconciliation of these non-GAAP measures set forth in the footnotes to “Prospectus Summary—Summary Consolidated Financial Information.”

EBITDA is net income (loss) excluding depreciation and amortization, net interest expense and income tax benefit (expense).

Adjusted EBITDA is net income (loss) excluding depreciation and amortization, interest income, interest expense, other income (expense), and income tax benefit (expense), and other supplemental adjustments in connection with the calculation of certain financial ratios permitted in calculating covenant compliance under the indenture governing the Senior Secured Notes and our Secured Credit Facilities. We believe Adjusted EBITDA, when considered along with other performance measures, is a useful measure as it reflects certain operating drivers of our business, such as sales growth, operating costs, selling and administrative expense and other operating income and expense. We believe Adjusted EBITDA can provide a more complete understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. While Adjusted EBITDA is not a recognized measure under GAAP, management uses this financial measure to evaluate and forecast our business performance. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not take into account certain requirements such as capital expenditures and related depreciation, principal and interest payments, and tax payments, and it is subject to certain additional adjustments as permitted under the agreements governing our indebtedness. Our use of Adjusted EBITDA may not be comparable to other companies within our industry. Management compensates for these limitations by using Adjusted EBITDA as only one of several measures for evaluating our business performance. In addition, capital expenditures, which impact depreciation and amortization, interest expense, and income tax benefit (expense), are reviewed separately by management.

Available Passenger Cruise Days (“APCD”) is our measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period. We use this measure to perform capacity and rate analysis to identify our main non-capacity drivers that cause our cruise revenue and expense to vary.

Gross Cruise Cost represents the sum of total cruise operating expense plus selling and administrative expense.

Gross Yield represents total revenue, excluding charter per APCD.

Net Cruise Cost represents Gross Cruise Cost excluding commissions, transportation and other expense, and onboard and other expense.

Net Cruise Cost excluding Fuel and Other represents Gross Cruise Cost excluding commissions, transportation and other expense, onboard and other expense, fuel expense and other expense.

Net Per Diem represents Net Revenue divided by Passenger Days Sold. We utilize Net Per Diem to manage our business on a day-to-day basis, as we believe that it is the most relevant measure of our pricing performance as it reflects the revenues earned by us, net of our most significant variable costs. Other cruise lines use Net Yield to analyze business, which is a similar measurement that divides Net Revenue by APCD instead of Passenger Days Sold. The distinction is significant as other cruise companies focus more on potential onboard sales, resulting in a bias to fill each bed to maximize onboard revenue at the expense of passenger ticket revenue. Conversely, as our product has all-inclusive elements, we derive nearly all of our revenue from passenger ticket revenue. Hence it is far more important for us to maintain a pricing discipline focusing on passenger ticket revenue rather than to discount cruises in order to achieve higher occupancy to drive potential onboard revenues. We believe that this pricing discipline drives our revenue performance, our relatively long booking window, and allows us to maintain a positive relationship with the travel agency community.

Net Revenue represents total revenue, excluding charter revenue less commissions, transportation and other expense, and onboard and other expense.

Net Yield represents Net Revenue per APCD.

Occupancy is calculated by dividing Passenger Days Sold by APCD.

Passenger Days Sold (“PDS”) represents the number of revenue passengers carried for the period multiplied by the number of days within the period of their respective cruises.

Description of Certain Line Items

Revenues

Our revenue consists of the following:

•

Passenger ticket revenue consists of gross revenue recognized from the sale of passenger tickets net of dilutions, such as shipboard credits and certain included passenger shipboard event costs. Also included is gross revenue for air and related ground transportation sales.

•

Onboard and other revenue consists of revenue derived from the sale of goods and services rendered onboard the ships (net of related concessionaire costs as applicable), travel insurance (net of related costs), and cancellation fees. Also included in onboard and other revenue is gross revenue from pre- and post-cruise hotel accommodations, shore excursions, land packages, and ground transportation for which we assume the risks of loss for collections and cancellations. Certain of our cruises include free unlimited shore excursions (“FUSE”) and/or free pre-cruise hotel accommodations, and such free excursions and hotel accommodations have no revenue attributable to them. The costs for FUSE and free hotel accommodations are included in commissions, transportation and other expense in the consolidated statements of operations.

•

Charter revenue consists of charter hire fees, net of commissions, to bareboat charter with a third party. The charter agreement constitutes an operating lease and charter revenue is recognized on a straight-line basis over the charter term.

•

Cash collected in advance for future cruises is recorded as a passenger deposit liability. Those deposits for sailings traveling more than 12 months in the future are classified as a long-term liability. We recognize the revenue associated with these cash collections in the period in which the cruise occurs. For cruises that occur over multiple periods, revenue is prorated and recognized ratably in each period based on the overall length of the cruise. Cancellation fee revenue, along with associated commission expense and travel insurance revenue, if any, are recorded in the period the cancellation occurs.

Expenses

Cruise Operating Expense

Our cruise operating expense consists of the following:

•

Commissions, transportation and other consists of payments made to travel agencies that sell our product, costs associated with air and related ground transportation pre-sold to our guests, all credit card fees, and the costs associated with shore excursions and hotel accommodations included as part of the overall cruise purchase price.

•

Onboard and other consists of costs related to land packages and ground transportation, as well as shore excursions and hotel accommodations costs not included in commissions, transportation and other.

•

Payroll, related and food consists of the costs of crew payroll and related expenses for shipboard personnel, as well as food expenses for both passengers and crew. We include food and payroll costs in a single expense line item as we contract with a single vendor to provide many of our hotel and restaurant services, including both food and labor costs, which are billed on a per-passenger basis. This per-passenger fee reflects the cost of both of the aforementioned expenses.

•

Fuel consists of fuel costs and related delivery and storage costs.

•

Other ship operating consists of port, deck and engine, certain entertainment-related expenses, and hotel consumables expenses.

•

Other consists primarily of drydock, ship insurance costs, loss on disposals of ship related assets and passenger claims.

Selling and Administrative Expense

Selling and administrative expense includes advertising and promotional activities, shoreside personnel wages, benefits and expenses relating to our worldwide offices, professional fees, information technology support, our reservation call centers, and related support activities. Such expenditures are generally expensed in the period incurred.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with GAAP, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the related disclosures in the consolidated financial statements and accompanying footnotes. We believe that of our significant accounting policies, which are described in Note 2: “Basis of Presentation and Summary of Significant Accounting Policies” in our audited consolidated financial statements included elsewhere in this prospectus, the following accounting policies are critical because they involve a higher degree of judgment, and the estimates required to be made were based on assumptions that are inherently uncertain. As a result, these accounting policies could materially affect our financial position, results of operations, and related disclosures. On an ongoing basis, we evaluate these estimates and judgments based on historical experiences and various other factors that we believe reflect current circumstances. While we believe our estimates, assumptions and judgments are reasonable, they are based on information presently available. Actual results may differ significantly from these estimates due to changes in judgments, assumptions and conditions, which could have a material impact on our financial position or results of operations.

Asset Impairment

Goodwill

We record goodwill as the excess of the purchase price over the estimated fair value of net assets acquired, including identifiable intangible assets. We assess goodwill for impairment in accordance with ASC 350, Intangibles—Goodwill and Other , which requires that goodwill be tested for impairment at the “reporting unit level” (“Reporting Unit”) at least annually and more frequently when events or circumstances dictate, as defined by ASC 350. As our two cruise brands have similar economic characteristics, we have determined that we have only one Reporting Unit.

The impairment review for goodwill allows us to first assess qualitative factors to determine whether it is necessary to perform the more detailed two-step quantitative goodwill impairment test. We would perform the two-step test if our qualitative assessment determined it is more-likely-than-not that a Reporting Unit’s fair value is less than its carrying amount. We elected to bypass the qualitative assessment and proceed directly to step one of the quantitative test. The quantitative test for goodwill consists of a two-step process of first determining the estimated fair value of the Reporting Unit and comparing it to the carrying value of the net assets allocated to the Reporting Unit. If the estimated fair value of the Reporting Unit exceeds the carrying value, no further analysis or write-down of goodwill is required. If the estimated fair value of the Reporting Unit is less than the carrying value of its net assets, the implied fair value of the Reporting Unit is allocated to all of its underlying assets and liabilities, including both recognized and unrecognized tangible and intangible assets, based on their estimated fair value. If necessary, goodwill is then written down to its implied fair value.

Our annual impairment test date is September 30, which coincides with our annual budget/forecasting cycle and the end of our seasonally highest quarter. As of September 30, 2013, we did not have any impairment on goodwill. There were no triggering events that occurred between our impairment testing date and reporting date.

The principal assumptions used in our discounted cash flow model related to forecasting future operating results, including discount rate, Net Revenue yields, net cruise costs including fuel prices, capacity changes, weighted-average cost of capital for comparable publicly traded companies and terminal values, which are all considered level 3 inputs. Cash flows were calculated using our 2013 projected operating results as a base. To that base we added projected future years’ cash flows, considering the macro-economic factors and internal occupancy level projections, cost structure and other variables. We discounted the projected future years’ cash flows using a rate equivalent to the weighted-average cost of capital for comparable publicly traded companies. Based on the discounted cash flow model, we determined that the estimated fair value of goodwill exceeded the carrying value and is therefore not impaired. The estimated fair value exceeded its carrying value by 62% as of September 30, 2013.

The estimation of fair value utilizing discounted expected future cash flows includes numerous uncertainties, which require significant judgments when making assumptions of expected revenues, operating costs, selling and administrative expenses, capital expenditures, as well as assumptions regarding the cruise vacation industry competition and business conditions, among other factors. It is reasonably possible that changes in our assumptions and projected operating results above could lead to impairment of our goodwill.

Identifiable Intangible Assets

Specific to the Regent Seven Seas Transaction in 2008, we recorded identifiable intangible assets consisting of trade names, customer relationships, non-competition agreements, backlog and customer database. The Trade names acquired in this transaction, “Seven Seas Cruises” and “Luxury Goes Exploring,” were determined to have indefinite lives. During 2011, Regent amended its agreement with Regent Hospitality Worldwide, which granted exclusive and perpetual licensing rights to use the “Regent” trade name and trademarks (“Regent Licensing Rights”) in conjunction with cruises, subject to the terms and conditions stated in the agreement. The

amended and restated trademark license agreement allows us to use the Regent Licensing Rights, in conjunction with cruises, in perpetuity, subject to the terms and conditions stated in the agreement. The Regent Licensing Rights are being amortized over an estimated useful life of 40 years.

Our identifiable intangible assets, except the trade names acquired in the 2008 Regent Seven Seas Transaction noted above, are subject to amortization over their estimated lives and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable based on market factors and operational considerations. Identifiable intangible assets not subject to amortization, such as trade names, are reviewed for impairment whenever events or circumstances indicate, but at least annually, by comparing the estimated fair value of the intangible asset with its carrying value.

We performed our annual impairment review of our trade names as of September 30, 2013 using the relief-from-royalty method. The royalty rate used is based on comparable royalty agreements in the tourism and hospitality industry. The discount rate used was the same rate used in our goodwill impairment test. Based on the discounted cash flow model, we determined the fair value of our trade names exceeded their carrying value and are therefore not impaired. The fair value exceeded its carrying value by 86% as of September 30, 2013.

The estimation of fair value using discounted expected future cash flows includes numerous uncertainties that require significant judgments when developing assumptions of expected revenues, operating costs, selling and administrative expenses, capital expenditures and future impact of competitive forces. It is reasonably possible that changes in our assumptions and projected operating results used in our cash flow model could lead to an impairment of our tradename.

Ship Accounting

Upon acquisition of our ships, excluding newbuilds, we record the acquisition cost at the estimated fair value of the ship, which is calculated based on a market approach that takes into consideration recent transactions of similar ships, conditions of the cruise market at the date of valuation and the price a willing third party would pay for a ship with similar characteristics. Our ships represent our most significant asset and are stated at cost less accumulated depreciation. Depreciation of the ships is computed net of projected residual values of 30% using the straight-line method over their original estimated weighted average service lives. Service life is based on when the assets were originally placed in service. We did not extend the life of the Regent ships we acquired at the time of the Regent Seven Seas Transaction. Our service life and residual value estimates take into consideration the impact of anticipated technological changes, long-term cruise and vacation market conditions, and historical useful lives of similarly built ships.

As of January 1, 2013, we changed our estimate for all our ships’ projected residual values. The change was triggered as we obtained recent sales information for luxury cruise ship sales that occurred during the three months ended March 31, 2013. As a result, we increased each ship’s projected residual value ranging from 10-15% to 30%. The change in estimate has been applied prospectively. The effect of the change on both operating income and net loss for the year ended December 31, 2013 was approximately $16.4 million of reduced depreciation expense. We periodically review and evaluate these estimates and judgments based on historical experiences and new factors and circumstances. As part of our ongoing reviews, our estimates may change in the future. If such a change is necessary, depreciation expense could be materially higher or lower.

Improvement costs that add value to the ships and have a useful life greater than one year are capitalized as additions to the ships and are depreciated over the lesser of the ships’ remaining service lives or the improvements’ estimated useful lives. Improvement costs are related to new components that have been added to, replaced or refurbished on the ship. The remaining estimated cost and accumulated depreciation (i.e. book value) of replaced ship components are written off and any resulting losses are recognized in the consolidated statements of operations. Examples of significant capitalized improvement costs are electrical system upgrades, such as the upgrade of stabilizers, electrical system generators and the refurbishment of major mechanical systems such as diesel engines, boilers, and generators, along with new stateroom and guest facility equipment. Given the very large and complex nature of our ships, our accounting estimates related to ships and determination of ship improvement costs to be capitalized require considerable judgment of management and are inherently uncertain.

Drydock costs are scheduled maintenance activities that require the ships to be taken out of service and are expensed as incurred. Drydocks are required to maintain each vessel’s Class certification. Class certification is necessary in order for our cruise ships to be flagged in a specific country, obtain liability insurance and legally operate as passenger cruise ships. Typical drydock costs include drydock fees and wharfage services provided by the drydock facility, hull inspection and certification related activities, external hull cleaning and painting below the waterline including pressure cleaning and scraping, additional below the waterline work such as maintenance and repairs on propellers and replacement of seals, cleaning and maintenance on holding tanks and sanitary discharge systems, related outside contractor services including travel and related expenses and freight and logistics costs related to drydock activities. Repair and maintenance activities are charged to expense as incurred.

We review our ships for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be fully recoverable. The assessment of possible impairment is based on our ability to recover the carrying value of these assets based on our estimate of its undiscounted future cash flows. If estimated future cash flows are less than the carrying value of an asset, an impairment charge is recognized for the difference between the asset’s estimated fair value and its carrying value. We perform our ship impairment reviews on an individual ship basis utilizing an undiscounted cash flow analysis. The principle assumptions used in the undiscounted cash model are projected operating results, including net per diems, net cruise costs, projected occupancy, available passenger days, and projected growth. We have not recognized any impairment losses on any of our ships.

We believe our estimates and judgments with respect to our ships are reasonable. However, should certain factors or circumstances cause us to revise our estimates of ship service lives, projected residual value or the lives of major improvements, depreciation expense could be materially higher or lower. If circumstances cause us to change our assumptions in making determinations as to whether ship improvements should be capitalized, the amount we expense each year as repair and maintenance costs could increase, partially offset by a decrease in depreciation expense. If we had reduced our estimated average service life of our ships by one year, depreciation expense for 2013 would have increased by $2.9 million. If our ships were estimated to have no residual value, depreciation expense for 2013 would have increased by $30.8 million.

Contingencies—Litigation

On an ongoing basis, we assess the potential liabilities related to any lawsuits or claims brought against us. While it is typically very difficult to determine the timing and ultimate outcome of such actions, we use our best judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss, if any, can be made. In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any. We accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated. Due to the inherent uncertainties related to the eventual outcome of litigation and potential insurance recoveries, it is possible that certain matters may be resolved for amounts materially different from any provisions or disclosures that we have previously made.

Executive Overview

We reported total revenue, total cruise operating expense, operating income and net income (loss) as shown in the following table:


(in thousands, except per share data)	Year Ended December 31,
(in thousands, except per share data)	2013		2012			2011
Total revenue	$	1,183,336	$	1,112,021		$	969,138

Total cruise operating expenses	$	761,480	$	759,727		$	667,383

Operating income	$	163,161	$	105,544		$	76,684

Net income (loss)	$	35,522	$	(2,612	)	$	(69,772	)

Earnings (loss) per share
Basic	$	2.62	$	(0.19	)	$	(5.14	)

Diluted	$	1.88	$	(0.19	)	$	(5.14	)

Revenue increased $71.3 million, or 6.4%, to $1,183.3 million for the year ended December 31, 2013, from $1,112.0 million for the year ended December 31, 2012. The increase was primarily due to an increase in Net Yields and additional capacity in 2013 due to Riviera beginning revenue-generating sailings in May 2012.

Net Yield increased 4.0% to $380.58 for the year ended December 31, 2013 from $365.96 for the year ended December 31, 2012, primarily due to a decrease in air costs and air participation.

Net Cruise Cost per APCD decreased to $271.64, or 0.5%, in 2013 from $272.88 in 2012, primarily due to launch costs associated with the Riviera in 2012 as well as two drydocks in 2012 versus one in 2013. Net Cruise Cost, excluding fuel cost and other expense, per APCD increased to $215.25, or 2.2%, for the year ended December 31, 2013 from $210.60 for the year ended December 31, 2012, primarily driven by increased sales and marketing expenses.

Fuel expense, net of settled fuel hedges, increased $4.0 million to $100.9 million for the year ended December 31, 2013 from $96.9 million for the year ended December 31, 2012. The increase was driven by a 2.9% increase in consumption due to the addition of Riviera , offset by a 2.9% decrease in our average cost of fuel per metric ton.

Adjusted EBITDA was $255.8 million for the year ended December 31, 2013, compared to $227.4 million for the year ended December 31, 2012.

Results of Operations

The following table sets forth our operating data as a percentage of total revenue:


*(in thousands)*	Year Ended December 31,
*(in thousands)*	2013			2012			2011
Revenues
Passenger ticket		84.6	%		85.2	%		86.1	%
Onboard and other		13.8	%		13.6	%		13.9	%
Charter		1.6	%		1.2	%		—	%

Total revenue		100.0	%		100.0	%		100.0	%

Expenses
Commissions, transportation and other		27.4	%		29.8	%		28.0	%
Onboard and other		3.7	%		3.6	%		3.8	%
Payroll, related and food		15.0	%		15.2	%		15.9	%
Fuel		8.6	%		9.1	%		9.6	%
Other ship operating		8.3	%		8.6	%		8.9	%
Other		1.4	%		2.0	%		2.7	%

Total cruise operating expenses		64.4	%		68.3	%		68.9	%
Selling and administrative		14.8	%		13.8	%		15.0	%
Depreciation and amortization		7.1	%		8.4	%		8.2	%

Total operating expenses		86.2	%		90.5	%		92.1	%

Operating income		13.8	%		9.5	%		7.9	%

Non-operating income (expense)
Interest expense, net of capitalized interest		(12.0	)%		(11.8	)%		(10.5	)%
Interest income		0.0	%		0.1	%		0.1	%
Other income (expense)		1.1	%		2.1	%		(4.7	)%

Total non-operating expense		(10.8	)%		(9.7	)%		(15.1	)%

Income (loss) before income taxes		3.0	%		(0.2	)%		(7.2	)%
Income tax benefit (expense)		—	%		—	%		—	%

Net income (loss )		3.0	%		(0.2	)%		(7.2	)%

The following table sets forth our Passenger Days Sold, APCD and Occupancy for the years ended December 31, 2013, 2012 and 2011.


	Year Ended December 31,
	2013			2012			2011
Passenger Days Sold		1,978,998			1,873,691			1,688,958
APCD		2,094,670			1,985,522			1,836,722
Occupancy		94.5	%		94.4	%		92.0	%

In the following table, Net Per Diem is calculated by dividing net revenue by Passenger Days Sold, Gross Yield is calculated by dividing total revenue by Available Passenger Cruise Days, and Net Yield is calculated by dividing net revenue by Available Passenger Cruise Days for the years ended December 31, 2013, 2012 and 2011.


	Year Ended December 31,
*(in thousands, operating data)*	2013		2012		2011
Passenger ticket revenue	$	1,001,610	$	947,071	$	834,868
Onboard and other revenue		162,947		151,213		134,270

Total revenue, excluding charter		1,164,557		1,098,284		969,138
Less:
Commissions, transportation and other expense		323,841		331,254		271,527
Onboard and other expense		43,518		40,418		36,854

Net Revenue	$	797,198	$	726,612	$	660,757

Passenger Days Sold		1,978,998		1,873,691		1,688,958
Available Passenger Cruise Days		2,094,670		1,985,522		1,836,722
Net Per Diem	$	402.83	$	387.80	$	391.22
Gross Yield		555.96		553.15		527.65
Net Yield		380.58		365.96		359.75

In the following table, Gross Cruise Cost per Available Passenger Cruise Days is calculated by dividing Gross Cruise Cost by Available Passenger Cruise Days, and Net Cruise Cost per Available Passenger Cruise Days is calculated by dividing Net Cruise Costs by Available Passenger Cruise Days for the years ended December 31, 2013, 2012 and 2011.


	Year Ended December 31,
*(in thousands, except APCD data)*	2013		2012		2011
Total cruise operating expense	$	761,480	$	759,727	$	667,383
Selling and administrative expense		174,866		153,747		145,802

Gross Cruise Cost		936,346		913,474		813,185
Less:
Commissions, transportation and other expense		323,841		331,254		271,527
Onboard and other expense		43,518		40,418		36,854

Net Cruise Cost		568,987		541,802		504,804
Less:
Fuel		101,690		101,685		92,921
Other expense		16,416		21,968		26,305

Net Cruise Cost, excluding Fuel and Other	$	450,881	$	418,149	$	385,578

APCD		2,094,670		1,985,522		1,836,722
Gross Cruise Cost per APCD		447.01	$	460.07	$	442.74
Net Cruise Cost per APCD		271.64		272.88		274.84
Net Cruise Cost, excluding Fuel and Other, per APCD		215.25		210.60		209.93

Year Ended December 31, 2013 Compared to Year Ended December 31, 2012

Revenue

Total revenue increased $71.3 million, or 6.4%, to $1,183.3 million for the year ended December 31, 2013, from $1,112.0 million for the year ended December 31, 2012. This increase was mainly due to the following factors:

•

Passenger ticket revenue increased $54.5 million, or 5.7%, to $1,001.6 million for the year ended December 31, 2013 from $947.1 million for the year ended December 31, 2012, primarily due to additional capacity in 2013 as Riviera began revenue-generating sailings in May 2012.

•

Onboard and other revenue increased $11.7 million, or 7.8%, to $162.9 million for the year ended December 31, 2013 from $151.2 million for the year ended December 31, 2012. The increase is attributable to a $8.5 million increase in PDS and $3.2 million due to pricing increases.

•

Charter revenue increased $5.1 million to $18.8 million for the year ended December 31, 2013 from $13.7 million for the year ended December 31, 2012 due to the Insignia bareboat charter to an unrelated party for a period of two years commencing in April 2012.

Cruise Operating Expense

Total cruise operating expense increased $1.8 million, or 0.2%, to $761.5 million for the year ended December 31, 2013, from $759.7 million for the year ended December 31, 2012. The increase was attributable to the following factors:

•

Payroll, related and food increased $9.4 million, or 5.6%. The increase was due to the 5.6% increase in PDS.

•

Other ship operating increased $2.3 million, or 2.4%, primarily driven by increased deck and engine and port costs resulting from a full year of sailing for Riviera in 2013 compared to a partial sailing year in 2012.

•

Onboard and other increased $3.1 million, or 7.7%, due primarily to the 5.6% increase in PDS.

The increase was partially offset by the following factors:

•

Other decreased $5.6 million, or 25.5%, primarily due to pre-opening costs related to the Riviera launch in 2012. There were no pre-opening costs in 2013. Also, in 2012, there were two drydocks versus one drydock in 2013.

•

Commissions, transportation and other decreased $7.5 million, or 2.3%, primarily due to decreased air costs and air participation.

Selling and Administrative Expense

Selling and administrative expense for the year ended December 31, 2013 increased $21.2 million, or 13.8% to $174.9 million, from $153.7 million for the year ended December 31, 2012. The increase is attributable to selling and marketing expenses of $14.3 million and general and administrative costs totaling $6.8 million, both increases partially due to the capacity increases in 2013 and 2014.

Depreciation and Amortization Expense

Depreciation and amortization expense for the year ended December 31, 2013 decreased $9.2 million, or 9.9%, to $83.8 million from $93.0 million for the year ended December 31, 2012. Effective January 1, 2013, we increased each ship’s projected residual value resulting in a $16.4 million reduction in depreciation expense. This decrease was offset by $4.4 million in additional depreciation during 2013 on Riviera , as it was placed in service in May 2012, and the remaining balance was due to vessel refurbishment additions during drydocks in May 2012 and November 2012.

Non-Operating Income (Expense)

Interest expense, net of capitalized interest, increased $9.9 million, or 7.5%, to $141.6 million for the year ended December 31, 2013, from $131.7 million for the year ended December 31, 2012. The increase was primarily driven by the addition of the Riviera Loan (as defined herein), debt discount amortization specific to bifurcated embedded derivatives, a higher fixed interest rate under our interest rate swap agreement related to the Marina Loan (as defined herein), the refinancing of the Oceania First Lien Term Loan (as defined herein) and Oceania Second Lien Term Loan (as defined herein) in July 2013 with a loan bearing a higher average interest rate and the refinancing of the Regent Term Loan in August 2012 with a higher interest rate bearing loan.

Other income (expense) decreased $9.8 million, or 42.6%, to $13.2 million for the year ended December 31, 2013, from income of $23.0 million for the year ended December 31, 2012. For the year ended December 31, 2013, we recorded a $18.9 million gain on derivative instruments and a $0.2 million gain related to fuel hedge contracts, offset by a $3.7 million loss on the early extinguishment of Regent’s first lien term loan, a $1.9 million loss on early extinguishment of the Oceania First Lien Term Loan and a $0.3 million loss on foreign transactions. For the year ended December 31, 2012, we had a net $6.3 million gain on fuel hedges, a net $9.9 million gain of foreign currency hedges and a $15.0 million gain on a bifurcated embedded derivative. These gains were offset by a $4.6 million loss on extinguishment of debt due to the Regent financing transaction and $3.6 million of foreign transaction losses.

Net Yield

Net Yield increased 4.0% to $380.58 for the year ended December 31, 2013 from $365.96 for the year ended December 31, 2012, primarily due to a decrease in air costs and air participation.

Net Cruise Cost per APCD

Year Ended December 31, 2012 Compared to Year Ended December 31, 2011

Revenue

Total revenue increased $142.9 million, or 14.7%, to $1,112.0 million in 2012, from $969.1 million in 2011. This increase was mainly due to the following factors:

•

Passenger ticket revenue increased $112.2 million, or 13.4%, to $947.1 million in 2012, from $834.9 million in 2011, driven by a $91.0 million increase due to a 10.9% increase in PDS and $21.2 million due to pricing increases. The increase in PDS was attributable to revenue generating sailings on Riviera beginning in May 2012, and two drydocks in 2012 compared to three in 2011.

•

Onboard and other revenue increased $16.9 million, or 12.6%, to $151.2 million in 2012 from $134.3 million in 2011, driven by a $14.6 million increase due to a 10.9% increase in PDS and $2.3 million increase due to pricing increases.

•

Charter revenue increased $13.7 million due to Insignia bareboat charter in April 2012. There were no bareboat charters in 2011.

Cruise Operating Expense

Total cruise operating expense increased $92.3 million, or 13.8%, to $759.7 million in 2012, from $667.4 million in 2011. The increase was mainly due to the following factors:

•

Commissions, transportation and other increased $59.7 million, or 22.0%, primarily due to $35.7 million for higher air costs due to increased prices as well as additional capacity associated with the addition of Riviera and $6.9 million for additional product costs associated with the increased inclusive product offerings we added to our European cruise packages in light of the softer European market, while $17.1 million of the increase and costs associated with increased revenues were primarily due to an increase in PDS.

•

Onboard and other increased $3.6 million, or 9.7%, due primarily to the revenue generating sailings Riviera beginning May 2012 and an increase of 10.9% in PDS.

•

Payroll, related and food increased $14.8 million, or 9.7%. The increase was driven by the addition of Riviera to our fleet in April 2012, offset by the chartering of Insignia in April 2012. The remainder is due to an increase in hotel services costs due to higher passenger volume and higher food costs per PDS, which is based on changes to the Consumer Price Index.

•

Fuel increased $8.8 million, or 9.4%, driven by a 3.3% increase in consumption due to the addition of Riviera and a 6.0% increase in our average fuel cost per Metric Ton to $734 per Metric Ton in 2012 from $692 per Metric Ton in 2011.

•

Other ship operating increased $9.8 million, or 11.4%, primarily driven by increased capacity with the addition of Riviera partially offset by the chartering of Insignia in 2012.

The increase was partially offset by the following factors:

•

Other decreased $4.3 million, or 16.5%, primarily due to expenses associated with two drydocks in 2012 compared to three in 2011.

Selling and Administrative Expense

Selling and administrative expense for 2012 increased by $7.9 million, or 5.4%, to $153.7 million from $145.8 million for 2011. The increase was primarily due to higher employee costs totaling $9.8 million, which was partially offset by a $1.1 million decrease in sales and marketing costs and a $0.8 million decrease in certain general and administrative costs.

Depreciation and Amortization Expense

Depreciation and amortization expense for 2012 increased $13.7 million, or 17.3%, to $93.0 million from $79.3 million for 2011. The increase was mainly driven by increased depreciation for the addition of Riviera in April 2012.

Non-Operating Income (Expense)

Interest expense, net of capitalized interest, increased $30.1 million, or 29.6%, to $131.7 million in 2012, from $101.6 million in 2011. The increase was primarily driven by the incurrence of the Riviera Loan (as defined herein) and additional interest expense relating to debt discount amortization specific to embedded derivatives. Additionally, in August 2012 the Regent Term Loan was refinanced with a new term loan bearing a higher interest rate margin.

Other income (expense) increased $68.9 million, or 150.0%, to $23.0 million in 2012, from a loss of $45.9 million in 2011. In 2012, we had a net $6.3 million gain on fuel hedges, a net $9.9 million gain of foreign

currency hedges and a $15.0 million gain on a bifurcated embedded derivative. These gains were offset by a $4.6 million loss on extinguishment of debt due to the Regent financing transaction and $3.6 million of foreign transaction losses. In 2011, we had a net gain of $9.2 million on fuel hedges, a net loss of $47.1 million on foreign currency hedges primarily due to the foreign currency collars for the Oceania newbuilds, and a $7.6 million loss on extinguishment of debt related to refinancing transactions.

Net Yield

Net Yield increased 1.7% to $365.96 in 2012 from $359.75 in 2011 due to higher cruise fare and onboard and other revenues. The increase in revenues were due to higher occupancy and increases in our ticket prices partially offset by additional product costs associated with the increased inclusive product offerings we added to our European cruise packages in light of the softer European market.

Net Cruise Cost per APCD

Net Cruise Cost per APCD decreased by 0.7% to $272.88 in 2012 from $274.84 in 2011. Net Cruise Cost, excluding fuel cost and other expense, per APCD increased by 0.3% to $210.60 in 2012 from $209.93 in 2011, primarily driven by increased other ship operating costs.

Liquidity and Capital Resources

The following tables summarize our net cash flows and key metrics related to our liquidity:


	Year ended December 31,									Percent Change
	2013			2012			2011			2013 vs 2012			2012 vs 2011
Net cash provided by operating activities	$	230.7		$	188.1		$	186.3			22.6	%		1.0	%
Net cash used in investing activities		(33.1	)		(539.5	)		(603.7	)		(93.9	)%		(10.6	)%
Net cash (used in) provided by financing activities		(50.7	)		343.6			447.2			(114.8	)%		(23.2	)%
Working capital deficit (1)		(213.1	)		(267.4	)		(272.7	)		(20.1	)%		(1.9	)%

(1)	Total changes in current assets and current liabilities.

Sources and Uses of Cash—Operating Activities

Net cash provided by operating activities increased by $42.6 million to $230.7 million for the year ended December 31, 2013, from $188.1 million for the year ended December 31, 2012, primarily due to an increase in net income adjusted for non-cash items (such as depreciation, amortization, stock compensation, and the change in fair value of derivative contracts) of $39.4 million and in passenger deposits of $38.3 million, offset by a decrease in other working capital of $35.1 million.

The net increase of $1.8 million in cash provided by operating activities during 2012 compared to 2011 was primarily due to a reduction in net loss adjusted for non-cash items (such as depreciation, amortization, stock compensation, and the change in fair value of derivative contracts) of $12.4 million, offset by a decrease in passenger deposits of $15.2 million and an increase in other working capital of $4.6 million.

Sources and Uses of Cash—Investing Activities

Net cash used in investing activities decreased by $506.4 million to $33.1 million for the year ended December 31, 2013, compared to net cash used in investing activities of $539.5 million for the year ended December 31, 2012. The decrease was primarily due to $431.8 million relating to the purchase of Riviera in 2012. Additionally, in 2012 we had a settlement of a foreign currency collar associated with the Riviera newbuild that resulted in the payment of $70.3 million. The decrease was offset by an increase in restricted cash of $9.5 million. There were no settled hedges for the year ended December 31, 2013.

Net cash used in investing activities decreased by $64.2 million to $539.5 million in 2012, from $603.7 million in 2011. The decrease was primarily due to lower capital expenditures in 2012 and the change in restricted cash.

Sources and Uses of Cash—Financing Activities

Net cash provided by financing activities decreased by $394.4 million to $50.8 million used in financing activities for the year ended December 31, 2013, from $343.6 million provided by financing activities for the year ended December 31, 2012. In 2013, we had $282.5 million in proceeds from debt issuance, net of debt issuance costs and original issue discount, for the Regent Term Loan and the Oceania Term Loan refinancing, offset by $329.0 million in repayments for the Oceania Term Loan refinancing and a scheduled semi-annual principal payment on the Marina Loan. In 2012, we had $805.7 million in proceeds from debt issuance, net of debt issuance costs and original issue discount related to the drawdown of the Riviera Loan and the refinancing of the Regent Term Loan offset by $443.8 million repayments of bank debt for the Regent refinancing, scheduled semi-annual principal payment and prepayments made for Marina Loan and Riviera Loan and prepayment on Oceania’s First Lien Term Loan.

Net cash provided by financing activities decreased by $103.6 million to $343.6 million in 2012, from $447.2 million in 2011. We had an additional $178.2 million in debt repayments in 2012 compared to 2011, which includes $67.2 million in prepayments on the Marina Loan and Riviera Loan. We also repaid $34.6 million on the Oceania First Lien Term Loan due April 2013.

Funding Sources and Future Commitments

As of December 31, 2013, our liquidity was $401.4 million, consisting of $286.4 million in cash and cash equivalents and $115.0 million available under our revolving credit facilities. We had a working capital deficit of $213.1 million as of December 31, 2013, as compared to a working capital deficit of $267.4 million as of December 31, 2012. Similar to others in our industry, we operate with a substantial working capital deficit. This deficit is mainly attributable to the following: (1) passenger deposits are normally paid in advance with a relatively low level of accounts receivable, (2) rapid turnover results in a limited investment in inventories, and (3) voyage-related accounts payable usually become due after receipt of cash from related bookings. Passenger deposits remain a liability until the sailing date, however the cash generated from these advance receipts is used interchangeably with cash on hand from other sources, such as our revolving credit facilities and other cash from operations. This cash can be used to fund operating expenses for the applicable future sailing, pay down our credit facilities, fund down payments on new vessels or other uses.

We have contractual obligations, of which our debt maturities represent our largest funding requirement. As of December 31, 2013, we have $2,577.6 million in future debt maturities, excluding the debt discount and the unamortized discount on related party debt of $29.7 million and $149.7 million, respectively.

The agreements governing our indebtedness contain a number of covenants that impose operating and financial restrictions, including requirements under our newbuild loan agreement that we maintain a minimum liquidity balance, a maximum total debt to EBITDA ratio, a minimum EBITDA to debt service ratio and a maximum total debt to total adjusted equity ratio, requirements under our Secured Credit Facilities that we maintain a maximum loan-to-value ratio, a minimum interest coverage ratio (applicable only to our revolving credit facilities, if drawn) and restrictions under Regent’s Senior Secured Notes and our Secured Credit Facilities on our and our subsidiaries’ ability to, among other things, incur additional indebtedness, issue preferred stock, pay dividends on or make distributions with respect to our capital stock, restrict certain transactions with affiliates and sell certain key assets, principally our ships. As of December 31, 2013, we are in compliance with all financial covenants.

Our operating companies credit agreements include various restrictions on the ability to make dividends and distributions to their parent entities and ultimately to us. The following are restricted net assets of our subsidiaries at December 31, 2013 and 2012, respectively: $600.2 million and $458.6 million.

We believe our cash on hand, expected future operating cash inflows, additional borrowings under existing facilities, our ability to issue debt securities, and our ability to raise additional equity, including capital contributions, will be sufficient to fund operations, debt service requirements, and capital expenditures, and to maintain compliance with financial covenants under the agreements governing our indebtedness, over the next twelve-month period. There can be no assurance, however, that cash flows from operations and additional fundings will be available in the future to fund our future obligations.

On February 1, 2013, Regent amended its $340.0 million Regent Credit Facility (as defined herein), consisting of the $300.0 million Regent Term Loan (as defined herein) and the $40.0 million Regent Revolving Credit Facility (as defined herein). In conjunction with this amendment, the outstanding balance of the Regent Term Loan of $296.3 million was repriced with a rate of LIBOR with a floor of 1.25% plus a margin of 3.5%. There was no change to the $40.0 million Regent Revolving Credit Facility or the maturity date of the Regent Term Loan. There was no impact on covenants, liquidity or debt capacity.

On July 2, 2013, Oceania entered into a new $375.0 million first lien credit facility (as subsequently amended, the “Oceania Credit Facility”) consisting of a $300.0 million first lien term loan (as subsequently amended, the “Oceania Term Loan”), which bears interest at a rate of LIBOR, with a floor of 1.0% plus a margin of 5.75%, and a $75.0 million revolving credit facility (the “Oceania Revolving Credit Facility”), which includes an original issue discount of 1%. The maturity date of the Oceania Term Loan is July 2, 2020 and the maturity date of the Oceania Revolving Credit Facility is July 2, 2018. As part of this financing transaction, Oceania repaid its outstanding $231.7 million Oceania First Lien Term Loan and $75.0 million Oceania Second Lien Term Loan.

Effective July 5, 2013, Regent entered into a definitive contract with Italy’s Fincantieri shipyard to build a luxury cruise ship to be named Seven Seas Explorer . Under the terms of the contract, SSC will pay approximately €343 million (approximately $471.3 million based on the applicable exchange rate at December 31, 2013) to Fincantieri for the new vessel. During July 2013, SSC made a payment of approximately $22.0 million to Fincantieri for the initial installment payment for Seven Seas Explorer .

On July 31, 2013, Regent entered into a loan agreement providing for borrowings of up to approximately $440.0 million with a syndicate of financial institutions to finance 80% of the contract cost of the Seven Seas Explorer , the settlement of related euro foreign currency hedges and the export credit agency premium. The twelve-year fully amortizing loan requires semi-annual principal and interest payments commencing six months following the draw-down date. Borrowings under this loan agreement will bear interest, at the election of Regent, at either (i) a fixed rate of 3.43% per year, or (ii) six month LIBOR plus a margin of 2.8% per year. Regent is required to pay various fees to the lenders under this loan agreement, including a commitment fee of 1.1% per annum on the maximum loan amount payable semi-annually. Obligations under the loan agreement are guaranteed by SSC and PCH. The Regent newbuild loan facility is 95% guaranteed to the lenders by Servizi Assicurativi del Commercio Estero (“SACE”), the official export credit agency of Italy.

On August 19, 2013, in connection with the construction of Seven Seas Explorer , Regent entered into a foreign currency collar option with an aggregate notional amount of €274.4 million ($377.1 million as of December 31, 2013) to limit our exposure to foreign currency exchange rates for euro denominated payments related to the ship construction contract due at the time the ship will be delivered to us. The maturity date of the foreign currency collar is June 20, 2016.

part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the Regent Term Loan within twelve months of the amendment date. There was no change to the terms of the $40.0 million Regent Revolving Credit Facility, the financial covenants or the maturity date of the Regent Credit Facility.

On February 7, 2014, Oceania amended its existing $375.0 million Oceania Credit Facility. In conjunction with this amendment, $50.3 million of the Oceania Term Loan was prepaid such that the outstanding balance on the Oceania Term Loan of $299.3 million was reduced to $249.0 million. The interest rate margin on the amended Oceania Term Loan is 4.25% compared to 5.75% on the previously existing Oceania Term Loan and the LIBOR floor remains at 1%. The amended Oceania Term Loan requires quarterly payments of principal equal to $0.6 million beginning March 2014, with the remaining unpaid amount due and payable at maturity. Borrowings under the amended Oceania Term Loan are pre-payable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the Oceania Term Loan within twelve months of the amendment date. There was no change to the terms of the $75.0 million Oceania Revolving Credit Facility, the financial covenants or the maturity date of the Oceania Credit Facility.

As a normal part of our business, depending on market conditions, pricing and our overall growth strategy, we consider opportunities to enter into contracts for building additional ships. We may also consider the sale of ships or the purchase of existing ships. We also consider potential acquisitions and strategic alliances with complementary businesses. If any of these were to occur, they would be financed through the incurrence of additional indebtedness, the issuance of additional capital contributions or through cash flows from operations.

Contractual Obligations

As of December 31, 2013, our contractual obligations with initial or remaining terms in excess of one year, including interest expense on long-term debt obligations, were:


(in thousands)	Total		Less than 1 year		1 - 3 years		3 - 5 years		More than 5 years
Interest on long-term debt (1)	$	387,116		69,043		151,275		116,905		49,893
Employment agreements (2)		8,550		4,575		3,975		—		—
Operating lease obligations		4,460		1,081		1,483		732		1,164
Maintenance contract obligations (3)		17,860		5,453		11,440		967		—
Long-term debt (4)		1,716,234		95,560		191,120		472,370		957,184
Capital lease obligation (5)		17,725		1,800		3,734		3,924		8,267
Promissory notes (6)		861,332		—		—		638,985		222,347
Newbuild— Seven Seas Explorer (7)		447,881		23,573		424,308		—		—

Total	$	3,461,158		201,085		787,335		1,233,883		1,238,855

(1)

Long-term debt obligations mature at various dates through fiscal year 2024 and bear interest at fixed and variable rates. The various agreements governing our debt possess variable rate interest calculated based upon LIBOR, plus the applicable margins (the “All In Rate”). At December 31, 2013, the All In Rate was between 0.91% to 9.125% for all periods. Amounts are based on existing debt obligations and do not consider potential refinancing of expiring debt obligations. Additionally, under the loan agreement for the Seven Seas Explorer , Regent is required to pay various fees to the lenders including a commitment fee of 1.10% per annum on the maximum undrawn loan amount payable semi-annually until the delivery of the vessel and certain annual agency fees. See “Note 5. Debt” in the notes to our consolidated financial statements included elsewhere in this prospectus.

(2)	Amounts due to executive officers and key employees. See “Note 15. Commitments and Contingencies” in the notes to our consolidated financial statements included elsewhere in this prospectus.

(3)	Amounts include obligations under the maintenance agreement with Wartsila Corporation, a third party vendor for certain equipment purchases and monthly maintenance fees signed on March 1, 2012 for a term of sixty months and a software maintenance contract with a third party.

(4)	Amounts represent debt obligations with initial terms in excess of one year. The contractual obligation under long-term debt does not reflect any excess cash flow payments we may be required to make pursuant to our Secured Credit Facilities.

(5)	Amounts represent capital lease obligations with initial term in excess of one year.

(6)	Amounts represent redemption obligations relating to issued promissory notes.

(7)

Amount represents our contract with Italy’s Fincantieri shipyard to build the Seven Seas Explorer . Under the terms of the contract, SSC will pay €325.9 million or approximately $447.9 million (calculated based on the applicable exchange rate at December 31, 2013) to Fincantieri for the remaining balance of the new vessel.

On July 31, 2013, SSC entered into a loan agreement providing for borrowings of up to approximately $440.0 million to finance 80% of the construction contract for the Seven Seas Explorer , the settlement of related euro foreign currency hedges, plus the export credit agency premium. SSC is required to pay various fees to the lenders under this loan agreement, including a commitment fee of 1.10% per annum on the maximum undrawn loan amount payable semi-annually, beginning January 2014, until the delivery of the vessel. As of December 31, 2013, we did not have any outstanding borrowings under this loan agreement.

Off-Balance Sheet Arrangements

None.

Quantitative and Qualitative Disclosures About Market Risk

General

We are exposed to market risks attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We manage these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies as described below. The financial impacts of these hedging instruments are primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the amount, term and conditions of the derivative instrument with the underlying risk being hedged. We do not hold or issue derivative financial instruments for trading or other speculative purposes. Our maximum exposure to counter parties for non-performance is limited to our mark-to-market exposure. We monitor our derivative positions using techniques including market valuations and sensitivity analyses. The turbulence in the credit and capital markets has increased the volatility associated with interest rates, foreign currency exchange rates and fuel prices. However, we have taken steps to mitigate these risks such as the use of interest rate swap agreements, foreign currency swaps or collars, and fuel hedge swap agreements described below.

Interest Rate Risk

Our exposure to market risk for changes in interest rates relates to our long-term debt obligations including future interest payments. We use interest rate swap agreements to modify our exposure to interest rate fluctuations and to manage our interest expense.

In July 2011, Oceania entered into three forward starting interest rate swap agreements to hedge the variability of the interest payments related to the outstanding variable-rate debt associated with the Marina Loan. The first swap, with an amortizing notional amount of $450.0 million at inception, was effective beginning January 19, 2012 and matured on January 19, 2013. The second swap, with an amortizing notional amount of $405.4 million at inception became effective on January 19, 2013 and matured on January 19, 2014. The third swap, with an amortizing notional amount of $360.8 million at inception becomes effective January 19, 2014 and matures on January 19, 2015.

In March 2013, Oceania entered into an additional forward starting interest rate swap agreement to hedge the variability of the interest payments related to the outstanding variable-rate debt associated with the Marina Loan. The swap, with an amortizing notional amount of $300.0 million at inception, is effective beginning January 19, 2015 and matures on January 19, 2016.

Also in March 2013, Oceania entered into two forward starting interest rate swap agreements to hedge the variability of the interest payments related to the outstanding variable-rate debt associated with the Riviera Loan. The first swap, with an amortizing notional amount of $422.4 million at inception, became effective on October 28, 2013 and matures on October 27, 2014. The second swap, with an amortizing notional amount of $377.6 million at inception becomes effective on October 27, 2014 and matures on October 27, 2015.

All Oceania interest rate swaps are designated as cash-flow hedges and meet the requirements to qualify for hedge accounting treatment. The changes in fair value of the effective portion of the interest rate swaps are recorded as a component of accumulated other comprehensive income (loss) on our consolidated balance sheets. The total notional amount of interest rate swap agreements effective and outstanding as of December 31, 2013 and 2012 was $805.5 million and $427.7 million, respectively. There was no ineffectiveness recorded as of December 31, 2013.

Foreign Currency Exchange Risk

Our exposure to market risk for changes in foreign currency relates to our use of foreign currency transactions denominated in currencies other than the U.S. dollar. We use foreign currency swaps or collars to limit the exposure to foreign currency exchange rates, for euro denominated payments related to the construction of newbuilds, payments related to drydock expenses and other operational expenses.

During August 2013, Regent entered into a foreign currency collar option with an aggregate notional amount of €274.4 million ($377.1 million as of December 31, 2013) to hedge a portion of our foreign currency exposure related to the ship construction contract for of Seven Seas Explorer . The notional amount of the collar represents 80% of the contract cost of the vessel due at delivery. This foreign currency collar option was designated as a cash flow hedge at the inception of the instrument and will mature in June 2016. The change in fair value of the effective portion of the derivative was recorded as a component of accumulated other comprehensive income in the accompanying consolidated balance sheets. Ineffective portions of future changes in fair value of the instrument will be recognized in other income (expense) in the statement of operations. There was no ineffectiveness recorded as of December 31, 2013.

Fuel Price Risk

Our exposure to market risk for changes in fuel prices relates to the consumption of fuel on our vessels. We use fuel derivative swap agreements to mitigate the financial impact of fluctuations in fuel prices. As of December 31, 2013 we entered into fuel related swap agreements to hedge 495,900 barrels, or 50%, of our estimated 2014 fuel consumption and 123,300 barrels, or 12%, of our estimated 2015 fuel consumption. The fuel swaps do not qualify for hedge accounting; therefore, the changes in fair value of these instruments are recorded in other income (expense) in the consolidated statements of operations.

We have certain fuel derivative contracts that are subject to margin requirements. For these specific fuel derivative contracts, we may be required to post collateral if the mark-to-market exposure exceeds $3.0 million. On any business day, the amount of collateral required to be posted is an amount equal to the difference between the mark-to-market exposure and $3.0 million. As of December 31, 2013 and 2012, we were not required to post any collateral for our fuel derivative instruments. As of December 31, 2013, our exposure was $0.0 million. Therefore, we would have had to incur an additional mark-to-market exposure of over $3.0 million on our outstanding fuel derivative contracts in order for us to be required to post collateral.

Recently Adopted and Future Application of Accounting Standards

update clarifies that ordinary receivables are not within the scope of ASU 2011-11 and it applies only to derivatives, repurchase agreements, reverse purchase agreements and other securities lending transactions. The adoption did not materially impact our consolidated financial statements.

In February 2013, the Financial Accounting Standards Board issued ASU 2013-02 , Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. It requires an entity to present the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income, but only if the item reclassified is required under GAAP to be reclassified to net income in its entirety in the same reporting period. Entities must also cross-reference to other disclosures currently required under GAAP for other reclassification items to be reclassified directly to net income in their entirety in the same reporting period. This standard was effective beginning January 1, 2013. See Note 6. “Accumulated Other Comprehensive Income” to our unaudited consolidated financial statements included elsewhere in this prospectus for impact.

In July 2013, the Financial Accounting Standards Board issued ASU 2013-10, Inclusion of the Federal Funds Effective Swap Rate as a benchmark interest rate for hedge accounting purposes . This guidance is effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We adopted this guidance as of July 17, 2013, and it did not have a material impact on our consolidated financial statements.

BUSINESS

Our Company

Our ships have limited guest capacity per ship, ranging from 490 to 1,250 guests, and are significantly smaller than the typical 3000+ passenger ships operated by the Contemporary and Premium segment brands. Our stateroom accommodations are large and luxurious, consistent with an upscale and exclusive cruise experience, with 87% of the suites and staterooms on our ships featuring private balconies. Our onboard dining is a central highlight of our cruise experience and features multiple open seating gourmet dining venues where guests may dine when, where and with whom they wish. Our ships are staffed with a crew-to-guest ratio of approximately 1 to 1.6, further promoting a high level of service. This luxury-focused product offering drives our industry leading Net Yields. We believe our targeted focus on gourmet cuisine, high quality service and luxurious accommodations allows us to continue to grow Net Yields across our entire fleet, which allows us to experience a more consistent and predictable return on invested capital over the useful life of our ships.

successful launch of Oceania’s Marina in January 2011 and Oceania’s Riviera in April 2012. We are committed to maintaining a disciplined growth strategy to maximize shareholder value by profitably growing our business while continuing to reduce our debt and increase our return on invested capital.

For the year ended December 31, 2013, total revenue was approximately $1.2 billion, operating income was approximately $163.2 million and net income was approximately $35.5 million. These results are increases over our results for 2012 and are attributable to, among other factors, Net Yield growth and additional capacity in 2013. See “Management Discussion & Analysis – Executive Overview” for additional information regarding our financial results.

We believe EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin each provide a more complete understanding of our operating results, trends and financial performance than total revenue or net income. For the year ended December 31, 2013, Net Revenue, Adjusted EBITDA and Adjusted EBITDA Margin was $797.2 million, $255.8 million and 21.6%, respectively. When comparing our Adjusted EBITDA Margin to other cruise lines, it is important to note that our more inclusive product offering results in higher Commissions, transportation and other expense. Accordingly, we believe a more appropriate margin analysis is Net Revenue Adjusted EBITDA Margin, which is Adjusted EBITDA divided by Net Revenue, which was 32.1% for the year ended December 31, 2013. See “Prospectus Summary— Summary Consolidated Financial Information” for a reconciliation of net income to Adjusted EBITDA.

Our Brands

Oceania

Oceania provides an Upper Premium midsize ship cruise experience designed primarily for affluent baby- boomers. The line positions itself as the affordable cruising alternative between the Luxury ($500 plus per person per diems) and Premium ($150 to $250 per person per diems) segments of the cruise industry. Affluent guests, who historically have been loyal cruise customers on small and midsize ships, have seen the number of these type of ships diminish in recent years as the major cruise operators have focused on building ever larger ships (2500+ passengers) in the Premium cruise category.

In 2011 and 2012, Oceania took delivery of the first two O-Class vessels, Marina and Riviera , with a capacity of 1,250 guests each. We believe the O-Class ships are the world’s finest vessels designed and purpose- built for the Upper Premium market, expanding upon the popular elements featured on Oceania’s original fleet of vessels, with an emphasis on large suites and staterooms and an exceptional epicurean experience. The overall mix of suite and balcony stateroom accommodations on the O-Class ships of 95% positions these vessels to generate higher Net Yields than the R-Class ships, with 68% balcony staterooms.

Oceania is ranked as one of the world’s best cruise lines by Condé Nast Traveler , Travel + Leisure , and Cruise Critic . Oceania ships received “Best Dining,” “Best Public Rooms” and “Best Cabins” from Cruise Critic Cruisers’ Choice Awards in 2013. For 2014, Ocean & Cruise News awarded Riviera “Ship of the Year” and in 2012 Marina received the same award. These awards are industry-wide and usually determined based on each publications’ members, readers or editorial staff votes.

Regent

Regent focuses on providing guests with a high level of personal service, imaginative world-wide itineraries, unique shore excursions and land tours, world-class accommodations and top-rated cuisine. During 2013, Regent won the “Best for Luxury” award from the Cruise Critic Editor’s Pick Awards and was honored with the “World’s Best Service” award from Travel + Leisure . In 2013, Regent’s Seven Seas Voyager was awarded “Ship of the Year” from Ocean & Cruise News and in 2012 was also awarded “Best Cabins” by Condé Nast Traveler Reader’s Choice Awards . These awards are industry-wide and usually determined based on each publications’ members, readers or editorial staff votes.

Our Industry

We believe that the cruise industry demonstrates the following positive fundamentals:

Multiple Segments


			Upscale segment
Segment	Contemporary	Premium	Upper Premium	Luxury
Berths	1,700 – 5,000+	1,300 –3,500+	684 – 1,250	200 – 1,070
Per Diem	$100 – $150	$150 – $250	$250 – $400	$500+
Pricing Model	A la carte	A la carte	A la carte	Inclusive
Length of Cruise	7 days or less	7 – 14 days	10 – 180 days	7 –136+ days
Description	• Largest segment (~50% of market) • Larger ships with fixed dining and focus on onboard activities • Often the choice of first time cruisers	• Accounts for ~30% of market • Somewhat smaller ships with larger cabins and higher levels of service • Still appealing to broad market	• Unique combination of quality and value through midsized vessels • Destination-oriented cruises • Caters to the more experienced, affluent customer segment	• Ultra luxury and personalized service for affluent, experienced cruisers at industry leading per diems • Itineraries are extensive and unique • All-inclusive offering

Strong Growth with Low Penetration and Significant Upside

offerings in the Contemporary to Luxury segments to suit the various preferences of vacationing consumers of all ages, wealth levels and nationalities. Based on a 2011 CLIA market profile study, approximately 24% of the U.S. population has cruised at least once, with 11% having cruised within the last three years . Additionally, CLIA estimates that during 2013, over 17 million passengers went on a CLIA North America member cruise, an increase of 3.9% over the preceding year. According to CLIA, the number of cruise passengers has increased each year since 1995, as cruising has evolved from a niche vacation experience to a leisure holiday with broad appeal across all demographic groups. Despite this consistent growth, we believe the cruise industry still has low penetration levels compared to similar land-based vacations and highlights the continued growth potential for ocean going cruising. The future growth of the Contemporary and Premium segments, along with the normal aspirational life cycle of consumer preferences, is especially important for our company, because the vast majority of our first time guests are not first time cruisers. Accordingly, increases in the number of guests in the Contemporary and Premium segments will increase the pool of potential first time guests for our two brands.

The chart below shows annual passenger growth based on CLIA’s North American member cruise lines.

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Source: CLIA

Attractive Demographics of Target Market

High Barriers to Entry

International Growth in Emerging Markets

Our Competitive Strengths

We believe that the following business model attributes enable us to successfully execute our strategy:

High Quality Fleet

Our ships are consistently ranked among the best in the industry. Our accommodations are large and luxurious with 87% of our staterooms and suites featuring private balconies. Capacity per ship is limited and ranges from 490 to 1,250 guests, providing each guest a unique and highly personalized experience, with space ratios of 44.26 to 68.68, which are among the highest in the industry. Our cruises are staffed at a crew-to-guest ratio of approximately 1 to 1.6, further promoting a high level of personalized service. Seven Seas Mariner and Seven Seas Voyager feature all suite, all balcony accommodations. Marina and Riviera, 95% of whose accommodations feature balconies, feature suites designed and furnished by Ralph Lauren Home and noted interior designer Dakota Jackson. We expect delivery of our newbuild Seven Seas Explorer in the summer of 2016, which we believe will be the most luxurious ocean-going ship ever built .

Differentiated Product Offering

venues where guests may dine when, where and with whom they wish. We continue to receive awards for our onboard dining, and in 2013 received “Best Dining” from Cruise Critic Cruisers Choice Awards. We also feature the only hands-on instructional culinary centers at sea onboard Oceania’s Marina and Riviera. Our spa facilities on each vessel feature the highly renowned Canyon Ranch SpaClub ^® . We believe that these high quality product offerings positions us well compared to other cruise operators and provides us with the opportunity to continue growing our capacity and Net Yields.

Loyal and Repeat Customer Base

Experienced Management Team and Shareholder

Our principal shareholder and sponsor Apollo has experience investing in the cruise, leisure and travel related industries. Apollo is a leading global alternative asset manager. In addition to holding a controlling interest in us, Apollo is a significant shareholder and controls the board of Norwegian Cruise Line Holdings Ltd., one of the leading global cruise line operators, with which we indirectly compete as a cruise operator. Apollo also has current investments in other travel and leisure companies, including Caesars Entertainment and Great Wolf Resorts, and has in the past invested in Vail Resorts, Wyndham International and other hotel properties. While we are not currently aware of any conflicts of interest Apollo has related to these investments, such conflicts of interest may arise in the future. See “Risk Factors—Risks Related to Our Business—Our sponsor controls us, and the interests of our sponsor may conflict with or differ from our interests or the interests of our public shareholders.”

Cash Flow Generation

Superior Value Proposition

onboard spending for items that would be included in our ticket price, these passengers are currently paying per diems similar to what we charge, but in our opinion, receive a lower quality product, with inferior cuisine, standard itinerary offerings, diminished personalized service due to significantly higher crew-to-guest ratios and markedly lower space ratios. According to our research, there are over 23,000 large balcony staterooms measuring over 200 square feet in the North American cruise industry. Our market share of this type of stateroom was approximately 10% in 2013. We believe our brands are well positioned for future capacity growth given each brand’s market position and strong value proposition.

Our Business Strategy

The following are the key components of our business strategy:

Disciplined Growth

High Visibility and Differentiated Revenue Management Strategy

Focus on Occupancy and Maximize Net Yields

We concentrate on improving our early booking occupancy rates to drive higher Net Yields. We execute targeted and high frequency marketing campaigns that communicate a distinct message of our differentiated value- packed cruise offerings in both North American and select international markets. To increase the effectiveness of our targeted marketing programs, we recently transformed our Miami call center from an inbound-only reservation center to one that also makes outbound calls to high potential targeted customers. This dual prong strategy allows us to maximize the revenue potential from each customer contact (“leads”) generated by our various marketing campaigns. We expect that this strategic change and other initiatives in our sales organization and distribution channels will help drive sustainable growth in the number of guests carried and in Net Yields achieved.

Conversely, we have a small but increased number of elderly guests who prefer to travel as “singles,” or one to a stateroom. Because 100% occupancy is based on two persons in a stateroom, we tend to report occupancies that are somewhat lower than those of the Premium and Contemporary cruise lines, while still sailing close to full in terms of cabin occupancy.

Improve Operating Efficiency and Lower Costs

Expand and Strengthen Our Product Distribution Channels

•

Retail/Travel Agent . We make substantial investments to facilitate our travel agent partners’ success with improvements in booking technologies, transparent pricing strategies, effective marketing tools, improved communication and cooperative marketing initiatives. We have also implemented automated communication, training and booking tools specifically designed to improve our efficiency with the travel agency community and our guests including aggressive call center quality monitoring. We have sales force teams dedicated to each of our two brands who work closely with our travel agency partners on maximizing their marketing and sales effectiveness through product training, education and the sharing of “best-practices.”

•

Meetings, Incentives and Charters . This channel focuses on full ship charters as well as partial ship groups for corporate meeting and incentive travel. These sales often have very long lead times and can fill a significant portion of a ship’s capacity, or even an entire sailing, in one transaction. In addition, full ship charters and/or large groups strengthens base-loading, which allows us to fill a particular sailing earlier than usual which in turn allows us to reduce sales and marketing spend on both the sailing with the large group as well as surrounding sailings.

Our Fleet

Regent currently operates three six-star luxury cruise ships, Seven Seas Navigator, Seven Seas Mariner and Seven Seas Voyager , with 1,890 berths in aggregate , featuring world-class accommodations and amenities. Regent operates at a maximum capacity of 689,850 capacity days. Capacity on each ship is limited and ranges from 490 to 700 guests and cruises are staffed at a crew-to-guest ratio of approximately 1 to 1.5. All ships offer all-suite accommodations with 90-100% of the suites featuring private balconies. Delivery of the 750 guest newbuild, Seven Seas Explorer, is expected in the summer of 2016. The all-suite, all-balcony Seven Seas Explorer will feature sophisticated designer suites ranging from 300 square feet to 3,500 square feet with an industry leading space ratio of 76.0 and a crew-to-guest ratio of 1 to 1.4. The ship will include six open-seating gourmet restaurants, Regent’s signature nine-deck open atrium, a two-story theater, two boutiques and an expansive Canyon Ranch SpaClub ^® . Upon delivery of the Seven Seas Explorer , Regent will be the world’s largest luxury cruise line.


	Marina, Riviera	Regatta, Insignia, Nautica	Seven Seas Explorer	Seven Seas Voyager	Seven Seas Mariner	Seven Seas Navigator
Berths	1,250	684	750	700	700	490
Balconies	95%	68%	100%	100%	100%	90%
Gross tonnage	66,084	30,277	57,000	42,363	48,075	28,803
Space ratio (1)	52.86	44.26	76.00	60.52	68.68	58.78
Accommodations (sq ft)	174-2,000	160-982	300-3,500	350-1,403	301-2,002	301-1,173
Crew-to-guest ratio	1:1.6	1:1.7	1:1.4	1:1.6	1:1.6	1:1.4
Country of registry	Marshall Islands	Marshall Islands	Marshall Islands	Bahamas	Bahamas	Bahamas
Restaurants	6	4	6	4	4	3
Year built	2011, 2012	1998, 1998, 2000	(2)	2003	2001	1999

(1)	Space ratio refers to a unit of enclosed space per passenger on the ship measured in cubic feet, and represents gross tonnage divided by the number of double occupancy berths.

(2)	The Seven Seas Explorer is currently under construction, with delivery expected in the summer of 2016.

Our Destinations

We deploy our fleet to worldwide destinations, allowing our brands to meet our customers’ demands for a global and differentiated travel experience. Our cruises feature worldwide itineraries that visit approximately 350 ports each year, including destinations such as Scandinavia, Russia, the Mediterranean, the Greek Isles, Alaska, Canada and New England, Asia, Tahiti and the South Pacific, Australia and New Zealand, Africa, India, South America, the Panama Canal, and the Caribbean.

The following map displays a subset of our global destinations.

LOGO

These destination-focused itineraries, complemented by a comprehensive shore excursion program (which is included in the all-inclusive fare for cruises on the Regent ships), differentiate our brands from many of our competitors. We call on “must-see” and exotic destinations, many of which include overnight stays in port, allowing guests to have more in-depth experiences than would otherwise be possible in only a single day port call.

Oceania operates cruises primarily 10, 12 and 14 days in length, with a number of itineraries that last between 20 and 180 days, primarily offered during the winter season in North America. Regent also offers several longer itineraries of up to 136 days, which is a staple of the Luxury segment. At the same time, Regent has expanded its addressable market and captured guest spending for a greater portion of their cruising life cycle by selling segments of these longer itineraries as shorter cruises ( i.e. , which last seven to 14 day) designed for more time-constrained customers. The deployment flexibility created by the use of longer itineraries translates off-peak seasons into more profitable portions of longer cruises.

Our multi-faceted operating strategy is aimed at experiences for our travelers onboard and onshore, which are highly tailored to the individual while optimizing operational efficiencies. Given the relatively small size of our ships, we are able to access a greater number and variety of ports around the globe. We deploy the fleet to seasonal destinations, allowing us to service our guests’ demands for a global and differentiated travel experience while limiting our reliance on and exposure to one specific region.

Onboard Services and Programs

Oceania distinguishes itself by an onboard product which heavily emphasizes the culinary experience. Oceania has engaged Master Chef Jacques Pepin as its Executive Culinary Director. Pepin has cooked for several French heads of state and is known worldwide as one of the finest chefs of the modern era. Oceania also focuses on both comfort and service, with staff trained to deliver personalized and attentive service in a country club casual setting.

Regent distinguishes itself by its comprehensive all-inclusive onboard and onshore offerings and the onboard service designed to anticipate our guests’ needs. The core of the Regent guest experience centers on the ability to offer various options throughout our guests’ cruise and to have our guests’ needs met in a relaxed

atmosphere. We continually strive for innovative ways to enhance the onboard experience through new offerings. For example, we added top-shelf open bars, unlimited shore excursions and pre-cruise hotel packages as part of our all-inclusive product offering.

Onboard and Shore Excursion Program

We strive to make our guests feel more like seasoned travelers instead of tourists by innovating the traditionally uniform and regimented nature of cruising to make it fully customized and experiential. This aim is reflected in our onboard and onshore activity offerings, which include a wide variety of onboard personal enrichment programs featuring expert guest lecturers. These lecturers often have first-hand knowledge of the locales on an itinerary and come from diverse backgrounds including the United States Foreign Service, leading universities, the arts and journalism. All of these programs enrich the passenger experience and round out our portfolio of onboard offerings to address the varied interests and discriminating tastes of our guests. In the diverse world of upscale travel, we believe that we continue to differentiate ourselves and drive customer loyalty by providing such unique experiences.

Food and Dining

An important aspect of the dining experience aboard our ships is the diversity and quality of our selections as well as our open seating dining. Unlike large cruise ships, where dining times and tables are typically assigned in advance, guests on our ships may choose from a variety of onboard restaurants. There are three to four distinctive restaurants on Regent, four on the Oceania R-Class ships and six on the Oceania O-Class ships. Each restaurant’s open seating policy allows our guests the freedom to dine whenever, wherever and with whomever they wish.

We also offer complimentary 24-hour room service, allowing guests the option of enjoying a private dinner in suite or on their private balcony. On Regent, top-shelf open bar is included in the all-inclusive fare and can be enjoyed at the onboard restaurants, in any of the bars or as part of the 24-hour room service.

Other Onboard Amenities

Our ships feature a spa, wellness and fitness facility and full-service beauty salon operated by Canyon Ranch. The Canyon Ranch SpaClub ^® offers all the most popular spa treatments and physical facilities, such as body and skin-care treatment rooms, a well-equipped gym and weight room with cardio and weight training equipment, a juice bar, men’s and women’s locker rooms, thalassotherapy and sauna and steam rooms. We also serve a full range of Canyon Ranch’s Spa Cuisine for breakfast, lunch and dinner at the main dining rooms, casual dining venues, poolside and on the 24-hour room service menu for in-suite dining. On select voyages, Canyon Ranch healthy living experts offer onboard presentations and workshops addressing lifestyle change, healthy living and stress management.

Evening entertainment onboard our ships includes a nightclub with live music, a show lounge featuring a variety of production shows from Broadway revues to classical concerts and a casino. Each ship also includes a well-stocked library, an outdoor pool deck, an internet café, paddle tennis and a jogging track. Shopping is available at several onboard duty-free boutiques.

Pre- and Post-Cruise Activity / Guest Services

We are equipped to handle virtually all aspects of guest reservations and transportation requirements. A significant number of our guests elect to take advantage of our free air program, which includes a comprehensive package of air, meet and greet services and ground transfer to and from the ship. We also offer guests the opportunity to purchase pre- and post-cruise hotel accommodations and excursion packages.

Loyalty Program

We maintain loyalty programs designed to cultivate long-term customer relationships with our customers. The Oceania loyalty program, Oceania Club, and Regent loyalty program, Seven Seas Society ^® , collectively

cover more than 400,000 households. The programs have evolved to offer a range of guest rewards tailored to customer preferences, including select cruise fare and onboard services discounts, onboard recognition, and additional amenities awarded in proportion to a member’s number of nights onboard.

The programs offer significant value to us, both directly and indirectly. Program members act as ambassadors for our brands, conveying the benefits of the platform to potential customers. In addition, repeat cruisers tend to reserve future cruises farther in advance than first-time cruisers, giving us earlier insight into future booking revenue. The program bases are extremely active, with members re-qualifying themselves frequently. Acquisition costs for our past guests are much lower than new guests, in part because after experiencing our world-class product, such individuals are simply more likely to return as compared to similar individuals without prior cruise experience on our brands. Customer loyalty is an important driver of our business and, on a Passenger Days Sold basis, repeat guests accounted for 832,259 and 799,408 for 2013 and 2012, respectively.

Sales and Marketing

We have a U.S.-based sales team of 70 people as of December 31, 2013, including three representatives dedicated to Charter & Incentive (“C&I”) and three international account managers that collectively oversee important strategic relationships and develop marketing plans and budgets for marketing campaigns across key accounts. In addition to the U.S.-based sales team, we have a UK-based sales team consisting of 17 people as of December 31, 2013. This combined team sells our cruises to more than 4,250 producing travel agents, C&I clients and tour operators. We also utilize onboard sales consultants to directly book current passengers for their next itinerary. Additional international revenue comes from general sales agents located throughout the world, with the majority coming from Australia, Germany, Spain and Mexico.

We are also focused on increasing our sales and marketing efforts to complement our existing travel agency relationships which gives us the flexibility to adapt to changing market conditions. We have an outbound call center located at our corporate headquarters in Miami, Florida, with 37 sales agents focused on optimizing leads created by other marketing programs and following up directly with potential future guests. This strategic business unit offers attractive occupancy growth potential as a sales generator.

Our sales efforts are supported by a robust and targeted marketing platform. We place a strong focus on product innovation, not only for stimulating repeat business, but also for driving new demand for our products, and our marketing effort supports that focus. Innovations in online capabilities provide more efficient methods for communicating with past and prospective guests, including the integration of print and online marketing efforts, which increase efficiencies and product exposure.

Ship Operations

Crew and Staff

Best-in-class guest service levels are paramount in the Upscale market, where travelers have discriminating tastes and high expectations for service quality. We have dedicated increasing attention and resources to ensure that our service offerings meet the demands of our guests. Among other initiatives, we have implemented rigorous onboard training programs and HR and career development resources. In addition, to ensure that guests receive highly personalized service and attention to detail, we staff our ships to offer crew to guest ratios that range from 1 to 1.4 to 1 to 1.6, which is among the highest in the industry. We believe that our dedication to anticipating and meeting our guests’ every need differentiates our operations and fosters close relationships between our guests and crew, helping to build customer loyalty.

Logistics and Technology

Sophisticated and efficient maintenance and operations systems support the technical superiority and modern look of our fleet. We created a department to manage deck and engine operations in-house for both

brands, which has resulted in higher quality maintenance and better cost control. Additionally, we have purchased source code from our reservation system developer to allow us more functionality and the ability to enhance the code to meet our increasing business needs.

Ship Maintenance

Each of our ships is taken out of service as necessary for a period of approximately ten days for scheduled maintenance work, repairs and improvements that are performed in drydock. We have regulatory requirements that require our ships to drydock periodically. Drydocks are typically performed during off-peak demand periods to minimize the effect on revenues.

Seasonality

The seasonality of the cruise industry generally results in the greatest demand for cruises during the summer months of the third quarter. This predictable seasonality in demand has resulted in quarterly fluctuations in our revenue and results of operations, which we expect will continue in the future.

Employees

As of December 31, 2013, we had a total of 1,612 employees, comprised of 992 officers and crew members onboard our fleet and 620 shoreside employees. We also utilize the services of a third party to provide additional hotel and restaurant service employees onboard our ships.

Insurance

We maintain marine insurance on the hull and machinery of our ships, which are maintained in amounts related to the estimated market value of each ship. The coverage for each of the hull and machinery policies is maintained with syndicates of insurance underwriters from the European and U.S. insurance markets.

In addition to the marine insurance coverage in respect of the hull and machinery of our ships discussed above, we seek to maintain comprehensive insurance coverage at commercially reasonable rates and believe that our current coverage is adequate to protect against most of the accident-related risks involved in the conduct of our business. We carry:

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protection and indemnity insurance (that is, coverage for passenger, crew and third-party liabilities) on each ship, including insurance against risk of pollution liabilities;

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war risk insurance, including terrorist risk insurance, on each ship in an amount equal to the total insured hull value, subject to certain coverage limits, deductibles and exclusions. The terms of our marine war risk policies include provisions where underwriters can give seven days notice to the insured that the policies will be canceled, which is typical for policies in the marine industry;

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insurance for cash onboard;

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insurance for our shoreside property and general liability risks; and

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cyber insurance (privacy liability and network security insurance), which provides coverage for theft of personally identifiable non-public information in computer data and hard copy form, liability arising from failure to comply with state breach-notice laws and failure to comply with our privacy policies.

All of our insurance coverage, including the coverage described above, is subject to market-standard limitations, exclusions and deductible levels. We will endeavor to continue to obtain insurance coverage in amounts and at premiums that are commercially acceptable to us.

The Athens Convention Relating to the Carriage of Passengers and Their Luggage by Sea (1974) and the Protocol to the Athens Convention Relating to the Carriage of Passengers and Their Luggage by Sea (1976) are

generally applicable to passenger ships. The United States has not ratified the Athens Convention. However, with limited exceptions, the 1976 Protocol to the Athens Convention may be contractually enforced with respect to cruises that do not call at a U.S. port. The International Maritime Organization Diplomatic Conference agreed to a new protocol to the Athens Convention on November 1, 2002 (the “2002 Protocol”). The 2002 Protocol, which will be entered into force on April 23, 2014, establishes for the first time a level of compulsory insurance which must be maintained by passenger ship operators with a right of direct action against the insurer. We believe our ship’s entries with their respective protection and indemnity associations will provide the compulsory insurance; however, no assurance can be given that affordable and secure insurance markets will be available to provide the level and type of coverage required under the 2002 Protocol.

Properties

Information about our cruise ships, including their size and primary areas of operation, estimated expenditures and financing may be found under “—Our Fleet” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.”

Our principal executive office is located in Miami, Florida. We are party to three real property leases: in Miami, Florida, where we lease 77,543 square feet for our executive office, in Omaha, Nebraska, where we lease approximately 17,641 square feet for our call center, and in Southampton, England, where we lease approximately 6,083 square feet for our international office. These leases expire at various times through 2022, subject to renewal options. We believe that our facilities are in good condition and are adequate for our current needs, and that we are capable of obtaining additional facilities as necessary.

Trademarks

Under our ships operating under the Oceania brand, we own a number of registered trademarks in the United States and in foreign jurisdictions relating to, among other things, the names “Oceania Cruises,” and “Your World. Your Way,” “Regatta,” “Insignia” and the Oceania logo.

We own various U.S. and foreign trademark registrations, including registrations covering “Seven Seas Cruises,” “Seven Seas Navigator,” “Seven Seas Mariner,” “Seven Seas Voyager” and “Luxury Goes Exploring.” We also claim common law rights in trademarks and trade names used in conjunction with our ships, incentive programs, customer loyalty program, and specialty services rendered on board our ships.

The Regent ships have been operating under the Regent brand since 2006. In connection with the Regent Seven Seas Transaction, we entered into a trademark license agreement with Regent Hospitality Worldwide, Inc. granting us the right to use the “Regent” brand family of marks, which we amended in February 2011. The amended trademark license agreement allows Regent to use the Regent trade name, in conjunction with cruises, in perpetuity, subject to the terms and conditions stated in the agreement. In consideration for the rights and privilege to use the license under this agreement, Regent paid the licensor approximately $9.1 million.

Legal Proceedings

We are routinely involved in claims typical within the cruise industry. The majority of these claims are covered by insurance and, accordingly, the maximum amount of our liability is typically limited to our deductible amount. We believe the outcome of such claims in the aggregate, net of expected insurance recoveries will not have a material adverse impact on our financial condition or results of operations.

Competition

We face intense competition from other cruise companies in North America where the cruise market is mature and developed. The North American cruise industry is highly concentrated among three companies. As of December 31, 2013, Carnival Corporation, Royal Caribbean Cruises Ltd. and Norwegian Cruise Line Holdings

Ltd. together accounted for 82% of North American cruise passenger berth capacity. We also face competition for many itineraries from other cruise operators as well as competition from non-cruise vacation alternatives.

Governmental Regulations

Maritime—General

The international, national, state and local laws, regulations, treaties and other legal requirements applicable to our operations change regularly, depending on the itineraries of our ships and the ports and countries visited. Our ships, which are registered with and regulated by the Bahamas or the Marshall Islands, are required to comply with the international conventions that govern health, environmental, safety and security matters in relation to our guests, crew and ships. Regulatory authorities in the Bahamas and the Marshall Islands conduct periodic inspections or appoint ship classification societies to conduct periodic inspections on their behalf to verify compliance with these regulations. In addition, requirements of the European Union (“EU”), the United States and the other international ports that our ships visit apply to some aspects of our ship operations.

Our ships are also subject to periodic class surveys by ship classification societies, including drydock inspections, to verify that they have been maintained in accordance with the rules of the classification societies and that recommended maintenance and required repairs have been satisfactorily completed. Class certification is required for our cruise ships to be flagged in a specific country, obtain liability insurance and legally operate as passenger cruise ships. Drydock frequency is a statutory requirement controlled under the International Convention for Safety of Life at Sea (“SOLAS”). Our ships qualify to drydock once or twice every five years. Drydock, which requires that the ship be temporarily taken out-of-service, typically lasts for an average of ten days. Significant drydock work includes repairs, maintenance, ship improvement projects and hull inspection and related activities, such as pressure cleaning and bottom painting, and maintenance of steering gear equipment, stabilizers, thruster equipment and tanks.

As noted above, our ships are subject to inspection by the port regulatory authorities in the various countries that they visit. Such inspections include verification of compliance with the maritime safety, security, environmental, customs, immigration, health and labor regulations applicable to each port as well as with international requirements. For example, in U.S. ports, these authorities include the U.S. Coast Guard, U.S. Customs and Border Protection and U.S Public Health, and in Canada, such authorities include the Canadian Coast Guard and Public Health Agency of Canada. In EU ports, the Paris Memorandum of Understanding authorizes the enforcement of internationally accepted conventions through Port State Control inspections by the relevant authorities. For example, in Italian ports, these authorities include the Italian Coast Guard, Maritime Health and the State Police. In U.K. ports, these authorities include the Maritime and Coastguard Agency, the Department for Transport’s Transport Security team, and the Port Health Authority. Similar Memoranda of Understanding govern Port State Control inspections of our ships in most other areas of the world where we operate.

Maritime—Safety

The International Maritime Organization (“IMO”), a specialized agency of the United Nations, has adopted safety standards as part of SOLAS, which apply to all of our ships. SOLAS establishes requirements for vessel design, structural features, construction methods and materials, refurbishment standards, life-saving equipment, fire protection and detection, safe management and operation and security in order to help ensure the safety and security of our guests and crew. All of our crew undergo regular safety training exercises that meet all international maritime regulations.

SOLAS requires implementation of the International Safety Management Code (“ISM Code”), which provides an international standard for the safe management and operation of ships and for pollution prevention. The ISM Code is mandatory for passenger vessel operators. Our shoreside operations, shipboard operations and ships are regularly audited by national authorities and maintain the certificates of compliance required by the ISM Code.

Maritime—Security

Our ships are subject to various security requirements, including the International Ship and Port Facility Security Code (“ISPS Code,” a part of SOLAS); the U.S. Maritime Transportation Security Act of 2002, which addresses port and waterway security, and the U.S. Cruise Vessel Security and Safety Act, which will phase in through 2013 and applies to all of our ships that embark or disembark passengers in the United States. These maritime security regulations require that, among other things, (i) we implement specific security measures, (ii) conduct vessel security assessments, (iii) identify and deter security threats and (iv) develop security plans that may include guest, vehicle and baggage screening procedures, security patrols, establishment of restricted areas, personnel identification procedures, access control measures and installation of surveillance equipment. Our ships are regularly audited and maintain the certificates of compliance required by the ISPS Code.

Maritime—Environmental

We are subject to numerous international, national, state and local environmental laws, regulations and treaties that govern, among other things, air emissions, waste discharge, water management and disposal and the storage, handling, use and disposal of hazardous substances such as chemicals, solvents and paints. In addition to the existing legal requirements, we are committed to helping to preserve the environment, because a clean, unspoiled environment is a key element that attracts guests to our ships. If we violate or fail to comply with environmental laws, regulations or treaties, we could be fined, or otherwise sanctioned by regulators. However, more importantly preserving the environment for future generations to enjoy is our responsibility as stewards of the ocean. We have made, and will continue to make, capital and other expenditures to comply with environmental laws, regulations and treaties.

Maritime—International

The environmental convention governing ships is the IMO International Convention for the Prevention of Pollution from Ships (“MARPOL”). This convention includes requirements designed to prevent and minimize both accidental and operational pollution by oil, sewage, garbage and air emissions. Many countries have ratified and adopted IMO Conventions that, among other things, impose liability for pollution damage, subject to defenses and to monetary limits. Monetary limits do not apply where the spill is caused by the owner’s actual fault or by the owner’s intentional or reckless conduct. All of our ships must carry an International Oil Pollution Prevention Certificate, an International Sewage Pollution Prevention Certificate, an International Air Pollution Prevention Certificate and a Garbage Management Plan. These certificates and plan are issued by the ship’s state of registry and evidence their compliance with the MARPOL regulations regarding oil, sewage and air pollution prevention. In jurisdictions that have not adopted the IMO Conventions, various national, regional or local laws and regulations have been established to address these issues and/or may have more stringent requirements.

Recently adopted amendments to MARPOL will make the Baltic Sea a “Special Area” where sewage discharges from passenger ships will be restricted. We are not certain as to when these amendments are expected to enter into effect. The underlying requirements may impact our operations unless suitable port waste facilities are available, or new technologies for onboard waste treatment are developed. Accordingly, the cost of complying with these requirements is not determinable at this time, however, we do not expect it to be material.

Maritime—U.S. Federal and State

The U.S. Act to Prevent Pollution from Ships, which implements the MARPOL convention, provides for severe civil and criminal penalties related to ship-generated pollution for incidents in U.S. waters within three nautical miles and in some cases within the 200-mile exclusive economic zone.

The U.S. Oil Pollution Act of 1990 (“OPA 90”) provides for strict liability for water pollution caused by oil pollution or possible oil pollution incidents in the 200-mile exclusive economic zone of the United States, subject to defined monetary limits. OPA 90 requires that in order for us to operate in U.S. waters, we must have Certificates of Financial Responsibility from the U.S. Coast Guard for each of our ships that operate in these

waters. We have these certificates that demonstrate our ability to meet the maximum amount of OPA 90 related liability that our ships could be subject to for removal costs and damages, such as from an oil spill or a release of a hazardous substance.

The Clean Water Act of 1972 and other laws and regulations provide the U.S. Environmental Protection Agency (“EPA”) with the authority to regulate commercial vessels’ incidental discharges of ballast water, bilge water, gray water, anti-fouling paints and other substances during normal operations within the U.S. three mile territorial sea and inland waters. The U.S. National Pollutant Discharge Elimination System was designed to minimize pollution within U.S. territorial waters. For our affected ships, all of the requirements are laid out in the Vessel General Permit (“VGP”), which is an EPA requirement. The VGP establishes effluent limits for 26 specific discharges incidental to the normal operation of a vessel. In addition to these discharge and vessel specific requirements, the VGP includes requirements for inspections, monitoring, reporting and record-keeping.

Most U.S. states that border navigable waterways or sea coasts have also enacted environmental regulations that impose strict liability for removal costs and damages resulting from a discharge of oil or a release of a hazardous substance. These laws may be more stringent than U.S. federal law and in some cases have no statutory limits of liability. The state of Alaska enacted legislation that prohibits certain discharges in designated Alaskan waters and requires that certain discharges be monitored to verify compliance with the standards established by the legislation. Both the state and federal environmental regimes in Alaska are more stringent than the federal regime under the Federal Water Pollution Control Act with regard to discharge from vessels. The legislation also provides that repeat violators of the regulations could be prohibited from operating in Alaskan waters.

Maritime—EU

The EU has adopted a substantial and diverse range of environmental measures aimed at improving the quality of the environment. To support the implementation and enforcement of European environmental legislation, the EU has adopted directives on environmental liability and enforcement and a recommendation providing for minimum criteria for environmental inspections. The European Commission’s (“EC”) strategy is to reduce atmospheric emissions from seagoing ships. The EC strategy seeks to implement SOx Emission Control Areas set out in MARPOL as discussed below. In addition, the EC goes beyond the IMO by introducing requirements to use low sulfur (less than 0.1%) marine gas oil in EU ports.

Maritime—Low Sulfur Fuel

MARPOL specifies requirements for Emission Control Areas (“ECAs”) with stricter limitations on sulfur emissions in these areas. Ships operating in the Baltic Sea ECA, the North Sea/English Channel ECA and the North American ECA are required to use fuel with a sulfur content of no more than 1% or use alternative emission reduction methods, provided the alternatives are at least as effective in terms of emissions reductions. Beginning in January 2014, the area which extends approximately 50 miles off the coasts of Puerto Rico and the U.S. Virgin Islands will also become an ECA, but we do not believe this will result in a significant impact on our fuel costs. Other additional ECAs may also be established in the future, such as for areas around Australia, Hong Kong, Japan, the Mediterranean Sea and Mexico. From January 2015 and thereafter, the fuel sulfur content limit in ECAs will be further reduced to 0.1%. Compliance with these requirements will further increase our fuel costs.

The MARPOL global limit on fuel sulfur content outside of ECAs will be reduced to 0.5% from the current 3.5% global limit on and after January 2020. The 0.5% global standard will be subject to an IMO review by 2018 to determine the availability of fuel oil to comply with this standard, taking into account the global fuel oil market supply and demand, an analysis of trends in fuel oil markets and any other relevant issues. If the IMO determines that there is insufficient fuel to comply with the 0.5% standard in January 2020, then this requirement will be delayed to January 2025, at the latest. However, the European Union Parliament and Council have set 2020 as the final date for the 0.5% fuel sulfur limit to enter force, regardless of the 2018 IMO review results. This European Union Sulfur Directive will cover European Union Member State territorial waters that are within

12 nautical miles of their coastline. We believe that compliance with the 0.5% global standard could significantly increase our fuel costs. However, the magnitude of this increase is not reasonably determinable at this time due to the length of time until the global standard becomes effective and the other potential mitigating factors discussed below. The cost impacts from implementing progressively lower sulfur content requirements may be mitigated by the favorable impact of future changes in the supply and demand balance for marine and other fuels, future developments of and investments in sulfur emission abatement and propulsion technologies, including more advanced engines, more effective hull coatings and paints, exhaust gas cleaning systems and propeller design, more efficient shipboard systems, the use of alternative lower cost and lower emission fuels, such as liquefied natural gas (“LNG”) at sea and in port.

Maritime—Labor

In 2006, the International Labor Organization (“ILO”), an agency of the United Nations that develops and oversees international labor standards, adopted a new Consolidated Maritime Labor Convention (“MLC 2006”). MLC 2006 contains a comprehensive set of global standards based on those that are already found in 68 maritime labor Conventions and Recommendations adopted by the ILO since 1920. MLC 2006 includes a broad range of requirements, such as a broader definition of a seafarer, minimum age of seafarers, medical certificates, recruitment practices, training, repatriation, food, recreational facilities, health and welfare, hours of work and rest, accommodations, wages and entitlements. MLC 2006 added requirements not previously in effect, in the areas of occupational safety and health. MLC 2006 became effective in certain countries commencing August 2013. The International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (“STCW”), as amended, establishes minimum standards relating to training, certification and Watchkeeping for our seafarers.

Maritime—Financial Requirements

Our ships that call on U.S. ports are regulated by the Federal Maritime Commission (“FMC”). 46 U.S.C. 44102, which is administered by the FMC, requires all of our ships that call on U.S. ports and embark or disembark guests in U.S. ports to establish financial responsibility for their liability to passengers for nonperformance of transportation, for personal injury and for loss of life. The FMC’s regulations require that a cruise line demonstrate its financial responsibility for nonperformance of transportation through a guarantee, escrow arrangement, surety bond or insurance. In February, 2013, the FMC approved amendments to the performance bond requirements that will increase the required guarantee requirements from $15 million to $30 million per operator over a two-year period, with $22 million required guarantee as of April 2014 and $30 million required guarantee as of April 2015. Once fully effective in April 2015, the guarantee requirements will be subject to additional consumer price index based adjustments. We do not anticipate that compliance with the new rules will have a material effect on our costs.

From time to time, various other regulatory and legislative changes have been or may in the future be proposed that may have an effect on our operations in the U.S. and the cruise industry in general.

Taxation

International Shipping Income

In many of the jurisdictions in which we operate as a non-resident ship operator, the shipping revenue derived therefrom is taxed on a “deemed international shipping income” basis, meaning that the tax is levied based on a statutorily prescribed percentage of “gross shipping income” derived from the relevant jurisdictions. We believe that “gross shipping income” consists of cruise package fares received from passengers. The applicability of U.S. federal income taxes to us is separately discussed below.

Revenue from Shipboard Activities

In most countries in which we operate, tax is payable on income derived within the respective jurisdictions. We believe that the majority of the onboard revenue generated from activities such as beverage and gift shop

sales is derived while the ships are navigating in international waters. Consequently, we are of the view that onboard revenue generated from such activities is not taxable. The majority of the countries in which we operate adopt the definition of territorial waters in accordance with Article 3 of the 1982 United Nations Convention on the Law of the Sea whereby 12 nautical miles from the baseline of the respective countries is the limit for taxation purposes unless there are express domestic laws which state otherwise.

U.S. Federal Income Taxation of Regent and Oceania Shipping Income

The following discussion of the application to the Company of U.S. federal income tax laws is based upon current provisions of the Internal Revenue Code (the “Code”), legislative history, U.S. Treasury regulations, administrative rulings and court decisions. The following description is subject to change and any change could affect the continuing accuracy of this discussion (and any such change may also have retroactive effect).

Under Section 883 of the Code, certain foreign corporations, though engaged in the conduct of a trade or business within the United States, are exempt from United States federal income and branch profits taxes on (or in respect of) gross income derived from or incidental to the international operation of ships. U.S. Treasury regulations provide that a foreign corporation will qualify for the Section 883 exemption if, in relevant part: (i) the foreign country in which the foreign corporation is organized grants an “equivalent exemption” from tax for income from the international operation of ships of sufficiently broad scope to corporations organized in the U.S. (an “Equivalent Exemption”) and (ii) the foreign corporation is a “controlled foreign corporation” (a “CFC”) for more than half of the taxable year, and more than 50% of its stock is owned by qualified U.S. persons for more than half of the taxable year (the “CFC Test”). In addition, the U.S. Treasury regulations require a foreign corporation and certain of its direct and indirect shareholders to satisfy detailed substantiation requirements (“Substantiation Requirements”) in order to establish that the foreign corporation meets the CFC Test.

For purposes of the CFC Test, a qualified U.S. person is defined as an individual who is a U.S. citizen or resident alien, a domestic corporation or one of certain domestic tax-exempt trusts. Stock owned by or for a domestic partnership, taxable domestic trust, estate, mutual insurance company or similar entity is treated for these purposes as owned proportionately by its partners, beneficiaries, grantors or other interest holders.

We believe that substantially all of Regent’s and Oceania’s income derived from the international operation of ships is properly categorized as Shipping Income, and that our income other than Shipping Income is not currently, nor is it expected to become, a material amount. It is possible, however, that a material amount of our income may not actually qualify (or will not qualify) as Shipping Income.

Even if our interpretation of Section 883 is correct, the exemption for Shipping Income is not applicable in any year in which we do not satisfy complex stock ownership tests, as described above. Additionally, any change in our operations could change the amount of our income that is considered Shipping Income under Section 883. Finally, any change in the tax laws governing our operations, including Section 883 of the Code and the regulations thereunder, could increase the amount of our income that is subject to tax. Any of the foregoing risks could significantly increase our exposure to U.S. federal income and branch profits tax.

The U.S.-source portion of our income that is not Shipping Income is generally subject to U.S. federal corporate income tax on a net basis (generally at a 35% rate) and possible state and local taxes, and our effectively connected earnings and profits generally are subject to an additional branch profits tax of 30%.

For U.S. federal income tax purposes, Regent and its non-U.S. subsidiaries are disregarded as entities separate from us and Oceania is treated as a corporation. Both Regent and Oceania rely on our ability as their parent corporation to meet the requirements necessary to qualify for the benefits of Section 883. We are organized as a company in Panama, which grants an equivalent tax exemption to U.S. corporations, and is thus classified as a qualified foreign country for purposes of Section 883. We are currently classified as a CFC and we believe we meet the ownership and substantiation requirements of the CFC test under the regulations. Therefore, we believe most of

our income and the income of our ship-owning subsidiaries, which is derived from or incidental to the international operation of ships, is exempt from U.S. federal income taxation under Section 883. In 2005, final regulations became effective under Section 883, which, among other things, narrow somewhat the scope of activities that are considered by the Internal Revenue Service to be incidental to the international operation of ships. The activities listed in the regulations as not being incidental to the international operation of ships include income from the sale of air and land transportation, shore excursions, and pre- and post-cruise tours. To the extent the income from these activities is earned from sources within the United States that income is subject to U.S. taxation.

Taxation of Regent and Oceania’s International Shipping Income Where Section 883 of the Code is Inapplicable

We believe that, if the Shipping Income of Regent and Oceania were not exempt from U.S. federal income taxation under Section 883 of the Code, as described above, that income, as well as any other income from cruise operations that is not Shipping Income, to the extent derived from U.S. sources, generally would be taxed on a net basis under Section 882 of the Code (after allowance for deductions, assuming that a true and accurate federal income tax return is filed within the permitted time frame) at graduated U.S. federal corporate income tax rates (currently, a maximum of 35%), and possible state and local income taxes. We would also be subject to a 30% (unless a lower treaty rate applies) federal branch profits tax under Section 884 of the Code, generally on the portion of our earnings and profits that was derived from U.S. sources each year to the extent such earnings and profits were not properly viewed as reinvested and maintained in the U.S. business of Regent and Oceania. To the extent that our income derived from the use of our ships, or services related to the use of our ships, is not exempt under Section 883 of the Code or subject to net basis taxation under Section 882 of the Code, such income would be subject to a 4% gross basis tax under Section 887 of the Code. We believe that the income of Regent and Oceania generally would not be subject to the 4% gross basis tax under Section 887 of the Code.

Income of Regent and Oceania derived from U.S. sources includes 100% of its income, if any, from transportation that begins and ends in the United States, and 50% of its income from transportation that either begins or ends in the United States. Income from transportation that neither begins nor ends in the United States would not be taxable. There are indications in the legislative history of the transportation income source rules that suggest that a cruise that begins and ends in a U.S. port, but that calls on one or more foreign ports, will derive U.S. source income only from the first and last legs of such cruise. However, since there are no regulations or other IRS guidance with respect to these rules, the applicability of the transportation income source rules in the aforesaid manner is not free from doubt.

Certain State, Local and Non-U.S. Tax Matters

We may be subject to state, local and non-U.S. income or non-income taxes in various jurisdictions, including those in which we transact business, own property, or reside. We may be required to file tax returns in some or all of those jurisdictions. The state, local or non-U.S. tax treatment of Regent and Oceania may not conform to the U.S. federal income tax treatment discussed above. We may be required to pay non-U.S. taxes on dispositions of foreign property, or operations involving foreign property may give rise to non-U.S. income or other tax liabilities in amounts that could be substantial.

MANAGEMENT

Directors and Executive Officers

Set forth below are the names and current positions of our executive officers and Board of Directors. All ages are as of March 24, 2014.


Name	Age		Position
Directors
Frank J. Del Rio		59	Chief Executive Officer and Chairman of the Board of Directors
Adam M. Aron		59	Director
Kevin E. Crowe		31	Director
Russell W. Galbut		61	Director
Daniel M. Holtz		54	Director
Steve Martinez		45	Director
Eric L. Press		48	Director

Executive Officers and Senior Management
Robert J. Binder		49	Vice Chairman and President
Jason M. Montague		40	Executive Vice President and Chief Financial Officer
Kunal S. Kamlani		41	President of PCH and Chief Operating Officer of PCH and PCI
T. Robin Lindsay		56	Executive Vice President of Vessel Operations

Frank J. Del Rio is the founder of Oceania and has served as Chief Executive Officer and Chairman of the Board of Directors of Prestige or its predecessor since October 2002. Based in Miami, Florida, Mr. Del Rio is responsible for the financial and strategic development of Prestige. Between 2003 and 2007, Mr. Del Rio was instrumental in the development and growth of Oceania. Prior to founding Oceania, Mr. Del Rio played a vital role in the development of Renaissance Cruises, serving as Co-Chief Executive Officer, Executive Vice President and CFO from 1993 to April 2001. Mr. Del Rio holds a B.S. in Accounting from the University of Florida and is a Certified Public Accountant (inactive license). Mr. Del Rio brings a wealth of managerial and operational expertise to our Board as a result of his significant experience as CEO of our company and his long track record of success in the cruise industry.

Adam M. Aron has been a member of the Board of Directors of Prestige or its predecessor since April 2007. Since 2006, he has been Chairman of the board of directors and CEO of World Leisure Partners, Inc., a personal consultancy for matters related to travel and tourism and high-end real estate development, which acts in partnership with Apollo. Mr. Aron has previously served as Chairman of the board of directors and Chief Executive Officer of Vail Resorts, Inc. from 1996 to 2006; President and CEO of NCL Corporation Ltd. from 1993 to 1996; Senior Vice President of Marketing for United Airlines from 1990 to 1993; and Senior Vice President—Marketing for Hyatt Hotels Corporation from 1987 to 1990. Mr. Aron currently serves on the boards of directors of Cap Jaluca Properties Ltd., E-miles, Inc., Norwegian Cruise Line Holdings Ltd. and Starwood Hotels and Resorts Worldwide. Mr. Aron also serves on the boards of directors of a number of non-profit organizations. He is a member of the Council on Foreign Relations, Business Executives for National Security, and is a former member of the Young Presidents’ Organization. In addition, Mr. Aron formerly served as First Vice Chairman of the U.S. Travel Association and as Vice Chairman of the National Finance Committee of the Democratic Senatorial Campaign Committee for the 2008 election cycle. Mr. Aron was previously selected by the U.S. Secretary of Defense to participate in the Joint Civilian Orientation Conference in 2004, was appointed by the U.S. Secretary of Agriculture to serve on the board of directors of the National Forest Foundation from 2000 through 2006 and was a delegate to President Clinton’s White House Conference on Travel and Tourism. Mr. Aron received a M.B.A. with distinction from the Harvard Business School and a B.S. cum laude from Harvard College. Mr. Aron provides our Board with substantial knowledge of and expertise in the cruise, travel and hospitality industries. In addition, his directorships at other public companies provide him with broad experience on governance issues facing public companies.

Kevin E. Crowe has been a member of the Board of Directors of Prestige since December 2009. Mr. Crowe joined Apollo in 2006 and is a Principal. Mr. Crowe currently serves on the board of directors of Nine Entertainment Co Holdings, Ltd. and Norwegian Cruise Line Holdings Ltd. He previously served as a director for Quality Distribution Inc. Prior to joining Apollo, Mr. Crowe was a member of the Financial Sponsors Group at Deutsche Bank. Mr. Crowe graduated from Princeton University with an A.B. in Economics and a certificate in Finance. Mr. Crowe brings to our Board experience in the issues facing public companies and multinational businesses, and his directorships at other public companies provide him with broad experience on governance issues facing public companies.

Russell W. Galbut has been a member of the Board of Directors of Prestige or its predecessor since September 2005. Mr. Galbut currently serves as the Managing Principal of Crescent Heights, one of America’s largest and most respected residential developers of quality condominiums. Having been active in the urban mixed-use real estate sector for over 30 years, Mr. Galbut and Crescent Heights are a “best in class” developer with a successful track record of new constructions and renovations. Crescent Heights has been active in over 15 markets from coast-to-coast and has developed over 35,000 residential units, including pioneering the condo hotel concept. After graduating from Cornell University with a degree in Hotel Management, Mr. Galbut became the youngest consultant with the then-accounting firm of Laventhal Krekstein, Horwath and Horwath. Mr. Galbut was a Florida licensed CPA from 1975 to 2004. In 1980, Mr. Galbut received his J.D. degree from the University of Miami School of Law. Besides serving on the boards of directors of Prestige and Crescent Heights, Mr. Galbut also serves on the board of directors of Gibraltar Private Bank and Trust. He also sits on several other charitable boards, including the National Board of the Simon Wiesenthal Institute and Colel Chabad, the largest free food bank in Israel. Mr. Galbut provides our Board with significant expertise in accounting, legal, corporate finance and transactional matters.

Daniel M. Holtz has been a member of the Board of Directors of Prestige or its predecessor since September 2005. Since 1998, Mr. Holtz has served as Managing Principal of Walden Capital Management, a Miami-based financial services company. Mr. Holtz currently serves on the boards of directors of Verifier Capital, L.L.C. and IWM Holdings, L.L.C. He is also involved in numerous non-profit and civic organizations, including serving as member of the Board of Trustees of Holtz Center for Maternal and Child Care at Jackson Memorial Hospital in Miami, Florida, the Museum of Contemporary Art in North Miami, Florida and the Aspen Art Museum in Aspen, Colorado. Mr. Holtz holds an undergraduate degree from the University of Florida. With his experience in the financial services industry as well as his directorships on other companies, Mr. Holtz brings to our Board extensive experience managing sophisticated businesses, insight into organizational and corporate governance issues, as well as financial acumen critical to a public company.

Steve Martinez has been a member of the Board of Directors of Prestige or its predecessor since April 2007. Mr. Martinez joined Apollo in 2000 and is a Senior Partner and Head of the Asia Pacific region. He has led investments at Apollo in a variety of sectors including leisure, media, shipping and industrials, and currently serves on the boards of directors of Norwegian Cruise Line Holdings Ltd., Veritable Maritime, Nine Entertainment Co Holdings, Ltd. and Rexnord Corporation. He has previously served on the boards of directors of Allied Waste Industries, Inc., Goodman Global, Inc., Hughes Telematics Inc., Jacuzzi Brands Corp. and Hayes-Lemmerz International, Inc. Prior to joining Apollo, Mr. Martinez was a member of the mergers and acquisitions department of Goldman Sachs & Co. with responsibilities in merger structure negotiation and financing. Before that, he worked at Bain & Company Tokyo, advising U.S. corporations on corporate strategies in Japan. Mr. Martinez received a M.B.A. from the Harvard Business School and a B.A. and B.S. from the University of Pennsylvania and the Wharton School of Business, respectively. Mr. Martinez brings to our Board extensive experience in the issues facing public companies and multinational business, including expertise in management, accounting, corporate finance and transactional matters. In addition, his directorships at other public companies provide him with broad experience on governance issues facing public companies.

Eric L. Press has been a member of the Board of Director of Prestige or its predecessor since April 2007. He is a partner at Apollo, where he has worked since 1998. From 1992 to 1998, Mr. Press was associated with the law firm of Wachtell, Lipton, Rosen & Katz LLP, specializing in mergers, acquisitions, restructurings and

related financing transactions. From 1987 to 1989, Mr. Press was a consultant with The Boston Consulting Group, a management consulting firm focused on corporate strategy. Mr. Press also serves on the boards of directors of Apollo Commercial Real Estate Finance, Athene Group Ltd., Affinion Group, Inc., Caesars Entertainment Corporation, Noranda Aluminum, Inc. and Verso Paper Corp. Previously, he served on the boards of directors of Innkeepers USA Trust, Quality Distribution, Inc., Wyndham International, AEP Industries Inc. and Metals USA Holdings Corp. Mr. Press graduated magna cum laude from Harvard College with an A.B. in Economics, and from Yale Law School, where he was a Senior Editor of the Yale Law Review. Mr. Press brings to our Board extensive experience in the issues facing public companies and multinational business, including expertise in management, accounting, legal, corporate finance and transactional matters. In addition, his directorships at other public companies provide him with broad experience on governance issues facing public companies.

Robert J. Binder has served as the Vice Chairman since May 2011 and President since January 2008. He oversees the global expansion of our brands and is responsible for sales, marketing and branding efforts internationally. Mr. Binder has played a key role in the development and design of the new Oceania ships, the new restaurant concepts and the introduction of the Bon Apetit Culinary Center. He is co-founder of Oceania and previously served as President of Oceania. Before launching Oceania, Mr. Binder was the President of Meadowoods Consulting, which provided consulting services to the financial and travel services industries. From 1992 to 2001 he held several executive posts in the cruise industry. Mr. Binder has also held senior management positions at JP Morgan Chase, where he was a Strategic Planning Officer, and at Renaissance Cruises, where he was Vice President of Sales. Mr. Binder earned master’s degrees in both Finance and Marketing from Cornell University and did his undergraduate studies at Purdue University.

Jason M. Montague is the Executive Vice President and Chief Financial Officer, positions he has held since 2010. He is responsible for all day-to-day financial operations as well as the mid- and long-term strategic planning and financial development of Prestige and its two brands, Oceania and Regent. Part of Oceania’s start-up team, Mr. Montague has seen the Company through the purchase of its three R-Class vessels, the equity investment by Apollo, the financing for the Oceania-Class newbuilds and the acquisition and integration of Regent. Prior to joining Oceania, he operated a successful consulting practice focused on strategic planning and development of small to medium-sized companies. Before that, he held the position of Vice President Finance for Alton Entertainment Corporation, a brand equity marketer that was majority owned by the Interpublic Group of Companies. Mr. Montague holds a bachelor’s degree in Accounting from the University of Miami.

Kunal S. Kamlani is the President of PCH and Chief Operating Officer of PCH and PCI and has served as the President of Oceania since September 2011 and Regent since February 2013. Mr. Kamlani is responsible for revenue management, strategic marketing, sales, e-commerce, public relations and procurement for both Oceania and Regent. Mr. Kamlani rejoined us in September 2011 from Bank of America/Merrill Lynch, where he served as head of the multi-billion dollar Global Investment Solutions division with approximately 1,000 employees worldwide. Prior to that, Mr. Kamlani was Chief Financial Officer of PCH from August 2009 through March 2010. His past experiences also include serving as the Chief Operating Officer of Smith Barney and Vice President of corporate development for Starwood Hotels & Resorts. Mr. Kamlani earned his M.B.A. from Columbia University and a bachelor’s degree in Economics and Political Science from Colgate University.

T. Robin Lindsay has served as the Executive Vice President of Vessel Operations since April 2009 and oversees all marine, technical and hotel operations. Mr. Lindsay was instrumental in the extensive refurbishment and launch of Oceania’s Regatta , Insignia and Nautica and the development of the new Marina and Riviera . Mr. Lindsay possesses a substantial amount of experience in the luxury cruise industry and has overseen the design and construction of many of the industry’s most acclaimed luxury cruise ships. Prior to joining Oceania in 2003, Mr. Lindsay was the Senior Vice President of Vessel Operations at Silversea Cruises and, prior to that, Vice President of Operations at Radisson Seven Seas Cruises. Mr. Lindsay earned his B.S. degree from Louisiana Tech University.

Board of Directors

Upon the consummation of this offering, our Board will consist of directors, of whom will be independent directors.

We intend to avail ourselves of the “controlled company” exception under the rules, which eliminates the requirement that we have a majority of independent directors on our Board and that we have compensation and nominating and governance committees composed entirely of independent directors. We are required, however, to have an audit committee with one independent director during the 90-day period beginning on the date of effectiveness of the registration statement filed with the SEC in connection with this offering and of which this prospectus is part. After such 90-day period and until one year from the date of effectiveness of the registration statement, we are required to have a majority of independent directors on our Audit Committee. Beginning one year after the date of effectiveness of this registration statement, we are required to have an audit committee comprised entirely of independent directors. If at any time we cease to be a “controlled company” under the rules, our Board will take all action necessary to comply with such rules, including appointing a majority of independent directors to the Board and establishing certain committees composed entirely of independent directors.

Committees of our Board of Directors

Board Committees

Upon consummation of this offering, our Board will have three standing committees: an audit committee, a compensation committee and a nominating and corporate governance committee. The charters for each of these committees will be available on our website upon the consummation of this offering.

Audit Committee

Upon the consummation of this offering, our Audit Committee will consist of Messrs. , and . Our Board has determined that Mr. qualifies as an “audit committee financial expert” as such term is defined in Item 407(d)(5) of Regulation S-K. The purpose of the Audit Committee is to oversee our accounting and financial reporting processes and the audits of our financial statements, provide an avenue of communication among our independent auditors, management, our internal auditors and our Board, and prepare the audit-related report required by the SEC to be included in our annual proxy statement or annual report on Form 10-K.

The principal duties and responsibilities of our Audit Committee are to oversee and monitor the following:

•

preparation of annual audit committee report to be included in our annual proxy statement;

•

our financial reporting process and internal control system;

•

the integrity of our financial statements;

•

the independence, qualifications and performance of our independent auditor;

•

the performance of our internal audit function; and

•

our compliance with legal, ethical and regulatory matters.

The Audit Committee will have the power to investigate any matter brought to its attention within the scope of its duties. It will also have the authority to retain counsel and advisors to fulfill its responsibilities and duties. We intend to avail ourselves of the “controlled company” exemption under the rules, which exempts us from the requirement that we have an audit committee composed entirely of independent directors.

Compensation Committee

Upon the consummation of this offering, our Compensation Committee will consist of Messrs. , and .

The principal duties and responsibilities of our Compensation Committee are as follows:

•

to provide oversight and make recommendations to our Board on the development and implementation of the compensation policies, strategies, plans and programs for our key employees, executive officers and outside directors and disclosure relating to these matters and to establish and administer incentive compensation, benefit and related plans;

•

to review and make recommendations to our Board regarding corporate goals and objectives, performance and the compensation of our chief executive officer, chief financial officer and the other executive officers of us and our subsidiaries; and

•

to provide oversight and make recommendations to our Board concerning selection of officers, regarding performance of individual executives and related matters.

We intend to avail ourselves of the “controlled company” exemption under the rules, which exempts us from the requirement that we have a compensation committee composed entirely of independent directors.

Nominating and Corporate Governance Committee

Prior to consummation of this offering, our Board will establish a Nominating and Corporate Governance Committee. We expect that the members of the Nominating and Corporate Governance Committee will be Messrs. , and , who will be appointed to the committee promptly following this offering. The principal duties and responsibilities of the Nominating and Corporate Governance Committee will be as follows:

•

to establish criteria for board and committee membership and recommend to our Board proposed nominees for election to the Board and for membership on committees of our Board;

•

to make recommendations regarding proposals submitted by our stockholders; and

•

to make recommendations to our Board regarding board governance matters and practices.

We intend to avail ourselves of the “controlled company” exception under the rules, which exempts us from the requirement that we have a nominating and corporate governance committee composed entirely of independent directors.

Board Compensation

Our non-executive directors who hold a status as an investment professional of Apollo or a partner or senior partner with Apollo do not receive any annual retainer, meeting, committee or chair fees. Additionally, there are no automatic annual equity grants, rather grants are made from time to time as determined by our Board. Except for Mr. Aron, those non-executive directors that do not hold a status of investment professional of Apollo or partner or senior partner with Apollo receive an annual director fee of $50,000 or 5,000 stock options, at their discretion. For so long as Mr. Aron serves as a member of our Board, World Leisure Partners, Inc. will receive a $100,000 annual fee as payment for his service.

Compensation Committee Interlocks and Insider Participation

Our Compensation Committee consists of Messrs. , and . None of our executive officers serves as a member of a board of directors or compensation committee (or other committee performing equivalent functions) of any entity that has one or more executive officers serving on our Board or Compensation Committee. No interlocking relationship exists between any member of our Board or any member of the compensation committee (or other committee performing equivalent functions) of any other company.

Code of Business Conduct and Ethics

Our Board of Directors has adopted a Code of Business Conduct and Ethics that is applicable to all officers, directors and employees. Following the consummation of this offering, this Code will be available on our website.

EXECUTIVE COMPENSATION

This section identifies the material elements of compensation awarded to, earned by or paid to our executive officers identified in the Summary Compensation Table, which we refer to in this section as our “named executive officers” or “NEOs.” This section also provides a discussion of the process and rationale for the compensation decisions of the Board of Directors and its Compensation Committee and describes the role of various parties in determining our executive compensation programs.

The named executive officers for 2013 and their principal positions as of December 31, 2013 are:


Named Executive Officer		Position
Frank J. Del Rio		Chairman of the Board and Chief Executive Officer
Robert J. Binder		Vice Chairman and President
Jason M. Montague		Executive Vice President and Chief Financial Officer
Kunal S. Kamlani		President of PCH and Chief Operating Officer of PCI and PCH
T. Robin Lindsay		Executive Vice President of Vessel Operations
Mark S. Conroy		Former President of Regent Seven Seas Cruises

Executive Compensation Program Objectives and Philosophy

The Company’s executive compensation arrangements are guided by the following principles:

•

We believe that a capable, experienced and highly motivated executive management team is critical to our success and to the creation of long-term shareholder value.

•

We believe that the most effective executive compensation program is one that focuses on pay for performance and (i) rewards the achievement of annual, long-term and strategic goals and (ii) aligns the interests of our executives with those of our shareholders.

The Company’s 2013 executive compensation program was designed according to the above principles and had the primary aim of (1) attracting and retaining executives with the requisite skills and experience to help achieve our business objectives of developing and expanding business opportunities that improve long-term shareholder value and (2) encouraging executives to achieve our business objectives by linking executive compensation to Company performance and long-term shareholder value.

Our compensation approach for our named executive officers in 2013 had three key elements, designed to be consistent with the Company’s compensation philosophy and business objectives: (1) base salary; (2) annual incentive bonuses; and (3) long-term equity awards, generally subject to both time and performance-based vesting requirements. In structuring executive compensation arrangements, our Compensation Committee carefully considers how each component of our compensation program meets our business objectives.

Base salary is intended to attract and retain highly qualified executives, by providing current cash compensation commensurate with expertise, experience, tenure, performance, potential and scope of responsibility. The annual incentive bonuses motivate our executives to perform and meet our short term business goals and annual financial objectives. The equity based component of our executive compensation approach fosters a long term view of the business and helps align officer interests with shareholder interests. Further, we believe that equity awards that vest based on time enhance the stability of our senior team and provide greater incentives for our named executive officers to remain with the Company. We believe that the combination of annual fixed pay and equity ownership provides our named executive officers with an appropriate mix of guaranteed current cash compensation, allowing them to stay focused on their duties, and long term compensation, encouraging them to work toward increasing long term shareholder value.

We believe that a substantial portion of an executive officer’s compensation should be at-risk, in accordance with our compensation philosophy that links executive compensation to the attainment of business objectives and earnings performance, over the near and long term, which in turn enables us to attract, retain and reward executive officers who contribute to our success. For the named executive officers as a group, excluding Mark S. Conroy, for fiscal 2013, on an annualized basis, base salary represents 48.5% of their total target direct compensation, annual bonus and non-equity incentive compensation combined represents 44.7% of their total target direct compensation, long-term incentives (stock options) represent 6.8% of their total target direct compensation and all other compensation represents 2.3% of their total target direct compensation. The Company believes that this is an appropriate mix of fixed and variable compensation intended to incentivize our named executive officers to focus on both continued improved annual operating performance and continued long-term growth of the Company. In determining the appropriate mix of compensation components for each of our named executive officers, our Compensation Committee annually assesses, among other factors, each named executive officer’s responsibilities, prior experience and value to the Company, as well as each named executive officer’s expected level of contribution toward achieving the Company’s long-term objectives.

Compensation Setting Process

Compensation Consultants; Review of Relevant Compensation Data

Consistent with past practice, in 2013 neither our Compensation Committee nor management retained a compensation consultant to review or recommend the amount or form of compensation paid to our executive officers, including our named executive officers, or our directors. We have not adopted a policy regarding compensation consultant independence. We will consider the implementation of such a policy if and when we decide to retain a compensation consultant to assist us with our executive compensation programs in the future.

Our Compensation Committee believes that, in order to effectively attract and retain high level executive talent, each element of the compensation program should establish compensation levels that take into account current market practices. Our Compensation Committee does not “benchmark” executive compensation at any particular level in comparison with other companies. Rather, our Compensation Committee familiarizes itself with compensation trends and competitive conditions through the review of non-customized third-party market surveys and other relevant publicly available data. In setting compensation levels for 2013, after determining the types and amount of compensation based on its own evaluation, our Compensation Committee considered publicly available compensation data solely to determine the relative strengths and weaknesses of our compensation packages on an aggregate basis. Our Compensation Committee also relied on its extensive experience managing portfolio companies and considered each executive’s level of responsibility for the overall operations of the Company, historical Company practices, long-term market trends, internal pay equity, expectations regarding future named executive officer contributions, our own performance, budget considerations and succession planning and retention strategies.

Role of Executive Officers in Compensation Decisions

The Compensation Committee makes all compensation decisions related to the CEO and equity-based compensation awards. The Compensation Committee, together with recommendations and input from our CEO, sets and determines the compensation for the other named executive officers.

Compensation Risk Assessment

The Company conducted a risk assessment of our compensation policies and practices and concluded that such policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. In particular, the Compensation Committee believes that the design of our annual performance incentive program and long-term equity incentives provides a balanced approach and an effective and appropriate mix of incentives to ensure our executive compensation program is focused on long-term shareholder value creation. To strengthen the relationship between pay and performance, our annual cash incentive bonus plan and

many of our equity grants are subject to the achievement of pre-established performance goals established independently of the plan participants. In addition, a portion of such variable pay is delivered through equity awards with both time-based and performance-based vesting schedules, and performance periods covering multiple years, thus emphasizing retention and long-term company performance while discouraging the taking of short-term risks at the expense of long-term results.

Compensation Elements

The three key compensation elements for our named executive officers identified above (base pay, annual performance bonus and long-term equity awards), as well as other elements of compensation, are discussed below.

Base Salary

Base salary is intended to provide a baseline level of fixed compensation that reflects each named executive officer’s level of responsibility. Each named executive officer is party to an employment agreement that provides for a fixed base salary, subject to annual review. The initial base salary level for each named executive officer was negotiated in connection with the executive joining the Company or our affiliates or upon a change of his responsibilities. Decisions regarding adjustments to base salaries are made at the discretion of our Compensation Committee, though the salaries are generally subject only to increases, not decreases. In reviewing base salary levels for our named executive officers, the Compensation Committee annually considers and assesses, among other factors, a named executive officer’s current base salary, job responsibilities, leadership and experience, and value to our Company. In addition, as noted above, base salary levels are generally intended to be consistent with competitive market base salary levels, but are not specifically targeted or “benchmarked” against any particular company or group of companies.

The chart below indicates the annual base salary for each of our named executive officers in 2013.


Named Executive Officer	2013 Annual Base Salary
Frank J. Del Rio	$	1,597,200
Jason M. Montague	$	475,000
Robert J. Binder	$	300,000
Kunal S. Kamlani	$	900,000
T. Robin Lindsay	$	475,000
Mark S. Conroy	$	550,000

Annual Incentive Bonus

Each named executive officer, with the exception of Messrs. Kamlani and Conroy, is eligible to receive an annual cash bonus for fiscal 2013 in accordance with the Company’s 2013 management incentive compensation plan (the “MICP”), subject to the provisions of his employment agreement. The 2013 MICP provides for bonus payments upon the achievement of an EBITDA-based corporate performance goal. We use our annual incentive bonus program to incentivize and motivate our named executive officers by providing the opportunity to receive additional compensation tied to annual Company performance.

Each year, the Compensation Committee establishes the performance goal after careful review of the annual budget. For 2013, the Compensation Committee determined that the MICP bonus target would be an adjusted EBITDA of PCH and its consolidated subsidiaries, defined as earnings before interest, other income (expense), income taxes, depreciation and amortization, and MICP compensation expense adjusted for the impact from settled fuel hedges (“MICP EBITDA”). We believe the MICP EBITDA performance target is useful as it reflects certain operating drivers of our business, such as sales growth, operating costs, selling and administrative expenses and other operating income and expense. The MICP EBITDA target was $251.3 million for 2013. The

Compensation Committee reserves the right to adjust the performance goal during the course of the year to take into consideration changes in deployment of the fleet, major unforeseen and uncontrollable events and other non-recurring and extraordinary costs and revenues experienced by us during the year. For 2013, the Compensation Committee recommended, and the Board approved, that MICP EBITDA would be adjusted for certain fuel related items and certain other miscellaneous expenses.

The following chart sets forth the MICP EBITDA levels at which various levels of incentive payout would become available to our named executive officers for 2013, with the bonus percentage amounts expressed as a percentage of the named executive officer’s base salary for 2013. Between these points the payout is calculated on a sliding straight line basis. There is no maximum bonus for the named executive officers and the sliding straight line allocation between 92.5% and 100% will be applied to MICP EBITDA over 100% of performance target.


Name	Percentage of MICP EBITDA goal Achieved			Annual Incentive Bonus Percentage
Frank J. Del Rio		76.2	%		—	%
		80.9	%		15.3	%
		92.5	%		63.6	%
		100.0	%		100.0	%
Jason M. Montague		76.2	%		—	%
		80.9	%		11.5	%
		92.5	%		47.7	%
		100.0	%		75.0	%
Robert J. Binder		76.2	%		—	%
		80.9	%		13.0	%
		92.5	%		54.1	%
		100.0	%		85.0	%
Kunal S. Kamlani (1)		—	%		—	%
T. Robin Lindsay		76.2	%		—	%
		80.9	%		11.5	%
		92.5	%		47.7	%
		100.0	%		75.0	%
Mark S. Conroy (2)		76.2	%		—	%
		80.9	%		13.0	%
		92.5	%		54.1	%
		100.0	%		85.0	%

(1)

Mr. Kamlani’s minimum guaranteed bonus is not based on performance against MICP EBITDA.

(2)

The Company agreed with Mark S. Conroy on September 26, 2012 that he would step down as president of Regent on January 30, 2013. As of January 31, 2013 he was appointed as an executive adviser to the CEO and President of PCH. In connection with these arrangements, on November 9, 2012 the Company entered into a Separation Agreement and an Independent Contractor Agreement with Mr. Conroy. In connection therewith, Mr. Conroy will receive amounts to which he is entitled pursuant to his existing employment agreement.

Our fiscal 2013 MICP EBITDA was 102.7% of our performance target. As a result, Frank J. Del Rio will receive an annual bonus equal to 112.8% of his annual salary, Kunal S. Kamlani and Robert J. Binder will receive an annual bonus of 95.9% of their annual salary, Jason M. Montague and T. Robin Lindsay will receive an annual bonus of 84.6% of their annual salary and Mark S. Conroy received an annual bonus equal to 85.0% of his base salary through January 30, 2013.

In 2013, pursuant to his employment agreement, Mr. Kamlani is eligible to receive a cash bonus in an amount determined by the Board of Directors, subject to a guaranteed minimum annual bonus of $750,000. Based on the Compensation Committee’s review of Mr. Kamlani’s performance in fiscal 2013, including his guaranteed minimum annual bonus the Committee decided to award him an annual bonus equal to $862,892.

The chart below shows the annual incentive bonus that will be paid in 2014 based on services provided in 2013, except for Mark S. Conroy who was paid in 2013:


Name	Total Bonus		Bonus as % of 2013 Annual Base Salary
Frank J. Del Rio	$	1,801,582		112.8	%
Jason M. Montague	$	401,837		84.6	%
Robert J. Binder	$	287,631		95.9	%
Kunal S. Kamlani	$	862,892		95.9	%
T. Robin Lindsay	$	401,837		84.6	%
Mark S. Conroy	$	39,558		7.2	%

Long-Term Equity Incentive Compensation

We believe that long-term compensation of our executives, including our named executive officers, should be directly linked to the value provided to shareholders. Accordingly, our long-term equity incentive program is intended to directly align a significant portion of the compensation of our named executive officers with the interests of our shareholders by motivating and rewarding creation and preservation of long-term shareholder value with measurement over a multi-year performance period. In this regard, the Compensation Committee determined that stock options in Prestige is the most appropriate equity-based compensation award, as it provides value only if there is appreciation in the value of Prestige’s common stock following the date of grant, and no value if there is no such appreciation. We use a combination of time-based vesting awards (which enhance retention) and performance-based vesting (which strengthens the link between pay and performance).

Certain of our named executive officers have been granted stock options pursuant to the 2008 Stock Option Plan of Prestige (the “Prestige option plan”). Each option granted under the Prestige option plan represents the right to purchase one share of common stock of Prestige. Our philosophy is that options are granted to named executive officers when the Compensation Committee determines that it would be to the advantage and in the best interests of the Company and its stockholders to grant such options as an inducement to enter into or remain in the employ of the Company or one of its subsidiaries and as an incentive for increased efforts during such employment. The number of equity awards granted annually to our named executive officers is determined both in the discretion of the Compensation Committee and pursuant to certain agreements with certain named executive officers. Option grants to the CEO are at the discretion of the Compensation Committee, while grants to all other named executive officers are determined by the Compensation Committee after consultation with and recommendation of the CEO.

Mr. Del Rio was not granted any options in 2013, in light of the significant option grants made in 2009 in connection with the signing of his employment agreement.

Mr. Kamlani is entitled to receive time-based option grants in connection with his employment which vests in three cumulative and substantially equal installments on each of the first, second and third anniversaries of his employment for his 2012 grant and on December 31, 2013, 2014 and 2015 for his 2013 grant.

For Mr. Montague, Mr. Binder and Mr. Lindsay, fifty percent (50%) of the option grants have time-based vesting in three cumulative and substantially equal installments at the end of each calendar year of and after the grant date, provided that the named executive officer remains continuously employed in active service with the

Company or one of its subsidiaries. The remaining fifty percent (50%) of the option grants have performance-based vesting in three substantially equal installments on December 31 of each applicable performance measurement year if the applicable MICP EBITDA performance target for such year (which is the same target as used under the 2013 MICP) is satisfied. If the performance targets for any year are not satisfied, the performance based options scheduled to vest that year are forfeited. However, the Board of Directors or Compensation Committee reserves the right to vest or modify the options to the extent it determines that achievement of the performance criteria was affected by changes in deployment of the fleet, major unforeseen and uncontrollable events and other non- recurring and extraordinary costs experienced by the Company during the year.

For Mr. Conroy, as part of his Separation Agreement entered into on November 9, 2012, all of his existing option grants were either canceled or forfeited, vested options were canceled and unvested options were forfeited as of such date. Also, pursuant to his Independent Contractor Agreement, on February 11, 2013, Mr. Conroy was granted 100,000 options which vest on January 31, 2015.

The performance target for the performance-based options is the same as the MICP EBITDA target. The performance criteria for Messrs. Montague, Binder and Lindsay’s performance-based options were met, and their options based on 2013 performance vested in full on December 31, 2013.

Except as otherwise provided in a named executive officer’s employment agreement, unvested options are generally forfeited upon a termination from service, although certain option holders will also become vested in their awards in connection with certain terminations of employment. For a discussion of vesting under specific termination scenarios, see the section titled, “Potential Payments upon Termination of Employment and Change of Control” below.

Other Elements of Compensation

Benefits and Perquisites

We provide our named executive officers with the opportunity to participate in our medical, dental and insurance programs and vacation and other holiday pay, all in accordance with the terms of such plans and programs in effect from time to time and substantially on the same terms as those generally offered to our other employees or as negotiated by the named executive officer and included in their employment agreement.

In addition, certain of the named executive officers receive a cash automobile allowance, as well as Company paid long term disability coverage. The Company believes that the level and mix of perquisites it provides to the named executive officers is consistent with market compensation practices.

Severance Arrangements and Change in Control Benefits

Each of our named executive officers is employed pursuant to an employment agreement that provides for severance benefits upon an involuntary termination of the named executive officer’s employment by us, a termination by the executive as a result of a constructive termination, or in certain instances, non-renewal of an employment agreement. The severance benefit in each employment agreement was negotiated in connection with the commencement of each executive’s employment with the Company, or upon a change of their responsibilities. In each case, our Board of Directors or Compensation Committee determined that it was appropriate to provide the executive with severance and related benefits in light of his or her position with the Company, general competitive practices and as part of an overall compensation package. The severance benefits payable to each of our named executive officers upon a qualifying termination of employment generally includes a cash payment based on the executive’s base salary (and bonus, in some cases) and continued medical benefits and car allowance for the applicable severance period at the Company’s expense.

The Company does not believe that the named executive officers should be entitled to any “single-trigger” cash severance benefits merely because of a change in control of the Company. Accordingly, none of the named executive officers are entitled to any such payments or benefits upon the occurrence of a change in control of the Company, unless there is an actual or constructive termination of employment following such change in control (“double-trigger” payments). However, the employment agreements for certain executives provide for additional payments to make them whole for any excise taxes that may be imposed on them in the event of a change in control, which payments were agreed to by the Compensation Committee in connection with the negotiation of the executive’s overall compensation package, and which the Compensation Committee believes are reasonable and competitive. The material terms of such payments and benefits are described in the section titled “Potential Payments Upon a Termination or Change in Control.”

Summary Compensation Table for Fiscal 2013

The following table provides summary information concerning compensation paid or accrued during the fiscal years ended December 31, 2013, 2012 and 2011 to our principal executive officer, our principal financial officer, our three other most highly paid executive officers and our former executive officer.


Name and Principal Position	Year		Salary		Bonus		Option Awards (3)		Non-equity Incentive Plan Compensation		All Other Compensation (4)		Total
Frank J. Del Rio		2013	$	1,597,200	$	—	$	—	$	1,801,582	$	109,600	$	3,508,382
Chief Executive Officer and		2012	$	1,452,000	$	—	$	42,199	$	1,452,000	$	60,149	$	3,006,348
Chairman of the Board		2011	$	1,320,000	$	—	$	7,049	$	699,347	$	92,726	$	2,119,122

Jason M. Montague		2013	$	475,000	$	—	$	177,309	$	401,837	$	19,791	$	1,073,937
Executive Vice President and		2012	$	400,000	$	—	$	83,533	$	300,000	$	13,200	$	796,733
Chief Financial Officer		2011	$	325,000	$	—	$	40,497	$	170,466	$	15,377	$	551,340

Robert J. Binder (1)		2013	$	300,000	$	—	$	25,330	$	287,631	$	—	$	612,961
Vice Chairman and President

Kunal S. Kamlani (2)		2013	$	900,000	$	750,000	$	272,222	$	112,892	$	29,417	$	2,064,531
President of PCH and Chief		2012	$	750,000	$	750,000	$	1,374,198	$	—	$	17,246	$	2,891,444
Operating Officer of PCH and PCI		2011	$	256,849	$	500,000	$	—	$	—	$	22,547	$	779,396

Mark S. Conroy		2013	$	42,308	$	—	$	123,281	$	39,558	$	788,301	$	993,448
Former President of Regent		2012	$	550,000	$	—	$	28,588	$	467,500	$	13,200	$	1,059,288
Seven Seas Cruises		2011	$	535,000	$	—	$	40,461	$	318,028	$	13,318	$	906,807

T. Robin Lindsay		2013	$	475,000	$	—	$	25,963	$	401,837	$	13,200	$	916,000
Executive Vice President of		2012	$	450,000	$	—	$	73,925	$	164,835	$	13,200	$	701,960
Vessel Operations		2011	$	425,000	$	—	$	40,914	$	222,917	$	13,200	$	702,031

(1)	Mr. Binder first became a named executive officer in 2013.

(2)	Mr. Kamlani rejoined the Company from Bank of America/Merrill Lynch during the third quarter of 2011 and as such he did not earn his entire 2011 annualized base salary.

(3)

Represents the aggregate grant date fair value of options granted to such named executive officers in 2013, computed in accordance with FASB ASC Topic 718, disregarding any estimates of forfeitures related to service-based vesting conditions. See Note 8-Share-Based Employee Compensation, to the Company’s consolidated financial statements set forth in this prospectus for the assumptions made in determining those values.

(4)

Included within Mr. Del Rio’s “All Other Compensation” for fiscal 2013 is $62,000 personal allowances, $27,600 car allowance, and $20,000 personal tax service. Included within Mr. Montague’s and Mr. Kamlani’s “All Other Compensation” for fiscal 2013 is $13,200 car allowance and cruise benefits. Included within Mr. Lindsay’s “All Other Compensation” for fiscal 2013 is $13,200 car allowance. Mr. Conroy’s “All Other Compensation” amount for fiscal 2013 includes $550,000 severance, $137,500 consulting fees, $65,053 COBRA, $27,500 car allowance and $5,908 Long Term Care insurance premium and cruise benefits. The cruise benefit was valued on the basis of the aggregate incremental cost to the Company.

Grants of Plan-Based Awards for Fiscal 2013

The following chart provides information concerning equity awards granted in 2013 to our named executive officers.


			Estimated Future Payouts Under Equity Incentive Plan Awards (1)						Estimated Future Payouts Under Equity Incentive Plan Awards (2)						All other Option Awards: # of Securities Underlying (3)		Grant Date Fair Value of Options
Name	Grant Date		Threshold ($)		Target ($)		Maximum ($)		Threshold ($)		Target ($)		Maximum ($)		Options		Awards (4)
Frank J. Del Rio		—		—		1,597,200		—		—		—		—		—		—
Jason M. Montague				—		356,250		—		—		—		—		—		—
		2/11/13		—		—		—		—		—		—		35,000		88,654
		2/11/13		—		—		—		—		11,666		—		—		30,692
		2/11/13		—		—		—		—		11,667		—		—		29,538
		2/11/13		—		—		—		—		11,667		—		—		28,424
Robert J. Binder				—		255,000		—		—				—
		2/11/13		—		—		—		—		—		—		5,000		12,665
		2/11/13		—		—		—		—		1,666		—		—		4,383
		2/11/13		—		—		—		—		1,667		—		—		4,220
		2/11/13		—		—		—		—		1,667		—		—		4,061
Kunal S. Kamlani				—
		2/11/13		—		—		—		—		—		—		100,000		272,222
Mark S. Conroy (5)				—
		2/11/13		—		—		—		—		—		—		100,000		123,281
T. Robin Lindsay				—		356,250		—		—		—		—		—		—
		2/11/13		—		—		—		—		—		—		5,125		12,982
		2/11/13		—		—		—		—		1,708		—		—		4,494
		2/11/13		—		—		—		—		1,708		—		—		4,324
		2/11/13		—		—		—		—		1,709		—		—		4,164

(1)

Represents potential payout levels based on 2013 performance for awards granted pursuant to the 2013 MICP. There is no maximum amount payable under the 2013 MICP. Mr. Kamlani’s bonus is fully discretionary, with a minimum guaranteed bonus of $750,000. For amounts actually paid to each of the named executive officers pursuant to such awards based on results achieved in 2013, see the Summary Compensation Table column titled “Non-Equity Incentive Plan Compensation.” For a more detailed description of the potential payout under the 2013 MICP, see “Annual Incentive Bonus.”

(2)

Represents performance-based options granted to such named executive officers in 2013 pursuant to the Prestige option plan. There is no threshold or maximum performance and the options are generally forfeited if the relevant performance target is not satisfied. For a more detailed description of the performance-based options, see “Long-Term Equity Incentive Compensation.”

(3)

Represents time-based options granted to such named executive officers in 2013, pursuant to the Prestige option plan. The options vest and become exercisable in three cumulative and substantially equal installments at the end of each calendar year of the grant date, provided that the named executive officer remains continuously employed in active service with the Company or one of its subsidiaries.

(4)

Represents the aggregate grant date fair value of options granted to such named executive officers in 2013, computed in accordance with FASB ASC Topic 718, disregarding any estimates of forfeitures related to service-based vesting conditions. See Note 8-Share-Based Employee Compensation, to the Company’s consolidated financial statements set forth in this filing for the assumptions made in determining those values.

(5)	Represents time-based options granted to such named executive officer in 2013, pursuant to the Prestige option plan. The options vest and become exercisable on January 31, 2015.

Outstanding Equity Awards

At Fiscal 2013 Year-End


	Option Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable			Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)			Option Exercise Price ($)		Option Expiration Date
Frank J. Del Rio		1,000,000		—			—			8.00		7/1/2017
		216,216		—			—			9.25		1/1/2018
Jason M. Montague		15,000		—			—			40.02		6/1/2015
		15,000		—			—			40.32		4/22/2016
		7,500		—			—			8.00		3/31/2017
		25,000		—			—			8.00		12/15/2017
		55,000		—			—			10.11		38/31/2018
		12,500		—			—			9.50		1/1/2019
		20,000		5,000	(2)		5,000	(4)		4.87		2/10/2020
		23,333		23,333	(3)		23,334	(5)		5.79		2/11/2021
Robert J. Binder		45,000		—			—			40.02		6/1/2015
		40,000		—			—			40.32		4/22/2016
		50,000		—			—			8.00		12/15/2017
		50,000		—			—			10.11		3/31/2018
		3,333		3,333	(3)		3,334	(5)		5.79		2/11/2021
Kunal S. Kamlani		400,000		200,000	(6)		—			4.87		2/28/2020
		33,334		66,666	(3)		—			5.79		2/11/2021
Mark S. Conroy		—		100,000	(1)		—			8.82		1/31/2021
T. Robin Lindsay		30,000		—			—			40.02		6/1/2015
		30,000		—			—			40.32		4/22/2016
		45,000		—			—			8.00		3/31/2017
		7,500		—			—			8.00		12/15/2017
		50,000		—			—			10.11		3/31/2018
		12,500		—			—			9.50		1/1/2019
		16,500		4,125	(2)		4,125	(4)		4.87		2/10/2020
		3,417		3,417	(3)		3,416	(5)		5.79		2/11/2021

(1)	As part of Mr. Conroy’s Separation Agreement and Independent Contractor Agreement entered into on November 9, 2012, he received a grant of 100,000 options, which will vest and become exercisable on January 31, 2015 provided that he remains in compliance with the agreement.

(2)	Options will vest and become exercisable on December 31, 2014, provided that the named executive officer remains continuously employed in active service with the Company or one of its subsidiaries.

(3)	Options will vest and become exercisable ratably on December 31, 2014 and December 31, 2015, provided that the named executive officer remains continuously employed in active service with the Company or one of its subsidiaries.

(4)	Options will vest and become exercisable on December 31, 2014, subject to the achievement of the 2014 MICP EBITDA target.

(5)	Options will vest and become exercisable ratably on December 31, 2014 and December 31, 2015, if the applicable MICP EBITDA performance target for such year is satisfied.

(6)	Options will vest and become exercisable on August 29, 2014, provided that the named executive officer remains continuously employed in active service with the Company or one of its subsidiaries.

Employment Agreements

Though the employment agreements reference the boards and compensation committees of various subsidiaries and affiliates, our current practice is that compensation decisions are made by the board and/or compensation committee of PCI.

Frank J. Del Rio

The Company and Chairman and Chief Executive Officer of the Company, Frank J. Del Rio, agreed on March 22, 2013 to amend and extend Mr. Del Rio’s executive employment agreement with Prestige through December 31, 2016. The amendment modifies certain terms of his existing employment agreement. Mr. Del Rio’s annual base salary for the period July 1, 2013 through December 31, 2013 will be at a prorated rate of $1,597,200. Beginning on January 1, 2014 and for each year thereafter, Mr. Del Rio shall receive an annual base salary of $1,750,000. Effective as of March 22, 2013, Mr. Del Rio will receive a travel allowance of $30,000 per year and certain other benefits. In the event of a termination of Mr. Del Rio’s employment before the end of the term of his employment either (1) by Prestige without cause within 180 days prior to the sale of Prestige or any time thereafter, or (2) by Mr. Del Rio for good reason any time after the sale of Prestige, Mr. Del Rio is entitled to a severance equal to the sum of two years of Base Salary and targeted annual incentive bonus, and certain other benefits including continued allowance for country club dues and fees, automobile allowance, health/medical plan benefits and certain other benefits for two years.

For 2013, Mr. Del Rio is eligible for a target incentive bonus equal to one hundred percent (100%) of his then current salary, provided that the actual bonus shall be determined by the Board in its sole discretion, based on performance objectives established with respect to that year by the Board, in good faith consultation with Mr. Del Rio. In 2009, pursuant to his officer employment agreement, Mr. Del Rio received an option to purchase 216,216 shares of Prestige. Such option grant was intended as incentive compensation for 2010 and 2011, with fifty percent (50%) vesting at the end of each year, subject to continued employment and the achievement of performance objectives established by the Board. Additionally, in 2009, pursuant to his officer employment agreement, Mr. Del Rio received a time based option to purchase 1,000,000 shares of Prestige, with fifty percent (50%) vesting on the second anniversary of the grant, and then an additional twenty five percent (25%) vesting on each of the third and fourth anniversaries of the grant. As a condition to receiving such option, Mr. Del Rio was required to make an equity investment in Prestige, in the amount of $3,000,000. The agreement also provides for participation in employee benefit plans and perquisite programs generally available to similarly situated executives. In particular, Mr. Del Rio is entitled to an automobile allowance of $2,300 per month, a personal expense allowance of $12,000 per year (subject to review and upward adjustment), an allowance for country club dues and fees up to $20,000 per year (subject to review and upward adjustment), an allowance for tax advice and preparation up to $20,000 per year, business class travel and forty (40) days annual paid vacation. Mr. Del Rio is also eligible for a tax “gross up,” to make him whole in the event that an excise tax is due under Section 280G of the Internal Revenue Code in connection with payments contingent on a change in control of Prestige.

Jason M. Montague

Mr. Montague is employed as Executive Vice President and Chief Financial Officer pursuant to an employment agreement with PCS, dated January 1, 2013. The term of Mr. Montague’s original employment agreement is three years. The agreement provides for a minimum annual base salary of $475,000, which shall be evaluated for an upward adjustment annually before each compensation determination date, which shall be no later than the first quarter of the applicable fiscal year. Mr. Montague is eligible for an annual cash bonus in an amount to be determined at the sole discretion of the compensation committee of PCS based on MICP EBITDA and the job performance of Mr. Montague. The agreement also provides for participation in employee benefit plans and perquisite programs generally available to our senior executives. In particular, Mr. Montague is entitled to an annual automobile allowance of $13,200, twenty-five (25) days annual paid vacation and business class travel. Mr. Montague is also eligible for a tax “gross up,” to make him whole in the event that an excise tax is due under Section 280G of the Internal Revenue Code in connection with payments contingent on a change in control of PCS.

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Robert J. Binder

Mr. Binder is employed as Vice Chairman and President pursuant to an employment agreement with PCS, dated January 1, 2013. The term of Mr. Binder’s agreement is one year. The agreement provides for an annual base salary of $300,000. Mr. Binder is eligible for an annual cash bonus in an amount to be determined at the sole discretion of the compensation committee of PCS based on EBITDA and the job performance of Mr. Binder. The agreement also provides for participation in employee benefit plans and perquisite programs generally available to our senior executives. In particular, Mr. Binder is entitled to twenty-five (25) days annual paid vacation, business class travel internationally and first class travel to California. Mr. Binder is also eligible for a tax “gross up,” to make him whole in the event that an excise tax is due under Section 280G of the Internal Revenue Code in connection with payments contingent on a change in control of PCS.

Mr. Binder has entered into a new employment agreement effective January 1, 2014, which will terminate December 31, 2016. The agreement provides for a minimum base salary of $500,000, which shall be evaluated for an upward adjustment annually before each compensation determination date, which shall be no later than the first quarter of the applicable fiscal year. Mr. Binder is eligible for an annual cash bonus in an amount to be determined at the sole discretion of the compensation committee of PCS based on MICP EBITDA and the job performance of Mr. Binder. The agreement also provides for participation in employee benefit plans and perquisite programs generally available to our senior executives. In particular, Mr. Binder is entitled to twenty- five (25) days annual paid vacation, business class travel and first class travel to California. Mr. Binder is also eligible for a tax “gross up,” to make him whole in the event that an excise tax is due under Section 280G of the Internal Revenue Code in connection with payments contingent on a change in control of PCS.

Kunal S. Kamlani

Pursuant to an employment agreement with Oceania and PCH dated June 17, 2011, Mr. Kamlani is employed as President and Chief Operating Officer of the above companies and any of their majority owned subsidiaries. The initial term of Mr. Kamlani’s employment expires on December 31, 2014, and the term will automatically renew for an additional year and each anniversary thereafter, unless either party gives written notice of non-renewal within ninety days prior to the expiration of the term (including any renewal thereof). The agreement provides for an annual base salary of $750,000, which shall be reviewed on an annual basis and may be increased, but not decreased, at the discretion of the Board of Directors. Mr. Kamlani is eligible for an annual cash bonus equal to a minimum of $750,000, pro-rated for any fiscal year in which Mr. Kamlani is not employed for the entire year. If Oceania, PCH, and each of their majority owned subsidiaries do not pay any form of cash bonus to their executives or key employees generally, the payment of Mr. Kamlani’s cash bonus may be deferred for up to one calendar year, if such deferral is permitted under applicable law. The employment agreement also provides Mr. Kamlani a time based option to purchase 600,000 shares of Prestige which vest in three cumulative and substantially equal installments on each of the first, second and third anniversaries of his employment, and contemplates future additional grants subject to Board discretion and evaluation of Mr. Kamlani’s performance. Mr. Kamlani is eligible for participation in employee benefit plans and perquisite programs generally available to executives of Oceania. In particular, Mr. Kamlani is entitled to an annual automobile allowance of $13,200 and twenty (20) days annual paid vacation.

Mark Conroy

Effective January 31, 2013, Mr. Conroy stepped down as President of Regent. He previously was employed pursuant to an employment agreement with PCS and Prestige dated February 1, 2011. The agreement provided for a minimum annual base salary of $535,000. Mr. Conroy was eligible for an annual cash bonus, the target of which shall be determined by PCS pursuant to its then applicable management incentive compensation plan, provided that Mr. Conroy’s actual bonus amount will be determined by the board of PCS in its discretion based on performance objectives it establishes with respect to a particular fiscal year. Mr. Conroy was eligible for participation in employee benefit plans and perquisite programs generally available to executives of PCS. In particular, Mr. Conroy was entitled to an annual automobile allowance of $13,200 and six (6) weeks of annual paid vacation.

101

T. Robin Lindsay

Mr. Lindsay is employed as Executive Vice President, Vessel Operations pursuant to an employment agreement with PCS, dated January 1, 2012. The term of Mr. Lindsay’s employment agreement is three years. The agreement provides for a minimum annual base salary of $450,000, which shall be evaluated for an upward adjustment annually before each compensation determination date, which shall be no later than the first quarter of the applicable fiscal year. Mr. Lindsay is eligible for an annual cash bonus in an amount to be determined at the sole discretion of the compensation committee of PCS based on EBITDA and the job performance of Mr. Lindsay. The agreement also provides for participation in employee benefit plans and perquisite programs generally available to our senior executives. In particular, Mr. Lindsay is entitled to an annual automobile allowance of $13,200, twenty-five (25) days annual paid vacation and business class travel. Mr. Lindsay is also eligible for a tax “gross up,” to make him whole in the event that an excise tax is due under Section 280G of the Internal Revenue Code in connection with payments contingent on a change in control of PCS.

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Potential Payments upon Termination of Employment and Change of Control

Pursuant to their employment agreements, each of our named executive officers is eligible to receive certain payments and benefits in connection with termination of employment under various circumstances. The potential benefits payable to our named executive officers in the event of termination of employment under various scenarios are described below.

The following table summarizes the approximate value of the termination payments and benefits that each of our named executive officers would receive if he had terminated employment at the close of business on December 31, 2013. The table does not include certain amounts that the named executive officer would be entitled to receive under certain plans or arrangements that do not discriminate in scope, terms or operation, in favor of our executive officers and that are generally available to all salaried employees.


Name	Voluntary termination or Cause		Death or Disability		Termination Without Cause or for Good Reason		Termination Without Cause or for Good Reason Following a Change in Control		Non-Renewal of an Employment Agreement (2)
Frank J. Del Rio
Severance Payment		—		—		—	$	3,329,600		—
Annual Bonus Award		—		—	$	1,597,200	$	3,194,400		—
Medical Continuation		—		—		—	$	48,436		—
Stock Option Acceleration		—		—		—		—		—
Jason M. Montague
Severance Payment		—		—	$	963,200	$	1,000,000		—
Annual Bonus Award		—		—	$	356,250	$	356,250		—
Medical Continuation		—		—	$	33,560		—		—
Stock Option Acceleration (1)		—		—	$	149,834	$	149,834		—
Robert J. Binder
Severance Payment		—		—	$	600,000	$	1,000,000	$	300,000
Annual Bonus Award		—		—	$	255,000	$	255,000	$	255,000
Medical Continuation		—		—	$	9,824		—	$	9,824
Stock Option Acceleration (1)		—		—	$	18,134	$	18,134		—
Kunal S. Kamlani
Severance Payment		—		—	$	1,650,000	$	1,650,000		—
Annual Bonus Award		—		—	$	750,000	$	750,000		—
Medical Continuation		—		—	$	33,560	$	33,560		—
Stock Option Acceleration (1)		—		—	$	639,332	$	639,332		—
T. Robin Lindsay
Severance Payment		—		—	$	963,200	$	1,000,000		—
Annual Bonus Award		—		—	$	356,250	$	356,250		—
Medical Continuation		—		—	$	33,560		—		—
Stock Option Acceleration (1)		—		—	$	37,478	$	37,478		—

(1)

Under the terms of the Prestige option plan, upon a change in control of the Company, each named executive officer’s outstanding options granted under the plan will generally become fully vested and exercisable. Values shown are for outstanding stock options with a per share exercise price below $16.60, the estimated fair market value of a share of common stock as of December 31, 2013.

(2)	This would have been applicable only for Mr. Binder.

Payments Made Upon Any Termination of Employment. Regardless of the manner in which a named executive officer’s employment terminates, such named executive officer is entitled to receive amounts earned during the term of employment including accrued but unpaid base salary through the date of termination, accrued

103

but unpaid incentive bonus for the year prior to the year of termination (except with respect to terminations for Cause, as defined in each employment agreement), unreimbursed employment-related expenses owed to the named executive officer under our policies and the value of any accrued benefits under any of our employee benefit programs (in accordance with the terms of such programs).

In addition to the accrued obligations, the employment agreements provide for certain additional benefits to be paid in connection with a termination of employment under the circumstances described below, subject to an officer executing a release of claims in favor of the Company:

Frank J. Del Rio

Upon Termination Without Cause or For Good Reason . Mr. Del Rio will be entitled to receive: (i) a pro rata incentive cash bonus for the year of termination and (ii) accelerated vesting of the next tranche of each of the option grants scheduled to vest (if the Board of Directors determines in good faith that the then current progress towards the achievement of performance goals, if applicable, would result in the successful attainment of such goals).

Upon a Sale of the Company . If Mr. Del Rio is terminated without cause (as defined below) during the one hundred eighty (180) day period preceding, or anytime after, or resigns for good cause after, a sale of the Company, he will be entitled to accelerated vesting of his option grants, and two years of each of the following elements of compensation: base salary, incentive bonus, medical benefits, auto allowance, personal tax advice fees, country club dues and fees.

280G Excise Tax Gross Up. Pursuant to his officer employment agreement, in the event that payments to or for the benefit of Mr. Del Rio relating to his termination of employment in connection with a change in control would be subject to an excise tax imposed by Section 4999 of the Internal Revenue Code, the aggregate amount of such payments will be increased so that, after the payment of taxes, he will be in the same position as he would have been had he not been required to pay such excise taxes.

Restrictive Covenants . Pursuant to his officer employment agreement, Mr. Del Rio may not disclose any of our confidential information at any time during or after employment. Additionally, Mr. Del Rio may not compete with our business for a post employment period of one year (two years if the employment terminates as a result of his voluntary termination without good reason) and may not solicit our employees for a post employment period of one year.

For purposes of Mr. Del Rio’s employment agreement:

“Cause” means Mr. Del Rio’s: (i) willful and continued failure to substantially perform his duties under his officer employment agreement after the Board of Directors delivers a written demand for substantial performance and such nonperformance has continued for more than thirty (30) days following such notice; (ii) willful misconduct or gross misconduct that has resulted in material injury to our financial interests or reputation; (iii) violation of our policies and procedures which in the reasonable discretion of the Board of Directors is grounds for termination of employment; (iv) material breach of the restrictive covenants; (v) act or omission which, if convicted by a court of law, would constitute a felony; or involves disloyalty, dishonesty, or insubordination; (vi) act or omission which is an intentional violation of our written policies; (vii) act or omission which results in a breach of any term or condition of the officer employment agreement; or (viii) act or omission which has a material adverse effect on our reputation, business affairs or goodwill. In order for a termination to be for “cause,” such termination must be approved by not less than a majority of the entire membership of the Board of Directors at a meeting of the Board called and held for such purpose.

“Good Reason” means, without Mr. Del Rio’s consent and after receipt from him of written notice stating the good reason event (i) any substantial adverse change in the nature or scope of Mr. Del Rio’s responsibilities, authorities, powers, functions, or duties; (ii) an involuntary reduction in base salary or target incentive

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compensation; (iii) a breach by us of any material obligations under the officer employment agreement; (iv) or the relocation of the primary offices at which he is principally employed or the requirement that Mr. Del Rio be based anywhere other than our current location to more than sixty (60) miles therefrom on an extended basis, except for required business travel to an extent substantially consistent with his current business travel obligations. The Company has a 30 day cure right after receipt of written notice from Mr. Del Rio.

“Sale of the Company” means the consummation of (i) the transfer (in one or a series of related transactions) of all or substantially all of the consolidated assets of Prestige and its subsidiaries, taken as a whole, to a person or a group of persons acting in concert (other than a subsidiary or subsidiaries of Prestige), (ii) the transfer (in one or a series of related transactions) of the outstanding equity securities of Prestige to one person or a group of persons acting in concert, or (iii) the merger or consolidation of Prestige with or into another person, in the case of clauses (ii) and (iii) above, under circumstances in which (x) the holders of a majority of the voting power of the outstanding equity securities of Prestige immediately prior to such transaction (collectively, the “Majority Holder”) own less than a majority in voting power of the outstanding equity securities of Prestige or equity securities of the surviving or resulting person or acquirer, as the case may be, immediately following such transaction and (y) immediately following such transaction, a person (other than the Majority Holder) owns at least a majority in voting power of the outstanding equity securities of Prestige or equity securities of the surviving or resulting person or acquirer, as the case may be. A sale (or multiple related sales) of one or more subsidiaries of Prestige (whether by way of merger, consolidation, reorganization or sale of all or substantially all assets or securities) which constitutes all or substantially all of the consolidated assets of Prestige will be deemed a “Sale of the Company.” For the avoidance of doubt, an underwritten public offering of the securities of Prestige or any of its subsidiaries shall in no event constitute a “Sale of the Company.”

Jason M. Montague and T. Robin Lindsay

Upon Termination due to Death or Disability . The officer will be entitled to receive: (i) a pro rata incentive bonus for the year of termination, payable in a lump sum within thirty days of termination and (ii) accelerated vesting of all option grants.

Upon a Company Non-Renewal of the Employment Term . The officer will be entitled to receive: (i) a pro rata incentive bonus for the year of termination, payable within thirty days of termination, (ii) a severance payment payable in a lump sum within thirty days of termination equal to six months of the officer’s base salary and (iii) all insurance benefits and automobile allowances for a post termination period of one year.

Upon Termination due to a Change in Control . If, within ninety (90) days prior to, or within twelve (12) months after the occurrence of an event constituting a change in control, the officer’s employment is terminated without “cause,” for “good reason” (each as defined below) or due to non-renewal of the employment term, the officer shall receive, in a lump sum, within ten (10) days after the separation from service (i) $1,000,000 and (ii) a pro rata incentive bonus for the year of termination.

280G Excise Tax Gross Up . Pursuant to the officer employment agreements, in the event that payments to or for the benefit of the officer relating to his termination of employment in connection with a change in control would be subject to an excise tax imposed by Section 4999 of the Internal Revenue Code, the aggregate amount of such payments will be increased so that, after the payment of taxes, the officer will be in the same position as he would have been had he not been required to pay such excise taxes.

Restrictive Covenants . Pursuant to the officer employment agreements, the officer may not disclose any of our confidential information at any time during or after employment. Additionally, the officer may not compete with our business for a post-employment period of one year and may not solicit our employees or customers for a post-employment period of one year.

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For purposes of Mr. Montague’s and Mr. Lindsay’s employment agreements:

“Cause” means the officer’s: (i) willful and continued failure to perform his duties under his officer employment agreement after the Board of Directors delivers a written demand for substantial performance and such nonperformance has continued for more than thirty (30) days following such notice; (ii) willful misconduct or gross misconduct that has resulted in material injury to our financial interests or reputation; (iii) violation of our policies and procedures which in the reasonable discretion of the Board of Directors is grounds for termination of employment; (iv) material breach of the restrictive covenants; (v) act or omission which, if convicted by a court of law, would constitute a felony; or involves disloyalty, dishonesty, or insubordination; (vi) act or omission which is an intentional violation of our written policies; (vii) act or omission which results in a breach of any term or condition of the officer employment agreement; or (viii) act or omission which has a material adverse effect on our reputation, business affairs or goodwill.

“Good Reason” means, without the officer’s consent and after receipt from the officer of written notice stating the good reason event (i) any substantial adverse change in the nature or scope of the officer’s responsibilities, authorities, powers, functions, or duties; (ii) an involuntary reduction in base salary or target incentive compensation; (iii) a breach by us of any material obligations under the officer employment agreement; or (iv) the relocation of the primary offices at which the officer is principally employed or the requirement that the officer be based anywhere other than our current location to more than sixty (60) miles therefrom on an extended basis, except for required business travel to an extent substantially consistent with the officer’s current business travel obligations. The Company has a 30 day cure right after receipt of written notice from the officer.

“Change in Control” means the acquisition by any individual, entity, or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) other than PCS, or any of its subsidiaries, or affiliated companies, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of fifty-one percent (51%) or more of the common voting stock of the then outstanding voting securities of PCS, entitled to vote generally in the election of directors.

Robert J. Binder

Upon a Company Non-Renewal of the Employment Term . The officer will be entitled to receive: (i) a pro rata incentive bonus for the year of termination, payable within thirty days of termination, (ii) a severance payment payable in a lump sum within thirty days of termination equal to one year of the officer’s base salary and (iii) all insurance benefits and automobile allowances for a post termination period of one year.

Upon Termination Without Cause or For Good Reason . The officer will be entitled to: (i) a pro rata incentive bonus for the year of termination, payable in a lump sum within thirty days of termination, (ii) accelerated vesting of all option grants, (iii) a severance payment payable in a lump sum within thirty days of termination equal to two years of the officer’s base salary and (iv) all insurance benefits and automobile allowances for a post termination period of one year.

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would be subject to an excise tax imposed by Section 4999 of the Internal Revenue Code, the aggregate amount of such payments will be increased so that, after the payment of taxes, the officer will be in the same position as he would have been had he not been required to pay such excise taxes.

For purposes of Mr. Binder’s employment agreement:

Kunal S. Kamlani

Upon Termination due to Death or Disability. Mr. Kamlani will be entitled to receive a pro rata incentive bonus for the year of termination, payable at the time incentive bonuses are paid to other employees.

Upon Termination Without Cause, For Good Reason or Upon a Company Non-Renewal of the Employment Term . Mr. Kamlani will be entitled to receive: (i) a pro rata incentive bonus for the year of termination, payable at the time incentive bonuses are paid to other employees, (ii) accelerated vesting of all option grants, (iii) a severance payment equal to one year of his base salary plus $750,000, payable in substantially equal installments over six months, and (iv) all COBRA premium insurance charges for a period of one year post termination.

Upon a Change in Control . Mr. Kamlani will be entitled to accelerated vesting of his option grants.

Restrictive Covenants . Pursuant to his officer employment agreement, Mr. Kamlani may not disclose any of our confidential information at any time during or after employment. Additionally, Mr. Kamlani may not compete with our business or solicit our employees or customers for a period of one year post employment.

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For purposes of Mr. Kamlani’s employment agreement:

“Cause” means Mr. Kamlani (i) is convicted of, or pleads guilty or no contest to, a felony; (ii) has engaged in fraud, or other acts of willful misconduct or dishonesty in the course of his duties; (iii) willfully fails to perform or uphold his duties under the officer employment agreement or willfully fails to comply with reasonable Board of Directors directives, and such failure is not cured within ten (10) days of Mr. Kamlani’s receipt of written notice of such failure; or (iv) materially breaches his restrictive covenant obligations under his officer employment agreement or any material breach of any other employment related contract which is not cured within ten (10) days following Mr. Kamlani’s receipt of written notice of such material breach.

“Good Reason” (constructive termination) means Mr. Kamlani’s resignation after the occurrence of any of the following conditions: (i) any diminution in base salary or minimum bonus amount; (ii) a diminution in his authority, duties, or responsibilities as measured in the aggregate; (iii) a change in the geographic location of his principal place of employment from the greater Miami, Florida area; or (iv) our material breach of Mr. Kamlani’s employment agreement. Mr. Kamlani must provide written notice of the condition claimed to constitute grounds for good reason within sixty (60) days of the initial existence of such condition and the Company has a thirty (30) day cure right after receiving such written notice. Additionally, the termination of his employment must occur within one hundred and twenty (120) days following the initial existence of the condition claimed to constitute grounds for good reason.

Mark S. Conroy

Pursuant to his Separation Agreement and Independent Contractor Agreement, Mr. Conroy was paid one year salary and COBRA benefits totaling $582,530 in February 2013. He also was paid $39,558 of pro-rata 2013 MICP from January 1 through January 30, 2013. In return for severance pay and benefits, Mr. Conroy has released the Company from any and all claims. As part of his consultant agreement, Mr. Conroy will receive total cash payments of $614,838, payable through January 2015, and was granted 100,000 Prestige options at a grant price of $8.85. The consultant agreement is for a term of twenty-four months.

Equity Incentive Plan Awards

2008 Stock Option Plan

Under the terms of the Prestige option plan, if there is a Sale of the Company, each named executive officer’s outstanding options granted under the plan will generally become fully vested and exercisable, unless the Compensation Committee provides for the substitution, assumption, exchange or other continuation or settlement of such options. The Compensation Committee however has authority to accelerate vesting in such circumstances as it may deem appropriate.

“Sale of the Company” is defined as the consummation of (i) the transfer (in one or a series of related transactions) of all or substantially all of the consolidated assets of Prestige and its subsidiaries, taken as a whole, to a person or a group of persons acting in concert (other than a subsidiary or subsidiaries of Prestige), (ii) the transfer (in one or a series of related transactions) of the outstanding equity securities (including (A) any equity securities issued to Apollo upon exercise of the Apollo stock options and (B) any equity securities issued to the Non-Apollo Holders upon exercise of the Non-Apollo Holder stock options) to one person or a group of persons acting in concert, or (iii) the merger or consolidation of Prestige with or into another person, in the case of clauses (ii) and (iii) above, under circumstances in which (x) the holders of a majority of the voting power of the outstanding equity securities of Prestige immediately prior to such transaction (collectively, the “Majority Holder”) own less than a majority in voting power of the outstanding equity securities of Prestige or equity securities of the surviving or resulting person or acquirer, as the case may be, immediately following such transaction and (y) immediately following such transaction, a person (other than the Majority Holder) owns at least a majority in voting power of the outstanding equity securities of Prestige or equity securities of the surviving or resulting person or acquirer, as the case may be. A sale (or multiple related sales) of one or more

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subsidiaries of Prestige (whether by way of merger, consolidation, reorganization or sale of all or substantially all assets or securities) which constitutes all or substantially all of the consolidated assets of Prestige will be deemed a “Sale of the Company.” For the avoidance of doubt, an underwritten public offering of the securities of Prestige or any of its subsidiaries shall in no event constitute a “Sale of the Company.”

Subject to any accelerated vesting that may apply in the circumstances in connection with certain terminations of employment, as detailed above, unvested options are generally forfeited and immediately terminate upon a termination of employment.

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Director Compensation

The following table sets forth information for compensation earned in fiscal year 2013 by our non-executive directors:


Name	Fees Earned or Paid in Cash ($)		Stock Awards ($)		Option Awards ($) (1)		Non-Equity Incentive Plan compensation ($)		Change in Pension Value and Deferred Compensation Earnings		All Other Compensations ($) (4)		Total ($)
Adam M. Aron (2)		100,000		—		—		—		—		—		100,000
Kevin E. Crowe (3)		—		—		—		—		—		—		—
Russell W. Galbut (3)		—		—		7,653		—		—		—		7,653
Daniel M. Holtz (2)(3)		50,000		—		—		—		—		—		50,000
Steve Martinez (2)		—		—		—		—		—		—		—
Eric L. Press		—		—		—		—		—		—		—

(1)

In the case of Mr. Galbut, this represents the aggregate grant date fair value for options granted to him in 2013, computed in accordance with FASB ASC Topic 718, disregarding any estimates of forfeitures related to service-based vesting conditions. The other non-executive directors did not receive an option grant in 2013.

(2)	Each of the above directors is a member of the Compensation Committee.

(3)	Each of the above directors is a member of the Audit Committee.

(4)	All non-executive directors are encouraged to take one cruise each year for product familiarization. The aggregate value of other compensation made available to non-executive directors, including discounts on company cruises, is less than $10,000 per person.

The outstanding stock options held by our directors on December 31, 2013 are set forth below:


Name	No. of Securities Underlying Unexercised Options (#) Exercisable		No. of Securities Underlying Unexercised Options (#) Unexercisable
Adam M. Aron		98,388		—
Kevin E. Crowe (1)		15,000		—
Russell W. Galbut		33,000		—
Daniel M. Holtz		15,000		—
Steve Martinez (1)		15,000		—
Eric L. Press (1)		15,000		—

(1)

In the case of Messrs. Crowe, Press and Martinez, stock options are not held by the director individually, but held by Apollo in recognition of the directors’ service on our Board. Although each of Messrs. Crowe, Press, and Martinez may be deemed a beneficial owner of our equity interests beneficially owned by Apollo through Prestige due to his status as an investment professional with Apollo or a partner or senior partner of Apollo, each such person disclaims beneficial ownership of any such shares.

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PRINCIPAL SHAREHOLDERS

The following table sets forth information regarding the beneficial ownership of our common stock by:

•

each person known by us to beneficially own more than 5% of our outstanding common stock;

•

each of our named executive officers;

•

each of our directors; and

•

all directors and named executive officers as a group.

The percentage of common stock beneficially owned immediately prior to the completion of this offering is based on shares of common stock issued and outstanding as of the date of this prospectus, but without giving effect to the exercise of stock options to acquire shares of common stock in connection with this offering. The percentage of common stock beneficially owned after this offering is based on the shares of common stock that will be issued and outstanding upon the completion of this offering (including the shares of common stock issued upon the exercise of stock options in connection with this offering). In addition, common stock issuable pursuant to stock options are deemed outstanding for computing the percentage of the person holding such options, but are not outstanding for computing the percentage of any other person. All shares of common stock listed in the table below are entitled to one vote per share, unless otherwise indicated in the notes thereto. Unless otherwise indicated, the address of each person named in the table below is c/o Prestige Cruises International, Inc., 8300 NW 33 ^rd Street, Suite 100, Miami, Florida 33122.


Name of Beneficial Owner:	Prior to this Offering					After Giving Effect to this Offering
Name of Beneficial Owner:	Shares Beneficially Owned		Percentage of Shares Beneficially Owned			Percent of Shares Beneficially Owned Assuming no Exercise of the Option to Purchase Additional Shares	Percent of Shares Beneficially Owned Assuming Full Exercise of the Option to Purchase Additional Shares
Apollo Management Holdings, L.P. (1)		43,797,618		78.3	%
Kevin E. Crowe (1)(2)		—		*
Eric L. Press (1)(2)		—		*
Steve Martinez (1)(2)		—		*
Adam Aron (1)(3)		98,388		*
Frank J. Del Rio (4)		2,628,630		4.7	%
Russell W. Galbut (5)		1,727,217		3.1	%
Daniel M. Holtz (6)		433,382		*
Kunal S. Kamlani (7)		433,334		*
Jason M. Montague (8)		179,509		*
Robert J. Binder (9)		221,389		*
T. Robin Lindsay (10)		231,155		*
All Administrators and Named Executive Officers as a group (11 persons)		5,953,004		10.6	%

*	Represents beneficial ownership of less than one percent of our outstanding common stock.

(1)

Represents (i) ownership of capital stock of PCI by AAA Guarantor—Co-Invest VI, L.P. (“AAA Co-Invest VI”), AIF VI Euro Holdings, L.P. (“AIF VI Euro Holdings”), AAA Guarantor—Co-Invest VII, L.P. (“AAA Co-Invest VII”) and AIF VII Euro Holdings, L.P. (“AIF VI Euro Holdings,” and together with AAA Co-Invest VI, AIF VI Euro Holdings and AAA Co-Invest VII, the “Apollo Funds”), and (ii) options to purchase shares of common stock of PCI held by PCI Investco I, Inc., PCI Investco II, Inc., PCI Investco III, Inc., and PCI Investco IV, Inc. (collectively, the “PCI Investco Entities”). The Apollo Funds are affiliates of Apollo and are each managed by affiliates of Apollo Management Holdings, L.P. The general partner of Apollo Management Holdings, L.P. is Apollo Management Holdings GP, LLC. The sole member and manager of

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Apollo Management Holdings GP, LLC is an affiliate of Apollo. The PCI Investco Entities are affiliates of the Apollo Funds and of Apollo. The number of shares reported as beneficially owned by Apollo Management Holdings, L.P. in the above table includes options to purchase 45,000 shares of common stock of PCI issued to certain affiliates of Apollo Management Holdings, L.P. under the Prestige option plan in connection with board services provided to PCI or its subsidiaries by such affiliates which have vested. The address of each of AAA Co-Invest VI and AAA Co-Invest VII is Trafalgar Court, Les Banques, GY1 3QL, St. Peter Port, Guernsey, Channel Islands. The address of each of AIF VI Euro Holdings and AIF VII Euro Holdings is c/o Walkers Corporate Services Limited, P.O. Box 908-GT, Walker House, 87 Mary Street, George Town, Grand Cayman, KY1-9005. The address of the PCI Investco Entities is c/o Arias, Fabrega & Fabrega, P.H. Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama. The address of each of Apollo Management Holdings, L.P. and Apollo Management Holdings GP, LLC is c/o Apollo Management, L.P., 9 West 57th Street, 43rd Floor, New York, New York.

(2)

Although each of Messrs. Crowe, Press, and Martinez may be deemed a beneficial owner of shares of common stock of PCI beneficially owned by Apollo due to his status as an investment professional with Apollo or a partner or senior partner of Apollo, each such person disclaims beneficial ownership of any such shares. The address of Messrs. Crowe, Press, and Martinez is c/o Apollo Management, L.P., 9 West 57 ^th Street, New York, New York 10019.

(3)

Although Mr. Aron may be deemed a beneficial owner of shares of common stock of PCI beneficially owned by Apollo due to his status as a consultant of Apollo, he disclaims beneficial ownership of any such shares. The address of Mr. Aron is c/o Apollo Management, L.P., 9 West 57 ^th Street, New York, New York 10019. Includes options to purchase 15,000 shares of common stock of PCI issued to Mr. Aron under the Prestige option plan in connection with his service on the boards of directors of PCI and options to purchase 83,388 shares of common stock of PCI issued to World Leisure Partners, Inc., a corporation owned and controlled by Mr. Aron, under the Prestige option plan, all of which have vested.

(4)	Includes options to purchase 1,216,216 shares of common stock of PCI issued to Mr. Del Rio under the Prestige option plan, which have vested.

(5)	Includes options to purchase 33,000 shares of common stock of PCI issued to Mr. Galbut under the Prestige option plan in connection with his service on the boards of directors of PCI, which have vested.

(6)	Includes options to purchase 15,000 shares of common stock of PCI issued to Mr. Holtz under the Prestige option plan in connection with his service on the boards of directors of PCI, which have vested.

(7)	Includes options to purchase 433,334 shares of common stock of PCI issued to Mr. Kamlani under the Prestige option plan, which have vested. Does not include options to purchase 266,666 shares of common stock of PCI issued to Mr. Kamlani under the Prestige option plan, which have not vested.

(8)	Includes options to purchase 173,333 shares of common stock of PCI issued to Mr. Montague under the Prestige option plan, which have vested. Does not include options to purchase 56,667 shares of common stock of PCI issued to Mr. Montague under the Prestige option plan, which have not vested.

(9)	Includes options to purchase 188,333 shares of common stock of PCI issued to Mr. Binder under the Prestige option plan, which have vested. Does not include options to purchase 6,667 shares of common stock of PCI issued to Mr. Binder under the Prestige option plan, which have not vested.

(10)	Includes options to purchase 194,917 shares of common stock of PCI issued to Mr. Lindsay under the Prestige option plan, which have vested. Does not include options to purchase 15,083 shares of common stock of PCI issued to Mr. Lindsay under the Prestige option plan, which have not vested.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Stockholders’ Agreement

On May 18, 2009, we amended and restated our stockholders’ agreement (the “PCI Stockholders’ Agreement”) by and among us, PCI Investco I, Inc., PCI Investco II, Inc., PCI Investco III, Inc., PCI Investco IV, Inc., AIF VI Euro Holdings, L.P., AAA Guarantor—Co-Invest VI, L.P., AIF VII Euro Holdings, L.P., AAA Guarantor—Co-Investor VII, L.P. and our other shareholders from time to time party thereto. The PCI Stockholders’ Agreement governs certain aspects of the relationship between us and our security holders. The PCI Stockholders’ Agreement, among other things, provides for the following:

•

restricts the ability of certain security holders of Prestige to transfer, assign, sell, gift, pledge, hypothecate or encumber, or otherwise dispose of, Prestige’s common stock or of all or part of the voting power associated with the common stock without prior consent of our Board of Directors; and

•

permits those holders of Prestige’s common stock to include their shares in a registration statement filed by Prestige with respect to any offering of common stock by Prestige.

In addition, we have granted Apollo demand registration rights under the PCI Stockholders’ Agreement. These and the registration rights of our security holders pursuant to the PCI Stockholders’ Agreement are subject to customary cutback provisions, including the requirement that all holders of our common stock will be subject to customary lock-up provisions in connection with their participation in any registered offering.

The PCI Stockholders’ Agreement terminates with respect to all rights or obligations related to Prestige’s common stock upon the earliest to occur of (i) Prestige’s dissolution, (ii) an underwritten public offering of Prestige’s equity securities pursuant to which the aggregate offering price of the equity securities sold in such offering is at least $75 million in gross proceeds (provided, however, that the provision relating to registration rights do not terminate upon the consummation of such an offering), (iii) the transfer of all or substantially all of Prestige’s assets to a person or group other than a subsidiary of Prestige, (iv) the transfer to a person or group of the outstanding equity securities of Prestige, or (v) the merger or consolidation of Prestige with or into another entity; provided that, in the case of clauses (iv) and (v), the holders of a majority of the voting power of Prestige’s outstanding equity securities immediately prior to such transaction own less than a majority in voting power of Prestige’s outstanding equity securities immediately following such transaction, and immediately following such transaction, another person owns at least a majority in voting power of Prestige’s outstanding equity securities. At the time of the consummation of this offering, most provisions in the PCI Stockholders’ Agreement will terminate, other than those relating to the registration rights described above.

Apollo Agreements

Oceania Cruises, Inc. entered into a management agreement with Apollo on April 27, 2007, pursuant to which Apollo provides them with management services. Pursuant to such agreement, Apollo receives an annual management fee equal to either (i) $775,000, for so long as Adam M. Aron serves as a member of our Board or (ii) $875,000, in the event that Mr. Aron ceases to serve as a member of our Board and World Leisure Partners, Inc. no longer receives a $100,000 annual fee as payment for such service. Such fee shall be payable in four equal installments to Apollo. Oceania shall also pay Apollo a fee equal to 1.5% of the total amount of capital contributed from time to time to Oceania or its subsidiaries by Apollo or its affiliates. The management agreement will terminate on April 27, 2017, unless earlier terminated by Apollo or a Change of Control or Qualified IPO (each, as defined in the management agreement) occurs. In the event of a Change of Control or a Qualified IPO by Oceania or its subsidiaries, Oceania shall pay to Apollo a lump sum cash payment equal to the then present value of all then current and future annual fees (based on the annual fee then in effect) assuming the agreement ends on April 27, 2017, unless Apollo beneficially owns less than 20% of Oceania, in which case, no such fee is due. We and Apollo intend to amend the management agreement prior to the consummation of this offering to provide that this offering will constitute a Qualified IPO.

Upon consummation of this offering, Apollo intends to terminate the management agreement, and will receive approximately $ for reimbursement of expenses. Apollo intends not to receive a transaction fee in connection with this offering.

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The terms and fees payable to Apollo under the management agreement were determined through arm’s-length negotiations between us and Apollo, and reflect the understanding of Apollo and us of the fair value for such services, based in part on market conditions and what similarly situated companies have paid for similar services. The management agreement contains customary indemnification provisions in favor of Apollo, as well as expense reimbursement provisions with respect to expenses incurred by Apollo in connection with its performance of services thereunder, which will survive termination of the agreement.

Related Party Debt

From 2008 to 2010, we issued an aggregate principal amount of $662.5 million in promissory notes to Apollo and an aggregate principal amount of $32.7 million in promissory notes to certain other shareholders. A portion of the promissory notes, with an aggregate principal amount of $507.8 million, bear interest at a rate of 5% per annum, cumulative, compounding semi-annually (the “5% Notes”). The remaining promissory notes, with an aggregate principal amount of $187.4 million, are non-interest bearing and were only issued to Apollo (the “Non-Interest Bearing Notes”). The promissory notes mature at the earlier of a qualified public offering (as defined in the notes), the sale of Prestige, or on the tenth anniversary of the issue date of the promissory notes.

In conjunction with the issuances of the 5% Notes, we also issued a total of 24.3 million warrants to Apollo and 3.4 million warrants to certain other shareholders to purchase common stock bearing a 5% payment-in-kind dividend rate per annum, with dividends being cumulative, compounding semi-annually and payable in additional warrants. In conjunction with the issuance of the Non-Interest Bearing Notes to Apollo, we issued 4.7 million non-dividend paying warrants to Apollo. The warrants issued in 2008 have an exercise price of $40.02355 and the warrants issued in 2009 and 2010 have an exercise price of $9.25. All such warrants are immediately exercisable and expire at the earlier of a qualified public offering (as defined in the applicable warrant agreement), the sale of Prestige or on the tenth anniversary of the effective date of the warrant agreement. See “Description of Certain Indebtedness—Related Party Debt.”

Related Party Transaction Policy and Procedure

Our management is responsible for the review and approval of all related party transactions. We believe management’s review is fair, in line with industry standards and on similar terms as could have been obtained from an unaffiliated third party. While we do not currently have a written policy for review and approval of related party transactions, we will have such a policy prior to the consummation of this offering.

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DESCRIPTION OF CERTAIN INDEBTEDNESS

We summarize below the principal terms of the agreements that govern our New Build Financings, Secured Credit Facilities and Regent’s Senior Secured Notes. Our “Secured Credit Facilities” consist of the Oceania Credit Facility and the Regent Credit Facility. Because this is only a summary, it does not contain all the information that may be important to you. For a complete description of the matters set forth in this “Description of Certain Indebtedness,” you should refer to the agreements governing our outstanding indebtedness, which are included as exhibits to the registration statement of which this prospectus forms a part. The agreements contain covenants that, among other things, require us to maintain a minimum level of liquidity, maintain certain other ratios and restrict our ability to pay dividends. We were in compliance with these financial covenants as of December 31, 2013. Our ships are pledged as collateral for our debt.

We have incurred substantial indebtedness, mainly related to the acquisition of our ships, and are highly leveraged with a high level of floating rate debt. As of December 31, 2013 our shareholders’ equity was $36.6 million and as of December 31, 2012 our shareholders’ deficit was $13.3 million.

Third Party Debt


	December 31,
(in thousands)	2013		2012
Oceania Term Loan, First Lien, due 2015 (1)		—		231,688
Oceania Term Loan, Second Lien, due 2014 (1)		—		4,843
Oceania Term Loan, Second Lien, due 2015 (1)		—		70,157
Oceania Term Loan, First Lien, due through 2020		299,250		—
Oceania Marina Newbuild Debt, due through 2023		424,123		446,445
Oceania Riviera Newbuild Debt, due through 2024		471,611		471,611
Regent Term Loan, First Lien, due through 2018		296,250		296,250
Regent Senior Secured Notes, due 2019		225,000		225,000

Total third party debt	$	1,716,234	$	1,745,994

(1)

The Oceania First Lien Term Loan and Oceania Second Lien Term Loan were repaid in full with the proceeds of the Oceania Credit Facility on July 2, 2013. As of December 31, 2013, $299.3 million was outstanding under the Oceania Term Loan (as defined below) and $75.0 million in available borrowings under the Oceania Revolving Credit Facility (as defined below).

Interest expense on third-party debt, including interest rate swaps, was $70.4 million (net of capitalized interest of $0.7 million) and $65.9 million (net of capitalized interest of $1.2 million) for the years ended December 31, 2013 and 2012, respectively.

Oceania Credit Facility

On April 27, 2007, our wholly owned subsidiaries Insignia Vessel Acquisition, LLC, Regatta Acquisition, LLC and Nautica Acquisition, LLC (collectively, the “Oceania Borrowers”) and Oceania, as guarantor, entered into a $75.0 million second lien credit agreement (as subsequently amended, the “Oceania Second Lien Term Loan”). As of December 31, 2012, we had $75.0 million outstanding under the Oceania Second Lien Term Loan.

Also on April 27, 2007, the Oceania Borrowers entered into a $340.0 million first lien credit agreement consisting of a $300.0 million term loan (as subsequently amended, the “Oceania First Lien Term Loan”) and a

$40.0 million revolving credit facility (as subsequently amended to $35.0 million, the “Oceania Revolving Credit Facility”). As of December 31, 2012, we had $231.7 million outstanding under the Oceania First Lien Term Loan and $35.0 million in available borrowings under the Oceania Revolving Credit Facility.

On July 2, 2013, Oceania and OCI Finance Corp., as borrowers, entered into a $375.0 million credit agreement (the “Oceania Credit Facility”). The Oceania Credit Facility consists of a $300.0 million term loan

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(the “Oceania Term Loan”), which matures on July 2, 2020, and a $75.0 million revolving credit facility (the “Oceania Revolving Credit Facility”) which matures July 2, 2018 and replaces the previous Oceania Revolving Credit Facility. Proceeds from the Oceania Credit Facility were used to repay in full the Oceania First Lien Term Loan and Oceania Second Lien Term Loan.

Borrowings under the Oceania Credit Facility bear interest at a rate of LIBOR with a floor of 1.0% plus a margin of 5.75%, and include an original issue discount of 1.0%. In addition, Oceania is required to pay a quarterly commitment fee for any unused and uncancelled commitments under the Oceania Revolving Credit Facility at an annual rate of up to 0.5%. The Oceania Term Loan requires quarterly payments of principal equal to 0.25% of the original principal amount of the term loan, beginning in December 2013, with the remaining unpaid amount due and payable at maturity. Borrowings under the Oceania Credit Facility are pre-payable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months of the closing date. As of December 31, 2013, we had $299.3 million outstanding under the Oceania Term Loan and $75.0 million in available borrowings under the Oceania Revolving Credit Facility.

Our obligations under the Oceania Credit Facility are guaranteed by Oceania and secured by a first priority security interest in the assets of Oceania, OCI Finance Corp. and the Oceania Borrowers, with certain exceptions. The Oceania Credit Facility contains financial covenants including requirements to maintain a maximum loan-to value ratio, a minimum interest coverage ratio (applicable only to Oceania’s Revolving Credit Facility, if drawn) and restrictions on our and our subsidiaries’ ability to, among other things, incur additional indebtedness, incur liens on assets, make certain investments, pay dividends or make distributions, enter into certain transactions with affiliates and merge, consolidate or sell certain key assets. As of December 31, 2013, we are in compliance with all financial covenants.

Oceania Newbuild Financings

Riviera Newbuild Debt

On July 18, 2008, Riviera New Build LLC, a wholly owned subsidiary of Oceania, entered into a loan facility providing for borrowings to finance the Riviera vessel delivery (the “ Riviera Loan”). Riviera New Build LLC’s obligations under the Riviera Loan are guaranteed by Oceania and PCH. The Riviera Loan is also 95% guaranteed to the lenders by Servizi Assicurativi del Commercio Estero (“SACE”), the official export credit agency of Italy. On April 27, 2012, Oceania took delivery of Riviera and concurrently borrowed $539.0 million on the loan facility. The Riviera Loan matures on April 27, 2024, on the twelfth anniversary of the delivery date of the vessel. The proceeds of the Riviera Loan were used to finance 80% of the construction contract for the Riviera , the settlement of related euro foreign currency hedges and the balance of the export credit agency fee. Oceania is required to make 24 semi-annual principal payments on the loan commencing six months after the draw-down date of April 27, 2012.

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Borrowings under the Riviera Loan are pre-payable in whole or in part without penalty. The interest rate for borrowings under the Riviera Loan is based on six-month LIBOR plus a margin of 0.55%. However, if a market disruption event (as defined by the lender) occurs, the floating interest rate can be amended to include an adjusted spread. As of December 31, 2013, the all-in interest rate, which did not include an adjusted spread, was 0.91%. The outstanding balance under the Riviera Loan as of December 31, 2013 was $471.6 million. Additionally, PCI issued a $15.0 million letter of credit in 2012 for the benefit of the lenders under the Riviera Loan, which automatically renews each year. Pursuant to the terms of the loan agreement, we anticipate this letter of credit will be released during 2014.

Marina Newbuild Debt

On July 18, 2008, Marina New Build LLC, a wholly owned subsidiary of Oceania, entered into a loan facility providing for borrowings to finance the Marina vessel delivery (the “ Marina Loan”). Marina New Build LLC’s obligations under the Marina Loan are guaranteed by Oceania and PCH. The Marina Loan is also 95% guaranteed to the lenders by SACE. On January 19, 2011, Oceania took delivery of Marina and concurrently borrowed $535.7 million on the loan facility. The Marina Loan matures on January 19, 2023, on the twelfth anniversary of the delivery date of the vessel. Similar to the Riviera Loan, the proceeds of the Marina Loan were used to finance 80% of the construction contract for the Marina , the settlement of related euro foreign currency hedges and the balance of the export credit agency fee. Oceania is required to make 24 semi-annual principal payments on the loan commencing six months subsequent to the draw-down date of January 19, 2011.

Borrowings under the Marina Loan are pre-payable in whole or in part without penalty. The interest rate for borrowings under the Marina Loan is based on six-month LIBOR plus a margin of 0.55%. However, if a market disruption event (as defined by the lender) occurs, the floating interest rate can be amended to include an adjusted spread. As of December 31, 2013, the all-in interest rate, including an adjusted spread, was 1.10%. The outstanding balance under the Marina Loan as of December 31, 2013 was $424.1 million. Additionally, PCI issued a $15.0 million letter of credit in 2011 for the benefit of the lenders under the Marina Loan, which automatically renews each year. Pursuant to the terms of the loan agreement, we anticipate this letter of credit will be released during 2014.

During October 2013 the lenders notified Oceania that the market disruption event no longer existed and the adjusted spread would no longer be required effective at the next scheduled interest rate reset on each vessel.

Oceania Newbuild Debt Covenants

The Oceania newbuild loan facilities, as amended, contain financial covenants, including requirements for OCI to maintain a minimum liquidity balance, and for PCH to maintain a maximum total debt to EBITDA ratio, a minimum EBITDA to debt service ratio and a maximum total debt to total adjusted equity ratio as of the last day of the calendar year. EBITDA, as defined in the Oceania newbuild loan agreements, includes certain adjustments for purposes of calculating this ratio. PCH is a guarantor of these newbuild loan facilities. As of December 31, 2013, we are in compliance with all newbuild loan financial covenants.

Regent Credit Facility

In August 2012, Regent entered into a $340.0 million credit agreement, consisting of a $300.0 million term loan maturing in December 2018 (the “Regent Term Loan”) and a $40.0 million revolving credit facility maturing August 2017 (the “Regent Revolving Credit Facility” and, together with the Regent Term Loan, the “Regent Credit Facility”). Regent used the proceeds from the borrowings under the Regent Credit Facility to repay the outstanding balances of a previously existing credit facility and for general corporate purposes. Borrowings under the Regent Term Loan and Regent Revolving Credit Facility bear interest at LIBOR, with a floor of 1.25%, and an applicable margin of either 4.75% or 5.0% based on a leverage ratio (as defined in the credit agreement). The Regent Term Loan requires quarterly payments of principal equal to $0.75 million, beginning in December 2012, with the remaining unpaid amount due and payable at maturity. Borrowings under

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the Regent Credit Facility are prepayable in whole or in part at any time without premium or penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months of the closing date. In addition, we are required to pay a quarterly commitment fee for any unused and uncancelled commitments under the Regent Revolving Credit Facility at an annual rate of up to 0.5%.

On February 1, 2013, Regent amended the Regent Credit Facility to re-price the applicable margin on the outstanding balance of the Regent Term Loan. Interest on borrowings under the Regent Term Loan are calculated based upon LIBOR, with a floor of 1.25%, plus a margin of 3.50%. As of December 31, 2013, we had $296.3 million outstanding under the Regent Term Loan and $40.0 million in available borrowings under the Regent Revolving Credit Facility.

On February 7, 2014, Regent amended its existing $340.0 million Regent Credit Facility. In conjunction with this amendment, $50.3 million of the Regent Term Loan was prepaid such that the outstanding balance on the Regent Term Loan under the Regent Credit Facility of $296.3 million was reduced to $246.0 million. The interest rate margin on the amended Regent Term Loan is 2.75% compared to 3.50% on the previously existing term loan and the LIBOR floor was reduced from 1.25% to 1.00%. The amended Regent Term Loan requires quarterly payments of principal equal to $0.6 million beginning March 2014, with the remaining unpaid amount due and payable at maturity. Borrowings under the amended Regent Term Loan are pre-payable in whole or in part at any time with out penalty, but are subject to a prepayment premium in the event of a refinancing of the Regent Term Loan with in twelve months of the amendment date. There was no change to the terms of the $40.0 million Regent Revolving Credit Facility, the financial covenants or the maturity date of the Regent Credit Facility.

Regent’s obligations under the Regent Credit Facility are guaranteed by certain of its affiliates, including its parent companies Classic Cruises, LLC and Classic Cruises II, LLC, as well as certain of its subsidiaries. Regent’s obligations under the Regent Credit Facility are secured by a first priority security interest in the assets of Regent and the guarantors, with certain exceptions. The Regent Credit Facility contains financial covenants including requirements to maintain a maximum loan-to value ratio, a minimum interest coverage ratio (applicable only to Regent’s Revolving Credit Facility, if drawn) and restrictions on our and our subsidiaries’ ability to, among other things, incur additional indebtedness, incur liens on assets, make certain investments, pay dividends or make distributions, enter into certain transactions with affiliates and merge, consolidate or sell certain key assets. As of December 31, 2013, we are in compliance with all financial covenants.

Regent Senior Secured Notes

In May 2011, Regent issued $225.0 million in aggregate principal amount of 9.125% Second-Priority Senior Secured Notes through a private placement with registration rights (the “Senior Secured Notes”). The Senior Secured Notes are due on May 15, 2019, with interest payments due semi-annually, and are guaranteed by Regent’s material subsidiaries existing at the time of the notes issuance. The Senior Secured Notes are secured by, among other things, second-priority mortgage liens on Regent’s three passenger cruises ships and a second-priority security interest in all earnings, proceeds of insurance and certain other interests related to those ships, subject to certain exceptions and permitted liens. The liens securing the Senior Secured Notes and the related guarantees are second in priority to the liens on the collateral securing the Regent Credit Facility. Regent used the proceeds from the Senior Secured Notes to pay down previously existing indebtedness. Regent had $225.0 million in aggregate principal amount of the Senior Secured Notes outstanding at December 31, 2013.

Covenants under the Senior Secured Notes include, but are not limited to, limitations on Regent’s ability to incur indebtedness and issue disqualified stock and preferred stock, make restricted payments, pay dividends, enter into transactions with affiliates, sell certain assets, create or incur certain liens, and consolidate, merge, sell, transfer or otherwise dispose of all, or substantially all, of its assets. Regent may redeem the Senior Secured Notes, in whole or in part, prior to May 15, 2015, at a price equal to 100% of the principal amount thereof plus the make-whole premium described in the notes. Thereafter, Regent may redeem some or all of the Senior Secured Notes at the applicable redemption prices set forth in the notes. Regent may redeem up to 35% of the

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aggregate principal amount of the Senior Secured Notes on or prior to May 15, 2014 with the net cash proceeds of one or more equity offerings by Regent or its direct or indirect parent companies at a redemption price equal to 109.125% of the aggregate principal amount thereof, plus accrued and unpaid interest, under the conditions set forth in the notes.

Regent Newbuild Financing

On July 31, 2013, Regent entered into a loan agreement providing for borrowings of up to $440.0 million with a syndicate of financial institutions to finance 80% of the construction contract for the Seven Seas Explorer, the settlement of related euro foreign currency hedges and the export credit agency fee. The twelve-year fully amortizing loan requires semi-annual principal and interest payments commencing six months following the draw-down date. Borrowings under this loan agreement will bear interest, at the election of Regent, at either (i) a fixed rate of 3.43% per year, or (ii) six month LIBOR plus a margin of 2.80% per year. Regent is required to pay various fees to the lenders under this loan agreement, including a commitment fee of 1.10% per annum on the maximum undrawn loan amount payable semi-annually beginning January 2014. Obligations under the loan agreement are guaranteed by Regent and PCH. The Seven Seas Explorer loan is also 95% guaranteed to the lenders by SACE. As of December 31, 2013, no borrowings were outstanding under this loan agreement.

The Regent newbuild loan facility contains financial covenants, including a requirement for Regent to maintain a minimum liquidity balance, and for PCH to maintain a maximum total debt to EBITDA ratio, a minimum EBITDA to debt service ratio and a maximum total debt to total adjusted equity ratio as of the last day of the calendar year. EBITDA, as defined in the Regent newbuild loan agreement, includes certain adjustments for purposes of calculating these ratios. PCH is a guarantor of the Regent newbuild loan facility. As of December 31, 2013, we are in compliance with all newbuild loan financial covenants.

Related Party Debt


	December 31,
*(in thousands)*	2013		2012
Apollo Term Notes, 5% interest, due April 27, 2017	$	382,513	$	364,081
Apollo Term Notes, 5% interest, due June 19, 2017		69,040		65,714
Apollo Term Notes, non-interest bearing, due January 31, 2018		187,431		187,431
Apollo Term Notes, 5% interest, due May 18, 2019		62,816		59,789
Non-Apollo Term Notes, 5% interest, due August 1, 2019		16,492		15,697
Apollo Term Notes, 5% interest, due December 24, 2019		30,490		29,020
Non-Apollo Term Notes, 5% interest, due December 31, 2019		13,354		12,711
Apollo Term Notes, 5% interest, due May 6, 2020		62,167		59,172
Apollo Term Notes, 5% interest, due October 26, 2020		27,068		25,764
Non-Apollo Term Notes, 5% interest, due November 19, 2020		9,960		9,480

Total related party notes payable		861,331		828,859
Less: Unamortized discount on related party notes payable		149,714		167,555

Long-term portion of related party debt	$	711,617	$	661,304

Interest expense on related party notes was $32.5 million and $30.9 million in the year ended December 31, 2013 and 2012, respectively, and has been added to long-term related party notes payable in our consolidated balance sheets. Debt discount accretion of $17.8 million and $15.3 million for the year ended December 31, 2013 and 2012, respectively, is included in interest expense, net in the consolidated statements of operations. Our related party debt will be restructured and capitalized prior to the consummation of this offering.

In January 2008, we issued an aggregate principal amount of $512.4 million in promissory notes to Apollo. The promissory notes are subordinate to all third-party nontrading debt. A portion of the promissory notes, with an aggregate principal amount of $325.0 million (“5% Notes”), bear interest at a rate of 5% per annum,

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cumulative, compounding semi-annually. The remaining promissory notes, with an aggregate principal amount of $187.4 million, are non-interest bearing (the “Non-Interest Bearing Notes”). The principal and any interest are due upon note maturity. The promissory notes mature at the earlier of a qualified public offering (as defined in the notes), the sale of Prestige, or on the tenth anniversary of the issue date of the promissory notes.

Also in January 2008, we issued 8.1 million warrants to Apollo to purchase common stock bearing a 5% payment-in-kind dividend rate per annum, with dividends being cumulative, compounding semi-annually, and payable in additional warrants (the “5% Dividend Warrants”). An additional 4.7 million non-dividend paying warrants were also issued to Apollo in January 2008 in conjunction with the issuance of the Non-Interest Bearing Notes. All warrants issued in January 2008 have an exercise price of $40.02355, are immediately exercisable, and expire at the earlier of a qualified public offering (as defined in the warrant agreement), the sale of Prestige, or on the tenth anniversary of the issue date of the warrant agreement.

During 2009 and 2010, we issued an additional 16.2 million 5% Dividend Warrants to Apollo and 3.4 million 5% Dividend Warrants to certain other shareholders in conjunction with the issuance of additional 5% Notes in aggregate principal amounts of $150.0 million to Apollo and $32.7 million to certain other shareholders. The 5% Notes are subordinate to all third-party non-trading debt and bear interest at a rate of 5% per annum, cumulative, compounding semi-annually. The principal and interest are due upon note maturity. The 5% Notes mature at the earlier of a qualified public offering (as defined in the notes), the sale of Prestige or on the tenth anniversary of the effective date of the promissory note. All 5% Dividend Warrants issued in 2009 and 2010 have an exercise price of $9.25, are immediately exercisable and expire at the earlier of a qualified public offering (as defined in the warrant agreement), the sale of Prestige or on the tenth anniversary of the effective date of the warrant agreement.

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DESCRIPTION OF CAPITAL STOCK

The following description summarizes certain important terms of our capital stock, as they are expected to be in effect immediately prior to the completion of this offering. We expect to adopt amended and restated articles of incorporation and amended and restated by-laws that will become effective immediately prior to the completion of this offering, and this description summarizes the provisions that are expected to be included in such documents. Because it is only a summary, it does not contain all the information that may be important to you. For a complete description of the matters set forth in this “Description of Capital Stock,” you should refer to our form of amended and restated articles of incorporation and form of amended and restated by-laws, which are included as exhibits to the registration statement of which this prospectus forms a part, and to the applicable provisions of Panamanian law.

General

Our articles of incorporation authorize us to issue 100,000,000 shares of common stock, par value of $0.01 per share. As of the date of this prospectus, we had shares of common stock issued and outstanding.

Common Stock

Each holder of common stock is entitled to, among other things, (i) one vote on all matters submitted to a vote at a general shareholders’ meeting; (ii) share equally in dividends from sources legally available therefor as declared at our annual shareholders’ meeting; (iii) freely inspect the corporate books and records; and (iv) any rights set forth in our articles of incorporation or Panamanian law.

Each holder of common stock is entitled to vote on all matters submitted to a vote at a general shareholders’ meeting, including in connection with the following matters:

•

any proposed amendment to our articles of incorporation; and

•

the sale, transfer or disposition of all or substantially all of our assets.

Shareholders’ Meetings

General shareholders’ meetings may be ordinary or special. Ordinary meetings occur at least once a year at such place (within or outside of the Republic of Panama), date and hour as shall be fixed by the Board. Special meetings may take place when duly summoned for a specified purpose or purposes.

Ordinary meetings

At ordinary annual meetings of shareholders, the Board is elected and any other issues required by applicable law or our by-laws are approved. No annual ordinary meeting need be held if all actions required by the laws of Panama are taken by written consent in lieu of a meeting. At an ordinary meeting, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an ordinary meeting, business must be specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board, otherwise properly brought before the meeting by or at the direction of the Board, or otherwise properly brought before the meeting by a shareholder.

Special meetings

Special meetings may be called by the Chairman, the Chief Executive Officer, the President or at least a majority in voting interest of the shareholders. The order of business at each special meeting shall be determined by the chairman of such meeting, but such order of business may be changed by a majority in voting interest of those present in person or by proxy at such meeting and entitled to vote thereat.

Voting required

Resolutions are passed at shareholders’ meetings by the affirmative vote of a majority of those shares entitled to vote at such meeting and present or represented at the meeting.

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Notice and location

Notice to convene the ordinary annual meeting or an extraordinary shareholders’ meeting shall be given to each shareholder of record entitled to vote at such meeting not less than 10 nor more than 60 days before the day on which the meeting is to be held, by delivering written notice thereof to each shareholder personally, or by mailing a copy of such notice, postage prepaid, directly to each shareholder at its address as it appears in the records of the Issuer, or by transmitting such notice thereof to each shareholder by facsimile transmission or email or other form of recorded communication.

Quorum

Generally, at each meeting of the shareholders, the holders of a majority of the issued and outstanding shares entitled to vote at such meeting, present in person or represented by proxy, shall constitute a quorum for the transaction of business. In the absence of a quorum, a majority in voting interest of the shareholders present in person or represented by proxy and entitled to vote, or, in the absence of all the shareholders entitled to vote, any officer entitled to preside at, or act as secretary of, such meeting, shall have the power to adjourn the meeting from time to time, until shareholders holding the requisite amount of stock to constitute a quorum shall be present or represented. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally called.

Other Shareholder Rights

As a general principle, Panamanian law bars the majority of a corporation’s shareholders from imposing resolutions which violate its articles of incorporation, by-laws or Panamanian law, and grants any shareholder the right to challenge, within 30 days, any shareholders’ resolution that is illegal or that violates its articles of incorporation or by-laws, by requesting the annulment of said resolution and/or the injunction thereof pending judicial decision. Minority shareholders representing at least 5% of all issued and outstanding shares have the right to request a judge to call a shareholders’ meeting and to appoint an independent auditor to examine the corporate accounting books, the background of the company’s incorporation or its operation.

Under Panamanian law, existing shareholders benefit from a pre-emptive subscription right in the event of an authorized capital increase or issuance of new shares against cash contributions.

Neither Panamanian law nor our articles of incorporation limit the right of nonresident or foreign owners to hold or vote our common stock. In addition, there are no laws, decrees or regulations in Panama that may affect the remittance of dividends, interest or other payments to nonresident holders of our common stock.

Listing

We have applied to list our common stock on under the symbol “ .”

Transfer Agent and Registrar

will be appointed as the transfer agent and registrar for our common stock upon completion of this offering.

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Summary of Significant Differences between Shareholders’ Rights and Other Corporate Governance Matters Under Panamanian Corporation Law and Delaware Corporation Law

Prestige Cruises International is a Panamanian corporation ( “ sociedad anónima ”). The Panamanian corporation law was originally modeled after the Delaware General Corporation Law. As such, many of the provisions applicable to Panamanian and Delaware corporations are substantially similar, including (1) a director’s fiduciary duties of care and loyalty to the corporation, (2) a lack of limits on the number of terms a person may serve on the board of directors, (3) provisions allowing shareholders to vote by proxy and (4) cumulative voting if provided for in the articles of incorporation. The following table highlights the most significant provisions that materially differ between Panamanian corporation law and Delaware corporation law.


Panama		Delaware
Directors

Conflict of Interest Transactions . Transactions involving a Panamanian corporation and an interested director or officer are initially subject to the approval of the board of directors. At the next shareholders’ meeting, shareholders will have the right to disapprove the board of directors’ decision and to decide to take legal actions against the directors or officers who voted in favor of the transaction.		Conflict of Interest Transactions . Transactions involving a Delaware corporation and an interested director of that corporation are generally permitted if: (1) the material facts as to the interested director’s relationship or interest are disclosed and a majority of disinterested directors approve the transaction; (2) the material facts are disclosed as to the interested director’s relationship or interest and the stockholders approve the transaction; or (3) the transaction is fair to the corporation at the time it is authorized by the board of directors, a committee of the board of directors or the stockholders.

Terms . Panamanian law does not set limits on the length of the terms that a director may serve. Staggered terms are allowed but not required.		Terms . The Delaware General Corporation Law generally provides for a one-year term for directors. However, the directorships may be divided into up to three classes with up to three-year terms, with the years for each class expiring in different years, if permitted by the articles of incorporation, an initial by-law or a by-law adopted by the stockholders.

Number . The board of directors must consist of a minimum of three members, which could be natural persons or legal entities.		Number . The board of directors must consist of a minimum of one member.

Authority to take Actions . A simple majority of the board of directors is necessary and sufficient to take any action on behalf of the board of directors.		Authority to take Actions . The articles of incorporation or by-laws can establish certain actions that require the approval of more than a majority of directors.

Shareholder Meetings and Voting Rights
Quorum . The quorum for shareholder meetings must be set by the articles of incorporation or the by-laws. If the articles of incorporation and by-laws are silent on the quorum required for meetings, the practice in Panama is to require the presence of the shareholders or their proxies of 51% of the shares issued and outstanding with the right to vote to obtain quorum.		Quorum . For stock corporations, the articles of incorporation or by-laws may specify the number to constitute a quorum, but in no event shall a quorum consist of less than one-third of shares entitled to vote at a meeting. In the absence of such specifications, a majority of shares entitled to vote shall constitute a quorum.

Action by Written Consent . Panamanian law permits shareholder action without formally calling a meeting.		Action by Written Consent . Unless otherwise provided in the articles of incorporation, any action

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Panama		Delaware

		required or permitted to be taken at any annual meeting or special meeting of stockholders of a corporation may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action to be so taken, is signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and noted.

Other Shareholder Rights
Shareholder Proposals . Shareholders representing 5% of the issued and outstanding capital of the corporation have the right to request a judge to call a general shareholders’ meeting and to propose the matters for vote.		Stockholder Proposals . Delaware law does not specifically grant stockholders the right to bring business before an annual or special meeting. If a Delaware corporation is subject to the SEC’s proxy rules, a stockholder who owns at least $2,000 in market value, or 1% of the corporation’s securities entitled to vote, may propose a matter for a vote at an annual or special meeting in accordance with those rules.

Appraisal Rights . Shareholders of a Panamanian corporation do not have the right to demand payment in cash of the judicially determined fair value of their shares in connection with a merger or consolidation involving the corporation. Nevertheless, in a merger, the majority of shareholders could approve the total or partial distribution of cash, instead of shares, of the surviving entity.		Appraisal Rights . Delaware law affords stockholders in certain cases the right to demand payment in cash of the judicially-determined fair value of their shares in connection with a merger or consolidation involving their corporation. However, no appraisal rights are available if, among other things and subject to certain exceptions, such shares were listed on a national securities exchange or such shares were held of record by more than 2,000 holders.

Shareholder Derivative Actions . Any shareholder, with the consent of the majority of the shareholders, can sue on behalf of the corporation, the directors of the corporation for a breach of their duties of care and loyalty to the corporation or a violation of the law, the articles of incorporation or the by-laws.		Stockholder Derivative Actions . Subject to certain requirements that a stockholder make prior demand on the board of directors or have an excuse not to make such demand, a stockholder may bring a derivative action on behalf of the corporation to enforce the rights of the corporation against officers, directors and third parties. An individual may also commence a class action suit on behalf of himself and other similarly-situated stockholders if the requirements for maintaining a class action under the Delaware General Corporation Law have been met. Subject to equitable principles, a three-year period of limitations generally applies to such stockholder suits against officers and directors.

Inspection of Corporate Records . Shareholders representing at least 5% of the issued and outstanding shares of the corporation have the right to require a judge to appoint an independent auditor to examine the corporate accounting books, the background of the company’s incorporation or its operation.		Inspection of Corporate Records . A stockholder may inspect or obtain copies of a corporation’s stockholder list and its other books and records for any purpose reasonably related to a person’s interest as a stockholder.

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Panama		Delaware
Anti-takeover Provisions

Panamanian corporations may include in their articles of incorporation or by-laws classified board and super-majority provisions.		Unless Delaware corporations specifically elect otherwise, Delaware corporations may not enter into a “business combination,” including mergers, sales and leases of assets, issuances of securities and similar transactions, with an “interested stockholder,” or one that beneficially owns 15% or more of a corporation’s voting stock, within three years of such person becoming an interested stockholder unless: (1) the transaction that will cause the person to become an interested stockholder is approved by the board of directors of the target prior to the transactions; (2) after the completion of the transaction in which the person becomes an interested stockholder, the interested stockholder holds at least 85% of the voting stock of the corporation not including shares owned by persons who are directors and also officers of interested stockholders and shares owned by specified employee benefit plans; or (3) after the person becomes an interested stockholder, the business combination is approved by the board of directors of the corporation and holders of at least 66.67% of the outstanding voting stock, excluding shares held by the interested stockholder.

Previously Acquired Rights

In no event can the vote of the majority shareholders deprive the shareholders of a corporation of previously acquired rights. Panamanian jurisprudence and doctrine has established that the majority shareholders cannot amend the articles of incorporation and deprive minority shareholders of previously acquired rights nor impose upon them an agreement that is contrary to those articles of incorporation. Once a share is issued, the shareholders become entitled to the rights established in the articles of incorporation and such rights cannot be taken away, diminished nor extinguished without the express consent of the shareholders entitled to such rights. If by amending the articles of incorporation, the rights granted to a class of shareholders is somehow altered or modified to their disadvantage, those shareholders will need to approve the amendment unanimously.		No comparable provisions exist under Delaware law.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock, and no predictions can be made about the effect, if any, that market sales of our common stock or the availability of such common stock for sale will have on the market price prevailing from time to time. Nevertheless, the actual sale of, or the perceived potential for the sale of, our common stock in the public market may have an adverse effect on the market price for the common stock and could impair our ability to raise capital through future sales of our securities. See “Risk Factors—Risk factors related to the offering and to our common stock—The substantial number of shares of common stock that will be eligible for sale in the near future may cause the market price of our common stock to decline.”

Sale of Restricted Shares

Upon completion of this offering, we will have an aggregate of shares of common stock outstanding, excluding shares reserved for issuance upon exercise of options that have been granted under our stock option plans ( of which were exercisable at such date). Of these shares, the common stock to be sold in this offering will be freely tradable without restriction or further registration under the Securities Act, except for any shares which may be acquired by any of our “affiliates” as that term is defined in Rule 144 under the Securities Act, which will be subject to the resale limitations of Rule 144. The remaining shares of common stock outstanding will be restricted securities, as that term is defined in Rule 144, and may in the future be sold without restriction under the Securities Act to the extent permitted by Rule 144 or any applicable exemption under the Securities Act.

Lock-up Agreements

We refer you to “Underwriting—Lock-up Agreements.”

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MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following is a discussion of the material U.S. federal income tax considerations relevant to an investment decision by a U.S. Holder or a Non-U.S. Holder, as defined below, with respect to the common stock of the Issuer. The following discussion, in so far as it expresses conclusions as to the application of United States federal income tax consequences of the ownership and disposition of common stock of Prestige, is the opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP. This discussion does not purport to address the tax consequences of owning our common stock to all categories of investors, some of which (such as financial institutions, regulated investment companies, real estate investment trusts, tax-exempt organizations, insurance companies, U.S. expatriates, persons holding our common stock as part of a hedging, integrated, conversion or constructive sale transaction or a straddle, traders in securities that have elected the mark-to-market method of accounting for their securities, persons liable for alternative minimum tax, pass-through entities and investors therein, persons who own, actually or under applicable constructive ownership rules, 10% or more of our common stock, dealers in securities or currencies and U.S. Holders whose functional currency is not the U.S. dollar) may be subject to special rules. This discussion deals only with holders who purchase common stock in connection with this offering and hold the common stock as a capital asset. Moreover, this discussion is based on laws, regulations and other authorities in effect as of the date of this prospectus, all of which are subject to change, possibly with retroactive effect. You are encouraged to consult your own tax advisors concerning the overall tax consequences arising in your own particular situation under U.S. federal, state, local or foreign law of the ownership of our common stock (including consequences arising under U.S. federal estate and gift tax laws and the recently enacted Medicare contribution tax on certain investment income).

For purposes of this discussion, the term “U.S. Holder” means a beneficial owner of our common stock that is, for U.S. federal income tax purposes, (a) an individual who is a citizen or resident of the United States, (b) a domestic corporation, (c) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (d) a trust if either (1) a court within the United States is able to exercise primary jurisdiction over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (2) the trust has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person. A beneficial owner of our common stock that, for U.S. federal income tax purposes, is an individual, corporation, estate or trust and is not a U.S. holder is referred to below as a “Non-U.S. Holder.”

If a partnership holds our common stock, the tax treatment of a partner in such partnership will generally depend on the status of the partner and upon the activities of the partnership. If you are a partner in such a partnership holding our common stock, you are encouraged to consult your tax advisor.

U.S. Federal Income Taxation of U.S. Holders

Subject to the discussion of the “PFIC” rules below:

Distributions

Any distributions made by us with respect to our common stock to a U.S. Holder will generally constitute dividends taxable as ordinary income to the extent of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of those earnings and profits will be treated first as a nontaxable return of capital to the extent of the U.S. Holder’s tax basis in our common stock (determined on a share-by-share basis), and thereafter as capital gain. Because we are not a U.S. corporation, U.S. Holders that are corporations will not be entitled to claim a dividends-received deduction with respect to any distributions they receive from us. So long as our stock is considered readily tradable on an established securities market in the United States, dividends received by certain non-corporate U.S. Holders should, subject to applicable limitations, qualify as “qualified dividend income” eligible for preferential rates.

Amounts taxable as dividends generally will be treated as income from sources outside the United States and will, depending on your circumstances, be “passive” or “general” income which, in either case, is treated

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separately from other types of income for purposes of computing the foreign tax credit allowable to you. However, if (a) we are 50% or more owned, by vote or value, by United States persons and (b) at least 10% of our earnings and profits are attributable to sources within the United States, then for foreign tax credit purposes, a portion of our dividends would be treated as derived from sources within the United States. With respect to any dividend paid for any taxable year, the United States source ratio of our dividends for foreign tax credit purposes would be equal to the portion of our earnings and profits from sources within the U.S. for such taxable year, divided by the total amount of our earnings and profits for such taxable year.

Sale, Exchange or Other Disposition of Common Stock

A U.S. Holder generally will recognize capital gain or loss upon a sale, exchange or other taxable disposition of our common stock in an amount equal to the difference between the amount realized by the U.S. Holder from such disposition and the U.S. Holder’s tax basis in such stock. Capital gain of a non-corporate U.S. Holder is generally taxed at a lower rate than ordinary income where the holder has a holding period greater than one year. Such capital gain or loss will generally be treated as U.S. source income or loss, as applicable, for U.S. foreign tax credit purposes. A U.S. Holder’s ability to deduct capital losses is subject to certain limitations.

PFIC Status

The foregoing discussion assumes that we are not and will not become a “passive foreign investment company,” or “PFIC.”

A non-U.S. corporation generally will be a PFIC in any taxable year in which, after applying the relevant look-through rules with respect to the income and assets of its subsidiaries, either 75% or more of its gross income is “passive income” (generally including (without limitation) dividends, interest, annuities and certain royalties and rents not derived in the active conduct of a business) or the average value of its assets that produce passive income or are held for the production of passive income is at least 50% of the total value of its assets. In determining whether we meet the 50% test, cash is considered a passive asset and the total value of our assets generally will be treated as equal to the sum of the aggregate fair market value of our outstanding stock plus our liabilities. If we own at least 25% (by value) of the stock of another corporation, we will be treated, for purposes of the PFIC tests, as owning our proportionate share of the other corporation’s assets and receiving our proportionate share of the other corporation’s income.

Based on our current and currently anticipated method of operation, we believe that we should not be a PFIC for the 2013 taxable year or for the foreseeable future. However, because PFIC status is determined annually and depends on the composition of a company’s income and assets and the fair market value of its assets, there can be no certainty in this regard.

If we were found to be a PFIC for any taxable year in which a U.S. Holder held common stock, certain adverse U.S. federal income tax consequences could apply to such U.S. Holder, including a re-characterization of any capital gain recognized on a sale or other disposition of common stock as ordinary income, ineligibility for any preferential tax rate otherwise applicable to any “qualified dividend income,” a material increase in the amount of tax that such U.S. Holder would owe and the possible imposition of interest charges, an imposition of tax earlier than would otherwise be imposed and additional tax form filing requirements.

A U.S. Holder owning shares in a PFIC (or a corporation that might become a PFIC) might be able to avoid or mitigate the adverse tax consequences of PFIC status by making certain elections, including “qualified electing fund” (a “QEF”) or “mark-to-market” elections, if deemed appropriate based on guidance provided by its own tax advisor. We will use reasonable efforts to provide any information reasonably requested by a U.S. Holder in order to make such elections.

U.S. Federal Income Taxation of Non-U.S. Holders

Non-U.S. Holders generally will not be subject to U.S. federal income tax or withholding tax on dividends received from us on our common stock unless the income is effectively connected income (and, if an applicable

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income tax treaty so provides, the dividends are attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States).

Non-U.S. Holders generally will not be subject to U.S. federal income tax or withholding tax on any gain realized upon the sale, exchange or other disposition of our common stock, unless either:

•

the gain is effectively connected income (and, if an applicable income tax treaty so provides, the gain is attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States); or

•

the Non-U.S. Holder is an individual who is present in the U.S. for 183 days or more during the taxable year of disposition and certain other conditions are met, in which case such gain (net of certain U.S. source losses) generally will be taxed at a 30% rate (unless an applicable income tax treaty provides otherwise).

Effectively connected income will generally be subject to regular U.S. federal income tax in the same manner as discussed in the section above relating to the taxation of U.S. Holders, under an applicable income tax treaty provides otherwise. In addition, earnings and profits of a corporate Non-U.S. Holder that are attributable to effectively connected income, as determined after allowance for certain adjustments, may be subject to an additional branch profits tax at a rate of 30%, or at a lower rate as may be specified by an applicable income tax treaty.

Backup Withholding and Information Reporting

In general, payments of distributions on our common stock to a noncorporate U.S. Holder, and proceeds of a disposition of our common stock by a noncorporate U.S. Holder, will be subject to U.S. federal income tax information reporting requirements. Such amounts may also be subject to U.S. federal backup withholding tax if you are a noncorporate U.S. Holder and you:

•

fail to provide us with an accurate taxpayer identification number;

•

are notified by the IRS that you have become subject to backup withholding because you previously failed to report all interest or dividends required to be shown on your federal income tax returns; or

•

fail to comply with applicable certification requirements.

A Non-U.S. Holder that receives distributions on our common stock, or sells our common stock through the U.S. office of a broker, or a non-U.S. office of a broker with specified connections to the United States, may be subject to backup withholding and related information reporting unless the Non-U.S. Holder certifies that it is a non-U.S. person, under penalties of perjury, or otherwise establishes an exemption. Backup withholding tax is not an additional tax. You generally may obtain a refund of any amounts withheld under backup withholding rules that exceed your income tax liability by timely filing a refund claim with the IRS.

Tax Return Disclosure Requirement

Certain U.S. Holders (and to the extent provided in IRS guidance, certain Non-U.S. Holders) who hold interests in “specified foreign financial assets” (as defined in Section 6038D of the Code) are generally required to file an IRS Form 8938 as part of their U.S. federal income tax returns with information relating to the asset for each taxable year in which the aggregate value of all such assets exceeds $75,000 at any time during the taxable year or $50,000 on the last day of the taxable year (or such higher dollar amount as prescribed by applicable IRS guidance). “Specified foreign financial assets” generally include, among other assets, financial accounts maintained by foreign financial institutions, and our common shares, unless the shares are held through an account maintained with a financial institution. Substantial penalties may apply to any failure to timely file IRS Form 8938. Additionally, in the event an applicable U.S. Holder (and to the extent provided in IRS guidance, a Non-U.S. Holder) that is required to file IRS Form 8938 does not file such form, the statute of limitations on the assessment and collection of U.S. federal income taxes of such holder for the related tax year may not close until three years after the date that the required information is filed. You should consult your own tax advisors regarding your reporting obligations under this new legislation.

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CERTAIN PANAMANIAN TAX CONSEQUENCES

Panama’s income tax regime is based on territoriality principles, which define taxable income only as that revenue which is generated from a source within the Republic of Panama, or for services rendered outside of Panama, but which, by their nature, are intended to directly benefit the local commercial activities of individuals or corporations which operate within its territory. Said taxation principles have governed the Panamanian fiscal regime for decades and have been upheld through judicial and administrative precedent.

Although we are a Panamanian corporation, our income is not generated from sources within the Republic of Panama and is exempt from Panamanian income taxes. Payments of dividends by us are also exempt from dividend taxes. No Panamanian capital gain taxes will apply either on the sale or other disposition of the securities. There are no estate, gift or other taxes imposed by the Panamanian government that would affect a holder of the shares, whether such holder were Panamanian or a national of another country. The tax consequences described in this paragraph will apply to the extent we do not generate income from sources within the Republic of Panama.

There is currently no tax treaty between the United States and Panama. The above summary is based upon statutes, regulations, rulings and court decisions as in effect on the date hereof.

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UNDERWRITING

Under the terms and subject to the conditions contained in an underwriting agreement dated , 2014, we have agreed to sell to the underwriters named below, for whom is acting as a representative, the following respective numbers of shares of common stock:


Name		Number of Shares



Total

The underwriting agreement provides that the underwriters’ obligation to purchase shares of common stock depends on the satisfaction of the conditions contained in the underwriting agreement including:

•

the obligation to purchase all of the shares common stock offered hereby (other than those shares of common stock covered by their option to purchase additional shares as described below), if any of the shares are purchased;

•

the representations and warranties made by us to the underwriters are true;

•

there is no material change in our business or the financial markets; and

•

we deliver customary closing documents to the underwriters.

Commissions and Expenses

The following table summarizes the underwriting discounts and commissions we will pay to the underwriters. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase up to an additional shares. The underwriting fee is the difference between the initial price to the public and the amount the underwriters pay to us for the shares.


	Per Share		Total
	Without Over- allotment	With Over- allotment	Without Over- allotment	With Over- allotment
Underwriting discounts and commissions paid by us

The representative of the underwriters has advised us that the underwriters propose to offer the common stock directly to the public at the public offering price on the cover of this prospectus and to selected dealers, which may include the underwriters, at such offering price less a selling concession not in excess of $ per share. After the offering, the representative may change the offering price and other selling terms.

The expenses of the offering that are payable by us are estimated to be approximately $ (excluding underwriting discounts and commissions).

Option to Purchase Additional Shares

We have granted the underwriters an option exercisable for 30 days after the date of this prospectus, to purchase, from time to time, in whole or in part, up to an aggregate of shares at the public offering price less underwriting discounts and commissions. This option may be exercised if the underwriters sell more than shares in connection with this offering. To the extent the underwriters exercise this option, each underwriter will be committed, so long as the conditions of the underwriting agreement are satisfied, to purchase a number of additional shares proportionate to that underwriter’s initial commitment as indicated in the preceding table, and we will be obligated to sell the additional shares to the underwriters.

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Lock-Up Agreements

We, all of our directors and executive officers and our existing significant shareholders, including funds affiliated with Apollo, have agreed that, subject to certain exceptions without the prior written consent of the representative, we and they will not directly or indirectly, (1) offer for sale, sell, pledge, or otherwise dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any of our common stock (including, without limitation, shares of our common stock that may be deemed to be beneficially owned by us or them in accordance with the rules and regulations of the SEC and shares of our common stock that may be issued upon exercise of any options or warrants) or securities convertible into or exercisable or exchangeable for shares of our common stock, (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic consequences of ownership of the shares of our common stock, (3) make any demand for or exercise any right or file or cause to be filed a registration statement, including any amendments thereto, with respect to the registration of any shares of our common stock or securities convertible, exercisable or exchangeable into shares of our common stock or any of our other securities, or (4) publicly disclose the intention to do any of the foregoing for a period of days after the date of this prospectus.

The -day restricted period described in the preceding paragraph will be extended if:

•

during the last 17 days of the -day restricted period we issue an earnings release or material news or a material event relating to us occurs; or

•

prior to the expiration of the -day restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the -day period, in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or occurrence of a material event, unless such extension is waived in writing by the representative.

The representative, in its sole discretion, may release the shares of our common stock and other securities subject to the lock-up agreements described above in whole or in part at any time with or without notice. When determining whether or not to release shares of our common stock and other securities from lock-up agreements, the representative will consider, among other factors, the holder’s reasons for requesting the release, the number of shares of common stock and other securities for which the release is being requested and market conditions at the time.

Offering Price Determination

Prior to this offering, there has been no public market for our common stock. The initial public offering price will be negotiated between the representative and us. In determining the initial public offering price of our common stock, the representative will consider:

•

the history and prospects for the industry in which we compete;

•

our financial information;

•

the ability of our management and our business potential and earning prospects;

•

the prevailing securities markets at the time of this offering; and

•

the recent market prices of, and the demand for, publicly traded shares of generally comparable companies.

Indemnification

We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, liabilities arising from breaches of the representations and warranties contained in the underwriting agreement and to contribute to payments that the underwriters may be required to make for these liabilities.

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Stabilization, Short Positions and Penalty Bids

The underwriters may engage in stabilizing transactions, short sales and purchases to cover positions created by short sales, and penalty bids or purchases for the purpose of pegging, fixing or maintaining the price of our common stock, in accordance with Regulation M under the Exchange Act.

•

Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.

•

A short position involves a sale by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase in the offering, which creates the syndicate short position. This short position may be either a covered short position or a naked short position. In a covered short position, the number of shares involved in the sales made by the underwriters in excess of the number of shares they are obligated to purchase is not greater than the number of shares that they may purchase by exercising their option to purchase additional shares. In a naked short position, the number of shares involved is greater than the number of shares in their option to purchase additional shares. The underwriters may close out any short position by either exercising their option to purchase additional shares, in whole or in part, and/or purchasing shares in the open market. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through their option to purchase additional shares. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering.

•

Syndicate covering transactions involve purchases of our common stock in the open market after the distribution has been completed in order to cover syndicate short positions.

•

Penalty bids permit the representative to reclaim a selling concession from a syndicate member when our common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our common stock or preventing or retarding a decline in the market price of our common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. These transactions may be effected on the or otherwise and, if commenced, may be discontinued at any time.

Neither we, nor any of the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our common stock. In addition, neither we, nor any of the underwriters make representation that the underwriters will engage in these stabilizing transactions or that any transaction, once commenced, will not be discontinued without notice.

Electronic Distribution

A prospectus in electronic format may be made available on the Internet sites or through other online services maintained by one or more of the underwriters and/or selling group members participating in this offering, or by their affiliates. In those cases, prospective investors may view offering terms online and, depending upon the particular underwriter or selling group member, prospective investors may be allowed to place orders online. The underwriters may agree with us to allocate a specific number of shares for sale to online brokerage account holders. Any such allocation for online distributions will be made by the underwriters on the same basis as other allocations.

Other than the prospectus in electronic format, the information on any underwriter’s or selling group member’s website and any information contained in any other website maintained by an underwriter or selling

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group member is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or any underwriter or selling group member in its capacity as underwriter or selling group member and should not be relied upon by investors.

Stock Exchange

We intend to apply to list our common stock on under the symbol “ .”

Discretionary Sales

The underwriters have informed us that they do not intend to confirm sales to discretionary accounts that exceed 5% of the total number of shares offered by them.

Stamp Taxes

Purchasers of the common stock offered in this prospectus may be required to pay stamp taxes and other charges under the laws and practices of the country of purchase, in addition to the offering price listed on the cover page of this prospectus. Accordingly, we urge you to consult a tax advisor with respect to whether you may be required to pay those taxes or charges, as well as any other tax consequences that may arise under the laws of the country of purchase.

Relationships

The underwriters may in the future perform investment banking and advisory services for us from time to time for which they may in the future receive customary fees and expenses.

European Economic Area

In relation to each member state of the European Economic Area that has implemented the Prospectus Directive (each, a relevant member state), with effect from and including the date on which the Prospectus Directive is implemented in that relevant member state (the relevant implementation date), an offer of securities described in this prospectus may not be made to the public in that relevant member state prior to the publication of a prospectus in relation to the securities that has been approved by the competent authority in that relevant member state or, where appropriate, approved in another relevant member state and notified to the competent authority in that relevant member state, all in accordance with the Prospectus Directive, except that, with effect from and including the relevant implementation date, an offer of securities may be offered to the public in that relevant member state at any time:

•

to any legal entity that is authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities or

•

to any legal entity that has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts or

•

in any other circumstances that do not require the publication of a prospectus pursuant to Article 3 of the Prospectus Directive.

Each purchaser of securities described in this prospectus located within a relevant member state will be deemed to have represented, acknowledged and agreed that it is a “qualified investor” within the meaning of Article 2(1)(e) of the Prospectus Directive.

For purposes of this provision, the expression an “offer to the public” in any relevant member state means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to purchase or subscribe the securities, as the

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expression may be varied in that member state by any measure implementing the Prospectus Directive in that member state, and the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each relevant member state.

The sellers of the securities have not authorized and do not authorize the making of any offer of securities through any financial intermediary on their behalf, other than offers made by the underwriters with a view to the final placement of the securities as contemplated in this prospectus. Accordingly, no purchaser of the securities, other than the underwriters, is authorized to make any further offer of the securities on behalf of the sellers or the underwriters.

United Kingdom

This prospectus is only being distributed to, and is only directed at, persons in the United Kingdom that are qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive (“Qualified Investors”) that are also (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (ii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). This prospectus and its contents are confidential and should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any other persons in the United Kingdom. Any person in the United Kingdom that is not a relevant person should not act or rely on this document or any of its contents.

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LEGAL MATTERS

We are being represented by Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York, with respect to legal matters of United States federal securities and New York State law. The validity of the common shares offered in this offering and certain legal matters as to Panamanian law will be passed upon for us by Arias, Fabrega & Fabrega.

EXPERTS

The financial statements as of December 31, 2013 and 2012 and for each of the three years in the period ended December 31, 2013 included in this prospectus have been so included in reliance on the reports of PricewaterhouseCoopers LLP, an independent registered certified public accounting firm, given on the authority of said firm as experts in auditing and accounting.

ADDITIONAL INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the common stock offered under this prospectus. This prospectus, which is part of the registration statement, does not contain all of the information set forth in the registration statement and the exhibits to the registration statement. For further information with respect to us and this offering, you should refer to the registration statement and the exhibits filed as a part of the registration statement. If we have made references in this prospectus to any contracts, agreements or other documents and also filed any of those contracts, agreements or other documents as exhibits to the registration statement, you should read the relevant exhibit for a more complete understanding of the document or the matter involved.

Prestige Cruises International is subject to the informational requirements of the Exchange Act. We fulfill our obligations with respect to such requirements by filing periodic reports and other information with the SEC. We intend to furnish our shareholders with annual reports containing consolidated financial statements certified by an independent public accounting firm. The other information we file with the SEC is not part of the registration statement of which this prospectus forms a part. Our reports and other information that we have filed, or may in the future file, with the SEC are not incorporated by reference into and do not constitute part of this prospectus.

You may read and copy any document we have or will file with the SEC at the SEC’s internet website (http://www.sec.gov) or at the Public Reference Room of the SEC located at Room 1580, 100 F Street, N.E., Washington, D.C. 20549 at prescribed rates. You can call the SEC at 1-800-SEC-0330 to obtain information on the operation of the Public Reference Room.

You may obtain copies of this information, including the documents referenced in this prospectus and filed as exhibits to the registration statement of which this prospectus is a part, at no charge by writing or telephoning us at the following address and telephone numbers:

Prestige Cruises International, Inc.

8300 NW 33rd Street, Suite 100

Miami, Florida 33122

Investor Relations

(305) 514-2300

We also maintain internet sites at www.PrestigeCruiseHoldings.com, www.rssc.com and www.oceaniacruises.com . Our websites and the information contained therein or connected thereto will not be deemed to be incorporated into this prospectus or the registration statement of which this prospectus forms a part, and you should not rely on any such information in making your decision whether to purchase our common stock.

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Prestige Cruises International, Inc. and Subsidiaries

Index


	Page(s)
Report of Independent Registered Certified Public Accounting Firm		F-2

Consolidated Financial Statements:

Consolidated Balance Sheets as of December 31, 2013 and 2012		F-3

Consolidated for Statements of Operations for the Years Ended December 31, 2013, 2012 and 2011		F-4

Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2013, 2012 and 2011		F-5

Consolidated Statements of Stockholders’ Equity (Deficit) for the Years Ended December 31, 2013, 2012 and 2011		F-6

Consolidated Statements of Cash Flows for the Years ended December 31, 2013, 2013 and 2011		F-7

Notes to Consolidated Financial Statements		F-8

F-1

Report of Independent Registered Certified Public Accounting Firm

To the Board of Directors and Stockholders’ of

Prestige Cruises International, Inc. and Subsidiaries

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity (deficit) and cash flows present fairly, in all material respects, the financial position of Prestige Cruises International, Inc. and Subsidiaries at December 31, 2013 and 2012, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2013 in conformity with accounting principles generally accepted in the United States of America. In addition, in our, opinion, the financial statement schedules listed in the accompanying index present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Miami, Florida

March 24, 2014

F-2

Prestige Cruises International, Inc. .and Subsidiaries

Consolidated Balance Sheets

(in thousands, except number of shares and par value)


	As of December 31,
	2013			2012
Assets
Current assets
Cash and cash equivalents	$	286,419		$	139,556
Restricted cash		30,765			—
Trade and other receivables, net		16,277			15,951
Inventories		16,310			15,080
Prepaid expenses		45,588			35,030
Other current assets		14,722			14,091

Total current assets		410,081			219,708
Property and equipment, net		2,012,710			2,035,449
Goodwill		404,858			404,858
Intangible assets, net		81,324			83,556
Other long-term assets		80,913			128,539

Total assets	$	2,989,886		$	2,872,110

Liabilities and Stockholders’ Equity (Deficit)
Current liabilities
Accounts payable	$	12,236		$	14,252
Accrued expenses		98,725			93,651
Passenger deposits		414,757			355,385
Derivative liabilities		7,089			6,245
Current portion of long-term debt		90,326			17,560

Total current liabilities		623,133			487,093
Long-term debt		1,596,218			1,695,656
Related party notes payable		711,617			661,304
Other long-term liabilities		31,336			41,400

Total liabilities		2,962,304			2,885,453
Commitments and Contingencies
Stockholders’ equity (deficit)
Common stock, $0.01 par value. 100,000,000 shares authorized at 2013 and 2012; 13,569,765 and 13,572,515 share issued and outstanding at 2013 and 2012		136			136
Additional paid-in capital		307,030			305,642
Accumulated deficit		(223,280	)		(258,802	)
Accumulated other comprehensive loss		(56,249	)		(60,319	)
Treasury shares at cost, 6,000 shares held at 2013		(55	)		—

Total stockholders’ equity (deficit)		27,582			(13,343	)

Total liabilities and stockholders’ equity (deficit)	$	2,989,886		$	2,872,110

The accompanying notes are an integral part of these consolidated financial statements.

F-3

Prestige Cruises International, Inc. and Subsidiaries

Consolidated Statements of Operations

(in thousands, except shares and per share data)


	Years Ended December 31,
	2013			2012			2011
Revenues
Passenger ticket	$	1,001,610		$	947,071		$	834,868
Onboard and other		162,947			151,213			134,270
Charter		18,779			13,737			—

Total Revenue		1,183,336			1,112,021			969,138
Costs and expenses
Cruise operating expenses
Commissions, transportation and other		323,841			331,254			271,527
Onboard and other		43,518			40,418			36,854
Payroll, related and food		177,953			168,594			153,754
Fuel		101,690			101,685			92,921
Other ship operating		98,062			95,808			86,022
Other		16,416			21,968			26,305

Total cruise operating expenses		761,480			759,727			667,383
Selling and administrative		174,866			153,747			145,802
Depreciation and amortization		83,829			93,003			79,269

Total operating expenses		1,020,175			1,006,477			892,454

Operating income		163,161			105,544			76,684

Non-operating expense
Interest expense, net of capitalized interest		(141,634	)		(131,651	)		(101,560	)
Interest income		540			752			670
Other income (expense)		13,209			22,956			(45,901	)

Total non-operating expense		(127,885	)		(107,943	)		(146,791	)

Income (loss) before income taxes		35,276			(2,399	)		(70,107	)
Income tax benefit (expense)		246			(213	)		335

Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)

Earnings (Loss) Per Share
Basic	$	2.62		$	(0.19	)	$	(5.14	)

Diluted	$	1.88		$	(0.19	)	$	(5.14	)

Weighted-average share outstanding—Basic		13,571,828			13,571,827			13,564,766

Weighted-average share outstanding—Diluted		18,857,405			13,571,827			13,564,766

The accompanying notes are an integral part of these consolidated financial statements.

F-4

Prestige Cruises International, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

(in thousands)


			Years Ended December 31,
	2013		2012			2011
Net income (loss):	$	35,522	$	(2,612	)	$	(69,772	)
Other comprehensive income (loss)
Gain (loss) on change in derivative fair value		2,335		(4,600	)		33,980
Cash flow hedge reclassified into earnings		1,735		1,561			1,110

Total comprehensive income (loss)	$	39,592	$	(5,651	)	$	(34,682	)

The accompanying notes are an integral part of these consolidated financial statements.

F-5

Prestige Cruises International, Inc. and Subsidiaries

Consolidated Statements of Stockholders’ Equity (Deficit)

(in thousands)


	Common stock par value		Treasury shares at cost			Additional paid- in capital		Accumulated deficit			Accumulated other comprehensive loss			Total stockholders’ equity (deficit)
Balances at December 31, 2010	$	136	$	—		$	300,994	$	(186,418	)	$	(92,370	)	$	22,342
Net loss		—		—			—		(69,772	)		—			(69,772	)
Other comprehensive income		—		—			—		—			35,090			35,090
Issuance of common stock		—		—			164		—			—			164
Stock subscription receivable, net		—		—			195		—			—			195
Stock-based compensation		—		—			2,153		—			—			2,153

Balances at December 31, 2011		136		—			303,506		(256,190	)		(57,280	)		(9,828	)
Net loss		—		—			—		(2,612	)		—			(2,612	)
Other comprehensive loss		—		—			—		—			(3,039	)		(3,039	)
Issuance of common stock		—		—			7		—			—			7
Stock-based compensation		—		—			2,129		—			—			2,129

Balances at December 31, 2012		136		—			305,642		(258,802	)		(60,319	)		(13,343	)
Net income		—		—			—		35,522			—			35,522
Other comprehensive income		—		—			—		—			4,070			4,070
Issuance of common stock		—		—			17		—			—			17
Acquisition of treasury shares		—		(55	)		—		—			—			(55	)
Stock-based compensation		—		—			1,371		—			—			1,371

Balances at December 31, 2013	$	136	$	(55	)	$	307,030	$	(223,280	)	$	(56,249	)	$	27,582

The accompanying notes are an integral part of these consolidated financial statements.

F-6

Prestige Cruises International, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(in thousands)


	Years Ended December 31,
	2013			2012			2011
Cash flows from operating activities
Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		82,094			91,442			78,159
Amortization of deferred financing costs		12,599			12,679			10,131
Accretion of debt and related party notes payable discount		23,796			20,165			13,617
Cash flow hedge reclassified into earnings		1,735			1,561			1,110
Loss on early extinguishment of debt		1,895			4,487			7,502
Write-off of deferred financing costs and debt discount		2,500			87			(18	)
Prepayment penalty, excluded from loss on early extinguishment		(2,093	)		—			—
Stock-based compensation		1,371			2,129			2,153
Changes in fair value of derivative contracts		(18,399	)		(26,707	)		48,774
Interest expense on related party notes		32,472			30,908			29,418
Other, net		552			499			1,174
Changes in operating assets and liabilities:
Trade and other accounts receivables		(316	)		14,198			10,151
Prepaid expenses and other current assets		(9,533	)		(1,227	)		(9,794	)
Inventories		(1,223	)		(5,351	)		(6,294	)
Accounts payable and accrued expenses		477			16,784			25,781
Passenger deposits		67,275			29,026			44,225

Net cash provided by operating activities		230,724			188,068			186,317

Cash flows from investing activities
Purchases of property and equipment		(53,420	)		(478,962	)		(535,531	)
Settlement of derivative liability		—			(70,267	)		(63,074	)
Proceeds from leasehold reimbursement		245			251			1,716
Change in restricted cash		20,291			9,477			(2,401	)
Acquisition of intangible assets		(202	)		—			(4,443	)

Net cash used in investing activities		(33,086	)		(539,501	)		(603,733	)

Cash flows from financing activities
Proceeds from debt issuance		297,000			835,984			760,735
Debt related costs		(14,584	)		(31,540	)		(33,282	)
Payments on other financing obligations		(3,084	)		(2,000	)		—
Payments on long-term debt		(329,760	)		(443,830	)		(265,619	)
Change in restricted cash—newbuild letter of credit		—			(15,000	)		(15,000	)
Proceeds from share subscription		—			—			195
Issuance of common stock		17			7			164
Acquisition of treasury shares		(55	)		—			—
Offering costs		(277	)		—			—

Net cash (used in) provided by financing activities		(50,743	)		343,621			447,193

Effect of exchange rate changes on cash		(32	)		156			(200	)

Net increase (decrease) in cash and cash equivalents		146,863			(7,656	)		29,577
Cash and cash equivalents
Beginning of year		139,556			147,212			117,635

End of year	$	286,419		$	139,556		$	147,212

The accompanying notes are an integral part of these consolidated financial statements.

F-7

Notes to Consolidated Financial Statements

Note 1. General

In these consolidated financial statements, Prestige Cruises International, Inc. and its subsidiaries are collectively referred to as “PCI,” “we,” or “our.”

Description of Business

The accompanying consolidated financial statements include the accounts of Prestige Cruises International, Inc. (“PCI”) and its wholly owned subsidiaries, Prestige Cruise Holdings, Inc. (“PCH”), Oceania Cruises, Inc. and subsidiaries (“OCI”), and Seven Seas Cruises S. DE R.L. and subsidiaries (“SSC”), which operate cruise ships with destinations to Scandinavia, Russia, Alaska, the Caribbean, Panama Canal, South America, Europe, the Mediterranean, the Greek Isles, Africa, India, Asia, Canada and New England, Tahiti and the South Pacific, Australia and New Zealand. We are controlled by funds affiliated with Apollo Global Management, LLC (“Apollo”).

Basis for Preparation of Consolidated Financial Statements

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation.

2008 Reorganization

PCI was incorporated in Panama on January 30, 2008 as the new holding company of our business. Prior to the incorporation of PCI, PCH, which was incorporated on June 12, 2002, was the holding company for our business. On January 31, 2008, PCI entered into a transaction that resulted in the shareholders of PCH exchanging their preferred and common stock in PCH for PCI promissory notes, warrants, and common stock, as well as contributing funds of $529 million in exchange for common stock and promissory notes (“2008 Reorganization”). The contribution received from the shareholders was used by PCI to acquire common stock in PCH, and as a result, PCI became the owner of all the common stock of PCH. The funds contributed to PCH were used to acquire SSC in 2008.

Note 2. Summary of Significant Accounting Policies

Accounting Policies

We follow accounting standards established by the Financial Accounting Standards Board (“FASB”) in our reporting of financial condition, results of operations, and cash flows. References to GAAP in these footnotes are to the FASB Accounting Standards Codification , sometimes referred to as the Codification or ASC.

Use of Estimates

The preparation of the consolidated financial statements requires management to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include the carrying amount of property and equipment, accrued liabilities, intangible assets, goodwill, warrants, derivatives, and stock-based compensation. Actual results could differ from those estimates.

Cash Equivalents

We consider all highly liquid investments with maturities of three months or less when purchased to be cash equivalents.

F-8

Restricted Cash

As of December 31, 2013 and 2012, restricted cash was $43.4 million and $63.7 million, respectively, of which $30.8 million is included in current assets in 2013, and $12.6 million and $63.7 million is classified within other long-term assets in 2013 and 2012, respectively. The current portion of $30.8 million in 2013 consisted of $30.0 million of cash collateral for letters of credit issued for the OCI newbuild financing agreements, which per our contract will be released within 24 months after delivery of the Riviera and $0.8 million related to agreements with our previous credit card service provider that required us to escrow a certain amount of passenger deposits. The $12.6 million of long term restricted cash in 2013 relate to certain credit card processing agreements. In 2012, the long term restricted cash balance consisted of $30.0 million of cash collateral for letters of credit issued for the OCI newbuild financing agreements and $33.7 million related to required collateral to secure obligations under the Federal Maritime Commission (“FMC”), certain credit card processing agreements and surety bonds for our sales office located in the United Kingdom.

As of December 31, 2013 and 2012, we had outstanding and undrawn letters of credit of $42.1 million and $50.0 million, respectively. These agreements are collateralized by the restricted cash as described above and automatically renew each year.

Trade and Other Receivables, net

As of December 31, 2013 and 2012, trade receivables totaled $14.5 million and $13.3 million, respectively, consisted of processed credit card transactions in transit of $7.4 million and $7.4 million, respectively, and onboard receivables from concessionaires, passengers and other trade receivables of $7.1 million and $5.9 million, respectively. As of December 31, 2013 and 2012, the allowance for bad debt, which is netted against trade receivables in the consolidated balance sheets, totaled $0.6 million and $0.2 million, respectively.

As of December 31, 2013 and 2012, other receivables totaled $1.8 million and $2.6 million, respectively. The 2013 balance consisted of insurance receivables. The 2012 balance consisted primarily of insurance receivables and warranty claims related to ship repairs made on the Regatta and on the Marina .

Inventories

Inventories consist of hotel consumables, medical supplies, deck and engine supplies and fuel and oil onboard the vessels and are carried at the lower of cost or market. Cost is determined using the first-in, first-out (“FIFO”) method.

Property and Equipment

As of January 1, 2013, we changed our estimate for all our ships’ projected residual values. The estimate was reassessed due to recent sales and resale information for upscale cruise ships that we obtained during the first quarter of 2013. This new information, in conjunction with other comparable sale data points, was used in our analysis, which includes our consideration of anticipated technological changes, long-term cruise and vacation market conditions and replacement cost of similarly built vessels. As a result, we increased each ship’s projected residual value from 10% and 15% to 30%. The change in estimate has been applied prospectively as of January 1, 2013. The effect of the change on both operating income and net income for the year ended December 31, 2013 is approximately $16.4 million of reduced depreciation expense. We periodically review and evaluate these estimates and judgments based on historical experiences and new factors and circumstances. As part our ongoing reviews, our estimates may change in the future. If such a change is necessary, depreciation expense could be materially higher or lower.

Property and equipment are stated at cost less accumulated depreciation. Improvement costs that add value to our ships are capitalized as additions to the ship and depreciated over the lesser of the ships’ remaining service lives or the improvements’ estimated useful lives. The remaining estimated cost and accumulated depreciation

F-9

(i.e. book value) of replaced or refurbished ship components are written off and any resulting losses are recognized in the consolidated statements of operations.

Depreciation of the ships is computed net of projected residual values of 30% using the straight-line method over their original estimated weighted average lives. Depreciation of property and equipment not associated with the ships is computed using the straight-line method over their estimated useful lives of 3 to 5 years. Leasehold improvements are depreciated using the straight-line method over the shorter of the lease term or estimated useful life of the asset. Improvement costs that add value to the ships and have a useful life greater than one year are capitalized as additions to the ships and depreciated over the lesser of the ships’ remaining service lives or the improvements’ estimated life. Spare parts for the ships are classified as property and equipment in the consolidated balance sheets. Property under capital lease is initially recorded at the lower of the present value of minimum lease payments or fair value. Depreciation expense attributed to property under capital leases is included within depreciation and amortization expense in the consolidated statements of operations.

Drydock costs are scheduled maintenance activities that require the ships to be taken out of service and are expensed as incurred. Drydocks are required to maintain each vessel’s Class certification and are necessary for our ships to be flagged in a specific country, obtain liability insurance and legally operate as passenger cruise ships. Typical drydock costs include drydock fees and wharfage services provided by the drydock facility, hull inspection and certification related activities, external hull cleaning and painting below the waterline including pressure cleaning and scraping, additional below the waterline work such as maintenance and repairs on propellers and replacement of seals, cleaning and maintenance on holding tanks and sanitary discharge systems, related outside contractor services including travel and related expenses and freight and logistics costs related to drydock activities. Repair and maintenance activities are charged to expense as incurred.

Debt Issuance Costs

Debt issuance costs, primarily loan origination and related fees, are deferred and amortized over the term of the related debt. During 2013 and 2012, we recorded $8.3 million and $30.5 million in debt issuance costs. Debt issuance costs related to ships under construction are not amortized until there is a drawdown on the newbuild debt facility, which coincides with the delivery of the new ship. During 2013, we also recorded $11.2 million of debt issuance costs related to the Seven Seas Explorer newbuild scheduled for delivery in 2016. Drawdowns on newbuild debt facilities occurred in January 2011 for the Marina and in April 2012 for the Riviera , in conjunction with the delivery of each new ship.

During 2013, we wrote off $4.2 million in previously recorded deferred financing costs in connection with the refinancing of the SSC first lien credit facility and OCI first and second lien credit facilities. During 2012, in connection with the refinancing of SSC first lien credit facilities, we wrote off $4.4 million in previously recorded deferred financing costs. Approximately $6.1 million of previously recorded deferred financing costs were written off in 2011 in connection with the repayment of the outstanding SSC second lien term loan. These costs are included within other income (expense) in the consolidated statements of operations. See “Note 5. Debt ,” in accompanying notes to consolidated financial statements .

Deferred debt issuance costs are amortized to income using the effective interest method and are included net of amortization within other current assets and other long-term assets in the accompanying consolidated balance sheets. Amortization expenses related to the deferred debt issuance costs amounted to $12.6 million, $12.7 million and $10.1 million for the years ended December 31, 2013, 2012 and 2011, respectively, and are included in interest expense, net of capitalized interest, in the consolidated statements of operations.

Goodwill

We record goodwill as the excess of the purchase price over the estimated fair value of net assets acquired, including identifiable intangible assets. Goodwill associated with the purchase of SSC is attributable to numerous

F-10

factors including providing us with entry into the luxury cruise line business with a developed workforce who had knowledge in the luxury cruise business, a fully developed travel agent distribution network, positive past passenger experiences and a developed business plan with proven performance. We assess goodwill for impairment at the “reporting unit level” (“Reporting Unit”) at least annually and more frequently when events or circumstances dictate. We have determined that there is only one Reporting Unit.

The impairment review for goodwill allows us to first assess qualitative factors to determine whether it is necessary to perform the more detailed two-step quantitative goodwill impairment test. We would perform the two-step test if our qualitative assessment determined it is more-likely-than-not that a reporting unit’s fair value is less than its carrying amount. We may also elect to bypass the qualitative assessment and proceed directly to step one of the quantitative test. The impairment review for goodwill consists of a two-step process of first determining the estimated fair value of the Reporting Unit and comparing it to the carrying value of the net assets allocated to the Reporting Unit. If the estimated fair value of the Reporting Unit exceeds the carrying value, no further analysis or write-down of goodwill is required. If the estimated fair value of the Reporting Unit is less than the carrying value of its net assets, the implied fair value of the Reporting Unit is allocated to all its underlying assets and liabilities, including both recognized and unrecognized intangible assets, based on their fair value. If necessary, goodwill is then written down to its implied fair value.

Identifiable Intangible Assets

SSC acquired certain intangible assets of which value has been assigned to them based on our estimates. Intangible assets that have an indefinite life are not amortized, but are subject to an annual impairment test, or more frequently, when events or circumstances change.

The impairment review for intangible assets also allows us to first assess qualitative factors to determine whether it is necessary to perform a more detailed quantitative intangible assets impairment test. We would perform the quantitative test if our qualitative assessment determined it was more-likely-than-not that the intangible assets are impaired. We may also elect to bypass the qualitative assessment and proceed directly to the quantitative test. The indefinite-life intangible asset quantitative impairment test consists of a comparison of the fair value of the indefinite-life intangible asset with its carrying amount. If the carrying amount exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. If the fair value exceeds its carrying amount, the indefinite-life intangible asset is not considered impaired.

Other intangible assets assigned finite useful lives are amortized on a straight-line basis over their estimated useful lives or based on the assets pattern of cash flows. These assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable based on market and operational factors.

Derivative and Hedging Activities

We enter into various hedge contracts to manage and limit our exposure to fluctuations in foreign currency exchange rates, interest rates and fuel prices. We record our derivatives as assets and liabilities and recognize these hedges at estimated fair market value. If the derivative does not qualify as a hedge under these guidelines or is not designated as a hedge, changes in the fair market value of the derivative are recognized in other income (expense) in the consolidated statements of operations.

We designate at inception those derivatives which qualify for hedge accounting. The derivative instruments that hedge the variability of cash flows related to forecast transactions are designated as cash flow hedges. For these derivatives, the effective portion of the changes in the fair market value of the hedges are recognized as a component of accumulated other comprehensive income (loss) in the stockholders’ equity section of the consolidated balance sheets and are subsequently reclassified into the same line item as the forecast transaction when the hedge is settled. Any ineffective portion of the changes in the fair market value of the hedge are recognized as a component of other income (expense) in the consolidated statements of operations.

F-11

Cash flows for the hedging instruments are classified in the same category as the cash flow from the hedged items. If for any reason hedge accounting is discontinued, then any cash flow subsequent to the date of discontinuance will be classified consistent with the nature of the instrument. To qualify for hedge accounting, the hedging relationship between the hedging instruments and hedged items must be highly effective over a period of time in achieving the offset of changes in cash flows attributable to the hedged risk at the inception date. On an ongoing basis, we assess whether the derivative used in the hedging transactions is highly effective in offsetting changes in cash flow of the hedged item. If it is determined that a derivative is no longer highly effective as a hedge, the changes in fair value of the derivative are recognized in earnings immediately and reported in other income (expense) in the consolidated statements of operations.

We review our contracts and agreements on a regular basis to determine if embedded derivatives are included in the host contract. Embedded derivatives that meet the criteria for bifurcation are measured at fair value at inception and remeasured each reporting period. The changes in fair value are recognized in earnings and recorded in other income (expense) in the consolidated statements of operations.

Warrants

We account for our warrants in accordance with ASC Topic 480, Distinguishing Liabilities from Equity (“ASC 480”), which requires detachable warrants to be classified as permanent equity, temporary equity, or as assets or liabilities. In general, warrants that either require net-cash settlement or are presumed to require net-cash settlement are recorded as assets and liabilities at fair value and warrants that require settlement in shares are recorded as equity instruments. All of our warrants require settlement in shares and are accounted for as permanent equity. The warrants are recorded at fair value on the issuance date. The fair value of the warrants is determined using a Black-Scholes option pricing model, and is affected by changes in inputs to that model including our stock price, expected stock price, volatility, and contractual term.

Revenue and Expense Recognition

Onboard and other revenue consists of revenue derived from the sale of goods and services rendered onboard the ships (net of related concessionaire costs), travel insurance (net of related costs), and cancellation fees. Concessionary fees are recognized based on the contractual terms of the various concession agreements. Also included are gross revenues from pre- and post-cruise hotel accommodations, shore excursions, land packages, and related ground transportation.

Certain of our sales include free unlimited shore excursions (“FUSE”) or a free hotel stay or free land package, which have no revenues attributable to them. The costs for FUSE, free hotel stays and free land packages are included in commissions, transportation and other expenses in the consolidated statements of operations.

Charter revenue consists of charter hire fees, net of commissions, to bareboat charter our ship Insignia , to an unrelated party for a period of two years commencing on April 9, 2012. The charter agreement constitutes an operating lease and charter revenue is recognized on a straight-line basis over the charter term.

Cash collected in advance for future cruises is recorded as passenger deposit liabilities. Deposits for sailings traveling more than 12 months in the future are classified as long-term liabilities and included in other long-term liabilities in the consolidated balance sheets. We recognize the revenue associated with these cash collections in the period the sailing occurs. For cruises that occur over multiple periods, the revenue is prorated and recognized ratably in each period based on the overall length of the cruise. Cancellation fee revenues, along with associated commission expenses and travel insurance, if any, are recognized at the time the cancellation occurs when it is both earned and realized .

F-12

Other ship operating expense includes port, deck and engine, certain entertainment-related expenses, and hotel consumable expenses. Other expense consists primarily of drydock and ship insurance costs.

During 2012, we incurred costs related to unplanned repairs on two of our ships. In connection with these incidents, approximately $1.1 million of insurance recoveries were netted against related costs recorded in other ship operating expense in the consolidated statements of operations. There were no revenues in 2012 related to these incidents as the losses exceeded the insurance recoverable.

Advertising Costs

Advertising costs are expensed as incurred and included in selling and administrative expense in the consolidated statements of operations. Advertising expense totaled $67.0 million, $55.2 million and $58.2 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount to estimated undiscounted future cash flows expected to be generated. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount exceeds its fair value. During 2013 and 2012, there were no impairment charges recorded on our long-lived assets.

Income Taxes

We use the liability method of accounting for income taxes. Under the liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Foreign Currency Transactions

Foreign currency transaction gains and losses are recognized upon settlement of foreign currency transactions within other income (expense) in the consolidated statements of operations. In addition, for unsettled foreign currency transactions, gains and losses are recognized for changes between the transaction exchange rates and month-end exchange rates. We recorded net foreign currency transaction losses of $0.3 million, $3.6 million and $0.6 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Stock-Based Employee Compensation

Stock-based compensation expense is measured and recognized at fair value of employee stock option awards. We recognize compensation expense for all share-based compensation awards using the fair value method. Compensation expense for awards is recognized over the awards’ vesting periods.

F-13

For liability classified awards we re-measure the fair value of the options at each reporting period until the award is settled. We also estimate the amount of expected forfeitures when calculating compensation cost. If the actual forfeitures that occur are significantly different from the estimate, then we revise our estimates.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model. The estimated fair value of stock options, less estimated forfeitures, is amortized over the vesting period using the graded-vesting method. The expected volatility is based on a combination of historical volatility for peer companies. The risk-free interest rate is based on U.S. Treasury securities with a remaining term equal to the expected option’s life assumed at the date of grant. The expected term is based on the average of contractual life, vested period of the options, and expected employee exercise behavior. The estimated forfeiture rate represents an estimate which will be revised in subsequent periods if actual forfeitures differ from those estimates.

Earnings Per Share

Basis earning per share is computed by dividing net income by the weighted—average number of shares outstanding during each period. Diluted earnings per share is computed by dividing net income by the weighted-average number of shares and common stock equivalents outstanding during each period.

Segment Reporting

We operate two cruise brands, Oceania Cruises and Regent Seven Seas Cruises which are considered two operating segments. The operating segments have been aggregated as a single reportable segment based on the similarity of their economic characteristics as well as similar qualitative factors such as types of customers, regulatory environment, and products and services provided.

Foreign revenues for our cruise brands represent sales generated from outside the U.S. primarily by foreign tour operators and foreign travel agencies. Substantially all of our long-lived assets are located outside of the U.S. and consist principally of our ships.

Passenger ticket revenues for the year ended December 31, which are based on where the reservation originates, were as follows:


	2013			2012			2011
United States		73.1	%		74.7	%		76.0	%
Canada		10.8	%		10.8	%		10.8	%
All other countries		16.1	%		14.5	%		13.2	%

Contingencies—Litigation

On an ongoing basis, we assess the potential liabilities related to any lawsuits or claims brought against us. While it is typically very difficult to determine, we use our best judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss, if any, can be made. In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any. We accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated. Due to the inherent uncertainties related to the eventual outcome of litigation and potential insurance recoveries, it is possible that certain matters may be resolved for amounts materially different from any provisions or disclosures that we have previously made.

Reclassifications

Certain amounts in prior years have been reclassified to conform to current year’s presentation.

F-14

New Accounting Pronouncements

As of January 1, 2013, we adopted Financial Accounting Standards Board ASU 2011-11, Disclosures about Offsetting Assets and Liabilities . It requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. In 2013, this pronouncement was enhanced by ASU 2013-1, Balance Sheet Offsetting . This update clarifies that ordinary receivables are not within the scope of ASU 2011-11 and it applies only to derivatives, repurchase agreements, reverse purchase agreements and other securities lending transactions. The adoption did not materially impact our consolidated financial statements.

In February 2013, the Financial Accounting Standards Board issued ASU 2013-02 , Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. It requires an entity to present the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income, but only if the item reclassified is required under GAAP to be reclassified to net income in its entirety in the same reporting period. Entities must also cross-reference to other disclosures currently required under GAAP for other reclassification items to be reclassified directly to net income in their entirety in the same reporting period. This standard was effective beginning January 1, 2013. See “Note 9. Stockholders’ Equity” in the accompanying notes to the consolidated financial statements.

There are no other recently issued accounting pronouncements not yet adopted that we expect to have a material effect on the presentation or disclosure of our future consolidated operating results, cash flows or financial condition.

Note 3. Property and Equipment, Net

Property and equipment consists of the following:

(in thousands)


	As of December 31,
	2013			2012
Ships	$	2,384,792		$	2,339,984
Furniture, equipment and other		24,751			17,241
Less: Accumulated depreciation and amortization		(396,833	)		(321,776	)

Property and equipment, net	$	2,012,710		$	2,035,449

For the year ended December 31, 2013, there were approximately $56.4 million of capitalized additions including a progress payment for the Seven Seas Explorer newbuild of $22.0 million and ship improvements and refurbishments completed on the existing fleet. During 2012, there was approximately $30.8 million of capital additions including ship improvements and refurbishments completed on the existing fleet. For the years ended December 31, 2013, 2012, and 2011, approximately $0.1 million, $0.8 million (net of insurance reimbursements of $0.2 million) and $1.2 million, respectively, of property and equipment, net, were written-off as disposals. We capitalized interest costs of $0.7 million, $1.2 million and $2.8 million during 2013, 2012 and 2011, respectively.

In 2012, the delivery of the Riviera was delayed. In accordance with our contract, we received liquidating damages of $8.1 million. Of the monies received, $7.8 million was recorded as a reduction of the basis of the ship as there was no identifiable benefit in exchange for the payment. The remainder of the payment was used to reduce actual expenses incurred as a result of the delay.

F-15

Depreciation and amortization expense on assets in service amounted to $79.2 million, $88.3 million and $75.3 million for the years ended December 31, 2013, 2012 and 2011, respectively. Repair and maintenance expenses, excluding drydock expenses, were $26.9 million, $24.7 million and $20.6 million for the years ended December 31, 2013, 2012 and 2011, respectively and are recorded in other ship operating expenses in the consolidated statements of operations. Drydock expenses, recorded within other cruise operating expenses in the consolidated statements of operations, were $5.1 million, $6.8 million and $12.0 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Note 4. Goodwill and Identifiable Intangible Assets

Goodwill

In 2013 and 2012, we completed our annual goodwill impairment test and determined there was no impairment. We performed our annual impairment testing as of September 30th. We elected not to perform a qualitative assessment and instead performed the two-step quantitative goodwill impairment test. Based on the discounted cash flow model, we determined that the fair value of the reporting unit exceeded the carrying value and is therefore not impaired. The principal assumptions used in our cash flow model related to forecasting future operating results, includes discount rate, net revenue yields, net cruise costs including fuel prices, capacity changes, weighted-average cost of capital for comparable publicly-traded companies and terminal values, which are all considered level 3 inputs.

The estimation of fair value utilizing discounted expected future cash flows includes numerous uncertainties which require significant judgments when making assumptions of expected revenues, operating costs, selling and administrative expenses, capital expenditures, as well as assumptions regarding the cruise vacation industry competition and business conditions, among other factors. It is reasonably possible that changes in our assumptions and projected operating results above could lead to impairment of our goodwill. There were no triggering events that occurred between our impairment testing date and reporting date.

Identifiable Intangible Assets

In 2008, we recorded identifiable intangible assets consisting of trade names and customer relationships. The trade names acquired in this transaction, “Seven Seas Cruises” and “Luxury Goes Exploring,” were determined to have indefinite lives.

In 2011, we amended our agreement with Regent Hospitality Worldwide, which granted us exclusive and perpetual licensing rights to use the “Regent” trade name and trademarks (“Regent licensing rights”) in conjunction with cruises, subject to the terms and conditions stated in the agreement. The original 10 year license agreement to use the “Regent” trade name and trademarks was originally accounted for as an operating lease and is exclusive from the acquired trade names of “Seven Seas Cruises” and “Luxury Goes Exploring.”

The Regent licensing rights required an immediate payment of $5.1 million and deferred payments of $4.0 million over 2 years. The immediate payment of $5.1 million included payment for accrued royalty fees under the previous agreement. The payment was applied first to the liability for previously owed royalty fees with the remainder applied to the intangible asset and legal fees for $4.5 million. The $4.0 million deferred payments have been recorded net of a discount of $0.6 million relating to the present value of the deferred payments associated with the amended license agreement and were being accreted through February 2013. The resulting $7.9 million intangible asset is being amortized over an estimated useful life of 40 years. The amendment and subsequent capitalization of the Regent licensing rights had no impact on the acquired trade names as part of the Regent Seven Seas Transaction, as both transactions were separate and unrelated. The outstanding balance of $2.0 million was paid in February 2013. The liability was recorded in accrued expenses in the accompanying consolidated balance sheets.

On January 2013, the former President of SSC stepped down from his role and became a consultant to us. We entered into a separation agreement and an independent contractor agreement (“Agreements”) with the former President of SSC. Severance of $0.7 million was paid for the year ended December 31, 2012, pursuant to

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his then-existing employment agreement. The Agreements have terms of 24 months and have been treated as an intangible asset. At inception, the non-compete clause within the Agreements was valued at $0.6 million and represents an intangible asset in accordance with ASC 350— Intangibles. The intangible asset has a finite useful life and is being amortized over the term of the Agreements.

Our identifiable intangible assets, except the trade names acquired in the purchase of SSC, are subject to amortization over their estimated lives and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable based on market factors and operational considerations. Identifiable intangible assets not subject to amortization, such as trade names, are reviewed for impairment whenever events or circumstances indicate, but at least annually, by comparing the estimated fair value of the intangible asset with its carrying value.

We elected not to perform a qualitative assessment and instead performed the annual quantitative impairment test of our trade names as of September 30th using the relief-from-royalty method. The royalty rate used is based on comparable royalty agreements in the tourism and hospitality industry, which was applied to the projected revenue to estimate the royalty savings and discounted to derive the fair value at September 30th. The discount rate used was the same rate used in our goodwill impairment test. Based on the discounted cash flow model, we determined the fair value of our trade names exceeded their carrying value and are therefore not impaired. The estimation of fair value utilizing discounted expected future cash flows includes numerous uncertainties that require significant judgments when developing assumptions of expected revenues, operating costs, selling and administrative expenses, capital expenditures and future impact of competitive forces. It is reasonably possible that changes in our assumptions and projected operating results used in our cash flow model could lead to an impairment of our trade name.

As of December 31, 2013 and 2012, the net balance of identifiable intangible assets was $81.3 million and $83.6 million, respectively. The following tables provide information on the gross carrying amounts, accumulated amortization, and net balances of these identifiable intangible assets as of December 31, 2013 and 2012.

(in thousands)


	2013
	Gross Carrying Amount		Accumulated Amortization			Net
Regent licensing rights	$	7,892	$	(559	)	$	7,333
Customer relationships		14,205		(14,007	)		198
Non-compete agreement		615		(282	)		333

		22,712		(14,848	)		7,864
Intangible assets not subject to amortization:
Trade names		73,460		—			73,460

Identifiable intangible assets	$	96,172	$	(14,848	)	$	81,324

(in thousands)


	2012
	Gross Carrying Amount		Accumulated Amortization			Net
Regent licensing rights	$	7,892	$	(361	)	$	7,531
Customer relationships		14,205		(11,640	)		2,565

Intangible assets not subject to amortization:		22,097		(12,001	)		10,096
Trade names
Identifiable intangible assets		73,460		—			73,460

	$	95,557	$	(12,001	)	$	83,556

F-17

Intangible amortization expense for the years ended December 31, 2013, 2012 and 2011 was $2.8 million, $2.6 million and $2.5 million, respectively. The following table provides information about the future estimated amortization expense over the next five years for the identifiable intangible assets:

(in thousands)


For the year ended December 31,
2014	$	703
2015		223
2016		197
2017		197
2018		197

	$	1,517

Note 5. Debt

Long-term bank debt and senior secured notes consist of the following:

(in thousands)


	As of December 31,
	2013			2012
OCI term loan, first lien, through 2020	$	299,250		$	—
OCI term loan, first lien, due 2015		—			231,688
OCI term loan, second lien, due 2014		—			4,843
OCI term loan, second lien, due 2015		—			70,157
OCI Marina newbuild debt, due through 2023		424,123			446,445
OCI Riviera newbuild debt, due through 2024		471,611			471,611
SSC term loan, first lien, due through 2018		296,250			296,250
SSC senior secured notes, due 2019		225,000			225,000

Total Debt		1,716,234			1,745,994
Less: Debt discount		(29,690	)		(32,778	)

Carrying value of debt		1,686,544			1,713,216
Less: Current portion of long-term debt		(95,560	)		(22,322	)
Plus: Current portion of debt discount		5,234			4,762

Long-term portion	$	1,596,218		$	1,695,656

OCI First Lien Term Loan

In March 2011, OCI’s first lien term loan credit agreement was amended. After the amendment, $34.6 million of the outstanding principal balance was due to mature in April 2013 at a rate of LIBOR plus a margin of 2.25% and $231.7 million of the outstanding principal balance was due to mature in April 2015 at a rate of LIBOR plus a margin of 4.75%. The amendment was treated as a modification in accordance with the guidance in ASC 470: Debt, as the terms of the term loan were substantially the same before and after the amendment. Prior existing debt issuance costs and the new debt issuance costs associated with the amendment are being amortized over the life of the new term loan. The next scheduled principal payment for each of the term loans is at maturity.

In December 2012, the outstanding term loan principal balance of $34.6 million maturing in April 2013 was repaid. As such, OCI wrote off the entire loan balance and the associated deferred financing costs of $0.1 million, net of accumulated amortization of $0.7 million.

F-18

During July 2013, OCI repaid its outstanding $231.7 million first lien term loan and $75.0 million second lien term loan, as amended in connection with OCI first lien credit facility as discussed below.

OCI Second Lien Term Loan

In October 2012, OCI’s second lien term loan credit agreement was amended. Of the $75.0 million outstanding principal loan balance due to mature in April 2014, $70.2 million was extended 12 months, to mature in April 2015, at an increased rate of LIBOR plus a margin of 8.75%. The terms governing the remaining outstanding portion of the second lien term loan in the amount of $4.8 million did not change. The amendment was treated as a modification in accordance with the guidance in ASC 470: Debt, as the terms of the term loan were substantially the same before and after the amendment. Prior existing debt issuance costs and the new debt issuance costs were amortized over the life of the new term loan. During July 2013, OCI repaid its outstanding $75.0 million second lien term loan, as amended, in connection with the financing of the OCI first lien credit facility.

OCI First Lien Credit Facility

During July 2013, OCI entered into a new $375.0 million first lien credit facility consisting of a $300.0 million first lien term loan, which has a rate of LIBOR, with a floor of 1%, plus a margin of 5.75% and includes an original issue discount of 1% maturing July 2020. The first lien credit facility term loan requires quarterly payments of principal equal to 0.25% of the original principal amount of the term loan beginning in December 2013, with the remaining unpaid amount due and payable at maturity. Borrowings under the first lien term loan are prepayable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months of the closing date. This transaction also included a new revolving credit facility of $75.0 million replacing OCI’s previous revolving credit facility of $35.0 million. We applied ASC 470-50 Debt-Modifications and Extinguishments to this transaction. After evaluating the criteria as applicable to syndicated loans, the refinancing resulted in both an extinguishment of debt for certain creditors whose balances were entirely re-paid, and a debt modification for certain creditors whose terms were not substantially different before and after the amendment. The new fees paid and previously existing deferred financing costs were proportionally allocated between modification and extinguishment. Of the $5.4 million in fees, $4.7 million were capitalized and are being amortized over the remaining term of the new debt. New fees and previously existing deferred financing costs allocated to the extinguishment were included in the calculation of loss on early extinguishment of debt, which resulted in a loss of $1.9 million and was recorded within other income (expense) in the consolidated statement of operations for the year ended December 31, 2013.

OCI Revolving Credit Facility

OCI’s revolving credit facility of $75.0 million has a rate of LIBOR with a floor of 1%, plus a margin of 5.75% and matures in July 2018. OCI is required to pay a quarterly commitment fee of up to 0.5% on the aggregate unused and uncanceled commitments under the revolving credit facility.

At December 31, 2013 and 2012, the total undrawn amount available under the OCI revolving credit facility was $75.0 million and $35.0 million, respectively.

OCI Newbuild Financing

On April 27, 2012, OCI took delivery of Riviera and financed $539.0 million. This loan facility included funds to cover 80% of the construction contract of the ship, the settlement of the related euro foreign currency hedges and the balance of the export credit agency fee. The newbuild loan facility is 95% guaranteed to the lenders by Servizi Assicurativi del Commercio Estero (“SACE”), the official export credit agency of Italy. OCI is required to make 24 semi-annual principal payments on the loan commencing six months subsequent to the draw-down date of April 27, 2012. The loan facility is based on six-month LIBOR plus a margin of 0.55%.

F-19

However, if a market disruption event occurs as defined by the lenders, the floating interest rate can be amended to include an adjusted spread. As of December 31, 2013 the all-in interest rate, which did not include an adjusted spread, was 0.91%. The annual effective interest rate was 3.03%. In December 2012, OCI prepaid $44.9 million for the principal payments due in April and October 2013. The outstanding balance as of December 31, 2013, and 2012 totaled $471.6 million. Associated with the Riviera newbuild loan facility, PCI issued a $15.0 million letter of credit in 2012, which was issued for the benefit of the lenders and automatically renews each year. PCH guarantees this financing arrangement.

During 2012, the floating interest rate on the Riviera newbuild loan facility was amended to include an adjusted spread calculation that references the USD/EUR basis swap index and the IBOXX Euro Average, which is capped at 1%. In accordance with ASC 815-15-20, Derivatives and Hedging (“ASC 15”) we evaluated the characteristics of the adjusted spread and determined that it met the criteria of an embedded derivative as defined by the codification. We determined that this embedded derivative feature required bifurcation from its host contract in accordance with ASC 815. At inception, the bifurcation of the embedded derivative from the loan agreement resulted in a discount to the face value of the loan agreement of approximately $17.5 million, which is being amortized to interest expense over the life of the loan agreement under the effective interest method.

During October 2013 the lenders notified us that the market disruption event no longer existed and the adjusted spread would cease to apply as of the next interest period rate reset, on October 27, 2013. The fair value of the Riviera newbuild loan facility embedded derivative as of December 31, 2013 is $0.0 million as we estimate that the adjusted spread will no longer be activated for the remainder of the loan agreement. Debt discount accretion was $2.3 million and $1.7 million for the year ended December 31, 2013 and 2012, respectively.

On January 19, 2011, OCI took delivery of Marina and financed $535.7 million. Similar to the newbuild loan facility in place for Riviera, this loan facility included funds to cover 80% of the construction contract of the ship, the settlement of the related euro foreign currency hedges and the balance of the export credit agency fee. The newbuild loan facility is 95% guaranteed to the lenders by SACE. OCI is required to make 24 semi-annual principal payments on the loan commencing six months subsequent to the draw-down date of January 19, 2011. The loan facility is based on six-month LIBOR plus a margin of 0.55%. However, if a market disruption event occurs as defined by the lenders, the floating interest rate can be amended to include an adjusted spread. As of December 31, 2013 the all-in interest rate, including an adjusted spread, was 1.10%. The annual effective interest rate was 3.30%. In December 2012, OCI prepaid $22.3 million for the principal payment due in January 2013. The outstanding balance as of December 31, 2013 and 2012 totaled $424.1 million and $446.4 million, respectively. Associated with our Marina newbuild loan facility, PCI issued a $15.0 million letter of credit in 2011, which was issued for the benefit of the lenders and automatically renews each year. PCH guarantees this financing arrangement.

During 2012, the floating interest rate on the Marina newbuild loan facility was amended to include an adjusted spread calculation that references the USD/EUR basis swap index and the IBOXX Euro Average and is capped at 1%. In accordance with ASC 815, we evaluated the characteristics of the adjusted spread and determined that it met the criteria of an embedded derivative as defined by the codification. We determined that this embedded derivative feature required bifurcation from its host contract in accordance with ASC 815. At inception, the bifurcation of the embedded derivative from the loan agreement resulted in a discount to the face value of the loan agreement of approximately $16.6 million, which is being amortized to interest expense over the life of the loan agreement under the effective interest method.

During October 2013, the lenders notified us that the market disruption event no longer existed and the adjusted spread would no longer be required effective at the next scheduled interest rate reset on January 19, 2014. The fair value of the Marina newbuild loan facility embedded derivative as of December 31, 2013 is approximately $34,000. Debt discount accretion was $2.5 million for the years ended December 31, 2013 and 2012.

F-20

SSC First Lien Credit Facility

In August 2012, SSC terminated its previously existing $465.0 million credit facility, consisting of both a $425.0 million term loan and a $40.0 million revolving credit facility, with a syndicate of financial institutions. SSC repaid the outstanding term loan balance of $293.5 million, accrued interest of $1.0 million and third party fees of $0.1 million. SSC also wrote off approximately $4.4 million of previously recorded deferred financing costs associated with the terminated credit facility. The repayment of the debt met the liability derecognition criteria in ASC Topic 405, Extinguishment of Liabilities, and as such, a loss of $4.5 million on early extinguishment of debt was recorded and is included in other income (expense) in our consolidated statements of operations and within operating activities in our consolidated statements of cash flows.

Concurrent with the termination of the first lien credit facility, SSC entered into a $340.0 million credit agreement consisting of a $300.0 million term loan and a $40.0 million revolving credit facility with a unrelated syndicate of financial institutions. Borrowings under the term loan and revolving credit facility bear interest at LIBOR with a floor of 1.25%, and an applicable margin of either 4.75% or 5.0% based on the Total Senior Secured Bank Leverage Ratio (as defined in the credit agreement). The margin was 5.0%. The term loan requires quarterly payments of principal equal to $0.75 million beginning in December 2012, with the remaining unpaid amount due and payable at maturity. Borrowings under the term loan are repayable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months. The term loan matures on December 21, 2018, at which time all outstanding amounts under the term loan will be due and payable. In addition, SSC is required to pay a quarterly commitment fee of either 0.375% or 0.5%, based on a loan-to-value ratio, upon the aggregate unused and uncanceled commitments under the revolving credit facility. The current commitment fee is 0.5%. The revolving credit facility matures on August 21, 2017, at which time all outstanding amounts under the revolving credit facility will be due and payable. The proceeds from the credit agreement were used to repay the first lien term loan, as discussed above.

The $340.0 million credit agreement included an original issue debt discount of $3.0 million. This amount is recorded as a reduction to the gross debt and is being accreted over the agreement term using the effective interest method. We have presented the debt, net of the original debt discount in our consolidated balance sheets. The discount is not considered an asset separable from the debt and we have allocated the discount between current and long-term debt. Additionally, SSC recorded $6.8 million in debt issuance costs. Deferred debt issuance costs are amortized to income using the effective interest method and are included net of amortization within other current assets and other assets in the accompanying consolidated balance sheets.

In February 2013, SSC amended its previously existing $340.0 million credit agreement, consisting of a $300.0 million term loan and $40.0 million revolving credit facility. Interest on SSC’s term loan is calculated based upon LIBOR, with a floor of 1.25%, plus an applicable margin. In conjunction with this amendment, the applicable margin on the outstanding balance of $296.3 million was repriced to 3.5% from either 4.75% or 5.0% based on a leverage ratio in the original term loan. Borrowings under the amended term loan are prepayable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months of the amendment. SSC paid $3.7 million of accrued interest, $3.0 million for a prepayment penalty, $1.3 million in arranger fees and $0.2 million in legal fees in connection with the amendment. There was no change to the terms of the revolving credit facility or the maturity date of the term loan. There was also no impact on financial covenants, liquidity or debt capacity.

SSC applied ASC 470-50 Debt—Modifications and Extinguishments to this transaction. After evaluating the criteria as applicable to syndicated loans, the repricing resulted in an extinguishment of debt for certain creditors whose balances were entirely repaid. This repricing resulted in a debt modification for certain creditors whose terms were not substantially different before and after the amendment. The new fees paid and previously existing deferred financing costs were proportionally allocated between modification and extinguishment. Of the $4.5 million in fees, $3.1 million of the amendment fees were capitalized and are being amortized over the remaining term of the debt. New fees, previously existing deferred financing costs and debt discount of $1.2 million, $1.7 million and $0.8 million, respectively, allocated to the extinguishment were included in the calculation of gain or

F-21

loss on early extinguishment of debt, which resulted in a loss of $3.7 million and was recorded within other income (expense) in the consolidated statement of operations for the year ended December 31, 2013.

As of December 31, 2013 and 2012, the total undrawn amount available under the SSC revolving credit facility was $40.0 million.

SSC Senior Secured Notes

In May 2011, SSC issued $225.0 million of senior secured notes (the “Notes”) at a rate of 9.125% through a private placement with registration rights. The Notes are due on May 15, 2019, with interest payments due semi-annually beginning in November 2011. The net proceeds from the Notes after the initial purchasers’ discount and estimated fees and expenses of $7.4 million, were approximately $217.6 million. SSC used $140.7 million of the proceeds from the offering to repay the second lien term loan, $29.0 million to pay down its first lien term loan and the remainder as unrestricted cash. SSC registered the Notes with the SEC in May 2012. SSC has the ability to redeem the Notes prior to the due date.

SSC Newbuild Financing

Effective July 2013, SSC entered into a definitive contract with Italy’s Fincantieri shipyard to build a luxury cruise ship to be named the Seven Seas Explorer . Under the terms of the contract, SSC will pay €343.0 million or approximately $471.3 million (calculated on the applicable exchange rate at December 31, 2013) to Fincantieri for the new vessel. During July 2013, SSC made a payment of approximately $22.0 million to Fincantieri for the initial installment payment for Seven Seas Explorer .

In July 2013, SSC entered into a loan agreement providing for borrowings of up to approximately $440.0 million with a syndicate of financial institutions to finance 80% of the construction contract of Seven Seas Explorer, the settlement of related euro foreign currency hedges and the export credit agency fee. The twelve year fully amortizing loan requires semi-annual principal and interest payments commencing six months following the draw-down date. Borrowings under this loan agreement will bear interest, at our election, at either (i) a fixed rate of 3.43% per year, or (ii) six month LIBOR plus a margin 2.8% per year. SSC is required to pay various fees to the lenders under this loan agreement, including a commitment fee of 1.1% per year on the undrawn maximum loan amount payable semi-annually. Guarantees under this loan agreement are provided by SSC and PCH. The newbuild loan facility is 95% guaranteed to the lenders by Servizi Assicurativi del Commercio Estero (“SACE”), the official export credit agency of Italy. As of December 31, 2013, the total undrawn amount available under the loan agreement was approximately $440.0 million.

Debt Covenants

Our First Lien Credit Facilities contain a number of covenants that impose operating and financial restrictions including requirements that we maintain a maximum loan-to-value ratio, a minimum interest coverage ratio (applicable only to our revolving credit facilities, if drawn) and restrictions on our and our subsidiaries ability to, among other things, incur additional indebtedness, issue preferred stock, pay dividends on or make distributions with respect to our common stock, restrict certain transactions with affiliates, and sell certain key assets, principally our ships.

The newbuild loan facilities, as amended, contain financial covenants, including requirements that OCI and SSC maintain a minimum liquidity balance, that PCH as guarantor maintains a maximum total debt to EBITDA ratio, a minimum EBITDA to debt service ratio and a maximum total debt to adjusted equity ratio, on the last day of the calendar year. EBITDA, as defined in the loan agreement, includes certain adjustments for purposes of calculating the ratio. As of December 31, 2013, we are in compliance with all financial covenants.

F-22

The following schedule represents the annual maturities of third-party long-term debt (in thousands):


For the year ended December 31,
2014	$	95,560
2015		95,560
2016		95,560
2017		95,560
2018		376,810
Thereafter		957,184

Total	$	1,716,234

Interest expense on third-party debt, including interest rate swaps, was $70.4 million (net of capitalized interest of $0.7 million), $65.9 million (net of capitalized interest of $1.2 million) and $46.3 million (net of capitalized interest of $2.8 million) for the years ended December 31, 2013, 2012 and 2011, respectively.

Note 6. Related Party Notes Payable and Warrants

Initial Issuance

In connection with the 2008 Reorganization, we issued eleven promissory notes to Apollo totaling $512.4 million. The promissory notes are subordinate to all third-party non-trading debt. Eight of the promissory notes for a total of $325.0 million (“5% Notes”) bear interest at a rate of 5% per annum, cumulative, compounding semi-annually. The principal and interest are due upon note maturity. The other three promissory notes for a total of $187.4 million are non-interest bearing. The eleven promissory notes mature at the earlier of a qualified public offering, the sale of PCI, or on the 10 ^th anniversary of the issue date of the promissory note.

Also in 2008, PCI granted 8.1 million warrants to Apollo to purchase common stock bearing a 5% payment-in-kind (“PIK”) dividend rate per annum with dividends being cumulative, compounding semi-annually, and payable in additional warrants (“5% Dividend”). An additional 4.7 million non-dividend paying warrants were also granted to Apollo on January 31, 2008. All warrants granted on January 31, 2008 have an exercise price of $40.02355, are immediately exercisable, and expire at the earlier of a qualified public offering, the sale of PCI, or on the 10 ^th anniversary of the issue date of the warrant agreement.

The warrants have been accounted for as equity, as an increase to additional paid in capital, in accordance with ASC 480 Distinguishing Liabilities from Equity . As there were multiple classes of instruments (promissory notes, warrants, and common stock) issued during 2008, the proceeds were allocated to each type of instrument at the investor level based on the relative fair values on the issuance date in accordance with ASC 470 resulting in a discount to the promissory notes.

The value assigned at inception to the promissory notes, warrants, and common stock was $408.1 million, $215.4 million, and $234.7 million, respectively. The discount to the face value of the note was approximately $116.5 million, which is being amortized to interest expense over the ten-year period of the promissory note under the effective interest method. The annual effective interest rates range from 4.19% to 6.75%.

2010 and 2009 Issuances

During 2010 and 2009, we issued promissory notes totaling approximately $83.6 million and $99.2 million, which all occurred in conjunction with grants of 5% Dividend warrants to purchase common stock. Each issuance in 2010 and 2009 contain the same terms. The promissory notes are subordinate to all third-party non-trading debt and bear interest at a rate of 5% per annum, cumulative, compounding semi-annually. The principal and interest are due upon note maturity; there is no interest cancellation feature on these promissory notes. The

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promissory notes mature at the earlier of a qualified public offering, the sale of PCI or on the 10 ^th anniversary of the effective date of the promissory note. All warrants issued in 2010 and 2009 have an exercise price of $9.25, are immediately exercisable and expire at the earlier of a qualified public offering, the sale of PCI or on the 10 ^th anniversary of the effective date of the warrant agreement.

The warrants have been accounted for as equity in accordance with ASC 480 and the proceeds were allocated to promissory notes and warrants based on their relative fair values on the issuance date in accordance with ASC 470. The value assigned to each respective warrant issuance was initially recorded as a discount to the face value of the corresponding note with an offsetting increase to additional paid in capital. The debt discounts are being amortized to interest expense over the ten-year period of the promissory notes under the effective interest method. The annual effective interest rates range from 12.15% to 15.30% in 2013, 2012 and 2011. There were no issuances of promissory notes or warrants during 2013, 2012, 2011.

Related party notes payable, including accrued interest, consist of the following:

(in thousands)


	As of December 31,
	2013		2012
Apollo term notes, 5% interest, due April 27, 2017	$	382,513	$	364,081
Apollo term notes, 5% interest, due June 19, 2017		69,041		65,714
Apollo term notes, non-interest bearing, due January 31, 2018		187,431		187,431
Apollo term notes, 5% interest, due May 18, 2019		62,816		59,789
Non-Apollo term notes, 5% interest, due August 1, 2019		16,492		15,697
Apollo term notes, 5% interest, due December 24, 2019		30,490		29,020
Non-Apollo term notes, 5% interest, due December 31, 2019		13,354		12,711
Apollo term notes, 5% interest, due May 6, 2020		62,167		59,172
Apollo term notes, 5% interest, due October 26, 2020		27,068		25,764
Non-Apollo term notes, 5% interest, due November 19, 2020		9,960		9,480

		861,332		828,859
Less: Unamortized discount on related party notes payable		149,715		167,555

Long-term portion	$	711,617	$	661,304

The annual maturities of related party notes payable are due beginning in 2017 and through 2020.

Interest expense on related party notes was $32.5 million, $30.9 million and $29.4 million for the years ended December 31, 2013, 2012 and 2011, respectively, and has been added to long-term related party notes payable in the accompanying consolidated balance sheets. Debt discount accretion of $17.8 million, $15.3 million and $13.0 million for the years ended December 31, 2013, 2012 and 2011, respectively, is included in interest expense, net in the consolidated statements of operations.

Note 7. Derivative Instruments, Hedging Activities and Fair Value Measurements

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Interest Rate Risk

In July 2011, OCI entered into three forward starting interest rate swap agreements to hedge the variability of the interest payments related to the outstanding variable rate debt associated with the Marina newbuild financing. The first swap, with an amortizing notional amount of $450.0 million at inception, was effective beginning January 19, 2012 and matured on January 19, 2013. The second swap, with an amortizing notional amount of $405.4 million became effective on January 19, 2013 and matured on January 19, 2014. The third swap, with an amortizing notional amount of $360.8 million became effective January 19, 2014 and matures on January 19, 2015. All three interest rate swaps are designated as cash-flow hedges and qualify for hedge accounting treatment. The changes in fair value of the effective portion of the interest rate swaps are recorded as a component of accumulated other comprehensive income (loss) on our consolidated balance sheets.

In March 2013, OCI entered into three forward starting interest rate swap agreement to hedge the variability of the interest payments related to the variable rate debt associated with the Marina and Riviera newbuild loan facility. The Marina interest rate swap, with an amortizing notional amount of $300.0 million at inception, becomes effective January 20, 2015 and matured on January 19, 2016. The first Riviera interest rate swap, with an amortizing notional amount of $422.4 million at inception, became effective on October 28, 2013 and matures on October 27, 2014. The second Riviera interest rate swap, with an amortizing notional amount of $377.6 million at inception becomes effective October 27, 2014 and matures on October 27, 2015.

All OCI interest rate swaps are designated as cash-flow hedges and meet the requirements to qualify for hedge accounting treatment. The changes in fair value of the effective portion of the interest rate swaps are recorded as a component of accumulated other comprehensive income (loss) on our consolidated balance sheets. The total notional amount of interest rate swap agreements for OCI effective and outstanding as of December 31, 2013 and 2012 was $805.5 million and $427.7 million, respectively. There was no ineffectiveness recorded for the year ended December 31, 2013 and 2012.

During 2008, SSC entered into an interest rate swap agreement with a notional amount of $400.0 million to limit the interest rate exposure related to its long-term debt. This interest rate swap, which matured on February 14, 2011, was designated as a cash flow hedge and the change in fair value of the effective portion of the interest rate swap was recorded as a component of accumulated other comprehensive income (loss) in the accompanying consolidated balance sheets. SSC had no interest rate swaps outstanding as of December 31, 2013 and 2012.

Foreign Currency Exchange Risk

Our exposure to market risk for changes in foreign currency exchange rates relates to our Euro-denominated payments related to our newbuild ship contract, vessel drydock and other operational expenses denominated in currencies other than the U.S. dollar.

During August 2013, SSC entered into a foreign currency collar option with an aggregate notional amount €274.4 million ($377.1 million at December 31, 2013) to limit the exposure to foreign currency exchange rates for Euro denominated payments related to the ship construction contract for the Seven Seas Explorer . The notional amount of the collar represents 80% of the construction contract of the vessel due at delivery. This foreign currency collar option was designated as a cash flow hedge at the inception of the instrument and will mature June 2016. The estimated fair value of the foreign currency effective portion of the derivative was recorded as a component of accumulated other comprehensive income (loss) in the accompanying consolidated balance sheets. There was no ineffectiveness recorded as of December 31, 2013. Ineffective portions of the future changes in fair value of the instrument will be recognized in other income (expense) in the statement of operations.

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During 2012, we entered into foreign currency swaps with an aggregate notional amount of €2.8 million ($3.6 million as of December 31, 2012) to limit the exposure to foreign currency exchange rates for Euro denominated payments related to vessel drydock and other operational expenses. The foreign currency swaps do not qualify for hedge accounting; therefore, the changes in fair values of these foreign currency derivatives are recorded in other income (expense) in the accompanying consolidated statements of operations. There were no outstanding foreign currency swap agreements as of December 31, 2012.

Fuel Price Risk

Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our vessels. We use fuel derivative swap agreements to mitigate the financial impact of fluctuations in fuel prices. The fuel swaps do not qualify for hedge accounting; therefore, the changes in fair value of these instruments are recorded in other income (expense) in the accompanying consolidated statements of operations.

As of December 31, 2013 and 2012, we entered into the following fuel swap agreements:


	Fuel Swap Agreements
	As of December 31, 2013			As of December 31, 2012
	(in barrels)
2013		—			528,975
2014		495,900			224,550
2015		123,300			—

	Fuel Swap Agreements
	As of December 31, 2013			As of December 31, 2012
	(% hedged—estimated consumption)
2013		—	%		56	%
2014		50	%		24	%
2015		12	%		—	%

We have certain fuel derivative contracts that are subject to margin requirements. For these specific fuel derivative contracts, on any business day, we may be required to post collateral if the aggregate mark-to-market exposure exceeds $3.0 million. The amount of collateral required to be posted is an amount equal to the difference between the mark-to-market exposure and $3.0 million. As of December 31, 2013 and 2012, we were not in a liability position related to this counterparty and therefore, we were not required to post any collateral for our fuel derivative instruments.

At December 31, 2013 and 2012 the fair values and line item captions of derivative instruments designated as hedging instruments under FASB ASC 815-20 were:

(in thousands)


	Balance Sheet Location	Fair Value as of December 31,
	Balance Sheet Location	2013		2012
Foreign currency collar	Other long-term assets	$	2,702	$	—

Total derivative assets		$	2,702	$	—

Interest rate swaps	Current liabilities—derivative liabilities	$	7,055	$	2,206
Interest rate swaps	Other long-term liabilities		4,249		8,730

Total derivative liabilities		$	11,304	$	10,936

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At December 31, 2013 and 2012, the fair values and line item captions of derivative instruments not designated as hedging instruments under FASB ASC 815-20 were:

(in thousands)


	Balance Sheet Location	Fair Value as of December 31,
	Balance Sheet Location	2013		2012
Fuel hedges	Other current assets	$	1,657	$	1,179
Fuel hedges	Other long-term assets		194		1,608

	Total Derivatives Assets	$	1,851	$	2,787

Fuel hedges	Current liabilities—Derivative liabilities	$	—	$	278
Embedded derivatives	Current liabilities—Derivative liabilities		34		3,760
Embedded derivatives	Other long-term liabilities		—		15,330

	Total Derivatives Liabilities	$	34	$	19,368

The effect of derivative instruments qualifying and designated as hedging instruments on the consolidated financial statements for the year ended December 31, 2013 was as follows (in the tables below other comprehensive income is abbreviated as OCI):

(in thousands)


	Amount of Gain/(Loss) Recognized on OCI Derivative (Effective Portion)			Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)		Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)			Location of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion excluded from Effectiveness Testing)		Amount of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion excluded from Effectiveness Testing)
Interest rate swaps	$	(367	)		N/A	$	—			N/A	$	—
Foreign currency collars		2,702			Depreciation and amortization expense		(1,735	)		N/A		—

Total	$	2,335				$	(1,735	)			$	—

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The effect of derivative instruments qualifying and designated as hedging instruments on the consolidated financial statements for the year ended December 31, 2012 was as follows:

(in thousands)


	Amount of Gain (Loss) Recognized in OCI on Derivative Instruments (Effective Portion)			Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)		Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)			Location of Gain (Loss) Recognized in Income on Derivative Instruments (Ineffective Portion excluded from Effectiveness Testing)		Amount of Gain (Loss) Recognized in Income on Derivative Instruments (Ineffective Portion excluded from Effectiveness Testing)
Interest rate swaps	$	(4,600	)		Interest expense, net	$	—			N/A	$	—
Foreign currency collars		—			Depreciation and amortization expense		(1,561	)		N/A		—

Total	$	(4,600	)			$	(1,561	)			$	—

The effect of derivative instruments qualifying and designated as hedging instruments on the consolidated financial statements for the year ended December 31, 2011 was as follows:

(in thousands)


	Amount of Gain (Loss) Recognized in OCI on Derivative Instruments (Effective Portion)			Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)		Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)			Location of Gain (Loss) Recognized in Income on Derivative Instruments (Ineffective Portion excluded from Effectiveness Testing)		Amount of Gain (Loss) Recognized in Income on Derivative Instruments (Ineffective Portion excluded from Effectiveness Testing)
Interest rate swaps	$	(3,524	)		Interest expense, net	$	(2,814	)		N/A	$	—
Foreign currency collars		37,504			Depreciation and amortization expense		(1,110	)		N/A		—

Total	$	33,980				$	(3,924	)			$	—

The effect of derivative instruments not designated as hedging instruments on the consolidated financial statements for the years ended December 31, 2013, 2012 and 2011 was:

(in thousands)


	Location of Gain (Loss) Recognized in Income on Derivative Instruments	Amount of Gain (Loss) Recognized in Income on Derivative Instruments
		For the Years Ended December 31,
		2013		2012			2011
Foreign currency swaps	Other income (expense)	$	—	$	(165	)	$	87
Foreign currency collars	Other income (expense)		—		10,035			(47,193	)
Embedded derivatives	Other income (expense)		19,056		15,008			—
Fuel hedges	Other income (expense)		158		6,283			9,198

Total		$	19,214	$	31,161		$	(37,908	)

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Fair Value Measurements

GAAP establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs are inputs that reflect our assumptions which market participants would use in pricing the asset or liability based on the best available information under the circumstances. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:

•

Level 1 Inputs—Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.

•

Level 2 Inputs—Inputs other than quoted prices included within Level 1 that are observable for the asset and liability, either directly or indirectly.

•

Level 3 Inputs—Inputs that are unobservable for the asset or liability.

Fair Value of Financial Instruments

We use quoted prices in active markets when available to determine the fair value of our financial instruments. The fair values of our financial instruments that are not measured at fair value on a recurring basis are:

(in thousands)


	Carrying Value as of December 31,				Fair Value as of December 31,
	2013		2012		2013		2012
Long-term bank debt(a)	$	1,461,544	$	1,488,216	$	1,492,762	$	1,459,232
Senior secured notes		225,000		225,000		249,188		239,063
Long-term related party notes payable		711,617		661,304		877,129		632,724

Total	$	2,398,161	$	2,374,520	$	2,619,079	$	2,331,019

(a)	the December 31, 2013 and 2012 carrying value is net of $29.7 million and $32.8 million, respectively of debt discount.

Long-term bank debt: Level 2 inputs were used to calculate the fair value of our long-term debt which was estimated using the present value of expected future cash flows which incorporates our risk profile and, if applicable, the risk profile of SACE. The valuation also takes into account debt maturity and interest rate based on the contract terms.

Senior secured notes: Level 2 inputs were used to calculate the fair value of our Notes which was estimated using quoted market prices.

Long-term related party notes payable: Level 2 and 3 inputs are utilized to derive the fair value of our long-term related party notes payable. As described in “Note 6. Related Party Notes Payable and Warrants”, there are multiple classes of instruments (promissory notes, warrants and common stock) that are issued. Therefore, we have utilized an option pricing methodology to determine fair value. Level 2 inputs used in this methodology are risk-free rates and volatility, which are identical to our assumptions used to calculate our fair value equity awards in “Note 8. Share-Based Employee Compensation”. Level 3 inputs include our aggregate equity value, time to liquidity event date, dividend yields and breakpoints, which consider the rights, privileges and preferences of the various classes of the instruments. Our aggregate equity value was estimated using a weighted average of income and market approach method. Also, our dividend yield used was 0% as we do not anticipate paying dividends in the

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foreseeable future. There have been no issuances or repayments of the related party notes during the year ended December 31, 2013. Also, there were no movements of financial instruments in or out of Level 3 during the years ended December 31, 2013 and 2012.

Other financial instruments : Due to their short-term maturities and no interest rate, currency or price risk, the carrying amounts of cash and cash equivalents, restricted cash, passenger deposits, accrued interest, and accrued expenses approximate their fair values. We consider these inputs to be level 1 as all are observable and require no judgment for valuation.

The following table presents information about our financial instrument assets and liabilities that are measured at fair value on a recurring basis:

(in thousands)


	As of December 31, 2013								As of December 31, 2012
Description	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets
Derivative financial instruments(a)	$	4,553	$	—	$	4,553	$	—	$	2,787	$	—	$	2,787	$	—

Total Assets	$	4,553	$	—	$	4,553	$	—	$	2,787	$	—	$	2,787	$	—

Liabilities
Derivative financial instruments(b)	$	11,338	$	—	$	11,338	$	—	$	30,304	$	—	$	30,304	$	—

Total liabilities	$	11,338	$	—	$	11,338	$	—	$	30,304	$	—	$	30,304	$	—

(a)

As of December 31, 2013, derivative financial instruments of $1.7 million are classified as other current assets and $2.9 million are classified as other long-term assets in the consolidated balance sheets. As of December 31, 2012, $1.2 million was classified as other current assets and $1.6 million was classified in other long-term assets.

(b)

As of December 31, 2013, derivative financial instruments of $7.1 million are classified as derivative liabilities and $4.2 million are classified as other long-term liabilities in the consolidated balance sheets. As of December 31, 2012, $6.2 million was classified as derivative liabilities and $24.1 million was classified in other long-term liabilities.

Our derivative financial instruments consist of interest rate swaps, foreign currency exchange contracts, and fuel hedge swaps. Fair value is derived using the valuation models that utilize the income value approach. These valuation models take into account the contract terms such as maturity, and inputs such as forward interest rates, forward foreign currency exchange rates, forward fuel prices, discount rates, creditworthiness of the counter party and us, as well as other data points. The data sources utilized in these valuation models that are significant to the fair value measurement are classified as Level 2 sources in the fair value input level hierarchy.

Our derivative financial instruments also consist of embedded derivatives. Fair value is derived using the valuation models that utilize the income value approach. These valuation models take into account the contract terms such as maturity, and inputs such as forward interest rates, discount rates, IBOXX Euro Average, USD/EUR basis index, creditworthiness of the counter party and us, as well as other data points. The data sources utilized in these valuation models that are significant to the fair value measurement are classified as Level 2 sources in the fair value input level hierarchy.

Non-recurring Measurements of Non-financial Assets

Goodwill and indefinite-lived intangible assets not subject to amortization are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying

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value of these assets could not be fully recovered. For goodwill, if the carrying amount of the reporting unit exceeds the estimated discounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the reporting unit to its estimated fair value. For indefinite-lived intangible assets if the carrying amount of the asset exceeds the estimated discounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value.

Other long-lived assets, such as our ships, are reviewed for impairment whenever events or changes in circumstances indicate its carrying amount may not be recoverable. If the carrying amount exceeds the estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing its carrying amount to its estimated fair value. The estimation of fair value measured by undiscounted or discounted expected future cash flows would be considered Level 3 inputs.

N ote 8. Share-Based Employee Compensation

In 2008, PCI adopted the 2008 Stock Option Plan (“Plan”) whereby its board of directors may grant stock options to officers, key employees, consultants and directors. The Plan authorized grants of options of up to 4,720,000 shares of common stock for 2013 and 2012 and 4,500,000 shares of common stock for 2011. Options granted primarily vest proportionally over 3 years, 50% based on performance conditions and 50% based on employee service conditions. The contractual term of options granted during the years ended December 31, 2013 and 2012 is eight years.

During February 2013 and April 2012, the President and Chief Operating Officer of PCH was granted 100,000 and 600,000 options, respectively, to purchase PCI shares according to his employment contract. These options are time based and vest over 3 years on his employment anniversary date. The contractual term of these options is 8 years. Total compensation expense for these options was calculated at the PCI level. The fair value was estimated on the grant date using the Black-Scholes model which includes the fair value of PCI common stock determined at the approximate grant date. The estimated fair value of these stock options, totaled $0.3 million in 2013 and $1.4 million in 2012 and is amortized over the vesting period using the graded-vesting method.

On December 31, 2012, we modified approximately 489,000 performance based stock options of equity classified awards, including those options modified in December 2011. The modification was due to the change in expectation from improbable to probable that we would meet the performance condition. No other terms of the options were changed. We revalued these awards and recorded the full expense as of December 31, 2012.

In December 2011, the Board of Directors modified approximately 344,000 performance based stock options recorded as equity classified awards. These equity classified awards would have been forfeited due to failure to achieve the specified performance condition. The Board of Directors modified the performance conditions of these options to allow the options to vest provided that performance targets are met in 2012. This modification was accounted for as a cancellation and a replacement grant. The replacement grant was treated as a new issuance and the fair value was remeasured at the date of modification.

During June 2009, a special award of 1,000,000 options with a grant date fair value of $3.4 million was granted to our Chief Executive Officer and Chairman of the Board. These options vest over a four year period, 50% after the first 24 months, 25% after 36 months and 25% after 48 months. The contractual term of the special award options is eight years.

To determine fair value of our common stock, we used a weighted average of the market and income valuation approaches. Weightings were assigned to the income approach and market approaches, which produced an indication of the invested capital value on a freely tradable basis at the valuation dates. These weightings were based on (i) a minority investor placing considerable weight on the Income Approach value because it relies directly on our forecasted operating results and market-derived rates of return and (ii) to a lesser extent, the Market Approach, because it reflects current market pricing and earnings and relies on an analysis of our direct competitors, which are considered to be alternative investments to an investment in us.

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For the market approach, we analyzed comparable publicly-traded companies (the “Peer Group”). The data obtained from the Peer Group was converted to various standard valuation multiples. We used the enterprise value/revenue multiple and enterprise value/EBITDA multiple for the Peer Group. We considered these metrics to be the best indicators of free cash flows and the standard multiples used in a market valuation approach. These multiples were applied to our revenue and EBITDA, with equal weighting, to derive an enterprise value.

For the income approach, we used the discounted cash flow model to calculate the value of our total invested capital (debt and equity). An estimated cash flow growth rate was determined to reflect our estimate of our long-term prospects, to which we further applied a discount rate ranging from 12.5% to 14.3% in 2013, 2012 and 2011.

In order to compute our discount rate for the cash flow model, a weighted-average cost of capital (“WACC”) was determined. Our WACC is based on our capital structure consisting of both equity and debt. Our debt-to-capital ratio is projected to be 50% based on the expected long-term capital structure. The WACC was therefore weighted evenly between the cost of capital for debt and equity. The cost of debt capital was determined by considering a range of market rates for S&P B and BBB rated corporate bonds with similar terms. The remaining component of WACC, the cost of equity, is based on:

Risk-free rate of return—The risk-free rate is based on the yield of a 20-year treasury bond (the range was between (2.5% and 4.1%)

Equity risk premium—The equity risk premium is based on a compilation of equity risk premiums as compiled by various sources, such as Ibbotson & Associates, Pratt Range, Fama & French, etc.(5.75% was used throughout 2013, 2012 and 2011);

Industry Beta—Industry Beta is based on our comparable companies (the range was between x2.21 and x2.56); and

Size premium—Size premium is based on our market capitalization (the range was between 1.7% and 1.9%).

The differences between the rights, restrictions and preferences of the holders of common stock, warrants, and notes may result in potentially different future outcomes for each class. Therefore, to estimate the value of our common stock, it is necessary to allocate our enterprise value among the various classes of warrants, notes and common stock. To perform this allocation among the various instruments, we utilized the Black-Scholes option pricing model. From the common stock value derived in the Black-Scholes option pricing model, we added a further discount for lack of marketability (“DLOM”) of our common stock. We based the DLOM on the likelihood, timing and size of an initial public offering, forecasted dividends, and potential for industry consolidation. The DLOM used was 15%, for 2013, 2012 and 2011.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes model which includes the fair value of our common stock determined at the approximate grant date. The estimated fair value of stock options, less estimated forfeitures, is amortized over the vesting period using the graded-vesting method. Total compensation expense recognized for employee stock options was $1.4 million, $2.1 million and $2.2 million for the years ended December 31, 2013, 2012 and 2011, respectively, which is included within selling and administrative expense in the consolidated statements of operations. The total unrecognized compensation cost related to non-vested awards is $0.6 million for the year ended December 31, 2013. The weighted average period over which it is expected to be recognized is 1.5 years.

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The assumptions used in the Black-Scholes model to fair value equity awards are as follows:


	2013		2012
Expected dividend yield		—%		—%
Expected stock price volatility		36.37%—54.63%		36.37%—61.66%
Risk-free interest rate		0.45%—0.85%		0.25%—1.03%
Expected option life		3.3-5 years		2-5 years

Since our common stock is not publicly traded, it is not practical to estimate the expected volatility of our share price. Therefore, the expected volatility is based on a combination of historical volatility for peer companies. The risk-free interest rate is based on U.S. Treasury securities with a remaining term equal to the expected option’s life assumed at the date of grant. The expected term is based on the average of contractual life, vested period of the options and expected employee exercise behavior. The estimated forfeiture rate represents an estimate which will be revised in subsequent periods if actual forfeitures differ from those estimates. The weighted average fair value of stock options granted during 2013, 2012 and 2011 was approximately $2.38 per share, $1.77 per share, and $1.64 per share, respectively. Stock option activity is summarized in the following table:


	Number of Options			Weighted - Average Exercise Price ($)		Weighted- Average Remaining Contractual Term (in years)
Outstanding at January 1, 2013		4,152,354		$	13.28		5.08
Granted		456,500			6.46
Exercised		(3,500	)		5.66
Forfeited or expired		(116,415	)		14.47

Outstanding at December 31, 2013		4,488,939			12.64		5.08

Vested and expected to vest at December 31, 2013		4,476,187			12.66		4.47
Options exercisable at December 31, 2013		3,877,207			13.70		4.13

The total fair value of shares vested during the years ended December 31, 2013 and 2012 was $2.0 million and $2.3 million, respectively. At December 31, 2013 and 2012, the aggregate intrinsic value of options vested and expected to vest is $34.0 million and $0.8 million, respectively. The aggregate intrinsic value of options exercisable at December 31, 2013 and 2012 is $27.6 million and $0.3 million, respectively. There were no exercises of options that resulted in a material amount of cash received.

Note 9. Stockholders’ Equity

Common stock

Our authorized common stock as of December 31, 2013 and 2012 consisted of 100 million shares of common stock with a par value of $0.01 per share. We had 13.6 million shares of common stock issued and outstanding as of December 31, 2013 and 2012.

The holders of our common stock are entitled to one vote per share and participate equally in all dividends payable or distributions. Upon liquidation, dissolution, or winding up of PCI, holders of our common stock are entitled to receive a ratable share of the available net assets of PCI after payment of all debts and other liabilities. Our common stock has no preemptive, subscription, redemption or conversion rights.

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Accumulated Other Comprehensive Loss

(in thousands)


	Changes related to Cash Flow Hedge
	2013			2012
Beginning balance	$	(60,319	)	$	(57,280	)

Other comprehensive income before reclassifications		2,335			(4,600	)
Amount reclassified from accumulated other comprehensive income		1,735			1,561

Net current period other comprehensive income		4,070			(3,039	)

Ending balance	$	(56,249	)	$	(60,319	)

Accumulated other comprehensive loss as of December 31, 2013, 2012 and 2011 was $56.2 million, $60.3 million and $57.3 million, respectively, which is primarily comprised of changes in derivative fair value of cash flow hedges for OCI’s new build ships. Since the cash flow hedges involve the purchase of fixed assets, they are considered forecasted transactions. As such, the gain or loss on the foreign currency cash flow hedges that are deferred in and classified as other comprehensive loss are being reclassified into earnings as the ships are depreciated over their estimated useful lives.

OCI’s original foreign currency collar associated with the Riviera newbuild matured in August 2011. The Riviera was delivered in April 2012 and as such, $15.7 million related to the collar will remain in other comprehensive loss and will be recognized within depreciation expense over the ship’s useful life. Our original foreign currency collar associated with the Marina newbuild matured in October 2010. The Marina was delivered in January 2011 and as such, $36.3 million related to the collar will remain in other comprehensive loss and will be recognized within depreciation expense over the ship’s useful life. For the years ended December 31, 2013, 2012 and 2011, $1.7 million, $1.6 million and $1.1 million, respectively, was reclassified from accumulated other comprehensive loss to depreciation and amortization expense in the consolidated statements of operations.

Note 10. Earnings (Loss) Per Share

Our basic and diluted earnings per share were computed as follows:

(in thousands, except per share data)


	Years ended December 31
	2013		2012			2011
Net income (loss) for basic and diluted earnings per share	$	35,522	$	(2,612	)	$	(69,722	)

Weighted-average common stock outstanding		13,572		13,572			13,565
Dilutive effect of equity plan		1,109		—			—
Dilutive effect of warrants		4,176		—			—

Diluted weighted-average shares outstanding		18,857		13,572			13,565

Basic earnings per share	$	2.62	$	(0.19	)	$	(5.14	)

Diluted earnings per share	$	1.88	$	(0.19	)	$	(5.14	)

Anti-dilutive equity awards excluded from diluted earnings per share computation		—		—			—

Note 11. Related Party Transactions

OCI incurred Apollo management fees of $0.9 million in 2013, 2012 and 2011. These expenses are included in selling and administrative expenses in the accompanying consolidated statements of operations.

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Note 12. Income Taxes

We had an income tax benefit for the year ended December 31, 2013 of $0.2 million. We had income tax expense for the year ended December 31, 2012 of $0.2 million and income tax benefit for the year ended December 31, 2011 of $0.3 million.

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of December 31, 2013 and 2012, relate primarily to net operating losses, depreciable assets, and book expenses not currently deductible for tax purposes. At December 31, 2013 and 2012, we had recorded deferred tax assets of approximately $31.2 million and $23.9 million, respectively, for which a full valuation allowance has been recorded. The increase in the valuation reserve is primarily due to net operating loss carryforwards generated in 2013.

In addition, we have recorded deferred tax liabilities of $1.5 million and $1.7 million for 2013 and 2012, respectively, which are recorded in other long-term liabilities in the accompanying consolidated balance sheets.

As of December 31, 2013, we have federal, state, and foreign net operating loss carryforwards of approximately $81.5 million, $0.4 million, and $0.0 million, respectively. The federal and state net operating loss carryforwards at December 31, 2013 expire between 2023 and 2033.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, we have recorded a full valuation allowance on our deferred tax assets.

We have analyzed our filing positions in all of the jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. We have identified tax returns in France, the United Kingdom, and the United States as “major” tax jurisdictions, as defined. The only periods subject to examination for our returns are the 2010 and 2011 tax years for France, 2011 through 2013 tax years for the United Kingdom and 2010 through 2013 tax years for the United States.

(in thousands)


	Balance at beginning of period		Charged to costs and expenses ⁽¹⁾		Balance at end of period
December 31, 2013	$	23,892	$	7,302	$	31,194
December 31, 2012	$	15,858	$	8,034	$	23,892
December 31, 2011	$	11,784	$	4,074	$	15,858

(1)	Increases in valuation allowance related to the generation of net operating losses and other deferred tax assets. No write-offs were recorded during the years presented.

United States Federal Income Tax

We derive our income from the international operation of ships. Under Section 883 of the Code (“Section 883”), certain foreign corporations, though engaged in the conduct of a trade or business within the United States, are exempt from U.S. federal income and branch profit taxes on gross income derived from or incidental to the international operation of ships. Applicable U.S. Treasury regulations provide that a foreign corporation will qualify for the benefits of Section 883 if, in relevant part, (i) the foreign country in which the corporation is organized grants an equivalent exemption for income from the operation of ships of sufficiently broad scope to corporations organized in the U.S., and (ii) the foreign corporation is a controlled foreign

F-35

corporation (a “CFC”) for more than half of the taxable year, and more than 50% of its stock is owned by qualified U.S. persons for more than half of the taxable year (the “CFC test”). Our 2012 tax returns were filed with tax authorities under Section 883 and our 2013 tax returns will also be filed under Section 883.

For U.S. federal income tax purposes, SSC and its non-U.S. subsidiaries are disregarded as entities separate from us and OCI is treated as a corporation. Both OCI and SSC rely on our ability as their parent corporation to meet the requirements necessary to qualify for the benefits of Section 883. We are organized as a company in Panama, which grants an equivalent tax exemption to U.S. corporations, and is thus classified as a qualified foreign country for purposes of Section 883. We are currently classified as a CFC and we believe we meet the ownership and substantiation requirements of the CFC test under the regulations. Therefore, we believe most of our income and the income of our ship-owning subsidiaries, which is derived from or incidental to the international operation of ships, is exempt from U.S. federal income taxation under Section 883. In 2005, final regulations became effective under Section 883, which, among other things, narrow somewhat the scope of activities that are considered by the Internal Revenue Service to be incidental to the international operation of ships. The activities listed in the regulations as not being incidental to the international operation of ships include income from the sale of air and land transportation, shore excursions, and pre- and post-cruise tours. To the extent the income from these activities is earned from sources within the United States that income is subject to U.S. taxation.

Individual State Income Taxes

We are subject to various U.S. state income taxes generally imposed on each state’s portion of the U.S. source income subject to federal income taxes. However, the state of Alaska imposes an income tax on its allocated portion of the total income of companies doing business in Alaska.

United Kingdom Corporation Tax

The Seven Seas Navigator and Seven Seas Voyager were operated by subsidiaries that were strategically and commercially managed in the United Kingdom (UK), and those subsidiaries elected to enter the UK tonnage tax regime. Effective February 4, 2013, both ships exited the UK tonnage regime upon transfer of the ships to the U.S. subsidiaries.

Corporate tax rate reductions from 23% to 21%, effective April 1, 2014 and from 21% to 20% effective April 1, 2015 were enacted in the United Kingdom on July 17, 2013. The effect of tax rate changes on existing deferred tax balances is recorded in the period in which the tax rate change law is enacted. The effect of these tax rate changes was the recognition of a deferred tax benefit of $0.2 million for the year ended December 31, 2013.

Panamanian and Other Foreign Income Taxes

Under Panamanian law, we are exempt from income tax on income from international transportation and should also be exempt from income tax in the other jurisdictions where the ships call if a tax treaty exists or when Panama grants a reciprocal exemption to countries who grant a reciprocal exemption to Panama. However, not all of the countries in which our ships call have income tax treaties or reciprocal exemption agreements with Panama. Accordingly, we may be subject to income tax in various countries depending on the tax laws of the specific countries upon which ports the ships call. In addition to or in place of income taxes, virtually all jurisdictions where our ships call impose taxes based on passenger counts, ship tonnage or some other measure. These taxes are recorded as other ship operating expenses in the accompanying consolidated statements of operations.

Note 13. Concentration Risk

We contract with a single vendor to provide many of our hotel and restaurant services including both food and labor costs. We incurred expenses of $115.4 million, $109.6 million and $101.2 million for the years ended December 31, 2013, 2012 and 2011, respectively, which are recorded in payroll, related and food in our consolidated statements of operations.

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Note 14. Capital Lease Obligations

During 2011, we entered into an office lease for the combined headquarters of our subsidiaries, which extends through 2022. The lease was accounted for as capital leases under ASC-840: Leases .

As of December 31, 2013 and 2012, the capital lease asset was $7.3 million and $4.9 million, net of accumulated amortization of $1.5 million and $0.7 million, respectively, are included in property and equipment, net in the accompanying consolidated balance sheet. As of December 31, 2013 and 2012, the capital lease liability totaled $10.3 million and $7.3 million, respectively, including $7.8 million and $5.8 million, respectively, in other long-term liabilities in the accompanying consolidated balance sheet. Interest expense for the years ended December 31, 2013, 2012 and 2011 was $1.3 million, $0.8 million and $0.6 million, respectively. Amortization expense for the years ended December 31, 2013, 2012 and 2011 was $0.8 million, $0.4 million and $0.2 million, respectively, and is included in depreciation and amortization expense in the accompanying statements of income and comprehensive income.

The following schedule represents the future minimum lease payments under our capital lease obligation (in thousands) as of December 31, 2013.


For the twelve months ending December 31,
2014	$	1,799
2015		1,844
2016		1,891
2017		1,937
2018		1,986
Thereafter		8,268

Total minimum lease payments		17,725
Less: Amount representing interest(a)		(7,444	)

Present value of total minimum lease payments	$	10,281

(a)	Amount necessary to reduce total minimum lease payments to present value calculated at the Company’s incremental borrowing rate at lease inception.

Note 15. Commitments and Contingencies

Operating Leases

We have several non-cancelable operating leases, primarily for office space, that expire at various times through 2021. Rental expense for operating leases amounted to approximately $1.8 million, $1.6 million and $2.9 million for the years ended December 31, 2013, 2012 and 2011, respectively.

The following schedule represents our lease contractual obligations as of December 31, 2013:

(in thousands)


Years Ended December 31,
2014	$	1,081
2015		984
2016		499
2017		362
2018		370
Thereafter		1,164

Totals	$	4,460

F-37

Employment Agreements

We have entered into employee agreements with certain of our executive officers and key employees. These agreements provide for minimum salary levels, and in most cases, performance based bonuses that are payable if specified goals are attained. Some executive officers and key employees are also entitled to severance benefits upon termination or non-renewal of their contracts under certain circumstances. Additionally, if there is a change in control, some executive officers and key employees’ outstanding options will generally become fully vested and exercisable.

As of December 31, 2013, the approximate future minimum requirements under employment agreements, excluding discretionary and performance bonuses are as follows:

(in thousands)


Years Ended December 31,
2014	$	4,575
2015		2,225
2016		1,750

Totals	$	8,550

Equipment—Maintenance and Purchases

During March 2012, management signed a 5-year maintenance agreement with a vendor. The cost of future maintenance contract obligations under this agreement as of December 31, 2013 is approximately $17.2 million. The contract consists of multiple cost components. Monthly variable maintenance fees are based on engine usage over the contract term. Monthly fixed fees are based on a per vessel basis. We are also required to purchase a certain amount of capital equipment and spare parts. Equipment will be recorded as property and equipment upon receipt and maintenance fees are recorded as repair and maintenance expenses. As of December 31, 2013 and 2012 we incurred expenses of $8.4 million relating to this agreement, which is recorded in other ship operating expenses.

In October 2012, we entered into a software license agreement with a third party vendor. This agreement grants us a non-exclusive, perpetual, royalty-free license to use software. The total license fee is $2.3 million, of which $1.7 million was paid as of December 31, 2013. As of December 31, 2013, the future contract obligation relating to our third party software purchase is $0.6 million.

As of December 31, 2013, the approximate future minimum requirements under these agreements are as follows:

(in thousands)


Years Ended December 31,
2014	$	5,453
2015		5,637
2016		5,803
2017		967

Totals	$	17,860

Shipbuilding Contract

During 2013, we entered into a definitive contract with Italy’s Fincantieri shipyard to build a luxury cruise ship to be named the Seven Seas Explorer . Under the terms of contract, we will pay €325.9 million or

F-38

approximately $447.9 million (calculated based on the applicable exchange rate at December 31, 2013) to Fincantieri for the remaining balance of the new vessel. See “Note 5. Debt” in the accompanying notes to the financial statements.

(in thousands)


Years Ended December 31,
2014	$	23,573
2015		47,145
2016		377,163

Total	$	447,881

Litigation

On an ongoing basis, we assess the potential liabilities related to any lawsuits or claims brought against us. While it is typically very difficult to determine the timing and ultimate outcome of such actions, we use our judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss can be made. In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any. We accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated. The majority of claims are covered by insurance and we believe the outcome of such claims, net of estimated insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows.

Other

As mandated by the FMC for sailings from a U.S. port, the availability of passenger deposits received for future sailings is restricted until the completion of the related sailing in accordance with FMC regulations. We have met this obligation by posting two $15.0 million surety bonds. Our surety bond obligation will increase to $22.0 million in April 2014 and $30.0 million in April 2015.

One of our credit card service providers has a second mortgage on three of OCI’s ships, Regatta , Insignia and Nautica as collateral for credit card payments processed. The value of the mortgage is $48.7 million.

Note 16. Supplemental Cash Flow Information

For the years ended December 31, 2013, 2012 and 2011, we paid interest expense and related fees of $73.1 million, $59.5 million and $48.4 million, respectively. We also accrued related party interest of $32.5 million, $30.9 million and $29.4 million for the years ended 2013, 2012 and 2011, respectively, which was added to the outstanding balance of the related party notes payable.

For the year ended December 31, 2013, 2012 and 2011, we had non-cash investing activities related to the acquisition of property and equipment totaling $3.1 million, $4.4 million and $2.5 million, respectively. For the year ended December 31, 2013, 2012 and 2011 we had non-cash investing activities related to our capital leases totaling $3.2 million, $0.0 million and $5.7 million, respectively. For the year ended December 31, 2013, 2012 and 2011 we had non-cash investing activities related to the acquisition of intangible assets of $0.8 million, $2.0 million and $3.4 million, respectively.

For the year ended December 31, 2013, 2012 and 2011, we had non-cash financing activities relating to our capital lease of $0.5 million, $0.1 million and $7.5 million, respectively. For the year ended December 31, 2013, 2012 and 2011 we had non-cash financing activities related to deferred financing costs of $2.9 million, $0.6 million and $0.4 million, respectively.

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For the year ended December 31, 2013, 2012 and 2011, we recorded accretion related to the discounts on related party notes payable of $17.8 million, $15.3 million, and $13.0 million, respectively.

Note 17. Subsequent Events

In February 2014, OCI amended its existing $375.0 million first lien credit facility, consisting of both a $300.0 million term loan and a $75.0 million revolving credit facility. In conjunction with this amendment, the outstanding balance of the term loan under the original credit agreement of $299.3 million was repaid in full and as such that commitment was terminated. Concurrent with the repayment of the term loan, the Company entered into a commitment for a new term loan totaling $249.0 million. The interest rate on the new term loan is based on LIBOR, with a floor of 1.0%, plus a margin of 4.25% compared to a margin of 5.75% on the previously existing first lien term loan. The new term loan requires quarterly payments of principal equal to $0.6 million, beginning March 2014, with the remaining unpaid amount due and payable at maturity. Borrowings under the new term loan are prepayable in whole or in part at any time without penalty, but are subject to a prepayment premium in the event of a refinancing of the term loan within twelve months of the amendment date. There was no change to the terms of the $75.0 million revolving credit facility, the financial covenants or the maturity date of the credit facility. We are evaluating the appropriate accounting treatment for these transactions.

In February 2014, SSC amended its existing $340.0 million credit agreement, consisting of both a $300.0 million term loan and a $40.0 million revolving credit facility. In conjunction with this amendment, the outstanding balance on the term loan under the original credit agreement of $296.3 million was repaid in full and as such that commitment was terminated. Concurrent with the repayment of the term loan, the Company entered into a commitment for a new term loan totaling $246.0 million. The margin on the new term loan is 2.75% compared to 3.50% on the previously existing term loan and the LIBOR floor was reduced from 1.25% to 1%. There was no change to the terms of the $40.0 million revolving credit facility or the maturity date of the term loan. The new term loan requires quarterly payments of principal equal to $0.6 million beginning in March 2014, with the remaining unpaid amount due and payable at maturity. There was no change to the terms of the $40.0 million revolving credit facility, the financial covenants or the maturity date of the credit facility. We are evaluating the appropriate accounting treatment for these transactions.

Management evaluated subsequent events through March 24, 2014, the date the financial statements were available to be issued.

F-40

SCHEDULE I

Condensed Financial Information of Parent Company

BASIS OF PRESENTATION

The Parent Company follows the accounting policies as described in the consolidated financial statements of Prestige Cruises International, Inc. and subsidiaries (“PCI”) with the exception of its investment in its subsidiary for which the Parent Company uses the equity method of accounting. For further information, reference should be made to the notes to the audited consolidated financial statements of PCI.

Our operating companies credit agreements include various restrictions on the ability to make dividends and distributions to their parent entities and ultimately to us. The following are restricted net assets of our subsidiary at December 31, 2013 and December 31, 2012, respectively: $600.2 million and $458.6 million.

Condensed Balance Sheets

(in thousands, except par value)


	As of December 31,
	2013			2012
Assets
Cash and cash equivalents	$	28,471		$	28,391
Restricted Cash		30,000			—
Other current assets		518			—

Total current assets		58,989			28,391
Other assets		—			30,000
Investment in subsidiary		680,210			589,570

Total assets	$	739,199		$	647,961


Liabilities and Stockholders’ Equity (Deficit)
Long-term debt	$	711,617		$	661,304

Total liabilities		711,617			661,304
Stockholders’ equity (deficit)
Common stock, $0.01 par value		136			136
Additional paid-in capital		307,030			305,642
Accumulated deficit		(223,280	)		(258,802	)
Accumulated other comprehensive loss		(56,249	)		(60,319	)
Treasury shares at cost		(55	)		—

Total stockholders’ equity (deficit)		27,582			(13,343	)

Total liabilities and stockholders’ equity (deficit)	$	739,199		$	647,961

F-41

Condensed Statements of Operations and Comprehensive Income (Loss)

(in thousands, except per share data)


	For the Year Ended December 31,
	2013			2012			2011
Expenses
Selling and administrative	$	13		$	33		$	33

Total operating expenses		13			33			33

Non-operating income (expense)
Interest expense		(50,312	)		(46,161	)		(42,409	)
Interest income		131			116			229

Total non-operating expense		(50,181	)		(46,045	)		(42,180	)

Loss before equity in net income (loss) of subsidiary		(50,194	)		(46,078	)		(42,213	)
Equity in net income (loss) of subsidiary		85,716			43,466			(27,559	)

Net income (loss) and comprehensive income (loss )	$	35,522		$	(2,612	)	$	(69,772	)


Earnings (loss) per share:
Basic	$	2.62		$	(0.19	)	$	(5.14	)
Diluted	$	1.88		$	(0.19	)	$	(5.14	)

Weighted average number of share outstanding
Basic		13,571,828			13,571,827			13,564,766

Diluted		18,857,405			13,571,827			13,564,766

F-42

Condensed Statement of Cash Flows

(in thousands)


	Year Ended December 31,
	2013			2012			2011
Cash flows from operating activities
Net income (loss)	$	35,522		$	(2,612	)	$	(69,772	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of related party debt discount		17,840			15,253			12,990
Interest on related party notes		32,472			30,908			29,418
Equity in earnings of subsidiary		(85,716	)		(43,466	)		27,559

Net cash provided by operating activities		118			83			195


Cash flows from investing activities
Change in restricted cash		—			—			20,057

Net cash provided by investing activities		—			—			20,057


Cash flows from financing activities
Change in restricted cash—newbuild letter of credit		—			(15,000	)		(15,000	)
Proceeds from stock subscription		—			—			195
Issuance of common stock		17			7			164
Acquisition of treasury stock		(55	)		—			—

Net cash (used in) financing activities		(38	)		(14,993	)		(14,461	)

Net increase (decrease) in cash and cash equivalents	$	80		$	(14,910	)	$	5,611


Cash and cash equivalents
Beginning of period	$	28,391		$	43,301		$	37,690
End of period		28,471			28,391			43,301

Net increase (decrease) in cash and cash equivalents	$	80		$	(14,910	)	$	5,611


Non-cash Supplemental Cash Flow Information:

Investing activities
Increase (decrease) in investment in subsidiary	$	4,923		$	(910	)	$	37,243

F-43

SCHEDULE II

The following table represents Prestige Cruises International, Inc. valuation and qualifying account activity for the year-ended December 31, 2011, 2012 and 2013 (in thousands):


Description	Balance at beginning of period 1/1/2011			Charged to costs and expenses			Deductions		Balance at end of period 12/31/2011
Allowance for doubtful accounts	$	(77	)	$	—		$	48	$	(29	)
Reserve for obsolescence—spare parts		(449	)		(377	)		435		(391	)

	$	(526	)	$	(377	)	$	483	$	(420	)


Description	1/1/2012			Charged to costs and expenses			Deductions		12/31/2012
Allowance for doubtful accounts	$	(29	)	$	(320	)	$	160	$	(189	)
Reserve for obsolescence—spare parts		(391	)		(545	)		57		(879	)

	$	(420	)	$	(865	)	$	217	$	(1,068	)


Description	1/1/2013			Charged to costs and expenses			Deductions		12/31/2012
Allowance for doubtful accounts	$	(189	)	$	(738	)	$	285	$	(642	)
Reserve for obsolescence—spare parts		(879	)		(822	)		—		(1,701	)

	$	(1,068	)	$	(1,560	)	$	285	$	(2,343	)

F-44

Part II

Information Not Required in Prospectus

Item 13. Other Expenses of Issuance and Distribution.

The following sets forth the estimated expenses and costs (other than underwriting discounts and commissions) expected to be incurred in connection with the issuance and distribution of the common stock registered hereby:


SEC registration fee	$	32,200
FINRA filing fee		*
Exchange listing fees		*
Printing and engraving expenses		*
Accounting fees and expenses		*
Legal fees and expenses		*
Blue Sky fees and expenses		*
Transfer agent fees and expenses		*
Miscellaneous		*

Total	$	*

*	To be provided by amendment.

Item 14. Indemnification of Directors and Officers.

According to our Articles of Incorporation, to the fullest extent permitted by the applicable laws of the Republic of Panama, a director of our company shall not be personally liable to us or our subsidiaries for monetary damages or breach of a fiduciary duty as a director. We shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to an action or proceeding, whether criminal, civil, administrative, or investigative, by reason of the fact that he or she or his or her testator or intestate is or was a director of us or any of our subsidiaries, or serves or served at any other enterprise as director at our request, or acted at the direction of any such director against all expense, liability and loss actually and reasonably incurred or suffered by such person in connection therewith. We may enter into indemnity agreements with any director, officer, employee or agent of our company providing indemnification to the full extent permitted by the law and to purchase insurance for the benefit of the directors.

Item 15. Recent Sales of Unregistered Securities.

The following is a summary of our transactions since December 15, 2010 involving sales of our securities that were not registered under the Securities Act.

On January 31, 2013, we granted Mark S. Conroy, the former President of Regent, an option to purchase 100,000 shares of common stock under our 2008 Stock Option Plan at a price per share of the greater of $8.85 or Fair Market Value (as defined in the 2008 Stock Option Plan), in connection with his entry into a Separation Agreement and an Independent Contractor Agreement.

The sale and issuance of securities described in paragraph 1 above was made in reliance on Section 4(2) of the Securities Act in transactions by an issuer not involving a public offering where the purchasers were accredited investors within the meaning of Rule 501(a) under the Securities Act or were otherwise sophisticated, where the securities contained appropriate legends and transfer restrictions reflecting an intention not to purchase the securities with a view to any distribution, and where the purchasers received or had access to adequate information about us. The sale and issuance of securities described in paragraph 2 was made in reliance on Rule 701 promulgated under the Securities Act in that such securities were offered and sold pursuant to a written compensatory benefit plan.

II-1

Item 16. Exhibits

(a)

See the Exhibit Index immediately following the signature pages included in this Registration Statement.

(b)

Financial Statement Schedules:

Schedules for the years ended December 31, 2013, 2012 and 2011 are as follows:

Schedule I—Condensed Financial Information of Parent Company

Schedule II—Valuation and Qualifying Accounts

Item 17. Undertakings

The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 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 Securities and Exchange Commission such indemnification is against public policy as expressed in the 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 Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1)

For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(2)

For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus 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-2

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Miami, State of Florida, on March 24, 2014.


Prestige Cruises International, Inc.

By:		/s/ Jason M. Montague
		Name: Jason M. Montague Title: Chief Financial Officer

POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints Jason M. Montague his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments, to this Registration Statement, and any registration statement relating to the offering covered by this Registration Statement and filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes may lawfully so or cause to be done by virtue hereof.

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 following capacities on March 24, 2014.

/s/ Frank J. Del Rio

Frank J. Del Rio

Chief Executive Officer and

Chairman of the Board of Directors

(Principal Executive Officer)

/s/ Jason M. Montague

Jason M. Montague

Executive Vice President and Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

/s/ Adam M. Aron

Adam M. Aron

Director

/s/ Kevin E. Crowe

Kevin E. Crowe

Director

/s/ Russell W. Galbut

Russell W. Galbut

Director

/s/ Daniel M. Holtz

Daniel M. Holtz

Director

/s/ Steve Martinez

Steve Martinez

Director

/s/ Eric L. Press

Eric L. Press

Director

II-3

EXHIBIT INDEX


Exhibit Number		Description

1.1*		Form of Underwriting Agreement.

3.1*		Form of Amended and Restated Certificate of Incorporation of Prestige Cruises International, Inc.

3.2*		Form of Amended and Restated Bylaws of Prestige Cruises International, Inc.

4.1*		Form of Specimen Common Stock Certificate of Prestige Cruises, International, Inc.

5.1*		Legal Opinion of Arias, Fabrega & Fabrega.

10.1*		Amended and Restated Stockholders’ Agreement, dated May 18, 2009.

10.2**		2008 Stock Option Plan of Prestige Cruises International, Inc. (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Registration Statement on Form S-4/A filed March 1, 2012).

10.3**		Form Incentive Stock Option Agreement of Prestige Cruises International, Inc. (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Registration Statement on Form S-4/A filed March 1, 2012).

10.4**		Employment Agreement, dated March 22, 2013, between Prestige Cruises International, Inc. and Frank J. Del Rio (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Quarterly Report on Form 10-Q filed May 10, 2013).

10.5**		Employment Agreement, dated January 1, 2013, between Prestige Cruises Services, LLC and Jason M. Montague (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L,’s Annual Report on Form 10-K filed March 11, 2014).

10.6**		Employment Agreement, dated January 1, 2013, between Prestige Cruises Services, LLC and Robert J. Binder (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L,’s Annual Report on Form 10-K filed March 11, 2014).

10.7**		Employment Agreement, dated June 17, 2011, between Prestige Cruise Holdings, Inc., Oceania Cruises, Inc. and Kunal S. Kamlani (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Registration Statement on Form S-4/A filed March 1, 2012).

10.8*		Employment Agreement, dated January 1, 2012, between Prestige Cruises Services, LLC and T. Robin Lindsay.

10.9**		Credit Agreement, dated as of August 21, 2012, among Classic Cruises, LLC and Classic Cruises II, LLC, Seven Seas Cruises S. DE R.L. and SSC Finance Corp., as Borrowers, the lenders party thereto, Deutsche Bank AG, New York Branch, as Administrative Agent and as Collateral Agent, Barclays Bank PLC, as Syndication Agent, Crédit Agricole Corporate and Investment Bank, as Co-Manager, Deutsche Bank Securities Inc., Barclays Bank PLC, HSBC Securities (USA) Inc. and J.P. Morgan Securities, LLC, as Joint Bookrunners, and Deutsche Bank Securities Inc. and Barclays Bank PLC, as Co-Lead Arrangers (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Quarterly Report on Form 10-Q filed November 8, 2012).

10.10**		Amendment No. 1 to Credit Agreement, dated as of February 1, 2013, among Classic Cruises, LLC and Classic Cruises II, LLC, Seven Seas Cruises S. DE R.L. and SSC Finance Corp., as Borrowers and Deutsche Bank Securities AG, New York Branch, as the Administrative Agent, Collateral Agent and Term B-1 Lender to the Credit Agreement, dated as of August 21, 2012 (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Annual Report on Form 10-K filed March 8, 2013).


Exhibit Number		Description

10.11*		Credit Agreement, dated as of July 2, 2013, among Oceania Cruises, Inc. and OCI Finance Corp., as Borrowers, the lenders party thereto, Deutsche Bank AG, New York Branch, as Administrative Agent, Collateral Agent and as Mortgage Trustee, Barclays Bank plc and UBS Securities LLC, as Co-Syndication Agents, HSBC Securities (USA) Inc. and Crédit Agricole Corporate and Investment Bank, as Co-Documentation Agents, Deutsche Bank Securities Inc., Barclays Bank plc, UBS Securities LLC, HSBC Securities (USA) Inc. and Crédit Agricole Corporate and Investment Bank, as Joint Bookrunners, and Deutsche Bank Securities Inc., Barclays Bank plc and UBS Securities LLC, as Joint Lead Arrangers.

10.12**		Indenture, dated as of May 19, 2011, among Seven Seas Cruises S. DE R.L., as Issuer, Celtic Pacific (UK) Two Limited, Supplystill Limited, Regent Seven Seas Cruises UK Limited, Celtic Pacific (UK) Limited, SSC (France) LLC and Mariner, LLC, as Subsidiary Guarantors and Wilmington Trust FSB, as Trustee and Collateral Agent (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Registration Statement on Form S-4 filed November 30, 2011).

10.13†		Loan Agreement, dated July 18, 2008, among Marina New Build, LLC, as Borrower, the banks and financial institutions listed in Schedule 1 as Lenders, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent and SACE Agent.

10.14†		Loan Agreement, dated July 18, 2008, among Riviera New Build, LLC, as Borrower, the banks and financial institutions listed in Schedule 1 as Lenders, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent and SACE Agent.

10.15**†		Loan Agreement, dated July 31, 2013, among Explorer New Build, LLC, the banks and financial institutions listed in Schedule 1 as Lenders, Crédit Agricole Corporate and Investment Bank, Société Générale, HSBC Bank plc and KFW IPEX-Bank GmbH, as Joint Mandated Lead Arrangers and Crédit Agricole Corporate and Investment Bank, as Agent, SACE Agent and Security Trustee (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Quarterly Report on Form 10-Q filed November 8, 2013).

10.16**†		Shipbuilding Contract, dated June 5, 2013, between Fincantieri Cantieri Navali Italiani SpA and Explorer New Build, LLC (Incorporated by reference to the exhibit to Seven Seas Cruises S. DE R.L.’s Quarterly Report on Form 10-Q filed November 8, 2013).

10.17		Amended and Restated Regent Trademark License Agreement, dated February 21, 2011, by and between Regent Hospitality Worldwide, LLC and Seven Seas Cruises, S. DE R.L.

10.18		Guarantee relating to a Loan Agreement dated July 18, 2008 in respect of the Marina , dated July 18, 2008, dated July 18, 2008, among Oceania Cruises Inc., as Guarantor, the lenders party thereto, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent.

10.19		Guarantee relating to a Loan Agreement dated July 18, 2008 in respect of the Marina , dated July 18, 2008, among Prestige Cruise Holdings Inc., as Guarantor, the lenders party thereto, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent.

10.20		Guarantee relating to a Loan Agreement dated July 18, 2008 in respect of the Riviera , dated July 18, 2008, among Oceania Cruises Inc., as Guarantor, the lenders party thereto, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent.

10.21		Guarantee relating to a Loan Agreement dated July 18, 2008 in respect of the Riviera , dated July 18, 2008, among Prestige Cruise Holdings Inc., as Guarantor, the lenders party thereto, Calyon and Société Générale, as Mandated Lead Arrangers and Calyon, as Agent.

10.22		Guarantee relating to a Loan Agreement dated July 31, 2013 in respect of the Seven Seas Explorer , dated July 31, 2013, among Seven Seas Cruises S. DE R.L., as Guarantor, and Crédit Agricole Corporate and Investment Bank, as Security Trustee.


Exhibit Number		Description

10.23		Guarantee relating to a Loan Agreement dated July 31, 2013 in respect of the Seven Seas Explorer , dated July 31, 2013, among Prestige Cruise Holdings Inc., as Guarantor, and Crédit Agricole Corporate and Investment Bank, as Security Trustee.

10.24		2008 Form of Stock Options Agreement of Prestige Cruises International, Inc.

10.25		2008 Form of Stock Options Agreement of Prestige Cruises International, Inc.

10.26		2008 Form of Stock Options Agreement of Prestige Cruises International, Inc.

21.1		Subsidiaries of Prestige Cruises International, Inc.

23.1		Consent of PricewaterhouseCoopers LLP.

23.2*		Consent of Arias, Fabrega & Fabrega (included in Exhibit 5.1).

24.1		Power of Attorney (included on signature page herein).

*	To be filed by amendment

**	Incorporated by reference.

†	Confidential treatment has been requested for portions of this exhibit. These portions have been omitted from this Registration Statement and have been filed separately with the Securities and Exchange Commission.

Exhibit 10.13

[*] THE CONFIDENTIAL PORTION HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Date 18 July 2008

MARINA NEW BUILD, LLC

as Borrower

– and –

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

– and –

CALYON

SOCIÉTÉ GÉNÉRALÉ

as Mandated Lead Arrangers

– and –

CALYON

as Agent

and SACE Agent

LOAN AGREEMENT

relating to

the part financing of the passenger cruise ship newbuilding presently designated as

Hull No. 6194 at Fincantieri-Cantieri Navali Italiani S.p.A

Watson, Farley & Williams

Paris

INDEX


Clause		Page

1	INTERPRETATION		2
2	FACILITY		17
3	CONDITIONS PRECEDENT		18
4	DRAWDOWN		23
5	REPAYMENT		24
6	INTEREST		24
7	INTEREST PERIODS		26
8	CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS		26
9	SACE PREMIUM AND ITALIAN AUTHORITIES		27
10	FEES		28
11	TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES		28
12	REPRESENTATIONS AND WARRANTIES		30
13	UNDERTAKINGS		34
14	SECURITY VALUE MAINTENANCE		45
15	LETTER OF CREDIT PROVISIONS		46
16	CANCELLATION AND PREPAYMENT		47
17	INTEREST ON LATE PAYMENTS		48
18	EVENTS OF DEFAULT		49
19	APPLICATION OF SUMS RECEIVED		53
20	INDEMNITIES		53
21	ILLEGALITY, ETC		55
22	SET-OFF		55
23	CHANGES TO THE LENDERS		56
24	CHANGES TO THE OBLIGORS		58
25	ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS		58
26	CONDUCT OF BUSINESS BY THE CREDITOR PARTIES		62
27	SHARING AMONG THE CREDITOR PARTIES		63
28	PAYMENT MECHANICS		64
29	GOVERNING LAW		65
30	ENFORCEMENT		66
31	SCHEDULES		66
32	NOTICES		66
33	SUPPLEMENTAL		67
SCHEDULE 1 LENDERS AND COMMITMENTS			69
SCHEDULE 2 FORM OF DRAWDOWN NOTICE			70
SCHEDULE 3 DOCUMENTS TO BE PRODUCED BY THE BUILDER TO THE AGENT ON DELIVERY			71
EXECUTION PAGES			72
EXHIBIT A FORM OF LETTER OF CREDIT			74

LOAN AGREEMENT

THIS AGREEMENT is made on 18 July 2008

BETWEEN

(1)	MARINA NEW BUILD, LLC , a limited liability company formed in the Marshall Islands whose registered office is at c/o The Trust Company of the Marshall Islands Inc., Trust Company Complex, Ajeltake Island, Ajeltake Road, Majuro MH 96960, Republic of the Marshall Islands (the “ Borrower ”);

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1, as Lenders ;

(3)	CALYON and SOCIÉTÉ GÉNÉRALE as Mandated Lead Arrangers ; and

(4)	CALYON , as Agent and SACE Agent .

BACKGROUND

(A)

By a Master (Shipbuilding Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri - Cantieri Navali Italiani SpA, a company incorporated in Italy with registered office in Trieste, via Genova, 1, and having fiscal code 00397130584 (the “ Builder ”), Prestige Cruise Holdings Inc., Oceania Cruises Inc. and, by way of endorsement, the Borrower providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6194 as more particularly described in the Shipbuilding Contract (the “ Ship ”) to be delivered on 30 September 2010 subject to any adjustments of such delivery date in accordance with the Shipbuilding Contract.

(B)	The total price payable by the Borrower to the Builder under the Shipbuilding Contract is EUR 409,095,000.00 (the “ Initial Contract Price ”) payable on the following terms:

(i)

as to [*]%, by an initial payment which was made on the date when the Original Shipbuilding Contract entered into full effect pursuant to Article 33 of the Original Shipbuilding Contract and, as to the balance, upon signature of the Master Agreement;

(ii)

as to [*]% on the later of the start of steel cutting and 30 October 2008;

(iii)

as to [*]% on the later of keel laying and 1 April 2009;

(iv)

as to [*]% on the later of float out and 26 February 2010; and

(v)

as to [*]% on delivery of the Ship.

(C)

The Initial Contract Price may be (i) increased or decreased from time to time under Article 24 of the Shipbuilding Contract in the event that the Borrower requests, and the Builder agrees, modifications to the specification or plans constituting a part of the Shipbuilding Contract or in the event that, subsequent to the date of the Shipbuilding Contract, variations are made to its provisions compliance with which is compulsory, the net cost of all such variations being payable on the Delivery Date (the “ Change Orders ”); and (ii) decreased at delivery of the Ship under Articles 13, 14, 16 and 17 of the Shipbuilding Contract (in aggregate the “ Liquidated Damages ”) or by mutual agreement between the parties (the Initial Contract Price adjusted as aforesaid being the “ Final Contract Price ”).

(D)

The Lenders have agreed to make available to the Borrower a Dollar loan facility for the purpose for the purpose of assisting the Borrower in financing, subject to exchange rate fluctuations, up to 80% of the Final Contract Price and 100% of the instalment of the relevant SACE Premium which is payable on the Drawdown Date.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Definitions . Subject to Clause 1.5, in this Agreement:

“ Affiliate ” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “ control ” (including, with correlative meanings, the terms “ controlling ”, “ controlled by ” and “ under common control with ”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent. (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract or otherwise;

“ Affected Lender ” has the meaning given in Clause 6.5;

“ Agent ” means Calyon, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9 Quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre or any successor of it appointed under Clause 24;

“ Annex VI ” means Annex VI (Regulations for the Prevention of Air Pollution from Ships) to the International Convention for the Prevention of Pollution from Ships 1973 (as modified in 1978 and 1997);

“ Approved Flag ” means the Marshall Islands flag or such other flag as the Agent may, with the authorisation of the Majority Lenders, approve from time to time;

“ Approved Manager ” means the Borrower or any other company (whether or not a member of the Group) which the Agent may, with the authorisation of the Majority Lenders, approve from time to time as the manager of the Ship;

“ Approved Manager’s Undertaking ” means, in the event that the Approved Manager is a company other than the Borrower, a letter of undertaking executed or to be executed by the Approved Manager in favour of the Agent, which will include, without limitation, an agreement by the Approved Manager to subordinate its rights against the Ship and the Borrower to the rights of the Creditor Parties under the Finance Documents, in the agreed form;

“ Availability Period ” means the period commencing on the date of this Agreement and ending on:

(a)

the earlier to occur of (i) the Delivery Date and (ii) the date falling 360 days (being the period stipulated in Article 8.6 of the Shipbuilding Contract) after 30 September 2010 (or such later date as the Agent may, with the authorisation of the Lenders, agree with the Borrower); or

(b)

if earlier, the date on which the Total Commitments are fully borrowed, cancelled or terminated;

“ Base Rate ” means one Euro for [*] Dollars;

“ Builder ” has the meaning given in Recital (A);

“ Builder Letter of Credit ” means a letter of credit relating solely to the Shipbuilding Contract issued in favour of the Builder by the Letter of Credit Issuer in the form of Exhibit B or another agreed form;

“ Business Day ” means a day on which banks are open in London and Paris and, in relation to any payment to be made to the Builder, Milan and, in respect of a day on which a payment is required to be made under a Finance Document, also in New York City;

“ Certified Copy ” means in relation to any document delivered or issued by or on behalf of any company, a copy of such document certified as a true, complete and up-to-date copy of the original by any of the directors or the secretary or assistant secretary or any attorney-in-fact for the time being of that company;

“ CIRR ” (Commercial Interest Reference Rate) means 5.62% per annum or any other lower CIRR rate being the fixed rate for medium and long term export credits in Dollars applicable to the financing of the Ship according to the Organisation for Economic Co-operation and Development rules as determined by the competent Italian Authorities;

“ Commitment ” means, in relation to a Lender, the percentage of the Maximum Loan Amount set opposite its name in Schedule 1, or, as the case may require, the amount specified in the relevant Transfer Certificate, as that amount may be reduced, cancelled or terminated in accordance with this Agreement (and “ Total Commitments ” means the aggregate of the Commitments of all the Lenders);

“ Compliance Certificates ” means the Prestige Holdings Compliance Certificate and the Oceania Cruises Compliance Certificate and, in the singular, either of them;

“ Contribution ” means, in relation to a Lender, the part of the Loan which is owing to that Lender;

“ Conversion Rate ” means the rate determined by the Agent on the Conversion Rate Fixing Date and notified to the Borrower as being:

(a)

the Base Rate; or

(b)

in the event that the FOREX Contracts Weighted Average Rate is lower than the Base Rate (i.e. such that a lower amount in Dollars is necessary to purchase Euro than is reflected by the Base Rate), the FOREX Contracts Weighted Average Rate; or

(c)

in the event that the FOREX Contracts Weighted Average Rate is higher than the Base Rate (i.e. such that a greater amount in Dollars is necessary to purchase Euro than is reflected by the Base Rate), the lower of:

(i)

the FOREX Contracts Weighted Average Rate; and

(ii)

the Base Rate increased by 10% (ten per cent.);

“ Conversion Rate Fixing Date ” means the date falling [*] ([*]) days before the Intended Delivery Date;

“ Creditor Party ” means the Agent, the SACE Agent, the Mandated Lead Arrangers or any Lender, whether as at the date of this Agreement or at any later time;

“ Delivery Date ” means the date and time of delivery of the Ship by the Builder to the Borrower as stated in the Protocol of Delivery and Acceptance;

“ Dollar Equivalent ” means such amount in Dollars as is calculated by the Agent on the Conversion Rate Fixing Date to be the equivalent of an amount in Euro at the Conversion Rate;

“ Dollars ” and “ $ ” means the lawful currency for the time being of the United States of America;

“ Drawdown Date ” means the date on which the Loan is drawn down and applied in accordance with Clause 2;

“ Drawdown Notice ” means a notice in the form set out in Schedule 2 (or in any other form which the Agent approves or reasonably requires);

“ Earnings ” means all moneys whatsoever which are now, or later become, payable (actually or contingently) to the Borrower and which arise out of the use or operation of the Ship, including (but not limited to):

(a)

all freight, hire, fare and passage moneys, compensation payable to the Borrower or the Agent in the event of requisition of the Ship for hire, remuneration for salvage and towage services, demurrage and detention moneys and damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of the Ship;

(b)

all moneys which are at any time payable under Insurances in respect of loss of earnings; and

(c)

if and whenever the Ship is employed on terms whereby any moneys falling within paragraphs (a) or (b) above are pooled or shared with any other person, that proportion of the net receipts of the relevant pooling or sharing arrangement which is attributable to the Ship;

“ Eligible Amount ” means 80% of the lesser of:

(a)

the Dollar Equivalent of EUR 418,237,911; and

(b)

the Dollar Equivalent of the Final Contract Price

in each case less any Letter of Credit Reduction;

“ Euro ” and “ EUR ” means the single currency of the Participating Member States;

“ Event of Default ” means any of the events or circumstances described in Clause 18.1;

“ Existing Indebtedness ” means Financial Indebtedness of any member of the Group existing at the date of this Agreement under any of the “Transaction Documents” (or funded subsequently pursuant to any revolving or incremental facility set forth therein at the date hereof) as such term is defined in the $340,000,000 Credit Agreement dated 27 April 2007 between Oceania Cruises as guarantor, Insignia Vessel Acquisition LLC, Regatta Acquisition LLC and Nautica Acquisition LLC as borrowers, Lehman Commercial Paper Inc. as agent and the lenders party thereto, as the same may from time to time be amended, varied, supplemented and/or novated;

“ External Management Agreement ” means, in the event that the Approved Manager is not a member of the Group, the management agreement entered or to be entered into between the Borrower and the Approved Manager with respect to the Ship;

“ External Management Agreement Assignment ” means an assignment of the rights of the Borrower under the External Management Agreement (if any) executed or to be executed by the Borrower in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ 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 five (5) Business Days’ written notice) of the office or offices through which it will perform its obligations under this Agreement;

“ Finance Documents ” means:

(a)

this Agreement;

(b)

the Guarantees;

(c)

the General Assignment;

(d)

the Letter of Credit;

(e)

any External Management Agreement Assignment;

(f)

the Mortgage;

(g)

the Post-Delivery Assignment;

(h)

the Limited Liability Company Interests Security Deed;

(i)

any Time Charter Assignment;

(j)

the Approved Manager’s Undertaking; and

(k)

any other document (whether creating a Security Interest or not) which is designated as a Finance Document by agreement between the Borrower and the Agent or which is executed at any time by the 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 under this Agreement or any of the other documents referred to in this definition;

“ Final Contract Price ” has the meaning given in Recital (C),

“ 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 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

(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;

“ Fixed Interest Rate ” means CIRR;

“ Floating Interest Rate ” means, in respect of any Interest Period, the rate per annum determined by the Agent to be the aggregate of:

(a)

the Margin; and

(b)

LIBOR for the relevant period.

“ FOREX Contracts ” means each actual purchase contract, spot or forward contract and any other contract, such as an option or collar arrangement, which is entered into in the foreign exchange markets for the acquisition of Euro intended to pay the delivery instalment under the Shipbuilding Contract, which:-

(i)

matures not later than the Intended Delivery Date, provided that option arrangements may mature up to one month after such date if at the time they are entered into there exists a reasonable uncertainty as to the date on which the Ship will be delivered;

(ii)

is entered into by the Borrower or either Guarantor or a combination of the foregoing not later than two (2) days before the Conversion Rate Fixing Date so that the Borrower, directly or through a Guarantor, purchases or may purchase Euro with Dollars at a pre-agreed rate; and

(iii)

is notified to the Agent within ten (10) days of its execution but in any event no later than the day preceding the Conversion Rate Fixing Date, with a Certified Copy of each such contract being delivered to the Agent at such time;

“ FOREX Contracts Weighted Average Rate ” means the rate determined by the Agent at around 12 noon (Paris time) on the Conversion Rate Fixing Date in accordance with the following principles which (inter alia) are intended to take into account any maturity mismatch between the maturity of the FOREX Contracts and the Intended Delivery Date as well as FOREX Contracts that are unwound as part of the hedging strategy of the Borrower:

(i)

FOREX Contracts that are spot or forward foreign exchange contracts, if any, shall be valued at the contract value (taking into account any rescheduling);

(ii)

the difference between the Euro amount available under (i) above and the Euro amount balance payable to the Builder on the Delivery Date is assumed to be purchased at the official daily fixing rate of the European Central Bank for the purchase of Euro with Dollars as displayed on “Reuters Page ECB 37” at or around 2 p.m. (Paris time) on the Conversion Rate Fixing Date;

(iii)

any FOREX Contract which is an option or collar arrangement and is not unwound at the Conversion Rate Fixing Date will be marked to market and the resulting profit or loss shall reduce or increase the Dollar countervalue of the purchased Euro;

(iv)

any FOREX Contract which is an option or collar arrangement and is sold or purchased back at the time FOREX Contract(s) are entered into for an identical Euro amount shall be accounted for the net premium cost or profit, as the case may be.

Any marked to market valuation, as required in (iii), shall be performed by Calyon’s dedicated desk in accordance with market practices. The Borrower shall have the right to request indicative valuations from time to time prior to the Conversion Rate Fixing Date.

“ GAAP ” means generally accepted accounting principles in the United States of America consistently applied (or, if not consistently applied, accompanied by details of the inconsistencies) including, without limitation, those set forth in the opinion and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board;

“ General Assignment ” means a general assignment of the Earnings, the Insurances and any Requisition Compensation, executed or to be executed by the Borrower and, in the event that the Approved Manager is not a member of the Group and is named as a co-assured in the Insurances, the Approved Manager in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Group ” means Prestige Holdings and its subsidiaries;

“ Guarantees ” means the Oceania Cruises Guarantee and the Prestige Holdings Guarantee;

“ Guarantors ” means Oceania Cruises and Prestige Holdings;

“ IAPPC ” means a valid international air pollution prevention certificate for the Ship issued under Annex VI;

“ Initial Contract Price ” has the meaning given in Recital (B);

“ Insurances ” means:

(a)

all policies and contracts of insurance, including entries of the Ship in any protection and indemnity or war risks association, which are effected in respect of the Ship, 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;

“ Intended Delivery Date ” means 30 September 2010 (the date on which the Ship will be ready for delivery pursuant to the Shipbuilding Contract as at the date of this Agreement) or any other date notified by the Borrower to the Agent in accordance with Clauses 3.5(a) or 3.7(c) as being the date on which the Builder and the Borrower have agreed that the Ship will be ready for delivery pursuant to the Shipbuilding Contract;

“ Interest Make-up Agreement ” means an agreement to be entered into between SIMEST and the Agent on behalf of the Lenders, in form and substance acceptable to the Mandated Lead Arrangers, whereby, inter alia, the return to the Lenders on the Loan made hereunder will be supplemented by SIMEST so that it equals that which the Lenders would have received if interest were payable on the Loan at LIBOR plus the Margin;

“ Interest Period ” means a period determined in accordance with Clause 7;

“ ISM Code ” means the International Safety Management Code (including the guidelines on its implementation), adopted by the International Maritime Organisation Assembly as Resolutions A.741 (18) and A.788 (19), 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 adopted by the International Maritime Organisation;

“ Italian Authorities ” means SACE and/or SIMEST and any other relevant Italian authorities involved in the implementation of the Loan;

“ Lender ” means a bank or financial institution listed in Schedule 1 and acting through its Facility Office or its transferee, successor or assign;

“ Letter of Credit ” means a letter of credit (if any) issued or to be issued in accordance with Clause 15.1 by the Letter of Credit Issuer in favour of the Agent in the form of Exhibit A or another agreed form;

“ Letter of Credit Amount ” means either:

(a)

the face amount of the Letter of Credit (if any) issued on or prior to the Letter of Credit Issue Date in accordance with Clause 15.1; or

(b)

if no Letter of Credit has been issued in accordance with Clause 15.1, zero;

“ Letter of Credit Event of Default ” means, in the event that the Borrower has procured the delivery to the Agent by the Letter of Credit Issuer of the Letter of Credit in accordance with the provisions of Clause 15.1:

(a)

the Letter of Credit ceasing or failing to be in full force and effect in accordance with its terms for any reason whatsoever other than by virtue of Clause 15.4; or

(b)

any event or circumstance referred to in Clauses 18.7 to 18.12 (inclusive) occurring or existing, mutatis mutandis, in relation to the Letter of Credit Issuer;

“ Letter of Credit Issue Date ” means the date falling fifteen (15) Business Days prior to the Intended Delivery Date;

“ Letter of Credit Issuer ” means Lehman Brothers Bank, Federal Savings Bank, a company incorporated in Delaware or any other financial institution acceptable to the Agent;

“ Letter of Credit Reduction ” means USD50,000,000 less the aggregate of:

(a)

the Letter of Credit Amount; and

(b)

the cumulative amount of all drawings in respect of the Builder Letter of Credit on or prior to the earlier of:

(i)

the date of issue of the Letter of Credit (if any); and

(ii)

the Letter of Credit Issue Date;

“ Letter of Credit Release Event ” has the meaning given in Clause 15.4;

“ LIBOR ” means, in relation to a particular period, the rate determined by the Agent to be that at which deposits of Dollars in amounts comparable with the amount for which LIBOR is to be determined and for a period equivalent to such period are being offered in the London interbank eurocurrency market at or about 11 a.m. (London time) on the Quotation Date for such period as displayed on the “Reuters Page LIBOR 01” on Reuter Monitor Money Rates Service (or such other page as may replace such “Reuters Page LIBOR 01” on such system or on any other system of the information vendor for the time being designated by the British Bankers’ Association to calculate the BBA Interest Settlement Rate (as defined in the British Bankers’ Association’s Recommended Terms and Conditions (“ BBAIRS Terms ”) dated August, 1985)), Provided that if on such date no such rate is so displayed, LIBOR for such period shall be the rate quoted to the Agent by the Lenders at the request of the Agent as the Lenders’ offered rate for deposits of Dollars in an amount approximately equal to the amount in relation to which LIBOR is to be determined for a period equivalent to such period to prime banks in the London interbank eurocurrency market at or about 11 a.m. (London time) on the Quotation Date for such period;

“ Limited Liability Company Interests Security Deed ” means a security pledge in relation to the limited liability company interests of the Borrower executed or to be executed by Oceania Cruises in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Loan ” means the principal amount for the time being outstanding under this Agreement;

“ Majority Lenders ” means:

(a)

before the Loan has been made, Lenders whose Commitments total [*] per cent. of the Total Commitments; and

(b)

after the Loan has been made, Lenders whose Contributions total [*] per cent. of the Loan;

“ Margin ” means zero point fifty five per cent. (0.55%) per annum;

“ Maritime Registry ” means the maritime registry which the Borrower will specify to the Lenders no later than three (3) months before the Intended Delivery Date, being that of the Marshall Islands or such other registry as the Agent may, with the authorisation of the Majority Lenders, approve;

“ Maximum Loan Amount ” means the aggregate of:

(a)

the Dollar Equivalent of Euro [*]; and

(b)

[*]% of the second instalment of the SACE Premium payable on the Drawdown Date,

“ Mortgage ” means the first priority mortgage on the Ship acceptable for registration on the Approved Flag and, if applicable, deed of covenant, executed or to be executed by the Borrower in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Negotiation Period ” has the meaning given in Clause 6.8;

“ Obligors ” means the Borrower, the Guarantors and (in the event that the Approved Manager is a member of the Group) the Approved Manager;

“ Oceania Cruises ” means Oceania Cruises Inc., a Panamanian sociedad anonima domiciled in Panama whose resident agent is Marcela Rojas de Perez at 10 Elvira Mendez Street, Top Floor, Panama, Republic of Panama;

“ Oceania Cruises Compliance Certificate ” has the meaning given to “Compliance Certificate” in the Oceania Cruises Guarantee;

“ Oceania Cruises Guarantee ” means a guarantee issued or to be issued as provided in Clause 3.2 by Oceania Cruises in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Other Loan Agreement ” means the loan agreement dated on or about the date of this Agreement between Riviera New Build, LLC and the parties to this Agreement (other than the Borrower);

“ Other Ship ” means the passenger cruise ship defined as the “Ship” in the Other Loan Agreement;

“ Overnight LIBOR ” means, on any date, the London interbank offered rate, being the day to day rate at which Dollars are offered to prime banks in the London interbank market and published by the British Bankers’ Association at or about 11.00 a.m. London time on page LIBOR01 of the Reuters screen. If the agreed page is replaced or the service ceases to be available, the Agent may specify another page or service displaying the appropriate rate after consultation with the Borrower;

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

“ Party ” means a party to this Agreement from time to time;

“ Permitted Security Interests ” means:

(A)

in the case of the Borrower,

(i)

any of the Security Interests referred to in paragraph (a) below, and

(ii)

any of the Security Interests referred to in paragraphs (b), (c), (e), (h) and (i) below if, by reason of any chartering or management arrangements for the Ship approved by the Agent pursuant to the provisions of this Agreement, such Security Interests are created by the Borrower in the case of paragraphs (b), (c) or (e) or incurred by the Borrower in the case of paragraphs (h) or (i); and

(B)

in the case of a Guarantor,

(i)

any of the Security Interests referred to in paragraphs (a), (d), (f) and (g) below, and

(ii)

any of the Security Interests referred to in paragraphs (c), (e), (h) and (i) below if, by reason of any chartering or management arrangements for the Ship approved by the Agent pursuant to the provisions of this Agreement, such Security Interests are created by either Guarantor in the case of paragraphs (c) or (e) or incurred by either Guarantor in the case of paragraphs (h) or (i);

(a)

any Security Interest created by or pursuant to the Finance Documents and any deposits or other Security Interests placed or incurred in connection with any

bond or other surety from time to time provided to the US Federal Maritime Commission in order to comply with laws, regulations and rules applicable to the operators of passenger vessels operating to or from ports in the United States of America;

(b)

liens on the Ship up to an aggregate amount at any time not exceeding [*] Dollars ($[*]) for current crew’s wages and salvage and liens incurred in the ordinary course of trading the Ship;

(c)

any deposits or pledges up to an aggregate amount at any time not exceeding [*] Dollars ($[*]) to secure the performance of bids, tenders, bonds or contracts required in the ordinary course of business;

(d)

any other Security Interest including in relation to the Existing Indebtedness over the assets of any Obligor other than the Borrower notified by the Borrower or any of the Obligors to the Agent prior to the date of this Agreement;

(e)

(without prejudice to the provisions of Clause 13.11) liens on assets leased, acquired or upgraded after the date hereof or assets newly constructed or converted after the date hereof provided that (i) such liens secure Financial Indebtedness otherwise permitted under this Agreement, (ii) such liens are incurred at the time of such lease, acquisition, upgrade, construction or conversion and (iii) the Financial Indebtedness secured by such liens does not exceed the cost of such upgrade or the cost of such assets acquired or leased;

(f)

other liens arising in the ordinary course of business of the Group unrelated to Financial Indebtedness and securing obligations not yet delinquent or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established provided that (i) the aggregate amount of all cash and the fair market value of all other property subject to such liens as are described in this paragraph (f) above does not exceed [*] Dollars ($[*]) and (ii) such cash and/or other property is not an asset of the Borrower;

(g)

subject to the other provisions of this Agreement and the Guarantee, any Security Interest in respect of existing Financial Indebtedness of a person which becomes a subsidiary of either Guarantor or is merged with or into either Guarantor or any of their subsidiaries;

(h)

liens in favour of credit card companies on unearned customer deposits pursuant to agreements therewith;

(i)

liens in favour of customers on unearned customer deposits

“ Pertinent Document ” means

(a)

any Finance Document;

(b)

any policy or contract of insurance contemplated by or referred to in Clause 13 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 the Agent in contemplation of or in connection with any Finance Document or any policy, contract or document falling within 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;

“ Post-Delivery Assignment ” means an assignment of the rights of the Borrower in respect of the post-delivery guarantee liability of the Builder under Article 25 of the Shipbuilding Contract executed or to be executed by the Borrower in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Prestige Holdings ” means Prestige Cruise Holdings Inc. a Panamanian sociedad anonima domiciled in Panama whose resident agent is Arias, Fabrega & Fabrega at Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama;

“ Prestige Holdings Compliance Certificate ” has the meaning given to “Compliance Certificate” in the Prestige Holdings Guarantee;

“ Prestige Holdings Guarantee ” means a guarantee issued or to be issued as provided in Clause 3.2 by Prestige Holdings in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Protocol of Delivery and Acceptance ” means the protocol of delivery and acceptance of the Ship to be signed by the Borrower and the Builder in accordance with Article 8 of the Shipbuilding Contract;

“ 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), 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;

“ Repayment Date ” means a date on which a repayment is required to be made under Clause 5;

“ 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”;

“ SACE ” means Servizi Assicurativi del Commercio Estero - SACE SpA;

“ SACE Agent ” means Calyon, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, Quai du Président Paul Doumer, 92920 Paris La Défense Defense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre or any successor of it appointed under Clause 25;

“ SACE Insurance Policy ” means the insurance policy in respect of this Agreement to be issued by SACE for the benefit of the Lenders, in form and substance satisfactory to the Agent;

“ SACE Premium ” means the amount payable by the Borrower to SACE through the Agent in two instalments in respect of the SACE Insurance Policy as set out in Clause 9;

“ Secured Liabilities ” means all liabilities which the Borrower, the Obligors 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 any judgment relating to any Finance Document; 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 Period ” means the period commencing on the date of this Agreement and ending on the date on which:

(a)

all amounts which have become due for payment by the Borrower or any Obligor under the Finance Documents have been paid;

(b)

no amount is owing or has accrued (without yet having become due for payment) under any Finance Document;

(c)

neither the Borrower nor any other Obligor has any future or contingent liability under Clause 19 below or any other provision of this Agreement or another Finance Document; and

(d)

the Agent and the Majority Lenders do not consider that there is a significant risk that any payment or transaction under a Finance Document would be set aside, or would have to be reversed or adjusted, in any present or possible future bankruptcy of the Borrower or an Obligor or in any present or possible future proceeding relating to a Finance Document or any asset covered (or previously covered) by a Security Interest created by a Finance Document;

“ Security Requirement ” means the amount in Dollars (as certified by the Agent whose certificate shall, in the absence of manifest error, be conclusive and binding on the Borrower and the Agent) which is at any relevant time one hundred per cent (100%) of the Loan;

“ Security Value ” means the amount in Dollars (as certified by the Agent whose certificate shall, in the absence of manifest error, be conclusive and binding on the Borrower and the Agent) which, at any relevant tune, is the aggregate of (i) the market value of the Ship as most recently determined in accordance with Clause 13.18; and (ii) the market value of any additional security for the time being actually provided to the Agent pursuant to Clause 14;

“ Ship ” means the passenger cruise ship currently designated with Hull No. 6194 (as more particularly described in the Shipbuilding Contract) to be constructed under the Shipbuilding Contract and to be delivered to, and purchased by, the Borrower and registered in its name under an Approved Flag with the name “MARINA”;

“ Shipbuilding Contract ” has the meaning given in Recital (A);

“ SIMEST ” means Societá Italiana per Le Imprese all’Estero - SIMEST Spa, which grants export subsidies in Italy under and according to the Italian Legislative Decree n. 143/98 and its amendments;

“ Taxes ” means all present and future income and other taxes, levies, imposts, deductions, compulsory liens and withholdings whatsoever together with interest thereon and penalties with respect thereto, if any, and any payments made on or in respect thereof and “ Taxation ” shall be construed accordingly;

“ Time Charter Assignment ” means a deed creating security in respect of a time or consecutive voyage charter in respect of the Ship (including any guarantee in respect of the obligations of the charterer under the charter) executed or to be executed by the Borrower in favour of the Agent, the SACE Agent and the Lenders in the agreed form pursuant to Clause 13.12;

“ Total Loss ” means:

(a)

actual, constructive, compromised, agreed or arranged total loss of the Ship;

(b)

any expropriation, confiscation, requisition or acquisition of the Ship, whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected by any government or official authority or by any person or persons claiming to be or to represent a government or official authority, (excluding a requisition for hire for a fixed period not exceeding 1 year without any right to an extension) unless it is within 1 month redelivered to the Borrower’s full control;

(c)

any arrest, capture, seizure or detention of the Ship (including any hijacking or theft) unless it is within 1 month redelivered to the Borrower’s full control;

“ Total Loss Date ” means:

(a)

in the case of an actual loss of the Ship, the date on which it occurred or, if that is unknown, the date when the Ship was last heard of;

(b)

in the case of a constructive, compromised, agreed or arranged total loss of the Ship, 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 with the Ship’s insurers in which the insurers agree to treat the Ship 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 acting reasonably and in consultation with the Borrower that the event constituting the total loss occurred;

“ Transaction Documents ” means the Finance Documents and the Underlying Documents;

“ Underlying Documents ” means the Shipbuilding Contract, any External Management Agreement and any charter and associated guarantee in respect of which a Time Charter Assignment is, or by the terms of this Agreement is required to be, executed;

1.2

Construction of certain terms . In this Agreement:

“ approved ” means, for the purposes of Clause 13.20, approved in writing by the Agent;

“ asset ” includes every kind of property, asset, interest or right, including any current, 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, license, exemption, filing, registration, notarisation and legalization;

“ 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, fax or telex;

“ excess risks ” means the proportion of claims for general average, salvage and salvage charges not recoverable under the hull and machinery policies in respect of the Ship in consequence of its insured value being less than the value at which the Ship 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 of its Security Council;

“ 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;

“ obligatory insurances ” means all insurances effected, or which the Borrower is obliged to effect, under Clause 13.20 or any other provision of this Agreement or another Finance Document;

“ parent company ” has the meaning given in Clause 1.4;

“ person ” includes any company; any state, political sub-division of a state and local or municipal authority; and any international organization;

“ 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 1 of the Institute Time Clauses (Hulls) (l/10/83) or Clause 8 of the Institute Time Clauses (Hulls) (1/11/1995) 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;

“ 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; and

“ war risks ” includes the risk of mines and all risks excluded by Clause 23 of the Institute Time Clauses (Hulls) (l/10/83) or Clause 24 of the Institute Time Clauses (Hulls) (1/11/1995).

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

(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 in Clause 1.1 to a Finance Document or any other document being an “ agreed form ” are to the form agreed between the Agent (acting with the authorisation of each of the Creditor Parties) and the Borrower with any modifications to that form which the Agent (with the authorisation of the Majority Lenders in the case of substantial modifications) approves or reasonably requires;

(b)	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;

(c)	references to, or to a provision of, any law include any amendment, extension, reenactment or replacement, whether made before the date of this Agreement or otherwise;

(d)	words denoting the singular number shall include the plural and vice versa; and

(e)	Clauses 1.1 to 1.5 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 agree to make available to the Borrower a loan not exceeding the Maximum Loan Amount intended to be applied as follows:

(a)	in payment to the Builder of all or part of 80% of the Final Contract Price up to the Eligible Amount; and

(b)	in reimbursement to the Agent on behalf of the Lenders of the amount of the second instalment of the SACE Premium payable by it to SACE on the Drawdown Date.

2.2

Lenders’ participations in Loan . Subject to the other provisions of this Agreement, each Lender shall participate in the Loan in the proportion which, as at the Drawdown Date, its Commitment bears to the Total Commitments.

2.3

Purpose of Loan . The Borrower undertakes with each Creditor Party to use the Loan only to pay for:

(a)	goods and services of Italian origin incorporated in the design, construction or delivery of the Ship;

(b)

subject to the limits and conditions fixed by the Italian Authorities, goods and services incorporated in the design, construction or delivery of the Ship and originating from countries other than Italy where the provision of such goods or services has been subcontracted by the Builder and therefore remains the Builder’s responsibility under the Shipbuilding Contract; and

(c)	the second instalment of the SACE Premium payable on the Drawdown Date.

2.4

Proceedings by individual Lender requiring Majority Lender consent . Except for the SACE Agent, no Lender may commence proceedings against the Borrower or any other Obligor in connection with a Finance Document without the prior consent of all the Lenders.

2.5

Obligations of Lenders several . The obligations of the Lenders under this Agreement are several; and a failure of a Lender to perform its obligations under this Agreement shall not result in:

(a)	the obligations of the other Lenders being increased; nor

(b)	any Obligor or any other Lender being discharged (in whole or in part) from its obligations under any Finance Document;

and in no circumstances shall a Lender have any responsibility for a failure of another Lender to perform its obligations under this Agreement.

3	CONDITIONS PRECEDENT

3.1

General . The Borrower may only draw under the Loan when the following conditions have been fulfilled to the satisfaction of the Agent and provided no Event of Default shall have occurred and remains unremedied or is likely to occur as a consequence of the drawing of the Loan:

3.2

No later than the date of this Agreement . The Agent shall have received no later than the date of this Agreement:

(a)

an opinion from legal counsel to the Agent as to Marshall Islands law, together with the limited liability company documentation of the Borrower supporting the opinion, including but without limitation the Certificate of Formation and Limited Liability Company Agreement as filed with the competent authorities and a certificate of a competent officer or manager of the Borrower containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower, to the effect that:

(i)

the Borrower has been duly formed and is validly existing as a limited liability company under the laws of the Republic of the Marshall Islands;

(ii)

this Agreement falls within the scope of the Borrower’s limited liability company purpose as defined by its Certificate of Formation and Limited Liability Company Agreement;

(iii)

the Borrower’s representatives were at the date of this Agreement fully empowered to sign this Agreement;

(iv)

either all administrative requirements applicable to the Borrower (whether in the Republic of the Marshall Islands), concerning the transfer of funds abroad and acquisitions of Dollars to meet its obligations hereunder have been complied with, or that there are no such requirements; and

(v)

this Agreement constitutes the legal, valid and binding obligations of the Borrower enforceable in accordance with its terms,

and containing such exceptions as are standard for opinions of this type;

(b)	an opinion from legal counsel to the Agent as to English law confirming that the obligations of the Borrower under this Agreement are legally valid and binding obligations enforceable by the relevant Creditor Parties in the English courts;

(c)	a Certified Copy of the executed Shipbuilding Contract;

(d)	a confirmation from EC3 Services Limited that it will act for the Borrower as agent for service of process in England in respect of this Agreement and any other Finance Document;

(e)

an opinion from legal counsel to the Agent as to Panamanian law, together with the corporate documentation of each Guarantor supporting the opinion, including but without limitation the Articles of Incorporation and By-laws as filed with the competent authorities and a certificate of a competent officer of each Guarantor containing specimen signatures of the persons authorised to sign the documents on behalf of the Guarantor, to the effect that:

(i)

each Guarantor has been duly organised and is validly existing and in good standing as a Panamanian sociedad anonima with its domicile in the Republic of Panama and its Resident Agent being (in the case of Prestige Holdings) Arias Fabrega & Fabrega with address at Plaza 2000 Building, 16th Floor, 50th Street, Panama and (in the case of Oceania Cruises) Marcela Rojas de Perez with address at 10 Elvira Mendez Street, Top Floor, Panama;

(ii)

each Guarantee falls within the scope of the relevant Guarantor’s corporate purpose as defined by its Articles of Incorporation and By-laws;

(iii)

each Guarantor’s representative was at the date of the Guarantee issued by it fully empowered to sign that Guarantee;

(iv)

either all administrative requirements applicable to each Guarantor (whether in the Republic of Panama) concerning the transfer of funds abroad and acquisitions of Dollars to meet its obligations under the Guarantee issued by it have been complied with, or that there are no such requirements;

(v)

each Guarantee is the legal, valid and binding obligations of the Guarantor which issued it enforceable in accordance with its terms; and

(vi)

none of the undertakings of either Guarantor contained in either Guarantee are contrary to public policy in the Republic of Panama,

and containing such exceptions as are standard for opinions of this type;

(f)	duly executed originals of the Guarantees;

(g)	an opinion from legal counsel to the Agent as to English law confirming that the obligations of each Guarantor under the Guarantee issued by it are legally valid and binding obligations enforceable by the relevant Creditor Parties in the English courts; and

(h)	confirmation from EC3 Services Limited that it will act for each Guarantor as agent for service of process in England in respect of the Guarantee issued by that Guarantor and any other Finance Document.

3.3

No later than ninety (90) days before the Intended Delivery Date . The Agent shall have received no later than ninety (90) days before the Intended Delivery Date:

(a)	notification from the Borrower of its preferred Maritime Registry;

(b)	the SACE Insurance Policy documentation relating to the transaction contemplated by this Agreement issued on terms whereby the SACE Insurance Policy will enter into full force and effect upon fulfilment of the conditions specified therein to be fulfilled on or before the Drawdown Date; and

(c)	notification of the Approved Manager.

3.4

No later than the date falling ninety (90) days before the Intended Delivery Date and on each subsequent date on which a Compliance Certificate is to be received by the Agent pursuant to clause 11.3(e) of the Prestige Holdings Guarantee and clause 11.3(e) of the Oceania Cruises Guarantee . The Agent shall have received on the date falling ninety (90) days before the Intended Delivery Date and also on each subsequent date on which a Compliance Certificate is to be received by the Agent pursuant to clause 11.3(e) of the Prestige Holdings Guarantee and clause 11.3(e) of the Oceania Cruises Guarantee a duly completed Compliance Certificate from each Guarantor;

3.5

No later than sixty (60) days before the Intended Delivery Date . The Agent shall have received from the Borrower no later than sixty (60) days before the Intended Delivery Date:

(a)	notification of the Intended Delivery Date;

(b)

notification, signed by a duly authorised signatory of the Borrower, specifying which of the Fixed Interest Rate or the Floating Interest Rate shall be applicable to the Loan until the date of payment of the final repayment Instalment of the Loan; and in absence of any such notification, the Borrower shall be deemed to have opted for the Floating Interest Rate.

3.6

No later than fifteen (15) Business Days before the Intended Delivery Date . The Agent shall have received no later than fifteen (15) Business Days before the Intended Delivery Date insurance documents in form and substance satisfactory to the Lenders confirming that the Insurances have been effected and will be in full force and effect on the Delivery Date.

3.7

No later than five (5) Business Days before the Intended Delivery Date . The Agent shall have received no later than five (5) Business Days before the Intended Delivery Date:

(a)	the Drawdown Notice from the Borrower, signed by a duly authorised signatory of the Borrower, specifying the amount of the Loan to be drawn down;

(b)	a Certified Copy of each of the Change Orders, of any amendments to the Shipbuilding Contract and of the power of attorney pursuant to which the authorised signatory of the Borrower signed the Drawdown Notice and a specimen of his signature; and

(c)	a final confirmation of the Intended Delivery Date signed by a duly authorised signatory of the Borrower, and counter-signed by a duly authorised signatory of the Builder.

3.8

No later than the Delivery Date . The Agent shall have received no later than the Delivery Date:

(a)

an opinion from legal counsel to the Agent as to Marshall Islands law together with the limited liability company documentation of the Borrower and a certificate of a competent officer or manager of the Borrower containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower, confirming that:

(i)

the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.2(a);

(ii)

the Mortgage, the General Assignment, the External Management Agreement Assignment (if any), the Post-Delivery Assignment and the Time Charter Assignment (if any) fall within the scope of the Borrower’s limited liability company purpose as defined by its Certificate of Formation and Limited Liability Company Agreement and are binding on it; and

(iii)

the Borrower’s representatives are fully empowered to sign the Protocol of Delivery and Acceptance, the Mortgage, the General Assignment, the External Management Agreement Assignment (if any), the Post-Delivery Assignment and the Time Charter Assignment (if any).

(b)

in the event that the Approved Manager is not a member of the Group, an opinion from legal counsel to the Agent as to the law of the place of incorporation of the Approved Manager, together with the corporate documentation of the Approved Manager supporting the opinion, that the General Assignment (if applicable) and the acknowledgement of the notice of assignment of the External Management Agreement fall within the scope of the Approved Manager’s corporate purpose as defined by its constitutional documents and are binding on it and the Approved Manager’s representatives are fully empowered to sign the General Assignment (if applicable) and the acknowledgement of the notice of assignment of the External Management Agreement;

(c)	evidence of payment to the Builder of:

(i)

the [*] ([*]) pre-delivery instalments of the Final Contract Price; and

(ii)

any other part of the Final Contract Price as at the Delivery Date not being financed hereunder;

(d)	evidence of payment of all amounts which are due and payable hereunder by the Borrower on or prior to the Delivery Date;

(e)	a certificate from the Borrower, signed by an authorised representative of the Borrower, confirming that the representations and warranties contained in Clause 12 are true and correct as of the Delivery Date in consideration of the facts and circumstances existing as of the Delivery Date;

(f)	the Interest Make-up Agreement relative to the Loan and in full force and effect;

provided always that the obligations of the Lenders to make the Loan available on the Delivery Date are subject to the Agent remaining satisfied that each of the SACE Insurance Policy and the Interest Make-up Agreement will cover the Loan following the advance of the Loan, payment of the second instalment of the SACE Premium and delivery to SACE of the documents listed in Schedule 3.

3.9

At Delivery .

Immediately prior to the delivery of the Ship by the Builder to the Borrower, the Agent shall have received:

(a)	evidence that immediately following delivery:

(i)

the Ship will be registered in the name of the Borrower in the Maritime Registry;

(ii)

title to the Ship will be held by the Borrower free of all Security Interests other than any maritime lien in respect of crew’s wages and trade debts arising out of equipment, consumable and other stores placed on board the Ship prior to or concurrently with delivery, none of which is overdue;

(iii)

the Mortgage will be duly registered in the Maritime Registry and constitutes a first priority security interest over the Ship and that all taxes and fees payable to the Maritime Registry in respect of the Ship have been paid in full; and

(iv)

the opinions mentioned in Clauses 3.9(j), (k) and (1) and the documents mentioned in Clause 3.9(m) will be received by the Agent;

(b)	a Certified Copy of a classification certificate (or interim classification certificate) showing the Ship to be classed in accordance with Clause 12.4(c).

(c)

duly executed originals of the General Assignment, any External Management Agreement Assignment, any Approved Manager’s Undertaking, the Post-Delivery Assignment and any Time Charter Assignment together with relevant notices of assignment and the acknowledgement of the notice of assignment to be issued pursuant to any External Management Agreement Assignment and the Post-Delivery Assignment and the Time Charter Assignment (if any);

(d)	a duly executed original of the Limited Liability Company Interests Security Deed (and of each document required to be delivered under the Limited Liability Company Interests Security Deed);

(e)	a Certified Copy of any executed External Management Agreement and any time charter party in respect of the Ship;

(f)

a Certified Copy of any current certificate of financial responsibility in respect of the Ship issued under OPA, a valid Safety Management Certificate (or interim Safety Management Certificate) issued to the Ship in respect of its management by the Approved Manager pursuant to the ISM Code, a valid Document of Compliance (or interim Document of Compliance) issued to the Approved Manager in respect of ships of the same type as the Ship pursuant to the ISM Code, a valid International Ship Security Certificate issued to the Ship in accordance with the ISPS Code and a valid IAPPC issued to the Ship in accordance with Annex VI and, if entered into, any carrier initiative agreement with the United States’ Customs and Border Protection under the Customs-Trade Partnership Against Terrorism (C-TPAT) programme;

(g)	a Certified Copy of the power of attorney pursuant to which the authorised signatory(ies) of the Borrower signed the documents referred to in this Clause 3.8 and to which the Borrower is a party and a specimen of his or their signature(s);

(h)

a confirmation from EC3 Services Limited that it will act for each of the relevant Obligors as agent for service of process in England in respect of the deed of covenants constituting part of the Mortgage (if applicable), the General Assignment, the External Management Agreement Assignment (if any), the Post-Delivery Assignment and the Time Charter Assignment (if any).

Immediately following the delivery of the Ship by the Builder to the Borrower, the Agent shall receive:

(i)	a duly executed original of the Mortgage;

(j)

an opinion from legal counsel to the Agent as to Panamanian law, together with the corporate documentation of Oceania Cruises supporting the opinion and a certificate of a competent officer of Oceania Cruises containing specimen signatures of the persons authorised to sign the Limited Liability Company Interests Security Deed on behalf of Oceania Cruises confirming that:

(i)

the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.2 (e) in so far as it relates to Oceania Cruises;

(ii)

the Limited Liability Company Interests Security Deed falls within the scope of Oceania Cruises’ corporate purpose as defined by its Articles of Incorporation and By-laws; and

(iii)

the representative of Oceania Cruises was at the date of the Limited Liability Company Interests Security Deed fully empowered to sign the Limited Liability Company Interests Security Deed.

(k)	an opinion from legal counsel to the Agent as to the law of the Maritime Registry confirming:

(i)

the valid registration of the Ship in the Maritime Registry; and

(ii)

the Mortgage over the Ship has been validly registered in the Maritime Registry;

(l)

an opinion from legal counsel to the Agent as to English law confirming that the obligations of the Borrower under the deed of covenants constituting part of the Mortgage (if applicable), the General Assignment, any External Management Agreement Assignment, the Post-Delivery Assignment and any Time Charter Assignment are legally valid and binding obligations enforceable by the relevant Creditor Parties in the English courts;

(m)	the documents listed in Schedule 3.

4	DRAWDOWN

4.1

Borrower’s irrevocable payment instructions . The Lenders shall not be obliged to fulfil their obligation to make the Loan available other than by paying the Builder all or part of 80% of the Final Contract Price up to the Eligible Amount on behalf of and in the name of the Borrower and by reimbursing the Agent for the instalment of the SACE Premium payable on the Delivery Date.

The Borrower hereby instructs the Lenders in accordance with this Clause 4.1:

(a)	to pay to the Builder all or part of 80% of the Final Contract Price up to the Eligible Amount.

(b)	to pay to the Agent on behalf of the Lenders for onward payment to SACE (such payment to SACE to be made for value on the Drawdown Date), by drawing under the Loan, the amount of the second instalment of the related SACE Premium.

Payment to the Builder of the Dollar amount drawn under Clause 4.1(a) above shall be made on the Delivery Date of the Ship during usual banking hours in Italy to the Builder’s account as specified by the Builder in accordance with the Shipbuilding Contract after receipt and verification by the Agent of the documents provided under Schedule 3.

Verification of the documents provided under Schedule 3 shall be limited to checking their apparent compliance as defined in the Uniform Customs and Practices for Documentary Credits—ICC Publication 600 (UCP 600 latest revision).

Save as contemplated in Clause 4.3 below, the payment instruction contained in this Clause 4.1 is irrevocable.

4.2

Conversion Rate for Loan . The Dollar amount to be drawn down under Clause 4.1(a) shall be calculated by the Agent on the Conversion Rate Fixing Date in accordance with the definitions of “Eligible Amount” and “Conversion Rate” in Clause 1.1.

4.3

Modification of payment terms . The Borrower expressly acknowledges that the payment terms set out in this Clause may only be modified with the agreement of the Builder, the Agent, the Lenders and the Borrower in the case of Clause 4.1(a) and with the agreement of the Agent, the Lenders and the Borrower in the case of Clause 4.1(b); Provided that it is the intention of the Borrower, the Lenders and the Agent that prior to the Delivery Date agreement shall be reached with those financial institutions with whom the Borrower has entered into the FOREX Contracts (the “ Counterparties ”) in order that the Euro payments due from the Counterparties under the FOREX Contracts shall be paid to the Agent for holding in escrow and to be released by the Agent simultaneously with (i) the payment in full to the Builder of the balance of the Final Contract Price denominated in Euro at the tone of Delivery of the Ship and (ii) the payment to the Counterparties of the Dollars due to them under the relevant FOREX Contracts out of the Dollar amount available under Clause 4.1(a), subject only to delivery of the Ship by the Builder to the Borrower taking place as evidenced by the execution and delivery of the Protocol of Delivery and Acceptance and to the Borrower having deposited with the Agent before Delivery, if and to the extent required, any Dollar and/or Euro amounts as may be needed to ensure the payment in full of both the balance of the Final Contract Price in Euro and the Dollars owed to the Counterparties under all the relevant FOREX Contracts.

4.4

Availability . Drawing may not be made under this Agreement (and the Loan shall not be available) after the earlier of the Delivery Date and the expiry of the Availability Period.

4.5

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 Loan and the Drawdown Date;

(b)	the amount of that Lender’s participation in the Loan; and

(c)	the duration of the first Interest Period.

4.6

Lenders to make available Contributions . Subject to the provisions of this Agreement, each Lender shall, on and with value on the Drawdown Date, make available to the Agent the amount due from that Lender under Clause 2.2.

4.7

Disbursement of Loan . Subject to the provisions of this Agreement, the Agent shall on the Drawdown Date pay the amounts which the Agent receives from the Lenders under Clause 4.6:

(a)	in the case of the amount referred to in Clause 4.1(a), to the account which the Borrower specifies in the Drawdown Notice;

(b)	in the case of the amount referred to in Clause 4.1(b) to the account of SACE which the SACE Agent shall specify; and

(c)	in the like funds as the Agent received the payments from the Lenders.

4.8

Disbursement of Loan to third party . The payment by the Agent under Clause 4.7 shall constitute the making of the Loan and the Borrower shall at that time become indebted, as principal and direct obligor, to each Lender in an amount equal to that Lender’s Contribution.

5	REPAYMENT

5.1

Number of repayment instalments . The Borrower shall repay the Loan by twenty-four (24) consecutive six-monthly instalments.

5.2

Repayment Dates . The first instalment shall be repaid on the date falling six (6) months after the Drawdown Date and the last instalment on the date falling one hundred and forty four (144) months after the Drawdown Date, each date of payment of an instalment being a “ Repayment Date ”.

5.3

Amount of repayment instalments . Each of the twenty-four (24) consecutive six-monthly repayment instalments of the Loan shall be of an equal amount.

5.4

Final Repayment Date . On the final Repayment Date, the Borrower shall additionally pay to the Agent for the account of the Creditor Parties all other sums then accrued or owing under any Finance Document.

6	INTEREST

6.1

Fixed Interest Rate . If the Borrower has specified a Fixed Interest Rate pursuant to Clause 3.5(b), the Loan shall bear interest at the CIRR. Such interest shall accrue on the actual number of days elapsed based upon a 360 day year and shall be paid on each Repayment Date.

6.2

Floating Interest Rate . If:

(a)	the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b); or

(b)	the Borrower has specified a Fixed Interest Rate pursuant to Clause 3.5(b) but thereafter for any reason whatsoever the Interest Make-up Agreement shall cease to be in effect,

the rate of interest on the Loan in respect of any Interest Period shall be the Floating Interest Rate applicable for that Interest Period and the following provisions of this Clause 6 shall apply (in the case of the circumstances referred to in paragraph (b) above, with effect from the date on which the Interest Make-up Agreement ceases to be in effect, with such consequential amendments as shall be necessary to give effect to the switch from a Fixed Interest Rate to a Floating Interest Rate).

6.3

Payment of Floating Interest Rate . Subject to the provisions of this Agreement, interest on the Loan in respect of each Interest Period shall accrue on the actual number of days elapsed based upon a 360 day year and shall be paid by the Borrower on the last day of that Interest Period.

6.4

Notification of Interest Periods and Floating Interest Rate . The Agent shall notify the Borrower and each Lender of each Floating Interest Rate and the duration of each Interest Period as soon as reasonably practicable after each is determined and no later than the Quotation Date.

6.5

Market disruption . The following provisions of this Clause 6 apply if:

(a)	No rate is quoted on “Reuters Page LIBOR 01” (or any other page replacing it) and the Lenders do not, before 1.00 p.m. (London time) on the Quotation Date for an Interest Period, provide quotations to the Agent in order to fix LIBOR; or

(b)

at least 1 Business Day before the start of an Interest Period, Lenders having Contributions together amounting to more than [*] per cent. of the Loan (or, if the Loan has not been made, Commitments amounting to more than [*] per cent. of the Total Commitments) notify the Agent that LIBOR fixed by the Agent would not accurately reflect the cost to those Lenders of funding their respective Contributions (or any part of them) during the Interest Period in the London Interbank Market at or about 11.00 a.m. (London time) on the Quotation Date for the Interest Period; or

(c)	at least 1 Business Day before the start of an Interest Period, the Agent is notified by a Lender (the “ Affected Lender ”) that for any reason it is unable to obtain Dollars in the London Interbank Market in order to fund its Contribution (or any part of it) during the Interest Period.

6.6

Notification of market disruption . The Agent shall promptly notify the Borrower and each of the Lenders stating the circumstances falling within Clause 6.5 which have caused its notice to be given.

6.7

Suspension of drawdown . If the Agent’s notice under Clause 6.5 is served before the Loan is made:

(a)	in a case falling within Clauses 6.5(a) or 6.5(b), the Lenders’ obligations to make the Loan;

(b)	in a case falling within Clause 6.5(c), the Affected Lender’s obligation to participate in the Loan;

shall be suspended while the circumstances referred to in the Agent’s notice continue.

6.8

Negotiation of alternative rate of interest . If the Agent’s notice under Clause 6.6 is served after the Loan 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 30 days after the date on which the Agent serves its notice under Clause 6.6 (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 Interest Period concerned.

6.9

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.

6.10

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 or (as the case may be) the Affected Lender, set an interest period and interest rate representing the cost of funding of the Lenders or (as the case may be) the Affected Lender in Dollars or in any available currency of their or its Contribution plus the Margin; and the procedure provided for by this Clause 6.10 shall be repeated if the relevant circumstances are continuing at the end of the interest period so set by the Agent.

6.11

Notice of prepayment . If the Borrower does not agree with an interest rate set by the Agent under Clause 6.10, the Borrower may give the Agent not less than 15 Business Days’ notice of its intention to prepay at the end of the interest period set by the Agent.

6.12

Prepayment; termination of Commitments . A notice under Clause 6.11 shall be irrevocable; the Agent shall promptly notify the Lenders or (as the case may require) the Affected Lender of the Borrower’s notice of intended prepayment; and:

(a)	on the date on which the Agent serves that notice, the Total Commitments or (as the case may require) the Commitment of the Affected Lender shall be cancelled; and

(b)	on the last Business Day of the interest period set by the Agent, the Borrower shall prepay (without premium or penalty) the Loan or, as the case may be, the Affected Lender’s Contribution, together with accrued interest thereon at the applicable rate plus the Margin.

6.13

Application of prepayment . The provisions of Clause 16 shall apply in relation to the prepayment.

7	INTEREST PERIODS

7.1

Floating Interest Rate . This Clause 7 applies where the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b).

7.2

Commencement of Interest Periods . The first Interest Period shall commence on the Drawdown Date and each subsequent Interest Period shall commence on the expiry of the preceding Interest Period.

7.3

Duration of Interest Periods . Each Interest Period shall be 6 months and shall end on the next succeeding Repayment Date.

8	CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS

8.1

Liability Preserved . The Borrower may not escape liability under the terms of this Agreement by opposing to the Lenders claims or defences of any kind whatsoever arising under the Shipbuilding Contract, and in particular from its performance, or from any other relationship between the Borrower and the Builder.

9	SACE PREMIUM AND ITALIAN AUTHORITIES

9.1

SACE Premium . The estimated SACE Premium is due and payable in two instalments as follows:

(a)

the first instalment of the SACE Premium shall be paid to SACE within 30 days of the issue of the SACE Insurance Policy documentation in the form required by clause 3.3(b) of this Agreement and shall be in such amount in Dollars as is calculated by the Agent to be the equivalent of EUR [*] converted at the Base Rate (the “ First Instalment ”); and

(b)

the second instalment of the SACE Premium shall be such amount in Dollars as is calculated by the Agent to be the product of (i) [*]% of the Loan actually advanced on the Drawdown Date LESS (ii) the amount of the First Instalment (the “ Second Instalment ”) and shall be payable on the Drawdown Date.

9.2

Reimbursement by the Borrower of the SACE Premium . The Borrower irrevocably agrees to pay the First Instalment, and to instruct the Lenders to pay the Second Instalment on behalf of the Borrower, as follows:

(a)	The First Instalment shall be paid to SACE by the Borrower through the Agent upon notification by the Agent to the Borrower (i) of the issue of the SACE Insurance Policy documentation in the form required by clause 3.3(b) of this Agreement, and (ii) of the amount of the First Instalment.

(b)	The Borrower has requested and the Lenders have agreed to finance the payment of [] per cent. ([]%) of the Second Instalment on the Drawdown Date in accordance with Clause 2.1(b) of this Agreement.

Consequently, the Borrower hereby irrevocably instructs the Agent on behalf of the Lenders to pay the Second Instalment to SACE on the Drawdown Date and to reimburse themselves by drawing under the Loan the amount of the Second Instalment in accordance with Clause 2.1(b) of this Agreement.

The Second Instalment financed by the Loan will be repayable in any event by the Borrower to the Lenders in the manner specified in Clause 5 and under any and all circumstances including but without limitation in the event of prepayment or acceleration of the Loan.

9.3

Italian Authorities .

(a)

The Borrower acknowledges and agrees that the Agent and the Lenders are entitled to provide the Italian Authorities with any information they may have relative to the Loan and the business of the Group, to allow the Italian Authorities to inspect all their records relating to this Agreement and the other Transaction Documents and to furnish them with copies thereof. Any such information relative to the Loan may also be given by any Italian Authorities to international institutions charged with collecting statistical data.

(b)

The Borrower acknowledges that, in the making of any decision or determination or the exercise of any discretion or the taking or refraining to take any action under this Agreement or any of the other Finance Documents, the Agent and the Lenders shall be deemed to have acted reasonably if they have acted on the instructions of either of the Italian Authorities.

(c)	Each Party further undertakes not to act in a manner which is inconsistent with the terms of the SACE Insurance Policy.

9.4

Refund . In accordance with the SACE Policy, the Borrower has the right to receive a refund of the first instalment of the SACE Premium referred to in Clause 9.1 (a), provided that no Event of

Default has occurred, in the event that no drawings have been made under this Agreement and the parties have mutually decided to cancel the SACE Insurance Policy following cancellation of the Total Commitments in accordance with Clause 16.1. In these circumstances, the Borrower may request in writing through the SACE Agent, and shall be entitled to receive from SACE through the SACE Agent, a refund of the first instalment of the SACE Premium subject to a deduction for SACE’s administrative charges as calculated by SACE in an amount of not less than 15% of the refund or EUR 3,000 (calculated at the exchange rate valid at the date of the refund request) whichever is the higher.

In no event shall the SACE Agent be liable for any refund of the SACE Premium to be made by SACE.

FEES

10.1

Fees . The following fees shall be paid to the Agent by the Borrower as required hereunder:

(a)	for the Mandated Lead Arrangers and the SACE Agent, an arrangement fee in an amount and payable at the time separately agreed in writing between the Mandated Lead Arrangers, the SACE Agent and the Borrower;

(b)

for the Lenders, a commitment fee in Dollars for the period from the date of this Agreement to the Delivery Date of the Ship, or the date of receipt by the Agent of the written cancellation notice sent by the Borrower as described in Clause 14.1, whichever is the earliest, computed at the rate of [*] per cent. ([*]%) per annum and calculated on the undrawn amount of the Maximum Loan Amount and payable in arrears on the date falling six (6) months after the date of this Agreement and on each date falling at the end of each following consecutive six (6) month period, with the exception of the commitment fee due in respect of the last period, which shall be paid on the Drawdown Date, or the date of receipt by the Agent of the written cancellation notice sent by the Borrower as described in Clause 16.1, whichever is the earliest, such commitment fee to be calculated on the actual number of days elapsed divided by three hundred and sixty (360);

For the purpose of the computation of the periodical commitment fee payable to the Lenders, the Maximum Loan Amount is assumed to be USD 608,082,164;

In the event the actual amount drawn under the Loan on the Delivery Date is higher, the Borrower shall on the Delivery Date pay the difference between the aggregate commitment fee amounts paid up to that date and the aggregate commitment fee computed on the actual amount to be drawn on the Delivery Date;

(c)	for the Agent, an agency fee of $[*] payable within ten (10) Business Days of the date of this Agreement and on or before each anniversary date thereof until total repayment of the Loan unless the Total Commitments are terminated pursuant to Clause 16.1.

11	TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES

11.1

Warranty . The Creditor Parties each warrant to the Borrower that as at the date of this Agreement there are no Taxes payable in France as a consequence of the signature or performance of this Agreement (other than Taxes payable by each of the Lenders on its overall net income). Each of the Lenders specified in Schedule 1 undertakes that: (i) its Facility Office is located in France at the date of this Agreement; and (ii) it will not relocate its Facility Office to another jurisdiction if such relocation could result in the imposition of Taxes in connection with signature or performance of this Agreement (other than Taxes payable by a Lender on its overall net income), it being agreed, for the avoidance of doubt, that each Lender shall be entitled at any time to relocate its Facility Office to another jurisdiction provided that such relocation does not affect the tax status of the transaction for the Borrower by reference to the tax status that would apply were its Facility Office to be located in France.

11.2

Taxes . All Taxes legally payable (other than Taxes payable by each of the Lenders on its overall net income) as a consequence of the signature or performance of this Agreement shall be paid by the Borrower. In consequence, all payments of principal and interest, interest on late payments, compensation, costs, fees and related charges, due in connection with this Agreement shall be made without any deduction or withholding in respect of Taxes. The Borrower therefore hereby agrees expressly that if for any reason full payment of the above amounts is not made, it will immediately pay the Lenders the sums necessary to compensate exactly the effect of the deductions or withholdings made in respect of Taxes. If the Borrower fails to perform this obligation, the Lenders shall be entitled, in accordance with Clause 18, either not to make available the Loan or, as the case may require, to require immediate repayment of the Loan.

If an additional payment is made under this Clause and any Lender or the Agent on its behalf determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional payment, such Lender or the Agent (as the case may be) shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Borrower such amount as such Lender or the Agent shall in its reasonable opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Borrower hereunder and shall be accepted by the Borrower in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.

11.3

Increased Costs . If after the date of this Agreement by reason of:

(a)	any change in law or in its interpretation or administration; and/or

(b)	compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority including but without limitation the Basle Committee on Banking Regulations and Supervisory Practices whether or not having the force of law:

(i)

any of the Lenders incurs a cost as a result of its performing its obligations under this Agreement and/or its making available its Commitment hereunder; or

(ii)

there is any increase in the cost to any of the Lenders of funding or maintaining all or any of the advances comprised in a class of advances formed by or including its Commitment advanced or to be advanced by it hereunder; or

(iii)

any of the Lenders incurs a cost as a result of its having entered into and/or its assuming or maintaining its commitment under this Agreement; or

(iv)

any of the Lenders becomes liable to make any payment on account of Tax or otherwise (other than Tax on its overall net income) on or calculated by reference to the amount of its Commitment advanced or to be advanced hereunder and/or any sum received or receivable by it hereunder; or

(v)

any of the Lenders suffers any decrease in its rate of return as a result of any changes in the requirements relating to capital ratios, monetary control ratios, the payment of special deposits, liquidity costs or other similar requirements affecting that Lender,

then the Borrower shall from time to time on demand pay to the Agent for the account of the relevant Lender or Lenders amounts sufficient to indemnify the relevant Lender or Lenders against, as the case may be, such cost, such increased cost (or such proportion of such increased cost as is in the reasonable opinion of the relevant Lender or Lenders attributable to the funding or maintaining of its or their Commitment(s) hereunder) or such liability.

A Lender affected by any provision of this Clause 11.3 shall promptly inform the Agent after becoming aware of the relevant change and its possible results (which notice shall be conclusive evidence of the relevant change and its possible results) and the Agent shall, as soon as reasonably practicable thereafter, notify the Borrower of the change and its possible results. Without affecting the Borrower’s obligations under this Clause 11.3 and in consultation with the Agent, the affected Lender will then take all such reasonable steps as may be open to it to mitigate the effect of the change (for example (if then possible) by changing its Facility Office or transferring some or all of its rights and obligations under this Agreement to another financial institution reasonably acceptable to the Borrower and the Agent). The reasonable costs of mitigating the effect of any such change shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by any Lender with third parties.

11.4

Transaction Costs . The Borrower undertakes to pay to the Agent, upon demand, all costs and expenses, duties and fees, including but without limitation agreed legal costs, out of pocket expenses and travel costs, incurred by the Mandated Lead Arrangers and the Lenders (but not including any bank which becomes a Lender after the date of this Agreement) in connection with the negotiation, preparation and execution of all agreements, guarantees, security agreements and related documents entered into, or to be entered into, for the purpose of the transaction contemplated hereby as well as all costs and expenses, duties and fees incurred by the Agent or the Lenders in connection with the registration, filing, enforcement or discharge of the said guarantees or security agreements, including without limitation the fees and expenses of legal advisers and insurance experts and the fees and expenses of SACE (including the fees and expenses of its legal advisers) payable by the Mandated Lead Arrangers to SACE, the cost of registration and discharge of security interests and the related travel and out of pocket expenses; the Borrower further undertakes to pay to the Agent all costs, expenses, duties and fees incurred by the Lenders and SACE in connection with any variation of this Agreement and the related documents, guarantees and security agreements, any supplements thereto and waiver given in relation thereto, in connection with the enforcement or preservation of any rights under this Agreement and/or the related guarantees and security agreements, including in each case the fees and expenses of legal advisers, and in connection with the consultations or proceedings made necessary or in the opinion of the Agent desirable by the acts of, or failure to act on the part of, the Borrower.

11.5

Costs of delayed Delivery Date . The Borrower undertakes to pay to the Agent, upon demand, any costs incurred by the Lenders in funding the Loan in the event that the Delivery Date is later than the Intended Delivery Date unless the Borrower has given the Agent at least three (3) Business Days’ notification of such delay in the Delivery Date.

12	REPRESENTATIONS AND WARRANTIES

12.1

Timing and repetition . The following applies in relation to the time at which representations and warranties are made and repeated:

(a)

the representations and warranties in Clause 12.2 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Finance Documents;

(b)	the representations and warranties in Clause 12.3 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances

subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Finance Documents; and

(c)

the representations and warranties in Clause 12.4 are made on the Delivery Date and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Finance Documents.

12.2

Continuing representations and warranties . The Borrower represents and warrants to each of the Lenders that:

(a)

each Obligor is a limited liability company or body corporate duly organised, constituted and validly existing under the laws of the country of its formation or (as the case may be) incorporation, possessing perpetual existence, the capacity to sue and be sued in its own name and the power to own and charge its assets and carry on its business as it is now being conducted;

(b)

each Obligor has the power to enter into and perform this Agreement and those of the other Transaction Documents to which it is a party and the transactions contemplated hereby and thereby and has taken all necessary action to authorise the entry into and performance of this Agreement and such other Transaction Documents and such transactions;

(c)

this Agreement and each other Transaction Document constitutes (or will constitute when executed) legal, valid and binding obligations of each Obligor expressed to be a party thereto enforceable in accordance with their respective terms and in entering into this Agreement and borrowing the Loan, the Borrower is acting on its own account;

(d)	the entry into and performance of this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby do not and will not conflict with:

(i)

any law or regulation or any official or judicial order; or

(ii)

the constitutional documents of any Obligor; or

(iii)

any agreement or document to which any Obligor is a party or which is binding upon such Obligor or any of its assets,

nor result in the creation or imposition of any Security Interest on the Borrower or its assets pursuant to the provisions of any such agreement or document, except for Security Interests which qualify as Permitted Security Interests with respect to the Borrower;

(e)	except for:

(i)

the filing of UCC-1 Financing Statements against the Borrower in respect of those Financing Documents to which it is a party and which create Security Interests;

(ii)

the recording of the Mortgage in the office of the Maritime Administrator of the Republic of the Marshall Islands; and

(iii)

the registration of the Ship under an Approved Flag,

effected and are in full force and effect except authorisations, approvals, consents, licences, exemptions, filings and registrations required in the normal day to day course of the operation of the Ship and not already obtained by the Borrower;

(f)

all information furnished by any Obligor relating to the business and affairs of any Obligor in connection with this Agreement and the other Transaction Documents was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading;

(g)	each Obligor has fully disclosed to the Agent all facts relating to each Obligor which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into this Agreement;

(h)

the claims of the Creditor Parties against the Borrower under this Agreement will rank at least pari passu with the claims of all unsecured creditors of the Borrower (other than claims of such creditors to the extent that they are statutorily preferred) and in priority to the claims of any creditor of the Borrower who is also an Obligor;

(i)	the Borrower is and shall remain, after the advance to it of the Loan, solvent in accordance with the laws of the Marshall Islands and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof;

(j)

neither the Borrower nor any other Obligor has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against any of them for the reorganisation, winding-up, dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver, trustee or similar officer of any of them or any or all of their assets or revenues nor has it sought any other relief under any applicable insolvency or bankruptcy law;

(k)

the consolidated audited accounts of both Guarantors for the period ending on (in the case of Prestige Holdings) 31 December 2007 or (in the case of Oceania Cruises) 31 December 2008 or (in relation to any date on which this representation and warranty is deemed to be repeated pursuant to Clause 12.1(a)) the latest available annual consolidated audited accounts of each Guarantor at the date of repetition (which accounts have been prepared in accordance with GAAP) fairly represent the financial condition of each Guarantor as shown in such audited accounts;

(l)	none of the Obligors nor any of their respective assets enjoys any right of immunity (sovereign or otherwise) from set-off, suit or execution in respect of their obligations under this Agreement or any of the other Transaction Documents or by any relevant or applicable law;

(m)

all the membership interest in the Borrower and all shares or membership interest in any Approved Manager which is a member of the Group shall be legally and beneficially owned directly or indirectly by (in the case of the Borrower) Oceania Cruises and (in the case of such Approved Manager) Prestige Holdings and such structure shall remain so throughout the Security Period;

(n)

the copies of the Shipbuilding Contract, any External Management Agreement, any charter and any charter guarantee being the subject of a Time Charter Assignment (if any) and any other relevant third party agreements including but without limitation the copies of any documents in respect of the Insurances delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and, subject to Clauses 13.14 and 13.24, no amendments thereto or variations thereof have been agreed nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable; and

(o)

any borrowing by the Borrower under this Agreement, and the performance of its obligations under this Agreement and the other Transaction Documents, will be for its own account and will not involve any breach by it of any law or regulatory measure relating to “money laundering” as defined in Article 1 of the Directive (91/308/EEC) of the Council of the European Communities.

12.3

Semi-continuing representations and warranties . The Borrower represents and warrants to each of the Lenders that:

(a)

no event has occurred which constitutes a default under or in respect of any Transaction Document to which any Obligor or the Builder is a party or by which any Obligor or the Builder may be bound (including (inter alia) this Agreement) and no event has occurred which constitutes a default under or in respect of any agreement or document to which any Obligor is a party or by which any Obligor may be bound to an extent or in a manner which might have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party;

(b)	none of the assets or rights of the Borrower is subject to any Security Interest except any Security Interest which qualifies as a Permitted Security Interest with respect to the Borrower;

(c)	no litigation, arbitration or administrative proceedings are current or pending or, to its knowledge, threatened, which might, if adversely determined, have a material adverse effect on the ability of an Obligor to perform its obligations under the Transaction Documents to which it is a party;

(d)	to the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it;

(e)	each member of the Group has good and marketable title to all its assets which are reflected in the audited accounts referred to in Clause 12.2(k);

(f)	none of the Obligors has a place of business in any jurisdiction (except as already disclosed) which requires any of the Finance Documents to be filed or registered in that jurisdiction to ensure the validity of the Finance Documents to which it is a party;

(g)	each of the Obligors and each member of the Group:

(i)

is in compliance with all applicable federal, state, local, foreign and international laws, regulations, conventions and agreements relating to pollution prevention or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, navigable waters, water of the contiguous zone, ocean waters and international waters), including without limitation, laws, regulations, conventions and agreements relating to:

(A)

emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous materials, oil, hazard substances, petroleum and petroleum products and by-products (“ Materials of Environmental Concern ”); or

(B)

the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (such laws, regulations, conventions and agreements the “ Environmental Laws ”);

(ii)

has all permits, licences, approvals, rulings, variances, exemptions, clearances, consents or other authorisations required under applicable Environmental Laws (“ Environmental Approvals ”) and is in compliance with all Environmental Approvals required to operate its business as presently conducted or as reasonably anticipated to be conducted;

(iii)

has not received any notice, claim, action, cause of action, investigation or demand by any other person, alleging potential liability for, or a requirement to incur, investigatory costs, clean-up costs, response and/or remedial costs (whether incurred by a governmental entity or otherwise), natural resources damages, property damages, personal injuries, attorney’s fees and expenses or fines or penalties, in each case arising out of, based on or resulting from:

(A)

the presence or release or threat of release into the environment of any Material of Environmental Concern at any location, whether or not owned by such person; or

(B)

circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or Environmental Approval (“ Environmental Claim ”); and

there are no circumstances that may prevent or interfere with such full compliance in the future.

There is no material Environmental Claim pending or threatened against any of the Obligors or any member of the Group.

There are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge or disposal of any Material of Environmental Concern, that could form the basis of any Environmental Claim against any of the Obligors or any member of the Group.

12.4

Representations on the Delivery Date . The Borrower further represents and warrants to each of the Lenders that on the Delivery Date the Ship will be:

(a)	in its absolute and unencumbered ownership save as contemplated by the Finance Documents;

(b)	registered in its name under the laws and flag of the Maritime Registry;

(c)	classed with the highest classification available for a Ship of its type free of all recommendations and qualifications with Lloyd’s Register, RMA or Bureau Veritas;

(d)	operationally seaworthy and in compliance with all relevant provisions, regulations and requirements (statutory or otherwise) applicable to ships registered under the laws and flag of the Maritime Registry;

(e)	in compliance with the ISM Code, the ISPS Code and Annex VI;

(f)	insured in accordance with the provisions of Clause 13.20 and in compliance with the requirements therein in respect of such insurances; and

(g)	managed by the Approved Manager and, in the event that the Approved Manager is not a member of the Group, on and subject to the terms set out in the External Management Agreement.

13	UNDERTAKINGS

13.1

General . The Borrower undertakes with each Creditor Party to comply with the following undertakings during the Security Period.

13.2

Information . The Borrower will provide to the Agent for the benefit of the Lenders (or will procure the provision of):

(a)

as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its unaudited accounts for that year and a Certified Copy of the audited consolidated accounts of both Guarantors and their subsidiaries for that year (commencing with accounts made up to 31 December in the year in which the Drawdown Date occurs in the case of the Borrower and with accounts made up to 31 December 2007 in the case of the consolidated accounts of Prestige Holdings and up to 31 December 2008 in the case of the consolidated accounts of Oceania Cruises);

(b)	as soon as practicable (and in any event within ninety (90) days of the commencement of each financial year) its budgetary forecast for the two following years;

(c)

as soon as practicable (and in any event within forty-five (45) days of the end of the following month) a copy of the unaudited consolidated quarterly management accounts (including current and year-to-date profit and loss statements and balance sheet compared to the previous year and to budget) of each Guarantor;

(d)	promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group as the Agent may reasonably request for the benefit of the Creditor Parties; and

(e)

details of any material litigation, arbitration or administrative proceedings which affect any company in the Group as soon as the same are instituted and served, or, to the knowledge of the Borrower, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding Twenty million Dollars or the equivalent in another currency).

All accounts required under this Clause 13.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company.

13.3

Notification of default . The Borrower will notify the Agent of any Event of Default forthwith upon becoming aware of the occurrence thereof. Upon the Agent’s request from time to time the Borrower will issue a certificate stating whether any Obligor is aware of the occurrence of any Event of Default.

13.4

Consents and registrations . The Borrower will procure that (and will promptly furnish Certified Copies to the Agent on the request of the Agent of) all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it or any Obligor to perform its obligations under, and ensure the validity or enforceability of, each of the Transaction Documents are obtained and promptly renewed from time to time and will procure that the terms of the same are complied with at all times. Insofar as such filings or registrations have not been completed on or before the Drawdown Date the Borrower will procure the filing or registration within applicable time limits of each Finance Document which requires filing or registration together with all ancillary documents required to preserve the priority and enforceability of the Finance Documents.

13.5

Negative pledge . The Borrower will not create or permit to subsist any Security Interest on the whole or any part of its present or future assets, except for the following:

(a)	Security Interests created with the prior consent of the Agent; or

(b)	Security Interests qualifying as Permitted Security Interests with respect to the Borrower and described in paragraphs (a) and (b) of the definition of “Permitted Security Interests” in Clause 1.1; or

(c)	Security Interests qualifying as Permitted Security Interests with respect to the Borrower and described in paragraphs (c), (e), (h) or (i) of such definition, provided that insofar as they are enforceable against the Ship, they do not prevail over the Mortgage.

13.6

Disposals . Except in the case of a sale of the Ship if the completion of the sale is contemporaneous with prepayment of the Loan in accordance with the provisions of Clause 16.3 and except for charters and other arrangements complying with Clause 13.12, the Borrower shall not without the consent of the Majority Lenders, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, sell, transfer, lease or otherwise dispose of the Ship or any of the Ship’s equipment except in the case of items being replaced or renewed provided that the net impact is not a reduction in the value of the Ship.

13.7

Change of business . Except with the prior consent of the Agent, the Borrower shall not make or threaten to make any substantial change in its business as presently conducted, namely that of a single ship owning company for the Ship, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the opinion of the Agent, the Borrower’s ability to perform its obligations hereunder.

13.8

Mergers . Except with the prior consent of the Lenders, the Borrower will not enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger or consolidation or anything analogous to the foregoing nor will it acquire any equity, share capital or obligations of any corporation or other entity.

13.9

Maintenance of status and franchises . The Borrower will do all such things as are necessary to maintain its limited liability company existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.

13.10

Financial records . The Borrower will keep proper books of record and account, in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Borrower in accordance with GAAP.

13.11

Financial indebtedness and subordination of indebtedness . The following restrictions shall apply:

(a)

otherwise than in the ordinary course of business as owner of the Ship, except as contemplated by this Agreement and except any loan, advance or credit extended by a Guarantor or any member of the Group which is a wholly owned subsidiary of Prestige Holdings, the Borrower will not create, incur, assume or allow to exist any financial indebtedness, enter into any finance lease or undertake any material capital commitment (including but not limited to the purchase of any capital asset); and

(b)

the Borrower shall procure that any and all indebtedness (and in particular with any other Obligor) is at all times fully subordinated to the Finance Documents and the obligations of the Borrower hereunder. Upon the occurrence of an Event of Default, the Borrower shall not make any repayments of principal, payments of interest or of any other costs, fees, expenses or liabilities arising from or representing such indebtedness. In this Clause 13.11(b) “fully subordinated” shall mean that any claim of the lender against the Borrower in relation to such indebtedness shall rank after and be in all respects subordinate to all of the rights and claims of the Creditor Parties under this Agreement and the other Finance Documents and that the lender shall not take any steps to enforce its rights to recover any monies owing to it by the Borrower and in particular but without

limitation the lender will not institute any legal or quasi-legal proceedings under any jurisdiction at any time against the Ship, her Earnings or Insurances or the Borrower and it will not compete with the Creditor Parties or any of them in a liquidation or other winding-up or bankruptcy of the Borrower or in any proceedings in connection with the Ship, her Earnings or Insurances.

13.12

Pooling of earnings and charters . The Borrower will not without the prior written consent of the Agent enter into in respect of the Ship, nor permit to exist at any time following the Delivery Date:

(a)	any pooling agreement or other arrangement for the sharing of any of the Earnings or the expenses of the Ship except with a member of the Group and provided that it does not adversely affect the rights of the Creditor Parties under the Finance Documents in the reasonable opinion of the Agent; or

(b)

any demise or bareboat charter, provided however that such consent shall not be unreasonably withheld in the event that the Borrower wishes to enter into a bareboat charter in a form approved by the Agent with any company which is a member of the Group on condition that if so requested by the Agent and without limitation:

(i)

any such bareboat charterer shall enter into such deeds (including but not limited to a full subordination and assignment deed in respect of its rights under the bareboat charter and its interest in the Insurances and earnings payable to it arising out of its use of the Ship), agreements and indemnities as the Agent shall in its sole discretion require prior to entering into the bareboat charter with the Borrower; and

(ii)

the Borrower shall assign the benefit of any such bareboat charter and its interest in the Insurances to the Creditor Parties by way of further security for the Borrower’s obligations under the Finance Documents; or

(c)	any charter whereunder two (2) months’ charterhire (or the equivalent thereof) is payable in advance in respect of the Ship; or

(d)	any charter of the Ship or employment which, with the exercise of options for extension, could be for a Period longer than [] ([]) months; or

(e)	any time charter of the Ship with a company outside the Group, provided however that such consent shall not be unreasonably withheld in the event that:

(i)

the Borrower agrees to execute in favour of the Creditor Parties an assignment of such time charter, the Earnings therefrom and any guarantee of the charterer’s obligations thereunder substantially in the form of the relevant provisions of the Time Charter Assignment and as required by the Agent; and

(ii)

the Agent is satisfied that the income from such time charter will be sufficient to cover the expenses of the Ship and to service repayment of the Loan and all other amounts from time to time outstanding under this Agreement.

13.13

Loans and guarantees by the Borrower . Otherwise than in the ordinary course of business in its ownership and operation of the Ship following the Delivery Date, the Borrower will not make any loan or advance or extend credit to any person, firm or corporation or issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation.

13.14

Management and employment . The Borrower will not as from the Delivery Date:

(a)	permit any person other than the Approved Manager to be the manager of, including providing crewing services to, the Ship, acting upon terms approved in writing by the Agent and having entered into:

(i)

(in the case of the Approved Manager) an Approved Manager’s Undertaking; and

(ii)

(in the case of the Borrower if the Approved Manager is not a member of the Group) an External Management Agreement Assignment;

(b)

permit any amendment to be made to the terms of any External Management Agreement unless the amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto to reflect the prevailing circumstances but provided that the amendment does not imperil the security to be provided pursuant to the Finance Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or

(c)	permit the Ship to be employed other than within the Oceania brand.

13.15

Acquisition of shares . The Borrower will not acquire any equity, share capital, assets or obligations of any corporation or other entity or permit its membership interest to be held other than directly or indirectly by Oceania Cruises.

13.16

Trading with the United States of America . The Borrower shall in respect of the Ship take all reasonable precautions as from the Delivery Date to prevent any infringements of the Anti-Drug Abuse Act of 1986 of the United States of America (as the same may be amended and/or re-enacted from time to time hereafter) or any similar legislation applicable to the Ship in any other jurisdiction in which the Ship shall trade (a “Relevant Jurisdiction”) where the Ship trades in the territorial waters of the United States of America or a Relevant Jurisdiction.

13.17

Further assurance . The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to any of the Transaction Documents or the SACE Insurance Policy or securing to the Creditor Parties the full benefit of the rights, powers and remedies conferred upon the Creditor Parties or any of them in any such Transaction Document.

13.18

Valuation of the Ship . The following shall apply in relation to the valuation of the Ship:

(a)

the Borrower will from time to time (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and remains unremedied) following the Delivery Date and within thirty (30) days of receiving any request to that effect from the Agent, procure that the Ship is valued by an independent reputable shipbroker or shipvaluer experienced in valuing cruise ships appointed by the Borrower and approved by the Agent (which approval shall not be unreasonably withheld or delayed and such valuation to be made with or without taking into account the benefit or otherwise of any fixed employment relating to the Ship as the Agent may require);

(b)	the Borrower shall procure that forthwith upon the issuance of any valuation obtained pursuant to this Clause 13.18 a copy thereof is sent directly to the Agent for review; and

(c)	in the event that the Borrower fails to procure a valuation in accordance with Clause 13.18 (a), the Agent shall be entitled to procure a valuation of the Ship on the same basis.

13.19

Earnings . The Borrower will procure that the Earnings (if any) are paid in full without set off and free and clear of and without deduction for any taxes levies duties imposts charges fees restrictions or conditions of any nature whatsoever.

13.20

Insurances . The Borrower covenants with the Creditor Parties and undertakes with effect from the Delivery Date until the end of the Security Period:

(a)

to insure the Ship in its name and keep the Ship insured on an agreed value basis for an amount in the currency in which the Loan is denominated approved by the Agent but not being less than the greater of (x) [*] per cent. ([*]%) of the amount of the Loan; and (y) the full market and commercial value of the Ship determined in accordance with Clause 13.18 from time to time through internationally recognised independent first class insurance companies, underwriters, war risks and protection and indemnity associations acceptable to the Agent in each instance on terms and conditions approved by the Agent including as to deductibles but at least in respect of:

(i)

fire and marine risks including but without limitation hull and machinery and all other risks customarily and usually covered by first-class and prudent shipowners in the London insurance markets under English marine policies or Agent-approved policies containing the ordinary conditions applicable to similar Ships;

(ii)

war risks and war risks (protection and indemnity) up to the insured amount;

(iii)

excess risks that is to say the proportion of claims for general average and salvage charges and under the running down clause not recoverable in consequence of the value at which the Ship is assessed for the purpose of such claims exceeding the insured value;

(iv)

protection and indemnity risks with full standard coverage as offered by first-class protection and indemnity associations and up to the highest limit of liability available (for oil pollution risk the highest limit currently available is one billion Dollars (USD1,000,000,000) and this to be increased if reasonably requested by the Agent and the increase is possible in accordance with the standard protection and indemnity cover for Ships of its type and is compatible with prudent insurance practice for first class cruise shipowners or operators in waters where the Ship trades from time to time from the Delivery Date until the end of the Security Period);

(v)

when and while the Ship is laid-up, in lieu of hull insurance, normal port risks; and

(vi)

such other risks as the Agent may from time to time reasonably require;

and in any event in respect of those risks and at those levels covered by first class and prudent owners and/or financiers in the international market in respect of similar tonnage provided that if any of such insurances are also effected in the name of any other person (other than the Borrower and/or a Creditor Party) such person shall if so required by the Agent execute a first priority assignment of its interest in such insurances in favour of the Creditor Parties in similar terms mutatis mutandis to the relevant provisions of the General Assignment;

(b)

that the Agent shall take out mortgagee interest insurance on such conditions as the Agent may reasonably require and mortgagee interest insurance for pollution risks as from time to time agreed each for an amount in the currency in which the Loan is denominated of [*] per cent. ([*]%) of the amount of the Loan, the Borrower having no interest or entitlement in respect of such policies; the Borrower shall upon demand of the Agent reimburse the Agent for the costs of effecting and/or maintaining any such insurance(s);

(c)	if the Ship shall trade in the United States of America and/or the Exclusive Economic Zone of the United States of America (the “ EEZ ”) as such term is defined in the US Oil Pollution Act 1990

(“ OPA ”), to comply strictly with the requirements of OPA and any similar legislation which may from time to time be enacted in any jurisdiction in which the Ship presently trades or may or will trade at any time during the existence of this Agreement and in particular before such trade is commenced and during the entire period during which such trade is carried on:

(i)

to pay any additional premiums required to maintain protection and indemnity cover for oil pollution up to the limit available to it for the Ship in the market;

(ii)

to make all such quarterly or other voyage declarations as may from time to time be required by the Ship’s protection and indemnity association and to comply with all obligations in order to maintain such cover, and promptly to deliver to the Agent copies of such declarations;

(iii)

to submit the Ship to such additional periodic, classification, structural or other surveys which may be required by the Ship’s protection and indemnity insurers to maintain cover for such trade and promptly to deliver to the Agent copies of reports made in respect of such surveys;

(iv)

to implement any recommendations contained in the reports issued following the surveys referred to in Clause 13.20(c)(iii) within the time limit specified therein and to provide evidence satisfactory to the Agent that the protection and indemnity insurers are satisfied that this has been done;

(v)

in particular strictly to comply with the requirements of any applicable law, convention, regulation, proclamation or order with regard to financial responsibility for liabilities imposed on the Borrower or the Ship with respect to pollution by any state or nation or political subdivision thereof, including but not limited to OPA, and to provide the Agent on demand with such information or evidence as it may reasonably require of such compliance;

(vi)

to procure that the protection and indemnity insurances do not contain a clause excluding the Ship from trading in waters of the United States of America and the EEZ or any other provision analogous thereto and to provide the Agent with evidence that this is so; and

(vii)

strictly to comply with any operational or structural regulations issued from time to time by any relevant authorities under OPA so that at all times the Ship falls within the provisions which limit strict liability under OPA for oil pollution;

(d)	to give notice forthwith of any assignment of its interest in the Insurances to the relevant brokers, insurance companies, underwriters and/or associations in the form approved by the Agent;

(e)

to execute and deliver all such documents and do all such things as may be necessary to confer upon the Creditor Parties legal title to the Insurances in respect of the Ship and to procure that the interest of the Creditor Parties is at all times filed with all slips, cover notes, policies and certificates of entry and to procure (a) that a loss payable clause in the form approved by the Agent shall be filed with all the hull, machinery and equipment and war risks policies in respect of the Ship and (b) that a loss payable clause in the form approved by the Agent shall be endorsed upon the protection and indemnity certificates of entry in respect of the Ship;

(f)	to procure that each of the relevant brokers and associations furnishes the Agent with a letter of undertaking in such form as may be required by the Agent and waives any lien for premiums or calls except in relation to premiums or calls solely attributable to the Ship;

(g)	punctually to pay all premiums, calls, contributions or other sums payable in respect of the Insurances on the Ship and to produce all relevant receipts when so required by the Agent;

(h)

to renew each of the Insurances on the Ship at least five (5) days before the expiry thereof and to give immediate notice to the Agent of such renewal and to procure that the relevant brokers or associations shall promptly confirm in writing to the Agent that such renewal is effected it being understood by the Borrower that any failure to renew the Insurances on the Ship at least ten (10) days before the expiry thereof or to give or procure the relevant notices of such renewal shall constitute an Event of Default;

(i)	to arrange for the execution of such guarantees as may from time to time be required by any protection and indemnity and/or war risks association;

(j)	to furnish the Agent from time to time on request with full information about all Insurances maintained on the Ship and the names of the offices, companies, underwriters, associations or clubs with which such Insurances are placed;

(k)

not to agree to any variation in the terms of any of the Insurances on the Ship without the prior approval of the Agent nor to do any act or voluntarily suffer or permit any act to be done whereby any Insurances shall or may be rendered invalid, void, voidable, suspended, defeated or unenforceable and not to suffer or permit the Ship to engage in any voyage nor to carry any cargo not permitted under any of the Insurances without first obtaining the consent of the insurers or reinsurers concerned and complying with such requirements as to payment of extra premiums or otherwise as the insurers or reinsurers may impose;

(l)	not to settle, compromise or abandon any claim in respect of any of the Insurances on the Ship other than a claim of less than [] Dollars ($[]) or the equivalent in any other currency and not being a claim arising out of a Total Loss;

(m)	to apply or ensure the appliance of all such sums receivable in respect of the Insurances on the Ship for the purpose of making good the loss and fully repairing all damage in respect whereof the insurance monies shall have been received;

(n)

that in the event of it making default in insuring and keeping insured the Ship as hereinbefore provided then the Agent may (but shall not be bound to) insure the Ship or enter the Ship in such manner and to such extent as the Agent in its discretion thinks fit and in such case all the cost of effecting and maintaining such insurance together with interest thereon at the Interest Rate shall be paid on demand by the Borrower to the Agent; and

(o)

that the Agent shall be entitled, immediately prior to the Delivery Date and thereafter no more frequently than annually on renewals but also additionally at any time when there is a proposed change of underwriters or the terms of any Insurances, to instruct independent reputable insurance advisers for the purpose of obtaining any advice or information regarding any matter concerning the Insurances which the Agent shall at its sole discretion deem necessary, it being hereby specifically agreed that the Borrower shall reimburse the Agent on demand for the costs and expenses incurred by the Agent in connection with the instruction of such advisers subject to a limit of Twenty five thousand Euro at the time of delivery of the Ship or in the event of a change of underwriters or of terms of any Insurances and otherwise Ten thousand Euro annually thereafter.

13.21

Operation and maintenance of the Ship . From the Delivery Date until the end of the Security Period at its own expense the Borrower will:

(a)

or otherwise) from time to time applicable to the Ship and shall have on board as and when required thereby valid certificates showing compliance therewith and shall procure that all repairs to or replacements of any damaged, worn or lost parts or equipment are carried out (both as regards workmanship and quality of materials) so as not to diminish the value or class of the Ship. It will not make any substantial modifications or alterations to the Ship or any part thereof which would reduce the market and commercial value of the Ship determined in accordance with Clause 13.18;

(b)	submit the Ship to continuous survey in respect of its machinery and hull and such other surveys as may be required for classification purposes and, if so required by the Agent, supply to the Agent copies in English of the survey reports;

(c)	permit surveyors or agents appointed by the Agent to board the Ship at all reasonable times to inspect its condition or satisfy themselves as to repairs proposed or already carried out and afford all proper facilities for such inspections;

(d)

comply, or procure that the Approved Manager will comply, with the ISM Code (as the same may be amended from time to time) or any replacement of the ISM Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISM Code and at all times thereafter:

(i)

hold, or procure that the Approved Manager holds, a valid Document of Compliance duly issued to the Borrower or the Approved Manager (as the case may be) pursuant to the ISM Code and a valid Safety Management Certificate duly issued to the Ship pursuant to the ISM Code;

(ii)

provide the Agent with copies of any such Document of Compliance and Safety Management Certificate as soon as the same are issued; and

(iii)

keep, or procure that there is kept, on board the Ship a copy of any such Document of Compliance and the original of any such Safety Management Certificate;

(e)

comply, or procure that the Approved Manager will comply, with the ISPS Code (as the same may be amended from time to time) or any replacement of the ISPS Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISPS Code and at all times thereafter:

(i)

keep, or procure that there is kept, on board the Ship the original of the International Ship Security Certificate required by the ISPS Code; and

(ii)

keep, or procure that there is kept, on board the Ship a copy of the ship security plan prepa.red pursuant to the ISPS Code;

(f)	comply with Annex VI (as the same may be amended from time to time) or any replacement of Annex VI (as the same may be amended from time to time) and in particular, without limitation, to:

(i)

procure that the Ship’s master and crew are familiar with, and that the Ship complies with, Annex VI; and

(ii)

maintain for the Ship throughout the Security Period a valid and current IAPPC and provide a copy to the Agent; and

(iii)

notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the IAPPC;

(g)

not employ the Ship or permit its employment in any trade or business which is forbidden by any applicable law or is otherwise illicit or in carrying illicit or prohibited goods or in any manner whatsoever which may render it liable to condemnation in a prize court or to destruction, seizure or confiscation or that may expose the Ship to penalties. In the event of hostilities in any part of the world (whether war be declared or not) it will not employ the Ship or permit its employment in carrying any contraband goods;

(h)

promptly provide the Agent with (i) all information which the Agent may reasonably require regarding the Ship, its employment, earnings, position and engagements (ii) particulars of all towages and salvages and (iii) copies of all charters and other contracts for its employment and otherwise concerning it;

(i)	give notice to the Agent promptly and in reasonable detail upon the Borrower or any other Obligor becoming aware of:

(i)

accidents to the Ship involving repairs the cost of which will or is likely to exceed [*] Dollars ($[*]);

(ii)

the Ship becoming or being likely to become a Total Loss;

(iii)

any recommendation or requirement made by any insurer or classification society or by any competent authority which is not complied with, or cannot be complied with, within any time limit relating thereto and that might reasonably affect the maintenance of either the Insurances or the classification of the Ship;

(iv)

any writ or claim served against or any arrest of the Ship or the exercise of any lien or purported lien on the Ship, her Earnings or Insurances;

(v)

the Ship ceasing to be registered under the flag of the Maritime Registry or anything which is done or not done whereby such registration may be imperilled;

(vi)

it becoming impossible or unlawful for it to fulfil any of its obligations under the Finance Documents; and

(vii)

anything done or permitted or not done in respect of the Ship by any person which is likely to imperil the security created by the Finance Documents;

(j)

promptly pay and discharge all debts, damages and liabilities, taxes, assessments, charges, fines, penalties, tolls, dues and other outgoings in respect of the Ship and keep proper books of account in respect thereof, provided always that the Borrower shall not be obliged to compromise any debts, damages and liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested debt, damage or liability which, either individually or in aggregate exceeds [*] Dollars ($[*]) shall forthwith be provided to the Agent. As and when the Agent may so require the Borrower will make such books available for inspection on behalf of the Agent and provide evidence satisfactory to the Agent that the wages and allotments and the insurance and pension contributions of the master and crew are being regularly paid, that all deductions of crew’s wages in respect of any tax liability are being properly accounted for and that the master has no claim for disbursements other than those incurred in the ordinary course of trading on the voyage then in progress or completed prior to such inspection;

(k)

maintain the type of the Ship as at the Delivery Date and not put the Ship into the possession of any person for the purpose of work being done on it in an amount exceeding or likely to exceed [*] Dollars ($[*]) unless such person shall first have given to the Agent a written undertaking addressed to the Agent in terms satisfactory to the Agent agreeing not to exercise a lien on the Ship or her Earnings for the cost of such work or for any other reason;

(l)

promptly pay and discharge all liabilities which have given rise, or may give rise, to liens or claims enforceable against the Ship under the laws of all countries to whose jurisdiction the Ship may from time to time be subject and in particular the Borrower hereby agrees to indemnify and hold the Creditor Parties, their successors, assigns, directors, officers, shareholders, employees and agents harmless from and against any and all claims, losses, liabilities, damages, expenses (including attorneys’ fees and expenses and consultant fees) and injuries of any kind whatsoever asserted against the Creditor Parties, with respect to or as a result of the presence, escape, seepage, spillage, release, leaking, discharge or migration from the Ship or other properties owned or operated by the Borrower of any hazardous substance, including without limitation, any claims asserted or arising under any applicable environmental, health and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder of all governmental agencies, regardless of whether or not caused by or within the control of the Borrower subject to the following:

(i)

it is the parties’ understanding that the Creditor Parties do not now, have never and do not intend in the future to exercise any operational control or maintenance over the Ship or any other properties and operations owned or operated by the Borrower, nor in the past, presently, or intend in the future to, maintain an ownership interest in the Ship or any other properties owned or operated by the Borrower except as may arise upon enforcement of the Lenders’ rights under the Mortgage;

(ii)

unless and until an Event of Default shall have occurred and without prejudice to the right of each Lender to be indemnified pursuant to this Clause 13.21(l):

(A)

each Lender will, if it is reasonably practicable to do so, notify the Borrower upon receiving a claim in respect of which the relevant Lender is or may become entitled to an indemnity under this Clause 13.21(l); and

(B)

subject to the prior written approval of the relevant Lender which the Lender shall have the right to withhold, the Borrower will be entitled to take, in the name of the relevant Lender, such action as the Borrower may see fit to avoid, dispute, resist, appeal, compromise or defend any such claims, losses, liabilities, damages, expenses and injuries as are referred to above in this Clause 13.12(l) or to recover the same from any third party, subject to the Borrower first ensuring that the relevant Lender is secured to its reasonable satisfaction against all expenses thereby incurred or to be incurred;

provided always that the Borrower shall not be obliged to compromise any liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested liabilities which, either individually or in aggregate, exceed [*] Dollars ($[*]) shall be forthwith provided to the Agent. If the Ship is arrested or detained for any reason it will procure its immediate release by providing bail or taking such other steps as the circumstances may require;

(m)

give to the Agent at such times as it may from time to time reasonably require a certificate, duly signed on its behalf, as to the total amount of any debts, damages and liabilities relating to the Ship and details of such of those debts, damages and liabilities as are over a certain amount to be specified by the Agent at the relevant time and, if so required by the Agent, forthwith discharge such of those debts, damages and liabilities as the Agent shall require other than those being contested in good faith; and

(n)	maintain the registration of the Ship under and fly the flag of the Maritime Registry and not do or permit anything to be done whereby such registration may be forfeited or imperilled.

13.22

Irrevocable payment instructions . The Borrower shall not modify, revoke or withhold the payment instructions set out in Clause 4.1 without the agreement of the Builder (in the case of Clause 4.1(a) only), the Agent and the Lenders.

13.23

“Know your customer” checks . If:

(a)	the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;

(b)	any change in the status of a Borrower after the date of this Agreement; or

(c)	a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer,

obliges the Agent or any Lender (or, in the case of Clause 13.23(c), 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, the Borrower 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 Clause 13.23(c), on behalf of any prospective new Lender) in order for the Agent and, such Lender or 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.

13.24

Shipbuilding Contract . The Borrower shall not modify the Shipbuilding Contract, directly or indirectly, if, by reason of regulations which apply to a Lender, such modification would make such Lender’s Commitment impossible to fulfil or would change the substance or form of its Commitment. The Borrower will, therefore, submit to the Agent any proposals for modification which, in its opinion, might have such a consequence, and the Agent on behalf of the Lenders will indicate in a timely manner whether the modification proposed will allow the Loan to be maintained. On or about the last day of each successive period of three (3) months commencing on the date of this Agreement and on the date of the Drawdown Notice, the Borrower undertakes to provide the Agent with a copy of any Change Order entered into during that three (3) month or other period. The Borrower also undertakes to notify the Agent of any change in the Intended Delivery Date as soon as practicable after each change has occurred.

13.25

FOREX Contracts . The Borrower shall:

(a)	provide the Agent with a copy of all FOREX Contracts together with all relevant details with ten (10) days of their execution; and

(b)	inform the Agent, when requested by the Agent, of its intended hedging policy for purchasing Euro with Dollars.

14	SECURITY VALUE MAINTENANCE

14.1

Security Shortfall . If, upon receipt of a valuation of the Ship in accordance with Clause 13.18, the Security Value shall be less than the Security Requirement, the Agent may give notice to the Borrower requiring that such deficiency be remedied and then the Borrower shall (unless the Ship has become a Total Loss) either:

(a)

prepay within a period of 30 days of the date of receipt by the Borrower of the Agent’s said notice such sum in Dollars as will result in the Security Requirement after such repayment (taking into account any other repayment of the Loan made between the date of the notice and the date of such prepayment) being equal to the Security Value; or

(b)

within 30 days of the date of receipt by the Borrower of the Agent’s said notice constitute to the reasonable satisfaction of the Agent such further security for the Loan as shall be reasonably acceptable to the Agent having a value for security purposes (as determined by the Agent in its absolute discretion) at the date upon which such further security shall be constituted which, when added to the Security Value, shall not be less than the Security Requirement as at such date.

Clauses 14.2 and 14.4 shall apply to prepayments under Clause 14.1(a).

14.2

Costs . All costs in connection with the Agent obtaining any valuation of the Ship referred to in Clause 13.18, and obtaining any valuation either of any additional security for the purposes of ascertaining the Security Value at any time or necessitated by the Borrower electing to constitute additional security pursuant to Clause 14.1 (b) shall be borne by the Borrower.

14.3

Valuation of additional security . For the purpose of this Clause 14, the market value of any additional security provided or to be provided to the Agent shall be determined by the Agent in its absolute discretion without any necessity for the Agent assigning any reason thereto.

14.4

Documents and evidence . In connection with any additional security provided in accordance with this Clause 14, the Agent shall be entitled to receive such evidence and documents of the kind referred to in Clause 3 in respect of other Finance Documents as may in the Agent’s opinion be appropriate.

14.5

Cash or a letter of credit as additional security . For all purposes under this Clause 14, it is agreed and understood that:

(a)	cash or a letter of credit shall be an acceptable form of security provided that in the case of a letter of credit it is issued on such terms and by such first class bank as shall have been approved in writing by the Agent (acting in its reasonable discretion); and

(b)	the value of such cash for security purposes shall be equal to the amount of such cash and the value of such letter of credit for security purposes shall be equal to its stated amount.

15	LETTER OF CREDIT PROVISIONS

15.1

Letter of Credit Option . The Borrower shall have the option of procuring the issue and Delivery to the Agent (acting on behalf of the Lenders) by the Letter of Credit Issuer of the Letter of Credit (thereby avoiding a reduction in the Eligible Amount as a result of the Letter of Credit not being issued), such option to be exercised by fulfilling the following conditions:

(a)	the Letter of Credit shall be delivered to the Agent not later than the Letter of Credit Issue Date; and

(b)

unless the Letter of Credit has been issued to the Agent, acting on behalf of the Lenders, in the form of an MT 760 SWIFT message, a Certified Copy of an extract from the relevant corporate documentation of the Letter of Credit Issuer evidencing the signing provisions of the Letter of Credit Issuer together with a certificate of a competent officer of the Letter of Credit Issuer containing specimen signatures of the persons authorised to sign the Letter of Credit on behalf of the Letter of Credit Issuer shall be delivered to the Agent simultaneously with the Letter of Credit.

15.2

Drawings under Letter of Credit . The Agent shall be entitled to demand payment under the Letter of Credit (if issued pursuant to Clause 15.1) by delivering to the Letter of Credit Issuer in accordance with the provisions of the Letter of Credit:

(a)	a drawing certificate substantially in the form of Exhibit A to the Letter of Credit following the occurrence of an Event of Default; and

(b)

a drawing certificate substantially in the form of Exhibit B to the Letter of Credit in the event that the Letter of Credit Issuer notifies the Agent in accordance with the provisions of the Letter of Credit that it has elected not to extend the expiration date of the Letter of Credit (as from time to time renewed) at any time during the Security Period.

15.3

Application of drawings under Letter of Credit . All sums received by the Agent in respect of a drawing under the Letter of Credit (if issued pursuant to Clause 15.1) shall:

(a)	in the case of a drawing in the circumstances described in Clause 15.2(a), be applied by the Agent in accordance with Clause 19; or

(b)

in the case of a drawing in the circumstances described in Clause 15.2 (b), be applied by the Agent in accordance with Clause 19 unless the Agent, acting with the authority of the Majority Lenders, agrees that such sums may be deposited into a cash collateral account pledged by the Borrower in favour of the Agent on terms reasonably acceptable to the Agent.

15.4

Release Certificate . The Agent undertakes with the Borrower to cause the Letter of Credit (if issued pursuant to Clause 15.1) to be entirely cancelled promptly upon the occurrence of any event specified in paragraphs (a), (b), (c), (d) or (e) below (each a “Letter of Credit Release Event”):

(a)	all indebtedness incurred under this Agreement has been repaid and/or paid in full; or

(b)	an amount equal to the stated amount of the Letter of Credit has been deposited into a cash collateral account pledged by an Obligor in favour of the Agent on terms reasonably acceptable to the Agent; or

(c)	pursuant to the sale of Prestige Holdings or one of more of its subsidiaries, the Agent has received a replacement letter of credit or other security on terms reasonably acceptable to the Agent; or

(d)

if (i) the Other Ship has been delivered, (ii) the indebtedness of Oceania Cruises in respect of its “R Series” ships has either been repaid in full or replaced on terms reasonably acceptable to the Agent, (iii) both Guarantors are in compliance with the financial covenants under their respective Guarantees for their current financial year as at the end of the most recently completed financial quarter of both Guarantors and (iv) to the extent this paragraph (d) is being invoked prior to 24 months following delivery of the Other Ship, both Guarantors shall, at the end of their most recent financial quarter, have a total debt to trailing 12-month EBITDA ratio of 3.5:1 or less and a total debt to total equity ratio of 2.5:1 or less (based on the definitions set forth in the Prestige Holdings Guarantee); or

(e)	this Agreement has been terminated for any reason prior to the Delivery Date.

16	CANCELLATION AND PREPAYMENT

16.1

Cancellation . At any time prior to the delivery of a Drawdown Notice and not less than ninety (90) Business Days prior to the Intended Delivery Date, the Borrower may give notice to the Agent in writing that it wishes to cancel the Total Commitments in their entirety whereupon (without penalty to the Borrower but without prejudice to any liabilities of the Borrower including, without limitation, in respect of fees payable or accrued under this Agreement, arising prior to the date of such cancellation) the Total Commitments shall terminate upon the date specified in such notice.

16.2

Voluntary prepayment . The Borrower may prepay all or part of the Loan (but if in part being an amount that reduces the Loan by a minimum amount of one (1) repayment instalment of principal of the Loan) together with interest thereon without penalty provided the prepayment is made on the last day of an Interest Period and three (3) month’s prior written notice indicating the intended date of prepayment is given to the Agent and the SACE Agent, but the following amounts shall be payable to the Agent for the account of the Lenders or the Italian Authorities in the sum of:

(a)

if the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b), the difference (if positive), calculated by the Lenders and notified by them to the Agent, between the actual cost for the Lenders of the funding for the Loan and the rate of interest for the monies to be invested by the Lenders, applied to the amounts so prepaid for the Period from the said prepayment until the last day of the Interest Period during which the prepayment occurs (if prepayment does not occur on the last day of that Interest Period), details of any such calculation being supplied to the Borrower by the Agent on behalf of the Lenders; or

(b)	if the Borrower has selected the Fixed Interest Rate pursuant to Clause 3.5(b), the charges (if any) imposed on the Lenders by the Italian Authorities representing funding or breakage costs of the Italian Authorities.

16.3

Mandatory prepayment . The Borrower shall be obliged to prepay the whole of the Loan if:

(a)	the Ship is sold or becomes a Total Loss:

(i)

in the case of a sale, on or before the date on which the sale is completed by Delivery of the Ship to the buyer; or

(ii)

in the case of a Total Loss, on the earlier of the date falling 120 days after the Total Loss Date and the date of receipt by the Agent of the proceeds of insurance relating to such Total Loss; or

(b)	the SACE Insurance Policy is modified, suspended, terminated or rescinded unless caused by the wilful misconduct or gross negligence of a Creditor Party.

16.4

Other amounts . Any prepayment of the whole of the Loan shall be made together with all other sums due under this Agreement (including, without limitation, the compensation calculated in accordance with Clause 16.2).

16.5

Application of partial prepayment . Amounts prepaid shall be applied in accordance with Clause 19.1(b).

16.6

No reborrowing . Amounts prepaid may not be reborrowed.

17	INTEREST ON LATE PAYMENTS

17.1

Default rate of interest . Without prejudice to the provisions of Clause 18 and without this Clause in any way constituting a waiver of terms of payment, all sums due by the Borrower under this Agreement will automatically bear interest on a day to day basis from the date when they are payable until the date of actual payment at a rate per annum equal to the higher of:

(a)	where the Floating Interest Rate is applicable, the aggregate of:

(i)

Overnight LIBOR;

(ii)

the Margin; and

(iii)

[*] per cent. ([*]%) per annum; or

(b)	where the Fixed Interest Rate is applicable, the higher of:

(i)

the CIRR plus [*] per cent. ([*]%) per annum; and

(ii)

Overnight LIBOR plus the Margin plus [*] per cent. ([*]%) per annum.

17.2

Compounding of default interest . Any such interest will itself bear interest at the above rate if it is due for at least three (3) months and thereafter at three monthly intervals.

18	EVENTS OF DEFAULT

18.1

Events of Default . An Event of Default occurs if any of the events or circumstances described in Clause 18.2 to 18.21 occur provided that if, at any time during the period commencing on the day after the date of this Agreement and ending on the date falling ninety (90) days before the Intended Delivery Date (the “Restriction Period”), an event should occur that would constitute an Event of Default, the Agent shall not be entitled to serve any notice under Clause 18.22 (a) during the Restriction Period unless the relevant event consists of:

(a)	a failure by the Borrower to comply with the provisions of Clauses 13.5, 13.6, 13.8 or 13.13;

(b)	the happening of any of the events specified in Clauses 18.2, 18.7, 18.8, 18.9, 18.10, 18.11, 18.12 or 18.13;

(c)	the repudiation or termination of the Shipbuilding Contract.

However, this provision shall not be interpreted as a waiver of:

(i)

the Agent’s right to serve any notice under Clause 18.22 (a) in respect of any Event of Default that has occurred and that remains unremedied on the last day of the Restriction Period; or

(ii)

the obligation of any Obligor under any Finance Document prior to the last day of the Restriction Period including (without limitation) the punctual delivery to the Agent of any information which the Agent is entitled to receive under the provisions of any Finance Document and the prompt notification to the Agent of the occurrence of any Event of Default whether or not the Agent is entitled to serve any notice under Clause 18.22 (a).

18.2

Non-payment . Any Obligor fails to pay when due or (if so payable) on demand any sum payable under a Finance Document or under any document relating to a Finance Document and such failure is not remedied within three (3) Business Days of the due date or (if payable on demand) within three (3) Business Days of receiving the demand.

18.3

Non-remediable breaches . The Borrower fails to comply with the provisions of Clauses 13.5, 13.6, 13.8 or 13.13.

18.4

Breach of other obligations .

(a)

Any Obligor fails to comply with any provision of any Finance Document (other than a failure to comply covered by any of the other provisions of Clauses 18.2 to 18.21) and in particular but without limitation either of the Guarantors fails to comply with the provisions of Clause 11 (Undertakings) of its Guarantee or there is any breach in the sole opinion of the Agent of any of the Underlying Documents provided that no Event of Default shall be deemed to have occurred if, in the opinion of the Agent in its sole discretion, such failure or breach is capable of remedy and is remedied within the Relevant Period (as defined below) from the date of its occurrence, if the

failure was known to that Obligor, or from the date the relevant Obligor is notified by the Agent of the failure, if the failure was not known to that Obligor, unless in any such case as aforesaid the Agent in its sole discretion considers that the failure or breach is or could reasonably be expected to become materially prejudicial to the interests, rights or position of the Lenders, “ Relevant Period ” meaning for the purposes of this Clause thirty (30) days in respect of a remedy period commencing under this Clause not later than 30 September 2009 and fifteen (15) days in respect of a remedy period commencing after 30 September 2009; or

(b)	If there is a repudiation or termination of any Transaction Document or if any of the panics thereto becomes entitled to terminate or repudiate any of them and evidences an intention so to do.

18.5

Misrepresentation . Any representation, warranty or statement made or repeated in, or in connection with, any Transaction Document or the SACE Insurance Policy or in any accounts, certificate, statement or opinion delivered by or on behalf of any Obligor thereunder or in connection therewith is materially incorrect or misleading when made or would, if repeated at any time hereafter by reference to the facts subsisting at such time, no longer be materially correct.

18.6

Cross default .

(a)	Any event of default occurs under any financial contract or financial document relating to any Financial Indebtedness of the Borrower; or

(b)	any such Financial Indebtedness or any sum payable in respect thereof is not paid when due (after the expiry of any applicable grace period(s)) whether by acceleration or otherwise; or

(c)

any other Financial Indebtedness of any member of the Group is not paid when due or is or becomes capable of being declared due prematurely by reason of default or any Security Interest securing the same becomes enforceable by reason of default provided that no Event of Default will arise if the aggregate amount of the relevant Financial Indebtedness and liabilities secured by the relevant Security Interests is less than $[*] or its equivalent in other currencies; and

(d)

any other Security Interest over any assets of any member of the Group securing any alleged liability that does not qualify as Financial Indebtedness becomes enforceable where the alleged liability is in respect of a sum of, or sum aggregating, $[*] or its equivalent in other currencies, unless the alleged liability is being contested in good faith by appropriate means by the relevant Group member and the Agent is reasonably satisfied that the relevant member of the Group has reasonable grounds for succeeding in its action.

18.7

Winding-up . Any order is made or an effective resolution passed or other action taken for the suspension of payments or reorganisation, dissolution, termination of existence, liquidation, winding-up or bankruptcy of any Obligor.

18.8

Moratorium or arrangement with creditors . A moratorium in respect of all or any debts of any Obligor or a composition or an arrangement with creditors of any Obligor or any similar proceeding or arrangement by which the assets of any Obligor are submitted to the control of its creditors is applied for, ordered or declared or any Obligor commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of all or a significant part of its Financial Indebtedness.

18.9

Appointment of liquidators etc . A liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer is appointed in respect of any Obligor or in respect of all or any substantial part of the assets of any Obligor.

18.10

Insolvency . Any Obligor becomes or is declared insolvent or is unable, or admits in writing its inability, to pay its debts as they fall due or becomes insolvent within the terms of any applicable law.

18.11

Legal process . Any distress, execution, attachment or other process affects the whole or any substantial part of the assets of any Obligor and remains undischarged for a period of thirty (30) days or any uninsured judgment in excess of [*] Dollars ($[*]) following final appeal remains unsatisfied for a period of ten (10) days.

18.12

Analogous events . Anything analogous to or having a substantially similar effect to any of the events specified in Clauses 18.7 to 18.11 shall occur under the laws of any applicable jurisdiction.

18.13

Cessation of business . Any Obligor ceases to carry on all or a substantial part of its business.

18.14

Revocation of consents . Any authorisation, approval, consent, licence, exemption, filing, registration or notarisation or other requirement necessary to enable any Obligor to comply with any of its obligations under any of the Transaction Documents is materially adversely modified, revoked or withheld or does not remain in full force and effect and within ninety (90) days of the date of its occurrence such event is not remedied to the satisfaction of the Agent and the Agent considers in its sole discretion that such failure is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the modification, revocation or withholding of the authorisation, approval or consent is due to an act or omission of any Obligor and the Agent is satisfied in its sole discretion that the Lenders’ interests might reasonably be expected to be materially adversely affected.

18.15

Unlawfulness . At any time it is unlawful or impossible for any Obligor to perform any of its material (to the Creditor Parties or any of them) obligations under any Transaction Document to which it is a party or it is unlawful or impossible for the Creditor Parties or any Lender to exercise any of their or its rights under any of the Transaction Documents provided that no Event of Default shall be deemed to have occurred where the unlawfulness or impossibility does not relate to the payment obligation of any Obligor under any Transaction Document and is cured within the period of twenty one (21) days of the date of occurrence of the event giving rise to the unlawfulness or impossibility and the affected Obligor performs it obligation within such period.

18.16

Insurances . The Borrower fails to insure the Ship in the manner specified in Clause 13.20 or fails to renew the Insurances at least five (5) days prior to the date of expiry thereof and produce prompt confirmation of such renewal to the Agent provided that if the insurers withdraw their cover an Event of Default shall be deemed to have occurred upon issue of the insurer’s notice of withdrawal.

18.17

Disposals . If the Borrower or any other Obligor shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor with the intention of preferring such creditor over any other creditor.

18.18

Prejudice to security . Anything is done or suffered or omitted to be done by any Obligor which in the reasonable opinion of the Agent would or might be expected to imperil the security created by any of the Finance Documents.

18.19

Governmental intervention . The authority of any Obligor in the conduct of its business is wholly or substantially curtailed by any seizure or intervention by or on behalf of any authority and within ninety (90) days of the date of its occurrence any such seizure or intervention is not

relinquished or withdrawn and the Agent reasonably considers that the relevant occurrence is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the seizure or intervention executed by any authority is due to an act or omission of any Obligor and the Agent is satisfied, in its sole discretion, that the Lenders’ interest might reasonably be expected to be materially adversely affected.

18.20

Letter of Credit . There shall occur a Letter of Credit Event of Default.

18.21

Other Loan Agreement . There shall occur an Event of Default (under and as defined in the Other Loan Agreement).

18.22

Actions following an Event of Default . On, or at any time after, the occurrence of an Event of Default the Agent may, and if so instructed by the Majority Lenders, the Agent shall:

(a)	serve on the Borrower a notice stating that the Commitments and all other obligations of each Lender to the Borrower under this Agreement are terminated; and/or

(b)

serve on the Borrower a notice stating that the Loan (including but without limitation the amount representing the financed second instalment of the SACE Premium), 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

(c)	take any other action which, as a result of the Event of Default or any notice served under paragraph (a) or (b), the Agent and/or the Lenders are entitled to take under any Finance Document or any applicable law including (without limitation) making a call under the Letter of Credit.

18.23

Termination of Commitments . On the service of a notice under Clause 18.22(a), the Commitments and all other obligations of each Lender to the Borrower under this Agreement shall terminate.

18.24

Acceleration of Loan . On the service of a notice under Clause 18.22(b), the Loan, all accrued interest and all other amounts accrued or owing from the Borrower or any Obligor under this Agreement and every other Finance Document shall become immediately due and payable or, as the case may be, payable on demand.

18.25

Further amounts payable . Upon an acceleration of repayment of the Loan following an Event of Default the Borrower shall be liable to pay compensation calculated in accordance with Clause 16.2.

18.26

Multiple notices, action without notice . The Agent may serve notices under Clauses 18.22(a) and (b) simultaneously or on different dates and it may take any action referred to in Clause 18.22(c) if no such notice is served or simultaneously with or at anytime after the service of both or either of such notices.

18.27

Notification of Creditor Parties and Obligors . The Agent shall send to each Lender and each Obligor a copy or the text of any notice which the Agent serves on the Borrower under Clause 18.22; but the notice shall become effective when it is served on the Borrower, 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 Obligor with any form of claim or defence.

18.28

Lender’s rights unimpaired . Nothing in this Clause 18 shall be taken to impair or restrict the exercise of any right given to individual Lenders under a Finance Document or the general law, and, in particular, this Clause is without prejudice to Clauses 2.4 and 2.5.

18.29

Exclusion of Creditor Party liability . No Creditor Party, and no receiver or manager appointed by the Agent, shall have any liability to an Obligor:

(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.

19	APPLICATION OF SUMS RECEIVED

19.1

Receipts . Except as any Finance Document may otherwise provide, all sums received under this Agreement or any other Finance Document by the Agent, on behalf of the Lenders, or by any of the Lenders for any reason whatsoever will be applied:

(a)

in priority, to payments of any kind due or in arrears in the order of their due payment dates and first, to fees, charges and expenses, second, to interest payable pursuant to Clause 17, third, to interest payable pursuant to Clause 6, fourth, to the principal of the Loan payable pursuant to Clause 5 and, fifth, to any other sums due under this Agreement or any other Finance Document and, if relevant, pro rata to each of the Lenders; or

(b)

if no payments are in arrears or if these payments have been discharged as set out above, then and to sums remaining due under this Agreement or any other Finance Document and, if relevant, pro rata to each of the Lenders and in each case in inverse order of maturity, the interest being recalculated accordingly.

20	INDEMNITIES

20.1

Indemnities regarding borrowing and repayment of Loan . The Borrower shall fully indemnify the Agent and each Lender on the Agent’s 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)	the Loan 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 Borrower 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 Borrower on the amount concerned under Clause 17);

(d)	the occurrence and/or continuance of an Event of Default and/or the acceleration of repayment of the Loan under Clause 18;

and in respect of any Tax (other than Tax on its overall net income) 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 covers (i) any claim, expense, liability or loss, including a loss of a prospective profit, incurred by a Lender 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 (ii) if the Borrower has selected the Fixed Interest Rate in accordance with Clause 3.5(b), any funding or breakage costs imposed by SIMEST as a consequence of (x) any total or partial prepayment of the Loan and/or (y) the Borrower deciding to switch from the Fixed Interest Rate to another interest rate after the Drawdown Date and/or (z) the Interest Make-up Agreement ceasing for any reason to be in effect; any such costs imposed by SIMEST shall be paid by the Borrowers to SIMEST through the Agent.

20.3

Miscellaneous indemnities . The Borrower 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 or any other Creditor Party or by any receiver appointed under a Finance Document;

(b)	any other Pertinent Matter,

other than claims, expenses, liabilities and losses which are shown to have been directly and mainly caused by the dishonesty or wilful misconduct of the officers or employees of the Creditor Party concerned.

Without prejudice to its generality, this Clause 20.3 covers any claims, expenses, liabilities and losses which arise, or are asserted, under or in connection with any law relating to safety at sea, the ISM Code or any Environmental Laws.

20.4

Currency indemnity . If any sum due from an Obligor 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 an Obligor, 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 Borrower shall indemnify the Creditor Party concerned against the loss arising when the amount of the payment actually received by that Creditor Party is convened at the available rate of exchange into the Contractual Currency.

In this Clause 20.4 the “available rate of exchange” means the rate at which the Creditor Party concerned is able at the opening of business (Paris time) on the Business Day after it receives the sum concerned to purchase the Contractual Currency with the Payment Currency.

This Clause 20.4 creates a separate liability of the Borrower which is distinct from its other liabilities under the Finance Documents and which shall not be merged in any judgment or order relating to those other liabilities.

20.5

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 20 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.

20.6

Sums deemed due to a Lender . For the purposes of this Clause 20, a sum payable by the Borrower to the Agent for distribution to a Lender shall be treated as a sum due to that Lender.

21	ILLEGALITY, ETC

21.1

Illegality . This Clause 21 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,

for the Notifying Lender to maintain or give effect to any of its obligations under this Agreement in the manner contemplated by this Agreement.

21.2

Notification of illegality . The Agent shall promptly notify the Borrower, the Obligors and the other Lenders of the notice under Clause 21.1 which the Agent receives from the Notifying Lender.

21.3

Prepayment; termination of Commitment . On the Agent notifying the Borrower under Clause 21.2, the Notifying Lender’s Commitment shall terminate; and thereupon or, if later, on the date specified in the Notifying Lender’s notice under Clause 21.1 as the date on which the notified event would become effective the Borrower shall prepay the Notifying Lender’s Contribution and shall pay compensation to the Notifying Lender calculated in accordance with Clause 16.2.

22	SET-OFF

22.1

Application of credit balances . Each Creditor Party may 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 the Borrower at any office in any country of that Creditor Party in or towards satisfaction of any sum then due from the 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 the Borrower;

(ii)

convert or translate all or any part of a deposit or other credit balance into Dollars;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

22.2

Existing rights unaffected . No Creditor Party shall be obliged to exercise any of its rights under Clause 22.1; 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).

22.3

Sums deemed due to a Lender . For the purposes of this Clause 22, a sum payable by the Borrower to the Agent 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.

22.4

No Security Interest . This Clause 22 gives the Creditor Parties a contractual right of setoff only, and does not create any equitable charge or other Security Interest over any credit balance of the Borrower.

23	CHANGES TO THE LENDERS

23.1

Assignments and transfers by the Lenders . Subject to this Clause 23 and the prior written consent of the Italian Authorities having been obtained, a Lender (the “Existing Lender”) may:

(a)	assign its rights; or

(b)	transfer by novation its rights and obligations,

to another bank or financial institution (the “ New Lender ”).

23.2

Conditions of assignment or transfer .

(a)	The consent of the Borrower is required for an assignment or transfer by an Existing Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender.

(b)	The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed.

(c)	The assignment or transfer must be with respect to a minimum Commitment of [] Dollars ($[]) or, if less, the Existing Lender’s full Commitment.

(d)	An assignment will only be effective on:

(i)

receipt by the Agent of written confirmation from the New Lender (in form and substance satisfactory to the Agent) that the New Lender will assume the same obligations to the other Creditor Parties as it would have been under if it was an Original Lender; and

(ii)

performance by the Agent of all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender.

23.3

Assignment or transfer fee . The New Lender shall:

(a)	on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of [] Euro (EUR[]);

(b)

pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation legal costs and out of pocket expenses, incurred by the Agent or the Lenders in connection with any necessary amendment to or supplementing of the Transaction Documents or any of them or the SACE Insurance Policy as a consequence of the assignment or transfer; and

(c)	pay to the Agent, upon demand, such amount as is payable to the Italian Authorities to cover its costs of giving its approval under Clause 23.1.

23.4

Limitation of responsibility of Existing Lenders .

(a)	Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:

(i)

the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents or any other documents;

(ii)

the financial condition of any Obligor;

(iii)

the performance and observance by any Obligor of its obligations under the Finance Documents or any other documents; or

(iv)

the accuracy of any statements (whether written or oral) made in or in connection with any Finance Document or any other document,

and any representations or warranties implied by law are excluded.

(b)	Each New Lender confirms to the Existing Lender and the other Creditor Parties that it:

(i)

has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Finance Document; and

(ii)

will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities whilst any amount is or may be outstanding under the Finance Documents or any Commitment is in force.

(c)	Nothing in any Finance Document obliges an Existing Lender to:

(i)

accept a re-transfer from a New Lender of any of the rights and obligations assigned or transferred under this Clause 23; or

(ii)

support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Finance Documents or otherwise.

23.5

Permitted disclosure . Any Creditor Party may disclose to any of its Affiliates and to the following other persons:

(a)	any person to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement;

(b)	any person with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or any Obligor;

(c)	any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;

(d)	any other Creditor Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;

(e)	or any employee, officer, director or representative of any Italian Authorities which needs to know such information or receive such document in the course of such person’s employ or duties;

(f)	a Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or

(g)	auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information,

any information about any Obligor, this Agreement and the other Finance Documents as that Creditor Party shall consider appropriate. Each of the Creditor Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Agreement and the other Finance Documents as that Creditor Party reasonably considers normal practice for an export credit.

23.6

Assignment or transfer to SACE . Notwithstanding the above provisions of this Clause 23:

(a)

each Lender and the Agent shall, if so instructed by SACE in accordance with the provisions of the SACE Insurance Policy and without any requirement for the consent of the Borrower, assign its rights or (as the case may be) transfer its rights and obligations to SACE, which assignment or transfer shall take effect upon the date stated in the relevant documentation; and

(b)

the Agent shall promptly notify the Borrower of any such assignment or transfer to SACE and the Borrower shall pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation legal costs and out of pocket expenses, incurred by the Agent or the Lenders in connection with any such assignment or transfer.

24	CHANGES TO THE OBLIGORS

24.1

No change without consent . No Obligor may assign any of its rights or transfer any of its rights or obligations under the Finance Documents.

25	ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS

25.1

Appointment of the Agent .

(a)	Each other Creditor Party appoints the Agent to act as its agent under and in connection with this Agreement and the other Finance Documents and the SACE Insurance Policy.

(b)	Each other Creditor Party authorises the Agent 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.

25.2

Duties of the Agent .

(a)	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.

(b)	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.

(c)	If the Agent receives notice from a Party referring to this Agreement, describing an Event of Default and stating that the circumstance described is an Event of Default, it shall promptly notify the other Creditor Parties.

(d)	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 or a Mandated Lead Arranger) under this Agreement it shall promptly notify the other Creditor Parties.

(e)	The Agent’s duties under the Finance Documents are solely administrative in nature.

25.3

Role of the Mandated Lead Arrangers . None of the Mandated Lead Arrangers has any obligations of any kind to any other Party under or in connection with any Transaction Document or the SACE Insurance Policy.

25.4

No fiduciary duties .

(a)	Nothing in this Agreement constitutes the Agent or any of the Mandated Lead Arrangers as a trustee or fiduciary of any other person.

(b)	Neither the Agent nor any of the Mandated Lead Arrangers shall be bound to account to any Lender for any sum or the profit element of any sum received by it for its own account.

25.5

Business with the Guarantors . The Agent and each of the Mandated Lead Arrangers may accept deposits from, lend money to and generally engage in any kind of banking or other business with any Affiliate or subsidiary of the Guarantors.

25.6

Rights and discretions of the Agent .

(a)	The Agent may rely on:

(i)

any representation, notice or document believed by it to be genuine, correct and appropriately authorised; and

(ii)

any statement made by a director, authorised signatory or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify.

(b)	The Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Lenders) that:

(i)

no Event of Default has occurred (unless it has actual knowledge of an Event of Default); and

(ii)

any right, power, authority or discretion vested in any Party or the Lenders has not been exercised.

(c)	The Agent may engage, pay for and rely on the advice or services of any lawyers, accountants, surveyors or other experts.

(d)	The Agent may act in relation to the Finance Documents through its personnel and agents.

(e)	The Agent may disclose to any other Party any information it reasonably believes it has received as the Agent under this Agreement.

(f)

Notwithstanding any other provision of any Finance Document to the contrary, neither the Agent nor any of the Mandated Lead Arrangers is obliged to do or omit to do anything if it would or might in its reasonable opinion constitute a breach of any law or regulation or a breach of a fiduciary duty or duty of confidentiality.

25.7

Lenders’ instructions .

(a)	Unless a contrary indication appears in a Finance Document, the Agent shall:

(i)

exercise any right, power, authority or discretion vested in it as Agent in accordance with any instructions given to it by the Majority Lenders (or, if so instructed by the Majority Lenders, refrain from exercising any right, power, authority or discretion vested in it as the Agent); and

(ii)

not be liable for any act (or omission) if it acts (or refrains from taking any action) in accordance with an instruction of the Majority Lenders.

(b)	Unless a contrary indication appears in a Finance Document, any instructions given by the Majority Lenders will be binding on all the Creditor Parties.

(c)	The Agent may refrain from acting in accordance with the instructions of the Majority Lenders until it has received such security as it may require for any cost, loss or liability (together with any associated value added tax) which it may incur in complying with the instructions.

(d)	In the absence of instructions from the Majority Lenders the Agent may act (or refrain from taking action) as it considers to be in the best interest of the Lenders.

(e)	The Agent is not authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to any Finance Document.

(f)

Notwithstanding anything to the contrary, the Lenders agree that if the Agent (acting in its sole discretion) is of the opinion that, or if any Lender notifies the Agent that it is of the opinion that, the prior approval of SACE should be obtained in relation to the exercise or non-exercise by the Agent or the Lenders of any power, authority or discretion specifically given to them under or in connection with the Finance Documents or in relation to any other incidental rights, powers, authorities or discretions, then the Agent shall seek such approval of SACE prior to such exercise or non-exercise.

25.8

Responsibility for documentation . The Agent is not responsible for:

(a)	the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by the Agent, a Mandated Lead Arranger, an Obligor or any other person given in or in connection with any Transaction Document or the SACE Insurance Policy; nor for

(b)	the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the SACE Insurance Policy or any other agreement, arrangement or document entered into, made or executed in anticipation of or in connection with any Transaction Document or the SACE Insurance Policy.

25.9

Exclusion of liability .

(a)	Without limiting Clause 25.9(b), the Agent will not be liable for any action taken by it under or in connection with any Finance Document, unless directly caused by its gross negligence or wilful misconduct.

(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 the SACE Insurance Policy 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 or the SACE Insurance Policy 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 a Mandated Lead Arranger to carry out any “know your customer” or other checks in relation to any person on behalf of any Lender and each Lender confirms to the Agent and the Mandated Lead 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 a Mandated Lead Arranger.

25.10

Lenders’ indemnity to the Agent. 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 (3) 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 an Obligor pursuant to a Finance Document) .

25.11

Resignation of the Agent.

(a)	The Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Creditor Parties and the Borrower.

(b)	Alternatively the Agent may resign by giving notice to the other Creditor Parties and the Borrower, in which case the Lenders (after consultation with the Borrower) may appoint a successor Agent.

(c)	If the Lenders have not appointed a successor Agent in accordance with Clause 25.11(b) within thirty (30) days after notice of resignation was given, the Agent (after consultation with the Borrower) may appoint a successor Agent.

(d)	The retiring Agent shall, at its own cost, 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 but shall remain entitled to the benefit of this Clause 25. Its 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 SACE, the Lenders may, by notice to the Agent, require it to resign in accordance with Clause 25.11(b). In this event, the Agent shall resign in accordance with Clause 25.11(b).

25.12

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 another division or department of the Agent, it may be treated as confidential to that division or department and the Agent shall not be deemed to have notice of it.

25.13

Relationship with the Lenders . The Agent may treat each Lender as a Lender, entitled to payments under this Agreement and acting through its Facility Office unless it has received not less than five (5) Business Days’ prior notice from that Lender to the contrary in accordance with the terms of this Agreement.

25.14

Credit appraisal by the Lenders . Without affecting the responsibility of any Obligor for information supplied by it or on its behalf in connection with any Finance Document, each Lender confirms to the Agent and each of the Mandated Lead 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 Finance Document including but not limited to:

(a)	the financial condition, status and nature of the Guarantors and each subsidiary of the Guarantors;

(b)	the legality, validity, effectiveness, adequacy or enforceability of any Finance Document and any other agreement, arrangement or document entered into, made or executed in anticipation of under or in connection with any Finance Document;

(c)

whether that Lender 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 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; and

(d)

the adequacy, accuracy and/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 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.

25.15

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.

25.16

SACE Agen t. Where the context permits, references to the Agent shall include the SACE Agent. The Agent and the SACE Agent shall be the same entity throughout the Security Period.

26	CONDUCT OF BUSINESS BY THE CREDITOR PARTIES

26.1

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

(c)	oblige any Creditor Party to disclose any information relating to its affairs (Tax or otherwise) or any computations in respect of Tax.

27	SHARING AMONG THE CREDITOR PARTIES

27.1

Payments to Creditor Parties . If a Creditor Party (a “Recovering Creditor Party”) receives or recovers any amount from an Obligor other than in accordance with Clause 27 and applies that amount to a payment due under the Finance Documents then:

(a)	the Recovering Creditor Party shall, within three (3) 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 19 and Clause 28, without taking account of any Tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and

(c)

the Recovering Creditor Party shall, within three (3) 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 19 and Clause 28.

27.2

Redistribution of payments . The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and distribute it between the Creditor Parties (other than the Recovering Creditor Party) in accordance with Clause 19 and Clause 28.

27.3

Recovering Finance Party’s rights .

(a)	On a distribution by the Agent under Clause 27.2, the Recovering Creditor Party will, if possible under the relevant applicable laws, be subrogated to the rights of the Creditor Parties which have shared in the redistribution.

(b)	If and to the extent that the Recovering Creditor Party is not able to rely on its rights under Clause 27.3(a), the relevant Obligor shall be liable to the Recovering Creditor Party for a debt equal to the Sharing Payment which is immediately due and payable.

27.4

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 Lender which has received a share of the relevant Sharing Payment pursuant to Clause 27.2 shall, upon request of the Agent, pay to the Agent for 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); and

(b)	that Recovering Creditor Party’s rights of subrogation in respect of any reimbursement shall be cancelled and the relevant Obligor will be liable to the reimbursing Finance Party for the amount so reimbursed.

27.5

Exceptions .

(a)	This Clause 27 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 relevant Obligor.

(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.

28	PAYMENT MECHANICS

28.1

Payments to the Agent .

(a)

On each date on which an Obligor or a Lender is required to make a payment under a Finance Document, that Obligor or Lender shall make the same available to the Agent (unless a contrary indication appears in a Finance Document) for value on the due date at the time and in such funds specified by the Agent as being customary at the time for settlement of transactions in the relevant currency in the place of payment.

(b)	Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to Euro, in a principal financial centre in a Participating Member State or London) with such bank as the Agent specifies.

(c)	Payment shall be made before 11.00 a.m. New York time or 11.00 a.m. Paris time (in the case of a payment in Euro).

(d)	For each payment by the Borrower, it shall notify the Agent on the third Business Day prior to the due date for payment that it will issue to its bank (which shall be named in such notification) to make the payment.

28.2

Distributions by the Agent . Each payment received by the Agent under the Finance Documents for another Party shall, subject to Clause 28.3, Clause 28.4 and Clause 28.15 be made available by the Agent as soon as practicable after receipt to the Party entitled to receive payment in accordance with this Agreement (in the case of a Lender, for the account of its Facility Office), to such account as that Party may notify to the Agent by not less than five (5) Business Days’ notice with a bank in the principal financial centre of the country of that currency (or, in relation to Euro, in the principal financial centre of a Participating Member State or London).

28.3

Distributions to an Obligor . The Agent may in accordance with Clause 22 apply any amount received by it for that Obligor in or towards payment (on the date and in the currency and funds of receipt) of any amount due from that Obligor under the Finance Documents or in or towards purchase of any amount of any currency to be so applied.

28.4

Clawback .

(a)

Where a sum is to be paid to the Agent under the Finance Documents for another Party, the Agent is not obliged to pay that sum to that other Party (or to enter into or perform any related exchange contract) until it has been able to establish to its satisfaction that it has actually received that sum.

(b)

If the Agent pays an amount to another Party and it proves to be the case that the Agent had not actually received that amount, then the Party to whom that amount (or the proceeds of any related exchange contract) was paid by the Agent shall on demand refund the same to the Agent together with interest on that amount from the date of payment to the date of receipt by the Agent, calculated by the Agent to reflect its cost of funds.

28.5

No set-off by Obligors . All payments to be made by an Obligor under the Finance Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.

28.6

Business Days .

(a)	Any payment which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).

(b)	During any extension of the due date for payment of any principal or unpaid sum under this Agreement interest is payable on the principal or unpaid sum at the rate payable on the original due date.

28.7

Currency of account .

(a)	Subject to Clauses 28.7(b) and 28.7(c) Dollars is the currency of account and payment for any sum from an Obligor under any Finance Document.

(b)	Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or taxes are incurred.

(c)	Any amount expressed to be payable in a currency other than Dollars shall be paid in that other currency.

28.8

Change of currency .

(a)	Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:

(i)

any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Agent (after consultation with the Lenders and the Borrower); and

(ii)

any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Agent (acting reasonably).

(b)

If a change in any currency of a country occurs, this Agreement will, to the extent the Agent (acting reasonably and after consultation with the Lenders and the Borrower) specifies to be necessary, be amended to comply with any generally accepted conventions and market practice in the relevant interbank market and otherwise to reflect the change in currency.

29	GOVERNING LAW

29.1

Law . This Agreement is governed by English law.

30	ENFORCEMENT

30.1

Jurisdiction of English courts . The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each Party agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.

This Clause 30.1 is for the benefit of the Creditor Parties only. As a result, no Creditor Party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any Creditor Party may take concurrent proceedings in any number of jurisdictions.

30.2

Service of process . Without prejudice to any other mode of service allowed under any relevant law, the Borrower:

(a)	irrevocably appoints EC3 Services Limited of 51 Eastcheap, London EC3M 1JP, as its agent for service of process in relation to any proceedings before the English courts in connection with any Finance Document; and

(b)	agrees that failure by a process agent to notify the Borrower of the process will not invalidate the proceedings concerned.

31	SCHEDULES

31.1

Integral Part . The schedules form an integral part of this Agreement.

32	NOTICES

32.1

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.

32.2

Addresses for communications. A notice shall be sent:


(a)	to the Borrower:	8300 NW 33rd Street #308 Miami, FL 33122, USA

		Fax No: (00) 1305 514 2297

(b)	to a Lender:	At the address below its name in Schedule 1 or (as the case may require) in the relevant Transfer Certificate.

(c)	to the Agent or the SACE Agent:	9 quai du Président Paul Doumer 92920 Paris La Défense Cedex France

		Fax No: (33) 1 41 89 29 87 Attn: Shipping Group Mr. Guy-Olivier Bygodt

		and

		Fax No: (33) 1 41 89 19 34 Attn: Shipping Middle Office Ms. Sylvie Godet-Couery

or to such other address as the relevant party may notify the Agent or, if the relevant party is the Agent, the Borrower, the Lenders and the Borrower.

32.3

Effective date of notices . Subject to Clauses 32.4 and 32.5:

(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;

(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.

32.4

Service outside business hours . However, if under Clause 32.3 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 6 p.m. local time;

the notice shall (subject to Clause 32.5) be deemed to be served, and shall take effect, at 9 a.m. on the next day which is such a business day.

32.5

Illegible notices . Clauses 32.3 and 32.4 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.

32.6

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.

32.7

English language . Any notice under or in connection with a Finance Document shall be in English.

32.8

Meaning of “notice” . In this Clause 32, “notice” includes any demand, consent, authorisation, approval, instruction, waiver or other communication.

33	SUPPLEMENTAL

33.1

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.

33.2

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.

33.3

Counterparts . A Finance Document may be executed in any number of counterparts.

33.4

Third party rights . 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 provided that nothing in this Clause shall limit or prejudice the exercise by SACE of its rights under this Agreement or the Finance Documents in the event that such rights are subrogated or assigned to it pursuant to the terms of the SACE Insurance Policy.

33.5

No waiver. No failure or delay on the part of a Creditor Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise thereof preclude any other or further exercise thereof by the Creditor Parties or the exercise by the Creditor Parties of any other right, power or privilege. The rights and remedies of the Creditor Parties herein provided are cumulative and not exclusive of any rights or remedies provided by law.

33.6

Writing required . This Agreement shall not be capable of being modified otherwise than by an express modification in writing signed by the Borrower, the Agent and the Lenders.

THIS AGREEMENT has been entered into on the date staled at the beginning of this Agreement.

SCHEDULE 1

LENDERS AND COMMITMENTS

SCHEDULE 2

FORM OF DRAWDOWN NOTICE

To:

[Calyon]

Attention: [Loans Administration]

[ — ]

DRAWDOWN NOTICE

We refer to the loan agreement (the “ Loan Agreement ”) dated [ — ] July 2008 and made between ourselves, as Borrower, the Lenders and Mandated Lead Arrangers referred to therein, and yourselves as Agent in connection with a facility of the Dollar Equivalent of up to EUR 349,520,718. 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$[ — ];

(b)	Drawdown Date: [ — ];

(c)	[Duration of the first Interest Period shall be [ — ] months;]

(d)	Payment instructions: [to be completed].

3	We represent and warrant that:

(a)	the representations and warranties in Clauses 12.2 and 12.3 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;

(b)	no 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 Agent.

5	We authorise you to deduct the commitment fee accrued and unpaid referred to in Clause 10.1(b) from the amount of the Loan.

[Name of Signatory]

Director

for and on behalf of

MARINA NEW BUILD, LLC

SCHEDULE 3

DOCUMENTS TO BE PRODUCED BY THE BUILDER

TO THE AGENT ON DELIVERY

Certified Copy of the commercial invoice, evidencing payment by the Borrower and receipt by the Builder of the instalments already paid pursuant to the Shipbuilding Contract and the Final Contract Price, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.

Certified copy of bank statements evidencing receipt by the Builder of the first, second, third and fourth instalments of the Initial Contract Price (as described in Recital (B)).

Certified Copy of the Protocol of Delivery and Acceptance, duly executed by the Builder and the Borrower.

Certified Copy of the declaration of warranty, duly executed by the Builder confirming that the Ship is delivered to the Borrower free and clear of all encumbrances whatsoever.

Certified Copy of the commercial invoice(s) corresponding to the Change Orders (if any) or any other similar document issued by the Builder stating the Change Order Amount, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.

Certified copy of certificate duly executed by the Builder attesting the exit of goods from the country of origin in the forms provided by the laws in force and representation duly signed by the Builder specifying the origin of the exported goods and in which there are declared all the amounts transferred abroad for any reason regarding the performance of the Shipbuilding Contract.

Certified copy of the acknowledgement of the notice of assignment of the Borrower’s rights under the post-delivery warranty given by the Builder under the Shipbuilding Contract pursuant to the Post-Delivery Assignment.

Certified Copy of the power of attorney pursuant to which the authorised signatory of the Builder signed the documents referred to in this Schedule 3 and a specimen of his signature.

Certified Copy of the Exporter’s Declaration to SIMEST duly executed by the Builder and delivered to SIMEST (where the Fixed Interest Rate has been selected).

EXECUTION PAGES


BORROWER

SIGNED by		)
Frank J. Del Rio		)
for and on behalf of		)
MARINA NEW BUILD, LLC		)
in the presence of:		)
Luis San Miguel
CFO
Oceania Cruises

LENDERS

SIGNED by		)
Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
in the presence of:		)
Luis San Miguel
CFO
Oceania Cruises

SIGNED by		)
Geoffrey D. Ferrer		)
for and on behalf of		)
SOCIETE GENERALE		)
in the presence of:		)
Luis San Miguel
CFO
Oceania Cruises

MANDATED LEAD ARRANGERS
SIGNED by		)
Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
in the presence of:		)
Luis San Miguel CFO Oceania Cruises


SIGNED by Geoffrey D. Ferrer		)
SOCIETE GENERALE		)
for and on behalf of		)
		)
in the presence of:		)
Luis San Miguel
CFO
Oceania Cruises

AGENT and SACE AGENT

SIGNED by		)
Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
in the presence of:		)
Luis San Miguel
CFO
Oceania Cruises

EXHIBIT A

FORM OF LETTER OF CREDIT

IRREVOCABLE LETTER OF CREDIT NUMBER [**BANK TO INSERT**]

[**BANK TO INSERT DATE OF ISSUANCE**]

BENEFICIARY:

CALYON, AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT, DATED [**DATE TO BE INSERTED**] BETWEEN MARINA NEW BUILD LLC AS BORROWER, THE BANKS AND FINANCIAL INSTITUTIONS LISTED IN SCHEDULE 1 THERETO AS LENDERS, CALYON AND SOCIÉTÉ GÉNÉRALE AS MANDATED LEAD ARRANGERS AND CALYON AS AGENT AND SACE AGENT WITH RESPECT TO THE LOAN AGREEMENT DATED 2008 IN RESPECT OF THE FINANCING OF VESSEL HAVING HULL NO 6194 (THE “ LOAN AGREEMENT ”).

9, QUAI DU PRÉSIDENT PAUL DOUMER

92920 PARIS LA DÉFENSE CEDEX, FRANCE

LADIES & GENTLEMEN:

WE, [ — ] OF [ — ] (THE “ BANK ”), HEREBY ISSUE IN FAVOR OF CALYON, AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT, AS BENEFICIARY, OUR IRREVOCABLE LETTER OF CREDIT NO. [**BANK TO INSERT**], EFFECTIVE IMMEDIATELY, FOR ACCOUNT OF OCEANIA VESSEL FINANCE, LTD. (THE “ APPLICANT ”), IN AN AMOUNT OF U.S. [**TO BE INSERTED ON THE DATE OF ISSUANCE**] (AS SUCH AMOUNT MAY BE REDUCED FROM TIME TO TIME AS PROVIDED HEREIN, THE “ STATED AMOUNT ”).

THIS LETTER OF CREDIT IS ISSUED IN CONNECTION WITH THE TRANSACTION CONTEMPLATED BY THE LOAN AGREEMENT.

THE STATED AMOUNT IS AVAILABLE TO YOU HEREUNDER IN IMMEDIATELY AVAILABLE FUNDS AGAINST PRESENTATION TO US AT OUR OFFICE LOCATED AT [**BANK TO INSERT ADDRESS**], ATTENTION: [**BANK TO INSERT**] OF YOUR APPROPRIATELY COMPLETED DRAWING CERTIFICATE IN THE FORM OF EXHIBIT A ATTACHED HERETO.

SUBJECT TO THE TERMS AND CONDITIONS HEREOF, DRAWING CERTIFICATES MAY BE PRESENTED HEREUNDER FROM TIME TO TIME ON ONE OR MORE OCCASIONS BY FACSIMILE TRANSMISSION TO FAX NO. [**BANK TO INSERT**] AND ORIGINAL BY OVERNIGHT COURIER PROVIDED THAT FAILURE OF RECEIPT OF FACSIMILE TRANSMISSION IS NO REASON FOR DISHONOR IF THE ORIGINAL IS RECEIVED BY COURIER.

IF A DRAWING CERTIFICATE IS RECEIVED BY THE BANK AT OR PRIOR TO 1:00 P.M., NEW YORK CITY TIME ON A BUSINESS DAY, AND PROVIDED THAT SUCH DRAWING CERTIFICATE CONFORMS TO THE TERMS AND CONDITIONS HEREOF, PAYMENT OF THE DRAWING AMOUNT SHALL BE MADE TO BENEFICIARY IN IMMEDIATELY AVAILABLE FUNDS ON THE SECOND BUSINESS DAY THEREAFTER. IF A DRAWING CERTIFICATE IS RECEIVED BY THE BANK AFTER 1:00 P.M., NEW YORK CITY TIME, ON A BUSINESS DAY, AND PROVIDED THAT SUCH DRAWING CERTIFICATE CONFORMS TO THE TERMS AND CONDITIONS HEREOF, PAYMENT OF THE DRAWING AMOUNT SHALL BE MADE TO BENEFICIARY IN IMMEDIATELY AVAILABLE FUNDS ON THE THIRD FOLLOWING BUSINESS DAY.

IF A DEMAND FOR PAYMENT MADE OR DRAWING CERTIFICATE PRESENTED HEREUNDER BY BENEFICIARY DOES NOT CONFORM TO THE TERMS AND CONDITIONS OF THIS LETTER

OF CREDIT, THE BANK SHALL GIVE BENEFICIARY NOTICE BY FACSIMILE TRANSMISSION AND OVERNIGHT COURIER DELIVERY WITHIN TWO BUSINESS DAYS OF PRESENTMENT THAT THE DEMAND FOR PAYMENT OR DRAWING CERTIFICATE WAS NOT MADE IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, STATING THE REASONS THEREFORE AND THAT THE BANK WILL RETURN SAME TO BENEFICIARY. UPON BEING NOTIFIED OF A NONCONFORMING DEMAND OR DRAWING CERTIFICATE, BENEFICIARY MAY ATTEMPT TO CORRECT SUCH DEMAND OR DRAWING CERTIFICATE TO THE EXTENT THAT IT IS ENTITLED TO DO SO.

THE STATED AMOUNT SHALL BE REDUCED PERMANENTLY BY THE AMOUNT OF EACH DRAWING HONORED BY THE BANK.

AS USED HEREIN, THE TERM BENEFICIARY SHALL MEAN CALYON, AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT OR ANY SUCCESSOR BY OPERATION OF LAW TO CALYON, AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT OR ANY SUCCESSOR AGENT APPOINTED IN PLACE OF CALYON UNDER THE LOAN AGREEMENT.

THE BENEFICIARY MAY ASSIGN OR TRANSFER ITS RIGHTS UNDER AND IN CONNECTION WITH THIS LETTER OF CREDIT TO SERVIZI ASSICURATIVI DEL COMMERCIO ESTERO - SACE SPA (“ SACE ”) AND, UPON NOTIFICATION BY THE BENEFICIARY TO THE BANK OF THE TRANSFER TO SACE, THE TRANSFER SHALL BE DEEMED TO BE EFFECTED AS OF THE DATE OF SUCH NOTIFICATION WITHOUT THE CONSENT OF THE BANK AND THEREAFTER SACE SHALL BE THE BENEFICIARY HEREUNDER AND RULE 6.02(b) (iii) OF INTERNATIONAL STANDBY PRACTICES 1998 (INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION 590) (THE “ ISP98 ”) SHALL NOT APPLY.

AS USED IN THIS LETTER OF CREDIT “ BUSINESS DAY ” SHALL MEAN ANY DAY OTHER THAN A SATURDAY, SUNDAY OR A DAY ON WHICH BANKING INSTITUTIONS IN NEW YORK CITY ARE REQUIRED OR AUTHORIZED TO CLOSE.

THIS LETTER OF CREDIT SHALL EXPIRE AT THE BANK’S OFFICE LOCATED AT [**BANK TO INSERT ADDRESS**], ATTENTION: [**BANK TO INSERT**] WITH OUR CLOSE OF BUSINESS ON [**BANK TO INSERT DATE 1 YEAR FROM ISSUANCE DATE**], (THE “ EXPIRATION DATE ”), UNLESS EXTENDED AS PROVIDED FOR BELOW.

IT IS A CONDITION OF THIS LETTER OF CREDIT THAT THE EXPIRATION DATE WILL BE AUTOMATICALLY EXTENDED, WITHOUT AMENDMENT, FOR A PERIOD OF AT LEAST ONE YEAR ON [**BANK TO INSERT DATE 1 YEAR FROM ISSUANCE DATE**], AND ON EACH SUCCESSIVE EXPIRATION DATE, UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO ITS EXPIRATION DATE THE BANK NOTIFIES THE BENEFICIARY BY FACSIMILE TRANSMISSION AND OVERNIGHT COURIER, THAT THE BANK ELECTS NOT TO SO EXTEND THE EXPIRATION DATE FOR SUCH ADDITIONAL PERIOD. UPON RECEIPT BY THE BENEFICIARY OF SUCH NOTICE THE BENEFICIARY MAY MAKE A SINGLE DRAWING HEREUNDER FOR UP TO THE THEN AVAILABLE STATED AMOUNT BY PRESENTING TO THE BANK THE BENEFICIARY’S DRAWING CERTIFICATE IN THE FORM ATTACHED HERETO AS EXHIBIT B.

NOTWITHSTANDING ANY REFERENCE IN THIS LETTER OF CREDIT TO OTHER DOCUMENTS, INSTRUMENTS OR AGREEMENTS OR REFERENCES IN SUCH OTHER DOCUMENTS, INSTRUMENTS OR AGREEMENTS TO THIS LETTER CREDIT, THIS LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF THE BANK’S UNDERTAKING AND ANY SUCH DOCUMENTS, INSTRUMENTS OR AGREEMENTS SHALL NOT BE DEEMED INCORPORATED HEREIN BY SUCH REFERENCE.

TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL, AS TO MATTERS NOT GOVERNED BY THE ISP98, BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREIN.

THE BANK HEREBY AGREES WITH THE BENEFICIARY THAT ANY DRAWING CERTIFICATE DRAWN UNDER AND IN COMPLIANCE WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE DULY HONORED BY THE BANK ON DUE PRESENTATION TO THE BANK, PROVIDED THAT SUCH DRAWINGS ARE MADE AND DRAWING CERTIFICATES ARE PRESENTED ON OR BEFORE THE EXPIRATION DATE OF THIS LETTER OF CREDIT.

COMMUNICATIONS TO THE BANK REGARDING THIS LETTER OF CREDIT MUST BE IN WRITING AND MUST BE ADDRESSED TO THE BANK AT [**BANK TO INSERT ADDRESS**], ATTENTION: [**BANK TO INSERT**] SPECIFICALLY REFERRING THEREIN TO THIS LETTER OF CREDIT BY ITS NUMBER.

VERY TRULY YOURS,

[ — ]

EXHIBIT A TO LETTER OF CREDIT NUMBER

[**BANK TO INSERT**] DRAWING CERTIFICATE


TO		[ — ]
		[BANK TO INSERT NAME AND ADDRESS]

ATTENTION:		[BANK TO INSERT]

RE:		YOUR LETTER OF CREDIT NO. [BANK TO INSERT]

LADIES & GENTLEMEN:

THE UNDERSIGNED, A DULY AUTHORIZED OFFICER OF THE BENEFICIARY, BEING CALYON AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT (AS DEFINED IN THE LETTER OF CREDIT) OR THE SUCCESSOR OR TRANSFEREE OF CALYON, HEREBY CERTIFIES TO [ — ] (THE “ BANK ”) WITH REFERENCE TO [ — ]’S IRREVOCABLE LETTER OF CREDIT NO. [**BANK TO INSERT**] (THE “ LETTER OF CREDIT ”) THAT:

DEMAND IS HEREBY MADE ON [ — ] UNDER THE LETTER OF CREDIT FOR PAYMENT OF U.S. $[AMOUNT TO BE INSERTED] WHICH AMOUNT DOES NOT EXCEED THE STATED AMOUNT AVAILABLE TO BE DRAWN UNDER THE LETTER OF CREDIT; AND

AN EVENT OF DEFAULT (AS DEFINED IN THE LOAN AGREEMENT) HAS OCCURRED; AND

BENEFICIARY HAS PROVIDED NOTICE TO OCEANIA CRUISES, INC. AND PRESTIGE CRUISE HOLDINGS, INC. OF THE EVENT OF DEFAULT REFERENCED IN CLAUSE (2) ABOVE AT LEAST THREE (3) BUSINESS DAYS PRIOR TO EXECUTING AND DELIVERING THIS CERTIFICATE.

PAYMENT OF THIS DEMAND IS REQUIRED TO BE MADE IN IMMEDIATELY AVAILABLE FUNDS, BY WIRE TRANSFER. TO BENEFICIARY IN ACCORDANCE WITH THE FOLLOWING PAYMENT INSTRUCTIONS:

[INSERT PAYMENT INSTRUCTIONS]

IN WITHESS WHEREOF BENEFICIARY HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS OF THE DAY OF , 20 .

VERY TRULY YOURS,

THE BENEFICIARY


BY:

NAME:

TITLE:

EXHIBIT B TO LETTER OF CREDIT NUMBER [**BANK TO INSERT**]

DRAWING CERTIFICATE


TO		[ — ]
		[BANK TO INSERT NAME AND ADDRESS]

ATTENTION:		[BANK TO INSERT]

RE:		YOUR LETTER OF CREDIT NO. [BANK TO INSERT]

LADIES & GENTLEMEN:

THE UNDERSIGNED, A DULY AUTHORIZED OFFICER OF THE BENEFICIARY, BEING CALYON AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT (AS DEFINED IN THE LETTER OF CREDIT) OR THE SUCCESSOR OR TRANSFEREE OF CALYON, HEREBY CERTIFIES TO [ — ] (THE “ BANK ”) WITH PREFERENCE TO [ — ]’S IRREVOCABLE LETTER OF CREDIT NO. [**BANK TO INSERT**] (THE “ LETTER OF CREDIT ”) THAT:

BENEFICIARY HAS RECEIVED NOTICE FROM THE BANK THAT THE EXPIRATION DATE OF THE LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE CURRENT EXPIRATION DATE OF [ DATE TO BE INSERTED ] .

PAYMENT OF THIS DEMAND IS REQUIRED TO BE MADE IN IMMEDIATELY AVAILABLE FUNDS, BY WIRE TRANSFER, TO BENEFICIARY IN ACCORDANCE WITH THE FOLLOWING PAYMENT INSTRUCTIONS:

[INSERT PAYMENT INSTRUCTIONS]

IN WITNESS WHEREOF BENEFICIARY HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS OF THE DAY OF , 20 .

VERY TRULY YOURS,

THE BENEFICIARY


BY:

NAME:

TITLE:

Exhibit 10.14

[*] THE CONFIDENTIAL PORTION HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Date 18 July 2008

RIVIERA NEW BUILD, LLC

as Borrower

– and –

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

– and –

CALYON

SOCIÉTÉ GÉNÉRALE

as Mandated Lead Arrangers

– and

CALYON

as Agent

and SACE Agent

LOAN AGREEMENT

relating to

the part financing of the passenger cruise ship newbuilding presently designated as

Hull No. 6195 at Fincantieri-Cantieri Navali Italiani S.p.A

Watson, Farley & Williams

Paris

INDEX



Clause		Page

1.	INTERPRETATION		2

2.	FACILITY		21

3.	CONDITIONS PRECEDENT		22

4.	DRAWDOWN		29

5.	REPAYMENT		30

6.	INTEREST		31

7.	INTEREST PERIODS		33

8.	CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS		33

9.	SACE PREMIUM AND ITALIAN AUTHORITIES		34

10.	FEES		35

11.	TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES		36

12.	REPRESENTATIONS AND WARRANTIES		39

13.	UNDERTAKINGS		44

14.	SECURITY VALUE MAINTENANCE		58

15.	LETTER OF CREDIT PROVISIONS		59

16.	CANCELLATION AND PREPAYMENT		61

17.	INTEREST ON LATE PAYMENTS		62

18.	EVENTS OF DEFAULT		63

19.	APPLICATION OF SUMS RECEIVED		68

20.	INDEMNITIES		68

21.	ILLEGALITY, ETC.		71

22.	SET-OFF		71

23.	CHANGES TO THE LENDERS		72

24.	CHANGES TO THE OBLIGORS		75

25.	ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS		75

26.	CONDUCT OF BUSINESS BY THE CREDITOR PARTIES		80

27.	SHARING AMONG THE CREDITOR PARTIES		81

28.	PAYMENT MECHANICS		82

29.	GOVERNING LAW		84

30.	ENFORCEMENT		84

31.	SCHEDULES		85



32.	NOTICES	85

33.	SUPPLEMENTAL	86

SCHEDULE 1 LENDERS AND COMMITMENTS		88

SCHEDULE 2 FORM OF DRAWDOWN NOTICE		89

SCHEDULE 3 DOCUMENTS TO BE PRODUCED BY THE BUILDER TO THE AGENT ON DELIVERY		90

EXECUTION PAGES		91

EXHIBIT A FORM OF LETTER OF CREDIT		96

THIS AGREEMENT is made on 18 July 2008

BETWEEN

(1)	RIVIERA NEW BUILD, LLC , a limited liability company formed in the Marshall Islands whose registered office is at c/o The Trust Company of the Marshall Islands Inc., Trust Company Complex, Ajeltake Island, Ajeltake Road, Majuro MH 96960, Republic of the Marshall Islands (the “ Borrower ”);

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1, as Lenders ;

(3)	CALYON and SOCIÉTÉ GÉNÉRALE as Mandated Lead Arrangers ; and

(4)	CALYON , as Agent and SACE Agent .

BACKGROUND

(A)

By a Master (Shipbuilding Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri - Cantieri Naevali Italiani SpA, a company incorporated in Italy with registered office in Trieste, via Genova, 1, and having fiscal code 00397130584 (the “ Builder ”), Prestige Cruise Holdings Inc., Oceania Cruises Inc. and, by way of endorsement, the Borrower providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6195 as more particularly described in the Shipbuilding Contract (the “ Ship ”) to be delivered on 30 July 2011 subject to any adjustments of such delivery date in accordance with the Shipbuilding Contract.

(B)	The total price payable by the Borrower to the Builder under the Shipbuilding Contract is EUR 409,095,000.00 (the “ Initial Contract Price ”) payable on the following terms:

(i)

as to [*]% by an initial payment which was made on the date when the Original Shipbuilding Contract entered into full effect pursuant to Article 33 of the Original Shipbuilding Contract and, as to the balance, upon signature of the Master Agreement;

(ii)

as to [*]% on the later of the start of steel cutting and 1 September 2009;

(iii)

as to [*]% on the later of keel laying and 1 February 2010;

(iv)

as to [*]% on the later of float out and 30 November 2010; and

(v)

as to [*]% on delivery of the Ship.

(C)

(D)

The Lenders have agreed to make available to the Borrower a Dollar loan facility for the purpose of assisting the Borrower in financing, subject to exchange rate fluctuations, up to 80% of the Final Contract Price and 100% of the instalment of the relevant SACE Premium which is payable on the Drawdown Date,

IT IS AGREED as follows:

1.	INTERPRETATION

1.1

Definitions. Subject to Clause 1.5, in this Agreement:

“ Affiliate ” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “ control ” (including, with correlative meanings, the terms “ controlling ”, “ controlled by ” and “ under common control with ”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract or otherwise;

“ Affected Lender ” has the meaning given in Clause 6.5;

“ Agent ” means Calyon, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, Quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre or any successor of it appointed under Clause 24;

“ Approved Flag ” means the Marshall Islands flag or such other flag as the Agent may, with the authorisation of the Majority Lenders, approve from time to time;

“ Availability Period ” means the period commencing on the date of this Agreement and ending on:

(a)

the earlier to occur of (i) the Delivery Date and (ii) the date falling 360 days (being the period stipulated in Article 8.6 of the Shipbuilding Contract) after 30 July 2011 (or such later date as the Agent may, with the authorisation of the Lenders, agree with the Borrower); or

(b)

if earlier, the date on which the Total Commitments are fully borrowed, cancelled or terminated;

“ Base Rate ” means one Euro for [*] Dollars;

“ Builder ” has the meaning given in Recital (A);

“ Compliance Certificates ” means the Prestige Holdings Compliance Certificate and the Oceania Cruises Compliance Certificate and, in the singular, either of them;

“ Contribution ” means, in relation to a Lender, the part of the Loan which is owing to that Lender;

“ Conversion Rate ” means the rate determined by the Agent on the Conversion Rate Fixing Date and notified to the Borrower as being:

(a)

the Base Rate; or

(b)

(c)

(i)

the FOREX Contracts Weighted Average Rate; and

(ii)

the Base Rate increased by 10% (ten per cent);

“ Conversion Rate Fixing Date ” means the date falling [*] ([*]) days before the Intended Delivery Date;

“ Creditor Party ” means the Agent, the SACE Agent, the Mandated Lead Arrangers or any Lender, whether as at the date of this Agreement or at any later time;

“ Delivery Date ” means the date and time of delivery of the Ship by the Builder to the Borrower as stated in the Protocol of Delivery and Acceptance;

“ Dollar Equivalent ” means such amount in Dollars as is calculated by the Agent on the Conversion Rate Fixing Date to be the equivalent of an amount in Euro at the Conversion Rate;

“ Dollars ” and “ $ ” means the lawful currency for the time being of the United States of America;

“ Drawdown Date ” means the date on which the Loan is drawn down and applied in accordance with Clause 2;

“ Drawdown Notice ” means a notice in the form set out in Schedule 2 (or in any other form which the Agent approves or reasonably requires);

(a)

(b)

all moneys which are at any time payable under Insurances in respect of loss of earnings; and

(c)

“ Eligible

Amount ” means 80% of the lesser of:

(a)

the Dollar Equivalent of EUR 418,237,911; and

(b)

the Dollar Equivalent of the Final Contract Price

in each case less any Letter of Credit Reduction;

“ Eur o ” and “ EUR ” means the single currency of the Participating Member States;

“ Event of Default ” means any of the events or circumstances described in Clause 18.1;

“ Finance Documents ” means:

(a)

this Agreement;

(b)

the Guarantees;

(c)

the General Assignment;

(d)

the Letter of Credit;

(e)

any External Management Agreement Assignment;

(f)

the Mortgage;

(g)

the Post-Delivery Assignment;

(h)

the Limited Liability Company Interests Security Deed;

(i)

any Time Charter Assignment;

(j)

the Approved Manager’s Undertaking; and

(k)

“ Final Contract Price ” has the meaning given in Recital (C);

“ 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 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)

(f)

“ Fixed Interest Rate ” means CIRR;

“ Floating Interest Rate ” means, in respect of any Interest Period, the rate per annum determined by the Agent to be the aggregate of:

(a)

the Margin; and

(b)

LIBOR for the relevant period.

(i)

(ii)

(iii)

(i)

FOREX Contracts that are spot or forward foreign exchange contracts, if any, shall be valued at the contract value (taking into account any rescheduling);

(ii)

(iii)

(iv)

“ Group ” means Prestige Holdings and its subsidiaries;

“ Guarantees ” means the Oceania Cruises Guarantee and the Prestige Holdings Guarantee;

“ Guarantors ” means Oceania Cruises and Prestige Holdings;

“ IAPPC ” means a valid international air pollution prevention certificate for the Ship issued under Annex VI;

“ Initial Contract Price ” has the meaning given in Recital (B);

“ Insurances ” means:

(a)

(b)

all rights and other assets relating to, or derived from, any of the foregoing, including any rights to a return of a premium;

“ Intended Delivery Date ” means 30 July 2011 (the date on which the Ship will be ready for delivery pursuant to the Shipbuilding Contract as at the date of this Agreement) or any other date notified by the Borrower to the Agent in accordance with Clauses 3.5(a) or 3.7(c) as being the date on which the Builder and the Borrower have agreed that the Ship will be ready for delivery pursuant to the Shipbuilding Contract;

“ Interest Period ” means a period determined in accordance with Clause 7;

“ ISPS Code ” means the International Ship and Port Facility Security Code adopted by the International Maritime Organisation;

“ Italian Authorities ” means SACE and/or SIMEST and any other relevant Italian authorities involved in the implementation of the Loan;

“ Lender ” means a bank or financial institution listed in Schedule 1 and acting through its Facility Office or its transferee, successor or assign;

“ Letter of Credit Amount ” means either:

(a)

the face amount of the Letter of Credit (if any) issued on or prior to the Letter of Credit Issue Date in accordance with Clause 15.1; or

(b)

if no Letter of Credit has been issued in accordance with Clause 15.1, zero;

(a)

the Letter of Credit ceasing or failing to be in full force and effect in accordance with its terms for any reason whatsoever other than by virtue of Clause 15.4; or

(b)

any event or circumstance referred to in Clauses 18.7 to 18.12 (inclusive) occurring or existing, mutatis mutandis, in relation to the Letter of Credit Issuer;

“ Letter of Credit Issue Date ” means the date falling fifteen (15) Business Days prior to the Intended Delivery Date;

“ Letter of Credit Issuer ” means Lehman Brothers Bank, Federal Savings Bank, a company incorporated in Delaware or any other financial institution acceptable to the Agent;

“ Letter of Credit Reduction ” means USD50,000,000 less the aggregate of:

(a)

the Letter of Credit Amount; and

(b)

the cumulative amount of all drawings in respect of the Builder Letter of Credit on or prior to the earlier of:

(i)

the date of issue of the Letter of Credit (if any); and

(ii)

the Letter of Credit Issue Date;

“ Letter of Credit Release Event ” has the meaning given in Clause 15.4;

“ Loan ” means the principal amount for the time being outstanding under this Agreement;

“ Majority Lenders ” means:

(a)

before the Loan has been made, Lenders whose Commitments total [*] per cent of the Total Commitments; and

(b)

after the Loan has been made, Lenders whose Contributions total [*] per cent of the Loan;

“ Margin ” means zero point fifty five percent (0.55%) per annum;

“ Maximum Loan Amount ” means the aggregate of:

(a)

the Dollar Equivalent of Euro [*]; and

(b)

[*]% of the second instalment of the SACE Premium payable on the Drawdown Date,

“ Negotiation Period ” has the meaning given in Clause 6.8;

“ Obligors ” means the Borrower, the Guarantors and (in the event that the Approved Manager is a member of the Group) the Approved Manager;

“ Oceania Cruises Compliance Certificate ” has the meaning given to “Compliance Certificate” in the Oceania Cruises Guarantee;

“ Oceania Cruises Guarantee ” means a guarantee issued or to be issued as provided in Clause 3.2 by Oceania Cruises in favour of the Agent, the SACE Agent and the Lenders in the agreed form;

“ Other Loan Agreement ” means the loan agreement dated on or about the date of this Agreement between Marina New Build, LLC and the parties to this Agreement (other than the Borrower);

“ Other Ship ” means the passenger cruise ship defined as the “Ship” in the Other Loan Agreement;

“ Party ” means a party to this Agreement from time to time;

“ Permitted Security Interests ” means:

(A)

in the case of the Borrower,

(i)

any of the Security Interests referred to in paragraph (a) below, and

(ii)

(B)

in the case of a Guarantor,

(i)

any of the Security Interests referred to in paragraphs (a), (d), (f) and (g) below, and

(ii)

(a)

any Security Interest created by or pursuant to the Finance Documents and any deposits or other Security Interests placed or incurred in connection with any bond or other surety from time to time provided to the US Federal Maritime Commission in order to comply with laws, regulations and rules applicable to the operators of passenger vessels operating to or from ports in the United States of America;

(b)

liens on the Ship up to an aggregate amount at any time not exceeding [*] Dollars ($[*]) for current crew’s wages and salvage and liens incurred in the ordinary course of trading the Ship;

(c)

any deposits or pledges up to an aggregate amount at any time not exceeding [*] ($[*]) to secure the performance of bids, tenders, bonds or contracts required in the ordinary course of business;

(d)

(e)

(without prejudice to the provisions of Clause 13.11) liens on assets leased, acquired or upgraded after the date hereof or assets newly constructed or converted after the date

hereof provided that (i) such liens secure Financial Indebtedness otherwise permitted under this Agreement, (ii) such liens are incurred at the time of such lease, acquisition, upgrade, construction or conversion and (iii) the Financial Indebtedness secured by such liens does not exceed the cost of such upgrade or the cost of such assets acquired or leased;

(f)

(g)

(h)

liens in favour of credit card companies on unearned customer deposits pursuant to agreements therewith;

(i)

liens in favour of customers on unearned customer deposits.

“ Pertinent Document ” means:

(a)

any Finance Document;

(b)

any policy or contract of insurance contemplated by or referred to in Clause 13 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)

“ 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;

“ Prestige Holdings ” means Prestige Cruise Holdings Inc., a Panamanian sociedad anonima domiciled in Panama whose resident agent is Arias, Fabrega & Fabrega at Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama;

“ Prestige Holdings Compliance Certificate ” has the meaning given to “Compliance Certificate” in the Prestige Holdings Guarantee;

“ Repayment Date ” means a date on which a repayment is required to be made under Clause 5;

“ 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”;

“ SACE ” means Servizi Assicurativi del Commercio Estero - SACE SpA;

“ SACE Agent ” means Calyon, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, Quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre or any successor of it appointed under Clause 25;

“ SACE Insurance Policy ” means the insurance policy in respect of this Agreement to be issued by SACE for the benefit of the Lenders, in form and substance satisfactory to the Agent;

“ SACE Premium ” means the amount payable by the Borrower to SACE through the Agent in two instalments in respect of the SACE Insurance Policy as set out in Clause 9;

“ 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)

“ Security Period ” means the period commencing on the date of this Agreement and ending on the date on which:

(a)

all amounts which have become due for payment by the Borrower or any Obligor under the Finance Documents have been paid;

(b)

no amount is owing or has accrued (without yet having become due for payment) under any Finance Document;

(c)

neither the Borrower nor any other Obligor has any future or contingent liability under Clause 19 below or any other provision of this Agreement or another Finance Document; and

(d)

“ Security Value ” means the amount in Dollars (as certified by the Agent whose certificate shall, in the absence of manifest error, be conclusive and binding on the Borrower and the Agent) which, at any relevant time, is the aggregate of (i) the market value of the Ship as most recently determined in accordance with Clause 13.18; and (ii) the market value of any additional security for the time being actually provided to the Agent pursuant to Clause 14;

“ Ship ” means the passenger cruise ship currently designated with Hull No. 6195 (as more particularly described in the Shipbuilding Contract) to be constructed under the Shipbuilding Contract and to be delivered to, and purchased by, the Borrower and registered in its name under an Approved Flag with the name “RIVIERA”;

“ Shipbuilding Contract ” has the meaning given in Recital (A);

“ SIMEST ” means Società Italiana per Le Imprese all’Estero – SIMEST Spa, which grants export subsidies in Italy under and according to the Italian Legislative Decree n. 143/98 and its amendments;

“ Total Loss ” means:

(a)

actual, constructive, compromised, agreed or arranged total loss of the Ship;

(b)

any expropriation, confiscation, requisition or acquisition of the Ship, whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected by any government or official authority or by any person or persons claiming to be or to represent a government or official authority (excluding a requisition for hire for a fixed period not exceeding 1 year without any right to an extension) unless it is within 1 month redelivered to the Borrower’s full control;

(c)

any arrest, capture, seizure or detention of the Ship (including any hijacking or theft) unless it is within 1 month redelivered to the Borrower’s full control;

“ Total Loss Date ” means:

(a)

in the case of an actual loss of the Ship, the date on which it occurred or, if that is unknown, the date when the Ship was last heard of;

(b)

in the case of a constructive, compromised, agreed or arranged total loss of the Ship, 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 with the Ship’s insurers in which the insurers agree to treat the Ship as a total loss; and

(c)

“ Transaction Documents ” means the Finance Documents and the Underlying Documents;

1.2

Construction of certain terms. In this Agreement:

“ approved ” means, for the purposes of Clause 13.20, 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, license, 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, fax or telex;

“ expense ” means any kind of cost, charge or expense (including all legal costs, charges and expenses) and any applicable value added or other tax;

“ 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;

“ obligatory insurances ” means all insurances effected, or which the Borrower is obliged to effect, under Clause 13.20 or any other provision of this Agreement or another Finance Document;

“ parent company ” has the meaning given in Clause 1.4;

“ 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;

reason of the incorporation in them of Clause 1 of the Institute Time Clauses (Hulls) (1/10/83) or Clause 8 of the Institute Time Clauses (Hulls) (1/11/1995) or the Institute Amended Running Down Clause (1/10/71) or any equivalent provision;

“ subsidiary ” has the meaning given in Clause 1.4;

“ war risks ” includes the risk of mines and all risks excluded by Clause 23 of the Institute Time Clauses (Hulls) (1/10/83) or Clause 24 of the Institute Time Clauses (Hulls) (1/11/1995).

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

(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)

(b)	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;

(c)	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;

(d)	words denoting the singular number shall include the plural and vice versa; and

(e)	Clauses 1.1 to 1.5 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 agree to make available to the Borrower a loan not exceeding the Maximum Loan Amount intended to be applied as follows:

(a)	in payment to the Builder of all or part of 80% of the Final Contract Price up to the Eligible Amount; and

(b)	in reimbursement to the Agent on behalf of the Lenders of the amount of the second instalment of the SACE Premium payable by it to SACE on the Drawdown Date.

2.2

Lenders’ participations in Loan. Subject to the other provisions of this Agreement, each Lender shall participate in the Loan in the proportion which, as at the Drawdown Date, its Commitment bears to the Total Commitments.

2.3

Purpose of Loan. The Borrower undertakes with each Creditor Party to use the Loan only to pay for:

(a)	goods and services of Italian origin incorporated in the design, construction or delivery of the Ship;

(b)

subject to the limits and conditions fixed by the Italian Authorities, goods and services incorporated in the design, construction or delivery of the Ship and originating from countries other than Italy where the provision of such goods or services has been sub-contracted by the Builder and therefore remains the Builder’s responsibility under the Shipbuilding Contract; and

(c)	the second instalment of the SACE Premium payable on the Drawdown Date.

2.4

Proceedings by individual Lender requiring Majority Lender consent. Except for the SACE Agent, no Lender may commence proceedings against the Borrower or any other Obligor in connection with a Finance Document without the prior consent of all the Lenders.

2.5

Obligations of Lenders several. The obligations of the Lenders under this Agreement are several; and a failure of a Lender to perform its obligations under this Agreement shall not result in:

(a)	the obligations of the other Lenders being increased; nor

(b)	any Obligor or any other Lender being discharged (in whole or in part) from its obligations under any Finance Document;

and in no circumstances shall a Lender have any responsibility for a failure of another Lender to perform its obligations under this Agreement.

3.	CONDITIONS PRECEDENT

3.1

General. The Borrower may only draw under the Loan when the following conditions have been fulfilled to the satisfaction of the Agent and provided no Event of Default shall have occurred and remains unremedied or is likely to occur as a consequence of the drawing of the Loan:

3.2

No later than the date of this Agreement. The Agent shall have received no later than the date of this Agreement:

(a)

(i)

the Borrower has been duly formed and is validly existing as a limited liability company under the laws of the Republic of the Marshall Islands;

(ii)

this Agreement falls within the scope of the Borrower’s limited liability company purpose as defined by its Certificate of Formation and Limited Liability Company Agreement;

(iii)

the Borrower’s representatives were at the date of this Agreement fully empowered to sign this Agreement;

(iv)

(v)

this Agreement constitutes the legal, valid and binding obligations of the Borrower enforceable in accordance with its terms,

and containing such exceptions as are standard for opinions of this type;

(b)	an opinion from legal counsel to the Agent as to English law confirming that the obligations of the Borrower under this Agreement are legally valid and binding obligations enforceable by the relevant Creditor Parties in the English courts;

(c)	a Certified Copy of the executed Shipbuilding Contract;

(d)	a confirmation from EC3 Services Limited that it will act for the Borrower as agent for service of process in England in respect of this Agreement and any other Finance Document;

(e)

(i)

(ii)

each Guarantee falls within the scope of the relevant Guarantor’s corporate purpose as defined by its Articles of Incorporation and By-laws;

(iii)

each Guarantor’s representative was at the date of the Guarantee issued by it fully empowered to sign that Guarantee;

(iv)

(v)

each Guarantee is the legal, valid and binding obligations of the Guarantor which issued it enforceable in accordance with its terms; and

(vi)

none of the undertakings of either Guarantor contained in either Guarantee are contrary to public policy in the Republic of Panama,

and containing such exceptions as are standard for opinions of this type;

(f)	duly executed originals of the Guarantees;

(g)	an opinion from legal counsel to the Agent as to English law confirming that the obligations of each Guarantor under the Guarantee issued by it are legally valid and binding obligations enforceable by the relevant Creditor Parties in the English courts; and

(h)	confirmation from EC3 Services Limited that it will act for each Guarantor as agent for service of process in England in respect of the Guarantee issued by that Guarantor and any other Finance Document.

3.3

No later than ninety (90) days before the Intended Delivery Date. The Agent shall have received no later than ninety (90) days before the Intended Delivery Date:

(a)	notification from the Borrower of its preferred Maritime Registry;

(b)	the SACE Insurance Policy documentation relating to the transaction contemplated by this Agreement issued on terms whereby the SACE Insurance Policy will enter into full force and effect upon fulfilment of the conditions specified therein to be fulfilled on or before the Drawdown Date; and

(c)	notification of the Approved Manager.

3.4

No later than the date falling ninety (90) days before the Intended Delivery Date and on each subsequent date on which a Compliance Certificate is to be received by the Agent pursuant to clause 11.3(e) of the Prestige Holdings Guarantee and clause 11.3(e) of the Oceania Cruises Guarantee. The Agent shall have received on the date falling ninety (90) days before the Intended Delivery Date and also on each subsequent date on which a Compliance Certificate is to be received by the Agent pursuant to clause 11.3(e) of the Prestige Holdings Guarantee and clause 11.3(e) of the Oceania Cruises Guarantee a duly completed Compliance Certificate from each Guarantor;

3.5

No later than sixty (60) days before the Intended Delivery Date. The Agent shall have received from the Borrower no later than sixty (60) days before the Intended Delivery Date:

(a)	notification of the Intended Delivery Date;

(b)

notification, signed by a duly authorised signatory of the Borrower, specifying which of the Fixed Interest Rate or the Floating Interest Rate shall be applicable to the Loan until the date of payment of the final repayment instalment of the Loan; and in absence of any such notification, the Borrower shall be deemed to have opted for the Floating Interest Rate.

3.6

No later than fifteen (15) Business Days before the Intended Delivery Date. The Agent shall have received no later than fifteen (15) Business Days before the Intended Delivery Date insurance documents in form and substance satisfactory to the Lenders confirming that the Insurances have been effected and will be in full force and effect on the Delivery Date.

3.7

No later than five (5) Business Days before the Intended Delivery Date. The Agent shall have received no later than five (5) Business Days before the Intended Delivery Date:

(a)	the Drawdown Notice from the Borrower, signed by a duly authorised signatory of the Borrower, specifying the amount of the Loan to be drawn down;

(b)	a Certified Copy of each of the Change Orders, of any amendments to the Shipbuilding Contract and of the power of attorney pursuant to which the authorised signatory of the Borrower signed the Drawdown Notice and a specimen of his signature; and

(c)	a final confirmation of the Intended Delivery Date signed by a duly authorised signatory of the Borrower, and counter-signed by a duly authorised signatory of the Builder.

3.8

No later than the Delivery Date. The Agent shall have received no later than the Delivery Date:

(a)

(i)

the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.2(a);

(ii)

the Mortgage, the General Assignment, the External Management Agreement Assignment (if any), the Post-Delivery Assignment and the

Time Charter Assignment (if any) fall within the scope of the Borrower’s limited liability company purpose as defined by its Certificate of Formation and Limited Liability Company Agreement and are binding on it; and

(iii)

(b)

(c)	evidence of payment to the Builder of:

(i)

the [*] ([*]) pre-delivery instalments of the Final Contract Price; and

(ii)

any other part of the Final Contract Price as at the Delivery Date not being financed hereunder;

(d)	evidence of payment of all amounts which are due and payable hereunder by the Borrower on or prior to the Delivery Date;

(e)	a certificate from the Borrower, signed by an authorised representative of the Borrower, confirming that the representations and warranties contained in Clause 12 are true and correct as of the Delivery Date in consideration of the facts and circumstances existing as of the Delivery Date;

(f)	the Interest Make-up Agreement relative to the Loan and in full force and effect;

3.9

At Delivery. Immediately prior to the delivery of the Ship by the Builder to the Borrower, the Agent shall have received:

(a)	evidence that immediately following delivery:

(i)

the Ship will be registered in the name of the Borrower in the Maritime Registry;

(ii)

(iii)

(iv)

the opinions mentioned in Clauses 3.9(j), (k) and (l) and the documents mentioned in Clause 3.9(m) will be received by the Agent;

(b)	a Certified Copy of a classification certificate (or interim classification certificate) showing the Ship to be classed in accordance with Clause 12.4(c).

(c)

(d)	a duly executed original of the Limited Liability Company Interests Security Deed (and of each document required to be delivered under the Limited Liability Company Interests Security Deed);

(e)	a Certified Copy of any executed External Management Agreement and any time charterparty in respect of the Ship;

(f)

(g)	A Certified Copy of the power of attorney pursuant to which the authorised signatory(ies) of the Borrower signed the documents referred to in this Clause 3.8 and to which the Borrower is a party and a specimen of his or their signature(s);

(h)

Immediately following the delivery of the Ship by the Builder to the Borrower, the Agent shall receive:

(i)	a duly executed original of the Mortgage;

(j)

(i)

the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.2(e) in so far as it relates to Oceania Cruises;

(ii)

the Limited Liability Company Interests Security Deed falls within the scope of Oceania Cruises’ corporate purpose as defined by its Articles of Incorporation and By-laws; and

(iii)

the representative of Oceania Cruises was at the date of the Limited Liability Company Interests Security Deed fully empowered to sign the Limited Liability Company Interests Security Deed.

(k)	an opinion from legal counsel to the Agent as to the law of the Maritime Registry confirming:

(i)

the valid registration of the Ship in the Maritime Registry; and

(ii)

the Mortgage over the Ship has been validly registered in the Maritime Registry;

(l)

(m)	the documents listed in Schedule 3.

4.	DRAWDOWN

4.1

Borrower’s irrevocable payment instructions. The Lenders shell not be obliged to fulfil their obligation to make the Loan available other than by paying the Builder all or part of 80% of the Final Contract Price up to the Eligible Amount on behalf of and in the name of the Borrower and by reimbursing the Agent for the instalment of the SACE Premium payable on the Delivery Date. The Borrower hereby instructs the Lenders in accordance with this Clause 4.1:

(a)	to pay to the Builder all or part of 80% of the Final Contract Price up to the Eligible Amount.

(b)	to pay to the Agent on behalf of the Lenders for onward payment to SACE (such payment to SACE to be made for value on the Drawdown Date), by drawing under the Loan, the amount of the second instalment of the related SACE Premium.

Save as contemplated in Clause 4.3 below, the payment instruction contained in this Clause 4.1 is irrevocable.

4.2

Conversion Rate for Loan. The Dollar amount to be drawn down under Clause 4.1(a) shall be calculated by the Agent on the Conversion Rate Fixing Date in accordance with the definitions of “Eligible Amount” and “Conversion Rate” in Clause 1.1.

4.3

Modification of payment terms. The Borrower expressly acknowledges that the payment terms set out in this Clause may only be modified with the agreement of the Builder, the Agent, the Lenders and the Borrower in the case of Clause 4.1(a) and with the agreement of the Agent, the Lenders and the Borrower in the case of Clause 4.1(b); Provided that it is the intention of the Borrower, the Lenders and the Agent that prior to the Delivery Date agreement shall be reached with those financial institutions with whom the Borrower has entered into the FOREX Contracts (the “ Counterparties ”) in order that the Euro payments due from the Counterparties under the FOREX Contracts shall be paid to the Agent for holding in escrow and to be released by the Agent simultaneously with (i) the payment in full to the Builder of the balance of the Final Contract Price denominated in Euro at the time of delivery of the Ship and (ii) the payment to the Counterparties of the

Dollars due to them under the relevant FOREX Contracts out of the Dollar amount available under Clause 4.1(a), subject only to delivery of the Ship by the Builder to the Borrower taking place as evidenced by the execution and delivery of the Protocol of Delivery and Acceptance and to the Borrower having deposited with the Agent before delivery, if and to the extent required, any Dollar and/or Euro amounts as may be needed to ensure the payment in full of both the balance of the Final Contract Price in Euro and the Dollars owed to the Counterparties under all the relevant FOREX Contracts.

4.4

Availability. Drawing may not be made under this Agreement (and the Loan shall not be available) after the earlier of the Delivery Date and the expiry of the Availability Period.

4.5

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 Loan and the Drawdown Date:

(b)	the amount of that Lender’s participation in the Loan; and

(c)	the duration of the first Interest Period.

4.6

Lenders to make available Contributions. Subject to the provisions of this Agreement, each Lender shall, on and with value on the Drawdown Date, make available to the Agent the amount due from that Lender under Clause 2.2.

4.7

Disbursement of Loan. Subject to the provisions of this Agreement, the Agent shall on the Drawdown Date pay the amounts which the Agent receives from the Lenders under Clause 4.6:

(a)	in the case of the amount referred to in Clause 4.1(a), to the account which the Borrower specifies in the Drawdown Notice;

(b)	in the case of the amount referred to in Clause 4.1(b) to the account of SACE which the SACE Agent shall specify; and

(c)	in the like funds as the Agent received the payments from the Lenders.

4.8

Disbursement of Loan to third party. The payment by the Agent under Clause 4.7 shall constitute the making of the Loan and the Borrower shall at that time become indebted, as principal and direct obligor, to each Lender in an amount equal to that Lender’s Contribution.

5.	REPAYMENT

5.1

Number of repayment instalments. The Borrower shall repay the Loan by twenty-four (24) consecutive six-monthly instalments.

5.2

Repayment Dates. The first instalment shall be repaid on the date falling six (6) months after the Drawdown Date and the last instalment on the date falling one hundred and forty four (144) months after the Drawdown Date, each date of payment of an instalment being a “ Repayment Date ”.

5.3

Amount of repayment instalments. Each of the twenty-four (24) consecutive six-monthly repayment instalments of the Loan shall be of an equal amount.

5.4

Final Repayment Date. On the final Repayment Date, the Borrower shall additionally pay to the Agent for the account of the Creditor Parties all other sums then accrued or owing under any Finance Document.

6.	INTEREST

6.1

Fixed Interest Rate. If the Borrower has specified a Fixed Interest Rate pursuant to Clause 3.5(b), the Loan shall bear interest at the CIRR. Such interest shall accrue on the actual number of days elapsed based upon a 360 day year and shall be paid on each Repayment Date.

6.2

Floating Interest Rate. If:

(a)	the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b); or

(b)	the Borrower has specified a Fixed Interest Rate pursuant to Clause 3.5(b) but thereafter for any reason whatsoever the Interest Make-up Agreement shall cease to be in effect,

6.3

Payment of Floating Interest Rate. Subject to the provisions of this Agreement, interest on the Loan in respect of each Interest Period shall accrue on the actual number of days elapsed based upon a 360 day year and shall be paid by the Borrower on the last day of that Interest Period.

6.4

Notification of Interest Periods and Floating Interest Rate. The Agent shall notify the Borrower and each Lender of each Floating Interest Rate and the duration of each Interest Period as soon as reasonably practicable after each is determined and no later than the Quotation Date.

6.5

Market disruption. The following provisions of this Clause 6 apply if:

(a)	No rate is quoted on “Reuters Page LIBOR 01” (or any other page replacing it) and the Lenders do not, before 1.00 p.m. (London time) on the Quotation Date for an Interest Period, provide quotations to the Agent in order to fix LIBOR; or

(b)

at least 1 Business Day before the start of an Interest Period, Lenders having Contributions together amounting to more than [*] per cent of the Loan (or, if the Loan has not been made, Commitments amounting to more than [*] per cent of the Total Commitments) notify the Agent that LIBOR fixed by the Agent would not accurately reflect the cost to those Lenders of funding their respective Contributions (or any part of them) during the Interest Period in the London Interbank Market at or about 11.00 a.m. (London time) on the Quotation Date for the Interest Period; or

(c)	at least 1 Business Day before the start of an Interest Period, the Agent is notified by a Lender (the “ Affected Lender ”) that for any reason it is unable to obtain Dollars in the London Interbank Market in order to fund its Contribution (or any part of it) during the Interest Period.

6.6

Notification of market disruption. The Agent shall promptly notify the Borrower and each of the Lenders stating the circumstances falling within Clause 6.5 which have caused its notice to be given.

6.7

Suspension of drawdown. If the Agent’s notice under Clause 6.5 is served before the Loan is made:

(a)	in a case falling within Clauses 6.5(a) or 6.5(b), the Lenders’ obligations to make the Loan;

(b)	in a case falling within Clause 6.5(c), the Affected Lender’s obligation to participate in the Loan;

shall be suspended while the circumstances referred to in the Agent’s notice continue.

6.8

Negotiation of alternative rate of interest. If the Agent’s notice under Clause 6.6 is served after the Loan 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 30 days after the date on, which the Agent serves its notice under Clause 6.6 (the “ Negotiation Period ”), an alternative interest rate or (at 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 Interest Period concerned.

6.9

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.

6.10

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 or (as the case may be), the Affected Lender, set an interest period and interest rate representing the cost of funding of the Lenders or (as the case may be) the Affected Lender in Dollars or in any available currency of their or its Contribution plus the Margin; and the procedure provided for by this Clause 6.10 shall be repeated if the relevant circumstances are continuing at the end of the interest period so set by the Agent.

6.11

Notice of prepayment. If the Borrower does not agree with an interest rate set by the Agent under Clause 6.10, the Borrower may give the Agent not less than 15 Business Days’ notice of its intention to prepay at the end of the interest period set by the Agent.

6.12

Prepayment; termination of Commitments. A notice under Clause 6.11 shall be irrevocable; the Agent shall promptly notify the Lenders or (as the case may require) the Affected Lender of the Borrower’s notice of intended prepayment; and:

(a)	on the date on which the Agent serves that notice, the Total Commitments or (as the case may require) the Commitment of the Affected Lender shall be cancelled; and

(b)	on the last Business Day of the interest period set by the Agent, the Borrower shall prepay (without premium or penalty) the Loan or, as the case may be, the Affected Lender’s Contribution, together with accrued interest thereon at the applicable rate plus the Margin.

6.13

Application of prepayment. The provisions of Clause 16 shall apply in relation to the prepayment.

7.	INTEREST PERIODS

7.1

Floating Interest Rate. This Clause 7 applies where the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b).

7.2

Commencement of Interest Periods. The first Interest Period shall commence on the Drawdown Date and each subsequent Interest Period shall commence on the expiry of the preceding Interest Period.

7.3

Duration of Interest Periods. Each Interest Period shall be 6 months and shall end on the next succeeding Repayment Date.

8.	CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS

8.1

Liability Preserved. The Borrower may not escape liability under the terms of this Agreement by opposing to the Lenders claims or defences of any kind

whatsoever arising under the Shipbuilding Contract, and in particular from its performance, or from any other relationship between the Borrower and the Builder.

9.	SACE PREMIUM AND ITALIAN AUTHORITIES

9.1

SACE Premium. The estimated SACE Premium is due and payable in two instalments as follows:

(a)

the first instalment of the SACE Premium shall be paid to SACE within 30 days of the issue of the SACE Insurance Policy documentation in the form required by Clause 3.3(b) of this Agreement and shall be in such amount in Dollars as is calculated by the Agent to be the equivalent of EUR [*] converted at the Base Rate (the “ First Instalment ”); and

(b)

9.2

Reimbursement by the Borrower of the SACE Premium. The Borrower irrevocably agrees to pay the First Instalment, and to instruct the Lenders to pay the Second Instalment on behalf of the Borrower, as follows:

(a)	The First Instalment shall be paid to SACE by the Borrower through the Agent upon notification by the Agent to the Borrower (i) of the issue of the SACE Insurance Policy documentation in the form required by Clause 3.3(b) of this Agreement, and (ii) of the amount of the First Instalment.

(b)	The Borrower has requested and the Lenders have agreed to finance the payment of [] per cent ([]%) of the Second Instalment on the Drawdown Date in accordance with Clause 2.1(b) of this Agreement.

9.3

Italian Authorities.

(a)	The Borrower acknowledges and agrees that the Agent and the Lenders are entitled to provide the Italian Authorities with any information they may have relative to the Loan and the business of the Group, to allow the Italian Authorities

to inspect all their records relating to this Agreement and the other Transaction Documents and to furnish them with copies thereof. Any such information relative to the Loan may also be given by any Italian Authorities to international institutions charged with collecting statistical data.

(b)

(c)	Each Party further undertakes not to act in a manner which is inconsistent with the terms of the SACE Insurance Policy.

9.4

Refund. In accordance with the SACE Policy, the Borrower has the right to receive a refund of the first instalment of the SACE Premium referred to in Clause 9.1(a), provided that no Event of Default has occurred, in the event that no drawings have been made under this Agreement and the parties have mutually decided to cancel the SACE Insurance Policy following cancellation of the Total Commitments in accordance with Clause 16.1. In these circumstances, the Borrower may request in writing through the SACE Agent, and shall be entitled to receive from SACE through the SACE Agent, a refund of the first instalment of the SACE Premium subject to a deduction for SACE’s administrative charges as calculated by SACE in an amount of not less than 15% of the refund or EUR 3,000 (calculated at the exchange rate valid at the date of the refund request) whichever is the higher.

In no event shall the SACE Agent be liable for any refund of the SACE Premium to be made by SACE.

10.

FEES

10.1

Fees. The following fees shall be paid to the Agent by the Borrower as required hereunder:

(a)	for the Mandated Lead Arrangers and the SACE Agent, an arrangement fee in an amount and payable at the time separately agreed in writing between the Mandated Lead Arrangers, the SACE Agent and the Borrower;

(b)

for the Lenders, a commitment fee in Dollars for the period from the date of this Agreement to the Delivery Date of the Ship, or the date of receipt by the Agent of the written cancellation notice sent by the Borrower as described in Clause 14.1, whichever is the earliest, computed at the rate of [*] per cent ([*]%) per annum and calculated on the undrawn amount of the Maximum Loan Amount and payable in arrears on the date falling six (6) months after the date of this Agreement and on each date falling at the end of each following consecutive six (6) month period, with the exception of the commitment fee due in respect of the last period, which shall be paid on the Drawdown Date, or the date of receipt by

the Agent of the written cancellation notice sent by the Borrower as described in Clause 16.1, whichever is the earliest, such commitment fee to be calculated on the actual number of days elapsed divided by three hundred and sixty (360);

For the purpose of the computation of the periodical commitment fee payable to the Lenders, the Maximum Loan Amount is assumed to be USD 608,082,164;

(c)	for the Agent, an agency fee of $[*] payable within ten (10) Business Days of the date of this Agreement and on or before each anniversary date thereof until total repayment of the Loan unless the Total Commitments are terminated pursuant to Clause 16.1.

11.

TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES

11.1

Warranty. The Creditor Parties each warrant to the Borrower that as at the date of this Agreement there are no Taxes payable in France as a consequence of the signature or performance of this Agreement (other than Taxes payable by each of the Lenders on its overall net income). Each of the Lenders specified in Schedule 1 undertakes that: (i) its Facility Office is located in France at the date of this Agreement; and (ii) it will not relocate its Facility Office to another jurisdiction if such relocation could result in the imposition of Taxes in connection with signature or performance of this Agreement (other than Taxes payable by a Lender on its overall net income), it being agreed, for the avoidance of doubt, that each Lender shall be entitled at any time to relocate its Facility Office to another jurisdiction provided that such relocation does not affect the tax status of the transaction for the Borrower by reference to the tax status that would apply were its Facility Office to be located in France.

11.2

Taxes. All Taxes legally payable (other than Taxes payable by each of the Lenders on its overall net income) as a consequence of the signature or performance of this Agreement shall he paid by the Borrower. In consequence, all payments of principal and interest, interest on late payments, compensation, costs, fees and related charges, due in connection with this Agreement shall be made without any deduction or withholding in respect of Taxes. The Borrower therefore hereby agrees expressly that if for any reason full payment of the above amounts is not made, it will immediately pay the Lenders the sums necessary to compensate exactly the effect of the deductions or withholdings made in respect of Taxes. If the Borrower fails to perform this obligation, the Lenders shall be entitled, in accordance with Clause 18, either not to make available the Loan or, as the case may require, to require immediate repayment of the Loan.

11.3

Increased Costs. If after the date of this Agreement by reason of:

(a)	any change in law or in its interpretation or administration; and/or

(b)	compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority including but without limitation the Basle Committee on Banking Regulations and Supervisory Practices whether or not having the force of law:

(i)

any of the Lenders incurs a cost as a result of its performing its obligations under this Agreement and/or its making available its Commitment hereunder; or

(ii)

(iii)

any of the Lenders incurs a cost as a result of its having entered into and/or its assuming or maintaining its commitment under this Agreement; or

(iv)

(v)

11.4

Transaction Costs. The Borrower undertakes to pay to the Agent, upon demand, all costs and expenses, duties and fees, including but without limitation agreed legal costs, out of pocket expenses and travel costs, incurred by the Mandated Lead Arrangers and the Lenders (but not including any bank which becomes a Lender after the date of this Agreement) in connection with the negotiation, preparation and execution of all agreements, guarantees, security agreements and related documents entered into, or to be entered into, for the purpose of the transaction contemplated hereby as well as all costs and expenses, duties and fees incurred by the Agent or the Lenders in connection with the registration, filing, enforcement or discharge of the said guarantees or security agreements, including without limitation the fees and expenses of legal advisers and insurance experts and the fees and expenses of SACE (including the fees and expenses of its legal advisers) payable by the Mandated Lead Arrangers to SACE, the cost of registration and discharge of security interests and the related travel and out of pocket expenses; the Borrower further undertakes to pay to the Agent all costs, expenses, duties and fees incurred by the Lenders and SACE in connection with any variation of this Agreement and the related documents, guarantees and security agreements, any supplements thereto and waiver given in relation thereto, in connection with the enforcement or preservation of any rights under this Agreement and/or the related guarantees and security agreements, including in each case the fees and expenses of legal advisers, and in connection with the consultations or proceedings made necessary or in the opinion of the Agent desirable by the acts of, or failure to act on the part of, the Borrower.

11.5

Costs of delayed Delivery Date. The Borrower undertakes to pay to the Agent, upon demand, any costs incurred by the Lenders in funding the Loan in the event

that the Delivery Date is later than the Intended Delivery Date unless the Borrower has given the Agent at least three (3) Business Days’ notification of such delay in the Delivery Date.

12.

REPRESENTATIONS AND WARRANTIES

12.1

Timing and repetition. The following applies in relation to the time at which representations and warranties are made and repeated:

(a)

(b)

the representations and warranties in Clause 12.3 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Finance Documents; and

(c)

12.2

Continuing representations and warranties. The Borrower represents and warrants to each of the Lenders that:

(a)

(b)

(c)

(d)	the entry into and performance of this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby do not and will not conflict with:

(i)

any law or regulation or any official or judicial order; or

(ii)

the constitutional documents of any Obligor; or

(iii)

any agreement or document to which any Obligor is a party or which is binding upon such Obligor or any of its assets,

(e)	except for:

(i)

the filing of UCC-1 Financing Statements against the Borrower in respect of those Financing Documents to which it is a party and which create Security Interests;

(ii)

the recording of the Mortgage in the office of the Maritime Administrator of the Republic of the Marshall Islands; and

(iii)

the registration of the Ship under an Approved Flag,

all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Agreement and each of the other Transaction Documents to which any Obligor is a party and the transactions contemplated thereby have been obtained or effected and are in full force and effect except authorisations, approvals, consents, licences, exemptions, filings and registrations required in the normal day to day course of the operation of the Ship and not already obtained by the Borrower;

(f)

(g)	each Obligor has fully disclosed to the Agent all facts relating to each Obligor which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into this Agreement;

(h)

the claims of the Creditor Parties against the Borrower under this Agreement will rank at least pari passu with the claims of all unsecured creditors of the Borrower (other than claims of such creditors to the extent that they are statutorily preferred) and in priority to the claims of any creditor of the Borrower who is also an Obligor;

(i)	the Borrower is and shall remain, after the advance to it of the Loan, solvent in accordance with the laws of the Marshall Islands and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof;

(j)

(k)

(l)	none of the Obligors nor any of their respective assets enjoys any right of immunity (sovereign or otherwise) from set-off, suit or execution in respect of their obligations under this Agreement or any of the other Transaction Documents or by any relevant or applicable law;

(m)

(n)

(o)

12.3

Semi-continuing representations and warranties. The Borrower represents and warrants to each of the Lenders that:

(a)

(b)	none of the assets or rights of the Borrower is subject to any Security Interest except any Security Interest which qualifies as a Permitted Security Interest with respect to the Borrower;

(c)	no litigation, arbitration or administrative proceedings are current or pending or, to its knowledge, threatened, which might, if adversely determined, have a material adverse effect on the ability of an Obligor to perform its obligations under the Transaction Documents to which it is a party;

(d)	to the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it;

(e)	each member of the Group has good and marketable title to all its assets which are reflected in the audited accounts referred to in Clause 12.2(k);

(f)	none of the Obligors has a place of business in any jurisdiction (except as already disclosed) which requires any of the Finance Documents to be filed or registered in that jurisdiction to ensure the validity of the Finance Documents to which it is a party;

(g)	each of the Obligors and each member of the Group:

(i)

navigable waters, water of the contiguous zone, ocean waters and international waters), including without limitation, laws, regulations, conventions and agreements relating to:

(A)

(B)

(ii)

(iii)

(A)

the presence or release or threat of release into the environment of any Material of Environmental Concern at any location, whether or not owned by such person; or

(B)

circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or Environmental Approval (“ Environmental Claim ”); and

there are no circumstances that may prevent or interfere with such full compliance in the future.

There is no material Environmental Claim pending or threatened against any of the Obligors or any member of the Group.

12.4

Representations on the Delivery Date. The Borrower further represents and warrants to each of the Lenders that on the Delivery Date the Ship will be:

(a)	in its absolute and unencumbered ownership save as contemplated by the Finance Documents;

(b)	registered in its name under the laws and flag of the Maritime Registry;

(c)	classed with the highest classification available for a Ship of its type free of all recommendations and qualifications with Lloyd’s Register, RINA or Bureau Veritas;

(d)	operationally seaworthy and in compliance with all relevant provisions, regulations and requirements (statutory or otherwise) applicable to ships registered under the laws and flag of the Maritime Registry;

(e)	in compliance with the ISM Code, the ISPS Code and Annex VI;

(f)	insured in accordance with the provisions of Clause 13.20 and in compliance with the requirements therein in respect of such insurances; and

(g)	managed by the Approved Manager and, in the event that the Approved Manager is not a member of the Group, on and subject to the terms set out in the External Management Agreement.

13.

UNDERTAKINGS

13.1

General. The Borrower undertakes with each Creditor Party to comply with the following undertakings during the Security Period.

13.2

Information. The Borrower will provide to the Agent for the benefit of the Lenders (or will procure the provision of):

(a)

(b)	as soon as practicable (and in any event within ninety (90) days of the commencement of each financial year) its budgetary forecast for the two following years;

(c)

(d)	promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group as the Agent may reasonably request for the benefit of the Creditor Parties; and

(e)

All accounts required under this Clause 13.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company.

13.3

Notification of default. The Borrower will notify the Agent of any Event of Default forthwith upon becoming aware of the occurrence thereof. Upon the Agent’s request from time to time the Borrower will issue a certificate stating whether any Obligor is aware of the occurrence of any Event of Default.

13.4

Consents and registrations. The Borrower will procure that (and will promptly furnish Certified Copies to the Agent on the request of the Agent of) all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it or any Obligor to perform its obligations under, and ensure the validity or enforceability of, each of the Transaction Documents are obtained and promptly renewed from time to time and will procure that the terms of the same are complied with at all times. Insofar as such filings or registrations have not been completed on or before the Drawdown Date the Borrower will procure the filing or registration within applicable time limits of each Finance Document which requires filing or registration together with all ancillary documents required to preserve the priority and enforceability of the Finance Documents.

13.5

Negative pledge. The Borrower will not create or permit to subsist any Security Interest on the whole or any part of its present or future assets, except for the following:

(a)	Security Interests created with the prior consent of the Agent; or

(b)	Security Interests qualifying as Permitted Security Interests with respect to the Borrower and described in paragraphs (a) and (b) of the definition of “Permitted Security Interests” in Clause 1.1; or

(c)	Security Interests qualifying as Permitted Security Interests with respect to the Borrower and described in paragraphs (c), (e), (h) or (i) of such definition, provided that insofar as they are enforceable against the Ship they do not prevail over the Mortgage.

13.6

Disposals. Except in the case of a sale of the Ship if the completion of the sale is contemporaneous with prepayment of the Loan in accordance with the provisions of Clause 16.3 and except for charters and other arrangements complying with Clause 13.12, the Borrower shall not without the consent of the Majority Lenders, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, sell, transfer, lease or otherwise dispose of the Ship or any of the Ship’s equipment except m the case of items being replaced or renewed provided that the net impact is not a reduction in the value of the Ship.

13.7

Change of business. Except with the prior consent of the Agent, the Borrower shall not make or threaten to make any substantial change in its business as presently conducted, namely that of a single ship owning company for the Ship, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the opinion of the Agent, the Borrower’s ability to perform its obligations hereunder.

13.8

Mergers. Except with the prior consent of the Lenders, the Borrower will not enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger or consolidation or anything analogous to the foregoing nor will it acquire any equity, share capital or obligations of any corporation or other entity.

13.9

Maintenance of status and franchises. The Borrower will do all such things as are necessary to maintain its limited liability company existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.

13.10

Financial records. The Borrower will keep proper books of record and account, in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Borrower in accordance with GAAP.

13.11

Financial indebtedness and subordination of indebtedness. The following restrictions shall apply:

(a)

(b)

interest or of any other costs, fees, expenses or liabilities arising from or representing such indebtedness. In this Clause 13.11(b) “fully subordinated” shall mean that any claim of the lender against the Borrower in relation to such indebtedness shall rank after and be in all respects subordinate to all of the rights and claims of the Creditor Parties under this Agreement and the other Finance Documents and that the lender shall not take any steps to enforce its rights to recover any monies owing to it by the Borrower and in particular but without limitation the lender will not institute any legal or quasi-legal proceedings under any jurisdiction at any time against the Ship, her Earnings or Insurances or the Borrower and it will not compete with the Creditor Parties or any of them in a liquidation or other winding-up or bankruptcy of the Borrower or in any proceedings in connection with the Ship, her Earnings or Insurances.

13.12

Pooling of earnings and charters. The Borrower will not without the prior written consent of the Agent enter into in respect of the Ship, nor permit to exist at any time following the Delivery Date:

(a)	any pooling agreement or other arrangement for the sharing of any of the Earnings or the expenses of the Ship except with a member of the Group and provided that it does not adversely affect the rights of the Creditor Parties under the Finance Documents in the reasonable opinion of the Agent; or

(b)

(i)

(ii)

(c)	any charter whereunder two (2) months’ charterhire (or the equivalent thereof) is payable in advance in respect of the Ship; or

(d)	any charter of the Ship or employment which, with the exercise of options for extension, could be for a period longer than [] ([]) months; or

(e)	any time charter of the Ship with a company outside the Group, provided however that such consent shall not be unreasonably withheld in the event that:

(i)

(ii)

13.13

Loans and guarantees by the Borrower. Otherwise than in the ordinary course of business in its ownership and operation of the Ship following the Delivery Date, the Borrower will not make any loan or advance or extend credit to any person, firm or corporation or issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation.

13.14

Management and employment. The Borrower will not as from the Delivery Date:

(a)	permit any person other than the Approved Manager to be the manager of, including providing crewing services to, the Ship, acting upon terms approved in writing by the Agent and having entered into:

(i)

(in the case of the Approved Manager) an Approved Manager’s Undertaking; and

(ii)

(in the case of the Borrower if the Approved Manager is not a member of the Group) an External Management Agreement Assignment;

(b)

(c)	permit the Ship to be employed other than within the Oceania brand.

13.15

13.16

hereafter) or any similar legislation applicable to the Ship in any other jurisdiction in which the Ship shall trade (a “ Relevant Jurisdiction ”) where the Ship trades in the territorial waters of the United States of America or a Relevant Jurisdiction.

13.17

Further assurance. The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to any of the Transaction Documents or the SACE Insurance Policy or securing to the Creditor Parties the full benefit of the rights, powers and remedies conferred upon the Creditor Parties or any of them in any such Transaction Document.

13.18

Valuation of the Ship. The following shall apply in relation to the valuation of the Ship:

(a)

(b)	the Borrower shall procure that forthwith upon the issuance of any valuation obtained pursuant to this Clause 13.18 a copy thereof is sent directly to the Agent for review; and

(c)	in the event that the Borrower fails to procure a valuation in accordance with Clause 13.1(a), the Agent shall be entitled to procure a valuation of the Ship on the same basis.

13.19

Earnings. The Borrower will procure that the Earnings (if any) are paid in full without set off and free and clear and without deduction for any taxes levies duties imposts charges fees restrictions or conditions of any nature whatsoever.

13.20

Insurances. The Borrower covenants with the Creditor Parties and undertakes with effect from the Delivery Date until the end of the Security Period:

(a)

to insure the Ship in its name and keep the Ship insured on an agreed value basis for an amount in the currency in which the Loan is denominated approved by the Agent but not being less than the greater of (x) [*] per cent ([*]%) of the amount of the Loan; and (y) the full market and commercial value of the Ship determined in accordance with Clause 13.18 from time to time through internationally recognised independent first class insurance companies, underwriters, war risks and protection and indemnity associations acceptable to the Agent in each instance on terms and conditions approved by the Agent including as to deductibles but at least in respect of:

(i)

(ii)

war risks and war risks (protection and indemnity) up to the insured amount;

(iii)

(iv)

(v)

when and while the Ship is laid-up, in lieu of hull insurance, normal port risks; and

(vi)

such other risks as the Agent may from time to time reasonably require;

(b)

that the Agent shall take out mortgagee interest insurance on such conditions as the Agent may reasonably require and mortgagee interest insurance for pollution risks as from time to time agreed each for an amount in the currency in which the Loan is denominated of [*] per cent ([*]%) of the amount of the Loan, the Borrower having no interest or entitlement in respect of such policies; the Borrower shall upon demand of the Agent reimburse the Agent for the costs of effecting and/or maintaining any such insurance(s);

(c)

if the Ship shall trade in the United States of America and/or the Exclusive Economic Zone of the United States of America (the “ EEZ ”) as such term is defined in the US Oil Pollution Act 1990 (“ OPA ”), to comply strictly with the requirements of OPA and any similar legislation which may from time to time be enacted in any jurisdiction in which the Ship presently trades or may or will trade at any time during the existence of this Agreement and in particular before such trade is commenced and during the entire period during which such trade is carried on:

(i)

to pay any additional premiums required to maintain protection and indemnity cover for oil pollution up to the limit available to it for the Ship in the market;

(ii)

(iii)

(iv)

(v)

(vi)

(vii)

(d)	to give notice forthwith of any assignment of its interest in the Insurances to the relevant brokers, insurance companies, underwriters and/or associations in the form approved by the Agent;

(e)

(f)	to procure that each of the relevant brokers and associations furnishes the Agent with a letter of undertaking in such form as may be required by the Agent and waives any lien for premiums or calls except in relation to premiums or calls solely attributable to the Ship;

(g)	punctually to pay all premiums, calls, contributions or other sums payable in respect of the Insurances on the Ship and to produce all relevant receipts when so required by the Agent;

(h)

(i)	to arrange for the execution of such guarantees as may from time to time be required by any protection and indemnity and/or war risks association;

(j)	to furnish the Agent from time to time on request with full information about all Insurances maintained on the Ship and the names of the offices, companies, underwriters, associations or clubs with which such Insurances are placed;

(k)

(l)	not to settle, compromise or abandon any claim in respect of any of the Insurances on the Ship other than a claim of less than [] Dollars ($[]) or the equivalent in any other currency and not being a claim arising out of a Total Loss;

(m)	to apply or ensure the appliance of all such sums receivable in respect of the Insurances on the Ship for the purpose of making good the loss and fully repairing all damage in respect whereof the insurance monies shall have been received;

(n)

(o)

13.21

Operation and maintenance of the Ship. From the Delivery Date until the end of the Security Period at its own expense the Borrower will:

(a)

keep the Ship in a good and efficient state of repair so as to maintain it to the highest classification notation available for the Ship of its age and type free of all recommendations and qualifications with Lloyd’s Register, RINA or Bureau Veritas. On the Delivery Date and annually thereafter, it will furnish to the Agent a statement by such classification society that such classification notation is maintained. It will comply with all recommendations, regulations and requirements (statutory or otherwise) from time to time applicable to the Ship and shall have on board as and when required thereby valid certificates showing compliance therewith and shall procure that all repairs to or replacements of any damaged, worn or lost parts or equipment are carried out (both as regards workmanship and quality of materials) so as not to diminish the value or class of the Ship. It will not make any substantial modifications or alterations to the Ship or any part thereof which would reduce the market and commercial value of the Ship determined in accordance with Clause 13.18;

(b)	submit the Ship to continuous survey in respect of its machinery and hull and such other surveys as may be required for classification purposes and, if so required by the Agent, supply to the Agent copies in English of the survey reports;

(c)	permit surveyors or agents appointed by the Agent to board the Ship at all reasonable times to inspect its condition or satisfy themselves as to repairs proposed or already carried out and afford all proper facilities for such inspections;

(d)

(i)

(ii)

provide the Agent with copies of any such Document of Compliance and Safety Management Certificate as soon as the same are issued; and

(iii)

keep, or procure that there is kept, on board the Ship a copy of any such Document of Compliance and the original of any such Safety Management Certificate;

(e)

(i)

keep, or procure that there is kept, on board the Ship the original of the International Ship Security Certificate required by the ISPS Code; and

(ii)

keep, or procure that there is kept, on board the Ship a copy of the ship security plan prepared pursuant to the ISPS Code;

(f)	comply with Annex VI (as the same may be amended from time to time) or any replacement of Annex VI (as the same may be amended from time to time) and in particular, without limitation, to:

(i)

(procure that the Ship’s master and crew are familiar with, and that the Ship complies with Annex VI; and

(ii)

maintain for the Ship throughout the Security Period a valid and current IAPPC and provide a copy to the Agent; and

(iii)

notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the IAPPC;

(g)

(h)

(i)	give notice to the Agent promptly and in reasonable detail upon the Borrower or any other Obligor becoming aware of:

(i)

accidents to the Ship involving repairs the cost of which will or is likely to exceed [*] Dollars ($[*]);

(ii)

the Ship becoming or being likely to become a Total Loss;

(iii)

(iv)

any writ or claim served against or any arrest of the Ship or the exercise of any lien or purported lien on the Ship, her Earnings or Insurances;

(v)

the Ship ceasing to be registered under the flag of the Maritime Registry or anything which is done or not done whereby such registration may be imperilled;

(vi)

it becoming impossible or unlawful for it to fulfil any of its obligations under the Finance Documents; and

(vii)

anything done or permitted or not done in respect of the Ship by any person which is likely to imperil the security created by the Finance Documents;

(j)

aforesaid which are being contested in good faith subject always that full details of any such contested debt, damage or liability which, either individually or in aggregate exceeds [*] Dollars ($[*]) shall forthwith be provided to the Agent. As and when the Agent may so require the Borrower will make such books available for inspection on behalf of the Agent and provide evidence satisfactory to the Agent that the wages and allotments and the insurance and pension contributions of the master and crew are being regularly paid, that all deductions of crew’s wages in respect of any tax liability are being properly accounted for and that the master has no claim for disbursements other than those incurred in the ordinary course of trading on the voyage then in progress or competed prior to such inspection;

(k)

(l)

promptly pay and discharge all liabilities which have given rise, or may give rise, to liens or claims enforceable against the Ship under the laws of all countries to whose jurisdiction the Ship may from time to time be subject and in particular the Borrower hereby agrees to indemnify and hold the Creditor Parties, their successors, assigns, directors, officers, shareholders, employees and agents harmless from and against any and all claims, losses, liabilities, damages, expenses (including attorneys, fees and expenses and consultant fees) and injuries of any kind whatsoever asserted against the Creditor Parties, with respect to or as a result of the presence, escape, seepage, spillage, release, leaking, discharge or migration from the Ship or other properties owned or operated by the Borrower of any hazardous substance, including without limitation, any claims asserted or arising under any applicable environmental, health and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder of all governmental agencies, regardless of whether or not caused by or within the control of the Borrower subject to the following:

(i)

(ii)

unless and until an Event of Default shall have occurred and without prejudice to the right of each Lender to be indemnified pursuant to this Clause 13.21(1):

(A)

(B)

(m)

(n)	maintain the registration of the Ship under and fly the flag of the Maritime Registry and not do or permit anything to be done whereby such registration may be forfeited or imperilled.

13.22

Irrevocable payment instructions. The Borrower shall modify, revoke or withhold the payment instructions set out in Clause 4.1 without the agreement of the Builder (in the case of Clause 4.1(a) only), the Agent and the Lenders.

13.23

“Know your customer” checks. If:

(a)	the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;

(b)	any change in the status of a Borrower after the date of this Agreement; or

(c)

a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer, obliges the Agent or any Lender (or, in the case of Clause 13.23(c), 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, the Borrower 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 Clause 13.23(c), on behalf of any prospective new Lender) in order for the Agent and, such Lender or 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.

13.24

Shipbuilding Contract. The Borrower shall not modify the Shipbuilding Contract, directly or indirectly, if, by reason of regulations which apply to a Lender, such modification would make such Lender’s Commitment impossible to fulfil or would change the substance or form of its Commitment. The Borrower will, therefore, submit to the Agent any proposals for modification which, in its opinion, might have such a consequence, and the Agent on behalf of the Lenders will indicate in a timely manner whether the modification proposed will allow the Loan to be maintained. On or about the last day of each successive period of three (3) months commencing on the date of this Agreement and on the date of the Drawdown Notice, the Borrower undertakes to provide the Agent with a copy of any Change Order entered into during that three (3) month or other period. The Borrower also undertakes to notify the Agent of any change in the Intended Delivery Date as soon as practicable after each change has occurred.

13.25

FOREX Contracts. The Borrower shall

(a)	provide the Agent with a copy of all FOREX Contracts together with all relevant details with ten (10) days of their execution; and

(b)	inform the Agent, when requested by the Agent, of its intended hedging policy for purchasing Euro with Dollars.

14.

SECURITY VALUE MAINTENANCE

14.1

Security Shortfall. If, upon receipt of a valuation of the Ship in accordance with Clause 13.18, the Security Value shall be less than the Security Requirement, the Agent may give notice to the Borrower requiring that such deficiency be remedied and then the Borrower shall (unless the Ship has become a Total Less) either:

(a)

(b)

within 30 days of the data of receipt by the Borrower of the Agent’s said notice constitute to the reasonable satisfaction of the Agent such further security of the Loan as shall be reasonably acceptable to the Agent having a value for security purposes (as determined by the Agent in its absolute discretion) at the date upon which such further security shall be constituted which, when added to the Security Value, shall not be less than the Security Requirement as at such date.

Clauses 14.2 and 14.4 shall apply to prepayments under Clause 14.1(a).

14.2

Costs. All costs in connection with the Agent obtaining any valuation of the Ship referred to in Clause 13.18, and obtaining any valuation either of any additional security for the purposes of ascertaining the Security Value at any time or necessitated by the Borrower electing to constitute additional security pursuant to Clause 14.1(b) shall be borne by the Borrower.

14.3

Valuation of additional security. For the purpose of this Clause 14, the market value of any additional security provided or to be provided to the Agent shall be determined by the Agent in its absolute discretion without any necessity for the Agent assigning any reason thereto.

14.4

Documents and evidence. In connection with any additional security provided in accordance with this Clause 14, the Agent shall be entitled to receive such evidence and documents of the kind referred to in Clause 3 in respect of other Finance Documents as may in the Agent’s opinion be appropriate.

14.5

Cash or a letter of credit as additional security. For all purposes under this Clause 14, it is agreed and understood that:

(a)	cash or a letter of credit shall be an acceptable form of security provided that in the case of a letter of credit it is issued on such terms and by such first class bank as shall have been approved in writing by the Agent (acting in its reasonable discretion); and

(b)	the value of such cash for security purposes shall be equal to the amount of such cash and the value of such letter of credit for security purposes shall be equal to its stated amount.

15.

LETTER OF CREDIT PROVISIONS

15.1

Letter of Credit Option. The Borrower shall have the option of procuring the issue and delivery to the Agent (acting on behalf of the Lenders) by the Letter of Credit Issuer of the Letter of Credit (thereby avoiding a reduction in the Eligible Amount as a result of the Letter of Credit not being issued), such option to be exercised by fulfilling the following conditions:

(a)	the Letter of Credit shall be delivered to the Agent not later than the Letter of Credit Issue Date; and

(b)

15.2

Drawings under Letter of Credit. The Agent shall be entitled to demand payment under the Letter of Credit (if issued pursuant to Clause 15.1) by delivering to the Letter of Credit Issuer in accordance with the provisions of the Letter of Credit.

(a)	a drawing certificate substantially in the form of Exhibit A to the Letter of Credit following the occurrence of an Event of Default; and

(b)

15.3

Application of drawings under Letter of Credit. All sums received by the Agent in respect of a drawing under the Letter of Credit (if issued pursuant to Clause 15.1) shall:

(a)	in the case of a drawing in the circumstances described in Clause 15.2(a), be applied by the Agent in accordance with Clause 19; or

(b)

in the case of a drawing in the circumstances described in Clause 15.2(b), be applied by the Agent in accordance with Clause 19 unless the Agent, acting with the authority of the Majority Lenders, agrees that such sums may be deposited into a cash collateral account pledged by the Borrower in favour of the Agent on terms reasonably acceptable to the Agent.

15.4

Release Certificate. The Agent undertakes with the Borrower to cause the Letter of Credit (if issued pursuant to Clause 15.1) to be entirely cancelled promptly upon the occurrence of any event specified in paragraphs (a), (b), (c), (d) or (e) below (each a “ Letter of Credit Release Event ”):

(a)	all indebtedness incurred under this Agreement has been repaid and/or paid in full; or

(b)	an amount equal to the stated amount of the Letter of Credit has been deposited into a cash collateral account pledged by an Obligor in favour of the Agent on terms reasonably acceptable to the Agent; or

(c)	pursuant to the sale of Prestige Holdings or one of more of its subsidiaries, the Agent has received a replacement letter of credit or other security on terms reasonably acceptable to the Agent; or

(d)

(e)	this Agreement has been terminated for any reason prior to the Delivery Date.

16.

CANCELLATION AND PREPAYMENT

16.1

Cancellation. At any time prior to the delivery of a Drawdown Notice and not less than ninety (90) Business Days prior to the Intended Delivery Date, the Borrower may give notice to the Agent in writing that it wishes to cancel the Total Commitments in their entirety whereupon (without penalty to the Borrower but without prejudice to any liabilities of the Borrower including, without limitation, in respect of fees payable or accrued under this Agreement, arising prior to the date of such cancellation) the Total Commitments shall terminate upon the date specified in such notice.

16.2

Voluntary prepayment. The Borrower may prepay all or part of the Loan (but if in part being an amount that reduces the Loan by a minimum amount of one (1) repayment instalment of principal of the Loan) together with interest thereon without penalty provided the prepayment is made on the last day of an Interest Period and three (3) month’s prior written notice indicating the intended date of prepayment is given to the Agent and the SACE Agent, but the following amounts shall be payable to the Agent for the account of the Lenders or the Italian Authorities in the sum of:

(a)

if the Borrower has specified a Floating Interest Rate pursuant to Clause 3.5(b), the difference (if positive), calculated by the Lenders and notified by them to the Agent, between the actual cost for the Lenders of the funding for the Loan and the rate of interest for the monies to be invested by the Lenders, applied to the amounts so prepaid for the period from the said prepayment until the last day of the Interest Period during which the prepayment occurs (if prepayment does not occur on the last day of that Interest Period), details of any such calculation being supplied to the Borrower by the Agent on behalf of the Lenders; or

(b)	if the Borrower has selected the Fixed Interest Rate pursuant to Clause 3.5(b), the charges (if any) imposed on the Lenders by the Italian Authorities representing funding or breakage costs of the Italian Authorities.

16.3

Mandatory prepayment. The Borrower shall be obliged to prepay the whole of the Loan if:

(a)	the Ship is sold or becomes a Total Loss:

(i)

in the case of a sale, on or before the date on which the sale is completed by delivery of the Ship to the buyer; or

(ii)

in the case of a Total Loss, on the earlier of the date falling 120 days after the Total Loss Date and the date of receipt by the Agent of the proceeds of insurance relating to such Total Loss; or

(b)	the SACE Insurance Policy is modified, suspended, terminated or rescinded unless caused by the wilful misconduct or gross negligence of a Creditor Party.

16.4

Other amounts. Any prepayment of the whole of the Loan shall he made together with all other sums due under this Agreement (including, without limitation, the compensation calculated in accordance with Clause 16.2).

16.5

Application of partial prepayment. Amounts prepaid shall be applied in accordance with Clause 19.1(b).

16.6

No reborrowing. Amounts prepaid may not be reborrowed.

17.

INTEREST ON LATE PAYMENTS

17.1

Default rate of interest. Without prejudice to the provisions of Clause 18 and without this Clause in any way constituting a waiver of terms of payment, all sums due by the Borrower under this Agreement will automatically bear interest on a day to day basis from the date when they are payable until the date of actual payment at a rate per annum equal to the higher of:

(a)	where the Floating Interest Rate is applicable, the aggregate of:

(i)

Overnight LIBOR;

(ii)

the Margin; and

(iii)

[*] per cent ([*]%) per annum; or

(b)	where the Fixed Interest Rate is applicable, the higher of:

(i)

the CIRR plus [*] per cent ([*]%) per annum; and

(ii)

Overnight LIBOR plus the Margin plus [*] per cent ([*]%) per annum.

17.2

Compounding of default interest. Any such interest will itself bear interest at the above rate if it is due for at least three (3) months and thereafter at three monthly intervals.

18.

EVENTS OF DEFAULT

18.1

Events of Default. An Event of Default occurs if any of the events or circumstances described in Clause 18.2 to 18.21 occur provided that if, at any time during the period commencing on the day after the date of this Agreement and ending on the date falling ninety (90) days before the intended Delivery Date (the “ Restriction Period ”), an event should occur that would constitute an Event of Default, the Agent shall not be entitled to serve any notice under Clause 18.22(a) during the Restriction Period unless the relevant event consists of:

(a)	a failure by the Borrower to comply with the provisions of Clauses 13.5, 13.6, 13.8 or 13.13;

(b)	the happening of any of the events specified in Clauses 18.2, 18.7, 18.8, 18.9, 18.10, 18.11, 18.12 or 18.13;

(c)	the repudiation or termination of the Shipbuilding Contract.

However, this provision shall not he interpreted as a waiver of:

(i)

the Agent’s right to serve any notice under Clause 18.22(a) in respect of any Event of Default that has occurred and that remains unremedied on the last day of the Restriction Period; or

(ii)

18.2

Non-payment. Any Obligor fails to pay when due or (if so payable) on demand any sum payable under a Finance Document or under any document relating to a Finance Document and such failure is not remedied within three (3) Business Days of the due date or (if payable on demand) within three (3) Business Days of receiving the demand.

18.3

Non-remediable breaches. The Borrower fails to comply with the provisions of Clauses 13.5, 13.6, 13.8 or 13.13.

18.4

Breach of other obligations.

(a)

Any Obligor fails to comply with any prevision of any Finance Document (other than a failure to comply covered by any of the other provisions of Clauses 18.2 to 18.21) and in particular but without limitation either of the Guarantors fails to comply with the provisions of Clause 11 (Undertakings) of its Guarantee or there is any breach in the sole opinion of the Agent of any of the Underlying Documents provided that no Event of Default shall be deemed to have occurred if in the opinion of the Agent in its sole discretion, such failure or breach is capable of remedy and is remedied within the Relevant Period (as defined below) from the date of its occurrence, if the failure was known to that Obligor, or from the date the relevant Obligor is notified by the Agent of the failure, if the failure was not known to that Obligor, unless in any such case as aforesaid the Agent in its sole discretion considers that the failure or breach is or could reasonably be expected to become materially prejudicial to the interests, rights or position of the Lenders, “ Relevant Period ” meaning for the purposes of this Clause thirty (30) days in respect of a remedy period commencing under this Clause not later than 30 September 2009 and fifteen (15) days in respect of a remedy period commencing after 30 September 2009; or

(b)	If there is a repudiation or termination of any Transaction Document or if any of the parties thereto becomes entitled to terminate or repudiate any of them and evidences an intention so to do.

18.5

Misrepresentation. Any representation, warranty or statement made or repeated in, or in connection with, any Transaction Document or the SACE Insurance Policy or in any accounts, certificate, statement or opinion delivered by or on behalf of any Obligor thereunder or in connection therewith is materially incorrect or misleading when made or would, if repeated at any time hereafter by reference to the facts subsisting at such time, no longer be materially correct.

18.6

Cross default.

(a)	Any event of default occurs under any financial contract or financial document relating to any Financial Indebtedness of the Borrower; or

(b)	any such Financial Indebtedness or any sum payable in respect thereof is not paid when due (after the expiry of any applicable grace period(s)) whether by acceleration or otherwise; or

(c)

(d)

18.7

Winding-up. Any order is made or an effective resolution parsed or other action taken for the suspension of payments or reorganisation, dissolution, termination of existence, liquidation, winding-up or bankruptcy of any Obligor.

18.8

Moratorium or arrangement with creditors. A moratorium in respect of all or any debts of any Obligor or a composition to an arrangement with creditors of any Obligor or any similar proceeding or arrangement by which the assets of any Obligor are submitted to the control of its creditors is applied for, ordered or declared or any Obligor commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of all or a significant part of its Financial Indebtedness.

18.9

Appointment of liquidators etc. A liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer is appointed in respect of any Obligor or in respect of all or any substantial part of the assets of any Obligor.

18.10

Insolvency. Any Obligor becomes or is declared insolvent or is unable, or admits in writing its inability, to pay its debts as they fall due or becomes insolvent within the terms of any applicable law.

18.11

Legal process. Any distress, execution, attachment or other process affects the whole or any substantial part of the assets of any Obligor and remains undischarged for a period of thirty (30) days or any uninsured judgment in excess of [*] Dollars ($[*]) following final appeal remains unsatisfied for a period of ten (10) days.

18.12

Analogous events. Anything analogous to or having a substantially similar effect to any of the events specified in Clauses 18.7 to 18.11 shall occur under the laws of any applicable jurisdiction.

18.13

Cessation of business. Any Obligor ceases to carry on all or a substantial part of its business.

18.14

Revocation of consents. Any authorisation, approval, consent, license, exemption, filing, registration or notarisation or other requirement necessary to enable any Obligor to comply with any of its obligations under any of the Transaction Documents is materially adversely modified, revoked or withheld or

does not remain in full force and effect and within ninety (90) days of the date of its occurrence such event is not remedied to the satisfaction of the Agent and the Agent considers in its sole discretion that such failure is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the modification, revocation or withholding of the authorisation, approval or consent is due to an act or omission of any Obligor and the Agent is satisfied in its sole discretion that the Lenders’ interests might reasonably be expected to be materially adversely affected.

18.15

Unlawfulness. At any time it is unlawful or impossible for any Obligor to perform any of its material (to the Creditor Parties or any of them) obligations under any Transaction Document to which it is a party or it is unlawful or impossible for the Creditor Parties or any Lender to exercise any of their or its rights under any of the Transaction Documents provided that no Event of Default shall be deemed to have occurred where the unlawfulness or impossibility does not relate to the payment obligation of any Obligor under any Transaction Document and is cured within the period of twenty one (21) days of the date of occurrence of the event giving rise to the unlawfulness or impossibility and the affected Obligor performs it obligation within such period.

18.16

Insurances. The Borrower fails to insure the Ship in the manner specified in Clause 13.20 or fails to renew the Insurances at least five (5) days prior to the date of expiry thereof and produce prompt confirmation of such renewal to the Agent provided that if the insurers withdraw their cover an Event of Default shall be deemed to have occurred upon Issue of the insurer’s notice of withdrawal.

18.17

Disposals. If the Borrower or any other Obligor shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor with the intention of preferring such creditor over any other creditor.

18.18

Prejudice to security. Anything is done or suffered or omitted to be done by any Obligor which in the reasonable opinion of the Agent would or might be expected to imperil the security created by any of the Finance Documents.

18.19

Governmental intervention. The authority of any Obligor in the conduct of its business is wholly or substantially curtailed by any seizure or intervention by or on behalf of any authority and within ninety (90) days of the date of its occurrence any such seizure or intervention is not relinquished or withdrawn and the Agent reasonably considers that the relevant occurrence is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the seizure or intervention executed by any authority is due to

an act or omission of any Obligor and the Agent is satisfied, in its sole discretion, that the Lenders’ interest might reasonably be expected to be materially adversely affected.

18.20

Letter of Credit. There shall occur a Letter of Credit Event of Default.

18.21

Other Loan Agreement. There shall occur an Event of Default (under and as defined in the Other Loan Agreement).

18.22

Actions following an Event of Default. On, or at any time after, the occurrence of an Event of Default the Agent may, and if so instructed by the Majority Lenders, the Agent shall:

(a)	serve on the Borrower a notice stating that the Commitments and all other obligations of each Lender to the Borrower under this Agreement are terminated; and/or

(b)

serve on the Borrower a notice stating that the Loan (including but without limitation the amount representing the financed second installment of the SACE Premium), 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

(c)	take any other action which, as a result of the Event of Default or any notice served under paragraph (a) or (b), the Agent and/or the Lenders are entitled to take under any Finance Document or any applicable law including (without limitation) making a call under the Letter of Credit.

18.23

Termination of Commitments. On the service of a notice under Clause 18.22(a), the Commitments and all other obligations of each Lender to the Borrower under this Agreement shall terminate.

18.24

Acceleration of Loan. On the service of a notice under Clause 18.22(b), the Loan, all accrued interest and all other amounts accrued or owing from the Borrower or any Obligor under this Agreement and every other Finance Document shall become immediately due and payable or, as the case may be, payable on demand.

18.25

Further amounts payable. Upon an acceleration of repayment of the Loan following an Event of Default the Borrower shall be liable to pay compensation calculated in accordance with Clause 16.2.

18.26

Multiple notices; action without notice. The Agent may serve notices under Clauses 18.22(a) and (b) simultaneously or on different dates and it may take any action referred to in Clause 18.22(c) if no such notice is served or simultaneously with or at any time after the service of both or either of such notices.

18.27

Notification of Creditor Parties and Obligors. The Agent shall send to each Lender and each Obligor a copy or the text of any notice which the Agent serves on the Borrower under Clause 18.22; but the notice shall become effective when it is served on the Borrower, 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 Obligor with any form of claim or defence.

18.28

Lender’s rights unimpaired. Nothing in this Clause 18 shall be taken to impair or restrict the exercise of any right given to individual Lenders under a Finance Document or the general law; and, in particular, this Clause is without prejudice to Clauses 2.4 and 2.5.

18.29

Exclusion of Creditor Party liability. No Creditor Party, and no receiver or manager appointed by the Agent, shall have any liability to an Obligor:

(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.

19.

APPLICATION OF SUMS RECEIVED

19.1

Receipts. Except as any Finance Document may otherwise provide, all sums received under this Agreement or any other Finance Document by the Agent, on behalf of the Lenders, or by any of the Lenders for any reason whatsoever will be applied:

(a)

(b)

20.

INDEMNITIES

20.1

Indemnities regarding borrowing and repayment of Loan. The Borrower shall fully indemnify the Agent and each Lender on the Agent’s 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)	the Loan 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 Borrower 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 Borrower on the amount concerned under Clause 17);

(d)	the occurrence and/or continuance of an Event of Default and/or the acceleration of repayment of the Loan under Clause 18;

20.2

Breakage costs. Without limiting its generality, Clause 20.1 covers (i) any claim, expense, liability or loss, including a loss of a prospective profit, incurred by a Lender 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 (ii) if the Borrower has selected the Fixed Interest Rate in accordance with Clause 3.5(b), any funding or breakage costs imposed by SIMEST as a consequence of (x) any total or partial prepayment of the Loan and/or (y) the Borrower deciding to switch from the Fixed Interest Rate to another interest rate after the Drawdown Date and/or (z) the Interest Make-up Agreement ceasing for any reason to be in effect; any such costs imposed by SIMEST shall be paid by the Borrowers to SIMEST through the Agent.

20.3

Miscellaneous indemnities. The Borrower 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 or any other Creditor Party or by any receiver appointed under a Finance Document;

(b)	any other Pertinent Matter,

20.4

Currency indemnity. If any sum due from an Obligor 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 an Obligor, 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 Borrower 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.

20.5

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 20 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.

20.6

Sums deemed due to a Lender. For the purposes of this Clause 20, a sum payable by the Borrower to the Agent for distribution to a Lender shall be treated as a sum due to that Lender.

21.

ILLEGALITY, ETC

21.1

Illegality. This Clause 21 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,

for the Notifying Lender to maintain or give effect to any of its obligations under this Agreement in the manner contemplated by this Agreement.

21.2

Notification of illegality. The Agent shall promptly notify the Borrower, the Obligors and the other Lenders of the notice under Clause 21.1 which the Agent receives from the Notifying Lender.

21.3

Prepayment; termination of Commitment. On the Agent notifying the Borrower under Clause 21.2, the Notifying Lender’s Commitment shall terminate; and thereupon or, if later, on the date specified in the Notifying Lender’s notice under Clause 21.1 as the date on which the notified event would become effective the Borrower shall prepay the Notifying Lender’s Contribution and shall pay compensation to the Notifying Lender calculated in accordance with Clause 16.2.

22.

SET-OFF

22.1

Application of credit balances. Each Creditor Party may without prior notice:

(a)

(b)	for that purpose:

(i)

break, or alter the maturity of, all or any part of a deposit of the Borrower;

(ii)

convert or translate all or any part of a deposit or other credit balance into Dollars;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

22.2

Existing rights unaffected. No Creditor Party shall be obliged to exercise any of its rights under Clause 22.1; 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).

22.3

Sums deemed due to a Lender. For the purposes of this Clause 22, a sum payable by the Borrower to the Agent 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.

22.4

No Security Interest. This Clause 22 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 the Borrower.

23.

CHANGES TO THE LENDERS

23.1

Assignments and transfers by the Lenders. Subject to this Clause 23 and the prior written consent of the Italian Authorities having been obtained, a Lender (the “ Existing Lender ”) may:

(a)	assign its rights; or

(b)	transfer by novation its rights and obligations, to another bank or financial institution (the “ New Lender ”).

23.2

Conditions of assignment or transfer.

(a)	The consent of the Borrower is required for an assignment or transfer by an Existing Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender.

(b)	The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed.

(c)	The assignment or transfer must be with respect to a minimum Commitment of [] Dollars ($[]) or, if less, the Existing Lender’s full Commitment.

(d)	An assignment will only be effective on:

(i)

(ii)

23.3

Assignment or transfer fee. The New Lender shall:

(a)	on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of [] Euro (EUR []);

(b)

(c)	pay to the Agent, upon demand, such amount as is payable to the Italian Authorities to cover its costs of giving its approval under Clause 23.1.

23.4

Limitation of responsibility of Existing Lenders.

(a)	Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:

(i)

the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents or any other documents;

(ii)

the financial condition of any Obligor;

(iii)

the performance and observance by any Obligor of its obligations under the Finance Documents or any other documents; or

(iv)

the accuracy of any statements (whether written or oral) made in or in connection with any Finance Document or any other document,

and any representations or warranties implied by law are excluded.

(b)	Each New Lender confirms to the Existing Lender and the other Creditor Parties that it:

(i)

(ii)

(c)	Nothing in any Finance Document obliges an Existing Lender to:

(i)

accept a re-transfer from a New Lender of any of the rights and obligations assigned or transferred under this Clause 23; or

(ii)

support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Finance Documents or otherwise,

23.5

Permitted disclosure. Any Creditor Party may disclose to any of its Affiliates and to the following other persons:

(a)	any person with (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement;

(b)	any person to (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or any Obligor;

(c)	any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;

(d)	any other Creditor Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;

(e)	or any employee, officer, director or representative of any Italian Authorities which needs to know such information or receive such document in the course of such person’s employ or duties;

(f)	a Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or

(g)

auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information, any information about any Obligor, this Agreement and the other Finance Documents as that Creditor Party shall consider appropriate. Each of the Creditor Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Agreement and the other Finance Documents as that Creditor Party reasonably considers normal practice for an export credit.

23.6

Assignment or transfer to SACE. Notwithstanding the above provisions of this Clause 23:

(a)

(b)

24.

CHANGES TO THE OBLIGORS

24.1

No change without consent. No Obligor may assign any of its rights or transfer any of its rights or obligations under the Finance Documents.

25.

ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS

25.1

Appointment of the Agent.

(a)	Each other Creditor Party appoints the Agent to act as its agent under and in connection with this Agreement and the other Finance Documents and the SACE Insurance Policy.

(b)	Each other Creditor Party authorises the Agent 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.

25.2

Duties of the Agent.

(a)	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.

(b)	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.

(c)	If the Agent receives notice from a Party referring to this Agreement, describing an Event of Default and stating that the circumstance described is an Event of Default, it shall promptly notify the other Creditor Parties.

(d)	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 or a Mandated Lead Arranger) under this agreement it shall promptly notify the other Creditor Parties.

(e)	The Agent’s duties under the Finance Documents are solely administrative in nature.

25.3

Role of the Mandated Lead Arrangers. None of the Mandated Lead Arrangers has any obligations of any kind to any other Party under or in connection with any Transaction Document or the SACE Insurance Policy.

25.4

No fiduciary duties.

(a)	Nothing in this Agreement constitutes the Agent or any of the Mandated Lead Arrangers as a trustee or fiduciary of any other person.

(b)	Neither the Agent nor any of the Mandated Lead Arrangers shall be bound to account to any Lender for any sum or the profit element of any sum received by it for its own account.

25.5

Business with the Guarantors. The Agent and each of the Mandated Lead Arrangers may accept deposits from, lend money to and generally engage in any kind of banking or other business with any Affiliate or subsidiary of the Guarantors.

25.6

Rights and discretions of the Agent.

(a)	The Agent may rely on:

(i)

any representation, notice or document believed by it to be genuine, correct and appropriately authorised; and

(ii)

any statement made by a director, authorised signatory or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify.

(b)	The Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Lenders) that:

(i)

no Event of Default has occurred (unless it has actual knowledge of an Event of Default); and

(ii)

any right, power, authority or discretion vested in any Party or the Lenders has not been exercised.

(c)	The Agent may engage, pay for and rely on the advice or services of any lawyers, accountants, surveyors or other experts.

(d)	The Agent may act in relation to the Finance Documents through its personnel and agents.

(e)	The Agent may disclose to any other Party any information it reasonably believes it has received as the Agent under this Agreement.

(f)

25.7

Lenders’ instructions.

(a)	Unless a contrary indication appears in a Finance Document, the Agent shall:

(i)

(ii)

not be liable for any act (or omission) if it acts (or refrains from taking any action) in accordance with an instruction of the Majority Lenders.

(b)	Unless a contrary indication appears in a Finance Document, any instructions given by the Majority Lenders will be binding on all the Creditor Parties.

(c)	The Agent may refrain from acting in accordance with the instructions of the Majority Lenders until it has received such security as it may require for any cost, loss or liability (together with any associated value added tax) which it may incur in complying with the instructions.

(d)	In the absence of instructions from the Majority Lenders the Agent may act (or refrain from taking action) as it considers to be in the best interest of the Lenders.

(e)	The Agent is not authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to any Finance Document.

(f)

25.8

Responsibility for documentation. The Agent is not responsible for;

(a)	the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by the Agent, a Mandated Lead Arranger, an Obligor or any other person given in or in connection with any Transaction Document or the SACE Insurance Policy; nor for

(b)	the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the SACE Insurance Policy or any other agreement, arrangement or document entered into, made or executed in anticipation of or in connection with any Transaction Document or the SACE Insurance Policy.

25.9

Exclusion of liability.

(a)	Without limiting Clause 25.9(b), the Agent will not be liable for any action taken by it under or in connection with any Finance Document, unless directly caused by its gross negligence or wilful misconduct.

(b)

(c)

(d)

25.10

Lenders’ indemnity to the Agent. 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 (3) 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 an Obligor pursuant to a Finance Document).

25.11

Resignation of the Agent.

(a)	The Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Creditor Parties and the Borrower.

(b)	Alternatively the Agent may resign by giving notice to the other Creditor Parties and the Borrower, in which case the Lenders (after consultation with the Borrower) may appoint a successor Agent.

(c)	If the Lenders have not appointed a successor Agent in accordance with Clause 25.11(b) within thirty (30) days after notice of resignation was given, the Agent (after consultation with the Borrower) may appoint a successor Agent.

(d)	The retiring Agent shall, at its own cost, 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)

(g)

After consultation with SACE, the Lenders may, by notice to the Agent, require it to resign in accordance with Clause 25.11(b). In this event, the Agent shall resign in accordance with Clause 25.11(b).

25.12

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 another division or department of the Agent, it may be treated as confidential to that division or department and the Agent shall not be deemed to have notice of it.

25.13

Relationship with the Lenders. The Agent may treat each Lender as a Lender, entitled to payments under this Agreement and acting through its Facility Office unless it has received not less than five (5) Business Days’ prior notice from that Lender to the contrary in accordance with the terms of this Agreement.

25.14

Credit appraisal by the Lenders. Without affecting the responsibility of any Obligor for information supplied by it or on its behalf in connection with any

Finance Document, each Lender confirms to the Agent and each of the Mandated Lead 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 Finance Document including but not limited to:

(a)	the financial condition, status and nature of the Guarantors and each subsidiary of the Guarantors;

(b)	the legality, validity, effectiveness, adequacy or enforceability of any Finance Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Finance Document;

(c)

(d)

25.15

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.

25.16

SACE Agent. Where the context permits, references to the Agent shall include the SACE Agent. The Agent and the SACE Agent shall be the same entity throughout the Security Period.

26.

CONDUCT OF BUSINESS BY THE CREDITOR PARTIES

26.1

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

(c)	oblige any Creditor Parry to disclose any information relating to its affairs (Tax or otherwise) or any computations in respect of Tax.

27.

SHARING AMONG THE CREDITOR PARTIES

27.1

Payments to Creditor Parties. If a Creditor Party (a “ Recovering Creditor Party ”) receives or recovers any amount from an Obligor other than in accordance with Clause 27 and applies that amount to a payment due under the Finance Documents then:

(a)	the Recovering Creditor Party shall, within three (3) 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 19 and Clause 28), without taking account of any Tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and

(c)

27.2

Redistribution of payments. The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and distribute it between the Creditor Parties (other than the Recovering Creditor Party) in accordance with Clause 19 and Clause 28.

27.3

Recovering Finance Party’s rights.

(a)	On a distribution by the Agent under Clause 27.2, the Recovering Creditor Party will, if possible under the relevant applicable laws, be subrogated to the rights of the Creditor Parties which have shared in the redistribution.

(b)	If and to the extent that the Recovering Creditor Party is not able to rely on its rights under Clause 27.3(a), the relevant Obligor shall be liable to the Recovering Creditor Party for a debt equal to the Sharing Payment which is immediately due and payable.

27.4

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 Lender which has received a share of the relevant Sharing Payment pursuant to Clause 27.2 shall, upon request of the Agent, pay to the Agent for 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); and

(b)	that Recovering Creditor Party’s rights of subrogation in respect of any reimbursement shall be cancelled and the relevant Obligor will be liable to the reimbursing Finance Party for the amount so reimbursed.

27.5

Exceptions.

(a)	This Clause 27 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 relevant Obligor.

(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)

28.

PAYMENT MECHANICS

28.1

Payments to the Agent.

(a)

(b)	Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to Euro, in a principal financial centre in a Participating Member State or London) with such bank as the Agent specifies.

(c)	Payment shall be made before 11.00 a.m. New York time or 11.00 a.m. Paris time (in the case of a payment in Euro).

(d)	For each payment by the Borrower, it shall notify the Agent on the third Business Day prior to the due date for payment that it will issue to its bank (which shall be named in such notification) to make the payment.

28.2

Distributions by the Agent. Each payment received by the Agent under the Finance Documents for another Party shall, subject to Clause 28.3, Clause 28.4 and Clause 28.15 be made available by the Agent as soon as practicable after receipt to the Party entitled to receive payment in accordance with this Agreement (in the case of a Lender, for the account of its Facility Office), to such account as that Party may notify to the Agent by not less than five (5) Business Days’ notice with a bank in the principal financial centre of the country of that currency (or, in relation to Euro, in the principal financial centre of a Participating Member State or London).

28.3

Distributions to an Obligor. The Agent may in accordance with Clause 22 apply any amount received by it for that Obligor in or towards payment (on the date and in the currency and funds of receipt) of any amount due from that Obligor under the Finance Documents or in or towards purchase of any amount of any currency to be so applied.

28.4

Clawback.

(a)

(b)

28.5

No set-off by Obligors. All payments to be made by an Obligor under the Finance Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.

28.6

Business Days.

(a)	Any payment which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).

(b)	During any extension of the due date for payment of any principal or unpaid sum under this Agreement interest is payable on the principal or unpaid sum at the rate payable on the original due date.

28.7

Currency of account.

(a)	Subject to Clauses 28.7(b) and 28.7(c) Dollars is the currency of account and payment for any sum from an Obligor under any Finance Document.

(b)	Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or taxes are incurred.

(c)	Any amount expressed to be payable in a currency other than Dollars shall be paid in that other currency.

28.8

Change of currency.

(a)	Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:

(i)

(ii)

(b)

29.

GOVERNING LAW

29.1

Law. This Agreement is governed by English law.

30.

ENFORCEMENT

30.1

Jurisdiction of English courts. The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement) (a “ Dispute ”). Each Party agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.

30.2

Service of process. Without prejudice to any other mode of service allowed under any relevant law, the Borrower:

(a)	irrevocably appoints EC3 Services Limited of 51 Eastcheap, London EC3M 1JP, as its agent for service of process in relation to any proceedings before the English courts in connection with any Finance Document; and

(b)	agrees that failure by a process agent to notify the Borrower of the process will not invalidate the proceedings concerned.

31.

SCHEDULES

31.1

Integral Part. The schedules form an integral part of this Agreement.

32.

NOTICES

32.1

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.

32.2

Addresses for communications. A notice shall be sent:


(a)	to the Borrower:	8300 NW 33rd Street #308
		Miami, FL 33122, USA

		Fax No. (00) 1 305 514 2297

(b)	to a Lender:	At the address below its name in Schedule 1 or (as the case may require) in the relevant Transfer Certificate.

(c)	to the Agent or the SACE	9 quai du Président Paul Doumer
	Agent:	92920 Paris La Défense Cedex
		Paris

		Fax No.: (33) 1 41 89 29 87
		Attn: Shipping Group
		Mr. Guy-Olivier Bygodt

		and

		Fax No.: (33) 1 41 89 19 34
		Attn: Shipping Middle Office
		Ms. Sylvie Godet-Couery

or to such other address as the relevant party may notify the Agent, or if the relevant party is the Agent, the Borrower, the Lenders and the Borrower.

32.3

Effective date of notices. Subject to Clauses 32.4 and 32.5:

(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;

(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.

32.4

Service outside business hours. However, if under Clause 32.3 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 6 p.m. local time;

(c)	the notice shall (subject to Clause 32.5) be deemed to be served, and shall take effect, at 9 a.m. on the next day which is such a business day.

32.5

Illegible notices. Clauses 32.3 and 32.4 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.

32.6

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.

32.7

English language. Any notice under or in connection with a Finance Document shall be in English.

32.8

Meaning of “notice”. In this Clause 32, “notice” includes any demand, consent, authorisation, approval, instruction, waiver or other communication.

33.

SUPPLEMENTAL

33.1

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.

33.2

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.

33.3

Counterparts. A Finance Document may be executed in any number of counterparts.

33.4

Third party rights. 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 provided that nothing in this Clause shall limit or prejudice the exercise by SACE of its rights under this Agreement or the Finance Documents in the event that such rights are subrogated or assigned to it pursuant to the terms of the SACE Insurance Policy.

33.5

No waiver. No failure or delay on the part of a Creditor Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise thereof preclude any other or further exercise thereof by the Creditor Parties or the exercise by the Creditor Parties of any other right, power or privilege. The rights and remedies of the Creditor Parties herein provided are cumulative and not exclusive of any rights or remedies provided by law.

33.6

Writing required. This Agreement shall not be capable of being modified otherwise than by an express modification in writing signed by the Borrower, the Agent and the Lenders.

THIS AGREEMENT has been entered into on the date stated at the beginning of this Agreement.

SCHEDULE 1

LENDERS AND COMMITMENTS


Lender	Facility Office	Commitment
		(%)

Calyon	9 quai du Président Paul Doumer	[*]%
	92920 Paris La Défense Cedex
	France

Société Générale	29 boulevard Haussmann	[*]%
	75009 Paris
	France

SCHEDULE 2

FORM OF DRAWDOWN NOTICE

To:

[Calyon]

Attention: [Loans Administration]

[ — ]

DRAWDOWN NOTICE

2	We request to borrow as follows:-

(a)	Amount: US$[ — ];

(b)	Drawdown Date: [ — ];

(c)	[Duration of the first Interest Period shall be [ — ] months;]

(d)	Payment instructions: [to be completed].

3	We represent and warrant that:

(a)	the representations and warranties in Clauses 12.2 and 12.3 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;

(b)	no 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 Agent.

5	We authorise you to deduct the commitment fee accrued and unpaid referred to in Clause 10.1(b) from the amount of the Loan.

[Name of Signatory]

Director

for and on behalf of

RIVIERA NEW BUILD, LLC

SCHEDULE 3

DOCUMENTS TO BE PRODUCED BY THE BUILDER

TO THE AGENT ON DELIVERY

Certified Copy of the commercial invoice evidencing payment by the Borrower and receipt by the Builder of the instalments already paid pursuant to the Shipbuilding Contract and the Final Contract Price, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.

Certified cony of bank statements evidencing receipt by the Builder of the first, second, third and fourth instalments of the Initial Contract Price (as described in Recital (B)).

Certified Copy of the Protocol of Delivery and Acceptance, duly executed by the Builder and the Borrower.

Certified Copy of the declaration of warranty, duly executed by the Builder confirming that the Ship is delivered to the Borrower free and clear of all encumbrances whatsoever.

Certified Copy of the power of attorney pursuant to which the authorised signatory of the Builder signed the documents referred to in this Schedule 3 and a specimen of his signature.

Certified Copy of the Exporter’s Declaration to SIMEST duly executed by the Builder and delivered to SIMEST (where the Fixed Interest Rate has been selected).

EXECUTION PAGES


BORROWER
SIGNED by		)
FRANK J. DEL RIO		)
for and on behalf of		)
RIVIERA NEW BUILD, LLC		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises

LENDERS

SIGNED by		)
GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises

SIGNED by		)
GEOFFREY D. FERRER		)
for and on behalf of		)
SOCIETE GENERALE		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises

MANDATED LEAD ARRANGERS

SIGNED by		)
GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises


SIGNED by		)
SOCIETE GENERALE		)
for and on behalf of		)
GEOFFREY D. FERRER		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises

AGENT AND SACE AGENT

SIGNED by		)
GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
in the presence of:		)

Luis San Miguel
CFO Oceania Cruises
CFO Oceania Cruises

IRREVOCABLE LETTER OF CREDIT NUMBER [**BANK TO INSERT**]

[**BANK TO INSERT DATE OF ISSUANCE**]

BENEFICIARY:

CALYON, AS AGENT FOR THE LENDERS UNDER THE LOAN AGREEMENT, DATED [**DATE TO BE INSERTED**] BETWEEN RIVIERA NEW BUILD LLC AS BORROWER, THE BANKS AND FINANCIAL INSTITUTIONS LISTED IN SCHEDULE 1 THERETO AS LENDERS, CALYON AND SOCIETE GENERALE AS MANDATED LEAD ARRANGERS AND CALYON AS AGENT AND SACE AGENT WITH RESPECT TO THE LOAN AGREEMENT DATED 2008 IN RESPECT OF THE FINANCING OF VESSEL HAVING HULL NO 6195 (THE “ LOAN AGREEMENT ”)

9, QUAI DU PRESIDENT PAUL DOUMER

92920 PARIS LA DEFENSE CEDEX, FRANCE

LADIES & GENTLEMEN:

THIS LETTER OF CREDIT IS ISSUED IN CONNECTION WITH THE TRANSACTION CONTEMPLATED BY THE LOAN AGREEMENT.

CERTIFICATE CONFORMS TO THE TERMS AND CONDITIONS HEREOF, PAYMENT OF THE DRAWING AMOUNT SHALL BE MADE TO BENEFICIARY IN IMMEDIATELY AVAILABLE FUNDS ON THE THIRD FOLLOWING BUSINESS DAY.

IF A DEMAND FOR PAYMENT MADE OR DRAWING CERTIFICATE PRESENTED HEREUNDER BY BENEFICIARY DOES NOT CONFORM TO THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, THE BANK SHALL GIVE BENEFICIARY NOTICE BY FACSIMILE TRANSMISSION AND OVERNIGHT COURIER DELIVERY WITHIN TWO BUSINESS DAYS OF PRESENTMENT THAT THE DEMAND FOR PAYMENT OR DRAWING CERTIFICATE WAS NOT MADE IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, STATING THE REASONS THEREFORE AND THAT THE BANK WILL RETURN SAME TO BENEFICIARY. UPON BEING NOTIFIED OF A NON-CONFORMING DEMAND OR DRAWING CERTIFICATE, BENEFICIARY MAY ATTEMPT TO CORRECT SUCH DEMAND OR DRAWING CERTIFICATE TO THE EXTENT THAT IT IS ENTITLED TO DO SO.

THE STATED AMOUNT SHALL BE REDUCED PERMANENTLY BY THE AMOUNT OF EACH DRAWING HONORED BY THE BANK.

THE BENEFICIARY MAY ASSIGN OR TRANSFER ITS RIGHTS UNDER AND IN CONNECTION WITH THIS LETTER OF CREDIT TO SERVIZI ASSICURATIVI DEL COMMERCIO ESTERO - SACE SPA (“ SACE ”) AND, UPON NOTIFICATION BY THE BENEFICIARY TO THE BANK OF THE TRANSFER TO SACE, THE TRANSFER SHALL BE DEEMED TO BE EFFECTED AS OF THE DATE OF SUCH NOTIFICATION WITHOUT THE CONSENT OF THE BANK AND THEREAFTER SACE SHALL BE THE BENEFICIARY HEREUNDER AND RULE 6.02 (b) (iii) OF INTERNATIONAL STANDBY PRACTICES 1998 (INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION 590) (THE “ ISP98 ”) SHALL NOT APPLY

AS USED IN THIS LETTER OF CREDIT “BUSINESS DAY” SHALL MEAN ANY DAY OTHER THAN A SATURDAY, SUNDAY OR A DAY ON WHICH BANKING INSTITUTIONS IN NEW YORK CITY ARE REQUIRED OR AUTHORIZED TO CLOSE.

FACSIMILE TRANSMISSION AND OVERNIGHT COURIER, THAT THE BANK ELECTS NOT TO SO EXTEND THE EXPIRATION DATE FOR SUCH ADDITIONAL PERIOD. UPON RECEIPT BY THE BENEFICIARY OF SUCH NOTICE THE BENEFICIARY MAY MAKE A SINGLE DRAWING HEREUNDER FOR UP TO THE THEN AVAILABLE STATED AMOUNT BY PRESENTING TO THE BANK THE BENEFICIARY’S DRAWING CERTIFICATE IN THE FORM ATTACHED HERETO AS EXHIBIT B.

EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN, THIS LETTER OF CREDIT IS ISSUED SUBJECT TO INTERNATIONAL STANDBY PRACTICES 1998 (INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION 590) (THE “ ISP98 ”). THIS LETTER OF CREDIT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL, AS TO MATTERS NOT GOVERNED BY THE ISP98, BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREIN.

COMMUNICATIONS TO THE BANK REGARDING THIS LETTER OF CREDIT MUST BE IN WRITING AND MUST BE ADDRESSED TO THE BANK AT [**BANK TO INSERT ADDRESS**], ATTENTION: [**BANK TO INSERT**], ATTENTION: [**BANK TO INSERT**] SPECIFICALLY REFERRING THEREIN TO THIS LETTER OF CREDIT BY ITS NUMBER.

VERY TRULY YOURS,

[ — ]

EXHIBIT A TO LETTER OF CREDIT NUMBER

[**BANK TO INSERT**] DRAWING CERTIFICATE


TO:		[ — ]
		[BANK TO INSERT NAME AND ADDRESS]

ATTENTION:		[*BANK TO INSERT”`]

RE:		YOUR LETTER OF CREDIT [BANK TO INSERT]

LADIES & GENTLEMEN:

AN EVENT OF DEFAULT (AS DEFINED IN THE LOAN AGREEMENT) HAS OCCURRED; AND

PAYMENT OF THIS DEMAND IS REQUIRED TO BE MADE IN IMMEDIATELY AVAILABLE FUNDS, BY WIRE TRANSFER, TO BENEFICIARY IN ACCORDANCE WITH THE FOLLOWING PAYMENT INSTRUCTIONS:

[INSERT PAYMENT INSTRUCTIONS]

IN WITNESS WHEREOF BENEFICIARY HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS OF THE DAY OF , 20 .


VERY TRULY YOURS, THE BENEFICIARY

BY:

NAME:

TITLE:

EXHIBIT B TO LETTER OF CREDIT NUMBER [**BANK TO INSERT**]

DRAWING CERTIFICATE


TO:		[ — ]
		[BANK TO INSERT NAME AND ADDRESS]

ATTENTION:		[*BANK TO INSERT”`]

RE:		YOUR LETTER OF CREDIT [BANK TO INSERT]

LADIES & GENTLEMEN:

BENEFICIARY HAS RECEIVED NOTICE FROM THE BANK THAT THE EXPIRATION DATE OF THE LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE CURRENT EXPIRATION DATE OF [ DATE TO BE INSERTED ].

PAYMENT OF THIS DEMAND IS REQUIRED TO BE MADE IN IMMEDIATELY AVAILABLE FUNDS, BY WIRE TRANSFER, TO BENEFICIARY IN ACCORDANCE WITH THE FOLLOWING PAYMENT INSTRUCTIONS:

[INSERT PAYMENT INSTRUCTIONS]

IN WITNESS WHEREOF BENEFICIARY HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS OF THE DAY OF , 20 .


VERY TRULY YOURS, THE BENEFICIARY

BY:

NAME:

TITLE:

Exhibit 10.17

Execution Copy

AMENDED AND RESTATED

REGENT TRADEMARK LICENSE AGREEMENT

This Amended and Restated Trademark License Agreement (“ Agreement ”), effective as of February 21st, 2011 (the “ Amendment Effective Date ”), is by and between Regent Hospitality Worldwide, LLC (formerly known as Regent Hospitality Worldwide, Inc.), a limited liability company organized under the laws of Delaware (“ Licensor ”) and Seven Seas Cruises, S.DE R.L. (formerly known as Classic Cruises Holdings S.DE R.L.), a corporation organized under the laws of Panama (“ Licensee ”).

WHEREAS, pursuant to the Regent Trademark License Agreement, dated January 31, 2008, (the “ Original License Agreement ”), between Licensor and Licensee, Licensor granted a license (the “ License ”) to Licensee to use the trademarks identified therein as the “ RLG Marks ” (as defined below) upon the terms specified in the Original License Agreement;

WHEREAS, in connection with the Original License Agreement, Licensee entered into (i) an Agreement for the Sale and Purchase (the “ SPA ”) of the interest of Carlson Cruises Worldwide, Inc. in the Regent Seven Seas cruise business (the “ RSSC Business ”) with Carlson Cruises Worldwide, Inc. (“ CCW ”), a Minnesota corporation and an Affiliate of the prior owner of Licensor, and (ii) a Master Agreement (the “ MA ”) through which Licensee acquired the RSSC Business from CCW;

WHEREAS, Licensor and Licensee have now agreed to amend and restate the Original License Agreement to provide that Licensee’s License to use the RLG Marks shall be perpetual, subject to the terms and conditions of this Agreement;

NOW THEREFORE, in consideration of the mutual promises contained herein, and for good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the parties agree as follows:

ARTICLE I DEFINITIONS

1.1 “ Affiliate ” shall mean any person (other than a natural person) controlled by, controlling, or under common control with either party. For purposes of this definition, “ control ” means the power to direct the management and policies of the Person, directly or indirectly, whether through the ownership of voting securities or other equity interests, by contract, by family relationship or otherwise.

1.2 “ Change of Control ” shall mean any merger or consolidation involving Licensee or any directly or indirectly controlling Affiliate(s) of Licensee (“ Controlling Affiliate ”); any sale or transfer of all or substantially all of Licensee’s or its Controlling Affiliate’s assets; any public or private offering, or series of public or private offerings, whereby a cumulative total of 50% or more of the voting stock or other equity interest of Licensee or its Controlling Affiliate(s) is offered for purchase; any acquisition, or series of acquisitions, by any person or entity, or group of related persons or entities, of a cumulative total of 50% or more of the voting stock or other equity interest of Licensee or its Controlling Affiliate(s) or the right to vote such percentage of voting stock or other equity interest.

1.3 “ Claim ” shall mean any claims, causes of action, suits, proceedings, losses, damages, demands, fees, expenses, fines, judgments, liabilities, penalties, expenses of any nature, and costs (including reasonable attorney’s fees).

1.4 “ Comparable Cruise Line ” shall mean those Luxury Cruise lines listed below that are considered to have the appropriately high level of standards, operation, and guest experiences required for all goods and services offered under the RLG Marks. Initially, Comparable Cruise Lines include: Crystal Cruises, Silversea, and The Yachts of Seabourn. In the event that one of these Comparable Cruise Lines ceases operation of Luxury Cruise lines or experiences a material decline in quality and/or reputation in the Luxury Cruise Business (from the objective standpoint of the luxury cruise line industry, not the subjective opinion of Licensor), then either Licensor or Licensee may request a replacement of that Luxury Cruise line with another Luxury Cruise line that meets the Luxury Cruise line standards. If Licensor and Licensee are unable to reach a mutual agreement with respect to the need for or the identity of a replacement Luxury Cruise line within thirty (30) days of a request by either Licensor or Licensee, then either Licensor or Licensee may submit the matter for resolution by an Independent Expert in accordance with the procedures set forth in Section 14.22.

1.5 “ Confidential and Proprietary System Information ” shall mean all customer information, Customer Data (as defined below) and any other confidential and proprietary information of Licensor or Licensee that is disclosed to the other party pursuant to this Agreement, however embodied, that relate to the business of either Licensor or Licensee. Confidential and Proprietary System Information will not include any information that can be reasonably shown by contemporaneous evidence that (a) at the time of disclosure to the recipient party is in the public domain through no fault of the recipient party; (b) after disclosure hereunder, becomes part of the public domain by publication or otherwise, except where such disclosure is caused by the breach of this Agreement or any other action or omission by the recipient party; (c) the recipient party can demonstrate is developed by or for recipient party independent of the confidential information of the disclosing party; or (d) the recipient party receives from third parties, provided such information was not obtained, to the knowledge of the recipient party, by such third parties from the disclosing party on a confidential basis. The terms of this Agreement shall be considered Confidential and Proprietary System Information.

1.6 “ Customer Data ” shall mean any personal or private data or information regarding any individual customer or Person (as defined below), including but not limited to contact information, credit and financial information, and prior business transactions and experiences.

1.7 “ Independent Expert ” shall mean an independent, internationally recognized industry consulting firm or individual, who is knowledgeable regarding the Luxury Cruise Business and has no conflict of interest, personal or financial relationship with either of the parties.

1.8 “ Licensed Use ” shall mean use of the RLG Marks only on or in connection with Luxury Cruise vessels, products, merchandise, and services associated with the Luxury Cruise Business that Licensee or its Affiliate operates before or after the Amendment Effective Date.

1.9 “ Luxury Cruise ” shall mean a cruise on a vessel whose amenities, goods, and services meet or exceed the standards, operation and guest experience of a Comparable Cruise Line and meets a quality standard that is equal to or greater than that on the m/v Seven Seas Voyager, the m/v Seven Seas Navigator and the m/v Seven Seas Mariner as of the date of this Agreement.

1.10 “ Luxury Cruise Business ” shall mean the operation of Luxury Cruise vessels and the associated marketing, sales and delivery of Luxury Cruise voyages on Luxury Cruise vessels.

1.11 “ Person ” shall mean any natural person or legal entity, including trustees, representatives, administrators, heirs, executors, partnerships, corporations, limited liability companies, trusts, unincorporated organizations, and governmental agencies, departments, and branches.

1.12 “ RLG Marks ” shall mean the marks listed in Exhibit A, including (i) all common law rights in and to such marks, (ii) any and all registrations and applications for registration obtained or filed in the United States or any other jurisdiction(s), and, (iii) the goodwill of any business connected to and symbolized by such trademarks.

1.13 “ Seven Seas Marks ” shall mean the marks listed in Exhibit D, including (i) all common law rights in and to such marks, (ii) any and all registrations and applications for registration obtained or filed in the United States or any other jurisdiction(s), and, (iii) the goodwill of any business connected to and symbolized by such trademarks.

1.14 “ RSSC Marks ” shall mean the marks listed in Exhibit I, including (i) all common law rights in and to such marks, (ii) any and all registrations and applications for registration obtained or filed in the United States or any other jurisdiction(s), and, (iii) the goodwill of any business connected to and symbolized by such trademarks.

1.15 “ Territory ” shall mean anywhere in the world.

1.16 “ Third Party ” shall mean any Person, other than Licensor, Licensee, and their respective Affiliates.

ARTICLE II LICENSE GRANT

2.1 License of RLG Marks. Subject to the terms and conditions of this Agreement, Licensor hereby grants and continues to grant to Licensee, and Licensee accepts from Licensor, an exclusive (even as to Licensor and those taking through Licensor), perpetual, irrevocable, royalty-free and fully paid-up license and right to use the RLG Marks, in conformity with the style of the RLG Marks specified in Exhibit A hereto, in connection with the Licensed Use in the Territory. Licensee shall not have the right to grant any sub-licenses for the RLG Marks solely for use in connection with Licensed Use, to any Person, other than Affiliates of Licensee, without the express written permission of Licensor.

2.2 Use of Other Marks. Notwithstanding any provision to the contrary, Licensee may operate Luxury Cruise vessels under marks other than the RLG Marks; provided, however, that Licensee shall not use any other mark, other than the Seven Seas Marks, on a Luxury Cruise vessel or in connection with the Luxury Cruise Business in a manner that co-mingles such mark with the RLG Marks without the prior express written permission of Licensor, which shall not be unreasonably withheld or delayed. Licensee agrees that where the RLG Marks are used in combination with other marks, the RLG Marks shall not be displayed in such a manner as to be secondary in size or otherwise in emphasis (including in the form “ Seven Seas Regent ” or otherwise reversing the priority of the existing combination mark “ Regent Seven Seas ”). For clarity, the parties agree that the restriction on co-mingling of other marks with the RLG Marks includes any use of the RLG Marks by Licensee in conjunction with any general promotion or marketing of any hotel brand other than Licensor’s hotel brand; provided that this shall not prevent or restrict Licensee from promoting and marketing hotels of any brand as excursions for cruise passengers or other purposes specifically related to Licensee’s Luxury Cruise Business and not the general marketing of another hotel brand.

2.3 Non-competition . So long as this Agreement remains in effect, Licensor agrees not to enter into the Luxury Cruise Business under the RLG Marks or license any Third Party the right to use any of the RLG Marks in the Luxury Cruise Business or non-luxury cruise business.

2.4 Retained Rights . Licensor retains all rights not expressly conveyed to Licensee hereunder, including the right to use the RLG Marks outside of the Licensed Use as well as the right for Licensor to grant licenses for such retained rights to third parties; provided, however, that Licensor in all instances shall exercise or license its retained rights in the RLG Marks in a manner consistent with the RLG Marks’ luxury image and commensurate with the standards that Licensee is obligated to maintain hereunder.

ARTICLE III CONSIDERATION

3.1 Consideration . In consideration of and for the rights and privileges granted by Licensor to Licensee under this Agreement, Licensee agrees to pay to Licensor the following amounts on the dates set forth below:

(a) All royalty payments due and owing from Licensee under the Original License Agreement, equal to $1,197,094 for the period ended September 30, 2010, plus $400,000 for the quarter ended December 31, 2010, and the sum of $5,100,000, within three days following the signing of this Agreement,

(b) $2,000,000 upon the one year anniversary date of this Agreement, and

3.2 No Further Payment . Licensor hereby acknowledges and agrees that no further payment, in the form of percentages of Cruise Revenues (as defined in the Original Agreement) or otherwise, will be due from Licensee to Licensor, including any payments that may have accrued prior to the Amendment Effective Date. Licensor acknowledges and agrees that the payment under Section 3.1(a) of this Agreement will be deemed complete satisfaction of any and

all payments, in the form of percentages of Cruise Revenues (as defined in the Original Agreement) or otherwise, or any interest for any late payments, that may have been due under the Original License Agreement prior to the Amendment Effective Date.

3.3 Late Payments . Licensee will pay Licensor interest on any amounts owed to Licensor that are past due at the lesser of one and one-half percent (1.5%) per month or the maximum rate of interest permitted by applicable law.

3.4 Mutual Release . Each of Licensor and Licensee, as additional consideration for entering into this Agreement, on its own behalf and on behalf of its Affiliates (in either case, the “ Releasing Party ”), hereby waives any claims, demands, actions and other rights (collectively, “ Claims ”) the Releasing Party may have against the other party, its Affiliates and their respective shareholders, members, officers, directors, affiliates, agents and representatives (in either case, the “ Released Parties ”), in law or in equity, whether known or unknown, arising under or in connection with the obligations or performance of either party hereto or its predecessor in interest under the Original License Agreement prior to the Amendment Effective Date, including any claims based upon facts known by either party prior to the Amendment Effective Date that could reasonably be expected to give rise to any breach of this Agreement, except for any indemnifiable Claims under the Original License Agreement as a result of actions that may be brought by any Third Parties against any of the Releasing Parties for events which occurred prior to the Amendment Effective Date. Each of Licensor and Licensee represent to the other party that they are not aware of any facts that could reasonably be expected to result in any Claim by any Third Party against the Releasing Party as of the Amendment Effective Date. Except as otherwise set forth herein, nothing in this release shall release the obligations of either Licensor or Licensee under this Agreement as of or subsequent to the Amendment Effective Date.

3.5 Costs, Expenses and Taxes . Except to the extent this Agreement specifically states that Licensor is to bear a specific cost (and regardless of whether the words “ at Licensee’s expense ” are used), all costs, expenses, obligations and taxes incurred or assessed with respect to the Luxury Cruise Business or Licensee’s exercise of its rights or performance of its obligations under this Agreement, are Licensee’s sole responsibility. Licensor shall be solely responsible only for any taxes imposed on Licensor on payments made by Licensee under this Agreement.

ARTICLE IV QUALITY CONTROL

4.1 Manner of Use . Licensee acknowledges that Licensor’s control over the nature and quality of any goods or services offered under the RLG Marks or advertising containing one or more of the RLG Marks is an essential and material element of this license and Agreement. Licensee shall use the RLG Marks solely in connection with the Licensed Use and in a manner that will protect the Licensor’s rights and goodwill therein and maintain the luxury image of the RLG Marks. Licensee shall ensure that all goods and services offered under or in connection with any of the RLG Marks shall meet or exceed the operation and guest experience of any Comparable Cruise Line.

4.2 Right of Inspection . Licensee shall, upon reasonable notice by Licensor and at a mutually convenient time (to avoid any disruption in the provision of services on board the vessel in question): (i) permit Licensor to inspect the manner in which Licensee exercises the

rights granted hereunder to use the RLG Marks; (ii) make available for Licensor’s inspection any of Licensee’s marketing or other materials that contain the RLG Marks; and (iii) permit Licensor or its designee to inspect the facilities of Licensee, including any and all of the Luxury Cruise vessels, that use the RLG Marks. Licensee shall also, upon request of Licensor, provide Licensor with current pictures of requested aspects of the Luxury Cruise vessels and facilities as well as any goods and/or services offered in connection with the RLG Marks.

4.3 Complaints . If any person, company, or entity (i) makes any written or oral complaint to Licensee in regard to the quality of any goods sold or services rendered using the RLG Marks and (ii) such complaint can be reasonably interpreted to mean that Licensee is not materially fulfilling the quality control obligation as set forth in this Article IV, then Licensee shall: (i) supply to Licensor samples of the products or a description of the services mentioned in the complaint along with a copy of the complaint, (ii) enact measures to meet the quality control obligation as set forth in Article IV, and (iii) provide to Licensor a summary of the complaint and the measures enacted to address the complaint.

ARTICLE V OWNERSHIP

5.1 Ownership of Marks . It is understood and agreed that, as between Licensor and Licensee, Licensor is the sole and exclusive owner of all right, title and interest in and to the RLG Marks for use in connection with the Licensed Use. Licensee recognizes the value of the goodwill associated with the RLG Marks in connection with such products and services and acknowledges that such marks and all rights therein, the goodwill pertaining thereto, and any registrations and applications for registration therefore, belong exclusively to Licensor. Licensee agrees that its use of the RLG Marks shall inure to the benefit of Licensor.

5.2 Maintenance . Licensor shall maintain and protect the RLG Marks subject to the exercise of Licensor’s reasonable business judgment. Licensee agrees to use commercially reasonable efforts to fully cooperate with any registration and maintenance efforts in relation to the marks upon request by Licensor.

5.3 Collateral Attack on Marks. Licensee agrees that during the term of this Agreement, or thereafter, it will not directly or indirectly attack or assist any Third Party in attacking the title or any rights of Licensor in and to the RLG Marks, the validity of the license being granted herein or any applications or registrations of such RLG Marks which Licensor may apply for or obtain in its name. Licensee further agrees that it shall not at any time institute any opposition or cancellation action regarding any of the RLG Marks, or any other similar mark of Licensor, with the U.S.P.T.O. or any other foreign governmental agency that registers trademarks, commence any civil proceeding for damages or injunctive relief, or make any other Claim that directly or indirectly would hinder Licensor’s use or ownership of any of the RLG Marks, or prevent the U.S.P.T.O. or any other foreign governmental agency that registers trademarks from issuing or renewing a trademark or service mark registration to Licensor for any of the RLG Marks or any variation thereof.

5.4 Registration of Marks, Trade Names and Domain Names.

(a) Licensee agrees that it will use commercially reasonable efforts to fully cooperate with Licensor in preparing and causing to be registered or recorded in every jurisdiction where applicable, trademark, service mark, and trade name applications and all other documents which may be necessary or desirable, in the sole reasonable opinion of Licensor, to evidence, protect, and implement the rights of Licensor in the RLG Marks, Licensee shall not register, attempt to register, acquire from a Third Party, or cause any Third Party to register, any trademark, service mark, company name, trade name or Internet domain name which is identical to, contains, or is confusingly similar to any of the RLG Marks.

(b) Notwithstanding the foregoing, Licensor has previously transferred to Licensee, and Licensee and its Affiliates are permitted to register or maintain, any registration with any Internet domain name registrar, for any Internet domain name transferred by Licensor and/or its Affiliates and used solely in the RSSC Business, including, but not limited to, those set forth in Exhibit F, provided such domain names do not contain the term “ Regent ”, “ RSSC ”, any other RLG Mark, or any variation thereof.

(c) Licensee shall also have the right to use any domain name owned by Licensor and/or its Affiliates and used solely in the RSSC Business prior to sale of the RSSC Business to Licensee that contains the term “ Regent ” or “ RSSC ” or any variation thereof, as set forth in Exhibit G, including without limitation controlling the content posted on or accessible through any website(s) associated with such domain names, maintaining the DNS for such domain names on its server(s) and using such domain names to forward Internet traffic to websites associated with other domain names, including without limitation domain names owned by Licensee; provided that such domain names are used in furtherance of the RSSC Business.

(d) In the case of any domain names owned by Licensor and/or its Affiliates and used with both the RSSC Business and the Regent hotel business prior to the sale of the RSSC Business to Licensee, including those set forth on Exhibit H, Licensee will work with Licensor in good faith to explore whether it is commercially practicable for Licensee and Licensor to continue to share use of the domain names; provided that such domain names are used in furtherance of the RSSC Business.

(e) Upon any future termination of this Agreement, consistent with Section 13.1, Licensee shall have a period of up to six (6) months in which to phase out its use of any domain names that contain the term “Regent”, “RSSC”, any other. RLG Marks, or any variation thereof, including those set forth in Exhibit F or registered pursuant to Section 5.4(g). During such phase-out period, Licensee shall be entitled to continue to control the content posted on or accessible through any website(s) associated with such domain names, maintain the DNS for such domain names on its server(s) and use such domain names to forward Internet traffic to websites associated with other domain names, including without limitation domain names owned by Licensee, until Licensee is able to complete the transition to new domain names.

(f) If Licensee has registered a domain name or registers a domain name in the future in violation of this Section 5.4, this Agreement serves as sufficient evidence for the domain name registrar to transfer ownership of the domain name to Licensor.

(g) Licensor shall register, at Licensee’s request and sole expense, any available domain names containing any of the RLG Marks specified by Licensee, other than those which Licensee is permitted under this Section 5.4 to own, and Licensee shall have the right to control the content posted on or accessible through any website(s) associated with such domain names, maintain the DNS for such domain names on its server(s) and use such domain names to forward Internet traffic to websites associated with other domain names, including without limitation domain names owned by Licensee; provided that such domain names are used in furtherance of the RSSC Business.

(h) For a period of six (6) months following any termination of this Agreement, Licensor shall (i) at Licensee’s sole expense, take any and all steps necessary to maintain the registrations for the domain names set forth in Exhibit G and any additional domain names registered pursuant to Section 5.4(g) above, (ii) refrain from selling or licensing any such domain names to any Third Party, and (iii) at Licensee’s sole expense, take any and all steps necessary to ensure that no such domain names become available for registration by any Third Party. For domain names that contain Seven Seas Marks or variations thereof, at the conclusion of the six-month period described in the preceding sentence, Licensor shall, at Licensee’s request and sole expense, either maintain or transfer such domain names to Licensee. For all other domain names, Licensor shall have complete discretion over the maintenance or disposition of the domain names. In no event, however, shall Licensee use any of the domain names set forth in Exhibit F or any additional domain names registered pursuant to Section 5.4(g) above in connection with any Internet website, electronic mail, or any other purpose following the six-month phase out period described in Section 5.4(e).

5.5 Disparagement. Licensee shall not use any of the RLG Marks to disparage Licensor, its products or services, or in any manner which, in Licensor’s reasonable judgment, may tarnish the RLG Marks or diminish, or otherwise damage Licensor’s goodwill in the RLG Marks.

5.6 No Assignment . Nothing contained in this Agreement shall be construed as an assignment to Licensee of any right, title or interest in and to the RLG Marks or any proprietary component thereof, it being expressly understood that all rights, title and interest relating to the RLG Marks are expressly reserved by Licensor except for the rights being licensed hereunder.

5.7 Proprietary Rights Notice. Licensee agrees to include on all documents, web pages, products, or other items displaying or using any of the RLG Marks, the legend “®” or “ SM ” or other appropriate notice, together with the notice that the marks are “service marks or registered service marks of Regent Hospitality Worldwide, LLC used under license. All Rights Reserved” or another notice specified by Licensor.

ARTICLE VI CONFIDENTIALITY

6.1 Right and Obligation to Use . Licensee will not use any Confidential and Proprietary System Information provided by Licensor for any purpose other than with respect to the operation of the Luxury Cruise Business pursuant to this Agreement. Licensor will not use, for any purpose, any Confidential and Proprietary System Information provided by Licensee.

6.2 Ownership and Non-Disclosure . As between Licensor and Licensee, the disclosing party owns all Confidential and Proprietary System Information provided by the disclosing party under this Agreement or improvements to Confidential and Proprietary System Information provided by the disclosing party under this Agreement. Recipient party will make no Claim and has no rights with respect to such information other than those that are granted in this Agreement. Recipient party will divulge disclosing party’s Confidential and Proprietary System Information only to Persons who must have access to such information in order to perform their responsibilities with respect to this Agreement or the operation of the Luxury Cruise Business. Recipient party will use all reasonable means to protect the confidentiality of disclosing party’s Confidential and Proprietary System Information and will not communicate or make it available to, or use it for the benefit of, any unauthorized Persons.

ARTICLE VII THIRD PARTY RIGHTS

7.1 Third Party Infringement . Licensee shall notify Licensor promptly in writing of any actual or threatened infringement of the RLG Marks by a Third Party that comes to Licensee’s attention. Licensor shall have sole discretion as to whether and how to respond to such infringement. Licensee shall have the right to take action on account of such infringement only upon receiving Licensor’s advance written approval, in which case Licensor shall have the right to join in any action with Licensee and to take any action on account of such infringement if Licensee declines to do so. Licensee shall not contact the Third Party, make any Claim, institute any suit or take any other action on account of such infringements, without first receiving Licensor’s advance written approval.

7.2 Assistance and Costs of Enforcement . With respect to any Claim that Licensor initiates on its own, without Licensee as a party, against any Third Party to enforce Licensor’s rights in and to any of the RLG Marks, Licensor shall have the sole right to direct the prosecution of such Claim and any settlement thereof. If Licensee and Licensor jointly initiate such a Claim, Licensor and Licensee shall each bear their own legal costs and expenses incurred in prosecuting such Claim. The parties shall share equally in any proceeds of such Claim or the settlement thereof attributable to the Licensed Use, after reimbursement to Licensor and to Licensee of their legal costs and expenses related to the prosecution of such Claim. If Licensee initiates such a Claim on its own, without Licensor as a party, then Licensee shall be entitled to any proceeds of such Claim and any settlement attributable to the Licensed Use. Each party agrees to provide reasonable assistance to the other party in the enforcement of any rights of the other party to the RLG Marks against Third Parties.

7.3 Defense of Rights; Defense of Claims Against Licensee. With respect to the RLG Marks, Licensee will notify Licensor promptly of any: (i) challenge to the use of the RLG

Marks; (ii) Claim by any Person to any rights in and to the RLG Marks; and (iii) anything else that Licensee reasonably believes may affect Licensor’s ownership or use or Licensee’s exercise of its rights under this Agreement (collectively, “ Challenges ”), to the extent Licensee becomes aware of such Challenges. If Licensee’s right to use the RLG Marks is the subject of any Challenge, or if Licensee is named as a party in any proceedings with respect to any Challenge, Licensee must deliver copies of all relevant documents to Licensor within seven (7) days after receiving them, and tender the defense to Licensor. Licensor, at its expense, will defend Licensee and control the defense against such Challenges resulting solely from Licensee’s use of the RLG Marks pursuant to this Agreement; provided, however, that Licensee’s consent shall be required for any settlement or other agreed or negotiated resolution of any Challenge that would impact the rights licensed to Licensee under this Agreement in any way, such consent not to be unreasonably withheld. Licensee will cooperate with Licensor, at Licensor’s expense, in defending any Challenge. With respect to any Challenge, whether or not brought to Licensor’s attention by Licensee or other Person, upon receipt of notice from Licensor that Licensor has made a determination through legal counsel, or that there has been an adjudication by a court of competent jurisdiction, that a Third Party’s right to all or any part of the RLG Marks is superior to Licensor’s, Licensee will immediately cease using as soon as practical that part of or all of the RLG Marks as specified by Licensor. Other than Licensor’s obligation to defend as set forth above, Licensor’s decisions and actions with respect to this Section shall not constitute a breach by Licensor under this Agreement or give Licensee any Claim for damages or other relief outside of this Agreement.

ARTICLE VIII REGENT BRAND COUNCIL

8.1 Continuation of Brand Council. Licensee is encouraged, but not required, to participate in a Regent Brand Council to be established by Licensor, for the purpose of discussing enhancements to the brand image and marketing initiatives. Any information provided at the Brand Council by Licensor, Licensee, or any other licensees regarding their respective current and future marketing strategies and programs shall be considered Confidential and Proprietary Information of the disclosing party and shall be maintained strictly confidential under the terms of Article VI, including the goods and services currently being or contemplated being offered under any of the RLG Marks. The Regent Brand Council shall not have any approval or veto rights over any party, rather the purpose shall be to meet and discuss strategy and to align the marketing efforts of the various parties.

8.2 Reservation Systems. Licensor may in the future explore whether it is commercially practicable to achieve and maintain compatibility of Licensee’s online and voice reservation system with that of Licensor, but Licensee will have no obligation to accept any proposal from Licensor with respect to Licensee’s reservation system.

ARTICLE IX DATA SHARING

9.1 Sharing . To the extent permitted by law and commercially reasonable, and provided that the parties are able to agree on a commercially reasonable framework for how such Customer Data is to be shared (including the manner and frequency of use of Customer Data by

the parties and other licensees of the RLG Marks), Licensor and Licensee may, on a voluntary basis and without obligation, provide Customer Data to each other from time to time. Licensor and Licensee shall not share or make any use of Customer Data provided by the other party without that party’s express written consent, which consent shall not be unreasonably withheld.

9.2 Compliance with Privacy Laws. Licensee and Licensor each represent, warrant and undertake that at all times they will each exercise commercially reasonable efforts to comply with, and will exercise commercially reasonable efforts to ensure that any vendors, employees, contractors and affiliates comply with, any and all applicable laws, regulations, or requirements of any applicable country or political subdivision thereof regarding the collection, storage, handling, transfer, or use of Customer Data collected by or on behalf of Licensee or shared with Licensee by Licensor. As between the parties, any such shared Customer Data shall be considered the Confidential and Proprietary System Information of the disclosing party and shall be protected as such under the terms of Article VI. The recipient party of any such shared Customer Data shall further comply at all times with the privacy policy of the disclosing party applicable to any such shared Customer Data.

ARTICLE X WARRANTIES

10.1 Indemnity . Subject to the provisions of the SPA and MA, Licensee assumes sole and complete responsibility for, and will indemnify, defend and hold harmless Licensor against and from, any Claim brought by any Third Party that is related to, arises out of, or is in any way connected with Licensee’s operation of its Luxury Cruise Business, including any Claim brought by any Third Party relating to any occurrence on any Luxury Cruise vessel or any acts or omissions by Licensee or anyone associated with Licensee. Licensee’s obligations under this Section shall not apply to any Claim arising solely and directly from any acts or omissions by Licensor, its Affiliates, or Licensor’s other licensees.

10.2 Licensor Warranty. Licensor represents and warrants that: (a) it or one of its Affiliates is the owner of the applications and registrations for the RLG Marks listed on Exhibit A, free and clear of any liens or security interests; (b) to the best of Licensor’s knowledge and belief, Licensee’s use of the RLG Marks in accordance with this Agreement will not violate the rights of any third party; (c) Licensor has all rights and authority necessary to grant the license to use all of the RLG Marks to Licensee and fulfill Licensor’s obligations under this Agreement; (d) the grant of rights by Licensor under this Agreement does not and will not conflict with any agreement to which Licensor is a party; and (e) Licensor will not grant any rights that conflict with the rights granted to Licensee under this Agreement. Licensor further represents and warrants that it will not take any action or omit to take any action in connection with the operation of its business, including but not limited to the provision of hotel services and any licensing activities regarding the RLG Marks, that is likely to significantly impair the value of the RLG Marks and the rights granted to Licensee under this Agreement. Licensor also agrees that it will continue to invest in and develop the RLG Marks and the Regent brand generally in a manner consistent with the brand’s luxury image subject to Licensor’s reasonable business judgment. Licensor will use commercially reasonable efforts to renew the applications and registrations shown in Exhibit A, to the extent permitted by applicable law, in the name of Licensor or such of Licensor’s affiliates which is then current owner of such RLG Marks in each

of the jurisdictions, provided that Licensor shall have no obligation to renew applications and registrations for classes of use other than hotels, restaurants, residences, transportation or other classes with respect to the Luxury Cruise Business. Licensor shall indemnify, defend and hold harmless Licensee from and against any and all loss, damage, settlement, cost or expense (including legal expenses and expenses of other professionals) incurred or arising from any third party claim related to any breach by Licensor of the foregoing representations, in accordance with the procedures provided in Section 7.3.

ARTICLE XI ASSIGNMENT

11.1 Licensor . Licensor shall have the right to assign this Agreement in connection with an assignment of ownership in the RLG Marks, without the consent of Licensee; provided, that Licensor shall not be released of its obligations under this Agreement. Licensor shall give Licensee prior written notice in the event of any such assignment.

11.2 Security Interest of Licensee in RSSC Marks . Licensor hereby grants to Licensee a security interest in all of Licensor’s right, title and interest in and to the RSSC Marks, including all registrations that have been or may hereafter be issued or applied for thereon in the United States and any state thereof and in foreign countries, whether now or hereafter existing, including all goodwill associated therewith. Licensee shall have the right to file a financing statement providing notice of its security interest in the RSSC Marks. Upon any transfer or assignment of any RSSC Mark, whether voluntary or involuntary, Licensee may exercise any rights it may have as a secured party with respect to such RSSC Marks.

11.3 Licensee . Licensee shall have the right to assign this Agreement to one of its Affiliates who assumes the ownership and operation of the entire RSSC Business, upon providing Licensor with advanced written notice of such assignment; provided, that such Affiliate agrees in writing to be bound by the requirements and obligations under this Agreement as they apply to Licensee and such an assignment by Licensee to one of its Affiliates shall not be considered a Change of Control. Licensee shall not have the right to assign this Agreement to any Third Party without the advanced express written consent of Licensor, which may be withheld solely based upon Licensee’s reasonable business judgment, except that no such consent is required for any assignment of this Agreement in its entirety in connection with any merger, consolidation, restructuring, sale of all or substantially all of Licensee’s assets or business related to its Luxury Cruise Business. A Change of Control (including any initial or follow on public offering of securities) in Licensee shall not require any consent from Licensor.

ARTICLE XII TERM, TERMINATION AND REMEDIES

12.1 Term . This Agreement shall become effective as of the Amendment Effective Date and shall continue in full force and effect perpetually, unless terminated in accordance with the provisions set forth in this Article XII.

12.2 Default Which May Result in Termination . The following are events of material default by Licensee, which entitle Licensor to terminate this Agreement upon written notice (“ Second Notice ”) to Licensee if Licensee fails to cure the event of default within sixty (60) days following the date of the initial notice describing such default:

(a) Licensee ceases to continuously operate the Luxury Cruise Business or to use the RLG Marks in connection with the Luxury Cruise Business for a period of two years. For clarification, in the event of a valid assignment pursuant to Section 11.3, for any two year period that includes the date of assignment by Licensee, the period of non- use, if any, will refer to the combined period of non-use of the RLG Marks by Licensee during the period that it owned the RLG Marks and by the successor entity during the period that it owned the RLG Marks.

(b) Licensee directly or indirectly attacks or assists any Third Party in attacking the title, validity, enforceability or any right of Licensor in and to the RLG Marks or any applications or registrations of Licensor in and to the RLG Marks.

(c) Licensee fails to pay any amounts owed to Licensor under this Agreement for a period of five (5) days past the date that such payment is due under this Agreement.

The effective date of termination for a default under this Section 12.2 is the date stated in the Second Notice.

12.3 Defaults Requiring Independent Expert Determination . The following are events of material default by Licensee that entitle Licensor to bring an action to terminate this Agreement in accordance with the provisions of Section 12.4.

(a) Licensee’s material failure to comply with the quality standards required under Section 4.1 of this Agreement in connection with the use of the RLG Marks, which has resulted, or could reasonably be expected to result, in material damage to the value of the RLG Marks.

(b) Licensee’s use of the RLG Marks in a manner that does not comply with the requirements for use of the RLG Marks as set forth in Sections 2.1 and 2.2.

12.4 Termination by Determination of Independent Expert . Licensor shall not have the right or ability to terminate the License or this Agreement for any reason specified in Section 12.3 unless:

(a) Licensor has provided Licensee with written notice of the event of default claimed by Licensor;

(b) Licensee has disputed the breach or failed to cure the breach within thirty (30) days of the date of Licensor’s notice;

(d) a determination, which is final and non-appealable, has been made by the Independent Expert in accordance with the procedures set forth in Section 14.23 that the Licensee has committed a material breach specified in Section 12.3 entitling Licensor to terminate the License.

12.5 Remedies for Other Defaults . In the event either party does not comply with any material provision of this Agreement and the non-breaching party elects to give the breaching party written notice of such noncompliance, then the breaching party shall have sixty (60) days from the receipt of such notice to remedy the breach. If the breach is not remedied within such sixty (60) day period, the non-breaching party shall have the right to seek any remedy available to it, at law or in equity, provided that, except as otherwise provided in Sections 12.2, 12.3 and 12.4, under no circumstances may the relief granted to any party include the rescission or termination of the licenses granted under this Agreement.

ARTICLE XIII CONSEQUENCES UPON TERMINATION

13.1 Licensee’s Obligations. Upon the termination of this Agreement, Licensee will, within six (6) months, stop using the RLG Marks, stop operating the Luxury Cruise Business under the RLG Marks, and stop representing the Luxury Cruise Business or any Luxury Cruise vessel to the public or holding it out as being affiliated or previously affiliated with Licensor or as a former Luxury Cruise vessel under the RLG Marks. Licensee will accomplish this by, without limitation, removing, returning or destroying, as instructed by Licensor: (i) any documents containing any of Licensor’s Confidential and Proprietary System Information, marketing materials, labels, and all other printed materials containing the RLG Marks; (ii) all interior and exterior signs and other items containing the RLG Marks; and (iii) anything else that might reasonably result in customers continuing to identify the Luxury Cruise Business with Licensor; provided, however, that Licensee shall not be obligated to recall any marketing materials incorporating or using the RLG Marks that have been disseminated to Third Parties prior to the termination of this Agreement. After such six month period, Licensee will cover up anything bearing the RLG Marks or otherwise identified as being associated with Licensor that cannot reasonably be removed on or before the end of such six month period, until it can be removed. Licensee shall, within thirty (30) days, provide notice to all customers who have reserved, booked, or placed a deposit for a Luxury Cruise of the name change and that the Luxury Cruise Business and Licensee are no longer affiliated with Licensor or any entity operating under the RLG Marks. Licensee shall not, without Licensor’s approval, make or issue any statement or any other communication for public dissemination regarding the circumstances of the termination of this Agreement or Licensee’s relationship with Licensor other than to state that Licensee is no longer associated with Licensor or the RLG Marks.

13.2 Disposition of RSSC Marks. Upon the termination of this Agreement, within thirty (30) days, Licensor will file documents with the U.S. Patent and Trademark Office and other international trademark authorities to voluntary cancel or withdraw Licensor’s trademark or service mark applications and registrations for the RSSC Marks in the United States and any other jurisdiction(s).

ARTICLE XIV MISCELLANEOUS

14.1 Severability . All provisions of this Agreement are severable. If, pursuant to the decision of any court having jurisdiction, any provision is not enforceable wholly or in part, the remainder of this Agreement will continue to be in full force and effect, and the unenforceable part(s) shall be modified as needed to give effect to the intentions of the parties as stated in the remainder of the Agreement, or if that is not possible, the unenforceable part shall be severed and cancelled from the remainder of the Agreement subject only to the special provisions stated in the remainder of this Section 14.1.

14.2 Waiver . The failure, refusal or neglect of one party to require the other party to comply with any provision of this Agreement, in whole or in part, does not constitute a waiver by the former of its right to require full compliance with the same or different provisions in the future, regardless of the acceptance of payments or performance by the party seeking compliance.

14.3 Governing Law . The interpretation, validity and enforcement of this Agreement and the relationship between the parties is subject to and governed by the laws (statutory or otherwise) of the State of New York without regard to choice of law or conflict of law principles. Licensee waives the rights and protections that are available through the franchise, business opportunity or any other laws of any state.

14.4 Venue and Jurisdiction . Except for injunctive relief sought by Licensor, which Licensor has the right to bring in a court of competent jurisdiction in the state where Licensee resides or has its principal place of business, all Claims arising out of or related to this Agreement in any way, must be commenced, filed and litigated before a court of competent jurisdiction located in New York County, New York. Licensee submits to personal jurisdiction of the state and Federal courts in such county for such purpose.

14.5 Jury Waiver . Each party knowingly and voluntarily waives the right to a trial by jury in any litigation arising under, as a result of or in connection with this Agreement or any franchise or business opportunity laws.

14.6 Successors Bound. This Agreement is binding upon the parties and their respective, heirs, successors and assigns.

14.7 Entire Agreement. As of the Amendment Effective Date, this Agreement, together with the exhibits hereto, constitutes the entire agreement between the parties with respect to the subject matter hereof, and supersedes and terminates all prior agreements and understandings, either oral or in writing, including without limitation the Original License Agreement and any Letters of Intent related to the subject matter hereof. All other representations, warranties, inducements, promises, understandings or agreements between the parties related to the subject matter hereof that are not in writing and signed by Licensor and Licensee subsequent to the date hereof, are void and unenforceable.

14.8 Modifications . Oral modifications to this Agreement, including those by way of release, amendment, waiver or otherwise, are not valid or enforceable. The parties will modify this Agreement only by a written agreement signed by a duly authorized representative of each party.

14.9 Headings . The headings of the Articles and Sections are for convenience only and do not define, limit or construe their contents.

14.10 Notices. All notices required or permitted to be given shall be in writing, given in advance, and must be delivered either personally, by fax, by United States Priority Mail or by generally reliable expedited delivery companies including Federal Express, Airborne Express and DHL. Notices by fax are deemed delivered and received upon transmission. Notices by United States Priority Mail are deemed delivered and received on the second day immediately following the day on which the notice was given to the United States Postal Service. Notices by expedited delivery are deemed delivered and received on the day immediately following the day on which the notice was given to the expedited delivery company; provided, that overnight delivery service is used. Notices shall be addressed as follows, and the parties may make any change to the information hereunder in a written notice to the other party:


To Licensor:		To Licensee:

Regent Hospitality Worldwide,		Seven Seas Cruises S. DE R.L.
LLC		8300 N.W. 33 ^rd Street, Suite 308
41 Chung Shan N, Rd. Section 2,		Miami, Florida 33122
Taipei 104, Taiwan ROC		Attention: General Counsel
Attention:		Fax: 305.514.3943
Fax 886.2.2511.9374

14.11 Execution/Counterparts. The parties may sign more than one identical copy of this Agreement, each of which shall be deemed an original. When parties sign different, but identical copies of this Agreement, the copies constitute one Agreement.

14.12 Attorneys’ Fees . All reasonable and necessary costs and expenses, including attorneys’ fees, incurred by Licensor or Licensee in enforcing any provisions of this Agreement, or in defending against any Claims made against one by the other with respect to this Agreement, whether through injunctive relief or otherwise, will be paid to the prevailing party in such action by the other party.

14.13 Actions by Others . Where Licensee is prohibited by this Agreement from directly taking any action, or where action by Licensee would constitute a default, Licensee agrees that it will not encourage, authorize or permit any other Person, directly or indirectly or under its direct or indirect control to take such action.

14.14 Performance through Others. Licensor has the right to perform all of its obligations directly or through its Affiliates or Third Party consultants. If performed through any of them, Licensee’s obligations with respect to such matters will still run directly to Licensor.

14.15 Survival . The following provisions of this Agreement shall continue in full force and effect subsequent to termination of this Agreement are: Sections 3.2 and 3.3, Article V, Article VI, Article X, Article XIII, and Article XIV.

14.16 Compliance with Laws . Notwithstanding any provision to the contrary, Licensee’s performance is subject to, and Licensee will comply with, all legal requirements, including those of all countries in which Licensee conducts business that prohibits unfair, fraudulent or corrupt business practices such as those that are comparable to the United States Foreign Corrupt Practices Act and the International Money Laundering Abatement and Anti-Terrorist Financing Act, otherwise known as the Patriot Act. Licensee shall also take all commercially reasonable efforts to ensure that all goods and services advertised or sold in connection with the RLG Marks during the term of this Agreement shall comply with all applicable legal requirements, including any local, state, and federal laws or regulations.

14.17 Third Party Beneficiaries . This Agreement is for the sole benefit of the parties and is not for the benefit of any Third Parties.

14.18 Use of Definitions/Terms . The words “ includes, ” “ such as, ” and “ for example ” are not intended to limit the listing that follows. The listings are examples or illustrations. These words should be read as if the words “ without limitation ” and “ but not limited to ” appear after them.

14.19 Copies . Photocopies and facsimiles of a signed original of this Agreement are fully binding and effective as originals.

14.20 Exhibits . All exhibits, addenda, schedules and riders attached to this Agreement are a part of it and fully incorporated into it.

14.21 Interpretation . Neither this Agreement nor any of its provisions is to be construed against or interpreted to the disadvantage of either party because a party drafted this Agreement or the provision.

14.22 Independent Expert Resolution Process . Any dispute between Licensor and Licensee with respect to the replacement of any Comparable Cruise Line and any matter required to be decided under Sections 12.3 and 12.4, shall be determined by binding arbitration before an Independent Expert to be conducted in Miami, Florida in accordance with the provisions of this Section 14.22. Either party may submit the matter for resolution by the Independent Expert, by written notice to the other party. Within ten (10) days of either party’s submission of such matter for resolution by Independent Expert, Licensee shall nominate a qualified person to be the Independent Expert by written notice to Licensor, together with a statement of the qualifications of the person nominated. Licensor shall respond in writing within ten (10) days of Licensee’s notice of its nomination, advising whether Licensor accepts Licensee’s nominee or nominating a different person to act as the Independent Expert. Licensee shall respond to Licensor within ten (10) days of Licensor’s response, advising whether Licensee accepts Licensor’s nominee. If Licensee does not nominate a qualified Independent Expert within the ten (10) day period following Licensor’s written notice of submission of a matter for resolution by Independent Expert, Licensor shall have the right to nominate a qualified Independent Expert within twenty (20) days following Licensor’s notice of submission of the matter for resolution by Independent Expert, and Licensee shall respond in writing within ten (10) days of Licensor’s notice of its nomination, advising whether Licensee accepts Licensor’s nominee or nominating a different person to act as the Independent Expert. If either Licensor or Licensee fails to nominate an

Independent Expert within the time periods provided herein, the non-responding party shall be deemed to accept the person nominated by the other party. If both Licensee and Licensor have nominated an Independent Expert and they do not mutually agree upon the person selected by either of them, the two nominees selected by Licensor and Licensee shall select a third nominee within ten (10) days of following the nomination of the second Independent Expert, and the third nominee shall be the Independent Expert. Licensor and Licensee will be entitled to make written submissions to the Independent Expert, but must provide a copy to the other party who will have the right to respond to such submission. The Independent Expert shall make a determination of the matter and advise Licensor and Licensee of such determination in writing within sixty (60) days of such person’s appointment as Independent Expert. Licensor and Licensee agree to accept the decision of the Independent Expert as final and binding, absent bad faith or fraud, and the prevailing party shall have the right to obtain a judgment against the non-prevailing party on the basis of such decision, which shall be enforceable in any court of competent jurisdiction.

IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement by their duly authorized representatives to be effective as of the date set forth above.


Signed on behalf of		)
REGENT HOSPITALITY WORLDWIDE, LLC		) )	REGENT HOSPITALITY WORLDWIDE, LLC.
acting by	AMY SHUM	)
Authorized Signatory			By:	Regent Hospitality (BVI) Limited, sole member
				For and on behalf of
				CAVAN NOMINEES LIMITED


				Authorized Signature(s)

Signed on behalf of CLASSIC CRUISES S. DE R.L.		) ) )	For and behalf of Cavan Nominees Limited, as sole director of Regent Hospitality (BVI) Ltd.
acting by		)

EXHIBIT A

(RLG Marks)


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Tao of Regent	77/223147	07/06/07	41	UNITED STATES

Circles of Interest	3,205,643 78/834349	02/06/07 03/10/06	45	UNITED STATES

The Regent Travel Concierge	3,285,882 78/834341	08/28/07 03/10/06	45	UNITED STATES

	77/173513	05/04/07	39	UNITED STATES

Regent	77/173463	05/04/07	39	UNITED STATES

Regent International Hotels	2,665,336 76/152383	12/24/02 10/24/00	42	UNITED STATES

Regent Resort	2,563,957 75/374678	04/23/02 10/16/97	42	UNITED STATES

	1,514,562 73/712307	11/29/88 02/22/88	16, 34, 35, 39, 41, 42	UNITED STATES

Regent	1,139,113 73/232554	08/26/80 09/24/79	42	UNITED STATES

	2,227,789 75/380733	03/02/99 10/29/97	25	UNITED STATES


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	1,521,777 73/712,308	01/24/89 02/22/88	16, 35, 39, 41, 42	UNITED STATES

	1,629,732 73/712,467	01/01/91 02/22/88	3	UNITED STATES

Live The Luxury	77/059,748	12/8/06	43	UNITED STATES

Live The Luxury	3,300,968 77/059,742	10/02/07 12/8/06	39	UNITED STATES

Luxury For All The Senses	2,654,664 75/639,798	11/26/02 02/11/99	42	UNITED STATES

Partner Advantage	2,810,457 78/148,892	2/3/2004 7/30/2002	35	UNITED STATES

The Regent Experience

Regent Concierge

The Regent

R (as used in the acronym RSSC)

	13250 4276	1/21/1997 1/21/1997	36, 39, 41, 42	ANDORRA

A-2


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	2039 2039	4/19/2000 4/19/1999	42	ANTIGUA

	2040 2040	6/5/2000 4/19/1999	42	ANTIGUA

	1632520 2008200	5/14/1997 11/7/1995	36	ARGENTINA

	1994423 2507681	4/29/1994 5/31/1989	35	ARGENTINA

	480561 480561	2/1/1988 2/1/1988	41	AUSTRALIA

	480566 480566	2/1/1988 2/1/1988	3	AUSTRALIA

A-3


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	480565 480565	2/1/1988 2/1/1988	16	AUSTRALIA

	480563 480563	2/1/1988 2/1/1988	35	AUSTRALIA

	500349 500349	11/25/1988 11/25/1988	42	AUSTRALIA

	480562 480562	2/1/1988 2/1/1988	39	AUSTRALIA

	458338 458338	1/13/1987 1/13/1987	21	AUSTRALIA

	453490 453490	10/10/1986 10/10/1986	42	AUSTRALIA

A-4


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	458341 458341	1/13/1987 1/13/1987	34	AUSTRALIA

	458340 458340	1/13/1987 1/13/1987	25	AUSTRALIA

	458339 458339	1/13/1987 1/13/1987	24	AUSTRALIA

	458333 458333	1/13/1987 1/13/1987	3	AUSTRALIA

	458332 458332	1/13/1987 1/13/1987	14	AUSTRALIA

	458331 458331	1/13/1987 1/13/1987	16	AUSTRALIA

A-5


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	458337 458337	1/13/1987 1/13/1987	18	AUSTRALIA

Regent	507472 507472	3/28/1989 3/28/1989	42	AUSTRALIA

	458330 458330	1/13/1987 1/13/1987	14	AUSTRALIA

	458328 458328	1/13/1987 1/13/1987	18	AUSTRALIA

	458327 458327	1/13/1987 1/13/1987	21	AUSTRALIA

	458335 458335	1/13/1987 1/13/1987	25	AUSTRALIA

	484340 484340	3/29/1988 3/29/1988	33	AUSTRALIA

	458334 458334	1/13/1987 1/13/1987	34	AUSTRALIA

	458329 458329	1/13/1987 1/13/1987	16	AUSTRALIA

A-6


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	677653 677653	11/10/1995 11/10/1995	36	AUSTRALIA

	458336 458336	1/13/1987 1/13/1987	24	AUSTRALIA

	480572 480572	2/1/1988 2/1/1988	16	AUSTRALIA

	480569 480569	2/1/1988 2/1/1988	35	AUSTRALIA

	480568 480568	2/1/1988 2/1/1988	39	AUSTRALIA

	480567 480567	2/1/1988 2/1/1988	41	AUSTRALIA

	396843 396843	9/12/1983 9/12/1983	42	AUSTRALIA

	152216 4869/93	4/20/1994 10/13/1993	25, 39, 41, 42	AUSTRIA

A-7


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	20931 20931	9/21/1999 9/10/1998	39	BAHAMAS

	20930 n/a	9/21/1999 9/10/1998	39	BAHAMAS

	1275 1307/93	1/7/1995 11/22/1993	42	BAHRAIN

	81/10688 7670	2/3/2000 12/29/1995	36	BARBADOS

	81/8333 n/a	3/16/1999 6/22/1993	42	BARBADOS

	R 510791 773556	12/18/1991 12/18/1991	16, 35, 39, 41, 42	BENELUX

	R 511105 773555	12/18/1991 12/18/1991	16, 35, 39, 41, 42	BENELUX

A-8


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	26274 n/a	7/15/1996 7/21/1994	42	BERMUDA

	BT/M/97/00372 BT/M/98/00372	9/11/1997 9/11/1997	36, 39, 41, 42	BHUTAN

	814615724 814615724	9/22/1992 12/2/1988	43	BRAZIL

	814615740 814615740	9/11/1990 12/2/1998	35	BRAZIL

	200043854 200043854	9/11/2000 8/23/2000	44	BRAZIL

	814615716 814615716	11/3/1992 12/2/1988	35	BRAZIL

A-9


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	4056 RWL2937	2/4/1994 1/12/1994	42	CAMBODIA

	4055 RWL2936	2/4/1994 1/12/1994	42	CAMBODIA

	TMA490445 072555400	2/24/1998 3/26/1993	3, 16, 34, 35, 39, 42 Gdl, Gd2, Svl, Sv2, Sv3, Sv4	CANADA

Live the Luxury	135078600	6/8/2007	39, 43 Srv 1, Srv 2, Srv 3	CANADA

Regent	133911800	3/13/2007	43 Srv 1	CANADA

Regent	134660900	5/9/2007	39 Svl	CANADA

	134659600	5/9/2007	39 Svl	CANADA

	TMA478149 0725652	6/20/1997 3/26/1993	16, 35, 39, 41, 42 Gds, Srvl, Srv2, Srv3, Srv4	CANADA

A-10


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	778373 778373	2/21/1995 9/30/1993	42	CHINA P.R.

	845971 845971	6/7/1996 3/7/1994	42, 44	CHINA P.R.

	841852 841852	5/21/1996 6/4/1994	36	CHINA P.R.

Live the Luxury	6094569	6/7/2007	43	CHINA P.R.

	4284146	9/23/2004	36	CHINA P.R.

	4284147	9/23/2004	43	CHINA P.R.

	4284145	9/23/2004	35	CHINA P.R.

	4284144	9/23/2004	43	CHINA P.R.

	320565 320565	8/10/1988 9/10/1987	16	CHINA P.R.

	321319 321319	8/20/1988 9/10/1987	21	CHINA P.R.

A-11


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	321305 321305	8/20/1988 9/10/1987	3	CHINA P.R.

	327643 327643	10/20/1988 9/10/1987	24	CHINA P.R.

	831808 831808	4/14/1996 6/4/1994	36	CHINA P.R.

	777402 777402	2/7/1995 9/30/1993	42	CHINA P.R.

	327647 327647	10/20/1988 9/10/1987	24	CHINA P.R.

	321306 321306	8/10/1988 9/10/1987	3	CHINA P.R.

	320566 320566	8/10/1988 9/10/1987	16	CHINA P.R.

	321318 321318	8/20/1988 9/10/1987	21	CHINA P.R.

A-12


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	163164 2006-0010	10/20/2006 1/2/2006	43	COSTA RICA

	165610 2006-5105	1/26/2007 6/14/2006	35	COSTA RICA

	165609 2006-5106	1/26/2007 6/14/2006	41	COSTA RICA

	165608 2006-5107	1/26/2007 6/14/2006	44	COSTA RICA

Live the Luxury	2007-5890	6/4/2007	43	COSTA RICA

Regent	2007-2683	3/21/2007	35	COSTA RICA

Regent	2007-2685	3/21/2007	41	COSTA RICA

Regent	2007-2684	3/21/2007	43	COSTA RICA

A-13


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Regent	2007-2686	3/21/2007	44	COSTA RICA

	163163 2006-0011	10/20/2006 1/2/2006	43	COSTA RICA

	165646 2006-5073	1/26/2007 6/14/2006	35	COSTA RICA

	165648 2006-5071	1/26/2007 6/14/2006	41	COSTA RICA

	165647 2006-5072	1/26/2007 6/14/2006	44	COSTA RICA

	Z20040471 Z20040471A	3/22/2004 3/22/2004	35, 43, 44	CROATIA

Live the Luxury	Z20071018A	6/1/2007	43	CROATIA

Regent International Hotels	Z20040469 Z20044069A	3/22/2004 3/22/2004	43	CROATIA

A-14


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	Z20040470 Z20040470A	3/22/2004 3/22/2004	35, 43, 44	CROATIA

	124065 2225/95	6/20/1996 12/12/1995	36	CUBA

	38525 38525	5/28/1993 5/28/1993	42	CYPRUS

	156911 2006-51487	10/16/2006 7/28/2006	35, 36, 43, 44	DOMINICAN REPUBLIC

	156801 2006-51488	10/16/2006 7/28/2006	35, 36, 43, 44	DOMINICAN REPUBLIC

	87197 87197	11/1/1997 6/7/1993	42	EGYPT

	0153999 0153999	11/20/2001 4/1/1996	36, 39, 41,42	EUROPEAN COMMUNITY

A-15


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Live the Luxury	5962303	6/1/2007	39, 43	EUROPEAN COMMUNITY

Regent	5876321	5/4/2007	39	EUROPEAN COMMUNITY

	5876289	5/4/2007	36, 39, 41, 43	EUROPEAN COMMUNITY

	0153957 0153957	2/10/2000 4/1/1996	36, 39, 41, 42	EUROPEAN COMMUNITY

The Regent London	2184232 2184232	1/22/2004 4/19/2001	3, 25, 36, 39, 41, 42	EUROPEAN COMMUNITY

	20144 n/a	11/15/1989 9/15/1988	48	FIJI

	20139 n/a	11/15/1989 9/15/1988	38	FIJI

	20141 n/a	11/15/1989 9/15/1988	50/10	FIJI

A-16


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
The Regent	20136 n/a	11/15/1989 9/15/1988	50/10	FIJI

The Regent	20131 n/a	11/14/1989 9/15/1988	39	FIJI

The Regent	20130 n/a	11/14/1989 9/15/1988	38	FIJI

Regent Resort	39745927 39745927	11/12/1997 9/25/1997	39, 41, 42	GERMANY

The Regent - Frankfurt	1159270 R 47481/42 Wz	5/22/1990 12/8/1988	42	GERMANY

	1159572 R 47482/42 Wz	5/31/1990 12/8/1988	42	GERMANY

	1,159,989 R 46295/43 Wz	6/12/1990 2/2/1988	35, 39, 41, 42	GERMANY

	114288 114288	10/17/1995 5/20/1993	25, 42	GREECE

	106221 1998-04703	9/26/2000 6/23/1998	42	GUATEMALA

A-17


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	106220 1998-04702	9/26/2000 6/23/1998	42	GUATEMALA

	1991B04293 88/01499	12/31/1991 3/25/1988	16	HONG KONG

	1991B04292 88/01499	12/31/1991 3/25/1988	3	HONG KONG

	1996/B02004 92/07080	3/25/1996 3/2/1992	39	HONG KONG

	1995/B08050 92/07082	9/25/1995 3/2/1992	42	HONGKONG

	1995/B08049 92/07079	9/25/1995 3/2/1992	35	HONG KONG

A-18


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	1996B05421 92/07081	6/13/1996 3/2/1992	41	HONG KONG

	200013881 95/13778	10/18/2000 10/31/1995	36	HONG KONG

	200014262 96/09220	10/26/2000 7/26/1996	36	HONG KONG

	19970334 96/08962	10/21/1997 7/22/1996	35, 43	HONG KONG

	199601663 92/07083	2/22/1996 3/2/1992	39	HONG KONG

	199104132 88/01520A	12/19/1991 3/25/1988	16	HONG KONG

	199610742 92/07086	11/26/1996 3/2/1992	42	HONG KONG

	199610741 92/07085	11/26/1996 3/2/1992	41	HONG KONG

A-19


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	199500682 92/07084	1/24/1995 3/2/1992	35	HONG KONG

	138988 M 93 02403	1/9/1996 5/19/1993	42	HUNGARY

	1383232 1383232	9/8/2005 9/8/2005	42	INDIA

	485025	2/1/1988	3	INDIA

	485026	2/1/1988	16	INDIA

	1383231	9/8/2005	42	INDIA

A-20


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	485023 485023	2/1/1988 2/1/1988	3	INDIA

	485022 485022	2/1/1988 2/1/1988	16	INDIA

	265962 4378/88	3/23/1998 3/19/1991	3, 16, 34, 42	INDONESIA

	265962 4378/88	3/23/1998 3/19/1991	21	INDONESIA

	265962 4378/88	3/23/1998 3/19/1991	34	INDONESIA

	302514 n/a	4/1/1993 4/1/1993	43	INDONESIA

A-21


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	265962 4378/88	3/23/1996 3/19/1991	16	INDONESIA

	260405 n/a	6/16/1990 3/23/1988	3	INDONESIA

	302513 n/a	4/1/1993 4/1/1993	43	INDONESIA

	260405 n/a	6/16/1990 3/23/1988	16	INDONESIA

	260405 n/a	6/16/1990 3/23/1988	21	INDONESIA

THE REGENT CLUB	360456 J9514426	5/30/1996 8/14/1995	42	INDONESIA

A-22


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	201591 201591	7/1/1996 1/29/1996	42	IRELAND

	201590 201590	7/1/1996 1/29/1996	41	IRELAND

	201589 201589	7/1/1996 1/29/1996	36	IRELAND

	200768 200768	7/1/1996 1/29/1996	41	IRELAND

	200767 200767	7/1/1996 1/29/1996	36	IRELAND

	201128 201128	7/1/1996 1/29/1996	42	IRELAND

A-23


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	101648 101648	12/4/1997 11/1/1995	36	ISRAEL

	131005 131005	1/3/2001 9/27/1999	42	ISRAEL

	844169 RM/98/4046	4/24/2001 2/8/1988	3, 16, 34, 35, 39, 41, 42	ITALY

Regent	993358 RM/2002/5041	2/21/2006 9/16/2002	3, 16, 25, 34	ITALY

	720620 RM/2005/5773	11/4/2005 11/6/1995	36	ITALY

REGENT INTERNATIONAL HOTELS	825313 RM/98/17	10/4/2000 1/5/1998	42	ITALY

A-24


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
The Regent	993361 RM/2002/5045	2/21/2006 9/16/2002	36, 39, 43	ITALY

	825722 RM/98/475	8/4/2000 2/3/1998	3, 16, 34, 35, 39, 41, 42	ITALY

	29259 16/1680	11/10/1997 6/25/1993	16	JAMAICA

	3107433 H04-281342	12/26/1995 9/30/1992	41	JAPAN

	2135622 S60-122714	4/28/1989 12/10/1985	6, 9, 14, 16, 19, 20, 21	JAPAN

	3331711 H04-281344	7/18/1997 9/30/1992	42	JAPAN

A-25


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	4096420 H07-114882	12/26/1997 11/6/1995	36	JAPAN

Regent Resort	4248705 H09-164188	3/12/1999 10/2/1997	42	JAPAN

	3331710 H04-281343	7/18/1997 9/30/1992	42	JAPAN

	42471 42471	5/29/1996 5/29/1996	16	JORDAN

REGENT INTERNATIONAL	42472 42472	7/15/1996 7/15/1996	16	JORDAN

	42346 42346	5/11/1996 5/11/1996	16	JORDAN

A-26


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	12148	6/18/1999	3, 25, 36, 39, 41, 42	KAZAKHSTAN

	12149	6/18/1998	3, 25, 36, 39, 41, 42	KAZAKHSTAN

	9899 12147	1/13/2000 6/18/1998	3, 25, 36, 37, 39, 42	KAZAKHSTAN

	9898 12146	1/13/2000 6/18/1998	3, 25, 36, 37, 39, 42	KAZAKHSTAN

A REGENT INTERNATIONAL HOTEL	410026603000 41-1993-0002210	4/4/1995 4/23/1993	43	KOREA SOUTH

A-27


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	4100137150000 41-1989-0002793	3/13/1991 10/24/1989	35, 39, 41, 42	KOREA SOUTH

	4002058710000 40-1989-0026603	11/27/1990 10/24/1989	2, 16	KOREA SOUTH

	4002095730000 40-1989-0026605	2/7/1991 10/24/1989	9, 16	KOREA SOUTH

	4002058720000 40-1989-0026606	11/27/1990 10/24/1989	2, 16	KOREA SOUTH

	4002184370000 40-1990-0010653	8/7/1991 4/17/1990	3	KOREA SOUTH

A-28


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	4002095740000 40-1989-0026607	2/7/1991 10/24/1989	9, 16	KOREA SOUTH

	4002184300000 40-1990-0010654	8/7/1991 4/17/1990	3	KOREA SOUTH

	4100137160000 41-1989-0002794	3/13/1991 10/24/1989	35, 39, 41, 42	KOREA SOUTH

	4002131230000 40-1990-0010655	4/24/1991 4/17/1990	34	KOREA SOUTH

	4100385720000 41-1995-0011991	10/21/1997 12/12/1995	37	KOREA SOUTH

	4100394850000 41-1995-0011990	12/23/1997 12/12/1995	36	KOREA SOUTH

A-29


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	41-2007-0009070	4/4/2007	43, 44	KOREA SOUTH

	4002970330000 40-1993-0013759	8/27/1994 4/23/1993	9, 16	KOREA SOUTH

	4002014180000 40-1989-0026602	9/24/1990 10/24/1989	2, 16	KOREA SOUTH

	83866	3/13/2007	42	KUWAIT

Live the Luxury	86176	6/2/2007	42	KUWAIT

	30630 33300	4/4/2000 4/6/1996	42	KUWAIT

A-30


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	2066 2310	2/21/1994 7/21/1993	25	LAOS

	2067 2310	2/21/1994 7/21/1993	42	LAOS

	65668 65668	4/26/1995 4/26/1995	3, 16, 18, 25, 36, 39, 41, 42	LEBANON

	97020493 97020493	11/1/2006 12/1/1997	41	MALAYSIA

	9702492	12/1/1997	39	MALAYSIA

	9702491 9702491	11/1/2006 12/1/1997	43	MALAYSIA

A-31


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	97020494 97020494	12/1/1997 12/1/1997	36	MALAYSIA

	88001482 88001482	3/31/1988 3/31/1988	16	MALAYSIA

	88001483 88001483	3/31/1988 3/31/1988	3	MALAYSIA

	84000695 84000695	2/13/1984 2/13/1984	16	MALAYSIA

Live the Luxury	07010642	6/5/2007	43	MALAYSIA

Regent			43	MALAYSIA

A-32


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	97020479 97020479	7/12/2007 12/1/1997	36	MALAYSIA

	97020480	12/1/1997	43	MALAYSIA

A-33


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	97020482 97020482	12/1/1997 12/1/1997	39	MALAYSIA

	88001484 88001484	3/31/1988 3/31/1988	16	MALAYSIA

	84000696 84000696	2/13/1984 2/13/1984	16	MALAYSIA

	97020481 97020481	12/1/1997 12/1/1997	41	MALAYSIA

	952232 338438	9/14/2006 7/3/1998	36	MEXICO

	898900 337079	9/12/2005 6/23/1998	42	MEXICO

A-34


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	597751 344643	1/22/1999 8/21/1998	16	MEXICO

	629438 344646	10/26/1999 8/21/1998	21	MEXICO

	599478 344645	1/29/1999 8/21/1998	24	MEXICO

	953247 344644	9/20/2006 8/21/1998	26	MEXICO

	596122 344642	12/10/1998 8/21/1998	34	MEXICO

A-35


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	603589 350410	3/26/1999 10/13/1998	28	MEXICO

	629423 338430	10/26/1999 7/3/1998	3	MEXICO

	629428 338439	10/26/1999 7/3/1998	25	MEXICO

	629427 338437	10/26/1999 7/3/1998	39	MEXICO

	643566 338436	2/25/2000 7/3/1998	41	MEXICO

A-36


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	898899 337078	9/12/2005 6/23/1998	42	MEXICO

Live the Luxury	1002454 859959	9/17/2007 6/7/2007	43	MEXICO

Regent	854672	5/16/2007	43	MEXICO

Regent	1005867 854671	10/9/2007 5/16/2007	44	MEXICO

	870431 337080	2/28/2005 6/23/1998	42	MEXICO

	338433	7/3/1998	36	MEXICO

	805924 344784	9/8/2003 8/24/1998	21	MEXICO

	597750 344638	1/22/1999 8/21/1998	16	MEXICO

A-37


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	682018 350409	12/20/2000 10/13/1998	28	MEXICO

	844297 616115	7/26/2004 8/25/2003	43	MEXICO

	629426 338435	10/26/1999 7/3/1998	3	MEXICO

	672882 338434	9/29/2000 7/3/1998	25	MEXICO

	629425 338432	10/26/1999 7/3/1998	39	MEXICO

	629424 338431	10/26/1999 7/3/1998	41	MEXICO

A-38


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	599023 344641	1/28/1999 8/21/1998	24	MEXICO

	599022 344640	1/28/1999 8/21/1998	26	MEXICO

	180752 180752	5/16/1996 5/2/1988	39	NEW ZEALAND

	171032 171032	9/26/1990 3/18/1987	34	NEW ZEALAND

	171030 171030	9/26/1990 3/18/1987	24	NEW ZEALAND

A-39


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	180753 180753	6/25/1996 5/2/1988	41	NEW ZEALAND

	180751 180751	6/25/1996 5/2/1988	35	NEW ZEALAND

	180754 180754	6/25/1998 5/2/1988	42	NEW ZEALAND

	171031 171031	9/26/1990 3/18/1987	25	NEW ZEALAND

	171029 171029	9/26/1990 3/18/1987	21	NEW ZEALAND

A-40


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	171028 171028	1/29/1992 3/18/1987	18	NEW ZEALAND

	171025 171025	9/26/1990 3/18/1987	3	NEW ZEALAND

	171026 171026	9/26/1990 3/18/1987	14	NEW ZEALAND

	171027 171027	6/25/1996 3/18/1987	16	NEW ZEALAND

	171017 171017	7/17/1991 3/18/1987	3	NEW ZEALAND

A-41


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	171019 171019	5/16/1996 3/18/1987	16	NEW ZEALAND

	171022 171022	2/26/1991 3/18/1987	24	NEW ZEALAND

	171023 171023	2/26/1991 3/18/1987	25	NEW ZEALAND

	171024 171024	2/26/1991 3/18/1987	34	NEW ZEALAND

	171018 171018	7/26/1991 3/18/1987	14	NEW ZEALAND

	171020 171020	10/25/1991 3/18/1987	18	NEW ZEALAND

	171021 171021	2/26/1991 3/18/1987	21	NEW ZEALAND

A-42


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	180750 180750	5/2/1988 5/2/1988	42	NEW ZEALAND

	177947 177947	8/20/1990 3/3/1988	3	NEW ZEALAND

	180747 180747	4/27/1994 5/2/1988	35	NEW ZEALAND

	180748 180748	4/27/1994 5/2/1988	39	NEW ZEALAND

	180749 180749	4/27/1994 5/2/1988	41	NEW ZEALAND

	177948 177948	9/26/1990 3/3/1988	16	NEW ZEALAND

A-43


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	172754 19932401	5/2/1996 5/19/1993	25, 39, 41, 42	NORWAY

	11687 11687	7/24/2001 6/5/1995	42	OMAN

	196061	5/22/2004	43	PAKISTAN

	196060	5/22/2004	42	PAKISTAN

	4-1996-109660 4-1996-109660	10/30/2004 7/10/1996	36	PHILIPPINES

	4-1993-90100 4-1993-90100	12/19/2005 12/28/1993	42	PHILIPPINES

A-44


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	84906 121983	5/9/1995 6/1/1993	25, 42	POLAND

	310636 MNA 310636 MNA	4/18/1996 6/2/1995	36	PORTUGAL

	58787 N/A	10/5/2004 1/17/2003	42	PUERTO RICO

	58785 N/A	10/14/2004 1/17/2003	42	PUERTO RICO

	12992 12992	3/1/2000 2/22/1995	42	QATAR

	360/91 360/91	11/29/1995 3/12/1995	42	SAUDI ARABIA

A-45


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	306/62 306/62	5/8/1994 6/19/1993	43	SAUDI ARABIA

	T8908096H T8908096H	12/7/1989 12/7/1989	16	SINGAPORE

	T9102880C T9102880C	3/13/1991 3/13/1991	39	SINGAPORE

	T9102881A T9102881A	3/13/1991 3/13/1991	41	SINGAPORE

	T9102882Z T9102882Z	3/13/1991 3/13/1991	42	SINGAPORE

A-46


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	T91/02884F T91/02884F	3/13/1991 3/13/1991	41	SINGAPORE

	T9102885D T9102885D	3/13/1991 3/13/1991	42	SINGAPORE

	T9102883H T9102883H	4/30/1996 3/13/1991	39	SINGAPORE

Live the Luxury	T0715591H	7/13/2007	43	SINGAPORE

Regent	T0715590Z	7/13/2007	41, 43, 44, 45	SINGAPORE

	T89080731 T89080731	12/6/1989 12/6/1989	16	SINGAPORE

	T9502185D T9502185D	9/4/2001 3/11/1995	36	SINGAPORE

A-47


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	T9102879Z T9102879Z	8/31/1995 3/13/1991	42	SINGAPORE

	T9102877C T9102877C	3/31/1994 3/13/1991	39	SINGAPORE

	T9102878A T9102878A	6/30/1994 3/13/1991	41	SINGAPORE

	1995/13829 1995/13829	2/4/1999 10/17/1995	42	SOUTH AFRICA

	1995/13828 1995/13828	10/17/1995 10/17/1995	36	SOUTH AFRICA

	66934 66934	11/27/1995 6/7/1993	42	SRI LANKA

A-48


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	4158 4158	8/19/1997 3/15/1994	50	ST. KITTS & NEVIS

	211/1998 211/1998	6/22/1999 9/8/1998	42	ST. LUCIA

	98000212 98000212	5/22/1999 9/8/1998	42	ST. LUCIA

	334989 1993/04831	2/25/2000 5/25/1993	42	SWEDEN

	411095 5221/1993	4/1/1993 4/1/1993	41, 42	SWITZERLAND

A-49


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	362719 569/88	1/28/1988 1/28/1988	3, 16, 34	SWITZERLAND

	362720 570/88	1/28/1988 1/28/1988	3, 16, 34	SWITZERLAND

	P-411096 5222/1993	4/1/1993 4/1/1993	41, 42	SWITZERLAND

	300698 7606804	10/1/1985 2/14/1985	56	TAIWAN

	18388 7405772	9/1/1985 2/7/1985	7	TAIWAN

A-50


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	18263 7406794	9/1/1985 5/14/1985	1	TAIWAN

Live the Luxury	96026582	6/5/2007	43	TAIWAN

Regent	18262 7406808	9/1/1985 2/14/1985	1	TAIWAN

Regent	19527 7405773	12/16/1985 2/7/1985	7	TAIWAN

Regent (in Chinese characters)	18261 7406779	9/1/1985 2/14/1985	1	TAIWAN

Regent (in Chinese characters)	18387 7406781	9/1/1985 2/14/1985	7	TAIWAN

	43685 7831287	3/1/1990 7/3/1989	1	TAIWAN

	43137 7831286	2/1/1990 7/3/1989	7	TAIWAN

A-51


Mark	Reg. No./ Serial No.	Reg. Dale/ App. Date	Class	Country of Registration
	BOR344 225341	8/25/1993 3/17/1992	35	THAILAND

	KOR83185 369666	10/12/1989 10/6/1988	16	THAILAND

	BOR701 225337	1/30/1994 3/17/1992	39	THAILAND

	BOR1185 225336	7/15/1994 3/17/1992	41	THAILAND

	BOR598 225340	12/15/1993 3/17/1992	42	THAILAND

A-52


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	KOR83179 369665	10/10/1989 10/6/1988	34	THAILAND

	KOR83979 369664	10/9/1989 10/6/1988	34	THAILAND

	KOR83978 369662	10/9/1989 10/6/1988	34	THAILAND

	KOR83180 369663	10/9/1989 10/6/1988	3	THAILAND

Live the Luxury	663183	6/6/2007	43	THAILAND

	BOR10088 284072	5/23/2000 4/18/1995	36	THAILAND

A-53


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	59019 93833	7/30/1976 7/30/1976	16	THAILAND

Regent of Bangkok	KOR116650 417212	4/29/1980 4/29/1980	16	THAILAND

Regent Resort	BOR22502 345452	10/3/1997 10/3/1997	42	THAILAND

	BOR2487 225344	2/10/1995 3/17/1992	35	THAILAND

	BOR1178 225343	7/15/1994 3/17/1992	39	THAILAND

	KOR84804 369661	10/9/1989 10/6/1988	16	THAILAND

	BOR2552 225342	2/17/1995 3/17/1992	41	THAILAND

A-54


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	BOR11711 225361	2/2/2001 3/17/1992	42	THAILAND

	KOR83976 369667	6/8/1990 10/6/1988	34	THAILAND

	KOR83508 369659	10/10/1989 10/6/1988	3	THAILAND

	KOR97451 388582	1/11/1990 8/16/1989	3	THAILAND

	KOR83120 369668	10/9/1989 10/6/1988	34	THAILAND

	KOR83507 369660	10/9/1989 10/6/1988	34	THAILAND

A-55


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	111107 N/A	3/20/1989 3/20/1989	8, 14, 16, 18, 21, 24, 25, 32, 33, 34	TURKEY

	2002/001126 2002/001126	1/22/2002 1/22/2002	36, 41, 43, 44	TURKEY

	105323 6738/88	2/2/1988 2/2/1988	3, 16, 34	TURKEY

	192566 1997/10841	7/29/1997 7/29/1997	36, 39, 41, 42	TURKEY

	1998/16708 1998/16708	11/25/1998 11/25/1998	14, 25, 33	TURKEY

A-56


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	14308 14308	6/5/2006 4/13/2006	43	TURKS & CAICOS

Live the Luxury	14949 14949	8/14/2007 8/4/2007	43	TURKS & CAICOS

Regent	14114 14114	1/31/2006 11/29/2005	43	TURKS & CAICOS

	14307 14307	6/5/2006 4/13/2006	43	TURKS & CAICOS

			43	UKRAINE

			43	UKRAINE

A-57


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	13095 22154	12/8/1997 6/16/1997	36	UNITED ARAB EMIRATES

	13096 22155	12/8/1997 6/16/1997	42	UNITED ARAB EMIRATES

Live the Luxury	95647	6/5/2007	43	UNITED ARAB EMIRATES

Regent	13488 14966	2/10/1998 2/19/1996	36	UNITED ARAB EMIRATES

	10573 11593	6/14/1997 6/16/1995	42	UNITED ARAB EMIRATES

	B1333872 B1333872	1/25/1991 2/2/1988	43, 44, 45	UNITED KINGDOM

A-58


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	2042642 2042642	5/9/1997 10/25/1995	36	UNITED KINGDOM

	B1292266 B1292266	11/6/1986 11/6/1986	42	UNITED KINGDOM

A-59


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Regent Resort	2146343 2146343	7/3/1998 9/26/1997	42	UNITED KINGDOM

	1333865 1333865	5/15/1992 2/2/1988	43, 44, 45	UNITED KINGDOM

LONDON	1371411 1371411	12/14/1990 1/25/1989	43	UNITED KINGDOM

	S013961 98-019680	9/28/2000 10/26/1998	42	VENEZUELA

	S013962 98-019681	9/28/2000 10/26/1998	42	VENEZUELA

	S013963 98-019682	9/28/2000 10/26/1998	42	VENEZUELA

A-60


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
	23297 11551	12/6/1996 3/18/1993	41, 42	VIETNAM

	2667 3622	5/4/1991 4/5/1991	42	VIETNAM

	34107 30622	5/25/2000 9/11/1996	38, 39	VIETNAM

	23296 11550	12/6/1996 3/18/1993	41, 42	VIETNAM

A-61

EXHIBIT B

(Intentionally left blank)

EXHIBIT C

(Intentionally left blank)

EXHIBIT D

(Seven Seas Marks)


Mark	Reg No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Seven Seas Explorer	2,700,599 78/140,790	3/25/2003 7/2/2002	41	UNITED STATES

Seven Seas Navigator	2,571,631 78/066,846	5/21/2002 6/1/2001	39	UNITED STATES

Seven Seas Mariner	2,540,614 78/066,842	2/19/2002 6/1/2001	39	UNITED STATES

Seven Seas Cruises	77/173,487	5/4/2007	39, 43	UNITED STATES

Seven Seas Voyager	77/173,396	5/4/2007	39	UNITED STATES

Seven Seas Society	77/014,405	10/5/2006	39	UNITED STATES

Unique Discoveries	3,271,297 77/017,679	7/31/2007 10/10/2006	16	UNITED STATES

Luxury Goes Exploring	2,661,799 76/207,391	12/17/2002 2/8/2001	39, 41, 42	UNITED STATES

Song of Flower	1,735,322 74/252,848	11/24/1992 2/25/1992	39	UNITED STATES

Seven Seas Adventurer

Seven Seas Diamond

Seven Seas Discoverer

Seven Seas Endeavor

Seven Seas Cruise Line

Seven Seas

SSC


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Luxury Goes Exploring	TMA594572 111200100	11/12/2003 8/8/2001	39, 41, 42 Svl, Sv2, Sv3	CANADA

Seven Seas Cruises	134659800	5/9/2007	39 Svl, Sv2, Sv3	CANADA

Seven Seas Mariner	TMA609580 111882600	5/6/2004 10/18/2001	39 Srv	CANADA

Seven Seas Navigator	TMA609256 111882500	5/4/2004 10/18/2001	39 Srv	CANADA

Seven Seas Society	132283700	11/3/2006	35, 39 Srv	CANADA

Seven Seas Voyager	134659700	5/9/2007	39 Srv	CANADA

Unique Discoveries	132157000	10/25/2006	16 Gds	CANADA

Luxury Goes Exploring	2327393 2327393	11/5/2002 8/2/2001	39, 41, 42	EUROPEAN COMMUNITY

Seven Seas Adventurer	2301760 2301760	12/9/2002 7/16/2001	39, 41, 42	EUROPEAN COMMUNITY

	2898344 2898344	3/17/2004 10/14/2002	39, 41, 43	EUROPEAN COMMUNITY

Seven Seas Cruises	5875951	5/4/2007	39, 41, 43	EUROPEAN COMMUNITY

Seven Seas Diamond	2889707 2889707	3/9/2004 10/14/2002	39	EUROPEAN COMMUNITY

D-2


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Seven Seas Discoverer	2416212 2416212	2/27/2003 10/18/2001	39	EUROPEAN COMMUNITY

Seven Seas Endeavor	2302602 2302602	7/31/2002 7/16/2001	39, 41, 42	EUROPEAN COMMUNITY

Seven Seas Explorer	2409852 2409852	11/5/2002 10/15/2001	39	EUROPEAN COMMUNITY

Seven Seas Mariner	2287159 2287159	11/29/2002 7/4/2001	39, 41, 42	EUROPEAN COMMUNITY

Seven Seas Navigator	2288116 2288116	10/10/2002 7/4/2001	39, 41, 42	EUROPEAN COMMUNITY

Seven Seas Voyager	5875927	5/4/2007	39, 41, 42	EUROPEAN COMMUNITY

D-3

EXHIBIT E

(Intentionally left blank)

EXHIBIT F

(Licensee’s Domain Names)

7seascruises.biz

7seascruises.net

7seascruises.org

7seascruisesonline.com

7seascruisesonline.net

7seascruisesonline.org

diaadmin.com

luxurygoesexploring.com

maradmin.com

mysevenseas.com

mysevenseas.net

navadmin.com

pauadmin.com

sellssc.com

sevenseascruiseline.com

sevenseascruiseline.net

sevenseascruiseline.org

sevenseascruises.biz

sevenseascruises.com

sevenseascruises.org

sevenseascruisesonline.com

sevenseascruisesonline.net

sevenseascruisesonline.org

sevenseasonline.net

sevenseasonline.org

sevenseasruisesonline.com

sevenseasruisesonline.net

sevenseasruisesonline.org

sofadmin.com

sscdiamond.com

sscmail.com

sscmariner.com

sscnavigator.com

sscpaulgauguin.com

sscsongofflower.com

sscvoyager.com

voyadmin.com

voyagestodiscover.com

voyagestoexplore.com

EXHIBIT G

(Licensee’s Domain Names)

24hourregentsevenseascruises.com

affordableregentcruises.com

affordable-regent-cruises.com

agents-for-regent-cruises.com

allregentcruises.com

authorized-agents-for-regent-cruises.com

backtobackregentcruises.com

back-to-back-regent-cruises.com

bestregentcruise.com

bookregent.com

book-regent-cruises-here.com

book-regent-seven-seas-cruises-here.com

book-your-regent-cruise-here.com

buyingaregentcruise.com

buying-a-regent-cruise.com

buyingregentcruises.com

buying-regent-cruises.com

cruiseregent.com

cruise-regent.com

cruiseregent7seas.com

cruiseregentcruises.com

cruise-regent-cruises.com

cruisewithregentsevenseas.com

discountregent.com

discountregentcruise.com

discountregentcruises.com

discount-regent-cruises.com

freeregentcruises.com

free-regent-cruises.com

friendsofregentcruises.com

friends-of-regent-crui ses.com

friendsofregentsevenseascruises.com

friends-of-regent-seven-seas-cruises.com

goregent.net

goregentcruise.com

goregentcruise.net

hesaidshesaidregentcruises.com

he-said-she-said-regent-cruises.com

idiscount-regentsevenseas-cruises.com

justregentcruises.com

letstalkregentcruises.com

let-talk-regent-cruises.com

luxurycruisesregent.com

luxury-cruises-regent.com

luxurycruisesregentcruises.com

luxury-cruises-regent-cruises.com

luxury-cruises-regent-cruises-lines.com

luxuryregentcruises.com

luxuryregentcruises.net

luxury-regent-seven-seas-cruises.com

myregentcruise.com

number1regentcruise.com

onbuyingaregentcruise.com

on-buying-a-regent-cruise.com

onbuyingregentcruises.com

on-buying-regent-cruises.com

onregentcruiseline.com

on-regent-cruise-line.com

onregentcruises.com

on-regent-cruises.com

onregentcruiseships.com

on-regent-cruise-ships.com

penthousesonregentcruises.com

penthouses-on-regent-cruises.com

platinumcardregentcruises.com

platinum-card-regent-cruises.com

premiereregentcruises.com

premierregentcruise.com

recommended-agents-for-regent-cruises.com

recommended-agents-for-regent-seven-seas-cruises.com

regent7sea.com

regent7seascruise.com

regent7seascruisepros.com

regent-7-seas-cruise-pros.com

regent7seascruisesonline.com

regent-7seas-cruises-online.com

regent7seasdiamond.com

regent7seasmariner.com

regent7seasnavigator.com

regent7seaspaulgauguin.com

regent7seasvoyager.com

regentblog.com

regentcruise.biz

regent-cruise.biz

regentcruise.co.uk

regentcruise.net

regent-cruise.us

regentcruiseagent.com

G-2

regentcruiseblog.com

regent-cruise-blog.com

regentcruiseblogs.com

regent-cruise-blogs.com

regentcruisebuyersguide.com

regent-cruise-buyers-guide.com

regentcruisechecklist.com

regent-cruise-checklist.com

regentcruised.com

regentcruiseexperience.com

regentcruiseexperts.com

regentcruiseline.com

regentcruiselines.com

regentcruiselineships.com

regent-cruise-line-ships.com

regentcruiselinetips.com

regent-cruise-line-tips.com

regentcruiseplanner.com

regentcruisepuzzles.com

regent-cruise-puzzles.com

regentcruisequestions.com

regent-cruise-questions.com

regentcruisequestionstoask.com

regent-cruise-questions-to-ask.com

regentcruiser.com

regentcruisereview.com

regent-cruise-review.com

regentcruisereviews.com

regent-cruise-re views.com

regent-cruises.at

regentcruises.biz

regent-cruises.ch

regentcruises.co.uk

regent-cruises.com

regent-cruises.de

regentcruises.info

regentcruises.mobi

regentcruises.net

regentcruisesaver.com

regentcruisesblog.com

regent-cruises-blog.com

regentcruisesblogs.com

regent-cruises-blogs.com

regentcruisesbuyersguide.com

regent-cruises-buyers-guide.com

regentcruiseschecklist.com

G-3

regent-cruises-checklist.com

regent-cruises-discount.com

regentcruisesdiscounts.com

regent-cruises-discounts.com

regentcruisesecrets.com

regentcruise-secrets.com

regent-cruise-secrets.com

regentcruise-secrets-revealed.com

regentcruisesforfree.com

regent-cruises-for-free.com

regentcruiseship.com

regentcruiseships.com

regent-cruise-ships.com

regentcruisespuzzles.com

regent-cruises-puzzles.com

regentcruisesquestions.com

regent-cruises-questions.com

regentcruisesquestionstoask.com

regent-cruises-questions-to-ask.com

regentcruisesreview.com

regent-cruises-review.com

regentcruisesreviews.com

regent-cruises-reviews.com

regentcruises-secrets.com

regent-cruises-secrets.com

regentcruises-secrets-revealed.com

regentcruisesships.com

regent-cruises-ships.com

regentcruisestalk.com

regent-cruises-talk.com

regentcruisestestimonials.com

regent-cruises-testimonials.com

regentcruisestips.com

regent-cruises-tips.com

regentcruisesvacationguide.com

regent-cruises-vacations.com

regentcruisetestimonials.com

regent-cruise-testimonials.com

regentcruisetips.com

regent-cruise-tips.com

regentcruisevideos.com

regentlines.com

regent-luxury-cruise.com

regent-luxurycruiseexperts.com

regentmariner.com

regentnavigator.com

G-4

regentpassenger.com

regentpaulgauguin.com

regentsevensea.com

regentsevenseacruises.com

regentsevenseas.biz

regentsevenseas.com

regent-seven-seas.com

regentsevenseas.org

regentsevenseascruise.com

regent-seven-seas-cruise.com

regentsevenseascruise.net

regent-seven-seas-cruise-line.com

regentsevenseascruiselinesdiamondcruiseshipshanseaticcruises.com

regent-seven-seas-cruise-line-spcials.com

regent-seven-seas-cruise-line-specials.com

regent-seven-seas-cruise-reviews.com

regentsevenseascruises.co.uk

regentsevenseascruises.com

regentsevenseascruises.net

regentsevenseascruises.travel

regentsevenseascruisesdeals.com

regent-seven-seas-cruises-discounts.com

regentsevenseascruisespecialists.com

regent-seven-seas-cruises-specials.com

regentsevenseascruisestravelclub.com

regent-seven-seas-cruises-travel-club.com

regentsevenseasdiamond.com

regentsevenseasmariner.com

regentsevenseasnavigator.com

regentsevenseaspaulgauguin.com

regentsevenseasvoyager.com

regentsociety.mobi

regenttravelagent.com

regentvoyager.com

rssc.biz

rssc.co.uk

rssc.com

rssc.mobi

rssc.travel

rssc.us

rsscdiamond.com

rsscforms.com

rssc-incentives.com

rsscmail.com

rsscmariner.com

rsscnavigator.com

G-5

rsscpaulgauguin.com

rsscshipnet.com

rsscsongofflower.com

rsscvoyager.com

secretstobetterregentcruises.com

secrets-to-better-regent-cruises.com

secretstobuyingaregentcruise.com

secrets-to-buying-a-regent-cruise.com

secretstobuyingregentcruises.com

secrets-to-buying-regent-cruises.com

sellrssc.com

sevenseascruisesregentdiamondcruisesdiscounthanseaticcruises.com

sevenseasmarinercruisesregentnavigatorshipsongofflowercruises.com

sevenseasregent.biz

sevenseasregent.com

suitesonregentcruises.com

suites-on-regent-cruises.com

talkregentcruises.com

talk-regent-cruises.com

theregentcruiseplanner.com

topagentsforregentcruises.com

top-agents-for-regent-cruises.com

topsuitesonregentcruises.com

top-suites-on-regent-cruises.com

travelagentsforregentcruises.com

travel-agents-for-regent-cruises.com

virtuosoagentsforregentcruises.com

virtuoso-agents-for-regent-cruises.com

webeatregentcruisequotes.com

we-beat-regent-cruise-quotes.com

webeatregentcruisesquotes.com

we-beat-regent-cruises-quotes.com

webeatregentsevenseascruisequotes.com

we-beat-regent-seven-seas-cruise-quotes.com

webeatregentsevenseascruisesquotes.com

we-beat-regent-seven-seas-cruises-quotes.com

winyourregentcruise.com

win-your-regent-cruise.com

rssc-scotland.co.uk

rssc-sweden.com

G-6

EXHIBIT H

(Licensor Domain Names Used With Cruise and Hotel Businesses)

regentexperience.com

regentexperience.mobi

theregentexperience.com

theregentexperience.mobi

regentexperience.co.uk

EXHIBIT I

(RSSC Marks)


Mark	Reg. No./ Serial No.	Reg. Date/ App. Date	Class	Country of Registration
Regent Seven Seas Cruises	3,311,971 78/834,362	10/16/2007 03/10/2006	39, 43	UNITED STATES

	3,311,970 78/834,357	10/16/2007 03/10/2006	39, 43	UNITED STATES

RSSC

Regent Seven Seas Cruises	134692500	5/10/2007	39, 41, 43 Svl, Sv2	CANADA

	134693000	5/10/2007	39, 41, 43 Svl, Sv2	CANADA

Regent Seven Seas Cruises	5876131	5/4/2007	39, 41, 43	EUROPEAN COMMUNITY

	5876214	5/4/2007	39,41,43	EUROPEAN COMMUNITY

Exhibit 10.18

Date 18 July 2008

OCEANIA CRUISES INC.

as Guarantor

- and -

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

-and-

CALYON

SOCIÉTÉ GÉNÉRALÉ

as Mandated Lead Arrangers

-and-

CALYON

as Agent

GUARANTEE

relating to a Loan Agreement dated 18 July 2008 in respect of

the passenger cruise ship newbuilding presently designated as Hull No. 6194

Watson, Farley & Williams

Paris

INDEX


Clause	Page

1 INTERPRETATION		1
2 GUARANTEE		2
3 LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR		2
4 EXPENSES		3
5 ADJUSTMENT OF TRANSACTIONS		3
6 PAYMENTS		3
7 INTEREST		4
8 SUBORDINATION		4
9 ENFORCEMENT		4
10 REPRESENTATIONS AND WARRANTIES		5
11 UNDERTAKINGS		6
12 JUDGMENTS AND CURRENCY INDEMNITY		12
13 SET-OFF		12
14 SUPPLEMENTAL		12
15 ASSIGNMENT AND TRANSFER		13
16 NOTICES		13
17 INVALIDITY OF LOAN AGREEMENT
18 GOVERNING LAW AND JURISDICTION
EXECUTION PAGE		16
SCHEDULE 1 FORM OF COMPLIANCE CERTIFICATE
SCHEDULE 2 FINANCIAL COVENANT LEVELS		18

THIS GUARANTEE is made on 18 July 2008

BETWEEN

(1)

OCEANIA CRUISES INC ., a Panamanian sociedad anonima having its domicile in the Republic of Panama with its Resident Agent being Marcela Rojas de Perez with address at 10 Elvira Mendez Street, Top Floor, Panama, Republic of Panama represented by FRANK J. DEL RIO duly authorised for the purpose hereof (the “ Guarantor ”);

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1 of the Loan Agreement dated 18 July 2008 (the “Lenders”);

(3)

CALYON , a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9 quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre, and SOCIÉTÉ GÉNÉRALÉ , a French “société anonyme”, having a share capital of EUR 583,228,241.25 and its registered office located at 29 boulevard Haussmann, 75009 Paris, France, registered under the no. Siren 552 120 222 at the Registre du Commerce et des Sociétés of Paris (together the “ Mandated Lead Arrangers ”); and

(4)

CALYON , a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre (the “ Agent ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a Master Shipbuilding (Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri - Cantieri Navali Italiani SpA (the “ Builder ”), Prestige Cruise Holdings and, by way of endorsement, Marina New Build LLC (the “ Borrower ”) providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6194.

(B)

By a loan agreement dated 18 July 2008 and made between (i) the Borrower, (ii) the Lenders, (iii) the Mandated Lead Arrangers and (iv) the Agent and SACE Agent, it was agreed that the Lenders would make available to the Borrower a loan facility of the Dollar Equivalent of up to EUR 349,520,718 for the purpose of assisting the Borrower in financing (i) payment under the Shipbuilding Contract of all or part of 80% of the Final Contract Price up to the Eligible Amount and (ii) payment to SACE of the Dollar Equivalent of 100% of the second instalment of the SACE Premium.

(C)	The execution and delivery to the Agent of this Guarantee is one of the conditions precedent to the availability of the facility under the said Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1	Defined expressions. Words and expressions defined in the Loan Agreement shall 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;

“ Loan Agreement ” means the loan agreement dated 18 July 2008 referred to in Recital (A) and includes any existing or future amendments or supplements, whether made with the Guarantor’s consent or otherwise; and

“Oceania Cruises Group” means the Guarantor and its subsidiaries.

1.3	Application of construction and interpretation provisions of Loan Agreement . Clauses 1.2 to 1.5 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 Borrower under or in connection with the Loan Agreement and every other Finance Document;

(b)	undertakes to pay to the Agent acting on behalf of the Creditor Parties, on the Agent’s demand, any such amount which is not paid by the Borrower when payable;

(c)	undertakes to procure that the Borrower shall perform all its other obligations under the Loan Agreement and every other Finance Document; and

(d)

fully indemnifies the Agent and each other Creditor Party on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Agent as a result of or in connection with any obligation or liability guaranteed by the Guarantor unenforceable, invalid, void or illegal; and the amount recoverable under this indemnity shall be equal to the amount which the Agent or any Creditor Party would otherwise have been entitled to recover.

2.2	No limit on number of demands. The Agent acting on behalf of the Creditor Parties may serve any number of demands under Clause 2.1.

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, 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 any of them;

(b)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents or any of them;

(c)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents or any of them;

(d)	any failure whatsoever 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 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 Agent on its demand the amount of all expenses incurred by the Agent or any other Creditor Party in connection with any matter arising out of this Guarantee or any Security Interest connected with it, including any advice, claim or proceedings relating to this Guarantee or such a Security Interest.

4.2

Fees and expenses payable under Loan Agreement . Clause 4.1 is without prejudice to the Guarantor’s liabilities in respect of the Borrower’s obligations under clauses 10 (Fees) and 11 (Taxes, Increased Costs and Related Charges) of the Loan Agreement and under similar provisions of other Finance Documents.

5	ADJUSTMENT OF TRANSACTIONS

5.1

Reinstatement of obligation to pay . The Guarantor shall pay to the Agent 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 the Borrower or of any other Obligor (or similar person) on the ground that the Loan Agreement, or a payment by the Borrower or of such other Obligor, 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 Agent acting on behalf of the other Creditor Parties 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 Agent acting on behalf of the other Creditor Parties shall be increased by the amount necessary to ensure that the Agent and (if the payment is not due to the Agent 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

the amount due to the Guarantor hereunder and shall be accepted by the Guarantor in full and final settlement of its rights of reimbursement hereunder in respect of such deduction. Nothing herein contained shall interfere with the right of each Creditor Party to arrange its tax affairs in whatever manner it thinks fit.

7	INTEREST

7.1	Accrual of interest. Any amount due under this Guarantee shall carry interest after the date on which the Agent demands payment of it until it is actually paid, unless interest on that same amount also accrues under the Loan Agreement.

7.2	Calculation of interest. Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

7.3	Guarantee extends to interest payable under Loan Agreement. For the avoidance of doubt, it is confirmed that this Guarantee covers all interest payable under the Loan Agreement, including that payable under clause 17 of the Loan 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 the Borrower, any other Obligor or their respective assets shall be fully subordinated to the rights of the Creditor Parties under the Finance Documents; and in particular, the Guarantor shall not:

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, 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 the Borrower or any other Obligor; or

(d)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Creditor Party under a Finance Document.

9	ENFORCEMENT

9.1

No requirement to commence proceedings against Borrower. Neither the Agent nor any other Creditor Party will need to make any demand under, commence any proceedings under, or enforce any guarantee or any Security Interest contained in or created by, the Loan Agreement or any other Finance Document before claiming or commencing proceedings under this Guarantee.

9.2	Conclusive evidence of certain matters. However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement,

shall be binding and conclusive as to all matters of fact and law to which it relates.

9.3

Suspense account. The Agent and any Creditor Party may, for the purpose of claiming or proving in a bankruptcy of the Borrower or any other Obligor, 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 Borrower’s obligations under the Loan Agreement.

10	REPRESENTATIONS AND WARRANTIES

10.1

General. The Guarantor represents and warrants to each of the Creditor Parties as follows on the date of this Guarantee, which representations and warranties shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day from the date of this Guarantee to the end of the Security Period.

10.2	Status . The Guarantor is duly incorporated and validly existing and in good standing under the laws of Panama.

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 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; or

(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 Panama and the United States of America.

10.8	No default. To the knowledge of the Guarantor, no Event of Default has occurred and is continuing.

10.9

Information. All information which has been provided in writing by or on behalf of the Guarantor to the Agent or any other Creditor Party in connection with any Finance Document satisfied the requirements of Clause 11.2; all audited and unaudited accounts which have been so provided satisfied the requirements of Clause 11.4; 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 accounts.

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

No Security Interests. None of the assets or rights of the Guarantor is subject to any Security Interest except any Security Interest which qualifies as a Permitted Security Interest with respect to the Guarantor.

11	UNDERTAKINGS

11.1	General. The Guarantor undertakes with the Agent acting on behalf of the Creditor Parties to comply with the following provisions of this Clause 11 at all times from the date of this Deed to the end of the Security Period, except as the Agent may otherwise permit.

11.2	Information provided to be accurate. All financial and other information which is provided in writing by or on behalf of the Guarantor under or in connection with this Guarantee will be true and not misleading and will not omit any material fact or consideration.

11.3	Provision of financial statements. The Guarantor will send to the Agent:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2008, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)

as soon as practicable, but in no event later than 60 days after the end of each quarter in each financial year of the Guarantor beginning with the year ending 31 December 2008, unaudited consolidated accounts of the Guarantor and its subsidiaries certified as to their correctness by the chief financial officer of the Guarantor;

(c)	such projections (in such format as may be approved by the Agent) as may be required under the terms of the proviso to Clause 11.15 (b) for the purposes of applying the Financial Covenants set out in Clause 11.15 at the end of the First Financial Quarter (as defined in Clause 11.16);

(d)

(e)

a compliance certificate in the form set out in Schedule 1 to this Guarantee or in such other form as the Agent may reasonably require (each a “ Compliance Certificate ”) at the same time as there is delivered to the Agent, and together with, each set of audited consolidated accounts under paragraph (a) and the set of unaudited consolidated accounts under paragraph (b) which constitute those for the First Financial Quarter, duly signed by the chief financial officer of the Guarantor and certifying whether or not the requirements of Clause 11.15 are then complied with; and

(f)	such additional financial or other relevant information regarding the Guarantor and the Oceania Cruises Group as the Agent may reasonably request.

11.4	Form of financial statements. All accounts (audited and unaudited) delivered under Clause 11.3 will:

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Agent;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5	Shareholder and creditor notices. The Guarantor will send the Agent, at the same time as they are despatched, copies of all communications which are despatched to the Guarantor’s shareholders or creditors generally or any class of them.

11.6	Consents. The Guarantor will maintain in force and promptly obtain or renew, and will promptly send certified copies to the Agent of, all consents required:

(a)	for the Guarantor to perform its obligations under this Guarantee;

(b)	for the validity or enforceability of this Guarantee; and the Guarantor will comply with the terms of all such consents.

11.7

Notification of litigation. The Guarantor will provide the Agent with details of any material 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 (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding Ten million Dollars or the equivalent in another currency).

11.8	Domicile and principal place of business. The Guarantor:

(a)	will maintain its domicile, and keep its corporate documents and records, with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Agent;

(b)	will maintain its principal place of business in the United States of America at 8300 NW 33rd Street # 308, Miami FL33122, USA or at such other address in the United States of America as is notified beforehand to the Agent; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Agent, acting with the authorization of the Creditor Parties, such agreement not to be unreasonably withheld.

11.9	Notification of default. The Guarantor will notify the Agent as soon as the Guarantor becomes aware of the occurrence of an Event of Default and will thereafter keep the Agent 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 Panama.

11.11

Negative pledge . The Guarantor shall not, and shall procure that the Borrower will not create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Agent or otherwise permitted by the Finance Documents;

(b)	in the case of the Guarantor, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor;

(c)	in the case of the Borrower, Security Interests permitted under clause 13.5 of the Loan Agreement;

(d)

Security Interests provided in favour of lenders under and in connection with any refinancing of the Existing Indebtedness or any financing arrangements entered into by any member of the Oceania Cruises Group for the acquisition of additional or replacement ship(s) (including any refinancing of any such arrangement) but limited to:

(i)

pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)

ship mortgages and other securities over the financed ship(s),

it being agreed that any refinancing of Existing Indebtedness shall not be permitted if it results in the Letter of Credit ceasing to be in effect in accordance with its terms unless the prior consent of the Agent, acting with the authorisation of all the Creditor Parties, shall have been obtained.

11.12

No disposal of assets, change of business . The Guarantor will:

(a)

not and shall procure that its subsidiaries, as a group, shall not transfer all or substantially all of the cruise vessels owned by them and shall procure that any cruise vessels which are disposed of in compliance with the foregoing shall be disposed on a willing seller willing buyer basis at or about market rate and at arm’s length subject always to the provisions of any pertinent loan documentation, and

(b)

continue to be the member of a group of companies whose main business is the operation of cruise vessels as well as the marketing of cruises on board such vessels and the Guarantor will not change its main line of business so as to affect any Obligor’s ability to perform its obligations under the Finance Documents or to imperil, in the opinion of the Agent, the security created by any of the Finance Documents or the SACE Insurance Policy.

11.13

No merger etc . The Guarantor shall not, and shall procure that none of its subsidiaries will, enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity without the prior consent of the Creditor Parties, such consent not to be unreasonably withheld, provided that in any case and subject always to the provisions of Clauses 11.14 and 11.17, reorganisations (other than reorganisations directly involving the Borrower) of subsidiaries of the Guarantor and the creation of new subsidiaries of the Guarantor shall be permitted.

11.14

Maintenance of ownership of Borrower and Guarantor . Unless otherwise agreed, Prestige Holdings shall remain the legal holder and direct beneficial owner of the entire issued and allotted share capital of the Guarantor, free from any Security Interest and the Guarantor shall remain the legal holder and direct beneficial owner of all membership interest in the Borrower, free from any Security Interest, except that created in favour of the Agent acting on behalf of the other Creditor Parties.

11.15

Financial Covenants . The Guarantor shall ensure that for each relevant Financial Year and by reference to the accounts delivered under Clause 11.3:

(a)	at all times beginning at the end of the First Financial Quarter the minimum Free Liquidity will be not less than Thirty five million Dollars ($35,000,000);

(b)	at the end of the First Financial Quarter and thereafter at the end of each Financial Year (each a “ Relevant Date ”):

(i)

the ratio of EBITDA to Debt Service for the Oceania Cruises Group for the relevant Financial Year shall not be less than the level provided for, for that Financial Year, in Part A of Schedule 2 if the Letter of Credit shall have been issued and on the Relevant Date shall remain held by the Agent as security for the Creditor Parties or, if that Part A shall not apply, in Part B of Schedule 2;

(ii)

the ratio of Total Debt to EBITDA for the Oceania Cruises Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Part A of Schedule 2 if the Letter of Credit shall have been issued and on the Relevant Date shall remain held by the Agent as security for the Creditor Parties or, if that Part A shall not apply, in Part B of Schedule 2; and

(iii)

the ratio of Total Debt to Total Adjusted Equity for the Oceania Cruises Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Part A of Schedule 2 if the Letter of Credit shall have been issued and on the Relevant Date shall remain held by the Agent as security for the Creditor Parties or, if that Part A shall not apply, in Part B of Schedule 2;

provided that the “relevant Financial Year” shall mean, at the end of the First Financial Quarter, the Financial Year of which that First Financial Quarter forms part and, to the extent that there remain financial quarters still to come, in such Financial Year, the relevant numbers for calculation of the Financial Covenants at such time shall be made up of unaudited consolidated accounts for those quarters that have already taken place and of projected consolidated accounts for any quarter(s) still to come, such projections to be prepared by the Guarantor in such form and on such basis as may be reasonably acceptable to the Agent acting on behalf of the Creditor Parties, including being consistent with the approach adopted in the quarters that have taken place already.

11.16

Financial definitions. For the purposes of Clause 11.15:

(a)	“ Cash Balance ” means, at the date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Oceania Cruises Group;

(b)	“ Cash Brought Forward ” means, for any relevant period, the Cash Balance as at the start of that period less $35,000,000;

(c)	“ Debt Service ” means, for any relevant period, the sum (without double counting), determined in accordance with GAAP, of:

(i)

the aggregate principal payable or paid during such period on any Indebtedness of any member of the Oceania Cruises Group, other than:

(A)

principal of such Indebtedness prepaid at the option of the relevant member of the Oceania Cruises Group;

(B)

principal of any such Indebtedness prepaid upon the sale or Total Loss of any ship owned or leased under a capital lease by any member of the Oceania Cruises Group;

(C)

Excess Cash Flow based repayment;

and provided further that any balloon repayment of any such Indebtedness payable during such period shall be included only as to such part of such balloon repayment as is not refinanced for a period longer than 12 months and then only to the extent that the relevant amount exceeds the amount of Cash Brought Forward;

(ii)

Interest Expense for such period; and

(iii)

all rent under any capital lease obligations by which the Guarantor or any subsidiaries is bound which are payable or paid during such period and the portion of any debt discount that must be amortised in such period;

(d)	“ EBITDA ” means, for any relevant period, the aggregate of:

(i)

Net Income from the Oceania Cruises Group’s operations for such period; and

(ii)

the aggregate amounts deducted in determining Net Income for such period in respect of gains and losses from the sale of assets or reserves relating thereto, Interest Expense, depreciation and amortisation, income tax expenses for the period, impairment charges and any other non-cash charges and non-recurring charges for such period;

less

(iii)

gains from the sale of assets and any non-cash profits;

(e)

“ Excess Cash Flow based repayment ” means, for any period, repayment of principal made pursuant to (i) clause 2.11(c) of the credit agreement dated April 27, 2007 entered into among the Guarantor, certain of the subsidiaries of the Guarantor, the lenders party thereto, Lehman Commercial Paper Inc., as administrative agent, and certain other parties thereto (or any equivalent provision in any credit facility replacing or refinancing such credit agreement) and (ii) clause 2.11(c) of the second lien credit agreement dated April 27, 2007 entered into among the Guarantor, certain of the subsidiaries of the Guarantor, the lenders party thereto, Lehman Commercial Paper Inc., as administrative agent, and certain other parties thereto (or any equivalent provision in any credit facility replacing or refinancing such second lien credit agreement);

(f)

“ Free Liquidity ” means, at any date of determination, the aggregate of the Cash Balance and any amounts freely available for drawing under any revolving credit facilities of the Oceania Cruises Group, which remain undrawn, could be drawn for general working capital purposes or other general corporate purposes and would not, if drawn, be repayable within six (6) months;

(g)	“ Financial Year ” means any financial year of the Oceania Cruises Group ending on 31 December;

(h)	“ First Financial Quarter ” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

(i)	“ Indebtedness ” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:

(i)

moneys borrowed or raised;

(ii)

the advance or extension of credit (including interest and other charges on or in respect of the foregoing);

(iii)

the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;

(iv)

the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

(v)

all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and

(vi)

(without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;

PROVIDED THAT the following shall not constitute Indebtedness:

(aa)

loans and advances made by members of the Oceania Cruises Group to other members of the Oceania Cruises Group which are subordinated to the rights of the Creditor Parties; and

(bb)

any liabilities of the Guarantor or any other member of the Oceania Cruise Group to a counterparty under any master agreement relating to the interest or currency exchange of a non-speculative nature;

(j)	“ Interest Expense ” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Oceania Cruises Group for such period;

(k)	“ Net Income ” means, for any relevant period, the consolidated net income (or loss) of the Oceania Cruises Group for such period as determined in accordance with GAAP;

(l)	“ Total Debt ” means, as at any relevant date, Indebtedness of the Oceania Cruises Group;

(m)	“ Total Adjusted Equity ” means, at any date of determination, Total Equity at such date, as adjusted to exclude the direct or indirect impact of any hedging or similar arrangements on the consolidated stockholders’ equity of the Oceania Cruises Group as at such date as required under GAAP; and

(n)	“ Total Equity ” means, at any date of determination, the consolidated stockholders’ equity of the Oceania Cruises Group at such date determined in accordance with GAAP.

11.17

Negative Undertakings. The Guarantor shall:

(a)

not at any time after the end of the First Financial Quarter, declare or pay dividends or make other distributions or payment in respect of Financial Indebtedness owed to its shareholders without the prior written consent of the Agent, provided that the Guarantor may declare and pay dividends to its shareholders after the Delivery Date subject to it on each such occasion satisfying the Agent acting on behalf of the Creditor Parties that it will continue to meet all the requirements of Clause 11.15, if such covenants were to be tested immediately following the payment of any such dividend;

(b)	not, and shall procure that none of its subsidiaries shall

(i)

make loans to any person that is not a direct or indirect subsidiary of the Guarantor;

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not a direct or indirect subsidiary of the Guarantor

except if such loan is granted to a non subsidiary or such guarantee is issued in the ordinary course of business covering the obligations of a non subsidiary and the aggregate amount of all such loans and guarantees made or issued by the Guarantor and its subsidiaries does not exceed USD20,000,000 or is otherwise approved by the Agent which approval shall not be unreasonably withheld if such loan or guarantee in respect of a non subsidiary would neither:

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

affect the ability of the Guarantor to comply with the financial covenants contained in clause 11.15 if such covenants were to be tested immediately following the grant of such loan or the issuance of such guarantee, as demonstrated by evidence satisfactory to the Agent.

12	JUDGMENTS AND CURRENCY INDEMNITY

12.1	Judgments relating to Loan Agreement. This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 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 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

13.2

Existing rights unaffected. No Creditor Party shall be obliged to exercise any of its rights under Clause 13.1; 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, a sum payable by the Guarantor to the Agent acting on behalf of the Creditor Parties 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 Agent’s and any other Creditor Party’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 Agent or any other Creditor Party 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 Agent or any other Creditor Party 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 Agent or any other Creditor Party may now or later hold in connection with the Loan Agreement.

14.6

Guarantor bound by Loan Agreement . The Guarantor agrees with the Agent and any other Creditor Party to be bound by all provisions of the Loan Agreement which are applicable to the Security Parties in the same way 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 and 17 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 and 17.

14.8

Applicability of provisions of Guarantee to other rights . Clauses 3 and 17 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 and 17), being an agreement referring to this Guarantee.

14.9	Third party rights . Other than a Creditor Party or SACE, no person who is not a part y to this Guarantee has any right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Guarantee.

14.10

Waiver of rights against SACE . Nothing in this Guarantee or any of the Finance Documents is intended to grant to the Guarantor or any other person any right of contribution from or any other right or claim against SACE and the Guarantor hereby waives irrevocably any right of contribution or other right or claim as between itself and SACE.

15	ASSIGNMENT AND TRANSFER

15.1	Assignment and transfer by Creditor Parties . The Agent and Creditor Parties may assign or transfer their rights under and in connection with this Guarantee to the same extent as they may assign or transfer their 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:

8300 NW 33rd Street # 308, Miami FL33122, USA

Fax No: (00) 1 305 514 2297

or to such other address which the Guarantor may notify to the Agent.

(a)	to commence proceedings in relation to any matter which arises out of or in connection with this Guarantee 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 matter which arises out of or in connection with this Guarantee.

18.4

Process agent. The Guarantor irrevocably appoints EC3 Services Limited at its registered office for the time being, presently at 51 Eastcheap, London EC3M 1JP, 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 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, “ proceedings ” means proceedings of any kind, including an application for a provisional or protective measure.

THIS GUARANTEE has been entered into on the date stated at the beginning of this Guarantee.

EXECUTION PAGE


GUARANTOR
SIGNED by Frank J. Del Rio for and on behalf of OCEANIA CRUISES INC. as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )
LENDERS
SIGNED by Geoffrey D. Ferrer for and on behalf of SOCIÉTÉ GÉNÉRALE as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )
SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )
MANDATED LEAD ARRANGERS
SIGNED by Geoffrey D. Ferrer for and on behalf of SOCIÉTÉ GÉNÉRALE as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )
SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )
AGENT
SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )

SCHEDULE 2

FINANCIAL COVENANT LEVELS

PART A


Financial Year	EBITDA/ Debt Service	Total Debt/ EBITDA	Total Debt/ Total Adjusted Equity
2010	1.02x	15.00x	17.50x
2011	1.02x	10.00x	l5.50x
2012	1.02x	7.00x	8.75x
2013	1.10x	5.75x	6.00x
2014	1.10x	4.50x	3.25x
2015	1.20x	4.00x	2.50x
2016	1.25x	3.50x	2.50x
2017	1.30x	3.50x	2.50x
2018	1,30x	3.00x	2.50x
2019	1.30x	3.00x	2.50x
2020	1.30x	3.00x	2.50x
2021	1.30x	3.00x	2.50x
2022	1.30x	3.00x	2.50x
2023	1.30x	3.00x	2.50x

PART B


Financial Year	EBITDA/ Debt Service	Total Debt/ EBITDA	Total Debt/ Total Adjusted Equity
2010	1.10x	14.00x	17.50x
2011	1.10x	9.00x	15.50
2012	1.10x	6.50x	8.75x
2013	1.20x	5.50x	6.00x
2014	1.20x	4.50x	3.25x
2015	1.50x	4.00x	2.50x
2016	1.50x	3.50x	2.50x
2017	1.50x	3.50x	2.50x
2018	1.50x	3.00x	2.50x
2019	1.50x	3.00x	2.50x
2020	1.50x	3.00x	2.50x
2021	1.50x	3.00x	2.50x
2022	1.50x	3.00x	2.50x
2023	l.50x	3.00x	2.50x

Exhibit 10.19

Date 18 July 2008

PRESTIGE CRUISE HOLDINGS INC.

as Guarantor

- and -

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

-and-

CALYON

SOCIÉTÉ GÉNÉRALE

as Mandated Lead Arrangers

-and-

CALYON

as Agent

GUARANTEE

relating to a Loan Agreement dated 18 July 2008 in respect of

the passenger cruise ship newbulding presently designated as Hull No. 6194

Watson, Farley & Williams

Paris

INDEX


Clause	Page
1 INTERPRETATION		1
2 GUARANTEE		2
3 LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR		2
4 EXPENSES		3
5 ADJUSTMENT OF TRANSACTIONS		3
6 PAYMENTS		3
7 INTEREST		4
8 SUBORDINATION		4
9 ENFORCEMENT		4
10 REPRESENTATIONS AND WARRANTIES		5
11 UNDERTAKINGS		6
12 JUDGMENTS AND CURRENCY INDEMNITY		11
13 SET-OFF		11
14 SUPPLEMENTAL		12
15 ASSIGNMENT AND TRANSFER		13
16 NOTICES		13
17 INVALIDITY OF LOAN AGREEMENT		13
18 GOVERNING LAW AND JURISDICTION		14
EXECUTION PAGE		15
SCHEDULE 1 FORM OF COMPLIANCE CERTIFICATE		16
SCHEDULE 2 FINANCIAL COVENANT LEVELS		17

THIS GUARANTEE is made on 18 July 2008

BETWEEN

(1)

PRESTIGE CRUISE HOLDINGS INC., a Panamanian sociedad anonima having its domicile in the Republic of Panama with its Resident Agent being Arias, Fabrega & Fabrega with address at Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama represented by FRANK J. DEL RIO duly authorised for the purpose hereof (the “ Guarantor ”);

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1 of the Loan Agreement dated 18 July 2008 (the “ Lenders ”);

(3)

CALYON, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9 quai du Presidént Paul Doumer, 92920 Paris La Défense cedex, France, registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre, and SOCIÉTÉ GÉNÉRALE , a French “société anonyme”, having a share capital of EUR 583,228,241.25 and its registered office located at 29 boulevard Haussmann, 75009 Paris, France, registered under the no. Siren 522 120 222 at the Registre du Commerce et des Sociétés of Paris (together the “ Mandated Lead Arrangers ”); and

(4)

CALYON, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, Quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre (the “ Agent ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a Master Shipbuilding (Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri—Cantieri Navali Italiani SpA (the “ Builder ”), the Guarantor, Oceania Cruises Inc. and, by way of endorsement, Marina New Build LLC (the “ Borrower ”) providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6194

(B)

(C)	The execution and delivery to the Agent of this Guarantee is one of the conditions precedent to the availability of the facility under the said Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Defined expressions. Words and expressions defined in the Loan Agreement shall have the same meanings when used in this Guarantee unless the context otherwise requires.

1.2

Construction of certain terms . In this Guarantee:

“ Apollo ” means the Fund and any Fund Affiliate;

“ Fund ” means Apollo Management VI, L.P. and other co-investment partnerships managed by Apollo Management VI, L.P.;

“ Fund Affiliate ” means (i) each Affiliate of the Fund that is neither a “portfolio company” (which means a company actively engaged in providing goods or services to unaffiliated customers), whether or not controlled, nor a company controlled by a “portfolio company” and (ii) any individual who is a partner or employee of Apollo Management, L.P., Apollo Management VI, L.P. or Apollo Management V, L.P.;

“ Management ” means the employees of the Guarantor and its subsidiaries or their dependants or any trust for which such persons are the intended beneficiary.

1.3

Application of construction and interpretation provisions of Loan Agreement. Clauses 1.2 to 1.5 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 Borrower under or in connection with the Loan Agreement and every other Finance Document;

(b)	undertakes to pay to the Agent acting on behalf of the Creditor Parties, on the Agent’s demand, any such amount which is not paid by the Borrower when payable;

(c)	undertakes to procure that the Borrower shall perform all its other obligations under the Loan Agreement and every other Finance Document; and

(d)

fully indemnifies the Agent and each other Creditor Party on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Agent 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 Agent or any Creditor Party would otherwise have been entitled to recover.

2.2

No limit on number of demands. The Agent acting on behalf of the Creditor Parties may serve any number of demands under Clause 2.1.

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, 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 any of them;

(b)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents or any of them;

(c)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents or any of them;

(d)	any failure whatsoever 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 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 Agent on its demand the amount of all expenses incurred by the Agent or any other Creditor Party in connection with any matter arising out of this Guarantee or any Security Interest connected with it, including any advice, claim or proceedings relating to this Guarantee or such a Security Interest.

4.2

Fees and expenses payable under Loan Agreement. Clause 4.1 is without prejudice to the Guarantor’s liabilities in respect of the Borrower’s obligations under clauses 10 (Fees) and 11 (Taxes, Increased Costs and Related Charges) of the Loan Agreement and under similar provisions of other Finance Documents.

5	ADJUSTMENT OF TRANSACTIONS

5.1

Reinstatement of obligation to pay. The Guarantor shall pay to the Agent 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 the Borrower or of any other Obligor (or similar person) on the ground that the Loan Agreement, or a payment by the Borrower or of such other Obligor, 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 Agent acting on behalf of the other Creditor Parties 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

6.3

Tax Credits. If an additional payment is made by the Guarantor under this Clause and any Creditor Party determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction giving rise to such additional payment, such Creditor Party shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Guarantor such amount as such Creditor Party shall in its reasonable opinion have concluded to be attributable to the relevant deduction. Any such payment shall be conclusive evidence of the amount due to the Guarantor hereunder and shall be accepted by the Guarantor in full and final settlement of its rights of reimbursement hereunder in respect of such deduction. Nothing herein contained shall interfere with the right of each Creditor Party to arrange its tax affairs in whatever manner it thinks fit.

7	INTEREST

7.1

Accrual of interest. Any amount due under this Guarantee shall carry interest after the date on which the Agent demands payment of it until it is actually paid, unless interest on that same amount also accrues under the Loan Agreement.

7.2

Calculation of interest. Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

7.3

Guarantee extends to interest payable under Loan Agreement . For the avoidance of doubt, it is confirmed that this Guarantee covers all interest payable under the Loan Agreement, including that payable under clause 17 of the Loan Agreement.

8	SUBORDINATION

8.1

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, 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 the Borrower or any other Obligor; or

(d)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Creditor Party under a Finance Document.

9	ENFORCEMENT

9.1

9.2

Conclusive evidence of certain matters. However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement, shall be binding and conclusive as to all matters of fact and law to which it relates,

9.3

10	REPRESENTATIONS AND WARRANTIES

10.1

10.2

Status. The Guarantor is duly incorporated and validly existing and in good standing under the laws of Panama.

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 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; or

(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 Panama and the United States of America.

10.8

No default. To the knowledge of the Guarantor, no Event of Default has occurred and is continuing.

10.9

Information . All information which has been provided in writing by or on behalf of the Guarantor to the Agent or any other Creditor Party in connection with any Finance Document satisfied the requirements of Clause 11.2; all audited and unaudited accounts which have been so provided satisfied the requirements of Clause 11.4; 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 accounts.

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

No Security Interests . None of the assets or rights of the Guarantor is subject to any Security Interest except any Security Interest which qualifies as a Permitted Security Interest with respect to the Guarantor.

11	UNDERTAKINGS

11.1

General . The Guarantor undertakes with the Agent acting on behalf of the Creditor Parties to comply with the following provisions of this Clause 11 at all times from the date of this Deed to the end of the Security Period, except as the Agent may otherwise permit.

11.2

Information provided to be accurate . All financial and other information which is provided in writing by or on behalf of the Guarantor under or in connection with this Guarantee will be true and not misleading and will not omit any material fact or consideration.

11.3

Provision of financial statements . The Guarantor will send to the Agent:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2008, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)

(c)	such projections (in such format as may be approved by the Agent) as may be required under the terms of the proviso to Clause 11.15 (b) for the purposes of applying the Financial Covenants set out in Clause 11.15 at the end of the First Financial Quarter (as defined in Clause 11.16);

(d)

(e)

a compliance certificate in the form set out in Schedule 1 to this Guarantee or in such other form as the Agent may reasonably require (each a “Compliance Certificate”) at the same time as there is delivered to the Agent, and together with, each set of audited consolidated accounts under paragraph (a) and the set of unaudited consolidated accounts under paragraph (b) which constitute those for the First Financial Quarter, duly signed by the chief financial officer of the Guarantor and certifying whether or not the requirements of Clause 11.15 are then complied with; and

(f)	such additional financial or other relevant information regarding the Guarantor and the Group as the Agent may reasonably request.

11.4

Form of financial statements . All accounts (audited and unaudited) delivered under Clause 11.3 will:

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Agent;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5

Shareholder and creditor notices . The Guarantor will send the Agent, at the same time as they are despatched, copies of all communications which are despatched to the Guarantor’s shareholders or creditors generally or any class of them.

11.6

Consents . The Guarantor will maintain in force and promptly obtain or renew, and will promptly send certified copies to the Agent of, all consents required:

(a)	for the Guarantor to perform its obligations under this Guarantee;

(b)	for the validity or enforceability of this Guarantee;

and the Guarantor will comply with the terms of all such consents.

11.7

Notification of litigation . The Guarantor will provide the Agent with details of any material 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 (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding Ten million Dollars or the equivalent in another currency).

11.8

Domicile and principal place of business . The Guarantor:

(a)	will maintain its domicile, and keep its corporate documents and records, with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Agent;

(b)	will maintain its principal place of business in the United States of America at 8300 NW 33rd Street # 308, Miami FL33122, USA or at such other address in the United States of America as is notified beforehand to the Agent; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Agent, acting with the authorization of the Creditor Parties, such agreement not to be unreasonably withheld.

11.9

Notification of default . The Guarantor will notify the Agent as soon as the Guarantor becomes aware of the occurrence of an Event of Default and will thereafter keep the Agent 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 Panama.

11.11

Negative pledge . The Guarantor shall not, and shall procure that neither Oceania Cruises nor the Borrower will, create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Agent or otherwise permitted by the Finance Documents;

(b)	in the case of the Guarantor and Oceania Cruises, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor or Oceania Cruises respectively;

(c)	in the case of the Borrower, Security Interests permitted under clause 13.5 of the Loan Agreement;

(d)

Security Interests provided in favour of lenders under and in connection with any refinancing of the Existing Indebtedness or any financing arrangements entered into by any member of the Group for the acquisition of additional or replacement ship(s) (including any refinancing of any such arrangement) but limited to:

(i)

pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)

ship mortgages and other securities over the financed ship(s),

11.12

No disposal of assets, change of business . The Guarantor will:

(a)

(b)

continue to be a holding company for a group of companies whose main business is the operation of cruise vessels as well as the marketing of cruises on board such vessels and the Guarantor will not change its main line of business so as to affect any Obligor’s ability to perform its obligations under the Finance Documents or to imperil, in the opinion of the Agent, the security created by any of the Finance Documents or the SACE Insurance Policy.

11.13

No merger etc . The Guarantor shall not enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity (each of the foregoing being a “ Transaction ”) unless:

(a)

the Guarantor has notified the Agent in writing of the agreed terms of the relevant Transaction promptly after such terms have been agreed as heads of terms (or similar) and thereafter notified the Agent in writing of any significant amendments to such terms during the course of the negotiation of the relevant Transaction; and

(b)	the relevant Transaction does not require or involve or result in any dissolution of the Guarantor so that at all times the Guarantor remains in existence; and

(c)	each notice delivered to the Agent pursuant to paragraph (a) above is accompanied by a certificate signed by the Chief Financial Officer of the Guarantor whereby the Guarantor represents and warrants to the Agent that the relevant Transaction will not:

(i)

adversely affect the ability of any Obligor to perform its obligations under the Finance Documents;

(ii)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; or

(iii)

affect the ability of the Guarantor to comply with the financial covenants contained in Clause 11.15.

11.14 Maintenance of ownership of Borrower and Guarantor.

(a)

The Guarantor shall remain the legal holder and direct beneficial owner of the entire issued and allotted share capital of Oceania Cruises, free from any Security Interest and Oceania Cruises shall remain the legal holder and direct beneficial owner of all membership interest in the Borrower, free from any Security Interest, except that created in favour of the Agent acting on behalf of the other Creditor Parties;

(b)

prior to any underwritten public offering of the equity interests of the Guarantor (or any direct or indirect parent of the Guarantor) which generates cash proceeds to Oceania Cruises of at least $ 150 million (a “ Qualified IPO ”), a combination of Apollo and Management (the “ Permitted Holders ”) shall at all times own beneficially (within the meaning of Rules 13d-3 and 13d-5 of The Securities Exchange Act of 1934 (15 USC §78a et seq.) (the “ Exchange Act ”) as in effect on the Delivery Date) directly or indirectly, in the aggregate, equity interests representing at least a majority of the aggregate ordinary voting power represented by the issued and outstanding equity interests of the Guarantor; or.

(c)

after a Qualified IPO, no person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Delivery Date) shall acquire beneficial ownership of 35% or more on a fully diluted basis of the voting interest in the Guarantor’s equity interests unless the Permitted Holders shall own directly or indirectly, more than such person or “group” on a fully diluted basis of the voting interest in the Guarantor’s equity interests.

11.15

Financial Covenants . The Guarantor shall ensure that for each relevant Financial Year and by reference to the accounts delivered under Clause 11.3 at the end of the First Financial Quarter and thereafter at the end of each Financial Year:

(a)	the ratio of Total Debt to EBITDA for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2; and

(b)	the ratio of Total Debt to Total Adjusted Equity for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2;

11.16

Financial definitions . For the purposes of Clause 11.15:

(a)	“EBITDA” means, for any relevant period, the aggregate of:

(i)

Net Income from the Group’s operations for such period; and

(ii)

less

(iii)

gains from the sale of assets and any non-cash profits;

(b)	“ Financial Year ” means any financial year of the Group ending on 31 December;

(c)	“ First Financial Quarter ” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

(d)	“ Indebtedness ” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:

(i)

moneys borrowed or raised;

(ii)

the advance or extension of credit (including interest and other charges on or in respect of the foregoing);

(iii)

the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;

(iv)

the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

(v)

all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and

(vi)

(without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;

PROVIDED THAT the following shall not constitute Indebtedness:

(aa)

loans and advances made by members of the Group to other members of the Group which are subordinated to the rights of the Creditor Parties; and

(bb)

any liabilities of the Guarantor or any other member of the Group to a counterparty under any master agreement relating to the interest or currency exchange of a non-speculative nature;

(e)	“ Interest Expense ” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Group for such period;

(f)	“ Net Income ” means, for any relevant period, the consolidated net income (or loss) of the Group for such period as determined in accordance with GAAP;

(g)	“Total Debt” means, as at any relevant date, Indebtedness of the Group;

(h)	“Total Adjusted Equity” means, at any date of determination, Total Equity at such date, as adjusted to exclude the direct or indirect impact of any hedging or similar arrangements on the consolidated stockholders’ equity of the Group as at such date as required under GAAP; and

(i)	“Total Equity” means, at any date of determination, the consolidated stockholders’ equity of the Group at such date determined in accordance with GAAP.

11.17

Negative Undertakings . The Guarantor shall:

(a)

(b)	not, and shall procure that none of its subsidiaries shall:

(i)

make loans to any person that is not a direct or indirect subsidiary of the Guarantor: or

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not a direct or indirect subsidiary of the Guarantor

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

12	JUDGMENTS AND CURRENCY INDEMNITY

12.1

Judgments relating to Loan Agreement. This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 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 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

13.2

13.3

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 Agent’s and any other Creditor Party’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 Agent or any other Creditor Party 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 Agent or any other Creditor Party 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 Agent or any other Creditor Party may now or later hold in connection with the Loan Agreement.

14.6

Guarantor bound by Loan Agreement. The Guarantor agrees with the Agent and any other Creditor Party to be bound by all provisions of the Loan Agreement which are applicable to the Security Parties in the same way as if those provisions had been set out (with any necessary modifications) in this Guarantee.

14.7

14.8

Applicability of provisions of Guarantee to other rights. Clauses 3 and 17 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 and 17), being an agreement referring to this Guarantee.

14.9

Third party rights. Other than a Creditor Party or SACE, no person who is not a party to this Guarantee has any right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Guarantee.

14.10

Waiver of rights against SACE. Nothing in this Guarantee or any of the Finance Documents is intended to grant to the Guarantor or any other person any right of contribution from or any other right or claim against SACE and the Guarantor hereby waives irrevocably any right of contribution or other right or claim as between itself and SACE.

15	ASSIGNMENT AND TRANSFER

15.1

Assignment and transfer by Creditor Parties. The Agent and Creditor Parties may assign or transfer their rights under and in connection with this Guarantee to the same extent as they may assign or transfer their 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:

8300 NW 33rd Street # 308, Miami FL33122, USA

Fax No: (00) 1 305 514 2297

or to such other address which the Guarantor may notify to the Agent.

16.2

Application of certain provisions of Loan Agreement. Clauses 32.3 to 32.8 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 Borrower under the Loan Agreement;

(b)	at the same time as the service of a notice under clause 18.22 (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 without specifying a particular sum or aggregate sum.

16.4

Notices to Agent. Any notice to the Agent acting on behalf of the Creditor Parties under or in connection with this Guarantee shall be sent to the same address and in the same manner as notices to the Agent under the Loan Agreement.

17	INVALIDITY OF LOAN AGREEMENT

17.1

Invalidity of Loan Agreement. In the event of:

(a)	the Loan Agreement or any provision thereof now being or later becoming; with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any reason whatsoever; or

(b)	without limiting the scope of paragraph (a), a bankruptcy of the Borrower, the introduction of any law or any other matter resulting in the 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 Borrower had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrower 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 Borrower 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 Finance Documents. Clause 17.1 also applies to each of the other Finance Documents to which the Borrower is a party.

18	GOVERNING LAW AND JURISDICTION

18.1

English law. This Guarantee shall be governed by, and construed in accordance with, English law.

18.2

Exclusive English jurisdiction. Subject to Clause 18.3, the courts of England shall have exclusive jurisdiction to settle any disputes which may arise out of or in connection with this Guarantee.

18.3

Choice of forum for the exclusive benefit of the Creditor Parties. Clause 18.2 is for the exclusive benefit of the Agent and other Creditor Parties, which reserve the rights:

(a)	to commence proceedings in relation to any matter which arises out of or in connection with this Guarantee 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 matter which out of or in connection with this Guarantee.

18.4

Process agent. The Guarantor irrevocably appoints EC3 Services Limited at its registered office for the time being, presently at 51 Eastcheap, London EC3M IJP, 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 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, “ proceedings ” means proceedings of any kind, including an application for a provisional or protective measure.

EXECUTION PAGE


GUARANTOR Frank J. Del Rio SIGNED by for and on behalf of PRESTIGE CRUISE HOLDINGS INC. as its duly appointed attorney-in-fact in the presence of:		) ) ) ) ) )

LENDER Geoffrey D. Ferrer SIGNED by for and on behalf of SOCIÉTÉ GÉNÉRAL as its duly appointed attorney-in-fact in the presence of: SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attomey-in-fact . in the presence of:		) ) ) ) ) ) ) ) ) )

MANDATED LEAD ARRANGERS

SIGNED by Geoffrey D. Ferrer for and on behalf of SOCIÉTÉ GÉNÉRALE as its duly appointed attomey-in-fact in the presence of:		) ) ) ) )

SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attomey-in-fact in the presence of:		) ) ) ) )

AGENT SIGNED by Geoffrey D. Ferrer for and on behalf of CALYON as its duly appointed attorney-in-fact in the presence of:		) ) ) ) )

SCHEDULE 1

FORM OF COMPLIANCE CERTIFICATE

To:

CALYON

9 Quai du Président Paul Doumer

92920 Paris La Défense cedex

France

Attn: [•]

[•] 200[•]

Dear Sirs

Loan Agreement dated [•] July 2008 (the “Loan Agreement”) made between (1) Marina New Build, LLC (the “Borrower”), (2) the banks and financial institutions named at schedule 1 therein as lenders, (3) Calyon and Société Générale as Mandated Lead Arrangers and (4) Calyon as Agent and SACE Agent for a loan facility of up to the aggregate of the Dollar Equivalent of EUR 334,590,328.80 and the second instalment of the SACE Premium and Guarantee dated [•] July 2008 (the “Guarantee”) made between (1) us as guarantor and (2) Calyon as Agent

We refer to the Loan Agreement and the Guarantee. Terms defined in the Loan Agreement and the Guarantee have their defined meanings when used in this Compliance Certificate.

We also refer to the financial covenants set out in Clause 11.15 of the Guarantee.

We certify that, as at the date of this Compliance Certificate, in relation to such covenants and by reference to the latest accounts provided under Clause 11.3[ (a)/(b) ] of the Guarantee:

(a)	the ratio of Total Debt to EBITDA is [•] and therefore [does/does not] exceed [insert relevant maximum] ;

(b)	the ratio of Total Debt to Total Adjusted Equity is [•] and therefore [does/does not] exceed [insert relevant maximum],

To evidence compliance with the terms of Clause 11.15, we attach:

[ a copy of the latest annual consolidated accounts of the Group as Appendix A;] or

[copies of the existing quarterly unaudited consolidated accounts of the Group for the current Financial Year together with projections for the quarter(s) still to come in the current Financial Year— applies to First Financial Quarter only. ]

No Event of Default has occurred in relation to the Borrower or the Guarantor.

Signed:

Chief Financial Officer of

Prestige Cruise Holdings Inc.

SCHEDULE 2

FINANCIAL COVENANT LEVELS


Financial Year	Total Debt/		Total Debt/
	EBITDA		Total Adjusted Equity
2010		13.00x		11.00x
2011		9.50x		8.50x
2012		6.50x		4.50x
2013		5.75x		3.00x
2014		4.50x		2.50x
2015		4.00x		2.50x
2016		3.50x		2.50x
2017		3.50x		2.50x
2018		3.00x		2.50x
2019		3.00x		2.50x
2020		3.00x		2.50x
2021		3.00x		2.50x
2022		3.00x		2.50x
2023		3.00x		2.50x

Exhibit 10.20

Date 18 July 2008

OCEANIA CRUISES INC.

as Guarantor

- and -

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

-and-

CALYON

SOCIÉTÉ GÉNÉRALE

as Mandated Lead Arrangers

-and-

CALYON

as Agent

GUARANTEE

relating to a Loan Agreement dated 18 July 2008 in respect of

the passenger cruise ship newbulding presently designated as Hull No. 6195

Watson, Farley & Williams

Paris

INDEX


Clause		Page
1	INTERPRETATION		1
2	GUARANTEE		2
3	LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR		2
4	EXPENSES		3
5	ADJUSTMENT OF TRANSACTIONS		3
6	PAYMENTS		3
7	INTEREST		4
8	SUBORDINATION		4
9	ENFORCEMENT		4
10	REPRESENTATIONS AND WARRANTIES		5
11	UNDERTAKINGS		6
12	JUDGMENTS AND CURRENCY INDEMNITY		12
13	SET-OFF		12
14	SUPPLEMENTAL		12
15	ASSIGNMENT AND TRANSFER		13
16	NOTICES		13
17	INVALIDITY OF LOAN AGREEMENT		14
18	GOVERNING LAW AND JURISDICTION		14
EXECUTION PAGE			16
SCHEDULE 1 FORM OF COMPLIANCE CERTIFICATE			17
SCHEDULE 2 FINANCIAL COVENANT LEVELS			18

THIS GUARANTEE is made on 18 July 2008

BETWEEN

(1)

OCEANIA CRUISES INC. , a Panamanian sociedad anonima having its domicile in the Republic of Panama with its Resident Agent being Marcela Rojas de Perez with address at 10 Elvira Mendez Street, Top Floor, Panama, Republic of Panama represented by FRANK J. DELRIO duly authorised for the purpose hereof (the “Guarantor” );

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1 of the Loan Agreement dated 18 July 2008 (the “Lenders” );

(3)

CALYON , a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9 quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre, and SOCIÉTÉ GÉNÉRALE , a French “société anonyme ”, having a share capital of EUR 583,228,241.25 and its registered office located at 29 boulevard Haussmann, 75009 Paris, France, registered under the no. Siren 552 120 222 at the Registre du Commerce et des Sociétés of Paris (together the “ Mandated Lead Arrangers ”); and

(4)

CALYON , a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the nº Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre (the “ Agent ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a Master Shipbuilding (Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri - Cantieri Navali Italiani SpA (the “ Builder ”), Prestige Cruise Holdings Inc., the Guarantor and, by way of endorsement, Riviera New Build LLC (the “ Borrower ”) providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6195.

(B)

(C)	The execution and delivery to the Agent of this Guarantee is one of the conditions precedent to the availability of the facility under the said Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Defined expressions. Words and expressions defined in the Loan Agreement shall 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;

“ Oceania Cruises Group ” means the Guarantor and its subsidiaries.

1.3

Application of construction and interpretation provisions of Loan Agreement. Clauses 1.2 to 1.5 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 Borrower under or in connection with the Loan Agreement and every other Finance Document;

(b)	undertakes to pay to the Agent acting on behalf of the Creditor Parties, on the Agent’s demand, any such amount which is not paid by the Borrower when payable;

(c)	undertakes to procure that the Borrower shall perform all its other obligations under the Loan Agreement and every other Finance Document; and

(d)

fully indemnifies the Agent and each other Creditor Party on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Agent 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 Agent or any Creditor Party would otherwise have been entitled to recover.

2.2

No limit on number of demands. The Agent acting on behalf of the Creditor Parties may serve any number of demands under Clause 2.1.

3	LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR

3.1

3.2

Waiver of rights and defences. Without limiting the generality of Clause 3.1, 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 any of them;

(b)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents or any of them;

(c)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents or any of them;

(d)	any failure whatsoever 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 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

4.2

5	ADJUSTMENT OF TRANSACTIONS

5.1

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 Agent acting on behalf of the other Creditor Parties 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

6.3

7	INTEREST

7.1

7.2

Calculation of interest. Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

7.3

Guarantee extends to interest payable under Loan Agreement. For the avoidance of doubt, it is confirmed that this Guarantee covers all interest payable under the Loan Agreement, including that payable under clause 17 of the Loan Agreement.

8	SUBORDINATION

8.1

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, 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 the Borrower or any other Obligor; or

(d)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Creditor Party under a Finance Document.

9	ENFORCEMENT

9.1

9.2

Conclusive evidence of certain matters. However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement, shall be binding and conclusive as to all matters of fact and law to which it relates.

9.3

10	REPRESENTATIONS AND WARRANTIES

10.1

10.2

Status. The Guarantor is duly incorporated and validly existing and in good standing under the laws of Panama.

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 remain in force and nothing has occurred which makes any of them liable to revocation.

10.5

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; or

(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

10.8

No default. To the knowledge of the Guarantor, no Event of Default has occurred and is continuing.

10.9

10.10

10.11

11	UNDERTAKINGS

11.1

General. The Guarantor undertakes with the Agent acting on behalf of the Creditor Parties to comply with the following provisions of this Clause 11 at all times from the date of this Deed to the end of the Security Period, except as the Agent may otherwise permit.

11.2

Information provided to be accurate. All financial and other information which is provided in writing by or on behalf of the Guarantor under or in connection with this Guarantee will be true and not misleading and will not omit any material fact or consideration.

11.3

Provision of financial statements. The Guarantor will send to the Agent:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2008, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)

(c)	such projections (in such format as may be approved by the Agent) as may be required under the terms of the proviso to Clause 11.15 (b) for the purposes of applying the Financial Covenants set out in Clause 11.15 at the end of the First Financial Quarter (as defined in Clause 11.16);

(d)

(e)

(f)	such additional financial or other relevant information regarding the Guarantor and the Oceania Cruises Group as the Agent may reasonably request.

11.4

Form of financial statements. All accounts (audited and unaudited) delivered under Clause 11.3 will:

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Agent;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5

Shareholder and creditor notices. The Guarantor will send the Agent, at the same time as they are despatched, copies of all communications which are despatched to the Guarantor’s shareholders or creditors generally or any class of them.

11.6

Consents. The Guarantor will maintain in force and promptly obtain or renew,

and will promptly send certified copies to the Agent of, all consents required:

(a)	for the Guarantor to perform its obligations under this Guarantee;

(b)	for the validity or enforceability of this Guarantee; and the Guarantor will comply with the terms of all such consents.

11.7

11.8

Domicile and principal place of business. The Guarantor:

(a)	will maintain its domicile, and keep its corporate documents and records, with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Agent;

(b)	will maintain its principal place of business in the United States of America at 8300 NW 33rd Street # 308, Miami FL33122, USA or at such other address in the United States of America as is notified beforehand to the Agent; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Agent, acting with the authorization of the Creditor Parties, such agreement not to be unreasonably withheld.

11.9

Notification of default. The Guarantor will notify the Agent as soon as the Guarantor becomes aware of the occurrence of an Event of Default and will thereafter keep the Agent 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 Panama.

11.11

Negative pledge. The Guarantor shall not, and shall procure that the Borrower will not create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Agent or otherwise permitted by the Finance Documents;

(b)	in the case of the Guarantor, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor;

(c)	in the case of the Borrower, Security Interests permitted under clause 13.5 of the Loan Agreement;

(d)

(i)

pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)

ship mortgages and other securities over the financed ship(s),

11.12

No disposal of assets, change of business. The Guarantor will:

(a)

(b)

11.13

No merger etc. The Guarantor shall not, and shall procure that none of its subsidiaries will, enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity without the prior consent of the Creditor Parties, such consent not to be unreasonably withheld, provided that in any case and subject always to the provisions of Clauses 11.14 and 11.17, reorganisations (other than reorganisations directly involving the Borrower) of subsidiaries of the Guarantor and the creation of new subsidiaries of the Guarantor shall be permitted.

11.14

Maintenance of ownership of Borrower and Guarantor. Unless otherwise agreed, Prestige Holdings shall remain the legal holder and direct beneficial owner of the entire issued and allotted share capital of the Guarantor, free from any Security Interest and the Guarantor shall remain the legal holder and direct beneficial owner of all membership interest in the Borrower, free from any Security Interest, except that created in favour of the Agent acting on behalf of the other Creditor Parties.

11.15

Financial Covenants. The Guarantor shall ensure that for each relevant Financial Year and by reference to the accounts delivered under Clause 11.3:

(a)	at all times beginning at the end of the First Financial Quarter the minimum Free Liquidity will be not less than Thirty five million Dollars ($35,000,000);

(b)	at the end of the First Financial Quarter and thereafter at the end of each Financial Year (each a “ Relevant Date ”):

(i)

(ii)

(iii)

provided that the “relevant Financial Year” shall mean, at the end of the First Financial Quarter, the Financial Year of which that First Financial Quarter forms part and, to the extent that there remain financial quarters still to come, in such Financial Year, the relevant numbers for calculation of the Financial Covenants at such time shall be made up of unaudited consolidated accounts for those quarters that have already taken place and of projected consolidated accounts for any quarter(s) still to come, such projections to be prepared by the Guarantor in such form and on such basis as may be reasonably acceptable to the Agent acting on behalf of the Creditor Parties, including being consistent with the approach adopted in the quarters that have taken place already.

11.16

Financial definitions. For the purposes of Clause 11.15:

(a)	“ Cash Balance ” means, at the date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Oceania Cruises Group;

(b)	“ Cash Brought Forward ” means, for any relevant period, the Cash Balance as at the start of that period less $35,000,000;

(c)	“ Debt Service ” means, for any relevant period, the sum (without double counting), determined in accordance with GAAP, of:

(i)

the aggregate principal payable or paid during such period on any Indebtedness of any member of the Oceania Cruises Group, other than:

(A)

principal of such Indebtedness prepaid at the option of the relevant member of the Oceania Cruises Group;

(B)

principal of any such Indebtedness prepaid upon the sale or Total Loss of any ship owned or leased under a capital lease by any member of the Oceania Cruises Group;

(C)

Excess Cash Flow based repayment;

(ii)

Interest Expense for such period; and

(iii)

(d)	“ EBITDA ” means., for any relevant period, the aggregate of:

(i)

Net Income from the Oceania Cruises Group’s operations for such period; and

(ii)

less

(iii)

gains from the sale of assets and any non-cash profits;

(e)

“ Excess Cash Flow based repayment ” means, for any period, repayment of principal made pursuant to (i) clause 2.11(c) of the credit agreement dated April 27, 2007 entered into among the Guarantor, certain of the subsidiaries of the Guarantor, the lenders party thereto, Lehman Commercial Paper Inc., as administrative agent, and certain other parties thereto (or any equivalent provision in any credit facility replacing or refinancing such credit agreement) and (ii) clause 2 .11 (c) of the second lien credit agreement dated April 27, 2007 entered into among the Guarantor, certain of the subsidiaries of the Guarantor, the lenders party thereto, Lehman Commercial Paper Inc., as administrative agent, and certain other parties thereto (or any equivalent provision in any credit facility replacing or refinancing such second lien credit agreement);

(f)

(g)	“ Financial Year ” means any financial year of the Oceania Cruises Group ending on 31 December;

(h)	“ First Financial Quarter ” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

(i)	“ Indebtedness ” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:

(i)

moneys borrowed or raised;

(ii)

the advance or extension of credit (including interest and other charges on or in respect of the foregoing);

(iii)

the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;

(iv)

the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

(v)

all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and

(vi)

(without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;

PROVIDED THAT the following shall not constitute Indebtedness:

(aa)

loans and advances made by members of the Oceania Cruises Group to other members of the Oceania Cruises Group which are subordinated to the rights of the Creditor Parties; and

(bb)

any liabilities of the Guarantor or any other member of the Oceania Cruises Group to a counterparty under any master agreement relating to the interest or currency exchange of a non-speculative nature;

(j)	“ Interest Expense ” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Oceania Cruises Group for such period;

(k)	“ Net Income ” means, for any relevant period, the consolidated net income (or loss) of the Oceania Cruises Group for such period as determined in accordance with GAAP;

(l)	“ Total Debt ” means, as at any relevant date, Indebtedness of the Oceania Cruises Group;

(m)	“ Total Adjusted Equity ” means, at any date of determination, Total Equity at such date, as adjusted to exclude the direct or indirect impact of any hedging or similar arrangements on the consolidated stockholders’ equity of the Oceania Cruises Group as at such date as required under GAAP; and

(n)	“ Total Equity ” means, at any date of determination, the consolidated stockholders’ equity of the Oceania Cruises Group at such date determined in accordance with GAAP.

11.17

Negative Undertakings. The Guarantor shall:

(a)

(b)	not, and shall procure that none of its subsidiaries shall

(i)

make loans to any person that is not a direct or indirect subsidiary of the Guarantor;

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not a direct or indirect subsidiary of the Guarantor

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

12	JUDGMENTS AND CURRENCY INDEMNITY

12.1

Judgments relating to Loan Agreement. This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 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 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

13.2

13.3

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 Agent’s and any other Creditor Party’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

14.4

14.5

14.6

14.7

14.8

14.9

14.10

15	ASSIGNMENT AND TRANSFER

15.1

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:

8300 NW 33rd Street # 308, Miami FL33122, USA

Fax No: (00) 1 305 514 2297

or to such other address which the Guarantor may notify to the Agent.

16.2

Application of certain provisions of Loan Agreement. Clauses 32.3 to 32.8 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 Borrower under the Loan Agreement;

(b)	at the same time as the service of a notice under clause 18.22 (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 without specifying a particular sum or aggregate sum.

16.4

17	INVALIDITY OF LOAN AGREEMENT

17.1

Invalidity of Loan Agreement. In the event of:

(a)	the Loan Agreement or any provision thereof now being or later becoming, with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any reason whatsoever; or

(b)	without limiting the scope of paragraph (a), a bankruptcy of the Borrower, the introduction of any law or any other matter resulting in the 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 Borrower had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrower 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 Borrower 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 Finance Documents. Clause 17.1 also applies to each of the other Finance Documents to which the Borrower is a party.

18	GOVERNING LAW AND JURISDICTION

18.1

English law. This Guarantee shall be governed by, and construed in accordance with, English law.

18.2

Exclusive English jurisdiction. Subject to Clause 18.3, the courts of England shall have exclusive jurisdiction to settle any disputes which may arise out of or in connection with this Guarantee.

18.3

Choice of forum for the exclusive benefit of the Creditor Parties. Clause 18.2 is for the exclusive benefit of the Agent, and other Creditor Parties, which reserve the rights:

(a)	to commence proceedings in relation to any matter which arises out of or in connection with this Guarantee 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 matter which arises out of or in connection with this Guarantee.

18.4

18.5

18.6

Meaning of “proceedings”. In this Clause 18, “ proceedings ” means proceedings of any kind, including an application for a provisional or protective measure.

THIS GUARANTEE has been entered into on the date stated at the beginning of this Guarantee.

EXECUTION PAGE


GUARANTOR

SIGNED by FRANK J. DEL RIO		)
for and on behalf of		)
OCEANIA CRUISES INC.		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

LENDERS

SIGNED by GEOFFREY D. FERRER		)
for and on behalf of		)
SOCIÉTÉ GÉNÉRALE		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SIGNED by GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

MANDATED LEAD ARRANGERS

SIGNED by GEOFFREY D. FERRER		)
for and on behalf of		)
SOCIÉTÉ GÉNÉRALE		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SIGNED by GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

AGENT

SIGNED by GEOFFREY D. FERRER		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SCHEDULE 1

FORM OF COMPLIANCE CERTIFICATE

To:

CALYON

9 Quai du Président Paul Doumer

92920 Paris La Défense cedex

France

Attn:

[•]

[•] 200[•]

Dear Sirs

Loan Agreement dated [•] July 2008 (the “Loan Agreement”) made between (1) Riviera New Build, LLC (the “Borrower”), (2) the banks and financial institutions named at schedule 1 therein as leaders, (3) Calyon and Société Générale as Mandated Lead Arrangers and (4) Calyon as Agent and SACE Agent for a loan facility of up to the aggregate of the Dollar Equivalent of EUR 334,590,328.80 and the second instalment of the SACE Premium and Guarantee dated [•] July 2008 (the “Guarantee”) made between (1) us as guarantor and (2) Calyon as Agent

We refer to the Loan Agreement and the Guarantee. Terms defined in the Loan Agreement and the Guarantee have their defined meanings when used in this Compliance Certificate.

We also refer to the financial covenants set out in Clause 11.15 of the Guarantee.

We certify that, as at the date of this Compliance Certificate, in relation to such covenants and by reference to the latest accounts provided under Clause 11.3[ (a)/(b) ] of the Guarantee:

(a)	Free Liquidity is $[•] and therefore [ is/is not ] less than $35,000,000;

(b)	the ratio of EBITDA to Debt Service is [•] and therefore [ is/is not ] less than [ insert relevant minimum ];

(c)	the ratio of Total Debt to EBITDA is [•] and therefore [ does/does not ] exceed [ insert relevant maximum ];

(d)	the ratio of Total Debt to Total Adjusted Equity is [•] and therefore [ does/does not ] exceed [ insert relevant maximum ].

To evidence compliance with the terms of Clause 11.15, we attach:

[a copy of the latest annual consolidated accounts of the Oceania Cruises Group as Appendix A;] or

[copies of the existing quarterly unaudited consolidated accounts of the Oceania Cruises Group for the current Financial Year together with projections for the quarter(s) still to come in the current Financial Year - applies to First Financial Quarter only. ]

No Event of Default has occurred in relation to the Borrower or the Guarantor.

Signed:

Chief Financial Officer of

Oceania Cruises Inc.

SCHEDULE 2

FINANCIAL COVENANT LEVELS

PART A


Financial Year	EBITDA/ Debt Service	Total Debt/ EBITDA	Total Debt/ Total Adjusted Equity
2010	1.02x	15.00x	17.50x
2011	1.02x	10.00x	15.50x
2012	1.02x	7.00x	8.75x
2013	1.10x	5.75x	6.00x
2014	1.10x	4.50x	3.25x
2015	1.20x	4.00x	2.50x
2016	1.25x	3.50x	2.50x
2017	1.30x	3.50x	2.50x
2018	1.30x	3.00x	2.50x
2019	1.30x	3.00x	2.50x
2020	1.30x	3.00x	2.50x
2021	1.30x	3.00x	2.50x
2022	1.30x	3.00x	2.50x
2023	1.30x	3.00x	2.50x

PART B


Financial Year	EBITDA/ Debt Service	Total Debt/ EBITDA	Total Debt/ Total Adjusted Equity
2010	1.10x	14.00x	17.50x
2011	1.10x	9.00x	15.50
2012	1.10x	6.50x	8.75x
2013	1.20x	5.50x	6.00x
2014	1.20x	4.50x	3.25x
2015	1.50x	4.00x	2.50x
2016	1.50x	3.50x	2.50x
2017	1.50x	3.50x	2.50x
2018	1.50x	3.00x	2.50x
2019	1.50x	3.00x	2.50x
2020	1.50x	3.00x	2.50x
2021	1.50x	3.00x	2.50x
2022	1.50x	3.00x	2.50x
2023	1.50x	3.00x	2.50x

Exhibit 10.21

Date 18 July 2008

PRESTIGE CRUISE HOLDINGS INC.

as Guarantor

- and -

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Lenders

-and-

CALYON

SOCIÉTÉ GÉNÉRALE

as Mandated Lead Arrangers

-and-

CALYON

as Agent

GUARANTEE

relating to a Loan Agreement dated 18 July 2008 in respect of

the passenger cruise ship newbulding presently designated as Hull No. 6195

Watson, Farley & Williams

Paris

INDEX


Clause		Page
1	INTERPRETATION		1
2	GUARANTEE		2
3	LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR		2
4	EXPENSES		3
5	ADJUSTMENT OF TRANSACTIONS		3
6	PAYMENTS		3
7	INTEREST		4
8	SUBORDINATION		4
9	ENFORCEMENT		4
10	REPRESENTATIONS AND WARRANTIES		5
11	UNDERTAKINGS		6
12	JUDGMENTS AND CURRENCY INDEMNITY		11
13	SET-OFF		12
14	SUPPLEMENTAL		12
15	ASSIGNMENT AND TRANSFER		13
16	NOTICES		13
17	INVALIDITY OF LOAN AGREEMENT		14
18	GOVERNING LAW AND JURISDICTION		14
EXECUTION PAGE			15
SCHEDULE 1 FORM OF COMPLIANCE CERTIFICATE			16
SCHEDULE 2 FINANCIAL COVENANT LEVELS			17

THIS GUARANTEE is made on 18 July 2008

BETWEEN

(1)

PRESTIGE CRUISE HOLDINGS INC., a Panamanian sociedad anonima having its domicile in the Republic of Panama with its Resident Agent being Arias, Fabrega & Fabrega with address at Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama represented by Frank J. Del Rio duly authorised for the purpose hereof (the “Guarantor” );

(2)	THE BANKS AND FINANCIAL INSTITUTIONS listed in Schedule 1 of the Loan Agreement dated 18 July 2008 (the “Lenders” );

(3)

CALYON, a French “ société anonyme ” , having a share capital of EUR 3,714,724,584 and its registered office located at 9 quai du Président Paul Doumer, 92920 Paris La Défense cedex, France, registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre, and SOCIÉTÉ GÉNÉRALE , a French “ société anonyme ”, having a share capital of EUR 583,228,241.25 and its registered office located at 29 boulevard Haussmann, 75009 Paris, France, registered under the no. Siren 522 120 222 at the Registre du Commerce et des Sociétés of Paris (together the “ Mandated Lead Arrangers ”); and

(4)

CALYON, a French “société anonyme”, having a share capital of EUR 3,714,724,584 and its registered office located at 9, Quai du President Paul Doumer, 92920 Paris La Défense cedex, France, registered under the n° Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre (the “ Agent ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a Master Shipbuilding (Contracts and Options) Agreement dated 14 May 2008 (the “ Master Agreement ”) entered into between (inter alia) Fincantieri - Cantieri Navali Italiani SpA (the “ Builder ”), the Guarantor, Oceania Cruises Inc. and, by way of endorsement, Riviera New Build LLC (the “ Borrower ”) providing for an original shipbuilding contract dated 13 June 2007 (the “ Original Shipbuilding Contract ”) between the Borrower and the Builder to be novated and modified in the form and on the terms set out in the Master Agreement (the Original Shipbuilding Contract as novated and modified by the Master Agreement being hereinafter referred to as the “ Shipbuilding Contract ”), the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a passenger cruise ship currently having hull number 6195

(B)

(C)	The execution and delivery to the Agent of this Guarantee is one of the conditions precedent to the availability of the facility under the said Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Defined expressions. Words and expressions defined in the Loan Agreement shall have the same meanings when used in this Guarantee unless the context otherwise requires.

1.2

Construction of certain terms. In this Guarantee;

“Apollo” means the Fund and any Fund Affiliate;

“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;

“Fund” means Apollo Management VI, L.P. and other co-investment partnerships managed by Apollo Management VI, L.P.;

“Fund Affiliate” means (i) each Affiliate of the Fund that is neither a “portfolio company” (which means a company actively engaged in providing goods or services to unaffiliated customers), whether or not controlled, nor a company controlled by a “portfolio company” and (ii) any individual who is a partner or employee of Apollo Management, L.P., Apollo Management VI, L.P. or Apollo Management V, L.P.;

“Loan Agreement” means the loan agreement dated 18 July 2008 referred to in Recital (A) and includes any existing or future amendments or supplements, whether made with the Guarantor’s consent or otherwise; and

“Management” means the employees of the Guarantor and its subsidiaries or their dependants or any trust for which such persons are the intended beneficiary.

1.3

Application of construction and interpretation provisions of Loan Agreement. Clauses 1.2 to 1.5 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 Borrower under or in connection with the Loan Agreement and every other Finance Document;

(b)	undertakes to pay to the Agent acting on behalf of the Creditor Parties, on the Agent’s demand, any such amount which is not paid by the Borrower when payable;

(c)	undertakes to procure that the Borrower shall perform all its other obligations under the Loan Agreement and every other Finance Document; and

(d)

fully indemnifies the Agent and each other Creditor Party on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Agent 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 Agent or any Creditor Party would otherwise have been entitled to recover.

2.2

No limit on number of demands. The Agent acting on behalf of the Creditor Parties may serve any number of demands under Clause 2.1.

3	LIABILITY AS PRINCIPAL AND INDEPENDENT DEBTOR

3.1

3.2

Waiver of rights and defences. Without limiting the generality of Clause 3.1, 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 any of them;

(b)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents or any of them;

(c)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents or any of them;

(d)	any failure whatsoever 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 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 Agent on its demand the amount of all expenses incurred by the Agent or any other Creditor Party in connection with any matter arising out of this Guarantee or any Security Interest connected with it, including any advice, claim or proceedings relating to this Guarantee or such a Security Interest.

4.2

5	ADJUSTMENT OF TRANSACTIONS

5.1

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 Agent acting on behalf of the other Creditor Parties 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

6.3

7	INTEREST

7.1

Accrual of interest . Any amount due under this Guarantee shall carry interest after the date on which the Agent demands payment of it until it is actually paid, unless interest on that same amount also accrues under the Loan Agreement.

7.2

Calculation of interest. Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

7.3

8	SUBORDINATION

8.1

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, 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 the Borrower or any other Obligor; or

(d)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Creditor Party under a Finance Document.

9	ENFORCEMENT

9.1

9.2

Conclusive evidence of certain matters. However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement, shall be binding and conclusive as to all matters of fact and law to which it relates.

9.3

10	REPRESENTATIONS AND WARRANTIES

10.1

10.2

Status. The Guarantor is duly incorporated and validly existing and in good standing under the laws of Panama.

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 remain in force and nothing has occurred which makes any of them liable to revocation.

10.5

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; or

(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

10.8

No default. To the knowledge of the Guarantor, no Event of Default has occurred and is continuing.

10.9

10.10

10.11

11	UNDERTAKINGS

11.1

11.2

11.3

Provision of financial statements. The Guarantor will send to the Agent:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2008, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)

(c)	such projections (in such format as may be approved by the Agent) as may be required under the terms of the proviso to Clause 11.15 (b) for the purposes of applying the Financial Covenants set out in Clause 11.15 at the end of the First Financial Quarter (as defined in Clause 11.16);

(d)

(e)

(f)	such additional financial or other relevant information regarding the Guarantor and the Group as the Agent may reasonably request.

11.4

Form of financial statements. All accounts (audited and unaudited) delivered under Clause 11.3 will:

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Agent;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5

11.6

Consents. The Guarantor will maintain in force and promptly obtain or renew, and will promptly send certified copies to the Agent of, all consents required:

(a)	for the Guarantor to perform its obligations under this Guarantee;

(b)	for the validity or enforceability of this Guarantee;

and the Guarantor will comply with the terms of all such consents.

11.7

11.8

Domicile and principal place of business. The Guarantor:

(a)	will maintain its domicile, and keep its corporate documents and records, with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Agent;

(b)	will maintain its principal place of business in the United States of America at 8300 NW 33rd Street # 308, Miami FL33122, USA or at such other address in the United States of America as is notified beforehand to the Agent; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Agent, acting with the authorization of the Creditor Parties, such agreement not to be unreasonably withheld.

11.9

11.10

Maintenance of status. The Guarantor will maintain its separate corporate existence and remain in good standing under the laws of Panama.

11.11

Negative pledge. The Guarantor shall not, and shall procure that neither Oceania Cruises nor the Borrower will, create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Agent or otherwise permitted by the Finance Documents;

(b)	in the case of the Guarantor and Oceania Cruises, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor or Oceania Cruises respectively;

(c)	in the case of the Borrower, Security Interests permitted under clause 13.5 of the Loan Agreement;

(d)

Security Interests provided in favour of lenders under and in connection with any refinancing of the Existing Indebtedness or any financing arrangements entered into by any member of the Group for the acquisition of additional or replacement ship(s) (including any refinancing of any such arrangement) but limited to:

(i)

pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)

ship mortgages and other securities over the financed ship(s),

11.12

No disposal of assets, change of business. The Guarantor will:

(a)

(b)

11.13

No merger etc. The Guarantor shall not enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity (each of the foregoing being a “Transaction”) unless:

(a)

(b)	the relevant Transaction does not require or involve or result in any dissolution of the Guarantor so that at all times the Guarantor remains in existence; and

(c)	each notice delivered to the Agent pursuant to paragraph (a) above is accompanied by a certificate signed by the Chief Financial Officer of the Guarantor whereby the Guarantor represents and warrants to the Agent that the relevant Transaction will not:

(i)

adversely affect the ability of any Obligor to perform its obligations under the Finance Documents;

(ii)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; or

(iii)

affect the ability of the Guarantor to comply with the financial covenants contained in Clause 11.15.

11.4

Maintenance of ownership of Borrower and Guarantor.

(a)

The Guarantor shall remain the legal holder and direct beneficial owner of the entire issued and allotted share capital of Oceania Cruises, free from any Security Interest and Oceania Cruises shall remain the legal holder and direct beneficial owner of all membership interest in. the Borrower, free from any Security Interest, except that created in favour of the Agent acting on behalf of the other Creditor Parties;

(b)

prior to any underwritten public offering of the equity interests of the Guarantor (or any direct or indirect parent of the Guarantor) which generates cash proceeds to Oceania Cruises of at least $ 150 million (a “Qualified IPO” ), a combination of Apollo and Management (the “Permitted Holders” ) shall at all times own beneficially (within the meaning of Rules 13d-3 and 13d-5 of The Securities Exchange Act of 1934 (15 USC §78a et seq.) (the “Exchange Act” ) as in effect on the Delivery Date) directly or indirectly, in the aggregate, equity interests representing at least a majority of the aggregate ordinary voting power represented by the issued and outstanding equity interests of the Guarantor; or.

(c)

11.5

Financial Covenants. The Guarantor shall ensure that for each relevant Financial Year and by reference to the accounts delivered under Clause 11.3 at the end of the First Financial Quarter and thereafter at the end of each Financial Year:

(a)	the ratio of Total Debt to EBITDA for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2; and

(b)	the ratio of Total Debt to Total Adjusted Equity for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2;

provided that the “relevant Financial Year” shall mean, at the end of the First Financial Quarter, the Financial Year of which that First Financial Quarter forms part and. to the extent that there remain financial quarters still to come, in such Financial Year, the relevant numbers for calculation of the Financial Covenants at such time shall be made up of unaudited consolidated accounts for those quarters that have already taken place and of projected consolidated accounts for any quarter(s) still to come, such projections to be prepared by the Guarantor in such form and on such basis as may be reasonably acceptable to the Agent acting on behalf of the Creditor Parties, including, being consistent with the approach adopted in the quarters that have taken place already.

11.16

Financial definitions. For the purposes of Clause 11.15:

(a)	“EBITDA” means, for any relevant period, the aggregate of:

(i)

Net Income from the Group’s operations for such period; and

(ii)

less

(iii)

gains from the sale of assets and any non-cash profits;

(b)	“Financial Year” means any financial year of the Group ending on 31 December;

(c)	“First Financial Quarter” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

(d)	“Indebtedness” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:

(i)

moneys borrowed or raised;

(ii)

the advance or extension of credit (including interest and other charges on or in respect of the foregoing);

(iii)

the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;

(iv)

the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

(v)

all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and

(vi)

(without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;

PROVIDED THAT the following shall not constitute Indebtedness:

(aa)

loans and advances made by members of the Group to other members of the Group which are subordinated to the rights of the Creditor Parties; and

(bb)

any liabilities of the Guarantor or any other member of the Group to a counterparty under any master agreement relating to the interest or currency exchange of a non-speculative nature;

(e)	“Interest Expense” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Group for such period;

(f)	“Net Income” means, for any relevant period, the consolidated net income (or loss) of the Group for such period as determined in accordance with GAAP;

(g)	“Total Debt” means, as at any relevant date, Indebtedness of the Group;

(h)	“Total Adjusted Equity” means, at any date of determination, Total Equity at such date, as adjusted to exclude the direct or indirect impact of any hedging or similar arrangements on the consolidated stockholders’ equity of the Group as at such date as required under GAAP; and

(i)	“Total Equity” means, at any date of determination, the consolidated stockholders’ equity of the Group at such date determined in accordance with GAAP.

11.17

Negative Undertakings. The Guarantor shall;

(a)

(b)	not, and shall procure that none of its subsidiaries shall:

(i)

make loans to any person that is not a direct or indirect subsidiary of the Guarantor; or

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not a direct or indirect subsidiary of the Guarantor

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

12	JUDGMENTS AND CURRENCY INDEMNITY

12.1

Judgments relating to Loan Agreement. This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 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 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.

13.2

13.3

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

14.3

14.4

14.5

14.6

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 and 17 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 and 17.

14.8

14.9

14.10

15	ASSIGNMENT AND TRANSFER

15.1

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:

8300 NW 33rd Street # 308, Miami FL33122, USA

Fax No: (00) 1 305 514 2297

or to such other address which the Guarantor may notify to the Agent

16.2

Application of certain provisions of Loan Agreement. Clauses 32.3 to 32.8 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 Borrower under the Loan Agreement;

(b)	at the same time as the service of a notice under clause 18.22 (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 without specifying a particular sum or aggregate sum.

16.4

17	INVALIDITY OF LOAN AGREEMENT

17.1

Invalidity of Loan Agreement. In the event of:

(a)	the Loan Agreement or any provision thereof now being or later becoming, with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any reason whatsoever; or

(b)	without limiting the scope of paragraph (a), a bankruptcy of the Borrower, the introduction of any law or any other matter resulting in the 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 Borrower had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrower 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 Borrower 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 Finance Documents. Clause 17.1 also applies to each of the other Finance Documents to which the Borrower is a party.

18	GOVERNING LAW AND JURISDICTION

18.1

English law. This Guarantee shall be governed by, and construed in accordance with, English law.

18.2

Exclusive English jurisdiction. Subject to Clause 18.3, the courts of England shall have exclusive jurisdiction to settle any disputes which may arise out of or in connection with this Guarantee.

18.3

Choice of forum for the exclusive benefit of the Creditor Parties. Clause 18.2 is for the exclusive benefit of the Agent and other Creditor Parties, which reserve the rights:

(a)	to commence proceedings in relation to any matter which arises out of or in connection with this Guarantee 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 matter which arises out of or in connection with this Guarantee.

18.4

18.5

18.6

Meaning of “proceedings”. In this Clause 18, “proceedings” means proceedings of any kind, including an application for a provisional or protective measure.

THIS GUARANTEE has been entered into on the date stated at the beginning of this Guarantee.

EXECUTION PAGE

GUARANTOR


SIGNED by Frank J. Del Rio		)
for and on behalf of		)
PRESTIGE CRUISE HOLDINGS		)
INC.		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

LENDERS
SIGNED by Geoffrey D. Ferrer		)
for and on behalf of		)
SOCIÉTÉ GÉNÉRALE		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SIGNED by Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

MANDATED LEAD ARRANGERS

SIGNED by Geoffrey D. Ferrer		)
for and on behalf of		)
SOCIÉTÉ GÉNÉRALE		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SIGNED by Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

AGENT
SIGNED by Geoffrey D. Ferrer		)
for and on behalf of		)
CALYON		)
as its duly appointed attorney-in-fact		)
in the presence of:		)

SCHEDULE I

FORM OF COMPLIANCE CERTIFICATE

To:

CALYON

9 Quai du President Paul Doumer

92920 Paris La Defense cedex

France

Attn: [ — ]

[ — ] 200[ — ]

Dear Sirs

Loan Agreement dated [ — ] July 2008 (the “Loan Agreement”) made between (1) Riviera New Build, LLC (the “Borrower”), (2) the banks and financial institutions named at schedule 1 therein as lenders, (3) Calyon and Société Generate as Mandated Lead Arrangers and (4) Calyon as Agent and SACE Agent for a loan facility of up to the aggregate of the Dollar Equivalent of EUR 334,590,328.80 and the second instalment of the SACE Premium and Guarantee dated [ — ] July 2008 (the “Guarantee”) made between (1) us as guarantor and (2) Calyon as Agent

We refer to the Loan Agreement and the Guarantee. Terms defined in the Loan Agreement and the Guarantee have their defined meanings when used in this Compliance Certificate.

We also refer to the financial covenants set out in Clause 11.15 of the Guarantee.

We certify that, as at the date of this Compliance Certificate, in relation to such covenants and by reference to the latest accounts provided under Clause 11.3 [(a)/(b)] of the Guarantee:

(a)	the ratio of Total Debt to EBITDA is [ — ] and therefore [ does/does not ] exceed [ insert relevant maximum ];

(b)	the ratio of Total Debt to Total Adjusted Equity is [ — ]and therefore [ does/does not ] exceed [ insert relevant maximum ].

To evidence compliance with the terms of Clause 11.15, we attach:

[a copy of the latest annual consolidated accounts of the Group as Appendix A;] or

No Event of Default has occurred in relation to the Borrower or the Guarantor.

Signed:

Chief Financial Officer of

Prestige Cruise Holdings Inc.

SCHEDULE 2

FINANCIAL COVENANT LEVELS


Financial Year	Total Debt/ EBITDA	Total Debt/ Total Adjusted Equity
2010	13.00x	11.00x
2011	9.50x	8.50x
2012	6.50x	4.50x
2013	5.75x	3.00x
2014	4.50x	2.50x
2015	4.00x	2.50x
2016	3.50x	2.50x
2017	3.50x	2.50x
2018	3.00x	2.50x
2019	3.00x	2.50x
2020	3.00x	2.50x
2021	3.00x	2.50x
2022	3.00x	2.50x
2023	3.00x	2.50x

Exhibit 10.22

Execution Version

Dated 31 July 2013

SEVEN SEAS CRUISES S. DE R.L.

as Guarantor

- and -

CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK

as Security Trustee

Guarantee

relating to

a Loan Agreement dated 31 July 2013 in respect of the passenger

cruise ship newbuilding presently designated as Hull No. 6250

Execution Version

Index


Clause		Page
1	Interpretation		1
2	Guarantee		2
3	Liability as Principal and Independent Debtor		2
4	Expenses		3
5	Adjustment of Transactions		3
6	Payments		4
7	Interest		4
8	Subordination		5
9	Enforcement		5
10	Representations and Warranties		6
11	Undertakings		7
12	Judgments and Currency Indemnity		12
13	Set Off		12
14	Supplemental		12
15	Assignment and Transfer		14
16	Notices		14
17	Invalidity of Loan Agreement		15
18	Governing Law and Jurisdiction		15

Schedules

Schedule 1 Form of Compliance Certificate			18

Execution

Execution Page			17

Execution Version

THIS GUARANTEE is made on 31 July 2013

BETWEEN

(1)

SEVEN SEAS CRUISES S. DE R.L., a Panamanian sociedad de responsilidad limitada having its domicile in the Republic of Panama with its resident agent being Arias, Fabrega & Fabrega (the “ Resident Agent ”) with address at Plaza 2000 Building, 16 ^th Floor, 50 ^th Street, Panama, Republic of Panama represented by duly authorised for the purpose hereof as guarantor (the “ Guarantor ”);

(2)

CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK a société anonyme , having a share capital of EUR 7.254.575.271 and its registered office located at 9, quai du Président Paul Doumer, 92920 Paris La Défense Cedex, France registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre as security trustee (the “ Security Trustee ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a memorandum of agreement dated October 12th, 2012 (as amended from time to time) entered into between (i) Fincantieri - Cantieri Navali Italiani SpA, a company incorporated in Italy with registered office in Trieste, via Genova, 1, and having fiscal code 00397130584 (the “ Builder ”) and (ii) Prestige Cruise Holdings Inc. and a shipbuilding contract dated 21 June 2013 (the “ Shipbuilding Contract ”) entered into between (i) the Builder and (ii) the Borrower, the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a 738 passenger cruise ship currently having hull number 6250 as more particularly described in the Shipbuilding Contract to be delivered on 30 June 2016 subject to any adjustments of such delivery date in accordance with the Shipbuilding Contract

(B)

By a Loan Agreement dated July 2013 and made between (i) the Borrower, (ii) the Lenders, (iii) the Joint Mandated Lead Arrangers, (iv) the Agent and SACE Agent and (v) the Security Trustee, it was agreed that the Lenders would make available to the Borrower a loan facility of the Dollar Equivalent of up to EUR 299,866,962 for the purpose of assisting the Borrower in financing (a) payment under the Shipbuilding Contract of all or part of 80% of the Final Contract Price up to the Eligible Amount, (b) payment to the Borrower of the Dollar Equivalent of 100% of the first instalment of the SACE Premium already paid direct to SACE on or before 30 days following the issuance of the SACE Insurance Policy and (c) payment to SACE of the Dollar Equivalent of 100% of the second instalment of the SACE Premium.

(C)	The execution and delivery to the Security Trustee of this Guarantee is one of the conditions precedent to the availability of the facility under the Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Defined expressions

Words and expressions defined in the Loan Agreement shall have the same meanings when used in this Guarantee unless the context otherwise requires.

1.2

Construction of certain terms

In this Guarantee:

Execution Version

“ Loan Agreement ” means the loan agreement dated July 2013 referred to in Recital (A) and includes any existing or future amendments or supplements, whether made with the Guarantor’s consent or otherwise.

“ Seven Seas Group ” means the Guarantor and its subsidiaries.

1.3

Application of construction and interpretation provisions of Loan Agreement

Clauses 1.2 to 1.5 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 to the Security Trustee punctual performance by the Borrower of all the Borrower’s obligations under or in connection with the Loan Agreement and every other Finance Document;

(b)	undertakes to the Security Trustee that whenever the Borrower does not pay any amount when due under or in connection with the Loan Agreement and the other Finance Documents, the Guarantor shall immediately on demand pay that amount as if it was the principal obligor;

(c)

agrees that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Security Trustee and each other Secured Party immediately on demand by the Security Trustee against any cost, loss or liability it incurs as a result of the Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under the Loan Agreement or any other Finance Document on the date when it would have been due. Any such demand for indemnification shall be made through the Security Trustee, for itself or on behalf of the Security Parties. The amount payable by a Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause 2.1 if the amount claimed had been recoverable on the basis of a guarantee.

2.2

No limit on number of demands

The Security Trustee may serve any number of demands under Clause 2.1.

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, the obligations of the Guarantor under this Guarantee will not be affected by an act, omission, matter or thing which, but for this Clause, would reduce, release or prejudice any of its obligations under this Guarantee (without limitation and whether or not known to it or any Secured Party) including:

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

Execution Version

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

(c)

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

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

(e)

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

(f)	any insolvency or similar proceedings;

(g)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents;

(h)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents;

(i)	any failure whatsoever 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

(j)	any other Finance Document 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 the amount of all expenses incurred by the Security Trustee or any other Secured Party in connection with any matter arising out of this Guarantee or any Security Interest connected with it, including any advice, claim or proceedings relating to this Guarantee or such a Security Interest.

4.2

Fees and expenses payable under Loan Agreement

Clause 4.1 is without prejudice to the Guarantor’s liabilities in respect of the Borrower’s obligations under clauses 9 (Fees) and 10 (Taxes, Increased Costs and Related Charges) of the Loan Agreement and under similar provisions of other Finance Documents.

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 Secured Party is required, or agrees, to pay pursuant to any claim by, or settlement with, a trustee in bankruptcy of the Borrower or of any other Obligor (or similar person) on the ground that the Loan Agreement or any other Finance Document, or a payment by the Borrower or of such other Obligor, was invalid or on any similar ground.

Execution Version

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 Secured 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 Credits

If an additional payment is made by the Guarantor under this Clause and any Secured Party determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction giving rise to such additional payment, such Secured Party shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Guarantor such amount as such Secured Party shall in its reasonable opinion have concluded to be attributable to the relevant deduction. Any such payment shall be conclusive evidence of the amount due to the Guarantor hereunder and shall be accepted by the Guarantor in full and final settlement of its rights of reimbursement hereunder in respect of such deduction. Nothing herein contained shall interfere with the right of each Secured Party to arrange its tax affairs in whatever manner it thinks fit.

6.4

To the extent that this Clause 6 ( Payments ) imposes obligations or restrictions on a Secured Party, such obligations or restrictions shall not apply to SACE and SACE shall have no obligations hereunder nor be constrained by such restrictions.

7	INTEREST

7.1

Accrual of interest

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, unless interest on that same amount also accrues under the Loan Agreement.

7.2

Calculation of interest

Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

Execution Version

7.3

Guarantee extends to interest payable under Loan Agreement

For the avoidance of doubt, it is confirmed that this Guarantee covers all interest payable under the Loan Agreement, including that payable under clause 17 of the Loan Agreement.

8	SUBORDINATION

8.1

Subordination of rights of Guarantor

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full and unless the Agent otherwise directs, all rights which the Guarantor at any time has (whether in respect of this Guarantee or any other transaction) against the Borrower, any other Obligor or their respective assets shall be fully subordinated to the rights of the Secured Parties under the Finance Documents and in particular, the Guarantor shall not:

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, whether in respect of this Guarantee or any other transaction;

(b)	take or enforce any Security Interest for any such amount;

(c)	exercise any right to be indemnified by an Obligor;

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

(e)	claim to set-off any such amount against any amount payable by the Guarantor to the Borrower or any other Obligor; or

(f)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Secured Party under a Finance Document.

If the Guarantor receives any benefit, payment or distribution in relation to such rights it shall hold that benefit, payment or distribution to the extent necessary to enable all amounts which may be or become payable to the Finance Parties by the Obligors under or in connection with the Finance Documents to be repaid in full on trust for the Finance Parties and shall promptly pay or transfer the same to the Security Trustee or as the Security Trustee may direct for application in accordance with the Loan Agreement and the Finance Documents.

9	ENFORCEMENT

9.1

No requirement to commence proceedings against Borrower

The Guarantor waives any right it may have of first requiring the Security Trustee or any other Secured Party to proceed against or enforce any other rights or security or claim payment from any person before claiming from that Guarantor under this Guarantee. Neither the Security Trustee nor any other Secured Party will need to make any demand under, commence any proceedings under, or enforce any guarantee or any Security Interest contained in or created by, the Loan Agreement or any other Finance Document before claiming or commencing proceedings under this Guarantee. This waiver applies irrespective of any law or any provision of a Finance Document to the contrary.

Execution Version

9.2

Conclusive evidence of certain matters

However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement,

shall be binding and conclusive as to all matters of fact and law to which it relates.

9.3

Suspense account

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full, the Security Trustee and any Secured Party may:

(a) refrain from applying or enforcing any other moneys, security or rights held or received by it (or any trustee or agent on its behalf which, in the case of a Secured Party, shall include the Agent and the Security Trustee) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and the Guarantor shall not be entitled to the benefit of the same; and

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

10	REPRESENTATIONS AND WARRANTIES

10.1

General

The Guarantor represents and warrants to the Security Trustee as follows on the date of this Guarantee, which representations and warranties shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day from the date of this Guarantee to the end of the Security Period.

10.2

Status

The Guarantor is duly organised and validly existing as a sociedad de responsilidad limitada and in good standing under the laws of Panama.

10.3

Corporate power

As a sociedad de responsilidad limitada organised under the laws of Panama, the Guarantor has the capacity, and has taken all 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 remain in force and nothing has occurred which makes any of them liable to revocation.

Execution Version

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; or

(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 Panama and the United States of America.

10.8

No default

To the knowledge of the Guarantor, no Event of Default has occurred which is continuing.

10.9

Information

All information which has been provided in writing by or on behalf of the Guarantor to the Security Trustee or any other Secured Party in connection with any Finance Document satisfied the requirements of Clause 11.2; all audited and unaudited accounts which have been so provided satisfied the requirements of Clause 11.4; 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 accounts.

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

No Security Interests

None of the assets or rights of the Guarantor is subject to any Security Interest except any Security Interest which (i) qualifies as a Permitted Security Interest with respect to the Guarantor or (ii) is permitted by Clause 11.11.

11	UNDERTAKINGS

11.1

General

The Guarantor undertakes with the Security Trustee to comply with the following provisions of this Clause 11 at all times from the date of this Deed to the end of the Security Period, except as the Security Trustee may otherwise permit.

Execution Version

11.2

Information provided to be accurate

All financial and other information which is provided in writing by or on behalf of the Guarantor under or in connection with this Guarantee will be true and not misleading and will not omit any material fact or consideration.

11.3

Provision of financial statements

The Guarantor will send to the Security Trustee:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2013, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)	as soon as practicable (and in any event within ninety (90) days of the commencement of each financial year) the budgetary forecast (profit and loss statement, balance sheet statement and cash flow statement) of the Guarantor for the two following years;

(c)

as soon as practicable (and in any event within forty-five (45) days of the end of the contemplated quarter in respect of the first three quarters of each fiscal year and 90 days in respect of the final quarter) a copy of the unaudited consolidated quarterly management accounts (including current and year to date profit and loss statements and balance sheet compared to the previous year and to budget) of the Guarantor certified as to their correctness by the chief financial officer of the Guarantor;

(d)

a compliance certificate in the form set out in Schedule 1 to this Guarantee or in such other form as the Security Trustee may reasonably require (each a “ Compliance Certificate ”) at the same time as there is delivered to the Security Trustee, and together with, each set of audited consolidated accounts under paragraph (a) and the set of unaudited consolidated accounts under paragraph (b) which constitute those for the First Financial Quarter, duly signed by the chief financial officer of the Guarantor and certifying whether or not the requirements of Clause 11.15 are then complied with; and

(e)	such additional financial or other relevant information regarding the Guarantor and the Seven Seas Group as the Security Trustee may reasonably request.

11.4

Form of financial statements

All accounts (audited and unaudited) delivered under Clause 11.3 will:

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Security Trustee provided that, such approval by the Security Trustee shall not be unreasonably withheld or delayed;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5

Shareholder and creditor notices

The Guarantor will send the Security Trustee, at the same time as they are despatched, copies of all communications which are despatched to the Guarantor’s shareholders or creditors generally or any class of them.

Execution Version

11.6

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;

(b)	for the validity or enforceability of this Guarantee;

and the Guarantor will comply with the terms of all such consents.

11.7

Notification of litigation

The Guarantor will provide the Security Trustee with details of any material 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 (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding ten million Dollars or the equivalent in another currency).

11.8

Domicile and principal place of business

The Guarantor:

(a)	will maintain its domicile with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Security Trustee;

(b)	will maintain its principal place of business and keep its corporate documents and records in the United States of America at 8300 N.W. 33 ^rd St., Suite 100, Miami, 33122, Florida, or at such other address in the United States of America as is notified beforehand to the Security Trustee; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Security Trustee, acting with the authorisation of the Secured Parties, such agreement not to be unreasonably withheld.

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 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 Panama.

11.11

Negative pledge

The Guarantor shall not, and shall procure that the Borrower will not create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Security Trustee or otherwise permitted by the Finance Documents;

Execution Version

(b)	in the case of the Guarantor, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor;

(c)	in the case of the Borrower, Security Interests permitted under clause 13.5 of the Loan Agreement;

(d)

Security Interests provided in favour of lenders under and in connection with any refinancing of the Existing Indebtedness or any financing arrangements entered into by any member of the Seven Seas Group for the acquisition of additional or replacement ship(s) (including any refinancing of any such arrangement) but limited to:

(i)

pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)

ship mortgages and other securities over the financed ship(s).

11.12

No disposal of assets, change of business

The Guarantor will:

(a)

(b)

continue to be the member of a group of companies whose main business is the operation of cruise vessels as well as the marketing of cruises on board such vessels and the Guarantor will not change its main line of business so as to affect any Obligor’s ability to perform its obligations under the Finance Documents or to imperil, in the opinion of the Security Trustee, the security created by any of the Finance Documents or the SACE Insurance Policy.

11.13

No merger etc

The Guarantor shall not, and shall procure that none of its subsidiaries will, enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity without the prior consent of the Secured Parties, such consent not to be unreasonably withheld, provided that in any case and subject always to the provisions of Clauses 11.14 and 11.17, reorganisations (other than reorganisations directly involving the Borrower) of subsidiaries of the Guarantor and the creation of new subsidiaries of the Guarantor shall be permitted.

11.14

Maintenance of ownership of Borrower and Guarantor

Unless otherwise agreed/consented to by the Secured Parties, Prestige Holdings shall remain direct or indirect beneficial owner of the entire issued and allotted share capital of the Guarantor, free from any Security Interest and the Guarantor shall remain the legal holder and direct beneficial owner of all membership interest in the Borrower, free from any Security Interest, except that created in favour of the Security Trustee.

11.15

Financial Covenants

The Guarantor shall ensure that for each relevant Financial Year and by reference to the accounts delivered under Clause 11.3 that at all times beginning at the end of the First Financial Quarter the minimum Free Liquidity will be not less than Thirty five million Dollars ($ 35,000,000)

Execution Version

11.16

Financial definitions

For the purposes of Clause 11.15:

“ Cash Balance ” means, at the date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Seven Seas Group;

“ Financial Year ” means any financial year of the Seven Seas Group ending on 31 December;

“ First Financial Quarter ” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

“ Free Liquidity ” means, at any date of determination, the aggregate of the Cash Balance and any amounts freely available for drawing under any revolving credit facilities of the Seven Seas Group, which remain undrawn, could be drawn for general working capital purposes or other general corporate purposes and would not, if drawn, be repayable within six (6) months.

11.17

Negative Undertakings

The Guarantor shall:

(a)

not at any time after the end of the First Financial Quarter, declare or pay dividends or make any other distributions or payment in respect of Financial Indebtedness owed to its shareholders without the prior written consent of the Agent, provided that the Guarantor may declare and pay dividends to its shareholders after the Delivery Date or make any other distributions or payments in respect of Financial Indebtedness owed to the shareholders subject to (i) it on each such occasion satisfying the Agent acting on behalf of the Secured Parties that it will continue to meet all the requirements of Clause 11.15, if such covenant was to be tested immediately following the payment of any such dividend and (ii) there being no Event of Default which is continuing under the Loan Agreement and no Event of Default shall arise from the payment of such dividend.;

(b)	not, and shall procure that none of its subsidiaries shall:

(i)

make loans to any person that is not the Guarantor or a direct or indirect subsidiary of the Guarantor; or

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not the Guarantor or a direct or indirect subsidiary of the Guarantor

except if such loan is granted to a non subsidiary or such guarantee is issued in the ordinary course of business covering the obligations of a non subsidiary and the aggregate amount of all such loans and guarantees made or issued by the Guarantor and its subsidiaries does not exceed USD25,000,000 or is otherwise approved by the Security Trustee which approval shall not be unreasonably withheld if such loan or guarantee in respect of a non subsidiary would neither:

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

affect the ability of the Guarantor to comply with the financial covenant contained in Clause 11.15 if such covenant was to be tested immediately following the grant of such loan or the issuance of such guarantee, as demonstrated by evidence satisfactory to the Security Trustee.

Execution Version

12	JUDGMENTS AND CURRENCY INDEMNITY

12.1

Judgments relating to Loan Agreement

This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 Secured Party may 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 the Guarantor at any office in any country of that Secured Party in or towards satisfaction of any sum then due from the Guarantor to that Secured 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Secured Party concerned considers appropriate.

13.2

Existing rights unaffected

No Secured Party shall be obliged to exercise any of its rights under Clause 13.1; 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 Secured 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, a sum payable by the Guarantor to 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, regardless of any intermediate payment or discharge in whole or in part.

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.

Execution Version

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 is in addition to and 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 Secured Party may now or later hold in connection with the Loan 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 Security Parties in the same way 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 and 17 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 and 17.

14.8

Applicability of provisions of Guarantee to other rights

Clauses 3 and 17 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 and 17), being an agreement referring to this Guarantee.

14.9

Third party rights

Other than a Secured Party or the Italian Authorities, no person who is not a party to this Guarantee has any right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Guarantee.

14.10

Waiver of rights against SACE

Nothing in this Guarantee or any of the Finance Documents is intended to grant to the Guarantor or any other person any right of contribution from or any other right or claim against SACE and the Guarantor hereby waives irrevocably any right of contribution or other right or claim as between itself and SACE.

Execution Version

15	ASSIGNMENT AND TRANSFER

15.1

Assignment and transfer by Security Trustee

The Security Trustee may assign or transfer its rights under and in connection with this Guarantee to the same extent as it may assign or transfer its rights under the Loan Agreement.

The Guarantor may not assign or transfer its rights under and in connection with this Guarantee.

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:

Seven Seas Cruises S. DE. R.L.

8300 N.W. 33rd St, Suite 100

Miami

Florida, 33122

Fax: (305) 392-2582

or to such other address which the Guarantor may notify to the Security Trustee.

16.2

Application of certain provisions of Loan Agreement

Clauses 30.3 to 30.8 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 Borrower under the Loan Agreement;

(b)	at the same time as the service of a notice under clause 18.21 ( 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 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.

Execution Version

17	INVALIDITY OF LOAN AGREEMENT

17.1

Invalidity of Loan Agreement

In the event of:

(a)	the Loan Agreement or any provision thereof now being or later becoming, with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any reason whatsoever; or

(b)	without limiting the scope of paragraph (a), a bankruptcy of the Borrower, the introduction of any law or any other matter resulting in the 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 Borrower had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrower 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 Borrower 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 Finance Documents

Clause 17.1 also applies to each of the other Finance Documents to which the 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, the courts of England shall have exclusive jurisdiction to settle any Dispute.

18.3

Choice of forum for the exclusive benefit of the Security Trustee

Clause 18.2 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 Dispute; and

(b)	to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.

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 EC3 Services Limited at its registered office for the time being, presently at The St Botolph Building, 138 Houndsditch, London, EC3A 7AR, 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 a Dispute.

Execution Version

18.5

Secured Parties’ rights unaffected

Nothing in this Clause 18 shall exclude or limit any right which any Secured 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, “ 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.

Execution Version

EXECUTION PAGE


GUARANTOR

SIGNED by Paul Turner		) /s/ Paul Turner
for and on behalf of		)
SEVEN SEAS CRUISES S. DE R.L.		)
as its duly appointed attorney-in-fact		)
in the presence of: Jessica Greenwood		)

SECURITY TRUSTEE

SIGNED by Jerome Leblond		) /s/ Jerome Leblond
for and on behalf of		)
CRÉDIT AGRICOLE CORPORATE		)
AND INVESTMENT BANK		)
as its duly appointed attorney-in-fact		)
in the presence of: Jessica Greenwood		)

Execution Version

SCHEDULE 1

FORM OF COMPLIANCE CERTIFICATE

To:	CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK

9 Quai du Président Paul Doumer

92920 Paris La Défense cedex

France

Attn: [ — ]

[ — ] 200[ — ]

Dear Sirs

Loan Agreement dated [ — ] 2013 (the “Loan Agreement”) made between (1) Explorer New Build, LLC (the “Borrower”), (2) the banks and financial institutions named at schedule 1 therein as lenders, (3) Credit Agricole Corporate and Investment Bank, Société Générale, HSBC Bank plc and KFW IPEX Bank Gmbh as Joint Mandated Lead Arrangers, (4) Credit Agricole Corporate and Investment Bank as Agent and SACE Agent and (5) Credit Agricole Corporate and Investment Bank as Security Trustee for a loan facility of up to the aggregate of the Dollar Equivalent of EUR 299,866,962 and Guarantee dated [ — ] 2013 (the “Guarantee”) made between (1) us as guarantor and (2) Credit Agricole Corporate and Investment Bank as Security Trustee

We refer to the Loan Agreement and the Guarantee. Terms defined in the Loan Agreement and the Guarantee have their defined meanings when used in this Compliance Certificate.

We also refer to the financial covenant set out in Clause 11.15 of the Guarantee.

We certify that, as at the date of this Compliance Certificate, in relation to such covenant and by reference to the latest accounts provided under Clause 11.3[ (a)/(b) ] of the Guarantee:

Free Liquidity is $[ — ] and therefore [ is/is not ] less than $35,000,000;

To evidence compliance with the terms of Clause 11.15, we attach:

[a copy of the latest annual consolidated accounts of the Seven Seas Group as Appendix A;] or

[copies of the existing quarterly unaudited consolidated accounts of the Seven Seas Group for the current Financial Year together with projections for the quarter(s) still to come in the current Financial Year - applies to First Financial Quarter only .]

No Event of Default has occurred in relation to the Borrower or the Guarantor.

Signed:

Chief Financial Officer of

Seven Seas Cruises S. De. R. L.

Exhibit 10.23

Execution Version

Dated 31 July 2013

PRESTIGE CRUISE HOLDINGS INC.

as Guarantor

- and -

CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK

as Security Trustee

GUARANTEE

relating to

a Loan Agreement dated 31 July 2013 in respect of the passenger

cruise ship newbuilding presently designated as Hull No. 6250

Execution Version

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		14
13	Set Off		14
14	Supplemental		15
15	Assignment and Transfer		16
16	Notices		16
17	Invalidity of Loan Agreement		17
18	Governing Law and Jurisdiction		18

Schedules

Schedule 1 Form of Compliance Certificate			20
Schedule 2 Financial Covenant Levels			21

Execution

Execution Page			19

Execution Version

THIS GUARANTEE is made on 31 July 2013

BETWEEN

(1)

PRESTIGE CRUISE HOLDINGS INC ., a Panamanian sociedad anonima having its domicile in the Republic of Panama with its resident agent being Arias, Fabrega & Fabrega (the “Resident Agent”) with address at Plaza 2000 Building, 16th Floor, 50th Street, Panama, Republic of Panama represented by duly authorised for the purpose hereof as guarantor (the “Guarantor”);

(2)

CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK (formerly known as Calyon) a société anonyme , having a share capital of EUR 7,254,575,271 and its registered office located at 9, quai du Président Paul Doumer, 92920 Paris La Défense Cedex, France registered under the no. Siren 304 187 701 at the Registre du Commerce et des Sociétés of Nanterre as security trustee (the “ Security Trustee ”, which expression includes its successors and assigns).

BACKGROUND

(A)

By a memorandum of agreement dated October 12th, 2012 (as amended from time to time) entered into between (i) Fincantieri—Cantieri Navali Italiani SpA, a company incorporated in Italy with registered office in Trieste, via Genova, 1, and having fiscal code 00397130584 (the “ Builder ”) and (ii) Prestige Cruise Holdings Inc. and a shipbuilding contract dated 21 June 2013 (the “ Shipbuilding Contract ”) entered into between (i) the Builder and (ii) the Borrower, the Builder has agreed to design, construct and deliver, and the Borrower has agreed to purchase, a 738 passenger cruise ship currently having hull number 6250 as more particularly described in the Shipbuilding Contract to be delivered on 30 June 2016 subject to any adjustments of such delivery date in accordance with the Shipbuilding Contract.

(B)

(C)	The execution and delivery to the Security Trustee of this Guarantee is one of the conditions precedent to the availability of the facility under the Loan Agreement.

IT IS AGREED as follows:

1	INTERPRETATION

1.1

Defined expressions

Words and expressions defined in the Loan Agreement shall have the same meanings when used in this Guarantee unless the context otherwise requires.

1.2

Construction of certain terms

In this Guarantee:

“ Apollo ” means the Fund and any Fund Affiliate.

Execution Version

“ Fund ” means Apollo Management VI, L.P. and other co-investment partnerships managed by Apollo Management VI, L.P.

“ Loan Agreement ” means the loan agreement dated July 2013 referred to in Recital (B) and includes any existing or future amendments or supplements, whether made with the Guarantor’s consent or otherwise.

“ Management ” means the employees of the Guarantor and its subsidiaries or their dependants or any trust for which such persons are the intended beneficiary.

1.3

Application of construction and interpretation provisions of Loan Agreement

Clauses 1.2 to 1.5 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 to the Security Trustee punctual performance by the Borrower of all the Borrower’s obligations under or in connection with the Loan Agreement and every other Finance Document;

(b)

undertakes to the Security Trustee that whenever the Borrower does not pay any amount when due under or in connection with the Loan Agreement and the other Finance Documents, the Guarantor shall immediately on demand pay that amount as if it was the principal obligor;

(c)

2.2

No limit on number of demands

The Security Trustee may serve any number of demands under Clause 2.1.

Execution Version

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

(a)	any time, waiver or consent granted to, or composition with, the Borrower or other person

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

(c)

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

(e)

(f)	any insolvency or similar proceedings;

(g)	any arrangement or concession (including a rescheduling or acceptance of partial payments) relating to, or affecting, the Finance Documents;

(h)	any release or loss whatsoever of any guarantee, right or Security Interest created by the Finance Documents;

(i)	any failure whatsoever 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

(j)	any other Finance Document 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

Execution Version

4.2

Fees and expenses payable under Loan Agreement

5	ADJUSTMENT OF TRANSACTIONS

5.1

Reinstatement of obligation to pay

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

6.3

Tax Credits

Execution Version

6.4

7	INTEREST

7.1

Accrual of interest

7.2

Calculation of interest

Interest on sums payable under this Guarantee shall be calculated and accrue in the same way as interest under clause 6 of the Loan Agreement.

7.3

Guarantee extends to interest payable under Loan Agreement

For the avoidance of doubt, it is confirmed that this Guarantee covers all interest payable under the Loan Agreement, including that payable under clause 17 of the Loan Agreement.

8	SUBORDINATION

8.1

Subordination of rights of Guarantor

(a)	claim, or in a bankruptcy of the Borrower or any other Obligor prove for, any amount payable to the Guarantor by the Borrower or any other Obligor, whether in respect of this Guarantee or any other transaction;

(b)	take or enforce any Security Interest for any such amount;

(c)	exercise any right to be indemnified by an Obligor;

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

(e)	claim to set-off any such amount against any amount payable by the Guarantor to the Borrower or any other Obligor; or

(f)	claim any subrogation or right of contribution or other right in respect of any Finance Document or any sum received or recovered by any Secured Party under a Finance Document.

Execution Version

9	ENFORCEMENT

9.1

No requirement to commence proceedings against Borrower

9.2

Conclusive evidence of certain matters

However, as against the Guarantor:

(a)	any judgment or order of a court in England or the Marshall Islands or the United States of America in connection with the Loan Agreement; and

(b)	any statement or admission of the Borrower in connection with the Loan Agreement,

shall be binding and conclusive as to all matters of fact and law to which it relates.

9.3

Suspense account

Until all amounts which may be or become payable by the Obligors under or in connection with the Finance Documents have been irrevocably paid in full, the Security Trustee and any Secured Party may:

(a)

refrain from applying or enforcing any other moneys, security or rights held or received by it (or any trustee or agent on its behalf which, in the case of a Secured Party, shall include the Agent and the Security Trustee) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and the Guarantor shall not be entitled to the benefit of the same; and

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

10	REPRESENTATIONS AND WARRANTIES

10.1

General

10.2

Status

The Guarantor is duly incorporated and validly existing and in good standing under the laws of Panama.

Execution Version

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 remain in force and nothing has occurred which makes any of them liable to revocation.

10.5

Legal validity

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; or

(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

10.8

No default

To the knowledge of the Guarantor, no Event of Default has occurred which is continuing.

10.9

Information

10.10

No litigation

Execution Version

10.11

No Security Interests

11	UNDERTAKINGS

11.1

General

11.2

Information provided to be accurate

11.3

Provision of financial statements

The Guarantor will send to the Security Trustee:

(a)	as soon as practicable, but in no event later than 120 days after the end of each financial year of the Guarantor beginning with the year ending 31 December 2013, the audited consolidated accounts of the Guarantor and its subsidiaries;

(b)	such projections (in such format as may be approved by the Security Trustee) as may be required under the terms of the proviso to Clause 11.15 (b) for the purposes of applying the Financial Covenants set out in Clause 11.15 at the end of the First Financial Quarter (as defined in Clause 11.16);

(c)	as soon as practicable (and in any event within ninety (90) days of the commencement of each financial year) the budgetary forecast (profit and loss statement, balance sheet statement and cash flow statement) of the Guarantor for the two following years;

(d)

(e)

a compliance certificate in the form set out in Schedule 1 to this Guarantee or in such other form as the Security Trustee may reasonably require (each a “ Compliance Certificate ” ) at the same time as there is delivered to the Security Trustee, and together with, each set of audited consolidated accounts under paragraph (a) and the set of unaudited consolidated accounts under paragraph (b) which constitute those for the First Financial Quarter, duly signed by the chief financial officer of the Guarantor and certifying whether or not the requirements of Clause 11.15 are then complied with; and

(f)	such additional financial or other relevant information regarding the Guarantor and the Group as the Security Trustee may reasonably request.

11.4

Form of financial statements

All accounts (audited and unaudited) delivered under Clause 11.3 will:

Execution Version

(a)	be prepared in accordance with GAAP;

(b)	when required to be audited, be audited by the auditors which are the Guarantor’s auditors at the date of this Guarantee or other auditors approved by the Security Trustee, provided that, such approval by the Security Trustee shall not be unreasonably withheld or delayed;

(c)	give a true and fair view of the state of affairs of the Guarantor and its subsidiaries at the date of those accounts and of their profit for the period to which those accounts relate; and

(d)	fully disclose or provide for all significant liabilities of the Guarantor and its subsidiaries.

11.5

Shareholder and creditor notices

11.6

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;

(b)	for the validity or enforceability of this Guarantee;

and the Guarantor will comply with the terms of all such consents.

11.7

Notification of litigation

11.8

Domicile and principal place of business

The Guarantor:

(a)	will maintain its domicile with the Resident Agent and at the address stated at the commencement of this Agreement or at such other Resident Agent and/or address in the Republic of Panama as is notified beforehand to the Security Trustee;

(b)

will maintain its principal place of business and keep its corporate documents and records in the United States of America at 8300 N.W. 33rd St., Suite 100, Miami, 33122, Florida (Fax: (305) 392 2582) or at such other address in the United States of America as is notified beforehand to the Security Trustee; and

(c)	will not move its domicile out of the Republic of Panama nor its principal place of business out of the United States of America without the prior agreement of the Security Trustee, acting with the authorisation of the Secured Parties, such agreement not to be unreasonably withheld.

Execution Version

11.9

Notification of default

11.10

Maintenance of status

The Guarantor will maintain its separate corporate existence and remain in good standing under the laws of Panama.

11.11

Negative pledge

The Guarantor shall not, and shall procure that neither Seven Seas nor the Borrower will, create or permit to arise any Security Interest over any asset present or future except Security Interests created or permitted by the Finance Documents and except for the following:

(a)	Security Interests created with the prior consent of the Security Trustee or otherwise permitted by the Finance Documents;

(b)	in the case of the Guarantor and Seven Seas, Security Interests which qualify as Permitted Security Interests with respect to the Guarantor or Seven Seas respectively;

(c)	in the case of the Borrower, Security Interests permitted under clause 12.5 of the Loan Agreement;

(d)

Security Interests provided in favour of lenders under and in connection with any refinancing of the Existing Indebtedness or any financing arrangements entered into by any member of the Group for the acquisition of additional or replacement ship(s) (including any refinancing of any such arrangement) but limited to:

(i)	pledges of the share capital of the relevant ship owning subsidiary(/ies); and/or

(ii)	ship mortgages and other securities over the financed ship(s).

11.12

No disposal of assets, change of business

The Guarantor will:

(a)

(b)

continue to be a holding company for a group of companies whose main business is the operation of cruise vessels as well as the marketing of cruises on board such vessels and the Guarantor will not change its main line of business so as to affect any Obligor’s ability to perform its obligations under the Finance Documents or to imperil, in the opinion of the Security Trustee, the security created by any of the Finance Documents or the SACE Insurance Policy.

11.13

No merger etc

The Guarantor shall not enter into any form of merger, sub-division, amalgamation, restructuring, consolidation, winding-up, dissolution or anything analogous thereto or acquire any entity, share capital or obligations of any corporation or other entity (each of the foregoing being a “ Transaction ”) unless:

Execution Version

(a)

the Guarantor has notified the Security Trustee in writing of the agreed terms of the relevant Transaction promptly after such terms have been agreed as heads of terms (or similar) and thereafter notified the Security Trustee in writing of any significant amendments to such terms during the course of the negotiation of the relevant Transaction; and

(b)	the relevant Transaction does not require or involve or result in any dissolution of the Guarantor so that at all times the Guarantor remains in existence; and

(c)	each notice delivered to the Security Trustee pursuant to paragraph (a) above is accompanied by a certificate signed by the Chief Financial Officer of the Guarantor whereby the Guarantor represents and warrants to the Security Trustee that the relevant Transaction will not:

(i)

adversely affect the ability of any Obligor to perform its obligations under the Finance Documents;

(ii)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; or

(iii)

affect the ability of the Guarantor to comply with the financial covenants contained in Clause 11.15.

11.14

Maintenance of ownership of Borrower and Guarantor.

(a)

The Guarantor shall remain the direct or indirect beneficial owner of the entire issued and allotted share capital of Seven Seas, free from any Security Interest and Seven Seas shall remain the legal holder and direct beneficial owner of all membership interest in the Borrower, free from any Security Interest, except that created in favour of the Security Trustee;

(b)

prior to any underwritten public offering of the equity interests of the Guarantor (or any direct or indirect parent of the Guarantor) which generates cash proceeds to Seven Seas of at least $ 150 million (a “ Qualified IPO ”), a combination of Apollo and Management (the “ Permitted Holders ”) shall at all times own beneficially (within the meaning of Rules 13d-3 and 13d-5 of The Securities Exchange Act of 1934 (15 USC §78a et seq.) (the “ Exchange Act ”) as in effect on the Delivery Date) directly or indirectly, in the aggregate, equity interests representing at least a majority of the aggregate ordinary voting power represented by the issued and outstanding equity interests of the Guarantor; or

(c)

11.15

Financial Covenants

The Guarantor shall ensure that for each relevant Financial Year starting with the Financial Year ending on 31 December 2013 and thereafter at the end of each Financial Year and also at the end of the First Financial Quarter by reference to the accounts delivered under Clause 11.3:

(a)	the ratio of Total Debt to EBITDA for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2; and

Execution Version

(b)	the ratio of Total Debt to Total Adjusted Equity for the Group for the relevant Financial Year shall not exceed the level provided for, for that Financial Year, in Schedule 2;

(c)	the ratio of EBITDA to Debt Service for the Group for the relevant Financial Year shall not be less than the level provided for, for that Financial Year, in Schedule 2;

provided that the “relevant Financial Year” shall mean, at the end of the First Financial Quarter, the Financial Year of which that First Financial Quarter forms part and, to the extent that there remain financial quarters still to come, in such Financial Year, the relevant numbers for calculation of the Financial Covenants at such time shall be made up of unaudited consolidated accounts for those quarters that have already taken place and of projected consolidated accounts for any quarter(s) still to come, such projections to be prepared by the Guarantor in such form and on such basis as may be reasonably acceptable to the Security Trustee, including being consistent with the approach adopted in the quarters that have taken place already.

11.16

Financial definitions

For the purposes of Clause 11.15:

(a)	“ Cash Balance ” means, at the date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Group;

(b)	“ Cash Brought Forward ” means, for any relevant period, the Cash Balance as at the start of that period less $35,000,000;

(c)	“ Debt Service ” means, for any relevant period, the sum (without double counting), determined in accordance with GAAP, of:

(i)

the aggregate principal payable or paid during such period on any Indebtedness of any member of the Group, other than:

(A)

principal of such Indebtedness prepaid at the option of the relevant member of the Group;

(B)

principal of any such Indebtedness prepaid upon the sale or Total Loss of any ship owned or leased under a capital lease by any member of the Group;

(C)

any excess cash flow-based repayment,

(ii)

Interest Expense for such period; and

(iii)

(d)	“ EBITDA ” means, for any relevant period, the aggregate of:

(i)

Net Income from the Group’s operations for such period; and

(ii)

Execution Version

period, impairment charges and any other non-cash charges and non-recurring charges for such period;

less

(iii)

gains from the sale of assets and any non-cash profits;

(e)	“ Financial Year ” means any financial year of the Group ending on 31 December;

(f)	“ First Financial Quarter ” means the financial quarter ending immediately prior to or on the date falling 90 days before the Intended Delivery Date;

(g)	“ Indebtedness ” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:

(i)

moneys borrowed or raised;

(ii)

the advance or extension of credit (including interest and other charges on or in respect of the foregoing);

(iii)

the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;

(iv)

the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

(v)

all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and

(vi)

(without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;

PROVIDED THAT the following shall not constitute Indebtedness:

(A)

loans and advances made by members of the Group to other members of the Group which are subordinated to the rights of the Secured Parties; and

(B)

any liabilities of the Guarantor or any other member of the Group to a counterparty under any master agreement relating to the interest or currency exchange of a non-speculative nature;

(h)	“ Interest Expense ” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Group for such period;

(i)	“ Net Income ” means, for any relevant period, the consolidated net income (or loss) of the Group for such period as determined in accordance with GAAP;

(j)	“ Total Debt ” means, as at any relevant date, Indebtedness of the Group;

(k)	“ Total Adjusted Equity ” means, at any date of determination, Total Equity at such date, as adjusted to exclude the direct or indirect impact of any hedging or similar arrangements on the consolidated stockholders’ equity of the Group as at such date as required under GAAP; and

(l)	“ Total Equity ” means, at any date of determination, the consolidated stockholders’ equity of the Group at such date determined in accordance with GAAP.

Execution Version

11.17

Negative Undertakings

The Guarantor shall:

(a)

not at any time after the end of the First Financial Quarter, declare or pay dividends or make other distributions or payment in respect of Financial Indebtedness owed to its shareholders without the prior written consent of the Security Trustee, provided that the Guarantor may declare and pay dividends to its shareholders after the Delivery Date or make any other distributions or payments in respect of Financial Indebtedness owed to its shareholders subject to it on each such occasion satisfying the Security Trustee acting on behalf of the Secured Parties that it will continue to meet all the requirements of Clause 11.15, if such covenants were to be tested immediately following the payment of any such dividend;

(b)	not, and shall procure that none of its subsidiaries shall:

(i)

make loans to any person that is not the Guarantor or a direct or indirect subsidiary of the Guarantor; or

(ii)

issue or enter into one or more guarantees covering the obligations of any person which is not the Guarantor or a direct or indirect subsidiary of the Guarantor,

except if such loan is granted to a non subsidiary or such guarantee is issued in the ordinary course of business covering the obligations of a non subsidiary and the aggregate amount of all such loans and guarantees made or issued by the Guarantor and its subsidiaries does not exceed USD25,000,000 or is otherwise approved by the Security Trustee which approval shall not be unreasonably withheld if such loan or guarantee in respect of a non subsidiary would neither:

(A)

affect the ability of any Obligor to perform its obligations under the Finance Documents; nor

(B)

imperil the security created by any of the Finance Documents or the SACE Insurance Policy; nor

(C)

affect the ability of the Guarantor to comply with the financial covenants contained in Clause 11.15 if such covenants were to be tested immediately following the grant of such loan or the issuance of such guarantee, as demonstrated by evidence satisfactory to the Security Trustee.

12	Judgments and Currency Indemnity

12.1

Judgments relating to Loan Agreement

This Guarantee shall cover any amount payable by the Borrower under or in connection with any judgment relating to the Loan 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 Secured Party may without prior notice:

Execution Version

(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 Secured Party in or towards satisfaction of any sum then due from the Guarantor to that Secured 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;

(iii)

enter into any other transaction or make any entry with regard to the credit balance which the Secured Party concerned considers appropriate.

13.2

Existing rights unaffected

13.3

Sums deemed due to a Lender

14	SUPPLEMENTAL

14.1

Continuing guarantee

This Guarantee shall remain in force as a continuing security at all times during the Security Period, regardless of any intermediate payment or discharge in whole or in part.

14.2

Rights cumulative, non-exclusive

14.3

No impairment of rights under Guarantee

14.4

Severability of provisions

14.5

Guarantee not affected by other security

This Guarantee is in addition to and 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

Execution Version

which the Security Trustee or any Secured Party may now or later hold in connection with the Loan Agreement.

Guarantor bound by Loan Agreement

14.6

Applicability of provisions of Guarantee to other Security Interests

14.7

Applicability of provisions of Guarantee to other rights

Clauses 3 and 17 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 and 17), being an agreement referring to this Guarantee.

14.8

Third party rights

14.9

Waiver of rights against SACE

15	ASSIGNMENT AND TRANSFER

15.1

Assignment and transfer by Security Trustee

The Security Trustee may assign or transfer its rights under and in connection with this Guarantee to the same extent as it may assign or transfer its rights under the Loan Agreement.

The Guarantor may not assign or transfer its rights under and in connection with this Guarantee.

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:

Prestige Cruise Holdings Inc.

8300 N.W. 33rd St, Suite 100

Execution Version

Miami

Florida, 33122

Fax: (305) 392-2582

or to such other address which the Guarantor may notify to the Security Trustee.

16.2

Application of certain provisions of Loan Agreement

Clauses 30.3 to 30.8 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 Borrower under the Loan Agreement;

(b)	at the same time as the service of a notice under clause 18.21 (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 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

17.1

Invalidity of Loan Agreement

In the event of:

(a)	the Loan Agreement or any provision thereof now being or later becoming, with immediate or retrospective effect, void, illegal, unenforceable or otherwise invalid for any reason whatsoever; or

(b)	without limiting the scope of paragraph (a), a bankruptcy of the Borrower, the introduction of any law or any other matter resulting in the 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 Borrower had not suffered bankruptcy, or any combination of such events or circumstances, as the case may be, and the Borrower 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 Borrower 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 Finance Documents

Clause 17.1 also applies to each of the other Finance Documents to which the Borrower is a party.

Execution Version

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, the courts of England shall have exclusive jurisdiction to settle any Dispute.

18.3

Choice of forum for the exclusive benefit of the Security Trustee

Clause 18.2 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 Dispute; and

(b)	to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.

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 EC3 Services Limited at its registered office for the time being, presently at The St Botolph Building, 138 Houndsditch, London, EC3A 7AR, United Kingdom, 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 a Dispute.

18.5

Secured Parties’ rights unaffected

18.6

Meaning of “proceedings”

In this Clause 18, “ 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.

Execution Version

Execution Page


GUARANTOR

SIGNED by Paul Turner		) /s/ Paul Turner
for and on behalf of		)
PRESTIGE CRUISE HOLDINGS		)
INC.		)
as its duly appointed attorney-in-fact		)
in the presence of: Jessica Greenwood		)


SECURITY TRUSTEE

SIGNED by Jerome Leblond		) /s/ Jerome Leblond
for and on behalf of		)
CRÉDIT AGRICOLE CORPORATE		)
AND INVESTMENT BANK		)
as its duly appointed attorney-in-fact		)
in the presence of: Jessica Greenwood		)

Execution Version

SCHEDULE 1

FORM OF COMPLIANCE CERTIFICATE


To:		CRÉDIT AGRICOLE CORPORATE
		AND INVESTMENT BANK
		9 Quai du Président Paul Doumer
		92920 Paris La Défense Cedex
		France

Attn: [ — ]

[ — ] 20[ — ]

Dear Sirs

Loan Agreement dated [ — ] 2013 (the “Loan Agreement”) made between (1) Explorer New Build, LLC (the “Borrower”), (2) the banks and financial institutions named at schedule 1 therein as lenders, (3) Credit Agricole Corporate and Investment Bank, Société Générale, HSBC Bank plc and KFW IPEX Bank Gmbh as Joint Mandated Lead Arrangers, (4) Credit Agricole Corporate and Investment Bank as Agent and SACE Agent and (5) Credit Agricole Corporate and Investment Bank as Security Trustee for a loan facility of up to the aggregate of the Dollar Equivalent of EUR299,866,962 and Guarantee dated [ — ] 2013 (the “Guarantee”) made between (1) us as guarantor and (2) Credit Agricole Corporate and Investment Bank as Security Trustee

We refer to the Loan Agreement and the Guarantee. Terms defined in the Loan Agreement and the Guarantee have their defined meanings when used in this Compliance Certificate.

We also refer to the financial covenants set out in Clause 11.15 of the Guarantee.

We certify that, as at the date of this Compliance Certificate, in relation to such covenants and by reference to the latest accounts provided under Clause 11.3[(a)/(b)] of the Guarantee:

(a)	the ratio of Total Debt to EBITDA is [ — ] and therefore [does/does not] exceed [insert relevant maximum];

(b)	the ratio of Total Debt to Total Adjusted Equity is [ — ] and therefore [does/does not] exceed [insert relevant maximum].

(c)	the ratio of EBITDA to Debt Service is [ — ] and therefore [is/is not] less than [insert relevant minimum];

To evidence compliance with the terms of Clause 11.15, we attach:

[a copy of the latest annual consolidated accounts of the Group as Appendix A;] or

No Event of Default has occurred in relation to the Borrower or the Guarantor.


Signed:

Chief Financial Officer of

Prestige Cruise Holdings Inc.

Execution Version

SCHEDULE 2

FINANCIAL COVENANT LEVELS


Financial Year	EBITDA/ Debt Service	Total Debt/EBITDA	Total Debt/ Total Adjusted Equity

2013	1.20x	7.70x	4.50x

2014	1.20x	7.00x	3.00x

2015	1.20x	6.50x	2.50x

2016	1.20x	6.50x	2.50x

2017	1.25x	5.75x	2.50x

2018	1.30x	5.00x	2.50x

2019	1.30x	4.50x	2.50x

2020	1.30x	4.00x	2.50x

2021	1.30x	4.00x	2.50x

2022	1.30x	4.00x	2.50x

2023	1.30x	4.00x	2.50x

2024	1.30x	4.00x	2.50x

2025	1.30x	4.00x	2.50x

2026	1.30x	4.00x	2.50x

2027	1.30x	4.00x	2.50x

2028	1.30x	4.00x	2.50x

Exhibit 10.24

FORM OF STOCK OPTIONS AGREEMENT OF

PRESTIGE CRUISES INTERNATIONAL, INC.

THIS AGREEMENT (this “ Agreement ”), dated as of , 2008 (the “ Option Date’ ’) is made by and among Prestige Cruises International, Inc., a corporation organized under the laws of the Republic of Panama (the “ Company’’ ), and (the “ Optionee ”).

WHEREAS , the Company wishes to afford the Optionee the opportunity to purchase shares of its common stock, par value $0.01 per share (“ Common Stock ”);

NOW, THEREFORE , in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows:

For the purposes of this Stock Options Agreement, the following terms have the meaning set forth below:

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, supplemented or restated from time to time and any successor to such statute, and the rules and regulations promulgated thereunder.

“ Exercise Price ” shall mean the amounts payable for exercise of the Options as set forth in Section 1.1 .

“ Options ” shall mean the options to purchase any part or all of shares of Common Stock.

“ Qualified Public Offering ” shall have the meaning set forth in the Stockholders’ Agreement.

“ Sale of the Company ’’ shall have the meaning set forth in the Stockholders’ Agreement.

“ Securities Act ” means the U.S. Securities Act of 1933, as amended, supplemented or restated from time to time and any successor to such statute, and the rules and regulations promulgated thereunder.

“ Stockholders’ Agreement ” shall mean the Stockholders’ Agreement dated as of the date hereof, by and among the Optionee, the Company and the other stockholders of the Company.

ARTICLE I

GRANT OF OPTIONS

Section 1.1 Grant of Options

ARTICLE II

EXERCISABILITY AND EXPIRATION

Section 2.1 Commencement of Exercisability

The shares of Common Stock covered by the Options shall become exercisable immediately and remain exercisable until the expiration set forth in Section 2.2 .

Section 2.2 Expiration

The Options (if not already exercised) shall expire immediately following the earlier of:

(a)

a Qualified Public Offering;

(b)

a Sale of the Company; or

(c)

the tenth Anniversary of the Option Date.

Section 2.3 Partial Exercise

Section 2.4 Method of Exercise of Options

The Options shall be exercisable by the delivery to the General Counsel of the Company of:

(a) a form of written notice from the Optionee stating the number of shares of Common Stock to be purchased pursuant to the Options; and

(b) payment in full for the Exercise Price of the shares to be purchased, in cash or by electronic funds transfer to the Company or such other specific provisions or directions as the Company and Optionee may agree.

Section 2.5 Changes In Common Stock

Upon (or, as may be necessary to effect the adjustment, immediately prior to) (i) any reclassification, recapitalization, stock split (including a stock split in the form of a stock dividend) or reverse .stock split; (ii) any merger, combination, consolidation, or other reorganization, (iii) any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock; or (iv) any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock, then the Company shall equitably and proportionately adjust (1) the number and type of shares of Common Stock (or other securities) that thereafter may be made the subject of the Options, (2) the number, amount and type of shares of Common Stock (or other securities or property) subject to any of the outstanding Options, (3) the exercise price of any of the outstanding Options, and/or (4) the securities, cash or other property deliverable upon exercise of any of the outstanding Options, in each case to the extent necessary to preserve the economic terms of the Options.

It is intended that, if possible, any adjustments contemplated by this Section 2.5 be made fu a manner that satisfies applicable legal, tax and accounting (so as to not trigger any charge to earnings with respect to such adjustment) requirements. Unless otherwise expressly provided, in no event shall any new issuance of securities by the Company for consideration be deemed, in and of itself, to require an adjustment pursuant to this Section 2.5 .

ARTICLE III

OTHER PROVISIONS

Section 3.1 Shares Subject to Stockholder Agreement

The Optionee acknowledges that any shares of Common Stock acquired upon exercise of the Options are subject to the terms of the Stockholders’ Agreement.

Section 3.2 Transferability

The Options shall be fully transferable, provided always that any transfer shall be made in accordance with the terms of the Stockholders’ Agreement, including, but not limited to, the requirements of Section 13 (g) thereunder.

Section 3.3 Amendment and Modification

Each of the Company and the Optionee agrees that no change, waiver, modification or amendment of this Agreement shall be effective without the prior written approval of the Company and the Optionee; provided , that any modification or waiver of this Agreement in a manner materially adverse to the interests of the Non-Apollo Holders (as defined in the Stockholders’ Agreement), in their capacity as holders of Common Stock, shall require the consent of the holders of a majority of all the then-outstanding shares of Common Stock of the Company then held by the Non-Apollo Holders.

Section 3.4 Governing Law

THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PROVISIONS THAT WOULD GIVE EFFECT TO THE LAWS OF ANOTHER JURISDICTION.

Section 3.5 Conformity to Securities Laws

Notwithstanding anything herein to the contrary, the Options are granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.

Section 3.6 Entire Agreement

The parties hereto acknowledge that this Agreement and the Stockholders’ Agreement set forth the entire agreement and understanding of the parties and supersede all prior written or oral agreements or understandings with respect to the subject matter hereof, except that any provisions therein regarding confidentiality or non-competition remain in full force and effect in favor of the Company and its subsidiaries as if the agreements containing such provisions were not so superseded.

The obligations imposed by this Agreement are severable and should be construed independently of each other. The invalidity of one provision shall not affect the validity of any other provision. If any provision of this Agreement shall be invalid or unenforceable, in whole or in part, or as applied to any circumstances, under the laws of any jurisdiction which may govern for such purpose, then such provision shall be deemed, to the extent allowed by the laws of such jurisdiction, to be modified or restricted to the extent and in the manner necessary to render the same valid and enforceable, either generally or as applied to such circumstance, or shall be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision had been originally incorporated herein as so modified or restricted, or as if such provision had not been originally incorporated herein, as the case may be.

Section 3.7 Waiver of Jury Trial

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM: ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 3.8 Notices

All notices, requests, consents and other communications hereunder to any party hereto shall be deemed to be sufficient if contained in a written instrument and shall be deemed to have been duly given when delivered in person, by telecopy, by nationally-recognized overnight courier, or by first class registered or certified mail, postage prepaid, addressed to such party at the address set forth below or such other address as may hereafter be designated in writing by the addressee to the addressor:

(i) if to the Company:

Prestige Cruises International, Inc.

8300 N.W. 33 ^rd Street, Suite 308

Miami, Florida 33122

Attention: Frank J. Del Rio

Attention: Gema M. Pifion

and

Prestige Cruises International, Inc.

c/o Apollo Management, L.P.

9 West 57th Street, 43rd Floor

New York, NY 10019

Fax: (212) 515-3288

Attention: Steven Martinez

and

O’Melveny & Myers LLP

Times Square Tower

7 Times Square

New York, NY 10036

Fax: (212) 326-2061

Attention: Douglas A. Ryder, Esq.

(ii) if to the Optionee:

Section 3.9 Counterparts

This Agreement may be executed in several counterparts, including via facsimile transmission, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.

*****

IN WITNESS WHEREOF , this Agreement has been executed and delivered by the parties hereto as of the day, month and year first set forth above.


THE COMPANY:

PRESTIGE CRUISES INTERNATIONAL, INC.

By:
Name:
Title:

THE OPTIONEE:



By:
Name:
Title:

(Option Agreement)

Exhibit 10.25

FORM OF STOCK OPTIONS AGREEMENT OF

PRESTIGE CRUISES INTERNATIONAL, INC.

THIS AGREEMENT (this “ Agreement ”), dated as of , 2008 (the “ Option Date” ) is made by and among Prestige Cruises International, Inc., a corporation organized under the laws of the Republic of Panama (the “ Company” ), and (the “ Optionee ”).

WHEREAS, the Company wishes to afford the Optionee the opportunity to purchase shares of its common stock, par value $0.01 per share (“ Common Stock ”);

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows:

For the purposes of this Stock Options Agreement, the following terms have the meaning set forth below:

“ Base Amount ” shall mean .

“ Base Amount Options ” shall mean the options to purchase any part or all of the aggregate of the Base Amount of shares of Common Stock.

“ Exercise Price” shall mean the amounts payable for exercise of the Options as set forth in Section 1.1.

“ Options ” shall mean the Base Amount Options and PIK Dividend Options.

“ PIK Dividend Amount ” shall mean, as of any date of determination, a number calculated by the following calculation: (i) the amount that arises, if, from April 27, 2007 to the date of determination an effective interest rate of five percent (5.00%) per annum was applied to the Base Amount (such effective interest rate to be cumulative and shall compound semi annually) and such amount is added to the Base Amount minus (ii) the Base Amount.

“ PIK Dividend Options ” shall mean, as of any date of determination, the options to purchase that PIK Dividend Amount of shares of Common Stock.

“ Qualified Public Offering ” shall have the meaning set forth in the Stockholders’ Agreement.

“ Sale of the Company ” shall have the meaning set forth in the Stockholders’ Agreement.

“ Stockholders’ Agreement ” shall mean the Stockholders’ Agreement dated as of the date hereof, by and among the Optionee, the Company and the other stockholders of the Company.

ARTICLE I

GRANT OF OPTIONS

Section 1.1 Grant of Options

On the date hereof the Company irrevocably grants to the Optionee, the Options, upon the terms and conditions set forth in this Agreement. The purchase price of the shares of Common Stock covered by the Base Amount Options shall be $40.02355 per share (without commission or other charge). The purchase price of the shares of Common Stock covered by the PIK Dividend Options shall be $40.02355 per share (without commission or other charge.)

ARTICLE II

EXERCISABILITY AND EXPIRATION

Section 2.1 Commencement of Exercisability

The shares of Common Stock covered by the Options shall become exercisable immediately and remain exercisable until the expiration set forth in Section 2.2.

Section 2.2 Expiration

The Options (if not already exercised) shall expire immediately following the earlier of:

(a)

a Qualified Public Offering;

(b)

a Sale of the Company; or

(c)

the tenth Anniversary of the Option Date.

Section 2.3 Partial Exercise

The Options may be exercised in whole or in part at any time prior to the time when the Options or portion thereof expire; provided , however, that each partial exercise shall be for not less than 100 shares of Common Stock and shall be for whole shares of Common Stock only. Following any partial exercise, the Base Amount, for the purposes of calculating any subsequent PIK Dividend Options shall be reduced by an amount equal to the number of Base Amount Options so exercised.

Section 2.4 Method of Exercise of Options

The Options shall be exercisable by the delivery to the General Counsel of the Company of:

(a) a form of written notice from the Optionee stating the number of shares of Common Stock to be purchased pursuant to the Options; and

Section 2.5 Changes In Common Stock

Upon (or, as may be necessary to effect the adjustment, immediately prior to) (i) any reclassification, recapitalization, stock split (including a stock split in the form of a stock dividend) or reverse stock split; (ii) any merger, combination, consolidation, or other reorganization, (iii) any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock; or (iv) any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock, then the Company shall equitably and proportionately adjust (1) the number and type of shares of Common Stock (or other securities) that thereafter may be made the subject of the Options, (2) the number, amount and type of shares of Common Stock (or other securities or property) subject to any of the outstanding Options, (3) the exercise price of any of the outstanding Options, and/or (4) the securities, cash or other property deliverable upon exercise of any of the outstanding Options, in each case to the extent necessary to preserve the economic terms of the Options.

It is intended that, if possible, any adjustments contemplated by this Section 2.5 be made in a manner that satisfies applicable legal, tax and accounting (so as to not trigger any charge to earnings with respect to such adjustment) requirements. Unless otherwise expressly provided, in no event shall any new issuance of securities by the Company for consideration be deemed, in and of itself, to require an adjustment pursuant to this Section 2.5 .

ARTICLE III

OTHER PROVISIONS

Section 3.1 Shares Subject to Stockholder Agreement

The Optionee acknowledges that any shares of Common Stock acquired upon exercise of the Options are subject to the terms of the Stockholders’ Agreement.

Section 3.2 Transferability

Section 3.3 Amendment and Modification

Stockholders’ Agreement), in their capacity as holders of Common Stock, shall require the consent of the holders of a majority of all the then-outstanding shares of Common Stock of the Company then held by the Non-Apollo Holders.

Section 3.4 Governing Law

Section 3.5 Conformity to Securities Laws

The Optionee acknowledges that the grant of Options is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission. Notwithstanding anything herein to the contrary, the Options is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.

Section 3.6 Entire Agreement

Section 3.7 Waiver of Jury Trial

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 3.8 Notices

(i) if to the Company:

Prestige Cruises International, Inc.

8300 N.W. 33rd Street, Suite 308

Miami, Florida 33122

Attention: Frank J. Del Rio

Attention: Gema M. Pinon

and

Prestige Cruises International, Inc.

c/o Apollo Management, L.P.

9 West 57th Street, 43 ^rd Floor

New York, NY 10019

Fax: (212) 515-3288

Attention: Steven Martinez

and

O’Melveny & Myers

LLP Times Square Tower

7 Times Square

New York, NY 10036

Fax: (212) 326-2061

Attention: Douglas A. Ryder, Esq.

(ii) if to the Optionee:

Section 3.9 Counterparts

* * * * *

IN WITNESS WHEREOF , this Agreement has been executed and delivered by the parties hereto as of the day, month and year first set forth above.


THE COMPANY:

PRESTIGE CRUISES INTERNATIONAL, INC.

By:
Name:
Title:

THE OPTIONEE:



By:
Name:
Title:

[Option Agreement]

Exhibit 10.26

FORM OF STOCK OPTIONS AGREEMENT OF

PRESTIGE CRUISES INTERNATIONAL, INC.

WHEREAS , the Company wishes to afford the Optionee the opportunity to purchase shares of its common stock, par value $0.01 per share (“ Common Stock ”);

For the purposes of this Stock Options Agreement, the following terms have the meaning set forth below:

“ Base Amount ” shall mean .

“ Base Amount Options ” shall mean the options to purchase any part or all of the aggregate of the Base Amount of shares of Common Stock.

“ Exercise Price ” shall mean the amounts payable for exercise of the Options as set forth in Section 1.1.

“ Options ” shall mean the Base Amount Options and PIK Dividend Options.

“ PIK Dividend Amount ” shall mean, as of any date of determination, a number calculated by the following calculation: (i) the amount that arises, if, from June 19, 2007 to the date of determination an effective interest rate of five percent (5.00%) per annum was applied to the Base Amount (such effective interest rate to be cumulative and shall compound semi annually) and such amount is added to the Base Amount minus (ii) the Base Amount.

“ PIK Dividend Options ” shall mean, as of any date of determination, the options to purchase that PIK Dividend Amount of shares of Common Stock.

“ Qualified Public Offering ” shall have the meaning set forth in the Stockholders’ Agreement.

“ Sale of the Company ” shall have the meaning set forth in the Stockholders’ Agreement.

“ Stockholders’ Agreement ” shall mean the Stockholders’ Agreement dated as of the date hereof, by and among the Optionee, the Company and the other stockholders of the Company.

ARTICLE I

GRANT OF OPTIONS

Section 1.1 Grant of Options

ARTICLE II

EXERCISABILITY AND EXPIRATION

Section 2.1 Commencement of Exercisability

The shares of Common Stock covered by the Options shall become exercisable immediately and remain exercisable until the expiration set forth in Section 2.2.

Section 2.2 Expiration

The Options (if not already exercised) shall expire immediately following the earlier of:

(a)

a Qualified Public Offering;

(b)

a Sale of the Company; or

(c)

the tenth Anniversary of the Option Date.

Section 2.3 Partial Exercise

The Options may be exercised in whole or in part at any time prior to the time when the Options or portion thereof expire; provided, however, that each partial exercise shall be for not less than 100 shares of Common Stock and shall be for whole shares of Common Stock only. Following any partial exercise, the Base Amount, for the purposes of calculating any subsequent PIK Dividend Options shall be reduced by an amount equal to the number of Base Amount Options so exercised.

Section 2.4 Method of Exercise of Options

The Options shall be exercisable by the delivery to the General Counsel of the Company of:

(a) a form of written notice from the Optionee stating the number of shares of Common Stock to be purchased pursuant to the Options; and

Section 2.5 Changes In Common Stock

Upon (or, as may be necessary to effect the adjustment, immediately prior to) (i) any reclassification, recapitalization, stock split (including a stock split in the form of a stock dividend) or reverse stock split; (ii) any merger, combination, consolidation, or other reorganization, (iii) any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock; or (iv) any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock, then the Company shall equitably and proportionately adjust (1) the number and type of shares of Common Stock (or other securities) that thereafter may be made the subject of the Options, (2) the number, amount and type of shares of Common Stock (or other securities or property) subject to any of the outstanding Options, (3) the exercise price of any of the outstanding Options, and/or (4) the securities, cash or other property deliverable upon exercise of any of the outstanding Options, in each case to the extent necessary to preserve the economic terms of the Options.

ARTICLE III

OTHER PROVISIONS

Section 3.1 Shares Subject to Stockholder Agreement

The Optionee acknowledges that any shares of Common Stock acquired upon exercise of the Options are subject to the terms of the Stockholders’ Agreement.

Section3.2 Transferability

Section 3.3 Amendment and Modification

Section 3.4 Governing Law

Section 3.5 Conformity to Securities Laws

Section 3.6 Entire Agreement

Section 3.7 Waiver of Jury Trial

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 3.8 Notices

All notices, requests, consents and other communications hereunder to any party hereto shall be deemed to be sufficient if contained in a written instrument and shall be deemed to have been duly given when delivered in person, by telecopy, by nationally recognized overnight courier, or by first class registered or certified mail, postage prepaid, addressed to such party at the address set forth below or such other address as may hereafter be designated in writing by the addressee to the addressor:

(i) if to the Company:

Prestige Cruises International, Inc.

8300 N.W. 33rd Street, Suite 308

Miami, Florida 33122

Attention: Frank J. Del Rio

Attention: Gema M. Pinon

and

Prestige Cruises International, Inc.

c/o Apollo Management, L.P.

9 West 57 ^th Street, 43rd Floor

New York, NY 10019

Fax: (212) 515-3288

Attention: Steven Martinez

and

O’Melveny & Myers LLP

Times Square Tower

7 Times Square

New York, NY 10036

Fax: (212) 326-2061

Attention: Douglas A. Ryder, Esq.

(ii) if to the Optionee:

Section 3.9 Counterparts

IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto as of the day, month and year first set forth above.


THE COMPANY:

PRESTIGE CRUISES INTERNATIONAL, INC.

By:
Name:
Title:

THE OPTIONEE:



By:
Name:
Title:

{Option Agreement]

Exhibit 21.1

Subsidiaries of Prestige Cruises International, Inc.


Name of Subsidiary		Jurisdiction of Incorporation of Organization

Celtic Pacific (UK) Limited		England and Wales

Celtic Pacific (UK) Two Limited		Bahamas

Classic Cruises, LLC		Delaware

Classic Cruises II, LLC		Delaware

Explorer New Build LLC		Delaware

Insignia Vessel Acquisition, LLC		Delaware

Marina New Build LLC		Republic of the Marshall Islands

Mariner LLC		Republic of the Marshall Islands

Nautica Acquisition, LLC		Delaware

Navigator Vessel Company LLC		Delaware

Oceania Cruises, Inc.		Panama

Oceania Cruises Ireland, Ltd.		Ireland

OCI Finance Corp.		Delaware

Oceania Vessel Finance, Ltd.		Cayman Islands

Prestige Cruises Air Services, Inc.		Florida

Prestige Cruise Services, LLC		Florida

Prestige Cruise Services (Europe) Limited		England and Wales

Prestige Cruise Holdings, Inc.		Panama

Regatta Acquisition, LLC		Delaware

Riviera New Build LLC		Republic of the Marshall Islands

Seven Seas Cruises S. DE R.L.		Panama

SSC Finance Corp.		Delaware

Supplystill Limited		England and Wales

Voyager Vessel Company LLC		Delaware

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

We hereby consent to the use in this Registration Statement on Form S-1 of Prestige Cruises International, Inc., of our report dated March 24, 2014 relating to the financial statements and financial statements schedules of Prestige Cruises International, Inc., which appears in such Registration Statement. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

/s/PricewaterhouseCoopers LLP

Miami, Florida

March 24, 2014