EXHIBIT 5.1
12 July 2001
Frontline Ltd
Mercury House
101 Front Street
Hamilton HM 12
Bermuda
Dear Sirs
Frontline Ltd. the "Company")
We have acted as legal counsel in Bermuda to the Company as to
matters of Bermuda law to Frontline Ltd., a company organized
under the laws of the Islands of Bermuda (the "Company"), and in
such capacity we have assisted in the preparation and filing with
the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Securities Act"), of a Registration
Statement on Form F-3 (such registration statement and any
additional registration statement filed is referred to as the
"Registration Statement") in relation to the shelf registration
of senior debt securities and subordinated debt securities
(collectively referred to as the "Debt Securities") which may be
issued pursuant to separate indenture, as amended and
supplemented from time to time, between the Company and the
trustee named in the applicable indenture (the "Indenture"),
shares of preferred stock of the Company (the "Preferred Shares")
and shares of common stock of the Company, par value $2.50 per
share (the "Ordinary Shares") (together to be offered from time
to time by the Company up to an aggregate amount of
US$500,000,000.
The Debt Securities, Preferred Shares and Ordinary Shares are
hereinafter referred to as the "Securities."
For the purposes of this opinion we have examined and relied upon
the documents listed (which, in some cases, are also defined) in
the Schedule to this opinion (the "Documents").
Assumptions
In stating our opinion we have assumed:
(a) the authenticity, accuracy and completeness of all Documents
(including, without limitation, public records) submitted to
us as originals and the conformity to authentic original
Documents of all Documents submitted to us as certified,
conformed, notarised or photostatic copies;
(b) the genuineness of all signatures on the Documents;
(c) the authority, capacity and power of each of the persons
signing the Documents (other than the Company);
(d) that any factual statements made in any of the Documents are
true, accurate and complete;
(e) that the Indenture will constitute the legal, valid and
binding obligations of each of the parties thereto, other
than the Company, under the laws of its jurisdiction of
incorporation or its jurisdiction of formation;
(f) that the Indenture will be validly authorised by each of the
parties (other than the Company), and will be validly
executed and delivered by each of the parties thereto and the
performance thereof is within the capacity and powers of each
such party thereto (other than the Company), and that each
such party to which the Company will deliver the Indenture
will accept delivery of such Indenture;
(g) that the Indenture will effect, and will constitute legal,
valid and binding obligations of each of the parties thereto,
enforceable in accordance with their terms, under the laws of
the jurisdiction by which it is expressed to be governed;
(h) that the Indenture will be in the proper legal form to be
admissible in evidence and enforced in the courts of the
applicable jurisdiction and in accordance with the laws of
the applicable jurisdiction;
(i) that there are no provisions of the laws or regulations of
any jurisdiction other than Bermuda which would be
contravened by the execution or delivery of the Indenture or
which would have any implication in relation to the opinions
expressed herein and that, in so far as any obligation under,
or action to be taken under, the Indenture and the Bye-laws
of the Company it will be required to be performed or taken
in any jurisdiction outside Bermuda, the performance of such
obligation or the taking of such action will constitute a
valid and binding obligation of each of the parties thereto
under the laws of that jurisdiction and will not be illegal
by virtue of the laws of that jurisdiction;
(j) that the Resolutions are in full force and effect and have
not been rescinded, either in whole or in part, and
accurately record the resolutions passed by the Board of
Directors of the Company at meetings which were duly convened
2
and at which duly constituted quorum was present and voting
throughout and accurately record the resolutions adopted by
the Directors of the Company;
(k) that the records which were the subject of the Company Search
were complete and accurate at the time of such search and
disclosed all information which is material for the purposes
of this opinion and such information has not since the date
of the Company Search been materially altered;
(l) that the Company will enter into its obligations under the
Indenture in good faith for the purpose of carrying on its
business and that, at the time it does so, there will be
reasonable grounds for believing that the transactions
contemplated by the Indenture will benefit the Company;
(m) that the approval of the issue of any Debt Securities,
Preferred Shares, Common Shares, will be made at a duly
convened and quorate meeting of the Board of Directors of the
Company and, if required, at a duly convened and quorate
meeting of the shareholders of the Company in a manner
complying with the terms of the Resolutions and the
Constitutional Documents;
(n) that when the Board of Directors of the Company authorises
the issue of any Common Shares and any Preferred Shares, the
issue price will not be less than the par values thereof and
the Company will have sufficient authorised capital to effect
the issue; and
(o) that when executed any document presented to us in draft
(including, for the avoidance of doubt, the Indenture) will
not differ in any material way from the draft which we have
examined for the purposes of this opinion.
Opinion
Based upon and subject to the foregoing and subject to the
reservations set out below and to any matters not disclosed
to us, we are of the opinion that:-
(1) Any Common Shares and any Preferred Shares issued under the
authority granted by the Resolutions and the terms set forth
in the Prospectus that forms part of the Registration
Statement, provided that such issue is undertaken subject to
and in accordance with the Constitutional Documents of the
Company and in accordance with Bermuda law, will be duly
authorised, validly issued, fully paid and non-assessable
shares of the Company.
3
(2) The Debt Securities, when issued in accordance with the terms
of the Indenture, duly executed by the Company, and issued
under the authority granted by the Resolutions in accordance
with the terms set forth in the Prospectus that forms part of
the Registration Statement, will constitute the legal and
binding obligations of the Company under the laws of Bermuda.
(3) The statements in the Prospectus included in the Registration
Statement under the captions "Description of Debt
Securities", "Description of Preferred Shares", "Description
of Ordinary Shares" and "Enforcement of Liabilities Civil
Liabilities, insofar as they purport to describe the
provisions of the laws of Bermuda referred to therein, are
accurate and correct in all material respects.
Reservations
We have the following reservations:-
(a) We express no opinion as to the availability of equitable
remedies such as specific performance or injunctive relief,
or as to any matters which are within the discretion of the
courts of Bermuda in respect of any obligations of the
Company as set out in the Indenture, the Securities and in
the Bye-laws of the Company. Further, we express no opinion
as to the validity or binding effect of any waiver of or
obligation to waive either any provision of law (whether
substantive or procedural) or any right or remedy.
(b) Enforcement of the obligations of the Company under the Bye-
laws of the Company and under the Indenture may be limited or
affected by applicable laws from time to time in effect
relating to bankruptcy, insolvency or liquidation or any
other laws or other legal procedures affecting generally the
enforcement of creditors' rights.
(c) Enforcement of the obligations of the Company may be the
subject of a statutory limitation of the time within which
such proceedings may be brought.
(d) We express no opinion as to any law other than Bermuda law
and none of the opinions expressed herein relates to
compliance with or matters governed by the laws of any
jurisdiction except Bermuda. This opinion is limited to
Bermuda law as applied by the Courts of Bermuda at the date
hereof.
(e) Where an obligation is to be performed in a jurisdiction
other than Bermuda, the courts of Bermuda may refuse to
enforce it to the extent that such performance would be
4
illegal under the laws of, or contrary to public policy of,
such other jurisdiction.
(f) We express no opinion as to the validity, binding effect or
enforceability of any provision incorporated into the Bye-
laws of the Company or either of the Indenture by reference
to a law other than that of Bermuda, or as to the
availability in Bermuda of remedies which are available in
other jurisdictions.
(g) Where a person is vested with a discretion or may determine a
matter in his or its opinion, such discretion may have to be
exercised reasonably or such an opinion may have to be based
on reasonable grounds.
(h) We express no opinion as to the validity or binding effect of
any provision of the Indenture which provides for the
severance of illegal, invalid or unenforceable provisions.
(i) A Bermuda court may refuse to give effect to any provisions
of the Indenture and the Bye-laws of the Company in respect
of costs of unsuccessful litigation brought before the
Bermuda court or where that court has itself made an order
for costs.
(j) We express no opinion as to the validity or binding effect of
any provision in the Indenture or the Debt Securities for the
payment of interest at a higher rate on overdue amounts than
on amounts which are current, or that liquidated damages or a
penalty are or may be payable. Such a provision may not be
enforceable if it could be established that the amount
expressed as being payable was in the nature of a penalty;
that is to say a requirement for a stipulated sum to be paid
irrespective of, or necessarily greater than, the loss likely
to be sustained or if it is expressed as a penalty. If it
cannot be demonstrated to the Bermuda court that the higher
payment was a reasonable pre-estimate of the loss suffered,
the court will determine and award what it considers to be
reasonable damages. Section 9 of The Interest and Credit
Charges (Regulations) Act 1975 provides that the Bermuda
courts have discretion as to the amount of interest, if any,
payable on the amount of a judgment after date of judgment.
If the Court does not exercise that discretion, then interest
will accrue at the statutory rate which is currently 7% per
annum.
(k) Any reference in this opinion to Ordinary Shares and the
Preference Shares being "non-assessable" shall mean, in
relation to fully-paid shares of the Company and subject to
any contrary provision in any agreement in writing between
the Company and the holder of shares, that: no shareholder
5
shall be obliged to contribute further amounts to the capital
of the Company, either in order to complete payment for their
shares, to satisfy claims of creditors of the Company, or
otherwise; and no shareholder shall be bound by an alteration
of the Memorandum of Association or Bye-Laws of the Company
after the date on which he became a shareholder, if and so
far as the alteration requires him to take, or subscribe for
additional shares, or in any way increases his liability to
contribute to the share capital of, or otherwise to pay money
to the Company.
(l) Searches of the Register of Companies at the office of the
Registrar of Companies and of the Supreme Court Causes Book
at the Registry of the Supreme Court are not conclusive and
it should be noted that the Register of Companies and the
Supreme Court Causes Book do not reveal:
(i) whether an application to the Supreme Court for a
winding up petition or for the appointment of a
receiver or manager has been prepared but not yet been
presented or has been presented but does not appear in
the Causes Book at the date and time the Search is
concluded;
(ii) whether any arbitration or administrative proceedings
are pending or whether any proceedings are threatened,
or whether any arbitrator has been appointed;
(iii) details of matters which have been lodged for filing or
registration which as a matter of general practice of
the Registrar of Companies would have or should have
been disclosed on the public file but have not actually
been registered or to the extent that they have been
registered have not been disclosed or appear in the
public records at the date and time the search is
concluded;
(iv) whether a receiver or manager has been appointed
privately pursuant to the provisions of a debenture or
other security, unless notice of the fact has been
entered in the register of charges in accordance with
the provisions of the Companies Act 1981.
Furthermore, in the absence of a statutorily defined system
for the registration of charges created by companies
incorporated outside Bermuda ("overseas companies") over
their assets located in Bermuda, it is not possible to
determine definitively from searches of the register of
charges maintained by the Registrar of Companies in respect
of such overseas companies what charges have been registered
over any of their assets located in Bermuda or whether any
6
one charge has priority over any other charge over such
assets.
Disclosure
This opinion is addressed to you solely for your benefit and is
neither to be transmitted to any other person, nor relied upon by
any other person or for any other purpose nor quoted or referred
to in any public document nor filed with any governmental agency
or person, without our prior written consent, except as may be
required by law or regulatory authority. This opinion may be
relied upon by Seward & Kissel LLP, United States Counsel to the
Company. Further, this opinion speaks as of its date and is
strictly limited to the matters stated herein.
We consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to our firm under the
captions "Legal Matters" and "Enforcement of Liabilities" in the
Prospectus which is part of the Registration Statement.
This opinion is governed by and is to be construed in accordance
with Bermuda law. It is given on the basis that it will not give
rise to any legal proceedings with respect thereto in any
jurisdiction other than Bermuda.
Yours faithfully,
APPLEBY SPURLING & KEMPE
7
11 July 2001
SCHEDULE
1. The entries and filings shown in respect of the Company on
the file of the Company maintained in the Register of
Companies at office of the Registrar of Companies in
Hamilton, Bermuda, as revealed by a search on 12 July 2001
(the "Company Search").
2. The entries and filings shown in respect of the Company in
the Supreme Court Causes Book maintained at the Registry of
the Supreme Court in Hamilton, Bermuda, as revealed by a
search on 12 July 2001 in respect of the Company (the
"Litigation Search").
3. An electronic copy of the original Registration Statement on
Form F-3 with respect to the Debt Securities, Preferred
Shares and Common Shares excluding Exhibits and the documents
incorporated by reference.
4. An electronic copy of an original document describing itself
as part of a prospectus, covering securities that are to be
registered under the Securities Act of 1933, as amended (the
"Prospectus").
5. Minutes of the meeting of the Board of Directors of the
Company held on 12 June 2001 (the "Resolutions").
6. Certified copies of the Certificate of Incorporation,
Memorandum of Association and Bye-laws of the Company as at
the date hereof (the "Constitutional Documents").
7. Copies of letters, dated 12 July 2001 evidencing the consent
of the Bermuda Monetary Authority to the issue by the Company
of the Debt Securities, Preferred Shares and Common Shares.
8
02089018.AB0