UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
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___________________
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FORM
6-K
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___________________
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REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16
UNDER
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report: June 9, 2006
Commission
File Number 1-32591
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SEASPAN
CORPORATION
(Exact
name of Registrant as specified in its Charter)
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Unit
2, 7th
Floor, Bupa Centre
141
Connaught Road West
Hong
Kong
China
(Address
of principal executive offices)
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______________
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[Indicate
by check mark whether the registrant files or will file annual reports
under
cover of Form 20-F or Form 40-F.]
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Form
20-F
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__ X __ |
Form
40-F
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[Indicate
by check mark if the registrant is submitting the Form 6-K in paper as
permitted
by Regulation S-I Rule 101 (b)(1).]
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Yes
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______
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No
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__ X __ |
[Indicate
by check mark if the registrant is submitting the Form 6-K in paper as
permitted
by Regulation S-T Rule 101 (b)(7).]
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Yes
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______
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No
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__ X __ |
[Indicate
by check mark whether the registrant by furnishing the information contained
in
this Form is also thereby furnishing the information to the Commission
pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.]
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Yes
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______
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No
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__ X __ |
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .
Item
1 - Information Contained in this Form 6-K Report
On
May
19, 2006, Seaspan Corporation entered into a 10 to 13-year (based
on the
delivery dates of certain vessels), senior secured, $365 million
revolving
credit facility with DnB Nor Bank ASA, Credit Suisse and Fortis
Capital Corp.,
as Mandated Lead Arrangers, DNB Nor Bank ASA, as Sole Bookrunner,
Administrative
Agent and Security Agent, Landesbank Hessen-Thuringen, as Documentation
Agent
and the various lenders party thereto.
The
facility is split into two separate tranches. Our obligations under
the facility
are secured by first-priority mortgages on two 3,500 TEU container
vessels, in
the case of the first tranche, and up to eight 2,500 TEU container
vessels, in
the case of the second tranche. Also, the facility is secured by
a
first-priority assignment of our earnings related to the collateral
vessels,
including time-charter revenues and any insurance proceeds.
We
may
prepay all loans at any time without penalty, other than breakage
costs in
certain circumstances. Amounts that have been prepaid, may be reborrowed.
We are
required to prepay a portion of the outstanding loans under certain
circumstances, including the sale or loss of a vessel if we do
not substitute
another vessel. Beginning six months from the delivery date of
the last vessel
securing the first tranche of the facility, but no later than March
31, 2008,
the total amounts available for borrowing under the first tranche
will be
reduced semiannually until the maturity date, at which time the
facility will
terminate. Beginning six months from the delivery date of the last
vessel
securing the second tranche of the facility, but no later than
April 30, 2010,
the total amounts available for borrowing under the second tranche
will be
reduced semiannually until the maturity date, at which time the
facility will
terminate.
Indebtedness
under the revolving credit facility bears interest at a rate equal
to LIBOR +
0.850% until approximately July 31, 2013, for the first tranche,
and
approximately August 31, 2005, for the second tranche, and LIBOR
+ 0.925%
thereafter. We incur a commitment fee on the unused portion of
the revolving
credit facility at a rate of 0.30% per annum.
We
are
subject to other customary conditions precedent before we may borrow
under the
facility, including that no event of default is ongoing and there
having
occurred no material adverse effect on our ability to perform our
payment
obligations under the facility. In addition, the credit facility
contains
various covenants limiting our ability to:
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Allow
liens to be placed on the collateral securing the
facility;
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Enter
into mergers with other entities;
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Conduct
material transactions with our affiliates except on an
arm’s-length
basis;
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Change
the flag, class, or management of our
vessels.
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The
credit agreement also contains covenants requiring us to maintain:
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A
tangible net worth (as defined in the credit agreement)
of
$450,000,000;
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Total
borrowings less than 65% of total assets (each as defined
in the credit
agreement);
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Cash
on hand of $25,000,000 if at any time more than 50% of
the collateral
vessels are subject to time charters having a remaining
term of one year
or less;
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A
net interest coverage ratio (as defined in the credit
agreement) of 2.50
to 1.00; and
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An
interest and principal coverage ratio (as defined in
the credit agreement)
of 1.1 to 1.0.
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The
credit agreement contains customary definitions of events of default,
including
nonpayment of principal or interest, breach of covenants or material
inaccuracy
of representations, default under other material indebtedness,
bankruptcy, and
change of control.
The
description of the credit facility is qualified in its entirety
by reference to
the agreement itself, which is incorporated by reference herein
and included as
Exhibit 1 hereto.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has
duly caused this report to be signed on its behalf by the undersigned,
thereunto
duly authorized.
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SEASPAN
CORPORATION
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By:
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/s/
Kevin M. Kennedy
___________________
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Date: June
9, 2006
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Kevin
M. Kennedy
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Chief
Financial Officer
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EXHIBIT
1
CREDIT
FACILITY AGREEMENT PROVIDING FOR A
SENIOR
SECURED REDUCING REVOLVING CREDIT FACILITY
OF
UP TO $365,000,000
TO
BE
MADE AVAILABLE TO
SEASPAN
CORPORATION
,
as
Borrower
BY
DNB
NOR BANK ASA, CREDIT SUISSE AND FORTIS CAPITAL CORP.
,
as
Mandated Lead Arrangers
DNB
NOR BANK ASA
,
as Sole
Bookrunner,
Administrative
Agent and Security Agent,
LANDESBANK
HESSEN-THÜRINGEN
,
as
Documentation Agent
AND
THE
BANKS AND FINANCIAL INSTITUTIONS
IDENTIFIED
ON SCHEDULE 1 THERETO
,
as
Lenders
dated
as
of May 19, 2006
SCHEDULES
| 1 | The Lenders and the Initial Commitments | |
| 2 | Commitment Reduction Schedule | |
| 3 | Approved Ship Brokers | |
| 4 | Delivered Vessels |
EXHIBITS
| A | Form of Note | |
| B-1 | Form of Statutory Mortgage | |
| B-2 | Form of Deed of Covenants | |
| C | Form of Assignment of Earnings | |
| D | Form of Assignment of Insurances | |
| E | Form of Tranche B Time Charter Guarantee Assignment | |
| F | Form of Manager’s Undertaking | |
| G | Form of Assignment of Shipbuilding Contracts | |
| H | Form of Assignment and Assumption Agreement | |
| I | Form of Compliance Certificate | |
| J | Form of Drawdown Notice | |
| K | Form of Interest Notice |
SENIOR
SECURED REDUCING REVOLVING CREDIT FACILITY AGREEMENT
THIS
SENIOR SECURED REDUCING REVOLVING CREDIT FACILITY AGREEMENT (this
"Agreement")
is made as of the 19th day of May, 2006,
made by
and among (i) SEASPAN CORPORATION, a corporation organized and existing
under the laws of the Republic of the Marshall Islands (the “Borrower”),
(ii) DNB NOR BANK ASA, acting through its New York Branch (“DnB NOR”) as
sole bookrunner (in such capacity, the “Sole Bookrunner”), administrative agent
(in such capacity, the “Administrative Agent”) and security agent (in such
capacity, the “Security Agent”), (iii) DNB NOR, CREDIT SUISSE (“Credit Suisse”)
and FORTIS CAPITAL CORP. (“Fortis Capital”) as mandated lead arrangers (in such
capacity, the “Mandated Lead Arrangers”), (iv) LANDESBANK HESSEN-THÜRINGEN as
documentation agent (in such capacity, the “Documentation Agent”) and (v) THE
BANKS AND FINANCIAL INSTITUTIONS LISTED ON SCHEDULE 1 HERETO, as
lenders
(together with any bank or financial institution which becomes a
Lender pursuant
to Section 11 of this Agreement, the "Lenders")
.
WITNESSETH
THAT
:
WHEREAS,
the Borrower desires to partly finance the construction and acquisition
costs
of
(a)
two
approximately 3,500 TEU container vessels, which vessels will each
operate on a
12-year time charter to Cosco Container Lines Co., Ltd., and (b)
up to eight
approximately 2,500 TEU container vessels, which vessels will each
operate on a
12-year time charter to China Shipping Container Lines (Asia) Co.,
Ltd.; and
WHEREAS,
at the request of the Borrower, DnB NOR has agreed to serve as
Sole
Bookrunner, Administrative Agent and Security Agent
under this Agreement, DnB NOR, Credit Suisse and Fortis Capital have
agreed to
act as Mandated Lead Arrangers, Landesbank Hessen-Th
ü
ringen
has agreed to act as Documentation Agent and the Lenders have agreed
to provide
to the Borrower a senior secured reducing revolving credit facility
in the
amount of up to Three Hundred Sixty Five Million Dollars ($365,000,000)
on the
terms and conditions set forth herein.
NOW,
THEREFORE, in consideration of the premises set forth above, the
covenants and
agreements hereinafter set forth, and other good and valuable consideration,
the
receipt and adequacy of which are hereby acknowledged, the parties
hereto agree
as set forth below:
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DEFINITIONS.
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1.1
Specific
Definitions
.
In this
Agreement, including the words and expressions specified below shall,
except
where the context otherwise requires, have the meanings attributed
to them
below:
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“Advance(s)”
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means
each of the Pre-Delivery Advances and the Post-Delivery
Advances;
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“Affiliate”
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means
with respect to any Person, any other Person directly or
indirectly
controlled by or under common control with such Person.
For the purposes
of this definition, “control” (including, with correlative meanings, the
terms “controlled by” and “under common control with”) as applied to any
Person means the possession directly or indirectly of the
power to direct
or cause the direction of the management and policies of
that Person
whether through ownership of voting securities or by contract
or
otherwise;
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“Agreement”
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means
this Senior Secured Reducing Revolving Credit Facility
Agreement, as the
same shall be amended, modified or supplemented from time
to
time;
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“Applicable
Rate”
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means
any rate of interest applicable to a Tranche from time
to time pursuant to
Section 6.1;
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“Assignment
and Assumption Agreement(s)”
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means
the Assignment and Assumption Agreement(s) executed pursuant
to
Section 11 substantially in the form set out in
Exhibit H;
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“Assignment
Notices”
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means
notices by the Borrower to be given pursuant to the respective
Assignments;
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“Assignment(s)
of Earnings”
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means
the first priority assignments in respect of any long term
charters and/or
monies payable under any charter or contract to employ
the Collateral
Vessels (including but not limited to the Time Charters)
and the earnings
of the Collateral Vessels from any and all sources, including
the Time
Charters, to be executed by the Borrower in favor of the
Security Agent,
substantially in the form set out in Exhibit C;
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“Assignment(s)
of Insurances”
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means
the first priority assignments in respect of the insurances
over the
Collateral Vessels, to be executed by the Borrower in favor
of the
Security Agent, substantially in the form set out in
Exhibit D;
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“Assignment(s)
of Shipbuilding Contracts”
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means
the first priority assignments in respect of the Shipbuilding
Contracts
and the Refund Guarantees, to be executed by the Borrower
in favor of the
Security Agent, substantially in the form set out in Exhibit
G;
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“Assignments”
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means
the Assignments of Earnings, the Assignments of Insurances,
the
Assignments of Shipbuilding Contracts and the Tranche B
Time Charters
Guarantee Assignments;
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“Available
Amount”
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means
the maximum aggregate amount of each Tranche available
on any given date
as such may be reduced or reborrowed from time to time
pursuant to Section
5;
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“Banking
Day(s)”
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means
days on which banks are open for the transaction of business
of the nature
required by this Agreement in New York, New York, Hong
Kong, Vancouver,
Canada, Hamburg, Germany, and London, England;
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“Breakfunding
Cost”
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means
the amount certified by a Lender (which certificate shall
contain a
calculation in reasonable detail) to be equal to the excess,
if any, of
the present value of the positive amount of (a) the amount of
interest (exclusive of the Margin) which would otherwise
have accrued
pursuant to this Agreement on the principal amount prepaid
for the period
beginning on the date of the prepayment and ending on the
last day of the
then current Interest Period over (b) the interest component of the
amount which such Lender would, on the second Banking Day
prior to the
date of the prepayment in question, have bid in the London
Interbank
market for deposits in Dollars from leading banks of an
amount comparable
to the principal amount prepaid for the period beginning
on the date of
prepayment and maturing on the expiry of the then current
Interest Period;
for these purposes, the present value of any amount shall
be calculated by
the Lender applying the bid rate in (b) above;
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“Borrower”
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has
the meaning ascribed thereto in the preamble;
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“Cash
and Cash Equivalents”
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shall
have the meaning ascribed thereto in Section 9.3;
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“Change
of Control”
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means
the acquisition, directly or indirectly, by any person
or group other than
the Seaspan Group of beneficial ownership of more than
50% of the
aggregate outstanding voting power of the equity interests
of the
Borrower;
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“Charter
Breach”
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means
(i) any failure by a Time Charterer to make payments of
hire under a Time
Charter for a period of three (3) months or (ii) any other breach by
a Time Charterer which would give the Borrower the right
to terminate the
applicable Time Charter;
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“Classification
Society”
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means
a member of the International Association of Classification
Societies with
whom any of the Collateral Vessels is entered and who conducted
periodic
physical surveys and/or inspections of any of the Collateral
Vessels;
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“Code”
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means
the Internal Revenue Code of 1986, as amended, and any
successor statute
and regulations promulgated thereunder;
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“Collateral
Vessel(s)”
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means
each of the Tranche A Collateral Vessels and the Tranche
B Collateral
Vessels;
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“Commitment(s)”
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means,
with respect to any Lender, the portion of the Facility
set out opposite
its name on Schedule 1 or, as the case may be, pursuant
to any assignment
made pursuant to Section 11, which portion may be reduced
in accordance
with the terms of this Agreement;
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“Compliance
Certificate”
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means
a certificate certifying the compliance by the Borrower
with all of the
covenants contained herein and showing the calculations
thereof in
reasonable detail, executed and delivered by the chief
financial officer
of the Borrower to the Administrative Agent from time to
time pursuant to
Section 9.1(e) in the form set out in Exhibit I or in such other
form as the Administrative Agent may agree;
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“Consents
and Agreements”
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means
the Consents and Agreements to be obtained in connection
with the
Assignments of Shipbuilding Contracts;
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“Construction
Period”
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with
respect to the relevant Collateral Vessel means the period
from the date
hereof up to and including one Banking Day prior to the
date on which such
Collateral Vessel is delivered to the Borrower under the
relevant
Shipbuilding Contract;
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“COSCO
Holdings”
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means
China
COSCO Holdings Company Limited, a company organized and
existing under the
laws of China;
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“Credit
Suisse”
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has
the meaning ascribed thereto in the preamble;
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“Creditors”
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means,
collectively, the Lenders, the Mandated Lead Arrangers,
the Administrative
Agent, the Security Agent and any Swap Bank;
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“CSCL”
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China
Shipping Container Lines Co., Ltd., a company organized
and existing under
the laws of China;
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“CSCL
(Hong Kong)”
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China
Shipping Container Lines (Hong Kong) Co., Ltd., a company
organized and
existing under the laws of Hong
Kong;
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“Deed(s)
of Covenants”
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means
the deed of covenants entered into by the Borrower and
the Security Agent,
collateral to the Statutory Mortgage for each Collateral
Vessel,
substantially set out in the form of Exhibit B-2;
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“Default
Rate”
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has
the meaning ascribed thereto in Section 6.2;
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“Delivery
Date(s)”
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means,
with respect to each Collateral Vessel, the date on which
such Collateral
Vessel is delivered to the Borrower;
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“DOC”
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means
a document of compliance issued to an Operator in accordance
with Rule 13
of the ISM Code;
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“Documentation
Agent”
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has
the meaning ascribed thereto in the preamble;
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“Dollars”
and the sign “$”
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means
the legal currency, at any relevant time hereunder, of
the United States
of America and, in relation to all payments hereunder,
in same day funds
settled through the New York Clearing House Interbank Payments
System (or
such other Dollar funds as may be determined by the Administrative
Agent
to be customary for the settlement in New York City of
banking
transactions of the type herein involved);
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“Drawdown
Date(s)”
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means,
with respect to any Advance, the date, being a Banking
Day, upon which the
Borrower has requested that such Advance be made available
to the Borrower
as provided in Section 3;
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“Drawdown
Notice”
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has
the meaning ascribed thereto in Section 3.3;
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“Earnings”
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means,
in respect of a Collateral Vessel, all present and future
monies and
claims which are earned by or become payable to or for
the account of the
Borrower in connection with the operation or ownership
of that Collateral
Vessel and including but not limited to (a) freights, passage
and hire
monies (howsoever earned), (b) remuneration for salvage
and towage
services, (c) demurrage and detention monies, (d) all monies
and claims in
respect of the requisition for hire of that Collateral
Vessel (e) payments
received in respect of any off-hire insurance; and (f)
payments received
pursuant to any Tranche B Time Charter Guarantee relating
to the relevant
Collateral Vessel;
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“Fortis
Capital”
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has
the meaning ascribed thereto in the preamble;
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“GAAP”
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has
the meaning ascribed thereto in Section 1.3;
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“Guangdong”
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Guangdong
Machinery Imp. & Exp. Co. Ltd., a company organized and existing under
the laws of China;
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“Hedge
Agreements”
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means
any interest rate swap, cap or collar agreements, interest
rate future or
option contracts, currency swap agreements, currency future
or option
contracts and other hedging agreements entered or to be
entered into
between the Borrower with a Swap Bank with respect to Advances
drawn under
this Agreement;
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“Indebtedness”
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means
any indebtedness for or in respect of (a) monies borrowed,
(b) any
acceptance credit, (c) any bond, note, debenture, loan
stock or other
similar instrument, (d) any redeemable preference share,
(e) any agreement
treated as a finance or capital lease in accordance with
GAAP, (f)
receivables sold or discounted (otherwise than on a non-recourse
basis),
(g) the acquisition cost of any asset to the extent payable
after its
acquisition or possession by the party liable where the
deferred payment
is arranged primarily as a method of raising finance or
financing the
acquisition of that asset, (h) any derivative transaction
protecting
against or benefiting from fluctuations in any rate or
price (and, except
for non-payment of an amount, the then mark to market value
of the
derivative transaction will be used to calculate its amount),
(i) any
other transaction (including any forward sale or purchase
agreement) which
has the commercial effect of a borrowing, (j) any counter-indemnity
obligation in respect of any guarantee, indemnity, bond,
letter of credit
or any other instrument issued by a bank or financial institution,
or (k)
any guarantee, indemnity or similar assurance against financial
loss of
any person;
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“Indemnitee”
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shall
have the meaning ascribed thereto in Section 18.8;
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“Insurances”
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has
the meaning ascribed thereto in the relevant Deed of
Covenants;
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“Interest
and Principal Coverage Ratio”
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shall
have the meaning ascribed thereto in Section 9.3;
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“Interest
and Principal Expense”
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shall
have the meaning ascribed thereto in Section 9.3;
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“Interest
Expense”
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shall
have the meaning ascribed thereto in Section
9.3;
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“Interest
Notice”
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means
a notice from the Borrower to the Administrative Agent
specifying the
duration of any relevant Interest Period, each substantially
in the form
of Exhibit K;
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“Interest
Period”
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means
periods of one (1), two (2), three (3) or six (6) months
as selected by
the Borrower;
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“ISM
Code”
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means
the International Management Code for the Safe Operation
of Ships and for
Pollution Prevention constituted pursuant to Resolution
A. 741(18) of the
International Maritime Organization and incorporated into
the Safety of
Life at Sea Convention and includes any amendments or extensions
thereto
and any regulation issued pursuant thereto;
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“ISPS
Code”
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means
the
International Ship and Port Facility Security Code adopted
by the
International Maritime Organization at a conference in
December 2002 and
amending the Safety of Life at Sea Convention and includes
any
amendments or extensions thereto and any regulation issued
pursuant
thereto;
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“ISSC”
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means
the International Ship Security Certificate issued pursuant
to the ISPS
Code;
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“Lender(s)”
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has
the meaning ascribed thereto in the preamble;
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“LIBOR”
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means
the rate per annum for deposits of Dollars for a period
equivalent to the
relevant Interest Period at or about 11:00 a.m. (London time) on the
second London Banking Day before the first day of such
period as displayed
on Telerate page 3750 (British Bankers’ Association Interest
Settlement Rates) (or such other page as may replace such
page 3750 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 prior to 11:00 am (London Time) on such
date no such rate
is so displayed for the relevant Interest Period, LIBOR
for such period
shall be the arithmetic mean (rounded upward to four decimal
places) of
the rates respectively quoted to the Administrative Agent
by the Reference
Banks at the request of the Administrative Agent as the
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 the
relevant Interest Period to prime banks in the London Interbank
Market at
or about 11:00 a.m. (London time) on the second Banking Day before
the first day of such period;
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“Majority
Lenders”
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means,
at any time, Lenders whose combined Commitments exceed
fifty percent (50%)
of the total Commitments;
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“Management
Agreement”
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means
the management agreement dated August 8, 2005 between the
Borrower and the
Manager;
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“Manager”
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means
Seaspan Management Services Limited of Clarendon House,
2 Church Street,
Hamilton, HM 11, Bermuda or such other professional manager
or managers as
may be approved by the Administrative Agent (acting in
accordance with the
instructions of the Majority Lenders) from time to
time;
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“Manager’s
Undertaking(s)”
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means
a letter(s) of undertaking to be issued by the Manager
to the Security
Agent confirming,
inter
alia
,
it shall not make a claim to security ranking ahead of
the Creditors’
security in respect of any Collateral Vessel, substantially
set out in the
form of Exhibit F;
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"Mandated
Lead Arranger(s)"
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has
the meaning ascribed thereto in the preamble;
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“Margin”
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means
the Tranche A Margin or the Tranche B Margin, as applicable;
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“Marketable
Securities”
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shall
have the meaning ascribed thereto in Section 9.3;
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“Material
Adverse Effect”
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shall
mean a material adverse effect on (i) the ability of the Borrower to
perform all of its payment obligations under this Agreement
or
(ii) the validity or enforceability of this
Agreement;
|
|
“Materials
of Environmental Concern”
|
shall
have the meaning ascribed thereto in
Section 2.1(r);
|
|
“Measurement
Period”
|
shall
have the meaning ascribed thereto in Section 9.3;
|
|
“Mortgage(s)”
|
means,
collectively, each Statutory Mortgage and related Deed
of Covenants in
respect of each Collateral Vessel, substantially in the
form of Exhibit
B-1 hereto;
|
|
“MTSA”
|
shall
mean the Maritime & Transportation Security Act, 2002, as amended,
inter
alia
,
by Public Law 107-295;
|
|
“Multiemployer
Plan”
|
means,
at any time, a “multiemployer plan” as defined in Section 4001(a)(3) of
ERISA to which the Borrower or any ERISA Affiliate is making
or accruing
an obligation to make contributions or has within any of
the three
preceding plan years made or accrued an obligation to make
contributions;
|
|
“Multiple
Employer Plan”
|
means,
at any time, an employee benefit plan, other than a Multiemployer
Plan,
subject to Title IV or ERISA, to which the Borrower or
any ERISA
Affiliates, and one or more employers other than the Borrower
or an ERISA
Affiliates, are making or accruing an obligation to make
contributions or,
in the event that any such plan has been terminated, to
which the Borrower
or any ERISA Affiliates made or accrued an obligation to
make
contributions during any of the five plan years preceding
the date of
termination of such plan;
|
|
“Post-Delivery
Advance(s)”
|
means
the Tranche A Post-Delivery Advances and/or the Tranche
B Post-Delivery
Advances, as the case may be;
|
|
“Post-Delivery
Advances Availability Period”
|
means
with respect to each Collateral Vessel, the time period
from such
Collateral Vessel’s Delivery Date up to and including the Banking Day
immediately prior to the relevant Final Payment Date of
the Tranche
relating to such Collateral Vessel;
|
|
“Pre-Delivery
Advance(s)”
|
means
any Pre-Delivery Construction Advances and/or Pre-Delivery
Finance Cost
Advances, as the case may be;
|
|
“Pre-Delivery
Advances Availability Period”
|
means
with respect to (a) each Tranche A Collateral Vessel, the
time period from
the date hereof
to
the earlier of (i) the delivery of the second Tranche A
Collateral Vessel
and (ii) March 5, 2008 and (b)
each
Tranche
B Collateral Vessel, the time period from the date hereof
to
the earlier of (i) the delivery of the eighth Tranche B
Collateral Vessel
and (ii) March 31, 2010;
|
|
“Pre-Delivery
Construction Advance(s)”
|
means
any Tranche A Pre-Delivery Construction Advances and Tranche
B
Pre-Delivery Construction Advances;
|
|
“Pre-Delivery
Finance Cost Advance(s)”
|
means
any Tranche A Pre-Delivery Finance Cost Advances and Tranche
B
Pre-Delivery Finance Cost Advances;
|
|
“Reduction
Date(s)”
|
means
a Tranche A Reduction Date or a Tranche B Reduction Date,
as the case may
be;
|
|
“Reference
Banks”
|
shall
mean DnB NOR, Credit Suisse and Fortis Capital and any
other bank or
financial institution appointed as such by the Administrative
Agent
(acting on the instructions of the Majority Lenders) under
this
Agreement;
|
|
“Refund
Guarantee(s)”
|
means
each of the Tranche A Refund Guarantee(s) and the Tranche
B Refund
Guarantee(s);
|
|
“Refund
Guarantor(s)”
|
means
each Tranche A Refund Guarantor(s) and Tranche B Refund
Guarantor(s);
|
|
“Regulation
T”
|
means
Regulation T of the Board of Governors of the Federal Reserve
System, as
in effect from time to time;
|
|
“Regulation
U”
|
means
Regulation U of the Board of Governors of the Federal Reserve
System, as
in effect from time to time;
|
|
“Regulation
X”
|
means
Regulation X of the Board of Governors of the Federal Reserve
System, as
in effect from time to time;
|
|
“Related
Contracts”
|
means
any or all of the following (as the context requires):
(a) the Insurances
and all benefits under the contracts, policies and entries
under such
Insurances and all claims in respect of them and the return
of premiums;
(b) the Time Charters; and (c) the Tranche B Time Charter
Guarantees;
|
|
“Repayment
Ratio”
|
means
a fraction computed at any particular time, the numerator
of which is one
(1) and the denominator is the total number of Collateral
Vessels for
which amounts have been advanced or may be advanced under
such relevant
Tranche;
|
|
“Retention
Account”
|
means
the bank account to be opened by the Borrower with the
Administrative
Agent at its New York branch and designated "Seaspan Corporation
-
Retention Account";
|
|
“SAFE”
|
shall
have the meaning ascribed thereto in Section 4.3(c);
|
|
“Seaspan
Group”
|
means
(a) any of Kyle Washington, Kevin Washington, Gerry Wang,
Graham Porter,
Dennis Washington or any of their estate, spouse, and/or
descendants; (b)
any trust for the benefit of the persons listed in (a)
above; or (c) an
Affiliate of any of the persons listed in (a) or (b)
above;
|
|
“Security
Agent”
|
has
the meaning ascribed thereto in the preamble;
|
|
“Security
Assets”
|
means
any asset which is the subject of a Security Interest created
by a
Security Document, any interest or profit in respect of
an investment of
the monies received in connection with a Security
Document;
|
|
“Security
Document(s)”
|
means
the Mortgages, the Assignments, the Manager’s Undertakings and any other
documents that may be executed as security for the obligations
of the
Borrower under the Facility Agreement, the Note or any
Hedge
Agreement;
|
|
“Security
Interest”
|
means
any mortgage, pledge, lien, charge, assignment, hypothecation
or security
interest or any other agreement or arrangement having a
similar
effect;
|
|
“Shipbuilding
Contract(s)”
|
means
the Tranche A Shipbuilding Contracts and the Tranche B
Shipbuilding
Contracts;
|
|
“Shipyard(s)”
|
means
each of the Tranche A Shipyard and the Tranche B
Shipyard;
|
|
“SMC”
|
means
a safety management certificate issued in respect of the
Collateral
Vessels in accordance with Rule 13 of the ISM Code;
|
|
“Statutory
Mortgage(s)”
|
means
the first priority Hong Kong statutory ship mortgage to
be given by the
Borrower in favor of the Security Agent with respect to
each Collateral
Vessel, in the form set out in Exhibit B-1;
|
|
“Subsidiary(ies)”
|
means,
with respect to any Person, any business entity of which
more than 50% of
the outstanding voting stock or other equity interest is
owned directly or
indirectly by such Person and/or one or more other Subsidiaries
of such
Person;
|
|
“Substitute
Vessel”
|
means,
a vessel of similar size, age, type and Fair Market Value
as the
Collateral Vessel for which it is to be the substitute,
acceptable to the
Majority Lenders;
|
|
“Swap
Bank”
|
means
any Lender who has entered into a Hedge Agreement with
the
Borrower;
|
|
“Tangible
Net Worth”
|
shall
have the meaning ascribed thereto in Section 9.3;
|
|
“Taxes”
|
means
any tax, levy, impost, duty or other charge or withholding
of a similar
nature (including, without limitation, any penalty or interest
payable in
connection with any failure to pay or any delay in paying
any of the
same);
|
|
“Time
Charterer”
|
means
the Tranche A Time Charterer and/or the Tranche B Time
Charterer, as the
context requires;
|
|
“Time
Charters”
|
means
the Tranche A Time Charters and/or the Tranche B Time Charters,
as the
context requires;
|
|
“Total
Assets”
|
shall
have the meaning ascribed thereto in Section 9.3;
|
|
“Total
Borrowings”
|
shall
have the meaning ascribed thereto in Section 9.3;
|
|
“Total
Loss”
|
has
the meaning ascribed thereto in the relevant Deed of
Covenants;
|
|
“Tranche(s)”
|
means
each of Tranche A and Tranche B;
|
|
“Tranche
A”
|
means
that portion of the Facility equal to the lesser of (a)
Eighty Two Million
Dollars ($82,000,000) and (b) eighty percent (80%) of the
aggregate
Tranche A Collateral Vessels Delivered
Costs;
|
|
“Tranche
A Collateral Vessels”
|
means
the two approximately 3,500 TEU container vessels constructed
by the
Tranche A Shipyard designated as Builder’s Hull Nos.
125
and
126
,
respectively, and delivered to the Borrower on the relevant
Delivery
Date;
|
|
“Tranche
A Collateral Vessels Delivered Cost”
|
means,
with respect to each Tranche A Collateral Vessel, the sum
of (i)
$36,650,000 and €6,250,000 (representing the purchase price of such
Collateral Vessel under the relevant Shipbuilding Contract
as adjusted in
accordance therewith), (ii) the amounts paid for the acquisition
of the
Collateral Vessel, including as reimbursement for payments
previously made
pursuant to the relevant Shipbuilding Contracts to Conti
51. Container
Schiffahrts-GMBH & Co. KG Nr. 1 and Conti 52. Container
Schiffahrts-GMBH & Co. KG Nr. 1, respectively, (iii) the costs of all
owner furnished equipment, including lashings, lubricants
and consumable
stores, (iv) interest, accrued during construction, (v)
financing,
accounting and legal costs accrued during construction
(other than
interest but including fees referred to in Section 14 of
this Agreement),
(vi) changes and extras and (vii) the aggregate of all shipyard
supervisory costs incurred by the Borrower with respect
to such Collateral
Vessel prior to the delivery thereof, as certified by the
Chief Financial
Officer of the Borrower;
|
|
“Tranche
A Final Payment Date”
|
means
the date which is the earlier of (a) the tenth anniversary
of the Delivery
Date of the last delivered Tranche A Collateral Vessel
and (b) July 31,
2017;
provided
that if such date is not a Banking Day, then the Tranche
A Final Payment
Date shall be the immediately preceding Banking Day;
|
|
“Tranche
A Margin”
|
means
with respect to advances drawn under Tranche A, during
the period from the
date of this Credit Agreement up to earlier of (a) the
sixth
(6
th
)
anniversary of the Delivery Date of the second Tranche
A Collateral Vessel
and (b) July 31, 2013, 0.850% per annum and thereafter
0.925% per
annum;
|
|
“Tranche
A Post-Delivery Advance(s)”
|
means
each Advance of Tranche A made by the Lenders to the Borrower
on or after
the Delivery Date of a Tranche A Collateral Vessel;
|
|
“Tranche
A Pre-Delivery Construction Advance(s)”
|
means
any Advance of Tranche A made by the Lenders to the Borrower
with respect
to any construction installment under the relevant Shipbuilding
Contract
relating to a Tranche A Collateral Vessel and any expenses
or payments
associated with the items listed in paragraphs (ii), (iii),
(iv) and (vi)
of the definition of Tranche A Collateral Vessels Delivered
Cost during
the relevant Construction Period;
|
|
“Tranche
A Pre-Delivery Finance Cost Advance(s)”
|
means
an Advance of up to $500,000 per Tranche A Collateral Vessel
of Tranche A
made by the Lenders to the Borrower solely for the purpose
of covering
expenses or payments associated with the items listed in
paragraphs (iv),
(v) and (vii) of the definition of Tranche A Collateral
Vessels Delivered
Cost during the relevant Construction Period
),
and other costs for such Collateral Vessel not covered
by the relevant
Refund Guarantee
;
|
|
“Tranche
A Reduction Date(s)”
|
means
each of (i) the earlier of (a) the date that is six (6) months from
the Delivery Date of the last delivered Tranche A Collateral
Vessel and
(b) March 31, 2008, and (ii) the last day of each six (6) month
period thereafter up to and including the Tranche A Final
Payment Date;
provided
that if any such date is not a Banking Day, then such Tranche
A Reduction
Date shall be the immediately preceding Banking Day;
|
|
“Tranche
A Refund Guarantee(s)”
|
means
those certain SAFE registered refund guarantees from the
Tranche A Refund
Guarantors, in respect of the construction of the Tranche
A Collateral
Vessels, which may be issued in favor of or novated to
the
Borrower;
|
|
“Tranche
A Refund Guarantor(s)”
|
means
the Agricultural Bank of China, Ningbo Branch and Bank
of China, Ningbo
Branch or those certain banks or other financial institutions,
acceptable
to each of the Lenders, responsible for issuing Tranche
A Refund
Guarantees;
|
|
“Tranche
A Shipbuilding Contracts”
|
means
those certain shipbuilding contracts entered into between
each of Conti
51. Container Schiffahrts-GMBH & Co. KG Nr. 1 and Conti 52. Container
Schiffahrts-GMBH & Co. KG Nr. 1, as purchaser and Zheijiang
Shipbuilding Co. Ltd, as seller, with respect to each of
the Tranche A
Collateral Vessels which may be assigned to and assumed
by, or novated to,
the Borrower;
|
|
“Tranche
A Shipyard”
|
means
Zhejiang Shipbuilding Co. Ltd.;
|
|
“Tranche
A Time Charterer”
|
means
Cosco Container Lines Co., Ltd., a company organized and
existing under
the laws of China;
|
|
“Tranche
B Post-Delivery Advance(s)”
|
means
each Advance of Tranche B made by the Lenders to the Borrower
on or after
the Delivery Date of a Tranche B Collateral Vessel;
|
|
“Tranche
B Pre-Delivery Construction Advance(s)”
|
means
any Advance of Tranche B made by the Lenders to the Borrower
with respect
to any construction installment under the relevant Shipbuilding
Contract
relating to a Tranche B Collateral Vessel and any expenses
or payments
associated with the items listed in paragraphs (ii), (iii)
and (v) of the
definition of Tranche B Collateral Vessels Delivered Cost
during the
relevant Construction Period;
|
|
“Tranche
B Pre-Delivery Finance Cost Advance(s)”
|
means
an Advance of up to $500,000 per Tranche B Collateral Vessel
of Tranche B
made by the Lenders to the Borrower solely for the purpose
of
covering
expenses or payment associated with items listed in paragraphs
(iii), (iv)
and (vi) in the definition of Tranche B Collateral Vessels
Delivered Cost,
and other costs for such Collateral Vessel not covered
by the relevant
Refund Guarantee
during the relevant Construction Period;
|
|
“Tranche
B Reduction Date(s)”
|
means
each of (i) the earlier of (a) the date that is six (6) months from
the Delivery Date of the last delivered Tranche B Collateral
Vessel and
(b) April 30, 2010; and (ii) the last day of each six (6) month
period thereafter up to and including the Tranche B Final
Payment Date;
provided
that if such date is not a Banking Day, then such Tranche
B Reduction Date
shall be the immediately preceding Banking Day;
|
|
“Tranche
B Refund Guarantor(s)”
|
means
those certain banks or other financial institutions, acceptable
to each of
the Lenders, responsible for issuing Tranche B Refund
Guarantees;
|
|
“Tranche
B Refund Guarantee(s)”
|
means
those certain refund guarantees executed by the Tranche
B Refund
Guarantors, in respect of the construction of the Tranche
B Collateral
Vessels, in favor of the Borrower;
|
|
“Tranche
B Shipbuilding Contracts”
|
means
those certain shipbuilding contracts entered into between
the Borrower, as
purchaser, and the Tranche B Shipyard and Guangdong. as
seller, with
respect to Hull No. YZJ 2005-696C and Hull No. YZJ 2006-717C
of the
Tranche B Collateral Vessels and the Tranche B Shipyard
with respect to
each other of the Tranche B Collateral
Vessels;
|
|
“Tranche
B Shipyard”
|
means
Jiangsu Yangzijiang Shipbuilding Co., Ltd.;
|
|
“Tranche
B Time Charterer”
|
means
China Shipping Container Lines (Asia) Co., Ltd., a company
organized and
existing under the laws of the British Virgin Islands;
|
|
“Tranche
B Time Charters”
|
means
those certain long-term time charters entered or to be
entered into
between the Borrower, as owner and the Tranche B Time Charterer,
as
charterer with respect to the Tranche B Collateral Vessels,
which for the
Tranche B Collateral Vessels whose contracts have been
confirmed, namely
Builder’s
Hull Nos.
YZJ
2005-696C, YZJ 2006-716C, YZJ 2006-717C, and YZJ 2006-718C
are those
long-term time charters each dated February 28, 2006 each
with respect to
one of such Tranche B Collateral Vessels
;
|
|
“Tranche
B Time Charters Guarantee(s)”
|
those
certain guarantees of the obligations of the Tranche B
Time Charterer
under the Tranche B Time Charters by each of the Tranche
B Time Charters
Guarantors in favor of the Borrower;
|
|
“Tranche
B Time Charters Guarantors”
|
means
each of CSCL and CSCL (Hong Kong);
|
|
“Tranche
B Time Charters Guarantee Assignment(s)”
|
means
the first priority assignments of the Tranche B Time Charters
Guarantees
by the Borrower in favor of the Security Agent, substantially
in the form
of Exhibit E hereto; and
|
|
“Vessel
Costs”
|
means
the Tranche A Collateral Vessels Delivered Cost and the
Tranche B
Collateral Vessels Delivered Cost.
|
1.2
Computations
of Time Periods; Other Definitional Provisions
.
In this
Agreement, the Note and the Security Documents, unless the context
otherwise
requires, in the computation of periods of time from a specified
date to a later
specified date, the word “from” means “from and including” and the words “to”
and “until” each mean “to but excluding”; words importing either gender include
the other gender; references to “writing” include printing, typing and other
means of reproducing words in a tangible visible form; the words
“including,”
“includes” and “include” shall be deemed to be followed by the words “without
limitation”; references to articles, clauses (or subdivisions of clauses),
exhibits, annexes or schedules are to this Agreement, the Note or
such Security
Document, as applicable; references to agreements and other contractual
instruments (including this Agreement, the Note and the Security
Documents)
shall be deemed to include all subsequent amendments, amendments
and
restatements, supplements, extensions, replacements and other modifications
to
such instruments (without, however, limiting any prohibition on any
such
amendments, extensions and other modifications by the terms of this
Agreement,
the Note or any Security Document); references to any matter that
is “approved”
or requires “approval” of a party shall mean approval given in the sole and
absolute discretion of such party unless otherwise specified.
1.3
Accounting
Terms
.
Unless
otherwise specified herein, all accounting terms used in this Agreement,
the
Note and in the Security Documents shall be interpreted, and all
financial
statements and certificates and reports as to financial matters required
to be
delivered to the Administrative Agent or to the Lenders under this
Agreement
shall be prepared, in accordance with generally accepted accounting
principles
for the United States (“GAAP”) as from time to time in effect.
1.4
Certain
Matter Regarding Materiality
.
To the
extent that any representation, warranty, covenant or other undertaking
of the
Borrower in this Agreement is qualified by reference to those which
are not
reasonably expected to result in a “material adverse effect” or language of
similar import, no inference shall be drawn therefrom that any Administrative
Agent or any Lender has knowledge or approves of any noncompliance
by the
Borrower with any governmental rule.
1.5
Forms
of Documents
.
Except
as otherwise expressly provided in this Agreement, references to
documents or
certificates “substantially in the form” of Exhibits to another document shall
mean that such documents or certificates are duly completed in the
form of the
related Exhibits with substantive changes subject to the provisions
of
Section 18.7 of this Agreement, as the case may be, or the correlative
provisions of the Security Documents.
| 2. |
REPRESENTATIONS
AND WARRANTIES.
|
2.1
Representations
and Warranties
.
In
order to induce the Creditors to enter into this Agreement and the
Lenders to
make the Facility available to the Borrower, the Borrower represents
and
warrants to the Creditors (which representations and warranties shall
survive
the execution and delivery of this Agreement and the making of the
Facility)
that:
(a)
Use
of
Proceeds
.
The
Borrower requires
the
Facility
for use in connection with its lawful corporate purpose and for no
other
purposes and the Borrower's use of the Facility does not contravene
a
ny
law,
official requirement or other regulatory measure or procedure applicable
to the
Borrower implemented to combat “money laundering” (as defined in Article 1 of
the Directive (91/308/EEC) of the Council of the European Communities)
and
comparable United States Federal and state laws applicable to the
Borrower;
(b)
Corporate
Status
.
The
Borrower is a company duly organized and validly existing under the
laws of its
jurisdiction of formation, and is qualified to do business in each
jurisdiction
wherein the nature of the business transacted thereby makes such
qualification
necessary;
(c)
The
Borrower's Corporate Authority
.
The
Borrower has full power and authority to, and all necessary consents
and
authorities have been obtained to permit the Borrower to carry on
its business
as now being conducted and to enter into and perform its obligations
under this
Agreement, the Note, any Hedge Agreement and the Security Documents
to which it
is a party and to borrow, service and repay the Facility and no further
consents
or authorities are necessary for the service and repayment of the
Facility or
any part thereof;
(d)
Enforceability
.
Each of
the Facility Documents to which it is a party constitutes the legal,
valid and
binding obligation of the Borrower, enforceable against the Borrower
in
accordance with its terms, subject, however, (1) to the effect of
insolvency, bankruptcy, reorganization, moratorium or other laws
affecting
generally the enforcement of creditors rights, and (2) general equitable
principles, regardless of whether the issue of enforceability is
considered in a
proceeding in equity or at law;
(e)
Filings;
Stamp Taxes
.
Other
than the recording of the Statutory Mortgages with the Hong Kong
Shipping
Register, the filing of the Security Documents with the Hong Kong
Registrar of
Companies, the registration of the Refund Guarantees and the Assignments
of
Shipbuilding Contracts with SAFE, the filing of financing statements
with the
personal property registry in British Columbia in respect of the
Security
Documents and the filing of UCC Financing Statements in Washington,
D.C. in
respect of the Security Documents, and fees consequent thereto, it
is not
necessary for the legality, validity, enforceability or admissibility
into
evidence of this Agreement, the Note or any of the other Facility
Documents that
any of them or any document relating thereto other than the Tranche
B Time
Charters Guarantees insofar as they relate to China Shipping Container
Lines
Co., Ltd. and the Tranche B Time Charters Guarantee Assignment relating
thereto
be registered, filed recorded or enrolled with any court or authority
in any
relevant jurisdiction or that any stamp, registration or similar
Taxes be paid
on or in relation to this Agreement, the Note or any of the other
Facility
Documents;
(f)
Approvals;
Consents
.
All
consents, licenses, approvals and authorizations required, whether
by statute or
otherwise, in connection with the entry into and performance by the
Borrower,
and the validity and enforceability against the Borrower, of this
Agreement the
Note and the Facility Documents to which it is a party, have been
obtained and
are in full force and effect;
(g)
Violation
of Law, Contracts
.
The
execution and delivery of, the performance of its obligations under,
and
compliance by the Borrower with the provisions of this Agreement,
the Note and
the Facility Documents to which it is a party do not, and (except
where any such
contravention would not effect the enforceability of such Facility
Document)
will not during the period which the Facility is available, contravene
(i) any
applicable law or regulation applicable to the Borrower existing
at the date
hereof, (ii) any contractual restriction binding the Borrower or
its assets or
(iii) the constituting instruments of the Borrower;
(h)
Borrower
Litigation
.
No
action, suit or proceeding is pending or, to the best knowledge of
the Borrower,
threatened against the Borrower which if adversely determined would
reasonably
be expected to result in a Material Adverse Effect;
(i)
Investment
Company
.
The
Borrower is not required to be registered as an “investment company” (as defined
in the Investment Company Act of 1940, as amended);
(j)
Margin
Stock
.
None of
the proceeds of the Facility will be used to purchase or carry margin
stock
within the meanings of Regulations T, U or X of the Board of Governors
of the
Federal Reserve System; the Borrower is not engaged in the business
of extending
credit for the purpose of purchasing or carrying margin stock within
the meaning
of Regulations T, U or X of the Board of Governors of the Federal
Reserve
System;
(k)
Financial
Information
.
All
financial statements, information and other data furnished by the
Borrower to
the Administrative Agent or the Lenders are , in all material respects,
complete
and correct, and such financial statements have been prepared in
accordance with
GAAP and accurately and fairly represent in all material respects
the financial
condition of the Borrower as of the date or respective dates thereof
and the
results of operations of such Borrower for the period or respective
periods
covered by such financial statements, and there has been no material
adverse
change since the date of the most recent financial statements delivered
to the
Administrative Agent in the financial condition or results of operations
of the
Borrower other than as previously disclosed to the Administrative
Agent in
writing; the Borrower does not have any contingent obligations, liabilities
for
taxes or other outstanding financial obligations which are material
in the
aggregate except as disclosed in such statements, information and
data;
(l)
The
Collateral Vessels
.
On the
Delivery Date and after acceptance of the delivery of the Collateral
Vessel by
the Borrower in respect thereof, the relevant Collateral Vessels:
| (i) |
will
be in the sole and absolute ownership of the Borrower,
unencumbered save
and except for the Mortgage over such Collateral Vessel
in favor of the
Security Agent and except for Permitted Liens, and will
be duly registered
in the name of the Borrower under the flag of the jurisdiction
in which
the Collateral Vessel is currently
registered;
|
| (ii) |
will
be classed in the highest classification and rating for
vessels of the
same age and type with the relevant Classification Society
without any
material outstanding overdue recommendations affecting
class;
|
| (iii) |
will
be seaworthy for hull and machinery insurance warranty
purposes;
|
| (iv) |
will
be in every material way fit for its contracted services
under the
relevant Time Charter;
|
| (v) |
will
be insured in accordance with the provisions of the Mortgage
thereon and
the requirements thereof in respect of such insurances
will have been
fulfilled;
|
| (vi) |
will
comply with all relevant laws, regulations and requirements
(including
environmental laws, regulations and requirements), statutory
or otherwise,
as are applicable to (A) vessels
documented
|
| (vii) |
under
Hong Kong flag, as applicable, and (B) vessels engaged in a trade or
operations similar to that to be performed by such Collateral
Vessel,
except where the failure to so comply would not have a
material adverse
effect on the operation of such Collateral Vessel in its
intended trade;
and
|
| (viii) |
has
been accepted for service by the relevant Time Charterer
under the
applicable Time Charter and such Time Charter is in full
force and
effect;
|
(m)
Foreign
Assets Control Regulation
.
None of
the transactions contemplated herein will violate any of the provisions
of the
Foreign Assets Control Regulations of the United States of America
(Title 31, Code of Federal Regulations, Chapter V, Part 500, as
amended), any of the provisions of the Cuban Assets Control Regulations
of the
United States of America (Title 31, Code of Federal Regulations,
Chapter V, Part 515, as amended), any of the provisions of the Libyan
Assets Control Regulations of the United States of America (Title 31, Code
of Federal Regulations, Chapter V, Part 550, as amended), any of the
provisions of the Iranian Assets Control Regulations (Title 31, Code of
Federal Regulations, Chapter V, Part 560, as amended) or any
provisions of Executive Order No. 12810, or any of the provisions of the
Regulations of the United States of America Governing Transactions
in Foreign
Shipping of Merchandise (Title 31, Code of Federal Regulations,
Chapter V, Part 505, as amended);
(n)
Borrower's
Office
.
The
chief executive office and principal place of business of the Borrower
is
located at Unit 2, 7th Floor, Bupa Centre, 141 Connaught Road West,
Hong Kong,
China;
(o)
ERISA
.
The
execution and delivery by the Borrower of this Agreement, the Note
and the
Security Documents to which it is a party and the consummation by
the Borrower
of the transactions hereunder and thereunder will not involve any
prohibited
transaction within the meaning of ERISA or Section 4975 of the Code.
No
condition exists or event or transaction has occurred in connection
with any
Plan maintained or contributed to by the Borrower or any ERISA Affiliate
thereof
resulting from the failure of any thereof to comply with ERISA insofar
as ERISA
applies thereto which is reasonably likely to result in the Borrower
or any
ERISA Affiliate thereof incurring any liability, fine or penalty
which
individually or in the aggregate would have a Material Adverse
Effect;
(p)
Taxes
.
The
Borrower has filed or caused to be filed all tax returns which, to
its
knowledge, are required to have been filed and has paid all taxes
shown to be
due and payable on said returns or on any assessments made to its
knowledge
against it or any of its property or assets, except for those taxes
which are
being disputed in good faith by appropriate proceedings and for which
adequate
reserves have been made;
(q)
Payments
Free of Taxes
.
All
payments made or to be made by the Borrower under or pursuant to
this Agreement,
the Note or the other Facility Documents
may
be
made free and clear of, and without deduction or withholding for
or on account
of, any Taxes;
(r)
Environmental
Compliance
.
Except
as notified by the Borrower to the Administrative Agent prior to
the date
hereof,
(i)
the
Borrower is and will be in compliance in all material respects with
all
applicable United States federal and 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, waters
of the
contiguous zone, ocean waters and international waters), including,
without
limitation, laws, regulations, conventions and agreements relating
to
(1) emissions, discharges, releases or threatened releases of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous materials,
oil,
hazardous substances, petroleum and petroleum products and by-products
(“Materials of Environmental Concern”), or (2) the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of
Materials of Environmental Concern (“Environmental Laws”) except to the extent
that any non-compliance on or after the date hereof as a result of
the release
of Materials of Environmental Concern result in a penalty, fine or
damages
covered by insurance (less ordinary and reasonable deductibles);
(ii) the
Borrower has all permits, licenses, approvals, rulings, variances,
exemptions,
clearances, consents or other authorizations required under applicable
Environmental Laws (“Environmental Approvals”) in order for it to operate its
vessels in their intended trade; (iii) the Borrower has not received any
notice of any claim, action, cause of action, investigation or demand
by any
person, entity, enterprise or government, or any political subdivision,
intergovernmental body or agency, department or instrumentality thereof,
alleging potential liability in a material amount for, or a requirement
to
incur, investigatory costs, cleanup costs, response and/or remedial
costs
(whether incurred by a governmental entity or otherwise), natural
resources
damages, property damages, personal injuries, attorneys' fees and
expenses, or
fines or penalties, in each case arising out of, based on or resulting
from
(1) the presence, or release or threat of release into the environment,
of
any Materials of Environmental Concern at any location, whether or
not owned by
such person that is not in material compliance with Environmental
Laws, or
(2) circumstances forming the basis of any material violation, of any
Environmental Law or Environmental Approval (“Environmental Claim”) (other than
Environmental Claims that have been fully and finally adjudicated
or otherwise
determined and all fines, penalties and other costs, if any, payable
by the
Borrower, in respect thereof have been paid in full or which are
fully covered
by insurance (including permitted deductibles)); and (iv) to the best
knowledge of the Borrower there are no circumstances that would prevent
or
interfere with such material compliance in the future;
(s)
Environmental
Claims
.
As of
the date hereof, there is no Environmental Claim pending or, to the
best of the
knowledge of the Borrower, threatened against the Borrower or
Operator;
(t)
Past
Environmental Matters
.
As of
the date hereof, to the best knowledge of the Borrower, there are
no past or
present actions, activities, circumstances, conditions, events or
incidents,
including, without limitation, the release, emission, discharge or
disposal of
any Materials of Environmental Concern, that could form the basis
of any
Environmental Claim against the Borrower;
(u)
Compliance
with ISM Code and ISPS Code
.
After
the Delivery Date, each Collateral Vessel and its respective Operator
complies
with the requirements of the ISM Code, and the ISPS Code including
(but not
limited to) the maintenance and renewal of valid certificates pursuant
thereto;
(v)
No
Threatened Withdrawal of DOC, ISSC or SMC
.
After
its Delivery Date, there is no actual or, to the best knowledge of
the Borrower,
threatened withdrawal of the DOC, ISSC or SMC of a Collateral Vessel
or other
certification or documentation related to the ISM Code, the ISPS
Code or
otherwise required for the operation of any Collateral Vessel; and
(w)
Survival
of Representations
.
All
representations and warranties made herein and in any certificate
or other
document delivered pursuant hereto or in connection herewith shall
survive the
making of the Facility and the issuance of the Note to be issued
by the Borrower
hereunder.
| 3. |
AMOUNT
AND TERMS OF THE FACILITY.
|
3.1
Purposes
.
The
Lenders shall make the Facility available to the Borrower in the
maximum
aggregate amount of up to Three Hundred Sixty Five Million Dollars
($365,000,000) for the purpose of (i) financing the construction,
acquisition
and other Vessel Costs associated with the Collateral Vessels and
(ii) after the
delivery of each of the Collateral Vessels in accordance herewith,
general
corporate purposes.
3.2
Advances
.
(a)
Pre-Delivery
Advances
.
Each of
the Lenders, relying upon each of the representations and warranties
set out in
Section 2, hereby severally and not jointly, agrees with the Borrower
that,
subject to and upon the terms of this Agreement, it will on the Drawdown
Dates
from time to time during the Pre-Delivery Advances Availability Period
with
respect to each Collateral Vessel make its portion of the Pre-Delivery
Advances
in respect of such Collateral Vessel available through the Administrative
Agent
to the Borrower;
provided
,
however
with
respect to each Collateral Vessel, Pre-Delivery Construction Advances
shall be
used only to cover Vessel Costs up to the amount that is guaranteed
by the
relevant Refund Guarantee.
(b)
Post-Delivery
Advances
.
Each of
the Lenders, relying upon each of the representations and warranties
set out in
Section 2, hereby severally and not jointly agrees with the Borrower
that,
subject to and upon the terms of this Agreement, it will during the
Post-Delivery Advances Availability Period with respect to each Collateral
Vessel make Post-Delivery Advances available to the Borrower through
the
Administrative Agent;
provided
,
however
,
that
the aggregate outstanding principal amount of Post-Delivery Advances
may not
exceed the Facility (less the principal amount of outstanding Pre-Delivery
Advances) as reduced pursuant to Article 5 hereof.
3.3
Drawdown
Notice
.
The
Borrower shall, at least three (3) Banking Days before each of the Drawdown
Dates, serve a notice (a “
Drawdown
Notice
”)
substantially in the form of Exhibit J on the Administrative Agent. Each
such notice shall (a) be in writing addressed to the Administrative Agent,
(b) be effective on receipt by the Administrative Agent, (c) specify
the amount of the Advance to be drawn (which shall be in a minimum
amount of
$500,000), (d) specify whether such Advance is a Pre-Delivery Finance
Cost
Advance, Pre-Delivery Construction Advance or a Post-Delivery Advance
and, in
the case of a Pre-Delivery Advance, or a Post-Delivery Advance made
in
connection with a delivery installment, identify the Collateral Vessel
to which
such Advance relates, (e) specify the Banking Day on which such Advance is
to be drawn, (f) specify the initial Interest Period for such Advance,
(g) specify the disbursement instructions and (h) be
irrevocable.
3.4
Effect
of Drawdown Notice
.
Each
such Drawdown Notice shall be deemed to constitute a warranty by
the Borrower
(a) that the representations and warranties stated in Section 2
(updated mutatis mutandis) are true and correct on and as of the
date of such
Drawdown Notice and will be true and correct on and as of such Drawdown
Date as
if made on such date, and (b) that no Event of Default nor any event
which with
the giving of notice or lapse of time or both would constitute an
Event of
Default has occurred and is continuing.
| 4. |
CONDITIONS.
|
4.1
Conditions
Precedent to the Obligations of the Lenders under this Agreement
.
The
Lenders obligations under this Agreement shall be subject to the
following
conditions precedent having been met:
(a)
Corporate
Documents
.
the
Administrative Agent shall have received the following documents
in form and
substance satisfactory to the Administrative Agent:
| (i) |
copies,
certified as true and complete by an officer of the Borrower,
of the
resolutions of the board of directors of the Borrower,
evidencing approval
of this Agreement, the Note and the Security Documents
to which it is a
party and authorizing an appropriate officer or officers
or attorney or
attorneys-in-fact to execute the same on its
behalf;
|
| (ii) |
certified
copies of all documents evidencing any other necessary
action (including
by such parties thereto other than the Borrower as may
reasonably be
required by the Administrative Agent), approvals or consents
with respect
to this Agreement, the Note and the Facility
Documents;
|
| (iii) |
certified
copies of the constitutional documents of the Borrower
and all amendments
thereto; and
|
| (iv) |
a
good standing certificate or the equivalent thereto of
the
Borrower;
|
| (b) |
This Agreement and Note
.
the Borrower shall have duly executed and delivered this
Agreement and the
Note to the Administrative Agent;
|
(c)
Financial
Statements; Solvency
.
the
Administrative Agent shall have received the most recent annual audited
financial statements or quarterly unaudited financial statements
for the
Borrower, which financial statements shall evidence satisfactorily to the
Lenders the solvency of the Borrower;
(d)
Compliance
Certificate
.
the
Administrative Agent shall have received a Compliance Certificate
with respect
to the most recently ended fiscal quarter;
(e)
Licenses,
Consents and Approvals
.
the
Administrative Agent shall be reasonably satisfied that all necessary
licenses,
consents and approvals in connection with the transactions contemplated
by this
Agreement, the Note and the Security Documents have been obtained;
and
(f)
Money
Laundering Due Diligence
.
the
Administrative Agent having received such documentation and other
evidence as is
reasonably requested by the Administrative Agent in order for each
Lender to
carry out and be satisfied with the results of all necessary “know your client”
or other checks which it is required to carry out in relation to
the
transactions contemplated by this Agreement, the Note and the Security
Documents.
4.2
Conditions
Precedent to Pre-Delivery Finance Cost Advances
.
In
addition to the conditions set forth in Section 4.1 and 4.5 hereof,
the
obligations of the Lenders to make any Pre-Delivery Finance Cost
Advances with
respect to any Collateral Vessel shall be expressly subject to the
following
conditions precedent on the relevant Drawdown Date:
(a)
Shipbuilding
Contracts
.
The
Administrative Agent shall have received (i) in the case of an Advance
under
Tranche A, a copy of the relevant Tranche A Shipbuilding Contract,
in form and
substance satisfactory to the Lenders in all respects together with
evidence
satisfactory to the Administrative Agent that such Tranche A Shipbuilding
Contract has been novated to, or assigned to and assumed by, the
Borrower to
provide for the Borrower as purchaser and (ii) in the case of an
Advance under
Tranche B, a copy of the relevant executed Shipbuilding Contract,
in form and
substance satisfactory to the Lenders in all respects;
provided
that
,
in
either case, if any Shipbuilding Contract has been entered into on
terms and
conditions substantially identical to those previously accepted by
the
Administrative Agent pursuant to this Section 4.2 (a), such Shipbuilding
Contract shall be considered satisfactory in form in and in substance
to the
Administrative Agent for purposes of this Section 4.2 (a);
(b)
Time
Charters/Tranche B Time Charters Guarantee/Management Agreement
.
the
Administrative Agent shall have received copies, in form and substance
satisfactory to the Administrative Agent in all respects, certified
by an
officer of the Borrower, of the relevant Time Charter, and if such
Advance
relates to a Tranche B Collateral Vessel, the relevant Tranche B
Time Charters
Guarantee, and the Management
(c)
Agreement;
provided
that
,
if any
Time Charter, Tranche B Time Charters Guarantee or Management Agreement
has been
entered into on terms and conditions substantially identical to those
previously
accepted by the Administrative Agent pursuant to this Section 4.2(b),
such
documents shall be considered satisfactory in form in and in substance
to the
Administrative Agent for purposes of this Section 4.2 (b);
(d)
Signatories
Authority
.
the
Administrative Agent having received such evidence of the signing
authority of
(i) the Shipyards and Guangdong, as the case may be, as is a party
thereto, to
execute the Shipbuilding Contracts, (ii) the Time Charterers to execute
the
relevant Time Charter, (iii) and the Tranche B Time Charter Guarantors
to
execute the relevant Tranche B Time Charter Guarantees;
(e)
Fees
.
the
Mandated Lead Arrangers and the Administrative Agent shall have received
payment
of the fees payable under Section 14 and under the Fee Letter to
the extent that
the relevant Drawdown Notice did not instruct such fees to be paid
from the
relevant Advance; and
(f)
Legal
Opinions
.
the
Administrative Agent shall have received opinions, dated the relevant
Drawdown
Date, each in form and substance reasonably satisfactory to the Administrative
Agent and its counsel, from (i) Bull, Housser & Tupper, LLP, counsel to
the Borrower, (ii) Seward & Kissel LLP, special counsel to the
Administrative Agent, Security Agent and the Lenders, (iii) if such
Advance is a
Tranche B Finance Cost Pre-Delivery Advance, Johnson, Stokes & Master,
special Hong Kong counsel to the Administrative Agent, (iv) if such
Advance is a
Tranche B Finance Cost Pre-Delivery Advance, Appleby Spurling Hunter,
special
British Virgin Island counsel to the Administrative Agent, and (v)
Global Law
Office, special Chinese counsel to the Administrative Agent.
4.3
Conditions
Precedent to the Pre-Delivery Construction Advances
.
In
addition to the conditions set forth in Section 4.1, 4.2 and 4.5,
the
obligations of the Lenders to make any Pre-Delivery Construction
Advances with
respect to any Collateral Vessel shall be expressly subject to the
following
conditions precedent on the relevant Drawdown Date:
(a)
Refund
Guarantees
.
the
Administrative Agent shall have received (i) in the case of an Advance
under
Tranche A, a copy of the relevant Tranche A Refund Guarantee, in
form and
substance satisfactory to the Lenders in all respects together with
evidence
satisfactory to the Administrative Agent that such Tranche A Refund
Guarantee
has been novated to, or assigned to, the Borrower or a new refund
guarantee, in
form and substance satisfactory to the Lenders in all respects has
been entered
into in favor of the Borrower; and (ii) in the case of an Advance
under Tranche
B, a copy of the Refund Guarantee, in form and substance satisfactory
to the
Lenders in all respects
provided that
,
in
either case, if any Refund Guarantee has been entered into on terms
and
conditions substantially identical to those previously accepted by
the
Administrative Agent pursuant to this Section 4.3(a), such documents
shall be
considered satisfactory in form in and in substance to the Administrative
Agent
for purposes of this Section 4.3 (a);
(b)
SAFE
Registration of Refund Guarantees
.
The
relevant Refund Guarantee and Assignment of Shipbuilding Contract
shall be
registered with the applicable branch of the State Administration
of Foreign
Exchange (“SAFE”) of the relevant Refund Guarantor. Notwithstanding the
foregoing, the Assignment of Shipbuilding Contract shall only be
required to be
registered with SAFE should the Administrative Agent determine that
such
registration is necessary or advisable and can be done under the
administrative
policy of the applicable branch and, if such determination is made,
the Borrower
will use commercially reasonable efforts to cause such registration
within
thirty (30) days following the initial Pre-Delivery Construction
Advance of the
relevant Collateral Vessel by the acceptance of SAFE of the submission
of the
registration;
(c)
Signatories
Authority
.
the
Administrative Agent having received such evidence of the signing
authority of
the (i) relevant Refund Guarantor to execute the relevant Refund
Guarantees and
the Consent and Agreement relating to the assignment thereof and
(ii) the
relevant Shipyard and Guangdong, as is a party to the relevant Shipbuilding
Contract, to execute any Consent and Agreement with respect to the
Assignment of
Shipbuilding Contract;
(d)
Fees
.
the
Mandated Lead Arrangers and the Administrative Agent shall have received
payment
of the fees payable under Section 14 and under the Fee Letter to
the extent that
the relevant Drawdown Notice did not instruct such fees to be paid
from the
relevant Advance;
(e)
Legal
Opinions
.
the
Administrative Agent shall have received opinions, dated the relevant
Drawdown
Date, each in form and substance reasonably satisfactory to the Administrative
Agent and its counsel, from (i) Johnson, Stokes & Master, special Hong
Kong counsel to the Administrative Agent, and (ii) Global Law Office,
special
Chinese counsel to the Administrative Agent; and
(f)
Security
Documents
.
the
Borrower shall have executed and delivered to the Administrative
Agent in
respect of the Collateral Vessel to which such Advance relates the
relevant (i)
Assignment of Shipbuilding Contract and the Assignment Notices and
Consents and
Agreements relating thereto, substantially in the form attached to
this
Agreement (ii) personal property registry financing statements in British
Columbia, and (iii) such Uniform Commercial Code Financing Statements
as the
Administrative Agent shall require, each in form and substance satisfactory
to
the Administrative Agent.
4.4
Conditions
Precedent to the Post-Delivery Advances
.
In
addition to the conditions set forth in Section 4.1, 4.2, 4.3 and
4.5 in this
Section 4, the obligations of the Lenders to make any Post-Delivery
Advance
shall be expressly subject to the following conditions precedent
on the relevant
Drawdown Date:
(a)
The
Collateral Vessel
.
the
Administrative Agent shall have received evidence satisfactory to
it and its
legal advisers that with respect to the relevant Collateral Vessel,
such
Collateral Vessel:
(i)
is
classed in the highest classification and rating for vessels of the
same age and
type with the relevant Classification Society without any material
outstanding
overdue recommendations affecting class;
| (ii) |
is
seaworthy for hull and machinery insurance warranty
purposes;
|
| (iii) |
is
in every material way fit for its contracted service under
the relevant
Time Charter;
|
| (iv) |
is
insured in accordance with the provisions of the Mortgage
thereon and the
requirements thereof in respect of such Insurances will
have been
fulfilled, more specifically is insured with respect to:
|
| (A) |
all
risks hull and machinery (including excess risks);
|
| (B) |
war
risks covering, inter alia the perils of confiscation,
expropriation,
nationalization and seizure; and
|
| (C) |
protection
and indemnity risks (including pollution risks, crew, cargo,
contractual
and removal of wreck insurance);
and
|
| (v) |
complies
with all relevant laws, regulations and requirements (including
environmental laws, regulations and requirements), statutory
or otherwise,
as are applicable to (A) vessels documented under Hong Kong flag and
(B) vessels engaged in a trade or operations similar to that
to be
performed by such Collateral Vessel, except where the failure
to so comply
would not have a material adverse effect on the operation
of such
Collateral Vessel in its intended trade or operations or
the financial
condition of the respective owners;
|
(b)
Security
Documents
.
the
Borrower shall have executed and delivered to the Administrative
Agent (i) the
Assignments of Earnings and the Assignment Notices relating thereto,
substantially in the form attached to this Agreement, (ii) Tranche
B Time
Charters Guarantee Assignment and the Assignment Notices relating
thereto,
substantially in the form attached to this Agreement, (iii) Manager’s
Undertakings, substantially in the form attached to this Agreement,
(iv) the
Assignments of Insurances and the Assignment Notices relating thereto,
substantially in the form attached to this Agreement, (v) personal property
registry financing statements in British Columbia, (vi) such Uniform
Commercial
Code Financing Statements as the Administrative Agent shall require,
and
(vii) the Mortgages with respect to the relevant Collateral Vessel ,
substantially in the form attached to this Agreement, each in form
and substance
satisfactory to the Administrative Agent;
(c)
Signatories
Authority
.
the
Administrative Agent having received such evidence of the signing
authority of
the Time Charterers and, in respect of a Tranche B Post-Delivery
Advance, the
relevant Time Charter Guarantor to execute the Facility Documents
to which they
are a party;
(d)
Insurance
.
the
Administrative Agent shall have received a favorable report from
internal
insurance advisors of the Administrative Agent confirming that the
Insurances
placed on the relevant Collateral Vessel are in compliance with the
terms of the
relevant Mortgage; and
(e)
Legal
Opinions
.
for the
first Post-Delivery Advance for each Collateral Vessel, the Administrative
Agent
shall have received legal opinions, dated the relevant Drawdown Date,
each in
form and substance reasonably satisfactory to the Administrative
Agent and its
counsel, from (i) Bull, Housser & Tupper, LLP, counsel to the Borrower
(ii) Seward & Kissel LLP, special counsel to the Administrative Agent,
Security Agent and the Lenders, (iii) Johnson, Stokes & Master, special
Hong Kong counsel to the Administrative Agent, (iv) Appleby Spurling
Hunter,
special British Virgin Island counsel to the Administrative Agent
and (v)
Global Law Office, special Chinese counsel to the Administrative
Agent.
4.5
Further
Conditions Precedent
.
The
obligation of the Lenders to make any Advance available to the Borrower
under
this Agreement shall be expressly and separately subject to the following
further conditions precedent on the relevant Drawdown Date:
(a)
Drawdown
Notice
.
the
Administrative Agent having received a Drawdown Notice in accordance
with the
terms of Section 3.3;
(b)
Bringdown
Certificate.
the
Administrative Agent having received a certificate from an officer
of the
Borrower that the certified copies of the constitutional documents
and
resolutions provided pursuant to Section 4.1(a) have not been amended
or
otherwise changed and remain in full force and effect as of the date
thereof;
(c)
Representations
and Warranties
.
the
representations stated in Section 2 (updated mutatis mutandis to such date)
being true and correct as if made on and as of that date;
(d)
Liens
.
the
Administrative Agent having received evidence reasonably satisfactory
to it and
to its legal advisers that, save for Permitted Liens and the liens
created by
the Mortgages and the Security Documents, there are no liens, charges
or
encumbrances of any kind whatsoever on the relevant Collateral Vessel,
its
earnings or insurances or on any other assets thereof except as permitted
hereby
or by any of the Security Documents;
(e)
Material
Adverse Effect
.
there
having been no Material Adverse Effect, since the date hereof;
(f)
No
Event of Default
.
no
Event of Default, or event which with the passing of time or the
giving of
notice, or both, would constitute an Event of Default shall have
occurred and be
continuing and the Administrative Agent shall have received a certificate
from
an officer of the Borrower to such effect;
(g)
No
Change in Laws
.
the
Administrative Agent being satisfied that no change in any applicable
laws,
regulations, rules or in the interpretation thereof shall have occurred
which
make it unlawful for the Borrower to make any payment as required
under the
terms of this Agreement, the Note, the Security Documents or any
of them;
(h)
Legality
.
the
Administrative Agent being satisfied that no Event of Default will
arise
following the making of the initial Pre-Delivery Advance and that
no event or
state of affairs exists which constitutes, in the reasonable opinion
of the
Administrative Agent, would make it unlawful for the Borrower to
make any
payment as required under the terms of this Agreement, the Note and
the Security
Documents or any of them; and
(i)
Environmental
Claims
.
the
Administrative Agent shall be satisfied that neither the Borrower
nor the
Manager is subject to any Environmental Claim which is reasonably
likely to have
a Material Adverse Effect.
4.6
Conditions
Subsequent to Post-Delivery Advances
.
The
Borrower shall procure that on the Delivery Date of the respective
Collateral
Vessel and on any Drawdown Date subsequent to such Delivery Date
:
(a)
The
Collateral Vessel
.
the
Administrative Agent shall have received evidence satisfactory to
it and its
legal advisers that with respect to the relevant Collateral Vessel,
such
Collateral Vessel:
| (i) |
is
in the sole and absolute ownership of the Borrower, unencumbered
save and
except for the Mortgage thereon in favor of the Security
Agent and
Permitted Liens, and is duly registered in the name of
the Borrower under
the flag of Hong Kong; and
|
| (ii) |
has
been accepted for service by the relevant Time Charterer
under the
applicable Time Charter and such Time Charter is in full
force and effect;
and
|
(b)
Recording
of the Collateral Vessel Mortgage
.
The
Administrative Agent shall have received satisfactory evidence that
the relevant
Statutory Mortgage has been duly executed and recorded under the
laws of Hong
Kong, and constitutes a first priority mortgage or lien on the relevant
Collateral Vessel under the laws of Hong Kong.
4.7
Breakfunding
Indemnity
.
In the
event that, on the date specified for making available any Advances
hereunder in
the notice requesting the same given pursuant to Section 3.3, the
Lenders shall
not be obliged under this Agreement to make an Advance available
under this
Agreement, the Borrower shall indemnify and hold the Lenders fully
harmless
against any
losses
which the Lenders may sustain as a result of borrowing or agreeing
to borrow
funds to meet the drawdown requirement in respect thereof and the
certificate of
the Administrative Agent shall (save and except for manifest error)
be
conclusive and binding on the Borrower as to the extent of any losses
sustained
by the Lenders.
4.8
Satisfaction
after Drawdown
.
Without
prejudice to any of the other terms and conditions of this Agreement,
in the
event that the Lenders, in their sole discretion, make any Advances
available to
the Borrower prior to the satisfaction of all or any of the conditions
referred
to elsewhere in this Section 4, the Borrower hereby covenants and
undertakes to satisfy or procure the satisfaction of such condition
or
conditions within fourteen (14) days, except to the extent that such
conditions
have been waived in writing by the Administrative Agent on behalf
of the
Lenders.
| 5. |
REPAYMENT
AND PREPAYMENT.
|
5.1
Reductions
of the Facility
.
Subject
to the following provisions of this Section 5, the Available Amount
shall be
reduced on the relevant Reduction Date in accordance with Schedule
2 hereto and
on the Final Payment Date to zero. On each Reduction Date, each Lender’s
Commitment shall be reduced by an amount equal to the proportion
of the amount
by which the Available Amount is to be so reduced on that date which
its
Commitment bears to the total Commitments on that date. The Administrative
Agent
shall notify the Borrower and the Lenders of any change in the amount
of any
reduction set out in Schedule 2 or the timing of any such reduction
as a result
of: (a) any Collateral Vessel not being delivered on or before the
last day of
the relevant Pre-Delivery Advances Availability Period, in which
case the
relevant Tranche relating thereto shall be reduced proportionately,
(b) if,
prior to the first Reduction Date, the Facility is not fully drawn
by the
Borrower, (c) a prepayment of any Advance or cancellation of any
undrawn portion
of the Facility contemplated in this Section 5, or (d) any other
event
contemplated in this Agreement that necessitates such change in the
amount or
timing of a reduction set out in Schedule 2. Upon approval of the
Majority
Lenders, the Administrative Agent will replace the Schedule 2 with
a new
reduction schedule reflecting the correct reduction amounts or Reduction
Dates
and will promptly provide a copy thereof to the Borrower and the
Lenders.
5.2
Repayment
.
Subject
to the provisions of this Section 5 regarding application of prepayments,
the Borrower shall, on each Reduction Date, repay that amount necessary
to
reduce the outstanding aggregate amount of each Tranche to an amount
that is not
more than the then Available Amount and, on the Final Payment Date,
the Borrower
shall repay the then aggregate outstanding amount of the relevant
Tranche. If at
any time the aggregate outstanding Advances under the Facility exceeds
the total
Commitments at such time, the Borrower shall immediately repay (together
with
the costs and expenses provided for in Section 5.10) an amount equal
to such
excess.
5.3
Voluntary
Prepayment; Re-borrowing
.
The
Borrower may, from time to time, prepay, upon three (3) Banking Days
written
notice, any outstanding Advance or any portion thereof, without penalty,
provided that if such prepayment is made on a day other than the
last day of the
Interest Period of such Advance such prepayment shall be made together
with the
costs and expenses provided for in Section 5.10. Each prepayment
shall be in a
minimum amount of Two Million Dollars ($2,000,000) and shall be in
an integral
multiple of One Million Dollars ($1,000,000) or the full amount of
the then
outstanding Advances. Subject to the limits and upon the conditions
herein
provided (including the reductions of the Commitments provided in
Section 5.1),
the Borrower may from time to time, up until the day prior to the
Final Payment
Date, prepay the Advances or a portion thereof and thereafter re-borrow
such
Advances or a portion thereof up to the then Available Amount.
5.4
Optional
Cancellation/Permanent Reduction of Facility
.
(a)
The
Borrower may, from time to time, by giving not less than three (3)
Banking Days'
prior notice to the Administrative Agent, cancel the undrawn portion
of the
Commitments in whole or in part. Partial cancellation of the undrawn
Commitments
must be in a minimum amount of US$5,000,000 and in integral multiples
of
US$1,000,000 or the full amount of the undrawn Commitment. Any cancellation
in
whole or in part will be applied against Tranche A and Tranche B,
or either of
them, as instructed by the Borrower but any such application shall
be applied
against the Commitment of the Lenders
pro
rata
.
(b)
The
Borrower shall have the right, at any time and from time to time,
to, without
penalty, permanently reduce the Facility, provided that the Administrative
Agent
receives three (3) Banking Days prior written notice of such reduction
and the
Lenders are reimbursed for any Breakfunding Costs with respect to
any Advances,
or portions thereof, that are prepaid on any day other than the last
day of the
applicable Interest Period(s) in the event that such prepayment is
necessary to
reduce the aggregate outstanding Advances under the Facility to the
then
Available Amount after giving effect to any such permanent reduction
in the
Facility. Each such permanent reduction shall be equal to or shall
exceed Five
Million Dollars ($5,000,000) and shall be in an integral multiple
of One Million
Dollars ($1,000,000) or the full amount of the then outstanding Advances.
The
optional permanent commitment reductions pursuant to this Section
shall be
applied against the remaining scheduled reductions in the order of
maturity. The
Borrower shall make a prepayment of the Advances in an amount equal
to that
amount necessary to reduce the outstanding aggregate amount of the
Facility to
an amount equal to the Available Amount as reduced pursuant to the
previous
sentence and to the extent required to be in compliance with Section
5.2 or, if
applicable, Section 8. No amounts repaid or prepaid pursuant to this
Section 5.4
shall be available for reborrowing.
5.5
Mandatory
Reduction: Sale, Loss or Non-delivery
.
Unless
the Borrower has provided for the delivery of a Substitute Vessel
and such
Substitute Vessel is time-chartered under a Time Charter or a time
charter with
a time charterer acceptable to the Lenders, with a term extending
at least to
the relevant Final Payment Date and (i) the Borrower has executed,
delivered and
registered all Security Documents in connection therewith, and (ii)
the Security
Agent has been provided with any legal opinions requested thereby
in connection
therewith, no later than 91 days after the date of (a) any sale of a
Collateral Vessel or (b) the Total Loss of a Collateral Vessel, or
upon
cancellation of a Shipbuilding Contract or the failure of the Borrower
to
declare any of the options on the last four of the Tranche B Collateral
Vessels
by June 30, 2006, the relevant Tranche shall be permanently reduced
by an amount
equal to such Tranche
multiplied
by the Repayment Ratio. The Borrower shall prepay any outstanding
principal of
the Facility to the extent required to comply with the reduction
set forth
above. Mandatory reductions of any Tranche shall be applied against
the
remaining reductions of such Tranche on a pro-rata basis.
5.6
Mandatory
Prepayment: Illegality
.
(a)
If
it
becomes, or to the knowledge of any Lender is to become, unlawful
in any
jurisdiction for a Lender to perform any of its obligations as contemplated
by
this Agreement or any Facility Document or to fund or maintain its
share in one
or more of the Advances (the “Event of Illegality”), that Lender shall notify
the Administrative Agent and the Borrower.
(b)
After
notification under paragraph
(a)
above
,
the
Borrower and that Lender shall thereafter consult with each other
and use
reasonable commercial efforts for a period of thirty (30) days or
in the event
that the Event of Illegality takes effect before the expiration of
thirty (30)
days, for the maximum number of days available before the Event of
Illegality
takes effect with a view to restructuring the Facility in such a
way as to avoid
the effect of the Event of Illegality.
(c)
If
agreement cannot be reached between the parties within the period
specified in
paragraph
(b)
above
:
| (i) |
the
Borrower shall repay the share of that Lender in the Advances
on the date
specified in paragraph
(d)
below
to
the extent required to resolve the illegality;
and
|
| (ii) |
the
Commitment of that Lender will be immediately
cancelled.
|
(d)
The
date
for repayment of a Lender's share in an Advance or Advances as a
result of an
Event of Illegality will be:
| (i) |
the
last day of the current Interest Period of the relevant
Advance;
or
|
| (ii) |
if
earlier, the date specified by that Lender in the notice
delivered to the
Borrower (being no earlier than the last day of any applicable
grace
period permitted by applicable
law).
|
5.7
[INTENTIONALLY
OMITTED]
5.8
Mandatory
Prepayment: Change of Control of any Time Charterer
.
(a)
The
Borrower must promptly notify the Administrative Agent if it becomes
aware of
any person or group of persons acting in concert gaining control
of any Time
Charterer, be it direct or indirect.
(b)
If,
after
notification under paragraph
(a)
above
or if
the Administrative Agent otherwise becomes aware of the same in respect
of the
Time Charterer, the Administrative Agent (acting on the instructions
of all of
the Lenders, such instructions to be given reasonably) considers
that the change
of control of the Time Charterer has, or is reasonably likely when
it takes
effect to have, a Material Adverse Effect, the Administrative Agent
shall
promptly notify the Borrower of such conclusion and the provisions
of the
balance of this Section 5.8 shall have effect.
(c)
After
notification under paragraph (b) above, the Borrower shall have six
(6) months
to obtain a suitable substitute charterer, such substitute charterer
to be
satisfactory in all respects to all of the Lenders.
(d)
Such
substitute charterer must enter into any and all documents equivalent
in all
material respects to the documents currently existing and entered
into by the
relevant Time Charterer, or such other documents as are acceptable
to the
Lenders.
(e)
If
the
Borrower is unable to obtain a suitable substitute charterer in accordance
with
the terms of this Section 5.8, the Borrower shall immediately prepay
all
outstanding Advances in relation to the Collateral Vessels under
charter with
the relevant Time Charterer.
(f)
In
paragraph
(a)
above
:
“control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a person,
whether
through the ownership of voting stock, by contract or otherwise by
applicable
law, and “controls” and “controlled” shall be construed in like
manner;
5.9
Mandatory
prepayment: Termination, Charter Breach or Expiration of Charter
.
Unless
the Borrower complies with the provisions of Section 9.4(c) and enters
into an
acceptable substitute time charter or the Administrative Agent receives
additional security reasonably satisfactory to the Administrative
Agent (acting
on the instructions of the Majority Lenders), upon the termination,
Charter
Breach, or expiration of a Time Charter, the Borrower shall prepay
within 91
days of such expiration, Charter Breach, or termination an amount
of the
relevant Tranche relating to such Collateral Vessel to ensure that
the aggregate
of the Fair Market Value of all of the Collateral Vessels actually
delivered in
respect of the relevant Tranche is not less than 125% of the aggregate
principal
amount of the outstanding Advances in respect of such Collateral
Vessels.
5.10
Interest
and Costs with Prepayments/Application of Prepayments
.
(a)
Any
prepayment of the Facility made hereunder (including, without limitation,
those
made pursuant to Sections 5 and 8) shall be subject to the condition
that on the
date of prepayment all accrued interest to the date of such prepayment
shall be
paid in full with respect to the Facility or portions thereof being
prepaid,
together with any Breakfunding Costs (as certified by such Lender,
which
certification shall, absent any manifest error, be conclusive and
binding on the
Borrower).
(b)
All
prepayments of the Facility under this Section 5 shall be applied
towards the
remaining installments of the Tranches on a pro-rata basis.
(c)
Each
and
every payment made on account of principal under the Facility to
reduce the
outstanding aggregate amount of each Tranche will be allocated: (a)
in the case
of the payments made to reduce the outstanding aggregate amount of
Tranche A,
first to 25% of the first Advance of Tranche A and thereafter, sequentially,
to
25% of each subsequent Advance of Tranche A until 25% of the principal
amount of
each Advance of Tranche A has been paid, and thereafter to the remaining
principal amount of Tranche A until the principal amount of Tranche
A has been
repaid; and (b) in the case of the payments made to reduce the outstanding
aggregate amount of Tranche B, first to 25% of the first Advance
of Tranche B
and thereafter, sequentially, to 25% of each subsequent Advance of
Tranche B
until 25% of the principal amount of each Advance of Tranche B has
been paid,
and thereafter to the remaining principal amount of the Tranche B
until the
principal amount of Tranche B has been repaid, provided that the
Borrower may,
upon giving written notice to the Administrative Agent, request that
any payment
on account of principal to reduce the outstanding aggregate amount
of either
Tranche A or Tranche B be allocated otherwise than as set out
above.
| 6. |
INTEREST
AND RATE
|
6.1
Applicable
Rate
.
Each
Advance shall bear interest at the Applicable Rate, which shall be
the rate per
annum which is equal to the aggregate of (a) LIBOR for the relevant
Interest Period plus (b) the Margin. The Applicable Rate shall be
determined by the Administrative Agent two (2) Banking Days prior
to the first
(1
st
)
day of
the relevant Interest Period and the Administrative Agent shall promptly
notify
the Borrower in writing of the Applicable Rate as and when determined.
Each such
determination, absent manifest error, shall be conclusive and binding
upon the
Borrower.
6.2
Default
Rate
.
Any
amounts due under this Agreement, not paid when due, whether by acceleration
or
otherwise, shall bear interest thereafter from the due date thereof
until the
date of payment at a rate per annum equal to the greater of (i) the
Applicable Rate, plus two percent (2.0%) per annum or (ii) LIBOR
for overnight
or weekend deposits, as the case may be, plus the Margin plus two
percent (2.0%)
per annum (the “Default Rate”).
6.3
Interest
Periods
.
The
Borrower shall give the Administrative Agent an Interest Notice specifying
the
Interest Period selected at least three (3) Banking Days prior to the end
of any then existing Interest Period, which notice the Administrative
Agent
agrees to forward on to all Lenders on a same day basis or as soon
as
practicable. If at the end of any then existing Interest Period the
Borrower
fails to give an Interest Notice, the relevant Interest Period shall
be three
(3) months. The Borrower's right to select an Interest Period shall
be subject
to (i) the limitations set forth in Section 12.2 hereof and (ii)
the restriction
that no selection of an Interest Period shall be effective unless
no Event of
Default or event which, with the giving of notice or lapse of time,
or both,
would constitute an Event of Default shall have occurred and be continuing.
No
more than twenty-four (24) Interest Periods shall be outstanding
at any one
time; provided, however, that the Borrower and the Administrative
Agent may
agree to consolidate Interest Periods from various Advances in order
to
accommodate this provision. The Borrower shall reimburse the Lenders
for any and
all Breakfunding Costs (as certified by such Lender, which certification
shall,
absent any manifest error, be conclusive and binding on the Borrower)
as a
consequence of such consolidation or otherwise.
6.4
Interest
Payments
.
Accrued
interest on the Facility shall be payable in arrears on the last
day of each
Interest Period, except that if the Borrower shall select an Interest
Period in
excess of three (3) months, accrued interest shall be payable during
such
Interest Period on each three (3) month anniversary of the commencement
of such
Interest Period and upon the end of such Interest Period.
| 7. |
PAYMENTS.
|
7.1
Place
of Payments; No Set Off
.
All
payments to be made hereunder by the Borrower shall be made to the
Administrative Agent, not later than 12 p.m. New York time (any payment
received
after 12 p.m. New York time shall be deemed to have been paid on
the next
Banking Day) on the due date of such payment, at its office located
at 200 Park
Avenue, 31
ST
Floor,
New York, New York 10166, USA or to such other office of the Administrative
Agent as the Administrative Agent may direct, without set-off or
counterclaim
and free from, clear of, and without deduction or withholding for,
any Taxes,
provided, however, that if the Borrower shall at any time be compelled
by law to
withhold or deduct any Taxes from any amounts payable to the Lenders
hereunder,
then the Borrower shall pay such additional amounts in Dollars as
may be
necessary in order that the net amounts received after withholding
or deduction
shall equal the amounts which would have been received if such withholding
or
deduction were not required and, in the event any withholding or
deduction is
made, whether for Taxes or otherwise, the Borrower shall promptly
send to the
Administrative Agent such documentary evidence with respect to such
withholding
or deduction as may be required from time to time by the Lenders.
7.2
Tax
Credits
.
If any
Lender obtains the benefit of a credit against the liability thereof
for Taxes
imposed by any taxing authority for all or part of the Taxes as to
which the
Borrower has paid additional amounts as aforesaid, then such Lender
shall pay an
amount to the Borrower which that Lender determines will leave it
(after such
payment) in the same position as it would have been had the Tax payment
not been
made by the Borrower. Each Lender agrees that in the event that Taxes
are
imposed on account of the situs of its loans hereunder, such Lender,
upon
acquiring knowledge of such event, shall, if commercially reasonable
and if, in
the opinion of that Lender, is not prejudicial to it, shift such
loans on its
books to another office of such Lender so as to avoid the imposition
of such
Taxes. Nothing contained in this clause shall in any way prejudice
the right of
the Lenders to arrange their tax affairs in such way as they, in
their sole
discretion, deem appropriate. In particular, no Lender shall be required
to
obtain such tax credit, if this interferes with the way such Lender
normally
deals with its tax affairs.
7.3
Lender
Assignment
.
If (a)
a Lender assigns or transfers any of its rights and obligations under
the Credit
Agreement under Section 11; (b) a Lender changes its facility office;
or (c) if
the Administrative Agent changes its office pursuant to Section 7.1,
and such
assignment, transfer or change requires the Borrower to make a deduction
or
withholding for or on account of Taxes with respect to any payment
under a
Facility Document or to pay any increased costs pursuant to Section
12.2, the
Borrower will not obliged to make such deduction or withholding or
pay such
increased costs.
7.4
Sharing
of Setoffs
.
Each
Lender agrees that if it shall, through the exercise of a right of
banker’s
lien, setoff or counterclaim or pursuant to a secured claim under
Section 506 of
the Federal Bankruptcy Code or other security or interest arising
from, or in
lieu of, such secured claim, exercised or received by such Lender
under any
applicable bankruptcy, insolvency or other similar law or otherwise,
or by any
other means, obtain payment (voluntary or involuntary) in respect
of the
Facility as a result of which its funded Commitment shall be proportionately
less than the funded Commitment of any other Lender, it shall be
deemed
simultaneously to have purchased from such other Lender at face value,
and shall
promptly pay to such other Lender the purchase price for, a participation
in the
funded Commitment of such other Lender so that the aggregate funded
Commitment
of each Lender shall be in the same proportion to the aggregate funded
Commitments then outstanding as its funded Commitment prior to such
exercise of
banker’s lien, setoff or counterclaim or other event was to the principal
amount
of all funded Commitments outstanding prior to such exercise of banker’s lien,
setoff or counterclaim or other event;
provided
,
however
,
that,
if any such purchase or purchases or adjustments shall be made pursuant
to this
Section 7.4 and the payment giving rise thereto shall thereafter
be recovered,
such purchase or purchases or adjustments shall be rescinded to the
extent of
such recovery and the purchase price or prices or adjustment restored
without
interest. Any Lender holding a participation in a funded Commitment
deemed to
have been so purchased may exercise any and all rights of banker’s lien, setoff
or counterclaim with respect to any and all monies owing to such
Lender by
reason thereof as fully as if such Lender had made an advance in
the amount of
such participation. The Borrower expressly consents to the foregoing
arrangement.
7.5
Computations;
Banking Day
.
(a)
All
computations of interest and fees shall be made by the Administrative
Agent or
the Lenders, as the case may be, on the basis of a 360-day year,
in each case
for the actual number of days (including the first day but excluding
the last
day) occurring in the period for which interest or fees are payable.
Each
determination by the Administrative Agent or the Lenders of an interest
rate or
fee hereunder shall be conclusive and binding for all purposes, absent
manifest
error.
(b)
Whenever
any payment hereunder or under the Note shall be stated to be due
on a day other
than a Banking Day, such payment shall be due and payable on the
next succeeding
Banking day unless the next succeeding Banking Day falls in the following
calendar month, in which case it shall be payable on the immediately
preceding
Banking Day.
| 8. |
EVENTS
OF DEFAULT.
|
8.1
Events
of Default
.
The
occurrence of any of the following events shall be an Event of
Default:
(a)
Non-payment
.
The
Borrower does not pay on the due date any amount payable by it under
the
Facility Documents in the manner required under the Facility Documents,
unless
the non-payment:
| (i) |
is
caused by technical or administrative error;
and
|
| (ii) |
is
remedied within three (3) Banking Days of the due date;
or
|
| (b) |
Breach
of other obligations
.
Any of the following occurs in respect of the
Borrower:
|
(i)
The
Borrower defaults in the performance of any term, covenant (including
but not
limited to the covenants contained in Section 9 hereof) or agreement
contained
in this Agreement, the Note, any Hedge Agreement, the Security Documents
or any
of them, or any other instrument, document or agreement delivered
in connection
herewith or therewith, or there occurs any other event which constitutes
a
default under this Agreement, the Note, any Hedge Agreement or any
of the
Security Documents other than an Event of Default referred to elsewhere
in this
Section 8, and such default is, in the opinion of the Administrative
Agent,
capable of remedy, and continues unremedied for a period of thirty (30)
days after written notice; or
(ii)
the
Borrower fails to comply with the provisions of Section 4.8 (to the
extent
applicable) or breaches any covenant to maintain (A) the registration of
any Mortgage or Security Document in a first priority and perfected
position,
(B) the registration of any Collateral Vessel, (C) the Insurances
required under any Mortgage or (D) the financial covenants of Section 9.3,
provided
always
that,
in
the case of the foregoing (A) and (B), if the non-compliance is caused
by
technical or administrative error only, is corrected within three
(3) Banking
Days of the earlier of the Administrative Agent giving notice to
the Borrower
and discovery by the Borrower (for the purpose of this paragraph
“discovery”
means actual awareness), and, in the case of the foregoing (C) ,
if the
non-compliance is caused by technical or administrative error only,
is corrected
within one (1) Banking Day and in each case the Administrative Agent
(acting on
the good faith and reasonable instructions of the Majority Lenders)
is satisfied
that the Creditors have neither suffered nor will, in the future,
suffer any
material detriment (whether financial, to their security position
or otherwise
howsoever) as a result of the non-compliance; or
(iii)
Any
Party
(other than the Borrower or a Creditor) does not comply with any
terms of the
Facility Documents which the Administrative Agent (acting on the
good faith and
reasonable instructions of the Majority Lenders) considers to be
material,
unless the non-compliance:
| (A) |
is
capable of remedy; and
|
| (B) |
is
remedied within fourteen (14) days of the earlier of the
Administrative
Agent giving notice and discovery by the relevant Party
(“discovery”
having the same meaning as in Section 8.1(b)(ii));
or
|
(c)
Misrepresentation.
A
representation made or repeated by the Borrower (or by any other
Party other
than a Creditor) in any Facility Document or in any document delivered
by or on
behalf of the Borrower under any Facility Document is incorrect in
any respect
which the Administrative Agent (acting on the good faith and reasonable
instructions of the Majority Lenders) considers to be material when
made or
deemed to be repeated, unless the circumstances giving rise to the
misrepresentation:
(d)
are
capable of remedy; and
| (i) |
are
remedied within thirty (30) days of the earlier of the
Administrative
Agent giving notice and the relevant Party becoming aware
of the
misrepresentation; or
|
(d)
Cross-default
.
Any of
the following occurs in respect of the Borrower:
| (i) |
any
of its Indebtedness is not paid when due (after the expiry
of any
originally applicable grace
period);
|
| (ii) |
any
of its Indebtedness:
|
| (A) |
becomes
prematurely due and payable;
|
| (B) |
is
placed on demand;
|
| (C) |
is
capable of being declared by a creditor to be prematurely
due and payable
prior to its scheduled repayment date or being placed on
demand;
|
| (D) |
in
each case, as a result of an event of default (howsoever
described) and
after the expiry of any applicable grace period;
or
|
| (iii) |
any
commitment for its Indebtedness is cancelled or suspended
as a result of
an event of default (howsoever described),
|
unless
the aggregate amount of Indebtedness falling within paragraphs
(i)
to (iii)
above is less than Twenty Five Million Dollars ($25,000,000) or its
equivalent ;
or
(e)
Insolvency
.
Any of
the following occurs in respect of the Borrower:
| (i) |
it
is, or is deemed for the purposes of any applicable law
to be, unable to
pay its debts as they fall due or
insolvent;
|
| (ii) |
it
admits its inability to pay its debts as they fall
due;
|
| (iii) |
it
suspends making payments on any of its debts or announces
an intention to
do so;
|
| (iv) |
by
reason of actual or anticipated financial difficulties,
it begins
negotiations with any creditor for the rescheduling of
any of its
indebtedness; or
|
| (v) |
a
moratorium is declared in respect of any of its
indebtedness.
|
If
a
moratorium occurs in respect of the Borrower, the ending of the
moratorium will
not remedy any Event of Default caused by the moratorium; or
(f)
Insolvency
proceedings
.
| (i) |
Except
as provided in paragraph
(ii)
below
,
any of the following occurs in respect of the
Borrower:
|
| (A) |
The
Borrower files a petition for reorganization or liquidation
in bankruptcy
or any step is taken with a view to a moratorium, a composition,
assignment or similar arrangement with any of its
creditors;
|
| (B) |
a
meeting of its shareholders, directors or other officers
is convened for
the purpose of considering any resolution to petition for
or to file
documents with a court for its reorganization, liquidation,
winding-up,
administration or dissolution or any such resolution is
passed;
|
| (C) |
any
person presents a petition, or files documents with a court
for the
Borrower’s reorganization, liquidation, winding-up, administration
or
dissolution;
|
| (D) |
an
order for its reorganization, liquidation, winding-up,
administration or
dissolution is made;
|
| (E) |
any
liquidator, trustee in bankruptcy, judicial custodian,
compulsory manager,
receiver, administrative receiver, administrator or similar
officer is
appointed in respect of it or any of its
assets;
|
| (F) |
its
directors, shareholders or other officers request the appointment
of, or
give notice of their intention to appoint a liquidator,
trustee in
bankruptcy, judicial custodian, compulsory manager, receiver,
administrative receiver, administrator or similar officer;
or
|
| (G) |
any
other analogous step or procedure is taken in any
jurisdiction.
|
| (ii) |
Paragraph
(i)
above
does not apply to a petition for reorganization, liquidation
or winding-up
presented by a creditor which is discharged within fourteen
(14)
days
;
or
|
(g)
Creditors'
process
.
Any
attachment, sequestration, distress, execution or analogous event
affects any
asset(s) of the Borrower, having an aggregate value of Twenty Five
Million
Dollars ($25,000,000) or its equivalent and is not discharged within
thirty (30)
days; or
(h)
Cessation
of business
.
The
Borrower ceases, or threatens to cease, to carry on business except
as a result
of any disposal not prohibited under this Agreement; or
(i)
Failure
to pay final judgment
.
The
Borrower fails to comply with or pay any sum due from it under any
final
judgment or any final order made or given by any court of competent
jurisdiction; or
(j)
Effectiveness
of Facility Documents
.
| (i) |
It
is or becomes unlawful for the Borrower or any other Party
(other than a
Creditor) to perform any of its material obligations under
the Facility
Documents;
|
| (ii) |
Any
material provision of a Facility Document is not effective
or is alleged
by the Borrower to be ineffective for any
reason;
|
| (iii) |
Any
material provision of a Facility Document is not effective
or is alleged
by any Party (other than a Creditor or the Borrower) to
be ineffective for
any reason;
|
| (iv) |
The
Borrower repudiates any material provision of a Facility
Document or
evidences an intention to repudiate any material provision
of a Facility
Document; or
|
| (v) |
Any
Party (other than a Creditor) repudiates any material provision
of a
Facility Document or evidences an intention to repudiate
any material
provision of a Facility Document;
or
|
(k)
Invalidity
of Security Documents
.
Any of
the Security Documents ceases to be valid in any material respect
or any of
those Security Documents creating a Security Interest in favour of
the
Administrative Agent ceases to provide a perfected first priority
security
interest in favour of the Administrative Agent; or
(l)
Change
of Control
.
A
Change of Control shall occur.
Upon
and
during the continuance of any Event of Default, the Lenders’ obligation to make
the Facility available shall cease and the Administrative Agent,
on the
instructions of the Majority Lenders shall, by notice to the Borrower,
declare
the entire unpaid balance of the Facility, accrued interest and any
other sums
payable by the Borrower hereunder or under the Note due and payable,
whereupon
the same shall forthwith be due and payable without presentment,
demand, protest
or notice of any kind, all of which are hereby expressly waived;
provided that
upon the happening of an event specified in subsections (e) or (f) of this
Section 8.1 with respect to the Borrower, the Note shall be immediately due
and payable without declaration or other notice to the Borrower.
In such event,
the Lenders may proceed to protect and enforce their rights by
action
at
law, suit in equity or in admiralty or other appropriate proceeding,
whether for
specific performance of any covenant contained in this Agreement,
in the Note or
in any Security Document, or in aid of the exercise of any power
granted herein
or therein, or the Lenders may proceed to enforce the payment of
the Note or to
enforce any other legal or equitable right of the Lenders, or proceed
to take
any action authorized or permitted under the terms of any Security
Document or
by applicable law for the collection of all sums due, or so declared
due, on the
Note. Without limiting the foregoing, the Borrower agrees that during
the
continuance of any Event of Default each of the Lenders shall have
the right to
appropriate and hold or apply (directly, by way of set-off or otherwise)
to the
payment of the obligations of the Borrower to the Lenders hereunder
and/or under
the Note (whether or not then due) all monies and other amounts of
the Borrower
then or thereafter in possession of any Lender pursuant to any Facility
Document, the balance of any deposit account (demand or time, mature
or
unmatured) of the Borrower then or thereafter with any Lender held
pursuant to
any Facility Document and every other claim of the Borrower then
or thereafter
against any of the Lenders pursuant to any Facility Document.
8.2
Indemnification
.
The
Borrower agrees to, and shall, indemnify and hold the Creditors harmless
against
any loss, as well as against any costs or expenses (including legal
fees and
expenses), which any Creditor sustains or incurs as a consequence
of any default
in payment of the principal amount of the Facility, interest accrued
thereon or
any other amount payable hereunder, under the Note or under any Security
Documents, including, but not limited to, all actual losses incurred
in
liquidating or re-employing fixed deposits made by third parties
or funds
acquired to effect or maintain the Facility or any portion thereof.
Any
Creditor’s certification of such costs and expenses shall, absent any manifest
error, be conclusive and binding on the Borrower.
8.3
Application
of Monies
.
Except
as otherwise provided in any Security Document, all monies received
by the
Administrative Agent, the Security Agent or the Lenders under or
pursuant to
this Agreement, the Note or any of the Security Documents after the
happening of
any Event of Default (unless cured to the satisfaction of the Majority
Lenders)
shall be applied by the Administrative Agent in the following
manner:
| (i) |
first,
in or towards the payment or reimbursement of any expenses
or liabilities
incurred by the Administrative Agent or the Security Agent
in connection
with the ascertainment, protection or enforcement of their
respective
rights and remedies hereunder and under the Note and under
the Security
Documents;
|
| (ii) |
secondly
in or towards payment of any interest owing in respect
of the Facility
then outstanding;
|
| (iii) |
thirdly
in or towards repayment of the principal amount of the
Facility then
outstanding;
|
| (iv) |
fourthly
in or towards payment of all other sums which may be owing
to the
Creditors under this Agreement, the Note and the Security
Documents or any
of them;
|
| (v) |
fifthly,
in or towards the payments of any amounts then owed under
any Hedge
Agreement; and
|
| (vi) |
sixthly,
the surplus (if any) shall be paid to the Borrower or to
whomsoever else
may be entitled thereto.
|
| 9. |
COVENANTS.
|
9.1
Affirmative
Covenants
.
The
Borrower hereby covenants and undertakes with the Creditors that,
from the date
hereof and so long as any principal, interest or other monies are
owing in
respect of the Facility or under this Agreement, the Note, the Security
Documents or any of them, the Borrower will:
(a)
Corporate
Existence
.
Maintain its corporate existence and remain duly organized and validly
existing
and in good standing under the laws of the jurisdiction of its incorporation
or
formation, as the case may be, and obtain and promptly renew from
time to time,
and promptly furnish certified copies to the Administrative Agent
of, all such
authorizations, approvals, consents and licenses as may be required
under any
applicable law or regulation to enable it to perform its obligations
under this
Agreement, the Note and the Security Documents to which it is a party
or
required for the validity or enforceability thereof or required to
enable it to
continue to own the Collateral Vessels, and it shall comply with
the terms of
the same;
(b)
Performance
of Obligations
.
Duly
perform and observe, and procure the observance and performance by
all other
parties thereto (other than the Creditors) of the terms of this Agreement, the
Note and the Facility Documents;
(c)
Events
of Default
.
Promptly inform the Administrative Agent of any occurrence of which
it becomes
aware (i) which constitutes or, with the giving of notice or lapse of time
or both, would constitute, an Event of Default or (ii) which in its
reasonable opinion, might adversely affect its ability, or the ability
of any
other party thereto, to perform its obligations under this Agreement,
the Note
and the Security Documents or any of them;
(d)
Further
Acts
.
Without
prejudice to Section 2 and this Section 9.1, obtain every consent
and do all
other acts and things which the Administrative Agent may from time
to time
reasonably request for the continued due performance of all its and
any other
Party's (other than the Creditors) respective obligations under this
Agreement,
the Note and the Facility Documents;
(e)
Financial
Information
.
Deliver
to the Administrative Agent:
| (i) |
as
soon as available but not later than ninety (90) days after
the end of
each fiscal year of the Borrower, complete copies of the
audited financial
statements thereof, all in reasonable detail, which shall
include at least
a balance sheet as of the end of such year, an income statement
and a
statement of sources and uses of funds for
such
year which shall be prepared by an Acceptable Accounting
Firm;
|
| (ii) |
as
soon as available, but not later than sixty (60) days after
the end of
each quarter of each fiscal year of the Borrower, quarterly
interim
balance sheets and the related profit and loss statements
and sources and
uses of funds (together with a Compliance Certificate),
certified to be
true and complete by the chief financial officer
thereof;
|
| (iii) |
concurrently
with each delivery of financial statements pursuant to
subparagraphs (i)
and (ii) of this sub-section (e), a certificate from the
chief financial
officer of the Borrower stating that he has reviewed the
provisions of
this Agreement, the Note and each of the Security Documents,
and the
performance or observance by Borrower thereof, and either
stating that to
his knowledge no event has occurred and no condition exists
which
constitutes or with the giving of notice or lapse of time,
or both, would
constitute an Event of Default under this Agreement or,
if any such event
has occurred or condition exists specifying the nature
and period of
existence of such event or condition of which he has knowledge
and what
action the Borrower
is
taking or
proposes
to take with respect thereto; and
|
| (iv) |
copies
of (A) the annual audited financial statements and semi-annual
financial
statements of CSCL and COSCO Holdings and (B) the annual
financial
statements and semi-annual financial statements of the
Tranche B Time
Charterer and CSCL (Hong Kong), for the relevant financial
period as soon
as such statements become publicly available, and if such
statements are
not made publicly available, then within 120 days of end
of the relevant
financial period.
|
(f)
Compliance
with Law
.
Do, or
cause to be done all things necessary to (i) be in all material respects
in
compliance with all Environmental Approvals required to operate its
business as
then being conducted, and (2) comply with all applicable laws, and
the rules and
regulations thereunder, in all material respects, including, without
limitation,
Environmental Laws and comply with those laws, rules and regulations
relating to
employee benefit plans;
(g)
Environmental
Matters
.
Promptly upon the occurrence of any of the following conditions,
provide to the
Administrative Agent a certificate of a chief executive officer thereof,
specifying in detail the nature of such condition and its proposed
response or
the response of its Environmental Affiliates: (i) its receipt or the
receipt by its Environmental Affiliates of any written communication
whatsoever
that alleges that the Borrower or any Environmental Affiliate is
not in
compliance with any applicable Environmental Law or Environmental
Approval, if
such noncompliance could reasonably be expected to have a Material
Adverse
Effect, (ii) knowledge by it, or any of its Environmental Affiliates that
there exists any Environmental Claim pending or threatened against
the Borrower
or any Environmental Affiliate, which could reasonably be expected
to have a
Material Adverse Effect, or (iii) knowledge by it of any release, emission,
discharge or disposal of any material that could form the basis of
any
Environmental Claim against it or any of its Environmental Affiliates
if such
Environmental Claim could reasonably be expected to have a Material
Adverse
Effect. Upon the written request of the Administrative Agent, it
will submit to
the Administrative Agent at reasonable intervals, a report providing
an update
of the status of any issue or claim identified in any notice or certificate
required pursuant to this subsection. For the purposes of this subsection,
“Environmental Affiliate” shall mean any person or entity the liability of which
for Environmental Claims the Borrower has assumed by contract or
operation of
law;
(h)
Litigation
.
As soon
as the same is instituted (or, to the knowledge of the Borrower,
threatened),
furnish or caused to be furnished to the Administrative Agent details
of any
litigation, arbitration or administrative proceedings against or
involving the
Borrower which are likely to have a Material Adverse Effect;
(i)
Collateral
Vessel Valuations
.
Upon
the request of the Administrative Agent whenever the determination
of Fair
Market Value of the Tranche A and/or Tranche B Collateral Vessels
is required by
the terms hereof, obtain appraisals addressed to the Administrative
Agent of the
Fair Market Value of each of the applicable Collateral Vessels; such
valuations
are to be at the Borrower's cost and shall not be older than thirty
(30) days.
In the event the Borrower fails or refuses to obtain the valuations
requested
pursuant to this Section 9.1(i) within ten (10) days of the
Administrative Agent’s request therefor, the Administrative Agent will be
authorized to obtain such valuations, at the Borrower’s cost, from two of the
approved ship brokers listed in Schedule 3, which valuations shall
be deemed the
equivalent of valuations duly obtained by the Borrower pursuant to
this
Section 9.1(i) and shall be at the Borrower’s cost, but the Administrative
Agent’s actions in doing so shall not excuse any default of the Borrower
under
this Section 9.1(i);
(j)
Inspection
and Survey Reports
.
If the
Administrative Agent shall so request, provide the Administrative
Agent with
copies of all inspection and survey reports on the Collateral Vessels
and, if
the Administrative Agent shall so require and has a reasonable basis
to believe
that a Collateral Vessel has not been properly maintained in any
material
respect or has experienced significant technical problems, cause
such Collateral
Vessel to be surveyed by a surveyor appointed by the Administrative
Agent. All
reasonable costs arising in connection with any such survey or surveys
(including, but not without limitation, the fees of the relevant
surveyor or
firm of surveyors appointed by the Administrative Agent to make such
survey or
surveys) shall be borne by the Borrower; provided, however, that
the Borrower
shall only be required to pay for one such report per Collateral
Vessel during
any one calendar year;
(k)
Brokerage
Commissions, etc
.
Indemnify and hold the Administrative Agent and the Lenders harmless
from any
claim for any brokerage commission, fee or compensation from any
broker or third
party resulting from dealings of or with the Borrower in connection
with the
transactions contemplated hereby;
(l)
ERISA
Liability
.
Promptly upon learning of the occurrence of any material liability
of the
Borrower or any ERISA Affiliate pursuant to ERISA in connection with
the
termination of any Plan or withdrawal or partial withdrawal from
any
multiemployer plan (as defined in ERISA) or of a failure to satisfy
the minimum
funding standards of Section 412 of the Code or Part 3 of Title I
of ERISA by
any Plan in each case for which the Borrower or any ERISA Affiliate
is plan
administrator (as defined in ERISA), furnish or cause to be furnished
to the
Administrative Agent written notice thereof;
(m)
ISM
Code and ISPS Code
.
After
delivery of each Collateral Vessel, (i) procure that the Operator of such
Collateral Vessel will comply, in all material respects, with and
ensure that
the Collateral Vessel which it operates will comply, in all material
respects,
with the requirements of the ISM Code and the ISPS Code, including
(but not
limited to) the maintenance and renewal of valid certificates pursuant
thereto;
and (ii) procure that the Operators will immediately inform the Administrative
Agent if there is any threatened or actual withdrawal of the DOC,
ISSC or SMC in
respect of the Collateral Vessel; and (iii) will procure that the
Operator will
promptly inform the Administrative Agent upon the issuance to the
Borrower or
Operator of a DOC and the issuance to the Collateral Vessel of an
SMC and an
ISSC;
(n)
Insurance
.
Insure,
and keep insured, the Collateral Vessels in accordance with the terms
of the
Mortgages, which provide that each Collateral Vessel will be insured
with
respect to:
| (i) |
all
risks hull and machinery (including excess risks);
|
| (ii) |
war
risks covering, inter alia, the perils of terrorism, confiscation,
expropriation, nationalization and seizure;
and
|
| (iii) |
protection
and indemnity risks (including pollution risks, crew, cargo,
contractual
and removal of wreck insurance);
|
(o)
Other
Insurance
.
With
financially sound and reputable insurers, insure its properties and
the
properties of its consolidated subsidiaries, if any, in such amounts
and against
such risks as are usually and customarily insured against by companies
in a
similar business with respect to properties of a similar character;
(p)
Money
Laundering
.
Upon
the Administrative Agent's request, promptly supply, or procure the
supply of,
such documentation and other evidence as is reasonably requested
by the
Administrative Agent in order for each Lender to carry out and be
satisfied with
the results of all necessary “know your client” or other checks which it is
required to carry out in relation to the transactions contemplated
by this
Agreement, the Note and the Security Documents and to the identity
of any
parties to the Security Documents (other than the Lenders) and their
directors
and officers;
(q)
Time
Charters
.
Subject
to Section 9.4(b), for the duration of the period of the Facility,
keep the
Collateral Vessels employed under their respective Time Charters
in accordance
with the Deed of Covenants;
(r)
Pari
Passu Ranking
.
Ensure
that its payment obligations under the Facility Documents rank at
least
pari
passu
with all
its other present and future unsecured and unsubordinated payment
obligations,
except for obligations mandatorily preferred by law applying to companies
generally;
(s)
Security.
The
Borrower:
| (i) |
will
procure, from and after delivery of each Collateral Vessel,
that the
relevant Statutory Mortgage is, and continues to be, registered
as a first
priority mortgage on the Hong Kong Shipping Register for
such Collateral
Vessel;
|
| (ii) |
without
prejudice to sub-paragraph (i) will procure that the Statutory
Mortgage
and any other security conferred by it under any Security
Document with
respect to such Collateral Vessel are registered as a first
priority
interest with the relevant authorities within the period
prescribed by the
applicable laws and is maintained and perfected with the
relevant
authorities;
|
| (iii) |
will
at its own cost, use best efforts to ensure that any Facility
Document
validly creates the obligations and security interests,
as the case may
be, which it purports to create;
and
|
| (iv) |
without
limiting the generality of the foregoing above, will at
its own cost,
promptly register, file or record any Facility Document
with any court or
authority, pay any stamp, registration or similar tax payable
in respect
of any Facility Document, give any notice or take any other
step which, in
the reasonable opinion of the Administrative Agent, is
or has become
necessary or desirable for any Facility Document to be
valid, enforceable
or admissible in evidence or to ensure or protect the priority
of any
security interest which it creates;
and
|
(t)
Provision
of Further Information
.
And
will procure that the Manager shall, as soon as practicable following
receipt of
a request by the Administrative Agent, provide the Administrative
Agent, with
sufficient copies for all the Lenders, with any additional or further
financial
or other information relating to any of the Collateral Vessels, the
Insurances
or to any other matter relevant to, or to any provision of, a Facility
Document
which the Administrative Agent may reasonably request.
9.2
Negative
Covenants
.
The
Borrower hereby covenants and undertakes with the Lenders that, from
the date
hereof and so long as any principal, interest or other monies are
owing in
respect of the Facility or under this Agreement, the Note, the Security
Documents or any of them, the Borrower will not:
(a)
Liens
.
Without
prior consent of the Majority Lenders, create, assume or permit to
exist any
Security Interest whatsoever upon (i) any of the Collateral Vessels or any
other property subject to the Security Documents, except for Permitted
Liens or
(ii) the Management Agreement, except for that certain assignment with
respect thereto dated August 17, 2005;
(b)
Change
Business/Change Office.
(i)
change the general nature of its business from that carried on at
the date of
this Agreement, namely the direct or indirect ownership, operation
and
chartering of container vessels and any business incidental thereto
and (ii)
change its principal place of business or open any new office for
the conduct of
its business on less than thirty (30) days prior written notice to
the
Administrative Agent and (iii) establish, or do anything as a result
of which it
would be deemed to have, a place of business in any location other
than the
Republic of the Marshall Islands, Hong Kong and Vancouver;
(c)
No
Other Business Assets or Indebtedness
.
Engage
in any business other than the direct or indirect ownership, operation
and
chartering of container vessels and any business incidental thereto,
nor shall
the Borrower incur any Indebtedness to be secured in any way on the
Collateral
Vessels, or any of them, or any other collateral granted pursuant
to the
Security Documents other than the Indebtedness contemplated by this
Agreement or
any Hedge Agreements;
(d)
Dividends
.
Pay any
dividends or make any other distributions (whether by loan or otherwise)
to
shareholders unless, under applicable law and accounting principles
in its
jurisdiction of incorporation it is entitled to distribute as dividends
or such
other distribution and no Event of Default has occurred and is
continuing;
(e)
Transactions
With Affiliated Companies
.
Enter
into any material transaction with any Affiliate of it unless it
is either (i)
to comply with any obligations the Borrower may have under the Facility
Documents or (ii) on an arm's length basis or on terms reasonably
consistent
with and having a substantially similar commercial effect to an arm's
length
transaction;
(f)
Merge
.
Enter
into any merger, amalgamation, spin-off or reorganization other than
as agreed
by the Administrative Agent (acting on the instructions of the Majority
Lenders);
(g)
Change
Flag or Class
.
Without
the prior written consent of the Lenders, change, or allow to be
changed, any of
the Collateral Vessels' flags, registration or classification society;
(h)
Change
of Collateral Vessel Management
.
Change,
or allow to change, the Operator or the Manager of a Collateral Vessel;
(i)
Charter
Amendment
.
Amend
or agree to any material amendments with respect to the Time Charters
or the
Tranche B Time Charters Guarantees or any other charter relating
to a Collateral
Vessel without the prior written consent of the Majority Lenders;
(j)
Money
Laundering
.
In
connection with this Agreement, the Note or any of the Security Documents,
contravene, any law, official requirement or other regulatory measure
or
procedure implemented to combat “money laundering” (as defined in Article 1 of
the Directive (91/308/EEC) of the Council of the European Communities)
and
comparable United States Federal and state laws;
(k)
No
Amendment to Related Contracts.
Amend or
agree to any material amendment to the Related Contracts without
the prior
written consent of the Administrative Agent (acting on the instructions
of the
Majority Lenders).
9.3
Financial
Covenants
.
In this
Section 9.3, the following words and expressions below shall, except
where the
context otherwise requires, have the meanings attributed to them
below:
“Cash
and
Cash Equivalents” means, as at any date of determination:
| (a) |
cash
in hand or on deposit in the Retention
Account;
|
| (b) |
any
investment in marketable obligations issued or guaranteed
by the
government of the United States of America, Canada or the
United Kingdom
or by an instrumentality or agency of the government of
the United States
of America, Canada or the United Kingdom, maturing within
one (1) year
after the relevant date of
calculation;
|
| (c) |
time
deposits and certificates of deposit of any commercial
bank having, or
which is the principal banking subsidiary of a bank holding
company
having, a credit rating of either A by S&P or Fitch or A2 by Moody's
which time deposits and certificates of deposit mature
within one (1) year
after the relevant date of
calculation;
|
| (d) |
repurchase
obligations with a term of not more than ninety (90) days
for underlying
securities of the type referred to in subclause (b) above
entered into
with any bank meeting the qualifications specified in subclause
(c) above;
|
| (e) |
open
market commercial paper:
|
| (i) |
for
which a recognised trading market exists;
|
| (ii) |
issued
in the United States of America, Canada or the United
Kingdom;
|
| (iii) |
which
matures within one (1) year after the relevant date of
calculation;
and
|
| (iv) |
which
has a credit rating of either A-1 by S&P or Fitch or P-1 by Moody's,
or, if no rating is available in respect of the commercial
paper, the
issuer of which has, in respect of its long-term debt obligations,
an
equivalent rating; and
|
| (f) |
any
other instrument, security or investment approved by the
Majority Lenders,
in each case, to which the Borrower is beneficially entitled
at that time,
which is unencumbered (other than by any of the Security
Documents) and
which is capable of being applied against Total Borrowings.
|
“EBITDA”
means the net income of the Borrower for a Measurement Period as
adjusted
by:
(b)
adding
back taxation;
(c)
adding
back Interest Expenses;
(d)
taking
no
account of any extraordinary item;
(e)
excluding
any amount attributable to minority interests;
(f)
adding
back depreciation and amortisation; and
(g)
taking
no
account of any revaluation of an asset or any loss or gain over book
value
arising on the disposal of an asset (otherwise than in the ordinary
course of
trading) by the Borrower during that Measurement Period.
“Interest
and Principal Coverage Ratio” means, as at any date of determination and with
respect to any period, the ratio of EBITDA for such period to Interest
and
Principal Expense for such period.
“Interest
and Principal Expense” means all Interest Expense incurred and all payments of
principal made by the Borrower during a Measurement Period.
“Interest
Expense” means all cash interest and cash commitment fees incurred by the
Borrower during a Measurement Period.
“Marketable
Securities” means any bonds, stocks, notes or bills payable in a freely
convertible and transferable currency and which are listed on a stock
exchange
acceptable to the Administrative Agent (acting on the instructions
of the
Majority Lenders).
“Measurement
Period” means, at any time, the last four (4) fiscal quarters for the Borrower
provided always that until four (4) fiscal quarters have elapsed
from the date
of this Agreement, it shall mean the period from the date of this
Agreement
until the date of determination.
“Net
Interest Coverage Ratio” means, as at any date of determination and with respect
to any period, the ratio of EBITDA for such period to Net Interest
Expense for
such period.
“Net
Interest Expense” means Interest Expense less all interest and other financing
charges received by the Borrower during a Measurement Period.
“Tangible
Net Worth” means at any time the amount paid up or credited as paid up on the
issued share capital of the Borrower based on the latest published
audited
balance sheet of the Borrower but adjusted by:
(h)
adding
any amount standing to the credit of the profit and loss account
of the Borrower
for the period ending on the date of such latest balance sheet;
(i)
deducting
any dividend or other distribution declared, recommended or made
by the
Borrower;
(j)
deducting
any amount standing to the debit of the profit and loss account of
the Borrower
for the period ending on the date of such latest balance sheet;
(k)
deducting
any amount attributable to goodwill (other than goodwill attributable
to all
vessels owned or leased with a purchase option by the Borrower) or
any other
intangible asset;
(l)
deducting
any amount attributable to an upward revaluation of assets after
the date of
this Agreement;
(m)
adding
the amount referred to in Schedule 4 hereof for the date of the latest
balance
sheet which represents the difference between the purchase price
of those
certain delivered vessels listed on Schedule 4 hereof paid by the
Borrower and
the book value of such delivered vessels reduced for depreciation
in equal
increments over a thirty (30) year period;
(n)
reflecting
any variation in the amount of the issued share capital of the Borrower
and the
capital and revenue reserves of the Borrower after the date of such
latest
balance sheet;
(o)
reflecting
any variation in the interest of the Borrower since the date of such
latest
balance sheet;
(p)
excluding
any amount attributable to deferred taxation; and
(q)
excluding
any amount attributable to minority interests.
“Total
Assets” means, at any date, the aggregate of:
(r)
the
then
current book values of all vessels owned or leased with a purchase
option by the
Borrower, but adding back, in relation to those certain delivered
vessels listed
on Schedule 4 hereof, the amount referred to in paragraph (f) of the
definition of Tangible Net Worth;
(s)
the
then
current aggregate amount of cash, Marketable Securities (but no other
bonds,
notes or bills and less any cash or Marketable Securities accounted
for in the
definition of Total Borrowings below) and receivables due to the
Borrower (less
provision for bad and doubtful debts) as shown in the latest financial
statements; and
(t)
the
book
values of all other assets as shown in such latest financial
statements.
“Total
Borrowings” means, in respect of the Borrower, at any time the aggregate of the
following:
(u)
the
outstanding principal amount of any monies borrowed;
(v)
the
outstanding principal amount of any acceptance under any acceptance
credit;
(w)
the
outstanding principal amount of any bond, note, debenture, loan stock
or other
similar instrument;
(x)
the
capitalized element of indebtedness under a finance or capital
lease;
(y)
the
outstanding principal amount of all monies owing in connection with
the sale or
discounting of receivables (otherwise than on a non-recourse
basis);
(z)
the
outstanding principal amount of any indebtedness arising from any
deferred
payment agreements arranged primarily as a method of raising finance
or
financing the acquisition of an asset;
(aa)
any
fixed
or minimum premium payable on the repayment or redemption of any
instrument
referred to in paragraph (c) above;
(bb)
the
outstanding principal amount of any indebtedness arising in connection
with any
other transaction (including any forward sale or purchase agreement)
which has
the commercial effect of a borrowing; and
(cc)
the
outstanding principal amount of any indebtedness of any person of
a type
referred to in the above paragraphs which is the subject of a guarantee,
indemnity or similar assurance against financial loss given by the
Borrower.
Interpretation
of this Section 9.3 shall take into account:
(i)
Except
as
provided to the contrary in this Agreement, an accounting term used
in this
Clause is to be construed in accordance with GAAP;
(ii)
Any
amount in a currency other than Dollars is to be taken into account
at its
Dollar equivalent calculated on the basis of:
| (A) |
the
Administrative Agent's spot rate of exchange for the purchase
of the
relevant currency in the London foreign exchange market
with Dollars at or
about 11.00 a.m. on the day the relevant amount falls to
be calculated;
or
|
| (B) |
if
the amount is to be calculated on the last day of a financial
period of
the Borrower, the relevant rates of exchange used by the
Borrower in, or
in connection with, its financial statements for that period;
and
|
(iii)
No
item
must be credited or deducted more than once in any calculation under
this
Section.
The
Borrower hereby covenants and undertakes with the Lenders that, from
the date
hereof and so long as any principal or interest are outstanding or
other monies
are owing in respect of this Agreement, under the Note or under any
of the
Security Documents:
(dd)
Tangible
Net Worth
.
The
Borrower must ensure that Tangible Net Worth always exceeds Four
Hundred and
Fifty Million Dollars ($450,000,000).
(ee)
Leverage
.
The
Borrower must ensure that Total Borrowings are always less than 65%
of Total
Assets at that time.
(ff)
Minimum
Liquidity
.
If, at
any time, more than fifty percent (50%) of the Collateral Vessels
(assessed by
value) are subject to time charters which have a remaining term of
one year or
less (excluding any optional extensions not then exercised), the
Borrower must
ensure that the Cash and Cash Equivalents held by the Borrower at
such date of
determination are not less than Twenty Five Million Dollars ($25,000,000).
(gg)
Net
Interest Coverage Ratio
.
The
Borrower must ensure that the Net Interest Coverage Ratio is always
greater than
2.50 to 1.
(hh)
Interest
and Principal Coverage Ratio
.
The
Borrower must ensure that the Interest and Principal Coverage Ratio
is always
greater than or equal to 1.1 to 1.
(ii)
Charter
Default
.
The
Borrower must ensure at all times following a termination, Charter
Breach, or
expiration of a Time Charter, in circumstances where substitute charters
complying with the requirements Section 9.4(c) have not been entered into
by the Borrower within ninety (90) days of such termination, Charter
Breach or
expiration or if the Administrative Agent has not received additional
security
satisfactory to it in accordance with such Section 9.4(c), that the
aggregate of
the Fair Market Value of all of the Collateral Vessels actually delivered
in
respect of the relevant Tranche is not less than 125% of the aggregate
principal
amount of the outstanding Advances in respect of such Collateral
Vessels.
(jj)
Testing
of Financial Covenants
.
Each of
the financial covenants set out in this Section 9.3 (inclusive) shall
be tested
by reference to each rolling twelve (12) month Measurement Period,
provided
always that the Interest and Principal Coverage Ratio referred to
in Section
9.3(e) shall be tested on the basis of the financial statements of
the Borrower
for the last fiscal quarter of the Borrower in the event of the occurrence
of
the circumstances set out in Clause 9.3(f).
9.4
Additional
Covenants Relating to Management and Chartering of the Collateral
Vessels
.
The
Borrower hereby covenants and undertakes with the Lenders that, from
the date
hereof and so long as any principal, interest or other monies are
owing in
respect of the Facility or under this Agreement, the Note, the Security
Documents or any of them, the Borrower:
(a)
Management
.
Shall,
and shall procure that the Manager shall, ensure that at all times
after the
relevant Delivery Date:
(i)
the
relevant Collateral Vessel is managed by the Manager; and
(ii)
the
Manager shall not terminate or materially vary the terms of its management
or
appoint an alternative manager, provided that the Borrower shall
be entitled so
to do with the prior written consent of the Administrative Agent
(acting on the
instructions of the Majority Lenders).
In
the
event that a Manager's appointment as manager of any one of the Collateral
Vessels ceases or is terminated in circumstances where it was not
possible for
the Borrower to obtain the prior written consent of the Administrative
Agent,
the Borrower shall promptly and in any event within ten (10) days
from the date
of the termination of such Manager's appointment, provide to the
Administrative
Agent details of a replacement manager, such manager to be satisfactory
to the
Administrative Agent (acting on the instructions of the Majority
Lenders).
(b)
Charters
.
Will not
let any of the Collateral Vessels on demise, consecutive voyage or
voyage
charter for any period without the consent of the Administrative
Agent (acting
on the instructions of the Majority Lenders) such consent not to
be unreasonably
withheld;
provided
,
however
,
that
the Borrower shall be entitled to charter the Collateral Vessels,
in accordance
with the terms of the Time Charters
provided
always
that:
| (i) |
the
Borrower shall remain liable under any time charter to
perform all the
obligations assumed by it under the Time
Charter;
|
| (ii) |
the
Administrative Agent shall not be under any obligations
or liability under
any time charter or liable to make any payment under that
time charter;
and
|
| (iii) |
the
Administrative Agent shall not be obliged to enforce against
any charterer
any term of any time charter, or to make any enquiries
as to the nature or
sufficiency of any payment received by the Administrative
Agent.
|
| (c) |
Termination,
Charter Breach or Expiration of Time Charter
.
(i)
Shall advise the Administrative Agent of any of the following
events:
|
| (A) |
The
termination of a Time Charter by either the Borrower or
the relevant Time
Charterer;
|
| (B) |
Any
Charter Breach;
|
| (C) |
The
expiration of a Time Charter;
|
| (D) |
As
soon as it becomes aware of such event, the occurrence
of an event of
cross default of the nature referred to in Section 8.1(d)
in respect of a
Time Charterer,
provided
always that such event shall not arise in respect of the
Time Charterer
where the aggregate amount of the relevant Indebtedness
of the Time
Charterer is less than US$50,000,000 or its equivalent;
or
|
| (E) |
As
soon as it becomes aware of such event, the occurrence
of an insolvency
event of the nature referred to in Sections 8.1(e), 8.1(f),
8.1(g) and
8.1(h) in respect of a Time
Charterer,
|
and
upon
the occurrence of any such event the Administrative Agent shall be
(acting on
the instructions of the Majority Lenders) entitled to require that
the Borrower
exercises all of its rights under the relevant Time Charter including,
where
applicable, the termination of the Time Charter in respect of the
relevant
Collateral Vessel.
(ii)
In
the
event of a termination, Charter Breach or expiration of a Time Charter
in
accordance with (i) above, the Borrower shall, within ninety (90)
days of such
Charter Breach, termination or expiration, enter into suitable substitute
time
charter with a charterer acceptable to the Lenders and with a term
extending to
at least the relevant Final Payment Date, such time charter to be
in form and
substance reasonably acceptable to the Administrative Agent (acting
on the
instructions of the Majority Lenders), provided that all amounts
due and payable
by the Borrower under the Facility have been paid and no due and
payable amounts
remaining outstanding, failing which the Borrower shall either:
| (A) |
prepay
the outstanding Advances in accordance with Section 5.9;
or
|
| (B) |
the
Borrower shall provide or cause to be provided to the Administrative
Agent
such additional security as is satisfactory to the Administrative
Agent
(acting on the instructions of the Majority Lenders) so
as to achieve the
loan to value ratio referred to in Section
5.9.
|
10.1
Maintenance
of Retention Account
.
The
Borrower shall maintain the Retention Account with the Administrative
Agent
until the Final Payment Date, free of any mortgage, pledge, lien,
charge,
encumbrance or any security interest whatsoever and rights of set-off
other than
as created by or pursuant to the Security Documents.
10.2
Transfers
to Retention Account
.
(i)
The
Borrower shall procure that upon receipt of any amounts representing
proceeds of
a sale of a Collateral Vessel or proceeds following a Total Loss
(as defined in
the relevant Deed of Covenants) of a Collateral Vessel, such amounts
are paid
into the Retention Account.
(ii)
Upon
the
occurrence of an Event of Default which is continuing, the Borrower
shall
procure that all Earnings in respect of the Collateral Vessels are
transferred
into the Retention Account.
10.3
Application
of Retention Account
.
(a)
In
the
event that a mandatory prepayment obligation arises under Section
5.5 upon a
sale or Total Loss (as defined in the relevant Deed of Covenants)
of a
Collateral Vessel, the Borrower shall procure that there is transferred
from the
Retention Account (and irrevocably authorises the Administrative
Agent to
transfer from the Retention Account) to the Administrative Agent
in prepayment
of the relevant Advance any amounts as may be required pursuant to
Section 5.5;
and (unless an Event of Default shall have occurred and be continuing)
the
balance of the proceeds of a sale or Total Loss (as defined in the
Relevant Deed
of Covenants) of the relevant Collateral Vessel, following the foregoing
transfer in this subsection (a), may be released to such other account
as the
Borrower shall designate.
(b)
Following
the occurrence of an Event of Default which is continuing, any monies
standing
to the credit of the Retention Account shall be applied in accordance
with
Section 8.3.
10.4
Restriction
on Withdrawal
.
During
the term of the Facility, no sum may be withdrawn from the Retention
Account
(except in accordance with this Section 10.4) without the prior written
consent
of the Administrative Agent (acting on the instructions of the Majority
Lenders).
| 11. |
ASSIGNMENT.
|
This
Agreement shall be binding upon, and inure to the benefit of, the
Borrower and
the Creditors and their respective successors and assigns, except
that the
Borrower may not assign any of their rights or obligations hereunder.
Each
Lender shall be entitled to assign its rights and obligations under
this
Agreement or grant participation(s) in the Facility to any subsidiary,
holding
company or other affiliate of such Lender, to any subsidiary or other
affiliate
company
of any thereof or to any other bank or financial institution approved
by the
Administrative Agent and the Borrower, which approval shall not be
unreasonably
withheld; provided, however, (i) no such assignment or participation
shall be
made or granted, as the case may be, if such assignment or participation
shall
result in increased costs or withholding or other Taxes to the Borrower,
and
(ii) that no consent of the Borrower shall be required if an Event
of Default
has occurred and is continuing at the time of such assignment and
(iii) that no
such consent shall be required if the assignee is, immediately prior
to giving
effect to such assignment, another bank or financial institution
which is an
Affiliate of the assigning Lender (in a minimum amount of not less
than Five
Million Dollars ($5,000,000)), or if lower than such minimum amount,
the balance
of such Lender’s Commitment, and such Lender shall forthwith give notice of any
such assignment or participation to the Borrower and pay the Administrative
Agent an assignment fee of Three Thousand Dollars ($3,000) for each
such
assignment or participation which is not made to a subsidiary, holding
company
or affiliate of the assigning Lender; provided, however, that any
such
assignment must be made pursuant to an Assignment and Assumption
Agreement. The
Borrower will take all actions reasonably requested by any Creditor
to effect
such assignment, including, without limitation, the execution of
a written
consent to any Assignment and Assumption Agreement.
| 12. |
INCREASED
COST, NON-AVAILABILITY, ETC.
|
12.1
Increased
Costs
.
If any
change in applicable law, regulation or regulatory requirement (including
any
applicable law, regulation or regulatory requirement which relates
to capital
adequacy or liquidity controls or which affects the manner in which
any Lender
allocates capital resources under this Agreement), of general application
to
financial institutions in such Lender’s jurisdiction or in the interpretation or
application thereof by any governmental or other authority, shall:
| (i) |
subject
any Lender to any Taxes
(other
than a Tax imposed on the net income of a Lender or its
facility office by
the jurisdiction in which it is incorporated, the jurisdiction
in which
its facility office is located, the jurisdiction in which
payments under
the Facility may be made or on the capital of that Lender
employed in such
jurisdiction or jurisdictions); or
|
| (ii) |
change
the basis of taxation to any Lender of payments of principal
or interest
or any other payment due or to become due pursuant to this
Agreement
(other than a change in the basis effected by the jurisdiction
of the
organization of such Lender,
the
jurisdiction in which its facility office is located, the
jurisdiction in
which payments under the Facility may be made or on the
capital of that
Lender employed in such jurisdiction or jurisdictions);
or
|
| (iii) |
impose,
modify or deem applicable any reserve requirements or require
the making
of any special deposits against or in respect of any assets
or liabilities
of, deposits with or for the account of, or loans by, any
Lender;
or
|
| (iv) |
impose
on any Lender any other condition affecting the Facility;
|
and
the result of the foregoing is either to increase the cost to a Lender
of making
available or maintaining the Facility or any part thereof or to reduce
the
amount of any payment received by such Lender, then and in any such
case if such
increase or reduction in the reasonable opinion of such Lender materially
and
adversely affects the interests of such Lender under or in connection
with this
Agreement:
(b)
such
Lender shall notify the Borrower of the happening of such event,
and
(c)
the
Borrower shall forthwith upon demand pay to such Lender such amount
as the
Lender certifies to be necessary to compensate the Lender for such
additional
cost or such reduction.
The
Borrower will not need to make any payment to the Lenders for an
increased cost
to the extent that such increased cost (i) is compensated for under another
section of this Agreement, or (ii) is attributable to the relevant Lender
wilfully failing to comply with any law or regulation. The relevant
Lender must
use commercially reasonable efforts to mitigate any circumstances
which arise
and which result in any increased cost being payable to that Lender
by the
Borrower and the Borrower will indemnify that Lender for all costs
and expenses
reasonably incurred by it as a result of any such mitigation. Following
a claim
by a Lender for an increased cost, the Borrower shall, with the consent
of the
Administrative Agent (acting on the instructions of the Majority
Lenders), be
entitled to compel such Lender to transfer its Commitment pursuant
to the terms
of Section 11 to a Lender or new lender that the Borrower
identifies.
12.2
Nonavailability
of Funds
.
If the
Administrative Agent shall determine that, by reason of circumstances
affecting
the London Interbank Market generally, adequate and reasonable means
do not or
will not exist for ascertaining the Applicable Rate for the Facility
for any
Interest Period, the Administrative Agent shall give notice of such
determination to the Borrower. The Borrower and the Administrative
Agent shall
then negotiate in good faith in order to agree upon a mutually satisfactory
interest rate and/or Interest Period to be substituted for those
which would
otherwise have applied under this Agreement. If the Borrower and
the
Administrative Agent are unable to agree upon such a substituted
interest rate
and/or Interest Period within thirty (30) days of the giving of such
determination notice, the Administrative Agent shall set an interest
rate and
Interest Period to take effect from the expiration of the Interest
Period in
effect at the date of determination, which rate shall be equal to
the applicable
margin plus the cost to the Lenders (as noticed by the Lenders to
the
Administrative Agent and as certified by the Administrative Agent
to the
Borrower) of funding the Facility. In the event the state of affairs
referred to
in this Section 12.2 shall extend beyond the end of such Interest
Period, the
foregoing procedure shall continue to apply until circumstances are
such that
the Applicable Rate may be determined pursuant to Section 6.
12.3
Administrative
Agent's Certificate Conclusive
.
A
certificate or determination notice of the Administrative Agent as
to any of the
matters referred to in this Section 12 shall, save for any manifest
error, be
conclusive and binding on the Borrower.
12.4
Compensation
for Losses
.
Where
the Facility or any portion thereof is to be prepaid by the Borrower
pursuant to
any of the foregoing provisions of this Section 12 the Borrower shall
simultaneously with such prepayment pay to the affected Lenders all
accrued
interest to the date of actual payment and all other sums payable
by the
Borrower to the Administrative Agent, the Security Agent or the Lenders
pursuant
to this Agreement together with such amounts as may be certified
by the
Administrative Agent to be necessary to compensate the Administrative
Agent, the
Security Agent or the Lenders for any loss, premium or penalties
incurred or to
be incurred by them on account of funds borrowed to make, fund or
maintain the
Facility or any part thereof for the remainder (if any) of the then
current
Interest Period or Interest Periods in accordance with Section 5.10
but
otherwise without penalty or premium.
| 13. |
CURRENCY
INDEMNITIES.
|
13.1
Currency
Conversion
.
If for
the purpose of obtaining or enforcing a judgment in any court in
any country it
becomes necessary to convert into any other currency (the “judgment currency”)
an amount due in Dollars under this Agreement, the Note or any of
the Security
Documents then the conversion shall be made, in the discretion of
the
Administrative Agent, at the rate of exchange prevailing either on
the date of
default or on the day before the day on which the judgment is given
or the order
for enforcement is made, as the case may be (the “conversion date”), provided
that the Lenders shall not be entitled to recover under this clause
any amount
in the judgment currency which exceeds at the conversion date the
amount in
Dollars due under this Agreement, the Note or any of the Security
Documents.
13.2
Change
in Exchange Rate
.
If
there is a change in the rate of exchange prevailing between the
conversion date
and the date of actual payment of the amount due, the Borrower shall
pay such
additional amounts (if any) as may be necessary to ensure that the
amount paid
in the judgment currency when converted at the rate of exchange prevailing
on
the date of payment will produce the amount then due under this Agreement,
the
Note or any of the Security Documents in Dollars. Any excess over
the amount due
received or collected by the Lenders shall be remitted to the
Borrower.
13.3
Additional
Debt Due
.
Any
amount due from the Borrower under this Section 13 shall be due as
a separate
debt and shall not be affected by judgment being obtained for any
other sums due
under or in respect of this Agreement, the Note and/or any of the
Security
Documents.
13.4
Rate
of Exchange
.
The
term “rate of exchange” in this Section 13 means the rate at which the
Administrative Agent in accordance with its normal practices is able
on the
relevant date to purchase Dollars with the judgment currency and
includes any
premium and costs of exchange payable in connection with such
purchase.
| 14. |
FEES
AND EXPENSES.
|
14.1
Fee
Letter
.
On or
prior to the date of this Agreement, the Borrower shall pay to the
Administrative Agent and the Lenders such fees as the parties have
agreed
pursuant to the Fee Letter.
14.2
Commitment
Fee
.
The
Borrower shall pay to the Administrative Agent on behalf of the Lenders
quarterly in arrears a commitment fee on the average undrawn portion
of the
Facility equal to 0.30% per annum (based on the actual number of
days over 360
days) commencing from the date hereof through the Final Payment Date
or, if
earlier, the date all sums are prepaid pursuant to Section 5
hereof.
14.3
Expenses
.
The
Borrower agrees, whether or not the transactions hereby contemplated
are
consummated, on demand to pay, or reimburse the Administrative Agent
and the
Security Agent for the payment of, the expenses of the Administrative
Agent, the
Security Agent and (after the occurrence and during the continuance
of an Event
of Default) the Lenders incident to said transactions (and in connection
with
any supplements, amendments, waivers or consents relating thereto
or incurred in
connection with the enforcement or defense the Creditors' rights
or remedies
with respect thereto or in the preservation of Creditors' priorities
under the
documentation executed and delivered in connection therewith), including,
without limitation, all reasonable costs and expenses of preparation,
negotiation, execution and administration of this Agreement and the
documents
referred to herein, the reasonable fees and disbursements of the
Creditors'
counsel in connection therewith, as well as the reasonable fees and
expenses of
any independent appraisers, surveyors, engineers, inspectors and
other
consultants retained by the Administrative Agent and the Security
Agent in
connection and in accordance with this Agreement and under the Security
Documents, all costs and expenses, if any, in connection with the
enforcement of
this Agreement, the Note and the Security Documents and stamp and
other similar
taxes, if any, incident to the execution and delivery of the Credit
Agreement,
the Security Documents and the Note herein contemplated and to hold
the
Creditors free and harmless in connection with any liability arising
from the
nonpayment of any such stamp or other similar taxes. Such taxes and
interest
thereon, if any, and penalties related thereto as may become payable
after the
date hereof shall be paid immediately by the Borrower to the Creditors,
as the
case may be, when liability therefor is no longer contested by such
party or
parties or reimbursed immediately by the Borrower to such party or
parties after
payment thereof (if the Creditors, at their sole discretion, choose
to make such
payment) and such payment was required to be made under this Agreement
or under
applicable laws.
| 15. |
APPLICABLE
LAW, JURISDICTION, AND WAIVER.
|
15.1
Applicable
Law
.
This
Agreement shall be governed by, and construed in accordance with,
the laws of
the State of New York.
15.2
Jurisdiction
.
The
Borrower hereby irrevocably submits to the jurisdiction of the courts
of the
State of New York and of the United States District Court for the
Southern
District of New York in any action or proceeding brought against
it by any of
the Lenders, the Administrative Agent or the Security Agent under
this Agreement
or under any document delivered hereunder and hereby irrevocably
agrees that
valid service of summons or other legal process on it may be effected
by serving
a copy of the summons and other legal process in any such action
or proceeding
on the Borrower by mailing or delivering the same by hand to the
Borrower at the
address indicated for notices in Section 17.1. The service, as herein
provided, of such summons or other legal process in any such action
or
proceeding shall be deemed personal service and accepted by the Borrower
as
such, and shall be legal and binding upon the Borrower for all the
purposes of
any such action or proceeding. Final judgment (a certified or exemplified
copy
of which shall be conclusive evidence of the fact and of the amount
of any
indebtedness of the Borrower to the Lenders, the Administrative Agent
or the
Security Agent) being a judgment that cannot or can no longer be
appealed
against the Borrower in any such legal action or proceeding shall
be conclusive
and may be enforced in other jurisdictions by suit on the judgment.
The Borrower
will advise the Administrative Agent promptly of any change of address
for the
purpose of service of process. Notwithstanding anything herein to
the contrary,
any of the Lenders, the Administrative Agent or the Security Agent
may bring any
legal action or proceeding in any other appropriate jurisdiction
.
15.3
WAIVER
OF JURY TRIAL
.
IT IS
MUTUALLY AGREED BY AND AMONG THE BORROWER, THE ADMINISTRATIVE AGENT,
THE
SECURITY AGENT AND THE LENDERS THAT EACH OF THEM HEREBY WAIVES TRIAL
BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY HERETO
AGAINST ANY
OTHER PARTY HERETO ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN
ANY WAY
CONNECTED WITH THIS AGREEMENT, THE NOTE OR THE SECURITY DOCUMENTS.
| 16. |
THE
ADMINISTRATIVE AGENT.
|
16.1
Appointment
of Administrative Agent
.
Each of
the Lenders hereby irrevocably appoints and authorizes the Administrative
Agent
(which for purposes of this Section 16 shall be deemed to include
the
Administrative Agent acting in its capacity as Security Agent pursuant
to
Section 16.2) to take such action as Administrative Agent on its behalf and
to exercise such powers under this Agreement, the Note, and the Security
Documents as are delegated to the Administrative Agent by the terms
hereof and
thereof. Neither the Administrative Agent nor any of its directors,
officers,
employees or Administrative Agents shall be liable for any action
taken or
omitted to be taken by it or them under this Agreement, the Note,
or the
Security Documents or in connection therewith, except for its or
their own gross
negligence or willful misconduct.
16.2
Security
Agent as Agent
.
Each of
the Creditors irrevocably appoints the Security Agent as agent and
trustee on
its behalf with regard to (i) the security, powers, rights, titles,
benefits and interests (both present and future) constituted by and
conferred on
the Lenders or any of them or for the benefit thereof under or pursuant
to this
Agreement, the Note or any of the Security Documents (including,
without
limitation, the benefit of all covenants, undertakings, representations,
warranties and obligations given, made or undertaken to any Lender
in the
Agreement, the Note or any Security Document), (ii) all monies, property
and
other assets paid or transferred to or vested in any Lender or any
agent of any
Lender or received or recovered by any Lender or any agent of any
Lender
pursuant to, or in connection with, this Agreement, the Note or the
Security
Documents whether from the Borrower or any other person and (iii)
all money,
investments, property and other assets at any time representing or
deriving from
any of the foregoing, including all interest, income and other sums
at any time
received or receivable by any Lender or any agent of any Lender in
respect of
the same (or any part thereof). The Security Agent hereby accepts
such
appointment.
16.3
Distribution
of Payments
.
Whenever any payment is received by the Administrative Agent from
the Borrower
for the account of the Lenders, or any of them, whether of principal
or interest
on the Note, commissions, fees, or otherwise, it will thereafter
cause to be
distributed on the same day if received before 12 p.m. New York time,
or on the
next day if received thereafter, like funds relating to such payment
ratably to
the Lenders according to their respective Commitments, in each case
to be
applied according to the terms of this Agreement.
16.4
Holder
of Interest in Note
.
The
Administrative Agent may treat each Lender as the holder of all of
the interest
of such Lender in the Note.
16.5
No
Duty to Examine, Etc
.
The
Administrative Agent shall not be under any duty to examine or pass
upon the
validity, effectiveness or genuineness of this Agreement, the Note
or the
Security Documents or any instrument, document or communication furnished
pursuant to this Agreement or in connection therewith or in connection
with any
Note or Security Document, and the Administrative Agent shall be
entitled to
assume that the same are valid, effective and genuine, have been
signed or sent
by the proper parties and are what they purport to be.
16.6
Administrative
Agent as Lender
.
With
respect to that portion of the Facility made available by it, the
Administrative
Agent shall have the same rights and powers hereunder as any other
Lenders and
may exercise the same as though it were not the Administrative Agent,
and the
term “Lender” or “Lenders” shall include the Administrative Agent in its
capacity as a Lender. The Administrative Agent and its affiliates
may accept
deposits from, lend money to and generally engage in any kind of
business with,
the Borrower, as if it were not the Administrative Agent.
16.7
Acts
of the Administrative Agent
.
The
Administrative Agent shall have duties and reasonable discretion,
and shall act
as follows:
(a)
Obligations
of Administrative Agent
.
The
obligations of the Administrative Agent under this Agreement, under
the Note,
and under the Security Documents are only those expressly set forth
herein and
therein.
(b)
No
Duty to Investigate
.
The
Administrative Agent shall not at any time be under any duty to investigate
whether an Event of Default, or an event which with the giving of
notice or
lapse of time, or both, would constitute an Event of Default, has
occurred or to
investigate the performance of this Agreement or any of the Security
Documents
by the Borrower.
(c)
Administrative
Agent's Discretion
.
The
Administrative Agent shall be entitled to use its discretion with
respect to
exercising or refraining from exercising any rights which may be
vested in it
by, and with respect to taking or refraining from taking any action
or actions
which it may be able to take under or in respect of, this Agreement,
the Note,
and the Security Documents, unless the Administrative Agent shall
have been
instructed by the Majority Lenders to exercise such rights or to
take or refrain
from taking such action; provided, however, that the Administrative
Agent shall
not be required to take any action which exposes the Administrative
Agent to
personal liability or which is contrary to this Agreement or applicable
law.
(d)
Instructions
of Majority Lenders
.
The
Administrative Agent shall in all cases be fully protected in acting
or
refraining from acting under this Agreement, under the Note or under
any
Security Document in accordance with the instructions of the Majority
Lenders,
and any action taken or failure to act pursuant to such instructions
shall be
binding on all of the Lenders.
16.8
Certain
Amendments
.
Neither
this Agreement, the Note nor any of the Security Documents nor any
terms hereof
or thereof may be amended unless such amendment is approved by the
Borrower and
the Majority Lenders, provided that no such amendment shall, without
the written
consent of each Lender affected thereby, (i) reduce the interest rate or
extend the time of a scheduled payment of principal or interest or
fees on the
Facility, or reduce the principal amount of the Facility or any fees
hereunder,
(ii) increase or decrease the Commitment of any Lender or subject any
Lender to any additional obligation (it being understood that a waiver
of any
Event of Default, other than a payment default, or any mandatory
repayment of
the Facility shall not constitute a change in the terms of any Commitment
of any
Lender), (iii) amend, modify or waive any provision of this Section 16.8,
(iv) amend the definition of Majority Lenders or any other definition
referred to in this Section 16.8, (v) consent to the assignment or transfer
by the Borrower of any of their rights and obligations under this
Agreement, or
(vi) release the Borrower from any of its obligations under any Security
Document except as expressly provided herein or in such Security
Document;
provided, further, that approval by all Lenders shall be required
for any
amendment or waivers with respect to Section 5 of this Agreement.
All amendments
approved by the Majority Lenders under this Section 16.8 must be in writing
and signed by the Borrower, each of the Lenders comprising the Majority
Lenders
and, if applicable, each Lender affected thereby and any such amendment
shall be
binding on all the Lenders;
provided
,
however
,
that
any amendments or waivers with respect to Section 5 of this Agreement
must be in
writing and signed by the Borrower and all of the Lenders.
16.9
Assumption
re: Events of Default
.
Except
as otherwise provided in Section 16.15, the Administrative Agent shall be
entitled to assume that no Event of Default, or event which with
the giving of
notice or lapse of time, or both, would constitute an Event of Default,
has
occurred and is continuing, unless the Administrative Agent has been
notified by
the Borrower of, such fact or has been notified by a Lender that
such Lender
considers that an Event of Default or such an event (specifying in
detail the
nature thereof) has occurred and is continuing. In the event that
the
Administrative Agent shall have been notified by the Borrower or
any Lender in
the manner set forth in the preceding sentence of any Event of Default
or of an
event which with the giving of notice or lapse of time, or both,
would
constitute an Event of Default, the Administrative Agent shall notify
the
Lenders and shall take action and assert such rights under this Agreement,
under
the Note, and under Security Documents as the Majority Lenders shall
request in
writing.
16.10
Limitation
of Liability
.
Neither
the Administrative Agent nor any of the Lenders shall be under any
liability or
responsibility whatsoever:
(a)
To
the
Borrower or any other person or entity as a consequence of any failure
or delay
in performance by, or any breach by, any other Lender or any other
(b)
person
of
any of its or their obligations under this Agreement, the Note or
under any
Security Document;
(c)
To
any
Lender or Lenders, as a consequence of any failure or delay in performance
by,
or any breach by, the Borrower of any of its obligations under this
Agreement,
under the Note, or under the Security Documents; or
(d)
To
any
Lender or Lenders, for any statements, representations or warranties
contained
in this Agreement, the Note, in any Security Document or any Document
or
instrument delivered in connection with the transaction hereby contemplated;
or
for the validity, effectiveness, enforceability or sufficiency of
this
Agreement, the Note, or any Security Document or any document or
instrument
delivered in connection with the transactions hereby contemplated.
16.11
Indemnification
of the Administrative Agent
.
The
Lenders agree to indemnify the Administrative Agent (to the extent
not
reimbursed by the Borrower), pro rata according to the respective
amounts of
their Commitments, from and against, provided that they are a result
of the
Administrative Agent acting in such capacity and not as a Lender,
any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits,
costs, expenses or disbursements of any kind or nature whatsoever
(including
legal fees and expenses incurred in investigating claims and defending
itself
against such liabilities) which may be imposed on, incurred by or
asserted
against, the Administrative Agent in any way relating to or arising
out of this
Agreement, the Note, or any Security Document, any action taken or
omitted by
the Administrative Agent thereunder or the preparation, administration,
amendment or enforcement of, or waiver of any provision of, this
Agreement, the
Note, or any Security Document, except that no Lenders shall be liable
for any
portion of such liabilities, obligations, losses, damages, penalties,
actions,
judgments, suits, costs, expenses or disbursements resulting from
the
Administrative Agent's gross negligence, bad faith or willful
misconduct.
16.12
Consultation
with Counsel
.
The
Administrative Agent may consult with legal counsel reasonably selected
by it
and shall not be liable for any action taken, permitted or omitted
by it in good
faith in accordance with the advice or opinion of such counsel.
16.13
Resignation
.
The
Administrative Agent may resign at any time by giving thirty (30)
days' written
notice thereof to the Lenders and the Borrower. Upon any such resignation,
the
Lenders shall have the right to appoint a successor Administrative
Agent
reasonably acceptable to the Borrower. If no successor Administrative
Agent
shall have been so appointed by the Lenders and shall have accepted
such
appointment within 30 days after the retiring Administrative Agent's
giving
notice of resignation, then the retiring Administrative Agent may,
on behalf of
the Lenders, appoint a successor Administrative Agent which shall
be a bank or
trust company of recognized standing. The appointment of any successor
Administrative Agent shall be subject to the prior written consent
of the
Borrower, such consent not be unreasonably withheld. After any retiring
Administrative Agent's resignation as Administrative Agent hereunder,
the
provisions of this Section 16 shall continue in effect for its benefit
with
respect to any actions taken or omitted by it while acting as Administrative
Agent.
16.14
Representations
of Lender
.
Each
Lender represents and warrants to the Borrower, each other Lender
and the
Administrative Agent that:
(a)
In
making
its decision to enter into this Agreement and to make its Commitment
available
hereunder, it has independently taken whatever steps it considers
necessary to
evaluate the financial condition and affairs of the Borrower, that
it has made
an independent credit judgment and that it has not relied upon any
statement,
representation or warranty by any other Lender or the Administrative
Agent;
and
(b)
So
long
as any portion of its Commitment remains outstanding, it will continue
to make
its own independent evaluation of the financial condition and affairs
of the
Borrower.
16.15
Notification
of Event of Default
.
The
Administrative Agent hereby undertakes to promptly notify the Lenders,
and the
Lenders hereby promptly undertake to notify the Administrative Agent
and the
other Lenders, of the existence of any Event of Default which shall
have
occurred and be continuing of which the Administrative Agent or any
Lender has
actual knowledge.
16.16
No
Agency or Trusteeship if DnB NOR only Lender
.
If at
any time DnB NOR is the only Lender, all references to the terms
“Administrative
Agent” and “Security Agent” shall be deemed to be references to DnB NOR as
Lender and not as administrative agent or security agent.
| 17. |
NOTICES
AND DEMANDS.
|
17.1
Notices
.
All
notices, requests, demands and other communications to any party
hereunder shall
be in writing (including prepaid overnight courier, facsimile transmission
or
similar writing) and shall be given to the Borrower at the address
or facsimile
number set forth below and to the Lenders, the Security Agent and
the
Administrative Agent at their address and facsimile number set forth
in
Schedule 1 or at such other address or facsimile numbers as such party may
hereafter specify for the purpose by notice to each other party hereto.
Each
such notice, request or other communication shall be effective (i) if given
by facsimile, when such facsimile is transmitted to the facsimile
number
specified in this Section 17.1 and telephonic confirmation of receipt
thereof is
obtained or (ii) if given by mail, prepaid overnight courier or any other
means, when received at the address specified in this Section or
when delivery
at such address is refused.
If
to the
Borrower:
Seaspan
Corporation
Unit
2, 7
th
Floor, Bupa Centre
141
Connaught Road West
Hong
Kong F4 00000
Facsimile
+852 254 01689
Attention:
Kevin Kennedy, Chief Financial Officer
With
a copy to:
Seaspan
Ship Management Ltd.
Seaspan
Corporation
c/o
2600-200 Granville Street
Vancouver,
BC, Canada V6C 1S4
Facsimile
No.:
(604)
331-0925
Attention:
Gerry Wang
| 18. |
MISCELLANEOUS.
|
18.1
Time
of Essence
.
Time is
of the essence of this Agreement but no failure or delay on the part
of any
Lender to exercise any power or right under this Agreement shall
operate or be
construed as a waiver thereof, nor shall any single or partial exercise
by such
Lender of any power or right hereunder preclude any other or further
exercise
thereof or the exercise of any other right. The remedies provided
herein are
cumulative and are not exclusive of any remedies provided by law.
18.2
Unenforceable,
etc., Provisions-Effect
.
In case
any one or more of the provisions contained in this Agreement, the
Note or in
any Security Document would, if given effect, be invalid, illegal
or
unenforceable in any respect under any law applicable in any relevant
jurisdiction, said provision shall not be enforceable against the
Borrower, but
the validity, legality and enforceability of the remaining provisions
herein or
therein contained shall not in any way be affected or impaired
thereby.
18.3
References
.
References herein to Sections, Schedules and Exhibits are to be construed
as
references to sections of, exhibits to, and schedules to, this Agreement,
unless
the context otherwise requires.
18.4
Further
Assurances
.
The
Borrower agrees that if this Agreement, the Note or any of the Security
Documents shall at any time be deemed by the Administrative Agent,
the Security
Agent or the Lenders for any reason insufficient in whole or in part
to carry
out the true intent and spirit hereof or thereof, it will execute
or cause to be
executed such other and further assurances and documents as in the
reasonable
opinion of the Administrative Agent, the Security Agent or the Majority
Lenders
may be required in order more effectively to accomplish the purposes
of this
Agreement, the Note or any of the Security Documents.
18.5
Inconsistency
.
If
there is any inconsistency between the terms of this Agreement and
any other
Facility Document, the terms of this Agreement will govern.
18.6
Prior
Agreements, Merger
.
Any and
all prior understandings and agreements heretofore entered into between
the
Borrower on the one part, the Administrative Agent, the Security
Agent or the
Lenders, on the other part, whether written or oral, other than the
Fee Letter,
are superseded by and merged into this Agreement and the other agreements
(the
forms of which are exhibited hereto) to be executed and delivered
in connection
herewith to which the Borrower, the Administrative Agent, Security
Agent and/or
the Lenders are parties, which alone fully and completely express
the agreements
between the Borrower, the Administrative Agent, the Security Agent
and the
Lenders.
18.7
Entire
Agreement; Amendments; Counterparts
.
This
Agreement constitutes the entire agreement of the parties hereto,
including all
parties added hereto pursuant to an Assignment and Assumption Agreement.
Subject
to Section 16.8, any provision of this Agreement, the Note or any
Security
Document may be amended or waived if, but only if, such amendment
or waiver is
in writing and is signed by the Borrower, the Administrative Agent,
the Security
Agent and the Majority Lenders. This Agreement may be executed in
any number of
counterparts, each of which shall be deemed an original, but all
such
counterparts together shall constitute one and the same instrument.
18.8
Indemnification
.
The
Borrower agrees to indemnify each Creditor and their respective successors
and
permitted assigns, and their respective officers, directors, employees,
representatives and agents (each an “Indemnitee”) from, and hold each of them
harmless against, any and all losses, liabilities, claims, damages,
expenses,
obligations, penalties, actions, judgments, suits, costs or disbursements
of any
kind or nature whatsoever (including, without limitation, the reasonable
fees
and disbursements of counsel for such Indemnitee in connection with
any
investigative, administrative or judicial proceeding commenced or
threatened,
whether or not such Indemnitee shall be designated a party thereto)
that may at
any time (including, without limitation, at any time following the
payment of
the obligations of the Borrower hereunder) be imposed on, asserted
against or
incurred by, any Indemnitee as a result of, or arising out of or
in any way
related to or by reason of, (a) any violation by the Borrower (or any
charterer or other operator of the Collateral Vessels) of any applicable
Environmental Law, (b) any Environmental Claim arising out of the
management, use, control, ownership or operation of property or assets
by the
Borrower (or any charterer or other operator of the Collateral Vessels,
or,
after foreclosure, by any Lender, the Administrative Agent or the
Security Agent
or any of their respective successors or assigns), (c) the breach of any
representation, warranty or covenant set forth in Sections 2.1 (v) or
9.1(g), (d) the Facility (including the use of the proceeds of the
Facility and any claim made for any brokerage commission, fee or
compensation
from any Person), or (e) the execution, delivery, performance or
non-performance of this Agreement, the Note, any Security Document,
or any of
the documents referred to herein or contemplated hereby (whether
or not the
Indemnitee is a party thereto), provided that such indemnity shall
not, as to
any Indemnitee, be available to the extent that such losses, claims,
damages,
liabilities or related expenses are a result of the gross negligence,
bad faith
or willful misconduct of such Indemnitee. If and to the extent that
the
obligations of the Borrower under this Section are unenforceable
for any reason,
the Borrower agrees to make the maximum contribution to the payment
and
satisfaction of such obligations which is permissible under applicable
law. The
obligations of the Borrower under this Section 18.8 shall survive the
termination of this Agreement and the repayment to the Lenders of
all amounts
owing thereto under or in connection herewith.
18.9
Headings
.
In this
Agreement, section headings are inserted for convenience of reference
only and
shall not be taken into account in the interpretation of this
Agreement.
18.10
WAIVER
OF IMMUNITY
.
TO THE
EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY
FROM SUIT,
JURISDICTION OF ANY COURT OR ANY LEGAL PROCESS (WHETHER THROUGH ATTACHMENT
PRIOR
TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION, EXECUTION OF A JUDGMENT,
OR FROM
ANY OTHER LEGAL PROCESS OR REMEDY) WITH RESPECT TO ITSELF OR ITS
PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS
UNDER THIS AGREEMENT, THE NOTE AND THE OTHER SECURITY DOCUMENTS.
18.11
USA
Patriot Act Notice; OFAC and Bank Secrecy Act
.
The
Administrative Agent hereby notifies the Borrower that pursuant to
the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56,
signed into
law October 26, 2001) (the “Act”), and the Administrative Agent’s policies and
practices, the Administrative Agent and each of the Lenders is required
to
obtain, verify and record certain information and documentation that
identifies
the Borrower, which information includes the name and address of
the Borrower
and such other information that will allow the Administrative Agent
and the
Lenders to identify the Borrower in accordance with the Act. In addition,
the
Borrower shall (a) ensure that no Person who owns a controlling interest
in or
otherwise controls the Borrower or any subsidiary of any thereof
is or shall be
listed on the Specially Designated Nationals and Blocked Person List
or other
similar lists maintained by the Office of Foreign Assets Control
(“OFAC”), the
Department of the Treasury or included in any Executive Orders, (b)
not use or
permit the use of the proceeds of the Facility to violate any of
the foreign
asset control regulations of OFAC or any enabling statute or Executive
Order
relating thereto, and (c) comply, and cause any of its subsidiaries
to comply,
with all applicable Bank Secrecy Act laws and regulations, as amended.
IN
WITNESS whereof the parties hereto have caused this Agreement to
be executed by
their respective duly authorized representatives on the day and year
first above
written.
|
SEASPAN
CORPORATION
,
as
Borrower
|
||
|
|
|
|
| By: | ||
|
Name: |
||
| Title: | ||
|
DNB
NOR
BANK ASA
,
Sole
Bookrunner, Mandated Lead Arranger, Administrative Agent
and
Security
|
||
|
|
|
|
| By: | /s/ | |
|
Name: |
||
| Title: | ||
|
|
|
|
| By: | ||
|
Name: |
||
| Title | ||
The
Lenders:
| DnB NOR BANK ASA , as Lender | ||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
CREDIT
SUISSE
,
as
Mandated Lead Arranger and Lender
|
||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
FORTIS
CAPITAL CORP.
,
as Mandated Lead Arranger
and Lender
|
||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
LANDESBANK
HESSEN-TH
Ü
RINGEN
,
as Documentation
Agent and Lender
|
||
|
|
|
|
| Date: | By: | |
|
Name: |
||
| Title: | ||
|
BAYERISCHE
HYPO- UND VEREINSBANK
AG
,
as
Lender
|
||
|
|
|
|
| Date: | By: | |
|
Name: |
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DEUTSCHE
BANK AG IN HAMBURG
as
Lender
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CRÉDIT
INDUSTRIEL
ET
COMMERCIAL
,
as
Lender
|
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DEUTSCHE
SCHIFFSBANK
AG
,
as
Lender
|
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Schedule
1
The
Lenders and Initial Commitments
|
|
|
Lenders
|
Commitment
|
|
DnB
NOR BANK ASA
New
York Branch
200
Park Avenue, 31
st
Floor
New
York, New York 10166
Attn:
Jack Sun/Erlend Bryn
Facsimile
No.: +1-212-681-3900
|
$65,000,000
|
|
CREDIT
SUISSE
St.
Alban-Graben 1-3
P.O.
Box
CH-2002
Basel
Switzerland
Attn:
John Haefelfinger/Nadja Gautschi
Facsimile
No.: +41-61-266-7939
|
$50,000,000
|
|
FORTIS
CAPITAL CORP.
520
Madison Avenue, 3
rd
Floor
New
York, New York 10022
Attn:
Carl Rasmussen
Facsimile
No.: 212-340-5370
|
$50,000,000
|
|
LANDESBANK
HESSEN-THÜRINGEN
New
York Branch
420
Fifth Avenue
24
th
Floor
New
York, New York 10018-2729
Attn:
Gerhard Winklmeier
Facsimile
No.: +1-212-703-5256
|
$50,000,000
|
|
BAYERISCHE
HYPO- UND VEREINSBANK AG
Alter
Wall 22
20457
Hamburg
Germany
Attn:
Silvana Nicolini
Facsimile
No.: +49 40 3692 3696
|
$35,000,000
|
|
DEUTSCHE
BANK AG IN HAMBURG
Ludwig-Erhard-Strasse
1
D-20459
Hamburg
Germany
Attn:
Eva Neugebauer
Facsimile
No.: +49-40-3701-4649
|
$35,000,000
|
|
CRÉDIT
INDUSTRIEL ET COMMERCIAL
520
Madison Avenue, 37
th
Floor
New
York, NY 10022
Attn:
Alex Aupoix
Facsimile
No.: +1-212-715-4535
|
$30,000,000
|
|
DEUTSCHE
SCHIFFSBANK AG
Domshof
17
28195
Bremen
Germany
Attn:
Malte Schulte-Trux/Yves Kallina
Facsimile
No.: +49 421 3609 329
|
$50,000,000
|
Schedule
2
Commitment
Reduction Schedule
Schedule
3
Approved
Shipbrokers
Clarkson's
Fearnleys
Platou
Braemar
Bassoe
Simpson,
Spence & Young
Howe
Robinson
BRS
Alphaliner
S
chedule
4
Estimated
Addback Relating to Delivered Vessels
*
Depreciation
|
Date
|
Amount
of Add Back
(US$)
|
|
9/30/05
|
207,588,000
|
|
12/31/05
|
205,843,000
|
|
3/31/06
|
204,099,000
|
|
6/30/06
|
202,354,000
|
|
9/30/06
|
200,610,000
|
|
12/31/06
|
198,866,000
|
|
3/31/07
|
197,121,000
|
|
6/30/07
|
195,377,000
|
|
9/30/07
|
193,632,000
|
|
12/31/07
|
191,888,000
|
|
3/31/08
|
190,143,000
|
|
6/30/08
|
188,399,000
|
|
9/30/08
|
186,655,000
|
|
12/31/08
|
184,910,000
|
|
3/31/09
|
183,166,000
|
|
6/30/09
|
181,42,000
1
|
|
9/30/09
|
179,677,000
|
|
12/31/09
|
177,932,000
|
|
3/31/10
|
176,188,000
|
|
6/30/10
|
174,443,000
|
|
9/30/10
|
172,699,000
|
|
12/31/10
|
170,955,000
|
|
3/31/11
|
169,210,000
|
|
6/30/11
|
167,466,000
|
|
9/30/11
|
165,721,000
|
|
12/31/11
|
163,977,000
|
|
3/30/12
|
162,232,000
|
|
6/29/12
|
160,488,000
|
|
9/29/12
|
158,744,000
|
|
12/30/12
|
156,999,000
|
|
3/31/2013
|
155,255,000
|
|
6/30/2013
|
153,510,000
|
|
9/30/2013
|
151,766,000
|
|
12/31/2013
|
150,021,000
|
*
The
certain delivered vessels referred to in the definitions of Tangible
Net Worth
and Total Assets are the following vessels: