CREDIT FACILITY USD 15.000.000 LOAN AGREEMENT
CREDIT FACILITY
USD
15.000.000
Between
as
Borrower
and
Atlantis
Group hf.
as
Lender
CONTENTS
|
Clause
|
Page
|
|
|
1.
|
DEFINITIONS
AND INTERPRETATION
|
2
|
|
2.
|
THE
FACILITY
|
4
|
|
3.
|
Purpose
|
5
|
|
4.
|
Conditions
of Utilisation
|
5
|
|
5.
|
Utilisation
– (Draw down request)
|
6
|
|
6.
|
Repayment
|
7
|
|
7.
|
Prepayment
|
7
|
|
8.
|
Interest
|
8
|
|
9.
|
Interest
Periods
|
9
|
|
10.
|
TAXES
|
9
|
|
11.
|
Increased
costs
|
10
|
|
12.
|
Other
indemnities
|
10
|
|
13.
|
Mitigation
by the Lender
|
11
|
|
14.
|
Costs
and expenses
|
11
|
|
15.
|
Guarantee
and indemnity
|
11
|
|
16.
|
Representations
AND WARRANTIES
|
12
|
|
17.
|
Information
undertakings
|
13
|
|
18.
|
NEGATIVE
undertakings
|
15
|
|
19.
|
Events
of ▇▇▇▇▇▇▇
|
▇▇
|
|
▇▇.
|
ASSIGNMENTS
AND SUBSTITUTION
|
20
|
|
21.
|
Changes
to the Borrower
|
20
|
|
22.
|
Conduct
of business by the Lender
|
21
|
|
23.
|
Payment
mechanics
|
21
|
|
24.
|
Set-off
|
22
|
|
25.
|
Notices
|
22
|
|
26.
|
Calculations
and certificates
|
23
|
|
27.
|
Partial
invalidity
|
23
|
|
28.
|
Remedies
and waivers
|
23
|
|
29.
|
Counterparts
|
23
|
|
30.
|
Governing
law
|
24
|
|
31.
|
Enforcement
|
24
|
|
SCHEDULE
1
|
26
|
|
|
SCHEDULE
2
|
30
|
|
|
SCHEDULE
3
|
31
|
|
- 1
-
WHERERAS The Lender has agreed
to extend the Borrower a line of credit in the form of this Credit facility in
the maximum amount of USD 15,000,000 under the terms and conditions set forth
herein the Parties agree as follows:
THIS AGREEMENT is effective as
of June 30, 2010 and made between:
|
|
(1)
|
Umami Sustainable Seafood
Inc. (the
“Borrower” or “Umami”);
and
|
|
|
(2)
|
Atlantis Group hf. a
company formed under the laws of the republic of Iceland, registration no.
700805-1580, registered address at ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ (the
"Lender").
|
IT IS AGREED as
follows:
|
1.
|
DEFINITIONS
AND INTERPRETATION
|
|
1.1
|
Definitions
|
In this
Agreement the following words and expressions, except where the context
otherwise requires, shall have the following meaning:
“Acquisition Target“ means the
US and Mexican firm Oceanic Enterprises and Baja Aqua Farms S.A. de C.V.
on which the Lender has for the benefit of the Borrower signed a LOI on terms
and conditions for acquisition.
"AG" means Atlantis Group
hf.
“Available Facility” means USD
15,000,000 minus the amount corresponding to the drawdown of the Facility with
accrued interests and costs.
"Availability Period" means the period from
and including the date of this Agreement to and including December 31st
2010.
"Business Day" means a day on
which banks are open in Reykjavik and in relation to other currencies, the
Relevant Interbank Market.
“Charging Companies” means
Umami, Kali Tuna, Kali Tuna Trogvina, R.O.H.U, MB ▇▇▇▇▇, and other entities submitting security
for this agreement
“Closing” means the signing
date of this Agreement.
"Default" means any Event of
Default or any Potential Event of Default.
"Encumbrance" means any
mortgage pledge, lien, hypothecation, charge, assignment or deposit by way of
security or any other arrangement having the effect of providing or giving
security or preferential ranking to a creditor (including set off, title
retention arrangements which do not arise in the ordinary course of trade,
defeasance or reciprocal fee arrangements).
"Environmental Permits" means
all permits, licenses, consents, approvals, certificates, specifications,
registrations and other authorizations and the filing of all notifications,
reports, improvement programmes and assessments required under any Environmental
Laws for the operation of the business of any of the Group Companies or the
occupation or use of any property in which any Group Company conducts any
activity or otherwise has an interest in.
- 2
-
"Event of Default" means any
event or circumstance specified as such in Clause 19 (Events of
Default).
"Facility" means the term loan
facility in an aggregate amount of USD 15.000.000.00 made available under this
Agreement as described in Clause 2 (The Facility) to the extent
not cancelled, reduced or transferred under this Agreement.
“Facility A” means the term
loan facility made available under this Agreement for up to USD 9,900,000 as
described in paragraph (a) of Clause 2 (The Facility).
.
“Facility A Loan” means a loan
made or to be made under Facility A or the principal amount outstanding for the
time being of that loan.
“Facility B” means the term loan
facility made available under this Agreement for up to USD 5,100,000 as
described in paragraph (b) of Clause 2 (The Facility) the utilization of
Facility B being subject to acquisition of the Acquisition Target
.
“Facility B Loan” means a loan made or to
be made under Facility B or the principal amount outstanding for the time being
of that loan.
"Final Repayment Date" means
December 31st
2010
"Finance Documents" means this
Agreement and the Security Documents and any other document so designated by the
Lender and the Borrower.
"Group" means the Borrower and
each of its subsidiaries (and the subsidiaries of such subsidiaries), whether
wholly or partly owned and "Group Company" means any of them.
"Interest Payment Date" means
in relation to amounts borrowed under this Agreement, the last day of each
Interest Period.
"Interest Period" means, in
relation to a Loan, each period determined in accordance with Clause 9
(Interest Periods) and,
in relation to an Unpaid Sum, each period determined in accordance with
Clause 8.3 (Default
interest).
"Loan" means a loan made or to
be made under the Facility or the principal amount outstanding for the time
being of that loan.
“Material Adverse Effect” means
an event or circumstance which (when taken alone or together with any previous
event or circumstance) is or could be expected in the reasonable opinion of the
Lender to be materially adverse to the assets, business, trading prospects or
financial or trading position or condition of the Group take as a
whole.
"Material Contracts" means, at
any time, any agreement to which a Group Company is a party which is of such
importance to any member of the Group that the loss of the benefit of that
agreement for the Group taking into account commercial circumstances prevailing
at that time and taking into account any available alternatives or replacements
would have or be reasonably likely to have a Material Adverse
Effect.
"Note" means the debenture in
the Form of Schedule [3] (Form of Note).
"Obligor" means a
Borrower
- 3
-
"Party" means a party to this
Agreement.
"Parent" means the Borrower as
defined in the preamble of this Agreement.
"Potential Event of Default"
means anything which, with the giving of notice, the lapse of time, any
determination of materiality, the satisfaction of any applicable condition, or
any combination of them is likely, in the reasonable opinion of the Lender, to
be in accordance with Clause 19 (Events of Default), an Event
of Default.
"Reference Banks" means
Kaupthing banki hf., and Landsbanki hf. or such other banks as may be appointed
by the Lender in consultation with the Borrower.
"Security Documents" means the
security documents granted to the Lender as to grant him security for repayment
of the loan granted under the Credit Facility Agreement.
"Tax" means any tax, levy,
impost, duty or other charge or withholding of a similar nature (including a
penalty or interest payable in connection with any failure to pay or delay in
paying any of the same) and “Taxes” shall be construed
accordingly.
"Unpaid Sum" means any sum due
and payable but unpaid by an Obligor under this Agreement.
"Utilisation" means an
utilisation of the Facility.
"Utilisation Date" means the
date of an Utilisation, being the date on which the relevant Loan is to be
made.
"Utilisation Request" means a
notice substantially in the form set out in Schedule 2 (Utilisation Requests). – Also
referred to as “drawdown request”
|
1.2
|
Construction
|
|
|
(a)
|
A
provision of law is a reference to that provision as amended or
re-enacted;
|
|
|
(b)
|
A
clause on a Schedule is a reference to a clause or a schedule to this
Agreement unless expressly set forth
otherwise;
|
|
|
(c)
|
A
reference to a person or entity includes its permitted successors,
transferees and assigns;
|
|
|
(d)
|
Words
importing the singular shall include the plural and vice
versa.
|
|
2.
|
THE
FACILITY
|
Subject
to the terms of this Agreement, the Lender makes available to the Borrower an
USD term loan facility in an aggregate amount of USD 15.000.000.00.
Drawdown on this facility is subject to terms defined in this
Agreement. The Facility is split up in two sub facilities;
|
|
(a)
|
a
loan facility in the aggregate amount of USD 9,900,000, nine million
and nine hundred USD (the "Term A Loan Facility"
and
|
a term
loan facility in the aggregate amount of up to USD 5,100,000, five million and
one hundred thousand USD(the "Term B Loan
Facility"),.
- 4
-
|
3.
|
PURPOSE
|
The
amounts borrowed under this Agreement shall be applied to satisfy the Borrowers
needs for funds to finance operations of any Group Company as regards loan
granted under Term A Loan Facility and to finance the Borrowers acquisition of
1/3 of the shares of the Target Company as regards loans granted under Term B
Loan Facility.
|
4.
|
CONDITIONS
OF UTILISATION
|
|
4.1
|
Initial
conditions precedent
|
|
|
a)
|
The
Borrower acknowledges that this Credit Facility is extended to him by the
Lender on the basis of current relations between the parties, i.e. that
the Lender is holding more than 50% of the shares of the Borrower and is
further handling the sale of his products according to a separate
Agreement thereof.
|
|
|
b)
|
It
is understood by the parties that the Borrower is to seek a full financing
of his operation and investments with other means than by a line of credit
extended by Lender.
|
|
|
c)
|
The
Borrower may not deliver an Utilisation Request unless the Lender has
received or waived its right to
receive
|
|
(i)
|
Security
in the form of pledge of biomass, shares in the Borrowers subsidiaries or
of fixed
assets, all subject to acceptance by the
Lender.
|
|
|
(ii)
|
Weekly
cash flow or monthly statement for the Borrower for all of his Tuna
farming operations.
|
|
|
(iii)
|
Monthly
estimate of inventory
|
|
(iv)
|
Update
on new debts or encumbrances of the Borrower in the aggregated sum of
USD one
million, entered into after the date of signing of this
Agreement.
|
|
4.2
|
Further
conditions precedent
|
The
Lender will only be obliged to make a Loan available to the Borrower if on the
date of the Utilisation Request and on the proposed Utilisation
Date:
|
|
(a)
|
each
representation in Clause 16 (Representations and
Warranties) is true and accurate or has been waived by the Lender;
and
|
|
|
(b)
|
no
Default is Continuing or would result from the proposed
Loan.
|
|
4.3
|
Conditions
Subsequent
|
|
|
(a)
|
If
any of the condition precedent items referred to in Art. 4.1.c are
expressly waived by the Lender, such conditions shall become conditions
subsequent under this clause 4.3 and the Borrower will within 2 months
deliver to the Lender in form and substance satisfactory to the Lender
such documents.
|
|
4.4.
|
Lenders
Acknowledgement.
|
The
Lender confirms that it has received a cash flow statement from the Lender
showing the need for 7.3 million USD financing for the current operation and 7.7
million USD to facilitate the intended acquisition of the Target
Companies. The Lender is also fully informed on all financial issues
regarding the current operation at Kali Tuna. He is therefore until
further notice not calling for any additional information under Clause 4.1
as a condition for utilization acceptance of utilization requests. The
Borrower grants the Lender full access to all financial information the Lender
may require and commits itself to maintain the same processes on accounting and
reporting as of now in Kali Tuna.
- 5
-
|
5.
|
UTILISATION
– (DRAW DOWN REQUEST)
|
|
5.1
|
Delivery
and process of an Utilisation
Request
|
|
|
(a)
|
The
Borrower may utilise the Facility by delivery to the Lender of a duly
completed Utilisation Request in the format provided for as Schedule
3. Such request shall be submitted to the Lender no less than 10
banking days prior to the requested payout
date.
|
|
|
(b)
|
The
Lender retains his undisputable right to decide whether he regards the
conditions for a utilisation request is met and is not to be held liable
in any way, should he decide to decline such an
request.
|
|
|
(c)
|
In
case the Lender declines to facilitate a utilisation request, he shall
give a notice thereof to the Borrower no later than 24 hours prior to the
requested date of execution.
|
|
5.2
|
Completion
of an Utilisation Request
|
|
|
(a)
|
The
Utilisation Request is irrevocable and will not be regarded as having been
duly completed unless:
|
|
|
(i)
|
the
proposed Utilisation Date is a Business Day within the Availability
Period;
|
|
|
(ii)
|
the
currency and amount of the Utilisation comply with Clause 5.3 (Currency and amount);
and
|
|
|
(iii)
|
the
proposed Interest Period complies with Clause 9 (Interest
Periods).
|
|
|
(iv)
|
unless
the payment instruction is given to a bank account held by the
Lender.
|
|
5.3
|
Currency
and amount
|
|
|
(a)
|
The
currency specified in a Utilisation Request must be
USD.
|
|
|
(b)
|
The
amount of the proposed Loan must be an amount which is not more than the
Available Facility.
|
|
5.4
|
Note
|
The
Borrower acknowledges that:
|
|
(a)
|
the
Note is intended to evidence its indebtedness under this
Agreement;
|
|
|
(b)
|
the
Note is issued subject to the terms of this Agreement which will in all
circumstances override any provision of the Note which is inconsistent
with any provision of this Agreement (as the case may
be);
|
|
|
(c)
|
all
payments under this Agreement (whether of principal, interest or
otherwise) will be taken to be payments under the
Note;
|
|
|
(d)
|
the
Note signed by the Borrower shall be deemed to have been issued by and on
behalf of the Borrower from time to
time;
|
|
|
(e)
|
upon
the making of the first Loan to the Borrower under this Agreement, the
Lender shall be entitled to the Note in accordance with this
Agreement.
|
Upon
payment in full of all amounts outstanding under the Facilities and those
Facilities having been cancelled in full the Lender shall promptly return the
Note to the Borrower.
- 6
-
|
5.5
|
Utilisation
Request
|
|
|
(a)
|
The
first Utilisation Request by the Borrower shall be accompanied by a Note
corresponding to the initial amount of Loan requested under facility
A. If the Borrower fails to complete the Note then it irrevocably
authorises the Lender to complete and sign a Note in the appropriate
amount on its behalf.
|
|
|
(b)
|
If,
for any reason, a Utilisation is not made following the receipt by the
Lender of a Utilisation Request, the Lender shall return the Note to the
Borrower as soon as reasonably
practicable.
|
|
|
(c)
|
Notes
for additional draw downs shall be issued pursuant Clause 5.4. Note
corresponding to loan granted under Facility B shall be issued on the date
of signing of the Debt Assumption Agreement to be entered into on as a
integrated part of the Borrower’s Acquisition of Target
Company
|
|
6.
|
REPAYMENT
|
|
6.1
|
Repayment
of Loans
|
|
|
(a)
|
This
Loan Facility Agreement is valid until December 31st
2010 which is the final repayment
day.
|
|
|
(b)
|
The
Borrower commits himself to utilise any cash that it will raise after the
signing of this agreement, may it be by borrowing or from the proceeds
from sale of shares of the Borrower under the terms of the offering, to
pay the outstanding debt under this Credit facility to the
Lender.
|
|
|
(c)
|
For
the avoidance of doubt, any amounts then outstanding under the terms of
this Agreement shall be repaid on the Final Repayment
Date.
|
|
6.2
|
Re-borrowing
|
The
Lender retains the right up on his sole discretion at the request of the
Borrower to extent the validity of this Credit Facility Loan Agreement and to
extend credit to the Borrower under the terms of such an extended
Agreement.
|
7.
|
PREPAYMENT
|
|
7.1
|
Illegality
|
If it
becomes unlawful in any relevant jurisdiction for the Lender to perform any of
its obligations as contemplated by this Agreement or to fund or maintain any
Loan:
|
|
(a)
|
the
Lender shall promptly notify the Borrower upon becoming aware of that
event whereupon the Facility will be immediately cancelled;
and
|
|
|
(b)
|
the
Borrower shall repay the Loans on the last day of the Interest Period for
each Loan occurring after the Lender has notified the Borrower or, if
earlier, the date specified by the Lender in the notice delivered to the
Borrower (being no earlier than the last day of any applicable grace
period permitted by law) together with accrued interest to the date of
actual payment and all other sums due to
it.
|
|
7.2
|
Change
of control – asset sale - listing
|
|
|
(a)
|
If
any person or group of persons acting in concert gains control over the
Borrower or if all or any material part of the business or assets of a
Group company are disposed of in a trade
sale;
|
|
|
(i)
|
the
Borrower shall promptly notify the Lender upon becoming aware of that
event;
|
- 7
-
|
|
(ii)
|
the
Lender shall not be obliged to fund an Utilisation;
and
|
|
|
(iii)
|
the
Lender may, by not less than 2 days prior notice to the Borrower, cancel
the Facility and declare all outstanding Loans, together with accrued
interest, immediately due and payable, whereupon the Facility will be
cancelled and all such outstanding amounts will become immediately due and
payable.
|
|
|
(b)
|
For
the purpose of sub-clause (a) above "control"
means:
|
|
|
(i)
|
the
power (whether by way of ownership of shares, proxy, contract, agency or
otherwise) to:
|
|
|
1.
|
cast,
or control the casting of, more than one-half of the maximum number of
votes that might be cast at a general meeting of a Group Company;
or
|
|
|
2.
|
appoint
or remove all, or the majority, of the directors or other equivalent
officers of a Group Company; or
|
|
|
3.
|
give
directions with respect to the operating and financial policies of the
Group Company, which the directors or other equivalent officers of a Group
Company are obliged to comply with;
or
|
|
|
(ii)
|
the
holding of more than one-half of the issued share capital of a Group
Company (excluding any part of that issued share capital that carries no
right to participate beyond a specified amount in a distribution of either
profits or capital).
|
|
|
(iii)
|
For
the purpose of sub-clause (a) above "acting in concert"
means, a group of persons who, pursuant to an agreement or understanding
(whether formal or informal), actively co-operate, through the acquisition
by any of them, either directly or indirectly, of shares in a Group
Company, to obtain or consolidate control of a Group
Company.
|
|
7.3
|
Voluntary
prepayment of Loans
|
|
|
(a)
|
The
Borrower may prepay all or only part of the Loan on any Business Day
if:
|
|
|
(i)
|
it
has given to the Lender not less than 2 Business Days' irrevocable notice
of the date of the prepayment;
and
|
|
|
(ii)
|
it
pays the Break Costs and all appropriate breakage cost under Clause 12.1
(Miscellaneous
indemnities); and
|
|
|
(iii)
|
the
amount prepaid is at least USD 50,000 and, if greater, an integral
multiple of USD 50,000.
|
|
|
(b)
|
Any
prepayment shall be made with accrued interest on the amount prepaid and
any other sums then due and payable to the Lender under this
Agreement.
|
|
|
(c)
|
A
notice of prepayment once given is irrevocable and the Borrower shall be
bound, to the extent this Agreement permits, to prepay in accordance with
that notice.
|
|
7.4
|
Restrictions
|
The
Borrower may not repay or prepay all or part of a Loan except as provided in
this Agreement.
|
8.
|
INTEREST
|
|
8.1
|
Calculation
of interest
|
The rate
of interest on each Loan for each Interest Period is 1% pr.
month.
- 8
-
|
8.2
|
Payment
of interest
|
The
Borrower shall accrued interest on each Loan under this Agreement and under the
Note on each Interest Payment Date. The Borrower may elect to fund the
interest by borrowing against the line of credit if there are remaining amounts
left to borrow under the note, up to the amount remaining. For the
avoidance of doubt, interest and default interest shall only be payable once,
and any payment shall be deemed to be under the Note and such payment shall also
discharge such corresponding obligation under this Agreement, provided that if
interest and default interest is not capable of being paid under the Note, such
obligation shall remain and subsist under this Agreement.
|
8.3
|
Default
interest
|
In the
event an Obligor fails to pay any principal, interest or any other amount due
and payable hereunder, the Obligor shall pay interest (“Default Interest”) on such
amount from the due date until payment is received by the Lender at the rate of
5% (five per cent) per annum above the interest rate in accordance with clause
8.1. The Default Interest will be compounded at the end of a funding period the
length of which will be determined by the Lender at its sole discretion.
For the avoidance of doubt, interest and default interest shall only be payable
once, and any payment shall be deemed to be under the Note and such payment
shall also discharge such corresponding obligation under this Agreement,
provided that if interest and default interest is not capable of being paid
under the Note, such obligation shall remain and subsist under this
Agreement.
|
9.
|
INTEREST
PERIODS
|
|
9.1
|
Interest
Periods
|
|
|
(a)
|
Each
Interest Period (except the first one) shall be of one month
duration.
|
|
|
(b)
|
The
first Interest Period shall commence on the date the Utilization
Date Loan and end on the last day of each
month.
|
|
9.2
|
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).
|
10.
|
TAXES
|
All
payments to be made by the Borrower hereunder shall be made:
|
|
(a)
|
without
set-off or counterclaim; and
|
|
|
(b)
|
free
and clear of and without deduction for or on account of any taxes unless
the Borrower are compelled by law to make payment subject to such
taxes.
|
All taxes
in respect of this Agreement shall be paid by the Borrower when due and in any
event prior to the date on which penalties attach thereto and the Borrower will
forward to the Lender official tax receipts evidencing payment of such taxes
within 30 days of payment being due for such. The Borrower will indemnify the
Lender in respect of all such Taxes.
In
addition, if any taxes or amounts in respect thereof must be deducted from any
amounts payable or paid by the Borrower hereunder, the Borrower shall pay such
additional amounts as may be necessary to ensure that the Lender receives a net
amount equal to the full amount which it would have received on the due date had
payment not been made subject to such taxes.
- 9
-
|
11.
|
INCREASED
COSTS
|
|
11.1
|
Increased
Costs
|
|
|
(a)
|
Subject
to Clause 11.3(Exceptions), the
Borrower shall within three Business Days of a demand by the Lender, pay
the Lender the amount of any reasonable increased cost incurred by it or
any of its affiliated entities as a result
of:
|
|
|
(i)
|
the
introduction of or any change in (or in the interpretation or application
of) any law or regulation with which it is customary for, or expected of,
banks generally (operating in the Relevant Interbank Market) to comply;
or
|
|
|
(ii)
|
compliance
with any law or regulation made after the date of this
Agreement;
|
and which is generally borne by other
borrowers of the Lender.
|
11.2
|
Increased
Cost claims
|
If the
Lender intends to make a claim pursuant to Clause 11.1 (Increased costs), the Lender
shall promptly notify the Borrowers.
|
11.3
|
Exceptions
|
Clause
1.1.1 (Increased costs)
does not apply to the extent any Increased Cost is attributable to the wilful
breach (or grossly negligent failure to comply) by the Lender of (or with) any
law or regulation.
|
12.
|
OTHER
INDEMNITIES
|
|
12.1
|
Miscellaneous
indemnities
|
|
|
(a)
|
The
Borrower shall indemnify on demand the Lender against any funding or other
costs, loss, expense or liability sustained by the Lender (including on
its termination of any hedging instrument) as a consequence
of: (a) the occurrence or continuance of any Default or (b) its
taking any steps under Clause 13.1 (Mitigation).
|
|
|
(b)
|
The
Borrower shall promptly indemnify the Lender against any cost, loss or
liability incurred by them as a result
of:
|
|
|
(i)
|
its
investigating any event which it reasonably believes to be a Default;
or
|
|
|
(ii)
|
acting
or relying on any notice which it believes to be genuine, correct and
authorised.
|
|
|
(iii)
|
decline
of a Utilisation request.
|
|
|
(iv)
|
decline
of a request to extend the validity of the Credit Facility Loan Agreement
cc. Clause 6.2
|
- 10
-
|
12.2
|
Financing
Indemnity
|
The
Borrower shall, within 15 Business Days of demand, indemnify the Lender, each of
its affiliated entities and each of its directors, officers, employees or agents
(each an "Indemnified
Party") against any cost, expense, loss or liability (including legal
fees) incurred by that Indemnified Party (otherwise than by reason of the gross
negligence or wilful misconduct of that Indemnified Party) related to, arising
out of or in connection with any actual or potential legal action or proceeding
arising out of or in connection with the use of proceeds of any
Loan.
|
13.
|
MITIGATION
BY THE LENDER
|
|
13.1
|
Mitigation
|
The
Lender shall (in consultation with the Borrower) take all reasonable steps to
mitigate any circumstances which arise and which would result in any amount
becoming payable under, or cancelled pursuant to any of Clause 7.1 (Illegality) or Clause
10(Taxes). The Lender
is under no obligation to take any steps, if it considers, in its absolute
discretion, that to do so might be prejudicial to it. This Clause does not in
any way limit the obligations of the Borrower under this Agreement.
|
13.2
|
Limitation
of liability
|
The
Lender is not obliged to take any steps under Clause 13.1 (Mitigation) if, in the
opinion of the Lender (acting reasonably), to do so might be prejudicial to
it.
|
14.
|
COSTS
AND EXPENSES
|
|
14.1
|
Transaction
expenses
|
The
Borrower shall reimburse the Lender promptly on demand (on a full indemnity
basis and whether or not the Facility is utilised) for all reasonable costs and
expenses in any relevant jurisdiction (including legal, valuation, accountancy,
and consulting fees and communication and out-of-pocket expenses) and any VAT or
similar Tax thereon incurred by the Lender in connection with the negotiation,
preparation, printing, execution and syndication of:
|
|
-
|
this
Agreement and any other document referred to in this Agreement;
and
|
|
|
-
|
any
other Finance Document executed after the date of this
Agreement.
|
|
14.2
|
Enforcement
Costs
|
The
Borrower shall, within 20 Business Days of demand, pay to the Lender the amount
of all costs and expenses (including legal, valuation, accountancy and
consulting fees and commission and out-of-pocket expenses) and any VAT thereon
incurred by the Lender in connection with the enforcement of, or the
preservation of its rights under this Agreement or any of the documents referred
to therein in any jurisdiction.
|
15.
|
GUARANTEE
AND INDEMNITY
|
|
15.1
|
Guarantee
and indemnity
|
Save as
described in Clause 13.2 (Limitation of Liability), the
Borrower irrevocably and unconditionally:
|
|
(a)
|
guarantees
to the Lender punctual performance by the Borrower of all the Borrower's
obligations under the Finance
Documents;
|
|
|
(b)
|
indemnifies
the Lender immediately on demand against any cost, loss or liability
suffered by the Lender 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 the Lender would otherwise
have been entitled to recover.
|
- 11
-
|
15.2
|
Appropriations
|
Until all
amounts which may be or become payable by the Borrower under or in connection
with the Finance Documents have been irrevocably paid in full, the Lender (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 the Lender (or any trustee or agent on its behalf) in respect
of those amounts, or apply and enforce the same in such manner and order
as it sees fit (whether against those amounts or
otherwise).
|
|
16.
|
REPRESENTATIONS
AND WARRANTIES
|
|
16.1
|
Representations
and Warranties
|
The Borrower
for itself and each the Group Companies that on the date of this Agreement and
on the dates and to the extent specified in Clause 16.2(Repetition)
that:
|
|
(a)
|
Status: (in case of the
Borrower) each Group Company is a US Corporation or a limited liability
company duly incorporated, validly existing and registered under the
applicable laws in its jurisdiction and has the power and all necessary
governmental and other material consents, approvals, licences and
authorities in any applicable jurisdiction to own its assets and carry on
its business as it is being
conducted;
|
|
(b)
|
Powers and authority: it
has the power to enter into and perform the Finance Documents and the
transaction contemplated hereby and has taken all necessary action to
authorize the entry into and performance of the Finance Documents and the
transaction contemplated hereby;
|
|
|
(c)
|
Obligation Binding: the
Finance Documents constitute a legal, valid and binding obligation of it
enforceable in accordance with its terms. The Finance Documents are in
proper form to make it admissible in evidence for bringing an action on
the same in such courts. Without limiting the generality of the above,
each Security Document to which it is a party to creates the security
which the Security Document purports to create and those security
interests are valid effective;
|
|
|
(d)
|
Non-conflict with
laws:
The entry into and performance of the Finance Documents and the
transactions contemplated hereby do not and will not conflict with (i) any
law or regulation or any official or judicial order or treaty in any
relevant jurisdiction or (ii) any agreement or document to which the
Borrower are party to or which is binding upon or any of its assets, nor
result in the creation or imposition of any Encumbrance on any of its
assets pursuant to the provisions of any such agreement or
document;
|
|
|
(e)
|
No Default: No Default has
occurred which might have a material adverse change on its business or
financial condition;
|
|
|
(f)
|
Consents: All
authorizations, approvals, consents, licenses, exemptions, filings,
registrations, notarizations and other matters, official or otherwise,
required or advisable in connection with the entry into performance,
validity and enforceability of the Finance Documents and the transactions
contemplated hereby have been obtained or effected and are in full force
and effect;
|
- 12
-
|
|
(g)
|
No filings
required: It is not necessary to ensure the legality,
validity, enforceability or admissibility in evidence of the Finance
Documents that it be filed, recorded or enrolled with any governmental
authority or agency in Iceland, USA or Croatia or that any stamp,
registration or similar tax be paid on or in relation to this Agreement in
Iceland, USA or Croatia;
|
|
|
(h)
|
Pari Passu Ranking:
Under the laws of Iceland in force at the date hereof, the claims
of the Lender under this Loan will rank at least pari passu with the
claims of all its unsecured creditors to the extend it may not be covered
with a security provided herein;
|
|
|
(i)
|
Full Disclosure: All
information supplied by the Borrower in connection with this Loan is true,
complete and accurate and it is not aware of any facts or circumstances
that have not been disclosed to the Lender and which might, if disclosed,
adversely affect the decision of a person considering whether or not to
provide finance to the Borrower;
|
|
|
(j)
|
No
Event of Default is Continuing or is reasonably likely to result from the
execution of, or the performance of any transaction contemplated by the
Finance Documents;
|
|
|
(k)
|
in
respect of those Finance Documents subject to the law in respect of a
particular jurisdiction (other than Icelandic law), the choice of that law
as the governing law of those Finance Documents will be recognised and
enforced in the relevant jurisdiction of those Finance Documents and any
judgment obtained in the jurisdiction of such law will be recognised and
enforced in the relevant jurisdiction of those Finance
Documents;
|
|
|
(l)
|
notwithstanding
the foregoing, in respect of those Finance Documents expressed to be
governed by Icelandic law the choice of Icelandic law as the governing law
of those Finance Documents will be recognised and enforced in all relevant
jurisdictions and any judgment obtained in relation to a Finance Document
subject to Icelandic law will be recognised and enforced in all relevant
jurisdictions;
|
|
16.2
|
Repetition
|
On the
date on which a Loan is requested, on the Utilisation Date and on the first day
of each Interest Period the Borrower shall be deemed to repeat each
representation and warranty in Clause 17 and 18 (Information Undertakings
and Negative undertakings)
|
17.
|
INFORMATION
UNDERTAKINGS
|
The
Borrower shall and shall procure that each other Group Company shall, except
with the Lender's prior consent:
|
|
(a)
|
Borrowers information. The Lender
is fully knowledgeable of all current processes at Kali Tuna and is
satisfied with the level and quality of information he has been receiving
thereof. He does not request any additional processes to be put
in place at Kali Tuna but retains his right to have the same information
thereof updated in line with the current schedule. Other
paragraphs of this Clause 17 shall in the case of Kali Tuna be construed
in coherence to this acceptance of current
procedures.
|
- 13
-
|
|
(b)
|
General: Furnish the
Lender with a copy from time to time with reasonable promptness of such
financial and other information as to itself as the Lender may reasonably
request.
|
|
|
(c)
|
Budget: Deliver to the
Lender up on request and then not later than 30 days before the start of
each financial year of the Lender, an itemized consolidated budget for the
Group as a whole for the next financial year in the format approved by the
Lender containing :
|
|
|
(i)
|
capital
expenditure;
|
|
|
(ii)
|
trading
and revenue forecast prepared on a month by month
basis;
|
|
|
(iii)
|
proposed
disposals where the forecast consideration exceeds on a month by month
basis;
|
|
|
(iv)
|
a
statement on revenue and cash flow and a balance sheet as it is forecasted
to be at the end of the financial
year;
|
|
|
(v)
|
the
principal assumptions underlying the budget;
and
|
such
budget to have been approved by the directors of the Borrower, to include for
each Month consolidated statements of forecast profit and loss; together with a
commentary on the above and to contain such other information as is necessary in
the reasonable opinion of the Lender.
|
|
(d)
|
Accounts: Deliver to the
Lender up on request
|
|
|
(i)
|
audited
annual accounts within one month of the same being prepared and in any
event not later than 90 days after the end of the period to which such
statements relate. Such accounts shall provide explanations of any
material changes against the budget supplied under clause 20 (b) for that
financial year; and
|
|
|
(ii)
|
management
accounts of the Group for each month and cumulative management accounts of
the Group for each month from the beginning of each financial year
accounts within 14 days after the end of the period to which such
statements relate.
|
|
|
(iii)
|
consolidated
quarterly financial statements for the Group for the period ending every
three months, within 45 days after the end of the period to which such
statements relate, in a form consistent with the management accounts and
also to include:
|
Such
accounts shall be prepared in accordance with generally accepted accounting
principles in the jurisdiction where the relevant entity is incorporated and be
approved by the directors (and the board where relevant) of each Group
Company.
|
|
(e)
|
Other
information. Such other information concerning the business or
financial condition of the Group (or any part of it), including but not
limited to information of any litigation or administrative proceedings
current, pending or threatened against any Group Company, any Default, any
changes or proposed or possible changes in the markets in which the Group
operates which may have material effect on its
business.
|
- 14
-
|
|
(f)
|
"Know your customer"
checks: If:
|
|
|
(i)
|
the
introduction of or any change in (or in the interpretation, administration
or application of) any law or regulation made after the date of this
Agreement;
|
|
|
(ii)
|
any
change in the status of an Obligor or the composition of the shareholders
of an Obligor after the date of this Agreement;
or
|
|
|
(iii)
|
a
proposed assignment by the Lender of any of its rights under this
Agreement, obliges the Lender to comply with "know your customer" or
similar identification procedures in circumstances where the necessary
information is not already available to it, each Obligor shall promptly
upon the request of the Lender supply, or procure the supply of, such
documentation and other evidence as is reasonably requested by the Lender
(for itself or, in the case of the event described in paragraph (iii)
above, on behalf of any prospective new Lender) in order for the Lender
or, in the case of the event described in paragraph (iii) above, any
prospective new Lender to carry out and be satisfied it has complied with
all necessary "know your customer" or other similar checks under all
applicable laws and regulations pursuant to the transactions contemplated
in this Agreement.
|
|
18.
|
NEGATIVE
UNDERTAKINGS
|
The
Borrower shall and the Borrower shall procure that each Group Company
shall:
|
|
(a)
|
Authorisations: Promptly
obtain, maintain and comply with the terms of any authorization required
under any law or regulation to enable it to perform its obligations under,
or for the validity, enforceability or admissibility in evidence of the
Finance Documents;
|
|
|
(b)
|
Security:
|
|
|
(i)
|
take
whatever steps and execute whatever documents the Lender may reasonably
require in order to give effect to the Security
Documents;
|
|
|
(ii)
|
grant
such further security in favour of the Lender as may be required by the
Lender at any time, and which the relevant Group Company can legally
grant, from time to time and all such further security will secure the
obligations of each Group Company under the Finance Documents;
and
|
|
|
(iii)
|
take
all actions necessary to, in every sense maintain, preserve, protect and
defend the security interest granted under the Security Documents so long
as the security is not already being used for some other
obligation;
|
|
|
(c)
|
Ranking of Liabilities:
Ensure that its liabilities under the Finance Documents will
constitute its direct and unconditional obligations and rank in priority
to all its other present and future indebtedness (except for indebtedness
ranking equally or entitled to priority by operation of
law
|
|
|
(d)
|
Insurance
|
|
|
(i)
|
Maintain
at all times, with insurance companies of good financial standing
acceptable to the Lender acting reasonably, such policies of insurance in
relation to its business and assets against such risks as are normally
insured by prudent companies carrying on similar business and against such
other risks as the Lender may from time to time require (including cover
for public, product, environmental, terrorism and third party liability),
to the full replacement value of such assets for the time being on the
basis of a declared value with a reasonable inflation
provision;
|
- 15
-
|
|
(ii)
|
Comply
with the terms of all insurance policies, including any stipulations or
restrictions as to use or operation of any asset, and for the avoidance of
doubt, observe every safety regulation as recorded and set out in the
policies and/or schedules relating thereto, and shall not do or permit
anything which may make any insurance policy void or
voidable;
|
|
|
(iii)
|
If
any default shall at any time be made by any Group Company in effecting or
maintaining such insurance or in producing any such evidence to the Lender
promptly or depositing any policy with the Lender, the Lender may take out
or renew such insurances in such sums as the Lender may think expedient
and all money expended by the Lender under this provision shall be
recoverable by the Lender under the this
Agreement;
|
|
|
(iv)
|
Procure
that the Group Companies shall, if so required by the Lender, use their
reasonable endeavours to cause the policies of insurance maintained by
them as required by this clause to be forthwith amended to include clauses
in form satisfactory to the Lender to ensure that the policies shall not
be voidable by the insurers as a result of any misrepresentation,
non-disclosure of material facts or breach of warranty provided that in
each case there shall have been no fraud or willful deceit on the part of
the insured Group Company;
|
|
|
(e)
|
Maintenance of licences:
Protect and maintain (and take no action which could foreseeably imperil
the continuation of) the licences and statutory authorisations, consents,
approvals, intellectual property, trade names, franchises and contracts
(the "Authorisations") which are material and necessary
for the conduct and continuation of its business substantially as
presently conducted and procure that all material conditions attaching to
the Authorisations are complied with and that the Group's business is
carried on within the terms of the
Authorisations;
|
|
|
(f)
|
Access: On at least two
day's notice being given to the Borrower by the Lender (except in the case
of emergency), permit representatives of the Lenders or its advisers to
have access to and inspect the property, assets, books and records of any
Group Company during normal business hours at the risk and the cost of
that Group Company;
|
|
|
(g)
|
Environmental Matters:
Comply with all Environmental Laws and obtain, maintain and comply with
any Environmental Permit where, in either case, failure to do so is to
result in liability and/or costs in excess of two hundred and fifty
thousand USD 250,000 or in the closure of any site or suspension of any of
its operations or business;
|
|
|
(h)
|
Compliance with laws:
Comply in all respects with all laws and regulations to which it is
subject, non-compliance with which would have a Material Adverse
Effect;
|
|
|
(i)
|
Taxes: Pay all Taxes due
and payable by it within applicable time limits without incurring
penalties;
|
- 16
-
|
|
(j)
|
Intellectual Property
|
|
|
(i)
|
preserve
and maintain the subsistence and validity of its intellectual property
necessary for the business of the relevant Group
member;
|
|
|
(ii)
|
use
reasonable endeavours to prevent any infringement in any material respect
of its intellectual property;
|
|
|
(iii)
|
make
registrations and pay all registration fees and taxes necessary to
maintain its intellectual property in full force and effect and record its
interest in that intellectual
property;
|
|
|
(iv)
|
not
use or permit its intellectual property to be used in a way or take any
step or omit to take any step in respect of that intellectual property
which may materially and adversely affect the existence or value of the
intellectual property or imperil the right of any member of the group to
use such property; and
|
|
|
(v)
|
not
discontinue the use of any of its intellectual
property;
|
where
failure to do so is reasonably likely to have a Material Adverse
Effect.
|
|
(k)
|
Pensions
|
|
|
(i)
|
ensure
that all pension schemes operated by or maintained for the benefit of the
Group Companies and/or its employees are fully funded and that no action
or omission is taken by any Group Company in relation to such a pension
scheme which has or is reasonably likely to have materially adverse
affect.
|
|
|
(ii)
|
the
Parent shall ensure that no Group Company establishes any defined benefit
occupational pension scheme.
|
|
|
(iii)
|
The
Parent shall deliver to the Lender at such times as those reports are
prepared in order to comply with the then current statutory or auditing
requirements (as applicable either to the trustees of any relevant schemes
or to a Parent), actuarial reports in relation to all pension scheme
mentioned in (a) above;
|
|
|
(l)
|
Senior Management Service
contracts: ensure that the senior management of each Group Company
continues to be employed for that Group Company and agreements with such
parties are not terminated without the Lender’s
consent.
|
|
|
(m)
|
Default – Litigation:
promptly, upon becoming aware of the same, notify the Lender of
:
|
|
|
(i)
|
any
Default;
|
|
|
(ii)
|
any
litigation, arbitration or administration proceeding commenced against any
member of the Group; which if adversely determined involves a potential
liability of any member of the Group exceeding USD [50,000] (fifty
thousand US dollars;
|
|
|
(iii)
|
any
Encumbrance attaching to any of the assets of any member of the Group,
which has not been declared in budget or by other
means;
|
|
|
(n)
|
Status: remain US
corporations or limited liability corporations, duly incorporated and
validly existing under the laws of its jurisdiction of incorporation and
to maintain its power to ▇▇▇, to own its assets and carry on its business
as it is being conducted;
|
|
|
(o)
|
Material Contracts:
comply at all times with all Material
Contracts;
|
- 17
-
|
|
(p)
|
Preservation of assets:
maintain in good working order and condition (ordinary wear and tear
excepted) all of its assets necessary or desirable in the conduct of its
business;
|
|
|
(q)
|
No discontiniouation of current
processes: The Borrower accepts to maintain all current
processes at Kali Tuna in regard of Budgeting, financial planning and
preparation and delivery of any information on the finances or the
operation of the Company.
|
|
19.
|
EVENTS
OF DEFAULT
|
|
19.1
|
Events
of default
|
Each of
the events set out below is an Event of Default, whether or not caused by any
reason whatsoever outside the control of the Borrower or of any other person or
legal entity, as long as the Lender is not causing the default of the
Borrower:
|
|
(a)
|
Non-payment: Failure by a
Borrower to pay promptly and for value on the due date any sum whatsoever
due for payment by a Borrower to the Lender under the Finance Documents
provided the failure shall only constitute an Event of Default if such
failure to pay continue unremedied for 3 (three) Business Days after a
notice thereof has been given by the Lender to a Borrower;
or
|
|
|
(b)
|
Breach of certain
obligations: If the Borrower
fails to comply with any of its obligations according to the Finance
Documents and such breach if capable of remedy continues unremedied for 5
(five) Business Days after receipt of a notice thereof from the Lender;
or
|
|
|
(c)
|
Cross default: failure by any
Group Company to make payment when due of any obligation (other than in
respect of the Finance Documents) exceeding USD 500,000 (five hundred
thousand US dollars) (or its equivalence in other currencies); or default
by any Group Company, in the performance of any agreement under which any
such obligation is created if the effect of such default is to cause such
obligation to become due, or to permit the holder or holders of such
obligation to declare such obligation due prior to its normal maturity;
or
|
|
|
(d)
|
Cessation: the cessation by
the Borrower of its operations or the sale or other disposition of all or
a substantial portion of its assets, or a decision by the Borrower to
cease its operations or to sell or otherwise dispose of all or a
substantial portion of its assets;
or
|
|
|
(e)
|
Unlawfulness: at any time it is
unlawful for an Obligor to perform any of its obligations under any
Finance Document or Transaction Document or if any Security Document is
not or ceases to be legal, valid and binding on any Group Company or does
not create the security it purports to create or becomes
unenforceable;
|
|
|
(f)
|
Legal process: any
judgment or order made against a Group Company is not stayed or complied
with within fourteen days or a creditor attaches or takes possession of,
or a distress, execution, sequestration or other process is levied or
enforced upon or against, any of the undertakings, assets, rights or
revenues of a Group Company and is not discharged within fourteen days,
unless in each case the same is being contested in good faith by
appropriate proceedings; or
|
- 18
-
|
|
(g)
|
Insolvency;
compositions: any Group Company
stops or suspends payment of any of its indebtedness or is unable or
admits inability to pay any of its indebtedness as it falls due or
commences negotiations with one or more of its creditors with a view to
the general readjustment or rescheduling of its indebtedness or proposes
or enters into any composition or other arrangement for the benefit of its
creditors generally or any class of creditors or proceedings are commenced
in relation to any Group Company under any law, regulation or procedure
relating to reconstruction or readjustment of its indebtedness so long as
such insolvency is not caused by Lender’s inability to fund under this
agreement; or
|
|
|
(h)
|
Bankruptcy or insolvency
proceedings: any Group Company takes any action or any
legal proceedings are started or other steps taken for (i) any Group
Company to be adjudicated or found bankrupt or insolvent, (ii) the
winding-up or dissolution of any Group Company or (iii) the appointment of
a liquidator, administrator, trustee, receiver or similar officer of any
Group Company or the whole or any part of their respective undertaking,
assets, rights or revenues; or
|
|
|
(i)
|
Change of ownership or control
of Borrower or any Group Company: if any person or group of persons
acting in concert gains control of the Borrower or any Group Company (for
the purposes hereof "control" shall have the same meaning as in clause
7.2.(b); or
|
|
|
(j)
|
Material adverse
change: any event or series of events occurs which, in
the reasonable opinion of the Lender, might have a material adverse effect
on the condition, operations, assets, liabilities and prospects of a
Borrower or a Group Company or on the ability of a Borrower or a Group
Company to comply with its obligations under the Financial
Documents.
|
|
|
(k)
|
Analogous Effect: Any
event occurs which, under the law of any relevant jurisdiction, has an
analogous or equivalent effect to any of the events mentioned in this
clause19.1.
|
|
|
(l)
|
Audit qualification: The
auditors of any Group Company qualify their report to any audited accounts
of the relevant Group Company;
|
|
|
(m)
|
Rescission: (i) any
party to the Transaction Documents rescinds or purports to rescind all or
part of that document where to do so would, in the Lender's opinion, have
a Material Adverse Effect; or (ii) any liquidator or other person takes
action to reverse or overturn the effect of a Transaction Document and the
Lender is advised that such action has a material prospect of success and
in the Lender's opinion such action would have a Material Adverse
Effect;
|
|
|
(n)
|
Litigation: Any
litigation, arbitration, administrative, governmental, regulatory or other
investigations, proceedings or disputes are commenced or threatened in
relation to the Transaction Documents or transaction contemplated in the
Transaction Documents or against any member of the Group or its assets
which has or is reasonably likely to have a Material Adverse
Effect;
|
|
|
(o)
|
Fishing Licences: if at
any time it is foreseeable that a fishing license of a Fishing Vessel is
withdrawn by the appropriate Croatian authorities or if at any time a
Fishing Vessel looses its fishing license or it becomes illegal for a
Fishing Vessel to fish in accordance with Croatian
laws.
|
- 19
-
|
19.2
|
Acceleration
|
On and at
any time after the occurrence of an Event of Default which is Continuing the
Lender may by notice to the Borrower and/or the Guarantors:
|
|
(a)
|
declare
any unborrowed amount to be cancelled after which the Facility shall be
reduced to zero; and/or
|
|
|
(b)
|
declare
the Loans to be immediately due and payable together with all interest,
fees and other amounts payable under this Agreement after which such sums
shall become due without further demand or other notice of any kind, all
of which are expressly waived by the Borrowers;
and/or
|
|
|
(c)
|
exercise
and/or enforce all or any of its rights under and pursuant to the Security
Documents in such manner as it sees
fit.
|
|
20.
|
ASSIGNMENTS
AND SUBSTITUTION
|
|
20.1
|
Successors
|
This
Agreement shall be binding upon and inure to the benefit of the Borrower and the
Lender and their respective permitted successors and assigns.
|
20.2
|
Assignments
by the Borrower
|
The
Borrowers may not assign or transfer all or any part of its rights or
obligations hereunder without the prior written consent of the
Lender.
|
20.3
|
Assignments
by the Lender
|
The
Lender may at any time assign or otherwise transfer or novate all or any part of
its rights or obligations hereunder and provided that any transferee shall have
confirmed to the Borrower prior to the transfer taking effect, that it
undertakes to be bound by the terms of this Agreement as the Lender in form and
substance satisfactory to the Borrower. On the transfer being made, the Lender
shall be relieved of its obligations to the extent of the transfer of such
obligations.
|
20.4
|
Sub-participations
|
Nothing
in this Agreement restricts the ability of the Lender to sub-participate or
sub-contract all or part of its rights and obligations if the Lender remains
liable under this Agreement for any such obligation.
|
21.
|
CHANGES
TO THE BORROWER
|
|
21.1
|
Assignments
and transfers by Borrower
|
No
Obligor may assign any of its rights or transfer any of its rights or
obligations under this Agreement.
- 20
-
|
22.
|
CONDUCT
OF BUSINESS BY THE LENDER
|
No
provision of this Agreement will:
|
|
(a)
|
interfere
with the right of the Lender to arrange its affairs (tax or otherwise) in
whatever manner it thinks fit;
|
|
|
(b)
|
oblige
the Lender to investigate or claim any credit, relief, remission or
repayment available to it or the extent, order and manner of any claim;
or
|
|
|
(c)
|
oblige
the Lender to disclose any information relating to its affairs (tax or
otherwise) or any computations in respect of
Tax.
|
|
23.
|
PAYMENT
MECHANICS
|
|
23.1
|
Partial
payments
|
If the
Lender receives a payment that is insufficient to discharge all the amounts then
due and payable under this Agreement, the Lender shall apply that payment
towards the obligations of that Borrower under this Agreement in the following
order:
|
|
(a)
|
first, in or towards
payment pro rata of any unpaid fees, costs and expenses of the
Lender;
|
|
|
(b)
|
secondly, in or towards
payment pro rata of any accrued interest or commission due but unpaid
under this Agreement;
|
|
|
(c)
|
thirdly, in or towards
payment pro rata of any principal due but unpaid under this
Agreement.
|
|
23.2
|
No
set-off by Borrower
|
All
payments to be made by the Borrower under this Agreement shall be calculated and
be made without (and free and clear of any deduction for) set-off or
counterclaim.
|
23.3
|
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.
|
|
23.4
|
Currency
of account
|
|
|
(a)
|
Subject
to sub-clauses (b) and (c) below, USD is the currency of account and
payment for any sum due from the Borrrower under this
Agreement.
|
|
|
(b)
|
Each
payment in respect of costs, expenses or Taxes shall be made in the
currency in which the costs, expenses or Taxes are
incurred.
|
|
|
(c)
|
Any
amount expressed to be payable in a currency other than USD shall be paid
in that other currency.
|
- 21
-
|
24.
|
SET-OFF
|
|
|
(a)
|
The
Lender may set off any matured or contingent obligation owed to it by the
Borrower under this Agreement against any matured or contingent obligation
owed by the Lender to that Borrower regardless of the place of payment,
booking branch or currency of either obligation. If the obligations are in
different currencies, the Lender may convert either obligation at a market
rate of exchange in its usual course of business for the purpose of the
set-off. No security interest is created by this
Clause.
|
|
25.
|
NOTICES
|
|
25.1
|
Communications
in writing
|
Any
communication to be made under or in connection with this Agreement by an
Obligor shall be made in writing and, unless otherwise stated, may be made by
facsimile or letter.
|
25.2
|
Addresses
|
The
address and facsimile 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 this Agreement
is:
|
|
(a)
|
in
the case of the Borrowers, that identified with its name
below;
|
|
|
(b)
|
in
the case of any other Obligor, that notified in writing to the Lender;
and
|
|
|
(c)
|
in
the case of the Lender, that identified with its name
below,
|
or any
substitute address, facsimile number, or department or officer as the Party may
notify to the Lender (or the Lender may notify to the other Parties, if a change
is made by the Lender) by not less than five Business Days' notice.
|
Borrower:
|
Lender:
|
||
|
Atlantis
Group hf.
|
|||
|
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇
|
Attn:
Óli Valur Steindórsson
|
||
|
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
▇▇▇▇▇▇▇▇▇
▇▇
|
||
|
▇▇▇
▇▇▇▇▇▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
|
|
25.3
|
Delivery
|
|
|
(a)
|
Any
communication or document made or delivered by one person to another under
or in connection with this Agreement will only be
effective:
|
|
|
(i)
|
if
by way of facsimile, at the time the facsimile transmission report (or
other appropriate evidence) confirming transmission is received by the
sender; or
|
|
|
(ii)
|
if
by way of letter, when it has been left at the relevant address or, if
posted, at noon on the second Business Day (in the case of an inland
address) or the fifth Business Day (in the case of an overseas address)
following the day of posting,
|
and, if a
particular department or officer is specified as part of its address details
provided under Clause 25.2(Addresses), if addressed to
that department or officer.
In
proving service it shall be sufficient to prove that personal delivery was made,
or that the envelope containing the communication was correctly addressed and
posted or that a facsimile transmission report (or other appropriate evidence)
was obtained.
- 22
-
|
|
(b)
|
Any
communication or document to be made or delivered to the Lender will be
effective only when actually received by the Lender and then only if it is
expressly marked for the attention of the department or officer identified
with the Lender's signature below (or any substitute department or officer
as the Lender shall specify for this
purpose).
|
|
26.
|
CALCULATIONS
AND CERTIFICATES
|
|
26.1
|
Accounts
|
The
accounts maintained by the Lender in connection with this Agreement shall, in
the absence of manifest error, be conclusive evidence of the matters to which
they relate.
|
26.2
|
Certificates
and Determinations
|
Any
certification or determination by the Lender of a rate or amount is, in the
absence of manifest error, conclusive evidence of the matters to which it
relates.
|
26.3
|
Day
count convention
|
Interest
shall accrue from day to day and be calculated on the basis of the actual number
of days elapsed and a 360 day year in respect of all fees and interest due in
USD. In determining the number of days in a period, the first day shall be
included but not the last.
|
27.
|
PARTIAL
INVALIDITY
|
If any
provision of this Agreement is illegal, invalid or unenforceable, the other
provisions and the remainder of the affected provision shall continue to be
valid.
|
28.
|
REMEDIES
AND WAIVERS
|
No
failure to exercise and no delay in exercising any right, remedy, power or
privilege of the Lender under this Agreement and no course of dealing between
the Parties shall be construed or operate as a waiver thereof, nor shall any
single or partial exercise of any right, remedy, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
|
28.1
|
Amendments
and waivers
|
Any term
of the this Agreement may be amended or waived only with the consent of the
Lender and the Borrowers and any such amendment or waiver will be binding on all
Parties.
|
29.
|
COUNTERPARTS
|
This
Agreement may be executed in any number of counterparts, each of which when
executed and delivered shall be an original, but all of which when taken
together shall constitute a single instrument.
- 23
-
|
30.
|
GOVERNING
LAW
|
This
Agreement is governed by Icelandic law.
|
31.
|
ENFORCEMENT
|
|
31.1
|
Jurisdiction
|
Each of
the Parties irrevocably agrees for the benefit of the Lender that the courts of
Iceland shall have jurisdiction to hear and determine any suit, action or
proceeding, and to settle any disputes, which may arise out of or in connection
with this Agreement and, for such purposes, irrevocably submits to the
jurisdiction of such courts. The Borrower hereby irrevocably and
unconditionally:
|
|
(a)
|
waives
any objection it may have to the laying of venue of any such proceedings
in any of the said courts and any claim it may have that any such
proceedings have been brought in an inconvenient forum or are being
brought before another court;
|
|
|
(b)
|
consents
to the service of process out of any of the said courts in any such
proceedings by the airmailing of copies, postage prepaid, to the Borrower
at its said address such service to be effective on the receipt at that
address;
|
|
|
(c)
|
agrees
that nothing herein shall affect the right to serve process in any other
manner permitted by law, or to bring proceedings before any other courts
of competent jurisdiction;
|
|
|
(a)
|
agrees
that the submission to the jurisdiction of the courts referred to above
shall not (and shall not be construed so as to) limit the right of the
Lender to take proceedings against the Borrower in any other court of
competent jurisdiction nor shall the taking of proceedings in any one or
more jurisdictions preclude the taking of proceedings in any other
jurisdiction (whether concurrently or not) if and to the extent permitted
by applicable law.
|
IN
WITNESS OF THE ABOVE, the representatives of the Parties have signed this
Agreement in the presence of witnesses.
Done in
Reykjavik on the September 23, 2010 effective as of June 30, 2010
AS WITNESS the hands of the
parties the day and year first above written.
THE
BORROWER
Address:
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇
Fax
number: ▇▇▇-▇▇▇-▇▇▇▇
Attention:
▇▇▇ ▇▇▇▇
By: ▇▇▇
▇▇▇▇
- 24
-
THE
LENDER
Atlantis
Group HF..
Address:
▇▇▇▇▇▇▇▇▇
▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇
Fax
no. ▇▇▇▇ ▇▇▇ ▇▇▇▇
Attention:
Mr. Oli Valur Steindorsson
By Oli
Valur Steindorsson
- 25
-
SCHEDULE
1
DEBT
ASSUMPTION AGREEMENT
This DEBT ASSUMPTION
AGREEMENT (this “Agreement”) made as of the
last date set forth on the signature page hereof”) in the year 2010 by and
between:
|
(1)
|
Atlantis Group Ltd, , an
Icelandic Corporation with its principal place of business at ▇▇▇▇▇▇▇▇▇
▇▇, ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, CPR nr. 700805-1580 (“the Lender”)
and
|
|
(2)
|
Umami Sustainable Seafood
Inc., a Nevada corporation having its offices at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (“the
Debtor”)
|
The
Lender and the Debtor are hereinafter referred to collectively as the
“Parties” and
individually as a “Party”.
WITNESSETH:
WHEREAS, the
Lender is holding controlling interests in the Debtor; and
WHEREAS
the Debtor has identified the Mexican Tuna fishing and farming company Baja
Acqua Farms S.A. de C.V. as a target for acquisition (the “Target”) ;
and
WHEREAS
the Lender has provided the Target with loans during the period of April 2010 to
August 2010 in the aggregated amount of USD $5,100,000.
WHEREAS
the Debtor wishes to assume this loan and to enter assume the rights of the
Lender to purchase 1/3 of the share capital of the Target for purchase price of
USD eight million together with the right pursuant a Call Option Agreement to
purchase the bulk of remaining shares in the Target; and
WHEREAS
the Lender is willing to facilitate those transactions in order to grant the
Debtor a clear right to purchase the Target in exchange for a debt assumption of
the said claim against the Target.
NOW,
THEREFORE, in consideration of the premises and the mutual representations and
covenants hereinafter set forth, the parties hereto do hereby agree as
follows:
|
|
I.
|
Debt
assumption –
|
1. The
Parties herby Agree that the Debtor, Umami Sustainable Seafood
Inc., is herby assuming the payment obligation of Baja Acqua Farms S.A.
de C.V towards the Lender in the amount of $5,100,000 USD and acquires at the
same time all the right attached to the claim against the Target.
The
Debtor shall be held fully liable for the repayment of this amount, regardless
that the Lender does hold the Target jointly liable for the repayment until he
claim is fully paid.
- 26
-
|
II
|
Remuniation
- repayment
|
2. The
Parties agree that the Debtor is assuming the said debt and is hereby having the
corresponding claim assigned and transferred to him in exchange for a Request
for utilisation of the Credit Facility extended to him according to the
Agreement thereof by the Lender in the corresponding Amount of $5,100,000
USD.
The
Lender is hereby granting this request and the Loan of the
same amount is defined as Term B Loan
Facility as referred to in
Art. 2 (b) of the Loan Agreement.
|
IV.
|
REPRESENTATIONS
BY the Debtor, here referred to as the
“company”
|
The
Debtor hereby represents and warrants to the Lender that:
4.1 The
Debtor is a company duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization and has full corporate power and
authority to conduct its business. The Company is not in violation of
any of the provisions of its Articles of Incorporation, by-laws or other
organizational or charter documents including, but not limited to, all documents
setting forth and/or establishing the terms, rights, conditions and/or
limitations of any of the Company’s stock (the “Internal
Documents”). The Debtor is duly qualified to conduct business
and is in good standing as a foreign corporation in each jurisdiction in which
the nature of the business conducted or property owned by it makes such
qualification necessary.
4.2 The
Debtor has all corporate right, power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby. All corporate
action on the part of the Company and its directors necessary for the
authorization execution, delivery and performance of this Agreement by the
Company documents and the performance of the Company’s obligations hereunder has
been taken. This Agreement has been duly executed and delivered by
the Company and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, subject
to laws of general application relating to bankruptcy, insolvency and the relief
of debtors and rules of law governing specific performance, injunctive relief or
other equitable remedies, and to limitations of public
policy.
|
V.
|
MISCELLANEOUS
|
5.1 Any
notice or communication made in relation to this Agreement or any document sent
in relation to this Agreement or the performance thereunder shall be in writing
in the English language and shall be deemed given when (i) personally delivered
or sent by a reputable courier service, (ii) sent by registered mail, postage
prepaid, and received, or (iii) transmitted by facsimile transmission, in any
case addressed to the Party to whom it is to be given at the following address
or at such other address as the Party to whom such notice is to be given shall
have last notified the other Party in accordance with the provisions of this
Article:
- 27
-
THE
BORROWER
Address:
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇
Fax
number: ▇▇▇-▇▇▇-▇▇▇▇
Attention:
▇▇▇ ▇▇▇▇
By: ▇▇▇
▇▇▇▇
THE
LENDER
Atlantis
Group HF..
Address:
▇▇▇▇▇▇▇▇▇
▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇
Fax
no. ▇▇▇▇ ▇▇▇ ▇▇▇▇
Attention:
Mr. Oli Valur Steindorsson
By Oli
Valur Steindorsson
5.2 All
of the representations and warranties contained in this Subscription Agreement
shall survive execution and delivery of this Subscription Agreement and the
undersigned’s investment in the Company.
5.3 The
parties agree to execute and deliver all such further documents, agreements and
instruments and take such other and further action as may be necessary or
appropriate to carry out the purposes and intent of this Agreement.
5.4 This
Agreement may be executed in two or more counterparts each of which shall be
deemed an original, but all of which shall together constitute one and the same
instrument.
5.5 Nothing
in this Agreement shall create or be deemed to create any rights in any person
or entity not a party to this Agreement.
5.6. This
Agreement shall be construed and enforced in accordance with, and all
questions concerning the construction, validity, interpretation and performance
of this Agreement shall be governed by, the internal laws of the Republic of
Iceland, without giving effect to any choice of law or conflict
of law provision or rule that would cause the application of the laws of any
jurisdictions other than the Republic of Iceland.
Any
dispute which is not settled between the parties shall be subject to the ruling
of the District Court of Reykjavik, Iceland
5.7. This
Agreement constitutes the entire agreement and understanding of the Parties with
respect to the subject matter of this Agreement, and supersedes all prior
discussions, agreements and understandings between the Parties with respect to
such subject. There are no unwritten oral agreements between the Parties. No
amendment or modification of this Agreement shall be binding on the Parties
unless made in writing expressly referring to this Agreement and signed by an
authorized representative of each.
- 28
-
5.8 This
Agreement takes effects and enters into force when signed by duly registered
representatives and stamped by dully registered company stamp of each
party.
(Signature
Pages to Follow)
IN WITNESS WHEREOF, the
undersigned have executed this Debt Assumption Agreement on September 22, 2010
effective as of July 1, 2010.
|
By:
|
|
|
Atlantis
Group Ltd
|
|
|
By:
|
|
- 29
-
SCHEDULE
2
UTILISATION
REQUEST
From:
[Borrower]
To:
[Lender]
Dated:
Dear
Sirs
USD [ ● ] Facility
Agreement
dated
[ ] (the "Agreement")
|
1.
|
We
refer to the Agreement. This is a Utilisation
Request. Terms defined in the Agreement have the same meaning
in this Utilisation Request unless given a different meaning in this
Utilisation Request.
|
|
2.
|
We
wish to borrow a Loan on the following
terms:
|
|
Proposed
Utilisation Date:
|
[ ]
(or, if that is not a Business Day, the next Business
Day)
|
|
Currency
of Loan:
|
USD:
|
|
Amount:
|
[ ]
or, if less, the Available
Facility
|
|
3.
|
We
confirm that each condition specified in Clause 4.2 (Further conditions
precedent) is satisfied on the date of this Utilisation
Request.
|
|
4.
|
This
Utilisation Request is irrevocable.
|
Yours
faithfully
…………………………………
authorised
signatory for Umami Sustainable Seafood Inc.
- 30
-
SCHEDULE
3
FORM
OF NOTE
Note
issued to Atlantis Group hf as Lender as defined in the Facility Agreement
referred to below:
Terms
defined in the Facility Agreement dated [#] 2010(as amended and restated from
time to time) and made between Umami Sustainable Seafood Inc., (as Borrower), Atlantis Group
hf (as Lender) (the "Facility
Agreement") have the same meaning in this debenture unless otherwise
defined in the debenture.
Umami Sustainable Seafood Inc., a
Nevada corporation having its offices at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇ (acknowledges from time to time that:
|
1.
|
it
is indebted to each Lender for such amounts in respect of principal due to
it from time to time in accordance with the Facility
Agreement;
|
|
2.
|
amounts
outstanding are payable in accordance with the Facility Agreement and bear
interest under the debenture (including default interest under clause
[8.3] of the Facility Agreement) at the rate, and are payable as, set out
in the Facility Agreement, the provisions of which to the extent
necessary, are taken to be incorporated by reference in this
debenture;
|
|
3.
|
all
payments under this debenture must be made at the time and place and in
the amount, currency and manner provided in the Facility Agreement;
and
|
|
4.
|
this
Note is a Finance Document and may not be amended or varied without the
consent of the Lender.
|
|
5.
|
this
Note shall be governed by Icelandic
law.
|
Dated
[***]
SIGNED
BY
For and
on behalf of Umami Sustainable Seafood Inc.,
………………………………..
Signature
………………………………..
Print
name
- 31
-