______________________________________________________________________________
______________________________________________________________________________
California Petroleum Transport Corporation
and
CalPetro Tankers (Bahamas I) Limited
___________________________________
TERM LOAN AGREEMENT
Dated as of ________ 1, 1994
___________________________________
______________________________________________________________________________
______________________________________________________________________________
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
ARTICLE II
THE TERM LOAN
Section 2.01 The Term Loan............................................ 1
Section 2.02 Interest................................................. 1
Section 2.03 Repayment of Principal................................... 2
Section 2.04 Mandatory Prepayment of the Term Loan.................... 2
Section 2.05 Voluntary Prepayment of the Term Loan.................... 2
Section 2.06 Maximum Interest Rate.................................... 2
Section 2.07 Manner of Payment........................................ 2
Section 2.09 Transfer of Loan Agreement............................... 3
Section 2.10 Joint and Several Obligation............................. 3
Section 2.11 Non-Recourse Obligations................................. 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE OWNER
Section 3.01 Organization, Power and Status of the Owner.............. 4
Section 3.02 Authorization; Enforceability; Execution and Delivery.... 4
Section 3.03 No Conflicts; Laws and Consents; No Default.............. 4
Section 3.04 Governmental Approvals................................... 5
Section 3.05 Litigation............................................... 5
Section 3.06 Taxes.................................................... 5
ARTICLE IV
CONDITION PRECEDENT
Section 4.01 Condition Precedent...................................... 5
ARTICLE V
COVENANTS OF THE OWNER
Section 5.01 Payment of Principal and Interest; Payment of Taxes...... 5
Section 5.02 Corporate Existence...................................... 5
Section 5.03 Performance of Obligations............................... 6
Section 5.04 Activities of the Owners................................. 6
Section 5.05 No Bankruptcy Petition................................... 6
Section 5.06 Other Debt............................................... 6
Section 5.07 Guarantees, Loans, Advances and Other Liabilities........ 7
Section 5.08 Consolidation, Merger and Sale of Assets................. 7
Section 5.09 Capital Expenditures..................................... 7
Section 5.10 Books and Records........................................ 7
Section 5.11 Restricted Payments...................................... 7
Section 5.12 Acceptable Replacement Charter........................... 7
Section 5.13 Provision of Reports and Information..................... 8
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
Section 6.01 Events of Default........................................ 8
Section 6.02 Enforcement of Remedies.................................. 9
Section 6.03 Acceleration of Term Loan................................ 9
Section 6.04 Specific Remedies........................................ 10
Section 6.05 Rights and Remedies Cumulative........................... 11
Section 6.06 Restoration of Rights and Remedies....................... 11
Section 6.07 Waiver of Past Defaults.................................. 11
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment................................................ 12
Section 7.02 Severability............................................. 12
Section 7.03 Notices.................................................. 12
Section 7.04 Consent to Jurisdiction.................................. 12
Section 7.05 Captions................................................. 13
Section 7.06 Governing Law............................................ 13
Section 7.07 No Partnership........................................... 13
Section 7.08 Counterparts............................................. 13
Section 7.09 Survival................................................. 13
Section 7.10 Integration.............................................. 13
Section 7.11 Reproduction of Documents................................ 13
Section 7.12 Successors and Assigns; Assignment....................... 13
Section 7.13 General Interpretive Principles.......................... 14
Section 7.14 Effective Date of Transaction............................ 14
Term Loan Agreement, dated as of _________ 1, 1994 (the "Loan
Agreement"), between California Petroleum Transport Corporation, a
corporation organized under the laws of the State of Delaware (the
"Lender") and CalPetro Tankers (Bahamas I) Limited, a company organized
under the laws of The Commonwealth of the Bahamas (the "Owner").
PRELIMINARY STATEMENT
The Owner has requested that the Lender make a loan to the Owner
in the aggregate principal amount equal to $____________ (the "Term Loan").
Concurrently herewith, the Owner is requesting that the Lender make a series
of loans to the Owner in the aggregate principal amount equal to $____________
(collectively, the "Serial Loans"). The net proceeds of the Serial Loans and
the Term Loan will be used by the Owner to acquire the m.t. _________ (the
"Vessel") from Chevron Transport Corporation (the "Initial Charterer"). The
Vessel will be bareboat chartered to the Initial Charterer pursuant to the
Bareboat Charter (the "Initial Charter"), dated as of the date hereof, between
the Owner and the Initial Charterer. As collateral security for its
obligations hereunder, the Owner will assign, pledge, mortgage and grant to
the Lender a security interest in, inter alia, the Vessel, the Initial Charter
and the earnings and insurances of the Vessel.
The Lender is willing to make the Term Loan to the Owner pursuant
to this Loan Agreement upon the terms and subject to the conditions contained
herein:
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and of other valuable consideration, receipt of
which is hereby acknowledged, the Owner and the Lender hereby agree as follows:
ARTICLE I
DEFINITIONS
Capitalized terms used in this Loan Agreement shall have the
meanings assigned to such terms in Schedule 1 to this Loan Agreement, and the
definitions of such terms shall be equally applicable to both the singular and
plural forms of such terms.
ARTICLE II
THE TERM LOAN
Section 2.01 The Term Loan. The Lender agrees upon the terms and
subject to the conditions hereof to make the Term Loan to the Owner on the
Closing Date in the initial principal amount of $___________.
Section 2.02 Interest. Interest on the outstanding principal
balance of the Term Loan shall be payable at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 360 days) equal to
the ___% (the "Interest Rate"). Interest shall be payable in arrears on each
Payment Date. If the Owner shall default in the payment of the principal of,
or interest on the Term Loan or any other amounts becoming due thereunder, the
Owner shall, on demand, pay interest on such unpaid amounts, to the extent
permitted by applicable law, during the Default Period at a rate per annum
equal to the Default Rate.
Section 2.03 Repayment of Principal. Principal on the Term Loan
shall be payable on each Payment Date commencing the First Principal Payment
Date in the amounts set forth in Schedule 2 set forth hereto; provided,
however, if the Initial Charterer terminates the Initial Charter on an
Optional Termination Date, then Principal on the Term Loan shall be payable on
each Payment Date commencing the First Principal Payment Date in the amounts
set forth in Schedule 3-A, Schedule 3-B, Schedule 3-C and Schedule 3-D, as
applicable.
Section 2.04 Mandatory Prepayment of the Term Loan. (a) In the
event the Vessel is a Total Loss, the Owner shall prepay the outstanding
principal balance of the Term Loan on the Loss Date, together with an amount
equal to all accrued interest thereon to but not including the Loss Date;
provided, however, in the event the Total Loss Proceeds are in an amount less
than the sum of the outstanding principal balance of the Term Loan and the
Serial Loans, together with an amount equal to all accrued interest thereon to
but not including the Loss Date, then the Owner shall prepay the outstanding
principal balance of the Term Loan and the Serial Loans, together with an
amount equal to all accrued interest thereon to but not including the Loss
Date, pro rata, in accordance with their respective outstanding principal
balances.
(b) In the event the Vessel is sold pursuant to Section 5.12,
the Owner shall use the entire net proceeds of such sale to prepay the
outstanding principal balance of the Term Loan. Such prepayment shall be in
full and complete satisfaction of the Owner's obligations hereunder.
Section 2.05 Voluntary Prepayment of the Term Loan. The Term Loan
is not subject to voluntary prepayment by the Owner prior to ________, 2005.
Thereafter, with the prior written consent of the Lender, the Owner may prepay
the Term Loan, in whole or in part, together with all interest accrued and
unpaid thereon.
Section 2.06 Maximum Interest Rate. Nothing herein shall require
the Owner to pay interest at a rate exceeding the maximum rate permissible by
applicable law. If the Interest Rate payable by the Owner on any date would
exceed the maximum rate permissible by applicable law, the Interest Rate shall
automatically be reduced to such maximum permitted amount. Any interest
actually received for any period in excess of such maximum allowable amount
for such period shall be deemed to have been applied as a prepayment of
principal of the Term Loan.
Section 2.07 Manner of Payment. (a) All payments due to the
Lender under this Loan Agreement shall be made without any reduction or
deduction whatsoever, including any reduction or deduction for any set-off,
recoupment or counterclaim.
(b) Whenever any payment to the Lender under this Loan Agreement
shall be due on a day other than a Business Day, the date of payment thereof
shall be extended to the next succeeding Business Day. If the date for any
payment under this Loan Agreement is extended, such payment shall bear
interest for such extended period at the applicable Interest Rate.
(c) Any payment received by the Lender hereunder shall be
applied as follows: first, toward the payment of interest on overdue payments
at the Default Rate, then due and payable; second, toward the payment of all
interest then due and payable on the Term Loan; third, toward the payment of
the principal then due and payable on the Term Loan due on the related Payment
Date (or, if the payment relates to the mandatory prepayment of the Term Loan
pursuant to Section 2.04, pro rata, in accordance with the outstanding
principal balance of the Term Loan and the Serial Loans then outstanding); and
fourth, toward any unpaid expenses of the Lender in connection with this Loan
Agreement or any other Security Documents.
(d) Payment of sums due under the provisions of this Loan
Agreement shall be made by wire transfer to the Lender's nominated bank and
receipt of such wire transfer by such bank by 10:00 a.m. New York time on the
due date for payment.
Section 2.09 Transfer of Loan Agreement. This Loan Agreement, and
the right to receive all payments of principal, interest and any other amounts
hereunder, may be transferred by the Lender only upon surrender thereof of
this Loan Agreement to the Owner (except to the Collateral Trustee pursuant to
the Collateral Trust Agreement). The Owner shall, upon such surrender,
accompanied by a written request of the Lender, execute and deliver in
replacement thereof a new Loan Agreement with the Lender's transferee.
Section 2.10 Joint and Several Obligation. In consideration of
the Other Owners agreeing to be jointly and severally liable with the Owner
for all the Owner's obligations and liabilities hereunder and under the Serial
Loan Agreement, the Owner hereby covenants and agrees with the Lender that the
Owner will be jointly and severally liable with the Other Owners on the Other
Loans, but only to the extent of the proceeds received by the Lender (or the
Lender's successors and assigns) from the Lender's right, title and interest
in and to the Collateral.
Section 2.11 Non-Recourse Obligations. The Lender, and any
subsequent assignee or transferee of this Loan Agreement, hereby agrees that
the Owner has and shall have no personal liability or obligation with respect
to the payment of the Term Loan, the Serial Loans or the Other Loans, and that
the Term Loan, the Serial Loans and the Other Loans are payable solely from
the proceeds received by the Lender (or the Lender's successors and assigns)
from the Lender's right, title and interest in and to the Collateral.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE OWNER
The Owner hereby represents and warrants to the Lender as follows:
Section 3.01 Organization, Power and Status of the Owner. The
Owner (a) is a corporation duly formed, validly existing and in good standing
under the laws of The Bahamas and (b) is duly authorized, to the extent
necessary, to do business in each jurisdiction where the character of its
properties or the nature of its activities makes such qualification necessary.
The Owner has all requisite corporate power and authority to own and operate
the property it purports to own and to carry on its business as now being
conducted and as proposed to be conducted in respect of the Vessel.
Section 3.02 Authorization; Enforceability; Execution and Delivery.
(a) The Owner has all necessary corporate power and authority to execute,
deliver and perform under this Loan Agreement and each other Security Document
to which it is a party.
(b) All action on the part of the Owner that is required for the
authorization, execution, delivery and performance of this Loan Agreement and
each other Security Document to which it is a party, in each case has been
duly and effectively taken; and the execution, delivery and performance of
this Loan Agreement and each such other Security Document does not require the
approval or consent of any Person except for such consents and approvals as
have been obtained on or prior to the Closing Date.
(c) This Loan Agreement and each other Security Document to which
the Owner is a party has been duly executed and delivered by it. Each of this
Loan Agreement and each other Security Document to which the Owner is a party
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with the terms thereof.
Section 3.03 No Conflicts; Laws and Consents; No Default. (a)
Neither the execution, delivery and performance of this Loan Agreement and
each other Security Document to which the Owner is a party nor the
consummation of any of the transactions contemplated hereby or thereby nor
performance of or compliance with the terms and conditions hereof or thereof
(i) contravenes any Requirement of Law applicable to the Owner or any of the
Collateral, (ii) constitutes a default under any Security Document or (iii)
results in the creation or imposition of any Lien on any of the Collateral
(other than the Lien created by any of the Security Documents) or results in
the acceleration of any obligation.
(b) The Owner is in compliance with and not in default under any
and all Requirements of Law applicable to the Owner and all terms and
provisions of this Loan Agreement and all other Security Documents.
Section 3.04 Governmental Approvals. All Governmental Approvals
which are required to be obtained in the name of the Owner in connection with
(a) the construction, operation and maintenance of the Vessel and (b) the
execution, delivery and performance by the Owner of this Loan Agreement and
the Security Documents have been obtained and are in effect on the Closing
Date.
Section 3.05 Litigation. There are no actions, suits or
proceedings at law or in equity or by or before any Governmental Authority now
pending against the Owner or, to the best of the Owner's knowledge, threatened
against the Owner or pending or threatened against any property or other
assets or rights of any of the Owner with respect to this Loan Agreement and
any other Security Document.
Section 3.06 Taxes. The Owner has filed, or caused to be filed,
all tax and information returns that are required to have been filed by it in
any jurisdiction and has paid, or caused to be paid, all taxes shown to be due
and payable on such returns and all other taxes and assessments payable by it,
including, without limitation, any taxes payable by the Owner with respect to
its Vessel and its interest in the Initial Charter, to the extent the same
have become due and payable.
ARTICLE IV
CONDITION PRECEDENT
Section 4.01 Condition Precedent. The obligation of the Lender to
make the Term Loan hereunder is subject to the issuance of the Securities by
the Lender under the Indentures.
ARTICLE V
COVENANTS OF THE OWNER
The Owner hereby covenants and agrees that so long as this Loan
Agreement remains outstanding:
Section 5.01 Payment of Principal and Interest; Payment of Taxes.
(a) The Owner will duly and punctually pay the principal of and interest on
the Term Loan in accordance with the terms of this Loan Agreement.
(b) The Owner will take all actions as are necessary to insure
that all taxes and governmental claims, if any, in respect of the Owner's
activities and assets are promptly paid.
Section 5.02 Corporate Existence. (a) The Owner will keep in full
effect its existence, rights and franchises as a corporation under the laws of
The Commonwealth of the Bahamas, and will obtain and preserve its
qualification as a foreign entity in each jurisdiction in which such
qualification is necessary to protect the validity and enforceability of this
Loan Agreement and any of the other Security Documents to which it is a party.
(b) The Owner shall not amend its Memorandum of Association or
Articles of Association without the prior written consent of the Lender.
Section 5.03 Performance of Obligations. The Owner will not take,
or fail to take, any action, and will use its best efforts not to permit any
action to be taken by others, which would release any Person from any of such
Person's covenants or obligations under any agreement or instrument included
in the Collateral, or which would result in the amendment, hypothecation,
subordination, termination or discharge of, or impair the validity or
effectiveness of, any such agreement or instrument, except as expressly
permitted in this Loan Agreement.
Section 5.04 Activities of the Owners. The Owner shall not engage
in any activities other than (i) to enter into, or become a party to, a
Purchase Agreement with the Initial Charterer for the Vessel, (ii) to register
the Vessel under and pursuant to the laws of the Registration Jurisdiction,
(iii) to enter into, or become a party to, the Initial Charter with the
Initial Charterer and any additional charters or contracts of affreightment
occasioned by the termination of the Initial Charter, (iv) to borrow the Term
Loan and the Serial Loans from the Lender and to become jointly and severally
liable with the Other Owners on the Other Loans, (v) to assign, grant,
transfer, pledge, mortgage or convey its Vessel and its freights and earnings
to the Lender, (vi) to enter into, perform its obligations under, and perform
any other activities contemplated by, the Loan Agreements, the Mortgage, the
Initial Charter, the Assignment of Earnings and Insurances, the Assignment of
Charter, the Management Agreement, the Issue of One Debenture, the Assignment
of Management Agreement and the Assignment of Purchase Agreement and (vii) to
engage only in those activities, including the entering into performing and/or
delivering any and all applications, licenses, agreements, necessary, suitable
or convenient to accomplish the foregoing or incidental thereto or connected
therewith.
Section 5.05 No Bankruptcy Petition. The Owner shall not (i)
commence any case, proceeding or other action under any existing or future
bankruptcy, insolvency or similar law seeking to have an order for relief
entered with respect to it, or seeking reorganization, arrangement,
adjustment, wind-up, liquidation, dissolution, composition or other relief with
respect to it or its debts, (ii) seek appointment of a receiver, trustee,
custodian or other similar official for it or any part of its assets, (iii)
make a general assignment for the benefit of creditors, or (iv) take any
action in furtherance of, or consenting or acquiescing in, any of the
foregoing.
Section 5.06 Other Debt. The Owner shall not after the Closing
Date, contract for, create, incur, assume or suffer to exist any indebtedness
other than the Serial Loans, except (i) trade payables and expense accruals
incurred in the ordinary course and which are incidental to the purposes
permitted pursuant to Section 5.04 hereof and (ii) indebtedness contemplated by
this Loan Agreement or any of the other Security Documents.
Section 5.07 Guarantees, Loans, Advances and Other Liabilities.
The Owner shall not make any loan or advance or credit to, or guarantee
(directly or indirectly or by an instrument having the effect of assuring
payment or performance on any obligation of another Person or such Person's
capability of so doing, or otherwise), endorse (except for the endorsement of
checks for collection or deposit) or otherwise become contingently liable,
directly or indirectly, in connection with the obligations, stock or dividends
of, or own, purchase, repurchase or acquire (or agree contingently to do so)
any stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any other Person except the Owner's obligations as
under the Other Loans.
Section 5.08 Consolidation, Merger and Sale of Assets. The Owner
shall not consolidate with, or merge with or into, any other Person or convey
or transfer to any Person all or any part of the Collateral.
Section 5.09 Capital Expenditures. The Owner shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(both realty and personalty) other than for the purchase of its Vessel.
Section 5.10 Books and Records. The Owner shall at all times keep
proper books and records of all of its business and financial affairs in
accordance with generally accepted accounting principles, as in effect on the
date hereof in the jurisdiction in which its chief executive office is
located. The Owner shall keep books of account or records concerning its
accounts, inventory, contract rights, equipment and proceeds at its offices
located at United House, 14-16 Nelson Street, Douglas, Isle of Man.
[Section 5.11 Restricted Payments. Prior to the First Principal
Payment Date, the Owner shall not make any Restricted Payment. On and after
the First Principal Payment Date, the Owner may make a Restricted Payment if
(a) no default under the Mortgage shall have occurred and be continuing, (b)
the Serial Notes shall have been repaid in full and (c) the Vessel shall be on
charter to the Initial Charterer or under an Acceptable Replacement Charter to
a charterer whose unsecured credit ratings from the Rating Agencies are at
least equal to the respective unsecured ratings of Chevron and the terms of
such charters shall be at least sufficient to pay in full all of the remaining
payments of principal and interest outstanding on the Term Loan.] [TO BE
REVISED TO CONFORM TO TERM REGISTRATION STATEMENT.]
Section 5.12 Acceptable Replacement Charter. (a) In the event the
Initial Charterer terminates the Initial Charter, the Owner shall cooperate
with the Manager and the Trustee to locate an Acceptable Replacement Charter.
In the event an Acceptable Replacement Charter is available the Owner shall
enter into such Acceptable Replacement Charter and assign all of its right,
title and interest in, to and under such Acceptable Replacement Charter to the
Lender as collateral for the Owner's obligations hereunder.
(b) In the event an Acceptable Replacement Charter is not
available, the Owner shall instruct the Manager to solicit bids for the sale
of the Vessel. In the event the Manager notifies the Owner that the Manager
has obtained a cash bid that results in the realization of net proceeds in an
amount that is equal to or greater than the outstanding principal balance of
the Term Loan, together with accrued interest thereon, the Owner shall execute
any and all documents, instruments and agreements necessary or advisable to
effectuate the sale that would result in the greatest cash net proceeds.
(c) If no bid meets the requirements set forth in Section
5.12(b) hereof, then the Owner shall consult with the Manager and the Trustee
pursuant to the Management Agreement and consider bids regarding the
disposition of the Vessel. If the Lender, or the Lender's assignee, consents
in writing, the Owner shall accept the highest bid available for the sale of
the Vessel. If the Lender, or the Lender's assignee, does not so consent, the
Owner shall recharter the Vessel pursuant to a charter that the Manager, in
its sole discretion, deems appropriate so long as (i) such charter is an arms'
length agreement, (ii) the charterhire payable thereunder during the term
thereof is an amount sufficient to (A) make the mandatory sinking fund
payments, together with all interest payable thereon, due on the Term Mortgage
Notes, (B) pay Recurring Fees and Taxes for such Vessel, (C) to pay the
Management Fees and Technical Advisor's Fees for such Vessel and (D) to pay
the amount of fees and expenses of the Indenture Trustee and Collateral
Trustee allocable to such Vessel and (iii) such charter terminates no later
than ___________, 2014.
Section 5.13 Provision of Reports and Information. The Owner shall
provide to the Lender any and all information and reports required to be
furnished or provided by it pursuant to the Act.
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
Section 6.01 Events of Default. Any one or more of the following
events shall constitute an Event of Default:
(a) if the Owner shall default in the making of any payment of
all or any part of the principal of, interest on, or other amount or charge
due under this Loan Agreement, whether at the stated maturity thereof or at
any date fixed for payment by acceleration, by notice of prepayment or
otherwise, and the continuance of such default for a period of two Business
Days after the due date therefor;
(b) if the Owner shall default in the performance or observance
of any covenant contained in Sections 5.02, 5.03, 5.10 and 5.12 of this Loan
Agreement, and the continuance of such default for a period of 30 days after
written notice thereof by the Lender;
(c) if the Owner shall default in the performance or observance
of any covenant contained in Article V hereof (other than Sections 5.01, 5.02,
5.03, 5.10 and 5.12 of this Loan Agreement);
(d) if any representation or warranty made by the Owner herein,
in any Security Document or in any document or certificate furnished by the
Owner in connection herewith or therewith or pursuant hereto or thereto shall
at any time prove to have been false, incorrect or misleading in any material
respect at the time made or deemed to be made;
(e) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or receiver
or liquidator in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or liquidation
of its affairs, shall have been entered against the Owner and such decree or
order shall have remained in force undischarged or unstayed for a period of
sixty (60) days;
(f) The Owner shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to such party
or of or relating to all or substantially all of such party's property;
(g) The Owner shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or
(h) if an Event of Default as defined in the Mortgage shall
occur and be continuing.
Section 6.02 Enforcement of Remedies. After an Event of Default
shall have occurred and be continuing, then and in every such case the Lender
may exercise any or all of the rights and powers and pursue any and all of the
remedies pursuant to this Article and any of the other Security Documents, and
to the extent permitted by applicable law, may, provided the Lender pursuant
to Section 6.03 hereof shall have declared the unpaid principal amount of the
Term Loan immediately due and payable, take possession of all or any part of
the Collateral and may exclude the Owner and all Persons claiming under it
wholly or partly therefrom.
Section 6.03 Acceleration of Term Loan. Upon the occurrence and
during the continuance of an Event of Default hereunder, the Lender may
declare the unpaid principal amount of the Term Loan, together with accrued
interest thereon to be immediately due and payable, upon which declaration
such principal amount and such accrued interest shall immediately become due
and payable without further act or notice of any kind.
Section 6.04 Specific Remedies. Upon the occurrence and during the
continuance of an Event of Default and provided that the Lender pursuant to
Section 6.03 hereof shall have declared the unpaid principal amount of the
Term Loan immediately due and payable:
(a) At the request of the Lender, the Owner shall promptly
execute and deliver to the Lender such instruments and other documents as the
Lender may deem necessary or advisable to enable the Lender or an agent or
representative designated by the Lender, at such time or times and place or
places as the Lender may specify, to obtain possession of all or any part of
the Collateral to which possession the Lender shall at the time be entitled
hereunder. If the Owner shall for any reason fail to execute and deliver such
instruments and documents after such request by the Lender, the Lender may
obtain a judgment conferring on the Lender the right to such possession
immediately and requiring the Owner to deliver such instruments and documents
to the Lender, to the entry of which judgment the Owner hereby specifically
consents.
(b) The Lender may proceed to enforce the rights of the Lender
by directing payment to it of all monies payable under any agreement or
undertaking constituting a part of the Collateral, by proceedings in any court
of competent jurisdiction for the appointment of a receiver or for sale of all
or any part of the Collateral possession to which the Lender shall at the time
be entitled hereunder or for foreclosure of such Collateral, and by any other
action, suit, remedy or proceeding authorized or permitted by this Loan
Agreement or by law or by equity, and may file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Lender asserted or upheld in any bankruptcy, receivership or
other judicial proceedings.
(c) The Lender shall be entitled to set-off against and withdraw
all amounts constituting a part of the Collateral and to apply the same as
follows:
First: To the payment of all reasonable expenses and charges,
including the expenses of any taking, attorney's fees, court costs
and other expenses or advances made or incurred by the Lender in
connection with the ascertainment or protection of its rights and
the pursuance of its remedies hereunder or under any of the
Security Documents (including, without limitation, the reasonable
fees and disbursements of counsel);
Second: To the payment of all amounts due to the Lender in
respect of taxes, indemnities, fees, expenses, premiums, purchase
of liens or otherwise under the provisions hereof or under any of
the Security Documents;
Third: To the payment of interest on the Serial Loans and Term
Loan, pro rata, in accordance with their respective outstanding
balances;
Fourth: To the payment of principal on the Serial Loans and the
Term Loan, pro rata, in accordance with their respective
outstanding balances;
Fifth: To the payment of any amount due and owing under the Other
Loans, pro rata, in the event of an acceleration of the principal
amount of such Other Loans; and
Sixth: To the payment of any surplus thereafter remaining to the
Owner or whomsoever may be lawfully entitled thereto.
(d) Without limiting the foregoing, the Lender, its assigns and
its legal representatives shall have all the remedies of a secured party under
applicable law and such further remedies as from time to time may hereafter be
provided pursuant to such law for a secured party. In exercising its power of
sale, the Lender shall be entitled to add to the Term Loan any and all of the
Lender's expenses. In exercising its power of sale under this Loan Agreement,
the Lender may sell such portion of the Collateral or any part thereof, either
as one unit or in separate units, all as the Lender may in its discretion
elect; and the Lender may so sell the aforesaid properties, rights and
interests or any part thereof either separately from or together with the
whole or any part of other property which may constitute security for any
obligation with respect to the Term Loan, all as the Lender may in its
discretion elect.
Section 6.05 Rights and Remedies Cumulative. Each and every right,
power and remedy herein specifically given to the Lender under this Loan
Agreement shall be cumulative and shall be in addition to every other right,
power and remedy herein specifically given or now or hereafter existing at
law, in equity or by statute, and each and every right, power and remedy
whether specifically herein given or otherwise existing may be exercised from
time to time and as often and in such order as may be deemed expedient by the
Lender, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other right, power or remedy. No delay or
omission by the Lender in the exercise of any right, remedy or power or in the
pursuance of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Owner or to be an
acquiescence therein.
Section 6.06 Restoration of Rights and Remedies. In case the
Lender shall have proceeded to enforce any right, power or remedy under this
Loan Agreement by foreclosure, entry or otherwise, and such proceedings shall
have been discontinued or abandoned for any reason or shall have been
determined adversely to the Lender, then and in every such case the Owner and
the Lender shall be restored to their former positions and rights hereunder
with respect to the Collateral, and all rights, remedies and powers of the
Lender shall continue as if no such proceedings had been taken.
Section 6.07 Waiver of Past Defaults. Any past default hereunder
with respect to the Term Loan or its consequences may be waived by the Lender.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every
purpose of this Loan Agreement; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment. This Loan Agreement may be amended from
time to time by written agreement signed by the parties hereto.
Section 7.02 Severability. If any provision of this Loan Agreement
is held to be in conflict with any applicable statute or rule of law or is
otherwise held to be unenforceable for any reason whatsoever, such
circumstances shall not have the effect of rendering the provision in question
inoperative or unenforceable in any other case or circumstance, or of
rendering any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatsoever. The invalidity of any
one or more phrases, sentences, clauses or Sections of this Loan Agreement
contained, shall not affect the remaining portions of this Loan Agreement, or
any part thereof.
Section 7.03 Notices. All demands, notices and communications
hereunder shall be in writing, personally delivered or mailed by certified
mail-return receipt requested, and shall be deemed to have been duly given
upon receipt (a) in the case of the Lender, at the following address: c/o JH
Management Corporation, Room 6/9, One International Place, Boston,
Massachusetts 02110-2624, (b) in the case of the Owner, at the following
address: United House, 14-16 Nelson Street, Douglas, Isle of Man, or at other
such address as shall be designated by such party in a written notice to the
other parties.
Section 7.04 Consent to Jurisdiction. Any legal suit, action or
proceeding against the Owner arising out of or relating to this Loan
Agreement, or any transaction contemplated hereby, may be instituted in any
federal or state court in The City of New York, State of New York and the
Owner hereby waives any objection which it may now or hereafter have to the
laying of venue of any such suit, action or proceeding, and the Owner hereby
irrevocably submits to the jurisdiction of any such court in any such suit,
action or proceeding. The Owner hereby irrevocably appoints and designates CT
Corporation System, having an address at 1633 Broadway, New York, New York,
its true and lawful attorney-in-fact and duly authorized agent for the limited
purpose of accepting servicing of legal process and the Owner agrees that
service of process upon such party shall constitute personal service of
process on the Owner. The Owner shall maintain the designation and
appointment of such authorized agent until all amounts payable under this Loan
Agreement shall have been paid in full. If such agent shall cease to so act,
the Owner shall immediately designate and appoint another such agent
satisfactory to the Lender and shall promptly deliver to the Lender evidence
in writing of such other agent's acceptance of such appointment.
Section 7.05 Captions. The captions or headings in this Loan
Agreement are for convenience only and in no way define, limit or describe the
scope or intent of any provisions or sections of this Loan Agreement.
Section 7.06 Governing Law. This Loan Agreement shall be governed
by and interpreted in accordance with the laws of the State of New York,
without giving effect to the principles of conflicts of law.
Section 7.07 No Partnership. Nothing herein contained shall be
deemed or construed to create a partnership or joint venture among the parties
hereto and the services of each party shall be rendered as an independent
contractor and not as agent for any other party.
Section 7.08 Counterparts. This Loan Agreement may be executed in
any number of counterparts and by different parties hereto on separate
counterpart, each of which shall be deemed to be an original. Such
counterparts shall constitute one and the same agreement.
Section 7.09 Survival. The representations, covenants and
agreements contained in or made pursuant to this Loan Agreement in respect of
either party hereto shall survive the execution and delivery of this Loan
Agreement and shall continue in effect so long as such party's obligations
hereunder remain outstanding.
Section 7.10 Integration. This Loan Agreement and the Schedule and
Exhibits hereto constitute the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements, understandings or representations pertaining to the subject
matter hereof, whether oral or written. There are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth or incorporated herein.
Section 7.11 Reproduction of Documents. This Loan Agreement and all
documents relating thereto, including, without limitation, (a) consents,
waivers and modifications which may hereafter be executed, (b) documents
received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course
of business) and that any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence.
Section 7.12 Successors and Assigns; Assignment. This Loan
Agreement shall be binding upon and inure to the benefit of the Owner and the
Lender and their respective successors and assigns. The Owner shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lender. Subject to Section 2.09 hereof, the
Lender, at its sole option, shall have the right to assign this Loan
Agreement, the Serial Notes, the Security Documents and any of its rights and
interest hereunder and thereunder.
Section 7.13 General Interpretive Principles. For purposes of
this Loan Agreement except as otherwise expressly provided or unless the
context otherwise requires:
(a) the defined terms in this Loan Agreement shall include the
plural as well as the singular, and the use of any gender herein shall be
deemed to include any other gender;
(b) accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles as in effect on the date hereof;
(c) references herein to "Articles", "Sections", "Subsections",
"paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, paragraphs and other subdivisions
of this Loan Agreement;
(d) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to paragraphs and
other subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Loan Agreement as a whole and not to any
particular provision; and
(f) the term "include" or "including" shall mean without
limitation by reason of enumeration.
Section 7.14 Effective Date of Transaction. Notwithstanding the
fact that this Loan Agreement is dated as of __________ 1, 1994, the
transactions set forth herein shall not be effective until the Closing Date.
IN WITNESS WHEREOF, the Owner and the Lender have caused this Loan
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized all as of the day and year first above written.
CALIFORNIA PETROLEUM TRANSPORT
CORPORATION, as Lender
By:
Name:
Title:
CALPETRO TANKERS (BAHAMAS I) LIMITED, as Owner
By:
Name:
Title:
SCHEDULE 1
Defined Terms Used in the Loan Agreement
"Act" means the United States Securities Act of 1933, as amended.
"Acceptable Replacement Charter" means any replacement charter which
satisfies each of the following requirements: (i) the charter is a bareboat
charter and requires that the charterer thereunder "gross up" charterhire
payments to indemnify and hold the Holders of the Securities harmless from any
withholding tax imposed on the charterhire payments or on the payments on the
Securities; (ii) the charterhire payments payable during the non-cancelable
term of such replacement charter, after giving effect to (1) any "gross up" of
such amounts as a result of any withholding tax on such charterhire payments,
(2) the receipt of the Termination Payment and (3) all fees and expenses
incurred in connection with the rechartering of the Vessel, provide sufficient
funds for the payment in full when due of (A) the Allocated Principal Amount
of the Term Mortgage Notes for the related Vessel and interest thereon in
accordance with the revised schedule of sinking fund and principal payments,
that is applicable upon termination of the related Initial Charter, (B) the
amount of Recurring Fees and Taxes for such Vessel, (C) the amount of
Management Fees and Technical Advisor's Fees for such Vessel, (D) the amount of
fees and expenses of the Indenture Trustee and Collateral Trustee allocable to
such Vessel and (E) an amount at least equal to 30% of the estimated amounts,
on a per annum basis, referred to in clauses (B), (C) and (D) above for
miscellaneous or unexpected expenses; and (iii) the Rating Agencies shall have
confirmed in writing to the Trustee that the terms and conditions of such
proposed charter will not result in the withdrawal or reduction of the then
current ratings of the Term Mortgage Notes.
"Affiliate" means with respect to any Person, any other Person directly
or indirectly controlling, controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Assignment of Charter" means the assignment between the Owner and the
Lender, as amended from time to time in accordance with the terms thereof,
together with the documents contemplated thereby, pursuant to which the Owner
assigns to the Lender all of its right, title and interest in, to and under
the Initial Charter.
"Assignment of Earnings and Insurances" means the assignment between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner assigns to the Lender all of its
right, title and interest in, to and under the freights and hires (as well as
any charters entered into after the Closing Date) with respect to the Vessel.
"Assignment of Guarantee" means the assignment between the Owner and the
Lender, as amended from time to time in accordance with the terms thereof,
pursuant to which the Owner assigns to the Lender all of its right, title and
interest in, to and under the Chevron Guarantee.
"Assignment of Management Agreement" means the assignment between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner assigns to the Lender all of its
right, title and interest in, to and under the Management Agreement to secure
its obligations under the Loan Agreements.
"Assignment of Purchase Agreement" means the assignment between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner assigns to the Lender all of its
right, title and interest in, to and under the Purchase Agreement to secure
its obligations under the Loan Agreements.
"Business Day" means any day other than a Saturday, a Sunday or a day on
which banking institutions in New York, New York, or in the city and state
where the Trustee's principal offices are located, are authorized or are
obligated by law, executive order or governmental decree to be closed.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of, such Person's capital stock, whether
outstanding on the Closing Date or issued after the Closing Date, and any and
all rights, warrants or options exchangeable for or convertible into such
capital stock.
"Chevron" means Chevron Corporation, a Delaware corporation.
"Chevron Guarantee" means the guarantee of the obligations of the
Initial Charterer under the Initial Charter given by Chevron dated
____________ 1, 1994.
"Closing Date" means __________ 1, 1994.
"Code" means the United States Internal Revenue Code of 1986 and the
corresponding provisions of any successor statute.
"Collateral" means (i) an assignment of the Initial Charter, (ii) a
mortgage on the Vessel, (iii) an assignment of the earnings and insurances on
the Vessel, (iv) an assignment of the Chevron Guarantee, (v) an assignment of
the Management Agreement relating to the Vessel, (vi) an assignment of the
Purchase Agreement, (vii) the pledge of the shares of the Owner by Owner's
shareholder and (viii) a blanket security interest on all of the assets of the
Owner now existing or hereafter created, together with all income and proceeds
thereof.
"Collateral Trust Agreement" means the collateral trust agreement, dated
as of the date hereof, among the Lender, the Collateral Trustee and the
Trustee.
"Collateral Trustee" means Chemical Trust Company of California, not in
its individual capacity but solely as indenture trustee under the Collateral
Trust Agreement.
"Commencement Date" means the date on which the Vessel is accepted by
the Initial Charterer under the Initial Charter.
"Compulsory Acquisition" means requisition for title or other compulsory
acquisition of the Vessel (otherwise than by requisition for hire), capture,
seizure, detention or confiscation of the Vessel by any other government or by
Persons acting or purporting to act on behalf of any government or
governmental authority.
"Default Period" means the period commencing the date any payment
hereunder was due to but not including the date such payment is paid in full.
"Default Rate" means a rate per annum for each day during the Default
Period until such payment shall be paid in full equal to 1.50% above LIBOR at
the commencement of such period.
"Event of Default" means an Event of Default under Section 6.01 of the
Loan Agreement.
"First Principal Payment Date" means ______________________, the Payment
Date immediately succeeding the Payment Date on which the Serial Loans are
paid in full.
"Governmental Approval" means any authorization, consent, approval,
license, franchise, lease, ruling, permit, tariff, rate, certification,
exemption, filing or registration by or with any Governmental Authority
relating to the ownership of the Collateral or to the execution, delivery or
performance of the Loan Agreement or any Security Document.
"Governmental Authority" means the federal government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any other governmental entity with authority over the Owner
or operation of the Vessels.
"Holder" means the Person in whose name a Security is registered in the
related securities register.
"Indentures" means the Indenture, dated as of _______ 1, 1994 between
the Owner and the Trustee pursuant to which the Term Mortgage Notes will be
issued and the Indenture, dated as of _______ 1, 1994 between the Lender and
the Trustee pursuant to which the Serial Mortgage Notes will be issued.
"Initial Charter" means with respect to each Vessel, the Bareboat
Charter, dated
_________, between the Initial Charterer and the Owner.
"Initial Charterer" means Chevron Transport Corporation, a Liberian
corporation.
"Interest Rate" shall have the meaning assigned to such term in Section
2.02 of the Loan Agreement.
"Issue of One Debenture" means each Issue of One Debenture between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner grants to the Lender a security
interest in all of its assets.
"Law" means any statute, law, rule, regulation, ordinance, order, code,
policy or rule of common law, now or hereafter in effect, and any judicial or
administrative interpretation thereof by a Governmental Authority or
otherwise, including any judicial or administrative order, consent decree or
judgment.
"Lender" means California Petroleum Transport Corporation, a corporation
organized under the laws of the State of Delaware, together with its
successors and assigns.
"LIBOR" means the rate calculated on the basis of the offered rates for
deposits in dollars for a one-month period which appear on the Reuters Screen
LIBO Page as of 11:00 A.M., London time, on the date that is two London
Banking Days preceding the date of calculation. If at least two such offered
rates appear on the Reuters Screen LIBO Page, LIBOR will be the arithmetic
mean of such offered rates (rounded to the nearest .0001 percentage point).
If, at any time of determination, the Reuters Screen LIBO Page is not
available, LIBOR will be calculated as the average (rounded upward, if
necessary, to the next higher 1/16 of 1%) of the respective ratio per annum at
which deposits in dollars for a one month period are offered to each of three
reference banks in the London interbank market at approximately 11:00 A.M.,
London time, on the date that is two London Banking Days preceding the date of
calculation. Each of the Initial Charterer and the Collateral Trustee (as
assignee of the Owner) will select a reference bank and the third reference
bank will be selected by the Initial Charterer and the Collateral Trustee
together or, failing agreement, by the previously selected reference banks
together.
"Lien" means any mortgage, lien (statutory or other), charge, pledge,
security interest, encumbrance, claim, hypothecation, assignment for security,
deposit arrangement or preference or other security agreement of any kind or
nature whatsoever. For purposes of the Loan Agreement, a Person shall be
deemed to own subject to a Lien any property which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement.
"Loan Agreement" means this Term Loan Agreement, dated as of ________
__, 1994, between the Owner and the Lender.
"Loan Agreements" means, collectively, this Loan Agreement and the
Serial Loan Agreement, dated the date hereof, between the Owner and the Lender
wherein the Lender makes the Serial Loans to the Owners.
"London Banking Day" means any day on which dealings in deposits in
United States dollars are carried on in the London interbank market and on
which commercial banks are open for domestic and international business
(including dealings in United States dollar deposits) in London and New York.
"Loss Date" means the date which is 90 days after the occurrence of a
Total Loss of the Vessel.
"Management Agreement" means the agreement, dated the Closing Date,
among the Owner, the Manager and the Technical Adviser.
"Manager" means the Person performing the duties of the Manager under the
Management Agreement, initially P.D. Gram & Co. ans.
"Mortgage" means, with respect to the Vessel, the first preferred ship
mortgages on the Vessel granted by the Owner to the Lender, as amended from
time to time in accordance with the terms of such Mortgage.
"Optional Termination Date" means the [8th, 10th, 12th or 14th] [9th,
11th, 13th or 15th] [10th, 12th, 14th or 16th] [11th, 13th or 15th]
anniversary of the Commencement Date.
"Other Owners" means Calpetro Tankers (Bahamas II) Limited, Calpetro
Tankers (Bahamas III) Limited and Calpetro Tankers (IOM) Limited.
"Other Loans" means each of the loans from California Petroleum
Transport Corporation to each of the Other Owners made on the Closing Date,
having an aggregate initial principal amount of $__________.
"Owner" means CalPetro Tankers (Bahamas I) Limited, a company organized
under the laws of The Commonwealth of the Bahamas.
"Payment Date" means each ________ and ______________ commencing
___________ 1995.
"Person" means an individual, a partnership, a corporation, a joint
venture, an unincorporated association, a joint-stock company, a trust, or
other entity or a government or any agency or political subdivision thereof.
"Purchase Agreement" means the Vessel Purchase Agreement, dated as of
_________________, between the Owner and the Initial Charterer wherein the
Owner purchases the Vessel from the Initial Charterer.
"Rating Agencies" means Moody's Investors Service, Inc., Standard &
Poor's Rating Group and Duff & Phelps Credit Rating Co.
"Registration Jurisdiction" means the jurisdiction in which the Vessel
is or will be registered.
"Requirement of Law" means, as to any Person, the certificate of
incorporation and by-laws or partnership agreement or other organizational or
governing documents of such Person, and, any Law applicable to or binding upon
such Person or any of its properties or to which such Person or any of its
properties is subject.
"Restricted Payment" means any of the following: (i) the declaration or
payment of any dividend or any other distribution on Capital Stock of the
Owner or any payment made to the direct or indirect holders (in their
capacities as such) of Capital Stock of the Owner (other than dividends or
distributions payable solely in Capital Stock or in options, warrants or other
rights to purchase Capital Stock, (ii) the purchase, redemption or other
acquisition or retirement for value of any Capital Stock of the Owner and
(iii) the making of any loans or advances to any Affiliate of the Owner.
"Securities" means, collectively, the Term Mortgage Notes and the Serial
Mortgage Notes.
"Security Documents" means the Loan Agreement, the Mortgage, the
Assignment of Charter, the Assignment of Earnings and Insurances, the
Assignment of Guarantee, the Assignment of Management Agreement and the Issue
of One Debenture, collectively.
"Serial Loans" shall have the meaning assigned to such term in the
Preliminary Statement of this Loan Agreement.
"Serial Mortgage Notes" means the Serial First Preferred Term Mortgage
Notes which will mature serially from _____________, 1995 to _____________,
2005 in the initial aggregate amount of $168,500,000 issued by the Lender
concurrently with the issuance of the Term Mortgage Notes.
"Technical Adviser" means the person performing the duties of the
Technical Adviser under the Management Agreement, initially Barber Ship
Management Group.
"Term Loan" shall have the meaning assigned to such term in the
Preliminary Statement of this Loan Agreement.
"Term Mortgage Notes" means __% First Preferred Mortgage Notes Due 2014
in the initial aggregate amount of $117,900,000 issued by the Lender
concurrently with the issuance of the Serial Mortgage Notes.
"Total Loss" means either (a) an actual or constructive or compromised
or arranged total loss of the Vessel, (b) a Compulsory Acquisition of the
Vessel or (c) if so declared by the Initial Charterer at any time and in its
sole discretion a requisition for hire of the Vessel for a period in excess of
180 days.
"Total Loss Proceeds" means all compensation, damages and other payments
(including insurance proceeds other than certain liability insurance proceeds)
received by the Trustee from any Person, including any governmental authority,
with respect to or in connection with a Total Loss.
"Trustee" means Chemical Trust Company of California, not in its
individual capacity but solely as indenture trustee under the Indentures.
"Vessel" shall have the meaning assigned to such term in the Preliminary
Statement of this Loan Agreement.