EXHIBIT 4.9
EXECUTION VERSION
USD 1,131,439,219
TERM LOAN FACILITY AGREEMENT
dated 3 February 2005
between
SHIP FINANCE INTERNATIONAL LIMITED
as borrower
THE OWNERS
listed in Schedule 1 as guarantors
DNB NOR BANK ASA,
NORDEA BANK NORGE ASA,
FORTIS BANK (Nederland) N.V.
CALYON S.A.
as mandated lead arrangers
THE PARTICIPATING LENDERS
listed in Schedule 2 as lenders
DNB NOR BANK ASA,
NORDEA BANK NORGE ASA,
as bookrunners
and
DNB NOR BANK ASA
as administrative agent and security agent
TABLE OF CONTENTS
1 DEFINITIONS AND INTERPRETATIONS.......................................1
1.1 DEFINITION........................................................1
1.2 CONSTRUCTION......................................................7
2 FACILITY AND PURPOSE..................................................8
2.1 FACILITY..........................................................8
2.2 LENDERS' RIGHTS AND OBLIGATIONS...................................8
2.3 PURPOSE...........................................................8
3 CONDITIONS PRECEDENT..................................................8
3.1 CONDITIONS PRECEDENT..............................................8
3.2 WAIVED CONDITIONS.................................................9
4 DRAWDOWN..............................................................9
4.1 DELIVERY OF A DRAWDOWN NOTICE.....................................9
4.2 COMPLETION OF THE DRAWDOWN NOTICE.................................9
4.3 LENDERS' PARTICIPATION............................................9
5 REPAYMENT.............................................................9
5.1 REPAYMENT OF LOAN.................................................9
5.2 NO RE-BORROWING..................................................10
6 PREPAYMENT...........................................................10
6.1 VOLUNTARY PREPAYMENT.............................................10
6.2 MANDATORY PREPAYMENT: SALE OR TOTAL LOSS.........................10
6.3 APPLICATION OF MANDATORY PREPAYMENTS.............................10
6.4 ILLEGALITY.......................................................10
6.5 RESTRICTIONS.....................................................11
7 INTEREST.............................................................11
7.1 CALCULATION OF INTEREST..........................................11
7.2 PAYMENT OF INTEREST..............................................11
7.3 INCREASED INTEREST...............................................11
8 INTEREST PERIODS.....................................................12
8.1 SELECTION OF INTEREST PERIODS....................................12
8.2 NON-BUSINESS DAYS................................................12
8.3 CONSOLIDATION....................................................12
9 CHANGES TO THE CALCULATION OF INTEREST...............................12
9.1 ABSENCE OF QUOTATIONS............................................12
9.2 MARKET DISRUPTION................................................13
9.3 ALTERNATIVE BASIS OF INTEREST OR FUNDING.........................13
9.4 BREAK COSTS......................................................13
10 FEES.................................................................13
10.1 COMMITMENT FEE...................................................13
10.2 OTHER FEES.......................................................13
11 TAX GROSS UP AND INDEMNITIES.........................................14
11.1 TAX GROSS-UP.....................................................14
11.2 TAX INDEMNITY....................................................14
11.3 TAX CREDIT.......................................................15
11.4 STAMP TAXES......................................................15
11.5 VALUE ADDED TAX..................................................15
12 INCREASED COSTS......................................................15
12.1 INCREASED COSTS..................................................15
12.2 INCREASED COST CLAIMS............................................16
13 OTHER INDEMNITIES....................................................16
13.1 CURRENCY INDEMNITY...............................................16
13.2 OTHER INDEMNITIES................................................16
13.3 INDEMNITY TO THE ADMINISTRATIVE AGENT............................16
14 COSTS AND EXPENSES...................................................17
14.1 TRANSACTION EXPENSES.............................................17
14.2 AMENDMENT COSTS..................................................17
14.3 ENFORCEMENT COSTS................................................17
15 SECURITY.............................................................17
15.1 SECURITY DOCUMENTS...............................................17
15.2 PRIORITY.........................................................17
15.3 SECURITY AGENT...................................................18
15.4 SET-OFF..........................................................18
16 REPRESENTATIONS......................................................18
16.1 STATUS...........................................................18
16.2 BINDING OBLIGATIONS..............................................18
16.3 NON-CONFLICT WITH OTHER OBLIGATIONS..............................18
16.4 POWER AND AUTHORITY..............................................18
16.5 VALIDITY AND ADMISSIBILITY IN EVIDENCE...........................18
16.6 GOVERNING LAW AND ENFORCEMENT....................................19
16.7 DEDUCTION OF TAX.................................................19
16.8 NO FILING OR STAMP TAXES.........................................19
16.9 NO DEFAULT OR NON-COMPLIANCE.....................................19
16.10 NO MISLEADING INFORMATION........................................19
16.11 FINANCIAL STATEMENTS.............................................20
16.12 PARI PASSU RANKING...............................................20
16.13 NO PROCEEDINGS PENDING OR THREATENED.............................20
16.14 INDEBTEDNESS/ENCUMBRANCES........................................20
16.15 OWNERSHIP........................................................20
16.16 REPETITION.......................................................20
17 INFORMATION UNDERTAKINGS.............................................20
17.1 FINANCIAL STATEMENTS.............................................21
17.2 COMPLIANCE CERTIFICATE...........................................21
17.3 REQUIREMENTS AS TO FINANCIAL STATEMENTS..........................21
17.4 INFORMATION: MISCELLANEOUS.......................................21
17.5 NOTIFICATION OF NON-COMPLIANCE...................................21
18 FINANCIAL COVENANTS..................................................22
18.1 MINIMUM VALUE....................................................22
18.2 FREE CASH........................................................22
18.3 WORKING CAPITAL..................................................22
18.4 MINIMUM EQUITY RATIO.............................................22
19 VESSEL UNDERTAKINGS..................................................22
19.1 REGISTRATION AND OWNERSHIP.......................................23
19.2 FLAG.............................................................23
19.3 CLASSIFICATION...................................................23
19.4 LAWS AND SAFETY MANAGEMENT.......................................23
19.5 MANAGEMENT AGREEMENT.............................................23
19.6 TECHNICAL CONDITION..............................................23
19.7 MAJOR STRUCTURAL ALTERATION......................................24
19.8 INSURANCES.......................................................24
19.9 ACCIDENT, TOTAL LOSS OR ARREST...................................25
19.10 RELEASE OF DISTRESS..............................................25
19.11 ENCUMBRANCES.....................................................25
19.12 COMMERCIAL MANAGEMENT............................................25
19.13 VALUATION........................................................25
20 CORPORATE UNDERTAKINGS...............................................26
20.1 NO CHANGE OF STATUS..............................................26
20.2 NO CHANGE OF CONTROL.............................................26
20.3 LISTING..........................................................26
20.4 NO CHANGE OF OWNERSHIP...........................................26
20.5 SCOPE OF BUSINESS................................................26
20.6 NO FURTHER BORROWING.............................................26
20.7 NO FURTHER INVESTMENTS...........................................27
20.8 NO DISTRIBUTION..................................................27
20.9 EARNINGS ACCOUNTS................................................27
20.10 AUTHORISATIONS...................................................27
20.11 COMPLIANCE WITH LAWS.............................................27
20.12 INTEREST HEDGING AGREEMENTS......................................27
20.13 MONEY LAUNDERING.................................................28
20.14 TRANSACTION DOCUMENTS............................................28
21 EVENTS OF NON-COMPLIANCE AND DEFAULT.................................28
21.1 EVENT OF NON-COMPLIANCE..........................................28
21.2 DEFAULT..........................................................30
21.3 ACCELERATION.....................................................30
21.4 REMEDY...........................................................30
22 GUARANTEE............................................................30
22.1 GUARANTEE AND INDEMNITY..........................................30
22.2 CONTINUING GUARANTEE.............................................31
22.3 REINSTATEMENT....................................................31
22.4 WAIVER OF DEFENCES...............................................31
22.5 IMMEDIATE RECOURSE...............................................32
22.6 APPROPRIATIONS...................................................32
22.7 DEFERRAL OF OWNERS' RIGHTS.......................................32
22.8 ADDITIONAL SECURITY..............................................33
22.9 OWNER'S RIGHT OF CONTRIBUTION....................................33
22.10 NO FRAUDULENT CONVEYANCE.........................................33
23 CHANGES TO THE LENDERS...............................................33
23.1 TRANSFERS BY THE LENDERS.........................................33
23.2 CONDITIONS OF TRANSFER...........................................33
23.3 LIMITATION OF RESPONSIBILITY OF EXISTING LENDERS.................34
23.4 PROCEDURE FOR TRANSFER...........................................34
24 CHANGES TO THE OBLIGORS..............................................35
25 ROLE OF THE ADMINISTRATIVE AGENT.....................................35
25.1 APPOINTMENT OF THE ADMINISTRATIVE AGENT..........................35
25.2 DUTIES OF THE ADMINISTRATIVE AGENT...............................35
25.3 NO FIDUCIARY DUTIES..............................................36
25.4 BUSINESS WITH THE OBLIGORS.......................................36
25.5 RIGHTS AND DISCRETIONS OF THE ADMINISTRATIVE AGENT...............36
25.6 MAJORITY LENDERS' INSTRUCTIONS...................................36
25.7 RESPONSIBILITY FOR DOCUMENTATION.................................37
25.8 EXCLUSION OF LIABILITY...........................................37
25.9 LENDER'S INDEMNITY TO THE ADMINISTRATIVE AGENT...................37
25.10 RESIGNATION OF THE ADMINISTRATIVE AGENT..........................38
25.11 CONFIDENTIALITY..................................................38
25.12 RELATIONSHIP WITH THE LENDERS....................................38
25.13 CREDIT APPRAISAL BY THE LENDERS..................................38
25.14 DEDUCTION FROM AMOUNTS PAYABLE BY THE ADMINISTRATIVE AGENT.......39
26 SHARING AMONG THE FINANCE PARTIES....................................39
26.1 PAYMENT TO FINANCE PARTIES.......................................39
26.2 REDISTRIBUTION OF PAYMENTS.......................................39
26.3 RECOVERING FINANCE PARTY'S RIGHTS................................39
26.4 REVERSAL OF REDISTRIBUTION.......................................40
26.5 EXCEPTIONS.......................................................40
27 PAYMENT MECHANICS....................................................40
27.1 PAYMENTS TO THE ADMINISTRATIVE AGENT.............................40
27.2 DISTRIBUTIONS BY THE ADMINISTRATIVE AGENT........................40
27.3 DISTRIBUTIONS TO THE BORROWER....................................41
27.4 CLAWBACK.........................................................41
27.5 PARTIAL PAYMENTS.................................................41
27.6 NO SET-OFF BY THE BORROWER.......................................41
27.7 BUSINESS DAYS....................................................42
28 NOTICES..............................................................42
28.1 COMMUNICATIONS IN WRITING........................................42
28.2 ADDRESSES........................................................42
28.3 NOTIFICATION OF ADDRESS AND FAX NUMBER...........................43
28.4 ENGLISH LANGUAGE.................................................43
29 CALCULATIONS AND CERTIFICATES........................................43
29.1 ACCOUNTS.........................................................43
29.2 CERTIFICATES AND DETERMINATIONS..................................44
29.3 DAY COUNT CONVENTION.............................................44
30 PARTIAL INVALIDITY...................................................44
31 AMENDMENTS...........................................................44
31.1 AMENDMENTS.......................................................44
31.2 CONSENT..........................................................44
31.3 TECHNICAL AMENDMENTS.............................................45
31.4 AMENDMENTS AFFECTING THE ADMINISTRATIVE AGENT....................45
32 REMEDIES AND WAIVERS.................................................45
33 GOVERNING LAW AND JURISDICTION.......................................45
33.1 GOVERNING LAW....................................................45
33.2 JURISDICTION.....................................................45
SCHEDULE 1...............................................................46
THE OWNERS AND THE VESSELS.............................................46
SCHEDULE 2...............................................................49
THE ORIGINAL LENDERS...................................................49
SCHEDULE 3...............................................................53
PART I...................................................................53
CONDITIONS PRECEDENT TO THE DELIVERY OF THE FIRST DRAWDOWN NOTICE......53
PART II..................................................................54
CONDITIONS PRECEDENT TO THE DELIVERY OF EACH DRAWDOWN NOTICE...........54
PART III.................................................................55
CONDITIONS PRECEDENT TO EACH DRAWDOWN DATE.............................55
SCHEDULE 4...............................................................56
FORM OF DRAWDOWN NOTICE................................................56
SCHEDULE 5...............................................................57
FORM OF SELECTION NOTICE...............................................57
SCHEDULE 6...............................................................58
FORM OF TRANSFER CERTIFICATE...........................................58
SCHEDULE 7...............................................................59
COMPLIANCE CERTIFICATE.................................................59
SCHEDULE 8...............................................................60
INTEREST NOTIFICATION..................................................60
SCHEDULE 9...............................................................61
SECURITY DOCUMENTS.....................................................61
SCHEDULE 10..............................................................63
GUARANTEE/SECURITY RELEASE LETTER......................................63
SCHEDULE 11..............................................................64
REPAYMENT..............................................................64
(COLUMN "REPAYMENT 1-23" CORRESPONDS TO THE AMOUNT REPAYABLE FOR EACH
VESSEL ON EACH REPAYMENT DATE NO 1-23 - AND COLUMN "REPAYMENT 24"
CORRESPONDS TO THE AMOUNT REPAYABLE FOR EACH VESSEL ON THE FINAL
REPAYMENT DATE)........................................................64
(ALL AMOUNTS IN USD)...................................................64
34 SIGNATORIES..........................................................66
EXHIBITS:
Exhibit A: Form of Mortgages
-Liberia
-Bahamas
-Xxxxxxxx Island
-NIS
-Panama
-Singapore
-Isle of Man
Exhibit B: Form of Owners' General Assignment
Exhibit C: Form of Owners' Contract Assignment
Exhibit D: Form of Earnings Account Charge
Exhibit E: Form of Pledge of Shares
Exhibit F: Form of Borrower's General Assignment
Exhibit G: Form of Charter Accounts Pledge Assignment
THIS TERM LOAN FACILITY AGREEMENT (the "Agreement") is made this 3rd day of
February 2005
BETWEEN
(1) SHIP FINANCE INTERNATIONAL LIMITED of Par-la-Ville Place, 00 Xxx-xx-Xxxxx
Xxxx, Xxxxxxxx, XX00, Bermuda as borrower (the "Borrower"),
(2) THE OWNERS listed in Schedule 1 as guarantors (the "Owners"),
(3) DNB NOR BANK ASA, NORDEA BANK NORGE ASA, FORTIS BANK (NEDERLAND) N.V (Oslo
Branch) and CALYON S.A (the "Mandated Lead Arrangers"),
(4) THE PARTICIPATING LENDERS listed in Schedule 2 as lenders (the
"Original Lenders"),
(5) DNB NOR BANK ASA and NORDEA BANK NORGE ASA as bookrunners (the
"Bookrunners"),
(6) DNB NOR BANK ASA as administrative agent (the "Administrative Agent") and
(7) DNB NOR BANK ASA as security agent (the "Security Agent").
IT IS HEREBY AGREED as follows:
1 DEFINITIONS AND INTERPRETATIONS
1.1 Definition
In this Agreement:
"Administrative Services Agreement" means the administrative services agreement
entered into on the 1 January 2004 as amended from time to time between the
Borrower, the Owners and the Manager.
"Availability Period" means the period from and including the date hereof to and
including 30 April 2005 or a later date to which the Agent (on behalf of the
Majority Lenders) has consented in writing.
"Bareboat Charter" means each of the bareboat charter agreements as amended from
time to time entered into between:
(a) Frontline Ltd and Shell Tankers UK dated 17 October 2003 in respect of
"Front Opalia";
(b) Golden Current Ltd and Frontline Ltd dated 12 March 2004 in respect of
"Front Opalia";
(c) Frontline Ltd and Shell Tankers UK dated 17 October 2003 in respect of
"Xxxxx";
(d) Golden Fjord Corp. and Frontline Ltd dated 16 April 2004 in respect of
"Xxxxx";
(e) Frontline Ltd and Shell Tankers UK dated 17 October 2003 in respect of
"Omala";
(f) Golden Tide Corp. and Frontline Ltd dated 2 April 2004 in respect of
"Omala";
(g) Frontline Ltd and Shell Tankers UK dated 17 October 2003 in respect of
"Otina";
(h) Hitachi Hull 4983 Ltd .and Frontline Ltd dated 16 April 2004 in respect
of "Otina"; and
(i) Golden Bayshore Shipping Corporation and Argent Shipping Corporation
dated 13 March 1995; in respect of "Navix Astral".
"Borrower's General Assignment" means an assignment by the Borrower in
respect of
(a) the Floating Charge;
(b) the Performance Guarantee;
(c) the Charter Ancillary Agreement;
(d) the Charterer Share Pledge; and
(e) the Administrative Services Agreement.
"Break Costs" means the amount (if any) by which:
(a) the interest which a Lender should have received less the Margin for the
period from the date of receipt of all or any part of its participation
in the Loan or an Unpaid Sum to the current Interest Payment Date in
respect of the Loan or an Unpaid Sum, had the principal amount or Unpaid
Sum received been paid on that Interest Payment Date;
exceeds:
(b) the amount which that Lender would be able to obtain by placing an amount
equal to the principal amount or Unpaid Sum received by it on deposit
with a leading bank in the London Interbank market for a period starting
on the Business Day following receipt or recovery and ending on the next
Interest Payment Date.
"Business Day" means a day (other than a Saturday or Sunday) on which banks are
open for general business in London, New York, Oslo and/or such other places
where disbursement of money will be made under this Agreement.
"Charter Accounts" means an account of the Charterer maintained (in respect of
(x) the Charter Service Reserve Deposit and (y) any charter hire paid pursuant
to third party charters) with (a) Nordea Bank Norge ASA under the number
6011.04.43628 and (b) (in respect of (x) exclusively) each account maintained
with another financial institution which has a rating of at least A from
Standard & Poor's Ratings Services and at least A2 from Moody's Investor's
Services, Inc. and is subject to an encumbrance in favour of the Security Agent
in form and substance satisfactory to it.
"Charter Accounts Pledge" means a pledge of the Charter Accounts between the
Charterer as pledgor and the Borrower as pledgee.
"Charter Accounts Pledge Assignment" means an assignment of the Charter Accounts
Pledge between the Borrower as pledgor and the Security Agent as pledgee.
"Charter Ancillary Agreement" means the charter ancillary agreement entered into
on the 1 January 2004 as amended from time to time between the Borrower,
Frontline Ltd., Bermuda, the Charterer and the Owners.
"Charterer" means Frontline Shipping Limited, a special purpose company
incorporated in Bermuda.
"Charter Service Reserve Deposit" means the portion of the amount from time to
time standing to the credit of the Charter Accounts which has been deposited
pursuant to Article 2.1 (Charter Service Reserve) of the Charter Ancillary
Agreement and which is to be maintained in accordance with the Transaction
Documents.
"Charterer Share Pledge" means a share pledge in respect of the shares of the
Charterer between Frontline Ltd., Bermuda as pledgor and the Borrower as
pledgee.
"Commercial Management Agreement" means the commercial management agreement as
amended from time to time between the Charterer and the Manager.
"Commitment" means the amount set opposite each Lender in Schedule 2 (The
Original Lenders) (including any other Commitment transferred to it or a New
Lender under this Agreement) which aggregates USD 1,131,439,219.
"Compliance Certificate" means a certificate substantially in the form set out
in Schedule 7 (Form of Compliance Certificate).
"Default" means the situation occurring following the Administrative Agent's
notification to the Borrower pursuant to Clause 21.2 (Default).
"DOC" means a Document of Compliance issued pursuant to the ISM Code.
"Drawdown Date" means a Business Day on which the Borrower has requested a
drawdown of one or several Tranches pursuant to this Agreement or, as the
context requires, the date on which a Tranche is actually advanced.
"Drawdown Notice" means a notice substantially in the form set out in Schedule
4.
"Earnings" means the Borrower's and/or the Owners' (as the case may be) right to
all hire and other claim for moneys, net salvage and towage remuneration,
detention moneys, damages and any other payments in respect of its Vessel.
"Earnings Account" means the Borrower's deposit account no. 5011.04.43215 with
the Administrative Agent.
"Earnings Account Charge" means the charge of the Earnings Account as required
by Schedule 9 (Security Documents) and as set out in Exhibit D.
"Environmental Approval" means any consent, authorisation, licence or approval
of any governmental or public body or authorities or courts, applicable to the
Vessels or their operation required under any Environmental Law.
"Environmental Laws" means all national, international and state laws, rules,
regulations, treaties and conventions applicable to the Vessels, pertaining to
the pollution or protection of human health or the environment including,
without limitation, the carriage of oil and other pollutants and actual or
threatened emissions, spills, releases or discharges of oil and other
pollutants.
"Event of Non-compliance" means each of the events and/or circumstances
described in Clause 21.1 (Event of Non-compliance).
"Finance Documents" means as amended from time to time, this Agreement, any
Security Document, the Interest Hedging Agreements and any other document
designated as such by the Administrative Agent and the Borrower.
"Finance Party" means the Administrative Agent, the Security Agent or a Lender.
"Floating Charge" means a floating charge between the Charterer as chargor and
the Borrower as chargee.
"Free Cash" means:
(a) cash in hand or on freely available deposit with the Administrative
Agent;
(b) freely available securities issued or directly and fully guaranteed or
insured by the United States Government or any agency or instrumentality
of the United States (provided that the full faith and credit of the
United States is pledged in support thereof), having maturities of not
more than one year from the date of acquisition;
(c) freely available marketable general obligations issued by any state of
the United States of America or any political subdivision of any such
state or any public instrumentality thereof maturing within one year from
the date of acquisition and, at the time of acquisition, having a credit
rating of "A" or better from either Standard & Poor's Ratings Services or
Xxxxx'x Investors Service, Inc.;
(d) freely available certificates of deposit, time deposits, Eurodollar time
deposits, overnight bank deposits or bankers' acceptances having
maturities of not more than one year from the date of acquisition thereof
issued by any bank or financial institution the long-term debt of which
is rated at the time of acquisition thereof at least "A" or the
equivalent thereof by Standard & Poor's Ratings Services, or "A" or the
equivalent thereof by Xxxxx'x Investors Services, Inc., and having
combined capital and surplus in excess of USD 500,000,000;
(e) freely available repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses
b), c) and d) entered into with any bank meeting the qualifications
specified in clause d) above;
(f) freely available commercial paper rated at the time of acquisition
thereof at least "A-2" or the equivalent thereof by Standard & Poor's
Ratings Services or "P-2" or the equivalent thereof by Xxxxx'x Investors
Service, Inc., or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies cease
publishing ratings of investments, and in any case maturing within one
year after the date of acquisition thereof; and
(g) freely available interests in any investment company or money market fund
which only invests in instruments of the type specified in clauses (b)
through (f) above.
"GAAP" means generally accepted accounting principles in the United States of
America.
"Guarantee" means the guarantee executed by the Owners as set out in Clause 22.
"Hedge Counterparty" means each bank or financial institution which is a party
to an Interest Hedging Agreement and "Hedge Counterparties" means all such banks
and financial institutions.
"Insurance Report and Certificate" means, in relation to a Vessel:
(a) a report prepared by Xxxxx Marine & Energy AS confirming inter alia full
details of the Insurance in place for such Vessel, the identity of each
insurance company, underwriter and/or club providing such Insurance and
further confirming that such Insurance is consistent with the terms of
the Mortgage and/or the General Assignment (as applicable) entered into
or to be entered into in relation to such Vessel pursuant to this
Agreement, as well as (in each case) the terms of Clause 19.8
(Insurances) and
(b) a certificate signed by an authorised signatory of Xxxxx Marine & Energy
AS confirming (in its professional judgement) that the contents of such
report is accurate and that adequate Insurance is in place in respect of
the relevant Vessel.
"Interest Hedging Agreements" means the interest swap agreements (with schedules
and confirmations) as amended from time to time entered into between:
(a) Citibank N.A and the Borrower dated 18 February 2004;
(b) DnB NOR Bank ASA and the Borrower dated 11 February 2004;
(c) Fortis Bank (Nederland) N.V. and the Borrower dated 16 February 2004;
(d) HSH Nordbank AG and the Borrower dated 17 February 2004;
(e) Nordea Bank Finland Plc and the Borrower dated 10 February 2004;
(f) Scotiabank Europe plc. and the Borrower dated 18 February 2004; and
(g) Skandinaviska Enskilda Xxxxxx XX and the Borrower dated 19 February 2004.
"Interest Payment Date" means the last day of each Interest Period.
"Interest Period" means, in relation to the Loan, each period determined in
accordance with Clause 8 (Interest Periods) and, in relation to an Unpaid Sum
other than payment of any principal, each period determined in accordance with
Clause 7.3 (b) (Default interest).
"ISM Code" means the International Safety Management Code as adopted by the
International Maritime Organization's ("IMO").
"ISPS Code" means the International Ship and Port Facility Security (ISPS) Code
as adopted by IMO.
"Lender" means:
(a) any Original Lender; and
(b) any bank, financial institution, trust, fund or other entity which has
become a Party in accordance with Clause 23 (Changes to the Lenders),
which in each case has not ceased to be a Party in accordance with the terms of
this Agreement.
"LIBOR" means, in relation to the Loan:
(a) the applicable Screen Rate; or
(b) (if no Screen Rate is available for USD for the Interest Period of the
Loan) the arithmetic mean of the rates as supplied to the Administrative
Agent at its request quoted by the Reference Banks to leading banks in
the London interbank market,
not later than 11:00 GMT hours on the Quotation Day for the offering of deposits
in USD and for a period comparable to the Interest Period for the Loan.
"Loan" means the loan made or to be made pursuant to this Agreement or the
principal amount outstanding for the time being of the loan.
"Majority Lenders" means a Lender or Lenders whose participations in the
Commitment and/or the Loan aggregate more than 66% of the Loan outstanding.
"Management Agreement" means each of the management agreements as amended from
time to time entered into in relation to a Vessel between the Manager and the
relevant Owner comprising of a "Xxxxxxx 98" Baltic and International Maritime
Council standard ship management agreement together with the riders attached
thereto.
"Manager" means Frontline Management (Bermuda) Limited, a company
incorporated in Bermuda.
"Margin" means 0,70 per cent. per annum.
"Material Adverse Effect" means a material adverse effect on any Obligor's
financial position, business, operation, its abilities to comply with the
Finance Documents or the validity or enforceability of the Finance Documents.
"Mortgage" means a mortgage and (if relevant) the corresponding deed of
covenants over a Vessel as required by Schedule 9 (Security Documents) and as
set out in Exhibit A.
"Obligors" means the Borrower and the Owners and "Obligor" means any of them.
"Original Financial Statements" means the un-audited financial statements of the
Borrower for the first 9 months of 2004, ended 30 September 2004.
"Owner" means a legal and registered owner of a Vessel according to Schedule 1.
"Owners' Contract Assignment" means an assignment executed by the Owners as
required by Schedule 9 (Security Documents) and as set out in Exhibit C in
respect of the following documents:
(a) each Management Agreement;
(b) the Administrative Services Agreement;
(c) the Charter Ancillary Agreement;
(d) each Time Charter Party;
(e) each Bareboat Charter; and
(f) the Performance Guarantee.
"Owners' General Assignment" means an assignment of the Earnings and the
Insurances of a Vessel as required by Schedule 9 (Security Documents) and as set
out in Exhibit B.
"Party" means a party to a Finance Document.
"Performance Guarantee" means the guarantee executed by Frontline Ltd., Bermuda
for the performance of the obligations of the Charterer under the Time Charter
Parties (other than the payment of charter hire) and the obligations of the
Manager under the Management Agreements and the Administrative Service
Agreement.
"Pledge of Shares" means the pledge of shares as required by Schedule 9
(Security Documents) and as set out in Exhibit E.
"Quotation Day" means, in relation to any period for which an interest rate is
to be determined, two Business Days before the first day of that period.
"Reference Banks" means the Administrative Agent and such other banks or
financial institutions as may be agreed between the Borrower and the Lenders.
"Repayment Date" means each date falling at three (3) monthly intervals after
the first Drawdown Date.
"Screen Rate" means the British Bankers' Association Interest Settlement Rate
for USD for the relevant period, displayed on page LIBOR01 and LIBOR02 of the
Reuters screen. If the agreed page is replaced or service ceases to be
available, the Administrative Agent may specify another page or service
displaying the appropriate rate after consultation with the Borrower and the
Lenders.
"Security Document" means all or any document as may be entered into from time
to time pursuant to Schedule 9 (Security Documents).
"Selection Notice" means a notice substantially in the form set out in Schedule
5 given in accordance with Clause 8 (Interest Periods).
"Senior Note Default" means an event of default (however described and subject
to any applicable grace periods) under the Senior Note Documents.
"Senior Note Documents" means any agreement or document entered into or executed
in connection with the USD 580,000,000 senior unsecured notes due 2013 issued by
the Borrower.
"Ship's Value" means the value of a Vessel calculated according to Clause 19.13
(Valuation).
"SMC" means a Safety Management Certificate issued pursuant to the ISM Code.
"Tax" means any tax, levy, impost, duty or other charge or withholding of a
similar nature (including any penalty or interest payable in connection with any
failure to pay or any delay in paying any of the same).
"Time Charter Parties" means each of the time charter parties entered into
between the Charterer (or, if applicable, any other charterer) and the relevant
Owner in relation to the applicable Vessel.
"Total Loss" means the total loss of a Vessel as defined in Clause 19.9 (ii)
(Accident, Total Loss or arrest).
"Tranche" means a portion of the Commitment set opposite each Vessel in Schedule
1.
"Transaction Documents" means:
(a) each Management Agreement;
(b) the Performance Guarantee;
(c) the Administrative Services Agreement;
(d) the Charter Ancillary Agreement;
(e) each Time Charter Party;
(f) the Commercial Management Agreement;
(g) the Floating Charge;
(h) the Charterer Share Pledge; and
(j) the Charter Accounts Pledge.
"Unpaid Sum" means any sum due and payable but unpaid by the Borrower under the
Finance Documents.
"USD" means the lawful currency of the United States of America.
"Vessel" means a vessel listed in Schedule 1 as amended from time to time until
or unless such vessel has been sold or becomes a Total Loss.
1.2 Construction
(a) Unless a contrary indication appears, any reference in this Agreement to:
(i) the "Administrative Agent", the Security Agent, any "Finance
Party", any "Lender" or any "Party" shall be construed so as to
include its successors in title, permitted assigns and permitted
transferees;
(ii) a "Finance Document" or any other agreement or instrument is a
reference to that Finance Document or other agreement or
instrument as amended or novated;
(iii) "indebtedness" includes any obligation (whether incurred as
principal or as surety) for the payment or repayment of money,
whether present or future, actual or contingent;
(iv) a "regulation" includes any regulation, rule, official directive,
request or guideline (whether or not having the force of law) of
any governmental, intergovernmental or supranational body, agency,
department or regulatory, self-regulatory or other authority or
organisation;
(v) a provision of law is a reference to that provision as amended or
re-enacted; and
(vi) a time of day is a reference to Oslo time, unless otherwise
specified.
(b) Clause and Schedule headings are for ease of reference only.
(c) Unless a contrary indication appears, a term used in any other Finance
Document or in any notice given under or in connection with any Finance
Document has the same meaning in that Finance Document or notice as in
this Agreement.
2 FACILITY AND PURPOSE
2.1 Facility
Subject to the terms of this Agreement, the Lenders shall make available to the
Borrower, in the maximum of forty six (46) Tranches (one Tranche for each Vessel
and each Tranche in the maximum amount as set out in Schedule 1), a term loan
facility in the currency and in the aggregate amount of up to the Commitment.
2.2 Lenders' rights and obligations
(a) The obligations of each Lender under the Agreement are several. Failure
by a Lender to perform its obligations under the Agreement does not
affect the obligations of any other Party under the Finance Documents. No
Lender is responsible for the obligations of any other Lender under the
Agreement.
(b) The rights of each Lender under or in connection with the Finance
Documents are separate and independent rights and any debt arising under
the Finance Documents to a Finance Party from the Borrower shall be a
separate and independent debt.
2.3 Purpose
The Borrower shall apply the amount borrowed by it under the Agreement to
refinance the existing USD 1,058,000,000 credit facility agreement dated 17
February 2004 and general corporate purposes.
3 CONDITIONS PRECEDENT
3.1 Conditions precedent
The Lenders will only be obliged to make a Tranche available if on the requested
Drawdown Date:
(a) the Administrative Agent has received and approved all of the documents
and other evidence listed in Part I of Schedule 3 (Conditions precedent)
prior to delivery of the first Drawdown Notice, the documents and other
evidence listed in Part II of Schedule 3 (Conditions precedent) prior to
delivery of each Drawdown Notice and the documents and other evidence
listed in Part III of Schedule 3 (Conditions precedent) prior to each
Drawdown Date, all in form and substance satisfactory to the
Administrative Agent;
(b) no Event of Non-compliance is existing; and
(c) the repeating representations to be made by the Borrower in accordance
with Clause 16.16 (Repetition) are true in all material respects.
3.2 Waived conditions
If the Lenders in their sole discretion permit the drawdown of a Tranche before
all the conditions have been satisfied, the Borrower shall within one month from
such Drawdown Date or such other period as the Administrative Agent may decide
fulfil such conditions in form and substance satisfactory to the Administrative
Agent.
4 DRAWDOWN
4.1 Delivery of a Drawdown Notice
The Borrower may only draw a Tranche by delivery to the Administrative Agent of
a duly completed Drawdown Notice not later than 11:00 hours three Business Days
prior to the relevant Drawdown Date. The Administrative Agent shall notify the
Lenders promptly upon such notice being received.
4.2 Completion of the Drawdown Notice
A Drawdown Notice is irrevocable and will only be regarded as having been duly
completed if:
(a) the requested Drawdown Date is a Business Day within the Availability
Period;
(b) the requested amounts aggregated with the amounts requested in previous
Drawdown Notices do not exceed the Commitment, and each Tranche does not
exceed the amount set out in Schedule 1 and the Obligor complies with
Clause 18.1 (Minimum Value); and
(c) the requested Interest Period complies with Clause 8 (Interest periods).
4.3 Lenders' participation
(a) If the conditions set out in this Agreement have been met, each Lender
shall make its participation in the Loan available by the Drawdown Date.
(b) The amount of each Lender's participation in the Loan will be equal to
the proportion that its Commitment bears to the total of the Commitment
of all the Lenders according to Schedule 2.
5 REPAYMENT
5.1 Repayment of Loan
The Borrower shall repay the Loan on each Repayment Date by 24 consecutive
quarterly instalments each in the amount equal to the aggregate of the amounts
set opposite each Vessel for the relevant quarter from 1-24 in Schedule 11
(Repayment) (as the column "Repayment 1-23" in Schedule 11 represents each
quarterly instalment from 1-23 and the column "Repayment 24" represents the 24th
quarterly instalment for each Vessel), the first instalment falling due three
months after the first Drawdown Date. Notwithstanding anything in this
Agreement, all amounts outstanding hereunder shall be repaid within 72 months
from the first Drawdown Date.
5.2 No re-borrowing
The Borrower may not re-borrow any repaid part of the Loan.
6 PREPAYMENT
6.1 Voluntary prepayment
The Borrower may prepay the Loan in whole or in part in multiples of USD 500,000
upon giving the Administrative Agent not less than three (3) Business Days
irrevocable written notice of such prepayment. Voluntary prepaid amounts shall
be applied pro rata to the remaining repayment instalments.
6.2 Mandatory prepayment: Sale or Total Loss
In the event of the sale or Total Loss of a Vessel:
(a) the Borrower shall prepay a sum equal to the aggregate amounts set
opposite the Vessel involved in Schedule 11 that remains to be repaid
just prior to the sale or the occurrence leading to the Total Loss; and
(b) the instalments in respect of the repayment of the Loan stipulated in
Clause 5.1 (Repayment of Loan) shall be reduced with a corresponding
amount in accordance with Schedule 11.
Prepayment shall take place upon the delivery of such Vessel in the event of a
sale and the receipt of the insurance proceeds in the event of a Total Loss.
Upon receipt of the prepaid amount according to this Clause, the Administrative
Agent shall on behalf of the Lenders release the Owner of the Vessel involved
from its guarantee responsibility, the Mortgage relative to the Vessel involved
and the other Security Documents under this Agreement related to the Vessel and
the relevant Owner in the form as set out in Schedule 10.
6.3 Application of Mandatory Prepayments
(a) Any prepayment made pursuant to Clause 6.2 (Mandatory prepayment: Sale or
Total Loss) shall be applied in or towards the amount that remains to be
repaid in connection with the Vessel involved in accordance with Schedule
11;
(b) Other mandatory prepayments made pursuant to this Agreement (on the basis
of Clause 18.1 (Minimum Value) or otherwise) shall be applied pro rata in
or towards the remaining installments.
6.4 Illegality
If it becomes unlawful in any applicable jurisdiction for a Lender to perform
any of its obligations as contemplated by this Agreement or to fund or maintain
its participation in the Loan:
(a) that Lender shall promptly notify the Administrative Agent upon becoming
aware of that event;
(b) upon the Administrative Agent notifying the Borrower, the Commitment of
that Lender will be immediately cancelled; and
(c) the Borrower shall repay that Lender's participation in the Loan on the
Interest Payment Date occurring after the Administrative Agent has
notified the Borrower or, if earlier, the date specified by that Lender
in the notice delivered to the Administrative Agent (being no earlier
than the last day of any applicable grace period permitted by law).
6.5 Restrictions
(a) Any notice of prepayment given by any Party under this Clause 6 shall be
irrevocable and, unless a contrary indication appears in this Agreement,
shall specify the date upon which the prepayment is to be made and the
amount of the prepayment.
(b) Any prepayment under this Agreement shall be made together with accrued
interest on the amount prepaid and, subject to any Break Costs, without
premium or penalty.
(c) The Borrower may not re-borrow any prepaid part of the Loan.
7 INTEREST
7.1 Calculation of interest
The rate of interest on the Loan for each Interest Period is the percentage rate
per annum which is the aggregate of the Margin and LIBOR.
For the purpose of the Norwegian Financial Contracts Act 1999 the Borrower has
been informed of the nominal and effective interest rate by a letter from the
Administrative Agent substantially in the form set out in Schedule 8.
7.2 Payment of interest
The Borrower shall pay accrued interest on the Loan on each Interest Payment
Date and, if the Interest Period is longer than three months, on the dates
falling at three monthly intervals after the first day of the Interest Period.
7.3 Increased interest
(a) If a Default has occurred and is continuing, interest shall accrue on the
Loan from the date a notice as set forth in Clause 21.2 was received by
the Borrower until the earlier of (i) the Administrative Agent (acting
under the instruction of the Majority Lenders) declaring in writing to
the Borrower that such Default no longer is considered in existence or
waived (ii) the date all amounts due from the Borrower to the Finance
Parties hereunder have been repaid at a rate which is two percentage
points higher than the rate which would otherwise have been applicable.
(b) If there is an Unpaid Sum, interest shall accrue on such Unpaid Sum from
the due date up to the date of actual payment (both before and after
judgment) at a rate which is two percentage points higher than the rate
which would have been payable if the Unpaid Sum had, during the period of
non-payment, constituted a part of the Loan in the currency of the Unpaid
Sum for successive Interest Periods, each of a duration selected by the
Administrative Agent (acting reasonably). Any interest accruing under
this Clause 7.3 (b) shall be immediately payable by the Borrower on
demand by the Administrative Agent.
(c) Increased interest (if unpaid) arising on any Unpaid Sum will be
compounded with the Unpaid Sum at the end of each Interest Period
applicable to that Unpaid Sum but will remain immediately due and
payable.
8 INTEREST PERIODS
8.1 Selection of Interest Periods
(a) The Borrower shall select an Interest Period for each Tranche in the
Drawdown Notice or (if the Loan has already been borrowed) in a Selection
Notice.
(b) Each Selection Notice for the Tranche is irrevocable and must be
delivered to the Administrative Agent by the Borrower not later than
11:00 hours three Business Days prior to the expiry of the relevant
Interest Period.
(c) If the Borrower fails to deliver a Selection Notice to the Administrative
Agent in accordance with paragraph (b) above, the relevant Interest
Period will be three months.
(d) The Borrower may select an Interest Period of one, three, six, nine or
twelve months or any other period agreed between the Borrower and the
Administrative Agent.
(e) An Interest Period shall not extend beyond the last Repayment Date.
(f) Each Interest Period shall start on the Drawdown Date or (if already
made) on the preceding Interest Payment Date.
8.2 Non-Business Days
If an Interest Period would otherwise end on a day which is not a Business Day,
that Interest Period will instead end on the next Business Day in that calendar
month (if there is one) or the preceding Business Day (if there is not).
8.3 Consolidation
Following the first Drawdown Date, the Borrower shall select Interest Periods
for the forthcoming Tranches which shall coincide and the Tranches will, unless
the Administrative Agent specifies to the contrary, be consolidated into, and
treated as, a single Loan.
9 CHANGES TO THE CALCULATION OF INTEREST
9.1 Absence of quotations
Subject to Clause 9.2 (Market disruption), if LIBOR is to be determined by
reference to the Reference Banks but a Reference Bank does not supply a
quotation not later than 11:00 hours on the Quotation Day, the applicable LIBOR
shall be determined on the basis of the quotations of the remaining Reference
Banks.
9.2 Market disruption
(a) If a Market Disruption Event occurs in relation to the Loan for any
Interest Period, then the rate of interest on each Lender's participation
in the Loan for that Interest Period shall be the rate per annum which is
the sum of the Margin and the rate notified to the Administrative Agent
by that Lender as soon as practicable and in any event before interest is
due to be paid in respect of that Interest Period, to be that which
expresses as a percentage rate per annum the cost to that Lender of
funding the Loan from whatever source it may reasonably select.
(b) In this Agreement "Market Disruption Event" means at or about 11:00 hours
GMT on the Quotation Day for the relevant Interest Period the Screen Rate
is not available and none of the Reference Banks supplies a rate to the
Administrative Agent to determine LIBOR for USD for the relevant Interest
Period.
9.3 Alternative basis of interest or funding
(a) If a Market Disruption Event occurs and the Administrative Agent or the
Borrower so requires, the Administrative Agent and the Borrower shall
enter into negotiations (for a period of not more than thirty days) with
a view to agreeing a substitute basis for determining the rate of
interest.
(b) Any alternative basis agreed pursuant to the paragraph above shall, with
the prior consent of all the Lenders and the Borrower, be binding on all
Parties.
9.4 Break Costs
(a) The Borrower shall, within three Business Days of demand by a Lender, pay
to that Lender its Break Costs attributable to all or any part of the
Loan or an Unpaid Sum being paid by the Borrower on a day other than an
Interest Payment Date for the Loan or the due date for payment of an
Unpaid Sum.
(b) Each Lender shall, as soon as reasonably practicable after a demand by
the Administrative Agent or the Borrower, provide a certificate
confirming the amount of its Break Costs for any Interest Period in which
they accrue.
10 FEES
10.1 Commitment fee
The Borrower shall pay to the Administrative Agent (for the account of the
Lenders) a fee computed at the rate of 0,315 % per annum on any undrawn part of
the Commitment from time to time during the Availability Period, payable on the
last day of the Availability Period.
10.2 Other fees
The Borrower shall pay to the Mandated Lead Arrangers the other fees referred to
in the fee letters in the amounts and at the times specified therein for
distribution (if applicable) by the Administrative Agent in accordance with such
letters.
11 TAX GROSS UP AND INDEMNITIES
11.1 Tax gross-up
(a) The Borrower shall make all payments to be made by it without any Tax
deduction, unless a Tax deduction is required by law.
(b) The Borrower shall promptly upon becoming aware that it must make a Tax
deduction (or that there is any change in the rate or the basis of a Tax
deduction) notify the Administrative Agent accordingly. Similarly, a
Lender shall notify the Administrative Agent on becoming so aware in
respect of a payment payable to that Lender. If the Administrative Agent
receives such notification from a Lender it shall notify the Borrower.
(c) If a Tax deduction is required by law to be made by the Borrower, the
amount of the payment due from the Borrower shall be increased to an
amount which (after making any Tax deduction) leaves an amount equal to
the payment which would have been due if no Tax deduction had been
required.
(d) If the Borrower is required to make a Tax deduction, it shall make that
Tax deduction and any payment required in connection with that Tax
deduction within the time allowed and in the minimum amount required by
law.
(e) Within thirty days of making either a Tax deduction or any payment
required in connection with that Tax deduction, the Borrower shall
deliver to the Administrative Agent for the Lender entitled to the
payment evidence reasonably satisfactory to that Lender that the Tax
deduction has been made or (as applicable) any appropriate payment paid
to the relevant taxing authority.
11.2 Tax indemnity
(a) The Borrower shall (within three Business Days of demand by the
Administrative Agent) pay to a Finance Party an amount equal to the loss,
liability or cost which that Finance Party determines will be or has been
(directly or indirectly) suffered for or on account of Tax by that
Finance Party in respect of a Finance Document.
(b) Paragraph (a) above shall not apply:
(i) with respect to any Tax assessed on a Finance Party under the law
of the jurisdiction in which that Finance Party is incorporated
or, if different, the jurisdiction (or jurisdictions) in which
that Finance Party is treated as resident for tax purposes if that
Tax is imposed on or calculated by reference to the net income
received or receivable (but not any sum deemed to be received or
receivable) by that Finance Party; or
(ii) to the extent a loss, liability or cost is compensated for by an
increased payment under Clause 11.1 (Tax gross-up).
(c) A Finance Party making, or intending to make a claim under paragraph (a)
above shall promptly notify the Administrative Agent of the event which
will give, or has given, rise to the claim, following which the
Administrative Agent shall notify the Borrower.
(d) A Finance Party shall, on receiving a payment from the Borrower under
this Clause 11.2, notify the Administrative Agent.
11.3 Tax Credit
If the Borrower makes a Tax payment and the relevant Finance Party determines
that:
(a) a Tax credit is attributable either to an increased payment of which that
Tax payment forms part, or to that Tax payment; and
(b) that Finance Party has obtained, utilised and retained that Tax credit,
the Finance Party shall pay an amount to the Borrower which that Finance Party
determines will leave it (after that payment) in the same after-Tax position as
it would have been in had the Tax payment not been required to be made by the
Borrower.
11.4 Stamp taxes
The Borrower shall pay and, within three Business Days of demand, indemnify each
Finance Party against any cost, loss or liability that Finance Party incurs in
relation to all stamp duty, registration and other similar Taxes payable in
respect of any Finance Document.
11.5 Value added tax
(a) All consideration expressed to be payable under a Finance Document by the
Borrower to a Finance Party shall be deemed to be exclusive of any VAT.
If VAT is chargeable on any supply made by any Finance Party to the
Borrower in connection with a Finance Document, the Borrower shall pay to
the Finance Party (in addition to and at the same time as paying the
consideration) an amount equal to the amount of the VAT.
(b) Where a Finance Document requires the Borrower to reimburse a Finance
Party for any costs or expenses, the Borrower shall also at the same time
pay and indemnify the Finance Party against all VAT incurred by the
Finance Party in respect of the costs or expenses to the extent that the
Finance Party reasonably determines that it is not entitled to credit or
repayment of the VAT.
12 INCREASED COSTS
12.1 Increased costs
(a) The Borrower shall, within three Business Days of a demand by the
Administrative Agent, pay for the account of a Finance Party the amount
of any Increased Costs incurred by that Finance Party or any of its
affiliates as a result of (i) the introduction of or any change in (or in
the interpretation, administration or application of) any law or
regulation or (ii) compliance with any law or regulation made after the
date of this Agreement (including the implementation by the applicable
authorities of the matters set out in the statement of the Basle
Committee on Banking Regulations and Supervisory Practices).
(b) In this Agreement "Increased Costs" means:
(i) a reduction in the rate of return from the Loan or on a Finance
Party's (or its affiliate's) overall capital;
(ii) an additional or increased cost; or
(iii) a reduction of any amount due and payable under any Finance
Document, which is incurred or suffered by a Finance Party or any
of its affiliates to the extent that it is attributable to that
Finance Party having entered into its Commitment or funding or
performing its obligations under any Finance Document.
12.2 Increased cost claims
(a) A Finance Party intending to make a claim pursuant to Clause 12
(Increased costs) shall notify the Administrative Agent of the event
giving rise to the claim, following which the Administrative Agent shall
promptly notify the Borrower.
(b) Each Finance Party shall, as soon as practicable after a demand by the
Administrative Agent or the Borrower, provide a certificate confirming
the amount of its Increased Costs.
13 OTHER INDEMNITIES
13.1 Currency indemnity
(a) If any sum due from the Borrower under the Finance Documents (a "Sum"),
or any order, judgment or award given or made in relation to a Sum, has
to be converted from the currency (the "First Currency") in which that
Sum is payable into another currency (the "Second Currency") for the
purpose of:
(i) making or filing a claim or proof against the Borrower; or
(ii) obtaining or enforcing an order, judgement or award in relation to
any litigation or arbitration proceedings.
(b) the Borrower shall as an independent obligation, within three Business
Days of demand, indemnify each Finance Party to whom that Sum is due
against any cost, loss or liability arising out of or as a result of the
conversion including any discrepancy between (A) the rate of exchange
used to convert that Sum from the First Currency into the Second Currency
and (B) the rate or rates of exchange available to that person at the
time of its receipt of that Sum.
(c) the Borrower waives any right it may have in any jurisdiction to pay any
amount under the Finance Documents in a currency or currency unit other
than that in which it is expressed to be payable.
13.2 Other indemnities
The Borrower shall within three Business Days of demand from the Administrative
Agent, indemnify each Finance Party against any direct cost, loss or liability
incurred by that Finance Party as a result of:
(a) a Default; or
(b) the Loan (or part of the Loan) not being prepaid in accordance with a
notice of prepayment given by the Borrower.
13.3 Indemnity to the Administrative Agent
The Borrower shall promptly indemnify the Administrative Agent against any cost,
loss or liability incurred by the Administrative Agent (acting reasonably) as a
result of:
(a) investigating any event which it reasonably believes may be an Event of
Non-compliance; or
(b) acting or relying on any notice, request or instruction which it
reasonably believes to be genuine, correct and appropriately authorised.
14 COSTS AND EXPENSES
14.1 Transaction expenses
The Borrower shall promptly on demand pay the Administrative Agent whether or
not the Commitment is drawn the amount of all costs and expenses (including
legal fees and any VAT payable thereon) reasonably incurred by it in connection
with the negotiation, preparation, printing and execution of:
(a) this Agreement and any other documents referred to in this Agreement; and
(b) any other Finance Documents executed after the date of this Agreement.
14.2 Amendment costs
If the Borrower requests an amendment, waiver or consent, the Borrower shall,
within three Business Days of demand, reimburse the Administrative Agent for the
amount of all costs and expenses (including legal fees and any VAT payable
thereon) reasonably incurred by the Administrative Agent in responding to,
evaluating, negotiating or complying with that request.
14.3 Enforcement costs
The Borrower shall, within three Business Days of demand, pay to each Finance
Party the amount of all costs and expenses (including legal fees and any VAT
payable thereon) incurred by that Finance Party in connection with the
enforcement of, or the preservation of any rights under, any Finance Document.
15 SECURITY
15.1 Security Documents
So long as any amount is owing to the Lenders, any Hedge Counterparty, the
Security Agent and the Administrative Agent under the Finance Documents and
unless otherwise provided herein, the Loan and any other obligation and
liability that any Obligor has or may incur towards the Finance Parties under
the Finance Documents shall be secured by the Security Documents as set out in
Schedule 9 (Security Documents)
15.2 Priority
(a) All the Security Documents shall create security on first and sole
priority over the assets specified therein.
(b) In case of conflict between the provisions of this Agreement and the
provisions of the Security Documents, the terms and conditions of this
Agreement shall prevail.
15.3 Security agent
The Security Agent shall act as security agent and receive, hold, administer and
enforce the Security Documents on behalf of and for the benefit of the Lenders.
15.4 Set-off
Following the occurrence of a Default, each of the Security Agent, the
Administrative Agent and the Lenders shall, to the extent permitted by
applicable law and always subject to Clause 26.1 (Payment to Finance Parties),
have a separate right of set-off in respect of any credit balance, in any
currency, on any account that the Borrower might have with the Administrative
Agent and the Lenders (branches included) against any matured obligations due
from the Borrower to the Security Agent, the Administrative Agent and the
Lenders under the Finance Documents.
16 REPRESENTATIONS
Each Obligor makes the representations and warranties set out in this Clause 16
to each Finance Party on the date of this Agreement.
16.1 Status
(a) It is a corporation, duly incorporated and validly existing under the
laws of its jurisdiction of incorporation.
(b) It has the power to own its assets and carry on its business as it is
being conducted.
16.2 Binding obligations
The obligations expressed to be assumed by it in each Finance Document and
Transaction Document are legal, valid, binding and enforceable obligations.
16.3 Non-conflict with other obligations
The entry into and performance by it of, and the transactions contemplated by,
the Finance Documents do not and will not conflict with:
(a) any law or regulation applicable to it;
(b) its constitutional documents; or
(c) any agreement or instrument binding upon it or any of its assets.
16.4 Power and authority
It has the power to enter into, perform and deliver, and has taken all necessary
action to authorise its entry into, performance and delivery of, the Finance
Documents to which it is a party and the transactions contemplated by those
Finance Documents.
16.5 Validity and admissibility in evidence
All authorisations required or desirable:
(a) to enable it lawfully to enter into, exercise its rights and comply with
its obligations in the Finance Documents to which it is a party; and
(b) to make the Finance Documents to which it is a party admissible in
evidence in its jurisdiction of incorporation,
have been obtained or effected and are in full force and effect.
16.6 Governing law and enforcement
(a) The choice of Norwegian law as the governing law of the Finance Documents
(other than the Mortgages not registered with Norwegian International
Shipregister, the Borrower General Assignment and the Owners' Contract
Assignment) will be recognised and enforced in its jurisdiction of
incorporation.
(b) Any judgment obtained in Norway in relation to a Finance Document will be
recognised and enforced in its jurisdiction of incorporation.
16.7 Deduction of Tax
It is not required under the law of its jurisdiction of incorporation to make
any deduction for or on account of Tax from any payment it may make under any
Finance Document.
16.8 No filing or stamp taxes
Under the law of its jurisdiction of incorporation it is not necessary that the
Finance Documents (other than the Mortgages) be filed, recorded or enrolled with
any court or other authority in that jurisdiction or that any stamp,
registration or similar tax be paid on or in relation to the Finance Documents
or the transactions contemplated by the Finance Documents.
16.9 No default or non-compliance
(a) No Event of Non-compliance exists or may reasonably be expected to occur
as a consequence of the advance of the Loan to the Borrower;
(b) No event of default has occurred or is continuing under the Senior Note
Documents; and
(c) No other event or circumstance is outstanding which constitutes a default
under any other agreement or instrument which is binding on it or to
which its assets are subject which might have a Material Adverse Effect.
16.10 No misleading information
In the case of the Borrower:
(a) Any factual information provided by the Borrower to any of the Finance
Parties were true and accurate in all material respects as at the date it
was provided or as at the date (if any) at which it is stated.
(b) The financial projections provided by the Borrower to any of the Finance
Parties have been prepared on the basis of recent historical information
and on the basis of reasonable assumptions.
(c) Nothing has occurred and no information has been given or withheld that
results in the information provided by the Borrower to any of the Finance
Parties being untrue or misleading in any material respect.
16.11 Financial statements
In the case of the Borrower:
(a) Its Original Financial Statements were prepared in accordance with GAAP
consistently applied.
(b) Its Original Financial Statements represent its financial condition and
operations during the relevant period.
(c) There has been no material adverse change in its business or financial
condition since 30 September 2004.
16.12 Pari passu ranking
Its payment obligations under the Finance Documents rank at least pari passu
with the claims of all its other unsecured and unsubordinated creditors, except
for obligations mandatorily preferred by law applying to companies and vessels
generally.
16.13 No proceedings pending or threatened
No litigation, arbitration or administrative proceedings of or before any court,
arbitral body or agency which, if adversely determined, might reasonably be
expected to have a Material Adverse Effect have (to the best of its knowledge
and belief) been started or threatened against it.
16.14 Indebtedness/encumbrances
Save as permitted under this Agreement and any Senior Note Documents, no Owner
has any indebtedness or created any encumbrances over all or any of its assets.
16.15 Ownership
Each Owner is a wholly owned subsidiary of the Borrower, and each Owner is the
legal and beneficial owner of the relevant Vessel as listed in Schedule 1.
16.16 Repetition
The representations are deemed to be repeated by each Obligor by reference to
the facts and circumstances then existing on the first day of each Interest
Period.
17 INFORMATION UNDERTAKINGS
The undertakings in this Clause 17 remain in force from the date of this
Agreement for so long as the Commitment is in force or any amount is outstanding
under the Finance Documents.
17.1 Financial statements
The Borrower shall supply to the Administrative Agent:
(a) as soon as the same become available, but in any event within 180 days
after the end of each financial year, its audited financial statements
for that financial year; and
(b) as soon as the same become available, but in any event within 60 days
after the end of each financial quarter its unaudited quarterly financial
statements; and
(c) such other financial and other information of any Obligor as the Lenders
shall reasonably require from time to time.
17.2 Compliance Certificate
(a) The Borrower shall supply to the Administrative Agent with each set of
financial statements delivered pursuant to Clause 17.1 (Financial
statements) a Compliance Certificate substantially in the form set out in
Schedule 7 setting out (in reasonable detail) computations as to
compliance with Clause 18 (Financial covenants) as at the date as at
which those financial statements were drawn up.
(b) Each Compliance Certificate shall be signed by a director of the
Borrower.
17.3 Requirements as to financial statements
(a) Each set of financial statements delivered by the Borrower pursuant to
Clause 17.1 (Financial statements) shall be certified by a director of
the Borrower as representing its financial condition as at the date as at
which those financial statements were drawn up.
(b) The Borrower shall procure that each set of financial statements
delivered pursuant to Clause 17.1 (Financial statements) is prepared
using GAAP or such other generally accepted accounting principles
acceptable to the Administrative Agent.
17.4 Information: miscellaneous
The Borrower shall supply to the Administrative Agent:
(a) all documents dispatched by it to its shareholders or its creditors
generally at the same time as they are dispatched;
(b) promptly upon becoming aware of it, the details of any litigation,
arbitration or administrative proceedings which are current, threatened
or pending, and which might, if adversely determined, have a Material
Adverse Effect; and
(c) promptly, such further information regarding its, the Charterers or any
of the Owners' financial condition, business and operations as the
Administrative Agent may reasonably request.
17.5 Notification of non-compliance
(a) The Borrower shall notify the Administrative Agent of an Event of
Non-compliance (and the steps, if any, being taken to remedy it) promptly
upon becoming aware of its occurrence.
(b) Promptly upon a request by the Administrative Agent, the Borrower shall
supply to the Administrative Agent a certificate signed by two of its
directors certifying that no Event of Non-compliance is continuing (or if
an Event of Non-compliance is continuing, specifying the Event of
Non-compliance and the steps, if any, being taken to remedy it).
18 FINANCIAL COVENANTS
The undertakings in this Clause 18 remain in force from the date of this
Agreement for so long as the Commitment is in force or any amount is outstanding
under the Finance Documents.
18.1 Minimum Value
If at any time the aggregate of the Ship's Value of the Vessels shall fall below
140 % of the Loan, the Borrower shall either (i) prepay the amount of the Loan
necessary to restore such ratio or (ii) provide additional security for the Loan
which in the reasonable opinion of all Lenders is deemed satisfactory for
restoring such ratio.
18.2 Free Cash
The Borrower shall on a consolidated basis at any time maintain Free Cash of a
minimum of USD 25,000,000.
18.3 Working capital
The Borrower shall on a consolidated basis at any time maintain a positive
Working Capital.
For the purpose of this Clause "Working Capital" means Current Assets less
Current Liabilities and "Current Assets" means at any time, in accordance with
GAAP, the consolidated book value of the current assets of such Borrower and
"Current Liabilities" means at any time, in accordance with GAAP, the
consolidated book value of the current liabilities excluding the short term
portion of the long term debt of such Borrower.
18.4 Minimum Equity Ratio
The Minimum Equity Ratio of the Borrower on a consolidated basis on the last day
of each financial quarter shall be at least 20%.
For the purpose of this Clause "Minimum Equity Ratio" means the ratio (expressed
as a percentage) of Shareholder Equity to Total Assets and "Shareholder Equity"
means Total Assets less Total Liabilities and "Total Assets" means at any time,
in accordance with GAAP, the consolidated book value of all assets (both
tangible and intangible) owned by the Borrower at the relevant time and "Total
Liabilities" means at any time, the consolidated book value of long term and
short term debt and other liabilities which in accordance with GAAP shall be
included in a balance sheet.
19 VESSEL UNDERTAKINGS
The undertakings in this Clause 19 remain in force from the date of this
Agreement for so long as the Commitment is in force or any amount is outstanding
under the Finance Documents.
19.1 Registration and ownership
Each Owner shall (and the Borrower shall procure that each Owner will) remain
the sole owner of its Vessel and shall keep its Vessel registered in a ship
register acceptable to the Majority Lenders provided, however, that an Owner
shall have the right to sell its Vessel upon the Borrower giving the
Administrative Agent not less than ten (10) calendar days irrevocable written
notice prior to the transfer of such Vessel.
19.2 Flag
Each Owner shall (and the Borrower shall procure that each Owner will) maintain
its Vessel with a flag acceptable to the Majority Lenders.
19.3 Classification
Each Owner shall (and the Borrower shall procure that each Owner will) maintain
the classification of its Vessel with first class classification societies
acceptable to the Majority Lenders free of overdue recommendations and shall
allow the Administrative Agent or its representatives to inspect the original
class and related records of such Vessel with such classification society and to
take copies of them.
19.4 Laws and safety management
Each Owner shall (and the Borrower shall procure that each Owner will) maintain
its Vessel and its management in compliance from time to time with:
(a) Environmental Laws;
(b) the ISM Code;
(c) the ISPS Code;
(d) laws, regulations and requirements of the flag state
and to obtain and comply with all applicable Environmental Approvals, and upon
any Obligor or its manager becoming aware thereof, it shall promptly notify the
Administrative Agent in writing of any breach or alleged breach of any of the
above laws, approvals or regulations.
19.5 Management Agreement
The management agreement of each Vessel shall be with the Manager or with
managers approved by the Majority Lenders, and the Manager shall be in
possession of a DOC and shall at all times be acceptable to the Majority Lenders
and each Owner shall (and the Borrower shall procure that each Owner will) not
make or agree to any material change to the Management Agreement without the
prior written consent of the Administrative Agent on behalf of the Majority
Lenders which shall not be unreasonably withheld.
19.6 Technical condition
Each Owner shall (and the Borrower shall procure that each Owner will) maintain
its Vessel in a technical condition consistent with first class ship ownership
and management practice, and it shall arrange to have its Vessel submitted for
technical inspection in form and substance satisfactory to the Majority Lenders
by an independent surveyor appointed by the Administrative Agent and the
Borrower shall reimburse the costs thereof limited however to one inspection per
year. In the event such inspection does not conclude with a report satisfactory
to the Majority Lenders, the Borrower shall procure that the technical condition
of such Vessel is rectified and re-submit such Vessel for technical inspections
in the same manner within three months and at their own expense.
19.7 Major structural alteration
No Owner shall (and the Borrower shall procure that no Owner will) without the
prior written consent of the Administrative Agent on behalf of the Majority
Lenders permit any major structural alteration or any other major change to be
made to its Vessel or undertake, contract or otherwise make any investment in
respect of its Vessel in excess of USD 1,000,000 per annum unless such
investment is necessary to maintain such Vessel's class.
19.8 Insurances
(a) Each Owner shall (and the Borrower shall procure that each Owner will)
keep its Vessel insured for risks and at values as may at any time be
reasonably required by the Administrative Agent on behalf of the Majority
Lenders with first class underwriters and at terms acceptable to the
Administrative Agent and register and maintain the registration of the
Administrative Agent as mortgagee (on behalf of the Lenders) with first
priority in all insurance policies and certificates of entry.
(b) The insurances shall include:
(i) Hull and Machinery,
(ii) Hull Interest and Freight Interest,
(iii) War Risks,
(iv) Protection and Indemnity,
(v) MAP (Additional Perils) Pollution
(c) The insured value for Hull and Machinery shall cover at least 80% of the
Ship's Value of each Vessel, (ii) the insured value for Hull and
Machinery as combined with Hull Interest and Freight Interest and for War
Risks shall always cover at least the Ship's Value of each Vessel and
(iii) the aggregate insured value for Hull and Machinery as combined with
Hull Interest and Freight Interest and for War Risks for all Vessels
shall cover at least 110 % of the Loan.
(d) Each Owner shall (and the Borrower shall procure that each Owner will)
punctually pay all insurance premiums and calls in respect of its Vessel,
timely renew the insurances and deliver to the Administrative Agent
copies of cover notes and certificates of entry evidencing that such
Vessel is insured and that the Administrative Agent is noted as mortgagee
in the Vessel's insurance policies with first priority.
(e) Each Owner shall (and the Borrower shall procure that each Owner will)
timely submit US Voyage Declarations in accordance with the P&I terms of
cover and obtain a Certificate of Financial Responsibility (COFR) before
its Vessel is trading to the United States.
(f) In the event the Administrative Agent after consultation with the
Borrower has obtained MAP (Additional Perils) Pollution to secure the
interest of the Finance Parties in the Vessels, the Borrower shall
reimburse the Administrative Agent in full all the costs incurred by the
Administrative Agent in this connection.
19.9 Accident, Total Loss or arrest
Each Owner shall (and the Borrower shall procure that each Owner will) promptly
notify the Administrative Agent in writing (in case of urgency by telefax) of:
(i) any accident to its Vessel involving repairs where the cost is
likely to exceed USD 1,000,000 (or the equivalent in any other
currency);
(ii) any occurrence in consequence whereof its Vessel has become or is
likely to become a total loss ("Total Loss") which expression
shall include the actual, constructive or compromised total loss
of such Vessel; and
(iii) any arrest of its Vessel or the exercise or purported exercise of
any lien on such Vessel.
19.10 Release of distress
Each Owner shall (and the Borrower shall procure that each Owner will) promptly
notify the Administrative Agent in writing of any distress or other similar
charges against its Vessel that it or its manager should become aware of and if
required by the Majority Lenders, it shall procure that any distress or other
similar charges against its Vessel shall be released.
19.11 Encumbrances
No Owner shall (and the Borrower shall procure that no Owner will) register or
grant or permit any mortgage or other encumbrance over its Vessel other than the
Mortgages or any lien arising by operation of law or in the ordinary course of
trading of its Vessel without the prior written consent of the Administrative
Agent on behalf of the Majority Lenders.
19.12 Commercial management
The commercial management agreement of the Vessels shall be with the Manager or
such other manager as approved by the Administrative Agent on behalf of the
Majority Lenders and no Owner shall (and the Borrower shall procure that no
Owner will) make or agree to any material change thereto without the prior
written consent of the Administrative Agent on behalf of the Majority Lenders
which shall not be unreasonably withheld.
19.13 Valuation
Each Owner shall (and the Borrower shall procure that each Owner shall) at any
time required by the Majority Lenders arrange to have its Vessel valued at the
Borrower's expense, but then limited to four times per year, by three
independent and reputable ship broking firms approved by the Administrative
Agent, such valuations to set the considered market value of a Vessel free of
charter, the average of said three valuations being referred to in this
Agreement as the "Ship's Value".
20 CORPORATE UNDERTAKINGS
The undertakings in this Clause 20 remain in force from the date of this
Agreement for so long as the Commitment is in force or any amount is outstanding
under the Finance Documents.
20.1 No change of status
No Obligor shall make any changes to its constitutive documents or merge,
de-merge, consolidate or liquidate or in any other way make any amendments to
its corporate status without the prior written consent of the Administrative
Agent on behalf of the Majority Lenders.
20.2 No change of control
If at any time more than fifty per cent (50%) of the issued voting share capital
of the Borrower or the right to control or direct the majority of the board of
directors of the Borrower becomes held by one person or one company (or two or
more persons/companies acting in concert) (a "Change of Control Event") the
Borrower shall immediately upon becoming aware thereof give notice to the
Administrative Agent. Unless the Administrative Agent (on behalf of the Majority
Lenders) consent to the change of control, the Administrative Agent and the
Borrower shall enter into negotiations for a period of not more than thirty days
(counted from the date when the Borrower became aware of the Change of Control
Event) with a view to agreeing any amendments or agreements in light of the
consequences of the Change of Control Event. If the negotiation fails to reach
an agreed outcome within the thirty days, the Administrative Agent may
thereafter give notice to the Borrower requiring the Borrower to prepay the Loan
and other amounts outstanding under the Finance Documents within 90 days and
cancel the Commitment.
20.3 Listing
The Borrower shall remain listed at the New York Stock Exchange.
20.4 No change of ownership
The Borrower shall ensure that each Owner is a wholly-owned subsidiary of it and
the Borrower shall not make (and no Owner shall permit) any disposal of its
ownership and control without the prior written consent of the Administrative
Agent on behalf of the Majority Lenders.
20.5 Scope of business
No Owner shall engage in any other business than that immediately related to the
owning of the Vessels and the Borrower shall not engage in other business than
what is connected with the owning of tanker vessels.
20.6 No further borrowing
No Owner shall make any further borrowing, enter into any guarantee liability
and have any other indebtedness than the shareholders' loans (which shall be
fully subordinated to the rights of the Finance Parties under this Agreement)
its obligations under the Senior Note Documents and trade debt following the
ordinary operation of its Vessel without the prior written consent of the
Administrative Agent on behalf of the Majority Lenders.
20.7 No further investments
No Owner shall commit to any further investments or activities other than those
related to the ownership and the regular operation of its Vessels and the
Borrower shall not commit to any investments or activities other than those
related to the nature of its business without the prior written consent of the
Administrative Agent on behalf of the Majority Lenders.
20.8 No distribution
The Borrower shall not distribute any profit to, make any dividend payment to,
repay or make any payment of interest on any loans from, or make any other
distribution of any asset to its shareholders unless the aggregate of a) Free
Cash and b) the Charter Service Reserve Deposit immediately after such
distribution will be minimum USD 100,000,000 and no Event of Non-compliance has
occurred or is continuing.
20.9 Earnings accounts
The Borrower shall keep its Earnings Account with the Administrative
Agent.
20.10 Authorisations
Each Obligor shall promptly:
(a) obtain, comply with and do all that is necessary to maintain in full
force and effect; and
(b) supply certified copies to the Administrative Agent of,
any authorisation required under any law or regulation of its jurisdiction of
incorporation to enable it to perform its obligations under the Finance
Documents and to ensure the legality, validity, enforceability or admissibility
in evidence in its jurisdiction of incorporation of any Finance Document.
20.11 Compliance with laws
Each Obligor shall comply in all respects with all laws to which it may be
subject, if failure so to comply would materially impair its ability to perform
its obligations under the Finance Documents.
20.12 Interest Hedging Agreements
The Borrower shall not make any amendments to or terminate the Interest Hedging
Agreements without the prior written consent of the Administrative Agent on
behalf of the Majority Lenders which shall not be unreasonably withheld, and it
shall fulfil all its obligations under the Interest Hedging Agreements.
20.13 Money laundering
The Borrower shall be acting for its own account in relation to the borrowing of
the Loan, the performance and discharge of its obligations and liabilities under
the Finance Documents and the transactions and other arrangements effected or
contemplated by the Finance Documents to which it is a party and the foregoing
shall not involve or lead to a contravention of any law, official requirement or
other regulatory measure or procedure which has been implemented to combat
"money laundering" (as defined in Article 1 of the Directive (91/308/EEC) of the
council of the European Communities).
20.14 Transaction Documents
No Obligor shall (and the Borrower shall procure that neither the Charterer,
Frontline Ltd. or other related companies will) make or agree to any changes to
the Transaction Documents without the prior written consent of the
Administrative Agent on behalf of the Majority Lenders which shall not be
unreasonably withheld.
21 EVENTS OF NON-COMPLIANCE AND DEFAULT
21.1 Event of Non-compliance
Each of the events or circumstances set out in Clauses (a) to (h) below is an
Event of Non-compliance:
(a) Non-payment
The Borrower does not pay on the due date any amount payable pursuant to
a Finance Document at the place at and in the currency in which it is
expressed to be payable unless:
(i) its failure to pay is caused by administrative or technical error;
and
(ii) payment is received by the Administrative Agent within 5 Business
Days of its due date.
(b) Non-compliance
Either the Borrower or any of the Owners does not comply in any material
respect in its due performance or observance of any undertaking, covenant
or other obligation or term contained in any of the Finance Documents
other than as set forth in Clause 21.1 (a) (Non payment) and such
non-compliance is not remedied (if, in the opinion of the Administrative
Agent (acting on the instructions of the Majority Lenders) such
non-compliance is capable of remedy) within 14 days from receipt by the
Borrower of a request for remedy from the Administrative Agent always
provided that no period of remedy will be accorded in respect of any
non-compliance by the Borrower in relation to its obligations under
Clauses 19.1 (Registration and ownership), 19.2 (Flag), 19.3
(Classification) and 19.8 (Insurances).
(c) Misrepresentation
Any representation or statement made or repeated in or in connection with
the Finance Documents or any other document delivered by or on behalf of
the Borrower or any of the Owners under or in connection with any Finance
Document is or proves to have been incorrect or misleading in any
material respect when made or deemed to be made.
(d) Cross default
(i) Any Financial Indebtedness above USD 10,000,000 in the case of the
Borrower or above USD 3,000,000 in the case of an Owner is not
paid when due nor within any originally applicable grace period.
(ii) For the purpose of this Clause, "Financial Indebtedness" means any
indebtedness for or in respect of:
1. moneys borrowed;
2. any amount raised by acceptance under any acceptance credit
facility;
3. any amount raised pursuant to any note purchase facility or
the issue of bonds, notes, debentures, loan stock or any
similar instrument;
4. the amount of any liability in respect of any lease or hire
purchase contract which would, in accordance with GAAP, be
treated as a finance or capital lease;
5. receivables sold or discounted (other than any receivables
to the extent they are sold on a non-recourse basis);
6. any amount raised under any other transaction (including
any forward sale or purchase agreement) having the
commercial effect of a borrowing;
7. any derivative transaction entered into in connection with
protection against or benefit from fluctuation in any rate
or price (and, when calculating the value of any derivative
transaction, only the marked to market value shall be taken
into account);
8. any counter-indemnity obligation in respect of a guarantee,
indemnity, bond, standby or documentary letter of credit or
any other instrument issued by a bank or financial
institution; and
9. the amount of any liability in respect of any guarantee or
indemnity for any of the items referred to in paragraphs
(1) to (8) above.
(e) Insolvency
(i) The Borrower or any of the Owners is unable or admits inability to
pay its debts as they fall due, suspends making payments on any of
its debts.
(ii) The value of the assets of the Borrower is less than its
liabilities (taking into account contingent and prospective
liabilities).
(iii) A moratorium is declared in respect of any indebtedness of the
Borrower or any Owner.
(iv) Any insolvency proceedings or any analogous procedure is initiated
against the Borrower or any Owner.
(f) Unlawfulness
It is or becomes unlawful for the Borrower or any of the Owners to
perform any of its obligations under the Finance Documents.
(g) Senior Note Default
Any Senior Note Default is declared and is continuing.
(h) Event of default under a Transaction Document
There is an event of default under any Transaction Document and, save for
the failure of the Charterer at any time to hold at least USD 55,000,000
in cash or cash equivalents (as defined in the Charter Ancillary
Agreement), in the reasonable opinion of the Majority Lenders, such
default will adversely affect the Borrower's or the Owners' ability to
fulfil its obligations under the Finance Documents.
(i) Material adverse change
The Borrower, the Charterer or any of the Owners shall suffer a material
adverse change in its financial position or its operation which in the
reasonable opinion of the Majority Lenders will adversely affect the
Borrower's or the Owners' ability to fulfil its obligations under the
Finance Documents.
21.2 Default
At any time following the occurrence of an Event of Non-compliance and while it
is continuing, the Administrative Agent may and if so directed by the Majority
Lenders, shall by notice to the Borrower declare that a Default has occurred.
21.3 Acceleration
The Administrative Agent may and if so directed by the Majority Lenders, shall,
either in the notice of default or at any time subsequent thereto while the
circumstances having given rise to such Default continues:
(a) cancel the Commitment; and/or
(b) declare that all amounts outstanding from the Borrower to the Finance
Parties hereunder at such time shall be immediately due and payable,
whereafter the Borrower shall be obliged to pay the same.
21.4 Remedy
The Administrative Agent (acting under the instructions of the Majority Lenders)
shall, if the circumstances having given rise to a Default have been remedied
and the Borrower otherwise is in compliance with its obligations hereunder,
notify the Borrower that the Default no longer exists.
22 GUARANTEE
22.1 Guarantee and indemnity
Each Owner hereby unconditionally and irrevocably:
(a) guarantees, jointly and severally, to the Security Agent, the Hedge
Counterparties, the Administrative Agent and the Lenders punctual
performance by each Obligor of its obligations under the Finance
Documents;
(b) undertakes, jointly and severally, with the Security Agent, the
Administrative Agent and the Lenders that whenever any Obligor does not
pay any amount when due under or in connection with any Finance Document,
any Owner shall immediately on demand pay that amount as if it was the
principal obligor; and
(c) indemnifies, jointly and severally, each Finance Party immediately on
demand against any cost, loss or liability suffered by that Finance Party
if any obligation guaranteed by it is or becomes unenforceable, invalid
or illegal. The amount of the cost, loss or liability shall be equal to
the amount which that Finance Party would otherwise have been entitled to
recover.
For the purpose of fulfilling the requirements of the Financial Contracts Act
ss. 61, each Owners maximum liability secured by this Guarantee is USD
1,131,439,219. Each Owner is in addition liable for interest and costs in
accordance with this Agreement.
22.2 Continuing guarantee
This Guarantee is a continuing guarantee and shall extend to the ultimate
balance of sums payable by any Obligor under the Finance Documents, regardless
of any intermediate payment or discharge in whole or in part.
22.3 Reinstatement
If any payment by an Obligor or any discharge given by a Finance Party (whether
in respect of the obligations of any Obligor or any security for those
obligations or otherwise) is avoided or reduced as a result of insolvency or any
similar event:
(a) the liability of each Obligor shall continue as if the payment,
discharge, avoidance or reduction had not occurred; and
(b) each Finance Party shall be entitled to recover the value or amount of
that security or payment from each Obligor, as if the payment, discharge,
avoidance or reduction had not occurred.
22.4 Waiver of defences
The obligations of any of the Owners shall not be affected by an act, omission,
matter or thing which would reduce, release or prejudice any of its obligations
(without limitation and whether or not known to it or any Finance Party)
including:
(a) any time, waiver or consent granted to, or composition with, any Obligor
or other person;
(b) the release of any other Obligor or any other person under the terms of
any composition or arrangement with any creditor of any Obligor;
(c) the taking, variation, compromise, exchange, renewal or release of, or
refusal or neglect to perfect, take up or enforce, any rights against, or
security over assets of, any Obligor or other person or any
non-presentation or non-observance of any formality or other requirement
in respect of any instrument or any failure to realise the full value of
any security;
(d) any incapacity or lack of power, authority or legal personality of or
dissolution or change in the members or status of an Obligor or any other
person;
(e) any amendment (however fundamental) or replacement of a Finance Document
or any other document or security; (f) any unenforceability, illegality
or invalidity of any obligation of any person under any Finance Document
or any other document or security;
(g) any insolvency or similar proceedings; or
(h) the provisions of sections 62 (1), 63, 65, 66, 67, 70, 71, 72, 73 and 74
of the Norwegian Financial Contracts Act.
22.5 Immediate recourse
Each Owner waives any right it may have of first requiring any Finance Party (or
any trustee or agent on its behalf) to proceed against or enforce any other
rights or security or claim payment from any person before claiming from any of
the Owners. This waiver applies irrespective of any law or any provision of a
Finance Document to the contrary.
22.6 Appropriations
Until all amounts which may be or become payable by the Obligors under or in
connection with the Finance Documents have been irrevocably paid in full, each
Finance Party (or any trustee or agent on its behalf) may:
(a) refrain from applying or enforcing any other moneys, security or rights
held or received by that Finance Party (or any trustee or agent on its
behalf) in respect of those amounts, or apply and enforce the same in
such manner and order as it sees fit (whether against those amounts or
otherwise) and none of the Owners shall be entitled to the benefit of the
same; and
(b) hold in an interest-bearing suspense account any moneys received from any
Owner or on account of the Owner's liability under this Guarantee.
22.7 Deferral of Owners' rights
Until all amounts which may be or become payable by the Obligors under or in
connection with the Finance Documents have been irrevocably paid in full and
unless the Administrative Agent otherwise directs, no Owner shall exercise any
rights which it may have by reason of performance by it of its obligations under
the Finance Documents:
(a) to be indemnified by the Borrower;
(b) to claim any contribution from any Obligor under the Finance Documents;
and/or
(c) to take the benefit (in whole or in part and whether by way of
subrogation or otherwise) of any rights of the Finance Parties under the
Finance Documents or of any other guarantee or security taken pursuant
to, or in connection with, the Finance Documents by any Finance Party.
22.8 Additional security
This Guarantee is in addition to and is not in any way prejudiced by any other
guarantee or security now or subsequently held by any Finance Party.
22.9 Owner's right of contribution
Subject to Clause 22.7 (Deferral of Owners' rights), at any time a
payment is made under the Guarantee each such Guarantor shall have a
right of contribution against each other Guarantor who has made no
payment or has made payments in respect of the Guarantee.
22.10 No Fraudulent Conveyance
The Borrower, each Owner and each Lender (by its signature hereto and the
Security Agent's acceptance on its behalf of the benefits of the relevant
Mortgage) hereby confirms that it is its intention that the provisions of the
Guarantee and each Mortgage not constitute a fraudulent transfer or conveyance
for purposes of the Bankruptcy Code, the Uniform Fraudulent Conveyance Act or
any similar United States Federal or state law or similar law of any other
jurisdiction. To effectuate the foregoing intention, the Borrower, each Owner
and each Lender (by its signature hereto and the Security Agent's acceptance of
the benefits of the relevant Mortgage) hereby irrevocably agrees that the
obligations secured under the Security Documents by each Owner shall be limited
to such amount as will, after giving effect to such maximum amount and all other
(contingent or otherwise) liabilities of such Owner that are relevant under such
laws and after giving effect to any rights to contribution pursuant to any
agreement providing for an equitable contribution among such Owner and the other
Owners, result in the obligations secured under the Security Documents of such
Owner in respect of such maximum amount not constituting a fraudulent transfer
or conveyance.
23 CHANGES TO THE LENDERS
23.1 Transfers by the Lenders
Subject to this Clause 23, a Lender (the "Existing Lender") may transfer any of
its rights and obligations under the Finance Documents to another bank or
financial institution (the "New Lender").
23.2 Conditions of transfer
(a) The consent of the Borrower is required for transfer by a Lender, unless
the transfer is to another Lender or an affiliate of a Lender.
(b) The consent of the Borrower to a transfer must not be unreasonably
withheld or delayed. The Borrower shall be deemed to have given its
consent five Business Days after that Lender has requested it unless
consent is expressly refused by the Borrower within that time.
(c) An assignment shall only be effective on receipt by the Administrative
Agent of written confirmation from the New Lender (in form and substance
satisfactory to the Administrative Agent) that the New Lender shall
assume the same obligations to the other Finance Parties as it would have
been under if it was an Existing Lender.
(d) A transfer shall only be effective if the procedure set out in Clause
23.4 (Procedure for transfer) is complied with.
23.3 Limitation of responsibility of Existing Lenders
(a) Unless expressly agreed to the contrary, an Existing Lender makes no
representation or warranty and assumes no responsibility to a New Lender
for:
(i) the legality, validity, effectiveness, adequacy or enforceability
of the Finance Documents or any other documents;
(ii) the financial conditions of the Obligors;
(iii) the performance and observance by any Obligors of its obligations
under the Finance Documents or any other documents; or
(iv) the accuracy of any statements (whether written or oral) made in
or in connection with any Finance Document or any other document,
(v) and any representations or warranties implied by law are excluded.
(b) Each New Lender confirms to the Existing Lender and the other Finance
Parties that it:
(i) has made (and shall continue to make) its own independent
investigation and assessment of the financial condition and
affairs of the Borrower and the Owners and their related entities
in connection with its participation in this Agreement and has not
relied exclusively on any information provided to it by the
Existing Lender in connection with any Finance Document; and
(ii) will continue to make its own independent appraisal of the
creditworthiness of the Borrower and the Owners and their related
entities whilst any amount is or may be outstanding under the
Finance Documents.
(c) Nothing in any Finance Document obliges an Existing Lender to:
(i) accept a re-transfer from a New Lender of any of the rights and
obligations assigned or transferred under this Clause 23; or
(ii) support any losses directly or indirectly incurred by the New
Lender by reason of the non-performance by the Borrower of its
obligations under the Finance Documents or otherwise.
23.4 Procedure for transfer
(a) Subject to the conditions set out in Clause 23.2 (Conditions of transfer)
a transfer is effected in accordance with paragraph (b) below when the
Administrative Agent executes an otherwise duly completed Transfer
Certificate delivered to it by the Existing Lender and the New Lender.
The Administrative Agent shall, as soon as reasonably practicable after
receipt by it of a duly completed Transfer Certificate appearing on its
face to comply with the terms of this Agreement and delivered in
accordance with the terms of this Agreement, execute that Transfer
Certificate.
(b) On the Transfer Date:
(i) to the extent that in the Transfer Certificate the Existing Lender
seeks to transfer its rights and obligations under the Finance
Documents the Borrower and the Existing Lender shall be released
from further obligations towards one another under the Finance
Documents and their respective rights against one another under
the Finance Documents shall be cancelled (being the "Discharged
Rights and Obligations");
(ii) the Borrower and the New Lender shall assume obligations towards
one another and/or acquire rights against one another which differ
from the Discharged Rights and Obligations only insofar as the
Borrower and the New Lender have assumed and/or acquired the same
in place of the Borrower and the Existing Lender;
(iii) the Administrative Agent, the New Lender and other Lenders shall
acquire the same rights and assume the same obligations between
themselves as they would have acquired and assumed had the New
Lender been an Existing Lender with the rights and/or obligations
acquired or assumed by it as a result of the transfer and to that
extent the Administrative Agent and the Existing Lender shall each
be released from further obligations to each other under the
Finance Documents; and
(iv) the New Lender shall become a Party as a "Lender".
24 CHANGES TO THE OBLIGORS
No Obligor may assign any of its rights or transfer any of its rights or
obligations under the Finance Documents.
25 ROLE OF THE ADMINISTRATIVE AGENT
25.1 Appointment of the Administrative Agent
(a) Each other Lender appoints the Administrative Agent to act as its agent
under and in connection with the Finance Documents.
(b) Each other Lender authorises the Administrative Agent to exercise the
rights, powers, authorities and discretions specifically given to the
Administrative Agent under or in connection with the Finance Documents
together with any other incidental rights, powers, authorities and
discretions.
25.2 Duties of the Administrative Agent
(a) The Administrative Agent shall promptly forward to a Party the original
or a copy of any document which is delivered to the Administrative Agent
for that Party by any other Party.
(b) Except where a Finance Document specifically provides otherwise, the
Administrative Agent is not obliged to review or check the adequacy,
accuracy or completeness of any document it forwards to another Party.
(c) If the Administrative Agent receives notice from a Party referring to
this Agreement, describing an Event of Non-compliance and stating that
the circumstance described is an Event of Non-compliance, it shall
promptly notify the Lenders.
(d) If the Administrative Agent is aware of the non-payment of any principal,
interest, commitment fee or other fee payable to a Finance Party (other
than the Administrative Agent) under this Agreement it shall promptly
notify the other Finance Parties.
(e) The Administrative Agent's duties under the Finance Documents are solely
mechanical and administrative in nature.
25.3 No fiduciary duties
(a) Nothing in this Agreement constitutes the Administrative Agent as a
fiduciary of any other person.
(b) The Administrative Agent shall not be bound to account to any Lender for
any sum or the profit element of any sum received by it for its own
account.
25.4 Business with the Obligors
The Administrative Agent may accept deposits from, lend money to and generally
engage in any kind of banking or other business with any Obligor.
25.5 Rights and discretions of the Administrative Agent
(a) The Administrative Agent may rely on:
(i) any representation, notice or document believed by it to be
genuine, correct and appropriately authorised; and
(ii) any statement made by a director, authorised signatory or employee
of any person regarding any matters which may reasonably be
assumed to be within his knowledge or within his power to verify.
(b) The Administrative Agent may assume (unless it has received notice to the
contrary in its capacity as agent for the Lenders) that:
(i) no default has occurred (unless it has actual knowledge of a
default arising under Clause 21.1(a) (Non-payment)); and
(ii) any right, power, authority or discretion vested in any Party or
the Lenders has not been exercised.
(c) The Administrative Agent may engage, pay for and rely on the advice or
services of any lawyers, accountants, surveyors or other experts.
(d) The Administrative Agent may act in relation to the Finance Documents
through its personnel and agents.
(e) The Administrative Agent may disclose to any other Party any information
it reasonably believes it has received as agent under this Agreement.
(f) Notwithstanding any other provision of any Finance Document to the
contrary, the Administrative Agent is not obliged to do or omit to do
anything if it would or might in its reasonable opinion constitute a
breach of any law or regulation or a breach of a fiduciary duty or duty
of confidentiality.
25.6 Majority Lenders' instructions
(a) Unless a contrary indication appears in a Finance Document, the
Administrative Agent shall (i) exercise any right, power, authority or
discretion vested in it as Administrative Agent in accordance with any
instructions given to it by the Majority Lenders (or, if so instructed by
the Majority Lenders, refrain from exercising any right, power, authority
or discretion vested in it as Administrative Agent) and (ii) not be
liable for any act (or omission) if it acts (or refrains from taking any
action) in accordance with an instruction of the Majority Lenders.
(b) Unless a contrary indication appears in a Finance Document, any
instructions given by the Majority Lenders will be binding on all the
Finance Parties.
(c) The Administrative Agent may refrain from acting in accordance with the
instructions of the Majority Lenders (or, if appropriate, the Lenders)
until it has received such security as it may require for any cost, loss
or liability (together with any associated VAT) which it may incur in
complying with the instructions.
(d) In the absence of instructions from the Majority Lenders, (or, if
appropriate, the Lenders) the Administrative Agent may act (or refrain
from taking action) as it considers to be in the best interest of the
Lenders.
(e) The Administrative Agent is not authorised to act on behalf of a Lender
(without first obtaining that Lender's consent) in any legal or
arbitration proceedings relating to any Finance Document.
25.7 Responsibility for documentation
The Administrative Agent:
(a) is not responsible for the adequacy, accuracy and/or completeness of any
information (whether oral or written) supplied by the Administrative
Agent, the Borrower or any other person given in or in connection with
any Finance Document; or
(b) is not responsible for the legality, validity, effectiveness, adequacy or
enforceability of any Finance Document or any other agreement,
arrangement or document entered into, made or executed in anticipation of
or in connection with any Finance Document.
25.8 Exclusion of liability
(a) Without limiting paragraph (b) below, the Administrative Agent shall not
be liable for any action taken by it under or in connection with any
Finance Document, unless directly caused by its gross negligence or
wilful misconduct.
(b) No Party (other than the Administrative Agent) may take any proceedings
against any officer, employee or agent of the Administrative Agent in
respect of any claim it might have against the Administrative Agent or in
respect of any act or omission of any kind by that officer, employee or
agent in relation to any Finance Document and any officer, employee or
agent of the Administrative Agent may rely on this Clause.
(c) The Administrative Agent shall not be liable for any delay (or any
related consequences) in crediting an account with an amount required
under the Finance Documents to be paid by the Administrative Agent if the
Administrative Agent has taken all necessary steps as soon as reasonably
practicable to comply with the regulations or operating procedures of any
recognised clearing or settlement system used by the Administrative Agent
for that purpose.
25.9 Lender's indemnity to the Administrative Agent
Each Lender shall (in proportion with its participation in the Loan) indemnify
the Administrative Agent within three Business Days of demand against any cost,
loss or liability incurred by the Administrative Agent (otherwise than by reason
of the Administrative Agent's gross negligence or wilful misconduct) in acting
as Administrative Agent under the Finance Documents (unless the Administrative
Agent has been reimbursed by the Borrower pursuant to a Finance Document).
25.10 Resignation of the Administrative Agent
The Administrative Agent may resign by giving notice to the Lenders and the
Borrower, in which case the Lenders (after consultation with the Borrower) may
appoint a successor Administrative Agent.
25.11 Confidentiality
(a) In acting as Administrative Agent for the Finance Parties, the
Administrative Agent shall be regarded as acting through its agency
division which shall be treated as a separate entity from any other of
its divisions or departments.
(b) If information is received by another division or department of the
Administrative Agent, it may be treated as confidential to that division
or department and the Administrative Agent shall not be deemed to have
notice of it.
25.12 Relationship with the Lenders
The Administrative Agent may treat each Lender as a Lender entitled to payments
under this Agreement and unless it has received not less than five Business Days
prior notice from that Lender to the contrary in accordance with the terms of
this Agreement.
25.13 Credit appraisal by the Lenders
Without affecting the responsibility of the Borrower for information supplied by
it or on its behalf in connection with any Finance Document, each Lender
confirms to the Administrative Agent that it has been, and shall continue to be,
solely responsible for making its own independent appraisal and investigation of
all risks arising under or in connection with any Finance Document including but
not limited to:
(a) the financial condition, status and nature of the Borrower;
(b) the legality, validity, effectiveness, adequacy or enforceability of any
Finance Document and any other agreement, arrangement or document entered
into, made or executed in anticipation of, under or in connection with
any Finance Document;
(c) whether that Lender has recourse, and the nature and extent of that
recourse, against any Party or any of its respective assets under or in
connection with any Finance Document, the transactions contemplated by
the Finance Documents or any other agreement, arrangement or document
entered into, made or executed in anticipation of, under or in connection
with any Finance Document; and
(d) the adequacy, accuracy and/or completeness of any other information
provided by the Administrative Agent, any Party or by any other person
under or in connection with any Finance Document, the transactions
contemplated by the Finance Documents or any other agreement, arrangement
or document entered into, made or executed in anticipation of, under or
in connection with any Finance Document.
25.14 Deduction from amounts payable by the Administrative Agent
If any Party owes an amount to the Administrative Agent under the Finance
Documents the Administrative Agent may, after giving notice to that Party,
deduct an amount not exceeding that amount from any payment to that Party which
the Administrative Agent would otherwise be obliged to make under the Finance
Documents and apply the amount deducted in or towards satisfaction of the amount
owed. For the purposes of the Finance Documents that Party shall be regarded as
having received any amount so deducted.
26 SHARING AMONG THE FINANCE PARTIES
26.1 Payment to Finance Parties
If a Finance Party (a "Recovering Finance Party") receives or recovers any
amount from the Borrower (including by set-off) other than in accordance with
Clause 27 (Payment mechanics) and applies that amount to a payment due under the
Finance Documents then:
(a) the Recovering Finance Party shall, within three Business Days, notify
details of the receipt or recovery, to the Administrative Agent;
(b) the Administrative Agent shall determine whether the receipt or recovery
is in excess of the amount the Recovering Finance Party would have been
paid had the receipt or recovery been received or made by the
Administrative Agent and distributed in accordance with Clause 27
(Payment mechanics), without taking account of any Tax which would be
imposed on the Administrative Agent in relation to the receipt, recovery
or distribution; and
(c) the Recovering Finance Party shall, within three Business Days of demand
by the Administrative Agent, pay to the Administrative Agent an amount
(the "Sharing Payment") equal to such receipt or recovery less any amount
which the Administrative Agent determines may be retained by the
Recovering Finance Party as its share of any payment to be made, in
accordance with Clause 27.5 (Partial payments).
26.2 Redistribution of payments
The Administrative Agent shall treat the Sharing Payment as if it had been paid
by the Borrower and distribute it between the Finance Parties (other than the
Recovering Finance Party) in accordance with Clause 27.5 (Partial payments).
26.3 Recovering Finance Party's rights
(a) On a distribution by the Administrative Agent under Clause 26.2
(Redistribution of payments), the Recovering Finance Party will be
subrogated to the rights of the Finance Parties which have shared in the
redistribution.
(b) If and to the extent that the Recovering Finance Party is not able to
rely on its rights under paragraph (a) above, each Borrower shall be
liable to the Recovering Finance Party for a debt equal to the Sharing
Payment which is immediately due and payable.
26.4 Reversal of redistribution
If any part of the Sharing Payment received or recovered by a Recovering Finance
Party becomes repayable and is repaid by that Recovering Finance Party, then:
(a) each Finance Party which has received a share of the relevant Sharing
Payment pursuant to Clause 26.2 (Redistribution of payments) shall, upon
request of the Administrative Agent, pay to the Administrative Agent for
account of that Recovering Finance Party an amount equal to the
appropriate part of its share of the Sharing Payment (together with an
amount as is necessary to reimburse that Recovering Finance Party for its
proportion of any interest on the Sharing Payment which that Recovering
Finance Party is required to pay); and
(b) that Recovering Finance Party's rights of subrogation in respect of any
reimbursement shall be cancelled and each Borrower will be liable to the
reimbursing Finance Party for the amount so reimbursed.
26.5 Exceptions
(a) This Clause 26.5 shall not apply to the extent that the Recovering
Finance Party would not, after making any payment pursuant to this
Clause, have a valid and enforceable claim against the Borrower.
(b) A Recovering Finance Party is not obliged to share with any other Finance
Party any amount which the Recovering Finance Party has received or
recovered as a result of taking legal or arbitration proceedings, if:
(i) it notified that other Finance Party of the legal or arbitration
proceedings; and
(ii) that other Finance Party had an opportunity to participate in
those legal or arbitration proceedings but did not do so as soon
as reasonably practicable having received notice and did not take
separate legal or arbitration proceedings.
27 PAYMENT MECHANICS
27.1 Payments to the Administrative Agent
(a) On each date on which the Borrower or a Lender is required to make a
payment under a Finance Document, the Borrower or Lender shall make the
same available to the Administrative Agent (unless a contrary indication
appears in a Finance Document) for value on the due date at the time and
in such funds specified by the Administrative Agent as being customary at
the time for settlement of transactions in the relevant currency in the
place of payment.
(b) Payment shall be made to such account in the principal financial centre
of the country of that currency and with such bank as the Administrative
Agent specifies.
27.2 Distributions by the Administrative Agent
Each payment received by the Administrative Agent under the Finance Documents
for another Party shall, subject to Clause 27.3 (Distributions of the Borrower)
and Clause 27.4 (Clawback) be made available by the Administrative Agent as soon
as practicable after receipt to the Party entitled to receive payment in
accordance with this Agreement, to such account as that Party may notify to the
Administrative Agent by not less than five Business Days' notice with a bank in
the principal financial centre of the country of that currency.
27.3 Distributions to the Borrower
The Administrative Agent may (with the consent of the Borrower or in accordance
with Clause 15.4 (Set-off)) apply any amount received by it for the Borrower in
or towards payment (on the date and in the currency and funds of receipt) of any
amount due from the Borrower under the Finance Documents or in or towards
purchase of any amount of any currency to be so applied.
27.4 Clawback
(a) Where a sum is to be paid to the Administrative Agent under the Finance
Documents for another Party, the Administrative Agent is not obliged to
pay that sum to that other Party (or to enter into or perform any related
exchange contract) until it has been able to establish to its
satisfaction that it has actually received that sum.
(b) If the Administrative Agent pays an amount to another Party and it proves
to be the case that the Administrative Agent had not actually received
that amount, then the Party to whom that amount (or the proceeds of any
related exchange contract) was paid by the Administrative Agent shall on
demand refund the same to the Administrative Agent together with interest
on that amount from the date of payment to the date of receipt by the
Administrative Agent, calculated by the Administrative Agent to reflect
its cost of funds.
27.5 Partial payments
(a) If the Administrative Agent receives a payment that is insufficient to
discharge all the amounts then due and payable by the Borrower under the
Finance Documents, the Administrative Agent shall apply that payment
towards the obligations of the Borrower under the Finance Documents in
the following order:
(i) first, in or towards payment pro rata of any unpaid fees, costs
and expenses of the Administrative Agent under the Finance
Documents;
(ii) secondly, in or towards payment pro rata of any accrued interest,
fee or commission due but unpaid under this Agreement;
(iii) thirdly, in or towards payment pro rata of any principal due but
unpaid under this Agreement; and
(iv) fourthly, in or towards payment pro rata of any other sum due but
unpaid under the Finance Documents.
(b) The Administrative Agent shall, if so directed by all Lenders, vary the
order set out in paragraphs (a)(ii) to (iv) above.
(c) Paragraphs (a) and (b) above shall override any appropriation made by the
Borrower.
27.6 No set-off by the Borrower
All payments to be made by the Borrower under the Finance Documents shall be
calculated and be made without (and free and clear of any deduction for) set-off
or counterclaim.
27.7 Business Days
(a) Any payment which is due to be made on a day that is not a Business Day
shall be made on the next Business Day in the same calendar month (if
there is one) or the preceding Business Day (if there is not).
(b) During any extension of the due date for payment of any principal or
Unpaid Sum under this Agreement interest is payable on the principal or
Unpaid Sum at the rate payable on the original due date.
28 NOTICES
28.1 Communications in writing
Any communication to be made under or in connection with the Finance Documents
shall be made in writing and, unless otherwise stated, may be made by fax or
letter.
28.2 Addresses
The address and fax number (and the department or officer, if any, for whose
attention the communication is to be made) of each Party for any communication
or document to be made or delivered under or in connection with the Finance
Documents is:
(a) in the case of the Borrower:
Ship Finance International Limited
c/o Frontline Management AS
Att.: Finance Dept.
X.X. Xxx 0000 Xxxx
XX-0000 Xxxx
Xxxxxx
Telefax: x00 00 00 00 00
(b) in the case of the Administrative Agent:
For credit matters:
DNB NOR Bank ASA,
Att.: Shipping Division
XX-0000 Xxxx
Xxxxxx
Telefax: x00 00 00 00 00
For administrative matters:
DNB NOR Bank ASA,
Att.: Loan Xxxxxxxxxxxxxx Xxxxxxxx
XX-0000 Xxxx
Xxxxxx
Telefax: x00 00 00 00 00
(c) In the case of the Security Agent:
DNB NOR Bank ASA,
Att.: Xxxxxxxxxx Xxxxxxxxxx Xxxxxxxx
XX-0000 Xxxx
Xxxxxx
Telefax: x00 00 00 00 00
(d) to each Lender at its address and fax number specified in Schedule 2
or any substitute address or fax number or department or officer as the Party
may notify to the Administrative Agent (or the Administrative Agent may notify
to the other Parties, if a change is made by the Administrative Agent) by not
less than five Business Days' notice.
28.3 Notification of address and fax number
Promptly upon receipt of notification of an address and fax number or change of
address or fax number pursuant to Clause 28.2 (Addresses) or changing its own
address or fax number, the Administrative Agent shall notify the other Parties.
28.4 English language
(a) Any notice given under or in connection with any Finance Document must be
in English.
(b) All other documents provided under or in connection with any Finance
Document must be:
(i) in English; or
(ii) if not in English, and if so required by the Administrative Agent,
accompanied by a certified English translation and, in this case,
the English translation shall prevail unless the document is a
constitutional, statutory or other official document.
29 CALCULATIONS AND CERTIFICATES
29.1 Accounts
In any litigation or arbitration proceedings arising out of or in connection
with a Finance Document, the entries made in the accounts maintained by a
Finance Party are prima facie evidence of the matters to which they relate.
29.2 Certificates and Determinations
Any certification or determination by a Finance Party of a rate or amount under
any Finance Document is, in the absence of manifest error, conclusive evidence
of the matters to which it relates.
29.3 Day count convention
Any interest, commission or fee accruing under a Finance Document shall accrue
from day to day and is calculated on the basis of the actual number of days
elapsed and a year of 360 days or, in any case where the practice in the London
interbank market differs, in accordance with that market practice.
30 PARTIAL INVALIDITY
If, at any time, any provision of the Finance Documents is or becomes illegal,
invalid or unenforceable in any respect under any law of any jurisdiction,
neither the legality, validity or enforceability of the remaining provisions nor
the legality, validity or enforceability of such provision under the law of any
other jurisdiction shall in any way be affected or impaired.
31 AMENDMENTS
31.1 Amendments
Except as otherwise provided herein, the Administrative Agent (acting on behalf
of the Majority Lenders) may from time to time agree in writing to amend this
Agreement or to waive, prospectively or retrospectively, any of the requirements
of this Agreement and any amendments or waivers so agreed shall be binding on
all the Finance Parties and the Obligors.
31.2 Consent
An amendment or waiver relating to the following matters shall not be made
without the prior written consent of each Lender affected thereby:
a) any increase in the Commitment of such Lender;
b) a reduction in the proportion of any amount received or recovered
(whether by way of set-off, combination of accounts or otherwise) in
respect of any amount due from an Obligor under this Agreement to which
any Lender is entitled;
c) a decrease in the Margin or any other interest payment, or fees or other
amounts due under this Agreement to any Lender from an Obligor or any
other party to this Agreement;
d) any change in the currency of account;
e) the deferral of the date for payment of any principal, interest, fee or
any other amount due under this Agreement to any Lender from an Obligor
or any other party to this Agreement;
f) the deferral of the term of the Loan;
g) the provisions of Clause 23.1 (Transfers by Lenders);
h) any changes to the definition of "Majority Lenders";
i) the waiver or release of any Security Document or any of the obligations
of any Owner under Clause 22 (Guarantee) other than in accordance with
the terms of Clause 6.2; and
j) a change to any provision which contemplates the need for the consent or
approval of all the Lenders.
31.3 Technical Amendments
The Administrative Agent may determine administrative matters and make technical
amendments arising out of manifest errors on the face of this Agreement, where
such amendments would not prejudice or otherwise be adverse to the position of
any Lender under this Agreement, without reference to the Lenders.
31.4 Amendments affecting the Administrative Agent
Notwithstanding any other provision of this Agreement, the Administrative Agent
shall not be obliged to agree to any amendment or waiver if the same would amend
or waive any of the Administrative Agent's rights under this Agreement or
subject the Administrative Agent to any additional obligations under this
Agreement.
32 REMEDIES AND WAIVERS
No failure to exercise, nor any delay in exercising, on the part of any Finance
Party, any right or remedy under the Finance Documents shall operate as a
waiver, nor shall any single or partial exercise of any right or remedy prevent
any further or other exercise or the exercise of any other right or remedy. The
rights and remedies provided in this Agreement are cumulative and not exclusive
of any rights or remedies provided by law.
33 GOVERNING LAW AND JURISDICTION
33.1 Governing law
This Agreement is governed by Norwegian law.
33.2 Jurisdiction
Oslo District Court (Oslo tingrett) has exclusive jurisdiction to settle any
dispute arising out of or in connection with this Agreement, but this shall not
prevent any Finance Party from taking proceedings against the Borrower in any
other courts with jurisdiction including any jurisdiction where a Vessel may be
found and the Borrower irrevocably submits to the jurisdiction of each such
court. To the extent allowed by law, the Finance Parties may take concurrent
proceedings in any number of jurisdictions.
SCHEDULE I
The Owners and the Vessels
Country of SH/ IMO Tranche
Owners Incorporation Vessel DH number Built Dwt. Flag (USD)
------ ------------- ------ --- ------ ----- ---- ---- -----
Langkawi Shipping Ltd. Liberia "Front Birch" SH 8915407 1991 152,000 MI 9,833,230
Sibu Shipping Ltd. Liberia "Front Maple" SH 8915392 1991 152,000 MI 9,833,230
Granite Shipping Company Ltd. Bahamas "Front Granite" SH 8902955 1991 142,031 MI 9,552,280
Puerto Xxxxxxx Shipping Co. S.A. Panama "Front Xxxxx" SH 8809919 1991 147,143 MI 9,552,280
Front Tujuh Pte. Ltd. Singapore "Front Emperor" SH 8906987 1992 147,273 SING 9,973,704
Southwest Tankers Inc. Liberia "Front Sunda" SH 8918930 1992 142,031 MI 9,973,704
West Tankers Inc. Liberia "Front Comor" SH 8918942 1993 142,031 MI 10,535,603
Fourways Marine Limited Liberia "Front Spirit" SH 8906999 1993 147,273 MI 10,535,603
Front Pride Shipping Inc. Liberia "Front Pride" DH 9018464 1993 149,686 NIS 19,592,833
Front Splendour Shipping Inc. Liberia "Front Splendour" DH 9104885 1995 149,745 NIS 23,701,007
Front Glory Shipping Inc. Liberia "Front Glory" DH 9087972 1995 149,834| NIS 23,701,007
Front Ardenne Inc. Liberia "Front Ardenne" DH 9150834 1997 153,000 NIS 27,160,073
Patrio Shipping Ltd. Liberia "Front Hunter" DH 9157727 1998 153,344 NIS 28,560,781
Bolzano Pte. Ltd. Singapore "Mindanao" DH 9169421 1998 158,000 SING 28,560,781
Front Brabant Inc. Liberia "Front Brabant" DH 9155808 1998 153,000 NIS 28,560,781
Cirebon Shipping Pte. Ltd. Singapore "Front Vanadis" SH 8902412 1990 285,782 SING 11,394,505
Fox Maritime Pte. Ltd. Singapore "Front Sabang" SH 8716772 1990 285,715 SING 11,394,505
Front Empat Pte. Ltd. Singapore "Front Highness" SH 8920921 1991 284,420 SING 12,291,535
Front Lima Pte. Ltd. Singapore "Front Lady" SH 8906913 1991 284,420 SING 12,291,535
Front Enam Pte. Ltd. Singapore "Front Lord" SH 8906901 1991 284,420 SING 12,291,535
Front Tiga Pte. Ltd. Singapore "Front Duke" SH 9005273 1991 284,420 SING 12,923,671
Sea Ace Corporation Liberia "Front Ace" SH 9012824 1993 275,546 LIB 13,345,097
Front Dua Xxx.Xxx. Singapore "Front Duchess" SH 9046019 1993 284,480 SING 13,345,097
Edinburgh Navigation S.A. Liberia "Edinburgh" SH 9005223 1993 302,493 LIB 14,117,708
Golden Bayshore Shipping Corporation Liberia "Navix Astral" SH 9172856 1996 275,644 PA 14,960,556
Golden Sound Corporation Liberia "Front Vista" DH 9153525 1998 300,149 MI 40,785,662
Golden Seaway Corporation Liberia "Front Vanguard" DH 9153513 1998 300,058 MI 40,785,662
Golden Fjord Corporation Liberia "Xxxxx" DH 9158264 1999 300,144 IOM 42,765,016
Golden Estuary Corporation Liberia "Front Comanche" DH 9172674 1999 300,133 FRA 42,765,016
Golden Current Limited Isle of Man "Opalia" DH 9172844 1999 302,193 IOM 42,765,016
Golden Tide Corporation Liberia "Omala" DH 9166742 1999 306,009 IOM 42,765,016
Oscilla Shipping Limited Isle of Man "Oscilla" DH 9172856 2000 302,193 IOM 44,500,000
Ariake Transport Corporation Liberia "Ariake" DH 9196606 2001 298,530 BS 46,381,850
Front Stratus Inc. Liberia "Front Stratus" DH 9248485 2002 298,500 LIB 48,019,355
Front Saga Inc. Liberia "Front Page" DH 9248497 2002 298,500 LIB 48,019,355
Front Serenade Inc. Liberia "Front Serenade" DH 9248473 2002 299,152 LIB 48,019,355
Front Falcon Corporation Liberia "Front Falcon" DH 9238856 2002 308,000 BS 48,019,355
Hitachi Hull 4983 Ltd. Liberia "Otina" DH 9196644 2002 296,000 IOM 48,019,355
Front Xxxxx Pte. Ltd. Singapore "Front Climber" DH 8906896 1991 169,178 SING 19,505,288
Transcorp Pte. Ltd. Singapore "Front Xxxxxx" DH 9002740 1991 169,142 SING 19,505,288
Xxxxxxxx Shipping Limited Liberia "Front Driver" DH 0000000 1991 169,177 MI 19,505,288
Front Sembilan Pte. Ltd. Singapore "Front Leader" DH 8906860 1991 169,381 SING 19,505,288
Katong Investments Limited Liberia "Front Breaker" DH 8906872 1991 169,381 MI 19,505,288
Aspinall Pte. Ltd. Singapore "Front Viewer" DH 9153513 1992 169,381 SING 20,773,375
Rettie Pte. Ltd. Singapore "Front Striver" DH 9002752 1992 169,204 SING 20,773,375
Blizana Pte. Ltd. Singapore "Front Rider" DH 9002764 1992 169,718 SING 20,773,375
SH = Single Xxxx
XX = Double Hull
MI = Xxxxxxxx Island
NIS = Norwegian International Shipregister
SING = Singapore
LIB = Liberia
PA = Panama
IOM = Isle of Man
BS = Bahamas FRA = France
SCHEDULE 2
The Original Lenders
Original Lenders Title Commitment
---------------- ----- ----------
DnB NOR Bank ASA Mandated lead arranger USD 100,109,804.75
XX-0000 Xxxx
Xxxxxx
Att: Xx Xxxxxxx Xxxxxx Xxxxx
Fax: x00 00 00 00 00
Nordea Bank Norge ASA Mandated lead arranger USD 100,109,804.75
Middelthuns gate 17
X.X.Xxx 0000 Xxxxxxx
XX-0000 Xxxx
Xxxxxx
Att: Xx Xxxx Xxxxxx
Fax: x00 00 00 00 00
Fortis Bank (Nederland) N.V. Mandated lead arranger USD 100,109,804.75
Xxxxxx XXXx xxxx 00
XX-0000 Xxxx
Xxxxxx Administrative contact:
Xxxxxxxxxx 00
XX-0000 XX Xxxxxxxxx
The Netherlands
Att: Xx Xxx xxx Xxxxxxxx
Fax: x00 00 000 00 00
Calyon S.A. Mandated lead arranger USD 100,109,804.75
0 Xxxx Xx Xxxxxxxxx Xxxx Xxxxxx
XX-00000 Xxxxx La Defence Cedex
France
Att: Xx Xxxxxx Xxxxx-Xxxxxx
Fax: x00 000 00 0000
Danish Ship Finance Lead arranger USD 50,000,000.00
(Danmarks Skibskreditfond)
Sankt Xxxxx Xxxxx 0
XX-0000 X0xxxxxxx X
Denmark
Att: Loan Administration
Fax: x00 00 00 00 00
Deutsche Bank AG in Hamburg / Lead arranger USD 50,000,000.00
Schiffshypothekenbank zu Lubeck XX
Xxxxxxxxxxxx 0
XX-00000 Xxxxxxx
Xxxxxxx
Att: Xx Xxxx-Xxxxxxx Xxxxx
Fax: x00 00 0000 0000
Deutsche Schiffsbank Lead arranger USD 50,000,000.00
Aktiengesellschaft
Domshof 17
XX-00000 Xxxxxx
Germany
Att: Xx Xxxxx Xxxxxxx / Xx Xxxx Xxxxxx
Fax: x00 000 00 00 000
HSH Nordbank AG Lead arranger USD 50,000,000.00
Xxxxxxx-Xxxxxxxxx-Xxxxx 00
XX-00000 Xxxxxxx
Xxxxxxx
Att: Xx Xxxxx Xxxxxx
Fax: x00 00 00 00 000 00
ING Bank N.V., London Branch Lead arranger USD 50,000,000.00
00 Xxxxxx Xxxx
XX-Xxxxxx XX0X 0XX
Xxxxxx Xxxxxxx
Att: Mr Xxxxxxx Xxxxx
Fax: x00 00 0000 0000
Lloyds TSB Bank plc Lead arranger USD 50,000,000.00
Xxxx Xxxxx, Xxxx Xxxxxx
XX-Xxxxxxx XX0 0XX
Xxxxxx Xxxxxxx
Att: Xx Xxxx Xxxxxxxx / Xx Xxx Xxxxxx
Fax: x00 000 000 0000
Scotiabank Europe plc. Lead arranger USD 50,000,000.00
x/x Xxx Xxxx xx Xxxx Xxxxxx
WBO - Loan Administration &
Agency Operations
0xx Xxxxx,
000 Xxxx Xx. Xxxx,
Xxxxxxx, Xxxxxxx
Xxxxxx
Att: M Xxxx Xxxxxx
Fax: x0 000 000 0000
Skandinaviska Enskilda Banken Lead arranger USD 50,000,000.00
AB (publ.)
Rissneleden 110 RB8
XX-000 00 Xxxxxxxxx
Xxxxxx
Att: Xx Xxxxx Xxxxxxx
Fax: x00 0 000 00 00
Sumitomo Mitsui Banking Corporation Lead arranger USD 50,000,000.00
Xxxxxx xxx Xxxx, 00 - Boite 18
XX-0000 Xxxxxxxxx
Xxxxxxx
Att: Xx Xxxxxxxx Xxxxx, CBDE2
Fax: x00 0 000 0000
Swedbank (ForeningsSparbanken Lead arranger USD 50,000,000.00
AB (publ))
XX-000 00 Xxxxxxxxx
Xxxxxx
Att: Shipping Loan Xxxxxxxxxxxxxx, X0,
Xx. Xxxx Xxxxx / Xx Xxxxxxx Xxxxxxxxx
Fax: x00 0 000 0000
Bayerische Hypo- und Vereinsbank AG Lead arranger USD 50,000,000.00
Xxxxx Xxxx 00
XX-00000 Xxxxxxx
Xxxxxxx
Att: Xx Xxxx Xxxxx
Fax: x00 00 0000 0000
The Governor and Company of the Arranger USD 40,000,000.00
Bank of Xxxxxxx
Xxxx Xxxxx
XX-Xxxxxx 0
Xxxxxxx
Att: Xx Xxxx Xxxxx Xxxx
Fax: x000 0 0000000/ x000 0 0000000
The Governor and Company of the Arranger USD 40,000,000.00
Bank of Scotland
Corporate
New Uberior House
00 Xxxx Xxxx Xxxxxx
XX-Xxxxxxxxx XX0 0XX
Xxxxxx Xxxxxxx
Att: Marine Finance
Fax: x00 000 000 0000
BNP Paribas Oslo Branch Arranger USD 40,000,000.00
X.X. Xxx 000 Xxxxxxx
XX-0000 Xxxx Xxxxxx
Att: Xx Xxxxxx De Fontenay
Fax: x00 00 00 00 00
NIB Capital Bank N.V. Co-Arranger USD 30,500,000.00
Xxxxxxxxxxxxx 0
XX-0000 XX Xxx Xxxxx
Xxx Xxxxxxxxxxx
Att: Xx Xxxxxxx Xxxxxxx
Fax: x00 00 000 0000
Citibank N.A. Co-Arranger USD 30,500,000.00
0xx Xxxxx, 0 Xxxxxxx Xxxxxxxx,
Xxxx of Dogs
XX-Xxxxxx X00 0XX
Xxxxxx Xxxxxxx
Att: UK Loans Processing Unit
Fax: x00 000 000 0000
SCHEDULE 3
Part I
Conditions precedent to the delivery of the first Drawdown Notice
(a) a copy of the articles of incorporation of the Borrower together with its
complete by-laws up to date or other relevant document which verifies its
constitution under the relevant jurisdiction, certified by an officer or
representative of the Borrower;
(b) a copy of a resolution of the board of directors of the Borrower:
(i) approving the terms of, and the transactions contemplated by, the
Finance Documents to which it is a party and resolving that it
execute the Finance Documents to which it is a party;
(ii) authorising a specified person or persons to execute the Finance
Documents to which it is a party on its behalf; and
(iii) authorising a specified person or persons, on its behalf, to sign
and/or despatch all documents and notices (including, the Drawdown
Notice and any Selection Notice) to be signed and/or despatched by
it under or in connection with the Finance Documents to which it
is a party.
(c) the Insurance Report and Certificate;
(d) a copy of the Transaction Documents;
(e) evidence that the Free Cash of the Charterer is minimum USD 244,700,000;
(f) a written confirmation from the Borrower that no event of default has
occurred or is continuing under the Senior Note Documents;
(g) the DOC of the Manager;
(h) certified copies of the passports of the directors and the authorised
representatives of the Borrower and the Owners together with proof of
their address and any other identification or similar document any Lender
may reasonably require on the basis of mandatory regulatory laws of the
country of such Lender; and
(i) the satisfactory legal opinion from Xxxxxx & Xxxxxx confirming that the
Finance Documents will not violate or be in conflict with the Senior Note
Documents.
Part II
Conditions precedent to the delivery of each Drawdown Notice
(a) a copy of the articles of incorporation of the Owner(s) relative to the
Vessel(s) listed in the Drawdown Notice together with its complete
by-laws up to date or other relevant document which verifies its
constitution under the relevant jurisdiction, certified by an officer or
representative of the Borrower
(b) a copy of a resolution of the board of directors of such Owner:
(i) approving the terms of, and the transactions contemplated by, the
Finance Documents to which it is a party and resolving that it
execute the Finance Documents to which it is a party;
(ii) authorising a specified person or persons to execute the Finance
Documents to which it is a party on its behalf; and
(iii) authorising a specified person or persons, on its behalf, to sign
and/or despatch all documents and notices (including, the Drawdown
Notice and any Selection Notice) to be signed and/or despatched by
it under or in connection with the Finance Documents to which it
is a party.
(c) a copy of the relevant Vessel's SMCs;
(d) a certified copy of the classification certificate of the relevant Vessel
as required by Clause 19.3 (Classification);
(e) the Compliance Certificate duly executed by the Borrower;
(f) a technical survey of the relevant Vessel if required by the
Administrative Agent by surveyors approved by the Administrative Agent at
the cost of the Borrower;
(g) evidence that the insurances on the relevant Vessel as required by Clause
19.8 (Insurances) have been taken out and are in full force and effect on
the Drawdown Date; and
(h) a valuation of the relevant Vessel(s) in accordance with Clause 19.13
(Valuation) if required by the Administrative Agent.
Part III
Conditions precedent to each Drawdown Date
(a) the certificates of ownership and encumbrances for the Vessel(s)
corresponding to the Tranche(s) requested evidencing the Owner's
ownership of its Vessel free from other encumbrances than the Mortgages;
(b) the Security Documents (but in respect of the Mortgages and the General
Assignments, only the documents connected to the Vessels involved in the
particular Drawdown) properly executed with evidence of the perfection of
the security rights created there under according to Clause 15
(Security);
(c) evidence of the Borrower's payment of any fees and costs due; and
(d) the satisfactory legal opinions of the following law firms on the laws
involved at the relevant Drawdown Dates:
FIRM LAWS OF
---- -------
Xxxxx Xxxxx & Xxxxxx Bermuda
Xxxxxx & Xxxxxx Xxxxxxxx Island
Xxxxxx & Xxxxxx Liberia
Xxxxx Xxxxxxx Bahamas
Xxxxxxxxx Xxxxxxxxxxx Isle of Man
Xxxxx Xxxxxxx & Fabrega Panama
Xxxxxxx Xxxx & Partners Singapore
Xxxxxxxx F0yen Advokatfirma DA Norway
SCHEDULE 4
Form of Drawdown Notice
To: DNB NOR BANK ASA
Date: [o]
USD 1,131,439,219 term loan facility agreement dated [o] (the "Loan Agreement")
We refer to Clause 4.1 (Delivery of the Drawdown Notice) of the Loan Agreement.
Capitalized terms defined in the Loan Agreement shall have the same meaning when
being used in this Drawdown Notice.
You are hereby irrevocably notified that we wish to make the following drawdown
of Tranche(s) pursuant to the terms and conditions of the Loan Agreement:
Requested Drawdown Date: [ ]
Principal Amount: [ ]
Interest Period: [ ]
Name of vessel(s) to be refinanced: [ ]
The proceeds of the Loan should be credited to [o] [insert name and number of
account].
We confirm that, as of the date hereof (i) each condition specified in Clause 3
(Conditions precedent) of the Loan Agreement is satisfied; (ii) each of the
representations and warranties set out in Clause 16 (Representations) of the
Loan Agreement is true and correct; and (iii) no event or circumstances has
occurred and is continuing which constitute or may constitute an Event of
Non-compliance.
Yours sincerely
for and on behalf of
Ship Finance International Limited
By: __________________________________
Name:
Title: [authorised officer]
SCHEDULE 5
Form of Selection Notice
To: DNB NOR BANK ASA
Date: [o]
[USD 1,131,439,219 term loan facility agreement dated [o] (the "Loan
Agreement")]
1. We refer to the Loan Agreement. Capitalised terms defined in the Loan
Agreement shall have the same meaning when being used in this Selection
Notice.
2. We refer to the Interest Period ending on [o].
3. We request that the next Interest Period for the Loan is [o].
4. We confirm that (i) each of the representations and warranties set out in
Clause 16 (Representations) of the Loan Agreement is true and correct;
and that (ii) no event or circumstances has occurred and is continuing
which constitute or may constitute an Event of Non-compliance.
5. This Selection Notice is irrevocable.
Yours sincerely
for and on behalf of
Ship Finance International Limited
By: __________________________________
Name:
Title: [authorised officer]
SCHEDULE 6
Form of Transfer Certificate
To: DNB NOR BANK ASA as Agent
From: [The Existing Lender] (the "Existing Lender") and [The New Lender] (the
"New Lender") Dated:
[USD 1,131,439,219 term loan facility agreement dated [o] (the "Agreement")]
1. We refer to the Agreement. This is a Transfer Certificate. Terms defined
in the Agreement have the same meaning in this Transfer Certificate
unless given a different meaning in this Transfer Certificate.
2. We refer to Clause 23.4 (Procedure for transfer):
(a) The Existing Lender and the New Lender agree to the Existing Lender
transferring to the New Lender by novation all or part of the Existing
Lender's Commitment, rights and obligations referred to in the Schedule
in accordance with Clause 23.4 (Procedure for transfer).
(b) The proposed Transfer Date is [o].
(c) The Facility Office and address, fax number and attention details for
notices of the New Lender for the purposes of Clause 28.2 (Addresses) are
set out in the Schedule.
3. The New Lender expressly acknowledges the limitations on the Existing
Lender's obligations set out in paragraph (c) of Clause 23.3 (Limitation
of responsibility of Existing Lenders).
4. This Transfer Certificate is governed by Norwegian law.
THE SCHEDULE
Commitment/rights and obligations to be transferred
[insert relevant details: Address, fax number and attention details for
notices and account details for payments,]
[Existing Lender] [New Lender]
By: ________________________ By:________________________
This Transfer Certificate is accepted by the Administrative Agent and
the Transfer Date is confirmed as [o].
DNB NOR BANK ASA
By:
SCHEDULE 7
Compliance Certificate
To: DNB NOR BANK ASA
Date: [o]
USD 1,131,439,219 term loan facility agreement dated [o] (the "Loan Agreement")
We refer to the above Loan Agreement. Capitalised terms defined in the Loan
Agreement shall have the same meaning when being used in this Compliance
Certificate.
With reference to Clauses 17.2 (Compliance Certificate) and 18 (Financial
covenants) of the Loan Agreement, we confirm that as at [o] [insert relevant
quarterly date]:
(a) The aggregate Ship Value of all Vessels was USD [o]: The aggregate Ship
Value of all Vessels shall be minimum 140% of the Loan and the covenant
in Clause 18.1 is thus [not] satisfied.
(b) The Available Cash was [o]: The Available Cash shall be minimum USD
25,000,000 and the covenant in Clause 18.2 is thus [not] satisfied.
(c) The Working Capital was [o]: The Working Capital shall be positive and
the covenant in Clause 18.3 is thus [not] satisfied.
(d) The Minimum Equity Ratio was [o]: The Minimum Equity Ratio shall be at
least 20% and the covenant in Clause 18.34 is thus [not] satisfied.
(e) The Charter Service Reserve Deposit was [o]: The Charter Service Reserve
Deposit shall never be less than USD 55,000,000 and the Borrower is thus
[not] in an Event of Non-compliance according to Clause 21.1 (h).
We confirm that as of [insert relevant quarterly date] and the date of this
Compliance Certificate no Event of Non-compliance has occurred and is
continuing.
Yours sincerely
for and on behalf of
Ship Finance International Limited
By: __________________________________
Name:
Title: [authorised officer]
SCHEDULE 8
Interest Notification
To: Ship Finance International Limited
[o]
USD 1,131,439,219 term loan facility agreement dated [o] (the "Loan Agreement")
For the purpose of the Norwegian Financial Contracts Act, we inform you that the
nominal interest rate for the Loan stated below is based upon the aggregate of
the current LIBOR and the Margin for a three months Interest Period. The
calculation of the effective interest rate for the Loan is based upon the
aggregate of the nominal interest rate, fees, costs and expenses (to be accrued)
for three months Interest Periods. Furthermore, the calculation is based upon
linear repayment.
As per [o] these interest rates were:
Nominal interest rate: [o] p.a.
Effective interest rate: [o] p.a.
We emphasise that these interest rates are to be regarded as examples due to the
variation of interest rates of USD in the Eurocurrency market from time to time,
variations of interest rates between optional Interest Periods, and furthermore,
in respect of effective interest rates, variations as a result of the accrued
fees, costs and expenses from time to time and variations in case of non-linear
repayment or prepayment.
This letter is supplemental to the Loan Agreement and terms used herein shall
have the same meaning as defined in the Loan Agreement.
Yours faithfully,
DNB NOR BANK ASA
----------------------------
We hereby acknowledge receipt of this letter.
Ship Finance International Limited
By:_______________________
SCHEDULE 9
Security Documents
So long as any amount is owing to the Lenders, any Hedge Counterparty, the
Security Agent and the Administrative Agent under the Finance Documents and
unless provided herein, the Loan and any other obligation and liability that any
Obligor has or may incur towards the Finance Parties under the Finance Documents
shall be secured by the following documents, instruments and actions in form and
substance acceptable to the Agent:
1. Owners' Security Documents
(a) the Mortgage relative to each Vessel executed by the relevant Owner in
favour of the Security Agent substantially in the form as set out in
Exhibit A and registered over the relevant Vessel in the ship register
approved by all the Lenders;
(b) the Owners' General Assignments executed by each of the Owners in favour
of the Security Agent in the form as set out in Exhibit B in respect of
(i) the Insurances
(ii) the Earnings of the relevant Time Charter Party, or if relevant,
the Earnings of the relevant Bareboat Charter
(c) the Owners' Contract Assignment executed by each of the Owners in favour
of the Security Agent in the form as set out in Exhibit C in respect of
the assignment of
(i) each Management Agreement
(ii) the Administrative Services Agreement
(iii) the Charter Ancillary Agreement
(iv) each Time Charter Party
(v) each Bareboat Charter
(vi) the Performance Guarantee
2. Borrower's Security Documents
(a) The Earnings Account Charge executed by the Borrower in favour of the
Security Agent in the form as set out in Exhibit D in respect of the
Earnings Account.
(b) the Pledge of Shares in respect of all shares of each Owner executed by
the Borrower in favour of the Security Agent substantially in the form
set out in Exhibit E and the security of which shall be perfected as set
out therein.
3. Sub-Security Documents
(a) The Borrower's General Assignment executed by the Borrower in favour of
the Security Agent in the form as set out in Exhibit F in respect of the
assignment of:
(i) The Floating Charge
(ii) The Performance Guarantee
(iii) The Charterer Share Pledge
(iv) The Charter Ancillary Agreement
(v) the Administrative Services Agreement.
(b) The Charter Accounts Pledge Assignment executed by the Borrower in favour
of the Security Agent in the form as set out in Exhibit G.
SCHEDULE 10
Guarantee/Security release letter
To: [insert name]
Date: [o]
Dear Sirs,
RE: "[o]" (the "Vessel")
We hereby give you notice that all moneys due and to become due to the Finance
Parties under a term loan facility agreement dated [o] (the "Loan Agreement") in
relation to the Vessel have been prepaid, and you are hereby released from your
guarantee responsibility in connection with the Loan Agreement and you are
further released from the following Security Documents (as defined in the Loan
Agreement):
[ ]
Yours faithfully
By:__________________
For and on behalf of
DnB NOR Bank ASA
SCHEDULE 11
Repayment
(Column "Repayment 1-23" corresponds to the amount repayable for each Vessel on
each Repayment Date no 1-23 - and Column "Repayment 24" corresponds to the
amount repayable for each Vessel on the final Repayment Date)
(all amounts in USD) Repayment Repayment
Vessel name Hull Built Dwt Tranche 1-23 24
----------- ---- ----- --- ------- ---- --
Suezmaxes
Front Xxxxx XX 1991 152,000 9,833,230 409,718 409,716
Front Maple SH 1991 152,000 9,833,230 409,718 409,716
Front Granite SH 1991 142,031 9,552,280 398,012 398,004
Front Xxxxx XX 1991 147,143 9,552,280 398,012 398,004
Front Emperor SH 1992 147,273 9,973,704 415,571 415,571
Front Sunda SH 1992 142,031 9,973,704 415,571 415,571
Front Comor SH 1993 142,031 10,535,603 438,983 438,994
Front Spirit SH 1993 147,273 10,535,603 438,983 438,994
Front Pride DH 1993 149,683 19,592,833 542,100 7,124,533
Front Splendour DH 1995 149,745 23,701,007 536,921 11,351,824
Front Glory DH 1995 149,834 23,701,007 536,921 11,351,824
Front Ardenne DH 1997 153,000 27,160,073 520,882 15,179,787
Front Xxxxxxx XX 1998 153,000 28,560,781 508,720 16,860,221
Front Xxxxxx XX 1998 153,344 28,560,781 508,720 16,860,221
Mindanao DH 1998 158,000 28,560,781 508,720 16,860,221
Suezmax OBOs
Front Breaker DH 1991 169,381 19,505,288 693,091 3,564,195
Front Climber DH 1991 169,178 19,505,288 693,091 3,564,195
Xxxxx Xxxxxx XX 0000 169,177 19,505,288 693,091 3,564,195
Front Xxxxxx XX 1991 169,142 19,505,288 693,091 3,564,195
Front Leader DH 1991 169,381 19,505,288 693,091 3,564,195
Front Rider DH 1992 169,718 20,773,375 646,291 5,908,682
Front Xxxxxxx XX 1992 169,204 20,773,375 646,291 5,908,682
Front Viewer DH 1992 169,381 20,773,375 646,291 5,908,682
VLCCs
Front Sabang SH 1990 285,715 11,394,505 474,771 474,772
Front Vanadis SH 1990 285,782 11,394,505 474,771 474,772
Front Highness SH 1991 284,420 12,291,535 512,147 512,154
Front Lady SH 1991 284,420 12,291,535 512,147 512,154
Front Lord SH 1991 284,420 12,291,535 512,147 512,154
Front Duke SH 1992 284,420 12,923,671 538,486 538,493
Front Duchess SH 1993 284,420 13,345,097 556,046 556,039
Front Ace SH 1993 275,546 13,345,097 556,046 556,039
Xxxxxxxxx XX 0000 302,493 14,117,708 588,238 588,234
Navix Xxxxxx XX 0000 275,644 14,960,556 623,357 623,345
Front Vanguard DH 1998 300,058 40,785,662 726,467 24,076,921
Front Vista DH 1998 300,149 40,785,662 726,467 24,076,921
Xxxxx XX 0000 306,009 42,765,016 711,062 26,410,590
Xxxxxx XX 1999 302,193 42,765,016 711,062 26,410,590
Xxxxx XX 1999 300,144 42,765,016 711,062 26,410,590
Front Comanche DH 1999 300,133 42,765,016 711,062 26,410,590
Oscilla DH 2000 302,193 44,500,000 695,312 28,507,824
Ariake DH 2001 298,530 46,381,850 680,660 30,726,670
Front Serenade DH 2002 299,152 48,019,355 665,618 32,710,141
Otina DH 2002 296,000 48,019,355 665,618 32,710,141
Front Xxxxxxx XX 0000 298,500 48,019,355 665,618 32,710,141
Front Xxxxxx XX 2002 308,000 48,019,355 665,618 32,710,141
Front Page DH 2002 298,500 48,019,355 665,618 32,710,141
--------------------------------------------------------------------------------
1,131,439,219 26,741,280 516,389,779
--------------------------------------------------------------------------------
34 SIGNATORIES
THE BORROWER:
-------------
SHIP FINANCE INTERNATIONAL LIMITED
By: __________________________________
Name:
Title:
THE ORIGINAL LENDERS:
---------------------
DNB NOR BANK ASA
By: __________________________________
Name:
Title:
NORDEA BANK NORGE ASA
By: __________________________________
Name:
Title:
FORTIS BANK (NEDERLAND) N.V.
By: __________________________________
Name:
Title:
CALYON S.A.
By: __________________________________
Name:
Title:
DANISH SHIP FINANCE (DANMARKS SKIBSKREDITFOND)
By: __________________________________
Name:
Title:
DEUTSCHE BANK AG IN HAMBURG/ SCHIFFSHYPOTHEKENBANK ZU LUBECK AG
By: __________________________________
Name:
Title:
DEUTSCHE SCHIFFSBANK AKTIENGESELLSCHAFT
By: __________________________________
Name:
Title:
HSH NORDBANK AG
By: __________________________________
Name:
Title:
ING BANK N.V., LONDON BRANCH
By: __________________________________
Name:
Title:
LLOYDS TSB BANK PLC
By: __________________________________
Name:
Title:
SCOTIABANK EUROPE PLC.
By: __________________________________
Name:
Title:
SKANDINAVISKA ENSKILDA XXXXXX XX (PUBL.)
By: __________________________________
Name:
Title:
SUMITOMO MITSUI BANKING CORPORATION
By: __________________________________
Name:
Title:
SWEDBANK (FORENINGSSPARBANKEN AB (PUBL.))
By: __________________________________
Name:
Title:
BAYERISCHE HYPO- UND VEREINSBANK AG
By: __________________________________
Name:
Title:
THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND
By: __________________________________
Name:
Title:
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
By: __________________________________
Name:
Title:
BNP PARIBAS OSLO BRANCH
By: __________________________________
Name:
Title:
NIB CAPITAL BANK N.V.
By: __________________________________
Name:
Title:
CITIBANK N.A.
By: __________________________________
Name:
Title:
THE SECURITY AGENT AND THE ADMINISTRATIVE AGENT:
------------------------------------------------
DNB NOR BANK ASA
By: __________________________________
Name:
Title:
THE OWNERS:
-----------
For and on behalf of each of:
LANGKAWI SHIPPING LTD.
SIBU SHIPPING LTD.
GRANITE SHIPPING COMPANY LTD.
PUERTO XXXXXXX SHIPPING S.A.
FRONT TUJUH PTE. LTD.
SOUTWEST TANKERS INC.
WEST TANKERS INC.
FOURWAYS MARINE LIMITED
FRONT PRIDE SHIPPING INC.
FRONT SPLENDOUR SHIPPING INC.
FRONT GLORY SHIPPING INC.
FRONT ARDENNE INC.
PATRIO SHIPPING LTD.
BOLZANO PTE. LTD..
FRONT BRABANT INC.
CIREBON SHIPPING PTE. LTD.
FOX MARINE PTE. LTD.
FRONT EMPAT PTE. LTD.
FRONT LIMA XXX.XXX.
FRONT ENAM PTE. LTD.
FRONT TIGA XXX.XXX
SEA ACE CORP.
FRONT DUA PTE. LTD
EDINBURGH NAVIGATION X.X.
XXXXXX BAYSHORE SHIPPING CORPORATION
GOLDEN SOUND CORP.
GOLDEN SEAWAY CORP.
GOLDEN FJORD CORP.
GOLDEN ESTUARY CORP.
GOLDEN CURRENT LIMITED
GOLDEN TIDE CORP.
OSCILLA SHIPPING LIMITED
ARIAKE TRANSPORT CORP.
FRONT STRATUS INC.
FRONT SAGA INC.
FRONT SERENADE INC.
FRONT FALCON CORP.
HITACHI HULL 4983 LTD.
FRONT XXXXX PTE. LTD.
TRANSCORP PTE. LTD.
XXXXXXXX SHIPPING LIMITED
FRONT SEMBILAN PTE. LTD.
KATONG INVESTMENTS LIMITED
ASPINALL PTE. LTD.
RETTIE PTE. LTD.
BLIZANA PTE. LTD.
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