Loan Agreement among UABL BARGES (PANAMA) INC. UABL TOWING SERVICES S.A. MARINE FINANCIAL INVESTMENT CORP. and EASTHAM BARGES INC. as joint and several Borrowers and INTERNATIONAL FINANCE CORPORATION Dated as of September 15, 2008
Exhibit
2
Execution
Version
INVESTMENT
NUMBER 26858
among
UABL
BARGES (PANAMA) INC.
UABL
TOWING SERVICES S.A.
MARINE
FINANCIAL INVESTMENT CORP.
and
EASTHAM
BARGES INC.
as
joint and several Borrowers
and
INTERNATIONAL
FINANCE CORPORATION
Dated
as of September 15, 2008
TABLE
OF CONTENTS
Article/
Section
|
Item
|
Page No.
|
ARTICLE
I
|
1
|
|
Definitions
and Interpretation
|
1
|
|
Section
1.01.
|
Definitions
|
1
|
Section
1.02.
|
Financial
Calculations
|
35
|
Section
1.03.
|
Interpretation
|
35
|
Section
1.04.
|
Business
Day Adjustment
|
36
|
ARTICLE
II
|
36
|
|
The
Loan
|
36
|
|
Section
2.01.
|
The
Loan
|
36
|
Section
2.02.
|
Disbursement
Procedure
|
36
|
Section
2.03.
|
Interest
|
37
|
Section
2.04.
|
Change
in Interest Period
|
38
|
Section
2.05.
|
Default
Rate Interest
|
39
|
Section
2.06.
|
Repayment
|
39
|
Section
2.07A.
|
Voluntary
Prepayment
|
40
|
Section
2.07B.
|
Mandatory
Prepayment
|
41
|
Section
2.08.
|
Fees
|
42
|
Section
2.09.
|
Currency
and Place of Payments
|
43
|
Section
2.10.
|
Allocation
of Partial Payments
|
44
|
Section
2.11.
|
Increased
Costs
|
44
|
Section
2.12.
|
Unwinding
Costs
|
44
|
Section
2.13.
|
Suspension
or Cancellation by IFC
|
45
|
Section
2.14.
|
Cancellation
by the Borrowers
|
45
|
Section
2.15.
|
Taxes
|
46
|
Section
2.16.
|
Expenses
|
46
|
Section
2.17.
|
Illegality
of Participation
|
48
|
ARTICLE
III
|
49
|
|
Representations
and Warranties
|
49
|
|
Section
3.01.
|
Representations
and Warranties
|
49
|
Section
3.02.
|
IFC
Reliance
|
54
|
|
i
Article/
Section
|
Item
|
Page No.
|
|
ARTICLE
IV
|
54
|
|
Conditions
of Disbursement
|
54
|
|
Section
4.01.
|
Conditions
of Disbursement
|
55
|
Section
4.02.
|
Borrower's
Certification
|
64
|
Section
4.03.
|
Conditions
for IFC Benefit
|
64
|
ARTICLE
V
|
65
|
|
Particular
Covenants
|
65
|
|
Section
5.01.
|
Affirmative
Covenants
|
65
|
Section
5.02.
|
Negative
Covenants
|
69
|
Section
5.03.
|
Reporting
Requirements
|
72
|
Section
5.04.
|
Shipping
Covenants
|
75
|
Section
5.05.
|
Insurance
Covenants
|
79
|
ARTICLE
VI
|
85
|
|
Events
of Default
|
85
|
|
Section
6.01.
|
Acceleration
after Default
|
85
|
Section
6.02.
|
Events
of Default
|
85
|
Section
6.03.
|
Bankruptcy
|
90
|
ARTICLE
VII
|
90
|
|
Miscellaneous
|
90
|
|
Section
7.01.
|
Saving
of Rights
|
90
|
Section
7.02.
|
Notices
|
91
|
Section
7.03.
|
English
Language
|
92
|
Section
7.04.
|
Term
of Agreement
|
92
|
Section
7.05.
|
Applicable
Law and Jurisdiction
|
92
|
Section
7.06.
|
Disclosure
of Information
|
95
|
Section
7.07.
|
Successors
and Assignees
|
96
|
Section
7.08.
|
Amendments,
Waivers and Consents
|
96
|
Section
7.09.
|
Counterparts
|
96
|
ii
Article/
Section
|
Item
|
Page No.
|
|
ANNEX
A
|
98
|
PROJECT
COST AND FINANCIAL PLAN
|
98
|
ANNEX
B
|
99
|
PROJECT
AUTHORIZATIONS
|
99
|
ANNEX
C
|
101
|
INSURANCE
REQUIREMENTS
|
101
|
ANNEX
D
|
106
|
ANTI-CORRUPTION
GUIDELINES FOR IFC TRANSACTIONS
|
106
|
ANNEX
E
|
110
|
ENVIRONMENTAL
AND SOCIAL ACTION PLAN
|
110
|
SCHEDULE
1
|
113
|
FORM
OF CERTIFICATE OF INCUMBENCY AND AUTHORITY
|
113
|
SCHEDULE
2
|
115
|
FORM
OF REQUEST FOR DISBURSEMENT
|
115
|
SCHEDULE
3
|
118
|
FORM
OF DISBURSEMENT RECEIPT
|
118
|
SCHEDULE
4
|
119
|
FORM
OF ACCEPTANCE OF SERVICE OF PROCESS LETTER
|
119
|
SCHEDULE
5
|
121
|
FORM
OF LETTER TO GUARANTOR'S AUDITORS
|
121
|
SCHEDULE
6
|
123
|
FORM
OF BORROWER'S CERTIFICATION ON DISTRIBUTION OF DIVIDENDS
|
123
|
|
iii
Article/
Section
|
Item
|
Page No.
|
|
SCHEDULE
7
|
125
|
ACCEPTABLE
BROKERS
|
125
|
SCHEDULE
8
|
126
|
ENVIRONMENTAL
AND SOCIAL PERFORMANCE
|
126
|
iv
LOAN
AGREEMENT (this "Agreement") dated as of
September 15, 2008 among: (1) UABL BARGES (PANAMA) INC., UABL TOWING SERVICES
S.A. and MARINE FINANCIAL INVESTMENT CORP., each a corporation organized and
existing under the laws of the Republic of Panama, and EASTHAM BARGES INC., a
corporation organized and existing under the laws of the Republic of Liberia, as
joint and several borrowers (together, the "Borrowers"); and (2)
INTERNATIONAL FINANCE CORPORATION, an international organization established by
Articles of Agreement among its member countries including the Republic of
Panama and the Republic of Liberia ("IFC").
WHEREAS:
A.
|
The
Borrowers have requested that IFC lend an aggregate amount of up to
thirty-five million Dollars ($35,000,000) to the Borrowers to partially
finance: (i) the replacement of existing pushboat engines and the
conversion of pushboats to install such engines, (ii) the enlargement and
re-bottoming of existing barges, (iii) the construction and acquisition of
additional pushboats and barges and (iv) supplies and related equipment
for the foregoing; and
|
B.
|
IFC
has agreed to lend such amounts to the Borrowers on the terms and
conditions set forth in this
Agreement.
|
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE
I
Definitions
and Interpretation
Section 1.01. Definitions. Wherever
used in this Agreement, the following terms have the meanings opposite
them:
"Acceptable
Broker"
|
means
any of the sale and purchase ship brokerage companies listed in Schedule
7, as such list may from time to time be amended by agreement between IFC
and the Borrowers; and any other Person
that IFC may from time to time designate as an Acceptable
Broker;
|
"Accounting
Standards"
|
means
US Generally Accepted Accounting Principles ("USGAAP") consistently
applied;
|
"Action
Plan"
|
means
the set of environmental, health, safety and social activities with
specific deadlines to ensure compliance with the Performance Standards as
agreed between the IFC and the Guarantor on June 25, 2008, as such Action
Plan may be amended or supplemented from time to time with IFC's consent
(a copy of the Action Plan is attached here as Annex
E);
|
"Affiliate"
|
means
any Person directly or indirectly controlling, controlled by or under
common control with, another Person (for purposes of this definition,
"control" means the power to direct the management or policies of a
Person, directly or indirectly, whether through the ownership of shares or
other securities, by contract or otherwise, provided that the direct
or indirect ownership of ten per cent (10%) or more of the voting capital
stock of a Person is deemed to constitute control of that Person, and
"controlling" and
"controlled" have
corresponding meanings);
|
"Annual
Monitoring
Report"
|
means
an annual report setting out the specific social, environmental and
developmental impact reporting requirements of each Borrower in respect of
its operations, confirming that it is conducting operations in compliance
with Applicable S&E Law, the Action Plan and in a manner consistent
with the Performance Standards, or, as the case may be, detailing any
non-compliance or inconsistency together with the action being taken to
ensure compliance and in a form satisfactory to IFC, as such form of
Annual Monitoring Report may be amended or supplemented from time to time
with IFC's
consent (a copy of the Annual Monitoring Report is attached hereto as
Schedule 8);
|
2
"Applicable
S&E Law"
|
means
all applicable statutes, laws, ordinances, rules and regulations of
Argentina, Bolivia, Brazil, Paraguay and Uruguay, including but not
limited to any license, permit or other governmental authorization,
imposing liability or setting standards of conduct concerning any
environmental, social, labor, health and safety or security risks of the
type contemplated by the Performance
Standards;
|
"Auditors"
|
means
Pistrelli, Xxxxx, Xxxxxx y Asociados SRL, Member of E&Y Global or such
other firm of internationally recognized independent public accountants
that the Guarantor or a Borrower appoints from time to time as their
auditors pursuant to Section 5.01 (e) (Affirmative
Covenants);
|
"Authority"
|
means
any national, supranational, regional or local government or governmental,
administrative, fiscal, judicial, or government-owned body, department,
commission, authority, tribunal, agency or entity, or central bank (or any
Person, whether or not government owned and howsoever constituted or
called, that exercises the functions of a central
bank);
|
"Authorization"
|
means:
|
|
(a)
|
any
consent, registration, filing, agreement, notarization, certificate,
license, approval, permit, authority or exemption from, by or with any
Authority, whether given by express action or deemed given by failure to
act within any specified time period;
or
|
|
(b)
|
all
corporate, creditors' and shareholders' approvals or
consents;
|
3
|
|
"Authorized
Representative"
|
means
any natural person who is duly authorized by a Borrower, the Guarantor or
a Bareboat Charterer, as the case may be, to act on its behalf for the
purposes specified in, and whose name and a specimen of whose signature
appear on, the Certificate of Incumbency and Authority most recently
delivered by such Borrower, the Guarantor or such Bareboat Charterer, as
the case may be, to IFC;
|
"Bareboat
Charter"
|
means,
collectively:
|
|
(a)
|
a
bareboat charter party between a Borrower and Cornamusa providing for the
demise charter of one or more Mortgaged Vessels owned by such Borrower or
another Guarantor Subsidiary to Cornamusa;
and
|
|
(b)
|
any
other lease agreement or bareboat charter party in respect of one or more
Mortgaged Vessels entered into by a Borrower as owner or demise
owner;
|
|
and
in the singular means any one of them as the context may
require;
|
"Bareboat
Charter Assignment" |
means
an assignment in respect of a Bareboat Charter executed by a Borrower or
another Guarantor Subsidiary in favor of the Security Trustee for the
benefit of IFC as lender under this Agreement, IFC as lender under the
UABLPY Loan Agreement and, if the Parallel Loan is made, OFID, to secure
the Borrowers' obligations under this Agreement, UABLPY's obligations
under the UABLPY Loan Agreement, UABLPY's obligations under the Parallel
Loan Agreement (if the Parallel Loan is made) and the Guarantor's
obligations under the Guarantee
Agreement;
|
4
"Bareboat
Charter
Assignment
Acknowledgement
and
Consent"
|
means
an acknowledgement and consent executed by a Bareboat Charterer with
respect to each Bareboat Charter
Assignment;
|
"Bareboat
Charterer"
|
means
the charterer pursuant to any of the Bareboat
Charters;
|
"Business
Day"
|
"CAO"
|
means
Compliance Advisor Ombudsman, the independent accountability mechanism for
IFC that impartially responds to environmental and social concerns of
affected communities and aims to enhance
outcomes;
|
"CAO's
Role"
|
means,
as the context may require, to:
|
|
(a)
|
respond
to complaints by persons who have been or are likely to be directly
affected by the social or environmental impacts of IFC projects;
and
|
|
(b)
|
oversee
audits of IFC's social and environmental performance, particularly in
relation to sensitive projects, and to ensure compliance with IFC's social
and environmental policies, guidelines, procedures and
systems;
|
5
"Certificate
of Incumbency
and
Authority"
|
means
a certificate provided to IFC by a Borrower, the Guarantor or a Bareboat
Charterer in the form of Schedule
1;
|
"Coercive
Practice"
|
means
the impairing or harming, or threatening to impair or harm, directly or
indirectly, any Person or the property of such Person to influence
improperly the actions of a Person;
|
"Collateral"
|
means
all collateral referred to in the Security Documents and all other
property that is or is intended to be subject to any Lien in favor of IFC
or the Security Trustee acting, inter alia, for the benefit of IFC and/or
OFID;
|
"Collateral
Trust Agreement" |
means
the agreement among the Security Trustee, IFC as lender under this
Agreement and IFC as lender under the UABLPY Loan Agreement, and consented
to by each of the Borrowers and UABLPY for the limited purposes stated
therein, that creates a trust over the Collateral to be held by the
Security Trustee for the benefit of IFC as lender under this Agreement and
IFC as lender under the UABLPY Loan Agreement and that provides the manner
in which (a) such trust is to be administered by the Security Trustee and
(b) the proceeds of enforcement against the Collateral are to be
distributed to and applied by IFC as lender under this Agreement, IFC as
lender under the UABLPY Loan Agreement, the Borrowers and UABLPY, it being
understood and agreed that if the Parallel Loan is made OFID will be added
as a party to the Collateral Trust
Agreement;
|
"Collusive
Practice"
|
means
an arrangement between two or more Persons designed to achieve an improper
purpose, including to influence improperly the actions of another
Person;
|
6
"Consolidated
or Consolidated Basis" |
means
with respect to any financial statements to be provided, or any financial
calculation to be made, under or for the purposes of this Agreement and
any other Transaction Document the method referred to in Section 1.02 (c)
(Financial
Calculations);
|
"Constitutive
Documents"
|
means
with respect to each Borrower and the Guarantor, its certificate of
incorporation and by-laws and, with respect to any other Person (other
than a natural person), its constitutive documents, howsoever
called;
|
"Cornamusa"
|
means
Corporación de Navegación Mundial S.A., a corporation organized and
existing under the laws of Chile;
|
"Corrupt
Practice"
|
means
the offering, giving, receiving or soliciting, directly or indirectly, of
anything of value to influence improperly the actions of another
Person;
|
"Country"
|
means,
in respect of each of UABL Barges (Panama) Inc., UABL Towing Services S.A.
and Marine Financial Investment Corp., the Republic of Panama, and in
respect of Eastham Barges Inc., the Republic of
Liberia;
|
"Current
Assets"
|
means
the aggregate of a Person's cash, inventories, investments classified as
"held for trading", investments classified as "available for sale", trade
and other receivables realizable within one year, and prepaid expenses
which are to be charged to income within one
year;
|
"Current
Liabilities"
|
means
the aggregate of all liabilities of a Person falling due on demand or
within one year (including the portion of Long-term Debt, but excluding
Shareholder Loans, falling due within one
year);
|
7
"Current
Ratio"
|
means
the result obtained by dividing Current Assets (less prepaid expenses) by
Current Liabilities;
|
"Debt
to Equity Ratio"
|
means
the result obtained by dividing Financial Debt by Shareholders'
Equity;
|
"Debt
Service"
|
means
the aggregate amount of principal, interest and fees scheduled to be paid
by the Borrowers under the terms of this Agreement falling due in the next six
months over the Security
Period;
|
"Debt
Service Reserve
Account"
|
means
account number 0000000 opened in the name of the Borrowers and UABLPY with
M&T Trust Company of Delaware;
|
"Debt
Service Reserve
Account
Pledge"
|
means
a pledge in respect of the Debt Service Reserve Account executed by the
Borrowers and UABLPY in favor of the Security Trustee for the benefit of
IFC as lender under this Agreement, IFC as lender under the UABLPY Loan
Agreement and, if the Parallel Loan is made, OFID, to secure the
Borrowers' obligations under this Agreement, UABLPY's obligations under
the UABLPY Loan Agreement, UABLPY's obligations under the Parallel Loan
Agreement (if the Parallel Loan is made) and the Guarantor's obligations
under the Guarantee Agreement;
|
"Deputy
Commissioner's Office" |
"Derivative
Transaction"
|
means
any swap agreement, cap agreement, collar agreement, futures contract,
forward contract or similar arrangement with respect to interest rates,
currencies or commodity prices;
|
8
"Disbursement"
|
means
any disbursement of the Loan;
|
"Dollars"
and "$"
|
means
the lawful currency of the United States of
America;
|
"Eastham
Barges"
|
means
Eastham Barges Inc., a corporation organized and existing under the laws
of the Republic of Liberia;
|
"EH&S
Management
System"
|
means
a Person's environmental, health and safety management
system;
|
"Event
of Default"
|
means
any one of the events specified in Section 6.02 (Events of
Default);
|
"Fair
Market Value"
|
means:
|
|
(a)
|
in
relation to any Mortgaged Vessel that was acquired by a Borrower or
another Guarantor Subsidiary within ninety (90) days of the relevant date
of valuation from any Person who was not, at the time of such acquisition,
a member of the Ultrapetrol Group, the contracted acquisition price of
such Mortgaged Vessel for such acquisition plus, if the relevant
acquisition includes delivery in the United States of America, all costs
reasonably incurred in connection with positioning such Mortgaged
Vessel(s) in the Parana-Paraguay River System (the "River System") in Latin
America; or
|
9
|
(b)
|
in
relation to any other Mortgaged Vessel, the fair market value of such
Mortgaged Vessel, determined conclusively by the average of two valuations
made (each at the expense of the Borrowers) not more than 45 days prior to
the relevant date of valuation by two Acceptable Brokers selected by IFC,
such valuations being made on an "as is where is" basis, on the
basis of a sale for prompt delivery for cash on normal arm's-length
commercial terms as between a willing seller and a willing buyer, free of
any existing charter or other contract of employment, and on the basis of
the market along the River System in Latin America or on the basis of the
market in the United States appropriately adjusted for all costs
reasonably incurred in connection with positioning such Mortgaged
Vessel(s) in the River System in Latin America; provided that if the
higher of the two valuations referred to above is more than one hundred
and twenty per cent (120%) of the lower of such two valuations, then the
fair market value of such Mortgaged Vessel shall be determined
conclusively as the average of: (A) the higher of the two valuations
aforesaid, (B) the lower of the two valuations aforesaid and (C) a third
valuation by an Acceptable Broker selected by the
Borrowers;
|
"Financial
Debt"
|
means
any indebtedness of a Person or Persons, individually or in the aggregate,
for or in respect of:
|
|
(a)
|
borrowed
money;
|
|
(b)
|
the
outstanding principal amount of any bonds, debentures, notes, loan stock,
commercial paper, acceptance credits, bills or promissory notes drawn,
accepted, endorsed or issued by such
Person;
|
|
(c)
|
the
deferred purchase price of assets or services (except trade accounts
incurred and payable in the ordinary course of business to trade creditors
within ninety (90) days of the date they are incurred and which are not
overdue);
|
10
|
(d)
|
non-contingent
obligations of such Person to reimburse any other Person for amounts paid
by that Person under a letter of credit or similar instrument (excluding
any letter of credit or similar instrument issued for the account of such
Person with respect to trade accounts incurred and payable in the ordinary
course of business to trade creditors within ninety (90) days of the date
they are incurred and which are not
overdue);
|
|
(e)
|
the
amount of any obligation in respect of any Financial
Lease;
|
|
(f)
|
amounts
raised under any other transaction having the financial effect of a
borrowing and which would be classified as a borrowing (and not as an
off-balance sheet financing) under the Accounting
Standards;
|
|
(g)
|
the
amount of such Person's obligations under any Derivative Transactions (but
only the net amount owing by such Person after marking the relevant
derivative transactions to market);
|
|
(h)
|
any
premium payable on a redemption or replacement of any of the foregoing
items; and
|
|
(i)
|
without
double counting the amount of any obligation in respect of any guarantee
or indemnity given by such Person for any of the foregoing items incurred
by any other person;
|
|
provided that, for the
avoidance of doubt, Financial Debt does not include any Shareholder Loan
provided by Ultrapetrol and/or the Shareholders that is subordinated in
payment and liquidation to the
Loan;
|
11
"Financial
Lease"
|
means
any lease or hire purchase contract which would, under the Accounting
Standards, be treated as a finance or capital
lease;
|
"Financial
Plan"
|
means
the proposed sources of financing for the Project as set out in Annex A
(Project Cost and
Financial Plan);
|
"Financial
Year"
|
means
with respect to a Borrower or the Guarantor the accounting year of such
Person commencing each year on January 1 and ending on the following
December 31;
|
"Fraudulent
Practice"
|
means
any action or omission, including misrepresentation, that knowingly or
recklessly misleads, or attempts to mislead, a party to obtain a financial
benefit or to avoid an obligation;
|
"General
Ventures"
|
means
General Ventures Inc., a corporation organized and existing under the laws
of Liberia;
|
"Guarantee
Agreement"
|
means
the agreement entitled "Guarantee Agreement" dated the date of this
Agreement between the Guarantor and IFC, pursuant to which, inter alia,
the Guarantor unconditionally and irrevocably guarantees the obligations
of the Borrowers under this Agreement and UABLPY under the UABLPY Loan
Agreement;
|
"Guarantor"
|
means
UABL Limited, a corporation organized and existing under the laws of the
Bahamas;
|
"Guarantor
Subsidiary"
|
means
any entity:
|
|
(a)
|
over
50% of whose capital stock is owned, directly or indirectly, by the
Guarantor;
|
|
(b)
|
for
which the Guarantor may nominate or appoint a majority of the members of
the board
of directors or other body performing similar functions;
or
|
12
|
(c)
|
which
is otherwise effectively controlled by the
Guarantor;
|
"Historical
Debt Service Coverage Ratio" |
means
with respect to a Person the ratio obtained by
dividing:
|
|
(a)
|
the
aggregate, for the last 4 fiscal quarters prior to the relevant date of
calculation, of (i) Net Income for such calculation period, (ii) Non-Cash
Items, (iii) the amount of all payments that were due during such
calculation period on account of interest and other charges on Financial
Debt (to the extent deducted from Net Income), and (iv) the amount of all
charter hire payments due during such calculation period that were
subordinated in payment and liquidation to the Loan, less (v) the
aggregate amount of all maintenance capital expenditures made during such
calculation period, to the extent such expenditures were not already
deducted from Net Income;
|
by
|
(b)
|
all
scheduled payments (including balloon payments) that fell due during such
calculation period on account of principal of Long-term Debt and interest
and other charges on all Financial Debt but excluding voluntary
prepayments;
|
"IFC
Security"
|
means
the security created by or pursuant to the Security Documents to secure
all amounts owing by the Borrowers to IFC under this Agreement and the
other Transaction Documents;
|
13
"Increased
Costs"
|
means
the amount certified in an Increased Costs Certificate to be the net
incremental costs of, or reduction in return to, IFC or any participant
who has acquired a participation in the Loan in connection with the making
or maintaining of the Loan that result
from:
|
|
(a)
|
any
change in any applicable law or regulation or directive (whether or not
having the force of law) or in its interpretation or application by any
Authority charged with its administration;
or
|
|
(b)
|
compliance
with any request from, or requirement of, any central bank or other
monetary or other Authority;
|
|
which,
in either case, after the date of this
Agreement:
|
|
(i)
|
imposes,
modifies or makes applicable any reserve, special deposit or similar
requirements against assets held by, or deposits with or for the account
of, or loans made by, IFC;
|
|
(ii)
|
imposes
a cost on IFC as a result of IFC having made the Loan or reduces the rate
of return on the overall capital of IFC that it would have achieved, had
IFC not made the Loan;
|
|
(iii)
|
changes
the basis of taxation on payments received by IFC in respect of the Loan
(otherwise than by a change in taxation of the overall net income of IFC,
if any); or
|
14
|
(iv)
|
imposes
on IFC any other condition regarding the making or maintaining of the
Loan;
|
"Increased
Costs Certificate"
|
means
a certificate provided from time to time by IFC (based, if appropriate, on
a certificate to IFC from any participant who has acquired a participation
in the Loan, if Increased Costs affect its participation),
certifying:
|
|
(a)
|
the
circumstances giving rise to the Increased
Costs;
|
|
(b)
|
that
the costs of IFC have increased or the rate of return has been
reduced;
|
|
(c)
|
that
either IFC or such participant has, in IFC's opinion, exercised reasonable
efforts to minimize or eliminate the relevant increase or reduction, as
the case may be; and
|
(d) the
amount of Increased Costs;
"Insurances"
|
means:
|
|
(a)
|
all
policies and contracts of insurance (and reinsurance, if any), including
entries of a Mortgaged Vessel in any protection and indemnity or war risks
association, which are effected in respect of such Mortgaged Vessel, her
earnings or otherwise in relation to her as stated in Annex C;
and
|
|
(b)
|
all
rights and other assets relating to, or derived from, any of the
foregoing, including any rights to a return of a
premium;
|
15
"Insurance
Assignment"
|
means
in respect of each Mortgaged Vessel an assignment of such Mortgaged
Vessel's Insurances among the owner of such Mortgaged Vessel,
the Bareboat Charterer of such Mortgaged Vessel and the
Security Trustee for the benefit of IFC as lender under this Agreement,
IFC as lender under the UABLPY Loan Agreement and, if the Parallel Loan is
made, OFID as lender under the Parallel Loan Agreement, to secure the
Borrowers' obligations under this Agreement, UABLPY's obligations under
the UABLPY Loan Agreement, UABLPY's obligations under the Parallel Loan
Agreement (if the Parallel Loan is made) and the Guarantor's obligations
under the Guarantee Agreement; |
"Insurance
Assignment Acknowledgements and |
means
the letter of undertaking executed by the relevant underwriters and
protection and indemnity clubs in relation to each Insurance
Assignment;
|
"Intercreditor
Agreement"
|
means
the agreement to be entered into between IFC as lender under this
Agreement and the UABLPY Loan Agreement and OFID as a lender under the
Parallel Loan Agreement (if the Parallel Loan Agreement is made) setting
forth the manner in which the parties thereto agree to consult with each
other with respect to the exercise of their rights under the Collateral
Trust Agreement and to share the proceeds of enforcement against the
Collateral;
|
"Interest
Determination Date"
|
means
except as otherwise provided in Section 2.03 (d) (ii) (Interest), the second
Business Day before the beginning of each Interest
Period;
|
"Interest
Payment Date"
|
means
June 15 and December 15 in each year or, in the case of any Interest
Period of less than six (6) months, pursuant to Section 2.04 (Change in Interest
Period), any day that is the 15th
day of the month in which the relevant Interest Period
ends;
|
16
"Interest
Period"
|
means
each period of six (6) months or, in the circumstances referred to in
Section 2.04 (Change in
Interest Period), each period of three (3) months or one (1) month
determined pursuant to that Section, in each case beginning on an Interest
Payment Date and ending on the day immediately before the next following
Interest Payment Date, except in the case of the first period applicable
to each Disbursement when it means the period beginning on the date on
which that Disbursement is made and ending on the day immediately before
the next following Interest Payment
Date;
|
"Interest
Rate"
|
means
for any Interest Period, the rate at which interest is payable on the Loan
during that Interest Period, determined in accordance with Section 2.03
(Interest) and,
if applicable, Section 2.04 (Change in Interest
Period);
|
"Liabilities"
|
means,
in respect of a Person, the aggregate of all obligations of such Person to
pay or repay money, including, without
limitation:
|
|
(a)
|
Financial
Debt;
|
|
(b)
|
the
amount of all liabilities of such Person (actual or contingent) under any
conditional sale or a transfer with recourse or obligation to repurchase,
including, without limitation, by way of discount or factoring of book
debts or receivables;
|
|
(c)
|
taxes
(including deferred taxes);
|
|
(d)
|
trade
accounts incurred and payable in the ordinary course of business to trade
creditors within ninety (90) days of the date they are incurred and which
are not overdue (including letters of credit or similar instruments issued
for the account of such Person with respect to such trade
accounts);
|
17
|
(e)
|
accrued
expenses, including wages and other amounts due to employees and other
services providers;
|
|
(f)
|
the
amount of all liabilities of such Person howsoever arising to redeem any
of its shares; and
|
|
(g)
|
to
the extent (if any) not included in the definition of Financial Debt, the
amount of all liabilities of any Person to the extent such Person
guarantees them or otherwise obligate themselves to pay
them;
|
"LIBOR"
|
means
the British Bankers' Association ("BBA") interbank offered
rates for deposits in Dollars which appear on the relevant page of the
Reuters Service (currently page LIBOR01) or, if not available, on the
relevant pages of any other service (such as Bloomberg Financial Markets
Service) that displays such BBA rates; provided that if the BBA
for any reason ceases (whether permanently or temporarily) to publish
interbank offered rates for deposits in Dollars, "LIBOR" shall mean the
rate determined pursuant to Section 2.03 (d) (Interest);
|
"Lien"
|
means
any mortgage, pledge, charge, assignment, hypothecation, security
interest, title retention, preferential right, trust arrangement, right of
set-off, counterclaim or banker's lien, privilege or priority of any kind
having the effect of security, any designation of loss payees or
beneficiaries or any similar arrangement under or with respect to any
insurance policy or any preference of one creditor over another arising by
operation of law;
|
18
"Loan"
|
means
the loan specified in Section 2.01(a) (The Loan) or, as the
context requires, its principal amount from time to time
outstanding;
|
"Long-term
Debt"
|
means
that part of Financial Debt whose final maturity falls due more than one
year after the date it is incurred (including the current maturities
thereof);
|
"Major
Guarantor Subsidiary" |
means
a Guarantor Subsidiary or a group of Guarantor Subsidiaries which by
itself or on an aggregate basis owns Collateral or accounts for 5% or more
of the Guarantor's total assets or total
revenues;
|
"Marine
Financial"
|
means
Marine Financial Investment Corp., a corporation organized and existing
under the laws of the Republic of
Panama;
|
"Material Adverse
Effect"
|
means,
with respect to a Borrower, the Guarantor or another Guarantor Subsidiary,
a material adverse effect on:
|
|
(a)
|
such
Person's assets or properties;
|
|
(b)
|
such
Person's prospects or financial
condition;
|
|
(c)
|
the
implementation of the Project, the Financial Plan or the carrying on of
such Person's business or operations;
or
|
|
(d)
|
the
ability of such Person to comply with its obligations under this
Agreement, or under any other Transaction
Document;
|
19
"Mortgage"
|
means
a first preferred Liberian mortgage over one or more of the Mortgaged
Vessels, executed by the relevant Borrower or another Guarantor Subsidiary
as owner in favor of the Security Trustee for the benefit of IFC as lender
under this Agreement, IFC as lender under the UABLPY Loan Agreement and,
if the Parallel Loan is made, OFID, to secure the Borrowers'
obligations under this Agreement, UABLPY's obligations under the UABLPY
Loan Agreement, UABLPY's obligations under the Parallel Loan Agreement (if
the Parallel Loan is made) and the Guarantor's obligations under the
Guarantee Agreement;
|
"Mortgaged
Vessel"
|
means
a Vessel owned by a Borrower or another Guarantor Subsidiary that is
subject to a Mortgage, and shall include Vessels in the following priority
(except when such a priority of assets imposes a significant cost to the
Guarantor compared to other assets available for mortgage, as explained to
IFC):
|
|
(a)
|
newly
manufactured Vessels that are registered under the law of countries
acceptable to IFC;
|
|
(b)
|
pushboats
that are registered under the law of countries acceptable to IFC;
and
|
|
(c)
|
other
Liberian registered Vessels;
|
"Net
Income"
|
means,
for any calculation period, the excess (if any) of gross income over total
expenses (provided that income taxes shall be treated as part of total
expenses) appearing in the audited financial statements for such
calculation period;
|
"Non-Cash
Items"
|
means
for any calculation period, the net aggregate amount (which may be a
positive or negative number) of all non-cash income and non-cash expense
items which (under accrual accounting) have been added or subtracted in
calculating Net Income during that calculation period, including, without
limitation, equity earnings in Subsidiaries, asset revaluations,
depreciation, amortization, deferred taxes and provisions for severance
pay of staff and workers;
|
20
"Notes"
|
means
the 9% first preferred ship mortgage notes due 2014, issued by
Ultrapetrol, or such notes that may be issued in substitution or exchange
thereof by Ultrapetrol as a result of refinancing or rescheduling of such
notes, provided
that any new notes in substitution or exchange for the existing
Notes shall be (a) secured by not more than the existing security and
guarantees that have been provided by the Guarantor Subsidiaries in
respect of the existing Notes and (b) at no more favorable terms and
conditions of the security and guarantees for the existing Notes, unless
in the case of both (a) and (b) above the Security Coverage Ratio exceeds
1.6;
|
"Obstructive
Practice"
|
means
(a) deliberately destroying, falsifying, altering or concealing of
evidence material to the investigation or making of false statements to
investigators, in order to materially impede a World Bank Group
investigation into allegations of a Corrupt Practice, Fraudulent Practice,
Coercive Practice or Collusive Practice, and/or threatening, harassing or
intimidating any party to prevent it from disclosing its knowledge of
matters relevant to the investigation or from pursuing the investigation,
or (b) acts intended to materially impede the exercise of IFC's access to
contractually required information in connection with a World Bank Group
investigation into allegations of a Corrupt Practice, Fraudulent Practice,
Coercive Practice or Collusive
Practice;
|
"OFID"
|
means
the OPEC Fund for International
Development;
|
21
"Oceanpar"
|
means
Oceanpar S.A., a corporation organized and existing under the laws of
Paraguay;
|
"Other
Financing Documents"
|
means,
collectively:
|
|
(a)
|
the
Collateral Trust Agreement;
|
|
(b)
|
the
Intercreditor Agreement (if and when
executed);
|
|
(c)
|
the
Parallel Loan Documents (if and when
executed);
|
|
(d)
|
the
Shareholder Loan Agreements;
|
(e) the
Subordination Agreement; and
|
(f)
|
the
UABLPY Loan Documents;
|
|
and
in the singular means any one of them as the context may
require;
|
"Parallel
Loan"
|
means
the loan provided under the Parallel Loan
Agreement;
|
"Parallel
Loan Agreement"
|
means
the loan agreement made or to be made between OFID and UABLPY pursuant to
which, subject to the terms and conditions therein, OFID will make
available to UABLPY a loan in the amount of fifteen million Dollars
($15,000,000) for the same purposes as those for which the UABLPY Loan is
made;
|
"Parallel
Loan Documents"
|
means,
collectively, the Parallel Loan Agreement and all guarantees and security
documents executed per the terms of the Parallel Loan Agreement, and in
the singular means any one of them;
|
22
"Parfina"
|
means
Parfina S.A., a corporation organized and existing under the laws of
Paraguay;
|
"Performance
Standards"
|
means
IFC's Performance Standards on Social & Environmental Sustainability,
dated April 30, 2006, copies
of which have been delivered to and receipt of which has been acknowledged
by the Borrowers and incorporated herein by
reference;
|
"Permitted
Liens"
|
means:
|
|
(a)
|
Liens
created by the Security Documents;
|
|
(b)
|
Liens
for unpaid but not overdue master's and crew's wages in accordance with
usual maritime practice;
|
|
(c)
|
Liens
for salvage;
|
|
(d)
|
Liens
arising by operation of law for not more than two (2) months' prepaid hire
under any charter or other contract of employment in relation to a
Mortgaged Vessel not prohibited by this
Agreement;
|
|
(e)
|
Liens
for master's disbursements incurred in the ordinary course of trading and
any other Lien arising by operation of law or otherwise in the ordinary
course of the operation, repair or maintenance of a Mortgaged Vessel,
provided that such
liens do not secure amounts more than 30 days overdue (unless the overdue
amount is being contested by the relevant owner or bareboat charterer of
such Mortgaged Vessel in good faith by appropriate
steps);
|
23
|
(f)
|
any
Lien created in favor of a plaintiff or defendant by any action of the
court or tribunal before whom such action is brought as security for costs
and expenses where the relevant owner or bareboat charterer of such
Mortgaged Vessel is prosecuting or defending such proceedings or
arbitration in good faith by appropriate steps and such Lien does not (and
is not likely to) result in any
sale, forfeiture or loss of a Mortgaged Vessel;
and
|
|
(g)
|
Liens
arising by operation of law in respect of taxes which are not overdue for
payment or in respect of taxes being contested in good faith by
appropriate steps and in respect of which reserves, as appropriate under
the Accounting Standards, have been
made;
|
"Person"
|
means
any natural person, corporation, company, partnership, firm, voluntary
association, joint venture, trust, unincorporated organization, Authority
or any other entity whether acting in an individual, fiduciary or other
capacity;
|
"Potential
Event of Default"
|
means
any event or circumstance which would, with notice, lapse of time, the
making of a determination or any combination thereof, become an Event of
Default;
|
"Project"
|
means
the investment program in 2007-2010 by the Guarantor and its Subsidiaries
for: (a) the replacement of existing pushboat engines, and conversion of
pushboats to install these engines, (b) the enlargement and re-bottoming
of existing barges, (c) the construction and acquisition of additional
pushboats and barges and (d) supplies and related equipment for the
foregoing;
|
"Project
Documents"
|
means,
collectively:
|
|
(a)
|
the
Bareboat Charters;
|
24
|
(b)
|
any
bareboat charter party (or lease) between Cornamusa and UABLPY providing
for the sub-demise charter by Cornamusa of Mortgaged Vessels owned by a
Borrower to UABLPY; and
|
|
(c)
|
any
bareboat charter party between any of Riverview, Oceanpar, Parfina or
General Ventures, respectively, and the Guarantor providing for the demise
charter of vessels owned by any of Riverview, Oceanpar, Parfina or General
Ventures to the Guarantor;
|
and in
the singular means any one of them as the context may require;
"Prospective
Debt
Service
Coverage Ratio"
|
means,
in respect of a Person, the ratio obtained by
dividing:
|
|
(a)
|
the
aggregate, for the Financial Year most recently ended prior to the
relevant date of calculation for which audited financial statements are
available or for the last 4 fiscal quarters prior to the relevant date of
calculation, where applicable, of (i) Net Income for that calculation
period, (ii) Non-Cash Items, (iii) the amount of all payments that were
due during that calculation period on account of interest and other
charges on Financial Debt (to the extent deducted from Net Income) and
(iv) the amount of all charter hire payments due during that calculation
period that were subordinated in payment and liquidation to the
Loan;
|
by
25
|
(b)
|
the
aggregate of (i) all scheduled payments (including balloon payments) that
fall due during such calculation period in which the
relevant date of calculation falls on account of principal of
Long-term Debt and interest and other charges on all Financial Debt and
(ii)
without double counting any payment already counted in the preceding
sub-clause (i), any payment made or required to be made to any debt
service account under the terms of any agreement providing for Financial
Debt but excluding voluntary
prepayments;
|
where, for the purposes of clause (b)
above:
|
(x)
|
subject
to sub-clause (y) below, for the computation of interest payable during
any period for which the applicable rate is not yet determined, that
interest shall be computed at the rate in effect at the time of the
relevant date of calculation;
|
|
(y)
|
interest
on Short-term Debt payable in such calculation period in which the
relevant date of calculation falls shall be computed by reference to the
aggregate amount of interest thereon paid during that Financial Year up to
the end of the period covered by the latest quarterly financial statements
prepared by the Borrowers multiplied by a factor of 4, 2 or 4/3 depending
on whether the computation is made by reference to the financial
statements for the first quarter, the first two quarters or the first
three quarters, respectively; and
|
26
|
(z)
|
during
any grace period year, for the computation of Prospective Debt Service
Coverage Ratio for the purposes of determining the Relevant Spread, the
scheduled payments shall include the amount of the first two scheduled
principal repayments of the
Loan, the UABLPY Loan and the Parallel Loan, if
made;
|
"Relevant
Spread"
|
means:
|
|
(a)
|
from
and including the date of the first Disbursement to and including the
first June 15 to fall thereafter, three per cent (3.0%) per annum;
and
|
|
(b)
|
at
all other times in accordance with the table
below:
|
Guarantor Prospective Debt Service Coverage
Ratio
|
Spread
|
|
4.01
and above
|
1.875%
|
|
3.75
- 4.00
|
2.000%
|
|
3.50
- 3.75
|
2.125%
|
|
3.25
- 3.50
|
2.250%
|
|
3.00
- 3.25
|
2.375%
|
|
2.75
- 3.00
|
2.500%
|
|
2.50
- 2.75
|
2.625%
|
|
2.25
- 2.50
|
2.750%
|
|
2.00
- 2.25
|
2.875%
|
|
1.75
- 2.00
|
3.000%
|
|
1.50
- 1.75
|
3.125%
|
|
below
1.50
|
3.250%
|
27
On May 15
of each year, the Borrowers shall submit to IFC a calculation of the Prospective
Debt Service Coverage Ratio based on the Guarantor's audited consolidated
financial statements for the previous financial year and the Relevant Spread
from and including June 16 of such year to and including June 15 of the
following year shall be calculated per the above table. In the event
that the Borrowers fail to submit by the May 15 deadline the calculation of the
Guarantor's Prospective Debt Service Coverage Ratio, the Relevant Spread shall
be (a) determined by IFC or (b) the existing spread at the time of calculation
plus one-half of a per cent (0.5%); whichever is higher;
"Responsible
Carrier Program"
|
means
the framework of voluntary standards of conduct and practices established
in 1994 by the American Waterways Organization for developing
company-specific safety and environmental programs to improve marine
safety and environmental protection in the tugboat, towboat and barge
industry;
|
"Riverview"
|
means
Riverview Commercial Corp., a corporation organized and existing under the
laws of the Republic of Panama;
|
"Sanctionable
Practice"
|
means
any Corrupt Practice, Fraudulent Practice, Coercive Practice, Collusive
Practice, or Obstructive Practice, as those terms are defined herein and
interpreted in accordance with the Anti-Corruption Guidelines attached to
this Agreement as Annex D;
|
"Security
Coverage Ratio"
|
means
a ratio of the aggregate Fair Market Value of the Mortgaged Vessels to the
aggregate principal amount of the Loan, the UABLPY Loan and, if made, the
Parallel Loan;
|
"Security
Documents"
|
means,
collectively, the documents providing for the IFC Security consisting
of:
|
28
|
(a)
|
the
Bareboat Charter Assignments and the Bareboat Charter Assignment
Acknowledgements and Consents;
|
|
(b)
|
the
Debt Service Reserve Account
Pledge;
|
|
(c)
|
the
Insurance Assignments and the Insurance Assignment Acknowledgments and
Consents;
|
|
(d)
|
the
Mortgages;
|
|
(e)
|
the
Shareholder Loan Agreement Assignments and the Shareholder Loan Agreement
Assignment Acknowledgments and Consents;
and
|
|
(f)
|
the
Share Pledge Agreements;
|
and in
the singular means any one of them as the context may require;
"Security
Period"
|
means
the period commencing on the date of this Agreement and ending on the date
on which the Security Trustee notifies the Borrowers
that:
|
|
(a)
|
all
amounts which have become due for payment by the Borrowers or the
Guarantor under the Transaction Documents have been
paid;
|
|
(b)
|
no
amount is owing or has accrued (without yet having become due for payment)
under any Transaction Document;
|
|
(c)
|
none
of the Borrowers nor the Guarantor has any future or contingent liability
under any provision of this Agreement or another Transaction
Document;
|
29
|
(d)
|
none
of the Security Trustee or IFC as lender under this Agreement and IFC as
lender under the UABLPY Loan Agreement (and if the Parallel Loan is made,
OFID) believes that there is a significant risk that any payment or
transaction under a Transaction Document would be set aside, or would have
to be reversed or adjusted, in any present or possible future bankruptcy
of a Borrower or the Guarantor or in any present or possible future
proceeding relating to a Transaction Document or any asset covered (or
previously
covered) by IFC Security created by a Transaction Document;
and
|
|
(e)
|
IFC
has no further obligation to make any Disbursement under this Agreement
and the UABLPY Loan Agreement and OFID has no further obligation to make
any Disbursement under the Parallel Loan
Agreement;
|
"Security
Trustee"
|
M&T
Trust Company of Delaware, a Delaware limited purpose trust company, with
offices at 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx
00000, Xxxxxx Xxxxxx of America, or such other institution as may be
agreed per the terms of the Collateral Trust
Agreement;
|
"Share
Pledge Agreement"
|
means
a pledge in respect of the capital stock of each of the Borrowers executed
by the Guarantor in favor of the Security Trustee for the benefit of IFC
as lender under this Agreement, IFC as lender under the UABLPY Loan
Agreement and, if the Parallel Loan is made, OFID, to secure the
Borrowers' obligations under this Agreement, UABLPY's obligations under
the UABLPY Loan Agreement, UABLPY's obligations under the Parallel Loan
Agreement (if the Parallel Loan is made) and the Guarantor's obligations
under the Guarantee Agreement;
|
30
"Share
Retention Agreement"
|
means
the agreement made among Ultrapetrol, the Shareholders, the Guarantor and
IFC pursuant to which (a) Ultrapetrol and the Shareholders undertake to
maintain direct and indirect shareholdings in the Guarantor and (b) the
Guarantor undertakes to maintain direct and indirect shareholdings in each
of the Borrowers and UABLPY;
|
"Shareholder
Loan"
|
means
the loan provided under a Shareholder Loan
Agreement;
|
"Shareholder
Loan Agreement"
|
means
an agreement, in form and substance satisfactory to IFC, providing for a
loan to the Guarantor, or any Guarantor Subsidiary (including the
Borrowers), by Ultrapetrol or any of Ultrapetrol's
Subsidiaries;
|
"Shareholder
Loan Agreement Assignment" |
means
an assignment executed by the relevant lender in respect of its rights
under any Shareholder Loan Agreement, such assignment to be in favor of
the Security Trustee for the benefit of IFC as lender under this
Agreement, IFC as lender under the UABLPY Loan Agreement and, if the
Parallel Loan is made, OFID, to secure the Borrowers' obligations under
this Agreement, UABLPY's obligations under the UABLPY Loan Agreement,
UABLPY's obligations under the Parallel Loan Agreement (if the Parallel
Loan is made) and the Guarantor's obligations under the Guarantee
Agreement;
|
"Shareholder
Loan Agreement Assignment |
means
an acknowledgement and consent executed by the intercompany borrower under
and with respect to each Shareholder Loan Agreement
Assignment;
|
31
"Shareholders"
|
means
UP River (Holdings) Limited, a corporation organized and existing under
the laws of Bahamas, and UPB (Panama) Inc., a corporation organized and
existing under the laws of the Republic of Panama or any other
shareholders of the Guarantor;
|
"Shareholders'
Equity"
|
means
the aggregate of:
|
|
(a)
|
the
amount paid up on the share capital of a
Person;
|
|
(b)
|
the
amount standing to the credit of the reserves of such Person (including,
without limitation, any share premium account, capital redemption reserve
funds and any credit balance on the accumulated profit and loss account);
and
|
|
(c)
|
any
Shareholder Loan provided by Ultrapetrol or the Shareholders that is
subordinated in payment and liquidation to the
Loan;
|
|
after
deducting from that aggregate (i) any debit balance on the profit and loss
account or impairment of the issued share capital of the relevant Person
(except to the extent that deduction with respect to that debit balance or
impairment has already been made), (ii) amounts set aside
for dividends or taxation (including deferred taxation), (iii) amounts
attributable to capitalized items such as goodwill, trademarks, deferred
charges, licenses, patents and other intangible assets and (iv) loans or
advances to, deposits (except commercial bank deposits) or investments in,
direct or indirect shareholders of the relevant
Person;
|
32
"Short-term
Debt"
|
means
all Financial Debt other than Long-term
Debt:
|
"Subordination Agreement"
|
means
the agreement made among Ultrapetrol, the Shareholders, the Guarantor and
IFC providing, inter alia, for the subordination at the times and in the
circumstances therein described of payments by the Guarantor and its
Subsidiaries (including the Borrowers) to Ultrapetrol and the
Shareholders;
|
"Subsidiary"
|
means
with respect to any Person, any
entity:
|
|
(a)
|
over
50% of whose capital is owned, directly or indirectly, by that
Person;
|
|
(b)
|
for
which that Person may nominate or appoint a majority of the members of the
board of directors or other body performing similar functions;
or
|
|
(c)
|
which
is otherwise effectively controlled by that
Person;
|
"Taxes"
|
means
any present or future taxes, withholding obligations, duties and other
charges of whatever nature levied by any
Authority;
|
"Transaction
Documents" means
collectively:
(a) this
Agreement;
(b) the
Guarantee Agreement;
(c) the
Other Financing Documents;
(d) the
Project Documents;
|
(e)
|
the
Security Documents; and
|
(f)
the Share Retention Agreement;
33
and in
the singular means any one of them as the context may require;
"UABLPN"
|
means
UABL Barges (Panama) Inc., a corporation organized and existing under the
laws of the Republic of Panama;
|
"UABLPY"
|
means
UABL Paraguay S.A., a corporation organized and existing under the laws of
Paraguay;
|
"UABLPY
Loan"
|
means
the loan provided under the UABLPY Loan
Agreement;
|
"UABLPY
Loan Agreement"
|
means
the loan agreement made between UABLPY and IFC pursuant to which, subject
to the terms and conditions therein, IFC will make available to UABLPY a
loan in the amount of twenty-five million Dollars ($25,000,000) for the
same purposes for which the Loan is
made;
|
"UABLPY
Loan Documents"
|
means,
collectively, the UABLPY Loan Agreement and all guarantees and security
documents executed per the terms of the UABLPY Loan Agreement, and in the
singular means any one of them;
|
"UABLTS"
|
means
UABL Towing Services S.A., a corporation organized and existing under the
laws of the Republic of Panama;
|
"Ultrapetrol"
|
means
Ultrapetrol (Bahamas) Limited, a corporation organized and existing under
the laws of the Bahamas;
|
"Ultrapetrol
Group" means
Ultrapetrol and its Subsidiaries;
"Vessel"
|
means
a pushboat or barge owned by a Borrower, the Guarantor or any Guarantor
Subsidiary, together with all ancillary equipment and parts;
and
|
34
"World
Bank"
|
means
the International Bank for Reconstruction and Development, an
international organization established by Articles of Agreement among its
member countries.
|
Section
1.02. Financial
Calculations. (a) All financial calculations to be made under,
or for the purposes of, this Agreement and any other Transaction Document shall be made in
accordance with the Accounting Standards and, except as otherwise required to
conform to any provision of this Agreement, shall be calculated from the then
most recently issued quarterly financial statements and on a rolling last twelve
month basis (where applicable) which the Borrowers are obligated to furnish to
IFC under
Section 5.03 (a) (Reporting
Requirements) or, as the case may be, the Guarantor is required to
provide to IFC under Section 6.03 (a) (Reporting Covenants) of the
Guarantee Agreement.
(b) Where
quarterly financial statements from the last quarter of a Financial Year are
used for the purpose of making certain financial calculations, at IFC's option,
those calculations may instead be made from the audited financial statements for
such Financial Year.
(c) If
a financial calculation is to be made under or for the purposes of this
Agreement or any other Transaction Document on a Consolidated Basis, that
calculation shall be made by reference to the sum of all amounts of similar
nature reported in the relevant financial statements of each of the entities
whose accounts are to be consolidated with the accounts of the Borrowers or the
Guarantor, as the case may be, plus or minus the consolidation adjustments
customarily applied to avoid double counting of transactions among any of those
entities, including the Borrowers and the Guarantor, as the case may
be.
Section 1.03. Interpretation. In
this Agreement, unless the context otherwise requires:
(a) headings
are for convenience only and do not affect the interpretation of this
Agreement;
(b) words
importing the singular include the plural and vice versa;
(c) a
reference to an Annex, Article, party, Schedule or Section is a reference to
that Article or Section of, or that Annex, party or Schedule to, this
Agreement;
35
(d) a
reference to a document includes an amendment or supplement to, or replacement
or novation of, that document but disregarding any amendment, supplement,
replacement or novation made in breach of this Agreement; and
(e) a
reference to a party to any document includes that party's successors and
permitted assigns.
Section 1.04. Business
Day Adjustment. (a) When an Interest Payment Date is not a
Business Day, then such Interest Payment Date shall be automatically changed to
the next Business
Day in that calendar month (if there is one) or the preceding Business Day (if
there is not).
(b) When
the day on or by which a payment (other than a payment of principal or interest)
is due to be made is not a Business Day, that payment shall be made on or by the
next Business Day in that calendar month (if there is one) or the preceding
Business Day (if there is not).
ARTICLE
II
The
Loan
Section 2.01. The
Loan. Subject to the provisions of this Agreement, IFC agrees
to lend, and the Borrowers agree to borrow on a joint and several basis, the
Loan consisting of thirty-five million Dollars ($35,000,000).
Section
2.02. Disbursement
Procedure. (a) The Borrowers may request
Disbursements by delivering to IFC, at least ten (10) Business Days prior to the
proposed date of disbursement, a Disbursement request substantially in the form
of Schedule 2.
(b) Each
Disbursement shall be made by IFC for credit to the Borrowers' account at such a
bank as the Borrowers shall indicate, or to any other Person or account as the
Borrowers shall indicate that is acceptable to IFC, all as specified by the
Borrowers in the relevant Disbursement request.
(c) Each
Disbursement (other than the last one) shall be made in an amount of not less
than $3,000,000.
36
(d) The
Borrowers shall deliver to IFC a receipt, substantially in the form of Schedule
3, within five (5) Business Days following each Disbursement.
Section
2.03. Interest. Subject
to the provisions of Section 2.05 (Default Rate Interest), the
Borrowers shall pay interest on the Loan in accordance with this Section 2.03
(Interest):
(a) During
each Interest Period, the Loan (or, with respect to the first Interest Period
for each Disbursement, the amount of that Disbursement) shall bear interest at
the applicable Interest Rate for that Interest Period.
(b) Interest
on the Loan shall accrue from day to day, be prorated on the basis of a 360-day
year for the actual number of days in the relevant Interest Period and be
payable in arrears on the Interest Payment Date immediately following the end of
that Interest Period; provided that with respect to any Disbursement made less
than fifteen (15) days before an Interest Payment Date, interest on that
Disbursement shall be payable commencing on the second Interest Payment Date
following the date of that Disbursement.
(c) Subject
to Section 2.04 (Change in
Interest Period), the Interest Rate for any Interest Period shall be the
rate which is the sum of:
|
(i)
|
the
Relevant Spread; and
|
|
(ii)
|
LIBOR
on the Interest Determination Date for that Interest Period for six (6)
months (or, in the case of the first Interest Period for any Disbursement,
for one (1) month, two (2) months, three (3) months or six (6) months,
whichever period is closest to the duration of the relevant Interest
Period (or, if two periods are equally close, the longer one)) rounded
upward to the nearest three decimal
places.
|
(d) If,
for any Interest Period, IFC cannot determine LIBOR by reference to the Reuters
Service or any other service that displays BBA rates, IFC shall notify the
Borrowers and shall instead determine LIBOR:
|
(i)
|
on
the second Business Day before the beginning of the relevant Interest
Period by calculating the arithmetic mean (rounded upward to the nearest
three decimal places) of the offered rates advised to IFC on or around
11:00 a.m., London time, for deposits in Dollars and otherwise in
accordance with Section 2.03 (c) (ii) (Interest), by any four
(4) major banks active in Dollars in the London interbank market, selected
by IFC; provided that if less than four quotations are received, IFC may
rely on the quotations so received if not less than two (2);
or
|
37
|
(ii)
|
if
less than two (2) quotations are received from the banks in London in
accordance with subsection (i) above, on the first day of the relevant
Interest Period, by calculating the arithmetic mean (rounded upward to the
nearest three decimal places) of the offered rates advised to IFC on or
around 11:00 a.m., New York time, for loans in Dollars and otherwise in
accordance with Section 2.03 (c) (ii) (Interest), by a major
bank or banks in New York, New York selected by
IFC.
|
(e) On
each Interest Determination Date for any Interest Period, IFC shall determine
the Interest Rate applicable to that Interest Period and promptly notify the
Borrowers of those rates.
(f) The
determination by IFC, from time to time, of the applicable Interest Rate shall
be final and conclusive and bind the Borrowers (unless the Borrowers show to
IFC's satisfaction that the determination involves manifest error).
Section
2.04. Change
in Interest Period. Without prejudice to the provisions of
Section 2.05 (Default Rate
Interest), if at any time the Borrowers fail to pay any amount of
principal of, or interest on, the Loan when due (whether at stated maturity or
upon acceleration), and any part of that amount remains unpaid on the third
Business Day immediately preceding any Interest Payment Date falling after that
amount became due, then:
(a) IFC
may elect that the duration of the Interest Period commencing on that Interest
Payment Date and, subject to Section 2.04 (c) (Change in Interest Period),
any subsequent Interest Period shall be either three (3) months or one (1) month
and shall notify the Borrowers of that election in the notice referred to in
Section 2.03 (e) (Interest);
(b) the
Interest Rates applicable to any Interest Period which is three (3) months or
one (1) month shall be determined in accordance with Section 2.03 (Interest) in all respects,
except that any reference in Section 2.03 (c) (ii) (Interest) to six (6) months
shall be deemed to be a reference to three (3) months or, as the case may be,
one (1) month; and
38
(c) unless
an Event of Default or Potential Event of Default has occurred and is
continuing, IFC shall reinstate Interest Periods of six (6) months as of
the first Interest Payment Date which is June 15 or December 15 falling at least
three (3) Business Days after the payment default is remedied in full and shall
inform the Borrowers of that reinstatement in the notice referred to in Section
2.03 (e) (Interest).
Section
2.05. Default
Rate Interest. (a) Without limiting the remedies available to
IFC under this Agreement or otherwise (and to the maximum extent permitted by
applicable law), if the Borrowers fail to make any payment of principal or
interest (including interest payable pursuant to this Section) or any other
payment provided for in Section 2.08 (Fees) when due as specified
in this Agreement (whether at stated maturity or upon acceleration), the
Borrowers shall pay interest on the amount of that payment due and unpaid at the
rate which shall be the sum of two per cent (2%) per annum plus the Interest
Rate in effect from time to time.
(b) Interest
at the rate referred to in Section 2.05 (a) (Default Rate Interest) shall
accrue from the date on which payment of the relevant overdue amount became due
until the date of actual payment of that amount (as well after as before
judgment), and shall be payable on demand or, if not demanded, on each Interest
Payment Date falling after any such overdue amount became due.
Section
2.06. Repayment. (a)
Subject to Section 1.04 (Business Day Adjustment), the
Borrowers shall repay the Loan on the following Interest Payment Dates and in
the following amounts:
Interest Payment Date
|
Principal Amount Due
|
June
15, 2012
|
$1,521,800
|
December
15, 2012
|
$1,521,800
|
June
15, 2013
|
$1,521,800
|
December
15, 2013
|
$1,521,800
|
June
15, 2014
|
$1,521,800
|
December
15, 2014
|
$1,521,800
|
June
15, 2015
|
$1,521,800
|
December
15, 2015
|
$1,521,800
|
June
15, 2016
|
$1,521,800
|
December
15, 2016
|
$2,662,975
|
June
15, 2017
|
$2,662,975
|
December
15, 2017
|
$2,662,975
|
June
15, 2018
|
$2,662,975
|
December
15, 2018
|
$2,662,975
|
June
15, 2019
|
$2,662,975
|
December
15, 2019
|
$2,662,975
|
June
15, 2020
|
$2,662,975
|
39
(b) Upon
each Disbursement, the amount disbursed shall be allocated for repayment on each
of the respective dates for repayment of principal set out in the table in
Section 2.06 (a) (Repayment) in amounts which
are pro rata to the amounts
of the respective installments shown opposite those dates in that table (with
IFC adjusting those allocations as necessary so as to achieve whole numbers in
each case).
(c) Any
principal amount of the Loan repaid under this Section 2.06 (Repayment) may not be
re-borrowed.
Section
2.07A. Voluntary
Prepayment Without prejudice to Section 2.11 (Increased Costs), Section
2.15 (Taxes), Section
2.17 (Illegality of
Participation) and Section 5.05 (Insurance
Covenants):
(a) the
Borrowers may prepay all or any part of the Loan, on not less than thirty (30)
days' prior notice to IFC, but only if:
|
(i)
|
the
Borrowers simultaneously pay all accrued interest and Increased Costs (if
any) on the amount of the Loan to be prepaid, together with the prepayment
premium specified in Section 2.07A (b) (Voluntary Prepayment)
and all other amounts then due and payable under this Agreement, including
the amount payable under Section 2.12 (Unwinding Costs), if
the prepayment is not made on an Interest Payment
Date;
|
|
(ii)
|
for
a partial prepayment, that prepayment is an amount not less than two
million Dollars ($2,000,000); and
|
|
(iii)
|
if
requested by IFC, the Borrowers deliver to IFC, prior to the date of
prepayment, evidence satisfactory to IFC that all necessary Authorizations
with respect to the prepayment have been obtained and are in
effect.
|
40
(b) On
the date of any prepayment of the Loan in accordance with Section 2.07A (a)
(Voluntary Prepayment),
the Borrowers shall pay a prepayment premium consisting of an amount in Dollars
equal to the relevant percentage of the amount to be prepaid, such percentage
being determined as follows: (i) on or prior to June 15, 2012, two per cent
(2%); and (ii) thereafter, one per cent (1%). The determination by
IFC of the prepayment premium shall be final and conclusive and bind the
Borrowers (unless the Borrowers show, to the satisfaction of IFC, that such
determination involved manifest error).
(c) Amounts
of principal prepaid under this Section shall be applied by IFC to the then
outstanding installments of principal of the Loan in inverse order of
maturity.
(d) Upon
delivery of a notice in accordance with Section 2.07A (a) (Voluntary Prepayment), the
Borrowers shall make the prepayment in accordance with the terms of that
notice.
(e) Any
principal amount of the Loan prepaid under this Section 2.07A (Voluntary Prepayment) may not
be re-borrowed.
Section
2.07B. Mandatory
Prepayment Without prejudice to Section 2.11 (Increased Costs), Section
2.15 (Taxes), Section
2.17 (Illegality of
Participation) and Section 5.05 (Insurance
Covenants):
(a) If
a Borrower prepays any other long-term loans other than a Shareholder Loan
allowed to be prepaid hereunder, IFC shall have the right to require prepayment
of the Loan, on a pro-rata basis to the other long-term loan(s) prepaid, provided that if the pro rata
prepayment for the Loan would be less than $2,000,000 the Borrowers shall prepay
the Loan in an amount of two million Dollars ($2,000,000).
(b) Except
for the prepayment or repayment of Shareholder Loans with the proceeds of the
first and second Disbursement of the Loan, if the Guarantor before June 15, 2012
(i) declares or pays dividends, repays or prepays other Shareholder
Loans in addition to those that the Borrower is allowed to pay as per the
foregoing, or makes loans, advances, deposits (except commercial bank deposits
and other deposits and escrows made in the ordinary course of business or
operations for the purchase of assets or equipment) with or investments in other
Persons (including Ultrapetrol) except investments in the Guarantor or any
Guarantor Subsidiary, and (ii) the cumulative contribution from internal cash
generation, Shareholder Loans or equity from January 1, 2007 to date of
calculation is less than US$150 million, IFC shall have the right to require the
Borrowers to prepay an amount of the Loan equal to the amount in (b)(i)
above.
41
(c) Prepayment
under this Section 2.07B (Mandatory Prepayment) shall
not be subject to a prepayment premium and will be applied by IFC pro-rata to
the remaining repayment installments of the Loan.
(d) Any
principal amount of the Loan prepaid under this Section 2.07B (Mandatory Prepayment) may not
be re-borrowed.
Section 2.08. Fees. (a) The
Borrowers shall pay to IFC a commitment fee:
|
(i)
|
at
the rate of one-half of one per cent (½ %) per annum on that part of the
Loan that from time to time has not been disbursed or canceled, beginning
to accrue on the date of this
Agreement;
|
|
(ii)
|
pro rated on the
basis of a 360-day year for the actual number of days elapsed;
and
|
|
(iii)
|
payable
semi-annually, in arrears, on each Interest Payment Date, the first such
payment to be due on December 15,
2008.
|
(b) The
Borrowers shall also pay to IFC:
|
(i)
|
a
front-end fee on the Loan of $525,000, to be paid on the earlier of (x)
the date which is thirty (30) days after the date of this Agreement and
(y) the date immediately preceding the date of the first
Disbursement;
|
|
(ii)
|
an
arranger fee of one-half of one per cent (0.5%) of the amount of the
Parallel Loan, to be paid on or before the date the Parallel Loan
Agreement is executed;
and
|
42
|
(iii)
|
if
the Borrowers and IFC agree to restructure all or part of the Loan, the
Borrowers and IFC shall negotiate in good faith an appropriate amount to
compensate IFC for the additional work of IFC staff required in connection
with such restructuring.
|
Section
2.09. Currency
and Place of Payments. (a) The Borrowers shall make
all payments of principal, interest, fees, and any other amount due to IFC under
this Agreement in Dollars, in same day funds, to the account of IFC at Citibank,
N.A., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, X.X.X., ABA#000000000 for credit to
IFC's account number 00000000, or at such other bank or account in New York as
IFC from time to time designates. Payments must be received in IFC's
designated account no later than 1:00 p.m. New York time; and the Borrowers
hereby irrevocably agree that IFC may deem any payment, or part thereof, that is
received after that time as made on the next Business Day and accordingly
interest will continue to accrue thereon.
(b) The
tender or payment of any amount payable under this Agreement (whether or not by
recovery under a judgment) in any currency other than Dollars shall not novate,
discharge or satisfy the obligation of the Borrowers to pay in Dollars all
amounts payable under this Agreement except to the extent that (and as of the
date when) IFC actually receives funds in Dollars in the account specified in,
or pursuant to, Section 2.09 (a) (Currency and Place of
Payments).
(c) The
Borrowers shall indemnify IFC against any losses resulting from a payment being
received or an order or judgment being given under this Agreement in any
currency other than Dollars or any place other than the account specified in, or
pursuant to, Section 2.09 (a) (Currency and Place of
Payments). The Borrowers shall, as a separate obligation, pay such
additional amount as is necessary to enable IFC to receive, after conversion to
Dollars at a market rate and transfer to that account, the full amount due to
IFC under this Agreement in Dollars and in the account specified in, or pursuant
to, Section 2.09 (a) (Currency
and Place of Payments).
(d) Notwithstanding
the provisions of Section 2.09 (a) and Section 2.09 (b) (Currency and Place of
Payments), IFC may require the Borrowers to pay (or reimburse IFC) for
any Taxes, fees, costs, expenses and other amounts payable under Section 2.15
(a) (Taxes) and Section
2.16 (Expenses) in the
currency in which they are payable, if other than
Dollars.
43
Section
2.10. Allocation
of Partial Payments. If at any time IFC receives less than the
full amount then due and payable to it under this Agreement, IFC may allocate
and apply the amount received in any way or manner and for such purpose or
purposes under this Agreement as IFC in its sole discretion determines,
notwithstanding any instruction that the Borrowers may give to the
contrary.
Section
2.11. Increased
Costs. On each Interest Payment Date, the Borrowers shall pay,
in addition to interest, the amount which IFC from time to time notifies to the
Borrowers in an Increased Costs Certificate as being the aggregate Increased
Costs of IFC accrued and unpaid prior to that Interest Payment
Date.
Section 2.12. Unwinding
Costs. (a) If IFC incurs any cost, expense or loss
as a result of the Borrowers:
|
(i)
|
failing
to borrow in accordance with a request for Disbursement made pursuant to
Section 2.02 (Disbursement
Procedure);
|
|
(ii)
|
failing
to prepay in accordance with a notice of
prepayment;
|
|
(iii)
|
prepaying
all or any portion of the Loan on a date other than an Interest Payment
Date; or
|
|
(iv)
|
after
acceleration of the Loan, paying all or a portion of the Loan on a date
other than an Interest Payment
Date;
|
then the
Borrowers shall immediately pay to IFC the amount that IFC from time to time
notifies to the Borrowers as being the amount of those costs, expenses and
losses incurred.
(b) For
the purposes of this Section, "costs, expenses or losses" include any premium,
penalty or expense incurred to liquidate or obtain third party deposits,
borrowings, xxxxxx or swaps in order to make, maintain, fund or hedge all or any
part of any Disbursement or prepayment of the Loan, or any payment of all or
part of the Loan upon acceleration.
44
Section 2.13. Suspension
or Cancellation by IFC. (a) IFC may, by notice to
the Borrowers, suspend the right of the Borrowers to Disbursements or cancel the
undisbursed portion of the Loan in whole or in part:
|
(i)
|
if
the first Disbursement has not been made by March 31, 2009, or such other
date as the parties agree;
|
|
(ii)
|
if
any Event of Default has occurred and is continuing or if the Event of
Default specified in Section 6.02 (f) (Events of Default) is,
in the reasonable opinion of IFC,
imminent;
|
|
(iii)
|
if
any event or condition has occurred which has or can be reasonably
expected to have a Material Adverse Effect;
or
|
(iv) on
or after December 31, 2011.
(b) Upon
the giving of any such notice, the right of the Borrowers to any further
Disbursement shall be suspended or canceled, as the case may be. The exercise by
IFC of its right of suspension shall not preclude IFC from exercising its right
of cancellation, either for the same or any other reason specified in Section
2.13 (a) (Suspension or
Cancellation by IFC) and shall not limit any other provision of this
Agreement. Upon any cancellation the Borrowers shall, subject to paragraph (c)
of this Section 2.13 (Suspension or Cancellation by
IFC), pay to IFC all fees and other amounts accrued (whether or not then
due and payable) under this Agreement up to the date of that
cancellation.
(c) In
the case of partial cancellation of the Loan pursuant to paragraph (a) of this
Section 2.13 (Suspension or
Cancellation by IFC), or Section 2.14 (a) (Cancellation by the
Borrowers), interest on the amount then outstanding of the Loan remains
payable as provided in Section 2.03 (Interest).
Section
2.14. Cancellation
by the Borrowers. (a) The Borrowers may, by notice to
IFC,
irrevocably request IFC to cancel the undisbursed portion of the Loan on the
date specified in that notice (which shall be a date not earlier than thirty
(30) days after the date of that notice).
(b) IFC
shall, by notice to the Borrowers, cancel the undisbursed portion of the Loan
effective as of that specified date if:
|
(i)
|
subject
to Section 2.13 (c) (Suspension or Cancellation by
IFC), IFC has received all fees and other amounts accrued (whether
or not then due and payable) under this Agreement up to such specified
date; and
|
45
|
(ii)
|
any
amount of the Loan is then outstanding, IFC is reasonably satisfied that
the Borrowers have sufficient long-term funding available, on terms
satisfactory to IFC to generate sufficient cash flow to pay and repay all
amounts payable under this
Agreement.
|
(c) Any
portion of the Loan that is cancelled under this Section 2.14 (Cancellation by the
Borrowers) may not be reinstated or disbursed.
Section
2.15. Taxes. (a) The
Borrowers shall pay or cause to be paid all Taxes (other than taxes, if any,
payable on the overall income of IFC) on or in connection with the payment
of any and all amounts due under this Agreement that are now or in the future
levied or imposed by any Authority of the relevant Country or by any
organization of which the relevant Country is a member or any jurisdiction
through or out of which a payment is made.
(b) All
payments of principal, interest, fees and other amounts due under this Agreement
shall be made without deduction for or on account of any Taxes.
(c) If
the Borrowers are prevented by operation of law or otherwise from making or
causing to be made those payments without deduction, the principal or (as the
case may be) interest, fees or other amounts due under this Agreement shall be
increased to such amount as may be necessary so that IFC receives the full
amount it would have received (taking into account any Taxes payable on amounts
payable by the Borrowers under this subsection) had those payments been made
without that deduction.
(d) If
Section 2.15 (c) (Taxes) applies and IFC so
requests, the Borrowers shall deliver to IFC official tax receipts evidencing
payment (or certified copies of them) within thirty (30) days of the date of
that request.
Section
2.16. Expenses. (a) The
Borrowers shall pay or, as the case may be, reimburse IFC or its assignees any
amount paid by them on account of, all taxes (including stamp taxes), duties,
fees or other charges payable on or in connection with the execution, issue,
delivery, registration or notarization of the Transaction Documents and any
other documents related to this Agreement or any other Transaction
Document.
46
(b) The
Borrowers shall pay to IFC or as IFC may direct:
|
(i)
|
the
reasonable fees and expenses of IFC's technical and market consultants and
the public accountants incurred in connection with the investment by IFC
provided for under this Agreement;
|
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(ii)
|
the
reasonable fees and expenses of IFC's New York, Panamanian, Liberian,
Paraguayan and Bahamanian counsels incurred in connection
with:
|
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(A)
|
the
preparation of the investment by IFC provided for under this Agreement and
any other Transaction Document;
|
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(B)
|
the
preparation and/or review, execution and, where appropriate, translation
and registration of the Transaction Documents and any other documents
related to them;
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(C)
|
the
giving of any legal opinions required by IFC under this Agreement and any
other Transaction Document;
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|
(D)
|
the
administration by IFC of the investment provided for in this Agreement or
otherwise in connection with any amendment, supplement or modification to,
or waiver under, any of the Transaction
Documents;
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|
(E)
|
the
registration (where appropriate) and the delivery of the evidences of
indebtedness relating to the Loan and its
disbursement;
|
|
(F)
|
the
occurrence of any Event of Default or Potential Event of
Default;
|
47
|
(G)
|
the
creation of additional IFC Security as needed to meet the relevant
Security Coverage Ratio requirement;
and
|
|
(H)
|
the
release of the IFC Security in whole or in part following repayment in
full or in part of the Loan in accordance with this
Agreement;
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(iii)
|
the
costs and expenses incurred by IFC in relation to efforts to enforce or
protect its rights under any Transaction Document, or the exercise of its
rights or powers consequent upon or arising out of the occurrence of any
Event of Default or Potential Event of Default, including legal and other
professional consultants' fees on a full indemnity
basis;
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(iv)
|
in
2009 and in each calendar year thereafter upon receipt of a statement from
IFC, the amount of fifteen thousand Dollars ($15,000) on
account of IFC's expenses in carrying out its supervision review of the
Borrowers of this Agreement and the UABLPY Loan Agreement and the Project
by IFC staff members, and/or consultants designated by
IFC;
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(v)
|
any
Taxes levied on or with respect to the proceeds of enforcement of any part
of the IFC Security; and
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(vi)
|
the
fees and expenses of the Security Trustee, including, without limitation,
all legal fees and expenses and other costs incurred by the Security
Trustee in connection with the performance and exercise of its rights,
powers, authorities, discretions and duties and other obligations under
the Transaction Documents, to which it is a
party.
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Section
2.17. Illegality
of Participation. If IFC has sold a participation in the Loan
and after the date of this Agreement, any change made in any applicable law or
regulation or official directive (or its interpretation or application by any
Authority charged with its administration) (herein the "Relevant Change") makes it
unlawful for the participant acquiring that participation to continue to
maintain or to fund that participation:
48
(a) the
Borrowers shall, upon request by IFC (but subject to any applicable
Authorization having been obtained), on the earlier of (x) the next Interest
Payment Date and (y) the date that IFC advises the Borrowers is the latest day
permitted by the Relevant Change, prepay in full that part of the Loan that IFC
advises corresponds to that participation;
(b) concurrently
with the prepayment of the part of the Loan corresponding to the participation
affected by the Relevant Change, the Borrowers shall pay all accrued interest,
Increased Costs (if any) on that part of the Loan (and, if that prepayment is
not made on an Interest Payment Date, any amount payable in respect of the
prepayment under Section 2.12 (Unwinding
Costs));
(c) the
Borrowers agree to take all reasonable steps to obtain, as quickly as possible
after receipt of IFC's request for prepayment, the Authorization referred to in
Section 2.17 (a) (Illegality
of Participation) if any such Authorization is then required;
and
(d) there
shall be no prepayment penalty resulting from a prepayment under this Section
2.17 (Illegality of
Participation).
ARTICLE
III
Representations
and Warranties
Section 3.01. Representations
and Warranties. The Borrowers represent and warrant
that:
(a) Organization and
Authority.
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(i)
|
Each
of UABLPN, UABLTS and Marine Financial, is a corporation duly
incorporated, validly existing and in good standing under the laws of the
Republic of Panama and is registered as a "foreign maritime entity" within
the meaning of Section 51(5)(c) of the Liberian Maritime Law and is in
good standing under the law of the Republic of
Liberia;
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(ii)
|
Eastham
Barges is a corporation duly incorporated, validly existing and in good
standing under the laws of the Republic of
Liberia;
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49
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(iii)
|
Each
Borrower is duly qualified and in good standing as a foreign corporation
in each other jurisdiction in which it owns or leases property or in which
the conduct of its business requires it to so qualify or be licensed,
except where failure to so qualify or be licensed would not result in a
Material Adverse Effect; and
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(iv)
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Each
Borrower has the corporate power and has obtained all required
Authorizations to own or lease and operate its assets, conduct its
business as presently conducted and as proposed to be conducted and to
enter into, and comply with its obligations under, the Transaction
Documents to which it is a party or will, in the case of any Transaction
Document not executed as at the date of this Agreement, when that
Transaction Document is executed, have the corporate power to enter into,
and comply with its obligations under, that Transaction
Document;
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(b) Validity. Each
Transaction Document to which a Borrower is a party has been, or will be, duly
authorized and executed by such Borrower and constitutes, or will when executed
constitute, a valid and legally binding obligation of such Borrower, enforceable
in accordance with its terms and none of the Project Documents has been, or will
be, amended or modified except as permitted under this Agreement;
(c) No
Conflict. Neither the making of any Transaction Document to
which a Borrower is a party nor (when all the Authorizations referred to in
Section
4.01(d) (Conditions of
Disbursement) have been obtained) the compliance with its terms will
conflict with or result in a breach of any of the terms, conditions or
provisions of, or constitute a default or require any consent under, any
indenture, mortgage, agreement or other instrument or arrangement to which such
Borrower is a party or by which it is bound, or violate any of the terms or
provisions of such Borrower's Constitutive Documents or any Authorization,
judgment, decree or order or any statute, rule or regulation applicable to such
Borrower;
(d) Status of
Authorizations. To the best of the Borrowers' knowledge, after
due inquiry:
50
|
(i)
|
the
Authorizations specified in Annex B are all the Authorizations (other than
Authorizations that are of a routine nature and are obtained in the
ordinary course of business) needed by each Borrower to conduct its
business, carry out the Project and execute, and comply with its
obligations under, this Agreement and each of the other Transaction
Documents to which it is or will be a
party;
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(ii)
|
all
Authorizations specified in Section (1) of Annex B have been obtained and
are in full force and effect;
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(iii)
|
except
as specified in Annex B, no notice to or filing, recording or registration
with, any Authority or any other Authorization is required for: (A) the
due execution, delivery and performance by the Borrowers of this Agreement
and each of the other Transaction Documents to which they are or will be a
party or for the consummation of the transactions contemplated thereby;
(B) the grant by a Borrower of any Lien granted or to be granted by it
pursuant to any Security Document to which it is or will be a party; or
(C) the perfection or maintenance of any such Lien (including the first
ranking nature thereof); and
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|
(iv)
|
except
for rights that can reasonably be expected to be obtained on commercially
reasonable terms at the time required, the Project Documents contain all
rights that are necessary for the conduct of the business of the Borrowers
as contemplated by the Transaction
Documents;
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(e) No Amendments to
Constitutive Documents. Each of the Borrowers Constitutive
Documents have not been amended since each Borrower was
incorporated;
(f)
No
Immunity. None of the Borrowers nor any of their property
enjoys any right of immunity from set-off, suit or execution with respect to
their assets or their obligations under any Transaction Document;
(g) Financial
Condition. Since June 30, 2008, none of the Borrowers
has:
51
|
(i)
|
suffered
any change that has a Material Adverse Effect or incurred any substantial
loss or liability; or
|
|
(ii)
|
undertaken
or agreed to undertake any substantial obligation other than as previously
advised to IFC in writing;
|
(h) Financial
Statements. The balance sheets of each of the Borrowers for
the period ending on December 31, 2007:
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(i)
|
have
been prepared in accordance with the Accounting Standards, and give a true
and fair view of the financial condition of each Borrower as of the date
as of which they were prepared and the results of such Borrower's
operations during the period then
ended;
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(ii)
|
disclose
all liabilities (contingent or otherwise) of the Borrowers, and the
reserves, if any, for such liabilities and all unrealized or anticipated
liabilities and losses arising from commitments entered into by the
Borrowers (whether or not such commitments have been disclosed in such
financial statements); and
|
|
(iii)
|
except
as set forth therein, the Borrowers have not incurred any Financial Debt
or any contractual commitment not in the ordinary course of its business
or any liabilities (contingent or otherwise) or losses except in relation
to the purchase of Vessels in connection with the
Project;
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(i)
Material
Agreements. None of the Borrowers is a party to, or committed
to enter into, any contract which would or might affect the judgment of a
prospective investor;
(j)
Title to Assets and
Liens.
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(i)
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Each
Borrower has good and marketable title to all of the assets purported to
be owned by it and possesses a valid leasehold interest in all assets
which it purports to lease, in all cases free and clear of all Liens, and
no contracts or arrangements, conditional or unconditional, exist for the
creation by each Borrower of any Lien, except for Permitted
Liens;
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52
|
(ii)
|
The
provisions of the Security Documents are effective to create, in favor of
the Security Trustee for the benefit of IFC, legal, valid and enforceable
Liens on or in all of the Collateral covered by the IFC Security;
and
|
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(iii)
|
all
recordings and filings have been or will be made in all public offices,
all necessary consents have been or will be obtained and all other action
has been or will be taken so that the Lien created by each Security
Document constitutes a perfected Lien on the Collateral with the priority
specified in the Security
Documents;
|
(k) Taxes. All
tax returns and reports of each Borrower required by law to be filed have been
duly filed and all Taxes, fines, obligations, fees and other governmental
charges upon each Borrower, or its properties, or its income or assets, which
are due and payable or to be withheld, have been paid or withheld, other than
those presently payable without penalty or interest in relation to which
adequate reserves have been made in accordance with the Accounting
Standards;
(l)
Litigation.
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(i)
|
No
Borrower is engaged in nor, to the best of its knowledge after due
inquiry, threatened by, any litigation, arbitration or administrative
proceeding, the outcome of which could reasonably
be expected to have a Material Adverse Effect;
and
|
|
(ii)
|
No
judgment or order has been issued which has or may reasonably be expected
to have a Material Adverse Effect;
|
(m) Compliance with
Law. To the best of the Borrowers' knowledge and belief after
due inquiry, none of the Borrowers is in violation of any statute or regulation
of any Authority;
53
(n) Environmental
Matters. To the best of the Borrowers' knowledge and belief,
after due inquiry, none of the Borrowers has received or is aware of either (i)
any existing or threatened complaint, order, directive, claim, citation or
notice from any Authority or (ii) any material written communication from any
Person concerning the Project's failure to comply with any matter covered by the
Applicable S&E law which failure has, or could reasonably be expected to
have, a Material Adverse Effect or a material adverse impact on the
implementation or operation of the Project in accordance with the Performance
Standards;
(o) Labor
Matters. There are no ongoing or, to the best knowledge of the
Borrowers after due inquiry, threatened, strikes, slowdowns or work stoppages by
employees of any Borrower or any contractor with respect to the
Project;
(p) Sanctionable
Practices. None of the Borrowers nor any of their Affiliates,
nor any Person acting on their behalf, has committed, with respect to the
Project or any transaction contemplated by this Agreement or any other
Transaction Document, any Sanctionable Practice;
(q) Principal Place of
Business. Each of the Borrowers has its principal place of
business and its chief executive office at Capital Plaza Building, 15th Floor,
Paseo Xxxxxxx Xxxxx, Costa del Esta, Panama, Republic of Panama;
and
(s) No Material
Omissions. No representation, warranty or statement made or
certificate, document or financial statement provided by the Borrowers in or
pursuant to this Agreement or any other Transaction Document, or in any other
document furnished in connection herewith or therewith is untrue or incomplete
in any material respect or contains any misrepresentation of a material fact or
omits any fact or matter necessary to make any such representation, warranty or
statement herein or therein not misleading.
Section
3.02. IFC
Reliance. The Borrowers acknowledge that they make the
representations and warranties in
Section 3.01 (Representations
and Warranties) with the intention of inducing IFC to enter into this
Agreement and that IFC enters into this Agreement on the basis of, and in full
reliance on, each of such representations and
warranties.
54
ARTICLE
IV
Conditions
of Disbursement
Section
4.01. Conditions
of Disbursement. The obligation of IFC to make a Disbursement
is subject to the fulfillment prior to or concurrently with the making of that
Disbursement of the following conditions:
(a) Transaction
Documents. The following Transaction Documents, each in form
and substance satisfactory to IFC, shall have been entered into by all parties
to them and have become (or, as the case may be, remain) unconditional and fully
effective in accordance with their respective terms (except for this Agreement
having become unconditional and fully effective, if that is a condition of any
of those agreements), and IFC shall have received a copy of each of those
agreements to which it is not a party:
(i)
In respect of the first Disbursement:
(A) this
Agreement;
(B) the
Guarantee Agreement;
|
(C)
|
each
of the Other Financing Documents, provided that execution
of (i) the Shareholder Loan Agreements shall not be required if there are
no Shareholder Loans in existence after the application of the proceeds of
such Disbursement and (ii) the Parallel Loan Documents and the
Intercreditor Agreement (if any) shall not be required if at the time of
the first Disbursement the Parallel Loan Agreement is not ready to be
executed;
|
|
(D)
|
each
of the documents described in paragraphs (b) and (c) in the definition of
the Project Documents and
any other Bareboat Charter of assets that are being financed by the
proceeds of such
Disbursement;
|
|
(E)
|
the
Debt Service Reserve Account
Pledge;
|
|
(F)
|
the
Share Pledge Agreement and the Share Retention
Agreement;
|
55
|
(G)
|
if
there are any Shareholder Loan Agreements, a Shareholder Loan Agreement
Assignment and a Shareholder Loan Agreement Assignment Acknowledgement and
Consent in respect of each such Shareholder Loan
Agreement;
|
|
(H)
|
the
Bareboat Charter Assignments and the Bareboat Charter Assignment
Acknowledgements and Consents in respect of all Vessels being mortgaged by
a Borrower pursuant to a Mortgage in connection with such
Disbursement;
|
|
(I)
|
the
Insurance Assignments and the Insurance Assignment Acknowledgments and
Consents in respect of all Vessels being mortgaged pursuant to a Mortgage
in connection with such Disbursement;
and
|
|
(J)
|
the
Mortgage(s) in respect of all Vessels being mortgaged pursuant to a
Mortgage in connection with such
Disbursement;
|
|
(ii)
|
In
respect of all Disbursements other than the first
Disbursement:
|
|
(A)
|
the
Parallel Loan Documents (if entered into) and the Intercreditor Agreement
(if any);
|
|
(B)
|
each
of the documents described in paragraphs (b) and (c) in the definition of
the Project Documents and any other Bareboat Charter of assets that are
being
financed by the proceeds of such
Disbursement;
|
|
(C)
|
if
there are any Shareholder Loan Agreements that have not been previously
assigned, a Shareholder Loan Agreement Assignment in respect of such
Shareholder Loan
Agreements;
|
56
|
(D)
|
the
Bareboat Charter Assignments and the Bareboat Charter Assignment
Acknowledgements and Consents in respect of all Vessels being mortgaged by
a Borrower pursuant to a Mortgage in connection with such
Disbursement;
|
|
(E)
|
the
Insurance Assignments and the Insurance Assignment Acknowledgments and
Consents in respect of all Vessels being mortgaged pursuant to a Mortgage
in connection with such Disbursement;
and
|
|
(F)
|
the
Mortgage(s) in respect of all Vessels being mortgaged pursuant to a
Mortgage in connection with such
Disbursement;
|
(b) Constitutive
Documents.
|
(i)
|
In
respect of the first Disbursement, each Borrower, the Guarantor, the
Bareboat Charterer and UABLPY shall have delivered to IFC a copy,
certified by an Authorized Representative, of such Person's Constitutive
Documents and all amendments thereto through the date of such
certification and IFC shall have determined, in its reasonable judgment,
that such Constitutive Documents are not inconsistent with the provisions
of any Transaction Document and do not have or may not reasonably be
expected to have a Material Adverse Effect;
and
|
|
(ii)
|
In
respect of all Disbursements other than the first Disbursement, an
Authorized Representative of each Borrower, the Guarantor, the Bareboat
Charterer and UABLPY shall have delivered to IFC a certification that
either
(A) there has been no amendment of such Person's Constitutive Documents
since the date of the first Disbursement, or (B) such Person's
Constitutive Documents have been amended and IFC shall have received a
copy of such amendment and determined, in its reasonable judgment, that
such Constitutive Documents, as amended, are not inconsistent with the
provisions of any Transaction Document and do not have or may not
reasonably be expected to have a Material Adverse
Effect;
|
57
(c) Security. The
IFC Security which is required to be created and perfected in connection with
the relevant Disbursement shall have been duly created and perfected as first
priority security interests in all Collateral and rights subject to the Security
Documents;
(d) Authorizations. Each
Borrower, the Guarantor, the Bareboat Charterer and UABLPY has obtained, and
provided to IFC, copies, certified by an Authorized Representative, of all
Authorizations listed in Annex B, and such other Authorizations not listed in
Annex B that may become necessary for:
|
(i)
|
The
Loan;
|
|
(ii)
|
The
business of each such Person as it is presently carried on and is
contemplated to be carried on;
|
|
(iii)
|
The
Project and the implementation of the Financial
Plan;
|
|
(iv)
|
The
due execution, delivery, validity and enforceability of, and performance
by each such Person of its obligations under, this Agreement and the other
Transaction Documents, and any other documents necessary or desirable for
the implementation of any of those agreements or documents;
and
|
|
(v)
|
The
remittance to IFC or its assigns in Dollars of all monies payable with
respect to the Transaction
Documents;
|
and all
those Authorizations shall be in full force and effect;
(e) Legal
Opinions. IFC shall have received such legal opinions, in form
and substance satisfactory to IFC, with respect to any matters relating to the
relevant Disbursement and such other matters relating to the transactions
contemplated by this Agreement as IFC may reasonably request, from:
|
(i)
|
IFC's
special counsels in New York (including as to matters of Liberian law as
applicable), Panama, Paraguay, The Bahamas and any other
jurisdiction which IFC may reasonably determine is appropriate (including
without limitation the jurisdiction of incorporation of any Bareboat
Charterer); and
|
58
|
(ii)
|
Counsel
for the Borrowers, the Guarantor or, as applicable, the relevant Bareboat
Charterer, concurring (other than in the case of New York and Liberian
law) with the opinions of IFC's special
counsels;
|
(f)
Financial
Certifications.
|
(i)
|
The
Borrowers shall have provided IFC with satisfactory evidence that, as of
the last audited financial statements of the Guarantor, the Guarantor is
in compliance with the provisions of Section 6.01 (c) (Affirmative Covenants)
of the Guarantee Agreement; and
|
|
(ii)
|
IFC
shall have received a certification from an Authorized Representative of
each Borrower, confirmed by the CFO of the Guarantor, that, as on a date
within sixty (60) days prior to the date of the first Disbursement, each
Borrower is in compliance with the provisions of Section 5.01 (d) (Affirmative
Covenants);
|
(g) Insurance. IFC
shall have received in respect of all Vessels being mortgaged by a Borrower
pursuant to a Mortgage in connection with such Disbursement:
|
(i)
|
Copies,
certified by an Authorized Representative of the relevant Borrowers of all
cover notes and certificates of entry in respect of all insurance policies
required to be obtained
pursuant to Section 5.05 (Insurance Covenants)
and Annex C;
|
|
(ii)
|
A
certification of the insurers or insurance brokers confirming that such
policies are in full force and effect and all premiums then due and
payable under those policies have been paid;
and
|
59
|
(iii)
|
An
opinion in form and substance satisfactory to IFC from an independent
marine insurance broker as to such matters as IFC may request regarding
the insurances effected or proposed to be effected as required by Section
5.05 (Insurance
Covenants) and Annex C;
|
(h) Fees. IFC
shall have received the fees which Section 2.08 (Fees) requires to be paid
before the date of the relevant Disbursement;
(i)
Legal Fees and
Expenses. IFC shall have received reimbursement of all
invoiced fees and expenses of IFC's counsel as provided in Section 2.16 (b)
(Expenses) (ii) or
confirmation that those fees and expenses have been paid directly to that
counsel;
(j)
Authorization of
Auditors. IFC shall have received a copy of a valid
authorization to the Auditors referred to in Section 5.01(e) (Affirmative
Covenants);
(k) Incumbency. IFC
shall have received from each Borrower, the Guarantor and any Bareboat Charterer
executing a Transaction Document in connection with such Disbursement a valid
Certificate of Incumbency and Authority in the form of Schedule 1 hereto duly
executed by an Authorized Representative of such party;
(l)
Appointment of
Agent. In respect of the first Disbursement only, each
Borrower and the Guarantor shall have delivered to IFC valid evidence,
substantially in the form of Schedule 4, of acceptance of the appointment of an
agent for service of process pursuant to Section 7.05 (Applicable Law and
Jurisdiction) and such appointment shall be valid until at least 3 months
after repayment of the Loan;
(m) Environmental
Matters.
|
(i)
|
The
Guarantor shall have delivered to IFC the Action Plan, in form and
substance acceptable to IFC;
|
|
(ii)
|
The
Guarantor's existing EH&S Management System shall be acceptable to
IFC; and
|
60
|
(iii)
|
IFC
shall have received a certificate from an Authorized Representative of the
Guarantor that the Borrowers, the Guarantor, and all other Guarantor
Subsidiaries are in compliance with all environmental and social
requirements;
|
(n) No
Default. IFC shall have received a certificate from an
Authorized Representative of each Borrower and the Guarantor that no Event of
Default and no Potential Event of Default has occurred and is
continuing;
(o) Use of
Proceeds. IFC shall have received a certificate from an
Authorized Representative of each Borrower that the proceeds of that
Disbursement:
|
(i)
|
are,
at the date of the relevant request, needed by the Borrowers for the
purpose of the Project, or will be needed for that purpose within three
(3) months of that date, or are for the repayment of Shareholder Loans
outstanding as of the date of the Disbursement (in which case IFC shall
have received copies of the most recently published financial statements
evidencing such Shareholder Loan(s) certified by an Authorized
Representative of the relevant Borrower and the amount outstanding is
confirmed by the Guarantor's chief financial officer as of the date of
Disbursement); and
|
|
(ii)
|
are
not in reimbursement of, or to be used for, expenditures in the
territories of any country that is not a member of the World Bank or for
goods produced in or services supplied from any such
country;
|
(p) No Material Adverse
Effect. IFC shall have received a certificate from an
Authorized Representative of each Borrower and the Guarantor that since
the date
of this Agreement nothing has occurred which has or can reasonably be expected
to have a Material Adverse Effect;
(q) No Material Loss or
Liability. IFC shall have received a certificate from an
Authorized Representative of each Borrower and the Guarantor that since the date
of this Agreement none of the Borrowers, the Guarantor or any other Guarantor
Subsidiary has incurred any material loss or liability (except such liabilities
as may be incurred in accordance with Section 5.02 (Negative
Covenants));
61
(r)
Representations and
Warranties. IFC shall have received a certificate from an
Authorized Representative of each Borrower and the Guarantor that the
representations and warranties made in Article III of this Agreement and Article
V of the Guarantee Agreement are true and correct in all material respects on
and as of the date of that Disbursement with the same effect as if those
representations and warranties had been made on and as of the date of that
Disbursement;
(s) No
Violations. IFC shall have received a certificate from an
Authorized Representative of each Borrower and the Guarantor that after giving
effect to that Disbursement, none of Borrowers or the Guarantor would be in
violation of:
|
(i)
|
its
Constitutive Documents;
|
|
(ii)
|
any
provision contained in any document to which such Person is a party
(including this Agreement) or by which such Person is bound;
or
|
|
(iii)
|
any
law, rule, regulation, Authorization or agreement or other document
binding on such Person directly or indirectly limiting or otherwise
restricting such Person's borrowing power or authority or its ability to
borrow or ability to guarantee, as the case may
be;
|
(t) Financial
Ratios. IFC shall have received a certificate from an
Authorized Representative of the Guarantor certifying that its Historical Debt
Service Coverage Ratio, calculated on a Consolidated Basis, is not less than
1.3;
(u) Pro-Rata
Disbursement. The Disbursement is made pro rata with the
disbursement of the loans provided for in the UABLPY Loan Agreement and, if
executed, the Parallel Loan Agreement;
(v) Debt Service Reserve
Account. In respect of the first Disbursement only, IFC shall
have received evidence satisfactory to it of the establishment of the Debt
Service Reserve Account and with respect to all Disbursements that the Borrowers
have funded the Debt Service Reserve Account as required by Section 5.01 (j)
(Affirmative Covenants)
up to the date of the such Disbursement;
62
(w) Goodstanding. IFC
shall have received a copy of a certificate of goodstanding of each of the
Borrowers and the Guarantor issued by its respective jurisdiction of
incorporation, and in the case of each of UABLPN, UABL Towing and Marine
Financial, a certificate of goodstanding as a foreign maritime entity issued by
the Republic of Liberia, each dated as of a date reasonably near the date of
such Disbursement, certifying that such Person is duly incorporated and in
goodstanding under the laws of its jurisdiction of incorporation (and in the
case of each of UABLPN, UABL Towing and Marine Financial, as a "foreign maritime
entity" in good standing within the meaning of Section 51(5)(c) of the Liberian
Maritime Law);
(x) Fair Market Value; Security
Coverage Ratio.
|
(i)
|
IFC
shall have received a valuation of the Fair Market Value of each Mortgaged
Vessel on or before the date of such Disbursement of the Loan;
and
|
|
(ii)
|
After
giving effect to such Disbursement the Security Coverage Ratio at the date
of the relevant Disbursement shall be not less than 1.3 unless the
Disbursement is made within one year of the final maturity date of the
Notes, in which case the Security Coverage Ratio at the date of the
relevant Disbursement shall be not less than 1.6;
and
|
(y) Liberian Flag Registration
and Paraguayan Registry. With respect to each Mortgaged Vessel
being financed by the relevant Disbursement IFC shall have received in form and
substance satisfactory to it:
|
(i)
|
A
copy of the Certificate of Ownership and Encumbrance relating to that
Mortgaged Vessel issued by the
Deputy Commissioner's Office and evidencing the registration of (A) title
to such Vessel in the name of a Borrower and (B) the Mortgage in respect
of such Mortgaged Vessel;
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|
(ii)
|
A
copy, certified as true by an Authorized Representative of the relevant
Borrower, of the Bareboat Charter between such Borrower and Cornamusa for
such Mortgaged Vessel which shall have been entered into by all parties
thereto and shall have become unconditional and fully effective in
accordance with its terms;
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63
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(iii)
|
A
copy, certified as true by an Authorized Representative of Cornamusa, of
any bareboat charter party (or lease) between Cornamusa and UABLPY
providing for the sub-demise charter by Cornamusa of Mortgaged Vessels
owned by a Borrower to UABLPY which shall have been entered into by all
parties thereto and shall have become unconditional and fully effective in
accordance with its terms;
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|
(iv)
|
A
copy of the certificate issued by the Deputy Commissioner's Office
authorizing the bareboat registration of such Mortgaged Vessel under the
Paraguayan flag; and
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|
(v)
|
A
copy, certified as true by an Authorized Representative of the relevant
Borrower, of the registration of such Mortgaged Vessel under the
Paraguayan flag.
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Section 4.02. Borrower's
Certification. The Borrowers shall deliver to IFC with respect
to each request for Disbursement:
(a) certifications,
in the form included in Schedule 2; and
(b) such
evidence as IFC may reasonably request of the proposed utilization of the
proceeds of that Disbursement or the utilization of the proceeds of any prior
Disbursement.
Section 4.03. Conditions
for IFC Benefit. The conditions in Section 4.01 (Conditions of Disbursement)
and Section 4.02 (Borrower's
Certification) are for the benefit of IFC and may be waived only by IFC
in its sole discretion.
64
ARTICLE
V
Particular
Covenants
Section 5.01. Affirmative
Covenants. At all times during the Security Period, unless IFC
otherwise agrees, each Borrower shall:
(a) Corporate Existence; Conduct
of Business. Maintain its corporate existence, comply with its
Constitutive Documents, and implement the Project and conduct its business with
due diligence and efficiency and in accordance with sound operating, financial
and business practices;
(b) Use of
Proceeds. Cause the financing specified in the Financial Plan
to be applied exclusively to the Project;
(b) Compliance with
Laws; Taxes:
|
(i)
|
conduct
its business in compliance, in all material respects, with all applicable
requirements of law; and
|
|
(ii)
|
file
by the date due all returns, reports and filings in respect of Taxes
required to be filed by it and pay, when due, all Taxes due and payable by
it;
|
(d) Accounting and Financial
Management. Maintain an accounting and control system,
management information system and books of account and other records, which
together adequately give a fair and true view of the financial condition of such
Borrower and the results of its operations in conformity with the Accounting
Standards;
(e) Auditors. Ensure
that the Auditors include the accounts of the Borrowers as part of the auditing
process for the Guarantor, irrevocably authorize, in the form of Schedule 5, the
Auditors (whose fees and expenses shall be for the account of the Borrowers) to
communicate directly with IFC at any time regarding each Borrower's financial
statements (both audited and unaudited), accounts and operations, and provide to
IFC a copy of that authorization and no later than thirty (30) days after any
change in Auditors, issue a similar authorization to the new Auditors and
provide a copy thereof to IFC;
65
(f) Access. Upon
IFC's request, and with reasonable prior notice to such Borrower, permit
representatives of IFC and the CAO, during normal office hours, to:
|
(i)
|
visit
any of the sites and premises where the business of such Borrower is
conducted;
|
|
(ii)
|
inspect
any of such Borrower's sites, facilities, plants and
equipment;
|
|
(iii)
|
have
access to such Borrower's books of account and all records;
and
|
|
(iv)
|
have
access to those employees, agents, contractors and subcontractors of such
Borrower who have or may have knowledge of matters with respect to which
IFC seeks information;
|
provided
that (i) no such reasonable prior notice shall be necessary if an Event of
Default or Potential Event of Default is continuing or if special circumstances
so require and (ii) in the case of the CAO, such access shall be for the purpose
of carrying out the CAO's Role;
(g) Environmental
Matters.
|
(i)
|
Action Plan and
Performance Standards. Ensure that the design,
construction, operation, maintenance, management and monitoring of the
Project's sites, plants, equipment, operations and facilities are
undertaken in compliance with (A) the Action Plan and (B) the applicable
requirements of the Performance
Standards;
|
|
(ii)
|
Environmental, Health
and Safety Management System. Ensure the continuing
operation of the Guarantor's existing EH&S
Management System to assess and manage the social and environmental
performance of their operations in conformity with the standards of
conduct known as the Responsible Carrier Program as applicable having
regard to (A) conditions in, and laws and regulations of the countries in
which the Borrowers' operations are conducted, (B) the Performance
Standards and (C) Applicable S&E Law;
and
|
66
|
(iii)
|
Performance Standards
and Applicable S&E Law. Ensure compliance with the
Performance Standards and Applicable S&E Law; and require that its
agents, contractors and subcontractors follow the Guarantor's
environmental, social, health and safety procedures in accordance to the
services being performed;
|
|
(h)
|
Authorizations.
|
|
(i)
|
Obtain
and maintain in force (and where appropriate, renew in a timely manner)
all Authorizations, including without limitation the Authorizations
specified in Annex B, which are necessary for the implementation of the
Project, the carrying out of such Borrower's business and operations
generally and the compliance by such Borrower with all its obligations
under the Transaction Documents;
and
|
|
(ii)
|
Comply
with all the conditions and restrictions contained in, or imposed on such
Borrower by, those Authorizations;
|
(i)
Security Coverage
Ratio; Further Assurances.
(i)
Maintain a Security Coverage Ratio of not less than:
|
(A)
|
1.3
at all times during the period between date of the first Disbursement of
the Loan and the date which is one year prior to the final maturity date
of the Notes; and
|
|
(B)
|
at
all times thereafter 1.6,
|
provided that in the event
that the Security Coverage Ratio exceeds 1.6 at any time, the Borrowers shall
have the right to request that IFC consent to the release of Collateral in
excess of 1.6, and IFC's consent to such release shall not be unreasonably
withheld or delayed to the extent such release is possible and can be effected
without prejudice to the Liens created by the Security Documents over the
remaining Collateral;
67
|
(ii)
|
Provide
additional Collateral and enter into such Security Documents to create and
perfect Liens to enable the Borrowers to comply with the relevant Security
Coverage Ratio and their other obligations under the Transaction
Documents;
|
|
(iii)
|
Enter
into such Security Documents to create and perfect additional Liens in
respect of any Bareboat Charter or Shareholder Loan Agreement entered into
after the date of this Agreement;
and
|
|
(iv)
|
From
time to time, execute, acknowledge and deliver or cause to be executed,
acknowledged and delivered such further instruments and opinions as may
reasonably be requested by IFC for perfecting or maintaining in full force
and effect the IFC Security or for re-registering the IFC Security or
otherwise;
|
(j)
Debt Service Reserve
Account. Maintain a balance in the Debt Service Reserve
Account of not less than the aggregate amount necessary to pay Debt
Service;
(k) Ownership of Guarantor and
Borrowers. Ensure that (i) Ultrapetrol and the Shareholders
maintain a controlling, majority, direct or indirect shareholding in the
Guarantor and (ii) the Guarantor maintains a controlling, majority, direct or
indirect shareholding in each Borrower;
(l)
Barges Manufactured by
Ultrapetrol. Ensure the agreements between any Borrower and
Ultrapetrol providing for the purchase of barges manufactured by Ultrapetrol are
acceptable to IFC, if and when executed and on an ongoing
basis;
(m) Shareholder Loan
Agreement. Before the making of any Shareholder Loan, enter
into a Shareholder Loan Agreement in form and substance satisfactory to IFC;
and
68
(n) Parallel Loan
Agreement. If at any time the Parallel Loan Documents have the
benefit of any provision that is more favorable to similar provisions in this
Loan Agreement or other Transaction Documents, then if IFC so requests, this
Loan Agreement and the Transaction Documents shall be amended or supplemented to
incorporate such more favorable provision.
Section 5.02. Negative
Covenants. At all times during the Security Period, unless IFC
otherwise agrees, each Borrower shall not:
(a) Distributions. Declare
or pay any dividend or make any cash distribution on its capital stock
(including dividends or distributions payable in stock of such Borrower), or
purchase, redeem or otherwise acquire any stock of such Borrower or any option
over them or make a payment under any subordinated Financial Debt or Shareholder
Loans unless:
|
(i)
|
in
case of dividends, the proposed payment or distribution is out of retained
earnings or out of any other reserves legally created for such purpose;
provided that the
sum of the retained earnings and such reserves is not less than zero after
giving effect to such payment; and
|
|
(ii)
|
before
and after giving effect to any such action no Event of Default or
Potential Event of Default has occurred and is
continuing;
|
(b) Capital
Expenditures. Incur capital expenditures or commitments for
expenditures for fixed or other non-current assets, other than those required
for carrying out the Project or necessary for repairs, replacements and
maintenance of satisfactory operating conditions for such Borrower's business or
operations, provided
that it is understood and agreed that IFC waives the Borrowers'
compliance with this paragraph (b) at all times during which the Security
Coverage Ratio exceeds 1.6;
(c) Permitted Financial
Debt. Incur, assume or permit to exist any Financial Debt
except:
|
(i)
|
the
Loan; and
|
|
(ii)
|
subordinated
Financial Debt or Shareholder
Loans;
|
69
(d) Leases. Enter,
as lessor or lessee, into any agreement or arrangement to lease any property or
equipment of any kind, except entering into leases (including the Bareboat
Charters) as lessor to the Guarantor or other Guarantor
Subsidiaries;
(e) Derivative
Transactions. Enter into any Derivative Transaction, except
hedging arrangements for fuel, currency and interest rate risk in the ordinary
course of business, or assume the obligations of any party to any Derivative
Transaction;
(f) Guarantees and Other
Obligations. Enter into any agreement or arrangement to
guarantee or, in any way or under any condition, assume or become obligated for
all or any part of any financial or other obligation of another
Person;
(g) Liens. Create
or permit to exist any Lien on any of its properties, revenues or other assets,
present or future, except for Permitted Liens, provided that it is understood
and agreed that IFC waives the Borrowers' compliance with this paragraph (g) at
all times during which the Security Coverage Ratio exceeds 1.6;
(h) Arm's Length
Transactions. Enter into any transaction except in the
ordinary course of business on the basis of arm's-length arrangements
(including, without limitation, transactions whereby such Borrower might pay
more than the ordinary commercial price for any purchase or might receive less
than the full ex-works commercial price (subject to normal trade discounts) for
its products);
(i) Profit Sharing
Arrangements. Enter into any partnership, profit-sharing or
royalty agreement or other similar arrangement whereby such Borrower's income or
profits are, or might be, shared with any other Person, except with other
Guarantor Subsidiaries wholly-owned by the Guarantor, provided that towage agreement
whereby remuneration is based on a percentage of freight earned shall not be
deemed profit-sharing;
(j) Management
Contracts. Enter into any management contract or similar
arrangement whereby its business or operations are managed by any other Person,
other than technical vessel management agreements;
(k) Subsidiaries. Form
or have any Subsidiary;
70
(l)
Permitted
Investments. Make or permit to exist loans or advances to, or
deposits (except commercial bank deposits and other deposits and escrows made in
the ordinary course of business or operations for the purchase of assets or
equipment) with, other Persons or investments in any Person, except to the
Guarantor unless after giving effect to the incurrence of such loans, advances
or deposits, no Event of Default or Potential Event of Default is caused or is
continuing;
(m) Fundamental
Changes. Change:
|
(i)
|
its
Constitutive Documents in any manner which would be inconsistent with the
provisions of any Transaction
Document;
|
|
(ii)
|
its
Financial Year; or
|
|
(iii)
|
the
nature or scope of the Project;
|
(n) Asset
Sales.
|
(i)
|
Sell,
transfer, lease or otherwise dispose of all or a substantial part of its
assets, other than inventory, whether in a single transaction or in a
series of transactions, related or otherwise;
or
|
|
(ii)
|
Sell,
transfer, lease or otherwise dispose of any Mortgaged Vessel or equipment
thereon unless such Mortgaged Vessel or equipment is replaced by another
Vessel and/or equipment of substantially equivalent type, condition and
value in the reasonable discretion of IFC and subjected to a
Mortgage;
|
(o) Amendments, Waivers, etc.,
of Transaction Documents. Terminate, amend or grant any waiver
with respect to any provision of any of the Transaction Documents, except for
any changes to a Bareboat Charter or other lease agreement made in the ordinary
course of business and on the basis of arm's-length
transactions;
71
(p) Prepayment of Long-Term
Debt. Prepay (whether voluntarily or involuntarily) or
repurchase any Long-term Debt (other than the Loan) pursuant to any provision of
any agreement or note with respect to that Long-term Debt unless:
|
(i)
|
that
Long-term Debt is refinanced using new Long-term Debt on terms and
conditions (as to interest rate, other costs and tenor) at least as
favorable to such Borrower as those of the Long-term Debt being
refinanced; or
|
|
(ii)
|
the
Borrowers give IFC at least thirty (30) days' advance notice of its
intention to make the proposed prepayment and, if IFC so requires, the
Borrowers contemporaneously prepay a proportion of the Loan equivalent to
the proportion of the part of the Long-term Debt being prepaid, such
prepayment to be made in accordance with the provisions of Section 2.07B
(Mandatory
Prepayment);
|
(q) Use of
Proceeds. Use the proceeds of any Disbursement in the
territories of any country that is not a member of the World Bank or for
reimbursements of expenditures in those territories or for goods produced in or
services supplied from any such country;
(r) Amendment of Action
Plan. The Borrowers shall not amend the Action Plan in any
material respect without the prior written consent of IFC; or
(s) Sanctionable
Practices. Engage in (and shall not authorize or permit any
Affiliate or any other Person acting on its behalf to engage in) with respect to
the Project or any transaction contemplated by this Agreement, any Sanctionable
Practice. The Borrowers further covenant that should IFC notify the
Borrowers of its concerns that there has been a violation of the provisions of
this Section or of Section 3.01(p) (Representations and
Warranties) of this Agreement, it shall cooperate in good faith with IFC
and its representatives in determining whether such a violation has occurred,
and shall respond promptly and in reasonable detail to any notice from IFC, and
shall furnish documentary support for such response upon IFC's
request.
Section
5.03. Reporting
Requirements. Unless IFC otherwise agrees, each Borrower
shall:
72
(a) Quarterly Financial
Statements and Reports. As soon as available but in any event
within forty-five (45) days after the end of each of the first, second and third
calendar quarters of each Financial Year, deliver to IFC:
|
(i)
|
two
(2) copies of such Borrower's complete unaudited financial statements for
such quarter prepared in accordance with the Accounting Standards,
certified by such Borrower's chief financial
officer;
|
|
(ii)
|
a
statement of all transactions between such Borrower and its Affiliates,
and a certification by an Authorized Representative of such Borrower that
all transactions entered into by such Borrower are on the basis of
arm's-length arrangements;
|
|
(iii)
|
a
statement of all charterhire or lease payment due or made for lease
arrangements or Bareboat Charters;
|
|
(iv)
|
a
report on any factors that have or could reasonably be expected to have a
Material Adverse Effect on such Borrower;
and
|
|
(v)
|
a
certificate from such Borrower confirming no claims from master and crew
on each Vessel owned by it;
|
(b) Annual Financial Statements
and Reports. As soon as available but in any event
within one hundred and twenty (120) days after the end of each Financial Year,
deliver to IFC:
|
(i)
|
two
(2) copies of its complete financial management accounts for such
Financial Year, all in form satisfactory to
IFC;
|
|
(ii)
|
a
statement by such Borrower of all transactions between such Borrower and
each of its Affiliates, if any, during that Financial Year, and a
certification by such Borrower's chief financial
officer that those transactions were on the basis of arm's-length
arrangements;
|
73
(c) Valuations. Within
60 days of the end of the Borrowers' Financial Year, deliver to IFC a valuation
of the aggregate Fair Market Value of the Mortgaged Vessels, provided that if the
Prospective Debt Service Coverage Ratio of the Guarantor is less than 1.5, IFC
may request at any time during the Financial Year additional valuations of the
aggregate Fair Market Value of the Mortgaged Vessels;
(d) Management
Letters. Deliver to IFC, promptly following receipt, a copy of
any management letter or other communication sent by the Auditors (or any other
accountants retained by a Borrower) to such Borrower or its management in
relation to such Borrower's financial, accounting and other systems, management
or accounts;
(e) Annual Monitoring
Report. Within ninety (90) days after the end of its Financial
Year, each Borrower shall deliver to IFC an Annual Monitoring Report in the form
attached as Schedule 8 confirming compliance with the Action Plan, the social
and environmental covenants set forth in Sections 5.01 (Affirmative Covenants) and
5.02 (Negative
Covenants) or, as the case may be, identifying any non-compliance or
failure, and the actions being taken to remedy it;
(f)
Notice of Accidents,
Etc. Within three (3) Business Days after its occurrence,
notify IFC of any social, labor, health and safety, security or environmental
incident, accident or circumstance having, or which could reasonably be expected
to have, a Material Adverse Effect or material adverse impact on the
implementation or operation of the Project in accordance with the Performance
Standards, specifying in each case the nature of the incident, accident, or
circumstance and any effect resulting or likely to result therefrom, and the
measures the Borrower is taking or plans to take to address them and to prevent
any future similar event; and keep IFC informed of the on-going implementation
of those measures and plans;
(g) Changes to Project; Material
Adverse Effect. Promptly notify IFC of any proposed change in
the nature or scope of the Project or the business or operations of such
Borrower and of any event or condition that has or may reasonably be expected to
have a Material Adverse Effect;
(h) Litigation,
Etc. Promptly upon becoming aware of any litigation of
administrative proceedings before any Authority or arbitral body which has or
may reasonably be expected to have a Material Adverse Effect, notify IFC by
facsimile of that event specifying the nature of that litigation or those
proceedings and the steps such Borrower is taking or proposes to take with
respect thereto;
74
(i)
Default. Promptly
upon the occurrence of an Event of Default or a Potential Event of Default,
notify IFC by facsimile specifying the nature of that Event of Default or
Potential Event of Default and any steps such Borrower is taking to remedy
it;
(j)
Insurance. Deliver
to IFC, in a timely manner, all insurance certificates, insurance reports and
such other insurance-related information as IFC may reasonably
request;
(k) Amendments to Bareboat
Charter or other lease arrangement. Deliver to IFC, in a
timely manner, a signed copy of any amendment made to the Bareboat Charter or
other lease arrangement as such is permitted to be made by Section 5.02 (o)
(Negative Covenants);
and
(l)
Other
Information. Promptly provide to IFC such other information as
IFC from time to time requests about each Borrower, its assets and the
Project.
Section 5.04. Shipping
Covenants. At all times during the Security Period, unless IFC
otherwise agrees, each Borrower shall:
(a) Ownership of Vessels;
Chartering.
|
(i)
|
Own
the entire legal and beneficial interest in each of the Vessels owned by
it;
|
|
(ii)
|
Not
let that Vessel on demise charter for any period, except to the Guarantor
or another Guarantor Subsidiary or
Cornamusa;
|
|
(iii)
|
Not
enter into any charter in relation to that Vessel under which more than 2
months' hire (or the equivalent) is payable
in advance, except in either case with IFC's prior written consent;
or
|
|
(iv)
|
Not
charter that Vessel otherwise than on bona fide arm's length terms at the
time when that Vessel is fixed;
|
75
(b) Employment of
Vessels.
|
(i)
|
Not
employ its Vessels in any way that might impair the value of IFC Security
or in any manner contrary to any law or official requirement in any
relevant jurisdiction;
|
|
(ii)
|
In
the event of hostilities in any part of the world (whether war is declared
or not), not cause or permit Vessels owned by it to enter or trade to any
zone which is declared a war zone by any government or by that Vessel's
war risks insurers unless the prior written consent of IFC has been given
and such Borrower has (at its expense) effected any special, additional or
modified insurance cover which the IFC may
require;
|
(c) Condition and Compliance
with Laws and Requirements of Insurers. Keep each Vessel owned
by it, or as the case may be, shall procure that the Bareboat Charterer or the
sub-bareboat charterer shall keep each Vessel owned by such
Borrower:
|
(i)
|
in
a good and safe condition and state of repairs so as to be consistent with
first-class ownership and management
practice;
|
|
(ii)
|
in
compliance with all laws and regulations applicable to vessels registered
at ports in the Parana-Paraguay River System or to vessels trading to any
jurisdiction to which the vessels may trade from time to time;
and
|
|
(iii)
|
in
compliance with the requirements of the
insurers;
|
(d) Registration.
(i)
Maintain the registration of each Vessel owned by it, the title of such Borrower
and the Mortgage in and under the laws of Liberia and other relevant
countries;
|
(ii)
|
Not
do or allow to be done anything as a result of which such registration
might be cancelled or imperiled;
and
|
76
|
(iii)
|
Not
change the flag or port of registry any Mortgaged Vessel (except for
Paraguayan registration as part of the
Project);
|
(e) Inspection and
Surveys.
|
(i)
|
Upon
reasonable notice to the Borrowers, permit IFC representatives ((by
surveyors or other persons appointed by it for that purpose, including
representatives of the CAO) to board any Vessels owned by it at all
reasonable times at the expense of the Borrowers, but without interrupting
the operation and trading of that Vessel, to inspect her condition and her
operating and insurance records or to satisfy themselves about proposed or
executed repairs and shall afford all proper facilities for such
inspections; and
|
|
(ii)
|
Submit
the Vessel or Vessels owned by it regularly to all periodical or other
surveys which may be required and, if so required by IFC, provide IFC with
copies of all survey reports and, if IFC shall so require, cause the
Vessels to be surveyed by a surveyor appointed by IFC; all costs arising
in connection with any such survey or surveys (including, but not without
limitation, the fees of the relevant surveyor or firm of surveyors
appointed by IFC to make such survey or surveys) shall be borne by the
Borrowers;
|
(f)
Prevention of and
Release from Arrest or Detention.
|
(i)
|
Promptly
discharge in so far as the same are due and
payable:
|
(A) all
liabilities which give or may give rise to maritime or possessory liens on or
claims enforceable against the Vessel or Vessels owned by it, or its earnings or
Insurances;
77
|
(B)
|
all
taxes, dues and other amounts charged in respect of the Vessel or Vessels
owned by it, or its earnings or Insurances;
and
|
|
(C)
|
all
other outgoings whatsoever in respect of the Vessel or Vessels owned by
it, or its earnings or Insurances;
|
|
(ii)
|
Forthwith
upon receiving notice of the arrest of the Vessel or Vessels owned by it,
or of her detention in exercise or purported exercise of any lien or
claim, procure her release by providing bail or otherwise as the
circumstances may require; and
|
|
(iii)
|
Immediately
notify IFC of any arrest or detention of any Vessel owned by it, and of
the steps taken to secure the
release;
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(g) Requisition and
Seizure. In the event of requisition or seizure by any
Authority of any Vessel owned by it, take all lawful steps as soon as possible
to recover possession;
(h) Information.
|
(i)
|
Promptly
provide IFC with any information which it may reasonably request
regarding:
|
|
(A)
|
amounts
due to the master and crew of the Vessel or Vessels owned by
it;
|
|
(B)
|
any
expenses incurred, or likely to be incurred, in connection with the
operation, maintenance or repair of the Vessel or Vessels owned by it and
any payments made in respect of that Vessel or Vessels;
and
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|
(C)
|
any
towages and salvages; and
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|
(ii)
|
Upon
IFC's request, give IFC information on any Vessel owned by it with respect
to employment, position, state of repair, copies of all charterparties and
other contracts of employment, and copies of deck and engine
logs;
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78
(i) Legal Proceedings and
Arbitration. Notify IFC immediately of any legal proceedings
or arbitration involving such Borrower or any Vessel owned by it (i) where a
claim exceeds $500,000 or (ii) the proceedings relate to any alleged or actual
breach of any Applicable S&E Law;
(j) Contracts. Perform
and enforce the performance by charterers and shippers of all agreements and
contracts relating to the Vessels owned by it; and
(k) No Material Changes; Removal
of Parts. Save as contemplated by the Project:
|
(i)
|
not
make any material change in the structure, type or speed of any Vessel
owned by it unless such change enhances the value of such
Vessel;
|
|
(ii)
|
not
remove any material part of, or any item of equipment installed on, any
Vessel owned by it unless (A) the removal does not reduce its Fair Market
Value, (B) that removal is required to comply with safety regulations, or
(C) the part or item so removed is forthwith replaced by a suitable part
or item which is in the same condition as or better condition than the
part or item removed, is free from any Lien or any right in favor of any
person other than the Security Trustee and becomes on installation on the
relevant Vessel the property of the relevant
Borrower;
|
provided that each Borrower
that owns a Vessel may install equipment owned by a third party if the equipment
can be removed without any risk of damage to such Vessel.
Section 5.05. Insurance
Covenants. Each Borrower undertakes with IFC to comply with
the following
provisions of this Section 5.05 (Insurance Covenants) at all
times during the Security Period except as IFC may otherwise
permit:
79
(a) Obligatory
Insurances. Each Borrower insure and keep insured, with
financially sound and reputable insurers, all its assets and business under
insurances as specified in Annex C and any insurance required by
law;
(b) Renewal of Obligatory
Insurances. Each Borrower that owns
a Mortgaged Vessel shall:
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(i)
|
at
least 21 days before the expiry of any obligatory insurance effected by
it, notify IFC of the brokers and any protection and indemnity or war
risks association through or with whom such Borrower proposes to renew
that insurance and of the proposed terms of renewal;
and
|
|
(ii)
|
procure
that the approved brokers and/or the war risks and protection and
indemnity associations with which such a renewal is effected shall notify
IFC in writing of the terms and conditions of the renewal promptly after
the renewal.
|
(c) Hull and Machinery, War Risk
and Increased Value Coverage; Letters of Undertaking. With
respect to hull and machinery, war risk and increased value coverage, each
Borrower that owns a Mortgaged Vessel shall ensure that the brokers for such
coverage provide IFC with true and correct copies of (i) all cover notes and/or
certificates of entry and, if requested by IFC, pro forma copies of all policies
relating to such insurances which they are to effect or renew and (ii) a letter
or letters of undertaking in a form acceptable to IFC and provided that this is
not inconsistent with market practice such letter or letters of undertaking
shall include undertakings by such brokers that:
|
(A)
|
they
will have endorsed on each policy, immediately upon issue, a loss payable
clause and a notice of assignment in an agreed form and complying with the
provisions of paragraph (c)(ii) of Annex
C;
|
|
(B)
|
they
will hold such policies, and the benefit of such insurances, to the order
of the Security Trustee in accordance with the said loss payable
clause;
|
|
(C)
|
they
will advise IFC and/or the Security Trustee immediately of any material
change to the terms of the obligatory
insurances;
|
80
|
(D)
|
they
will notify IFC and/or the Security Trustee, not less than 14 days before
the expiry of the obligatory insurances, in the event of their not having
received notice of renewal instructions from the relevant Borrower or its
agents and, in the event of their receiving instructions to renew, they
will promptly notify IFC and/or the Security Trustee of the terms of the
instructions; and
|
|
(E)
|
they
will not set off against any sum recoverable in respect of a claim
relating to such Mortgaged Vessel under such obligatory insurances any
premiums or other amounts due to them or any other Person in respect of
any Vessel not subject to a Mortgage or premiums due for other insurances,
they waive any lien on the policies relating to such Mortgaged
Vessel or, any sums received under them, which they might have in respect
of premiums or other amounts due to them or any other Person in respect of
any Vessel not subject to a Mortgage or premiums due for such other
insurances, and they will not cancel such obligatory insurances by reason
of non-payment of premiums or other amounts due to them or any other
Person in respect of any Vessel not subject to a Mortgage or premiums due
for such other insurances, and will arrange for a separate policy to be
issued in respect of that Mortgaged Vessel forthwith upon being so
requested by IFC and/or the Security
Trustee.
|
(d) Protection and Indemnity
Coverage; Letters of Undertaking. Each Borrower that owns a
Mortgaged Vessel shall ensure that any protection and indemnity and/or war risks
associations in which such Mortgaged Vessel is entered provides IFC
with:
(i)
a copy of the certificate of entry for that Mortgaged Vessel; and
(ii) a
letter or letters of undertaking in agreed form;
81
(e) Deposit of Original Policies
for Hull and Machinery, War Risk and Increased Value
Coverage. With respect to hull and machinery, war risk and
increased value coverage, each Borrower that owns a Mortgaged Vessel shall
ensure that all policies relating to obligatory insurances effected by it are
deposited with the approved brokers through which the insurances are effected or
renewed.
(f) Payment of
Premiums. Each Borrower that owns a Mortgaged Vessel shall
punctually pay or cause to be paid all premiums or other sums payable in respect
of the obligatory insurances effected for such Mortgaged Vessel and produce all
relevant receipts when so required by IFC.
(g) Guarantees. Each
Borrower that owns a Mortgaged Vessel shall ensure that any guarantees required
by a protection and indemnity or war risks association are promptly issued and
remain in full force and effect.
(h) Compliance With Terms of
Insurances. Each Borrower that owns a Mortgaged Vessel shall
not do nor omit to do (nor permit to be done or not to be done) any act or thing
which would or might render any obligatory insurance invalid, void, voidable or
unenforceable or render any sum payable thereunder repayable in whole or in
part; and, in particular:
|
(i)
|
such
Borrower shall take all necessary action and comply with all requirements
which may from time to time be applicable to the obligatory insurances,
and ensure that the obligatory insurances are not made subject to any
exclusions or qualifications to which IFC has not given its prior
approval;
|
|
(ii)
|
such
Borrower shall not make any changes relating to the manager or operator of
such Mortgaged Vessel unless approved by the underwriters of the
obligatory insurances; and
|
|
(iii)
|
such
Borrower shall not employ such Mortgaged Vessel, nor allow it to be
employed, otherwise than in conformity with
the terms and conditions of the obligatory insurances, without first
obtaining the consent of the insurers and complying with any requirements
(as to extra premium or otherwise) which the insurers
specify.
|
82
(i) Alteration to Terms of
Insurances. Each Borrower that owns a Mortgaged Vessel shall
not make nor agree to any material alteration to the terms of any obligatory
insurance (unless in the opinion of IFC such alteration is consistent with
general market practice or relates to increased value) nor waive any material
right relating to any obligatory insurance.
(j) Settlement of
Claims. Each Borrower that owns a Mortgaged Vessel shall do
all things necessary and provide all documents, evidence and information to
enable the Security Trustee to collect or recover any moneys which at any time
become payable in respect of the obligatory insurances.
(k) Provision of Copies of
Communications. Each Borrower that owns a Mortgaged Vessel
shall provide IFC at the time of each such communication, with copies of all
written communications between such Borrower and:
(i)
the approved brokers;
(ii)
the approved protection and indemnity and/or war risks associations;
and
(iii) the
approved insurance companies and/or underwriters,
which
relate, in each case directly or indirectly to either any actual or threatened
termination or material adverse change in the terms of any of the obligatory
insurances or any recovery which, under the terms of any loss payable clause as
referred to in paragraph (c) of Annex C, shall or may be payable to
IFC.
(l) Provision of
Information. In addition, each Borrower that owns a Mortgaged
Vessel shall promptly provide IFC (or any persons which it may designate) with
any information which IFC (or any such designated person) requests from time to
time for the purpose of:
|
(i)
|
obtaining
or preparing any report from an independent marine insurance broker as to
the obligatory insurances effected or proposed to be effected;
and/or
|
83
|
(ii)
|
effecting,
maintaining or renewing any such insurances as are referred to in Annex C
or dealing with or considering any matters relating to any such
insurances,
|
and such
Borrower shall, forthwith upon demand, indemnify IFC in respect of all fees and
other expenses incurred by or for the account of IFC in connection with any such
report as is referred to in paragraph (i) above.
(m) Review of Insurance
Requirements. IFC may review the requirements of this Section
5.05 (Insurance
Covenants) from time to time in order to take account of any changes in
circumstances after the date of this Agreement which are, in the opinion of IFC
significant and capable of affecting the Borrowers or the Vessels owned by them
and its or their insurance (including, without limitation, changes in the
availability or the cost of insurance coverage or the risks to which the
Borrowers may be subject.)
(n) Modification of Insurance
Requirements. IFC shall notify the Borrowers of any proposed
modification under 5.05 (m) to the requirements of this Section 5.05 (Insurance Covenants) which
IFC, may reasonably consider appropriate in the circumstances and, after
consultation and taking full account of the Borrowers' opinions, such
modification shall take effect on and from the date it is notified in writing to
the Borrowers as an amendment to this Section 5.05 (Insurance Covenants) and
shall bind the Borrowers accordingly.
(o) Compliance with
Instructions. Upon notice to the Borrowers, the Security
Trustee shall be entitled (without prejudice to or limitation of any other
rights which it may have or acquire under any Transaction Document) to require
any Mortgaged Vessel to remain at any safe port or to proceed to and remain at
any safe port designated by IFC until the Borrowers implement any amendments to
the terms of the obligatory insurances and any operational changes required as a
result of a notice served under Section 5.05 (n) (Modification of Insurance
Covenants).
|
(p)
|
Application of
Proceeds.
|
|
(i)
|
At
its discretion, IFC may remit the proceeds of any insurance paid to it
(via the Security Trustee) to the Borrowers
to repair or replace the relevant damaged assets or may apply those
proceeds towards any amount payable to IFC under this Agreement, including
to repay or prepay all or any part of the Loan in accordance with Section
2.07B (Mandatory
Prepayment), provided that there
shall be no minimum amount or notice period for any such prepayment;
and
|
84
|
(ii)
|
The
Borrower shall use any insurance proceeds it receives (whether from IFC,
the Security Trustee on behalf of IFC or directly from the insurers) for
loss of or damage to any asset solely to replace or repair that asset or
apply towards the Project unless otherwise directed by
IFC.
|
ARTICLE
VI
Events
of Default
Section 6.01. Acceleration
after Default. If any Event of Default occurs and is
continuing (whether it is voluntary or involuntary, or results from operation of
law or otherwise), IFC may, by notice to the Borrowers, require the Borrowers to
repay the Loan or such part of the Loan as is specified in that
notice. On receipt of any such notice, the Borrowers shall
immediately repay the Loan (or that part of the Loan specified in that notice)
and pay all interest accrued on it, the prepayment premium specified in Section
2.07A (Voluntary
Prepayment) on the amount of the Loan whose payment is accelerated and
any other amounts then payable under this Agreement. The Borrowers waive any
right they might have to further notice, presentment, demand or protest with
respect to that demand for immediate payment.
Section 6.02. Events
of Default. It shall be an Event of Default if:
(a) Failure to Pay Principal or
Interest. The Borrowers fail to pay when due any part of the
principal of, or interest on, the Loan and such failure continues for a period
of five (5) days;
(b) Failure to Pay Other IFC
Loans. A Borrower fails to pay when due any part of the
principal of, or interest on, any loan from IFC to such Borrower other than the
Loan and any such failure continues for the relevant grace period allowed for in
the agreement providing for that loan;
85
(c) Failure to Comply with
Obligations. A Borrower fails to comply with any of its
obligations under this Agreement or any other Transaction Document or any other
agreement between such Borrower and IFC (other than for the payment of the
principal of, or interest on, the Loan), and any such failure continues for a
period of thirty (30) days after the date on which IFC notifies such Borrower of
that failure;
(d) Failure by Other Parties to
Comply with Obligations. Any party to a Transaction Document
(other than IFC or the Borrowers) fails to observe or perform any of its
obligations under that Transaction Document, and any such failure continues for
a period of thirty (30) days after the date on which IFC notifies the Borrowers
of that failure, provided
that in the case of a breach of the Section 6.01(k) of the Guarantee
Agreement, the grace period shall be 90 days so long as the Guarantor Historical
Debt Service Coverage Ratio is not less than 1.2;
(e) Misrepresentation. Any
representation or warranty made in Article III or by any other party to a
Transaction Document or in connection with the execution of, or any request
(including a request for Disbursement) under, this Agreement or any other
Transaction Document is found to be incorrect in any material
respect;
(f) Expropriation,
Nationalization, Etc. Any Authority condemns, nationalizes,
seizes, or otherwise expropriates all or any substantial part of the property or
other assets of a Borrower, the Guarantor or any Major Guarantor Subsidiary, or
its respective capital stock, or assumes custody or control of that property or
other assets or of the business or operations of such Borrower, the Guarantor or
such Major Guarantor Subsidiary or of its respective capital stock, or takes any
action for the dissolution or disestablishment of such Borrower or the Guarantor
or such Major Guarantor Subsidiary or any action that would prevent a Borrower,
the Guarantor, such Major Guarantor Subsidiary or their respective officers from
carrying on all or a substantial part of its business or
operations;
(g) Involuntary
Proceedings. A decree or order by a court of competent
jurisdiction is entered against any Borrower, the Guarantor or any Major
Guarantor Subsidiary:
|
(i)
|
adjudging
such Person bankrupt or
insolvent;
|
86
|
(ii)
|
approving
as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of, or with respect to, such Person under any
applicable law;
|
|
(iii)
|
appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Person or of any substantial part of its property or
other assets; or
|
|
(iv)
|
ordering
the winding up or liquidation of its
affairs;
|
or any
petition is filed seeking any of the above and is not dismissed within thirty
(30) days;
(h) Voluntary
Proceedings. Any Borrower, the Guarantor or any Major
Guarantor Subsidiary:
|
(i)
|
requests
a moratorium or suspension of payment of Liabilities from any
court;
|
|
(ii)
|
institutes
proceedings or takes any form of corporate action to be liquidated,
adjudicated bankrupt or insolvent;
|
|
(iii)
|
consents
to the institution of bankruptcy or insolvency proceedings against
it;
|
|
(iv)
|
files
a petition or answer or consent seeking reorganization or relief under any
applicable law, or consents to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of such Person or of any substantial part of its
property;
|
|
(v)
|
makes
a general assignment for the benefit of creditors;
or
|
|
(vi)
|
admits
in writing its inability to pay its Liabilities generally as they become
due or otherwise becomes
insolvent;
|
(i)
Attachment. An
attachment or analogous process is levied or enforced upon or against any of the
assets of a Borrower or more than 5% of the assets of the Guarantor and either
is not discharged within sixty (60) days unless it is being contested in good
faith by the affected party and the attachment is simply recorded with no effect
either on the freedom of the attached assets to navigate or their earning
capacity or on the free disposition of such earnings or replaced by a bond,
guarantee or other substitute collateral provided by the insurers of such
Person;
87
(j)
Analogous Events to
Bankruptcy. Any other event occurs with respect to a Borrower,
the Guarantor or any Major Guarantor Subsidiary which under any applicable law
would have an effect analogous to any of those events listed in Section 6.02
(g), Section 6.02(h) and Section 6.02 (i) (Events of
Default);
(k) Cross-Default.
|
(i)
|
Any
Borrower, the Guarantor or any Major Guarantor Subsidiary fails to make
any payment in respect of any of its Financial Debt (other than the Loan)
or to perform any of its obligations under any agreement pursuant to which
there is outstanding any Financial Debt, and any such failure continues
for more than any applicable period of grace or any such Financial Debt
becomes prematurely due and payable or is placed on
demand;
|
|
(ii)
|
An
Event of Default has occurred and is continuing under any UABLPY Loan
Document or any Parallel Loan
Document;
|
|
(iii)
|
The
Guarantor breaches any of its obligations under the Guarantee
Agreement;
|
|
(iv)
|
Any
Guarantor Subsidiary (other than the Borrowers) breaches any of its
obligations under a Transaction Document to which it is a
party;
|
(l)
Failure to Maintain
Authorizations. Any Authorization necessary for the Borrowers,
the Guarantor or a Major Guarantor Subsidiary to perform and observe their
obligations under any Transaction Document, or to carry out the Project, is not
obtained when required or is rescinded, terminated, lapses or otherwise
ceases to be in full force and effect, including with respect to the remittance
to IFC or its assignees, in Dollars, of any amounts payable under any
Transaction Document, and is not restored or reinstated within thirty (30) days
of notice by IFC to the Borrowers requiring that restoration or reinstatement,
provided that such
failure shall not be an Event of Default under this Section if the relevant
Authorization is not related to (i) due organization or corporate existence,
(ii) any Mortgaged Vessel, or (iii) assets representing more than 5% of the
Guarantor's Vessels at any time;
88
(m) Revocation, Etc., of
Security Documents. Any Security Document or any of its
provisions:
|
(i)
|
is
revoked, terminated or ceases to be in full force and effect or ceases to
provide the security intended, without, in each case, the prior consent of
IFC;
|
|
(ii)
|
becomes
unlawful or is declared void; or
|
|
(iii)
|
is
repudiated or its validity or enforceability is challenged by any Person
and any such repudiation or challenge continues for (A) a period of thirty
(30) days during which period such repudiation or challenge has no effect;
or (B) such shorter period as ends immediately before such repudiation or
challenge becomes effective;
|
(n) Revocation, etc., of
Transaction Documents. Any Transaction Document (other than a
Security Document) or any of its provisions:
|
(i)
|
is
revoked, terminated or ceases to be in full force and effect without, in
each case, the prior consent of IFC, and that event, if capable of being
remedied, is not remedied to the satisfaction of IFC within thirty (30)
days of IFC's notice to the Borrowers;
or
|
|
(ii)
|
becomes
unlawful or is declared void; or
|
|
(iii)
|
is
repudiated or the validity or enforceability of any of its provisions at
any time is challenged by any Person and such repudiation or challenge is
not withdrawn within thirty (30) days of IFC's notice to the
Borrowers requiring that
withdrawal;
provided
that no such notice shall be required or, as the case may be, the notice
period shall terminate if and when such repudiation or challenge becomes
effective; or
|
89
(o) Notes. There
occurs the enforcement of any collateral, security interest or guarantee created
by or given, as the case may be, by a Borrower or any Guarantor Subsidiary
securing the repayments of the Notes and all amount due to holders of the
Notes.
Section 6.03. Bankruptcy. If
any Borrower, the Guarantor or a Major Guarantor Subsidiary is liquidated or
declared bankrupt, the Loan, all interest accrued on it and any other amounts
payable under this Agreement will become immediately due and payable without any
presentment, demand, protest or notice of any kind, all of which the Borrowers
waive.
ARTICLE
VII
Miscellaneous
Section
7.01. Saving
of Rights. (a) The rights and remedies of IFC in
relation to any misrepresentation or breach of warranty on the part of the
Borrowers shall not be prejudiced by any investigation by or on behalf of IFC
into the affairs of the Borrowers, by the execution or the performance of this
Agreement or by any other act or thing which may be done by or on behalf of IFC
in connection with this Agreement and which might, apart from this Section,
prejudice such rights or remedies.
(b) No
course of dealing or waiver by IFC in connection with any condition of
Disbursement of the Loan under this Agreement shall impair any right, power or
remedy of IFC with respect to any other condition of Disbursement, or be
construed to be a waiver thereof; nor shall the action of IFC with respect to
any Disbursement affect or impair any right, power or remedy of IFC with respect
to any other Disbursement.
(c) Unless
otherwise notified to the Borrowers by IFC and without prejudice to the
generality of Section 7.01 (b) (Saving of Rights), the right
of IFC to require compliance with any condition under this Agreement that may be
waived by
IFC with respect to any Disbursement is expressly preserved for the purposes of
any subsequent Xxxxxxxxxxxx.
00
(x) No
course of dealing and no failure or delay by IFC in exercising, in whole or in
part, any power, remedy, discretion, authority or other right under this
Agreement or any other agreement shall waive or impair, or be construed to be a
waiver of, such or any other power, remedy, discretion, authority or right under
this Agreement, or in any manner preclude its additional or future exercise; nor
shall the action of IFC with respect to any default, or any acquiescence by it
therein, affect or impair any right, power or remedy of IFC with respect to any
other default.
Section
7.02. Notices. Any
notice, request or other communication to be given or made under this Agreement
shall be in writing. Subject to Section 5.03 (h) and (i) (Reporting Requirements) and
Section 7.05 (Enforcement), any such
communication may be delivered by hand, airmail, facsimile or established
courier service to the party's address specified below or at such other address
as such party notifies to the other party from time to time, and will be
effective upon receipt.
For any Borrower:
Capital
Plaza Building, 15th Floor
Paseo
Xxxxxxx Xxxxx
Costa xxx
Xxxx
XX Xxx
0000-00000
Xxxxxx,
Xxxxxxxx of Panama
Facsimile:
x000-000-0000
with a
copy to:
Ravenscroft
Ship Management Inc.
0000
Xxxxx xx Xxxx Xxxx.
Xxxxx
Xxxxxx, Xxxxxxx 00000
Facsimile:
x000-000-0000
For IFC:
International Finance
Corporation
0000 Xxxxxxxxxxxx Xxxxxx,
X.X.
Xxxxxxxxxx, X.X. 00000
Xxxxxx Xxxxxx of America
91
Facsimile: x0 (000)
000-0000
Attention: Director,
Infrastructure Department
|
With
a copy (in the case of communications relating to payments) sent to the
attention of the Director, Department of Financial Operations,
at:
|
Facsimile: 000-000-0000.
Section 7.03. English
Language. (a) All documents to be provided or
communications to be given or made under this Agreement shall be in the English
language.
(b) To
the extent that the original version of any document to be provided, or
communication to be given or made, to IFC under this Agreement or any other
Transaction Document is in a language other than English, that document or
communication shall be accompanied by an English translation certified by an
Authorized Representative to be a true and correct translation of the
original. IFC may, if it so requires, obtain an English translation
of any document or communication received in a language other than English at
the cost and expense of the Borrowers. IFC may deem any such English
translation to be the governing version between the Borrowers and
IFC.
Section 7.04. Term of
Agreement. This Agreement shall continue in force until all
monies payable under it have been fully paid in accordance with its
provisions.
Section 7.05. Applicable
Law and Jurisdiction.
(a) This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, United States of America.
(b) For
the exclusive benefit of IFC, each of the Borrowers irrevocably agrees that any
legal action, suit or proceeding arising out of or relating to this Agreement or
any other Transaction Document to which a Borrower is a party may be
brought in the courts of the United States of America located in the Southern
District of New York or in the courts of the State of New
York located in the Borough of Manhattan. By the execution
of this Agreement, each Borrower irrevocably submits to the jurisdiction of any
such court in any such action, suit or proceeding. Final judgment
against a Borrower in any such action, suit or proceeding shall be conclusive
and may be enforced in any other jurisdiction, including the Republic of Panama
and the Republic of Liberia, by suit on the judgment, a certified or exemplified
copy of which shall be conclusive evidence of the judgment, or in any other
manner provided by law.
92
(c) Nothing
in this Agreement shall affect the right of IFC to commence legal proceedings or
otherwise xxx a Borrower in the Republic of Panama or the Republic of Liberia or
any other appropriate jurisdiction, or concurrently in more than one
jurisdiction, or to serve process, pleadings and other legal papers upon a
Borrower in any manner authorized by the laws of any such
jurisdiction.
(d) Each
Borrower hereby irrevocably designates, appoints and empowers CT Corporation
System, with offices currently located at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, as its authorized agent solely to receive for and on its
behalf service of any summons, complaint or other legal process in any action,
suit or proceeding IFC may bring in the State of New York in respect of this
Agreement.
(e) As
long as this Agreement remains in force, each Borrower shall maintain a duly
appointed and authorized agent to receive for and on its behalf service of any
summons, complaint or other legal process in any action, suit or proceeding IFC
may bring in New York, New York, United States of America, with respect to this
Agreement. Each Borrower shall keep IFC advised of the identity and
location of such agent.
(f)
Each Borrower also irrevocably consents, if for any reason its authorized agent
for service of process of summons, complaint and other legal process in any
action, suit or proceeding is not present in New York, New York, to the service
of such papers being made out of the courts of the United States of America
located in the Southern District of New York and the courts of the State of New
York located in the Borough of Manhattan by mailing copies of the papers by
registered United States air mail, postage prepaid, to the Borrower, at its
address specified pursuant to Section 7.02 (Notices). In such
a case, IFC shall also send
by facsimile, or have sent by facsimile, a copy of the papers to such
Borrower.
93
(g) Service
in the manner provided in Sections 7.05 (d), (e) and (f) (Applicable Law and
Jurisdiction) in any action, suit or proceeding will be deemed personal
service, will be accepted by a Borrower as such and will be valid and binding
upon such Borrower for all purposes of any such action, suit or
proceeding.
(h) Each
Borrower irrevocably waives to the fullest extent permitted by applicable
law:
|
(i)
|
any
objection which it may have now or in the future to the laying of the
venue of any action, suit or proceeding in any court referred to in this
Section;
|
|
(ii)
|
any
claim that any such action, suit or proceeding has been brought in an
inconvenient forum;
|
|
(iii)
|
its
right of removal of any matter commenced by IFC in the courts of the State
of New York to any court of the United States of America;
and
|
|
(iv)
|
any
and all rights to demand a trial by jury in any such action, suit or
proceeding brought against such party by
IFC.
|
(i) To
the extent that a Borrower may be entitled in any jurisdiction to claim for
itself or its assets immunity in respect of its obligations under this Agreement
or any other Transaction Document to which it is a party, from any suit,
execution, attachment (whether provisional or final, in aid of execution, before
judgment or otherwise) or other legal process or to the extent that in any
jurisdiction that immunity (whether or not claimed) may be attributed to it or
its assets, such Borrower irrevocably agrees not to claim and irrevocably waives
such immunity to the fullest extent permitted now or in the future by the laws
of such jurisdiction.
(j) Each
Borrower hereby acknowledges that IFC shall be entitled under applicable law,
including the provisions of the International Organizations Immunities Act, to
immunity from a trial by jury in any action, suit or proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby
brought against IFC in any court of the United States of
America. Each Borrower hereby waives any and all rights to demand a
trial by jury in any action, suit or proceeding arising out of or relating to
this Agreement or the transactions contemplated by this Agreement, brought
against IFC in any forum in which IFC is not entitled to immunity from a trial
by jury.
94
(k) To
the extent that a Borrower may, in any action, suit or proceeding brought in any
of the courts referred to in Section 7.05 (b) (Applicable Law and
Jurisdiction) or a court of the
Country or elsewhere arising out of or in connection with this Agreement or any
other Transaction Document to which such Borrower is a party, be entitled to the
benefit of any provision of law requiring IFC in such action, suit or proceeding
to post security for the costs of such Borrower, or to post a bond or to take
similar action, such Borrower hereby irrevocably waives such benefit, in each
case to the fullest extent now or in the future permitted under the laws of the
Country or, as the case may be, the jurisdiction in which such court is
located.
Section 7.06. Disclosure
of Information. (a) IFC may disclose any documents
or records of, or information about, this Agreement or any other Transaction
Document, or the assets, business or affairs of the Borrowers, the Guarantor or
any Guarantor Subsidiary to:
|
(i)
|
its
outside counsel, auditors and rating
agencies,
|
|
(ii)
|
any
Person who intends to purchase a participation in a portion of the Loan,
provided that such Person has entered into a suitable non-disclosure
agreement, and
|
|
(iii)
|
any
other Person as IFC may deem appropriate in connection with any proposed
sale, transfer, assignment or other disposition of IFC's rights under this
Agreement or any Transaction Document or otherwise for the purpose of
exercising any power, remedy, right, authority, or discretion relevant to
this Agreement or any other Transaction
Document.
|
(b) The
Borrowers acknowledge and agree that, notwithstanding the terms of any other
agreement between the Borrowers and IFC, a disclosure of information
by IFC in the circumstances contemplated by Section 7.06 (a) (Disclosure of Information)
does not violate any duty owed to the Borrowers under this Agreement or under
any such other agreement.
95
(c) The
Borrowers, the Guarantor and Ultrapetrol may disclose the contents of the
Transaction Documents as may be required by law or by the rules of the exchange
on which such Person's securities are quoted.
Section
7.07. Successors
and Assignees. This Agreement binds and benefits the
respective successors and assignees of the parties. However, the Borrowers may
not assign or delegate any of their rights or obligations under this Agreement
without the prior consent of IFC.
Section
7.08. Amendments,
Waivers and Consents. Any amendment or waiver of, or any
consent given under, any provision of this Agreement shall be in writing and, in
the case of an amendment, signed by the parties.
Section
7.09. Counterparts. This
Agreement may be executed in several counterparts, each of which is an original,
but all of which together constitute one and the same agreement.
96
IN WITNESS WHEREOF, the parties have
caused this Agreement to be signed in their respective names as of the date
first above written.
UABL BARGES (PANAMA) INC.
By : _______________________
Name: Xxxxxx Xxxxxxxx
Xxxx
Title : Attorney-in-Fact
UABL TOWING SERVICES S.A.
By : _______________________
Name: Xxxxxx Xxxxxxxx
Xxxx
Title : Attorney-in-Fact
MARINE FINANCIAL INVESTMENT
CORP.
By : _______________________
Name: Xxxxxx Xxxxxxxx
Xxxx
Title : Attorney-in-Fact
EASTHAM BARGES INC.
By : _______________________
Name: Xxxxxx Xxxxxxxx
Xxxx
Title : Attorney-in-Fact
INTERNATIONAL FINANCE
CORPORATION
By : _______________________
Name: _______________________
Title : _______________________
97
ANNEX A
Page 1 of
1
PROJECT COST AND FINANCIAL
PLAN
ESTIMATED
PROJECT COST
|
US$000
|
%
|
||
Pushboat
Modification & Re-Engining: Construction of Zonda 1
|
52,463
|
23.3
|
||
Existing
Barge Enlargement and Rebottoming
|
58,000
|
25.8
|
||
Barge/Pushboat
Construction and Purchase
|
114,308
|
50.9
|
||
TOTAL
PROJECT COST
|
224,771
|
100.0
|
||
FINANCIAL
PLAN
|
||||
IFC
Loan
|
60,000
|
26.7
|
||
Parallel
Loan (from OFID)
|
15,000
|
6.7
|
||
Internal
Cash Flow/Shareholders' Loan(s)
|
149,770
|
66.6
|
||
TOTAL
SOURCES OF FINANCING
|
224,771
|
100.0
|
98
ANNEX B
Page 1 of
2
PROJECT
AUTHORIZATIONS
Section
1 - Authorizations Already Obtained
|
(a)
|
authorizations
relating to the business of each of the Borrowers, the Guarantor and each
Guarantor Subsidiary (other than the Borrowers) as it is presently carried
on and as it is contemplated to be carried
on;
|
|
(b)
|
resolutions
of the board of directors of each of the Borrowers authorizing the
execution and performance by each of the Borrowers of this Agreement and
the other Transaction Documents to which each Borrower is a
party;
|
|
(c)
|
resolutions
of the board of directors of each of the Guarantor and each Guarantor
Subsidiary (other than the Borrowers) authorizing the execution and
performance by each of the Guarantor and each Guarantor Subsidiary (other
than the Borrowers) of the Transaction Documents to which each is a party;
and
|
|
(d)
|
resolutions
of the shareholders of the Guarantor approving the resolutions of the
Guarantor's board of directors and the the execution and performance by
the Guarantor of the Transaction Documents to which it is a
party.
|
Section
2 - Authorizations to be Obtained Prior to or Concurrently with a Disbursement
for Purposes of Sections 4.01 (Conditions of Disbursement)
|
(a)
|
the
registration of each of UABLPN, UABLTS and Marine Financial as a "foreign
maritime entity" within the meaning of Section 51(5)(c) of the Liberian
Maritime Law;
|
|
(b)
|
the
recordation of title to each Mortgaged Vessel in the name of its owner by
the Deputy Commissioner's Office;
|
99
|
ANNEX
B
|
Page 2 of
2
|
(c)
|
the
recordation of the Mortgage on each Mortgaged Vessel by the Deputy
Commissioner's Office;
|
|
(d)
|
the
authorization by the Deputy Commissioner's Office of the Bareboat
Registration of each Mortgaged
Vessel;
|
|
(e)
|
Certificate
of Registry of each Mortgaged Vessel under the Paraguayan
flag.
|
100
ANNEX C
Page 1 of
1
INSURANCE
REQUIREMENTS
(a) Maintenance of Obligatory
Insurances. Each Borrower shall keep each Vessel owned by it
insured, at its own expense, against:
|
(i)
|
fire
and usual marine risks (including hull and machinery and excess
risks);
|
|
(ii)
|
war
risks;
|
|
(iii)
|
protection
and indemnity risks; and
|
|
(iv)
|
any
other risks (excluding loss of earnings insurance) against which IFC may
advise, having regard to practices and other circumstances prevailing at
the relevant time, that it would be reasonable for such Borrower to
insure, as specified by IFC by notice to such
Borrower.
|
(b) Terms of Obligatory
Insurances. Each Borrower that owns a Vessel shall effect such
Insurances:
(i)
in Dollars;
|
(ii)
|
in
the case of fire and usual marine risks and war risks, in an amount on an
agreed value basis (including increased value) equal at all times to the
Fair Market Value of such Vessel or, in the case of Mortgaged Vessels, in
an amount on an agreed value basis (including increased value) equal at
all times to the greater of (A) the Fair Market Value of such Mortgaged
Vessel and (B) for so long as any amounts are outstanding under this
Agreement, the UABLPY Loan Agreement and the Parallel Loan Agreement, an
amount which, when added to the amounts of such insurance on the other
Mortgaged Vessels, is 110% of the aggregate outstanding principal amount
due and owing by the Borrowers
under this Agreement, the UABLPY Loan Agreement and the Parallel Loan
Agreement;
|
101
|
(iii)
|
in
the case of oil pollution liability risks, for an aggregate amount equal
to the highest level of cover from time to time available under basic
protection and indemnity club
entry;
|
|
(iv)
|
in
relation to protection and indemnity risks in respect of the full tonnage
of each Vessel;
|
|
(v)
|
on
terms approved by IFC; and
|
|
(vi)
|
through
brokers and with insurance companies and/or underwriters approved by IFC
acting or, in the case of war risks and protection and indemnity risks, in
war risks and protection and indemnity risks associations, at all times
with reputable international brokers, companies, underwriters and mutual
insurance associations.
|
(c) Further Protections for
IFC. In addition to the terms set out in paragraph (b) above,
each Borrower that owns a Mortgaged Vessel shall procure that the obligatory
insurances shall:
|
(i)
|
if
so required by IFC and in so far as obtainable on reasonable commercial
terms (except in relation to risks referred to in paragraphs (b)(iii) and
(iv)) name (or be amended to name) the Security Trustee as additional
named assured for its rights and interests, warranted no operational
interest and with full waiver of rights of subrogation against the
Security Trustee, but without the Security Trustee thereby being liable to
pay (but having the right to pay) premiums, calls or other assessments in
respect of such insurance;
|
|
(ii)
|
in
relation to risks referred to in paragraphs (b)(iii) and (iv), name (or be
amended to name) the Security Trustee and IFC as co-assureds under a
Misdirected Arrows clause;
|
102
|
(iii)
|
name
the Security Trustee as loss payee in accordance with the loss payable
clauses attached as exhibits to the Insurance Assignment in respect of
such Mortgaged Vessel;
|
|
(iv)
|
provide
that all payments by or on behalf of the insurers under the obligatory
insurances to the Security Trustee in respect of such Mortgaged Vessel
shall be made without set-off, counterclaim or deductions or condition
whatsoever except as permitted by Section 5.05 (c) (ii) (E) (Insurance
Covenants);
|
|
(v)
|
provide
that the insurers shall waive, to the fullest extent permitted by law,
their entitlement (if any) (whether by statute, common law, equity, or
otherwise) to be subrogated to the rights and remedies of the Security
Trustee in respect of any rights or interests (secured or not) held by or
available to the Security Trustee under the Security Documents, until the
Loan shall have been fully repaid and discharged, except that the insurers
shall not be restricted by the terms of this paragraph (iv) from making
personal claims against persons (other than any Borrower, IFC or the
Security Trustee) in circumstances where the insurers have fully
discharged their liabilities and obligations under the relevant obligatory
insurances;
|
|
(vi)
|
provide
that such obligatory insurances shall be primary without right of
contribution from other insurances which may be carried by IFC or the
Security Trustee in respect of the Mortgaged Vessels (but in no case shall
IFC have double insurance for the same
risks);
|
|
(vii)
|
provide
that the Security Trustee may make proof of loss if the relevant Borrower
fails to do so; and
|
|
(viii)
|
provide
that if any obligatory insurance is cancelled, or if any substantial
change is made in the coverage which adversely affects the interest of IFC
or the Security Trustee, or if any obligatory insurance is allowed to
lapse for non-payment of premium, such cancellation, change or lapse shall
not be effective with respect to IFC or the Security
Trustee for 15 days (or 7 days in the case of war risks) after receipt by
IFC and the Security Trustee of prior written notice from the insurers of
such cancellation, change or
lapse.
|
103
(d) Reinsurance. In
respect of any reinsurance relating to any Mortgaged Vessel owned by a Borrower
for which there is a legal obligation to place the primary insurance in the
local market where the such Mortgaged Vessel operates or in which such Mortgaged
Vessel is registered or in which a bareboat charter agreement in respect thereof
is registered, such primary insurance shall contain a "cut-through" clause
acceptable to IFC if permitted by applicable laws of such place if obtainable
from reinsurers on normal commercial terms.
(e) Mortgagee's Interest
Insurance. In respect of the Mortgaged Vessels, the Borrowers
shall subscribe and thereafter maintain and renew, at their sole expense, in an
amount not less than 110 percent of the aggregate of the Loan, the UABLPY loan
and the Parallel Loan), on such terms, through such insurers and generally in
such manner as IFC and/or the Security Trustee may from time to time consider
appropriate, a mortgagee's interest marine insurance covering the Mortgaged
Vessels and providing for the indemnification of IFC, OFID and the Security
Trustee for any losses under or in connection with any Security Document which
directly or indirectly result from loss of or damage to any Mortgaged Vessel
covered by such insurance or a liability of any such Mortgaged Vessel or of the
Borrower that owns such Mortgaged Vessel or the operator thereof, being a loss
or damage which is prima facie covered by an obligatory insurance under
paragraph (a) above but in respect of which there is a non-payment (or reduced
payment) by the underwriters by reason of, or on the basis of an allegation
concerning, among other things:
|
(i)
|
any
act or omission on the part of the relevant Borrower, of any operator,
charterer, manager or sub-manager of any such Mortgaged Vessel or of any
officer, employee or agent of the relevant Borrower or of any such person,
including any breach of warranty or condition or any non-disclosure
relating to such obligatory insurance;
and/or
|
|
(ii)
|
any
act or omission, whether deliberate, negligent or accidental, or any
knowledge or privity of the relevant Borrower, any other person referred
to in paragraph (A) above, or of any officer, employee or agent of the
relevant Borrower
or of such a person, including the casting away or damaging of any such
Mortgaged Vessel and/or any such Mortgaged Vessel being
unseaworthy.
|
104
The
Borrowers shall upon demand fully indemnify IFC and/or the Security Trustee in
respect of all premiums and other reasonable expenses which are incurred in
connection with or with a view to effecting, maintaining or renewing any such
insurance or dealing with, or considering, any matter arising out of any such
insurance.
105
ANNEX D
Page 1 of
4
ANTI-CORRUPTION
GUIDELINES
FOR IFC
TRANSACTIONS
The
purpose of these Guidelines is to clarify the meaning of the terms "Corrupt
Practices", "Fraudulent Practices", "Coercive Practices", "Collusive Practices"
and "Obstructive Practices" in the context of IFC operations.
1.
Corrupt Practices
A
"Corrupt Practice" is the offering, giving, receiving or soliciting, directly or
indirectly, of anything of value to influence improperly the actions of another
party.
Interpretation
|
A.
|
Corrupt
practices are understood as kickbacks and bribery. The conduct
in question must involve the use of improper means (such as bribery) to
violate or derogate a duty owed by the recipient in order for the payor to
obtain an undue advantage or to avoid an obligation. Antitrust,
securities and other violations of law that are not of this nature are
excluded from the definition of corrupt
practices.
|
|
B.
|
It
is acknowledged that foreign investment agreements, concessions and other
types of contracts commonly require investors to make contributions for
bona fide social development purposes or to provide funding for
infrastructure unrelated to the project. Similarly, investors are often
required or expected to make contributions to bona fide local charities.
These practices are not viewed as Corrupt Practices for purposes of these
definitions, so long as they are permitted under local law and fully
disclosed in the payor's books and records. Similarly, an investor will
not be held liable for corrupt or fraudulent practices committed by
entities that administer bona fide social development funds or charitable
contributions.
|
106
|
ANNEX
D
|
|
Page
2 of 4
|
|
C.
|
In
the context of conduct between private parties, the offering, giving,
receiving or soliciting of corporate hospitality and gifts that are
customary by internationally-accepted industry standards shall not
constitute corrupt practices unless the action violates applicable
law.
|
|
D.
|
Payment
by private sector persons of the reasonable travel and entertainment
expenses of public officials that are consistent with existing practice
under relevant law and international conventions will not be viewed as
Corrupt Practices.
|
|
E.
|
The
World Bank Group does not condone facilitation payments. For
the purposes of implementation, the interpretation of "Corrupt Practices"
relating to facilitation payments will take into account relevant law and
international conventions pertaining to
corruption.
|
2.
Fraudulent Practices
A
"Fraudulent Practice" is any action or omission, including misrepresentation,
that knowingly or recklessly misleads, or attempts to mislead, a party to obtain
a financial benefit or to avoid an obligation.
Interpretation
|
A.
|
An
action, omission, or misrepresentation will be regarded as made recklessly
if it is made with reckless indifference as to whether it is true or
false. Mere inaccuracy in such information, committed through
simple negligence, is not enough to constitute a "Fraudulent Practice" for
purposes of this Agreement.
|
|
B.
|
Fraudulent
Practices are intended to cover actions or omissions that are directed to
or against a World Bank Group entity. It also covers Fraudulent
Practices directed to or against a World Bank Group member country in
connection with the award or implementation of a government contract or
concession in a project financed by the World Bank
Group. Frauds on other third parties are not condoned but are
not specifically sanctioned in IFC, MIGA, or
PRG operations. Similarly, other illegal behavior is not
condoned, but will not be considered as a Fraudulent Practice for purposes
of this Agreement.
|
107
|
ANNEX
D
|
|
Page
3 of 4
|
3.
Coercive Practices
A
"Coercive Practice" is impairing or harming, or threatening to impair or harm,
directly or indirectly, any party or the property of the party to influence
improperly the actions of a party.
Interpretation
|
A.
|
Coercive
Practices are actions undertaken for the purpose of bid rigging or in
connection with public procurement or government contracting or in
furtherance of a Corrupt Practice or a Fraudulent
Practice.
|
|
B.
|
Coercive
Practices are threatened or actual illegal actions such as personal injury
or abduction, damage to property, or injury to legally recognizable
interests, in order to obtain an undue advantage or to avoid an
obligation. It is not intended to cover hard bargaining, the exercise of
legal or contractual remedies or
litigation.
|
4.
Collusive Practices
A
"Collusive Practice" is an arrangement between two or more parties designed to
achieve an improper purpose, including to influence improperly the actions of
another party.
Interpretation
Collusive
Practices are actions undertaken for the purpose of bid rigging or in connection
with public procurement or government contracting or in furtherance of a Corrupt
Practice or a Fraudulent Practice.
108
ANNEX D
|
Page
4 of 4
|
5.
Obstructive Practices
An
"Obstructive Practice" is (i) deliberately destroying, falsifying, altering or
concealing of evidence material to the investigation or making of false
statements to investigators, in order to materially impede a World Bank Group
investigation into allegations of a corrupt, fraudulent, coercive or collusive
practice, and/or threatening, harassing or intimidating any party to prevent it
from disclosing its knowledge of matters relevant to the investigation or from
pursuing the investigation, or (ii) acts intended to materially impede the
exercise of IFC's access to contractually required information in connection
with a World Bank Group investigation into allegations of a corrupt, fraudulent,
coercive or collusive practice .
Interpretation
Any
action legally or otherwise properly taken by a party to maintain or preserve
its regulatory, legal or constitutional rights such as the attorney-client
privilege, regardless of whether such action had the effect of impeding an
investigation, does not constitute an Obstructive Practice.
General
Interpretation
A person
should not be liable for actions taken by unrelated third parties unless the
first party participated in the prohibited act in question.
000
XXXXX X
Page 1 of
2
ENVIRONMENTAL AND SOCIAL ACTION
PLAN
# | Action | Indicator | Deadline |
1
|
UABL's EHS Management
Systems: Update UABL's Environmental, Health and
Safety Management System to explicitly include reference to IFC's Social
and Environmental Performance Standards.
|
Copy
of UABL's EHS Management System's Policy including explicit
reference to IFC's PSs acceptable to IFC.
|
December,
2008
|
2
|
PM Emission
Reduction: Demonstrate that
Particulate Matter (PM) emissions from UABL's new and re-engineered
engines are the lowest economically achievable and represent good
practice.
|
Copy
of document evidencing good practice for PM emission reduction by UABL
acceptable to IFC.
|
June,
2009
|
3
|
Employees Grievance Redress
Procedure: Develop and implement a grievance procedure
for all workers in accordance to international best practice and include
it in UABL's the Human Resource (HR) Policy. The grievance
procedure should be made available to all employees and be endorsed by
senior management. The procedure should cover: i) inclusion of a statement
in the HR policy describing the grievance procedure standards,
organizational set up and management responsibilities;
ii) define accessible channels to receive grievances; iii)
define grievance procedure; iv) define organizational set up and
responsibilities; v) communication strategy to ensure that the procedure
is disseminated to all employees; v) required documentation, forms, tools
and records; and vi) monitoring, measurement and corrective and preventive
actions.
|
Updated
HR Policy and employee grievance procedure acceptable to
IFC.
|
March,
2009
|
110
# | Action | Indicator | Deadline |
4
|
Community Engagement and
Grievance Redress Mechanism: Develop and
implement as part of the company's EHS Management system a community
engagement and grievance redress mechanism for communities surrounding
UABL operations. The mechanisms should cover the following elements: i)
stakeholder identification; ii) define organizational responsibilities;
iii) define effective mechanisms and strategies to inform surrounding
communities about UABL's operations on on-going basis; and iv) define an
accessible mechanism to receive, register and respond to community
grievances.
|
Community
engagement and grievance redress mechanism acceptable to
IFC.
|
March,
2009
|
5
|
UABL's Terminals and Shipyards
Traffic Plan: Define plans and
implementation schedules with a set of activities, measures and processes
to be implemented to mitigate impacts and risks related to increased
vehicular traffic through UABL's terminals and shipyards. Such plan should
be consistent with anticipated impacts on surrounding communities and
could
|
Updated
traffic plans acceptable to IFC.
|
June,
2009
|
111
# | Action | Indicator | Deadline |
|
include
measures to minimize risk of traffic accidents inside and outside the
facilities such as: speed limitations, limiting hours of facility
operation (as appropriate), installation of cross-walks, signage,
communication with communities and installation of traffic calming devices
to help prevent accidents.
|
|
112
SCHEDULE
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Page 1 of
2
FORM OF CERTIFICATE OF
INCUMBENCY AND AUTHORITY
(See
Section 1.01 and Section 4.01(k) of the Loan Agreement)
[Borrower's
/ Guarantor/ Bareboat Charterer Letterhead]
[Date]
International
Finance Corporation
0000
Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Xxxxxx
Xxxxxx of America
Attention: Director,
____________ Department
Ladies
and Gentlemen:
Certificate of Incumbency
and Authority
With reference to the Loan Agreement
between you, UABL Barges (Panama) Inc., UABL Towing Services S.A., Marine
Financial Investment Corp. and Eastham Barges Inc. dated ________, ___ (the
"Loan Agreement"), I,
the undersigned [name of office] of [Name of Party], ("[l]"), duly authorized to do so,
hereby certify that the following are the names, offices and true specimen
signatures of the persons, each of whom are, and will continue to be,
authorized:
(a) [for
the Borrowers only] to sign on behalf of [l] the requests for the
disbursement of funds provided for in Section 2.02 of the Loan
Agreement;
(b) to
sign the certifications provided for in Sections 4.01 and 4.02 of the Loan
Agreement; and
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SCHEDULE
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Page 2 of
2
(c) to
take any other action required or permitted to be taken, done, signed or
executed under the Loan Agreement or any other agreement to which IFC and [l] may be
parties.
Name*
|
Office
|
Specimen Signature
|
||
______________________________________
|
______________________________________
|
______________________________________
|
||
______________________________________
|
______________________________________
|
______________________________________
|
||
______________________________________
|
______________________________________
|
______________________________________
|
You may assume that any such person
continues to be so authorized until you receive written notice from an
Authorized Representative of [l] that they, or any of
them, is no longer so authorized.
Yours
truly,
|
||
[NAME
OF COMPANY]
|
||
By
|
||
[Title]
|
*
|
Designations
may be changed by the Borrower at any time by issuing a new Certificate of
Incumbency and Authority authorized by the Board of Directors of the
Borrower where
applicable.
|
114
SCHEDULE
2
Page 1 of
3
FORM OF REQUEST FOR
DISBURSEMENT
(See
Section 2.02 and Section 4.03 of the Loan Agreement)
[Borrowers'
Letterhead]
[Date]
International
Finance Corporation
0000
Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Xxxxxx
Xxxxxx of America
Attention: [Director,
____________ Department]
Ladies
and Gentlemen:
Investment
No. ____
Request for Loan Disbursement No.
[ ]*
1. Please
refer to the Loan Agreement (the "Loan Agreement") dated
___________, ___, between UABL Barges (Panama) Inc., UABL Towing Services S.A.,
Marine Financial Investment Corp. and Eastham Barges Inc. (the "Borrowers") and International
Finance Corporation ("IFC"). Terms defined in the
Loan Agreement have their defined meanings whenever used in this
request.
2. The
Borrowers irrevocably request the disbursement on ____________, ____ (or as soon
as practicable thereafter) of the amount of ____________ (____________) under
the Loan (the "Disbursement") in accordance
with the provisions of Section 2.02 of the Loan Agreement. You are
requested to pay such amount as follows: [insert payment
instructions]
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SCHEDULE
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Page 2 of
3
3. For
the purpose of Sections 4.01 and 4.02 of the Loan Agreement, the Borrowers
certify as follows:
(a) no
Event of Default and no Potential Event of Default has occurred and is
continuing;
(b) the
proceeds of the Disbursement are at the date of this request needed by the
Borrowers for the purpose of the Project, or will be needed for such purpose
within three (3) months of such date, or are for the repayment of Shareholder
Loans outstanding as of the date of the Disbursement and attached hereto are
copies of the most recently published financial statements evidencing such
Shareholder Loan(s) and the amount outstanding is confirmed by the Guarantor's
chief financial officer as at the date of the Disbursement;
(c) since
the date of the Loan Agreement nothing has occurred which has or could
reasonably be expected to have a Material Adverse Effect;
(d) since
the date of the Loan Agreement none of the Borrowers, the Guarantor or any other
Guarantor Subsidiary has incurred any material loss or liability (except such
liabilities as may be incurred in accordance with Section 5.02 of the Loan
Agreement);
(e) the
representations and warranties made in Article III of the Loan Agreement and
Article V of the Guarantee Agreement are true on the date of this request and
will be true on the date of Disbursement with the same effect as if such
representations and warranties had been made on and as of each such
date;
(f) the
proceeds of the Disbursement are not in reimbursement of, or to be used for,
expenditures in the territories of any country that is not a member of the World
Bank or for goods produced in or services supplied from any such
country;
(g) after
giving effect to the Disbursement, none of the Borrowers or the Guarantor will
not be in violation of:
|
(i)
|
its
Constitutive Documents;
|
116
SCHEDULE
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|
Page
3 of 3
|
|
(ii)
|
any
provision contained in any document to which such Person is a party
(including the Loan Agreement) or by which such Person is bound;
or
|
|
(iii)
|
any
law, rule, regulation, Authorization or agreement or other document
binding on such Person directly or indirectly, limiting or otherwise
restricting such Person's borrowing power or authority or its ability to
borrow.
|
The above certifications are effective
as of the date of this Request for Disbursement and shall continue to be
effective as of the date of the Disbursement. If any of these
certifications is no longer valid as of or prior to the date of the requested
Disbursement, the Borrowers undertake to immediately notify IFC.
Yours
truly,
|
||
[NAME
OF BORROWERS]
|
||
By
|
||
Authorized
Representative
|
Copy
to: Director, Department of Financial Operations
International
Finance Corporation
117
SCHEDULE
3
Page 1 of
1
FORM OF DISBURSEMENT
RECEIPT
(See
Section 2.02 of the Loan Agreement)
[Borrowers'
Letterhead]
International
Finance Corporation
0000
Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Xxxxxx
Xxxxxx of America
Attention: Director,
Department of Financial Operations
Ladies
and Gentlemen:
Investment
No. ____
Disbursement
Receipt No. [ ]*
We, [Name of Borrowers], hereby
acknowledge receipt on the date hereof, of the sum of
___________ (___) disbursed to [l] by International
Finance Corporation ("IFC") under the Loan of
__________ (___) provided for in the Loan Agreement dated ______, ____ between
us and International Finance Corporation.
Yours
truly,
|
||
[NAME
OF BORROWERS]
|
||
By
|
||
Authorized
Representative**
|
118
SCHEDULE
4
Page 1 of
2
FORM OF ACCEPTANCE OF
SERVICE OF PROCESS LETTER
[Letterhead
of Agent for Service of Process]
(See
Section 4.01 (l) of the Loan Agreement)
[Date]
International
Finance Corporation
0000
Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Attention: _______________
Re: [Country/_________]
Dear
Sirs:
Reference is made to Section ____ of
the Loan Agreement dated _______ (the "Loan Agreement") between _________
(the "Borrowers") and
International Finance Corporation ("IFC"). Unless
otherwise defined herein, capitalized terms used herein shall have the
meaning specified in the Loan Agreement.
Pursuant to Section ___ of the Loan
Agreement the Borrowers have
irrevocably designated and appointed the undersigned, CT Corporation System,
with offices currently located at 000 Xxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, as their authorized agent to receive for and on
their behalf service of process in any legal action or proceeding with respect
to the Loan Agreement in the courts of the United States of America for the
Southern District of New York or in the courts of the State of New York located
in the Borough of Manhattan.
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SCHEDULE
4
Page 2 of
2
The undersigned hereby informs you that
it has irrevocably accepted that appointment as process agent as set forth in
Section [_] of the Loan Agreement, from _______ until ___________ and agrees
with you that the undersigned (i) shall inform IFC promptly in writing of any
change of its address in New York, (ii) shall perform its obligations as such
process agent in accordance with the relevant provisions of Section ______ of
the Loan Agreement and (iii) shall forward promptly to the Borrowers any legal
process received by the undersigned in its capacity as process
agent.
As process agent, the undersigned and
its successor or successors agree to discharge the above-mentioned obligations
and will not refuse fulfillment of such obligations as provided under Section
[_] of the Loan Agreement.
Very
truly yours,
|
||
CT
Corporation System
|
||
By
|
||
Title:
|
cc:
[Borrowers]
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SCHEDULE
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Page 1 of
2
FORM OF LETTER TO
GUARANTOR'S AUDITORS
(See
5.01(e) of
the Loan
Agreement)
[Borrowers'
Letterhead]
[Date]
[NAME OF
AUDITORS]
[ADDRESS]
Ladies
and Gentlemen:
We hereby authorize and request you to
give to International Finance Corporation of 0000 Xxxxxxxxxxxx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000, Xxxxxx Xxxxxx of America ("IFC"), all such information as
IFC may reasonably request with regard to the financial statements (both audited
and unaudited), accounts and operations of the undersigned company, UABL Limited
and the following subsidiaries of the undersigned company: UABL Barges (Panama)
Inc., UABL Towing Services S.A., Marine Financial Investment Corp. and Eastham
Barges Inc. We have agreed to supply that information and those statements under
the terms of a Loan Agreement between the undersigned companies and IFC dated
___________, ____ (the "Loan
Agreement"). For your information we enclose a copy of the
Loan Agreement.
We authorize and request you to send
two copies of the audited accounts of the undersigned companies to IFC to enable
us to satisfy our obligation to IFC under Section 5.03 (b) (i) of the Loan
Agreement. When submitting the same to IFC, please also send, at the same time,
a copy of your full report on such accounts in a form reasonably acceptable to
IFC.
Please note that under Section 5.03 (c)
of the Loan Agreement, we are obliged to provide IFC with a copy of any
management letter or other communication sent by you to the undersigned company
or its management in relation to such company's financial, accounting and other
systems, management or accounts.
121
SCHEDULE
5
Page 2 of
2
Please also submit each such
communication and report to IFC with the audited accounts.
For our records, please ensure that you
send to us a copy of every letter that you receive from IFC immediately upon
receipt and a copy of each reply made by you immediately upon the issue of that
reply.
Yours
truly,
|
||
[NAME
OF BORROWERS]
|
||
By
|
||
Authorized
Representative
|
Enclosure
cc: Director
[Name of Department]
International Finance
Corporation
0000 Xxxxxxxxxxxx Xxxxxx,
X.X.
Xxxxxxxxxx, X.X. 00000
Xxxxxx Xxxxxx of
America
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SCHEDULE
6
Page 1 of
2
FORM OF BORROWER'S
CERTIFICATION
ON DISTRIBUTION OF
DIVIDENDS
(See
Section 5.02 (a) of the Loan Agreement)
[Borrower's
Letterhead]
International Finance Corporation | [Date] |
0000
Xxxxxxxxxxxx Xxxxxx, X.X.
|
|
Xxxxxxxxxx, X.X. 00000 | |
Attention: _______________ | Re: |
[Country/_________] |
Dear
Sirs:
1.
Please refer to the Loan Agreement (the "Loan Agreement") dated
____________, ____ between [Name of Borrowers] (the "Borrowers") and International
Finance Corporation ("IFC"). Terms defined in the
Loan Agreement have their defined meanings whenever used in this
request.
2.
This is to inform you that [l] plans a distribution
of dividends to its shareholders in the aggregate amount of ______________
(______), such distribution to commence on or about _________,
___. Pursuant to Section 5.02 (a) of the Loan Agreement, [l] hereby certifies that,
as at the date hereof:
|
(a)
|
the
proposed payment or distribution is out of retained earnings or out of any
other reserves legally created for such purpose; provided always that the
sum of the retained earnings and such reserves is not less than zero after
giving effect to such payment; and
|
(c)
|
both
before and after giving effect to the proposed distribution no Event of
Default or Potential Event of Default has occurred and is
continuing;
|
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SCHEDULE
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Page 2 of
2
3.
[l] undertakes not to give
effect to the proposed distribution or any part thereof if, at the time of so
doing or after giving effect to it, [l] could not certify the
matters in section 2 of this certification.
Yours
truly,
|
||
[NAME
OF BORROWER]
|
||
By
|
||
Authorized
Representative
|
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SCHEDULE
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Page 1 of
1
ACCEPTABLE
BROKERS
(See
Section 1.01 of the Loan Agreement)
1.
|
Xxxxxx
Brothers S.R.L.
|
||
Xxxxxxxx
000 Xxxx 00
|
|||
Xxxxxx
Xxxxx, Xxxxxxxxx
|
|||
Attn:
Xxxxxxx Xxxxxxx
|
|||
Phone:
|
00-00-00-000-0000
/ 3
|
||
Fax:
|
00-00-00-000-0000
|
||
2.
|
Atlantic
Shipping Brokers Inc. D.B.A. Southport Atlantic
|
||
11380
Xxxxxxxxxx Xxxxx Xxxx, Xxxxx 000
|
|||
Xxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
|
|||
Attn:
Xxxxxx Xxxxxxxx
|
|||
Phone:
|
000-000-0000
|
||
Fax:
|
000-000-0000
|
||
3.
|
Xxxxxxx
Marine Remarketing & Capital Group
|
||
00000
Xxxxx Xxxxxx
|
|||
Xx.
Xxxxx, Xxxxxxxx 00000
|
|||
Attn:
Xxxx Xxxxxxx
|
|||
Phone:
|
000-000-0000
|
||
Fax:
|
000-000-0000
|
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SCHEDULE
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Page 1 of
1
ENVIRONMENTAL AND SOCIAL
PERFORMANCE
ANNUAL
MONITORING REPORT (AMR)
Paraguay
Ultrapretrol
UABL
II
Project
26858
Reporting Period:
(month/year) through (month/year)
amr completion date:
(day/month/year)
Introduction |
The
Annual Monitoring Report
This
Annual Monitoring Report ("AMR") is being delivered by
the undersigned, Ultrapetrol Ltda. / UABL (the "Company") in connection with
the Loan Agreement dated [______], 2008 (as amended, supplemented or modified
and in effect from time to time, the "Loan Agreement") between the
Company and International Finance Corporation ("IFC"). This
document comprises IFC's preferred format for environmental and social
performance reporting.
IFC's
Investment Agreement requires designated Ultrapetrol / UABL personnel to
complete and submit annual environmental and social monitoring reports no later
than ______ (___) days after the end of the Company's fiscal
year.
126
IFC Contact Information |
If you have any questions regarding
the AMR or wish to discuss completion of the AMR please contact the following
Investment Officer or Environmental and Social (E&S)
Specialist.
Investment
Officer
|
Name:
Xxx Xxx
Phone:
0-000-0000000
Email:
xxxx@xxx.xxx
|
E&S
Specialist
|
Name:
Xxxxx Xxxxxxxx
Phone:
0-000-000-0000
Email:
xxxxxxxxx@xxx.xxx
|
1 ENVIRONMENTAL AND SOCIAL MANAGEMENT |
1.1
|
AMR
Preparer
|
Name
and Title:
Phone:
Email:
|
I certify
that the data contained in this AMR completely and accurately represents Company
operations during this reporting period.
Ultrapetrol Ltda. / UABL Employee Name |
Signature
|
Name
of Third Party Organization and
|
Signature
|
Representative
Certifying This Document
|
1.2
|
Environmental
Responsibility Chart
|
Please
name the individuals in the company who hold responsibility for environmental
and social performance (e.g. Environment Manager, Occupational Health and Safety
Manager, Community Relations Manager) and give their contact information (Name,
Address, Telephone Number, Fax Number, E-mail Address).
127
|
|
1.3
|
Compliance
with IFC's requirements 1
|
Is the Company currently in compliance with IFC's requirements pursuant to the Loan Agreement? If no, explain.
For
reference, the applicable Performance Standards2 are:
|
·
|
PS
1: Social and Environmental Assessment and Management
Systems
|
|
·
|
PS
2: Labor and Working Conditions
|
|
·
|
PS
3: Pollution Prevention and
Abatement
|
|
·
|
PS
4: Community Health, Safety and
Security
|
The
applicable IFC Environmental, Health and Safety guidelines are:
|
·
|
IFC
General Environmental, Health and Safety Guidelines dated April 2007;
and
|
|
·
|
IFC
Environmental, Health, and Safety Guidelines for Shipping, dated April
2007
|
|
·
|
IFC
Environmental, Health, and Safety Guidelines for Ports, Harbors, and
Terminals, dated April 2007
|
|
·
|
IFC
Environmental, Health, and Safety Guidelines for Crude Oil and Petroleum
Product Terminals, dated April 2007
|
1.4
|
Summary
of Current Operations
|
Describe
the status of the Project's implementation during the reporting period,
including key milestones.
Describe
any significant changes since the last report in the Company or in the day-to
day operations of the Project that may affect Environmental, Social, Health and
Safety (ESHS) performance.
1 See all IFC Performance Standards and
EHS Guidelines at
xxxx://xxx.xxx.xxx/xxxxxx/xxxxxx.xxx/Xxxxxxx/XxxXxxXxxxxxxxx.
128
Describe
any management initiatives (e.g. ISO 14001, ISO 9001, OHSAS 18001, or any other
Quality/ESHS certifications).
Describe
the Company's approach and progress on implementing ESHS management across all
Project activities.
Except
for specific ongoing improvements and corrective measures as defined in the
environmental permits, is the Company currently in compliance with applicable
national and local ESHS laws and regulations? If no,
explain.
Have any
Governmental Authorities inspected or reviewed the Company's environmental
compliance? If so, please describe.
Discuss
Governmental Approvals received and any difficulties or issues related to
Governmental Approvals.
2 LABOR AND OCCUPATIONAL HEALTH AND SAFETY PERFORMANCE (OHS) |
2.1
|
Labor
|
Describe any changes to the Company's labor/human resources policy and procedures during the reporting period.
Describe
the Project's labor force at the end of the reporting period, including a quantitative summary
of staff directly employed and number of contract workers regularly present at
the Company's facilities but employed through an agent or subcontractor, and key
reasons for changes during the period. Please summarize employees by
gender.
129
Describe
any unions or other workers' organizations that represent staff at the Company's
facilities (both employees and contract staff), and any new collective
bargaining agreements, strikes or other labor disputes/actions, or grievances
reported, and actions taken by the Company.
Please
provide a summary of the number and type of grievances received through the
Company's employee grievance redress mechanism and the responses
provided
2.2
|
Occupational Health and
Safety
|
Please list any reports submitted to any National government authorities, e.g. labor, spill, OHS, fire and safety inspections, compliance monitoring, emergency exercises, as well as comments received and corrective actions taken. National government authorities monitoring and inspections with subsequent actions taken shall also be summarized and reported.
Describe
the status of worker health and safety programs and training. Provide
a quantitative
summary of work-related accidents affecting the Company or its contractors,
including a discussion of trends, response measures taken, and other actions
taken to reduce accidents. Provide a summary of on-going
implementation measures relating to any accidents reported in a previous
reporting year.
Provide a
summary of any significant accidents, fires, or explosions, spills or other
major accidental releases to the environment. Include response
measures taken and any improvements made to equipment or procedures as a
result. Provide a summary of on-going implementation measures
relating to any significant accidents reported in a previous reporting
year.
130
Describe
any other events3 that may have caused damage, brought about
injuries or fatalities or other health problems, attracted the attention of
outside parties, affected project labor or adjacent populations, affected
cultural property, etc. Attach photographs, newspaper articles, or
other supporting information that would be useful for IFC to understand the
incident and associated environmental and social issues.
1. Statistics
(Total Amounts)
This
reporting period
|
Reporting
period
1
year ago
|
Reporting
period
2
years ago
|
||||
Report
Total numbers for each parameter |
Company
employees
|
Contractor
employees
|
Company
employees
|
Contractor
employees
|
Company
employees
|
Contractor
employees
|
Employees
|
||||||
Man-hours
worked
|
||||||
Fatalities
|
||||||
Non-fatal
injuries4
|
||||||
Lost
workdays5
|
||||||
Vehicle
collisions6
|
||||||
Spills
|
||||||
Incidence7
|
3
Examples of significant incidents follow. Chemical and/or hydrocarbon
materials spills; fire, explosion or unplanned releases; industrial injuries;
fatalities including transportation; ecological damage/destruction; local
population disruption; disruption of emissions or effluent treatment;
legal/administrative notice of violation; penalties, fines, or increase in
pollution charges; negative media attention; chance cultural finds; labor unrest
or disputes.
4
Incapacity to work for at least one full workday beyond the day on which the
accident or illness occurred.
5 Lost
workdays are the number of workdays (consecutive or not) beyond the date of
injury or onset of illness that the employee was away from work or limited to
restricted work activity because of an occupational injury or
illness.
131
Please
provide information regarding progress of the activities, measures and processes
implemented by UABL to mitigate impacts and reduced risks related to increased
vehicular traffic flows generated by UABL's terminals and
shipyards.
3 | POLLUTION AND ABATEMENT |
Provide
summaries of
any inspections or testing by the regulatory agencies or by the Company during
the reporting period. Documents prepared for reporting to Government
agencies can supplement or substitute as appropriate. The Company
should provide summaries of inspections and testing, as available, for the
following:
|
Ø
|
Air
emissions (NOx, SOx, PM, etc)8
|
|
Ø
|
Ambient
air quality
|
|
Ø
|
Sanitary
effluent discharges
|
|
Ø
|
Ambient
noise (exterior to the facilities)
|
|
Ø
|
Workplace
noise
|
|
Ø
|
Workplace
air quality
|
|
Ø
|
Non-hazardous
solid and liquid waste management
|
|
Ø
|
Hazardous
materials management
|
|
Ø
|
Hazardous
waste management
|
|
Ø
|
Wastewater
management at maintenance areas and
vessels
|
8 For
guidance on emissions standards for vessels see IFC's EHS Guidelines for
Shipping and IMO standards.
132
Please
discuss any actions taken to maintain PM emissions levels from vessels at the
lowest level economically achievable.
Please
provide information regarding utilization of low sulfur fuel oil for vessels to
ensure compliance with IMO Standards (i.e. percentage of total fuel used,
samples of Fuel Recording Books –MARPOL-, etc).
Greenhouse
Gas ("GHG") emissions –
Report on the Project's estimated GHG emissions (as tons equivalent of CO2) for the
reporting period and the trend over time as efficiency or fuel quality
improvements are implemented for the Company's fleet.
Monitoring
parameter that exceeds IFC/IMO standards and local regulations |
Cause
for
monitoring parameter exceedance |
Corrective
action plan |
Completion
date |
Cost
|
%
Complete/ Status |
|
|||||
|
4 | COMMUNITY ENGAGEMENT |
Discuss
how the Company consults and informs communities in its area of influence, and
the mechanisms in place for the public to contact the Company with complaints or
concerns (i.e., grievance procedures). Describe any significant
grievances received during the reporting period and how they were processed and
resolved.
133
Describe
any Company support for host community development projects and local government
initiatives, including local employment (if any)
134